This is a boundary line case. Smith and Mefford orally agreed on a line. Smith purported to rescind the agreement and brought this suit to establish his title by deed and adverse possession. The chancellor denied relief to Smith, holding that the oral agreement fixed the common boundary. Appellant Smith here contends that the true boundary line was never in doubt; that there was no consideration; and that the agreement was rescinded by the parties.
In 1958 Hiram Smith, bought the major portion of a forty-acre tract in Johnson County. His deed called for the west 33 acres. Shortly after June 1966, Mefford purchased the balance of the forty from Smith’s neighbor. Mefford’s deed called for the easterly seven acres. A survey made duripg the period of boundary line discussions disclosed a “short forty.” That revelation made a contribution to the misunderstanding which brought about this litigation.
We start with the premise that a question developed between these neighbors about the location of the boundary line between their lands. It came about ydien Mefford approached Smith about straightening and rebuilding a meandering fence. Smith advised that he would first like to have a survey in order to put it on a straight line. Mefford testified that Smith stated the old fence was not actually on the line. Before the line was surveyed the two landowners, according to the surveyor, agreed that the fence would be established on the line determined by the surveyor to be the boundary. The surveyor determined the true boundary line to be several feet west of the old fence. That line would of course result in the loss of acreage by Smith, who had for some time occupied up to the old fence.
Smith was disappointed at the anticipated loss of acreage and in fact disputed the accuracy of the survey. Since Mefford would of course gain acreage on the basis of the survey, his first expression was they should abide by what he considered to be their agreement. Mef-ford, however, indicated that he would consider a compromise rather than the expense of a lawsuit. In fact, Mefford offered to pay Smith, for the land between the old fence and the surveyed line, but Smith declined. It was then that the landowners, in the presence of the county surveyor, entered into an oral agreement advanced by Smith. He proposed that the boundary fence be constructed at a distance six feet east of the surveyed line; that Smith would furnish the wire and the labor of himself and a helper; and that Mefford would furnish the posts and a laborer. Actually, the extra six feet would place the fence on a line where it had originally stood. Smith and the predecessor in title of Mefford had moved the fence to avoid a flooding problem. This is apparently the reason Smith thought he was entitled to the six feet; it strongly indicates Smith believed that line to be the true boundary — six feet east of the surveyor’s line.
The day following the agreement on the line location the work was begun. Smith and two helpers started at the agreed south corner and proceeded, without incident, to set posts for a distance of approximately 300 feet. At that point and on the second day of work, Mef-ford arrived and complained that a straight line was not being followed, to his disadvantage. A heated argument ensued. Smith called off the work project and went home, declaring the agreement at an end. A few days later Mefford completed the project. However, the fence veered slightly to the west from the point where Smith stopped the work and came out on the north end some two feet from the northern point agreed upon. It was then that Smith filed this suit, claiming title by deed and by adverse possession to all lands inside the old irregular fence line.
The chancellor held that a boundary line had been agreed upon; that Mefford should be required to relocate that part of the fence which protruded over the “six-foot line”; that since Mefford supplied the shortage of posts, most of the labor and the wire, ownership of the fence should be vested in Mefford unless Smith shared the moving cost. The only exception made by the chancellor to the “six-foot line” was a few feet on the north end where a gully required a slight modification. That slight change is not here questioned. We hold that the chancellor’s findings were in all respects correct.
Unfortunately, the need for straightening an irregular fence line developed into a dispute over the actual property line. There were three possible true boundary lines: (1) the line from which Smith and Mefford’s predecessor removed the boundary fence; (2) the irregular fence which Smith relied upon in his complaint; and (3) the line fixed by the county surveyor. In that situation our court has many times held that agreements between adjacent landowners as to their boundaries are encouraged. “Convenience, policy, necessity, justice, all unite in favor of such an amicable settlement.” Krutz v. Faught, 204 Ark. 1036, 166 S. W. 2d 655 (1942). Settlement by parol agreement is valid on the principle that the agreement does not pass real estate from one party to another; it merely defines the boundary lines to which the respective deeds extend. Sherman v. King, 71 Ark. 248, 72 S. W. 571 (1903). Mutual concessions by the parties are sufficient consideration. Randleman v. Taylor, 94 Ark. 511, 127 S. W. 723 (1910).
In the fact situation before us, we find a state of uncertainty as to the true boundary line; that there was a bona fide dispute as to its location; and that the parties agreed on a dividing line. The beginning and ending points were marked. Labor and materials were advanced by the parties. Installation of the fence was started and posts were erected extending more than 300 feet.
Restatement, Contracts, § 196 (1) reads as follows: “An oral agreement between owners of adjoining tracts of land fixing a dividing boundary the location of which was honestly disputed, ceases to be within Class IV of § 178 [Statute of Frauds] and becomes enforceable when the agreed boundary has been marked or has been recognized in the subsequent use of the tracts, or when other action has been taken by either party in reliance on the agreement(Italics supplied.)
In Sherman v. King, 71 Ark. 248, 72 S. W. 571 (1903), there was an oral agreement as to a disputed boundary line. All elements of the agreement were performed except the removal “of that portion of the boundary fence that did not conform to the line established between them by this agreement.” This court held that Sherman could hold King to the agreement if he could prove that the land which Sherman sought to recover by suit was within the lines established by the agreement. The case was reversed for lack of sufficient proof on that point; however, this court’s pronouncement became the rule of the case on remand.
In Garvin v. Threlkeld, 190 S. W. 1092 (Ky. 1917), it was said:
“While the validity of parol agreements to settle disputed boundaries was long resisted on . the ground that, in effect, they passed the title to real property without the solemnities required by the statute, it is now settled that, where the dividing line is uncertain and there is a bona fide dispute as to its location and the parties agree on the dividing line and execute the agreement by marking the line or building a fence thereon, such an agreement is not prohibited by the statute of frauds, nor is it within the meaning of the provisions of the law that regulate the manner of conveying real estate.”
The performances by the parties, which we have enumerated, bring the case within the law just recited. Therefore Smith could not rescind the contract by abandoning the construction of the fence.
Affirmed.
Harris, C. J. and Fogleman, J., dissent.