injuries suffered or alleged to have been suffered while this policy is in force, including death resulting at any time therefrom by any employé or employés of the assured by reason of the operation of the trade or business described in the said schedule, and to defend the assured and pay expenses and costs subject to the following conditions." The only conditions of the policy necessary to be considered in this opinion are conditions B and D which are as follows: cases hold that until the claim or judgment against the assured has been paid by him, he has sustained no loss, and therefore, he has no claim under a policy insuring him against loss. The policy under examination in Finley v. Casualty Company, supra, was in all essential particulars similar to the one here sued upon, and was held to be a policy against indemnity from loss, and not a policy against indemnity from liability on account of loss. Finley v. Casualty Co. was followed and approved by the later case of Cayard V. Robertson, supra, and we think the rule announced in these two cases is decisive of the present controversy. "Condition B. When any accident occurs the assured shall give immediate written notice thereof to the company at its home office in Macon, Georgia, or to its duly authorized agent. If any claim is made on account of such accident the assured shall give like notice thereof. If any suit is brought to enforce such a claim the assured shall immediately forward to the Counsel for the complainant assumes that company at its home office in Macon, Georgia, relief was denied the complainant in Finley every summons or other process as soon as the v. Casualty Co. on account of a provision in same is served on him, and the company shall the policy there construed similar to condidefend such suit (whether groundless or not) in the name and on behalf of the assured. All extion D of this policy heretofore set out. It penses (legal and otherwise) incurred by the is then argued that by repudiating liability company in defending such suit, and all court in the outset, and refusing to undertake the costs assessed against the assured shall be paid defense of Poag's suit, this defendant insurby the company (whether the verdict is for or against the assured) regardless of the limits of ance company waived the benefit of condition liability expressed in condition N. The assur- D, and should be held liable on the authored shall always give to the company all co-oper-ity of Brick Co. v. Surety Co., 126 Tenn. 402, ation and assistance possible. The company shall have the right to settle any claim or suit at its own cost at any time. "Condition D. No action shall lie against the company under the indemnity clause herein unless brought by and in the name of the assured for loss actually sustained and paid in money by the assured in satisfaction of a judgment after trial of the issue. No action shall lie against the company under any other agreement herein, unless brought by and in the name of the assured for money actually paid by him. In no event shall any action lie against the company, unless brought within two years after the right of action accrues. The company does not prejudice by this condition any defenses to any such action to which it may be entitled." It will be observed that by the terms of this policy the insurance company agrees to indemnify the assured against loss on account of accident covered thereby, and does not agree to indemnify the insured against liability from loss on account of such accidents. This distinction is well recognized in law and has been taken by this court in two cases. Finley v. Casualty Co., 113 Tenn. 592, 83 S. W. 2, 3 Ann. Cas. 962; Cayard v. Robertson, 123 Tenn. 382, 131 S. W. 864, 30 L. R. A. (N. S.) 1224, Ann. Cas. 1912C, 152. In Finley v. Casualty Co., supra, the authorities are reviewed at length, and this court said that under policies insuring against indemnity from loss, "the amount of insurance does not become available until the assured has paid the loss and is not even then available unless proper notice has been given as provided in the policy." As stated above, the assured in this case has not paid the loss, and the authorities approved in Finley v. Casualty Co., and upon which that case rests, hold that such payment is a condition precedent to the maintenance of a suit against the indemnity com 150 S. W. 92, Ann. Cas. 1913E, 107, and St. Louis Dressed Beef & P. Co. v. Maryland Casualty Co., 201 U. S. 173, 26 Sup. Ct. 400, 50 L. Ed. 712. The two cases just mentioned are to the effect that a provision in a policy of this kind, similar to condition D, may not be relied on by an insurance company in certain cases where it has breached its primary obligation under the contract of insurance, and repudiated all responsibility for a claim properly falling within the terms of its contract of indemnity. In both cases the losses were paid by the assured. This court held, in Brick Co. v. Surety Co., supra, when the Surety Company refused to do any of the things it had contracted to do upon notice of an accident included in the terms of the policy issued, that by such action the company breached its contract of insurance and became liable to the insured for the legal consequences of this breach. We held that a provision like condition D did not apply to such a case; that the company had to pay the loss its default had occasioned, and which had been by the Brick Company discharged. We adhere to the rule announced in Brick Co. v. Surety Company. In this case we may eliminate entirely condition D and its effect. We then have a case in which an insurer against loss breached its contract to defend a suit brought against the assured. The contract having been to indemnify against loss, the measure of damages for the breach would be the loss suffered by the assured. As we have heretofore seen, there has been no payment by the assured on account of this accident, and it has therefore sustained no loss. Payment by the assured, loss to the recovery on this policy. This is true, regardless of condition D, and results from the nature of the obligation. For the foregoing reasons, we think the chancellor correctly determined the case in favor of the defendant. The question upon which we decide the case was raised by demurrer, and later by a motion for peremptory instructions. The chancellor directed a verdict in favor of the insurance company, the case having been tried by a jury, but it does not distinctly appear upon what ground he based his action. Several defenses were in terposed by the insurance company. Without passing on the other points in the case, we must hold that payment on account of this loss or judgment against it is a condition precedent to any recovery by the complainant upon the policy here sued on. The chancellor's decree will be affirmed, with costs. Certiorari to Court of Civil Appeals. Suit by Pearl P. Arbuckle, as guardian, etc., against Edith Arbuckle and another, to set aside a sale of certain real property belonging to the minor. Decree of the chancellor confirming the sale was reversed by the Court of Civil Appeals, and defendants bring certiorari. Determination of the Court of Civil Appeals reversed, and that of the chancellor affirmed. Metcalf, Minor & Metcalf, of Memphis, for guardian. W. H. Fitzhugh and James H. Malone, both of Memphis, for ward. LANSDEN, J. This case is before us upon a petition for writs of certiorari to a decree of the Court of Civil Appeals, which reversed the decree of the chancellor confirming an agreed sale between the guardian and the defendant Frazer of an undivided one-sixth interest of a tract of land in which Frazer and Edith Arbuckle, a minor, were tenants in common. ARBUCKLE v. ARBUCKLE et al. It appears that Mrs. Arbuckle is now (Supreme Court of Tennessee. May 23, 1914.) guardian in California of her daughter Edith, 1. GUARDIAN AND WARD (§ 99*) who was nine years old at the time of the WARD'S REAL ESTATE SALE-PURCHASE BY WIT-filing of the original bill, and that they had NESS-STATUTES. Shannon's Code, § 5078, provides that on an application for sale of a ward's real estate the pleading shall set forth fully the age and condition of the ward, what other property, if any, he owns, and the reason why a sale was sought. Section 5088 declares that no guardian, next friend, or witness in such cause shall purchase at such sale, or afterwards until five years from removal of existing disabilities, and, if he does so, the sale shall be void. Held, that only such witnesses are deprived of the right to purchase as resort to their testimony as an artifice to bring about a sale of the infant's property in order that they may purchase, and hence a purchaser within the prohibition must testify to facts which would reflect in some material degree on the jurisdictional facts included in section 5078, and his testimony must have influenced the court's judgment in the decision of those questions. [Ed. Note.-For other cases, see Guardian and Ward, Cent. Dig. § 112; Dec. Dig. § 99.*] 2. GUARDIAN AND WARD (§ 103*) - WARD'S REALTY-PURCHASE BY WITNESS. A witness having purchased certain undivided interests in land agreed with the guardian of a minor owning a one-sixth interest to purchase the same for $500. In proceedings to confirm the sale, the witness was subpoenaed by the guardian and testified that he was familiar with the property, that he owned five-sixths thereof, that he and the minor's guardian, who was an intelligent woman, had contracted for a sale of the minor's interest to a witness for $500, and, though he had paid $1,000 for an undivided one-third interest in the property and $650 for an undivided one-sixth interest, he thought the price he proposed to pay was fair. Held, that such testimony did not bar the witness from purchasing or authorize an avoidance of the sale under Shannon's Code, § 5088, declaring that no witness shall purchase at a guardian's sale, or at any time within five years after the removal of the existing disabilities, etc. [Ed. Note.-For other cases, see Guardian and Ward, Cent. Dig. 88 115, 116; Dec. Dig. § 103.*] removed their residence from Shelby county. Tenn., to Los Angeles, Cal., about one year prior to the filing of the bill. The bill seeks to confirm an agreed sale entered into between Mrs. Arbuckle, as guardian of her daughter, and the defendant Frazer, by which Frazer agreed to pay to the guardian $500 net for the ward's undivided one-sixth interest in the land. The proof is overwhelming that the sale was an advantageous one, because the price offered was the full value of the land, and the guardian was receiving a very small income from the investment in the land, and, she and her daughter having removed to California to reside permanently, it was inconvenient for her to look after the land in Tennessee. This is not questioned. [1] The sole error assigned in the Court of Civil Appeals, and which that court sustained, was that the sale to Frazer was void because he testified in the case as a witness for the guardian in violation of section 5088 of Shannon's Code. Proceedings of the nature of this bill are regulated by chapter 3 of Shannon's Code, § 5072 et seq. Section 5078 requires that the pleadings should set forth "fully and particularly the age, circumstances, and condition of the party under disability; what other property, if any, such person owns, or is in any way entitled to, and the cause or reason why a sale of the particular property is sought." Section 5088 provides: "No guardian, next friend or witness, in such cause, shall purchase at such sale, or at any time afterwards, until five years from the removal of the existing disabilities; and if any such person should make such purchase, the original sale shall become void, and the infant or married woman may bring ejectment for the land, as if no sale had been made." 1 In Starkey v. Hammer, 1 Baxt. 445, it was | the judgment of the court in the decision of those questions. said: "The object of the statute was to prevent purchases by witnesses who had given evidence tending to show the necessity of the sale, and for this purpose they are forbidden to buy, and their purchase declared void, and we can but enforce the provisions of the statute." The case cited also held that the remedy of the infant or a married woman was not limited to ejectment as provided in the statute. The remedy enforced in that case, while not technical ejectment, was in effect so, as it was a bill to remove cloud. In Hunt v. Glenn, 11 Lea, 16, it was said that the purpose of the foregoing section of the Code "is to protect persons under disability from the artifices of persons who may desire to own their property and may resort to unfair means, even upon the witness stand, to bring it to a sale that they may purchase." In that case it was held that a witness who testified only that he agreed with the trustee to purchase, and was willing with the approval of the court to purchase at an agreed price, was not within the prohibited class described by section 5088, Shannon's Code. Certainly such a witness would not fall within the declaration of the purpose of that section of the Code made by the court in Hunt v. Glenn. We hold that the statement of the purpose of the Legislature in enacting the prohibition contained in section 5088 is correctly stated in Hunt v. Glenn. The statement of the legislative purpose made in Starkey v. Hammer was evidently not intended to be full or complete, and isolated from the remainder of the opinion; the statement quoted is too broad, and is certainly not in harmony with the later case of Hunt v. Glenn. Hunt v. Glenn expressly held that it was not every witness who gave testimony in such a case that was prohibited from buying. It is only witnesses who resort to their testimony in the case as an artifice to bring about a sale of the infant's property in order that they may purchase who are forbidden to buy. It is not meant that the artifice itself must appear from the testimony of the witness, or necessarily from extrinsic facts; but it would be sufficient if the witness who afterwards became the purchaser should testify to material facts which it could be seen would reasonably influence the judgment of the court in ordering or confirming a sale. The jurisdictional facts and those which must control the discretion of the court are set out in section 5078, supra, and relate to the age of the minor, his circumstances in life, and his condition, what other property he owns or is entitled to, and the cause or reason why sale of the particular property is sought. A witness who becomes a purchaser, in order to fall within the prohibition of section 5088, must testify to facts which would reflect in some material degree upon the jurisdictional facts included in section 5078, and his testimony must have influenced [2] The witness Frazer testified in substance that he was familiar with this property, and was the owner of five-sixths, and the minor was the owner of the other onesixth; that he and the guardian, who is the minor's mother and an intelligent, competent woman, had made a contract by which he agreed to pay $500 net for the minor's interest in the land, and that he had deposited with the court $25 as earnest money; that he had bought land in the neighborhood of this land both before and since the filing of the bill; that for some of his other purchases he had paid more, and for others he had paid less, than he was agreeing to pay for this land; that he had paid $1,000 for an undivided one-third interest in this particular property, and he had paid $650 for an undivided one-sixth interest; that he thought the price he proposed to pay for this onesixth was fair, and the rental received by the guardian is small. He exhibited with his deposition the correspondence he had had with the guardian, and which resulted in the agreement of sale sought to be confirmed. The Court of Civil Appeals held that the purchase by this witness was void because he testified as above set out. One We think this was error. It should be stated that this witness was called by the guardian, and most all of the facts detailed by him were brought out by counsel representing the guardian. His testimony relates to facts which he could not in good faith have withheld from the court, whether he had been called by the guardian or not. significant fact testified to by him is that only a few months previous to his making the contract with the guardian he purchased a one-sixth undivided interest of the identical tract for $150 more than he proposed to pay for this interest. This evidence would tend to show that it was not to the manifest interest of the minor that the agreed sale be confirmed, and we think it affirmatively negatives any artifice upon the part of the witness to bring the minor's property to sale in order that he might purchase it: We think the testimony of Mr. Frazer clearly shows that he acted in the very best faith, that he made a full and complete disclosure of all facts within his possession, and that he was in possession of material facts which the court should have known. To allow the guardian and ward to avoid this sale upon the ground sustained by the Court of Civil Appeals after the lapse of nearly eight years would be to allow them to use the law and the machinery of the courts as instrumentalities for the perpetration of fraud. As we have said, Mrs. Arbuckle and the defendant Frazer entered into an agree ment for the sale and purchase of this interest in the land involved, and Mrs. Ar buckle, as guardian of her daughter, filed the original bill to have this agreement confirm A. G. Ewing, Jr., City Atty., and F. M. Garard, Asst. City Atty., and H. L. Scott, all of Nashville, for appellants. Jas. C. Bradford and R. T. Smith, both of Nashville, for appellee. ed by the chancellor. She then subpoenaedant, and defendants appeal. Modified and Frazer as a witness, and he testified to the affirmed. facts heretofore detailed by her procurement. He did not volunteer and could not have declined to testify, had he so desired. We are now asked to take away from him the land which he acquired by the decree of the chancellor, notwithstanding that the complainants have his money, and are themselves beyond the jurisdiction of the courts of this state; and the reason for inflicting this injury upon him, which we are asked to approve, is that he testified in the case as a witness called by the guardian. If such a result could be worked out through the courts, it would enable guardians and others occupying similar relationships to perpetrate frauds of the most vicious character. The statute was not intended to apply to such cases. The decree of the Court of Civil Appeals is reversed, and that of the chancellor is affirmed. GREEN, J. The complainant is a private corporation organized under the laws of Tennessee for the purpose of teaching any useful profession, trade, business, or art, and of giving instruction in any branch of learning, practical or theoretical. It was chartered under the provisions of chapter 58, § 3, of the Acts of 1881, Shannon's Code, §§ 21992200. It is a corporation organized for profit, and not an eleemosynary corporation, or corporation organized for general welfare. Ward Seminary has for many years been conducted as a boarding school for girls, and has become quite a famous institution. An attempt was made by the city of Nashville to tax its property within the limits of that city, and this bill was filed to enjoin the WARD SEMINARY FOR YOUNG LADIES v. city from so doing. The complainant claimMAYOR AND CITY COUNCIL OF NASHVILLE et al. (Supreme Court of Tennessee. Nov. 24, 1914.) Const. art. 2, § 28, provides that all property shall be taxed, but the Legislature may except such as may be held and used for purely religious, charitable, scientific, literary, and educational purposes, etc. Acts 1907, c. 602, § 2, subsec. 2, exempts all property belonging to any educational institution when used exclusively for educational purposes, or is unimproved or yields no income, but that all property belonging to such institution used in secular business shall be taxed on its whole or partial value in proportion as the same may be used in competition with secular business. Held, that the words "educational institution" should be construed to mean school, seminary, college, or educational establishment, not necessarily a chartered institution, so as to limit the exemption to educational corporations, and that under such act all property, whether owned by a corporation or a private individual, used exclusively for educational purposes, without reference to whether a profit was made therefrom or not, was exempt from taxation, but vacant real property, used for no purpose connected with the institution and property belonging to the institution, on which stores were erected and rented for business purposes, was subject to taxation. [Ed. Note.-For other cases, see Taxation, Cent. Dig. §§ 394-403; Dec. Dig. § 242.* For other definitions, see Words and Phrases, vol. 3, p. 2317.] Williams, J., dissenting. Appeal from Chancery Court, Davidson County; John Allison, Chancellor. ed to be exempt as an educational institution under a statute that will be hereafter noted. The chancellor rendered a decree in favor of the complainant, and the city of Nashville has appealed to this court. The complainant owned, in addition to its school equipment, several pieces of real estate. Upon some of these were buildings used for dormitories and recitation rooms; some of the land was used for exercise and playgrounds; some was vacant and used for no purpose connected with the school, and . upon some were stores rented out for business purposes. The provisions of our Constitution and of our statute regarding exemption of educational institutions from taxation are as follows: Article 2, section 28, of the Constitution of the state contains this language: "All property, real, personal or mixed, shall be taxed, but the Legislature may except such as may be held by the state, by counties, cities or towns, and used exclusively for public or corporation purposes, and such as may be held and used for purposes purely religious, charitable, scientific, literary or educational, and shall except one thousand dollars' worth of personal property in the hands of each taxpayer, and the direct product of the soil in the hands of the producer, and his immediate vendee." The act of 1907, c. 602, § 2, subsec. 2, contains this exemption from taxation: "All property belonging to any religious, charitable, scientific, or educational institutions when used exclusively for the purpose for which said institution was created, or is unimproved and yields no income. All property belonging to such institution used in secular business and competing with a like business that pays taxes to the state shall be taxed on its whole or partial value in proportion as the same may be used in competition with secular business." Suit by the Ward Seminary for Young Ladies against the Mayor and City Council of Nashville and others, to restrain defendant from imposing a tax upon complainant's The various revenue acts passed since the property on the theory that the same was ex-adoption of the Constitution of 1870 are quite empt from taxation. Judgment for complain- similar in the provisions they contain re For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes specting the exemption of property used for religious, charitable, scientific, literary, and educational purposes. We have only one reported case dealing with an effort to assess the property of educational institutions when that property was actually used for school purposes. This is the case of Mayor, etc., of Nashville v. Ward, 16 Lea, 27. In this case the court construed the Acts of 1882 and 1883. The court held that the act of 1882 exempted from taxation property which belonged to private individuals, if used for educational purposes. It held, however, that the act of 1883 exempted such property only in case it belonged to incorporated institutions of learning, and did not exempt the same if it belonged to private individuals, although used for educational purposes. The latter holding was based on the use of the word "institution" in the act of 1883; the exemption in that act being to property belonging to religious, charitable, scientific, literary, or educational institutions. The court said that the word "institution" meant a chartered institution, or a corporation, and that the exemption, therefore, did not include the property of individuals which might be used for educational purposes. Such is the construction given like acts in most of the states. In a note to Jackson v. Preston, as reported in 21 L. k. A. (N. S.) 165, the annotator says: "In the majority of cases, legislative intent has been construed as including private schools within such terms as 'school,' 'educational institution,' 'seminary,' 'college,' or other similar term, whether such schools are conducted for profit to the owners, or because of charitable or religious considerations, and whether they are incorporated or not incorporated." A number of cases are collected in this note which fully sustain the quotation made. It is not worth while to undertake a re view of the cases from other jurisdictions, since at last the decision of this court must rest upon our own Constitution, statutes, and public policy. Our Constitution of 1870, art. 11, § 12, says: sential to the preservation of republican institu"Knowledge, learning and virtue, being estions, and the diffusion of the opportunities and advantages of education throughout the different portions of the state being highly conducive of the General Assembly in all future periods to the promotion of this end, it shall be the duty of this government, to cherish literature and science." This court said in State v. Fisk University, 87 Tenn. 233, 10 S. W. 284, speaking of the foregoing section: "And while it is true that this language is found in the section which treats of the common school fund, it is not confined to it, but is declaratory of the sense of the constitutional convention on the subject of education, and the duty of subsequent Legislatures to cherish." We think, therefore, in view of this constitutional admonition and the necessity of schools, that it was the intention of the Legislature to exempt property used in educational work, whether such property was owned and such work conducted by individuals or corporations. We know of no one who has accumulated riches in educational endeavor. No abuse is likely to arise if the exemption This construction cannot be adhered to. Such a construction exempts from taxation property belonging to corporations for profit, if used for educational purposes, but holds the property of individuals used for identical purposes liable for such taxes. If subsection 2 of section 2, Acts of 1907, be so construed, it would be clearly unconstitutional. The court has recently considered the question of discrimination between individuals and private corporations in the case of State v. Railroad, 124 Tenn. 16, 135 S. W. 773, Ann. Cas. 1912D, 805, where the authorities are reviewed at length. As pointed out in State v. Railroad, there must be some natural and reasonable basis for discrimination in legislation be confined to property actually used in between individuals and corporations. Such classification must have some natural and reasonable basis. No reason whatever has been suggested for a discrimination between an individual and a corporation for profit, both engaged in educational work, and any attempt of the Legislature to make such a distinction as between the two in the matter of exemption from taxation would be invalid. This court, therefore, cannot suppose that the Legislature had any such intention, unless the language used coerces this conclusion. This question of arbitrary classification was not called to the attention of the court in Mayor, etc., of Nashville v. Ward, supra. We are of opinion, therefore, that the above-quoted provisions of the act of 1907 exempt from taxation all the property of educational institutions, whether the property or the institution be owned by corporations or individuals if the property is ex school work. School-teachers have to live, and their property should not be denied exemption when employed in educational work merely because the owners of the property derive some profit from it. In the great majority of cases, this profit is meager, and not at all commensurate with the work done for the youth of our state and the consequent benefit to the whole body politic. The natural construction of our Constitution and revenue statutes is to exempt from taxation all property physically used for religious, charitable, and educational purposes, or actually occupied for such purposes. We think the words "educational institution” as used in the act of 1907 mean school, seminary, college, or educational establishment, not necessarily a chartered institution. If the word "institution" be interpreted as in Mayor, etc., of Nashville v. Ward, supra, this section of the act, as we have seen, would be unconstitutional, and it is our duty to give |