Special Task Force on Practice and Procedure Issues Report

The Arkansas Supreme Court published an interim report of the special task force appointed last year to address several recurring issues in the civil justice system.   Their report includes recommended changes to several important rules, and a discussion of the rationale for the proposed changes.   The Court is now soliciting comments and further reports from the task force before deciding whether to implement the proposed changes.

The full report can be found here:

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/319836/Electronic.aspx

Comments should be submitted in writing to Les Steen, Clerk of the Supreme Court,
Attention: Task Force, Justice Building, 625 Marshall Street, Little Rock, AR 72201. The
comment period shall expire on March 14, 2014.

Here are some verbatim excerpts from the report:

In a per curiam order issued August 2, 2013, the Supreme Court established the Task Force to
consider problems with and recommend changes in the court-adopted procedural rules that
pertain to “parties, liability, and damages in civil litigation involving negligence, medical
malpractice, and related cases.”

The Task Force devoted more time to allocation of nonparty fault than to any other issue but
in the end could not reach consensus. Nevertheless, seven of the nine voting members agreed on
the recommendation included in this report.

In brief, the Task Force recommends adding new provisions to three Rules of Civil
Procedure: Rule 9(h), Rule 49(c), and Rule 52(a)(2). Rule 9(h) would be the exclusive procedural
mechanism for asserting the substantive right to an allocation of nonparty fault under Ark. Code
Ann. §§ 16-60-201 & 16-60-202(c), as amended by Act 1116 of 2013. Like similar rules in other
states, Rule 9(h) requires a defendant to assert a contribution claim for allocation of nonparty fault
in an answer or amended answer.

This pleading requirement assures notice to all parties and must be met if a nonparty’s fault
is to be determined by the trier of fact, as provided in proposed Rules 49(c) and 52(a)(2).
However, it does not apply to a nonparty whose status stems from a settlement with the plaintiff;
by statute, the trier of fact must determine a released joint tortfeasor’s “pro rata share of
responsibility” for the plaintiff’s damages. Ark. Code Ann. § 16-61-204(d).

The proposed additions to Rules 49 and 52 provide that, in actions for personal injury,
medical injury, wrongful death, or property damage, the trier of fact must “determine the fault of
all persons or entities, including those not made parties, who may have joint liability or several
liability” for the alleged harm if: (1) the plaintiff has settled with the nonparty, or the defendant
has given the notice required by Rule 9(h), and (2) the defendant has carried its burden of
establishing a prima facia case of the nonparty’s fault. The italicized language within the quotation
is taken from Ark. Code Ann. § 16-61-201 and is intended to be coextensive with the statute.

Under both rules, apportionment of fault to a nonparty is to be used only for determining
the percentage of fault of the parties, and a finding of fault can neither subject a nonparty to
liability in any action nor be introduced as evidence of liability in any action. These provisions are
based on Section 2 of Act 649 of 2003, the Civil Justice Reform Act. Section 2, codified at Ark.
Code Ann. § 16-55-202, was invalidated on separation-of-powers grounds in Johnson v. Rockwell
Automation, Inc., 2009 Ark. 241, 308 S.W.3d 135 (2009).

Arkansas Supreme Court Applies “Fireman’s Rule” to Bar Recovery for Roadside Assistance Worker

In a decision released today, the Arkansas Supreme Court applied the “fireman’s rule” to bar recovery for an individual employed by the Tennessee Department of Transportation’s HELP (roadside assistance) program when he was killed in a highway crash while attempting to assist a truck driver who had run out of fuel.  The decision is Nowicki v Pigue, 2013 Ark. 499.  Justice Hart wrote the majority opinion.  Justice Danielson and Chief Justice Hannah dissented.

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/319450/Page1.aspx

Speeding Is Intentional Act that Voids Automobile Insurance Coverage

In Safeco v. Southern Farm Bureau, 2013 Ark. App. 696, the Court of Appeals today issued an opinion affirming a jury verdict finding that a teenager driving over the speed limit qualified as an intentional act under the intentional acts exclusion in a Farm Bureau auto liability policy; and therefore Farm Bureau had no duty to defend or indemnify.  The facts are recited at length in the opinion, and the analysis turns on the facts and the standard of review from the jury verdict.  The decision discusses Southern Farm Bureau v. Easter, and purports to distinguish Nationwide v. Lobov.  Also of interest was the fact that “intentional act” was not defined in the jury instructions, and the jurors resorted to a google search for a definition, yet the court found no jury misconduct on appeal.

The implications of this case are staggering.  Facts that were previously evidence of negligence may now trigger an intentional acts exclusion to void coverage altogether.  I expect the Arkansas Supreme Court will be asked to review this decision because of its sweeping impact.

The text of the decision is here:  http://opinions.aoc.arkansas.gov/WebLink8/0/doc/319206/Electronic.aspx

Appeal Dismissed — Post Trial Motion was NOT in Substance a Motion for New Trial

This decision today from the Arkansas Court of Appeals (Virgil v. Morgan, 2013 Ark. App. 675)

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/319091/Electronic.aspx

purports to distinguish Muccio v. Hunt, 2012 Ark. 416, holding that a Rule 59 motion for new trial raised no valid Rule 59 grounds, and was really a motion to reconsider a prior grant of partial summary judgment.  Therefore, the post-verdict motion did not extend the deadline to file a notice of appeal, the notice was untimely, the appellate court lacked jurisdiction, and the appeal was dismissed.

In Muccio, the appellees argued that a “motion for reconsideration” was not a valid motion to extend the notice of appeal time, and that there could be no motion for new trial from a grant of summary judgment (citing New Holland Credit Co., LLC v. Hill, 362 Ark. 329, 336, 208 S.W.3d 191, 196 (2005) (which was overruled by Muccio).  In Muccio, the appellees also argued the “motion for reconsideration” did not raise any valid grounds for relief under Rule 59.   The decision in Muccio: 

http://opinions.aoc.arkansas.gov/WebLink8/ElectronicFile.aspx?docid=309667&dbid=0

Muccio and Virgil agree on one point — “Courts should not be guided blindly by titles but should look to the substance of motions to ascertain what they seek.”  Muccio at 3, citing Cornett, 293 Ark. At 111, 737 S.W.2d at 160, Virgil at 6.(Contra Breeden v. Nebraska Methodist Hospital, 257 Neb. 371 (1999) holding a motion to reconsider grant of summary judgment was not a motion for new trial and did not extend notice of appeal, reasoning that mislabeling the pleading caused confusion and it is not the duty of the court to decipher from ambiguous pleadings the relief requested).

But other than the point of agreement about substance over form, the decisions in Muccio and Virgil are irreconcilable. In Muccio, the Arkansas Supreme Court refused to dismiss the appeal based on the timing of the notice of appeal extended by an improper post-trial motion.  But in Virgil, the Arkansas Court of Appeals dismissed the appeal based on the same argument.

Based on these conflicting decisions, the safest course is to:

1) Avoid post-trial motions.  They are rarely granted, and they will not preserve any issue that was not already preserved.  (It is well settled that our appellate courts will not consider an argument made for the first time in a post-trial motion. Quattlebaum v. McCarver, et al., 2013 Ark. App. 376.)

2) If you must file a post-trial motion, make certain it specifically tracks the grounds for relief in Rule 59.  And call it a Rule 59 (or Rule 60) motion — not a “motion for reconsideration.”

3) Consider filing a notice of appeal within 30 days of the judgment, even if you file a Rule 59 motion.  Then when the Rule 59 motion is denied, or deemed denied, file a second notice of appeal.  If your opponent contends the first notice of appeal denies the trial court jurisdiction to entertain the Rule 59 motion, remind them that jurisdiction does not transfer to the appellate court until the record is lodged.  Vanderpool v. Fidelity & Cas. Ins. Co., 327 Ark. 407 (1997).

If you represent an appellee in a case where there are any post-trial motions and the notice of appeal is filed more than 30 days after the judgment, consider whether the post-trial motion in substance validly extends the notice of appeal time, and whether a motion to dismiss is proper.

 

 

 

Closely Divided Supreme Court Finds Error of Law in Child Support Appeal, but Still Affirms; Trial Counsel’s Efforts Described as “Herculean.”

The Arkansas Supreme Court decided the appeal in Tammye Hall v. Justin Hall by a 4-3 vote last week (September 19, 2013).   A link to the decision and dissent is here:

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/317680/Electronic.aspx

This is the second reported decision in this case.  See Hall v. Hall, 2012 Ark. 429 (Dismissing cross appeal because of voluntary partial payment of judgment).

http://opinions.aoc.arkansas.gov/WebLink8/ElectronicFile.aspx?docid=309809&dbid=0

The Supreme Court recited the trial court’s finding that Justin Hall willfully concealed marital funds in order to decrease the amount of money to be divided in the divorce, and that his actions were egregious, calculated, and a direct affront to the court and to Tammye.  But in addition to the division of hidden marital funds that Tammye won, she was also seeking increased child support based on Justin’s hidden income.  The trial court denied the increase in child support, reasoning that it could not determine if the hidden funds were regular sources of income or one time payments.

All seven Justices agreed this was “clearly a misstatement of the law…” (Id. at 5; Dissent at 4).

Income for purposes of child support is intentionally broad and designed to encompass the widest of sources.  For purposes of child support, even one-time income such as judgments, gifts, retirement payments, and gambling winnings are included as income.  Despite the clearly erroneous statement of law by the trial court, the majority (Danielson, Hannah, Hart, and Hoofman) held that other factors justified the denial of the motion to increase child support, and affirmed.  Specifically, the four-justice majority cited to that fact that Tammye entered into an agreement on child support because she knew it would be difficult to determine Justin’s income from his self-employment (Hall Engineering), and that the fraudulently hidden funds were derived in 2009 and 2010.

The dissent by Justice Goodson (joined by Corbin and Baker) quotes the verbatim language of the trial court’s order, and the arguments made by Tammye on appeal on what the majority characterized as alternative holdings.  First, Tammye raised the fact that her agreement on child support (which was premised on Justin’s fraud) is not binding.  The trial court always has authority to modify child support even if the parties have entered into an agreement.  Rockefeller v. Rockefeller, 335 Ark. 145 (1998).  Tammye also argued that any agreement premised on a fraudulent disclosure is void.

Finally, the majority’s reliance on the date of the hidden income is misplaced.  Tammye and Justin were divorced in March of 2010 (based on an agreement entered in December 2009).   Tammye filed her motion for increased child support in May of 2011.  The majority opinion cites the fact that the hidden income was derived in 2009 and 2010 as justification for denying the motion.  Yet Tammye made a specific argument supported by caselaw that increased child support should be retroactive to the date of the date of the fraud – December 2009.  Administrative Order 10(c) says child support for self-employed payors shall be calculated based on the last two years’ income and the current year’s quarterly estimates.  Applying the Supreme Court’s Administrative Order, Tammye was obligated to produce proof of Justin’s income in 2009 and 2010 to calculate the support due under the chart guidelines for 2011.   The fact that Justin hid income from 2009 and 2010 favors Tammye’s position, not Justin’s.   How could income from 2010 not be relevant to calculating the true support that should have been paid in 2010?

More broadly, it is troubling that this decision may carve out a peculiar fact-based exception to the longstanding policy of the State to protect the interests of children by broadly defining income for child support purposes and preventing litigating parents from bargaining away the support that is due under the law for a child.  It also seems to reward Justin’s fraud by refusing to impute as income for child support purposes the funds he fraudulently hid from Tammye and the trial court.  Perhaps these issues can be clarified if the Supreme Court grants rehearing.

I was pleased to represent Tammye on appeal, but Justice Goodson properly credited Tammye and her trial attorney, Lucas Rowan, on their determination in this case:  “It took a Herculean effort to unravel Justin’s deceit and to produce an accounting of Justin’s income.”  Id. at 5.

Tim Cullen

September 23, 2013

Supreme Court Appoints a Special Task Force

On August 2, 2013, the Arkansas Supreme Court issued a per curiam opinion appointing a ten member task force to:

[r]eceive input on any perceived problems with and recommended changes to the Arkansas Rules of Civil Procedure involving parties, liability, and damages in civil litigation involving negligence, medical malpractice, and related cases.

(http://opinions.aoc.arkansas.gov/WebLink8/0/doc/317064/Electronic.aspx

The per curiam acknowledges political pressure in the last session of the General Assembly, and controversy over recent decisions of the Supreme Court.  No specifics are given, but presumably this is a reference to the confusion that began with the legislative abolition of joint and several liability in the Civil Justice Reform Act of 2003.  The confusion continued when the Court struck down parts (but not all) of the CJRA (Johnson v. Rockwell Automation, Inc., and other cases).  Cases this term (Metheny and Shelton) added pieces to the evolving puzzle, but did not solve it.  The legislature weighed in again with Act 1116, Arkansas Acts of 2013, overruling parts of Shelton (creating a right of allocation of fault among joint tortfeasors).

The per curiam briefly discusses the Civil Practice Committee’s role in vetting changes to the Rules of Civil Procedure, and the history of the bar working together to produce procedures for a fair court system.  The per curiam notes that no one has offered any proposals to the Civil Practice Committee on these issues:  “We note that there have been no recent recommendations submitted to the court or the committee concerning “damages and/or liability in civil litigation.”  Id. at 2.  The per curiam calls this a “failure” of those interested in these issues to submit their concerns to the court.

The task force is directed to submit its report and recommendations by December 31, 2013.

Annual Recommendations of the Committee on Civil Practice

SUPREME COURT OF ARKANSAS — IN RE RECOMMENDATIONS OF
THE COMMITTEE ON CIVIL PRACTICE
Per Curiam Opinion Delivered June 20, 2013
2013 Ark. 278

Click here for the full text: http://opinions.aoc.arkansas.gov/WebLink8/0/doc/316775/Electronic.aspx

This per curiam contains the recommendations of the Supreme Court’s Civil Practice Committee for rule changes.  The per curiam contains the proposed changes in a line-out format so it is easy to see what amendments are proposed.   Many of the changes are minor matters.  One change clarifies that motions in the appellate courts need not be bound like a brief, but can simply be stapled in the corner.   A prior change to Rule 2-1 said that motions had to be bound like a brief, but in practice the clerk’s office preferred that motions only be stapled to make it easier to scan them to a PDF.   Another change requires only one redacted copy of a brief that includes confidential information under Administrative Order 19.    Rule 4-1 and 4-4.   Another change (Rule 4-2) requires that multi-volume briefs be clearly labeled by volume.   The court’s practice that an appeal will not be dismissed upon motions of the parties or notice of settlement if the appeal has been submitted for decision is now codified in Rule 4-4(e).

Rule 6 of the Rules of Appellate Procedure – Civil is amended to say that stipulations or motions to supplement the record must be made within 30 days of the filing of the opening brief.

Rule 9 of the District Court Rules is amended extensively to clarify the process for bringing an appeal from a district court to a circuit court.

Lastly, the committee recommended some changes to the official probate forms.

Comments on the suggested rules changes should be made in writing before July 31, 2013 to:

Leslie W. Steen, Clerk, Supreme Court of Arkansas

Attn.: Civil Procedure Rules

Justice Building

625 Marshall Street

Little Rock, Arkansas 72201

New Cover Sheets Required for Appeals

“The Clerk of the Supreme Court and Court of Appeals is implementing a new case
management system, and in connection with this system, the clerk studied the use of cover
sheets in initiating cases. Cover sheets have been in use in our circuit courts for a number of
years, but they are not required in our appellate courts. The clerk has determined that in
performing the various tasks required when a case is opened and for subsequent case
management, a cover sheet to accompany an initial filing would be beneficial.”

IN RE ADOPTION OF SUPREME COURT AND COURT OF APPEALS RULE 3-7. COVER SHEET, 2013 Ark. 277.

Effective August 1, 2013, any record or initial pleading filed in the appellate court must also include a cover sheet.  The Administrative Office of the Courts will be responsible for the contents and format of the cover sheet.

http://opinions.aoc.arkansas.gov/WebLink8/0/doc/316758/Electronic.aspx

Hollandsworth Presumption Applies to Joint Legal Custody (Based on a 5-4 decision of the Court of Appeals)

The Arkansas Court of Appeals continues to grapple with the application of Hollandsworth v. Knyzweski, 353 Ark. 470, 109 S.W.3d 653 (2003).   Hollandsworth announced a presumption in favor of a custodial parent’s relocation, and that relocation alone would not constitute a material change of circumstances to justify a change of custody.   But even after the Supreme Court’s decision in Hollandsworth, this issue is still the subject of much disagreement, as evidenced by the rare nine-judge decision today from an en banc Arkansas Court of Appeals.

In Bishop v. Singletary, 2013 Ark. App. 394, Judge Wynne was joined by Judges Walmsley, Glover and Hixon, with Judge Brown concurring, in reversing a trial court’s change of custody when the mother proposed to move out-of-state. The mother and father shared joint legal custody, but the mother had primary physical custody.   The trial court ruled that the Hollandsworth presumption did not apply in this circumstance, and granted a change of custody to the father. The five judge majority reversed, finding that the move was not a material change and that the trial court was obligated to apply Hollandsworth, even in a joint legal custody situation.

But four other judges on the court dissented.  Chief Judge Gladwin framed the issue as whether the joint custody arrangement was a question of fact or question of law.  He viewed it as a question of fact, and would affirm based on the standard of review because he could not say the trial court’s decision was clearly erroneous.  Notably, Chief Judge Gladwin’s dissent argues that the Hollandsworth presumption need not apply under these circumstances.

The three remaining judges on the case (Wood, Harrison, and Gruber) joined in a dissent disagreeing with both the majority opinion and Gladwin’s dissent.  Their take on the issue was this:

“Based on the testimony and the decree, the court found that the parents had a true joint-custody arrangement and that neither was entitled to the Hollandsworth presumption.  This finding was not clearly against the preponderance of the evidence, and we should affirm.”

It will be interesting to see if the Supreme Court takes this case on review to attempt to bring some certainty to this issue.  The full text of today’s decision in Bishop v. Singletary is available here: http://opinions.aoc.arkansas.gov/WebLink8/0/doc/316667/Electronic.aspx

New Rule 1-8 Effective August 1, 2013

Starting August 1st, all briefs and motions filed in Arkansas appellate courts must also include a PDF file.   Here is an excerpt from the new rule:

 

(a) Motions, petitions, writs, briefs, responses, and replies filed in the appellate court, except those filed by a party proceeding pro se or by a party who by court order has been allowed to prosecute the suit in forma pauperis, shall be submitted with an electronic copy of those documents in Adobe Portable Document Format (PDF).  Submissions in PDF of circuit court records or parts of records filed in the appellate court is encouraged but not required.  Submission of PDF documents in text-searchable Adobe Portable Document Format is also encouraged by not required.

The new rule also proscribes requirements for naming the electronic file.   For now, section (f) requires the PDF files be submitted on a disc or flash drive.  The Reporters Notes state this is a “transitional step toward the anticipated requirement of electronic filing of documents in the Arkansas appellate courts (See Administrative Order 21 – Electronic Filing).   The full per curiam can be found here: Rule 1-8