author: David Newbern, Justice. Donald L. Corbin, Justice, Steele Hays, Justice,

text:
    Kimberly GREEN v. NATIONAL HEALTH LABORATORIES, INCORPORATED; Fort Smith Medical Laboratory; Dr. Gerald A. Stoltz, Jr., M.D.; and Dr. Craig A. Ferris, M.D.
    93-599
    870 S.W.2d 707
    Supreme Court of Arkansas
    Opinion delivered February 14, 1994

      Joel W. Price, for appellant.

      Hardin, Jesson, Dawson & Terry, by: Robert T. Dawson and Carol Woods Frazier, for appellee National Health Laboratories.

      Shaw, Ledbetter, Hornberger, Cogbill & Arnold, by: Charles R. Ledbetter and Gill A. Rogers, for appellee Stolz.

      Bassett Law Firm, by: W. Dale Garrett, for appellee Ferris.
   David Newbern, Justice.

This is a medical malpractice case. Kimberly Green appeals from a summary judgment in favor of an entity named “National Health Laboratories, Incorporated,” a Delaware Corporation, which uses the fictitious name, “Fort Smith Medical Laboratory.” For the remainder of this opinion we will refer to that appellee as “the Laboratory.” Also sued were Doctors Gerald A. Stolz, Jr., and Craig A. Ferris. Summary judgment was also entered in favor of each of the doctors, and they are also appellees. The summary judgment was based on the statute of limitations for medical malpractice, Ark. Code Ann. § 16-114-203 (Supp. 1993). We hold the evidence presented on the issue of whether the statute of limitations barred the claim did not entitle the defendants to a summary judgment.

Affidavits, discovery responses, and pleadings before the Trial Court revealed these facts. In April 1990 Ms. Green, aged 19, visited Dr. Durmon who performed a pap-smear. The doctor sent slides from this examination to the Laboratory for evaluation. Dr. Ferris, on behalf of the Laboratory, reported a need for further examination. Dr. Durmon then performed a colposcopy on Ms. Green, and the results were forwarded to the Laboratory for evaluation.

The results of the colposcopy were examined by Dr. Stolz who concluded the colposcopy detected signs of microinvasive squamous cell carcinoma. Dr. Stolz conferred with Dr. Ferris, his colleague at the Laboratory, who on April 27, 1990, agreed with Dr. Stolz’s opinion. The doctors also agreed to recommend a more invasive conization biopsy of the cervix be performed in order to evaluate the degree of cancer present.

The one-page document stating the diagnosis and recommendation is dated “4-26-90,” and it also has this notation at the bottom of the page, “D/T: 4-30-90 CH.” The record suggests that “D/T” means “date of transcription.” The record does not show when the report was mailed to Dr. Durmon; however, there is evidence that he received it on May 1, 1990.

Ms. Green underwent a conization biopsy of the cervix in May 1990. The results of this biopsy showed the diagnosis from the preceding examinations was in error. No carcinoma was present. Ms. Green, who has since married, alleges the conization surgery was unnecessary and will prevent her from becoming pregnant or from sustaining pregnancy.

The record shows that counsel for Ms. Green gave the Laboratory and Doctor Stolz notice by a letter dated July 25, 1991, that unless a satisfactory settlement could be had he planned to file suit on Ms. Green’s behalf, but suit was not filed until April 30, 1992. The defendants each moved for summary judgment, contending the two-year limitation provided in § 16-114-203 (a) expired before April 30, 1992, and thus Ms. Green’s cause of action was barred. The Trial Court granted the motions.

1. Summary Judgment

A party moving for summary judgment must show “the pleadings, depositions, answers to interrogatories and admissions on file, together with affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Ark. R. Civ. P. 56(c). All proof must be considered in a light most favorable to the non-moving party, and any doubts or inferences must be resolved against the moving party. Tullock v. Eck, 311 Ark. 564, 845 S.W.2d 517 (1993).

The sole issue before us is whether the evidence showed that Dr. Stolz, Dr. Ferris, and the Laboratory were entitled to judgment as a matter of law because the claim against them was barred by the statute of limitations.

2. The statute

Section 16-114-203 provides, in pertinent part:

(a) Except as otherwise provided in this section, all actions for medical injury shall be commenced within two (2) years after the cause of action accrues.
(b) The date of the accrual of the cause of action shall be the date of the wrongful act complained of and no other time.

“Medical injury,” as defined by Ark. Code Ann. § 16-114-201(3) (1987), includes “any adverse consequences arising out of or sustained in the course of the professional services being rendered by a medical care provider, whether resulting from negligence, error, or omission in the performance of such services . . . .”

We have consistently interpreted the limitation in § 16-114-203 strictly, commencing the two year period from the date of the act of alleged malpractice. See Tullock v. Eck, supra; Treat v. Kreutzer, 290 Ark. 532, 720 S.W.2d 716 (1986). While we have adopted the continuous treatment doctrine, Lane v. Lane, 295 Ark. 671, 752 S.W.2d 25 (1988), we have refused to recognize other doctrines which would ameliorate the strictness of the requirement. See Owen v. Wilson, 260 Ark. 21, 537 S.W.2d 543 (1976)(rejection of the continuing tort theory); Williams v. Edmondson, 257 Ark. 837, 520 S.W.2d 260 (1975)(rejection of the discovery rule).

To address this appeal we need not consider those doctrines. Ms. Green contends Dr. Stolz and Dr. Ferris negligently made an erroneous recommendation of the surgery which she contends injured her after an erroneous reading of the results of the colposcopy. When, in the language of the statute, did this alleged “wrongful act” occur?

While the allegedly negligent reading of the specimen occurred, according to the proof, on April 26 and 27, 1990, it was apparently not transcribed or mailed until thereafter. The recommendation for the additional surgery, according to the report, was to aid in the diagnostic process. The language of the “comment” portion of the report was as follows:

In the biopsy specimen from the 11 o’clock area of the cervix, original and deeper sections show at least the presence of microinvasive squamous cell carcinoma. The possibility of a deeper degree of invasion is suggested in one of the sections. A cervical conization is recommended prior to definitive therapy to evaluate the depth of actual invasion.

The conization, which allegedly caused the injury, was done, and the resulting tissue was evaluated by a pathologist at St. Edward Mercy Medical Center. No carcinoma was found. That finding was confirmed by a pathologist at Massachusetts General Hospital.

In addition, evidence was presented that Dr. Stolz, in a telephone conversation with Dr. Durmon which must have occurred after May 1, 1990, the date Dr. Durmon received the report, discussed the matter further and reported that, like Dr. Durmon, he was surprised by the diagnosis contained in his report but had confirmed it with his “partners.”

Under these circumstances, we regard the allegedly negligent recommendation and the communication of it as being part of the “act” of the pathologists in the “course of providing the professional services being rendered” which allegedly injured Ms. Green. As the evidence showed that the communication of the recommendation occurred less than two years prior to the filing of the action, we cannot say the action is barred and that, in the words of Rule 56(c), the defendants were entitled to a judgment as a matter of law.

Reversed and remanded.

Corbin, J., concurs.

Hays, J.. dissents.

Donald L. Corbin, Justice,

concurring. I agree with the majority opinion. I concur only to emphasize that the doctrine of continuing treatment, which we adopted in Lane v. Lane, 295 Ark. 671, 752 S.W.2d 25 (1988) requires the accountability of pathologists and other diagnostic disciplines upon which a treating physician relies. For persuasive authority directly on point, I refer the reader to Fonda v. Paulsen, 363 N.Y.S.2d 841 (N.Y. App. Div. 1975).

Steele Hays, Justice,

dissenting. I believe appellant’s asserted cause of action for medical malpractice had expired under the provisions of Ark. Code Ann. § 16-114-203 (Supp. 1991) when suit was filed on April 30, 1992. Appellees were notified of the claim on July 25, 1991, some nine months before suit was filed, but for some unexplained reason the action was not filed within the time allowed. I believe the trial court ruled correctly and should be affirmed.


source: Caselaw Access Project

author: David Newbern, Justice.

license: Public Domain

text:
    Timothy J. LEATHERS, Commissioner of Revenue for the State of Arkansas v. W.S. COMPTON CO., Inc.
    93-774
    870 S.W.2d 710
    Supreme Court of Arkansas
    Opinion delivered February 14, 1994

      Karen W. Hathaway, for appellant.

      Walter Skelton and Charles J. Buchan, for appellees.
   David Newbern, Justice.

The issue in this appeal is whether the Chancellor erred in enjoining the Commissioner of Revenue, who is the appellant, from releasing information about the cigarette “stamp deputy allowance.” Cigarette wholesalers place tax stamps on packages of cigarettes before they are sold to retailers. In return, they receive a commission, known as the “stamp deputy allowance,” from the Revenue Department. The McLane Company, Inc., a wholesale company operating elsewhere, requested from the Commissioner figures showing how much commission had been paid to each wholesaler in Arkansas. All of the Arkansas companies in the wholesale cigarette business sought the injunction. They are the appellees. The Chancellor held that, because it would confer “advantage” upon a competitor, the release of the information was precluded by the applicable statute and thus to be enjoined. The decision is affirmed.

1. The statute

Arkansas Code Ann. § 26-18-303 (Supp. 1993) deals with the disclosure of tax information. It provides for nondisclosure of certain items of tax information but, in subsection (b)( 11), exempts from nondisclosure commissions paid to taxpayers for stamp sales. In subsection (b)(ll)(Q), however, the following appears:

.... Provided, however, information which is subject to disclosure under the provisions of subdivision (b)(ll) shall not be disclosed if such information would give advantage to competitors or bidders, or such information is exempt from disclosure under any other provision of law which exempts specified information from disclosure under any such law.

Subsection (g) then provides:

(1) The director shall promulgate such regulations as are necessary to establish a reasonable procedure for making requests for and release of information under subdivision (b)( 11) of this section, for allowing a taxpayer reasonable notice in advance of the release of the requested information, for a period of time up to seven (7) days from the date a request for information is made to provide notice and make necessary determinations, and to provide the methods by which the director shall determine if the information requested is subject to disclosure under Arkansas law.
(2) The provisions of the section shall solely govern the release of information under subdivision (b)(ll) and the release of information shall not be subject to the Freedom of Information Act of 1967, § 25-19-101 et seq.

The Commissioner’s brief analogizes to, and cites cases interpreting, the Freedom of Information Act. In view of the clear statutory provision that the Freedom of Information Act is inapplicable, the argument and citations are not apt.

Just as the Chancellor, we are relegated to deciding the meaning of that part of the language of § 26-18-303 which says, “... shall not be disclosed if such information would give advantage to competitors or bidders.” We have not had any previous occasion to interpret that language.

When the language of a statute is plain and unambiguous, we give the language its plain and ordinary meaning. Omega Tube & Conduit Corp. v. Maples, 312 Ark. 489, 850 S.W.2d 317 (1993); City of Fort Smith v. Tate, 311 Ark. 405, 844 S.W.2d 356 (1992). If a statute is clear and unambiguous, the primary concern is with what the document says and not what its drafters may have intended. Omega Tube & Conduit Corp. v. Maples, supra; Mourot v. Arkansas Bd. of Dispensing Opticians, 285 Ark. 128, 685 S.W.2d 502 (1985).

The Commissioner has interpreted § 26-18-303(b)(ll)(Q) in Revenue Regulation 1991-7, which is entitled “Disclosable Tax Information.” It states that the information will not be released unless the taxpayer shows release of the information would result in “substantial harm to the taxpayer’s competitive position.”

If the language of a statute is ambiguous, the manner in which it has been interpreted by executive and administrative officers is to be given consideration and will not be disregarded unless it is clearly wrong. Omega Tube & Conduit Corp. v. Maples, supra; Morris v. Torch Club, Inc., 278 Ark. 285, 645 S.W.2d 938 (1983); Walnut Grove Sch. Dist. No. 6 v. County Bd. of Education, 204 Ark. 354, 162 S.W.2d 64 (1942). The language in § 26-18-303(b)(ll)(Q), is, however, not ambiguous and thus must be given its plain and ordinary meaning as written. Mourot v. Arkansas Bd. of Dispensing Opticians, supra. If the General Assembly had meant to add to the simple language “would give advantage to competitors,” it could easily have done so. See Amason v. City’ of El Dorado, 281 Ark. 50, 661 S.W.2d 364 (1983).

We affirm the Chancellor’s ruling that “advantage to competitors” means “any advantage” as it is simply n.ot otherwise limited.

2. Competitive advantage

The Chancellor found that using the information in conjunction with other available information would give valuable information to a competitor. There was evidence before her that a competitor could use the information sought to gain an advantage enabling it to determine whether it would be worthwhile to target a particular wholesaler for competition. The Commissioner argues that release of the stamp deputy allowance information alone would not give a competitive advantage to McLane. We disagree and affirm the Chancellor’s finding that release of the information would confer advantage on a competitor.

We review chancery cases de novo but will not reverse the findings of fact by the Chancellor unless they are clearly erroneous. Brasel v. Brasel, 313 Ark. 337, 854 S.W.2d 346 (1993). We give due regard to the superior position of the Chancellor to judge the credibility of the witnesses. Ark. R. Civ. R 52(a); Brasel v. Brasel, supra. We consider the evidence in the light most favorable to the appellee. Guaranty’ Nat’l Ins. v. Denver Roller, Inc., 313 Ark. 128, 854 S.W.2d 312 (1993). The burden is upon the appellant to show that the findings are erroneous. Burson v. Day, 284 Ark. 515, 683 S.W.2d 917 (1985).

Bob Douglas, an Arkansas wholesaler, testified that McLane is a large, strong company in the business of wholesaling cigarettes. The profit margin on cigarettes is small and thus dependent on volume. The stamp deputy allowance information could be used by McLane in conjunction with other reports to determine the market share of a wholesaler in a particular area. By a process of extrapolation McLane could learn the share of a wholesaler’s gross profits attributable to cigarette sales. Having that information, McLane could know the extent of a wholesaler’s business attributable to other items such as candy and thus know what it would take to undercut prices on those other items sufficiently to take away customers or run the wholesaler out of business. Mr. Douglas’s testimony was not refuted by any other witnesses, and we hold it sufficient to support the Chancellor’s decision.

Affirmed.


author: Per Curiam.

text:
    Kenneth KELLY v. STATE of Arkansas
    CR 94-97
    871 S.W.2d 331
    Supreme Court of Arkansas
    Opinion delivered February 14, 1994

      Keith Watkins, for appellant.
    No response.
   Per Curiam.

Appellant, Kenneth Kelly, by his attorney, Keith Watkins, has filed a motion for a belated appeal and for a Rule on the Clerk. The record was refused when tendered to the clerk because the notice of appeal was not timely filed.

Appellant’s attorney, Keith Watkins, admits that the failure to give a timely notice of appeal was due to his personal neglect.

We hold that such an error, admittedly made by the attorney for a criminal defendant, constitutes ineffective assistance of counsel and is good cause to grant the motion. See Weaver v. Stat, 304 Ark. 77, 798 S.W.2d 925 (1990).

A copy of this order will be forwarded to the Committee on Professional Conduct.


author: Jack Holt, Jr., Chief Justice.

text:
    Terry Wayne SWANIGAN v. STATE of Arkansas
    CR 93-1127
    870 S.W.2d 712
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994

      William R. Simpson, Jr., Public Defender, by: Sandra S. Cordi, Deputy Public Defender, for appellant.

      Winston Bryant, Att’y Gen., by: Kent G. Holt, Asst. Att’y Gen., for appellee.
   Jack Holt, Jr., Chief Justice.

The appellant, Terry Wayne Swanigan, raises a single point on appeal from his criminal conviction of the offense of first-degree murder and his sentence of life imprisonment, contending that the trial court erred in failing to exclude the testimony of a witness for violation of Ark. R. Evid. 615. His argument has no merit, and the judgment of the trial court is affirmed.

Swanigan was charged with capital murder in the December 1992 shooting death of Lewis Allen, a fourteen-year-old. The State waived the death penalty, and, following a jury trial, Swanigan was found guilty of first-degree murder and was sentenced to life imprisonment.

Evidence presented at trial indicated that, before the murder, Swanigan and the victim, Allen, encountered each other on a street near The Meat Store, a Little Rock butcher shop and grocery store. According to Tim Henderson, a friend who was walking with Allen and Andre Williams, another youth, to the store, the trio saw Swanigan talking to someone in a truck. He pulled off his jacket and walked toward them as if he wanted to fight.

When Swanigan approached the three youths, witness Henderson testified, Allen put his hand in his coat, as if he had a gun (although the witness claimed never to have seen one), and said to Swanigan, “I don’t think that you want to step.” Another witness, Everett Lauderdale, testified that after the confrontation, Swanigan went to his house, which was near The Meat Store.

Meanwhile, Allen, Henderson, and Williams entered the shop. They were soon followed by Swanigan, carrying a pistol, which, according to Henderson, Swanigan pointed in Allen’s face, saying, “What’s up, n___? What’s up now? Where your gun at now?” According to another witness, Cody Nelson, an employee of The Meat Store, a struggle ensued over the gun. At that point, Nelson testified, he heard Swanigan say to Allen, “Punk, I’ll kill your m__-f___ass.” In the scuffle, Allen fell backwards, and Swanigan fired at him. Witness Henderson stated that three shots were fired in the store and that Allen attempted to escape through the front door. He collapsed on a sidewalk outside and died from a gunshot wound in the chest.

I. Violation of Ark. R. Evid. 615

On appeal from his first-degree murder conviction, Swanigan argues that the trial court committed reversible error in denying the defense motion to strike the testimony of prosecution witness Cody Nelson for violation of Ark. R. Evid. 615, the witness-exclusion rule. That rule provides, in relevant part: “At the request of a party the court shall order witnesses excluded so that they cannot hear the testimony of other witnesses, and it may make the order of its own motion.”

During cross-examination of witness Nelson, who was working in The Meat Store at the time of the shooting, defense counsel inquired about the presence of other people near the meat counter:

Q Were there other people working back there?
A Yeah.
Q Who was?
A Antoine Young.
Q Antoine Young. Is there anyone else working back there?
A No.
Q All right. Didn’t you have a customer there?
A Yeah.
Q Okay.
A That’s not— He said this, that’s what I heard, but I’m not sure.
Q Okay. So you—
A He told me he had a customer, but I wasn’t—
Q When did he tell you that?
A He told me— Well, he told me today.
Q Today?
A Yes.
Q When were y’all discussing the testimony about this?
A It was probably when we went to lunch.
Q When you went to lunch? Okay.

At that, the defense attorney requested permission to approach the bench, and the following discussion occurred:

MR. SALLINGS: Your Honor, the Court instructed the witnesses this morning not to discuss the case or the testimony, and I would move to strike this witness’ testimony based .on discussing it with other witnesses back in the Witness Room against the Court’s order.
THE COURT: Has there been any change in the testimony? Has there been any prejudice in this regard?
MR. SALLINGS: I believe there’s already evidence that he’s testified to some things that he— not necessarily what he knew, but what someone told him back there.
THE COURT: Counsel, that’ll be denied. As for striking the testimony, as for a petition for a continuance, if you want to file that later, we’ll consider that, but your Motion to Strike his testimony is going to be denied.

Although Antoine Young had apparently been subpoenaed as a potential witness, he was never called to testify.

This court had the occasion, in Blaylock v. Strecker, 291 Ark. 340, 724 S.W.2d 470 (1987), to examine Ark. R. Evid. 615 and to address its operation and application exhaustively. There we held that a trial court has very narrow discretion to exclude the testimony of a witness for noncompliance with an exclusion order pursuant to Rule 615. A trial judge can exercise that narrow discretion to exclude a witness’s testimony only when the noncompliance is had with the consent, connivance, or procurement of a party or his attorney. Id. The violation by a witness of the rule of sequestration through no fault of, or complicity with, the party calling him, should go to the credibility rather than to the competency of the witness. Id.

In the Blaylock opinion, we cited Norris v. State, 259 Ark. 755, 536 S.W.2d 298 (1976), and Williams v. State, 258 Ark. 207, 523 S.W.2d 377 (1975), for the controlling rationale regarding the rarely exercised discretion to exclude testimony for noncompliance with Rule 615. We stated that, with the offending witness subject to punishment for contempt and the adverse party free to raise the issue of credibility in argument to the jury, the party who is innocent of the rule’s violation should not ordinarily be deprived of the testimony.

The standard of narrow discretion, we noted in Blaylock v. Strecker, “remains as it has been for many years.” 291 Ark. at 345, 724 S.W.2d at 473. We have not changed our stance in subsequent decisions, nor do we see any reason to change it now. See Porter v. State, 308 Ark. 137, 823 S.W.2d 846 (1992); Ford v. State, 296 Ark. 8, 753 S.W.2d 258 (1988); Daniels v. State, 293 Ark. 422, 739 S.W.2d 135 (1987).

There are three possible methods of enforcement of an exclusion order that are available to a trial judge: (1) citing the witness for contempt; (2) permitting comment on the witness’s noncompliance in order to reflect on his credibility; and (3) refusing to let the witness testify. Blaylock v. Strecker, supra. In the following portion of cross-examination, which occurred directly after the trial court refused to strike witness Nelson’s testimony, defense counsel pursued the possibility of further noncompliance with the rule and raised the issue of credibility:

Q Okay. Who else did you talk with about your testimony at lunch?
A Nobody.
Q Nobody else? Anything that you’ve testified to on direct examination that maybe you didn’t really remember, but someone told you since the date this happened?
A No. No.
Q Okay. So, you don’t remember if there was another person there at the counter or not?
A No.

Defense counsel was not only able to comment, in the course of his questioning, about the reliability of witness Nelson’s testimony, but he was also able to establish the fact that the witness did not remember whether another person was present at the meat counter. This court has held that even when there has been a clear violation of Rule 615, the trial court does not abuse its discretion in permitting the witness’s testimony when exercising its option of allowing comment on the witness’s violation in order to reflect on his credibility. See Graham v. State, 296 Ark. 400, 757 S.W.2d 538 (1988). Indeed, the trial court’s discretion is more readily abused by excluding the testimony than by admitting it. Ford v. State, supra.

Clearly, witness Nelson’s violation of the rule was not accomplished through the consent, connivance, or procurement of the State. His testimony regarding his noncompliance was elicited on cross-examination by the defense attorney, who immediately, upon the court’s refusal of his motion to strike, repaired whatever damage may have been done by inquiring about other aspects of testimony that witness Nelson “didn’t really remember” and by securing the witness’s acknowledgment that he didn’t remember if another person was standing by the meat counter. (Subsequently, the defense counsel devoted considerable attention on recross-examination to inconsistencies in witness Nelson’s statements about what he actually saw at the time of the shooting.)

As the trial court specifically noted by its question addressed to counsel at the time the motion to strike was made, there was no showing of prejudice. Other witnesses testified to essentially the same sequence of events, though there was some dispute as to whether Lewis Allen actually threatened Swanigan with a gun during the encounter on the street. It is the jury’s province to resolve any contradictions, conflicts, and inconsistencies in a witness’s testimony. Franklin v. State, 308 Ark. 539, 825 S.W.2d 263 (1992); Abdullah v. State, 301 Ark. 235, 783 S.W.2d 58 (1990).

In short, the trial court did not err in refusing to strike the testimony of witness Nelson for noncompliance with Ark. R. Evid. 615.

II. Compliance with Supreme Court Rule 4-3(h)

The State, in compliance with Rule 4-3(h) of the Rules of the Arkansas Supreme Court, has searched the record for objections decided adversely to the appellant and has included one pertaining to an objection made by the Deputy Public Defender during the State’s closing argument concerning a negative reflection on defense counsel’s credibility. Other objections are covered in the appellant’s abstract. None involves prejudicial error.

Affirmed.


author: Robert H. Dudley, Justice; Steele Hays, Justice, dissenting.

text:
    Jim C. PLEDGER, Director, Arkansas Department of Finance and Administration v. C.B. FORM COMPANY
    93-844
    871 S.W.2d 333
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994

      Ricky L. Pruett, for appellant.

      Kinard, Crane & Butler, and Woodward & Epley, by; Michael G. Epley, for appellee.
   Robert H. Dudley, Justice;

This case involves the interpretation and construction of the Arkansas Gross Receipts Act of 1941, as amended.The chancellor ruled that the taxpayer’s manufacture of forms, or molds, is exempt from the gross receipts, or sales, tax. We affirm.

The taxpayer, C.B. Form Company, manufactures plaster and cardboard forms for sale to its sole customer, American Fuel Cell and Coated Fabrics Company, or Amfuel. Amfuel utilizes the forms to build fuel cells that fit into a cavity in the wing and fuselage of military and commercial aircraft. In manufacturing the fuel cells, Amfuel applies a precut rubber sheeting or coated fabric to the exterior surface of the form. Two or more plies may be used. This creates an uncured, or green, fuel cell. The green cell and the form inside it are placed in a large autoclave to complete the adhesion process and make one integral unit of the rubber coated fabric. The heat and pressure of the autoclave, in combination with the form within the fuel cell, cause the uncured cell to acquire its permanent physical shape and characteristics. After curing, the cell and its form are submerged in a hot water vat to soften the interior plaster or cardboard form. The form is removed piece by piece through openings in the cell for fuel lines or refueling portals. The cardboard or plaster form is completely destroyed during removal and is hauled to a landfill as unusable waste. The interior of the fuel cell is inspected and packaged for shipment to the customer.

The taxpayer thought that its forms were exempt from the sales tax under that part of the machinery and equipment exemption that provides an exemption for molds and dies, and filed a claim under the Arkansas Tax Procedure Act for a sales tax refund of slightly more than $86,000. The Revenue Legal Counsel of the Department of Finance and Administration denied the claim for refund. The taxpayer filed suit in chancery court and alleged that the Department had erroneously denied its claim for the refund. The case was submitted to the chancellor on a stipulation of facts. The chancellor ruled that the forms came within the exemption that provides for “molds . . . that determine the physical characteristics of the finished product.” See Ark. Code Ann. § 26-52-402(c)(2)(B)(i) (Repl. 1992).

Our standard of review of these cases is well settled. The taxpayer must establish an entitlement to an exemption from taxation beyond a reasonable doubt. Pledger v. Baldor Int’l, 309 Ark. 47, 827 S.W.2d 646 (1992). A strong presumption operates in favor of the taxing power. Ragland v. General Tire & Rubber Co., Inc. 297 Ark. 394, 763 S.W.2d 70 (1989). Tax exemptions are strictly construed against the exemption, and we have written that “to doubt is to deny the exemption.” Baldor, 309 Ark. at 33, 827 S.W.2d at 648. We review tax cases de novo. Pledger v. Easco Hand Tools, Inc., 304 Ark. 30, 800 S.W.2d 690 (1990).

The chancellor based his ruling on the following sub-parts of the applicable statute, Ark. Code Ann § 26-52-402:

There is specifically exempted from the tax imposed by this act, the following:
(1) (A) Gross receipts . .. derived from the sale of tangible personal property consisting of machinery and equipment used directly in producing, manufacturing, fabricating . . . articles of commerce at manufacturing . .. plants ... in the State of Arkansas. . . .
(2) (B) Machinery and equipment ‘used directly’ in the manufacturing process shall include, but shall not be limited to, the following:
(i) Molds and dies that determine the physical characteristics of the finished product or its packaging material.

Ark. Code Ann. § 26-52-402(a) (Repl. 1992) (emphasis added).

The Department makes four assignments of error. The first of these is essentially a non-issue. In it, the Department argues that the forms do not qualify for an exemption as items of tangible personal property sold for resale under Ark. Code Ann. § 26-52-401(12)(a) (Supp. 1993). The chancellor did not rely on this subsection of the statute, and the taxpayer readily concedes the point. Instead, the taxpayer seeks to claim the exemption under the “mold and die” exemption quoted above. We address the point only to make clear the distinction between the two statutes.

Section 26-52-401 exempts from the collection of sales or use tax, gross proceeds on products that are sold for resale. The purpose of this statute is to prevent double taxation. Hervey v. Southern Wooden Box, 253 Ark. 290, 486 S.W.2d 65 (1972). Subsection (12)(B) allows property sold for use in manufacturing to be classified as having been sold for resale if the property “becomes a recognizable, integral part of the manufactured . . . product.” Items that are destroyed or disposed of in the manufacturing process do not qualify for this exemption because if they are destroyed there is no possibility of double taxation. See Ragland v. General Tire & Rubber Co., 297 Ark. 394, 763 S.W.2d 70 (1989). The forms manufactured by the taxpayer in this case do not become a “recognizable and integral” part of the finished fuel cell. If the taxpayer were claiming an exemption under this statute, it would be denied.

A different section, section 26-52-402, provides the exemption for machinery and equipment used directly in the manufacturing process. The purpose of this “machinery and equipment” statute is “to encourage capital investment in industrial, utility and manufacturing enterprises” for the “industrial development of the State.” See Act 113 of 1967 (codified at Ark. Code Ann. § 26-52-402 (Repl. 1992)) (emergency clause). Section 26-52-402(a)(2)(C) provides that the machinery and equipment exemptions are “incentives to encourage the location of new manufacturing plants in Arkansas, the expansion of existing manufacturing plants in Arkansas, and the modernization of existing manufacturing plants in Arkansas through the replacement of old, inefficient, or technologically obsolete machinery and equipment.” The taxpayer contends it is entitled to the exemption under the subsection of this statute that exempts from taxation “molds and dies that determine the physical characteristics of the finished product.” Ark. Code Ann. § 26-52-402(c)(2)(B)(i) (Repl. 1992).

The heart of the Department’s appeal lies in its second assignment of error. It argues that the taxpayer is not entitled to an exemption under the mold and die exemption, at section 26-52-402(c)(2)(B)(i). There is no dispute about the facts. The parties stipulated that the “words ‘form’ and ‘mold’ are used interchangeably in the industry,” and the Department acknowledges that the forms “determine the physical characteristics of the fuel cells.” The Department argues that the chancellor erred as a matter of law in ruling that the forms come within the exemption for “molds and dies that determine the physical characteristics of the finished product.”

The Department contends that, pursuant to our cases, a mold must have continuing utility and be dynamic to qualify as machinery and equipment. It argues that since these molds are destroyed, they have no continuing utility, and are not dynamic and, therefore, do not qualify for the exemption. The argument misses the point that the forms come within the express language of the exemption for “molds and dies that determine the physical characteristics of the finished product.”

The .statute provides an exemption for molds that determine the physical characteristics of the finished product. It does not require that they be permanent. We have often written that legislative intent must be gathered from the plain meaning of the language used in an act. Roy v. Farmers & Merchants Inc. Co., 307 Ark. 213, 819 S.W.2d 2 (1991). The meaning of the words used in mold and die exemption is clear: There is an exemption for molds that determine the physical characteristics of the finished product. In addition, when the sentence in the subsection exempting molds is read in full, it appears that the Department’s argument is contrary to the expressed legislative intent. The full sentence providing the exemption is “Molds and dies that determine the physical characteristics of the finished product or its packaging material” Ark. Code Ann. § 26-52-402(c)(2)(B)(i) (emphasis added). Packaging material would not ordinarily have continuing utility. There is no expressed legislative intent to construe the statute as proposed by the Department.

The Department’s argument that equipment or machinery must have “continuing utility” had its genesis in our case of Ragland v. Dumas, 292 Ark. 515, 732 S.W.2d 118 (1987). In that case the trial court ruled that gravel, which was used as a base for a temporary road to an oil extraction project, was exempt under section 26-52-402 as “equipment” used directly in the process of extracting oil. We reversed and held that the term “equipment” did not include gravel used on a temporary road. We noted that the term “equipment” was not defined in the statute, and is “an exceedingly elastic term, the meaning of which depends on context.” Id. at 520, 732 S.W.2d at 120. We then looked at definitions of the term and held that gravel did not fit within any of them. One of the reasons for this holding was that the gravel had no continuing utility after the oil-extraction project ended. Id. Unlike the statute applicable to that case, the subsection of the statute applicable to the case at bar specifically defines molds that determine the physical characteristics of the finished product as “machinery and equipment.” Thus, under the language of the statute, it is not necessary that molds have a “continuing utility” to come within the statutory definition of equipment.

The Department similarly argues that molds cannot come within the mold and die exception unless they also fall within the definition of “machinery” that we set out in Heath v. Research-Cottrell, Inc., 258 Ark. 813, 529 S.W.2d 336 (1975). In that case, the taxpayer sought an exemption for a cooling tower as machinery under section 26-52-402. The statute did not define the term “machinery” and we construed it to mean something dynamic. Contrary to the statute involved in that case, the subsection of the statute applicable to the case at bar defines molds that determine the physical characteristics of the finished product as “machinery and equipment.” Again, the forms at issue fit within the express language of the statute as “machinery and equipment.”

The Department’s third assignment is valid, but does not change the result of the case. In his letter opinion, the chancellor erroneously referred to section 26-52-402(c)(2)(B)(iv) as additional authority for his ruling in this case. The Director correctly points out that the subsection cited by the chancellor refers to an exemption for the machinery and equipment producing chemical catalysts and solutions, but not to the chemicals and solutions themselves. Thus, the cited subsection does not give an additional reason to support the chancellor’s ruling. Even so, the result of the case is the same since we affirm the ruling on the ground that the taxpayer clearly comes within the mold and die exception as set out above.

In its final argument the Department contends that, even if the taxpayer’s forms fit within the definition of “molds and dies,” they still do not qualify for an exemption because the statute only exempts an initial purchase, or a complete replacement, of a machine or equipment. The Department’s argument is correct in its assertion that only new or replacement machines or equipment are exempt, and that repairs are not exempt. See Ark. Code Ann. §§ 26-52-402(a)(l)(B) and (2)(A)-(B). Even so, the forms in this case clearly come within the language of the mold and die exception, whether they be classed as initial purchases or replacement molds.

In this same argument, the Department contends that the taxpayer is limited to an exemption for the initial mold, and not for replacement molds because Arkansas Gross Receipts Tax Regulation GR-56 requires sellers of molds and dies to collect a tax upon replacement molds and dies that are sold to be used with power units. The director contends that since these molds are not part of a machine they “fail to satisfy an initial requirement for exemption” under the regulation. The argument is without merit for either of two reasons. First, the argument was not raised below, and we will not consider an argument for the first time on appeal. Second, if the Department is seeking to use its power of regulation to impose a requirement that a mold be a part of a power unit in order to be exempt, it has exceeded its authority. An administrative regulation cannot be contrary to a statute. See State v. Burnett, 200 Ark. 655, 140 S.W.2d 673 (1940). The statute provides an exemption for the molds.

Affirmed.

Hays and Brown, JJ., dissent.

Steele Hays, Justice, dissenting.

Admittedly, it is not entirely clear the legislature did not intend the words “molds and dies” to apply to the forms produced by C.B. Form Company (Company) and used by its sole customer, Amfuel, to produce fuel cells. But neither is it clear that the legislature did so intend and, unfortunately for the Company, that is the stringent test it must surpass to prevail in this litigation. In fact, in order to qualify for the exemption the Company must establish beyond a reasonable doubt that such was the intent of the legislature. Ragland v. General Tire and Rubber Co., 297 Ark. 394, 763 S.W.2d 70 (1989); Heath v. Westark Poultry Processing Corp., 259 Ark. 141, 531 S.W.2d 953 (1976). This case, perhaps more than any other in recent memory, illustrates the maxim applicable to taxation exemption: “to doubt is to deny the exemption.” Pledger v. Baldor International, Inc., 309 Ark. 30, 827 S.W.2d 646 (1992). I respectfully suggest the majority is resolving a doubtful issue against the taxing authority — the State of Arkansas — and strictly construing the exemption in favor of the Company, exactly the reverse of settled law.

In its baste to judgment the majority equates the words ‘mold’ and ‘form’ and effectively decides the case on that basis. The words may be used interchangeably in the industry, but that is not true of the Company, where the word ‘form’ is consistently used to refer to the disposable device now in dispute and the word ‘mold’ is used, in contradistinction, to refer to a reusable fiberglass structure utilized by the Company to produce the ‘form.’ I submit that the reusable device — the mold — meets the statutory test but that the nonreusable device — the form — does not.

If one looks no farther than the words “molds and dies that determine the physical characteristics of the finished product. . .” the exemption might seem warranted. But to conclude that the form in this case is synonymous with ‘mold,’ as used in the statute, greatly over simplifies a complex issue.

The key words of the statute are “machinery and equipment” and “molds and dies.” Certainly the ‘form’ in this case determines the physical characteristics of the finished product — the fuel cell. But is that conclusive of the issue being decided? I think not. I submit that a ‘mold,’ used in conjunction with the word ‘die,’ when strictly construed against the exemption, contemplates a device which has an ongoing function in the manufacture of a particular product, as opposed to a cardboard structure which, once used, is torn from the product piece by piece and discarded as unusable waste.

Admittedly, the statute does not require that molds and dies be permanent. But the two words are linked together in the conjunctive, suggesting a correlation, rather than in the disjunctive, and the word ‘die’ plainly contemplates an industrial device which is reusable over an extended life. The word is defined as “any of various devices for cutting or forming materials in a press or a stamping or forging machine;” “a hollow device of steel,” “a steel block or plate.” In this context it is far more plausible that by using the words “molds and dies” (under the broader heading of “machinery and equipment”) the legislature was referring to devices characteristically similar and having a useful life in the manufacturing process. Indeed, we have recognized that the language used in our statute requires a “continuing utility” in order for the exemption to attach. Ragland v. Dumas, 292 Ark. 515, 732 S.W.2d 119 (1987).

Other states have interpreted the language of similar tax exemption statutes accordingly: See, e.g., Midwestern Press, Inc. v. Commissioner of Taxation, 203 N.W.2d 344, 295 Minn. 59 (1972) (lithographic plates custom made for particular printing jobs, usable for only a limited number of impressions and then scrapped, were not “machinery” for the purposes of tax exemption); Hasbro Industries, Inc. v. Norbug, R.I., 487 A.2d 124 (1985) (the “machinery” tax exemption not applicable to clay models); Great Western Sugar Co. v. U.S., 452 F.2d 1394 (1972) (metal plates with a cutting edge used to cut sugar beets into thin slices not entitled to tax exemption applicable to “machinery used in the manufacture of sugar”); Morgan County Feeders, Inc. v. McCormick, 836 P.2d 1051 (Colo. App. 1992)(goods used in business are “equipment” when they have identifiable units and a relatively long period of use.)

Being unable to eliminate all reasonable doubt that the legislature intended the exemption in this instance, I would reverse.

Brown, J., joins in this dissent.


author: Robert H. Dudley, Justice.

text:
    William R. SMITH v. STATE of Arkansas
    CR 91-294
    870 S.W.2d 716
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994
    [Rehearing denied April 11, 1994.]

      Keith Carle, for appellant.

      Winston Bryant, Att’y Gen., by: J. Brent Standridge, Asst. Att’y Gen., for appellee.
   Robert H. Dudley, Justice.

On February 26, 1991, appellant was convicted in municipal court of a misdemeanor. On March 25, 1991, he filed a motion in circuit court and asked to prosecute a limited appeal to that court as a pauper. On May 10, 1991, the circuit court denied the motion. On May 30, 1991, more than ninety days after the date of conviction, appellant filed in circuit court his notice of appeal, along with the municipal court record. His appeal asked only that the circuit court review a motion to suppress evidence that he had filed in municipal court. The circuit court affirmed the municipal court’s denial of the motion to suppress and affirmed the conviction. Appellant sought another limited appeal to the court of appeals. The Attorney General asked the court of appeals to dismiss the case for lack of jurisdiction. The court of appeals certified the case to this court. We dismiss the appeal. We address neither the merits of the case, nor the propriety of the limited appeal in circuit court.

Rule 9 of the Inferior Court Rules governs appeals from municipal court to circuit court. Subsection (a) of the rule provides that the appeal of a civil case from municipal court to circuit court must be filed in the circuit clerk’s office within thirty days from the date of entry of the judgment. Subsection (b) provides that an appeal is taken by filing a record of the proceedings in municipal court. In this case, the necessary record would have included the information, the motion, and the judgment of the municipal court. See Inferior Ct. R. 9, Reporter’s Note 2.

Appellant admits that Rule 9 governs appeals of civil cases to circuit court, but denies that it applies to criminal cases. We have previously held that the rule applies to criminal cases, see, e.g., Ottens v. State, CR 93-765 (Ark. February 14, 1994); Bocksnick v. City of London, 308 Ark. 599, 825 S.W.2d 267 (1992), and we have said that the thirty days begins to run from the date the judgment is entered in the municipal court docket. See West Apartments, Inc. v. Booth, 297 Ark. 247, 760 S.W.2d 861 (1988). We have also ruled that the thirty-day requirement for filing the reco.rd is mandatory and jurisdictional. Bocksnick; Edwards v. City of Conway, 300 Ark. 135, 777 S.W.2d 583 (1989). Since appellant failed to timely file the municipal court record in circuit court, the municipal court judgment became final, and the circuit court never gained jurisdiction of the appeal.

Appellant contends that he substantially complied with Rule 9 when he filed a motion in circuit court asking to proceed as a pauper. We need not address the question of whether substantial compliance would suffice because the abstract does not reflect that any part of the record was tendered to the circuit clerk while the motion was pending, and it does not reflect that the motion to proceed as a pauper contained any part of the record. As reflected in the abstract, it contained only statements of the appellant. Thus, there was no compliance with the rule.

Appellant next contends that under Rule 36.22 of the Rules of Criminal Procedure, the time for appeal was stayed until the motion to proceed as a pauper was ruled on by the circuit court. Rule 36.22 stays time for appeal while specified posttrial motions are pending in the trial court. The motion to proceed as a pauper in circuit court was not one of the specified posttrial motions, and it was not pending in the trial court. The trial court in this case was the municipal court, so a motion filed in circuit court cannot possibly come within the rule. We need not decide whether the rule is applicable to municipal courts. Finally, overriding each of appellant’s enlargement of time arguments are our holdings that a circuit court has no authority to accept an untimely appeal, and a circuit court has no authority to grant a belated appeal. Edwards v. City of Conway, 300 Ark. 135, 777 S.W.2d 583 (1989).

Appeal dismissed.


author: Steele Hays, Justice.

text:
    Randall Thomas McARTY v. STATE of Arkansas
    CR 93-1071
    871 S.W.2d 346
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994

      McArthur & Finkelstein, by: William C. McArthur, for appellant.

      Winston Bryant, Att’y Gen., by: Kent G. Holt, Asst. Att’y Gen., for appellee.
   Steele Hays, Justice.

Appellant Randall Thomas McArty was charged with the first degree murder of Teresa Chamberlain. McArty was tried, convicted and sentenced to life imprisonment in the Arkansas Department of Correction. Two points for reversal are argued: it was error to allow the state to question a medical expert on matters beyond his experience and the evidence of guilt was not sufficient to support the verdict. As we cannot sustain the arguments, we affirm the judgment entered pursuant to the verdict.

The facts, related from the state’s position, are these: At about 10:30 p.m., July 31, 1992, officers of the Clark County Sheriff’s Department responded to an emergency at the Gurdon home which Randy McArty shared with Teresa Chamberlain. McArty had gone to a neighbor and the sheriff was called. When an officer asked McArty what the problem was, he answered, “I shot her. I shot her.”

Inside they found the body of Teresa Chamberlain on the kitchen floor with a gaping wound in the left chest. She was lying just inside a door leading to the carport. A butcher k;nife was in her right hand. Buckshot pellets were embedded in the wall opposite the door. In the carport was a vehicle with the lights on. A .12 gauge shotgun and a box containing one shell were in the car. One expended shell was in the gun and one was in McArty’s pocket.

Daniel Blasingame testified that he had been staying at the McArty residence for several days working on Teresa Chamberlain’s car. On the afternoon of July 31 he and Teresa had gotten beer and tequila and had been driving around, using Randy’s car. They had stopped at Lennie Richard’s house when Randy arrived. There was an argument and Randy left. Blasingame and Mrs. Chamberlain came home later and Blasingame went to bed in a back room. Teresa went to bed in the bedroom and her ten-year-old daughter, Amy, slept on a couch. Blasingame awoke to hear Teresa call for help. He heard a shot. When he came into the kitchen Teresa was lying on the floor and Randy was in the doorway holding the shotgun. Randy said, “I’m going to call an ambulance” and went next door.

The state’s witnesses included Marcus Bragg, an acquaintance of Randy McArty from school days, who testified that he met McArty by chance on July 31, 1992. In their conversation McArty told him he wanted to kill this woman, but later said he wouldn’t bother her. The next day Bragg heard she had been killed.

James Dillard testified that on the late afternoon of July 31, 1992, Randy McArty came into his store and bought five shotgun shells, No. 1 buckshot.

Tommy McMillan, a neighbor, testified that Randy came to his house that night, hollering that he had shot his girlfriend, that she had a big knife and was going to stab him. He heard Amy say her mother was after Randy with a knife and Randy shot her.

Randy McArty testified that he met Teresa in January of that year and she moved in with him four or five weeks later. He described episodes of physical violence between them including a time when Teresa had scalded him with the contents of a crock-pot.

When he found Teresa and Dan at Lennie Richard’s house he asked Teresa for the keys to his car and had to take them from her. As he was preparing to leave, Teresa cursed him and tried to strike him through the window. When he got home about 10:00 p.m. the house was dark. He switched on the light in the kitchen and Teresa was standing there. The argument resumed and Teresa tried to get at him with the knife. He raised the gun as she turned and it went off. She called to Dan to help her and Randy left to call an ambulance.

There was other proof from which varying inferences could be drawn. The state offered evidence suggesting that the knife was placed in Teresa’s hand afterwards and that the shot was fired as Teresa was opening the kitchen door. Blasingame testified he saw no knife. These were issues for the jury.

The state called physician William Quinton Sturner, chief medical examiner of Arkansas, who performed the autopsy. The pellets entered her upper left chest at an angle, penetrated the aorta, and emerged behind the upper right arm and back. Dr. Sturner was asked about the trajectory of the pellets after leaving the body. Defense counsel objected on the grounds that Dr. Sturner was not an arms expert and was not qualified to say what would happen to the pellets after leaving the body. The objection was overruled and Dr. Sturner stated that the pellets “went out separated.”

Citing Wilburn v. State 289 Ark. 224, 711 S.W.2d 760 (1986), McArty argues on appeal that the test for expert testimony is whether the witness has knowledge of the subject at hand which is beyond that of ordinary people. Appellant concedes that in Farrell v. State, 305 Ark. 54, 810 S.W.2d 29 (2991), we found no abuse of discretion by the trial court in allowing a nonexpert to testify concerning a firearm, but, he argues, in contrast to this case, the witness in Farrell had extensive experience with firearms.

First, we regard the issue as largely abstract, as appellant has not shown us how the pattern of the emerging pellets had any substantial impact on the trial. A.R.E. 103(d). Second, we think common experience would suggest the likelihood of some dispersion of shotgun pellets, even buckshot, entering the body at a slight angle near the upper chest and emerging behind the upper arm. The sternum and shoulder blade, even the soft tissues and cartilage, could hardly be expected to have no effect on the trajectory of shotgun pellets. Third, issues of this kind fall clearly within the discretion of the trial court and no abuse of that discretion is evident here. White v. State, 303 Ark. 30, 792 S.W.2d 867 (1990).

Turning to the sufficiency of the evidence, we need refer to only three segments of the proof: The testimony of Marcus Bragg that McArty spoke of killing the woman he was living with; the testimony of James Dillard that McArty purchased five shotgun shells around five o’clock that afternoon; and the fact that McArty had the loaded shotgun at his side when he entered the house. Obviously it cannot be said that evidence of intent was so lacking that a directed verdict was called for. Taylor v. State, 303 Ark. 587, 799 S.W.2d 519 (1990).

The record has been examined in accordance with Ark. Sup. Ct. R. 4-3(h), and the objections have all been abstracted and certified by the state. There are no other rulings adverse to the appellant which constituted prejudicial error.

For the reasons stated, the arguments presented on appeal are denied and the judgment of conviction is affirmed.

Holt, C.J., not participating.


text:
    Jesse TAGGART v. NORTHEAST ARKANSAS REHABILITATION HOSPITAL
    93-703
    870 S.W.2d 717
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994

      Larry J. Steele, for appellant.

      W. Ray Nickle, for appellee.
   Steele Hays, Justice.

Northeast Arkansas Rehabilitation Hospital (appellee) brought this action in the circuit court to recover for rehabilitation services rendered to Jesse Taggart (appellant). Since the interpretation or construction of an act of the General Assembly is in question, our jurisdiction attaches under Ark. Sup. Ct. R. 29(l)(c). The question we are asked to decide is whether a medical provider whose charges are disallowed by the Arkansas Workers’ Compensation Commission as unreasonable or unnecessary may recover from the employee. The answer is yes.

Appellant Jesse Taggart sustained an injury to his right hand at the plant of Frolic Footwear, his employer. Taggart developed reflex sympathectomy dystrophy — a conversion disorder. He was referred by a treating physician to the Northeast Arkansas Rehabilitation Hospital, appellee, and came under the care of Dr. Russell Dixon. Frolic Footwear’s carrier paid $5,649.30 toward the rehabilitation charges but refused to pay the additional $12,030.20. The Administrative Law Judge disallowed that amount as unreasonable and unnecessary. That ruling was affirmed by the Commission and by the Arkansas Court of Appeals.

The hospital filed suit against Taggart to recover the balance of its charges. Taggart moved to dismiss on the contention that the referral to the hospital was recommended by physicians selected by the employer and the hospital had continued to treat him notwithstanding the employer’s objection. The trial court held that Taggart was indebted for the services and Taggart appeals on the single point that the trial court erred in denying his motion to dismiss the complaint. We affirm the judgment appealed from.

Taggart’s argument on appeal is two-fold: 1) Dr. Dixon knew the claim was controverted but continued treatments; and, 2) Taggart was the beneficiary of an implied contract between the hospital and the employer to pay for the treatment.

We equate the first contention with estoppel, though it is not labeled as such. We recently discussed the elements of estoppel in Hope Education Association v. Hope School District, 310 Ark. 768, 839 S.W.2d 526 (1992): 1) The party to be estopped must know the facts; 2) he or she must intend that his or her conduct shall be acted upon or must act so that the party asserting the estoppel has a right to believe the other party so intended; 3) the party asserting the estoppel must be ignorant of the true facts; and 4) the party asserting the estoppel must rely on the other party’s conduct to his or her injury.

Of the scant evidence presented to the trial court, it might be said there was some basis for elements one and four, but none whatever for the other two. A waiver argument would meet the same result. See Ingram v. Wirt, 314 Ark. 553, 864 S.W.2d 237 (1993).

Turning to the other contention, we agree that a contract may arise by implication from the conduct of the parties [see Steed v. Busby, 268 Ark. 1, 593 S.W.2d 34 (1980)]; however, to be enforceable it must be definite and certain in its terms. Welch v. Cooper, 11 Ark. App. 263 (1984). Here, there is nothing to show that an agreement clearly arose. The only proof touching on who was responsible for payment came from the hospital, which introduced a Patient Consent Form executed at the time of Taggart’s admission. The provisions includes the following:

GUARANTEE OF ACCOUNT:
In consideration of services rendered or to be rendered by Northeast Arkansas Rehabilitation Hospital, I agree to pay the Hospital the regular charges for all services ordered by the attending physician, patient or patient’s family or otherwise rendered or to be rendered to the patient. Should the charges, or any part thereof, be referred to an attorney for collection, the undersigned shall pay reasonable attorney’s fees and collections expense.

The form purports to bear the signature of Jesse Taggart. Taggart denied actually signing the form, adverting to his injured right hand, but acknowledged that the handwriting resembled that of his wife. He did not disclaim knowledge of the provision nor in any wise challenge her authority to sign in his stead.

We think this case is controlled by the case of Savage v. General Industrials, 23 Ark. App. 188, 745 S.W.2d 644 (1988). The claimant, Ms. Savage, appealed from an order of the commission refusing to declare that she was not personally responsible for payment of medical expenses found to be unreasonable or unnecessary under provisions of the Workers’ Compensation Act then appearing in Ark. Stat. Ann. § 81-1311 (Supp. 1985) and now codified as §§ 11-9-508 and 11-9-513 (1987). Pertinent portions of those provisions read:

§ 11-9-508.
(a) The employer shall promptly provide for an injured employee such medical, surgical, hospital, and nursing service, and medicine, crutches, artificial limbs, and other apparatus as may be reasonably necessary for the treatment of the injury received by the employee. [Our emphasis.]
§ 11-9-513.
All persons who render services or provide things mentioned in §§ 11-9-508 - 11-9-516 shall submit the reasonableness of the charges to the commission for its approval, and, when so approved, the charges shall be enforceable by the commission in the same manner as is provided for the enforcement of compensation payments. However, the provisions of this section relating to charges shall not apply where a written contract exists between the employer and the person who renders the service or furnishes the things. [Our emphasis.]

Ms. Savage’s employer had approved $1,010 of her physician’s total charge of $1,955, alleging the balance was unreasonable. Addressing that dispute, the Administrative Law Judge found $1,110 reasonable and necessary, but did not decide whether she was personally responsible for the balance. The Commission also held that it lacked that authority, notwithstanding its empowerment under Hulvey v. Kellwood, 262 Ark. 564, 559 S.W.2d 153 (1977), to determine the reasonableness of medical charges.

On appeal Ms. Savage urged the Court of Appeals to hold that a worker who sustains a compensable injury is not personally liable for payment of medical expenses found to be unreasonable or unnecessary. The Court of Appeals carefully examined that issue and supportive authority. It noted that the collection from the employee of unreasonable medical fees is prohibited under some statutory schemes, but that other courts, interpreting statutes similar to ours, hold that the Commission has no power to disallow unreasonable or unnecessary charges. See, e.g. Intermountain Health Care, Inc. v. Industrial Commission, 657 P.2d 1289 (Utah 1982). We believe that holding is consistent with the palpable intent of our statutes.

For the reasons stated, the judgment is affirmed.


author: David Newbern, Justice. Per Curiam.

text:
    Vicki NANCE v. ARKANSAS DEPARTMENT OF HUMAN SERVICES
    93-736
    870 S.W.2d 721
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994
    [Supplemental Opinion on Denial of Rehearing April 18, 1994]

      Kent L. Tharel, for appellant.

      Kay West Forrest, for appellee.

      Mark Lindsay, P.A., for David Nance.

      Aleñe Cox, Guardian Ad Litem for Mary Lila Nance.
   David Newbern, Justice.

Vicki Nance appeals an order of the Juvenile Court placing custody of her daughter with her former husband, Roy David Nance. The order is the result of juvenile court hearings which were extensive in number and duration. Ms. Nance has presented five points of appeal, the last of which contains several subpoints. The main question is whether a juvenile division of a chancery court, having found a child to be dependent or neglected, has the authority to make an award of custody of the child between competing parents. We find no error and affirm.

Vicki and Roy Nance were married in Texas in 1978. As a result of their divorce in 1982, Ms. Nance was awarded custody of their two children. Ms. Nance subsequently relocated to Fayetteville in 1986 with these children and a younger daughter.

While visiting her father in Texas during the summer of 1992, the oldest daughter, Mary Lila, then fourteen, allegedly stated she did not want to return to her mother. Mr. Nance failed to return her, and a custody battle ensued. Ms. Nance sought a contempt citation in Washington County Chancery Court. Mr. Nance moved to modify the custody award in a district court in Montgomery County, Texas. Each court dismissed for lack of jurisdiction. The Texas court ultimately ordered Mary Lila returned to her mother pursuant to Ms. Nance’s petition for a Writ of Habeas Corpus.

Mary Lila’s mother subsequently enrolled her in a boarding school near Chicago for the 1992-93 school year. Very shortly after her arrival, Mary Lila began to exhibit psychological problems, and became incoherent. Ms. Nance removed her from the school, and they returned to Fayetteville.

On August 27, 1992, Ms. Nance was attempting to take Mary Lila to a doctor in Oklahoma and was involved in a serious car accident. Both Ms. Nance and Mary Lila were taken to Springdale Memorial Hospital. At the hospital, Mary Lila was catatonic, and at times hallucinated, thinking that a serpent was in her throat. A psychological evaluation was ordered. Ms. Nance demanded that her daughter be evaluated by a Christian psychiatrist. The hospital and Ms. Nance were unable to agree on a suitable doctor to perform the evaluation. By September 1, 1992, Mary Lila had still not had a psychological examination.

Ms. Nance allegedly attempted to remove her daughter from the hospital contrary to medical advice. As a result, the Washington County Department of Children and Family Services supervisor placed a 72-hour protective hold on Mary Lila and ordered a psychological examination.

The doctor performing the examination concluded that Mary Lila was suffering “acute adjustment disorder with psychotic thinking,” and recommended in-patient psychiatric treatment as soon as possible. Brookhaven in Tulsa was recommended based on Ms. Nance’s request for a Christian-affiliated facility. Brookhaven refused to admit Mary Lila because of lack of medicaid or insurance .to pay for treatment. When Ms. Nance was unable to find another religiously affiliated psychiatric facility, Harborview in Fort Smith was suggested.

At this point doctors evaluating Mary Lila believed Ms. Nance was not willing to take Mary Lila to Harborview. They also believed Ms. Nance might remove her daughter from the facility before her treatment was completed.

As a result of these circumstances, the Department of Human Services (DHS) petitioned for emergency custody of Mary Lila, stating probable cause existed that she was dependent-neglected as defined by the Juvenile Code. The Washington County Juvenile Court granted custody of Mary Lila to DHS and notified Mr. and Ms. Nance of their right to counsel. Mary Lila was placed in the Harborview facility for psychiatric treatment.

Subsequent to the emergency order, Mr. Nance petitioned to modify the custody aspect of his divorce decree in Washington County Chancery Court. On September 28, 1992, he moved to transfer the petition and consolidate it with the DHS case in juvenile court. The Juvenile Court declined to order the transfer.

Several hearings were held in Juvenile Court as the result of the emergency order. At the first hearing, the Juvenile Court concluded that probable cause existed that Mary Lila was in need of medical care that her family could not provide and ordered Mary Lila’s continued custody with DHS.

During the next two hearings, the Juvenile Court heard testimony concerning Mary Lila and Ms. Nance’s household. Additionally, the Court held an in camera discussion with Mary Lila in which she indicated her desire to move to her father’s home after being discharged from Harborview. Although the Court concluded that both Mr. and Ms. Nance were fit to raise Mary Lila, he ordered that she be placed temporarily with her father upon her release from Harborview.

Subsequent hearings were held to monitor Mary Lila’s progress and address visitation and child support issues presented by the parties. On June 30, 1993, the Juvenile Court ruled that it was in Mary Lila’s best interest to be placed with her father, and dismissed the proceedings.

Ms. Nance appeals from that order.

1. Jurisdiction

Ms. Nance contends the Juvenile Court lacked jurisdiction to enter an order changing custody to Mr. Nance. Ms. Nance argues that custody may only be established pursuant to a divorce, and as Mr. Nance’s petition to modify the custody order from his divorce was not transferred to the Juvenile Court, the Court lacked jurisdiction to enter an order of custody. Ms. Nance cites several cases following our ruling which originated in Robins v. Arkansas Social Services, 273 Ark. 241, 617 S.W.2d 857 (1981), to the effect that there can be no separate action for custody which must be established pursuant to divorce.

The Robins case, as well as the other cases cited, were decided before the enactment of the Arkansas Juvenile Code of 1989, Ark. Code Ann. § § 9-27-301 through 9-27-352. Section 9-27-305 states any juvenile within the State may be subjected to the jurisdiction of a juvenile court. Section 9-27-306(1) grants juvenile courts exclusive original jurisdiction of proceedings in which a juvenile is alleged to be dependent-neglected.

Section 9-27-334(a)(2) allows a juvenile court, pursuant to a finding that a juvenile is dependent-neglected, to transfer custody to DHS, another licensed agency, “or to a relative or other individual.” From the language in § 9-27-334 it is clear that the Juvenile Court had the power to award custody of Mary Lila to Mr. Nance once DHS initiated dependency-neglect proceedings. While it does not apply to this case, we note that in 1993 the General Assembly made it clear that a juvenile court’s custody order supersedes any existing court order and remains in effect until a subsequent custody order is entered by a court of competent jurisdiction. See §9-27-334(b).

Ms. Nance cites § 9-27-338(a), which lists disposition alternatives a juvenile court may consider in its 18-month review of dependency-neglect cases, pointing out that transfer of custody is not included. As the Juvenile Court’s order in this case was not one made pursuant an 18-month review, we reject the argument, especially in view of the language of § 9-27-334(a)(2) and the General Assembly’s subsequent expression of juvenile court priority in §9-27-334(b).

2. Dependency-neglect holding

The Juvenile Code requires proof by a preponderance of the evidence in dependent-neglected proceedings. Ark. Code Ann. § 9-27-325(h)(2) (Repl. 1993). We review a Chancellor’s findings of fact de novo, and will not set them aside unless they are clearly erroneous. Ark. R. Civ. R 52(a). Ms. Nance argues the Juvenile Court’s holding in this respect was clearly against the preponderance of the evidence.

A dependent-neglected juvenile is one who “as a result of abandonment, abuse, sexual abuse, sexual exploitation, neglect, or parental unfitness is at substantial risk of serious harm.” § 9-27-303(12). The Juvenile Code further defines “neglect” as an act or omission by a parent which constitutes failure or refusal to provide “medical treatment necessary for a juvenile’s well being, except when the failure or refusal is caused primarily by the financial inability of the person legally responsible and no services for relief have been offered or rejected.” § 9-27-303(23)(B).

The record reflects a dispute between Ms. Nance and Mary Lila’s doctors about a proper psychological examiner and that, but for DHS intervention, treatment could have been delayed even more than it was. The record also indicates that some of the doctors and social workers involved in this case were concerned Ms. Nance would not allow Mary Lila to remain at a psychiatric facility for the duration of her treatment. Under these circumstances we have little difficulty concluding the evidence of “neglect” was sufficient, even though it may have stemmed from parental motives which could not be characterized as neglectful in the sense of being intended to harm the child or not to care for her.

3. Former attorney’s testimony

During July and August of 1992, Kelly Proctor represented Ms. Nance in her attempt to enforce the order granting custody of Mary Lila to her. Ms. Proctor was also Ms. Nance’s house guest at that time.

The guardian ad litem for Mary Lila Nance subpoenaed Ms. Proctor to testify at an October, 1992, hearing. The testimony, which was unfavorable to Ms. Nance, concerned Ms. Nance’s treatment of her children, and the conditions in the home, while Ms. Proctor was a guest there.

Ms. Nance’s attorney at the hearing objected to the testimony and refused to waive the attorney-client privilege. The attorney argued that Ms. Proctor’s testimony had to do with furtherance of Ms. Proctor’s representation of Ms. Nance and was confidential. The Trial Court overruled the objection, limiting Ms. Proctor’s testimony to her observations of conditions in Ms. Nance’s home. Ms. Nance argues the testimony is barred by the Model Rules of Professional Conduct and Ark. R. Evid. 502.

Model Rule 1.6 concerns a lawyer’s duty not to reveal “information relating to representation of a client unless the client consents after consultation.” According to the scope note accompanying them, the Model Rules of Professional Conduct were designed to regulate the practice of law, and to provide a mechanism for disciplining attorneys and not to form the basis of substantive law decisions. Nevertheless, we cite the Model Rules from time to time as having an effect on the outcome of litigation. For example, we cited Model Rule 1.6 in Burnette v. Morgan, 303 Ark. 150, 794 S.W.2d 145 (1990), in the process of deciding whether we should reverse a trial court decision on the ground that a participating attorney should have been disqualified.

We have some doubt whether Ms. Proctor’s testimony about the conditions in Ms. Nance’s home qualifies as information “relating to representation” of Ms. Nance. We need not dwell on Model Rule 1.6, however, as the matter of attorney-client privilege is clearly regulated by Ark. R. Evid. 502(b).

Rule 502(b) concerns the admissibility of information disclosed to an attorney by her client. It allows a client to prevent the disclosure of any confidential communications “made for the purpose of facilitating the rendition of professional legal services to the client.” There is no evidence before us suggesting that Ms. Nance revealed or “communicated confidentially” anything about the conditions in her home to which Ms. Proctor testified.

4. Absence of attorney

On April 19, 1993, a hearing was held for the limited purposes of considering requests to modify visitation rights and child support. The hearing was scheduled for a date when Mary Lila would be present in Fayetteville to testify.

Ms. Nance’s attorney failed to appear at the hearing. Ms. Nance informed the Trial Court her attorney believed the hearing had been continued to a later date. The Juvenile Court unsuccessfully attempted to contact the attorney. Attorneys for the other parties objected to a continuance due to the prospective difficulty of rescheduling Mary Lila’s presence.

The Juvenile Court commenced the hearing, and allowed Ms. Nance to represent herself. Mary Lila testified that her mother had acted in a very hostile and threatening manner during their last visit. After cross examining Mary Lila, Ms. Nance became frustrated and stated she was willing to place her daughter in Mr. Nance’s custody. Ms. Nance stated that she was tired of the proceedings and had no money to continue further. The Court stated Ms. Nance would not be held to those remarks until she had talked to her attorney.

Ms. Nance argues her right to due process of law was violated. Section 9-27-302(4) states the Juvenile Code is designed to protect a party’s due process rights, and § 9-27-314(b) provides that a parent has a right to an attorney. We fail to see how Ms. Nance’s rights were violated. She was notified of her right to counsel, and indeed had obtained counsel to represent her. Ms. Nance did not object to the hearing commencing, and neither did the attorney representing her at the subsequent hearing. She was clearly not denied the right to counsel, and the Court attempted to protect her interests.

5. Other statutory requirements

Ms. Nance finally contends the Court erred by failing to require DHS to comply with the requirements of the juvenile code. She argues that the Juvenile Court failed to require a case plan aimed at reunification of Mary. Lila with her mother in accordance with § 9-27-303(6)(G). We agree that an important goal of the statutory juvenile justice system is reunification of the juvenile with the parent, custodian, or guardian from whom the juvenile has been separated. § 9-27-303(17). We do not, however, conclude that reunification must be achieved if it proves to be against the best interests of the juvenile.

In response to this argument, DHS and the guardian ad litem of Mary Lila point out a number of actions taken which could be seen as efforts to effect reconciliation and thus reunification of Mary Lila with Ms. Nance. They include DHS’s payment for long-distance phone calls and air travel for Mary Lila from Texas to Fayetteville and back for visitation in addition to some DHS home services.

Ms. Nance argues that the home study requirements found in §9-27-303(19) were not met. Two home studies were done on Mr. Nance’s home. The first was an informal one conducted by DHS, and the second was by Texas Child Protective Services, resulting in a written report which appears in the record. No home study was done on Ms. Nance’s home because she and her lawyer declined after being informed it was available at Ms. Nance’s option. There was, as noted above, however, considerable testimony about conditions in Ms. Nance’s home.

873 S.W.2d 812

Finally, Ms. Nance argues that there was no compliance with the mandatory provisions of the Interstate Compact on the Placement of Children found at Ark. Code Ann. § 9-29-201 (Repl. 1993). Subsection (a) of Article III of the compact makes it clear that it is meant to deal with children who are sent from a sending state into a receiving state “for placement in foster care or as a preliminary to a possible adoption.” That is not the case here.

Affirmed.

Glaze, J., concurs.

SUPPLEMENTAL OPINION ON DENIAL OF REHEARING APRIL 18, 1994

Kent L. Tharel, for appellant.

No response.

Per Curiam.

We deny Ms. Nance’s petition for rehearing, but we do agree that a clarification is needed of our earlier opinion as it discussed Ark. Code Ann. § 9-27-338 (Repl. 1993).

In her petition, Ms. Nance contends, contrary to this court’s decision, that Ark. Code Ann. § 9-27-338(a) (Repl. 1993) applies to this case. Under that provision, Nance points out that the juvenile court’s disposition in this case was limited to one of the following: (1) return Mary Lila to Ms. Nance; (2) authorize a plan to terminate Mary Lila’s relationship with Ms. Nance; (3) place Mary Lila in long-term foster care; or (4) allow Mary Lila to continue in an out-of-home placement for a specified, limited period of time. Out-of-home placement is defined in Ark. Code Ann. § 9-27-303(26) (Repl. 1993) as follows:

(A) Placement in a home or facility other than the home of the parent or guardian from whose custody the court has removed the juvenile; or
(B) Placement in the home of a relative; provided, however, this definition shall not include circumstances where the court has discontinued orders for delivery of family services pursuant to a determination that the home of the relative shall be the permanent home of the juvenile.

The Juvenile Code further provides that, if the court finds that the juvenile should remain in an out-of-home placement, either long-term or otherwise, the juvenile’s case shall be reviewed every six months. Ark. Code Ann. § 9-27-338(b) (Repl. 1993).

Ms. Nance’s contention is correct that, once the juvenile court took jurisdiction of this matter as a dependent-neglect case, the Juvenile Code provisions became applicable. That being so, the juvenile court was obliged to provide for periodic reviews under Ark. Code Ann. § § 9-27-337 and 9-27-338 (Repl. 1993).

The record reflects the juvenile court did conduct hearings, but when it concluded its final hearing it merely found Mary Lila needed stability and her best interests would be served by transferring (continuing) custody with her father. The court further found that DHS no longer had to provide services. The juvenile court then erred when it dismissed the proceedings even though it further determined Ms. Nance has been in substantial compliance with the case plan developed by DHS.

Under the Juvenile Code, a juvenile court must follow the procedures and dispositions set out under § 9-27-318, although other permissible dispositions are available under Ark. Code Ann. § 9-27-335 (Repl. 1993) in situations where the court finds reasonable efforts to deliver family services have not been made —the juvenile court here made no such finding. See also Ark. Code Ann. § 9-27-335 (Repl. 1993). Nowhere in the Code can we find authority for a juvenile court to dismiss dependent-neglect proceedings when the parties all comply with the case plan and reasonable efforts are being made by all concerned. Certainly, reunification, the cornerstone of the Juvenile Code, could never be achieved in these circumstances by dismissing the proceedings.

In sum, while we agree that at the time of the hearing, the record tended to support the juvenile court’s continuing the custody of Mary Lila with her father, the court was entirely wrong in dismissing this dependent-neglect case under the circumstances presented. If such dismissal is permitted here, then the review procedures and services provided by law to protect children and families become applicable and enforceable only when a juvenile court, in its own discretion, wishes to invoke those Code provisions. Therefore, we remand this matter to the juvenile court with directions to reinstate this case for periodic reviews required by Arkansas’s Juvenile Code provisions.

      Section 9-27-338(a) states in full as follows:
      (a) Eighteen (18) months after the date the juvenile enters an out-of-home placement, or earlier if ordered by the court, the court shall hold a hearing in order to enter a new disposition in the case. At the hearing, based upon the facts of the case, the court shall enter one (1) of the following dispositions:
      (1) Return the juvenile to the parent, guardian, or custodian;
      (2) Authorize a plan for the termination of the parent-child relationship, guardianship, or custody;
      (3) Place the juvenile in long-term foster care; or
      (4) Allow the juvenile to continue in out-of-home placement for a specified period of time.

      We note here that this case is not one where the juvenile court authorized a plan to “terminate” Ms. Nance’s parental relationship with or custody of Mary Lila. In fact, the court merely concluded that the return of custody of Mary Lila to Ms. Nance was contrary to Mary Lila’s welfare “at this time."

      In fact, the court’s final order found DHS made reasonable efforts to provide services to the juvenile and family. We note also that § 9-27-335 does allow for dismissal of dependent-neglect proceedings if DHS fails to provide family services. Presumably in such an instance, the custody of the child is returned to the custodial parent.

      At this point, wc would reiterate a point previously mentioned in our decision that the General Assembly has made it clear that a juvenile court’s custody order supersedes any existing court order and remains in effect until a subsequent custody order is entered by a court of competent jurisdiction. Ark. Code Ann. § 9-27-334(b) (Repl. 1993).


text:
    Christi Lynn STURCH v. James Paul STURCH
    93-574
    870 S.W.2d 720
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994
    Gregory E. Bryant, for appellant.

    Dana Sue West, for appellee.

   David Newbern, Justice.

Christi Sturch appeals a divorce decree from Pulaski County Chancery Court. We affirm the Chancellor’s decision pursuant to Ark. Rule Sup. Ct. 4-2(b)(2) due to the appellant’s flagrantly deficient abstract.

Arkansas Supreme Court Rule 4-2(a)(6) requires an abstract to consist of material parts of the pleadings, proceedings, facts, documents, and other matters necessary to an understanding of the question presented to the court. In this appeal the appellant’s abstract consists solely of a one-half page portion of the Chancellor’s divorce decree. From this abstract it is impossible to locate any factors that led to the Chancellor’s ruling which resulted in this appeal. For this reason it is impossible to address adequately the point on appeal, and we will not attempt to do so.

Affirmed.


author: Tom Glaze, Justice.

text:
    ERNEST F. LOEWER, JR. FARMS, INC. v. NATIONAL BANK OF ARKANSAS
    93-808
    870 S.W.2d 726
    Supreme Court of Arkansas
    Opinion delivered February 21, 1994
    [Rehearing denied March 28, 1994.]

      Crockett, Brown, & Worsham, P.A., by: Richard E. Worsham, Cheryl Fisher Anderson and Robert J. Brown, for appellant.

      Davidson Law Firm, Ftd., by: Charles Darwin Davidson and Melanie C. Weaver, for appellee.

      HoIt, C.J., not participating.

   Tom Glaze, Justice.

On July 31, 1983, Continental Capital Corporation (CCC) executed a promissory note to National Bank of Arkansas (NBA) in the amount of $150,000. On the same day the appellant, Ernest F. Loewer, Jr. Farms, Inc. (Loewer), executed an Assignment of Savings Account/Certificate of Deposit #50727 to NBA, assigning $100,000.00 of Loewer’s $106,179.73 CD to NBA as collateral for the CCC note. A Separate Collateral Agreement pledging the CD was also executed by Loewer on July 31, 1983. The CD matured on October 29, 1983, and renewal CDs were issued in Loewer’s name. Loewer received periodic interest payments from these CDs.

On June 9, 1987, CCC defaulted on its note to NBA, and an officer of NBA endorsed Loewer’s renewal CD #1753 which was payable in the amount of $102,056.85. NBA then issued a cashier’s check for that amount payable to Loewer, endorsed the check and applied $100,000.00 of the proceeds to the CCC debt.

On January 7, 1992, about four and one-half years after CCC’s default and NBA’s application of Loewer’s CD proceeds to CCC’s debt, Loewer filed suit against NBA, seeking recovery of the $102,056.85, interest and attorney’s fees. NBA answered, asserting the affirmative defense of the statute of limitations. On January 8, 1993, NBA filed a motion for summary judgment, alleging Loewer’s tort or conversion claim was barred by the three-year statute of limitations set forth in Ark. Code Ann. 16-56-105 (1987).

On January 15, 1993, Loewer filed its first amended complaint, wherein it set forth additional allegations, stating (1) Loewer had pledged its CD for “clearing house purposes” only, (2) it never assigned additional collateral after its original CD had matured, (3) NBA and CCC’s president had fraudulently concealed from Loewer that they had entered into a settlement agreement, (4) NBA’s officer unilaterally made an unauthorized endorsement of Loewer’s CD and cashier’s check and (5) Loewer was entitled to the CD proceeds. In addition, Loewer requested attorney’s fees under Ark. Code Ann. § 16-22-308 (Supp. 1993) for having to bring suit against NBA for its breach of the terms of Loewer’s CD. On March 3, 1993, the trial court entered an opinion and judgment granting NBA’s summary judgment, finding Loewer’s claim was based on conversion rather than written contract and therefore barred by the statute of limitations, § 16-56-105.

On March 12, 1993, Loewer filed a second amended complaint re-alleging the facts in its first amended complaint, but adding that NBA had created a forged assignment of Loewer’s original CD as well as a forged collateral agreement. Loewer also specifically alleged it was seeking recovery on a written contract based on NBA’s breach of the written terms on renewal CD #1753 and was waiving any tort claims it might have. In doing so, Loewer sought to have its action come within the five-year statute of limitations applicable to written contracts under Ark. Code Ann. § 16-56-111(b) (Supp. 1993).

On April 2, 1993, Loewer filed a motion for reconsideration, and the trial court entered an order which temporarily set aside its March 3 opinion and judgment. Following a hearing on Loewer’s motion, the trial court entered an order on April 8, 1993, which reinstated its March 3, 1992 opinion and judgment. Loewer appeals from that reinstatement order which dismissed Loewer’s suit against NBA.

Loewer’s primary argument for reversal is that the gist of its cause of action against NBA is in contract and is based upon NBA’s breach of failing to pay Loewer the proceeds due it under the terms set forth in its renewal CD #1753. Loewer claims that the original CD #50727 it-had assigned to NBA for clearing house purposes as collateral for CCC’s loan matured on October 29, 1983, and that the successive renewal CDs, including CD #1753, were unconditionally payable to Loewer per the contract terms on those written CDs. Loewer also asserts its action against NBA is one in contract because in its second amended complaint, Loewer specifically waived any tort claim it had.

The trial court below rejected Loewer’s arguments, and in doing so relied in part on our holding in O’Bryant v. Horn, 297 Ark. 617, 764 S.W.2d 445 (1989). In O’Bryant, the lower court dismissed O’Bryant’s complaint because the complaint stated a tort cause of action for fraud or deceit and therefore was barred by the three-year statute of limitations, § 16-56-105. Like Loewer now argues in our present case, O’Bryant contended that his action was based on a written contract (a bill of sale) and that the lower court should have found O’Bryant’s suit was filed timely under the five-year statute of limitations for written instruments, § 16-56- 111(b). In support of his contention, O’Bryant alleged in his complaint that he purchased from Horn a used log skidder which was represented by Horn to be a 1978 model worth $18,000, when in fact it was a 1973 model with a market value of $10,000. Although O’Bryant claimed damages as a result of Horn’s misrepresentation, negligence and/or fraud, O’Bryant also asserted Horn breached their written contract (bill of sale) which was attached to the complaint. In rejecting O’Bryant’s argument, this court stated the settled rule that it looked to the gist of the action as alleged to determine which statute of limitations applies. See also Goldsby v. Fairley, 309 Ark. 380, 831 S.W.2d 142 (1992). This court concluded O’Bryant’s attachment of the bill of sale to the complaint was not enough to transform his action into one for breach of contract.

Here, Loewer concedes the renewal CD #1753 attached to its complaint is the basis of its contract action against NBA. Nonetheless, Loewer claims O’Bryant is not controlling here because, in addition to attaching its CD to the complaint, Loewer also had other allegations in the complaint making its action sound in contract. For example, Loewer mentions its second amended complaint and its specific allegations that (1) Loewer sought recovery on CD #1753, (2) that CD #1753 is a written contract, (3) Loewer waived any tort claims, and (4) it was entitled to recover not only the proceeds evidenced by CD #1753, but also attorney’s fees for breach of contract under § 16-22-308.

First, Loewer’s argument ignores the many other factual allegations contained in its complaint. Loewer alleged that it pledged its CD for the CCC loan, but in an alleged “side agreement” the collateral was only for clearinghouse purposes. Loewer included several paragraphs in its complaint setting out that NBA was involved in replacing and changing dates on CDs, and in forging an assignment and collateral agreement in connection with the CDs and the CCC loan. In addition, Loewer factually asserted NBA unilaterally and without authority endorsed both CD #1753 and the cashier’s check evidencing the proceeds of that CD. Clearly, these allegations considered together sound in tort, namely conversion.

In sum, Loewer’s argument emphasizes the written terms of its CD and NBA’s failure to pay it upon maturity, but at the same time, Loewer ignores the significance of the documents both parties used to collateralize CCC’s note. When NBA initially issued Loewer its CD, NBA did have an obligation to pay Loewer its proceeds under the terms on the CD. However, that obligation later became subject to an assignment and pledge, and as mentioned previously, Loewer now alleges events transpired to render those documents ineffective. The gist of those allegations clearly sounds in tort. Such allegations include words like forgery, unauthorized endorsement and misapplication of funds, which denote a wrongful dominion or control by NBA over proceeds purportedly belonging to Loewer. Certainly, these allegations are unnecessary when stating an action involving breach of contract. Accordingly, we agree with the trial court that the gist of the complaint sounds in tort, and because of this finding, Loewer’s suit is barred by the three-year statute bf limitations.

We should add that, even if we could accept Loewer’s contract contention, we point out that the statute of limitations, § 16-56-111(b) (1987), that Loewer relies on is statutorily made inapplicable under § 16-56-103(b) (1987). Under the express terms of § 16-56-103(b), § 16-56-111(b) does not apply to suits to enforce payment of any bills, notes, or evidences of any debt issued by any bank.

In conclusion, Loewer offers on appeal two alternative reasons for reversal if the court disagrees that the statute of limitations for written contracts is applicable. One, it suggests the six-year limitations after demand for payment under Ark. Code Ann. § 4-3-118(e) (Repl. 1991) should apply because Loewer’s action merely involves the enforcement of NBA’s obligation to pay Loewer the proceeds of its CD. Two, even if Loewer’s action is one for conversion, NBA should not escape liability by claiming it converted a depositor’s funds — that such a use of the three-year limitations is “shameful and unseemly.” Neither these points nor the applicability of Article 3 of the UCC were ruled on by the trial court and matters left unresolved below are waived and will not be considered on appeal. Morgan v. Neuse, 314 Ark. 4, 857 S.W.2d 826 (1993).

For the reasons above, we affirm the trial court’s decision.

Holt, C.J., not participating.

      Ernest Loewer, President of Loewer, and J. R. Hodges, President of CCC, had both social and business relationships and were involved in past loans, investments and collateralized loans.

      Loewer’s argument in this respect omits that NBA was assigned Loewer’s CD and as assignee, NBA only exercised the same rights Loewer had as assignor-depositor of the CD. The original CD #50727 provided for automatic renewals for the same term as the original. Nothing in the collateral documents provided the original CD or its renewals would cease being collateral to the CCC note.

      Conversion is the exercise of dominion over property in violation of the rights of the owner or person entitled to possession with the specific intent to dominate or control property claimed by another. City National Bank of Fort Smith v. Goodwin, 301 Ark. 182, 783 S.W.2d 335 (1990).

      Under Ark. Code Ann. § 4-3-104(j) (Repl. 1991), a CD is a negotiable instrument under the UCC, and an action to enforce such an instrument under Article 3 of the UCC would be subject to the six-year limitation period under the Code, Ark. Code Ann. § 4-3-118(e).