author: David Newbern, Justice.

text:
    Dan MATTHEWS v. STATE of Arkansas
    CR 92-1383
    854 S.W.2d 339
    Supreme Court of Arkansas
    Opinion delivered June 1, 1993

      Kinney & Snowden, by: William G. Snowden, for appellant.

      Winston Bryant, Att’y Gen., by: Brad Newman, Asst. Att’y Gen., for appellee.
   David Newbern, Justice.

The appellant, Dan Matthews, was convicted of rape and kidnapping and sentenced as an habitual offender to 140 years imprisonment. He argues the Trial Court erred by (1) not recusing generally after recusing from hearing a motion for attorney’s fees and costs, (2) refusing to grant relief due to the State’s violation of Matthews’ right to a speedy trial, and (3) refusing to suppress a pretrial identification given by the victim. We find no error and affirm.

The State alleged that in the early morning of January 30, 1991, the female victim went to a restaurant to eat. While inside, she was approached by a man who asked to be taken to the hospital because his wife had been in a car accident. She agreed, and on the way to the hospital the man pulled out a knife and told her to stop the car in a parking lot. He then threatened her with the knife and raped her.

The victim stated she had several opportunities to see the assailant’s face, and she described his facial features. She testified the man told her he worked at Con-Agra in Batesville. The investigating officer prepared a photo lineup which included photographs of six men she believed approximately matched the victim’s description. The victim was shown the lineup the day after the assault and was “almost positive” Matthews was her assailant. During a hearing on a motion to suppress, the victim testified she went to high school with one suspect in the lineup and had seen two others before.

A week after viewing the photo lineup the victim was taken to Con-Agra where she viewed employees leaving the plant and positively identified Matthews. Matthews was arrested February 1,1991. At the trial, held May 5,1992, the victim testified she was one hundred percent sure Matthews committed the crime.

1. Disqualification

Prior to trial, appointed defense counsel moved for interim attorney’s fees and costs incurred in connection with the case. A hearing was conducted on the motion. Judge John Dan Kemp, on whose docket the case appeared, recused from the hearing on the motion. Prior to the case proceeding to trial, defense counsel moved for Judge Kemp’s recusal from the case generally. Judge Kemp declined.

In his order responding to the recusal motion Judge Kemp explained that he had recused from hearing the fees motion because at the time he owned a building in which defense counsel rented office space. His financial relationship with counsel could have been perceived as having an effect on his decision whether to award the fees sought. By the time of the trial, the landlord-tenant relationship between the judge and counsel had ended, and thus Judge Kemp denied the motion.

Judges must refrain from presiding over cases in which they might be interested and avoid all appearances of bias. Ark. Const, art. 7, § 20; see also Arkansas Code of Judicial Conduct Canon 3(C) (1988); City of Jacksonville v. Venhaus, 302 Ark. 204, 788 S.W.2d 478 (1990); Patterson v. R.T., 301 Ark. 400, 784 S.W.2d 777 (1990). The matter of whether to disqualify is to be determined in the sound discretion of the judge in question, and we will not reverse absent abuse of discretion. Woods v. State, 278 Ark. 271, 644 S.W.2d 937 (1983).

While it was proper for Judge Kemp to avoid the appearance of impropriety by declining to hear a matter in which he could have been thought to have a financial interest, we see no reason why he should have further recused from the entire case. This situation is not like the one in Hobson v. Cummings, 259 Ark. 717, 536 S.W.2d 132 (1976), where the Trial Court continued to conduct ancillary matters after recusing from the case generally. In that case our decision that the judge improperly conducted a contempt proceeding was founded upon the order assigning the case to another judge. The order specifically included all ancillary proceedings.

Nor is this case like Bolden v. State, 262 Ark. 718, 561 S.W.2d 281 (1978), in which we wrote that a trial judge who disqualified “from participating in [the] case” at the beginning of a pretrial conference lost jurisdiction except to “make the proper transfer. . .or take. . .steps for the selection of another judge.” Prior to the assignment of another judge, the judge who had disqualified selected and instructed a jury commission and ruled on a motion challenging the charges against the defendants. We held those acts were improper. The distinction from the case now before us is obvious.

Although we have found no Arkansas cases directly on point, there- is authority for the proposition that, absent a statutory provision to the contrary, a determination of disqualification will not prevent a judge from reassuming full jurisdiction if the disqualification has been removed. See, e.g., Miller-Vidor Lumber Co. v. Schreiber, 298 S.W. 154 (Tex. Civ. App. 1927); Bank of Marlinto v. Pocahontas Development Co., 106 S.E. 881 (W.Va. 1921); Disqualification of a judge in pending case as subject to revocation or removal, 162 A.L.R. 641 (1946).

Two Florida cases, Florida Patient’s Comp. Fund v. Von Stetina, 474 So.2d 783 (Fla. 1985), and Margulies v. Margulies, 528 So.2d 957 (Fla. Dist. Ct. App. 1988), are particularly instructive. In the Von Stetina case, Justice Ehrlich of the Florida Supreme Court partially recused from hearing the issue of attorney’s fees but participated in the remaining issues on appeal. In denying a general suggestion of disqualification, Justice Ehrlich stated the attorney’s fee issue was legally and procedurally severable from the remaining issues. The opinion of the Court specifically approved the procedure.

In the Margulies case, a Florida Court of Appeals recognized the general rule that a disqualified trial judge is prohibited from taking any further action in the case but distinguished the Von Stetina case because it involved a partial recusal on a severable issue.

Judge Kemp’s disqualification was only with respect to the hearing on attorney’s fees and not from the entire case. He considered the fees issue to be severable from the merits of the criminal trial, and we agree. The reason for his disqualification from the hearing on fees had disappeared by the time the recusal motion was made. There was no abuse of discretion.

2. Speedy trial

Matthews argues the Trial Court erred by not releasing him on his own recognizance nine months after he was arrested as required by Ark. R. Crim. P. 28.1(a). Alleged violation of Rule 28.1(a) is not a basis for reversal. Jurney v. State, 298 Ark. 91, 766 S.W.2d 1 (1989).

He also contends, however, that the State failed to bring him to trial within 12 months from the date of his arrest or the date the information was filed as required by Ark. R. Crim. P. 28.1(b), and thus the charges should have been dismissed.

Matthews was arrested and charged February 1,1991. Barring excluded periods, he should have been brought to trial by February 1,1992. The trial began May 5,1992,93 days after the 12 month period in Rule 28.1 (b) had expired. The burden was on the State to show the 93 day delay was caused by Matthews’ conduct or was otherwise legally justified. Glover v. State, 307 Ark. 1, 817 S.W.2d 409 (1991).

Matthews moved for a preliminary hearing on April 12, 1991. A docket notation of May 14,1991, showed the motion was taken under advisement after a hearing. The Court issued its ruling June 14, 1991. Arkansas R. Crim. P. 28.3(a) permits the exclusion of time during which a pretrial motion is held under advisement, not exceeding 30 days. Smith v. State, 303 Ark. 524, 798 S.W.2d 94 (1990). The Court thus properly found 30 days excluded from the speedy trial calculation.

Another docket notation showed the case continued on October 31, 1991, on Matthews’ motion, and the trial rescheduled for January 7,1992. Arkansas R. Crim. P. 28.3(c) provides the period of delay resulting from a continuance granted at the defendant’s request is excluded. The period of delay is calculated from the date the continuance is granted until the subsequent date contained in the order. The Court thus properly excluded an additional 68 days. As these two periods add up to 98 days of excluded time, we need not address other periods the State alleges to have been excludable.

3. Pretrial identification

Matthews argues the pretrial identification procedures were unduly suggestive because he was the only suspect in the first photo lineup who was included in the second “lineup” at the Con-Agra plant. Relying exclusively on Foster v. California, 394 U.S. 440 (1969), he contends these pretrial identifications should not have been admitted. He does not contest the admissibility of the victim’s in-court identification, and we must assume it was reliable. When a photographic identification is followed by an eyewitness identification at trial, the conviction will be set aside only if the photographic show up was so suggestive as to create a substantial possibility of misidentification. Fountain v. State, 273 Ark. 457, 620 S.W.2d 936 (1981); Robinson v. State, 275 Ark. 473, 631 S.W.2d 294 (1982).

Matthews argues the factual similarity of the case to Foster v. California, supra, requires that the photo lineup and the resulting tainted identification at the Con-Agra plant be suppressed. We find the Foster case easily distinguishable. There, a witness was unable to make a positive identification during a lineup so police asked him to view a second lineup. The accused was the only person in the second lineup who had been in the original. Afterwards, the victim made a positive identification of the accused. The Supreme Court reversed the conviction and stated:

The suggestive elements in this identification procedure made it all but inevitable that the victim would identify petitioner whether or not he was in fact “the man.” This procedure so undermined the reliability of the eyewitness identification as to violate due process.

See also Moser v. State, 287 Ark. 105, 696 S.W.2d 744 (1985); Glover v. State, 276 Ark. 253, 633 S.W.2d 706 (1982). The fact that the accused was the only suspect included in the second lineup who had been in the first was only one item the Court considered in determining the procedure to be unduly suggestive and thus unreliable.

Here, the victim made an “almost positive” identification of Matthews in the photo lineup. There is nothing to suggest that the police knew the victim was acquainted with some of the persons pictured. While we understand Matthews’ suggestion that viewing the employees leaving the Con-Agra plant was analogous to conducting a second lineup, the viewing there was a very different sort of event. Unlike the Foster case, there is no legitimate insinuation that the police arranged Matthews’ appearance after the victim had been shown his picture in order to suggest him as the culprit.

Affirmed.


source: Caselaw Access Project

author: Tom Glaze, Justice.

license: Public Domain

text:
    Harold Morris McKINZY v. STATE of Arkansas
    CR 93-79
    853 S.W.2d 888
    Supreme Court of Arkansas
    Opinion delivered June 1, 1993

      William R. Simpson, Public Defender, by: Andy O. Shaw, Deputy Public Defender, for appellant.

      Winston Bryant, Att’y Gen., by: Clint Miller, Senior Asst. Att’y Gen., for appellee.
   Tom Glaze, Justice.

Harold Morris McKinzy appeals his two convictions of aggravated robbery of two employees of a Harvest Foods store in Little Rock. The employees, Karen Harbour and Johnny Dale Burris, were closing and leaving the store shortly after midnight on February 14, 1992. When Harbour was locking the door as she left, McKinzy placed his arm around Harbour’s throat, stabbed her in the back with a knife and threw her to the ground. He grabbed a sack Harbour was carrying, looked in it and found only some greeting cards. McKinzy, holding the knife, resumed his menacing attack on Harbour, and she fought back, screaming. Burris heard Harbour’s screams, and went to her rescue. While Burris was engaged in combat with McKinzy, Harbour, at Burris’s behest, returned inside the store, locked the door and dialed 911 for help. Meanwhile, Burris fought McKinzy by throwing a one hundred pound item described as a “paper machine” at McKinzy and by hitting him with a garbage can Burris found in the store parking lot. During this fight, McKinzy stabbed and slashed Burris repeatedly, demanding Burris to “give me the money.” McKinzy, during the early stage of combat with Burris, had picked up a bag Burris was carrying, looked in it and apparently was again foiled by finding no money.

Two men, Mark C. Barnhill and Stephen Criner, had heard Harbour’s screams, saw her and Burris in distress and went to their aid. Upon Barnhill’s and Criner’s arrival at the scene, McKinzy saw them and ran away. Barnhill and Criner pursued and caught McKinzy, but not without a struggle. The police then arrived and placed McKinzy under arrest.

McKinzy’s sole argument on appeal is that he committed only one aggravated robbery, not two, because he sought to take only the store’s money, therefore, just one transaction occurred. He relies on Wheat v. State, 297 Ark. 502, 763 S.W.2d 79 (1989), where this court held the course of conduct by Wheat resulted in one offense of aggravated robbery, and not three, even though three persons were present in a pharmacy when it was robbed. There, Wheat, who was armed with a pistol, entered the pharmacy, forced two clerks to lie on the floor while he ordered the third person, a pharmacist, to gather money and narcotics. The court held Wheat’s robbery was one single transaction because Wheat neither took nor manifested any intention of taking property from two of the three pharmacy personnel. Such is not the situation before us now.

We have said that the Arkansas Criminal Code, in redefining robbery, focuses on the threat of physical harm to the victim and that one consequence of the definition is that the offense is complete when physical force is threatened; no transfer of property need take place. Robinson v. State, 303 Ark. 351, 797 S.W.2d 425 (1990); Mitchell v. State, 281 Ark. 112, 661 S.W.2d 390 (1983); Jarrett v. State, 265 Ark. 662, 580 S.W.2d 460 (1979). In Mitchell, the court, in defining aggravated robbery, explained that ownership is not an element of proof and that the offense of aggravated robbery was complete with the threat of physical harm and the intent to commit theft.

Here, McKinzy attempted and administered serious physical harm on Harbour and Burris when manifesting an intent to commit theft. First, he attacked Harbour, taking her bag but finding nothing in it. The result was the same when he looked into the bag that had been carried by Burris. McKinzy was looking for money belonging to Harvest Foods or, inferentially, for anything of value which these two store employees might have possessed. Whether the money McKinzy sought was Harvest Foods’ is of no consequence. The gravamen of the offense occurred when McKinzy attempted to inflict and did inflict serious physical injury upon each Harbour and Burris while at the same time manifesting an intent to find money in their possession.

For the reasons above, we affirm McKinzy’s two convictions of aggravated robbery.

       No argument or discussion was made concerning whether Wheat was guilty of aggravated assault of the two clerks who were threatened and forced to lie on the pharmacy’s floor.


author: Donald L. Corbin, Justice.

text:
    Ray BRASEL v. Carroll Dean BRASEL
    93-227
    854 S.W.2d 346
    Supreme Court of Arkansas
    Opinion delivered June 1, 1993

      Roy E. Danuser and Griffin Smith, for appellant.

      Van Thomas Younes, for appellee.
   Donald L. Corbin, Justice.

Appellants in this case filed suit to enforce a trust they alleged had been established by Ray Brasel. Appellants alleged Ray Brasel, the father of Carroll Dean Brasel, deeded property to Carroll Dean Brasel and his wife, Shelby J. Brasel, in trust in a deed dated August 27, 1982. Appellants alleged that while the deed appeared “absolute on its face, the conveyance was actually in trust, the terms of which were that [Carroll Dean Brasel] was to share equally with all descendents of Ray Brasel.” At trial, appellants made clear that they were trying to establish a constructive trust and not an express trust. The chancellor determined that the evidence was clear and convincing that the land was deeded to appellee with the understanding that Ray Brasel would have a place on the land to live for the remainder of his life and imposed a constructive trust “to the extent that [Ray Brasel] is found to hold a life estate in and to the said property and the said deed is declared to be subject to said life estate.” As to the claim of the remaining appellants, Ray Brasel’s descendents and appellee’s siblings and their children, the chancellor determined that there was not clear and convincing evidence that appellee either agreed to pay money to or share the property with his siblings. Therefore, the chancellor refused to impose a constructive trust for the benefit of Ray Brasel’s descendants. Appellants appeal the decision of the chancellor limiting the relief to a life estate in Ray Brasel instead of a constructive trust for the benefit of all appellants. Appellants assert two points on appeal. They are:

I. The chancellor erred by limiting relief to a life estate in Ray Brasel without designating his remaining heirs as remaindermen.
II. The chancellor erred by holding the deed was a gift and then reforming the deed because gifts are not susceptible to reformation.

Appellants’ only argument as to point one is that appellee is estopped from asserting his claim of complete personal ownership by the finding of the chancellor that he holds the property in constructive trust. Appellants contend it is a well settled rule that a trustee cannot assert an interest adverse to the trust and appellee is therefore prevented from asserting his claim of complete ownership. While this is a well settled rule, the rule applies to trustees of express trusts and the case appellants cite for this proposition involves an express trust. In this case the chancellor did not find that an express trust existed, he found that a constructive trust should be imposed. A constructive trust is distinctly different from an express trust. As explained in Scott on Trusts,

[T]he constructive trust, unlike the express trust, is a remedial and not a substantive institution. A constructive trust bears much the same relation to an express trust that a quasi-contractual obligation bears to a contract. In the case of a constructive trust, as in the case of quasi-contract, an obligation is imposed not because of the intention of the parties but in order to prevent unjust enrichment.
It is not infrequently said that where a person would be unjustly enriched if he were permitted to retain property, a court of equity “converts him into a trustee.” The expression is misleading. The defendant is not converted into a real trustee. He is not even treated as though he were a real trustee, except that he is not permitted to retain the property for his own benefit. One would hardly say that where a quasi-contractual obligation is imposed the court converts the defendant into a contractor, or converts the obligation into a contract.
. . . [I]t is useless if not mischievous to attempt to phrase a definition of a trust so as to include both express trusts and constructive trusts. They are distinct concepts. They are not two species of a single genus. [Emphasis added] [citations omitted].

William F. Fratcher, Scott on Trusts § 462.1 at 312 (4th ed. 1989). Therefore, appellee is not a real trustee and appellants’ argument does not apply.

For appellants’ second argument on appeal, they contend the chancellor erred by finding the deed was a gift and then reforming the deed to reserve a life estate for Ray Brasel. Appellants also contend that since the conveyance involved a constructive trust the deed is a nullity. Appellants cite no authority for the proposition that the deed is a nullity since the chancellor imposed a constructive trust. To the contrary, the deed is not affected except that appellee holds title subject to Ray Brasel’s right to live on the property for life which the chancellor imposed by constructive trust. The chancellor found the deed to be valid and he imposed a constructive trust for Ray Brasel’s benefit.

Appellants next contend that as a gift, it was beyond the chancellor’s power to change the provisions of the deed and, thus, appellee held the land as trustee. The chancellor did not reform the deed as appellants allege. The chancellor imposed a constructive trust on appellee limiting his use of the property conveyed by the deed. The two are not the same. As trustee, appellants contend appellee could not assert full ownership of the land. As discussed above, this prohibition against a trustee asserting an interest contrary to the trust applies to express trusts, not constructive trusts.

While this court reviews chancery cases de novo we will not reverse the findings of fact by the chancellor unless they are clearly erroneous, giving due weight to the superior position of the chancellor to judge the credibility of the witnesses. Nunley v. Orsburn, 312 Ark. 147, 847 S.W.2d. 702 (1993). Since appellants have not demonstrated that the chancellor’s findings of fact were clearly erroneous, we affirm.

Brown, J., not participating.


text:
    Cheryl COCKMAN v. STATE FARM AUTOMOBILE INSURANCE COMPANY
    92-1308
    854 S.W.2d 343
    Supreme Court of Arkansas
    Opinion delivered June 1, 1993

      David Hodges and Josh McHughes, for appellant.

      Matthews, Sanders, Liles & Sayes, by: Gail O. Matthews and Marci Talbot Liles, for appellee.
   Donald L. Corbin, Justice.

Appellee, State Farm Mutual Automobile Insurance Company (State Farm), brought suit for a judgment declaring that it did not owe its insured’s attorney an attorney’s fee for his efforts in settling its insured’s claim for property damages against the tortfeasor. The case was submitted to the trial court, sitting without a jury, on stipulated facts. The trial court declared that the insured’s attorney was not entitled to a fee from State Farm under the facts presented. We find no error and affirm.

Appellant, Cheryl Cockman, suffered personal injuries and property damages in an automobile collision. Appellant retained counsel, David Hodges, to represent her in her claims arising out of the accident. Appellant was insured by appellee State Farm. The other driver involved in the accident was insured by Liberty Mutual Insurance Company (Liberty Mutual).

Pursuant to its insurance policy with appellant, appellee paid appellant $6,781.60 for property damages, $2,031.10 for personal injuries, and took an $8,000.00 subrogation receipt from appellant on the collision and rental coverages of the policy. Appellee informed Liberty Mutual of its subrogation rights. With representation from Hodges, appellant settled her claims for personal injury and property damage with Liberty Mutual for $10,000.00 and $9,500.00 respectively. Pursuant to Ark. Code Ann. § 23-89-207 (Repl. 1992), appellee paid its share of Hodges’ fee for the settlement of personal injuries, but refused to pay any of Hodges’ fee for settlement of the property damage. Thus, the issue on appeal is whether appellee is liable for its representative share of Hodges’ fee in settling appellant’s claim for property damages. According to the stipulated facts presented at trial, the amount in issue here is one-third of $6,781.60.

The trial court’s order entered in this case states as follows:
The Court, after studying the briefs, stipulations and exhibits finds:
(1) That Plaintiff did all it could do in this instance.
(2) That the inter-company arbitration agreement between State Farm and Liberty Mutual takes precedence over Defendant’s claim for an attorney’s fee.
(3) That Plaintiff does not owe Defendant an attorney’s fee for collection of the collision damage.
IT IS THEREFORE, by the Court, Considered, Ordered and Adjudged that Plaintiffs complaint for a declaratory judgment to the effect that it does not owe Defendant an attorney’s fee on the collision loss be and the same is hereby granted.

For reversal of the foregoing order, appellant relies on Washington Fire & Marine Ins. Co. v. Hammett, 237 Ark. 954, 377 S.W.2d 811 (1964), and Commercial Standard Ins. Co. v. Combs, 249 Ark. 533, 460 S.W.2d 770 (1970). Those two cases announce a general rule that when an insurer makes payments under a policy to its insured and takes subrogation rights but does nothing to enforce those subrogation rights against the tortfeasor or the tortfeasor’s insurer, that insurer must pay its fair share of the attorneys’ fees its insured incurs in making a recovery from the tortfeasor’s insurer. This general rule is based on the equitable principles embodied in the concept of subrogation. See Combs, 249 Ark. at 541, 460 S.W.2d at 775; Hammett, 237 Ark. at 956, 377 S.W.2d at 813.

Appellant also contends that appellee should not be permitted to rely on the arbitration agreement between it and Liberty Mutual as a defense to bearing its share of Hodges’ fee. Appellant claims that appellee did not invoke the protection of the arbitration agreement when it put Liberty Mutual on notice of its subrogation lien, nor did it notify appellant, Hodges, or Liberty Mutual of the arbitration agreement prior to the settlement.

Appellant continues with the argument that pursuant to Hammett and Combs, she cannot split her claims for personal injury and property damage, thus she was required to pursue both claims simultaneously. In other words, had the case been forced to the point of litigation, the causes of action for personal injury and property damage could not be split so as to allow the arbitration agreement to determine the subrogated claim for property damage of $6,781.60 while also allowing the resulting litigation to determine the remaining claims. See Combs, 249 Ark. 533, 460 S.W.2d 770; Hammett, 237 Ark. 954, 377 S.W.2d 811.

Appellee responds with the argument that it actively pursued its subrogation rights and therefore should not be required to pay any portion of Hodges’ fee. In support of this argument, appellee points to several letters it wrote to Liberty Mutual notifying Liberty Mutual of its subrogation lien, itemizing total payments appellee made to appellant, and requesting Liberty Mutual to correspond directly with appellee concerning the accident in question. Appellee also argues that it never requested Hodges to pursue its claims and never hired him to do so. In short, appellee contends that it never consented to having Hodges represent its subrogation rights and that it actively pursued its subrogation rights; therefore, it did not benefit from the settlement Hodges reached and should not have to participate in the fees.

While we are inclined to sympathize with appellant as to her foregoing arguments, we cannot do so for three reasons — (1) because of the terms of the arbitration agreement, (2) because of the particular facts presented, and (3) because of the terms of the subrogation receipt.

The arbitration agreement referred to here is a document entitled “Automobile Subrogation Arbitration Agreement” to which both appellee and Liberty Mutual have agreed to be bound by. This inter-company arbitration agreement requires that involved companies forego litigation and submit to arbitration any questions or disputes arising from any automobile physical damage subrogation or property damage claim not in excess of $100,000.00. The rules and regulations promulgated in accordance with the arbitration agreement require that as a condition precedent to arbitration, involved companies must make sincere efforts to settle controversies by direct negotiation.

As appellee points out, it acted in accordance with the arbitration agreement and made an effort to settle the subrogation claim by communicating directly with Liberty Mutual. Liberty Mutual also acted in accordance with the arbitration agreement and protected appellee’s subrogation rights by including appellee’s name on the settlement check. Appellee and Liberty Mutual agreed to follow the arbitration agreement in cases such as the present, and they acted in accordance with that agreement with respect to this case.

Appellee’s actions in communicating directly with Liberty Mutual about the subrogation claim render Hammett and Combs inapplicable. Those cases are based on an insured’s inaction or refusal to pursue the subrogated claims. The record is clear that in the present case there is no inaction or refusal of appellee to pursue its subrogation claim. Thus, the particular facts of this case are such that the reasoning and holding of Hammett and Combs do not apply.

In the subrogation receipt, appellant agreed to allow appellee to enforce its subrogation rights by taking any action which may be necessary in its own name or in appellant’s name. Appellant also warranted that she had made no settlement or release regarding the subrogated rights and would not do so without appellee’s written consent. As appellee points out, it did not give its consent for Hodges to settle its subrogation rights. The subrogation agreement between appellant and appellee requires that consent; moreover, it requires that consent to be in writing. Thus, appellee was authorized by appellant to proceed on the subrogated property damages claim, and, in the absence of the consent required by the subrogation receipt, no prejudice resulted to appellant or Hodges by appellee’s failure to disclose the arbitration agreement.

Therefore, in accordance with the arbitration agreement, Hammett and Combs, and the subrogation receipt, we cannot say the trial court erred in holding that appellee was not required to pay any portion of the attorney’s fees appellant incurred in settling her property damage claim with Liberty Mutual.

The judgment is affirmed.


author: Robert L. Brown, Justice. Steele Hays, Justice,

text:
    FORD MOTOR COMPANY and Quality Ford, Inc. v. Dean MASSEY
    92-1153
    855 S.W.2d 897
    Supreme Court of Arkansas
    Opinion delivered June 1, 1993

      Baker & McKenzie and Wright, Lindsey & Jennings, for appellants.

      Baker, Wallace, Jensen & McCalliser and Greene Law Offices, for appellee.
   Robert L. Brown, Justice.

Two issues are raised by the appellants, Ford Motor Company and Quality Ford, Inc., in this appeal: 1) whether the trial judge erred in refusing to grant a judgment notwithstanding the verdict due to the absence of a reasonable basis for the expert’s opinion presented on behalf of the appellee, Dean Massey; and 2) whether the trial judge further erred in refusing to strike evidence of warranty occurrences not sufficiently similar to the case at hand. We hold that the trial judge did not abuse his discretion in either instance, and we affirm the verdict and judgment. Dean Massey also cross-appeals on several issues which are to be entertained only in the event that we reverse the judgment. Because we affirm the judgment, we do not reach the issues on cross appeal.

On August 28, 1990, Dean Massey and his wife, Connie Massey, were gathering hickory in a wooded area near their Saline County home to use in a barbecue. Dean backed up the couple’s 1986 Ford Bronco near to some hickory saplings. He got out of his truck and walked several feet behind it in order to fasten a chain around two of the trees. Connie moved to the driver’s seat and began to back the Bronco toward the trees so that Dean could attach the chain to the truck.

Dean next heard the engine rev. He looked up and saw the Bronco three feet away “coming fast” toward him. He cried out twice to his wife, but she was unable to stop the truck. Witnesses testified at trial that Dean was caught underneath the vehicle and dragged over the hickory saplings, a five-inch-thick pine tree, and thigh-high underbrush. Photos and testimony revealed a 62 foot swath cut through the woods. Dean suffered neck and back fractures, which severed his spinal cord and rendered him a quadriplegic. He admitted at trial that his recollection of the incident was sketchy.

Within a short period of time following the incident, Connie Massey gave differing statements of what happened, though by all accounts she was distraught. She told one witness that the Bronco kept going after she took her foot off the accelerator. She told a second witness that the truck ran over her husband and something was wrong with it. She related to the West Pulaski County Fire Chief that her foot got caught between the brake and gas pedal. And she told a Saline County Deputy Sheriff that her foot slipped off the brake and hit the accelerator.

On August 21, 1991, Dean and Connie Massey filed a tort action against the appellants, Ford Motor Company and Quality Ford, Inc., on the basis that the throttle cable assembly of their 1986 Ford Bronco was defective. They alleged 1) that the suppliers of the vehicle negligently failed to warn them of a defect in the product, and 2) that Ford and Quality were strictly liable for placing a defective product in the stream of commerce. Before the matter was brought to trial, Connie Massey died in an auto accident. At trial, the Saline County Circuit Court directed a verdict for Ford and Quality on the failure-to-warn claim following Massey’s case but permitted the strict liability claim to go to the jury. After seven days of trial, the jury returned a $7 million verdict on the strict liability claim, with interest to accrue at 8 fi percent per annum. Ford and Quality then filed a motion for judgment N.O.Y., raising the same issues that are the substance of this appeal. That motion was denied.

I. REASONABLE BASIS FOR EXPERT OPINION

Ford and Quality argue, as their first point for reversal, that Dean Massey’s expert witness, Larry Pipes, had no reasonable basis for his opinion that Dean’s injuries were caused by a defect in the 1986 Ford Bronco at the time it was originally sold. Because of that, they contend, the trial judge erred in failing to grant their motion for judgment notwithstanding the verdict.

On review of a trial judge’s denial of a motion to set aside a jury verdict on liability, the question is whether the verdict is supported by any substantial evidence. Johnson v. Clark, 309 Ark. 616, 832 S.W.2d 254 (1992); Minerva Enterprises, Inc. v. Howlett, 308 Ark. 291, 824 S.W.2d 377 (1992). The evidence most favorable to the appellee is given the benefit of all reasonably permissible inferences. Johnson v. Clark, supra; Scott v. McClain, 296 Ark. 527, 758 S.W.2d 409 (1988).

A properly qualified expert’s opinion constitutes substantial evidence unless it is shown that the expert’s opinion is without reasonable basis. Wallace v. Williams, 263 Ark. 702, 567 S.W.2d 111 (1978). If there is no sound and reasonable basis for expert testimony, the testimony is subject to being stricken. If, however, the cross-examination shows that the testimony has a weak or questionable basis, that goes to the weight and credibility to be given the testimony rather than to its admissibility. Ishie v. Kelley, 302 Ark. 112, 788 S.W.2d 225 (1990); Jim Paws, Inc. v. Equalization Bd. of Garland Co., 289 Ark. 113, 710 S.W.2d 197 (1986). The weight and value to be given to the testimony of expert witnesses lies within the exclusive province of the jury. B & F Engineering, Inc. v. Cotroneo, 309 Ark. 175, 830 S.W.2d 835 (1992). Whether a witness may give expert testimony rests largely within the sound discretion of the trial judge, and that determination will not be reversed absent an abuse of discretion. Montgomery v. Butler, 309 Ark. 491, 834 S.W.2d 148 (1992).

In the case before us, the expert in question, Larry Pipes, was the owner of a Missouri-based auto repair firm and an auto mechanic training and consulting firm. In Pipe’s expert opinion, an “internal fault” in the throttle cable assembly caused the accident and injury to Dean Massey. In his examination of the vehicle, Pipes testified that he disconnected both ends of the throttle assembly — which consists of a stainless steel cable running through a conduit, plus springs, sockets, and fittings — and manually manipulated the steel cable through the conduit. While moving the cable back and forth, Pipes stated, he felt a “resistance to motion” which he described as a “rough spot” or a “stiff point” and which he felt was attributable to an “internal fault.” He ultimately concluded that the throttle cable assembly had “hung” on the day of the accident after Connie pressed down on the accelerator which he described as “hard” or “stiff’ and that the cable was defective when manufactured.

Ford and Quality urge that Pipe’s opinion contained four analytical flaws. Essentially, they urge 1) that Pipes’s opinion was based on an irrelevant test, 2) that the cable had not stuck previously for 51,000 miles before the accident, 3) that Pipes’s opinion was at odds with the testimony of the appellee himself, and 4) that it was contradictory to the testimony of the only witness with personal knowledge of the condition of the vehicle shortly after the accident — Bobby Green, a mechanic. According to the appellants, in normal operation the cable is never pushed, as described by Pipes. Instead, it is pulled toward the passenger compartment when the driver depresses the accelerator pedal and is pulled back toward the engine by three return springs when the pedal is released. Ford’s own expert, Lee Carr, a mechanical engineer, likened pushing on the cable to pushing on a rope.

Although Pipes agreed, under cross-examination, that during normal operation of the vehicle, the cable is pulled rather than pushed, he asserted that the pushing test is “as valid [a test] as every Board Mechanic in America would use.” Moreover, he described the operation of the steel cable and conduit in great detail and testified that he had built throttle cable assemblies himself and was quite familiar with the design and materials used in the Bronco’s assembly. The steel cable, he testified, was designed to move freely within the conduit when pulled toward the passenger compartment by depressing the accelerator or returned to its original position by the springs.

It is the prerogative of the jury to believe or to disbelieve the testimony of any witness. Johnson v. Clark, supra; Hodges v. Jet Asphalt & Rock Co., 305 Ark. 466, 808 S.W.2d 775 (1991). Where there is a conflict in the testimony and evidence presented by an expert, the determination by the jury of the issues is conclusive. B & F Engineering, Inc. v. Cotroneo, supra. In this case, the essential component of Larry Pipes’s testimony was that he felt a rough spot or stiff point as he manually manipulated the cable through the conduit, which he attributed to an internal fault. We cannot say that this explanation was not reasonable. The jury was entitled to believe him or not.

The appellants argue on a related point that even if the pushing test provides a reasonable basis for the expert’s opinion, it still supplies no evidence that the presumed internal fault would cause the cable to catch during normal operation. This also was a credibility matter for the jury to assess. As Dean Massey noted, Pipes spoke with Connie Massey after the accident. Connie Massey had been “clear” that she was not depressing the gas pedal when the truck continued to accelerate. When an expert’s testimony is based on hearsay, lack of personal knowledge does not mandate an exclusion of the opinion but instead presents a jury question concerning the weight to be attached to that opinion. Dixon v. Ledbetter, 262 Ark. 758, 561 S.W.2d 294 (1978). There was, too, additional evidence that the throttle cable had hung. A mechanic, Bobby Green, testified that the Bronco engine was revving at 2400 rpms the next day, and there was physical evidence that the Bronco had plowed through the woods for 62 feet.

The appellants also emphasize that there is no evidence that the throttle cable stuck previously during the Ford Bronco’s 51,000 miles of travel. Countering this, Larry Pipes testified that the life of the throttle cable should be the life of the vehicle and that in his judgment the cable was defective when manufactured and sold by Ford and that this caused the accident. His reasons for concluding that the defective cable precipitated the accident have already been stated in this opinion. Again, these were all evidentiary matters for the jury to weigh and evaluate. B & F Engineering, Inc. v. Cotroneo, supra

The appellants then point to the different construction that Pipes placed on the testimony of Bobby Green, who had driven the Bronco the morning after the accident and who found the engine revving excessively. Green testified that he had looked under the hood and saw no foreign object holding the throttle open and determined that the problem was somewhere in the fuel system. Pipes observed that if Green was looking for a foreign object, he would not have been focusing on a hung cable. We do not view the testimony of Bobby Green and Larry Pipes as irrevocably in conflict. Green, by his own admission, did not do a thorough inspection of the problem but only looked to see if something was holding the throttle open. His first thought was that the problem lay in the fuel system. Pipes’s explanation is not unreasonable, and we do not view the testimony as incompatible.

Finally, the appellants insist that, in order to reach the conclusion that an internal fault caused the accident, Pipes had to disregard the testimony of the only living eyewitness to the accident — the appellee himself. Dean Massey testified that his best estimate was that the Bronco was only three feet away when the engine began to rev. The only thing which could have caused the engine to rev initially, the appellants say, was Connie Massey’s depression of the accelerator pedal. At that point, as Pipes conceded, the accident had already been determined. Yet Pipes emphatically rejected Dean Massey’s estimate that three feet was the actual physical distance traveled by the rapidly accelerating vehicle. “I believe that’s when he realized he was in peril,” Pipes observed, “and that’s what’s emblazoned in his memory.” Massey himself testified that his memory of the accident was sketchy and that the estimated distances were approximations.

Ford and Quality cite us to a decision of the Michigan Court of Appeals, Green v. Ford Motor Co., 491 N.W.2d 243 (Mich. App. 1992), where the court excluded an accident reconstructionist’s testimony because he was unable to reconcile inconsistencies in his own account and the eyewitnesses’ accounts of an accident “other than by disparaging the witnesses’ powers of observation.” Id. at 247. Here, however, Dean Massey admitted that his recollection was imprecise. Pipes, on the other hand, used considerable data in arriving at his opinion. He visited the scene of the accident; he examined the Bronco and studied Ford’s warranty records; he interviewed Connie . Massey and Bobby Green, read all the depositions, and heard all the testimony; and he examined the throttle cable assembly. Based on this, he concluded that the steel cable had hung after Connie Massey depressed the accelerator which caused the Bronco to travel 62 feet in reverse and drag Dean Massey some distance through the woods.

The Arkansas cases cited by Ford and Quality provide no basis for excluding Pipes’s opinion testimony. Both Sims v. Safeway Trails, Inc., 297 Ark. 588, 764 S.W.2d 427 (1989), and Little v. George Feed & Supply Co., 233 Ark. 78, 342 S.W.2d 668 (1961), deal with the testimony of accident reconstructionists. In Sims, a case involving a bus accident, the expert had never seen the bus and was relying on a former graduate student’s report on the brakes. Moreover, the expert failed either to develop or to articulate an opinion regarding the cause of the collision when there was no dearth of proof relating to potential causes. Under the circumstances, we upheld the trial judge’s exclusion of the expert’s testimony. The present appeal, however, entails a different scenario. Here, Pipes did not agree with all of the other testimony but had the benefit of doing a comprehensive investigation before he formed his opinion.

In Little v. George Feed & Supply Co., supra, the expert witness based his testimony on evidence of highway gouges obtained at the scene of a collision seven months after the accident and on an inspection of the vehicles involved after one of the vehicles have been partially dismantled. On those facts, we affirmed the trial judge’s ruling of inadmissibility. In the present case, Pipes stated that he first examined the vehicle in November 1990, three months after the accident, and again in June 1991. The Bronco was still intact.

In sum, we hold that there was a reasonable basis for the expert’s conclusions and, thus, the trial judge was on sound footing in finding that Larry Pipes’s opinion testimony constituted substantial evidence. Accordingly, the appellants’ motion for judgment N.O.V. was properly denied.

II. EVIDENCE OF SIMILAR OCCURRENCES

For their second point, Ford and Quality urge that the trial judge erred in two respects regarding Plaintiffs Exhibit 7, a computer printout known as the SE-II report. The report contained 106 warranty repairs to the throttle cable assembly on 1986 Ford Broncos with the same engine and transmission as the appellee’s vehicle. First, they allege that Massey failed to show a substantial similarity between the incidents of cable failure in his Ford Bronco and the incidents of cable failure noted in the SE-II report which militated against its admissibility. Secondly, they assert that the trial judge erred in refusing to strike Exhibit 7 after he directed a verdict in favor of the appellants on Massey’s negligence claim.

The SE-II report listed 106 warranty repairs to the precise throttle cable assembly at issue in this case, each of which was assigned a code number to designate the reason for the cable assembly repair. Code number “41” stated that the throttle cable assembly “sticks, binds, grabs, seized.” There were 45 such repairs. The next highest number of repairs — 32 — was referenced by the number “01” for “broken, cracked.” Other codes denoted “improper adjustments,” “idles too fast,” “bent, kinked,” “split seams,” “loose,” “improperly routed,” “misaligned,” and other such descriptions. Some entries elaborated on the shorthand code, but most contained no comments.

The general rule with respect to the admissibility of evidence of similar occurrences is that it is admissible only upon a showing that the events arose out of the same or substantially similar circumstances. Westark Specialties, Inc. v. Stouffer Family, Ltd., 310 Ark. 225, 836 S.W.2d 354 (1992). The burden rests on the party offering the evidence to prove that the necessary similarity of conditions exists. Id. The relevancy of such evidence is within the trial judge’s discretion, subject to reversal only if an abuse of discretion is demonstrated. Turner v. Lamitina, 297 Ark. 361, 761 S.W.2d 929 (1988).

Whether an occurrence is substantially similar to the matter at hand depends on the underlying theory of the case. Four Corners Helicopters, Inc. v. Turbomeca, S.A., 979 F.2d 1434 (10th Cir. 1992); Wheeler v. John Deere Co., 862 F.2d 1404 (10th Cir. 1988). For example, evidence submitted to demonstrate a dangerous condition necessitates a high degree of similarity because it weighs directly on the ultimate issue to be decided by the jury. Id. But the requirement of substantial similarity is relaxed, when the evidence of other incidents is used to show notice or awareness of a potential defect in a product. Id.

In this case, after the trial judge directed a verdict in favor of the appellants on that issue, he refused to strike the SE-II report which was already in evidence or to instruct the jury not to consider it. In so ruling, he determined that the report would not prejudice the jury in its determination of the strict liability claim because the jury had a “clear understanding of the evidence.” He had previously refused to grant a motion in limine to exclude Exhibit 7 because it related specifically to the throttle cable and the repairs were “clearly defined.”

Ford and Quality complain that the jury was allowed to consider the warranty repairs as evidence of a defective condition without a showing on the appellee’s part of any substantial similarity. It was incumbent upon Massey, say the appellants, to present evidence to establish that the affected vehicles were used or maintained properly and that the cable assemblies in the code “41” vehicles stuck, bound, grabbed, or seized due to an internal fault. In addition, the appellants vigorously urge that of the various warranty repairs coded “41,” only eight involved a cable replacement which they contend is what Larry Pipes considered to be the only recourse for a defective cable. The other Code classifications, they contend, were simply dissimilar and, therefore, irrelevant and prejudicial.

We agree with the trial judge that the SE-II warranty report was limited to a catalogue of repairs involving part number 9A758, the precise throttle cable assembly at issue in the present case for the model of 1986 Ford Bronco owned by the appellee. Moreover, the Code phrases in the report were specific and summarized in a manner that was readily understandable. Furthermore, the SE-II report was analyzed at length by a Ford automotive engineer, Ken Waller, who was called as a witness by Massey, and then further analyzed by Larry Pipes. The jury was presented with thorough testimony on the exhibit relative to the repairs to the throttle cable assembly in question.

We turn to an Eleventh Circuit Court of Appeals decision for a case in point. See Hessen v. Jaguar Cars, Inc., 915 F.2d 641 (11th Cir. 1990). In Hessen, the district court permitted the introduction of evidence regarding customer complaints of various leaks of fuel and fumes in the Jaguar XJ6 series in connection with a products liability action relating to a car fire. The plaintiffs expert did not point to a specific defect, but concluded that the fuel hose and connector were defective because they had a tendency to leak in various places. The Eleventh Circuit upheld the admission of the complaints, and noted that “the timing and circumstances of the incidents were similar enough that the admission of evidence concerning other occurrences was not an abuse of discretion.” 915 F.2d at 650.

In Four Corners Helicopters, Inc. v. Turbomeca, S.A., supra, the Tenth Circuit Court of Appeals affirmed the decision of the district court which had allowed the introduction into evidence of sixteen reports of various repairs and a computer printout listing those reports which depicted similar incidents of screws backing out of an engine even though the similar incidents did not involve accidents or failures in flight which was the subject of that litigation. “The incidents,” declared the court, “though not identical, were substantially similar and were therefore admissible to indicate the existence of a defect. They further met any relaxed requirement of similarity and were therefore admissible for all purposes offered by plaintiffs.” 979 F.2d at 1440. The Tenth Circuit found no abuse of discretion by the district court.

The Arkansas cases cited by Ford and Quality to support abuse of discretion on substantial similarity questions are distinguishable on their facts. In Westark Specialties, Inc. v. Stouffer Family, Ltd., supra, the plaintiff attempted to prove substantial similarity of an insurance payment in connection with a previous lease without proving the content of the previous lease or the basis for the insurance company’s payment. In Turner v. Lamitina, supra, two traffic lights were the focus of the evidentiary issue, but they were never proved to be identical or to be operating in sequence or to come from the same central electric system. The dissimilarities in the proposed evidence in each case were striking.

We conclude that Exhibit 7 was relevant and that there was no showing of prejudice in the wake of the trial judge’s decision not to exclude or strike the exhibit. The repairs involved were analyzed, discussed, and distinguished in great detail by the Ford engineer and Larry Pipes. We note, too, that the exhibit is clear and straightforward, especially in the summary by code categories, which minimizes the potential for juror confusion on the several repair classifications.

After the directed verdict on the negligence claim and the judge’s decision not to strike Exhibit 7, trial counsel agreed not to refer to the exhibit again through testimony or by argument. Yet, the appellants made no effort to request a limiting instruction for the jury to disregard any part of the SE-II report. It is true that the appellants had the right to rely on their motion for mistrial and motion to strike. But in light of the trial judge’s ruling that Exhibit 7 represented no prejudice, a limiting instruction on certain SE-II codes was an option available to the appellants which could have been utilized and was not.

We cannot say that under these circumstances where the exhibit dealt with repairs to the identical equipment at issue in the case — the throttle cable assembly — and where the repairs were clearly analyzed and described by witnesses, the trial judge abused his discretion in refusing to exclude it or to strike it.

Affirmed.

Hayes, J., dissents.

Steele Hays, Justice,

dissenting. The existence of substantial evidence is a question of law. Fuller v. Johnson, 301 Ark. 14, 781 S.W.2d 463 (1989); St. Louis S.W. Ry. Co. v. Braswell, 198 Ark. 143, 127 S.W.2d 637 (1939). Hence, it is incumbent on the members of this court to satisfy ourselves that this verdict of seven million dollars is based on more than speculation and conjecture.

We have said substantial evidence is “competent” evidence:

Substantial evidence has been defined as “evidence that is of sufficient force and character that it will, with reasonable and material certainty and precision, compel a conclusion one way or the other. It must force or induce the mind to pass beyond a suspicion or conjecture.” Ford on Evidence, Vol. 4, § 549, page 2760. Substantial evidence has also been defined as “evidence furnishing a substantial basis of fact from which the fact in issue can reasonably be inferred; and the test is not satisfied by evidence which merely creates a suspicion or which amounts to no more than a scintilla or which gives equal support to inconsistent inferences.” Wigmore on Evidence, Vol. IX, 3rd ed § 2494, footnote at page 300. See also Tigue v. Caddo Minerals Co., 253 Ark. 1140, 491 S.W.2d 574; Goza v. Central Ark. Dev. Council, 254 Ark. 694, 496 S.W.2d 388.

Kroger Co. v. Standard, 283 Ark. 44, 48, 670 S.W.2d 803, 805 (1984).

Since this is a products liability case, it was necessary for the plaintiff-appellee to produce substantial evidence that this 1986 Ford Bronco had a defect which rendered it unreasonably dangerous and that the vehicle was manufactured or supplied in that condition. Ark. Code Ann. § 16-116-102 (1987). In my estimation the plaintiff-appellee has failed to produce evidence on either score which measures up to substantiality.

Appellee’s case rested on the testimony of Mr. Larry Pipes, who could not say what the defect was, only that he found what he “considered to be a stiff point” in the cable connecting the acceleration pedal to the throttle. He made no attempt to explain or define the condition other than to refer to it as “a rough spot,” “a stiff point” or “an internal fault” where the cable was “resistant to motion.” He described it as something he could not “see,” only “feel.” These characterizations led him to conclude that the cable had “a problem.” “Beyond that, I cannot tell you what specifically the problem is inside.”

These observations were arrived at after he had disconnected the cable at both ends and tested it by manually pushing one end of the cable. Before he removed the cable he did not experience “a hang-up.” I did not make a note of it, but I estimate that I pushed and released the gas pedal to check for a cable hang-up no less than a dozen and maybe two to three dozen times. Never once did it hang.” It is clear from the testimony that in normal operation the cable is never pushed. An expert for Ford testified that pushing the cable was comparable to pushing a rope and Mr. Pipes conceded that when the cable is attached it is either pulled by depressing the accelerator pedal, or pulled by the return springs when the pedal is released.

The testimony that the product was supplied in a defective condition is equally lacking. After the appellee had rested and appellant had moved for a directed verdict, appellee’s expert was recalled to testify to his opinion that the vehicle was in a defective condition when manufactured and sold by Ford. The only basis he gave for that opinion was that the anticipated life of the cable equalled the life of the vehicle.

That, too, fails to conform to the requirements of substantial evidence when weighed in the light of certain facts which are not in dispute, i.e. this product had been in use for over four years and 51,000 miles. The testimony of appellee and two previous owners was that the accelerator had never once malfunctioned in that entire period of time. Thus we are asked to conclude that a “defect” which is unexplained, unidentified and effectually nonexistent between June of 1986 and August of 1990, while the product was constantly in use, was nevertheless present when the vehicle was first introduced to the market. For my part, I am unable to treat the expert testimony as substantial evidence. We have said the testimony of witnesses, “whether lay or expert, cannot be regarded as substantial if they are unable to give any reasonable basis for their opinion.” Ark. State Hwy. Comm’n v. Carruthers, Et Ux, 246 Ark. 1035, 1039, 441 S.W.2d 84, 86 (1969). The testimony of experts is not substantial if they are unable to give “a sound and reasonable factual basis for their conclusions.” Ark. State Hwy. Comm’n v. Roberts, 246 Ark. 1216, 1220, 441 S.W.2d 808, 811 (1969). “Because a witness testifies to a conclusion on his part does not necessarily mean that the evidence given by him is substantial, when he has not given a satisfactory explanation of how he arrived at the conclusion.” Ark. State Hwy. Comm’n, et al. v. Byers, 221 Ark. 845, 851, 256 S.W.2d 738, 742 (1953).

To meet the test of substantial evidence, the opinion of an expert must have a reasonable and logical basis. Wallace v. Williams, 263 Ark. 702, 567 S.W.2d 111 (1978). And see generally Little v. George Feed & Supply Co., 233 Ark. 78, 342 S.W.2d 668 (1961); Miller v. State, 240 Ark. 340, 399 S.W.2d 298 (1966), and Bartels v. Waire, 289 Ark. 362, 712 S.W.2d 285 (1986).

The expert testimony in this case is aptly characterized in the Carruthers case, cited above, authored by Justice George Rose Smith. Although no fewer than ten witnesses gave opinions as to value equal to or above the amount of the verdict, this court reversed for lack of substantial evidence:

Whether there is substantial evidence to support a verdict is not a question of fact, but one of law. Because a witness testifies as to a conclusion on his part does not necessarily mean that the evidence given by him is substantial, when he has not given a satisfactory explanation of how he arrived at the conclusion.
* * * *
“The difficulty is in differentiating between any evidence and substantial evidence . . . Must appellate judges close their eyes and their minds to the obvious fact that in a particular case the evidence, from its very nature, could not have been convincing, though it produced a given result? Shall we affirm that such evidence was necessarily substantial because it was favorably acted upon by the jury?”

Carruthers at 1041-1042.

In contrast to the requirements expressed in those and a good many other cases, the testimony in this case amounts to merely a conclusion, an unvarnished opinion that a defect exists, with no attempt to provide a sound, reasonable or logical basis for that conclusion. That, I respectfully submit, fails to rise to the level of substantial evidence and a judgment notwithstanding the verdict should have been ordered.


author: Robert L. Brown, Justice.

text:
    Jeff MOBLEY and William F. Smith v. John T. HARMON, Ray Lee Robinson, Robert I. Darr and James A. Hatcher
    92-1052
    854 S.W.2d 348
    Supreme Court of Arkansas
    Opinion delivered June 1, 1993
    [Rehearing denied July 5, 1993.]

      Jeff Mobley and William F. Smith, by: John Lloyd Johnson, for appellants.

      Bowden Law Firm, by: David O. Bowden', and Gilbert Law Firm, by: Melinda Gilbert, for appellee.

      James Dunham, for appellee/cross-appellants.
   Robert L. Brown, Justice.

The appellants, Jeff Mobley and William F. Smith, raise multiple points in their appeal from a judgment for attorney’s fees in favor of appellee John T. Harmon. The appellees/cross-appellants, Ray Lee Robinson, Robert I. Darr, and James A. Hatcher, also bring a cross-appeal conditioned upon our reversal of the chancery court’s order. We affirm the chancery court in this case; the cross appeal is therefore moot.

In 1976, Legacy Lodges, Inc., was a corporation which had a nursing home business as its principal asset. The corporation was owned by four shareholders: appellee/cross-appellant Robert I. Darr (30 percent), James Williams (30 percent), Jeff Mobley (30 percent), and James Hatcher (10 percent). Darr assigned his interest in Legacy Lodges to Ray Lee Robinson.

In July 1976, the appellants’ law firm of Mobley & Smith acted as attorneys for the corporation and undertook negotiations for a settlement with Darr and Robinson arising out of the purchase of the assets of Legacy Lodges by Darr and Robinson. Negotiations failed, and on June 15, 1977, Mobley made a motion at a Legacy Lodges Board of Directors meeting to employ his partner, William Smith, to file suit against the two men. The motion passed, and Smith was hired on a fee basis that would allow him one-third of the recovery if the suit was settled out of court, 40 percent of the recovery in the event of a trial, and 50 percent of the recovery in the event of an appeal.

Smith wrote one demand letter. The corporation then determined that the services of another attorney were needed because Mobley, Smith’s partner, served as secretary-treasurer of the corporation and was a shareholder and a member of the Board of Directors. On October 5, 1977, Legacy Lodges filed a complaint in Pope County Chancery Court against Darr and Robinson. Harmon was shown as counsel for the corporation.

On October 21, 1977, at a Legacy Lodges shareholders’ meeting James Williams and Jeff Mobley were present, and James Hatcher was present by proxy. Williams, Mobley, and Hatcher were also members of the Board of Directors. Mobley made a motion, seconded by Williams, authorizing Williams to contact Harmon and negotiate a contract of employment on behalf of the corporation based on a fee schedule to be agreed upon by Williams and Harmon.

Harmon was the only attorney of record for Legacy Lodges in the Darr/Robinson litigation. Harmon did preliminary work on the matter but notified Mobley in 1984 that he was leaving the state and the practice of law and that it would be necessary for the corporation to hire another attorney. Negotiations were underway with another attorney to handle the case when, in 1987, Harmon returned to Arkansas and resumed his law practice.

According to testimony, a new contract of representation was entered into in 1987 between Harmon’s professional association, John T. Harmon & Associates, P.A., and Legacy Lodges. Its terms were the same as the earlier contract between Smith and the corporation: John T. Harmon & Associates would receive a 50 percent fee if the case were successfully appealed.

Harmon tried the case in chancery court and prevailed against Darr and Robinson. His principal witness was Mobley. The case was appealed to the Arkansas Court of Appeals, and Harmon, through his professional association, John T. Harmon & Associates, P.A., and Attorney William Wharton prepared the brief for Legacy Lodges. Harmon then argued the case before the Court of Appeals. That court affirmed the lower court’s decision in favor of the corporation in an unpublished opinion.

Darr and Robinson satisfied the judgment in 1988, at which time a dispute arose between Mobley and Harmon over the apportionment of attorney’s fees. Two checks had been made out to the prevailing parties and “their attorney, John T. Harmon”— one in the amount of $310,000 and the other for $21,636.98. Checks were then disbursed to the stockholders, including Mobley. Harmon and Mobley disagreed over the allocation of attorney fees and agreed to place 50 percent of the funds in two certificates of deposit, totaling $165,722.64, at First National Bank of Russellville, pending the outcome of the dispute. The CD’s were put in the names of Harmon’s professional association and Mobley.

In a Third Amended Complaint in this matter, an inter-pleader action was filed by Mobley and Smith in Pope County Chancery Court against Harmon and First National Bank of Russellville. The bank, in its answer, admitted that it was holding the certificates of deposit and that the rights of Mobley and Smith on the one hand and Harmon on the other with regard to the funds needed to be declared. The bank further prayed for an order directing it to pay the funds into the registry of the court. Cross-appellants Darr, Robinson, and Hatcher intervened, claiming that if the court determined Harmon was not entitled to the amount on deposit, the funds belonged to the corporation.

The chancery court in a pre-trial order appointed the Pope County Circuit-Chancery Clerk, Juanita Barber, receiver of the funds held by the bank and further ordered that the certificates of deposit be endorsed and deposited in the bank at the highest interest rate obtainable in order to prevent waste.

Trial was held on May 22,1992. The chancery court found in favor of Harmon and concluded that a contract of employment existed between Legacy Lodges, Inc., and Harmon for a 50 percent recovery on appeal. The chancery court ordered that the entire fee be paid to Harmon and dismissed the interpleader complaint. A motion for new trial was then filed by the appellants with supporting affidavits, and it was denied by the chancery court.

I. FEE CONTRACT

For their first point, the appellants, Mobley and Smith, contest the chancery court’s Findings of Fact 7 and 15. Those findings read:

7. At the stockholder’s meeting on October 21, 1977, James Williams and Jeff Mobley were present and Mr. James Hatcher was present by Proxy. Plaintiff, Jeff Mobley, made a motion, seconded by James Williams, authorizing James Williams to contact John T. Harmon. James Williams had full authority to negotiate the terms of contract of employment and sign such contracts of employment on behalf of the corporation for the fee agreed upon by Williams and Defendant, John T. Harmon. This was evidenced by Plaintiffs Exhibit Number (8) Eight. [Minutes of the October 21, 1977 stockholders’ meeting.]
15. The Court further finds there was a contract of employment between Legacy Lodge, Inc., and John T. Harmon for fifty (50 %) percent on appeal as supported by Plaintiffs Exhibit Number (8) Eight, testimony of John T. Harmon, testimony of Ike Allen Laws, Exhibit (26) Twenty-six and Exhibit (29) Twenty-nine of the Plaintiffs.

The appellants claim that the directors of Legacy Lodges did not authorize the contract of employment between the corporation and Harmon or with John T. Harmon & Associates, P.A. They further contend, apparently in the alternative, that even if the stockholders present were acting in their capacities as directors, they curtailed the contractual ability of the president of the corporation in hiring Harmon and limited it to the “specific instance” of defending Legacy Lodges, Inc., in another matter — Pope County Circuit Court Case No. CIV-77-277 — and to filing a counterclaim against Hatcher and a cross-complaint or third-party complaint against Darr. Harmon was not retained, they insist, to prosecute the complaint against Darr and Robinson.

Bolstering the appellants’ argument is the testimony of the corporation’s president, James R. Williams, who stated that he employed the law firm of Mobley & Smith to sue Darr and Robinson, and that contract was never rescinded. He also averred that he was certain that he never signed a contract with Harmon.

The minutes of the Legacy Lodges stockholders’ meeting of October 21, 1977, however, belie the appellants’ assertions and support the chancery court findings:

A Motion was made by James Williams and seconded by Jeff Mobley authorizing and instructing Jeff Mobley to maintain contact with William F. Smith and John Harmon, attorneys for Legacy Lodge, Inc., and to insist upon as speedy a disposition as possible of a lawsuit styled Legacy Lodge, Inc. vs. Ray Lee Robinson and Robert I. Darr. Upon a vote of the stockholders the motion was approved.
A Motion was made by Jeff Mobley, and seconded by James Williams, that John Harmon be employed to represent Legacy Lodge, Inc. in the cause of action filed against Legacy Lodge, Inc., et al. same being Pope County Circuit Case No. 77-277, with full authority to represent Legacy Lodge in that cause of action and any and all future causes of action which may be filed against Legacy Lodge, Inc. of every kind and character with full authority to file any and all necessary lawsuits and counterclaims and specifically a counterclaim against James Hatcher, and a third party complaint or cross-complaint against Robert I. Darr on a[n] $8,000.00 note due Legacy Lodge, Inc. and any and all other causes of action which exist or may exist against parties whomsoever that he may deem advisable and necessary. That James Williams be authorized to contact John Harmon with full authority to negotiate the terms of contract of employment and with full authority to sign said contract of employment binding Legacy Lodge, Inc. for John Harmon’s attorney fees based upon the agreement reached between he and James Williams and with the said James Williams having full authority to commit any and all future sums which might come into Legacy Lodge’s hands from any and all sources necessary to pay the agreed fees from first money received by Legacy Lodge after the payment of Garrett, Jones and Rose’s accounting bill and the sum of $500.00 to Elizabeth P. Mobley for accounting work. (Emphasis ours.)

The first paragraph quoted indicates that, contrary to the appellants’ assertion, appellee Harmon had been employed as attorney for the corporation in the Legacy Lodges, Inc. v. Darr and Robinson matter. Further, the highlighted language in the second quoted paragraph clearly shows that Harmon was to be empowered to act as attorney well beyond the scope of Case No. 77-277.

The appellants next claim that Harmon “abandoned this agreement in 1984,” but Harmon testified that he terminated his sole proprietorship that year and that he had a written contract for the subsequent phases of litigation executed in 1987 between Legacy Lodges and his professional association.

That later contract was never produced at trial. However, Ike Allen Laws, Jr., an attorney who represented Robinson and Darr in the underlying action, testified that he actually saw the written contract between Legacy Lodges and John T. Harmon & Associates, P.A., when he met with Mobley at the courthouse to pay off the judgment in 1988. He insisted on seeing the corporation’s contract with Harmon because, he said, “that was a pretty big fee and as a result, my client was going to be paying thirty percent of it.” Laws described the document as a “standard . . . Arkansas trial lawyers’ contract” that provided for a 50 percent fee for Harmon’s professional association in the event of a successful appeal. The contract, he stated, was in Mobley’s possession. Mobley also told him, Laws stated, that Harmon was owed 50 percent as an attorney’s fee.

Although this court reviews chancery cases de novo, we will not set aside a chancellor’s findings of fact unless they are clearly erroneous. Ark. R. Civ. P. 52(a); Nunley v. Orsburn, 312 Ark. 147, 847 S.W.2d 702 (1993); Dudley v. Little River County, 305 Ark. 102, 805 S.W.2d 645 (1991). This oft-repeated principle recognizes the chancellor’s superior position to assess the credibility of witnesses. Medalist Forming Systems, Inc. v. Malvern National Bank, 309 Ark. 561, 832 S.W.2d 228 (1992).

Credibility lies at the heart of this appeal. The contract in question was not produced at court. Two mutually inconsistent accounts were presented instead: Mobley claimed that no contract existed; Harmon claimed that there was a written contract and Laws claimed that he had seen it. The minutes of the October 21, 1977 stockholders’ meeting clearly indicate that a contract was to be formed between Legacy Lodges and Harmon for the existing cause of action, as Harmon asserts.

We cannot say, based on the evidence adduced above, that the findings of the chancery court were clearly erroneous in this instance. On the contrary, we hold that they were supported by substantial evidence.

II. EXISTENCE OF WRITTEN CONTRACT

Nor can we say that the chancery court’s Finding of Fact 11 was clearly erroneous. There, the chancellor found that Mobley had shown attorney Ike Allen Laws the contract between Harmon’s professional association and Legacy Lodges, and based on seeing that contract, Laws delivered two checks made payable to Legacy Lodges and to Harmon to satisfy the obligation of Robinson and Darr.

This issue has been largely addressed in the previous point. Again, the crux of this matter is a credibility question entrusted to the chancellor. Laws’s testimony was contradicted by Mobley and corporation president James R. Williams, who stated flatly at trial that “I am certain that I never signed a contract with Mr. Harmon.. . .” In an affidavit in support of a post-trial motion to reconsider the judgment or grant a new trial, Williams again denied that he ever signed a contract with Harmon. The chancery court clearly found Laws and Harmon to be more credible.

Harmon did represent Legacy Lodges up through the appeal in Darr v. Legacy Lodges, Inc. An attorney who appears in court is presumed to be authorized to represent the client. Potter v. First National Bank, 292 Ark. 74, 728 S.W.2d 167 (1987); Pender v. McKee, 266 Ark. 18, 582 S.W.2d 929 (1979). Even if Harmon merely “guessed” he was re-employed in 1987, Legacy Lodges provided him with every reason to make that assumption. There is not a shred of evidence that Legacy Lodges did not want Harmon to proceed with the case in 1987; indeed, the indications are that Harmon was urged to forge ahead with the trial of the matter and then to protect the corporation’s interest in the appeal.

The appellants further contend that Harmon made “binding admissions” in which he disavowed any interest — personal, financial, or legal — in the lawsuit, as opposed to his professional association, and that he, accordingly, is not entitled to the fee. This argument was not presented to the chancery court in this form, and we will not consider arguments raised for the first time on appeal or where a ruling from the trial court has not been obtained. See Viking Insurance Co. v. Jester, 310 Ark. 317, 836 S.W.2d 371 (1992); Gatlin v. Gatlin, 306 Ark. 146, 811 S.W.2d 761 (1991).

III. CONFLICT OF INTEREST

The appellants next contest Finding of Fact 13, which reads:

13. From the testimony, it is clear to the Court that Plaintiff, Jeff Mobley, had a conflict of interest in the Chancery Court case as he was an attorney, stockholder and director of Legacy Lodge, Inc. The question has been addressed by the Arkansas Supreme Court on several occasions. In Boling Administration (sic) vs. Gibson, 266 Ark. 310, 584 S.W.2d 14 (1979), the Court held thatwhen an attorney is called as a witness during a trial, he is part of it, and held it was improper for an attorney to testify on the merits of the case when an associate continued in the trial. The Court stated that an attorney must decide to be an attorney or a witness. That ruling was re-affirmed in Enzor vs. State, 262 Ark. 545, [559] S.W.2d [148] (1977). Therefore, it is clear from the evidence that Plaintiff, Jeff Mobley, was a witness, and that Plaintiff, William Smith, is also disqualified because Mr. Mobley and Mr. Smith are partners in the practice of law.

The appellants urge that the chancery court committed error in making this finding because the court had disallowed the introduction of portions of the Arkansas Rules of Professional Conduct or the Model Rules of Professional Conduct into evidence at trial. Yet, the appellants contend, the court based its decision on those same Professional Rules.

We note, initially, that nowhere in Finding of Fact 13 is there mention of the Rules of Professional Conduct. Instead, the chancery court referred to Arkansas case law to the effect that there is an inconsistency in the function 1) of an advocate to advance or argue the cause of another and 2) of a witness to state facts objectively. Bolingv. Gibson, supra. Both cases cited by the court expressed strong disapproval of an attorney’s testifying in an action in which he is an advocate. “An attorney who is to testify in an action,” we said in Enzor v. State, supra, “should withdraw from the litigation.” 262 Ark. at 551, 559 S.W.2d at 151.

At trial, the chancery court also discussed its understanding of Aetna Casualty & Surety Co. v. Broadway Arms Corp., 281 Ark. 128, 664 S.W.2d 463 (1983). In that case, we relied on the American Bar Association Code of Professional Responsibility (then operative) for the view that, in the instance of a contingent fee agreement, an attorney “may testify and also share in the fee, provided he completely withdraws from participation in the case other than as a witness.” 281 Ark. at 137, 664 S.W.2d at 467. We also reiterated that a testifying attorney becomes both “advocate and witness, one of which requires the lawyer to be partisan and the other of which requires him to be factual.” 281 Ark. at 136, 664 S.W.2d at 467; quoting Rushton v. First National Bank of Magnolia, 244 Ark. 503, 426 S.W.2d 378 (1968). We then said that when an attorney fills both roles, it robs the trial of the appearance of fairness.

In sum, while the decisions of this court relied upon by the chancery court may have invoked Rules of Professional Conduct, the Rules were not the basis for the court’s decision. Rather, the chancery court predicated its conclusion on the holdings in our case law. The appellants’ argument is without merit.

IV. KNOWLEDGE OF POTENTIAL CONFLICT

The chancery court’s Finding of Fact 14 states:

14. That Plaintiff, Jeff Mobley, knew that he was a witness prior to John T. Harmon’s filing of the Legacy Lodge, Inc. lawsuit. Therefore, Plaintiff, Jeff Mobley, can not participate in the contingent fee arrangement nor could his associate, plaintiff, William Smith. In Aetna Casualty & Surety Co. vs. Broadway Arms Corp., 281 Ark. 128, 664 S.W.2d 463 (1984) (sic), ... the Court, with a split decision, allowed an attorney ... to receive a contingent [fee.] . . . Because in that case, the witness, an attorney, testified that he did not know that he would be a witness until after the agreement was made. Even then, the Court stated that the attorney must completely withdraw from participation other than as a witness. In this case, Plaintiff, Jeff Mobley, continued to participate behind the scenes as previously set forth in the findings of the Court.

In appellant William F. Smith’s testimony, the following concession appears:

I was employed by Legacy Lodge as their attorney to represent them.. . . Mr. Mobley and I discussed the claim at case (sic). We decided that there was a potential, and I quote, potential, that Mr. Mobley could be called as a witness. . . . There would be the problem of Mr. Mobley trying the case and being a witness also. This presented a presentation problem as far as I was concerned. It presented a presentation problem for me being his law partner. . . . We discussed this, discussed who we would might want to associate with us in this case. We had had associations with Mr. Harmon in the past, we had worked on cases in the past. He suggested Mr. Harmon. It was Mr. Mobley that suggested him. We contacted Mr. Harmon and he came to Russellville, Arkansas.

It was obvious to Smith and Mobley in 1977, prior to the corporation’s hiring of Harmon, that at the very least a “potential” existed for Mobley to be called as a witness and that this presented a problem for the firm’s representation.

As the chancellor noted, this situation is governed by Aetna Casualty & Surety Co. v. Broadway Arms Corp., supra. That case held that it is permissible for an attorney to testify and share in the contingent fee where he completely withdraws from all other participation in the case and where the contingent fee agreement “was entered into prior to the time the attorney had any idea he would be a witness.” 281 Ark. at 135, 664 S.W.2d at 467. (Emphasis added.) That is not the situation in the case before us. Mobley and Smith clearly were aware of the potential for Mobley’s conflicting roles, and this was the catalyst for Harmon’s being hired. Moreover, Mobley did not completely withdraw. He continued to be involved significantly in the legal representation by assisting Harmon informally. The chancery court’s finding was not clearly erroneous on this point.

V. QUANTUM MERUIT

At trial, Mobley stated that Harmon, Smith, and he had orally agreed in 1977 to split any attorney’s fee by thirds, with one portion going to Smith, another to Harmon, and the third to Mobley himself. On this basis, the appellants assert that Harmon should have been awarded a quantum meruit or one-third fee rather than the entire amount. The argument is not convincing because the question of a one-third oral agreement was disputed by Harmon and because, even if it had been made, it was superseded by the subsequent, written contract in 1988 whose existence was testified to by Harmon and Laws.

The other issues raised are rendered moot by this opinion.

Affirmed.

Hays, J., not participating.


author: Per Curiam.

text:
    Rhonda KIMBLE v. Robert GRAY, Sr.
    92-1486
    853 S.W.2d 890
    Supreme Court of Arkansas
    Opinion delivered June 1, 1991

      Kimberly D. Burnette, Child Support Enforcement Unit, for petitioner.

      Dale E. Adams, for respondent.
   Per Curiam.

We granted Rhonda Kimble’s petition for review of the court of appeals’ per curiam granting dismissal of her appeal. Appellee, now respondent, Robert Gray, Sr., previously asked the court of appeals to determine that Kimble had failed to file a timely appeal. The court of appeals found Kimble had filed her notice of appeal one day too early, and under the terms of Rule 4(c) of the Rules of Appellate Procedure, the court held Kimble’s notice of appeal had no effect. The court of appeals’ per curiam, Kimble v. Gray, Sr., 40 Ark. App. 196, 842 S.W.2d 473 (1992), succinctly sets out that court’s authority and reasons for dismissing Kimble’s appeal. Because we agree with the court of appeals’ per curiam and ruling, we merely affirm its decision.


author: Steele Hays, Justice.

text:
    John HOGAN v. Robert HOGAN and Betty DeJarnett
    92-1347
    855 S.W.2d 905
    Supreme Court of Arkansas
    Opinion delivered June 7, 1993
    [Rehearing denied July 12, 1993.]

      Steven Napper, Ltd., by: Trish Henry, for appellant.

      Joyce Kinkead, for appellee.
   Steele Hays, Justice.

John Hogan, appellant, is the eighty-nine year old father of the appellees, Robert Hogan and Betty DeJarnett. The three were joint tenants of a $99,402 Certificate of Deposit (CD) purchased by John Hogan with funds allegedly belonging entirely to him.

On January 15,1992, Robert Hogan presented the CD to the bank and redeemed it for a check payable to Robert Hogan or Betty DeJarnett. John Hogan was informed of this action on February 8,1992, when he went to the bank to renew the CD and learned it had been withdrawn by his son.

John Hogan promptly filed this suit against Robert and Betty, alleging that:

1) The CD had been removed by Robert from John’s home, at some time when John was not at home and was converted without his knowledge or consent;
2) The CD had been cashed by Robert and demand had been made on both Robert and Betty for return of the funds but the request was ignored or refused;
3) That John had placed the names of his children on the CD so they would have survivorship rights to the funds in the event of his death and there was an oral agreement between John and his children that their names were on the instrument only so they would have survivorship rights and the children would have no right to obtain the funds while their father was still alive;
4) That John’s livelihood was dependent on the monthly interest that was generated from the CD and he was no longer in receipt of those monthly payments.

Appellees answered and moved for summary judgment on the premise that Arkansas law provides that any joint tenant can redeem a CD and whoever redeems it is entitled to the entire amount. The chancellor agreed and granted summary judgment on the basis of Ark. Code Ann. § 23-32-1005 (1987), Nall v. Duff, 305 Ark. 5, 805 S.W.2d 63 (1991) and Hall v. Superior Federal Bank, 303 Ark. 125, 794 S.W.2d 611 (1990).

John Hogan appeals from that order, contending, correctly we think, that the trial court misinterpreted the law.

The relevant portions of the statute in question, § 23-32-1005 are:

Checking accounts and savings accounts may be opened and certificates of deposit may be issued by any banking institution, or federally or state-chartered savings and loan association, in the names of two (2) or more persons, either minor, adult, or a combination of minor and adult. Checking accounts, savings accounts, and certificates of deposit shall be held and payable as follows:
(1)(A) Unless a written designation to the contrary is made to the banking institution or federally or state-chartered savings and loan association, when a deposit has been made or a certificate of deposit purchased in the names of two (2) or more persons and in the form to be paid to any of the persons so named, or the survivors of them, the deposit or certificate of deposit and any additions thereto made by any of the persons named in the account shall become the property of those persons as joint tenants with right of survivorship.
(B) The deposit or certificate of deposit, together with all interest thereon, shall be held for the exclusive use of the persons so named and may be paid to any of those persons or to the survivors after the death of any of those persons. The payment shall be a valid and sufficient release and discharge of the bank or federally or state-chartered savings and loan association for all payments made on account of the deposit or certificate of deposit; [Our emphasis].
(2) (A) If the person opening the account or purchasing the certificate of deposit designates in writing to the banking institution or federally or state-chartered savings and loan association that the account or the certificate of deposit is to be held in “joint tenancy” or in “joint tenancy with right of survivorship,” or that the account or the certificate of deposit is to be held in “joint tenancy” or the account or certificate of deposit shall be payable to the survivor or survivors of the persons named in the account or certificate of deposit, then the account or certificate of deposit and all additions thereto shall be the property of those persons as joint tenants with right of survivorship.
(B) The account or certificate of deposit may be paid to or on the order of any one (1) of those persons during their lifetime unless a contrary written designation is given to the banking institution or federally or state-chartered savings and loan association, or to or on the order of any one (1) of the survivors of them after the death of any one (1) or more of them.
(C) The opening of the account or the purchase of the certificate of deposit in this form shall be conclusive evidence in any action or proceeding to which either the banking institution or federally or state-chartered savings and loan association or the surviving party is a party of the intention of all of the parties to the account or certificate of deposit to vest title to the account or certificate of deposit, and the additions thereto, in such survivor.
(D) The payment shall be a valid and sufficient release of the bank or federally or state-chartered savings and loan association for all payments made on account of the deposit or certificate of deposit. . . .

The trial court in its order granting summary judgment stated the following:

Conclusions of Law

Arkansas Code Ann. § 23-32-1005(2)(C) (1987) declares that the purchase of a Certificate of Deposit as joint tenants with right of survivorship is conclusive evidence of the intention of all of the parties.
The Arkansas Supreme Court in Hall v. Superior Federal Bank, 303 Ark. 125, 794 S.W.2d 611 (1990) held that if Ark. Code Ann. § 23-32-1005(2)(C) governs, extrinsic evidence of intent is not admissible.
Although prior case law indicated that the predecessor of Ark. Code Ann. § 23-32-1005 was passed only for the protection of financial institutions, that is not the case under the current Code. . . . And that Robert Hogan had the right to cash the Certificate of Deposits and Defendants Robert Hogan and Betty DeJarnett have the right to possess the entire amount of the proceeds from the Certificate of Deposits, to the exclusion ofplaintiff John Hogan. Hall v. Superior Federal Bank, supra; Nall v. Duff, 305 Ark. 5, 805 S.W.2d 63 (1991). [Our emphasis.]

The trial court’s comments at the hearing make its interpretation of the statute clear:

[I]n Nall v. Duff, 305 Ark. 5, the Supreme Court went further than the Hall case [Hall v. Superior Bank] and stated that joint tenants could withdraw the funds and that, once they did withdraw the funds, that they were their property, conclusive evidence by the statute that they are their property.

We must agree with appellant that the trial court has misinterpreted the statute and our cases dealing with it.

There is no question that under § 23-32-1005, anyjoint tenant has the right to withdraw the entire amount in a joint tenancy account. Section 23-32-1005(1 )(B) and (2)(B). Those provisions, however, provide only that the funds may be paid to the joint tenant. They do not determine ownership to the exclusion of other joint tenants.

The other pertinent section — § 23-32-1005(2)(C) — recites that when the provisions of the statute are complied with, such compliance will be conclusive evidence

... in any action or proceeding to which either the banking institution or federally or stated-chartered savings and loan association or the surviving party is a party, of the intention of all of the parties to the account or CD, to vest title to the account or CD, and the additions thereto, in such survivor.

This section recites that compliance with the statute will be conclusive evidence of the parties’ intentions that the surviving party is entitled to the funds. It does not say that compliance with the statute conclusively vests ownership of the proceeds of the account or CD in whoever happens to withdraw it. The surviving parties in any given case would be those parties remaining after one or more joint tenants had died. This section does not address the rights of a joint tenant who merely withdraws the funds, nor does it deal with the rights of joint tenants among themselves.

Sections 23-32-1005(l)(A) and (2)(A), on the other hand, do address ownership among the joint tenants. Both sections provide that if the parties opening the account or CD have complied with the statute in one of two ways, it will be considered a joint account and the money deposited therein “shall be the property of those persons as joint tenants with right of survivorship”. In the case at bar the parties agree the statute was complied with and the CD purchased as a joint tenancy with right of survivorship. Therefore under section (1)(A) or (2)(A), the CD was the property of all parties as joint tenants.

As to rights in the property as among joint tenants, there is nothing in § 23-32-1005 that governs that issue, nor do we find it elsewhere in our statutes. Therefore it is necessary to turn to other sources for guidance.

This question has not been before this court previously, though it was addressed by the Court of Appeals in Savage v. McCain, 21 Ark. App. 50, 728 S.W.2d 203 (1987). There, one joint tenant (Savage) had withdrawn all the funds and refused to account to the other joint tenant (McCain). The parties agreed that Savage had a right to withdraw the funds under Ark. Code Ann. § 23-32-1005 (1987) (formerly § 67-552); the disagreement was over Savage’s right to keep the funds to the exclusion of McCain. The Court of Appeals did not resolve the dispute by addressing the rights of joint tenants as among themselves. Rather, it found that a “peculiar relationship of mutual trust and confidence” existed between the joint tenants and that McCain was intended to have a beneficial interest in the funds. On that basis it upheld the constructive trust imposed by the chancellor.

Looking to other jurisdictions we find that in similar situations the courts have reached the same result as in Savage, but have relied on the law of joint tenancy, and the rule is quite clear:

Even though a joint tenant may withdraw the entire fund, one who does withdraw funds in excess of his moiety is liable to the other joint tenant for the excess so withdrawn.

Leffew v. Mayes, 685 S.W.2d 288 (Tenn. App. 1984). To the same effect see Wiggins v. Parson, 446 So.2d 169 (Fla. App. 5 Dist. 1984); McCaulliffe v. Wilson, 41 NC 117, 254 S.E.2d 547 (1979); Bricker v. Krimer, 13 N.Y.2d 122, 241 N.Y.S.2d 413, 191 N.E.2d 795 (1963); Austin v. Summers, 237 S.C. 613, 118 S.E.2d 684 (1961) and Carroll v. Hahn, 498 S.W.2d 602 (Mo. Ct. App. 1973). And generally in accord see 8 ULA Unif. Prob. Code, §§ 6-102, 6-103 and 6-104 (1983).

While our Code does not define substantive rights among joint tenants, it recognizes the common law rights of joint tenants, for it provides for an accounting between them. Ark. Code Ann. § 18-60-101 (1987) states:

(b) Joint tenants, tenants in common, and coparceners in any real or personal estate, may maintain civil actions against their covenants who receive as bailiffs more than their due proportion of the benefits of the estate. [Our emphasis.]

The trial court in this case relied on Nall v. Duff, supra, to provide that mere withdrawal of funds by one joint tenant established complete ownership in such joint tenant to the exclusion of any other joint tenants. That was an incorrect reading. Rather, Nall addressed whether the withdrawal of funds by one joint tenant terminated any rights she had to those funds. We held it did not, and by way of support pointed to § 23-32-1005(1)(B) and (2)(B), which provide for payment of the funds to any joint tenant who seeks to withdraw them. Linder Nall, those sections established ownership rights in joint tenants, one of which was the right to withdraw funds — one of the incidents of ownership. We did not decide, nor did we address, whether by withdrawing funds in joint tenancy one joint tenant acquired ownership to the exclusion of any other joint tenant.

For the reasons stated, the order of summary judgment is reversed and the case is remanded for a trial on the merits, including a determination as to the imposition of a constructive trust and to apportion the proceeds in accordance with intentions of the parties. See generally Savage v. McCain, supra; 8 ULA, Unif. Prob. Code, §§ 6-103 and 6-104 (1983), and Commentary thereto.

Reversed and remanded for further proceeding consistent with this opinion.