author:
David Newbern, Justice.
      Steele Hays, Justice,

text:
    AMERICAN NATIONAL PROPERTY AND CASUALTY COMPANY v. Oma Gillean ELLIS
    93-643
    868 S.W.2d 469
    Supreme Court of Arkansas
    Opinion delivered January 18, 1994

      Huckabay, Munson, Rowlett & Tilley, P.A., by: Bruce Mun-son, for appellant.

      Dodds, Kidd, Ryan & Moore, by: Robert T. James, for appellee.
   David Newbern, Justice.

In Lucky v. Equity Mutual Ins. Co., 259 Ark. 846, 537 S.W.2d 160 (1976), we held that when the parties to an insurance contract agree to a policy endorsement which has the effect of substituting coverage of one automobile for that of another the transaction constitutes new insurance, “delivered or issued for delivery in this State.” The effect of the decision was to require insurers, pursuant to a statute now codified as Ark. Code Ann. § 23-89-403(a) (Repl. 1992), to offer uninsured motorist coverage to the insured upon the event of substituting vehicles even though the insured had previously rejected such coverage.

At the time the Lucky case was decided, subsection (b) of §23-89-403 provided an insured could reject the uninsured motorist coverage the insurer was required to offer pursuant to subsection (a). In the legislative session following the decision in the Lucky case, the General Assembly added these words to subsection (b), “and this rejection shall continue until withdrawn in writing by the insured.” Act 532 of 1977. The question now before us is whether the addition of those words to the statute changed the law as we espoused it in the Lucky case. We hold it did not.

Beginning in 1986, American National Property and Casualty Company (American), the appellant, insured a vehicle belonging to Orna Gillean Ellis, the appellee. The original policy issued to her, effective 11.-11-86, covered a 1976 Ford Granada, and it included uninsured motorist coverage. The renewal of that policy, effective 5-11-87, was identical except that additional coverage for incidents involving underinsured motorists was added, effective 5-12-87. Ms. Ellis thereafter signed a document waiving both uninsured and underinsured motorist coverage. An amended declaration, effective 11-11-87, reflects the change in coverage and the extension of the policy to 5-11-88.

Nothing in the record before us shows that there was any coverage for the period from 5-11-88 to 11-11-88. There is a premium notice which indicates payment was due 5-11-88, but nothing in the record shows that the premium was paid or continuation of coverage was otherwise obtained.

The next declaration in the record covers the period from 11-11-88 to 5-11-89 and shows a change in vehicles to a 1980 Mercury Zephyr. The final declaration, covering the period from 5-11-89 to 11-11-89, made no change in coverage. The policy number was the same on each declaration.

Ms. Ellis was involved in an accident with an uninsured motorist on 10-29-89. Her claim for uninsured motorist benefits was denied on the basis of her 1987 rejection of the coverage. She sought a declaratory judgment that the substitution of vehicles on the policy amounted to “delivery” of a new policy and therefore should have been accompanied by an opportunity for her to accept or reject uninsured motorist coverage. After discovery, both parties moved for summary judgment. The Chancellor concluded coverage of the substituted vehicle was a new contract requiring American to offer uninsured motorist coverage again. Absent such an offer and rejection, coverage was provided because § 23-89-403 requires it unless it has been rejected by the insured.

The statute provides:

23-89-403. Bodily injury coverage required.
(a) No automobile liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be delivered or issued for delivery in this state with respect to any motor vehicle registered or principally garaged in this state unless coverage is provided therein or supplemental thereto and is not less than limits described in 27-19-605, under provisions filed with and approved by the Insurance Commissioner, for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom.
(b) However, the coverage required under this section shall not be applicable where any insured named in the policy shall reject the coverage, and this rejection shall continue until withdrawn in writing by the insured.

American argues the language added to subsection (b) by Act 532 was intended to change the law by effectively overruling our decision in the Lucky case.

The Chancellor disagreed and found the amendment did not change the law. He was correct. Our decision in the Lucky case was that the substitution of a vehicle constituted issuance of or delivery of an insurance policy. As the Chancellor put it, although he did not rely on the Lucky decision, a new contract is entered when a new declaration occurs with respect to a substituted vehicle. If the General Assembly intended to, in effect, overrule that decision, it failed to do so because it said nothing which affects the holding of the case. We are certain the General Assembly did not intend that rejection of uninsured motorist coverage in one insurance contract be binding in a subsequent one.

Affirmed.

Hays, J., dissents.

Steele Hays, Justice,

dissenting. When the case of Lucky v. Equity Mutual Ins. Co., 259 Ark. 846, 537 S.W.2d 160 (1976) was decided, Section 1 of Act 464 of 1965 provided in effect that no policy of automobile liability insurance would be issued in Arkansas unless it provided coverage against losses inflicted by uninsured motorists, “provided, however, that [such] coverage . . . shall not be applicable where any insured named in the policy shall reject the coverage.”

Soon after the decision in Lucky v. Equity Mutual Ins. Co., supra, the legislature amended Act 464 by adding the following language to Section 1 “and such rejection shall continue until withdrawn in writing by the insured.”

Since we must presume the legislature had Lucky v. Equity Mutual Ins. Co. in mind when it adopted Act 532 [Merchants’ Transfer & Warehouse Co. v. Gates, 180 Ark. 96, 21 S.W.2d 406 (1929)], and to have acted with reference thereto [Lumberman’s Mutual Casualty Co. v. Moses, 224 Ark. 67, 271 S.W.2d 780 (1954)], it seems implausible to further assume its intent was not to correct what it deemed an erroneous construction of Act 464. If there is an intent consistent with the holding in Lucky, it doesn’t come readily to mind. On that basis I believe the appellant was entitled to summary judgment.


source: Caselaw Access Project

author: David Newbern, Justice. Steele Hays, Justice,

license: Public Domain

text:
    Billie FAUSETT v. Rodney HOST and Sheila Host
    93-470
    868 S.W.2d 472
    Arkansas Supreme Court
    Opinion delivered January 18, 1994

      Jerry Patterson, for petitioner.

      Phillip A. McGough, P.A., for respondents.
   David Newbern, Justice.

The question in this case is whether a writ of prohibition may issue to prevent a trial court from asserting in personam jurisdiction. We hold that, when a trial court has made a determination that a person’s contacts with Arkansas are sufficient to satisfy the minimum contacts requirement of International Shoe Co. v. Washington, 326 U.S. 310 (1945), and Ark. Code Ann. § 16-4-101 C.l.(a) (Supp. 1993), the proper manner of challenging the decision is by appeal and not by a petition for a writ of prohibition.

Rodney and Sheila Host, the respondents, live in North Little Rock. They filed a complaint in Pulaski Circuit Court against Billie Fausett, the petitioner, who is a Missouri resident. The complaint alleged conversion and breach of a lease with option to purchase agreement. They claim Ms. Fausett improperly ousted them from the property which was the subject of the agreement and converted funds the Hosts had paid to her pursuant to the agreement. Ms. Fausett was served with process in Missouri. She moved to dismiss because the Trial Court lacked jurisdiction of her. A hearing was held, and the motion was denied.

At the hearing Mr. Host testified he was interested in buying a business in Branson, Missouri. He found a real estate agent by consulting a Branson newspaper. The agent he selected lives in Oak Grove, Arkansas, but does business in Branson. The agent led him to Billie Fausett, owner of a donut shop in Branson which was, apparently, for sale. The transaction then proceeded by telephone and by mail. There were two phone calls between Mr. Host and Ms. Fausett made while Mr. Host was in North Little Rock, and Ms. Fausett was at the home of her mother in Marshall, Arkansas. In one of them Ms. Fausett discussed the transaction. Mr. Host testified that Ms. Fausett had told him her mother, who lives in Marshall, is her accountant.

A contract form was sent to the Hosts. They signed an offer at their home in North Little Rock. It was not accepted. Another contract was mailed to them, they again executed it in North Little Rock, and it was accepted. Mr. Host testified that his sister lived in Branson and ran the business for them for some eight months. The Hosts also presented documentary evidence having to do with Ms. Fausett’s use of Arkansas suppliers of goods to the donut shop. We regard that evidence as irrelevant to the transaction at hand.

In his remarks preceding his decision to deny the motion to dismiss, the Trial Court acknowledged that our decision in CDI Contractors, Inc. v. Goff Steel Erectors, Inc., 301 Ark. 311, 783 S.W.2d 846 (1990), stated that use of interstate mail, telephone, railway, and banking facilities is insufficient, standing alone, to satisfy due process in asserting long-arm jurisdiction of a nonresident corporation. He then, however, referred to SD Leasing, Inc. v. Al Spain & Assoc., Inc., 277 Ark. 178, 640 S.W.2d 451 (1982), noting that it seemed important that the contract was signed (at least by one of the parties) in Arkansas. In his order, the Trial Court stated that the contacts with Arkansas were sufficient to satisfy the requirements set out in International Shoe Co. v. Washington, supra.

In response to Ms. Fausett’s petition for a writ of prohibition, the Hosts cite Wisconsin Brick and Block Corp. v. Cole, Judge, 274 Ark. 121, 622 S.W.2d 192 (1981). As in the case now before us, the question there was whether the claim arose out of the defendant’s “[transacting any business in this state.” Ark. Code Ann. § 16-4-101 C. l.(a) (Supp. 1993). We noted that “The purpose of this section of the statute is to permit courts to exercise the maximum personal jurisdiction allowable by due process. . . .” Then we quoted Hawes Firearm Co. v. Roberts, 263 Ark. 510, 565 S.W.2d 620 (1978), as follows:

A non-resident defendant filing a motion to dismiss or quash [on grounds that there are not sufficient contacts within the state] has the burden of going forward and offering proof to sustain the allegations of the motion. If the motion is denied, this does not mean that the plaintiff is relieved from establishing jurisdiction; it merely means that at this point in the proceedings a prima facie case of jurisdiction sufficient to take the cause to trial has been made.

We concluded our opinion in the Wisconsin Brick and Block Corp. case as follows:

Whether the “minimum contacts” test has been satisfied is a question of fact. In cases where jurisdiction depends upon the establishment of facts, the issue of jurisdiction must be decided by the trial court, and even if that decision should be wrong, we correct that error on appeal and not on prohibition. Robinson v. Means, Judge, 192 Ark. 816, 95 S.W.2d 98 (1936).

In her reply brief, Ms. Fausett responds to the Hosts’ citation of the Wisconsin Brick and Block Corp. case by saying the nonresident defendant in that case “had purchased brick products from [the plaintiff]... the resident seller, for 20 years, thus flunking the threshold question” of minimum contacts. She also says she has met the burden of the Hawes Firearm Co. case by showing at a hearing that there were no Arkansas contacts with respect to her participation in the transaction at hand. Both of those assertions have to do with facts which must be determined in the process of deciding whether there is jurisdiction of the person. They do not answer the holding in the Wisconsin Brick and Block Corp. case.

In Harris, Distributors, Inc. v. Marlin, Judge, 220 Ark. 621, 249 S.W.2d 3 (1952), we discussed the role of the writ of prohibition: “Of course the writ has in fact a well established place in our procedure. In the usual case it issued when the record shows without dispute that the trial court lacks jurisdiction of the person or of the subject matter.” The general reference to “jurisdiction of the person” as a basis for a writ of prohibition gives us pause. The case was not one which dealt with lack of jurisdiction of the person, however, and the only citation given for the obiter dictum with which we are concerned was Gainsburg v. Dodge, 193 Ark. 473, 101 S.W.2d 178 (1937). There it was held, based on a statute in effect at the time, that a nonresident defendant could not be subjected to a personal judgment (injunction) on the basis of constructive service of process.

There was a time and circumstance when the writ of prohibition was the only adequate remedy for one challenging a court’s assertion of in personam jurisdiction. The time, encompassing 1937 when the Gainsburg case was decided, was prior to the adoption of the Arkansas Rules of Civil Procedure, and the circumstance was when there had been no service of process, or faulty service, upon the defendant. We explained the situation in Order of Ry. Conductors of America v. Bandy, 177 Ark. 694, 8 S.W.2d 448 (1928) [overruled in, Anheuser-Busch, Inc. v. Manion, 193 Ark. 405, 100 S.W.2d 672 (1937)]. Finnegan sued the Order of Railway Conductors of America (Order), which was essentially a mutual benefit organization, alleging it had failed to pay benefits due to him as the result of an injury he sustained while working as a railroad conductor. The Order was not a resident of Arkansas. The complaint was served on the Arkansas Insurance Commissioner. The Order entered a “special appearance” to object to jurisdiction, and the objection was overruled. The Order sought a writ of prohibition. The writ was granted. Chief Justice Hart wrote:

Where the court has jurisdiction over the subject matter, and the question of its jurisdiction of the person turns upon some fact to be determined by the court, its decision that it has jurisdiction, if wrong, is an error, and prohibition is not the proper remedy. [Citation omitted.] But that condition is not the status here. The question of jurisdiction in the case at bar does not turn upon the sufficiency or insufficiency of the service of process, and the fact that the circuit court held it to be sufficient does not avail. A different rule prevails where there is an entire want of service or where, upon the face of the record, it is shown that there was no service and that none could be acquired. In the case at bar the jurisdiction or lack of jurisdiction of the circuit court did not depend upon facts which are not made a matter of record in the proceedings in that court. It appears from the face of the record in the case in the circuit court that it was not authorized to proceed, and it affirmatively appears from the face of the record that no service of process was had upon the defendants and that they did not enter their appearance.

The opinion then discussed the propriety of the writ of prohibition and pointed out that if the Order had appealed from the denial of its motion to quash the service of process it would have been considered to have recognized the court’s jurisdiction and thus entered a general appearance. There was thus a “Catch-22” situation which does not exist today. We recognized the hyper-technicality and unfairness of the rule in the Anheuser-Busch, Inc. case.

The last vestiges of the distinction between “special appearance” and “general appearance” were abolished with the adoption of Ark. R. Civ. P. 12(b) which provides for raising various defenses, including “lack of jurisdiction over the person,” by motion or in a responsive pleading at the option of the pleader. The Rule then provides, “No defense or objection is waived by being joined with one or more other defenses or objections in a responsive pleading.” Both this Court and the Arkansas Court of Appeals have recognized and said clearly that the distinction between special appearance and general appearance no longer exists. Arkansas Game and Fish Comm. v. Lindsey, 292 Ark. 314, 730 S.W.2d 474 (1987); Searcy Steel Co. v. Merchants Bank of Jonesboro, 19 Ark. App. 220, 719 S.W.2d 277 (1986). See also Reporter’s Note 5. to Ark. R. Civ. R 12. The fact that taking an appeal may at one time have been considered to have amounted to making a “general appearance” thus has historical significance only.

We find no modern case in which a writ of prohibition has been issued by this Court to prevent a trial court from proceeding after having made a determination, based on § 16-4-101 C.l.(a)., that a party is within its jurisdiction. There are, however, cases in which we have discussed related issues.

In Howard v. County Court of Craighead County, 278 Ark. 117, 644 S.W.2d 256 (1983), a mother brought a paternity action against a nonresident of Arkansas in the County Court. The defendant moved to dismiss for' lack of in personam jurisdiction. The motion was denied in the County Court. The defendant’s petition for a writ of prohibition in the Circuit Court was denied, and he appealed. We treated the appeal as turning on the adequacy of the complaint. We reversed on the basis that the complaint had failed to state facts bringing it within the broad provision of Act 119 of 1963, now codified as Ark. Code Ann. § 16-58-120 (1987). The defendant did not seek a writ of prohibition in this Court. The case came to this Court on appeal, and we did not discuss the propriety of prohibition.

We are aware of two cases in which we have actually granted writs prohibiting a trial court from proceeding against a person of whom it lacked jurisdiction for reasons other than failure of service of process. In Gillioz v. Kincannon, Judge, 213 Ark. 1010, 214 S.W.2d 212 (1948), the jurisdiction asserted by the Trial Court was on the basis of a statute purporting to grant such jurisdiction retroactively. We held that the retroactivity clause in the statute was invalid and granted the writ with no discussion of the propriety of the writ as opposed to appeal.

In Malone & Hyde, Inc. v. Chisley, 308 Ark. 308, 825 S.W.2d 558 (1992), prohibition was sought to prevent the Trial Court from proceeding with a case which had been brought by a resident plaintiff against a nonresident defendant corporation. We followed the Howard case, holding that the complaint was deficient because it failed to allege any facts showing that the Trial Court had jurisdiction of the defendant. Unlike the Howard case, however, the Malone & Hyde, Inc. case was before us as an original action seeking a writ of prohibition. We granted the writ, and here is what we said:

A question remains concerning whether prohibition is the appropriate remedy under these facts. Where an alternative avenue for relief exists, we have been reluctant to grant the extraordinary remedy of prohibition. See, e.g., Lowery v. Steel, 215 Ark. 240, 219 S.W.2d 932 (1949). Malone & Hyde, however, does not appear to have an alternative remedy which is adequate. Certainly, forcing it to go through a trial in a court that has no jurisdiction on its face is unreasonable. This provides the petitioner only with speculative hope of success on appeal, should it not prevail before the jury.

As in the Howard case, we were evaluating the complaint to determine if it adequately stated a basis of jurisdiction of the defendant. In the case now before us, we are not concerned with the pleadings but with the decision of the Trial Court, made after holding a hearing and taking evidence relating to the question of jurisdiction of Ms. Fausett.

Our discussion in the Malone & Hyde, Inc. case about the adequacy of appeal as a remedy was not meant to suggest that any time a trial court has decided the issue of jurisdiction of the person the decision may be tested by seeking a writ of prohibition. To the extent the language we used in that case could be so interpreted, we withdraw it.

We recognize that we commonly issue writs of prohibition when venue is improperly laid and that we have said that situation is the equivalent of a lack of jurisdiction of the person. Thompson v. Dunlap, 244 Ark. 178, 424 S.W.2d 360 (1968). Cf. Mark Twain Life Ins. Corp. v. Cory, 283 Ark. 55, 670 S.W.2d 809 (1984).

We take no position on the correctness of the Trial Court’s conclusion that Ms. Fausett’s conduct amounted to transacting business in Arkansas or that she had sufficient minimum contacts to subject her to the Court’s jurisdiction. Our only decision is that, when that is the question to be determined on the basis of evidence produced or to be produced before the Trial Court, prohibition is not the proper means to challenge a decision that jurisdiction lies. Wisconsin Brick and Block Corp. v. Cole, Judge, supra.

Writ denied.

Hays, J., dissents.

Steele Hays, Justice,

dissenting. When considering whether prohibition will lie, we determine the jurisdiction of the trial court by looking to the pleadings rather than the proof. Pryor v. Hot Spring County Chancery Court, 303 Ark. 630, 799 S.W.2d 788 (1990). Furthermore, when we address the question of jurisdiction under the Arkansas long-arm statute, [Ark. Code Ann. § 16-4-101 (1987)], we first determine whether the complaint alleges sufficient facts for jurisdiction to attach. Malone & Hyde, Inc. v. Chisley, 308 Ark. 308, 825 S.W.2d 558 (1992); Howards. Craig-head, 278 Ark. 117, 644 S.W.2d 256 (1983).

This complaint falls considerably short of meeting the requirements of the long-arm statute. It fails to allege a single fact which would give rise to in personam jurisdiction over the petitioner, Billie Fausett, by the courts of this state.

The respondents, Rodney and Shelia Host, are residents of Arkansas. They went to Branson, Missouri, and seeing an ad in a Branson newspaper, contacted the agent, and eventually entered into a contract to purchase a doughnut shop from the owner, Billie F. Fausett. Ms. Fausett was a resident of Missouri. Evidently, the Hosts defaulted and Ms. Fausett reclaimed the property, whereupon the Hosts filed suit in Arkansas.

The problem is the Hosts have alleged no facts whatever connecting Ms. Fausett with the State of Arkansas which would give rise to jurisdiction. There was a hearing before the trial court, but no facts were developed giving Arkansas in personam jurisdiction. The facts noted by the trial court were that the contract of sale was signed by the plaintiffs in Arkansas, that “Arkansas Banks were involved” and that the seller’s real estate agent “lived in Arkansas.”

As to the involvement of Arkansas banks, the extent of that proof was that the Hosts simply continued to use a preexisting bank account in Arkansas in the operation of the business they had purchased in Missouri. That fact had nothing whatever to do with Ms. Fausett. Similarly, the agent’s place of residence was wholly coincidental; there was no evidence that he solicited the Hosts in Arkansas. The Hosts contacted him at his Missouri office pursuant to an ad in a Missouri newspaper. An offer may have been signed in Arkansas for the convenience of the Hosts, but the only offer in the record was not accepted and what happened subsequently is not disclosed. But these are mere details and whether viewed separately or collectively, they do not produce the “substantial connection” between the transaction and this state for jurisdiction of the person to attach. McGhee v. International Life Ins. Co., 355 U.S. 200, (1957); SD Leasing, Inc. v. Al Spain & Associates, Inc., 277 Ark. 178, 640 S.W.2d 451 (1982).

Of the several factors of the long-arm statute recognizing personam jurisdiction, the only one having any application here relates to jurisdiction “arising from the person’s . . . transacting any business in this state.” Ark. Code Ann. § 16-4-101(C)(l)(a) (1987). The plain fact is the Hosts have failed to allege or produce evidence that Mrs. Fausett has transacted any business whatever in Arkansas.

In Carter v. Wilson, 279 Ark. 58, 648 S.W.2d 472 (1983), we addressed the requirements of the due process clause:

It is thoroughly settled that under the due process clause of the Fourteenth Amendment, where a resident of another state has no contacts with Arkansas, engages in no activities that would establish a “presence” here to render him amenable to suit, he is not subject to the in personam jurisdiction of this State. Pennoyer v. Neff, 95 U.S. 714 (1877). International Shoe Co. v. Washington, 326 U.S. 310 (1945). R. Leflar, American Conflicts of Law § 19, 3rd Ed.

I believe prohibition is the appropriate remedy and a writ of prohibition should issue. Malone & Hyde Inc. v. Chisley, supra.


author: Tom Glaze, Justice.

text:
    James PARDON, Sr. and Imalene Pardon and James Pardon, Jr., Individually, and James Pardon, Jr., Administrator of the Estate of David R. Pardon, Deceased v. SOUTHERN FARM BUREAU CASUALTY INSURANCE COMPANY
    93-660
    868 S.W.2d 468
    Supreme Court of Arkansas
    Opinion delivered January 18, 1994

      Bridewell & Bridewell, by: Laurie A. Bridewell, for appellants.

      Wright, Chaney, Berry & Daniel, P.A., by: William G. Wright, for appellee.
   Tom Glaze, Justice.

On.the evening of April 22, 1989, David Pardon, Christopher Thomas, and David Smith were riding in Pardon’s 1988 Ford pickup when it overturned, killing Pardon and Thomas. At the time of the accident, the truck was insured by the appellee Southern Farm Bureau Casualty, Inc. for both liability and uninsured motorist coverages. For purposes of this litigation as it involves summary judgment, the parties agree that Thomas was driving and was uninsured at the time of this tragic accident.

Under Pardon’s liability coverage, Southern Farm was liable to pay for bodily injury for which Pardon was legally obligated to pay due to an accident arising out of the use of his truck. Pardon, however, was excluded from liability coverage since he was owner of the truck. Under the uninsured motorist provision of Pardon’s policy, Southern Farm was liable to pay for bodily injury damages to which Pardon was entitled to collect from an owner or driver of an uninsured automobile. The policy defined an uninsured automobile as one not insured by a liability policy at the time of the accident.

Pardon’s estate brought suit against Southern Farm and alleged that, because Thomas was uninsured and Pardon was excluded by the terms of his liability policy, Pardon (his estate) was entitled to recover under the uninsured motorist provision of his policy. Southern Farm answered and subsequently filed a motion for summary judgment, asserting that Pardon’s truck was an insured auto since it was covered under the liability portion of Pardon’s policy and therefore the uninsured motorist coverage provision was inapplicable. The court granted Southern Farm summary judgment, and Pardon’s estate appeals from that decision.

A similar case to the one posed here was considered by the Eighth Circuit Court of Appeals in Davis v. Bean, 804 F.2d 1018 (1986). There, Conrad Bean and his step-son, Ty Davis, were in an accident when Bean’s truck slid off an icy road. Bean was driving at the time and his truck was insured under a liability policy which included uninsured motorist coverage. Davis was excluded under the terms of Bean’s liability policy because Davis was a member of Bean’s household. Davis, however, sought recovery under the uninsured motorist provisions of Bean’s policy, claiming that the terms in those provisions excluding an owner’s and insured’s vehicle was void (1) as an illegal limitation mandated by the Arkansas uninsured motorist statute, Ark. Code Ann. § 23-89-403, 404 (1987) (previously codified as Ark. Stat. Ann. § 66-4003 (Supp. 1985), and (2) as against Arkansas public policy. The Eighth Circuit Court, adopting the district court’s reasoning, rejected Davis’s argument stating that uninsured motorist coverage should apply only where injury is the result of a collision involving the insured’s car and a car owned by an uninsured motorist, and that uninsured motorist coverage should not apply where the accident involves the insured’s car only.

We find the Bean case persuasive for several reasons. First, § 23-89-404, which provides for uninsured motorist property damage coverage, specifically indicates that such coverage applies when the collision in question involves an operator of another vehicle. See § 23-89-404(a)(2). This being statutorily contemplated, we cannot say that a policy requiring another vehicle to trigger the policy’s uninsured motorist coverage violates this state’s public policy. Second, in construing Arkansas’s uninsured motorist provisions, this court has also held that the burden of showing the “other vehicle” is uninsured is on the plaintiff. Home Ins. Co. v. Harwell, 263 Ark. 884, 568 S.W.2d 17 (1978). Clearly, this court has presumed a vehicle other than the plaintiff-insured’s must be involved when the insured is entitled to collect under uninsured motorist coverage. Third, it is also settled Arkansas law that an insurer may contract with its insured upon whatever terms the parties may agree upon which are not contrary to statute or public policy. Aetna Ins. Co. v. Smith, 263 Ark. 849, 568 S.W.2d 11 (1978). Here, under Pardon’s policy, an uninsured auto is “an auto not insured by a liability policy at the time of the accident.” Thus, because Pardon’s truck was insured by a liability policy, his uninsured motorist coverage by its very terms was inapplicable. Finally, we reiterate that the purpose of uninsured motorist coverage is to protect the insured from financially irresponsible motorists. Payne v. Farm Bureau Mutual Ins. Co. of Arkansas, Inc., 298 Ark. 540, 768 S.W.2d 543 (1989). The construction the trial court has given Pardon’s policy certainly meets this purpose.

For the reasons given above, we affirm.


author: Per Curiam:

text:
    Jimmy Don QUICK v. STATE of Arkansas
    CR 93-1397
    868 S.W.2d 488
    Supreme Court of Arkansas
    Opinion delivered January 18, 1994

      Thurman Ragar, Jr., for appellant.
    No response.
   Per Curiam:

The appellant, Jimmy Don Quick, by his attorney, has filed for a rule on the clerk.

His attorney, Thurman Ragar, admits that the failure to file the record within the prescribed time was due to a mistake on his part.

We hold that such an error, admittedly made by the attorney for a criminal defendant, is good cause to grant the motion. See our Per Curiam dated February 5, 1979, In Re: Belated Appeals in Criminal Cases, 265 Ark. 964.

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


author: Jack Holt, Jr., Chief Justice.

text:
    James CUMMINGS v. STATE of Arkansas
    CR 93-367
    869 S.W.2d 17
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994

      William R. Simpson, Jr., Public Defender, by: Bret Qualls, for appellant.

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

This is an appeal from criminal convictions on charges of possession of a controlled substance with intent to deliver, fleeing, and refusal to submit. The appellant, James Quincy Cummings, was sentenced to thirty-five years for possession, thirty days for fleeing, and ninety days for refusal to submit, with the latter two sentences to run concurrently with the first.

On appeal, Cummings argues a single point for reversal, namely that the evidence produced by the State was insufficient to support a conviction for possession of a controlled substance with intent to deliver. The issue, however, has not been properly preserved for appeal, and this court cannot consider it.

On June 18, 1992, the Pulaski County Prosecuting Attorney filed an information charging Cummings with the offenses of possession of a controlled substance with intent to deliver, fleeing, and refusal to submit. The record reveals that on the night oil April 1, 1992, Officers David Smith and Tommy Hudson of the Little Rock Police Department were on patrol in an area of the city that Smith characterized as “notorious” for sales of narcotics. They observed a man they identified as Cummings standing on a sidewalk and talking through a passenger window to a person seated in a car.

Both policemen stated that Cummings had money in his hand — a “wad,” according to Officer Smith. Surmising on the basis of past experiences in the area that a drug transaction might be in progress, the officers made a U-turn and approached the vehicle, which took off. The patrolmen stopped where the other car had been parked and approached Cummings, who fled on foot. As he ran, both officers recounted, he threw down a clear plastic bag.

Officers Smith and Hudson pursued Cummings around the corner of an apartment complex and apprehended him in front of a coin-operated laundry, where a brief altercation occurred as the officers attempted to take the suspect into custody. Neither officer stopped to pick up the discarded bag while giving chase, but after the arrest Officer Smith returned to the place where it had been dropped and retrieved it. He later initialed the bag and turned it over to Detective Robert Martin, who delivered it to the Arkansas State Crime Lab for analysis. Subsequent examination by Linda Burdick of the State Crime Lab showed that the contents of the plastic bag consisted of 2.795 grams of cocaine base.

After a jury trial, Cummings was convicted of all counts with which he was charged and was sentenced to thirty-five years for possession of a controlled substance with intent to deliver, thirty days for fleeing, and ninety days for refusal to submit. The latter two sentences were ordered to run concurrently with the thirty-five years imposed for possession.

Cummings argues on .appeal that the evidence presented at trial was not sufficient to support his conviction on the charge of possession of a controlled substance with intent to deliver. He insists that, even if he had briefly held the cocaine, his “fleeting handling” of the controlled substance did not amount to the species of control that can rightly be denominated “possession.” Any handling of the drugs, he asserts, “was, at the most, passing and shadowy in nature.”

This argument, however ingenious, may not be addressed. At the close of the State’s case, Cummings neglected to properly challenge the sufficiency of the evidence regarding possession through a motion for directed verdict.

Rule 36.21(b) of the Arkansas Rules of Criminal Procedure explicitly provides:

When there has been a trial by jury, the failure of a defendant to move for a directed verdict at the conclusion of the evidence presented by the prosecution and at the close of the case because of insufficiency of the evidence will constitute a waiver of any question pertaining to the sufficiency of the evidence to support the jury verdict.

See Hayes v. State, 312 Ark. 349, 849 S.W.2d 501 (1993); Collins v. State, 308 Ark. 536, 826 S.W.2d 231 (1992); DeWitt v. State, 306 Ark. 559, 815 S.W.2d 942 (1991). In no case has this court allowed a meritorious argument on the sufficiency of the evidence to prevail over the defendant’s failure to raise it in the trial court. Collins v. State, supra.

In the present case, after the prosecution rested, the trial court called counsel for the State and counsel for the defense to the bench. The following exchange occurred between the trial judge and the public defender:

THE COURT: Make your normal and customary and usual motions, and those motions are —

MR. DEVINE: Your Honor, specific — okay.

THE COURT: — considered and overruled.

MR. DEVINE: Specifically, as to Count II, the felony fleeing charge, Your Honor, I don’t believe that there would be sufficient evidence to go past this point on that due to the lack of injury on the part of Officer Smith here. I would also move to dismiss all these counts in that they fail to — the testimony that has been shown here today fails to make the proof that was alleged in the felony information, I believe, the allegation is that the incidents occurred on or about the date of April the 10th of 1992.1 believe all the testimony that has been before the court today is that this occurred or these incidents occurred on April the 1st of ‘92. It would be our position that the State has not met its burden of proof in regards to what they’ve alleged in the felony information.

MR. RUPLE: I think you’ll find an amended information in the file, Your Honor.

MR. DEVINE: And I’d like to be privy to that, ’cause I have never heard of it.

THE COURT: They did it. It was filed August the 12th.

MR. DEVINE: Okay. Well, I never got a copy of it.

MR. RUPLE: Well, it is in the file.

THE COURT: And I’d show that those motions are denied.

The public defender made a few more comments about the amended information, and the trial court then, in the jury’s hearing, directed him to call his first witness.

Following the close of the case for the defense, court was recessed, at which time the jury instructions were discussed and the public defender stated that “we renew all of our motions again,” to which the trial court responded, “At this time, at the close of all the case, the defendant renews all of the motions made at the close of the State’s case and those motions are again denied.”

Although, at the close of the State’s case, counsel for Cummings, without making a formal motion for a directed verdict, challenged the sufficiency of the evidence concerning the fleeing charge (which he has not appealed), yet he was silent on the issue of possession. It is clear from the context of the dialogue • reproduced above that the public defender’s assertion that “the State has not met its burden of proof in regards to what they’ve alleged in the felony information” was made solely in reference to the incorrect date on the original information and did not embrace any other evidentiary concern.

The trial court in turn merely alluded to the “normal and customary and usual motions” as it issued a blanket denial. Following the close of the defendant’s case, the public defender made a general renewal of “all of our motions.”

The situation here closely resembles that in Middleton v. State, 311 Ark. 307, 842 S.W.2d 434 (1992), where this court discussed a sufficiency argument that had not been preserved for appellate review: .

The record reflects that appellant waived his right to challenge the sufficiency of the evidence by failing to make a motion for directed verdict at the close of the state’s case before presenting evidence on his behalf. In addition, appellant again waived this argument when at the close of all evidence, he merely made “the usual motions.” A challenge to the sufficiency of the evidence, whenever it is made, requires a specific motion to apprise the trial court of the particular point raised; a general “usual motion” such as the one made by appellant will not suffice. Rule 36.21(b) is strictly construed. Easter v. State, 306 Ark. 452, 815 S.W.2d 924 (1991). We adhere to that strict construction and do not consider the merits of appellant’s challenge to the sufficiency of the evidence due to his waiver. McArthur v. State, 309 Ark. 196, 830 S.W.2d 842 (1992).

311 Ark. at 309, 842 S.W.2d at 435.

Counsel as well as trial courts have often, in their efforts to expedite proceedings, treated various matters, including motions for directed verdict, in a rather cursory fashion. Consequently, a premium has too often been placed, unintentionally, on procedural convenience at the expense of the observance of certain basic requirements. Rule 36.21 specifically requires that a defendant who wishes to challenge the sufficiency of the evidence move for a directed verdict at the close of the State’s case and at the close of the whole case. Failure to do so, we have repeatedly held, constitutes waiver of any question pertaining to the sufficiency of the evidence. DeWitt v. State, supra.

The reason for the rule is obvious. As we stated in Rudd v. State, 308 Ark. 401, 405, 825 S.W.2d 565, 567 (1992):

[A] motion for a directed verdict at the close of the plaintiff’s case has as its purpose a procedure for determining whether the plaintiff has met the burden of establishing a prima facie case, with that question to be resolved by the court as a matter of law. In the event the motion is overruled, the defendant may elect to stand on the motion or to go forward with the production of additional evidence, in which case he has waived any further reliance upon the former motion.

A motion for a directed verdict at the close of the entire case is rendered necessary, of course, by virtue of the automatic waiver that occurs when the defendant proceeds to mount a case.

In view of our strict construction of Ark. R. Crim. P. 36.21(b), we cannot consider Cummings’s sufficiency argument. The judgment of the trial court is affirmed.


text:
    Ronald and Vicki WYATT v. ST. PAUL FIRE & MARINE INSURANCE CO. and Lynn Nowlin Bryant
    93-566
    868 S.W.2d 505
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994
    [Rehearing denied February 21, 1994.]

      Boswell, Tucker & Brewster, by: Ted Boswell, for appellants.

      Shackleford, Shackleford & Phillips, P.A., by: Dennis Shackleford, for appellees.

      Newbern and Corbin, JJ, not participating.

   Jack Holt, Jr., Chief Justice.

The appellee, Ms. Lynn Nowlin Bryant, a licensed practical nurse employed by Warner Brown Hospital, gave information to a relative that the appellant, Ronald Wyatt, a hospital patient either had Acquired Immune Deficiency Syndrome (AIDS) or was being tested for AIDS. As a result, Mr. Wyatt sued Ms. Bryant and Warner Brown Hospital’s insurance company, St. Paul Fire & Marine Insurance Company (St. Paul). The trial court found in essence that the allegations raised by Ronald and Vicki Wyatt against the parties did not constitute medical malpractice pursuant to Ark. Code Ann. § § 16-114-201 - 209 and granted motions for summary judgment in the parties favor.

The issue before us is whether or not the trial court erred in finding that there was no genuine issue of material fact in which the court could determine that a medical malpractice occurred.

The appellant, Ronald Wyatt, was admitted to Warner Brown Hospital in El Dorado, Arkansas, for evaluation and treatment resulting from sudden onset of paralysis, weakness, slurred speech, and other symptoms. Mr. Wyatt was given a magnetic resonance imaging scan which revealed that his condition was consistent with “moderately extensive multiple sclerosis and AIDS cannot be excluded.”

One of the appellees, Lynn Nowlin Bryant, was a licensed practical nurse employed by Warner Brown Hospital during Mr. Wyatt’s hospitalization. Prior to learning of his test results, she told Suzanne Bryant, the manager of the Exxon Store in Hampton, Arkansas (and also the wife of Lynn’s husband’s first cousin), either that Mr. Wyatt had AIDS or that he was being tested for AIDS (the facts are in dispute as to this point). According to Lynn Bryant’s deposition, she wanted to convey this information to Suzanne because:

I knew that she worked with him when he delivered cakes to the store and I guess that I was maybe concerned for her health if he did in fact have it. I told Suzanne Bryant that Ronald Wyatt, who I found out from a nurse on my shift was a routeman for Dolly Madison, was being tested for AIDS, and three or four days later when the test results came back, I did tell her that they were negative and he had multiple sclerosis.

Mr. Wyatt and his wife filed two complaints against Ms. Bryant, alleging that her statements to a third party that he “has AIDS” constituted medical negligence, medical malpractice, invasion of privacy, defamation by slander, and the tort of outrage. His wife claimed as her cause of action that she suffered and continues to suffer loss of consortium and mental anguish.

The Wyatts also filed a complaint again St. Paul, alleging that the failure of the hospital and its employee, Ms. Bryant, to maintain “medical confidentiality” invaded his personal privacy. Further, he claimed that the hospital’s and its employee’s actions . constituted medical negligence, medical malpractice, invasion of privacy, defamation by slander, and the tort of outrage. His wife again claimed damages due to loss of consortium and mental anguish. Together, they claimed $600,000 in compensatory and $600,000 in punitive damages. After the trial court consolidated the three complaints, Ms. Bryant filed a petition for summary judgment, stating that there could be no cause of action for the defamation or slander claim because her statement was true and that no cause of action for medical negligence or medical malpractice existed under the circumstances of the case. The Wyatts responded that, because there was a factual dispute as to what Ms. Bryant had said with regard to Mr. Wyatt’s medical condition, summary judgment was inappropriate.

St. Paul also petitioned the trial court for summary judgment contending that Ms. Bryant’s statements, whatever they may have been, “occurred outside the course and scope of her employment, and plaintiffs cannot establish a prima facie case against Warner Brown Hospital on a respondeat superior theory.” The Wyatts responded in their pleadings by contending “that the statement made by Lynn Nowlin Bryant was made in the course and scope of her employment and that summary judgment on this issue is improper,” and that St. Paul’s “failure to offer proof on the causes of action which plaintiffs have filed in their complaint, is fatal to its motion for summary judgment.”

A hearing was held by the trial court on the two motions for summary judgment, the centerpiece of which was the question: whether or not Ms. Bryant’s statement constituted “malpractice” under Ark. Code Ann. § 16-114-201 - 209 (1987). During the course of the hearing, the trial judge noted that he was having a “hard time” with regard to the medical malpractice part of the arguments, although he viewed Ms. Bryant’s statements as possible matters of slander and breach of confidentiality.

After this hearing, the trial court issued its written order, which in the main provided:

1. The Motion for Summary Judgment of Defendant, St. Paul Fire & Marine Insurance Company, should be granted and the complaint as to St. Paul Fire & Marine Insurance Company should be dismissed with prejudice.
2. The Motion for Summary Judgment of Defendant, Lynn Nowlin Bryant, should be denied as to the claims for slander and outrage, and should be granted as to all others.

Thereafter, the Wyatts filed notice of appeal on both findings. Realizing that a claim for slander and outrage against Ms. Bryant remained and that the trial court’s order in this regard was not a final appealable order, the Wyatts filed a motion for voluntary dismissal of these claims against Ms. Bryant. This motion was granted and appropriate orders issued, leaving the trial court’s determination that an action for medical malpractice did not lie against Ms. Bryant or St. Paul as the primary issue before us, although there is disagreement among the litigants as to what constituted the basis of the court’s granting of summary judgment. The Wyatts approach their argument under the assumption that there is one central issue — whether or not the conduct of the defending parties constituted medical malpractice. St. Paul disagrees and contends that the basis of its motion was premised on whether Ms. Bryant was acting within the scope of her employment.

Although St. Paul’s motion for summary judgment addresses the issue of respondeat superior, not medical malpractice, and the trial judge may have based his judgment on this premise, we must first resolve the threshold question: was there a genuine issue of material fact as to whether or not Ms. Bryant’s statements constituted medical malpractice. If we hold that the issue of material fact exists, then the granting of a summary judgment to her favor by the trial court must be overturned and the issue of respondeat superior as to St. Paul properly addressed. Conversely, if we hold that the actions of Ms. Bryant did not constitute a medical malpractice, the issue of respondeat superior as to Ms. Bryant’s relationship with Warner Brown Hospital is of no concern.

Summary judgment is a remedy that should be granted only when it is clear that there is no genuine issue of material fact to be litigated. Hickson v. Saig, 309 Ark. 231, 828 S.W.2d 840 (1992). The burden of proving that there is no genuine issue of material fact is upon the movant, and all proof submitted must be viewed in a light most favorable to the party resisting the motion. Any doubts and inferences must be resolved against the moving party. Pinkston v. Lovell, 296 Ark. 543, 759 S.W.2d 20 (1988); Cross v. Coffman, 304 Ark. 666, 805 S.W.2d 44 (1991).The burden in a summary judgment proceeding is on the moving party and cannot be shifted when there is no offer of proof on a controverted issue. Collyard v. American Home Assurance Co., 271 Ark. 228, 607 S.W.2d 666 (1980). When the movant makes a prima facie showing of entitlement, the respondent must meet proof with proof by showing genuine issue as to a material fact. Harrell v. International Paper Co., 305 Ark. 490, 808 S.W.2d 779 (1991).

Arkansas Code Annotated § 16-114-200 et seq. governs actions brought for alleged malpractice by medical providers. Specifically, Ark. Code Ann. § 16-114-201 (1987) provides relevant definitions:

As used in this subchapter, unless the context otherwise requires:
(1) “Action for medical injury” means any action against a medical care provider, whether based in tort, contract or otherwise, to recover damages on account of medical injury;
(2) “Medical care provider” means a physician, certified registered nurse anesthetist, physician’s assistant, nurse. . . . (3) “Medical injury” or “injury” means any adverse consequences arising out of or sustained in the course of the professional services being rendered by a medical care provider, whether resulting from negligence, error or omission in the performance of such service; or of warranty or in violation of contract; or from failure to diagnose; or from premature abandonment of a patient or of a course of treatment; or from failure to properly maintain equipment or appliances necessary to the rendition of such services; or otherwise arising out of or sustained in the course of such services.

(Emphasis added.)

The question of what constitutes a “medical injury” under our code is not new to this court, although our attention to this issue has, for the most part, been secondary to other questions before us. In Sexton v. St. Paul Fire & Marine Ins. Co., 275 Ark. 361, 631 S.W.2d 270 (1982), a case in which a patient died as a result of a fall from his hospital bed, our court was closely divided on the question of whether the plaintiff had met her burden of proof, as required by our malpractice statute, as to the degree of skill used by other hospitals in the same or similar locality. In order to avoid meeting this burden, appellant argued that the decision whether or not to use a safety restraining vest to keep patients in bed was not a professional service. Relying on the fact that only a doctor could authorize the use of the vest, we held that its use was a professional service, and, thus, fit under our code definition of a medical injury.

Later in Brown v. St. Paul Mercury Ins. Co., 292 Ark. 558, 732 S.W.2d 130 (1987), upon which the Wyatts now rely to sustain their position, we again addressed the definition of “medical injury” but this time, in the context of our statutes of limitations as to a claim for wrongful death. In Brown, appellants, spouse and next of kin of Mr. Roy Brown, filed suit against an alcohol treatment center and its insurer after Mr. Brown, a patient, walked out of an unlocked door onto the roof of the treatment center and either jumped or fell to his death. The trial court granted the appellee’s motion for summary judgment, concluding that the two-year statute of limitation for medical injury barred the appellants’ claim. On appeal, appellants argued that Mr. Brown’s death was not the result of a medical injury. We held that it was within the scope of the center’s professional services to provide a safe environment for this patient and that failure to do so gave rise to a medical injury. Nevertheless, we reversed the trial court’s finding, explaining that although “Brown’s death is properly characterized as a medical injury, we hold that appellants’ claim is founded on our wrongful death statutes and that its three-year statute of limitations applies.” Brown, 292 Ark. at 560, 732 S.W.2d at 131. Thus, Wyatts’ reliance on Brown for an appropriate definition of “medical injury” is misplaced.

In addition, we basically overruled Brown by our holding in Bailey v. Rose Care Center, 307 Ark. 14, 817 S.W.2d 412 (1991). Ms. Bailey, the sister of Mr. Dowdy, an eighty-nine year old patient of the Rose Care Center, filed suit alleging negligence on the part of the center after Mr. Dowdy left the center in his wheelchair and was struck by a car and killed. After the jury returned a verdict in favor of the appellees, Ms. Bailey appealed contending, in part, that the trial court erred in giving AMI 1501, the jury instruction given in cases involving medical injuries. Holding that the accident was not the result of a “medical injury” but instead involved a question of whether the patient was properly supervised by the LPN and five nurses aides on duty that night, we stated:

On reexamination, we conclude that the facts set out in Brown did not fall within the definition of medical injury. . . . [T]he circumstances in Brown did not involve a professional service but instead raised only the question of whether a patient was properly supervised by the health center’s staff. Likewise, in the present case, while Mr. Dowdy was in a wheelchair, he was not ordered by a doctor to be restrained and was able to move around the nursing home at will. ...
In sum, Mr. Dowdy was under a doctor’s care while he was in the nursing home, but his death was not the result of a doctor’s treatment or order. Instead, the question is whether Mr. Dowdy was properly supervised by the one LPN and five nurse’s aides on duty that night. The answer to this question merely requires the jury to decide whether the nursing home used ordinary care in furnishing Mr. Dowdy the care and attention reasonably required by his mental and physical condition.

Bailey, 307 Ark. at 19, 817 S.W.2d at 414-415.

Applying the rationale of Bailey to the facts at hand, it is clear that the actions of Lynn Bryant in revealing confidential information she acquired at work did not fall within our expressed view of what constitutes a medical injury. In further evaluating this issue, we consider the rationale of a New York Supreme Court decision, Tighe v. Ginsberg, 540 N.Y.S.2d 99, 146 A.D.2d 268 (1989), helpful. There, the plaintiff visited the defendant doctor for treatment of a hearing problem and sued him when the doctor disclosed his medical records without authorization. In determining which statute of limitations applied, the New York court held that this “unauthorized disclosure” was an action sounding in negligence and not in medical malpractice. As the New York court stated, “Although in a general sense a doctor furnishes medical care to patients, clearly not every act of negligence toward a patient constitutes medical malpractice.” Tighe, 540 N.Y.S.2d at 100.

Also convincing is the New York Supreme Court’s decision in Borrillo v. Beekman Downtown Hosp., 537 N.Y.S.2d 219, 146 A.D.2d 734 (1989), in which the court held:

The distinction between ordinary negligence and malpractice turns on whether the acts or omissions complained of involve a matter of medical science or art requiring special skills not ordinarily possessed by lay persons or whether the conduct complained of can instead be assessed on the basis of common everyday experience of the trier of facts. Where the matter requires the consideration of the professional skill and knowledge of the practitioner of the medical facility, the more specialized theory of medical malpractice applies.

(Citations omitted.) But see, contra, Watts v. Cumberland County Hosp. System Inc., 75 N.C. App. 1, 330 S.E.2d 242, later proceeding, 74 N.C. App. 769, 330 S.E.2d 256 (1985), and rev’d on other grounds, 317 N.C. 321, 345 S.E.2d 201 (1986) (as cited in Holly Piehler Rockwell, Annotation, What patient claims against doctor, hospital or similar health care provider are not subject to statutes specifically governing actions and damages for medical malpractice, 89 A.L.R. 4th 887, § 39 (1991)).

In sum, we are not inclined to extend the definition of medical injury to the facts before us, and we hold that the trial court did not err in granting summary judgment in favor of St. Paul and Ms. Bryant.

Glaze, J., not participating.


author: Robert H. Dudley, Justice.

text:
    Steven Ray WEGER v. STATE of Arkansas
    CR 93-408
    869 S.W.2d 688
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994

      Joe Kelly Hardin, for appellant.

      Winston Bryant, Att’y Gen., by: Teena L. White, Asst. Att’y Gen., for appellee.
   Robert H. Dudley, Justice.

Appellant was convicted of the capital murder of one victim and the attempted capital murder of another. He was sentenced to life in prison without parole for the capital murder and to thirty years for the attempted capital murder. We affirm both judgments of conviction.

We need not set out the facts of the murder and attempted murder since appellant does not contend that the evidence presented was insufficient to sustain either of the convictions. Rather, he argues that the trial court made reversible trial error in two evidentiary rulings. His first assignment is that, pursuant to the doctrine of Miranda v. Arizona, 394 U.S. 436 (1966), the trial court erred in admitting his confession into evidence. The assignment logically must be divided into two sub-parts: (1) the trial court erred in holding that the proof showed that the waiver and confession were voluntarily given; and (2) the trial court erred in holding that the proof showed that the waiver and confession were knowingly and intelligently given.

In Moran v. Burbine, 475 U.S. 412 (1986), the Supreme Court clarified the standards governing the waiver of rights under the Miranda doctrine as follows:

The inquiry has two distinct dimensions. First, the relinquishment of the right must have been voluntary in the sense that it was the product of a free and deliberate choice rather than intimidation, coercion, or deception. Second, the waiver must have been made with a full awareness both of the nature of the right being abandoned and the consequences of the decision to abandon it. Only if the “totality of the circumstances surrounding the interrogation” reveal both an uncoerced choice and the requisite level of comprehension may a court properly conclude that the Miranda rights have been waived.

Id. at 421 (citations omitted).

In Colorado v. Connelly, 479 U.S. 157 (1986), the Supreme Court further refined the dimensions of voluntariness. In that case the Colorado Supreme Court had ruled a confession by a schizophrenic was involuntary because it was not the product of unfettered free will. The Colorado court found no police misconduct, but held that the police should not take advantage of a person in this condition. The Supreme Court reversed, stating that in the past it had focused on police overreaching, not just on the mental condition of the defendant. It emphasized that, while the mental condition of the defendant is a significant factor in the voluntariness calculation, it should never settle the voluntariness issue by itself and apart from its relation to official coercion. Id. at 164. Connelly holds that coercive police activity is a necessary predicate to finding a confession involuntary within the meaning of the Due Process Clause of the Fourteenth Amendment. Id. at 167. In addition, Connelly requires that the State prove the confession was voluntary only by a preponderance of the evidence and that the same standard applies to proof that a waiver was knowingly and intelligently made. Id. at 168.

In the case at bar, there was no coercive police activity. Appellant argues that the police began questioning him “within 30 to 45 minutes of being apprehended” and that he was “frightened, tired, and hungry” after being “chased all night” and that a policeman told him it would be “in his best interest to make a statement.” Appellant’s fatigue and hunger were the result of his own actions, not those of the police. The questioning began within a very reasonable time. Appellant does not argue that he was subjected to physical or emotional coercion and none is apparent from the record. He does argue that a policeman told him it would be best for him to make a statement, but the officer denied making such a statement. The trial court heard the testimony of both, and found the officer’s testimony to be more credible. That ends the matter, as we have repeatedly held that we will defer to the trial court’s finding of fact when the only determination to be made is the credibility of witnesses. Shaw v. State, 299 Ark. 474, 478, 773 S.W.2d 827, 829 (1989). In summary, the trial court did not err when it ruled that the state proved the waiver and confession were voluntarily given.

The second sub-part of the argument is that the waiver and confession were not shown to have been knowingly and intelligently given. The basis of this argument is that the waiver of rights form used by the officer did not sufficiently inform appellant of his Miranda rights. The core of the holding in Miranda is as follows:

To summarize, we hold that when an individual is taken into custody or otherwise deprived of his freedom by the authorities in any significant way and is subjected to questioning, the privilege against self-incrimination is jeopardized. Procedural safeguards must be employed to protect the privilege, and unless other fully effective means are adopted to notify the person of his right of silence and to assure that the exercise of the right will scrupulously honored, the following measures are required. He must be warned, prior to any questioning that he has the right to remain silent, that anything he says may be used against him in a court of law, that he has the right to the presence of an attorney, and that if he cannot afford an attorney one will be appointed for him prior to any questioning if he so desires.

Miranda, 394 U.S. 478-79 (emphasis added).

The form used for advising appellant of his Miranda rights contains each of the elements set out above. In fact, the language of the form is almost identical to that used in the opinion. Thus, the trial court did not err in ruling that the waiver of rights form used by the police fully advised appellant of his rights under the Miranda doctrine.

Appellant’s second assignment is that the trial court erred in admitting photographs of the murder victim into evidence after the jury had already been shown a videotape of crime scene. The essence of his argument is that, after showing the videotape, admitting the photographs was cumulative, and the photographs were used merely to inflame the jury,

The photographs at issue showed the murder victim and her wounds. They were relevant evidence. “Relevant evidence” was evidence that had any tendency to make the existence of any fact of consequence to the determination of guilt of capital murder or attempted capital murder more or less probable. A.R.E. Rule 401. However, even if relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice. A.R.E. Rule 403. We have repeatedly held that the balancing of probative value against prejudice is a matter left to the sound discretion of the trial judge, and a trial judge’s ruling on this issue will not be disturbed absent a showing of manifest abuse. Haynes v. State, 309 Ark. 583, 832 S.W.2d 479 (1992).

Although we give great deference to the trial court’s discretion in a 403 weighing of probative value versus prejudice, we have rejected giving a trial court unlimited authority to admit photographs. Berry v. State, 290 Ark. 223, 227, 718 S.W.2d 447, 450 (1986). We require a trial court to first consider whether relevant evidence creates a danger of unfair prejudice, and then to determine whether the danger of unfair prejudice substantially outweighs its probative value. Beed v. State, 217 Ark. 526, 609 S.W.2d 898 (1980).

The mere fact that a photograph is inflammatory or is cumulative is not, standing alone, sufficient reason to exclude it. Walton v. State, 279 Ark. 193, 650 S.W.2d 231 (1983). Even the most gruesome photographs may be admissible if they assist the trier of fact in any of the following ways: by shedding light on some issue, by proving a necessary element of the case, by enabling a witness to testify more effectively, by corroborating testimony, or by enabling jurors to better understand the testimony. Perry v. State, 255 Ark. 378, 500 S.W.2d 387 (1973). Of course, if a photograph serves no valid purpose and could be used only to inflame the jurors’ passions, it should be excluded. Gruzen v. State, 267 Ark. 380, 591 S.W.2d 342 (1979).

In this case the trial court instructed the prosecuting attorney as follows:

Any pictures that you put into evidence that depict the bodies are going to have to be put in for the purpose of assisting Dr. Sturner [state medical examiner] in his testimony and in describing to the jury what his finding were in reference to the injuries received and what his conclusions are with reference to the dynamics of the occurrence, and for those reasons you can put any of those photographs into evidence, but it is going to be limited to that.

In chambers, the trial court then examined each of the photographs and ruled on those that might be admitted for the purpose of assisting the medical examiner in his testimony. All others were excluded.

To secure a conviction for capital murder, the State had the burden of proving that appellant caused the death of the victim “under circumstances manifesting extreme indifference to the value of human life.” Ark. Code Ann. § 5-10-101(a)(l) (Repl. 1993). The nature and extent of a victim’s wounds is relevant to a showing of intent, and the intent may be inferred from the type of weapon used, the manner of use, and the nature, extent, and location of the wounds. Garza v. State, 293 Ark. 175, 735 S.W.2d 702 (1987). The photographs allowed in evidence showed the nature and extent of the wounds and show that at least two shots were fired and one victim was stabbed. In addition, the photographs refute the part of appellant’s confession in which he claimed that he only fired one shot. In sum, the trial court did not abuse its considerable discretion in weighing the probative value against prejudice before allowing the photographs to be admitted into evidence.

Appellant has been sentenced to life imprisonment, without parole. Accordingly, pursuant to Rule 4-3(h) of the Rules of the Supreme Court and Court of Appeals, an examination of all rulings adverse to appellant has been made, and there is no reversible error in those rulings.

Affirmed.


author: Steele Hays, Justice.

text:
    W.J. “Bill” McCUEN, et al. v. Benjamin L. McGEE, et al.
    93-581
    868 S.W.2d 503
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994

      Ronald C. Wilson, for appellant.

      Arnold, Grobmyer & Haley, for appellee.
   Steele Hays, Justice.

This action for mandamus and declaratory judgment was brought by Benjamin L. McGee (appellee) to determine whether Ronald Carl Wilson (appellant) was eligible to seek the office of House of Representatives, District 95, Crittenden County, Arkansas, in the general election held in November, 1992. The question we are asked to decide was rendered moot by that election and that resolves the dispute.

In October, of 1991 the Board of Apportionment of the State of Arkansas, pursuant to litigation pending in federal district court, adopted a plan of reapportionment redefining several districts of the Arkansas House of Representatives. The plan and attendant maps and exhibits were filed with the Secretary of State in January, 1992. The plan became final in February, 1992, for purposes of the primary and general elections of that year. See Harvey v. Clinton, 308 Ark. 546, 826 S.W.2d 236 (1992).

Under the plan House District 48 of Crittenden County, a single, multi-member district, became two districts- District 95 and 96. The two districts were divided by Judge Smith Drive in the City of Marion- District 95 to the north and District 96 to the south.

Appellee Benjamin L. McGee was elected to the seat representing District 48 at the 1988 election and resided in the successor district, District 95. McGee filed for that position in the Democratic primary of 1992 and was elected without opposition.

On April 29, 1992, Ronald Carl Wilson completed the necessary forms to qualify as an independent candidate for District 95 and filed them with the Secretary of State. Those documents reflected that Wilson resided on the south side of Judge Smith Drive and, hence, in District 96. The Secretary of State certified appellant Wilson’s name to the Crittenden County Board of Election Commissioners as an independent candidate for the general election in 1992.

Thereafter appellees McGee and Helen Adams, a registered voter of District 95, petitioned for a writ of mandamus and declaratory judgment in the Circuit Court of Pulaski County to determine on an expedited basis the eligibility of appellant Wilson to be a candidate in District 95. Named as respondents were W.J. “Bill” McCuen, Ronald Carl Wilson and the members of the Board of Election Commissioners of Crittenden County. Following a hearing the trial court found on undisputed testimony that Wilson resided outside District 95 and therefore was not a resident of the district for one year preceding the election as required by Article 5, Section 4 of the Arkansas Constitution. The court declared that Wilson should not have been certified as a candidate in District 95 and that mandamus should issue to remove his name from the ballot or, if impracticable, to refrain from counting any votes cast for him. The trial court rejected Wilson’s contention that because District 95 had not been in existence for one year it was impossible to have met the residency requirement of art. 5, § 4.

Ronald Carl Wilson has appealed on four assignments of error: the trial court erred in finding him ineligible to run in District 95; even if the Arkansas Constitution requires residency in District 95 for one year it was impossible to meet that requirement since District 95 had not existed for a year; the trial court erred in admitting petitioner’s exhibits 1 and 2, maps of reapportionment; and the trial court erred in not deferring to the pending federal litigation.

In response, appellee McGee maintains that the abstract is flagrantly deficient under rule 4-2(b)(l)(2) in that the testimony before the trial court is reproduced verbatim with no attempt at condensation and that neither the judgment nor two crucial exhibits- the maps of Districts 95 and 96 are abstracted. However, we need not address the sufficiency of the abstract as we agree with appellee that inasmuch as appellant made no attempt to obtain a stay from the trial court or this court and McGee was certified as the successful candidate to represent District 95, has taken his seat and is now serving, the issue is wholly moot.

We have often said we do not render advisory opinions. Robinson v. Craighead County Board of Election Commissioners, 300 Ark. 405, 779 S.W.2d 169 (1989); Stafford v. City of Hot Springs, 276 Ark. 466, 637 S.W.2d 553 (1982); McCuen v. Harris, 271 Ark. 863, 611 S.W.2d 503 (1981). There are exceptions where the public interest is involved and the issue tends to become moot before it can be fully litigated. See Robinson v. Craighead, supra. But appellant has not addressed that question except insofar as his own interest is concerned and we are not persuaded that an exception should be made in this case. The lapse of time has cured any recurrence of the residency issue with respect to these districts and we do not foresee a need to issue an opinion which would be clearly advisory.

Affirmed.

Brown, J., not participating.

         Jeffers, et al. v. Clinton, et al, 740 F. Supp. 196 (E.D. Ark. 1990).


author: David Newbern, Justice. Robert L. Brown, Justice,

text:
    ATLANTA CASUALTY COMPANY v. Clovis G. SWINNEY
    93-645
    868 S.W.2d 501
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994

      Dennis Zolper, for appellant.

      Womack, Landis, Phelps, McNeill & McDaniel, by: Lucinda McDaniel, for appellee.
   David Newbern, Justice.

The question we must decide is whether the Trial Court was correct in determining that proof of mailing of a notice of cancellation on an automobile liability policy was sufficient to establish notice of cancellation, as a matter of law, when the insured denies receipt of the notice. We hold the Trial Court was correct.

Mr. Swinney applied for car insurance with Atlanta Casualty Company (Atlanta) on August 2, 1991. He obtained a policy binder, number 02301813, effective August 2, 1991, through February 2, 1992. Mercantile Bank of Jonesboro (the Bank) was designated the loss payee. At some point, Atlanta determined that Mr. Swinney did not own the car described in the policy and that the policy would have to be cancelled. The vehicle was damaged in a one vehicle accident on September 19, 1991.

Atlanta denied coverage, arguing that a notice of cancellation of the policy was issued and mailed on August 29, 1991, making cancellation effective as of September 18, 1991. In addition, the agent writing the binder informed Swinney by a “memo-letter” dated September 5, 1991, that the policy was to be can-celled and asked that he return to the agency before the cancellation date to make other arrangements for insurance. Mr. Swinney did not return to the agent or obtain other coverage prior to the accident.

Suit was filed when Atlanta denied coverage. Atlanta moved for summary judgment and presented the affidavit of Stacey Sewell, the person responsible for mailing notices of cancellation from Atlanta’s home office in Norcross, Georgia. The documents accompanying that affidavit showed that on August 29, 1991, Ms. Sewell handled over 100 notices of cancellation which were mailed to individuals. Mr. Swinney’s name was included in the listing for that date. Ms. Sewell also had a listing of over 100 lienholders, including the Bank. In response Mr. Swinney asserted the failure to receive notice.

The Triál Court granted the motion for summary judgment finding that because Ark. Code Ann. § 23-89-304(a)(l) and 306 (Repl. 1992) provides that proof of mailing is sufficient to constitute notice of cancellation, receipt was factually irrelevant.

The Court of Appeals reversed the Trial Court, holding that the denial of receipt by Mr. Swinney and the Bank created a remaining genuine issue of material fact, and thus summary judgment was improperly entered. Ark. R. Civ. P. 56(c). In this review, Atlanta argues the decision of the Court of Appeals is contrary to and thus effectively and improperly repeals Ark. Code Ann. § 23-89-306 (1987) and must be overturned.

The statutes clearly state the intent of the General Assembly. Arkansas Code Ann. § 23-89-304 (1987) sets out time limits on notices of cancellation, and Ark. Code Ann. § 23-89-305 (1987) provides for notices of non-renewal. Then § 23-89-306 provides:

23-89-306. Proof of mailing of notices.
Proof of mailing of notice of cancellation, or of intention not to renew, or of grounds for cancellation to the named insured at the address shown in the policy shall be sufficient proof of notice.

The record contains the listings of cancellations mailed, showing the correct addresses for both Swinney and Mercantile Bank. The affidavit includes a statement of the employee indicating that these items were mailed and a certification by a postal employee verifying the mailing. The documents also show that the notices were mailed in a timely fashion in compliance with § 23-89-304. Whether the notice was received by Mr. Swinney and the Bank is irrelevant according to the statute, as “[p]roof of mailing” is “sufficient proof of notice.” Mr. Swinney presented no evidence to challenge the proof of mailing.

The Court of Appeals relied upon two cases. In Harrison v. State Farm Mutual Insurance Co., 230 Ark. 630, 326 S.W. 2d 803 (1956), we held in a somewhat similar situation that a factual issue was presented when an insurance company employee testified that company records revealed the mailing of a notice of cancellation which the alleged insured said he had not received. That case, however, was decided some 13 years prior to the enactment of § 23-89-306, and it cannot be regarded as adequate precedent in view of the statute.

The other case relied on by the Court of Appeals is Swink & Co. v. McEntee & McGinley, Inc., 266 Ark. 279, 584 S.W. 2d 393 (1979). While this case was decided after enactment of the statute, it is a securities case not governed by the Insurance Code of which § 23-89-306 is a part.

The holding of the Court of Appeals is reversed, and the summary judgment in favor of Atlanta is reinstated.

Reversed.

Corbin and Brown, JJ., concur.

Robert L. Brown, Justice,

concurring. The issue before us is whether proof of mailing of the notice of cancellation was so conclusive that the issue could be decided by summary judgment as a matter of law.

The applicable statutes read that notice of cancellation is effective by mailing or delivery to the insured and that proof of mailing is sufficient proof of notice. Ark. Code Ann. §§ 23-89-304(a)(1), 23-89-305 (1987). On August 29, 1991, 116 notices of cancellation were delivered by Atlanta Casualty in one batch to the postmaster in Georgia. Those notices included one to Clovis Swinney. That same date, 105 notices were delivered to the same postmaster in a second batch which included a notice to Swinney’s lienholder, Mercantile Bank of Jonesboro. The postmaster then signed a form that he “personally mailed” the notices to the insured and the lienholder and the same date signed a certificate that the 221 notices were sent by bulk mail.

There was no certification given by the postmaster to Atlanta Casualty that an individual letter had been sent to Swinney. There was no return receipt from Swinney following delivery of certified mail to him. Swinney signed an affidavit that he did not receive the notice. The lienholder, Mercantile Bank of Jonesboro, also denied receiving notice.

Under our statutes, what happens after mailing, including receipt of notice of cancellation, is irrelevant. Thus, the mere fact that the postmaster certifies that he mailed the notice, albeit by bulk mail, concludes the matter. This raises in my mind, however, a basic question of due process: Should an insurance company be permitted to terminate coverage without some assurance that the insured has been notified of that termination? Swinney does not make a due process argument in this appeal, and for that reason we do not address it. That issue is reserved for another day.

Corbin, J., joins.


author: David Newbern, Justice.

text:
    Tony MILLER v. Manuel NIX
    93-687
    868 S.W.2d 498
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994

      John F. Stroud III, for appellant.

      Honey & Honey, P.A., for appellee.
   David Newbern, Justice.

Tony Miller appeals from a directed verdict in favor of the appellee, Manuel Nix. The Trial Court granted the directed verdict after finding Mr. Miller had failed to prove his damages on his tort claim at trial. Mr. Miller contends that was error. He also asserts error in two evidentiary rulings made by the Trial Court. We affirm the directed verdict.

During the early morning of May 15, 1989, Tony Miller was driving to work through a rural area of Nevada County. It was dark and foggy, and as he approached the point at which the highway passed land owned by Mr. Nix, his car struck a cow which was in the middle of the road. The collision killed the cow and caused serious injury to Mr. Miller.

Mr. Miller spent two weeks in a hospital and was not able to return to work for approximately three months. Until he fully recovered, he suffered memory loss and coordination problems.

Mr. Miller alleged Mr. Nix was negligent in failing to maintain his fence, failing to warn that his livestock were at large in the highway, and failing to maintain a proper enclosure despite repeated occurrences of escaping cattle. The complaint alleged these negligent omissions proximately caused the injuries and sought $3,290,000 in damages.

During the first trial Mr. Miller testified Mr. Nix offered to provide whatever help he could after the accident. The Trial Court ruled this testimony related to settlement negotiations and ordered a mistrial. .

For purposes of the second trial several evidentiary rulings were made by the Trial Court. One concerned the testimony of Mr. Nix’s neighbors, James and Emily Gannon. They were prepared to testify that Mr. Nix repaired his fence the day after the accident. The Trial Court ruled this testimony was prohibited as evidence of a subsequent remedial measure under Ark. R. Evid. 407.

The Trial Court also decided to limit further testimony of the Gannons. They were prepared to testify that in a three-year period before Mr. Miller’s accident they observed Mr. Nix’s cattle at large twenty to twenty-five times. The judge ruled some of the time period was too remote, and limited the Gannons’ testimony to incidents within six months before the accident.

Mr. Miller called several witnesses. No one could identify the cow that was struck as belonging to Mr. Nix. During cross examination of these witnesses, the defense elicited testimony that cattle frequently escape and that several land owners in the vicinity of the accident own cattle.

Mr. Miller’s attorney also played video taped testimony of Dr. Bohmfalk who testified concerning the injuries, his treatment of them, and Mr. Miller’s recovery. He stated that although the injuries were severe, he believed Mr. Miller had made a complete recovery. Dr. Bohmfalk further stated his fee for Mr. Miller’s care was reasonable and customary.

After this testimony, Mr. Miller’s attorney attempted to introduce an affidavit prepared by Dr. Bohmfalk stating the total cost of the medical care was $34,450.94. Attached to this affidavit were medical bills of other doctors who provided treatment. The Trial Court ruled the affidavit was hearsay and inadmissible.

At the close of Mr. Miller’s case, the defense moved for a directed verdict based on the fact Mr. Miller had failed to prove the cow he struck belonged to Mr. Nix, lack of evidence that Mr. Nix was negligent, and lack of evidence establishing Mr. Miller’s damages. The Trial Court reviewed this motion at length, and determined Mr. Miller had presented insufficient evidence to go to the jury on the issue of damages. For this reason, the Trial Court granted a directed verdict in favor of the defendant.

1. Directed Verdict

In reviewing a directed verdict, we review the evidence in a light most favorable to the non-moving party and give it its highest probative value, taking into account all reasonable inferences. Mankey v. Wal-Mart Stores, Inc., 314 Ark. 14, 858 S.W.2d 85 (1993). A motion for a directed verdict may only be granted if there is no substantial evidence to support a jury verdict. Id.; Boykin v. Mr. Tidy Car Wash, Inc., 294 Ark. 182, 741 S.W.2d 270 (1987). In reviewing a trial court’s decision, we uphold the ruling if it reached the right result, even though it announced a reason different from the one we assert. Smackover State Bank v. Oswalt, 307 Ark. 432, 821 S.W.2d 757 (1991).

The Trial Court granted a directed verdict on the issue of damages. The result was correct, as Mr. Miller failed to prove Mr. Nix’s negligence proximately caused any damage.

The Trial Court found Mr. Miller had presented evidence of negligence by testimony of the condition of Mr. Nix’s fences six months prior to the accident and by testimony of the state trooper investigating the accident, Officer Rateliff. Officer Rateliff testified that, while at the scene of the accident, he inspected the fence line. He found the fence to be in need of repair; however, he failed to find any holes through which a cow could escape.

Additionally, the Trial Court found Mr. Miller presented no direct evidence to prove Mr. Nix owned the cow that was struck. The Trial Court, however, found sufficient evidence to go to the jury on this issue in the testimony of the Gannons. The Gannons’ testimony was that, within the six months prior to Miller’s accident, they had observed Nix’s cattle at large on a few occasions.

The problem we find in this evidence is that, when taken together, it fails to show how Mr. Nix’s negligence, if any, may have proximately caused Mr. Miller’s injuries. We have defined proximate cause as that which, in a natural and continuous sequence, produces damage. Johnson v. Jones, 313 Ark. 449, 855 S.W.2d 315 (1993). Trooper Rateliff expressly stated he observed no openings in Mr. Nix’s fence from which a cow might have escaped. While the Gannons’ testimony showed the cow involved in the accident might have been Mr. Nix’s, when read with Rateliff’s testimony, it does not show any negligence which could have led to the cow being in the road. For this reason, we cannot say the Trial Court erred in granting a directed verdict.

2. Subsequent remedial measures

Mr. Miller also contends the Trial Court erred in excluding a portion of the Gannons’ testimony. This testimony indicated that Mr. Nix repaired his fences the day after the accident. The Trial Court ruled that this testimony was excluded by Ark. R. Evid. 407. Mr. Miller’s attorney argued this testimony was being introduced to show ownership of the cow, thus falling within an exception to Rule 407. The Trial Court responded the testimony showed ownership of the fence, not the cow. As Mr. Nix admitted he owned the fence, the Trial Court reasoned this issue was not in controversy, and continued to exclude the testimony.

Arkansas R. Evid. 407 prohibits evidence of subsequent remedial measures to prove negligence, but makes exceptions if the evidence is introduced for another purpose, such as “ownership, control, or feasibility of precautionary measures, if controverted, or impeachment.”

In Gist v. Meredith Marine Sales & Service, 272 Ark. 489, 615 S.W.2d 365 (1981), we held that a matter sought to be proven by an exception to Rule 407 must actually be in controversy. In the Gist case, the appellant was trying to establish the feasibility of subsequent repairs which had been admitted by the appellee. This interpretation of Rule 407 is supported by Hull v. Chevron, U.S.A., 812 F.2d 584 (10th Cir. 1987). There an oil worker was injured when a drill bit he was installing rolled off the tine of a forklift and onto his leg. The plaintiff sued Chevron and Chase Drilling Company.

An issue at trial was which defendant controlled the daily operations of the well. Chevron sought to introduce evidence, for the purpose of showing control, that after the accident, Chase permitted only one employee to operate the forklift, and fired the one operating the forklift when the plaintiff was injured.

The Trial Court refused to admit this evidence. The United States Court of Appeals for the Tenth Circuit affirmed the decision, stating the control of the forklift was not controverted. The issue, rather, was which party controlled the general day-today operation of the oil rig. Just as control of the fork lift was not at issue in the Hull case, ownership of the fence is not at issue here. While repair of the fence may be relevant to negligence in its maintenance, Rule 407 makes it inadmissible for that purpose. It does not tend to show ownership of the cow which would constitute an exception pursuant to the Rule.

3. Exclusion of other testimony

Mr. Miller also contends the Trial Court erred in excluding further testimony of the Gannons. This proffered testimony indicated the Gannons observed Mr. Nix’s cattle at large twenty to twenty-five times in a three year period before the accident. The Trial Court ruled that this period was too remote in time, and limited the testimony to instances within six months of the accident.

This ruling was based on Ark. R. Evid. 403. Our standard of review is abuse of discretion. We hold the Trial Court did not abuse its discretion as there is nothing to suggest that the six-month period was unreasonable or unfair to either party.

4. Abstract

The appellee has prepared a supplemental abstract and moves for costs. We agree that the appellant’s abstract is flagrantly deficient and the appellee’s supplemental abstract is appropriate pursuant to Ark. Sup. Ct. R. 4-2(b)(2). The appellee requests $3,956.25 in fees and expenses. We award $2,500.

Affirmed.

Hays, J., dissents.


text:
    Lee DOUGLASS, Commissioner of the Insurance Department for the State of Arkansas v. DYNAMIC ENTERPRISES, INCORPORATED d/b/a Car-Mart
    93-663
    869 S.W.2d 14
    Supreme Court of Arkansas
    Opinion delivered January 24, 1994
    [Rehearing denied March 7, 1994.]

      Cynthia L. Uhrynowycz, for appellant.

      J. Scott Greear, for appellee.

      Corbin, J. not participating.

   Tom Glaze, Justice.

This case presents an issue of first impression regarding whether a debt cancellation contract is insurance as defined by the Arkansas Insurance Code. Following administrative procedures which resulted in the determination by the Insurance Commissioner that the contract was an insurance product, Dynamic Enterprises, Inc. appealed to the Pulaski County Circuit Court pursuant to Ark. Code Ann. § 23-61-307 (Supp. 1993). The circuit court reversed the Commissioner, and held that contracts of debt cancellation are not insurance. The Commissioner appeals from that order. Because we find that Dynamic’s debt-cancellation contract is insurance under the law of Arkansas, we reverse and remand.

Dynamic is a used-car dealership which finances the sale of its vehicles to purchasers. As part of its sales, Dynamic proposed to offer an additional contract, entitled “Total Loss-Vehicle Purchase Contract Waiver”, which could be purchased for a weekly or monthly fee. The contract is one of debt cancellation, and provides that Dynamic will extinguish the outstanding debt on a vehicle purchased and financed through it, if the vehicle is wrecked and totalled, or stolen through no fault or negligence of the purchaser. Further, the contract provides the purchaser with the option of applying the salvage value of the “lost” vehicle to the purchase price of another vehicle from Dynamic. Dynamic, under the contract, determines whether a vehicle is a “total loss.”

While normally this court’s standard of review of a cir- ■ cuit court sitting without a jury is whether the findings are clearly erroneous, review of administrative agency decisions by both the circuit court and this court is limited in scope. The appellate court’s review is directed, not toward the circuit court, but toward the decision of the agency, and the construction of a statute by an administrative agency is not overturned unless it is clearly wrong. In addition, the court will not substitute its judgment for that of the agency unless the agency’s decision is arbitrary and capricious. And finally, the evidence is given its strongest probative force in favor of the agency’s ruling, and this court may not reverse the agency’s decision if there is any substantial evidence to support its decision. Brimer v. Arkansas Contractors Licensing Board, 312 Ark. 401, 849 S.W.2d 948 (1993).

Ark. Code Ann. § 23-60-102(1) (1987) defined insurance as “a contract whereby one undertakes to indemnify another or pay a specified amount or provide a designated benefit upon determinable contingencies[.]” In West & Co. of La., Inc. v. Sykes, 257 Ark. 245, 515 S.W.2d 636 (1974), the court identified an analysis in determining whether a particular contract or activity constitutes the business of insurance, and in doing so, set out the following determinative factors: (1) whether the plan is mandatory, (2) whether a profit motive exists in offering the plan, and (3) whether the plan is intended to be actuarially sound. At issue in West was an employer’s plan to self-insure its employees for medical expenses which this court found was not an insurance product within the Insurance Code. In City of Marianna v. Ark. Municipal League, 291 Ark. 74, 722 S.W.2d 578 (1987), the court cited the analysis in West, but found the determinative factor was whether there was a lack of profit motive.

Here, the Commissioner argues that Dynamic’s sole motive for offering the cancellation contract is profit. The Commissioner points to the fact Dynamic’s debt cancellation contract is similar to a policy issued by American Pioneer Insurance, a qualified, regulated insurer, for whom Dynamic had previously marketed its policy. American Pioneer offered its policy to make a profit, and the Commissioner suggests Dynamic, too, stands to gain monetarily from the sale of its contracts. The record certainly seems to support the Commissioner’s position since Dynamic proposed to charge its customers two dollars per week for the contract and estimated it would receive an annual sum of $416,000. Further, the Commissioner argues the terms and provisions associated with insurance are contained within Dynamic’s contract, and that this would lead the consumer to believe he was purchasing an insurance policy. We find the Commissioner’s arguments persuasive in finding that Dynamic’s motive is the expectation of profit.

The Commissioner cites a number of cases from other states where debt-cancellation contracts have been found to be analogous to credit-life policies, and thus insurance products within those states’ definition of insurance. Review of these cases, as well as others, demonstrates that generally contracts with debt-cancellation clauses have been considered contracts of insurance, and thus invalid, when: (1) the cancellation clause is mandatory, (2) the purchaser pays a fee for inclusion of the clause, (3) profit-making by the vendor is a major reason for including the clause, (4) risk of loss is placed on the purchaser, and (5) the vendor is not licensed or authorized to be in the business of insurance. See Ware v. Heath, 237 S.W.2d 362 (Tex. Civ. App. 1951) (mandatory clause inserted as a pretext for increasing the allowable amount of interest); Kansas v. Anderson, 195 Kansas 649, 408 P.2d 864 (1966) (clause found to be incidental to the real purpose of the contract); Attorney General v. C.E. Osgood Co., 144 N.E. 371 (Mass. 1924) (cancellation of debt is equivalent to the payment of money by giving the purchaser title to the property upon cancellation). Although not all of the factors listed above have been cited in any one case, we find these factors relevant to our evaluation, but not all are equally determinative.

Here, Dynamic offers debt cancellation as a separate contract and at the option of the purchaser. Dynamic charges a weekly or monthly fee for the contract, and gambles that total losses within the meaning of its contract will cost it less than the amount of fees collected. Because Dynamic is not authorized to be in the business of insurance, each purchaser assumes the risk that Dynamic will not be able to perform under the contract due to the lack of financial reserves should Dynamic go out of business. If Dynamic should become insolvent before all its cancellation contracts terminate on their own terms, the contract holder assumes the risk that either his vehicle will not be “lost” or that, if “lost”, he will forfeit the amount paid for the cancellation contract. Significantly, if Dynamic becomes insolvent, the contract holder will have lost his opportunity for a setoff on the purchase price of another vehicle from Dynamic equal to the salvage value of his “lost” vehicle.

In conclusion, we take note of Dynamic’s reliance on First National Bank of Eastern Arkansas v. Taylor, 907 F.2d 775 (8th Cir. 1990). There, the district court held the National Bank Act protected the First National Bank’s authority to enter debt cancellation contracts, and the contracts did not constitute the “business of insurance” under the McCarran-Ferguson Act. We agree with the Commissioner that this decision is narrowly limited, and involves a federal activity and a matter of federal law. While persuasive, we do not find federal decisions authoritative in cases involving interpretation of state law.

For the reasons stated, we find that the evidence is substantial to support the Commissioner’s decision that the debt cancellation contract offered by Dynamic is an insurance product under the Insurance Code.

Reversed and remanded.

       During appeal of this case, the definition of insurance was amended to § 23-60-102 (Supp. 1993) which presently reads:
      (l)(A)(i) “Insurance” is any agreement, contract or other transaction whereby one party, the “insurer”, is obligated to confer benefit of pecuniary value upon another party, the “insured” or “beneficiary”, dependent upon the happening of a fortuitous event in which the insured or beneficiary has, or is expected to have at the time of such happening, a material interest which will be adversely affected by the happening of such event.
      (ii) A “fortuitous event” means any occurrence or failure to occur which is, or is assumed by the parties to be adversely affected by the happening of such event.
      (B) “Insurance” shall, for purposes of subtitle 3 of title 23, be deemed to include “annuities”, which are agreements by insurer to make periodic payments that continue during the survival of the measuring life or lives under the agreements or for a specified period.

       Dynamic’s administrative assistant testified that administrative costs would be deducted, but offered no suggestion that Dynamic would not make any profit from the sale of these contracts.

       The Arkansas Department of Insurance requires the deposit of adequate financial reserves by regulated insurers.