text:
    Terry McGRAW v. Dalton WEEKS, Jr.
    95-1220
    930 S.W.2d 365
    Supreme Court of Arkansas
    Opinion delivered October 21, 1996
    [Petition for rehearing denied December 12, 1996.]

      Butler, Hicky & Long, for appellant.

      W. Frank Morledge, P.A., for appellant Dalton Weeks, Jr..

      Easley, Hicky, Cline & Hudson, for appellee Billy Joe Stewmon.
   Robert H. Dudley, Justice.

Dalton Weeks, Jr., appellee, filed this tort action for damage to his cotton crop as the result of drifting of the chemical 2,4-D after it was applied to nearby rice fields. A hormone herbicide, 2,4-D is suitable for use in rice fields, but it has a propensity to damage cotton; consequendy, its use is restricted by the Arkansas State Plant Board. In 1991, when appellant Terry McGraw and Billy Jayroe applied 2,4-D to the rice fields, the Plant Board regulations prohibited the application of 2,4-D within one mile of cotton. Appellant McGraw, a farm manager, directed the ground application of 2,4-D to the levies of a rice field that was only one-quarter mile from Weeks’s cotton crop.

The State Plant Board’s regulations in 1991 additionally restricted the aerial application of 2,4-D to licensed aerial applicators. The Board’s licensing process required both testing of the pilot and inspection of the airplane, including checks for leaks within the application system. Jayroe employed Billy Joe Stewmon to make an aerial application of 2,4-D on his rice crop. Neither Stewmon nor his plane were tested or examined by the State Plant Board, and Stewmon was not licensed to apply 2,4-D. In addition, a nozzle on Stewmon’s plane leaked during the application for Jayroe.

Weeks brought this suit against McGraw, Jayroe, and Stewmon. Each denied liability, and each filed cross-claims against the other for indemnity and contribution. After a four-day trial, the jury returned a unanimous verdict of $55,000 in damages to Weeks, unanimously apportioned 75% of the fault for the damage to Stewmon, the aerial applicator, and unanimously apportioned 25% to McGraw, who directed the ground application. By a majority verdict, the jury found no fault on the part of Jayroe, the rice farmer who employed the aerial applicator. The trial court subsequently entered judgment against McGraw and Stewmon jointly and severally. McGraw appeals. There is no reversible error, and we affirm.

McGraw’s first assignment is that the trial court erred in ruling that he and Stewmon were jointly and severally liable. He argued to the trial court that the jury’s conclusion that he was 25% responsible and Stewmon was 75% responsible was not supported by substantial evidence because the proof showed that he caused injury to slightly less than fifty acres, while Stewmon damaged the remaining 150 acres. The trial court found that, even though each tortfeasor’s act or negligence might not have caused all of the damage, they combined to produce, for the most part, a single injury, and each was responsible for the entire result.

Much of McGraw’s argument on appeal is premised on the theory that joint tortfeasors must act in concert for joint and several liability to attach, but that is not the law in Arkansas. Consequently, McGraw’s citations to numerous cases from other jurisdictions do not afford him relief. We have long said that it is not necessary that the parties be acting in concert in order to be jointly and severally liable. Applegate v. Riggal, 229 Ark. 773, 318 S.W.2d 596 (1958). In this state, joint and several liability is measured by impact, and where there is a single injury, it does not matter whether the individual acts alone would not have caused the entire result. Woodward v. Blythe, 249 Ark. 793, 462 S.W.2d 205 (1971). The case of Van Troop v. Dew, 150 Ark. 560, 234 S.W. 992 (1921), is instructive. In that case, some farmers sued construction contractors and subcontractors who were responsible for a broken fence that allowed cattle to enter their land and destroy their crops. Id. at 562, 234 S.W. at 993. Joint and several liability was imposed on the contractors by the trial court. Appellant Van Troop argued on appeal that he caused only one gap in the fence, which he closed in a few days, while some of the other defendants made various gaps in the fences and made no effort to repair or guard them. Id. at 561, 234 S.W. at 994. We affirmed the trial court and, in pertinent part, wrote:

[T]here is joint liability where the different acts of negligence concur as to time and place and unite in setting in operation the force which causes the injury. In other words, they used the open gaps for the same purposes and at the same time, each being under duty to repair the gaps, and the conduct of each resulted in admission into the field of large numbers of cattle. It cannot be said that the entrance of the cattle was the result of the separate acts of either, but it was rather the result of the act of both of the parties in failing to repair the gaps so as to keep the cattle out.

Id. at 565, 234 S.W. at 994. In the case at bar, the damage to Weeks’s cotton crop was the result of the acts of both McGraw and Stewmon in negligently applying 2,4-D, and the trial court ruled that it was impossible to determine in what proportion each contributed to the damages.

McGraw also argues that the damage to Weeks’s cotton crop was divisible. The trial court’s finding necessarily implied that the damage was indivisible, and we affirm that finding because it was not clearly erroneous. Earnest Hill, who was employed by the State Plant Board in 1991, testified that he was unable to state with any degree of certainty how many acres McGraw’s applications damaged and he could not say how many acres Stewmon’s application damaged. He was then questioned about a report he prepared that referred to fifty-seven acres and one hundred acres. He responded that the fifty-seven acres in his inspection report referred to the rice sprayed by McGraw, and the one hundred acres to the rice sprayed by Jayroe, not to the damage to Weeks’s cotton. Stewmon’s expert, Lee Frazier, testified that the drifts overlapped. One of the questions asked Frazier and his response are as follows:

Q. No, I’m not asking you where they were. Maybe my question wasn’t asked. As to what was where, whatever was there, you can’t separate it as to where one starts and one stops.
A. No, Sir. All those applications were made generally in the same time frame. Had there been some time difference between the applications you may have been able to separate what came from what application. What happens on a cotton plant if you get two real close applications it all looks like the same symptoms. If you get one exposure the cotton plant has a chance to recover and starts to put on normal leaves. Then you get another exposure so then you’ve got heavy symptoms, like symptoms, or no symptoms, and then heavy symptoms again. All these applications were apparently within the same time frame, ten or twelve days there, and the cotton plant just didn’t have enough time to recover and put on new leaves in between.

Thus, the trial court’s ruling that the damage to Weeks’s cotton crop was one injury was not clearly erroneous. The trial court correctly applied the law of joint and several liability.

McGraw’s next point of appeal is composed of three subpoints and comes about as follows. Over McGraw’s, Stewmon’s, and Jayroe’s objections, Weeks testified that, if not for the damage to his cotton crop, he would have contracted in June for the sale of his cotton at sixty-eight cents per pound for future delivery. Because the trial court allowed the testimony in evidence, McGraw, Stewmon, and Jayroe asked the trial court to modify the A.M.I. crop damage instructions, A.M.I. Civ. 3d 2220, 2221, and 2225. They asked that the principle implicit in the Model Instructions, that the relevant time for valuing a marketable crop is “at the time of the harvest,” be made explicit. The trial court refused to add the phrase “at the time of harvest” to the instructions. Weeks testified about the history of the cotton yield for the field in which the damage occurred and, on rebuttal, testified about the yields for three years after the damage. On appeal, McGraw renews his objection to (1) the testimony about the price at which Weeks “would” have contracted to sell his cotton, (2) the refusal to modify the A.M.I. instructions, and (3) the yield-history proof.

We need not decide McGraw’s first subpoint about Weeks’s testimony that, except for the damage, he would have booked his cotton in June at sixty-eight cents per pound. The jury awarded Weeks $55,000, and that award was clearly based on a price of 53.6 cents per pound, the price Weeks received in the fall on the open market for cotton grown and harvested on a nearby undamaged field. Thus, the testimony about the futures contract, even if erroneously admitted, could not have harmed McGraw.

We treat McGraw’s second subpoint, the one concerning modification of the Model Instructions, similarly. All parties agree that Weeks’s cotton crop was damaged, but marketable. Arkansas law provides that when a crop is damaged but nonetheless grows to maturity, the damages are the difference between the market value, at the time of harvest, of the crop actually produced and the crop that would have been produced without the damage, less the costs of production. St. Louis Southwestern Ry. Co. v. Morris, 76 Ark. 542, 89 S.W. 846 (1905); Howard Brill, Arkansas Law of Damages, § 32-4 at 426-27 (2d ed. 1990). The Model Instructions recognize that the open market determines the price and that the time of harvest is the critical date for valuation of a marketable but damaged crop. The Model Instructions, as adapted to this case, provided that “fair market value” meant the difference between “the price that the cotton of Dalton Weeks would bring on the open market” and the “fair market value...[of] the crop actually produced” less the costs “to produce, harvest, and market the crop.” A.M.I. Civ. 3d 2220 & 2225. Obviously, the jury understood these instructions to mean that the open market at the time of harvest was the critical price and date for valuation because the award was based on 53.6 cents per pound, the price Weeks received on the open market after harvest for cotton from an undamaged and adjoining field.

The above two subpoints were extensively discussed in our decisional conference. The testimony at trial and the oral arguments before us have impressed upon us the fact that farmers today often make commitments for future delivery of commodities. We have some concern that our Model Instructions make no distinction between the traditional “spot” price for commodities on the “open” market and a “futures” contract. The “spot” price for cotton and other commodities and the “cash” price for grains on the “open” market are the prices assumed to determine fair market value by the Model Instructions. These prices are sometimes called the “actuals” and mean the price when the commodities are ready for immediate delivery. John Downes and Jordan Elliot Goodman, Barron’s Finance and Investment Handbook, at 27-30, 133-34, 491 (3d ed. 1990). In past years, the “open” or “spot” price was the only one available to the producing farmers and is the only price discussed in our seminal case on such damages. See St. Louis Southwestern Ry. Co. v. Morris, 76 Ark. 542, 89 S.W. 846 (1905). However, today, the “futures contract” is often employed by the producers of commodities. Through the use of a futures contract, or “booking,” the producer of a commodity can make a commitment to sell a specified quantity of a commodity at a specified price during a particular delivery month. Downes and Goodman, supra. In this way a farmer can hedge the position in his underlying crop. He can use a futures contract to create a countervailing position and thus protect against loss due to price changes. A farmer might book 100 bales of cotton in June for delivery in November at seventy cents per pound. The farmer knows that he will make a profit at that price and knows that, without any real question, in November he can deliver 100 bales of cotton, which is converted into a fixed number of pounds. Under this hypothetical illustration, the farmer, by hedging, has fixed his profit. If the spot price should be lower in November, the farmer does not suffer the lower price. On the other hand, if the spot price is higher in November, the farmer does not get the higher price.

Today there are occasions when “booking” prices should be admissible in evidence. Many factors must be weighed before a trial judge allows such evidence because of the possibility that it would amount to speculation. It would amount to nothing more than conjecture to allow a farmer who had never booked a commodity and who did not have an irrigation system that would assure a certain amount of production to testify that he “would have” booked a commodity. On the other hand, a futures price might be allowed in evidence for a farmer who has a consistent history of production of a commodity and customarily books at a particular time of the year. Because of this changing practice of producers to utilize futures prices, we ask our Committee on Model Jury Instructions — Civil to look into the appropriateness of modifying or adding an instruction on futures fair market value to the current Model Instructions.

In his third subpoint, McGraw contends that the trial court erred in allowing Weeks to testify about his yields per acre in years subsequent to the year of loss. The short answer to the argument is that the trial court allowed the evidence, not as a measure of damages, but to rebut McGraw’s claims that the field was not suited to the growing of cotton. As such, it was not error to allow the testimony.

McGraw’s next assignment of error involves a ruling by the trial court that Lee Frazier, Stewmon’s expert witness, could remain in the courtroom during the trial even though McGraw had asked that “the rule” be invoked. Stewmon gave notice that the expert witness’s opinion would be partially based upon trial testimony. Rule 615 of the Arkansas Rules of Evidence provides that the trial court “shall” exclude witnesses from the courtroom when requested, Blaylock v. Strecker, 291 Ark. 340, 724 S.W.2d 470 (1987), but the rule also provides three exceptions, one of which is for “a person whose presence is shown by a party to be essential to the presentation of his cause.” Ark. R. Evid. 615(3). Under this exception a party must show that the witness would be unable to present essential testimony without hearing the actual testimony of other witnesses, or that the witness has such specialized expertise or intimate knowledge of the facts of the case that a party’s attorney could not effectively function without the presence and aid of the witness. Oliver B. Cannon & Son, Inc. v. Fidelity & Casualty Co., 519 F. Supp. 668 (D. Del. 1981). Here, the trial court ruled that Stewmon made a sufficient showing that the expert would be unable to present essential testimony without hearing the testimony of other witnesses. The standard of appellate review is whether the trial court abused its discretion. Martin v. State, 22 Ark. App. 126, 726 S.W.2d 287 (1987). We cannot say the trial court abused its discretion in the ruling.

McGraw next contends that the trial court erred in allowing the jury to view the fields. Arkansas Code Annotated section 16-64-113 (1987) provides that the trial court may allow the jury to visit the place where the material fact of a trial occurred, and we have said that jury visits to a relevant site are within the discretion of the trial court. Arkansas State Highway Comm’n v. Carder, 228 Ark. 8, 305 S.W.2d 330 (1957). Here, the trial court did not abuse its discretion in allowing the jury to visit the place where the material facts took place.

McGraw’s next assignment is that the trial court erred in refusing to grant a directed verdict in his favor. At the close of all of the evidence he moved for a directed verdict on the ground that he was not the owner of the rice farm on which he directed the application of 2,4-D; rather, Eugene McGraw Farms, Inc., which was not a party to the lawsuit, was the owner, and the employee who did the spraying was the corporation’s employee, not his. McGraw was the farm manager for Eugene McGraw Farms, Inc. Further, he argued that the ultimate decision to spray was not his, but was Norris Powell’s, and Powell was not a party to the suit. McGraw makes the same arguments on appeal.

When it can be shown that an individual employed by a corporation is personally involved in the events surrounding an injury, the individual may be sued. Cash v. Carter, 312 Ark. 41, 847 S.W.2d 18 (1993). Here there was sufficient evidence to show that McGraw was personally involved. McGraw supervised and ran the farming operations of Eugene McGraw Farms, Inc. He made the decision to apply 2,4-D to the levies in the rice field that belonged to Eugene McGraw Farms, Inc. He instructed Norris Powell, an employee of the corporation, to apply the chemicals. His testimony is abstracted as follows: “I told my employee what to put out, when to put it out, where, how to mix it and even what gear to drive the tractor in.” He admitted that he did not know that the State Plant Board regulations had been amended to provide that the use of an anti-drift agent was required when spraying within one mile of cotton. He admitted that he did not direct the use of an anti-drift agent. He admitted that he knew that 2,4-D was “the death of cotton.” He admitted that applications were made on “several mornings and one afternoon.” He admitted that he knew that his neighbor Weeks had cotton on his land, but denied knowing the distance to Weeks’s field. Other testimony established that the rice field and Weeks’s cotton field were only 440 yards apart. Powell, the employee who applied the 2,4-D, testified that McGraw directed him to apply it. Powell’s testimony, in part, was as follows:

Q. What did you say?
A. Nothing. I went and sprayed it. I was following orders.
Q. Whose orders?
A. Terry McGraw.

On cross-examination Powell testified that if he had gotten up in the morning and if the wind was blowing in the direction of the cotton, he would not have sprayed it at that time, and that he could have made that decision on his own. McGraw latches onto this statement in cross-examination and, because of it, contends that the judgment to spray was made by Powell, not him; therefore, there was insufficient evidence that he directed the application of the chemical and proximately caused the damage to the cotton crop. The argument does not prevail. The above facts, and all the reasonable inferences from them, created a question for the jury. Proximate cause is usually an issue for the jury to decide, and when there is evidence to establish a causal connection between the negligence of the defendant and the damage, it is proper for the case to go to the jury. Skinner v. R.J. Griffin & Co., 313 Ark. 430, 855 S.W.2d 913 (1993). Here, there was testimony that drifting chemicals caused the damage and that McGraw ordered the spraying without knowing how close the cotton was.

McGraw’s final argument is that the court should have modified A.M.I. Civ. 3d 709 by substituting Jayroe’s name in place of “employer” and Stewmon’s name in place of “independent contractor.” Model Instruction 709 states that an employer is under a duty to select a competent independent contractor. He contends that the instruction misled the jury into thinking that he was responsible as a matter of law for the negligence of Powell. The argument is without merit since no one sought a verdict against McGraw under the doctrine of respondeat superior. Rather, one interrogatory inquired about McGraw’s personal negligence, and another inquired whether Stewmon was the agent of Jayroe. There simply was no basis for the jury to find that McGraw was liable under the doctrine of respondeat superior. Instructions are not to be viewed in isolation, but are to be considered as a whole to determine whether the law applicable to a case is correctly declared. Porter v. Lincoln, 282 Ark. 258, 668 S.W.2d 11 (1984). The other instructions make the issue clear. Id.

Affirmed.


source: Caselaw Access Project

author: Robert H. Dudley, Justice.

license: Public Domain

text:
    Emmett SIMS, Jr. v. STATE of Arkansas
    95-1228
    930 S.W.2d 381
    Supreme Court of Arkansas
    Opinion delivered October 21, 1996

      McLean Law Firm, by: William A. McLean, for appellant.

      Winston Bryant, Att’y Gen., by: Clint Miller, Deputy Att’y Gen., Sr. Appellate Advocate for appellee.
   Robert H. Dudley, Justice.

The issue in this case is whether the State is attempting to twice punish Emmett Sims, Jr., for the same offense in violation of the Double Jeopardy Clause of the United States Constitution. The trial court held that Sims was not twice punished for the same conduct. We affirm the judgment.

On April 16, 1994, after a car chase, a state trooper forced Sims’s car off the road in order to arrest him. The trooper searched Sims and found he was in possession of a .38 caliber pistol and $8,603.96. During the chase, the trooper had seen Sims pitch a crumpled piece of paper out of his car window. After the arrest was completed, the trooper went back to the area where he had seen Sims throw out the crumpled paper and found one syringe containing cocaine, two additional syringes, and 3.143 grams of crack cocaine inside the crumpled paper. The State filed an information that charged Sims with possession of controlled substances with intent to deliver.

On July 29, 1994, the State filed this civil case, a forfeiture action in rem against the $8,603.96, under authority of Ark. Code Ann. § 5-64-505 (Repl. 1993). Sims’s attorney requested notice of a forfeiture action. Sims, by his attorney, filed an answer denying that Sims was in possession of controlled substances and claiming the money. On December 13, 1994, Sims, in the criminal case, pleaded guilty to the crime of possession of controlled substances with the intent to deliver and was sentenced.

On April 27, 1995, Sims filed a motion to dismiss this in rem civil action on the ground that it would be a violation of the Double Jeopardy Clause to forfeit his money after he had been sentenced for the same criminal offense. The trial court denied the motion and ordered the money forfeited. Sims appeals.

Sims’s sole argument is that the forfeiture of the $8,603.96 amounted to double jeopardy because he had been previously punished for the same conduct upon which the forfeiture was had. Both Sims and the State rely on cases from United States Courts of Appeals. At the times their briefs were filed, there was a split of authority among the United States Courts of Appeals as to whether civil forfeitures were violative of the “multiple punishment” prong of the Double Jeopardy Clause. See Nancy J. King, Portioning Punishment: Constitutional Limits on Successive and Excessive Penalties, 144 U. Pa. L. Rev. 101, 117-25 (1995). However, after the briefs were filed, the Supreme Court setded the conflicting viewpoints in the consolidated case of United States v. Ursery, 116 S. Ct. 2135 (1996). In Ursery the Court held that civil forfeitures did not impose “punishment” for double jeopardy purposes and that an in rem civil forfeiture is not an additional penalty for the commission of a criminal act, but rather is a separate civil action that is remedial in nature. The heart of the holding is that a two-part test must be used to determine whether a forfeiture is “punishment” for double jeopardy purposes. That test first asks whether the General Assembly intended the particular statute at issue to be a remedial civil sanction or a criminal penalty, and second, whether the forfeiture proceedings are so punitive in fact as to establish that they may not legitimately be viewed as civil in nature, despite any legislative intent to establish a civil remedial mechanism.

We now turn to the first part of the test, which is whether the General Assembly intended Ark. Code Ann. § 5-64-505 to be a remedial civil sanction or a criminal penalty. This statute is part of a subchapter on the enforcement and administration of the Uniform Controlled Substances Act. In general, the subchapter is remedial. It provides for the forfeiture of all money and property used or intended to be used to facilitate a violation of the Controlled Substances Act. The statute refers to the Arkansas Rules of Civil Procedure. The proceedings are governed by the rules of civil procedure, and the burden of proof lies upon the claimant. Limon v. State, 285 Ark. 166, 685 S.W.2d 515 (1985). It provides for actions in rem, and actions in rem have traditionally been viewed as civil proceedings. Scienter is not required before forfeiture can be ordered. The subsection used in this instance provides for educational programs designed to prevent and deter misuse and abuse of controlled substances. Ark. Code Ann. § 5-64-508. However, some sections have markings of a criminal sanction. Arkansas Code Annotated § 5-64-505(m) provides for in personam forfeiture based upon a person’s conduct. In sum, we cannot say that the General Assembly has clearly indicated that all parts of the statute provide civil, and not criminal, sanctions.

As a result of our finding, we must examine the manner in which the statute was applied in this case. We have no hesitancy in holding that the statute was applied as a civil sanction. This suit was filed under the in rem provisions of the statute; it was filed against the money. The statute provides that notice to an individual is not necessary in all instances. The burden of proof was governed by the rules of civil procedure, and the burden was upon the claimant. The statute, as applied, had none of the makings of punishment.

We turn now to the second stage of analysis, and there is little evidence, much less the “ ‘clearest proof’ ” required by United States v. Ursery, suggesting that these forfeiture proceedings were so punitive in form and effect as to render them criminal. Forfeiture proceedings against property used to commit drug violations encourages owners to take care of property and ensures that it is not used in the drug trade. Forfeiture of property prevents illegal uses by imposing an economic penalty, thereby rendering illegal behavior unprofitable. Finally, to the extent that the statute applies to the proceeds of illegal drug activity, it serves the additional nonpunitive goal of ensuring that persons do not profit from their illegal acts. See United States v. Ursery, 116 S. Ct. at 2149.

We affirm the trial court and hold that the in rem civil forfeiture was neither “punishment” nor criminal for purposes of the Double Jeopardy Clause.

Affirmed.


text:
    TYSON FOODS, INC. v. Steve ADAMS
    95-969
    930 S.W.2d 374
    Supreme Court of Arkansas
    Opinion delivered October 21, 1996

      The Perroni Law Firm, P.A., by: Samuel A. Perroni and Rita S. Looney, for appellant.

      Davis, Cox & Wright, by: Walter B. Cox and Tim E. Howell, for appellee.
   Robert H. Dudley, Justice.

This is another in the recent series of legal malpractice suits. In this one, Steve Adams, the attorney, agreed to represent Tyson Foods, Inc., in two separate underlying actions: one was to quiet tide to a tract of land in Pope County, and the other was to defend a foreclosure action involving the same land. Both cases were removed to Federal District Courts for the Eastern District of Arkansas, the quiet-tide action to the court of District Judge Henry Woods and the foreclosure action to the court of District Judge Susan Wright. Adams was negligent in his representation of Tyson in both cases. In the quiet-tide action, he failed to respond to motions for summary judgment and failed to notify Tyson that judgment had been entered against it; in the foreclosure suit, he failed to respond to motions and failed to notify his client that the property was about to be sold. Tyson subse-quendy filed this malpractice action against Adams in the Circuit Court of Washington County. The Honorable David Burnett, circuit judge on exchange, ruled on summary judgment that Adams was negligent, but that such negligence was not the proximate cause of damage to Tyson. We affirm the ruling.

In 1982, Valmac Industries, Inc., a poultry producer, needed a larger freezer facility to store its poultry products in Russellville. Valmac was short of capital because of its rapid growth. In addition, interest rates were high, approximately 15%, and so Valmac decided to finance the expansion by using a sale and leaseback with an option to purchase. This way, Valmac could use someone else’s capital to build the facility. Valmac reached agreement with Sat-terfield Development, Inc., a Russellville builder, for the sale and leaseback with an option to purchase. In performance of that agreement, Valmac deeded the land on which the freezer was located to Satterfield Development. The consideration recited in the deed was $166,000, Valmac’s book value, which was considerably less than the facility’s market value. Satterfield Development then leased the property back to Valmac and gave it an option to purchase. The consideration recited in the lease was $49,000 per month through March 1, 1988, and, at that time, Valmac had the option of purchasing the facility at its fair market value. Valmac employed an outside attorney to give an opinion on the validity of the lease and option. Upon review of the deed, lease, and purchase agreement, the attorney gave his opinion that the lease and option was a valid lease and was not voidable under the then-existing usury laws. Valmac’s Board of Directors authorized the transaction by resolutions dated August 19 and 23, 1982.

On August 30, four days after the lease and option were executed, Valmac and Satterfield Development, through Blake Lovett, president of Valmac, and George Satterfield, president of Satterfield Development, signed a separate letter agreement. Lovett testified by deposition that the letter agreement was signed as the result of a side agreement he and George Satterfield had previously entered. In the side agreement the option price was fixed at $68,660, but was to be adjusted according to whether the federal discount rate, plus 5%, averaged more or less than 17% during the final thirty-six months of the term of the lease. Lovett explained that the agreement meant that the real option price was the difference between the amount paid in monthly rentals and the cost of construction plus the cost of interest, and that the option price was never intended to be an amount equal to the fair market value of the facility, as stated in the lease. Lovett testified that the side agreement was not disclosed so that Valmac could deduct the lease payments according to the terms of the original lease, rather than capitalizing them as required by tax laws and generally accepted accounting principles, and so that Valmac could avoid violation of the then-existing usury laws. Valmac also wanted to avoid disclosing the side option price because it was in violation of covenants with its bank regarding asset and liability ratios. The side agreement was not disclosed to Valmac’s independent counsel, its auditors, or its bank. Lovett testified that he “understood that if the agreement was disclosed that there would be consequences that might arise from the agreement.”

Satterfield Development completed construction of the expansion, and beginning in March 1983, Valmac paid monthly rent to Satterfield Development. Valmac treated the lease as such and deducted the lease payments as made rather than capitalizing them. In October 1984, Tyson acquired approximately 80% of Valmac’s common stock and at about the same time, as the successor-in-interest, began operating the freezer facility and making the rental payments to Satterfield Development. A formal merger of Valmac and Tyson took place on July 1, 1987. During meetings leading up to the acquisition of Valmac by Tyson, Lovett disclosed to Leland Tollett, president of Tyson, that the agreement with Satterfield was a “finance-type lease.” Tollett, by deposition, testified that Lovett told him there was an agreement by which Valmac would obtain tide to the property, and the formula for calculation of price was “based on an interest rate calculation.”

In 1985, George Satterfield decided to build a large sawmill that was to be owned and operated by another of his corporations, Satterfield Lumber Company. Satterfield needed to borrow a considerable amount of money to construct such a large mill. On December 10, 1985, Savers Federal Savings and Loan Association extended a $1,600,000 loan to Satterfield and Satterfield Lumber Company. As part of the security for the loan, Satterfield, as president of Satterfield Development, executed a mortgage on the freezer property to Savers. In obtaining the loan from Savers, Sat-terfield provided Savers a copy of the lease and option agreement with Valmac. He did not disclose the side agreement to Savers. Satterfield constructed the sawmill and put it into operation, but soon began to lose money and fell behind in his payments to Savers. Savers notified Satterfield that it was considering its options, including foreclosing on the freezer property. The freezer property had a true market value of more than $2,000,000, as it was appraised in 1982 as having a fair market value of $2,900,000 and in 1990 as having a fair market value of $2,700,000 without the lease and $2,060,000 with the lease.

In 1988, Tyson attempted to exercise its option to purchase the freezer according to the terms of the August 30, 1982, side agreement, the one providing that the purchase price was $68,660, with adjustments for construction costs and interest. Ironically, under this agreement, Satterfield Development owed Tyson upon Tyson’s exercise of the option to purchase. Under the terms of the side agreement, Satterfield owed Tyson $169,298, less the agreed option price of $68,660, or a net of $100,638. Satterfield Development owed this amount because interest rates had fallen dramatically during the term of the lease. Satterfield eventually disclosed to Tyson that Satterfield Development could not convey clear title because the property had been mortgaged to Savers. Satterfield Development, Satterfield Lumber, and Tyson entered into various agreements in attempts to clear tide, but all failed. Tyson and Satterfield Development executed a lease extension on June 1, 1988. Shortly thereafter, the original lease and option agreement, along with the lease extension, were recorded in the records of Pope County. During the late 1980’s, Savers encountered its own capital problems and was taken over by the Resolution Trust Corporation under federal law.

Tyson employed Adams to file suit for specific performance of the side agreement and to quiet tide. On May 19, 1989, Adams, on behalf of Tyson, filed the suit in the Chancery Court of Pope County against Satterfield Development, Satterfield Lumber, and Savers. The R.T.C. subsequently replaced Savers and caused the action to be removed to United States District Court. After removal, the R.T.C. filed a motion for summary judgment. Adams failed to respond on behalf of Tyson, and District Judge Henry Woods granted the motion dismissing the R.T.C., but not the other defendants. The primary basis of Judge Wood’s ruling was that Tyson and its predecessor in interest could not rely on the secret side agreement under the D’Oench, Duhme doctrine. Adams failed to notify Tyson that the R.T.C. had been granted a summary judgment.

The R.T.C. initiated the foreclosure action against Satterfield Development and others on July 22, 1991. Tyson was made a party because of its claim to the property. Adams failed to respond for Tyson. The Honorable Susan Wright, United States District Judge, ruled that the R.T.C.’s interest was prior to all other interests in the property, including Tyson’s, and entered a decree of foreclosure in favor of the R.T.C. Judge Wright relied on the ruling by Judge Woods in making her decision.

Tyson employed new counsel, David Duke, who filed motions for reconsideration in both cases. Both federal district judges denied the motions, with Judge Wright stating that, in addition to other reasons for her original ruling, Savers, and, in turn, the R.T.C., was a bona fide purchaser for value and was without notice of Tyson’s claim to the property. Judge Wright also indicated that Savers and the R.T.C. had no duty to inquire about Tyson’s possession since it was consistent with the lease and option agreement submitted to Savers at the time the loan was made. Judge Wright also stated that Adams’s negligence did not affect the outcome of the case since it was determined by facts that took place before Adams was employed. Tyson appealed the judgment in the foreclosure action and ultimately setded it by paying the R.T.C. a sum of $600,000.

Tyson then filed this suit against Adams in the Circuit Court of Washington County. The circuit judge granted Adams’s motion for summary judgment, finding that there were no genuine issues of material fact and that Adams’s negligence was not a proximate cause of damage to Tyson because Tyson could not have prevailed on the underlying cases. Tyson appeals from the granting of summary judgment by the circuit court.

Indubitably, Adams was negligent in his representation of Tyson in both of the underlying suits. As a result, all Tyson had to prove in order to recover was that it was damaged and that Adams’s negligence was a proximate cause of those damages. Anthony v. Kaplan, 324 Ark. 52, 918 S.W.2d 174 (1996). On summary judgment, the circuit court ruled that Tyson could not have prevailed on the underlying causes of action; therefore, it could not prove proximate cause. Tyson takes issue with both the procedure and the substance of the ruling by the trial court.

I. Procedure

Tyson questions the determination of proximate by means of summary judgment. Summary judgment is to be granted by a trial court when it is clear that there is no genuine issue of material fact to be litigated, and, on appellate review, the appellate court determines if the granting of summary judgment was appropriate based on whether the evidentiary items presented by the moving party in support of the motion leave a material question of fact unanswered. Knowlton v. Ward, 318 Ark. 867, 889 S.W.2d 721 (1994). While the question of proximate cause is usually a question for the jury, when the evidence is such that reasonable minds cannot differ, the issue becomes a question of law to be determined by the trial court. Skinner v. R.J. Griffin & Co., 313 Ark. 430, 855 S.W.2d 913 (1993). The granting of summary judgment can be appropriate in a legal malpractice suit. Anthony v. Kaplan, supra. Here, there was no question of material fact to be determined, and the evidence was such that reasonable minds could not differ about proximate cause. Thus, the trial court correcdy granted summary judgment.

II. Substantive Law

Tyson contends that the circuit judge erred in granting the summary judgment because it could have prevailed in the underlying causes of action. In support of its argument it contends that: (1) United States District Judge Woods erred in ruling on the quiet tide action and (2) United States District Judge Wright erred in ruling on the foreclosure action.

(1)

Tyson argues that Judge Woods erroneously applied the D’Oench, Duhme doctrine and that the circuit judge, by granting summary judgment, failed to acknowledge the error. In his memorandum opinion and order, Judge Woods concluded that Tyson, the successor to Valmac, was estopped from relying on the side agreement to establish its right to the property against the R.T.C.

In 1942, the United States Supreme Court held that an agreement that was not expressly reflected on the face of a loan document was unenforceable against the Federal Deposit Insurance Corporation. The Court examined the statutory scheme that created the F.D.I.C. and concluded that it evidenced a “federal policy to protect... [the F.D.I.C.] and the public funds which it administers, against misrepresentations as to...the assets in the portfolios of the banks which...[the F.D.I.C.] insures or to which it makes loans.” D’Oench, Duhme & Co. v. F.D.I.C., 315 U.S. 447, 457 (1942). In order to give effect to this federal policy, the Court fashioned a common law rule of estoppel that precludes a borrower from asserting defenses against the F.D.I.C. based upon secret or unrecorded “side agreements” that alter the terms of facially unqualified obligations. The doctrine was expanded to protect the Federal Savings and Loan Insurance Corporation from undisclosed agreements in Mainland Savings Ass’n v. Riverfront Associate, Ltd., 872 F.2d 955, 956 (10th Cir. 1989), cert. denied, 493 U.S. 890 (1989). The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 abolished the F.S.L.I.C. and created the R.T.C. as receiver. Pub. L. No. 101-73, § 501, 103 Stat. 183, 363, 370 (1989). The D’Oench, Duhme doctrine has been extended to the R.T.C. See Castleglen, Inc. v. Commonwealth Sav. Ass’n, 728 F. Supp. 656 (D. Utah 1989). The doctrine has evolved expansively to protect the F.D.I.C. against affirmative claims by third parties based upon unrecorded agreements. See Royal Bank of Canada v. F.D.I.C., 733 F. Supp. 1091, 1096-97 (N.D. Tex. 1990). “It is entirely consonant with the Fifth Circuit’s interpretation of D’Oench, Duhme to apply the rule outside the lender-borrower framework, so long as the party seeking to recover must rely upon a scheme or arrangement likely to mislead bank examiners.” Id. at 1097; see also Bell & Murphy & Assocs., Inc. v. Interfirst Bank Gateway, N.A., 894 F.2d 750, 753-54 (5th Cir. 1990).

In 1989, Congress enacted many of the provisions of the common law doctrine. The codification, in material part, provides:

No agreement which tends to diminish or defeat the interest of the Corporation [.R.T.C.] in any asset acquired by it under this section or section 1821 of this title, either as security for a loan or by purchase or as receiver of any insured depository institution, shall be valid against the Corporation unless such agreement—
(A) is in writing,
(B) was executed by the depository institution and any person claiming an adverse interest thereunder, including the obligor, contemporaneously with the acquisition of the asset by the depository institution,
(C) was approved by the board of directors of the depository institution or its loan committee, which approval shall be reflected in the minutes of said board or committee, and
(D) has been, continuously, from the time of its execution, an official record of the depository institution.

12 U.S.C. § 1823(e) (1984) (emphasis supplied).

Under the facts of this case it does not matter whether we decide it under the common law doctrine or the statute enacted in 1989, a point not argued. See O’Melveny & Myers v. F.D.I.C., 114 S. Ct. 2048 (1994) (holding that court-made rules are preempted by comprehensive, detailed statutory schemes); Murphy v. F.D.I.C., 61 F.3d 34 (D.C. Cir. 1995) (interpreting O’Melveny & Myers as implicitly holding that FIRREA preempts the D’Oench, Duhme doctrine).

In the quiet-tide action, Judge Woods found:

The undisputed facts establish that Valmac, and later Tyson, lent themselves to a scheme or arrangement whereby banking authorities were likely to be misled. Without knowledge of the side agreement, Savers made a 1.6 million dollar loan to Satterfield Lumber Company and George Sat-terfield. As part of the security for this loan, Satterfield Development, which held tide to the freezer, provided Savers with a mortgage on the property. It was not until Tyson expressed its intent to exercise its option to purchase the freezer for the sum set forth in the side agreement that Savers became aware of the agreement. Tyson cannot now enjoy the benefit of this agreement because to do so would cause the RTC to lose a significant portion of the security supporting the 1.6 million dollar loan. Thus, Tyson is estopped form litigating the validity of the agreement.

After Tyson filed its motion for reconsideration, Judge Woods again concluded that summary judgment was appropriate, as follows:

The court has re-examined the order in light of the matters addressed in this motion. Despite the assertions contained in the motion, the court finds that the disposition of the R.T.C.’s motion for summary judgment was correct.

Tyson argues that Judge Woods erred, and, consequently, the trial court erred in granting summary judgment because a material question of fact existed about whether the side agreement was a secret agreement or whether it was a subsequent modification by letter of the original agreement. The argument is without merit for either of two reasons. First, Lovett testified that he and Satterfield openly entered into the sale and leaseback with option to purchase, and kept secret the side agreement, in order to avoid disclosing violations of the usury law and violations of capital requirements to Valmac’s bank and so that Valmac could fully deduct the lease payments, rather than capitalizing them, for income tax purposes. Tollett acknowledged that Lovett disclosed that there was a “finance-type lease” and that the option price was set by a “formula based on an interest rate calculation.” Thus, reasonable minds could not differ; the side agreement was a secret side agreement and not merely a modification of the original agreement. Second, the side agreement was not disclosed to Savers. Under these circumstances, Valmac and its successor-in-interest, Tyson, were properly prevented by the doctrine from enjoying the benefits of the secret agreement that would have defeated a significant part of Savers’s and the R.T.C.’s security, at the expense of the public.

Tyson next contends that Judge Woods erred in applying the doctrine to it, since it was merely a third party. This argument is without merit for any of three reasons. First, the doctrine extends not only to knowing participants in schemes, but also to parties that are ignorant or ill-informed of the transaction and who did not intend to deceive anyone. D’Oench, Duhme, 315 U.S. at 458-59; Bell & Murphy & Assocs., Inc., supra. Second, Tyson knew the lease was a “finance-type lease” and that the option price was fixed on a “formula based on an interest rate calculation,” rather than the fair market value. Third, Tyson is the successor-in-interest of Valmac and stood to gain by Valmac’s misleading Savers.

Tyson argues that Judge Woods erred in applying the doctrine because Tyson was not notified by Savers that it held a mortgage on the leased property. The short answer to this argument is that Savers was led by the sale and leaseback and option agreement to believe that Valmac, and later Tyson, was a lessee of the property owned by Satterfield Development. Again, there was no dispute of material fact, and reasonable minds could not differ.

In summary, Judge Woods, and subsequendy the circuit judge in this action, ruled correctly in applying the D’Oench, Duhme doctrine. The facts that caused the application of the doctrine occurred before Tyson employed Adams to file the quiet-tide action. Thus, Adams’s negligence in prosecuting the action were not the proximate cause of damage to Tyson.

(2)

Tyson contends that Judge Wright erred by ruling in favor of the R.T.C. in the underlying foreclosure action and that the circuit court similarly erred in granting summary judgment. Judge Wright ruled that the R.T.C.’s interest was superior to Tyson’s interest on the ground that Judge Woods had “held that this interest could not be asserted to defeat the interest of the R.T.C.” Tyson subsequendy filed a Rule 60(b) motion for reconsideration. Judge Wright’s comments in ruling on that motion are abstracted in the supplemental abstract as follows:

Therefore, I have reviewed parts of that file including Judge Woods’s order, and I have looked, in other words, at the merits of the case, and I find that Judge Woods reached a correct conclusion in granting summary judgment and, therefore, I reached a correct conclusion granting summary judgment in the foreclosure decree.
In my opinion, the failure of Mr. Adams to file a response to the respective motions for summary judgment did not result in anything worse for Tyson than happened anyway. I do not think it would matter. That is my opinion. I think the result, even if he had filed a responsive pleading to that motion for summary judgment in my case or in Judge Woods’s, the result would have been the same. An let me tell you for the record that that’s my opinion.
I have no opinion concerning why the side agreement was entered into. I am not expressing whether I think that is a good idea or a bad idea. I do note, however, that in the pleadings in Judge Woods’s Court, Tyson says that it all along considered itself to be the owner of tract 7. If it considered itself to be the owner of tract 7, by golly, it should have known to record its interests of record to protect itself from any bona fide purchasers, including Savers.

Any first year law student knows that if you claim an ownership interest in property, you need to record it to protect your interests against bona fide purchasers. Tyson, for its own reasons, recorded neither agreement, neither the lease of August 27 nor the agreement of August 30.

However, Satterfield, for reasons I think I know, showed Savers only the August 27 agreement which, of course, impaired no security interest at all because it provided for a purchase price at fair market value. It is no impairment of the security whatsoever. In fact, in some instances, it might be good to have something like that when you are reviewing loan papers in behalf of the creditor.

And therefore, I find that Judge Woods was correct that failure on the part of Mr. Steve Adams to respond to the respective motions for summary judgment did not prejudice Tyson. I do not know that Mr. Adams could have said in response to that motion that would change that.

In opposition to the above comments, Tyson argues that Judge Wright was additionally in error as a matter of law in applying the bona fide purchaser doctrine and the doctrine of unclean hands, as well as in her consideration of public policy. We do not reach those arguments because we affirm the ruling of the circuit court on the applicability of the D’Oench, Duhme doctrine to both the quiet tide and foreclosure actions, and Adams’s negligence in those actions did not proximately cause damage to Tyson.

Affirmed.

Special Chief Justice Ralph C. Murray, Special Justice Floyd M. Thomas, Jr., and Special Justice Laurie A. Bridewell join in this opinion.

Jesson, C.J., and Newbern, Corbin, and Brown, JJ., not participating.


author: DAVID Newbern, Justice.

text:
    Pamela GRACE v. Theodore GRACE
    95-831
    930 S.W.2d 362
    Supreme Court of Arkansas
    Opinion delivered October 21, 1996
    [Petition for rehearing denied November 25, 1996.]

      Kaplan, Brewer, &Maxey, BA., by: Philip E. Kaplan and Regina

      Haralson, for appellant.

      Dover & Dixon, P.A., by: Philip E. Dixon and W. Michael Reif, for appellee.
   DAVID Newbern, Justice.

This is a divorce case. The only issues on appeal concern division of the marital property. The property included major assets, such as the marital home, which was awarded to Pamela Grace, and an insurance “book of business,” which was awarded to Theodore Grace. As we understand it, the “book of business” of an insurance agent consists of his right to residual payments from insurance policies sold and from prospective renewals. The Chancellor also adjusted the division of property between the parties by assigning to Mr. Grace a debt the Chancellor termed “unenforceable” and yet “owed” by the parties to his parents in the amount of $5000. We hold the Chancellor erred in subtracting from the value of the “book of business” the amount of federal tax that would have to be paid in the event the asset were sold. We hold it was not error for the Chancellor to consider the $5000 debt, assign it to Mr. Grace, and accordingly reduce the award to Mrs. Grace by half the amount of the debt.

i. The tax credit

A chancellor may consider “the federal income tax consequences of the court’s division of property” when she finds it would be inequitable to divide the property half and half. Ark. Code Ann. § 9-12-315(a)(l)(A)(ix) (Repl. 1993). In this case, there is no demonstrable federal income tax consequence resulting from the division of the property. The Chancellor did not order the “book of business” to be sold. Mr. Grace mentioned, at one point in the proceedings, that he might have to sell that asset in order to satisfy his obligation to Mrs. Grace, but the Chancellor said in her summation, “I don’t think there’s any evidence that he’s going to sell.”

Mr. Grace argues the witnesses who testified about the value of the “book of business” said a buyer would “expense” the purchase. We presume that means a purchaser would be someone in a position to deduct from business profits the expense of purchasing the “book of business” for tax purposes. That ostensibly would give the asset a higher value to the buyer, thus creating a higher market value or selling price and, therefore, a greater tax consequence to the seller. The argument obviously assumes certain facts about the hypothetical buyer being in a position to “expense” the purchase. The contention is that the evidence of the value of the asset was thus based on an assumption that Mr. Grace would have to pay tax on the sale. Again, no sale has been ordered, and none seems to be in prospect.

In support of the Chancellor’s decision on this point, Mr. Grace cites Hogan v. Hogan, 796 S.W.2d 400 (Mo.App. 1990), in which it was held that it was proper to consider the tax consequence of a sale of a building in the division of assets because “The concept of fair market value assumes the sale of the property to an interested buyer.” The opinion does not show whether or not a sale was to occur.

We have not previously addressed the question whether tax consequences of the sale of an asset should be considered when the asset is not required to be sold by the divorce decree and when there is no indication that a sale will occur. Cases addressing this issue are collected in Annot., Tax Consequences of Distribution, 9 ALR 5th 568 (1993).

The majority view is exemplified by decisions such as Kaiser v. Kaiser, 474 N.W.2d 63 (N.D. 1991), and Crooker v. Crooker, 432 A.2d 1293 (Me. 1981). In the Kaiser case, for example, one of the marital assets was an oil-well service company. The Trial Court awarded it to the husband and, in evaluating it for purposes of achieving an equal division of all marital assets, subtracted an amount to be paid in federal taxes upon liquidation. The North Dakota Supreme Court held it was an error of law and a manifest abuse of discretion for the Trial Court to have reduced the value of the asset by tax consequences which were speculative. In doing so, the Court quoted the following from Hovis v. Hovis, 518 Pa. 137, 541 A.2d 1378 (1988):

...In order to insure a “fair and just determination and settlement of property rights” we favor predictability over mere surmise in the valuation and distribution of marital property after divorce. Accordingly, we hold that potential tax liability may be considered in valuing marital assets only where a taxable event has occurred as a result of the divorce or equitable distribution of property or is certain to occur within a time frame such that the tax liability can be reasonably predicted.

The North Dakota Court continued as follows:

We agree with the foregoing decisions holding that a trial court in a divorce action should consider potential taxes in valuing marital assets only if (1) the recognition of a tax liability is required by the dissolution or will occur within a short time; (2) the court need not speculate about a party’s future dealing with the asset; (3) the court need not speculate about possible future tax consequences; and (4) the tax liability can be reasonably predicted.

In this case Mr. Grace is asking not only that we speculate that he will sell the asset in question but that when and if he does so his tax liability will be the same as it would be today. Although the argument is based on an accountant’s testimony about a prospective buyer of the “book of business,” he also asks us to speculate that a prospective buyer would “expense” the purchase and that the tax consequences to such a buyer would be the same as would occur today. As the North Dakota and Pennsylvania Supreme Courts, we prefer not to engage in such speculation.

With respect to § 9-12-315, we need only point out that we have not been made aware of any federal income tax consequence which will result from “the court’s division of property.” In considering a similar statute, an Indiana appellate court stated:

The thrust of the Statute is to recognize that there may be in the plan of division of marital property certain tax consequences which should be taken into account. The clear ... [implication] is that only tax consequences necessarily arising from the plan of distribution are to be taken into account, not speculative possibilities. The Statute limits the trial court to consider only the tax consequences of “of the property disposition.” [Emphases in the original.]

Harlan v. Harlan, 544 N.E.2d 553 (Ind. App. 1989). We hold it was error to consider the tax consequences of a prospective sale of the “book of business” because the decree did not require such a sale and there was no evidence that a sale was imminent.

2. The “debt”

Theodore and Pamela Grace received $5,000 from his parents. The money was intended to finance landscaping of their new home. While there is some doubt as to the exact time the money was received, it was no later than 1989. Mr. Grace’s mother testified it was intended that the money be repaid. It had not been repaid at the time of the divorce in 1995. Pamela Grace testified she could not remember any discussion about repayment, apparently contesting any obligation to pay the money back.

The Chancellor remarked that the debt was “unenforceable” but that it was “owed” by the parties. She apparently considered it unenforceable due to Ark. Code Ann. § 16-56-105(1) (1987), which places a three-year limitation on “any contract, obligation, or liability not under seal and not in writing ...” As we pointed out in Hackett v. Hackett, 278 Ark. 82, 643 S.W.2d 560 (1982), a chancellor has no authority to determine the validity of an obligation to a third party who is not a party to the divorce. Our statute on division of marital property provides, however, that a chancellor is to “take into consideration ... [the] [e]state, liabilities, and needs of each party ...” Ark. Code Ann. § 9-15-315(a)(l)(A)(vii) (Repl. 1993). We have entertained questions about marital debts and whether they should be “considered” in assigning marital property as questions of fact, and we decline to reverse decisions about them unless they are clearly erroneous. Ark. R. Civ. P. 52(a); Pinkston v. Pinkston, 278 Ark. 233, 644 S.W.2d 930 (1983); McEndree v. McEndree, 255 Ark. 243, 499 S.W.2d 596 (1973). See also Warren v. Warren, 33 Ark. App. 63, 800 S.W.2d 730 (1990).

While we disregard the Chancellor’s conclusions about whether the debt in this case was “enforceable” or “owed,” we have no reason to say her factual conclusions about the transfer of the money are in error, or that she erred in considering the $5,000 as a “liability” of the parties.

We could perhaps modify the decree and give Pamela Grace an additional share of the marital property in the amount of $42,370, or half of the $84,740 tax liability for which Theodore Grace was given credit in the original decree. We note, however, that the decree provides for a final adjustment figure owed to Mrs. Grace in the amount of $22,100 to be paid by Mr. Grace at the rate of $500.00 per month with interest at the rate of 8.25% per annum. In view of the fact the entry of a decree consistent with this opinion may make it advisable to consider other payment arrangements, we choose to remand the case to the Chancellor for further orders.

Affirmed in part, reversed in part, and remanded.


author: Tom Glaze, Justice.

text:
    Rammie Earl HALL v. STATE of Arkansas
    CR 95-166
    933 S.W.2d 363
    Supreme Court of Arkansas
    Opinion delivered October 21, 1996
    [Petition for rehearing denied December 9, 1996.  ]

      Appellant, pro se.

      Winston Bryant, Att’y Gen., by: Clint Miller, Deputy Att’y Gen., Sr. Appellate Advocate for appellee.
   Tom Glaze, Justice.

Appellant Rammie Hall was convicted of the capital murder of George DeClerk and sentenced to life without parole. Hall appealed, raising nine points for reversal, and this court found no merit to his arguments and affirmed. Hall v. State, 315 Ark. 385, 868 S.W.2d 453 (1993) (Hall I). Within sixty days after this court’s mandate was issued, Hall filed a post-conviction petition in Randolph County Circuit Court, alleging his counsel had been ineffective at his trial. The trial court denied Hall’s petition, and Hall now raises seven arguments why the trial court should be reversed.

To prevail on any claim of ineffective assistance of counsel, the petitioner must first show that counsel’s performance was deficient. This requires showing that counsel made errors so serious that counsel was not functioning as the “counsel” guaranteed the petitioner by the Sixth Amendment. Thomas v. State, 322 Ark. 670, 911 S.W.2d 259 (1995). Second, the petitioner must show that the deficient performance prejudiced the defense as to deprive the petitioner of a fair trial. Id. Unless a petitioner makes both showings, it cannot be said that the conviction resulted from a breakdown in the adversarial process that renders the result unreliable. Id.

Further, when reviewing ineffective-counsel claims, a court must indulge in a strong presumption that counsel’s conduct falls within the wide range of reasonable assistance. Strickland v. Washington, 466 U.S. 668 (1984). The petitioner must show there is a reasonable probability that, but for counsel’s errors, the factfinder would have had a reasonable doubt respecting guilt, i.e., the decision reached would have been different absent the errors. Id. A reasonable probability is a probability sufficient to undermine confidence in the outcome of the trial. Id.

We now address Hall’s first point that his counsel was ineffective because he failed to compel the State to elect between charging Hall with either premeditated and deliberated capital murder or capital felony murder. The State’s amended information charged Hall with one count of capital murder, but alleged both premeditated and deliberated murder “and” capital felony murder while committing robbery and burglary. He claims the amended information changed the nature and degree of the offense, and he was prejudiced by the “duplicitous, overbroad and vague charging instrument.” He also claims the charges prevented the separation of evidentiary objections and rulings during trial, but we dispose of this argument summarily because he fails to point to any incidence at trial where he was denied making an objection or was unable to obtain a ruling.

As to his contentions that the State’s amended information increased the nature and degree of his offense, we point out that this court answered this argument in Rucker v. State, 320 Ark. 643, 899 S.W.2d 447 (1995). There, Rucker challenged a pretrial amendment of an information that charged Rucker with capital murder on the basis of felony murder and added, as an alternative, the charge of capital murder based upon premeditated and deliberated purpose. This court held that the amended information adding premeditated and deliberated capital murder did not change the nature or degree of the crime charged. See also Nance v. State, 323 Ark. 583, 918 S.W.2d 114 (1996). In view of our holding in Rucker, Hall simply fails to show how the outcome of his trial would have been different had the prosecutor been forced to elect between the capital murder crimes. We also note that, in arguing he was denied a fair trial, Hall never points to the evidence he was prevented from presenting, or shows how he was prejudiced because he had been charged with one count of capital murder, albeit with two types.

In his second point, Hall contends that the State’s fourth amended information charging him with capital murder was invalid and should have been quashed because a deputy prosecutor had previously signed the first amended information in the name of the prosecutor, but without the prosecutor’s consent. Hall argues Amendment 21 to the Arkansas Constitution only allows a deputy prosecutor to file informations if the prosecutor gave his consent and authorization to do so. As a consequence, Hall claims the trial court had no subject-matter jurisdiction. In Bingley v. State, 235 Ark. 982, 363 S.W.2d 530 (1963), the court considered a similar argument. There, Bingley argued Amendment 21 required the information to be signed by the prosecutor, but this court opined the deputy attorney could sign the information in the name of the prosecuting attorney and still be in compliance with the Constitution, as long as the deputy indicates by whom the prosecutor’s name is being signed on the information. While Hall argues that a letter signed by the deputy inferred the prosecutor had no knowledge of the first amended information, we point out that subject-matter jurisdiction is determined from the pleadings. Simpson v. State, 310 Ark. 493, 837 S.W.2d 475 (1992). Here, the record clearly reflects a properly signed amended information giving the trial court jurisdiction. We also note that, aside from his jurisdiction argument, Hall gives no citations of authority or sound argument why the State’s first amended information should taint the three subsequent amendments properly filed in this case.

Next, Hall argues his counsel was ineffective by failing to object to defective instructions of capital murder. Ark. Code Ann. § 5-10-101 (a)(1) and (4) defines capital murder in relevant part as follows:

(1) [I]f he commits or attempts to commit [burglary] and in the course of and in furtherance of the felony, or in immediate flight therefrom, he or an accomplice causes the death of any person under circumstances manifesting extreme indifference to the value of human life; or
(4) With the premeditated and deliberated purpose of causing the death of another person, he causes the death of any person.

Hall correctly asserts that the trial court, in its instruction defining capital felony murder, omitted the words “under circumstances manifesting extreme indifference to the value of human life.” He argues this omission was error because, without it, a conviction entailing punishment by death could be based on conduct that would otherwise support, at most, only a conviction of manslaughter or negligent homicide. He further argues error ensued because the jury was allowed to render a guilty verdict without finding proof beyond a reasonable doubt of every element of the crime with which he was charged.

In Skinner v. R.J. Griffen & Co., 313 Ark. 430, 855 S.W.2d 913 (1993), this court held that, henceforth, in cases involving a trial court’s giving of an erroneous instruction involving the trial mechanism to be used in deciding either a civil or criminal case, we will not require the appellant to demonstrate prejudice. We said that such a requirement is often an impossible burden, and the requirement of an impossible burden, in effect, renders the requirement of correct instructions on the law meaningless. However, the court cautioned that an appellee may still demonstrate that the giving of an erroneous instruction was harmless, mentioning Cates v. Brown, 278 Ark. 242, 645 S.W.2d 658 (1983), and Moore v. State, 252 Ark. 526, 479 S.W.2d 857 (1972), as examples where the jury demonstrably was not misled because the jury rejected the theory of the erroneous instruction, and where the erroneous instruction was obviously cured by other instructions.

Under the Strickland test, as discussed above, Hall must show that, but for his counsel’s failure to object to the trial court’s omission when instructing the jury on capital felony murder, the jury would have reached a different decision. Here, he fails to do so because when reviewing the trial court’s other correct instructions, we conclude the jury would have rendered the same verdict.

In determining whether reversible error resulted in giving an erroneous instruction omitting one element of the government’s burden of proof, the Eighth Circuit Court of Appeals has stated its view on how to proceed, and we find it helpful here. That court, in U.S. v. West, 28 F.3d 748 (8th Cir. 1994), stated the following:

This court’s precedent . . . highlights the importance of reviewing an allegedly faulty jury instruction in context with the entire jury charge and the entire trial. See United States v. McMillan, 820 E2d 251, 256 (8th Cir.), cert. denied, 484 U.S. 898, 108 S. Ct. 234, 98 L.Ed.2d 193 (1987). In McMillan, this court examined a criminal jury instruction that, if viewed in isolation, appeared to remove one element of the government’s burden of proof. Id. Nevertheless, this court determined that two other proper jury instructions and the context of the whole trial corrected any error in the isolated erroneous instruction, and thus the jury charge as a whole properly conveyed the government’s burden to the jury. (Emphasis added.)

In considering the tests set out in Skinner and West, we look at the trial and at all the instructions given to determine if the trial court’s erroneous omission was cured and whether there was a likelihood the jury applied the defective capital felony instruction to lower the government’s burden of proof. Skinner, 313 Ark. at 435; West, 28 F.3d at 751.

First, in reviewing other instructions given at Hall’s trial, we find the jury was told that, if it had a reasonable doubt of Hall’s guilt on the charge of capital murder, it was then to consider second-degree murder. It said that, to sustain this charge, the state must prove beyond a reasonable doubt that Hall knowingly caused the death of George DeClerk “under circumstances manifesting extreme indifference to the value of human life.” As is readily seen when reading the trial court’s instructions, if the jury gave any import to evidence which might have fallen within the element and phrase “under circumstances manifesting extreme indifference to the value of human life,” the jury could have found Hall guilty of the lesser-included offense of second-degree murder; it did not. Also, because the second-degree murder instruction was given the jury, Hall simply is wrong that, but for the omission of the “extreme indifference to the value of human life” phrase, only manslaughter or negligent homicide convictions could be had.

Before leaving this point, we also address Hall’s reference to the trial court’s having omitted the last sentence from the capital felony murder instruction. That instruction sets out the State’s contention that George DeClerk’s death occurred during the commission of the crime of burglary. Hall submits the trial court erred by leaving out the ending sentence, “If you do not find beyond a reasonable doubt that Hall committed or attempted to commit the crime of burglary, then he is not guilty of capital felony murder.” Hall claims prejudice resulted because the State put on no evidence placing him at the scene of the crime, and without proof that he entered or remained unlawfully in DeClerk’s residence, he could not be convicted of the capital felony murder offense.

First, we note the trial court, when giving the capital felony murder instruction, instructed the jury that, as a part of the charge of capital murder, the state must prove burglary beyond a reasonable doubt by showing Hall had entered or remained unlawfully in DeClerk’s residence and he did so with the purpose of committing theft. And while Hall, by his argument here, fails to accept that the State made its case that Hall had burglarized DeClerk’s residence and unlawfully converted DeClerk’s personal property, we must disagree. In Hall I, we held there was more than sufficient evidence, albeit circumstantial, to show he committed the crime of burglary and capital murder. Hall, 315 Ark. at 391.

Hall makes another instruction argument, asserting his counsel was ineffective because he did not tender the lesser-included instruction on first-degree felony murder. We reject Hall’s argument because Hall’s defense was that he had nothing to do with the victim’s death, and in fact claimed that two other men were implicated in the beating and killing of the victim. It would have made no sense to instruct on first-degree felony murder when Hall contended he did not kill the victim, but someone else did. See Franklin v. State, 314 Ark. 329, 863 S.W.2d 268 (1993). As a matter of strategy, Hall’s trial counsel could have foregone tendering or arguing any lesser offense to the jury, especially since the lower offense was inconsistent with his defense at trial. Matters of trial tactics and strategy are not grounds for postconviction relief, and this reason alone is sufficient to affirm on this point. See Vickers v. State, 320 Ark. 437, 898 S.W.2d 26 (1995).

Hall’s next argument is his trial counsel should have objected to the jury’s return of a general verdict. He claims counsel’s failure resulted in Hall not knowing which offense he was found guilty of and whether the jury found all elements of the offense had been proven beyond a reasonable doubt. In this argument, Hall also claims the jury was not instructed to return a unanimous verdict. Contrary to Hall’s assertion, the record reflects the jury was told its verdict must be unanimous. The jury was polled and all twelve jurors agreed with the verdict. Regarding Hall’s general verdict argument, he offers no citation of authority or convincing argument showing he was entitled to such a verdict. Therefore, Hall fails to show error on this point.

Hall also argues that his ineffective counsel improperly advised Hall to plead guilty to the theft of DeClerk’s credit card which was found in his truck in White County. He complains that, because of this bad advice, the White County theft conviction was later used to enhance the evidence introduced at his capital murder trial in Randolph County, where DeClerk resided and was killed. Hall concedes his counsel’s advice was a matter of strategy, but he argues such advice was unethical. We have held that matters of trial tactics and strategy are not grounds for postconviction relief. Hilton v. State, 325 Ark. 140, 924 S.W.2d 239 (1996). Hall additionally attempts to argue double jeopardy concerning the convictions rendered in White and Randolph Counties, but we dealt with that issue in Hall I. While Hall asserts his counsel failed to argue the double jeopardy issue correctly, we have held that postconviction relief does not provide an opportunity to reargue points already settled on appeal. See O’Rourke v. State, 298 Ark. 144, 765 S.W.2d 916 (1989).

Hall further argues that his counsel was ineffective because the counsel never requested funds to employ a private investigator to properly investigate pretrial discovery in preparation for trial. Hall fails to cite what specific evidence or testimony favorable to Hall that a private investigator would have found had one been employed. Further, Hall fails to cite specific testimony favorable to him which would have been elicited if further trial preparation had occurred. While Hall cites specific “missing” reports, he fails to show that these reports, had they been favorable to him, would have changed the outcome of the trial in light of the strong evidence against him. On this point, Hall also contends that his counsel failed to object to a witness’s in-court identification of him when she had been unable to identify him from a prior photographic lineup. However, as the State points out, Hall’s counsel ably cross-examined the witness and elicited testimony of her prior failure to identify Hall. Further, the witness was able to support her in-court identification and presented testimony which the jury was justified in believing.

Finally, Hall claims property belonging to him was seized without a warrant from a third person in Nevada, and therefore, his counsel should have requested suppression of this evidence. Hall does not inform this court of the specific evidence so seized or of the specific facts surrounding its seizure. As the State notes, Hall does not have standing to claim an expectation of privacy in property held by another, even though that property may be his. U.S. v. Payner, 447 U.S. 727 (1980).

In sum, because the errors claimed by Hall amount to no error or to trial strategy, or because Hall failed to show the verdict would have been different, Hall has failed to meet his burden to obtain Rule 37 relief based on ineffective assistance of counsel. We affirm.

Corbin and Roaf, JJ., concur.


author: Tom Glaze, Justice. ROBERT L. Brown, Justice,

text:
    Monty SCOTT, Bob Wheeler, Eric Jackson, Bill Walmsley, and Bill Goodwin, Individually and On Behalf of the Committee Against Amendment 8, and All Others Similarly Situated, Petitioners v. Sharon PRIEST, Secretary of State of the State of Arkansas, Respondent; The Local Option Casino and Arkansas Lottery Committee, Intervenor
    96-1078
    932 S.W.2d 746
    Supreme Court of Arkansas
    Opinion delivered October 21, 1996

      Huckabay, Munson, Rowlett & Tilley, PA., by: Beverly A. Rowl-ett, for petitioners.

      Winston Bryant, Att’y Gen., by: M. Wade Hodge, Asst. Att’y Gen., for respondent.

      Kaplan, Brewer and Maxey, PA., by: Philip E. Kaplan, and Silas H. Brewer, Jr., for intervenor.
   Tom Glaze, Justice.

Petitioners Monty Scott and others bring this original action challenging the validity of the ballot title to proposed Amendment 8, which would allow the establishment of up to eleven gambling casinos in the state, and legalize lottery, charitable raffles, and bingo games in the state. Petitioners generally contend the ballot tide is too long, complex, and detailed to permit a voter to read and comprehend the proposed amendment and make an informed decision on the proposal. Petitioners recognize this court’s prior holdings that length, in itself, does not render a ballot tide insufficient, Christian Civic Action Comm. v. McCuen, 318 Ark. 241, 884 S.W.2d 605 (1994); Parker v. Priest, 326 Ark. 123, 930 S.W.2d 322 (1996). However, they submit that here, like in Page v. McCuen, 318 Ark. 342, 884 S.W.2d 951 (1994), the length of the proposed amendment necessarily caused the proposal’s sponsors to omit important provisions of the proposal when preparing the ballot title. Although the proposed Amendment 8 is twenty pages long, and its sponsors took approximately 550 words in the ballot title to summarize seventy-five subsections contained in the proposal, we hold the length alone would not render the tide invalid. However, we agree that there are numerous material omissions from the ballot tide that clearly prevent a fair understanding of the amendment and would give the voter “serious ground for reflection” on whether to vote for the measure. Id., 344-345.

Since Page, this court has decided a number of cases dealing with ballot initiatives and challenges to their validity under Amendment 7. The most recent decision is Parker v. Priest, 326 Ark. 123, 930 S.W.2d 322 (1996), where this court summarized, as follows, the standards of review for ballot titles: (1) ballot titles must include an impartial summary of the proposed amendment that will give voters a fair understanding of the issues presented and of the scope and significance of the proposed changes in the law; (2) they cannot omit material information that would give the voter serious ground for reflection; and (3) they must be free from misleading tendencies that, whether by amplification, omission, or fallacy, thwart a fair understanding of the issues presented. Id. (citations omitted).

In Parker, this court refused injunctive relief and allowed a proposed amendment to remain on the ballot where the ballot title was 482 words in length, but the title accurately and completely summarized the text of the proposed amendment. We further took particular note that the language used was plain and organized in a coherent manner, and that no material omissions occurred to make the ballot title misleading. Unfortunately, that is not the situation before us in the present case.

Petitioners initially point out that proposed Amendment 8 provides for casino gambling in the counties of Boone, Chicot, and Garland without the voters first being given the right to approve such gambling at a local-option election. They further note that the licensee at each designated site in these three counties are guaranteed gaming benefits upon the proposal’s adoption at the November 5, 1996 General Election. However, eight other casino enterprises are authorized under proposed Amendment 8 only after approval of the voters of the county or counties where those enterprises are to be located. The ballot title fails to mention this preferential treatment given the three licensees in Boone, Chicot, and Garland counties, and we believe this omission would give the voters serious ground for reflection on whether to vote for the measure.

Another point concerning the local-option elections is that the proposed amendment changes existing law by requiring that 20% of the qualified voters in a county approve casino gambling. Presendy, Amendment 7 to the Arkansas Constitution requires only 15% of the legal voters of the county to pass a local-initiative measure. Petitioners submit that, while the ballot title informs the voter of the 20% requirement, it fails to disclose that that percentage is higher than the requirement under Amendment 7. In addition, petitioners suggest this change in the law places later casino applicants at a greater disadvantage than the initial licensees who are exempt from the local-option requirement altogether.

The petitioners cite Bradley v. Hall, 220 Ark. 925, 251 S.W.2d 470 (1952), where this court granted injunctive relief based on the insufficiency of the ballot tide. There, the title failed to disclose that the proposed amendment would legalize service charges and price differentials that previously had been usurious. The Bradley court stated the following:

It is evident that before determining the sufficiency of the present ballot title we must first ascertain what changes in the law would be brought about by the adoption of the proposed amendment. For the elector, in voting upon a constitutional amendment, is simply making a choice between retention of the existing law and the substitution of something new. It is the function of the ballot tide to provide information concerning the choice that he is called upon to make. Hence the adequacy of the tide is direcdy related to the degree to which it enlightens the voter with reference to the changes that he is given the opportunity of approving. Id. at 927

In this case, the percentage requirement proposed in Amendment 8 conflicts with the one in our present Amendment 7. Because the ballot tide fails to convey this change so that the voters could have a fair understanding of the issue, we conclude this nondisclosure adds to the tide’s invalidity.

A third omission in the ballot tide is its failure to reveal the proposal’s definition of “Gross Gambling Revenue.” Proposed Amendment 8 provides casinos must pay state taxes of 8% on their gross gambling revenues, and municipal and county taxes of up to 2% on such revenues. The definition is of obvious import when calculating the amount of taxes owed by a licensee. In this instance, the proposal defines gross gambling revenues not as the total (or gross) amount of all monies received from casino gambling operations, but instead it is defined to be all monies received from casino gambling less all winnings paid out. Undoubtedly, voters could be misled concerning how much of the gambling revenues would be taxed. Furthermore, voters also would be confused as to whether lottery revenues, legalized by proposed Amendment 8, would be taxed as well. Under the proposal, they would not, but the ballot tide does not reveal that fact.

Another serious error in the ballot tide concerns its representation that “no more than eleven licensed casinos may be simultaneously operated” in the state. Section 7 of the proposed amendment makes a fair attempt to restrict the number of licensed casinos in operation at one time to eleven, but Section 1 (D) authorizes “casino gambling in other constitutional amendments” as well. (Emphasis added.) In other words, if “other” constitutional amendments include the other initiative proposals on the same ballot, this Section 1(D) provision conflicts with the existing law in Amendment 7, which provides as follows:

If conflicting measures initiated or referred to the people shall be approved by a majority of the votes severally cast for and against the same at the same election, the one receiving the highest number of affirmative votes shall become law.

In sum, while Section 1(D) was likely intended only to assure the continued validity of proposed Amendment 8, regardless of what happened to other casino proposals offered voters at the November 5 General Election, it is clear Arkansas could well end up with more than eleven casinos if another gambling proposal besides proposed number 8 is enacted.

Petitioners further urge the ballot title fails to disclose that proposed Amendment 8 allows its initial licensees to compete with Oaklawn and Southland by permitting them to engage immediately in “simulcast sport wagering,” but the two existing parimutuel gambling enterprises are not allowed to offer casino gambling until November 1998. We agree. Certainly, this unequal edge in treatment given the new casino licensees is not revealed in the ballot title and could well make a difference in the voters’ decision when voting on the proposal.

While petitioners argue more than ten other possible omissions would mislead the voters when casting their votes for or against proposed Amendment 8, we see no need to discuss more than the ones mentioned above. We summarize much as we did in Page, that the proposed Amendment 8 sponsors’ insistence in covering the establishment and operation of casino gaming in so much detail can be said to have sounded the proposal’s own death knell. Page, 318 Ark. at 347. While Amendment 7 does not limit the length of a proposal, the proposed measure must be of a size capable of having a ballot title which will not only convey the scope and import of the measure, but also impart a description of the proposal so voters can cast their votes intelligendy and with a fair understanding of the issue. Id. at 347. In this respect, we hold the ballot title now before us fails.

This is a good point to emphasize our earlier request of the General Assembly in Page v. McCuen to attempt to establish a constitutional initiative and referendum procedure that will permit an early resolution of ballot-tide cases. We stated the following:

Until appropriate action is taken to correct the problems attendant to proposals submitted under Amendment 7, citizens can continue to expect measures to be removed from the ballot immediately prior to the election. This court does not enjoy being in the “last-minute” position of review. The people of Arkansas deserve an initiative and referendum procedure which allows them the confidence that measures, after having been adequately reviewed, will not be removed from the ballot. The sponsors of initiative proposals should also be assured their ballot tides and proposed measures meet required guidelines and rules before they spend their time, energy and monies in getting their proposal before the voters.

See also Finn v. McCuen, 303 Ark. 418, 798 S.W.2d 34 (1990), (court held unconstitutional Act 280 of 1989, which provided by statute an early procedure to review ballot titles). The General Assembly responsibly responded by referring for a vote of the people proposed Amendment 3 which, if approved by the voters at the November 5, 1996 General Election, will provide a procedure, assuring voters that the petitions they sign will actually place the measure on the next General Election ballot, if the sponsors obtain the necessary number of signatures. Meanwhile, under present law as provided in Amendment 7, we declare the ballot title to proposed Amendment 8 insufficient and invalid and enjoin its placement on the ballot, or alternatively that any votes cast on such proposal not be counted or certified.

The court shortens the time for issuance of mandate, and directs that any petition for rehearing must be filed on or before Friday, October 25, 1996.

Doddridge M. Daggett, Special Justice, concurs, and would further cite as cause for striking Amendment 8 the recent decision of Parker v. Priest, 326 Ark. 123, 930 S.W.2d 322 (1996), in which the court stated:

They (the drafters of the ballot tide) cannot omit material information that would give the voter serious ground for reflection.

In my opinion, Amendment 8 would create a virtual monopoly, or near monopoly, for the individuals or entities owning the real estate onto which casinos can be constructed. I believe that it is a serious and fatal omission of material information to not list the owners of the proposed casinos or the owners of the real estate. Casino gambling, and all of the good or bad things that it may bring to our state, will have a tremendous economic and social impact upon the citizens of the state. The citizens are entitled to know who will profit from this amendment to our constitution.

Dudley, J., not participating; Brown, J., dissents.

ROBERT L. Brown, Justice,

dissenting. Proposed Amendment 4 and Proposed Amendment 8 both authorize a state lottery, charitable bingo, and casino gambling. Proposed Amendment 4 authorizes three casino establishments in Hot Springs with one adjacent to the Oaklawn Racetrack. Proposed Amendment 8 authorizes casino gambling at five sites throughout the state, including the two existing pari-mutuel tracks, with six additional sites subject to local-option elections. This court has approved Proposed Amendment 4 for the ballot. Parker v. Priest, 326 Ark. 123, 930 S.W.2d 322 (1996). It now enjoins placement of Proposed Amendment 8 on the ballot. I believe the people should have the right to choose between these competing proposals.

In the past, I have voted to strike misleading proposals from the ballot. See, e.g., Christian Civic Action Comm. v. McCuen, 318 Ark. 241, 884 S.W.2d 605 (1994) (the term “additional racetrack wagering” did not sufficiently inform the voters of casino gambling); Bailey v. McCuen, 318 Ark. 277, 884 S.W.2d 938 (1994) (misleading language on restriction of legal fees and omission of standard for review in workers’ compensation cases). The misleading tendency in those two cases was serious, and the omissions would have given voters a serious ground for reflection. Here, the deficiencies espoused by the majority do not approach that degree of significance.

I first question whether the ballot title is misleading with respect to sites for casino gambling in designated counties versus local-option counties. The ballot tide reads:

AUTHORIZING CASINO GAMBLING AS AN APPROPRIATE LAND USE BY LICENSEES APPROVED BY THE COMMISSION AT: ONE (1) PREVIOUSLY CHOSEN SPECIFIC SITE, AS SET FORTH BY LEGAL DESCRIPTION IN THIS AMENDMENT, IN EACH OF BOONE, GARLAND, AND CHICOT COUNTIES; THREE (3) ADDITIONAL LICENSES, ONE (1) IN PULASKI AT A PREVIOUSLY CHOSEN SITE SET FORTH BY LEGAL DESCRIPTION IN THIS AMENDMENT, ONE (1) IN GARLAND AND ONE IN MILLER COUNTIES IF APPROVED BY COUNTY LOCAL OPTION ELECTIONS; THREE (3) AT-LARGE LICENSES IN ANY COUNTY IF APPROVED BY THE COMMISSION AND BY COUNTY LOCAL OPTION; AND AT THE TWO EXISTING PARIMUTUEL TRACKS AFTER NOVEMBER 1, 1998;

The language appears sufficiently clear and unambiguous. Casino gambling is approved in Boone, Garland, and Chicot Counties, as well as at the pari-mutuel tracks. It can also be approved in Pulaski, Garland (a second site), and Miller Counties by local-option elections, and at sites in three other counties, also by local-option elections. I do not see any confusion here.

Nor do the other deficiencies asserted qualify as misleading or as serious omissions:

— The ballot title does provide for a local-option election upon petition by 20% of the qualified voters in a county. That is a more stringent requirement than the general requirement of a petition by 15% of the voters contained in Amendment 7 to the Arkansas Constitution. I see nothing amiss in requiring a stricter standard for calling local-option elections for casino gambling when the standard is disclosed in the ballot title.
— The ballot tide reveals state taxes on gross gambling revenue which the proposed amendment defines as revenue to the casino after winnings are paid out. This seems reasonable. Net revenue would be revenue remaining after ordinary expenses (rent, payroll, and so forth) are also deducted. I see nothing fatal to the ballot tide in 'his regard.
— Proposed Amendment 8 limits the number of casinos to eleven. Language in the proposed amendment allows casinos authorized in other constitutional amendments to be counted toward that total. The maximum number is still eleven. This effort to meld Proposed Amendment 8 to other proposals should not result in its elimination from the ballot. If there is an irreconcilable conflict between two amendments that pass, Amendment 7 to the Arkansas Constitution provides that the one receiving the greater number of votes becomes law.
— The proposed amendment allows initial casino licensees to offer simulcast gambling immediately which Oaklawn Racetrack, at least, is now doing. Oaklawn and South-land must wait to offer casino gambling until November 1998. Presumably, the idea is that it will take time for the initial licensees to set up their operations, whereas Oak-lawn and Southland are already operational. The attempt appears to be to place all operators on an equal footing. I do not find this to be unreasonable or necessary for placement in the ballot title.

In short, I fail to see the serious deficiencies embraced by the majority. This is the first instance that I can find where one competing ballot issue was struck and one was left on the ballot. I am reluctant to leave Proposed Amendment 4 on the ballot and strike Proposed Amendment 8 under these circumstances, where the litany of deficiencies is so weak. This court has stated:

Our most significant rule is that in determining the sufficiency of the title we give a liberal construction and interpretation of the requirements of Amendment 7 in order to secure its purposes to reserve to the people the right to adopt, reject, approve, or disapprove legislation.

Gaines v. McCuen, 296 Ark. 513, 519, 758 S.W.2d 403, 406 (1988) (emphasis in original); see also Bailey v. McCuen, 318 Ark. 277, 884 S.W.2d 938 (1994); Plugge v. McCuen, 310 Ark. 654, 841 S.W.2d 139 (1992); Finn v. McCuen, 303 Ark. 418, 798 S.W.2d 34 (1990).

I respectfully dissent.

       This proposed Amendment 3 is essentially the same as Act 280 of 1989, ruled unconstitutional by this court in Finn, 303 Ark. 418.