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

text:
    Maurice SMITH, Director, Arkansas Highway & Transportation Department, et al. v. AMERICAN TRUCKING ASSOCIATION, INC., et al.
    89-232
    781 S.W.2d 3
    Supreme Court of Arkansas
    Opinion delivered December 11, 1989

      Robert L. Wilson and A.T. Good loe II, of the Arkansas Highway and Transp. Dep’t; and Friday, Eldredge & Clark, by: B.S. Clark, John Dewey Watson, and Robert S. Shafer, for appellants.

      Mayer, Brown & Platt, by: Andrew L. Frey, Kenneth S. Geller, and Evan M. Tager, Daniel R. Barney and Robert Diggs, Jr., of the ATA Litigation Center; and Williams & Anderson, by: Peter G. Kumpe, for appellees.
   David Newbern, Justice.

This is an appeal from a chancellor’s order granting a preliminary injunction. The injunction requires the appellants, referred to here collectively as “the state,” to place in escrow certain highway use and fuel taxes upon collection. The appellees are the American Trucking Associations, Inc., and several trucking companies, representing a class of interstate trucking companies operating trucks registered outside Arkansas. They will be referred to collectively as “ATA.” ATA sought to enjoin the collection of the taxes and a refund of those already collected. The chancellor granted ATA’s request for preliminary relief upon finding that it was likely ATA would succeed on the merits and, without the escrow, it could suffer irreparable harm. We affirm because we find no abuse of the chancellor’s discretion.

The taxes placed in escrow are the highway use tax prescribed in Ark. Code Ann. § 27-35-205 (Supp. 1989) for trucks weighing 73,281 pounds or more (HU tax) and the $ 10.00 annual fee required by Ark. Code Ann. § 26-55-708 (1987) to be paid for any vehicle using state highways and subject to the motor fuels tax (decal tax). The challenge to the HU tax is that it violates the Equal Protection Clause because it contains a so-called “natural resources exemption,” according to which haulers of certain items do not have to pay the tax despite the fact that they do as much damage to the highways per mile traveled as trucks carrying the same weight composed of non-exempt items. It is also challenged on the basis of the Commerce Clause because truckers who have not qualified for the basic $.025 per mile rate are permitted to purchase an $.08 per mile trip ticket which, in practice, allegedly results in more and disparate expense to truckers not registered in Arkansas. The challenge to the decal tax is based on the Commerce Clause. The argument is that it has a greater impact on interstate truckers using Arkansas highways than on those travelling solely on Arkansas highways.

1. Preliminary injunction standard

The state cites Kreutzer v. Clark, 271 Ark. 243, 607 S.W.2d 670 (1980), and Paccar Financial Corp. v. Hummell, 270 Ark. 876, 606 S.W.2d 384 (Ark. App. 1980) for its contention that a party seeking a preliminary injunction must demonstrate a likelihood of success on the merits of the claim for a permanent injunction as well as the likelihood that, absent the granting of preliminary relief, irreparable harm will occur. The cases are correctly cited with respect to the irreparable harm point, but neither mentions the requirement of likelihood of success on the merits. We agree, however, that a showing of a likelihood of success on the merits is necessary. Munson v. Gilliam, 543 F.2d 48 (8th Cir. 1976). See also American Trucking Assn’s, Inc. v. Gray, 280 Ark. 258, 675 S.W.2d 207 (1983).

2. Standard, of review

An order granting or denying a preliminary injunction is within the chancellor’s discretion. American Trucking Assn’s v. Gray, supra. We do not reverse the granting of a preliminary injunction unless there has been an abuse of the chancellor’s discretion. Scrivner v. Portis Mercantile Co., 220 Ark. 814, 250 S.W.2d 119 (1952); Riggs v. Hill, 201 Ark. 206, 144 S.W.2d 26 (1940).

3. The HU tax

In her order placing the HU tax collections in escrow, the chancellor specifically found that ATA was likely to succeed because the law exempting trucks hauling certain items, Ark. Code Ann. § 27-35-205(c) (Supp. 1989), appears to be inconsistent with the basic purpose of the tax. The chancellor cited Williams v. Vermont, 472 U.S. 14 (1985), in which the Supreme Court held that taxpayers had stated a claim that Vermont’s use tax on automobiles was in violation of the Equal Protection Clause and mentioned the fact that the tax treated taxpayers unequally on a basis which bore “no relation to the statutory purpose.” 472 U.S. at 24.

As to the trip permit, the chancellor stated ATA had shown a likelihood of success in establishing that truckers based in other states purchasing the permits at $.08 per mile were, in practice, having to pay more than Arkansas based truckers for the privilege of using Arkansas highways, citing Complete Auto Transit, Inc. v. Brady, 430 U.S. 274 (1977), and Larey v. Continental Southern Lines, Inc., 243 Ark. 278, 419 S.W.2d 610 (1967).

In the Complete Auto case the Supreme Court upheld a Mississippi tax on the basis that it was fairly apportioned among those who had to pay it and was related to the services provided by the state. In the Larey case this court held an Arkansas fuel tax in violation of the Commerce Clause because it discriminated against interstate bus operators. The state argued the discrimination was justified, but we rejected the argument because we had “nothing before us to indicate that this cost bears any relationship whatever to the resulting difference in the tax collected.” 243 Ark. at 284, 419 S.W.2d at 614.

The chancellor noted that the state had not demonstrated that the $.025 per mile rate was, “in practice, available to interstate motor carriers whose business operations do not economically justify prequalification of any of their vehicles. . .and who, consequently, must satisfy the HU tax on arriving at the state’s border.”

Although the state is correct in arguing that the plaintiffs, ATA, bear the burden of proof, the chancellor obviously found they had presented a prima facie case that, in practice, trucks registered outside Arkansas are paying the $.08 per mile rate and Arkansas trucks are taxed at $.025. We can not say the chancellor abused her discretion in deciding, based on the authorities cited and the information before her, that the plaintiffs were likely to succeed on their claims against the HU tax.

4. The decal tax

The motor fuel tax law requires those subject to it to pay a tax on fuel used in Arkansas even though it may have been purchased outside the state. By purchasing the decal for $10.00, one becomes a bonded fuel user and may pay the fuel tax quarterly rather than pay it at the border each time the user leaves the state. A user who does not leave the state need not buy the decal because the tax will always be paid at the pump. ATA argues, and the chancellor found it probably would succeed in showing, that the decal requirement, in practice, requires interstate truckers to pay more because it is their only “viable” option.

In American Trucking Associations v. Gray, 295 Ark. 43, 746 S.W.2d 377 (1988), we held a “flat tax” unconstitutional despite the fact that both Arkansas based and non-Arkansas based truckers had the option of paying it or paying a per mile tax. Again, we cannot say the chancellor abused her discretion with respect to this decal tax, the impact of which may be the same as that of a flat tax.

5. Irreparable harm

Nor can we fault the chancellor’s conclusion that irreparable harm will be the result if ATA’s claim succeeds and the taxes are, in the interim, allowed to be placed in the state treasury. A suit against the state for damages could be the subject of a defense of sovereign immunity resulting in no recovery of the taxes collected in spite of the right to have the collection of them enjoined. There is authority for the practice of placing these taxes in escrow. American Trucking Associations v. Gray, 483 U.S. 1306 (1987).

We agree with the chancellor’s decision which preserves the tax proceeds for the state in the event it should prevail yet preserves them for ATA if the opposite result is reached.

Affirmed.

Hays, J., concurs.

Steele Hays, Justice,

concurring. I do not agree that appellees have demonstrated the “strong likelihood of success on the merits,” that the law requires. Munson v. Gilliam, 543 F.2d 48 (8th Cir. 1976). However, I do agree that an escrow of the highway use and decal taxes is an appropriate step, for the present, given the unique history of this litigation. On that basis alone I concur.


source: Caselaw Access Project

author: Tom Glaze, Justice. John I. Purtle, Justice,

license: Public Domain

text:
    ARKANSAS BANK & TRUST COMPANY v. Harold ERWIN, Judge
    89-198
    781 S.W.2d 21
    Supreme Court of Arkansas
    Opinion delivered December 11, 1989
    [Rehearing denied January 16, 1990.]

      Barrett, Wheatley, Smith & Deacon, by: John V. Phelps, for appellant.

      Bill W. Bristow, P. A.; David Throesch; and John Burris, for appellee.

      Hickman and Hays, JJ., would grant rehearing. Turner, J., not participating.

   Tom Glaze, Justice.

This case concerns a petition for writ of prohibition filed by the Arkansas Bank & Trust Co., alleging the Randolph County Circuit Court does not have venue of a law suit filed against the Bank by plaintiffs Kenneth Smith, Darrell Alphin and Tommie Alphin, the administratrix of the estate of William Alphin, deceased. We hold that venue is proper in Randolph County and deny the Bank’s request for writ of prohibition.

The Bank’s involvement in this matter arose from its having been appointed guardian of the estate of J. D. Burchette in November 1967, when Burchette was found mentally incompetent. In 1985, Burchette was involved in an automobile accident in Montgomery County, which caused his own death, the death of William Alphin and injuries to David Alphin and Kenneth Smith. Apparently, Burchette’s vehicle crossed the centerline of the highway, causing a head-on collision with the automobile containing the Alphins and Smith. At the time of the accident, the Alphins and Smith were residents of Randolph County; thus, under Ark. Code Ann. § 16-60-112(a) (1987), William Aiphin’s estate, Darrell Alphin and Smith chose to file suit against Burchette’s estate in their home county of Randolph. That lawsuit resulted in a default judgment against Burchette’s estate in the amount of $1,574,368. The Bank was not a party to that suit.

Apparently the plaintiffs were unable to recover any of their judgment against Burchette’s estate, so they filed this second suit against the Bank. This suit alleged two causes of action against the bank, one for negligent entrustment and one for breach of fiduciary duty. The plaintiffs again brought suit in Randolph County because they contend their negligent entrustment action is one for personal injury and wrongful death and § 16-60-112(a) allows them to fix venue in their resident county. The Bank responds stating that the real character of the plaintiffs’ second suit is not one of negligent entrustment, but instead questions only the manner in which the Bank and its trust department functioned in its relationship as guardian of Burchette’s estate. See Atkins Pickle Co. v. Burrough-Uerling-Brasuell Consulting Engineers, 275 Ark. 135, 628 S.W.2d 9 (1982). It further explains that the automobile accident was an entirely collateral matter in which the Bank did not participate. As a consequence, the Bank asserts any action against it must be filed under Ark. Code Ann. § 16-60-104 (1987), the corporation venue statute, which fixes venue where the Bank’s principal and only office is situated — Garland County.

The Bank relies heavily on our Atkins Pickle decision which adopted the rule that when a complaint asserts both local and transitory causes of action, the venue is determined by the real character of the action, by its principal purpose or object, by the principal right being asserted. In Atkins Pickle, the plaintiff Atkins Pickle brought a suit for breach of contract in Pope County, against defendants that were situated or resided in other Arkansas counties, and the suit was dismissed for improper venue. In a further effort to establish a local action and venue in Pope County, Atkins Pickle subsequently refiled its action, adding language to its original complaint purporting to allege injury to real property in Pope County. The trial court again dismissed Atkins Pickle’s complaint for improper venue, and we affirmed. This court held that, even under the allegations of the new complaint, Atkins Pickle could not establish its right to recover except by proving a contract and the defendants’ failure to perform their promises. The court concluded that the physical damage to land that resulted from the defendants’ breach was only one of several consequences and was merely incidental and not the basis for Atkins Pickle’s cause of action.

Contrary to the Bank’s argument here, the plaintiffs’ complaint clearly alleges negligent entrustment as a tort claim against the Bank and is not merely an action incidental to the plaintiffs’ claim resulting from the Bank’s alleged breach of a fiduciary duty it owed Burchette’s estate. Negligent entrustment has been defined as follows:

One who supplies directly or through a third person a chattel for the use of another whom the supplier knows or has reason to know to be likely because of his youth, inexperience, or otherwise, to use it in a manner involving unreasonable risk or physical harm to himself and others whom the supplier should expect to share in or be endangered by its use, is subject to liability for physical harm resulting to them.

Restatement (Second) Torts § 390 (1965).

Entrustment cases, certainly the ones in Arkansas, generally have involved automobiles. See generally, Woods, Negligent Entrustment: Evaluation of a Frequently Overlooked Source of Additional Liability, 20 Ark. L. Rev. 101 (1966). While entrustment cases usually involve a supplier who in some manner directly entrusts the automobile to the incompetent, such negligent entrustment can also arise when the incompetent, instead of being given the automobile, is given funds to buy it. Id.; Bugle v. McMahon, 35 N.Y.S.2d 193 (1942). Generally, the following elements are necessary in an entrustment case:

(1) Proof the entrustee was incompetent, inexperienced or reckless;
(2) the entrustor knew or had reason to know of the entrustee’s condition or proclivities;
(3) there was an entrustment of the chattel;
(4) the entrustment created an appreciable risk of harm to the plaintiff and a relational duty on the part of the defendant; and
(5) the harm to the plaintiff was proximately or legally caused by the negligence of the defendant.

Here, the plaintiffs, in support of their theory of negligent entrustment, alleged the following:

(a) J. D. Burchette was incompetent by reason of insanity caused by schizophrenic reaction;
(b) That Arkansas Bank & Trust Company knew of its ward’s condition and proclivities;
(c) That Arkansas Bank & Trust Company allowed its ward to operate said vehicle and in fact to do so without liability insurance;
(d) That the aforesaid entrustment and operation of said vehicle without insurance created an appreciable risk of harm to the public in general and these plaintiffs in particular and a correlational duty on the part of the defendant guardian; and
(e) That the harm to the plaintiffs herein was proximately caused by the negligent driving of J. D. Burchette and the negligence of defendant Arkansas Bank & Trust Company in allowing J. D. Burchette to operate said vehicle and further to operate said vehicle without liability insurance.

Although the plaintiffs included in their complaint a second count that set out another cause of action based on a breach of fiduciary duties imposed by statutory law and common law, they also clearly alleged the separate tort cause of action for entrustment. Plaintiffs’ entrustment theory, as alleged in their complaint, rests on its own facts and law and does not depend on whether the Bank breached its duties to Burchette’s estate. Because negligent entrustment, as alleged, is a wrong which resulted in the death or injuries of the plaintiffs, venue, under § 16-60-112(a), is proper in Randolph County because that county is where the plaintiffs lived at the time of injury.

Our holding is in keeping with this court’s decision in Forrest City Machine Works v. Colvin, 257 Ark. 889, 521 S.W.2d 206 (1975), where we held that if the personal injury venue statute (§ 16-60-112(a)) is inconsistent with the venue statute which pertains to domestic corporations (§ 16-60-104), it is only inconsistent insofar as actions for personal injury or death caused by a wrongful act are concerned and in that case the personal injury statute applies.

For the reasons stated above, the writ of prohibition is denied.

Hickman, Purtle and Hays, JJ., dissent.

John I. Purtle, Justice,

dissenting. The majority opinion improperly places venue of this cause of action in Randolph County. This case is not about an automobile accident. Instead, it concerns an assignment of a judgment and the management of the trust department of a Garland County bank, which has no other base of operation. Lip service is paid to the allegation of negligent entrustment. If, however, negligent entrustment occurred at all, it occurred in Garland County. Not even the automobile accident upon which the initial judgment was based occurred in Randolph County. Therefore, I see no basis whatsoever for establishing venue in that county.

This is an ingenious method on the respondent’s part of getting the petitioner out of its native Garland County and into the friendly environment of Randolph County. It is interesting to note that the bank was not named in the original complaint. Had the bank been named at that time, we can be sure that at least the present motion would have been made earlier; If prohibition had been denied, the bank would at least have been able to come in and fight the case on its merits.

Regardless of what an action is called, it should be viewed for what it really is. We had this principle in mind in deciding Farm Bureau Mutual Ins. Co. of Arkansas v. Southall, 281 Ark. 141, 661 S.W.2d 383 (1983), where we stated: “When a complaint asserts both local and transitory causes of action the venue is determined by the principal purpose of the action.” To the same effect, see Atkins Pickle Co., Inc. v. Burrough-Uerling-Brasuell Consulting Engineers, Inc., 275 Ark. 135, 628 S.W.2d 9 (1982).

The petitioner correctly asserts that Ark. Code Ann. § 16-60-104 (1987) requires that a cause of action against a corporation be brought “in the county in which it is situated or has its principal office or place of business, or in which its chief officer resides.”

The petitioner bank was the guardian only of the estate of the incompetent. Perhaps another party was the guardian of the person. The only allegations in the complaint concerning acts of the bank were conclusory charges of “negligent entrustment” and the bank’s allowing the ward “to operate said automobile . . . without liability insurance. . . .” Surely there should be specific acts of negligence recited if this is a negligence case. Mere conclusions are never sufficient to state a cause of action.

Although I have nothing against lawyers demonstrating initiative by fashioning novel theories for recovery, I do feel that such theories should be buttressed with specific allegations of facts which would support a judgment. It is contrary to the venue statutes and our prior decisions to allow this type of action to be maintained in Randolph County.

Venue is apparently a matter of choice now. This decision will no doubt encourage the expansion of forum shopping.

Hickman and Hays, JJ., joins this dissent.

       The plaintiffs brought suit individually and as assignees of Burchette’s estate. While the Bank argues that the fact the plaintiffs brought the suit as assignees is conclusory that the complaint only stated a cause of action for breach of fiduciary duty, we disagree because the plaintiffs individually brought the cause of action for negligent entrustment.

       No motion for severance was made regarding the second count, and we do not reach the question regarding whether the trial court had venue as to the cause of action contained in that count.


author: Tom Glaze, Justice. Darrell Hickman, Justice,

text:
    Rondal CAMPBELL v. STATE of Arkansas
    CR 89-202
    780 S.W.2d 567
    Supreme Court of Arkansas
    Opinion delivered December 11, 1989
    [Rehearing denied January 16, 1990.]

      Young & Finley, by: Dale W. Finley, for appellant.

      Steve Clark, Att’y Gen., by: J. Brent Standridge, Asst. Att’y Gen., for appellee.

      Hickman and Hays, JJ., would grant rehearing. Turner, J., not participating.

   Tom Glaze, Justice.

Appellant was charged with the crimes of theft by receiving with a value in excess of $200.00 and possession of a controlled substance (marijuana) with intent to deliver. The two charges were severed and tried separately. This appeal involves the appellant’s conviction of the theft by receiving crime. Because the jury found that the theft charge involved property that exceeded $200 in value, appellant was sentenced under the class C felony provision in Ark. Code Ann. § 5-36-106(e)(2) (1987) and given five years imprisonment.

On appeal, appellant essentially claims that the trial court denied him an instruction, which in view of the evidence, would have allowed him to argue to the jury that the stolen property he possessed was valued at less than $200. Under such circumstances, the jury could have found the appellant guilty of theft by receiving, convicted him of a class A misdemeanor and sentenced him to a term not to exceed one year. Ark. Code Ann. §§ 5-36-106(e)(3) and 5-4-401 (1987).

In support of his claim, appellant argues that the state’s evidence valued the stolen property at an amount that would have been less than $200.00 if the jury had been properly instructed to deduct from that market value amount the $40 in cash the appellant paid for the stolen goods. To support his argument, appellant points to Chapter 36 of Ark. Code Ann. entitled Theft, which contains all crimes dealing with the wrongful acquisition of property or services and combines them into a single, comprehensive offense. See original commentary to Ark. Code Ann. § 5-36-102 (1987).

In particular, appellant cites Ark. Code Ann. § 5-36-101(11) which in relevant part provides as follows:

(A) “Value” means:
(i) The market value of the property or services at the time and place of the offense; or
(ii) If the market value of the property cannot be ascertained, the cost of replacing the property within a reasonable time after the offense; or
* * *
(B) If the actor gave consideration for or had a legal interest in the property or service, the amount of the consideration or the value of the interest shall be deducted from the value of the property or service to determine value. (Emphasis added.)

In applying the above provisions to the present case, the appellant submits that the state’s witness, Dennis Gale, testified that the total value of the three stolen items (a VCR, microwave and portable television) would be about $355. Gale added, however that the VCR, upon which he assigned a value of $125, would have no value if it did not work. In that event, the total market value of the stolen property would be reduced to $230. The appellant claims that, under § 5-36-101(11)(B), he is entitled to a further reduction of $40 since that was the amount he paid for the stolen property. In sum, when considering the market value given the stolen items and crediting the $40 amount to which he is entitled under § 5-36-101(11)(B), he'asserts that instead of convicting him of a class C felony, the jury could have convicted him of a class A misdemeanor as allowed under Ark. Code Ann. § 5-36-106(e)(3) (1987).

The state submits several arguments in opposition to the appellant’s argument. First, it cites Wisconsin’s theft law which contains a value provision similar to Arkansas’s but the Wisconsin law reads, “If the thief gave consideration for, or had a legal interest in, the stolen property, the amount of such consideration or value of such interest shall be deducted from the total value of the property.” See Wis. Stat. Ann. § 943.20 (West Supp. 1989). Arkansas’s comparable provision, § 5-36-101(11)(B), employs the use of the term actor rather than thief; thus by citing Wisconsin’s statute, the state suggests Arkansas’s theft value provision should apply only in cases where the thief or person stealing the property is involved as opposed to those persons who illegally receive such stolen goods. Such a suggestion is ill-founded. Section 5-1-102(2) of Ark. Code Ann. (1987) broadly defines “actor” as “a person who possesses something,” and subsection 15 of that same section defines “possess” to mean “exercise actual dominion, control, or management over a tangible object.” In sum, the term actor, as used under Arkansas’s law, § 5-36-101 (11)(B), is obviously intended to include all those persons who have committed any form of theft set out in Chapter 36 of the Code, including theft by receiving.

This conclusion is consistent with the Code’s original commentary to § 5-36-101, which discusses “value” and reflects Arkansas’s law on the subject is patterned after Texas law. Tex. Penal Code Ann. §31.08 (Vernon 1989) provides in relevant part as follows:

(d) If the actor proves by preponderance of the evidence that he gave consideration for or had a legal interest in the property or service stolen, the amount of the consideration or the value of the interest so proven shall be deducted from the value of the property or service. . . (Emphasis added.)

The Texas Penal Code defines actor, the term used in § 31.08 above, to mean a person whose criminal responsibility is in issue in a criminal action. See Tex. Penal Code Ann. § 1.07(a)(2) (Vernon Repl. 1974). Under Texas criminal law, the term actor is used instead of defendant in defining most offenses because a person is not technically a defendant until charged. Id. See Practice Commentary. Like Arkansas law, the Texas Penal Code provisions dealing with theft encompass all forms, including the crime of receiving stolen property. See Tex. Penal Code Ann. § 31.03 (Vernon 1989). This fact considered along with the Arkansas Code drafters’ expressed intent to pattern Arkansas theft provisions after Texas’s comparable laws, leaves little doubt that the “actor,” under § 5-36-101(11)(B), means an accused or defendant is entitled to deduct the amount of consideration he or she paid for the misappropriated property.

Thestate also argues that interpreting § 5-36-101(11)(B) to allow an accused to deduct consideration he or she paid in buying stolen property could lead to absurd results and, for that reason, the court should not give the statute such a construction. The state explains that it would be absurd to give a fence, or person who pays for stolen goods, a break by awarding him a deduction for the amount he paid, and the state further suggests the fence could all but escape criminal responsibility in the extreme case — where he or she pays the market value for known stolen goods. Of course, the statutory provision providing for such a credit is used only in determining the grade of the offense, viz., whether the offense is a class B or C felony or a class A misdemeanor. In other words, the ultimate value assigned property stolen does not, by itself, exonerate the culprit who stole, sold or bought the property from escaping all liability for committing the crime.

We must also reject the state’s suggestion that the deduction or credit provision in § 5-36-101(11)(B) should be limited only to situations involving persons who jointly own property with another and who convert it to their own use. Clearly, the language in § 5-36-101 (11)(B) provides credit to actors who not only have a legal interest in the stolen property but also those who pay consideration for the property. Such expansive language can in no way be read to exclude an actor or accused who committed theft by receiving.

Finally, the state argues that the evidence simply did not warrant an instruction containing the value deduction provision. It notes its witness testified that the stolen items were valued at $355 and that giving appellant credit for the $40 he paid for the items, the total amount remained in excess of $200, which made the offense a felony. The state’s argument ignores its own trial testimony that suggests that the VCR had no value if it was not working. The state’s witness also gave different values to the stolen television since some confusion existed concerning the television’s size. Terry Bruce, a state witness, was involved in stealing the VCR and other items for which the appellant was charged with having received, and Bruce testified that he had given a prior statement that the VCR did not work, that he believed it did not work and added that he had plugged in the VCR the night he got it and he could not get it to work. From our careful review of the record, we have no doubt that evidence was presented to support appellant’s claim that the value of the items, when stolen, could have been determined to be less than $200.

We now consider appellant’s second point for reversal. He argues that the trial court erred in denying his motion in limine to exclude evidence of marijuana and $618 cash that were found at appellant’s residence. Appellant simply failed to preserve his record on this point. This court has held that where\ judge does not make a final determinative ruling on a party’s motion in limine, the party must object at trial to the testimony in question in order to raise the issue on appeal. See Delta School of Commerce, Inc. v. Wood, 298 Ark. 195, 766 S.W.2d 424 (1989).

Appellant did not mention the $618 cash in his motion in limine, and in fact, he suggested his willingness at trial to stipulate that that amount in cash was found by officers at appellant’s residence. And with regard to the marijuana, appellant did include it in his pre-trial motion, but the trial judge was careful to explain to appellant that while the judge would not grant appellant’s motion, he suggested that appellant could make his objection at trial concerning the marijuana and the judge would rule on the objection at that time. At trial, the state’s witness Jerry Smith testified without objection that he and other officers had found $618 in cash and a quantity of marijuana during their search of appellant’s residence. Other state testimony was also presented concerning the marijuana, and it was admitted without objection.

For the reasons stated above, we reverse and remand.

Hickman and Hays, JJ., dissent.

Darrell Hickman, Justice,

dissenting. I would not give Ark. Code Ann. § 5-36-101(11)(B) (1987), the interpretation the majority does. It is ridiculous to say that a thief or one who knowingly buys stolen property can reduce the grade of his offense by getting credit for his illegal payment. We should not interpret statutes in a manner that will lead to absurd consequences. Dollar v. State, 287 Ark. 61, 697 S.W.2d 868 (1985).

First of all, § 5-36-101(11)(B) was not designed for use in a theft by receiving case. The statute’s purpose becomes apparent only in the context of an ordinary theft situation. For instance, A, B and C are joint owners of property. If A converts the entire property to his own use, the grade of his offense is not determined by the total value of the property, but by the total value, less A’s own legal interest. He is given credit for his legitimate interest in the property. Similarly, if a person has leased a business machine for a one year period and at the end of one year fails to return the machine, he may deduct the consideration he legitimately paid in lease payments.

The problem with using this statute in a theft by receiving case is that it can only come into play when the buyer’s interest or consideration paid are illegal. For example, if the buyer innocently purchases stolen goods, he simply has not committed the offense of theft by receiving. Ark. Code Ann. § 5-36-106(a) (1987). If he knowingly buys stolen goods, he has committed the offense and, the majority says, may deduct the amount he paid in the illegal transaction. Surely the legislature did not intend this serious breach of public policy.

The majority opinion does not recognize the element of legality that is necessary to achieve consideration. Consideration is generally defined as a legal detriment to one contracting party that results in a corresponding legal benefit to another. Cronk v. State, 100 Misc. 2d 680, 420 N.Y.S.2d 113 (1979); see also Black’s Law Dictionary at 278. Contracts based on illegal consideration are void. Peay v. Pulaski County, 103 Ark. 601, 148 S.W. 491 (1912); see a/so 17 Am. Jur. 2d Contracts § 17. The alleged “consideration” the appellant gave in this case is not consideration in the eyes of the law, and the statute should not be read to say that it is.

The majority tacitly recognizes this by failing to give the appellant credit for the marijuana he gave as “boot.” Strictly speaking, it was “consideration,” but obviously illegal. The same is true of money knowingly paid for stolen property.

The appellant claims the jury should have been instructed that, if the defendant gave consideration for the property, the amount of the consideration should be deducted in determining the value of the stolen property. Whether he was innocent or guilty, the appellant was not entitled to that instruction. If he innocently bought the stolen property, he did not commit the offense with which he was charged; if he knowingly bought the property, any consideration he gave was illegal and should not be considered for his benefit.

Hays, J., joins in the dissent.

       Appellant was convicted and sentenced to fifteen years on the controlled substance charge and that conviction was affirmed by the court of appeals in Campbell v. State, 27 Ark. App. 82, 766 S.W.2d 940 (1989).

       At trial, appellant testified that he did not know the goods he purchased were stolen and the seller did nothing to indicate they were.

       Appellant also suggests he should be able to deduct the value of marijuana he gave the person selling the stolen property, but we find such a suggestion wholly without merit. He offers no citation of authority and no convincing argument to support such a view.

       We note, however, that, under Ark. Code Ann. § 5-36-106(c), a person’s acquisition of property for a consideration known to be far below its reasonable value gives rise to a presumption that he knows or believes that the property was stolen, so to the extent a person pays an amount close to a property’s market value will certainly diminish the prospect of any such presumption arising.


author: Tom Glaze, Justice.

text:
    Margaret WEBB v. HCA HEALTH SERVICES OF MIDWEST, INC. d/b/a Doctors Hospital and Nicholas W. Riegler
    89-128
    780 S.W.2d 571
    Supreme Court of Arkansas
    Opinion delivered December 11, 1989

      Perroni, Rauls & Looney, P.A., by: Rita S. Looney, for appellant.

      Ford & Harrison, by: E. Scott Smith and Patricia G. Griffith; and Huckaby, Munson, Rowlett & Tilley, by: Mike Huckaby and Timothy L. Boone, for appellee HCA Health Services of Midwest, Inc.

      Friday, Eldredge & Clark, by: C. Tab Turner, for appellee Dr. Nicholas Riegler.
   Tom Glaze, Justice.

Appellant filed a complaint alleging a cause of action for intentional infliction of emotional distress, commonly referred to as tort of outrage, against HCA Health Services (HCA) and Dr. Riegler. HCA does business as Doctors Hospital. The appellant also filed a cause of action against HCA for wrongful discharge. HCA and Riegler answered denying appellant’s claims and Riegler moved to dismiss the claim against him based upon the statute of limitations. Dr. Riegler and HCA subsequently filed motions for summary judgment which the trial court granted in their favor on both the tort of outrage and wrongful discharge claims. Appellant appeals from the trial court’s granting of summary judgment and Dr. Riegler cross-appeals from the trial court’s denial of his motion to dismiss. We affirm the lower court decision denying appellant’s tort of outrage claims, but reverse and remand the wrongful discharge claim against HCA.

Because this appeal is from the trial court’s granting of summary judgment, our review is limited and focuses on the pleadings, deposition testimony and other documents filed by the parties in support of their respective arguments. From that record, the following relevant facts and events are disclosed. HCA entered into a Memorandum of Understanding with the Arkansas Foundation of Medical Care (AFMC) pursuant to 42 U.S.C. § 1395cc(a)(l)(F), which requires providers of health services to maintain an agreement with a professional standards or quality control organization that addresses utilization and quality control, including the appropriateness of admissions. In this connection, HCA employed appellant as a utilization review coordinator, and in that capacity, appellant reviewed the charts of Medicare and Medicaid patients to determine if their admissions and lengths of stay complied with criteria set out by AFMC. This review process is a part of a federal government program dealing with the cost containment of services. If, in appellant’s opinion, the admissions or stays did not comply with criteria, she reported that fact to the designated physician advisor who assessed whether additional diagnoses should be made or the underlying charting improved so as to certify additional hospital days for the patient. To meet its obligations under the federal program, AFMC conducted independent audits of patient charts.

Dr. Riegler made no secret of the fact he disliked this utilization review procedure. He voiced criticism that his charts were out for review when he made hospital rounds and complained to Ms. Chandler, appellant’s supervisor. Apparently, Dr. Riegler had been placed on 100 % review so every chart of all his patients had to be reviewed. Ms. Chandler instructed appellant to avoid Dr. Riegler and to review his charts retroactively rather than reviewing the charts of patients upon their admissions and periodically thereafter.

In late December 1986 or early January 1987, appellant had problems when reviewing two of Dr. Riegler’s patient charts, and in discussing the matter with Ms. Chandler, appellant claims Chandler asked her to submit false information regarding these two Medicaid patients’ charts. Appellant refused, claiming the number of days the two patients spent in the hospital did not meet the AFMC criteria. Chandler eventually certified the days and told appellant to place the certification documents with the patients’ charts, which appellant did.

On January 13, 1987, the appellant was reviewing charts when Dr. Riegler made his rounds, and upon seeing appellant, Riegler went to Chandler to complain. Appellant was called to Chandler’s office and informed of Dr. Riegler’s complaints. Appellant was later terminated on January 22, 1987.

Appellant filed suit in March 1988, and in her count against Dr. Riegler alleged that he had made derogatory comments about her in the presence of others, had made unwarranted complaints to her supervisors, caused severe difficulty in her performing her duties and encouraged her supervisors to terminate her. In her deposition, however, appellant conceded that (1) she did not know if Dr. Riegler took part in or forced the hospital’s decision to fire her, (2) Dr. Riegler did not make derogatory comments directly to her but told others within hearing that utilization review was “stinky,” and (3) in general, Dr. Riegler had a problem with the utilization review process. Appellant further offered evidence that Dr. Riegler had told appellant (and a coworker) not to touch his charts, that Riegler had threatened to sue everybody connected with the review procedure and that he was verbally abusive to the utilization review coordinators, which included appellant.

Even when viewing the foregoing evidence most favorably to appellant, as we are required to do, it simply fails to support a claim for the tort of outrage. In Ingram v. Pirelli-Cable Corp., 295 Ark. 154, 747 S.W.2d 103 (1988), we stated that the type conduct that meets the standard of an outrage cause of action must necessarily be decided on a case-by-case basis. We further noted that this court had taken a somewhat strict approach to this new tort or cause of action. Id.; Sterling v. Upjohn Health Servs., 299 Ark. 278,772 S.W.2d 329 (1989). As established in M.B.M. Co. v. Counce, 268 Ark. 269, 596 S.W.2d 681 (1980), in order to sustain a claim for outrage, conduct must be so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized society. We hold that standard was not met by the appellant in her outrage claim here against Dr. Riegler.

We also find appellant’s record insufficient concerning her outrage claim against HCA. In addition to her allegations concerning Chandler asking her to falsify records, appellant claimed that HCA misrepresented appellant’s cause of her termination when appellant applied for unemployment benefits. HCA claimed that appellant was discharged for not maintaining positive physician relationships and thát she was insubordinate on January 13, 1988, in disobeying her supervisor’s directions.

Appellant, in her deposition, stated that, in terms of Medicaid reimbursement to the hospital, she did not know if it mattered what she certified as a result of review of patient charts, and she further offered that she did not know if Chandler was trying to defraud the government. When asked why she thought the incident between her and Chandler concerning Dr. Riegler’s charts had anything to do with her discharge, she replied that Chandler seemed angry with appellant and it was the only time appellant had not done what she was asked to do. Finally, appellant described her encounter with Chandler by saying she refused Chandler’s instructions to certify certain patient in-house (hospital) days and shoved the document (abstract) back to Chandler, who completed and certified the days instead.

Although we hold appellant’s allegations and evidence are insufficient to show a tort of outrage claim, we do believe, when viewing the evidence in her favor, a fact issue exists regarding her wrongful discharge cause of action against HCA. In Sterling Drug, Inc. v. Oxford, 294 Ark. 239, 743 S.W.2d 380 (1988), we adopted the rule that if an employee is discharged for exercising a statutory right, or for performing a duty required by law or the reasons for the discharge was in violation of some other well established public policy, we would recognize the employee’s wrongful discharge claim as an exception to the employment at will doctrine.

In reviewing motions for summary judgment, the burden is one the moving party to demonstrate that there is no genuine issue of fact for trial. Prater v. St. Paul Insurance Co., 293 Ark. 547, 739 S.W.2d 676 (1987). Summary judgment is not proper where evidence, although in no material dispute as to actuality, reveals aspects from which inconsistent hypotheses might reasonably be drawn and reasonable men might differ. Id. In the present case, HCA states that the appellant was terminated for reasons unrelated to any alleged violation of public policy. Further, HCA argues, or at least implies, that the appellant did not know how to evaluate or review the charts she discussed with Chandler, and besides it did not matter how she evaluated the AFMC criteria and the two disputed charts because her actions did not bear on whether Medicaid reimbursements were made. Such arguments ignore the fact that the entire reason for appellant’s employment with HCA arose out of federal statutory and regulatory requirements that are designed to contain medical costs. AFMC criteria are employed to further that purpose, and utilization coordinators like the appellant, are, at least in some part, provided to implement this federal program. Appellant alleged and testified that she was told to falsify records which she is required to complete and certify. HCA, on the other hand, summarizes its position by saying appellant was not requested to falsify anything but she simply did not know how to review the two disputed charts. Undoubtedly an employer’s request to falsify a business record used in achieving the purposes of a program required by law of medical providers violates public policy.

It may well be that when further evidence is presented at trial, HCA may sustain its position that appellant altogether failed in performing her duties which caused her termination and no falsification existed or was intended. The state of the record on motion for summary judgment does not resolve that fact issue, and therefore, we reverse and remand this cause for trial on the wrongful discharge issue.

Because we affirm the trial court’s decision dismissing the tort of outrage claims against HCA and Dr. Riegler, we need not address Riegler’s cross-appeal. For the reasons stated above, we affirm in part and reverse and remand in part.

Hickman, J., would affirm on all points.

       Appellant’s application for benefits had “insubordination” as the reason for termination, but she denied she provided that reason. The Arkansas Appeal Tribunal found appellant did not defy a direct order, was not insubordinate and awarded her benefits.


text:
    GARVER & GARVER, P.A. v. LITTLE ROCK SANITARY SEWER COMMITTEE
    89-12
    781 S.W.2d 24
    Supreme Court of Arkansas
    Opinion delivered December 11, 1989
    [Rehearing denied January 8, 1990.]

      Wright, Lindsey & Jennings, for appellant.

      Wallace, Dover & Dixon, by: Don F. Hamilton, for appellee.

      Holt, C.J., and Turner, J., not participating.

   Wm. R. Wilson, Jr., Special Chief Justice.

On November 5, 1975, the appellee/cross-appellant, Little Rock Sanitary Sewer Committee (Committee), entered into a contract with appellant/cross-appellee, Garver & Garver, Inc. (Garver) for engineering services in connection with the construction of the Fourche Wastewater Treatment Facility in Little Rock, Arkansas. Thereafter, other contracts were entered into between the parties for other engineering services during this construction.

Nielsons, Inc. (Nielsons), became the prime contractor. Georgia A. Hormel and Company (Hormel) contracted to supply the Rotating Biological Contractors (RBC) equipment for the plant.

Construction of the plant was completed in 1983. After operating for approximately one and one-half years, it became apparent that the plant was not capable of meeting design performance specifications. In September of 1985 the Committee filed suit for damages against Garver, Nielsons, Hormel and the bonding companies for Nielsons and Hormel. Subsequently, the complaint was amended to add the manufacturer of the RBC equipment.

After extensive discovery, the Committee entered into a settlement agreement with Hormel and Nielsons, and then dismissed its lawsuit against all defendants except Garver. As a part of the settlement, Nielsons and Hormel agreed to pay $2,500,000 to the Committee and to forgive the retainage held by the Committee. The retainage was $150,000, making the total settlement consideration $2,650,000. The Committee reserved and preserved its rights to pursue its lawsuit against Garver. The settlement agreement otherwise provided in pertinent part as follows:

It is further agreed by the Sewer Committee that in the event other parties are responsible to the Sewer Committee for claims or damages resulting from the above-described disputed activities, the execution of this release shall operate as a satisfaction of any claims which the Sewer Committee might have against such other parties to the extent of the pro rata share of fault and/or liability of the parties herein released. Specifically, without limiting the applicability of the foregoing, it is expressly agreed that the Sewer Committee may continue to pursue this suit or initiate any other suit against Garver and that Garver is not released hereby except to the extent of the pro rata share offault and/or liability of the parties released herein. (Emphasis supplied.)
The Sewer Committee hereby covenants and agrees that it will seek no judgment or amount in the captioned case or any other case as to the disputed activities against Garver or any other party in excess of Garver’s or such other party’s pro rata share of fault. It is specifically the intent and effect of this covenant and this release to give the released parties final peace from any contribution, indemnity, or other claims against the released parties by other parties responsible to the Sewer Committee for claims or . damages resulting from the disputed activities. If, contrary to the intent of this paragraph, the Sewer Committee recovers damages arising out of the disputed activities against Garver or any other parties and then Garver or other parties recover such damages against any of the released parties, the Sewer Committee shall reimburse the released party or parties for such damages which they paid.
It is specifically the intent of this settlement agreement that the Sewer Committee may continue the litigation or any other litigation against Garver or any other persons, firms, corporations, or legal entities subject to the terms and conditions of this agreement. For this purpose, subject to the pro rata release contained in paragraphs 6 and 7 of this agreement, the Sewer Committee reserves its rights against Garver and other parties not parties to this agreement to pursue and collect damages from Garver or such other parties equal or attributable to Garver’s or such other parties’ pro rata share of fault arising out of the disputed activities.

The case proceeded to trial on plaintiffs fourth amended complaint which was against Garver only. At the close of the evidence, and after the instructions, the court submitted the case to the jury on interrogatories. The pertinent interrogatories and the jury’s answers thereto are as follows:

Interrogatory No. 1: Do you find from a preponderance of the evidence that Garver & Garver was guilty of negli gence which was a proximate cause of the occurrence? [Emphasis supplied.]
Answer: Yes.
Interrogatory No. 2: State the amount of damages which you find from a preponderance of the evidence were sustained by the Little Rock Sanitary Sewer Committee as a result of the occurrence.
Answer: $3,000,000.00 [Signed by ten jurors.]
Interrogatory No. 3: Do you find from a preponderance of the evidence that Hormel’s RBC equipment failed to meet the performance required by the specification and such failure was covered by Hormel’s guarantee and Hormel was, therefore, liable by reason of the guarantee. [Emphasis supplied.]
Answer yes or no.
Answer. [Yes was circled.]
If you answer the interrogatory “yes,” then state what you find the extent (percentage) of liability of Hormel to be.
Answer: 50% [Signed by eleven jurors.]

One pertinent jury instruction was the following:

In these instructions and interrogatories I have used the term ‘occurrence.’ The term ‘occurrence’ has reference to the design of the Fourche Wastewater Treatment Plant, which the Little Rock Sanitary Sewer Committee contends caused its damages.

Garver objected to this instruction on the grounds that there was no need to define the word “occurrence” and, further, for the reason that it was not accurately defined.

The court further instructed the jury that:
The Little Rock Sanitary Sewer Committee is claiming damages from Garver & Garver for negligence and has the burden of proving each of three essential propositions:
First: That it has sustained damages;
Second: That Garver & Garver was negligent; and
Third: That such negligence was the proximate cause of the Little Rock Sanitary Sewer Committee’s damages.
The court also instructed:
If an interrogatory requires you to assess the damages for the occasion [sic] to Little Rock Sanitary Sewer Committee, you must then fix the amount of money which will reasonably and fairly compensate the Little Rock Sanitary Sewer Committee for the following two elements of damage sustained:
First: The reasonable and necessary cost of modifications and additions required to enable the Fourche waste-water treatment plant to operate in accordance with the contract performance specifications.

Garver objected to this instruction on the ground that it did not make specific reference to the amount plaintiff" had already recovered in the way of settlement.

After considering post-trial motions filed by both parties, the court entered judgment on July 11, 1988, which set forth the above jury interrogatories and answers and otherwise provided in relevant part as follows:

Based upon the jury’s answers to these interrogatories and the undisputed evidence in this case, including but not limited to the prior settlement between plaintiff" and the original defendants except Garver, the Court finds that defendant Garver is liable for 50 percent of the total amount of damages indicated in the jury’s answer to Jury Interrogatory No. 2, i.e., $3,000,000, because of the jury’s answer to Jury Interrogatory No. 3 in which the jury found that defendant Garver is liable for 50 percent of the damages of $3,000,000, or $1,500,000; and said defendant’s cross-complaint against cross-defendants Hormel and Nielsons should be dismissed with prejudice, and judgment is entered against Garver in the sum of $1,500,000.

Garver appeals, contending that Hormel was one hundred percent liable for the failure of the plant to meet specifications, and that, therefore, the settlement agreement specifically released Garver from any liability, and that it was entitled to judgment as a matter of law. In the alternative, Garver contended that the total damage sustained by the Committee was $3,000,000 and that the trial court should have reduced the judgment against Garver by the settlement sum of $2,650,000, i.e., that the total judgment against Garver should be in the amount of $350,000.

The Committee cross-appeals, contending that it was entitled to judgment for the full amount of damages set forth in the answer to Interrogatory No. 4 (three million dollars).

Despite the fact that the jury found that Hormel’s liability was fifty percent as a result of its breach of its guarantee that its RBC equipment would perform properly, Garver insists that Hormel is one hundred percent liable upon this guarantee.

The pertinent instructions and interrogatories are not models of clarity. We note, however, that neither party to this appeal asks that the case be remanded. The court is intrigued by Garver’s assertion that Hormel was one hundred percent liable (in the face of the jury verdict), primarily because of the vigor with which this point has been urged by Garver in pre-trial pleadings, at the trial, in post-trial motions and on appeal. Garver, however, cites no authority for its position on this point, and we can find none.

The Committee argues, first, that Garver was guilty of fault in areas of the construction which were not directly related to the fault of Hormel in breaching its guarantee. Garver disputes this assertion, and the record, as we view it, is not entirely clear on this point. Be that as it may, Garver was found guilty of negligence which was a proximate cause of the damages in this case. Even assuming that Garver was negligent solely in failing to properly supervise Hormel in performing its contractual duties, Garver would not be absolved of liability in view of the jury’s findings. See Carroll-Boone Water Dist. v. M. & P. Equipment Co., 280 Ark. 560, 661 S.W.2d 345 (1983); see also Scott v. Potomac Ins. Co. of the District of Columbia, 217 Or. 323, 341 P.2d 1083 (1959); Willner v. Woodward, 201 Va. 104, 109 S.E.2d 132 (1959).

Accordingly, we reject Garver’s first point on appeal.

In the alternative, Garver contends that it is entitled to a credit of the settlement amount of $2,650,000. Garver specifically contended, however, in its brief and during oral argument that “this is not a joint-tortfeasor situation” since Garver’s liability was based upon negligence (fault) while Hormel’s liability is based upon contract (guaranty). Thus, we do not reach the question of whether the Uniform Contribution Among Tortfeasors Act, Ark. Code. Ann. § 16-61-204 (1987) would have been applicable.

Garver contends, however, that it is entitled to a credit “as a matter of equity” under Woodard v. Holliday, 235 Ark. 744, 361 S.W.2d 744 (1962). In that case, we simply approved language from the annotation at 42 A.L.R.2d 958 which reads as follows:

A master and servant are each liable for injuries caused by the negligence of the servant in the course of his employment. The servant is liable because he committed the tort and the master is liable under the doctrine of respondeat superior. While they may not be joint tortfeasors in the sense that their joint acts caused an injury, a majority of the courts hold that their liability is joint and several and each is liable to the full extent of the injuries and they may be joined in an action in the same measure as joint tortfeasors. The law of joint tortfeasors relating to releases and covenants not to sue is applicable.

As is set forth above, however, in this case Garver specifically and steadfastly contended that the parties were not joint tortfeasors. We, therefore, also reject this contention.

The Committee, as cross-appellant, contends that it should be presumed that the jury fixed the damages at $3,000,000 above the settlement figure of $2,650,000 because the settlement agreement, which included the settlement figure of $2,650,000, was introduced into evidence.

The settlement agreement expressly provided that, “Garver is not released hereby except to the extent of the pro rata share of fault and/or liability of the parties released herein.” (Emphasis supplied.) It is clear under Arkansas law that fault in terms of negligence and fault in terms of contractual breaches can be compared by the jury.

Ark. Code Ann. § 16-64-122(c) (1987) provides as follows:

The word ‘fault’ as used in this section, includes any act, omission, conduct, risk assumed, breach of warranty, or breach of any legal duty which is a proximate cause of any damages sustained by any party. (Emphasis supplied.)

In arguing that it should be presumed that the jury took into account the settlement figure and that, therefore, it is entitled to a $3,000,000judgment, the Committee cites Arkansas Craft Corp. v. Johnson, 257 Ark. 629, 519 S.W.2d 74 (1975); Gailey v. Stewart, 236 Ark. 80, 364 S.W.2d 662 (1963); and Giem v. Williams, 215 Ark. 705, 222 S.W.2d 800 (1949). Each of these cases is distinguishable.

In Giem, the plaintiff settled with one of two joint tortfeasors just before the trial for the sum of $4,000. The case went to trial against the other tortfeasor and resulted in a verdict and judgment for $8,950. During the course of the trial, the settlement agreement (covenant not to sue) with the settlement figure of $4,000 was introduced. When the trial court refused to give the appellant credit for the $4,000 settlement, the appeal was taken. We held that “in such circumstances, appellants were not entitled to have the court — after the verdict — make the allowance again.”

In Giem, the case was submitted to the jury on a general verdict; but, as we pointed out, in Bailey v. Stewart, supra, a case submitted on a general verdict (such as Giem) does “not quite reach the point at issue” when the case is submitted on interrogatories.

In Bailey v. Stewart, the settling tortfeasors paid $9,000 prior to trial, and this was introduced into evidence against the remaining tortfeasor. The jury returned the verdict for $10,000 for the husband-plaintiff, and the defendant-appellant contended that he should have been given credit for the settlement amount and, therefore, the judgment should have been in the sum of $1,000 vice $10,000.

The case was submitted to the jury on interrogatories and the crucial interrogatory read as follows:

What do you find from the evidence, if any, to be the actual damages sustained by the plaintiff, John L. Stewart, if any, without reference to the amount of payment in settlement as made by Jimmy F: Cossey and Don D. Duvalll (Emphasis supplied.)

The appellee argued that the italicized clause was the equivalent of “after first having deducted” the amount of the Cossey-Duvall settlement payment. We rejected this contention and stated, “we find it impossible to hold that a finding of the actual damages ‘without reference’ to the amount of a compromise settlement is in effect a finding of those damages after the amount of the settlement has been taken into account.”

The case was remanded to the circuit court for a new trial in accordance with the alternative prayer of the appellee. There was no language in any interrogatory in the case at bar which was similar to the language in Bailey, and, further, the Committee declined to request a remand in the conclusion of its brief and again during oral argument.

Arkansas Kraft Corporation, supra, (evidently a general verdict case), is not helpful because it simply held that it was not error for the trial court to allow the plaintiff to introduce evidence of a pre-trial settlement with another tortfeasor.

In the case at bar, the instruction in which the trial court defined the word “occurrence” is as follows:

In these instructions and interrogatories I have used the term ‘occurrence’. The term ‘occurrence’ has reference to the design of the Fourche Wastewater Treatment Plant, which the Little Rock Sanitary Sewer Committee contends caused its damages ....

The jury interrogatory (which was answered by the jury in the sum of $3,000,000), read as follows:

State the amount of damages which you find from a preponderance of the evidence which were sustained by the Little Rock Sanitary Sewer Committee as a result of the occurrence. . . .

Additionally, the court instructed the jury as follows:

If an interrogatory requires you to assess the damages for the occasion [sic] to Little Rock Sanitary Sewer Committee, you must then fix the amount of money which will reasonably and fairly compensate the Little Rock Sanitary Sewer Committee for following two elements of damages sustained:
First: The reasonable and necessary cost of modifications and additions required to enable the Fourche waste-water treatment plant to operate in accordance with the contract performance specifications; and
Second: The reasonable and necessary expenses incurred by the Little Rock Sanitary Sewer Committee for tests conducted to determine the cause of the Fourche wastewater treatment plant’s failure to operate in accordance with contract performance specifications.

Garver objected to the two above quoted instructions, both offered by the Committee, and specifically stated that the last quoted instruction “makes no reference whatsoever to the fact that the Plaintiff has already recovered ... by settlement. . . $2,650,000.”

Perhaps it would have been better if the instructions or interrogatories had directed the jury to fix the amount of damages after first deducting the settlement amount, but it is obvious, by the terms of the judgment entered, that the trial court found that the $3,000,000 figure was the global amount of damages. Under these particular facts, we cannot say that the trial court was clearly erroneous, especially when the complaining party expressly declined to ask for a remand. Accordingly, we reject the Committee’s contention on this point.

Affirmed.

Holt, C.J., not participating.

Glaze, J., concurs.


author: Per Curiam.

text:
    Bilal Ali SALAM, a/k/a Kevin Andre Robinson v. STATE of Arkansas
    RC 89-61
    781 S.W.2d 30
    Supreme Court of Arkansas
    Opinion delivered December 11, 1989

      Daivd Hodges, for petitioner.

      Steve Clark, Att’y Gen., by: Clint Miller, Asst. Att’y Gen., for respondent.
   Per Curiam.

The petitioner was convicted on July 2,1981, of rape and attempted rape and sentenced to consecutive terms of imprisonment of fifty and twenty years. This court affirmed. Robinson v. State, 275 Ark. 473, 631 S.W.2d 294 (1982). On October 21,1981, he was convicted of a second count of rape and sentenced to twenty-five years imprisonment to be served consecutively to the earlier two sentences. The Court of Appeals affirmed. Robinson v. State, CACR 82-15 (August 25,1982). On November 19, 1981, he was convicted of attempted rape and sentenced to an additional consecutive term of twenty-five years imprisonment. No appeal was taken from this last conviction.

Petitioner exhausted his state remedies and filed petitions for writs of habeas corpus in federal court pursuant to 28 USC § 2254 challenging the convictions of July 2 and October 21,1981. According to the brief filed by petitioner’s counsel in the Eighth Circuit Court of Appeals, the issue of whether petitioner was denied his right to appeal the November 19,1981 conviction due to ineffectiveness of counsel was not raised in the initial petitions. Nevertheless, it was determined by the federal court that the November conviction was covered by the habeas corpus proceedings in federal district court where Judge Eisele found that counsel had “completely abdicated his responsibility to represent petitioner on appeal.” Judge Eisele concluded that the petitioner should be afforded the opportunity to take a direct appeal of the November conviction for attempted rape and that in the event the state failed to afford him such an opportunity, the writ of habeas corpus would issue vacating the conviction. The order of the federal district court, which should be entered shortly, will direct the state to allow petitioner to file a belated direct appeal of his conviction within one hundred twenty days or the writ will issue. In all other respects, relief was denied by the federal court. The state has now joined with counsel for petitioner in requesting a belated appeal of the November 19, 1981 conviction for attempted rape.

Although petitioner’s counsel, Mr. David Hodges, has not been formally appointed by this court, in connection with present state proceedings, we now appoint him for that purpose. Before granting any belated appeal, however, we remand this case to the trial court for an evidentiary hearing on whether the petitioner waived his right to appeal the November 19, 1981 conviction. We remand this matter recognizing that the federal district court apparently held a hearing on this issue and concluded the petitioner was entitled to a belated appeal. However, we have nothing before us that reflects whether petitioner waived or did not waive an appeal regarding the attempted rape conviction. Therefore, we direct the trial court to conduct its own evidentiary hearing concerning the waiver issue. At the conclusion of that hearing, the court is directed to make its findings and conclusions and to have the record on this issue transcribed, certified and returned to this court for review. The hearing, the court’s findings, and the record shall be held, entered and filed within sixty days from the date of this per curiam. After the filing of the record with this court, we will then instruct both the petitioner’s counsel and the state on whether briefing and arguments are necessary on the issue of waiver. Upon resolution of that issue, this court will promptly make a determination as to whether or not a belated appeal will be granted.

       After the Eighth Circuit Court of Appeals affirmed the District Court’s finding that the petitioner had been denied his constitutional right to a belated appeal, there was really no practical advantage in the state’s filing a petition for writ of certiorari to the United States Supreme Court since the issue was essentially a fact question; the law is well settled on the right to effective assistance of counsel on appeal.


author: Jack Holt, Jr., Darrell Hickman,

text:
    FIRST NATIONAL BANK of Izard County v. ARKANSAS STATE BANK COMMISSIONER and the Bank of North Arkansas
    89-133
    781 S.W.2d 744
    Supreme Court of Arkansas
    Opinion delivered December 18, 1989

      Ivester, Skinner & Camp, P.A., by: Hermann Ivester and Valerie F. Boyce, for appellant.

      Steve Clark, Att’y Gen., by: Joseph V. Svoboda, Asst. Att’y Gen., for appellee Arkansas State Bank Commissioner.

      Highsmith, Gregg, Hart, Farris & Rutledge, by: John C. Gregg; and Wilson, Engstrom, Corum & Dudley, by: Wm. R. Wilson, Jr. and Gary D. Corum, for appellee The Bank of North Arkansas.
   Jack Holt, Jr.,

Chief Justice. On September 27,1988, the appellee, The Bank of North Arkansas (BNA), which has its principal bank located in Melbourne, Arkansas, filed an application with the appellee, Arkansas State Bank Commissioner (Commissioner), requesting permission to establish a branch bank in Calico Rock, Arkansas, where the appellant, First National Bank of Izard County (FNB), has its principal bank located. FNB objected to BNA’s application, although it had recently opened a branch bank in Melbourne, and filed a formal protest, pursuant to Ark. Code Ann. § 23-32-1203(d) (1987), and requested interrogatories from BNA on October 13,1988. Calico Rock is located in Izard County, and both BNA and FNB have their main offices in Izard County.

On October 20,1988, the Commissioner responded by letter to FNB’s interrogatory request and stated that BNA would not be required to answer the interrogatories until he had determined if a hearing would be necessary. FNB protested this decision on October 24, 1988. The next day, a state bank examiner filed a report recommending approval of BNA’s application.

The Commissioner advised both parties on October 26, 1988, that an administrative hearing was not necessary and that, as a result, BNA was not required to answer FNB’s interrogatories. Subsequently, on October 31, 1988, the Commissioner entered his order approving BNA’s application.

FNB requested in writing, on November 28,1988, a copy of the bank examiner’s report, which was sent by the Commissioner two days later. FNB then filed a petition for review in the Circuit Court of Pulaski County and obtained a stay of the Commissioner’s order.

The Commissioner’s order was affirmed by the circuit court on March 21,1989. Thereafter, FNB filed a notice of appeal and obtained a stay from this court conditioned upon FNB’s filing a proper supersedeas bond.

FNB appeals the Commissioner’s order granting approval of SNA’s application for a branch bank in Calico Rock based on three points of error: 1) that the order is in violation of constitutional and statutory provisions and made upon unlawful procedure, 2) the statute allowing discretionary hearings in protested cases is unconstitutional, and 3) the findings of fact in the order are in violation of statutory provisions and are not supported by substantial evidence. In addition, FNB requests that any remand to the Commissioner should specify procedures required to uphold statutory and constitutional provisions.

We find no merit in FNB’s points on appeal and affirm.

VIOLATION OF CONSTITUTIONAL AND STATUTORY PROVISIONS

FNB initially contends that the Commissioner’s order is in violation of constitutional and statutory provisions and made upon unlawful procedure. FNB bases this argument on the perception that its rights to due process have been denied due to the discretionary authority imbued in the Commissioner to grant or deny an application for a branch bank without an adjudicatory hearing. FNB claims that it has a franchise, by virtue of being a federally chartered bank, and that its due process rights can only be preserved and protected through a hearing at which all parties offer evidence.

The pertinent legislation regarding the procedure of establishing a full service branch office is contained in Ark. Code Ann. § 23-32-1203 (Supp. 1989), which provides in pertinent part as follows:

(c) Notice of the filing of the application shall be given by the commissioner to every other bank in the city or town in which the branch applicant bank is located. This notice shall be given by mail.
(d)(1) Any formal protest to a branch bank application must be received in writing detailing the reasons for protest within fifteen (15) calendar days of the date the commissioner’s notice of an application was mailed.
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(e) An adjudicatory or administrative hearing shall not be required on a branch bank application.

The first rule of construction as to a piece of legislation is to construe it just as it reads, giving the words their ordinary and usually accepted meaning in common language. Eldridge v. Board of Correction, 298 Ark. 467, 768 S.W.2d 534 (1989) (citing Bolden v. Watt, 290 Ark. 343, 719 S.W.2d 428 (1986)).

In addition to the principle that statutes are presumed not to be unconstitutional, Craighead County Bd. of Educ. v. Henry, 295 Ark. 242, 748 S.W.2d 132 (1988) (citing HCA Medical Services of Midwest, Inc. v. Rodgers, 292 Ark. 359,730 S.W.2d 229 (1987)), we have also recognized that administrative agencies are better equipped, by specialization, insight through experience, and more flexible procedures, than courts to determine and analyze underlying legal issues affecting their agencies, which accounts for the limited scope of judicial review of administrative action and the refusal of the court to substitute its judgment and discretion for that of the administrative agency. Arkansas State Hwy. Comm’n v. White Advertising Int’l, 273 Ark. 364, 620 S.W.2d 280 (1981) (citing Gordon v. Cummings, 262 Ark. 737, 561 S.W.2d 285 (1978)).

Generally, the basic constitutional due process requirements of notice and a reasonable opportunity to be heard are mandatory prerequisites to divest a property owner of his interest. Wallace v. Missouri Improvement Co., 294 Ark. 99, 740 S.W.2d 920 (1987). Although we agree that FNB has a constitutionally protected right to exercise the property interest vested in its franchise free from unlawful competition and therefore has standing to challenge unlawful competition, see Frost v. Corporation Comm’n, 278 U.S. 515 (1929); Webster Groves Trust Co. v. Saxon, 370 F.2d 381 (8th Cir. 1966), the pivotal question is whether due process gives FNB the right and standing to challenge lawful competition and, if so, how much due process must be afforded to this right and did FNB receive at least the minimum necessary to survive this constitutional challenge?

An illustrative discussion of this issue is presented in C. Koch, Administrative Law and Practice 564-67 (1985):

Indeed, over the years, the Supreme Court often has rejected the argument that trial-type procedures always are required by the Due Process Clause. [‘Once it is determined that due process applies, the question remains what process is due.’] The procedural components that will satisfy the Due Process Clause’s requirements will vary from situation to situation. The proper combination of procedures must reflect a practical solution sensitive to both the individual’s rights and the purpose of the administrative program.
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Perhaps the most influential effort to develop a technique for analysis is Justice Powell’s opinion in Mathews v. Eldridge [424 U.S. 319 (1976). Eldridge had been receiving social security disability benefits, but a state agency terminated his eligibility. Eldridge submitted a written protest to the agency, but otherwise had no opportunity, prior to termination, to participate in the decisionmaking.]. The only issue before the Court was whether the agency had accomplished the termination of Eldridge’s benefits according to due process requirements.

In answering this question, Justice Powell focused on three factors critical to this analysis:

First, the private interest that will be affected by the official action; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, of additional or substitute procedural safeguards; and finally, the Government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.

Using this analysis, we conclude that FNB’s due process rights were not violated. Under the first factor, FNB is only indirectly affected because it does not have an exclusive license to operate in the area where BNA requested to establish a branch, and approval of the branch application does not exclude FNB from operating in that area. The aspect of resulting competition was specifically addressed in the bank examiner’s report:

The protest lodged by FNB contends that the approval of the proposed branch will have a detrimental effect on the competition in Calico Rock. FNB has consistently reported earnings in the 90th percentile of its peer group. Capitalization is in the upper 90th percentile of its peer group. The cost of funds is well below 4.50 %. The contention is perhaps well founded due to the fact that the bank [FNB] will have to meet the challenge of competition. However, there is no evidence submitted to support irreparable harm will be committed due to the introduction of competition.
The approval of the applicant’s request will afford the populace of the trade area a choice of banking institutions, therefore promoting public convenience.

The second factor, addressing the risk of an erroneous deprivation of FNB’s interest through the procedures used and the probable value, if any, of additional or substitute procedural safeguards, also favors upholding the constitutionality of the statutory provisions.

Although section 23-32-1203(e) does not require a formal hearing, other provisions included in that section adequately protect FNB’s rights under these circumstances. Specifically, 1) subsection (c) requires that notice of the filing of the application be given to every other bank in the city or town in which the branch applicant bank is located, 2) subsection (d) provides for the protest of a branch bank application, (3) subsection (f) states that the commissioner’s decision on a branch bank application will be in the form of final findings of fact, conclusions of law, and that the order be given by the commissioner within a reasonable time period, and 4) subsection (g) allows an applicant or official protestant thirty calendar days in which to appeal the commissioner’s order to the appropriate circuit court.

In this case, the commissioner clearly gave FNB notice of BNA’s branch bank application, which FNB protested. The commissioner issued findings of fact and conclusions of law in its order dated October 31, 1988, and FNB exercised its right to appeal the order to the Pulaski County Circuit Court.

These procedural safeguards are sufficient to protect FNB’s interest. The value of additional safeguards requested by FNB, in the form of discovery and a hearing, is outweighed by the resultant increase in administrative burdens, addressed in Justice Powell’s third factor to be considered.

Finally, FNB argues that section 25-15-208(a)(3) of the Administrative Procedure Act, providing that in “every case of adjudication . . . [opportunity shall be afforded all parties to respond and present evidence and argument on all issues involved,” conflicts with section 23-32-1203(e) in the branch banking subchapter, which unequivocaly states that an “adjudicatory or administrative hearing shall not be required on a branch bank application.”

Section 25-15-211, addressing licenses in administrative adjudications, provides as follows: “(a) When the grant, denial, or renewal of a license is required by law to be preceded by notice and an opportunity for hearing, the provisions of this subchapter concerning cases of adjudication apply.”

Thus, the discretionary authority for an adjudicatory or administrative hearing contained in section 23-32-1203(e) precludes the application of section 25-15-208(a)(3) by virtue of section 25-15-211. Simply stated, in this case the Administrative Procedure Act does not apply to the activities of the Commissioner.

In summary, the Commissioner’s action does not affect FNB’s authority or right to conduct its banking operations. The establishment of a branch bank by BNA does not constitute unlawful competition. The Commissioner complied with the statutory requirement of notice and a reasonable opportunity to be heard. Finally, neither the language nor the meaning of Ark. Code Ann. § 23-32-1201 (1987 and Supp. 1989) et seq. is ambiguous, and the Commissioner’s decision not to have a hearing is within his discretion.

Thus, we find the statute is not in violation of constitutional prerequisites.

DISCRETIONARY HEARING UNCONSTITUTIONAL IN PROTESTED CASES

FNB contends that the statute allowing discretionary hearings in protested cases is unconstitutional unless it is interpreted to allow a discretionary waiver of a hearing in non-protested cases.

As noted previously, statutes are presumed not to be unconstitutional, Craighead County Bd. of Educ., supra, and all doubts must be resolved in favor of upholding its constitutionality. Holland v. Willis, 293 Ark. 518, 739 S.W.2d 529 (1987).

Additionally, a rational basis for the discretionary hearings can be found in the analogous case of Webster Groves Trust Co., supra, where the Eighth Circuit Court of Appeals discussed the rationale for not requiring the Comptroller of Currency to hold a formal hearing at which commercial banks could present objections relative to issuance of new national bank charters:

The very nature of the decision required by the Comptroller indicates that a formal adversary type hearing would be of little benefit to him in the discharge of his discretionary powers. There is the further factor present that if bank applicants were subjected to severe public cross-examination, public presentation of unfavorable evidence and were forced to disclose their future plans and programs to competitors, public confidence in the banking system could be adversely affected.

In discussing the discretionary nature of the Comptroller’s underlying actions, the court in Webster Groves Trust Co., supra, stated:

We believe that competing banks, as interested parties, have a right to challenge illegal acts of the Comptroller and that the Comptroller’s discretionary actions are not immunized from judicial review, but we also believe that neither the National Banking Act, 12 U.S.C. § 21 et seq., the Administrative Procedure Act, nor procedural due process requires a formal hearing of the type sought by appellant.

Also, FNB’s sole reliance on Pulaski County v. Commercial Nat'l Bank, 210 Ark. 124, 194 S.W. 2d 883 (1946), is misplaced.

In that case, we noted that where notice to a party to be affected and opportunity for him to be heard were not provided for in the law under which an assessment of taxes was made, the law was unconstitutional and void and the assessment was illegal. However, the statute at issue was held to be void insofar as it authorized an appeal by one property owner from the action of the Board of Equalization in refusing to raise the assessment of another property owner without requiring any kind of notice to the property owner whose assessment was being questioned.

As we noted in FNB’s first argument, FNB does not have a property interest that is recognized as being entitled to the degree of protection it claims. FNB’s rights are not directly affected; in fact, FNB is affected only to the extent that the Commissioner’s order allows regulated competition in a regulated industry. Consequently, the mandates of due process are not violated, and we hold the statute to be constitutional.

FINDINGS OF FACT

Finally, FNB argues that the findings of fact in the Commissioner’s order are in violation of the Administrative Procedure Act (Ark. Code Ann. § 25-15-210 (1987)) and not supported by substantial evidence. Here again, the Administrative Procedure Act does not apply to the extent that it is superceded by the branch banking provisions contained in section 23-32-1201 et seq.

Section 25-15-210(b)(2) provides in pertinent part that “[a] final decision shall include findings of fact and conclusions of law, separately stated. Findings of fact, if set forth in statutory language, shall be accompanied by a concise and explicit statement of the underlying facts supporting the findings . . . .”

Again, section 25-15-211 provides that the provisions of the subchapter concerning cases of adjudication in the Administrative Procedure Act do not apply unless “the grant. . . of a license is required to be preceded by notice and an opportunity for hearing.” Section 23-32-1203(e) specifically states that a formal hearing is discretionary in a branch bank application and would therefore preclude the application of section 25-15-210(b)(2).

Section 23-32-1203(f) of the branch banking subchapter provides that in the establishment of a full service branch office:

The commissioner’s decision on a branch bank application will be in the form of final findings of fact, conclusions of law, and an order given by the commissioner within a reasonable time period following the expiration of the fifteen (15) calendar day formal protest period.

Thus, the case law strictly interpreting section 25-15-210(b)(2) would only be applicable to those cases where notice and a hearing were both required. In contrast, given the informal nature of the branch bank application procedure, the Commissioner’s findings of fact are sufficient to satisfy the requirements of section 23-32-1203(f).

We note that the Commissioner incorporated the following facts and information in his order:

(1) Reliance on the written evidence submitted on behalf of both BNA and FNB, as well as an on-site investigation by state bank examiners.
(2) BNA is a banking corporation organized under a charter issued by the State of Arkansas with its principal place of business in Melbourne, Izard County, Arkansas.
(3) BNA provided evidence that suitable physical facilities would be provided for the full service branch.
(4) BNA maintained a good capital structure and a good financial condition. At the time of the Examiner’s Investigation for the proposed branch, BNA had 8.5% total capital to asset ratio.
(5) BNA maintained good future earnings prospects, good management, and was in conformity with Arkansas law and State Bank Department Rules and Regulations, according to the Examiner’s Investigation Report.
(6) Evidence provided in the branch application indicated that BNA maintained adequate fidelity coverage.
(7) The proposed service area for the proposed branch was in the towns of Calico Rock and Pineville and in the communities of Wideman and Dolph, Arkansas.
(8) Local conditions assured a reasonable promise of successful operation of the proposed full service branch. The Examiner’s Investigation Report provided evidence that there were four financial institutions in Izard County, but only two in the proposed trade area.
(9) Public convenience and necessity would be promoted by the establishment of the proposed branch. Evidence provided by BNA and cited in the Examiner’s Investigation Report indicated that BNA planned to offer all the products of a full service branch.
(10) The Examiner’s Investigation Report indicated that FNB was the only bank in Calico Rock and that it maintained a capital to asset ratio in the top 95 percentile of its peer group. The investigation also indicated that FNB had maintained an extraordinary earnings record, due in part to its below peer costs of funds. There was no indication that the establishment of SNA’s branch would have a significant adverse effect on competition or lead to destructive competition.

We find sufficient compliance with section 23-32-1203(f) and conclude that the Commissioner’s order was based on substantial evidence.

Affirmed.

Hickman, J., dissents.

Darrell Hickman,

Justice, dissenting. I would not reach the constitutional questions in this case. Instead, I would reverse due to the fundamental failure of the commissioner to enter any findings of fact sufficient to support his order.

When we have reviewed administrative decisions, we have required strict compliance with a statute that requires underlying findings of fact. See First Federal Savings & Loan Assoc. of Malvern v. Arkansas Savings & Loan Assoc. Bd., 257 Ark. 985, 521 S.W.2d 542 (1975); First State Bldg. & Loan Assoc. v. Arkansas Savings & Loan Bd., 257 Ark. 599, 518 S.W.2d 507 (1975). The requirement that the underlying facts be stated is primarily for the benefit of the reviewing court and the failure to comply with this requirement is not a minor and inconsequential matter. Arkansas Savings & Loan Assoc. Bd. v. Central Ark. Savings & Loan Assoc., 256 Ark. 846, 510 S.W.2d 872 (1974). The reason we must have sufficient findings of fact is to have an effective appellate review. If there are no facts, or insufficient findings of fact, we cannot say what the basis of the order is.

A comparison of some of the commissioner’s findings of fact with the statutory language shows that the commissioner has recited legal conclusions rather than explicit facts:

Statutory language: Public convenience and necessity will be promoted by the establishment of the proposed full service branch.
Findings of fact: Public convenience and necessity will be promoted by the establishment of the proposed branch. Evidence provided by applicant and cited in the Examiner’s Investigation indicate that applicant plans to offer all the products of a full service branch.
Statutory language: Local conditions ássure reasonable promise of successful operation of the proposed full service branch.
Findings of fact: Local conditions assure a reasonable promise of successful operation of the proposed full service branch. The Examiner’s Investigation for the proposed branch provides evidence that there are presently four financial institutions in Izard County but only two in the proposed trade area.
Statutory language: Suitable physical facilities will be provided for the full service branch.
Findings of fact: The Bank of North Arkansas has provided evidence that suitable physical facilities will be provided for the full service branch.

These are not “findings of fact” and are clearly inadequate to assist this court in reviewing the case. This involves an order allowing two banks to operate in a small community of eleven hundred people. Was it a political decision? We will never know. It certainly does not have a sound factual basis to justify it. The majority sets a bad precedent in approving such a baseless order.

The statute which provides no hearing will be necessary on a branch bank application, Ark. Code Ann. § 23-32-1203(e) (Supp. 1987), radically alters the power of the commissioner to decide the economic well-being of banks and communities. But it was surely not intended to result in unbridled, unchecked, and unaccountable use of power by one person.

The legislature, no doubt, intended for us to see that this power is not arbitrarily used. We have failed at the first opportunity.

I might point out that, while this law only allows branch banks to be established in the bank’s own county, that will soon be changed. After December 31,1993, a branch may be established in a county contiguous to the county where the bank’s principal office is located. After December 31,1998, the branches may be established anywhere in the state. Ark. Code Ann. § 23-32-1202(b)(3) and (4) (Supp. 1989).