A blog devoted to information and insight concerning appellate practice in Arkansas
Chief Justice Jim Hannah has been reappointed for a three-year term to the Judicial Conference Committee on Federal-State Jurisdiction. Justice Hannah, who is one of only four state supreme court justices serving on the committee, was first appointed to the committee in 2008. The full press release from the Arkansas Supreme Court is after the jump.
The Arkansas News Bureau reports that Niki Cung, a partner at Kutak Rock LLP, will run for the Arkansas Court of Appeals seat currently held by Judge Doug Martin, another Kutak Rock member. Judge Martin was appointed by Gov. Beebe to the seat previously held by Justice Courtney Henry upon her election to the Arkansas Supreme Court.
In 2008, Rule 54(b) of the Arkansas Rules of Civil Procedure was amended in an effort to resolve a finality problem that kept reoccurring. See Ark. R. Civ. P. 54(b), Addition to Reporter’s Notes, 2008 Amendments. The problem was that defendants (often “John Doe” defendants) would be added to a complaint, but then those defendants would never be served. See id. An order would be entered that would be considered by everyone to be final, and one party would then appeal. See id. However, because there were unserved defendants, the order would not be binding on those parties, and the Supreme Court or Court of Appeals would be forced to dismiss the appeal for lack of a final order. The purpose of Rule 54(b)(5) was to deal with this situation by providing that once a final order is entered, any claims against named but unserved defendants (including John Doe defendants) are dismissed. See Ark. R. Civ. P. 54(b)(5).
In Global Economic Resources, Inc. v. Swaminathan, 2011 Ark. App. 249, the Arkansas Court of Appeals introduced an interesting twist to the new rule. The case has a rather lengthy history, as is outlined below.
Trial Court
The case began as a breach of contract action by Global against Susindran Swaminathan and Venkataraman Melpakkam (referred to in the remainder of this blog post as the “Individuals”), doing business as Sabare SCM Solution, Inc. Id. at 1-2. After the answer was filed, Global filed an amended complaint dismissing the Individuals without prejudice, and adding Sabare SCM Solution, Inc., a Georgia corporation, as a separate defendant. Id. at 2. The trial court dismissed Sabare SCM with prejudice, holding that the court did not have personal jurisdiction. Id. Global appealed this order. Id.
First Appeal
Although the trial court had entered an order dismissing Sabara SCM, it had not entered an order in response to Global’s motion to dismiss the Individuals. Id. Therefore, the Court of Appeals dismissed the appeal for lack of a final order. Id.
Back to the Trial Court
After the dismissal of the first appeal, Global filed another amended complaint. Id. at 2-3. This complaint included as defendants the Individuals and Sabare SCM, and also added Ganesh Kumar and Sabare USA, Inc., as defendants. Id. On the same day, Global filed a motion to withdraw its earlier motion to dismiss the Individuals. Id. at 3. Sabare SCM and the Individuals again raised personal jurisdiction as a defense. Id. On March 11, 2010, the trial court entered an order dismissing Sabare SCM and Sabare USA for lack of personal jurisdiction. Id. In the same order, the trial court stated that it was granting Global’s earlier motion to dismiss the Individuals. Id.
After this order was entered, Global claimed to have served Sabare USA. Id. at 4. Sabare USA moved to quash, arguing that the court did not have personal jurisdiction. Id. In its response, Global asked that the motion to quash be denied, and also argued that the order dismissing the Individuals was improper because there was no motion to dismiss pending at the time (because Global had withdrawn its motion to dismiss). Id.
On September 30, 2010, the trial court entered an amended order reaffirming the conclusions in its March 11, 2010 order. Id. at 4-5. Six days later, on October 6, 2010, the trial court entered an “amended amended order,” correcting an error not relevant to the subject matter of this blog post. Id. at 5. On October 25, 2010, Global filed a notice of appeal.
The Second Appeal
On appeal, the Court of Appeals dismissed the appeal, holding that the notice of appeal was not timely filed. Id. at 5-7. The problem was that after the trial court dismissed the Individuals and Sabare SCM on March 11, 2010, only Sabare USA and Gamesh Kumar remained as parties. Id. Even though Sabare USA was served approximately two weeks after the March 11 order was entered, it had not been served prior to entry of that order (presumably Gamesh Kumar was never served). Id. at 4, 6. Therefore, these two parties were “named but unserved defendant[s]” pursuant to Rule 54(b)(5), meaning that any claims against them were dismissed at the time the claims against the served parties were dismissed. Id. at 6. As a result, the March 11, 2010 order was considered the final order for purposes of the notice of appeal, meaning that the October 25, 2010 notice of appeal was not timely filed. Id.
Conclusion
As mentioned above, the intent of Rule 54(b)(5) was to correct previous outcomes that “waste[d] litigants’ time and money and scarce judicial resources.” Ark. R. Civ. P. 54 Addition to Reporter’s Notes, 2008 Amendments. The rule was meant to resolve the problem created when “a forgotten defendant[s] . . . presence destroys the finality of the judgment being appealed.” Id. In this case, however, the unserved defendant actually created finality when none was intended, and the result was that the appeal was dismissed with the merits of the case never being addressed by the appellate court.
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Judge Richard Posner, of the U.S. Court of Appeals for the Seventh Circuit, created quite a stir lately with his law review article in the Yale Law Journal, in which he criticized the Blue Book’s citation format. Though his article criticizes many aspects of the Blue Book (its size, for example), he is particularly critical of its system of abbreviation:
An example that I have picked literally at random is “C.Ag.” What does “C.Ag.” stand for? Why, of course, the Código de Águas of Brazil. Now suppose one had occasion to cite the Código de Águas. Why would one want to abbreviate it? The abbreviation would be meaningless to someone who was not a Brazilian lawyer, and perhaps to Brazilian lawyers as well (but do they abbreviate Código de Águas “C.Ag”?). The basic rule of abbreviating, ignored by the authors of The Bluebook, is to avoid nonobvious abbreviations: don’t make the reader puzzle over an abbreviation, as The Bluebook does routinely. Consider “Temp. Envtl. L. & Tech. J.,” “ILSA J. Int’l & Comp. L.,” “Emp. Rts. & Emp. Pol’y J.,” and “AIPLA Q.J.” These are names of journals. Now try figuring out “B.T.A.M. (P-H),” “A. Ct. Crim. App.,” “A.F. Ct. Crim. App.,” “C.G. Ct. Crim. App.,” “N-M Ct. Crim. App.,” “Ne. Reg’l Parole Comm’n,” and “Cent. Ill. Pub. Serv. Co.” What is the point? It’s as if there were a heavy tax on letters, making it costly to write out Coast Guard Court of Criminal Appeals instead of abbreviating it “C.G. Ct. Crim. App.”
Judge Posner is so dissatisfied with The Bluebook that he has drafted his own citation manual, which is used by the clerks who assist him in drafting his opinions. The manual is approximately three pages long (or, in Judge Posner’s words, “one one-hundredth the length of The Bluebook”).
While Arkansas appellate attorneys might not want to rely on Judge Posner’s 3-page manual when drafting appellate briefs in Arkansas, there are resources available to Arkansas attorneys (in addition to the Blue Book) that can assist with proper citation in appellate court briefs. The website of the Arkansas Reporter of Decisions provides several of these resources:
For more information about how use the new citation format in Arkansas pursuant to Arkansas Supreme Court Rule 5-2(d)(2), check out our previous blog post on the topic, Using Arkansas’s New Citation Format.
If you want even more information about using citations in Arkansas trial court and appellate court briefs, the UALR William H. Bowen School of Law will be hosting a free CLE on Monday, March 7 at 11:30. The CLE, entitled Citation Insights: The Bluebook, the ALWD Citation Manual, and the Arkansas Supreme Court’s Citation Rules and Practices, will be presented by Professor Coleen Barger. Attorneys who attend can receive 1 hour of CLE credit. There is no charge for the CLE, but there is a $5 charge for lunch. If you plan to attend, please email Haley Walker at hewalker@ualr.edu.
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The Arkansas Times is reporting that Judge Ray Abramson, who is currently serving in an appointed position on the Arkansas Court of Appeals, will run for the Arkansas Supreme Court in 2012. He would be running for Arkansas Supreme Court Associate Justice Jim Gunter‘s seat. Justice Gunter has not announced whether he will seek re-election to that seat.
Case: Beverly Enterprises Inc. v. Keaton (Beverly II)
Appellate Practice Tip: Before appealing, make certain that all claims against all parties are either properly dismissed (meaning that a court order is entered) or adjudicated. Otherwise, the order from which you are appealing is a non-final order, and the Supreme Court will refuse to reach the merits of the appeal. See Ark. R. Civ. P. 54(b).
Case Explanation: The Arkansas Supreme Court’s recent decision in Beverly Enterprises Inc. v. Keaton (Beverly II) represents the second time that the same case has been dismissed without prejudice as a result of a Rule 54(b) problem. 2011 Ark. 7; see also Beverly Enterprises, Inc. v. Keaton, 2009 Ark. 431 (Beverly I).
The Plaintiff in Beverly filed suit both individually and in her capacity as administratrix of the estate. Beverly I, 2009 Ark. 431, at 1. In the original lawsuit, there were three defendants, all of which were business entities that were affiliated with Beverly Enterprises, Inc. (the “Beverly Defendants”). Beverly I, at 2. There were five claims alleged in the original complaint:
Id. at 2.
The plaintiff later amended her complaint to add a breach of fiduciary claim against the Beverly Defendants, and also added an additional Beverly entity and nine Beverly executives as defendants on that claim. Id. at 2. The amended complaint also added a claim for violation of the Uniform Fraudulent Transfer Act against all of the above defendants, as well as one other individual and five other entities. Id. at 2-3.
The claims and parties are somewhat complicated, so they are summarized in the table below. To add some level of clarity, the parties referred to in this blog post as the “Beverly Defendants” are indicated in orange.
| Source Document | Claim | Defendants |
| Original Complaint | Violation of Arkansas Medical Malpractice Act |
|
| Original Complaint | Violation of General Duty To Provide Adequate and Appropriate Custodial Care |
|
| Original Complaint | Violation of Arkansas Long Term Care Resident’s Rights Statute |
|
| Original Complaint | Deception by Representing Ability To Provide Proper Care |
|
| Original Complaint | Violation of Arkansas Deceptive Trade Practices Act |
|
| Amended Complaint | Breach-of-Fiduciary Claim |
|
| Amended Complaint | Violation of Uniform Fraudulent Transfer Act |
|
At a pretrial hearing, the plaintiff’s attorney acknowledged that no wrongful death claim had ever been alleged against any defendant, and also announced to the court that an agreement had been reached under which the plaintiff would nonsuit all claims against all defendants, except for the claims against the Beverly Defendants. Beverly I, 2009 Ark. 431, at 3. On the first day of trial, an order was entered dismissing with prejudice the plaintiff’s wrongful death claim.
After a jury trial, a judgment was entered against the Beverly Defendants on the negligence claims, and a punitive damages award was entered against two of those defendants. Id. at 3. A separate judgment was entered the same day declaring the Civil Justice Reform Act’s limitation on punitive damages unconstitutional. Id. at 3. However, no order was entered adjudicating the other claims or the other defendants. Id. at 3.
The Beverly Defendants appealed, but the Arkansas Supreme Court refused to reach the merits of the case. Id. The Court quoted Arkansas Rule of Civil Procedure 41(a), which provides that a dismissal without prejudice by a plaintiff “is a matter of right, it is effective only upon entry of a court order dismissing the action.” Id. at 4. Based on this, and based on Rule 54(b), the Court held that “a judgment is not final if it has not adjudicated all the claims against all the parties.” Beverly I, 2009 Ark. 431, at 4.
In Beverly I, only the negligence claims against the Beverly Defendants had been adjudicated. Id. at 5. The other claims and other parties had been neither properly adjudicated nor dismissed. Id. at 5. In essence, all of the claims and all of the parties in the chart above remained unadjudicated and not dismissed, except for the negligence claims against the Beverly Defendants. Therefore, the Supreme Court dismissed the appeal without prejudice.
Beverly II represented the second attempt to appeal the case. After the dismissal without prejudice in Beverly I, the trial court entered an order dismissing “with prejudice all of the Plaintiff’s claims against the Defendants save and except for the Beverly Defendants.” Beverly II, 2011 Ark. 7, at 1-2. It appears that this order properly dismissed all of the claims against the defendants who were added in the amended complaint (the defendants listed in the table above in black text). However, there were still claims remaining against the Beverly Defendants that still had not been adjudicated or dismissed. Id. at 2. Therefore, the Supreme Court held that the “remaining claims against Beverly must be properly adjudicated or dismissed before this court acquires jurisdiction to hear the appeal.” Id. at 2.
Arkansas appellate attorneys should be very careful about Rule 54(b) problems, as both the Arkansas Supreme Court and Arkansas Court of Appeals are very particular about compliance with the rule. Even where a plaintiff intends to waive certain claims, and even where it is clear from the transcript that the plaintiff intended to waive the claims, it is important to review the pleadings and orders to make certain that all claims against all parties have been adjudicated or dismissed.
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Today, the Arkansas Supreme Court adopted proposed changes to Arkansas Supreme Court and Court of Appeals Rule 5-3. The revisions had been proposed and published for comment on May 20 of this year. In re Ark. Sup. Ct. and Ct. of App. Rule 5-3, 2010 Ark. 252. Rule 5-3 relates to the issuance of a stay of a mandate (or the recall of a mandate) when a petition for writ of certiorari is filed at the United States Supreme Court. In re Ark. Sup. Ct. and Ct. of App. Rule 5-3, 2010 Ark. 408, at 1. The proposed changes address concerns regarding the duration of such stays. Id.
Though appellate lawyers in Arkansas should review the entire text of the rule, below are the primary changes and clarifications resulting from the revisions:
In its October 25 issue, Arkansas Business published an article detailing the amount of money spent on Supreme Court races in Arkansas. The articles provides a thorough analysis on the issue of money and judicial elections, both on the state level and from a national perspectives. Some statistics of note:
Click here for a link to the article.
UPDATE Below the Jump:
The Arkansas Supreme Court handed down its decision today in Forrester v. Daniels, clarifying that it has original jurisdiction over challenges to constitutional amendments that are initiated by the citizens, but appellate jurisdiction over challenges to constitutional amendments referred by the legislature. Forrester v. Daniels, 2010 Ark. 397. This has been the rule for many years, but had been called into question after amendment 80 to the Arkansas Constitution became effective on July 1, 2001. See Becker v. McCuen, 303 Ark. 482, 708 S.W.2d 71 (1990).
Because the Court did not reach the merits of the Petitioner’s case, this blog post will not discuss the merits in detail, but will only address them briefly. The proposed amendment at issue here deals with the maximum interest rate that can be charged by various entities, and also deals with the power of governmental units to issue bonds. Forrester, 2010 Ark. 397, at 2-4. The gist of the challenge is that the legislature attempted to cover too many issues in a single proposed amendment. Id. at 3-4.
The importance of this case, however, is more procedural in nature. Because, as discussed above, the status of the Supreme Court’s jurisdiction (original or appellate) was in doubt after the enactment of Amendment 80, the Petitioner filed nearly identical actions in the Pulaski County Circuit Court and the Arkansas Supreme Court, both on the same day.
A proposed constitutional amendment may appear on the ballot by one of two methods. The first is by referral from the legislature, the requirements of which are provided in at Arkansas Constitution Article 19, § 22. The second method is through the initiative and referendum power reserved to the people. This procedure is outlined at Arkansas Constitution Amendment 7.
Amendment 7, dealing with amendments resulting from initiatives of the people, provides that “[t]he sufficiency of all state-wide petitions shall be decided in the first instance by the Secretary of State, subject to review by the Supreme Court of the State, which shall have original and exclusive jurisdiction over all such causes.” Ark. Const. Amend. 7. Article Nineteen, Section 22 of the Arkansas Constitution has no such provision, so the Arkansas Supreme Court in Becker held that it did not have original jurisdiction, but had only appellate jurisdiction pursuant to Article 7, § 4 of the Arkansas Constitution. See Becker, 303 Ark at 482, 708 S.w. 2d at 71.
The reason this is an issue in Forrester is that Article 7 was repealed by Amendment 80 of the Constitution. Amendment 80 provides, in part, that “[t]he Supreme Court shall have . . . [o]riginal jurisdiction to determine sufficiency of state initiative and referendum petitions and proposed constitutional amendments.” Ark. Const. Amend. 80, § 2(D)(4). Because the provision conferring original jurisdiction on the Arkansas Supreme Court includes the phrase “and proposed constitutional amendments,” the Petitioner argued that the Arkansas Supreme Court now has original jurisdiction over all proposed constitutional amendments, and not just those resulting from initiatives. See Forrester, supra.
In a unanimous opinion, the Arkansas Supreme Court disagreed. The Court held in Forrester that the phrase “and proposed constitutional amendments” must be read in the context of the phrase “to determine sufficiency of.” Forrester, 2010 Ark. 397, at 8-9. According to the Court, that phrase only makes sense if “proposed constitutional amendments” refers only to amendments that result from initiatives from the people, as those are the only types of amendments subject to a sufficiency challenge. Id. For proposed amendments referred from the legislature, the only question is “whether the procedures governing the method for the legislature to propose an amendment have been followed.” Id.
In an interesting paragraph at the end of the opinion, the Court then seemed to look at its own rules to help it interpret the constitutional issue. The Court noted that it had amended its rules to conform to the changes resulting from Amendment 80. After the changes, Rule 6-5 read as follows:
(a) Original Jurisdiction. The Supreme Court shall have original jurisdiction in extraordinary actions as required by law, such as suits attacking the validity of statewide petitions filed under Amendment 7 of the Arkansas Constitution or, where the Supreme Court’s contempt powers are at issue.
Ark. Sup. Ct. R. 6-5(a) (2010).
In Forrester, the Court held its conclusion was “further bolstered” by the fact that it had amended the rules in response to Amendment 80, but had done so “in a way to indicate that our jurisdiction of the instant challenge is now original.” Id. at 9-10. Arkansas appellate lawyers should bear this in mind when dealing with procedural issues before the Arkansas Supreme Court, as the Court seems willing to look to its own rules to help it interpret constitutional provisions.
The election to fill the vacancy left by Arkansas Supreme Court Justice Imber’s retirement from the court late last year is less than three weeks away. The election, a runoff election between Arkansas Court of Appeals Judge Karen Baker and Pulaski County Circuit Court Judge Tim Fox, is being held because neither of the three candidates in the May 18 election received a majority of the votes. In the May election, Judge Karen Baker received 48% of the vote, Judge Tim Fox received 37% of the vote, and Evenlyn Moorehead received the remaining 15% of the vote.
This race is the only Appellate Court race that will be on the ballot in the general election on November 2, 2010. Because of this, the race has garnered quite a bit of attention from the media in the last few weeks. Below are links to stories that have been published about the race recently.
ArkansasAppeals.com will continue to post articles about the judicial race as they become available. Also, you can keep an eye on our blog and on our Twitter feed on election night for continuing updates on the election.
ArkansasAppeals.com 