The Arkansas
Lawyer A publication of the Arkansas Bar Association
Inside: ArkBar Lawyer Legislators Tort Reform Retirement Planning Same-Sex Marriage
Vol. 50, No. 1, February 2015 online at www.arkbar.com
Join us in Hot Springs for the ArkBar Annual Meeting
June 10-13, 2015
ArkBar
Annual Meeting Preserving Justice For All
June 10 -13, 2015
Register Now! ace.arkbar.com/AnnualMeeting
“Come for the celebration
leave with the
education.” #ArkBarAM
The 117th Annual Meeting Returns to Hot Springs The Arkansas Bar Association Annual Meeting is the largest legal event in Arkansas. Over four days, attorneys will come together for continuing legal education, receptions, award ceremonies, and entertainment. From traditional social events and receptions to cutting edge CLE, the ArkBar Annual Meeting is the place to be in June.
Justice Oliver Diaze, Jr. Former Mississippi Supreme Court Justice Friday, June 12, Keynote Speaker “Buying Justice: Corporate Spending on Judicial Elections in the Wake of Citizens United”
The 117th Annual Meeting will be held June 10-13, 2015. This year’s theme of Preserving Justice For All brings together a stellar lineup of local and out-of-state speakers.
2 The Arkansas Lawyer www.arkbar.com
Register now! Visit the official Annual Meeting site ace.arkbar.com/AnnualMeeting
PUBLISHER Arkansas Bar Association Phone: (501) 375-4606 Fax: (501) 375-4901 www.arkbar.com EDITOR Anna K. Hubbard EXECUTIVE DIRECTOR Karen K. Hutchins EDITORIAL BOARD Jim L. Julian, Chair Keith L. Chrestman Karen Sharp Halbert Judge Brandon J. Harrison Ashley Welch Hudson Anton Leo Janik, Jr. Philip E. Kaplan Tory Hodges Lewis Drake Mann Gordon S. Rather, Jr. David H. Williams OFFICERS President Brian H. Ratcliff Board of Governors Chair Anthony A. Hilliard President-Elect Eddie H. Walker, Jr. Immediate Past President Jim Simpson President-Elect Designee Denise Reid Hoggard Secretary F. Thomas Curry Treasurer Shaneen K. Sloan Parliamentarian Leon Jones, Jr. Young Lawyers Section Chair Jessica S. Yarbrough BOARD OF GOVERNORS Thomas M. Carpenter Suzanne G. Clark Don R. Elliot, Jr. Frances S. Fendler Amy Freedman Buck C. Gibson Amy L. Grimes Denise Reid Hoggard Don Hollingsworth Leslie J. Ligon Jeffrey Ellis McKinley Wade T. Naramore Laura E. Partlow Jerry D. Patterson Kristen L. Pawlik Brant Perkins John C. Riedel Gwendolyn Rucker Jerry L. “Jay” Shue, Jr. Brian A. Vandiver Danyelle J. Walker LIAISON MEMBERS Brian M. Clary Jack A. McNulty Judge Van A. Gearhart Rosalind M. Mouser Karen K. Hutchins Richard L. Ramsay Judge Mary S. McGowan Charles D. Roscopf The Arkansas Lawyer (USPS 546-040) is published quarterly by the Arkansas Bar Association. Periodicals postage paid at Little Rock, Arkansas. POSTMASTER: send address changes to The Arkansas Lawyer, 2224 Cottondale Lane, Little Rock, Arkansas 72202. Subscription price to non-members of the Arkansas Bar Association $35.00 per year. Any opinion expressed herein is that of the author, and not necessarily that of the Arkansas Bar Association or The Arkansas Lawyer. Contributions to The Arkansas Lawyer are welcome and should be sent to Anna Hubbard, Editor, ahubbard@arkbar.com. All inquiries regarding advertising should be sent to Editor, The Arkansas Lawyer, at the above address. Copyright 2015, Arkansas Bar Association. All rights reserved.
The Arkansas
Lawyer Vol. 50, No. 1
features
14 Meet the New Arkansas Supreme Court and Arkansas Court of Appeals Judges 16 ArkBar Lawyer Legislators 18 Act 649 of 2003, Act 1116 of 2013, Shelton, Methany, and a Special Task Force Later, Where are We on Allocation of Fault? By Brian G. Brooks 20 What’s New? Act 1116 of 2013 Creates Allocation of Fault Without Actual Contribution Benjamin McCorkle 24 Tort Reform in Wonderland By G. Spence Fricke and Scott M. Strauss 28 Retirement Planning for Lawyers: Why You Should Consider a Retirement Plan for Your Firm By Melanie J. Strigel and Tom Overbey 36 A Tale of Two Arguments: Same Sex Marriage in the Arkansas Courts and the Fayetteville Fairness Ordinance By Danielle Weatherby 42 Traps for Us Attorneys Not Blessed with a Steel-Trap Mind By John Keeling Baker
Contents Continued on Page 2
Lawyer The Arkansas Vol. 50, No. 1
in this issue ArkBar News
4
Board of Governors Report
10
2014-2015 Board of Governors
11
A Call to Leadership
12
2014 CLE Speakers and Planners
34
CLE Calendar
40
Disciplinary Actions
48
Arkansas Bar Foundation Memorials and Honorarium
54
In Memoriam
55
Classified Advertising
56
columns President’s Report
7
Brian H. Ratcliff
Young Lawyers Section Report
9
Jessica S. Yarbrough
The Arkansas
Lawyer A publication of the Arkansas Bar Association
Vol. 50, No. 1, February 2015 online at www.arkbar.com
For information on submitting articles for publication, go to http://tinyurl.com/ thearkansaslawyermag or email ahubbard@arkbar.com
Inside: ArkBar Lawyer Legislators Tort Reform Retirement Planning Same Sex Marriage
Arkansas Bar Association
2224 Cottondale Lane, Little Rock, Arkansas 72202
HOUSE OF DELEGATES Delegate District A-1: Jon B. Comstock, Andrew T. Curry, Angelia Esparza Muldoon, Kristin L. Pawlik, Vicki S. Vasser Delegate District A-2: Suzanne G. Clark, William Fitzgerald Clark, Casey D. Copeland, Bob Estes, M. Scott Hall, Jason M. Hatfield, Matthew L. Fryar, Leon Jones, Jr., Joshua D. McFadden, Sarah A. Sparkman Delegate District A-3: Aubrey L. Barr, Veronica Lawson Bryant, Colby T. Roe, Samuel M. Terry, Candice A. Settle Delegate District A-4: Open Delegate District A-5: Wade A. Williams Delegate District A-6: Jonathan E. Kelley Delegate District A-7: Samuel J. Pasthing Delegate District B: John T. Adams, Amber Wilson Bagley, Eric Scott Bell, Bart W. Calhoun, Frankianne E. Coulter, Grant M. Cox, Jason W. Earley, Edie Ervin, Caleb Peter Garcia, Kenya J. Gordon, Shana Woodard Graves, Stephanie M. Harris, James E. Hathaway III, Christopher Heil, Matthew R. House, Amy Dunn Johnson, Jamie Huffman Jones, Dominique King, William C. Mann III, Patrick W. McAlpine, J. Cliff McKinney, Chad W. Pekron, Shaneen K. Sloan, Jonathan Q. Warren, J. Adam Wells, David H. Williams, Thomas G. Williams, George R. Wise, Jr., Shana R. Woodard, Kim Dickerson Young Delegate District C-1: Roger U. Colbert Delegate District C-2: Michelle C. Huff Delegate District C-3: Keith L. Chrestman, Robert J. Gibson, Jason Milne Delegate District C-4: Jobi J. Teague Delegate District C-5: Matthew Coe, Sara Rogers, Albert J. Thomas III Delegate District C-6: Michael L. Murphy, Andrea G. Woods Delegate District C-7: Jimmy D. Taylor Delegate District C-8: Brent J. Eubanks, John P. Talbot, Jessica S. Yarbrough Delegate District C-9: Chase Adam Carmichael, Jenny Denise Chambers-Lemoine, Leslie J. Ligon Delegate District C-10: Clark D. Arnold, George M. Matteson Delegate District C-11: Sterling Tanner Chancey, J. Philip McCorkle Delegate District C-12: Kurt J. Meredith, Michelle M. Strause Delegate District C-13: John Andrew Ellis, Brian M. Clary Law Student Representatives: Tiffany Nicole Godwin, University of Arkansas School of Law; Nicholas Williams, UALR William H. Bowen School of Law
2
The Arkansas Lawyer
www.arkbar.com
Carpe tempus.
Announcing the Clio / Fastcase integration. Capture your legal research time in Fastcase —automatically in Clio. That’s smart.
Find out more at fastcase.com/clio Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
3
ArkBar NEWS
Denise Reid Hoggard Elected ArkBar President-Elect Designee Denise Reid Hoggard was elected the new Arkansas Bar Association President-Elect Designee following a ballot count in December 2014. Ms. Hoggard is an attorney with Rainwater, Holt & Sexton in Little Rock. Ms. Hoggard currently serves on the Board of Governors; as Chair of the Personnel Committee; Co-chair of the Women in the Profession Committee; and is a member of the Bar’s Long-Range Planning Committee, Law School Committee, and Leadership Academy Committee. She is a Bar Association Denise Reid Benefactor and a Sustaining Bar Foundation Fellow. She has Hoggard served as a member of the Judiciary Committee, Chair of the Labor and Employment Section, and as past President of the Arkansas Association of Women Lawyers for three terms. Ms. Hoggard will assume the office of President-Elect at the June 2015 Annual Meeting and President at the June 2016 Annual Meeting.
Arkansas Bar Foundation Welcomes New Staff Member
Lauren Phillips
The Arkansas Bar Foundation welcomes Lauren Phillips as the new Associate for Finance and Administration. Lauren and her family relocated to the Little Rock area from Maryland two years ago and lived overseas in Rota, Spain, before that time. Lauren earned her B.S. Degree in Transportation & Logistics and Marketing from the University of Maryland College Park and her MBA Degree in Management from Loyola University Maryland. She worked as a budget analyst for the United States Customs Service in Washington, D.C. and as the payroll/insurance lead for The Griffmore Group in Maryland. She most recently served as a part-time sales auditor
ArkBar Staff Anniversary A r k B a r ’ s Marketing and Information Specialist, Crystal Newton, recently celebrated her fiveyear anniversary. Crystal’s day-today responsibilities Crystal Newton include database management, website content, membership marketing and special events such as the Annual Meeting and Mock Trial. “Crystal has helped the Association integrate new technological and marketing strategies that have allowed the Association to keep up with our member’s expectations,” said Executive Director Karen K. Hutchins. “Her determination to make it right makes her invaluable to both Association volunteers and staff. Her assistance to the Mock Trial Committee’s recent restructure of the competition has allowed the event to expand and include even more Arkansas high school students.” Crystal and her husband have a threeyear old son, Bryson, and are expecting their second son, Easton, in March.
for Dillard’s, Inc. Lauren lives with her husband, Commander Joseph P. Phillips, United States Navy, and their three children: twins Aaron and Lynda, age 15, and Danny, age 11.
ArkBar Leaders at Arkansas Supreme Court Justices’ Investiture Pictured from left to right: President-Elect Eddie H. Walker, Jr., President-Elect Designee Denise Reid Hoggard, President Brian H. Ratcliff, and Immediate Past President Jim Simpson. The Arkansas Bar Association leaders attended the swearing-in ceremony at the Justice Building for the three Arkansas Supreme Court justices on January 6, 2015.
4
The Arkansas Lawyer
www.arkbar.com
SIGN UP FOR THE MINI REVIEWS Be one of the first to know about significant case decisions. Mini reviews are posted to the Case Summaries discussions in ACE. To join, login to ACE & go to the Communities tab, All Communities and Join Case Summaries.
ArkBar NEWS
Oyez! Oyez!
Deadline for submission of Annual Award Nominations due Friday, March 13, 2015
ACCOLADES Rosalind M. Mouser has become a member of the American College of Bankruptcy. The Jewish Federation of Arkansas honored Justice Annabelle Tuck as this year’s grand honoree for its annual Tikkun Olam awards. UALR School of Law Dean Michael Hunter Schwartz was named among the “2014 Most Influential People in Legal Education” by National Jurist Magazine.
APPOINTMENTS AND ELECTIONS The U.S. Senate confirmed the nomination of Colette Honorable to join the Federal Energy Regulatory Commission. Governor Asa Hutchinson appointed Leon Jones Jr. as director of the Arkansas Department of Labor and Lamar Davis and Elana Wills to the Arkansas Public Service Commission. Lori L. Burrows has been named as vice president and general counsel for Arkansas Electric Cooperative Corp. and Arkansas Electric Cooperatives Inc. Dan Young of Rose Law Firm has been elected a Fellow of the American College of Trust and Estate Counsel. Fred Ursery will serve a second three-year term on the Central Arkansas Library System board of trustees. Jeannie L. Denniston was appointed as Conway County District Judge. Darrin Williams has been appointed to the Little Rock Technology Park Authority Board.
WORD ABOUT TOWN Quattlebaum, Grooms & Tull PLLC recently announced that Brandon B. Cate has become a managing member of the law firm; Grant M. Cox, Michael B. Heister, Joseph W. Price II and Everett C. (Clarke) Tucker IV have been named members; and Ashley D. Phillips and Meredith Causey have joined as associates. Scott Hall has been elected as a shareholder of the Hall Estill law firm in Tulsa. Trae Gray, founder of LandownerFirm.com has moved into a law office overlooking Lake Carmack in Coal County, Oklahoma. Gill Ragon Owen, P.A. announced that Wm. David Duke became a shareholder and Jordan Wimpy recently joined the law firm as an associate. Richardson Richardson Boudreaux announced that Jason C. Messenger has been named a partner in the Tulsa based firm. Eichenbaum Liles, P.A. in Little Rock announced that Thomas B. Staley has joined the firm as of counsel. Wilson & Associates announced that Randy Bueter, Shellie Wallace and Aaron Squyres have been named shareholders in the law firm. Williams & Anderson announced that Dana Landrum joined the law firm. Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C. has elected three counsel to the firm’s membership, elevating the status of Courtney C. Crouch, III, Zachary T. Steadman, and Mary Catherine Way to members. We encourage you to submit information for publication in Oyez! Oyez! Please send to ahubbard@arkbar.com.
February 26-27 March 12-13 April 16-17
Upcoming ArkBar CLE
Natural Resources Institute Appellate Advocacy Debtor Creditor law Institute
It is time to nominate deserving candidates for this year’s Arkansas Bar Foundation and Arkansas Bar Association Annual Awards. The awards open for nomination are: • Outstanding Lawyer • Outstanding Lawyer-Citizen • C.E. Ransick Award of Excellence • James H. McKenzie Professionalism Award • Equal Justice Distinguished Service Award • Outstanding Jurist Award • Outstanding Local Bar Association These awards will be presented at the Annual Meeting in Hot Springs in June. You are encouraged to nominate Arkansas lawyers, judges and local bar associations who deserve recognition. Nomination forms may be submitted by any Association member. Forms are available at www.arkbar.com under the “What’s New” tab or by calling Ann Pyle at the Arkansas Bar Foundation at 501-375-4606.
Nominate a Colleague for the Lawyer Community Legacy Award Nominations Due February 28, 2015 Do you know an unsung hero or heroine? Submit nomination online at www.arkbar.com under the “Awards Nominations” tab in your member portal.
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
5
arcf lawyer ad 2013 Heather.pdf
1
9/17/13
10:15 AM
Arkansas Community Foundation can help you give clients good advice on smart giving. We offer tools to help Arkansans protect, grow and direct their charitable dollars as they learn more about community needs. You understand your clients’ charitable goals. We have the information and resources to make the philanthropic process simple, flexible and effective. We can help your clients establish endowments that provide a permanent source of funding for the causes they care about without setting up a separate private foundation.
C
M
Y
CM
MY
CY
CMY
K
When you partner with the Community Foundation, you stay in control of your client relationships, and we provide the tools and expertise to help you give your clients charitable giving options that match their needs. And your clients can receive the maximum tax benefits for their charitable gifts.
Talk about good! Contact President and CEO Heather Larkin today at hlarkin@arcf.org or 501-372-1116.
6
The Arkansas Lawyer
www.arkbar.com
Heather Larkin, JD, CPA President and CEO
PRESIDENT’S REPORT
A Three Course Meal—The Dessert By Brian H. Ratcliff Dessert is the sweet conclusion to a meal. Many times it is what we remember the most. The pièce de résistance can range in form and substance from a sorbet to cool and cleanse the palate to a dense decadent cake that leaves one stuffed for a week. I will confess that sometimes I get too carried away with my appetizer and entrée and do not have any room for dessert. Over Thanksgiving we had our nieces and nephew for a visit. As my nephew Beckett was chomping down on a hamburger, I warned him that he would not have room for dessert. Without missing a beat he said, it was “not a problem— I have two stomachs.” I like his approach to dessert. Dessert is the hardest thing for me to cook. I am just not a skilled baker. I do have several favorites that are tried and true such as Bananas Foster, Amaretto Crème Brule with chocolate swirls, bread pudding, and ganache soaked chocolate brownies. When dining out if there is a pastry chef listed on the web site or menu I will look hard at the dessert offerings before ordering so I can make sure to get my sweet tooth satisfied. Some of our favorite places for dessert have been Restaurant August in New Orleans and Charlie Trotter’s in Chicago. With that being said, I have several desserts to offer for a tasting. The first would be something to help cleanse your palate. Perhaps a deliciously light lemon soufflé. This would be the Annual Meeting June 10-13, 2015, in Hot Springs. As I have travelled and met other bar presidents, it is sweet to have them all asking
questions about the success and attendance at our annual meeting. They want to replicate what we do. As president an important appointment is the Annual Meeting Chair. It is hard to find someone to sacrifice the time it takes to do this right. My decision was easy. Paul Keith called me and volunteered! Paul has an excellent meeting planned. Our theme is “Preserving Justice for All.” We have Justice Oliver Diaz, Jr., whose story on the Mississippi Supreme Court inspired the John Grisham novel, “The Appeal.” Other programs include: Law, Justice, and the Holocaust: How the Courts failed in Germany by Dr. William Frederick Meinecke, Jr., and Humorist at Law, Sean Carter. While the Annual Meeting has wonderful CLE, it is more than that. This is an opportunity to meet new friends and catch up with old colleagues. For the most part lawyers all over our state are very civil to each other. I am of the opinion one reason is that each year we all gather and enjoy our company together and just have fun. If you have never been to an Annual Meeting please come and give it a taste. It is like your favorite dessert. All you have to do is think about it and many memories of food, family and love come flowing. The next offering for your menu is the big and decadent death by chocolate dessert. This would be the work done by the Task Force on License Suspension chaired by Past President Jim Simpson and the House of Delegates. After many meetings and rewritings, the Task Force
recommended amending Rules Governing Admission to the Bar, Rule VII. The Association supporting this amendment required approval by the House of Delegates so a special meeting was called. Several people warned me not to be disappointed if the required quorum, 51% of the voting members, was not met. On November 17, 2014, 48 voting delegates attended the special meeting, which made a quorum by two. Our Association staff gave a Herculean effort to obtain a quorum for the special meeting. The House passed a recommended version of Rule VII following discussions and revisions. On Tuesday, November 18, 2014, I filed with the Arkansas Supreme Court a Petition to Amend Rule VII. On Thursday, November 20, the Court entered a Per Curiam adopting a new Rule VII. The Per Curiam states: We thank the members of the Task Force and the Bar Association for their work. Because time is of the essence, we must act on the proposal without opportunity of comment. Accordingly, we accept the recommendation with minor revisions and adopt the amendment to Rule VII C as a provisional rule, effective immediately.” (emphasis added) 2014 Ark. 498 I strongly suggest you read the new rule. We learned that approximately 900 of our colleagues are delinquent in paying their annual license fee to the Supreme Court. The new rule
Brian H. Ratcliff is the president of the Arkansas Bar Association. He is partner with PPGMR Law, PLLC and manages the El Dorado office.
has teeth. If bar members are delinquent in paying the annual license fee, the delinquent attorney’s name will be published in a Per Curiam issued by the Court. I am proud of our Association as a whole. Our members sacrificed and worked on the revised rule and showed up for a speciallycalled meeting that many did not think could happen. This was a dessert where two parts work together to create a fabulous taste, i.e. chocolate cake and raspberry sauce. The final item on your dessert tasting menu is our current legislative session. I know there is nothing sweet about this! I failed to mention that there are savory desserts too. I love a good cheese tray with fruits for dessert. One of my favorites is blue cheese. I think the session can be akin to this. It does not look good, has an odor, but boy can it be good. At this time, the session is just getting moving. The Legislative Committee has had two formal meetings, and has not instructed our lobbyist, Jack McNulty, to support or oppose any bills. My next article will give you a detailed report on the session and our legislative package. Bon Appétite.
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
7
Subscribe Today! www.arkbar.com/ArkBarDocs
Over 200 Legal Documents Extensive Form List with new forms added periodically. Number of forms available listed next to category.
Acknowledgements
200+
7
Business Organizations
18
Civil Litigation, Federal & State
CUSTOMIZED TEMPLATES
Commercial Transactions
Creditors’ Remedies
13 28
Criminal Procedure
your paperwork,
3
12
Construction
reduce
16
Decedents Estates
25
mistakes, time,
6
Deeds
cost & stress
21
Domestic Relations Easements
1
Entity & Corporate Authority
22
Guardianships Leases Liens
3 16
Real Estate & Real Estate Finance 8
The Arkansas Lawyer
www.arkbar.com
1
21
only
$199/ yr
YLS REPORT
Living and Giving By Jessica S. Yarbrough
“You have not lived today until you have done something for someone who can never repay you.” — John Bunyan These long lasting words of the old English Christian writer and preacher should resound loudly within the hearts of those who appreciate the principles of service above self. While in Portland, Oregon, for the American Bar Association Young Lawyers Division Fall Conference, I seized an opportunity to serve as a volunteer for Project Street Youth. This program is the current national public service project of the Young Lawyers Division. According to the ABA, there are over 1.7 million homeless youth in the United States, and the population grows each year. Almost 40% of the homeless population is under 18 years of age. The unfortunate aspect of this study shows that Arkansas is included within this calculation. However, the saving grace is that Arkansans, young lawyers in particular, have the opportunity to make a positive impact in the lives of those that are less fortunate. Project Street Youth has three main components: Educating and Raising Awareness of the Issue. Young Lawyers are being armed with information and materials that
will help educate other lawyers and members of their community about the severity of the homeless youth problem in this country, as well as the laws and policies enacted to combat youth homelessness. Legislation. Young lawyers are encouraged to lobby for laws and policies to address the issue of youth poverty or homelessness, and provide those model laws and policies. Legal Clinic. Young lawyers are encouraged to partner with existing community organizations and set up legal clinics to help homeless youth or those who are in foster care with credit and consumer issues; public assistance and government benefits; and tickets, warrants, and minor criminal matters. While in Portland, my greatest reward was assisting a homeless youth who entered the legal clinic upon learning that young lawyers were present. Quickly dismissing his current situation and lack of resources, his eyes became bright as he inquired as to whether there was a patent attorney in the room. While I am not a patent attorney, other lawyers and I were able to point him in the right direction and he received a one-on-one session on what it takes to make his dream come true. The time taken for that young man who I will likely never see again was a seed sown
in helping to possibly change his life forever. Other youth had questions about credit issues, identity theft, and criminal matters. In Arkansas, there is an overwhelming population of children and youth who are in the custody of the Department of Human Services. According to the Arkansas Dream Center, there are many children who do not have proper after school supervision because of their parents’ or guardians’ work schedules. YLS looks forward to making a lasting difference in the lives of many by partnering with the Arkansas Dream Center to assist with after school mentoring, providing clothing, furniture, toys, and books for the less fortunate. YLS members should also consider becoming a member of Volunteers Organization for Central Arkansas Legal Services (VOCALS). The Center for
Jessica S. Yarbrough is the Chair of the Young Lawyers Section. She is an attorney with McKissic & Associates, P.L.L.C. in Pine Bluff.
Arkansas Legal Services helps people who suddenly find themselves vulnerable or helpless. According to Donna Ramsey, Pro Bono Coordinator in Pine Bluff, clients are interviewed and screened prior to the referral. Lawyers are also asked about their preference of cases and are able to accept them when convenient. There are countless avenues to get involved and make an impact in the lives of those who may never be able to repay their benefactors. Those interested should contact a member of the YLS, or make contact with a local civic organization. As John Bunyan would ask, “Have you lived today?”
Project Street Youth at the American Bar Association’s YLD Fall Conference in Portland, Oregon
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
9
Report from December 2014 Board of Governors Meeting
By Karen K. Hutchins
The Association’s Board of Governors met December 5-6, 2014, at the Arkansas Bar Center. Chair Anthony Hilliard began the meeting by welcoming the 2015 Leadership Academy class members. This was just one of the many opportunities that the class has to learn about and experience leadership in the legal community. President Brian Ratcliff reported to the Board that its appointment of the Administrative License Suspension Task Force led to a recommendation to petition the Supreme Court to amend Rule VII C of the Rules Governing Admission to the Bar. The Task Force’s recommendation was presented to and approved by the House of Delegates at a special session held on November 17 at the Arkansas Bar Center. The Association filed the petition to amend Rule VII C with the Supreme Court who quickly issued a Per Curiam adopting the rule changes. The Task Force’s work was completed, and the task force was disbanded by the Board upon recognition of the importance of their work. Chair Aaron Squyres presented the Governance Committee Report. The committee developed a privacy policy which the Board voted to recommend for adoption by the House of Delegates at their February 2015 meeting. The Board also approved the Governance Committee’s recommendation to adopt a Memorandum of Agreement clarifying the administration of the Arkansas Bar Association Political Action Committee. The Board congratulated Ms. Denise Hoggard in her recent election as the 2016-2017 President-Elect. In her current role as Personnel Committee Chair, Ms. Hoggard reported that the committee supported adoption of an Executive Director Succession Plan. The plan was approved at the meeting. Also recommended by the Personnel Committee was a By-Law amendment to Article V Executive Director. The purpose of the amendment was to clarify the role of the Executive Director in carrying out the business of the Association. Article V will be presented to the House at their February meeting along with Article XII Indemnification, which was previously recommended by the Board in August for consideration by the House in February. The Alternative Dispute Resolution (ADR) Section requested that the Board approve proposed amendments to their bylaws. The ADR Section bylaws were reviewed and approved by the Board. Additionally, the Board reviewed the Executive Committee’s recommendation to alter the Leadership Academy’s schedule to be held 10
The Arkansas Lawyer
www.arkbar.com
every other year to coincide with full legislative sessions. The Paralegal Committee report was presented by Chair Amy Johnson. That committee has developed Guidelines for the Utilization of Paralegals and asked that they be presented to the House. The Board voted to present the guidelines to the House for their consideration. Mr. Larry Burks, Chair of the Task Force on Professional Liability Insurance, presented their report. This Task Force has worked diligently to review our current professional liability insurance benefit. The Task Force recommended that the Association create a new comprehensive structure for its lawyer professional liability insurance program. The Board approved the Task Force’s recommendations and collectively thanked the members of the task force for their continued service to improve this important member benefit. With the legislature’s recent appointment of an Independent Citizens Commission to study the salaries of judges and legislators, the Board fully supported the creation of a task force which could participate in the conversations on judicial salary as invited. The Board encourages all members to mark their calendars to attend the 2015 Mid-Year meeting as it returns to Little Rock. All Arkansas attorneys are welcome to attend the Opening Reception at the Clinton Presidential Library on Wednesday, February 18. Other special Mid-Year events include the Supreme Court’s Oral Arguments in the Old Statehouse at 9:00 am on Thursday, February 19. This marks the first time the Supreme Court has heard oral arguments at the Old State House for over a century. Seating is limited for this event. Visit www.arkbar.com for more information on Mid-Year activities and to register.
KAREN K. HUTCHINS, J.D., CAE, is the Executive Director of the Arkansas Bar Association.
Arkansas Bar Association 2014-2015 Board of Governors
2014-2015 Officers President, Brian H. Ratcliff Board of Governors Chair, Anthony A. Hilliard President-Elect, Eddie H. Walker, Jr. Immediate Past President, Jim Simpson Secretary, F. Thomas Curry Treasurer, Shaneen K. Sloan Parliamentarian, Leon Jones, Jr. Young Lawyers Section Chair, Jessica S. Yarbrough President-Elect Designee, Denise Reid Hoggard Board of Governors: Thomas M. Carpenter, Suzanne G. Clark, Don R. Elliot, Jr., Frances S. Fendler, Amy Freedman, Buck C. Gibson, Amy L. Grimes, Denise Reid Hoggard, Don Hollingsworth, Leslie J. Ligon, Jeffrey Ellis McKinley, Wade T. Naramore, Laura E. Partlow, Jerry D. Patterson, Kristen L. Pawlik, Brant Perkins, John C. Riedel, Gwendolyn Rucker, Jerry L. “Jay” Shue, Jr., Brian A. Vandiver, Danyelle J. Walker Liason Members: Brian M. Clary, Judge Van A. Gearhart, Karen K. Hutchins, Rosalind M. Mouser, Judge Mary S. McGowan, Jack A. McNulty, Richard L. Ramsay, Charles D. Roscopf
This photo was taken at the Capital Hotel in Litttle Rock by KES Photos during the December 2014 Board of Governors meeting.
Front Row (l to r): Eddie H. Walker, Jr., Shaneen K. Sloan, Kristen L. Pawlik, Brian H. Ratcliff, Amy Freedman, Anthony A. Hilliard; Second Row: Jerry D. Patterson, Karen K. Hutchins, Judge Mary S. McGowan, Laura E. Partlow, Suzanne G. Clark, Denise Reid Hoggard, Leon Jones, Jr., Jeffrey Ellis McKinley, Amy L. Grimes; Third Row: Brian A. Vandiver, Brant Perkins, Don Hollingsworth, Wade T. Naramore, F. Thomas Curry; Fourth Row: Thomas M. Carpenter, Jack A. McNulty, Richard L. Ramsay, Buck C. Gibson
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
11
A CALL TO LEADERSHIP IN THE ARKANSAS BAR ASSOCIATION The petitions, current members of both bodies and district maps are listed on the Association’s website at www.arkbar.com. Board of Governors and House of Delegates links are located from the “Home” tab. The Young Lawyers link is located on the home page. Questions? Contact the Association at 501-375-4606.
Board of Governors Qualifications for Board of Governors The attorney must reside in the geographical area for the Governor’s position and must have served one year in the House of Delegates or must have been an Association member for seven years by the time of joining the Board of Governors in June. One Governor position is available in the districts listed. All are three-year terms.
Secretary & Treasurer 02-BG
Cleburne, Independence, Jackson, Jefferson, Lonoke, White, Woodruff
04-BG
Bradley, Calhoun, Columbia, Drew, Hempstead, Lafayette, Little River, Miller, Nevada, Ouachita
09-BG
Baxter, Boone, Carroll, Faulkner, Fulton, Izard, Lawrence, Madison, Marion, Newton, Randolph, Searcy, Sharp, Stone, Van Buren
11-BG
Clark, Conway, Crawford, Franklin, Howard, Johnson, Logan, Montgomery, Perry, Pike, Polk, Pope, Scott, Sevier, Yell
13-BG
Pulaski
14-BG
Pulaski
Election Process for Governors and Delegates For both governors & delegates, a nomination petition, signed by three current members of the Association who reside in the geographical area of election, must be filed with the Secretary at the Arkansas Bar Association, 2224 Cottondale Lane, Little Rock, AR 72202, no later than March 31, 2015.
House of Delegates Qualifications for House of Delegates The attorney must be an Association member residing within the delegate district as defined by Article XVI Section 2 of the Association’s Constitution. All are three-year terms. A-01
Benton 2 Delegates
C-05
Washington 4 Delegates*
Cleburne, Crittenden, Cross, St. Francis, White, Woodruff 1 Delegate
A-02
C-06
A-03
Crawford, Franklin, Johnson, Sebastian 2 Delegates
Faulkner, Van Buren 1 Delegate
C-08
A-04
Conway, Logan, Perry, Polk, Scott, Yell 1 Delegate**
Arkansas, Grant, Jefferson, Lincoln, Phillips, Lee 1 Delegate
A-06 B C-01
Pope 1 Delegate
Ashley, Bradley, Calhoun, Chicot, Cleveland, Columbia, Dallas, Desha, Drew, Ouachita, Union 1 Delegate
American Bar Association Delegate One of the two ABA Delegate positions is open for election for a two-year term. The Delegate from this Association to the House of Delegates of the American Bar Association shall be nominated by petition signed by at least 75 Association members with at least 25 voting members from each of the three state bar districts. The nominating petitions must be filed with the Secretary at the Arkansas Bar Association, 2224 Cottondale Lane, Little Rock, AR 72202, no later than March 31, 2015.
Young Lawyers Section Nominating Petitions are due March 31, 2015 for: Chair-Elect elected from District B (one-year term)
Pulaski 10 Delegates
C-10
Secretary/Treasurer elected
Clay, Greene, Lawrence, Randolph 1 Delegate
Miller 1 Delegate
C-11
Clark, Hempstead, Howard, Lafayette, Little River, Montgomery, Nevada, Pike, Sevier 1 Delegate
Representative District A
C-02
Independence, Jackson, Sharp 1 Delegate
C-03
Craighead 1 Delegate
C-04
Mississippi, Poinsett 1 Delegate
12
C-09
Article III, Section 7 of the Association’s Constitution provides for an annual election of the positions of a Secretary and a Treasurer. Any member interested in serving in either of these capacities should contact Karen K. Hutchins at 501-375-4606.
The Arkansas Lawyer
from any District (one-year term) (three-year term) Representative District B (three-year term)
* One of these seats is open due to vacancy and has a term ending in 2017. ** This seat is open due to vacancy and has a term ending in 2017. www.arkbar.com
Representative District C (three-year term)
FORENSIC PSYCHIATRY GERALD S. STEIN, M.D.
Cell: 479-244-6582 FAX: 970-987-5100 e-mail: jerrysteinmd@gmail.com See CV: www.geraldsteinmd.com Office Manager Rebecca Stein 479-244-5060
645 CR 235, Eureka Springs, AR 72632
DISCOVERY: DID YOU REALLY GET EVERYTHING? Do you know where your client’s or your opponent’s data is stored? How do you know you are providing or receiving all of the relevant documents in a production? Do you know the difference between a native document and an image? Ever heard of a load file?
WE’RE NOT JUST SOFTWARE. eZdiscovery is an Arkansas-based e-discovery provider with legal expertise and IT knowledge -- a formidable combination of skills. We know how to get the data you need to effectively and competently argue your case for the best outcome possible. And when you need software, we’ve got that, too.
LITTLE ROCK, AR | eZdiscovery.com | (888) 494-6182 Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
13
at the courts
Meet the New Arkansas Supreme Court and Arkansas Court of Appeals Judges Arkansas Supreme Court Three Supreme Court justices were sworn in on Tuesday, January 6, 2015, in the courtroom at the Justice Building. Justice Karen Baker was reelected to serve an eight-year term. Court of Appeals Judges Rhonda Wood and Robin Wynne were both elected to eightyear terms on the Supreme Court. The ceremony was historic, as Arkansas will have its first femalemajority court. The first woman to serve on the Supreme Court was Elsijane Trimble Roy, who was appointed to complete a term from 1975-1977. Justice Annabelle Imber Tuck was the first woman to be elected to the Supreme Court. She served from 1997 until her retirement in 2009. The new and reelected Court of Appeals judges were sworn in on January 30, 2015, at the Justice Building. Information courtesy of the Arkansas Judiciary website.
Judge Mike Kinard District 5 14
The Arkansas Lawyer
www.arkbar.com
Associate Justice Karen R. Baker Position 6
Associate Justice Rhonda K. Wood Position 7
Associate Justice Robin F. Wynne Position 2
Arkansas Court of Appeals
Judge Ray Abramson District 1, Position 1
Judge Kenneth Hixson District 3, Position 2
Judge Cliff Hoofman District 2, Position 2
Judge Larry Vaught District 6, Position 2
Judge Bart Virden District 2, Position 1
Judge Phillip Whiteaker District 1, Position 2
“I LOVE THAT WE’RE ALL A FAMILY AND IT FEELS LIKE HOME.” THE NEW SCHOOL IS A SPECIAL PLACE where students are given the freedom and opportunities to grow together in a supportive environment of learning and discovery. “I love that we’re all a family and it feels like home. Over the years you learn how to interact with each other more. I was really shy when I first came here, but ever since I got to elementary, I started opening up to everyone.” Teachers here strive to instill this confidence and match it with dynamic teaching so our students are prepared to tackle anything. NOW, POOJA LOVES A CHALLENGE. She’s a decorated figure skater, a talented violinist, loves algebra, can do 80 pushups and is ready to master piano. See what The New School experience can mean for your child. Schedule a tour today by calling 479-521-7037 or visit thenewschool.org.
NORTHWEST ARKANSAS’ PREMIER INDEPENDENT SCHOOL SERVING PRESCHOOL THROUGH GRADE 7 TheNewSchoolNWA
TheNewSchoolTweets
TheNewSchoolAR
Exhibit A: 150 combinEd yEArs of impEccAblE ExpEriEncE. (nEEd wE go on to Exhibit b?) Bell and Company has provided expert witness testimonies, economic damage assessment, business valuation and forensic accounting services to legal firms throughout the Southeast. Established by Richard Bell, a certified CVA, CFF, CPA and JD, Bell and Company has assisted in numerous court cases. Many attorneys find our sterling reputation and experience to be valuable assets. Call us, and let’s see what our 150 combined years of expertise can do for you.
bellandcompany.net / 501.753.9700
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
15
at the capitol
90th General Assembly
ArkBar Lawyer Legislators
A priority of the Arkansas Bar Association is to assist in the enactment of laws which comply with the Arkansas and U.S. Constitutions and improve the legal system in Arkansas. The Association
profession. You must first login to www.arkbar.com and then go to Legislative Resources under the For Attorneys tab on the home page. The recently updated website is the place
works full-time to monitor legislation issues affecting justice The Arkansas Bar Association has four members and the legal profession.
to find the status of bills of interest to the legal profession as well as more resources to keep you updated.
The Association is your advocate at the state Capitol. The Legislation Committee meets every Friday to review all bills that have been filed and keep you updated throughout the session. ArkBar’s Legislative Resources website is your source for current legislation issues affecting justice and the legal
Back the Pac! Become a supporting member of your non-partisan political action committee. Only $30 per year. Join today via your Member Portal on www.arkbar.com.
serving in the Senate and 10 members serving in the House of Representatives. Governor Asa Hutchinson and Attorney General Leslie Rutledge are also Association members.
16
The Arkansas Lawyer
www.arkbar.com
Governor Asa Hutchinson
Attorney General Leslie Rutledge
Representative Camille Bennett District 14
Representative Bob Ballinger District 97
Representative Mary Broadaway District 57
Senator David Burnett District 22
Representative Douglas House District 40
Senator Jeremy Hutchinson District 33
Senator David Johnson District 32
Senator Bruce Maloch District 12
Representative Matthew J. Shepherd District 6
Representative Clarke Tucker District 35
Representative John T. Vines District 25
Representative John W. Walker District 34
Representative David Whitaker District 85
Representative Marshall Wright District 49
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
17
Act 649 of 2003, Act 1116 of 2013, Shelton, Metheny, and a Special Task Force Later, Where are We on Allocation of Fault? The Winter 2014 edition of The Arkansas Lawyer contained articles discussing allocation of fault following the abrogation of
By Brian G. Brooks
joint and several liability in Act 649 of 2003.1 In true “Joe Friday” form,2 I wrote simply to describe the status of the law at that time.3 Continuing in the spirit of that venerable detective, I endeavor here to bring us up-todate on the topic.
Brian G. Brooks is a solo practitioner who focuses on appellate practice and complex legal research, writing and advocacy for the plaintiff’s bar.
18
The Arkansas Lawyer
www.arkbar.com
Act 649 abrogated the common law doctrine of joint and several liability and replaced it with separate proportional liability, called “several” liability by the Act. This abrogation created a right in each defendant sued to a judgment in which he or she is liable for no more than his or her proportional share of damages.4 The legislatively-created procedural device implementing Act 649’s change in the common law was declared unconstitutional by Johnson v. Rockwell Automation, Inc.,5 but Johnson did not replace that procedural device with something else. Defendants in cases where absent tortfeasors could be held responsible for some of the plaintiff’s injuries looked to a contribution action to accomplish a mathematical allocation of fault to every tortfeasor whether or not that tortfeasor was a party to the case from whom the plaintiff sought a money judgment at the time of the verdict.
But ProAssurance Indemnity Co., Inc. v. Metheny,6 and St. Vincent Infirmary Medical Center v. Shelton7 held that Act 649 contained no right to allocation and that a contribution action seeking only an allocation of fault was not cognizable due to the language of the contribution statute. So, the Legislature enacted Act 1116 of 2013, which alters the contribution statute in a clear effort to remedy the flaws identified by Metheny and Shelton: want of a “right” to allocation and lack of a cognizable cause of action for contribution solely to allocate fault. On August 2, 2013, the Arkansas Supreme Court appointed a task force to address concerns arising in the 2013 legislative session, including an effort to strip the Court of its exclusive rule-making authority.8 The Court noted that the debate arose even though no “recommendations” had been submitted to the Court for changes to rules of pleading, practice and procedure that were implicated in the debate, namely those “concerning ‘damages and/or liability in civil litigation.’”9 The Special Task Force was appointed to “insure thorough examination of the concerns” raised in the legislative debate.10 The Special Task Force issued its Interim Report at the end of December 2013.11 The topic addressed by the Task Force by way of proposed amendments to Rules 9, 49 and 52 of the Rules of Civil Procedure was allocation of fault and the interplay between Act 649 of 2003 and Act 1116 of 2013. The report was published, comments were sought and received on the proposed changes, and those comments resulted in changes to the proposed Rules by the Court’s Committee on Civil Practice.12 In August 2014, the Court adopted changes to Rules 9, 49, and 52, effective January 1, 2015, that put in place a procedure for allocating fault to absent alleged tortfeasors in civil cases.13 In essence, these Rule changes allow juries to assess “fault” against parties not sued by the plaintiff, or with whom the plaintiff has already settled before trial, when the procedures are followed and where the language applies. Lifting language directly from Act 1116 of 2013, the Rules allow assessment of fault against anyone “who may have joint liability or several liability” for the plaintiff’s injury even if that person or entity is not, and perhaps never was, a party to the
suit. The overarching question purposely left unanswered by the Rules’ drafters, a question highlighted in a dissent from the Court’s per curiam adopting the Rules, is how far the language “may have … liability” reaches. Two opinions from the Court also enter the mix. J-McDaniel Constr. Co. v. Dale E. Peters Plumbing Ltd.14 held that a traditional contribution action through which one tortfeasor actually seeks a contribution payment from another tortfeasor survived Act 649. English v. Robbins15 held, on the other hand, that Act 1116’s creation of a right to allocation of fault where no money judgment is sought from an absent tortfeasor was something new in the law that could not be applied retroactively. The Court did not comment on how the holding in English v. Robbins squared with its alterations to Rules 9, 49 and 52. Presumably, the Court made no such comment because those alterations were not in effect when the case was tried or when it was decided. The failure is unfortunate and somewhat short-sighted. The alterations to the Rules are in large part driven by the creation of a right to allocation of fault to nonparties by Act 1116. Indeed, the language of Act 1116 is placed directly into the Rules. Those Rules are to apply to cases before the courts from their effective date on, but English v. Robbins holds the right they are driven by is prospective only. Where and when does the right to allocation come into effect? The remand of English v. Robbins raises the issue quite pointedly and in a bizarre way. One reason English was reversed was because the right to allocation could not apply to it retroactively and allow allocation of fault to the settling tortfeasor. But now, on remand, the new Rules appear to require just that. So, can the defendants now allocate fault to that settling tortfeasor even though the case was reversed at least in part on that basis? That question is unanswered by the cases or the Rules. That is where we are with respect to allocation of fault in Arkansas. Rules are now in place, but their breadth and width are uncertain. A right to allocation exists, but it is prospective only, and its breadth and width is also uncertain. Let the cases on construction begin.
Endnotes: 1. 2003 Acts of Ark. No. 649 § 1(a). 2. “Joe Friday” is the fictional detective on the Dragnet series, initially a radio show and later a television program, created by Jack Webb. Detective Friday was fond of telling digressing and editorializing witnesses during interviews, “Just the facts, ma’am.” My intent in my writings on Act 1116 thus far has been the same. No editorializing. “Just the facts, ma’am.” 3. Brian G. Brooks, Legislative and Case Law Ties That Bind Act 649 of 2003 with Act 1116 of 2013, 49 The Arkansas Lawyer 38 (Winter 2014). 4. 2003 Acts of Ark. No. 649 § 1(b). 5. 2009 Ark. 241, 308 S.W.3d 135. 6. 2012 Ark. 461, 425 S.W.3d 689. 7. 2013 Ark. 38 425 S.W.3d 761. 8. In re Special Task Force on Practice and Procedure in Civil Cases, 2013 Ark. 303 (Aug. 2, 2013) (per curiam). 9. Id. at 2. 10. Id. 11. In re Special Task Force on Practice and Procedure in Civil Cases, 2014 Ark. 5 (Jan. 10, 2014) (per curiam). 12. In re Special Task Force on Practice and Procedure in Civil Cases—Ark. R. Civ. P. 9, 49, 52 and Ark. R. App. P—Civ. 8, 2014 Ark. 340 (Aug. 7, 2014). 13. Id. 14. 2014 Ark. 282, 436 S.W.3d 458. 15. 2014 Ark. 511.
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
19
What’s New? Act 116 of 2013 Creates Allocation of Fault Without Actual Contribution By Benjamin R. McCorkle1 Reacting to Johnson v. Rockwell Automation, Inc., ProAssurance Indemnity Co., Inc. v. Metheny and St. Vincent Infirmary Medical Center v. Shelton, the Arkansas General Assembly passed Act 1116 of 2013, amending the Uniform Contribution Among Tortfeasor’s Act (“UCATA”), codified as amended at Ark. Code Ann. § 16-61-201, et seq. (Supp. 2013). The General Assembly created a new right to allocation of fault to a nonparty at trial regardless of whether the trial party’s right to actual monetary contribution existed; the trial party simply could request that the jury allocate fault to a nonparty. The absence of the right to actual monetary contribution did not matter. Two cases made their way to the Arkansas Supreme Court. J. McDaniel Construction Company, Inc. v. Dale E. Peters Plumbing Ltd.2 is a “bad house” case involving the home buyer, the builder and the subcontractors. English v. Robbins3 is a medical malpractice case, where one defendant settled and the plaintiff proceeded to trial against the other defendants.4 Was Act 1116 Constitutional If Applied Retroactively? To determine whether an Act of the legislature can be applied retroactively, a court must determine, based on the facts of the case, whether retroactive application imposes a new right or whether it is purely remedial applying a previously existing right. The analysis becomes one of as-applied constitutionality. Benjamin McCorkle is cofounder of the Beacon Legal Group, a general service law firm emphasizing Internet law.
20
The Arkansas Lawyer
www.arkbar.com
1. If the right to contribution is present and being sought, then it is constitutional. J. McDaniel involved a dispute among defendants, the contractor and the subs concerning the contractor’s right to actual monetary contribution after the plaintiff settled. The Court found that Act 1116 was essentially procedural and remedial in nature where the right to actual monetary contribution was sought. Because contribution among tortfeasors for indemnity and money damages was a previously existing right, Act 1116 could be applied retroactively.
2. If the right to contribution does not exist and is not being sought, then application of Act 1116 retroactively is unconstitutional. In English, the defendants added a thirdparty defendant close to trial for the purpose of allocation of fault and did not seek actual monetary contribution. On appeal, the Court held that Act 1116 created a new right to allocation of fault where actual monetary contribution did not exist nor was being sought and that such a new right could not be applied retroactively without violating the Arkansas Constitution. Impact of Act 1116 on Plaintiffs 1. Defendants are able to place some nonparties on the jury ballot for the purpose of allocation of fault, without claims for actual monetary contribution (see below). Therefore, defense counsel will not be limited to telling the jury that some other unnamed nonparty or named party, not present at trial, is responsible for some or all of the fault. 2. Act 1116 is generally procedural and remedial in nature where the right to actual monetary contribution exists; however it also created a new right—allocation of fault where the right to actual monetary contribution does not exist and is not being sought. 3. If the defendant is claiming a right to actual contribution for indemnity or money damages from another party or former party to the lawsuit who may have settled, Act 1116 can be applied retroactively. For example, after the plaintiff settles, Act 1116 can be applied retroactively to permit the defendants to fight it out over allocation of fault for contribution purposes (J. McDaniel) where the right to contribution still exists (see below). 4. If the issue is just allocation of fault, then it cannot be applied retroactively. (English). 5. Adding a third-party defendant for allocation purposes can result in a role reversal for both defendant’s and plaintiff’s trial counsel: a. Defendant’s counsel must take on the role traditionally held by plaintiff’s counsel because the defendant has the burden of proving that the third-party defendant was negligent. b. Plaintiff’s counsel must defend the absent, third-party defendant to explain the relative negligence shared by all the defendants placed on the jury ballot.
Two additional takeaways from English are tangentially related to Act 1116. 1. Rule 14 allows a third-party complaint within 10 days of answering a complaint, or allows a third-party complaint with leave of the court after 10 days.5 However, the timing of adding a third-party defendant can be unduly prejudicial. The English Court found that the circuit judge did not abuse her discretion in concluding the plaintiff was unduly prejudiced by the defendant’s waiting over two years and then filing a third-party complaint close to the time of trial.6 2. Failing to instruct the jury that the defendant has the burden of proving the fault of the third-party defendant may be unduly prejudicial. At trial, the English trial judge instructed the jury that the plaintiff had the burden of proving the third-party defendant’s negligence and denied a proffered jury instruction based on AMI 206.7 Improperly instructing the jury on the burden of proof can provide sufficient prejudice to justify a new trial.8 Unanswered Questions McDaniel and English shed some light on post-Act 1116 third-party defendant actions, especially on the question of retroactive application. However, several questions remain unanswered. 1. Can a defendant who has been assigned some, but not all, of the fault by a jury take an additional offset based on the amount of the settlement paid by a third-party defendant? Section 5(c)(1) of Act 1116 states that defendant’s judgment is reduced by the amount of the settlement or the pro rata share of the settlement, whichever is greater. Assume Plaintiff sues D1 and D2. D1 settles for $100. The jury awards Plaintiff $300, attributing 50% of the fault each to D1 and D2. D2’s liability is $150. Plaintiff gets a total of $250. Plaintiff is short $50, but that’s life. However, under section 5(c)(1) D2’s judgment is reduced by $100 (settlement), and P only recovers $50 from D2, in spite of the jury’s award. If section 5(c)(1) is inter-
preted as allowing a reduction beyond that specified by the jury, this would effectively limit the amount of recovery by a plaintiff. Article V, Section 32 of the Arkansas Constitution provides that other than for workman’s compensation, “no law shall be enacted limiting the amount to be recovered for injuries resulting in death or for injuries to persons or property; . . . .”9 If this section is interpreted to allow an additional offset, its constitutionality is seriously in doubt. 2. When does the application of Act 1116 become retroactive? We know that attempting to apply Act 1116 after the jury has rendered a verdict is a retroactive application. However, suppose a case is filed before the effective date of Act 1116, and the defendant attempts to invoke the new right of allocation of fault prior to the commencement of trial.10 Is that an attempt to apply Act 1116 retroactively because Act 1116 was not in effect at the time the action was commenced? Some would argue that the right to file a third-party complaint with leave of the court existed at the time Act 1116 became effective. Therefore, no vested right would be impaired. However, other courts have refused to apply a new law to a tort committed before the law was enacted.11 3. Can a defendant add an immune nonparty as a third-party defendant for allocation of liability? For example, in a highway construction case, can the Arkansas Highway Department be placed on the verdict form for allocation of fault, even though they are immune as a governmental entity? Or, can a hospital that is immune from a damage award under charitable immunity be added as a thirdparty defendant under Act 1116? Or, can an employer who is immune under the Workers’ Compensation Act be third-partied in for allocation of fault? My best guess is no. Act 1116 applies only to “two (2) or more persons or entities who may have joint liability or several liability in tort for the same injury. . . .”12 If a potential party is immune from suit or damages, then that party could not be held liable. 4. Is Act 1116 facially unconstitutional
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
21
Appraising Real Estate throughout Arkansas for over 45 years. We are pleased to announce the opening of our office in Northwest Arkansas! J.T. Ferstl, JD, MAI Tom M. Ferstl, JD, MAI, SRA Little Rock
Fayetteville
501.375.1439 621 E. Capitol Ave. Little Rock, AR 72202 jtferstl@ferstlvs.com
C O M M ERCIAL
479.595.0245 101 W. Mountain St., Suite 210 A & B Fayetteville, AR 72701 websupport@ferstlvs.com
•
RES IDEN TIAL
•
EXPERT
T E S T I MO N Y
www.FerstlValuationServices.com as an impermissible intrusion into the Court’s exclusive power to make the rules of procedure? While the separation of powers issue was raised in English, the Court did not find it necessary to address the issue because the appellants attempted to apply Act 1116 retroactively. Act 1116 has both substantive and procedural aspects. The newly created right to allocation of fault without money damages is substantive and would not invade the Court’s exclusive power to promulgate the rules governing the procedure and practice of law.13 On the other hand, procedural aspects of Act 1116 identified by the Court in McDaniels could constitute an unconstitutional intrusion into the Court’s rulemaking powers. 5. Will a plaintiff ever settle with only one of several defendants? The rule of thumb has been, “Settle with all defendants or with none.” This informal rule is based on the tendency of juries to
22
The Arkansas Lawyer
www.arkbar.com
conclude that if a plaintiff settles with one defendant, then the plaintiff already has his or her money and does not need any more. Now, a piecemeal settlement is even less likely. Allocation of fault and the potential set-off issue noted above effectively preclude partial settlement in most cases. Conclusion Since the passage of the Civil Justice Reform Act of 2003, the practice of tort law in Arkansas has been in a state of upheaval and confusion. Act 1116 and the interpreting case law attempted to clarify some of the issues raised by the abolition of traditional, time-honored and tested common law joint and several liability. It will be rare to see contribution in the future. Contribution may arise where there is a settlement without allocation of fault (McDaniel); under Ark. Code Ann. § 16-55-203 where a court determines that one defendant’s share is not reasonably collectible and increases the per-
centages among the other defendants; under Ark. Code Ann. § 16-55-205 where defendants or their agents were acting in concert; or perhaps under a products liability claim. Plaintiffs should expect to see third-party defendants added just for allocation purposes under Act 1116. Now, a plaintiff who proceeds to trial against one defendant after settling with another takes on the huge risk of an unknown outcome, depending on how this new right of allocation of fault is applied to reduce the jury’s verdict. Rather than cutting down on the cost and expense of litigation, it has only increased it. Endnotes 1. The author was appellee co-counsel in English v. Robbins. This article will not attempt to recite the complete procedural and case history, as these have been adequately addressed elsewhere in this and previous issues of The Arkansas Lawyer. See e.g. The Arkansas Lawyer (Winter 2014). 2. 2014 Ark. 282, 436 S.W.3d 458. 3. 2014 Ark. 511. 4. The Arkansas Rules of Civil Procedure have been amended to facilitate the changes made by Act 1116 of 2013. 5. Ark. R. Civ. P. 14. 6. See English, 2014 Ark. 511, at *10. 7. See id. at *11-13. 8. See id. 9. Ark. Const. art. V, § 32. 10. This issue is before a circuit court at the time of this writing. 11. A statute abolishing the rule of no contribution among joint tortfeasors was held not to apply in the case of a tort committed before it was passed. See Massey v. Sullivan County, 464 S.W.2d 548 (Tenn. 1971). Cf. Phillips v. Agway, Inc., 389 N.Y.S.2d 977 (N.Y. App. Div. 1976). A Pennsylvania court denied retroactive application of a comparative negligence statute. See Costa v. Lair, 363 A.2d 1313 (Pa. Super. Ct. 1976). See generally 2 Sutherland Statutory Construction § 41:9 (7th ed. 2014). 12. Act 1116 of 2013, § 2(1). 13. Ark. Const. art. 4, § 2; Ark. Const. amend. 80, § 3.
Pulling together
for strength and efficiency. There’s immense power in working as a team, and we can bring unique technical expertise to your complex cases. Associate the The Law Office of David H. Williams and add experience and efficiency to your technical cases. Our areas of strength and knowledge include • Stryker hip replacement recalls • Dangerous drugs & recalls • Commercial vehicle accidents • Asbestos exposure • Auto product defects • Aviation Accidents • Negligence
Centre Place Building 212 Center Street Second Floor, Little Rock, AR 72201 (877) 492-3030 • (501) 372-0038 dhwilliamslawfirm.com
PRESERVE
Vol. 50 No .1/Winter 2015 The Arkansas THE JURY Lawyer TRIAL 23
Tort Reform in Wonderland
By G. Spence Fricke and Scott M. Strauss
“How puzzling all these changes are! I’m never sure what I’m going to be, from one minute to another.” — Lewis Carroll, Alice’s Adventures in Wonderland
G. Spence Fricke (pictured left) concentrates his practice in the areas of professional liability and personal injury defense litigation for the Barber Law Firm. Scott M. Strauss (pictured right) leads the Barber Law Firm’s Insurance Coverage Practice Group.
24
The Arkansas Lawyer
www.arkbar.com
The subject of tort reform and the issue of which branch of government is the greatest among equals has been the subject of debate and speculation since the Arkansas General Assembly enacted the Civil Justice Reform Act (Act 649 of 2003) and the Arkansas Supreme Court largely nullified it in Johnson v. Rockwell Automation, Inc.1 Following the Court’s decision in Johnson2 (striking the at-fault nonparty procedure), we were left with several, rather than joint and several liability, but with absolutely no way to assure that any one defendant or at-fault party paid only its share of liability. This vacuum was met with conflicting trial court decisions attempting to implement this new, substantive, right to pay only one’s share of fault.3 Following the Supreme Court’s decision in Johnson4 and the widely varying trial court decisions attempting to implement several liability, the Arkansas General Assembly again entered the fray, this time amending the Uniform Contribution Among Tortfeasor’s Act5 (“UCATA”) to set out precisely how a defendant might assure itself of a true “several” rather than “joint” share of the plaintiff’s damages. The act itself stated that it was “remedial in nature” and to apply “to all causes of action accruing on or after March 25th 2003,” the date on which the Civil Justice Reform Act6 went into effect.
The amendment to the Uniform Contribution Among Tortfeasors Act led to the inevitable challenges concerning the date of implementation of the Act’s language. In construing the timing issue, the Arkansas Supreme Court, in J-McDaniel Construction Company v. Dale E. Peters Plumbing Ltd.,7 stated:
procedural in nature, contrary to the assertions of appellees. See Steward, supra. Thus, as McDaniel argues, Act 1116 is retroactive and applicable to this case.9 So, as of June 2014, the law was settled, Act 1116 amending the Uniform Contribution Among Tortfeasors Act applied retroactively, consistent with its own language and the Supreme Court’s decision in J-McDaniel.10 It appeared that for the first time since tort reform was considered in 2003, the General Assembly and the Supreme Court reconciled and spoke with a single voice. But……………
However, as McDaniel argues, and as it asserted below in its motion for reconsideration subsequent to this court’s dismissal of the first appeal, the General Assembly has since passed Act 1116 of 2013, which clarified that a claim for contribution pursuant to the UCATA still exists after the 2003 enactment of the CJRA. [reversing its earlier Wonderland Revisited opinion in St. Vincent Infirmary Medical Center v. Shelton8] “Alice came to a fork in the road. ‘Which road do I take?’ ... she asked. The cardinal principle for construing reme‘Where do you want to go?’ responded the Cheshire Cat. dial legislation is for the courts to give appropriate regard to the spirit which promoted its ‘I don’t know,’ Alice answered. enactment, the mischief sought to be abol‘Then,’ said the Cat, ‘it doesn’t matter.’” ished, and the remedy proposed. Although —Lewis Carroll, Alice in Wonderland the distinction between remedial procedures and impairment of vested rights is often difficult to draw, it has become firmly established that there is no vested right in any particular mode of The doctrine of stare decisis provides: procedure or remedy. Statutes which do not create, enlarge, diminish, or destroy contractual or vested rights, but relate [I]t is the policy of courts to stand by precedent and not to disturb only to remedies or modes of procedure, are not within the settled point[s]. … [W]hen [a] court has once laid down a pringeneral rule against retrospective operation. In other words, ciple of law as applicable to a certain state of facts, it will adhere statutes effecting changes in civil procedure or remedy may to that principle….11 have valid retrospective application, and remedial legislation may, without violating constitutional guarantees, be conIn construing the doctrine of stare decisis the Arkansas Supreme strued to apply to suits on causes of action which arose prior Court stated: to the effective date of the statute. Id. at 353–54, 266 S.W.3d at 713 (internal citations omitted). Applying these principles to the present case, it is clear that Act 1116 was intended by the General Assembly to have retroactive effect. According to the stated purpose of the Act, which became effective on August 16, 2013: It is the intent of the General Assembly that the rights afforded to joint tortfeasors by this act apply with equal force after the modification of joint and several liability as provided in § 16-55-201 [Civil Justice Reform Act], and that none of the rights granted to joint tortfeasors by this act, including allocation of fault and credits for settlements entered into by other joint tortfeasors, shall be denied to joint tortfeasors. Act of Apr. 11, 2013, No. 1116, § 1, 2013 Ark. Acts 4345, 4346. Furthermore, the [amended Uniform Contribution] Act also states that, “This act is remedial in nature and applies to all causes of action accruing on or after March 25, 2003.” Id. § 8, 2013 Ark. Acts at 4348. Not only did the legislature expressly state that Act 1116 was to have remedial effect, the statutory provisions at issue in this case, which provide for a right to contribution, remain essentially unchanged from their prior versions. It is apparent that any changes that were made pursuant to Act 1116 were only
This court has consistently recognized that the doctrine of stare decisis is of fundamental importance, and that our prior decisions should not be overruled unless great injury or injustice would result. [internal citations omitted] ... As Justice Cardozo recognized many years ago, no judicial system could do society’s work if it eyed each issue afresh in every case that raised it. B. Cardozo, The Nature of the Judicial Process 149 (1921).12. Despite its decision holding that Act 1116 was to be applied retroactively (J-McDaniel) and despite its adherence to the doctrine of stare decisis, and just short of six months following its decision in J-McDaniel,13 the Arkansas Supreme Court revisited the issue of the retroactive impact of the amended Uniform Contribution Among Tortfeasors Act14 in its decision in English v. Robbins,15 reaching a vastly different result. Specifically, the Court stated: Appellants’ second argument is that the circuit court erred in denying their motion to set aside the order vacating the judgment following the General Assembly’s passage of Act 1116 of 2013. Appellants argue that this Act clarifies the law that a claim for contribution and allocation of fault is proper and should be applied retroactively to this case. We agree with the circuit court that the Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
25
Act cannot be applied retroactively to this case because it creates a new, substantive right of allocation of fault that the appellants sought to invoke in this case.16 To be fair, the Court attempted to reconcile its holdings in J-McDaniel17 and English18 when it stated: Our decision in J-McDaniel Construction Co. v. Dale E. Peters Plumbing, Ltd., 2014 Ark. 282, 436 S.W.3d 458, is not inapposite to this holding because the statutory provisions at issue in that case did not directly impact the newly created substantive right to allocation of fault. In that case, the plaintiff had brought suit against a construction company, which in turn filed third-party complaints against subcontractors. The plaintiff subsequently settled with all defendants. The circuit court dismissed the third-party complaints for contribution. On appeal, this court held that Act 1116 could be applied retroactively because “the statutory provisions at issue in this case, which provide for a right to contribution, remain essentially unchanged from their prior versions.” Id. at 12, 436 S.W.3d at 467. The markedly different procedural posture of the instant case mandates a different result. First, because the plaintiff had settled with the defendants in J-McDaniel, that case involved only the right of contribution for indemnity and money damages and not the right to receive an allocation of fault. While the provisions of Act 1116 regarding contribution for indemnity and money damages are similar to the previous version of the UCATA, the provisions of Act 1116 establishing a substantive right to an allocation of fault between joint tortfeasors are wholly new.19 A literal application of this language creates a very troubled legal outlook by encouraging plaintiffs not to settle with less than all defendants. Should a plaintiff settle with less than all defendants, he runs the risk of subsequent apportionment as to a defendant who will have no incentive to defend himself. A settled defendant might even be encouraged to “fall on his sword,” claiming all liability at trial secure in the knowledge it has no further exposure to the plaintiff by virtue of his release. Consequently, and in the absence of 26
The Arkansas Lawyer
www.arkbar.com
apportionment, plaintiffs will be forced to take all defendants to trial or settle with all defendants simultaneously. Given the public policy of encouraging settlement,20 one is left is left to wonder as to the purpose of this seemingly artificial distinction as between contribution and apportionment when both are designed to assure the right to several rather than joint and several liability. As the Arkansas Supreme Court has noted time and again, Arkansas’ public policy is determined by review of its constitution and its statutes.21 Following the adoption of the Civil Justice Reform Act,22 and in the absence of any showing of constitutional infirmity, the public policy of Arkansas clearly favors not only several liability but also a mechanism by which to enforce the right to several liability. Conclusion Those who practice tort law (and, indeed, any other area of practice) on a day-to-day basis know all too well that their comfort level in the decisions they make and the pleadings they file is founded on certainty and predictability. Knowing the state legislature and the Arkansas Supreme Court have consistently assured the practitioner that a particular defense, claim or pleading in general is the proper one for a given set of circumstances serves to greatly lessen one’s anxiety level in an already stressful profession. It also helps one advise his or her client on expected outcomes and overall strategies. It naturally follows that a host of legislative acts and inconsistent appellate decisions often have a severe negative impact on stability.23 Knowing, for example, the correct method to use to be sure your defendant/client is assessed only her proportionate share of any fault gives you a clear-eyed look at the approaching terrain. Not knowing, on the other hand, leads to confusion, uncertainty and inconsistent fitful efforts at addressing the situation by both courts and lawyers. An objective reading of J-McDaniel24 reveals no equivocation on the Court’s part on the retroactive effect of Act 1116. The decision was clear: There were no caveats in terms of its applicability. Act 1116 was to be applied retroactively. To then hold approximately six months later that it was not retroactive, at least as to an allocation of fault, leaves the practitioner in a state of complete uncertainty. What other portions of the Act are retroactive? What portions are not? Can one be assured a statute will be applied retroactively when
the legislature says its intent is for it to be retroactive? The editors of this publication asked us to comment on the implementation of Act 1116 in light of the J-McDaniel25 and English26 opinions. Our comment, frankly, is “we don’t know.” Like Alice, we are not sure of the direction in which we are going; unlike the Cheshire Cat, however, that matters a lot to us. Endnotes: 1. Johnson v. Rockwell Automation, Inc., 2009 Ark. 241, 308 S.W.3d 135. 2. Id. 3. See, e.g., Montgomery v. Chesterton Co.. Case No. CV2010-209, Crawford County Circuit Court; Reed v. Malone’s Mechanical, Inc., W.D. Ark., Ft. Smith Div., J. Dawson, Case No. 2:09-CV02061-RTD; Reed v. Malone’s Mechanical, Inc., W.D. Ark., Ft. Smith Div., J. Holmes, 2:11-cv-02135; Robinson v. Power Equip. Co., Case No. CV2010-108-6, Ouachita Circuit (Judge David Guthrie). 4. Johnson, 2009 Ark. 241. 5. Act 1116 of 2013. 6. Act 649 of 2003. 7. J-McDaniel Constr. Co. v. Dale E. Peters Plumbing Ltd., 2014 Ark. 282, 436 S.W.3d 458. 8. St. Vincent Infirmary Med. Ctr. v. Shelton, 2013 Ark. 38, 425 S.W.3d 761. 9. J-McDaniel, 2014 Ark. at 10-12, 436 S.W.3d at 465-467. 10. J-McDaniel, 2014 Ark. 282. 11. Black’s Law Dictionary 5th Ed., p. 1261. 12. Franklin v. Healthsource of Ark., 328 Ark. 163, 942 S.W.2d 837 (1997). 13. J-McDaniel, 2014 Ark. 282. 14. Act 1116 of 2013. 15. English v. Robbins, 2014 Ark. 511. 16. Id. at 6-7. 17. J-McDaniel, 2014 Ark. 282. 18. English, 2014 Ark. 511. 19. Id. at *8. 20. See, e.g., LaFont v. Mixon, 2010 Ark. 450, 374 Ark. 668 (2010); Ark. R. Civ. P. 68. 21. Tripcony v. Ark. Sch. for the Deaf, 2012 Ark. 188, 403 S.W.3d 559. 22. Act 649 of 2003. 23. Nowicki v. Pigue, 2013 Ark. 499, 430 S.W. 765; Davis v. Parham, 363 Ark. 352, 208 S.W.3d 162 (2005). 24. J-McDaniel, 2014 Ark. 282. 25. Id. 26. English, 2014 Ark. 511.
From the ordinary to the most complex, no appeal is too small or large Writing Briefs to the Arkansas Court of Appeals, the Arkansas Supreme Court, the Federal Circuits and the United States Supreme Court
TSCHIEMER
LEGAL BRIEFING Handling all your briefing needs Robert Tschiemer is the author of the Arkansas Bar Weekly Case Summaries, available at www.arkbar.com. For a complete list of decisions see www.tschiemerlegalbriefing.com
Robert S. Tschiemer
Ark. Bar 84148 P.O. Box 549 Mayflower, AR 72106-0549 501.951.3303 (p) 501. 377.9866 (f) robert@tschiemerlegalbriefing.com www.tschiemerlegalbriefing.com
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
27
Retirement Planning for Lawyers: Why You Should Consider a Retirement Plan for Your Firm By Melanie J. Strigel and Tom Overbey
Retirement plans are complicated and expensive, right? Why would I consider a 401(k) plan for my small firm? Aren’t retirement plans only for large law firms? Can’t I just contribute to an IRA or a SEP and avoid the hassle of a “real” plan?
Melanie Strigel (pictured left) is an attorney with Overbey, Strigel, Boyd & Westbrook, PLC where her practice focuses on retirement plans, employee benefits, and tax planning for both businesses and individuals. Tom Overbey (pictured right) is also with the firm and his practice focuses on tax planning. Tom is the State Chair for the American College of Trust and Estate Counsel. 28
The Arkansas Lawyer
www.arkbar.com
In our representation of attorneys and other service professionals, we have found that questions like these are common. In fact, the answer is that a tax-qualified retirement plan can provide substantial retirement benefits for attorneys and law firm employees at an affordable cost to the firm. This article will explain how a retirement plan can be a cost effective option for all attorneys, regardless of firm size. Contributions made to the plan are tax deductible to the law firm, thus reducing the firm’s current tax liability. While held in a retirement plan, earnings on the amounts contributed accumulate tax-free until withdrawn. In addition, funds in a retirement plan are protected from creditors both inside and outside of bankruptcy, unlike funds in a regular after-tax savings or investment account.
The effect of tax-free accumulation of earnings is significant and often overlooked. Deferring tax on investments provides at least two benefits. The first benefit is tax-free growth. Instead of paying tax currently on earnings, the investments can grow unhindered and tax is paid at a later date. The second benefit is that, with a retirement plan, the investment is typically made when the attorney is in fulltime practice and making a higher income (and is in a higher marginal income tax rate) than when the funds are withdrawn in retirement. The following chart illustrates the significant effect on savings of tax deferral. The chart shows the effect of annual $10,000 investments over a 30-year period, with an assumed growth rate of 8% and a 30% marginal federal and state income tax bracket. Investment in a tax-deferred account such as a qualified retirement plan would result in a balance of $1,223,459 ($946,421 after taxes are paid on the earnings) compared to $778,355 in a taxable savings or investment account. The chart also shows the projected variance after different periods of time. Although the most significant growth would occur if plan contributions begin at an earlier age, significant growth can occur over a shorter period if one should begin plan contributions at an age closer to retirement.
What Can I Contribute to a Retirement Plan? The current rules governing retirement plans provide generous contribution limits and flexible techniques to structure plan contributions to accomplish attorneys’ goals. A properly designed plan can provide attorneys the opportunity to save for retirement and also offer a valuable benefit to employees that can help with attracting and retaining qualified staff—all at a small cost to the firm. This article focuses upon the most generally applicable type of retirement plan for a small law firm—a “cash or deferred” or “401(k)” plan.1 This type of plan permits attorneys and employees to elect to contribute a portion of their pay to the plan on a pre-tax basis rather than receiving it as taxable compensation. Deferring compensation to the plan postpones state and federal income tax on the deferrals and also permits the deferrals to grow on a pre-tax basis in the plan. The law firm employer can also make contributions to the plan by “matching” the employees’ contributions and by contributing additional amounts as a discretionary contribution. A 401(k) plan can be established by a firm using any organizational form, whether a professional association (C Corporation or S Corporation), professional limited liability company or partnership, or general partnership. There are limits to the amounts of compensation that can be considered and the amounts that can be contributed to a 401(k) plan. We will provide more detail about these rules in the following section. But first let’s look at the savings opportunities that a plan can provide. Following are illustrations of possible retirement plan designs
that could be used for firms of various sizes and for attorneys of different ages. These illustrations show the benefits available for attorneys compared to the cost for contributions for staff. In all examples, the contributions satisfy all required contribution limits and discrimination testing and are deductible by the firm. Example 1: Law Firm A 2 attorneys (both partners,2 ages 46 and 37) 1 assistant (age 30) Law Firm A is a professional association with two partners.3 The older partner, age 46, would like to make the maximum permissible contributions to a plan, while the younger partner, age 37, would prefer to have higher take-home income due to family financial considerations. The firm employs one assistant, age 30. As shown below, a plan can be designed to achieve the attorneys’ objectives. Individual
Compensation
Employer Contribution (includes 3% Safe Harbor for Assistant)*
Employee Salary Reduction Contributions**
Total Contribution
Partner 1 (Age 46)
$220,000
$35,000
$18,000
$53,000
Partner 2 (Age 37)
$180,000
$0
$0
$0
Assistant (Age 30)
$30,000
$1,500
$0
$1,500
Totals:
$36,500
$18,000
$54,500
Total Cost for Nonpartners
$1,500
$0
* Safe Harbor 401(k) Plan using the 3% contribution safe harbor (for NHCEs only) and a cross-tested employer profit sharing contribution, as further described below. $53,000 is the maximum contribution limit in 2015. ** Salary reduction amounts are contributed by the employees as salary reduction contributions so they are not an expense to the firm. $18,000 is the legal salary reduction limit for a person under 50.
In this example, the partners each accomplish his or her objective. Partner 1 can have the maximum permissible contribution of $53,000 to the plan, Partner 2 does not have to contribute any amounts to the plan, and the firm cost is only $1,500 for their assistant, in addition to providing the assistant the opportunity to make salary reduction contributions to save for retirement. The partners can decide each year whether or not to contribute to the plan, so Partner 2 can begin contributing at any time and in amounts that are appropriate for his financial situation. The contribution for the assistant will be determined based upon discrimination testing. Example 2: Law Firm B 3 attorneys (2 partners ages 66 and 52, and 1 associate, age 35) 2 assistants (ages 58 and 42) Law Firm B has two partners who are at or nearing retirement age who would like to make maximum permissible contributions to a retirement plan ($59,000 for those over age 50 and $53,000 otherwise). The firm has an associate who would prefer not to reduce salary to contribute to a plan. Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
29
Individual
Compensation
Employer Contribution (includes 3% Safe Harbor)*
Employee Salary Reduction Contributions
Total Contribution
Partner 1 (Age 66)
$265,000
$35,000
$24,000
$59,000
Partner 2 (Age 52)
$265,000
$35,000
$24,000
$59,000
Associate (Age 35)
$160,000
$7,040
$0
$7,040
Assistant (Age 58)
$53,000
$2,332
$3,600
$5,932
Assistant (Age 42)
$37,000
$1,628
$2,200
$3,828
Totals:
$81,000
$53,800
$134,800
Total Cost for Nonpartners
$11,000
$0
* Safe Harbor 401(k) Plan using the 3% contribution safe harbor method and a cross-tested employer profit sharing contribution.
This example shows that Law Firm B’s two partners can each receive the maximum permitted total contribution of $59,000 for the year (combination of $118,000 for the partners), with a total firm contribution cost for the associate and two assistants of only $11,000. This means that approximately 88% of the total employer contribution cost for the plan will benefit the partners. If Law Firm B uses a productivitybased compensation method for the associate that charges the cost of the associate’s plan contribution against his or her pay, the total firm plan contribution cost would only be $3,960 for the two assistants. In addition, the plan offers the nonpartners the opportunity to reduce their pay on a pre-tax basis and contribute to their own retirement savings. In this example, both assistants have made salary reduction contributions. Example 3: Law Firm B (same census) If the partners in Law Firm B do not wish to make maximum contributions, they can still achieve significant retirement savings. The illustration below shows the contributions if the plan uses the 401(k) safe harbor contribution formula of 3% of compensation for all participants (discussed in the next section) but without any additional employer profit sharing contribution. Individual
Compensation
Employer Contribution (includes 3% Safe Harbor)*
Employee Salary Reduction Contributions
Total Contribution
Partner 1 (Age 66)
$265,000
$7,950
$24,000
$31,950
Partner 2 (Age 52)
$265,000
$7,950
$24,000
$31,950
Associate (Age 35)
$160,000
$4,800
$0
$4,800
Assistant (Age 58)
$53,000
$1,590
$3,600
$5,190
Assistant (Age 42)
$37,000
$1,110
$2,200
$3,310
Totals:
$23,400
$53,800
$77,200
Total Cost for Nonpartners
$7,500
$0
* Safe Harbor 401(k) Plan using the 3% contribution safe harbor method and no other employer contributions.
30
The Arkansas Lawyer
www.arkbar.com
In this example, the two partners can each make the maximum permitted salary reduction contribution of $24,000 for the year, and each will also receive a 3% employer contribution of $7,950, for a total contribution of $31,950 for each. The firm’s total staff contribution cost is only $7,500, or only $2,700 not counting the associate. Example 4: Law Firm B (with variation in salary deferral amounts) The 3% contribution safe harbor method is more efficient for Law Firm B than the matching safe harbor method (discussed in the next section) because the firm’s assistants participate in the salary deferral option. This is frequently not the case. Following is an illustration of the possible contributions for Law Firm B using the matching contribution safe harbor method, and assuming lower staff salary reduction contributions. Individual
Compensation
Employer Matching Contribution*
Employee Salary Reduction Contributions
Total Contribution
Partner 1 (Age 66)
$265,000
$10,600
$24,000
$34,600
Partner 2 (Age 52)
$265,000
$10,600
$24,000
$34,600
Associate (Age 35)
$160,000
$0
$0
$0
Assistant (Age 58)
$53,000
$2,120
$3,600
$5,720
Assistant (Age 42)
$37,000
$0
$0
$0
Totals:
$23,320
$51,600
$74,920
Total Cost for Nonpartners
$2,120
$0
* Safe Harbor 401(k) Plan using only a matching contribution of 100% of salary deferrals up to 4% of compensation.
In this example, the partners of Law Firm B again make maximum salary reduction contributions of $24,000 each, plus each receives a 4% matching safe harbor contribution of $10,600, for a total contribution of $34,600 for each. The only staff cost is a $2,120 matching contribution for Assistant 1. These illustrations of possible plan contributions show how a plan can be structured to best accomplish attorneys’ retirement objectives within the context of the firm’s situation. But, even though a retirement plan can offer a flexible means for an attorney to save for retirement with affordable costs for staff contributions, what about all the rules that apply to 401(k) plans and the cost involved to maintain and administer such a plan? Won’t these expenses offset the savings? What Rules Must the Firm Follow? It is true that many rules apply to qualified retirement plans. However, as shown above, these rules are flexible and permit law firms to customize a plan to suit the attorneys’ goals. The Internal Revenue Code sets annual limits on the amount that an individual can contribute to a 401(k) plan by way of salary reduction. For 2015, the maximum salary reduction contribution is $18,000. Individuals who are age 50 by the end of the year can con-
We’ve spent the past 50 years planning for retirement. When did you start planning?
Planning for retirement requires forethought, perception, and a little patience. That’s why the American Bar Association created the aba retirement funds program (“the Program”) – a comprehensive and affordable retirement plan built exclusively to address the unique needs of the legal community. Call an ABA Retirement Funds Program Regional Representative today! 866.812.1510 I www.abaretirement.com I joinus@abaretirement.com
The Program is available through the Arkansas Bar Association as a member benefit. This communication shall not constitute an offer to sell or the solicitation of an offer to buy, or a request of the recipient to indicate an interest in, and is not a recommendation of any security. Securities offered through Voya Financial Partners, LLC (Member SIPC). The ABA Retirement Funds Program and Voya Financial Partners, LLC, are separate, unaffiliated companies and are not responsible for one another’s products and services. CN0311-8585-0415
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
31
tribute an additional amount, up to $6,000, as a “catch up” salary reduction contribution, making their maximum salary reduction limit $24,000 for the year. The Code also limits the overall amount that can be contributed to a plan each year. The maximum permitted total 401(k) plan contribution for an individual (including salary reduction and all employer contributions, whether matching or profit sharing) is $53,000 in 2015, or 100% of compensation if less. This maximum is $59,000 for those over 50 because the $6,000 catch up salary reduction contribution is not counted in the annual limit. To be deductible to the firm, the total employer contribution to a plan for all participants (excluding salary reduction contributions) cannot exceed 25% of total compensation. Under the Code, the maximum amount of compensation that can be considered for an individual for retirement plan purposes is $265,000 in 2015. The examples demonstrate that these limits permit generous contributions. A 401(k) plan cannot discriminate in favor of highly-compensated employees (“HCEs”). For 2015, an HCE is an individual who is a 5% owner of the employer sponsoring the plan or who has earned more than $120,000 in 2014. In order to prove that it is not discriminatory, a 401(k) plan must pass special tests to check the level of salary reduction contributions and matching contributions for HCEs compared to nonhighly-compensated employees. If a regular 401(k) plan fails these tests, the employer must make an extra contribution to the plan or return some of the deferrals of HCEs. In some cases, the plan must also pass discrimination tests for the employer profit sharing contributions. This may sound complicated, but in practice there are a variety of techniques to use to automatically satisfy the discrimination requirements. One option is to adopt a “safe harbor” method of satisfying the 401(k) discrimination rules, such as illustrated above for Law Firms A and B. The benefit of a safe harbor 401(k) plan is that the employer does not need to perform the discrimination tests on an annual basis. Consequently, any HCEs, subject to certain limitations, may contribute the full 401(k) plan annual dollar amount without regard to the amount any nonhighly-compensated employee defers. There are two commonly used 401(k) safe harbor methods. The first requires an employer contribution of 3% of pay for all 32
The Arkansas Lawyer
www.arkbar.com
eligible employees. The second requires an employer matching contribution of 100% of a participant’s salary reduction contributions to the first 3% of pay and 50% of salary deferral contributions up to the next 2% of pay. The effect of this formula is that a participant must defer at least 4% of pay in order to receive the full contribution. Thus, for simplicity, many employers choose to offer a safe harbor matching contribution of 100% of a participant’s salary reduction contributions up to 4% of pay. The “cost” for using a safe harbor method is that safe harbor contributions of either type must be 100% vested immediately and they must be made even if the employee works less than 1,000 hours during the year or terminates employment during the year. Both types of safe harbor plans can also provide for additional matching contributions that are exempt from testing if they meet certain requirements. These additional matching contributions can require employees to work for a certain number of years in order to become vested in the contributions. A commonly-used vesting schedule permits employees to vest over a six-year period, so that the employee is 20% vested in his or her plan accounts after two years of employment and earns an additional 20% vesting after each successive year, becoming 100% vested after six years. If the employee terminates employment before becoming fully vested, he or she is only entitled to the vested percentage of the accounts. The nonvested portion will be forfeited, and the law firm can use the forfeited funds to pay plan administrative expenses, reduce the firm’s contribution to the plan, or contribute to other participants. A plan can provide for employer contributions in addition to safe harbor contributions. These additional contributions are frequently referred to as “profit sharing” contributions, but they are not contingent upon the firm’s profits. They can be subject to a vesting schedule (as described for matching contributions), and can be contingent upon the employee’s working more than 1,000 hours in the year and being employed on the last day of the year. There is great flexibility in structuring employer profit sharing contributions. If a firm wishes to provide maximum benefits for partners or other attorneys, one method is to use a type of contribution formula known as “cross-tested,” as illustrated above in Examples 1 and 2. Such a formula permits a firm to determine how the contri-
butions will be shared and can minimize staff costs. This type of plan will need to be tested each year to verify that the contribution satisfies discrimination tests; the testing depends upon the ages and compensation of the attorneys and staff in the firm. Other types of profit sharing contributions do not require annual discrimination testing. A retirement plan is considered “top heavy” if more than 60% of the accounts are held by certain key employees. If a plan is top heavy, the employer must make a special top heavy minimum contribution of at least 3% of each non-key-employee’s pay for those employees who are employed at the end of the year. Many law firm plans become top heavy. As another benefit of using a 401(k) safe harbor method, the 3% contribution safe harbor satisfies the top heavy requirement. Also, a plan that provides only safe harbor matching contributions is deemed to have satisfied the top heavy contribution requirement. To use a 401(k) safe harbor, the firm must give a written notice to employees before the first day of the plan year. This notice must describe the safe harbor method that will be used. For the 3% contribution safe harbor, the firm can give a “wait and see” safe harbor notice that states that the firm may make the safe harbor contribution for the year. If the firm decides to make the contribution, it must provide a supplemental notice at least 30 days before the end of the year stating that the safe harbor contribution will be made. This supplemental notice can be included in the safe harbor notice for the subsequent plan year. Thus, a 401(k) plan offers a firm flexibility in contributions. Contributions are not required if not advantageous in a particular year. Isn’t Retirement Plan Administration Complex and Expensive? Maintaining a tax-qualified retirement plan is not a complex process. With proper guidance, administrative expenses should be reasonable and are not a reason to avoid establishing a plan. The first requirements are to have a plan document, and then to follow the terms of that document. Plan documents are available in formats pre-approved by the IRS. These forms of documents must be revised for law changes once every five to six years. Regarding investment of contributions, the plan can either hold all contributions in a pooled trust account in which the trustees
determine investment, or permit participants to have segregated accounts in which they control their own investments. If certain Department of Labor rules are followed, the trustees are insulated from liability for losses that occur in a participant’s self-directed account. Trustees of the plan are subject to the fiduciary duty requirements of the Employee Retirement Security Act of 1976 (“ERISA”). ERISA contains a preemption rule and a general anti-alienation rule that protect qualified plan assets from the claims of participants’ creditors, including claims for state and federal taxes. Also, a participant’s interest in a tax-qualified plan is exempt from the participant’s bankruptcy estate. Participants must receive statements of their accounts, and an annual report, Form 5500, must be filed with the Department of Labor each year. The Form 5500 is filed online, and is a simple form that contains basic plan information. Many accountants handle these administrative requirements for their clients. Another option is to engage a third-party administration firm to handle the requirements. Does a 401(k) Plan Offer Advantages to a SEP-IRA? Many small firms have adopted a SEPIRA4 or a SIMPLE-IRA,5 which are not subject to ERISA and do not have these administrative requirements. Why would a firm consider a 401(k) plan when these plans, that can be set up easily with a bank, brokerage firm, or insurance company, are available? The answer is that, even with the added administrative cost of a 401(k) plan, a 401(k) plan can provide greater contributions toward retirement with a lower staff cost than a SEP or SIMPLE. There are other considerations as well. Under a SEP, the employer contributes to IRAs on behalf of employees. Employees cannot make salary reduction contributions. The contributions cannot be conditioned on the employee keeping the funds in the IRA and the SEP cannot prohibit withdrawals from the IRA. In contrast, the employer has discretion in structuring withdrawal provisions from a 401(k) plan. By law, salary reduction and safe harbor contributions cannot be withdrawn until age 59½. The employer could choose to prohibit all withdrawals while an employee is still employed, or to limit in-service withdrawals to hardship circumstances.
This preserves the aspect of the plan as providing a retirement benefit for employees. In addition, SEPs and SIMPLEs have required participation and contribution requirements. A 401(k) plan has flexibility in eligibility provisions. For example, part-time employees can be excluded. The contribution options described in the examples above are not possible in a SEP or a SIMPLE. Conclusion Attorneys, regardless of practice size, should investigate the options that a retirement plan may provide to save for retirement. Tax incentives for attorneys and the law firm, combined with creditor protection for assets and a reasonable cost to maintain a plan, make sponsoring a retirement plan an attractive option. A retirement plan offers an affordable benefit that can attract and retain qualified staff for a firm, in addition to offering valuable retirement benefits. Endnotes 1. Because the purpose of this article is to illustrate possible retirement plan options, we have omitted specific citations to the Internal Revenue Code and also omitted technical explanations of many of the techniques discussed in the article. The article outlines general principles only. Readers should discuss these options with their tax advisers, as results will vary depending upon an individual’s or firm’s specific situation. 2. The term “partner” refers to an owner in the firm, whether a shareholder of a professional association, member of a limited liability company, or partner in a partnership. Compensation for purposes of plan contributions is based upon W-2 compensation plus the amount of 401(k) deferrals and other nontaxable benefits such as cafeteria plan contributions, or upon net earnings shown on Schedule K-1, whichever is applicable for the attorney. 3. Individual partners in a partnership in many cases do not have the flexibility to determine the level of contributions to a plan as illustrated in this example. Other techniques can be used to accomplish the objective, however, such as having the partners individually incorporate. 4. “Simplified Employee Pension” under Internal Revenue Code Section 408(k). 5. “Savings Incentive Match Plan for Employees” under Internal Revenue Code 408(p).
Refer to Law Offices of Gary Green, P.A. We Share the Work We Pay the Costs We Pay 1/3 Associate Counsel Fees In Compliance With Rule 1.5(e) of the Arkansas Model Rules of Professional Conduct
Personal Injury Product Liability Medical Negligence Nursing Home Cases 1001 La Harpe Blvd., Little Rock, AR 72201 501-224-7400 1-888-4GARY GREEN (442-7947) www.gGreen.com ggreen@gGreen.com
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
33
Thank You 2014 ArkBar Volunteer CLE Speakers & Planners Allison Rene Allred Cheryl Fisher Anderson Richard Lance Angel D. Franklin Arey, III Amanda Armstrong Joyce Bradley Babin David Allen Bailey J. Grant Ballard Steve Barnes Melody Peacock Barnett Judge Ben T. Barry Steve Bauman J. Travis Baxter Mike Beebe Theresa Beiner Travis R. Berry Edwin R. Bethune, Jr. Seth T. Bickett Anthony W. Black Margaret Long Blissard Will Bond Lara Elizabeth Bowles Toney Baker Brasuell William C. Bridgforth Michelle L. Browning Larry W. Burks Charles Buttry Howard Gregory Campbell Jodi G. Carney Thomas M. Carpenter C. Jason Carter Joel B. Carter William A. Cash, Jr. Meredith McNeil Causey Jerry Winston Cavaneau Dr. Sarah Cearley Emmett B. (Chip) Chiles, IV Judge David Mayo Clark Roger U. Colbert Jon B. Comstock Ken Cook Dr. Don L. Cook Kevin A. Crass Junius Bracy Cross, Jr. C. Michael Daily Thomas A. Daily Lars Daniel Justice Paul Danielson Chris Davidson Madelyn Davis Lee Matthew Davis Steven B. Davis Mark A. Davis Erin Day Judge Beth M. Deere George Michael DeLoache Deborah S. Denton Natalie J. Dickson Holly Dickson Joel M. DiPippa Pamela B. Dixon Allen C. Dobson
34
The Arkansas Lawyer
J. Charles Dougherty Richard C. Downing Judge Xollie Duncan Jack East, III Wm. Conner Eldridge, Jr. Jennifer Leigh Elkins Edie Ervin Judge Audrey R. Evans Karen Ford G. Spence Fricke Matthew L. Fryar David M. Fuqua Kathleen A. Gallagher Fred Galves Martha A. Garrity David Allan Gates Timothy G. Gauger Jeffrey J. Gearhart David Gillespie, Jr. Chief Judge Robert J. Gladwin April R. Golden Chris Gomlicker James F. Goodhart Jack W. Gooding Justice Courtney Hudson Goodson David Allen Grace Julie D. Greathouse Chad M. Green Tracy Greenwood Tony Guerra Lorielle Blackwell Gutting Kenneth Ray Hall Lauren White Hamilton Frank S. Hamlin Chief Justice James R. Hannah Michael E. Harmon Judge Brandon J. Harrison Bilenda Harris-Ritter Keith Harvey Charles L. Harwell Melissa McMath Hatfield Curt Hawkins Mark R. Hayes Robb Helt Vincent C. Henderson, II J. Blake Hendrix Robert (Skip) L. Henry, III Judy Simmons Henry Daniel Lee Herrington Todd Hertzberg Judge Robert L. Herzfeld, Jr. Anthony A. Hilliard Denise Reid Hoggard James F. Hollander Cyril Hollingsworth Judge James Leon Holmes Jill Earnheart Holyfield Lori Holzwarth Leland Horton Christine Horwart Charles R. Hoskyn www.arkbar.com
Colonel Roy Douglas House Laura D. Hudson Karen J. Hughes R. Bruce Hurley Jeremy Y. Hutchinson Gail Inman-Campbell Gregory S. Ivester William Stuart Jackson Harry I. Johnson III Amy Dunn Johnson David Edward Johnson William M. Jones David L. Jones Jamie Huffman Jones Kendra Akin Jones Jerry C. Jones Robert S. Jones Phyllis M. Jones Colin R. Jorgensen Jim Julian Patti R. Julian Geoffrey Davis Kearney Tiffany Tackett Kell Matt Kemp Drew L. Kershen Charles M. Kester Shane E. Khoury Timothy C. Klinger Cynthia Worthing Kolb Joseph F. Kolb Brandon W. Lacy Michael J. Lamoureux Dana Maloch Landrum Michael V. Lauro, Jr. James Davies Lawson Louis Lem Kevin M. Lemley Joi Leonard Allyson Lewis Stark Ligon Kimberly Logue Judge J. W. Looney Richard A. Lusby Jim Malcolum Teresa Marks Judge D. Price Marshall, Jr. R. J. Martino Gayle C. Mason Michael E. McAlister Judge Bobby D. McCallister James Calman McCastlain Benjamin R. McCorkle Linda C. McCormack Linda Grim McCormick Lucinda McDaniel Dustin B. McDaniel Clint L. McGee Cliff McKinney II Jack A. McNulty Robert D. Meyers Matthew Bauer Miller Marie-Bernarde Miller
Judge Brian S. Miller John Milner Gary A. Monroe Judge James M. Moody, Jr. Harry Truman Moore Janet K. Moore Richard Vincent Morris Andy Mortensen Charles L. Moulton Rosalind M. Mouser Cynthia E. Nance Charles R. Nestrud Robert A. Newcomb Michael T. Newman Vickie Newton James E. Nickels Sherrill Nicolosi Ross A. Noland Gregory J. Northen Judge Cynthia A. Norton Edward T. Oglesby James E. O’Hern III Sach D. Oliver Stephanie Showalter Otts Ryan W. Owsley P. Delanna Padilla Justin Parkey Christian N. Parks Paul Parnell Annabelle L. Patterson Bryan Perry Jennifer R. Pierce Judge Mackie M. Pierce R. Keith Pike Pat Pine Harrison M. Pittman David M. Powell Paul A. Prater Philip R. Principe Mary J. Pruniski Kathryn A. Pryor Steven W. Quattlebaum John Rainwater Michael R. Rainwater Brian H. Ratcliff David R. Raupp Lynne T. Ravellette Warren Readnour Charles A. Redd Deborah Reheard W. Michael Reif George R. Rhoads Melissa Bristow Richardson J. Mark Robinette, Jr. John R. Rodman Jeff Rosenzweig Bianca M. Gatchell Rucker Rusty Rumley David J. Sachar Melissa Nicole Sawyer Steven F. Schroeder Amber R. Schubert
J. G. (Gerry) Schulze William D. Shapiro Matthew J. Shepherd Judge Bobby E. Shepherd Graham F. Sloan Judge Vann Smith Judge Lavenski Roy Smith George A. Snell O. C. “Rusty” Sparks Gary Speed Patrick L. Spivey Dawn Spragg Aaron L. Squyres Ross W. Stoddard III Edward C. Swaim Jeffrey Martin Swann Jennifer Taylor Judge Richard D. Taylor Judge Joanna Boyles Taylor Jason Michael Thomas Craig A. Thompson Christopher Robert Thyer Suzanne L. Tipton Geoffrey B. Treece Robert S. Tschiemer Judge Annabelle Imber Tuck John E. Tull III Lonnie C. Turner Cathy Underwood Fritzie M. Vammen Vicki S. Vasser Glenn Vasser Patricia H. Virnig Judge Joe Volpe Paul D. Waddell Jack Wagoner John W. Walker William C. Warren, Jr. John J. Watkins John Dewey Watson Dr. Jonathan Allen Weems Karen Whatley William W. Whatley, III David J. Whitaker Judge Phillip Whiteaker Brad J. Williams David H. Williams Jeff Wood Chad L. Wood Judge Rhonda K. Wood Victor D. “Trey” Wright, III Walter G. Wright, Jr. Jessica S. Yarbrough Tod David Yeslow Alan J. York Heather Zachary Steven S. Zega Dennis Zolper
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
35
A Tale of Two Arguments: Same-Sex Marriage in the Arkansas Courts and the Fayetteville Fairness Ordinance
By Danielle Weatherby In August 2013, I moved to Fayetteville to join the faculty at the University of Arkansas School of Law from New York, where I practiced labor, employment and education law for seven years. In the context of my law practice, I advised clients, and I now write, about laws governing the fair and equal treatment of LGBT individuals. So, naturally, I was intrigued to learn of several legal developments in Arkansas affecting the LGBT community. Not only was same-sex marriage litigation percolating its way through the Arkansas courts, but my new hometown was considering adopting a local ordinance that prohibited employers, businesses, and landlords from discriminating on the basis of gender identity, gender expression, and sexual orientation. For gay marriage, the issue brought added excitement and suspense when both the highest court in the state and a federal district court scheduled arguments on the same day concerning whether same-sex couples had the right to marry.
Danielle Weatherby is an assistant professor of law at the University of Arkansas School of Law.
36
The Arkansas Lawyer
www.arkbar.com
I. Morning Arguments at the Arkansas Supreme Court On a frosty morning in late November, I sat in the back of a hushed courtroom at the Arkansas Supreme Court among dozens of other legal enthusiasts. Many of them were the same-sex plaintiffs personally affected by the outcome of the day’s proceedings. As I pondered the fact that the Court was about to consider one of the great civil rights issues of our era, into the courtroom walked Jack Wagoner. The folksy, charismatic, and crisply dressed Little Rockbased lawyer leaned casually against the appellees’ table, his snow-white hair glistening against the backdrop of the crimson and leatherappointed round chamber. He waited to make his presentation to the seven justices who would decide his clients’ fate. The question of the day was whether the Court should uphold Circuit Judge Chris Piazza’s decision in Wright v. Smith,1 declaring the Arkansas ban on same-sex marriage (“Amendment 83”) unconstitutional.
A. Appellants’ Argument After the clerk called the case, counsel for the state approached the podium, clearly conscious of his duty to the public. “This is a case about change—about who decides, whether and when and how to effectuate change—seven justices of the Arkansas Supreme Court or over 700,000 voters of Arkansas,” Colin Jorgensen proclaimed. He urged the Court to defer to the voters on this issue. Justices Corbin and Danielson interjected with a flood of questions about the inherent tension between Amendment 83 and conflicting expressions of “due process” and “equal protection” in the Arkansas Constitution’s declaration of rights. Jorgensen argued that the voters’ adoption of the same-sex marriage ban, which came subsequent in time to the declaration of rights, amended the state constitution in a fundamental way and was now the state’s “supreme law.” He insisted that the voters are empowered to amend the Constitution by the Constitution itself, as expressly stated in Article 2 § 1.2 When Justice Goodson asked whether Amendment 83 violated the right to privacy, Jorgenson made a sharp distinction between laws like the statute at issue in Jegley v. Picado,3 which criminalized sodomy between same-sex couples, and Amendment 83. The former, he argued, granted the government an unconstitutional “invasion into the bedroom” and intruded upon inherently private behavior, while the latter simply preserves the status quo. Here, he explained, the plaintiffs ask not that the government cease from interfering in their private lives but instead that it act to publicly recognize their relationship. This response invited a flurry of questions from the panel, during which Jorgenson had to concede that his time had expired and promptly sit back down. Counsel for the city clerks took issue with the appellees’ reliance on Loving v. Virginia,4 claiming that bans on interracial marriage are distinguishable from bans on same-sex marriage. He claimed that the fundamental right to marry was originally founded in the common law of England, and interracial marriage, unlike same-sex marriage, had never been banned in England. He insisted that the plaintiffs were trying to “change the pool” of who’s eligible to marry—a “long-held, deeply rooted tradition.”
B. Appellees’ Argument When it was his turn, Wagoner made his way up to the podium, seemingly in a rush to rebut the state’s case. He dramatically unraveled a two-foot scroll of paper, a long list of the 50-plus decisions across the country declaring bans on samesex marriage unconstitutional. With the lengthy scroll held high in his left hand, he held up in his right a pint-sized, two-inch scrap of paper, the “short-list” of the three instances in which courts had upheld bans on same-sex marriage. The list included cases decided by courts in Louisiana and Puerto Rico, which Wagoner later jokingly referred to in the press room as “foreign countries.” The visual imagery was compelling and served as a legal testament that samesex marriage is spreading like wildfire across the country. This set the “everyone else is doing it, so we should too” tone for the morning’s arguments. Wagoner equated the Sixth Circuit’s recent 2-1 decision to uphold a ban on same-sex marriage to Arkansas Governor Orval Faubus’ infamous defiance of the Supreme Court’s unanimous decision dictating desegregation in the Little Rock School District. Wagoner implored the Court to “be on the right side of history.” Marriage equality is “happening whether we like it or not,” and none of the state’s justifications (procreation, preserving the institution of marriage) justify denying same-sex couples equal protection of the law. Justice Goodson asked how a favorable decision for the same-sex plaintiffs would affect challenges to statutes criminalizing bigamy and incest. But, Wagoner pointed to rational reasons (the bilateral nature of marriage and health concerns) to differentiate those circumstances. Justice Corbin asked whether Amendment 83 would be upheld if reviewed under rational basis scrutiny. Wagoner attempted to cite science that debunked the state’s assertion that traditional marriage is somehow better for children. When he was unable to locate the science in an amicus brief, Wagoner sheepishly confessed, “After 25 years of practice, I’m still nervous in front of you guys.” Justice Corbin chuckled and admitted, “We are just as nervous as you are on this side!” This playful banter between Wagoner and
Arkansas Supreme Court
the panel solidified the feeling in the courtroom—Wagoner was in his element. Finally, when asked whether the people can amend away federal constitutional rights, Wagoner posed a hypothetical. What if the people voted to amend the Constitution to require “everyone to join the Baptist Church?” Counsel admonished, “you just can’t amend away my constitutional rights.” Despite the growing body of federal precedent suggesting that Amendment 83 is unconstitutional, the arguments that morning took a surprising turn to the state law constitutional issues. The Court’s focus led me to believe that it could issue an unprecedented state law ruling that could hold a portion of the state constitution unamendable. If the Arkansas Supreme Court declared Amendment 83 unconstitutional on state constitutional grounds, the question would end there. Same-sex couples in Arkansas would be able to marry, and Arkansas would recognize same-sex marriages performed in other states. One argument down, one to go. II. Afternoon Arguments at the Eastern District of Arkansas Three hours later, I was driving across downtown Little Rock to the federal courthouse. Wagoner and Maples would now face Eastern District of Arkansas Judge Kristine Baker, in Jernigan v. Crane,5 a separate but substantially similar case, in which a different group of same-sex plaintiffs challenged Amendment 83 on federal constitutional grounds.
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
37
The federal courtroom, massive, formal, and imposing, was starkly different than the intimate chamber at the Arkansas Supreme Court. As I tried to find comfort in a rigid, wooden bench in the back of Judge Baker’s granite-lined courtroom, I recalled the morning’s lush and cozy seats. A few minutes later, Wagoner and Maples entered the courtroom, and all eyes were on them. The observers clapped their hands together in gratitude, sounds of acknowledgement and thanks for the morning’s successful performance. A. Plaintiffs’ Case With several pending motions on the docket, Judge Baker consolidated the issues and asked Wagoner to present the plaintiffs’ arguments. With the aid of a CLEstyle Powerpoint, littered with large block quotes, pristinely Bluebooked citations, and color graphics of same-sex couples, Wagoner nervously clicked through 88 slides. He walked the Court through a history lesson of the Supreme Court’s recognition of the right to marry. While I questioned whether Wagoner’s approach was appropriate for a federal judge, I wanted to believe that it was carefully calculated and well-thought-out. What followed was an hour and a quarter soliloquy, as Judge Baker listened patiently without interrupting. When Mr. Wagoner turned around to sit back down, there was an audible sigh of relief in the air. Then it was Ms. Maples’ turn to make her final plea. She spoke briefly and fervently to Judge Baker about her clients’ denial of equal protection. Maples reported that just yesterday, a man died, his husband now the first widow from the group of samesex couples married during the time before Judge Piazza’s decision was stayed. Because his status was in legal limbo, the surviving husband was not protected by state law and could not claim his husband’s body. Why should he be denied the fundamental right to have the same protections as heterosexual couples, simply because of his sexual orientation? “It’s time for these people to live their one life in happiness,” Maples concluded. B. Defendants’ Case Substantively, given the flood of federal decisions declaring bans on same-sex marriage unconstitutional, there is no question that the State had the uphill legal battle. Assistant Attorney General Nga Mahfouz’s 38
The Arkansas Lawyer
www.arkbar.com
argument primarily drew on two precedent cases. She argued that Windsor’s6 holding was narrow, standing only for the proposition that the federal government cannot impose its own definitions on the institution of marriage and that the question is left up to the states. Mahfouz first relied on the Supreme Court’s dismissal of the Minnesota Supreme Court’s decision in Baker v. Nelson, upholding a state law that limited marriage to persons of the opposite sex.7 Mahfouz argued that Baker bound the Court because it was a decision “on the merits” that is still controlling precedent. Mahfouz also cited the 2006 Eighth Circuit case, Citizens for Equal Protection v. Bruning, in which the Circuit upheld a Nebraska ban on samesex marriage.8 Arguing that Bruning was “completely dispositive of the issues here,” Mahfouz claimed that Bruning rejected the argument that same-sex marriage is a fundamental right. Wagoner forcefully countered that the Supreme Court summarily dismissed Baker without adjudication for “want of a substantial federal question.” There have since been important doctrinal developments that supersede Baker, including the decisions from the Second, Fourth, Seventh, Ninth and Tenth Circuits declaring similar bans on same-sex marriage unconstitutional. Wagoner cited Justice Ruth Bader Ginsburg’s remarks during the 2013 oral argument in Hollingsworth v. Perry: “The Supreme Court hadn’t even decided that gender-based classifications get any kind of heightened scrutiny. And the same-sex intimate conduct was considered criminal in many states in 1971, so I don’t think we can extract much in Baker v. Nelson.” Wagoner ended by distinguishing Bruning because the Bruning Court did not address whether there was a fundamental right for same-sex couples to marry. Upon completion of Wagoner’s arguments, Judge Baker reserved judgment. Then, the clock began to tick, and dozens of same-sex couples were waiting anxiously for a decision. III. The Take-Away Given the high stakes for the plaintiffs, as theatrically played out in court, Wagoner and Maples effectively captured the real-life impact of the issue. In contrast, attorneys for the state were relegated to procedural and impersonal institutional arguments.
Ultimately, Wagoner and Maples emerged from their day in court as Arkansas’ modernday legal heroes, champions of LGBT rights, who could both articulate the most sophisticated nuances of the constitutional legal arguments and, at the same time, joke with the seven justices of the Arkansas Supreme Court. IV. Civil Rights in Fayetteville Two-hundred miles northwest, the city of Fayetteville has been engaged in an equally important and divisive debate over whether to adopt a local ordinance prohibiting discrimination on the basis of gender identity, gender expression, and sexual orientation, among other categories. This past summer, the city council voted Chapter 119, affectionately dubbed the “Fayetteville Fairness Ordinance,” into the City Code during an all-night public meeting. Shortly thereafter, opponents of the ordinance gathered enough signatures for a referendum, and the question of whether to repeal Chapter 119 was put to a vote during a special election. On December 9, 2014, the residents of Fayetteville voted by a 4% and 500-vote margin to repeal Chapter 119. While at first glance the loss seems dismal, the voter turnout was one of the highest in recent history, with over 14,500 Fayetteville voters showing up at the polls. The city-wide debate over Chapter 119 sparked impressive community involvement on both sides of the issue, indicating that the people of Fayetteville are deeply engaged and care about their city. As Dr. Martin Luther King, Jr., so poignantly said, “human progress is neither automatic nor inevitable.” His point was that progress does not necessarily happen overnight. This is certainly not the end of the story for civil rights in Fayetteville. The effort to pass anti-discrimination protections for the LGBT community is simply gaining momentum, and I suspect the debate over fairness and equality in Fayetteville will continue into 2015. Conclusion It’s an exciting time for civil rights in the state of Arkansas. On November 25, 2014, in a 45-page decision, Judge Kristine Baker declared Amendment 83 unconstitutional, opining that same-sex marriage is a fundamental right that did not pass muster under strict scrutiny review. Judge Baker immediately stayed her decision pending appeal,
and the case is now being briefed in the Eighth Circuit Court of Appeals. As of the time I submitted this article, the Arkansas Supreme Court had yet to issue its decision in the state case. Since the oral arguments in November, Justice Donald Corbin has retired and newcomers Robin Wynne and Rhonda Wood joined the bench. In light of the change of personnel, with the weight of same-sex marriage still hanging in the balance, there remains uncertainty about which justices will cast votes on the issue and when a decision can be expected. Ultimately, the Arkansas Supreme Court’s silence may not matter in the long-run. The United States Supreme Court will decide the issue once and for all this term. On January 16th, the Court granted certiorari on four same-sex marriage cases in the Sixth Circuit, paving the way for a historic ruling by the middle of this year. As Wagoner said during oral arguments at the Arkansas Supreme Court, change may be “happening whether [we] like it or not.”
Gold Level Sponsors Friday, Eldredge & Clark LLP
With greatest appreciation to the sponsors of our 90th Year Scholarship Gala.
Keil & Goodson, P.A. Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C. / Ben J. Altheimer Charitable Foundation, Inc. Wright, Lindsey & Jennings LLP
Silver Level Sponsors
Bronze Level Sponsors
Kutak Rock LLP
Buddy and Susan Chadick
McDonald, McCann, Metcalf & Carwile LLP
Raffaelli & Prazak
Quattlebaum, Grooms & Tull PLLC
University of Arkansas Sam M. Walton College of Business
Rose Law Firm
Williams & Anderson PLC
Smith Hurst PLC Endnotes: 1. Wright v. Smith, 60CV-2013-2662, Decision by Judge Chris Piazza (3d Div. Ark. May 9, 2014). 2. “All political power is inherent in the people and government is instituted for their
protection, security and benefit; and they have the right to alter, reform or abolish the same, in such manner as they may think proper.” 3. 349 Ark. 600, 80 S.W.3d 332 (1977). 4. 300 U.S. 1 (1967).
5. Case No. 4:13-cv-410. 6. United States v. Windsor, 133 S. Ct. 2675 (2013). 7. 191 N.W.2d 185 (Minn. 1971). 8. 455 F.3d 859 (8th Cir. 2006).
Volunteers are an integral component of JLAP’s mission Volunteers are an integral component of JLAP’s mission to extend services throughout the state of Arkansas. Our volunteers provide peer mentoring— sharing their experience, strength, and hope with others. JLAP volunteers also serve as speakers who help educate the legal profession about addiction and mental health problems. The Arkansas Judges and Lawyers Assistance Program Committee and Foundation are grateful to our volunteers.
If you need someone to talk to, call or email us today (501) 907-2529 confidential@arjlap.org http://www.arjlap.org
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
39
ArkBar. 2
0
1
5
C
L
E
Feb. 26-27
Natural Resources Institute
March 5
How to Collect a Judgment
March 19
Witness Identification
March 12-13
Appellate Advocacy
March 20
Elder Law
March 27
Tort Law in Arkansas
April 2
Magna Carta
April 9 & 10
Office 365 Training
April 24
Construction Law
April 16-17
Debtor/Creditor Law Institute
April 30 -May 1
Labor & Employment Law
May 6
Intellectual Property
May 7
Electronically Stored Information
May 14-15
Environmental Law
www.arkbar.com Register online Purchase CLE Pass Preview Agendas
Over 19 in-person seminars throughout the state and over 100 one-hour webinars.
CLE Pass Package Pricing
40
The Arkansas Lawyer
www.arkbar.com
Credits, Convenience Lower Cost
RT PASSPO
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
41
Traps for Us Attorneys Not Blessed with a Steel-Trap Mind By John Keeling Baker
“It
is amazing the answers you will find if you simply read the rules. Go read them.”
Keeping up with the subtle and not so subtle differences in the Federal and Arkansas Rules of Civil Procedure is no cake walk and requires vigilant study.
For the civil practitioner with both a federal and state litigation practice, years of practicing in both courts brings not only the graying (or, in the author’s case, significant loss) of one’s hair but also a learned appreciation for unique differences found between certain of the Federal Rules of Civil Procedure (FRCP) and the Arkansas Rules of Civil Procedure (ARCP). Many of the differences between these rules are minor; others are quite serious. Highlighted below are some of the more significant differences found between the Federal Rules of Civil Procedure and the Arkansas Rules of Civil Procedure and the traps for the unsuspecting that spring from them. Though not exhaustive, the rules and traps listed below are intended as a refresher for the experienced attorney and to be shared with new attorneys who, hopefully, can avoid lessons learned the hard way. Of course, this list is no substitute for reading the rules. As a supervising attorney once told me, a new attorney fresh out of law school, “It is amazing the answers you will find if you simply read the rules. Go read them.” Though he certainly was right, a list like the one below may help hammer home the importance of his admonition—especially to a new attorney. 42
The Arkansas Lawyer
www.arkbar.com
John Keeling Baker, who serves on the Arkansas Supreme Court’s Committee on Civil Practice and is a partner with Mitchell Williams’ Little Rock office, has a litigation practice that focuses on contract disputes, business torts, and class actions.
Rule 5 - Filing of Responses to Requests for Admission Under FRCP 5(d)(1), an attorney is prohibited from filing written discovery requests and responses thereto until “they are used in the proceeding or the court orders [their] filing.” Ark. R. Civ. P. 5(c) is similar but different in one key respect: Requests for Admission and responses thereto must be filed in Arkansas state court actions, and the result of not doing so can be quite harsh.1 Rule 6 - Computing Time Under ARCP 6(a), when computing deadlines less than 14 days, intermediate Saturdays, Sundays, or legal holidays shall be excluded. Under FRCP 6(a)(1), when computing deadlines in days, intermediate Saturdays, Sundays, and legal holidays are included. Though “legal holidays” under the federal and state systems do not mirror one another (e.g., the birthday of an attorney employed with the state of Arkansas is a legal holiday under Ark. Code Ann. § 1-5-101(a) (11)), both sets of legal holidays are incorporated into each set of rules.2 Rule 7.1 - Corporate Disclosure Statement FRCP 7.1 mandates that nongovernmental corporate parties file a disclosure statement with their first filing or request addressed to the court. There is no such requirement in the Arkansas Rules of Civil Procedure. Rule 8 - Pleading Standard One of the most important differences between the Federal Rules of Civil Procedure and the Arkansas Rules of Civil Procedure is found in Rule 8(a). FRCP 8(a)(2) merely requires a pleading that states a claim for relief to “contain a short and plain statement of the claim showing that the pleader is entitled to relief.” In contrast, ARCP 8(a) requires such a pleading to “contain a statement . . . of facts showing . . . that the pleader is entitled to relief.” The former is commonly classified as “notice pleading,” while the latter is commonly classified as “fact pleading.” Not observing the more stringent fact pleading standard can lead to a bad outcome for the pleader in an Arkansas state court action.3
Rule 10 - Required Exhibits ARCP 10(d) states that “[a] copy of any written instrument or document upon which a claim or defense is based shall be attached as an exhibit to the pleading in which such claim or defense is averred unless good cause is shown for its absence in such pleading.” The word “shall” in Rule 10(d) indicates that compliance with the rule is mandatory and that not complying with ARCP 10(d)’s requirement may contribute to an undesirable outcome for the claimant.4 The Federal Rules of Civil Procedure do not mandate the attachment of any exhibit to a pleading. Rule 15 - Amending a Pleading Under ARCP 15(a), a party may amend his pleading at any time without leave of court. It is not so easy in federal court. Under FRCP 15(a)(1), a party may only freely amend his pleading within: (1) “21 days after serving it”; or (2) “if the pleading is one to which a responsive pleading is required, 21 days after service of a responsive pleading or 21 days after service of a motion under Rule 12(b), (e), or (f), whichever is earlier.” Otherwise, a party “may amend its pleading only with the opposing party’s written consent or the court’s leave.” Under ARCP 10(c), a state court litigant’s amended pleading may adopt by reference statements in a prior pleading. Such practice is specifically prohibited by Local Rule 5.5(e) of the Local Rules for the Eastern and Western Districts of Arkansas, a rule that also imposes additional filing requirements not found in ARCP. In short, amending a pleading in federal court is often much more cumbersome than amending a pleading in state court. Rule 26 - Initial Disclosures FRCP 26(a)(1)(A) mandates the service of initial disclosures in most civil cases. There is no such requirement in the Arkansas Rules of Civil Procedure.
Rule 26 - Discoverability of Documents in Possession of Retained Expert Witnesses Often, when a testifying expert is retained, there will be written communications between the expert and trial counsel, and it is not unusual for the expert to create various drafts of his or her written expert report. These sorts of documents are generally afforded protection from discoverability under FRCP 26(b)(4)(B) and (C). There are no similar protections specifically afforded under the Arkansas Rules of Civil Procedure. An attorney who has a “one size fits all” way of interacting and communicating with retained expert witnesses in both federal and state court actions does so at his or her own peril. Rules 30, 33, 34 - Commencement of Discovery Under FRCP 26(d)(1), civil litigants normally may not commence discovery until after their Rule 26(f) conference has occurred. There is no equivalent line in the sand under the Arkansas Rules of Civil Procedure. Generally, depositions may be taken in state court cases anytime after the expiration of 30 days after service of the summons and complaint upon any defendant.5 Interrogatories and requests for production of documents may be served upon a defendant at the same time the summons and complaint are served.6 Interrogatories and requests for production of documents may be served on a plaintiff after a complaint is filed.7 Rule 38 - Right to a Jury Trial Another of the most important differences between the Federal Rules of Civil Procedure and the Arkansas Rules of Civil Procedure is found in Rule 38. FRCP 38(b) requires a party to make any demand for a jury trial by serving and filing such a demand “no later than 14 days after the last pleading directed to the issue is served.” Typically, the “last pleading directed to such issue” is the answer.8 Woe to the attorney
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
43
who really wanted a jury trial but failed to realize the time crunch imposed upon him or her under the Federal Rules of Civil Procedure. Perhaps he or she can hope for the FRCP 39(b) discretion exercised by the Honorable Leon Holmes to empanel a jury even though counsel’s jury demand was made untimely and thus considered waived.9 In contrast, in Arkansas state court, the attorney who really wants a jury trial can file and serve his or her demand “not later than 20 days prior to the trial date.”10 Rule 41 - Voluntary Dismissal In Arkansas state court, a litigant generally has an absolute right to dismiss voluntarily his or her action “before the final submission of the case to the jury, or to the court where the trial is by the court.”11 No such right exists in federal court after the litigant’s opposing party has served either an answer or a motion for summary judgment.12 In federal court and subject to a few rules related to unique proceedings, after the litigant’s opposing party has served either an answer or a motion for summary judgment, the litigant can only voluntarily dismiss his or her action in one of two ways: (1) obtain a stipulation of dismissal signed by all parties who have appeared or (2) obtain a dismissal order (“on terms that the court considers proper”) from the court. Such court-imposed terms can provide for fee and cost recovery and limits on discovery in any re-filed action.13 Rule 45 - Notice of Subpoenas for Documents to be Served Upon Third Parties Subpoenas seeking only documents from third parties served in a stealth manner are not permitted under either set of rules. However, under ARCP 45(b), the serving attorney must serve such a subpoena “by e-mail, facsimile, or hand delivery on all other parties at least three business days before the subpoena is served on the person to whom it is directed.” Under FRCP 45, the serving attorney must merely serve each party with “a notice and a copy of the subpoena” “before it is served on the person to whom it is directed.”14 In short, one cannot move as fast in state court as in federal court when serving a third-party subpoena for records. 44
The Arkansas Lawyer
www.arkbar.com
Rule 64 - Addition and Withdrawal of Counsel Addition of counsel in a civil action is governed by Rule 64(a) of the Arkansas Rules of Civil Procedure. Neither the Federal Rules of Civil Procedure nor the Local Rules for the Eastern and Western Districts of Arkansas contains a rule that addresses the addition of an attorney of record. However, when a new attorney wishes to represent a party in a civil action in federal court, he or she is required to file a separate notice of appearance form and serve it on all parties.15 When working with suitcase-carrying outof-state attorneys, be aware that the substantive requirements for a motion for admission pro hac vice differ between federal court and Arkansas state court.16 A motion that fails to address each and every requirement for admission pro hac vice can contribute to a very bad outcome for a client.17 The Federal Rules of Civil Procedure contain no rule that addresses withdrawal of an attorney of record. Local Rule 83.5(f) of the Local Rules for the Eastern and Western Districts of Arkansas provides only that “[n]o attorney shall withdraw from an action or proceeding except by leave of Court after reasonable notice has been given to the client and opposing counsel.” An attorney’s withdrawal from a state court civil action can be trickier than in a federal court civil action. Rule 64(b) of the Arkansas Rules of Civil Procedure mandates a showing of good cause and a showing of three specific circumstances. Even if an attorney is granted permission to withdraw, his or her failure to fully comply with all aspects of Rule 64(b) can have troubling ramifications and result in protracted litigation.18 Rule 68 - Offers of Judgment The major distinction between these rules is found not in the text of the rules themselves, but the notes discussing and case law interpreting how they work. Together, they render ARCP 68 a decidedly more potent tool than FRCP 68. The first difference between FRCP 68 and ARCP 68 has to do with when the costshifting provision of the rules is triggered. The cost shifting provision in FRCP 68 has been interpreted to be triggered only in
cases “in which the plaintiff has obtained a judgment for an amount less favorable than the defendant’s offer.”19 In other words, if a federal court defendant successfully obtains a pre-trial dismissal of the action or even a defense verdict or bench trial ruling, it can make no application for costs based on a previously unaccepted offer of judgment it extended under FRCP 68. Arkansas case law has specifically rejected the limiting interpretation of Rule 68 announced in Delta Air Lines and permits an application for costs based on a judgment obtained by a prevailing defendant.20 The second difference between FRCP 68 and ARCP 68 has to do with the meaning of “costs” within the language of the rules. The case law interpreting FRCP 68 has generally held that the “costs” which are subject to the cost-shifting provisions of FRCP 68 are those found in 28 U.S.C. § 1920, unless the substantive law applicable to the particular cause of action expands the general § 1920 definition.21 Costs recoverable under 28 U.S.C. § 1920 are quite limited and include fees charged for the clerk, marshal, court reporter, printing, witnesses, copying, docketing, and court-appointed experts. These costs contribute to a small fraction of the hard costs typically incurred in modern civil litigation. The statute does not reach such things as travel expenses, long distance charges, imaging and duplication charges, AV trial expenses, and expert witness fees. According to the last sentence of ARCP 68 and its accompanying Reporter’s Notes, the Rule’s definition of recoverable “costs” was amended in 1988 and defined as “reasonable litigation expenses, excluding attorney’s fees.” The Notes state that this amended definition of costs “permits assessment of not only those costs authorized by statute, but also reasonable expenses typically incurred in the course of litigation. As a result, expenses disallowed under Darragh—e.g., meals and lodging—are now available under the amended rule. Attorney’s fees, however, are expressly excluded from the new definition.” No Arkansas case appears to have interpreted the outer limits of the broader definition of costs (“reasonable litigation expenses”) since the Rule’s 1988 amendment. Nonetheless, a litigant can feel confident that the “costs” recoverable under ARCP 68 are significantly
REDUCE THE COST OF YOUR STUDENT DEBT BY REFINANCING WITH SOFI Join other ArkBar members - ReFi with SoFi WHY REFINANCE WITH SOFI ?
SAVI NG S
F LE XIBILITY
SoFi borrowers save an average of $27,112 over the life of their loan.**
Multiple terms available. Variable rates as low as 2.66% APR and fixed rates as low as 3.625% APR (with AutoPay)*
CO N VENI ENC E
$ 3 0 0 BONUS
Consolidate all your student loans into a single loan. One lender. One bill. One monthly payment.
$300 welcome bonus for ArkBar members who refinance with SoFi through sofi.com/ArkBar***
“My borrowed funds come from real people, and there is no way I’m going to let my alumni down.” SoFi Borrower, David Bowman, Stanford ‘12
QUESTIONS? SOF I.COM/A RKBA R
Savings calculation is based on SoFi borrowers who refinanced between 5/21/14 and 7/2/14. Prior to refinancing, these borrowers had on average a $71,000 loan balance, a rate of 7.07% and a lifetime payment of $99,239, assuming a 10 year term. After refinancing, these borrowers have an average lifetime payment of $87,162 based on a weighted average of new rates received across both types (fixed and variable) and all terms (5,10,15 year) with AutoPay.* If approved for a loan, the fixed or variable interest rate offered will depend on the borrower’s credit history and will be within the ranges of rates listed above. For the SoFi variable rate product, the 1-month Libor index will adjust monthly and the loan payment will be re-amortized and changed monthly. APRs for variable rate loans may increase after origination if the LIBOR index increases. The SoFi 0.25% AutoPay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. ***Payment will be issued electronically once you become a SoFi borrower; you have submitted a completed application with documents and your loan has been disbursed. Offer good for new customers only. CFL license #6054612
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
45
more expansive than the “costs” recoverable under FRCP 68. Endnotes: 1. See, e.g., Duncan v. Olive, 2014 Ark. App. 152. 2. Fed. R. Civ. P. 6(a)(6)(C); Ark. R. Civ. P. 6(a). 3. See, e.g., Arkansas Department of Environmental Quality v. Brighton Corp., 352 Ark. 396, 403, 102 S.W.3d 458, 463 (2003). 4. See, e.g., Ray & Sons Masonry Contractors, Inc. v. U.S. Fid. & Guar. Co., 353 Ark. 201, 212-216, 114 S.W.3d 189, 196-198 (2003). 5. Ark. R. Civ. P. 30(a). 6. Ark. R. Civ. P. 33(b); Ark. R. Civ. P. 34(b)(2). 7. Ark. R. Civ. P. 33(a); Ark. R. Civ. P. 34(b)(1); Ark. R. Civ. P. 3(a). 8. Cross v. Phillips, 2006 WL 778607, *1 (W.D. Ark. Mar. 26, 2006). 9. Corbin v. Arkansas Best Corp., 2009 WL 707407, * 5 (E.D. Ark. Mar. 16, 2009). 10. Ark. R. Civ. P. 38(a). 11. Ark. R. Civ. P. 41(a)(1).
46
The Arkansas Lawyer
www.arkbar.com
12. Fed. R. Civ. P. 41(a)(1)(A). 13. See, e.g., Weaver v. Toyota Motor Corporation, 2014 WL 907715 (E.D. Ark. 2014). 14. Fed. R. Civ. P. 45(a)(1)(D)(4). 15. Section III.A.2.a. of the CM/ECF Administrative Policies and Procedures Manual for Civil Filings (Rev. 3/13/14). 16. Compare Rule 83.5(d) of the Local Rules for the Eastern and Western Districts of Arkansas and Rule XIV of the Arkansas Rules Governing Admission to the Bar. 17. See, e.g., Preston v. Univ. of Arkansas for Med. Sciences, 354 Ark. 666, 128 S.W.3d 430 (2003). 18. See, e.g., Jones-Blair Co. v. Hammett, 326 Ark. 74, 930 S.W.2d 335 (1996). 19. Delta Air Lines, Inc. v. August, 450 U.S. 346 (1981). 20. Darragh Poultry & Livestock Equip. Co. v. Piney Creek Sales, Inc., 294 Ark. 427, 743 S.W.2d 804 (1988). 21. Parkes v. Hall, 906 F.2d 658 (11th Cir. 1990).
Advertise in the next issue of The Arkansas Lawyer. Opportunities also available on ArkBar’s website and weekly ebulletins. www.arkbar.com/pages/ advertising opportunites.aspx
our clients are
appealing If Appealing Clients Aren’t Appealing to You, Call the Appealing Attorneys.
ArkansasAppeals.com
124 West Capitol Avenue, Suite 1500, Little Rock, AR 72201 501.246.8004
n
800.844.TAYLOR
n
TAYLORLAwfiRm.cOm Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
47
DISCIPLINARY ACTIONS Judicial Discipline & Disability Commission Actions
Attorney Disciplinary Actions
On November 21, 2014, the Arkansas Judicial Discipline and Disability Commission announced that an agreed Letter of Censure was issued to Fourth Judicial District, Circuit Court Judge Doug Martin of Washington County, in Commission case #14-180.
Final actions from October 1 December 31, 2014, by the Committee on Professional Conduct. Summaries prepared by the Office of Professional Conduct (OPC). Full text documents are available on-line either at http:// courts.arkansas.gov and by entering the attorney’s name in the attorney locater feature under the “Directories” link on the home page, or also on the Judiciary home page by checking under “Opinions and Disciplinary Decisions.” [The “Model” Rules of Professional Conduct are for conduct prior to May 1, 2005. The “Arkansas” Rules are in effect from May 1, 2005.]
On January 16, 2015, the Arkansas Judicial Discipline and Disability Commission announced that an agreed letter of Censure was issued to the Union County District Court Judge, George Van Hook, Jr., of Union County in the Thirteenth Judicial District in Arkansas, for Commission case #13-306, #14-185, #14-251, #14-252, #14253 and #14-254.
INITIATE DISBARMENT: The full press releases can be found online at http://www.state.ar.us/jddc/ decisions.html.
Sidney H. McCollum
COLSON, DONALD W., Bar No. 2005166, of Saline County, Arkansas. On November 21, 2014, Panel A voted an interim suspension and that disbarment
John Dewey Watson
Richard L. “Rick” Ramsay
John E. Jennings
proceedings be initiated by the Executive Director in Case No. CPC 2014-041 on a complaint brought by Sharon Cornice regarding Colson’s representation of her son on a criminal post-conviction matter, based on the panel’s findings of violations of AR Rules 1.3, 1.4(a)(3), 1.16(a)(1), 3.2, 5.5(a), and 8.4(d) and consideration of Colson’s prior disciplinary record. The interim suspension order was filed and effective on December 2, 2014. PACE, JAMES ROBIN, Bar No. 85123, of Bentonville, Arkansas. On November 21, 2014, Panel A voted an interim suspension and that disbarment proceedings be initiated by the Executive Director in Case No. CPC 2014-015 on a complaint brought by Benton County Circuit Judge Brad Karren and attorney Ted Holder of the Arkansas Securities Department (ASD) based on Pace’s involvement in matters that were part of a civil regulatory suit brought by ASD against Pace and others, including a firm named Nick Lynn Technologies,, Inc., and the panel’s findings of violations
John F. Stroud, Jr.
Samuel N. Bird
We’re as close as your phone. We mediate all over the state and beyond. You choose – your place or ours. Richard Lusby
ADR
Travis Berry
INC.
Alternative Dispute Resolution Contact us at (501) 376-2121 or go to www.mediateadr.com for more information. Scotty Shively
48
The Arkansas Lawyer
Prospect Building • 1501 N. University Avenue, Suite 630 • Little Rock, AR 72207
www.arkbar.com
Pine Drewyor
DISCIPLINARY ACTIONS of AR Rules 1.1, and 8.4(c). The interim suspension order and disbarment suit have not been filed yet as Pace has instead petitioned the Supreme Court to surrender his law license, now pending as Case No. D-14-1110. REPRIMAND: WILSON, JIMMIE LEE, Bar No. 73128, of West Helena, Arkansas, in Committee Case No. CPC 2014-027, by Findings & Order filed on October 14, 2014, was reprimanded and fined $2,500 on a complaint by attorney Chet Dunlap for violation of AR Rule 3.4(c), and also additionally reprimanded and fined another $2,500 for his failure to file a response to the Complaint. In assessing these sanctions, the panel stated it considered Wilson’s prior disciplinary record. Wilson failed to pay his 2014 Arkansas law license renewal fee when due by March 5, 2014 (deadline extended from March 1 due to bad weather and clerk’s office closing), resulting in his law license being automatically administratively
suspended until he paid his required renewal fee. As of April 25, 2014, he had not paid his 2014 fee and had his law license reinstated to good standing from its suspension. He also failed to timely pay his law license fee for the years 2004-08 and 2010-13. On April 17, 2014, while his Arkansas law license was in suspended status, in Poinsett County Circuit Court No. E-92-291 for his client Perry Vann, Mr. Wilson filed two pleadings which were served on Dunlap, attorney for Pamela Tate. On April 22, 2014, Dunlap referred the matter to OPC alleging Wilson was practicing law at a time when his Arkansas law license was in suspended status. According to the clerk’s records, Wilson paid his 2014 fee on May 5, 2014, the same day he signed for certified mail service of the Summons and this Complaint. The Arkansas Supreme Court’s decisions in Chandler v. Martin, 2014 Ark. 219 and Williams v. Martin, 2014 Ark. 210, holding Court Rule VII(C), the automatic administrative license suspension provision upon non-payment of the annual license renewal fee, was unconstitutional and
enforcement was enjoined, was not issued until May 14, 2014, after this Complaint was filed on April 30, 2014. CAUTION: DEPPER, ROBERT L., Jr., Bar No. 81046, of El Dorado, in case No. CPC 2014-009, by Findings & Order filed October 15, 2014, on a complaint generated from an appellate file, was cautioned for violation of Rule 8.4(d) and assessed costs. Depper was retained counsel in Columbia County Circuit Court DR2011-92. He filed a motion to extend time to lodge the record, the order to extend the time was granted, but the order was filed one day beyond the deadline. Depper filed a Motion for Rule on the Clerk, and the Arkansas Supreme Court denied the Motion, ending his client’s appeal. Following a committee panel public hearing, by a 6-1 vote Depper’s conduct was found to have violated Rule 8.4(d). By a 4-3 vote, no violation of Rule 1.3 was found. HILL, DONALD C., Bar No. 2008105, of Hot Springs Village, Arkansas, in
Pharmacists Optometrists
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
49
Landex Research, Inc. PROBATE RESEARCH
Missing and Unknown Heirs Located No Expense to the Estate Domestic and International Service for: Courts Lawyers Trust Officers Administrators/Executors 1345 Wiley Road Suite 121, Schaumburg, IL 60173 Telephone: 800-844-6778 Fax: 800-946-6990 www.landexresearch.com
10% discount for arkbar members*
“WordRake paid for itself in a week. Brilliant.”
—Lewis L. Cobb, Partner Spragins, Barnett & Cobb PLC
*use coupon code ArkBar for discount
Committee Case No. CPC 2014-025, by Findings and Order filed October 2, 2014, was cautioned for his conduct in the representation of Kristin Kuelbs in the matter of Kristin Kuelbs, Donald Hill, and Edwardena Hill v. Kimberly Hill, CA 091326. In 2007, Hill moved his sister Kristin Kuelbs to Garland County, Arkansas. His other sister, Kimberly Hill, then filed a Petition to be appointed as guardian for Kuelbs. Hill initially hired attorney Justin 50
The Arkansas Lawyer
www.arkbar.com
Hurst to represent himself and his wife Edwardena Hill. At some point, he also hired Hurst to represent his sister Kristin. During the case, Kristin was appointed several guardians, including Hill at one point. After being appointed guardian, Hill took on legal representation of Kristin as well. On March 19, 2009, the court appointed Kimberly as Kristin’s guardian after Hill failed to follow the court’s order to have Kristin evaluated.
This appeal was one of five filed by Hill in the guardianship case. The first appeal was from the probate court’s guardianship ruling and other intermediate rulings. The probate court continued to issue orders in the case while the first appeal was pending. The second appeal challenged the probate court’s appointment of Kimberly as guardian and the probate court’s jurisdiction to enter decrees after the first notice of appeal was filed. Both the first and second appeals were submitted simultaneously, and both affirmed the probate court’s rulings. Hill filed a third appeal again challenging Kimberly’s appointment as guardian and the probate court’s jurisdiction to enter three specific orders after the first appeal was filed. The third appeal was dismissed as to the issue of Kimberly’s appointment as guardian. This opinion arose from an issue raised in the third appeal, specifically the probate court’s orders entered on March 26, 2009, April 2, 2009, and April 24, 2009. All five appeals were filed by Hill and/ or Justin Hurst on behalf of Hill, his wife, and Kristin. In the October 26, 2011, opinion, the Court of Appeals addressed Hill’s representation of Kristin. In orders of December 23, 2008, and January 5, 2009, the probate court disqualified Hill from acting as Kristin’s attorney because of a conflict of interest. Despite having been disqualified as Kristin’s attorney, Hill persisted in filing pleadings and appeals on Kristin’s behalf. The Court of Appeals found that the notices of appeal in the case were filed in April and September 2009, long after the disqualification orders were entered. The probate court never reinstated Hill as Kristin’s attorney, nor was there any authority by Kristin’s guardian, Kimberly, for Hill to thereafter file appeals on Kristin’s behalf. HURST, JOSH Q., Bar No. 2004016, of Hot Springs, in Committee Case No. CPC 2014-043, by Consent Findings & Order filed on December 12, 2014, was cautioned on a complaint by Thomas Landis of Lawton, Oklahoma, for violations of AR Rules 1.3, 1.4(a)(3), 1.4(a)(4), 1.16(d), and 8.4(d). Landis employed Hurst, for a $2,500 flat fee, as successor counsel to defend Landis in a lawsuit in Montgomery County Circuit Court; Hurst did not enter
ArkBar Practice Handbooks
“
ArkBar Handbooks are your shortcut to fast answers for your clients! Whether it is a substantive law question or a procedural issue, let ArkBar Handbooks be your guide.”
Learn from local leading lawyers in the following fields: Bankruptcy, Business Associations, Debtor/Creditor, Domestic Relations,
—Matthew L. Fryar Cypert, Crouch, Clark & Harwell, PLLC Co-Chair of the Editorial Board for Handbooks
All new Business Associations Handbook: Corporations, limited liability Companies and Partnerships
Elder Law, Handling Appeals, Probate, Revocable Trusts, Real Estate Title Standards, Statute of Limitations and Workers Compensation.
www.arkbar.com or 501-375-4606
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
51
his appearance or keep Landis properly informed of the status of the case. Landis was forced to travel to Arkansas to check the case file and to employ new counsel as the date for depositions approached. Hurst was slow to provide his Landis file to new counsel and declined Landis’ request for a fee refund. Landis sued Hurst over the fee refund in district court and was awarded judgment for $1,825.00 plus costs. HURST, JUSTIN B., Bar No. 2005021, of Hot Springs, Arkansas, in Committee Case No. CPC 2014-026, by Findings and Order filed October 2, 2014, was cautioned for his conduct in the representation of Kristin Kuelbs in the matter of Kristin Kuelbs, Donald Hill, and Edwardena Hill v. Kimberly Hill, CA 09-1326. In 2007, Hill moved his sister Kristin Kuelbs to Garland County, Arkansas. His other sister, Kimberly Hill, then petitioned to be appointed as guardian for Kuelbs. Hill initially hired Justin Hurst to represent himself and his wife Edwardena Hill. At some point he also hired Hurst to represent his sister Kristin. During the case, Kristin was appointed several guardians, including Hill at one point. Hill was later removed by
52
The Arkansas Lawyer
www.arkbar.com
court order. On March 21, 2008, the probate court entered an order recusing Hurst and his law firm as Kristin’s attorney. Hurst was allowed to continue his representation of Hill and his wife. On April 9, 2009, Hurst and Hill filed a Notice of Appeal on behalf of Hill, his wife, and Kristin, appealing any and all orders entered between March 5, 2009, and April 9, 2009. On September 8, 2009, Hurst and Hill filed another Notice of Appeal, appealing all orders entered in the probate case since April 9, 2009. On September 9, 2009, Hurst and Hill filed another Notice of Appeal, making corrections to the notice filed on September 8. This fifth appeal in the Kuelbs guardianship case arises from an issue raised in the third appeal, specifically the probate court’s orders entered on March 26, 2009, April 2, 2009, and April 24, 2009. The appellants argued that the orders were entered erroneously and without hearing or notice. The Court of Appeals ruled that it had no jurisdiction to hear an appeal of the April 24, 2009, order as the appeal was not timely filed. The two remaining orders were timely appealed; however the court ruled that the argument was raised for the first time on appeal and the court does
not address such arguments. All appeals in the Kuelbs case were filed by Hurst and Hill on behalf of Hill, Mrs. Hill, and Kristin Kuelbs. In the October 26, 2011, opinion, the Court of Appeals addressed Hurst’s representation of Kristin. Despite having been recused, Hurst persisted in filing pleadings and appeals on Kristin’s behalf. The Court of Appeals found that the notices of appeal in the case filed in April and September 2009 were filed long after the recusal order removing Hurst as Kristin’s attorney. The probate court never reinstated Hurst as Kristin’s attorney, nor was there any authority by Kristin’s guardian, Kimberly Hill, for Hurst to file appeals on Kristin’s behalf. KING, MICHAEL J., Bar No. 88124, of Hot Springs, in Committee Case No. CPC 2013-065, by Findings & Order filed on October 6, 2014, was cautioned and ordered to pay $1,000 restitution on a complaint by Diane Dodd for violations of AR Rules 1.4(a)(4), 1.16(d), and 8.4(d). In July 2013, Dodd employed King to represent her in a child support matter in Garland County Circuit Court, and paid him his requested full $1,500 fee. Dodd and King went to court for a short hearing on July 15, 2013. Each party was directed to complete financial disclosure forms and the hearing was reset for November 4, 2013. From July 15 into late October 2013, Dodd had substantial difficulty contacting King about her case and approaching hearing. Dodd was finally able to contact King’s wife by telephone and was assured King was going to represent Dodd at the November 4 hearing. Closer to the hearing, Dodd needed confirmation King would be there, or Dodd needed to employ another attorney. Dodd employed Hot Springs attorney Ben Bancroft to represent her at the November 4 hearing and paid him a $750 retainer. Shortly before the hearing, Dodd was finally able to contact King. He informed her he was unable to give her any fee refund, even if he wanted to. Dodd gave King an opportunity to still represent her. King was asked to call Dodd the next day but did not do so. Dodd proceeded on with Bancroft. Dodd paid Bancroft a total of $1,100 for him to finish her case. Since the November 4, 2013, hearing, Dodd has not been contacted by King, nor has King provided her any refund of unearned fee.
Don’t get wrecked by stress in 2015. Call McMath Woods.
Sam Ledbetter
Bruce McMath
Carter C. Stein
Ross Noland
Phillip H. McMath
Neil Chamberlin
Charles Harrison
Will Bond
Environmental, wrongful death, injury and defective product attorneys www.McMathLaw.com | 711 West 3rd, Little Rock, AR 72201 | 501.396.5400 www.facebook.com/McMathWoods, www.twitter.com/McMathWoods www.linkedin.com/company/mcmath-woods-p-a-
ARKANSASFINDALAWYER® Market Your Law Practice for only $75/year
www.arkansasfindalawyer.com Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
53
Arkansas Bar Foundation Memorials and Honorarium The Arkansas Bar Foundation acknowledges with grateful appreciation the receipt of the following memorial, honorarium and scholarship contributions received during the period October 10, 2014, through January 15, 2015. In Memory of Virginia “Ginger” Atkinson B. Jeffery Pence Justice Annabelle Imber Tuck Mike Wilson
In Memory of James H. McKenzie Designated to the Horace H. and James H. McKenzie Scholarship Fund Judge James M. Moody
In Memory of E. J. Ball Judge John and Barbara Lineberger
In Memory of Judge William R. Overton Designated to the Judge William R. Overton Scholarship Fund Judge James M. Moody
In Memory of Jeffrey A. Bell Philip A. Kaplan In Memory of William H. Bowen Barbara Amsler Patti and Charlie Coleman Roscopf & Roscopf, P.A. Midge and John Rush Mike Wilson In Memory of Rupert “Buzz” Crafton Midge and John Rush In Memory of John A. “Jack” Davis III Designated to the John A. “Jack” Davis III Scholarship Fund Midge and John Rush John Dewey Watson In Memory of Winslow Drummond Judge James M. Moody In Memory of Dennis Haase Hyden, Miron & Foster, PLLC In Memory of Judge John N. Harkey Silas H. Brewer Justice Annabelle Imber Tuck In Memory of Dorothy Young Howard Justice Annabelle Imber Tuck In Memory of Mike Huckabay, Sr. Silas H. Brewer Hyden, Miron & Foster, PLLC Jeffrey and Lester McKinley Judge James M. Moody Justice Annabelle Imber Tuck In Memory of Earl Fletcher “Bear” Jackson John C. Calhoun Stephen Engstrom Mike Wilson 54
The Arkansas Lawyer
www.arkbar.com
In Memory of Richard Roachell Justice Annabelle Imber Tuck In Memory of Eugene L. Schieffler Justice Annabelle Imber Tuck
HONORARIUMS, SCHOLARSHIP CONTRIBUTIONS AND GIFTS In Honor of Judge Robert “Bobby” Fussell Judge James M. Moody In Honor of Judge Ben Story Roscopf & Roscopf, P.A. Friday, Eldredge & Clark/ Herschel Friday Scholarship Fund Friday, Eldredge & Clark The McKinley Family Scholarship Fund Jeffrey and Lester McKinley
In Memory of Dennis L. Shackleford Designated to the Shackleford/Phillips Scholarship Fund Susan H. Mayes
Arkansas Community Foundation Giving Tree grant for the 2015 Mock Trial Competition
In Memory of James Marlon “Jim” Simpson, Sr. Hayden and Gordon Rather
Arkansas Bar Center Memorial Wall In Memory of Mike Huckabay, Sr.
In Memory of Donald H. Smith Charles Frierson III In Memory of William “Bill” Strongfellow Hayden and Gordon Rather In Memory of N. Walls Trimble Philip Anderson Kevin Kordsmeier B. Jeffery Pence Sandy and Ken Stoll Mike Wilson In Memory of Roxanne Tomhave Wilson Designated to the Roxanne Tomhave Wilson Scholarship Fund Judge James M. Moody In Memory of Judge Henry Woods Designated to the Judge Henry Woods Scholarship Fund Judge James M. Moody
Three memorial medallions were given in memory of Mike Huckabay, Sr. from the following individuals and firm: Donald H. Bacon H. David Blair David M. Donovan William M. Griffin III Michael Huckabay, Jr. Munson, Rowlett, Moore & Boone, P.A. Edward T. Oglesby Mel Sayes Jim Simpson Laura Hensley Smith James W. Tilley Fred Ursery Richard N. Watts
IN MEMORIAM William H. Bowen William H. Bowen of Little Rock died November 12, 2014, at the age of 91. Bowen was a senior partner in Arkansas’ largest law firm, president of the state’s largest bank, chief executive officer of a health insurance company and dean of the state’s largest law school, which was later named the William H. Bowen School of Law. He was a friend and adviser to Bill Clinton and managed the governor’s office for a year while Clinton was away running for president, and also a friend and adviser to Dale Bumpers and David Pryor when they were governors and United States senators. Bowen served on countless business, professional and civic boards and state and national governmental advisory boards. He was a Navy pilot in World War II, survived a series of training crashes, and he had an extended career in the Naval Reserve. President Clinton appointed him to the Employers Support Committee for Guard and Reserve visiting Bosnia and Germany while chairman of the committee. Also, he was awarded the Secretary of Defense Outstanding Service Medal. He left the Navy and enrolled at the University of Arkansas in 1946 and then in its law school. He graduated from law school in 1949, worked briefly for a Pine Bluff law firm, and then did graduate study in tax law at New York University. In 1950, he became law clerk to Judge Bolon B. Turner of the U.S. Tax Court in Washington, D.C. and two years later joined the Trial Section of the U.S. Justice Department’s Tax Division as special assistant to the attorney general. He tried tax cases in federal district and appeals courts across the South, including Arkansas. In 1954, he joined the Little Rock law firm of Mehaffy, Smith and Williams as a trial tax specialist, switching from defending the government to defending taxpayers. The firm had seven lawyers. It would soon become Mehaffy, Smith, Williams, Friday and Bowen. It is now Friday, Eldredge and Clark and has 85 lawyers. Bowen became general counsel for the Arkansas Bankers Association and in 1970
Richard C. Butler approached Bowen about succeeding him as president of Commercial National Bank, then the fourth largest bank in Little Rock. He became president in May 1971 and began an aggressive campaign to build the bank. At the age of 72, Bowen became the dean of University of Arkansas at Little Rock School of Law in July 1995. After he stepped down, in 1998, Bowen gave the school’s largest gift in its history, to establish the Bowen Scholars Program. In 1999, the school’s faculty renamed the school the William H. Bowen School of Law. Early in his legal career, Bowen was president of the Little Rock Chamber of Commerce. He was president of the Pulaski County Bar Association and a member of the Arkansas Bar Association and the Arkansas Bankers Association. Walls Trimble Walls Trimble of Little Rock died on November 5, 2014, at the age of 94. He was born in Lonoke, Arkansas, on October 19, 1920. Walls graduated from the University of Arkansas and the University of Arkansas School of Law in Fayetteville. He was a member of Kappa Sigma fraternity, Blue Key Honorary Society and Delta Theta Phi Law fraternity. His education was interrupted by WWII where he served in the infantry. After the war, he returned to Fayetteville to complete his education in 1947. A fifth generation lawyer, Walls began his practice in Little Rock in 1947 with the law firm of Bailey & Warren. He was recalled to military service during the Korean War, serving in the Judge Advocate General Corp in Japan. He and Eugene Bailey formed the firm of Bailey and Trimble in 1958. He continued to practice in that firm which became Bailey, Trimble, Lowe, Sellars & Thomas until his death. He was a member of the American Bar, Arkansas Bar and Pulaski County Bar Associations and a Fellow in the Arkansas Bar Foundation. During his career he served as assistant attorney general and as a special judge in Chancery Courts on many occasions. His primary law practice was centered on wills, trusts and probate.
Donald Houston Smith Donald Houston Smith, 84, of Pine Bluff died January 1, 2015, at the age of 84. He graduated from Arkansas State University and the University of Arkansas Law School. He was a member of Pi Kappa Alpha Fraternity, Blue Key Law Review and ROTC. He served in the Army from 1953 to 1956 as a 2nd and 1st Lieutenant in Korea and Japan. His main duty was artillery scout. After graduating law school he practiced briefly in Blytheville, Arkansas, and then moved to Pine Bluff in 1959 where he joined the Reinberger and Eilbott law firm where he later became a partner. He retired from practice in 2001. He was a member of the Arkansas and American Bar Associations and served as president of the Jefferson County Bar Association. He was a Fellow of the Arkansas Bar Foundation. He served as a member of the Arkansas Department of Corrections Board of Directors. Ralph Rust (Rusty) Wilson II Ralph Rust (Rusty) Wilson II, of Solana Beach, CA, died December 26, 2014, at the age of 73. Rusty was part of the Lost Class of 1959 at Hall High School and graduated from the New Mexico Military Institute. He spent a semester abroad in Aix en Provence, France, while attending Vanderbilt University, from which he graduated in 1963, and he graduated from Columbia Law School in 1966. Rusty served as law clerk to Justice Paul Ward of the Arkansas Supreme Court and practiced law in Little Rock for 25 years with his great friend and mentor Sam Laser. Rusty is survived by his wife of 38 years, George Ann (Yotter) Wilson. During their careers, George Ann and Rusty traveled throughout the southeastern United States for her work and his. After Rusty’s retirement in 1993, they enjoyed touring the Southwest in their RV and made their home in several places in Arizona, New Mexico, Nevada, and California. The information contained herein is provided by the members’ obituaries.
Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
55
Classified Advertising
Index to Advertisers
WANT TO PURCHASE MINERALS AND OTHER OIL/GAS INTERESTS.
PAGE
Send details to: P.O. Box 13557, Denver, CO 80201. MINERAL RIGHTS & ESTATE APPRAISER Terrel Shields, Professional Geologist AR 25; Certified General Appraiser OK 10671 & AR 0690 Estate appraisals for land or minerals www.roxnoil.com or 479-736-2101 or cell/text 479-957-3227.
ABA Retirement
31
ADR, Inc.
48
ArJLAP
39
ArkBar Annual Meeting
Inside Front Cover
ArkBar Career Center
51
ArkBar Docs
- your -
benefits Being a member of the Arkansas Bar Association enhances your involvement in the legal community.
8
ArkBar Practice Handbooks
51
ArkBar SNAP
46
Arkansas Community Foundation
6
Arkansas Investigations
33
Bell and Company
15
Clio
41
eZdiscovery Solutions, LLC
13
Fastcase
3
FedEx
52
Ferstl Valuation Services
22
Landex Research
50
Law Offices of Darren O’Quinn
49
Law Offices of David H. Williams, PLLC
23
Law Offices of Gary Green, P.A.
33
Law Pay
35
Legal Directories Publishing
52
Lexis-Nexis
Inside Back Cover
McMath Woods P.A.
53
Regions Insurance
Back Cover
Social Finance, Inc.
45
Stein, Gerald S.
13
practice, expand their knowledge, and connect
Taylor & Taylor Law Firm, P.A.
47
with other legal professionals. Members have
The New School
15
Tschiemer Legal Briefing
27
Career Center and opportunities for connecting
University of Arkansas School of Law
39
with your peers.
Windstream
27
REVIEW YOUR BENEFITS AT WWW.ARKBARBENEFITS.COM Membership in the Arkansas Bar Association helps new and seasoned attorneys grow their
quick access to our carefully curated resources— like the new CLE Pass, Fastcase for research, our
Wordrake 50 Vol. 50 No .1/Winter 2015 The Arkansas Lawyer
56
Finishing your work sooner doesn’t mean taking a break, it means getting more done. With Lexis® for Microsoft Office®, you can drastically reduce the time spent drafting and responding to legal documents by doing it all within the Microsoft® applications you use every day. So you can complete briefs with unprecedented speed and protect your train of thought. Learn more at lexisnexis.com/office #BeUnprecedented
NOW I COMPLETE BRIEFS FASTER THAN EVER. BUT I WON’T SLOW DOWN.
LexisNexis, Lexis, and the Knowledge Burst logo are registered trademarks of Reed Elsevier Properties Inc., used under license. Microsoft is a registered trademark of Microsoft Corporation. Other products or services may be trademarks or registered trademarks of their respective companies. © 2014 LexisNexis. All rights reserved. LMO201401
Professional Liability Program 40,000 lawyers are expert witnesses to our reputation. Top law firms trust CNA’s Professional Liability Program. As part of an insurance organization with $60 billion in assets and with an “A” rating by A.M. Best, we help clients manage malpractice risks.
See how our legal expertise can help your firm by contacting
Regions Insurance 888-272-6656
1500 Riverfront Drive, Suite 110, Little Rock, AR 72202 Suzanne Tipton at 501-660-7125 (suzanne.tipton@regions.com) Tiffaney Davids at 501-661-4957 (tiffaney.davids@regions.com) The only endorsed professional liability plan of the Arkansas Bar Association.
www.arkbar.com / www.lawyersinsurance.com CNA is a service mark and trade name registered with the U.S. Patent and Trademark Office. The program referenced herein is underwritten by one or more of the CNA companies.