Articles Posted in Arkansas Supreme Court

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Dale Ladd hired Hammerhead Contracting & Development, LLC to build a house. After a dispute arose regarding the amount owed for the construction of Ladd’s home, Brandon Holmes filed a Laborer’s, Mechanic’s, or Materialman’s Lien on behalf of the LLC for the amount of $101,676, the additional amount Hammerhead asserted that Ladd owed. Ladd filed suit against Holmes to remove the lien. Hammerhead then filed an amended complaint against Ladd seeking judgment for the $101,676. The cases were consolidated. The circuit court (1) granted Ladd’s motion to dismiss Hammerhead’s complaint because of its failure to give the notice required by Ark. Code Ann. 18-44-115; (2) granted summary judgment in favor of Ladd on Ladd’s complaint and ordered the lien canceled; and (3) found that Ark. Code Ann. 18-44-115(a)(4), which bars suit by a contractor who fails to provide statutory notice, is constitutional. The Supreme Court reversed, holding that the circuit court erred in finding that the direct-sales exception in Ark. Code Ann. 18-44-115(a)(8) to the residential preconstruction-notice requirement can never apply to a contractor. View "Hammerhead Contracting & Dev. v. Ladd" on Justia Law

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This dispute centered on a contract for the construction of a residence. The contract between the general contractor (Contractor) and the owners (Owners) was contingent upon Owners obtaining financing. After construction was completed, Contractor asserted a materialman's lien on the house, arguing that Owners had refused to fully compensate Contractor. After Owners filed suit to protest the lien, the parties agreed to discharge the lien. Contractor later sued Owners based on Owners' failure to disclose that they had obtained inadequate financing. The circuit court dismissed the complaint on the grounds that Contractor's claims were statutorily barred for failure to strictly comply with requirements for the notice of its lien. The order was silent as to the other two grounds Owners had asserted for dismissal and with respect to any of the arguments raised in defense of Owners' motion to dismiss. Contractor appealed, arguing reversal based on other arguments raised below but not ruled on. The Supreme Court affirmed, as (1) the circuit court did not provide a ruling on Contractor's first three arguments, and they were therefore not preserved for appellate review; and (2) Contractor's fourth argument had no merit given the Court's summary affirmance on the first three points. View "TEMCO Constr., LLC v. Gann" on Justia Law

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A construction company and its principals (collectively, Appellants) hired a plumbing company (Peters), excavation company (Bostic), and marble company (Esquire) as subcontractors for the construction of Appellants' home. After Buyers purchased the home, Buyers filed a complaint against Appellants, alleging negligence and breach of the implied warranties of habitability, sound workmanship, and proper construction. Appellants filed a third-party complaint against Peters, Bostic, and Esquire, alleging several causes of action. Bostic subsequently filed cross-claims against Peters, and Peters filed cross-claims against both Bostic and Esquire. Thereafter, the circuit court (1) granted Peters' motion for summary judgment on the third-party complaint, (2) granted summary judgment for Bostic on Peters' cross-claim, and (3) granted Esquire's motion for summary judgment on the third-party complaint. Appellants appealed. The Supreme Court dismissed the appeal, holding that the Court lacked jurisdiction because a final order had not been entered disposing of all the claims. View "J-McDaniel Constr. Co. v. Dale E. Peters Plumbing Ltd." on Justia Law

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Circle D Contractors filed suit in district court to collect from the Bartletts money owed for the installation of a swimming pool. The district court ruled in favor of Circle D. The Barletts appealed. Circle D did not refile an additional complaint within thirty days, and the Barletts moved to dismiss Circle D's complaint as untimely. The circuit court dismissed the complaint, ruling that Circle D had failed to strictly comply with the requirements of District Court Rule 9 by failing to timely refile its complaint in circuit court. The Supreme Court reversed, holding (1) only substantial compliance with the rule that a plaintiff refile its complaint in circuit court is required; and (2) Circle D substantially complied with rule 9 because all of its pleadings that were previously filed in district court were filed in circuit court, albeit by the Bartletts, and moreover, Circle D also refiled its complaint in circuit court. Remanded. View "Circle D Contractors, Inc. v. Bartlett" on Justia Law

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At issue in this appeal was whether a seventy-five-day lien notice sent by Appellant, Ground Zero Construction, to Appellees, Walnut Creek, LLC and Rees Development, complied with the requirements of Ark. Code Ann. 18-44-115(e)(2)(C)(i), which requires that the notice contain a "general description of the labor, service, or materials furnished." The lien notice was provided in connection with sums owed and unpaid for labor and materials provided to Appellees for the construction and improvements of water and sewer for a subdivision. The circuit court concluded that the notice did not comply with the materialman's statute. The Supreme Court affirmed, holding that Ground Zero's description of the labor, service, or materials furnished did not comply with the statute because Ground Zero essentially provided no description at all. View "Ground Zero Constr. v. Walnut Creek, LLC" on Justia Law

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This case began as a dispute over construction costs between Appellee TriBuilt Construction Group, LLC and Appellants NISHA, LLC and Centennial Bank. After Appellee filed suit against Appellants, the circuit court ordered arbitration with regard to Appellee's claims. Appellee subsequently decided to represent itself in the arbitration and circuit court proceedings. Appellants filed a petition for a permanent injunction requesting the circuit court to enjoin the corporation's officers, director, or employees from representing Tribuilt in the circuit court or arbitration proceedings. The circuit court denied Appellants' petition so far as it pertained to arbitration proceedings, holding (1) nonlawyer representation in an arbitration proceeding does not constitute the practice of law; and (2) an arbitrator, rather than the court, should determine issues regarding legal representation during arbitration proceedings. The Supreme Court reversed, holding (1) a corporate officer, director, or employee who is not a licensed attorney, engages in the unauthorized practice of law by representing the corporation in arbitration proceedings; and (2) issues regarding legal representation during arbitration proceedings fall squarely within the ambit of the court's constitutional powers and may not be decided by an arbitration body. View "NISHA LLC v. TriBuilt Constr. Group, LLC" on Justia Law

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May Construction Company appealed from a circuit court order declaring a lien on real property, owned by Town Creek Construction & Development, subordinate to a mortgage filed by Chambers Bank and unenforceable against a lien bond issued by Ohio Casualty Insurance Company. For reversal, May argued that the circuit court erred in (1) interpreting the materialmen's lien statute, (2) ruling that construction commenced after the execution of Chambers's mortgage, and (3) finding that May could not recover against the lien bond. Town Creek cross-appealed, arguing that the circuit court erred in ruling that May was entitled to a lien in the amount of $353,000. The Supreme Court reversed and remanded the direct appeal, holding that the circuit court erred in ruling that construction had not commenced prior to the recording of Chambers's lien because the ruling was based on the intent of the parties contrary to that plain language of the materialmen's lien statute. The Court then affirmed the cross-appeal, finding that the circuit court did not err in calculating the amount Town Creek owed May.

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Appellant brought an interlocutory appeal from the circuit court’s denial of its motion to compel arbitration. The appellee argued that appellant’s appeal was untimely filed. To be timely, appellant was required to file its notice of appeal within thirty days of the order denying the motion to compel arbitration, which was entered on December 28, 2009. At issue was whether appellant’s January 4, 2010 motion to dismiss constituted a post-order motion that would have extended the time for filing the notice of the appeal under Ark. R. of App. P. Civ. 4(b). The Court concluded that because the motion substantively sought to correct procedural defects in a December 21, 2009 motion, the January 4 motion was not a new motion and was treated by the circuit court as one for reconsideration. Because it was a collateral motion, it did not extend the time for filing the notice of appeal. The Court held the appellant’s notice of appeal filed on March 19, 2010 was untimely and dismissed the appeal.

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Appellants Bunn Builders, Inc. (Bunn) hired Appellees Richard Womack and Roy Turner (Womack & Turner) to paint the ground floor office of the Bunn Building in Arkadelphia. On August 19, 2004, a fire was reported at the building. The building sustained major structural damage as a result of the fire. Bunn insured the building through Employers Mutual Casualty Company (EMC). Within a few days, EMC hired investigators to find the cause and origin of the fire. The investigators asked Womack & Turner's liability insurance carrier Farm Bureau Mutual Insurance Company of Arkansas, Inc. (Farm Bureau) to preserve certain items for testing. In particular, they requested to test a halogen work lamp that the painters used on the Bunn job. EMC later sent a letter to Farm Bureau stating that EMC believed that the electrical components from the "electrical tools" used on the job were eliminated as a possible cause for igniting the fire. Testimony at trial by Womack & Turner revealed that EMC believed that the halogen lamp had been eliminated as a possible cause. However, EMC's investigators submitted reports identifying the lamp as the possible source of ignition. These reports were not sent to Farm Bureau. Farm Bureau wanted to do its own independent testing and asked EMC for the tools. EMC admitted that it had destroyed the items once its investigation was complete. Bunn and EMC sued Womack & Turner for negligence, alleging that the halogen lamp started the fire. In their response, Womack & Turner raised the issue of "spoliation," arguing that Bunn and EMC had a duty to preserve the evidence if they intended to sue for negligence. A trial was held, and the jury was given an instruction on "spoliation." The jury returned a verdict in favor of Womack & Turner. On appeal to the Supreme Court, Bunn and EMC argued that it was an abuse of discretion for the trial court to instruct the jury on spoliation. The Supreme Court found that the trial court did not abuse its discretion, and affirmed the decision in favor of Womack & Turner.