HURT-HOOVER INVESTMENTS, LLC, Appellant, v. Lester FULMER, Rob Bentley, Robert Best, and Carl Chilson, Appellees.
No. CV-14-311.
Supreme Court of Arkansas.
Nov. 6, 2014.
2014 Ark. 461
Richard Mays Law Firm, PLLC, Heber Springs, by: Richard H. Mays, for appellees.
COURTNEY HUDSON GOODSON, Justice.
Appellant Hurt-Hoover Investments, LLC (Hurt-Hoover), appeals the judgment entered by the Cleburne County Circuit Court after a jury returned its verdict in favor of appellees Lester Fulmer, Rob Bentley, Robert Best, and Carl Chilson. For reversal, Hurt-Hoover contends that the circuit court erred in ruling that venue for this civil action concerning a debt and note was proper in Cleburne County and that the court erred by denying its motion for withdrawal of counsel and its concomitant request for a continuance. Our jurisdiction is pursuant to Arkansas Supreme Court Rule 1-2(e), as we granted appellant‘s petition to review the decision of the Arkansas Court of Appeals affirming the judgment. See Hurt-Hoover Invs., LLC v. Fulmer, 2014 Ark. App. 197, 433 S.W.3d 917. We also find no reversible error and affirm.
Factual Background
The record discloses that the parties entered into a contract for Hurt-Hoover to purchase appellees’ interests in H20 Lifts and Ramps, LLC. Pursuant to their agreement, dated June 19, 2008, Hurt-Hoover agreed to pay the total sum of $955,000 for the business, which included an initial cash payment of $400,000 that was remitted at the time of closing. Hurt-Hoover executed individual promissory notes to each appellee, according to their respective interests, for payment of the balance in thirty-six monthly installments, commencing on October 1, 2008.
On May 28, 2009, appellees filed suit against Hurt-Hoover in Cleburne County Circuit Court, alleging that Hurt-Hoover had wholly failed to pay the installments due under the promissory notes. In their complaint, appellees alleged that venue was proper in Cleburne County, where they all resided, pursuant to
The circuit court held a hearing on the issue of venue on November 16, 2010. At the hearing, Hurt-Hoover asserted that
On May 17, 2011, appellees filed a motion for summary judgment, arguing that there were no material facts in dispute that Hurt-Hoover had defaulted on its obligations under the promissory notes. They also contended that the indemnity provisions of the agreement, relied on by Hurt-Hoover to support its claim of set-off, applied only to damages that Hurt-Hoover might incur from a third party but not for any claims Hurt-Hoover may have against them. Thus, they argued that they were entitled to judgment as a matter of law. In response, Hurt-Hoover maintained that the agreement endowed it with the right to set off damages it incurred as a result of appellees’ alleged misrepresentations and breaches of warranty and that the agreement also stated that the exercise of its right to set-off was not an event of default. Hurt-Hoover also filed a counterclaim alleging breach of contract and the claim for set-off.
The circuit court held a hearing on the summary-judgment motion on November 2, 2011. The court entered an order denying the motion on June 1, 2012.1 In relevant part, the court‘s order provided,
2. Plaintiffs contend that defendant has defaulted on certain promissory notes.
3. Defendant contends that it is allowed to take certain set-offs pursuant to paragraph 6.01 of the Interests Purchase and Sale Agreement entered into between the parties on June 19, 2008 (the “Agreement“).
4. Plaintiffs reason that because there have been no claims for indemnification made by an third party, then defendant is not entitled to take any set-offs.
5. Plaintiffs would be correct if the issues in the case involved a simple indemnification agreement. However, the Court finds that because of the language in paragraph 6.01(a) of the Agreement, there is a fact question as to what plaintiffs promised to indemnify against.
6. Paragraph 6.01(a) of the Agreement could be interpreted as providing indemnification to the defendant for damages and losses resulting from any “misrepresentation, breach of warranty, or failure to perform any covenant or agreement undertaken by seller in this agreement.”
7. The Court finds that there is a fact question as to whether or not plaintiffs agreed to indemnify defendant and hold defendant harmless for damages from any misrepresentation, breach of warranty, or failure to perform under the terms and conditions of the Agreement. This issue is to be determined by a trier of fact. Consequently, plaintiffs’ Motion for Summary Judgment is denied.
Thereafter, the circuit court scheduled the trial for July 19, 2012. On June 19, 2012, Hurt-Hoover filed a motion for the withdrawal of counsel, asserting that it
After considering the evidence, the jury returned its verdict in favor of appellees on their complaint and against Hurt-Hoover on its counterclaim. Accordingly, the circuit court entered judgment in favor of appellee Fulmer in the amount of $294,705; appellee Bentley in the amount of $229,215; appellee Best in the amount of $65,490; and appellee Chilson in the amount of $65,490. This timely appeal followed.
Hurt-Hoover presents, essentially, two issues on appeal. First, it contends that the circuit court erred in denying its motion to dismiss on the question of venue by ruling that
Repeal by Implication
As its first argument on appeal, Hurt-Hoover argues that the two venue statutes are not in conflict and that the circuit court erred in ruling that venue was proper in Cleburne County based on its ruling of repeal by implication. Further, it contends that, because
This court has outlined its statutory construction rules regarding repeal by implication on numerous occasions. See Doe v. Baum, 348 Ark. 259, 72 S.W.3d 476 (2002). The fundamental rule of the doctrine is that a repeal by implication is not favored and is never allowed except when there is such an invincible repugnancy between the two provisions that both cannot stand. Brock v. Townsell, 2009 Ark. 224, 309 S.W.3d 179. A statute of a general nature does not repeal a more specific statute unless there is a plain, irreconcilable conflict between the two. Moreover, we will not find a repeal by implication if there is any way to interpret the statutes harmoniously. Neeve v. City of Caddo Valley, 351 Ark. 235, 91 S.W.3d 71 (2002). Thus, repeal by implication is recognized in only two situations: (1) where the statutes are in irreconcilable conflict, and (2) where the General Assembly takes up the whole subject anew, covering the entire subject matter of the earlier statute and adding provisions clearly showing that it was intended as a substitute for the former provision. Lambert v. LQ Mgmt., LLC, 2013 Ark. 114, 2013 Ark. App. 114, 426 S.W.3d 437.
It is well established that the General Assembly is vested with the power to establish venue under the Arkansas Constitution. Farm Bureau Mut. Ins. Co. of Arkansas, Inc. v. Gadbury-Swift, 2010 Ark. 6, 362 S.W.3d 291. The primary purpose of venue statutes is to provide a convenient, logical, and orderly forum for the resolution of disputes. Wright v. Centerpoint Energy Res. Corp., 372 Ark. 330, 276 S.W.3d 253 (2008). It is this court‘s fundamental duty to give effect to the legislative purpose set by the venue statutes. Centerpoint Energy, Inc. v. Miller Cnty. Circuit Court, 372 Ark. 343, 276 S.W.3d 231 (2008).
Since 1838, the General Assembly has provided that, in the absence of a statutory exception, the basic rule of venue is that a defendant must be sued in the county where he or she resides or is summoned. Clark v. Johnson Reg‘l Med. Ctr., 2010 Ark. 115, 362 S.W.3d 311. Consistent with that general rule,
In 2003, the General Assembly passed Act 649, the “Civil Justice Reform Act of 2003,” which primarily focused on tort reform; however, Act 649 also included certain venue provisions, including the one at issue here. Id. Specifically,
(1) The county in which a substantial part of the events or omissions giving rise to the claim occurred;
(2)(A) The county in which an individual defendant resided.
(B) If the defendant is an entity other than an individual, the county where the entity had its principal office in this state at the time of the accrual of the cause of action; or
(3)(A) The county in which the plaintiff resided.
(B) If the plaintiff is an entity other than an individual, the county where the plaintiff had its principal office in this state at the time of the accrual of the cause of action.
On two previous occasions, this court has addressed whether
By contrast, we reached a different result in Dotson v. City of Lowell, 375 Ark. 89, 289 S.W.3d 55 (2008). There, the issue was whether
In the present case, we reach the same conclusion as we did in Wright and hold that
Our view that
strue
Parol-Evidence Rule
Hurt-Hoover also contends that the circuit court erred by refusing to allow the testimony of the attorney who drafted the agreement. It contends that counsel‘s testimony was not barred by the parol-evidence rule because the circuit court found that the language used in the agreement was ambiguous.
The parol-evidence rule prohibits the introduction of extrinsic evidence, parol or otherwise, which is offered to vary the terms of a written agreement; it is a substantive rule of the law, rather than a rule of evidence, and its premise is that the written agreement itself is the best evidence of the intention of the parties. Stilley v. James, 345 Ark. 362, 48 S.W.3d 521 (2001). On the other hand, the parol-evidence rule does not prohibit the introduction of extrinsic evidence where it would aid the court in interpreting the meaning of particular language of a contract, such as when the contract contains terms of art or words which have acquired their meaning through a course of dealing or custom or usage. First Nat‘l Bank of Crossett v. Griffin, 310 Ark. 164, 832 S.W.2d 816 (1992). Nor does the parol-evidence rule prohibit the court‘s acquainting itself with the circumstances surrounding the making of the contract. Id. Where the meaning of a written contract is ambiguous, parol evidence is admissible to explain the writing. C & A Constr. Co. v. Benning Constr. Co., 256 Ark. 621, 509 S.W.2d 302 (1974). The initial determination of the existence of ambiguity rests with the court and, if the writing contains a term which is ambiguous, parol evidence is admissible and the meaning of the ambiguous term becomes a question of fact for the fact-finder. Griffin, supra.
On appeal, we will not reverse a circuit court‘s ruling on the admission of evidence absent an abuse of discretion. GSS, LLC v. CenterPoint Energy Gas Transmission Co., 2014 Ark. 144, 432 S.W.3d 583. This court has stated that abuse of discretion is a high threshold that does not simply require error in the trial court‘s decision, but requires that the trial court act improvidently, thoughtlessly, or without due consideration. Coker v. Coker, 2012 Ark. 383, 423 S.W.3d 599.
In the proffer, Jones stated that he drafted the purchase agreement while representing Hurt-Hoover. Upon Mike Hoover‘s request, he included the indemnity provision to provide protection for the buyer against certain liabilities. Jones said that the provision was intended to protect the buyer with respect to warranty representations made by the sellers in connection with the sale, including statements about the nature of the company itself. He added that the intent was to afford the buyer the ability to offset any damages. Jones acknowledged, however, that appellees were not represented by counsel, and he did not recall whether he advised appel-
lees
We find no error in the exclusion of the testimony. As we explained in Kerr v. Walker, 229 Ark. 1054, 321 S.W.2d 220 (1959), when admissible, parol evidence must relate to an understanding that was common to both parties, as parol evidence is not permitted to show the uncommunicated subjective interpretation that one party placed on the language of the agreement. Although the circuit court found that the language of the contract was ambiguous, Jones‘s proposed testimony related only to his and Hurt-Hoover‘s construction of the indemnity provision. As such, the testimony was not admissible as parol evidence, and the circuit court did not abuse its discretion by not allowing the introduction of the testimony.
We need not reach Hurt-Hoover‘s related argument that the circuit court erred by denying its motion for a continuance. This request was predicated on the success of its motion for the withdrawal of counsel so that Jones could testify. Because the circuit court did not err by excluding Jones‘s testimony, the denial of the motion for a continuance is of no consequence.
Affirmed; Arkansas Court of Appeals’ opinion vacated.
COURTNEY HUDSON GOODSON
Justice