*1
in each room at
times
a
at the
actually
goal,
all
not policy,
course,
time James’s
to
arose. Of
the nurses are
problem
this litigation,
regarded
and their
cannot
testimonies
be
Co.,
17, 553
Brandon
S.W.2d 227
undisputed. Nipper v.
(1977). However, more on
the trial
must review
point,
court’s
direction
a verdict for nurses Swayze
Tully by
and
the
examining
light
losing
evidence
most favorable to
party,
here. Keck
American
Employment
Inc.,
Furthermore,
Agency,
the evidence
given
must
all reasonable inferences
conclu
sions that work in favor of the
if there
losing parties. Generally,
is
evidence,
conflict
or we find the
is not in
evidence
but is
dispute,
in such a state that
might
fair-minded people
conclusions,
different
then a
and a
jury question
presented,
Id.,
directed
will be
at
verdict
overturned.
For herein, we given reasons reverse and remand this cause for a trial. new
Madeline TALBOT and v. Thomas Jr. JANSEN and Janet Honeycutt 87-20
Supreme Court of Arkansas delivered Opinion February *2 Hall, Jr., Hall & Vaught, by: Wesley John for appellants. Catlett, Bonds & Victor A. Stubblefield, Fleming, by: Lindsey & Wright, Jennings, for Fleming; appellees. Cromwell, Jan R. litiga- Associate Justice. This Special tion arises from the January stock corporate of “That Little Ben by Restaurant” appellant loaned money to him Madeline Talbot. The sellers by appellant were John C. Smithers and Thomas Jansen and Janet appellees sale, In the contract of Honeycutt. Smithers represented $26,104.35, liabilities of the restaurant as when in fact being they $90,794.95. Jr., were note to defaulted on his Madeline Talbot a receiver the restaurant May at of Madeline Talbot. request authorized the causes action behalf of owner of restaurant and in receiver filed a breach against of contract action John C. Smithers and for the amount of the liabilities understated Smith- by ers. No claim for was brought by fraud the receiver.
On October the receiver recommended that 15,000 $ appellees’ settlement offer of and on Decem- accepted ber 9 the settlement was the chancellor as a approved “just fair” resolution of the between the On December dispute parties. *3 13,1985, appellant Madeline Talbot filed a for modifica- motion tion of the December order and filed a of notice and appeal 19,1985. designation of record on December failed to She and 7,1986, appeal May the circuit was court complaint dismissed. 14, 1986,
On April Ben and Madeline Talbot filed this cause of action against Jansen and Honeycutt for compensatory punitive damages to be the of alleged result the fraudulent by John C. Smithers. The misrepresentations alleges complaint that the Smithers understated knowingly outstanding restaurant, of liabilities the thereby fraudulently Jr., inducing to purchase the restaurant and further inducing Madeline Talbot to the The finance purchase. complaint Smithers, alleges that as the agent, and Jansen and Honeycutt, sale, the parties to of contract from profited such fraud. The fraud alleged was 13, 1983, to have occurred on January but not 15, 1983, discovered until when an the accounting of liabilities was moved to dismiss the com- completed. Appellees for plaint, on res summary judgment judicata based statute of limitations. The motions were and the Talbots have granted appealed.
There are three questions to decided: When (I) to a of lawsuit elect to sue for breach contract, are they thereafter from a bringing barred subsequent lawsuit on the issue of fraud in of the inducement that contract when all issues of the lawsuit fall subsequent necessarily within i.e., the issues the . case . . res previous judicata? to run an begin of limitations
(II) When does the statute for fraud on contract? action the receiver What does a (III) relationship appointed and shareholders that bear to the corporation principals when the behest those that receiver is at corporation shareholders, is authorized file or where principals (or or were present suits and where shareholders principals hearings? counsel) at all represented
I Res Judicata in order for rule in Arkansas that general doctrine it must apply appear of res judicata determined or involved was raised and matter particular might that it within issues necessarily [Emphasis been action. litigated previous added.] State, Green, (8th 1977); Cir. Turner v. Howard v. 555 F.2d v. Citizens Bank Martin Beebe, for summary In motion considering appellee’s we must judgment, allegations view the of the pleadings *4 Inc., Realty, most Moeller v. Theis light favorable to appellants. Builders, 266, (1985); Township 13 Ark. App. Co., 487, S.W.2d Inc. v. Kraus Construction case, of has at all times In this the point controversy suit, In appel been the misstatement of liabilities. the previous receiver lants elected to sue for breach of contract. The knew issue, the fraud did not raise The complaint about but it. through. did dismissed. but not follow In Appellants appealed, bar, facts, rename their action they the case at the same but allege “fraud,” Res damages. and seek The facts are identical. punitive applies. judicata
II Statute Limitations of 1962): We are Ark. Stat. Ann. 37-206 dealing (Repl. § an action for fraud within from the brought years must three date cause of action accrues. of running
“Fraud does the statute of suspend limitations, and the in remains effect until suspension party having the cause of action or should have discovers fraud discovered it exercise reasonable diligence.'” (Emphasis McCann, 28, added.) Hughs App.
(1984). The arises as to whether the used question appellants due diligence to discover the fraud. 25,
It is relevant that on March and March respectively, and civil commitment guardianship actions had been filed Ben in against Pulaski Probate Court with acting Madeline Talbot Madeline Talbot was petitioner. and authorized to temporary guardian take possession and administer his It was not until property. May that Madeline Talbot filed the for receivership. petition
Without giving details and based all the unnecessary upon facts presented, including the family’s knowledge of Ben Talbot’s situation, mental it is obvious that Madeline Talbot did not use diligence due to discover fraud. Either Ben Talbot did not use diligence or was from so. incapacitated doing
Ill The Role the Receiver this case was appointed at Madeline Talbot’s of, at, and she had request notice was or was present represented in all hearings involving Jr. When she disagreed with court’s chancery judgment, she filed an but then appeal abandoned it.
A receiver is a fiduciary representing all interest. A receiver is an “embodiment the creditors” them, standing as agent them with to do representing power acts that a agent mere of the defunct could not do. See company *5 Phrases, 36 Words and Perrine, 741-42 [citing Wimpfheimer 356, 65 Waterworks, 50 A. N.J. 770 N.E. Eq. (1901); Peabody v. 625, 184 Ill. 56 N.E. (1901)]. 957 This power bringing includes 2d, suit behalf of creditors. See 66 Jur. generally Am. 449, Receivers and 450 452 alia [citing inter Converse §§ 542 749, 415
Hamilton, 243, (1912).] S.Ct. 56 L.Ed. 32 224 U.S. court order to authorized by Receiver Bryant the business. He to the owner of causes of action available between the is allege identity not to fraud. There sufficient elected this and the to bar lawsuit. receiver appellants court in all The trial is affirmed respects. Sp. C.J., J.,
Edwards, Newbern, and dissent. J., Holt, C.J., Dudley, not participating. Justice, dissenting. Chief Edwards, Special Robert decree bars a res a judicata provides prior doctrine of involves same suit when the cause subsequent subsequent in the suit between the subject matter as that determined former of law bar extends to those same parties, questions Turner v. were might fact which have been but not presented. State, 367, 452 v. Citizen’s (1970); 248 Ark. S.W.2d 317 Martin Beebe, 145, (1984). 283 Exactly Bank Ark. the same in order to render issues required are is if in a suit res since it sufficient adjudicated judicata, former v. Arkansas Public there is a substantial Wells identity parties. 481, Commission, (1981); S.W.2d 718 Service Jones, Knott v. App. Estate of (1985). Talbot that since Madeline insti- argue appellant
Appellees being tuted a in a receiver chancery resulting action Restaurant,” for “That Little and since under against instituted a circuit court action an appellees contract, present indemnification in the stock clause subject res since it involves judicata suit for fraud barred by receiver, which could been raised party matter identity substantial to the appellants. states,
As the motion majority considering appellees’ pleadings we view the summary judgment, allegations Also, most case light appellants. favorable defense of res have the establishing burden Ark. Association v. Wyatt, Southern Farmers judicata. Hurst, Hurst v. S.W.2d 360
543 If the fraud was brought, was known at the time the suit prior I that agree suit breach of contract bars a prior alleging suit subsequent alleging between the same fraud in parties However, of the in this procurement agree contract. I do not case the suit involved the same or prior parties substantial identity to the appellants.
The receiver was for the business “That Little appointed Restaurant.” The receiver was authorized to actions pursue available to the owner of “That Little The owner of Restaurant.” “That Little Restaurant” was the corporation.
The present claim alleges damages to the personal appel- lants as a result of fraudulent made to misrepresentations Talbot, Jr., appellant Ben which were relied on by appellant Madeline Talbot, Jr., Talbot when she loaned to Ben money to stock I cannot that the receiver corporation. agree in the circuit court case was a with substantial to party identity appellants. receiver was to protect preserve restaurant, the assets of the performance those duties he given to actions authority available to the corporation. While the question whether or not the receiver was a proper party bring us, the circuit court suit is not before it should be noted that the order of the chancery approving circuit court settlement reflects that the small settlement was being approved because part merit of possible a defense raised in the circuit court case by appellees alleged that the loss was a Talbot, Jr., loss personal of Ben and not a loss. corporate The receiver’s selection of a cause of action in a suit for the corporation Talbot, Jr., over which Ben and Madeline Talbot had no control should not preclude later cause of action wherein and Madeline Talbot seek to recover damages personal to them for fraudulent to the misrepresentations relating stock purchase. the motion for
Accordingly, should summary judgment have been res granted the issue of judicata.
Also, we have held that in order to on a motion prevail dismiss the limitations, on the complaint basis of it must be barred Furthermore, on its statute, face. we construe strictly and if doubt, there is reasonable we will resolve the in favor question of the complaint standing against the v. challenge. Dunlap McKim (1984);
McCarty, S.W.2d
McLiney,
Jefferson
*7
Nero,
302,
(1955).
Further, 2d, Limitations Am. stated in 51 Jur. § may mere or failure to disclose 148(1970), “Although silence statement, concealment, word in itself constitute fraudulent of the truth renders or act which tends to the suppression concealment fraudulent.” during that alleges
Appellants’ complaint negotiations 13, 1983, John C. Smithers on made January fraudulent lia- misrepresentations concerning the corporation’s bilities and had the true financial condition of the corporation known, been the sale and loan would not have occurred. The complaint further that the alleges did not discover the appellants fraud until 1983. April suit was filed Appellants’ April 1986.
Appellees’ motion to dismiss does not allege appellants discovered the fraud prior 1983. Neither does the April motion allege that did not due appellants diligence use to discover the fraud. While questions of fact arise in may a trial of this 15,1983, matter as to whether was the date of or discovery as to whether or not the exercised due appellants diligence to fraud, record, discover the based on the question whether or not the 15,1986, statute was tolled until *8 should be an issue of fact to be decided in a trial. Crossett Health Center v. Croswell, Crissman Carl-Lee, Therefore, S.W. 133 (1918). appel- lees’ motion to dismiss on the basis of limitations should not have been granted.
I would reverse and remand this cause to the trial court for further proceedings. J.,
Newbern, joins the dissent. JONES, L. Judy Colvin STATE of Judy Arkansas a/k/a
Supreme Court of Arkansas Opinion delivered February