Dodson, M.D. v Allstate Insurance Co.

• Decision Date: 28 June 2001
• Docket Number: 00-456
• Citation: 47 S.W.3d 866
• Parties: JON H. DODSON, M.D., APPELLANT, VS. ALLSTATE INSURANCE COMPANY, APPELLEE.SUPREME COURT OF ARKANSAS Opinion Delivered
• Court: Arkansas Supreme Court

JON H. DODSON, M.D., APPELLANT VS ALLSTATE INSURANCE COMPANY, APPELLEE

No. 00-456

SUPREME COURT OF ARKANSAS

Opinion Delivered June 28, 2001

APPEAL FROM THE PULASKI COUNTY CIRCUIT COURT, SEVENTH DIVISION NO. CV 97-9562, HON. JOHN BERTRAN PLEGGE, JUDGE, REVERSED AND REMANDED.

JIM HANNAH, Associate Justice

Appellant Jon Dodson, M.D., appeals a Pulaski County jury's verdict finding in favor of Appellee Allstate Insurance Company on claims of defamation and tortious interference with a contract. This court accepted this case on March 9, 2001, pursuant to Ark. Sup. Ct. R. 1-2(g). Dodson raises ten points on appeal. We hold that the trial judge erred in ruling that Allstate's withdrawn counterclaim could not be used at trial as evidence that Allstate defamed or interfered with Dodson's contractual relationships with his patients. We reverse and remand.

Facts

On September 3, 1997, Dodson filed a complaint against Allstate and two of its agents in Arkansas, Bobbie Waddell and John Runkle, alleging that these employees, at Allstate's direction, defamed Dodson by representing to insureds and claimants that Dodson provided unqualified physical-therapy treatment at his office and that this amounted to fraud. Dodson also complained that Allstate represented that he overcharged for treatment, and that his medical practice was illegal.¹ Dodson further alleged that these defamatory statements were made with an intent to damage his professional reputation. Allstate, Waddell, and Runkle answered on September 5, 1997, and they then filed a counterclaim on November 7, 1997. In the counterclaim, Allstate, Waddell, and Runkle alleged that Dodson did not employ state-licensed physical therapists at his clinic, that Dodson intended to deceive and defraud, that these acts violate the Arkansas Physical Therapy Act, that Dodson knowingly collected money for unlawful and unnecessary treatment, and that Dodson misrepresented to Allstate the treatment he provided to patients. Allstate further requested an accounting for the previous five years and sought punitive damages. Dodson moved to dismiss the counterclaim and filed his answer to the counterclaim on November 26, 1997.

On December 17, 1997, Dodson filed his first amended complaint in which he alleged a claim for civil conspiracy among the defendants wherein they targeted Dodson and others to put them out of business in order to increase their profits. Dodson alleged that these practices by the defendants were performed as unfair methods of competition, that Allstate attempted to induce claimants to forego their rights to due process to seek medical attention, and that Allstate set out on a course to destroy Dodson's reputation and business. Dodson further alleged specific acts performed by Waddell and Runkle in furtherance of these claims. Over the course of the case, the parties filed various requests for discovery, admissions, and production of documents. The parties exchanged motions to compel, motions to deem admissions admitted, and motions to strike discovery answers. Due to the constant bickering among the parties, the trial court entered an order on December 14, 1998, noting that the parties agreed at a hearing to resolve discovery disputes among themselves without court intervention. However, because the parties could not resolve the issues themselves, the court ordered that certain of Dodson's answers to the defendants' requests for admissions be stricken with additional time to respond to six particular requests. The court ordered that the remainder of the defendants' requests to strike be denied. On Dodson's motion to compel, the trial court found that certain answers by the defendants were adequate, certain requests by Dodson were overly broad, and the court ordered that Allstate respond to certain requests on a limited basis, providing Arkansas materials only.

On December 30, 1998, Dodson filed a motion to reduce time for discovery responses, a motion for reconsideration of the trial court's rulings in its December 14, 1998, order on the motions to compel discovery, and a motion for order setting times and dates for depositions and procedures for authentication of evidence. The defendants responded on January 20, 1999. The defendants also filed a motion for a protective order or, in the alternative, a motion to quash Dodson's second set of interrogatories and requests for production arguing that they had nothing to do with the lawsuit and were merely asked as a "fishing expedition." Dodson responded on February 1, 1999, arguing that the defense had "stonewalled" discovery and had failed to produce any of the ordered discovery. Dodson further argued that the requested discovery was sought to highlight Allstate's continued practice of denying soft-tissue injury claims. In addition to these motions, both parties filed additional motions regarding discovery or lack thereof.

On April 5, 1999, Allstate, Waddell, and Runkle moved to dismiss their counterclaim, and the court granted this motion that same day. A week later, the parties agreed to a joint stipulation that documents contained in thirteen volumes of Allstate company manuals were authentic and comply with the rules for the admissibility of business records in Arkansas. However, the stipulation specifically noted that it remained an issue for the jury as to whether these records were used in the training of local employees.

The defendants filed a motion for summary judgment on April 16, 1999, arguing that Arkansas no longer recognized the tort of defamation per se, and Dodson must show actual damages, which he could not do. Furthermore, the defendants argued that any statements made by Waddell and Runkle that may have been defamatory were privileged, and that they took no improper action to interfere with Dodson's contractual relations. Dodson replied to the motion for summary judgment on April 22, 1999, and included responses, as well, to various other defense motions including a motion in limine and motions to exclude certain witnesses. The trial court denied the defendants' motion for summary judgment on May 7, 1999, reset the trial for September 8, 1999, and ordered that no further pleadings, motions, or amendments would be permitted without leave of court and no additional discovery would be allowed. The court also "froze" the witness lists. On August 12, 1999, however, Dodson filed a second amended complaint restating his claims in the first amended complaint and increasing his claim for damages.

Trial began in this case on September 8, 1999, with jury voir dire. Over the course of the trial, each party presented numerous witnesses who testified regarding alleged representations made by Allstate and its agents, as well as the claims practices of Allstate. The defendants also presented evidence of the alleged lack of proper treatment and care by Dodson and his physical-therapy aides in support of the defense's theory that claims were properly denied becauseof inadequate treatment by Dodson. At the close of trial, prior to instructing the jury, Dodson dismissed his claims against Runkle and Waddell and proceeded only against Allstate. The trial court submitted the claims of defamation and tortious interference with a contractual relationship to the jury, and the jury found for Allstate. On September 24, 1999, the trial court entered its judgment reflecting the jury's decision. Dodson raises ten points on appeal.

I. Judicial and Juror Misconduct

Dodson first argues on appeal that the trial court erred in denying his motion for new trial because there was judicial and juror misconduct which damaged his ability to present a fair case to the jury. This court has said that a decision on whether to grant or deny a motion for new trial lies within the sound discretion of the trial court. State v. Cherry, 341 Ark. 924, 20 S.W.3d 354 (2000); Miller v. State, 328 Ark. 121, 942 S.W.2d 825 (1997). This court will reverse a trial court's order granting a motion for a new trial only if there is a manifest abuse of discretion. Id. A trial court's factual determination on a motion for a new trial will not be reversed unless clearly erroneous. Clayton v. State, 321 Ark. 602, 906 S.W.2d 290 (1995).

A. Judicial Misconduct

Dodson argues that the trial judge was biased and hostile to his claims and that this "ultimately...determined the outcome of this litigation." Dodson argues that the trial judge's rulings on various discovery motions, his statements made during hearings and at trial, the court's denial of jury instructions proffered by Dodson, and the judge's alleged communications with a juror all served to prejudice Dodson.

This argument is not preserved for review, as appellant did not object to any statements by the trial judge, nor did he move for the judge's recusal. See Britt v. State, 334 Ark. 142, 974 S.W.2d 436 (1998). While Dodson cites examples of what he believes are biased or harsh remarks on the part of the trial judge, the abstract is devoid of any objection or motion to recuse. As such, even though this matter was argued in the motion for new trial, it has been abandoned on appeal for failure to preserve the issue in a timely and proper manner. B. Juror Misconduct

Dodson also alleges in his motion for new trial and on appeal that one of the jurors who became the jury foreman engaged in improper ex parte communications with the judge,lied during voir dire about her profession and insurance experience, and demonstrated outward acts of disdain during Dodson's closing arguments.

Jury misconduct is a basis for granting a new trial under Rule 59 (a)(2). See Trimble v. State, 316 Ark. 161, 871 S.W.2d 562 (1994); Hacker v. Hall, 296 Ark. 571, 759 S.W.2d 32 (1988). The decision whether to grant a new trial under Rule 59 (a)(2) is discretionary with the trial judge who will not be reversed absent an abuse of that discretion. Borden v. St. Louis Southwestern Ry.Co., 287 Ark. 316, 698 S.W.2d 795 (...