In re Special Task Force on Practice & Procedure in Civil Cases

• Decision Date: 10 January 2014
• Citation: 2014 Ark. 5
• Parties: IN RE SPECIAL TASK FORCE ON PRACTICE AND PROCEDURE IN CIVIL CASES
• Court: Arkansas Supreme Court

2014 Ark. 5

IN RE SPECIAL TASK FORCE ON PRACTICE AND PROCEDURE IN CIVIL CASES

SUPREME COURT OF ARKANSAS

December 31, 2013

Opinion Delivered January 10, 2014

PER CURIAM

On August 2, 2013, we appointed a Special Task Force on Practice and Procedure in Civil Cases to review and consider changes to court rules pertaining to parties, liability, and damages in civil litigation involving negligence, medical malpractice, and related cases. See In re The Appointment of a Special Task Force on Practice and Procedure in Civil Cases, 2013 Ark. 303 (per curiam). Professor John Watkins of Fayetteville was appointed chair of the task force, and the following officers of the court were appointed to the task force: Representative Mary Broadaway of Paragould, Brian Brooks, Esq., of Greenbrier, Paul Byrd, Esq., of Little Rock, Kevin Crass, Esq., of Little Rock, Jim Julian, Esq., of Little Rock, Senator David Johnson of Little Rock, Troy Price, Esq., of Little Rock, Mike Rainwater, Esq., of Little Rock, and Representative Matthew Shepherd of El Dorado.

The task force has worked diligently since August, and Professor Watkins submitted an interim report to the Chief Justice Hannah on December 31, 2013. At this juncture, thesupreme court extends to Professor Watkins and to all members of the task force its sincere appreciation for their work on this project. We will have more to say about the task force at a later time, and we await the supplemental report that it has promised.

Today we publish for comment the Interim Report of the Special Task Force on Practice and Procedure in Civil Cases, including the recommended rule changes. The court will review the report and the proposed rules, and they will be referred to the Committee on Civil Practice. Then, with the benefit of comments from the bench, bar, and other interested parties, the Committee on Civil Practice, and ultimately the court, will be in a position to act on the recommendations.

Comments should be submitted in writing to Les Steen, Clerk of the Supreme Court, Attention: Task Force, Justice Building, 625 Marshall Street, Little Rock, AR 72201. The comment period shall expire on March 14, 2014.

INTERIM REPORT OF THE SPECIAL TASK FORCE ON PRACTICE AND PROCEDURE IN

CIVIL CASES

In a per curiam order issued August 2, 2013, the Supreme Court established the Task Force to consider problems with and recommend changes in the court-adopted procedural rules that pertain to "parties, liability, and damages in civil litigation involving negligence, medical malpractice, and related cases."

The Task Force held the first of its seven meetings on August 29 and the last on December 30. Its members also exchanged frequent emails, commented on draft proposals, researched particular issues of Arkansas law, and reviewed various reference materials, including rules and statutes from other states, the Restatement (3d) of Torts, and the Uniform Apportionment of Tort Liability Act (October 2000 draft). The Task Force also received input from representatives of interested parties.

Having completed its work on all but one if the issues, the Task Force decided to submit this interim report to the Court, to be followed by a supplemental report on the remaining issue in February.¹

The Task Force's proposals do not appear in an omnibus rule but instead are incorporated within existing rules: Ark. R. Civ. P. 3, 9, 11, 42, 49, and 52, and Ark. R. App. P.-Civ. 8. In addition, the Task Force proposes adoption of a new rule, designated as Ark. R. Civ. P. 11.1. Drafts of these rules, accompanied by explanatory notes, are appended to this report. New material is underlined, while material to be deleted is lined through. This report elaborates on three proposals and discusses two issues that the Task Force concluded do not warrant action by the Court.

I. Allocation of Nonparty Fault

The Task Force devoted more time to allocation of nonparty fault than to any other issue but in the end could not reach consensus. Nevertheless, seven of the nine voting members agreed on the recommendation included in this report.

In brief, the Task Force recommends adding new provisions to three Rules of Civil Procedure: Rule 9(h), Rule 49(c), and Rule 52(a)(2). Rule 9(h) would be the exclusive procedural mechanism for asserting the substantive right to an allocation of nonparty fault under Ark. Code Ann. §§ 16-60-201 & 16-60-202(c), as amended by Act 1116 of 2013. Like similar rules in other states, Rule 9(h) requires a defendant to assert a contribution claim for allocation of nonparty fault in an answer or amended answer.²

This pleading requirement assures notice to all parties and must be met if a nonparty's fault is to be determined by the trier of fact, as provided in proposed Rules 49(c) and 52(a)(2). However, it does not apply to a nonparty whose status stems from a settlement with the plaintiff; by statute, the trier of fact must determine a released joint tortfeasor's "pro rata share of responsibility" for the plaintiff's damages. Ark. Code Ann. § 16-61-204(d).

The proposed additions to Rules 49 and 52 provide that, in actions for personal injury, medical injury, wrongful death, or property damage, the trier of fact must "determine the fault of all persons or entities, including those not made parties, who may have joint liability or several liability" for the alleged harm if: (1) the plaintiff has settled with the nonparty, or the defendant has given the notice required by Rule 9(h), and (2) the defendant has carried its burden of establishing a prima facia case of the nonparty's fault. The italicized language within the quotation is taken from Ark. Code Ann. § 16-61-201 and is intended to be coextensive with the statute.

Under both rules, apportionment of fault to a nonparty is to be used only for determining the percentage of fault of the parties, and a finding of fault can neither subject a nonparty to liability in any action nor be introduced as evidence of liability in any action. These provisions are based on Section 2 of Act 649 of 2003, the Civil Justice Reform Act. Section 2, codified at Ark. Code Ann. § 16-55-202, was invalidated on separation-of-powers grounds in Johnson v. Rockwell Automation, Inc., 2009 Ark. 241, 308 S.W.3d 135 (2009).

The two Task Force members who voted against the adoption of the proposed rules argued that apportionment of fault to a nonparty who has not settled is unconstitutional unless that person or entity is made a party. For this proposition, they relied on Billings v. Aeropres Corp., 522 F. Supp.2d 1121 (E.D. Ark. 2007).

In Billings, Judge Wilson held, under strict-scrutiny review, that apportioning fault to an immune nonparty employer "will compromise the truth-determining function of a trial" and offend the plaintiff's fundamental right to a fair trial. "Allowing a jury to make specific findings concerning the conduct of an entity or person who is not in the courtroom undermines the purpose of the adversarial process." Id. at 1131 (emphasis added). To avoid this due process problem, as well as a separation-of-powers problem under state law, Judge Wilson concluded that Ark. Code Ann. § 16-55-202 must be "read to apply to persons or entities that can be joined in the action, by either a cross claim or by a third-party claim." Id.

Judge Moody rejected this conclusion in Bohannon v. Johnson Food Equipment, Inc., 2008 WL 2685719 (E.D. Ark. 2008), but agreed that "the fundamental truth-determining function necessary for a fair trial" must be safeguarded. Id. at *2. "Under [Ark. Code Ann. § 16-55-202], a designated non-party is not subject to any liability for its fault, making the filing and service of a third party complaint unnecessary," he wrote. "Federal and Arkansas Rules of Civil Procedure allow discovery from non-parties, and this provides sufficient protection for plaintiffs to assure . . . a fair trial so as to comport with the United States Constitution." Id.

The Task Force has not conducted extensive research but is unaware of any appellate courts that have addressed the "adversarial process" point raised by Judge Wilson in the Billings case.³ Most of these courts have employed the rational basis standard of review and held that apportioning fault to nonparties does not violate substantive due process.⁴

The dissenting members also argued that the proposed allocation rules went beyond the legislative intent of Act 1116, which they said the General Assembly enacted to address only settling defendants. This interpretation, they noted, would avoid the constitutional problem raised in Billings. The majority, however, decided that there was no reliable method of ascertaining legislative intent and choose instead to propose rules that closely track the text of the Act itself.

Likewise, the majority rejected a second proposal that would have limited the allocation rules to a nonparty who is subject to personal jurisdiction in the state and is neither immune from suit nor an employer or co-employee of the plaintiff under the Workers' Compensation Law. Act 1116 amended Ark. Code Ann. § 16-61-202 to provide a right to "an allocation of fault." The fact that a person or entity is beyond the court's jurisdiction or enjoys immunity from suit does not mean that a person or entity is not at fault; rather, it means that the person or entity cannot be sued. Ocasio v. Federal Exp. Corp., 33 A.3d 1139, 1147 (N.H. 2011).

The dissenting members asked that their position be included in this report so it would be clear that the Task Force did not address the constitutional issues mentioned above. Those questions are ultimately for this Court.

II. Rule 11 and Rule 11.1

Section 21 of Act 649, codified at Ark. Code Ann. § 16-114-209, provides that a party who files an action for medical injury "without reasonable cause," or the attorney who signed the complaint, "shall thereafter, as determined by the court, be subject to . . . [t]he payment of reasonable costs, including attorney's fees, incurred by...