Independent Ins. Consultants, Inc. v. First State Bank of Springdale, Ark.

• Decision Date: 15 January 1973
• Docket Number: No. 5--6146,5--6146
• Citation: 253 Ark. 779,489 S.W.2d 757
• Parties: INDEPENDENT INSURANCE CONSULTANTS, INC., Appellant, v. FIRST STATE BANK OF SPRINGDALE, Arkansas, Appellee.
• Court: Arkansas Supreme Court

Page 757

489 S.W.2d 757

253 Ark. 779

INDEPENDENT INSURANCE CONSULTANTS, INC., Appellant, v. FIRST STATE BANK OF SPRINGDALE, Arkansas, Appellee.

No. 5--6146.

Supreme Court of Arkansas.

Jan. 15, 1973.

Rehearing Denied Feb. 19, 1973.

Jones & Segers, Fayetteville, for appellant.

Putman, Davis & Bassett, Fayetteville, for appellee.

BYRD, Justice.

This litigation arises out of the conduct of Woody H. Tague an employee of appellant, Independent Insurance Consultants, Inc., immediately prior and subsequent to the death of Dale M. O'Brien. It appears that Dale M. O'Brien was the owner of the Dale M. O'Brien Insurance Agency and in that capacity contracted with Woody H. Tague to assist in the writing of the insurance business. After the employment contract was entered into the appellant was formed with O'Brien owning 60% of the stock and Tague the other 40%. Under this arrangement the insurance was written through the Dale M. O'Brien Insurance Agency but all funds in connection therewith were handled through appellant. The funds were deposited in appellee, First State Bank of Springdale, Arkansas in an account requiring the signatures of both O'Brien and Tague. A day or so before O'Brien's death, Tague wrote a $21,000 check on appellant's account signing both his name and the name of O'Brien and deposited the proceeds into a special account. The Administrator of O'Brien's Estate instituted an action in the chancery court against Tague seeking an injunction to prohibit Tague from writing in his own name the business belonging to the Dale M. O'Brien Insurance Agency and for an accounting. After the action against Tague was transferred to law, appellant intervened seeking to recover the $21,000 which appellee had permitted Tague to withdraw. Appellant thereafter amended its complaint against appellee to allege that appellee had negligently and actively assisted Tague in taking Over the business to the Dale M. O'Brien Insurance Agency and that as a result thereof appellant had suffered damages in the amount of $300,000.

After numerous discovery proceedings appellee filed a motion for summary judgment on the $21,000 count for the reason that the funds had been used to discharge debts lawfully owed by appellant. On March 21, 1972, the trial court granted the motion for summary judgment but in so doing dismissed the intervention. Appellant filed its notice of appeal on April 11, 1972, and on April 12th the trial court corrected its order to show only a partial dismissal of the intervention having to do with the $21,000 item and that the other issues were still pending. For reversal appellant raises numerous points including the issue that the trial court lacked jurisdiction to correct its order after the filing of the notice of appeal. We find the latter issue to be without merit--see Andrews v. Lauener, 229 Ark. 894, 318 S.W.2d 805 (1958).

We do not reach the merits of the other points argued by appellant for lack of a final order. In Renner v. Progressive Life Insurance Co., 191 Ark. 836, 88 S.W.2d 57 (1935) and Security Mortgage Co. v. Bell, 175 Ark. 128, 298 S.W. 865 (1957), we pointed out that an order dismissing a complaint in part and leaving a part which presented a triable issue was not an appealable order.

Appeal dismissed.

GEORGE ROSE SMITH, J., concurs.

FOGLEMAN, J., dissents.

GEORGE ROSE SMITH, Justice (concurring).

I wholly agree with the majority opinion, but I should like to set out other facts to show why the $21,000 claim against the bank if not a separabel issue that can be finally determined without reference to the rest of the litigation.

This is a four-sided lawsuit involving claims and counterclaims asserted by (1) the original plaintiff, O'Brien's administrator, (2) the original defendant, Tague, who was O'Brien's employee and business associate, (3) the appellant-intervenor, IIC, Inc., in whose name O'Brien deposited O'Brien Insurance Agency funds, and (4) the appellee bank, which was the depository for the bank accounts in issue.

The pleadings comprise more than 300 typewritten pages. In the light of the pleadings filed so far (and there will certainly be more), the litigation requires a comprehensive accounting among the four sets of litigants. Their claims and counterclaims are so interwoven that it is impossible to pluck out one thread without affecting the rest of the fabric. Without going into great detail, here is a summary of the major contentions:

(1) O'Brien's administrator, as plaintiff, originally charged Tague with having wrongfully converted to himself the assets and business of the O'Brien Insurance Agency, including $70,830 in premium earnings.

(2) IIC, Inc., owned 60% by O'Brien and 40% by Tague, asserted that the bank conspired with Tague to destroy IIC's business, causing a loss of $250,000. The bank wrongfully allowed Tague to deposit to his own account more than $90,000 belonging to O'Brien and IIC. The bank wrongfully honored a $21,000 IIC check signed only by Tague, although O'Brien's signature was also required. O'Brien's administrator, the original plaintiff, adopted all IIC's pleadings and joined in its prayers for relief against the bank.

(3) Tague filed a general denial and by cross-complaint sought judgment against IIC's majority stockholders for conversion of corporate assets.

(4) The bank filed a general denial and sought judgment over against Tague in the amount of any judgment entered against the bank. The bank admitted that the $21,000 check was not properly signed but asserted that the money was used to pay legitimate IIC obligations. The bank listed 13 checks, totaling $26,855.16, drawn by Tague against the IIC account and asked IIC to admit that the expenditures were proper charges against IIC. IIC responded that none of the checks were used to pay legitimate claims.

At that point in the litigation the bank moved for summary judgment upon that part of IIC's intervention which alleged that the $21,000 check had been wrongfully honored. This appeal is from a summary judgment upon that limited issue.

It seems plain that the summary judgment is not a final appealable order, because most of the litigation is still pending in the trial court. As the majority point out, it was settled by the Renner case and the Bell case that an order dismissing only part of a complaint is not final when other counts remain to be tried. That rule is demonstrably sound, especially as in almost every case the various counts is a complaint are interrelated. It will not do to say that Renner and Bell are distinguishable as having been decided on demurrer. In both cases the plaintiffs stood on their complaints, which were dismissed in part. In that situation the court's order is ordinarily final. Davis v. Receivers St. L.L. & S.F.R.R., 117 Ark. 393, 174 S.W. 1196 (1915); Melton v. St. Louis, I.M. & S. Ry., 99 Ark. 433, 139 S.W. 289 (1911). It was not appealable in Renner and Bell only because other counts remained undisposed of, as in the case at bar.

Furthermore, even if the disposition of a separable cause of action could be regarded as an appealable order, the claim that the bank wrongfully honored a $21,000 check is not separable. It is alleged that the bank conspired with Tague to destroy an insurance business. The disposition of many other checks is involved in the conspiracy; the bank itself lists 13 of them. If the bank can appeal the court's ruling with respect to one of the checks, I see no reason why it cannot take a separate appeal with respect to each one of the 13. These considerations serve simply to emphasize the fact that litigation such as this, involving a comprehensive accounting among several rival litigants, is peculiarly subject to the general rule forbidding piecemeal appeals.

Finally, this claim in not separable for yet another reason. O'Brien's signature was admittedly required upon the check. O'Brien's administrator also seeks judgment against the bank for its action in honoring the check, but the administrator was not involved in the summary judgment and is not a party to this appeal. Consequently, even if we should decide the present appeal on its merits, our decision would be undeniably piecemeal, for the same issues could be brought to us again by O'Brien's administrator after the case has ultimately been tried in the court below upon its merits.

FOGLEMAN, Justice (dissenting).

I agree with the policy and reasoning underlying the requirement of Ark.Stat.Ann. § 27--2101 (Supp.1971) that an order of a trial court be 'final' before it is appealable. Nothing could do more to clog the judicial machinery than piecemeal appeals, unless it is the necessity for new trials of entire cases because of trial court errors that could have been corrected upon an appeal such as this. I respectfully submit that the summary judgment in this case is final and appealable.

In order to explain the basis of my position it is necessary that I point out matters in the record in addition to those recited in the majority opinion. In the original complaint, the plaintiff, O'Brien's administrator, asked that Tague be required to account for $70,830 in premiums converted by Tague, although due appellant. The complaint of appellant, as intervenor, adopted the allegations of plaintiff's complaint and also sought to recover from appellee for payment of a $21,000 check on appellant's account in that bank payable to 'I.I.C. Special Account' in spite of the fact that the check did not bear a required signature--that of Dale O'Brien. Appellant contended that the proceeds of the check were deposited to the account entitled 'I.I.C. Special Account' or in other accounts in the name of W. H. Tague or some deviation of that name on which no signature except that of Tague was required for withdrawals, so that the money from appellant was actually credited to Tague, who benefited from the $21,000, and that this would not have been possible without the bank's having...