Johnson v. Schumacher Grp. of Ark., Inc.

• Court: Arkansas Court of Appeals
• Writing for the Court: ROBERT J. GLADWIN, Judge
• Citation: Johnson v. Schumacher Grp. of Ark., Inc., 2019 Ark. App. 545, 589 S.W.3d 470 (Ark. App. 2019)
• Decision Date: 20 November 2019
• Docket Number: No. CV-18-509,CV-18-509
• Parties: Carroll "Don" JOHNSON, Appellant v. SCHUMACHER GROUP OF ARKANSAS, INC. ; Pope Emergency Group, LLC; and Russellville Holdings, LLC, d/b/a St. Mary's Regional Medical Center, Appellees

2019 Ark. App. 545

589 S.W.3d 470

Carroll "Don" JOHNSON, Appellant

v.SCHUMACHER GROUP OF ARKANSAS, INC. ; Pope Emergency Group, LLC; and Russellville Holdings, LLC, d/b/a St. Mary's Regional Medical Center, Appellees

No. CV-18-509

Court of Appeals of Arkansas, DIVISION I.

Opinion Delivered: November 20, 2019

Sutter & Gillham, P.L.L.C., by: Luther Oneal Sutter, Little Rock; and Baker & Schulze, Little Rock, by: J.G. "Gerry" Schulze, for appellant.

Wright, Lindsey & Jennings LLP, Little Rock, by: Regina A. Young and Gary D. Marts, Jr., for separate appellees Schumacher Group of Arkansas, Inc., and Pope Emergency Group, LLC.

Munson, Rowlett, Moore & Boone, P.A., by: Beverly A. Rowlett, Tim Boone, and Sarah E. Greenwood, Little Rock, for separate appellee Russellville Holdings, LLC, d/b/a St. Mary's Regional Medical Center.

ROBERT J. GLADWIN, Judge

The appellant, Dr. Carroll "Don" Johnson, filed a complaint in the Pope County Circuit Court alleging that appellee Pope Emergency Group (Pope) and its parent company, Schumacher Group of Arkansas (Schumacher), were liable for breach of contract and wrongful termination. Dr. Johnson also sued Russellville Holdings, LLC, which owns and does business as St. Mary's Regional Medical Center (St. Mary's), for tortious interference with the professional-services contract that Dr. Johnson executed with Pope. Pope also filed a counterclaim for breach of contract alleging that Dr. Johnson failed to return a $30,000 signing bonus as required by the terms of the agreement.

Dr. Johnson nonsuited all his claims after each of the appellees filed motions for summary judgment. Pope elected to continue with its breach-of-contract claim, and in a companion case that we also decide today, see Johnson v. Pope Emergency Group , 2019 Ark. App. 544, 589 S.W.3d 462, we affirm the circuit court's order granting summary judgment to Pope.

Dr. Johnson refiled his claims against Pope, Schumacher, and St. Mary's in a separate case, Pope County Circuit Court case No. 58CV-16-538. The circuit court dismissed those claims with prejudice, however, after ruling that the summonses that Dr. Johnson issued with his refiled complaint were fatally defective. Dr. Johnson now challenges that order in this appeal. We affirm.

I. Facts and Procedural History

The facts underlying Dr. Johnson's breach-of-contract, wrongful-termination, and tortious-interference claims are set forth in detail in our opinion in Johnson v. Pope Emergency Group , supra ; consequently, we will not repeat them here. Rather, we resume the story from the point at which Dr. Johnson refiled his claims.

Dr. Johnson refiled his complaint against Pope, Schumacher, and St. Mary's on November 21, 2016. All the defendants were served with summonses that provided, in material part, if each of them "failed to respond within the applicable time period, judgment by default will be entered against [them] for the relief demanded in the complaint." (Emphasis added.) Several months later, Pope, Schumacher, and St. Mary's filed motions to dismiss the complaint because the summonses did not strictly comply with Ark. R. Civ. P. 4(b), which expressly requires summonses to state that judgments by default may —not will —be entered in the event defendants fail to timely respond. They argued that dismissal was mandatory, moreover, because Dr. Johnson failed to seek an extension or serve a corrected summons within 120 days after filing the complaint, as required by Ark. R. Civ. P. 4(i).

While the motions to dismiss were pending, Pope and Schumacher filed a motion for protective order pursuant to Ark. R. Civ. P. 26. The motion alleged that Dr. Johnson had refiled claims that "he voluntarily dismissed in a previous action after the parties had completed discovery, including a deposition of a corporate representative for the Schumacher-Pope defendants." The motion further alleged that Dr. Johnson had "served another [Ark. R. Civ. P] 30(b)(6) deposition notice seeking to depose [the corporate representative] a second time." Therefore, Pope and Schumacher requested that the court issue a protective order "quashing [the] repetitive deposition notice" and "forbidding [Dr. Johnson] from engaging in ... duplicative discovery." Pope and Schumacher also requested that the circuit court "award them their expenses, including attorney's fees, incurred in relation to the motion for protective order[.]"

The circuit court entered an order dismissing Dr. Johnson's refiled claims on February 28, 2018. The court agreed that the summonses failed to strictly comply with Rule 4(b). The circuit court also rejected Dr. Johnson's argument that Pope and Schumacher waived their defense of insufficient process by filing a motion for protective order and seeking attorney's fees, which Dr. Johnson claimed was a request for affirmative relief that ordinarily waives jurisdictional defects. The circuit court dismissed the claims with prejudice , moreover, because Dr. Johnson "voluntarily dismissed these same claims against Schumacher, Pope, and St. Mary's in a previous action filed in this [c]ourt."

Dr. Johnson now appeals the circuit court's order, arguing that the circuit court erred in two respects. First, he asserts that this court has previously refused to require strict compliance with Ark. R. Civ. P. 4(b) when an alternative interpretation would avoid "absurd consequences" and give effect to the rule's purpose. In that vein, Dr. Johnson argues that the defect in the summonses issued in this case, stating that a default judgment will —rather than may —be entered in the event the defendants fail to respond, was a mere grammatical error that did not otherwise prevent the appellants from being apprised of the pendency of the lawsuit or deny them the opportunity to be heard. Second, Dr. Johnson insists that Pope and Schumacher waived their challenge to the sufficiency of the summonses when they sought attorney's fees in connection with their motion for protective order. As he did below, Dr. Johnson asserts that the prayer for attorney's fees was the sort of request for affirmative relief that this court has previously held waives sufficiency of process and other challenges to personal jurisdiction.

II. Standard of Review

"In cases where the appellant claims that the [circuit] court erred in granting a motion to dismiss, appellate courts review the [circuit] court's ruling using a de novo standard of review." Holliman v. Johnson , 2012 Ark. App. 354, at 4, 417 S.W.3d 222, 224. The de novo standard is also applied when the issue presented involves, as it does here, the correct interpretation of an Arkansas court rule. Id.

III. Discussion

A. Defective Summonses

Dr. Johnson first argues that the circuit court erred by ruling that the summonses were fatally defective under Ark. R. Civ. P. 4(b). According to Dr. Johnson, the defect that incorrectly warned the appellants that judgment by default will —as opposed to may —be entered against them was not fatal. It was a mere grammatical error, he says, that did not otherwise prevent the appellants from being notified of the pendency of the lawsuit or deny them the opportunity to be heard. In response, the appellees argue that this court has required strict compliance with the requirements of Rule 4(b), and the rule specifically requires that summonses notify defendants that default judgments may —not will —be entered against them. We believe that the supreme court cases requiring strict compliance with Rule 4(b) warrant affirming the circuit court's order.

"The purpose of [a] summons is to apprise a defendant that a suit is pending against him and afford him an opportunity to be heard." Malloy v. Smith , 2017 Ark. App. 288, at 9, 522 S.W.3d 819, 825. Therefore, "[s]tatutory service requirements, being in derogation of common-law rights, must be strictly construed and compliance with them must be exact in order to give a court jurisdiction over a defendant." Id. "This court has held that the same reasoning applies to service requirements imposed by court rules." Id. "The technical requirements of a summons set out in Ark. R. Civ. P. 4(b) must be construed strictly and compliance with those requirements must be exact." Id. Indeed, "[t]he bright-line standard of strict compliance permits certainty in the law; whereas, a substantial-compliance standard would lead to an ad hoc analysis in each case in order to determine whether the due-process requirements of the Arkansas and [United States] Constitutions have been met." Earls v. Harvest Credit Mgmt. VI-B, LLC , 2015 Ark. 175, at 6, 460 S.W.3d 795, 798 (internal citations omitted).

Rule 4(b) of the Arkansas Rules of Civil Procedure governs the form of summonses and provides as follows:

The summons shall be styled in the name of the court and issued under its seal, dated, and signed by the clerk or a deputy clerk, and directed from the State of Arkansas to the defendant to be served. It shall contain, in its caption, the names of the plaintiff and defendant or, if there are multiple parties, the names of the plaintiff and the defendant listed first in the complaint; the address of the defendant to be served, if known; the name and address of the plaintiff's attorney, if any, otherwise the address of the plaintiff; the time within which these rules require that the defendant to be served must appear, file a responsive pleading or motion, and defend; and notice that the defendant's failure to appear, respond and defend within the time allowed may result in entry of judgment by default against the defendant for the relief demanded in the complaint.

(Emphasis added.) This language "sets forth the items that must be included in a summons, the lack of which render it void under the [strict-]compliance standard." Talley v. Asset Acceptance, LLC , 2011 Ark. App. 757, at 4, 2011 WL 6064975. The rule expressly provides that a defendant shall be notified that a judgment may —not will —be entered against him if the defendant fails to...