Landers v. Jameson

• Decision Date: 04 December 2003
• Docket Number: No. 03-114.,03-114.
• Citation: Landers v. Jameson, 355 Ark. 163, 132 S.W.3d 741 (Ark. 2003)
• Parties: Gil LANDERS, d/b/a Big Daddy's Pawn Shop v. Ken JAMESON.
• Court: Arkansas Supreme Court

132 S.W.3d 741

355 Ark. 163

Gil LANDERS, d/b/a Big Daddy's Pawn Shop v.Ken JAMESON.

No. 03-114.

Supreme Court of Arkansas.

December 4, 2003.

The McHughes Law Firm, by: Josh E. McHughes and Becky A. McHughes, Little Rock, for appellant.

Cross, Gunter, Witherspoon & Galchus, P.C., by: M. Stephen Bingham, Little Rock, for appellee.

Hyden, Miron & Foster, PLLC, by: Lyle D. Foster and Danny W. Broaddrick, Little Rock, for amicus curiae Arkansas Pawnbrokers' Association.

ROBERT L. BROWN, Justice.

This appeal involves the constitutionality of two Arkansas statutes: Ark.Code Ann. §§ 18-27-202 and -203 (1987).AppellantGil Landers d/b/a Big Daddy's Pawn Shop contends that the statutes are unconstitutional, as applied to him, because no notice and no hearing were afforded to him prior to the time that his property interest was impaired.AppelleeKen Jameson, the true owner of the property in question, asserts that the statutes adequately provided due process protection to the Pawn Shop.We disagree in light of Fuentes v. Shevin,407 U.S. 67, 92 S.Ct. 1983, 32 L.Ed.2d 556(1972), and our own case of McCrory v. Johnson,296 Ark. 231, 755 S.W.2d 566(1988).We agree with the Pawn Shop that the statutes are unconstitutional, as applied to it.We reverse and remand for entry of a judgment consistent with this opinion.

The pertinent facts are not in dispute.In June 1998, Jameson noticed that a ring and two bracelets were missing from his home in Little Rock.In July 1998, he reported that the jewelry was missing to the Little Rock Police Department, which located similar bracelets at the Pawn Shop in Little Rock and placed a hold on them so that they could not be sold or released.The Police Department notified Jameson, and he subsequently identified the jewelry as his.On November 5, 1998, Jameson provided the Pawn Shop with a sworn affidavit in which he averred that two bracelets pawned at Appellant's shop had been wrongfully taken from his house.The Pawn Shop refused to return the bracelets, which caused Jameson to file an action in Little Rock Municipal Court(now District Court) on November 10, 1998.

On February 2, 1999, Jameson appeared pro se, and the Pawn Shop appeared with its attorney at the municipal court hearing.Following the hearing, the municipal court issued its judgment on February 5, 1999, in which it found, by a preponderance of the evidence, that the jewelry in the Pawn Shop's possession was owned by Jameson; that the items were pawned by Linda Stewart, an employee of his housekeeper; and that the items were taken from his home without permission.The court ordered that the items be returned to Jameson after the Police Department released its hold.

The Pawn Shop appealed the judgment to Pulaski County Circuit Court.Jameson also filed a demand for attorney's fees and costs with the circuit court.He described the legal history of the case and quoted §§ 18-27-202 and -203(b) in support of his demand.He then urged the court to award costs and attorney's fees incurred at the conclusion of the appeal.The Pawn Shop responded that the statutes in question were unconstitutional and that Jameson was not the true owner.The circuit court entered judgment in favor of the Pawn Shop and found that Jameson had not met his burden of proving by a preponderance of the evidence that the jewelry was his property.Jameson appealed that judgment to the court of appeals.

In February 1999, the Police Department released its hold on the jewelry.On May 24, 2000, the court of appeals held in an unpublished opinion that the circuit court had clearly erred in failing to find that Jameson was the true owner of the jewelry and in not awarding costs and attorney's fees to Jameson.Jameson v. Landers, CA 99-1273, 2000 WL 675652(Ark.App.May 24, 2000)(Landers I).The court of appeals further held that Ms. Stewart was jointly and severally liable for an amount equal to the value of the jewelry at the time of the conversion and reversed the circuit court's judgment and remanded the case to that court.

On June 9, 2000, the Pawn Shop filed a petition for rehearing with the court of appeals and claimed that the two issues of attorney's fees and the constitutionality of the statutes had not been ruled on by the circuit court and, therefore, were not issues on appeal.The Pawn Shop further claimed that the court of appeals' direction to the Pawn Shop to pay Jameson attorney's fees was in effect a ruling on the constitutionality of the statutes and that this denied the Pawn Shop its day in court on that issue.On June 28, 2000, the court of appeals denied the petition without comment.

On May 30, 2000, Jameson filed a confirmation of attorney's fees and costs in circuit court pursuant to § 18-27-203.The circuit court subsequently held a hearing on the attorney's fees issue, and at that hearing, the Pawn Shop again asserted that the statutes were unconstitutional.The circuit court concluded that the court of appeals had implicitly held the statutes to be constitutional by its denial of the petition for rehearing.As a result, the circuit court entered judgment for Jameson and ordered that the bracelets be returned to him, that the Appellant pay $2,773.87 if the bracelets were not returned in the same condition as when they were exhibited at trial, and that the Pawn Shop pay Jameson's costs and attorney's fees in the amount of $13,434.75.

The Pawn Shop appealed, and on April 3, 2002, the court of appeals issued an opinion not designated for publication in which it found that the circuit court's conclusion on remand that the court of appeals had implicitly held the statutes to be constitutional was clearly erroneous.Landers v. Jameson, CA 01-269, 2002 WL 498057(Ark.App.April 3, 2002)(Landers II).Because of this, the court of appeals reversed and remanded the issue of the constitutionality of §§ 18-27-202 and -203 back to the circuit court for determination.The court of appeals expressed no opinion as to the effect of the Pawn Shop's failure to notify the Attorney General that it was raising an issue of the statutes' constitutionality pursuant to Ark.Code Ann. § 16-111-106(1987).The court of appeals did not decide the reasonableness of the attorney's fees, because it concluded that the determination of the fees depended on the outcome of the Pawn Shop's attack on the constitutionality of the statutes.

On April 12, 2002, the Pawn Shop filed a motion to release the supersedeas bond in the amount of $16,000.00 posted by the Pawn Shop pending appeal.Also on that date, the Pawn Shop confirmed to the circuit court that, pursuant to § 16-111-106, it had notified the Attorney General's office of its constitutional challenge to §§ 18-27-203 and -203.Jameson objected to the release of the supersedeas bond and said in his response that "the appeal issue is still unresolved, [Appellant] having filed a Petition for Review by the Arkansas Supreme Court on April 17, 2002."Jameson also stated that the Pawn Shop failed to notify the Attorney General pursuant to § 16-111-106 before the remand and, thus, failed to mount a proper constitutional challenge under Reagan v. City of Piggott,305 Ark. 77, 805 S.W.2d 636(1991).This court denied the Pawn Shop's petition for review.

On June 12, 2002, the Attorney General's office issued a letter that it had reviewed the Pawn Shop's pleadings and said it declined to intervene to defend the constitutionality of the statutes at issue.On July 1, 2002, Jameson moved for summary judgment in circuit court and claimed that the court of appeals remanded this case so that the circuit court could issue a ruling on the Pawn Shop's challenge to the statutes' constitutionality and the Pawn Shop's failure to comply with § 16-111-106.Jameson emphasized that the court of appeals found that the Pawn Shop neither asserted nor preserved its constitutional challenge to the subject statutes in an appropriate manner.He also claimed that the Pawn Shop lacked standing to argue the statutes' constitutionality, because it did not raise the issue until after the parties had been afforded a trial before the municipal court.

On July 2, 2002, the circuit court ordered that the supersedeas bond be released and returned to the Pawn Shop.On July 16, 2002, the Pawn Shop responded to Jameson's motion for summary judgment and urged the circuit court to allow the case to go forward as directed by the court of appeals.The Pawn Shop further requested that it be awarded $500.00 in attorney's fees for its response to Jameson's motion for summary judgment.

On August 27, 2002, the Pawn Shop moved for summary judgment on the grounds that the statutes were unconstitutional.On October 24, 2002, a hearing on the two motions for summary judgment took place.Jameson asserted that the burden was on the Pawn Shop to obtain a ruling relative to the constitutional challenge and that, by failing to comply with § 16-111-106, the Pawn Shop waived that challenge.Jameson also argued that the Pawn Shop lacked standing to challenge the constitutionality of the statutes, because under Ross v. State,347 Ark. 334, 64 S.W.3d 272(2002), the statute is not unconstitutional, as applied to it.He maintained the property belongs to him as found in two court proceedings and that the Pawn Shop received due process, primarily because it did not assert a formal demand until after the municipal court had adjudicated the true ownership of the property.The Pawn Shop argued that the statutes unfairly deprive it of a possessory interest and its lien interest in property without a hearing.It argued further that the attorney's fees were cut off when the bracelets were returned and that the last appeal to the court of appeals and the hearing in circuit court were not subject to attorney's fees.

On October 30, 2002, the circuit court entered its order and made the following findings:

• The Pawn Shop sufficiently complied with § 16-111-106, in...