McCoy Farms, Inc. v. J & M McKee, 77-201

• Decision Date: 06 March 1978
• Docket Number: No. 77-201,77-201
• Citation: 263 Ark. 20,563 S.W.2d 409
• Court: Arkansas Supreme Court
• Parties: McCOY FARMS, INC., et al., Appellants, v. J & M McKEE et al., Appellees.

Page 409

563 S.W.2d 409

263 Ark. 20

McCOY FARMS, INC., et al., Appellants, v. J & M McKEE et al., Appellees.

No. 77-201.

Supreme Court of Arkansas, In Banc.

March 6, 1978.

Rehearing Denied April 17, 1978.

Freeland & Gafford, Oxford, Miss., Gaughan, Barnes, Roberts, Harrell & Laney, Camden, Wright, Lindsey & Jennings, Little Rock, for appellants.

Brown, Compton & Prewett, Ltd., El Dorado, for appellees.

FOGLEMAN, Justice.

This appeal was taken from a decree foreclosing a purchase money mortgage on farmlands which had been conveyed by appellees to appellants. The mortgage secured the payment of a promissory note dated February 1, 1976, executed by appellants for $539,200 with interest at 8 1/2% Per annum, payable on February 1, 1977. Appellants defended the mortgage foreclosure action on the ground that the note was usurious. It was the contention of appellants that this note was usurious because it was actually executed on August 30, 1976, but backdated to February 1, 1976. The court rejected this contention. We find no reversible error on trial de novo and affirm.

At the outset, we dispose of one of appellants' points for reversal by sustaining their contention that the chancellor erred in excluding documents and testimony offered by them to show the facts and circumstances relating to the note and mortgage and their execution. Such evidence is admissible on the issue of usury. American Physicians Insurance Co. v. Hruska, 244 Ark. 1176, 428 S.W.2d 622; Textron v. Whitener, 249 Ark. 57, 458 S.W.2d 367. It was error to exclude this evidence and we consider all such proffered evidence on trial de novo. Price v. Price, 258 Ark. 363, 527 S.W.2d 322.

We also find that the chancellor erred in excluding appellants' Arkansas attorney from the courtroom on motion of appellees' attorney when the latter stated that he might find it necessary to call appellants' attorney as a witness. Neither our statutes on sequestration of witnesses nor the Code of Professional Conduct requires this, when an attorney is called as a witness by, and testifies on behalf of, an adverse party.

Rule 615 of the Arkansas Uniform Rules of Evidence was in effect at the time of the trial. It requires that the court order witnesses excluded at the request of a party. Ark.Stat.Ann. § 28-1001 (Supp.1977). But it does not authorize exclusion of a person shown by a party to be essential to the presentation of his cause. A party's only lawyer would certainly fall into the category of those who are not to be excluded. This would require the court to determine the question of essentiality of the presence of a potential witness to the presentation of a party's case and that question would arise when a party is represented by more than one attorney. The trial judge in such cases must have some latitude of discretion, which would be narrowed under circumstances prevailing here, i. e., when the witness to be excluded is the party's only Arkansas attorney in a case in a court of this state.

In adopting the Uniform Rules of Evidence, the General Assembly did not specifically repeal Ark.Stat.Ann. § 28-702 (Repl.1962) governing sequestration of witnesses, although there was a specific repeal of the very next section. § 2, Act 1143 of 1975. The adopting act did contain a general repealer. In our view of this case, however, it is not necessary that we decide whether there is an irreconcilable conflict in the two statutes.

The earlier statute (Ark.Stat.Ann. § 28-702 (Repl.1962)) only applied to sequestration (or segregation) of witnesses of the party adverse to the party requesting exclusion. Appellants assured the court that they had no intention of calling this attorney as a witness. Still, the request was made by appellees and the chancellor was persuaded to honor it. The application of the rule of sequestration under this statute to any witness was, at the most, discretionary with the court. St. Louis, I. M. & S. Ry. Co. v. Pate, 90 Ark. 135, 118 S.W. 260 (1909); Southern Anthracite Coal Co. v. Bowen, 93 Ark. 140, 124 S.W. 1048. See also, Copeland v. State, 226 Ark. 198, 289 S.W.2d 524; Benson v. State, 149 Ark. 633, 233 S.W. 758. The trial court had discretion in determining which witnesses may be put under the rule and which ones, if any, may be excused from the rule. Arkansas Motor Coaches v. Williams, 196 Ark. 48, 116 S.W.2d 585; Home Mutual Fire Ins. Co. v. Riley, 252 Ark. 750, 480 S.W.2d 957.

The rule against the attorney who becomes a witness continuing as an advocate was not designed to permit a lawyer to call opposing counsel as a witness and thereby disqualify him. See Code of Professional Responsibility, DR 5-102(B). Galarowicz v. Ward, 119 Utah 611, 230 P.2d 576 (1951); Phillips v. Liberty Mutual Ins. Co., 43 Del.Ch. 436, 235 A.2d 835 (1967); Beavers v. Conner, 258 So.2d 330 (Fla.App.1972). The language of Jones v. Hardesty, 261 Ark. 716, 551 S.W.2d 543, relied upon by appellees to justify the action taken, does not support their position. It is true that the attorney there testifying had been called to the witness stand by adverse counsel, but the cause for this court's concern was the fact that the testifying attorney thereafter cast himself in the role of witness for his own client.

We have held that it was within the trial court's discretion to permit an attorney for a party to testify in a case, even though the rule has been invoked. Arkansas Motor Coaches v. Williams, supra; Oakes v. State, 135 Ark. 221, 205 S.W. 305. But we have not hesitated to reverse a judgment for abuse of that discretion. Rushton v. First National Bank of Magnolia, 244 Ark. 503, 426 S.W.2d 378. A judgment will not be reversed, however, because of the court's action with reference to exclusion of witnesses, in the absence of an abuse of discretion. Mikel v. State, 182 Ark. 924, 33 S.W.2d 397.

We are admonished by statute that no judgment shall be reversed or affected by any error or defect in the proceedings which does not affect the rights of the adverse party. Ark.Stat.Ann. § 27-1160 (Supp.1977). In any event, we should not reverse the action of the trial court in the exercise of discretion in a matter of practice and procedure, when there has been no prejudice to the complaining party in the ultimate result. Naler v. Ballew, 81 Ark. 328, 99 S.W. 72; Kansas City Southern Ry. Co. v. Murphy, 74 Ark. 256, 85 S.W. 428; St. Louis, I. M. & S. Ry. Co. v. Boback, 71 Ark. 427, 75 S.W. 473; St. Louis I. M. & S. Ry. Co. v. Devaney, 98 Ark. 83, 135 S.W 802; Railway Co. v. Sweet, 57 Ark. 287, 21 S.W. 587. See also, State v. Jennings, 10 Ark. 428; Globe Life Ins. Co. v. Humphries, 258 Ark. 118, 522 S.W.2d 669; Bates v. Simmons, 259 Ark. 657, 536 S.W.2d 292; Parker v. Wells, 84 Ark. 172, 105 S.W. 75; Kelly v. DeWees, 200 Ark. 770, 140 S.W.2d 1011. Error unaccompanied by prejudice, commonly called harmless error, is not ground for reversal. Keathley v. Yates, 232 Ark. 473, 338 S.W.2d 335; Christmas v. Raley, 260 Ark. 150, 539 S.W.2d 405; Railway Co. v. Sweet, supra. The harmless error rule applies even when the error is of constitutional proportions. Chapman v. California, 386 U.S. 18, 87 S.Ct. 824, 17 L.Ed.2d 705, 24 A.L.R.3d 1065 (1967), reh. den. 386 U.S. 987, 87 S.Ct. 1283, 18 L.Ed.2d 241; Gilbert v. California, 388 U.S. 263, 87 S.Ct. 1951, 18 L.Ed.2d 1178 (1967).

We do not see how appellants have been prejudiced by the exclusion of its only Arkansas attorney from the proceedings. The facts seem to be undisputed. The legal question seems to have been adequately presented. It has been presented here on trial de novo and the law firm of the excluded attorney has apparently participated in appellants' brief, as its name appears thereon. Yet no attempt was made to have a review or rehearing in the trial court with the participation of Arkansas counsel or to offer evidence that had not been offered at the trial or to present any legal argument that might have, but had not, been made. We find no prejudice to appellants by the exclusion of their Arkansas attorney on the possibility that he might be called as a witness by appellees.

Although we might say that there was an abuse of the trial court's discretion in denying appellants' motion for a continuance to obtain other Arkansas counsel, if there had been any showing that prejudice resulted, in the absence of any such showing, there is no ground for reversal. Mammoth Spring School District No. 2 v. Fairview School District No. 7, 190 Ark. 769, 80 S.W.2d 615; Missouri Pac. R. Co. v. Berry, 191 Ark. 1165, 83 S.W.2d 531; Missouri & N. A. R. Co. v. Robinson, 188 Ark. 334, 65 S.W.2d 546; Barrett v. Berryman, 127 Ark. 609, 193 S.W. 95. Even when there is a clear abuse of discretion in the denial of a motion for continuance, the error is not reversible unless there is a showing of prejudice. Finch v. State, 262 Ark. 313 (1977), 556 S.W.2d 434. Even though a motion for new trial is not required, as a prerequisite to appellate review, it is still a procedure available for showing prejudice in a ruling of the trial court when it was not possible to make that showing at the time of the ruling. Finch v. State, supra. Even though it is doubtful that, strictly speaking, a motion for new trial is appropriate in a chancery case, a bill of review or petition for rehearing can serve the same purpose in chancery. Midwest Lime Co. v. Independence County Chancery Court, 261 Ark. 695, 551 S.W.2d 537. If there had been any prejudice to appellants in exclusion of their Arkansas attorney from the proceedings, it might have been shown, or at least alleged, in a bill of review or petition for rehearing.

Where the decision and judgment is correct on the undisputed evidence, the appellant is in no position to complain. Yutterman v. Grier, 112 Ark. 366, 166 S.W. 749. Since, as we view the matter, the procedural error, granted that there was an abuse of discretion in the matter, did not and could not have affected the correct result...