Smith v. Sidney Moncrief Pontiac, Buick Gmc

• Decision Date: 19 June 2003
• Docket Number: No. 02-449.,02-449.
• Citation: 120 S.W.3d 525,353 Ark. 701
• Parties: JoLynn SMITH v. SIDNEY MONCRIEF PONTIAC, BUICK, GMC COMPANY, d/b/a Sherwood Pontiac, Buick, GMC Company.
• Court: Arkansas Supreme Court

120 S.W.3d 525

JoLynn SMITH v. SIDNEY MONCRIEF PONTIAC, BUICK, GMC COMPANY, d/b/a Sherwood Pontiac, Buick, GMC Company.

No. 02-449.

Supreme Court of Arkansas.

June 19, 2003.

Crockett Law Firm, by Michael A. Crockett; and Boyd Law Firm, by Ken Swindle, Little Rock, for appellant.

Hicks Law Firm, by Rickey H. Hicks, Little Rock, for appellee Sidney Moncrief Pontiac, Buick, GMC Company.

Rose Law Firm, by David L. Williams and John D. Coulter, Little Rock, for appellee Sherwood Pontiac, Buick, GMC Company.

ANNABELLE CLINTON IMBER, Justice.

This case involves the construction and interpretation of the Arkansas Rules of Civil Procedure. The underlying facts are not at issue. Appellant JoLynn Smith (Smith) purchased a used car from Appellee Sidney Moncrief Pontiac Buick GMC Company (Moncrief) in October of 1996. Smith subsequently learned that the vehicle had been in an accident two years earlier, that it was declared a total loss by an insurance company, and that as a result, a salvaged title had been issued. Upon learning this information, Smith filed a complaint against Moncrief and two of its employees, Gene Curry and Jerry Cook, alleging fraud and a breach of contract.

Moncrief answered the complaint, and Smith eventually took a voluntary nonsuit resulting in a dismissal without prejudice. Within one year of the nonsuit, Smith filed a new complaint making substantially the same allegations as the first complaint. Smith served Moncrief; but upon learning that Moncrief had been "sold and subsequently incorporated as Sherwood Pontiac, Buick, GMC Company," she amended her complaint to reflect Sidney Moncrief Pontiac Buick, GMC, Company d/b/a Sherwood Pontiac, Buick, GMC, Company (Sherwood) as a defendant. Smith then proceeded with service of process on Sherwood.

Neither Moncrief nor Sherwood answered the amended complaint, and the circuit court granted Smith's motion for default, but reserved the issue of damages. Shortly thereafter, a jury trial was held to determine damages, and the jury returned a verdict assessing compensatory damages at $20,000 and punitive damages at $300,000. The circuit court entered judgment against Moncrief and Sherwood, jointly and severally. Subsequently, Moncrief and Sherwood moved to have the default judgment set aside because of certain errors in the summonses. The circuit court set aside the default, at which point Moncrief and Sherwood moved to have the case dismissed based on the same errors in the summonses. The court held a hearing and granted the motions to dismiss with prejudice. It is from that order that Smith appeals, essentially arguing that the circuit court erred in dismissing her amended complaint with prejudice.

The relevant dates in this case are as follows:

                   I. October 24, 1996  Smith purchased used car from Moncrief
                  II. July 2, 1997      Complaint filed against Moncrief alleging fraud and breach of
                                        contract
                 III. March 8, 1999     Order of dismissal without prejudice entered
                  IV. March 3, 2000     Complaint refiled against Moncrief
                   V. May 4, 2000       Moncrief's designated agent for service of process (Prentice
                                        Hall Corp.) served (summons incorrectly identified defendant
                                        and misstated deadline for defendant to respond)
                  VI. May 19, 2000      Amended complaint filed that added Sherwood as a defendant
                 VII. May 27, 2000      Sherwood's designated agent for service of process (The
                                        Corporation Company) served (summons incorrectly identified
                                        defendant and misstated deadline for defendant to respond)
                VIII. February 20,      Order entered granting Smith's motion for default (issue of
                2001                    damages reserved)
                  IX. August 17, 2001   Default judgment entered
                

                   X. August 30, 2001   Motion to set aside default judgment filed by Moncrief
                  XI. August 31, 2001   Motion for new trial, or, in the alternative, motion for remittitur
                                        filed by Sherwood
                 XII. October 5, 2001   Entry of order setting aside default judgment
                XIII. October 31, 2001  Motion to dismiss filed by Sherwood
                 XIV. November 2, 2001  Motion to dismiss filed by Moncrief
                  XV. November 15, 2001  Motion to extend time for service filed by Smith
                 XVI. January 31, 2002  Order entered dismissing Smith's amended complaint with
                                        prejudice
                

I. Arkansas Rule of Civil Procedure 4(i)

Smith's first point on appeal is that the circuit court erred in finding that she did not comply with the requirements of Arkansas Rule of Civil Procedure 4(i) (2003). Under this point, Smith attacks the circuit court's dismissal of her complaint on four separate grounds.

Smith first asserts that service of a flawed summons commences an action and tolls the statute of limitations. Smith admits that the summonses issued in this case were deficient in that "the summonses left off part of appellees's names and misstated the time in which appellees were required to answer."¹ Nonetheless, she contends that in completing service of the flawed summonses within 120 days from the date of filing the complaint, as required by Ark. R. Civ. P. 4(i), she commenced the action for limitation purposes so as to afford her the benefit of the one-year savings provision provided in Ark. Code Ann. § 16-56-126 (1987).

As a threshold matter, both Sherwood and Moncrief suggest that Smith's savings-statute argument is not properly before this court because she failed to make the argument below and the circuit court failed to rule on it. We disagree. In Smith's motion to extend time for service, she states "the time for service is extended by one year after there has been an arrest of judgment or writ of error and remand for another trial. Ark.Code Ann. 16-56-126." In any event, the circuit court ruled that Smith's claims were time-barred, thereby effectively ruling on the application of the savings statute. Thus, the issue is properly preserved for appellate review.

We start with our rules of civil procedure, which provide a basis for dismissal in this case. Pursuant to Rule 12 of the Arkansas Rules of Civil Procedure, certain defenses shall be asserted in the first responsive pleading, or by motion before pleading, including the defenses of insufficiency of process or insufficiency of service of process. See Ark. R. Civ. P. 12(b)(4),(5) (2003). Under Ark. R. Civ. P. 4(a), the clerk must issue a summons upon the filing of a complaint, and Rule 4(b) mandates the form of the summons:

Form. The summons shall be styled in the name of the court and shall de dated and signed by the clerk; under the seal of the court; contain the names of the parties; be directed to the defendant; state the name of the plaintiff; and the time within which these rules require the defendant to appear, file a pleading, and defend and shall notify him that in the case of his failure to do so, judgment by default may be entered against him for the relief demanded in the complaint.

Ark. R. Civ. P. 4(b) (2003). Rule 4 also designates the persons who are authorized to serve process and provides how service of process shall be made. Ark. R. Civ. P. 4(c),(d),(e), and (f) (2003).

Arkansas law is long settled that service of valid process is necessary to give a court jurisdiction over a defendant. Raymond v. Raymond, 343 Ark. 480, 36 S.W.3d 733 (2001) (citing Tucker v. Johnson, 275 Ark. 61, 628 S.W.2d 281 (1982)). Our case law is equally well-settled that statutory service requirements, being in derogation of common-law rights, must be strictly construed and compliance with them must be exact. Id.; Carruth v. Design Interiors, Inc., 324 Ark. 373, 921 S.W.2d 944 (1996) (citing Wilburn v. Keenan Companies, Inc., 298 Ark. 461, 768 S.W.2d 531 (1989) and Edmonson v. Farris, 263 Ark. 505, 565 S.W.2d 617 (1978)). This court has held that the same reasoning applies to service requirements imposed by court rules. Carruth v. Design Interiors, Inc., supra; Wilburn v. Keenan Companies, Inc., supra. More particularly, 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. Thompson v. Potlatch Corp., 326 Ark. 244, 930 S.W.2d 355 (1996) (citing Carruth v. Design Interiors, Inc., supra, which held that the motion to dismiss for failure of service of process should have been granted where the summons was not signed by the clerk as required by Rule 4(b)).

Pursuant to Rule 4(i) of the Arkansas Rules of Civil Procedure, it is also mandatory for the trial court to dismiss the action without prejudice if service is not made within 120 days of filing the complaint and no motion to extend is timely made. Ark. R. Civ. P. 4(i) (2003); Lyons v. Forrest City Machine Works, Inc., 301 Ark. 559, 785 S.W.2d 220 (1990) (Lyons I) (holding service of process not proper under rule 4(d)(5) and dismissal mandatory under Rule 4(i) where summons addressed to F.C. Machine Works and return showed that F.C. Machine works was served as "the person named therein as defendant."); see also Raymond v. Raymond, supra; Cole v. First Nat'l Bank of Ft. Smith, 304 Ark. 26, 800 S.W.2d 412 (1990); Lawson v. Edmondson, 302 Ark. 46, 786 S.W.2d 823 (1990).

Here, Smith does not dispute that the summonses were deficient under Rule 4(b). As stated earlier, neither summons identified the defendant correctly, and both summonses misstated the time in which the defendants were required to respond. See Carruth v. Design Interiors, Inc., supra. Because the service requirements imposed by our court rules must be strictly construed and compliance with them must be exact, we conclude that the circuit court properly dismissed Smith's complaint for failure of service of valid process under Rule 12(b). Furthermore, the circuit court's dismissal of this case was mandatory under the plain language of Rule 4(i) and our case law interpreting that rule because service of...