Weathersbee v. Wallace

• Decision Date: 20 March 1985
• Docket Number: No. CA,CA
• Citation: 686 S.W.2d 447,14 Ark.App. 174
• Parties: Norma Louise WEATHERSBEE, Appellant, v. James R. WALLACE, Special Administrator of the Estate of Malvin L. Hagler, Deceased, Appellee. 84-333
• Court: Arkansas Court of Appeals

Page 447

686 S.W.2d 447

14 Ark.App. 174

Norma Louise WEATHERSBEE, Appellant, v. James R. WALLACE, Special Administrator of the Estate of

Malvin L. Hagler, Deceased, Appellee.

No. CA 84-333.

Court of Appeals of Arkansas,

Division II

March 20, 1985.

Rehearing Denied May 1, 1985.

Homer Tanner, North Little Rock, for appellant.

Harold W. Madden, North Little Rock, for appellee.

COOPER, Judge.

This case involves the ownership of certain funds which originally were the property of Malvin L. and Norma M. Hagler. These funds were placed in certificates of deposit which were to mature on October 13, 1982. Both certificates, aggregating $20,000.00, were issued in the names of Mr. and Mrs. Hagler. Both the Haglers were hospitalized prior to the maturity date, and Mrs. Hagler made plans to move to Florida with her daughter (Mr. Hagler's stepdaughter) so that her daughter, the appellant herein, could care for her. Mrs. Hagler apparently intended that the funds would be used to meet her needs if she moved to Florida.

The appellant attempted to redeem the certificates prior to their maturity date, but the bank refused, since she was not on the signature card. She subsequently obtained the signature cards and the Haglers signed them, authorizing the addition of the appellant's name as a payee on the certificates. The appellant then redeemed the certificates and deposited the funds in another bank in a joint checking account in her name and that of Mrs. Hagler, omitting Mr. Hagler as a payee. Mrs. Hagler died approximately six weeks after the appellant established the new account, never having been able to move to Florida.

When Mr. Hagler discovered that the certificates had been redeemed and the funds transferred, he filed suit seeking to enjoin the bank from paying the funds over to the appellant, and further seeking to restrain the appellant from attempting to withdraw the funds. The chancellor issued a temporary restraining order, and the matter proceeded to trial. The chancellor found that the appellant was authorized to renew the certificates; that the appellant, without Mr. Hagler's permission, withdrew the funds, redepositing them in an account which omitted him; that the funds withdrawn were for the upkeep and maintenance of Mrs. Hagler, if she moved to Florida; that Mrs. Hagler did not move to Florida; and that the funds in question were the sole property of Mr. Hagler. (Mr. Hagler has since died, and this appeal was revived in the name of his administrator). From that decision, comes this appeal.

On appeal, the appellant first argues that the chancery court was without jurisdiction. The appellant raised this issue before the trial court, arguing, as she does here, that this suit is one for conversion, and not cognizable in equity. We disagree. Where the chancellor properly assumed jurisdiction to entertain a request for equitable relief, jurisdiction may be retained to adjudicate the legal issues involved. Import Motors, Inc. v. Luker, 268 Ark. 1045, 599 S.W.2d 398 (1980). Regardless of whether the appellee was entitled to bring an action at law for conversion, the mere existence of that right does not deprive the equity court of jurisdiction unless the legal remedy is clear, adequate, and complete. Spears v. Rich, 241 Ark. 15, 405 S.W.2d 929 (1966); McGehee v. Mid South Gas Co., 235 Ark. 50, 357 S.W.2d 282 (1962). Here, we cannot say that the chancellor erred in retaining jurisdiction.

Next, the appellant argues that the chancellor erred in granting the preliminary injunction while the case was pending. We disagree. We find no error or abuse of discretion in the issuance of the preliminary injunction which served to preserve the status quo until the ownership of the funds was established after trial, nor do we find that the chancellor erred in failing to require a bond as a prerequisite to the issuance of the injunction. As the appellant points out, the purpose of a bond is to indemnify the parties enjoined against damages occasioned by the wrongful issuance of the injunction. Rule 65(d) of the Arkansas Rules of Civil Procedure states, in part, that "[a]s a condition precedent to the issuance of a preliminary injunction or temporary restraining order, the Court may require the giving of security" in the amount deemed appropriate by the Court. Since no party enjoined has alleged, either at trial or before this Court, damages occasioned by the issuance of the injunction, we find no error in the chancellor's determination that a bond was not required.

Next, the appellant argues that the trial court should not have allowed a witness to testify. Judge Joel C. Cole was initially Mr. Hagler's attorney, and, after the initial hearing on the matter, prior to the issuance of the preliminary injunction, Judge Cole informed the court that he would withdraw from the case, because it had become apparent that he would have to testify. The appellant objected, alleging that since a major part of the case had been developed, it would be improper for Judge Cole to testify. Judge Cole responded that, because of statements made by the appellant, he would have to testify. We do not find that the chancellor erred in refusing to bar Judge Cole's testimony. The Arkansas Code of Professional Responsibility, 33 Ark.L.Rev. 605 (1980), adopted by the Arkansas Supreme Court in a Per Curiam, 260 Ark. 910 (June 21, 1976), provides in Disciplinary Rule 5-102 that where an attorney determines that it will be necessary that he testify, he must withdraw from the...