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PUBLISHER Arkallso.s Bar Associatioll Phone: (501) 375-4606 Fax: (501) 375-4901 Homepage: www.arkbar.rom E-Mail: pjones@arkbar.com EDITOR Pat JOlles GRAPH.IC DESIGN Sara Lmldis EOITORlAL BOARD Stuart P. Miller, Chair Wiley A. Branton Morton Gitelman James c. Graves J. Leon Holmes Jacqueline Johnston/Cravens Lucinda McDaniel David H. Williams Jacqueline S. Wright

OFFICERS President Sandra Cherry President-Elect Murray Claycomb

on en s VOLUME 36, NUMBER 4

Features New Rules in Changing Times

4 Amendment 80's District Courr Let's Make it "Cricket" This Time, Parr I

by Judge Vic Fleming

Immooiate Past President Ron D. Harrison

13

Secretary -Treasurer William A. Martin Parliamentarian Jeannette Denham

Arkansas Attorney Discipline Update, by Stark Ligon

Bomd of Governors Chair David Vandergriff

17

Young Lawyers Section Chair Tim Cullen Executive Director Don Hollingsworth Associate Executive Director Judith Gray BOARD OF GOVERNORS Judge Wlley Branton, Jr. F. Thomas Curry Thomas A. Daily Elizabeth Danielson Kay West Forrest Lance B. Gamer Dave Wisdom Harrod Robert "Skip" Henry Gwendolyn Hodge Jill Jacoway Philip E. Kaplan Edwin N. McClure Lance R. Miller Marie-Bernarde Miller James M. Simpson, Jr. James D. Sprott Danny Thrailkill Teresa Wineland Robert E. Young LIAISON MEMBERS Tom Overbey Judge James 1-1. Gunter, Jr. Carolyn B. Witherspoon Wlliiam Wright

Bankruptcy Reform Legislation The Good, the Bad and the Unknown

by Linda Reid

23 Teaching Old Dogs New Tricks: The 2000 Amendments to the Federal Rules of Civil Procedure

by Troy A. Price and Charles L. Schlumberger

29 A Stitch in Time: Secured Lending Under Revised Article 9

by W Christopher Barrier '~

..

*

Tht ArkanSllS Lawyer (USPS.)46.{).1()) is publishcd quarterly by the Arkansas Bar Association. I'eriodicals postage paid at Little

Rock. Arkansas.

POSTMASTER: .send address

changes to TIr,. ArkallSlls U1wyff,400 West Markham. Uttle Rock. ArkallSa5 72201. Subscription price to non-members of the Arkansas Bar Association $25.00 per year. Any opinion expressed herein is that of the author, ilnd not necessarily that of the Arkansas Bar Association or The A,kllnsus Lawyrr. Contributions to TIll A,kll"sllS ÂŁ.Qwy" a~ ....ekorne and should be sent in two copies 10 EDnoR. TIrl ArLtnSQS I..IIwyrr, 400 West Markham" Little Rock. Arkansas 722tJ1. All inquiries regarding advertising should be sent 10 Editor, n,l ArkllllSIlS LaWYlr ilt the above address. Copyright 2001. Arkansas Bar Association. All rights reserved.

Contents Continued on Page 2

Contents VOLUME 36,

UMBER 4

In This Issue 38

3

President's Reporr, by Sandra Wilson Cherry

In re: Technology Digital Discovery Grab Bag

\5

by Kate Marquess

Eliminating Barriers to Justice in Arkansas: Legal Services Reorganization

40

by Nate Coulter

Significanr Decisions of the Supreme Court of Arkansas by L. Scott Stafford

2\ YLS Section Report, by Tim Cullen

4\

34

Judicial Advisory Opinions

CLE Calendar

42 Lawyer Disciplinary Actions

36 Inadvertent Disclosure of Privileged or Work Product Marerial by David H. Williams

54 In Memoriam

56 Classified Advertisingllndex

to

Advertisers

ARKANSAS BAR ASSOCIATION 400 IV. Markham litlJe Rock, Arkansas 72201 HOUSE OF DELEGATES De~gatl!!: District I-Sf: Ray Allen Goodwin Delegate District 2-SE: Mark R. Johnson, Katharine . Wilson Delegate District 3-SE: Michad E. Mullally. Paul D. Wadddl, Dtnnis Zoplcr Delegate District 4-5E: Bill E. Bracq. Jr. Delegate District 5-5E: James Bradley Delegate District 6-Sf: Chris Morl«lge Delegate District 7-SE: Donald E. Ktt Delegate District 8-SE: H0W2rd L Marrin Delegate District 9-5E: James 1'21 Aowt:rt Delegate District 10-SE: William IGrby Moust:r. David Sinu Delegate District II-SE: Paul W. Kdth Delegate District 12-SE: James Hamihon Delegate District Il-SE: Sln'c R. Crane. Brian H. R'l.Ic1iff. Robin Carroll Delegate District 14-5E: Frank A. Poff, Christie Adams Delegate District IS-Sf: Barry D. ~r, Todd M. Turner Delegate District 16-SE: Ronald D. Kdsay,John T. Vines Delegate District 17-SE: Jam~ J2ockson

Delegate District I-NW: Edwin N. McCJure, Glenn E.. Kelley, Hardy W. Croxton, Jr., George R. Spe:na Delegate District 2-NW: Ern~( 8. Gue. Soya R. Davis.. April M. R~. Shannon L nnt. R:aymond L Niblock. Ste\·en S. Uga.. lim Snively, Mm Durrett. Chris Rttd Delegate District ]·NW: Niki Cung, Cl20ude S. H2owkins, Jr., Wyman R. Wade, Jr., Eddie H. W2olker, Jr., Shannon L 812on, limothy C. Sh2orum, Jason Maninn Delegate District 4-NW: Daniel 8. Thrailkill Delegate District 5·NW: Gordon Webb Delegate District 6·NW: John T. Tuum, David l. Eddy Delegate District 7·NW: Danny M. RasmussC'n, Rhonda Wood Delegate District 8·NW: Ted Sanders Delegate District I-e: 8rad H~ndricks. Gwendolyn O. HodgC', Ron A. Hope. Philip E. Kaplan, Harry A. Ught, Smk Ligon, harl~ C. Owen, Harold Evans. Charles L Schlumbc:rger, Don K. Barnes, Elizabeth A. Thomas, Marshall S. Ncy, Melva J. Harmon, John C. Wade, Jeff Broadw.uer, Marcella J. Taylor. Reed R. Edwards..\11. Stephen Bingham, John Wyvill, Causley Edwards. David Sterling, P;urick Harris, Brenda Stallings, Mark Allison. David Raupp. Rick Ramsey. Patrick D. Wilson

law Student Representatives: Valerie Glover, University of Arkansas School of Law; Jason Ltt, UALR William H. Bowen School of Law

i

He ,Irtlllls Llwyrr

""".lrt~lr.n.

1"'I'sid"111 \

111'111I1'1

We have aprofound role to plav Sandra Wilson Cherrv unbelievable grief; by the presence of mind of those facing death on doomed airliners;and the healthy renewaJ of dedication and love of country which is permeating every corner of this great land. fu; la\'lyers we have a profound pan ro play. The American lawyer has always been and muSt continue ro be the voice of

Our obligations to our countrv never cease, but

wnh our lives. - John Adams

of us have been indelibly changed by unspeakable aces of (errOf. We watched in disbelief as the New York skyline was altered forever by fanaticism and hare so

America, conveying both its courage and its strength. From the nation's infancy it has been lawyers. as patriots and scholars, who have led this nation in time of great trial. We can promote unity, set an example for our fellow citizens to follow, and encourage our communities to not only move forward with confidence, bur aJso with oprimism that our nation is strong and will not fail. This is our duty and our badge of honor. We must realize that aJl of us will be called upon in ways, nOt yet foreseeable, in the coming months and years, as our

calculated and efficient we could barely comprehend. We shuddered at pictures of the nation's military headquarters. the heart of our defense and intelligence, unbelievably a victim of a relatively small group of men, hem on our destruction. Death rolls soared beyond the cosdiesr moment in our history, - one day of battle at Antietam, Maryland. Yet, within twenty four hours, all the

nation ferrets our and destroys the evil which has shocked our very souls. Initially, challenge your communities, and indeed, yourself, ro unparalleled generosity, both of your treasure and your spirit. Give of your time and energies ro meet any need. And above all, remember our obligation to stand guard over our legaJ system ro insure that we do nor permit the unfair targeting of innocent citizens due ro their race or

strength and glory of this counrry was manifested in a profound sense of

place of birth. I have every confidence that our nation will lead the whole world ro victOry over

This nation and, indeed, the lives of all

community and uniry of purpose. Once again, each of us was heartened by the

courage of OUf fellow citizens - by New York firefighters and policemen, who abandoned all thoughts of personal safety ro rescue survivors; by the grace of family 111 members suddenly engulfed

terrorism Moreover, I have no doubt that our profession will contribute admirably [Q me nation's spirit. God bless each of you and this nation as we move forward.

"01.16 No. 4/I'aIl1001

The ,Irkmas Lalljef 1

Amendment 80's District coun Let's Make it "Cricket" This Time, Part I [Author's Note: Grateful acknowledgments are extended ro Emma Jane Ohnemus, Esq., of Little Rock, for research and edirorial assistance; Jane Portis Roeder of Conway, for research; the Honorable Darrell Hickman, retired Justice of the Arkansas Supreme Court and currently Circuit Judge for the 17th Judicial Circuit, for candid critique, commentary, and advice; and the Honorable David Stewart of the Little Rock Court, for a lively District point/counterpoint debate on significant issues and candid commentary on early drafts of this article.]

deserving of cornerstone staws in the judiciary that Arkansas is abour ro build. The legaJ profession must take this matter seriously ro ensure mat whatever was to be fixed by Amendment 80 gets fixed and gets fixed right.

TenI1ol1al JurlsdlcUon and Venue lor fllerclse 01 CI1mlnal Subject Maner JUrlsdlcUon

IntroducUon "That ain't cricket," my father used to say when something JUSt didn't seem right. That saying returns to me when I deal now with cases in which a person is sropped for a traffic offense in one town, then cited into court in a town miles away, even though the town of the Stop has a traffic Court. The law books state that such a filing is not defective, because municipal (now district) couns have countywide jurisdiction (except in ten counties that contain two judicial districcs, jurisdiction is "limited to the district"I). I don't doubt the abilities of the judges in the "other" tOwns: the situation wouldn't pass Dad's gUt check test. This and a few other aspects of Arkansas's inferior coun system arguably could be more efficient - but never have been because

.

.

The Honorable Victor A. Fleming, Little Rock District Judge, is me author of three books, editor of two, and for 15 years was a columnist for The Arkansas Lawyer.

The ,lrkanml.aW!fr

11I11I'.arkhar.rnm

by Judge Vic Reming, Ume

Rock District ClonnerIV Municipal) coun "that's the ways things have always been done around here." The quoted adage, a pet peeve of mine, is an often-used excuse not to improve processes or work product in the legal system. For example, jurisdictionaJ limitation on felonies causes cases to endure twO dockets before final disposition, even if the defendanr wants to plead guilty from the get-go. Also, cases involving real estate liens are statutorily precluded from disposition before judges who are fully qualified to adjudicate them. The jurisdiction of inferior couns is not a topic that causes many readers ro salivate. 2 Given the chance ro write about it, I started our with vigor. My enthusiasm waned a bit when I found myself knee deep in seemingly conflicting statures and cases decided by thin majorities. Amendment 80, the "New Judicial Article," Illay have settled a cenrury of conrroversy in one area and provided a foundation to shore up weaknesses in others. Or, as often is rhe case with new law, maybe not. But this tOpic is importanr,

Whether a person arrested in an area served by one inferior court may rightfully be hailed into a different area's court has been debated for years. Legislation, courr rules, or both pursunm to Amendmenr 80 may resolve this sticky question. Some of my colleagues believe that Amendment 80 provides that district court judges muSt now have their jurisdiction limited to offenses occurring in the governmental unit ("district") that elects them. Some (a group that includes me) believe Amendment 80 is not so clear on this point. What is clear is that change is at hand for the Arkansas judiciary. Motivated by the promise of non-partisan elections, the voters overwhelmingly dimpled their chads FOR Amendment 80 at the 2000 election. ow the question is, "What did we get?" Most prominently. we got a longheralded merger of law and equity at the circuit court level, and we got rid of party primaries for the judiciary as a whole. But we also got a curting board for the inferior court system - for changes in name, jurisdiction, and venue. Amendment 80 (effective July I, 200 13) establishes "district courtS" as "trial courts of limited jurisdiction."4 These courts "shall have the jurisdiction vested in" municipal, corporation, police, and justice of the peace courts. and courts of common pleas "at the time this Amendment takes effect [and] shall assume the jurisdiction of these courtS of limited jurisdiction and other jurisdiction conferred in this Amendment on January 1, 2005."5 Moreover, "Municipal Coun Judges in office [on July I, 200 I ,J shall

couns have not been of one mind as to whether an inferior coun iudge elected in one IDealitY should be able to hear a criminal case ariSing in admerent IDealitY... continue

III

office through December 31,

2004 .... "6 Resolving a pQ[enrial ambiguity, the 2001 General Assembly enacted legislation providing that the district court name was effective July I, 200 I, and that disrricc courts "shall have the jurisdicdon vested in the presently established municipal courts......7 Thus, jurisdiction conferred in Amendment 80 is effective in 2005. pursuant to Jurisd.iction conferred Amendmenr 80 will be effective then also, or later, in accordance with conferring statutes or rules. By pre-existing law, other jurisdictionaJ changes may be legislated before 2005, though in each instance,

whether AJnenclrnenr 80

supe~eded

rhe

enabling law is a valid inquiry. Several sections of Amendment 80 merit collective scrutiny for an understanding of the issue. Before examining them, it may be helpful to establish a conrext, from the standpoint of what has gone before.

Hlstor1c81 OVervtew Courts have nOt been of one mind as to whether an inferior court judge elected in one locality should be able to hear a criminal case arising in a different locality, especially when the locality of the offense is in a different county. Criticism has been aimed at law enforcement (for apparent forumshopping) and at municipal CourtS (for not dismissing cases). Prosecutors, who are uhimately responsible for where cases are filed,S have been unscathed by the controversy. No case has actually reached the issue of whether abusive forum-shopping occurred. The lead dissenter, Justice Hickman, was squarely against revenue-oriented court selection. Though he never suggested that the Attorney General, as chief law enforcement officer for the State, was the appropriate official to curb allegedly improper practices, one would think that a directive from the prosecutOr at the top of the food chain would have brought a halt to

any actual ahuses. This issue has deep historical rOOts. The 1873 General Assembly gave justices of the peace UPs) jurisdiction "coextensive with the county." First class cities of the day had "corporation courts," with jurisdiction to rhe county line. The intent was that if a crime was committed in the city, if the culprit were apprehended within the county, it was rhe city court's case; if the crime was committed outside the city, it was the JP's case. 9 For lack of a better phrase, the county line was actually the boundary for "apprehension jurisdiction" for boch courts. Apparently intending to carry this scheme forward, the 1874 Constiwtion lO authorized the legislature to invest city corporation CourtS with jurisdiction "concurrent" with JPs. Under this grant of authoriry, Act 87 of 1915 enabled certain cities ro create "municipal corporation courtS": Judges were elected at "city elections"; jurisdiction was "coextensive with the county." In Stllte II. Woodniff,11 the court upheld the legislature's power to give a court jurisdiction beyond the "geographical limits" of its town. Such jurisdiction has remained countywide. 12 This much-litigated precept 13 holds that if a city judge presides over an offense committed outside the city, the "no jurisdiction" defense is nor available, unless the offense occurred outside the county (in which event pre-trial dismissal is without prejudice I4 ). Stated simplistically, the case law features repeated instances ofdefendants • challenging the inferior court'S venue ro the inferior court and losing; • peititioning for a writ of prohibition, within which they are unable to raise constitutional issues, and losing; • being unable to appeal at this point because venue decisions are not final, appealable orders (and because a trial de novo appeal to circuit may cure all defects); • going to trial in the inferior Court and losing; • appealing to circuit and losing on trial de

novo; and • being unable to raise the inferior court venue issue because the venue issue was cured at rhe circuit court level. Also, typicaIly, on appeal jurisdiction overtakes venue as the key issue. The nomenclature is not consistent, but perhaps that is to be expected, as the Supreme court itself has remarked that venue and jurisdiction "are often used interchangeably. "15 Justice Newbern, in State v. Wtbb,16 used the phrase territorial jurisdiction, as distinguished from venue, which "deals with the place where a trial may be had."17 Justice Corbin, in State v, Osbornl 8 (which is not directly concerned with municipal court issues) used the phrase loclll jurisdiction, which "deals ... with where the offense is ro be rried."19 Territorial jurisdiction is to a court what in personam jurisdiction is to a defendant. The concept is that the person was in the territory when the deed was done. For a century this jurisdiction has been coterminal with the county line where criminal subject matter jurisdiction of municipal courts is concerned. Frankly, the law seems ro be that if a trial judge calls it venue, the case is transferred; if she calls it jurisdiction (without a qualifier), the case is dismissed (though without prejudice). The popular, if informal, norian is that when intra-county movement of a case occurs, venue is involved, but if inter-county movement occurs, then jurisdiction is involved. 20 The key characteristic of venue is that it "relates to practice and procedure and may be waived."2J As simple as that seems, several cases upholding countywide jurisdiction on the basis that intra-county case-shifting was a venue matter were 4-3 decisions, with vigorous dissent. The theme of the dissent has been that when a law lmendmeat 80 Continued on page 8

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lmendment 10 Continued from page 5 enforcemem agem {boous a coun other [han me one moS[ logically associated with the point of arrest, it looks like forumshopping.22 This lamem could be rectified by a venue statute or court rule, mandating transfer to required geographically logical or conveniem venues on timely objcecion, or by a directive from the Anomer General, directing chat district coun cases be prosecured in specified couns, based on geographical logic or convenience. Especially where traffic cases are concerned, this would likely have satisfied the dissemers, as traffic cases tcnd to produce revenue, the mmive oft-cited for why a traffic defendant sropped in one (Own wound up in coure in a [Own several miles disranr. 23 As (Q non-traffic cases, a similar rule or directive governing venue might tolerate prosecurorial Aexibiliry for cases, such as those involving a particular expertise or those in which obvious economies are served, though not to the detriment of the defendants. If legislation implementing Amendment 80 eliminates overlapping rerritorial jurisdiction of all district courts, then this entire area of discussion may be moot in 2005. But it wouldn't hurt to have a bencr rule to govern between now and rhen. Justice Hickman went so far as to say iliar when a judge elected by rhe vmers of one city presided over a crime occurring outside that city, a jurisdictional issue that could be raised SIlO sponte on appeal was presented, rather than a venue issue char faded in the circuit court appeal process. Be.lieving judges should nor hear cases arising ourside the locaJities electing them, he wanted to overrule \'(/oodru/f. Aside from practical problems in re-filing a dismissed case,25 as opposed to transferring a non-dismissed case, arguably, had the dissent carried the day, it would have been but a Pyrrhic victory for defendants, since the same charges would re-surface in a court down rhe road. However, the dissent garnered popular support. as reRected by ACts 1I 18 and 1574 of 1999, requiring counrywide election of municipal judges, except in coumies wirh a population of over 100,000. 26 The "system" long ago should have acred

S Ur ,Irkmas Lall)rr

lI\lw.lrk~Ir.re.

on this issue. If it is a venue marrer involving practice and procedure - the executive or judicial branch could have adopted a governing rule. If it is a jurisdictional marter - involving a judge's righr to exercise authoriry27 - the legislative branch could have enacted a more efficient statutory arrangement. Under Amendment 80, the legislature continues to have sole authority to establish territorial jurisdiction in criminal marters; the Supreme Court arguably has concurrent' authoriry to govern venue. In the second parr of this article (next issue of the magazine), we will look at the specific provisions of Amendment 80 that bar on this aspect of the jurisdictional issue, as weH as consider other jurisdictional issues that may shape the future of Arkansas's newest court of first resort. And, while this may seem a rather mundane issue to lawyers whose practice does not bring them frequently into the trenches of district COUrt, I urge the emire bar to take an interest. A century of controversial case law sends us the message that we can do bener. The passage of Amendment 80 gives us the opportunity to do so. Let's not pass up that opportunity.

fOOtnotes I Ark. Code Ann. §16-J7-206(b)(Rep!. 1994} provides thal the "jurisdiction of a municipal court shall be coextensive with the county in which it is situated, except in counties having tWO (2) judicial districts, the jurisdiction shall be limited to the district in which the cOlin is situated." Arkansas counties that are divided into twO judicial districts are Sebastian (,re Ark. onst. An. 13. §5; Ark. Code. Ann. §16-13-2002 (Rep!' 1994)); Prairie (m Ask. Code. Ann §§16-16-7J9 & 13-2502 (Rep!. 1994)); Clay. Craighead. and Mississippi (,re Ark. Code. Ann. § I6- I3-1 002 (Rep!. 1994)); Lawrence (u, Ask. Code Ann. §16-13-1102 (Rep!. 1994)); Franklin (u, Ark. Code Ann. §16-13-1302 (Rep!' 1994)); Askansas (u, Ask. Code Ann. § 16- I3-1902 (Rep!' 1994)); Logan and Veil (,re Ark. Code Ann § 1613-2302 (Rep!. 1994)). Subsequenr references to "counrywide" means "district-wide" where these counties are

2

3 4 5 6 7 8

concerned. St, also Ark. Code Ann. §§ 16-17-119(c} (Rep!' 1994) (governing bodies of cities in counties with over 25.000 residents may add municipal court divisions. "each of which shaH have jurisdiction coextensive with the county"). § 16-17-704(Supp 1999)(in civil cases municipal courts have original jurisdiction "coextensive with the county wherein the coun is situated}, 16-17-217 & 16-19-401 (Rep!' 1994) (in townships having a municipal court, justices of the peace "shall have original jurisdiction coextensive with the The same phrase, county"). "coextensive with rhe county," is used to describe the jurisdiction of mayor's, city, and police couns, but with the qualification that this jurisdiction is as to "crimes and offenses committed within the limics of the city." Suo ~.g. Ark. Code Ann. §§ 16-18-112 (Rep!. 1994). 14-44-108 & 14-45-106 (Rep!. 1998). Readers who do find this Issue compelling are encouraged ro watch for a greatly expanded treatment of this ropic in an upcoming issue of the UALR Law Review. Ark. Const.• Amend. 80. §21. Id. §7(A}. Id. § I9(B)(2}. Id. §19(A)(3}. Act J693 of 200 I. Former Astide 7. Section 24 of the 1874 onsritution provided that "The qualified electors of each circuit shall elect a prosecuting attorney . . Prosecuting attorney is defined as "any person legally elected, appointed, or otherwise designared or charged . . . with the duty of prosecuting persons accused of crimes or traffic offenses." It "includes, but is nOt limited to: (i) a prosecuting arrorney and any of his deputies or assistants; and (ii) a city attorney and any of his deputies or assistanrs." A,k. R. Cr. P. 1.6(b)(ii}. Under Ask. Code Ann. §16-21-103 (Rep!' 1994). "Each prosecurmg attorney shall commence and prosecute all criminal actions in which the state or any county in his district may be concerned." ~ ro cities, prosecuting attorneys may designate ciry attorneys to

9 10 II 12 13

prosecucc in municipal courts state misdemeanors occurring in the city. Ark. Code Ann. §16-21-115 (Rep!. 1994). See Slim v. Woodruff. 120 Ark. 406, 179 S.W 813 (l915). Art. 7, §43. 120 Ark. 406, 414, 179 S.W. 813 (1915). Su Note I, supra. Noteworthy cases include Stnu v. Langstaff. 231 Ark. 736, 332 S.W2d 614 (1960) (speeder's venue change from Hamburg Municipal Court to Egypt J P Court upheld on the basis that an order granting or denying a change of venue is nOt appealable); Pul v. Ktlky, 268 Ark. 90, 594 S.W2d II (I 980} (upholding imer-coumy venue in small claims, noring municipal courts "have no necessary connection wim county lines"); Pulaski County Municipal Court v. Scott, 272 Ark. liS, 612 S.W.2d 297 (1981) (county is "municipal corporation" for purposes of having municipal court); Horn v. Stau, 282 Ark. 75, 665 S.W2d 880 (1984) (law doesn't require defendant be charged in court nearest arrest, equal protection issue - "inability of county residents to vote for a municipal judge who has countywide authority" not reached); City Court of Pta Ridgt v. Tin", 292 Ark. 253. 729 S.W.2d 399 (l987) (by statute. where state offense was charged, venue motion divests city court of jurisdiction); City ofSpringdnk v. jones, 295 Ark. 129, 747 S.W2d 98 (1988) (pringdale Municipal Court, In Washington County, had no jurisdiction over offense occurring in Benton County segment of Springdale, even though city voters from both counties elected judge); "'chi" v. Stat<, 297 Ark. 206. 760 S.W.2d 858 (1988) (arrest "cast of Elkins" prosecuted in West Fork Municipal Court, jurisdiction and venue arguments lost justiciability in circuit court trial de novo); Griffin v. Stat<, 297 Ark. 208, 760 S.W2d 852 (l988) (f.lir trial with propet venue in circuit court mooted Fairness issue of Springdale resident's being arrested in Springdale's Washington County part and tried in Elkins Municipal Court over venue objection,); Sexson v. Municipal Court ofSpringdalt, 312 Ark. 261, 849 S.W2d 468 (I 993} (Ark.

Code Ann. §16-17-206(b)(2) (Supp. 1991). enlarging municipal courts' jurisdictions to include parts of cities that extend into omer counries, held unconstitutional); Stat< v. Wtbb, 323 Ark. 80.913 S.W2d 259 (1996) (equal protection claim rendered moot at circuit court level in case of seven defendants arrested in areas of Bemon ounty, other than Rogers or Bemonville, bur hailed into those cities' municipal courts). 14 Stat< v. Osborn, 345 Ark. 196, 203, 45 S.W.3d 373 (2001). 15 /d. 16 323 Ark. 80, 913 S.w.2d 259 (1996). 17 Id 323 Ark. at 85. 18345 Ark. 196, 199, 45 S.W3d 373 (2001). 19 "Ordinarily, venue refers to the geographic area, like a county, where an action IS brought to trial. ... Ulurisdiction is generally thought of as the power of a court to decide cases, and it presupposes control over the subject matter and the parties.... One type of jurisdiction is known as 10caJ jurisdiction [which] 'deals only with where the offense is to be tried, noc with whether the scate lacks the basic authority to apply its criminal law to the events in question'." Id.. citing LaFave, Criminal Procedure § 16. 1(al, at 461 (2d ed. 1999). In my opinion, Justice Corbin virtually equates local jurisdiction with venue, though he wrote that me Olborn facts presented "an issue of local jurisdiction, not venue." Id. 20 A statute that speaks of moving a case between municipal courtS in the same couney refers to chang~ of venue. Ark. Code Ann. §16-17-116 (Rep!. 1994). Unfortunately, this is the only statute that speaks to the issue of changing venue in district court cases, and it provides mat a defendant must show almost overt prejudice in order to be entitled to a venue change. Another statute speaks of municipal judges' ~xchanging jurildiction III their respective city and couney districts." Ark. Code Ann. § 16-17-102 (Rep!. 1994). This statute provides a loose standard by which district judges may shift their dockets among each other without regard to where cases arose or

21 22

23

24

25

whether the presiding judge was elected from the area in which the offense was committed. The laner's broad wording accommodates inter- and inua-county relocation of hearings, as well as the inter- or intra-county travel by judges to sit for each other. I've used it to send a case co a neighboring county and to have another judge travel to Little Rock to sit for me. Griffin, "'pra Note 13, 297 Ark. at 210 (Glaze, J., concurring). Funds collected as a result of municipal COUrt criminal proceedings are deposited into the treasury of the city in which the court is located and are available for "general municipal purposes." See Ark. Code Ann. §16-17-119 (Rep!. 1994). uggestions of monetary mouve are less than veiled in Justice Hickman's dissents in Griffin. Pschi~r, and SCOff, mpra. ore 13. In Griffin. supra. Note 13, 297 Ark. at 215, Judge Hickman pondered why a deputy sheriff who arrested Griffin in pringdale, "a city of 25,556," would cransport him to Elkins,"a town of673" - "because the justice was better there? ... Perhaps he wanted to help Elkins out in its revenue raising efforts. In fiscal year 1988, Elkins collec,ed $46.353.00 in fines. Perhaps the sheriff's office favors Elkins, or maybe it is just a maner of spreading business around." Id., 297 Ark at 215-16: "The municipal courts of Elkins and West Fork have no jurisdiction over misdemeanors com mined outside their city limits. ... The coun can ignore the problem IIlld hop~ tl constitutiolllll amendment will b~ passed or that these cases won't pcrsisr. ... [A]nytime a policeman can decide which judge will determine the fate of the defendant, there is an open invitation to corruption." (Emphasis added.) In a traffic marter, assuming the arresting officer had jurisdiction to issue the citation, a dismissal without prejudice in district court would involve either creating a file in the dismissing court, retaining a certified copy of the original citation, and returning the original citation to the issuing agency or Amendment 80 Continued on page 11

111.16 SI. lIFall 1001

Ue Arkmas La~w

Old Dog

Articles of Incorporation The lJldersIgled acting as trIcorporarors of a corporation ooder the M<ansas BusinesS Corporation Act (ACI958 (11987), adopt the folowing Articles of InCorporation of such Corporation.

First:

Th, "Ime of rho c..pultlon II:

l"'Meomp"""

"'C..,.,,-.

Mu.I r_ _ the . . . "Corpor_', 'lncorpor"~. •a....,ud". or Ibt abllrnutaoa "Corp.", "IDe.'. "Co.,. or 'U4' or.-wclll OI .... ~oflit.lIIIportll'ltl'lOUlll'~.

New Trick Now, there is a faster, easier way to file corporation documents in Arkansas. The Online Filing System for Corporations, or OFS, was developed by the Secretary of State's office to promote electronic government in Arkansas. OFS is available 24 hours a day, 7 days a week, making the task of filing corporations documents convenient and maybe even fun!

Here Is I just I

SImple of whlt'llVIlllbIe:

• Articles of Incorporation for Domestic, Foreign, LLC, and Non-Profit Entities • Registration of a Fictious Name for Domestic, Partnership, and LLC Entities • Registration of a Corporate Name for Domestic and Foreign Corporations • Domestic Corporation Franchise Tax Registration

www.sosweb.state.ar.us © 2001, Information Network of Arkansas.

10 Tlr lrkmll Llwyrr

Mww.arklll.UI

www.accessArkansas.org

AII.I_180 Continued from page 9 to

the local prosecuring authority for

transfer

(0

the prosecuting authority in

the appropriate jurisdiction. or, if the dismissing court retained the citation without

accommodation

to

the

prosecuting authority, the drafting of an

CLIENT SUPPORT SERVICES Moore Stephens FroSt is the state's largest Arkansas-based accounting firm. The diversity of our clients and the resources we possess mean

affidavit for an arrest warram for

that we can dedicate a team of professionals on any project in a

processing in the appropriate jurisdiction. issuance and service of the

timely and results-assured manner. In faCt, our strategic services go

warra.rl t, etc.

far beyond what traditional accounting firms offer. Our goal is to

support you as you, in turn, support your clients. 26 Ark. Code Ann. §§ 16-71-120 & 130 (Supp. 1999). These bills came up on In the areas of Business Valuations and Litigation Support, we offer rather shorr notice in the 1999 General Assembly, prompting an inquiry to the a number of focused services designed to meet specific objectives. sponsors, who candidly stated that certain residents of smaller counties who BUSINESS VALUATIONS lived oucside the voting parameters of cenajn municipal judges in their Marital Dissolutions· Estate and Gift Maners counties believed they should have the Charitable Contributions· Spin-offs and Reorganization right (0 vote on the municipal judge before whom they either might have to Business Dissolutions· Buy-Sell Agreements appear. That the solution employed was Sales or Mergers· Bankruptcy and Reorganization to expand the universe of municipal Employee Stock Ownership Plans judge electors, rather than mandate that law enforcement file cases in geographically logical venues is ironic. EXPERT TESTIMONY, CONSULTING The irony is highlighted by federal court AND LITIGATION SUPPORT precedem, approving circuit court "electoral sub-districts," in which Economic Loss Analysis· Damages Computations minority voters, constitutjng a majority Marital Dissolurions • Due Diligence of residents, elect judges who then Forensic Accounting Services· Income Tax Analysis expressJy have terrirorial jurisdiction exceedjng the geography of the area that Call Cheryl Shuffield, director of Client Support Services, at elects them See, e.g., Hunt v. State, U.S. D.C (E.D. Ark.) No. PB-C-89-406 (501) 975-0100 for more infotmation. (Nov. 7, 1991), explained in Caldwell v. State, 322 Ark. 543, 547-48, 910 S.W.2d 667 (1995), and Kemp v. State, 324 Ark. 178, 190-93,919 S.w'2d 943 (1996). See also Holt Civil Club v. City MOORE STEPHENS FROST ofTilScaloosa, 439 U.S. 60, 69-70 (1978) "More than an accounlingfirm~ (under AJabama law allowing municipal court jurisdiction three miles beyond Certified Public Accoumants - A ProfeSSIonal Limited Company city limits, residents of unincorporated 425 West Capitol- 'suite 3300 - Lade ROl.:k, Arkansas 72201 (501) 376-9241' (800) 766-9241' Fax (501) 376-6256 community had no constitutional right \\'\vw.msfrosr.com to participate in political processes of ;::::::::::::::=....;;,,:::::::::::::::::::=-__..::::::::::::::::=-__::::::::::::::::::=-_., city simply because they were subject to For information about advertising in its police and sanitary regulations). 27 Su Note 27, infra. The Arkansas Lawyer, 28 The term geographical area (§16(D)) is, contact Pat Jones at 501-375-4606 if nothing else, a far less definirjve tcrm than analogous nouns of common

or 800-609-5668

Amendment 80 Continued on page 51

pjones@arkbar.com 101.36 No. 4/~aIl2UOI

1'he ,Irkillil LaWler

II

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11

Tie ,Irkilla! Lall\1r

1I1I1I:arkbmom

Arkansas Attorney Discipline UPDATE by Stall Ugon ignificanr changes in the Arkansas Arrorney Disciplinary Procedures and cwo Model Rules of Professional Conduct will take effect January I, 2002. Announced by a Pet Curiam from the Arkansas Supreme Court issued July 9,2001, the full text can be found on-line at

S

http://courtJ.stau.ar.uslopinioml200I0709.h, m (second item in the Appendix) in both HTM L and WordPerfect 5.1 versions. Many of these changes result from the February 2000 "Arkansas Report on the Lawyer Regulation System," issued by the American Bar Association Standing Com mince on Professional Discipline. which visited Arkansas in the Fall of 1999. We believe the new Procedures will be applied to all cases pending as of January I, 2002, or filed thereafrer. The mOSt significant change is probably the one that will provide a new hearing panel [0 a charged attorney at each new stage of the disciplinary process. At presem, the same seven member panel decides case at both the ballot VOte (first) and the public hearing (second) stages. Under the new Procedures, up to three different panels will be available for use on baJlor voces, public hearings and discipline by consem offers. The hearing panels will utilize twemy-one Arkansans, six of whom will be non-lawyers, as members. Panel membership will be rotated petiodieally. Other significam changes are: (I) a finding mar an anomey has commined theft of property from a c1iem or been convicted of a "serious crime" will result in automa(Jc initiation of disbarment

me

Stark Ligon has been Executive Director of the Arkansas Supreme Coun Office of Professional Conduct slOce January I, 2001.

proceedings; (2) the Office of Professional Conduct will now have authority to appeal hearing panel (Comminee) decisions to the Supreme Court; (3) me Executive Director's concurrence will be required on all discipline by consent offers before they can be submitted to a panel for consideration; (4) Supreme Coott approval will be required on all discipline by consent offers where the charges involve "serious misconduct"; (5) disbarment proceedings will be assigned to a special judge appointed by the Supreme Coun and hearings will normally be conducted in Pulaski County; (6) the judge in disbarmem proceedings will make findings of fact and only a recommendation on sanction, leaving the actual sanction decision ro the Supreme Court; (7) the Committee's authority co suspend has been increased frol11 twO to five years; (8) the Committee's fine authority has been incteased from $1,000 to $25,000; (9) the Office of Professional Conduct is given additional informal "diversion" tools to use, such as lawyer assisrance program referral, mediadon, and fee arbitration; (10) the confidentiality/privilege requirement on all panicipams in the disciplinary complainr process has specifically been extended to complainams; and (11) the previous prohibition against suspended anorneys being employed in any capacity by an attorney or law office has now been extended to include attorneys who surrender their license, are disbarred, or are on inactive status. The Procedutes will still generally follow the same process in all but disbarment proceedings: receipt and staff investigation of a written complaint; a decision on filing a formal complaint, informal diversion or administrative dismissal; a ballot VOte by a pand based solely on the pleadings; a public hearing if requested by the respondem anomey; and an appeal de novo on the hearing record to the Arkansas Supreme Court. The process and file will remain confidemial unril the public hearing commences or final disposition of a complaint by public sanction. Discipline by consem is available at any stage after service

of a formal complaint on the respondent atcorney. Model Rule 1.15(d)(l) is amended to add a requirement thar (alTA anorney trust accounts can be maintained only in banks that agree with the Supreme Court to mail "overdraft" notification on all "insufficient funds" trUSt account checks (paid or not paid) ro the Office of ProfessionaJ Conduct, which will investigate such matters as possible "early warning" signs of problems for the attorney and his/her clients. Model Rule 1.4 is amended by add (c), requiring an attorney to promptly notify a client in writing of the actual or constructive receipt by the attorney of funds from any source, which represent funds to which the client is entitled. Our statistics continue to show about 1,000 new complaints received each year and about t 50 that result in filing of formal charges annually. The mostly commonlyfound Model Rules continue to be those involving conduct prejudicial to the administration of justice (usually causing delay), attorney diligence and promptness with client matters, keeping the client informed, attOrney competence, matters involving attorney dishonesty, fraud, deceit or misrepresentation, and failure to notifY and deliver funds due to clients. While the Office of Professional Conduct is not permitted to give advisory opinions. the professional staff hopes to engage in a substantial educational effort with the bar and the public to attempt to reduce alleged misconduct and new complaints. Staff attorneys are available for programs and CLE opportunities by calling 501-3760313 Ot 1-800-506-6631. In June rhe Arkansas Judiciary website began offering information about public disciplinary histories of Arkansas licensed attorneys online at httpll.courts.stllu.Ilr.u.slattylisl. In the future, we plan to add a link from the disciplinary history listings to the full text of the Committee's findings and order in each case. _

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TlDl'"

uers-

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Summation

Timeslips.

e .

DRAGON SYSThMS

Eliminating Barriers to Justice in Arkansas: Legal Services Reorganization by Hale COuner Several weeks ago I ran across a lormer clienl who several years earlier had come 10 see me Ihrough VOCALS, Ihe pro-bono relerral program 01 Ihe Pulaski COunly Bar Associalion. As I wailed in line wilh her 10 pay lor my collee. Ihe young woman I had represenled in a CUSlody dispule wilh her mOlher proudly inlormed me Ihal her children were doing well in school and Ihe lamlly breach Ihal had prompled her 10 seek legal counsel had mended. When I first met this woman she had rebounded from a severe crisis that had landed her in uouble and separated her from her three young children for an extended period. Through a couple of hearings and the appeal process. we had secured her reunion with her children. Seeing her now and hearing how things had gone since we obtained a chancellor's ruling that the woman was a fir parent, notwithstanding her many past mistakes, reminded me anew how cficicaJ it is ro have access (0 legal advice in a crisis where often there are no good options. only ones that are relatively less painful.

About the Author Nate Coulter IS currently a partner at

Wilson,

Engstrom.

Corum & Coulcer in Little Rock. He is chair of rhe Arkansas Bar Association's Legal Services Committee, a past presidem of board of Legal Services of Arkansas and a 1985 graduate of Harvard Law School.

me

Several imponam developments in reeem monrhs offer significant promise of enhancing the availability of this critical access [0 legal assistance for Arkansas's low income citizens. The first of these is the reconstitution of the primary service providers -- the legaJ services programs. As recently as six years ago, there were seven legal services programs serving various geographical configurations within the state. The Legal Services Corporation, a federally funded agency in Washington and the primary source of funding for OUf state's legal services for the poor, began in the mid 19905 to emphasize scate planning as a means of encouraging better coordination among the six programs. As parr of the ongoing scatewide planning process in Arkansas, a group composed of the program directors from each of the six legal services programs, rhe IOL;rA sraff and board members, Arkansas Bar Association staff and leaders, and the Arkansas Judicial Council have convened to establish concrete ways of expanding and improving the delivery of civil legal services in Arkansas. One important facet of this state planning process to improve the capacity of the Arkansas legal services programs is the consolidation of Arkansas' six separate, 110n-

profit organizations into twO legal services programs. That much is about to happen. The tWO largest programs, Central Arkansas Legal Services and Legal Services of Arkansas, merged successfully into the Center for Arkansas Legal Services (the "new" CALS) five years ago. Together they now serve 32 counties in Central and South Arkansas. The remainder of the state is served now by four smaller programs. Merger talks are progressing that will eventually join Western Arkansas Legal Services (WALS) with

CALS. This merger will be completed before the end of 2001. Additionally, negotiations have begun between the Center and East Texas Legal Services (ETLS) which has had until now the responsibiliry for serving the poverry population of four counties in Southwest Arkansas. The likely resolution would allow both programs to share the Texarkana branch office and shift the four Arkansas counties to a program in the state where the counties are located. This makes more practical sense than having these counties served by a Texas-based agency, if for no other' reason than that the lawyers, judges and diems in those four counties send their tax dollars and legislative

10l.l6 10. 4/1'0112001

The IrkooSl! LallIer

1\

represematives to Litrle Rock, not Austin. Finally, efforts are well underway to merge the remaining three programs, East Arkansas Legal Services, Legal Services of Northeast Arkansas and Ozark Legal Services, imo one program that would serve northern and eastern Arkansas. Because it covers a very large expanse with pockets of relative affiuence as well as some of the most impoverished coumies in the state, this merger is the most significant. The merger commirrees for each of the three programs, for example, are examining sociodemographic facrors in the proposed service areas, the most prevalent client service issues, recurring community and staff concerns, as well as operational and legal logistics. The challenges of this merger are many but the potential benefits far outweigh them. The two-program statewide srrUCture that is emerging as a result of the planning efforts and the ensuing mergers will achieve a number of important objectives, all pointed roward an effective, client-centered statewide delivery system. The new structure should eliminate some administrative duplications, create a second program in the state with sufficient size and depth to function as a major law firm in Arkansas (the two programs will be among the rop Arkansas firms by size), release leadership talent from bureaucratic humdrum for reassignment to advocacy and policy leadership, consolidate local advocacy around judicial districts that have previously been split among several programs, and help the offices of all the current programs improve the quality and effectiveness of their advocacy through co-counseling and team work on cases. While offering efficiencies through consolidation and cooperation, the two program structure will preserve effective elements of our current system. The focus of legal work supervision and delivery will remain in the local offices, under the leadership of managing attorneys who are aware of local needs, court practices and community expectations. The twO project directors will retain some direct conract with the legal work of the programs. The new northern program -- which is yet to be named -- will be large enough to realize some economies of scale withom being so large to create bureaucratic impediments. It will also maintain the racial diversity of the board and the staff that is critically important to a successful program.

16 The lrkmas Lawyer

wlflf.ukbar.rom

Having cwo programs of roughly the same size in the state should foster a healthy dialogue about maximizing the potential of the state system, and perhaps even a bit of useful competition as the twO programs seek to outdo one another in the excellence of their advocacy. It is my hope that the [\'10 programs together will lead the bar, the courts and commumty orgal11zauons to create 3n effective statewide legal services delivery system. Part of achieving that end entails having the two programs initiate and refine some state level functions for assisting the largely federally funded programs. Moving to the greater efficiency and effectiveness of a complementary, two-program state delivery system and a funded set of statelevel functions would ensure that ail income eligible individuals in Arkansas have equal access ro quality legal services. The merger of the existing programs is not the only important recent development on the subject of providing access to justice in Arkansas. On March 23, 200 I, the Arkansas legal services programs and {he Arkansas Bar Association sponsored an Access to Justice Symposium. One hundred and fifteen individuals representing the judiciary, bar, community groups and state and federal government attended the one-day event. The discussion groups focused on six challenges facing the Arkansas justice community: effective delivery of advice and brief services; increased pro bono involvement; increased resource development; development of statewide leadership; more effective collaboration; and alleviating ingrained panerns of legal needs facing the poorest citizens. Based on the day's presentations and discussions, the assembled leaders from the Arkansas state justice community agreed that an Arkansas Access to Justice Project should be created to lead the burgeoning efforts to improve access to justice in Arkansas. The group asked legal services leaders to work with state bar leaders ro recruit initial members for the Project. In addition, the following steps were suggested for consideration: develop an information packet to support greater private bar pro bono service; survey what the public knows about access to justice and what the public needs help with; â&#x20AC;˘ establish a statewide telephone advice system for low income cliems;

strengthen and expand the statewide resource development effort; organize a representative groupl foundation for fund-raising and education; contact local news media about the imponant needs for justice among the poor. Any effort to serve more people and to be more efficienr mUSt focus on the typical unmet legal needs faced by Arkansans who cannot afford a lawyer. To help sharpen that picture, the Bar Foundation and the legal services programs are now working on a comprehensive legal needs survey. That information will in turn help providers, judges and legislators who believe the state has an obligation ro ensure that everyone has access to the courthouse or access to a lawyer trained to help them avoid the kinds of problems that force them to visit the courthouse. Finally, Congressman Vic Snyder of Little Rock and the Legal Services Corporation announced on August 8, 200 1, that Arkansas's legal services programs would receive a $409,000 federal technology grant. The gram will pay for improvemems to the statewide legal services website; a centralized statewide legal advice and referral telephone hotline; and the creation of virtual law offices in six locations around the state. In addition to access ro some legal advice, these virtual offices would afford access to a computer, telephone and fax machines. Neither income nor geography should determine an Arkansan's access ro legal advice. A person who faces a legal crisis in a rural county should have ready access to a pro bono attorney just as the woman living in our most populous county had when VOCALS referred her to me. With these recent developmenrs, we are moving closer ro eliminating long standing barriers to justice in our state and forging new standards of excellence in the provision oflegal services to the poor in all corners of Arkansas. For further information regarding the Arkansas legal services programs' collaborate involvement in efforts ro achieve a statewide, integrated state justice community, please read the Arkansas State Planning Report. You can request a copy by comacting Debra Garrison at the Arkansas Legal Services Programs Resource Coordination & Training Unir, (501) 3763423, 1-800-950-3423, or dgarrrison@arkanasiegalservices.org. _

BANKRUPTCY REFORM LEGISLATION The good, the bad and the unknown by Unda Reid

Bankruptcy reform legislation is merely one conference committee and President Bush's signature away from becoming law... II the legislation now in the final stages of consideration by Congress passes in its present form. lawyers can expect to have to learn anew many of the Bankruptcy Code sections applicable in consumer bankruptcy cases.

Histon 01 DIe CUrrenl BanwPICV Relonn leglslaUon In june, 1998, the House of

fall session of Congress.

Representatives passed what nearly became

"pocket vetoed"

the most sweeping bankruptcy reform

C1inron.

legislation in rwemy years. A comparable

Bankruptcy reform legislation was introduced in the l07th Congress on

january 31, 2001, in the form of H.R. 333,

Durbin (I L), Feingold (WI), Kennedy (MA), Kohl (WI) (author of the Senare homestead amendment), Leahy (YT) and Schumer (NY). The Republicans include: Grassley (IA), Sessions (AL), Kyl (AZ), McConnell (KY), DeWine (OH) and Harch (UT). On july 18, 2001, the Senate sene a

and House versions were reconciled just before Congress adjourned in October, 1998. The House approved the reconciled

the "Bankruptcy Abuse Prevention and Consumer Protection Act of 200 1," and S.

motion to the House Aoor [Q go [Q conference on bankruptcy reform legislation

220, the 路'Bankruprcy Reform Act of2001."

(H.R.333). On july 31, House judiciary

legislation but the Senate never vored on the

These bills were essentially idemical ro each other and to (he bill passed last year. The House passed a slighdy amended version of

Chairman James Sensenbrenner (R-Wis.), who will preside over the House-Senate conference committee, named a rotal of 12 House Republicans and seven Democrats to join the 13 Senate conferees to reconcile House and Senate versions of bankruptcy

bur slightly less stringent biU was passed by the Senare in September, 1998. The Senate

final bill and it died on the Senate Aoor. Similar legislation was introduced in 1999. Thar legislation failed to pass in the

Nearly identical

reform legislation was passed by Congress at

the close of the 2000, bur was subsequencly by

former

President

its bill on March 1,2001. The Senate Judiciary Committee marked up ics bill and reported our a clean bill, S. 420, which was passed on March 5, 200 I.

Linda

Reid

IS

On july 17,2001, the Senate voted 82-

director

16 to adopt Senate bankruptcy reform

of Career Planning

language (S. 420), passed in March, under the bill number of rhe House-passed H.R. 333. Senare Majority Leader Daschle (DSD) and Senare Minority Leader Lo" (D-

cUffendy

and Placement at the University of

Arkansas School of Law in Fayeneville. She was formerly Senior Law Clerk ro the Honorable Robert F. Fussell, U.S. Bankruprcy judge for the Easrern and Western Districts of Arkansas.

Miss.) appointed seven Senate Democrats and six Senate Republicans as conferees to resolve me differences in the House and Senate versions of the reform bills.

The Democrats include: Biden (DE),

reform (H.R. 333) in conference. The Republicans named include: Representatives Sensenbrenner, Bachus (R-

Ala.), Barr (R-GA), Barron (R-TX), Boehner (R-OH), Cascle (R-DE), Chabor (R-OH), Gekas (R-PA), Hyde (R-IL), Oxley (R-OH), Smith (R-TX), and Tauzin (R-LA). The Democrats include: Representatives Boucher (D-VA), Conyers

(D-MI), Dingell (D MI), Kildee (D-MI), laFalce (D-NY), Nadler (D-NY), and Wan (D-NC).

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Sensenbrenner has announced thar he wants conferees to meet formally for the first time soon after members return from their summer recess on September 4, 2001. Once a conference bill is worked out it musr be approved by both houses before it is submitted to the President.

The ProDosed lelIISI8l1on A primary intent of the bankruptcy reform legislation is to make it more difficult for consumer debtors to discharge debts under Chapter 7 of the Bankruptcy Code, thereby pushing more debtors into Chaprer 13. Some of rhe changes in borh bills that will impact consumer bankruptcies include: Means testing. The bills establish a "means test" for consumer bankruptcies that would force individuals who have the capacity to pay back some of their debts to do so through Chapter 13 instead of wiping their slates clean through Chapter 7. The testing, designed to determine the extent of a debtor's ability to repay general unsecured daims, has three elements: (I) a definition of "current monthly income" measuring the total income of a debtor is presumed to have available; (2) a lisr of "allowed deducrions" from current monthly income, for purposes of support and repayment of higher priority debr; and (3) defined rhresholds ar which the income remaining after the allowed deductions would result in the presumption of abuse in the filing of a hapter 7 petition. More specifically, 707(b) of rhe Bankrupt9' Code would be amended to

provide for dismissal of Chapter 7 cases or (with the debtor's consent) conversion to Chapter 13, upon a finding of abuse. Abuse would be presumed if the debtor had more than $100 in monthly income available to pa)' general unsecured debt, based on a formula incorporating collection standards of the Internal Revenue Service. Debtors whose family income exceeds a national median for their size family would be required to go through this "means testing" on the request ofany creditor. Debtors with the ability to pay 25% (Senate version) or more of their unsecured debt would be required to file a Plan under Chapter 13 and make payments for a minimum of 5 years.

Credit CozlTlseLing/FinanciaL Management Training. Debtors would be required to obtain credit counseling from an approved non-profit agency within 180 days prior to the filing of a bankruptcy petition. Debtors would be required to first a[(empt to negotiate a volumary repayment plan through the consumer credit counseling sen'lce before filing for bankruptcy protection. This requirement might not apply if rhe debror faces a porenrial loss of property before the debtor could complete rhe good-fairh arrempr. The debror would be required to file a certificate from the credit counseling service with the courr. If the debtor entered into a debt repayment plan, that plan would also have to be filed with the courr. To seek discharge under Chaprer 7 or 13, debrors would also be required to attend a personal financial management instructional course following the filing of a bankrupt9' petition. Debtors

....

Registered Professional Engineer in 3 Slates.

....

9 )'ears of experience as President of large distribulor spcciali7Jng in all types of s..'lfcry equipment, m.ajor emphasis on meml forming and stamping.

....

II yC:lrs of experience as PresidcllI of company involved in repair and rewinding of electric motors and manufacLUre, sales, install:uion and servicing of electrical control panc:ls for indl\stry,

....

14 )'cars of experience with General Elenric Co. in engineering and industrial sales. Earned BS - ElcctriC'dl Engineering in 1947. Complelc curriculum vilae and references on request.

18

Tke ,Irkansas !,allIer

Ifllw.arkbmom

who failed to complete the instructional course would be subject to denial of discharge. Additional Filing Requirements. Debtors would be required to provide copies of their tax returns to the Unired States Trustee (with disclosure to any interested party), and other information regarding their income, expenses, and assets. Failure to file this information would result in automatic dismissal of their case. Debtor Audits. Under the provisions of both bills, a certain number of cases (no less than one out of every 250 filings) would be pulled randomly and the petition, schedules, and statement of financial affairs scrutinized by independent certified public accountants using "generally accepted auditing standards." The U.S. Trustee would be authorized to take action when "material" misstatements in the debtOr's petition and schedules were identified. Child Support. Under rhe proposed legislation, court-ordered child support and alimony payments would no longer be stayed during the pendency of the bankruprcy case. They would also receive priority over most other claims, including the trustee's fee in administering the estate. They would not, however, enjoy higher priority than property tax liens. In other words, if a debtor owed bOth property taxes and child support, proceeds from the sale of liened properry would be applied firsr ro rhe property tax claim, then to the suppOrt claim. Cram Downs. Cram down wouJd be eliminated for mOtor vehicle loans obtained

within five years (three years in the Senate

transfer if the amount transferred is less than

version) prior to the filing of the bankruptcy peticion. As co other personal pro percy. the cram down would not be available for any

$5,000.

loan incurred within one year of the filing of

For the purpose of those provisions. a small business debtor would be a debtor with no

In order to maximi~ the paymenr to general unsecured

more than $3,000,000 in the aggregate

legislation may significantly hinder or altogether eliminate their abilicy ro file for bankruptcy protection. The effect of many of the new restrictions intended ro make it more difficult to file for bankruptcy will be that debror's attorneys will be find themselves spending more time

amount of secured and unsecured debts as

and effort on behalf of their debtor client.

creditors, Chapter 13 would be amended to

of the date of the bankruptcy filed.

require a minimum plan term of five years for d.ebtors whose income exceeds the median income of the applicable state for a comparable earner. Non-disclJarg~abl~ D~bts. Luxury

DMdlin" fOr Filing a Plan.

Small businesses that file for Chapter II have only

The prediction is that this will result in higher attorneys fees. Most bankruptcy debtors. who currently

six months co demonstrate that they have a realistic chance of successfully reorganizing.

avail themselves of the bankruptcy relief offered under Chapter 7. receive their

Those that can't will be liquidated, with

discharge in less than six months. and can be in a posicion to establish reasonably good credit within two years after discharge. Under the new legislation the emire process. because of the requiremenr of financial management training and for other reasons,

the bankruptcy petition. Minimum Plan urm.

purchases totaling over $250.00 ($750.00 in the Senate version) within 90 days of the

bankruptcy filing would be presumed to have been incurred by fraud, and all fraudulently incurred debt would be non

dischatgeable in both Chapter 7 and

Several provisions were also added with

regard to "small business" chapter 11 cases.

their assets distributed [Q creditors. or the cases dismissed.. Singl, AIm Rtal ÂŁSta" CastS. The bills would also clarify the circumstance under which a secured creditor can obtain stay relief in a "single asset" case where the sole substantial asset of the estate is real propercy.

Chapter 13 cases. Exemptions. The Senate version contains

The bills provide that to avoid a lifting of a

a $100,000.00 cap on the Homesread

stay that would allow foreclosure. the debror

Exemption that could be claimed in a bankruptcy action. The House version

must, within 90 days after filing the Chapter

contains a $250,000.00 cap but allows srares "opt our" by subsequenr enactment. In addition, debtors could not avail themselves of state domicile exemption laws unless a domicile of the subject state for at to

least 730 days prior ro the filing of the

11 petition. commence paymenrs ro the secured crediror in an amoum equal ro the imerest on the value of the secured creditor's interest in the real propercy. using appljcable non default contract rates of interest.

The bills call for the Advisory Committee

determine the state of domicile of the debtor

on Bankruptcy Rules ro propose for adoption standardized djsdosure statements and form plans for reorganization of small business debtors and adopt uniform national reporting requirements. The bills also contain numerous "technical amendments" to make corrections in. and clarification of, provisions of the Code

for purposes of exemption laws applicability.

applicable in Chapter 11 cases.

bankruptcy petition (in comparison to the 180 day residency requirement). However, if a debtor's domicile was not in a single

srate for the 730 day period, the place of domicile of the debror for a majority of 180 days preceding the 730 day period would

Although the bankruptcy reform scaNes passed by the House and Senate are principally aimed at consumer bankruptcy issues. there are several provisions in the rwo bil1s that would affect business reorganization cases as well:

I'rrfirmtial Tm,zsfm.

The bills make

changes in the preference recovery section

(547) of the Banktuptcy Code to (l) increase the period from ten to thircy days after the granting of a lien within which a secure creditor may perfect a lien and

thereby prevent the perfection of the lien from being considered a "transfer" that could be subject to avoidance as being preferential and (2) provide an exemption in non-consumer cases for what would

otherwise be an avoidable preferential

will take longer. Additionally, many debtors required to file under Chapter 13 wil1 not receive their discharge for five years. The legislation provides numerous benefits to creditors. including increased opportunities to object or get involved in the bankruptcy process. Creditors will undoubtedly have more leverage to obtain payments from debtors through bankruptcy. This may also mean that creditors will b~ more difficult to deal with outside of

bankruptcy. If the bill becomes law, bankruptcy filings are expected to soar in the six months before it goes inro effect. According to Samuel Gerdano, executive director of the American Bankruptcy Institute. ancicipation of the legislation contributed to a 17.5 percenr increase in bankruptcy filings in the first quarter of this year. He has already

predicted that the number of bankruptcy COIIIQII.ClI 01 1lef_1I COI_

cases

Consumers with relatively high income compared ro their unsecured debt willlikdy

be required to file under Chapter 13 and make payments for a minimum of five years. This may work well for many debtors, bur for others it takes away much of the incentive to file bankruptcy. Experts anticipate thar many individuals will manipulate their financial Status by reducing their presenr income (temporarily quitting a second job or refusing overtime) or by artificially inflating their debts in order

qualifY for relief under Chapter 7.

For

individuals with higher than average expenses (many of which would not be counted in the means resting), the new

filings will reach a record 1.5 million this year, primarily due to the slowing economy and high consumer debt.

Last year, 9319 Chapter 7 and 7322 Chapter 13 case were filed in Askansas. Through July 31 of this year, 7658 Chapter 7 and 4992 Chapter 13 have been filed. According to William Blevins, Clerk of the United States Bankruptcy Court for the Eastern and Western Districts of Arkansas,

Chapter 7 filings have increased markedly this year. Notably. the biggest increase came

in the month of March (1530 new Chapter 13 cases were filed), which was, not inconsequentially, the same month the House and Senate passed their respective

bankruptcy reform bills.

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Consequences 01 Relorm In Small Business Cases Business bankruptcies represenc a small fraction of rotal bankruptcy filings, but the proposed legislation is expected ro have a dramatic impact on small businesses facing financial [fouble. SmaJj businesses that fiJe for Chapter 11 reorganization have six months to demonstrate they have a realistic shot of survival. Those that can't will be liquidated, with their assets distributed to creditors. As recendy reported in the Pittsburgh Business Times, the legislation also "creates so much administrative rigmarole" that it will cOSt clients morc to file for bankruptcy, said Charles Docter, a Washington. D.C., anomey who has practiced bankruptcy law for 40 years. He norcs, and many other bankruptcy practitioners agree, that six months is toO shorr of a rime for many small businesses to rake care of their problems. As a result, bankruprcy will be a much less artractive oprion. Docter advises thar small businesses should do a "preliminary reading" now on how the changes would affect rhem. "If you think you've got real reorganization potential, you can do ir outside of the bankruptcy court."

UkeIlhOOd 01 Passage Views on the likelihood that the conference committee members will be able to come up with a compromise bill that President Bush will sign vary greatly. According to Joe Rubin, director of congressional affairs for the U.S. Chamber of Commerce, which suPPOrtS rhe legislation, the differences between the House and Senate bills are smaller than they have been in previous years and primarily concern matters only "rangentially related" to bankruptcy. Unless already resolved issues are reopened, "it should be a pretty quick and painless conference," Rubin said. Notably, however, Rubin mentioned the homestead exemption as one of those issues. This issue is expected to be the mOSt contentious issue conferees will address. Proponents of the bill view Senator Joseph Siden's participation on the conference committee as a sign thar Senate Majoriry Leader Tom Daschle is serious about" passing bankruptcy reform. However, it is thought that Daschle's selection of conferees could foreshadow rrouble. Three of the Democrats, Durbin, Feingold, and

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Kennedy, voted against floor passage of H.R. 333. Dasch!e had originally planned to appoint only four Democrats, but added more at rhe last minute. Due ro the participation of several Democrats who voted against H.R. 333 on the conference committee, there is specuJation thar creating a "workable" bill will become more difficult, if nor impossible. According to Congress Dflily, Senator Leahy said that he would support the Senate-passed bill in conference and in subsequent votes. Leahy said he plans to fight in conference ro preserve the Senate provision thac would place a $125,000 cap on homestead exemptions. The Senare voted to allow debrors ro shield only $125,000 of their home equity in response to concerns that some wealthy individuals are abusing the bankruptcy system by putring their assets into multimillion dollar mansions in states such as Florida, where homes are exempt from creditors' claims. The House bill leaves homestead exemptions up to the states, unless the home was purchased less than rwo years before the debtor filed for bankruptcy. In that case, the homestead exemption would be capped at $100,000. Senators Kay Bailey Hutchison (R-Texas) and Sam Brownback (R-Kan.) voted against c10rure due to this provision. Texas and Kansas, along with Florida, are among the five states with an unlimited homesread exemption. The homestead exemption issue is "explosive," says Travis Plunkett, a lobbyist with the Consumer Federation of America, which opposes the bankruptcy reform legislation. President Bush has stated that he opposes the Senate bill's cap bur otherwise suPPOrtS bankruprcy reform. In an August 1st letter to all 19 House conferees, the Bush administration made its position clear and urged the conferees on the bankruptcy reform bill, H.R. 333, to suppOrt the HOllse version of the homestead exemption and oppose the Senate language. Specifically, the letter srates: "The administration strongly opposes the Senate passed language regarding the homestead exemption and strongly urges the conferees co return to the bipartisan compromise language that was adopted by the last Congress." Samuel Getdano, executive director of the American Bankruptcy Instirute, predicts that House-Senate conferees likely will work

our a compromise on the homestead exemption that will address the worst cases of abuse. "The stars may finally be in alignment," Me. Gerdano said, "although we've said that before." The purpose of the House and Senate bankruptcy reform bills is to reduce bankruptcy filings and increase payments to creditors. However, both bills contain a number of provisions that have the potential to impair the overall effectiveness of the consumer credit system. For example, creditors currently willing [0 cooperate in voluntary arrangements with debtors because the debtors may othenvise may me a Chapter 7 bankruptcy may be less accommodating if that avenue is eliminated. The longer minimum plan length in Chapter 13 may also increase the number of plans that default or filiI. The legislation will likely lead to greater court involvement and generate additional expense for the courts and the parries involved in the bankruptcy process. At this point, the extent to which the changes will achieve the desired goals or create undesirable results ca.nnot be fully known. What is clear is mat, if the conference committee is able to come up with a compromise bill and the President signs it, the firsr groups to benefit from the legislation will be those providing continuing legal education credit for a fee.â&#x20AC;˘

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Who are Young lawvers and what do they do;J bV TIm Cullen

Y

oung lawyers are everywhere. JUSt last week a whole new crop passed the bar exam. Young lawyers are trying cases, writing appeals. and practicing law in every corner of the srate. However, there is also another group of }'oung Lawyers. These Young Lawyers are also engaged in the practice of law. Bur what makes them differenr is that they have banded cogether to form a group to: Stimulate the interest o/young members of the bar of Arkansas in the objet" of the

Arkansas Bllr Association and to provide such younger members of the bar with n more ifftetive mean; to participate in activities directed toward Improving the administration ofjustiu and promoting the public weljitre. 1 The Young Lawyers Section does noc charge dues beyond the regular Association dues. The section membership includes all members of the Association "under the age of 36 or who shall have been admicred to the praCtice of law five years Of less."2 So what really makes Young Lawyers differem from young lawyers? AJlow me tdl you some of the differences. YtJUng Lawyas meet at leaS[ fouf times a year co condUCt their Section business. Most recendy. Young Lawyers conducted a leadership retreat in Lirrle Rock, encompassing two days of meetings, brainstorming, and social events. The Young Lawyers reviewed their activities over the prior year, and set their goals for the coming year. Young Lawyers have a longstanding tradition of helping the Bar Association put on one of the best CLE programs year in and year ouc. Mark your calendar for Bcidging the Gap, a three-day CLE program in Little Rock on November 1-3. Bridging the Gap is geared, as the name suggestS, to new lawyers. The presenters

are experienced lawyers who always give valuable insights. Bridging the Gap is also a bargain for new lawyers, with incentive pricing for recent admirrees. But even at full price, Bridging the Gap draws its share of veteran lawyers because it offers some of the best CLE programming of the year condensed into a three day format. Young Lawyer co-chairs Mark Hodge and Brenda Stallings promise this year's program will live up to its reputation. Young Lawyers have a hand in many of the handbooks and informational materials published by the Bar Association for both lawyers and the general public. Most recently. Young Laywtrs were proud of the accomplishments of Dustin McDaniel and Chris Gardner, both of Jonesboro, who took one of our handbooks for the general public to the next level. Dustin and Chris, with the help of their committee and the hard work of Dr. Robert Baum at Arkansas State University, cook the Consumer Law Handbook that the Association has published to aid consumers in basic legal issues and transactions, and translated en espanol (that's "in Spanish," and thac's the extent of my own Spanish). Conracr the Association for free copies of the Spanish Edition of the Consumer Law Handbook to have it available in your office and your community. }'aung Lawyers continue to lead the legal relief effort when disaster strikes. Former 1'Otmg Lawyers chair Baxter Sharp of BrinkJey was the leader in eStablishing a comprehensive plan for how the Bar can mobilize to help victims with their legal issues when the inevitable Arkansas tornado, ice Storm, or other disaster Strikes. Watch for progranlS coming soon that will offer basic training in how to assist disaster victims. We need your help by becoming a trained volunteer so the Bar

will have the human resources to respond in these important times of need. Ytmng Lawy~rs are particpating in Law Week acrivities in their communities across the state. Contacr Young Lawyer Elizabeth Thomas, who is chairing our Law Week comminee, to find OUf how your community can get involved with our poster and essay contests for school kids. Young Lawyer Mark Hodge and a strong group of volunteers have been active in a Lawyers for Literacy campaign at twO Little Rock schools. The Young Lawyers spend one-an-one time wich school kjds who are falling behind in reading. The program has paid tremendous benefits to the children, both in their reading skills and in the mentoring relationship they often develop with their Young Lawyer tutors. Mark has developed some materials and suggestions for how this program can be starred in other schools and communities. Contact Mark, or your local Volunreers in Public Schools office, for details on how you can help. Young Lawyer David Johnson may be calling you soon wich a question every lawyer dreads: "What is the starure of limitations for a cerrain cause of action?" David and his committee are updating the Association's Statute of Limitations Handbook to be sure it is currenr and comprehensive. Once the revision is complete, you may sleep better at night knowing thar you can find the applicable statute of limitations for most actions you might encountet in this valuable handbook. And if you find yourself spending more time on your compucer. and less time loolcing at books, you win be pleased to know thar we intend to offer the Statute of Limitations Handbook on CD-ROM.

ns SICIlIa . . . , Continued on page 56 fol.l6 110. ,111'aIl2001

1'be "rhusa! I.awler

21

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Teaching Old Dogs New Tricks: The 2000 Amendments to the Federal Rules ofCivil Procedure Change. Everyone resists it, p3rcicularly lawyers. But change we muSt if we practice in Arkansas's federal district eouns. The 1993 amendments to [he Federal Rules of Civil Procedure inrroduced profound changes ro pre-trial practice. Particularly.

"caveats" about the new methods of federal court practice in Arkansas - and maybe ease the pain of change a lirtle bit, in the process.

I. THE INITIAL SCHEDULING ORDER, RULE 26(f) CONFERENCE, INITIAL DISCLOSURES, RULE 26(f) REPORT, RULE 16 SCHEDULING CONFERENCE, AND FINAL SCHEDULING ORDER.

the 1993 amendments introduced the requirement of "initial disclosures" - the exchange. at the early stages of me case, of information regarding potential wirnesses. and the identification and production of

pertinent documents. l Coupled with me requiremclH of initial disclosures were limitations on the number of depositions and interrogatories that a parey could take and propound. 2 And pardes were further prohibited from engaging in any eype of discovery until after conferring regarding discovery needs and scheduling.3 Those amendmems also concained "optout" provisions4 that enabled each district to decide whether to reject these novel (and to some, alarming) procedures and adhere to

About the Authors Troy A. Price and Chacles L. Schlumberger are partners with Wright, Lindsey &Jennings LLP in Little Rock. Price is chair ohhe firm's Appellate Advocacy Practice Group and an honor graduate of the Universiry of Arkansas at Little Rock Law School. Schlumberge[ is a member of the firm's Retirement Plan Administration Committee and received a law degree from Vande[bil[ Universiry in 1979.

by Troy A. Price & Charles l. Schlumberger

rhe methods we all knew and were comfortable with. The United States District Courts for both the Eastern and the Western Disrricrs of Arkansas chose to opr out. In identical orders5 the courtS rejected these changes, finding them "unnecessary," "unduly burdensome," and "working an unnecessary hardship and potential increase in litigation costs on litiganrs and attorneys[.]" Both CourtS dismissed the limits on the number of depositions and interrogatories as "blindly and without consideration of the requiremems of the case ar hand, limir[ing] such discovery." Effec[ive December I, 2000, [he Rules were amended to delete the "opr-our" provisions, thereby mandating uniform compliance with the "new" Rules for everydisrricr in the coumry. Also, some of the Rules were amended to meer concerns and problems that came ro light during the prior seven years. With this article, OUI hope is ro provide useful informarion, practice tips, and a few

The purpose of the "new" rules is to establish a format by which scheduling and case management, and information central to the parties' claims and defenses, are established and disclosed at the early srages of the case. Both federal district CourtS in Arkansas have adopted a series of Local Rules to facilitate thar process. This part of the article presents, in roughly chronological order, rhe steps and deadlines created by the rules. (aJ The Initial Scheduling Order. Both of the Arkansas federal district courcs have adopted Local Rule 16.1, which requires the issuance by the Court of the Ini[ial Scheduling Order ("ISO"). The ISO is issued after an appearance is made by at least one defendant. Tip: If you represem a defendant in a multiple-defenda.nr case, you should check with the court clerk (or the Pacer docker on the inrernet) to derermine whether any of rhe other defendams have made an appearance and thus whether [he ISO has already been issued. At this time, the derks' offices are issuing the ISO only onceto rhe plaintiff and to the defendant who makes the firsr appearance. The ISO contains [he following important dates: Deadline for Rule 26(f) conference; • Deadline for Rule 26(f) repore; Proposed trial date; • Date for Rule 16(b) conference; • Dare for final scheduling order. (bJ The Rule 26(f) conference. The Rule 26(f) conference among

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counsel for the parries must be held by the deadline stated in the ISO. Usually, this will be scheduled ro occur abour 30 ro 45 days after the issuance of me ISO. Under Rule 26(d), no discovery may be conducted by any party until after the Rule 26(f) conference is held. The marrers co be discussed at the Rule 26(f) conference are set forth in Rule 26 (f) and in Local Rule 26.1 and include: The nacure and basis of claims and defenses; The possibilities for early settlement or resolU[ion of the case; Arrangements for Rule 26(a)( I) disclosures; • A discovery plan, including discovery sequence, deacUines, prOtective orders, changes in discovery limitations imposed by me rules, a.nd other marrers set forth in Rule 26(f)(I) - (4) and Local Rule 26.1; and The procedures for disclosing electronic or computer-based media, as set forth in Local Rule 26.1 (4). CAVEAT: Any objections to making the initial disclosures required under Rule 26(a)(l) must be stated both at the 26(f) conference and in the 26{f) report; otherwise, those objections are waived. Fed. R. Civ. P. 26a)(I). The typical objection is that a threshold dispositive motion, such as a Rule 12{b) motion or a mOtion to compel arbitration, will be made or is pending, and if granted would make the disclosures unnecessary. (c) The Rule 26(a)(l) disclosutes. There are eight rypes of cases that are specifically exempted ftOm the disclosure requirements. They are enumerated in Rule 26(a)(I)(E). Unless your case falls within one of those exemptions, your Rule 26(a)( I) disclosures are to be made at, or within 14 days after, the Rule 26{f) conference, unless an objection is stated at that conference and included in rhe Rule 26(f) report. (See Caveat, above.) If your parry is joined after the Rule 26(f) conference, the disclosures are ro be made within 30 days after being served or joined, absent a stipuJation or court order to me contrary. The information to be disclosed is set forth in Rule 26(a)( I)(A)-(D) and includes the followi ng: • The names, addresses and telephone numbets of individuals (other than those used solely for impeachment) having discoverable information that the disclosing party may use in support of 2·1

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www.arkhar.CII

its claims or defenses, and the subject marrcr of that information; • A copy of, or a description by category and location of, documents, dara compilations, and tangible items (other than materials used solely for impeachment) in the possession, custody or control of the disclosing parry and that the disclosing party may use in support of irs claims or defenses; • A computation of any category of damages claimed by me disclosing parry, and making available for production all non-privileged materials on which the computations are based, including materials bearing on the nature and extent of the injuries suffered; Production of any insurance policy that may provide a source of payment for any judgment, whether direct or by indemnity. TIPS AND CAVEATS: The boldfaced language marks a significam departure from the 1993 disclosure requirements. Under the original provisions, a parry was required to disclose wirnesses, documents and things which were "relevant to the facts pleaded with particularity III the pleadings." This language placed parties and their attorneys in a quandary; under the strict letter of this language arguably they were required to disclose to the opposition not only witnesses and materials that supported their claims or defenses, but also witnesses and materials that were detrimental to their claims or defenses. The 2000 amendments to Rule 26(a)(I)(A) and (B) now make clear that a parry is required to disclose only those individuals and materials that it intends to use to support irs claims or defenses. Thus detrimental witnesses and materials still must be ferreted out through traditional discovery. The disclosures must be based on information reasonably available to the parry at the time of disclosure. Rule 26(a)(l) expressly provides that disclosures are not excused for failure to complete investigation, or because other parries have failed to make their disclosures. Under Rule 26(e), A party is under a duty to supplemenr its initial disclosures (as well as expert and pretrial disclosures under Rule 26(a)(2) and (3)). • Sanctions. Under Rule 37(c), unless the failure to make Rule 26(a) disclosures is

"harmless," me undisclosed testimony or information is to be excluded from evidence. Rule 26(a)(I) disclosures are not filed with the court. (d) The Rule 26(f) report. The deadline for filing the Rule 26(f) report is contained in the ISO. The items ro be included in the Rule 26(f) report are enumerated in Local Rule 26.1 and include, among other things, deadlines for making Rule 26 disclosures (including initial disclosures and expert disclosures); any need to deviate from limits on discovery imposed by the rules (such as the number of depositions and interrogatories); any needed protective orders; sequencing and deadlines for joining parties and amending pleadings, for discovery, and for filing dispositive motions; objections to the proposed trial date; and any objections to making me initial disclosures required under Rule 26(a)(I). Again, any objection to Rule 26(a)(l) disclosutes must be made at the Rule 26(f) conference and stated in the Rule 26(f) report. The Rule 26(f) report should be a joinr submission unless me parties disagree on any points to be comained in that reporr. ln that case, separate Rule 26(f) reports should be filed. (e) The Rule 16 Scheduling Conference and the Final Scheduling Order. The ISO will include a dare for a Rule 16(b) scheduling conference, which will be scheduled on a date after the deadline for the Rule 26(f) reporr. If the Rule 26(f) report contains nothing requiring the Court'S artention or action, then the RuJe 16 scheduling conference will not be held. After the scheduling conference, or if one is not held, the Court will then issue the Final Scheduling Order ("FSO"). The FSO will contain the trial date, the deadlines for adding parties and amending pleadings, the expert disclosure deadline, the discovery cutoff, the dispositive motion deadline, and the deadlines for filing pre-trial disclosure sheets and objections mereta, exhibit lists, jury instructions, trail briefs, and findings of fact/conclusions of law. TIP: To avoid a FSO that might deviate from the parties' agreemenrs, consider preparing and submitting a proposed FSO for the Court's enrry.

II. ATTORNEYAND COURTMANAGED DISCOVERY AND OTHER LIMITS; FILING REQUIREMENTS;

(

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EXPERT DISCLOSURES, PRETRIAL DISCLOSURES, AND SANCTIONS. (a) Attorney- and Court-Managed Discovery. AnOther of the morc significant changes under the "new" rules is the distinction bccwcen anomer- and court managed discovery conrained in Rule 26(b)(l). Under that rule. the scope of discovery in which parries may engage without court supervision IS limited (Q "discovery regarding any mancr, not privileged, that is relevant to the claim or defense of any party[.]" Otherwise, "For good cause, the court may order discovery on any marter relevant to the subject matter involved in the action." Thus Rule 26(b)( I) esrablishes a dichotomy between "claim-Dr-defense" discovery and "subject matter" discovery. Unfortunately, the difference is hard to discern, and the comments to the rule offer little concrete guidance: The Committee intends that the parties and the court focus on the actual claims and defenses involved in the action. The dividing line between information relevam [0 the c1ajms and defenses and thar relevam only to the subjecr matter of the acrion cannor be derermined wirh precision. A variety of rypes of information nor directly perrinenr [0 cite incidenr in suir could be relevant ro rhe claims or defenses raised in a given action. For example, other incidems of the same rype, or involving the same product, could be properly discoverable under the revised srandard. . . .The rule change signals to the court that it has the authority to confine discovery to the claims and defenses asserted in the pleadings, and signals to the parties that they have no entidement to discovery to develop new claims or defenses that are not already identified in the pleadings." . .. When judicial intervenrion is invoked, the accual scope of discovery should be determined according [0 the teasonable needs of the accion. The coun may permit broader discovery in a particular case depending on the circumstances of the case, the nature of the claims and defenses, and the scope of discovery requested." (Emphasis added.)6 Perhaps the better way to articulate this rule change is ro say that it is designed to forestaIl overbroad, "fishing expedition" discovery that can needlessly protract a case and cause undue burden and expense to the

16

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panies. The touchstOne of the rule is the case's pleadings: the scope of attorneymanaged discovery should not exceed the parameters of the facts, claims and defenses specifically set forth in the pleadings. For example, if a plainrifFs claim against a Iawnmower manufacturer in a product liability anion is that he was injured as a result of a defectively attached blade on a specific model, attorney-managed discovery would not permit him to inquire either inro other, unrelated rypes of malfunctions with respect to that model, or inro blade attachmenr malfunctions in other models made by the manufacturer. The dichotOmy established under Rule 26(b)( 1) may well create more discovery skirmishes than it avoids. In any event, the protection is there if attorney-managed discovery becomes excessive. (b) Other limits on discovery interrogatories, depositions, and the limitations of Rule 26(b)(2). Under Rule 33(a), absent leave of court a parry is limited to 25 interrogatories "including all discrete subparts." Under Rule 30(a)(2)(A), each side in a case - nor each parry - is limited to ten depositions. Thus in multi-defendam cases, the defendants should work together 111 determining which depositions are necessary. Additionally, under Rule 30(d)(2), each deposition musr be complered within one day and may not exceed seven hours. Under Rule 26(b)(2) the Court may modify these limitarions. The panies can modify the ten-deposition limit by written stipuJation. A written sripulation or leave of the Court is also required in order to permit a parry to serve more than 25 interrogatOries. Counsel who desire to take more than ren deposirions per side or ro serve more than 25 interrogatories per parry should raise the issue ar the Rule 26(f) conference and include a repon of the panies' posirions in the 26(f) report. A parry seelcing extra interrogatories should be prepared to explain to the district judge why they are needed, and perhaps to produce the extra interrogatories for the coun's consideration, as recently required by one Eastern District judge. A lawyer who seeks extra depositions should be prepared ro identify the persons soughr to be deposed and state to the district coun what the lawyer believes will be accomplished in the exrra depositions.7 Rule 26(b)(2) also empowers the courts

to intervene and limir discovery if (i) the discovery is unreasonably cumulative ~r duplicative, or is obtainable from some other source that is more convenient or less expensive; (ii) the party already has had ample opponunity to obtain the information by other discovery; or (iii) the burden or expense of the discovery is outweighed by its value, in Ijght of the needs of the case, the parties' resources, and its imponance . the issues. (Again, query whether this... provision only invites more discovery-related litigation.) (c) Abolition of discovery filing requirements. Under Rule 5(d), no discovery materials of any type are to be filed with the COUrt. This includes depositions and interrogatories, requests for production, requests for admission and responses thereto. Additionally, the comment to the 2000 amendment ro Rule 5(d) explains thar deposition norices under Rule 30(b) and objections to written discovery are nor to be filed.' (d) Expert disclosures. Rule 26(a)(2) requires each party ro disclose any expert who may be used to present evidence under Fed. R. Evid. 702, 703 or 705. Subparr (C) of this rule srares that disclosures of primary experts must be made at least 90 days prior to trial, with rebuttal experts to be identified within 30 days after the disclosure of the primary experts. TiP: The deadlines contained in the Rule often will not mesh with the discovery plan rhe parties establish ar rhe Rule 26(f) conference. Accordingly, the attorneys should develop expert disclosure deadlines as part of that conference and include them in the Rule 26(f) report, so that they will be adopred in the FSO. Nore thar subpan (B) of Rule 26(a)(2) defines an expen to include nor only nonparry "hired guns," but also anyone "whose duties as an employee of the party regularly involve giving expert testimony." This subpart also requires a written repon prepared and signed by the expert containing the following information: • A complete statement of all opinions to be expressed and the basis and reasons therefor; • The data or information considered by the expert in forming the opinions; • Any exhibits to be used as a summary of. or suppon for, the opinions;

• The qualifications of the wimess, including all publicarions authored by the expen in the past ten years; • The compensation co be paid for the expen's services, including testimony; A lise of all eases in which rhe experc has testified at trial or in deposition for the past four years. All disclosures made under Rule 26(b)(2) are subjecr ro the supplementation requiremems of Rule 26(e)(I). OIVEAT: Rule 26(e)(l) specifies thar both expen repons and ex pen deposition tescimony are to be supplememed, if necessary, by the time that the pretrial disclosures are made under Rule 26(a)(3) (next diseussed). (e) Preuial disclosures. Rule 26(a)(3) and Local Rule 26.2 combine to establish the pretrial disclosures ro be made by each parry. These disclosures are largely the same as those that were made in the former Pretrial Conference Information Sheet that the Arkansas federal district courts used in past praerice. The FSO will establish rhe deadline for making the pretriaJ disclosures and objections thereto. 01 VEATS, Under Rule 26(a)(3), all objections [Q pretrial disclosures, including objections co the use of depositions and co the admissibility of documents and demonstrative evidence, must be made within 14 days after the disclosures, or they arc waived. The onJy exception to the waiver is for objections made under Fed. R. Evid. 402 and 403, or for other objections not made which are excused by the court from good cause. Also, any supplements co an expert repon or expen depositions are to be made by the deadline for the Rule 26(a)(3) pretrial disclosures. Local Rule 26.2 enumerates the information to be provided. Under that rule, wi messes and exhibits are to be identified in twO separate categories: those witnesses that the parry expects to caU, and those that it may call; and those exhibits that it expects to offer, and those that it may offer. (f) Sanctions. With the adoption of the "new" rules, attorneys should pay heed to rhe additional sanctions applicable under Rule 37: Rule 37(c) exposes a parry co sanctions if it fails to make the disclosures

required under Rule 26(a)(I), (2) or (3) or if it fails to supplemem those disclosures undet Rule 26(e); • Rule 37(g) exposes the parry and irs attorney to sanctions for failure to participate in the development and submission of a discovery plan under Rule 26(f). Addirionally, Rule 37(c)(I) was amended in 2000 to specifieally include sanctions for failure co seasonably amend or correct answers to prior written discovery (including requests for admission), as required under Rule 26(e)(2). CONCLUSION This article does not provide all of the information one will need in order to comply wirh the 2000 amendmenrs to the Federal Rules of Civil Procedure. There is no substitute for reading the rules (and particularly the new Local Rules) and cases inrerpreting them. Patience and lenience will be the greatest virtues as old dogs learn these new tricks. I. Fed. R. Civ. P. 26(a)(I)-(4) (1993). 2. Fed. R. Civ. I~ 30(a)(2)(A), 31 (a)(2)(A), 33(a) (I 993). 3. Fed. R. Iv. P. 26(d),(f) (1993). 4. See rules cited in notes I - iii.

5. U. S. Disl. CI. W.o. Ark. Gen'l O,d" No.

25 (Feb. 2,1994); U.S. DiS!. Cr. E. D. Ark. Gen'l O,der 42 (Feb. 22, 1994). 6. Comments, 2000 AmendmentS, Fed. R.

Civ. P. 26(b)(1), ,eprinted in FEDERAL CIVIL PROCEDURE AND RULES, (West 2001 ed.) at 157. 7. See, e.g., Bell v. Fowl", 99 E3d 262, 271 (8th Cir. 1996) (district court did not abuse its discretion in refusing fO allow additional depositions where parry did not explain need ror them or inrormation sought. 8. Comments, 2000 Amendments, Fed_ R.

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â&#x20AC;˘

Contents A Message from the President 3

Profile of the Arkansas Bar Foundation 4

Foundauon Funding 5

Commitment to Education 5

Scholarships 6

Memorial Gifts 7

Fellows of the Arkansas Bar Foundation 8, 9

Donors 10

Special Project Grants 10

Recogn izi ng Excellence I I

Board of Direcrors 12

2

A Message from the President of the Foundation Dear Fellows and Friends of the Arkansas Bar Foundation: With pride and pleasure. I presenc you the annual repOft of the Arkansas Bar Foundation for the 2000-200 I year. I hope that you will rake a few moments [0 review it. The Foundation administers 38 endowmenc scholarships with assets totaling approximately $610,000. This year we have awarded 22 scholarships to deserving law smdencs at the University of Arkansas School of Law in Fayetteville and 22 scholarships to students at the UALR William H. Bowen School of Law. We were delighted to have many of these scholarsnip recipients at our mid-year dinner. This year we have increased the number of Sustaining Fellows by 19. ftu of this writing we have 190 Sustaining Fellows whose additional contributions aid significantly in our operations. A tremendous amount of time has been spent by a joint committee of the Foundation and the Arkansas Bar Association concerning issues related to the Bar Center. The committee, acting under the wonderful leadership of Bill Bowen, Frank Sewall and Dick Williams, has been wtesrling mightily with many thorny issues of whether, how and at what cost the Bar Center will be kept and renovated. It will continue to serve the Foundation on these issues and needs the understanding and continued suppot[ of all of rhe Fellows and the Bat Association. The future leadership of the Foundation is in excellent hands with Tom Overbey, the presently serving Vice-President (and President-Designate), and Teresa Wineland, the present Secretary and future Vice-President/President Apparent. It has been a great honor to serve as your President. I believe that the Foundation has fulfiUed its commitment during the last year to support the educational needs of our universities and the improvement of the administration of justice. Accomplishment of our goals has only been possible by the outstanding effort of our board, the committees, Ann Dixon Pyle, our executive director and her assistant, Joyce Bobbitt. The board of directors and committee members have labored long and, many times, without appropriate recognition for their faithful service. We should all take time to thank them. 1 hope that you will continue to support the Foundation with your time, effort and gifts.

lliii-

Donis B, Hamilton, President Arkansas Bar Foundation

3

Profile of the Arkansas Bar Foundation THE ARKA SAS BAR FOU DATIO was established in 1958 to support efforts at improving the administration of justice. The Arkansas Bar Foundation, which is classified as a tax exempt organization under Section 50 I (c) (3) of the Internal Revenue Code, is a charitable organiz,,1tioll wim a mission ro promote educational, literary,

conference room which is frequently used by lawyers from around the state for depositions and meetings. The open lobby area is a perfect site for receptions and larger meetings. The Arkansas Bar Foundation is governed by an eighteen-member Board of Directors. The Board is composed of th ree lawyers elected by the Foundation members from each of the five bat districts plus the Arkansas Bar Association President, the Immediate Past President of the Foundation and the Chair of me Trust Committee. The Officers of the Foundation are the President, Vice President and ecretary-Treasurer, who are elected by the Board for one-year terms. Members of the Board are elected at the annual Foundation membership meeting.

scientific and charitable purposes which are more

specifically described as follows: I) To improve and facilirare the administration of justice. 2) To promote legal study and research, diffusion of knowledge of the law and continuing education of lawyers. 3) To publish and distribute addresses, reports, treatises and other literary works on legal subjects and to acquire. preserve and exhibit rare books and documents, objects of art and

items of historical interest having legal significance or bearing on administration of jusnce.

The seventeen-member Trust Committee is composed of experienced lawyers who serve sixyear terms. 1\'10 are appointed by each President and confirmed by the Board. Other members are the Foundation Officers and the Deans of the two Arkansas law schools. The Trust Committee manages me Trust Fund to generate income for the good works of the Foundation. Only interest earned on the Trust Account is used. A separate operanng account pays the cost of running the Foundation.

The Arkansas Bar Foundation funded the building of the Arkansas Bar Center, located at 400 West Markham, Little Rock, Arkansas, which has been me location of the Foundation and the Associarion since 1974. The building is wholly owned by the Foundation, but space is rented by UALR and other offices. The Bar Center has a formal

ARKANSAS BAR FOUNDATIO 400 WEST MARKHAM LITTLE ROCK, ARKANSAS 72201 (501) 375-4606 â&#x20AC;˘ (800) 609-5668

4

Foundation Funding For fiscal year 2000-0 I, the Arkansas Bar Foundation approved grams, scholarships and program allotments of benefit [0 the profession and the public. Scholarships and projects of the Arkansas Bar Foundation are financed through investment income from the trust fund which has been built by contriburions and Fellows' pledges and is used solely for the good works of the Foundation. This

ilJusrration reRects allocations for the 2000-0 I year.

...P .....- - - - - -

Awards/Recognition

1.5%

...-"'<----- Law-Related Education Programs Foundation Merit Scholarships and Foundation Professorships

11%

20.5%

Special Projects Grants

33%

Endowed Scholarships

34%

'The Arkansas Bar Foundarion's fiscal year begins on July I of each year and ends on June 30.

COMMITMENT TO EDUCATION

ARKANSAS BAR FOUNDATION

The Arkansas Bar Foundation contributes support to the two Arkansas law schools. In addition to the many endowed named law school scholarships and the Arkanas Bar Foundation

PROFESSORS OF lAW

Professor W. Dent Gitchd, UALR William H. Bowen School of Law

Merit Scholarships awarded to deserving scudems at each school, the Foundation also approved funding in the roral arnounr of $24,350 in the 2000-01 truSt budger for the following: Arkansas Bar Founcladon Professorships; Law Scudem Moot Court Competition; and, Law Review writing awards. The Arkansas Bar Foundation has established an Arkansas Bar Foundation Professorship ar the University of Arkansas School of Law and the UALR William H. Bowen School of Law. One outstanding faculty member from each school is selected to hold this designation of "Arkansas Bar Foundation Professor of Law" and receives a salary supplement upon this designation. The criteria for selection is excellence in teaching; excellence in scholarship in Arkansas Law; and, significant contributions to serving the Bench and Bar of Arkansas.

Professor Robe" B LeOar, University of Arkansas School of Law Other program allocations include funding appropriated for the Arkansas Bar Association and Arkansas Bar Foundation Annual Awards. The Arkansas Bar Foundation Trust Committee, which administers an endowment fund for the Conrinuing Legal Education (CLE) Departmenr, approved funding in the amounr of $8,430 ro be utilized to off-set COstS for three programs sponsored by the Arkansas Bar Association Conrinuing Legal Educarioll (CLE) Departmenr the Bridging the Gap Seminar; Diversity Presentations at 2001 Mid-Year and Annual Meetings; and, Basic Computer Training.

5

Scholarships Each year, the Arkansas Bar Foundation awards approximately 35 endowed law school scholarships to students at the University of Arkansas School of Law and the UALR William H. Bowen School of Law. In addition, the F.1culty of each of cwo law schools are allorted three scholarships for students who show potemial and who are deserving of financial award. These: Arkansas Bar Foundation Merit Scholarships are funded by the Foundation in the rotal amoum of 57.500 and have produced fine lawyers who otherwise may not have been able to afford the cons of law school without the Foundation's assistance. Scholarship recipients were honored at the Arkansas Bar Foundation Mid-Year Scholarship Dinner which was held at The Little Rock Club on Februaty 2, 2001.

me

UNIVERSITY OF ARKANSAS AT FAYETTEVILLE SCHOOL OF LAW 2000-2001 SCHOLARSHIPS SCIIOLAItSHII' AWARDED

Arkans:u Bar Foundation (Tn honor of Sebastian Counry Bar, U.M. Rose. Mike Gorman & Edw.ud L Wright) Arkansas Association of Women Lawyers (In honor of RUIn Huskey Brunson) J~ c. Barren BogIe路Sharp R.. A. EiIOOIl. Jr. Vince.nt W. Foster. Jr. Friday, EJdr芦lge & Clark Edward lester Horace H. McKenzie Judge John E. Miller Col. C. E. Ransick Rather, Beyer & Harper The Shackleford Scholarship Judge \Villiam Overton Justice George Rose Smith Smith, Stroud, McClerkin Dunn & Nuner David Solomon M. JdTSmrling' C. It Warner Harry P. Warner Ikmard & Bud Whetstone Judge Henry Woods Justice Thomas Clark Trimble Arkansas Bar Foundation (Merit Scholarship)

Jennifer Jackson Bar~tt

Deacon Jason Fulmer Erika. Boudreaux Glroline Curry Keith Jefferson Dar~1I Brown. Jr. Ashley L Rodgers lUy Schlogd St2cie Walrers Curtis Marsh Matthew Shepherd Kelly Keton Michael Robbins Will Jones Mary McBride John Perkins Seth Ward TelUa Mazze.1l0 Caroline Curry Holly Adee Brandon Gue Allyson Kennen Mark Lewis

UALR WILLIAM H. BOWEN SCHOOL OF LAW 2000-2001 SCHOLARSHIPS REoriENT

SatOlARSlur AWARDED

Arkansas Ibr Foundation (In honor of Sdnstian Counry Bar, U.M. ~, Mik(: Gorman & EdW:lrd L Wright) Arkansas Association of Women Lawyers (In honor ofRmh Huskry Brunson)

Guy Amsler, Jr. Bogle-Sharp Andy Adams DeLeith Gossett Jory Shodl David Duke

John H. and Ruth H. Brunson

E. Ch:ulcs Eichenbaum Amy Dunn

R. A. Eilbon. Jr. Judge John A. Fogleman Friday, EJdredge & Clark Judge J. Smith Henley Justice J. Frank Holt James H. Larrison. Jr. Edward Lester Brian MacMillan Col. C. E. Ransick Rather, ~r & Ha.rpt':r Rose Law Firm U.M.R= C. It Warner Harry P. Warne.r Bernard & Bud Whetstone Roxanne Tomhave Wilson Judge Henry Woods Arkansas Bar Foundation (Merit Scholarship) 路\Vill be awarded in the spring

Kimberly Miller Abrahm Smith James Cook Heather Ezell Chad Horner Erin Vineu Patti Stanley Leeland Jones Erika Montgomery Laun Clayton David Duke athan Morris Brandon LatK'n Robyn Allmendinger David Jones Jennifer Pierce Deanna Gnves Jonathan Ross Leslie Garren Michael Young Chad Avery Erika. Montgomery Jory Shodl Robert Walker Anne Perrigo Robyn Allmendinger Arlene Rusch Anne Perrigo Emily Abbon

Memorial Gifts Ease remember the Arkansas Bar Foundation when you choose

[0

make a memorial gift honoring a family

member, a colleague or a friend who was an attorney.

judge or a friend of the profession. Memorial gifts are recorded in the Foundation's Memorial Book and provide a lasring tribute. Memorial cards are sent by

the Foundation

to

[he family advising them of the

contribution. The Arkansas Bar Foundation also

receives gifts honoring individuals for a special event in their lives and acknowledgments are mailed for honorariums as weU.

Gifts

to

[he Foundation are deduccible for federal

income tax purposes and suppo[r the Foundation's

work in making scholarship funds available for law

students, aiding in education of the public about legal ma(rers, supporting projeccs that assist in improving and facilitating the administration of justice and funding other legally relared charirable efforts.

Contributions may be sell[ directly to the Arkansas Bar Foundation.

The staff appreciates having the

name of the family member to whom memoriaJ acknowledgments should be sent. Please feel free

to

call rhe Arkansas Bar Foundation ar (501) 375-4606 or (800) 609-5668 for further information.

Arkansas Bar Foundation 400

West Markham

little Rock, Arkansas

7

72201

· William H. Bowtn Edward Boyce Wayne Boyce Comer Boren. Jr. Thomas M. B",mh~1 Ellen B. B""dey William C. Bridgfonh Bill W. Bristow Edw:ud W Brockman, Jr. Chari" A. Brown Get21d Brown Roben L Brown · Thomas E. Brown · C. Bramley Buck e. Douglas Buford, Jr. Tom A. Bufon! · D~e L Bump'" • Dan M. Bu<g< !.any W. Burks Kevin R. Burns Riclwd e. Bud", Jr. William Jackson Butt II James A. Buttry F. Wilson Bynum, Jr. • John R. Byrd Richan! J. Byrne Roben D. Cab< , John e. Calhoun, Jr. Wonh Camp, Jr. • George E. Campbell · Claude Carpenter, Jr. Thomas M. Carpenrer Phillip Carroll Daniel R. Caner Jean T. Caner • Paula J. Casey · Roben M. Cearley, Jr. John S. Ch"l)', Jr. Sandra Wilson Cherry Lawrence E. Chisenhall, Jr. , Bill S. Clark William M. Clark, Jr. W. Dane Clay H. Murray Claycomb Hillary Rodham Climon IWph M. Cloor, Jr. Eldon F. Coffman Charles T. Coleman · Robert C. Compton Walter K. Compton , Bany E. Coplin Bt:nCore ate Coulter J. Scon Covington Kenneth W Cowart Jam" O. Cox Kevin A. Cnss • Michael H. Cr2wford Jan R. Cromwell , Jam" D. Cypen Roy E. Dan""r Jim Darr, Jr. • John A. Davis, III Sidney P. Davis, Jr. · RoIxn T. Dawson Bany Deacon , J.e. Deacon Gerald L. Delung Rebeeea J. Denison Roben L Depper, Jr. Jay W Dickey, Jr. Edward B. Dillon, Jr. · WG. Dinning, Jr. · Philip E. Dixon Roben E. Dodson Roben P. DougherI)' Darrell D. Dover James F. Dowden Ted N. Drake · Winslow Drummond • Timothy O. Dudley

Fellows of the Arkansas Bar Foundation Oucsranding lawyers in the State of Arkansas afC invited ro become Fellows of the Foundation. Upon inviration, a Fellow muSt

contribute or pledge [0 contribute an amount designated by the Foundation Board. The current financial requirement (Q become a Fdlow is a pledge of $1,500, which is payable over a three- or five-year period. Upon receipt of rhe pledge and ini[ial payme"" rhe arrorney is designated a Fellow. Afte< [he pledged contribution has been paid in full, the Fellow's piecure will be displayed in [he Hall of Fdlows in the Arkansas Law Center. This list represents the currem 536 Fellows of the Foundation as of April 30. 200 I. Those Fellows whose names are highligh[ed in bold are reeognized as newly designated Fdlows for rhe 2000-2001 year.

Sustaining Fellows Pledge paymems, scholarship contributions and other gifts are deposited into the Trust Fund. While investment income from the Trust

Fund principle funds the charitable and educational purposes of the Foundation, a separate operating accoum pays for the day co day COStS associated with administering the Foundation. In addition co rem from tenams in the Arkansas Bar Cemer. a primary source of operating funds is through Sustaining

Fellowships. Any

Fellow of [he Foundation

who comribuces $75 annually may become a Sustaining Fellow. We appreciate the support of our 190 Sustaining Fellows. Names marked with a « ... represem Fellows who were also

Suscaining Fellows as of April 30, 200 I.

Julius C. Acchione Riclwd B. Adkisson CharI" Greg Alagood · Edwin B. Alderson, Jr. • H. William Allen R. Ben Allen · Guy Amsler. Jr. E. M. Ande""n Overton S. Anderson

Philip S. Andenon • R. Keith Arman Morris S. Arnold WH. "Dub" Arnold Jess L Askew. III Virginia Atkinson E. leRoy Autrey Lawrenct H. Averill, Jr. Don~d H. Bacon Carlton Bailey F""k H. Bailey Nancy H. Bailey Kenneth B. Bairn Chari" W. Bak" James P. Baker, Jr. Roy L Bak", Jr.

E.J. Ball William K. Ball Don K. Barnes IWph e. Barnhan W. Christopher Barrier BenT Bany Sherey P. &nIey David F. Sanon RoIxrt 81non Samuel R. Baxter R. T Beard, 11I John R. Beasley Mike ikd>e Joe D. Bell Paul B. Benham, III Joe Benson Sanford L Besh<2r, Jr. Edgar E. Berhell am N. Bird Eric W. Bishop H. David Blair James B. Blair . TIm Roe Paul R. Bosson • Ted Boswell

8

Phillip J. Duncan James M. Dunn Winford L. Dunn James Trester Dyke B. Michael Easley John C. Eehols Chari" H. Eddy Don A. Eilbou G. Thomas Eisele Byron M. Eiseman, Jr. • John D. Eldridge · Don R. £Ilion. Jr. • Gro<g< D. Ellis , Jefftty Ellis • John R. Elrod WW Elrod, II • William H. Enfield • S[ephen EngsUOffi Lewis E. Epley, Jr. Roben R. • Gary L Eubanks Audrey R. Evans · Mike E\'erett Lindsey J. "'"dey Phillip B. Farris Jackson Farrow. Jr. · Oscar ff:ndler William l...ee Fergus J. Michael Finhugh Victor A. Aeming • John A. Fogleman · Julian B. Fogleman Dan Ford John F. Forster, Jr. TImothy Davis Fox Charles Frierson, III Roberr F. Fussell W Dale Garren M. Morrell Garhrighl Karherine C. Gay Martin G. GiI~rt • John P. Gill Marion S. Gill Chari" J. Giroir, Jr. W DtntGilChd · Morron Gitelman Roger A. Glasgow David M. Glover CharI" S. Goldberger Charles W. Goldner, Jr. Ray A. Goodwin athan G. Gordon • Alben G",V<S, Jr. Albert Graves. Sr. John R. G",ves Kathlyn G",,,es • Judith H. G",y , J. W Grttn, Jr. • John e. Gregg Richard E. Griffin Ronald L Griggs Marlt W Grohmrer Wayne Gruber • Michad E. H~e Milas H. H~e, III John T H~ey, Jr. • O. Wendell H~I, Jr. Don F. Hamilton Donis B. Hamilton Herman L Hamilton, Jr. Frank S. Hamlin Sruan W. H:rnkins John T. Hardin David M. Hargis John N. Harltey • David K. Harp • Searcy W Harrell, Jr. Eugene S. Harris James E. Harris Ron D. Harrison S. Reid Harrod, Jr.

Es."

• John T. Haskins • Richard Hatfield William D. Haught Claude S. Hawkins, Jr. M. S"d, Hays Donald H. H'nry Roben W, H'nry E. H. Herrod Sam Hilburn £. Kem Hirsch Riclurd W, Hobbs William H. Hodg< Da';d A. Hodges H'nry Hodges IUnraster Hodges, Jr. Cunis E. Hogu' A1ict L Holcomb • Cyril Hollingswonh · Don Hollingswonh Bill R. Holloway M.J~ Holmes • Jack W, Holr. Jr. · Robert M. Honell · Jcnniffer M. Horan Manhew Horan RolKn E. Hornberger Phillip D. HoUi

Dorolhy Y. Howard FJ. How,lI, Jr. D. Michael Huckabay · Clint Huey Don R. Huffman · Annabelle Clinton Imber Randall W. Ishmael Hermann Ivester

oDonald 1: Jack, Jr. John H. Jackson Randolph C. Jackson Sherry Jackson Abron Jennings, Jr. Alston Jennings • Bradl'}' D. Jesso" John M. Jewell · W Horace Jewdl • GI,nn W, Jones, Jr. Louis B. Jones, Jr. M. Samuel Jones, III Roben L Jones, Jr. Robert L Jones, III W. Wilson Jones Jim L Julian • Eug<n' K'lI'}' • Will~m H. K,nnedy, III · J.L Kidd, Jr. • Judson C. Kidd John . Killough • )os<ph E. Kill"'trick. Jr. • Warren O. Kimbrough • Mike Kinard Donald K. King Harold L King Knox B. Kinney John S. IGnuman · Peter G. Kum pe H. Baker Kurrus

Stanl'}' R. Langl'}' • Da';d N. las<r Sam lasc:r · John T. La"')' • Ik, AlI,n Laws, Jr. Leland F. Leatherman Charles R. l.<dberter

Thomas D. Ldlxttc:r Roben BLdlar Markham Lester

Stark Ligon Gary F Liles · Ruth Lindsg W, Kirby Lockhart Floyd J. Lofton J. Hugh Lookadoo, Jr.

Edwin L Lowther. Jr. Parry W Lueken James M. Luffman Diane S. Mackey Edward S. Maddox Phil Malcom Howard L Martin Richard L Martin William A. Marlin Micluel H. Mashburn Terry L Malhcws Charles D. Manhcws • Da';d R. Manhcws · Stephen A. Marthews • Ronald A. May • S. Hubert Mayes, Jr. R;chard L Mays Robin L Mays · Eugen( J. Mazzanti Hall McAdanu, III • Herbert H. McAdams, " • A. D. McAIlislcr, Jr. • Austin McCaskill James E. McClain, Jr. Hayes C. McClerkin Sidn'}' H. McCullum Ed W, McCurkl, Bobby McDaniel Lucind2 McDaniel Harry E. McDermon, Jr. Robert McHenry Marcia Mcivor • James H. McKenzie o James A. McLarty, "I James Bruce McMarh o Phillip H. McMalh Sidney S. McMath Toney D. McMillan • Jack A. McNull)' D. L McRa, Margaret B. Meads · Russ Meeks David F. Menz · H. Maurice Mitchell • Michad W, Mitchdl Roben Moberly Mark A. Moll Edward O. Moody o James M. Moody Charles Mooney · D,,,,'}' Moo"" Jr. · Harry Truman Moore James L Moo"" III · James W Moore John B. Moo"" Jr. R;chard N. Moo"" Jr. • Charks A. Molgatl Stephen E. Morl'}' · Kenneth R. Mourton · Rosalind M. Mouser • Wm. Kirl>y Mouser l.«). Muldrow Walter A. Mumy Richard S. Muse Ronald G. Naramo", Oily Neal E. Sh,ffi,ld ,Ison Charles R. 'estrud David Newbern Georg' H. Niblock Raymond L. Niblock Wyck Nisbcr, Jr. R. Gary Nuner Mike A. O'Brien Bobby l.« Odom Conrad T. Odom Richard P: Osborne · Thomas L. Overbey Charles C. Owen William LOwen Michael O. Parker

Nicholas H. Patton William L Panon, Jr. Richard L. P,d Edward M. Penick Bill Pcnix Samuel A. Perroni Donna C. Pettus E. Lamar Penus orwood PhiUips John M. Pickrn Georg< E. Pike, Jr. John M. Pittman Charles E. Plunkett Oddl Pollard David M. Powell Donald E. Pl<Va1I" William I. Pl't't'o'm David H. Pryor Thomas B. Pryor · Donald C. Pull,n Stevtn W. QuauJebaum John W, Raines Michael R. R:Unw:l.ler · Louis L Ramsay, Jr. • Richard L Ramsay C.E. Ransick · Brian H. Ratcliff Gordon S. Rarher, Jr. · J. Thomas Ray · rephen M. Reasoner · David Rees Richard A. Reid James R. Rhodes, III Ben E. Rice o Elron Ao Ri<v<s, Richard W, Roachelt Andree L. Roar John B. Robbins Mark Robens Susanne RobertS Thomas E. Robertson H. Clay Robinson Robert L Robinson, Jr. SJXncer F. Robinson Judilh Rog,,, • Charles B. Roscopf • Charles D. Roscopf · Louis Rosen Jdf M. Roscnu,ig Roben D. Ross Robert R. Ross 8<v<rly A. RowIcrt E1sijane T. Roy Kent J. Rubens H,rI><n C. RuI" III Donald S. Ryan

· ·

· ·

·

"I

· ·

· • ·

JoE. Sand", Danid K. Schicffier

• • •

• ·

9

Eugene L SchiefRer Don M. Schnipper Isaac A. Seon, Jr. Mary Davies Scott Frank B. Sewall Dennis L Shackleford John M. Shackl,ford, Jr. John K. Shamburger James B. harp Sleph'n M. Sharum Jo L. Shaver, Jr. J. Michael Shaw Kenneth R. Shemin William F. Sherman Seou)' hively Robe" hullS St(\,(n T. ShultS Harold H. Simpson, II James Marlon Simpson, Jr. Jack Sims Ted C. Skokos Howard L Slinkard Bcrl A. Smilh

· · · · · • •

· • · ..

Donald H. Smilh Douglas O. Smilh, Jr. LaUr:l H. Smith Ray S. Smilh, Jr. Roben D. Smith, III Frank Snellg""" Jr. lnvid Solomon Thomas E. Sl"'rks James V. Spencer, III James D. Spron Wilton E. Srmi Gal, B. Slcwan Jean D. Slockburg<r William M. Stocks Thomas S. Stone O.H. Sto"')', III Thomas S. Sl1tttnUn Joseph A. Srrod, John F. Suoud, Jr. Paul Sullins William H. Sutton 1imothy R. Tarvin Rex M. T,rry William L Terry lee Thalheimer Marvin D. Thaxton Hoyt Thomas Roben F. Thompson Ray Thornton Danny Thrailkill Thomas P: Thrash John R. Tisdal, Win A. Trafford Robert D. Trammell N. Walls Trimbl, Edgar J. Tyler Fred S. Ursery David B. Vandergriff A. Glenn Vasser Roben C. Vittitow Eddie H. Walker. Jr. w,). Walker James R. Wallace larry C. Wallace G. Chris Walrhall C. R. Warner, Jr. John J. Watkins Fr:lnk L WatsOn, Jr. John Dewey WatsOn TImothy F. WatsOn, Sr. James E. West Bud B. WhetStone Frank B. Whilb<ck Frank L Whilb<ck Norman Wdkinson Chris E. Williams Richard A. Willianu Roben H. Williams W, Jack Willianu, Jr. J. Gaston Williamson Ralph E. Wilson Robert M. Wilson, Jr. William R. Wdson, Jr. Russell 8. Winburn Teresa M. Wineland Carolyn B. Witherspoon Tom D. Womack H'nry Woods Jo< D. Woodward Richard H. Wootton Jacqueline S. Wrighr Robert R. Wright, III Susan W,bbet Wrighl Terry F Wynn' W. Kelvin Wyrick Cary E. Young Damon Young H. David Young Paul B. Young Roben E. Young

Donors The Arkansas Bar Foundation acknowledges with grateful appreciation the receipt of memorial gifts. scholarship comribuejons, honorariums and ocher donations

(0

the Foundation during the 2000-

200 1 year. This list represents gifts. not including pledge or suS[aining fdlow paymems, received from July I, 2000 through April 30, 200\. We thank you for your support.

William A. Marcin

Arkansas Association of Women Lawyers W. Christopher Barrier Judge Ellen Bramley Cathi Compton Jack C. Deacon

Doyle and Dana Mayton Judge James M. Moody Marjorie Niblock Donald L ParkÂŤ, II, P.A. Edward and Evelyn Penick Hoyte and Ann pyle Rebsamen Insurance Judge John and Marietta Stroud. Jr. judge William R. Wilson, Jf. Mark Wilson Wilson & Associates, PLLC Judge Henry Woods

Winslow Drummond

Hden L. Eichenbaum Oscar Fendler Justice: John A. Fogleman Martin and Betry Gilben John and Marjem Gill Judicl1 Gray Richard F. Hatfield Hyden, Miron & Foster, PLLC L. R. and Peggy Jalenak

Paul and Marcella Young

Special Projects Grants The Arkansas Bar Foundation provided special projects grants [otaling approx.imately $41,000 to programs during the 2000-0 I year. Funding for che following legally rdaced projects represents the Foundation's commitmenr to its educational and charitable mission to improve the administration of justice. Lrn1.E ROCK MUNICIPAL CoURT, 1ST Small Claims Mediation Program

NORTH

DMSION

$ 6,400

OZARK LEGAL SERVICES Purchase and distribution of 200 1 suppl<rnents to the Povmy lAw Practict Manual [0 pro bono volunteer attorneys

$ 3,820

ARKANSAS VOLUNTEER U.WYERS FOR THE ELDERLY

$ 6,500

Purchase and distribucion of 200 I supplements to the Povmy lAw Pracrict Manual to pro bono volumeer attorneys

$ 9,600

ARKANSAS BAR AssOCIATION

Funding for "Scholarly Portrayal of Thomas Jefferson" for Annual Meecing program

$ 5,000

DECISION POINT, INC.

Washington Couney Drug Treacmenc Cout[ REsOURCE CoORDINATION AND TRAINING UNIT FOR ARKANSAS LEGAL SERVICES

Arkansas Research Scudy of Legal Services Accessibiliey

10

$10,000

Awards RECOGNIZI G EXCELLE CE 2001 Annual Awards These awards are given jointly by the Arkansas Bar Foundation and Arkansas Bar Association and presemed during the annual bar meeting in Hor Springs. Abov" L to R: judg, W H. "Sonny' Dillahunty, jim L. julinn, Michna H. CrnwfOrd nnd judg, Andr" L. Ronf

OUTSTA D G LAWYER AWARD Judge W:H. "Sonny" Dillahunty Given in recognition of excellence in the practice of law and out5canding contributions ro me profession.

OUTSTANDING LAWYER-CITIZE Jim L. Julian

AWARD

For recognition of outstanding participation in and excellent performance of civic responsibilities and for demonstrating high standards of professionaJ competence and conduct.

C. E. RANSICK AWARD OF EXCELLENCE Michael H. Crawford Given in recognition of extraordinary service

to

the legal profession.

OUTSTANDING LOCAL BAR ASSOCIATIO Recognizing oucscanding activities which enhance the position and standing of the legal profession.

Pulaski County Bar Association Sebastian County Bar Association Union County Bar Association ARKANSAS BAR ASSOCIATION/ARKANSAS BAR FOUNDATION PRESIDENTS' SPEClALAWARD OF MERIT Judge Andree L. Roaf

ARKANSAS BAR FOUNDATION WRJTING AWARDS

Legal Writing

General Writing

Leon Holmes "Pitfalls of the Appellate Practice: Avoiding the Serbonian Bog" The Arkomas Lawyer Summer, 2000

Elizabeth Andreoli "Consent to Medical Treaunent: The Right to Have Peace of Mind" The Arkomas Lawyer Spring, 2000

The comems of this reporr reflect activities of the Arkansas Bar Foundation from July 1,2000 through Apri130, 2001. II

Board of Directors 2000-2001 OFFICERS President Vice President Secretary. Treasurer

Donis B. Hamilton

Paragould Lirde Rock £1 Dorado

Thomas L. Overbey Teresa M. Wineland

EASTERN BAR DISTRICT 2001 2002 2003

Donis B. Hamilmll

Paragould Batesville Jonesboro

John C. Gregg

Lucinda McDaniel

WESTERN BAR DISTRICT 2001 2002 2003

Donald C. Pullen Ike Allen Laws, Jr. David B. Vandergriff

Hot Springs

Russellville Fort Smith

CENTRAL BAR DISTRICT 2001 2002 2003

Sreven T. Shults Thomas L. Overbey

Litde Rock Linle Rock Litde Rock

Tim Boc

SOUTHERN BAR DISTRICT 2001 2002 2003

William Kirby Mouser Ed W. McCorkle

Teresa M. Wineland

Pine Bluff Arkadelphia £1 Dorado

NORTHERN BAR DISTRICT 2001 2002 2003

Katherine C. Gay Martin G. Gilbert

Fayeneville Bentonville

Timothy R. Tarvin

Fayetteville

EX-OFFICIO Bradley D. Jesson, Immediate Past President, Arkansas Bar Foundation Charles B. Roscopf, Chair, Trust Commince Ron D. Harrison, President, Arkansas Bar Association

ARKANSAS BAR FOUNDATION COMMITTEE CHAIRS Trust Charles B. Roscopf

James B. Sharp

Audir David M. Powell

Special Projects John F. Stroud, Jr.

Building Russ Meeks

ABF/ABA Joint Building Task Force William H. Bowen

Awards Donis B. Hamilton

Writing Awards Victor A. Fleming

ABF/ABAJoint Planning & Design Frank B. Sewall

Investment

FOUNDATION STAFF Ann Dixon Pyle. Execmive Director Joyce Bobbitt, Administrative Assistant

AStitch in nme: Secured Lending Under Revised Article 9 I. OVERVlEW A. Purpose - Revised Article 9 to the Uniform Commercial Code ("RA9") is intended (a) to expand the types ofcollateral which may be encumbered pursuant to its terms, and (b) to simplify and clarify the rules for creating and perfecting those security interests, as well as those with regard to filing, enforcemenr and priorities. B. Method - It does this nO[ with isolated amendments, but with a wholesale rewriring of Article 9 its definitions section is 15 pages long, it conrains many provisions formerly found in Article 8, there is an additional section, and the section

direct. Perhaps a future General Assembly will remedy this oversight.

numbering is differenr in many places.

C. Scope - This article deals with the steps your lender client (Bank) will need to take CO maintain its secured status as to personal property collareral after the July I, 2001 effective date of RA9, particularly through the transition period permincd by RA9. It focuses primarily on (1) continuations of existing loans; (2) curative requirements for certain of those loans needing attemion regardless of concinuationj (3) documentation Issues for new loans intended to comply with RA9 afrer July I, 2001. including filing requirements and offices. forms, and collateral; and (4) the new default and repossession rules.

About the Author

r----=-=-=--,

Chris Barrier IS a

graduate of Hendrix College and Duke University School of Law. He practices at the Mitchell Williams law firm in Litrle Rock where he has served as chair of the firm's Business Practice Group.

bV W. Chrislopher Barrier D. Assumptions - It assumes that the security for the Bank's existing loans with which we are dealing has been perfected by filing, possession or control, and that few, if any, of its signifkant collateralized loans fall outside those three perfection methods. Nonetheless, it points out types of collateral and transactions that previously were excluded from coverage by the UCC. bur are brought within its scope by RA9. E. AgLending Issues - Ir deals specifically with typical agricultural loans and requiremems specific to that category of loans. Arkansas will remain one of the few states, if nor the only state, which preserves local county filings for agricultural loans made under the UCC. Arkansas agricultural lenders would have been better served had Arkansas adopted the Model Provisions for Production Money Priorities proposed by the drafters of RA9. which are clear and

II. CONTINUATIO S. A. Fact Pattern - Assume a loan closed December I, 1996 made TO an Arkansas corporation secured by a chattel mortgage and financing Statement on restaurant equipment. Financing statements were filed with the Circuit Clerk and with the Arkansas Secretary of State. It is now time to file a continuation statement. This transaction remains subject to existing Article 9 and RA9 as well. Using the new forms (which should be absolutely standard in all states adopting RA9), the Bank merely needs [Q file a conventional continu.ation statement with the Arkansas Secretary of State, but not with the Circuit Clerk. The same procedure is applicable if the borrower is an individual and a resident of Arkansas. If it is a general partnership organized in a state with no organizational document filing requirements, and the chief executive office is in Arkansas, me procedure is the same. B. "Birth" State Continuation Filings - If the borrower is a corporation, LLC, limited partnership or other entity whose organizational docu.ments must be filed, the continuation needs to be filed with the Secretary of State in its state oforganiZl1tion, even if no original were filed there. If that is the case, the Bank will continue its lien by filing a typical UCC-I, including a collateral description, but one which also references rhe earlier filing and the pllrpose of

rhe current filing. If, for example, the borrower is a Delaware corporation with its chief executive office in Arkansas County, the original financing statement filings likely would have been made with the Arkansas Secretary of State and also the Arkansas County Circuit Clerk's UCC records. The

l'el.16 SI. ,1/1'aIl1001

Ue .Irkaml Lawyu

19

continuation sratement (as described above)

co/lntern! af'er July I. 2001. Filing or non-

will be filed neitlur of ,hose offices. bu,

filing can also trigger the one year rule if RA9 requires filing for a category of collateral, but existing Article 9 did not, the unfiled creditor has a year ro remedy that.

instead with the Secretary of State of De/awar~.

C. 'When To Act - These transitional steps, in the vast majority of cases, will be taken in response to the Bank's tickler system reminding its employees to prepare and file a continuation seatement for a particular loan, nor as a result of a review of every existing Bank loan. And in fact, RA9 preserves the effectiveness of existing filings until a continuation is needed, rom if those filings would be in the wrong state had they

B. Deb'or Name Issues - Whether filed as a continuation seatement or as an initial

filing. the filing needs co comply in all respects with RA9 for instance, in addition ro correct terminology, the borrower's legal name must be seated correctly and spelled correctly, not using an assumed name or nickname. This is important because, if a

later computer search does nor pick up the Bank's filing, it is as if ir had never been

filed. And ,hat depends on the senrch logic used by that particular office if, for example, the Bank's borrower is "Excell Elevators" but the Bank inadvertently pues in "Exell Elevators" in the name box, it couId be picked up in some states and not in others. So, make sure you have verification of the correct name from a public filing, not just

lerterhead or phonebook. If the debror is a

mISt

with

a nllm~,

use

been filed .Frer July I. 200 I. CURATIVE DRAFTING.

III.

FILINGS

A D

A. Collateral Descriptions - There are,

however, instances where the Bank will need act prior to July I, 2002, even if its loan were closed and filing made, for example, on

ELECTRICAL ACCIDENTS

to

April I. 200 I. RA9 does nor permit generic, overbroad descriptions in security agreemems, such as "everything Borrower owns" (unless that happens to be correct), or "all of Borrower's securities accoums" (even if that is true), even though the financing statemcm can be more general than the security agreement it evidences. The security agreement must at least use the cllugon·ts described in the Code, such as aCCOUI1(S, equipment, and general intangibles," and if the existing agreement does not conform to those requirements, it must be corrected or it may become ineffective. Perhaps more seriously, if the security agreement or financing statement does nO[ specifically include and describe certain collateral because it was previously nor subject (Q Article 9 such as commercial bank accounts, commercial torr claims, certain insurance proceeds, or license fees the documents mllst b~ Ilm~ndrd to include them within the year, or an intervening creditor may step in and obtain priority as to those categories of collateral. In new filings, a list of categories should be followed by "as currently or hereafter defined." As a practical matter, many lenders use tile same description in the security agreement as in the financing statement, which is a safer approach, bur, again the issue is whether the collateral description srill matches the incended

lO

rhe ,Irkmas Law)lr

w"w.arkhar.rlm

Paul D. Mixon, PhD., P.E. Engineering Consultant P.O. Box 3338 State University, AR 7467

(870) 972-2088

(870) 972-3948 FAX

mixon@nava·o.astate.edu

Electrical Accident Investigation and Analysis, Contact Cases and Electrocutions, Electrical Injuries, Property and Equipment Damage, Electrical Fires, Safety Codes (NEC, ESC, UL), Expert Witnessing for Plaintiff and Defense Related Cases.

Accountant/Economic Analysis • Business Valuations • Personal Injury Damage Analysis • Divorce (Property & Child Support Issues)

Court-Appointed. Regular Court Appearances Richard L. Schwartz

Certified Public Accountant Certified Business Appraiser Certified Fraud Examiner

11510 Fairview Road, Suite 100 Little Rock, AR 72212-2445 Phone: (501) 221-9900 Fax: (501) 221-9292 email: schwartz@busvalu.com

that name the way it is S[ated in the document creating it. If it is a trust withom a nnm~ (a relative rarity), use the trustee's nallle in that capacity. What about individuals using nicknames, their middle name and first initial? RA9 is not crystal clear, but, as a general rule, be as precise as possible Buddy Wiggins should be Wiggins, John Robert. k a practical maner, the Bank will want to use the staturory form because filing officers cannot refuse it and it discourages errors, but it really does not easily accommodate DBk or nicknames unless inserted as an "additional debtor." The Bank may want to keep a photocopy of an individual borrower's Social Security card in its file, even if it doesn't fill in the number on the form. It can do the same with drivers' licenses, but licenses are clearly less reliable sometimes nicknames show up on them. e. Third Party CoUateral Holders - If the Bank has perfected by possession through a third parry bailee and has only notified the bailee rather than having it ncknow/~dg~ the Bank's interest (somewhat in the way life companies acknowledge IIlsurance assignments), il will nud 10 g~t th~

ackllowkdgmmt within tlu

OIU

y~ar

pmod.

Likewise, if a borrower has assigned to the Bank a significant breach of contract claim as part of its collateral for a line of credit, which is made subject to the Code by RA9, a financing statement needs to be filed in that one-year period describing the claim with some specificity. D. When To File - Filings done before July 1, 2001 which complied with RA9 automatically became effective when RA9

did. For example, if the Bank closed a loan on June 25, 200 I with a borrowet that was a Delaware corporation with irs chief executive office in Arkansas, it could have gone ahead and filed in Delaware instead of (or in addition to) Arkansas, rather than w3J(Jng. This is also relevant with reference to categories and terminology. Since "instruments" can be encumbered by a filing under RA9, including that term in a pre-7/1/01 filing worked to perfect on instruments described in the security agreement on the effective date. Likewise. since the term "accounr" is somewhat broader under RA9, including it in a preeffective date filing when the security agreement clearly includes within the term collateral such as license fees (which were a general intangible until July I) was effective.

borrower farms. RA9 deletes old Section 9312(2) (including 9 312(2)(f» and does not really replace it with a specific agricultural lending provision. It makes sense ro read RA9's provisions on purchase money security interests and inventory financing (new Sections 9-1039(b), 9-322 and 9-324) as giving a lender who finances the production of a crop that preferred status if they follow the same procedures, but RA9 could certainly be clearer in that regard and pre lending lien searches and subordinations will be more important than ever. The revised article does clarifY that the borrower need only be "engaged in farming operations" with respect to the property pledged, rather than being an actual "farmer," and thar aquaculture is a subcategory of agriculture.

v: MISCELLANEOUS ISSUESI Iv. TYPICAL AG WAN REQUIREMENTS. Typical agricultural liens under RA9 do not require much adjustment in thinking or procedures, but they do require some. Under RA9, a security interest in crops growing on real estate which is perfected by filing in the same manner as is utilized currently will take priority over any conflicting interests of a real estate encumbrancer. Production money security interests (as nored, a term lamentably absent from Arkansas's version of RA9) and traditional landlord's liens are now treated like any other extension of credit filing is "qui"d 10 P'rfil'. RA9 does nOt appear to requite legal descriptions for any of the crop lien filings, but they should be used whenever possible, and filings made in every county where the

A great way to find the right klwyer for you! Log Onto the Internet and go to www.arkbar.com. Then, you're JUSt a click away from arkansasfindalawyer.com A direcrory of participating attorneys, fr~ and available online,

anytime, COUrtesy of the Arkansas Bar Association 400 W Markham· Little Rock, Arkansas 72201 Phone 501-375-4606 • 1-800-609-5668 • Fax 501-375-4901

QUESTIONS. k alluded to above, there simply are a number of provisions in RA9 which, while generally helpful to lenders, will require conceptual and procedural re-thinking: A. Signatures - In what may be the most dramatic change in Article 9, RA9 substitutes "authenticated record" for "signed writing" for almost all purposes, allowing acceptance of commitments, acceptance of extensions, and almost any other act usually done with a signed writing to be done by fax, email or similar expression of consent. The new form of financing statement can 'I be signed. If the security agreements says the lender can sign for the borrower, it can. And, if the security agreement simply calls for filing and perfection, the lender automatically has the right to cause those things co be done. with no signatures at all. B. Accou.nts RedefIned - "Accounts" traditionally has encompassed money due from the sale or lease of goods or provision of services, other rights to payments being general intangibles. Under RA9, almost all other "payment obligations" become accounrs---license fees, payments for leases of software, insurance premiums or commiSSions, lantry winnings, payments due for energy, and credit card receivables. However, payments under a loan participation do not, hence. no filing is required to perfect the participants' rights. e. Floor Plan Lending - The substance of

I'll ~ ll. ItPl1l ttli

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11

the provisions with regard to inventory,

especially with regard ro floor-plan lending, are basically unchanged, although RA9 does make some helpful clarifications with regard to cash proceeds of sales of inventory. D. After-Acquired Torts - However, an aner acquired property clause simply cannot apply to commercial torrs since they cannot

be adequately described until mey actually arise. (This type of collateral is too rare to warram an extended discussion, but think in terms of copyright infringemem.) E. Instruments - Promissory notes (and other instruments, which, definitionally, never includes credit card slips) can be assigned and a security imerest perfected by filing. However, a creditor perfecting by possession will prevail over a fLIer, and both will prevail over a judgment creditOr seeking to levy on the nme. This same three-part priority system also applies to investment property (substitucing control for possession), and negOtiable equity securities. However, "supporting obligations" (such as guaranties) follow the debt obligation, and do nOt require possession or perfection.

F. Control Agreements - The concepr of control utili7.ed with reference to investment property, such as brokerage accounts, has been extended for non-consumer loans to deposit accounts. In particular, the Bank can perfect a security interest in a borrower's deposit account at another bank, using a control agreement, which should also waive that bank's right to set-off. Of course, deposit accounts subject to one creditor's comrol agreement may contain cash proceeds relating to collateral of a second creditor. In that instance, the control agreement creditor has priority. Hence, the second creditor may want to require deposit of proceeds into a specific account, as to which the lender has agreed nor to accept comrol or exercise set-off. One other cautionary nme: deposits of proceeds into lock-box accounts (as with asset-based line of credit loans) must be

either used to pay down me debt or be returned to the debtor that's not the way to

perfect on cash. Pledges of lerur ofcr<dir rights must also be perfected by a control agreement.

Physically holding the letter of credit is not enough. For all types of control agreement perfection, which now includes commodities accoul1ts, you can still have

11 Tke ,lrkllllll,IW!er

www.ukhu.u'l

more than one, bur under RA9, they no longer stand on equal footing, bur rather first in time prevails. Sinc~ it is a pr~unt ~ncumbrana. a contractual ucurity inurNl will p"vail ov~r lh~ c/ainu of a bankn,ptcy tTustu mor~ urrainly than a m~u right to s~t­

offwill. G. HeaJth-Care-Insurance Receivables, UC Rights, ECP - While insurance has genetally been excluded from Article 9,

dealing with default. A- Secured Party's Options After Default - Upon default by the debtOr, the secured party can take possession of or comrol over collateral, bur cannot breach the peace in

doing so. 9-503; Rev.9-609(b); Ark. Code Ann. 4-9-609(b). A secured party can collect collateral from account debtors and

mose obligared on the instruments ( 9 502; Rev. 9607, Ark. Code Ann. 4-9-607); sell

"health-care insurance receivables" can now

or retain the collateral to satisfy the debts (

be encumbered under RA9. like any other

9-504 and 505; Rev. 9-610 and 620; Ark. Code Ann. 4-9-610 and 620); or judicially

paymenc obligation. Likewise. letter of credit rights (but, not the right to draw on one) can be encumbered, as can electronic chanel paper (as rare as it may be in the Bank's normal operations). H. Bond Issues - Governmental obligations which were previously excluded from Article 9 are now included in RA9, to the extent nO( covered by a specific statute. I. Free Transferability - Existing Article 9 generally renders ineffective prohibitions against pledging accounts as collateral, and RA9 strengthens those prohibitions in the interest of free transferability. It also makes it clear that assuming debtors step completely into the shoes of their seller-assignors. J. Name Changes -If a borrower changes its name so as to be misleading (according to

the applicable search logic), collateral acquired four months after the change may

be free of the perfected lien. So, a new UCC-I filing may be required in the new name. If a Delaware corporacion re-domesticates to Arkansas, the resulting entity is normally a "new" debtor, bur, if the surviving emity uses essentially the same name, the one-year rule can apply. However, the loss of the lien on subsequently acquired collateral may also occur. K. Termination of Financing Statements Since there are penalties for failure to terminate financing statements when the

Bank has been paid off, obviously it will need to make sure its tickler system is active and accurate.

foreclose on the collateral pursuant to local

procedures (9501(1); Rev. 9-601(f); Ark. Code Ann. 4-9-60 I (f». i. Colkction: A secured party's collection remedy is expanded and clarified by RA9. Under Rev. 9-607(b) (Ark. Code Ann. 4 9607(b)), a secured party that is an assignee of an obligation secured by a real estate mortgage has the right to become the mortgagee of record upon the debtor's default in order to foreclose nonjudicially on the mortgage. A secured parry can also receive and apply against the secured debt funds in a deposit accoull( over which the

secured party has control. Rev. 9-607(a)(4) and (5); Ark. Code Ann. 4-9 607(a)(4) and (5). Finally, a secured party can also deduct its collection expenses for collections made in a commercially reasonable manner. Rev.

9-607(d); Ark. Code Ann. 4-9-607(d). ii. Dispositioll: A secured party may sell or dispose of the collareral by a "commercially reasonable" public or private sale, applying

me proceeds to satisfy me debt. 9-504; Rev. 9-610 and 615; Ark. Code Ann. 4-9-610 and 615. The obligation of commercial reasonableness cannot

be waived by the

debtor. 9-501(3)(b); Rev. 9-602(7); Ark. Code Ann. 4-9-602(7). RA9 furmer defines aspects ofdisposition and provides additional protection for other interested parcies. A secured party may

dispose of collateral by license (Rev. 9610(a); Ark. Code Ann. 4-9-610(a)), may disclaim or modify disposition warranties

(Rev.

9-610(e)), and

must provide

notification of disposition, if required, to all

VI. REMEDlF.S/REPOSSESSION. As much of the litigation under old Article 9 arises in the enforcement of a security interest, RA9 was drafted to resolve pasr disputes. The following revisions, while

lienholders of the collateral disclosed through a uee search (Rev. 9-611(b), (c), and (e); Ark. Code Ann. 4-9-611(b), (c), and (e». In commercial transactions, ten

not foolproof, should provide the flexibility

(10) days prior notice of disposition is considered to be per se reasonable. Rev. 9-

and effectiveness that your Bank needs in

612(b); Ark.

ode Ann. 49-612(b).

For commercial and consumer transactions, RA9 provides "safe harbor" disposition notification forms. Rev. 9-613 and 614; Ark. Code Ann. 4-9 612(b). There is also a tide clearing mechanism that provides a transfer of record of titled collateral to a purchaser at a foreclosure sale. Rev. 9-619; Ark. Code Ann. 4-9-619.

iii. Retention of Collaural to Sntisfj Secured Debt: Old Article 9 allows a secured party ro retain collateral in satisfaction of a secured debt, subject to written notice and objection procedures. 9-50 I (3)(c); 9-505(2). RA9 rerains and modifies this remedy. First, a secured party in a commerciaJ transaction may retain collateral to satisfy a secured debt even when the secured parry is not in possession of the collateral. Rev. 9 620(a)(3); Ark. Code Ann. 4-9-620(a)(3). The notification by the secured parry of intent to retain the collateral in satisfaction may be an "authenticated" notice, rather than written, and the debtor may object in 20, nor 2 I, days. Rev. 9-620(a) and (c); Ark. Code Ann.-9-620(a) and (c). As with old Article 9, the debtor may waive its rights to notice or agree to retention. but only after default. Rev. 9-602(10); Ark. Code Ann. 49-602(10). The secured party is obligated ro inform other secured parries and lienholders of records of its intention to retain the collateral. Rev. 9-62 I; Ark. Code Ann. 4-9621. If the debtor, other secured party, or lienholder makes a written object to retention. the secured parry does not have ro dispose of the collateral, but it cannot retain the collateral ro satisfy the secured debt. Rev. 9-620(a)(4); Ark. Code Ann. 4-9620(a)(4). Under RA9, the secured party may now retain the collateral in partial satisfaction of the secured debt only in commercial (not consumer) transactions. Rev. 9-620; Ark. Code Ann. 4- 9-620. The process of retaining collateral in satisfaction wilJ not be recognized unless the secured parry takes the affirmative steps required in Rev. 9-620. Rev. 9-620(b); Ark. Code Ann. 4-9-620(b). Consistent with old Article 9 is the prohibition on retaining collateral in satisfaction with certain consumer goods where a significant pan of the purchase price of certain consumer goods has already been paid. Rev. 9-620(e); Ark. Code Ann. 4-9620(e). B. Application of noncash proceeds - If a

secured parry receives noncash proceeds (defined at Rev. 9- I02(a)(58Âť through the process of collection or disposition. the secured parry may value these proceeds and apply them to the debt in a commercially reasonable manner. Unless the secured parry's failure to value and apply such proceeds to the secured debt is commercially unreasonable, the secured parry may reduce and collect or dispose of the proceeds, as RA9 collateral. until they have been converted to cash for application of the secured debt. Rev. 9-608(a)(3) and 615(c); Ark. Code Ann. 4-9-608(a)(3) and 6 I5(c). C. Surplus or deficiency - In a secured transaction that is a sale of accounts, chattel paper. payment intangibles. or promissory notes, unless otherwise agreed, the debtor is not entitled to a surplus nor liable for a deficiency. Rev. 9-608(b) and 615(e); Ark. Code Ann. 4-9-608(b) and 615(e). D. NonpcompUance - RA9 adopts what is known as the "rebuttable presumption" rule for commercial transactions where the secured parry fails to comply with the enforcement provisions of Article 9. In the event a secured parry forecloses improperly, and then brings an action for a deficiency against the debtor. RA9 presumes that the vaJue of the collateral equals the entire secured debt unless the secured parry can rebut this presumption. Rev. 9-626(a)(3); Ark. Code Ann. 4-9-626(a) (3). Revised Article 9 does not specify the process to be used in consumer transactions. E. Status of guarantors - RA9 requires that disposition notifications be given to guarantors and secondary obligors. Rev. 961 I(c)(2); Ark. Code Ann. 4-9-61 1(c)(2). This notification cannot be waived by the guarantor or secondary obligor until after default. Rev. 9-624(a); Ark. Code Ann. 49-624(a). If [he guaranror or secondary obligor is not known to the secured parry, the secured parry is nOt liable for Failure to notify. Rev. 9 628(a) and (b); Ark. Code Ann. 9-628(a) and (b). F. Insider dispositions - RA9 protects the debtor from situations where a secured parry. someone related to a secured parry, or a secondary obligor acquires collateraJ at a foreclosure sale which coUects proceeds that ace significantly lower than me proceeds that would have been realized through comparable sale to an unrelated purchaser. RA9 defines a person rdated to a secured party at 9- I02(a)(63). See Ark. Code Ann.

4-9 I02(a)(63). Ifsuch a sale takes place, the deficiency that remains must reAect a credit to the debtor for the higher amount of proceeds that would have been paid through a sale to the hypothetical unrelated purchaser. Rev. 9-615(f); Ark. Code Ann. 4 9-615(f). G. Consumer provisions - RA9 contains many proVIsions with special rules governlllg consumer transactions. A consumer transaction is defined as a transaction where an individual i.ncurs an obligation primarily for personal, family. or household purposes. a security interest secures the obligation. and any of the collateral is held primarily for personal, family, or household purposes. Rev. 9102(a)(26); Ark. Code Ann. 4-9102(a)(26). Consumers receive various special notices III connection with foreclosure. For example, the 10 days per se reasonable notice rule for notice of the secured parry's disposition of collateral does nor apply to consumer collateral. Rev. 9-6 I2(b); Ark. Code Ann. 4-9-612(b). A consumer debtor must be provided with an explanation of the calculation of any deficiency owed prior to the secured parry's demand for paymenr of such deficiency. Rev. 9-616; Ark. Code Ann. 4-9-616. A secured party cannot retain collateral in possession of a consumer debtor and cannot retain such collateral in partial satisfaction of a secured debt. Rev. 9620(a)(3) and (g); Ark. Code Ann. 9620(a)(3) and (g). A consumer debtor can never waive his right of redemption, even following default. Rev. 9-624(c); Ark. Code Ann. 9-624(c). Finally, the courts are free to adopt any rule (i.e., rebuttable presumption. offset, or absolute bar) when it comes to deficiencies in consumer transactions; the "rebuttable presumption" rule governing deficiencies in commercial transactions does nOt apply. Rev. 9-626(a); Ark. Code Ann. 4 9-626(a). H. Exclusions The enforcement provisions in Parr 6 of RA9 do not apply to true co-signors or buyers ofaccounts, chattel paper, payment intangibles, or promissory notes, except a buyer's obligation to use commercial reasonableness in collecting collateral when the buyer has a right of chargeback on uncollected collateral or full or limited credit recourse to the debtor. Rev. 9-601(g) and 607(c); Ark. Code Ann. 960 I(g) and 607(c).

I'll. 11,1'1. mall 210 I

T~! ArkllSll La~w

II

I. "Co11lnurcinl Reasonnbulli!ss" - Each aspect of the foreclosure sale must be

"commercially reasonable." Rev. 9-610(b); Ark. Code Ann. 9-610(b). A low price alone does not render a sale not "commercially reasonable," bur such a price suggests that a court should carefully scrutinize all pares of the disposition. Rev.

9-610; Ark. Code Ann. 9-610. j. "Good Fai,h" - The definition of "good faith" in RA9 is consistenc with the revisions to other UCC articles, and includes "honesty in faCt and the observance of reasonable commercial standards of fair

dealing." Rev. 9-102(a)(43). SUMMARY: (I) Revised Article 9 broadens irs scope as to what may be encumbered pursuant to it, and expands certain existing categories, notably "accounes."

III. Ilf III. III III III III III III III III. III III III III III III. III III. III.

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(2) It expands me definition of "proceeds."

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cover distributions on stock and licensing proceeds. with the same result. (3) It extends me Article 8 concept of "control" ro deposit accounts and letters of credit.

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(4) Ir expands the definition of "purchase

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money security interest" and clarifies priotities among competing PMSI lenders, although at the cost of less certainty in traditional crop production lending. (5) It makes perfection easier by permitting filing on instruments, by reducing the need for an inked debtor signature, by

simplifYing where

to

file. and clarifYing the

rules on collateral descriptions. (6) It eliminates local filing except for fixtures, timber and agricultural products, and standardizes forms and rules for central

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filings. (7) It encourages certainty and uniformity in foreclosure situations.

(8) It makes collateral more easily pledgable. including deposit accounes. (9) It provides for a manageable transition

period. Once fully implemented. Revised Article 9 will benefit lenders and borrowers alike (but generally nOt trustees in bankruptcy) .â&#x20AC;˘

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Inadvenent Disclosure of Privileged or Work Product Material I was attending a seminar last Spring, sitting in on the first segment of the afternoon. which was on wi mess preparation, when the speaker began to describe his law firm's personal experience with inadverrent disclosure. As best I can remember it went like this: A client was being prepared for deposition. The client suffered from a particular disease or condition that is known ro be caused by prolonged exposure to a particular produce. This client was one of many clients that this law firm was representing in regard to this particular product. Because of the number of clients

contained advice on how the client could and should answer certain questions regarding the client's injuries. The advice was very explicit. For instance. the c1jent was advised that if asked a certain question, the dient should respond that she did indeed have a fear of developing certain complications later in life that could prove fatal. The advice contained suggestions on how to respond to questions with instructions that me client should "be sure" to state such and such if asked a certain question. Well, the day came for the client's deposition and an associate in the firm

and the number of depositions, paralegals

defended the deposition since lead counsel

were being utilized extensively in witness preparation. As we know, there are many ways in which witnesses can be prepared for deposition or trial. There are companies which produce video tapes on deposition preparation. Many law firms use testimony memorandums. "Wood shedding" can also include mock examination sessions utilizing twO lawyers to play the appropriate role of opposing counsel. In this particular case. the law firm had

was otherwise obliged. Defendant's counsel asked the client for her tax returns and as she shoved them across the table, somewhere near the bottom of the pile went her testimony memorandum. You can imagine

hired a bright new paralegal who had taken

plaintiff's attorney. being quite caught by surprise, had to appear at a hearing within a maner of days before an obviously concerned judge. He requested time to research the issue as he had JUSt found out

it upon herself to create a testimony memorandum for all of the firm's clients. This particular testimony memorandum

David Williams has a law practice in

Lirde Rock.

He

received his law degree from the LeAar Law Center, University of Arkansas at

Fayetteville. Arkansas

He is a member of the

Bar Association

Editorial

Advisory Board.

n

T~e Arkum LI~W

what happened. To make a long srory shorr, defense counsel kept the testimony memorandum, mailed and published it over the internet to other defense counsel across the counrry, and filed a motion to sanction plaintiff's counsel for an ethics viola lion and to disqualify him from representing any

fiHmer clients againsr me defendant. The

whar had happened and had no law on the top of his head that he could immediarely recite. The judge granted his requesr and this lawyer began a fervent search for some law. As It rums out, the law regarding inadvertent disclosure of privileged or confidemial material that one's adversary did not intend for one to have states mat me recipient (1) must not look at it, (2) must notify the lawyer from whom you obtained the privileged or confidential document,

and (3) must thereafter follow thar lawyer's w~lI'.ark~ml.

instructions.

Let's examine the applicable

e<hical rules before gerting back ro this lawyer's predicament. The preamble to the American Bar Associa,tion Model Rules of Professional Conduct described the general responsibilities lawyers owe fO their clients. The Preamble states that a competent lawyer "provides a c1iem with an informed

undemanding of the cliem's legal rights and obligations and explains their practical implications" and "zealously asserts the client's position under the rules of the adversary system." The comment to Rule 1.1 explains that "adequate competence includes preparanon." Witness preparation is recognized as an indispensable dement of pretrial

preparation. In Hamdi and Ibrahim Mango Co. o. Fir< AJs'n of Philadelphia, 20 ER.D. 181, 182 (S.D. .Y. 1957), the Courr held that "it is usual and legitimate practice for ethical and diligent counsel to confer with the witness whom he is about to call prior to giving his testimony." The duty of zealous representation therefore obliges the attorney to "maximize the value of witnesses and their testimony.

J.

Piorkowski, Proftssional Conduct in the Preparation of Witness" for Triac Defining the Acceptable Limits of "Coaching," I.

GEORGETOWN J. LEGAL ETHICS 389, 389 (1987). The key erhical obligation that limits witness preparation is very simple: the lawyers should not create or encourage false This ethical obligation is testimony.

reglected in Model Rule 3.3 Ca lawyer shall not knowingly offer evidence that the lawyer

knows ro be false"). Model Rule 3.4 ("a lawyer shall nor falsify evidence, counselor assist a witness

to

testify falsdy").

The U.S. Supreme Courr has observed that an attorney "must respeer the important ethical distinction between discussing testimony and seeking

improperly to inAuence It." Ceders v. Un;ud SlaW, 425 U.S. 80, 90 n.3 (1976). Section 176 of the most ream draft of the Restatemem of the Law Governing Lawyers reaffirms thar a lawyer "may imerview a witness for the purpose of preparing rhe witness ro tcuify." The commentS to section 176 explain thar a lawyer preparing a witness may "invite the witness to provide truthful restimony favorable to the lawyer's diem" and list several ways thac a lawyer may prepare a witness to testify truthfully and effectively. These methods include: 1. Discussing the witnesses recollection and probably restimony. 2. Revealing ro the witness other evidence that will be presented and asking the witness to reconsider the witnesses testimony in mat lighr. 3. Discussing the applicability of law to rhe evems and issue. 4. Reviewing the faCtual context imo which the witness's observations or opinions will fir. 5. Reviewing documents or other physical evidence that may be introduced. 6. Discussing probable lines of hostile crossexamination. 7. Rehearsal of restimony. 8. Suggesting the choice of words to make the witness's meaning dear. Some of these methods raise particular ethical quesrions that deserve more detailed discussion, but which space constraints limit here. Needless to say there is a big difference between refreshing a witness's recollection and putting words in his mouth or ideas in his mind, when not supported by the evidence. As che District of Columbia Bar summed up "what does matter is that whatever the mode of witness preparation chosen, the lawyer does not engage in suppressing, distorting. or falsifying the testimony that the witness will give." (Legal Ethics Committee Opinion No. 79, December 18, 1979). Back to rhe story. Ar rhe hearing on defense counsel's morion for sanctions and to disqualify, plaimiff's counsel presented the legal argumentS ser out above. He argued that not only was there nothing improper in what his para.legal had done via the preparation of the testimony memorandum and the rehearsal with the client, but that the law firm had an ethical obligation to the client to so prepare her for

her deposition. And, that the disclosure was inadvertem; that defense counsel should have immediately returned the documem; that by publishing it over the internet and to orher defense counsel he had breached rhe applicable erhical rules, and rhar he and his law firm should be disqualified from represeming the defendant in future litigation, not the other way around. The judge agreed and granted rhe counter motion of the plaincifT seeking just rhar relief. So, rhings ended happily ever after for this lawyer and his inadvertent disclosure problem. There are some wrinkles regarding this issue, however. Some states have been slow to embrace the conclusions reAected in the ABA opinion. For example, in a 1993 opinion, the California Court of Appeals reversed a trial court decision imposing monetary sanctions on the law firm of a lawyer who had innocently received - and then reviewed and used - documents that his opponent did not intend to disclose co him. The Court found that at least on the factS before ir, the lawyer did nothing improper in reviewing the documem he received. Ethics committees in Ohio and Maine have reached similar results, a1rhough borh explicitly impose a duty on the lawyer CO inform opposing counsel of the inadvertent

production. In a May 1995 OptnlOn, the D.C. Committee on Legal Ethics stared that it is permissible for a receiving lawyer to review. retain and use inadvertently produced documents if he receives them in good faith without knowledge of the inadvertence. On the other hand, when the receiving lawyer learns of the inadvertent production bifor~ he examines the materials. D.C. requires the lawyer to notify opposing counsel and, if requested, return the material unread. Failure to do so would be a dishonest act in violation of Rule 8.4(c). These decisions reflect competing views of a lawyer's erhical dury. Ir has been suggested that not all duties are defined by a narrow legalistic reading of the black lener of rhe model rules. The besr advice is simply to follow rhe old Lou Hohz "do right' rule and treat other lawyers, and their confidentiaJ and privileged materials the same way that you would want to be treated. To be safe, and hopefully nor have co worry about having the same thing turned around against you, when you receive inadvenenr disclosures. do what good lawyers do: put it in an envelope immediately without reading it, and send it back; and call your opposing counsel and let him know. He'll appreciate ir. I know I did! •

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In re: TECHNOLOGY Digital Discovery Grab Bag bY late MarQuess

W"db exPanding federal mles, lawvers have to get ahandle on e-nles Reprinted by permission of the ABA JournAl Call it the smoking gun e-mail: a sput-ofthe~moment scrap of communication sent through cyberspace with little thought of the consequences. Until, that is, it ends up in opposing counsel's discovery satchel. "There are times when we turn ro each othet and say, "Oh, my God, I can"t believe I JUSt wrote that," " says Virginia Llewellyn, counsel at Bellevue, Wash.-based Applied Discovery, a company that helps lawyers gather electronic discovery materials. "It's such an instam form of communication that you don't think about it," Monica Lewinsky probably gave linle thought ro the e-mail she scm ro Linda Ttipp:" ice that the Big Cteep didn't even try ro call me on V-day." It wound up in Kenneth Starr's Independent Counsel Repon in 1998. And there was the infamous e-mail Bill Gates sent to Microsoft executives in 1997: "Do we have a dear plan on what we want Apple to do to undermine Sun?" That one was admitted as evidence In the government's antitrust SUI[ against Microsoft. What may be surprising, however, is that even the most egregiow episodes don't seem ro be setting an example for e~mai1ers. That can be a nightmare for litigators. II III? II......... Lawyers are facing an expansion of fedetal discovety rules. As of Dec. I, all federal district courts mwt comply with the 1993 amendment to Federal Rule of Civil Procedute 26(a)( I), requiring litigants to rurn over all materials relevam to a dispute including e-mail and ocher elecuonic documents regardless of whether the other side has made a discovery request. Although the new rules mandate

discovery, they nevertheless narrow the breadth of what needs to be ptoduced to claims and defenses, says Portland, Ore., litigaror Dennis Rawlinson. "Production of electronic documentation scares us becawe of the large number of documents," says Rawlinson, co-chair of the Commercial and Business Litigation Committee of the ABA Section of. Litigation. "If anything, ie's good news that at least the breadth of discovery has been narrowed with the new rules." Still, he adds, there likely will be battles between opposing counsel over which electronic documems are covered. For litigators, that means instructing clients not only about e-mails but all electronically stored data that could end up in discovery, such as case management files, billing records and calendars. Electronic discovery poses anorher problem, especially in cases involving technology businesses. Trade secrets and other privileged dara often reside on the same hard drives and computer disks as a company's discoverable information. "Thar's a real problem, especially when you're dealing with cases rhat involve competitors suing [each other]," says U.S. District Judge Barbara Rothstein, who sits in the Western District of Washington. "The last thing you want is your competitors getting into that. "Discovery is the most painful patr" of a high-rech case, says Rothstein. "I often heat that the goal of a suit was to get at the other side's trade secrets. " Jon Sobel, associate general counsel ar Yahoo, recommends asking for protective orders early and taking a proactive role in managing discovery. "Don't let discovery by che other parry get our of control," he says. Ask the judge for case management orders, Sobel says, to limit the scope.

Rothstein recommends having a neutral third parry analyze electronic files involved in a case. "How you set up protective orders is very important, determining who looks at what. It can become very hairy."

Til 2' ... I TrII Possibly of greatest concern among discoverable e1ecuonic documents are email messages, which are also the most worrisome and often the most incriminating. Applied Discovery's Llewellyn says she often finds cases where e~mails were che "gotcha." In such cases, e-mail senders may be trying to cover their tracks with a casual, rransiem message, when in fact they're creating an electronic paper trail. "We find lots of [e-mails]saying...Oh.by the way, there's litigation on [the e-mail subject], so be sure to destroy that memo." Overwhelmed by torrents of electronic data, some lawyers agree with their opponents not to ask for each other's e-mail archives during discovery, Llewellyn says. "Attorneys have acruaUy been negotiating e-mail off the table," she says. Looking the other way is easier than poring through what may amount to millions of documents. "l've had people say, "We have not found a way to deal with this. It would take years and hundteds of thousands of dolJatS." In many jurisdictions where the mandatory disclosure rule has not been in effecc, some lawyers may enter into stipulations, says Rawlinson. He speculated that his own state of Oregon, which did not comply with the rule prior to Dec. I, would allow opposing attorneys to stipulate what would be produced. TlCI lillY

Continued on page 39

Llewellyn doesn't recommend mat tactic. "The realiry ... is mat they're JUSt not

IOlerating "hide the ball." It's really a wiset move to educate clients upfront, make them smarter about how they do business right now." Mandatory disclosure rules allow for "brutal" discovery sanctions, Llewellyn warns. And courts don't need bad faith to issue them. For example, in Procter & Gamble Co. v. Haugen, 179 ER.D. 622 (D.

Utah 1998), Procter & Gamble admitted

10

discarding e-mail messages of employees identified during discovery who possessed knowledge relevant to me litigation. The court did nOt issue a bad-faith instruction

but did issue discovery sanctions of $1 0,000 against the company. The court dealt a more crushing blow in

In re Prudential Insutance Co. Sales Practices Litigation, 169 ER.D. 598 (D.N.). 1997). In that case, the judge issued a $1 million sanction against Prudential for improperly destroying electronic dara that harmed a plaintiff's ability to establish claims.

erase backup rapes every 48 hours.禄

them, coding them into a darnbase and then

document was created, who created it and who received it. Ontrack Data International, an Eden Prairie, Minn.-based company, provides a simiJar service and also handles "computer forensiC5" in cases where information has been deleted and an expen is needed to get it back. Seanle-based Electronic Evidence Discovery Inc. recendy launched DiscoveryPartnerOnline.com, a Web site that offers the same kind of services. ""If I was litigating a case, I guarantee yOll my first [requestl would be: List every email account you've had in the last five years," Llewellyn says. ""You'd be in serious trouble if you didn't turn that over." _

searching them for [he relevant informacion. Several companies offer electronic discovery services that manage such

Kate Marquess is II tecbnology writer and lntertlet editor for tbe ABA jou"",L

Pay attention [0 how the courts in your jurisdiction are handling electronic discovery. Deal with litigation immediately. Preventive mainrenance is important in dealing with clients, so talk to them before ie's tOO late.

. . . . . 1IIlJ Gathering the dectronic information is the first step. Many firms, faced with a pile of CDs, computer disks and hard drives, instruct [heir paralegals (Q spend the months it takes printing out documents, rescanning

informarion. Llewellyn's Applied Discovery compiles electronic discovery documents in a searchable database so litigators don't have to prim our files and read each one individually. E-mails remain linked to acrachmenrs, and [hey also maintain their meta-data, information such as the date a

Llewellyn offers other tips for lawyers trying to get their arms around all me bits

and bytes. Know what your client has so you can go and get all of it. Most companies use a variery of software programs for communications. Look for programs that handle word processing, e-mail and calendaring, spreadsheets and databases. Ask about the c1iem's record retemion

policy. Companies may begin regularly discarding old back- up tapes to circumvent

discovery requests, but Llewellyn doesn't recommend it. "Once you're pur on notice) it's not going to be good enough to say, ""We

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drowning in debt to earning a year, praclically overnight," he says. Most lawyers depend on referrals, he nOles, but nOI one in 100 uses a referral syslem. "Wilhout a system, referrals are unpredictable, and so is your income,"1le says. Ward has taughl his referral syslem to more than 2,500 lawyers worldwide, and has wrinen a new report, "lIow 10 SJOO,OOO

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II

JUDGE JOHN McCLURE, L"'lo Rock

SIGNIFICANT DECISIONS OF THE SUPREME COURT OF ARKANSAS SpollSored by The Arkansas Supreme Court Historical Society, illc. Brook, v. Page (May 7,1874)

By L.

SCOTI STAFFORD

During its 160-year hiscory me Supreme Court of Arkansas has issued a number of controversial decisions. One such decision-Brooks v. Page--proved so unpopular that it led within weeks co the removal from the bench of every justice who had joined in the 0pullon. The decision grew out of the gubernacorial election of 1872. The Republican Parry had gained control of Arkansas state government in 1868 in me wake of the congressional Reconstruction Acts, but after four years in power the Republicans had split into (\vo factions. The regular wing of me parry nominated Circuit Judge Elisha Baxter for governor. A group of Reform Republicans named a ticket headed by Joseph Brooks. Rather than nominate a candidare, the Democratic state committee endorsed Brooks, and most Democrats who were eligible to vote probably supported Brooks. Baxter was declared the winner and sworn into office in January of 1873, but Brooks contested the election in several forums including me federal courtS, the General Assembly, and the state couns. The matter seemed settled

40

Tir, ,Irkmas La~Ter

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in June of 1873 when the Arkansas Supreme May 4, 1874. Justices John Bennett, Court refused to issue a writ of quo Elhanan Searle, and Marshall Stephenson warranto that would have forced Baxter to immediately set out for [he capital, but when their train arrived at Argenta Station prove his right to the governor's office. By rhe spring of 1874, however, many on me north side of the Arkansas River, an regular Republicans had become armed detachment of Baxter mi.litia disenchanred with Baxter after the governor kidnapped Bennett and Searle. The Baxter appointed a number of Democrats to public forces did not recognize Stephenson who office and refused to back legislation for the escaped to Little Rock, bringing news of the relief of me railroads. Following his defeat abduction of Bennett and Searle. The twO in the quo warranto action, Brooks had filed kidnapped justices were taken to Benton an election contest in PuJaski Circuit Court, and held prisoner until May 5, 1874, when but no action had been taken in the case they managed to escape. On May 7, 1874, after Baxter had filed a demurrer. On April four of the five members of the court issued 14, 1874, Circuit Judge John Whytock, a an opinion holding that Whyrock's decision regular Republican, set a hearing on Baxter's made Brooks the governor. The opinion demurrer without advising Baxter's was immediately forwarded to Washington, anorneys. The following day Whytock but in the meantime Baxter had managed to overruled the demurrer and issued a assemble a quorum of the General judgment declaring that Brooks was the Assembly, which endotsed him as governor. On May IS, 1874, President Gram governor of Arkansas. Brooks, accompanied by armed men, proceeded to the state settled the contest in Baxter's favor after the capitol and ejected Baxter from the United States Attorney General issued an governor's office. Over the next few weeks opinion concluding that the Arkansas armed supporters of both candidates poured constitution vested the legislature with the exclusive power to determine an election inro Little Rock. Both sides appealed to Presidem Ulysses contest for governor. The attorney general's S. Grant for support, but the president opinion curtly dismissed the Arkansas announced that the matter should be setrled Supreme Court's "made up" decision in by either the Arkansas legislature or the Brooks v. Page, which, according to the Arkansas couns. The General Assembly was atrorney general, "was submitted to judges known to favor Baxter, but four of the five virtually pledged to give the decision members of the supreme court were from wanted.... " On the same day that news of the the regular Republican wing that now supported Brooks. Baxter issued a caU for a president's decision reached Little Rock, speciaJ session of the legislature, while three of the supreme court justices-Brooks searched for a way to secure a McClure, Bennett, and Searle--Ieft town. supreme court's ruling that he was the legal Four days later Stephenson resigned and also After declaring Baxter the governor. Affirming Whytock's judgment left town. would have taken roo long, so Brooks governor, the General Assembly remained in created a case or controversy for direct session long enough to impeach McClure, submission to the high court. Both the state Bennett, and Searle, and enact legislation auditor, Stephen Wheeler, and the state suspending all three from office. The treasurer, Henry Page, were in Brooks' camp adoption of a new constitution in October and willing to cooperate in creating a of 1874 ended the terms of the three controversy. Brooks requisitioned $1,000 to impeached justices before they could be pay the COSt of his milida. Wheeler issued a . brought ro trial in the senate. In November state warrant for that amount, which Page 1874, a new supreme court formed under obligingly refused to pay, citing uncenainry the Constitution of 1874 unanimously as to who was governor. Brooks then filed repudiated Brooks v. Page, and the opinion an originaJ action in the supreme coun was omitted from the official Arkansas asking the court for a writ of mandamus Reports. For a more detailed description of the ordering Page to pay the warrant. Since the Court had recessed in February role of the Arkansas Supreme Court in the and was not scheduled to begin its next term Brooks-Baxter War, see Scot( Srafford, until June, all members except Chief Justice Judicial COllp D'Etat: Mandamus, Quo John McClure, a longtime nemesis of 11. . . . . IIIcIIIl â&#x20AC;˘â&#x20AC;˘ Baxter, were out of the city. McClure Continued on page 53 summoned the other justices to convene on

·llIdil'iill \lh isol'~ Opiniolls The Judicial Advisory Opinions are wrillell and provided by the Judicial Discipline and Disability Commission. Philip A. Bagby, Attorney at Law Bagby Law Firm RE: Advisory Opinion # 2001-05 Dear Anomey Bagby: You have indicated to this com mince that you intend to run for Circuit Judge in the general election of May 2002. You ask about the applicability of Canon 5C(2) of the Arkansas Code of judicial Conduct in lighr of the adoption of Amendment 80 to the Arkansas Consricution. Canon 5C(2) prohibits fundraising by the commictce of a candidate prior to 180 days before a primary election. With rhe new amendmem and implementing sracures, general elections for judges have been moved from ovember [0 May. However. the Arkansas Supreme Court has not changed the language of the Code. The intent of the Code provision was [0 place limits on the length of judicial campaigns. That intent applies also to nonpartisan elections. We have no authority ro rewrite the Code or ro temporarily suspend irs operation. We note that the Courr has in the past made quick changes in the Code, see for example, the Per Curiam of ovember 19. 1990.303 Ark. 755 (neporism), and the Per Curiam of May 30. 1995. 320 Ark. 715 (judicial stationery) and can certainly do so in this instance if it wishes. It is our opinion that Canon 5C(2) is applicable and, therefore, fund raising may nO[ begin unril 180 days prior to the May 2002 election. The Arkansas judicial Ethics Advisory Commiuee issued an advisory opinion ro Anomey Philip A. Bagby of Van Buren, Arkansas. He requested an opinion as ro whether, in light of the constitutional changes to Arkansas judicial elections, there should be a temporary suspension of the enforcemenr of the lBO-day fundraising limit in Canon 5C(2) of the Code ofjudicial Conduct until the Supreme Court has the opportunity to consider appropriate revisions ro that Canon. The opinion srares thar Canon 5C(2) prohibits fundraising by the commirree of a

me

candidate prior to 180 days before a primary election. With the new amendment and implementing statutes, the general elections for judges have been moved from November ro May. However, the Arkansas Supreme Court has not changed the language of the Code of judicial Conduct. The opinion further stated that the inrenr of the Code provision was to place limirs on the length of judicial campaigns, and that intent applies also to non-partisan elections. The Committee stated that they have no authority to rewrite the Code or to temporarily suspend its-operation, however, they nored thar rhe Coun has in the past made quick changes in the Code, and can certainly do so in this instance if it wishes. Examples given were the Per Curiam of November 19. 1990, 303 Ark. 755 (nepotism), and the Pet Curiam of May 30. 1995.320 Ark. 715 (judicial starionery). It was the opinion of the Committee that Canon 5C(2) is applicable and. therefore. fund raising may nor begin uncil 180 days prior ro the May 2002 election.

The Honorable Peter DeStefano Municipal Judge Re: Advisory Opinion # 2001-04 Dear Judge DeSlefano: In your request for an opinion dated July 30. 2001 you asked: "After a judge has conducted a trial and convicted a Defendant of cerrain charges, can the Judge then testify against the same Defendalll in a subsequent perjury trial concerning the Defendalll's testimony in the first trial?" In responding we have made the obvious assumption that the perjury trial is nOt in your court. The only provision in the Arkansas Code of Judicial ConduCl thal deals directly with a judge lestifying in coun is Canon 2 B which states in parr that "A judge shall nor testify voluntarily as a character wimess." Canon 2 A provides that "A judge shall respect and comply with the law and shall act at all times in a manner that promotes public confidence in the integrity and impartiality of the judiciary." If subpoenaed to testify before another coun you should simply abide by the law and by the Arkansas ode of Judicial Conduct.

(Psst...) • • •

The Arkansas Bar Association wants you to know we're just a click away.

www.arkbar.com Legal Info Links • Arkansas Veterans Handbook • Disaster Legal Assistance • High School Mock Trial Program • Senior Citizens Handbook/CareGivers Guide THE ARKANSAS

BAR AsSOCIATION

A TRADITION OF PROFESSIONALISM AND PUBLIC SERVlCE (501) 375-4606 • (800) 609-5668

Lawyer Disciplinal'y Actions The Lawyer Disciplinary ACliolls are ",rillen mid provided by 'he Supreme COlin ofArkansas' Commillee Oft Professional emldllel. ORDER OF DISBARMENT GEORGE R. WADLEY Jonesboro

May 29.2001 Now on this 29th day of May, 2001, the date scheduled for the sanctions hearing, the plaintiff, Stark Ligon, in his capacity as the Director of the Supreme Coun Commincc: on Professional Conduce appears through his scaff counst:1, Lynn Williams. The defendant. Grorge R. Wadley. does not appear. After consideration of the pleadings, me evidence: offered, statements of counsd and orner manc:rs before: the Coun, the: Coun doth find that: I. By order of this Coun filed on May 2. 200 1. this Coun found defc:ndam in defauh for failing to respond to the Executive: Director's Complaint. The dury of this Coun is to decide: the: appropriate sanction for the violations SCI out in the Executive Direct,or's Complaint by using the guidelines as set out by the decisions of the Arkansas Supreme Court, particularly, Neal v. Hollingsworth, 338 Ark.

me:

251.992 S.W. 2d 771. A. Mr. Wadley has had four previous public sanctions by the Supreme Court Committee on Professional Conducl. In order of the filing date with the Arkansas Supreme Court Clerk, they are: a.) July 15, 1997. a ~primand for biling to serve opposing parry with a petition and notice and then ming a verified petition with the Court that he had served the opposing parry with the petition and notice. b.) February 22. 200 I, a one year suspension for failing to perform any work in ~half of hjs client. Donald Bar~r after being retained for $1.500.00. Mr. Wadley also refused to refund any of the unearned retainer to Mr. Barber. c.) February 22. 200 I. a one year suspension for his failure ro respond t'O a contempt citation filed against his client Donnie Ault after being ~tained by Mr. Ault to ~present him in a child visitation maner. Additionally, Mr. Wadley falsdy stated to his client that he had scheduled hearings in the ClSI= when it actuality he had nO[ Clusing unnecessary delay in Mr. Auh's case; d). February 22, 200 1. a one year suspension for F.dsely ~presenting to a parole hearing judge that his law license was in good standing. when in fact. his license was suspended due to Mr. Wadley's fajlu~ to complete his CLE requirements. B. The defendant's misconduct resulted in a loss and damage to his client. Ms. Coleman. The misconduct involved his failure to represent his client, Ms. Coleman. The misconduct is a pan of a pattern of similar misconduct. The lawyer's prior record of public sanctions demonstrates a substanrial disregard of the lawyer's professional duties and responsibilities. The misconduct was serious and has damaged the legal profession. 4. The appropriate sanction for the misconduct should be the disbarment George R.

l2

The Arkansas I,awler

www.arkhar.rom

Wadley with his mtme ~ing removed from the registry of licensed anornc:ys mainrained by the Clerk of thc Arkansas Supreme Coun Clerk. 5. The authority to grant and revoke the pnvilege to pr.tctice law lies exclusivdy within the jurisdiction and authority of the Arkansas Supreme Coun. This Coun finds that it cannot revoke the law license of George R. Wadley, but the Court affirmatively finds that disbarment is the appropriatt: sanction. 7. George R. Wadley. should ~ and he~by is, prohibited and barred from engaging in me pr.tcticc: of law within the jurisdiction of the State of Arbnsas pending an appropriate petition to the Supreme Court for the disbarment of the defendant by the Supreme Coun.

IT IS THEREFORE CO SIDERED. ORDERED. ADJUDGED AND DECREED ,hal the defendant's misconduct alleged in the Complaint is found to Ix in violation of Rules 1.1. 1.3. 1.4(a). I. I6(d). 8.4(c) and 8.4(d) of ,he Arkansas Model Rules of Professional Conduct; that the appropriate sanction for such violation is the disbarment of George R. Wadley; and that, pending :1 petition to the Arkansas Supreme Coun seeking such disbarment. George R. Wadley should be, and hereby is, prohibited and barred from engaging in the practice of law within the jurisdiction of the Stale of Arkansas. (Petition to disbar grantcd on June 21, 2001.)

NOTICE OF SURRENDER OF AlTORNEY'S PRIVILEGE TO PRACnCE LAW JAMES ODELl CLAWSON. JR . uule Rock. AR June 7. 2001 James Odell Clawson, Jr., an attorney formerly residing in Little Rock, and formerly pr.teticing law in Linle Rock. Pulaski County. Arkansas. wim Arkansas Bar 10 #90219 has been barred from engaging in the pr.tctice of law in this State for viol:uion of the Arkansas Mood Rules of Ptofessional Conduct. On the recommendation of the Arkansas Supreme Coun Committee on Professional Conduct, the Arkansas Supreme Court accepted the surrender of me law license of Jama Oddl Clawson, Jr. on June 7. 2001. Anomey Clawson's Petition to Surrender was based upon violation of Model Rult: 8A(b)of the Arkansas Model Rules of Professional Conduct. The Petition and anached exhibits on file with the Clerk of the Arkansas Supreme Coun demonstrate thaI Mr. Clawson was convicted in the State of Oklahoma of twO (2) felony counts of Uttering a Forged Insrrument, in violation of 21 0.5. 1592 and that, on April 9. 200 I, a jury convicted Mr. Clawson of six (6) COUntS of bankruptcy fraud in violation of 18 U.S.c. Section

152, in the United States District Coun for the Eastern District of Arkansas. Case No. 4:00cRI89. If you have any questions in this regard or, you have information evincing the attorney's continued practice COntr.try to the StatUS of his license. please contact this office.

KENNETH GERALD BRECKENRIDGE Hot Springs. AR On recommendation of the Sup~me Coun Comminee: on Professional Conduct. wc hereby accept the sur~nder of tht: licen~ of Kenneth Gen.ld Breckenridge. of Hot Springs. Garland Counry, Arkansas. to practice law in the State of Arkansas. Mr. Breckenridge's name shall be removed from the registry of licensed anorneys and he is barred from engaging in the practice of law in this State.

KENNETH GERALD BRECKENRIDGE Hot Springs, All. June 7. 2001 Kenneth Gerald Breckenridge, an attorney residing in Hot Springs, formerly practicing law in Garland and Montgomery Counties, Arkansas. with Arkansas Bar 10 #84015 has been barred from engaging in the practice of law in this Stare for Arkansas Model Rules of violation of the Professional Conduct. On the recommendation of the Arkansas Supreme Coun Committee on Professional Conduct. the Arkansas Supreme Coun accepted the surrender of the law license of Kenneth Ger.tld Breckenridge. on June 7, 200 I . Anomey Breckenridge's Petition to Sur~nder was b~ upon violation of Model Rules 1.3 and 3.4 (e) of the Arkansas Model Rules of Professional Conduct. The Petit'ion and attached. Exhibits on file with the Clerk of the Arkansas Suprt:me Court demonstr.tte that the Honor.tble F. Fussell. United Snnes Bankruptcy Robert Judge made a judicial referral to the Comminee: on Professional Conduct which resulted in a formal disciplinary complaint against Mr. Breckenridge based upon his condua in thltt bankruplCY matters pending befo~ Judge Fussell. Mr. Breckenridge admitted SpecifiCllly. th;1( he fajled to respond in a timely maner to various Motions and Coun Orders; fajJed to comply with a P~-Trial Order of the Court; failed to follow the directive ofJudge Fussell following various Show Cause Orders; failed to surrt:nder papers to a former client; failed to take action to protect the monies of rhe debtor's estate as directed; and fajled to follow specific directives of Judge Fussell in each bankruptcy maner. If you have: any question in this regard or you have information evincing the anorney's continued practice contrary to the status of his license. please contact lhis office.

Lawyer Disciplinary Actions EDWARD WRIGHT, Jil

ORDER OF SUSPENSION

Pulaski Couney June 7,2001

JOANN C. QUIRK

On recommendation of the Supreme Court Committee on Professional Conduct, we hereby accepr the surrender of the license of Edward L. Wright, J. of Little Rock, Pulaski Counry, Arkansas, 10 prncticc law in the Sr3l'C of Arkansas. Mr. Wright's name shall ~ removed from registry of licensed attorneys and he is barred from engaging in the practice of law in this state. It is so ordered.

me

EDWARD L. WRIGHT, Jil Pulaski Counry, AR June 7,2001

Edward L. Wright, Jr., 3n attorney residing in Little Rock, formerly practicing law in Pulaski County, Arkansas, with Arkansas Bar 10 #59022 has been barred from engaging in the pract'ice of law in this State for violation of the Arkansas Model Rules of Professional Conduce. On the recommendation of the Arkansas Supreme Court Committee on professional Conduct, the Arkansas Supreme Court accepted the surrender of the law license of Edward L. Wright, Jr., on June 7,2001. Anorney Wright's Petition to Surrender was based upon violac-ion of Model Rules 1.7(b), 1.15(,),3.4ÂŤ), 8.4(C) 'nd 8.4(d) of rhe Arkansas Model Rules of Professional Condua. The Petition and altached exhibits on file with the Clerk of the Arkansas Supreme Coun demonstrate that William Burke Brady and Connie Brady filed a formal complaint against Mr. Wrighl as a result of his conduct in the probale of their deceased father's estate. Specifically, Mr. Wright continued to represent the Estate and all four heirs after developing a conflici of interest by becoming personally involved with one of the heirs; failed ro maintain the Estate funds scparue from his own by making unauthorized wilhdrawals; failed to obtain Orders from the Probare Judge prior to making distributions and paying himself fees; made several thousand dollars of unauthorized withdrawals; prepared a false ledger in an attempt to hide the unauthorized withdrawals; falsely advised one of the heirs that a Global Settlement Agreement was prepared [0 provide additional fees rather than advising thai the purpose was (Q recover amounts owed to the Estate; and, engaged in self-dealing which caused a delay in the completion of the probate process. If you have any quest'ion in this regard or you have information evincing the attorney's continued practice comrary (0 the statUS of his license, please contact this office.

Linle Rock, AR June 29, 2001 The formal charges of misconduct upon which this Order is based came 1'0 the anemion of the Comminee due to testimony given in U.S. v. George Nicholas "Nick"Wilson, et aI, Case No. LR~CR-99-61. JoAnn C. Quirk is an anorney practicing in Little Rock, Pulaski County, Arkansas. On March 20, 200 I, Ms. Quirk testified in Federal CoUrt in the above sryled case. She testified pursuant to a cooperating agreement with the United States Anorney that she be placed on pretrial diversion. She testified that in the Spring of 1997, she was the Director of the Arkansas Board of Collection Agencies. She also was engaged in the practice of law with a significant portion of her practice involving representing children, especially as an anorney ad litem. Ms. Quirk learned from Senators Nick Wilson and Michael Todd, along with Mona Mizell, (all three Arkansas lawyers at the time) of a new program to fund anorney ad litem programs. Ms. Quirk assisted Mona Mizell in the writing of a gram request thai led to Ms. Mizell receiving funding from the Administr.ttive Office of the Couns for her program for the Sixth Judicial District (Pulaski and Perry Counties). The gram request was submitred June II, 1997, and was funded on July 23, 1997. On August 25, 1997, Ms. Quirk submirred a statement for her services under the grant. The statement included work she performed prior to the implementation of the program. It also included expenses for a trip to San Francisco, California, in which she anended a conference on anorney ad litem issues. The conference was June t, 1997, and the expenses were incurred prior to the implememation of the anomey ad litem program. On August 25, 1997. Ms. Quirk received payment ($14,477.14) for those expenses and services from Celllral Arkansas Child Advocacy Services, Inc., which had received its funding from the attorney ad litem program. In September 1997, Mona Mizell and Senator Wilson decided to end their participation of the anorney ad litem program and refund all the money received. This action was precipitated by a requested audit of the program by the Administrative Office of the Courts. Ms. Quirk returned $30,000.00, representing the unearned portion of the retainer she received from Central Arkansas Child Advocacy Services. Additionally, Ms. Quirk learned at that time that Senator Wilson was receiving funds from the program when he was doing no work. Senator Wilson instructed Ms. Quirk to destroy her notes and calenders generated from her participation in [he anorney ad litem program. Ms. Quirk destroyed some, but not all of her notes and none of her calendars. Ultimately, Senator Wilson and Ms. Mizell plead

guilty to federal felonies due 1'0 their participation in the program. Ms. Quirk entered imo a cooperating agreement with the United States Anomey's Office. Ms. Quirk submitted herself to a federal pre-trial diversion program that required her to be supervised by the United States Probation Office. Ms. Quirk admined in her testimony at trial that she had accepred responsibility to the federal crime of Misprison of a Felony. Ms. Quirk affirmatively stated in her response that she admits to using poor judgement and making bad decisions that not only hun herself, but also harmed the legal profession. She stated that she failed to report to the appropriate authorities that Nick Wilson was receiving rent paymenrs from Mona Mizell in excess of what the space demanded. Ms. Quirk stated that she will complete her pretrial diversion program on August 30,2001. Ms. Quirk stated that she completed the cases assigned to her under the ad litem program on a pro bono basis to insure that the children participanrs where not affected. Following Ms. Quirk's receipt of the formal complaint, the respondent anorney offered to enter into a discipline by consent pursuant to $eetion 8C of the Procedures of the Arkansas Supreme Court Regulating Professional Conduct of Artorneys (Procedures). The Acting United States Anorney for the Eastern District of Arkansas, who personally tried the "Nick Wilson" cases, has concurred in Upon writing to the discipline by consent. consideration of the formal complaint, the respondent anorney's response, the terms of the proposed consent to discipline hereinafter stated, the Alternate Comminee on Professional Conduct approval thereof, and the Arkansas Model Rules of Professional Conduct, the Committee on Professional Conduct finds: 1. That Ms. Quirk's conduct violated Model Rule 8.3(a) when she failed to reporr to the appropriate authorities that George "Nick" Wilson. a lawyer, was receiving illegal rem paymenrs from Mona Mizell in excess ofwhat the space demanded. Model Rule 8.3(a) requires that a lawyer having knowledge that another lawyer has committed a violarion of the Rules of Professional Conduct that raises a substantial question as to that lawyer's honesty, lrustworthiness or fitness as a lawyer in other respects, shall inform the appropriate professional authoriry. 2. That Ms. Quirk's conduct violated Model Rule 8.4(c) when she submitted billable hours incurred from May, 1997 and June, 1997 to the Central Arkansas Child Advocacy Services, Inc. funded by the Administrative Office of the Courts when the program was not implemented and funded until July 23, 1997. She also submitted expenses for a June I, 1997 conference in San Francisco, California which were incurred prior to the implemenral of the program on July 2, 1997. Model Rule 8.4(c) provides that it is professional misconducl for a lawyer to engage in conduct dishonesty, fraud, deceit or involving misrepresentation.

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IJawyet' DisciplinaJ'y Actions 3. 11m Ms. Quirk's conduct violatoo Modd Rule 8A(d) when she: at the: request of George: "Nick~ Wilson, destroyed not'es to conceal the: participation of Mr. Wilson in the anornqad Iit'e:m program administert=d by Cc:ntal Arkansas Child Services. Inc. Modd Rule: 8A(d) provides that it is professionaJ misconduct for a lawye:r to e:ngage: in conduct that is pre:judicial to the: administration of justicc. WHEREFORE. in accordance: with me: consen! to discipline: prescntOO by M.s. Quirk and the: Executive Director, Stark Ligon. it is the: d«ision and orde:r of the: Arkansas Supreme Court Committ« on Professional Conduct that JoAnn C. Quirk, Arkansas Bar ID# 91175. be. and he:reby is. SUSPE OED FOR ONE YEAR from the practice of law for he:r conduct in this matter.

REPRIMAND

JOHN ATKINS CRAIN Mountain Home:, AR August 15,2001 The formal charges of misconduct upon which this Orde:r came 10 the anemion of the: Commine:e are dlle to testimony give:n in U.S. v. George Nicholas ~Njck" Wilson, e:t ai, Case No. LR-CR99-61. john Atkins Crain is an anorney practicing in Mounrain Home:, Baxte:r Counry. Arkansas. On March 9, 2000 and Augusl 29, 2000. Greta Blanke:nship testified in a case in the: United Srat(:S District Coun for the: Easte:rn Disuio of Arkansas sryled U.S. v. Gcorg~ Nicholas" ick" Wilson. e:t al, Case No. LR-CR-99-61. Sh~ testifie:d mat John A. Cnin worked for Murrey Gride:r to ~rform legitimate: work for the: Offi« of Child Support Enfor«me:nt (OSCE) in the: 14th judicial District. Mr. Crain was paid $2,000.00 per month to ~rform this work. In joly. 1995. Mr. Crain began to rt=ttive: monthly payme:nts of S5.625.OO. In january, 1996. the: momhly payment was inc~ to 56.250.00 per month. In mrn. Mr. Crain would ~kickback" to Nick Wilson a majority of that che:ck. The: amounts varied based upon a "stateme:nt~ Mr. Cnin ttte.ived from ick Wilson. This sche:me: ended in Nove:mber 1997. During this time: ~riod, Mr. Crain rc=ccived monthJy payments 10taJing $177.500.00, and. in turn. he: paid ick Wilson kickbacks lotaling $107,}40.00. For his response Mr. Crain stated that in July. 1994 he: met with Nick Wilson. Mr. Crain Stated that he: had JUSt been de:feated for r«lc=ction as Municipal judge and his wife: was te:rminal with cance:r at the time:. Mr. Wilson c=xplained to Mr. Crain that Mr. Wilson had a c1ie:nt. Molti Services, that would r«e:ive: a COlmaCt [Q furnish legal se:rvices for the: Office of Child Support Enforcement in the 14th judicial District. Mr. Wilson proposed to hire Mr. Crain. Mr. Crain stared that he would receive: $2.000.00 per month and thaI Mr. Wilson would charge: for a refe:rraJ ft=t= and divide the: attorney's fee as Wilson would be: su~rvising the: work. The: firsl year wen! according

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plan, and Mr. Crain assumc=d that Mr. Wilson paid his fee: by Muhi Services. In july, 1995. Murrey Gride:r took over the administration of Molti Services. Mr. Gride:r explainoo that Multi Services would no longe:r be: paying Mr. Wilson's ftt direct. Mr. Crain would receive a larger ch«k and Mr. Wilson would bill Mr. Crain. who woold pay the: bill OUt of the larger check. Mr. Crain r«eivoo the: large:r cht=Ck. Mr. Wilson's bill. and me:n paid Mr. Wilson according to the: bill. Mr. Crain statc=d thaI he rdied on Mr. Wilson's state:ments that this arra.ng~me:nt was required by fcde:r.tl and State: law. Mr. Crain admitred that the total fe:e receive:d from 1994· 1997 was SI77,OOO.oo. in which SI07.000.00 was passed on to Mr. Wilson. 1. That Mr. Crain's conduct violated Rule 1.5(e:) of the: Arkansas Model Rules of Professional Conduce when from july. 1995 to November, 1997. he: split fees e:arnoo from his c1iem. OSCE, WIth Gwrge: ~Nick" WIlson. Mr. Wilson did no work on the: account nor was the:re: any written agrceme:nt betw«n the: dtc=nt, Mr. Crain and Mr. Wilson acknowledging thaI Wilson was accepting responsibility for the: work. Modd Rule 1.5(e:) require:s that a division of fe:e: between lawyers who are not in the same firm may be made: only if: (I) the division is in proportion to [he services pttformed by each lawyer or, by wrinen agreement with the dielll. each lawyer assumes joim rc=sponsibility for the: re:presentation; (2) the: c1ie:nt is advised of and does not obje:ct to the: participation of all the lawyers involved; and (3) the: lotal fee is re:asonable. 2. That Mr. Cnin's conduct violat'oo Modd Rule: 8A(b), of the Arkansas Model Rules of Professional Conduct when from july. 1995 [0 Nov~mber, 1997. he: paid il1e:ga1 kickbacks to Grorg~ "Nick~ Wilson from funds Crain rec~ivcd from OSCE. These actions on his part we:re part of the fe:lonious acrion det'ailt=d in a Superceding Indictment 10 which Murrq Grider and Nick Wilson plc=ad guilty. Model Rule: 8A(b) provid(:S thaI il is professional misconduct' for a lawye:r to commit a criminaJ ace that reflectS adve:rsdy on the la 'Yer's honesty. trustworthiness or fitness as a la yer in othe:r respects. WHEREFORE. it is the: d«ision and orde:r of the Arkansas Supre:me: Court Commint=e on Professional Conduct that jOH ATKINS CRAl ,Arbnsas Bar #690 12. bc: and herc=by is REPRIMANDED for his conduct in this matte:r. to

\I,"IS

DANNY RAY WILLIAMS Little Rock. AR JUn<

25. 2001

The: formal charges of misconduct upon which this Orde:r is b3SC'd arose from the: complaint of

Judy Kay, Mason, dated AuguS! 22, 2000. Danny Ray Williams is an anorne:y with his office in Little: Rock. Pulaski County, Arkansas. On july 24, 1998, Mr. Williams filed a lawsuit, pro se. against the: City of Little: Rock (the City) and othe:rs in the: Unite:d States District Coun for

the: Easte:rn District of Arkansas. Mr. WiUiams c1aimoo that the: City violatoo 42 U.S.c. 1983. inte:r alia, in its dt=alings with the: rt=moval of ~e:raJ ve:hiclt=s ownoo by Mr. Williams. Mr. Williams signoo both the: complaint and ame:ndoo complaint acknowlooging that the: information presc=moo was accurate: and true:. Ms. Mason tq)resc=ntOO the: City. Mr. Williams allc=goo in his complaint that he: ownoo a ce:nain 1983 brontt BMW which was pro~rly insuroo as of june: 22. 1998. through Murual Servicc Casualty Insurancc Company. In bct, a ce:rtifioo copy of Mr. Williams' Murual Service: Casualty InsuranQ Policy history rdl«too that the: policy had bec=n canccloo on April 6. 1998. for non-paym~nt of the: policy's premium. Mr. Williams had F.tlsely presc:ntoo this same: ce:nifioo copy of insuranc~ on this vehicle: to police officers at the: tim~ of the: ae:nt that precipitatoo Mr. Williams's lawsuit. Additionally, Mr. Williams blsely allegoo in his lawsuit that an orange: 72 hour warning sticke:r placed on the: BMW citoo no legal aUlhority and failed lO provide: him with the: me:ans to question the impoundme:nt of this ve:hide:, whe:n in faCt, the: orange: stichr containoo the: words. "IN

ACCORDANCE WITH ACT 1000 OF 1993 ARKANSAS ODE ANNOTATED 27-501202." Mr. Williams also falsdyalleged that the: BMW was lOwed pursuant to a city ordinance and a coun orde:r, whe:n in fact. it was lowed pursuant to the: Arkansas Abandonme:nt Statutes. On August 26, 1998 and Nove:mber 25. 1998. Ms. Mason propounde:d sets of interrogatories and requests for production of docume:nts upon Mr. Williams. Mr. Williams fuiloo to file: any respollSl= to dthe:r set. despite: nume:rous requests by Ms. Mason that he: do so. On january 11, 1999. Ms. Mason wrote: Mr. Williams requesting his responses to he:r discove:ry requests and provided him with some: possible: dates for the taking of Mr. Williams's deposition. Anothe:r wrine:n requeste:d was mailc=d on january 27, 1999. which included a noti« to take: Mr. Williams's deposition on F~bruary 10. 1999. and for him to bring «min documents. Ms. Mason wrote: Mr. Williams again on january 29. 1999, and February 4, 1999. r~questing his di.scovc:ry responses. Mr. Williams appeared on F~bruary 10. 1999. for his de:position. He: f.Uled to bring the: requested docum~nts to the: deposition. Mr. Williams r~fused t'O answe:r c~rtain questions and mad~ untimdy and unreasonabl~ objections to certain questions. The: de:position was stOpped and the: Honorabl~ William R. Wilson was callat. judge: Wilson sche:dule:d a he:aring on the: discove:ry issu(:S for F~bruary II, 1999. At the: conclusion of that hearing. judge Wilson orde:red Mr. Williams to respond to all inte:rrogatories by the: 5:00 p.m. on February 19, 1999. Mr. Williams in o~n coun agre«! to resume his de:position on February 25. 1999. which corresponded with a notice: give:n to him on F~bruary 10, 1999. At 4:57 p.m .• Mr. Williams filed his discovery responses with the: ft=deral coun Clerk. He: ddive:rt=d the responses to Ms. Mason's office: at 5:45 p.m. that same: day. Mr. Williams did not ane:nd his

Lawyer Disciplinary Actions scheduled deposition of February 25. 1999. The next day a notice of deposition was sent to Mr. Williams by Ms. Mason rescheduling his deposition for March 10, 1999. He fajJed to respond or appear. Another notice was sent to Mr. Williams scheduling the deposition for April 8. 1999. Again. he failnt to respond or appear. On April 27. 1999. Ms. Mason filed a Motion and Brief to Dismiss based upon Mr. Williams's failure: to

comply with discovery which was granted by Judge Wilson on May 17. 1999. On May 24, 1999. a

Motion for Costs was filed by Ms. Mason due to Mr. Williams's fajlure to appear. Judge Wilson granrat the City $587.10 in COsts incurm:l. on June 21, 1999. At the time of the flIing of the complaint, Mr. Williams had made a partial payment of the COSts.

For his response Mr. Williams denied that there werc= allegations made mat ~re not bas«i on fuct. Mr. Williams affirmatively stated m.u Ms. Mason should have filed a motion under Rule II of the Federal Rules of Civil Procedure during the litigation or filed her complaim with the Comminet: al the conclusion of the litigation instead of waiting for fwO years. Additionally Mr. Williams ~ned that the federal judge did not make a complaint of Mr. Williams's conduct to the Committee. Mr. Williams stated that the discovery was tendered late. Mr. Williams stated the reason he did not attend the February 25 and March 10 deposition was due to Ihe bct he was in an automobile accident. Mr. Williams stated that he communicaled that bct to Ms. Mason. Mr. Williams staled he was unaWOlfC of any other deposition notice. Mr. Williams affirmatively asserted that his lawsuit was dismissed and the City awarded its COSts. Mr. Williams asserted that the complaint against him is motivated by a ~vendetfa" against him by the City due (Q a successful prosecution against certain City officials in Linle Rock Environmental Coun. In rebuttal, Ms. Mason stated that there was no vendetta. Ms. Mason denied that Mr. WiUiams ever communicated to her the vehicle accidem he aJleged, nor any other communication from him informing her of his inability to attend any deposition. Upon consideration the formal complaint, response herein, the lestimony of Judy Kay Mason and Mr. Williams and the Arkansas Model Rules of Professional Conduct, the Committee on Professional Conduct finds: I. That Mr. Williams's conduct violated Rule 3.4(d) of the Arkansas Model Rules of Professional Conduct when he fuiled to answer a S4:'t of interrogatories propounded on him on Augu$( 26, 1998, until ordered to by Judge William R. Wilson by February 19, 1999; when he biled to answer a set of imerrog':l.lories propounded on him on November 25, 1998, umil ordered to by Judge William R. Wilson by February 19, 1999; when he failed to bring Ihe documents requested in the Norice of Deposition to his February 10, 1999 deposition; when he unreasonably refused to answer

cenain questions propounded to him in his February 10, 1999 deposition; when he failed (0 appear at the resumption of his February 10, 1999 deposition on the mutually agreed date and properly noticed date of February 25, 1999; when he failed l'O appeat at the resumption of his February 10, 1999, deposition despite the fuct he was properly noticed to appear on March 10, 1999; and when he £ailed to appear for the resumption of the February 10. 1999 deposition despite the hici he was properly noticed to appear on April 8, 1999. Model Rule 3.4(d)requires th.at .a lawyer shall not in pretriaJ procedure, make a frivolous discovery request or fail IO make reasonably diligent efTon to comply with a legally proper discovery requesr by an opposing party. 2. That Mr. Williams's conduct violated Rule 8.4(d) of Ihe Ark.ansas Model Rules of Professional Conduct when, due to Mr. Williams's hiilure to respond to discovery and answer question posed to him in his February 10, 1999 deposition, Judge Wilson was required to conduct a hearing on Mr. Williams's fuilure to respond; when due to Mr. Williams hiilure to respond to the notices of deposition, opposing counsel was required to file a Motion and Brief to Dismiss Mr. Williams' lawsuit pursuant to Fed. R. Civ. P. 37, which Judge Wilson considered and gramed; and due 10 Mr. Williams' failure to attend the scheduled depositions, opposing Counsel was required ro file a Motion for Costs seeking reimbursement of the costs of the coun reponer. Model Rule requires mal .a l.awyer not engage in conduct that is prejudiciaJ to the .adminiut;J(ion of justice. WHEREFORE, it is the decision and order of the Arkansas Supreme Coun Committee on Professional Conduct rhar DANNY RAY WILLIAMS, Arkansas Bar #93148, be and hereby is REPRIMANDED for his conduct in [his maner.

KEW S. CASHION Pulaski County M,y 3. 2001 The formal charges of misconduct upon which this Ordet is premised arose from Information which came 10 me attemion of me Committet: concerning cermin of Kdli S. Cashion's conduct. Ms. Cashion is an anorney primarily pr.a.cticing in Pulaski County. The information which came to the anemion of the Committet: related 10 fwO (2) Motions to be Relieved which Ms. Cashion filed in the Uniled Stales District Coun, Eastern District of Arkansas, Western Division. The first of the Motions was filed on January 20, 2000, in the maner of Kristi Lynn Lindsey and Sus.an Carol Ellis v. Rodney Caner, case no. LR-C-99-479. In the Motion to be Relieved, Ms. Cashion made the following statements: "thaI the Petitioner jointly filed this action with her former parmer Carol Diane Sorton. That since the filing of this .action the partnership is no longer in existence." The Complaim on behalf of Ms. Lindsey and Ms. Ellis was filed during November 1999. The signature

page of the Complaint contains the signature of both Ms. Cashion and Ms. Sexton with the caption "CASHION & SECTION, Attorneys for plaintif[" The second Motion to be Relieved filed by Ms. Cashion was filed on April 18, 2000. in the marter of Louis Irby v. Kem Hardy, et al, case no. 99-CY00·882. In this Marion, Ms. Cashion makes the following stalements: ~That the Petitioner was attempting to enter into a partnership with Diane Sexton, Attorney at Law, at the time this action was filed. That since thai time no partnership was formed .and the Plaintiff has continued to be represented by Diane Sexton, exclusively." The Compl.aint in Mr. Irby's matter was filed on December I, 1999, afler the filing of the Complaint for Ms. Lindsey and Ms. Ellis. The signature block on the Complaint filed for Mr. Irby contains the same language that appears on the Complaint filed on behaJf of Ms. Lindsey and Ms. Ellis. Ms. Cashion was S4:'rved with [he formal complaint by certified, restricted delivery m.ail, pursuant to Section 5E. Procedures of the Arkansu Supreme Coun Regul.ating Professional Conduct of Attorneys al Law (Procedures) on January 10.2001. Ms. Cashion failed ro respond to the formal complaint. Her bilure to respond timely to the formal complaim constitutes admission of the factual allegations contained therein pursuant to Section 51(4) of the Procedures. Upon considet2tion of the formal complaint .and the Arkansas Model Rules of Professional Conduct, the Comminet: on ProfessionaJ Conduct finds: I. Thai Ms. Cashion's conduct violated Model Rule 7,5(d) when, ar a time when she was nOl partners with Ms. Sexton, Ms. Cashion signed pleadings implying that she was. Model Rule 7.5(d) requires that lawyers state or imply that they practice in a partnership or other organization only when that is rhe fact. 2. Thai Ms. Cashion's conduct violated Model Rule 8.4(c) when in a pleading filed January 19. 2000, she averred that she had been in .a partnership with Diane Sexlon COntrary to her own Statement of April 18,2000, thai no pannership ever came to be and when in a pleading filed April 18, 2000, Ms. Cashion stated thar she h.ad nor develoJXd a partnership with Diane Sexron directly conlt;Jd.icting her earlier statement in .a separ.a.le pleading that there had b«n a partnership. Model Rule 8.4(c) requires that a lawyer not engage in conduct involving dishonesty, fraud, deceit or misrepresentation. WH EREFO RE, it is the decision and order of the Arkansas Supreme CoUrt Commiuee on ProfessionaJ Conduct rhat KELLI S. CASHION, Arkansas Bar 1D '96006 be, and heteby is, REPRIMANDED for her conduct in this matter. In addition, Ms. Cashion is fined, as .a separ.a.re sanction for her failure to respond, pursuant to Sections 51(3) and 8A(2) of the Procedures, the sum of $1000. Said fine is due and pay.able within thirty (30) days of the date that this Order is filed.

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Lawyer' Disciplinary Actions Z1MMERY CRUTCHER Pulaski County

M.y 3,2001 The: formal charges of misconduct upon which this Order is premised arose from information which came to the anent ion of the Commirt~ concerning cerain ofZimmery Crutcher's conduCl. Mr. Crutcher is an anorney primarily practicing in Pulaski County. The information which came to the anemion of the Commin~ related to Mr. Crutcher's relationship with Richard Randle. The basis of the information before the Commi((~ was the oral deposition of Richard Randle on February 16, 1999, in the maller of Somhern Farm Bureau and Ricky Roberuon v. Richard Randle. The deposition was taken in connection with a bankruptcy proceeding in the United States Bankruptcy CoUrt for the Eastern and Western District of Arkansas, Pine Bluff Division, In rhe Maner of Richard Randle, debtor, case no. 98511598, The information before the Committee revealed that beginning in 1993, Richard Randle, d/b/a Randle & Associat'cs, was engaged in the business of performing minor building construction work such as painting and innalling sheet rock, wallpaper, border, molding, trim, elC. In April 1997, Mr. Randle obtained a paralegal certificate from Remington College. On April 12, 1997, Mr. Randle incorporated a business entity known as Independent Consulting Referral Service. During his deposition, Mr. Randle described the nalUre of his business as more or less revolving around personal injury. In addition, Mr. Randle explained mat his function was to offer help to a person injured in an automobile accident in finding an anorney. Mr. Randle's own testimony revealed that a lot of times he obtained information regarding automobile accidents from police reports and then he would sent a le1'l'er to the aceidem victim offering his referral services. The only attorney to whom Mr. Randle could remember referring cases was Mr. Crutcher. According to Mr. Randle, he would be hired to obtain information related to the accident if he made the referral. At no time during mis period did Mr. Randle have a private investig:nor's license and he did not engage in questioning individuals or taking statements. Mr. Randle Stated. that he charged S50 per hour for his services in obaining information. There were a number of checks drawn on bank accounts identified as Mays & Crutcher, PA.; Zimmery Crutcher, Jr., Attorney at Law; or, Zimmery Crutcher, Jr. Law Firm Trust Account and made payable to Mr. Randle. During his deposition, Mr. Randle professed lirtle knowledge or recollection of the reasons for the issuance of the checks to him. The checks wrinen on these accounrs from about March 30, 1998, through January 20, 1999, total $13,526.56. The testimony and the checks are indicative of a scheme and quid pro quo arrangement whereby Mr. Randle received compensation in the form of purported employmcnt in rcturn for his referral of legal

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business to your law firm. In his response to the formal complaint, Mr. Crutcher denied that Mr. Randle was ever provided any compensation for referring clients to his law firm. The fees paid to Mr. Randle were solely for his courier services, according l'O Mr. Crutcher. It was Mr. Crutcher's testimony that he needed Mr. Randle's S(:rvices becaUSC' of the large personal injury practice that he had in Jefferson County, Arkansas, where Mr. Randle was located. Upon consideration of the formal complaint, me response herein, and the Arkansas Model Rules of Professional Conduct, the Commil1ee on Professional Conduct finds: I. That Mr. Crutcher's conduct violated Model Rule 1.1 5(a) when he disbursed monies from funds hdd in his trUSt account 1'0 Richard Randle, a person who was neither a diem nor a mird party having an intcrest in such funds, to wit: (i) Check Number 10206 in the amount of $250; (ii) Check Number 10209 in the amount of $125.00; (iii) Check Number 10214 in the amount of S291; (iv) Check umber 10217 in the amount of $669; (v) Check Number 10231 in the amount ofS100; and, (vi) Check Number 10277 in the amount of $666.50. Model Rule 1.15(a) requires thaI all lawyers hold property of clients or third persons thaI is in a lawyer's possession in connection with a reprcsentation sepaT3tC from the lawyer's own property and also requires that funds of a dient be deposited and maintained in one or more identifiable trUSt accounts in the stare where the lawyer's office is situated, or elsewhere with the consent of the client or third person but prohibits the lawyer or law firm from depositing funds belonging l'O the lawyer or law firm in any account designated as the trUSt account, other than the amount necessary to cover bank charges, or comply with rhe minimum balance required for the waiver of bank charges. 2. 11m Mr. Crutcher's condua violated. Model Rule 7.2(d) in that he paid over monies to Richard Randle through an arrangemem whereby Richard Randle purportedly was hired to perform investigative or other minor services in conn~tion with legal matters in which he had referred the client or clients to Mr. Crutcher's law firm, to wit: (i) On March 30, 1998, a check was wrinen to Mr. Randle in the amount of S J 208 from the Mays & Crutcher, PA, checking account; Oi) on April 16, 1998, a check was written to Mr. Randle in the amount of $300 from the Mays & Crutcher PA checking account; (iii) on April 25, 1998, a check was wrinen to Mr. Randle in the amount of Sioo on the Mays & Crutcher PA checking account; (iv) on May I, 1998, a check was issued to Mr. Randle in the amount of S200 on the Mays & Crutcher PA checking account; (v) on May 18, 1998, a check was written to Mr. Randle in the amount of $771 on the Mays & Crutcher PA checking account; (vi) on June 19, 1998, a check was wriTten 1.0 Mr. Randle in the amount of $250 on the Mays & Crutcher PA checking account; (vii) on June 19, 1998, a check was written to Mr. Randle from the Mays & Crutcher PA checking account in lhe amount of

S1000; (viii) on July 8, 1998, a ch~k was wrinen to Mr. Randle in the amount of $650 on the Mays & Crutcher PA checking account; (ix) on July 11, 1998, a ch~k was issued to Mr. Randle from the Mays & Crutcher PA ch~king account in the amount ofS600; (x) on July 17, 1998, a ch~k was issued to Mr. Randle from the Mays & Crutcher PA checking account in the amount of$270.50; (xi) on July 21, 1998, a ch~k was issued from the Mays & Crutcher PA checking account in the amount of S978 payable to Mr. Randle; (xii) on July 31, 1998, a check was issued from the Mays & Crutcher PA checking accoum in the amount of$413 payable to Mr. Randle; (xiii) on August I, 1998, a check was issued form the Mays & Crutcher PA checking account in the amount of $666 payable to Mr. Randle; (xiv) on August 6, 1998, a check from the Mays & Crutcher PA checking account in the amount of 5250 was issued to Mr. Randle; (xv) on August 19, 1998, a check was issued to Mr. Randle from the Mays & Crurcher I)A checking account in the amount of S708; (xvi) on August 20, 1998, a check was wrinen to Mr. Randle in the amount of S183 form the Mays & Crutcher PA checking account; (xvii) on August 28, 1998, a check was issued to Mr. Randle in the amount of $585.50 form the Mays & Crutcher PA checking accoum; (xviii) on September 10, 1998, a check was wrinen in the amount of 52185 to Mr. R.'lndle from Mr. Crutcher's law firm trust account; (xix) on September 21, 1998, a check was written in the amount of$250 to Mr. Randle from your law firm trust accpunt; (xx) on September 21, 1998, a check was written in the amount of 5125 to Mr. Randle from Mr. Crutcher's law firm trust account; (xxi) on September 21, 1998, a check was writTen in rhe amount of$291 to Mr. Randle from Mr. Crutcher's law firm rrust account; (xxii) on September 23, 1998, a check in the amount ofS669 was written to Mr. Randle from Mr. Crmcher's law firm truSt account; (xxiii) on OclObe.r 23, 1998, a check was wrinen in the amount of Sioo to Mr. Randle from Mr. Crutcher's law firm trust account; (xiv) on December 21,1998, a check was wrinen to Mr. fUndle in the amount ofS666.50 on Mr. Crutcher's law firm trust account; and, (xv) on January 20, 1999, a ch~k was wrinen to Mr. Randle in the amount ofS 107.06 on Mr. Crutcher's law firm operuing account. Model Rule 7.2(c) requires, in perrinent part, that a lawyer not give anything of value to a person for recommending the lawyer's services. WHEREFORE, it is the decision and order of the Arkansas Supreme CoUrt Committee on Professional Conduc1 that ZIMMERY CRlITCHER, Arkansas Bar 10 #74029 be, and hereby is, REPRIMANDED for his conduct in this maner. ANN DONOVAN Fayeneville, AR

M.y 26, 2001 The formal complaint of misconduct arose from the complaint of . Clay Hubbard. Mt. Hubbard

Lawyer Di8ciplinary Aution8 emered into an agr~mC'm with Ann Donovan.

Anomer at Law, Fayen~iUc:. Arkansas. for Ms. Donovan to act as trustee of money belonging to Mr. Hubbard. On avember 9, 1996. Clay Hubbard ddiver«t t'O Ann C. Donovan, $42,000 in the form ofa check in the amoun! of $17.000 dr:awn on the account of Hubbard Properties and $25,000 in cash. The money from Hubbard Properties was from Mr. Hubbard's siSler. The $25,000 was proceeds from a viatica! settlement. A receipt was signed by Ms. Donovan, Mr. Hubbard, and a witness, Kevin KitC'. The trUSt agreement W2S an informaJ agrttmc=nt wherein Ms. Donovan would distribute funds to

Mr. Hubbard upon requesT. From November 1996 through June 1998, Ms. Donovan provided Mr. Hubbard with funds in the form of monq- orders or

checks. In July, 1998. Mr. Hubbard ~n1 Ms. Donovan a lettcr requesting that she deliver the. ~maining procec.ds to him no later than July 25, 1998. According to Mr. Hubbard, Ms. Donovan did nOI respond to the lener. Mr. Hubbard, a r ide.m of Dallas, Toras, callc.d Ms. Donovan on September 14. 1998 in a final auempl to obtain the funds in Ms. Donovan's possession. According to Mr. Hubbard, Ms. Donovan stated that she was finishing an accounting of the funds and that she would have a check to him by the end of the week. Mr. Hubbard received no accounting and no funds from Ms. Donovan. Mr. Hubbard, a resident of Dallas. Texas, employed a Dallas attorney 10 assist him in recovering funds in Ms. Donovan's possession. A letter was prepared by the Dallas attorney and ~nt to Ms. Donovan demanding return of the funds. Ms. Donovan did nOt reply to the demand lefler. Mr. Hubbard wrote Ms. Donovan again in March, 1999, and demanded the return of his funds in her possession. Again. Ms. Donovan failed to respond to his requesl. In March 2000, Mr. Hubbard comaac.d the Office of Professional Conduct and explainc.d Ms. Donovan's conduct. On March 28, 2000, the Executive Director of the Office of Professional Conduct wrote Ms. Donovan on Mr. Hubbard's behalr. Ms. Donovan failed to respond to the request of lhe Executive Director. Ms. Donovan responded to the Complaint from the Office of Professional Conduct and stated that she did not bdieve that she was acting in any capacity other than as a trust« and thaI if she did have a dient, the diem was Kevin Kite. Ms. Donovan stated that it was her understanding that the funds we~ to be made available to Mr. Hubbard for medjcal and mher necessary expenses but we~ not to be ddi~rc.d at Mr. Hubbard's request bur al the direction of Kevin Kile. Ms. Donovan acknowledged receipt of letters from Mr. Hubbard and she informed Mr. Kite of receipt of the letrers. According to Ms. Donovan, she informed Mr. Hubbard thai the figures he demanded and the amount she believed was in her possession were not the same and d13t she wanted to check her records Ms. and discuss with Mr. Kite what to do.

Donovan beJieved thai she had administeml. the funds as she agr«d. to do so and had nOt bttn dir«red to do otherwi~ by Mr. Kite. An evidentiary hearing was ~t for March 16, 2001 in the marter. Prior to the hearing, Ms. Donovan was subpoenaed to provide all records relaling to the deposit of the $17.000 check drawn on Hubbard Properties and the $25.000 cash; all checks written and made payable to Mr. Hubbard or Mr. Kit'e; aU records maintained by Ms. Donovan demonstrating the outstanding balance of funds provided 10 her by Mr. Hubbard; and a copy of an Application to the Internal Revenue Service for an Employer Identification Number for Ihe Trust. The information was to be provided on or before December 28, 2000. On December 28, 2000. Ms. Donovan faxc.d a copy of the Application for Emplo~r Identification umber to the Office of Professional Conduct. The olher information requestc.d in the subpoena was not provided as Ms. Donovan Stated that the information was in smrage and, due to the then existing wC::l.lher conditions, she was unable to access. On March 7. 2001, Ms. Donovan provided copies of money orders. checks, and payments made from Mr. Hubbard's money. At an evidentiary hearing on March 16, 2001, Ms. Donovan appeared and was questioned concerning the amounts received by her, the amounts paid to Mr. Hubbard and Mr. Kite, and lhe balance of funds in her possession. Ms. Donovan stated that she had known Mr. Kite for a period of lime and that he was concern~ about Mr. Hubbard's lISt of his money and suggested the creation of a trust for Mr. Hubbard's behalr. Ms. Donovan agreed to act as trust«. Ms. Donovan stated that she wenl to a friend's house in Fayetteville fot a Razorback foolball pl"e-game party where she met Mr. Hubbard and Mr. Kite. Ms. Donovan admitted to receiving the $42,000 at the pre·g.me pany, placN it in a safe place at the mutual friend's house, and wC'nt 10 the game. Following the game. Ms. Donovan took the check to the bank, cashed the check, and placed the $17,000 cash with the $25,000 cash in her sock drawer at home. Based on the information Mr. Hubbard provided and the information provided by Ms. Donovan through subpoena, it was calculated that there should be $10,897.35 belonging to Mr. Hubbard in Ms. Donovan's possession. Ms. Donovan testified thai there may have ~n one or £wo additional payments for which she did nO( have copies of money orders which may have tou.lc.d 52,000.00. Ms. Donovan lestified that the money was currently in a safe al her home and that she currently had in her possession $9.500.00 belonging t'O Mr. Hubbard. Following the conclusion of the deposition. the Committ« met in execulive session. Upon returning from executive session, the Committee gave Ms. Donovan the choice of returning to Fayeueville and delivering a cashier's check in the amoul1l of $9500 to the Office of Professional Conduct by the close of business on March 23, 2001. and receiving a reprimand, or facing a suspension of her license to practice law. On March

20, 200 I. Ms. Donovan providc.d a cashier's check in the amount of $9.500.00 to the Office of Professional Conduct. Upon consideration of the formal complaint, the respon~ thereto, and the Arkansas Model Rules of Professional Conduct, the Committee on Professional Conduct finds: I. That Ms. Donovan's conduct violated Model Rule 1.2(a) when the objective of the representation of Mr. Hubbard was t'O hold his funds in trust and deliver them as requested. Model Rule 1.2(a) requires, in pertinent part, that a lawyer abide by a client's decisions concerning the objective representalion and consult with the dient as to the means by which they are to be pursu~. 2. That Ms. Donovan's conduct violated Model Rule 1.3 when she failed for over thr« (3) years to return the remaining balance of Mr. Hubbard's funds after he made a written request for his funds to him. Modd Rule 1.3 requires that a lawyer act with reasonable diligence and promptness in representing a client. 3. That Ms. Donovan's conduct violated Model Rule 1.4(a) when she failed to respond to Mr. Hubbard's requestS for informal ion aboul the balance of Mr. Hubbard's funds. Model Rule 1.4(a) requires thai a lawyer keep a dient reasonably informed about the StatuS of a maller and promptly comply with reasonable requests for information. 4. ThaI Ms. Donovan's conduct violated Model Rule 1.15(a) when she f.liled to maintain Mr. Hubbard's funds as agreed to by her. Model Rule 1.15(a) requires, in pertinem part, that all lawyers hold propeny of dic:nts or third persons that is in a lawyer's possession in connection with a representation separate from the lawyer's own propeny with funds of a diem requiml. to be deposited and maintained in one or more identifiable trust accounts in the state where the la~r's office: is situatc.d, or e1srwhere with the con~nt of the dien t. 5. Thai Ms. Donovan's conduct violated Model Rule 1.15(b) when she failed 10 promptly ddiver the balance of Mr. Hubbard's funds to him despite numerous requesls to do so and when she failed 10 provide Mr. Hubbard or his designated representatives with a full accounting concerning the balance of his funds in which she was entrusted. Model Rule 1.15(b) requires. in pertinent part, with regard to funds in which a dient has an interest, that orce:pt as stated in this Rule or otherwi~ permitted by law or by agreement with the dient, a lawyer promptly ddi~r to the dient any funds that the diem is entitlc.d to receive and, upon request by the diem, promptly render a full accounting regarding such property. 6. That Ms. Donovan's conduct violatc.d Mood Rule SA(c) when she faI~ly adviso:l Mr. Hubbard on more lhan one occasion that she was going to ~nd him lhe balance of his funds. Modd Rule SA(c) provides that a lawyer shall not engage in conduct involving dishoneSty, fraud, deceit or misrepresentation. WHEREFORE, it is the decision and order of the Arkansas Supreme Court Committee on

I'll. II III. llFall 200 I

LawYel' Disciplinal'y Actions Professional Conduct that ANN DO OVAN, Arkansas Bar ID #78043, be, and hereby is, REPRlMA OED for her conduct in this matter.

DAVIS HENRY LOITIN Wesr Memphis, AR May 3. 2001 The formal charges of misconduct upon which this Order is premised arose from the Contempt Order of the: Arkansas Supreme Coun, on December 14, 2000, in the matter of Oyde Johnson v. State of Arkansas, CR 00-815. In the Contempt Order, the Arkansas Supreme Coun set out that Davis Henry Loftin, an attorney praclicing primarily in West Memphis, appeared before them and emered a plea of guilty to a Show Cau.sc= Order. Mr. Loftin appeared before the: Coun on December 7, 2000. The conduct to which Mr. Loftin entered a plea of guilty was Ihe failure: to pursue an appeaJ for Clyde Johnson after filing a Notice of Appeal for Mr. Johnson in 1991. In his responS(' to the Commincc, Mr. Loftin admitted that he did file a Notice of Appeal for Mr. Johnson bur that he did not proceed with the appeal because he believed that Mr. Johnson did nOt wish for him to do so. Upon consideration of the formal complaint, the response herein, and the Arkansas Model Rules of Professional Conduct, the Committee on Professional Conduct finds: I. Thar Mr. Loftin's conducr violated Model Rule 3.4(c) since his conduct in failing to pursue an appea.l for Clyde Johnson was determined to be contempt of the Arkansas Supreme CoUrt. Model Rule: 3.4(c) requires that a lawyer not knowingly disobey an obligarion under the rules of a rribunal except for an open refusal b:.lSed on an as.senion that no valid obligation exists. 2 That Mr. Loflin's conduct violated Modd RuJe 8.4(d), to wit: (i) His failure to pursue an appeal on behalf of Clyde: Johnson led to a substandal delay in the administration and rt:SOlution of his appellate procccding; and, Oi) Based upon his failure to timely pursue Mr. Johnson's appeal of his 1991 conviction, the Supreme Coun was ~uirtd to conduce a show calJS(' hearing which would not have been necessary otherwi~. Model Rule 8.4(d) requires that a lawyer not engage in conduct that is prejudicial to the administr.ltion of justice. WHEREFORE. it is the decision and order of the Arkansas Supreme Coun Committee on Professional Conduce that DAVIS HE RY LOFTIN, Arkansas Bar ID #79196 be, and hereby is, REPRIMANDED for his conduct in this marrero

DOYLE L WEBB, II Iknton, AR May 31, 2001 The formal charges of misconduct upon which this Order is premised arose from information coming to the attention of the Comminee on June 28, 2000, by way of a Judicial Referral made by Honorable Robert Garrett, Honorable Gary Arnold

路18 TIe lrkllw LIMj/f Mww.lrklm,.

and Honorable: Grisham Phillips, Circuit and Chancery Judges for Saline County. The information related to cerra.in of Doyle L Webb's conduct in his relationship with Merle S. Salberg, prior to her death, and later as Executor of her (':S[are. Mr. Webb is an anorney primarily practicing law in Bemon, aline County. In addition, information was provided in the form of an affidavit executed by Kathryn La. eUe Wilson Maunder, niece of Ms. Salberg. and her sole heir ar law. The information provided demonsrrared that Mrs. Merle Salberg, a long-time widow, died on December 18, 1996, at the age of eighty.six years. On January 8, 1997, Mr. Webb, as the executor nominated in her 1993 Will, filed a Petition for Probate: of Will and Appointme:nt of Personal Repr~mative in the Estate of Merle: S. Salberg, dteeased, Saline Probate o. 97-007路3. On the S3me day that Mr. Webb filed the Petition, he also filed the 1993 Last Will and Testament of Mrs. Salberg, along with the 1996 Codicil thereto. The 1993 Will indicated. on its face, that it was prepared by Mr. Webb of "Webb Doerpinghaus Brown, Attorneys al Law." The 1996 Codicil indjcated, on its face, that it was prepared by Charles J. Docrpinghaus, Jr. of "Webb & DOt:rpinghaus, Altorneys at Law." The 1993 Will left Mrs. Salberg's residuary estate, including her house, alllomobile, personal effeclS, jewelry, furnishings in me house, and Stocks in my (her) name, to her ni芦:e, LaNelie Mazander. The Codicil, which was executed on January 3, 1996, left the residuary estate, including her houS(', automobile, personal effects, jewelry, and furnishings in the house (hul omitting "and stocks in my name"), to Webb. Mr. Webb got all of her estate except for cerra.in joint survivorship bank accounts left to Richard Salberg, Jr., to LaNelle MaZOlnder, and to her son Alan Mu.ander. Afler filing the Petition, Mr. Webb sent the three a documenl enritled Waiver of Invemory, Accounting and otice. Each of the three signed their own individual Waive:rs, which were thereafter filed of record by Mr. Webb. The only distributions from the Salberg estate: were made to Webb. The Order authorizing final distribution and closure of Mrs. Salberg's Estate was entered of record. on Augus'7. 1997, by M,. Webb. According to the Judges who reported Mr. Webb, rumors persisted in Saline County for some time about Mr. We:bb's involvement in Mrs. Salberg's estate. Mr. Webb explained that he was unaware of any such rumors. When the: Judges initially htard the rumors, they did not report the: conduct because they did nor believe the rumors themselves constituted a "substantiallikdihood that a lawyer has committed a violation of the rules" as contemplated by the: provision of the: Arkansas Code of Judicial Conduct requiring the reporting of an anorney's conduct. However, after being contacted by a law enforcement official on June 14, 2000, a decision was made by the Judges that further inquiry was required. On June 19, 2000, the Judges took Mr. Webb's statement concerning Mrs. Salberg's estate. During the meeting, Mr. Webb explained rhal he had known Mrs. Salberg for

approximatdy twenty.five (25) years and that he had been her lawyer for a number of years prior to her death. In his response to the Committee, Mr. Webb explained that Mrs. Salberg had been a friend to his parents. Mr. Webb also offered his explanation concerning the circumstances leading to the changing of the residuary dau~ in Mrs. Salberg's Will. According to Mr. Webb, Mrs. Salberg first approached him on December 15, 1995, about changing the c1au.sc= to make him irs beneficiary. The djscussion [(>ok place in Mrs. Salberg's home. Mr. Webb rttalled that after discussion of Mrs. Salberg's physica.l condition and thl: location of certain impornmt papers in her homl:, Mrs. Salberg told Mr. Webb that she would like for him (0 become the residuary beneficiary of hl:r estate. Mr. Wl:bb advised thl: judges that he informed Mrs. Salberg that he rouJd not prepare an instrument in which he was a bendieiary. According to Mr. Webb, Mrs. Salberg then inquired of Webb whether Charles Docrpinghaus could do it for her. At thl: time, Mr. Doerpinghaus was renting space from Mr. Webb and his name appeared with Mr. Webb's as "Webb & Doerpinghaus, Attorneys at Law." According to Mr. Wl:bb, Mr. Doerpinghaus also reimbursed him for a portion of Cheryl Nuno's services as a receptionist and other expenses. Mr. Webb denied that he and Mr. Doerpinghaus ever shared fees. He also stated that hI: did not believe thl: uS(' of joint lenerhead indicated that he and Mr. Doe:rpinghaus were partners. Further, Mr. Webb explained to the Judges that he believed Mrs. Salberg wished to leave property to him beauS(' of work he had done for her or was going to do for her. Mr. Webb also asserted thaI he did not believe the residuary claUS(' would convey very much property. After Mrs. Salberg's death, Mr. Webb opened up her home to the heirs and advised that he would diS3vow any imcrest in the escare if any heir had an objccrion to the lxquest made to him. No such obj~cion was presented to Mr. Webb. It was Mr. Webb's statement to the Judges that it was only when he was going through Mrs. Salberg's personal belongings that he found some Stock certificates. Mr. Webb was unable to S2y exaCtly how much he inherited from Mrs. Salberg's estate but it was approximately twO to three hundred thousand dollars. Mr. Webb admitted that he never informed Mrs. Salberg's family the size of the residual estate. He also advised that he was never asked to discl()S(' that information. At the hearing Webb Slated he did not inform Nell Mazander or the other two rdatives of the stock Webb found, beause they had signed waivers shortly after the mccting with him at his office and becau.sc= Ms. Salberg's Will did not ~uire him to file an inventory of estate assets. Mr. Webb informed the Judges that he could repay the money ifhe had to do so, bur that it would take him awhile ro get the money together. Mr. Webb admjned that Mr. Doerpinghaus shared office space with him and also shared lenerhead. Mr. Webb acknowledged thar there was an apparent connict of interest in having Mr. Doerpinghaus prepare the Codicil bur since Mrs. Salberg was aware of the shared office

Lawyer Disciplinary Actions space, Mr. Webb believed that she had waived any conflict. Although Mr. Webb was requested to provide the Judges with his own memorandum confirming rhe discussion at the meeting, he did not

do so. According 10 Mr. Webb, he intended to provide a statement concerning the m~ting. When Mr. Webb learned the Judges intended to report the maner co the Commin~. he decided (0 present his starement to the Comminee. Following Mr. Webb's statement, the Judges look rhe statements of three other potential witnesses, Tim lenders, Cheryl NUllO and Charles Docrpinghaus. At the hearing Webb conceded at least a technical violation of Modd Rule 7.5(d) on the firm name and letterhead. and accepted responsibility for being in violation, saying it was nOl his intent to mislead the public. He acknowledged that there is no outward difference between the firm name and leuerhcad forms of his presenr, admiucd "partnership" with George Ellis in "Ellis & Webb" and in "Webb & Docrpinghaus," which he claims was never a partnership. On June 20, 2000, Mr. Jenders, former long~ lime paralegal to Mr. Doerpinghaus, provided a sworn statement to the Judges. According to Mr. Jenders when he, Mr. Docrpinghaus. Ms. Nuno and Ms. Ronaee Hunt. a Webb employee, drove to Mrs. Salberg's home for execution of the Codicil, Mr. Ifixrpinghaus said that he was standing in for Mr. Webb. Mr. Jenders recalled that Mrs. Salberg mentioned that she trusted Mr. Webb, that Mr. Webb was in her church and that she believed Mr. Webb would do the right thing with the money. Mr. Jenders had no recolleclion of preparing the Codicil for Mr. Doerpinghaus or at his request, which would have been the norm if it was a document being prepared for Mr. Dmrpinghaus or at his request. Mr. Jenders reported that Mr. Doerpinghaus gave him the dear impression that he was doing all of this for Mr. Webb. On June 21, 2000. the Judges rook the statement of Cheryl (Best) Nuno. According to Ms. Nuno, she prepared the Codicil at the request of Mr. Webb. She explained that she prepared it at Mr. Webb's instruction after he met with Mrs. Salberg. Ms. Nuno also related that her recollection was that there was discussion in the office that it would not be proper for Mr. Webb to be present at Mrs. Salberg's when the Codicil was executed. According to Ms. Nuno. Mr. Webb requested that she get the Codicil signed while he was out of town. Ms. Nuno confirmed this event in her September 21, 2000. affidavil. and again at the hearing. Mr. Webb acknowledged at the hearing thai he made this request of Ms. Nuno during a ClSual conversation when he saw the Codicil on her desk. Ms. Nuno also advised that she had no recollection of ever preparing any pleadings or other legal documents for Mr. Docrpinghaus. On behalf of Mr. Webb, Ms. Nuno submitted an Affidavit (Q the Committee dated September 21, 2000. According ro Ms. Nuno's affidavit, she does not believe that Mr. Webb was involved in the preparation of the Codicil for Mrs. Salberg. Her recollection in the Affidavit is that Mr. Webb. Mr. Doerpinghaus and she talked

about the Codicil. Ms. Nuno explained that she believed her Affidavit more accllTatcly reAected what happened, inslead of the statement to the Judges which was given over the telephone withom the opportunity 10 reflect upon the events which occurred over four (4) years ago. At Ihe hearing Ms. Nuno said the only change from her sworn statement to the judges that her affidavit was offered to correCI was that Mr. Webb had instructed her in the preparation of the Codici1. At the hearing she stated she had prepared the Codicil at the request of Mr. Docrpinghaus. On June 23, 2000. the Judges took the sworn S[alemenr of Charles Doerpinghaus. Mr. Doerpinghaus asserted that he spent between 30 and 45 minutes at a private mC(:ting with Mrs. Salberg and that she explained to him what she wanted to be done in the Codicil. It was Mr. Doerpinghaus' recollection thar he also explained the possible conflict of intercst he had through his relationship with Webb to Mrs. Salberg at both this meeting and again prior to execmion of the Codicil. Ar the hearing Doerpinghaus indicated there may have been some situations where Webb and he shared fees, or adjusted accounts between them for rent and other shared expenses, when Doerpinghaus handled some cases for Webb when Webb could nOI a['(end coun. Mr. Webb steadfastly denied that he prepared the Codicil or that he caused the Codicil [Q be prepared in violation of Arkansas Model Rule 1.8(c). He also denied that there was a violation of Arkansas Model Rule 1.10(a), because neither he nor Mr. Doerpinghaus considered themselves pan of a firm. Mr. Webb did admit that the letterhead utilized at the time complained of herein carried the names of "Webb and Doerpinghaus," but he did nOI believe that represented to anyone that Mr. Doerpinghaus and he were partners. At Ihe hearing the evidence developed that Webb may have received as little as $300,000 and as much as $320,909 (gross) from the Salberg Esrate. He affirmed that he found the Salberg stocks in her house between the family conference al his law office on December 23. 1996, and January 20, 1997, when he tendered the Stocks to the local office of Edward Jones & Company. where they were valued at $198,325 as of January 31. 1997. Webb also stated that he never tOld anyone. other than Edward Jones & Company, of the e"istence of the stOcks or their value until his interview with the judges in June 2000. Other assets Webb received through the Salberg estate were: her house (sold for $80,000 gross in June 1998); her automobile (sold fo, $7,000 '0 Rich",d Salberg, j,. in May 1997); personal effects and furnishings (sold at auction August 1997 for $2.746 net); stock dividends on the Edward Jones account through Augusl 1997 of $1.928; Union Bank savings account No. 29977 of $8,421; Union Bank checking account No.1 05400 with an estimated net of $21,149 after paying horne health care bills; and Ms. Salberg's 1996 federal income tax refund of$I,340. At the hearing Webb claimed unitemized expenses as executor against the assets he received.

Upon consideration of the formal complaint. the response thereto, evidence produced at the hearing May 17 18, 200 J, and the Arkansas Model Rules of Professional Conduct, the Committee on Professional Conduct finds: I. That the conduct of Doyle L. Webb, II. violated Model Rule 7.5(d) when he and Mr. Doerpinghaus held themselves out to be in Ihe partnership of "Webb and Doerpinghaus" on letterhead, the Salberg 1996 Codicil. and other documents even though they assert that they were not actually partners in 1995-1996, or at any 01 her time. Model Rule 7.5(d) requircs that lawyers may state or imply that they practice in a partnership or other organization only when that is the faCI. 2. That the conduce of Doyle L. Webb. II, violated Model Rule 5.3(c). Cheryl Best (now Nuno) and Ronaee Hunt (now Hamby) were employed at all limes relevam hereto by Doylc Webb's law firm as his legal secretary/receplionist and his paralegal, respeclively. Hunt was one of twO witnesses to the January 3. 1996, execution of her Codicil by Merle S. Salberg, and Best notarized the signatures to that instrument of Mrs. Salberg and her twO witnesses. The acts performed by Best and Hunt were acts that could not have been performed by Doyle Webb without violating the Model Rules under the faCtS of this case. Webb ratified the conduct of these twO employees of his law firm and he is responsible for their conduct, which would be a violation of the Model Rules if engaged in by Mr. Webb. Model Rule 5.3(c) provides that with respect to a non-lawyer employed or retained by or associated with a lawyer, a lawyer shall be responsible for the conduct of such a person that would be a violation of the rules of professional conduC1 if engaged in by a lawyer, if the lawyer orders, or with the knowledge of the specific conduct, ratifies the conduct involved. 3. That the conduct of Doyle L. Webb. II, violated Model Rule 8.4(a). Knowing the Model Rules prohibit him, or his law firm, from preparing a Codicil for Mrs. Salberg to execute that would leave Webb a substantial testamentary gift, through his acts and those of his law firm secretary Cheryl Best and his paralegal RonaC(: Hunt. Webb assisted Charles Ifixrpinghaus, a lawyer associated wit'h Webb. in preparation and execution of the Salberg Codicil. Cheryl Best prepared the Codicil, and probably frolll a previous Codicil prepared in 1994 for Salberg by Webb. According to her affidavit, Best, at Webb's suggestion, told Doerpinghaus it was time to get the Salberg Codicil executed while Webb was out~of-Iown in early January 1996, which action was Ihereafter promptly accomplished. Model Rule 8.4(a) provides it is lawyer misconduct for a lawyer 10 violate or attempt to violate the rules of professional conduct, knowingly assist or induce another to do so, or do so through the acts of another. 4. That the conduct of Doyle L. Webb, II, technically violated Model Rule 1.10(a), bUI the Comminee assesses no sanction for this violation. Charles Doerpinghaus, a lawyer associat'ed with Doyle Webb, had the Codicil prepared and

fol. l6 SI. 4/I'all tOO1 The ,Irkmas I,a"yer

,19

Lawyet' Disciplinal'y Actions presented to Merle Salberg, and executed by her on January 3, 1996. Doyle Webb was prohibited from doing these acts himself by Model Rule 1.8(c). As an anorney associated with Webb, Doerpinghaus also was prohibited from doing these acts, unless the conflict of interest was waived by Mrs. Salberg. The Comminee finds Doerpinghaus explained to Mrs. Salberg the relationship between Webb and he sufficiently and that she waived any conflict of imerest in Doerpinghaus handling her Codicil. Model Rule 1.1 O(a) requires, in pertinent part, that while lawyers are associated in a firm, none of them shall knowingly represent a client when anyone of them practicing alone would be prohibited from doing so by Rules 1.7, 1.8(c), 1.9,2.2, or 3.7. 5. Bya vote of 4*3, that the conduct of Doyle L. Webb, II, did not violate Model Rule 8.4(c), when Webb, as executor of the Merle Salberg Estate, failed to disclose to Kathryn LaNeIJe Mazander, the sole heir at law of Merle Salberg and the former residuary beneficiary under her 1993 Will, the existence of stocks valued at $198.325.00 in the name of Merle Salberg that Webb found in Mrs. Salberg's house on or before January 20, 1997 after her death. Mr. Webb had provided Ms. Mazander a waiver of inventory, accounting and notice of probate proceedings in the Salberg Estate, which she executed and which he filed for her on January 21, 1997. Model Rule 8.4(c) provides a lawyer shall not engage in conduct involving dishonesty, fraud, deceit, or misrepresentation. 6. That the conduct of Doyle L. Webb, II, did not violate Model Rule 1.8(c), when the 1996 Codicil to Mrs. Merle Salberg's 1993 Will was prepared by Charles Doerpinghaus, an attorney associated with Mr. Webb. The Codicil resulted in Mr. Webb receiving at least $300,000 in assets from Mrs. Salberg's estate. Model Rule 1.8(c) requires, in pertinent part, that a lawyer nOt prepare an instrumem giving the lawyer any substal1tial gift from a dient, including a testamentary gift, except where the client is related to the donee. 7. That the conduct of Doyle L. Webb, II, did not violate Model Rule 1.7(d). Mr. Webb while acting as executor, anorney, and sole beneficiary of the estate of Merle Salberg, learned an assets of the estate was stocks valued at $198.325.00, a fact which he disclosed to no one, including Kathryn LaNelle Maunder, the sole heir at law of Mrs. Salberg and the former sole beneficiary under her 1993 Will. Model Rule 1.7(b) provides a lawyer shall nOt represent a client if the representation of that client may be materially limited by the lawyer's responsibilities to another client or to a third person, or by the lawyer's own interests, unless (I) the lawyer reasonably believes the representation will not be adversely affected; and (2) the client consents after consultation. When representation of multiple clients in a single matter is undertaken, the consultation shall include explanation of the implications of the common representation and the advantages and risks involved. WHEREFORE, it is the decision and order of the Arkansas Supreme Court Committee on Professional Conduct that DOYLE L. WEBB, II,

50 Tie lrkalSls LaWf!r

www.ark~ar.ClI

Arkansas Bar ID #82175, be, and hereby is. REPRIMANDED and fined $1,000.00 for his conduct in this matter. The request for restitution made by the Office of Professional Conduct is denied. Any petition filed under Section 8 of the Committee's Procedures by the Office of Professional Conduct seeking paymem by Webb of the COSts of investigation and any other COStS in this case shall be heard at the July 2001 Committee meeting.

CAUTION JOHN LEE MARTIN Springdale, AR

May 25,2001 The formal charges of misconduct upon which this Order is based arose from the complaint of Fred N. Paine. John Lee Martin, an attorney practicing in Springdale, Washington County, Arkansas was the attorney for Mr. Paine in the case styled, Katrina Pajne v. Fred Paine, Washington County Chancery Coun No. E 98-439. On May 17, 2000, a Temporary Order was consemed to and entered in the above styled action. Mr. Paine received temporary custody of his child and agreed not to seek child support from Ms. Paine at that rime. A trial date was ultimately set for August 8, 2000. On August 7, 2000, Mr. Paine called Mr. Martin's office to inquire as to the status of the August 8, 2000 trial date. He was informed that the trial date was "bumped." On August 8, 2000, Dana Dean Watson, Ms. Paine's counsel sent an Agreed Order to Mr. Martin. On August 9. 2000, Mr. Paine again caJled Mr. Martin's office to inquire as to the new trial date. Mr. Paine was told that Mr. Marrin had received a proposed Agreed Order. Mr. Paine requested that the proposed Agreed Order be Faxed ro him. Mr. Paine received the faxed Agreed Order on August II, 2000. Mr. Martin consented to the Agreed Order and allowed it 10 be entered on August 10, 2000, without consulting and obtaining the agreement of Mr. Paine. The Agreed Order allowed Ms. Paine to continue not to pay child support. On August II, 2000, when Mr. Paine received his copy of the Agreed Order by fax, he called Mr. Martin's office and informed the office that he objected to the Agreed Order, especially regarding the child support issue. Subsequently, Mr. Paine terminated Mr. Martin's representation of him. A Motion to Set Aside the Order was filed by Mr. Paine's new The Motion was denied by the counsel. Washington County Chancery Court on November

28,2000. Mr. Marrin admitted that he signed and allowed the Agreed Order to be filed in this case without reviewing the Agreed Order with Mr. Paine. Mr. Martin admitted that it was his incorrect recollection of what Mr. Paine wanted that caused Mr. Martin to execute and return the Agreed Order. When Mr. Martin learned of his error, Mr. Martin contacted opposing counsel on August 14, 2000.

Mr. Marlin prepared a Motion to Set Aside the Agreed Order and was prepared to file it, when Mr. Paine te:rminated his representation. Mr. Martin wrote Mr. Paine acknowledging, the: termination, the instruction (0 do no further work for Mr. Paine and specificaJly advising Mr. Paine he had 90 days to set aside the Agreed Order. Two weeks later, Mr. Paine stated he che:cked the circuit clerk's file to note whethe:r Mr. Paine:'s Motion to Set Aside had been filed. It had not. He again wrote Mr. Paine. On August 28, 2000, the Motion had still not been filed. Mr. Marrin called Mr. Paine and informed him of the lack of a Motion in the file. Mr. Paine stated that another anorney was handling the Marion. The Motion was filed on October 6, 2000 by Mr. Paine's new counsel. Mr. Martin submitted an affidavit to the Court as to the facts of the maner. On November 28, 2000, Judge Storey denied the Motion. Following Mr. Martin's receipt of the formal complaint, the respondent attorney offered to enter into a discipline by consent pursuant to Section 8C of the Procedures of the Arkansas Supreme COUrt Regulating Professional Conduct of Arrorneys (Procedures). Upon consideration of the formal complaint, the respondent anorney's response, the terms of the proposed consent to discipline hereinafter stated, the Alternate Committee on Professional Conduct approval thereof. and the Arkansas Model Rules of Professional Conduct, the Committee on Professional Conduct finds: 1. That Mr. Marrin's conduct violated Model Rule 1.3 when he received a proposed Agreed Order on August 8, 2000 and approved the Agreed Order the same date without communicating with his dient or providing a copy to the diem until Augun II, 2000. Model Rule 1.3 requires that a lawyer act with reasonable diligence and promprness in representing a client. 2. That Mr. Martin's conduC! violated Model Rule 1.4(b) when he entered into an Agreed Order on August 8, 2000 in his dient's behalf without seeking the diem's approval, advising his dient of the contents of the Agreed Order, or providing the dient a copy of the Agreed Order until August II, 2000. Model Rule 1.4(b) requires that a lawyer explain a matter to the extent necessary to permit me client to make informed decisions regarding the representation. 3. Tim Mr. Martin's conduct violated Model Rule 8.4(d) when on August 8, 2000 he entered into an Agreed Order without his client's consem. The Agreed Order was entered on August 10,2000. On August 11, 2000, the dient learned of the Order and communicated his disapproval to Mr. Marrin. The client retained new counsel to set aside the Agreed order requiring funner proceedings of the Court in this matter. Model Rule 8.4(d) requires that a lawyer not engage in conduct that is prejudicial to the administration of justice. WHEREFORE, in accordance with the consem to discipline presented by Mr. Martin and the Executive Director, Stark Ligon, it is the decision and order of the Arkansas Supreme Coun Committee on Professional Conduct that John Lee Marrin, Arkansas

_ _'10

La\\~et'

Disciplinat'y Actions

Ba. 10 #89215. Ix, and h..eby is. CAlITlONEO for his conduct in this matter.

JIMMY RAY BAXTER Ikmon.AR

May 3. 2001 The formaJ complaint of miscondua ~ from the complaiOl of Joy Pack. Ms. Pack emplO}"<:d Jimmy Ray Baxter, an :morney practicing law primarily in Iknlon, Arkansas, for the' pulpOS(: of representing heT in ra:overy of damages from food

poisoning at a TennC':SStt rtSfauram. In Oaobcr. 1998. Ms. Pack and heT husband ~re uaveling from Knoxville. Tc:nnastt to their home: in Greers Ferry, Arkansas when they stoPIXd in

Lawrenceburg, TennC':SStt to C2t and s~nd the night. From the resraunnl (0 their hOld room, Ms. Pack b«ame ~ry ill. Ms. Pack was rakeR to me loc::;L\ hospital and was [re3.t~ and rdosed. Ms. Pack and her husband returned home to Arkansas the next day. Upon returning to Arkansas, Mr. and Mrs. Pack called the restaurant concerning the incidC'n1. As me restaurant owner did nOI return the rdephonc= caJls, the Packs sought legal assistance. As Ms. Pack had previously lived in Benton, Arkansas. and Jimmy Ray Baxter, Allorney at l:J.w, Benton, Arkansas. had handled a previous legal mailer for her, Ms. Pack contacted Mr. Baxter for legal assistance. In November 1998. Ms. Pack met with Mr. Baxter and disclissed her marter. Mr. Baxter st:ued to Ms. Pack in the (ourst of the discussion that the mailer would never go to coun. Mr. Baxter agreed to represent her in themaller.M r. Baxter mereafter sent a letter to the Tennesstt res12urant demanding that its liability insurer ~ notified about the incident. On March 12. 1999. Mr. Baxter sent Ms. Pack a later asking her to come to his office on March 23, 1999. and make a statement to John Moore. a claims adjuster with Mid South Claims. Mid Soum Oaims represented the insurance company for me Tenness« res12urant. Ms. Pack appeared at Mr. &xter's office and made her S12tement to the claims adjuster. Ms. Pack st:llro dUI she made six or scvc=n ca.lls to Mr. Baxler's office following me March 23. 1999, meeting, bur was nevt:r able ra talk to Mr. &xter. In February 2000, Ms. Pack was able to 12lk to Mr. &xter and was raid to come to his office on February 14.2000. Ikfore she left her home to go to Ikmon, Ms. Pack rt'CCivtd. a telephone ca.ll from Mr. Baxter. According to Ms. Pack. Mr. Baxter informed her that he was sorry to teU her that he did not know Tenness« had a one ~r statute of limi12rion on filing that type of case and thar the time for filing me C2se had passed. He stated mat he thought he had the same amount of time as here in Arkansas, which was more than the one year. In his response, Mr. Baxter denied that he violated Model Rule 1.1. Mr. Baxter Stated that the maner was an Arkansas case and not a Tennessee case. As a resulr, according to Mr. Baxter, the Arkansas statute of limitalion applies, nOt the one year Tennessee statute oflimit3tion. According to Mr. Baxter, there were two parties identified as jointly and severally

liable to Ms. Pack for her food poisoning injury: the restaurant and the food supplier. The food supplier is a foreign corporation registered to do business in Arkansas and, according ro Mr. &xter, Ms. Pack could bring a products liability suit in Arkansas against the food supplier. As Ms. Pack could bring suit in Arkansas, the Arkansas statute of limiration would ~ the applicable S12rute of limi12rion. Mr. Baxttt S12tro that he determined t:arly on in the matter that he would not file suit in any other forum other than Arkansas. Mr. Baxter denied that he violated Model Rule 1.3. Mr. Baxter nated that he met with Ms. Pack on ovc:m~r 17. 1998 concerning her claim. On ovembt:r 17, Mr. Baxter sem a letter ro the Tennessee restaurant placing it on notice of Ms. Pack's claim. Upon rt'CCipt of a letter from the claims adjuster in Dt:ct:mber 1998. Mr. Baxter notilled Ms. Pack 10 con12et his office. Ms. Pack conracted his office, spoke with a mem~r of&xter's staff and was informed of the request from the claims adjustor. Ms. Pack provided the requested information. Mr. Baxl'er informed Ms. Ilack of the adjustor's request for a statement from Ms. Pack and Ms. P-dck and Mr. Baxter's sraff arr:tngcd dates and times for the natemem. On the dare of the statement to the adjustOr, Mr. Baxter conferred with Ms. Pack about her claim. Mr. Baxter requested records from the nearing physician and hospital concerning Ms. Pack's treatmem and, once the information was obtained. submitted the information to the claims adjustor. Upon receipt of the claims adjustor's letter wherein he advised Mr. Baxter that the insurance carrier would not consider the claim because: of the Tennessee one year srarure of limitation, Mr. Baxter informed Ms. Pack of the claims adjustor's decision. According ro Mr. Baxter, me Tennessee stature oflimil3tion is not a bar to Ms. Pack's claim as Ms. Pack could still sue the food supplier in Arkansas. Upon consideration of me formal complaint. the response: thereto. and the Arkansas Model Rules of Professional Conduc(, the Committct: on Professional Condua finds: I. That Mr. Baxter's conduct violatM Modd Rule 1.1 when he failed to ascertain the starute of limi12tion period for filing a negligence case in Tennessee. Model Rule 1.1 requires that a laW)'l=r provide competent reprcscnt2tion to a client. including the legal knowledge and preparation necessary for the representation. 2. That Mr. Baxter's conduct violated Model Rule 1.3 when he failed to act in a timely manner to get Ms. Pack's legal matter settled or a civil aaion filed before the S12tute oflimi12tion expired. Modd Rule 1.3 requires th:H a lawyer act wirh reasonable diligence and promptness in representing a client. WH EREFORE. it is the decision and order of the Arkansas Supreme Coun Comminee on Professional Conduct that JIMMY RAY BAXTER, Arkansas Bar ID #78012, be, and hereby is, CAUTIONED for his conduct in this matter.

Continued from page 11

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30

31 32

usage (city, township, county. district, erc.). It seems imended co provide Aexibility in areas where the case law has disallowed reasoned solutions to practical problems - such as where a city is located on a county line without abrogating the provision that there be at least one court per county. It will be interesting to see how that term develops. While I have omitted any significant discussion of this section in the text, suffice it to say that, somehow, this section factors into the reasoning of [hose who hold [ha< Arnendmem 80 repealed countywide jurisdiction of municipal courts. For those who argue that Amendment 80 repealed counrywide jurisdiction. the phrase majority o/tlectors within tht district they strvt triggers a thought pattern envisioning a boundary within which all vorers (in the judge's election) live and within which a crime must occur for that judge to have jurisdiction over the perpetrator. However, I believe this section's sole significance lies in its changing the electoral quantum, from pluraliry to majority. for district court judges. Black's Law Oic<ionary (5[h ed. 1979) states that the word juriJdicrion "is a term of large and comprehensive import" and provides over a page of definitions for the word and for phrases encompassing the word. Perhaps the most accurate nuclear definition, however. is "the legal right by which judges exercise their authority." Although it may be error to do so, I avoid extensive definition of this basic term, assuming the reader to know and understand the basic distinctions among in personam, in rem, and subject maner jurisdiction. Su id. Section 10 provides mat the legislature is to establish districts and the appropriate number of judges for each, districts to be composed of "conriguous territories." This, read wirh Section 7(0) ("A Oi",ic< Judge may se",e in one or more counties") vis-a-vis jonts, Amendment 80 Continued on page 52

\'01. 36 No. ,1I1'a1l100 I

The ,Irkmas l,a~j1f

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Amendment BD Continued from page 51 supra. Note 13, and Sexson, supra. Note 13. addresses the need in cities on county lines. 33 Ark. Code Ann. § 14-56-413 (Rep!. 1998). 34 See Note 26, supra. 35 Judge Stewart graciously agteed to be quoted in this article. Quoccs artribured

Jack Davis

co him are from private correspondence in August 2001. 36 Webb, supra Note 13, 323 Ark. at 87 (Hickman, dissenting). 37 E.g., Ark. Code Ann. §§ 5-2-317 (venue for some persons committed to DHS custody "may be in" Pulaski Probate, Nimh Division"; for some who've been

Sid McCollum

Frank Hamlin

INC Museum Center, Suite 10, 500 East Markham Street Little Rock, AR lZZOI 501-376-2121 1104 South Walton Blvd., Suite 20, Bentonville, AR lZ712 501-271-2237 423 Rogers Avenue, Suite 101, Fort Smith, AR lZ902 501-783-1776 ~1

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~lIw.lrkllr.CI.

conditionally released, "shall be

111

probate coun of the county where the person currently resides); 16-60-109 (contract actions against nonresident may be in county of plaincifF's residence when claim arose); 16-60-202 (no venue change in civil actions unless necessary for impartial rrial); 23-32-1505 ("foreign invesror companies" may sue and be sued in county of residence of any party ro the suit; where land is involved, venue shall be in the county where land is locared); 28-40-102 (venue for probate and administration of will); 28-65-202 (venue for appoimmelH of guardian); 28 U.s.c. §§ 1391 (general venue statute for all civil actions in United States District Court); 1965 (venue in RJCO cases); 47 U.S.c. § 227(F)(4) (venue for states to file civil actions against unlawful telephone solicirors). This list is far from complete. Searches for venue on electronic legal research servers produce dozens of statutes that contain the word. 38 E.g., ER. Cr. P. 18: "Except as orherwise permitted by statute or by these rules, the prosecution shaH be had in a district in which the offense was committed. The court shall fix the place of trial within the district with due regard to the convenience of the defendant and the witnesses and the prompt administration of justice." A search of Arkansas court rules for venue reflects only seven that contain the word: A.R. Cr. P. 21.3 (twO or more offenses are "related" if, inter a/in, "within the jurisdiction and venue" of same court); 24.8 (when pleading to offenses committed III other jurisdictions. defendant requesting transfer of charges is deemed to waive "venue as ro an committed in another offense governmental unit of the srate"); AR. Inf. Ct. 2 ("These rules shall nor be construed to extend or affect the jurisdiction of the inferior courts ... or the venue of actions therein"); A.R. Civ. I~ 8, 12, & 82; and Procedures of the Ct. Reg. Prof. Conducr §5 (venue for atrorney disbarment proceedings).

Amendment BD Continued on page 53

Amendmenl 80 Continued from page 52

39 Ark. Consr., Amend. 80, §7(A). 40 Ark. Const., Amend. 64; Ark. Code Ann. 16-17-704 (1999 Supp.). 41 Ark. COlm., Amend. 80, §7(B). 42 The process for the Supreme Coun's promulgation of a rule is, as best I can rcll, not reduced to a formulaic process. Thus, any suggestion I might make

regarding how to employ it would be speculative. There are comminces in place as w most sers of rules, and membership of those commirrees is a matter of public record. 43 See State v. Lester, 343 Ark. 662, 38 S.W3d 318 (2001); Clirtis v. State, 301

Ark. 208, 783 S.W2d 47 (1990). 44 Ark. Const., Amend. 80, §7(B). 45 See McGrew II. State, 338 Ark. 30, 991 S.W2d 588 (1999); McArthur v. Pulaski County Circliit COllrt, 253 Ark. 501,504 488 S. W2d 5 (J 972). 46 See State v. Roberts, 321 Ark. 31, 900 S.W 2d 175 (J 995).

SItlNIICMI IIIcIsIons Continued from page 40

warranto find the OriginaLjurisdiction ofthe Supreme Court ofArkansas, 20 UALR L. j. 89/ (1998). 1 See Stare ex reI. Brooks v. Baxter, 28

Ark. 129 (1873). 2 The opinion does nor appear in the official Arkansas Reports. It can be found in Arkansas Supreme Court

Opinion Book C, No.2, ar 355. 3 14 u.s. Op. Arry. Gen. 391,400 (May 14,1874). 4 See Baxrer v. Brooks, 29 Ark. 173, 187 (1874).

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Kenneth M. Parsley Kennerh

M.

Parsley,

87,

Former

Dardanelle City Anorney, died Monday, May 14 ar Dardanelle. He was a 1945 gradu3re of the University of Arkansas Law School and a 50 year member of rhe Arkansas Bar Association.

He had been a

member of me Dardanelle Chamber of Commerce, Rotary, Arkansas Oil and Gas Commission, and rhe American Legion. He was a avy veteran of World War II and

a lay leader, aclminisrcarive board member and adult Sunday School reacher at First United Methodist Church. He is survived

by his wife, Anna Love Harmon Parsley, a daughrer, and omer F.unily and friends. Charles L. Gocio Charles L. Gocio, 78, passed away on Monday, June 18. A former Benron County Prosecuting Acromey for ten years, Me. Gocio graduated from the University of

Arkansas School of Law in 1949 and practiced law in Bemonville for 50 years. He was a member of the Bemon Coumy Bar Association, Arkansas Bar Association and American Bar Association, Bentonville Chamber of Commerce, the Kiwanis Club,

He earned a law degree from Washingron & Lee in 1935 and joined the Fordyce law practice founded by his grandfather, Thomas Bortemly Morron and owned by his uncle, Fred Morron. He was a continuous member of the Arkansas Bar Association for 33 years. During that time, he served on at least ten commirrees and in

the House of Delegares.

He was a 1995

Sustaining Member of the Association. Mr. Sparks served six two-year terms in rhe Arkansas House of Representatives, commencing in 1966. He was also acrive in national politics. He served on the Board of Directors of the Fordyce Bank and Trusr Company, as a Trustee of the Hendrix College Alumni Association and a member of the Fordyce Chamber of Commerce. He was a past president of the Fordyce Rotary

rep hen Edgar Kirk, 46, of Morrilron died Augusr 22.

He was a past Prosecuting

Atcorney in the 15th Judicial District of Arkansas. Mt. Kirk was edico( of the Arkansas Traveler at the Universiry of

Arkansas in 1977, and a member of Phi Kappa Alpha. A member of Firsr Baprisr Church, he is survived by his wife, Suellen Petrus Kirk; (\110 daughters; his mother; brother; and many ocher relarives and

friends.

Club and a Paul Harris Fellow. A lifetime member of the Methodist

Church in Fordyce, he raughr Sunday School and exercised his considerable musical talent by singing with the church

choir. Mr. Sparks also played saxophone, clarine< and sang wim college bands and performed at resorts during summer breaks. He served as a communications specialist

Cecil Randolph Warner, Jr. Cecil Randolph Warner, Jr. passed away on August 29 at age 72. He was a magna cum laude graduate of the University of

Masonic Lodge #56 and me Shrine cimirar Temple. He sat on rhe Bates Medical

during World War II.

Arkansas (1950) and Harvard Law School (1953). He was an edimr of the Harvard

Cemer Board of Directors for 26 years. According to newspaper repons, Mr.

Wdton E. Steed Wilron E. Sreed, 78, died June 8 in Pine

Law Review. He was a partner with his father and uncle in the Warner and Warner Law Firm (now Warner, Smith & Harris)

Gocio served in rhe U.. Army ignal Corps

Bluff. He was a graduate of the University

founded in FOr[ Smirh in 1887. The real

and was a communications officer during

of Arkansas School of Law in 1951 and

estate and trial lawyer was a past chair of the executive committee and general chair of the

World War II. One of his grandmomers,

practiced law for 50 years.

Marie Messa.ger, was a pauiot during the American Revolution and is honored with a plaque at Arkansas Post. During the Civil War, Gocio's family lived at the Massey Hotel in Bentonville, which featured

City Anorney from 1954 to 1958 and Municipal Judge from 1958 unri11970. He

prominencly in me Barrie of Pea Ridge and

Associations. Mr. Steed was a hriner and member of

is now the headquarters for the Walton Foundation. Mr. Gocio's wife, Berrye Currier Gocio, described him as a man who loved the law, and an avid sportsman who

enjoyed

fishing,

hunring

and being outdoors. He is also survived by a daughter,

son, gra.ndchildren, step-grandchildren and step-grea t-grandch ild re n.

Mr. Steed was

was a former presidem of the Arkansas

Municipal Judges Council and a member of me Arkansas and me Jefferson County Bar

rhe Masonic Lodge, the American Legion, and the VFW He was an Army veteran of

World War II. He had a lifelong inreresr in spom playing baseball and football while attending Wake Forest University. Later in

life, Mr. Sreed played rennis and enjoyed hunting and fishing.

He was the organizer

and first president of me Pine Bluff Tennis Thomas E. Sparks Thomas E. Sparks passed away on June 29 at the age of 89. Born in Crossett, Mr. Sparks was a long time legal, civic, business and church leader in Southeast Arkansas.

Pacrons Association. Mr. Steed is survived by his wife, Sunny Hogan Steed; a son, a daughter, a sister and

rwo grandchildren.

Young Lawyers Section of me Arkansas Bar Association. He was also a member of the Pulaski County and American Bar Associations and a former instructor at the

University of Arkansas School of Law. He was

vice

chair

of

the

Arkansas

Consrirurional Review Commirree (J 967) and vice president of the Seventh Arkansas Consrirurional Convenrion (J 969-70).

Mr.

Warner

co-founded

Fairfield

Communities, Inc. in 1966 and was its President and Chief Executive Officer

(CEO) from 1976 unril 1991. He was CEO of Ensco from 1991 unril 1993 and of the Worn Company in Poreau, Oklahoma from 1993 unril 1997. He was a member of Fifty for me Future and me boards of directors of First Commercial Bank, St. Vincent Infirmary Foundation and Centers for Youth and Families. He also sar on me

Sparks Regional Medical Cemer Board of Trustees. Mr. Warner was elder and trustee of First

Presbyterian Church in Fort Smith,

a

member of SLJames United Methodist Church and associate member of the Palm Ciry, Florida Presbyrerian Church. He is

survived by his wife of 18 years, Barbara; five children; three stepchildren; a siner and orhcr relatives and friends.

Th~ Arknmas

Bar Foundation Ilcknowkdgn with graufulllppruiation rlu "uipr ofmnnorilll

gifts and rcbolarship contributions giv," in memory oftbe following individuals from June /6. 200/ tbrougb S.ptember / /,200/: IN

MEMORY OF

ARTHUR BENNETT

Mr. & Mrs. Fred Brown, Jr. Fred K. Darragh, Jr. Mr. & Mrs. Joseph A. Lipe Wanda McConnell c.F. & Karhryn Plunkett Yvonne Ward Patricia Townsend Leon & Roxanne Caderr Ginger Hoi, Mrs. Hoy Plunkett Luppen David & Karen Samuel Hilda Thomas Barbara & John Breen L. Cotton Thomas & Company John, Kathy, Matt & Kelly Ransom

Judge William R. Wilson, Jr. I

MEMORY OF CA11iERINE HICKEY

Judge William R. Wilson, Jr. IN MEMORY OF JOHNNIE HOLCOMB

Jack M. Wilhelm IN MEMORY OF MRS. FRANCES MENDELSON

Mrs. Helen Eichenbaum IN MEMORY OF LEONARD

The members

S=rr

Richard Hatfield

Margaret Harchen IN MEMORY OF JAMES

of the Arkansas Bar Association humbly recognize the thousands of people

B.

SHARP

Bill & Kay Allen Richard Hatfield Frank Morledge Perroni Law Firm Jim & Bonnie Shaver Judge William R. Wilson, Jr. and CathiCompron IN MÂŁMORY OF TOM SPARKS

W. Chriscopher Barrier IN MEMORY OF

MARy HOLT TRUEMPER,

DESIGNATED TO THE JUSTICE J. FRANK

AI & Eli7..beth R. Robertson & Family Diane Sycloriak David & Lynn Coates Dr. & Mrs. Ernest Holt Edwina Iacovelli Judith Boaz La Donna Cleveland Mary A. Brown Deede Phelps Patricia Shifflett Margaret, Jane & Jack Holt Berry & Steve Marthews Ray & Jan Swetenburg Karhy & Perry Johnston

HOLT SCHOLARSHIP FUND

who lost their lives in attacks on the World Trade Center and the Pentagon on September 11, 2001.

LuciJe Barnen Carrie & Tyndall Dickinson Mr. & Mrs. Edward Erxleben Annie & Justice John Fogleman Barbara & Pete Hoover George W Kirtley Mrs. John E. Miller, Jr. Mrs. Ben A. Rand Billie & Skip Rutherford Walls & MargatCr Trimble Barbara Walker-Hare Robert M. Wilson Pamela C. Wood Mr. & Mrs. William J. Jernigan, Jr. Mr. & Mrs. Michael Kaufman Virginia D. Mitchell RameYI Krug, FaeeH & Lensing Judy & Randy Wilbourn Mary Ruth Brown

IN MEMORY OF

C.

RANDOLPH WARNER,

JR.'

ancy Bailey Mr. & Mrs. Winslow Drummond Jusrice John A. Fogleman The Arkansas Bar Foundation adminincrs two endowed scholarships entitled the C. R. Warner Scholarship and the H.P. Scholarship should donors wish ro

designate [heir memorials for M f. \Varner to one of these scholarship funds.

III. nNI. I/FaIl iDOl

ne tlr~lIl1l LIWW

Ii

ns SICUII -..n

PUBLIC NOTICE

Cominucd From Page 21 Warch for other news, events, and opporrunities for Young Lnwy~rs in the Young Lawym &etion Nnusl"ur. edited by Michelle Cauley. If you have news of interest co your fellow Young LaWY~rJ. contact Michelle about space in the next edition. Also, watch your e-mail for the opporruniry (0 be involved in a }'oung Lowyar liscscrve through the Bar Assoc3rjon's expanded and revised web page. Soon we will have [he ability ro contact aJl Young Lnywas bye-mail with important news and announcements. "A lawyer is a representative of clients, an officer of the legal system and a public citiun having spuia/ r~spomibilitiNfor tlu qualilY ofjustice."3 While mOSt any young lawyer can comply with [he first two requirements. members of [he Young LawJ(TS Stction are active everyday in fulfilling (he third. Come join us.• I Arkansas Bar Association Young Lawyers Section Bylaws at Article I, Section 2. 2 Id. at Article 11, Section 1. 3 Model Rules of Professional Conduct Preamble.

www.arkbar.com Legal Info Unks • Arkansas Veterans Handbook • Disaster Legal Assistance • High School Mock Trial Program • Senior Citizens Handbook/CareGivers

me

The currem (erm of office of United States Magistrate Judge John F. Forster, Jt., is due ro expire on March 13. 2002. The United States Disrrict ourr is required by law ro establish a panel of cl[Izens co consider the reappointment of rhe magistrate judge (0 a new eight-year term.

The duties of the magistrate judge position include the following: (I) conduce of Illost preliminary proceedings in criminal cases; (2) trial and disposition of misdemeanor cases; (3) conduct of various pretrial marrers and evidemiary proceedings on delegation from rhe judges of the disrricr coun; and (4) trial and disposition of civil cases upon consem of the litigams. Comments from members of the Bar and the public are invited as to whether rhe incumbent magistrate judge should be recommended by the panel for reappointmenr by the Court and should be direoed to: Magistrate Advisory ommirree, do United States District Court Clerk's Office, 600 West Capitol Avenue, Suite 328. Little Rock. AR 72201-3325 Comments must be received no later than October 12. 200 I.

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The Arkansas Lawyer magazine Fall 2001