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Inside: The Arkansas Ho,mestejilt, Exemption Under th4;JRen . .~ Bankruptcy Cede: A Crack in the Foundatiol\

The Life and Death of a Reverse Mortgage

The Uncertain Gift: Arkansas' New Beneficiary Deed


cases & Codes

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PUBUSHER AnfHlfs"u Bur Amxiilritl" Phone: (501) 375-4606 Fax: (501) 375-4901 Hornepage: www.arkbar.com E·M~i l : ahubba rd @;.rkba r.com

The Arkansas

awer

GRAPHIC DESIGN SoN umdif

WITORIAL BOARD Philip E. K2plan, C hair Judge Wiley A. Bra nton. J r. Leigh M. C h iles M ilton Fine, It Judge J. Leo n Holmes Mary Beth Matthews Swart P: Miller Gordon

5.

Rather, Jr.

C hristopher T rav is David H . W illiams

Vol. 41. No. 2

features

TeT'e$a M. Windand

OFFICERS President

A. G lenn Va.ucr Bo:ud of Governors Chair

Nate Coulter' President-E1cct James D. Sp-ott

11 The Arkansas Homestead Exemption Under the Revised Bankruptcy Code: A Crack in the Foundation? Harry A. Light and Donald M. Warren

Immedia te Pasl President

F.re<i S. Ursery Sccrc:rary-Trcasurc:r Will.ia.m A. Martin IlarJiamen nlrian

Thoma. M . Carpenter Young l.:iwye rs Seclion Chai r

16

Patrick D. W d.oo

The life and Death of a Reverse Mortgage

Executive Director DoD H ollingsworth

Angela Martin

Associate Exccutive D ircctor Judith G ray

BOARD OF GOVERNORS J im Burnett Niki Cung Thomas Curry Jc:r.nnen e Denham Charles L. H arwell William O. James. Jr.

Jim Julian Philip Kaplan Sean Kc:ith Harry A. Light C halk Mitchdl RO£;j,lind Mou~r John R. Pttl Don na PettUS Riehard L Rams;.JY James M. Simpson, Jr. Ci nay Thyc r John T. Vi ne! &ldic: H. Walker. Jr. Katharine C. Wilson Tonl D. Womack

UAlSON MEMBERS Barry Deacon wnw D. Shepherd Don Hollingsworth

Jack MeNu]!)' Carolyn B. Witherspoon E. Porter, Jr.

Judge Kim M. Smith

Jesse:

71MA~~ (US PS 546-(40) is publil~ qw.nnly by the Arhnsu 1m Association. ~riociiaIs paid at Link Rock.. Athnw.. POSTMASTER.: srnd addres ~ 10 TJ" ~

pOlS,.

~, "00 West Mukhlm. Lil1lr Rock. Arlu.nw; 72201. SulMocnption pri« to non ·mrmbm or mr A,lu.r»as Bar Associ,uion $3S.00 JX'r yc<l'. Any opinion c,p~ hr ...;n ;$ th.t o( thr ~ulho,. and not nca:ssarily th~t of tM Arkaru:u BA' Auoci:ttion ot nr ~ ~ Contributionl to nrAI"IIrm.r.M~ ..., wd· C'Ol"Ilr And

should be 5c'nt

10 ah~.rom. nr~

20 The Uncertain Gift: Arkansas' New Beneficiary Deed Christopher Barrier

26 Arkansas Lawyer Diversity Outreach Registery: A Joint Venture of the W. Harold Flowers Law Society and the Arkansas Bar Commission on Diversity Colette D. Honorable and Peter G. Kumpe

28 Practice Tips (or Reminders) for Drafting the Divorce Decree Willia m G. Almand

30 Arkansas Supreme Court Historical Society Noteworthy Arkansas Jurists: Justice George Rose Smith Patsy Ba ilin

~,

400 West MarkNm. Li11k R.oclt. Arlu.nID 7220\. All InqUIries Kpldmg adwnumg It-.Id be $rf1t to Editor. nr ~ L-tpr: at the, aIJo...c. addlnl. Copyright 2006. AOOnus &lr AS$OCi~tion. All righu ft'SCfYt'd.

Contents Continued on Page 2


The Arkansas

awer Vol. 41. No. 2

in this issue Meet t he Arkansas Bar Association Staff

4

CLE Ca len dar

31

2005-06 Arkansas Bar Association Sustaining Members

32

Judicial Advisory Opinions

36

Lawyer Community Legacy Awa rds

37

Lawyer Discipli nary Actions

38

In Memoriam

48

Arkansas Bar Foundation Memoria ls an d Hono raria

51

Classified Advertising

52

columns President's Report A. Glenn Vasser

5

Young Lawyers Sect ion Report Patrick D. Wilson

9

c:::::> 1111 Arkansas Bar Association 400 W. Markham Little Rock, Arlwuas 72201

HOUSE OF DELEGATES Delegate District I-S£: Roben E Thompson, III Delegate District 2-5£: Katharine C. Wilson Delegate District 3-5£: Dennis Zolper, Robert S. Jones, Barbara A. Halsey Delegate District 4-5£: Kathie A. Kimbrell De legate District S-SE: Ken! J. Rubens Delegate District 6-5£: Marshall Wright De legate District 7-5£: Buck Gibson Delegate District 8-SE: Tim A. Blair Delegate District 9-5£: Jim Pal Flowers Delegate District 10-SE: Catherine Lewis, Anthony A.Hilliard Delegate District I I-S£: Phillip C. Glttn Delegate District 12-5E: Jam ~ A. Hamilton Delegate District 13-S£: Matth(:w Shepherd, James McMenis Delegate District IS -SE: Bryan 1'. McKinney, Todd M. Turner

Delegate District 14-SE: Matthew Kimmel, Amy Fr(:(:dman De legate District 16-SE: John 1'. Vines, Jonathan D. Jones

Delegate District 17 -SE: James Ralph Jackson Delegate District I-NW: H(:alh(:r Lipk(:, Lisa L Kelley, Hardy C roXlon, Jason B. Kelley Delegate District 2-NW: Brock Showalter, Buddy Chadick, Matthew R. Durrett, C hris R. Reed. David J. Whitaker, Cha rles Harwell , Raymond Niblock, lim Tarvin, Jason B. Duffy, Elizabe[h Duffy Delegate District l -NW: Roben R. Briggs, Stephen Smi th. James O. Cox, Shannon Blan , limothy Sharu m, Amy Click-Horoda Delegate District 4-NW: Pauick McDaniel De legate District S-NW: Steve B. Davis Delegate District 6-NW: Roy Iklh Kelley, John C. Riedel Delegate District 7-NW: Larry Spradlin . Danny M. Rasmussen Delegate District 8-NW: J(:rry Patterson Delegate District I-e: Causley Edwards, David W. Sterling, Brenda N. Stallings, Mark H. Allison, Patrick O. Wi lson, Valerie Kelly, G regory L. C row, Lacy Kennedy, Colene D. Honorable, C. Tad Bohannon, Jerry Larkowski, Brian Vandiver. Jeffrey Weber, Mark McCarry, Randall S. Buerer, Jay Taylor, Beth Deere, Leon Johnson, Marcella Taylor, Rcba:ca Denison. Stephen Bingham , Michelle Cauley, David Fuqua, David Glover, Jay Shue, Elizabeth Smith, Brad L. Hendricks, Joel M. DiPippa, Rhonda K. Wood, Gill A. Rogers

Law Student Representatives: Stephanie DcClerk, Universiry of Arkansas School of L1.w; Erin Brogdon, UALR Wil liam H. Bowen School of Law

2 n,e Arbnsas la\.\yer w..vw.arkbar.com


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Please visit Jeffrey Adams at the ABA Retirement Funds Booth at the upcoming Arkansas Bar Association Annual Meeting for a free cost comparison and plan evaluation . June 7·10, 2006 • Arlington Hotel· Hot Springs, AR

JB\ " or II ("01" or .h(' P rn,. ,...... "'~ .. ith 11000- .... ' mllk' .. inr"nnatmu ",<"I,,,li" l= cholJlt'. au,l f~I""h(,' 11''''-''-1;11 .. <1 "'Ih l lH' """d_. "r In ~1",aL hI n "",uI, ",ltL~lI hn l1l , <'nil (877 ) (l i :;·:.!:.!7:.!. or "'If "'-" "'·.nhll .... " n'm"I11 .• '{>!ll or "nit' \11 \ 1I""ll'lIlrtll hll"l. P.O, Ho.~ [. lit • 1:1.,, 10 01 'I \ Ol~Ot, .:; Ii:! • flll!ln'" ...."wm@nll·'lft"<llllill(' _rOIU &- ~u .... 10 n'",1 Ih .. P"'-"J~'''I '" (,.III'f' r" lI~

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MEET THE ARKANSAS BAR AsSOCIATION STAFF

Scated I ( 0

r:

Joyce Bobbitt Barbara Tarkington, Judith Gray, Michele Glasgow. Sranding I ( 0 r: Ann Dixon Pyle. Virginia Hardgrave, Don Hollingsworth. Rando Hicks, Diane Gerrald, Kart:n Hurchins, Anna Hubbard

Over 165 Years of Co mbin ed Experience Joyce Bobbit< (1984 ) Bookeeper Barbara Ta rkington (1966) Membersh ip DirectOr Judith Gray (1967) Associate Executive DirectOr Mi chele G lasgow (2000) Executive Secretary An n Dixon Pyle (1995) Executive Director Arkansas Bar Fou nd ation Virgini a Hardgrave (1981) CLE Secretary Don H oll ingsworth ( 1996) Executive Direcro r Rando Hi cks (2000) Administrative Assis rant/Webm3srer Diane Gerrald ( 1995) Recepti onist/Secretary Karen Hu tchins (2005) C LE DirectOr Anna Hubbard (2005) EditOr/Publications Directo r

me

Associate Executive Director Judith Gray rerires fro m Arkansas Bar Associatio n this July after almost 40 years of exemplary, dedica ted . and caring service. Her loralry and love for the legal profess ion has helped make (his Assoc iatio n what it is today. No one individual has impacted the Association more. Her presence will be missed by all , but rhe many friendsh ips will remain strong. I~ S. Both Judith and

The Arkansas UtuJytr turned 39 [his year in Assoc iation yea rs.

4 The Arkansas lawyer

www.arkbar.com


PI-es ldent's Report

by A Glellil VassPI

Who Is Your Hero? "A group becomes a team when each member is sure enough of himself and his contribution to praise the skills of

others," - Norman G. Shidle

When I was ho nored last Ju ne to be installed as Pres idem of our Association, I accepted this importanr lead ership position with the emph asis th at I was a humble, proud and grateful co un try lawyer from

Prescorr. Humble in rhe sense, that I was certainly most undeserving. as I have stood on the shoulders of giancs all of my personal and profess ion al life. Proud in (he sense, that I am extremely privileged to be a member of this great profess ion and Association. And I am grarcfuJ to so many folks who have sacri fi ced their tim e and talents before and du rin g chis year to make this wonderful honor poss ible. As I embarked on this year, I compared the Pres idenc's Gavel to the baton received by a runner in an endless relay. As I near rh e co mpletion of m y leg of this race, I have com e to appreciate how true the sayi ng is that "the journey is greater than the inn," Permit me [0 relate so m e observatio ns about this journ ey which I feel co mpelled to share with yo u. One of my thoughts is addressed by Fran k Sanitate in his book-" Don'r Go to Work Un less Its Fun ." Sanirarc is o nc of o ur featured speakers at our Annual Meetin g, and I know yo u will enj oy hi s ad vice on time manageme nt and elimi nating st ress from your work. Sanitate rem inds us that co rporations are nor reaJl y "an o rganiza tio n. " The "Arkansas Bar Association" is just a shorthand way of desc ribin g a group of lawyers who have assembled together to acco mpl ish a co mmon pu rpose and goal. Sanitate emphasizes that the key to excellence in such an organiza tion is the comm itment to excellence by each member. The sta rrin g point for

achievement of excellence in such an organization is the co mmitm ent by each indi vidual to his or her own sa tisfactio n. Most people bel ieve that satisfacti o n comes from bei ng able to feel that you make a difference. Sanitate states that making a difference depends o n three essential conditions: first. yo u must feel as if you are comributing to your team. th e team must produce results and finall y the res ults must make a difference. From my perspective. o ur "group of lawyers" known as th e Arkansas Ba r Association is an excellent team co nsisting of five members. One m ember is our excellent staff; the second member is our outsta nding group of leaders; and a third member of this team is our supportive membership_ All three of these groups help the Association make a difference. A pho rograph of our d edicated staff with th eir names and years of service appears o n the page opposite this article. I urge yo u to take time from your busy schedules to thank each of them for the outstandin g job they do on behaJf of our Association. Each perso n on our staff is essential in helping our terun accomplish its missio n to make a difference ro our members and society as a whole. The second member of o ur tea m is o ur outsta nding group of leaders selected by our members. This group consists of the C hairman of ou r Board of Governors. Nate Co ulter. whose insight is invaluabl e to th e Pres id ent; the An nual Meering C hair. jim juli an. who with the staff's help has anoth er great mee ting o n tap; the Board of Gove rn ors and House of Delegates who give of their rime. tal ents and mon ey to make imporrant decisions and provide gu idance to the leadersh ip of the Associatio n; the chai rs and members of the many co mmittees, sections and task forces of the Associatio n who work o n special projects; and finally the Pres ident-Elect.

jim Sp ro tt. and President-Elect Des ignee. Rick Ramsay. who serve to ass ist th e Pres ident ro generate ideas and insure th e Association is headin g in the p rope r direction to acco mpli sh irs mission. As President, I want to thank the entire staff, and all of th ese leaders for their outstanding work thi s past year. The most important po int to remem ber about the third member of our team-the membership of our Associatio n-is that it is also voluntary. Many of us do not real ize that most states have mandatory Bars. thus membership recruitm ent is nor a goaJ, res po nsibili ty or co ncern of those associa[J o ns. Robert Putnam in hi s best sel lin g book " Bowling AJo ne" indi cated "during the last rhird of the 20th century formaJ m embership in organizations in general has edged downward by perhaps 10-20 percent. Most important, acrive involvement in clubs and other voluntary associatio ns has co ll apsed at an asto ni shing ta re ..... Society is shifting away from support through organ iza tio ns to a mo re individual ap proach. W ith this backdrop. it is significanr that our vo luntary Association co ntinu es to thrive and increase membershi p each yea r. We are on a reco rd serring pace to exceed 4.900 members this year. Such a d evelo pment is in large part attributa ble to o ur d edi ca red sta ff and rhe Membership D evelop ment Comm ittee ca pably chaired this yea r by Jeffrey Ell is. lr is also a rribute to Arkansas lawyers, who recogni ze [he im portance o f a st ro ng united Bar Associario n as a powerful force fo r o ur profess io n. T h rough the donation of th eir time, tal ents and money. our members demo nstrate their dedication and co mmitment to the co ntinual improve ment of our great and

See Preside nt's column. continued on pa ge 47

Vol. 41 No_21Spring 2006

n,e Arkansas Lawyer

5


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YOllllq LrlwYPI" C,('elIOIl Repol t

by Pdt""

W,ISO'l

,

Someone in your office should be designated to circulate the weekly case summaries to all attorneys We al l know the importance of keeping up with current Ark.1ns.1S law. This can be a daunting task consideri ng the number of cases decided each year. Your Association now provides weekly summari es of the significam Arkansas Supreme Court and Arkansas Court of Appeals cases on its Web site: www.arkbru:&2m. The Web site is updated every Monday with decisions from the previous week. This is a great reso urce and rime-saver that can be even more beneficial if you des ignate someone in your office ro print a hard copy of the sll mmary each week and ci rculate in the office. o r send an email arou nd with the sum mary as an attachment. You can quickly scm the summaries [Q see what areas of practice have been affected and whether any of the

cases sllmmarized will impact any of your pendi ng cases. Another great time-saving resource is the onl ine member direccory. Most of us scramble to keep our Rolodexâ&#x201E;˘, address book, or personal digital assistant (PDA) updated with important contacr informarion . Your Association takes some of this burden off of you by providing current contact informacion for your fellow Associarion members through the on li ne member direcrory. The info rmation is updated almost daily and contains currem phone and fax numbers, office addresses, and e-mail addresses with a live link mat rakes you srraighr to members' e-mail O ne of the best parts abom being active in the YLS is the chance to inceract with some of

the best lawyers in the stare; however, it can be difficult to remember the names of everyone that you meet at an Associarion meering or CLE program. If you can remember what city the atto rn ey was from, you can look up al l of the members from that city in me online member directory. You can also perform searches in the dirocmry by lasr name, county, or state. Borh of these online benefilS are password protected for Association members only and are accessible from the home page of the Association's Web site: www.arkbar.com. I encourage YOll co make good use of mese twO exceUenc member benefits. I have incl uded below a recent summary. â&#x20AC;˘

SIGNIFICANT DECISIONS IN THE ARKANSAS SUPREME COURT MARCH 16, 2006 CIVIL PROCEDURE VAN BUREN SCHOOL DISTRICT V. JONES, No. 05-86 1 (3- 16-06) The triaJ court's class action certification of more than 400 reachers was affirmed, where the Supreme Co urt agreed that the req uirearguments that it would be difficult to determine class membership. Plaintiff's motion ments of Ark. R. iv. 23 we re satisfied, rejecting alleged that the reachers in his couney had "'uncompensated non-instructional dueies" each day, with "pass ing periods", shortened lunch breaks, afternoon fucuJry meetings and other unpaid obligations. The school district argued mar it would be difficult ro determine the class, adding that a reacher workday was undefined to length. In focusing on the first argumenr, the circuit court and appeals cOUCt ruled mat me number of cerrified reachers who performed duries wimour compensatio n was determ inable. It will not be necessary ro look inro me merits of the claims to determ ine class members, so me trial court did not abuse its discretion in certifying this class. Each plaintiff's damages was estimated ro average $500 yearly, and the Supreme Court nored that absent class action rums, it might be difficuJr ro justify litigation. Each of me required elements in Ark. R. C iv. P. 23 were discussed and found ro have been satisfied. As to common issues of law and b.cr, the opinion nored that there is no requiremem for idemica.1 issues, as long as there is something in common for me class, and here mat issue \vas met. It \vas noted that after litigation arose, the district paid reachers fo r un compensated lunch periods in some of its schools, showing that it is feasible ro determine the hours al leged ro be unpaid.

me

Vol. 4t No. lISpring 2006

n,e Arkansas la"Yct

9


The Arkansas Homestead Exemption Under the Revised Bankruptcy Code: A Crack in the Fou ndation? by Harry A. Light and Donald M. Warren

In 1998. Wo rid Com's fo under. and former C hairman. John Po rter, purd lased a 10,000 square-foot ocean-fro nt estate in Palm Beach, Florida. The hom e, featured o n the cover of the November 2004 issue of Lu.xury Homts Magazint, was valued at nearly $ 17 million. Yet, Po rter owed mo re than $25 million for back taxes, and , at the time, he was the defendanr in several multi-millio n dollar securities fraud laws uits resulting fro m Wo rldCom's failure. To avoid these liabilicies. Po rter fil ed bankruptcy in May 2004 and sheltered his lavish estate from creditors by invoking th e Florida homestead exemptio n. I Abuse of th e ho mestead exe mption is not un commo n. Several years ago, a General Accounting Office study estimated that each year, 400 ho meowners in Flo rida and Texas. all with ove r $ 100,000 in home equi ty. profited fro m unlimited ho mestead exemptio ns. W hile living in luxury, these ho meowners wrote off an es timated $ 120 milli on owed to ho nest credi tOrs. 2 Such abuse of stare homestead exemptio ns was one of the targets of the Bankruptcy Abuse Preventio n and Consumer Protection Act (" BAPC PA" ) signed in to law by President Bush on April 20. 2005. While th e ho mestead changes in BAPC PA were primarily directed to abuses in Flo rida and Texas, the changes will signifi canrly impact th e Arkansas ho mes tead exe mption. Arkansas deb ro rs can stiLi elect to claim Arkansas' ho mestead exe mptio n; but, under BAPC PA, that election is now subject to three impo rtant fcderal 3 lim itatio ns fo r debto rs fi ling ban kru ptcy o n or afte r April 20, 2005. 4 First, a claimed homestead exemptio n ca n be reduced to the ex tent that the val ue of the ho mestead is attributable to no n-exempt property that th e debror disposed of within 10 years of filing with the intent to hinder. del ay. o r defraud a crcdi tor.5 Secondl y. a debto r may nor exempt any amo unt of interest in the pro perty exceeding $ 125 .000 chat was acquired during rhe 1.2 15-day peri od l3 1/3 yea rs] preceding a bankruptcy fi ling wi rh the exce ption of any interest transfe rred from a debtor's pri or residence acq ui red in the sa me stare mo re th an 1,2 15 days before fi ling. 6 Finally, dl e

homestead is ca pped at a maximum of $ 125,000 where the debto r owes debts ari sing fro m certai n wrongful acts.1 To understand the impact of these changes. this article will examine the traditio nal applica tio n of the Arkansas ho mestead exemption and po tential di ffering res ul ts und er BAPC PA. THE ARKANSAS HOMESTEAD ExEMPTION

The Arkansas homesread exempti on has historically prov ided debtors with th e opporrullity [Q rerain their homestead withom liability to most credi tO rs. Co nstitu tionally based, the ho mestead exe mptio n was crea ted in 1868 to "protect famili es from dependence and want, "8 and provides: The homestead of any res idenr of this Stare, wh o is marri ed o r [he head of a family, shall not be subject to the li en of any judgment o r decree of any court, o r to sale under executio n, o r other process mereo n, except such as may be rendered for the purchase mo ney. or for specific liens, labo rers' o r mechani cs' li ens fo r improving rhe sa me, or fo r taxes, o r aga inst executO rs, administrato rs, guardi ans, receive rs, attorneys fo r moneys collected by them, and other trustees of an ex press trusts, fo r mo neys due fro m them in their fid uciary capacity.9

Harry A. Ligbt is a porhler wit" Friday, EUredge 6- Clark. His practice focllses 011 creditor's rights and bankruptcy.

Donald warren is a tbird-year law studellt at fbe University ofArkansas in Fayetteville and tbe mallaging editor of tbe A,.kansas Law Review. Vol . 41 No. 21Spring 2006

n,eArkansas Lal'Ycr

II


Thus, a debror, in d.ire finand al straits, can seek refuge fro m attacking credi to rs behind the seemingly impenetrable walls of his ho me. Utilizing the exemption, married debrors facing insolvency rypicalIy liqu idate all of meir no n-exempt assets such as stOcks and bo nds , co mmercial real es tate, small business emerprises, etc. and place the proceeds either in an existin g homestead o r purchase a new ho mestead immediately prio r to filing bankruptcy.1O Under th e Arkansas Co nstituti on, such debtors are able to claim rhe exemptjo n, provided th ey are married Arkansas residents and so lo ng as their ho me sits o n no mo re than one-quarter of an acre in the ciry o r 80 acres in rural areas. I I Alth ough there is some di screpancy in the constitutio nal provisions as to th e value of th e homestead, courtS, recognizing that ho mes tead exemptio ns under th e Arkansas Constitution are to be liberally co nstrued in favor of th e exempti o n, have un iformly fo und that there is no mo netary ceil ing o n the value of the homes tead. 12 As a res ult, homesteads exceedin g one million dollars in value are not uncommon, and '\vealthy married debtors with substamial equ iry in their homes may refuse to pay their credi to rs while shel tering their weal th in the homestead. "13 This traditional protecti on, howeve r, is now subj ect ro th e new limitati o ns of BAPC PA. INTENT TO DEFRAUD

While the abiliry to attack pre-petitio n tra nsfers is not new to the Bankruptcy Code, I4 under BAPC PA, an Arkansas debtor's ho mestead exe mptio n may now be reduced to the extent of the value of any non-exempt properry di sposed of by the debtOr within 10 years of filin g a petition of bankruptcy with th e inrent to hinder, delay, or defraud a credi tor. I) As a result, this 10-year reach-back period creates fe rtile ground fo r th e growth of ho mes tead exemptio n li tiga tion and debror-credjtor ano rn eys should have a workin g knowledge of what consti tutes an intent to defraud . Merely conve rting no n-exe mpt assets into exemp t assets, eve n o n the eve of bankruptcy, does nOt create the requi site intent to hinder, delay o r defraud a credi ro r. 16 T here must be indicia of fraud bt:yulIJ the mere use of [he exemption. 17 Unfo rtunately, there is no clear-cur answer as to when the line has been crossed, since the Eighth C ircuit has refrained from "settin g fo rth either what fra udulenr intent is, as compared [Q the ordinary use of lawful exemp[io ns, o r what ex trinsic evidence mi ght prove the existence of fra udule nr intent."18 Yet, it seems clear [hat Congress. by usi ng nea rly identical language in ยง 522(0), intend ed fo r the "inrenr [Q hinder, delay, o r defraud" language in BAPC PA to be co nstrued in exacdy the sa me mann er as the fra udulent co nveyance and discharge provisions of II U.s.c. ยง 548(a) (I ) and ยง 727(a)(2), and examinatio n of the ex tensive body of Case law und er this secti on provides guidance as to what co nstitutes "inrend to defraud. "19 For instance, in In re Hogan,20 the debto rs attempted to convert th eir no n-exemp t assets into a sheltered ho mestead exempti on. O n th e eve of bankruptcy, they liq uid ated non-exe mpt assets, incl uding, amo ng other things. a recreatio nal home, fa rmland , and IRA acco ulHS. In additi on, the debto rs sold their principal res idence fo r $99,445.20. With these proceeds, they purchased a new ho me fo r $229,000 and clai med the home as exempt. A credi tor attacked th e transfers, claiming they were done with rh e intent to hinder, delay o r defraud credi to rs. The bankru ptcy court , recogni zing rh ar a debtor rarely, if ever, adm its to fraudul ent inrenr, noted that the o bjecting parry must

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generally rely on a combinati on of circumstan ces which "suggest that the debtor harbored the necessa ry intent. "21 Considering th ese circumsmnces, the court will th en "d raw an inference fro m this ev idence. "22 C riti cal to this infe rence is a co nsideratio n of the specific "badges of fraud . "23 These badges, whi ch are th e same under both federal and Arkansas law, are listed in th e Unifo rm Fraudulent Transfer Act (UFTA), and in cl ude: 1) the transfer was to an insider; 2) the debtor retained possession o r co ntrol of the property transferred after the transfer; 3) the transfer was concealed; 4) before rhe tra nsfer occurred, the debto r had been sued or threa tened with suit; 5) the transfer was of substami ally all of the debto r's assets; 6) the debto r absco nded; 7) the debto r concealed o ther asse ts; 8) the value recei ved fo r th e tran sfer was no t reasonably equival ent to the value of the asset tran sferred; 9) the debtor was insolvent o r became insolvent sho rdy after the transfer was made; and 10) rhe transfer occurred shordy before o r shortly after a substantial debt was incurred .24 In add ressin g the cred ito r's ho mestead objecti o n, the Hogan CO lIrt noted that three of the six tra nsfers made by th e debtOrs were made to members of their immed.i ate family, and a fo urth transfer was made ro the anorney advisin g rh em . In additio n, the transfers constitu ted virtuall y all of th e debto rs' assets and rendered them insolvent under the Code. Also, rh e debtors had bee n sued immediately prio r to the transfers. Moreove r, the debrors co ntinued to maintain control ove r the transferred properry. The co urt also noted th at it was q uestionable whether the debto rs had received a reaso nably equivalent value fo r so me of the properry tran sferred . The large number of badges, coupled wi th th e signi fica nt am o unt of transfers and the debtors' deceitful nature, led the co urt to hold rhar the creditor had successfull y shown an intent to defraud. Consequently, the debtors were nOt perm itted to claim any porrio n of the value of thei r res idence as exe mpt. No t all cases in vo lving significant pre- petition conversion of assets, however, wi ll res ul t in a find ing of fraudulent intent. In 111 re Bradley,'5 Michael Bradl ey personally gua ranteed a $40 mill ion co mmercial luan auJ perso nally bo rrowed $5 milli o n in o rder to pu rchase a flatbed trucking com pany in 1997. In 1998, Mr. Bradl ey, real izing his truckin g company was failing, bega n sell ing a substanti al po rti o n of his perso nal assets. Over th e nex t seve ral mo nths, he sold, inter alia, a herd of cattl e, a ho rse trail er, a rental ho me, his perso nal residence, and 250 acres of land. He also liquidated a 40 I (k) acco unt. Ove ral l, the net proceeds fro m tll ese sales amou nted to $433,630.96. No ne of th e sales was to a relative o r


business associate, all sal es were public and all the sales were for fa ir consideration. Bradley then used these proceeds to purchase a new hom e, wh ich he claimed as exempt in his Chapter 7 bankruptcy proceedjng filed shortly after the home purchase. The tru stee objected to the debtors' homes tead exemption, claim ing che prepetition transfers were intended to delay, hinder or defraud credi tors. Analyzing the [0 badges offraud, the Eighth Circuit Bankruptcy Appellate Panel found chat no such inrenr existed. First, the court fou nd that only twO of the badges had been satisfied: I) the transfers included substantially all of th e Bradleys' assets; and 2) the Bmdleys were insolvent at the time of the transfers. These badges alone, however, were nor enough to find the requisite intent. Mr. Bradley had a credibl e explanation for the transfers. He tes tifi ed that he was conce rn ed with tax obligations associated with the release from li ability for his personal obligation on the $40 million loan. Based upon advice from his counsel to purchase exe mpt property to reduce his tax exposure, Bradley sold his assets and purchased the homes tead. Assessing the rotality of the ci rcumstances surrounding th e transfers, the court found fraudulent intent lacking and affirmed the bankruptcy court's decision denying the trustee's homestead objection. The debtor was nor as fortunate in In re Sholdnn.26 In that case, prior to filin g a C hapte r 7 bankruptcy, Sholdan liquidated almost all of his non-exempt property co nsisting of bank accounts, certificates of deposit and a mortgage against his former farms read , and co nverted it intO exempt property in the form of a house worth $ 135,000. Sholdan daimed his new house as an exempt homestead under Minnesma law, which, like Arkansas, has adopted the UFTA and co nsiders badges of fraud to determine an imem to defraud. The trustee's objection ro the homestead exemption was sustained by the bankruptcy court and affirmed by the distri ct cou rt. On appeal, the Eighth C ircuit first gave its imprimatur on the use of the UFTA badges of fraud analysis ro assess the validity of a homestead exe mpti on objection. 27 Recogni zing that th e mere co nvers ion of non -exe mpt assets ro exempt assets is nor irself fraudu lent, the Eighrh C ircuir held rhat "there musr appear in evidence some facts or circumsran ces which are extrin sic to the mere tact of co nversion of non ~exempt assets into exempr and which ate indicative of such fraudul enr purpose. "28 Searching for the requisite ex trinsic evidence dut wo uld indicare an intem to defraud , the court noted thar rhe debtor was a rerired fanner, 90 yea rs of age and afflicted with se ri ous medi cal problems.

He had rece ntly been named as a defend am in a personal injury suir with damages well in excess of his li abi lity insurance coverage. At the time of the purchases of his new home, the debtot had been living in an ass isted-ca re facility, and prior to these livi ng arrangemcms, he had res ided in an aparrmenr for 13 yea rs. Yet, in what the court called "a radical departure from his previous lifestyle," the deb ror acquired approximarely $ 162,000 in cash by liquidatin g his assets and selling his mortgage rights to his nephew's step-brother. With that money. the debtor purchased and moved into a newlybuilt house. As parr of the home's purchase agree mem , th e debtOr's relatives requ ested that certain additions be made to th e house, sllch as a deck and landscaping and specifically inquired as to the amount by which the purchase price of the house would increase. These actions, accordi ng to th e majoriry, were sufficient to find an intent to defraud credirors. In a spirited dissent, Jud ge Ri chard Arnold, di sagreed with the majority's analysis and argued that the facts "show only rhat Mr. Sholdan, as allowed by law, pu tchased his home with the purpose of putting his assets beyo nd the reach of his creditors."29 Rejecting the court' s "radical departure from previous lifestyle" approach. Judge Arnold noted rhat a debror will always make so me so rt of departure from his previous lifestyle when he convertS property to proteer his assets) and "it is not normally the business of judges to decide what 'lifestyle' a citizen should choose." Requirin g the builder to make additions, in Judge Arnold's opinion, was simply an arrempt to prorect as much of the debtor's assets as the law allowed, which is not evidence of fraud. Finally, Judge Arnold reminded the maj ori ry that the "protection of the hom estead forwards important social policies of irs own" and is "as much a parr of justice as the protection of rhe rights of cred i(ors."30 While cases Are yo u too busy to take you r Social Hogan, like Security appeals to Federal Court? and Bradley We accept refertals for Social Security offe r Shoidan guidance on the appeals, and will return any remandappropriate analed case ro the referring attorney for ys is of a homefinal disposition. stead exemption claim, they do lirDo you practi ce in areas other than ric to defin e the Social Securi ty and desire to refer betwee n line

SOCIAL SECURITY CASES AND FEDERAL APPEALS

legirimate prepetition planning and fraudu lent co nv ers ion. Fraudulent intent case analysis is reminisce nt of the "we know it when we see it" approach taken in ce rtai n types of

clie nts ro an anorney who limits his practi ce to Social Security? We ca n handl e the claim from start to finish. CALL: DAVlD P. RAWLS T he Brad Hendricks Law Firm 500 C Pleasant Val ley Dri ve Little Rock, AR 72227 501 -22 1-0444 Toll Free: 800-603-5100

Vol. 41 No. lISpring 2006

TIle Arkansas Lm'Yer

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First Amendment cases and offers little comfort ro insolvency adv isors. The divergent views are particularly troublesome in light of the new I O-year reach-back period in BAPC PA since forgO[ten rransactions will now be placed under the fraudulent intent microscope)! It is therefore important for debtor and creditOr atto rneys and rrustees to ca refully analyze pre· petirion rransfers of non -exempt property under rhe UFfA badges to dercrmine wherher a homestead challenge is approp ri ate. PLACING A CAP ON TIlE HOMESTEAD EXEMfYI10N

BAP PA adds two signifi ca nt limirarions to th e ability to rake advanrage of Arkansas' hom es tead exemption . First, a debtor must now reside in Arkansas for 730 days prior to filing bankruptcy to claim an exemprion under Arkansas law.3 2 Secondly, BAPC PA places a federal monetary cap on the amount of the exe mption which may be claimed for homestead purchases within 1,2 15 days of filing bankruptcy. Under BAPC PA, a debtor may not exe mpt any amount of interest acq uired by the debtor during the 1,2lS-day period preceding the filing of a bankruptcy petition that exceeds in rh e aggregate $ 12S,OOO in the value of a claimed homestead plus th e amount transferred from a previous principal residence in the same state if acq uired more than 1,2 15 days before filing.33 The new cap does not apply to the principal residence of a fam ily farmer)4 As one court recently stated, "in its first major shift in arcitude since passage or the 1978 [Bankruprcy) Code, Congress began to put the brakes on rhe freedom in which states co uld protect th eir state residents by providing generous homestead protection laws. "35 Operation of rhe new ca p can be illustrated by loo king at how BAPCPA would com pel a diffe rent result in the Bradley case, supra. In Bradley, the debrors liquidated significant assets, including thei r existi ng home, and purchased a $480,000 hom e on rhe eve of bankruptcy. Under pre- BAPC PA law, the Bradleys were able ro claim rheir entire new home as exempt. Under BAPCPA, however, any portion of the $480,000 purchase price which exceeded the sal es price of the Bradleys' prior principal residence plus $125,000 would nor be exempt from cred iro r claims even though me transfers we re nor deemed fraudul ent. For exam ple, if rhe Bradleys sold their prior principal residence for $27S,000 and used all the proceeds towards their new home purchase, rhen $80,000 of the new home's val ue would be available for creditors ($480,000 - $275,000 - $ 125,000) . If the BradJeys' prior residence was loca red outside of Arkansas, then the exe mption wou ld be limired to $ 125,000 and $355,000 wo uld be ava ilable to creditors as shown by Nevada case decided under BAPCPA. In In r~ Virissimo, the Bankruptcy Coun for rhe District of Nevada conside red a case where two separate debto rs purchased homes in Nevada within 1,2 1S days of filing bankruptcy. The debtors did not previously own homes in Nevada and the equiry in each home exceeded $ 125,000. Nevada's homes read limitation is $350,000 and the quesrion was whether each debror's exemption was capped at $125,000. The trustee's objection to the exemptions in excess of $ 125,000 was sustained. JG In Virissimo, a critical factor in capping the exemption ar $ 12S,OOO was that each debror did not previously own another home in Nevada. Under §522(p)(2)( B), the inrerest acq uired du ring rhe 1,2 l S-day period preceding bankruptcy does nor include "any interest transferred from a debtor's previous principal residence (which was acqui red prior ro the begin ning of such 1,215-day period) inro the debror's current principal residence" but only " if the

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debtor's previous and current residences are located in the same state."37 A debror moving to Arkansas from anothe r state is thus nO[ enrided ro deduct the eq ui ty fro m the prio r our-of-sta te residence fo r purposes of determining the cap on the homestead exemption. Ie is imporranr to note rhat to take adva nrage of the equity in a prio r residence in the same srate, the prior residence must have been "acquired prior ro the bt:ginnillg of such 1,215-day pcriod. " Does the debror com plerely lose the benefit of rhe equity transfer exception provided for in §522(p)(2)( B) if his previous residence was also acq uired within 1,215 days of filing bankruptcy? At least one bankrup tcy co urt has held [hat if a debtor had equi ty in an y in-srare residence outside the 1,2 lS-day period, rhe debtor can use thar equ ity for purposes of the §522(p)(2)(B) excep rion." In In r~ wayrynen, the debror purchased his current Florida residence 44 days before fi lin g for $ 146,000 and claimed rh e full amo unt as exempt under Florida's unlimited homestead exemption. His prior residence had bee n purchased 966 days before filin g and the Trusree sought to limi t the homestead exem ption to $ 12S,OOO si nce [he prior res idence had nor been purchased greater than 1,2 1S days prior ro filing. The debtor had, however, purchased another Florida residence 5,824 days befo re filing and sold that residence for $ 150,SOO more rhan his purchase price. The bankruptcy cou rt for rhe Southern District of Florida held rhat the equi ty from this sal e could be used for purposes of§522(p)(2)(B) and si nce rhe eq ui ty of $ 150,500 exceed the value of his currenr reside nce, til e debror was enritled to complerely exempr his homestead. If a trustee or crediror successfull y ca ps a homestead exe mprion at $ 125,000, how rhey reach property deemed above the cap is determined by the bankruptcy court's app li catio n of state law.39 It is likely that a crediror is entitl ed to either: I ) a division of the property allowing rhe owner ro retain a homes tead and rh e creditor to seek execution on the remai nder of the land or 2) the sale of the property under execution with no bid to be received unless it exceeds the amOunt of the hOines read exempti on. If the partially exempt property is indi visible, such as a home, then the larrer oprio n must be chosen . Thlls. a crediwr ca n, and will. force an execution sale of an indi visible homestead, and the exe mpt value of the property wi ll be paid to the debtOr, while the remaining non -exempt proceeds are available to creditOrs. THE ULTIMATE CAP FOR BAD DEBTORS

The final significa nt homes tead exemption change under BAPCPA applies ro those debtors who have engaged in ce rtain types of wrongful conduct. Under BAPCPA, rhe homesread limit is capped at a [O(al of$125,OOO in two siruarions. The first is where [he debwr has been convicted of a fdony and rhe bankruptcy CO llf[ determi nes that the filing is abuse of Title 11 .40 The cap also applies where the debtor owes a debt arisi ng from: (3) a violation of securities laws; (b) fraud, deceit or manipularion in a fiduciary capacity or in connection with the purchase or sale of a security; (c) civil RICO penallies under 18 U.S.C. § 1964; and (d) any criminal act, imenriona.i rort, or willful or reckJess misco nduct that causes serious physical injury or death ro anothe r within [he S years preceding filing. 4! The only exception to the foregoing cap is where the property is "reasonably necessary for the support of the debror and any dependent of [he debror. "42 The intem of the foregoing cap seems clear with cases li ke Wo ridCom and Enron. Officers of entities like these will no longer

me


be able to shelter subsc3nrial sums in homesteads to avoid the results of securities law and breach of fiduciary dmies litigation. Mr. Porrer. WoridCom's founder and fonn er Chairman. wou ld not be ab le to keep his Florida ocean-from estate in the face of securities fraud judgments.

12. 13.

in ,he 10-year period preceding ,he filing of bankrup'cy.

14. 15. 16. 17. 18. 19. 20. 2 1. 22. 23. 24.

• Look for a debtor's conversion of non-exempt assets exceeding

25.

$ 125.000 duri ng ,he 1.2 I 5-day period preced ing ,he filing of bank-

26. 27. 28.

CoNCLUS ION

Consideri ng the new limitations char BAPCPA has placed upon the Arkansas homestead exemption, che re is little doubr that a homestead exemption no longer offers the broad prmcctions previo usly enjoyed by Arka nsas debto rs. Ir is th us imporranr fo r debto r and cred itor attorneys as well as trustees to: • Determ ine what equity exises in the homestead. • Look fo r badges of fraud in any transaction engaged in by a debtor

ruptcy. The practicc of advising financially troubled individuals to liquidate non-exempt assets may sti ll be viable wirh respect to homesteads th at have existed for 1,2 15 days (absenr other signifi canr badges of fraud), bur the option of liquidating and purchasing a new home is severely limited. • Be awa re of a debts arising from securiries/breach of fiduciary lawsuits, RICO actions, or criminal, intentional tOrtS or willfullreckless aces mat resu lted in serious harm to another. • If a debtor's current homestead was acquired during the 1.215-day period preccding the bankruptcy filing, determine whether the debtor had equity in any prior in -state home purchase that can be used to in crease the $125,000 homestead cap.

Endnotes I. 151 CONGo REC. S2306. S2342 (2005) . 2 . For example, O.J. Simpson moved to Florida after losing a $33 millio n lawsui t in California and cx plained to a reporter that the unl imited homestead exemption would al low him ro pro,ee< a mu l'i-million dollar house. 151 CONGo REC. H 1993. H2054 (2005). 3. Traditionally, thc scope of a state-created property exemption has been determined by reference to state law and not federal law. Panuska v. Johmon (In "Johnson). 880 E2d 78. 79 (8,h Cir. 1989). 4. Ba nkruptcy Abuse Prevention and Consumer Protection Act of 2005. Pub. L. No. 109-8. § 150 I (b)(2). 119 Sta" 23 (2005). 5. II U.S.c. § 522(0) (2005). 6. II U.s.c. § 522(p) . 7. II U.S.c. § 522(q). 8. Tisha M. Bartlm. Nou. Midduton v. Lockhart: Rllu 41(b). a

9. 10.

1 I.

Frauduknt Transfer, a Hom~suad. and a Homicid~-Did This Hard Case Make Bad Law'. 5G ARK. L. REV. 113. 129 (2003). ARK. CaNST. ART. 9. § 3 . Robert Laurence. Attacking the Acqllisition and Forcing the Sau of an indivisible Arkansas HomtIleatf, 55 ARK. L. REV. 473.474 (2002).

and tlu Principle of the Liberal Construclion of Exemption Staw", Analyzed. 57 ARK. L. REV. 221. 222 (2004). In re Kimball. 270 B.R. 47 1. 478 (Ba nkr. W.O. Ark. 2001). Laurence, supra notc 1 1) at 225. See. e.g.• II U.s.c. §§ 727(a)(2) and 548. II U.S.c. § 522(0). In ",Hoi,. 894 F.2d 1005. 1008 (8 th Cir. 1990). In" Johnson. 880 F.2d ar 82. Id. a, 81. In reMaronde. 332 B.R. 593. 599 (Bankr. D. Minn. 2005). In re Hoga n. 214 B.R. 882. 885 (Bankr. E.D. Ark. 1997). Id. Id. Id. id. In re Bradley. 294 B.R. 64 (8rh Cir. 2003). In reS holdan. 2 17 F.3d 1006. 1008 (8,h Cir. 2000). Id. a' 1009. Id. a' 1010 (qlloring from Norwcs, Bank Nebraska. NA V. Tve,en. 843 F.2d 871 (8,h C ir. 1988)) Id. a, 1011 (Arnold. R.• dissenting). Id.

29. 30. 31.

It is worth mentioning that "intent to hinder, delay, or defraud a creditor" should apparently be read in the conjunctive. According to the Eighth Circuit, "courts generally view this language as establishing a single test," and thus, rhe court wi ll not "endeavor to separate our the terms fraud, hin-

der and delay. " In re Johnso n. 880 F.2d ar 80 n. 1. II U.S.c. §522(b)(3). II U.S.c. § 522(p). II U.s.c. § 522(p)(2)(A).

32. 33. 34.

35 . 3G. 37. 38.

39.

40. 41. 42.

In re Marondc, supra nore 19, at 598. In reVirissimo 332 B.R. 201 (Bankr. D. Nev. 2005). I I U.S.c. §522(p)(2)(B) In re Wayrynen 332 B.R. 479 (Bankr. S.D. Fla. 2005). See In re Hyma n 123 B.R. 342 (Ba nkr. Fed. App. 199 1); In re Bronner. 135 B.R. 645 (Bankr. Fed. App. 1992); In re Girrs. IIG B.R. 174 (Bankr. Fed. App. 1990); In " Duffy. 240 B.R. 60 (Bankr. D. Nev. 1999); r. Gil N.W.2d 458 (Wis. 2000). II U.s.c. § 522(q)(I)(A). II U.s.c. § 522(q)( I )(B). II U.s.c. § 522(q)(2).

NEW

ETHICS ADVISORY OPI NIONS

T he Professio nal Ethi cs

omm ittee of this Association has

iss ued a new advisory opinion relating to conflicts of interests for outside co un sel for cities. The opinion is located at www.arkbar.com.

Robert Laurence. Mobile Homesteads, and in Particular the

Exempt Statll' of Mobile Hom" Located on Rmud Lots: The Laws ofArkansllS, Mississippi. Nebraska. and Utah Compared

Vol. 41 No. 2/Spring 2006

TIle Arkansas lawyer

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The Life and Death of a Reverse Mortgage By Angela Ma rlin Photos by Eli zabe th Ta rkington A ccording ro the lateSt US Census data, ap proximately 3 1.5 milli on Americans are age 60 and over. Of those aged 65 and over, less than 25% of men and 15% of women arc acrive in the labor force. Nea rly 90% of rh e elderly population rece ives social securi ty in come with less than half of those individuals rece iving other retirement income. The US Census Bureau reports th ar rhe average ann ual soc ial securi ty income for those 65 and over in 1999 was $ 12,300.00 . Ie is nor surprisi ng (hat many elderly experience difficuhy paying 1110mhly bills, health ca re and prescriptions costs, property taxes, and eve n rhe costS of daily necess ities, such as groceri es. A1th ough many individ uals over 6S do not have a large cash flow ro meet these COStS, the Census Burea u reports that 78% of the elderly po pul atio n ow n their homes. It would seem logical to tap in to rh e hOllle as a resource for funds whe n daily health care and living expenses can no lo nger be met. Reducing th e effect of economic hardship on rhe o lder population has been the goal of the Federal Housing Administration in backing H ome Eq ui ry Co nversion Mortgages (H ECM) to the elderly. An HECM is a loan in whi ch the lend er p rov ides money to the 16 TIle Arkans<1~ lJ\\ycr

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bo rrowe r in monthly paymencs o r as a line of cred ir. T he bo rrower is not requ ired to pay the mo rtgage back unless o ne of severaJ events occur, including the death of rhe borrower or sale of the property. H ECM's, co mmo nly known as reverse mortgages. are available ro individuals 62 and o lder who own the hOlll e that they res ide in. Th ere are numerous requiremems that must be met prior to a lender approving a reverse mo rtgage, and numerous o ptions to [he bo rrower o n how and when the funds are dispersed to rhem . The amount that a bo rrower wi ll qualify for depends o n his o r her age and the value of [he home. Generally, the older the borrower and mo re value in th e ho me. the larger rhe loan amount. In o rder to qualify for a HUD-backed reverse mortgage, a bo rrower must be I) 62 yea rs of age or o lder 2) ow n his or her home and 3) reside in that ho me. FHA aJso req uires that the borrower pay any outstanding mortgages, so that the H o me Equiry Co nvers ion Mortgage will be a first lien on the property. FHA/HUD also requi re that potential borrowers receive mortgage co unsel ing prior to processing of [he loan. When a potencial bo rrower contacts a lender regardi ng reverse mortgage. dl e lender mllst provide th e borrower with a list of agencies that provide cou nsel in g o n HECM's.


ARKANSAS BAR ASSOCIATION LAWYER COMMUNITY LEGACY AWARD NOMINATION FORM Date _ _ _ _ _ _ _ , 20 _ _ Name of Nominee _ __ _ ____________ Phone _ _ _ _ _ _ __ _ _ __ Office Address _ _ _ _ _ _ _ _ _ _ _ City _ _ _ _ _ _ _ _ _.Zip _ _ _ __ _ Name of nominator (if different from the nominee; self-nominations are permitted)

Name of Nominator _______________ Phone _ _ _ _ _ __ _ _ __ _ Address _ _ _ _ _ _ _ _ _ _ _ _ _City _ _ _ _ _ _ _ _ _.Zip_ _ _ _ __ Fax _ _ _ _ _ _ _ _ _ _ E-Mail _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ __ _ Category of Nomination

Please check the appropriate area(s) in which you are making the nomination: _ _ Aiding the administration of justice or the legal profession. __ Assisting civic, religious or other non-profit groups or individuals on a volunteer basis in a non-legal capacity. __ Educating the public or individuals or students about legal matters. _ _ Providing pro bono legal services: in a significant matter; or in a significant number of cases; or in a way that significantly changed the life of one person or group. _ _ Working in conjunction with the court system to make it more welcoming , inviting and understandable for jurors, witnesses or victims of crime. __ Working as a volunteer with youth groups of any form. Please attach a signed statement describing the work of the nominee in the category selected, along with a detailed description of why the nominee should be considered for the Award. SEND TO: Arkansas Bar Association, 400 West Markham, Little Rock, AR 72201

Recipients of the Award will be notified by the Association and will be presented with the awards in their local communities. The Guidelines for the Award are available at www.arkbar.com. Nomination deadlines are January 31st and July 31st of each year. The Lawyer Community Legacy Awards are presented to attorneys and judges who have performed

volunteer public services out of a sense of duty, responsibility and professionalism. Because the Arkansas Bar Association wishes to acknowledge these unsung heroes and heroines in the communities where they live and work, the nominator(s) is responsible for selecting a forum for the nominee to receive his/her award and for facilitating the event. The Association will make an officer available to present the Award and will be responsible for the costs of the Award Plaque.


A lender ca n nor charge an appiicarion fee, may not order an appraisal or tide work, and may not cha rge for any other HECM relared services unril co unseling has bee n compl eted. H UD guidelin es do nor allow a lender [Q recommend or encourage a borrower to seek co unseling from a specific agency and do nor allow counselors ro provide specific pricing information for individual lenders. All panics on the property deed are required ro attend co unseling. Counselors must discuss options, other than reverse mon gages, finan cial implica ti ons of emering into a HEC M, disclose that reverse mongages may affecr eligibili ty fo r other local, state and federal programs, and discuss the ramifi cations of a reverse mon gage on srare and federal taxes, and the esta re and heirs of rhe borrower. Once a borrower has qualified and completed counseling, rhe loan process can begin. Once the lender has received the loan application and supporting documentation, the borrower wi ll receive Truth in Lending disclosures required under federal guidelin es. In 1994, signi ficam chan ges ro the Truth in Lending Act were enacted to com bat issues that arose over reverse mortgages and lawsuits thar publicized those issues. Several class acrion suits were filed by borrowers claiming predatory lendin g. The revised act requires that the Total Annual Loan Cos[S (TALC) be disclosed co reverse mongage

borrowers three days prior

to

the closing of the loan. This calcula-

rion is the total annual loan cos t with all charges co nnected to th e mongage incl uded . If the borrower decides to obtai n the mortgage, he or she may choose from several different paymem options. T he borrowe r may opt to obtain a line of credit, momhly payments over a specific life of the borrower, and monthterm, monthly paymems over ly paymems over as specific term and based on a line of crediL A borrower may be able to adjust their payment option during me life of the loan. Borrowers may also include monthl y servicing fees, origination fees, appraisal and title fees, and closing costs in th eir loan amoull[. However, inclusion of these kinds of fees will reduce the actual amount paid out to the mortgagor. Unlike conventional loans, reverse mortgages are non-recourse loans. This means thar th e borrower will never have to pay th e lender over and above me value of the property. Under th e provisions of the mortgage a borrower could outlive the expecred life of the loan , continue to receive payments under th e mortgage. and incur a loan balance well beyond the val ue of the home. Regardless of this, the lender will not be able to collect the overage from the mortgagor, estate or heirs. Ie is relevant to note th at FHA guidelines place no restri cti on on what the mon ey can be used for. Although many elderly obrain the loan primarily to pay for necessary ex penses, th ere is a trend toward qualifying individuals "cashing our" the equi ty in their home and spending it on trips and vehicles. Some elderly mortgagors also opt to cash out their equity to give to their heirs while they are still alive, ramer than opting to leave the hom es tead to children after they have passed . No matter how much mon ey is borrowed or what it is used for, there are several events m at can ca use the loan ro become due and payable. One of the mai n events is the death of the borrower. Upon the death of the borrower, th e estate has the option of paying off the loan balance up to the val ue of the home or selli ng the property.

me

FHA has loosened its ini tial requirement that the lenderlse rvicer obtai n approval from them ro grant th e estate up to 6 months to market the property. The initial guidelin es required th e lender to ob tain approval from FHA to extend foreclosure referral s to allow the esta te time to sale the property and/o r payoff the loan. Several sources nOtC that less than 10% of reverse mortgages are paid by the esta te or heirs of deceased borrowers. The majo ri ty of defaults due co death are referred for foreclosure. The guidelines state that, in states that have statutory foreclosure laws, the mortgage can be foreclosed under rhe stature and there is no requiremem ro do so in a judicial action. However, there are unique issues that must be

addressed when a HECM has def.lUlred due to the death of the borrower. The major issue is providing notice to the correct parties, such as execumrs and heirs. This can be easily addressed by a proper search of the reco rds for any probate, affidavits of heirship or conveyance documents thar should be locared in the public record. Other events thar will prompt th e servicer or lender to declare rh e loan due include fai lu re to maintain the prope rty under HUD regulations, failure to pay property taxes, or otherwise encumbering the property in a way rh at would ca use the reve rse mortgage to be subordinate to anoth er lien. HUD also rcqui res that the borrower reside in rhe property. If the borrower resides outside of m e home for more [han 12 months, a default is triggered. Las tly, a sale or conveyance of the property wi ll also require payment of the loan balance up to the value of the home. Inruviduals who are eligible for and considering a H ECM should be cautious in understanding the guidelines and rhe consequences of a reverse mortgage. It is important that the borrower real ize that they may be sacrificing their hei rs' claim to the land and home. It is also importanr that elderly inruviduals understand all of their options if they experience difficul ty meeting their living expenses. There are numerous resources that explain the pros and co ns of HECMs and also offer advice on other local and fede ral programs that might be able to assist with daily ex penses. If you are interested in learning more abol![ these programs or reverse mortgages, you may go to \ÂĽ\VW.aarp.com, www.hud.gov, or www. hecm reso urces.o rg. All ce nsus information was obtai ned at ww'v.census.gov. â&#x20AC;˘

Angela Martin graduated from University of Mississippi School a/Law. She has been with Wilson & Associates for 2 J12 years. Her main area of practice is real estau and she mainly represents clients from the mortgage and banking industry. Vol. 41 No. 21Spring 2006

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www.arkbar.com

TROUBLESHOOTING PASSWORD PROBLEMS O ccasio nally computer glitches can cause one's passwo rd to become invalid . Th is problem can easily be remedied by checking a few basic steps . • First, be sure you have entered yo ur fu ll Supreme Court l D number with no dashes (your number contains six digits if yo u were admitted before the year 2000; seven digits after) · Second, make sure your "Caps Lock" key is nOt on. T he password entry m ust be lower case.

• If these twO entries are correct and yo u still cannot log in , double check to be sure yo u have previously registered. T he registratio n butto n is just below th e Log In box. C lick o n the "Register" butto n and fo llow th e directions. If you go through the registratio n process and reach t he "Log In Successful " screen your password will arrive via e-mail wi thin a few minutes from the"Web Server User" e-mail address. Be sure to save your passwo rd in a safe place fo r future reference. • Lastly, there are specifi c browser settings necessary for utilizing our on li ne legal research tool, Arka nsas VersusLaw. If o ne encounters a "Server Application Erro r" after logging into Arkansas Versus Law, simply contact their cusromer service department at (888) 377-8752 fo r technical suppo rt in adjusting your browser settings . • If the above steps are not successfu l, cal l the Association at (50 I) 375-4606 or (800) 609-5668 .

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The Uncertain Gift: Arkansas' New Beneficiary Deed BY CHRISTO PH ER BARRI ER

Act 1918 of 2005 ("the Act") is intended to al low owners of Arkansas real estate

(Q

pass ride

[0

that

real estate on their dea ths direcdy ro their chosen beneficiaries, without making th e real es tate the subject o f probate proceed-

IflgS, as a devise by wi ll o rdinarily

would. To do this, the Act creates a new term and ~pe of conveyance, rhe "benefi ciary deed . n It permi ts a granro(

(0

execute and reco rd a deed

to an inrercS[ in real estate to a third parry. bur

[0

ex pressly sta re th at the

conveyance becomes effecti ve only lIpon rh e gramor's de:nh at a time when rhe grantee has survived the granto r. The device is no r limi ted to co nveyance of fee rid e. bur is applicable

[0

an y interest in real estate,

includ ing a li en a nd the debt which it secu res.

Fr

to b

In rhe mea ntime. the gtamor is free to lease, encumber and mh erwise deal with the real estare, as if rhe beneficiary deed did nor ex ist, so th at th e gra m ee may get th e reaJ property subject to mo rtgages and other lie ns crea ted at any tim e prio r CO th e gra nto r's dea th . Th e grantee is nm required ro join in any such lien instrumems, bur is in a posirion similar co that of a devisee of the property under a will, for those purposes. A lack of trust! . . These res ults, of cou rse, could already be achieved by use o f a trusr, wh erein the trustee wo uld rake tide co th e real estate. 20 TI1 C Arkansas la"ycr

www.arkbar.com

T he sponsor of th e legislation , Rep. John Verkamp, has res po nded that such trusts are roo ex pensive fo r people of modest means, who also are relu ctant to use [ruses beca use they are perceived as appropriate only for wealthy peop le. Retain ed li fe estates do nor serve the purpose, he maimai ns, because they are not subject co revoca tio n, while benefi cia ry d eeds a n ::, a:, arc wills and trUSt agree ments. Rep. Verkam p also draws a parallel co typi cal payab le-o n-d ea th provisio ns in bank deposit aCCO lllHS o f all kjnds, and also co unifo rm transfer-o n-death statutes for securities acco unts, a ve rsion of which was enacted in Arkansas in 1993 as th e Uniform

TOD Security Registration Act. codified as Ark. Code Ann . ยง 28- 14- 101 - 11 2 ("TOO Act"). An apparent preference! .. The pro perty conveyed remai ns subject to th e claim against rh e grantor's estate in fa vo r of the Department o f Human Services provided for in Ark. Code Ann. ยง 20-76436, in rhe event the other assets on the granto r are insll ffic iem co pay the DHS claim and m her clai ms, but apparendy o n a preferemial basis. Fo r exampl e, if th e net assets of the esta te are sufficient CO pay 80% of the claims o f th e ge neral credirors of th e es tate wit ho m the d eed ed prope rry. but 100% with it, the Act ~ to say DH S


ca n collect irs rem311llllg 20% from rhe value of th e deeded properry, bur it is ~ as (Q the Ol'hcr crcdirors. The TOO Act simply says transfers-ondeath und er its provisions do "not lim it the rights of creditors ... aga inst beneficiaries and other transferees under other laws of [his sr"e." Ark. Code Ann. § 24- 14109(b). New Mex ico's ve ry brief statute says essentially the same thi ng. (N.M. Stat. An n. § 45-6- 101 -B). M issouri's very co mp rehensive sta m « (RSMo § 46 1.003-46 1-08 1) says claims arc collectabl e o ut of the val ue of the property co nveyed by beneficiary deed o nly after app lying th e rema ining assets of the estate. (A rizo na, Colorado. Kansas, Missour i. O hio and New Mexico have statutes creati ng a si milar eype of conveyance, bur none ap pear (Q take Arkansas' app roach [0 DHS claims.) la r io The A" emph atically denies [hat any legal or equitable estate whatsoever is created in the grantee by the record ation of a benefi ciary deed. It allows the conveyance ro create (upo n its effective ness) sta nd ard estates in real estare, such as tenancies by the entirety, joi nt tenancies and tenancies in co mmo n. As with wills, successor grantees may be named, in case the initial graIHee does nor survive the gramo r. and the grants may be otherwise co ndiri o n ed -~-for example. the initial grantee might receive the property o nly ifhe has reached [he age of30 at the time of the gramo r's death. Husbands and wives and joint tenams may also execute and record such deeds, bur execurion by.all of rhe owners of interests is llill necessarily req uired . For exa mpl e. should a wife execute and reco rd a benefi ciary deed to real es tare owned jointly with her hu sband. the deed wou ld st ill be effective on her J eadl .if ~ h e were pre-deceased by her husband. Conversely, we re she ro predecease hlm.. the beneficiary deed wou ld lapse hccause she would have no title to pass at her death. Trusrees of truses ca n be grantees. even if the trusts are revocable, so long as they are not revoked prior to the gram o r's death. O ut w ith the old ... The statute appears to make me welles tablished concepts of delive ry and co nsideration irrelevant ro such deeds, in a major departure from the co mmon law. O nly ruordll.tioll prior ro the gram or's death makes th e beneficiary deed effecti ve. and

The statute appears to make the well-established concepts of delivery and consideration irrelevant to such deeds, in a major departure from the common law. delivery [Q th e gramee would be irrelevam without that reco rd at ion. No co nsideration is required for such conveyances and presum ably no revenue stamps. (The statute itself does not memi on co nsideration, although th e other states' sta tures do. However, the form of deed set our in rhe sta tute does D.2.t, so, by inference, it is not required, which would be ano ther profound departure fro m th e co mmon law of centuries past. Ca reful drafters should not rely on inferences. of course, es pecially si nce the form is required ro com ply "with other appli cable laws .... ") h at a k As nored above, unlike conveyances wi th retain ed life es tates, beneficiary deeds may be ~ in the sa me manner that th ey are crea red---that is, by executing and recording a revocation prior ro th e granto r's dea th. They may also be revo ked under th e Arkansas starure by executing and recording ~ beneficiary deed to someone else or by an absolme conveya nce, ro a third parry or the origi nal gramee. Again. it is the date of recordatio n that' comrols, llill of executio n or delivery. And the same ru les ap ply as to other estates. For instance, in the hu sband and wife situati on, suppose both executed and recorded a beneficiary deed. W hil e he was still ali ve, he executed and reco rded a revocation . If he pre-deceased 00. the revocaljOIl wuu lJ ue or no eFrecr, but if she predeceased him, the revoca tion would be effective withour her execution. Revoca tion by one of the statutory procedures is the 2ll.ly effective method. It Qill!!Q1 be effected

by wi ll or o ther unreco rded writing. Duly noted " . In the case of a mortgage securing a note, the debro r would cominue ro (rea r the gramo r as the creditor durin g the gramor's lifetim e. but th e note wou ld !!Q! pass through probate and the debtOr would have to recognize the gramee as th e creditor upon the gramor's death. As noted, the Act provides forms of the beneficiary deed itself and also the revocat io n. Pres umabl y, additiona l provisio ns could (a nd probably sho uld) be included as well. so long as the bas ic elemems and recitations 3re retained, but litigatio n on both poims seems inevitab le. T h ecoo " w . .. From his review of the statutes of the other six S[3tes and commentari es on them. Rep. Verkamp listed the benefits of the devi ce as follows: (a) the expense and effon of probate are avoided; (b) the expense (which he estimated as $ 1000 or more) of preparation of trust documents is avoided; (c) there is no ongoing expense and effort of trust administratio n; (d) there arc no restrictio ns o n use or disposi tion of the real estate; (e) there is no gift tax o n transfer; (f) me gram can be switched to a differenr grantee; (g) the grant can be revoked. T he not-so-good news. , , Lawyers Susan M. C iupak and Joshua Forest, on the other hand, commenting on the Arizona versio n of me scarure in the October 2001 issue or the Arizolla JOIln/al ofReal &tot< 6- B/lJill~ nored drawbacks in mat stare's version of the legislation (whjch the Act most nearly resembles); (a) the property remains in

Chris Barri(r hIlS practiced real (sta/( law with r/l( Lit/I( Rock firm ofMitd"lI. Williams. 5<lig. Caw & Woodyard for ov," 38 y(ars and is II fomur chair of r/J( Association s Rtal Esllll( lind fInancial Institutions Law Sections. He is a graduate of Hmdrix Colll!f,< alld Duk< Univmity School of Law.

Vol. 41 No. lISprin!) 2006

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the gramor's uxable esuce; (b) it ca nnot be used as a trust ca n to deal widl an inheritance by minor children; (c) it is very cumbersome, both fo r granti ng and revocation , when there are multipl e ow ners; (d) li ke th e Arkansas version, the statute does nor permit a res tri ctio n on revocation on the part of a survi vor, even in contradiction of an earlier prom ise o r understa nding; (e) because of the need fo r possible revocat io n, there is an increased chance for erro rs in the process, especiaJly with multiple owners; (f) it may not be clea r to ririe researchers and others viewing th e reco rds that the imeres r docs not ex ist until the grantor's death; (g) a beneficiary deed grantee may be mi staken as a remainderman; (h) revocation by only one co-owner may leave un certain the ex tent of the revocation; (i) revocation by a nongraming co-owner may cloud the grantee's interest; (j) subsequent addition of a party as owner (fo r exampl e, a seco nd marriage) after granting of a beneficiary deed may call imo question the grantee's rights; (k) there is no requirement of filing the death certificate o r otherwise proving the death of th e gtamor; (I) a potential conveyan ce by a benefi ciary deed to unborn grantees brings into question the validity of entire transfer, who ho lds the property in the interim and the potentiaJ application of the Rul e Against Perpetuities; (m) there is potential unce rtainty pertaining to whether the conveya nce by beneficiary deed transfo rms a joint tenancy with right of survivorship into a tenan cy in common; (n) there is potential co nfusion concerning the delay or failure to record, and subsequent grants of beneficiary deeds; (0) th ere is potenrial for litigatio n conce rning the subsequent recording of a prior grant of beneficiary deed, as rh e legislation provides th at the lasr recorded gran t prevails; (p) whether a foreclosing party mUSt give notice of foreclosure to 3. gr:uHcc beneficiary. Most of these drawbacks also clearly apply to the Act. Grant. bargain and confuse ... The very nature of the device appears to engender confusion. In Pippin ll. Pippin, 154 S.W3rd 376 (2004 Mo.App.), decided December 2, 2004, a co upl e essentially tried to use a beneficiary deed to achi eve rhe same resul[ as a deed with a retained life es tate. Because the magic wo rds regarding effectiveness on death were not included, the conveyance was not valid as ei ther form of conveya nce. Even conventio nal deeds with retained life estates have been rich sources of

Having been offered the beneficiary deed as a cheap substitute for a trust agreement, the client may have to use it to accomplish less than all of her aims, such as benefiting unknown heirs or providing for various contingencies . liti ga tion in Arkansas. See, fo r exa mple, King v. Sinter, 96 Ark. 589, 133 S. W. 173 ( 1910) and Whetstone v. Hunt, 78 Ark. 230, 93 S.W 979 ( 1906). Trying to use a benefi ciary deed instead of a revocable truSt will at the very least limit the grantor's ability [Q nam e "'the natural objects of her bounty," and thus clari fy her intentions. Such clarity may also avoid a lawsuit by disgruntled heirs, as represe nted by another Missouri case, jolly v. Clarkson. 157 S.W 3rd 290 (2005 Mo. App.), decided January 28, 2005. Breaking the Code . . . Additionally, the Act in Arkansas not only changes existi ng common law but possibly othcr statutes, notabl y Ark. Code Ann. § 4-3-20 I et seq. and Arride 3 of che Unifo rm Commercial Code in general. For exa mple, under existing law, a mortgage esse nti ally follows the secured nQ[e. Ark. Code Ann. § 4-3-30 1. In ocher words, if a secured note is endorsed and transferred, the li en is also transferred. It is the note that the debtor can require to be exhibited as a co ndition of makin g payments to the holder. Should a beneficiary deed be used to transfer a debt and lien, upon the death of the original creditor the grantee becomes the creditor and lien holder, bur the note will neither have been endorsed nor will it have even been delivered to the grantee. Further, si nce the point of aJi this is to avoid probate, there will be no perso nal represcntative to endo rse and deli ver the no tc. The note could in fact be endorsed prior to the grantor's death to a third party who cou ld present it for payment. The debtOr wo uld not necessa ril y even know thac the grantor had died, much less be alerted to check the real esrate records fo r a beneficiary deed and, hence, a new holder. T he integrity of the record has been co mpromised by rhe Aer. The Act atte mpts to deal with this, bur by all owing the debtor to require proof of (a) rhe payee's death, and (b) no n-revoca tio n. It says absolutely nothing abol!{ exhibiting W nore itself.

A q ues tion of polic:;y , . . The clear [rend with regard to fiduciaries is towa rd openness and informativeness. For example, the Uniform Trusr Code requires a newly-a ppointed trustee to notify th e principal benefi ciaries of the trUSt of her appointment prompdy after accepti ng it. Un if. -Irusc Code § 813(b)(2). Thac policy runs through the enti re UTC, whi ch was adopted last yea r in Arkansas as the Arkansas Trusc Code (Acr 1031 of 2005). A granror co uld reco rd a beneficiary deed to a significant real estate asse t and later draft a will inconsistent with that conveyance. The perso nal representative collectin g [he assets would probably be aware of th e asse t, bur would she run a tirie check to make sure there was no prev ious co nveyance? The situation is n.ru: the same wi th a conveyance of property with a retai ned life estate - there has been a present conveyance, probable chan ges in tax bills and other opportunities for actua l notice of the conveyan ce. Further, many if not most such conveya nces involve a support dud - that is, a co nveya nce in return fo r suppo rt for the remainder of the grantor's life. H ence, the grantee is obviously go ing to be aware of the conveya nce. Short-changed by shorthand •• . Barga in ing successfully for support In return for a revocab le beneficiary deed, on the other hand. see ms unlikely. Bur, the shorthand represented by suppOrt deeds also frequently results in legal wrangles, especially when combined with a retai ned li fe eState. See, fo r exam ple, Rost ll. Durm, 284 Ark. 42, 679 S.W.2d 180 (1984); Seboly v. Seboly, 208 Ark. 1008, 188 S.W.2d 625 (1945); and Rumph v. Rowe, 230 Ark. 64, 320 S.W. 2d 749 (1959). Cucring corne rs on documentarion just naturally increases cOStS, and ca rel ess use of benefi ciary deeds ca n be ex pected to produce si milar conseq uences. Circumstances can also alter results. A grantor typically has some co mrol over when an instrument is delivered, but nOt necessarily when it is recorded. For exam ple, an ailing grantor may exert her best efforts

Vol. 41No. 2/Spring 2006

The Arka nSaS Lawyer

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co get a beneficiary deed placed of record , but be penalized because her lawyer has left it on his desk (3 porcnrial liability issue), o r the courthouse is closed. There is no such thing as co nstru ctive reco rding, and constru cti ve delivery does nor co um. 13 0 unint nded onse uen The same issues ho ld true with regard to revocations, and with perhaps more likelihood of an unintended result. Suppose a gtamor executes and reco rds a beneficiary deed co her daughter and son-in-law to Arkansas real estate. She then retires to O regon. Daughter and so n-in-law get a divorce, so the grantor is anxious ro execute and reco rd a new beneficiary deed, perhaps ro herself as trustee of a grantor trust for her daughter and grandch ildren, or at least a revocation. Instead of havin g her wi ll or trust agreement rev ised in Oregon (maybe eve n on a ho lographic bas is), she now needs CO get a new instrumenr (I) drafted (presumably by all Arkansas lawye r). (2) sent ro Oregon for execution and acknowledgment. men (3)

returned to Arkansas, where (4) hopefull y it will be reco rd ed . Remember. the Act IllQ:. hibirs revocarion by any method other than a document reco rded in the app rop ri ate Arkansas coun ry before th e gramor's death .

Saying what yo u mean . . . It i ~ simplt: t:llough. a nd customary. to write inro wills or trust documents provisions for bequests to pass to heirs of an individual devisee who does not survive the testator or grantor, withom the necess iry for them even being identifiable at that time. But, a benefi ciary deed is a conveyance. and it is not clear at all that such a provision could be included in such a deed in Arkansas. In fact. it appears that the Ohio statute (ORC Ann. ยง 5301 , et. seq. ) does not allow inclusion of a gra ntee who can nor be spec ifi cally named, (i.e., unnamed heirs of a grantee who f..1ils to survive th e granto r), whi le the Missouri versio n (noted above) co ntains a lengthy provision allowing ir. Again . careful drafters in Arkansas would follow the Ohio model , in me absence of case law or suppl emenral legislatio n. o r risk

unfo reseen lapses. These rypes of issues also underline the differences between cerrain classes of perso nal properry. as co ntemplated by th e TOO Act, and real es tate. Money and securities aCCOU!HS are fun gible and not specifical ly identifiable, and are also the subj ect of documentation maintain ed by a third parry. such as bank o r broker. Hence, not only is a tra nsfer on the third parry's reco rds easily ve rifiable. it has the Aex ibiliry of a trust or will. and it gives rh e third parry protecrio ns it obv iously needs. ~ of these considerations app ly to real esrate. The Act ostensibly deals with the impacr of divorce or bankruptcy on beneficiary deeds by sayin g (hat those eve nts cause a benefi ciary deed to "be (rea(ed as a revocable rrusc... " Presumably, th e inrention is that either evell{ revokes th e deed. Bur, it docs not say whose divo rce or bankruprcy has (hat impacr---of the granto r o r the grantee? Further, should a deed ro a spouse be treared in the same mann er as a joint deed to the co uple's children?

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~. arkbar. com


T ide insurance iss ues . . . Because Colorado and Arizona have so me experience with this device, ritle insurers in those sta tes have developed guidelin es for dealing with beneficiary deeds in th e chain of tide, so me of which are peculiar ro rhe version of th e law enacted in those states. Otherwise, the matte rs to be dealt with before getting a tide insured that stems fro m a beneficiary deed are frankly not that much different than those arrendant to any transfer of tide, ar least in rhose stares. bur Arkansas insurers may view ir differently.

Looki ng for guidance . .. The starutes of th e other six sta tes have more differences than similari ties. For exam ple. Colorado specifically perm irs revocation by wi ll . C.R.S. Sus. 15- 15-401-409. Missouri has had a comprehensive statute since 1989. which deals in detail with the impact of divorce or failure to mention one's spouse or children, unlike the other statuces. Hence, we simply ca nnot look to the S£aturcs an d case law from those srares for assistance in resolving the un certaimies and amb iguities in the Act. T he practitioner's dilemma... These issues (especially as exe mp lified by rhe Ariw na comm entators' ex haustive list) represent grave co nce rn s for both clients and lawyers. Having been offe red the benefi ciary deed as a cheap subsri tute for a trust agreement. the client may have ro use it to accomp lish less than all of her ai ms, such as benefi ting unknown hei rs or providing for various contingenci es. Shouldn 't the lawyer make sure (and document) that the client understands this? It is nor difficult ro imagine a lawsuit by an unnamed heir claiming that the client clearly did not. And, whar is the lawyer's professional responsibili ry in terms of making sure the dient's genuine needs are met by the methods chosen?

Most rea l es rare lawyers have been asked by diems ro dra ft co ntracts for deed, wherein rhe buye r gets no deed or wa rranti es until the unpaid balance of the purchase price (whi ch mayor may not be represented by a nore) has bee n paid off. T hese clients want rhe abili ry to leave existin g mortgages in place and, upon defauh, [Q simply ca ncel the co ntracts an d be free (Q sell the properry to someone else, without fo reclosu re. Someti mes those contracts get recorded, bur, even if th ey do nor, th ere is a ve ry strong argument thar foreclos ure is indeed necessary (Q clea r rhe tide, es pecially if the buye r has bu ilr up a substant iaJ eq ui ty in rhe pro perry, so as to render the ca ncellario n a de facto fo rfeiture. T he client's best interests .. . Many lawyers are reluctant ro draft stich contracts, because the clients clearly expect to achieve an unfair advantage, bu t in fac t may nor get it. The Act may create a similar dilemm a. Ar a minimum, because of the possibilities for co nflict and co nfusion, lawyers may want to co unsel clients strongly against usi ng a benefi ciary deed (Q transfer a mortgage and the note it secures, beca use rhere are far better and safer ways to acco mp lish th e purpose. L1wye rs may also want to develop short forms of single-asset trust agreements that would add ve ry little ex pense to the process of preparing a deed, which in rh is instance would be to the trustee instead. They can not force them on their clients, and a thorough discussion by the appropriate commi ttees of the Associatio n clearly should precede [heir development and lise. But. rh e du ty (Q ex plain the drawbacks of the benefi ciary deed to their clients and to vigo rously present [he alternarives is JUSt as clea r. _

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www.warnersmith.com Vol. 41 No. 21Spring 2006 111e Arkansas Lawyer

25


ARKANSAS LAWYER DIVERSITY OUTREACH REGISTRY: AJOINT

W. HAROLD FLOWERS LAW SOCIETY AND THE

VENTURE OF THE

ARKANSAS BAR COMMISSION ON DIVERSITY by Colette D. Honorable and Peter G. Kurnpe

The Arkan sas Bar Co mmi ss io n on Diversity was created under the leadership of Arkansas Bar Pres ident Ron Harriso n in rh e 2000-0 I bar year. Initi ally. the Co mmi ss ion was chaired by President Harriso n and th e H onorab le H enry L. Jon es. Th e purpose of the Commission is to educate concerning the value of diversity, and ro promote ethnic diversiry in the Bar, the Co urts. and the Arkansas Bar Association. It has sponsored programs at the Association's annual meetings and at the mid-yea r meetings. It organ i7..cd a seminar co ncerning diversity in the legal profess ion, and hosted a job fair to promote diverse emp loyment. In its deliberations, the Commissi on determined that di versiry in th e legaJ professio n could mo re certainly be ach ieved if rhere were mechanisms for identification and recruitment beyond the placement o ffi ces of the law school s and that would utili ze th e organized bar. Th e structure that was develo ped is a registry or database to be maintained by the Arkansas Bar Association. The regisrry will be created and administered under a joint ve nture agreement berween th e Arkansas Bar Commission on Diversity and the W. Harold Flowers Law Society. Th e cost of creating this resource has bee n fund ed by a g rant from th e Winthrop Rockefeller Foundation. The grant is being administered by the Arkansas Bar Foundation. In addition to funding the registry, the \'V'inthrop Rockefdler Foundation grant is also funding a survey, presently being conducted by the Institute of Governmem on Ih e UALR ca mpus. This survey was sugges ted by rhe sraff of the W inrhrop Rockefeller Foundation to id entify lawyers of color prese ntly practi cing in rh e state. This information had neve r been co mpiled, and the hope is that thi s reso urce will enhance the effecti ve ness of th e registry and provide an information baseli ne to co mpare ou r 26 The Arkansas la\\ye r

vvww.arkbar.com

progress in promoting diversity. A key el ement of this project is the mobiliza tion of th e membership of the W. Harold Flowers Law Society and the Arkansas Bar Associat ion co promote employment opportuniti es fo r lawye rs of color. The Flowers Law Society will take rhe lead in promoting participation by recruits; members of the Commiss ion and the Association will be asked co prom ote partici pation by employers. These efforts wi ll take the form of direct solicitation and outreach through bar associations around the state. Among the subsidiary conce rns of th e reg istry is the ed ucation of potential employe rs co nce rning predi ctors of professional sllccess other than simply law school grad es. The registry wi ll also arrempt to id entify employm ent opportunities for lawyers of co lo r in the less urban portions of the sca te and seek to provide oppo rtunities to improve the employment situation for la\vyers of color who may be underemployed. This resource is now available and can be accessed at the Arkansas Bar Association \'V'eb site (www.arkbar.com). Select the link to the Diversity Registry. There you will find a form for emp loyer registration and another form for an attorney registration. Si mply complete the appropr iate form and fax it to rhe office of th e Associarion. (50 I) 375490 I. Members of the Dive rsity Registry Task Force, comprised of members of the CO lllmission and the Flowers Law Society. will periodically review submiss ions and fol low-up o n inquiries. The goal is to match appropriate ap plica nts and potential employers. Th e rol e of the Registry and its administrarors is nor to supplant the normal recruitment, eva luation, negotiation . and hiring process, bur to enhan ce it. Under most circumstances, potential employe rs would be provi ded with resume-eype information from applica nts marching predetermined

criteria, and then the emp loyer will proceed with its normal hiring process. In other cases, registry administrators may appropriately prolTIme candidates or hiring oppOrtunities to insure both sides of the potential employment relationship fuHy appreciate the opportuniry offered by the other. That Arkansas is a relatively small state provides unique opportunities for perso naJ interaction and evaJuation. Beca use o f this characteristic o f the legaJ job market, those of us involved in promming this effort are optimistic that we can create and exploit oppo rtunities on a perso nal basis that wi ll insure that the work place, our legal system, and our association achi eves aJl of the benefits offered by the diversity that has enri ched our community and our profession. _

--.

Ms. Honorable is ChiifofStafffor Attorney General Mike Beebe. She is President .-!. ~ of th, W Harold .~ Flowers Law Society. and serves on ArkanJm ...,.,; Bar Association HoIIS' of Drlegatrs. Sh, obtai,,'" 1m JD d'gru from VALR School of La w.

. â&#x20AC;˘ 'I ,

s

M r. Kumpe is a commerciallitigator and parmer il1 Williams 6Anderson PLe in Little Rock. He i.s a pml co-chairman of the Arkan.sas Bar Commission 011 Diversity. He is a graduate ofthe University ofArkansas at Little Rock. and obtainet! hisJD degree III the University ofuxas at Au.stin.


Arkansas [OLTA Foundation

\i~~"o;;;;;;;;:==~::t~rSt<.te.s, in order to fom. a 1II0re perfect Ullioll, establisll JI/stice,

Provide for tire

comlllOIl

defellse, prolllote tire genera l Welfare,

to ollrselves alld ollr posterity, do ordain alld establisll tI.is of America. ·PREAMBLE TO THE U.S. r,._--~

ill order to forlll a 1II0re perfect

Mll§§iIO J ., §TAT!EMiE IT

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tile COlllll101I defense, promote tltegellera l Welfare, mrd seCll re tI,e alld ollr posterity, do ordaill alld establislr tlris COIIStitlltiOIl for tl,e

1'i"~.'~i:"J;AMtBLET'DTHEU.S. CONSTlTUTION ~,e People of tile United

The Foundation's

mission is to

\rJaperfe,ct Union, establish Justice,

;'Isure

domestic Tranquility,

increase flccess to prolllote tllegelleral Welfare, alld secllre tire Blessillgs of Liberty

justice by fonding

do ordain alld establisll tI,is Constitlltioll for tI,e Ullited States of

programs that target the civil legal

. CONSTITUTION

~re People of tile United States, ill order to

needs oflow-income establisll Jllstice, illsllre domestic Tra ll qllility, Provide for tire

Arkansans and by encouraging projects

Welfare, alld seClire tI,e Blessillgs of Liberty to ollrselves alld

that improve the

tI,is COIIStitlltiOIl for tire Ullited States of A lllerica. ·PREAMBLE

admin istration

tire People of tile Ullited States, in order to fonn a 1II0re perfect

ofj ustice. Grant priorities are,' ~.. For

dOlllestic Trallql/ility, Provide for tl,e

defellse,

alld secllre tl,e Blessings of Liberty to ollrselves and ollr

legaL aid

tI,is COIIStitl/tiOIl for tile Ullited States of Alllerica. -PREAMBLE

to the poor ~ . For

COIIIIIIOII

student Loans

tl,e People of tl,e Ullited States,

and schoLnrships or Other programs

for speciaL projects that improve the administration ofjustice

2005 Annual Report

tire tI,e

~==:::=:::~=~~United States of A merica. ·PREAMBLE TO THE U.S. CONSTITUTION


2005-2006 BOARD OF DIRECT ORS

2005 lFI

el

LlETTlER FROM TlHlE PRlE§llDlE JT

Nate Coulter VICE PRESIDENT Little Rock Anna Via SECRETARY Dardanelle James D. Gingerich TREASURER Conway DIR ECTORS Earnest E. Brown, Jr. Pine Bluff Richard C. Downing Little Rock Jim Jansen Pocahontas Louis B. (Buc ky) Jones, Jr. Fayetteville Freema n McKindra Little Rock James A. Ross Monticello Frank B. Sew all Little Rock M argaret M. Staub Helena

D E X lECUTllV lE DllRlECTOR Dear Colleagues, The Arkansas IOLTA program traces its existence to 1984 when it was created by a Per Curiam Order of the Arka nsas Supreme Court. Under Rule 1.15 of Arkansas' Rules of Professional Conduct, lawyers certify their compliance with proper trust account practices. This rule, which provides the guidelines for safekeeping the property of others, requires aU Arkansas lawyers who hold client trust ftmds that are short-term or nominal in nature to place these ftmds in pooled multi-client IOLTA accounts. The interest from IOLTA trust accounts is paid to the Foundation. The Foundation then awards grants from these funds to programs that provide civil legal representation to poor Arkansans and for projects that aid in the administration of justice. Historically low interest rates dramaticall y impacted the Foundation's revenue and 2005 grant awards were $251,250, down from $426,649 in 2004. The Foundation Board is hopeful that rates w ill continue to rise. In addition, over 240 Arkansas banks offer IOLTA accounts and most do so without charging fees. This enables the Foundation to maximize the amount of funds that are available for grants for law-related community activities. The Foundation sincerely appreciates this support from the Arkansas banking community. A Bank Honor Roll appears on the last page of this A.lU1Ual Report. We urge Arkansas lawyers to thank their Arkansas bankers for their support of the IOLTA program. We hope you will take a few minutes to review this report-especially the case vignettes that exemplify the good work done by Arkansas lawyers. We appreciate the positive response and leadership of the legal community in Arkansas. With the efforts of each of you, real people with real legal problems are able to access justice even though they are too poor to pay for civil legal services. The interest from your IOLTA account does make a difference daily in the lives of people who need legal help.

$486,813 1,866

IOlTA Accounts Interest earned on operating account Interest earned on unemployment account Interest earned on money market account Interest earned on C.D. 's Total Revenue for Period

6 1,91 7 2,053 $492,655

EXPENSES

$109,654 251,850 $361, 504

Administrative expenses Grant disbursements Total Expenses for Period

"Audit of the Foundation's books will be completed by the end of July. FnaI audited figures wiD be available from the

Foundation's office after July 15. 2006. If you would like a COPY. please call the Foundation office at (50 1) 682·9421. The

unaudited information presented above is based on the Treasurer's Report for January I to December 31, 2005.

GRANT DISTRIBUTION HISTORY • LEGAL AID

.

PAJ

• LEGAL ED

$900.000 $800.000 $700.000 $850.000 $600.000 $550.000 $500,000 $450.000 $400.000 $350,000

EX OFFICIO Don Hollingsworth Executive Director Arkansas Bar Association

FO R l TIO

INCOME

OFFICERS Larry E. Kircher PRESIDENT Bald Knob

L I

Larry E. Kircher President, 2005-2006

Susie Pointer Executive Director

$300.000 $250.000 $200.000

STAFF

$150.000

Susie Po inter Executive Direc tor

$100,000

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$50,000 $0 19891990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005


2005 ARKANSAS KOLTA GRANT RECKPKENTS LEGAL AKD TO TK-JIE POOR, 2005 HKGHLKGHTS CENTER FOR ARKANSAS LEGAL SERVICES (Center)

$140,750 Providing quality legal representation to low-income Arkansans in Arkansas, Ashley, Bradley, Calhoun, Chicot, Clark, Cleveland, Columbia, Conway, Crawford, Dallas, Desha, Drew, Faulkner, Franklin, Garland, Grant, Hempstead, Hot Spring, Howard, Jefferson, Johnson, LaFayette, Lincoln, Little River, Logan, Lonoke, Miller, Montgomery, Nevada, Ouachita, Perry, Pike, Polk, Pope, Prairie, Pulaski, Saline, Scott, Sebastian, Sevier, Union, White and Yell counties. -The Center continued to offer outreach activities to lowincome and elderly clients. Presentations were made in Arkansas, Crawford, Drew, Garland, Jefferson, Johnson, Pope, Pulaski , Sebastian, Union, and White Counties. -As part of the Arkansas Legal Services Partnership (ALSP), the Center's attorneys have created, edited or added over 400 documents for the use of Legal Services staff and pro bono attorneys. In addition, the Online Legal Library serves the Legal Services' clients and the public and may be accessed at www.arlegalservices.org Special sections were developed for 2005, including sections on Hurricane Katrina disaster relief information, legal glossary for non-lawyers, non-English resources and materials, and donations. -ALSP also developed wallet-sized cards listing the web address and brochures describing information available on the website. The Partnership also completed a mass mailing about the website to the pro bono community of lawyers and to 46 public libraries around the state that host Virtual Law Office sites. -The Center continued to operate the legal Helpline, providing low-income clients statewide with free legal advice and information. The statewide tollfree number is 1-800-9LAW-AID. Ms. Jean Turner Carter is Executive Director of the Center:

LEGAL AID of ARKANSAS (lAA) $93,750 Providing quality legal representation to low-income Arkansans in Baxter, Benton, Boone, Carroll, Clay, Cleburne, Craighead, Crittenden, Cross, Fulton, Greene, Independence, Izard, Jackson, Lawrence, Lee, Madison, Marion, Mississippi, Monroe, Newton, Phillips, Poinsett, Randolph, St. Francis, Searcy, Sharp, Stone, Van Buren, Washington, and Woodruff counties. - Lee Richardson became Director of Legal Aid of Arkansas after serving as Acting Director during most of 2005. He has

worked as an attorney fo r 17 years, with 15 years devoted to Legal Services. He supervised the program's legal work, made staffing decisions for cases accepted through the Helpline, and supervised the Managing Attorneys. He also handled some cases. -Rodney Chedister was a staff attorney in the Jonesboro office from July 2002 through November 2005. Prior to leaving he closed 112 cases, including 86 cases involving representation of victims of domestic violence. -William Everette joined the Helena office in September of 2004 and was Managing Attorney of that office during 2005. He has 20 years of experience as an attorney in public service law including the U.S. Navy, social security, the Equal Employment Opportunity Commission, and veterans affairs. -Barbara Griffin was the Managing Attorney for the Newport office of LAA. She also served as District Judge in Newport, working four days per week for LAA. Ms. Griffin continued to specialize in housing cases including federally subsidized housing authorities. -Farhan Khan joined LAA in February in the West Mempis office. He worked as a Staff Attorney until he resigned in September. -Margaret Reger, Managing Attorney in the Harrison office for 20 years and with 30 years' legal experience, worked as a solo attorney in this five-county office. Her caseload included domestic violence, divorce and custody matters. The Administrative Office of the Courts certified her to handle dependency/neglect cases in juvenile court. -Sherri Stewart, Managing Attorney of the Mountain View office for 15 years, was also certified under AOe protocols to represent chi ldren and parents in juvenile court proceedings. She served as the area's Community Education Assistant, developing and delivering presentations on a variety of legal issues at outreach events. She writes a regular newspaper column on legal issues and information. -Ebony-Azizi Sylla, joined LAA in September as a Staff Attorney in the West Memphis office. A 2002 graduate of Boalt Hall School of Law at the University of California at Berkley, she is licensed in Arkansas, California, and Tennessee. She represents victims of domestic violence in Crittenden and Cross counties and in the Osceola District Court of MissiSSippi County. -Jeanette Whatley, Managing Attorney in the West Memphis office, also served as Director of LAA's Housing Unit. The Arkansas Department of Finance & Administration certified her to teach first-time homebuyers about homeowner issues such as closing, budgeting for maintenance and repairs, etc.

ARKANSAS VOLUNTEER LAWYERS FOR THE ELDERLY (AVlE) $4,750 AVLE is a joint venture of the Arkansas Bar Association, the states' two Legal Services programs, and the Department of Human Services, Division of Aging and Adult Services. AVLE staff works closely with the Legal Services programs and the Area Agencies on Aging to insure older Arkansans get the legal representation they need. -579 volunteer attorneys served on AVLE's panel in 2005. -Private attorney volunteers assisted AVLE staff with making presentations to senior citizen groups. -Mr. Jim O'Hern of Ft. Smith was selected as the AVLE Attorney of the Year. He donated 75.5 hours to the AVLE program for the year. -Thirty-four (34) attorneys who donated 20 hours or more to the program were considered for the award received by Mr. O'Hern. -AVLE sponsored the annual dessert after hours reception at the Arkansas Bar Association meeting in Hot Springs. The dessert and coffee reception honors all active AVLE attorneys. Ms. Catherine Edwards is Director of AVLE.

EQUAL ACCESS TO JUSTICE PRO BONO PANEL (EAJP/LAA) $4,750 -Volunteers on the EAJP panel handled cases involving adoption, deceptive trade practices, protective orders, debt collection, guardianships, divorces, Medicaid and nursing home issues, property matters, Social Security, and wills. -Presentations were made to to community groups by EAJP staff and volunteer attorneys on Preparing a Will, What I Need to Do to Pass My Property to My Heirs, Housing Counseling, Medicaid Prescription Drug Coverage, LAA Delta Reconfiguration and Black Land Loss, and the services provided by Legal Aid of Arkansas and its Pro Bono Panel. -Mr. Don Kendall of Benton County received the Outstanding Service Award for volunteering over 50 hours of pro bono legal services to the citizens of Benton County. -A direct mail campaign soliciting donations from private attorneys in the LAA service area was conducted in November and December. The campaign resulted in $9,345 in unrestricted funds for LAA. -The EAJP and the Washington County Bar Association continued to send two volunteer attorneys each month to the Fayetteville Adult Education Center to assist adults in the literacy program with their legal problems and questions. -The Arkansas Pro Bono Partnership-consisting of

Mr: Lee Richardson is Executive Director of Legal Aid of Arkansas.

Volunteer Attorneys Assist Clients HFor The Good"

~ "*A1rs. Mullens contacted the Center for Arkansas Legal Services needing legal assistance to obtain the deed to a home she had purchased. The seller refused to release the deed because he said she still owed him money. The contract stated a purchase price of$12,000 with a $625 down payment and monthly payments of$250 for three (3) years with no accruing interest. *Mrs. Mullens had proof ofevery payment she made by cancelled check. *Mrs. Mullens wrote the seller a letter stating that her balance was $446 In response to her letter, the seller called her and said he agreed with her and was going to fix some items that she had requested to be repaired Even though the seller never did malce the repairs, *M rs. Mullens paid him the final payment. After the final payment was made, the seller stated that our client still owed him money and refused to provide her with a deed. The case was refirred to a private volunteer attorney. After many hours of negotiation, the pro bono attorney was successful in reaching a settlement without litigation and *Mrs. Mullens received the deed to her horne. "

-Between October 1 st and December 31 st more than 70 new members were recruited for VOCALS and over $160,000 was received in contributions for the VOCALS campaign. The program's administrators were Ms. Patricia Young, Pro Bono Coordinator, Little Rock and Ms. Shannon Eversole, VAP Pro Bono Coordinator:

"*Mrs. Ryburn, a 71-year-old woman, was placed in a Benton County nursing home following II sel"ies ofstrolees. Her son, who lives in New l'dexico, was named her guardian in 1!J!J!J. *Mrs. Ryburn's daughter wished to have her moved to a nursing 170me in Tulsa, Olelahoma, becau.se that is where the majority of the famifJ resides; howevel; the guardian bloclud all efforts to relocate *M rs. Ryburn. Legal Aid ofArkansas met with *Mrs. Ryburn as well as her ombudsman and the social worleer at the nursing home and ascertained that the client was in her sound mind and that it was, indeed, her wish to return to Oklahoma. A hearing was held, and the Judge agreed that *Mrs. Ryburn was competent to make such a decision for herself She has since moved to a nursing home in Tulsa, and Legal Aid ofArkansas referred her to the appropriate Legal Services program in Oklahoma to have the guardianship dissolved. "

:4 private volunteer attorney for Legal A id ofArkansas in Fulton County accepted the case of *Ms.

Henry, a terminally ill mother with two boys ages 13 and 18. The attorney prepared a trust, a warranty deed and bill ofsale, a will, and an Advanced Health Care Directive for *Mrs. Henry. The client reported back to Legal Aid about the kind treatment and excellent service she received. " ~ "*jlr1rs. Barnett, a 51-year-old woman, had been working since age 16, primarily as a nurse's aid and then as a certified nurse's assistant, both for nursing homes and private patients. However, du e to numerous medical problems, she could no longer work at her job. Her medical condition included diabetes, neuropathy, high blood pressure, arthritis, lung and chest pain, depression and anxiety, cataracts, and carpel tunnel syndrome. *Mrs. Barnett had applied for disability benefits six (6) times before contacting the Center /or Arkansas Legal Services for legal assistance. She had applied again and was waiting/or an Administrative Law Judge hearing to be scheduled The client's case was referred to a pro bono attorney for representation. The pro bono attorney prepared *1'vfrs. Barnett's medical evidence and was successfol in representing her at the hearing. *Mrs. Barnett was awarded and M edicaid benefits along with bade pa). "

s.s.r

~ :4 private volunteer attorney for Legal A id ofArleansas in Benton County accepted the case of *Mrs. Lightle, a 23-year-old woman whose husband was killed in combat in Iraq. The client and her husband had one child together; however, the United States Army would not fornish the child with benefits until a guardianship was established. In response to a client satisfaction survey, *Mrs. Lightle reported that the volunteer attorney had done an excellent job assisting her. "

~ "*Mrs. McKenzie contacted the Center for Arkansas Legal Services about getting help to care for her disabled sistel~ *Mrs. Robertson. *Mrs. Robertson, who was six months pregnant, suffered from drug induced schizophrenia and was unable to make decisions fo r herself She was in Little Rock at the State Hospital at the time *Mrs. McKenzie made contact with the Centel: A private volunteer attorney obtained a guardianship for the client. "

INl FIl.R'l ON I AWYFItS' TRUS r ACCOUNTS

Services meet the /egal needs of poor people in Pulaski County. Through a cooperative venture between eight central Arkansas bar associations, individual attorneys and the Center, over 840 volunteer lawyers now provide free legal assistance to poor people in the Center's 44-county service area. -Mr. Sam Hilburn and Mr. Christopher Barrier were named VOCALS Attorneys of the Year. -The Center continued its partnership with the UALR Bowen School of Law to recru it law students to help with pro bono work. Seven (7) law students volunteered on a regular basis to work on the Helpline, answering calls and interviewing clients. They also worked on legal education materials and created "Fact Sheets" on common legal problems. -The Arkansas Pro Bono Partnership-consisting of VOCALS, AVLE, VAP and the EAJP-met during the annual meeting of the Arkansas Bar Association. The Partnersh ip sponsored a joint recruitment booth at the Exhibit Hall of t he meeting, providing demonstrations for attorneys of the Online Legal Library, which is available to attorneys who volunteer to take pro bono cases.

"*Mrs. Madison, a victim ofdomestic violence, contacted the Center for A1'ieamas Legal Services. She had been married for 14 months. Two wee/?s after she told her husband that she was pregnant, he left her and moved in with a girlfriend. During their separation, *Mr. Madison obtained a $100, 000 life insurance policy on *Mrs. Madison . Husband and girlfriend then plotted to lei/I *Mrs. Madison, who was then five months pregnant. The husband and gir/ji"iend hired a man to murder *Mrs. Madison for $12, 000 ofthe life insu1"ance proceeds. Various methods for leilling her were considered, including sabotaging the client's car, shooting hel; 01" blowing up her car. The man hired to murder *Mrs. Madison and her unborn child ultimatefJ contacted the police and revealed the plot, which led to the arrest of *Mr. Madison and his gir/ji'iend After a two-day trial the jury deliberated onfJ 25 minutes before returning a guilty verdict against *Afr. Madison. He was sentenced to 25 years in prison. The Center filed a divorce action on the client's behalfshortly after the arrest ofher husband. *Mrs. Madison was awarded the divorce, permanent custody ofthe child, and a restraining order. "

:4 private volunteer attorney for Legal A id ofArl?ansas in Jackson County accep ted the case of

IOLTA

VOLUNTEERS' ORGANIZATION, CENTER FOR ARKANSAS lEGAL SERVICES (VOCALS) $7,250 VOCALS won the prestigious Harrison Tweed Award' in 1985. The program was started in 1982 by the Pulaski County Bar Association in an effort to help the Center for Arkansas Legal

Attorneys for the Legal Services programs in Ar'kamas handled the following cases in 2005. While the cases are rea£ the *names are fictitious to protect client identity.

*Mrs. Maris, who sought to divorce her husband H e had beaten her up and criminal charges had to be filed. At the time of application *Mrs. Maris' husband was continuing to threaten her. The attorney successfully obtained a divorce for *Mrs. Maris and the client reports that she got all ofwhat she wanted and that she was very satisfied with the way her case and legal option.f were explained to her. "

~

Ms. Susan Purtle served as Pro Bono Coordinator of the EAJP.

Legal Services Help People Who Need Help

The following legal matters were handled for free by attorneys in p rivate practice who volunteered their legal services to pro bono (meaning "for the good") programs in their communities. While the cases are real, the *names are fictitious to protect client identity. ~

VOCALS, AVLE, VAp, and the EAJP-accomplished several of its goals during this time. A list of pro bono lawyers was published in the Arkansas Lawyer, badges at the Annual Meeting of the Arkansas Bar Association identified pro bono lawyers, and prominent pro bono exhibit space was provided by the Bar for recruitment purposes.

"*Mr. and "Mrs. Womade took out a second mortgage to put siding on their home. Because ofserious medical problems, they were unable to keep up their payments. They were both in their late sixties with little flr7'nal education. *Mr. and *Mrs. Womacle were not aware that they had been served with a lawsuit by the holder ofthe second mortgage because they thought they had to be served in person by a deputy sheriff. Since they failed to respond to the lawsuit; a default judgment was entered against them and their property ws scheduled to be auctioned offon June 28th . A neighbor saw the foreclosure notice published in the local paper and told *M r. and *Mrs. Womack about it. The couple contacted the Center on June 15th, just twelve days before the foreclosure sale. A Chapter 13 bankruptcy case was filed on June 22, and theflrecl()sure sale was stopped. The banleruptcy gave the clients time to get their debts under contra! and save their home. " "*Mr. Conner, an 83-year-old Greene County man, required the services of an ambulance to transport him 27 miles to the hospital because his wife is legalfJ blind and his medical condition made him unable to sit upright. The client's HMO refused to pay for the ambulance because his situation was not considered life threatening. The emergency medical services provider billed *Mr: Conner for more than $1,200. Legal Aid ofArkansas assisted *Mr. Cormer with his appeal and was able to document that he had no othel" way to get to the hospital and that his medical condition would have become life threatening if he had not sought medical care. An Administrative Law Judge found in *M r. Conner's favor and ordaed Medicare to pay the bill. " "*Mrs. Frances, a mother with a teen-aged son, was employed as a nune'r aid and private sitter of the elderly. She was in1Jolved in a three-vehicle accident; and tf7e insunr ofone of the vehicles' demanded damages from 17er ofalmost $10,000. Because she was unin.sured, the Arkansas Safety Responsibility Section suspended her driver's license. *Mrs. Frances found herself with no running auto, no job, and no license to drive even a borrowed vehicle to loole for work The Center assisted her with bankruptcy, which discharged her debts, restored her d1-iver's License and gave her a fresh start. She was then abLe to find new employment. " "*Mrs. Rankin, a 65-year-old Mississippi County resident, wished to be considered as a relative placement for her grandson who was in foster care. However, she was informed by the Department ofHuman Services that she was listed on the child maltreatment registry for an investigation that had OCCUlTed 25 years previously *Mrs. Rankin denied that she was ever advised that a neglect complaint had been substantiated, and Legal Aid ofArkansas assisted her in requesting and holding an administrative agency hearing. The allegations were determined to be unfounded, and *Mrs. Ranlein's name was ,

l

"

l

ARKANSAS IOLTA FOUNDATION, INC. INTEREST ON L>\WYERS' TRUST ACCOUNTS

Justice Building, Ste. 0100 • 625 Marshall St. • Little Rock, AR 72201 • Office: (501) 682-9421 • Fax: (501) 682-9415 • E-mail: pointersusie@yahoo.com

IOLTA INTEREST ON LAWYEnS' IRUST ACCOUNTS


2005 [OlL1r

lBA K. lHlO JOR ROIUL

The Arkansas IOLTA Foundation gives special recognition and special thanks to the following financial institutions (or paying an average inleresl rale of 1.5 % or higher AND waiving service charges on attorney IOLTA accounls: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Arkansas Superior Federal Credit Union, Warren

Cleburne County Bank, Heber Springs

The Foundation apprecia tes and gives specia l thanks to the following financial institutions for paying interest of 1- 1.5 % AND waiving ser-

vice charges on attorney IO LTA accounls: _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __

Arkansas Diamond Bank, Glenwood Diamond State Bank, Hope First National Bank, Hot Springs Merchants & Farmers, Dumas Smackover State Bank Bank of Augusta Diamond State Bank, Nashville First National Bank of lawrence South8ank, Manila Bank of Holly Grove Farmers & Merchants Bank, StuHgart County, Walnut Ridge Bank of Paragould First National Bank, DeWitt Helena National Bank Bank of Star City First National Bank, Hope McGehee Bank A special lhank you to the following financial institutions (or paying interest AND waiving service charges on attorney IO l. TA accounts: _ Allied Bank, Mansfield American State Bank, Jonesboro American State Bank, Osceola American Slate Bank, Paragould

Arkansas National Bank, Bentonville Arvest Bank, FayeHevilie BancorpSoulh, Alma BancorpSouth, Camden BancorpSouth, EI Dorado BancorpSouth, Fort Smith BancorpSouth, Hope BancorpSouth, liHie Rock BancorpSouth, Magnolia BancorpSoulh, Melbourne BancorpSouth, StuHgart Bank of Arkansas, Tulsa, OK Bank of Cave City Bank of Dardanelle Bank of Deligh~ Nevada County Bank of England Bank of Eureka Springs Bank of Fayetteville Bank of Harrisburg Bank of lake Village Bank of liHle Rock Bank of Mountain View Bank of Pocahontas Bank of PrestoH Bank of Rogers Bank of Salem Bank of the Ozarks Bank ofTrumann Centennial Bank, Little Rock Century Bank, Texarkana Chamber< Bank of North Arkan..., FayeHevilie

Chart Bank, Perryville Citizens Bank, Batesville Citizens Bank & Trust, Van Buren Citizens State Bank, Bald Knob Commercial Bank & Trust, Monticello Commercial National Bank, Texarkana Community Bank of Cabot Community First Bank, Harrison Delta Trust, Hamburg Delta Trust & Bank, liHle Rock Eudora Bank Farmers Bank, Greenwood farmers Bank, Hamburg Farmers Bank & Trust, Blytheville Farmers Bank & Trust, Magnolia Fidelity National Bank, West Memph~ First Arkansas Bank & Trust, Jacksonville First Arkansas Valley Bank, Russellville First Bank of South Arkansas, Camden First Bank of the Delta, Helena First Comunity Bank, Batesville First Community Bank, Jonesboro First Community Bank, Pocahontas First Community Bank of Crawford County, Van Buren First Community Bank of Eastern Arkansas, Marion First Federal Bank of Arkansas, Harrison First Financial Bank, EI Dorado First National Bank, Ashdown First National Bank, Berryville Fir<t National Bank, Blytheville First National Bank, Crossett First National Bank, DeQueen First National Bank, Dierks First National Bank, Fort Smith

First National Bank, Marianna First National Bank, McGehee First National Bank, Mena First National Bank, Mount tda First National Bank, Min. Home First National Bank, Wynne First National Bank of Eastern Arkansas, Forrest City First National Bank of Green Forrest, Kingston First National Bank of lewisville First National Bank of Phillips County, Helena First Security Bank, Conway First Security Bank, Searcy First Security Bank of Clarksville First Service Bank, Clinton First State Bank, Conway First State Bank, CrosseH First State Bank of DeQueen First State Bank, Huntsville First State Bank, lonoke First Western Bank, Booneville First Western Bank, Rogers Firstar Bank, Morrilton Forrest City Bank Heartland Community Bank, Camden Heber Springs State Bank Heritage Bank, Jonesboro liberty Bank of Arkansas, Jonesboro Malvern National Bank Merchants & Planters, Newport Merchants & Planters Bank, Clarendon Metropolitan National Bank, liHle Rock National Bank of Arkansas, North little Rock

OneBank, little Rock Peoples Bank, Magnolia Petit lean State Bank Piggott State Bank Pine Bluff National Bank Portland Bank, Monticello Pulaski Bank & Trust, little Rock Regions Bank, Birmingham, Al Simmons First Bank, Dumas Simmons Bank, Hot Springs Simmons First Bank, lake Village Simmons First Bank, lincoln Simmons First Bank, Jonesboro Simmons First Bank, Searcy Simmons First Bank of EI Dorado Simmons First Bank of Northw.st Arkansas, Springdale Simmons First Bank of Russellville Simmons First National Bank, Pine Bluff Southern Bank of Commerce, Paragould Southern State Bank, Malvern Summit Bank, Malvern The Capital Bank, little Rock Twin City Bank, North little Rock Union Bank & Trust, Monticello Union Bank of Benton Union Bank of Mena United Bank, Springdale US Bank, Cincinnati, OH Warren Bank & Trust

Thank you 10 Ihese other participaling IO LTA banks for paying inleresl on attorney lO LTA accounls in 2005: _ _ _ _ _ _ _ _ __

Bank of America, SI. louis, MO Bank of McCrory Chambers Bank, Danville Cross County Bank, wynne

Elk Hom Bank & Trust, Arkadelphia First National Banking Company, Ash Flat First National Bank of Paris

First Security Bank of Mtn. Home Hibernia National Bank, New Orle>ns, LA SunTrust, Atlanta

This listing is based on interest rates on active at-torney IO t TA accounts as reported 10 the Foundation by individual banks in 2005.


Id eas are vu ln erab le, but protcctab le,

and

your

inrcl\ccw ai

MARK MURPHEY HENRY, J.D., LLM . Registered Patent Attorney MaSler of Laws in Agricultural Law

pro perry does n 't juSt protect itself. Th e anorneys at Il e nry Law Firm understand rhe necess ity of strong relat ionships with indu stry- leadin g

MICHAEL SEAN BRISTER, J.D., LLM . Maslel of laws In Agncultulallaw

sc ie lHis(s and othe r key professional s th at ca ll bring the aurhority and credib ility necessary

[Q

NATHAN PRICE CHANEY, J.D. Registered Patent AttOfney

es tabli sh th e critica l ev id e nce and protec t yo ur

va lu:able idc:ls. For more informat ion or

to

sc hedule a meeting. please ca ll

KAlEB KYLE HENN IGH, J.D., LLM . Master of laws In Agricultural Law

us at 479 695 1330, or visi t us online at www. hc nryiawfirm.nct,

STEPHEN CHARLES PARKER, JR., J.D. Attorney

H H EN R Y LA \V FIR 1\1 P OS T OF F I CE

nox

11 05

FAYETTEVILL E

AR

7270Z


ractice

(or Reminders) for Drafting the Divorce Decree By William G. Almand I have recently discove red [hat rhe reason I cannot remember all of the details of law praccice thar I used ro be able to remember is beca use of rhe vast quantiry of info rm ation I have accumu lated over rhe years, rath er than th e accu mul atio n of the years. After all , we all seem ro get busier by the mlllurc.

This latcsr exa mpl e of absence of recaJi ca me when I forgot ro remind opposing coun sel that she had left a few items ou r of rh e decree she had drafted. Th e recall came when the judge - properly - kicked back the un co ntes ted decree (yes, judges do read those things), We had forgotten to dea1 with the co ntes t of divo rce that necessarily co mes with dlC filin g of an Answer [a a Divorce Com plai nr. This article is imcnded ro serve as a reminder of those few things that we tend to ove rlook in busy times, or with the passage of tim e and rhe infreq uency of the occasio nal venrure inro domestic practice. we've just forgorren . 1. Unco nres ring the Co nrested Divorce. In drafting th e setrlement decree. the parry who is nor taking (h e divorce IllUS( withdraw the co ntest to the divorce and waive corroboration of grounds in o rd er to have a techn ically sustainable d ecree. The process of "uncontesting" is accomp lished by eim er filin g a pleading ca ll ed Withdrawl of Conrest in which I usually sta te that m e answer is withdraw n. the contest is wimdrawn (ki nd of like sell, convey and transfer) and co rroborat io n of gro unds is waived so that rhe marrer may be presented to the judge at any time witho ut funh er notice (to the party who is waiving his/ her co m est). 2. Security issues in decrees. Removing the requirement that parr ies pur thei r social security numb ers on the Do m est ic 28 TIl e ArbnsJs l~I\'Ycr

www.arkbar.com

Coversheet was an extremely imponant first step in makin g sure that public documents like divorce decrees cease bei ng a fenile gro und for idenrity theft. If yo u sti ll make it a practice of identifying debt responsibili ties by putting credit card numbers in property sen leme nr ag reements (U PSA") please STO P! Do not make it easy for idemi ty thi eves ro stea l acco unt numbers fo r banks, cred it cards, IRA's, erc. from yo ur divorce decrees. If you must put numbers anywhere, create a separate document, such as a len er agree ment sign ed by th e parries and referenced in the PSA or decree as the instrument co ntai ning the identifying in formatio n on acco unts whicb rhe panies are res po nsible. but whi ch is not included in the PSA or dec ree for reasons of personal securi ty for the panies. The decree can reference the "Sears Card # 1, MB A # 16, etc. and those refere nces ca n tie back to the pr iva te lene r agreement co ntai ning acco um idemifiotion and balances. 3. Securing the Paymem for Secured Propeny for a Non- Possesso ry Owner. How many tim es has a party agreed to take property upon wh ich bo th husband and wife are d ebto rs. promise to pay, indemn ify and hold harmless, th e non-possessory parry transfe rs tide. by deed. ass ignmenr or otherw ise. and the possessory party defaults, on ly to have the secured creditor come after the non-possessory. non-owner. co-d ebtor? One solurion is to allow the o ther party [Q remain owner until th e debt is paid or security inrerest is released. Sample language, that also gives rhe right of self-help repossessio n is below: Wife shall be entitled to possession of the 200_ (ve hicl e) . \'qhereas the vehicle is finan ced with

and said account is in both panies name, the parties shall own the vehicl e as tenants- inco mmo n 1IIHii Husband pays sa id accoum in fu ll . Husband shall then execute all necessary documems to affect a ride transfer, within five d ays of receipt of said documelHs of title. \Vi[c ~ lt aH pay all payments o n said note owed o n sa id vehicle in a timely manner until sa id notc is paid in full. W ife agrees to maintain the vehicle in good working o rd er and repair and to maintain insurance o n sa id vehicl e. Shou ld th e vehicle beco me damaged beyo nd repair, the parries agree thar any insurance proceeds will be applied first to any ind ebtedness owed on said vehicle and the remainder of the fu nds shall be used by Wife as he d es ires. The panics agree that shou ld Wife default on said payments, Husba nd shall be entitled to immed iate possess io n of sa id vehicle, and shall be enricl ed to sa le ow nership o f the vehicl e unless W ife cures sa id default wi,hin 'h irty (30) days of Husba nd 's taking possessio n. 4. A provisio n many people forget to in cl ud e in th e decree is the ad mo nitio n concernin g fa ilure to pay child suppon, and the potenri al for termination of parental righ ts in the event of se rious non -support. A sample provisio n is set fonh as follows: Pursuant to Ark. Code Ann. ยง9-9-220(c), [ AME OF NON-CUSTODIAL PARENTI IS H EREBY NOTI FI ED THAT FAILURE TO PAY C HILD SU PPORT OR TO V ISIT THE CH ILD FOR AT LEAST ONE (I) YEAR SHALL PROV I DE THE CUSTOD IAL PARENT W ITH T H E RI GHTTO IN IT IATE PROCEED INGS TO TERMINATE THE PARENTA L RIGHTS OF THE NON

See Practice Tips continu ed on page 47


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Arkansas Supcmc Court Historic;]1 Socicry

Noteworthy Arkansas Jurists: Justice George Rose Smith By Patsy Bailin

At his retirement ceremony in 1986, Justice George Rose Smith co ncluded his career by saying, "So I will Ict those be my final wo rds: H ave faith in efFo rr. " When co nsidering the declicarjoll with which he endowed his exceptio nal professional career, one realizes that Justice George Rose Smith nor only practiced what he preached. bur should be recognized as the archetype of his

exa mple. The efron and carc with which Justice Smith wo rked and lived provides an hono rabl e exa mpl e for all to foll ow, and the respect, app rec iation, an d gra titude so many felt for him can on ly leave one with a sense of the highest admira tio n. One may also say that th ese adm irabl e characteri st ics were appa rent from th e beginning. Justi ce George Rose Smith was born in 19 11 in Little Rock, Arkansas, into a large and disti nguished family whu!it: lim:: had already produced {'\vo renowned lawyers and several other notable relation s. including U .S. Arrorney General U.M Rose. He graduated first in hi s class at both Litcle Rock High School (now Linle Rock Ce ntral High School), and his law school, the University of Arkansas School of Law in Fayetteville. from which he received his law degree in 1933. Upon graduation he joined his uncle, George B. Rose, at his law firm of Rose, H emingway, Cantrell and Loughborough (a.k.a. the Rose L1.w Fi rm) in Little Rock where. bur for three and a half years of milirary se rvice, he worked unril his election (0 the Arka nsas Sup reme Court in 1948. A shy, reserved man, George Rose Smith preferred the role of indispensable researcher and brief writer to that of trial Ia\vye r, and his uncanny ability to remember and synthesize great volumes of information played 30 TIle Arkans(Js L(J\\)fcr

www.arkbar.com

no small part in making him a key member of the fi rm . It likewise made him well suited to the role he undertook as the protecto r of the right thro ugh intellectual honesty. When he won a sea r on the Arkansas Supreme Cou rt. thanks ro the suppo rt of ad miring lawye rs across the stare and the energetic campaigning of hi s most charming wife, Peg Newro n, Justice Smith became its IllOs{ junior member ar rhe age of thirtyseve n (ironi cally, he left as irs most senio r, at the age of seventy-five). He was sworn in 0 11 January I , 1949, and settl ed easily inro th e routin e he maimained throughout his thirry-eight years on the bench - a routin e ma rked by efficiency. orderliness. and pun ctuality. H e prided himself on his so und judgment, his thorough prepa ration , his jud icial integrity, and his consistent ab ili ty 10 write till;: ~ h u n cst opinions on [he Court. Over the co urse of his career, Justice Smith penned more than 2,000 op in ions. distinctive for th eir succinct and si mpl e language. He also wrote a number of law review arti cles, and twO books on Arka nsas law. Thanks to his imelligence and clarity of tho ught and language, his inAuence on the law of Arka nsas has bee n a lasting one. His reputation as an appellate jurist has brought Arkansas natio nal prestige. Whi le his achievemenrs in the areas of law and justice are exrrao rdinary. it is Justice George Rose Smith's mo re persona l qualities that are poss ibly his most striking. H e had an unusually wide variety of hobbies ranging from carpentry to word games. As his fr iend and fellow Rose Law Firm partner Phillip Carroll sa id â&#x20AC;˘â&#x20AC;˘, He was the kind of man who could pick up anything and do it well. " Justice Sm ith enjoyed creating his own crossword puzzles, approx imately fifty of

wh ich were published during th e last twenty yea rs of hi s life. His dry hu mor, graciousness, and love of words are wa rmly remembered, especially in {'\yo Apri l Fool's jokes. two opinions (h at managed to slip into th e Arkansas Law Review. Poisson v. d'Avri~ 22 A rk Lmu Review 74 1 (1969), Jusrice Smith's ow n favorite, had the Supreme Cou rt autho ritatively declar ing that the Arkansas Legislature had repealed every starure on cl1e books before 194 5! To be on Jusrice George Rose Smith's Christmas card list was to be in his inn er circle of fri ends, and therefore to enjoy the elaborate and hilarious ho liday scenes Justice Sm ith contrived to photograph the raccoo ns he fed in rhe ravine behind th ei r house. "Those Christ mas cards he lIsed to make. All of us wou ld wonder what he'd come lip with next!" remembered Carroll fondly. As Justice Darrell Hi ckman said ae Justice Smith' s retirement ce remon y, "The people of Arkansas d eserve this kind of public servam and for once got o ne in Uustice George Rose Smith]." Justi ce Sm ith served the Arkansas public with dedication, f.:1irness, intelli gence and the finest of work ethics until his death on October 20, 1992.

Patsy Bailin is the d,wghter of Rose Law Firm partner. Amy Let' Stewart and Arkansas artist David Bailin. She is in her first year al Wellesley College. in Massachusetts.


CLE CLE CLE CLE CLE CLE CLE CLE

,

,

Spring 2006 CLE Calendar M ay 1 LAw D AY ETHICS

Cathed ra l of St. Andrew Litde Rock. AR M ay 12 SOCIAL SECURITY LAw

Fayettev ille. AR

June 7- 10 ARKANSAS B AR AssOCIATION

I

J OICIAL CoUNCIL M EETING J OINT ANNUAL MEETING

Arlingto n H otel. Ho t Springs. AR Jun e 23 BESTOP e LE Fayettev ille. AR June 26-30 BEST OF CLE UALR Bowen SdlOOI of Law Lirde Rock. AR

For more information, contact Karen Hutchins or Virginia Hardgrave, Arkansas Bae Association, 800路609路5668, 501 -375-3957, ut in k at om or

vhardgraye@arkbar.com OR CHECK OUT TH E eLE PAGE at www.arkbar.com

Vol. 41 No. 21Spring 2006

TIle Arkansas La~er

31


A Special

Thank You to

2005-06 Sustaining Members Your Sustaining Member dues finance a variety ofprojects mId programs. This year, for instance, your support will sponsor two of the highlights at the Annual Meeting this June in Hot Springs. In the past, dues have made possible the printing of the Bar Leaders Handbook and a host of top-notch CLE presentations.

William L. (Bill) Adair

William H . Bowen

Roger U. Colben

Victor A. Flemi ng

Gene D. Adams, Jr. H . Wi ll iam Al len

D ebbie D. Branson

Par Jackso n Compton Barry E. Copli n Ben Core

Jim Par Flowers

Charles P. Allen

Ronald L. Boyer Roben B. Branch

Robert M. Ford Kay Wesr Forrest

Jusdn T. Allen

Ellen B. Brandey

Narc Cou lter

Lyle D. Foster

Mark H. AJlison

William C. Bridgforth Roben R. Briggs Fred E. Briner Bill W BristOw

Steve R. Crane

Timothy Davis Fox

William G. Almand Overro n S. Anderson

Philip S. Anderson R. Bruce Anderson Elizabeth Andreoli Richard L. Angel R. Keirh Arman Ben F. Arnold Jess L. Askew III Russel l C. Atchley Virginia Atkinson James R. Baber Kenneth B. Bairn Charl es W. 13aker Darryl E. Baker Charles A. Banks Barry D. Barber Harry F. Barnes Marcia Barnes W. Chrisropher Barrier Ben T. Barry Anthony W. Bartels Sherry I~ Bardey Woodson W Bassen III Fines F. Batchelor, Jr. David L. Beatry Paul B. Benham 111 Stephen Bennett Madeline L. Bennington Joe Benson M. Steph en Bingham Sam N. Bird Donald E. Bishop James B. Blair C. Tad Bohannon Ted Boswell

Edward W Brockman, J r.

Thomas E. Brown Mickey Buchanan William B. Buergler Randall S. Bueter Richard K. Burke L1rry W. Burks William Jackson Bun, 11 John Richard Byrd, Sr. Paul Byrd Julie M. Cabe Roben D. Cabe Andy L. Caldwell John C. Ca lhoun, Jr. George E. Campbel l Jerry L. Canfield T homas M. Ca rpenter Phillip Carroll Douglas M. Carson Daniel R. Caner Michelle H. Cauley Jerry \Y/. Cavaneau Robert M. Cearley. Jr. Earl Buddy Chadick Mark B. Chadick John S. Cherry, Jr. E. B. (Chip) Chi les IV Jona nn Coniglio Ch il es Larry E. Chisenhall. Jr. William M. Clark, Jr. H. Murray Claycomb John R. Clayro n Ralph M. Claar, Jr.

32 The Arkansas lal'Yer WWYV.arkbar.com

Michael A. Crockett

Price C. Gardner

James E. Crouch

David Allan Gates Charles Alan Gauld in Buck C. Gibson Pamela B. Gibson Sam E. Gibson Manin G. Gil bcn Melinda R. Gilberr W Dent Gitchel Roger A. G lasgow Charles W. Goldner, Jr. Don Goodner Ray A. Goodwin Robert J. Govar Angela B. Gray Keith L. Grayson Melanie L. Grayson Michael R. Greene John C. Gregg Ronald L. Griggs Timothy W. Grooms David F. Guthrie Michael E. Hale Barbara A. Halsey Donis B. Hami lron Frank S. Hamlin Stuart W. Hankins Regina Haralson W. David Hardin David M. Hargis Melva Harmon David K. Harp R. Victor Harper F. Daniel Harrelson James E. Harris Roger B. Harrod

Tim J. Cullen

Niki T. Cung F. Thomas Curry James D. Cypen Thomas A. Daily Carol C. Dalby Paul Danielson Boyce R, Davis John A. Uack) Davis III Steven B. Davis Roben T. Dawso n Barry Deacon J. c. Deacon Beth M. Deere Rebecca J. Denison Jack W. Dickerson Michelle Hargis Dill ard Darrell D. Dover Jam es F. Dowden Ted N. Drake Wa rren E. Dupwe Davis Dury Charles B. Dyer, Jr. B. Michael Easley David L. Eddy G. Thomas Eisele Byron M. Eiseman, Jr. Don R. Elliott. Jr. Geo rge D. Ell is Jeffrey Ell is Stephen Engstrom Audrey R. Evans John C. Everett Hugh A. Finkelstein


Charles L. H arwel l

William A. Martin

Neal R. Pendergraft

Joseph A. trode

John T Haskins Jason M. Hatfield

David R. Matthews

Edw:ud M. Penick

Gail Matthews

Richard F. Hatfield

Stephen A. Matthews

Mark Alan Peoples Donna C. Penus

John F. Stcoud, J'. William H. utton

William D. Haughr Brad L. Hendricks Rn~nna Henry Sam T. Heuer

Jo Ann C. Maxey Ronald A. May S. Hubert Mayes. Jr. Ma,k T. McCany

EJlis Lamar Pettus John V. Phelps Norwood Phillips Chris Piazza

Basil Hicks. Jr.

Hayes C. McClerkin

Mackie M. Pierce

Henry Hodges Tina M. Hodne

Ed W. McCo,kle

George N. Plastiras

Michael S. McCrary

Franklin A. PofT, Jr. David M. Powell

Denise R. H oggard

Bobby McDaniel

Curtis E. H ogue

Dustin B. McDaniel

William R. Holl and Cyril Hollingsworth

Ken D. Swindle Richard D. Taylor W. H . Taylor Mary Ellen Ternes RexM.Tony William L. Terry Floyd M. Thomas, Jr. Roben F. Thompson Danny Thrajlkill Cindy Thyer

James Bruce McMath Toney D. McMillan

Jerry D. Pruitt Donald C. Pullen Janet L. Pulliam

C. Bass Trumbo

Don Hollingsworth

Paul D. McNeill

John I. Purtle

W. Ga')' Holt

Jack A. McNul')'

F,.d S. U"",), James R. Van Dover Marc W. Van Pelt

Win A. Trafford

Robert M. H onea

Russ Meeks

Joseph H. Purvis Steven W. Quanlebaum

Ron A. Hope

Michael Mi llar

Richard L Ramsay

David B. Vandergriff

Grego,), M. Hopkins R. Howard Hopkins

Lance R. Miller

Brian H. Ratdiff

A. Glenn Vasser

Marie-B. Miller

Gordon S. Ramer, Jr.

John C. Wade

Robert E. Hornberger Karen K. Hurchins

Phillip J. Milligan

J. Thomas Ray

Wyman R. Wade. Jr.

Philip Miron

Chris R. Reed

Eddie H . WalkÂŤ, J'.

James W. Hyden

Chalk S. Mitchell

Robert J. Reynerson

Bill H . Walmsley

Annahclle C. Im ber

H . Maurice Mitchell Michael W. Mitchell

E1ton A. Rieves III Lewis E. Ritchey

G. C hristopher Walthall

Michael E. Irwin

Bill Walters

Margaret E. W. MoJleswn

Andree L. Roaf

John D. Warson

Ark Monroe:

William S. Robinson

Jarues M. Moody Harry Truman Moore

Charles B. Roscopf

Timothy F. Watson. Sr. Richard N. Watts

C harles D. Roscopf

Raymond Weber

Bmy J. Jewell Glenn W. Jones. Jr.

C harles A. Morgan

Kcnr J. Rubens

Chrismpher W. Morledge

John L. Rush

David J. Whi laker David H. Williams

Louis B. Jones. Jr.

W. Frank Modedge

J. Shephe<d Russell III

Roben Shepherd Jones

Stephen E. Morley

Donald S. Ryan

Richard A. Williams Roben H. Williams

Jim L. Ju li an Philip E. Kaplan

Kenneth R. Mourton

Do n M. Schn ippcr

W. Jackson W illiams, Jr.

Rosalind M. Mouser

John R. SCOtt

Katharine C. Wilson

Sean T Keith

William Kirby Mouser

Frank B. Sewall

Eugene Kelley W illiam H. Kennedy III

Anhur G. Murphey, Jr.

Deborah Sexton

Mike Wilson Ralph Edwin Wi lson

Ralph C. Murray

Denn is L. Shackleford

Robert M. Wi lson, Jr.

Judson C. Kidd Mike Kinard

Timothy J. Myers E. Sheffield Nelson

Stephen M. Sharum

William R. Wilson. J r.

J. L. Shave<, J,.

Jennifer Wi lson- Harvey

Fred Kirkpatrick

Charles R. Nesulid

W Brad Sherman

Teresa M. Wineland

Peler G. Klimpe Roben S. Laney

David Newbern

Will iam F. Sherman

George H . Niblock

Robert Shults

George R. Wise, Jr. W illiam R. Wisely

Raymond L. Niblock Wyck Nisbet, J ,.

Steven Taylor Shults

Carolyn B. Witherspoon

James Marlon Simpson. Jr.

Tom D. Womack

John T. Lavey Ike Mien Laws, Jr.

Dana Daniels Nixon

Ted C. Skokos

Rhonda K. Wood

R. Gary Nutter

Douglas O. Smith, J'.

Marsha C. Woodruff

Charles R. Ledbetter

Debby Thetfo,d Nye

James E. Smith, J'.

Joe D. Woodw.,d

Samuel E. Ledbetter

Bobby Lee Odom

John C. Lessel

Edw.,d T. Oglesby

James W. Smim Laura H. Smim

Susan Webber Wright

Randolph

. Jackson

Paul J. James W illiam O. James. Jr. Bradley D. Jesson

Stanley R. Langley Sam Laser

Robert R. Wrighl III

Robert O. Levi

Hugh R. Overholt

Roben D. Smith III

Truma n E. Yancey

AJice F. Lightle

Charles C. Owen

David Solomon

Ca')' E. Young

Stark Ligon

Charles R Padgham

J. William Spivey III

Damon Young

John G. Lile, III

Chris L. Palmer

Larry L. Spradlin

Robert E. Young

Chester

Nicholas H . Parron

Dennis Zolper

C laibourne W. Patty. Jr.

Jim Sprott Kimberly S. Steward

B. Jeffery Pener

Thomas S. Stone

. Lowe, Jr.

Edwin L. Lowther. Jr. D. Price Marshall, Jr.

Vol. 41 No. 2/Spring 2006

n,e Arkansas Lawyer

33


Come to the 10St a joint meeting of the Arkansas Bar Mark Your Calenda Arlington Hot Register Online

"LAWGHTER" IS THE BEST MEDICINE

Winning at Trial

"Good humor is a tonic for mind and body." Heed the advice of Sean Carter, Humorist-at-Law, syndicated columnist, author and much sought-after trainer as he outlines ways for you to deal with the demands of law practice and the never-ending battle to find the work-life balance.

As a litigator, trial and appellate judge, and the author of the acclaimed "How-to-Win" Trial Manual, Judge Ralph Adam Fine has analyzed a wide range of

courtroom techniques and has determined what works and what

does not. His program will outline deceptively simple tools that will help you get the results you want-WINNING. Little Rock Lawyer Larry Chisenhall, Jr., who recently attended a program featuring Judge Fine, says that路 His presentation on cross

examination of expert witnesses was probably the most instructive and insightful, not to mention entertaining, that I have ever attended. For the young lawyer, it is a 'must'. For the seasoned

practitioner, if for no other reason than curiosity, go see what you have been doing wrong for your entire career. "

Pick and Choose or Mix & Match as you customize programs best suited to your practice from among the more than 50 hours of CLE offered.

Relax and Enjoy golfing, lounging by the pool, networking with colleagues, visiting with judges and conducting business in a relaxed setting.

Make it a Family Affair Bring your children and your spouse to enjoy the many programs planned for them, 34 nle Arkansas la\-'1'cr

YVW'W.arkbar.com


1 Annual

Meeting

ssociation & Arkansas Judicial Council for June 7-10, 2006 !I, Hot Springs www.arkbar.com

Time Mastery for Lawyers and Judges In today's frantically paced

work environment even the most professional practitioner or judge can feel out of control drowning in a sea of paperwork and endless details. Frank Sanitate, the .. Master of Time Mastery, â&#x20AC;˘ can help you turn over a new leaf by showing you pradical ways to make your work more produdive and satisfying. Learn how to take charge of your work, your time, and your life with the practical tools and skills he offers. Program highlights include how to

Fraud & Consequences Everyone in Corporate America has the opportunity every day to commit fraud or to turn the other way. Jerome Mayne's

dynamic presentation includes his real life story as an entrepreneur who crossed the line. It explodes into a nightmare of FBI investigation, prison and his life as Federal Inmate Number 08657. This presentation w ill eliminate the" gray

area" that exists in teday's corporate culture.

plan and set priorities, eliminate anxiety and procrastination, control interruptions, and communicate effectively.

MERRYMAN Come to the meeting, make new friends, renew old acquaintances and participate in as many activities as you can fit into your busy schedules. We look forward to seeing you at the Annual Meeting. Jim Julian, Chair Annual Meeting

Witness an original play based on the Supreme Court Case of Ex Parte Merryman dealing with President Abraham Uncaln's decision to order the arrest of prosecessionist lawmakers in Maryland, his suspension of the Writ of Habeas Corpus and the outraged readion of United States Chief Justice Roger Brooke Taney (he of the infamous Dred Scatt decision.)

Vol. 41 No. 2/Spring 2006

TI1C Arkansas La'IYcr

35


Judicial AdvisolY Opinions Judicial Advisory Opinions are written and provided by the Judicial Discipline and Disability Commission. Full toct is availnbk online at www.state.ar.usljeac. index. html

Advisory Opinion 2006-01 February 16, 2006 The Arkansas Judicial Eth ics Advisory Commi[[ce issued an adviso ry opinion to Judge David Stewa rt of Littl e Rock, Arkansas. Judge Srewan requested an op inion as CO whether the Arkansas District Judges Council (ADJ c), a non-profit co rporati on, may make a di rect o r indi rect political co ntribution from its treasury to an in cum bent o r a Il on-incumbem cand idate co the Arkan sas legislacure. H e seated that rhe o perati onal funds fo r the Council are based o n annual dues of th e member district judges. H e also scated th at, in m ost instances, the dues are paid either direcdy o r indi rectly by rhe governmental enriry that employ th e judges. Th e Co mmit tee stared rh e Arka nsas Cod e o f Judi cial Co ndu ct in Ca no n 5A(I )(e) pro hibi ts a judge fro m maki ng a contribu tio n to a ca ndidate for office. Can on 5A(I )(b) li kewise bars a judge fro m publi cly endorsing or oppos ing a cand idate fo r poli tical office. Ir is the o pinio n of the Comm ince [hat m e po licy reasons that suppo rt these restrictio ns apply in like fas hi on [Q an o rga nizatio n of jud ges. Proh ibited co nduct can not be legitimatized by ind irect collective aC[iviry. The Co mm ittee co ncl uded th at th e ADJ C can nOt make direct or ind ireer political co nrri bueions co cand id ates to m e Arkansas legislatu re. Advisory Opinion No. 2005-08 January 27, 2006 The Arkansas Judi cial Ethi cs Advisory Commirree issued an advisory opinion to Ano rn ey Ray Spruell. a publicly ann ounced candid ate fo r circuit judge in the Seco nd Judicial D istri ct of Jo nesboro, Arkan sas. Attorn ey Spruell requested an opini on as to whem er a judi cial cand idate who is no t curren tly o n th e bench but has served as judge may refer to himsel f or herself as "j udge" in a campaign logo, o n signs, or in other campaign mate ri al. The Commi ttee noted that 36 TI1C Arkansas l m\j'cr

www.arkbar.com

Ca no n 5(3)(d)(iii) provides that a candidate fo r j udicial o ffice shall nOt "kn owingly m isrepresent the identi ty, quali ficatio ns, p resent pos itio n o r o rn er faC t concerning the cand idate o r an opponent." lr is the o pinio n of th e Co mmittee that Atto rney Spruell's use of the term "j udge" in his campaign material would m isrepresent his p reselH position and wo uld be in violation o f the Cod e o f Judicial Co ndu ct. D ecember 6, 2005 Advisory Opinjon No. 2005-06 Th e Arkansas Judicial Ethi cs Advisory Comm ittee issued an advisory opinion to Retired C ircui t Co un Judge Lawrence D awso n of Pin e Blu ff, Arka nsas. Judge Dawson reques ted an opinion as to wh ether placing a photo of himself, wearing a coun ro be, o n the jacket cover of the book he is writing entitl ed . "Fifty Yea rs as a Judge and CoulHing", wo uld be a violation of judicial eth ics. lr is the op ini on of the Co mmi ttee that placing the robed photograp h o n th e jacket cover of the book wo ul d not violate any provision o f the Code.

charitabl e o r edu ca ti o nal organizat io n, and m ay no t be the gues t of honor at th e organizatio n 's fund raisi ng evenÂŁ. H owever, the Co mm ittee fi nds noth ing in the Code thac bars a retired judge fro m being th e speaker or guest of honor at such an event. T he C ommi ttee also noted that the commentary to Cano n 4(C)(3) states th at a sitti ng judge may purchase tickets and attend such an event, but may no t be a speaker at the fundraising event. h is the o pin io n o f m e Committee th ar a sittin g judge m ay not be a ÂŤroaster" (guest of hon o r) at a fund raisin g eve nt. Th e Committee a150 concl udes th at it wo uld be imp ro per to include the nam es of sittin g circuit jud ges in the program . Such an indication wo uld lend the suppo rt o f th e judicial office to the fund raisin g activities of a private group.

Advisory Opinion 2005-07 December 6, 2005 T he Arkansas Judicial Ethics Advisory Co mmittee issued an advisory opinio n to C ircu it Co urt Judge David N. Laser of Jonesboro, Arkansas. Jud ge Laser requ ested an opin.i on as to whether it wo uld be permi ss ible fo r tri al cou n assistan ts (case coo rdin ators) to be involved in fundraising activiti es associated with an event ho no ring th eir empl oyer. a ci rcuit judge sd leduled to reti re in January of 2006. He stated that the jud icial o ffice will not be utilized in the pro motio n o f th e eve nt. Judge Lase r requested permission to use the ho nored judge's nam e in the p rogram , which wouJd be d isbursed prio r to the retirement of the ho nored judge. H e ruso requested an o pinio n o n whether el ected circuit judges may atte nd the event. T he Co mmi ttee stated that trial cou rt assistants for circuit judge sho uld take special preca utio ns to avoid any suggestio n th at the court o r co un officials are pro moting th e event. T he Com m ince noted that accord ing to Ca no n 4(C)(3) of the Arkansas Code of Jud icial Co nduct, a jud ge may not parti cipate in the fund raising activities of a

The Judicial Ethics Advisory Co mmi ttee has anno un ced

twO

(2) vacancies. O ne

three-year judicial vacancy will beco me ava ilab le o n July I , 2006. Th ere is also a second jud icial vacancy for the te rm that ends o n June 30 , 2007.

Details

co nce rnin g this co mmittee can be fo und at www.state.ar.us/ jeac o r in the sectio n of th e Co u rt Rul es vo lum e und er " Procedural Ru les fo r [h e Arkansas Jud icial Emi cs Ad visory Co mmittee." Anyone interested in servi ng on th is Co mmittee should send an email to jddc@arkansas.gov or a letter to the Judicial Ethics Ad visory Co mm ittee at 323 Center Street, Suite 1060, Littl e Rock, AR 7220 I , stating th eir ex perience by M ay 12, 2006.

Fo r further

info rm atio n, please cal l 50 1-682- 1050.


The Arb'l'"as: Bar A\~o<.:iation is proud to recognize the first rt.'<..:ipienrs of rhe LAWYER CoMMUNITY Ll'.GACY AWARD. ·Iwo award~ Me presClHed bi-annually by the Associarion to attornc}'~ andiudgt.'~ v.·ho have performed voluntecr public sCfvi<.:t.'s our of;l sense of duty. profes.sion.llism. and ;1 genuint.' desire ro give back to rhe communiry. Recipients wt.'rc selecred by rhe Puhlic Informarion Commicrcc afrt:r considering rhe nomino.1riom received by rhe deadline.

J.

c. OACK) DEACON

Jack Deacon's public .\ervice work spans as 111<111)' decades as his lengthy legal career, which is why it is 110 surprise that he i~ onl' of the firsr recipients of lhis award. However. it may be a surpri~l' to someone who reads hi.'.> extensive professional rc:~ume ,hat he found rhe rime to build ~mch an awe-inspiring li~1 of civil, religiom and non~pfofit work as well. Almo.'.>t six-decadc.'.> worth of Ic.:..uh:rship and accompli~hl11t.'lHs at the loca.l and stJte level have made hi~ name well-known in the public ser\'ice aft.'lla. Dcacon has served as presidelH of mosr of the major local livic organi.larrom a~ well as Ilumerous state organizations, including rhe Jonl·~boro Chamber of CommcrlC and Rotary Club. rhe Craighead County Red Cro~s. the Highway 63 Asso<.:iarion. rhe Advi~ory Board of St. Bernard.. Regional Mt:oical Center, and the Arkansas Amateur Arhlc{it.: Union. He hilS also served as director on nUll1erom boards at the state and local level. including the Arkama'l Communiry roundation, rhe Ark<lnsas Amateur Athleric Union. Jnd rhe Arkansa.s ConferelH."e of Christians and Jews. Perhaps one: of Deacon's proudeH accomplishments is his role .1S ,I founding board member of ,,,·hat i.s now the United \'(fay of Northeilsr Arkansas. His cOl1(inuing sl'rvice with the Uni[(;,d Way and nUlllerom other civic organi/...aiom exemplifies his love for his (ollll11uniry. As a long~time public servant. Deacon has enriched his own life ilS wdl as the lives of those in his communiry by ~ho\\'ing orher I.lwycrs how to reach our beyond rhe legal profession.

WIlliAM

c. (BilL) MANN

III

Bill Ma.nn is the lawyer that ocher lawyers a.~pife to be. He has .lchiewd the much ~oughr-ah.cr. dusivt: haL.lIKC in his roles as a lawyer. family l11an, .lnd public .'.>crvalH. He e\"Cn managt.'S 10 balance hi~ effortS in the public servin; "ren.l with <lCcompli.'.>hnll:m.'.> in four out of "ix of rhe nomination Gltegorics for I"hi~ 'l\v<lrd. The general public may nor have heard of Bill Mann. but .l Ia.rge number of childrcn. elderly. homdf.:~s. mentally disabled. and (){her pc..""(>plc in need know of rhe man thar has qUil·liy influenced their live". Mann serves on the UAMS P~y,hiatry Advisory Bo"rd .lnd ha~ served on rhe BOlrd of Directon; and as Chair of Arkansa..\ CARLS. When he is nor phl~·ing golf with friends or 'ipending rime with his fa.mily. hi~ wcekend~ are spell( .lS a volunreer for M1WArCH (l\linistries to Incarcerated Women and Their Children) and the Imerfaith Hospirality Nerwork_ Mann's 'itrong rairh keeps him actively involved with hi~ church, Pulaski Heigh(s Uniled Me[hodi~t. where he sefWS as a head usher, a mentor for youth, and teacher for adulr dls!>c.'.>. On top of meeting the numerous demands as chief deputy ciry i.ucorney for thc ciry of Unle Rock, Mann "Iso takes steps 10 further promote professionalism in gowrnmf.·ntal law, He was one of the first [wemy persons in rhe (()unrry to lll' recognized as a Fellow in LCk:a.1 Government La". ·, and he activd}· pJ.nicip3tt.~ in our ~oci<ltion's Mock Trial Comminee, Mann's dcdicatl'd, from~rhe­ hea.rt involveml:1lt makes him 3 leader in hi~ fidd-one who sets our to make a difference and actually accomplishl,\ rhar goal.

Any persoll 1II11Y 1I0minate a lmoyer or judge by completing tIJe Nominatioll Form and turning tIJe Fo,.,,, into tIJe A"kllllsns Bllr Association office 011 or before tIJe nomination dead/iul!. Nomi"atioll deadlines ",'e jnml/l1Y 31st and jllly 31st of ench year. Nominatioll /onus IIud guidelines for tIJe alVard are IIvnilnbk III 1V1V1V.nl'kbm:c011l or by eOPltactillg tIJe Association.

Vol 41 No. ].J ~pnng 2006 The Arkun,", I "")"er

37


La\-\0'e Disciplina~y Actions Final actions foam December 6, 2005, through March 10, 2006, by the Committee on Professional Conduct. Summllri~s P"pared by the Office of Proftssio"al Condllct. Full ttxt documents lire available on-line at http://courts.sttltc.llr.uslcottrtslcpc.lmnl.

DI SBARMENT, ROBERT PAUL NEWMAN, Bar No. 95050, of Rogers. Arkansas, was disbarred by the Supreme Courr by O pinio n and Order issued March 9. 2006, afrer his trial for his conduct in several mattcrs that involved a pancrn of misconduct involving client fee funds pocketed or hidden by Newman and not repon ed (0 or paid over [0 his law firm. His fi rm termin ated him when the misco nduct was discovered , and the firm reported him ro the Commince. Newman accepted a $500 fee from a cli ent (W), cashed the check. and d id nor repo rt receipt of the fee unril asked about it several months latcr by the firm . Newman accepted a panial fee payment of $2,500 on a $5,000 fee in a criminal case, reported the fu ll fee to the firm as $2,500, deposited the check in his personal accou m , and did not report receipt of the funds or turn them over to the firm until about seve n months later, JUSt as the firm learned from the cl ient (E) of the earlier payment. Newman was to make restitution payment of $ 1,500 to the victim auto dealer for a client (C) from funds provided by the client's moth er. Newman caused a firm trust check for $ 1,500 to be issued and delivered to the prosecutor's office. The check was rerurned to him with instructions that it be sent direcrly to the victim's attorney. For some reason Newman had the $1,500 check canceled and two firm truS[ checks then issued , one for $ 1,000 sem to the victim's attorney and one for $500 payable to the client, which Newman cashed . (The special judge found no Rule violations in the matter involvi ng e, which rhe COUrt upheld based on a determination of witness credibility by th e judge. but th e

Court commented that Newman dearly engaged in qu est ionable behavior in (his marrer.) Newman accepted a check from a client's mother (8) for $2.600, deposited it in his personal account. and fai led to account to the client and mother for the full amount of the funds or (0 lise the funds fo r the purpose for wh ich the mother testified she sent the check. Newman represented M on traffic charges, and failed to deliver to the firm $450 found by the special judge to have bee n paid to him as a parti al fee by dle cl ient. The special judge found Newman engaged in, among other Rule violatio ns. criminal conduct (Rule 8A(b») and conduct involving dishonesty, fraud, deceit and misrepresentation (Rule 8.4(c». The Court held that, in spite of much evidence of his good character and work in the co mmunity, including favora ble testimony from twO local ci rcuit judges, Newman 's good deeds were dearly overshadowed by his consistent acts of serious misco nduct. Multipl e violations of Model Rules 1.3, 1.4(b), 1.1 5(a), 8.4(b) and 8.4«) were found. (A Petition for Rehearing or Explici t Ruling and a Motion for Stay of Mandate in O rder to Peti tion for Writ of Certiora ri were filed March 14 .)

SU RRENDER, W ILLIAM DAVID GO LDMAN, Bar No . 8 1074, of Hot Spri ngs. Arkansas, petitioned to surrender his law license in lieu of FUrther disciplinary proceedi ngs before the Comminee for "serious misco ndu ct." The Court accepted hi s surrender o n February 2. 2006. Mr. Goldman entered a guil ty plea to a fede ral misdemeanor charge and was sentenced to ten months in prison and a $306,454 restitution payment to a bank, arising from a matter involving his mi srepresentation to the bankruptcy court on a sub· stantial financial maner involving one of his former clients and a bank loan . H e also had pending Committee charges involving his trust account and fai lure to pay a $7,159.10 medical lien from 200 1 in a former client's case. Model Rules

Business Valuations Comprehensi ve T echnica l Exper tise in Business Valuations. Forensic Accounting, and Consultations for Trial Testimony Certified Ilublic Accountant (CPA), Master Certified Business Appraiser (MeRA). Accredited Senior Appraiser (ASA). Accredited in Business Valuations (ARV). Certified Fraud Examiner (Cf'E)

expert Witness Testimony Court-Appo inted

Schwartz & Assoc ia tes, CPAs I 15 10 Fairview Hoad. Suite 100 Littl e Hock, A R 722 12-2445 (501 ) 221-9900, (501 ) 221-9292 fax

email: schwa r tz@ busvalu.col11

It ichard L. S<:.hwartl.

38 TIle Arkansas

lm'Ycr

www.arkbar.com

1.1 5(a), 1.15(b), 8.4( b) in vo lved .

and orhers were

INTERIM SUS PE NSION, ZIMMERY C RUTC HER, JR., Bar No. 74029, of Little Rock, Arkansas, was pl aced on interim suspension on D ecember 9. 2005. pending fi ling of disbarmenr proceedin gs, based on a Com plainr fil ed by Dal nita Morriso n in Case No. 2005- 134. aJl eging violations of Model Rules 1.5(c), 1.1 5(a), 1.15(b), and 8.4(c). A Petition for Disbarment was filed as No. 05-1412 in the Arka nsas Supreme Court alleging, among other maners, that C ru tcher converted to his own use from his trust account $2,800 from the settlement he obta ined for Ms. Morrison.

SUSPENS ION, STE PHEN GREGORY HO UG H , Bar No. 84077, of Fort Smith , Arkansas, was sllspended for six (6) mo nths by Co mmi ttee Findings & Order fi led March 7, 2006, on a Complainr fil ed by Clara Ashburn in Case No. 2005- J J6. fo r violacion, of Model Rules 1.1 , 1.3, 1.4(a), 1.4(b), 8.4(c), a nd 8A(d). The suspension will run concurrent with the twelve ( J 2) monrh suspension in epe 2005- 11 8. Ms. Ashbu rn was injured on May 11, 2002. She hired the H ough firm (specificaJly his late brother and law partner. who died in January 2004) on her claim. Policy limi ts of $25.000 were offered by the tortfeaso r's carrier in a se ri es o f lette rs from June 2003 to August 2004. bur the offer was not com municated to Ashburn . She moved to Virginia. He r effo rts to obtain statUS information from H ough were unsuccessful. Ashburn and her husband were d ivorcing and husband 's attorney filed discovery for the accident claim information, which was not provided by Ho ugh, delaying the divo rce and causing Ashburn extra legal fees in the divorce case. Hough falsely told Ashburn and her Virgin ia divorce attorney he had filed the personal injury suit in Arkansas. but they could find no evidence of it in area courthouses. Ashburn secured another Arka nsas attorney for the personal injury claim , and her new counsel could not obtain information from H ough. H er new counsel filed suit May 10. 2005. to p rotect the claim . and settled the case on May 11 , 2005, fo r the 2003 offer. Hough clai med his late brother co mmunicated the $25,000 settlem enr offe r to As hburn and she reFII.soo ir. Hough disputed other claims by Ashburn . H ough claims he had a major breakdown in la te March 2005 and was incapable thereafter of dealing with his law practice. STEPH EN GREGORY HOUGH, Bar No. 84077. of Fo n Smith, Arkansas, was suspended for twelve (t 2) months and orde red to pay $2,500.00 restitution by Com mittee Findings &


.

Llwycr Disciplin;.try Actions O rder fi led M arch 7. 2006. on a Com plaint fi led by H arriet Lem hi in Case No. 2005- 118, for vioI.. io ns o rRules 1.1 , 1.3, 1.4(a), 1.1 5(.), 1.1 6(d), 3.4(c), 5.5(a), a nd 8.4(c). The suspension will run co ncurrent with the six (6) mo nth suspen sion in CPC 2005- 11 6. W he n M s. Lemhi's mothe r died in CaJ ifo rni a, Ms. Lemhi needed an Arkansas attorney to ha ndl e transfe r of tirle for Arka nsas la nds [0 va rio us ('rusts. Mr. Hough's lare brother a nd law partne r (who d ied in January 2004) had provided Lemhi 's famil y legaJ services fo r yea rs in Arkansas. Lemh i hired a "Mr. Hough" by telephone in early 2005 to provide the needed servi ces. He £old her ancill ary probate adminisrr:uio n was needed, alo ng with a survey which he would o bta in , and qumcd her a fee of

$2.500, which she sem by check on March 7, 200 5. Ho ugh had nor paid his 2005 law license fee and his license was in automatic sllspended sta tw as of M arch 2. 2005. The reafter Lembi and her Californi a an o rney had difficulty contacting Ho ugh and o btainin g informatio n about the man er. In late M arch o r ea rly April 200 5. Lembi learn ed Ho ugh had suffered a major perso nal incidem and was not (h en available. In late April 2005. Lembi co mmunicated to Ho ugh's office that if he did no t comac( her the next day she wou ld termi nate his se rvices. wh ich she d id when he d id not comact her. Lemb i demanded a refund of the $2.500 . She then comacted another Arkansas anorney, who hand led rhe matter by preparation o f a deed (for $ tO 1.66). Lembi obtained the survey herself and paid $225 fo r it. Lembi had no evide nce H o ugh performed any work for her no r has he returned her funds . H o ug h respo nded th ar during the time referred (0 in the complaim he was emotionally a nd physically unable to fu naio n, an d that he stOod ready to make full restitutio n, which had not occurred as or M arch 7, 2006.

her med ical bills taken care of in some fas hio n, with him to receive a fee of o ne-th ird of any recovery. She declined his offer and hi red anot her lawyer, who fil ed suit for Britt against Walker and Dunklin and o bta ined a default judgment o f $75,000 against them o n April 14, 200 5. (Case now on appeal [ 0 the Arkansas Supreme Coun .)

REPRIMAN D: R IC HA RD ATKl NSO N, Ba r No. 88066, o r Co nway, Arkan sas, was reprim anded by Co mminee Consem Fi nd ings and Order fil ed December 9, 2005, o n a Co mplainr filed by Ti mothy Awbrooks in Case No. 2005- 123. fo r violarions of M odel Rules 1.3, 1.4(a) and 8A(c). Mr. Ausbrooks hired Mr. Atkinso n in November 2003, 10 fil e a lawsuit for him agai nst th e bu ilder of his ho me. Mr. Atkinson agreed [Q do so and accepted the fee. Mr. Atkinson was not available to Mr. Ausbrooks o n many occasio ns when Mr. Ausbrooks wanted informati o n about his legal matte r. M r. Atkin son did no [ keep Mr. Ausbrooks ho nestly informed of the status o f his lega l matte r. Mr. Atkin so n advised Mr. Ausbrooks that a lawsuit had been fi led and that they were merely waiti ng on a trial dace to be set by the Court. In his C onsent to Discipline proposal, Mr. Atkinso n explained that he tho ught that was the status of the matter because he had

prepared a Complaint to be fil ed against the builder of M r. Awbrooks' ho me and d irected his stafT to fi le it . Mr. Ausbrooks learned later that no suit had ever been fi led . Mr. Atki nson later d iscovered this situatio n. wrote Ausbrooks about it. and returned the fee to Mr. Awbrooks. M IC HA EL D ENN IS BOO KER, Ba r No. 89053, of Little Rock. Arkansas, was reprim anded and o rdered [0 pay $4, 000 restitu tion , after a public hearing. by Committee Find ings & Order fi led December I . 200 5, o n a Complaint fi led by Li nda S. Hayes in Case No. 200 5-040, fo r violatio ns of Rules 1.2(a), 1,3, 1.4 (a), 1.4 (b), 8.4 (c), and BA(d). Ms. H ayes went to Mr. Booker for representatio n in a perso nal in ju ry claim . H e gOt her fil e fro m her first anorney in Augwt 2002, with abom rwe nry-o ne (21) months left on her statute of limitatio n. She thereafter had difficu lty com acting him and obtai ning info rmation about her legal matter. H ayes said that at all times Booker's office had her cell number and she kept his office updated on her address changes. H ayes fil ed a compla int with OPC in January 2004 . The statute of limitatio ns expi red on May 25. 2004. O PC comacred Booker by telepho ne first and then not la[er than November 15, 2004 , by letter abom the Hayes matter. Booker co nfi rmed H ayes was h is client. Booker contacted her on February 18, 2005, to set an appointment with her at his office o n February 24, 2005. At that

ELECTRICAL ACCIDENTS Paul D. Mixon, Ph.D ., P.E.

WOODSON D . WALKER. Bar No. 76 135, or Litde Rock, Arkansas, was suspended for three (3) years by Committee Findi ngs and Order fi led December 16,200 5. after a public hearing, o n a C omplaint fil ed by Reeshema Britt in Case No. 200 5-0 83. fo r violatio ns of Mod el Rules 1.4 (a), 1.4(b), 5.5(a), 8.4 (c) and 8. 4 (d). Mr. Walker's law lice nse had been suspended by the Comm ittee in April 2003. and he has nor petitioned fo r no r been re instated from tha t suspension . Ms. Britt was injured in a moto r vehicle inciden t on February 8, 200 I. She became the cl ient of M r. Walker a nd his fi rm of Walker & D unklin during August 2002. In Ju ne 2003. Walke r co nveyed to Britt a $5.500 serclement offer, wh ich she declin ed . Walker then wrote H ayes that he was turning the man er over (0 h is partner Dun kl in (0 ha ndle from there on. No acrion was taken a nd the S[3ture o f lim itations ran o n Brirr's claim . Brirr consuhed with another anorn ey in Apri l 2004. She was then :lble to meel wi th Wa lker in M:ly 2004, when he (old her he wo u ld try to get the earlie r o ffer reinstated and

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Lawyer Disciplin;'IIY Actions time Booker briefly encountered Hayes as he left "'for the airport," and ins tructed her to see his receptio nist, The receptionist gave Hayes his offi ce account check for $2,60 1.78 and a release, mat

included (he underlying liabili ry parry and Booker, (0 sign. TIl is am Ollnl equaled Hayes' mcdicals of $1 ,60 1.78 plus $ 1,000 for her orner claims, all of which Booker paid from his own fun ds.

ALV IN D . C LAY, Bar No. 96075, ofL;rde Rock, Arkansas. was reprim anded and fined $3,500.00, at a public hea ring. by Comminee Findings and

O rder fil ed February 27, 2006, on a Complai nt filed by August T homas in Case No. 2005-080. for violations o f Model Rul es 1.5(b), 1. J 5(3), I. I 6 (d), and 8.4(c). Mr. Thom a, h;red Mr. Clay in August 2002, for a $3.500 flat fee plus S200

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fo r filin g expenses, (0 prosecute a personaJ injury claim o f Tho mas's mino r son. No fee agreement exists. C lay hired Jackso n. an accidem recon· structio nist. and sent him Clay's $ 1.000 personal check. C lay received a $ 1,000 payment from Tho mas for Jackso n's services o n January 20. 2003. Jackso n claims C lay's check bounced and C lay fu il ed to make it good until April 200S. after th e Tho mas co mplaint was known to C lay to have bee n fil ed. Jackson rendered an un mvor· able oral repon (0 C lay and on January 29, 2003, scm C lay his billing for $823.75 and his refund check o f $ 176.25. lay claimed the refund as an additional fee and d id nOt tell Thomas of it o r credit it to Thomas. lay needed to take depos i. {ions and obwin ed $ 1,000 for this purpose from Thomas. O ne deposi tio n, costing $ 180.60 was actually taken. C lay retained the balance of 58 19.40 as an add itio nal fee and Failed to account to Thomas for it. C lay tried the case to a jury in October 2004 and los(. Thomas then ran a small "personaJs" section nOlice in [he state paper [hat was negati ve about Clay as a lawyer. On November 24, 2004, C lay sued Tho mas fo r defamati o n, and Th omas cO lllHercl aim ed . Th omas [hen fil ed his complaint at O Pe. C lay later dismissed his suit. C lay's lawyer se nt Jackson a check for $ 1.000 fo r his work in January 2003. when the C lay check had not been hon ored. Th e counterclaim was serried prior to trial. C lay did nOt deposit the two advance pay· ments from Thomas into a (ruS{ account. Z IMM ERY C RUT C H ER, JR., Bar No. 74029, of Linle Rock, Arkansas, was reprim anded . fin ed $ 1.500.00 and o rdered to pay $750.00 restitu· tion by Comminee Findings & Order fil ed ovember 28. 2005. o n a Complaint filed by T hermon Lee Bea rd in Case No. 200 5·096. fo r violatio ns of Model Rul es 1.3. I A(3). 1.16(d). 3A(c) and 8.4(c). Mr. Beard hired Mr. Crutcher to represent him in a matter involving his broth· er. H is brother and Beard had purchased proper· ry togcther and Beard later signcd a quitclaim deed to his broth er. Mr. Beard wished to have th e deed set aside and tide to [he property quieted ro him . Mr. C rutcher agreed to represent Mr. Beard . and quoted Mr. lka rd a fee of $750. which was paid in installments, with the final payment o n February 3, 2005. At th at tim e. Mr. C rutcher ad vised lilar he wo uld be filin g me Compl aint fo r Mr. Beard against his brother. He provid ed Mr. Bea rd with a copy o f the Compl aim that he said was being fil ed. but whi ch C rutcher did not fil e. No action had been fi led o n behalf o f Mr. Beud ~ of June 20. 200 5. Mr. Cru tcher did fil e a Co mplai nt fo r Mr. Beard approx imately o ne (I) week after he was served with th e formal disci plinary complaint in thi s man er. Mr. Crut cher advised th e Committee th at the reaso n he did not fil e the Complaint until Au gust 11 , 2005, was bec., use M r. Beard had not approved the co ntents of the pleadin g. Mr. Beard deni ed this and stated tha t he


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Lawye Disciplin;..IIY Actions approved if (h e day he made his final installment paymenr to Mr. Crm cher. In addi tio n, Mr. C rutcher was suspended from the practice of law for fai lure to pay his annual license fee on March 2, 2005. Mr. Crutcher adm itted that he did nor pay hili 2005 allllual licclIse fec umil August 10. 2005.

WILLIAM SCOTT DAVIDSON , B., No. 8 1044, of Jonesboro, Arkansas, was reprimanded and fined $ 1,000.00 by Co mm itrec Findings & Order fi led March 6, 2006, on a Com plaint filed by Mi lt Clegg in Case No. 2005-1 17, for violations of Model Rules L2(a), L3 , 1.4(a), 1.4{b), 1.1 5(a), 1.1 6(d), 3.4{e), 5.5{a), and 8.4{e). Mr. Clegg, a Mississippi business owner (EPSCO ), hired Mr. Davidson in November 2000 to pursue his claims against the Chavers (father and (wo sons) and their firm in Jonesboro. Respo ndent obtai ned a defauJr judgment for $ 18,269 against the father, and judgment, affirm ed on appeaJ in February 2003. against the sons fo r $80.360. Clegg asked Davidson ro pursue collection. C legg sem Respondent $500 in March 2003 ro pay fo r depositions. C legg and EPSCO then began ex peri encing diffi culty obtaining status reports from Davidso n. In February 2004. Davidson commun icated. a $25.000 settlement offer from the C havers' atto rney ro Clegg. C legg informed Davidson thar to properly evaluate th e offer he needed the information on the C havers' assets Davidson was to obtai n by depos ition. After many requests by EPSCO. Davidson finally rook the Chavers depositions in june 2004. C legg was not provided with the depositions and the reporrer was not paid her fee of $355.50. Clegg requested an accounti ng for the $500 bur received none. Clegg fi led his complaint with ope on Dece mber 2. 2004. orc: wro re Davidso n on December 31,2004. O n AprilS. 2005, EPSCO terminated Davidson's services, deman ded an accouming of the $500, and a refund of any unused balance. On Apri l 8. 2005, Davidso n provided ÂŁ PSCO 's new Arka nsas co unsel with copi es of the C havers depositio ns from june 2004. The reponer was paid by Davidson at the time he filed his response to the co mplaint , and he forwarded rhe balance of $108.66 to O PC for EPSCO on his office account check. Davidso n fa il ed to pay his 2003, 2004 and 2005 annual law license fee and was engaged in the unauthori7..ed practice of law during [hose years as a result. MARVA JOYCE DAVIS, Bar No. 83046, of Linl " ROl..k. A.kansas. was reprimanded by Committee Consent Findings & Order filed February 2 1. 2006, o n a Complainr fi led by Renee' C rater of MC H Physical Therapy Cli nic (MC H) in Case No. 2005-170. for violations of Model Rules LI, L2{a), 1.8(e), Ll5(a), Ll 5{b), and 8.4(c). Ms. Davis represented Phillips. Bryam, and twO Taylors in personal injury matters. All four were treated by and assigned pan of 42 TI1C Arkansas Lm\ycr

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their settlements to pay MCH directly. Davis also advanced or loa ned Ms. Taylor, her office employee at the time. $1,300 against her future settlement possibility. in violation of Rule I.B (e), and then collected her loan from Taylor's settlement. Davis settled the four claims, paid one Taylor account at MCH , and did not pay the other three, although she withheld funds for that purpose from rhe other three settlements. Ms. C rate r fo und out about rhe settlements in September 2004 and made demand fo r payment. then filed her complaint in mid-2005. OPC contacted Davis. who eventually paid all accounts. totaling $4.765.55, in fujI. Davis's trust accou nt balance fell as low as $99.66 in june 2005.

Hicks for his conduct in the appeal of Robert Mcintosh. whom Hicks had rep resented at trial. A timely Notice of Appeal was filed, but Mr. Hicks took no further actio n to pursue the appeal. Anorher atto rney filed an entry of appeara nce but also fail ed to file the record on appeal. Mr. Hi cks fail ed to seek permission to wi thdraw from represe ntation and th erefo re rema in ed responsible fo r th e appeal. The Supreme Co un appointed a Master ro co nduct a hearing abo U( the appeal. Despite having notice, Mr. Hicks failed (Q appear before th e Master. He fai led to pay his annual law license fee by the date due. as requi red by Arkansas Supreme Court Rule.

DAVID L DUNAGIN, Bar No. 84040, of Forr Smith . Arka nsas. was reprim anded by Committee Findings and Order fi led. February 28,2006, on a Per C uriam Order Compl aint in Case No. 2005- 102, for violations of Model Rul es 1.2{.), L3, 3.4{e) and 8.4{d). The Arkansas Supreme Court referred Mr. Dunagin to the Comm ittee based on his fa ilure to pursue an appeal on behalf of his diem. Sherry Childers, in a case where her parcnraJ rights had been terminated. Mr. Dunagin fai led to obtain a timely Orde r extending the time to file the appeal record. Because of this fa ilure, he did not seek to file the record. Mr. Dunagin made the decision [Q not file a Motion for Rule on the C lerk or Motion fo r Belated Appeal because he did not bel ieve the Court would gram either because the appeal did nOt involve a crimi nal matter. All of the information about Mr. Dunagin's conduct was reveaJed at th e hearing held by th e C ircuit Court on the issue of attorney error based on a referra1 by {he Arkansas Supreme Coun [Q conduct rhe hearin g. T he reco rd showed the Coun Reporter did nor deliver rhe reco rd (0 Mr. Dunagin umil one day after the deadline to file the record. Mr. Dunagin admined that he violated Model Rule 1.2(a) as he did not fi le rhe record on appeal within the ti me aJ lowed. Mr. Dunagin ad mitted thar he was in violarion of Model Rul es 1.3 and 3.4(c) in that he did not obtain an Order extending the time to file the reco rd on appeaJ because the Court Reporter told him that she would have the record to him and that she had never bee n late in her life tendering a record to an attOrney. Mr. Dunagin explained that he received the record that day after it was due. Mr. Dunagin also offered that he wou ld have filed a Motion for Rule on the C lerk if the Court was f.worab ly rul ing on such, which they were nor at the tim e involving Ms. C hilders' appeal.

STEPH EN GREGORY HOU GH, Sar No. 84077. of Fort Smith, Arkansas, was reprimanded by Com minee Find ings & Order filed March 7,2006, on a Per C uri am Order Co mplaint filed in Case No. 2005-1 10, fo r violations of Model Ru les I. I , 1.3, 3.4(e), 5.5{a), and 8.4(d). Mr. Hough rep resented the appellant in No. CACR 05-15 , Joel Mark Burroughs v. State. On March 3 1. 2005, Hough was granted a ti me extension for his bri ef but (hen failed to file one. The State fi led to dismiss, Mr. Hough did not file a response, and the motion was granted May It. 2005. Hough's 2005 law license fee was not paid until August 10, 2005 , so his law license was automatically adm inistratively suspe nded from March 2 - August 10,2005.

RICKEY H. HI C KS, Bar No. 89235, of Little Rock, Arkansas, was reprimanded and fined $500.00 by Committee Findings and Order filed January 25. 2006, on a Per Curiam Order Complaint in Case No. 2005- 10 I, fo r violations of violated Model Rules 1.2(a). 1.3, 3.4(c). and 8A(d). The Arka nsas Su preme Coun referred

STE PH EN GREGORY HOUG H , Bar No. 84077, of Fort Smith , Arkansas, was reprimanded and ordered to pay $425.00 restitution by Committee Findings & Order filed March 7. 2006, o n a Complaint fi led by Rosan na Hayward in Case No. 2005- 111 . for violations of Model Ru les 1.4 (a), 1.4{b), Ll6 (d), 3.4{e), 5.5{a), and 8.4(c). Ms. Hayward was sued for divorce and hired Hough on March 14, 2005. to represent her and pa id him $425 of his quoted $850 fee. Hough had not paid his 2005 law li cense fee and his li cense was auto matically ad ministratively suspended as of March 2, 2005. Hough failed to respond to her requests for informatio n about her case. On March 3 1, 2005. Mr. Hough suffered a major personal incid ent. Ms. Hayward read abou t ir in the paper and requested her fee back and a copy of her file so she could retai n another anorney. Hough failed to keep an appointment with her for that purpose. O n May 17,2005 , the court mai led a trial not ice fo r October IB, 2005, to Mr. Hough and opposi ng counsel. Hough never rerurned the confi rmation to the judge's office and did nor inform Ms. Hayward of her trial date. Hough respo nded that duri ng late March 2005 and thereaft er he was mentall y unabl e to deal with his practice. STEPHE N GREGORY H OUG H , Bar No. 84077, of Fon Smith , Arkansas. was reprimanded and ordered to pay $750.00 restirution by


L.lwycr Disciplin;Jry Actions Committee Findings & O rder fil ed March 7, 2006. o n a Complainr filed by Gary T. \X'illiams in Case No. 2005- 113, for vio lations of Model Rules 1.2(,), 1.3, 1.4(,), 1.4(b), 8.4(c), and 8.4(d). Mr. Williams was arrested o n multiple traffic charges in late 2003 and hired Mr. Hough. W illiams stares he and his witness were told by Hough that Wi lliam s co uld have a trial in DisHier Court o r entcr guil ry pleas th ere, appeal (0 C ircuit CO Llrt, and have a possible jury trial there. O n December 29. 2003. Hough and Williams appeared in District COUrt. guilty pleas were ente red through Mr. H ough. a nd W illiams thought he would be noti fi ed by Hough as to his C ircuit Court trial dare o n appeal. Hough fai led (0 file any notices of appeal. The District Court judgments becam e final. Williams was sropped several months later. told there were wa rratHs Out for him from these cases. and th:)[ he owed $2.625 in fin es and COStS on them. Wi ll iams called Hough on Feb ruary 24, 2004 , {Old him of m e si tuatio n. and Williams stated Hough (old him he wou ld take care of it, but nothing happened. In O ctober 2004, Wi lliams go t a lener from the police about the fin es, COStS and warrants. H e had to serve 59 days in jail in early 2005 ( 0 work off these penalties. W illi am s claimed he lost a job offer at th e POSt Offi ce due to this situation, and his auto insu ra nce rates have become unaffordable as a result. Hough responded that he d id not have access ro m e file in this matter, and he would have filed m e appeals to C ircu it Court if Wi lliams had insnuC(cd him to do so and had paid the fees and bond money requi red.

Orde r filed December 19, 2005, on a Complaint fil ed by Deborah H ope, in Case No. 2005- 11 9, for violations of Model Rules 1. 1 and 1.3. Hope hired Kelring- Beuch in June 2004, and paid her the $ 150 fi ling fee, to pursue a right-to-sue letter from EEOC in fed eral court against PAM Trucking, a publicly-held corporation headquartered in nonhwesr Arkansas. Hope was not informed if any federal suit was fil ed, Ketrin gBeuch's North Linle Rock office was closed in early 200 5, and Hope claimed she could nOt contact Respondent. Th e clerk's records show suit was acrually fil ed July 22, 2004. bur service was never obtained, even after a co un order ex tendin g rhe service time. and the case was d ismissed by the cou rt on January 25, 2005. Ketring-Beuch responded that she never could get a good service address, she co mmunicated approp riately with Hope, she (Ti ed to return her fi le bur mail to C was rerurned unclaimed, and Respondent otherwise acted appropriarely.

JOSEPH D. H UG H ES, B" No. 97021, of Parago u ld , Arkan sas, was re primand ed and ordered to pay $5.000.00 resritU(i on by Committee Co nsent Findings and O rder fi led February 21, 2006, on a Complaint filed by Doris A. Scon in Case No. 2005-129, for violations of Model Rules 1.1, 3.3(a)( I), 3.3(. )(4), 4. 1(a), 8.4(c), and 8.4(d). Doris Scott fil ed a grievance alleging she paid M r. Hughes a $5,000 retainer, thal he d id not handle her federal discrimination case aga inst the Unir.ed States Postal Service properly, and fh at he d id not tell her he was wi thd rawi ng from her appeal before m e Eighth Ci rcuit. H ughes filed an affidavit, signed by Ms. Scon and notarized , to his response 10 motio n fo r summary judgmenr. Ms. Scon denied the signature was mad e by her. Hughes admitted he signed her signature. Ms. SCO[( 'S case in the District Coun was dismi ssed o n Summary Judgment because she fa il ed to exhaust her admin istra tive remedi es . The Eighth C ircuit affirmed , after Hughes withdrew from her represem ation rwo weeks before her b rief was due and with telling her o f his actio n.

BARBARA A. KETR1NG -BEUC H , Bar No. 97074, of Hot Springs, Arkansas, was reprim:mded and ordered to pay $500. 00 resritU[ion by Comm inee Consenr Findings & Order filed February 10. 2006. on a Complaint filed by Dennis Fulmer, in Case No. 2005- 168, for violatio ns of Model Rules 1.1 , 1.3, and 8.4(d). Fulmer was terminated at wo rk and hired Respondent in September 2003 to file suit. He paid her a $1.500 retainer ro cove r furure costs and expe nses . The represenrarion was on a contingent fee basis, bu r Fulmer was provided no wrinen fee agreement by Respondent. Suit was filed in federaJ coun in O ctober 2003 and assigned an O ctOber 18, 2004, eri al date. The employer fil ed a morion for summary judgment in August 2004 and Respond ent fa iled to file a response. Summary judgment was granted September 13, 2004, and Respondent did not disclose this action to Fu lmer. The employer fi led a motion for com, Respondent fail ed ro respond , and judgment was entered agai nst Fulmer O ctober 19, 2004, for $1.141.70. Respondent did nor in fo rm Fulmer of this action. Pri or to Ocrober 18, Fulmer co ntacted Respondent abom the ui al dare and was rold rhe case had been passed for resening. He later independently learned of rhe su mmary judgment, was told by Respondent that hi s case was no t wo nh appeaJin g, he fired Res pond ent, and demanded a refund . Respondent se nt him a refund of $736.75 in January 2005. Respondent admitted violati ng Rules 1.1 , 1.3. and 8.4(d), and denied she failed to respond to requests for inform ation (1.4(aÂť, that she f."liled ro adequately explain matters to th e client ( 1.4(bÂť, and that she fal sely raid Fulmer in October 2004 rhal his trial had been reser (8.4(c)).

BARBARA A. KETRING- BEUCH, Bar No. 97074, of Hot Springs, Arkansas, was reprimanded by Committee Co nsent Findings and

CA ROLE DIANE SEXTON , Bot No. 92053, of Fo rt Smith , Arkansas. was re primand ed by Co mminee Findings and Order fil ed February

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Vol. 41 No. 2/Spring 2006 The Arkansas lal'Yer

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La\o\Ye Disciplin~lI)' Actions 10, 2006, on a Judicial Com plaint. in Case No. 2004·048, for violations of Model Rules 1.1, 1.4(b), 1.5(a), 1.7(a), 1.7(b), 3. 1, 3.4(c), 8.4(c), and 8.4(d). Bankruptcy Judge James Mixon filed a Judicia] Complaint against Ms. Sexton for her conduce in the proceeding sryled In Re: Stephen A. G riffin. The informacion se nt to the Commirtee contained an Order entered by judge Mixon with regard to Ms. Sexton and her conduct before Judge Mixon. Ms. Sex ton was found to nOt understa nd {'he basic princi ples of bankruptcy law during her represcnr:nion of her clients. She was Found [0 have not explained matters to her client, Mary McGehee, preventing Ms. McGehee from making informed decisions about the represc m3[io n by Ms. Sexton. Ms. SextOn was also found to have charged unreasonable fees to Ms. McGehee. Ms. Sexton attempted to represem more than one parey in imerest in the bankruptcy proceeding. Ms. Sexton also placed her own interescs and the imerescs of Barbara Griffin. another of her diems. ahead of those of her client. Mary McGehee. Ms. Sexton filed num erous pleadings that were found (O be frivolous and to have no basis in facr. Ms. Sex{On violated the Rules of the Bankruptcy Coun and also an Order of Judge Mixon during the course of her representation of Ms. McGehee. H ERB ERT C. SOUTHERN , Bar No. 99 105, of Fayerrevi lle. Arkansas. was reprimanded by Committee Consent Findings and Order fi led December 9,2005, on a Complaint filed by Ules E. H older, in Case No. 2005· 122, for violations of Model Ru les 1.2(a), 1.3, 1.4(a), I. I 5(a), and 1.15(b). While Mr. Southern was representing Holder in a bankruptcy maner, an issue arose concerning funds Mr. Holder owed to the Arkansas Oeparunenr of Finan ce and Administration (DFA). The funds were delivered to Mr. Southern by Mr. Holder for remirtance over to DFA. Mr. Southern did not place the funds in his IOLTA trust account, nor did he deliver the funds ro DFA. Mr. Southern stated that although he did nOI act'UaJly place the cash delivered {O him by Mr. Holder in the trust account, there were funds credited from other maners in his trusr account representi ng the funds of M r. Holder which were to be paid {O OFA. Mr. South ern also stated that he wrOte a check to DFA and sent it {O them and did nOt know lhat the funds had not been received by DFA . Mr. Southern did not refUrn telephone messages left by Mr. Holder for him. Mr. Holder sought the assistance of another anorney, who had fO sue Southern in order for (he: funds (0 be returned (Q Mr. Holder. It was only after Mr. Sourhern was se rved with the Complaint that he refU rned the fund s paid to him to Mr. Holder and also paid the ot her ano rney hired by Mr. Holder the COStS associated with filing the law. suir.

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MARK E. VELASQUEZ, Bar No. 98149, of Fayeneville, Arkansas, was reprimanded and fined $400 by Commincc Consent Findings and Order filed December 9, 2005, in Case No. 2005·127, for violations of Model Rules 1.8(e), 1. 15(30), and 1.15(d) on :t Complaim developed by rhe Office of Professional Conduct after receiving a trust account "overdraft" notice from his bank on February 22, 2005. The notice showed lhat his (rUSt check $33,008.00 to his el iem CK, in full settlement, was dishonored when presented 1'0 his bank for payment, as his truSt account balance was only $ 16,234.26 at rhe time. Mr. VelasqUC'l. received a wriuen request from OPC for an explanation for rhis "overd raft" si tuation . Thmugh exchanges of correspondence, e-mails, and documems, information was devel· oped thar CK was his client in a workers' com· pc:nsation claim that settled on February 9, 2005, for $40,000.00. H;s February-Apr;! 2005 bank statements did not refl ect the deposit of what would appear to be any CK senlemem check into his trUSt accoum. In a "senlement sheet" RA later reconstructed for OPC. he showed that. among other cha rges, he deducted $5,000.00 he had "advanced " C K on January 10, 2005. by his trust check, leaving her a net settlement of $33,008.00. Since there were no funds in his trust account on January 10, 2005, that belonged to C K, ro pay her $5.000 that meant he either converted $5 ,000.00 in funds belonging to another dient or used earned fees he had nor promptly removed from his trusr account as earned. He explained thal he also "most likely" deposited four "ea rned fees" totaling $15,827. 14 imo his trust account fmm February 1·11 . 2005. In a further explanation of the status of his over· drawn trust accoum. he showed the deposit into his trust accoum on or about February 14,2005, of a check from Franklin Templemn Investmems for $14,316.27, payable to his wife. which deposit was necessary to bring his account balance back to lhe level at which CK's check would be paid when presented again on February 16, 2005, accord ing ro his bank statement. RICHARD H . YOUNG , Bar No. 94149, of Russell ville, Arkansas. was reprimanded and fined $500.00 by Comm ittee Findings and Order fil ed January 13, 2006, on a Trust Accoum Complaint, in Case No. 2005- 131, for violations of Model Rules 1. 15(a) and 5.3(b). Young, a solo practitioner, permitted his non . lawyer wife to manage the firm trllst account. He did not prop· edy train and supervise his wife on trust account operations. She wrote trust checks for personal obligations. made deposics of non-client funds into the trust account, and overdrafts of the account were reported to OPC five times from August- November 2004. Young's law license was in suspended StatuS by Comminee action from March 30, 2004, to December 13, 2004. He responded that no client funds were improperly applied.

CAUT ION: M IC HAEL E. CRAWLEY, JR., Bar o. 97016, and GEORGE MI C HAEL DELOACHE, Bar No. 902 10, of Jon esboro, Arkansas. were cau(ioned by Commirree Consent F i ncling.~ & Order filed February 23, 2006, on a Complaint filed by Hugh Steimel in Case No. 2005· 153, for viola(;ons of Model Rules 7.3(b), 7.3(b)(4), 7 .3(b)(5), 7.3(b)(6), and 7.3(d). The attorneys SC nt a letter of solici tation to Teresa Steimel. Ms. Stei mel was nor lhe defe ndant in any coll ection proceed ing as alleged in their lener. She is not known to be in need of legal services in a particular matter. The advertising letter fai led to comain the phrase "Adverrisement" in all capi tal lett ers as req ui red by (he Model Rules. The le[(er failed to begin with the correct statement and fai led to co ntain the Statement in all capital letters about com · plaincs being sent ro the Comm ittee, as required by the Sup reme Coun's advertising rules. The lener failed to disclose how the anorneys obtained the information about the legal maner set out therein. The anorneys admitted that the adverti sing lener did not compl y with the requiremencs set forth by the Arkansas Sup reme Court . They explained lhat they failed to comply with the most recent additions to the Model Rul es. ROBERT NEAL JEFFREY, Bar No. 89110, of Camde n , Arkansas, was cautio ned by Commiucc Findings and Order filed December 28, 2005, on a Per Curiam Order Co mplaint filed in ase No. 2005· 136, for violations of Model Rules 1.3 and 8.4(d ). Mr. Jeffrey represented Kentrell Hill ar rrial, where he received a 135·year sentence, then filed a timely notice of appeal for Hill. An extension of time to file the record was requested and granted, with the Order filed settin g the time [0 September 14 ,2005. The maximum lime permitted by Sup reme Court Rule is seven (7) months from the date of the entry of judgmenr. In this case, the real last day to fi le the record was September I , 2005. Mr. Jeffrey tendered the record "late" o n Septem ber 8,2005. Mr. Jeffrey's motio n for rule on the clerk was gramoo and rhe appeal was allowed (0 pro· ceed. BARBARA A. KETRING- BEUCH , Bar No. 97074, of Hot Springs. Arkansas, was cautioned by Comminee Consent Findings and Order filed December 19, 2005, on a Complaint fi led by Pamela J. Austin in Case No. 2005- 112. for vio· lations of Rules 1.3, 3.4 (c). and S. S(a) . Respondent represented Pamela Austin in a child visitation matter in Faulkner Cou ney Ci rcuit COlirt in 2004·2005. In July 2004 Austin and Respondent participated in mediation. An order was generated at the mediation and signed by those present, to be signed by the Court, filed and distributed {Q the parries. Ms. Austin did nOt receive a file-marked copy and attem pted to co n·


Llwycr Disciplin;'lI)' Actions ract Respondent several times over the next few months 10 get a copy. The order was finaJly filed May 23, 2005, [he Office of Profess ional Conduct obrained a copy, and provided it to Ms. Austin. Respondent's Arkansas law li cense was in automatic suspended stants from March 2 - May 17.2005, due (Q her non-payment of her 2005 license fee by March 1, 2005. She prncticed Jaw in Arkansas. on the Pamela Austin Inaner and others, wh ile her license was in suspended Status.

BARBARA A. KETRJNG- BEUCH, Bar No. 97074, of Hm Springs. Arkansas. was cautioned and ordered [Q pay restiwtion in the amount of $200.00 by Comminee Consent Findings and Order filed December 19, 2005. on a Complaint filed by Luther Nelson of Chicago, in Case No. 2005-120, for violating Rule 1.4(a). Mr. Nelson hired Respondem and paid her $500 in January 2003 (0 transfer tide to Arkansas " heir" properry. with eighteen (18) heirs involved. Problems arose with circulation of the deed and it had to be sem around twice. The deed was apparently never comp leted. Nelso n dismissed Respondem in Seprember 2004, and requested a fee refund and return of documems he had provided Respondent. A second attorney was engaged to finish the job. Respondent sta ted she mailed everyth ing she had back to Nelson. accounted for the fee. he was not due a refund. and that ir was problems with names and addresses Nelson provided her that caused (he delay and problems with the deed. JOHN D. LIGHTFOOT, Bar No. 85089, of EI Dorado. Arkansas. was cautio ned and ordered ro pay $155.00 in resr i(Uti o n by Comminee Co nse nr Findings and Order fil ed January 30. 2006, on a Complaint filed by Billy Joe Miller in Case No. 2005-141. for violations of Model Rules 1.1 , 1.3 and BA(d). Mr. Miller was represented by Mr. Lightfoot in a bankruptcy matter in 2001 , and agai n in 2002. Mr. Lightfoot failed to be cenain that all creditors were listed on Mr. Miller's bankruptcy and was less than diligem in his representation of Mr. Miller. Bankruptcy Judge James Mixon pointed out several errors by Mr. Lightfoot anJ 1>t:Vc::ral ilistam. C::1> o flack of diligence in the represemation of Mr. Miller. Judge Mixon found that Mr. Lightfoot caused the Coun (0 expend judicia l time and eff"on which would nOt have been necessary but for Mr. Lightfoot 's lack of diligen ce. In 2002, when Mr. Miller's bankruptcy was required (0 be re-opened due to the failure to list aU creditors in the first filing, Mr. Lightfoot charged Mr. Miller an additional fee of $ 155. As parr of the consem to discipline. Mr. Lightfoot repaid that amOu nr lO Mr. Miller. Shortly after discharge in 2001, Mr. Miller began to experience difficulties wi th the c redilOr who had purchased a seulemem an nuiry which he had been receiving. Mr. Lightfoot advised Mr. Miller that th ey should fil e to reopen the bankruptcy and a MOl io n to Reopen was

filed by Mr. Lightfoot on March I. 2002. It was alleged by a creditor of Mr. Miller that Mr. Miller had perpetrated a fraud on the Coun because Scltl ement Capital Corpo ration had not been listed as a credimr in (he original bankruptcy. Mr. Lightfoot had been made aware of Settlement Capiul Corporation at the time, so Mt. Miller was no. sure why they were not lined on his bankruptcy. In Dece mber 2002. a hearing was held on the Motion to ReOpen before Judge Mixon. Mr. Lightfoot acknowledged that the fau lc in the maner was with him. He accepted responsibi liry for nor having all the information properly filled o ur in Mr. Miller's bankruptcy. Judge Mixon found that the minakes were Mr. Lightfoot's, not those of Mr. Miller.

CLARENCE PHIL SHOFFNER, Bar No. 76114 , of Searcy. Arkansas. was cautioned by Com mittee Findings and Order filed December 2B, 2005, on a Co mplaint filed by Roben Burns in Case No. 200S路 107. for violations of Model Rules 1.3, 8.4(c), and 8.4(d). Mr. Burns purchased properry from the Enace of David L. Cox, which was represtnted by Mr. Shoffner, who acted as the Settlement Agent at the sale of the properry. Despite accepting funds for the purchase of tide insurance, Mr. Shoffner failed m co mply with the requirements given m him by Jackson Counry Land Tide Services UCLTS). and no title insurance was secured for Mr. Burns. Mr. Shoffner included a copy of a canceled check m3de payable ro j CLTS d3led july 28, 2003, for tide insurance o n the properry, bur the check was not paid by Mr. Shoffner's bank until January 26, 2004. Mr. Shoffner also provided the Pand with a copy of a Quite Tide Action he had filed in June 2003 related {Q the properry purchased by Mr. Burns. Mr. Shoffner explained that his then secretary handled the closing in his office, he was not directly involved, so he was unaware of much of this matter. When Mr. Burns attempted to sell the properry later, he learned that he had no tide insurance on the properry and no clear tide. Mr. Burns attempted to co ntact Mr. Shoffner. Mr. Shoffner did nor rerum the telephon e calls. Mr. Burn s had oth ers arrempt to contact Mr. SholTner on his Ix:halfbur they were not successful either. Finally. Mr. Burns hired other counsel to assist him in obtaining clear title and handling of the matters which Mr. Shoffner failed {Q han dle. Mr. Burns paid $1768.56 to subsequent co unsel. Cynthia Nicholso n of Independence Counry Abstract Company ex plained that when co ntacted by Mr. Burns in January 2005, she lea rned that a ritle policy was never written on the properry purchased by Mr. Burns because the requirements in Schedule 8-1 of (he commitmenr were never mer. M s. Nicholson contacted Mr. Shoffner's office for Mr. Burns and explained th e problem to Mr. Shoffner's secretary. M r. Shoffn er did nor co nraer Ms. Nicholson despite the messages lefr by her for him . Despite the telephone calls from Mr. Burns and from Ms.

Nicholson. Mr. Shoffner advised the Panel that he was unaware thatJ LTS had nOt issued a final poli cy of tid e insurance until the filing of rhe disciplinary Complaint. Along with his response to the formal disciplinary co mplaint. Mr. Shoffner tendered for delivery to Mr. Burns a check in the amoul1l of $1.768.56 to reimburse him for the fees incurred in connection with the quiet ritl e acrion Mr. Burns initiated with mher counsel.

M. KEITH WREN, Bar No. 94 107, of Litde Rock, Arkansas, was ca utioned by Commi ttee Findings and Order fil ed January 4. 2006. on a Complaint fi led by Dr. Larry C. Horn , in Case No. 2005-125, for violations of Model Rules 1.15(h) and 3.4(c). Mr. Wren represented Joko Gaston and his two minor children in their personal injury claims that arose April 12.2003. The three were all treated by chiro practO r Horn (total bills $1,379.68), and Mr. Gasron was later {reated by chi ropracro r Eggleston (bi ll $693.00). There were other medical providers for all three Gastons. Most of the third parry providers (TP I禄 , including H orn and Eggleston, filed medical liens with the circuit clerk in early-tomid 2003. one of the lienors renewed or extended their liens after the first 1BO days. Wren wrote Dr. Horn on December 29 , 2004. and asked him to rake one-third reductions in all three Gaston bills to assist in Wren in reaching a senlemenr. Dr. Ho rn declined. Wren settled all Gaston claims on January 20, 200S, for a rotal of $10,000, paid Eggl eston , who accepted the reduction to $462, per Joko Gasron . and gave Gaston the funds that wou ld have gone to Dr. Horn, for Gasron ro pay Dr. Horn directly. Wren stated Gaston directed him not to pay Dr. Horn directly. that Gaston would rake care of it. In the process of settling, Wren filed petitions in coun for approval of the settlements for the twO Gasron minors and recired the Dr. Horn debts as to be paid by the father. The orders tracked the petitions. When Dr. Horn learned of rhe setdement payout. he communicated with Wren demanding payment. Wren told him that Dr. Horn did not have a valid lien ar settlemem date, that Wren obeyed his cl ient's instructions, and Dr. Horn was not paid. Dr. Horn fil ed (his co m plaint. Investigation revealed that other TPPs did nO{ have current valid liens and gOt paid by Wrcn. Wren knew of a dispute between Dr. Horn and Gaston over parr of rhe settlement and uni laterally arb itrated or settled a displlle between thcm as to those funds . Wren responded [hat he obeyed his client's valid irmructions and I'har Dr. Horn had no legal "i nterest" in the Casron funds si nce his lien was not va lid at setdement date.

Vol. 41 No. lISpring 2006 TI1C Arkansas Lawycr

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MOORE STEPHENS FROST

FINANCIA L GROUP

MOltl. TIIAN AN ACCOUNTING FIRM

msfros t .co m or 501.376.924 1


President's column, continued from page 5

nob le profess io n. In other words, our o utsta ndi ng members choose ro have an organizatio n that stri ves to make a difference in the lives of lawyers and society as a who le. N I mentio ned there are fi ve members of this team ro suppo rt each annu al leg of the endless relay fo r a Pres ident. T he o ther [wo members are the law fir m and fam ily of each Pres ident. T he leade rshi p pa th of o ur Associatio n requires not just o ne yea r, bur three yea rs of your tim e and energy. Thus, any member who accepts this responsibili ty mUSt share the sacrifice with his fa mily and hi s law fi rm. Certai nly, my year as President has been no exceptio n. My sin ce re grat itude is extended to the lawyers and staff of my law firm who have helped me "keep [he bal ls in the air" in my practice whil e I was attending to th e affa irs of th e Association. Additio nally, witho ut the sacrifices, support and comm itment of my wife, Judy, I would noc have been able to perfo rm my d uties as Preside nt. Of cou rse, the hallmark of any team is how well it ran the race. H ere is a pan of o ur track record for this Bar year: (I) The Lawye r Co mmunity Legacy Award was implemented ; (2) T he Case Summary research rool was crea ted; (3) The Jury Improvement Task Force wi ll be reco mmendin g legisla ti o n and ru les soo n; (4) Our Ca piral Campaign raised over $2. 1 mil lio n dollars fo r o ur new Bar Center; (5) T his Spring we will co mm ence construction o n o ur new Bar Center; (6) W ith the hel p of

the Professio nal ism Task Force we stud ied the issue of Pro fessio nal Liab ili ty Insura nce Discl os ure; (7) O ur Sustainin g Membe rship held steady while we engaged in an intensive Ca pital Ca mpaign; (8) We restructured o ur Com miss io n on Diversity and ini tiated new di vers ity programs; (9) We esta blished a Task Force to study the erosion of the attorney/cl ient privil ege; (1 0) T he Associatio n co ntri bu ted d isaster ass ista nce funds to the Mississi ppi Bar and Lo uisiana Bar; (11 ) O ur leadershi p attended Town Hall meetings with the Access to Justice Co mmi ss ion to explore mo re meaningful ways to prov ide legal services to [he needy; (12) O ur Mock Trial Co mmi ttee, chaired by Michelle Ca uley. had ano ther great year with the fi nals [ 0 appear on AETN; (13) T he Task Force to Study Rilles on Jud icial D isci pline and D isability, chaired by Bob Cearley, will propose new rules in [he Fall; and (14) O ur Edi torial Handbook Committee will co mplete th e new Debtor/Credi tor H and book and the revised Seni or Citizen H andbook. Obvio usly. space will no t permit me to continue, bu t clea rly our team had a fru itful year. From our yo uth to adul thood , we all remember va rious heroes at di fFe rem stages of o ur li ves. W hether it was span s. history, or our professio n we all fo und someone to admi re. Many believe we are witness ing the end of this hero worship as part of our western culture. H owever, most of us stil1 have heroes. They are JUSt nOt public figures. Many feel

that our selection of heroes, like the manner in whi ch we spend o ur mo ney, is reflect ive of who we are. It tells us somethin g about ourselves, and we need our heroes to exe mplify who we are and who we wish to be. Perh aps. Harri son Salisbu ry, author of "H eroes of My Ti me", captured my tru e sentiments. H e desc ribed heroes as ord inary people doing extrao rdinary deeds every day. It is in this vein that I characterize my new fo und heroes. For without the suppOrt of all fi ve members of thi s team, a Pres ident cannot successfull y co mpl ete his o r her leadershi p leg in th e endl ess rel ay fo r o ur Nsocia tio n. All of these team members share unselfishly to sacrifice fo r the benefit of o ur Associatio n and profession. T hey symbo lize what our great and noble professio n shou ld be. Certainly, they have inspired me ro excel, and as 1 ret urn [Q my country law practice, I am enco uraged and sa tisfied that o ur Associatio n does make a d ifference. When [he leadership baton is passed at the end of this Bar year, President-Elect, Jim Sprott, with his experience and enthusias m will assume the role of President. I kn ow Jim wi ll have a great year, and borh Jim and Jan will serve as excell ent ambassadors fo r our Association. We wish them well on their journey! Judy and I have enj oyed sharing the past three years with you, and we thank yo u aga in fo r allowing us the ho nor and privi lege of serving you . â&#x20AC;˘

Pra ctice Tips, continued from page 28

CUSTODIAL PARENT. Many pani es fi nd this proVISion 111 an agreed PSA ro be down-ri ght insultin g. If this provisio n is nOt included, nocice and oppof(uni ty ro "cure" must be given pri or to filing the petitio n to termin ate parental rights. Final ly, if yo u fi nd a prov ision in a decree th at another attorney has drafted that yo u like, copy it to a special for ms subdirecto ry that you have crea ted to collect yo ur favori te provisio ns fo r decrees. H aving pre-drafted provisio ns kee ps arro rneys from

re-lIlve nung the wheel each time we sec abom to draft. We all have fo rm documents, but in domestic practice, we can also benefit from having form paragraphs, or forms files to deal with panicular issues .â&#x20AC;˘

NEW ETHICS

ADVISORY OPINIONS

The Professional Ethics Committee of [his Association has iss ued a new

\flilliam G. Almand is a number of Hartsfield, Almand, Denison and Mattes, PLLC ill Lirtk Rock. He is Chair of the Domestic Relntions Section of the Arkansas Bar Association.

ad visory o pinion relating to co nfl icts of interests fo r o utside counsel fo r cities. The o pinion is located at www. arkbar. com.

Vo l. 41 No. 21Spring 2006

n,e Arkansas Lawyer

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,

In Melllorialll

Phil Ca rroll. would you learn that Coach had a distin guished military career "in the P~cifi c. hur eve n rhey knew bU[ few details. At a reception in San Francisco in the 70s, a lawyer asked me (BW) if I knew a "Leland Leatherman" from Hot Springs. Arkansas. The lawyer went on to say, " I served under him in rhe Philippines in World War II - he was o ne hellu va gu nn ery officer. " Leland was never the hero in his own stories. Bur stories he did tell. He traveled the world over, including every conrinenr and exotic 10caJe imaginable. Hi s curiosity about peopl e. geography. flora and fauna was boundless. Stories from Leland's trips were funny and fascinating. He regaled his fri ends with tal es of distant places that they might neve r reach. Some friends had the distinct pl eas ure to travel with Leland. A trip with Leland was sure to be the adventure of a li fetime, whether flying in a helico pter over rhe frozen tundra of Alaska or walking on the Great Wall of C hina. He kn ew the mOS t interesting places co visit, and always knew where co find the best food . Leland was that rare breed of lawyer who lived the wo rds of Harry S. Truman: "Ir's amazing what yo u can accomplish if yo u don 't ca re who gets the credir. " He and Sid and H enry formed a law partnership that lasted a lifetime - on a handshake. Each one cred iced the other two with rhe ph enomenal success of the firm. Although Leland was less overtly political than his two friends, he was keenly iIHerested in current events and politics, and frequently served as a facilitator of debates on rhe social, political o r reli gious topics of the day路 and of co urse on spons. The Arkansas Bar has lost one of th e Greau. But Leland Leatherman wi ll surely be remembered as a kind and loya l counselo r co his devoted friends. It

LELAND FLETCHER L EATHERMAN

Leland Fletcher Leatherman. crossed over on Febrary 20. 2006. to join his lifelong friends and law parmers, Sidn ey Sanders M cM ath and Henry Woods. Leland, known affect ionately as "Coach" (Q hi s fri ends-including hi s friends in the coaching profession-was a sports fan in gen eral, but an avid Rawrback supporter in parcicular, reaching back (Q his days as a studem assisram (Q the Razo rback football team in the 1930s. He was also known (Q all those who loved him as a steadfast friend who stuck tight, through thick and thin , never couming the cost. If Leland was yo ur friend - and he had a host of them - he was not only yo ur champion, he was yo ur biggest booster. Coach was truly "the Co mpleat Lawyer." During his career at the bar, he tried jury cases; read abstracts and rendered title opinions; handled domestic relations cases; and drew wills and trust. He even did some federa l tax work. His c.1.lling, though, was (Q help bring electri city (Q rural Arkansas. serving as a tru sted advisor and Gene ral Co un sel to th e Arkansas Electric Coope ratives for many years. Shortly after sening up his law practice in hi .. hom e rown of Hot Springs, Coach served his co unrry in the Second World War und er rh e co mmand of General Douglas MacAnhur. Leland was a genuine war hero, but you would never lea rn thar from talking to him. Only by callin g his WWl I com em porar ies and friends , includ in g Sid McMath, Judge Tom Eisele, Sa m Laser, and 48 TIle Arbnsas lav.ycr

VV'N'N.arkbar.com

By Judge Bill Wilson and Bet h Deere

Rl C liARD

L. MARTIN

Ri chard L. Marrin of Harriso n di ed November 2 1.2005 at the age of91. Martin was a longtime member of th e

Arkansas Bar Association and served on rhe Tax Trust and Estate Pla nning Law

Committee. the Probate Law Committee. and rh e Eco nomi cs of Law Practice Commictce. H e was a sustaining feJlow of the Arkansas Bar Foundation and was a membe r of rhe Ameri can Bar Association and a fellow m ember of the Am erica n Co ll ege of Probate Coun sel. Martin se rved as presiclenr of the Western Arkansas Estate Planning Cou ncil from 1965-66 and presi-

dent

of the

Sebastian

County

Bar

Association from 1964-65. He was active in numerous civi c and church groups during his lifecime. Marrin received three sil ver sta rs for valor and the Purple Heart for his service in rh e U.S. Army as infantry platoon leader and co mpany commander during World War II. H e also served in the Judge Advoca te General Corps during the Korean War. He is survived by one son, three grandchi ldren, and four great-grandchildren.

ELTON ALLISON RIEVES. IV

Elron AJli so n Ri eves, IV of Marion died in December 2005 at the age of 48. Rieves ea rn ed a Bachelor of Science degree from the University of Arkansas in 1979 and a juris d octo rate degree from the Un iversity of Arkansas School of Law in 1981. H e was a member of th e Am erican Bar Assoc iation , the Arkansas Bar Association, and he se rved as president of the Crittenden Cou nty Bar Association. He was invited to jo in the prestigious international Association of Defense Counsel. He was a partner with the Rieves, Rubens & Mayron Law Finn. " H e was a prominelH lav.yer. d edicated famil y man , and avid sportsman," accord ing to an obituary in the Arkansas DemocYOt-Gauru. "Rieves, a member of one of C rittenden County's oldest Families, followed his grandfather and father into the practice of law and began his practi ce in 1982." Rieves is survi ved by his wife, Nancy Loyd Ri eves, twO children , Grace Ellen Rieves and Loyd Nisler Ri eves; his parents, Sally and John Green and Debbie and Elron Rieves. III.


In Memoriam

J UDGE BERNI CE LICHTY KIzER

Retired Judge Bernice Lichty IGzer of Little Rock died January 16, 2006, at the age of90. judge IGzer was born August 14, 1915, in Fon Smith , Arkansas. After graduating from Forr Smith High School in 1932, she worked rwo years checki ng groce ries at Fan Smith's first self-serve grocery store in order [0 save money for co ll ege. She first attended Stephens College in Columbia, Misso uri , where she also waited rahles. Judge Kizer then anencled th e Uni versity of Arkansas at Fayetteville. While her husband was in the Navy during World War IJ, Judge Kize r, who had n.vo children, returned [Q rhe Universiry of Arkansas in order [0 obtain her law degree. She was one of the first five women (a enroll in rhe University of Arkansas chool of Law, and she began practicing law in 1957 after her husband's (Mayne Parker) death. She married H arlan Kize r in 1959. Jud ge Ki zer was a member of the Arkansas House of Rep resem at ives from 1959 ro 1973. She served as chai rman of rhe Labo r Committee, markin g the first time a woman had been chairman of any legislative comm irree, and she was the first woman on the Legislative Cou ncil. She also served as vice chairman of the Joint Budget Comminec and was a member of the Rules Committee, the Savings & Loan Commincc, and the Banking Committee. Upo n co mpletio n of her 14 years as a member of th e Arkansas House of Representatives, Judge Kizer ran for rhe position of chancery/probate judge in the 12th Judicial District and became the first woman elected to a judgeship in Arkansas. She se rved in that capacity from 1974 ro

1986. After retiring from the bench, Judge Kizer again so ught pub li c office and was elected to the Fort Smith Board of DirectOrs, serving from 1988- 1992. At the age of 84, Judge Kizer co ntinued serving in the legal community as a judge o n ass ignment for th e Arkansas Judiciary. Judge Kizer was a longti me member of the Arkansas Bar Associatio n. She was active in num erous civic and church gro ups and received num erous special recognitions throughout her remarkabl e life. She is survived by three children, Dr. James Mayne Parker, Sh irley Parker Wilh ite, and Karolyn Parker Bond; one stepdaughter, Mary Hesslin; o ne brother; five grandchildren and seven great grandchildren.

WOODSON W. uBllx' BASSElT JR. Woodso n W. Bassett Jr. of Fayetteville died January 10, 2006. H e was 70. Basse n ea rn ed his juris doctO rate degree from the University of Arkansas School of Law in 1949. He practiced law in Fayetteville for 43 years. He began practicing law in 1962 when he joined the firm of Dickson, Putm an, Millwee and Davis. which late r became known as Putman, Davis, Bassen. Cox and Wright. In October of 198 1, he joined with his rwo so ns to establish and build the Bassett Law Firm, where he was senior partner. "He set a fine exa mple for o ther lawyers and was a teacher and an inspiration to many yo ung lawyers over the years," according to an ob ituary in the Arkamas Democrnt-Gautte. "H e was widely recognized as an ext rao rdinary trial lawyer. as ev idenced by his induction into th e Ameri ca n College of Trial Lawyers. He was at his best in the courtroom. His life, both personal and professional, was marked by mu ch success and many accomplishments. but at his request, they wi ll not be recited. To use his words, 'It will suffice to say I grew up hard but marri ed well. fat hered three good children, and with linle natural talent, worked very hard and et hicaJly ro succeed as a lawyer. I lived the best way I knew how and had a good and lo ng life. My wife. Marynm. and my three child ren are my ep itaph, making it importanr th at I lived at ai L'"

Bassett was a longtime member of the Arkansas Bar Associatio n where he served as chair of the Workers' Compensat ion Committee and on (he Membership and New H eadqu3 n ers Committees. He is survived by his wife of 55 years, Mary nm Shaw Basse n ; one daughter, Beverly Bassett Schaffer; (wo so ns. Woody and Tod Bassett; two grandchildren; and two siste rs.

JOHN DAVID WALL

John David Wall of Fayetteville died January 10, 2006. He was 38. Wall ea rned degrees in accou nting and data processing from the Universiry of Arkansas at Fayerreville and earned hi s juris doctOrate degree from (he University of Arkansas School of Law in 1992. Wall was a partner with the Bassett Law Fi rm in Fayettevi ll e. He was li censed to pracrice law in the states of Arkansas, Missouri and Oklahoma. H e was a member of rh e Arkansas Bar Associatio n where he served o n th e Civil Litigation and Worker's Co mpensa tion Sections. "David's kind nature and willing attitude led him to compassionately rep resent a wide vari ery of diems in legal matters big and small ," according to an obituary in the Nor/hzves/ Arkansas Times. "His professionalism and imegrity were absolute and David garne red the respect of the judiciary, his clients and his opposition. David was the quintessential "lawyer's lawyer" and his dedication, wry smile and sense of humor will be forever missed in the legal co mmunity." Wa ll is su rvived by hi s mother, Jacque Wal l of Tulsa, OK; hi s father, Jerry Wal l of Fayetteville; a sister, Jenny Berry of Fayeneville; and a brother, Jeff Wal l of Dallas.

DEAN A.

GARREn"

Dean A. Garren of Fort Smith died January 18, 2006. H e was 65. H e was a longtime member of the Arkansas Bar Associarion and practiced law for 38 yea rs in Newport, Little Rock and Fort Smith . Ga rren se rved three years in th e U.S. Army as a Lieute nant. He graduated from rhe

Vol. 41 No. 21Spring 2006

n,e Ark"nSllS u llvyer

49


In MClllori;.ml Unive rsity of Arkansas at Fayetteville with a degree in busi ness and ea rned hi s juris doctorate degree from rhe University of Arkansas School of Law. H e played footbal l at the University of Arbnsas in 1959. 1960 and 1961. Garren is survived by three sons; tWO daughters; and eight grandchildren.

J UDGE HARRy

LEE

PONDER,

J R.

Judge H arry Lee Po nd er. Jr.â&#x20AC;˘ a lifelong res ident of Walnut Ridge. died February 2. 2006 at the age of94. The grandson of Col. Willis Mil es Po nder. founder of Walnut Ridge. Judge Ponder began practi ci ng law in WaJnut Ridge in 1934. Po nder se rved as muni cipal judge 15 years and se rved fo r three tcrms as prosecuting attorney, reti ring in 1998. Judge Ponder ea rned his juris doctorate degree from the Un ivers ity of Arkansas School of Law. H e was a longlime member of the Arkansas Bar Associatio n and served on the Insurance Law Commictee, Pre-Law Adviso rs Committee, and Membership Co nllnittee. H e was an o rigi nal member of the State Board of Hi gher Education, a mem ber of me Lawrence Coun ty Library Boa rd. and president of the C hamber of Co mm erce. " Law was his li fe. H e love, loved it," said his daughter Marianne Snapp of Wal nur Ridge in the Arkansas Democrat-Gautte. " I remember as a young girl me firsr tim e I saw him in the courtroom. I was just amazed. " Judge Po nder is survived by a daughter. Marianne Ponder Snapp of Walnut Ridge; a so n, Harry Lee Ponder III of Washin gcon, D.C; five grandchildren. eight great-grandchildren and one great-grear-gra nd child.

EDWARD SCRJMSHIRE

Edwa rd Scrimshire of Malvern died February 10. 2006 at the age of 63. H e anended Ouachita Baptist Un iversity o n a fomball scholarship and he graduated from rhe University of Arkansas School of Law. Scrimshire was a longtime member of the Arkansas Bar Association and practiced law for 33 years. He was a depu ty prosecutor for J 2 years and served as circui( judge at Rock port and prosecuting anorney at Friendship. He was a vetera n of rh e U.S. Ma rin e Co rps and a member of the Fi rst 50 TIle Arkansas la\-'Ycr

WVv"YV.arkbar.com

Baptist C hurch in Malvern . Scrimshirc survived by four grandchildren.

IS

J AY NOBLE TOLLEY

Jay Noble Tolley of Fayetteville died Feb ruary 13. 2006. He was 62. He earned his juris doccorate degree from the Universiry of Arkansas School of Law and practi ced law in Fayetteville for 33 years. After law school , he worked for the office of the U.S. Attorney General and served as junior law clerk fo r Federal Distri ct Court Judge J. Smith Henley. He practiced with the firm of C rouch, Blair, Cypert and Waters and also served for eight years as an adm inistrative law judge for the Arkansas Wo rkers' Compensation Co mmiss ion. He reemered private practice in 1987 and was pract.icing as senior parmer of Tolley and Brooks, PA at the time of his death. H e was a member of me Arkansas Bar Association. Tolley is survived by his wife of over 18 years. Evelyn Elizabeth Brooks; his six chil dren; his mother and one sister.

WILLIAM STEPHEN

CRAIN

W illiam Stephen Crain of Hope died February 18. 2006. He was 66. He graduated from rhe University of Arkansas at Fayeneville wirh a degree in busin ess ad ministration and ea rn ed his juris docto rate degree from th e University of Arkan sas School of Law in 1965 . Crain was a member of the Arkansas Bar Associatio n and was licensed to practice law in Arkansas and Ten nessee. H e practi ced law with his grandfather, Seeh Atkins, in Hope until he wenr to wo rk at me Hale and Fogleman Law Firm in West Memphis. C rain then went to work for Dobbs House Inc. until he moved to Mountain H ome where he was City Attorney from J 976 to 1978. C rain was practicing law in orth Li ttle Rock from the early 1980s until the time of his dea th. He is survived by rwo children; five gra ndchildren and twO brothers.

GEORGE L. TAYlOR George L. Taylor of EI Dorado died March 5. 2006 at the age of 55. Taylo r was a member of rhe Arkansas Bar

Association where he se rved on th e Juvenil e Justi ce and Lawye rs Hel ping Lawyers Co mmittees. H e was also a member of the Union County Bar Associatio n. He served as president of So uth Arkansas You th Services and as a deaco n of rhe First Christian C hurch. Taylor is survived by his wife. Cecile Shackl eford Taylor; a so n, William C layto n Taylor II ; and a daughter. Claud ia Elizabeth Taylo r.

J AMES MADISON

BARKER, J R.

James Madiso n Barker. Jr. of H amburg died December 26. 2005. H e was 77. Barker graduated fro m Louisiana Tech University in Rusto n, LA in J 952 after se rving in the United States Navy. He earned hi s juris docm rate degree from the Univers ity of Arkan sas School of Law in 1960. Followin g graduat.ion. Barker moved his fumi ly moved to H amburg where he entered the pri va te practice of law and lived fo r the remainder of his life. " During his legal ca ree r, Barker helped his cl ients with legal iss ues of almost eve ry type imaginable. and was a lo ng-time advisor and co nfidante ( 0 several area businessm e n and a memo r ro younge r lawyers." according to an obituary in the Arka.nsas Democrat-Gautte. H e served as Ci ty Anomey of H amburg and as counsel ro rhe sta te on child supporr enforcement matrers in Ash ley Co un ty. Barker was a member of the Arkansas Bar Association and the First United Methodist C hurch of H amburg. where he was active in the Men's Bible C lass and United M ethodist M en. Barker is surv ived by his wife, M ary Moye rs Barker; twO children; and four grandchildren.

EUZABETH CLARK

Eli zabeth C lark of Lirtie Rock died January 8. 2006. She was 99. She was a longtime member of th e Arkansas Bar Association and a member of rhe Universiry of Arkansas Agriculture Service a[ Lonoke Co un ty. She is survived by two sisters.


The Arkallsas Bar Foundation acknowledges witb g,.ateful appreciatio1l tbe receipt of tbe following memorial, bOllorarium and scbolarsbip cOlltributions received durillg tbe period December 11, 2005 tbrougb FebNlflry 28, 2006:

IN MEMORY OF W. W BASSEIT, JR. Justice Robert and Charlotte Brown Margaret Compton Dennis and Jan e Shackleford Fred Ursery IN MEMORY OF LLOYD C. BURROW, JR. Judge James Mixon IN MEMORY OF ROBERT Jam es V. Spencer, III

. COMPTON

IN MEMORY OF JAMES B. CRAFTON Dennis and Jane Shackleford IN MEMORY OF PH ILlP E. DIXON Gregg & Farris IN MEMORY OF MAXINE GREEN Judith Gray Rick and Clair Ramsay IN MEMORY OF J UDGE BERNICE KlZER Tom and Debbie Daily IN MEMORY OF LELAND LEATHERMAN Judith Gray Dennis and Jane Shacklefo rd Fred Ursery IN MEMORY OF W ILLIAM S. MEEKS Judge James M ixon IN MEMORY OF WALTER N IBLOCK Gregg & Farris IN MEMORY OF JUDG E ANDREW PONDER Gregg & Farris IN MEMORY OF HARRY PONDER J. "Jack" D eaco n G regg & Farr is

c.

IN MEMORY OF TOM PRENTI CE Judge James Mixon IN MEMORY OF LOUIS L. RAMSAY Rick and Clair Ram say

IN MEMORY OF ELTON RJEVES, IV Marc Barerz J. C. "Jack" Deacon Roscopf & Roscopf, P.A. Dennis and Jan e Shackleford Fred Ursery Richard WattS IN MEMORY OF ED SCRJMSH l RE B. Jeffrey Pence IN MEMORY OF JAY TOLLEY Judges Paul and Elizabeth Danielso n B. Jeffrey Pence James D. Sprott IN MEMORY OF JULIE WHETSTONE Judith Gray IN MEMORY OF CARL \'V'HILLOC K Tom C. Morris SCHOLARSH IP CONTRJBUTIONS JOE C. BARREIT SCH OLARSH IP J. "Jack" Deacon

c.

WILSON & ASSOCIATES ETHICS SCHOLARSH IP Robert M. Wilson, Jr. IN HONOR OF THE ARKANSAS BAR ASSOCIATION Rebsamen Insurance Foundation IN HONOR OF DAVID SOLOMON Designated to the David Solomon Scholarship Fund Joseph Boeckmann John D. Bridgforth Can er Dooley Easley, Hudso n & Houseal First Bank of the Delta Robert M. Ford Helena Bridge Termi nal , Inc. Helena Marine Service, Inc. Jim Luker Janles N . Miller C hristopher W. Morledge W. Frank Mo rledge Jerry Don Roberts Sharp & Sharp, P.A. Judge Bentley E. Story

Vol. 41 No. 2/Spring 2006

n,e Arkansas Lawyer

51


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The Arkansas Lawyer - Spring 2006