Case Survey: Massey v. Fulks 2011 Ark. 4 UALR Law Review Published Online Only

Transcription

1 THE SUPREME COURT OF ARKANSAS HELD THAT UPON ENACTING (H), THE LEGISLATURE INTENDED TO EXTEND THE NON-CLAIM PERIOD FOR TWO YEARS WHEN REQUIRED NOTICE IS NOT GIVEN. In Massey v. Fulks, 1 the Supreme Court of Arkansas held that the Arkansas Legislature intended to extend the non-claim period, pursuant to Ark. Code. Ann (h), for two years when required notice is not given. 2 Also, regarding the holding in Dodson v. Charter Behavioral Health System of Northwest Arkansas, Inc., 3 the court found that there was nothing to overrule pertaining to the facts of the case at hand. 4 Kevin Massey ( Massey ), the appellant, is the father of an elevenyear-old minor ( L.M. ), who is the victim of Derek Cockayne s (the Decedent ) sexual misconduct. 5 Massey appealed the Stone County Circuit Court s order of summary judgment for the appellees, the Estate of Derek Cockayne and the executors of the estate, Morris Dee Fulks and James Winters (the Estate ), in which it found that Massey s claim against the Estate was barred by the statute of non-claim. 6 Upon appeal, the Arkansas Court of Appeals agreed with the Stone County Circuit Court by affirming its conclusion of entering an order for summary judgment. 7 Following the affirmation by the Arkansas Court of Appeals, Massey appealed the case to the Supreme Court of Arkansas, and it granted his petition for review. 8 Upon appeal to the Supreme Court of Arkansas, Massey contended that he was a known or reasonably ascertainable creditor who had two years in which to file his claim because the Estate failed to give him actual notice of the non-claim deadline, and that the court s holding in Dodson, should be overruled because it is contrary to the relevant statutory provisions contained in the probate code. 9 The following dates of each event are particularly important because this case turns on whether a certain time frame for filing a claim was met by Massey. On September 25, 2007, the Decedent committed suicide as the police executed a warrant for his arrest regarding his sexual misconduct with 1., S.W.3d. 2. Id. at 10, S.W.3d at Ark. 96, 983 S.W.2d 98 (1998). 4. Massey,, at 11, S.W.3d at. 5. Id. at 2, S.W.3d at. 6. Id. at 1, S.W.3d at. 7. Id., S.W.3d at. 8. Id., S.W.3d at. 9. Id. at 1 2, S.W.3d at. 1

2 L.M. 10 On October 1, 2007, the Probate Division of the Stone County Circuit Court admitted the Decedent s will to probate, and it appointed Fulks and Winters as co-executors of the Estate. 11 On October 3, 2007, and October 10, 2007, in accordance with the executor s obligation under Ark. Code Ann , the Estate made available in the Stone County Leader a notice to creditors. 12 On January 23, 2008, Massey sent a letter to the Estate s attorney, and it explained to the Estate that Massey was thinking about filing a lawsuit against it, because of the Decedent s sexual misconduct with his son, L.M. 13 On February 11, 2008, in the Circuit Court of Stone County, Massey filed suit on behalf of L.M. 14 In the complaint, he asserted claims of battery, false imprisonment, and outrage. On February 21, 2008, in its answer, the Estate denied Massey s claims against the Decedent. 15 On March 19, 2009, in the Estate s amended answer, which also contained a motion for summary judgment, the Estate contended that the sixmonth, non-claim period provided in Ark. Code Ann (a)(2) had concluded on April 3, Pursuant to the court s holding in Dodson and Ark. Code Ann (a)(2), the Estate argued that even though Massey filed his first complaint within the non-claim period in circuit court, his claim should be barred because he did not file a claim against the Estate in probate court. 17 In contesting the motion for summary judgment, Massey argued that, pursuant to Ark. Code Ann (a)(4)(A), he was a known or reasonably ascertainable creditor, thus, he was entitled to actual notice. 18 Therefore, because he did not receive any notice from the Estate, and because Ark. Code Ann (h) provides two years to file a claim when notice is not given, he argued that his claim should not be barred. 19 Massey disagreed with the Estate that the court s holding in Dodson applied to the case at hand, because the court did not address the issue of whether the non-claim period was extended for two years when a creditor who is identified during the non-claim period is not afforded actual notice. 20 The Estate countered Massey s argument by explaining that the court addressed the issue in the dissenting opinion, when the court found 10. Massey, at 2, S.W.3d at. 11. Id., S.W.3d at. 12. Id., S.W.3d at. 13. Id., S.W.3d at. 14. Id., S.W.3d at. 15. Id., S.W.3d at. 16. Massey,, at 2 3, S.W.3d at. 17. Id. at 3, S.W.3d at. 18. Id., S.W.3d at. 19. Id., S.W.3d at. 20. Id., S.W.3d at.

3 that, as reasonably ascertainable creditors, the plaintiffs were entitled to actual notice. 21 Both the circuit court and the appeals court agreed with the Estate and granted its motion for summary judgment. 22 Both courts made it clear that because Massey did not file a timely claim, and because the facts between Dodson and the case at hand were so similar, the rule in Dodson controlled and Massey s claim was barred. 23 Consequentially, these holdings by the lower courts left two issues for the Supreme Court of Arkansas to review: (1) whether Massey was a known creditor as of the time he filed his complaint in circuit court, thus, entitled to actual notice under Ark. Code Ann (a)(4)(A); and (2) whether the court s holding in Dodson is contrary to the lower courts statutory interpretation, thus, Dodson should be over turned. 24 Regarding the first issue, the court analyzed the language of Ark. Code Ann and , and it reviewed its holding in two other cases with factual similarities. 25 The first case, In re Estate of Spears, 26 dealt with an appeal from the lower courts pertaining to the non-claim period under Ark. Code Ann (h). 27 In Spears, the court held that an estate s creditor is required to be subject to identification during the nonclaim period, and it disagreed with the argument that all estates must be kept open for two years in case additional claims came to light after the nonclaim period expired. 28 Because the default happened subsequent to the filing claims deadline, the court held that the claim was barred because it was not reasonably ascertainable during the non-claim period. 29 Using a similar analysis as it did in Spears, the court found in its second case, Brasel v. Estate of Harp, 30 that because the appellant s claim could not have been identified during the non-claim period, she did not maintain the status of a reasonably ascertainable creditor. 31 In Dodson, the last case that the court reviewed and the same case that Massey used to buffer his argument, the court explained that the plain language of Arkansas Code Annotated, Section (a)(2) required claims for injury or death to be filed within the probate estate during the non-claim period and that the filing and service of a complaint in circuit 21. Id., S.W.3d at. 22. Massey,, at 4, S.W.3d at. 23. Id. at 4 5, S.W.3d at. 24. Id. at 4, 10, S.W.3d at. 25. Id. at 5 7, S.W.3d at Ark. 54, 858 S.W.2d 93 (1993). 27. Massey,, at 7, S.W.3d at. 28. Id., S.W.3d at. 29. Id., S.W.3d at Ark. 379, 877 S.W.2d 923 (1994). 31. Massey,, at 8, S.W.3d at.

4 court did not satisfy the requirements of the non-claim statute. 32 Therefore, the court held that the claims were barred as against the assets of the decedent s estate. 33 In applying its statutory interpretation of Ark. Code Ann (h) and the conclusion it drew from reviewing the similar cases, the court held that because Massey s filing and service of the complaint during the non-claim period did not meet the requirement of filing a claim against an estate, and because Massey filed and completed service of the complaint against the Estate in circuit court, thus, identifying himself within the non-claim period as a creditor of the Estate, Massey was a known creditor of the Estate and was entitled to actual notice under Ark. Code Ann (a)(4)(C)(i). 34 After the court considered these peculiarities, it analyzed Massey s contention, which was a question of first impression, in which Massey alleged that Arkansas Code Annotated, Section (h) extends the non-claim period for two years when an estate fails to give actual notice to a known or reasonably ascertainable creditor who is identified during the nonclaim period. 35 The court agreed with Massey s argument by concluding that Massey appropriately filed within the two-year period a claim against the Estate. 36 It held that the failure to give actual notice to known or reasonably ascertainable creditors who are identified during the non-claim period results in the denial of due process. 37 Additionally, regarding the enactment of Ark. Code Ann (h), the court decided that the legislature intended to extend the non-claim period for two years when the required notice is not given. 38 In reviewing the second issue argued by Massey, the court noted that [t]he sole issue in [Dodson] was whether the filing and service of a complaint in circuit court was the functional equivalent of filing a claim against an estate. 39 Therefore, because neither party in Dodson raised the contention that based on the lack of actual notice the non-claim period should be extended, the court was not going to draw a conclusion from its prior holding in order to overrule it using the present case. 40 In this case, the Supreme Court of Arkansas demonstrated how the intent of the Legislature during the law making process can impact the out- 32. Id. at 8-9, S.W.3d at. 33. Id. at 9, S.W.3d at. 34. Id., S.W.3d at. 35. Id., S.W.3d at. 36. Massey,, at 10, S.W.3d at. 37. Id., S.W.3d at. 38. Id., S.W.3d at. 39. Id., S.W.3d at. 40. Id. at 10 11, S.W.3d at.

5 come of cases with certain facts that were not even fathomed at the time of passage. Also, because the Legislature specifically defines the notice requirement depending on what its intent for the law is, the parties must construe their arguments based on the facts of the case, which leaves the court to decide whether they fulfill the Legislature s intent. In the present case, the court made clear that when there is a lack of sufficient notice, it is the intent of the Legislature to extend the non-claim period for two years. * Andrew Ritchie