Case Name: WAL-MART STORES, INC. v. Johnny LONDAGIN, Sue LONDAGIN, and Laura Perkins
Court: Arkansas Supreme Court
Jurisdiction: Arkansas
Decision Date: 2001-03-01
Citations: 344 Ark. 26
Docket Number: 00-1083
Parties: WAL-MART STORES, INC. v. Johnny LONDAGIN, Sue LONDAGIN, and Laura Perkins
Judges: CORBIN, J., not participating.
Reporter: Arkansas Reports
Volume: 344
Pages: 26–44

Head Matter:
WAL-MART STORES, INC. v. Johnny LONDAGIN, Sue LONDAGIN, and Laura Perkins
00-1083
37 S.W.3d 620
Supreme Court of Arkansas
Opinion delivered March 1, 2001
Davis, Wright, Clark, Butt & Carithers, PLC, by: Constance G. Clark, for appellant.
Mashburn & Taylor, by: Timothy J. Myers, for appellees Johnny H. Londagin and Sue Londagin.
Jones, Jones & Lushbaugh, P.L.C., by: Lewis D. Jones, for appellee Laura Perkins.

Opinion:
Ray Thornton, Justice.
We have jurisdiction of this case pursuant to Ark. Sup. Ct. R. 1-2 (b) (1) and (6) because the appeal requires us to construe Rule 408 of the Arkansas Rules of Evidence as it applies to the admissibility of evidence of an effort by Wal-Mart to satisfy a customer complaint during subsequent litigation by a third party seeking to recover damages arising out of the same transaction. The trial court ruled that Rule 408 did not require exclusion of the evidence, and the jury awarded damages. Wal-Mart brings this appeal contending that the trial court committed error in denying its motion to exclude this evidence, and asserts three additional points of appeal. We find no error and affirm.
The relevant facts are that on October 4, 1996, appellee, Laura Perkins, took her truck to the Wal-Mart Tire and Lube Express in Bentonville. Ms. Perkins requested that Wal-Mart change the oil in her truck and rotate the tires. When Ms. Perkins picked up her truck, she noticed that the tires had not been rotated. Wal-Mart moved the vehicle back inside and rotated the tires.
Later in the afternoon of October 4, 1996, Ms. Perkins was traveling on Highway 59 when the left front wheel came off of her truck, crossed the center line, and struck a vehicle owned and operated by appellee, Johnny Londagin, causing his vehicle to wreck. As a result of the wreck, Mr. Londagin sustained injuries. After the wreck, Ms. Perkins called Wal-Mart to report the accident. Wal-Mart sent representatives to the scene and provided Ms. Perkins with a rental car to continue her planned trip to Oklahoma. Wal-Mart then towed her truck back to their shop and had it repaired, all without cost to Ms. Perkins.
On January 13, 1998, appellee, Johnny Londagin and his wife, appellee, Sue Londagin, filed a complaint against Wal-Mart. The complaint sought damages for injuries sustained during the motor vehicle accident on October 4, 1996. The Londagins alleged that the accident was proximately caused by Wal-Mart's negligence and asserted that Wal-Mart failed to properly rotate Ms. Perkins's tires and failed to properly replace the lug nuts on the left front wheel of Ms. Perkins's truck. The complaint sought damages for personal injuries sustained by Mr. Londagin, including past and future medical expenses, pain and mental anguish, permanent disability, lost wages, and loss of enjoyment of life. The complaint also sought damages for loss of consortium on behalf of Mrs. Londagin.
On February 11, 1999, the Londagins amended their complaint to add Ms. Perkins as an additional defendant. The complaint alleged that Ms. Perkins's negligence proximately caused the October 4, 1996, accident because she failed to inspect and to maintain control over her vehicle. On March 9, 1999, Ms. Perkins answered the complaint, denying all allegations of negligence, and filed a cross-complaint against Wal-Mart. On January 31, 2000, Wal-Mart filed a separate cross-complaint against Ms. Perkins alleging that her negligence proximately caused the accident.
On February 8, 2000, Wal-Mart filed a motion in limine requesting exclusion of certain evidence. Wal-Mart sought to exclude "evidence regarding settlement and matters relating to settlement." Additionally, Wal-Mart wanted to "exclude evidence regarding video cameras or lack thereof." A hearing was held to discuss Wal-Mart's requests, and on February 14, 2000, the trial court denied Wal-Mart's motion.
On February 15, 2000, a jury trial was held. After the Londagins's case-in-chief, Ms. Perkins was granted a motion for directed verdict, and her case was dismissed. At the conclusion of the trial, the jury awarded Mr. Londagin $125,000 in damages and awarded Mrs. Londagin $10,000 in damages. It is from this judgment that Wal-Mart appeals, raising four points on appeal.
In its first point on appeal, Wal-Mart argues that the trial court erred when it allowed the Londagins to introduce evidence of WalMart's actions seeking to satisfy Ms. Perkins's complaint. The Londagins introduced evidence at trial that immediately after the accident, Wal-Mart employees came to the scene of the accident, provided a rental car for Ms. Perkins, and towed and repaired Ms. Perkins's truck. Wal-Mart argued in a motion in limine that introduction of such evidence would be in violation of Rule 408 of the Arkansas Rules of Evidence. The trial court denied Wal-Mart's motion and allowed the Londagins to present testimony as to the actions taken by Wal-Mart after the October 1996 accident.
Rule 408 provides:
Evidence of (1) furnishing, offering, or promising to furnish, or (2) accepting, offering, or promising to accept, a valuable consideration in compromising or attempting to compromise a claim which was disputed as to either validity or amount, is not admissible to prove liability for, invalidity of, or amount of the claim or any other claim. Evidence of conduct or statements made in compromise negotiations is likewise not admissible. This rule does not require exclusion if the evidence is offered for another purpose, such as proving bias or prejudice of a witness, negativing a contention of undue delay, or proving an effort to obstruct a criminal investigation or prosecution.
Id. We have strictly applied Rule 408. See Elrod v. G & R Construction, 275 Ark. 151, 628 S.W.2d 17 (1982) (holding that the mere mention of an offer of compromise or settlement was such an egregious error that the only remedy would be to declare a mistrial). We have held that offers are inadmissible to prove a party's liability on the underlying claim. Ciba-Geigy Corp. v. Alter, 309 Ark. 426, 834 S.W.2d 136 (1992). The rationale for Rule 408 is based upon the grounds of promotion of the public policy favoring the compromise and settlement of disputes. See John W Strong, McCormick on Evidence § 266, at 183 (5th ed. 1999). The purpose of Rule 408 is to promote complete candor between the parties to the settlement negotiations. Mo. Pac. R. R. Co. v. Ark. Sheriffs Boys' Ranch, 280 Ark. 53, 655 S.W.2d 389 (1983). However, we have held that Rule 408 is not a blanket prohibition against the admission of all evidence concerning offers to compromise. Edwards v. Stills, 335 Ark. 470, 984 S.W.2d 366 (1998). We have further held that Rule 408 requires the exclusion of statements made in compromise negotiations of a defendant with a third party. See Ark. Sheriffs Boys' Ranch, supra. We have also held that offers to compromise or settle a disputed claim should be excluded from evidence even if no litigation has been commenced at the time of the compromise. See Hickman v. Trust of Heath, House, and Boyles, 310 Ark. 333, 835 S.W.2d 880 (1992).
In the case before us, the actions of Wal-Mart to satisfy the customer complaint made by Ms. Perkins had been completed before Mr.. Londagin brought his complaint, and if the actions of Wal-Mart and Ms. Perkins constituted an offer of compromise and settlement of a disputed claim, the application of Rule 408 would exclude evidence of such an offer.
Our analysis of Rule 408 informs us that there are several elements that must be present in order to exclude evidence of compromise or offers to compromise. To invoke Rule 408: (1) there must be a claim; (2) the purpose of offering the evidence must be to prove liability for, invalidity of, or amount of the claim; (3) valuable consideration must be furnished or offered to be furnished, or promised to be furnished, or valuable consideration must be accepted, offered, or promised to be accepted in an effort to compromise or attempt to compromise a claim; and (4) the claim must be disputed as to either validity or amount. See Ark. R. Evid. 408. The essential elements required to invoke Rule 408 protection have also been explained in McCormick's treatise on evidence. The treatise notes:
to invoke the exclusionary rule, an actual dispute must exist,- preferably some negotiations, and at least an apparent difference of view between the parties as to the validity or amount of the claim. An offer to pay an admitted claim is not privileged since there is no policy of encouraging compromises of undisputed claims, which should be paid in full.
McCormick on Evidence, supra.
Our first inquiry is whether a claim existed between Wal-Mart and Ms. Perkins when Wal-Mart came to the accident scene and assisted Ms. Perkins on October 4, 1996. At trial, Ms. Perkins testified that immediately after the accident she phoned the Wal-Mart tire and lube express center from the scene and was "really upset." She informed Wal-Mart that "there's no way we can fix the truck as it is sitting." Ms. Perkins was informed that someone from Wal-Mart would come and assist her.
Jon Kuntz, a district manager for Wal-Mart tire and lube express, testified that he spoke with Ms. Perkins on the day of the accident. She described what had occurred, and he verified that Wal-Mart had worked on her truck prior to the accident. He informed Ms. Perkins that he would come to the accident scene and then secured a rental car for her. Finally, Mr. Kuntz testified that he participated in completion of the "first report of incident" form. That form states that it is to be filled out "when there is a customer injury as well as when settling a claim in the field." After reviewing the evidence, we conclude that when Ms. Perkins telephoned Wal-Mart, in a disgruntled state, alleging that her wheel had come off of her truck shortly after Wal-Mart had rotated the tires on her truck, and informed Wal-Mart of the accident, she expressed a claim against Wal-Mart.
It is clear that the Londagins were seeking to introduce evidence of Wal-Mart's actions to prove Wal-Mart's liability, thereby satisfying the second prong of our analysis. Additionally, because there was certainly a showing that Wal-Mart furnished valuable consideration to Ms. Perkins to satisfy her claim, the third element of Rule 408 is also present in this case.
The element remaining for analysis is whether Ms. Perkins's claim was disputed. The trial court concluded that the evidence did not demonstrate that Wal-Mart ever disputed the claim as to either validity or amount. The testimony showed that Ms. Perkins called Wal-Mart and notified it as to her claim. Wal-Mart responded to Ms. Perkins's claim by voluntarily bringing her a rental car, towing her truck, and repairing her truck. Wal-Mart towed and repaired Ms. Perkins's truck at no expense to Ms. Perkins, and according to her testimony, without her request that the services be performed. There is simply no showing that Wal-Mart disputed Ms. Perkins's claim, but rather the evidence supports the trial court's finding that Wal-Mart assumed responsibility for wholly paying the claim. The testimony established that Wal-Mart did not require Ms. Perkins to sign any paper work for the rental car or perform any act to authorize the repair of her truck. Moreover, Ms. Perkins testified that Mr. Kuntz apologized at the scene of the accident and assured her that "Wal-Mart would take care of everything." Based on the evidence, we cannot say that the trial court erred in finding that there was no dispute as to either validity or amount of Ms. Perkins's claim. We have held that evidentiary rulings are within the sound discretion of the trial court and will not be set aside absent an abuse of discretion. Ozark Auto Transportation, Inc. v. Starkey, 327 Ark. 227, 937 S.W.2d 175 (1997). Because we find no error in the trial court's finding that there was no dispute as to either validity or amount of the claim, we conclude that the trial court did not abuse its discretion in allowing the Londagins to introduce evidence of Wal-Mart's efforts to satisfy Ms. Perkins's claim.
In its second point on appeal, Wal-Mart contends that the trial court abused its discretion by admitting evidence relating to Wal-Mart's videotaping capabilities and the possible existence of a videotape from the tire and lube service center on the day Ms. Perkins's truck was repaired. In a pretrial motion in limine, Wal-Mart sought to keep such evidence from the jury. In a hearing on the motion, Wal-Mart argued that no videotaping occurred, but that if evidence regarding its videotaping capabilities was introduced, the jury might infer that a videotape of the work on Ms. Perkins's truck was destroyed, misplaced, or hidden. The trial court denied Wal-Mart's motion.
On appeal, Wal-Mart argues that the evidence relating to its videotaping capabilities was not relevant pursuant to Rule 401 of the Arkansas Rules of Evidence. Specifically, Wal-Mart contends that because it presented uncontroverted evidence that there was not a videotape of the service area on the day of the accident, then any evidence relating to Wal-Mart's videotaping capabilities would not be relevant. Rule 401 states that " 'relevant evidence' means evidence having tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence." We have held that a trial court's ruling on relevancy is entitled to great weight and will not be reversed absent an abuse of discretion. Arthur v. Zearley, 337 Ark. 125, 992 S.W.2d 67(1999).
The trial court admitted testimony relating to Wal-Mart's videotaping capabilities and testimony regarding the possibility of a videotape of the service area on the date of the accident into evidence. The evidence was relevant because the case involved a negligence claim. If there was a videotape of the alleged negligent act, it would clearly be relevant. Alternatively, if there was a videotape and it was not made available by Wal-Mart, that evidence would also be relevant. We conclude that the trial court did not abuse its discretion in admitting evidence concerning whether Wal-Mart had videotaping capabilities and whether there was a videotape of the service area on the day the alleged negligent act occurred.
In its third point on appeal, Wal-Mart argues that the trial court erroneously directed a verdict in favor of Ms. Perkins. In examining a trial court's ruling on a motion for directed verdict, we view the evidence in the light most favorable to the party against whom the directed verdict is sought and give it the highest probative value, taking into account all reasonable inferences deducible from it. City of Little Rock v. Cameron, 320 Ark. 444, 897 S.W.2d 562 (1995). A motion for directed verdict should be granted only if the evidence so viewed would be so insubstantial as to require a jury verdict for the party to be set aside. Id. Evidence is insubstantial when it is not of sufficient force or character to compel a conclusion one way or the other or if it does not force a conclusion to pass beyond suspicion or conjecture. Id.
At trial, Ms. Perkins's attorney moved for a directed verdict at the close of the Londagins's case-in-chief. The trial court granted this motion and found:
I have done my best to pay attention to any testimony or evidence that indicated some sort of negligent behavior or inaction on the part of Ms. Perkins. Quite frankly, I see none.... I have listened to this testimony and I have heard nothing indicating that she was speeding or that she was not maintaining proper control of her vehicle, that her responsefs] were late or improper. There has been no evidence that anybody else could have done anything other than what happened, no evidence that she should have had prior notice of the wheel before it fell off, something that would cause her to go ahead and stop. Nothing.... I think [customers], do not have a" duty to go behind tire places like this to start second guessing, checking the work, unless something has placed them on notice that there is something amiss and that something is wrong.
On appeal, Wal-Mart contends that this ruling was erroneous because "there was evidence submitted from which the jury might well have assessed some degree of fault on the part of Ms. Perkins," citing Ms. Perkins's testimony. The testimony Wal-Mart considers sufficient to establish Ms. Perkins's negligence states in relevant part that:
And then all of a sudden the truck — our truck started shaking really bad and we heard this bang and the truck shook. And I noticed out of the corner of my eye that this tire went by and-I wondered whose tire that was because I don't remember hitting anything. There wasn't anything in the road. And I am looking off to the side of the road trying to get the truck off the road once I figured out that that was my tire. When the front end dropped, I just took it off the road.
In determining whether the trial court correctly directed a verdict in Ms. Perkins's favor we must determine whether there was substantial evidence to establish that Ms. Perkins's actions were negligent. We have defined negligence as:
the failure to do something which a reasonably careful person would do. A negligent act'arises from a situation where an ordinarily prudent person in the same situation would foresee such an appreciable risk of harm to others that he would not act or at least would act in a more careful manner. While a party can establish negligence by direct or circumstantial evidence, he cannot rely upon inferences based on conjecture or speculation.
Cameron, supra (internal citations omitted). Applying this definition to the case now on review, we hold that the trial court properly determined that there was insufficient evidence that Ms. Perkins acted negligently so as to submit that issue to the jury. There was no evidence presented that established that Ms. Perkins failed to do something that a reasonably careful person would do.
Specifically, there was no evidence that Ms. Perkins: (1) was speeding; (2) failed to maintain a proper look out; (3) failed to maintain control of her truck; (4) operated her truck when she knew it was unsafe; (5) failed to inspect her vehicle to insure it was in safe working condition; or (6) failed to use ordinary care in the operation of her truck. The evidence showed that as soon as Ms. Perkins realized that her vehicle was unsafe, she pulled immediately off the road. Accordingly, we hold that the trial court did not commit error in finding that there was no substantial evidence of Ms. Perkins's negligence, and in directing a verdict in her favor.
In its last point on appeal, Wal-Mart contends that the trial court committed error when it submitted the issue of Mr. Londagins's future medical expenses to the jury. Wal-Mart argues that the only evidence of Mr. Londagin's future medical expenses was speculative, and therefore, the issue should not have been submitted to the jury. We have held that future medical expenses need not be proven with the same specificity as past medical expenses. Arthur, supra. However, there must be some evidence that medical treatment will be necessary in the future. Id. We have further held that it is not speculation and conjecture to calculate future medical expenses where a jury has before it a history of medical expenses that have accrued as of the date of trial. Williams v. Gates, 215 Ark. 381, 630 S.W.2d 34 (1982). Finally, we have noted that the showing of a degree of medical certainty as evidence bolsters recovery of future medical expenses. See West Union v. Vostatek, 302 Ark. 219, 788 S.W.2d 952 (1990).
In light of these principles, we review the testimony presented at trial to determine whether there was sufficient evidence to submit this issue to the jury. Dr. Robert Taylor, Mr. Londagin's physician, testified at trial. He stated that as a result of the October 1996 automobile accident, Mr. Londagin developed carpal tunnel syndrome in his upper extremities and suffers from a midline abdominal wall injury which has caused some weakening of his anterior abdominal wall. Dr. Taylor further testified that he recommends surgery to repair Mr. Londagin's anterior abdominal wall. He also stated that Mr. Londagin would always have some discomfort as a result of the injury and the only way to repair the injury would be to surgically close the defect. Dr. Taylor estimated that the surgical procedure would cost approximately $10,000.
Mr. Londagin also testified. He stated that he has an injury in his stomach or abdomen, attributed to the October 1996 automobile accident. He further testified that his injury causes him "problems" and that Dr. Taylor recommends surgery to correct his stomach injury. Mr. Londagin also stated that as a result of his injury, he experiences lower back pain when he works around his farm or exerts himself. Mr. Londagin further stated that when he "lifts," his injury causes him pain. Finally, he noted that if his conditions deteriorates, and the doctor recommends it, he would have surgery to repair his abdominal injury.
Wal-Mart argues that "the facts of this case fall squarely within the ruling of the Arkansas Supreme Court in Arthur v. Zearley, 337 Ark. 125, 992 S.W.2d 67 (1999)" and that because this case is so similar to Arthur then the trial court erred when it submitted the issue of Mr. Londagin's future medical expenses to the jury. WalMart's argument is misplaced. In Arthur, supra, we reversed the trial court because it instructed the jury on future medical expenses when there was "no testimony by any physician that Mrs. Zearley will need future medical care, such as surgery, therapy, or medication." Id. We noted that "in the absence of proof that medical expenses were reasonably certain to be required in the future, the jury was forced to resort to speculation and conjecture." Id.
The facts in Arthur are distinguishable from the case now before us. In Arthur, there was no medical testimony that Mrs. Zearley would require future medical expenses. By contrast in the case subjudice, Dr. Taylor's testimony established within a reasonable degree of medical certainty that Mr. Londagin would require surgery in the future to repair his abdominal injury. We conclude that there was sufficient evidence upon which the jury could consider the issue of future medical expenses without resorting to speculation or conjecture. Accordingly, the trial court did not err in submitting this issue to the jury and denying Wal-Mart's motion for a directed verdict.
Affirmed.
CORBIN, J., not participating.
Arnold, C.J., dissents.