Opinion ID: 1653509
Heading Depth: 1
Heading Rank: 1

Heading: The prior incident

Text: Westark defended on two bases. First, it argued that Automotive stacked its inventory from floor to ceiling and refused to move it to allow Westark employees to maintain the sprinkler system properly. Second, Westark contended Automotive breached the lease by failing to have content insurance. After Automotive rested and the defense began its case David Ashby, Controller and Secretary-Treasurer of Westark, testified. On cross-examination by Automotive's counsel, questions about an earlier water loss incident involving another of Westark's tenants, a furniture company owned by a Mr. Stanley, were asked. Counsel for Westark objected on relevancy grounds, and the objection was sustained. A bench conference ensued at which Automotive argued that the earlier loss was to a tenant who had the same lease and the same kind of loss, and thus Automotive was entitled to show that Westark had paid a similar claim. Counsel for Automotive stated, they are contending that they should not be obligated because of this content but this is a similar event that happened just like this that their Company paid. We are entitled to show that to the jury that in one case they paid it. Westark's counsel argued that there were different facts and circumstances in the other incident to which Automotive responded that Westark had the same duty to maintain the system. The Court ruled that the evidence was highly relevant but was too prejudicial to come in. Automotive then asked to make a record of proffered testimony, and the jury was excused. Counsel for Automotive then asked Ashby about the other incident. Ashby testified that the incident had occurred in 1988 when a defective sprinkler system valve triggered but stated he did not know whether the leases were similar in requiring the tenant to have insurance on the contents to cover any loss. Westark again objected to Ashby continuing to testify on the other incident, and the Court again sustained saying unless you can show something else I'm going to sustain the objection. Counsel for Automotive then stated I guess I can subpoena Mr. Stanley in rebuttal and have him bring his lease. Counsel for Automotive asked the Court if he would permit him to put Mr. Stanley on the stand if he was called and the Court stated I am inclined if we are going on the theory that this clause takes you out and you can show the lease[s] are identical then I would be inclined to show that at least from some reason they have either waived thatI think if you can show that the leases are identical at this point I'd be inclined to let him show that or ask him that. After further discussion the Court stated as far as this witness is concerned I'm going to preclude you from going into it Mr. Sharum [counsel for Automotive]. You get your witness here that knows about it. Mr. Sharum replied [w]e will subpoena and have him bring all of his leases. After Mr. Sharum finished questioning Ashby without further reference to the prior incident the Court called counsel to the bench and stated: I think that I have created some confusion. I do not intend to let Steve [Sharum] bring this rebuttal witness unless this witnessyou ask him under identical circumstances if he hasn't paid and if he denies it or says that he doesn't know I think the identical circumstancesI'm assuming that he is going to say since the lease is different he will say nothing and perhaps no. I think you are going to at least broach this enough that you can rebut it. You don't have anything now to be in the nature of a rebuttal. And I think it is something that you will need to bring up so you can rebut itbut you have to be careful. Over continuing objections from Westark, Ashby was questioned about the prior occurrence and the fact that Westark wound up paying the claim. Automotive did not ask Ashby if the circumstances of the prior payment were identical and did not call the other tenant or present his leases. At the close of all evidence Westark moved for a mistrial on the ground that Automotive had been allowed to introduce evidence regarding the prior incident without showing its similarity. Westark also sought a ruling prohibiting Automotive from referring to the other incident in closing argument. Both motions were denied by the Court stating: [T]here was an in camera hearing in which the witness testified before the Court permitted the witness to testify before the jury, and in that hearing the witness indicated that there was damage to the sprinkler system prior to that. He indicated that he did not know whether or not he had the same contract. Counsel for the defendant failed to cross examine as the Court expected on that issue to show the jury that the contracts were not the same, and it was not developed, but that's why that was permitted. The Court felt it was relevant and at least based on the theory that the defendants were claiming that they were not relying on the provision about the Lease on the insurance requirement. That's why it was let in. The foregoing shows that Automotive made no effort to bring in the prior occurrence during its case in chief but sought to bring it in during the defense case or to at least create an allegation for rebuttal. Automotive argues in its brief and oral presentation that this evidence was relevant and should have been before the jury to rebut the comparative negligence assertions of Westark. The general rule with respect to admissibility of evidence of similar occurrences is that it is admissible only upon a showing that the events arose out of the same or substantially similar circumstances, and the burden rests on the party offering the evidence to prove that the necessary similarity of conditions exists. Fraser v. Harp's Food Stores, Inc., 290 Ark. 186, 718 S.W.2d 92 (1986); Carter v. Missouri Pacific Railroad Co., 284 Ark. 278, 681 S.W.2d 314 (1984); Houston General Ins. Co. v. Arkansas Louisiana Gas Co., 267 Ark. 544, 592 S.W.2d 445 (1980); Arkansas Power & Light Co. v. Johnson, 260 Ark. 237, 538 S.W.2d 541 (1976); Fulwider v. Woods, 249 Ark. 776, 461 S.W.2d 581 (1971). The burden on Automotive was to show the similarity in the events, and that burden did not shift to Westark, contrary to the implication of the final ruling. The ultimate purpose of the evidence was to show that Westark had paid for water damage to a tenant's inventory. From that evidence the jury was left to draw the negative inference that Westark had waived the content insurance requirement for that tenant. Absent presentation of that lease and testimony concerning the basis for the prior payment there is no way of reaching that conclusion without rampant speculation. The fact that there was a valve malfunction may have been due to a faulty valve alone and may only peripherally implicate maintenance. It could also have occurred after notice and a failure to act, thereby triggering Westark's obligation under the contract. As there was no showing by Automotive that the occurrences were similar, admission of the testimony enabled the jury to conclude Westark's refusal to pay in the case now before us was unjustified. It may well have been that Westark's payment in the prior case was a part of their obligation under the lease, or it could have been pursuant to a waiver of the requirement as postulated by Automotive, but it was Automotive's burden to prove the facts.