Opinion ID: 2278218
Heading Depth: 1
Heading Rank: 2

Heading: DeHaven's Appeal

Text: As the second appeal involved in this case, DeHaven filed an appeal from the trial court's dismissal of it from the litigation at the close of the Trustee's case upon a directed-verdict motion. On appeal, DeHaven argues that it only appeals from the portion of the chancellor's order denying its request for attorney's fees, and asserts three points in support of this argument. First, DeHaven argues that the trial court was correct in requiring the Trustee to reimburse the bond accounts. Second, DeHaven argues that the trial court erred in failing to recognize that its escrow agreements were incorporated into the Districts' Pledges and Mortgages signed by the Bank that same day. Finally, DeHaven argues that the trial court erred in failing to realize that DeHaven suffered the same damages as the Districts, and that DeHaven's help in recovering those damages also entitles it to attorney's fees. First, the trial court dismissed DeHaven from the litigation upon a motion by the Trustee to dismiss both DeHaven's and the Districts' claims. At trial, the court indicated that the dismissal was due to lack of proof, and in its final order the court indicated that DeHaven was dismissed for failure to prove any breach of a duty, either fiduciary or contractual ... and for failure to establish any damages sustained by the DeHaven Group.... A chancery court is to evaluate the motion for directed verdict by deciding whether, if the proceeding were a jury trial, the evidence would be sufficient for the case to go to the jury. See Swink v. Giffin, 333 Ark. 400, 970 S.W.2d 207 (1998). In its evaluation of the plaintiff's case, the chancery court is not to assess the credibility of the testimony presented by the plaintiff's witnesses. Id. To determine whether the plaintiff has presented a prima facie case, the trial court must view the evidence in the light most favorable to the nonmoving party, and give the evidence its highest probative value, taking into account all reasonable inferences deducible from the evidence. Bradford v. Verkler, 273 Ark. 317, 619 S.W.2d 636 (1981); Suzuki of Russellville, Inc. v. Mid-Century Ins. Co., 14 Ark.App. 304, 688 S.W.2d 305 (1985). If the evidence, viewed in the light most favorable to the nonmoving party is insubstantial, the trial court should grant the defendant's motion for directed verdict. City of Little Rock v. Cameron, 320 Ark. 444, 897 S.W.2d 562 (1995). 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.; Burns v. Boot Scooters, Inc., 61 Ark.App. 124, 965 S.W.2d 798 (1998).
DeHaven first argues that the trial court erred in finding lack of proof of a breach of duty due to the fact that DeHaven did not sign the Pledge and Mortgage Agreements upon which the court relied to find a breach of contract. DeHaven argues that the escrow agreements it signed with the Trustee were incorporated into the Pledge and Mortgage agreements, thus making it a party to those documents through incorporation by reference. As the Trustee suggests, we cannot find where DeHaven argued during the discussion on the directed-verdict motion that these contracts were incorporated by reference so that it was included in the Pledge and Mortgage agreements as a party to those agreements. During the discussion regarding the motion for directed verdict the court discussed DeHaven's lack of proof as to damages sustained, but did not discuss how DeHaven planned to dovetail its participation into the Pledge and Mortgage agreements. As such, this argument is raised for the first time on appeal, and we, therefore, will not consider it. Hurst v. Holland, 347 Ark. 235, 61 S.W.3d 180 (2001); Ghegan & Ghegan, Inc. v. Barclay, 345 Ark. 514, 49 S.W.3d 652 (2001). 2. Lack of Proof of Damages DeHaven next argues that the trial court erred in finding that DeHaven did not prove that it was damaged by the money paid for attorney's fees to the Trustee's attorneys. DeHaven argued below that because the money was taken out of the bond accounts to pay for fees, this delayed the retirement of the bonds, which delayed the release of the escrow agreements as security for the bonds. DeHaven notes that its Collateral Assignment and Security Agreement lays out the procedure for the Trustee's ability to collect DeHaven's proceeds from the escrow accounts to pay a portion of the bond amounts. As part of that procedure, as soon as the bonds are retired and nothing is left owing under the Pledge and Mortgage agreements, DeHaven's and the Trustee's agreement becomes void, and DeHaven then resumes the right to collect all income due under the escrow accounts. Therefore, the sooner the bonds are paid, the sooner DeHaven begins to receive money from the escrow accounts. However, as noted above, the Trustee did not breach an agreement with DeHaven and, therefore, DeHaven has no cause of action on which it was the prevailing party to recover fees under Ark.Code Ann. § 16-22-308. Therefore, fees are not warranted. Affirmed.