Court Opinion

ID: 9677747
Source: CourtListenerOpinion
Date Created: 2023-08-24 05:58:35.474616+00
Date Added: 2024-06-11T18:16:58.192939
License: Public Domain

James R. Cooper, Judge, dissenting. The appellant’s entire case hinges upon his allegations that Virginia Morris was the actual agent of First National Bank, or that apparent agency existed because Ms. Morris had possession of the promissory note bearing the bank’s letterhead. I dissent because I am convinced that the appellant failed to present proof of Ms. Morris’ agency, an essential element of his claim, and that the appellee was thus entitled to judgment as a matter of law. See Short v. Little Rock Dodge, Inc., 297 Ark. 104, 759 S.W.2d 553 (1988). The majority cites no facts to support the allegation of actual agency. With regard to apparent agency, the only fact relied upon is that Ms. Morris possessed the loan documents. However, we have recently said that: [W]hen a bank directs a borrower to obtain the signature of another on a personal guarantee as a condition of making a loan, the act of the borrower in obtaining the signa-turé is one for his own benefit and the borrower is not the agent of the bank. First Commercial Bank v. McGaughey Brothers, Inc., 30 Ark. App. 174, 785 S.W.2d 236 (1990) (emphasis supplied). It is black-letter law that apparent authority can exist only to the extent that a reasonably prudent person, using diligence and discretion, would naturally suppose the agent to possess in view of the principal’s conduct. Arkansas Poultry Federation Ins. Trust v. Lawrence, 34 Ark. App. 45, 805 S.W.2d 653 (1991). In my view, the agency issue in this case can be summarized as follows: evidence of actual agency is absent, as the majority concedes when it notes that “we do not know who Virginia Morris is or the precise nature of her relationship to the appellant or the bank,” and the only conduct of the alleged principal relied upon to show agency, i.e., providing Ms. Morris with the loan documents, has been held to be insufficient to show implied agency as a.matter of law. First Commercial Bank v. McGaughey Brothers, Inc., supra. It should be pointed out that I do not disagree with the majority’s view of the facts of this case, or with its statements concerning the substantive law of agency. Instead, the difference of opinion in the case at bar stems from divergent views regarding the standard to be applied to appeals from summary judgments. This is understandable in light of the rapid development of this. area of the law in recent years. The majority presumably embraces the “scintilla of evidence” rule whereby the court considering summary judgment, resolving all credibility issues in favor of the non-movant, determines whether there are any facts from which a jury could reasonably infer ultimate facts upon which a claim depends; if there is a scintilla of evidence supporting the non-moving party, summary judgment will be denied under this rule. Some support for the applicability of this rule in Arkansas is found in Thomas v. Sessions, 307 Ark. 203, 818 S.W.2d 940 (1991). I believe, however, that our Supreme Court has adopted the standard enunciated in Celotex Corp. v. Catrett, 477 U.S. 317 (1986), whereby the question is whether, on the basis of the summary judgment record, a reasonable jury could find in favor of the non-moving party at trial. See generally J. Watkins, Summary Judgment Practice in Arkansas: Celotex, the Scintilla Rule, and Other Matters, 15 UALR L.J. 1 (1992). My view is supported by Short v. Little Rock Dodge, Inc., supra, where our Supreme Court said that: It is proper to grant a summary judgment “if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Ark. R. Civ. R 56(c). In Celotex Corp. v. Catrett, 477 U.S. 317 (1986), the Supreme Court interpreted F.R.C.P. 56, which is identical to our rule in every material respect, as permitting a summary judgment when a plaintiff cannot offer proof of a material element of the claim. We agree with the Supreme Court’s rationale that when a party cannot present proof on an essential element of her claim there is no remaining genuine issue of material fact, and the party moving for a summary judgment is entitled to judgment as a matter of law. It would appear under the rule enunciated in Short, supra, that the test on appeals from summary judgments would be analogous to that applied to directed verdicts. See Watkins, supra; see also Short, supra (Glaze, J., dissenting). I submit that this is the applicable standard, and that we should therefore affirm because a reasonable jury could not have found for the appellant on the basis of the summary judgment record in the case at bar. Finally, it should be noted that the precise issue upon which this dissent is based will soon be before the Arkansas Supreme Court. We recently granted a motion to transfer to the Supreme Court in Dodds v. Hanover Insurance Co., CA 93-1152. The issue requiring transfer was the interpretation of Ark. R. Civ. R 56 to determine whether the Celotex rule, as followed by the Arkansas Supreme Court in Short, supra, is applicable where there was a failure of proof concerning agency. The Dodds case is scheduled for oral argument before the Supreme Court on July 5, 1994, and will hopefully resolve the issue giving rise to this dissent. I respectfully dissent.