Court Opinion

ID: 3186465
Source: CourtListenerOpinion
Date Created: 2016-03-17 16:14:11.425256+00
Date Added: 2024-06-11T12:21:31.215248
License: Public Domain

Cite as 2016 Ark. 124

                SUPREME COURT OF ARKANSAS
                                       No.   CV-15-785

MAURICE R. LIPSEY, WILLIAM                        Opinion Delivered   March 17, 2016
LARRY COX, and CONNIE L. COX
                     APPELLANTS                   APPEAL FROM THE CLEBURNE
                                                  COUNTY CIRCUIT COURT
V.                                                [NO. CV-2011-223-4]

                                                  HONORABLE TIM WEAVER,
KAREN GILES                                       JUDGE
                                  APPELLEE
                                                  AFFIRMED.

                            ROBIN F. WYNNE, Associate Justice

       Maurice R. Lipsey, William Larry Cox, and Connie L. Cox appeal from an order of

the Cleburne County Circuit Court granting summary judgment in favor of appellee Karen

Giles on their complaint. They argue that the circuit court erred by granting summary

judgment because (1) Giles failed to come forth with proof on their theories of damages and

(2) they met Giles’s lack of proof with proof of a question of material fact as to the existence

of damages. As this court has previously heard an appeal in this case, our jurisdiction is

pursuant to Arkansas Supreme Court Rule 1-2(a)(7) (2015). We affirm the grant of summary

judgment.

      Appellants are property owners and holders of oil-and-gas leases in Cleburne County.

Karen Giles is the Cleburne County Circuit Court Clerk. Appellants filed a class-action

complaint in which they alleged that Giles and two of her deputies falsely and fraudulently
                                     Cite as 2016 Ark. 124

notarized oil-and-gas leases. Specifically, the complaint alleged that landmen, who were

procuring the leases on behalf of oil-and-gas companies, obtained landowners’ signatures on

the leases and delivered them to the clerk’s office, where the clerks notarized the signatures

and recorded the leases, despite the fact that the clerks had not witnessed the landowners

signing the leases. Appellants alleged that their leases were fraudulently notarized; however,

they did not allege that their leases were fraudulently or illegally procured. Appellants sought

an injunction requiring appellee to “inspect and verify each and every oil and gas lease

received for recording and filing to determine if the notarial acknowledgment is accurate,

true, and correct.” Appellants sought to enjoin appellee to “purge any and all oil and gas

leases which contain false notarial acknowledgments.”        Appellants also sought costs and

attorney’s fees.

      After discovery had commenced, appellants filed a motion for injunction. During the

hearing on the motion for injunction, the circuit court questioned appellants regarding their

damages. After concluding that appellants had not been damaged, the circuit court dismissed

the case on its own motion. Appellants appealed from the written order dismissing the case.

This court reversed and remanded, holding that the sua sponte dismissal deprived appellants

of notice and the opportunity to meet proof with proof and demonstrate that a material

question of fact existed regarding whether they had suffered damages due to the allegations

in the complaint. Lipsey v. Giles, 2014 Ark. 309, 439 S.W.3d 13.

        Following remand of the case to the trial court, Giles filed a motion for summary

judgment in which she alleged that appellants had failed to demonstrate that they had suffered

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any damages as a result of the allegations in the complaint. Appellants opposed the motion

and attached to their response an affidavit executed by Tom Ferstl, an attorney and certified

appraiser. In the affidavit, Mr. Ferstl states that, in his opinion, the actions of Giles and the

deputy clerks have had a “chilling effect” on property values in Cleburne County because

buyers will be less likely to purchase property there knowing the uncertainty in the official

county-property records. He further states that, in his opinion, appellants have been damaged

by the inclusion of the fraudulently notarized leases in the county-property records.

Following a hearing, the trial court entered an order in which it found that appellants had

failed to show any damages as a result of Giles’s purportedly unlawful act in recording their

leases and granted the motion for summary judgment. This appeal followed.

       The law is well settled regarding the standard of review used by this court in reviewing

a grant of summary judgment. See Brock v. Townsell, 2009 Ark. 224, 309 S.W.3d 179. A trial

court will grant summary judgment only when it is apparent that no genuine issues of material

fact exist requiring litigation and that the moving party is entitled to judgment as a matter of

law. Id. The burden of proof shifts to the opposing party once the moving party establishes

a prima facie entitlement to summary judgment; the opposing party must demonstrate the

existence of a material issue of fact. Id. After reviewing the evidence, the trial court should

deny summary judgment if, under the evidence, reasonable minds could reach different

conclusions from the same undisputed facts. Id.

       Giles argued before the trial court that she was entitled to summary judgment because

appellant failed to demonstrate how they were damaged by the alleged fraudulent

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notarizations of certain oil-and-gas-leases, and the trial court agreed. On appeal, appellants

argue that the grant of summary judgment by the trial court was in error because (1) Giles

failed to produce proof that there were no damages and (2) the evidence shows that there

exists a factual question regarding whether appellants have been damaged. Regarding the

argument that Giles failed to produce proof of a lack of damages, the standard for summary

judgment is whether the motion established a prima facie entitlement to summary judgment.

In the motion and corresponding brief, Giles detailed how appellants had failed to provide any

proof of damages due to the allegations in the complaint. This is sufficient to demonstrate a

prima facie entitlement to summary judgment that would then require appellants to put forth

proof of damages in order to defeat the motion. Thus, appellants’ argument on that point has

no merit.

       Appellants next argue that the evidence they put forth created a question of fact as to

whether they suffered damages as a result of the conduct alleged in the complaint. They are

incorrect. To be a proper plaintiff in an action, one must have an interest which has been

adversely affected or rights which have been invaded. Reynolds v. Guardianship of Sears, 327
Ark. 770, 940 S.W.2d 483 (1997). Appellants argue that the affidavit of Tom Ferstl showed

that they suffered injury because of the “chilling effect” on their property values. However,

the affidavit contains only conclusory statements on the issue of damages and does not rely on

any facts to support the claim of a “chilling effect” on appellants’ property values. Conclusory

allegations are insufficient to create a factual issue in a summary-judgment situation. Sundeen

v. Kroger, 355 Ark. 138, 133 S.W.3d 393 (2003). Appellants also contend that deposition

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testimony by Giles and Deputy Clerk Heather Smith in which both state that residents have

an interest in accurate records and Smith admits to notarizing leases outside the presence of

the signatories supports their argument that they were damaged. However, the fact that

residents expect accurate records and that Smith improperly notarized certain leases does not

demonstrate that appellants have been damaged when they admit that their leases were

legitimately executed. None of the evidence relied on by appellants creates a factual question

on the issue of whether they sustained damages as a result of the actions alleged in the

complaint. Therefore, the grant of summary judgment by the trial court was not in error and

is affirmed.

       Affirmed.

       Holton Law Firm, PLLC, by: John R. Holton, for appellants.

       Eric Bray; and PPGMR Law, PLLC, by: Kimberly D. Logue, for appellee.

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