Court Opinion

ID: 6552197
Source: CourtListenerOpinion
Date Created: 2022-07-19 22:28:38.991081+00
Date Added: 2024-06-11T15:56:08.335156
License: Public Domain

John B. Robbins, Judge, concurring. I agree that the trial court’s decision upholding the validity of the assignment made by appellee Donna Hadamek to the Bank of Waldron was not clearly erroneous. However, I disagree with that portion of the majority opinion which affirms the trial court’s determination that Ms. Hadamek had standing to seek to quash the appellant’s writ of garnishment. The majority opinion relies on Ark. Code Ann. § 16-110-134(a) (1987) in concluding that Ms. Hadamek had standing to move to quash the writ of garnishment. The quoted subsection (a) should be read, however, in context with the other subsections of § 16-110-134, especially subsection (d) which provides: (d) If it is found that the claimant has a title to, a lien on, or any interest in the property, the court shall make such order as may be necessary to protect his rights. When read in proper context it becomes clear that the “any person” referred to in subsection (a) is a “claimant” who claims “title to,” “a lien on,” or an “interest in” the property. The only relief available under § 16-110-134 is such order of the court “as may be necessary to protect his [the claimant’s] rights.” Ms. Hadamek can not be a claimant, for she successfully contended before the court that she had made an absolute assignment of 100 percent of her interest in the garnished funds to the Bank of Waldron. It is wholly inconsistent to find the funds in issue to belong to the Bank of Waldron rather than Ms. Hadamek, but yet also find that Ms. Hadamek has standing under § 16-110-134 as a “claimant” to present her complaint to quash the garnishment. Rúle 17 of the Arkansas Rules of Civil Procedure provides that every action shall be prosecuted in the name of the real party in interest. It has generally been held that the real party in interest is the person who can discharge the claim which is the subject of an action and not necessarily the person who may ultimately receive some benefit from a recovery on the claim. House v. Long, 244 Ark. 718, 426 S.W.2d 814 (1968). Although a garnishment was not involved in Smith v. National Cashflow Systems. Inc., 309 Ark. 101, 827 S.W.2d 146 (1992), the issue of standing was. The supreme court held: Since Cashflow, as the assignee of a properly assigned account, is the entity who can discharge the claim, it is the real party in interest and, as such, is entitled to bring this action. Id. at 148. See also Ark. Code Ann. § 4-58-106 (Repl. 1991). Rule 17 of the Federal Rules of Civil Procedure also requires an action to be prosecuted by the real party in interest. In the course of amending Rule 17 in 1966 the advisory committee noted: In its origin the rule concerning the real party in interest was permissive in purpose; it was designed to allow an assignee to sue in his own name. That having been accomplished, the modern function of the rule in its negative aspect is simply to protect the defendant against a subsequent action by the party actually entitled to recover, and to insure generally that the judgment will have its proper effect as res judicata. U.S.C.A. Rules of Civil Procedure, Rule 17(a). The question of proper standing in this case should be considered in the light of this function of Rule 17. Because the trial court upheld the validity of the assignment, appellants will not be put to the effort of litigating the validity of Ms. Hadamek’s assignment twice. However, had the trial court found that the assignment was invalid, appellants would surely have faced an attempt by the Bank of Waldron to establish the validity of the assignment. Since the Bank of Waldron was neither noticed to appear nor appeared as a party at the hearing on the motion to quash it would not have been barred by res judicata from relitigating the assignment’s validity. But inasmuch as the trial court upheld the validity of the subject assignment and we are affirming that holding, it does not appear that appellant has been prejudiced by the defect in the party plaintiff. Therefore, I concur in the result of this appeal. However, a determination of whether an objection to standing has merit should not depend upon the outcome of the underlying action.