Taylor v. MCSA LLC.2 , 430 S.W.3d 113 ( 2013 )

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SUPREME COURT OF ARKANSAS
No. CV-13-12
RONNIE TAYLOR, AS SPECIAL Opinion Delivered October 31, 2013
PERSONAL REPRESENTATIVE OF
THE ESTATE OF L.C. TAYLOR, APPEAL FROM THE UNION
DECEASED, AND ON BEHALF OF THE COUNTY CIRCUIT COURT
WRONGFUL DEATH BENEFICIARIES [NO. CV-2010-198-4]
OF L.C. TAYLOR
APPELLANT HONORABLE MICHAEL R.
LANDERS, JUDGE
V.
MCSA, LLC, D/B/A/ MEDICAL
CENTER OF SOUTH ARKANSAS;
COURTYARD REHABILITATION
AND HEALTH CENTER, LLC, D/B/A/
COURTYARD REHABILITATION
AND HEALTH CENTER; SA
ELDERCARE, LLC; JEJ INVESTMENTS,
LLC; UNION ASSETS, LLC; SUMMIT
HEALTH RESOURCES, LLC;
PROCARE THERAPY SERVICES, LLC; REVERSED AND REMANDED.
JOHN PONTHIE; ROSS M. PONTHIE;
AND MARK THOMPSON
APPELLEES
COURTNEY HUDSON GOODSON, Associate Justice
Pursuant to a certification under Rule 54(b) of the Arkansas Rules of Civil Procedure,
appellant Ronnie Taylor, as special personal representative of the estate of L.C. Taylor,
deceased, and on behalf of the wrongful-death beneficiaries of L.C. Taylor (Ronnie), appeals
the orders entered by the Union County Circuit Court granting the motions to dismiss
presented by appellees MCSA, LLC, d/b/a/ Medical Center of South Arkansas; Courtyard
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Rehabilitation and Health Center, LLC; SA Eldercare, LLC; JEJ Investments, LLC; Union
Assets, LLC; Summit Health Resources, LLC; ProCare Therapy Services, LLC; John
Ponthie; Ross M. Ponthie; and Mark Thompson. For reversal, Ronnie contends that the
circuit court erred in ruling that the actions of the prior special personal representative of the
estate were invalid and that the complaints filed by the former special personal representative
were nullities. Alternatively, he argues that the circuit court erred in finding that the two-
year statute of limitations for medical-malpractice claims applies to all causes of action that
were asserted in his complaint. We assumed jurisdiction of this case from the court of
appeals as involving an issue of first impression; hence, our jurisdiction is pursuant to
Arkansas Supreme Court Rule 1-2(b)(1) (2013). We reverse and remand on the first point,
making it unnecessary to consider the second issue.
The record discloses that L.C. Taylor was admitted as a patient to appellee Medical
Center of South Arkansas (MCSA) on December 23, 2008, with admitting diagnoses of
confusion, dehydration, and renal failure. He remained in the hospital until January 6, 2009.
Upon his discharge from MCSA on that date, Taylor became a resident of appellee Courtyard
Rehabilitation and Health Center (Courtyard). On February 2, 2009, Taylor returned to
MCSA, where he died that same day.
On June 3, 2010, Bobby Taylor, as special personal representative of the estate of L.C.
Taylor and on behalf of the wrongful-death beneficiaries of L.C. Taylor (Bobby), filed suit
in the Union County Circuit Court against MCSA, Courtyard, and appellees SA Eldercare
and JEJ Investments. This civil case was assigned to Circuit Judge Susan O. Hickey. The
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complaint alleged that Taylor did not have pressure sores when he was admitted to MCSA
but that he developed Stage II decubitus ulcers to his right hip and buttocks area prior to his
discharge. Bobby claimed that the pressure sores worsened during Taylor’s residency at
Courtyard and that, when Taylor was readmitted to MCSA, he was suffering from a severely
infected, fist-sized decubitus ulcer on his back and also from other pressure ulcers that had
either developed or worsened during his stay at Courtyard. The complaint also alleged that
Taylor died as a result of complications associated with the infected pressure sores, and it
asserted causes of action for medical malpractice against MCSA and Courtyard; negligence
against Courtyard, SA Eldercare, and JEJ Investments (collectively nursing-home defendants);
violations of the Arkansas Long-Term Residents’ Rights Act, Arkansas Code Annotated
sections 20-10-1201 to -1209 (Repl. 2005), against Courtyard; and a claim against the
nursing-home defendants for civil liability under Arkansas Code Annotated section 16-118-
107 (Repl. 2006). Attached as an exhibit to the complaint was an order appointing Bobby
as the special personal representative of the estate entered on March 16, 2009, by Circuit
Judge Michael R. Landers, sitting in the Probate Division of the Union County Circuit
Court. On May 9, 2011, Bobby filed a first amended complaint to include as additional
nursing-home defendants appellees Union Assets, Summit Health Resources, ProCare
Therapy Services, John Ponthie, Ross Ponthie, and Mark Thompson.
On July 28, 2011, MCSA filed a motion to dismiss the complaints filed by Bobby in
his capacity as special personal representative of the estate. In the motion, MCSA alleged that,
during a deposition taken on June 8, 2011, Bobby disclosed that he had been convicted of
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felony mail fraud some thirty years ago. It asserted that, according to Arkansas Code
Annotated section 28-48-101(b)(3) (Repl. 2012), Bobby, as a convicted and unpardoned
felon, was not qualified to serve as special personal representative, and thus he lacked standing
to file suit. In turn, MCSA argued that the order appointing Bobby as special representative
should be vacated, and it asserted that the complaints he filed in that capacity were nullities.
Further, MCSA urged that a dismissal with prejudice should follow because the two-year
statute of limitations for medical malpractice had expired. Courtyard and the other nursing-
home defendants later joined in this motion.
Ronnie, as the recently appointed special personal representative of the estate,1
responded to the motion to dismiss.2 In the response, Ronnie acknowledged that Bobby’s
felony conviction rendered him ineligible to serve as a personal representative, but he argued
that dismissal of the lawsuit was not warranted. He asserted that the actions taken by Bobby
prior to his removal as special personal representative remained valid, even though he was
unqualified. Ronnie also contended that only the probate division had jurisdiction to decide
whether the order appointing Bobby should be vacated, and he argued that, even if the
probate order were vacated, it would not affect the validity of Bobby’s actions as the duly
appointed special personal representative. The circuit court held a hearing on August 31,
2011, and took the motion to dismiss under advisement.
1
The record reflects that Ronnie succeeded Bobby as the special personal
representative of the estate by an order of the probate division dated July 28, 2011.
2
In the heading of the response, Ronnie, as the special personal representative, was
named as the plaintiff in place of Bobby.
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Thereafter, on October 17, 2011, Ronnie filed a second amended complaint. The
style of the complaint again named Ronnie as the plaintiff in his capacity as special personal
representative of the estate, and the complaint realleged and reaffirmed the facts and
allegations contained in the initial and first amended complaints that were filed by Bobby as
the special personal representative of the estate.
Also on October 17, 2011, the circuit court entered an order dismissing with prejudice
the complaint against MCSA. The court ruled that Bobby, as a convicted felon, was not
qualified to serve as special personal representative of the estate. Citing Brown v. National
Healthcare of Pocahontas, Inc., 102 Ark. App. 148, 283 S.W.3d 224 (2008), the court also ruled
that any action taken by him in that capacity was a nullity, including the filing of the
complaints, because he lacked standing to file suit. By like order entered that same date, the
circuit court dismissed with prejudice the claims asserted against Courtyard, SA Eldercare, JEJ
Investments, Union Assets, Summit Health Resources, and ProCare Therapy Services.
On October 24, 2011, John Ponthie, Ross Ponthie, and Mark Thompson filed a
motion for order of dismissal. They alleged that, although they had joined in MCSA’s motion
to dismiss, the circuit court inadvertently neglected to include them in the dismissal orders.3
On November 1, 2011, Ronnie filed a motion to amend the dismissal orders to reflect a
dismissal without prejudice of the claims asserted against the various nursing-home defendants
for ordinary negligence, the violations of the Arkansas Long-Term Residents’ Rights Act, and
for civil liability under section 16-118-107. He asserted that these claims were governed by
3
Judge Hickey entered the dismissal orders just prior to her resignation as circuit judge.
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a three-year statute of limitations and that the second amended complaint filed by him was
timely with regard to those claims. Ronnie also filed a motion seeking reconsideration of the
prior orders declaring that the complaints filed by Bobby were nullities.
After a hearing held on January 31, 2012, the circuit court issued a letter opinion
denying Ronnie’s motion for reconsideration.4 The court confirmed the previous rulings that
Bobby did not have the authority to act on behalf of the estate because of his disqualification
as a felon and that the complaints he filed were nullities. In this regard, the circuit court
reasoned,
Bobby Taylor was a convicted felon long before he ever petitioned the Court to serve
in a capacity for which he was by statute unqualified to serve. At no time was he a
qualified representative, and at no time did he have the authority to act in behalf of the
estate. Therefore, there was no valid probate order appointing Bobby Taylor as
personal representative.
The court also denied Ronnie’s motion to amend the previous orders to a dismissal without
prejudice, finding that all the claims asserted were governed by the two-year statute of
limitations found in the Medical Malpractice Act. The circuit court entered an order
dismissing the claims against John Ponthie, Ross Ponthie, and Mark Thompson on June 21,
2012. The court subsequently issued a final order under a Rule 54(b) certificate on
November 26, 2012.5 This appeal followed.
Before reaching the merits of the appeal, we must first address a threshold matter raised
4
At this point in the litigation, Judge Landers was presiding over both the civil case
and the probate case.
5
Courtyard and the nursing-home defendants had filed a cross-claim against MCSA,
and in turn MCSA had filed a cross-claim against them. The cross-claims remained
outstanding.
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by appellees in their briefs. They contend that Ronnie, as special personal representative of
the estate, never became a party to the litigation because he failed to obtain an order from the
circuit court substituting him as the plaintiff after he succeeded Bobby as the special personal
representative. Appellees argue that Ronnie lacks standing to prosecute the appeal and that
the appeal should be dismissed on grounds of subject-matter jurisdiction because an appellate
court cannot act on an appeal by one who was not a party to the action below.6 Otherwise,
appellees assert that they did not waive the issue of standing because Courtyard, John Ponthie,
and Mark Thompson noted the lack of substitution in their answers to the second amended
complaint filed by Ronnie, and because the matter was mentioned at the hearing held on
January 31, 2012. Ronnie responds that appellees did waive this issue, and he also asserts that
any argument made by appellees in circuit court was cursory and undeveloped.
Appellees’ complaint is that Ronnie was not formally substituted as the plaintiff after
succeeding Bobby as the special personal representative of the estate. Their argument is based
on the law of revivor and substitution. On this subject, Arkansas Code Annotated section 16-
62-108 (Repl. 2005) provides in part as follows:
An order to revive an action in the names of the representatives or successor of a
plaintiff may be made forthwith. However, an order to so revive the action shall not
be made without the consent of the defendant after the expiration of one (1) year from
the time when the order might first have been made.
Also pertinent is Arkansas Code Annotated section 16-62-109 (Repl. 2005),7 which
6
Appellees first raised this issue in a motion to dismiss when the case was pending
before the court of appeals. The court of appeals denied the motion by syllabus entry.
7
We note that appellees cite Arkansas Code Annotated section 16-62-105 (Repl.
2005). However, we deemed subsections (a) through (e) of this statute superseded by the
Arkansas Rules of Civil Procedure in the per curiam In re Statutes Deemed Superseded by the
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states,
When it appears to the court by affidavit that either party to an action has been dead,
or, where he or she sues or is sued as a personal representative, that his or her powers
have ceased for a period so long that the action cannot be revived in the names of his
or her representatives or successor without consent of both parties, it shall order the
action to be stricken from the docket.
In addition, Rule 25 of the Arkansas Rules of Civil Procedure, which governs the
substitution of parties, provides in relevant part,
(a) Death. (1) If a party dies and the claim is not thereby extinguished, the Court may
order substitution of the proper parties. The motion for substitution may be made by
any party or by the successors or representatives of the deceased party, and such
substitution may be ordered without notice or upon such notice as the Court may
require.
In discussing the interplay between the revivor statutes and Rule 25, this court made clear in
Ausman v. Hiram Shaddox Geriatric Center, 2013 Ark. 66, ___ S.W.3d ___, that while Rule 25
governs the procedure for substituting a party, the one-year statute of limitations found in
section 16-62-108 remains in effect.
However, the requirement of substitution is subject to waiver. This court has
recognized that, when a motion for revivor is not made in a timely manner, and a
representative continues the action without objection, it has generally been considered a
waiver of such a motion. Speer v. Speer, 298 Ark. 294, 766 S.W.2d 927 (1989). See also Short
v. Stephenson, 239 Ark. 287, 388 S.W.2d 912 (1965); Obennoskey v. Obennoskey, 215 Ark. 358,
220 S.W.2d 610 (1949). We also have declined to address this issue for the first time on
Arkansas Rules of Civil Procedure, 290 Ark. 616, 719 S.W.2d 436 (1986). See Deaver v. Faucon
Props., Inc., 367 Ark. 288, 239 S.W.3d 525 (2006). We also observe that section 16-62-105
was repealed by Act 1148 of 2013.
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appeal. McDonald v. Petty, 254 Ark. 705, 496 S.W.2d 365 (1973). In McDonald, we wrote,
Although the appellees reserved the right to object to the revivor action, no objection
was ever raised until after the cause reached this court on appeal. Therefore, since this
issue is presented for the first time on appeal, we do not reach it. Griffith v. Rozell, 252
Ark. 280, 478 S.W.2d 762 (1972).
Id. at 710, 496 S.W.2d at 368.
Similarly, in Bulsara v. Watkins, 2012 Ark. 108, 387 S.W.3d 165, the appellee filed a
motion to dismiss the appeal in which she argued that the notice of appeal filed by the
appellant personal representative was a nullity because the personal representative had been
discharged when the notice of appeal was filed. We denied the motion to dismiss, holding
that the discharge did not bar the personal representative’s ability to obtain a final order or to
prosecute the appeal. In reaching that decision, we quoted our previous decision in Bailey v.
Rockafellow, 57 Ark. 216, 21 S.W. 227 (1893), where this court said,
The first question to be decided is raised by the contention of appellees to the effect
that Bailey had no right to prosecute the action as administrator after his discharge.
Regularly the action should have been revived in the name of the proper parties, but
the court did not lose jurisdiction of it. The discharge was no bar to the action. The
defendants could have taken advantage of it by a supplemental answer in the nature of
a plea in abatement. But they had a right to waive it, and permit the cause to be tried
upon its merits, without revivor, and did so with notice of the fact, by a failure to
plead it in any manner. Spalding v. Wathen, 7 Bush, 659; Mansf. Dig. §§ 5028, 5031.
Bailey, 57 Ark. at 218–19, 21 S.W. at 228.
In this case, Ronnie made no formal request for substitution within the one-year
limitations period. However, Ronnie, as the special personal representative of the estate,
defended the motions to dismiss that were based on Bobby’s disqualification and later sought
reconsideration of the dismissal orders. In his pleadings, Ronnie was named as the plaintiff
in the case. The circuit court listed Ronnie as the plaintiff in the case in the dismissal orders
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of October 17, 2011, and June 21, 2012. Likewise, the judgment containing the Rule 54(b)
certificate entered on November 26, 2012, named Ronnie as the plaintiff. Thus, beginning
with his August 15, 2011 response to the motion to dismiss, Ronnie undertook the
prosecution of this case, and the circuit court’s orders reflect this fact. Although the answers
to the second amended complaint, dated October 24, 2001, and November 7, 2011,
mentioned that no substitution had taken place under the Arkansas Rules of Civil Procedure,
appellees “reserve[d]” their objections to Ronnie’s standing as the plaintiff. At the January
31, 2012 hearing, the lack of substitution was discussed only briefly as an alternative argument
to the statute-of-limitations issue. We note that these answers were filed and that the hearing
took place well before the expiration of the one-year limitations period. When that period
came to an end, appellees raised no objection. In particular, appellees did not argue that
Ronnie lacked standing in opposition to the entry of the judgement and the Rule 54(b)
certificate that allowed an appeal to proceed in the absence of a final order. Under these
circumstances, we conclude that appellees waived this issue, and we decline to dismiss the
appeal.
Having concluded that appellees waived this issue, we necessarily reject their
contention that Ronnie’s failure to formally substitute deprives this court of subject-matter
jurisdiction because he lacks standing to pursue an appeal. Subject-matter jurisdiction is
always open, cannot be waived, can be questioned for the first time on appeal, and is a matter
this court is obliged to raise on its own when the parties do not. Jonesboro Healthcare Ctr.,
LLC v. Eaton-Moery Envtl. Servs., Inc., 2011 Ark. 501, 385 S.W.3d 797. Our law is clear that
substitution can be waived and that it is an issue that we need not address for the first time on
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appeal. Speer, supra; McDonald, supra. Because substitution can be waived and may not be
raised for the first time on appeal, it follows that the failure to substitute does not call into
question the jurisdiction of this court.
Pivoting to the issue raised on appeal, Ronnie contends that the circuit court erred in
concluding that the actions taken by Bobby when he served as special personal representative
were invalid and that the complaints Bobby filed were nullities. Ronnie asserts that Bobby’s
appointment was merely voidable but not void, and in making this argument, he refers us to
Arkansas Code Annotated section 28-48-105(b) (Repl. 2012), and our decision in Nickles v.
Wood, 221 Ark. 630, 255 S.W.2d 433 (1953). In support of the circuit court’s decision,
appellees rely on caselaw where complaints filed by personal representatives were considered
nullities when the personal representatives were not empowered to act when the lawsuits
were initiated. For instance, in Brown, supra, the court of appeals held that an amended
complaint was a nullity because the special personal representative was appointed for a limited
time, and the amendment was filed after the time period had expired. Also, in Hubbard v.
National Healthcare of Pocahontas, Inc., 371 Ark. 444, 267 S.W.3d 573 (2007), the administratrix
filed suit before the order appointing her was entered, and thus the complaint she filed was
deemed a nullity. Likewise, in Johnson v. Greene Acres Nursing Home Association, 364 Ark. 306,
219 S.W.3d 138 (2005), the executor of the estate had been discharged. Although the
executor had filed a motion to reopen the estate, the circuit court had not acted on the
motion at the time the executor filed the complaint. Therefore, this court held that the
complaint filed by the executor was a nullity. Ronnie responds that these cases are
distinguishable because, here, Bobby had been appointed as the special personal representative
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by the probate court when he filed the complaints.
The argument that Ronnie advances on appeal is the same one that is raised in the
companion case being handed down this same day, Estate of Taylor v. MCSA, LLC, 2013 Ark.
___, ___ S.W.3d ___, where this court held that Bobby’s acts as special personal
representative were valid and that his appointment was not void ab initio. Based on the
analysis and reasoning explained in that case, we also reverse and remand in this case. In light
of this disposition, we need not reach Ronnie’s alternative argument regarding the statute of
limitations, as the complaints filed by Bobby were not untimely under either limitations
period.
Reversed and remanded.
HART, J., not participating.
Murphy, Thompson, Arnold, Skinner & Castleberry, by: Tom Thompson and Casey
Castleberry; Davidson Law Firm, by: Scott Davidson; and Brian G. Brooks, Attorney at Law, PLLC,
by: Brian G. Brooks, for appellant.
Anderson, Murphy & Hopkins, L.L.P., by: Jason J. Campbell, Mark D. Wankum, and Kyle
E. Burton; and Kutak Rock, by: Jeff Fletcher, for appellees.
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