Walter Gray and Associates, Inc. v. Rankin Insurance Agency, Inc.

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May 12, 2004


[NO. CIV-01-647-1]




John Mauzy Pittman, Judge

The appellee, Rankin Insurance Agency, Inc., filed a complaint alleging, inter alia, that appellant Walter Gray & Associates, Inc., operated a trucking company under the name of "Phantom Express" that purchased insurance policies through appellee's agency; that policies insuring vehicles employed in that business were in fact issued; and that appellant was liable for unpaid premiums on those policies. Appellee subsequently filed a motion for summary judgment against appellant alleging that there was no material issue of fact regarding appellant's liability for the insurance premiums. After a hearing, the trial judge granted the motion and entered judgment for appellee on the account balance of $45,078.09, plus interest, costs, and attorney's fees. From that decision, comes this appeal.

For reversal, appellant asserts that genuine issues of material fact still remained to be decided, and contends that the trial court therefore erred in granting summary judgment. We do not agree, and we affirm.

Rule 56 of the Arkansas Rules of Civil Procedure governs disposition of summary-judgment cases and states, in pertinent part:

(c) Motion and Proceedings Thereon. (1) The motion shall specify the issue or issues on which summary judgment is sought and may be supported by pleadings, depositions, answers to interrogatories and admissions on file, and affidavits. . . . (2) The judgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, shows 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 on the issues specifically set forth in the motion.

. . . .

(e) Form of Affidavits; Further Testimony; Defense Required. Supporting and opposing affidavits shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify to the matters stated therein. Sworn or certified copies of all papers or parts thereof referred to in an affidavit shall be attached thereto or served therewith. The court may permit affidavits to be supplemented or opposed by depositions, answers to interrogatories, or further affidavits. When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his pleadings, but his response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial. If he does not so respond, summary judgment, if appropriate, shall be entered against him.

On appeal, we decide if the grant of summary judgment was appropriate based on whether the evidentiary items presented by the moving party in support of the motion left a material question of fact unanswered. Development & Construction Management, Inc. v. North Little Rock, ___ Ark. App. ___, 119 S.W.3d 77 (2003). The burden of sustaining a motion for summary judgment is on the movant. Wingfield v. Contech Construction Products, Inc., ___ Ark. App. ___, 115 S.W.3d 336 (2003). All proof submitted must be viewed in the light most favorable to the party resisting the motion, and any doubts or inferences are resolved against the moving party. Id. Once the moving party has established a prima facie entitlement to summary judgment by affidavits or other supporting documents, the opposing party must meet proof with proof and demonstrate the existence of a material issue of fact. Id. Summary judgment is appropriate under Ark. R. Civ. P. 56(c) when there is no genuine issue as to a material fact and when the moving party is entitled to summary judgment as a matter of law. Id.

Under prior law, summary judgment was somewhat disfavored and was viewed as a "drastic remedy." This is no longer the case. As Justice Lavenski Smith said in Flentje v. First National Bank of Wynne, 340 Ark. 563, 11 S.W.3d 531 (2000):

[W]e will not engage in a "sufficiency of the evidence" determination. We have ceased referring to summary judgment as a drastic remedy. We now regard it simply as one of the tools in a trial court's efficiency arsenal; however, we only approve the granting of the motion when the state of the evidence as portrayed by the pleadings, affidavits, discovery responses, and admission on file is such that the nonmoving party is not entitled to a day in court, i.e., when there is not any genuine remaining issue of fact and the moving party is entitled to judgment as a matter of law. However, when there is no material dispute as to the facts, the court will determine whether "reasonable minds" could draw "reasonable" inconsistent hypotheses to render summary judgment inappropriate. In other words, when the facts are not at issue but possible inferences therefrom are, the court will consider whether those inferences can be reasonably drawn from the undisputed facts and whether reasonable minds might differ on those hypotheses.

Id. at 570, 11 S.W.3d at 536 (internal citations omitted).

In the present case it is undisputed that appellant, Walter Gray & Associates, Inc., an Arkansas corporation, bought tractors and trailers and engaged in a trucking business under the name Phantom Express between February and December of 2001. Appellant vested authority in Mike Kindellan to operate the trucking company. Mr. Kindellan had both the authority and the responsibility to obtain insurance for the trucking company's equipment. Mr. Kindellan did arrange for such insurance through appellee's insurance agency. Appellee issued certificates of insurance that were faxed to appellant's office. Those insurance policies provided the cargo, liability, and physical damage coverage necessary to operate the trucking company from February through June 2001. Additional liability and physical damage policies and coverage were provided by appellee to appellant's trucking business in March 2001 at the request of Mr. Kindellan. All of the policies were canceled by June 2001 for nonpayment of premiums. The amount of the unpaid premiums totaled $51,917.16. Appellant was entitled to a credit of $6,649.20 for premium payments made by a predecessor entity, and a deduction of approximately $189.00 for insurance covering a mobile home not used in the trucking business.

Appellant argues that summary judgment was improper because questions remain regarding certain facts concerning the predecessor entity to which the insurance policies were originally issued. Although appellant is correct in his assertion that the relationship between the various parties, individuals, and entities in this case is not entirely clear, we agree with the trial court's assessment that this lack of clarity is largely due to a lack of forthrightness on the part of appellant concerning requested discovery. Furthermore, insomuch as the debt for which appellant was found liable undisputedly arose from the provision of insurance coverage for appellant's trucking business, equipment, and operations at the request of an employee of appellant who admittedly was authorized and obliged to obtain such coverage, we cannot say that reasonable minds could differ on the inferences to be drawn from the undisputed facts. See Flentje v. First National Bank of Wynne, supra.


Robbins and Bird, JJ., agree.