Harvie Anglin v. Johnson Regional Medical Center
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SUPREME COURT OF ARKANSAS
No.
08-453
HARVIE ANGLIN,
Opinion Delivered November
6, 2008
APPELLANT,
VS.
JOHNSON REGIONAL MEDICAL CENTER,
APPELLEE,
APPEAL FROM THE JOHNSON COUNTY
CIRCUIT COURT,
NO. CV2006-119,
HON. DENNIS CHARLES SUTTERFIELD,
JUDGE,
AFFIRMED.
JIM HANNAH, Chief Justice
1.
TORTS — CHARITABLE IM M UNITY — EIGHT FACTORS. — To determine whether an organization
is entitled to charitable immunity, courts consider the following factors set forth in George v.
Jefferson Hospital Ass’n: (1) whether the organization’s charter limits it to charitable or
eleemosynary purposes; (2) whether the organization’s charter contains a “not-for-profit” limitation;
(3) whether the organization’s goal is to break even; (4) whether the organization earned a profit;
(5) whether any profit or surplus must be used for charitable or eleemosynary purposes; (6)
whether the organization depends on contributions and donations for its existence; (7) whether the
organization provides its services free of charge to those unable to pay; and (8) whether the
directors and officers receive compensation; these factors are illustrative, not exhaustive, and no
single factor is dispositive of charitable status.
2.
TORT S —
GEORGE WERE
CLEARLY ESTABLISHED BASED UPON EVIDENCE IN THE RECORD. — Of the eight factors listed in
George, three were clearly established based upon evidence in the record; those are (1) whether
the organization’s charter limits it to charitable or eleemosynary purposes; (2) whether the
organization’s charter contains a “not-for-profit” limitation; and (7) whether the organization
provides its services free of charge to those unable to pay; the first and second were demonstrated
by appellee’s articles of incorporation, which state that the hospital provides health services on a
charitable, not-for-profit basis; the seventh factor was established by the hospital administrator’s
affidavit, wherein he stated that the hospital provides health services free of charge to those who
cannot pay and that during the first nine months of 2007, appellee provided $849,043 in free
CHARITABLE IM M UNITY
—
THREE OF THE FACTORS SET FORTH IN
medical services.
3.
TORTS —
— IN SOM E YEARS, APPELLEE EARNED A PROFIT , AND IN
OTHERS IT DID NOT . — As to the fourth George factor, whether the organization earned a profit,
the record showed that in some years, appellee did earn a profit, and in others, it did not; the
hospital administrator’s affidavit established that appellee was currently operating at a loss.
4.
TORTS — CHARITABLE IM M UNITY — RECORD ESTABLISHED THAT ANY SURPLUS SHALL BE USED
CHARITABLE IM M UNITY
TO FUND THE HOSPITAL TO FULLY PERPETU A T E ITS CHARITABLE COM M UNITY BENEFIT OF
— Appellee satisfied fifth George factor,
whether any profit or surplus must be used for charitable or eleemosynary purposes, because the
hospital administrator’s affidavit stated that any surplus shall be used to fund the hospital to fully
perpetuate its charitable community benefit of providing medical assistance to the public.
PROVIDING M ED ICA L ASSISTANCE TO THE PUBLIC.
5.
TORTS —
CHARITABLE IM M UNITY
—
RECORD SHOWED T H A T A P P ELLEE’S GOAL IS TO NOT
OPERATE AT A LOSS AND TO USE ANY SURPLUS TO FUND IM PROVEM ENTS FOR THE HOSPITAL.
—
As to the third George factor, whether the hospital’s goal is to break even, it appears from the
record that appellee’s goal is to not operate at a loss and to use any surplus to fund improvements
for the hospital.
6.
TORTS —
CHARITABLE IM M UNITY
—
IT D ID N OT APPEAR THAT APPELLEE DEPENDS ON
CONTRIBUTIONS AND DONATIONS FOR ITS EXISTENCE. — As for the sixth George
factor, whether
the organization depends on contributions and donations for its existence, it did not appear that
appellee depends on these types of funding for its existence, as the hospital services are paid for
by insurance companies, whether governmental or private.
7.
TORTS —
CHARITABLE IM M UNITY
—
ARTICLES OF INCORPORATIO N ST ATE DIRECTORS AND
OFFICERS CAN RECEIVE REASONABLE COM PENSATION, BUT SHALL RECEIVE NO PART OF
— As for the eighth George factor, whether the directors and officers
receive compensation, the articles of incorporation state that the directors and officers can receive
reasonable compensation, but that they shall receive no part of the net earnings.
APPELLEE’S NET EARNINGS.
8.
TORTS — CHARITABLE IM M UNITY — FACT THAT HOSPITAL ANTICIPATED THAT IT M IGHT M AKE
A PROFIT WAS NOT DISPOSITIVE. — Trying to break even is only one factor and certainly not a
dispositive one when applied to a hospital; modern hospitals are complex and expensive,
technological, economic and medical enterprises that can ill afford to come short of even in their
financial integrity; running a small surplus should not be seen as totally incompatible with charitable
status in such cases; the existence of a profit is not determinative of charitable status; here, it was
evident that appellee anticipated that it might make a profit, as demonstrated by the administrator’s
statement that the hospital intended to use any surplus to perpetuate its purpose of providing
healthcare for the benefit of the community; appellant’s suggestion that appellee is not a charity
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9.
10.
hospital because it has in some years earned a profit was therefore rejected.
TORTS — CHARITABLE IM M UNITY — FACT THAT APPELLEE SUES PATIENTS TO COLLECT UNPAID
M EDICAL BILLS WAS NOT DETERM INATIVE OF ITS CHARITABLE STATUS. — The fact that appellee
sues patients to collect unpaid medical bills was not determinative of its status; appellant failed to
show that in filing suit to collect unpaid bills, appellee was attempting to collect from patients unable
to pay; this left only the evidence from appellee that suit is instituted only against those able to pay
but who refuse to do so.
TO RT S —
CH ARITABLE IM M UNITY
—
CIRCUIT COURT DID NOT ERR IN CONCLUDING THA T
APPELLEE M ET THE REQUIREM ENTS OF A CHARITABLE ENTITY FOR PURPOSES OF ASSERTING THE
DEFENSE OF THE CHARITABLE- IM M UNITY DOCTRINE.
— Based upon a review of the totality of
the relevant facts and circumstances, and the fact that appellant did not refute appellee’s
overwhelming evidence supporting its contention that it met the standard governing charitable
immunity under Arkansas law, the supreme court held that the circuit court did not err in concluding
that appellee met the requirements of a charitable entity for purposes of asserting the defense of the
charitable-immunity doctrine.
11.
COURTS —
— SU P REM E COURT DECLINED TO
PROSPECTIVELY APPLY ITS DECISION IN LOW V. INSURANCE CO. OF NORTH AMERICA WHERE ONEYEAR SAVINGS STATUTE A P P LICA BLE TO APPELLANT ’S COM PLAINT EXPIRED EIGHT M ONTHS
AFTER LOW DECISION. — In Felton v. Rebsamen Medical Center, the supreme court rejected
the appellant’s argument that it should apply its decision in Low prospectively where the appellant
in that case had more than two months in which to refile a claim against a charitable defendant’s
insurance company in accordance with the law in Low; here, the one- year savings statute
applicable to appellant’s complaint expired some eight months after the supreme court’s decision
in Low; accordingly, the supreme court declined to prospectively apply the Low decision in this
case.
12.
CIVIL PROCEDURE — RELATION- BACK DOCTRINE — INAPPLICABLE WHERE COM PLAINT WAS A
NULLITY. — Where the complaint is a nullity, the relation-back doctrine is inapplicable because
there is no pleading to amend and nothing to relate back; here, pursuant to the supreme court’s
holding in Low v. Insurance Co. of North America, appellant was required to file a direct cause
of action against the insurer of an institution entitled to charitable immunity; the complaint filed the
day the savings statute expired failed to include the insurer, and was therefore a nullity; appellant’s
subsequent first amended complaint, which attempted to name the hospital’s liability insurance
carrier as a defendant, was time-barred; accordingly, the circuit court did not err in concluding that
the relation-back doctrine was inapplicable.
13.
JUDGM ENT —
PROSPECTIVE APPLICATION OF CASE LAW
SUM M ARY JUDGM ENT
—
ISSU ES REGARDING APPELLEE’S PROFIT AND ITS
PRACTICE OF FILING SUIT TO COLLECT UNPAID M EDICAL BILLS WERE NOT M ATTERS OF DISPUTED
FACT , BUT RATHER DIFFERING LEGAL INTERPRETA T IO N S OF UNDISPUTED FACTS
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—
CIRCUIT
08-453
COURT CORRECTLY DETERM INED, AS A M ATTER OF LAW, THAT APPELLEE WAS A CHARITY
ENTITLED TO IM M UNITY. — Where there are no disputed facts regarding a defendant’s
charitable
status, the determination of charitable status is a question of law for the court; here, the issues
regarding appellee’s profit and its practice of filing suit to collect unpaid medical bills were not
matters of disputed fact, but rather they were differing legal interpretations of undisputed facts;
therefore, in this case, because no disputed facts existed, the circuit court correctly determined, as
a matter of law, that appellee was a charity entitled to immunity.
14.
CONSTITUTIONAL LAW —
RIGHT TO JURY TRIAL
—
BECAUSE NO FACTUAL ISSUES EXISTED,
APPELLANT WAS NOT UNCONSTITUTIONALLY DENIED HIS RIGHT TO A JURY TRIAL.
— The right
to a jury trial under the Arkansas Constitution extends only to the trial of issues of fact in civil and
criminal causes; thus, where there is no factual dispute, there is no constitutional right to a trial by
jury; because no factual issues existed in this case, appellant was not unconstitutionally denied his
right to a jury trial.
Law Offices of Charles Karr, P.A., by: Charles Karr, for appellant.
Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C., by: Stuart P. Miller, for appellee.
Appellant Harvie Anglin appeals the order of the Johnson County Circuit Court granting
summary judgment in favor of appellee Johnson Regional Medical Center (JRMC). On appeal,
he asserts that the circuit court erred in determining that JRMC was entitled to charitable
immunity and in determining that it was not necessary to address the issue of governmental
immunity. Mr. Anglin also contends that the circuit court erred in concluding that his amended
complaint could not relate back to the date of the original complaint pursuant to Rule 15(c)
of the Arkansas Rules of Civil Procedure.
Finally, Mr. Anglin contends that the circuit court
erred in declaring that Rule 56 of the Arkansas Rules of Civil Procedure is constitutional. We
affirm the circuit court.
Harvie and Margie Anglin filed a lawsuit on February 6, 2003, as husband and wife,
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against JRMC and AIG Insurance Company (AIG), based upon allegations of medical injuries
sustained by Mrs. Anglin as a result of the alleged negligence of JRMC that occurred on
January 24, 2003. Mrs. Anglin later died, and Mr. Anglin filed a motion to revive the original
action after being appointed special administrator of his wife’s estate.
On April 14, 2003, the
circuit court ordered the substitution of Mr. Anglin as the party of interest and granted the
motion for revival. Mr. Anglin then pursued a wrongful death claim on behalf of his deceased
wife.
On April 22, 2003, Mr. Anglin nonsuited AIG, and an order dismissing AIG without
prejudice was entered.
On December 5, 2003, Mr. Anglin filed a First Amended Complaint against JRMC and
TIG Insurance Company (TIG).
Mr. Anglin voluntarily nonsuited the action, dismissing it
without prejudice, on August 1, 2005.1 On August 1, 2006, Mr. Anglin filed a complaint based
on the same allegations, but he named only JRMC as a defendant.
On November 19, 2007, JRMC filed a motion for summary judgment, contending that
JRMC was entitled to both governmental and charitable immunity.
In addition, JRMC asserted
that Mr. Anglin’s complaint, filed on August 1, 2006, in accordance with the savings statute,
was a nullity because he failed to name the proper defendant, TIG, JRMC’s liability insurer.
Mr. Anglin responded to the motion for summary judgment and asserted that Rule 56
was unconstitutional and that JRMC was not entitled to either governmental or charitable
1
While the order of dismissal does not specifically mention TIG, the order
dismissed the entire action without prejudice, and there is nothing in the record indicating
that TIG was dismissed prior to August 1, 2005.
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immunity.
After a hearing on the motion, the circuit court entered an order granting JRMC’s
motion for summary judgment and dismissing with prejudice Mr. Anglin’s complaint against
JRMC.
The circuit court concluded that JRMC was entitled to charitable immunity and that
because Mr. Anglin did not sue the liability insurer directly, his complaint was a nullity.
Further, the circuit court determined that Rule 56 was constitutional.
Mr. Anglin now brings
this appeal.
Mr. Anglin asserts that the circuit court erred in granting summary judgment on the
basis that JRMC was entitled to charitable immunity.
The law is well settled that summary
judgment is to be granted by a circuit court only when it is clear that there are no genuine
issues of material fact to be litigated, and the party is entitled to judgment as a matter of law.
See Stromwall v. Van Hoose, 371 Ark. 267, 265 S.W.3d 93 (2007). Once the moving party
has established a prima facie entitlement to summary judgment, the opposing party must meet
proof with proof and demonstrate the existence of a material issue of fact.
See id.
On
appellate review, we determine if summary judgment was appropriate based on whether the
evidentiary items presented by the moving party in support of the motion leave a material fact
unanswered. See id. We view the evidence in a light most favorable to the party against whom
the motion was filed, resolving all doubts and inferences against the moving party.
See id. Our
review focuses not only on the pleadings, but also on the affidavits and documents filed by the
parties. See id.
“The essence of the [charitable-immunity] doctrine is that agencies, trusts, etc., created
and maintained exclusively for charity may not have their assets diminished by execution in
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favor of one injured by acts of persons charged with duties under the agency or trust.” George
v. Jefferson Hosp. Ass’n, 337 Ark. 206, 211, 987 S.W.2d 710, 712 (1999) (citing Crossett
Health Ctr. v . Croswell, 221 Ark. 874, 256 S.W.2d 548 (1953)). The doctrine favors charities
and results in a limitation of potentially responsible persons whom an injured party may sue.
Id.
Therefore, we give the doctrine a very narrow construction.
Id. (citing Williams v.
Jefferson Hosp. Ass’n, 246 Ark. 1231, 442 S.W.2d 243 (1969)). To determine whether an
organization is
entitled
to
charitable immunity,
courts consider the following factors:
(1) whether the organization’s charter limits it to charitable or eleemosynary
purposes; (2) whether the organization’s charter contains a “not-for-profit”
limitation; (3) whether the organization’s goal is to break even; (4) whether the
organization earned a profit; (5) whether any profit or surplus must be used for
charitable or eleemosynary purposes; (6) whether the organization depends on
contributions and donations for its existence; (7) whether the organization
provides its services free of charge to those unable to pay; and (8) whether the
directors and officers receive compensation.
Id. at 212, 987 S.W.2d at 713.
These factors are illustrative, not exhaustive, and no single
factor is dispositive of charitable status. Id.
In support of its motion for summary judgment, JRMC presented the affidavit of its
administrator, Larry Morse. Mr. Morse stated that JRMC treats patients and provides medical
services free of charge, without regard for the patients’ ability to pay.
He also stated that
JRMC’s charter limits it to charitable purposes and establishes it as a not-for-profit entity.
Mr. Morse further explained that JRMC is exempt from the payments of federal and state
income taxes because it is a 501(c)(3) corporation existing, organized, and operated for
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charitable purposes.
Mr. Morse also stated that JRMC derives its funds primarily from
Medicare, Medicaid, and individual patients or their private insurers.
Mr. Morse stated that, as of September 30, 2007, JRMC had provided approximately
$849,043 in free medical services for the year.
He also stated that JRMC currently
experiences an operating margin of (9.78%), indicating a loss from operations.
Along with Mr. Morse’s affidavit, JRMC submitted its articles of incorporation, which
state that JRMC shall provide health services on a charitable basis and not for profit, but that
nothing shall be deemed to require JRMC to furnish services without charge to those able to
pay the charges either directly or through third parties.
In addition, the articles of
incorporation state that no part of the net earnings of JRMC shall inure to the benefit of or be
distributable to its members, trustees, officers, or other private persons, except that JRMC
shall be authorized and empowered to pay reasonable compensation for services rendered.
In response to JRMC’s pleadings accompanying the motion for summary judgment, Mr.
Anglin presented the deposition of Mr. Morse.
Citing Mr. Morse’s deposition, Mr. Anglin
claims that JRMC is not entitled to charitable immunity because it is not maintained
exclusively for charity. He states that JRMC is a “big business,” and that, while the hospital
did not make a profit in 2006, it made profits in excess of $1 million in years prior to 2006.
Mr. Anglin also asserts that JRMC is not a charity because it sues patients to collect unpaid
hospital bills.
Finally, Mr. Anglin contends that, by virtue of the fact that JRMC carries
liability insurance, it is a business and not a charity.
Of the eight factors listed in George, three are clearly established based upon evidence
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in the record.
Those are: (1) whether the organization’s charter limits it to charitable or
eleemosynary purposes; (2) whether the organization’s charter contains a “not-for-profit”
limitation; and (7) whether the organization provides its services free of charge to those unable
to pay.
The first and second are demonstrated by JRMC’s articles of incorporation, which
state that the hospital provides health services on a charitable, not- for- profit basis. The seventh
factor is established by Mr. Morse’s affidavit, wherein he stated that the hospital provides
health services free of charge to those who cannot pay.
As noted, in the first nine months of
2007, JRMC provided $849,043 in free medical services.
As to the fourth factor, whether the organization earned a profit, the record shows that
in some years, JRMC did earn a profit, and in others, it did not.
Mr. Morse’s affidavit
established that JRMC is currently operating at a loss. JRMC satisfies the fifth factor, whether
any profit or surplus must be used for charitable or eleemosynary purposes, because Mr.
Morse stated any surplus shall be used to fund the hospital to fully perpetuate its charitable
community benefit of providing medical assistance to the public.
As for the third factor, whether the hospital’s goal is to break even, it appears from the
record that JRMC’s goal is to not operate at a loss and to use any surplus to fund improvements
for the hospital. As for the sixth factor, whether the organization depends on contributions and
donations for its existence, it does not appear that JRMC depends on these types of funding
for its existence, as the hospital services are paid for by insurance companies, whether
governmental or private.
As for the eighth factor, whether the directors and officers receive
compensation, the articles of incorporation state that the directors and officers can receive
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reasonable compensation, but that they shall receive no part of the net earnings.
The circuit court found that Mr. Anglin’s response to JRMC’s motion for summary
judgment did not refute JRMC’s overwhelming evidence supporting its contention that JRMC
meets the standard governing charitable immunity under Arkansas law. We agree.
Mr. Anglin appears to suggest that JRMC is not a charity hospital because it has in some
years earned a profit. Indeed, it is evident that JRMC anticipated that it might make a profit,
as demonstrated by Mr. Morse’s statement that the hospital intended to use any surplus to
perpetuate its purpose of providing healthcare for the benefit of the community.
In George,
we explained:
[T]rying to break even is only one factor and certainly not a dispositive one when
applied to a hospital. Modern hospitals are complex and expensive,
technological, economic and medical enterprises that can ill afford to come
short of even in their financial integrity. Running a small surplus should not be
seen as totally incompatible with charitable status in such cases. . . . The
existence of profit is not determinative of charitable status.
337 Ark. at 213, 987 S.W.2d at 713.
Further, the fact that JRMC sued patients to collect unpaid medical bills is not
determinative of its charitable status.
Mr. Anglin failed to show that in filing suit to collect
unpaid bills, JRMC was attempting to collect from patients unable to pay.
This leaves only the
evidence from JRMC that suit is instituted only against those able to pay but who refuse to do
so.
Based upon a review of the totality of the relevant facts and circumstances, we hold that
the circuit court did not err in concluding that JRMC meets the requirements of a charitable
entity for purposes of asserting the defense of the charitable- immunity doctrine.
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affirm the circuit court’s determination that JRMC is charitably immune from suit, we need
not address Mr. Anglin’s argument regarding governmental immunity.
Mr. Anglin asserts that even if JRMC is immune from tort liability, he may still sue
JRMC’s liability insurer.
He contends that the circuit court erred in concluding that his first
amended complaint, which named TIG Insurance Company as a defendant, could not relate back
to the date of the original complaint. 2
The record reveals that Mr. Anglin filed his complaint
against JRMC on August 1, 2006, exactly one year after he had nonsuited his first amended
complaint, which he had filed on December 5, 2003.3
At the time Mr. Anglin refiled suit, on
August 1, 2006, Low v. Insurance Co. of North America, 364 Ark. 427, 220 S.W.3d 670
(2005), was the law regarding the issue of charitable immunity, and the Low decision
specifically required Mr. Anglin to file a direct cause of action against the insurer of an
institution entitled to charitable immunity.
Nevertheless, Mr. Anglin did not name the liability
insurance carrier of JRMC in his complaint filed August 1, 2006, despite the fact that the Low
decision was delivered on December 15, 2005, prior to the expiration of Mr. Anglin’s savings
limitations period, which ran on August 1, 2006.
In other words, Mr. Anglin had more than
eight months in which to refile his claim against the liability insurance carrier, TIG, in accord
with the law as stated in Low.
We have previously rejected an appellant’s argument that we apply our decision in
2
Mr. Anglin filed a first amended complaint naming TIG as a defendant on December
18, 2007.
3
The December 5, 2003 complaint named both JRMC and TIG as defendants.
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Low prospectively in a case where the appellant had more than two months in which to refile
a claim against a charitable defendant’s insurance company in accordance with the law in Low.
See Felton v. Rebsamen Med. Ctr., 373 Ark. 472, ___ S.W.3d ___ (2008).
Mr. Anglin
acknowledges the Felton decision; however, he claims his case is distinguishable from
Felton, because in his case, the one-year savings statute expired before this court decided Low.
Mr. Anglin is mistaken.
As noted above, the one- year savings statute expired on August 1,
2006, some eight months after our decision in Low.
Mr. Anglin’s first amended complaint, filed on December 18, 2007, in an attempt to
name the hospital’s liability insurance carrier as a defendant, is time-barred, and despite his
suggestion to the contrary, the relation-back doctrine is inapplicable.
Pursuant to our holding
in Low, Mr. Anglin was required to file a direct cause of action against the insurer of an
institution entitled to charitable immunity.
The complaint filed on August 1, 2006, the day the
savings statute expired, failed to include the insurer.
Therefore, that complaint was a nullity.
Where the complaint is a nullity, the relation-back doctrine is inapplicable because there is no
pleading to amend and nothing to relate back. See Brewer v. Poole, 362 Ark. 1, 207 S.W.3d
458 (2005).
Accordingly, the circuit court did not err in concluding that the relation-back
doctrine was inapplicable.
Finally,
Mr.
Anglin contends
that
Arkansas Rule of Civil Procedure 56
is
unconstitutional because it denies him his right of trial by jury as guaranteed by the Arkansas
Constitution.
In this case, the circuit court determined that JRMC was entitled to summary
judgment as matter of law because it was immune from suit due to its charitable immunity. Mr.
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Anglin asserts that Rule 56 “encroaches on the right to trial by jury because it requires a party
to demonstrate that there are genuine issues of material fact, or the case will be decided by the
trial judge without a jury trial.” He states that nothing in the Arkansas Constitution states that
the right to a trial by jury extends only to those cases in which there are factual disputes.
Further, Mr. Anglin contends that the issue of whether a hospital is entitled to a defense of
governmental or charitable immunity is a question of fact for the jury to decide.
Accordingly,
Mr. Anglin asserts that the circuit court’s final judgment granting JRMC’s motion for summary
judgment pursuant to Rule 56 was unconstitutional because he was not afforded the right to
have these fact questions heard by a jury.
Article 2, section 7 of the Arkansas Constitution
provides in relevant part:
The right of trial by jury shall remain inviolate, and shall extend to all cases at
law, without regard to the amount in controversy; but a jury trial may be waived
by the parties in all cases in the manner prescribed by law; and in all jury trials
in civil cases, where as many as nine of the jurors agree upon a verdict, the
verdict so agreed upon shall be returned as the verdict of such jury, provided,
however, that where a verdict is returned by less than twelve jurors all the jurors
consenting to such verdict shall sign the same.
The right to a jury trial under this provision is a fundamental right.
Craven v. Fulton
Sanitation Serv., Inc., 361 Ark. 390, 206 S.W.3d 842 (2005); Walker v. First Commercial
Bank, N.A., 317 Ark. 617, 880 S.W.2d 316 (1994). This right extends to all cases that were
triable at common law.
(1997).
Craven, supra; Hopper v. Garner, 328 Ark. 516, 944 S.W.2d 540
That is, the constitutional right to trial by jury extends only to the trial of issues of
fact in civil and criminal causes.
6 (1979).
Craven, supra; Jones v. Reed, 267 Ark. 237, 590 S.W.2d
Thus, where there is no factual dispute, there is no constitutional right to a trial by
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jury.
Mr. Anglin maintains that the question of whether JRMC is entitled to charitable
immunity is a question of material fact that entitles him to a jury trial.
In support of this
argument, he cites Crossett Health Center v. Croswell, 221 Ark. 874, 256 S.W.2d 548
(1953).
Croswell is distinguishable from the instant case because there were disputed facts
concerning whether the hospital was a charity. In that case, there was evidence that the hospital
had been given land, funds, and furnishings by a lumber company that had an interest in the
hospital.
Moreover, the articles of incorporation provided that, upon liquidation of the
hospital, the assets could be distributed by the board of governors in any manner consistent
with state laws. Here, Mr. Anglin claims that because JRMC earned a profit in some years and
because JRMC sues to collect unpaid medical bills, he has the right to present to the jury the
question of whether JRMC is a charity that is immune from suit.
Where there are disputed facts concerning an organization’s charitable status, those
facts should be presented to the jury. See Croswell, supra. On the other hand, where there
are no disputed facts regarding a defendant’s charitable status, the determination of charitable
status is a question of law for the court. In George, the appellant argued that there were factual
issues with respect to the fourth, fifth, and eighth factors—whether the organization earned a
profit, whether any profit or surplus must be used for charitable or eleemosynary purposes, and
whether the directors and officers receive compensation. We disagreed, stating:
As to the fourth, fifth, and eighth, appellant contends that these are all questions
of fact and must therefore be tried rather than resolved on summary judgment.
We disagree. While there may be fact issues involved, they are not matters of
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disputed fact. Rather, they are differing legal interpretations of undisputed facts.
In such cases, an appellate court should grant summary judgment where
reasonable persons would not reach different conclusions based upon those
undisputed facts. Leigh Winham, Inc. v. Reynolds Ins. Agency, 279 Ark. 317,
651 S.W.2d 74 (1983). When each of the remaining Masterson[4] factors are
analyzed with the relevant undisputed facts, JRMC’s charitable status is
established.
George, 337 Ark. at 212-13, 987 S.W.2d at 713.
Here, the issues regarding JRMC’s profit and its practice of filing suit to collect unpaid
medical bills are not matters of disputed fact, but rather they are differing legal interpretations
of undisputed facts.
Croswell.
See George, supra.
There are no disputed facts, as was the case in
Therefore, in this case, because no disputed facts existed, the circuit court correctly
determined, as a matter of law, that JRMC was a charity entitled to immunity.
Because there
were no genuine issues of material fact, the circuit court did not err in granting summary
judgment. We hold that, because a person is entitled to a jury trial only in the event that there
are factual issues, and none exist in this case, Mr. Anglin was not unconstitutionally denied his
right to a jury trial.
Affirmed.
BROWN, J., dissents.
ROBERT L. BROWN, Justice, dissenting. I would reverse the grant of summary judgment
in this case because the issue of whether Johnson Regional Medical Center (“JRMC”) is a
4
In Masterson v. Stambuck, 321 Ark. 391, 902 S.W.2d 803 (1995), the court
adopted the eight-factor test to determine whether an organization is entitled to charitable
immunity.
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charitable organization entitled to charitable immunity is contested by the parties and presents
a genuine issue of material fact for the jury to resolve. The trap that the majority, and the trial
court before it, fell into was to decide these issues of fact as a “legal interpretation of
undisputed facts,” all of which runs counter to the foundational principle in our jurisprudence
that juries are fact-finders – not the judges.
As an additional matter, I disagree that all of the eight George factors are undisputed
by the parties. See George v. Jefferson Hospital Ass’n, Inc., 337 Ark. 206, 987 S.W.2d 710
(1999).
Harvie Anglin, as the plaintiff in this case, presented proof in deposition form that
JRMC makes a net profit in most years; that it has over six million dollars in reserve funds; that
it is the fourth largest employer in Clarksville; that government or private insurance accounts
for the majority of its income and it receives an insignificant portion from donations; that
charity care accounts for a very small part of the services it provides; that it carries liability
insurance; and that its administrative employees are well paid. That evidence, at the very least,
calls into question whether JRMC’s profit and reserves are used for charitable care and the
extent of free care it offers.
But the main fallacy in the majority opinion is that it seems to claim that, if the parties
agree on the profit amounts and amount of charitable care, there is no genuine issue of material
fact for purposes of deciding charitable immunity.
But that misses the point entirely.
Even
assuming that no one disputes the accuracy of the amount of profit made by JRMC or the total
amount of its reserve funds or the amount of charitable care it gives, the ultimate question is
whether, based on all the factors, JRMC is, in fact, a charity. That is the issue to be resolved
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and that is a factual inquiry. Based on the majority’s reasoning, however, no matter how much
profit a hospital makes and no matter how little it offers in charitable care, as long as the
parties do not contest those amounts, the hospital will never be entitled to a jury trial with
respect to the hospital’s status. That cannot be the law.
In Crossett Health Center v. Croswell, 221 Ark. 874, 883, 256 S.W.2d 548, 552
(1953), this court made the point clearly and undisputedly that it was up to the jury to consider
the factors militating for and against charitable status and to determine whether “the Medical
Center was a trust involving dedication of its property to the public.” Moreover, this court has
made it clear that we give the doctrine of charitable immunity “a very narrow construction.”
Williams v. Jefferson Hosp. Ass’n, Inc., 246 Ark. 1231, 442 S.W.2d 243 (1969). And yet in
analyzing the eight George factors, the majority tilts in favor of JRMC and gives a broad
construction for charitable immunity.
For example, for factor three, which is whether the
hospital’s goal is to break even, JRMC admits that breaking even is not its goal and that any
profit is used to fund hospital improvements.
compensation for directors and officers.
goes solely to charitable care.
Presumably, “improvements” would also include
The point is that there is no suggestion that profit
The majority also announces that JRMC provides $849,043 in
free medical services, which is at odds with Anglin’s deposition proof.
But, in addition, does
Medicare and Medicaid pay for some of this free care? That question is unanswered in the
majority’s opinion.
After today’s decision, it is difficult for me to imagine how any of the George factors
or the issue of charitable immunity itself would ever present an issue for the jury to decide.
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The majority seems to accept JRMC’s figures and to close the door on that ever happening.
As a result, deciding whether the George factors are met, and immunity itself, becomes solely
for judges to resolve as a matter of law.
Again, that is at odds with all of our summary-
judgment jurisprudence when a genuine issue of fact remains to be resolved. In short, whether
an entity is a charity is the material factual inquiry in summary judgment, not a “legal
interpretation,” as the majority would have it. It also bears mentioning that Arkansas is one of
only four states that still provides absolute charitable immunity for its hospitals.
See Janet
Fairchild, Annotation, Tort Immunity of Nongovernmental Charities - Modern Status, 25
A.L.R. 4th 517 (1983 & Supp. 2007).
I would deny the hospital’s motion for summary judgment and remand for a jury trial
on the question of whether JRMC is entitled to charitable immunity.
For these reasons, I
respectfully dissent.
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