Bowling v. Spears

858 S.W.2d 93, 314 Ark. 54, 1993 Ark. LEXIS 441
CourtSupreme Court of Arkansas
DecidedJuly 12, 1993
Docket93-223
StatusPublished
Cited by9 cases

This text of 858 S.W.2d 93 (Bowling v. Spears) is published on Counsel Stack Legal Research, covering Supreme Court of Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Bowling v. Spears, 858 S.W.2d 93, 314 Ark. 54, 1993 Ark. LEXIS 441 (Ark. 1993).

Opinion

Robert L. Brown, Justice.

The claimants and appellants, Jimmy Lee Bowling and Gay Taylor Bowling, filed a claim against the estate of Delbert Allen Spears, deceased, but did so outside of the three-month period under the statute of nonclaim. The probate court denied the claim. The appellants appeal on the basis that they were denied a hearing to present their case. They further contend that they were creditors of the estate who could be reasonably ascertained, and as such, the applicable statute of limitations was two years. Alternatively, they urge that the statutes requiring actual notice to reasonably ascertainable creditors are unconstitutional on their face and as applied in this case. We affirm the probate court’s decision.

The decedent, Delbert Allen Spears, was a licensed real estate broker and a principal owner of Spears and Tisdale Realty Company. He was also an owner of S & T Homes, Inc., a Little Rock housing construction corporation that was used to build housing on property sold through Spears and Tisdale Realty.

On January 3,1989, the decedent and the appellants, Jimmy Lee Bowling and Gay Taylor Bowling, closed two real estate transactions. The decedent took title to the appellants’ land and house located at 8623 Duncan Drive in Little Rock in exchange for a lot owned by Spears and Tisdale Realty, also in Little Rock, and a new house to be constructed on the lot by S & T Homes.1 As part of the consideration for the land swap, the decedent assumed the outstanding balance owed on a note and mortgage on the Duncan Drive property. The decedent, as owner of the Duncan Drive property, continued to make note payments as they came due until May 30, 1990, when he conveyed the property by warranty deed to his brother, John Spears. Eight months later, on February 1, 1991, the decedent’s brother stopped making payments, and the Duncan Drive property went into default.

On May 20,1991, the appellants were notified and demand was made upon them for payment of the note on the Duncan Drive property. Only then were they apprised of the fact that the decedent had died prior to the default on September 21,1990, and that the Duncan Drive property had been conveyed to the decedent’s brother. Notice and demand were presented to the appellee, Skeet Lavonda Renee Spears, administratrix of the decedent’s estate, on June 18,1991. She took no steps to clear the default. As administratrix, she had published the requisite statutory notice in The Benton Courier, a Saline County newspaper, for two consecutive weeks beginning October 22,1990. The three-month statute of nonclaim established by Ark. Code Ann. § 28-50-101(a) (Supp. 1991) expired on January 22, 1991, which was prior to the default.

The Duncan Drive property went into foreclosure, and a deficiency judgment was entered against the appellants and in favor of the holder of the note and mortgage for the amount of $24,314.90. The appellants, in turn, made demand upon the decedent’s estate for payment of the deficiency judgment, but the estate refused payment. The appellants then filed a claim against the estate on June 23,1992, seeking damages in the amount of the deficiency with interest from October 15, 1991, together with exemplary damages for fraud, deceit, and misrepresentation on the part of the decedent.

On July 22, 1992, the estate responded to the claim filed against it, noting that the first inkling it had of a potential claim appeared in a letter from the appellants’ attorney dated June 18, 1991 — more than seven months after the first publication of notice to creditors. Prior to June 18,1992, the estate contends, the claim was neither known to it nor reasonably ascertainable. The burden of proof on the issue, according to the estate, was on the creditor claiming entitlement to actual notice. Denying the claim, the estate requested a hearing before the Saline County Probate Court for a determination of whether the appellants, as creditors, were known or reasonably ascertainable to the administratrix and therefore entitled to more than constructive notice.

On August 20,1992, it is disputed what occurred. The estate asserts that a hearing was held on the claim. The appellants argue that it was in fact a conference among the attorneys and the probate court. On September 29, 1992, before the entry of the order resulting from the August 20,1991 hearing, the appellants filed a motion requesting an evidentiary hearing on all facts still disputed by the estate and raising for the first time the constitutionality of the notice provisions to creditors in the Probate Code. The following day, September 30,1992, the probate court replied by letter that the motion was denied because the appellants had an opportunity to present evidence at the August 20, 1992 hearing and chose not to take it. The afternoon of October 1, 1992, the appellants filed with the Saline County Probate Clerk a proffer of facts and a deposition of the administratrix taken on August 12,1992, in connection with litigation pending in Pulaski County Circuit Court and the decedent’s estate.

In its resulting order, filed on October 2, 1992, the probate court found that notice of appointment of personal representative and notice to creditors was published on October 22, 1990, the three-month limitation on filing claims set forth in the statute of nonclaim, § 28-50-101 (a), ended on January 22, 1991, and the appellants filed their claim on June 23,1992. Because the claim of the appellants was not known to or reasonably ascertainable by the administratrix at the time of first publication of notice, reasoned the court, the requirements of Ark. Code Ann. § 28-40-111(a)(4) (Supp. 1991) concerning notice to creditors known or reasonably ascertainable by the personal representative within one month from first publication of notice were not applicable to the estate or to the administratrix.

In addition, the probate court declared that the claim did not become ascertainable during the three months following the first publication of notice. Therefore, the administratrix had no duty to send actual notice to the appellants. Turning to the nonclaim statute, the probate court ruled that the appellants had failed to file their claim within the three months required, which barred their claim for recovery against the estate.

Also, on October 2, 1992, a second order was entered denying the appellants’ request for an evidentiary hearing. The probate court reiterated that the appellants had an opportunity to present their case on August 20,1992. It also found that the facts necessary to decide the claim were undisputed and that an additional hearing to put facts into the record which were irrelevant to the ruling on the claim was unnecessary. Further, the court found that the issues raised with respect to the unconstitutionality of the Probate Code notice provisions were not raised at the first hearing and, thus, untimely.

On October 12, 1992, the appellants filed a motion for amendment of order and trial on the merits of the case. The motion was deemed denied on the 30th day under Ark. R. App. P. 4(c). The estate was then closed on November 24, 1992.

I. EVIDENTIARY HEARING

The appellants first contend that they were denied an evidentiary hearing and the chance to make a record on their claim.

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Bluebook (online)
858 S.W.2d 93, 314 Ark. 54, 1993 Ark. LEXIS 441, Counsel Stack Legal Research, https://law.counselstack.com/opinion/bowling-v-spears-ark-1993.