Callaghan v. Coberly

927 F. Supp. 332, 1996 U.S. Dist. LEXIS 8186, 1996 WL 330407
CourtDistrict Court, W.D. Arkansas
DecidedMay 29, 1996
DocketNo. 95-5227
StatusPublished

This text of 927 F. Supp. 332 (Callaghan v. Coberly) is published on Counsel Stack Legal Research, covering District Court, W.D. Arkansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Callaghan v. Coberly, 927 F. Supp. 332, 1996 U.S. Dist. LEXIS 8186, 1996 WL 330407 (W.D. Ark. 1996).

Opinion

MEMORANDUM OPINION

H. FRANKLIN WATERS, Chief Judge.

This is ■ an action for wrongful death brought against the personal representative of the estate of Martha Coberly to recover insurance proceeds from a policy held by the estate. This action would be time-barred by the probate code’s statute of nonclaim, Ark. Code Ann. § 28-50-101(a) (Michie Supp. 1995), were it not for the fact that tort claims that can recovered entirely from insurance proceeds are exempt from that statute, id. § 28-50-101(f) (Michie Supp.1995).

The issue before this court on summary judgment is whether this exemption to the statute of nonclaim is constitutional. If not, then plaintiff’s claim is time-barred. The court will hold that the exemption contained in Ark.Code Ann. § 28 — 50—101(f) is constitutional, and that defendant’s motion for summary judgment should be denied.

I. BACKGROUND

The following recitation of facts is intended solely for purposes of deciding this motion.

On November 12,1993, at 11:50 a.m., Martha Coberly (“Mrs. Coberly”) ran a stop sign and was struck by a third party motorist. Both she and her passenger, Elfrieda Lowery, died as a result of the accident.

On December 30, 1993, Martin Dane Coberly (“Mr. Coberly”) was appointed as executor of the estate of his deceased wife by the Probate Court of Benton County.

On November 17, 1994, the Probate Court of Benton County entered an order directing distribution of the estate assets and further providing that Mr. Coberly “be fully and finally released and discharged from his trust herein, and released and discharged from any and all liability or accountability, and the administration of said estate closed.” The order was filed on February 1,1995.

On October 18, 1995, plaintiff filed a wrongful death complaint in the Circuit Court of Benton County as executrix of the estate of Elfrieda Lowery against Mr. Coberly as executor of the estate of Mrs. Coberly. This action was removed to federal court on November 13,1995.

Plaintiffs lawsuit was filed within the three year statute of limitations for wrongful death actions provided by Ark.Code Ann. § 16 — 62—102(c)(1) (Michie Supp.1995).

However, it was filed after the limitations period provided by the statute of nonclaim. The statute of nonelaim provides that all claims against a decedent’s estate are time-barred unless they are verified to the personal representative of the estate or filed with the court within three months after the date of the first publication of notice to decedent’s creditors. Ark.Code Ann. § 28-50-101(a).

[334]*334Nevertheless, plaintiffs suit was still timely because subsection (f) of Ark.Code Ann. § 28-50-101 provides that tort claims that can recovered entirely from available insurance are exempt from the statute of non-claim.

Since defendant is challenging the constitutionality of subsection (f), the court will quote that provision in its entirety.

(0 Certain Tort Claims Not Affected.
Notwithstanding the foregoing provisions relating to the time for filing claims against an estate, or any other provisions of this code, a tort claim or tort action against the estate of a deceased tortfeasor, to the extent of any recovery which will be satisfied from liability insurance or from uninsured motorist insurance coverage and which will not use, consume, or deplete any assets of the decedent’s estate, may be brought within the limitation period otherwise provided for the tort action. No recovery against the tortfeasor’s estate shall use, consume, diminish, or deplete the assets of the decedent’s estate, and any recovery shall not affect the distribution of the assets of the estate to the heirs, next of kin, legatees, or devisees of the deceased tortfeasor unless a claim is filed in the manner and within the time provided by this code for filing claims against the estate.

Ark.Code Ann. § 28-50-101(f).

On November 21, 1995, plaintiff filed an ex parte request with the Probate Court of Benton County to reopen the estate of Mrs. Coberly to the extent of available insurance proceeds. The probate judge granted the request with an order that:

the Estate of Martha Coberly, Martin Dane Coberly, Executor, Benton County Probate P 93-443 — 1 be reopened to the extent of available insurance coverage; that petitioner ... be granted the right to sue the estate for available insurance coverage pursuant to Ark.Code Ann. § 28-50-101(f).

The personal representative of Mrs. Coberly’s estate forwarded the summons and complaint to the decedent’s insurer, who subsequently assumed the duty to defend the estate under a reservation of rights.

II. CONSTITUTIONALITY

Defendant contends that subsection (f) of Ark.Code Ann. § 28-50-101 is unconstitutional, because it violates the Due Process Clause and Equal Protection Clause of the United States Constitution by establishing a special category of claimants with special rights with no rational basis for doing so. This argument will be rejected.

Under the Equal Protection Clause, social and economic legislation that does not impinge on fundamental rights and that does not utilize suspect classifications will be upheld “when the legislative means are rationally related to a legitimate governmental purpose.” Hodel v. Indiana, 452 U.S. 314, 331, 101 S.Ct. 2376, 2387, 69 L.Ed.2d 40 (1981). “[S]uch legislation carries with it a presumption of rationality that can only be overcome by a clear showing of arbitrariness and irrationality. ... This is a heavy burden.” Id. at 331-32, 101 S.Ct. at 2387. In essence, the test is the same under the Due Process Clause. See Hodel, 452 U.S. at 331-333, 101 S.Ct. at 2386-2388 (performing a single rational basis analysis to uphold land use regulation against an equal protection and a substantive due process challenge); 3 Ronald D. Rotunda & John E. Nowak, Treatise on Constitutional Law Substance and Procedure § 18.1 (2d ed. 1992) (“the standards for validity under the due process and equal protection clauses are identical”).

Defendant contends that subsection (f) is irrational, because two litigants may have absolutely identical causes of action, but only one litigant can bring suit, because only that litigant will be able to sue on applicable insurance coverage. The litigant who is not lucky enough to be able to sue against an insurance policy will be time-barred.

Defendant is correct as to what subsection (f) means, but the court disagrees that subsection (f) is irrational. The court believes that the current statutory regime is a reasonable accommodation of two competing legislative policies. The first policy is to provide certainty and closure to estate administration, and to prevent the elimination or depletion of estate assets by claims not filed time[335]*335ly. The second policy is to provide redress for personal injury victims. When recovery against the estate is, as a practical matter, purely against an insurance policy held by the estate, allowing a lawsuit against the estate has little effect on its administration. Thus, there is no policy reason for applying the statute of nonclaim when recovery is purely against the insurance policy, or a reasonable person could so conclude.

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Cite This Page — Counsel Stack

Bluebook (online)
927 F. Supp. 332, 1996 U.S. Dist. LEXIS 8186, 1996 WL 330407, Counsel Stack Legal Research, https://law.counselstack.com/opinion/callaghan-v-coberly-arwd-1996.