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Progressive Eldercare Services-Saline, Inc. v. Cauffiel

Court of Appeals of Arkansas, Divisions II, III

November 2, 2016




          Kutak Rock LLP, by: Mark W. Dossett and Jeff Fletcher, for appellant.

          Reddick Moss, PLLC, by: Brian D. Reddick, Robert W. Francis, and Matthew D. Swindle, for appellee.

          LARRY D. VAUGHT, Judge

         Progressive Eldercare Services-Saline, Inc., d/b/a Heartland Rehabilitation and Care Center (Progressive), appeals from the denial of its motion for summary judgment based on the affirmative defense of charitable immunity. We affirm.

         Carolyn Sue Cauffiel was a resident of Progressive from February 29, 2012, to July 22, 2012, and passed away on July 25, 2012. On June 14, 2013, Terry Cauffiel, Carolyn's son, as administrator of her estate and on behalf of her wrongful-death beneficiaries, filed a complaint in the Saline County Circuit Court against Progressive and a number of other defendants. The complaint alleged that the defendants had "failed to discharge their obligation of care to Carolyn Sue Cauffiel with a conscious disregard for her rights and safety, " which culminated in Carolyn suffering multiple injuries and ultimately death. The complaint alleged numerous causes of actions, including negligence and medical malpractice.

         Progressive answered the complaint and subsequently moved for summary judgment seeking charitable immunity. Cauffiel responded and argued that not only was Progressive not entitled to charitable immunity, it was abusing the charitable form to avoid liability. After a hearing, the circuit court denied Progressive's motion for summary judgment, explaining that "I do think there are material issues of fact. The foremost one is the argument that [Progressive] is simply a shell that's abusing its appearance of being a charitable immunity [sic] when in fact it should not be entitled to that." Progressive has appealed the circuit court's denial of summary judgment.

         As a general rule, the denial of a motion for summary judgment is neither reviewable nor appealable. Ark. Elder Outreach of Little Rock, Inc. v. Thompson, 2012 Ark.App. 681, at 4, 425 S.W.3d 779, 783. The general rule does not apply, however, where the refusal to grant a summary-judgment motion has the effect of determining that the appellant is not entitled to its defense of immunity from suit, because the right of immunity from suit is effectively lost if a case is permitted to go to trial. Id., 425 S.W.3d at 783. This case is, therefore, appealable.

         Our standard of review for summary judgment is well settled:

Summary judgment is to be granted by a trial court only when it is clear that there are no genuine issues of material fact to be litigated and the moving party is entitled to judgment as a matter of law. Once a 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. After reviewing undisputed facts, summary judgment should be denied if, under the evidence, reasonable minds might reach different conclusions from those undisputed facts. On appeal, we determine if summary judgment was appropriate based on whether the evidentiary items presented by the moving party in support of its motion leave a material question of fact unanswered. This court views 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. Our review is not limited to the pleadings, as we also focus on the affidavits and other documents filed by the parties.

Jackson v. Sparks Reg'l Med. Ctr., 375 Ark. 533, 539, 294 S.W.3d 1, 4-5 (2009) (citations omitted). The object of summary-judgment proceedings is not to try the issues but to determine whether there are any issues to be tried, and if there is any doubt whatsoever, the motion should be denied. Flentje v. First Nat'l Bank of Wynne, 340 Ark. 563, 569-70, 11 S.W.3d 531, 536 (2000).

         The essence of the charitable-immunity doctrine is that entities created and maintained exclusively for charity may not have their assets diminished by execution in favor of one injured by acts of persons charged with duties under the entity. George v. Jefferson Hosp. Ass'n, 337 Ark. 206, 211, 987 S.W.2d 710, 712 (1999). Because the doctrine favors charities and results in a limitation of potentially responsible persons whom an injured party may sue, we give the doctrine a very narrow construction. Thompson, 2012 Ark.App. 681, at 6, 425 S.W.3d at 783-84. The burden of pleading and proving this affirmative defense is on the party asserting it. Id., 425 S.W.3d at 784. The issue of whether a party is immune from suit is purely a question of law and is reviewed de novo. Id. at 5, 425 S.W.3d at 783.

         When determining whether a corporation is entitled to charitable immunity, Arkansas courts consider eight 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.

Masterson v. Stambuck, 321 Ark. 391, 401, 902 S.W.2d 803, 809 (1995). Whether the charitable-entity form has been abused is a "pivotal issue" in determining a defendant's entitlement to charitable immunity. Watkins v. Ark. Elder Outreach of Little Rock, Inc., 2012 Ark.App. 301, at 12, 420 S.W.3d 477, 484.[1] These factors are illustrative, not exhaustive, and no one factor is dispositive. Masterson, 321 Ark. at 401, 902 S.W.2d at 810. Questions of fact may arise when determining whether the charitable form has been abused, i.e., issues surrounding the reasonableness of the organization's expenses and the intent ...

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