Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Stodola v. Lynch

Supreme Court of Arkansas

May 18, 2017

MARK STODOLA, MAYOR OF THE CITY OF LITTLE ROCK; CITY OF LITTLE ROCK; JOE SMITH, MAYOR OF THE CITY OF NORTH LITTLE ROCK; CITY OF NORTH LITTLE ROCK APPELLANTS
v.
JIM LYNCH, TONY ORR, AND GLEN M. MILLER APPELLEES

         APPEAL FROM THE PULASKI COUNTY CIRCUIT COURT [NO. 60CV13-360] HONORABLE MACKIE M. PIERCE, JUDGE

          Thomas M. Carpenter, for Little Rock appellants; and John L. Wilkerson, for North Little Rock appellants.

          McMath Woods, P.A., by: James Bruce McMath, Samuel E. Ledbetter, and Carter C. Stein; and The Fonticiella Rios Law Firm, PLLC, by: Sonia Eileen Fonticiella Rios, for appellees.

          JOSEPHINE LINKER HART, ASSOCIATE JUSTICE

         The Pulaski County Circuit Court concluded that appropriations made by municipal ordinances or resolutions of the Cities of Little Rock and North Little Rock (the Cities) to the Little Rock Regional Chamber of Commerce, Metro Little Rock Alliance, the North Little Rock Regional Chamber of Commerce, and the North Little Rock Economic Development Corporation were in violation of article 12, section 5 of the Arkansas Constitution. In reaching its decision, the circuit court further found that "contracts" authorized by the Cities with these various entities were void for lack of consideration and were instead "donations" to the economic development efforts of these entities. The court found that appellants were "permanently ENJOINED from passing ordinances or resolutions in violation of Ark. Const. Art. 12, § 5." Appellants, the Cities and their respective mayors, appeal that decision. However, because an amendment to article 12, section 5 of the Arkansas Constitution has rendered the basis for the circuit court's injunction moot, we remand to the circuit court with instructions to lift the injunction and dismiss appellees' complaint.

         Before we consider the arguments on appeal, however, we must first consider appellees' motion to dismiss on the basis that this court lacks jurisdiction to hear the appeal. The resolution of this question necessarily requires a brief recitation of the procedural history of this case.

         On January 24, 2013, appellees filed a complaint bringing four claims against appellants: (1) appellants had made unlawful appropriations in violation of article 12, section 5 of the Arkansas Constitution; (2) appellants had misused and illegally spent public funds generated from tax revenue, which constituted an illegal exaction; (3) the City of Little Rock had violated its own ordinances relating to bidding and contracting procedures; (4) the City of North Little Rock had violated its own ordinance related to bids. Appellants answered, and appellees moved for partial summary judgment on their claim relating to article 12, section 5 of the Arkansas Constitution.

         On February 19, 2015, appellees moved for a voluntary dismissal of all claims except for the claim alleging a violation of article 12, section 5 of the Arkansas Constitution. The circuit court granted the motion the following day. In an amended order filed June 26, 2015, the circuit court found in favor of appellees on the remaining claim. Appellants initially sought to appeal to this court from this order but subsequently dismissed the appeal.

         On March 3, 2016, appellants moved to dismiss with prejudice the three unlitigated claims, even though those claims previously had been dismissed by the circuit court. In an order filed May 2, 2016, the circuit court denied appellants' motion. The court stated that appellants were seeking the court's dismissal with prejudice of claims that were "not currently before this Court" because those claims had been dismissed. The court concluded that "at this point, this Court has no jurisdiction over this matter, and even if it did, it is basic to the judicial process that the Court cannot rule on the merits of claims not before it." The court stated that "[i]n light of the lack of jurisdiction, " it declined to rule on appellants' motion to dismiss with prejudice the three claims. On May 17, 2016, appellants filed a notice of appeal. In the notice of appeal, appellants asserted that they were appealing from the amended order filed on June 26 2015, and from the May 2, 2016 order "ending all issues on appeal."

         Appellees have filed with this court a motion to dismiss the appeal. In their motion, appellees assert that appellants have raised on appeal arguments relating only to the June 26, 2015 order and that their appeal from that order had been abandoned. Appellees further argue that the circuit court properly found in its May 2, 2016 order that it lacked jurisdiction and that, consequently, this court lacks jurisdiction to hear the appeal. In response, appellants argue that they could not have appealed from the June 26, 2015 amended order because it was not a final order. Further appellants contend that the May 2, 2016 order was a final order from which appellants timely appealed.

         This court, in Deer/Mt. Judea School District. v. Kimbrell, 2013 Ark. 393, 430 S.W.3d 29, cited Mountain Pure LLC v. Affiliated Foods Southwest, Inc., 366 Ark. 62, 233 S.W.3d 609 (2006), stating, "Under Mountain Pure, jurisdiction vests in the circuit court until such time as any outstanding claims are properly adjudicated or are no longer a bar to finality and a final order is entered." Deer/Mt. Judea Sch. Dist., 2013 Ark. 393, at 7-8, 430 S.W.3d at 37. Thus, we must determine whether the three unlitigated claims that were dismissed are no longer a bar to finality, allowing the case to be appealed.

         Appellees filed their cause of action on January 24, 2013. On February 20, 2015, appellees dismissed these three unlitigated claims as permitted by Rule 41(a), and in accordance with that rule, the dismissal of the three claims was without prejudice. When a nonsuit has been made effective, a new action may be filed within one year of the nonsuit or within the applicable statute of limitations, whichever is longer. Ark. Code Ann. § 16-56-126(a)(1) (Repl. 2005); Blaylock v. Shearson Lehman Bros., 330 Ark. 620, 622, 954 S.W.2d 939, 940 (1997). The three unlitigated claims were illegal-exaction claims. See Smith v. City of Springdale, 291 Ark. 63, 722 S.W.2d 569 (1987) (challenging bidding practices in an illegal-exaction claim). We have applied a three-year statute of limitations to illegal-exaction claims. Munson v. Abbott, 269 Ark. 441, 602 S.W.2d 649 (1980). Assuming that appellees' causes of action accrued, at the latest, on the date of the filing of the complaint, January 24, 2013, the statute of limitations would have expired three years later in January 2016. Further, the three unlitigated claims were nonsuited on February 20, 2015, and had to be refiled within one year. The claims were not refiled. Thus, on March 3, 2016, when appellants filed their motion to dismiss with prejudice the three unlitigated claims, those claims no longer could be litigated by appellees. Accordingly, those three unlitigated claims were no longer a bar to finality, and the court's May 2, 2016 order denying the motion to dismiss with prejudice the three unlitigated claims constituted a final order from which appellants timely appealed. See Deer/Mt. Judea Sch. Dist., 2013 Ark. 393, at 7-8, 430 S.W.3d at 36-37 (holding that an order denying a motion for reconsideration constituted a final order because at the time the order was entered, all nonsuited claims had been adjudicated and were no longer a bar to finality); Mountain Pure LLC, 366 Ark. 62, 233 S.W.3d 609 (holding that the circuit court's order concluding that it was without jurisdiction to entertain a complaint because the case had been dismissed without prejudice constituted a final order because all other claims either had been refiled or dismissed with prejudice). Thus, the appeal is properly before us. Accordingly, we deny appellees' motion to dismiss the appeal.

         We now turn to the appeal of the circuit court's decision to permanently enjoin the appellants from passing ordinances or resolutions in violation of article 12, section 5 of the Arkansas Constitution. In their motion for partial summary judgment, appellees argued that appellants had appropriated city funds to private corporations using "service contracts" for which appellants received no direct, distinct service. Appellees asserted that the contracts violated article 12, section 5 of the Arkansas Constitution and were invalid due to lack of consideration and absence of benefits to the taxpayers. Appellees asked for a declaratory judgment that the appropriation of moneys by appellants to the Little Rock Regional Chamber of Commerce, the Metro Little Rock Alliance, the North Little Rock Economic Development Corporation, and the North Little Rock Regional Chamber of Commerce was unlawful in violation of article 12, section 5 of the Arkansas Constitution. Appellees further asked that the court issue an injunction ordering appellants to cease the unlawful appropriation of tax revenue and order appellants to cease engaging in illegal contracts.

         In its amended order, the circuit court found that "the 'contracts' at issue in this case are void for lack of legal consideration and are not valid contracts for the exclusive benefits of the cities of Little Rock and North Little Rock." The court further found that "annual lump sum appropriations are donations to the economic development efforts of the relevant chambers of commerce, economic development organizations, and collaborative regional industrial projects" that were appropriations made "in the absence of discrete services rendered in return." The court concluded, "Ordinances or resolutions effectuating such appropriations plainly violate Ark. Const. Art. 12, § 5." ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.