Appeal
From The ST. Francis County Circuit Court [No. 62CV-14-179]
Honorable Chalk Mitchell, Judge
Branch, Thompson, Warmath & Dale, P.A., by: Robert F.
Thompson, for appellant.
Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C.,
by: M. Samuel Jones III and Brian A. Pipkin, for appellee.
BRANDON J. HARRISON, Judge.
This
appeal concerns the transfer of more than $1.2 million in
stock and the securities law of Arkansas. The main procedural
issue is whether the circuit court correctly granted summary
judgment in favor of First National Bank of Eastern Arkansas
on a complaint that William Ash filed against the bank. The
complaint raised breach-of-fiduciary-duty, conversion, and
replevin claims against First National Bank. Ash challenges
the circuit court's decision that he had legally
transferred his shares of stock in Bancshares of Eastern
Arkansas, Inc. to First National Bank of Eastern Arkansas, as
the trustee for the irrevocable testamentary trust Ash's
mother had created. Ash says he intended to put the stock
into a separate and new revocable trust that he thought he
had created with an attorney's help. Ash also contends
that, even if there was a transfer of stock to the
irrevocable testamentary trust, then the transfer still
represents an overreach by the bank and opens it up to some
potential liability such that summary judgment was improper.
We agree with Ash in part, and disagree in part.
I.
The Previous Appeal (Ash I)
This is
neither the parties' nor this court's first rodeo. In
2017, we vacated the St. Francis County Circuit Court's
order granting summary judgment to First National Bank and
held that the "court erred as a matter of law when it
determined that the stock power, standing alone, effectively
transferred the stock and foreclosed all of Ash's claims
under Arkansas law." Ash v. First Nat'l Bank of
E. Ark., 2017 Ark.App. 57, at 4, 513 S.W.3d 268, 271
(Ash I). We stated that the "better
course" was for the parties to argue, and the circuit
court to decide, how a security is effectively transferred
under Arkansas law and whether an adverse claim is foreclosed
under this state's securities law. Id.; see
also Ark. Code Ann. §§ 4-8-101 to -603 (Repl.
2001 & Supp. 2017) (adopting Uniform Commercial Code).
After
First National Bank's unsuccessful attempt to seek review
of our first opinion in the Arkansas Supreme Court, the
mandate issued and the summary-judgment order was officially
voided. See Johnson v. Windstream Commc'ns,
Inc., 2014 Ark.App. 99. On remand in November 2017, the
circuit court set the case for a bench trial in 2018. In
December 2017, the bank filed a "post-appeal motion for
summary judgment" that also incorporated its previous
summary-judgment motion. Ash responded. But on the second
go-around Ash did not also ask the court for summary
judgment; he only asked the court to deny the bank's
motion and to award all the relief requested in the
complaint. Ash attached seven exhibits to his response:
1. Stock certificate (included in the first appeal record)
2. Corporation's shareholder agreement
3. Bank's supplemental objections and responses to
Ash's third set of interrogatories and requests for
production of documents
4. Deposition of William Campbell Ash dated 18 May 2015
(included in the first appeal record)
5. Deposition of William Campbell Ash dated 15 September 2015
(included in the ...