Opposition Brief — Stoltz v. First Pyramid Life Insurance Co. of America

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AUG 2 5 1993

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No. 93-128

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 1993

J. MICHAEL StTo.ttz, AS SPECIAL ADMINISTRATOR OF

THE ESTATE OF J.P. Sto_tTz, DECEASED.

Petitioner.

FIRST PYRAMID LIFE INSURANCE COMPANY

Or AMERICA, et al.,

Re spondent.

On Petition For A Writ Of Certiorari

To The Arkansas Supreme Court

RESPONDENT’S BRIEF IN OPPOSITION

*JoHN E. TUL III

PETER G. KUMPE

J. LEON HOLMES

WILLIAMS & ANDERSON

Twenty-Second Floor

111 Center Street

Little Rock, AR 72201

(501) 372-0800

Attorneys for Respondent

*Counsel of Record

PRESS OF BYRON S. ADAMS, WASHINGTON, D.C. (202) 347-8203

BEST AVAILABLE COPY

—— ee —

QUESTIONS PRESENTED

Petitioner represents certain disgruntled family

members who sued an insurance company for breach

of contract because it paid $2,000,000 in life insurance

proceeds to their brother rather than the estate. Pay-

ment was made January 19, 1978, and their action

was filed on April 20, 1989, more than 11 years after

payment. A jury returned a verdict for $2,000,000 in

compensatory damages plus $1,000,000 in punitive

damages, but the Arkansas Supreme Court unani-

mously reversed the case on the ground that it was

barred by the statute of limitations. Following the

reversal, petitioner claimed that the Chief Justice of

the Arkansas Supreme Court (and the author of the

opinion) was biased because he had gone quail hunting

with Herschel Friday of the Friday, Eldredge & Clark

law firm (“Friday Firm’’). Petitioner claimed the Fri-

day Firm had an interest in the outcome even though

they were not a party to the lawsuit. In this context,

the petitioner raises the following questions:

1. Whether petitioner’s due process rights were vi-

olated because the Chief Justice of the Arkansas

Supreme Court purportedly went quail hunting with

a member of a law firm whose lawyers were witnesses

in the law suit.

2. Whether petitioner’s due process rights were vi-

olated because the Arkansas Supreme Court noted

that two family members represented by petitioner

had also received notice that the estate of J.P. Stoltz

was initially named as beneficiary of his life insurance

policies.

TABLE OF CONTENTS

Page

QUESIOON PRMUEIEES sccsisenisctsmanmne i

TAR GP COREE ES scsessesinarivtsscinmenaen ll

TABiae GF ALTERS EIED stesncnisimmanamanes ill

SRARMEURIEINE GE EER GAIN desecesssiccnscoesncceteasnanenens 1

Bi. TREO. sinniiccrincicinisdeaene 1

BD. PROCORG BOW esciccicinciimeaae 1

SURREAL OF ARAAUMEING cccescsscccensvssenssnusmescnecssss 8

REASONS FOR DENYING THE PETITION ............. 9

A. Petitioner’s Due Process Rights Were Not

Violated Because Any Insignificant Social

Relationship Between The Honorable Chief

Justice of the Arkansas Supreme Court And

A Nonparty Did Not Constitute Grounds for

aan ontnsideinuhiibiesiineneumuanateaeeiaiaiaiaaeae 9

1. The issues presented do not concern con-

stitutional and statutory questions that are

likely to have widespread general

SIEE. .ssinscssnicgnacmmmcamena dean ainbaatae 9

2. Petitioner’s claim that the Chief Justice

of the Arkansas Supreme Court had a

longstanding social relationship with an

interested party is baseless. .................6.. 11

B. The State of Arkansas Did Not Violate

Petitioner’s Right To Due Process And Tulsa

Professional Collection Services, Inc. v. Pope,

485 U.S. 478 (1988) Is Inapplicable. ............ 18

CUBFRAIEOET scovsncsscnneseynetesianseeisiien elie eeaeaie 20

FADE ERRTEIGAL. oinsscassnensnevenencerseanvenseniiibeeie ee la

iil

TABLE OF AUTHORITIES

CASES: Page

Aetna Life Ins. Co. v. Lavoie, 106 S.Ct. 1680

atti scdiahinnhscsensunecsenabarcurcecsesceensoqense 916,17

Arkansas Indus. Dev. Comm’n v. FABCO, 312 Ark.

25, 847 S.W.2d 13 (1993) ...........cccccccccrceserseeee 15

City of Jacksonville v. Venhaus, 302 Ark. 204, 788

IE EE BID cccnccacssncccscscnccassonsenssscosssssoses 17

Committee For Utility Training, Inc. v. Hamilton,

290 Ark. 283, 286, 718 S.W.2d 933 (1986) .... 13

Farr v. Newman, 14 N.Y.2d 183, 199 N.E.2d 369

(N.Y. App. 1964) ...............ccccccsscssscrccssssssssccees 19

Ford’s, Inc. v. Russell Brown & Co., 299 Ark. 426,

SE WP CE IOD cosncccvcncsnssonsnnrecssonsesocccanee 19

Ingram v. Luther, 244 Ark. 260, 424 S.W.2d 546

IIT Lin tilitscpaskarsesessisscsenstessssonseseassonerccesesesoees 19

Johnson v. Sturdivant, 295 Ark. 622, 758 S.W.2d

Ie carichitsdictensyebsanasnnessvccsesveatsassosonseseosses 16

Korokov v. Korokov, 33 Ark. App. 194, 197, 803

EE WD CRUE) secesccevesscseccccscsscesencccccsssscenees 20

Lilejeberg v. Health Services Acquisition Corp., 486

SME SETIED cnnsesesnsccesesescsessnssiossccossosvsesensess 17

Matthews v. Rogers, 279 Ark. 328, 333-4, 651

EE ME BEOEGD sesssscnsescsscsssansnessecessnnessvecesers 13

Moore v. Missouri Pacific R.R., 299 Ark. 232, 773

S.W.2d 28, 6 A.L.R. 5th 1188 (1989) ............ 16

Patterson v. R.T., 301 Ark. 400, 784 S.W.2d 777

IIT ic dui dassnersaseliosonsanessaszovesdassssesovesnnssocarceses 17

Pope County v. Friday, Eldredge & Clark, 313 Ark.

BB, 862 S.W.2d 114 (1990S) .........cccccccccccccrrresees 14

Porter v. McCuen, 310 Ark. 562, 839 S.W.2d 512

IIIS) shi usacedustepnsadenksuscccnvsienntarsvosnosevennesaceseseses 15

Potlatch Corp. v. Arkansas City School Dist., 311

Ark. 145, 842 S.W.2d 32 (1992) ...........cccees 15

Table of Authorities Continued

Page

318, 811 S.W.2d 315, opinion on reh’g, 306

Ark. 321, 821 S.W.2d 475 (1991) .............cc00. 16

Southwestern Bell Tel. Co. v. Blastech, Inc., 313

Ark. 202, 852 S.W.2d 813 (1993) ................... 15

Tulsa Professional Collection Services, Inc. v. Pope,

i Pe HI wa chasis pandensirancgckaduasianie iakound 18,19

Younts v. Baldor Electric Co., 310 Ark. 86, 832

ee cassens 15

STATEMENT OF THE CASE

A. Introduction

The Arkansas Supreme Court in a unanimous de-

cision reversed a jury award in favor of petitioner

because the lawsuit was filed more than 11 years

after the act in question and the statute of limitations

had run. The Arkansas Supreme Court also noted that

the record was devoid of any evidence of fraudulent

concealment necessary to toll the running of the stat-

ute of limitations. Following the reversal, petitioner

asserted for the first time that a “reliable source”’

had informed him that the Chief Justice of the Ar-

kansas Supreme Court and Herschel Friday had gone

quail hunting together on several occasions. Subse-

quently, ‘petitioner instructed his attorneys to inves-

tigate” the matter and in short shrift a motion for

rehearing and vacatur was presented to the Arkansas

Supreme Court. Both were denied.

Even were the underlying facts true, the issues

presented are not novel and there is no reason for

this court to grant certiorari. The first and second

questions presented by the petition are the same and

do not need to be considered separately.

B. Proceedings Below

On December 18, 1975, J.P. Stoltz applied to First

Pyramid for life insurance totalling $2,000,000. The

application designated the proposed insured’s estate

as beneficiary. Later, for tax reasons the application

was revised to seek two policies: one in the amount

of $50,000 and another for $1,950,000. After the ap-

plications were accepted, J.P. Stoltz completed and

delivered to First Pyramid beneficiary agreements

naming his oldest son, Steve Stoltz, as beneficiary.

That change was accepted in writing by First Pyra-

mid without the countersignature on behalf of the

Oklahoma trustee that acted as “‘legal’’ owner of the

policy. To generate greater tax savings, First Pyra-

mid designated these policies to be issued in Okla-

homa because that State’s law authorized higher group

policy limits than did Arkansas law. J.P. Stoltz also

completed and delivered a change of ownership form

to First Pyramid naming his son owner of the larger

($1,950,000) policy to avoid paying estate tax on the

policy proceeds.

J.P. Stoltz died on December 18, 1977. Only his

son Steve Stoltz claimed the policy proceeds. Before

paying the claim, First Pyramid sought the advice of

its attorney, Allan W. (‘‘Dick’’) Horne. Mr. Horne

concluded in a memorandum (‘‘Horne memorandum’’)

that Steve Stoltz was the legal beneficiary, but rec-

ommended that the proceeds be interpleaded because

of uncertainties in file documentation including the

lack of the Oklahoma trustee’s signature on the ben-

eficiary agreement. Mr. Horne’s advice was summa-

rized in a memo:

SUMMARY: There is a substantial risk

whether payment is made to the son or to

the estate.

(a) There appears less risk if payment is

made to the son since those involved seem

sure he was the intended beneficiary.

(b) There appears more risk if payment is

made to the estate because of the insured’s

apparent intent to benefit the son.

duced by requiring an indemnity agreement

from either the son or the estate.

(d) An interpleader action is probably the

safest course. However, the company could

be exposed to a suit from the loser, i.e., the

son or the estate. Therefore, this alternative

is not a complete solution either. [emphasis

added]. (App. 1.)

At a later meeting with officers of First Pyramid,

and after further consideration, Mr. Horne concurred

that paying the son without interpleader was ‘‘the

best course.’’ On January 19, 1978, respondent First

Pyramid Life Insurance Company of America (“First

Pyramid”) paid James Stephen Stoltz (“Steve Stoltz’’)

$2,000,000.

During separate litigation commenced on May 4,

1984, by the Internal Revenue Service to collect un-

paid taxes, an attorney at Friday, Eldredge & Clark

(“Friday Firm’’) acting as counsel for J.P. Stoltz’s

estate discovered and reviewed the Horne memoran-

dum. The estate counsel considered the irregularities

in the file and concluded that Steve Stoltz was the

legal beneficiary, but did not report the discovery to

any estate beneficiaries except Steve Stoltz, who was

also executor of the estate. On September 3, 1987,

over nine years after the policies had been paid, cer-

tain beneficiaries of the Stoltz estate commenced an

action in Faulkner County Probate Court to challenge

the management of the estate. Discovery in the pro-

bate action again produced the Horne memorandum.

On April 20, 1989, those dissatisfied estate members

commenced this action.

This case was brought originally as a negligence

and breach of contract action coupled with a claim

of bad faith. Because of the 11-year delay in bringing

the claim, petitioner also alleged fraudulent conceal-

ment in an attempt to overcome the limitations de-

fense. The original trial judge was the Honorable

Perry V. Whitmore. Judge Whitmore overruled a mo-

tion for summary judgment on the limitations issue

after hearing argument on two separate occasions,

concluding:

To avoid the loss of those causes of action,

the plaintiff must prove either the defendant

insurance company by its overt acts caused

the legal right to be hidden and thereby be-

come time barred; or there existed a specific

legal relationship between the parties that in

and of itself obligated an overt disclosure of

the existence of those claims. An insurer/ben-

eficiary relationship does not seem to create

that legal obligation; however, on the claim

of a factual coverup, the plaintiff should have

its day in court.

At this point, the case remained a negligence and

contract case with a claim of bad faith. The trial court

recognized that the tolling of the statute under the

doctrine of fraudulent concealment depended on proof

that First Pyramid acted to conceal the claim.

Following Judge Whitmore’s retirement, the limi-

tations issue was again presented to the trial court.

This time it was coupled with a motion for summary

judgment which claimed that Steve Stoltz was the

contract beneficiary as a matter of law. During the

course of the argument, petitioner’s counsel asserted

that the Friday Firm was implicated in a conspiracy

to conceal a fraud from the estate while that firm

was the estate’s attorney. On the limitations issue,

The Honorable Chris Piazza concluded that fraudulent

concealment was an issue for the jury, but unlike

Judge Whitmore who focused on conduct by First

Pyramid, Judge Piazza emphasized petitioner’s con-

spiracy allegation as creating a jury issue:

Then you have this allegation, you know, that

there was some type of fraud there that the

association [by First Pyramid through the

Friday Firm lawyer-Buddy Sutton] with the

bank, with the loan that was paid off, the

liabilities of the corporation the son paid off,

how it was interconnected.

Here, Judge Piazza initially and correctly notified

petitioner he would be required to present evidence

of a fraudulent conspiracy between First Pyramid and

the Friday Firm to escape the operation of the statute

of limitations.

During the trial from August 5-10, 1991, petitioner

abandoned the allegation of a conspiracy between the

Friday Firm and First Pyramid and failed to present

any evidence of such a conspiracy. The trial court

submitted the case over the objection of First Pyr-

amid on a general verdict under a contract theory

coupled with instructions characterized as “‘fraud due

to nondisclosure.’”’ Petitioner tendered no bad faith

instruction and withdrew his negligence instruction

immediately prior to the reading of the instructions.

The jury returned a general verdict and Judge Piazza

directed a verdict for compensatory damages of

$2,000,000. The jury also awarded punitive damages

of $1,000,000. After considering several post-trial mo-

tions concerning trial errors and objection to the pro-

posed form of judgment, the trial court entered

judgment as assessed by the jury and awarded

attorneys’ fees and interest. First Pyramid filed a

timely notice of appeal from the judgment to the Ar-

kansas Supreme Court. Petitioner cross-appealed and

sought additional interest and penalties on the jury

verdict.

On December 21, 1992, the Arkansas Supreme

Court unanimously reversed the lower court. With

respect to the limitations issue, the Arkansas Supreme

Court characterized petitioner’s position in its opinion

of December 21, 1992, as follows: ‘‘Representatives

of the estate contend that the statute of limitations

in this action was tolled by First Pyramid’s allegedly

fraudulent concealment of the controversy.’ On that

issue, the dispositive sentence in the Court’s opinion

is: “There is simply no evidence of record that First

Pyramid attempted to fraudulently conceal, ‘coverup’

or misrepresent to the estate the problem with de-

termining the proper beneficiary of J.P. Stoltz’s in-

surance policy.”

Subsequently, on January 19, 1993, petitioner filed

a Motion for Vacatur, to Disqualify and, in the Al-

ternative, to Appoint a Special Master and Motion

for Extension of Time to File Petition for Rehearing.

In this pleading, petitioner alleged that the author of

the opinion of the Arkansas Supreme Court, The Hon-

orable Chief Justice Jack Holt, Jr., had favored First

Pyramid because of a substantial social relationship

between Chief Justice Jack Holt, Jr. and Herschel

Friday of the Friday law firm. In the motion for

vacatur, petitioner’s counsel relied upon a letter pur-

portedly authored by his client. [App. 2]

On January 22, 1993, petitioner filed a petition and

brief for rehearing in the Arkansas Supreme Court

alleging, inter alia, that the Court’s opinion holds

that knowledge ‘‘obtained by a distant heir and a

potential stranger to the estate, somehow constitutes

notice to the estate, and its minor children, the rights

and obligations, thereby violating the Fourteenth

Amendment to the U.S. Constitution.”’ [App. 3]

Petitioner raised no other due process rights.

On February 15, 1993, the Honorable Chief Justice

Jack Holt,Jr. filed an opinion declining to disqualify.

[App. 4] On February 18, 1993, petitioner filed a Mo-

tion for Reconsideration of the decision not to dis-

qualify. [App. 5] On February 22, 1993, the Arkansas

Supreme Court denied the Petition for Rehearing,

Motion for Stay and Motion for Reconsideration of

Motion for Vacatur, to Disqualify and, in the Alter-

native, to Appoint a Special Master. The case was

remanded to the trial court on March 15, 1993.

Petitioner has now filed his Petition for Writ of

Certiorari before this Court.

The Friday Firm is the state’s largest law firm and

is held in the highest regard. Mr. Herschel Friday is

consistently recognized as one of the finest lawyers

in Arkansas and the country and his integrity is be-

yond reproach. The client list of the Friday Firm

includes many banks and leading businesses but nei-

ther the firm nor its clients have ever received ‘‘spe-

cial”” consideration from Chief Justice Holt since he

was sworn in as the Chief Justice of the Arkansas

Supreme Court in 1985.

The Friday Firm was not an interested party in

this litigation. The Estate of J.P. Stoltz was repre-

sented by the firm and although petitioner continually

made allegations of the existence of a conspiracy be-

tween the firm and First Pyramid, he dropped the

allegations at trial and failed to present any evidence

in support thereof. Mr. William H. “Buddy” Sutton-

a leading Friday Firm lawyer-was not a member of

the board of First Pyramid at the pertinent time.

The unsatisfied family members who bring this ac-

tion continue to seek monetary relief and have re-

cently filed an action against the Friday Firm. These

family members have also settled their claim against

their brother-Steve Stoltz-who served as executor of

his father’s estate.

SUMMARY OF ARGUMENT

The Petition for Writ of Certiorari is not filed in

good faith. Essentially, petitioner claims that because

he has “reliable information’ that the Chief Justice

of the Arkansas Supreme Court went quail hunting

with a member of the Friday Firm, a law firm that

was not a party to the proceeding and a firm that

has now been sued by the petitioner, his due process

rights were violated by the failure of the Arkansas

Supreme Court to recuse itself. There are no cases

in the United States where such an insignificant social

relationship has resulted in the relief sought by

petitioner. Indeed, if the Supreme Court found that

this type of social interaction constituted grounds for

recusal, virtually every trial and appellate judge in

rural areas throughout the country would be forced

to recuse.

REASONS FOR DENYING THE PETITION

A. Petitioner’s Due Process Rights Were Not Violated

Because Any Insignificant Social Relationship Be-

tween The Honorable Chief Justice of the Arkansas

Supreme Court And A Nonparty Did Not Constitute

Grounds for Recusal.

1. The issues presented do not concern constitu-

tional and statutory questions that are likely to

have widespread general impact.

The first two questions presented in the petition

are whether and under what circumstances a party’s

due process rights are violated when an appellate

judge refuses to recuse himself. This Court has al-

ready decided this question in Aetna Life Ins. Co. v.

Lavoie, 106 S.Ct. 1680 (1986). As will be discussed

later, Aetna is not in tension with this case, rather

it simply is factually distinguishable because there was

no reason for the Arkansas appellate judge to recuse.

Thus, the question is settled and there is no reason

fx: the Supreme Court to reconsider the clear impact

of Aetna. In fact, this petition is nothing more than

petitioner’s last gasp to revive the case.

The discovery proceedings and trial of this matter

are best described as acrimonious. The petitioner rep-

resents certain family members who have sued other

family members over the estate of their deceased

father. The respondent life insurance company, whose

predecessor provided life insurance policies on their

father, was caught in the middle. After a hard-fought

trial, the Arkansas Supreme Court unanimously re-

versed the substantial jury award in its entirety be-

cause the applicable statute of limitations barred the

action. Following that reversal, petitioner has as-

serted scandalous and libelous claims regarding the

Chief Justice of the Arkansas Supreme Court and one

of the most respected law firms in the State of Ar-

kansas. It was only after the reversal that the

petitioner and his counsel made these baseless charges

of a “long standing social relationship with an inter-

ested party.”

Somewhere along the way, courts must stand up

and put a stop to petitioner’s tactic of trial by ter-

rorism, insinuation and innuendo. Petitioner’s irre-

sponsible and irrational demands that the Chief Justice

and the entire Court should vacate the Court’s opinion

and step aside from the case cannot be sanctioned.

If the Arkansas Supreme Court had recused or if this

Court gave credence to the personal attack on the

Chief Justice and the Friday Firm, seven new judges

would be appointed by Governor Jim Guy Tucker. If

those seven judges decided against petitioner, he

would no doubt allege that Governor Tucker was

somehow involved in the conspiracy that the petitioner

continues to allege in the absence of any evidence.

Moreover, petitioner’s position, if given credence by

this Court, would require reopening dozens of cases

involving the Friday Firm which have been decided

by the Arkansas Supreme Court since January 1,

1985, the date upon which Jack Holt, Jr. was sworn

in as Chief Justice. If the Chief Justice or any other

member of the appellate court was required to recuse

from this case, the same could be expected in every

future case in which the Friday Firm is involved.

Moreover, the door will be open for every party who

loses an appeal to search for some casual, social con-

nection between a member of the Arkansas Supreme

Court and someone involved, even tangentially, in the

matter. Likewise, every trial judge who hears a case

involving a lawyer with whom he has had some social

connection will be forced to recuse. Pandora’s box

would be opened, and its evils loosed, never to be

captured again.

2. Petitioner’s claim that the Chief Justice of the Arkansas

Supreme Court had a longstanding social relationship

with an interested party is baseless.

The petitioner’s claim that a “substantial long

standing social relationship’ exists between the Hon-

orable Chief Justice Holt and Mr. Herschel Friday is

without support. Petitioner submits his own pleadings,

self-serving affidavits and a copy of his complaint filed

with the Arkansas Judicial Discipline and Disability

Commission in “support’’ of his wild accusations.

Petitioner attempts to hide behind a letter purport-

edly written by him and advice purportedly given by

other, unnamed, lawyers and other unidentified per-

sons. In his statement of the case, petitioner asserts

that he instructed his attorneys to investigate whether

a long standing and close friendship existed between

the Chief Justice and the Friday firm. This ‘“‘instruc-

tion’”’ was given in the form of a letter from petitioner

to his lawyers.

No lawyer should have caved in to a demand from

a client that a Motion for Vacatur or Petition for

Writ of Certiorari be filed, even if the client de-

manded it (the letter asked only for an investigation

and advice) and even if the demand came from the

client in a bona fide manner. It should be noted that

the petitioner’s letter giving rise to the Motion for

Vacatur and the Petition for Writ of Certiorari has

the same typeset as the Motion for Vacatur and brief

in support thereof signed by the attorney. Further,

iil

Counsel’s affidavit in support of the motion for va-

catur states that Mike Stoltz ‘‘contacted me around

Christmas, 1992 ... and informed me that he had

heard of quail hunting trips taken to Herschel Fri-

day’s farm by Jack Holt, Jr. ... and trips to leased

land in the State of Texas.’’ [App. 6] The letter, which

is dated January 12, 1998, and stamped as received

on January 13, 1993, says “I am writing to inform

you of some very upsetting rumors I have heard in

the last couple of weeks.’’ Thus, the letter indicates

that its purpose is ‘‘to inform’’ counsel of something

that counsel’s affidavit says had been discussed three

weeks prior to the letter. The letter asked that counsel

“investigate these rumors immediately and notify me

of my legal options.’”’ However, the letter declined to

identify the source of the information, citing only a

“reliable source,” which is an extremely odd way for

a client to ask his lawyer to carry out an investi-

gation. By January 19, 1993, six days after the letter

is stamped as received by counsel, the investigation

had been completed, a course of action had been de-

termined, legal research had been completed, a

lengthy brief had been written, and the motion for

vacatur had been filed.

Petitioner’s lawyer should have informed his client

that casual, social contact, such as a quail hunting

expedition, is no grounds for disqualification and does

not give rise to an appearance of impropriety.

Petitioner’s lawyer should have informed his client

‘For purposes of this portion of the brief, respondent will

give credence to the claim that a quail hunting expedition had

occurred, but in fact there is absolutely no evidence that Chief

Justice Holt has ever been quail hunting with Herschel Friday

or anyone else from the Friday law firm.

oo EEEO——e—__

that there are no cases in the United States where

a judge has been disqualified because he had been

quail hunting with some lawyer who might or might

not stand to benefit from a decision of the court. The

applicable law is stated in Matthews v. Rogers, 279

Ark. 328, 333-4, 651 S.W.2d 453 (1983), where the

Arkansas Supreme Court stated:

In this State trial judges often know most,

if not all, of the attorneys who practice be-

fore them. They may have attended the same

schools, churches, or belong to the same civic

clubs. Most are members of the same bar

association. ... Those friendships within the

bench and bar do not, of themselves, cause

prejudice. The public and the clients are

aware of their mutual friendships and ac-

quaintances.

“Friendship with a member of the bar is not a ground

for recusal.’’ Committee For Utility Training, Inc. v.

Hamilton, 290 Ark. 283, 286, 718 S.W.2d 933 (1986).

There is no allegation here that Mr. Friday and Chief

Justice Holt belong to the same church, belong to the

Same civic organizations or visit in one another’s

homes. The Arkansas Supreme Court correctly de-

duced that if it gave in to petitioner’s demands it

would destroy the possibility of finding local judges

to hear cases in most, if not all, of the judicial dis-

tricts in Arkansas, where the bar is small and judges

and lawyers unavoidably have social acquaintances

which are often much closer relationships than that

alleged to exist between Mr. Friday and Chief Justice

Holt.

The assertion that the Friday Firm stood to benefit

from a reversal in this case is, like so many other

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allegations made by the petitioner, a distortion of the

truth. If the Arkansas Supreme Court wanted to pro-

tect the Friday Firm, the best way to do that would

have been to affirm the judgment. By reversing, the

door was opened for petitioner to make a claim

against the Friday Firm.? Had the judgment been

affirmed, petitioner would not have had a claim

against that firm. Moreover, as petitioner well knows,

respondent filed a third-party complaint before the

trial against four other parties, and the Friday Firm

was not among them. Indeed, it is hard to fathom

what respondent could have alleged against the Fri-

day Firm. Is it petitioner’s suggestion that First Pyr-

amid could have sued the Friday Firm for not advising

the Estate of J.P. Stoltz to sue First Pyramid?

Thus, the insinuation that the Arkansas Supreme

Court favored the Friday Firm by reversing the judg-

ment in this case is, to put it charitably, a flight of

the imagination. Further, a review of the record of

the Arkansas Supreme Court clearly reveals that the

Friday Firm does not receive special treatment from

the Arkansas Supreme Court. A simple review of re-

cent advance sheets reveals a number of cases in the

past few months in which the Arkansas Supreme

Court ruled against the Friday Firm’s interest. Re-

cently, the Arkansas Supreme Court ruled against the

Friday Firm itself in Pope County v. Friday, Eldredge

& Clark, 313 Ark. 83, 852 S.W.2d 114 (1998). In Pope

County, the Arkansas Supreme Court decided that an

action against the Friday Firm for legal malpractice

2In fact, on May 3, 1993, petitioner filed a complaint in Pu-

laski County Circuit Court against the Friday Firm styled J.

Michael Stoltz v. Herschel H. Friday d/b/a the Law Firm of

Friday, Eldredge & Clark, et al., No. 93-2813. )

was not barred by the statute of limitations. In an-

other recent case, Arkansas Indus. Dev. Comm’n v.

FABCO, 312 Ark. 25, 847 S.W.2d 18 (1993), in which

Mr. Friday was representative counsel, the Arkansas

Supreme Court denied the Friday Firm’s client an

award of reasonable attorneys’ fees but awarded

attorneys’ fees to the opposing party. See also South-

western Bell Tel. Co. v. Blastech, Inc., 313 Ark. 202,

852 S.W.2d 813 (1993); Potlatch Corp. v. Arkansas

City School Dist., 311 Ark. 145, 842 S.W.2d 32 (1992);

Porter v. McCuen, 310 Ark. 562, 839 S.W.2d 512

(1992); Younts v. Baldor Electric Co., 310 Ark. 86,

832 S.W.2d 832 (1992).°

Petitioner’s wild accusation that Chief Justice Holt

is somehow biased in favor of the Friday Firm is

equally ludicrous. Once again a review of the public

record is compelling. Chief Justice Holt has authored

several majority opinions in cases involving the Friday

Firm, and in the preponderance of cases wrote an

opinion adverse to the interests of that firm. In fact,

a computer search‘ identified eighteen majority opin-

ions authored by Chief Justice Holt in which the Fri-

day Firm represented a party—only seven of those

* Ironically, the day petitioner filed the Motion for Vacatur in

the Arkansas Supreme Court, that court issued an opinion in a

major case deciding by a 4-3 vote against the interest of the

Friday Firm. Hasha, et al. v. City of Fayetteville, et al., No. 92-

578 (Jan. 19, 1993). Chief Justice Holt joined the majority opin-

ion.

‘Chief Justice Holt took the bench in 1985. A computer search

using Case Base, a research database with Arkansas cases on

CD-ROM, was conducted for all cases since 1985 authored by

“Holt” in which “Friday” occurred in the “Attorneys on Appeal”

segment of the official report. Each case was then verified in-

dividually and the outcome recorded.

opinions favored the Friday Firm. Thus, in nearly

two-thirds of the cases Chief Justice Holt rendered

an opinion adverse to the Friday Firm. A table listing

all eighteen cases and the outcome of each is attached

hereto as Appendix 7.

The opinions by Chief Justice Holt adverse to the

Friday Firm include one 4-3 decision in a case of first

impression that easily could have gone the other way.

Mr. Friday was a signatory to the brief in that case.

Moore v. Missouri Pacific R.R., 299 Ark. 232, 773

S.W.2d 28, 6 A.L.R. 5th 1188 (1989). In another case,

Chief Justice Holt wrote the majority opinion against

the Friday Firm and then dissented when rehearing

was granted and the Court ruled in favor of the Fri-

day Firm. Register v. Oaklawn Jockey Club, Inc., 306

Ark. 318, 811 S.W.2d 315, opinion on reh’g, 306 Ark.

321, 821 S.W.2d 475 (1991).

Further, petitioner misstated several Arkansas and

United States Supreme Court decisions in support of

his assertion that the Arkansas Supreme Court was

required to recuse itself in this matter. In Johnson

v. Sturdiwant, 295 Ark. 622, 758 S.W.2d 415 (1988),

Justice John Purtle authored an opinion by the di-

vided Arkansas Supreme Court in which a $5,000,000

plaintiff's award was affirmed. The critical issue in

the underlying case was whether the driver of a log

truck involved in an accident was an independent con-

tractor so as to insulate other defendants. At the

time, Justice Purtle had a claim against one of the

insurance companies representing a defendant and

that claim related to an issue of an independent con-

tract which, as noted, was the main issue in Stur-

divant. In recognizing the need for recusal, the

Arkansas Supreme Court relied upon Aetna Life Ins.

Co. v. Lavoie, 106 S.Ct. 1680 (1986) and particularly

noted that in the Aetna case “‘it was suggested that

Justice Embry had written an opinion deciding his

own lawsuits.”’ In light of Aetna and Lilejeberg

v.Health Services Acquisition Corp., 486 U.S. 847

(1988), the Arkansas Supreme Court recused. Neither

Johnson v. Sturdivant or Aetna Life Ins. Co. v. Lavoie

have any precedential value for this case. Justice Holt

did not have any personal interest in the case nor

did he have a personal involvement with any of the

parties.

Petitioner also cites City of Jacksonville v. Venhaus,

302 Ark. 204, 788 S.W.2d 478 (1990) and Patterson

v. R.T., 301 Ark. 400, 784 S.W.2d 777 (1990) in sup-

port of his contention that his due process rights have

been violated. However, in Venhaus, the record clearly

reflected that the chancellor exhibited bias and had

a personal interest in the matter exhibited by order-

ing that $700,000 of taxpayers funds be given to as-

sorted charities to which she was connected. Likewise,

in Patterson v. R.T., the same chancellor exhibited

her bias when questioning witnesses on the record.

Conversely, in the instant action Justice Holt exhib-

ited no bias and, in fact, had no relationship or in-

terest with any of the parties to the litigation.

Much of petitioner’s brief in support of Petition for

Certiorari is devoted to rearguing the underlying

case.’ However, the only real issue determined by the

’ Included as a part of petitioner’s effort to reargue the case

is Appendix Ex. A to the Brief, which purports to be ‘“‘an excerpt

from the testimony of witnesses and exhibits at trial.”’ In fact,

it is a tendentious, argumentative, and selective abstract of tes-

timony that takes much out of context and actually fabricates

Arkansas Supreme Court was whether there was sub-

stantial evidence that First Pyramid engaged in

fraudulent concealment of petitioner’s claim. There

was and is no evidence, much less substantial evi-

dence, of fraudulent concealment. The fraudulent con-

cealment issue was argued extensively in briefs filed

before the Arkansas Supreme Court and at oral ar-

gument. Simply put, there is no evidence of an im-

propriety by the Arkansas Supreme Court and there

is no need to reargue the limitations issue.

B. The State of Arkansas Did Not Violate Petitioner’s

Right To Due Process And Tulsa Professional Col-

lection Services, Inc. v. Pope, 485 U.S. 478 (1988)

Is Inapplicable.

Petitioner suggests that the opinion of the Arkan-

sas Supreme Court is contrary to Tulsa Professional

Collection Services, Inc. v. Pope, supra. That asser-

tion, like so much of petitioner’s counsel’s argument

is misplaced. The issue in Pope was whether the in-

volvement of the Oklahoma probate court in executing

the non-claim provision of the. probate code consti-

tutes state action under the Fourteenth Amendment.

485 U.S. at 486. Nothing in the Arkansas Supreme

Court’s opinion in this case even remotely addresses

that issue. The opinion in Pope is crystal clear that

a private party may invoke a statute of limitations

without implicating due process. Jd. Therefore, the

part. See the addendum to this brief. Petitioner did not complain

about respondent’s abstract of these matters before the decision

on the merits (Cf. Rule 9(eX1)), but now he has re-abstracted

the evidence to suit his purposes, a clear violation of Rule 9(d).

Among other things, this new, partial argumentative abstract

violates the requirement that the abstract be ‘‘without empha-

sis.”’

EEO

Pope opinion and the opinion in this case of the Ar-

kansas Supreme Court of December 21, 1992, are

entirely consistent.

It should also be noted that this section of the

Petition for Writ of Certiorari reveals the inconsist-

encies in petitioner’s positions, and the desperation

of petitioner’s counsel to attempt to resurrect his mul-

timillion dollar verdict. Petitioner twists and turns the

law to suit his purpose. On the one hand, the

petitioner has repeatedly argued that the estate was

unaware of its potential claim until ‘‘8/8/88’’ because

the only person with notice was the executor, Steve

Stoltz, who had a conflict of interest with the other

beneficiaries. Therefore, petitioner argues the statute

of limitations was tolled until the estate received no-

tice independent of the executor.

At trial, however, it was revealed that a sister of

J.P. Stoltz and a brother-in-law (both of whom are

estate beneficiaries represented by petitioner) had ac-

tual notice that J.P. Stoltz had at one time named

his estate as the beneficiary of the life insurance pol-

icy. The opinion of the Arkansas Supreme Court noted

this fact and now petitioner cries foul and asserts

that the estate cannot be held accountable for knowl-

edge possessed by other beneficiaries. Petitioner, thus,

apparently concedes that notice to the executor and

the attorneys for the estate was the only notice that

could, and did, bind the estate. See e.g. Ford’s, Inc.

v. Russell Brown & Co., 299 Ark. 426, 773 S.W.2d

90 (1989); Ingram v. Luther, 244 Ark. 260, 424

S.W.2d 546 (1968); Farr v. Newman, 14 N.Y.2d 183,

199 N.E.2d 369 (N.Y. App. 1964). Since the executor,

the estate attorneys and independent beneficiaries all

received notice of the potential claim, petitioner is

forced to take inconsistent positions in an attempt to

have his cake and eat it too.

In summary, this Court has previously held that a

private person’s assertion of an applicable statute of

limitation does not constitute state action. Thus, there

was no due process violation and, further, notice was

proper and binding on the estate.

CONCLUSION

The petition filed in this matter, like other plead-

ings filed by petitioner, does nothing but repeat ar-

guments already made, considered and rejected.

Further, the petitioner makes the irresponsible and

scandalous assertion that the Arkansas Supreme Court

issued a fraudulent opinion based on nothing more

than an unfounded rumor that the Chief Justice al-

legedly went quail hunting and participated in other

social activities with Herschel Friday of the Friday,

Eldredge & Clark law firm. “Judges are presumed

to be impartial and the party seeking disqualification

bears a substantial burden proving otherwise.’’ Ko-

rokov v. Korokov, 33 Ark. App. 194, 197, 803 S.W.2d

948 (1991). Petitioner is light years away from meet-

ing this burden. Neither First Pyramid nor the ju-

dicial system should be held hostage to the kind of

tactic that has been the pattern in this case. It is the

duty of the Court to stand up and say, enough is

enough. Giving in to petitioner’s tactics would be like

giving in to terrorists who threaten destruction or

murder unless ransom money is paid. It only en-

courages the same kind of behavior in the future.

August 25, 1993 Respectfully submitted,

*JoHN E. Tu. III

PETER G. KUMPE

LEON HOLMES

WILLIAMS & ANDERSON

111 Center Street

Twenty-second Floor

Little Rock, AR 72201

(501) 372-0800

Attorneys for Respondent

*Counsel of Record

APPENDIX

APPENDIX 1

MEMORANDUM

RE: First Pyramid Policy Issued to James Patrick

Stoltz, Deceased

DATE: January 18, 1978

SITUATION: James Patrick Stoltz died December 18, 1977

while covered by four policies issued by First Pyramid.

Two of these policies were connected with the Flex 70

Trust totalling $2,000,000.

Jim Duran requested that we review the policies prior to

payment, to make sure proper payment is being made. In

doing so, certain discrepancies were noted concerning the

$1,950,000 term policy. The $50,000 whole life policy may

have similar problems and should be reviewed. The purpose

of this Memorandum is to highlight the sequence of events

concerning the problem and the possible positions and

courses of action which may be available.

I. Sequence of Events:

1. $1,950,000 Policy was issued to “‘The Insured” dated

February 26, 1976 and named “The Estate of the Insured”

as beneficiary.

(Line 29 in the application where “owner” designated

is garbled) (Dated 12/18/75) (Applicant shown as Flex 70

Trust however).

2. Transfer of Ownership and Beneficiary Agreement

signed by the Insured as ‘“‘Policyholder” on May 1, 1976,

naming James Stephen Stoltz (son) as owner and primary

beneficiary.

The Agreement was filed and record made by Company

on March 22, 1976 Title page on policy changed to strike

“Insured”’ and show James Stephen Stoltz, son, as owner,

but beneficiary left as “The Estate of the Insured” on

face of policy. File copy has notation that beneficiary was

changed by rider and the same may have been inserted

in the policy.

3. Ron Mason memo to Paul Dixon on August 9, 1976

that changes in ownership are ineffective without Trustee’s

signature. Requested new change forms be completed if

Mr. Stoltz still wants change, or return of policy for re-

moval of previous change of ownership otherwise. (Bene-

ficiary not referred to)

4. Worksheet prepared by A. Gray on 8/18/76 directing

that new policy be typed showing ownership as “Flex 79

Trustee” and directing removal of 3/1/76 ownership trans-

fer from policy. No written direction or consent by insured

or son present found in file. Acknowledged 8/31/76.

5. New (substitute) policy issued 8/76 showing as owner

“The Insured and Flex 70 Trust” dated February 26, 1976

and naming as beneficiary ‘The Estate of the Insured.”

Any prior beneficiary rider which may have been included

was apparently removed.

6. Immediately prior to death, J. Moses responding to

inquiry by agent stated that son is owner and beneficiary

which agent responds is proper. Agent requested copies

of March, 1976 ownership and beneficiary changes, which

are supplied.

7. December, 1976, Mr. Stoltz dies.

8. December 20, 1976, Jim Duran notified David Kane

that son is beneficiary and requested claim for completion

and return of policy which is done.

II. Analysis:

The objective in determining how to properly make pay-

ment at this time is to prevent, if possible, exposure to

suit by another party at a later date claiming payment

should properly have been made to such party.

i errrrerereeeereeneemnnaaaniieiiiiiiiiiial

INTENT OF PARTIES: All indications at this time are that

the intent of the parties was that the son be beneficiary

of the policy.

Judy Moses understands the purpose of the August, 1976

change was to name the son as owner and beneficiary ab

initio to avoid the possibility of the policy being pulled into

the insured’s estate and possibly avoid its seizure by taxing

authorities for income taxes allegedly due. She believes it

was erroneous to name the insured or his estate in any

fashion on the policy page prepared in August dated Feb-

ruary 26 1976.

Elizabeth Oswald understands the purpose of the August,

1976 change was to show how the policy should have orig-

inally been issued pursuant to the application (Insured and

Flex 70 Trust as owner and Estate as beneficiary) and

that the March, 1976 ownership and beneficiary changes

were intended to remain in force, (despite the fact that

this is inconsistent with the Mason memo requiring the

Flex 70 Trustee’s signature for this to occur).

She believes it was erroneous not to include the ownership

and beneficiary changes as riders at that time.

The agent in December, 1976 conversation with Judy Moses

(prior to Insured’s death) expressed satisfaction with her

statement that the son was owner and beneficiary at that

time stating this was the intent of Mr. Stoltz.

SON AS BENEFICIARY: The designation of the insured’s

son as owner and beneficiary would seem to be effective

under the following circumstances.

1. If the fact that the policy was originally issued in-

consistent with the application does not control over the

actual policy specifications; if the insured had the power

to change ownership and beneficiary in March, 1976 and

did so, and if the August, 1976 change is of no effect

since not authorized or consented to by the owner of re-

cord when accomplished. Mason’s memo would have been

incorrect when written under this reasoning. The fact the

policy when actually reissued did not reflect these changes

must also be considered as having no effect.

2. The second line of reasoning leading to this result

would follow the reasoning of #1 except that the August,

1976 changes dated February, 1976 were permissible be-

cause of consent or otherwise effective ab initio, and the

March, 1976 ownership and beneficiary changes are effec-

tive because they follow the effective date of the changes.

This reasoning must disregard the Mason memo requiring

Trustee signature, by reasoning that some type of consent

is present, as well as the fact the changes were not in-

cluded as riders in the policy. (Oswald understanding)

3. As a third alternative, consider #2 except that the

policy as originally issued was inconsistent with the ap-

plication and the application controls.

4. A fourth line of reasoning would be that the August

change should have named on the policy specification page

the son as owner and beneficiary, removing any need for

new beneficiary and ownership change forms and all par-

ties were consenting to this despite fact no written record

was present. This also assumes this clerical correction may

be made at this time.

There are certain other variations but these are the

principal themes. It should be noted that none seems fully

satisfactory from a contract law standpoint since certain

terms of the contract must be ignored, proper signatures

were not obtained, or required by the Company, certain

changes must be allowed “‘ab initio” which is of question-

able validity, especially in the absence of a clear intent,

etc.

ESTATE AS BENEFICIARY: Circumstances which would

indicate that the Estate of the insured is the proper ben-

eficiary are as follows:

rea ieaenienianainetieaeiaaeinecennee el

(a) If the signature of the trustee was required |

at any point and was not obtained. (Several var-

iations)

(b) If the final policy page prepared as the most

recent statement of Company ownership and ben-

eficiary records,to which the insured could have

objected if he desired to, controls.

III. Alternatives:

The principal dangers of each course of action involves

exposure to (a) contract liability to another party after

payment to a first party had been made and (b) tort lia-

bility for negligence or misrepresentation to a person other

than the person to whom payment was made. Various

procedures which could be followed to possibly cut off such

actions include use of interpleader or formation actions to

clarify the contract, obtaining indemnity or waiver agree-

ments to cover possible liability, etc.

Contract actions could conceivably arise regardless of

whom payment was made to. These could possibly be suc-

cessful if the court construed the situation contrary to the

Company’s interpretation.

A similar situation is present with tort actions if a court

found that the intent of Mr. Stoltz was to make payment

one way and, through error by the Company, or perhaps

its agent, this intent was not carried out. The information

we have at this point is that the intent was to benefit the

son. The possibility that someone else could come forward

later with contrary evidence cannot be ignored.

The estate and the son do have adverse interests in this

case. Though the son is executor of Mr. Stoltz’s will, the

will leaves the residue of the estate to First National Bank

in Little Rock as trustee of a trust for about fifteen dif-

ferent parties. If anyone had the understanding these pol-

icy funds would pass to such trust, particularly if no other

significant assets pass to the trust, further inquiry may

be forthcoming from the Trustee or beneficiaries of the

trust.

The advantage of interpleader or reformation actions is

that contract actions by other parties should be cut off.

However, this may have no effect om negligence actions

and would alert all parties te the probiem. John Peace is

preparing a memorandum on this aspect of the case.

If payment was made to the son, an indemnity agreement

from him could reduce exposure. The indemnity agreement

would be broadly drawn. Exposure to a negligence suit by

the estate if the intent of the insured was found to be to

leave the proceeds of the policy to the estate and trust

established in the will would still exist.

I.R.S. PROBLEM: We do not know whether more taxes

would be due if proceeds are paid to the beneficiary or

to the estate. It is possible, for example, that the I.R.S.

might take the position the proceeds were payable to the

estate if more taxes would be due than if paid to the son.

We mention this only to raise the question as an item for

consideration.

REINSURER: Since a substantial amount of the proceeds

are from reinsurance, the question arises should the sit-

uation be discussed with the reinsurer. We mention this

aspect only to make sure all important items are consid-

ered.

$50,000 POLICY: A review of the $50,000 Flex 79 whole

life policy originally issued in the same manner as the

$1,950,000 policy indicates that no ownership change form

was executed regarding it in March, 1976, a beneficiary

change only being signed, naming the son as beneficiary.

When the August 1976 changes were made, instead of a

new policy page being typed the phrase ‘‘and Flex 79

Trust” was added as “The Insured’’ in the ownership

blank, but no change was noted as to the beneficiary des-

ignation of ‘‘The Estate of the Insured.” Any beneficiary

change rider which may have been present was apparently

removed at that time.

On this basis, the analysis of the situation on this policy

would be the same as for the $1,950,000 policy.

SUMMARY: There is a substantial risk whether payment

is made to the son or to the estate.

(a) There appears less risk if payment is made to the

son since those involved seem sure he was the intended

beneficiary.

(b) There appears more risk if payment is made to the

estate because of the insured’s apparent intent to benefit

the son.

quiring an indemnity agreement from either the son or

the estate.

(d) An interpleader action is probably the safest course.

However, the Company could be exposed to a suit from

the loser, i.e. the son or the estate. Therefore, this alter-

native is not a complete solution either.

APPENDIX 2

January 12, 1993

Charles Phillip Boyd, Jr.

Davidson Law Firm, Ltd.

P. 0. Box 1300

Little Rock, AR 72203

Dear Charlie;

I am writing to inform you of some very upsetting rumors

I have heard in the last couple of weeks.

I was told that Chief Justice Holt has a very close personal

relationship with members of the Friday Law Firm. I heard

from a reliable source that he has been quail hunting in

Mayflower on Mr. Friday’s land and went on a hunting

excursion in Texas on Mr. Friday’s plane. Charlie, if these

rumors are true I would think this relationship could pos-

sibly affect Judge Holt’s opinion in our case. I feel this

is terribly wrong and unethical.

Charlie, as you well know I have felt very strong about

the way the Friday Firm handled my dad’s estate. I still

feel they played a major role and are at the root of many

of our problems today. Judge Holt, I would think, would

be well aware of the Friday Firm’s possible exposure in

this case if he read the transcript. Also you may recall

during your oral argument in front of the Supreme Court

that one of the judges pointed out the Friday Firm’s pos-

sible exposure.

Charlie, I’m not a lawyer but I would think that if these

rumors are true Judge Holt should have stepped down

from this case just like Judge Dudley. At the very least,

ethically he should have disclosed this conflict.

On behalf of myself and as special administrator for the

estate I want you to investigate these rumors immediately

iaiatiniieteanaiinieaialininirniea anil

and see if there is any validity to them and notify me of

my legal options.

Sincerely,

/s/ Mike

Mike Stoltz

10a

APPENDIX 3

IN THE ARKANSAS SUPREME COURT

NO. 92-4

FIRST PYRAMID LIFE INSURANCE COMPANY OF

AMERICA; USABLE INSURANCE COMPANY

APPELLANTS

VS.

J. MICHAEL STOLTZ, As Special Administrator of the

Estate of J.P. Stoltz, Deceased

APPELLEE

PETITION AND BRIEF FOR REHEARING

This Court’s Opinion contradicts and/or ignores the

sworn testimony of the witnesses who testified, under oath,

before a jury, in these proceedings, the documents intro-

duced into evidence, and the law read to the jury by way

of Instructions without objection. The Court’s Opinion con-

travenes universal law by holding that knowledge (assum-

ing arguendo that same exists here) obtained by a distant

heir, and a potential stranger to the Estate, somehow

constitutes notice to the Estate, and its minor children,

of their rights and obligations, thereby violating the Four-

teenth Amendment to the U.S. Constitution. The Appel-

lee’s counsel certifies his belief that this Petition has merit,

and is not filed for the purpose of delay.

FACTS

First Pyramid Life Insurance Company (FPL) wrote a

policy of life insurance totalling $2 Million on the life of

J.P. Stoltz. The contractually designated beneficiary was

lla

his Estate. (R.3690) There was conflicting evidence re-

garding whether the deceased insured wanted his eldest

son, or his Estate, to be the beneficiary, but as a matter

of contract, on paper, in black and white, the Estate was

the designated beneficiary.

The Defendant insurance company saw it had a problem

when the insured died due to the manner in which it had

handled its paper work. It called in its attorneys for advice

on what it should do.

Both of its attorneys recognized the beneficiary dis-

crepancy, and advised it that interpleading the money was

the safest course of action to take, but that said action

would “alert’’ the losing party to its potential claim, and

could subject, or expose, the insurance company to a law-

suit from the loser. (R.4540-4) This ‘“‘discrepancy in the

proper beneficiary’’ was not, at any time, passed on to

the Estate by the insurance company. (R.3949, 3959-60)

On the same date it received these Memos from its

attorneys, the insurance company allegedly had a meeting,

wherein the alternative of interpleading the money, and

its concurrent exposure to a lawsuit by the loser, was

discussed. The insurance company decided to pay the son,

because he was the only one who had made a claim for the

proceeds, and was the only one who thought he had a claim

to the proceeds. (R.4354-55) The Estate was never told it

had a potential claim to the proceeds. The insurance com-

pany decided that, if it was subject to being sued by the

loser if it alerted all parties to their potential claim, it

would be better off to pay the son, who knew he had a

claim, and had made a claim, and take its chances that

the other entity with a claim to the proceeds, i.e. the

Estate, would never find out about same.

The Estate had numerous debts, and was involved in a

procedural morass that could last decades based on the

Will of the deceased. First National Bank was the Estate’s

largest creditor, and was also the Trustee of the Trust to

12a

which these proceeds would have passed had the Estate

been paid. Paying the money to the son, in addition to

the aforementioned motivational factor, would potentially

keep the money out of the Estate, and, if the Bank re-

quired Steve Stoltz to sign a personal guarantee insuring

a $1.62 Million debt, for which Polyvend stock was pledged,

it could assure itself of being paid. Steve Stoltz would see

this debt was paid off, because the alternative was selling

a multimillion dollar company, Polyvend, which was his if

he could run it for ten (10) years. If he sold the company

within a ten (10) year period of time from his Father’s

death, he would have to split the excess surplus with his

Brothers and Sisters. Furthermore, Herbert Thomas, the

owner of FPL and the largest stockholder of the Bank,

would have a way of ensuring that the Bank’s debt was

paid.

The Friday Law Firm represented J.P. Stoltz while alive,

Steve Stoltz as Executor of the Estate, Steve Stoltz in-

dividually, First National Bank as the largest creditor of

the Estate, First National Bank as the Trustee to which

these proceeds would: have flowed had the Estate been

paid, the Defendant insurance company itself, Polyvend

Corporation, and the insurance agency which sold the pol-

icy to the deceased, at all pertinent times. (R.3891/3907)

Herbert Thomas, who owned the insurance company, was

the largest stockholder of the Bank. Buddy Sutton, one

of the senior partners of the Friday Law Firm, was on

the Board of Directors of the insurance company. Herschel

Friday was on the Board of the Bank. (R.3947-48) In ad-

dition to the aforementioned reasons, theinsurance com-

pany, and the Friday Firm, would rather Steve Stoltz be

paid than the Estate because it is much easier to control

and manipulate one twenty-five (25) year old man to their

mutual advantage than it is an Estate comprised of nu-

merous individuals and entities (both local and national),

Banks, Trusts, Probate proceedings, litigation, etc. Within

six (6) days after paying Steve Stoltz the proceeds, he

aerial

13a

bought $3,000,000 worth of insurance from FPL, and ar-

ranged the purchase of large FPL policies for two of the

employees of Polyvend, the corporation he took over from

his Father. (R.4413-15, 4804-05)

The IRS included the $2 Million worth of insurance pro-

ceeds in the deceased’s Estate. The Estate paid the tax

on money it did not receive. The Friday Law Firm sued

the IRS for a refund on behalf of the Estate. During this

period of time, if not before, the Friday Firm saw FPL’s

files. They tendered to the IRS certain FPL files regarding

these policies, but whited out certain portions. The IRS

ultimately settled the case for almost what it claimed in

the first place, and told the Estate, through the Friday

Firm, that it had whited out certain portions of these files,

and that the Estate never did prove that it was not in

fact the proper beneficiaries of these policies. The Friday

Firm was legal counsel for the insurance company also at

this time, and had members on its board. These actions

were done to protect First Pyramid as much as to benefit

the Estate.

There is conflicting evidence regarding whether or not

Steve Stoltz was ever told of the Estate’s potential claim

to these proceeds. A letter from James Saxton dated June

7, 1983 tells him the Estate has a potential claim, but also

tells Steve Stoltz, as Executor and individually, that he

has not reviewed the entire insurance company file. James

Saxton and Steve Stoltz both testified at trial that neither

Steve Stoltz, nor James Saxton, ever apprised the Estate

that it had a potential claim because James Saxton was

of the opinion Steve Stoltz was the proper beneficiary.

(R.4799) Unequivocably, no one else in the Estate was ever

told by FPL it had a potential claim to these proceeds.

(Regardless, FPL did not submit a single limitations In-

struction, never told the jury it had a normal five (5) year

statute of limitations, nor that notice to an attorney is,

absent a conflict, notice to the client, thus bringing about

a “‘conflict’’ instruction from the Plaintiff. So, what dif-

14a

ference should all this make? This Court addresses same

in its Opinion so it is cursorily discussed here.)

No distributions of any kind have been made in this

Estate, and said Estate is subject to numerous lawsuits

filed in the Chancery and Probate Courts of Faulkner

County. (R.4603) The First National Bank of Little Rock

would have pursued this matter on behalf of the Estate

had it been told the Estate had any potential claim to

these proceeds. (R.3950-53) The attorneys for FPL advised

it of said Trustee’s probable actions if it were apprised of

the Estate’s claim, and yet neglected to apprise the Estate

of same. Furthermore, FPL was apprised of the conflicts

of interest between the son receiving this money individ-

ually, and serving as Executor of the Estate, prior to

paying the money. (R.4548-49)The son was required to sign

an Indemnity Agreement when he received these proceeds.

The only time FPL had an individual sign an Indemnity

Agreement was when it was afraid someone else had a

claim to the policy proceeds, and wanted to reduce its

exposure. (R.4354-55, 4544-45)

Sometime around September of 1987, several members

of the Estate began to question the way the Estate was

being managed by the Friday Law Firm and Steve, whom

said firm was “advising” individually. They secured the

services of new attorneys to assist them in investigating

the Estate, and were apprised, for the first time, on Au-

gust 8, 1988, that the Estate had a potential claim to

these proceeds, or that Steve Stoltz had been paid instead

of the Estate. (R.3864-67) They were in shock, and felt

like they had been lied to. (R.4593-96) This is the first

knowledge the majority of the members of the Estate had

that the Estate was ever the beneficiary of these policies.

An elderly Aunt and Uncle testified they had been told

that the Estate was the beneficiary prior to the insured’s

death. However, they had never been told the Estate had

not been paid, and, despite reasonable diligence and vilig-

ence, were not apprised of same prior to August 8, 1988.

15a

(R.4844//859) This Aunt and Uncle thought the Friday Firm

was looking out for their best interest, and, being as no

property had passed through the Estate to the heirs and

beneficiaries, had no reason to suspect that they would

not receive whatever money they had coming, along with

the other heirs and beneficiaries, at the time the Estate’s

property was distributed.

The Last Will and Testament of the deceased indicates

that the nine-(9) Brothers and Sisters, the aforementioned

Aunt and Uncle, Hendrix College, and St. Joseph Catholic

Church were to receive the income from the property of

the Residuary Trust, i.e. these insurance proceeds, as long

as the heirs and beneficiaries lived. Upon the death of the

last heir/beneficiary, the corpus of the Trust was to pass

to St. Joseph and Hendrix College. Thus, the elderly Aunt

and Uncle were only supposed to receive a pro rata split,

along with eleven (11) or so other individuals/ entities,

during their life time. (D.’s Exh. 149) The jury inferred,

as the law allows them to do, and as anyone using common

sense would, that the income from the life insurance pol-

icies was not that big a deal. Being lied to was.

A lawsuit was filed on April 20, 1989. A Pulaski County

jury found the Estate was the contractually designated

beneficiary, and rendered a verdict on same. The record

indicates the Trial Court complimented the jury throughout

the trial on its attentiveness. The Supreme Court has the

obligation to give deference to this fact.

Regardless of how this Court views the evidence, no one

can state that the foregoing dissertation of facts is not a

reasonable conclusion by a reasonable jury, and supported

by substantial evidence. This Court may not want this to

be the result, may not want the jury to have found this

way, may not think the decision was right (although no

one who sat through the trial and viewed same in an

impartial manner could possibly hold otherwise), but,

nevertheless, unless it totally disregards the sworn testi-

16a

mony of the warm bodies who took the witness stand in

front of the jury,and the documents from FPL’s own file,

it must uphold this verdict. To hold otherwise, would make

our jury system a sham. Why not just submit Affidavits

to the Supreme Court and allow it to decide the facts, the

law, and the decision? That is strong language from the

Appellee. But, he has the transcribed record in his pos-

session to back him up, and will stand, flat footed and

entrenched, upon same. (See Abstract of testimony at-

tached to Brief in Support of Motion for Vacatur, To Dis-

qualify And, In The Alternative, To Appoint A Special

Master, And Motion For Extension Of Time To File

Petition For Rehearing, filed January 18, 1993.)

APPLICABLE LAW

This Court knows the law when viewing a jury verdict

on Appeal. If there is any substantial evidence to support

the jury verdict, same is not disturbed. The evidence is

viewed in the light most favorable to the party in whose

favor said verdict rests. This Court does not weigh the

facts for the purpose of determining in whose favor the

preponderance of the evidence lies. Kratzkev Nestle v.

Beich, Inc., 307 Ark. 158, 817 S.W.2d 889 (1991); Missouri

Pacific Railroad Co. v. Clark, 246 Ark. 824, 440 S.W.2d

198 (1969). The reviewing Court cannot disturb the jury’s

conclusion as to substantiality of the evidence unless there

is no reasonable probability in favor of the Appellee’s ver-

sion, and then only after giving legitimate effect to all

presumptions in favor of the jury’s findings. The jury is

the sole judge of the credibility of the witnesses. Beard

v. Coggis, 249 Ark. 518, 459 S.W.2d 791 (1970); Bradbury

v. Gower, 247 Ark. 704, 447 S.W.2d 247 (1969).

Fraud, or fraudulent concealment that will toll the stat-

ute of limitations, is a question of fact that can be inferred

from the evidence, just as any other fact. Moore Ford Co.

17a

v. Smith, 270 Ark 340, 604 S.W.2d 943 (1980). Court’s

Instruction No. and 9. (R. 4875/4878) The question of

fraudulent concealment, and the concurrent tolling of the

statute of limitations, is a fact question judicially recog-

nized as such by this Court for decades. Crossett Health

Center v. Crowell, 221 Ark. 874, 256 S.W.2d 548 (1983);

Schenebeck v. Sterling Drug Co., Inc., 423 F.2d 989 (8th

Cir. 1970); Mulligan v. Lederle Laboratories, 786 F.2d 859

(8th Cir. 1986); Robinson v. White, 633 F.Supp. 954 (W.D.

Ark. 1986).

For reasons that will be gone into in greater detail later,

the Appellee is convinced no one on this Court carefully

read the entire record of these proceedings. In fact, the

attorney for the Appellee has been told by a member of

the Court that this Court generally does not read the

record itself because of the time constraints involved, and

because it is not going to overturn questions of fact unless

same are absolutely, unequivocably, unargumentatively un-

supported. The reason for same is that this Court cannot

glean the demeanor of the witnesses, their facial expres-

sion, their tone of voice, etc. from a cold transcript. The

cold hard fact is that there is no conceivable way the six

(6) members of this Court assigned to hear this matter,

and probably not the Chief Justice himself, had time to

read - one time - the entire transcript. Same is probably

not necessary if an issue of law is to be decided, and that

is what this Court is supposed to do. But, it is inconceiv-

able this Court can properly overturn a question of fact

when it was not present in the Courtroom along with the

Trial Judge, live witnesses, a jury, and numerous other

individuals. Furthermore, how can this Court, in discharg-

ing its obligations to the people of the State of Arkansas,

overturn a question of fact when it does not even read

the transcript? A reading of the Abstract, regardless of

how well it,s done, is simply insufficient.

The undersigned knows that one of the three volumes

of testimony from witnesses, including witnesses whose

18a

testimony is taken out of context by this Court, was ac-

tually misplaced. The Appellee wonders when and where

it was misplaced, and how it was found. Obviously, no one

can read a transcript that cannot be located. The Court

does follow the “inferences” advocated by the Appellant

in its Opinion. There was ample other testimony contained

in this volume to counter any such inference, were the

testimony from all witnesses read, and all inferences from

said testimony read in the light most favorable to the

Appellee.

This Court is an Appellate and is supposed to review

and decide issues of law. What is the issue of law advanced

on Appeal that merits a reversal of this jury’s verdict?

The verdict is sound unless this Court chooses to overturn

a question of fact supported by ample evidence, or chooses

to simply state, in a manner that is clearly erroneous, that

“no” such evidence exists. The record indicates the truth

is to the contrary. (See also Instructions Nos. 12 and 14,

where the jury had to find fraud and conduct warranting

punitive damages because same were awarded.) (R.4878-

80) Instruction No. 8 was given to the jury without ob-

jection. (R. 4877-78) In fact, the last sentence was added

to same by defense counsel himself! This Instruction makes

fraud, fraudulent concealment, and a concurrent tolling of

the statute of limitations, a factual issue. With no objection

to the presentation of this Instruction to the jury, the

jury’s finding becomes the “law of the case.” The jury

had to find the Estate was the beneficiary, to find for the

Plaintiff in the first place. See also Instruction No. 12.

(R.4878) Hence the insurance company had the affirmative

obligation to speak, and by its silence is guilty of fraud

and the tolling of the statute of limitations. This Court is

substituting its view of the evidence to support the decision

reached in its Opinion, in the face of compelling legal and

factual precedent that dictates otherwise. Same is im-

proper. Metropolitan Life Insurance Co. v. Williams, 197

Ark. 883, 125 S.W.2d 441 (1935).

19a

This Court quotes the Trial Court’s “Findings of Fact’

on pg. 7 of its Opinion, and states that to prove fraud,

the Plaintiff must show:

Overt acts caused the legal right to be hidden ... or

there existed a specific legal relationship between the

parties that obligated an overt disclosure .. .,

and agreed with said analysis. The aforementioned Jury

Instruction makes this a closed issue. If the Estate was

the beneficiary as the Defendant itself told the jury, the

insurance company had the affirmative obligation to seek

out the Estate, notify the skilled fiduciaries and Trustees

at First National Bank, interplead the money to alert the

Estate and the attorneys for these minor children, notify

the Probate Court of Faulkner County that said proceeds

should be payable to the Estate, ... Doing nothing is

fraud. It cannot sit back and wait on an Aunt and Uncle

to file a lawsuit. It has an affirmative obligation to speak.

We don’t have to worry about the “legal relationships

between the parties.’”’ Camp v. First Federal Savings and

Loan, 12 Ark. App. 156, 71 S.W.2d 213 (1984).

These facts, coupled with the Instructions, coupled with

the fact that the insurance company submitted no Instruc-

tion, whatsoever, even telling the jury it had a statute of

limitations defense, effectively prevents the Defendant

from raising this issue on Appeal. When a party requests,

or acquiesces in, an Instruction submitting particular issues

to the jury, that party is not entitled to thereafter com-

plain about the jury,s determination of such an issue.

Farmers Coop Assoc. v. Garrison, 248 Ark. 948, 454

S.W.2d 644 (1970); Willis v. Elledge, 242 Ark. 305, 413

S.W.2d 636 (1967). See also Rule 51 of the Arkansas Rules

of Civil Procedure. If a party does not proffer a Jury

Instruction embodying and articulating his theory and all

defenses, the failure to do so constitutes a waiver. Dodson

Creek. Inc. v. Fred Walter Realty Co., 2 Ark. App. 128,

620 S.W.2d 947, 952 (1981). The failure to object to an

20a

Instruction bars a party from raising the applicability of

the doctrine espoused in same on Appeal. Northland Alu-

minum Products, Inc. v. Creative Cookware. Inc., 678 F.2d

746 (1982); Rowe International, Inc. v. J.B. Enterprises’

Inc., 647 F.2d 830 (8th Cir. 1991). It doesn’t matter that

the party moved for a Directed Verdict, or that it wants

to hang its hat on the issue being a matter of law. It has

to object to the Instruction being given to the jury, or

said objection is waived. Absent same, the Jury Instruc-

tion, the jury’s finding, is the law of the case.

(b) NOTICE TO RITA FIELDS AND JACK SMITH

This Court mistakenly states that even if fraud is pres-

ent, same is somehow cured because two (2) elderly in-

dividuals, one an heir of the Estate, and one a possible

heir, who may have gotten l/Ilth of the income off of the

interest from these proceeds during their limited lifetime,

had knowledge the Estate was the beneficiary of these life

insurance policies, and saw financial statements indicating

same, prior to the insured’s death.

In the first place, it has been the rule of law in Arkansas

for more than a century that any claim on behalf of the

Estate must be brought by the Executor of Administrator

of the Estate. Whelan v. Edwards, 31 Ark. 723 (1877).

The Defendant itself moved for Summary Judgment be-

cause the heirs of the Estate were attempting to bring a

cause of action to recover these insurance proceeds instead

of the Executor. J. Michael Stoltz had to be appointed

Special Executor to proceed forward in this lawsuit. Isn’t

there a clique, somewhere that states what’s good for the

goose is good for the gander?

The Estate is an entity in and of itself. Only the Ex-

ecutor, or one appointed Special Executor, can receive

“Notice” that can bind the Estate. A.C.A. # 28-1-112. The

United States Supreme Court has held that any creditor

of the Estate must be given specific and actual notice if

2la

their identity is ‘reasonably ascertainable,” and that to

take one,s property without providing same violates the

due process clause of the Fourteenth Amendment of the

United States Constitution. Tulsa Professional Collection

Services, Inc. v. Polk, 485 U.S. 478, 108 S.Ct. 1340, 99

L.Ed. 2d 565 (1988); citing Mellane v. Central Hanover

Bank & Trust Co., 339 U.S. 306, 70 Sup.Ct. 652, 94 L.Ed.

865 (1950) and Menonite Board of Missouri v. Adams, 462

U.S. 791, 103 Sup.Ct. 2706, 77 L.Ed.2d 180 (1983).

Taking this one step further, and assuming for purposes

of argument that the Aunt and Uncle had notice, which

is debatable, and that the Uncle by marriage even had a

claim, which is unlikely, no one, not this Court’s law clerks

nor opposing counsel, will find a case that holds that notice

to an elderly Aunt and Uncle under these circumstances

will bind the other children, especially minor children, that

make up the Estate. They testified in rebuttal only to

counter the Defendant’s contention that the deceased's in-

tention was to designate the son as beneficiary and alleged

comments by him verifying same prior to death. This evi-

dence was not even presented, as the Opinion would read,

in the Defendant’s case in chief. Perhaps the Aunt and

Uncle cannot receive their share of the income, but that

issue should be determined in Probate Court after a thor-

ough trial.

This Court has mistakenly cited an untenable basis for

erasing a potential $10 Million Judgment, without citing

any case law, precedent, statutory authority, etc. The lead-

ing treatise on Estates, Page on Wills, 2639, 2642, cites

Arkansas cases and states the following when dealing with

probate law and an Estate:

Notice must be served upon the persons who are spec-

ified in the statute which regulate notice. The con-

tents of the citation or notice must conform to the

requirements of the statute. Without express author-

ity, the entrance of appearance by one heir does not

22a

enter an appearance for another heir. Jd., pgs. 87,

88, and 92.

The Arkansas case of Sowell v. Housman, 207 Ark. 929,

183 S.W.2d 511 (1944) is cited as being in conformance

with the aforementioned, horn book rules of law. See also

Matter of Lacy’s Estate, 126 Cal. Rptr 432, 54 Cal.App.

3rd 172 (1975) and Hesthagen v. Harby, 78 Wash.2d 934,

481 P.2d 438 (1971). These cases are not exactly on point,

but the analogy is clear. The Estate is an entity that can

only be bound by notice, in the statutorily described man-

ner, to the Executor or Administrator.

Furthermore, the Defendant offered no proof on the age

of these minor children at all pertinent times, much less

whether they were incapacitated or incompetent for some

other reason. It had the burden of proof on the issue of

limitations; said burden does not shift to the Plaintiff be-

cause it is obvious from the record we are dealing with

minor children. Notice to a minor, by statute, must go

through a Guardian. See A.C.A. § 28-65-101, et seq.

Finally, Lewis Mathis, the attorney for the Friday Firm,

berated and ridiculed the balance sheets in question in his

testimony as bogus, and said that everyone knew the de-

ceased put what he thought his bankers wanted to see on

said documents.

In sum and substance, whether or not Rita Fields and

Jack Smith used due diligence is a question of fact, ju-

dicially recognized as such, for the jury. This Court’s fall

back position is simply untenable.

This Court’s Opinion is directly contrary to long estab-

lished rules of law pertaining to insurance companies and

their obligations to those they deal with. For that reason,

same must be gone into in this pleading.

23a

Ill

GENERAL RULES OF LAW

The law is clear, in every jurisdiction, that in every

contract, including a policy of insurance, there is an im-

plied covenant of good faith and fair dealing that neither

party will do anything which will injure the right of the

other party to receive the benefits of the agreement. Mer-

ritt v. J.A. Stafford Co., 440 P.2d 927 (1968); Couch on

Insurance 2d, § 15:25. Insurance policies are contracts of

the utmost good faith and must be administered and per-

formed as such by the insurer. A relationship of trust and

confidence between the insurer and insured, as distin-

guished from the existence of a formal trust, is recognized

by Courts and is used by Courts to prohibit the insurance

company from practicing fraud or a misrepresentation. Jd.

at § 23:12.

The law is equally clear, and recognized in all jurisdic-

tions, that where fraud is involved the time period within

which a beneficiary must sue commences to run only from

the date of the discovery of the fraud, or when “‘the fraud’’

might with reasonable diligence have been discovered, Jd.

at 75:107. If the person injured:

remains ignorant for a time, the applicable stat-

ute of limitations commences to run only from

discovery or the date when, with reasonable dil-

igence, there ought to have been a discovery of

the facts constituting the fraud... Id.

As a matter of simple contract law, the Defendant has

failed to discharge its contractual obligations. When the

insurer makes payment of the proceeds of insurance to

the rightful beneficiary, such payment is a discharge of

the liability of the insurer. Jd., 27:176. However,

the payment of the proceeds of insurance to the

wrong person by an insurer does not relieve it

of its liability to the proper beneficiary, whether

24a

the payment is improper because made to a sub-

stituted beneficiary where there was no legally

effective change of beneficiary, or because made

to the original beneficiary where there had been

an effective change of beneficiary. Jd. at § 27:177.

If the insurer knows of potential adverse claims to the

insurance proceeds, and chooses to pay any one of the

claimants, it acts under the risk that the recipient selected

by it is the one who is lawfully entitled thereto. Jd. at

§ 27:178. The rightful beneficiary can sue the wrongful

recipient, but this does not relieve the insurer of its lia-

bility to the correct beneficiary. Jd. at § 27:179. Appleman

on Insurance, 1098, echoes these principles and cites the

Arkansas Supreme Court case of Sovereign Camp. Wood-

men of the World v. Israel, 117 Ark. 121, 173 S.W.2d 855

(1915) in support of same.

If the insured does not know of the existence of the

insurance contract, or know that he is a named beneficiary

under same, he will not be barred by limitations for failing

to pursue a claim within the standard statutory time frame.

Couch on Insurance 2d. § 75:175. Thompson v. Equitable

Life Assurance Society, 298 A.2d 422 (1974).

The fact that fraud and fraudulent concealment will toll

the applicable statute of limitations on a beneficiary bring-

ing a cause of action on their life insurance policy is spelled

out in greater detail at § 75:210.

Fraud of an insured tolls the limitation on a right of

action whether statutory or contractual, and the lim-

itation becomes effective only from discovery or from

the date when, with reasonable diligence, there ought

to have been discovery. (emphasis added) citing Fire-

men’s Insurance Co. v. Jones, 245 Ark 179, 431

S.W.2d 728 (1968).

If by any act of concealment or deceit the wrongdoer

hides from the innocent party the facts which would

25a

put him upon inquiry, the contractual limitation or

statute does not begin to run.

Fraudulent concealment constitutes an implied excep-

tion to the statute of limitations, and a party who

wrongfully conceals material facts, and thereby pre-

vents a discovery of his wrong and the fact that a

cause of action has accrued against him, is not allowed

to take advantage of his own wrong by pleading the

statute, the purpose of which is to prevent wrong and

fraud.

Perhaps the Arkansas Supreme Court case of Metro-

politan Life Insurance Co. v. Williams, 197 Ark. 883, 125

S.W.2d 441 (1935) provides us with the best synopsis of

Arkansas law in regard to deciding the issues at hand.

The fact situation of Williams is extremely complicated

and convoluted, but suffice it to say that in September of

1923 an insured under a life insurance policy disappeared.

The Plaintiff and beneficiaries in Williams did not file her

lawsuit until September 28, 1931. The insurance company

pled limitations as a complete bar, and the Plaintiff alleged

fraud and fraudulent concealment against the insurance

company to defeat same. The Arkansas Supreme Court

stated;

It is a general rule that where one has deceived an-

other or where, through active wrong or NEGLI-

GENCE, misleads another and causes him not to file

suit, the statute is tolled or suspended until it is dis-

covered that the representations were false. If a

Defendant intentionally or NEGLIGENTLY misleads a

Plaintiff by his representations and causes him to de-

lay until the statutory bar has fallen, the Defendant

will be estopped from pleading the statute of limita-

tions. (emphasis added) Jd. at 448.

Cases too numerous to cite stand for the proposition

that an insurance policy is governed by contract law. The

“i r

26a

Court of Appeals in Rice v. McKinley, 267 Ark. 659, 590

S.W.2d 305 (1979) provides us with further insight on ex-

ceptions to a strict enforcement of a statute of limitations

to bar a Plaintiff,s Complaint. In Rice, a contract was

entered into between the parties in February of 1968. A

suit was filed by the Plaintiff on January 28, 1976, and

the Defendant raised the statute of limitations and laches

as a defense. The Court of Appeals held:

The error of Appellant’s position is that the period

of limitations runs from the point at which the cause

of action accrues rather from the date of the agree-

ment...

Where the parties have entered into an agreement

which requires a series of mutual acts, some unilat-

eral, some bilateral in character and have left the time

of those acts open ended, and where one contrives to

receive the benefits of the agreement .. .the cause of

action does not accrue until one party has by word

or conduct indicated to the other a repudiation of the

agreement... ..

If a right of action depends upon some contingency

or a condition precedent, the cause of action does not

accrue and the statute of limitations does not begin

to run until that contingency occurs or the condition

precent is complied with. Jd. at 307-308.

The recent case of Chadwell v. E.T. Pannell, 27 Ark

App. 590, 776 S.W.2d 38 (1989) echoes these principles

and cites Rice, supra, as pursuasive authority. The Court

in Chadwell furthermore stated that the statute of limi-

tations is not favored by the law. Under circumstances

similar to those that existed in Rice. the Court held that:

Under these circumstances, the date the limitations

began to run is a question of fact. Where a question

of fact remains to be solved, the granting of summary

27a |

judgment is inappropriate... Jd. at 41. (emphasis

added)

In Bowler v. Fidelity & Casualty Company of New York,

250 A.2d 580 (N.J. 1969), the Supreme Court of New

Jersey reversed a lower Court’s ruling that a Claimant’s

right to pursue insurance benefits was barred by the ap-

plicable statute of limitations. The insurance company had

failed to make payments due the insured under a policy

of insurance, and, through its silence. had induced the in-

sured not to file a lawsuit within the applicable statute of

limitations. The quoted pertinent parts of the Court,s de-

cision read as follows:

[An insurance company’s] position requires the as-

sumption of a stern obligation toward people who pur-

chase their contracts. Simply described the obligations

is that of fair dealing. . Insurance policies are con-

tracts of the utmost good faith and must be admin-

istered and performed as such by the insurer. Good

faith demands that the insurer deal with laymen as

laymen and not as experts in the subtleties of law

and underwriting ... There is an implied covenant of

good faith and fair dealing that the insurer will not

do anything to injure the right of its policy holder to

receive the benefits of its contract. This covenant goes

deeper than the mere surface of the writing. When

a loss occurs which because of its expertise the insurer

knows or should know is within the coverage, and the

dealings between the parties reasonably put the com-

pany on notice that the insured relies upon its integ-

rity, fairness and honesty of purpose, and expects his

right to payment to be considered, the obligation to

deal with him takes on the highest burden of good

faith. (cases cited)

In situations where ... the uninformed insured might

be inclined to be quiescent about the disregard of non-

payment of his claim and not to press it in timely

28a

fashion, the company cannot ignore its obligation. It

cannot hide behind the insured’s ignorance of the law;

it cannot conceal its liability. In these circumstances

it has the duty to speak and disclose, and to act in

accordance with its contractual undertaking. The

slightest evidence of deception or overreaching will bar

reliance upon time limitations for prosecution of the

claim. (emphasis added)

More specifically, in a situation such as that present

here, if all or part of the benefits provided by the

policy clearly 1s due, the insurer must make the pay-

ment. If it fails to do so. and the statute of limitations

or a policy limitation intervenes before suit is started,

it will be estopped to plead the limitation in avoidance

of a trial on the merits of the claim. Further, if the

insurer has factual information in its possession sub-

stantially supporting the policyholder’s right to ben-

efits, but it has a reasonable doubt as to whether the

evidence is sufficient to require payment, the obliga-

tron to exercise good faith, upon which it knows or

should know the insured is relying, cannot be satisfied

by silence or in action. It must notify the insured of

its decision not to pay his claim. But mere naked

rejection would not be sufficient. The giving of such

notice should be accompanied by a full and fair state-

ment of the reasons for its decision not to pay the

benefits, and by a clear statement that if the insured

wishes to enforce his claim it will be necessary for

him to obtain the services of an attorney and institute

a court action within the appropriate time. The ‘‘ap-

propriate time’’ means the time remaining under the

policy or the applicable statute of limitations within

which the suit must be brought. Failure on the insur-

er’s part to follow such a course. will bar reliance on

the statute of limitations or a time restriction on court

action expressed in the policy.

29a

Failure to make this payment constitutes conduct in-

compatible with the insurer,s obligation to exercise

good faith in dealing with its insured, and of ztself

creates an equitable estoppel against the plea of the

statute of limitations. (emphasis the Court’s) .

We regard the company,s cessation of payments and

its unexplained avoidance of its contractual obligation

as so inequitable and unconscionable as to bar reliance

upon the statutory limitation on the institution of suit

on the policy. Such conduct cannot be permitted to

support a technical defense which would avoid a de-

cision on the merits. enforce a forfeiture and bestow

on the carrier a shockingly unfair advantage. (cases

cited)

When claims are honestly made care should be taken

to prevent technical forfeitures such as would ensue

from an unreasonable enforcement of a rule of pro-

cedure unrelated to the merits. Under the circumstan-

ces it would be a perversion of the policy of the statute

of limitation to deny a trial on the merits.

There is no need to make fine distinctions as to the

persons who owe a duty to disclose. It is likewise un-

necessary to dwell upon the contention that the in-

surer’s duty of good faith to its insured arises at the

time of contracting and persists throughout the period

when premiums are paid and no return is sought, but

that when a loss occurs and the insured seeks to

obtain the compensation provided in the contract, the

parties deal at arm,s length. It is sufficient to hold

that the equitable considerations that justify relief in

this ¢ase are applicable whether defendant violated a

legal duty in failing to disclose its intention to set up

this technical defense, or whether it is now merely

seeking the aid of a court in sustaining a plea that

would enable it to obtain an unconscionable advantage

and enforce a forfeiture. (emphasis added)

30a

Although none of the cases cited immediately above

involved precisely the issue presented here, in our

view all of them point in the direction of the result

we consider just. It would be a reproach to the law

if there were no means of avoiding the unjust result

the company seeks to impose upon the insured. /d.

at 587-90.

Courts have gone to extraordinary lengths to prevent

a party from preventing the trial of a cause on the merits

by invoking the statute of limitations, when the party seek-

ing to invoke the defense had a superior means of ac-

quiring knowledge relative to the contract, and the

mechanics behind which said contract was to be enforced.

W.V. Pangborn v. N.J. Dot, 552 A.2d 222 (N.J. 1989).

The case of Davis v. Blue Cross of Northern California,

600 P.2d 1060 (1979) is discussed at length in Sarchett v.

Blue Shield of California, 729 P.2d 267 (1987) and provides

a useful precedent for the Court in the case at bar:

The insurer’s implied duty of good faith and fair deal-

ing includes a responsibility to inform its insureds of

their rights under the policies. . .Failure to inform its

insureds of the policies . .. provisions amounted to an

implied misrepresentation. (emphasis the Court’s)

Blue Cross ignores the special nature of the insurer-

insured relationship and the resultant duties which an

insurer owes to its insureds. (cases cited) Among those

duties, we stated, is the duty of each contracting party

to refrain from doing anything to injure the right of

the other to receive the benefits of the agreement.

Thus, [the insurer] ... must give at least as much

consideration to the [insured’s] interest as it does to

its own. One important facet of the insurer’s obli-

gation to give the insured’s interest as much consid-

eration .. .as it does. . .its own is the duty reasonably

to inform an insured of the insured’s rights and ob-

ligations under the insurance policy. In particular, in

3la

situations in which an insured’s lack of knowledge

may potentially result in a loss of benefits or a for-

feiture of rights, an insurer has been required to bring

to the insured’ attention relevant information so as to

enable the insured to take action to secure rights af-

forded by the policy.

The duty of good faith does not permit the insurer

passively to assume that its insured is aware of his

rights under the policy. The insurer must instead take

affirmative steps to make sure that the insured 1s in-

formed of his remedial rights. (emphasis added) Jd. at

276-77.

Arkansas recognizes the first party tort of bad faith,

Aetna Casualty & Surety Co. v. Broadway Arms, 281 Ark.

128, 664 S.W.2d 463 (1984). However, even jurisdictions

which do not hold that an insured has a cause of action

for bad faith recognize that there is an ‘‘implied covenant

of good faith” in every insurance contract that is ‘‘the

essence of what the insured has bargained and paid for,

and the insurer has the obligation to perform them. Beck

v. Farmers Insurance Exchange, 701 P.2d 795, 801 (Ut.

1985). Whether or not an insurance company has fulfilled

this duty and obligation is a question of fact for a jury.

Id.

The Supreme Court of the State of Tennessee has held

that an insurance company’s obligation under the contract

to deal ‘‘fairly and in good faith’ goes beyond only those

duties “‘specifically spelled out in the contract drawn by

the insurer.”” MFA Mutual Insurance Company v. Flint,

574.S.W.2d 718, 720 (Tn. 1978).

Federal Courts interpreting Arkansas law have held that

an insurance company must exercise “reasonable care’’

when determining whether to pay a claim, to whom, and

for what amount. Whether reasonable care was exercised

is always a question of fact for the jury. McChristian v.

32a

State Farm Mutual Automobile Ins. Co., 304 F. Supp. 748

(W.D. Ark. 1969)

Thus, as this Court can see, insurance companies do

have a duty to pay the proceeds to the proper party, and

to apprise any beneficiary of their potential rights, and

offer an explanation to said beneficiary when the insurance

company is unsure whether it owes an obligation or not

and faiis to pay said obligation. The case at bar is not the

first time the situation has arisen, and Courts have uni-

formly held that the insurance company cannot rely upon

a procedural defense to bar a trial on the merits, when

the potential Plaintiff failed to pursue a cause of action

within the applicable statute of limitations period because

of the insurance company’s silence.

Ill

ERRONEOUS STATEMENTS CONTAINED IN THE

SUPREME COURT’S OPINION

Finally, the following specifics are advanced in further

support of the Appellee’s view the record in these pro-

ceedings was not read carefully.

Supreme Court Opinion: Mr. Horn con-

cluded. . .that Steve Stoltz was the ‘legal’ bene-

ficiary and [concluded in an] executive meeting

with FPL approximately one week later. . .that

paying the son ‘without interpleader’ was ‘the

best course.’ (See Opinion pg. 3)

Facts: Mr. Horn told the insurance company to interplead

the money, that this was the safest course to take, that

this would alert the Estate to its potential claim, that the

Estate had a potential claim, and that interpleading the

money would expose the insurance company to a suit from

the loser. The “executive meeting” to which this Court

refers occurred the SAME DAY (not a week later) as the

Memo from Mr. Horn telling his client to interplead the

33a

money. The words “legal beneficiary’ and “the best

course’ are contained in Defendant’s Exh. 20, or the hand-

written Memorandum dated the same day and directly con-

tradictory to Mr. Horn’s Memo, from an individual in the

Claims Department of the Defendant. The fact that the

Memo from Mr. Horn, and this bogus Memo from the

insurance company are dated the same day, and also con-

tradictory, was adequately pressed at the trial of this mat-

ter and show the subtleties from which fraud may be

inferred. All third parties testified that had they known

that neither the Estate nor Steve Stoltz knew of the dis-

crepancies in the beneficiary, they would have notified him

of this because that was “the only honest thing to do.”

The Court’s Opinion: This dispute with the IRS

arose because of a [gift tax] provision, if a gift

is made within three (3) years of the decedent’s

death. (See Opinion pg. 3)

Facts: The IRS agent investigating this matter told the

Friday Firm that, although the money was paid to the

son, there was and is a valid issue regarding whether or

not the Estate is the proper beneficiary, and noted the

fact that the Estate,s attorneys, who were also represent-

ing the insurance company itself at that time, whited out

portions of the file and sent it to the IRS.

The Court’s Opinion: In 1983, the attorneys who rep-

resented both the Estate and Steve Stoltz requested

[the files and they were readily turned over.] ’In all

probability’ these files would have been turned over

to the Estate upon like inquiry. (See Court’s Opinion

pg. 8)

Facts: The attorneys representing the Estate got the files

in 1983, when they were also representing the Defendant

insurance company itself. Surely, it does not seem ironic

to this Court that the attorneys representing the insurance

company would have open access to its client’s own files,

and said attorneys would protect its client. In contrast,

34a

the attorneys representing the undersigned’s clients filed

discovery, and had to have a Court Order to compel the

Defendant and the Friday Firm to turn over the material

from the insurance company’s files to him. On top of spec-

ulating to supply facts to support its opinion if the true

interaction could not be ascertained, we have an example

in the record that shows this Court’s supposition is wrong.

The Court’s Opinion: In response, First Pyramid den-

ies concealment and asserts the Estate knew or should

have known of the change in beneficiaries on the pol-

icies. (See Court’s Opinion pg. 5)

Query: The undersigned cannot ascertain what this Court

means by this statement, as same, except for ‘‘denies con-

cealment,”” has no connection to any position raised by

either party on Appeal.

Finally, this Court cites Atlanta Exploration, Inc. v.

Ethyl Corporation, 301 Ark. 331, 784 S.W.2d 150 (1991)

as one of the few cases in its ruling to support its opinion

that you must have affirmative and fraudulent acts of

concealment. A reading of this case makes it clear that

this Court found that said finding is a question of fact for

the jury.

CONCLUSION

Writing this Brief is a sad day for the undersigned. It

is sad because he has to address this Honorable Court in

this manner. He has held this Court in the highest esteem,

and took an oath before this Court that he takes very

seriously. The first thing some people do when they lose

is manufacture excuses and shout ‘“‘sour grapes.” Such is

not the case here. The undersigned is not a radical or a

renegade. He wakes up each morning with both feet on

the ground, and has lost cases before he thought he should

have won when there were legitimate issues present. Such

is not the case here either.

35a

The Appellee won this case before the jury. Every ‘“‘issue

of fact” this Court chooses to change or ignore was pre-

sented to the jury. The jury was properly instructed, or,

in the alternative, no objections were raised which merit

any discussion in this Petition and Brief. The undersigned

beat the Appellant at every turn; here buffed every ar-

gument, legitimately, factually, and according to the law.

There is substantial evidence to support fraud. It was

made a jury question by the Defendant. It is the law of

the case. This Court cannot read the Abstract of the Tes-

timony provided as Exh. A to the Brief in Support of

Motion For Vacatur, To Disqualify And, In The Alter-

native, To Appoint A Special Master, And Motion For

Extension Of Time To File Petition For Rehearing, and

state otherwise.

According to this Court’s decision, an insurance com-

pany within this State can pay whomever it chooses, or

pay no one at all, take no affirmative action whatsoever

to alert the rightful beneficiary, wait five years, and be

home free. We must all check the obituaries for the pre-

ceding five years, and stay ‘‘up to date” on deaths from

this day forward, in order to make sure we send inquiries

to all insurance companies who have paid benefits asking

if those benefits really belonged to us. Is that what this

Court wants to tell the People of Arkansas? The Appellee,

and those he stands for, feel like the families of the victims

wronged by the individuals recently set free by acting

Governor Jerry Jewell, who acted in spite of the decisions

of those respective juries.

The Appellee is asking this Court to have the courage

to admit they made a mistake and right the wrong. We

have lived by the jury system in this country for years,

and this Court’s verdict simply states that the decisions

of a jury within this State carry no weight whatsoever.

In sum and substance, while the Appellee could see how

an adversary, who carries the torch for his client, could

36a

argue in good faith that a factual question for the jury is

present on the issues pertinent to these proceedings, there

is absolutely no way anyone can read the record, view

same in the light most favorable to the Appellee, and state

the evidence at trial is so one-sided the jury,s verdict, and

concurrent findings of fact, can be overturned.

Respectfully submitted,

DAVIDSON LAW FIRM, LTD.

P.O. Box 1300

Little Rock, Arkansas 72203-1300

(501) 374-9977

By: s/s Charles Phillip Boyd, Jr.

Charles Phillip Boyd, Jr.

Bar No. 82023

CERTIFICATE OF SERVICE

I, Charles Phillip Boyd, Jr., do hereby certify that the

above and foregoing has been mailed by ordinary mail with

sufficient postage affixed thereon, on this the 22nd day

of January, 1993, to:

Peter G. Kumpe

Williams & Anderson

400 Rogers Building

111 Center Street

Little Rock, AR 72201

s/s Charles Phillip Boyd, Jr.

Charles Phillip Boyd, Jr.

37a

APPENDIX 4

SUPREME COURT OF ARKANSAS

No. 92-4

FIRST PYRAMID LIFE INSURANCE COMPANY OF AMER-

ICA,

APPELLANT

J. MICHAEL STOLTZ, AS SPECIAL ADMINISTRATOR OF

THE ESTATE OF J.P. STOLTZ, DECEASED,

APPELLEE

Opinion Delivered FEB 15 1993

APPEAL FROM THE PULASKI COUNTY CIRCUIT

COURT, NO. 89-2464.

HON. CHRIS PIAZZA, JUDGE

CONCURRING OPINION.

JACK HOLT, JR., Chief Justice

The appellee, Estate of J.P. Stoltz (hereafter “the Es-

tate’’), has filed a petition for rehearing requesting that

this court vacate its decision of December 21, 1992, re-

versing a jury verdict in the Estate’s favor. In addition,

the appellee has filed a separate motion for ‘“vacatur”

- praying that all members of this court who participated

in this case disqualify themselves from rendering any fur-

ther decision on the merits of this case and that seven

special justices be appointed. The court treated this motion

as a Letter of Suggestion of Disqualification, Ark. Sup.

Ct. R. 27, since our rules do not provide for a motion for

vacatur.

38a

The Estate’s Motion for Vacatur is premised upon al-

legations that I have a social relationship with Mr. Her-

schel Friday of the Law Firm of Friday, Eldredge & Clark

that renders my decision making in this case impaired

because of this relationship, that all members of this court

should disqualify.The determinative issue in this case is

whether the appellee, Estate of J.P. Stoltz, has proven

fraudulent concealment on the part of First Pyramid Life

Insurance Company in order to toll the statute of limi-

tations on the Estate’s claim. In an unanimous decision,

the other justices were in agreement that the Estate had

not proven fraudulent concealment and that the Estate

was not entitled to a judgment in its favor. Neither Mr.

Friday nor members of the Friday, Eldredge and Clark

firm were parties or counsel to the litigation in question,

nor served as attorneys at trial or during this appeal.

No one outside of this court has discussed this case with

me during its pendency on appeal. My relationship with

Mr. Friday is of no moment. It does not impair my decision

making processes in this case. For these reasons, I decline

the appellee’s suggestion that I disqualify.

39a

APPENDIX 5

IN THE ARKANSAS SUPREME COURT

NO. 92-4

FIRST PYRAMID LIFE INSURANCE COMPANY OF AMER-

ICA; USABLE INSURANCE COMPANY

APPELLANTS

VS.

J. MICHAEL STOLTZ, As Special Administrator of the Es-

tate of J.P. Stoltz, Deceased

APPELLEE

MOTION FOR RECONSIDERATION

Comes J. Michael Stoltz, As Special Administrator of

the Estate of J.P. Stoltz, Deceased, and for his Motion

does state as follows:

1. This Court rendered an Opinion on February 15, 1993

denying the Estate’s Motion for Vacatur, To Disqualify

And, In The Alternative, To Appoint A Special Master.

If the Court refused to disqualify itself, the Estate re-

quested the appointment of a Special Master to investigate

the extent of what is believed to be a close personal friend-

ship between Chief Justice Jack Holt, Jr. and Herschel

Friday of the Friday Law Firm, exemplified by Judge Holt

being the personal and specific guest of Mr. Friday’s on

numerous occasions through the years at social outings

and functions, including the period of time this matter was

pending on Appeal.

2. The Court’s Opinion erroneously states that the fact

that Judge Holt and Mr. Friday have a “social relation-

ship” is the only basis for his disqualification, and the

disqualification of the other members of this Court. The

40a

basis for the Motion to Disqualify is not simply that a

“social relationship’”’ exists between Mr. Friday and Judge

Holt. It is believed that Judge Holt is a regular guest of

Mr. Friday’s on his farm, which is in essence a private

hunting resort, in Mayflower, Arkansas, and that other

hunting excursions between these individuals transpired

while this matter was on Appeal. The Friday Law Firm

had a substantial interest in this Court’s overturning the

jury verdict that had been rendered in these proceedings.

By analogy and example, Judge Holt being a regular guest

of Mr. Friday on his farm, where pen raised quail are

hunted, complete with a hunting lodge that is said to be

elaborate and eloquent, is no different than Judge Holt

being a routine and regular guest of Mr. Friday’s at a ski

resort owned by Mr. Friday in Boulder, Colorado, and then

Judge Holt writing an Opinion that the Friday Law Firm

believes helps exonerate it from further exposure to the

Estate in future litigation that is imminent.

3. The Supreme Court’s Concurring Opinion does not

discuss, much less distinguish, Johnson v. Sturdivant, 295

Ark. 622, S.W.2d 415 (1988), nor tell the attorneys and

people of the State of Arkansas why the standards laid

down by that case applied to Judge John Purtle, but not

to Judge Holt.

4. This Court’s “Concurring Opinion” states as a basis

for the refusal to disqualify that “neither Mr. Friday nor

members of the Friday, Eldredge & Clark firm are parties

or counsel to the litigation in question, nor served as

~-attorneys at trial or during this Appeal.’’ Said statement

ignores, and is directly contrary to, the specific law laid

down by the U.S. Supreme Court which states in une-

quivocable fashion that recusal due to a conflict is not

limited to the parties named in the suit, or the attorneys

representing said parties. Lilejeberg v. Health Services Ac-

quisition Corporation, 486 U.S. 847, 108 S.Ct. 2194, 100

L.Ed.2d 855 (1988) and Preston v. U.S., 923 F.2d 731 (9th

Cir. 1991).

4la

4. The “Concurring Opinion’”’ states that the crux of the

issue on Appeal is whether or not fraudulent concealment

tolling the statute of limitations had been proven by the

Estate is the dispositive issue. This statement indicates to

the Estate that this Court has again refused to look at

the true issues inherent in this Appeal, or matters raised

in the post-Opinion pleadings unequivocably indicating that

the “law of this case,” as codified in Jury Instruction No.

8 (R.4877-78), given without objection, is that First Pyr-

amid is guilty of fraud which tolled the statute of limi-

tations because the Estate was determined to be the proper

beneficiary of the life insurance policies and First Pyramid

failed to apprise the Estate of its claim. While the entire

record, if reviewed, would indicate that numerous other

facts and factors representing fraud are present, no such

inquiry is necessary.

5. Judge Holt’s statement that no one outside the Court

has specifically discussed this matter with him during its

pendency on Appeal ignores the legal standard required

for recusal. There need be no allegations, or proof, that

this case was actually and specifically discussed by other

members, specifically Mr. Friday, with Judge Holt. The

fact that not only do they have a close personal friendship,

but that Judge Holt is a guest at Mr. Friday’s private

hunting resort, and on hunting excursions outside the State

of Arkansas, and will undoubtedly continue to be a guest

on a regular but intermittent basis in the future, is enough

to cause a reasonable man to question Judge Holt’s im-

partiality. That is the standard, not whether or not specific

discussions of this case took place. 415 (1988) dictates that

the remaining members of this Court disqualify, and that

seven (7) special Justices be appointed to hear this matter

on its merits.

6. The failure of this Court to appoint a Special Master

to investigate the full extent of the personal friendship

between Judge Holt and Mr. Friday, and the number of

times Judge Holt has been the personal quest of Mr. Fri-

42a

day’s on his private land, or on out of state leases, to

partake in an important recreational activity, amounts to

Judge Holt sitting in judgment on himself with no denial

that such is the true situation, much less an explanation

for why same is not grounds for disqualification. This sit-

uation inherently raises the issue which mandated the en-

tire Court’s recusal, and articulated in Johnson v.

Sturdivant, 295 Ark. 622, 758 S.W.2d 415, 416 (1988) as

follows: ‘It is not easy to sit in Judgment of one’s self.”

These events amount to a violation of the 14th Amendment

to the United States Constitution, a denial of due process

for the Estate, and causes one to seriously question the

Estate’s ability to receive a fair hearing in these pro-

ceedings.

7. Attached hereto as Exh. A is an Affidavit in ac-

cordance with Rule 3 of the Rules of the Supreme Court.

WHEREFORE, the Estate respectfully prays that this

Court reconsider its “Concurring Opinion,” and its refusal

to disqualify itself, that this Court not render any addi-

tional Opinions pending the outcome of a judicial inquiry

by the Arkansas Judicial Discipline & Disability Commis-

sion, and for all other relief to which it is justifiably en-

titled. i

Respectfully submi

DAVIDSON LAW

P.O. Box 1300

Little Rock, Arkansas 72203-1300

Telephone (501) 374-9977

By: s/s Charles Phillip Boyd, Jr.

Charles Phillip Boyd, Jr.

Bar No. 82023

[, LTD.

CERTIFICATE OF SERVICE

I, Charles Phillip Boyd, Jr., do hereby certify that the

above and foregoing has been mailed by ordinary mail with

43a

sufficient postage affixed thereon, on this the 18th day of

February, 1993, to:

Peter G. Kumpe

Williams & Anderson

400 Rogers Building

111 Center Street

Little Rock, AR 72201

s/s Charles Phillip Boyd, Jr.

Charles Phillip Boyd, Jr.

44a

APPENDIX 6

AFFIDAVIT

Comes the undersigned and does hereby solemnly state

under oath the following facts and information are true

and correct to the best of my knowledge and belief:

1. I am one of the attorneys of record for the Appellee

in these proceedings.

2. I represent six (6) heirs and/or beneficiaries of the

Estate of James Patrick Stoltz. My contact client, Mike

Stoltz, contacted me around Christmas, 1992, after this

opinion was delivered, and informed me that he had heard

of quail hunting trips taken to Herschel Friday’s farm by

Jack Holt, Jr., Chief Justice of the Arkansas Supreme

Court, and trips to leased land in the State of Texas. These

trips supposedly occurred intermittently, but on a repeti-

tive basis, through the years.

3. The last paragraph of the letter form Mike Stoltz

requested, in no uncertain terms, that I “‘investigate these

rumors immediately and see if there is any validity to them

notify [him] of [his] legal options.

4. I have investigated this matter by various means,

including, but not limited to, a direct conversation with

Mr. Herschel Friday, and have been apprised that Chief

Justice Jack Holt, Jr. and Herschel Friday have “‘kept up

with each other through the years,” and have hunted to-

gether in Texas on leased lands, and on Herschel Friday’s

farm in Mayflower, Arkansas. I have furthermore been

apprised that the Honorable Chief Justice Jack Holt, Jr.

has hunted in Mayflower with Mr. Friday’s son. These

quail hunting excursions have been intermittent, but re-

petitive, through the years and include at least one oc-

casion during the ‘‘quail’’ season of 1992-93.

5. I have been apprised through my dealings with mem-

bers of the Friday Law Firm that they believe, although

45a

I disagree with same, that the Opinion in this Court helps

insulate them from any further exposure in these pro-

ceedings based on the statute of limitations. I make no

assertions, or insinuations, that the decision of this Court

and the opinion of the Friday Firm in this regard are

anything other than circumstantial; I am merely stating

under oath what has been related to me to show the Friday

Firm has made statements that it believes it is an inter-

ested party.

6. I have counseled with other attorneys whom I hold

in the highest esteem, and have been told that, based on

my client’s letter alone, I have no choice but to bring this

matter to this Court’s attention.

s/s Charles Phillip Boyd, Jr.

CHARLES PHILLIP BOYD, JR.

VERIFICATION

I, Charles Phillip Boyd, Jr., the undersigned, do hereby

state under oath that the statements set forth hereinabove

are true and correct to the best of my information, knowl-

edge and belief.

s/s Charles Phillip Boyd, Jr.

CHARLES PHILLIP BOYD, JR.

SUBSCRIBED AND SWORN TO before me a Notary Pub-

lic, on this the 19th day of January 1993.

s/s Edwina K. Bell

NOTARY PUBLIC

My Commission Expires:

12-1-95

46a

APPENDIX 7

Party

Repre-

sented

Case Firm Outcome Firm

Rich Mountain Elec. Coop. v.

Revels, 311 Ark. 1, 841 S.W.2d

151 (1992) Appellant Affd -

Union National Bank v.

Barnhart, 308 Ark. 190, 823

S.W.2d 878 (1992) Appellant Affd -

Ross v. Patterson, 307 Ark. Rev’d/ +

68, 817 S.W.2d 418 (1991) Appellant Dism’d

Travis v. Houk, 307 Ark. Rev'd) -

84, 817 S.W.2d 207 (1991) Appellee Rem

Club, Inc., 306 Ark. 491, Rev’d/

811 S.W.2d 315 (1991) Appellee Rem -

Blankenship v. Burnett, 304

Ark. 469, 803 S.W.2d 539

(1991) Appellee Aff d +

Barnett v. Arkansas Transport

Co., 303 Ark. 491, 798 S.W.2d

79 (1990) Appellee Aff d +

Allstate Ins. Co. v. Redman

Homes, Inc., 302 Ark. 335, Rev’d/

789 S.W.2d 454 (1990) Appellee Rem -

CDI Contractors, Inc. v. Goff

Steel Erectors, Inc., 301 Ark.

311, 783 S.W.2d 846 (1990) Appellant Affd -

McCollough v. Lessenberry, 300

Ark. 426, 780 S.W.2d 9 Rev’d/

(1989) Appellant Rem .

47a

Moore v. Missourn Pacific R.R.,

299 Ark. 232, 773

S.W.2d 78 (1989)

Ragland v. General Tire &

Rubber Co., 297 Ark. 394,

763 S.W.2d 70 (1989)

Carton v. Missourt Pac.

R.R., 295 Ark. 126, 747

S.W.2d 93 (1988) (reh’g

denied, April 25, 1988)

Gipson v. Brown, 295 Ark.

371, 749 S.W.2d 297 (1988)

Butler Mfg. Co. v. Hughes, 292

Ark. 198, 729 S.W.2d 142

(1987), supplemental opinion

reh’g denied, 292 Ark. 206-A,

731 S.W.2d 214 (1987)

Howard v. Wood Mfg. Co.,

291 Ark 1, 722 S.W.2d 265

(1987)

First State Bank v. Twin

City Bank, 290 Ark. 399,

720 S.W.2d 295 (1986)

Gipson v. Brown, 288 Ark. 422,

706 S.W.2d 369 (1986)

Appellee

Appellant

Appellee

Appellant

Rev’d/

Rem

Rev’d/

Rem

Rev’d/

Rem

Case

Dism’d

Aff'd

Appeal ~

’ Dism’d

Rev’d/

Rem

This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.