528 [300 FIRST NATIONAL BANK of DeWitt v Claude CRUTHIS, Catherine Cruthis, Bill Cruthis, Terry Cruthis, Cruthis Brothers, Riceland Seed Company and Stratton Seed 04-448 203 S W3d 88 Supreme Court of Arkansas Opinion delivered February 10, 2005 [Rehearing denied March 10, 2005 CONSTITUTIONAL LAW — INTERPRETING STATE'S CONSTITUTION — SUPREME COURT'S TASK — In interpreting the constitution on appeal, the supreme court's task is to read the law as it is written and interpret it in accordance with estabhshed principles of constitutional construction, it is the supreme court's responsibility to decide what a constitutional provision means, and it will review a lower court's construction de novo, the supreme court is not bound by the decision of the circuit court, however, in the absence of a showing that the circuit court erred in its interpretation of the law, that interpretation will be accepted as correct on appeal 2 CONSTITUTIONAL LAW — CONSTRUCTION — STANDARD USED — Language of a constitutional provision that is plain and unambiguous must be given its obvious and common meaning, neither rules ot construction nor rules of interpretation may be used to defeat the clear and certain meaning of a constitutional provision CoNsTi u RoNAL LAW — AmENDMENT 80 MERGED CHANCERY & CIRCUIT COURTS — CONSEQUENCES OF AMENDMENT — Amendment 80 to the Arkansas Constitution merged the chancery and circuit courts, as a consequence of Amendment 80, courts that were formerly chancery and circuit courts are now referred to as circuit courts, because Amendment 80 states that circuit courts assume the junsdiction of chancery courts, circuit courts simply have added to their already existing jurisdiction as a court of law the equitable jurisdiction that chancery courts held pnor to adoption of the Amendment; in other words, no new or expanded jurisdiction beyond that formerly existing in the chancery and circuit courts was created through Amendment 80, rather, circuit court jurisdiction now includes all matters previously cognizable by circuit, chancery, probate, and juvenile courts
FIRST NATir BANK V CRUTHIS ARK ] Cite a5 360 Ark 528 (2005) 529 COURTS — ELECTION OF COURTS NO LONGER NECESSARY — JURISDICTION OF LAW & EQUITY NOT ALTERED BY AMENDMENT 80 — There is no longer a need to elect in which court to file a lawsuit, however, Amendment 80 did not alter the j urisdiction of law and equity, it only consolidated junsdiction in the circuit courts, therefore, matters that could be submitted to a jury for decision and matters that must be decided by the court remain unaltered CONSTITUTIONAL LAW — GUARANTEE TO TRIAL BY JURY — UNAFFECTED BY AMENDMENT 80 — The right to a jury tnal set out in the Arkansas Constitution in Art 2, Sec 7 was unaffected by Amendment 80, all five Arkansas Constitutions have provided that the right to a jury trial "shall remain inviolate' '; the 1868 and 1874 constitutions include the additional language that the right to a jury trial extends to "all cases at law"; the supreme court has clearly stated that Art 2, Sec 7 does not assure the right to a jury trial in all possible instances, but rather in those cases where the right to a jury trial existed ' 'when our constitution was framed", further, the right to a jury tnal "does not apply to new rights created b y the legislature since the adoption of the constitution'', a constitution is not the beginning of government, and it is adopted with a knowledge that it is, and was made in harmony and consonance with the condition of the things existing at the time of its adoption: EQUITY — RESTITUTION FOUNDED ON DOCTRINE OF UNJUST ENRICHMENT — UNJUST ENRICHMENT BASED ON WRONGFUL RETENTION OF MONEY CORRESPONDS WITH COMMON LAW ACTION OF ASSUMPSIT — Restitution is founded upon the doctrine of unjust enrichment, which is an equitable doctnne; however, even though the doctrine is equitable, the issue of unjust enrichment has been submitted to the jury in circuit court where the assertion is wrongful retention of money because the cause of action is one corresponding with the common law action of assumpsit for money had and received the action for assumpsit is one for recover y of damages for nonperformance of a simple contract; such a contract may be express or implied, and the action is based on the breach thereof, and is therefore ex contractu; in both the civil and common law, rights and causes of action are divided into two classes — those arising ex contractu (from a contract), and those ansing ex delicto (from a delict or tort)
NAUL BANK I' Lii_u tins 530 Cite as 360 Ark: 528 (2005) [360 EQUITY — ASSUMPSIT — WHEN IT WILL LIE — Assumpsit is an action of an equitable character, liberal in form, and greatly favored by the court as a remedy; no agreement is necessary; assumpsit will he wherever the circumstances are such that the law, ex debito Justalae will imply a promise COURTS — ACTION AT LAW — LHANCERY COURT mAY RETMN JURISDRTIoN TO Du Lump LETE juSTICE AS BETWEEN PARTIES — While an action of assumpsit, although based on equitable pnnciples is an action at law, the law is well settled that when the chancery court has junsdiction of a case for one purpose, it will retain jurisdiction to settle the nghts of the parties ansing out of the subject matter, COURTS — UNJUST ENRICHMENT — MORE FREOUENTLY APPLIED IN COURTS OF CHANCERY — The pnnciple of unjust ennchment more frequently applied in courts of chancery, but is also recognized in courts of law 10, COURTS — RESTITUTION NOT ONLY EQUITABLE REMEDY SOUGHT — CASE REVERSED & REMANDED — Although unjust ennchment an equitable cause of action, because it is based on the alleged breach of an implied contract, it may be heard in circuit court and may be heard by a jury; however, the case here was reversed because restitution was not the only equitable remedy sought; appellant also sought an equitable hen on certain property, which is a nght to have a demand satisfied from a particular fund or specific property, an equitable hen has also been defined as a remedy that awards a nonpossessorv interest in property to a party who has been prevented by fraud, accident, or mistake from securing that to which he was equitably entitled, an action on an equitable hen was histoncally heard in chancery court because it is an equitable remedy; thus, the case was reversed & remanded Appeal from Arkansas Circuit Court; Charles A: Yeargan, Judge, reversed and remanded: Berry Law Firm, by, Russell D. Berry, Bradley A: Chambless, and AL Elizabeth Skinnet, for appellant: Malcolm R Smith, RA., for appellees: IM HANNAH, Chief Justice The First National Bank of J DeWitt (FNB) appeals a judgment on a jury verdict and
FIRST NAT'L BANK V: CRUTHIS ARK Cite as 360 Ark 528 (2005) 531 alleges that the circuit court erred in submitting an equitable issue for decision by the jury, in denying motions for judgment notwithstanding the verdict and new trial, and in failing to modify the jury verdict to conform to the jury's intent: We hold that the circuit court erred in submitting to the jury the equitable issues contained in Count I of FNB's Amended Complaint: Our jurisdiction is pursuant to Ark. Sup. Ct. R. 1-2(a)(1) and (b)(1): Facts This case involves money lent by FNB to Claude Cruthis, Catherine Cruthis, Bill Cruthis, Terry Cruthis, individually, and as partners of Cruthis Brothers, a partnership (Cruthis). The loans were used to fund farming operations. FNB lent Cruthis a total of $148,500 through six loans extended between 1993 and 19% The loans were variously secured by personal and real property In 19%, when Cruthis's wheat and oat crop were planted and growing, Cruthis told the FNB that due to a lack of funds, operations would cease. Cruthis sold some but not all propert y in which FNB held a security interest and forwarded the proceeds to FNB: This did not satisfy the total loan obligation, FNB decided to protect its exposure on the outstanding loans by finishing Cruthis's wheat and oat crops, which required an investment of more than $14,000. Wheat prices were rising during this time, and Cruthis approached FNB and asked that a portion of the future crop be committed to Bunge Corporation to obtain the higher price then available. FNB obligated itself to Bunge to acquire a higher price than might exist when the crop was actually harvested However, Cruthis had previously obligated some portion of the crop to Riceland Seed Company d,b, a, Stratton Seed Company (Stratton): Cruthis alleges that only a small portion of the crop was promised to Stratton, and that there was more than sufficient grain to meet both the obligation to Stratton, as well as make an offer to Bunge: When it came time to harvest, Cruthis stopped FNB from harvesting the grain and delivering it to Bunge, threatened prosecution for criminal trespass, rented equipment, harvested the grain, and delivered it to Stratton: Stratton sold the grain and received funds in the amount of $50,618; Stratton issued checks for the $50,18 and delivered the checks to FNB, however, the checks were not cashed, were never negotiated and Stratton retains the $50,618 today In 1998, Cruthis brought an action in Monroe County against FNB in conversion, interference with contract, and breach of fiduciary dut y : The Monroe Count y case resulted in a dismissal of Cnithit's comphmt because it shnnld have been brought- as a
FIRST NAT'L BANK V. CRUTHIS 532 Cite as 360 Ark 528 (2005) [360 compulsory counterclaim in the case before us, an already existing action filed in chancery court in Arkansas County on May 30, 1997: See First National Bank of Dewitt v: Cnithis, 352 Ark. 292, 100 S_W 3d 703 (2003) In the present action, by way of its Amended Complaint filed August 8, 2003, FNB sought restitution including an equitable lien, damages for breach of contract, damages for conversion, and damages for breach of warranty After dismissal of the action in the appeal noted above, Cruthis filed a counterclaim in the present action asserting causes of action for conversion, fraud and misrepresentation, tortious interference with contract, undue control and breach of fiduciary capacity: A jury demand was included in the counterclaim: Cruthis filed a motion to dismiss FNB's action in chancery for failure to assert that there was no adequate remedy at law. By the time the court heard the matter, Amendment 80 had taken effect, and the chancery court had become a circuit court The circuit court stated that there was merit to the claim that FNB failed to assert a lack of an adequate remedy at law and concluded that there was an adequate remedy at law. Hu w v er, rather than dismiss the case, the circuit court stated that the case would be decided at law rather than at equity. Following a jury verdict, FNB filed a motion for judgment not withstanding the verdict, or in the alternative, for a new trial: FNB alleged that there was a lack of substantial evidence supporting the jury verdict. More specifically, FNB argued that there was a lack of substantial evidence supporting the jury's verdict that Stratton was not unjustly enriched: Alternatively, FNB argued for a new trial based on an error in the jury's assessment "due to an erroneous conclusion as to the effect of their verdict form:" Amendment 80 [1, 2] This case involves a question of whether the circuit court erred in trying the case as one at law rather than at equity: This implicates Amendment 80 to the Arkansas Constitution and its effect on jurisdiction formerly residing in circuit and chancery courts: Amendment 80 is now part of our constitution, In interpreting the constitution on appeal, our task is to read the law as it is written and interpret it in accordance with established principles of constitutional construction: Smith v: Sidney Moncrief Pontiac, Buick, GMC, Co, , 353 Ark: 701, 120 S.W.3d 525 (2003); Brewer y, Fergus, 348 Ark: 577, 79 S.W.3d 831 (2002). It is this court's responsibility to decide what a constitutional provision means, and
FIRST NAT'L BANK V: CRUTHIS ARK ] Cite as 160 Ark 528 (200) 533 we will review a lower court's construction de novo, Id. We are not bound by the decision of the circuit court; however, in the absence of a showing that the circuit court erred in its interpretation of the law, that interpretation will be accepted as correct on appeal. Id. Language of a constitutional provision that is plain and unambiguous must be given its obvious and common meaning: Smith, supra; Worth v. City of Rogers, 341 Ark: 12, 14 S.W.3d 471 (2000); Daniel v. Jones, 332 Ark: 489, 966 S:W:2d 226 (1998): Neither rules of construction nor rules of interpretation may be used to defeat the clear and certain meaning of a constitutional provision: Id. [3] As we previously stated: The passage of Amendment 80 on November 7, 2000 was a watershed event in the history of the Judicial Department of this state: Jurisdictional lines that previously forced cases to be divided artificially and litigated separately in different courts have been eliminated: This fundamental change naturally bnngs with it a whole host of issues, both theoretical and practical, concerning tbe form and structure of our court system In Re Impkm of Amend. 80, 345 Ark, Appx: 664, 47 S:W.3d 262 (2001): Amendment 80 to the Arkansas Constitution merged the chancery and circuit courts: Summit Mall Co, V. Lemond, 355 Ark: 190, 211, 132 S:W,3d 725 (2003); United Food & Corn. Workers, Int. Union V. Wal-Mart, 353 Ark. 902, 120 S:W:3d 89 (2003): Section 6(A) of Amendment 80 to the Arkansas Constitution provides "Circuit Courts are established Is the trial courts of original jurisdiction of all justiciable matters not otherwise assigned pursuant to this Constitution:" As a consequence of Amendment 80, courts that were formerly chancery and circuit courts are now referred to as circuit courts: Id. Because Amendment 80 states that circuit courts assume the junsdicnon of chancery courts, circuit courts simply have added to their already existing jurisdiction as a court of law the equitable junsdiction which chancery courts held prior to adoption of the Amendment. Ark: Prop Bail Bondsman Licensinq Bd. 0: Frawley, 350 Ark: 444, 453, 88 S,W.3d 418 (2002): In other words, no new or expanded jurisdiction beyond that formerly existing in the chancery and circuit courts was created through Amendment 80: Rather, circuit court junsdiction now includes all matters previously cognizable by circuit, chancery, probate, and juvenile court. See Amendment 80, 19(B)(1), Administrative Order No: 14, q5 1(a) and (b), 344 Ark: Appx. 747- 48 (2001): See also Moore v Sipes, 85 Ark App 15, 106 S W 3d 903 (2004)
Ii 111.±.1 NA I 'L BANK V OW 534 Cite aL 360 Ark 528 (2005) [360 Prior to adoption of Amendment 80, a choice had to be made by a plaintiff of whether it was best to file suit in chancery or circuit court: The clean-up doctrine was used to allow a chancery court to decide law issues because under that longstanding rule, once a chancery court acquired jurisdiction for one purpose, it could decide all other issues: Douthitt Douthitt, 326 Ark. 372, 930 S,W,2d 371 (1996): The doctrine reached the point in recent years that unless the chancery court had no tenable nexus to the claim, this court would consider the matter of whether the claim should have been heard in chancery to be one of propnety rather then one of subject-matter jurisdiction. Douhitt, supra; Liles v Liles, 289 Ark 159, 711 S.W.2d 447 (1986). Further, it was possible to sever claims at law to be tried in circuit court_ Tyson v. Roberts, 287 Ark_ 409, 700 S.W.2d 50 (1985); see also Spitzer v: Barnhill, 237 Ark: 525, 374 S.W:2d 811 (1964): [4] There is no longer a need to elect in which court to file a lawsuit: See Clark v. Farmers Exchange, Inc., 347 Ark: 81, 89, 61 S.W.3d 140 (2001): However, as already discussed, Amendment 80 did not alter the jurisdiction of law and equity: It only consolidated jurisdiction in the circuit courts: Therefore, matters that could be submitted to a jury for decision and the matters that must be decided by the court remain unaltered: [5] The circuit court submitted this case to the jury, although FNB sought restitution and an equitable lien in Count I. FNB did not request a jury and argues on appeal that submission of restitution to the jury was error: Cruthis requested a jury in their counterclaim: Cruthis argues that it was not error to submit the case to the jury: The right to a jury trial sec OM in the Arkansas Constitution in Art: 2, Sec: 7 was unaffected by Amendment 80. All five Arkansas Constitutions have provided that the right to a jury trial "shall remain inviolate. - The 1868 and 1874 constitutions include the additional language that the right to a jury trial extends to "all cases at law. - This court has clearly stated that Art 2, Sec: 7 does not assure the right to a jury trial in all possible instances; but rather in those cases where the right to a jury trial existed "when our constitution was framed " Jones v, Reed, 267 Ark. 237, 248, 590 S.W 2d 171 ( 1 979) See also McClanahan v Gibson, 296 Ark_ 304, 756 S W 2d 889 (1988), Dunn v Davis, 291 Ark 492, 725 S.W 2d 853 (1987); Colelasure v. Kansas City Life Ins Co 290 Ark 585, 720 S W.2d 916 (1986), St Louis I M S Ry Co v. Hays, 128 Ark, 471, 195 S W. 28 (1917); Wheat v Smith, 50 Ark,
FIRST NAT'L BANK V. CRUTHIS ARV_ rite as 360 Ark 528 (2005) 535 266, 7 S:W: 161 (1888), Neel v. State, 9 Ark. 259 (1845). Further, the right to a jury trial "does not apply to new rights created by the legislature since the adoption of the constitution: - Henry v. Good-man, 294 Ark, 25, 741 S:W.2d 233 (1987) (rev 'd on other grounds by Act 293 of 1989): See also Lockley v, Easley, 302 Ark: 13, 786 S:W.2d 573 (1990)_ As this court stated in State v:Johnson, 26 Ark, 281, 289 (1870), "It has truly been said that a 'Constitution is not the beginning of government,' and that it is adopted with a knowledge that it is, and was made in harmony and consonance with the condition of the things existing at the time of its adoption." Because Amendment 80 left the right to a jury trial unaltered, the question presented is whether prior to adoption of Amendment 80, Count I could be properly submitted to a jury for decision. FNB argues that because restitution was sought in Count I, it was an equitable action that had to be tried to the court_ [6-9] Restitution is founded upon the doctrine of unjust enrichment Coley v Green, 232 Ark 289, 335 S,W,2d 720 (1960): Unjust enrichment is an equitable doctrine Brookfield v: Rock Island Improvement Co , 205 Ark 573, 169 S W 2d 662 (1943), However, even though the doctrine is equitable, the issue of unjust enrichment has been submitted to the jury in circuit court where the assertion is wrongful retention of money because the cause of action "is one corresponding with the common law action of assumpsit for money had and received " Arkansas Natl Bank v: Martin, 110 Ark. 578, 584, 163 S.W. 795 (1914) Spe also Hutclnnson v. Phillips, 11 Ark. 270 (1850) "The action for assumpsit is one for the recovery of damages for the nonperformance of a simple contract. Such a contract may be express or implied, and the action is based on the breach thereof, and is therefore ex contractu " Bertig v. Norman, 101 Ark. 75, 80, 141 S.W 201 (1911) "In both the civil and common law, rights and causes of action are divided into two classes — those arising ex contractu (trom a contract), and those arising ex delicto (from a delict or tort). -Helton v Sisters of Mercy of St: Joseph's Hospital, 234 Ark. 76, 85, 351 S.W 2d 129 (1961), quoting Black's Lau, Dictionary 660 4th ed. (1 9 51) (citing 3 Black-stone's Commentary 117): The use of courts of law in such actions is illustrated by a discussion in Import Motors v. Luker, 268 Ark 1045, 599 S.W.2d 398 (1980), where this court stated: The right to recover the $5,000,00 is on the basis of the common lAw Action of as q impsit Assiimrit his its origin in relief
111 1_51 NA1 L BANK I' CLUJ 1111S 536 Cite as 3b0 Ark 528 (2005) [360 anciently afforded by chancery in respect to an implied obligation arising by operation of law, and is grounded in equitable principle, In Hartford Accident & Indemnity Co: v Benevento,133 NUL 315, 44 A. 2d 97 (1945), the court said the action of assumpsit has been extended: To almost every case where an obligation arises from natural reasons, and the just construction oflaw, that is quasi ex contractu It hes only for money, which ex aequo et bow), the defendant ought to refund This action is greatly favored by the courts It is less restricted and fettered by technical rules and formalities than any other form of action : It approaches
nearer to a bill in equity than any other common law action This concept is supported by United States iletferson Eke Mfg Co , 291 U S 386,54 S Ct 443; Holcomb v Kentucky Union Co., 262 Ky 192, 90 S W 2d 25; Beauregard v Orleans Trust Co , 108 Vt, 42, 182 A, 182; and Allen v Mendelsohn & Co , 207 Ala 537, 93 So 416, In the latter case the court said! Assumpsit is an action of an equitable character, liberal in form, and greatly favored by the court as a remedy no agreement is necessary; assumpsit will lie wherever the circumstances are such that the law, ex debito justitiae will imply a promise. While an action of assumpsit, although based on equitable principles is an action at law, the law is well settled that when the chancery court has jurisdiction of a case for one purpose, it will retain jurisdiction to settle the rights of the parties arising out of the subject matter, Austin v Dertnott Canning Co:, 182 Ark: 1128, 34 S W2d 773 (1931); Spears v Rich, 241 Ark. 15, 405 S.W2d 929 (1966) Unquestionably, this action for injunctive and other relief was one cognizable in equity, and therefore, the court has jurisdiction to do complete justice as between the parties Import Motors, 268 Ark: 1052-53: In Fite v: Fite, 233 Ark. 469, 345 S.W.2d 362 (1961), this court stated: The decisive questions for decision are whether the tnal court erred in submitting the issues to the jury on the principle of unjust enrichment, and whether the facts in this case sustain an application of that principle
FIRST NAT'L BANK V: CRUTHIS ARK I Citelc lho Ark 528 (2005) 537 We find that the principle of unjust enrichment is more frequently applied in courts of Chancery, but as heretofore noted, it is also recognized in courts of law It has been approved b y this court as apphed to a law court in the case of Arkansas National Bank v Martin, 110 Ark 578, 163 S W 795 This case was tried in Circuit Court of Garland County on dissimilar facts hut involving the principle of unjust ennchment Fite, 233 Ark. at 472-73: [10] Thus, although unjust enrichment is an equitable cause of action, because it is based on the alleged breach of an implied contract, it may be heard in circuit court and may be heard by a jury. See, e.g., Fite, supra. However, we must reverse because restitution was not the only equitable remedy sought in Count I: FNB also sought an equitable lien on certain property. An equitable lien is a right to have a demand satisfied from a particular fund or specific property. Kane Enter. v, MacGrevr, Inc., 322 F:3d 371 (5th Cm 2003) (quoting Blacks Law Dictionary 934 7th ed: (1999)). An equitable lien has also been defined as a remedy that awards a nonpossessory interest in property to a party who has been prevented b y fraud, accident or mistake from securing that to which he was equitably entitled: J. Lorimer v: Berrelez, 331 F. Supp.2d 585 (E.D. Mich. 2004) (quoting Senters v. Ottawa Say. Bank, 443 Mich: 45, 503 N.W.2d 894 (1993): An action on an equitable lien was historically heard in chancery court because it is an equitable remedy. See Dews v. Hallibutton Indus. Inc., 288 Ark. 532. 708 S.W.2d 67 (1986), Rose City Bottling Works v: Godchaux Sugars, Inc_ 151 Ark. 269. 256 S.W. 825 (1922). Because an equitable lien was sought. the circuit court erred in submitting Count I to the jury, and because we reverse on this basis, we need not address the remaining issues. Reversed and remanded.
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