JIM HANNAH, Chief Justice.
This appeal requires us to consider whether, pursuant to Arkansas's landlord-lien statute, Arkansas Code Annotated section 18-41-101 (Repl.2003), a purchaser of crops has a duty to make a reasonable investigation or inquiry as to whether the seller of crops is a tenant or owner of the farmland on which the crops were produced. The cross-appeal concerns attorneys' fees and the application of a setoff.
Appellant Riceland Foods, Inc., appeals the circuit court's order holding Riceland liable for rent that tenant Bob Burress did not pay, under a farm lease that Burress entered into with appellees Randy Pearson and Carolyn Walker, co-trustees of the Moore Inter Vivos Trust ("the Trust"). Riceland contends that the circuit court erred as a matter of fact and law when, pursuant to section 18-41-101, it entered judgment against Riceland. Riceland claims that the Trust's statutory lien is not enforceable against Riceland because Riceland bought rice from Burress in good faith and without notice that Burress was a tenant who had failed to pay rent to the Trust. Riceland also claims that the circuit court erred when it entered judgment against Riceland and required Riceland to satisfy the judgment before separate appellant St. Francis County Farmers Association ("SFCFA") did so.
On cross-appeal, the Trust contends that the circuit court erred in failing to award the Trust reasonable attorneys' fees against Riceland and SFCFA. The Trust further contends that the circuit court erred when it granted Riceland and SFCFA a setoff for a settlement paid by Cargill, Inc., a former party to the suit.
We assumed jurisdiction of this case because it involves a substantial question of law concerning the interpretation of an act of the General Assembly. Thus, our jurisdiction is pursuant to Arkansas Supreme Court Rule 1-2(b)(6) (2009). We reverse and remand on direct appeal and affirm on cross-appeal.
The Trust leased 1138 acres of farmland it owned in St. Francis County to Bob Burress, for a period of five years commencing in 2005 for cash rent of $95,550 per year. Burress did not pay $57,330 of the rent for the crop year 2005 that was due on January 10, 2006. The Trust brought suit against Burress, SFCFA, Riceland, and Cargill. The Trust sought judgment for the unpaid rent against tenant Burress and secured creditor, SFCFA, which financed Burress's crop and had obtained proceeds from the crop. In addition, the Trust sought judgment from Riceland and Cargill, because they had purchased all the rice and soybeans grown on the Trust's land and paid the proceeds to Burress and SFCFA.
In an amended complaint, the Trust also sought attorneys' fees and costs. Burress filed a counterclaim against the Trust, and
The circuit court bifurcated the lien and rent issues from the rest of the case. The court convened a jury trial, and the jury returned a verdict against Burress in the amount of $4125 for "other elements of damage." Prior to trial, the Trust settled its claim against Cargill, so the claims against Cargill were dismissed with prejudice.
The circuit court, sitting as trier of fact on equity matters, ordered
Subsequent to these findings, SFCFA paid the Trust certain monies and received from the Trust a satisfaction of judgment and release of all claims. Riceland appeals, and the Trust cross-appeals against Riceland and SFCFA.
Before addressing the merits of Riceland's arguments, we must determine whether this appeal is moot. On appeal, Riceland claims that this court should reverse and vacate the circuit court's judgment requiring it to pay approximately
As a general rule, the appellate courts of this state will not review issues that are moot. Cotten v. Fooks, 346 Ark. 130, 55 S.W.3d 290 (2001). To do so would be to render advisory opinions, which this court will not do. Id. We have generally held that a case becomes moot when any judgment rendered would have no practical legal effect upon a then-existing legal controversy. Id. In other words, a moot case presents no justiciable issue for determination by the court. Shipp v. Franklin, 370 Ark. 262, 258 S.W.3d 744 (2007). Here, our judgment in this case would have a practical legal effect upon an existing controversy, namely whether Riceland could be liable to SFCFA. Accordingly, we turn to the arguments on appeal.
In 1868, the General Assembly enacted Arkansas's landlord-lien statute, which provided in relevant part: "That every landlord shall have a lien upon the crop grown upon the demised premises in any year for rent that shall accrue for such year, and such lien shall continue for six months after such rent shall become due and payable." See Act of July 23, 1868, No. 67, § 1, 1868 Ark. Acts 245, 245. The statute has remained mostly unchanged since its inception.
Id. at 96.
The current version of section 18-41-101 provides:
Riceland asserts that the circuit court erred as a matter of fact and law when it entered judgment against Riceland pursuant to Arkansas's landlord-lien statute. Riceland contends that the Trust's statutory lien is not enforceable against Riceland because it bought rice from Burress in good faith and without notice that Burress was a tenant who had failed to pay rent to the Trust.
Riceland does not challenge that a landlord's lien is perfected automatically, or that the lien has priority over any other security interest in the same crop. Rather, Riceland maintains that the landlord's lien was not properly applied against Riceland, a good-faith buyer of Burress's crops.
At the hearing on the landlord's lien issue, Randy Pearson, co-trustee of the Trust, testified that he was not aware of any notice of a landlord's lien given by the Trust to Riceland. Tenant Burress testified that when he delivers rice that he has grown, he tells the purchaser what farm the rice comes from and informs the purchaser of the Farm Service Agency ("FSA") farm number. Burress stated that he was unsure whether the FSA office would inform a purchaser who owns the land. Finally, Burress testified that he did not inform Riceland that the rice came from the Trust's farm.
Terry Richardson, Vice-President for Administration of Members Services and Corporate Secretary for Riceland, testified that he did not know whether Riceland could have contacted the FSA office to find out who owned the farm where Burress grew the rice or whether he could have learned from the FSA office if rent had been paid. Richardson said that he did not know whether the FSA office could provide this information because Riceland does not ask for the information. Richardson further stated that he never received notice from the landlord of any kind of lien filed against the 2005 crop.
The circuit court made the following findings:
This court has held that if a tenant sells the crop to a purchaser without notice of the landlord's lien, the buyer takes title free of the lien. Holmes v. Riceland Foods, Inc., 261 Ark. 27, 546 S.W.2d 414 (1977); Van Etten v. Lesser-Goldman Cotton Co., 158 Ark. 432, 250 S.W. 338 (1923). In Van Etten, we explained:
Van Etten, 158 Ark. at 433-34, 250 S.W. at 338.
To address Riceland's argument on appeal, we must determine whether, as the circuit court concluded, pursuant to section 18-41-101, a purchaser of crops has a duty to make a reasonable investigation or inquiry as to whether the seller of crops is a tenant or owner of the farmland from which the crops were produced. This court reviews issues of statutory interpretation de novo, because it is for this court to determine the meaning of a statute. McMickle v. Griffin, 369 Ark. 318, 254 S.W.3d 729 (2007). Our standard of review for issues of statutory construction is well settled:
Great Lakes Chem. Corp. v. Bruner, 368 Ark. 74, 82, 243 S.W.3d 285, 291 (2006) (internal citations omitted).
As previously noted, section 18-41-101 provides:
No words in the landlord-lien statute specifically refer to a duty on the part of the purchaser; however, it is clear from our case law interpreting the statute that we have held, in certain situations, purchasers have a duty to make a reasonable investigation regarding whether crops are subject to the lien of a landlord. See, e.g., Holmes, supra; Merchants' & Planters' Bank v. Meyer, 56 Ark. 499, 20 S.W. 406 (1892).
In Holmes, we concluded that Riceland, a purchaser of rice and soybeans from Frank and Louis Alpe and Alpe Farms, Inc., was "unquestionably on notice" of a landlord's lien where Louis Alpe informed Riceland that the crops had been grown by the Alpes as tenants, attached to an FHA security agreement were waivers by which the various lenders to some extent subordinated their liens to the FHA's advances, and Riceland checked the records every summer to discover liens against its members. Holmes, 261 Ark. at 28, 30, 546 S.W.2d at 415. We stated that "Riceland had more than sufficient information to require it to make a reasonable inquiry, which would have disclosed the landlord-tenant relationship." Id. at 28, 546 S.W.2d at 416.
In Meyer, we held that a grocery company that had bought cotton acquired notice of a lien so that it could be held liable to the landlord for damages suffered by him due to the destruction of the lien. The court wrote:
Meyer, 56 Ark. at 504-05, 20 S.W. at 407.
In Lesser-Goldman Cotton Co. v. Miller, 169 Ark. 1099, 277 S.W. 865 (1925), we concluded that the following facts gave rise to a duty to inquire on the part of the purchaser:
Miller, 169 Ark. at 1101, 277 S.W. at 865-66.
The instant case is distinguishable from Holmes, Meyer, and Miller. Prior versions of the landlord-lien statute were at issue in those cases; however, the language regarding the liens remains virtually unchanged, save the reiteration of the landlord's priority in section 18-40-101(b)(1), as amended in 2003.
In contrast to Holmes, Meyer, and Miller, there is no evidence in the instant case that Riceland had any knowledge that would require it to make an investigation regarding a landlord's lien. The circuit court specifically found that "no notice was given by anyone to Riceland" of the existence of a landlord's lien. Burress testified that he did not inform Riceland that he was a tenant or that there was a lien on the crops. Riceland's representative, Terry Richardson, testified that Riceland had no knowledge of the lien. In none of our
Because we have concluded that the circuit court erred in enforcing the landlord's lien against Riceland, we need not address Riceland's argument regarding the priority of satisfying the judgment.
The Trust contends that the circuit court erred when it failed to award the Trust reasonable attorneys' fees against SFCFA in favor of the Trust. SFCFA contends that the Trust is not entitled to pursue a claim for attorneys' fees against SFCFA because the Trust gave to SFCFA a satisfaction of judgment and release of all claims after SFCFA paid the judgment. We agree.
The satisfaction, captioned "Satisfaction of Judgments and Release of All Claims As to St. Francis County Farmers Association Only," provides that the Trust was given judgment against SFCFA in the sum of $57,330, as of May 19, 2008, plus prejudgment interest at six percent per annum from January 10, 2006, to May 19, 2008, and postjudgment interest at seven and one-quarter percent per annum from May 19, 2008, less $2500 paid by Cargill. The satisfaction noted that the Trust was "not granted judgment for attorneys fee or costs against Defendant SFC Co-op." Finally, the satisfaction also provides that the Trust "release[s] any and all claims they have or may have against St. Francis County Co-op arising from this litigation." Because the satisfaction released SFCFA from any and all claims arising from the litigation, and the attorneys' fees sought by the Trust arise from the litigation, the Trust is barred from seeking fees from SFCFA.
We need not consider the Trust's argument concerning the circuit court's denial of the Trust's request for attorneys' fees from Riceland because we have concluded that the circuit court erred in enforcing the landlord's lien against Riceland. Even assuming attorneys' fees pursuant to Arkansas Code Annotated section 16-22-308 (Repl.1999) would be allowed for the claims in this case, the Trust is no longer the prevailing party and is, therefore, not entitled to fees. Id.
The Trust contends that the circuit court erred when it awarded Riceland and SFCFA a setoff for the settlement paid by Cargill. We need not consider the Trust's argument as it relates to Riceland, as we have concluded that the circuit court erred in enforcing the landlord's lien against Riceland. We also do not consider the Trust's argument as it relates to SFCFA because the satisfaction released SFCFA from any and all claims arising from this litigation.
Reversed and remanded on direct appeal; affirmed on cross-appeal.
DANIELSON, J., dissents.
Because the majority disregards the entirety of the General Assembly's 2003 amendment of Arkansas Code Annotated § 18-41-101, I respectfully dissent.
While the bulk of the landlord-lien statute has remained virtually unchanged since its inception, Act 32 of 2003, § 3 did amend the substance of the statute. In that amendment, the legislature not only attempted to restore the prior landlord-lien statutory scheme, as acknowledged by the majority, but it also took pains to add language regarding the perfection of a landlords' lien. Specifically, the "2003 amendment inserted the present second sentence." See Ark.Code Ann. § 18-41-101 Amendments. That second sentence provides:
Ark.Code Ann. § 18-41-101(b)(1) (Repl. 2003) (emphasis added).
Since essentially the beginning of Arkansas jurisprudence, but prior to the 2003 amendment, this court had held that it was settled that "if a tenant sells the crop to a purchaser without notice of the landlord's lien, the buyer takes title free of the lien." Holmes v. Riceland Foods, Inc., 261 Ark. 27, 546 S.W.2d 414 (1977) (citing Van Etten v. Lesser-Goldman Cotton Co., 158 Ark. 432, 250 S.W. 338 (1923); Puckett v. Reed, 31 Ark. 131 (1876)). And, as the majority acknowledges, we observed in 1923:
Van Etten v. Lesser-Goldman Cotton Co., 158 Ark. at 433-34, 250 S.W. at 338. The question, then, is whether this caselaw is still controlling after 2003, when the General Assembly added language regarding the perfection of a landlord lien. I cannot say that it is.
Our caselaw has always provided that a landlord lien is had and that one without notice of the lien is an innocent purchaser of crops. Despite this well-settled doctrine, however, the General Assembly saw fit to add the additional language contained in (b)(1). While the majority deems that subsection a reiteration of the landlord's priority, I believe that the amendment is much more significant.
We have long held that the General Assembly is presumed to be aware of this court's decisions. See Smith v. Shelter Mut. Ins. Co., 327 Ark. 208, 937 S.W.2d 180 (1997). Therefore, had the General Assembly simply sought to reestablish the landlord-lien law as it was prior to 2001
The added language provides that the landlord lien is perfected. "Perfect" is defined as:
Black's Law Dictionary 1173 (8th ed.2004). See also Wright v. City of Little Rock, 366 Ark. 96, 233 S.W.3d 644 (2006) ("Perfected means that all legal steps have been taken which are necessary to complete the action undertaken. See Black's Law Dictionary 1173 (8th ed.2004")). With the import of the term "perfect" in mind, it is clear that since 2003, the landlord-lien statute, by its plain language, has provided that, once a landlord has a lien, it is perfected. In other words, the landlord has done all that is necessary to secure his interest and provided the necessary notice.
It would seem, then, that a purchaser is now charged with notice, or notice is presumed, once the landlord has his lien. That being the case, a purchaser would then have a duty to inquire or investigate as to the owner of the land before paying for the crop. Therefore, the circuit court did not err in finding a duty to inquire. Accordingly, neither actual nor constructive notice was necessary, as claimed by Riceland, as notice was presumed and automatic upon the establishment of the Trust's lien. Because Riceland was charged with notice but failed to make an inquiry, I would affirm the circuit court's order.