Lookabaugh v. Hanna Oil & Gas Co. , 2014 Ark. App. LEXIS 582 ( 2014 )

Cite as 2014 Ark. App. 445
ARKANSAS COURT OF APPEALS
DIVISION II
No. CV-13-651
J.C. LOOKABAUGH Opinion Delivered September 3, 2014
APPELLANT
APPEAL FROM THE SEBASTIAN
COUNTY CIRCUIT COURT, FORT
SMITH DISTRICT
V. [NO. CV-13-424]
HONORABLE JAMES O. COX,
JUDGE
HANNA OIL AND GAS CO.
APPELLEE AFFIRMED
PHILLIP T. WHITEAKER, Judge
Appellant J.C. Lookabaugh appeals from an order of the Sebastian County Circuit
Court granting summary judgment in favor of appellee Hanna Oil & Gas Co. (“Hanna”).
Hanna filed a complaint against J.C., raising claims of fraud and unjust enrichment. J.C.
answered and moved to dismiss. Hanna subsequently moved for summary judgment, and the
circuit court granted Hanna’s motion on its claim for unjust enrichment. On appeal, J.C.
urges that the circuit court erred in two respects: first, in considering an affidavit attached to
Hanna’s posttrial brief, and second, in granting Hanna’s summary-judgment motion while
denying his motion to dismiss. We find no error and affirm.
Cite as 2014 Ark. App. 445
I. The Affidavit
In his first point on appeal, J.C. argues that the circuit court gave improper
consideration to an affidavit attached to a posttrial brief filed by Hanna in violation of
Arkansas Rule of Civil Procedure 56(c). That rule provides, in pertinent part, that “[n]o party
shall submit supplemental supporting materials after the time for serving a reply [to a motion
for summary judgment], unless the court orders otherwise.”
In considering this issue, we must examine the basis for Hanna’s motion for summary
judgment and J.C.’s arguments made below. In its pleadings, Hanna asserted that, in 2002,
it acquired an interest in a natural gas well in Logan County. At that time, Hanna’s records
indicated that an overriding royalty interest was owned by J.C. Hanna did not have an address
for J.C., so it held the royalty in suspense. In 2010, Nate Buerer, a research specialist for ARI
Asset Recovery, contacted J.C. to inform him that ARI had discovered the royalties being
held in escrow.1 Hanna obtained a tax identification number from J.C. and, between July
2010 and October 2010, Hanna paid J.C. a total of $71,135.33 as overriding royalties. Hanna
subsequently discovered that the actual owner of the overriding royal interest was L.C.
Lookabaugh, J.C.’s brother. Hanna wrote to J.C. on several occasions and asked him to repay
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J.C. filed a third-party complaint against Buerer and ARI, alleging that they were the
ones who had informed him of the royalties and assisted him in completing the forms
necessary to obtain the royalties. J.C. therefore claimed that, should Hanna recover anything
from him, he was entitled to contribution from the third-party defendants. The third-party
defendants never answered, and the circuit court ultimately entered an order granting default
judgment against them and awarding J.C. $71,135.33.
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the $71,135.33. J.C. failed to do so. Hanna therefore filed its complaint against J.C. alleging
fraud and unjust enrichment.
At the subsequent summary-judgment hearing, J.C. argued, among other things, that
Hanna lacked standing to sue him for unjust enrichment. In essence, J.C. contended that only
L.C. Lookabaugh or his heirs would have standing to bring an unjust-enrichment claim,
because they—not Hanna—were the beneficiaries of the royalty payments. The circuit court
questioned the parties about the standing issue and requested simultaneous posttrial briefs on
the matter. In its brief, Hanna asserted that it had paid the lawful heirs of L.C. Lookabaugh
the royalties to which they were entitled. In support of this point, Hanna attached an affidavit
from Jackie Clotfelter, a Division Order Analyst for Hanna, stating that Hanna paid L.C.’s
heirs the overriding royalty interests, part of which had already been paid to J.C.
After submission of the briefs, the circuit court subsequently entered an order granting
summary judgment in favor of Hanna on its unjust-enrichment claim. J.C. filed a motion for
new trial, arguing that the circuit court improperly considered the affidavit that Hanna
attached to its posttrial brief, after the court had already conducted the summary-judgment
hearing. The circuit court denied the new-trial motion.
As noted above, Rule 56 prohibits the submission of supplemental materials without
direction by the court. On appeal, J.C. argues that Hanna’s affidavit constituted such
supplemental materials in violation of the rule. He maintains that the circuit court, by
referencing the affidavit in its order, must have improperly considered it in violation of Rule
56 in deciding to grant summary judgment in Hanna’s favor. We disagree.
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The affidavit did not violate Rule 56 because it does not provide supplemental material
on questions of fact pertaining to Hanna’s unjust-enrichment claim. Rather, the affidavit
addressed only Hanna’s standing to bring suit against J.C. See Chubb-Lloyds Ins. Co. v. Miller
Cnty. Circuit Court, 2010 Ark. 119, 361 S.W.3d 809 (“Only a claimant who has a personal
stake in the outcome of a controversy has standing.” (quoting Pulaski Cnty. v. Ark. Democrat-
Gazette, Inc., 371 Ark. 217, 220, 264 S.W.3d 465, 467 (2007)). The affidavit did not add to
or change the undisputed facts surrounding the question of whether J.C. had been unjustly
enriched by retaining the royalty payments to which he was undisputedly not entitled. Stated
another way, the affidavit did not touch on the issue of whether there were material questions
of fact that could have rendered summary-judgment improper. Rather, it informed the court
only that Hanna had suffered an injury (i.e., it had twice paid royalties that were owed to only
one party) and thus had standing to bring suit. In fact, the court’s only mention of Hanna’s
payment of royalties to L.C. Lookabaugh’s heirs came in the context of discussing Hanna’s
standing. Accordingly, the affidavit did not inform the court’s decision whether to grant
Hanna’s motion for summary judgment. We therefore affirm on this issue.
II. Summary Judgment
In his second point on appeal, J.C. argues that the circuit court erred in failing to grant
summary judgment in his favor. As noted above, J.C. filed a motion to dismiss in which he
alleged that Hanna had failed to state facts upon which relief could be granted. He further
urged the circuit court to treat his motion to dismiss as a motion for summary judgment
because he submitted matters outside of the pleadings for the court’s consideration. See Clark
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v. Ridgeway, 323 Ark. 378, 914 S.W.2d 745 (1996); Pritchett v. Evans, 2013 Ark. App. 679,
430 S.W.3d 223. On appeal, he argues that the circuit court should have granted his
summary-judgment motion because Hanna failed to state sufficient facts to state a claim
against him. As a general rule of appellate procedure, however, a denial of a motion for
summary judgment is not subject to review on appeal, even after a trial on the merits. See
Wilson v. Greg Williams Farm, Inc., 2014 Ark. App. 334, ___ S.W.3d ___ (citing Get Rid of
It Ark., Inc. v. Hughes, 368 Ark. 535, 247 S.W.3d 838 (2007)). Thus, to the extent J.C.
contends that the circuit court should have treated his dismissal motion as one for summary
judgment and granted it in his favor, we do not address his argument.
We do, however, address J.C.’s argument that the circuit court erred in granting
Hanna’s summary-judgment motion on its unjust-enrichment claim.2 Our law is well settled
that summary judgment is to be granted by a trial court only when it is clear that there are no
genuine issues of material fact to be litigated, and the party is entitled to judgment as a matter
of law. J-McDaniel Constr. Co., Inc. v. Dale E. Peters Plumbing Ltd., 2014 Ark. 282, ___
S.W.3d ___. Once the moving party has established a prima-facie entitlement to summary
judgment, the opposing party must meet proof with proof and demonstrate the existence of
a material issue of fact. Id. On appellate review, we determine if summary judgment was
appropriate based on whether the evidentiary items presented by the moving party in support
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We note that J.C. spends much of his argument contending that the circuit court
erred in finding that Hanna pleaded sufficient facts to state a claim for fraud. The circuit
court, however, did not grant summary judgment on Hanna’s fraud claim; instead, the
unjust-enrichment claim was the basis for the court’s decision.
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of the motion leave a material fact unanswered. Id. We view the evidence in the light most
favorable to the party against whom the motion was filed, resolving all doubts and inferences
against the moving party. Id. Our review focuses not only on the pleadings, but also on the
affidavits and other documents filed by the parties. Id.
To find unjust enrichment, a party must have received something of value, to which
he or she is not entitled and which he or she must restore. Hatchell v. Wren, 363 Ark. 107, 211
S.W.3d 516 (2005); Rigsby v. Rigsby, 356 Ark. 311, 149 S.W.3d 318 (2004). There must also
be some operative act, intent, or situation to make the enrichment unjust and compensable.
Hatchell, supra; Dews v. Halliburton Indus., Inc., 288 Ark. 532, 708 S.W.2d 67 (1986). In
general, recovery for unjust enrichment is based upon what the person enriched has received
rather than what the opposing party has lost. Sanders v. Bradley Cnty. Human Servs. Pub.
Facilities Bd., 330 Ark. 675, 956 S.W.2d 187 (1997). The issue of unjust enrichment is a
question of fact. Wilson v. Lester Hurst Nursery, Inc., 269 Ark. 19, 598 S.W.2d 407 (1980).
More specifically, in this case, the issue is whether the court erred in finding no material issues
of fact and granting summary judgment on Hanna’s unjust-enrichment claim.
The undisputed evidence introduced by Hanna showed that L.C. Lookabaugh was the
true owner of the overriding royalty interest; that Hanna had paid J.C. $71,135.33 for a
royalty interest that J.C. did not own; and that J.C. accepted and retained the benefit
conferred by Hanna, despite repeated requests for him to return the money. J.C. never offered
any countervailing proof that he, not his brother, owned the royalty interests. On these facts,
the circuit court found that it would be unjust and inequitable for J.C. to retain the royalties
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to which he was not entitled and correctly determined that there were no genuine issues of
material fact which would create a triable issue with reference to Hanna’s claim of unjust
enrichment.
J.C. nonetheless suggests that, because Hanna voluntarily paid him the money, it
should be barred from recovery. As a general rule, payments that are voluntarily made cannot
be recovered. Gautrau v. Long, 271 Ark. 394, 396, 609 S.W.2d 107, 109 (Ark. App. 1980).
Exceptions are found, however, when the payments are made as a result of duress, fraud,
failure of consideration, or mistake. Id. Here, Hanna’s payment to J.C. was based on a mistake
as to the true identity of the owner of the royalty interests. As such, the “voluntariness” of
Hanna’s payment to J.C. is not a bar to recovery.
Affirmed.
GLADWIN, C.J., and PITTMAN, J., agree.
Rush & Rush, by: David L. Rush, for appellant.
Daily & Woods, P.L.L.C., by: Thomas A. Daily and Colby T. Roe, for appellee.
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