Opinion
Appeal from the Washington County Chancery Court, No. E-91-1052, Lawrence Dawson, Judge.
Opinion dissenting from 884 S.W.2d 262.
BROWN, Justice, dissenting.
This decision to dismiss the appeal of Richard Haberman is premised on a point not argued by the parties. Moreover, the case of Croyden Associates v. Alleco, 969 F.2d 675 (8th Cir. 1992), appears to be factually distinguishable. I would deny the motion and consider the appeal on the merits.
First, neither Richard Haberman nor John Lisle argued failure to intervene with respect to the motion to dismiss. Yet, the majority fixes on the issue and embraces Croyden Associates v. Alleco, supra, as its reason for dismissal. The inherent unfairness in all this is that Richard Haberman has never had an opportunity to respond to the intervention argument because it was not raised by John Lisle in his motion.
Secondly, the case of Croyden Associates v. Alleco, supra, is distinguishable on its facts and should not be controlling. Haberman does not appeal from the settlement order, as was the case in Croyden, but rather from the subsequent order setting the amount of legal fees. He hinged his standing to appeal on his membership in the certified class and his objection to the method of calculating fees, though Lisle contests this, and points to the fact that there is no one else requesting review of the fee decision. An important point in all this is the settlement order stated that legal fees would not be taken from the taxpayer money illegally exacted (see Ark.Code Ann. § 26-35-902 (Repl.1992)) but would be taken from the general funds of the City of Fayetteville. This means that no class member's refund would be diminished. Named class representatives, consequently, had no incentive to question legal fees. The City of Fayetteville was a party to the settlement and had agreed not to appeal an attorney's fee award. That left no one except unnamed class members to raise the issue.
Haberman did appear before the trial court and object to the method of calculating fees as the published notice required. To hold that in addition he should have formally intervened appears to be unduly technical. Public policy would seem to demand that unnamed class members be allowed to request review of the propriety of paying several million dollars out of city funds, though the appeal may ultimately prove to be unsuccessful and the legal fees awarded may prove to be appropriate. Even assuming Croyden is factually on point, unnamed class members should be permitted standing to contest an attorney's fee when the paying entity--in this case the City of Fayetteville--does not do so. There is certainly authority for this position. See, e.g., Bell Atlantic Corp. v. Bolger, 2 F.3d 1304 (3d Cir. 1993); In re Cement Antitrust Litig., 688 F.2d 1297 (9th Cir. 1982) (dictum), aff'd sub nom Arizona v. Ash Grove Cement Co., 459 U.S. 1190, 103 S.Ct. 1173, 75 L.Ed.2d 425 (1983); Patterson v. Stovall, 528 F.2d 108 (7th Cir. 1976); Ace Heating & Plumbing Co. v. Crane Co., 453 F.2d 30 (3d Cir. 1971) (dictum). In Bell Atlantic Corp., the third circuit specifically rejected the Croyden rule of "no intervention, no standing" for appeals by unnamed class members. The court concluded:
Assuring fair and adequate settlements outweighs concerns that non-intervening objectors will render the representative litigation "unwieldy." It is sufficient that Lazar attended the settlement hearing and voiced before the district court the same objections he now raises before us on appeal.
Furthermore, this court will treat actions by non-parties as the equivalent of an intervention in unusual circumstances when the public interest is involved. See Arkansas Best Corp. v. General Elec. Cap. Corp., 317 Ark. 238, 878 S.W.2d 708 (1994). This is just such a case.
I would find standing in Haberman to bring this appeal and decide the case on the merits.
DUDLEY and HAYS, JJ., join in this dissent.