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AMI 3002 Measure of Damages—Failure to Exercise Ordinary Care

Arkansas Supreme Court Committee On Jury Instructions-Civil

Ark. Model Jury Instr., Civil AMI 3002
Arkansas Model Jury Instructions-Civil
November 2021 Update
Arkansas Supreme Court Committee On Jury Instructions-Civil
Chapter 30. Bank Deposits and Collections
AMI 3002 Measure of Damages—Failure to Exercise Ordinary Care
[If you decide for (plaintiff) on the question of liability] [If an interrogatory requires you to assess the damages of (plaintiff)], you must then fix the amount of money that will reasonably and fairly compensate (plaintiff) for [any of] the following (number) element(s) of damage:
[First: The amount of the check(s) (reduced by any amounts recovered by (plaintiff) from other sources) (reduced by the amount of any checks {or parts thereof} you find were intended to be directed to (name of party cashing or depositing checks));] [and]
[Second: If (plaintiff) has proved that (defendant) acted in bad faith, any other damages (plaintiff) suffered as a proximate consequence.]
NOTE ON USE
Use this instruction with AMI 3001.
Use the second bracketed element when there is evidence from which the jury could find that the bank acted in bad faith.
COMMENT
This instruction is based on Ark. Code Ann. § 4-4-103(e), American State Bank v. Union Planters Bank, N.A., 332 F.3d 533 (8th Cir. 2003), and Starkey Constr., Inc. v. Elcon, Inc., 248 Ark. 958, 457 S.W.2d 509 (1970).
Ark. Code Ann. § 4-4-103(e) provides that the “measure of damages for failure to exercise ordinary care in handling an item is the amount of the item reduced by an amount that could not have been realized by the exercise of ordinary care.” (emphasis added) The Committee had no guidance in Arkansas law as to whether the italicized phrase applies in the situation in which the loss allocation provisions of either Ark. Code Ann. §§ 4-3-406 or 4-4-406 are applicable and, therefore, did not include that phrase in the first element of this instruction. Trial courts should determine whether that part of § 4-4-103(e) should be included in the context of the loss allocation provisions of Ark. Code Ann. §§ 4-3-406 or 4-4-406. However, the Committee believes that the italicized phrase should be included if the provisions of Ark. Code Ann. §§ 4-3-406 or 4-4-406 are not applicable. Compare Citizens Bank, Bentonville v. Chitty, 285 Ark. 55, 684 S.W.2d 814 (1985). In that situation, the first part of the first element of the instruction should read as follows: “First, The amount of the check(s) reduced by an amount that could not have been realized by the exercise of ordinary care.”
The second element of this instruction is taken directly from Ark. Code Ann. § 4-4-103(e). The Committee had no guidance in Arkansas law as to how “bad faith” should be defined and whether there are essential elements required to find “bad faith.” In addition, the Committee had no guidance as to the types of damages that are recoverable if “bad faith” is found by the jury. Accordingly, trial courts should determine those issues in the context of the cases in which they are presented until there is guidance from Arkansas appellate courts.
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