                                     Cite as 2016 Ark. App. 155


                     ARKANSAS COURT OF APPEALS
                                           DIVISION I
                                          No. CV-15-547



                                                 Opinion Delivered   March 9, 2016

   CYNTHIA ANN CHANDLER,                         APPEAL FROM THE PULASKI
   ADMINISTRATRIX OF THE                         COUNTY CIRCUIT COURT,
   ESTATE OF JAMES EDWARD                        THIRTEENTH DIVISION
   HARRIS, DECEASED                              [NO. 60PR-12-1379]
                     APPELLANT
                                                 HONORABLE COLLINS KILGORE,
   V.                                            JUDGE

   SHARRON HARRIS
                             APPELLEE            AFFIRMED IN PART; REVERSED
                                                 AND REMANDED IN PART


                                    BART F. VIRDEN, Judge


        Cynthia Chandler, the administratrix of the estate of her father, James Harris, appeals

the order of the Pulaski County Circuit Court that found that all estate property should go

to Harris’s surviving spouse, appellee Sharron Harris. Chandler argues that the circuit court

erred in its application of Ark. Code Ann. § 28-39-101(b) (Repl. 2012) concerning spousal

allowances and in its decision concerning ownership of certain corporate property. We

affirm in part and reverse and remand in part.




                                                  1
                                    Cite as 2016 Ark. App. 155

       The decedent, James Harris, died intestate on June 24, 2012, survived by Chandler,

his only child, and Harris. Harris and the decedent had been married since 1979.

       On July 25, 2012, Chandler petitioned for appointment as administratrix of her

father’s estate. She was appointed by an order entered on July 26, 2012. She accepted the

appointment and letters of administration were issued that same day.

       Chandler filed an inventory of the estate on February 17, 2014, with an approximate

total value of $544,000. This included $514,774 of stock in Jim Harris Realty, Inc. (JHR,

Inc.), and approximately $30,000 of other property, consisting mostly of guns, hunting and

fishing equipment, and a boat and trailer. 1

       Harris objected to the inventory, claiming that it included property she and the

decedent had acquired during their marriage, such as the stock in JHR, Inc. She also asserted

that all property listed in the inventory, including the JHR, Inc. stock, was her property.

Chandler filed a response to Harris’s objection, arguing that the concept of marital property

did not apply and that there was a difference between what was marital property in the

context of divorce and what was property of the estate.

       A hearing on the objection was held on June 23, 2014. On September 18, 2014, the

circuit court issued its letter opinion. The court found that two First Security Bank accounts

(approximately $183,256) were not corporate accounts because they were payable on the

decedent’s death and passed to Harris outside of probate. A five-acre tract of real property

in Dallas County was found to have been titled solely in the decedent’s name and, as such,


       1
        Attached to the inventory was a list of corporate assets taken from the 2011 corporate
tax return.

                                                 2
                                        Cite as 2016 Ark. App. 155

passed to the estate subject to Harris’s dower interest. The court found that the parties had

agreed that the items listed in Exhibit 10 went to Chandler. 2 The court further found that,

unless Harris could show that it was titled jointly with the decedent, all other property listed

as corporate assets would go to JHR, Inc. Based on Subchapter S tax documents, the court

found that 150 shares of JHR, Inc., belonged to Harris as her separate property and that the

remaining 150 shares were to be equally divided between Harris and Chandler. The court

found the estate was not entitled to reimbursement from funds in a Capitol Bank account

allegedly used to pay Harris’s personal expenses because they were utilized for legitimate

business purposes. All other property was to be equally divided between Chandler and

Harris.

          Prior to entry of the court’s order, Chandler filed a motion for reconsideration,

arguing that, pursuant to Ark. Code Ann. § 28-11-305 (Repl. 2012), the stock in JHR,

Inc., should be divided 100 shares to Chandler and fifty shares to Harris. Harris responded

and counter-petitioned that specific items of personal property titled in both the decedent’s

and her name be found to be her individual property, which included the boat and trailer,

and that furnishings and appliances in the marital home be considered her property. She

attached title documents and invoices showing that the boats, trailers, four-wheelers, and

one vehicle were titled in the names of the decedent and Harris. One vehicle appeared to

be jointly titled in the corporation, the decedent, and Harris.

          After a hearing on the motions for reconsideration, a final order of distribution was

entered. The court found that the decedent and Harris had utilized JHR, Inc., for their


          2
              These were items that had sentimental value to Chandler.
                                                     3
                                    Cite as 2016 Ark. App. 155

personal expenses. The court left unchanged the disposition of the bank accounts and the

Dallas County real property; however, the court changed the distribution of some of the

property from its original letter opinion. The court divided the shares in JHR, Inc.,

belonging to the decedent 100 shares to Chandler and fifty shares to Harris. The court found

that, as the surviving spouse, Harris was entitled to such furniture, furnishings, appliances,

implements, and equipment as shall be reasonably necessary for her use and occupancy of

the marital dwelling. The court specifically found that all of the personal property listed in

the February 14, 2014 inventory, excluding the items in Exhibit 10, shall be vested in Harris

as such items of personal property were reasonably necessary for her use. 3 The court

specifically found, based on the testimony of CPA Tracy Fox and Harris, that the items

contained on Exhibit A to the inventory were assets owned individually by the decedent

and Harris and were in the nature of furniture, furnishings, appliances, implements, and

equipment reasonably necessary for her use and were therefore assigned to and vested in

Harris. 4 The court also found that a boat, motor, and trailer; two four-wheelers; a cargo

trailer; a 2008 Chevy Silverado; and a 2011 Chevy Tahoe were all titled in Harris’s name

and passed to her outside of probate. This appeal followed.




       3
         This finding specifically included a 1997 Welbilt boat, a 1997 Angler boat trailer, a
2004 Support Atlas 5 x 10 utility trailer, a 2005 T/A utility trailer, a 2011 Supp Big Tex
utility trailer, all shotguns and weapons reflected on the inventory, ammunition, gun cases,
fishing and hunting equipment, and unspecified furniture, furnishings, and appliances.
       4
        These items included the equipment, fixtures, and furniture; a pressure washer; a
phone system; a utility trailer; machinery; office equipment; a cargo trailer; a Kubota tractor
and implements; a trailer for the tractor; a disc for the tractor; computers; a fireproof safe;
and a refrigerator.
                                                  4
                                     Cite as 2016 Ark. App. 155

       We review probate matters de novo but will not reverse the probate court’s findings

of fact unless they are clearly erroneous. In re Estate of Kemp, 2014 Ark. App. 160, 433

S.W.3d 911. A finding is clearly erroneous when, although there is evidence to support it,

the appellate court is left on the entire evidence with the firm conviction that a mistake has

been committed. Id. We must also defer to the superior position of the lower court sitting

in a probate matter to weigh the credibility of the witnesses. Id.

       In her first point, Chandler argues that the probate court erred in its application of

Ark. Code Ann. § 28-39-101 and the timeliness of Harris’s request for a spousal allowance.

Section 28-39-101 is concerned with statutory allowances, which are simply other payments

to a surviving spouse and minor children. 5 There are actually three allowances provided by

the statute: (1) personal property or proceeds of the sale of personal property worth $4,000,

but if creditors’ claims prohibit this, then $2,000 as against creditors (Ark. Code Ann. § 28-

39-101(a)); (2) such furniture, furnishings, appliances, implements, and equipment necessary

for occupancy of the home will be vested in the surviving spouse, provided that he or she

was living with the decedent at the time of the decedent’s death (Ark. Code Ann. § 28-39-

101(b)); and (3) an allowance during the two months after the decedent’s death, of property

for sustenance, “in accordance with the usual living standards of the family,” but not to

exceed $1,000 (Ark. Code Ann. § 28-39-101(c)). These provisions are cumulative, and

sections (b) and (c) apply as against both creditors and distributees. Ark. Code Ann. § 28-

39-101(d). These allowances are also in addition to any rights of homestead or

dower/curtesy. Spears v. Spears, 213 Ark. 15, 209 S.W.2d 105 (1948). In this case we are


       5
           Here, there are no minor children.
                                                  5
                                      Cite as 2016 Ark. App. 155

concerned with the furniture and furnishings allowance under Ark. Code Ann. § 28-39-

101(b).

       We first address the timeliness issue. According to Chandler, Harris first requested a

spousal allowance in her response to Chandler’s posttrial motion for reconsideration. Harris

responded that she first asserted that the furniture, furnishings, appliances, implements, and

equipment were hers pursuant to sections 28-39-101 and 28-11-305 in a motion filed

shortly after the decedent’s death. Harris’s attorney also made an oral request for the

allowance at the hearing on the motion for reconsideration. The circuit court did not

specifically rule on the timeliness issue.

       Section 28-39-101 does not specify a time within which the surviving spouse can

request for an allowance of the personal property. Instead, section 28-39-101(a)(1) provides

that the election for an allowance can be made prior to the sale of the personal property or

from the proceeds of such sale. In construing predecessors to this statute, our supreme court

has held that such requests were timely as long as there were funds or personal property

from which to pay the allowances still in the hands of the personal representative. Wofford

v. James, 204 Ark. 700, 163 S.W.2d 710 (1942) (applying rule to monetary allowances); see

also Quick v. Davidson, 261 Ark. 38, 545 S.W.2d 917 (1977) (applying rule to allocation of

dower/curtesy). Chandler cites Wright v. Langdon, 274 Ark. 258, 623 S.W.2d 823 (1981),

in support of her argument. Wright is inapplicable to this case because it is not a probate case

dealing with a surviving spouse’s request for her statutory allowances. It is undisputed that

no final distribution had been made and that possession of the personal property was still




                                                   6
                                    Cite as 2016 Ark. App. 155

vested in Chandler as the personal representative. 6 Therefore, Harris’s request for her

statutory allowances was timely.

       Chandler next argues that the circuit court erred in awarding Harris her allowance

under section 28-39-101 because there was no showing that such property was necessary

for Harris’s use and occupancy of her home. Chandler also argues that the court erred in

awarding Harris, as part of her allowance, property that was titled in the corporate name.

Although we have concluded that Harris’s request for spousal allowances was timely, we

need not address whether the circuit court was correct in its application of section 28-39-

101 because the court erred in awarding property that was titled solely in the corporate

name to Harris as part of her statutory allowances.

       The circuit court found that the boats, four-wheelers, trailers, and pickup trucks were

titled in Harris’s name and passed to her outside of probate. However, at least some of the

documentary evidence shows that some items were titled solely in the corporate name,

making the court’s finding clearly erroneous. Section 28-39-101 is applicable to the personal

estate of the decedent. Our supreme court has held that a widow’s allowance under that

section cannot be awarded out of the estate of a partnership in which her deceased husband

had been a partner because partnership assets are not the separate property of the decedent

partner. See McLerkin v. Schilling, 192 Ark. 1083, 96 S.W.2d 445 (1936). This is akin to the

familiar rule that a corporation and its stockholders are separate and distinct entities, even

though a stockholder may own the majority of the stock. Thomsen Family Trust v. Peterson



       6
        See Ark. Code Ann. § 28-49-101; Dean v. Brown, 216 Ark. 761, 227 S.W.2d 623
(1950); Jensen v. Housley, 207 Ark. 742, 182 S.W.2d 758 (1944).
                                                 7
                                     Cite as 2016 Ark. App. 155

Family Enters., Inc., 66 Ark. App. 294, 989 S.W.2d 934 (1999). A stockholder does not

acquire any estate in the property of a corporation by virtue of his stock ownership; the full

legal and equitable title thereto is in the corporation. Id.

       The circuit court clearly erred in awarding Harris her statutory allowance out of

corporate property. Accordingly, we reverse on this point and remand for further

proceedings consistent with this opinion.

       Under her second point, Chandler argues that the circuit court erred in its ruling that

Harris owned one-half of the corporate stock in her own right. Chandler’s argument is that

there is no record of one-half (150 shares) of the corporate stock being transferred from the

decedent to Harris. Harris testified that she owned 150 shares in JHR, Inc., as a tenant by

the entirety. The record contains documentation that the decedent and Harris made an

election to have JHR, Inc., treated as a Subchapter S corporation, with the decedent and

Harris each owning 150 shares of stock since June 1985. There are also documents from the

state and federal tax authorities acknowledging receipt of the election documents.

       The fact that there was no transfer of the shares on the corporate books is not

dispositive. The statutes relating to the transfer of shares are designed to protect the

corporation in the payment of dividends and are not concerned with the rights of the parties

transferring the stock. See Ashley v. Ashley, 393 A.2d 637 (Pa. 1978). The Subchapter S

election is also some evidence of a gift of 150 shares to Harris. The election was a

representation made to a third party, the federal and state tax authorities, that a gift of the

shares had been made to Harris and is presumably true. Physical delivery of the stock




                                                   8
                                      Cite as 2016 Ark. App. 155

certificates is not an essential element of an inter vivos gift of stock. Bettis v. Bettis, 96 Ark.

App. 101, 239 S.W.3d 5 (2006).

       Chandler contends that the decision on the stock ownership comes down to whether

the corporate documents control or whether the Subchapter S election controls. However,

it was not just the documents because Harris testified that she owned corporate stock. The

documents from the tax authorities serve to corroborate Harris’s testimony that the election

was made. Moreover, the circuit court relied on both the testimony and documentary

evidence in finding that Harris owned 150 shares in her own right. Our standard of review

decides this issue: “Where there are two permissible views of the evidence, the fact-finder’s

choice between them cannot be clearly erroneous.” Rymor Builders, Inc. v. Tanglewood

Plumbing Co., Inc., 100 Ark. App. 141, 147, 265 S.W .3d 151, 155 (2007).

       Finally, Chandler argues that the circuit court erred in awarding Harris certain

corporate property as her separate property. Even though we have reversed the court’s

award of Harris’s statutory allowances out of corporate property, there is one other point

we need to address. Although Chandler contends that the First Security Bank accounts were

corporate property because they used the corporate ID number, she concedes in her brief

that the accounts were titled jointly in the names of the decedent and Harris. Therefore, the

court correctly ruled that those accounts passed to Harris outside of probate as payable-on-

death accounts.

       Affirmed in part; reversed and remanded in part.

       GLADWIN, C.J., and GRUBER, J., agree.

       William G. Almand, P.A., by: William G. Almand, for appellant.
       Bequette & Billingsley, P.A., by: Keith I. Billingsley, for appellee.
                                                    9
