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https://www.courtlistener.com/api/rest/v3/opinions/4523614/ | J-S71028-19
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
COMMONWEALTH OF PENNSYLVANIA : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
:
v. :
:
:
EDWARD LEONARD RIVERA JR. :
:
Appellant : No. 2050 EDA 2019
Appeal from the Judgment of Sentence June 21, 2019
In the Court of Common Pleas of Carbon County Criminal Division at
No(s): CP-13-CR-0000917-2015
BEFORE: BOWES, J., MURRAY, J., and McLAUGHLIN, J.
MEMORANDUM BY MURRAY, J.: FILED APRIL 08, 2020
Edward Leonard Rivera Jr. (Appellant) appeals from the judgment of
sentence imposed after he pled guilty to receiving stolen property.1 Upon
review, we affirm.
Appellant raises one issue on appeal:
WHETHER THE TRIAL COURT COMMITTED AN ERROR OF LAW
AND/OR ABUSE OF DISCRETION BY DENYING APPELLANT
EDWARD RIVERA, JR.’S PRE-SENTENCE MOTION TO WITHDRAW
HIS GUILTY PLEA, BY FINDING PREJUDICE TO THE
COMMONWEALTH DUE TO THE DEATH OF AN UNINVOLVED
PURPORTED WITNESS WHERE THE DECEASED FAILED TO MAKE
A WRITTEN STATEMENT, REPORT THE CRIME, OR OTHERWISE
AVAIL HIMSELF TO AID THE COMMONWEALTH’S
INVESTIGATION?
Appellant’s Brief at 9.
The trial court summarized the relevant facts and procedure as follows:
____________________________________________
1 18 Pa.C.S.A. § 3925(a).
J-S71028-19
On or about August 16, 2016, [Appellant] entered a guilty
plea to one count of Receiving Stolen Property. . . . On June 30,
2017, subsequent to the withdrawal of his then-counsel,
[Appellant’s] current counsel, Joseph V. Sebelin, Jr. Esq., filed a
Motion to Withdraw Guilty Plea which this Court denied upon
[Appellant’s] failure to appear at a scheduled August 28, 2017
hearing thereupon.
Following a period of time in which [Appellant] had been
incarcerated in Schuylkill County, this [c]ourt scheduled
[Appellant’s] sentencing for May 18, 2018. [Appellant] filed his
Second Motion to Withdraw Guilty Plea on May 17, 2018.
This [c]ourt presided over a hearing on [Appellant’s] Second
Motion to Withdraw Guilty Plea on November 6, 2018. At the
November 6, 2018 [hearing], [Appellant] maintained his
innocence as to each pending charge. In addition to presenting
the testimony of Amy Burns, Felicia Urbanski, and Officer Joshua
Tom, the Commonwealth contended that it had been prejudiced
by the death of Brian Brossman (“Mr. Brossman”), an individual
contended by the Commonwealth to be a material witness and
who died on November 12, 2016, approximately three months
after [Appellant’s] August 16, 2016 guilty plea.
This [c]ourt denied [Appellant’s] Second Motion to Withdraw
Guilty Plea through its June 11, 2019 Order of Court.
Subsequently, this [c]ourt sentenced [Appellant] on June 21,
2019; [Appellant] thereafter, on July 15, 2019, filed this timely
appeal. This [c]ourt then directed [Appellant] to file a concise
statement of matters complained of on appeal by Order of Court
dated July 16, 2019 and filed on July 17, 2019. On July 29, 2019,
[Appellant] filed his “1925(b) Statement of Matters Complained of
on Appeal” (“[Appellant’s] 1925(b) Statement of Matters
Complained of on Appeal”).
Trial Court Opinion, 9/13/19, at 2-3.
In reviewing Appellant’s claim, we begin with a summary of the
applicable law:
“We review a trial court’s ruling on a [pre]sentence motion to
withdraw a guilty plea for an abuse of discretion.”
Commonwealth v. Islas, 156 A.3d 1185, 1187 (Pa. Super.
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2017) (citation omitted). Pennsylvania Rule of Criminal Procedure
591(A) provides that, “At any time before the imposition of
sentence, the court may, in its discretion, permit, upon motion of
the defendant, or direct, sua sponte, the withdrawal of a plea of
guilty or nolo contendere and the substitution of a plea of not
guilty.” Pa.R.Crim.P. 591(A).
“Although there is no absolute right to withdraw a guilty
plea, properly received by the trial court, it is clear that a request
made before sentencing should be liberally allowed.”
Commonwealth v. Kpou, 153 A.3d 1020, 1022 (Pa. Super.
2016) (cleaned up). “In determining whether to grant a
presentence motion for withdrawal of a guilty plea, the test to be
applied by the trial courts is fairness and justice.”
Commonwealth v. Elia, 83 A.3d 254, 262 (Pa. Super. 2013)
(cleaned up). Therefore, if the defendant provides a fair and just
reason for wishing to withdraw his or her plea, the trial court
should grant it unless it would substantially prejudice the
Commonwealth. Commonwealth v. Carrasquillo, 631 Pa. 692,
115 A.3d 1284, 1287 (2015) (citation omitted).
Commonwealth v. Williams, 198 A.3d 1181, 1184 (Pa. Super. 2018).
Appellant agrees that the trial court “properly found that Appellant
raised a ‘fair and just’ defense.” Appellant’s Brief at 14, 20.2 See also Trial
Court Opinion, 9/13/19, at 7 (finding that Appellant provided the court “with
more than just a bare assertion of innocence.”). However, Appellant
maintains that the trial court erred in finding that the Commonwealth would
be prejudiced by the withdrawal of Appellant’s plea because of the
____________________________________________
2 Appellant maintains he is innocent because the victim “gave the television
to Appellant as collateral for an unpaid obligation.” Appellant’s Brief at 10,
12.
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unavailability of “a material Commonwealth witness,” Brian Brossman, who
died three months after Appellant entered his plea.3 Appellant asserts “the
Commonwealth will not be prejudiced by either [Appellant’s] withdrawal of his
guilty plea or by having to go to trial without a plea or by having to go to trial
without a witness who passed away.” See Trial Court Opinion, 9/13/19, at 4-
5. Appellant claims the Commonwealth failed to demonstrate “substantial
prejudice” as required by Commonwealth v. Forbes, 299 A.2d 268, 271 (Pa.
1973) and Commonwealth v. Carrasquillo, 115 A.3d 1284 (Pa. 2015), and
avers the Commonwealth “would be in no worse position for this case due to
the death of [the witness].” Appellant’s Brief at 15. Appellant specifically
argues:
Appellant disputes that Brossman’s death constitutes a
“substantial prejudice” to the Commonwealth. Appellant
Brossman was not a key “witness” or otherwise willing to aid the
Commonwealth in the case against Appellant. Mr. Brossman was
not a witness to the alleged removal of items as he was not at the
house. He did not call the police in advance of the alleged
burglary. Throughout the investigation, Mr. Brossman did not
avail himself to aid the prosecution. He made no written
statement to the police. In fact, he avoided further interaction
with the police during their investigation. There is simply no
evidence that he ever testified or gave a sworn statement on this
matter. In short, other than an alleged oral statement, Brossman
was a virtual non-entity in this case.
Appellant’s Brief at 14.
In the alternative, Appellant argues:
____________________________________________
3It is undisputed that Brian Brossman was unavailable because he died on
November 12, 2016. See N.T., 11/6/18, at 16; Commonwealth Exhibit 2.
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Even if Mr. Brossman was the only witness that could substantiate
the conspiracy charge, Mr. Brossman had previously pleaded to a
crimen falsi offense (False Reports 18 Pa. C.S. 4906), and thus,
his word was questionable. His plea to a crimen falsi renders the
Commonwealth’s reliance upon his “statement” and “credible”
testimony are tenuous at best [sic]. There is simply no reason to
believe that he would have appeared to testify for the
Commonwealth, that he would have testified against the
Appellant, and that his testimony would have been reliable.
Appellant’s Brief at 15.
Contrary to both Appellant and the trial court, the Commonwealth
argues that Appellant did not meet the first prong of Carrasquillo and did not
raise a plausible defense of innocence. The Commonwealth states that even
if the court accepted Appellant’s explanation regarding the television, “it still
does not follow why other items from the household were taken.”
Commonwealth Brief at 12. With regard to the second prong, the
Commonwealth states that Mr. Brossman was a “material” and “independent”
witness, who would have testified to the necessary elements of the four crimes
with which Appellant was charged, and corroborate the testimony the victim,
Amy Burns. Id. at 9, 12-13. The Commonwealth asserts that it would be
substantially prejudiced by Mr. Brossman’s unavailability because although
Mr. Brossman is not the only Commonwealth witness, “the other witnesses
would not be as strong and compelling,” because “Mr. Brossman had nothing
to do with the theft.” Id. at 14.
Upon review, we discern no abuse of discretion in the trial court’s
determination that Appellant demonstrated a fair and just reason for the
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withdrawal of his plea. See Commonwealth v. Islas, 156 A.3d at 1292.
Noting the “policy of liberality” articulated in Carrasquillo, the trial court
concluded that Appellant provided the court with “more than just a bare
assertion of innocence.” Trial Court Opinion, 9/13/19, at 7. The trial court
referenced Appellant’s post-hearing memorandum in support of his motion to
withdraw plea, in which he reiterated that he did not steal the television, and
claimed that it was given to him by Ms. Burns. See Memorandum in Support
of Guilty Plea, 1/24/19, at 7. Appellant further stated that he:
has affirmed his innocence on multiple occasions – in his initial
statement to the [police] officer, in multiple statements to th[e]
honorable [trial] court, and lastly, in his testimony at the hearing
on his motion to withdraw his plea.
Id. at 8.
Upon review, and mindful that “the proper inquiry on consideration of
such a withdrawal motion is whether the accused has made some colorable
demonstration, under the circumstances,” we do not disturb the trial court’s
finding that Appellant demonstrated a fair and just reason in support of his
motion to withdraw guilty plea. See Commonwealth v. Carrasquillo, 115
A.3d at 1292. We therefore turn to the second consideration of whether the
Commonwealth would be substantially prejudiced by withdrawal of the plea.
Id. (citing Commonwealth v. Forbes, 299 A.2d 268,271 (Pa. 1973)).
Again, we are not persuaded that the trial court abused its discretion.
The trial court stated that it found the Commonwealth’s contentions of
prejudice to be “compelling and credible,” while Appellant’s claims regarding
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Mr. Brossman failed to “squarely address nor refute the Commonwealth’s
contentions.” Trial Court Opinion, 9/13/19, at 10.
The Commonwealth presented three witnesses at the hearing on
Appellant’s withdrawal motion. First, Lansford Police Detective Joshua Tom
testified that the victim, Amy Burns, told him that she met Appellant at Mr.
Brossman’s house. N.T., 11/6/19, at 19. Detective Tom confirmed Appellant’s
statement that he was “holding” Ms. Burns’ television as collateral. Id. at 23.
However, Detective Tom stated that Mr. Brossman told Detective Tom that
Appellant and two other individuals were at Mr. Brossman’s home “the day of
the burglary” and verbalized their “plan on burglarizing the victim’s home.”
Id. at 24. Detective Tom opined that Mr. Brossman was “a mutual party,
[but] didn’t really want much to be involved with it.” Id. at 25. He stated,
“[Brian Brossman] was the neutral party between Amy Burns and
[Appellant].” Id. (emphasis added). Detective Tom continued:
Brian [Brossman] stated that after the three, [Appellant],
[Felicia] Urbanski and [Charles] Grant came up with their plan,
they executed the plan, left the house, then came back to Brian’s
house and wanted him to hold some of the stuff. He told them he
wanted no part of it and told them to leave.
Id.
Detective Tom stated that Mr. Brossman “did not give a written
statement. This was all during a [verbal] interview.” Id. at 26. On cross-
examination, Detective Tom testified that he never offered Mr. Brossman the
opportunity to be recorded, and as to a written statement, Mr. Brossman “was
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J-S71028-19
not one for writing things down.” Id. at 49. The detective averred that Mr.
Brossman “just overheard them that they were planning on burglarizing the
house. That was [sic] his words.” Id. at 50. He repeated: “He told me that
they were all in the living room planning on breaking in and burglarizing Amy
Burns’ house.” Id. Defense counsel cross-examined Detective Tom as
follows:
Q. Okay. So is it safe to say that Mr. Brossman told you, he
doesn’t know what happened that morning one way or the other,
or that day at Amy Burns’ house, fair enough?
A. The only thing I can testify to is that he overheard them
planning on breaking into the house. They left and they returned
with a bunch of stuff asking to keep it at Brian’s house and he
said; no, you’ve got to leave.
Q. The stuff, the bunch of stuff, did he provide you an
inventory, much like Mr. Burns did?
A. No, he did not.
Q. He didn’t write anything down?
A. He didn’t write anything down. He didn’t want to know
nothing about it. They offered; can we keep this stuff here? And
he said; no, you’ve got to leave.
Q. Okay.
A. And they left. He didn’t want no part of their plan.
Q. But he wasn’t present one way or the other when the stuff
was taken from Amy Burns’ house?
A. No, not that I’m aware of. He did not say that.
Q. He tells you that he overheard their statement?
[COMMONWEALTH]: Asked and answered.
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[DEFENSE COUNSEL]: That’s what this witness said. I didn’t ask
– I asked him what he heard, but I want to get—
THE COURT: You just asked him.
[DEFENSE COUNSEL]: So he overhears it. Did he tell you how
far away he was standing when he overheard it?
A. No.
Q. Did he tell you that he was part of the conversation when
he overheard it?
A. Nope.
Q. So according – he didn’t tell you or give you any more details
other than he overheard them planning the burglary?
A. He said that they were sitting in the room and they were
talking about breaking in and burglarizing Amy Burns’ house.
N.T., 11/6/18, at 52-53.
Prior to calling the next witness, Felicia Urbanski, the Commonwealth
addressed the trial court:
I had anticipated having Felicia Urbanski here to testify similarly
to Mr. Brossman since she apparently was there. [But] in my
discussion with her, Ms. Urbanski will be testifying contrary to Mr.
Brossman.
The reason why I bring that up, Your Honor, is if she would
have been able to testify in accordance with Mr. Brossman,
then I would have been able to interchange her with Mr.
Brossman for trial. At this point in time, I have a witness who
will not be testifying in accordance with Mr. Brossman.
Id. at 66 (emphasis added).
As indicated by the Commonwealth, Ms. Urbanski’s testimony was
contrary to Detective Tom’s account of what Mr. Brossman said. Ms. Urbanski
testified:
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We were at Brian’s house that morning and Amy – it was almost
around afternoon time and she was supposed to get money from
her husband. So she was going to get money from her husband
to give [Appellant]. There would be no reason to burglarize her
house. She was gone for about an hour. [Appellant] left Brian’s
house. [Appellant] came back to Brian’s house with the TV in the
back of the car.
N.T., 11/6/18, at 73.
After Ms. Urbanski, the Commonwealth called Amy Burns, who testified
unequivocally that her home was burglarized. Although Ms. Burns admitted
to being “fronted” drugs from Appellant, she denied “any arrangements” with
Appellant to provide personal items as collateral. Id. at 79-93. For example,
Ms. Burns testified, “If I wanted to give [Appellant] the television for collateral,
I could have done it myself. I wouldn’t have told a stranger to go into my
home.” Id. at 89. She said she “never told [Appellant] to go into my home
without me being present.” Id. She added that she knew Felicia Urbanski,
and “Lansford is a small town. Everyone knows where my house is.” Id.
On this record — i.e., the testimony presented at the hearing on
Appellant’s motion to withdraw guilty plea — we discern no abuse of discretion
by the trial court in determining that the Commonwealth would be
substantially prejudiced by Appellant’s withdrawal of his plea. We have
explained that a defendant is:
not entitled to withdraw his plea if, at the time of the motion, such
withdrawal would have “substantially prejudiced” the
Commonwealth. . . .
***
- 10 -
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In assessing a claim of substantial prejudice, we focus on whether
there was a material change in circumstances between a
defendant’s guilty plea and his motion to withdraw. In other
words, the question before us is whether, at the time [the
defendant] moved to withdraw his plea, the prosecution would
have been substantially prejudiced by being required to try its
case.
Commonwealth v. Islas, 156 A.3d 1185, 1192-94 (Pa. Super. 2017)
(citations omitted and footnote).
Here, Appellant filed his motion to withdraw guilty plea on May 17, 2018,
after the Commonwealth’s witness, Mr. Brossman, had died. Thus, there was
a material change in circumstances. Citing Commonwealth v. Scher, 803
A.2d 1204 (Pa. 2002), Appellant states that “[t]he Pennsylvania Supreme
court has held that the death of a potential witness does not automatically
constitute prejudice.” Appellant’s Brief at 23. However, Scher does not
involve a guilty plea; rather, the defendant in Scher made a claim regarding
his due process rights relative to a 20-year delay in being charged with
murder. We are more persuaded by the cases Appellant cites which involve a
defendant’s desire to withdraw a pre-sentence plea. Appellant recognizes:
It is settled law that “prejudice,” in the withdrawal of a guilty plea
context, requires a showing that, due to events occurring after the
plea was entered, the Commonwealth is placed in a worse position
than it would have been had trial taken place as scheduled.
Commonwealth v. Kirsch, 930 A.2d 1282, 1286 (Pa. Super.
2007). See also Commonwealth v. Prendes, 97 A.3d 337, 353
(Pa. Super. 2014). Generally speaking, “prejudice would require a
showing that due to events occurring after the plea was entered,
the Commonwealth is placed in a worse position than it would
have been had trial taken place as scheduled.” Commonwealth
v. Kirsch, 930 A.2d 1282, 1286 (Pa. Super. 2007); appeal denied,
596 Pa. 727, 945 A.2d 168 (2008). When a guilty plea is
- 11 -
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withdrawn before sentencing, the withdrawal usually does not
substantially prejudice the Commonwealth if it simply places the
parties “back in the pretrial stage of proceedings.” Id.
Appellant’s Brief at 21-22.
Upon review, we find no error in the trial court’s determination that the
Commonwealth would be prejudiced by Mr. Brossman’s unavailability. We
agree with the Commonwealth that had the trial occurred as scheduled, Mr.
Brossman would be the “most strong and compelling witness,” given that he
was the most independent, could have testified to the elements of the crimes
with which Appellant was charged, and corroborated the testimony of Amy
Burns. See Commonwealth Brief at 13-14. To the extent Appellant argues
that Mr. Brossman lacked credibility because he pled guilty to a crimen falsi
offense, we note the trial court’s discretionary authority when such matters
arise at trial. See, e.g., Commonwealth v. Hoover, 107 A.3d 723 (Pa.
2014). In sum, the evidence supports the trial court’s finding that the
Commonwealth would be placed in a worse position, and therefore
substantially prejudiced, if Appellant was permitted to withdraw his plea.
Judgment of sentence affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/8/20
- 12 - | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523612/ | J. S14031/20
NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P. 65.37
S.O., : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
v. : No. 2871 EDA 2019
:
D.W. AND F.W. :
Appeal from the Order Entered September 11, 2019,
in the Court of Common Pleas of Delaware County
Civil Division at No. CV-2018-001256
BEFORE: BOWES, J., KING, J., AND FORD ELLIOTT, P.J.E.
MEMORANDUM BY FORD ELLIOTT, P.J.E.: FILED APRIL 08, 2020
S.O. appeals from the September 11, 2019 order entered in the Court
of Common Pleas of Delaware County that denied her emergency petition for
legal and physical custody of J.W., female child born in March 2008
(the “Child”), for want of standing. We affirm.
The trial court set forth the following:
After the filing of an Emergency Custody Petition in
this matter, the [trial] court ordered an investigation
by Delaware County Children and Youth Services
(CYS). As a result of the investigation, at a hearing
held October 4, 2018, the court barred [appellant]
from having any contact with [the Child].
At the [trial] court’s March 27, 2019 hearing on
[a]ppellant’s standing to pursue legal and physical
custody of the [Child], the [trial] court heard
testimony from Ms. Maura Gray, a supervisor at CYS.
Ms. Gray had conducted a forensic interview of [the
Child] and determined that it “was not in [the Child’s]
J. S14031/20
best interest to see [appellant].” There was concern
regarding the relationship between [the Child and
appellant] because [appellant] had taken the [C]hild
on trips to Florida without her parents’ knowledge. In
addition, [the Child] reported that she would often go
to one of [appellant’s] friend’s home[s] who was
subsequently convicted of sexual abuse of children.
[The Child] would have sleepovers there. The friend
had a daughter [the Child’s] age. [The Child] did not
report any abuse that occurred in the home. In
addition, [the Child] reported that she often slept with
[appellant] and missed cuddling with her. Ms. Gray
testified: “. . . it was, you know a little bit alarming
coming from a 10-year-old. . . [.]” It was also placed
on the record that there was a letter sent to the [trial]
court in September of 2018 indicating that [appellant]
had made a statement to a police officer in response
to something that he told her regarding the [C]hild
stating, “I guess this is why people kidnap kids.”
[D.W. (“Mother”) and F.W. (“Father”)] are married
and reside [in] Delaware County, Pennsylvania. They
are the parents of six children all of whom currently
live with them. [The Child] is the fourth of their
six children. [The Child] was born [in] March [of]
2008 and is currently 11 years old and in the
fifth grade. The family moved to [their current
residence with Mother’s mother] when [the Child] was
approximately one year old.
At the time of the June 5, 2019 hearing in this matter,
[a]ppellant testified that she was the 28-year-old
neighbor of [Mother and Father]. Appellant’s
residence had three bedrooms and the residents
included her mother, her sister, and herself. There
was no designated bedroom for [the Child] but there
was a finished basement with designated space for
[the Child]. Appellant testified: “she would sleep with
me often at nights, but she did have her own bed.”
At the June evidentiary hearing, there were significant
differences between the parties’ testimony on many
issues including the length of time that [the Child]
stayed with [a]ppellant. Appellant testified that in the
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beginning, “[I]t was more so they asked me to take
her to help them out. It wasn’t like can you take her
for this amount of time or that amount of time.” The
parties had vastly different testimony as to the length
of time [appellant] cared for [the Child]. [Mother]
testified that [appellant] overestimated the time [the
Child] stayed with [appellant].
[Mother] testified that although [appellant] was
buying school supplies and school clothes for [the
Child,] there was no need for her to do so because
[Mother] always had supplies and clothing for her at
her home. [The Child] “wanted to use the pretty frilly
things that [appellant] bought her and not the stuff
that [Mother] bought her or she would use both.”
[Father] testified that he attended almost all of [the
Child’s] doctors’ appointments, from the time that
[the Child] was 4-9 years old. When [Father] was
asked whether over the years, that [the Child] stayed
and lived with [appellant] was that with his
permission, he responded “No.” He testified that he
and [Mother] scheduled doctor and dentist
appointments and then permitted [appellant] to take
[the Child] to the doctor visits. When asked on
cross-examination whether [appellant] was acting in
a parental role, he responded: “[N]o, I seen [sic] it
as a friend, I didn’t -- we were her parents. I did not
expect or see any of that coming my way. No, I did
not.”
[Appellant] testified at length as to the close
relationship she had with [the Child]. She testified on
direct that she financially supported the [C]hild. On
cross-examination, she testified that the only request
for monies she made of [Mother and Father] was for
reimbursement of camp. In direct testimony,
[appellant] testified that the doctors of CHOP knew
her to be the [C]hild’s parent. On cross-examination,
[appellant] testified that they knew she was a family
friend. [Appellant] testified that she never had a
physical health insurance card for [the Child] but she
had a picture of the card. [Appellant] testified that
[the Child] “would sleep with me often at nights, but
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she did have her own bed . . . [s]he would be scared
to sleep by herself, having bad dreams or scared.”
[Appellant] testified that [the Child] slept with her in
the same bed until she was nine years old.
Trial court opinion, 11/25/19 at 2-5 (record citations omitted; some brackets
in original).
On September 11, 2019, the trial court entered the order denying
appellant’s emergency petition for legal and physical custody of the Child for
want of standing. Appellant filed a timely notice of appeal on October 4, 2019,
but failed to simultaneously file and serve a concise statement of errors
complained of on appeal as required by Pa.R.A.P. 1925(a)(2)(i). See
Pa.R.A.P. 1925(a)(2)(i) (requiring concise statement be filed and served with
notice of appeal in children’s fast track appeals). On October 9, 2019, the
trial court then ordered appellant to file a concise statement. Appellant filed
her concise statement on October 23, 2019. The trial court then filed an
opinion.
At the outset, we note that this court has recognized that the failure to
file a Rule 1925(a)(2)(i) concise statement contemporaneously with the notice
of appeal constitutes a defective notice of appeal to be disposed of on a
case-by-case basis. In re K.T.E.L., 983 A.2d 745, 747 (Pa.Super. 2009).
Where there has been substantial compliance with the rules and where there
is no allegation of prejudice, dismissal is not appropriate. See id. Here,
despite filing a defective notice of appeal, appellant has substantially complied
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with the rules. Additionally, Mother and Father do not allege prejudice.
Therefore, we will not dismiss this appeal
Appellant raises the following issue for our review:
Did the trial court abuse its discretion and err as a
matter of law in determining that there was
insufficient evidence or that the evidence presented at
the hearing on June 5, 2019 was not clear and
convincing to establish in loco parentis standing for
[a]ppellant, pursuant to 23 Pa.[C.S.A.] § 5324(2)[?]
Appellant’s brief at 3.
Threshold issues of standing are questions of law;
thus, our standard of review is de novo and our scope
of review is plenary. K.W. v. S.L., 157 A.3d 498, 504
(Pa. Super. 2017). The concept of standing is vital in
ensuring that cases are presented to the court by an
individual who has a genuine, and not merely a
theoretical, interest in the matter. Thus, the
traditional test for standing is that the proponent of
the action must have a direct, substantial and
immediate interest in the matter at hand. D.G. v.
D.B., 91 A.3d 706 (Pa. Super. 2014). In M.W. v.
S.T., 196 A.3d 1065 (Pa. Super. 2018), our Court
emphasized:
In the area of child custody, principles of
standing have been applied with particular
scrupulousness because they serve a dual
purpose: not only to protect the interest
of the court system by assuring that
actions are litigated by appropriate
parties, but also to prevent intrusion into
the protected domain of the family by
those who are merely strangers, however
well-meaning.
Id. at 1069 (citation omitted).
M.S. v. J.D., 215 A.3d 295, 598 (Pa.Super. 2019) (parallel citations omitted).
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J. S14031/20
“Generally, the Child Custody Act does not permit third parties to seek
custody of a child contrary to the wishes of that child’s parents.” Id. at
598-599. The Act, however, permits certain individuals to file a custody
action, including “[a] person who stands in loco parentis to the child.”
23 Pa.C.S.A. § 5324(2). Our supreme court has explained that:
In loco parentis is a legal status and proof of
essential facts is required to support a conclusion that
such a relationship exists. . . .
The phrase “in loco parentis” refers to a person who
puts oneself in the situation of a lawful parent by
assuming the obligations incident to the parental
relationship without going through the formality of a
legal adoption. The status of in loco parentis
embodies two ideas; first, the assumption of a
parental status, and second, the discharge of parental
duties. The rights and liabilities arising out of an
in loco parentis relationship are, as the words imply,
exactly the same as between parent and child. The
third party in this type of relationship, however, can
not place himself in loco parentis in defiance of the
parents’ wishes and the parent/child relationship.
C.G. v. J.H., 193 A.3d 891, 907 (Pa. 2018), quoting T.B. v. L.R.M., 786 A.2d
913, 916-917 (Pa. 2001).
In T.B., our Supreme Court instructed:
The scope of review applied by an
appellate court to a child custody order is
of the broadest type; the appellate court
is not bound by the deductions or
inferences made by the trial court from its
findings of fact, nor must the reviewing
court accept a finding that is not
supported by competent evidence.
However, this broad scope of review does
not vest an appellate court with the duty
-6-
J. S14031/20
or privilege of making its own
independent determination. An appellate
court may not interfere with the trial
court’s factual conclusions unless they are
unreasonable in view of the trial court’s
factual findings and thus represent an
abuse of discretion.
786 A.2d at 916 (citations omitted). This scope of
review applies to trial court decisions regarding
standing. See id.; J.F. v. D.B., 897 A.2d 1261, 1273
(Pa.Super.), appeal denied, 909 A.2d 1290 (Pa.
2006); see also Silfies v. Webster, 713 A.2d 639,
642 (Pa.Super. 1998); J.A.L., 682 A.2d at 1318. In
this connection, we note that, “[o]n factual matters,
the hearing judge is far better able to assess
credibility and weight of testimony than” an appellate
court. Reilly v. Reilly, 280 A.2d 639, 640 (Pa Super.
1971). “[T]he ultimate test is ‘whether the trial
court’s conclusions are unreasonable as shown by the
evidence of record.’” Silfies, 713 A.2d at 642
(quoting Moore v. Moore, 634 A.2d 163, 168 n.4 (Pa.
1993)).
C.G. v. J.H., 172 A.3d 43, 52 (Pa.Super. 2017) (parallel citations omitted).
Here, appellant claims that the trial court “disregarded testimony and
evidence presented at the hearing” and “selected discrete portions of
testimony” to conclude that she lacked standing. (Appellant’s brief at 6-7.)
Appellant then sets forth her selected discrete portions of testimony in an
effort to persuade this court to reach a different result. We decline to do so.
It was for the trial court to assess credibility and weigh the evidence.
See C.G., 172 A.3d at 52. In its opinion, the trial court stated that the
testimony of the parties conflicted and it found that Mother and Father testified
credibly. (Trial court opinion, 11/25/19 at 10-12.) Our review of the record
-7-
J. S14031/20
demonstrates that the trial court’s conclusions are reasonable as shown by
the evidence of record.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 4/8/20
-8- | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523622/ | Case: 19-60548 Document: 00515375391 Page: 1 Date Filed: 04/08/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 19-60548
FILED
April 8, 2020
Summary Calendar
Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee
v.
REBA DALE MOODY,
Defendant-Appellant
Appeal from the United States District Court
for the Southern District of Mississippi
USDC No. 3:16-CR-90-1
Before HIGGINBOTHAM, HO, and ENGELHARDT, Circuit Judges.
PER CURIAM: *
Reba Dale Moody appeals the within-guideline sentence imposed on
revocation of her supervised release. She contends that her sentence is plainly
unreasonable because the district court sentenced her to a term of
imprisonment rather than long-term drug treatment.
We review a revocation sentence under the “plainly unreasonable”
standard. United States v. Miller, 634 F.3d 841, 843 (5th Cir. 2011). Moody
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
Case: 19-60548 Document: 00515375391 Page: 2 Date Filed: 04/08/2020
No. 19-60548
has challenged only the substantive reasonableness of her sentence. We
review the substantive reasonableness of her sentence for an abuse of
discretion, examining the totality of the circumstances. See United States v.
Warren, 720 F.3d 321, 326, 332 (5th Cir. 2013). A revocation sentence is
substantively unreasonable where the district court did not account for a factor
that should have received significant weight, gave significant weight to an
irrelevant or improper factor, or made a clear error in judgment when
balancing the sentencing factors. Id. at 332.
Moody’s contention that the district court improperly considered the
need to solve the problem of her addiction and failed to consider the nature and
circumstances of her offense is unavailing. The record reflects that the district
court considered Moody’s arguments that her best chance at recovery was long-
term treatment but determined that under the applicable 18 U.S.C. § 3553(a)
factors, a term of imprisonment was appropriate. Under the totality of the
circumstances, Moody has not shown that the district court clearly erred with
respect to the weight it gave to her personal history and characteristics, the
need to deter her, and the need to sentence her to time in prison. See id. at
331–33.
Any suggestion by Moody that the district court impermissibly
considered the need to punish her for her addiction and that the prison term
ran afoul of Tapia v. United States, 564 U.S. 319 (2011) is belied by the record.
Further, Moody’s complaint that the district court failed to avoid unwarranted
sentence disparities among defendants is conclusory and unsupported. See
United States v. Smith, 440 F.3d 704, 709 (5th Cir. 2006).
AFFIRMED.
2 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523621/ | PRECEDENTIAL
GCO-002-E
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 20-1033
_____________
UNITED STATES OF AMERICA,
Appellant
v.
FRANCIS RAIA
__________________
On Appeal from the United States District Court
for the District of New Jersey
District Court No. 2-18-cr-00657
District Judge: The Honorable William J. Martini
__________________
Before: SMITH, Chief Judge, AMBRO and
CHAGARES, Circuit Judges.
(Filed: April 2, 2020)
Mark E. Coyne
Steven G. Sanders
Office of United States Attorney
970 Broad Street
Room 700
Newark, NJ 07102
Counsel for Appellant
Jenny Chung
Lee Vartan
Chiesa Shahinian & Giantomasi
One Boland Drive
West Orange, NJ 07052
David M. Dugan
Chiesa Shahinian Giantomasi
11 Times Square
31st Floor
New York, NY 10036
Alan L. Zegas
Law Offices of Alan L. Zegas
Third Floor West
60 Morris Turnpike
Summit, NJ 07901
Counsel for Appellee
2
_______________
OPINION OF THE COURT
________________
SMITH, Chief Judge.
The First Step Act empowers criminal defendants to
request compassionate release for “extraordinary and
compelling reasons.” 18 U.S.C § 3582(c)(1)(A)(i).1 But
1
The relevant portion of § 3582 provides:
(c) MODIFICATION OF AN IMPOSED TERM OF
IMPRISONMENT.–The court may not modify a
term of imprisonment once it has been
imposed except that—
(1) in any case–
(A) the court, upon motion of the
Director of the Bureau of Prisons, or
upon motion of the defendant after the
defendant has fully exhausted all
administrative rights to appeal a failure
of the Bureau of Prisons to bring a
motion on the defendant’s behalf or the
lapse of 30 days from the receipt of
such a request by the warden of the
defendant’s facility, whichever is
earlier, may reduce the term of
3
before they make such requests, defendants must at least
ask the Bureau of Prisons (BOP) to do so on their behalf
and give BOP thirty days to respond. See § 3582(c)(1)(A).
And even then, defendants must first submit their motion
to “the [sentencing] court”; we can only consider these
motions on appeal. § 3582.
Nevertheless, Francis Raia asks us to decide his
compassionate-release motion in the first instance.
Alternatively, he asks us to dismiss the government’s
pending appeal so the District Court can decide the
motion. But although he asked BOP to move for
compassionate release on his behalf, he did not give it
thirty days to respond. So we will deny Raia’s motion.
I
While running for local office in Hoboken, New Jersey,
Raia directed campaign volunteers to bribe voters with
$50 payments to vote for him by absentee ballot and
support a measure he favored. A jury convicted Raia of
imprisonment (and may impose a term
of probation or supervised release with
or without conditions that does not
exceed the unserved portion of the
original term of imprisonment), after
considering the factors set forth in
section 3553(a) to the extent that they
are applicable, if it finds that—
(i) extraordinary and compelling
reasons warrant such a reduction
4
conspiring to use the mails to promote unlawful activity in
violation of 18 U.S.C. § 371. See also 18 U.S.C.
§ 1952(b)(i)(2) (defining “unlawful activity” to include
bribery). The District Court sentenced Raia to three
months imprisonment, one year of supervised release, and
a $50,000 fine. But the government thought the sentence
was too lenient, having originally sought twenty-seven
months imprisonment. It appealed to this Court under 18
U.S.C. § 3742(b).
On March 3, 2020, with the government’s appeal
pending, Raia reported to the federal correctional institute
in Fairton, New Jersey to begin his sentence. Shortly
thereafter, he asked BOP to move for compassionate
release on his behalf. But before BOP responded, and
before thirty days passed, Raia filed his own motion with
the District Court for compassionate release given the
present pandemic caused by COVID-19, a highly
contagious respiratory virus which has already infected
over 25,000 people in New Jersey and poses unique risks
in population-dense prison facilities. See Federal Bureau
of Prisons, COVID-19 Action Plan (Mar. 13, 2020, 3:09
PM), https://www.bop.gov/resources/news/20200313_
covid-19.jsp; New Jersey, COVID-19 Information Hub,
https://covid19.nj.gov/ (last updated Apr. 2, 2020, 1:00
PM). In particular, Raia claimed he faces heightened risk
of serious illness or death from the virus since he is sixty-
eight-years old and suffers from Parkinson’s Disease,
diabetes, and heart issues.
5
Two days later, the District Court denied the motion,
concluding that the pending appeal divested it of
jurisdiction. In a footnote, however, the District Court
offered that it would have granted the motion and released
Raia to home confinement “[d]ue to the increased risk
posed by a custodial term” in light of COVID-19, and
because Raia’s offense “was non-violent and [Raia] has
otherwise been a highly productive, charitable member of
his community.” Order n.1, Mar. 26, 2020 (ECF No. 86).
Raia has not appealed that order. Instead, he filed a
motion asking this Court to decide his compassionate-
release motion. Alternatively, he asks us to return
jurisdiction to the District Court by dismissing the
government’s appeal without prejudice. He claims we
have power to do so under Federal Rule of Appellate
Procedure 3(a)(2), which notes: “An appellant’s failure to
take any step other than the timely filing of a notice of
appeal does not affect the validity of the appeal, but is
ground only for the court of appeals to act as it considers
appropriate, including dismissing the appeal.”
II
We cannot decide Raia’s compassionate-release
motion in the first instance. Section 3582’s text requires
those motions to be addressed to the sentencing court, a
point several Circuits have noted and Raia himself
acknowledges. See, e.g., United States v. Richardson, 948
F.3d 733, 749 (6th Cir. 2020); United States v. Smith, 896
F.3d 466, 473 (D.C. Cir. 2018); Mot. 3.
6
Nor can we dismiss the government’s appeal under
Rule 3(a)(2). Rule 3(a)(2) dismissal is a sanction for
“fail[ing] to comply with procedural rules.” Horner Equip.
Int’l, Inc. v. Seaside Pool Ctr., Inc., 884 F.2d 89, 93 (3d
Cir. 1989); see also Lehman Bros. Holdings v. Gateway
Funding Diversified Mortg. Servs., L.P., 785 F.3d 96, 101
(3d Cir. 2015). Here, there is nothing the government has
failed to do.
We could, however, remand the case to the District
Court while retaining jurisdiction over the government’s
appeal under Rule 12.1. That would allow the District
Court to consider Raia’s compassionate-release request in
the first instance.
But any remand would be futile. As noted, Raia failed
to comply with § 3582(c)(1)(A)’s exhaustion requirement:
BOP has not had thirty days to consider Raia’s request to
move for compassionate release on his behalf, and there
has been no adverse decision by BOP for Raia to
administratively exhaust within that time period (as such,
we need not address administrative appeals here).
Although the District Court’s indicative ruling did not
mention the exhaustion requirement, it presents a glaring
roadblock foreclosing compassionate release at this point.
Accordingly, since Rule 3(a)(2) is inapt and since
remanding the matter under Rule 12.1 would be futile, we
will deny Raia’s motion outright.
* * *
7
We do not mean to minimize the risks that COVID-19
poses in the federal prison system, particularly for inmates
like Raia. But the mere existence of COVID-19 in society
and the possibility that it may spread to a particular prison
alone cannot independently justify compassionate release,
especially considering BOP’s statutory role, and its
extensive and professional efforts to curtail the virus’s
spread. See generally Federal Bureau of Prisons, COVID-
19 Action Plan (Mar. 13, 2020, 3:09 PM),
https://www.bop.gov/resources/news/20200313_covid-
19.jsp. Given BOP’s shared desire for a safe and healthy
prison environment, we conclude that strict compliance
with § 3582(c)(1)(A)’s exhaustion requirement takes on
added—and critical—importance. And given the Attorney
General’s directive that BOP “prioritize the use of [its]
various statutory authorities to grant home confinement
for inmates seeking transfer in connection with the
ongoing COVID-19 pandemic,” we anticipate that the
statutory requirement will be speedily dispatched in cases
like this one. Memorandum from Attorney Gen. to Dir.,
Bureau of Prisons 1 (Mar. 26, 2020),
https://www.justice.gov/file/1262731/download. So we
will deny Raia’s motion.
8 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3396469/ | The decree herein appealed from is hereby reversed and remanded on the authority of Bechtol v. Lee, et al., this day filed. *Page 387
ELLIS, C.J., and WHITFIELD, BROWN, BUFORD and CHAPMAN, J.J., concur. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4523641/ | Filed 4/7/20
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
SECOND APPELLATE DISTRICT
DIVISION SEVEN
NAASON JOAQUIN GARCIA, B302119
Petitioner, (Los Angeles County
Super. Ct. No. BA475856)
v.
THE SUPERIOR COURT OF LOS
ANGELES COUNTY,
Respondent;
THE PEOPLE,
Real Party in Interest.
ORIGINAL PROCEEDINGS in mandate. William C. Ryan
and George Gonzales Lomeli, Judges. Petition granted.
Werksman Jackson & Quinn, Alan Jackson, Kelly C. Quinn,
and Caleb Mason for Petitioner Naason Joaquin Garcia.
No appearance for Respondent.
Xavier Becerra, Attorney General, Lance E. Winters, Chief
Assistant Attorney General, Jeffrey M. Laurence, Senior Assistant
Attorney General, Laurence K. Sullivan and Bridget Billeter,
Deputy Attorneys General, for Real Party in Interest.
_______________________
Petitioner Naason Joaquin Garcia, an in-custody defendant
on a no-bail hold, was arraigned on a multi-count felony complaint
in June 2019. At that time, he waived his right to a speedy
preliminary hearing. In July 2019, Garcia was arraigned on an
amended complaint that added three additional counts; however,
he did not waive the time limits for a preliminary hearing at that
arraignment. Following several continuances of his preliminary
hearing, Garcia moved for the dismissal of the amended complaint
and his release from custody. The superior court denied the
motion. In this petition for writ of mandate, Garcia argues his
motion to dismiss should have been granted because the failure
to hold a timely preliminary hearing violated the statutory time
requirements of Penal Code section 859b and his constitutional
right to a speedy trial. We conclude that, where an in-custody
defendant is arraigned on an amended complaint, section 859b
requires that the preliminary hearing be held within 10 court
days of that arraignment unless there is a personal time waiver
by the defendant or good cause for a continuance. Because the
preliminary hearing for Garcia was not held within the 10-day
period prescribed by section 859b and Garcia did not personally
waive his right to a preliminary hearing within that time period,
section 859b mandates dismissal of the amended complaint
against him. We therefore grant the petition.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
I. Defendants Are Arraigned on the Original Complaint
And Enter 10-Day and 60-Day Time Waivers
On June 4, 2019, the California Attorney General’s Office
filed a felony complaint against Garcia, Alondra Ocampo, and
2
Susana Medina Oaxaca (collectively, defendants).1 Garcia was
charged with one count of lewd act upon a child (Pen. Code,2
§ 288, subd. (c)(1)), two counts of conspiracy to commit human
trafficking (§ 182, subd. (a)(1)), three counts of forcible rape
(§ 261, subd. (a)(2)), one count of statutory rape (§ 261.5, subd.
(c)), four counts of forcible oral copulation (§ 287, subd. (c)(2)), two
counts of oral copulation (§ 287, subd. (b)(1)), and one count of
extortion (§ 518).
On June 21, 2019, Garcia, Ocampo, and Oaxaca were each
arraigned on the complaint and entered a plea of not guilty. At
that time, each of the defendants also waived their right to a
preliminary hearing within 10 court days and 60 calendar days
of the arraignment. The court calendared August 2, 2019 as the
date for setting the preliminary hearing. Bail was set at $50
million for Garcia, $25 million for Ocampo, and $125,000 for
Oaxaca.
II. Defendants Are Arraigned on the Amended
Complaint Without Entering New Time Waivers
On July 15, 2019, the Attorney General’s Office filed an
amended complaint that added three counts against Garcia for
possession of child pornography (§ 311.11, subd. (a)). On July 16,
2019, Garcia, Ocampo, and Oaxaca were each arraigned on the
amended complaint and entered not guilty pleas. The court
1 A fourth defendant, Azalea Rangel Melendez, also was
charged in the complaint, but she had not been apprehended
by the authorities at the time the complaint was filed.
2 Unless otherwise stated, all further statutory references
are to the Penal Code.
3
ordered that Garcia be held without bail, and set bail at $25
million for Ocampo.3 During a discussion about outstanding
discovery issues, the court noted that the next scheduled hearing
was set for August 2, 2019. Garcia’s counsel advised the court
that they were “comfortable waiting until August 2nd” for
Garcia’s pending discovery motion to be heard. Without
objection, the court ordered all three defendants back on
August 2, stating that date would be “zero of 30.” The court did
not ask the defendants to waive time, and none of them did so.
III. Defendants Enter Limited Time Waivers for the
Preliminary Hearing to be Held No Later Than
September 23, 2019
On August 2, 2019, all parties appeared in court before Los
Angeles Superior Court Judge Francis Bennett II. Given the
numerous pending motions filed by the parties, the court stated
that it was appropriate to find “a home for this case for all
purposes.” One pending motion referenced by the court was
Oaxaca’s motion to set the preliminary hearing “within the
current time period over co-defendant’s objection.” During a
discussion about scheduling, Oaxaca’s counsel informed the court
that Oaxaca was willing to “table that motion” and to “waive
time” if the preliminary hearing was set for August 23.4 Garcia’s
3 Oaxaca previously had been released from custody on a
$125,000 bond.
4 During this discussion, the court noted that the
“arraignment was [on] June 21st, 2019,” and that “60 days from
that date is August 20th, 2019.” There was no mention of the 10-
day and 60-day time waivers entered by each defendant at the
June 21 arraignment on the original complaint. Nor was there
any discussion of the July 16 arraignment on the amended
4
counsel confirmed that “[a]ll agree August 23rd works for all
parties.” The court then inquired: “So just so I understand,
there’s going to be an agreement for a time waiver from all
parties with regard to this matter; is that correct?” All defense
counsel answered in the affirmative.
After stating that August 23, 2019 would be the “zero of
30 date,” the court had the following exchange with Garcia:
The Court: Do you understand that you have a statutory
right to a speedy preliminary hearing, that is within 10 court
days and 60 calendar days of your arraignment. Do you
understand that?
Defendant Garcia: Yes, sir.
The Court: And, presently, it’s my understanding that
today is set for day zero of 30, which means that you would be
going to preliminary hearing within 30 days of today. Do you
agree to waive and give up those rights so that your matter
can be continued to the date of August 23rd, 2019, with the
understanding that your preliminary hearing would be held on
that date or within 30 calendar days of that date? Do you agree
to that?
Defendant Garcia: Yes, sir.
The court took the same 30-day time waivers from Ocampo and
Oaxaca.
complaint or the potential impact of that proceeding on the
statutory time limits for holding the preliminary hearing.
5
IV. The Preliminary Hearing Is Continued to a Date
After September 23, 2019 Due to the Parties’
Discovery Dispute
On August 23, 2019, all parties appeared in court before
Los Angeles Superior Court Judge Teresa Sullivan. During a
discussion about the pending discovery motions, the court asked
about the status of any outstanding discovery. In response to the
People’s representation that discovery was being provided to the
defense “on a rolling basis” because the investigation was
ongoing, the court warned that “the defendants have the right to
have their hearing with the evidence that the People have . . .
and if the People filed the case without the evidence that they
needed, that’s not the defendants’ burden to bear.” The court also
inquired if an agreement had been reached on a date for the
preliminary hearing. The People replied that defense counsel
could not agree on a date. Without objection, the court set the
preliminary hearing for September 19, 2019, and stated that date
would be “26 of 30.”5
On September 13, 2019, the court held a hearing to address
outstanding discovery issues. Defense counsel complained that
the People were failing to comply with their discovery obligations
by denying the defense proper access to the electronic devices
that were seized from the defendants pursuant to search
warrants and were currently being stored in Fresno, California.
The court ordered the People to provide the defense with full
5 The court initially indicated that the September 19 date
would be “28 of 30,” but then corrected this statement after
Oaxaca’s counsel noted the error.
6
access to all evidence in their possession on or before September
16, 2019.
On September 18, 2019, the parties returned to court over
a dispute about the People’s compliance with the discovery order.
Defense counsel asserted that, of the 61 electronic devices seized
from the defendants, the People were continuing to deny access to
18 devices. The court reiterated its prior order to the People “to
provide immediately to the defense all electronic evidence in your
possession.” The court also calendared “an order to show cause
[regarding] contempt before this court tomorrow should there not
be compliance once again.”
On September 19, 2019, the date set for the preliminary
hearing, the court found the People in contempt for their failure
to comply with its discovery order. The court issued monetary
sanctions against the two prosecuting attorneys. The court also
ordered the People to bring all physical evidence in its possession
to the courtroom the following day. The preliminary hearing was
trailed to September 20, 2019.
On September 20, 2019, the court found that the People
had complied with its order to bring all of the physical evidence
seized from the defendants to the courtroom that day. Based
on such compliance, the court granted the People’s motion for
reconsideration and withdrew the contempt finding and sanctions
order. The court also ordered that the preliminary hearing be
trailed to Monday, September 23, 2019, stating that was the
“ten-of-ten date.”6 Garcia’s counsel argued that the defense still
6 September 23, 2019 was actually the 30 of 30 date based on
the limited time waivers entered by each of the defendants at the
August 2, 2019 hearing.
7
did not have access to the substantive discovery because it was
going to take a considerable amount of time to review all of the
electronic data provided by the People that morning. In
response, the court stated: “I understand that you are
characterizing access a little differently, . . . and that has an
appropriate place in an appropriate time. Right now, the People
have complied with my order. The evidence is in front of me.
You guys have to figure this out.”
On September 23, 2019, all parties appeared for the
preliminary hearing before Los Angeles Superior Court Judge
George Lomeli. At the outset, Garcia’s counsel stated that Garcia
was “not in a position to make a readiness announcement, vis-a-
vis the preliminary hearing” due to “some ongoing outstanding
very significant discovery issues.” Garcia’s counsel then argued
that the People were still not complying with their discovery
obligations despite Judge Sullivan’s prior orders. While the
People asserted that Judge Sullivan had found them to be in full
compliance with her discovery order, Garcia’s counsel maintained
that Judge Sullivan merely had found compliance with her
contempt order and made no determination about discovery. The
court stated that it would need to review the transcript of the
September 20 hearing.
With respect to the preliminary hearing, the court asked
if Garcia was requesting a continuance based on his counsel’s
representation that they were not ready to proceed. In response,
Garcia’s counsel stated: “I want to make sure the record is very
clear. I did not make the representation that we’re not ready and
I’m not implying or asking for a continuance. No. My client is
sitting in jail on a no bail hold. He has a right to his legal and
constitutional preliminary hearing today. Period. And he is not
8
going to waive time and he is not asking for a continuance. He is
not asking for a delay. If this court were to find that there is an
issue that needs to be dealt with and needs to be discovered, then
I would ask the court to impose that order and let’s take it from
there, but he is not waiving time.” When the court inquired if
there had been any previous time waivers, the People replied
that there were “both 10 day and 60-day time waivers as to all
three defendants.” Citing People v. Love (2005) 132 Cal. App. 4th
276, the court stated that, once a waiver was made, it could not
be withdrawn under section 859b. The People advised the court
that they were ready to proceed with the preliminary hearing
that day. Garcia’s counsel, however, reiterated that he was “not
in a position to make a readiness announcement at this point.”
Ocampo’s counsel joined in the arguments of Garcia’s counsel and
stated that Ocampo was in the same position.
The court ordered that the preliminary hearing be
continued to September 26, 2019 so that it could review the
relevant transcripts to determine if the People had complied with
the prior discovery order. After confirming his availability on
that date, Garcia’s counsel stated: “I want to make sure . . . the
court understand that us agreeing to come back to a date certain
after today’s date is not an implicit or implied waiver by Mr.
Garcia . . . for purposes of his speedy trial rights either
statutorily under [section] 859b or constitutionally under the
California or United States Constitution.” Garcia’s counsel added
that “any continuance beyond today’s date would be over Mr.
Garcia’s objection.”
9
V. Defendants Move to Dismiss the Action Pursuant to
Section 859b
On September 25, 2019, Garcia and Ocampo filed a motion
to dismiss the action against them and to order their immediate
release from custody based on a violation of section 859b.7 They
argued that their statutory right to a preliminary hearing within
10 court days of their arraignment was violated because, when
they were arraigned on the amended complaint on July 16, 2019,
they did not enter any time waivers at that arraignment, and the
10-day period had expired. They further asserted that, even if
they had entered a subsequent time waiver on August 2, 2019,
that waiver was invalid because it was based on a promise that
they had a right to a preliminary hearing within 30 calendar
days of August 23, 2019, and that 30-day period also had expired.
On September 26, 2019, the court denied the motion to
dismiss. The court found that defendants had waived the 10-day
and 60-day time limits for the preliminary hearing at their
arraignment on the original complaint, and that the amendment
to the complaint did not trigger a new 10-day or 60-day period
under section 859b. The court also rejected the defendants’
argument that their subsequent 30-day waivers were invalid
because the preliminary hearing was not held on or before
September 23, 2019. The court noted that “the prosecution was
prepared to conduct the defendants’ preliminary hearing within
the 30-day time period” agreed to by the defendants; however, “as
defense counsel for all defendants represented to this court on the
7 Oaxaca joined her codefendants’ motion to dismiss, but did
not request the additional remedy of immediate release since she
was already out-of-custody on bail.
10
date of September 23, that being the 30 of 30 date, they were not
prepared to proceed . . . as they did not have sufficient discovery
produced by the prosecution so as to allow their ability to go
forward with the preliminary hearing.” The court found that
counsel’s representation that the defense required additional
preparation time to review all of the discovery was “an implicit
waiver by the defendants to proceed to preliminary hearing
within the required time period.” In addition, the court found
that, based on its review of the transcript from the September 20
hearing, the People were in compliance with the prior discovery
order, though the parties still needed to resolve certain details
regarding discovery. At the request of Garcia’s counsel, the court
ordered the proceedings stayed pending the defendants’ filing of a
writ petition.
VI. Garcia Files A Writ Petition In Superior Court
On October 7, 2019, Garcia filed a petition for writ of
mandate or prohibition in Los Angeles County Superior Court,
seeking dismissal of the amended complaint and immediate
release from custody. In his petition, Garcia raised the same
arguments regarding the alleged violation of his statutory right
to a timely preliminary hearing under section 859b. He also
asserted that the lengthy delay caused by the People’s lack of
compliance with discovery violated his right to a speedy trial
under the state and federal constitutions.
On October 22, 2019, Los Angeles Superior Court Judge
William Ryan denied Garcia’s writ petition. The court found that
Garcia waived the statutory time requirements for a preliminary
hearing at his arraignment on the original complaint, and that
section 859b did not contemplate that an arraignment or plea on
11
an amended complaint would trigger a new time period. The
court also found that Garcia failed to show a violation of his
constitutional right to a speedy trial because he provided valid
time waivers on both June 21, 2019 and August 2, 2019, and he
only thereafter asserted that he was unable to proceed despite
the People’s readiness announcement. The court reasoned that if
Garcia believed his prior waiver was made in error, “his failure to
object to that time waiver until the instant petition takes away
his right to object to that error.”
VII. Garcia Files The Instant Writ Petition
On November 12, 2019, Garcia petitioned this court for
a writ of mandate directing the superior court to dismiss the
amended complaint against him and to order his release from
custody. On November 26, 2019, after the People filed an
informal opposition to the writ petition, we issued an order to
show cause why the requested relief should not be granted. The
People filed a return to the order to show cause on December 17,
2019, and Garcia filed a reply on January 14, 2020.
DISCUSSION
In seeking writ relief, Garcia contends that his statutory
and constitutional rights to a timely preliminary hearing were
violated, requiring the dismissal of the amended complaint
and his release from custody. Garcia specifically asserts that,
under section 859b, his arraignment on the amended complaint
triggered a new statutory time limit for holding the preliminary
hearing, which he did not personally waive. Garcia also argues
that the failure to timely hold a preliminary hearing due to the
12
prosecution’s repeated discovery violations deprived him of his
constitutional right to a speedy trial.
I. Standard of Review
To determine whether section 859b mandates dismissal of
the amended complaint in this case, we must resolve a question
of statutory interpretation. “‘Our role in construing a statute is
to ascertain the intent of the Legislature so as to effectuate the
purpose of the law. [Citation.] Because the statutory language is
generally the most reliable indicator of that intent, we look first
at the words themselves, giving them their usual and ordinary
meaning. [Citation.] We do not, however, consider the statutory
language in isolation, but rather examine the entire substance of
the statute in order to determine the scope and purpose of the
provision, construing its words in context and harmonizing its
various parts. [Citation.]’ [Citation.]” (People v. Castillolopez
(2016) 63 Cal. 4th 322, 329; see also Satele v. Superior Court
(2019) 7 Cal. 5th 852, 858-859.) “‘If the statutory language is
unambiguous, then its plain meaning controls.’” (People v. Ruiz
(2018) 4 Cal. 5th 1100, 1106.) If, however, the language supports
more than one reasonable construction, “we look to other indicia
of legislative intent, bearing in mind the admonition that ‘[t]he
meaning of a statute may not be determined from a single word
or sentence’ [citation] and that apparent ‘ambiguities often may
be resolved by examining the context in which the language
appears and adopting the construction which best serves to
harmonize the statute internally and with related statutes.’
[Citations.]” (People v. Pennington (2017) 3 Cal. 5th 786, 795.)
“Essential is whether our interpretation, as well as the
consequences flowing therefrom, advances the Legislature’s
13
intended purpose. [Citation.]” (People v. Hubbard (2016) 63
Cal. 4th 378, 386.)
II. Overview of Section 859b
Section 859b “governs the time within which a preliminary
examination must be held.” (People v. Standish (2006) 38 Cal. 4th
858, 866.) In addition to establishing a statutory right of both the
People and the defendant to a preliminary hearing at the earliest
possible time (Ramos v. Superior Court (2007) 146 Cal. App. 4th
719, 727-728 (Ramos)), section 859b sets forth the time limits
for conducting a preliminary hearing in a felony case and the
consequences of failing to comply with those requirements
(People v. Figueroa (2017) 11 Cal. App. 5th 665, 673). First, “the
preliminary examination shall be held within 10 court days of
the date the defendant is arraigned or pleads, whichever occurs
later, or within 10 court days of the date criminal proceedings are
reinstated” following a mental competency determination, unless
both the defendant and the prosecution “waive that right or good
cause for a continuance is found.” (§859b.) Second, whenever the
defendant is in custody for 10 or more court days on the pending
complaint, “the magistrate shall dismiss the complaint if the
preliminary examination is set or continued beyond 10 court
days from the time of the arraignment, plea, or reinstatement of
criminal proceedings” unless (a) “the defendant personally waives
his or her right to preliminary examination within the 10 court
days,” or (b) “[t]he prosecution establishes good cause for a
continuance beyond the 10-court-day period.” (Ibid.) Third,
regardless of whether the defendant is in custody, “[t]he
magistrate shall dismiss the complaint if the preliminary
examination is set or continued more than 60 days from the
14
date of the arraignment, plea, or reinstatement of criminal
proceedings . . . unless the defendant personally waives his or her
right to a preliminary examination within the 60 days.” (Ibid.)8
8 Section 859b states in full: “At the time the defendant
appears before the magistrate for arraignment, if the public
offense is a felony to which the defendant has not pleaded guilty
in accordance with Section 859a, the magistrate, immediately
upon the appearance of counsel, or if none appears, after waiting
a reasonable time therefor as provided in Section 859, shall set
a time for the examination of the case and shall allow not less
than two days, excluding Sundays and holidays, for the district
attorney and the defendant to prepare for the examination. The
magistrate shall also issue subpoenas, duly subscribed, for
witnesses within the state, required either by the prosecution or
the defense. [¶] Both the defendant and the people have the right
to a preliminary examination at the earliest possible time, and
unless both waive that right or good cause for a continuance
is found as provided for in Section 1050, the preliminary
examination shall be held within 10 court days of the date the
defendant is arraigned or pleads, whichever occurs later, or
within 10 court days of the date criminal proceedings are
reinstated pursuant to Chapter 6 (commencing with Section
1367) of Title 10 of Part 2. [¶] Whenever the defendant is in
custody, the magistrate shall dismiss the complaint if the
preliminary examination is set or continued beyond 10 court
days from the time of the arraignment, plea, or reinstatement
of criminal proceedings pursuant to Chapter 6 (commencing
with Section 1367) of Title 10 of Part 2, and the defendant has
remained in custody for 10 or more court days solely on that
complaint, unless either of the following occur: [¶] (a) The
defendant personally waives his or her right to preliminary
examination within the 10 court days. [¶] (b) The prosecution
establishes good cause for a continuance beyond the 10-court-
day period. [¶] For purposes of this subdivision, “good cause”
includes, but is not limited to, those cases involving allegations
that a violation of one or more of the sections specified in
15
As the California Supreme Court has explained, “[t]he
language of section 859b is ‘plain and mandatory’ and creates
an ‘absolute right in favor of persons in custody charged with
felonies to have the preliminary examination commenced within
10 court days . . . .’ [Citation.]” (Landrum v. Superior Court
(1981) 30 Cal. 3d 1, 6, fn. omitted.) Accordingly, “the magistrate
is required to dismiss the complaint if the court fails to adhere to
the mandatory 10-court-day rule for incarcerated defendants or
the 60-day rule for all defendants.” (People v. Figueroa, supra, 11
Cal.App.5th at p. 674; see People v. Standish, supra, 38 Cal.4th
subdivision (a) of Section 11165.1 or in Section 11165.6 has
occurred and the prosecuting attorney assigned to the case has
another trial, preliminary hearing, or motion to suppress in
progress in that court or another court. Any continuance under
this paragraph shall be limited to a maximum of three additional
court days. [¶] If the preliminary examination is set or continued
beyond the 10-court-day period, the defendant shall be released
pursuant to Section 1318 unless: [¶] (1) The defendant requests
the setting of continuance of the preliminary examination beyond
the 10-court-day period. [¶] (2) The defendant is charged with
a capital offense in a cause where the proof is evident and
the presumption great. [¶] (3) A witness necessary for the
preliminary examination is unavailable due to the actions of the
defendant. [¶] (4) The illness of counsel. [¶] (5) The unexpected
engagement of counsel in a jury trial. [¶] (6) Unforeseen conflicts
of interest which require appointment of new counsel. [¶] The
magistrate shall dismiss the complaint if the preliminary
examination is set or continued more than 60 days from the
date of the arraignment, plea, or reinstatement of criminal
proceedings pursuant to Chapter 6 (commencing with Section
1367) of Title 10 of Part 2, unless the defendant personally
waives his or her right to a preliminary examination within
the 60 days.”
16
at p. 870 [provisions of section 859b “are mandatory, rather than
permissive”]; Ramos, supra, 146 Cal.App.4th at p. 729 [“[t]he
Legislature’s use of the word ‘shall’ to describe the action to be
taken by the magistrate means [section 859b] is absolute”].)
III. Section 859b Mandates Dismissal of the Amended
Complaint Against Garcia
The principal question of law raised by this writ proceeding
is: Does an in-custody defendant’s arraignment and plea on an
amended complaint trigger a new 10-day period for holding a
preliminary hearing under section 859b, thus mandating
dismissal of the amended complaint unless the defendant
personally waives that new 10-day time limit or the prosecution
shows good cause for a continuance?
Garcia argues that, based on the plain language of the
statute, his July 16, 2019 arraignment and plea on the amended
complaint was a triggering event, restarting the 10-day clock for
holding a preliminary hearing under section 859b. Because he
did not personally waive that new time limit, Garcia asserts he
had a statutory right to the mandatory dismissal of the amended
complaint and release from custody as of July 30, 2019, which
was 10 court days after his July 16 arraignment. The People,
on the other hand, contend that an arraignment or plea on an
amended complaint is not a triggering event under section 859b
because the filing of an amended complaint does not start a new
criminal proceeding, but rather acts as a continuation of the
previously filed charges. The People claim that, because Garcia
personally waived the 10-day and 60-day time limits for the
preliminary hearing at his June 21, 2019 arraignment on the
original complaint and no new triggering event occurred, he is
not entitled to dismissal of the amended complaint or release
17
from custody. We conclude, based on the plain language of
section 859b, the legislative purpose of the statute, and relevant
case law, Garcia’s arraignment and plea on the amended
complaint was a triggering event under section 859b, which
required the preliminary hearing be held within 10 court days of
that arraignment and plea unless Garcia personally waived his
right to a preliminary hearing within that 10-day period, or the
prosecution established good cause for a continuance.
A. Garcia’s July 16, 2019 Arraignment and Plea
on the Amended Complaint Triggered a New
Statutory Time Period for the Preliminary
Hearing Under Section 859b
Section 859b expressly provides, absent a waiver or a
showing of good cause for a continuance, the preliminary hearing
“shall be held within 10 court days of the date the defendant is
arraigned or pleads, whichever occurs later, or . . . the date
criminal proceedings are reinstated.” (§ 859b, 2d par.) When,
as here, the defendant is in custody, the magistrate “shall
dismiss the complaint” if the preliminary hearing is set more
than “10 court days from the time of the arraignment, plea, or
reinstatement of criminal proceedings,” unless the “defendant
personally waives his or her right to preliminary examination
within the 10 court days” or the “prosecution establishes good
cause for a continuance.” (Id. at 3d par.) Accordingly, once an
event enumerated in section 859b occurs, it triggers the 10-day
time limit for holding the preliminary hearing. By its terms, the
statute does not limit the triggering event of “arraignment”
or “plea” to an arraignment or plea on an original complaint.
Rather, the right to a preliminary hearing within the 10-day
period is triggered whenever the defendant “is arraigned or
18
pleads,” or “criminal proceedings are reinstated.” (Id. at 2d par.)
Absent a personal waiver by the defendant or showing of good
cause by the prosecution, the right to a mandatory dismissal of
the complaint is triggered whenever the preliminary hearing is
not held within 10 court days of “the arraignment, plea, or
reinstatement of criminal proceedings.” (Id. at 3d par.)
“‘The purpose of an arraignment or a rearraignment is to
inform the accused of the charge against him and to give him
fairly the opportunity to plead to it. . . .’ [Citation.]” (People v.
Turner (1994) 8 Cal. 4th 137, 187; see also People v. Hodges (2009)
174 Cal. App. 4th 1096, 1104 [“The purpose of the arraignment is
to inform the accused of the charge and give [him or] her an
opportunity to plead to it either by plea or demurrer, or move to
set it aside.”].) An arraignment generally consists of “reading
the accusatory pleading to the defendant and delivering to the
defendant a true copy thereof, . . . and asking the defendant
whether the defendant pleads guilty or not guilty to the
accusatory pleading.” (§ 988.) When an accusatory pleading,
such as a complaint, is amended, the “defendant shall be required
to plead to such amendment or amended pleading forthwith, or,
at the time fixed for pleading, if the defendant has not yet
pleaded and the trial or other proceeding shall continue as if the
pleading had been originally filed as amended. . . .” (§ 1009.) An
amended accusatory pleading therefore supersedes the original
pleading, which has no further effect. (People v. Scott (2013) 221
Cal. App. 4th 525, 533 [“when a pleading is amended, the original
pleading is thereby set aside and abandoned”]; People v. Mack
(1961) 197 Cal. App. 2d 574, 578 [“‘“an amendatory pleading
supersedes the original one, which ceases to perform any function
as a pleading”’”].) In addition, whenever an accusatory pleading
19
is amended, the defendant should be arraigned on the amended
pleading and asked to enter a plea to that new pleading. (See In
re Mitchell (1961) 56 Cal. 2d 667, 670 [noting “[t]here can be no
doubt that [defendant] should have been rearraigned” on
amended information that added prior felony conviction
allegation, but concluding “the failure to do so, under the facts
here involved, was, at most, a mere irregularity” that did not
deprive the court of jurisdiction]; People v. Hopkins (1974) 39
Cal. App. 3d 107, 119 [where prosecution amended information to
add great-bodily-injury allegation, “a substantial right of the
defendant . . . was prejudiced by the court’s failure to properly
arraign him . . . on the information as amended”]; People v.
Walker (1959) 170 Cal. App. 2d 159, 164 [“Where an information is
amended, regular and orderly procedure requires the defendant
be rearraigned and required to plead thereto before trial.”].)
In this case, the People amended the original complaint
to add three felony counts of possession of child pornography
against Garcia. On July 16, 2019, Garcia was arraigned on the
amended complaint and entered a plea of not guilty to all counts.
Under the plain language of section 859b, Garcia’s “arraignment”
and “plea” on the amended complaint constituted a triggering
event that entitled him to a preliminary hearing within 10 court
days of that arraignment and plea, unless he personally waived
his right to a preliminary hearing within that 10-day period. (§
859b.) Garcia did not enter a personal time waiver at any time
between July 16, 2019 (the date of his arraignment and plea on
the amended complaint) and July 30, 2019 (the date the 10-day
statutory period expired). Accordingly, as of July 31, 2019, the
amended complaint was subject to mandatory dismissal.
20
Construing Garcia’s arraignment and plea on the amended
complaint as a new triggering event under section 859b is also
consistent with the purpose of the statute. Section 859b “is
one of a number of statutes ‘that are supplementary to and a
construction of the constitutional right to a speedy trial.’” (People
v. Standish, supra, 38 Cal.4th at p. 870.) “The fact that the 10-
court-day deadline applies only to persons in custody at the time
of their arraignment or plea, whichever is later, has been held
to ‘manifest[ ] a legislative policy to eliminate the possibility
that persons charged with felonies might suffer prolonged
incarceration without a judicial determination of probable cause
merely because they are unable to post bond in order to gain
their freedom.’ [Citation.]” (Landrum v. Superior Court, supra,
30 Cal.3d at pp. 11-12.) Section 859b thus “reflects a clear
legislative intention to prevent prolonged incarceration prior to
a preliminary hearing.” (Id. at p. 12.) As Garcia points out, if an
arraignment under section 859b means only an arraignment on
the original complaint, then a defendant could enter a personal
time waiver at that first arraignment with bail having been set,
and later be placed on a no-bail hold as a result of a second
arraignment on an amended complaint that added more serious
charges. The defendant would then be subject to prolonged
incarceration with no statutory mechanism for asserting his
or her right to a timely preliminary hearing.
The decision in Davis v. Superior Court (2017) 18
Cal. App. 5th 1061 (Davis) also supports the conclusion that there
can be more than one triggering event under section 859b. In
Davis, an in-custody defendant waived his right to a preliminary
hearing within 10 court days and 60 days of entering a no guilty
plea on a felony complaint. On the day set for the preliminary
21
hearing, the superior court suspended the criminal proceedings
for purposes of a mental competency determination. After the
defendant was found competent to stand trial, the criminal
proceedings were reinstated. Over the defendant’s objection, the
court then reset the preliminary hearing for a date more than 10
court days after reinstatement of the criminal proceedings.
(Id. at p. 1064.) In granting the defendant’s petition for writ of
mandate, the court of appeal held that section 859b required that
the preliminary hearing be held within 10 court days of the date
that criminal proceedings were reinstated, notwithstanding the
personal time waiver made by the defendant prior to the
suspension of those proceedings. (Id. at pp. 1066-1067.)
As the Davis court explained: “[T]here are two categories of
triggering events in this part of section 859b: one is arraignment
and plea; the other is reinstatement of criminal proceedings. . . .
[¶] Each of these two categories of triggering events entitles a
defendant in custody to a preliminary hearing within 10 court
days, absent a personal time waiver, and a dismissal of the
complaint if the preliminary hearing does not occur. The words
and structure of the statute lead us to conclude that, if criminal
proceedings are suspended, the relevant personal time
waiver is one made after criminal proceedings are reinstated.”
(Id. at p. 1066, fn. omitted.) In construing the language of the
statute, the court observed that section 859b “uses the present
tense, not the past tense” in stating that the preliminary hearing
can be held beyond the 10-day statutory period “if the defendant
‘personally waives his or her right to preliminary examination.’”
(Id. at p. 1067.) The court also noted that the statute refers to
the 10-day period when a personal time waiver must occur as
22
“‘the 10 court days,’” which logically could only refer to the 10
court days after the triggering event of reinstatement. (Ibid.)
In reaching its holding, the Davis court rejected the
People’s reliance on People v. Love, supra, 132 Cal. App. 4th 276
(Love) to support their claim that the defendant was bound by his
prior time waiver. In Love, an out-of-custody defendant waived
her right to have a preliminary hearing within 10 court days and
60 calendar days of her plea. She then failed to appear at the
next scheduled hearing and a bench warrant was issued for her
arrest. The defendant appeared in custody five months later, and
over her objection, the superior court set the preliminary hearing
for a date more than 10 court days after her reappearance.
(Id. at pp. 280-282.) In concluding the defendant was not entitled
to the dismissal of her complaint under section 859b, the court of
appeal stated: “The Legislature has never codified a provision
imposing a 10-court-day limit for defendants who, having
previously waived time, find themselves in custody after a failure
to appear. Nor has the Legislature created a provision for the
withdrawal of properly entered waivers.” (Id. at p. 285.) In
distinguishing Love, the Davis court noted the issue before it
was “not whether a defendant may withdraw a validly entered
personal time waiver for preliminary hearing in the abstract, or
whether section 859b vitiates a validly entered personal time
waiver.” (Davis, supra, at 18 Cal.App.5th p. 1068.) Rather, the
issue was “whether section 859b requires a preliminary hearing
to be held within 10 court days after reinstatement of criminal
proceedings unless defendant personally waives his right to the
examination within the 10 court days after criminal proceedings
are reinstated.” (Ibid.) The Davis court concluded that it did.
23
In denying Garcia’s motion to dismiss, the superior court
cited Love for the proposition that the Legislature has never
codified a provision allowing for the withdrawal of a properly
entered waiver of the right to a timely preliminary hearing. Like
the Davis court, however, we conclude that the issue before us is
not whether Garcia was entitled to withdraw the time waivers
that he previously entered at his June 21, 2019 arraignment and
plea on the original complaint. Indeed, Garcia never asked to
withdraw those prior time waivers or argued that he could do so.
Rather, the issue is whether, under section 859b, Garcia’s July
16, 2019 arraignment and plea on the amended complaint was a
new triggering event that required a preliminary hearing to be
held within 10 court days absent Garcia’s personal time waiver.
As the Davis court recognized, section 859b creates “categories
of triggering events,” each of which entitles the defendant to a
preliminary hearing within a 10-court-day period unless he or
she personally waives that time limit. (Davis, supra, at 18
Cal.App.5th p. 1066; see also People v. Figueroa, supra, 11
Cal.App.5th at pp. 676-677 [describing arraignment, plea, and
reinstatement of criminal proceedings as three separate and
distinct triggering events under section 859b].) There is nothing
in the plain language of the statute to suggest that a prior time
waiver precludes a defendant from exercising his or her rights
under section 859b after a new triggering event occurs.
Here, Garcia had a statutory right to a preliminary hearing
within 10 court days of his arraignment and plea on the amended
complaint. Because Garcia did not personally waive that right
and the preliminary hearing was not held within that 10-day
period, he was entitled to dismissal of the amended complaint
under section 859b. (See, e.g., Landrum v. Superior Court, supra,
24
30 Cal.3d at p. 6 [violation of the 10-day rule in section 859b
“rendered the resulting commitment of the defendant illegal”];
Ramos, supra, 146 Cal.App.4th at p. 737 [“a defendant whose
right to a preliminary hearing within 60 days of arraignment is
violated is entitled to dismissal of the felony complaint”]; People
v. Henderson (2004) 115 Cal. App. 4th 922, 931 [“[i]f the court fails
to conduct the preliminary examination within the 10-day
period, the in-custody defendant is entitled to a dismissal”]).
B. Garcia’s August 2, 2019 Limited Time Waiver
Was Not a General Waiver of His Right to a
Timely Preliminary Hearing
In opposing the writ petition, the People assert that,
even if the July 16, 2019 arraignment and plea on the amended
complaint restarted the 10-day requirement of section 859b,
Garcia was not entitled to a dismissal because he subsequently
entered a time waiver on August 2, 2019. Citing this court’s prior
decision in Ramos, supra, 146 Cal. App. 4th 719, the People argue
that Garcia’s subsequent time waiver rendered moot any claim
that the trial court erred in denying his motion to dismiss.
In Ramos, the defendant was arraigned on an amended
felony complaint that charged her with murder and being an
accessory after the fact. At the request of Ramos’s codefendants,
the magistrate granted several continuances of the preliminary
hearing to a date more than 60 days after the arraignment.
Ramos objected to these continuances and later moved to dismiss
the amended complaint because the preliminary hearing was not
held within 60 days of her arraignment as required by section
859b. (Ramos, supra, 146 Cal.App.4th at pp. 723-724.) Following
the denial of her motion to dismiss and a writ petition before the
superior court, Ramos petitioned this court for a writ of mandate
25
compelling the dismissal of the amended complaint against her.
During the pendency of the writ proceedings, the preliminary
hearing went forward and Ramos was held to answer only to
the accessory-after-the-fact charge. (Id. at pp. 725-726.) Ramos
thereafter sought to withdraw her petition, and following oral
argument, she also filed a waiver of her right to a preliminary
hearing within the time limits of section 859b. (Id. at p. 723, fn.
2.) We concluded that Ramos’s personal waiver of rights under
section 859b “render[ed] moot her request for extraordinary writ
relief.” (Id. at p. 727.) We nevertheless exercised our discretion
to address the merits of her petition because it raised issues
about the proper application of section 859b to multiple-
defendant cases that were likely to recur. (Id. at p. 723, fn. 2.)
Ramos did not address the specific circumstances under
which a defendant may enter a valid time waiver after the 10-day
or 60-day period specified in section 859b has expired. However,
assuming, without deciding, that a defendant may retroactively
waive time under section 859b, Garcia’s waiver on August 2, 2019
was not a general waiver of his right to a preliminary hearing
within the statutory 10-day and 60-day periods. Instead, Garcia
entered a specific and limited time waiver in which he agreed
to continue the preliminary hearing to a date on or before
September 23, 2019. The record reflects that, after advising
Garcia that he had a “statutory right to a speedy preliminary
hearing, that is within 10 court days and 60 calendar days of
your arraignment,” Judge Bennett explained that, “presently,
it’s my understanding that today is set for day zero of 30,
which means that you would be going to preliminary hearing
within 30 days of today.” Judge Bennett then asked Garcia: “Do
you agree to waive and give up those rights so that your matter
26
can be continued to the date of August 23rd, 2019, with the
understanding that your preliminary hearing would be held on
that date or within 30 calendar days of that date?” Garcia
answered in the affirmative.
Accordingly, Garcia’s August 2, 2019 waiver was not, as
the People assert, an “unqualified” waiver of the time limits in
section 859b. Rather, Garcia’s time waiver was expressly
conditioned upon the preliminary hearing being held within 30
calendar days of August 23, 2019. Thirty calendar days from
August 23, 2019 was September 22, 2019, a Sunday. As a result,
Monday, September 23, 2019 was the last day on which the
preliminary hearing could be held based on Garcia’s limited
waiver. The preliminary hearing did not go forward on that date,
and thus, the specific condition that formed the basis for Garcia’s
30-day time waiver was not satisfied. (Irving v. Superior Court
(1979) 93 Cal. App. 3d 596, 599 [where defendant’s agreement to
continue the preliminary hearing to a date more than 10 court
days after his arraignment “was based upon a condition which
was not met,” it could “not operate as a valid waiver” of his rights
under section 859b].) Under these circumstances, Garcia’s
agreement to continue the preliminary hearing to a date on or
before September 23, 2019 did not constitute a general waiver of
his statutory right to a timely preliminary hearing.
C. At the September 23, 2019 Hearing, Garcia Did
Not Waive His Right to a Timely Preliminary
Hearing, Nor Was There A Finding of Good
Cause for a Continuance
In denying Garcia’s motion to dismiss, the superior court
concluded that the preliminary hearing was not required to be
held on September 23, 2019, the “30 of 30” date, because Garcia
27
“implicitly waived time” when his counsel advised the court that
he could not make a readiness announcement on that date due to
the parties’ ongoing discovery dispute. The court reasoned that,
even though defense counsel expressly stated that the defendants
were “not waiving time” at the September 23 hearing, “the court
is quite certain that had the court deemed the defendants ready
for preliminary hearing on that date that there would have been
an objection that their clients’ constitutional rights were being
violated as they had not had sufficient time to review all
discovery they believe may be relevant to the case so as to allow
for effective representation of the defendants.” The court thus
chose to “interpret” the statements of defense counsel that they
required additional time to review all of the discovery materials
“as an implicit waiver by the defendants to proceed to
preliminary hearing within the required time period.”
Contrary to the superior court’s finding, however, section
859b does not permit implicit time waivers. Rather, the statute
provides that a defendant’s right to a preliminary hearing within
the 10-day and 60-day periods must be “personally waive[d].” (§
859b.) The plain language of this provision means that defense
counsel cannot, either expressly or impliedly, waive the statutory
time limits for holding a preliminary hearing on the defendant’s
behalf. (Irving v. Superior Court, supra, 93 Cal.App.3d at p. 600
[“[a]ddition of the word ‘personally’ to the waiver provision” of
section 859b “must be read as eliminating the right of counsel to
waive the defendant’s right to speedy proceedings”].) Moreover,
the waiver of the right to a timely preliminary hearing under
section 859b must be clear, unambiguous, and consistent with the
requirements of the statute. As one appellate court observed in
concluding there had been no valid waiver, “[t]he fact that, based
28
upon the circumstances here, it may be a reasonable supposition
that [defendant] would have waived that right is no substitute for
the statute’s personal waiver requirement. [Citations.] Any
contention that defendant impliedly waived his rights under
section 859b must therefore be rejected.” (People v. Figueroa,
supra, 11 Cal.App.5th at p. 685, italics omitted.)
At the September 23, 2019 hearing, Garcia’s counsel
repeatedly asserted that Garcia did not wish to waive his rights
under section 859b. When the superior court inquired if Garcia
was seeking a continuance of the preliminary hearing, his
counsel stated: “My client is sitting in jail on a no bail hold. He
has a right to his legal and constitutional preliminary hearing
today. Period. And he is not going waive time and he is not
asking for a continuance. He is not asking for a delay.” When
the court decided to continue the preliminary hearing to
September 26, 2019, Garcia’s counsel reiterated that his client
was not agreeing to any waiver of rights, stating: “[Our
agreement] to come back at a date certain after today’s date is
not an implicit or implied waiver by Mr. Garcia for any purpose
. . . of his speedy trial rights. . . .” The superior court
nevertheless found that Garcia had “implicitly waived time”
based solely on the statements of his counsel that the defense
was not prepared to announce its readiness for the preliminary
hearing due to outstanding discovery issues. The right to a
timely preliminary hearing under section 859b belonged to
Garcia, not his attorney, and only Garcia could personally
waive the 10-day and 60-day time limits of the statute. The
court accordingly erred in finding that Garcia entered an
implied time waiver at the September 23, 2019 hearing.
29
Under section 859b, whenever a defendant is in custody
and does not personally waive time, the court must dismiss the
complaint if the preliminary hearing is set or continued beyond
the statutory 10-day period unless “the prosecution establishes
good cause for a continuance” for up to three additional court
days. (§ 859b, 3d par., subd. (b).)9 Where a continuance for good
9 The good cause exception to the mandatory dismissal rule
for an in-custody defendant who does not personally waive the
10-day time limit was added to section 859b in 1981. (Stats.
1980, ch. 938, § 1, p. 2965, eff. Jan. 1, 1981.) Prior to that
amendment, the statute provided, in relevant part: “Both the
defendant and the [P]eople have the right to a preliminary
examination at the earliest possible time, and unless both waive
that right or good cause for a continuance is found as provided
for in Section 1050, the preliminary examination shall be held
within 10 court days of the date the defendant is arraigned
or pleads, whichever occurs later. In no instance shall the
preliminary examination be continued beyond 10 court days from
such arraignment or plea whenever the defendant is in custody at
the time of such arraignment or plea and the defendant does not
personally waive his right to preliminary examination within
such 10 court days.” (Stats. 1977, ch. 1152, § 1; eff. Jan. 1, 1978.)
The 1981 statute deleted the provision that “[i]n no
instance shall the preliminary examination be continued
beyond 10 court days” for an in-custody defendant who does
not personally waive time, and instead provided that, where
the defendant is in custody, the magistrate “shall dismiss the
complaint if the preliminary examination is set or continued
beyond 10 court days from the time of the arraignment or plea”
unless “(a) [t]he defendant personally waives his or her right to
preliminary examination within the 10 court days,” or “(b) [t]he
prosecution establishes good cause for a continuance beyond
the 10-court day period.” (Stats. 1980, ch. 938, § 1, p. 2965.)
30
cause is granted, the defendant must be released on his or her
own recognizance pursuant to section 1318 unless one of six
enumerated exceptions to release applies. (Id., 5th par.) In this
case, however, we need not decide whether the superior court
could have continued the preliminary hearing to September 26,
2019 based on a finding a good cause under section 859b, as there
was neither a request for a continuance by any party, nor any
attempt by the prosecution to establish good cause.
The record reflects that neither the prosecution nor the
defense requested a continuance at the September 23, 2019
hearing, or argued that there was good cause to grant one. To
the contrary, the People announced they were ready to proceed
with the preliminary hearing on that date. While Garcia’s
counsel indicated the defense was not ready to proceed due to
the prosecution’s non-compliance with discovery, he specifically
stated that Garcia was not asking to continue the preliminary
hearing, and that “any continuance beyond today’s date would be
over Mr. Garcia’s objection.” The prosecution also expressed that
The 1981 statute did not include a definition of good cause.
In September 1987, however, section 859b was amended to state
that, for purposes of subdivision (b), good cause for a continuance
includes, but is not limited to, cases alleging a violation of certain
statutes involving child sexual assault or child abuse where “the
prosecuting attorney assigned to the case has another trial,
preliminary hearing, or motion to suppress in progress in that
court or another court.” (Stats. 1987, ch. 461, § 1, pp. 1699-1700.)
The 1987 legislation also added the same definition of good cause
to section 1050. (Stats. 1987, ch. 461, § 3, pp. 1701-1702.) Apart
from a technical amendment made in 1989 to cross-reference the
current versions of the applicable statutes (Stats. 1989, ch. 897,
§ 26.5, pp. 3066-3067), section 859b’s definition of good cause
adopted in September 1987 remains in effect.
31
a continuance “would be over the People’s objection” to the extent
it was based on a perceived lack of their “readiness to proceed to
trial today.”
In deciding to continue the preliminary hearing for three
additional days notwithstanding these objections, the superior
court never asked the prosecution to demonstrate the grounds for
a finding of good cause, nor stated that it had found good cause
for a continuance under section 859b. Rather, the court found
that the defendants were bound by the prior time waiver that
they had made at the arraignment on the original complaint.
Likewise, in denying Garcia’s motion to dismiss the amended
complaint, the court found that Garcia was not entitled to a
dismissal under section 895b because he had entered both an
express time waiver at the June 21, 2019 arraignment and an
implied time waiver at the September 23, 2019 hearing. The
court made no finding of good cause for a continuance.
Absent a personal and express time waiver by Garcia, he
was entitled to a preliminary hearing within the statutory period
applicable to the amended complaint. Garcia did not personally
waive the 10-day or 60-day time limits of section 859b at his July
16, 2019 arraignment and plea on the amended complaint or at
any time thereafter. Instead, Garcia entered a limited time
waiver on August 2, 2019 that was expressly conditioned upon
the preliminary hearing being held on or before September 23,
2019. The preliminary hearing was not held within that time
period and Garcia did not personally and expressly enter an
additional time waiver at the September 23, 2019 hearing.
32
Under these circumstances, section 859b mandates that the
amended complaint against Garcia be dismissed.10
DISPOSITION
Let a peremptory writ of mandate issue directing
respondent superior court to vacate its September 26, 2019
order denying Garcia’s motion to dismiss and its October 22, 2019
order denying Garcia’s petition for writ of mandate, prohibition,
or other appropriate relief, and to thereafter enter a new and
different order dismissing the amended complaint against him.
ZELON, J.
We concur:
PERLUSS, P. J.
FEUER, J.
10
In light of this conclusion, we need not address Garcia’s
argument that the failure to timely hold the preliminary hearing
also violated his constitutional right to a speedy trial.
33 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/8707810/ | *145RULING ON DEFENDANT’S MOTION TO AMEND JUDGMENT, FOR A NEW TRIAL, AND FOR JUDGMENT AS A MATTER OF LAW
JANET BOND ARTERTON, District Judge.
Following a six-day trial, the jury returned a verdict in.Plaintiff Andrew Barati’s favor on his claims under the Federal Rail Safety Act, 49 U.S.C. § 20109 (“FRSA”), and the Federal Employer Liability Act, 45 U.S.C. § 51 (“FELA”). Defendant Metro-North moves [Doc. # 137] pursuant to Federal Rules of Civil Procedure 59(e) and 60(b) to amend the judgment, for a new trial, and for judgment as a matter of law. For the reasons that follow, the portion of Defendant’s motion seeking to alter the judgment will be granted and the remainder denied.
I. Factual Background
In April 2008, while Andrew Barati was working as a trackman with Metro-North, he “tripped the jack” as Defendant taught him and thereby lowered the load of his jack all .at once onto his left foot, crushing his left big toe. He reported this injury to Defendant and was subsequently disciplined and terminated. He sought recovery for his injury under the FELA and under the FRSA for the discipline Defendant imposed, where Defendant’s decision to discharge him in violation of the FRSA was related to his protected activity of reporting his work-related injury.
On his FELA claim, the jury found that Plaintiff had proved that Metro-North was negligent, that such negligence played a part in bringing about his injuries and that Metro-North had proved that Plaintiffs own negligence contributed to 60% of his injuries. (See Verdict Form [Doc. # 123] at 1-2.) The jury awarded him $50,000 in damages, which the Court reduced by 60% to $20,000.
On his FRSA claim, the jury found that Mr. Barati had proved that Metro-North’s adverse action against him was due in part to his reporting this work-related injury, and awarded him $40,000 in emotional distress damages, $350 in economic damages for lost personal property, and $1,428 in lost wages, for a total of $41,778 in compensatory damages. (Id at 3.) The jury further awarded $1,000,000 against Metro-North in punitive damages.’ (Id)
II. Motion to Amend the Judgment Pursuant to Rule 59(e) and 60(b)
Defendant moves under Rule 59(e) and 60(b), asking the Court to alter the judgment to reflect the statutory cap on punitive damages provided under the FRSA. Defendant also argues that the punitive damages award must be further reduced to comport with due process.
A. Statutory Damages Cap
Under the FRSA, “[rjelief ... may include punitive damages in an amount not to exceed $250,000.” 49. U.S.C. § 20109(e)(3). Accordingly, Defendant’s motion to alter the judgment' to reflect-a punitive damages award of $250,000 is granted on consent.
B. Due Process
Defendant argues that under the factors set out in BMW of North America v. Gore, 517 U.S. 559, 574, 116 S.Ct. 1589, 134 L.Ed.2d 809 (1996), even Plaintiffs reduced punitive damages award is “excessively high.” The cases Defendant relies on, however, involved no statutory cap on punitive damages, see, e.g., State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 425, 123 S.Ct. 1513, 155 L.Ed.2d 585 (2003), and thus are not instructive as to how a legislative determination of a permissible punitive damages. maximum affects the analysis of excessiveness.
*146Three “guideposts” are set down in Gore: “(1) the degree of reprehensibility of the defendant's misconduct; (2) the disparity between the actual or • potential harm suffered by the plaintiff and the punitive damages award; and (3) the difference between the punitive damages awarded by the jury and the civil penalties authorized or imposed, in comparable cases.” Gore, 517 U.S. at 575, 116 S.Ct. 1589; Thomas v. iStar Fin., Inc., 652 F.3d 141, 148 (2d Cir.2011).
The “degree of reprehensibility” factor is “perhaps the most important indicium of the reasonableness of a punitive damages award.” Gore, 517 U.S. at 575, 116 S.Ct. 1589. Here, by their award of four times the statutory maximum,1 the jury registered their measure of reprehensibility to underscore their finding that Defendant’s conduct was in reckless disregard of Mr. Barati’s safety and FRSA rights. Their conclusion was supported by the evidence that Defendant failed to train Plaintiff properly, Defendant failed to provide adequate lighting, resulting in his injury which he promptly reported, and then singled Plaintiff out for discipline for a safety violation. They jury also had evidence that Defendant’s termination of Plaintiff2 was contrary to its written policies and FRA regulations, was a self-serving effort to discourage employee injury reporting in order to keep its injury and lost-workday statistics low, violated Defendant’s own obligation to accurately report employees’ on-the-job injuries and resulting lost work days, and contravened Defendant’s “safety statement” that “[w]e are committed to the safety of our employees and our customers,” and “[w]e are determined to provide a work environment where all employees work safely.” (Kirsch Testimony, Tr. Mar. 16, 2012 [Doe. # 149] at 24:10-19.) The jury, considering all the trial evidence, was entitled to conclude that Metro-North’s actions against an employee who reported an on-the-job injury which he sustained as a result of Defendant’s outdated training and the poor lighting provided in his ‘ work area, was very reprehensible. (See Section III infra; see also trial testimony of Anne Kirsch, George Gavalla, John Wagner, and Mark Ward.)
As to the “disparity” between compensatory damages and punitive damages awarded, Defendant excludes the $40,000 in emotional distress damages, which it claims cannot be recovered under the FRSA, see infra at 150, and argues that the resulting ratio between the amount of punitive damages ($250,000) and the remaining compensatory damages awarded ($1,778) is a constitutionally improper “ratio of nearly 141 to 1.” (Def.’s Mem. Supp. [Doc. # 138] at 10.) In Gore, the Supreme Court noted that while it has “consistently rejected the notion that the constitutional line is marked by a simple mathematical formula,” 517 U.S. at 582, 116 S.Ct. 1589, the ratio between compensatory damages and punitive damages is the “most commonly cited indicium of an unreasonable or excessive punitive damages award,” 517 U.S. at 580, 116 S.Ct. 1589 (“When the *147ratio is a breathtaking 500 to 1 ... the award must surely ‘raise a suspicious judicial eyebrow.’”) (internal citations omitted). Here, the ratio between the punitive award of $250,000 and total compensatory damages of $41,778 is approximately six to one; which should cause no judicial facial expression at all, much less a raised eyebrow. See State Farm Mut. Auto. Ins. Co. v. Campbell, 538 U.S. 408, 425, 123 S.Ct. 1513, 155 L.Ed.2d 585 (2003) (“Single-digit multipliers are more likely to comport with due process, while still achieving the State’s goals of deterrence and retribution, than awards with ratios in range of 500 to 1.”).
Gore’s final factor, “sanctions for comparable misconduct,” cannot be applied here because Mr. Barati’s case is the first FRSA case tried to a jury verdict in the country. Applying the two Gore factors to the circumstances of Mr. .Barati’s FRSA case, the Court concludes that Mr. Barati’s reduced punitive damages award does not violate due process, and accordingly, his $250,000 award will not be reduced.
III. Motion for a New Trial3
Metro-North moves for a new trial on the basis that it was unfairly prejudiced by the testimony of Plaintiffs expert witness George Gavalla.4 Metro-North asserts that Gavalla’s testimony was “highly speculative” and presented “a fairly scathing picture of ‘railroad culture’ ” which was unduly prejudicial to Metro-North. (Def.’s Mem. Supp. at 5.) It also contends that crossrexamination did not ^adequately cure the negative “culture” prejudice to Defendant which Plaintiffs counsel revisited and made the primary theme of his closing argument.
The Court denied Defendant’s pre-trial motion in limine to totally preclude Mr. Gavalla’s trial testimony but narrowed the scope of Mr. Gavalla’s permissible testimony to his experience and knowledge as the head of the Federal Rail Administration (“FRA”) Office- of Safety for seven years, with responsibility for carrying out the FRA’s safety inspection program, safety enforcement program, accident investigation program, and drafting of safety rules, regulations, and standards. (Gavalla Testimony, Tr. Mar. 20, 2012 [Doc. # 150] at 124:6-10.) Mr. Gavalla was not permitted to testify about the specifics of any particular railroad’s safety methodologies, only what he, in his capacity as the head of FRA’s Office of Safety, identified as the rules and safety regulations that railroads were required to implement, known as the “Internal Control Plan,” or “ICP.” Mr. Gavalla defined an ICP as:
a policy statement whereby a railroad states its commitment to the complete and accurate reporting of all accidents, employee injuries, occupational illnesses, and it sets forth its commitment to fully complying -with FRA’s regulations regarding accident incident reporting, and it also has a policy statement setting forth the railroad’s commitment to the prevention of or the prohibition against harassment or intimidation of railroad workers ... regarding the reporting of accidents and injuries, and it also re*148quires the railroads to sort of specify or set forth the system that they have in place to assure that those two objectives are met.
(Id. at 131:13-132:1.) Mr. Gavalla’s testimony about Metro-North’s own ICP was that it was “exactly identical to the FRA requirement,” which requires that the railroad “completely and accurately report all accidents, injuries and occupational illnesses, and that it comply with the requirements of the FRA regulations regarding accidents and injury reporting.” (Id. at 135:1-6.) It was the large gap between Defendant’s ICP and its actual practice that was the gist of Plaintiffs closing.
Mr. Gavalla did not testify as to “railroad culture” in the manner that Defendant contends. Indeed, Mr. Gavalla’s testimony was general, and not focused on any particular railroad’s culture, although he also did not exclude Metro-North. On direct examination, Mr. Gavalla testified about the importance of railroads accurately reporting injuries and employees’ “lost days from work” from injuries, and testified that the “FRA uses the lost days data as a measure of severity when making determinations of where to send their inspectors, ... [y]ou need to have accurate data on the severity of the accident and injury.” (Id. at 143:16-22.) He further opined that “[ojbviously, the whole point and purpose of the internal control plan is to ensure that a railroad has an effective ... safety management program in place so that you could identify incidents that were not reported properly and then correct them.” (Id. at 144:3-8.)
When asked, “in the context of all of the injuries reported to the FRA by all of the railroads during the year, what difference does it make to swear to the accuracy of an injury report that underreports lost injury days by one-third?” Mr. Gavalla responded:
Well, again, it goes to the — you’d have to look at the implications for why was that discrepancy allowed to occur. You’d have to ask the question, well, did the railroad — was the railroad deficient in their management of the safety process? Did it fail to actually find that data out and get it to the right people responsible in reporting it? So, did the people who were responsible for escalating that information — or giving that information to the reporting officer, did they not know what they were supposed to do, or did the system they have in place not catch them. And if the answer is, well, those things were okay, then you’d have to ask the question, well, was there something — was there a problem with the railroad’s safety culture, the integrity of it, its intentions to report. So, you’d have to look at why wasn’t that accident or injury reported properly.
(Id. at 144:14-145:6 (emphasis added).) On cross-examination, defense counsel clarified with Mr. Gavalla that when he had testified about the “culture of a railroad,” he was not speaking specifically about Metro-North, and Mr. Gavalla agreed, explaining that during his direct examination, “I was being asked to opine on the principles involved and the rule and the regulations involved as opposed to the specifics of the issue.” (Id. at 178:18-21.)
Mr. Gavalla also testified generally about “categories of conduct” which the FRA identified as falling within a particular ICP regulation with respect to the “harassment or intimidation of persons calculated to discourage or prevent the reporting of injuries.” (Id. at 147:19-22.) The categories he identified included: “singling out employees who are injured for disciplinary action,” disciplining employees who are injured on the job because of safety violations, while other employees, who commit the same safety violations and are not injured are not disciplined, and *149having management or railroad officials “threaten or recommend to employees that they’re better off not reporting an injury or an accident.” - (Id. at 148:1-16.) Mr. Gavalla spoke of these “categories of conduct” in a general manner, without providing any opinion as to whether Metro-North had or had not engaged in any such conduct. That testimony came from Defendant’s own employees which focused specifically on Metro-North’s safety regulations, policies, and “culture.” Metro-North’s Chief Safety and Security Officer, Anne Kirsch, was asked about Metro-North’s ICP, which required FRA approval, and about Metro-North’s safety rules and training materials, which are not required to be sent to the FRA. Ms. Kirsch testified that the safety manual required that “when lowering the jack, lower it one notch at a time. Do not release the load all at once” (Kirsch Testimony, Tr. Mar. 16, '2012 [Doc. # 149] at 33:9-10; Safety Rules [Ex. 10] at 1300.8). She identified this particular safety rule as “guidance ... provided to employees to ... prevent injuries when performing tasks” (Tr. at 149:14-18). However, Ms. Kirsch conceded that Metro-North had instead trained Plaintiff to lower a jack by “tripping it” and letting the load drop all at once (id. at 37:6-12), which is how Plaintiff injured himself. Ms. Kirsch also conceded that when Metro-North initially submitted its injury report about Mr. Barati’s injury, it underreported the number of “lost work days” by over -20 days. (Id. at 73-74.)
Given the testimony from Ms. Kirsch about Metro-North’s own safety rules, reporting policies, and disciplinary practices, juxtaposed with the general testimony provided by Mr. Gavalla about -the FRA’s role in investigating railroad workplace safety, and the importance of accurately reporting work-related injuries, it is clear that Mr. Gavalla’s testimony was proper and not unfairly prejudicial to Metro-North. It was Ms. Kirsch’s testimony, combined with testimony by Track Department Director John Wagner and Training Department Manager Mark Ward that revealed the discrepancies between Defendant’s articulated policies and its actual training practices and Defendant’s ’ disparate disciplinary treatment of just Plaintiff that entitled the jury to find Defendant liable under the FELA and FRSA.
Defendant generally objects to Attorney Goetseh’s rebuttal summation for the first time in post-trial briefing, but does not point to any specifics from the summation that it now challenges. A court considers claims of improper summation argument “in the context of the trial as a whole, examining, among other things, the ‘[t]otality. of the circumstances, including the nature of the comments, their frequency, their possible relevancy to the real issues before the jury, [and] the manner in which the parties and the court treated the comments.’ ” Okraynets v. Metro. Transp. Auth., 555 F.Supp.2d 420, 429 (S.D.N.Y.2008) (internal -citations omitted).
Attorney Goetsch’s remarks about a “safety culture” particular to Metro-North in his rebuttal responded directly to Attorney Fineman’s closing arguments that Metro-North did not have a “culture.” The context Attorney Goetsch set for his rebuttal included the pieces of evidence of improper training and poor lighting from which the jury could infer a violation of the FELA, and Defendant’s underreporting of Plaintiffs lost workdays and its disciplining only Plaintiff when he reported his injury as supporting a finding of a FRSA violation. He did nót mischaraetérize facts or testimony from Metro-North’s witnesses, and his description of this “safety culture,” which he argued evinced a reckless disregard for its employees, was argument that fell well within the bounds of propriety. No contemporaneous objection was taken to Attorney Goetsch’s comments *150about “safety culture,” and the jury had six days of trial evidence with which to evaluate Attorney Goetsch’s arguments. See Marcic v. Reinauer Transp. Companies, 897 F.3d 120, 127-28 (2d Cir.2005) (“To the extent that Reinauer’s counsel’s statements were improper, they were not objected to, and occurred in the context of a summation spanning thirty-seven pages of trial transcript, at the end of a week-long trial in which voluminous evidence was introduced that sufficed to support the jury’s verdict.”).
In short, absent a showing of undue prejudice from Mr. Gavalla’s testimony or Attorney Goetsch’s rebuttal summation focusing on Metro-North’s “culture,” there was no “manifest error” or a “miscarriage of justice” warranting a new trial.
IV. Motion for Judgment as a Matter of Law as to Emotional Distress Damages5
At trial, the Court charged the jury that FRSA remedies included compensatory damages, including emotional distress damages, and . denied Metro-North’s motion in limine to preclude Mr. Barati from offering any evidence or argument regarding the emotional distress he claimed to have suffered in connection with his FRSA claim. Defendant frames this issue again in its motion for judgment as a matter of law, arguing that the FRSA does not permit an award of emotional distress damages, and that the jury should not have been permitted to consider or award such damages. For the reasons that follow, the Court concludes that damages for emotional distress are available under the FRSA, and Metro-North’s motion is therefore denied.
Under the FRSA’s remedies section, “[a]n employee prevailing in any action ... shall be entitled to all relief necessary to make the employee whole.” 49 U.S.C. § 20109(e)(1). The damages section of the FRSA states in pertinent part:
(2) Damages. — Relief in an action under subsection (d) (including an action described in subsection (d)(3)) shall include—
(A) reinstatement with the same seniority status that the employee would have had, but for the discrimination;
(B) any backpay, with interest; and
(C) compensatory damages, including compensation for any special damages sustained as a result of the discrimination, including litigation costs, expert witness fees, and reasonable attorney fees.
Id. § 20109(e)(2).
The issue of whether- compensatory damages for emotional distress are recoverable under the FRSA appears to be one of first impression. Thus, Plaintiff and Defendant urge the Court to consider two other federal statutes for guidance. Plaintiff cites the remedies provision of the Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (“AIR-*15121”), as support for his argument that emotional distress damages are contemplated as part of the “compensatory damages” allowed under the FRSA and AIR-21. The AIR-21 Remedy section provides:
(B) Remedy. — If, in response to a complaint filed under paragraph (1), the Secretary of Labor determines that a violation of subsection (a) has occurred, the Secretary of Labor shall order the person who committed such violation to—
(i) take affirmative action to abate the violation;
(ii) reinstate the complainant to his or her former position together with the compensation (including back pay) and restore the terms, conditions, and privileges associated with his or her employment; and
(iii) provide compensatory damages to the complainant.
49 U.S.C. § 42121. Defendant relies on the language of the damages provision of the Sarbanes-Oxley Act (“SOX”) to support its conclusion that compensatory damages under the FRSA do not include damages for emotional distress. Under SOX, the section entitled “Remedies” provides:
(c) Remedies.' — ■
(1) In general. — An employee prevailing in any action under subsection (b)(1) shall be entitled to all relief necessary to make the employee whole.
(2) Compensatory damages. — Relief for any action under paragraph (1) shall include—
(A) reinstatement with the same seniority status that the employee would have had, but for the discrimination;
(B) the amount of back pay, with interest; and
(C) compensation for any special damages sustained as a result of the discrimination, including litigation costs, expert witness fees, and reasonable attorney fees.
18 U.S.C. § 1514A.
“As in all statutory construction cases, we begin with the language of the statute.” Barnhart v. Sigmon Coal Co., Inc., 534 U.S. 438, 450, 122 S.Ct. 941, 151 L.Ed.2d 908 (2002). However, the language of the FRSA permitting “compensatory damages” is without further detail as to the intended scope of this term beyond inclusion of “special damages.” AIR-21 similarly permits recovery for “compensatory damages” without detail or delimitation. SOX, on the other hand, while providing a make-whole remedy, limits “compensatory damages” to reinstatement, back pay and special damages. .A treatise definition of ‘compensatory damages’ is “the damages awarded to a person as compensation, indemnity, or restitution for harm sustained by him [or her],” Restatement (Second) of Torts §, 903 (1979). “Compensatory damages” are divided into those that are ‘pecuniary,’ and ‘non-pecuniary.’ Id. § 905. ‘Non-pecuniar/ compensatory damages include .“compensation for bodily harm and emotional distress, and are awarded without proof of pecuniary loss.” Id. § 905-06. ‘Special damages’ are defined as “compensatory damages for a harm other than one for which general damages are given.” Id. § 904.
Since both FRSA and AIR-21 have comparable “compensatory damages” provisions, and AIR-21 has served as a statutory model for the FRSA, which expressly incorporates the burden of proof of AIR-21, see 49 U.S.C. § 20109(d)(2)(i) (“Burdens of proof.—Any action brought under (d)(1) shall be governed by the legal burdens of proof set forth in section 12121(b) [AIR-21].”) (emphasis added); See also Araujo v. New Jersey Transit Rail Operations, Inc., 708 F.3d 152 (3d Cir.2013) (“[t]he FRSA incorporates by reference *152the rules and procedures applicable to Wendell H. ford Aviation Investment and Reform Act for the 21st Century (“AIR-21”) whistleblower cases.”),6 the construction of AIR-21 provides a better analog than SOX, particularly because they carry analogous safety whistleblower protections for employees in the airline and railroad industries. The few AIR-21 cases addressing emotional distress damages permit their recovery. See, e.g., Vieques Air Link, Inc. v. U.S. Dep’t of Labor, 437 F.3d 102, 110 (1st Cir.2006);7 Luder v. Continental Airlines, Inc., ARB Case No. 10-026 & ALJ Case No.2008-AIR-2009, 2012 WL 423490 (January 31, 2012).8 Significantly, there are no reported cases concluding that emotional distress damages are unavailable under AIR-21.
Adhering to the rule of statutory construction, “the meaning of a statute must, in the first instance, be sought in the language in which the act is framed, and if that is plain ... the sole function of the courts is to enforce it according to its terms,” Caminetti v. United States, 242 U.S. 470, 485, 37 S.Ct. 192, 61 L.Ed. 442 (1917). In the absence of any indication from the statutory language of an intention to limit “compensatory damages” to less than its generally accepted definition, the Court concludes that the FRSA permits recovery for emotional distress. This conclusion that no limitation was intended on the scope of damages recoverable is buttressed by the language that special damages are also included: “compensatory damages, including compensation for any special damages ...” Defendant’s view that this statutory language should be read as limiting compensatory damages to the itemized special damages is contrary to its plain meaning. See West v. Gibson, 527 U.S. 212, 217, 119 S.Ct. 1906, 144 L.Ed.2d 196 (1999) (“the preceding word ‘including’ makes clear that the authorization is not limited to the specified remedies there mentioned.”). Accordingly, Defendant’s motion for judgment as a matter of law pursuant to Rule 50(b) is denied, and Plaintiffs emotional distress damages in the amount $40,000 will stand.
V. Conclusion
For the reasons discussed above, Defendant’s motion to amend the judgment is GRANTED and Defendant’s motion for a new trial is DENIED. Defendant’s motion for judgment as a matter of law with re*153spect to emotional distress damages is also DENIED.
The Clerk is directed to amend the judgment to reduce the punitive damages award to the statutory cap of $250,000.
IT IS SO ORDERED.
. At the charge conference, the parties indicated their preference that the jury not be instructed as to the existence of the statutory cap to damages. This is not an uncommon practice. See, e.g., Luciano v. Olsten Corp., 110 F.3d 210, 221 (2d Cir.1997) (in a Title VII action, "§ 1981a envisions that the level of punitive damages to be awarded will initially be set by the jury, and that the jury will make that determination without being influenced by the statutory caps.”); Parrish v. Sollecito, 280 F.Supp.2d 145, 155 (S.D.N.Y.2003) ("[t]he statutory cap is properly excluded from jury instructions, and only after a verdict is submitted, the trial court must ensure that any award complies with the relevant statutory máximums applicable.”).
. Plaintiff’s termination was ultimately converted to a suspension without pay. • •
. "[F]or a district court to order a new trial under Rule 59(a), it must conclude that ",‘the jury has reached a seriously erroneous result or ... the verdict is a miscarriage of justice,’ ” i.e., it must view the jury's verdict as "against the weight of the evidence.’’ " Manley v. AmBase Corp., 337 F.3d 237, 244-45 (2d Cir.2003).
. Defendant offers no legal authority on which to base its motion for new trial on account of Gavalla's testimony, and the Court interprets Defendant's "unfair prejudice” argument as one referring to Federal Rule of Evidence 403, which provides that “[t]he court may exclude relevant evidence if its probative value is substantially outweighed by a danger of ... unfair prejudice.”
. Judgment as a matter of law may be rendered if “a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue.” Fed. R. Civ. Proc. 50(a)(1). A renewed Rule 50(b) motion will be granted "only if the evidence, 'drawing all inferences in favor of the non-moving party and giving deference to all credibility determinations of the jury, is insufficient to permit a reasonable juror to find in his favor.” Lavin-McEleney v. Marist College, 239 F.3d 476, 479 (2d Cir.2001). Thus, "judgment as a matter of law should not be granted unless (1) there is such a complete absence of evidence supporting the verdict that the jury findings could only have been the result of sheer surmise and conjecture, or (2) there is such an overwhelming amount of evidence in favor of the movant that reasonable and fair minded [persons] could not arrive at a verdict against [it].” Id. at 480 (quoting DiSanto v. McGrawHill, Inc., 220 F.3d 61, 64 (2d Cir.2000)). A movant under Rule 50 "faces a high bar.” Id.
. Araujo v. New Jersey Transit Rail Operations, Inc. is the first appellate decision to address the FRSA, and while the decision, which reversed a grant of summary judgment by the district court, does not address the damages inquiry, the Third Circuit explicitly noted looked to AIR-21 for the requirements for the FRSA plaintiff's prima facie case.
. In Vieques Air Link, the First Circuit affirmed an Administrative Law Judge's award of $50,000 in compensatory damages for “mental anguish,’’ writing:
[T]he ALJ relied on Negron’s testimony that he struggled to support his wife and two infant children while he looked for new full-time employment following his termination by VAL. Although Negron found a new job by mid-September, 2002, in the meantime he was forced to sell both of his family’s modest cars and deplete their meager savings to make ends meet. Negron specifically testified that this ordeal caused him suffering and, pain. The ALJ noted that like circumstances had justified similar awards in a number of cases which had come before the ARB; for its part, the ARB agreed with this assessment. Accordingly, we believe that substantial evidence supported the $50,000 award that Negron received for the mental anguish caused by his termination.
Vieques, 437 F.3d at 110.
. In Luder, the Administrative Review Board “affirmed compensatory damage awards for emotional distress, even absent medical evidence, where the lay witness statements are credible and unrefuted.” ARB Case No. 10-026 & ALJ Case No.2008-AIR-2009. | 01-03-2023 | 11-26-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/29530/ | IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
______________
No. 02-60077
_____________
PATRICK S ELLIOTT; DONNA J ELLIOTT
Petitioners - Appellants
v.
COMMISSIONER OF INTERNAL REVENUE
Respondent - Appellee
______________
No. 02-60078
_____________
LARRY ELLIOTT; JULIE F ELLIOTT
Petitioners - Appellants
v.
COMMISSIONER OF INTERNAL REVENUE
Respondent - Appellee
_________________________________________________________________
Appeals from the Decision of the
United States Tax Court
(19425-98 & 19433-98)
_________________________________________________________________
November 7, 2002
Before KING, Chief Judge, and JOLLY and HIGGINBOTHAM, Circuit
Judges.
PER CURIAM:*
*
Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
The notices of deficiency were not so inadequate as to
deprive the Tax Court of jurisdiction, and they were sufficient
to inform the Elliotts that their claimed business expense
deductions had not been allowed. That said, the Internal Revenue
Service clearly could have done considerably better and thereby
saved all involved, including the Tax Court and this court, from
this wasteful exercise.
AFFIRMED.
except under the limited circumstances set forth in 5TH CIR. R.
47.5.4.
2 | 01-03-2023 | 04-25-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3995971/ | Respondent, alleging injury in extrahazardous employment, filed his claim with the department for compensation. His claim was denied, for the reason that "the condition complained of does not constitute an injury as defined in § 7675 [P.C. § 3470], of the workmen's compensation act."
Thereafter, he applied to the joint board for a rehearing, and on June 13, 1932, the board allowed his claim to the extent of an award of one hundred and twenty dollars. On June 21, 1932, the claim was closed and the respondent notified of the fact. He thereafter continued to press his claim before the department, and it was again reopened, and on April 24, 1933, he was allowed four hundred and eighty dollars back compensation as well as a current monthly allowance of sixty dollars, this being the statutory allowance for an injured workman with a wife and two children. This allowance ceased after payments for the months of May and June. In the departmental file this notation appears:
"This claim should remain closed as claimant is employer and did not employ any workmen on date of injury. J.E. Sullivan. 7-12-33."
By letters dated August 14 and 25, 1933, respondent was directed by the department to report at Olympia for a special examination, and advised that the expense incurred in the trip would be paid. On October 19th, respondent addressed a letter to the department saying that he had reported for examination, but that his expenses had not been paid. In the letter, he also requested some explanation as to his claim. *Page 400
On November 2, 1933, J.E. Sullivan, claim agent for the department, addressed a letter to him saying:
"A review of the claim and audit files substantiates our contention that on the date of injury you were not employing any workmen. We, therefore, have no alternative but to stand on our rejection of July 12, 1933, of which you were verbally informed when you called at our office.
"At this time we are requesting you to refund to the Department the sum of $830.35, which has been expended by reason of your claim."
On October 5, 1934, the respondent filed a petition for rehearing before the joint board, in which, after referring to his injury and the allowance of his claim and payment of compensation, he states that he had never received any official notice of the closing of his claim and did not know whether it had been closed or not; that his condition has grown steadily worse and aggravated, entitling him to further compensation and an award for permanent partial disability or permanent total disability. He alleges aggravation entitling him to the reopening of his case independently of the question whether his claim was theretofore formally closed and notice thereof served upon him.
The joint board made an order granting the application for rehearing "as to the question of statute of limitations only." The respondent appealed to the superior court from this disposition of his petition.
The trial court, after making findings of fact and conclusions of law, entered a judgment reversing the order of the joint board and directing the department to pay claimant the compensation provided by law for permanent total disability from the 13th day of June, 1933.
[1] While the departmental letter of November 2, 1933, advises respondent that his claim was rejected on July 12, 1933, there is no formal order closing the *Page 401
claim, and the record does not disclose that the respondent was given the written notice provided by Rem. Rev. Stat., § 7697 [P.C. § 3488]. It is true the letter recites that the respondent was verbally informed when he called at the department's office. In his testimony before the superior court, respondent denied having received any notice. Neither does the record disclose any proof of the receipt of the letter of November 2, 1933, other than the fact that a carbon copy is in the file.
Under the rule announced in the case of Farrow v. Departmentof Labor Industries, 179 Wash. 453, 38 P.2d 240, we must hold that respondent did not receive the notice of the closing of his claim, provided by statute.
The sixty-day period for appeal to the joint board had lapsed when the letter of November 2nd was written. Even if there had been proof of the receipt or mailing to him of this letter, it could hardly in fairness be taken as a compliance with the statute. The letter assumes the giving of a notice not sustained by the record.
In the absence of formal notice, the respondent's right to apply for a rehearing before the joint board was not barred, especially so as he claimed aggravation which would entitle him to the reopening of his case within three years after it was closed.
[2] The order of the joint board reopening the case for the purpose of the statute of limitations only, whatever that may mean, was not the relief to which respondent was entitled. He was entitled to have his case reopened on the merits for consideration by the joint board of all questions raised by his petition. The order of the board was, in effect, a denial of his petition for rehearing, and an appeal to the superior court was the only recourse left to him. *Page 402
We are of the opinion that the proper judgment for the court to have entered was one remanding the case to the joint board with direction to grant a rehearing. The petition raised issues of fact which ought first to be passed upon by the joint board.
The judgment is accordingly reversed, and the cause remanded to the superior court for the entry of judgment directing the joint board to grant respondent's petition for rehearing.
MAIN, BEALS, TOLMAN, and BLAKE, JJ., concur. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3991432/ | I am not in accord with the majority opinion.
CONNELLY, J., dissents.
February 24, 1947. Petition for rehearing denied. *Page 776 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4523628/ | Case: 19-50833 Document: 00515375854 Page: 1 Date Filed: 04/08/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 19-50833
FILED
April 8, 2020
Summary Calendar
Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee
v.
JOSE ARNULFO PULIDO-MENDEZ,
Defendant-Appellant
__________________________________________________________________
Consolidated with No. 19-50834
UNITED STATES OF AMERICA,
Plaintiff-Appellee
v.
JOSE ARNULFO PULIDO-MENDEZ, also known as Jose Arnulfo P M, also
known as Jose Arnulfo Pulido, also known as Jose Pulido-Mendez, also known
as Jose Mendez-Pulido, also known as Jose Arnulfo Mendez-Pulido,
Defendant-Appellant
Appeals from the United States District Court
for the Western District of Texas
USDC No. 4:18-CR-242-1
USDC No. 4:19-CR-221-1
Case: 19-50833 Document: 00515375854 Page: 2 Date Filed: 04/08/2020
No. 19-50833
c/w No. 19-50834
Before WIENER, COSTA, and ENGELHARDT, Circuit Judges.
PER CURIAM: *
Jose Arnulfo Pulido-Mendez appeals from a judgment revoking his
previously-imposed supervised release and a judgment of conviction on his
guilty plea to illegal reentry, in violation of 8 U.S.C. § 1326. He argues that
the enhancement of his sentence based on his prior conviction pursuant to
§ 1326(b)(1), which increased the statutory maximum term of imprisonment to
10 years and the statutory maximum term of supervised release to three years
for his new illegal reentry offense, is unconstitutional because his prior
conviction is treated as a sentencing factor rather than an element of the
offense that must be alleged in the indictment and found by a jury beyond a
reasonable doubt. He concedes that the issue is foreclosed by Almendarez-
Torres v. United States, 523 U.S. 224 (1998), but he seeks to preserve the issue
for further review. The Government moves for summary affirmance, urging
that Pulido-Mendez’s argument is foreclosed.
The parties are correct that Pulido-Mendez’s argument is foreclosed by
Almendarez-Torres. See United States v. Wallace, 759 F.3d 486, 497 (5th Cir.
2014); United States v. Rojas-Luna, 522 F.3d 502, 505-06 (5th Cir. 2008).
Accordingly, the Government’s motion for summary affirmance is GRANTED,
see Groendyke Transp., Inc. v. Davis, 406 F.2d 1158, 1162 (5th Cir. 1969), the
Government’s alternative motion for an extension of time to file a brief is
DENIED, and the judgments of the district court are AFFIRMED.
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
2 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1975179/ | 419 Pa. Super. 295 (1992)
615 A.2d 372
KEMPER NATIONAL P & C COMPANIES and American Motorists Insurance Company as Subrogees of Rick Boyd and U.S. West Information Systems Inc., Appellants
v.
Kevin C. SMITH, D.C. and Kathy O. Smith, D.C. and the Ashton Village Chiropractic Health Center.
Superior Court of Pennsylvania.
Argued June 17, 1992.
Filed October 20, 1992.
*297 Leslie Martinelli-Cyr, Philadelphia, for appellants.
Alan S. Gold, Jenkintown, for appellees.
Before ROWLEY, President Judge, and HUDOCK and BROSKY, JJ.
BROSKY, Judge.
This is an appeal from the order of the lower court which sustained appellees' preliminary objections in the nature of a demurrer and dismissed appellants' complaint.
Before proceeding to address the issues raised by appellant, it is necessary to recount the relevant facts of this case. Craig Garsed and Rick Boyd, both residents of Arizona, were involved in an automobile accident on October 30, 1986 near Phoenix, Arizona. At the time of the collision, Mr. Boyd was employed by U.S. West Information Systems, Inc. and was insured under policies provided by appellants, Kemper National P & C Companies and American Motorists Insurance. Mr. Garsed sustained neck and back pain as a result of the accident and was treated by an Arizona chiropractor, Dr. Jeffrey Lowy, for these injuries. Mr. Garsed planned a trip to Philadelphia, Pennsylvania in December, 1986 and apprised Dr. Lowy of this event. Dr. Lowy advised Mr. Garsed that he *298 should seek chiropractic treatment if he experienced pain while on vacation. Mr. Garsed heeded this advice and sought treatment from appellees, Kevin Smith, D.C., Kathy Smith, D.C. and/or the Ashton Village Chiropractic Health Center in Philadelphia. After receiving chiropractic treatment from appellees, Mr. Garsed suffered a stroke that has left him permanently disabled.
Mr. Garsed instituted suit against Rick Boyd for all of his injuries, including those allegedly caused by appellees, in December, 1987. Appellants entered into a structured settlement agreement and release with Mr. and Mrs. Garsed in 1990.[1] The agreement provides that the Garseds will receive an immediate payment of $345,000.00 and periodic payments until October 1, 2015. In exchange for these payments, the Garseds completely released Mr. Boyd and appellants from all past, present and future claims attributable to the accident.[2] The agreement additionally provides that appellants reserved any rights of contribution and/or indemnity which they may have against appellees.
Appellants instituted suit against appellees on July 1, 1991 pursuant to which they sought contribution and/or indemnity for that portion of the Garseds' injuries which were allegedly caused by appellees. Appellees filed preliminary objections in the nature of a demurrer. In response to appellees' objections, appellants expressly indicated that the contribution claims were withdrawn. See Brief of Appellants in Opposition to Preliminary Objections of Appellees, at 3. Appellees' preliminary objections were sustained by the trial court which directed that the complaint be dismissed.[3] This timely appeal followed.
*299 Appellants present the following questions for review: (1) whether an insurer, who is a subrogee of the original tortfeasor and who settles with the injured plaintiff for all injuries arising out of an accident, is entitled to maintain an action for indemnification from a second or successive tortfeasor whose actions allegedly aggravated or caused additional harm to the injured plaintiff; and (2) whether appellees waived additional objections to the complaint which were raised in their reply brief but which were not set forth in the preliminary objections. For the reasons set forth below, we affirm the order of the lower court.
In reviewing the trial court's grant of preliminary objections in the nature of a demurrer,
[a]ll material facts set forth in the complaint as well as all inferences reasonably deducible therefrom are admitted as true for [the purpose of this review.] The question presented by the demurrer is whether, on the facts averred, the law says with certainty that no recovery is possible. Where a doubt exists as to whether a demurrer should be sustained, this doubt should be resolved in favor of overruling it.
Muhammad v. Strassburger, McKenna, Messer, Shilobod & Gutnick, 526 Pa. 541, 547, 587 A.2d 1346, 1349 (1991), cert. denied, ___ U.S. ___, 112 S. Ct. 196, 116 L. Ed. 2d 156 (1991) (citations omitted). Accord Vattimo v. Lower Bucks Hospital, Inc., 502 Pa. 241, 244, 465 A.2d 1231, 1232-1233 (1983).
Appellants contend that they are entitled to indemnification from appellees. We disagree. As explained by our Supreme Court:
`There is . . . a fundamental difference between indemnity and contribution. The right of indemnity rests upon a difference between the primary and secondary liability of two persons each of whom is made responsible by the law to an injured party. It is a right which enures to a person who, without active fault on his own part, has been compelled, by reason of some legal obligation, to pay damages occasioned by the initial negligence of another and for *300 which he himself is only secondarily liable. The difference between primary and secondary liability is not based on a difference in degrees of negligence or on any doctrine of comparative negligence.... It depends on a difference in the character or kind of the wrongs which cause the injury and in the nature of the legal obligation owed by each of the wrongdoers to the injured person. Secondary liability exists, for example, where there is a relation of employer and employee, or principal and agent.... Without multiplying instances, ... the important point to be noted in all the cases is that secondary as distinguished from primary liability rests upon a fault that is imputed or constructive only, being based on some legal relation between the parties, or arising from some positive rule of common or statutory law or because of a failure to discover or correct a defect or remedy a dangerous condition caused by the act of the one primarily responsible....' Thus, the rule is that where one's active negligence has been established in a prior action, and the record of that litigation is introduced in the present action for indemnity, indemnity is not available if the claimant's active fault has been established in the prior action.
Vattimo v. Lower Bucks Hospital, Inc., 502 Pa. at 250-251, 465 A.2d at 1236, quoting Builders Supply Co. v. McCabe, 366 Pa. 322, 325-328, 77 A.2d 368, 370, 371 (1951) (emphasis in original). Further:
Unlike comparative negligence and contribution, the common law right of indemnity is not a fault sharing mechanism between one who was predominantly responsible for an accident and one whose negligence was relatively minor. Rather, it is a fault shifting mechanism, operable only when a defendant who has been liable to a plaintiff solely by operation of law, seeks to recover his loss from a defendant who was actually responsible for the accident which occasioned the loss.
Walton v. Avco Corporation, 530 Pa. 568, 579, 610 A.2d 454, 460 (1992) (emphasis omitted), quoting Sirianni v. Nugent Brothers, Inc., 509 Pa. 564, 570-571, 506 A.2d 868, 871 (1986). *301 We will evaluate appellants' arguments and the decision of the lower court in accordance with the above principles.
Appellants initially argue that they have set forth a cause of action for indemnity against appellees because they were compelled, by operation of law, to pay for that portion of the Garseds' injuries which were allegedly attributable to appellees. For support, appellants refer us to the rule set forth in the Restatement (Second) of Torts § 457 (1965) pursuant to which a negligent actor who is held liable for another's bodily injury will also be deemed responsible for any additional bodily harm which results from the normal efforts of third parties to treat the other's injury, regardless of whether the third parties' acts are done in a proper or negligent manner. See Corbett v. Weisband, 380 Pa.Super. 292, 319, 551 A.2d 1059, 1072 (1988), allocatur denied, 524 Pa. 607, 569 A.2d 1367 (1989) and 524 Pa. 620, 571 A.2d 383 (1989); Embrey v. Borough of West Mifflin, 257 Pa.Super. 168, 175, 390 A.2d 765, 769 (1978); Lasprogata v. Qualls, 263 Pa.Super. 174, 180, 397 A.2d 803, 806 (1979) and the cases cited therein (which note that Pennsylvania has followed the Restatement rule). Appellants thus urge us to construe § 457 as a positive rule of law.
As applied in the context of an indemnity action, liability imposed pursuant to a positive rule of law suggests that a defendant is deemed responsible because of his or her relationship, not because of any actual negligence. For example, principals may be held liable for the acts of their agents, employers for the acts of their employees, suppliers for the acts of the manufacturers, municipalities for the acts of landowners in failing to keep their property safe, etc. See Builders' Supply Co. v. McCabe, supra (citing examples). § 457 of the Restatement, however, does not impose liability merely because of the original tortfeasor's status or relationship. Rather, the comments make clear that liability is imposed for any additional injuries caused by the medical providers because it is foreseeable that one who is injured by an original tortfeasor will seek treatment for those injuries. Simply stated, but for the negligent actions of the original tortfeasor, the plaintiff would not have been injured and would not have *302 been treated by the physician. It is for this reason that liability for any additional harm is imposed under § 457 and not because of any positive rule of law. Thus, appellants' liability for the Garseds' injuries, if any, stemmed from their own negligent conduct and not from a positive rule of law.
More importantly, appellants have failed to state a cause of action for indemnity because they have not been compelled to pay any damages for which they are legally liable. It is well settled that voluntary payments in exchange for the compromise of a claim are not compulsory and do not entitle the paying party to a claim for subrogation or indemnity. Tugboat Indian Co. v. A/S Ivarans Rederi, 334 Pa. 15, 20, 5 A.2d 153, 155 (1939). To be entitled to indemnity where there has been a voluntary payment, the paying party must demonstrate that he or she was legally liable and could have been compelled to satisfy the claim. Id., 334 Pa. at 21, 5 A.2d at 156.
As applied here, the certified record reveals that appellants voluntarily settled with the Garseds. However, appellants have not admitted that they were legally liable for the injuries sustained by the Garseds. See Appellants' Complaint, Exhibit B (Agreement of Settlement, Compromise and Release), at 2 (in which appellants and their insureds indicated that payment of the Garseds' claim was not to be construed as an admission of liability and that a substantial portion, if not all, of the damages were attributable to appellees). Appellants' complaint similarly contains no averments of liability. Under these circumstances, appellants have not stated a cause of action for indemnity because it does not appear from the pleadings and documents attached thereto they have been compelled to pay a claim for which they were legally liable. Tugboat Indian Co. v. A/S Ivarans Rederi, supra.
Even were we to assume that appellants are legally liable for the Garseds' injuries, appellants would not be entitled to indemnification if the injuries were the result of appellants' active or primary negligence. As indicated above, defendants who are actively negligent, as opposed to those *303 whose negligence is imputed, are precluded from obtaining indemnity. Vattimo v. Lower Bucks Hospital, Inc. and Builders Supply Co. v. McCabe, supra. Appellants recognize this principle and attempt to avoid it by asserting that their negligent conduct was passive or secondary to that of appellees or imputed by operation of law. As discussed above, liability for the Garseds' injuries is not imputed by operation of law, but is imposed as a direct and proximate result of the tortious acts committed by appellants' insured. Thus, appellants would not be entitled to indemnification from appellees in the event that their insured's active negligence caused the Garseds' injuries.
Despite their tortuous attempts to twist the facts of this case to make it squarely conform to the classic or typical indemnity situation, it is clear that appellants are actually attempting to equitably distribute or apportion responsibility for the Garseds' injuries between themselves and appellees. See Appellants' Brief at 10 (where appellants claim that indemnity is a procedure to approximate an equitable division of responsibility between the negligent parties and that such division is sought here) and 12 (where appellants admit that they are attempting to shift to responsibility to appellees for the injuries they allegedly caused to the Garseds); Appellants' Reply Brief at 3 (appellants indicate that they are only seeking to recover for those activities for which appellees were actively at fault). While appellants have not characterized it as such, appellants are essentially seeking to recover a form of contribution from a successive or independent tortfeasor.[4] Recovery of this type has not been expressly adopted in Pennsylvania either by statute or decisional authority. See 42 Pa.C.S.A. § 8324(a) (providing for contribution only among *304 joint tortfeasors) and Harka v. Nabati, 337 Pa.Super. 617, 623, 487 A.2d 432, 435 (1985) (providing that the right of contribution exists only between joint tortfeasors). However, several prior decisions of this court have permitted damages among successive or independent tortfeasors to be apportioned. See, e.g., Corbett v. Weisband, 380 Pa.Super. at 332-333, 551 A.2d at 1079; Lasprogata v. Qualls, 263 Pa.Super. at 179-180, 397 A.2d at 805-806; Embrey v. Borough of West Mifflin, 257 Pa.Super. at 185, 390 A.2d at 774.[5] These cases do not support appellants' position and are distinguishable.
Corbett involved a plaintiff who had a recurring knee injury. During the course of several years, the plaintiff was respectively treated by three different physicians. The last physician, Dr. Greene, eventually amputated the plaintiff's leg due to her chronic knee problems. The plaintiff subsequently instituted separate actions against each physician. The actions against the first two physicians were later consolidated for trial. At trial, the plaintiff sought to recover from the second physician for all of the damages relating to the subsequent care given by the third physician, i.e., the amputation of her leg. The trial court concluded, as a matter of law, that the second physicians were not liable for the injuries attributable to the third physician because the third physician's negligent conduct constituted a superceding or intervening cause which relieved the second physicians of liability. The trial court further excluded all evidence pertaining to the damages resulting from the third physician's treatment. On appeal, this court reversed each of the trial court's rulings and concluded that the question of whether the third physician's negligence was so highly extraordinary as to constitute a superceding or *305 intervening cause was a question to be resolved by the jury. We further held that the trial court erred in excluding evidence of the damages attributable to the third physician's treatment. Consequently, the plaintiff was awarded a new trial at which she could introduce evidence of all of her injuries and at which the second physicians would be permitted to introduce additional evidence suggesting that the damages could be apportioned.
In Lasprogata, the injured plaintiff settled with the original tortfeasor for only those injuries for which he was responsible. The plaintiff then sued the physician for the injuries which he allegedly caused. On appeal, we concluded that the physician was not entitled to contribution from the original wrongdoer because the injuries caused by each were separate and distinct, and hence could be apportioned. Because the plaintiff had settled with the original tortfeasor and had been compensated for only these injuries, he was entitled to maintain an action against the physician limited to those injuries allegedly due to the physician's negligence.[6]
Embrey presented a completely different situation in which the plaintiff brought separate actions against both the original tortfeasors and the medical providers. These actions were consolidated for trial and the jury was instructed to apportion the responsibility for the damages among those defendants found to be negligent. After trial, the medical providers settled with the plaintiff and sought contribution from the original tortfeasors. Contribution was denied. On appeal, this court approved of the trial court's method of apportioning responsibility for the injuries among the defendants and affirmed the denial of contribution.[7]
Unlike Embrey, this case does not involve a situation in which the plaintiffs sued both the original tortfeasor and the *306 negligent physician in a single action. This case similarly does not involve a situation like that in Lasprogata in which the plaintiff settled and released the original wrongdoer and is now seeking recovery from the physician for those injuries solely attributable to the physician's malpractice. Corbett is also distinguishable in that the question of contribution between prior and subsequent tortfeasors was never at issue; rather the only matter in dispute was the extent of the prior tortfeasor's liability to the plaintiff. These decisions therefore do not provide any support or basis for the contribution theory suggested by appellants.
Appellants appear to recognize this fact and refer us to the decisions of other jurisdictions which have permitted an original tortfeasor to recover from a second independent tortfeasor pursuant to a theory of implied or equitable indemnity, subrogation or contribution. See, e.g., Herrero v. Atkinson, 227 Cal. App. 2d 69, 38 Cal. Rptr. 490 (1964) (indemnity); Niles v. City of San Rafael, 42 Cal. App. 3d 230, 116 Cal. Rptr. 733 (1974) (followed Herrero);[8]R. & G. Orthopedic Appliances v. Curtin, 596 A.2d 530 (D.C.App.1991) (indemnity); Underwriters at Lloyds v. City of Lauderdale Lakes, 382 So. 2d 702 (Fla.1980) (subrogation); Gertz v. Campbell, 55 Ill. 2d 84, 302 N.E.2d 40 (1973) (indemnity); Hunt v. Ernzen, 252 N.W.2d 445 (Iowa 1977) (indemnity); Gulick v. Kentucky Fried Chicken Manufacturing Corp., 73 Mich.App. 746, 252 N.W.2d 540 (1977) (indemnity); New Milford Board of Education v. Juliano, 219 N.J.Super. 182, 530 A.2d 43 (1987) (indemnity); Musco v. Conte, 22 A.D.2d 121, 254 N.Y.S.2d 589 (1964) (indemnity); Travelers' Indemnity Co. v. Trowbridge, 41 Ohio St. 2d 11, 321 N.E.2d 787 (1975) (indemnity); Radford-Shelton *307 & Associates Dental Laboratory, Inc. v. St. Francis Hospital, Inc., 569 P.2d 506 (Okla.Ct.App.1976) (contribution); Greene v. Waters, 260 Wis. 40, 49 N.W.2d 919 (1951) (subrogation). But see Transcon Lines v. Barnes, 17 Ariz.App. 428, 498 P.2d 502 (1972) and Wilson v. Krasnoff, 560 A.2d 335 (R.I.1989)[9] (which have completely rejected the indemnity/subrogation theory and disallowed recovery on this basis).
We are not persuaded by the authorities in which a right to recovery pursuant to the doctrines of contribution, indemnity or subrogation has been recognized. Nearly all of these cases arose in states which, at the time the cases were decided, lacked statutes which provided for comparative negligence or contribution among tortfeasors. These decisions may thus be construed as an attempt by the courts to provide for the equitable apportionment of liability among multiple tortfeasors. With the exception of the District of Columbia, all of the jurisdictions previously permitting recovery on an indemnity or equivalent theory have enacted statutes or otherwise adopted comparative negligence principles which now provide for the apportionment of liability among all responsible defendants. See, e.g., Li v. Yellow Cab Co., 13 Cal. 3d 804, 119 Cal. Rptr. 858, 532 P.2d 1226 (1975) (adopting comparative negligence doctrine); Fla.Stat.Ann. § 768.31 (West 1975); Ill. Ann.Stat. ch. 70, para. 301-302 (Smith-Hurd 1979); Iowa Code Ann. § 668.3 (West 1984); Mich.Comp.Laws Ann. § 600.2925b (West 1974); N.J.Stat.Ann. 2A:15-5.2 (West 1973); N.Y.Civil Practice Law & Rules § 1401 (McKinney 1974); Ohio Rev.Code Ann. § 2307.33 (Anderson 1988); Okla. Stat.Ann. tit. 23, § 13 (West 1979); Wis.Stat.Ann. § 895.045 (West 1931).[10]See also Ariz.Rev.Stat.Ann. § 12-2506 C (1988) *308 (which provides for the apportionment of liability among all defendants, even those who are not parties).
Further, in the few cases which have arisen under these statutes, the courts have either disallowed recovery on the basis of indemnity or have held that the legislative enactments have abolished or superceded the previously recognized right to indemnity. See, e.g., Mayhew Steel Products, Inc. v. Hirschfelder, 150 Ill.App.3d 328, 103 Ill. Dec. 587, 501 N.E.2d 904 (1986), appeal denied, 114 Ill. 2d 547, 108 Ill. Dec. 419, 508 N.E.2d 730 (1987) (concluding that the common law right to indemnity was superceded by statute and indemnity was not specifically authorized therein); American Trust & Savings v. U.S. Fidelity & Guaranty Co., 439 N.W.2d 188 (Iowa 1989) (holding that equitable indemnity has been replaced by enactment of Iowa's comparative negligence act); Teepak, Inc. v. Learned, 237 Kan. 320, 699 P.2d 35 (1985) (characterizing claim for indemnity against negligent physician as one for contribution and holding that original tortfeasor was not entitled to recover either indemnity or contribution under Kansas' comparative negligence statute); Joiner v. Diamond M Drilling Co., 688 F.2d 256 (5th Cir.1982) (disallowing claim for indemnity, but permitting claim for contribution among successive or independent tortfeasors under Louisiana's contribution statute which permits contribution among successive or independent tortfeasors); Gruett v. Total Petroleum, Inc., 182 Mich.App. 301, 451 N.W.2d 608 (1990), reversed on other grounds, 437 Mich. 876, 463 N.W.2d 711 (1990) (only recognizing a limited right to indemnity where a party is free from active fault and there is a special relationship or course of conduct between the indemnitor and indemnitee); Salonia v. Samsol Homes, Inc., 119 A.D.2d 394, 507 N.Y.S.2d 186 (1986) *309 (amendments to New York's comparative negligence contribution law overruled prior caselaw recognizing a claim for indemnity). But see American Motorcycle Association v. Superior Court, 20 Cal. 3d 578, 146 Cal. Rptr. 182, 578 P.2d 899 (1978) (adopting a comparative indemnity theory).
Because many of the authorities relied upon by appellants have been affected by the enactment of subsequent statutes, we question the continuing precedential value of these decisions. Moreover, the rights of contribution and apportionment of liability among multiple defendants is a matter which is governed exclusively by statute in Pennsylvania. While some states have attempted to ameliorate the precise problem at issue here by limiting a defendant's liability for those injuries caused solely by his or her own negligence or by permitting the apportionment of liability among all tortfeasors, even those who have not been made parties, Pennsylvania's statute does not so provide. Rather, Pennsylvania only authorizes contribution among joint tortfeasors. Although Pennsylvania's version of the Uniform Contribution Among Tortfeasors Act preserves a common law right of indemnity, see 42 Pa.C.S.A. § 8323, the facts of this case do not fall within the classic indemnity relationship which has previously been recognized by our Supreme Court. Because the common law regarding contribution has been replaced by statutory authority which does not recognize a right of contribution among successive or independent tortfeasors, this court is not at liberty to endow appellants with such a right in contravention of that which has been granted by the legislature. To do so would undoubtedly disrupt the legislative scheme. If a new theory of recovery is to be recognized in Pennsylvania, it should come from either our Supreme Court or the legislature.
In view of our disposition of appellants' first issue, we need not address appellants' remaining claim relating to the waiver of additional objections by appellees.[11] In any event, it does *310 not appear that the trial court relied upon or even considered appellees' reply memorandum as it was not received by the court until after its order granting the demurrer had been entered.[12] Appellees also have not attempted to rely upon these additional grounds in their appellate brief. Under these circumstances, the question of whether appellees have waived their additional objections is irrelevant.
As a final point, we are compelled to comment upon the arguments raised by the parties relating to the lower court's opinion in which it concluded that the order granting the preliminary objections should be reversed. In support of its decision, the trial court appeared to indicate that the provisions of the settlement agreement could only be given effect by permitting appellants to maintain their action for indemnification. Trial Court Opinion, filed 1/2/92, at 3. Appellees present a complicated argument in response to the trial court's reasoning. According to appellees, the trial court erred because the settlement agreement expressly provides that it is to be construed in accordance with Arizona law. As indicated above, Arizona law did not permit an original tortfeasor to recover indemnity from a physician who aggravated or caused additional injury to the plaintiff. See Transcon Lines v. Barnes, supra. Because Arizona law did not recognize the cause of action preserved by appellants in their settlement agreement, appellees believe that appellants could not have reserved a cause of action which they did not possess. Therefore, refusal to permit appellants to proceed on their indemnification claim in Pennsylvania cannot be construed as a failure to give effect to the provisions of the settlement agreement. In response to appellees' argument, appellants simply contend that this claim has been waived. See Pa. R.A.P., Rule 302(a), 42 Pa.C.S.A. (providing that issues not *311 raised in the lower court are waived and cannot be raised for the first time on appeal).
Contrary to appellants' suggestion, appellees argument cannot be considered waived. The trial court sustained their objections and did not draft an opinion explaining its rationale in support of reversal until after an appeal had been filed. Because the ruling was initially favorable to appellees, they would have had no reason to file either a timely motion for reconsideration or an independent appeal. Thus, there was no stage of the lower court proceedings at which appellees could have challenged the trial court's rationale. For this reason, we find that strict compliance with the prohibition relating to matters raised for the first time on appeal is inappropriate under these particular circumstances. See Cagnoli v. Bonnell, 531 Pa. 199, ___, 611 A.2d 1194, 1195-96 (1992) (excusing an appellant's failure to raise an issue prior to filing her motion for reconsideration in the trial court where appellant's counsel did not have an opportunity to research and prepare cogent arguments in response to motions which were presented on the morning of trial). See also Pa.R.A.P., Rule 105(a), 42 Pa.C.S.A. (providing that the appellate procedural rules shall be liberally construed to secure the just, speedy and inexpensive determination of every matter to which they are applicable and that the rules, under certain circumstances may be disregarded in the interests of justice or for other good cause).
Although appellees' have not waived their claim, we nevertheless find their reasoning to be partially in error. The settlement agreement does not provide that Arizona law is to govern any subsequent actions for contribution or indemnity which appellants may have had against appellees. Instead, the settlement agreement merely provides that its terms are to be construed in accordance with Arizona law. To the extent that this provision does purport to dictate the law to be applied in any subsequent action for contribution or indemnity, we note that appellees were not parties to the settlement agreement and the choice of law provision could not be enforced against them. Thus, the question of whether appellants could maintain an action in Pennsylvania for indemnification *312 is not dependent upon any interpretation of Arizona law or the settlement agreement; rather, appellants' right to recover contribution or indemnity must be evaluated in accordance with Pennsylvania law.
Despite appellees' erroneous suggestion that appellants' claim must be evaluated in accordance with Arizona law, we agree with appellees that the trial court's reasoning was inaccurate. As explained above, the trial court appeared to conclude that it had a duty to give full effect to the provisions of the settlement agreement and that this mandate could not be fulfilled unless appellants were permitted to maintain an action for indemnification. See Trial Court Opinion, supra.
Contrary to the trial court's conclusion, dismissal of appellants' indemnification action for failure to state a claim upon which relief could be granted is not to be equated with a refusal to give full effect to the terms of the settlement agreement. Appellants' ability to recover contribution and/or indemnity is completely independent of and unrelated to the enforcement of the settlement agreement. In this case, appellants' voluntarily settled with the Garseds, and in doing so, appeared to operate under the mistaken belief that they would be successful in recovering a portion of the settlement from appellees. Appellants' mistaken assumptions regarding their ability to maintain a cause of action for contribution and/or indemnity, do not negate or otherwise affect the terms of the settlement agreement or appellants' responsibilities thereunder.
More importantly, appellants could only have reserved whatever claims for contribution and/or indemnity which may have existed in the jurisdiction in which such actions ultimately would be commenced against appellees. In this case, we have determined that Pennsylvania law does not permit appellants to recover indemnification from appellees. Appellants' attempt to reserve a right to indemnification in the settlement agreement does not change this result. As observed by our Supreme Court, "claiming to reserve a right will not operate to create [that] right." Walton v. Avco, 530 Pa. at 582, 610 A.2d at 461. We therefore reject the trial court's suggestion *313 that the settlement agreement would be rendered meaningless if appellants' were precluded from maintaining an indemnity action against appellees.
Order affirmed.
NOTES
[1] This agreement was executed in Arizona and provides that it is to be construed in accordance with Arizona law. This provision is not binding on appellees, who were not parties to the agreement, and Arizona law has no application to these proceedings.
[2] However, the agreement does not expressly state that the Garseds' released appellees or that appellees' liability was extinguished.
[3] The trial court granted appellees' preliminary objections and dismissed the complaint. Upon further reflection, however, the trial court concluded that it erred and has drafted an opinion explaining why its prior decision should be reversed.
[4] Because the acts of appellants and appellees are severable as to time and because each allegedly breached a different duty of care owed to Mr. Garsed, appellants and appellees are not joint tortfeasors. See, e.g., Harka v. Nabati, 337 Pa.Super. 617, 622-623, 487 A.2d 432, 435 (1985); Voyles v. Corwin, 295 Pa.Super. 126, 130-131, 441 A.2d 381, 382 (1982); Lasprogata v. Qualls, 263 Pa.Super. 174, 179, 397 A.2d 803, 805 (1979) (all of which hold that an original wrongdoer and a physician who aggravates the existing injury or causes new injury are not joint tortfeasors).
[5] In Lasprogata v. Qualls, this court suggested that an original wrongdoer may have the right of indemnity against the treating physician if the original tortfeasor is held liable for damages resulting from both his negligence and that of the physician. Id., 263 Pa.Super. at 178 n. 2, 397 A.2d at 805 n. 2. This statement is dicta and was completely unnecessary and irrelevant to the disposition of the issues before the court. In any event, the statement is erroneous as it conflicts with both prior and subsequent Supreme Court precedent which definitively indicates that an actively negligent tortfeasor is not entitled to indemnity. See Vattimo v. Lower Bucks Hospital, Inc. and Builders Supply Co. v. McCabe, supra.
[6] We note that virtually identical issues were raised by the physicians in Harka v. Nabati and Voyles v. Corwin. Thus, these decisions are similarly distinguishable from this case.
[7] The principles enunciated in Embrey have, in effect, been incorporated into Pennsylvania's Comparative Negligence Statute, codified at 42 Pa.C.S.A. § 7102(b), which provides for the apportionment of liability among each of the defendants against whom a plaintiff has recovered.
[8] Although the California court indicated in Herrero and Niles that the original tortfeasors were entitled to indemnity from the medical providers, it appears that the court actually allowed equitable apportionment of the injuries between the original and subsequent wrongdoers since both had been sued by the injured plaintiffs. See Herrero v. Atkinson, 227 Cal.App.2d at 75, 38 Cal. Rptr. at 493-494; Niles v. City of San Rafael, 42 Cal.App.3d at 240, 116 Cal. Rptr. at 738. To this extent, the reasoning in Herrero and Niles is more closely analogous to the apportionment recognized in Embrey and the Restatement (Second) of Torts § 434 (1965).
[9] Wilson is unique in that Rhode Island does not adhere to the rule set forth in § 457 of the Restatement (Second) of Torts, discussed ante, at 375. Wilson, 560 A.2d at 340. Rhode Island considers subsequent medical malpractice to be an independent intervening cause. Id. Thus, an initial tortfeasor is not liable for additional harm caused by subsequent medical malpractice but is only held responsible for the injury caused by his or her own negligence.
[10] The District of Columbia has not enacted any provisions relating to comparative negligence or contribution among tortfeasors. Thus, common law principles continue to be applied therein. It is also noted that several of the jurisdictions either adopted comparative negligence or enacted their respective statutes before the decisions permitting equitable indemnity or subrogation were issued. Decisions arising in these jurisdictions primarily cited to existing authority without discussion or consideration of the impact that subsequently enacted comparative negligence statutes had thereon. Other cases, however, merely adopted a new theory without reference or discussion of their own comparative negligence statutes or cases. In the absence of such analysis, we do not find these authorities to be persuasive.
[11] Appellees appeared to raise additional grounds in support of their preliminary objections in the nature of a demurrer in a reply memorandum of law which they filed in response to appellants' memorandum in support of their opposition to appellees' objections.
[12] The Reply Memorandum contains a handwritten notation which appears as follows: "Moot when rec'd (9/30) Order entered on 9/25". The notation is followed by the initials "AWS", the initials of the trial judge who ruled upon the objections. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/151219/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-5080
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
KSENIA STEKOLSTSIKOVA,
Defendant - Appellant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Mark S. Davis, District
Judge. (2:09-cr-00003-MSD-TEM-18)
Submitted: July 14, 2010 Decided: July 21, 2010
Before MOTZ and DAVIS, Circuit Judges, and HAMILTON, Senior
Circuit Judge.
Dismissed in part; affirmed in part by unpublished per curiam
opinion.
Paul G. Watson, IV, PAUL G. WATSON, IV, P.C., Eastville,
Virginia, for Appellant. Stephen Westley Haynie, Assistant
United States Attorney, Norfolk, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Ksenia Stekolstsikova appeals from her conviction and
twenty-month sentence entered pursuant to her guilty plea to
conspiracy to defraud the United States. Counsel has filed a
brief pursuant to Anders v. California, 386 U.S. 738 (1967),
concluding that there are no meritorious grounds for appeal but
questioning whether the sentence was unreasonably long. In her
pro se supplemental brief, Stekolstsikova asserts that the
presentence report (“PSR”) contained errors, that the court
improperly considered her co-conspirators’ sentences when
choosing the appropriate sentence, and that her attorney was
ineffective during the sentencing hearing. The Government filed
a motion to dismiss the appeal on the basis of the appellate
waiver contained in Stekolstsikova’s plea agreement.
A defendant may waive the right to appeal if that
waiver is knowing and intelligent. United States v. Poindexter,
492 F.3d 263, 270 (4th Cir. 2007). On appeal, Stekolstsikova
does not challenge the validity of her appellate waiver. She
argues only that certain claims are not foreclosed by the
waiver. Our independent review of the record supports the
conclusion that Stekolstsikova voluntarily and knowingly waived
her right to appeal as part of the decision to plead guilty
rather than go to trial. Thus, we conclude that the waiver is
valid and enforceable.
2
However, as noted by Stekolstsikova, even a valid
waiver does not waive all appellate claims. Specifically, a
valid appeal waiver does not preclude a challenge to a sentence
on the ground that it exceeds the statutory maximum or is based
on a constitutionally impermissible factor such as race, arises
from the denial of a motion to withdraw a guilty plea based on
ineffective assistance of counsel, or relates to claims
concerning a violation of the Sixth Amendment right to counsel
in proceedings following the guilty plea. United States v.
Johnson, 410 F.3d 137, 151 (4th Cir. 2005). The only claim
raised by Stekolstsikova that falls outside the scope of her
appellate waiver is her assertion that counsel was ineffective
during her sentencing hearing. In addition, we are charged
under Anders with reviewing the record for unwaived error.
Thus, we grant the Government’s motion to dismiss in part and
dismiss the claim raised by counsel, as well as the remaining
claims in Stekolstsikova’s pro se brief. We deny the motion to
dismiss with regard to Stekolstsikova’s ineffective assistance
claim, as well as any unwaived claims discovered during our
Anders review.
In her claim of ineffective assistance of counsel at
the sentencing hearing, Stekolstsikova asserts that her counsel
withdrew objections to the PSR without her consent. She lists
certain alleged factual errors in the PSR, but she fails to show
3
how pursuing these objections would have altered her Guidelines
range or her actual sentence. In any event, claims of
ineffective assistance of counsel are generally not cognizable
on direct appeal. United States v. King, 119 F.3d 290, 295 (4th
Cir. 1997). Rather, to allow for adequate development of the
record, a defendant must bring her claim in a 28 U.S.C.A. § 2255
(West Supp. 2010) motion. See id. An exception exists when the
record conclusively establishes ineffective assistance. United
States v. Richardson, 195 F.3d 192, 198 (4th Cir. 1999).
Our review of the record fails to conclusively
establish ineffective assistance. Thus, Stekolstsikova’s claim
is not cognizable on direct appeal. Moreover, our review of the
record did not disclose any unwaived, meritorious claims for
review. Accordingly, we affirm Stekolstsikova’s sentence. We
deny Stekolstsikova’s motion to substitute counsel.
This court requires that counsel inform his client, in
writing, of her right to petition the Supreme Court of the
United States for further review. If the client requests that a
petition be filed, but counsel believes that such a petition
would be frivolous, then counsel may move in this court for
leave to withdraw from representation. Counsel’s motion must
state that a copy thereof was served on the client. We dispense
with oral argument because the facts and legal contentions are
4
adequately presented in the materials before the court and
argument would not aid the decisional process.
DISMISSED IN PART;
AFFIRMED IN PART
5 | 01-03-2023 | 07-21-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/1275540/ | 175 Ga. App. 769 (1985)
334 S.E.2d 358
ROBINSON
v.
THE STATE.
McNEALY
v.
THE STATE.
CALHOUN
v.
THE STATE.
70530, 70531, 70532.
Court of Appeals of Georgia.
Decided September 4, 1985.
Leon Larke, for appellants (case nos. 70530, 70531).
Michael C. Garrett, for appellant (case no. 70532).
Sam B. Sibley, Jr., District Attorney, for appellee.
CARLEY, Judge.
Certain law enforcement officers were advised by a confidential informant that a certain vehicle containing a quantity of marijuana had been observed. A surveillance of the vehicle was maintained before it was stopped by the agents. Appellant McNealy was driving, appellant Calhoun was in the front passenger seat, and appellant *770 Robinson and one Dukes were in the rear seat. In the trunk, four pressed bales of marijuana were discovered. All four of the vehicle's occupants were indicted and jointly tried for trafficking in marijuana in violation of OCGA § 16-13-31 (c). The jury returned guilty verdicts against appellants only, who filed separate appeals from the judgments of conviction entered on the guilty verdicts. All three appellants raise only the general grounds by enumeration as error the denial of their respective motions for a directed verdict of acquittal, and their appeals have been consolidated for resolution in this opinion.
1. The evidence adduced at trial insofar as appellant Calhoun is concerned was as follows: On a Tuesday in March of 1984, appellant Calhoun, a resident of Fort Lauderdale, Florida, visited the Metter, Georgia, home of his elderly mother and nephew, the latter of whom is appellant McNealy. Stating that his own automobile was in need of repair, appellant Calhoun borrowed his mother's automobile. Her automobile was generally available for use by a few of her relatives, and it was her automobile in which appellants and the contraband were subsequently discovered. Appellant Calhoun left Metter in his mother's car that day or the following day and drove to Fort Lauderdale, where he picked up appellant Robinson. Appellants Calhoun and Robinson returned to Metter on Thursday, and spent the night. On Friday, appellant McNealy agreed to drive appellants Calhoun and Robinson to Augusta in the car. On the way to Augusta, appellants stopped at the home of Dukes, who joined them for the trip to Augusta. Once in Augusta, the men made several stops, including a stop at a gas station where Calhoun made approximately five phone calls, and two visits to the home of James Brown. Subsequently they were stopped and arrested.
In addition to the marijuana found in the trunk, the agents also discovered in the automobile two jackets and a pistol. Both jackets belonged to appellant Calhoun. In the pocket of one of the jackets was a piece of paper on which was written two columns of numbers. Beside "#1" was written "47," beside "2" was written "47," then "3" and "45," and then "4." Beside that number, the paper was torn, revealing only another "4." On the other side of the paper the number "174" was written. It was stipulated at trial that the total weight of the four bales of marijuana was 174.2 pounds.
Appellant Calhoun contends that since it was undisputed that other individuals had "equal access" to the automobile, the evidence did not authorize a finding that he was in possession of the contraband. See generally Farmer v. State, 152 Ga. App. 792 (264 SE2d 235) (1979); OCGA § 16-13-31 (c). However, "[b]ecause the [S]tate did not show the indicia giving rise to the presumption, that is, ownership or exclusive control of the vehicle [at the time of arrest,] no presumption arose and therefore there was no triggering of the equal *771 access defense." Castillo v. State, 166 Ga. App. 817, 822 (305 SE2d 629) (1983). Nonetheless, all of the competent evidence adduced at trial may be considered to show constructive possession, even though no presumption of possession arose. See generally Farmer v. State, supra at 796-797.
The jury was authorized to find that appellant Calhoun had constructive possession of the marijuana. There was substantially more presented at trial than evidence of Calhoun's mere presence at the scene of the crime. Calhoun had had exclusive control over the automobile for the four days immediately prior to his arrest. Even following his surrender of exclusive control over the automobile when he gave the keys to appellant McNealy on the day of his arrest, appellant Calhoun was present at the automobile at all times until his arrest. Most importantly, the jury could reasonably infer that the paper discovered inside Calhoun's jacket made reference to the four bales of marijuana found in the trunk of the automobile and the total weight of that marijuana. Appellant Calhoun did not offer any explanation for the meaning of the paper or for the purpose of the trips to Augusta and Fort Lauderdale.
"`To warrant a conviction on circumstantial evidence, the proved facts shall not only be consistent with the hypothesis of guilt, but shall exclude every other reasonable hypothesis save that of the guilt of the accused.' [Cit.]" Denham v. State, 144 Ga. App. 373, 374 (241 SE2d 295) (1977). "Questions of reasonableness are generally decided by the jury, and this court will not disturb the jury's finding that the evidence was sufficient to exclude every reasonable hypothesis save that of guilt unless the verdict is unsupportable as a matter of law. [Cits.]" Shockley v. State, 166 Ga. App. 182 (303 SE2d 519) (1983). The evidence was sufficient to enable any rational trior of fact to find the existence of the offense charged beyond a reasonable doubt. Jackson v. Virginia, 443 U.S. 307 (99 SC 2781, 61 LE2d 560) (1979); Anderson v. State, 166 Ga. App. 459, 460 (3) (304 SE2d 550) (1983).
2. The evidence concerning appellant McNealy was as follows: Appellant McNealy resided with his grandmother, the owner of the automobile in which the contraband was discovered, and was the nephew of appellant Calhoun. When Calhoun and appellant Robinson returned to Metter from Fort Lauderdale on Friday morning, appellant McNealy agreed to drive the two men to Augusta so that appellant Calhoun could take care of "some business" with "somebody." Appellant McNealy took the automobile keys and retained possession of them until appellants were arrested. McNealy got out of the car with Calhoun when they went to Duke's trailer. Appellant McNealy knew James Brown, and also went to the door of James Brown's house. Appellants were stopped and arrested at approximately 4:30 p. m. that afternoon. Appellant McNealy testified at trial, denying any *772 knowledge of the contraband.
Appellant McNealy also asserts that because others had "equal access" to the automobile, it cannot be inferred as a matter of law that he had constructive possession of the contraband, and that there was no other evidence establishing his possession of the marijuana. "`"Where immediate and exclusive possession of an automobile, locker room, or other premises is shown, the inference is authorized that the owner of such property is the owner of what is contained therein, and this inference has been referred to as a rebuttable presumption. [Cits.]" However, "(a)s to automobiles, the rule does not apply where there is evidence in the case that the defendant has not been in possession of the vehicle for a period of time prior to the discovery of the contraband or that others have had access to it. [Cit.]"' [Cits.]" (Emphasis in original.) Farmer v. State, supra at 795.
In the present case, because appellant McNealy was driving the automobile when the contraband was discovered, an inference was authorized that McNealy had possession of the marijuana discovered in that automobile. We find that there was no evidence that others had "equal access" to the automobile which would make the presumption inapplicable. Although there was evidence that appellant Calhoun and perhaps the other defendants had equal access to the trunk of the automobile, the doctrine does not apply where the defendants are alleged to have joint constructive possession of the contraband. Castillo v. State, supra at 822. Moreover, although there was some evidence that relatives had had access to the automobile in the past, because it was shown that only the defendants had access to the automobile for four days prior to the discovery of the large amount of contraband in the trunk, we find that others did not have "equal access" to the automobile.
In addition to the presumption that appellant McNealy was in joint constructive possession of the contraband, "[w]here transactions involving relatives are under review slight circumstances are often sufficient to induce a belief that there was collusion between the parties. [Cits.]" Heard v. State, 142 Ga. App. 703, 704 (236 SE2d 911) (1977). As previously noted, appellant McNealy was the nephew of appellant Calhoun.
"We must view the evidence in a light most favorable to the verdict and, in doing so, we conclude that the evidence was sufficient to exclude every reasonable hypothesis save [appellant McNealy's] guilt and that any rational trier of fact could have found [McNealy] guilty beyond a reasonable doubt. [Cits.]" Castillo v. State, supra at 821. Jackson v. Virginia, supra.
3. Finally, appellant Robinson raises the general grounds. The evidence shows that appellant Robinson had known appellant Calhoun for several years, and that both were residents of Fort Lauderdale. *773 Appellant Robinson testified at trial that one evening Calhoun approached him in a lounge in Fort Lauderdale and asked him to ride up the street to pick up Calhoun's automobile. Appellant Robinson agreed. The two men then drove the car Calhoun had driven to the lounge to Calhoun's home, where, for reasons allegedly unknown to Robinson, the men switched vehicles, taking the automobile in which they were later arrested. Appellant Robinson further testified that after entering the second automobile, he fell asleep immediately. When he awoke, he was in Georgia. He then told Calhoun that he should have been told that they were going to Georgia, and fell back asleep. Although on direct examination Robinson testified that when they reached appellant McNealy's home in Metter, he only got out of the automobile long enough to stretch his legs, on cross-examination he admitted that he and appellant Calhoun spent the night there. Finally, he testified at trial to the following: that during the few days he was with Calhoun, he never asked Calhoun spent the night there. Finally, he testified at trial to the following: that during the few days he was with Calhoun, he never asked Calhoun the location of the automobile that they went "up the street" to pick up; that he really never knew where he was, nor what Calhoun wanted him to do; and he did not know of the existence of the marijuana in the trunk.
The trial court charged the jury on parties to a crime and conspiracy. See OCGA §§ 16-4-8; 16-2-20. Conspiracy is a question for the jury. However, there must be some evidence to support its finding. See Brewer v. State, 129 Ga. App. 118 (199 SE2d 109) (1973).
"`"(P)resence, companionship, and conduct before and after the offense are circumstances from which one's participation in the criminal intent may be inferred." '[Cit.] `The evidence offered showed more than mere presence at the scene of the crime. Instead the proof sustained the [S]tate's contention that the defendant[s conspired to commit] the criminal [act.]' [Cits.]" Hardin v. State, 172 Ga. App. 232, 233 (322 SE2d 540) (1984). See generally Mize v. State, 173 Ga. App. 368 (2) (326 SE2d 785) (1985). Although appellant Robinson offered some explanation for his presence in the automobile when arrested, the jury was authorized to disbelieve that testimony and to infer from his presence and companionship with appellants McNealy and Calhoun that appellant Robinson's intent was to traffick in marijuana. Appellant Robinson was not merely present when the contraband was discovered. He had ridden to Metter, Georgia from Fort Lauderdale with appellant Calhoun, who the jury was authorized to find had constructive possession of the marijuana. He had then spent the night with his two co-defendants and traveled the following day to Augusta. The only explanation offered for his presence in the automobile was that, two days earlier, he thought that he was going "down the street" and had fallen asleep.
The evidence authorized the jury to find beyond a reasonable doubt that appellant Robinson had conspired with appellants Calhoun *774 and McNealy to traffick in marijuana. See generally Lang v. State, 171 Ga. App. 368, 369 (320 SE2d 185) (1984).
4. Accordingly, we find no error in the denial of appellants' respective motions for a directed verdict of acquittal.
Judgments affirmed. Birdsong, P. J., and Sognier, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3857399/ | Argued October 30, 1927.
This appeal presents the same questions, raised by identical assignments of error, involved in the case of Commonwealth v. Grove, in which an opinion has this day been filed, and for the reasons there stated, the judgment is reversed and a venire facias de novo awarded. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3857401/ | Argued September 24, 1945.
The defendant, with Donald Liniger, was charged with separate offenses of statutory burglary in six indictments, and with the larceny of an automobile in the seventh. Liniger pleaded guilty to all of them and the seven charges were consolidated for trial against this defendant. He was found guilty as indicated and was sentenced, concurrently, to one and one-half to three years on each conviction. Without objection from the Commonwealth, but one appeal was taken by defendant from seven judgments of sentence. We will consider the questions involved as though appeals were properly taken.
Except in the following respects the convictions must rest upon the testimony of Donald Liniger, the accomplice. The owner of the automobile testified that he saw two men steal it and he identified Liniger as one of them. Each of two owners testified that his cafe was broken into as charged, and whiskey and money taken. The chief of police examined each of six places, following complaints from the owners, and found evidence that all of them had been broken into. Proof of the corpus delicti in each case, therefore, does not rest wholly on the testimony of an accomplice. And it would be no objection if it did. The testimony of an accomplice may relate to any of the facts in issue including corpus delicti. 16 C.J., Criminal Law, § 1410, p. 690;Com. v. Fitzgerald, *Page 228 101 Pa. Super. 308; Com. v. Howe, 84 Pa. Super. 295.
Liniger testified that he and defendant committed the series of burglaries at the latter's suggestion. In his automobile Liniger drove defendant to the scene of the crime in each instance and acted as look-out while defendant entered the place. The day following each burglary, Liniger received his "cut" from the money or the proceeds of goods stolen. Liniger testified in detail as to defendant's part in each of the crimes, and his testimony, accepted by the jury, is sufficient to support the convictions. But it is contended that new trials must be granted from the failure of the trial judge to charge the jury as to the degree of caution to be exercised in weighing his uncorroborated testimony. Of course, a trial judge should warn the jury of the corrupt source of an accomplice's testimony (Com. v. McCloskey,273 Pa. 456, 461, 117 A. 192) but the form of instruction lies within the discretion of the court. Com. v. Robinson, 148 Pa. Super. 61, 24 A.2d 694; Com. v. Spadaro, 94 Pa. Super. 535,538. On the subject, the judge said in part: "Now, of course, it is for you to remember that a person who admits himself guilty of a crime, of what they call a crime of deceit, like burglary, something that is done at night, is not the best sort of a character, and you consider his story by character,
[i.e., in the light of his character], and that governs in yourconsideration of Liniger's story." (Emphasis ours). We think the charge in these cases meets the requirement in essentials. Cf.Com. v. Beck, 137 Pa. Super. 410, 9 A.2d 175; and Com. v.Bruno, 316 Pa. 394, 175 A. 518, which interprets the rule more liberally than any of our cases.
When Liniger in the presence of defendant was arraigned before a Justice of the Peace, on preliminary hearing, he admitted his guilt and charged the defendant with participation in all of the crimes. The defendant remained silent except to say "I have an attorney coming to speak in my defense." The court refused to *Page 229
strike out Liniger's statements implicating the defendant, but excluded this testimony as evidence of defendant's admission of guilty from silence (under the rule of Com. v. Vallone, 347 Pa. 419, 32 A.2d 889) by this statement: "I will state the fact that during the time another person is arraigned it is not the duty of the person who is not arraigned at that time to interrupt the proceedings . . . I will take care of the rest of that in my charge."
There was no duty on the defendant to speak out in response to accusations made in a judicial proceeding (Com. v. Zorambo,205 Pa. 109, 54 A. 716) and the trial judge in effect said so. He neglected to refer to the subject again in his charge. But he invited suggestions as to further instructions at the close of the charge and none were forthcoming. We find no fundamental error in the charge. Only a general exception was taken. Defendant having failed to request additional instructions on each of the subjects of his assignments of error, cannot now complain of mere inadequacies in the instructions as given. Com.v. Fickes, 105 Pa. Super. 199, 160 A. 142; Com. v. Mendola,294 Pa. 353, 144 A. 292.
The judgments are affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3859641/ | Argued October 14, 1929.
Plaintiff has judgment on a verdict for damage to its motorbus sustained in collision with defendant's motorbus at the intersection of Starr Avenue and Crescent Boulevard in Camden at about 6:30 A.M., October 27, 1927. According to this record, Starr Avenue is 40 feet wide, entering, but not crossing Crescent Boulevard; the boulevard is described as 100 feet wide, and extends north and south; Starr Avenue enters the boulevard, not at right angles, but by a northeast or southwest course.
We accept the verdict as establishing defendant's negligence, but the evidence also shows the contributory negligence of plaintiff's driver. He drove northeastward on Starr Avenue, intending to enter Crescent Boulevard, and to turn left and travel north toward Philadelphia. Driving on the right side of Starr Avenue, as he approached the intersection, he had ample opportunity, before he entered the boulevard, to look to his left (where the intersecting sides formed an oblique angle) for approaching traffic, but he did not look for it, when he should have done so, or, if he did, he disregarded what he should have seen — defendant's plainly approaching bus travelling southward through Camden.
There is some slight but immaterial variation in the driver's account of his conduct in driving from Starr Avenue into the boulevard. He states that he drove *Page 543
his bus half its length into the boulevard and then saw defendant's bus approaching only 75 feet away. He said "I had about 15 feet, about middleway of the bus, about 15 feet out on Crescent Boulevard, I seen this other bus coming down, and I stopped. He was coming down at a fast speed, and hit me in the left hand front wheel." Again, he states that "when I first seen him coming I started stopping right away, because I didn't want to get out in front of him ......;" he also says that he first saw the bus when his front wheels were crossing the curb line of the boulevard; that defendant's bus was travelling 50 miles an hour but that notwithstanding that speed it stopped in about 50 feet, and two or three feet from the left curb. On the driver's right, that is, at the southwest intersection of Starr Avenue and the boulevard, is a Sears-Roebuck department store, fronting on both streets; on the northwest corner, on the driver's left, there were no structures at the projected building line for a distance of 150 feet (this distance was given by witnesses for both sides) until an overhead bridge was reached, described as Federal Street and as the Pennsylvania Railroad bridge. There was therefore no obstacle to prevent his view of approaching traffic for that 150 feet plus such longer distance (not stated in the evidence) as the eye would see under the bridge constructed over this wide boulevard. Another witness called by plaintiff who was 200 feet south of Starr Avenue saw defendant's bus "coming under Federal Street bridge." Why did not plaintiff's driver see it then?
In entering the boulevard from Starr Avenue for the purpose of crossing the right or southbound lane of travel, it was his duty to look for approaching travel at the first opportunity; as there was nothing to interfere with his view to the left from Starr Avenue, he had that opportunity before he put the front of his *Page 544
bus out into the boulevard; it was also his duty to drive with his bus under such control as to enable him to stop before he put it within the line of collision with approaching southbound vehicles if their approach was reasonably to have been anticipated; he may have acted promptly in stopping his bus when he got into the main thoroughfare and saw the approaching bus 75 feet away, but by that time he had violated a plain legal duty prescribing how he should have driven from the narrow street into the wide one; and that breach of duty contributed to the collision; see generally Miller v. Transit Co., 62 Pa. Super. 568,570; Steinberg v. Transit Co., 87 Ibid 321, 324; Frank v. Pleet, 87 Ibid 494; Walker v. Transit Co., 95 Ibid 461; Mehler v. Doyle, 271 Pa. 492; Alperdt v. Paige, 292 Pa. 1.
While appellee agrees that its driver was in the boulevard when he first saw the approaching bus 75 feet away, it contends that there is no evidence that he did not look to the left for approaching traffic before that time. The law will not permit him to say that he looked where he had an unobstructed view without seeing what was approaching in plain view. Appellee also contends that "the fact that plaintiff's driver testified that defendant's bus was `coming down underneath the bridge' would indicate an up-grade in the boulevard on the far side [of the bridge], which, with the intervention of the bridge would create an additional bar of view from Starr Avenue." But there was a distance of 150 feet between the bridge and Starr Avenue, and he was on the right side of the avenue with an unobstructed view to his left while still within the lines of the avenue and yet did not see the bus until it was within 75 feet of him. There is no evidence that on the "far side" of the bridge there was any grade that would make the bridge an obstruction to the view; an inference of that fact cannot be made from the mere phrase `coming down underneath the bridge,' a statement, *Page 545
which, in the circumstances shown in the record, was a mere colloquial expression indicating southward travel. In the opinion refusing judgment n.o.v. the trial judge says: "The first opportunity he [plaintiff's driver] had of seeing the defendant's bus was when he reached the curb. Had he looked sooner he would not have been able to see it because of the grade at the point where the railroad crosses the boulevard." The evidence is that there was no obstruction to his view from the house line, nor is there any evidence of any grade unless it be inferred from the word `down': but even on that supposition it was the driver's duty to see the bus at least 150 feet away when it emerged from under the bridge, and at the speed at which he estimated that it was travelling, he must have known that he could not cross ahead of it without taking a risk that the prudent man would not take; he could not test an obvious danger without taking the risk. Concerning the matter of a descending grade on the far side of the bridge sufficient to make the bridge an obstruction to the view from Starr Avenue, it may be said that while an inference of fact may be made from evidence, the law does not tolerate inference or presumption from other inferences or presumptions: Bartolet v. McAdoo, 74 Pa. Super. 29, 33; Buck v. Cab Co., 75 Ibid 440, 443.
Judgment reversed and here entered for defendant. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3396843/ | Affirmed. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/166935/ | F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
January 18, 2006
FOR THE TENTH CIRCUIT Elisabeth A. Shumaker
Clerk of Court
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
v. No. 04-3273
(D.C. No. 02-CV-3409-SAC)
JAY DEE WALTERS, (D. Kan.)
Defendant-Appellant.
ORDER AND JUDGMENT *
Before KELLY, PORFILIO, and BRORBY, Circuit Judges.
After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument.
In 1999, Petitioner Jay Dee Walters (“Jay Dee” or “Mr. Walters”) and his
wife, Cheryl Walters, were indicted on various drug-related offenses. At their
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
trial, the jury deadlocked on the charges against Cheryl but convicted Jay Dee on
one of the counts returned in the superseding indictment: conspiracy to
manufacture and distribute in excess of one kilogram of a mixture or substance
containing a detectable amount of methamphetamine in violation of 21 U.S.C.
§§ 841 and 846. However, the jury did not make a finding as to the specific drug
quantity involved in the offense. Applying a “theoretical yield” calculation at
sentencing, the district court determined that 214 grams of methamphetamine
could have been manufactured given the estimated amount of precursors that
Mr. Walters and his wife had purchased for use by other members of the
conspiracy in the manufacturing process. The district court sentenced
Mr. Walters to 121 months’ imprisonment and a five-year term of supervised
release under § 841(b)(1)(C) and the United States Sentencing Guidelines
(“Federal Guidelines”). A panel of this court affirmed the conviction and
sentence on direct appeal on December 7, 2001. See United States v. Walters,
28 Fed. Appx. 902 (10th Cir. 2001) (unpublished).
Although Mr. Walters did not file a petition for a writ of certiorari with the
Supreme Court, he did file a timely motion pursuant to 28 U.S.C. § 2255 to
vacate, set aside, or correct his sentence. The district court denied the motion but
granted him a certificate of appealability (“COA”) on issues numbered five,
seven, and twelve in his COA application. In addition to these three issues, he
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has filed a renewed application for a COA in this court on nine other issues
(“Renewed COA Application”). Exercising jurisdiction under 28 U.S.C. §§ 1291
and 2253(a), we AFFIRM the denial of his § 2255 motion. We also GRANT his
motion to proceed in forma pauperis and DENY his Renewed COA Application
and his other pending motions.
I. General Legal Standards and Standards of Review.
A COA is a jurisdictional prerequisite to our review. Miller-El v. Cockrell,
537 U.S. 322, 336 (2003). Accordingly, we may consider only the issues certified
by the district court in its order granting a COA, plus any issues on which we
grant a COA.
“[W]e review the district court’s legal rulings on a § 2255 motion de novo
and its findings of fact for clear error.” United States v. Pearce, 146 F.3d 771,
774 (10th Cir. 1998). “Absent an intervening change in the law of a circuit,
issues disposed of on direct appeal generally will not be considered on a collateral
attack by a motion pursuant to § 2255.” United States v. Prichard, 875 F.2d 789,
791 (10th Cir. 1989). The intervening change in the law must be retroactively
applicable to cases on collateral review. See United States v. Price, 400 F.3d 844,
845 (10th Cir.) (denying petition for rehearing on ground that an intervening
change in the law by the Supreme Court was not retroactively applicable to an
initial § 2255 motion), cert. denied, 126 S. Ct. 731 (2005).
-3-
A petitioner also is barred from raising an issue in a § 2255 motion that he
failed to raise on direct appeal “unless he establishes either cause excusing the
procedural default and prejudice resulting from the error or a fundamental
miscarriage of justice if the claim is not considered.” United States v. Cox,
83 F.3d 336, 341 (10th Cir. 1996). The procedural default rule does not apply to
claims of ineffective assistance of counsel regardless of whether the claim could
have been raised on direct appeal. Massaro v. United States, 538 U.S. 500, 504
(2003). Thus, “[a] defendant may establish cause for his procedural default by
showing that he received ineffective assistance of counsel in violation of the
Sixth Amendment.” United States v. Cook, 45 F.3d 388, 392 (10th Cir. 1995).
To establish that counsel was ineffective, “a defendant must show that
(1) his counsel’s performance was constitutionally deficient, and (2) counsel’s
deficient performance was prejudicial.” Id. (citing Strickland v. Washington,
466 U.S. 668, 687 (1984)). To establish the first component, deficient
performance, a “defendant must show that counsel’s representation fell below an
objective standard of reasonableness.” Strickland, 466 U.S. at 688. We “indulge
a strong presumption that counsel’s conduct falls within the wide range of
reasonable professional assistance.” Id. at 689. To establish the second
component, prejudice, a “defendant must show that there is a reasonable
probability that, but for counsel’s unprofessional errors, the result of the
-4-
proceeding would have been different. A reasonable probability is a probability
sufficient to undermine confidence in the outcome.” Id. at 694.
The Strickland standard applies equally to ineffective assistance claims
concerning trial and appellate counsel. Cook, 45 F.3d at 392. “[I]n analyzing an
appellate ineffectiveness claim based upon the failure to raise an issue on appeal,
we look to the merits of the omitted issue.” Cargle v. Mullin, 317 F.3d 1196,
1202 (10th Cir. 2003) (quotation omitted). The omission of a meritless issue does
not constitute deficient performance. Id. “Whether a petitioner’s claim satisfies
Strickland’s two-part test is a mixed question of law and fact we review de novo.”
Bullock v. Carver, 297 F.3d 1036, 1044 (10th Cir. 2002).
“The incarceration of one actually innocent of the crime of which he has
been convicted constitutes a grave miscarriage of justice.” United States v.
Cervini, 379 F.3d 987, 991 (10th Cir. 2004). “There must be a showing that no
reasonable juror would have found the defendant guilty.” Id. (quotation omitted).
Because Mr. Walters appears pro se, we review his pleadings and other
papers liberally and hold them to a less stringent standard than those drafted by
attorneys. See Haines v. Kerner, 404 U.S. 519, 520 (1972); Hall v. Bellmon,
935 F.2d 1106, 1110 & n.3 (10th Cir. 1991).
II. Issues Presented in the District Court’s COA.
-5-
The district court certified three of the issues Mr. Walters presented in his
application for a COA: (1) counsel was ineffective by not arguing on direct
appeal that the government’s failure to prove the amount of methamphetamine
charged in the indictment, in excess of one kilogram, violated Apprendi v. New
Jersey, 530 U.S. 466 (2000), particularly in view of Blakely v. Washington,
542 U.S. 296 (2004); 1 (2) Mr. Walters’ Fifth Amendment due process rights and
his Sixth Amendment right to a jury trial were violated under Apprendi and
Blakely because the district court made drug quantity findings instead of the jury;
and (3) his Fifth Amendment right to due process and his Sixth Amendment rights
to notice of the nature and cause of the accusations against him and to a jury trial
were violated under Apprendi and Blakely because the indictment did not charge
the proper weight and the jury was not instructed to make a factual finding as to
drug quantity in its verdict. 2
1
In his application for a COA, Mr. Walters did not rely on United States v.
Booker, 543 U.S. 220, 125 S. Ct. 738 (2005), as the Supreme Court decided
Booker after the district court ruled on the application. However, Mr. Walters
addresses Booker in his briefs on appeal, and we consider it below.
2
We note that, as stated in Mr. Walters’ § 2255 motion and his application
for a COA, the second and third issues certified for appeal were not clearly
couched in terms of ineffective assistance of counsel. However, because they
involve variants of the first issue, which clearly alleges ineffective assistance of
counsel, we will consider the second and third issues to include a claim of
ineffective assistance of appellate counsel.
-6-
The district court considered these issues to be “thinly veiled recasts of the
Apprendi issues that the defendant unsuccessfully advanced on direct appeal” and
procedurally barred. R., Vol. I, doc. 307 at 24. The Apprendi argument raised on
direct appeal concerned whether, in the absence of a jury finding as to drug
quantity, the district court could impose a term of supervised release of five years
when 21 U.S.C. § 841(b)(1)(C) provided for a minimum term of three years.
Walters, 28 Fed. Appx. at 904. We concluded that Apprendi did not prevent the
district court from imposing the five-year term because the statute provided no
maximum term. Id. at 904-05. Although the reasoning we applied to that issue
compels the same conclusion on the Apprendi issues that form the predicate for
the ineffective assistance of counsel claims the district court certified, the
Apprendi issue raised on direct appeal is different from the Apprendi issues raised
in the § 2255 motion. Nevertheless, the new Apprendi issues are procedurally
barred because they could have been raised on direct appeal but were not. We
now turn to Mr. Walters’ attempt to overcome the procedural bar by alleging
ineffective assistance of counsel.
In Apprendi, the Supreme Court held that, “[o]ther than the fact of a prior
conviction, any fact that increases the penalty for a crime beyond the prescribed
statutory maximum must be submitted to a jury, and proved beyond a reasonable
-7-
doubt.” Apprendi, 530 U.S. at 490. Prior to the date on which Mr. Walters’
conviction became final, this circuit interpreted Apprendi as follows:
[T]he quantity of drugs involved in a violation of § 841 is an
essential element of the offense if that fact exposes the defendant to
a heightened maximum sentence under § 841(b)(1)(A) or (B). A
district court may not impose a sentence in excess of the maximum
set forth in 21 U.S.C. § 841(b)(1)(C) unless the benchmark quantity
. . . for an enhanced penalty is alleged in the indictment in addition to
being submitted to the jury and proven beyond a reasonable doubt.
United States v. Jones, 235 F.3d 1231, 1236 (10th Cir. 2000). The corollary of
this statement is that the quantity of drugs involved in a violation of § 841 is not
an essential element of the offense if a district court imposes a sentence that does
not exceed the maximum set forth in § 841(b)(1)(C), which does not require any
minimum quantity as a predicate for sentencing. Cf. United States v. Thompson,
237 F.3d 1258, 1262 (10th Cir. 2001) (holding that, “because the indictment set
forth all the necessary elements of a crime as defined by 21 U.S.C. § 841(a) and
21 U.S.C. § 846, and because the minimum statutory range [of § 841(b)(1)(C)]
. . . does not specify a drug amount, neither the indictment [which did not specify
any drug quantity] nor the conviction was defective” under Apprendi). Thus,
under Apprendi, a jury could determine that a defendant is guilty of a violation of
§ 841(a) even if the jury is unable to find a specific quantity or finds a quantity
less than that charged in the indictment. The district court then could impose any
sentence in accordance with the Federal Guidelines provided that the sentence did
-8-
not exceed the applicable statutory maximum set forth in § 841(b)(1)(C). This is
what happened in Mr. Walters’ case.
In Blakely, the Supreme Court considered the sentencing scheme of the
state of Washington and held that “the ‘statutory maximum’ for Apprendi
purposes is the maximum sentence a judge may impose solely on the basis of the
facts reflected in the jury verdict or admitted by the defendant.” Blakely,
542 U.S. at 303. After the district court issued its COA in this case, the Supreme
Court extended the rule in Blakely to the Federal Guidelines. See United States v.
Booker, 543 U.S. 220, 125 S. Ct. 738, 755 (2005). The Court held that “[a]ny
fact (other than a prior conviction) which is necessary to support a sentence
exceeding the maximum authorized by the facts established by a plea of guilty or
a jury verdict must be admitted by the defendant or proved to a jury beyond a
reasonable doubt.” Id. at 756.
Blakely and Booker, however, have no effect on Apprendi for purposes of
Mr. Walters’ § 2255 motion. Neither case applies retroactively to initial § 2255
motions that challenge convictions that became final prior to the effective dates
of those cases. See United States v. Bellamy, 411 F.3d 1182, 1184 (10th Cir.
2005); Price, 400 F.3d at 849. After we decided his direct appeal on December 7,
2001, Mr. Walters did not file a petition for a writ of certiorari. Therefore, his
conviction became final ninety days later, on March 7, 2001, long before June 24,
-9-
2004, the effective date of Blakely, or January 12, 2005, the effective date of
Booker. See Price, 400 F.3d at 846 (setting out method to determine finality of
conviction for retroactivity purposes); Sup. Ct. R. 13.1. (providing a ninety-day
period for filing a certiorari petition).
We are unpersuaded by Mr. Walters’ argument that Blakely and Booker
merely clarified Apprendi such that their retroactive applicability is irrelevant to
his § 2255 motion. Blakely created a new procedural rule. Price, 400 F.3d at
846. Because that rule is inapplicable to Mr. Walters’ § 2255 motion, id. at 845,
his conviction and sentence do not violate Apprendi. Additionally, Mr. Walters
relies mistakenly on United States v. Arras, 373 F.3d 1071 (10th Cir. 2004), and
United States v. Jackson, 240 F.3d 1245 (10th Cir. 2001), overruled on other
grounds by United States v. Prentiss, 256 F.3d 971, 981 (10th Cir. 2001) (en
banc) (per curiam). In each of those cases, we held that, under Apprendi, drug
quantity must be charged in the indictment if the court applies one of the
enhanced sentences of § 841(b)(1)(A) or (B). Arras, 373 F.3d at 1074; Jackson,
240 F.3d at 1248. Those cases did not involve a sentence under § 841(b)(1)(C).
Accordingly, because there is no merit to Mr. Walters’ underlying
arguments concerning the drug quantity charged in the indictment and the fact
that the district court determined drug quantity rather than the jury, we conclude
that counsel’s failure to raise these issues on direct appeal was not deficient
-10-
performance, see Cargle, 317 F.3d at 1202. For the same reason, it was not error
for the district court to fail to instruct the jury to make a drug quantity finding,
and counsel’s failure to raise that issue on direct appeal likewise is not deficient.
We also conclude that Mr. Walters’ Sixth Amendment right to notice of the
nature and cause of the accusations against him was not violated by the difference
between the drug quantity charged in the indictment, in excess of one kilogram,
and the quantity the district court ultimately calculated, 214 grams. “An
indictment is sufficient if it sets forth the elements of the offense charged, puts
the defendant on fair notice of the charges against which he must defend, and
enables the defendant to assert a double jeopardy defense.” United States v.
Dashney, 117 F.3d 1197, 1205 (10th Cir. 1997). As we have concluded that drug
quantity was not an element of the offense in this case, the indictment satisfied
the Sixth Amendment. 3
For the foregoing reasons, we affirm the district court’s denial of
Mr. Walters’ § 2255 motion on the issues certified for appeal.
3
We have also considered Mr. Walters’ “Memorandum of Fact to Clarify
Record,” in which he argues, inter alia, that the direct appeal panel erred in its
consideration of the district court’s ruling that his objections to the use of a
“theoretical yield” concept in calculating drug quantity were untimely. Ignoring
the procedural infirmities of this filing and assuming Mr. Walters is correct that
his objections were timely filed, we see no prejudice in the direct appeal panel’s
determination. That panel considered the gravamen of the objection he discusses
in the memorandum of fact, that the information on which the theoretical yield
was based was itself flawed, and rejected it. Walters, 28 Fed. Appx. at 907.
-11-
III. Issues Presented in Mr. Walters’ Renewed COA Application.
We review Mr. Walters’ Renewed COA Application in order to determine if
he “has made a substantial showing of the denial of a constitutional right.”
28 U.S.C. § 2253(c)(2). To meet this standard, he “must ‘sho[w] that reasonable
jurists could debate whether (or, for that matter, agree that) the [§ 2255] petition
should have been resolved in a different manner or that the issues presented were
adequate to deserve encouragement to proceed further.’” Miller-El, 537 U.S. at
336 (first alteration in original) (quoting Slack v. McDaniel, 529 U.S. 473, 484
(2000)) (further quotation omitted). When a district court denies a § 2255 motion
on procedural grounds and does not reach the underlying constitutional claim, a
petitioner must show that it is reasonably debatable “whether the petition states a
valid claim of the denial of a constitutional right and . . . whether the district
court was correct in its procedural ruling.” Slack, 529 U.S. at 484. Additionally,
“we may deny a COA if there is a plain procedural bar to habeas relief, even
though the district court did not rely on that bar.” Davis v. Roberts, 425 F.3d
830, 834 (10th Cir. 2005).
Although Mr. Walters is not required to prove the merits of the case in
order to obtain a COA, he “must prove something more than the absence of
frivolity or the existence of mere good faith.” Miller-El, 537 U.S. at 338
(quotations omitted). In evaluating whether he has satisfied his burden, we
-12-
perform “an overview of the claims . . . and a general assessment of their
merits. . . . This threshold inquiry does not require full consideration of the
factual or legal bases adduced in support of the claims. In fact, the statute forbids
it.” Id. at 336.
The first two issues Mr. Walters raises in the Renewed COA Application
are related: whether counsel rendered ineffective assistance by representing both
Mr. Walters and his wife, Cheryl, when they gave voluntary statements to the
Kansas Bureau of Investigation (“KBI”), and by failing to investigate facts prior
to permitting the interview. 4 The district court concluded that there was no
conflict because Mr. Walters and his wife shared a common coercion defense and
their statements did not conflict, and Mr. Walters provided no evidence showing
why counsel should have advised them not to cooperate with the KBI until he had
a chance to investigate.
4
Both Jay Dee and Cheryl were represented by the same attorney prior to and
at their trial. In his applications for a COA, Mr. Walters asserts that a conflict of
interest prevented counsel from calling Cheryl as a witness at trial to offer
evidence that would buttress the coercion defense or downplay Jay Dee’s role in
the conspiracy. He also asserts that the admission of Cheryl’s recorded statement
violated his Sixth Amendment confrontation clause rights because she did not
testify. However, he did not present these arguments to the district court in his
§ 2255 motion. Therefore, we do not consider them. See United States v. Mora,
293 F.3d 1213, 1216 (10th Cir. 2002) (applying “the general rule that we do not
address arguments presented for the first time on appeal” to an appeal from the
denial of a § 2255 motion).
-13-
When, as here, a defendant does not raise a potential conflict of interest in
the trial court, the mere possibility of conflict is insufficient to reverse a criminal
conviction; the defendant “must demonstrate that an actual conflict of interest
adversely affected his lawyer’s performance.” Cuyler v. Sullivan, 446 U.S. 335,
348 (1980). “‘[U]ntil . . . a defendant shows that his counsel actively represented
conflicting interests, he has not established the constitutional predicate for his
claim of ineffective assistance.’” Mickens v. Taylor, 535 U.S. 162, 175 (2002)
(quoting Cuyler, 446 U.S. at 350). “[T]o demonstrate an actual conflict of
interest, the petitioner must be able to point to specific instances in the record
which suggest an impairment or compromise of his interests for the benefit of
another party.” United States v. Alvarez, 137 F.3d 1249, 1252 (10th Cir. 1998)
(quotation omitted). “Without a showing of inconsistent interests, any alleged
conflict remains hypothetical, and does not constitute ineffective assistance.” Id.
Mr. Walters argues that his interests diverged from Cheryl’s interests
because he allegedly had a lower level of involvement in the conspiracy than she
did. He also argues that the coercion defense was “invalid otherwise the jury
would have ‘hung’ as to the petitioner as well.” Renewed COA Application at 3.
These arguments are unpersuasive. Even assuming that Cheryl was more involved
than Jay Dee, their interests were aligned in admitting to their respective levels of
involvement and presenting the coercion defense. Mr. Walters has pointed to no
-14-
specific instances of conduct by counsel that suggest the decision to present a
unified defense during the KBI interview was encumbered by a conflict of
interest. Therefore, he has not demonstrated an actual conflict that affected his
lawyer’s performance.
Mr. Walters also argues that, prior to his KBI interview, he met with his
attorney and explained his version of the facts. He contends that counsel’s failure
to investigate further prior to advising him to admit criminal conduct to the KBI
and pursue a coercion defense constitutes ineffective assistance of counsel. As
noted in Strickland:
The reasonableness of counsel’s actions may be determined or
substantially influenced by the defendant’s own statements or
actions. . . . [W]hen the facts that support a certain potential line of
defense are generally known to counsel because of what the
defendant has said, the need for further investigation may be
considerably diminished or eliminated altogether. And when a
defendant has given counsel reason to believe that pursuing certain
investigations would be fruitless or even harmful, counsel’s failure to
pursue those investigations may not later be challenged as
unreasonable.
Strickland, 466 U.S. at 691. Notably, Mr. Walters has not provided any of the
substance of the discussion he had with his attorney. Nor has he indicated what
information his attorney might have discovered or explained how such
information would have led to different advice. We conclude that Mr. Walters
has provided nothing that causes us to question the “strong presumption that
-15-
counsel’s conduct falls within the wide range of reasonable professional
assistance,” id. at 689, or that warrants further proceedings.
The third and fifth issues Mr. Walters raises are related: whether trial
counsel was ineffective in failing to object to the admission of evidence, in
particular evidence of a “stand off” with Billy Hill (a member of the conspiracy
who allegedly coerced Mr. Walters into participating) on the so-called “Wamsley
property” and of a methamphetamine lab found there. Mr. Walters claims this
evidence is irrelevant because he had nothing to do with the Wamsley operations.
He also asserts that counsel was ineffective for failing to raise the issues on
appeal. We agree with the district court that the underlying evidentiary issues are
procedurally barred because he should have raised them on direct appeal. We
also conclude that the issues lack merit. The evidence was relevant to
Mr. Walters’ role in the conspiracy because “[a] defendant need not have
knowledge of all the details or all the members of the conspiracy and may play
only a minor role in the conspiracy to incur liability.” United States v.
Mendoza-Salgado, 964 F.2d 993, 1005 (10th Cir. 1992) (quotation omitted).
Accordingly, any objection, and any appeal from the admission of such evidence,
would have been without merit. Therefore, counsel’s performance was not
deficient.
-16-
Mr. Walters’ fourth issue is that trial counsel was ineffective because he
did not permit Mr. Walters to testify at trial, allegedly misinforming him that the
decision was counsel’s to make, not Mr. Walters’ decision. The district court
ruled that Mr. Walters alleged sufficient details on the first prong of the
Strickland test to justify an evidentiary hearing but that none of his allegations
showed prejudice. The court noted that he provided only conclusory allegations
about what his testimony would have been, and the jury heard evidence on
coercion, including Mr. Walters’ own recorded statement to the KBI that he was
coerced. For substantially the same reasons, we agree with the district court that
Mr. Walters’ fourth issue lacks merit. Accordingly, counsel was not ineffective
in failing to raise it on direct appeal.
In his sixth issue, Mr. Walters contends that his sentence violated the Sixth
Amendment under Apprendi because it was based on classifying the
methamphetamine at issue under Schedule II (which is set forth in 21 U.S.C.
§ 812(c)) without it being charged as a Schedule II drug in the indictment and
without a finding by the jury that it was injectable. The district court considered
the merits of this claim and, relying on United States v. Zamora, 784 F.2d 1025
(10th Cir. 1986), concluded the law is clearly established that methamphetamine
is a Schedule II drug regardless of its injectability.
-17-
We conclude that this issue is procedurally barred because it should have
been raised on direct appeal. The default cannot be excused as either ineffective
assistance of counsel or a fundamental miscarriage of justice because
Mr. Walters’ argument has no merit under Zamora, where we noted that
methamphetamine was reclassified as a Schedule II drug in 1971:
21 U.S.C. § 811 . . . grants broad power to the Attorney General to
transfer drugs between schedules if he finds potential for abuse and
makes certain other findings. Pursuant to the aforesaid section, the
Attorney General did promulgate changes in Schedule II, to include
methamphetamine, its salts, isomers, and salts of isomers. 21 C.F.R.
§ 1308.12.
Zamora, 784 F.2d at 1030. Other courts have reached the same conclusion. See,
e.g., United States v. Macedo, 371 F.3d 957, 962 (7th Cir. 2004); United States v.
Gori, 324 F.3d 234, 240 (3d Cir. 2003); United States v. Segler, 37 F.3d 1131,
1133 (5th Cir. 1994); United States v. Kendall, 887 F.2d 240, 241-42 (9th Cir.
1989) (per curiam).
Mr. Walters’ seventh issue is that the government failed to inform the grand
jury of mitigating evidence concerning statements made by Mr. Walters and his
wife about Billy Hill’s violent proclivities. The district court noted the
government’s position that it was not aware of the coercion defense until
Mr. Walters and his wife made their statements to the KBI, which was after the
grand jury returned the indictment. The court concluded Mr. Walters had not
supplied any proof that the government discovered any substantial exculpatory
-18-
evidence and withheld it from the grand jury. The court also noted that, because
Mr. Walters’ coercion defense was unsuccessful at trial under a reasonable doubt
standard, there is little chance the defense would have deterred the grand jury
from returning an indictment under the probable cause standard. For substantially
the same reasons, we agree that there is no merit to this argument.
The eighth issue Mr. Walters raises is that his trial in federal court was an
abuse of prosecutorial discretion because the principal conspirators, who
allegedly had much greater involvement in the conspiracy, were tried in state
court. He also alleges that the court lacked jurisdiction over him because his role
in the conspiracy had no link to interstate commerce. The district court concluded
that Mr. Walters failed to state a viable constitutional claim on either ground
because he asserted no improper purpose on the part of the prosecutor in filing the
federal claim and his jurisdictional argument was frivolous. For substantially the
same reasons, we agree that Mr. Walters’ arguments have no merit.
In his ninth and final issue, Mr. Walters challenges the constitutionality of
21 U.S.C. §§ 841(a)(1) and 846, both as applied and facially, because his conduct
in the conspiracy did not affect interstate commerce and the statutes lack a
jurisdictional element requiring a link to interstate commerce. We agree with the
district court that there is no merit to Mr. Walters’ argument. What he fails to
grasp is that “[e]ven activity that is purely intrastate in character may be regulated
-19-
by Congress, where the activity, combined with like conduct by others similarly
situated, affects commerce among the States or with foreign nations.” Fry v.
United States, 421 U.S. 542, 547 (1975). Drug offenses are considered to
regulate a class of activities that necessarily affect interstate commerce. See
United States v. Janus Indus., 48 F.3d 1548, 1556 (10th Cir. 1995). Furthermore,
“the absence of formal findings concerning the effect on interstate commerce . . .
does not prevent Congress from regulating under the Commerce Clause.”
Id. (quotation omitted). We specifically have held that “§ 841(a)(1) and § 846 are
within Congress’ power to regulate interstate commerce.” United States v. Price,
265 F.3d 1097, 1107 (10th Cir. 2001). The statutes, therefore, are facially
constitutional. We also have held that, “[w]hen Congress enacts a statute under
its commerce power, it is not constitutionally obligated to require proof beyond a
reasonable doubt that each individual act in the class of activities regulated had
an effect on interstate commerce.” United States v. Lane, 883 F.2d 1484, 1492
(10th Cir. 1989). Accordingly, the government was not required to prove that
Mr. Walters’ conduct affected interstate commerce.
Based on the foregoing, we conclude that Mr. Walters has failed to make a
substantial showing of the denial of a constitutional right, and we deny his
Renewed COA Application.
IV. Denial of Mr. Walters’ Motion for an Evidentiary Hearing.
-20-
Mr. Walters also complains that the district court erred in denying his
claim that trial counsel had a conflict of interest without an evidentiary hearing.
A district court is required to conduct an evidentiary hearing “[u]nless the motion
and the files and records of the case conclusively show that the prisoner is
entitled to no relief.” 28 U.S.C. § 2255. We review the district court’s refusal to
hold an evidentiary hearing for an abuse of discretion. United States v. Clingman,
288 F.3d 1183, 1187 n.4 (10th Cir. 2002). Given that Mr. Walters has failed to
make a substantial showing that counsel was constitutionally ineffective, the
district court did not abuse its discretion in denying an evidentiary hearing.
Conclusion
For the foregoing reasons, we AFFIRM the district court’s denial of
Mr. Walters’ § 2255 motion. We also DENY his Renewed COA Application and
his motion for leave to file a supplemental brief, and we DISMISS the remainder
of this appeal. We GRANT his motion to proceed in forma pauperis and remind
-21-
him of his obligation under 28 U.S.C. § 1915(b) to make partial payments of the
filing fee until it is paid in full. Finally, we DENY his motions for appointment
of counsel.
Entered for the Court
Wade Brorby
Circuit Judge
-22- | 01-03-2023 | 08-14-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/4523630/ | Case: 19-10492 Document: 00515375831 Page: 1 Date Filed: 04/08/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
FILED
April 8, 2020
No. 19-10492 Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee
v.
BRANDI LEE BRADDOCK,
Defendant-Appellant
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 4:19-CV-161
Before HAYNES, GRAVES, and ENGELHARDT, Circuit Judges.
PER CURIAM:*
Brandi Lee Braddock, federal prisoner # 55980-177, pleaded guilty to
conspiring to possess with intent to distribute a “mixture and substance
containing a detectable amount of methamphetamine.” The district court
denied her 28 U.S.C. § 2255 motion on the merits without holding an
evidentiary hearing. Braddock now seeks a certificate of appealability (COA).
Braddock contends that her counsel provided ineffective assistance by
allowing her to be charged with “methamphetamine (actual)”; failing to argue
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
Case: 19-10492 Document: 00515375831 Page: 2 Date Filed: 04/08/2020
No. 19-10492
her objections to the Presentence Report; failing to ensure that she received
credit for time served in pretrial detention at the county jail; and failing to
object to her criminal history score. She also argues that the district court
erred by not holding an evidentiary hearing on her claims.
This court will grant a COA, which is required to appeal, only when the
movant “has made a substantial showing of the denial of a constitutional
right.” 28 U.S.C. § 2253(c)(2); see Slack v. McDaniel, 529 U.S. 473, 483-84
(2000). To make that showing, Braddock must “demonstrate that reasonable
jurists would find the district court’s assessment of the constitutional claims
debatable or wrong” or that the issues presented “deserve encouragement to
proceed further.” Slack, 529 U.S. at 484 (internal quotation marks and citation
omitted).
Braddock has not made the requisite showing. In addition, we will not
consider newly raised claims that were not presented to the district court. See
Henderson v. Cockrell, 333 F.3d 592, 605 (5th Cir. 2003). Braddock’s motion
for a COA is denied.
We construe the motion for a COA with respect to the district court’s
failure to hold an evidentiary hearing as a direct appeal of that issue, see
Norman v. Stephens, 817 F.3d 226, 234 (5th Cir. 2016), and affirm.
COA DENIED; AFFIRMED.
2 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3852482/ | Where a statute provides that "the shareholders of any corporation formed under this act shall be individually responsible . . . for all contracts, debts and engagements of such corporation to the amount of their stock therein at the par value thereof in addition to the par value of such shares" may a stockholder avoid said liability by the purchase of shares, the certificates for which provide they shall be fully paid and non-assessable, *Page 386
such purchase having been induced by the false representations of officers of the bank?
This is an action in assumpsit by the Secretary of Banking, Receiver of the Citizens Bank of Barnesboro, appellee, who took possession of the business and property of said bank on May 26, 1931, against Blair McAnulty, appellant, a stockholder in said bank, to recover a stock assessment in the amount of $4,700. All preliminary steps for the collection of a one hundred percent assessment against the shareholders were properly taken and demand duly made upon appellant for payment of the above sum. Liability is denied for the reason that the purchase of the stock was induced by the false representation of the bank officers that it was to be fully paid and non-assessable, and that the certificates of shares of stock so provided. This appeal is from the entry of judgment in the above sum with interest from June 20, 1935, for want of a sufficient affidavit of defense.
Where the legislature has, by definite and unequivocal language, determined the public policy of this Commonwealth with regard to a particular subject, that pronouncement cannot be set aside and rendered unenforceable by a contract between individuals: Commonwealth ex rel. Schnader v. KeystoneIndemnity Exchange, 338 Pa. 405, 412, and 335 Pa. 333, 336. The principle that a person for whose benefit remedial legislation has been enacted may waive the benefits thereof is inapplicable here. The purpose of the statute in question was to provide additional security for depositors and creditors of the banks created under the Act of 1876, P.L. 161, by making possible a one hundred percent assessment upon each share of bank stock. Provisions in agreements between the bank and subscribers or in certificates of shares of stock issued by the bank which are prohibited by or inconsistent with a statute cannot be set up as a defense to the payment of the obligation which the statute imposes. Cf. Commonwealth ex rel. Schnader v. KeystoneIndemnity Exchange, supra, 412. *Page 387
That the purchase of the shares was induced by fraudulent representations of officers of the bank cannot operate to prejudice the rights of depositors and other creditors of the bank. All legislation must be considered as intending to favor public interests, and where it conflicts with the interest of a private individual the latter must be subordinated to the former: Commonwealth ex rel. v. Sunbury School District,335 Pa. 6, 12. To sustain the principle for which appellant here contends would enable individuals to effectively remove themselves from the control of the legislature and make inoperative its numerous powers by the simple expediency of contract.
Judgment affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4554004/ | United States Court of Appeals
For the Eighth Circuit
___________________________
No. 18-2926
___________________________
Pharmaceutical Care Management Association
Plaintiff - Appellant
v.
Mylynn Tufte, in her official capacity as the State Health Officer of North Dakota;
Mark J. Hardy, in his official capacity as the Executive Director of the North
Dakota Board of Pharmacy; Steven P. Irsfeld, in his official capacity as President
of the North Dakota Board of Pharmacy; Wayne Stenehjem, in his official capacity
as the Attorney General of North Dakota
Defendants - Appellees
____________
Appeal from United States District Court
for the District of North Dakota - Bismarck
____________
Submitted: October 15, 2019
Filed: August 7, 2020
____________
Before SMITH, Chief Judge, GRUENDER and BENTON, Circuit Judges.
____________
GRUENDER, Circuit Judge.
This case concerns Pharmaceutical Care Management Association’s
(“PCMA”) claim that the Employee Retirement Income Security Act of 1974
(“ERISA”), 29 U.S.C. § 1001 et seq., and the Medicare Prescription Drug,
Improvement, and Modernization Act of 2003 (“Medicare Part D”), 42 U.S.C.
§ 1395w-101 et seq., preempt two sections of the North Dakota Century Code (the
“legislation”) regulating the relationship between pharmacies, pharmacy benefits
managers (“PBMs”), and other third parties that finance personal health services.
After PCMA and the State of North Dakota1 cross-moved for summary judgment,
the district court determined that only one provision in the legislation was preempted
by Medicare Part D and entered judgment in favor of North Dakota on the remainder
of PCMA’s claims. We affirm in part, reverse in part, and remand with directions
that judgment be entered in favor of PCMA.
PCMA is a national trade association that represents PBMs. PBMs are third-
party health plan administrators that manage prescription drug benefits on behalf of
health insurance plans. In this role, PBMs negotiate prescription drug prices with
drug manufacturers and pharmacies, create networks of pharmacies to fill
prescriptions for insured individuals, and process insurance claims when
prescriptions are filled.
In 2017, North Dakota passed N.D. Century Code sections 19-02.1-16.1 and
19.02.1-16.2, which, according to North Dakota, “sought to define the rights of
pharmacist[s] in relation to [PBMs], and to regulate certain practices by PBMs.” The
legislation regulates the fees PBMs and “third-party payer[s]” may charge
pharmacies, N.D. Cent. Code § 19-02.1-16.1(2); limits what copayments PBMs or
third-party payers may charge, id. § 19-02.1-16.1(4); dictates the quality metrics
PBMs and third-party payers may use to evaluate pharmacies and structures how
they may reward performance, id. §§ 19-02.1-16.1(3), (11), -16.2(4); prohibits,
subject to certain exceptions, PBMs from having “an ownership interest in a patient
assistance program and a mail order specialty pharmacy,” id. § 19.02.1-16.2(3);
1
PCMA sued Mylynn Tufte, State Health Officer of North Dakota, Mark
Hardy, Executive Director of the North Dakota Board of Pharmacy, Fran Gronberg,
President of the North Dakota Board of Pharmacy, and Wayne Stenehjem, Attorney
General of North Dakota, in their official capacities. Because of the nature of
PCMA’s claims, we refer to the defendants collectively as “North Dakota.”
-2-
regulates benefits provisions and plan structures, id. §§ 19-02.1-16.1(3), (4), (5) (8),
(9), (11), -16.2(5); and requires certain disclosures on the part of PBMs and prohibits
PBMs from setting limits on information pharmacists may provide patients, id. §§
19-02.1-16.1(6), (7), (10), -16.2(2). A PBM or third-party payer that violates any
section of the legislation is guilty of a class B misdemeanor. Id. §§ 19-02.1-
16.1(12), -16.2(6).
Shortly after the legislation’s enactment in 2017, PCMA filed a complaint
seeking a declaration of preemption and an injunction prohibiting the enforcement
of the legislation. At summary judgment, the district court determined that none of
the statutory provisions were preempted by ERISA and that only one of the
provisions was preempted by Medicare Part D. PCMA appeals, renewing its
argument that both ERISA and Medicare Part D preempt the entire legislation.
We review de novo the district court’s preemption and statutory interpretation
rulings. Pharm. Care Mgmt. Ass’n v. Rutledge, 891 F.3d 1109, 1112 (8th Cir. 2018).
With certain limited exceptions, ERISA preempts “any and all State laws insofar as
they may now or hereafter relate to any employee benefit plan.” 29 U.S.C. § 1144(a)
(emphasis added). “The breadth of this section is well known,” Rutledge, 891 F.3d
at 1112, and courts have struggled for decades to cabin its reach in order to prevent
the clause from becoming “limitless,” Gobeille v. Liberty Mut. Ins., 577 U.S. ---,
136 S. Ct. 936, 943 (2016); N.Y. State Conf. of Blue Cross & Blue Shield Plans v.
Travelers Ins., 514 U.S. 645, 655-56 (1995) (rejecting an “uncritical literalism” that
extends ERISA’s preemption clause to the “furthest stretch of its indeterminacy”);
see also Cal. Div. of Labor Standards Enf’t v. Dillingham Constr., N.A., Inc., 519
U.S. 316, 335 (1997) (Scalia, J., concurring) (counseling courts to avoid reading the
clause too broadly because, “as many a curbstone philosopher has observed,
everything is related to everything else”).
Endeavoring to clarify ERISA’s “unhelpful text,” Travelers Ins., 514 U.S. at
656, the Supreme Court has determined the clause preempts a state law that “relates
to” an ERISA plan by having an impermissible “reference to” or “connection with”
-3-
an ERISA plan, id. Here, we need not address the “connection with” element of the
analysis because we conclude the legislation is preempted due to its impermissible
“reference to” ERISA plans. See Pharm. Care Mgmt. Ass’n v. Gerhart, 852 F.3d
722, 730 (8th Cir. 2017) (“Where a State law is preempted because it has a prohibited
‘reference to’ ERISA or ERISA plans, we need not reach the question of whether it
is also preempted under the ‘connection with’ prong of the analysis.”).
A state law has an impermissible “reference to” ERISA plans where it
(1) “acts immediately and exclusively upon ERISA plans” or (2) “where the
existence of ERISA plans is essential to the law’s operation.” Gobeille, 136 S. Ct.
at 943. PCMA asserts that the legislation is preempted because it imposes
requirements by reference to ERISA plans through its definitions of “third-party
payers” and “plan sponsors.” According to PCMA, these references “ensure[] that
the existence of an ERISA plan triggers application” of the legislation’s provisions.
The district court disagreed, determining that, because the legislation also covers
entities that are not ERISA plans, it neither acts immediately and exclusively upon
ERISA plans nor does it make the existence of an ERISA plan essential to the
operation of the regulatory scheme. We agree with PCMA that the legislation is
preempted because its references to “third-party payers” and “plan sponsors”
impermissibly relate to ERISA benefit plans.
Sections 19-02.1-16.1 and -16.2 regulate “[p]harmacy benefits manger[s]”
and “[t]hird-party payer[s].” N.D. Cent. Code §§ 19-02.1-16.1(1), -16.2(1). They
then define a “[p]harmacy benefits manager” as “a person that performs pharmacy
benefits management . . . for a . . . third-party payer.” Id. § 19-03.6-01(4) (emphasis
added). “Third-party payer” is defined as “an organization other than the patient or
health care provider involved in the financing of personal health services.” Id. § 19-
03.6-01(6). This definition includes ERISA plans, which are necessarily “involved
in the financing of personal health services” and are distinct from “the patient or
health care provider.” See id.; 29 U.S.C. § 1002(1) (explaining that, for the purposes
of ERISA, an employee benefit plan is one that is established “for the purpose of
providing” “medical, surgical, or hospital care or benefits”). The legislation also
-4-
regulates “[p]lan sponsor[s],” which it defines as “the employer in the case of an
employee benefit plan established or maintained by a single employer, or the
employee organization in the case of a plan established or maintained by an
employee organization.” N.D. Cent. Code § 19-03.6-01(5) (emphasis added). This
definition is taken verbatim from ERISA, see 29 U.S.C. § 1002(16)(B), and these
“plan sponsors,” depending on their functions, may qualify as ERISA fiduciaries,
see id. § 1002(21)(A).
Two of our prior cases dictate that regulating by implicit reference to ERISA
plans results in preemption. First, in Gerhart, we determined that an Iowa statute
was preempted because it had a prohibited “reference to” ERISA. 852 F.3d at 729-
30. Although we found that the Iowa act at issue contained an “express reference”
to ERISA, see id. at 729, we also noted that “the Iowa law . . . makes implicit
reference to ERISA through regulation of PBMs who administer benefits for
‘covered entities,’ which, by definition, include health benefit plans and employers,
labor unions, or other groups ‘that provide[] health coverage,’” id. (emphasis added).
We explained that because “[t]hese entities are necessarily subject to ERISA
regulation,” the requirements “necessarily affect[] ERISA plans,” and, as a result,
the Iowa law contained an “impermissible reference to” ERISA. Id. at 729-30.
One year later, in Rutledge, we followed this reasoning in evaluating an
Arkansas statute that was “similar in purpose and effect” to the Iowa law at issue in
Gerhart. See Rutledge, 891 F.3d at 1112. There, we determined the Arkansas law
contained an impermissible “reference to” ERISA plans, see id. at 1112-13, because
the challenged law regulated PBMs that administered a “pharmacy benefits plan or
program,” see Ark. Code. Ann. § 17-92-507(a)(7) (2017), which in turn was defined
as any plan or program that “pays for . . . pharmacist services,” id. § 17-92-507(a)(9).
We concluded the Arkansas law “implicitly referred to ERISA by regulating the
conduct of PBMs administering or managing pharmacy benefits” on behalf of
ERISA plans. See Rutledge, 891 F.3d at 1112.
-5-
As in Gerhart and Rutledge, so too here. The North Dakota legislation’s
definitions of and references to “pharmacy benefits manager,” “third-party payer,”
and “plan sponsor” mean the legislation’s provisions apply to plans “subject to
ERISA regulation.” Id. “Because benefits affected by [the statute] are provided by
ERISA-covered programs, the requirements imposed for the management and
administration of these benefits necessarily affects ERISA plans.” Gerhart, 852
F.3d at 729. Thus, the existence of an ERISA plan is essential to the law’s operation
because “it cannot be said that the . . . law functions irrespective of the existence of
an ERISA plan.” Id. at 729-30 (internal quotation marks, ellipses, and brackets
omitted).
As the State of Arkansas did in Rutledge, North Dakota argues that Gerhart
should be limited to its consideration of the Iowa law’s “express reference” to
ERISA plans and that Gerhart’s “implicit reference” analysis is dicta inconsistent
with Supreme Court precedent. 2 But we have already rejected this argument.
Rutledge, 891 F.3d at 1112 (“The state argues that Gerhart should be limited to its
consideration of the Iowa Act’s ‘express reference’ to ERISA, and that Gerhart’s
‘implicit reference’ analysis is dicta inconsistent with Supreme Court precedent. We
disagree.”). Instead, Gerhart and Rutledge control, and a statute that implicitly
regulates ERISA plans as part of its regulatory scheme is preempted by ERISA and
2
Citing Dillingham Construction, 519 U.S. at 325, North Dakota argues that
our cases construing the scope of ERISA’s preemption clause conflict with Supreme
Court precedent. The State suggests that if a law regulates a class of third-party
administrators or claim processors whose customers merely include but are not
limited to ERISA plans, it logically follows that the law does not act immediately
and exclusively upon ERISA plans and that the existence of ERISA plans is not
essential to the law’s operation. See also Pharm. Care Mgmt. Ass’n v. District of
Columbia, 613 F.3d 179, 189-90 (D.C. Cir. 2010) (reasoning similarly); Pharm.
Care Mgmt. Ass’n v. Rowe, 429 F.3d 294, 304 (1st Cir. 2005) (same). The Supreme
Court recently granted a writ of certiorari in Rutledge, 589 U.S. ---, 140 S. Ct. 812
(2020) (mem.), to resolve this question. But regardless of whether Gerhart and
Rutledge were rightly decided, we are bound by those panel decisions unless they
are abrogated by the Supreme Court or overruled by this circuit sitting en banc. See
Mader v. United States, 654 F.3d 794, 800 (8th Cir. 2011) (en banc).
-6-
cannot be saved merely because the reference also includes entities not covered by
ERISA. See id. (rejecting Arkansas’s argument that “we are not completely bound
by” the Gerhart panel’s reasoning).
Accordingly, the North Dakota legislation is preempted because it “relates to”
ERISA plans “by regulating the conduct of PBMs administering or managing
pharmacy benefits.” See Rutledge, 891 F.3d at 1112; see also Metro. Life Ins. v
Massachusetts, 471 U.S. 724, 739 (1985) (“Even indirect state action bearing on
private pensions may encroach upon the area of exclusive federal concern.”
(brackets omitted)); Express Scripts, Inc. v. Wenzel, 262 F.3d 829, 833 (8th Cir.
2001) (“State laws that are not targeted at ERISA plans, but which indirectly force
a plan administrator to make a particular decision or take a particular action may be
held to ‘relate to’ employee benefit plans.”).
Next, North Dakota urges in a footnote at the end of its argument regarding
ERISA preemption that, if we find the legislation to be preempted, we should
“remand for a determination of which provisions are saved from preemption under
ERISA’s Savings Clause.” The district court did not address this issue and North
Dakota provides no argument as to which provisions might be saved by the savings
clause. See 29 U.S.C. § 1144(b)(2)(A). We therefore conclude that North Dakota
has waived this issue. See Mahler v. First Dakota Title Ltd. P’ship, 931 F.3d 799,
807 (8th Cir. 2019) (finding an issue waived where plaintiff mentioned it only in
passing and did not include the issue in the statement of issues); Hamilton v.
Southland Christian Sch., Inc., 680 F.3d 1316, 1318-19 (11th Cir. 2012) (holding
that appellee’s failure to raise an affirmative defense on appeal waives any right to
claim such a defense on appeal).
-7-
For the reasons above, we affirm in part, reverse in part, and remand with
directions to enter judgment in favor of PCMA.3
______________________________
3
North Dakota does not cross-appeal the district court’s determination that
Medicare Part D preempts North Dakota Century Code section 19-02.1-16.2(2).
And because Gerhart and Rutledge dictate that ERISA preempts the North Dakota
legislation in its entirety, we need not address that determination. See Duffner v.
City of St. Peters, 930 F.3d 973, 976 (8th Cir. 2019) (noting that “[w]e may affirm
on any ground supported by the record”).
-8- | 01-03-2023 | 08-07-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4554007/ | United States Bankruptcy Appellate Panel
For the Eighth Circuit
___________________________
No. 20-6005
___________________________
In re: Fansteel Foundry Corporation
Debtor
------------------------------
Daniel Dooley, Trustee of the WDC Liquidation Trust
Plaintiff - Appellee
v.
Luxfer MEL Technologies
Defendant - Appellant
____________
Appeal from United States Bankruptcy Court
for the Southern District of Iowa - Des Moines
____________
Submitted: July 8, 2020
Filed: August 7, 2020
____________
Before SALADINO, Chief Judge, SCHERMER and SANBERG, Bankruptcy
Judges.
____________
SCHERMER, Bankruptcy Judge
Luxfer MEL Technologies (Luxfer) appeals the bankruptcy court’s decision
that payments to Luxfer were not protected by the ordinary course of business
defense to a preference action. We have jurisdiction over this appeal from the final
judgment of the bankruptcy court. See 28 U.S.C. § 158(b). For the reasons that
follow, we remand.
ISSUE
The issue on appeal is whether the bankruptcy court properly determined that
preference payments did not qualify for the ordinary course of business defense.
Because we cannot make this determination without additional explanation from the
bankruptcy court, we remand this matter to the bankruptcy court.
BACKGROUND
On September 13, 2016, Fansteel Foundry Corporation f/k/a Wellman
Dynamics Corporation (Debtor) filed a voluntary petition for relief under Chapter
11 of the Bankruptcy Code. Within 90 days of the bankruptcy filing, the Debtor
made 27 payments to Luxfer totaling $2,529,733.82. It was undisputed that Luxfer’s
services were essential to the Debtor’s operations.
Daniel Dooley, Trustee of the WDC Liquidation Trust (Trustee), is the
plaintiff in this litigation seeking to avoid as preferences and recover payments made
within 90 days of the Debtor’s filing of its bankruptcy petition. Luxfer raised two
affirmative defenses: (1) new value; and (2) ordinary course of business. After trial,
the Trustee conceded that new value in the amount of $1,847,623.62 could be
credited against the preference payments received by Luxfer. The bankruptcy court
entered judgment in favor of the Trustee for the difference ($2,529,733.82 less
$1,847,623.62), $682,110.20, plus interest.
STANDARD OF REVIEW
“We review the bankruptcy court’s findings of fact for clear error and
conclusions of law de novo.” Official Plan Comm. v. Expeditors Int’l of Wash., Inc.
(In re Gateway Pac. Corp.), 153 F.3d 915, 917 (8th Cir. 1998) (citation omitted).
2
“A finding is ‘clearly erroneous' when although there is evidence to support it, the
reviewing court on the entire evidence is left with the definite and firm conviction
that a mistake has been committed.” Lovett v. St. Johnsbury Trucking, 931 F.2d 494,
500 (8th Cir.1991) (quoting United States v. United States Gypsum Co., 333 U.S.
364, 395 (1948)).
DISCUSSION
“In general, an avoidable preference is a transfer of the debtor's property, to
or for the benefit of a creditor, on account of the debtor's antecedent debt, made less
than ninety days before bankruptcy while the debtor is insolvent, that enables the
creditor to receive more than it would in a Chapter 7 liquidation.” Cox v. Momar
Inc. (In re Affiliated Foods S.W. Inc.), 750 F.3d 714, 717 (8th Cir. 2014) (citing 11
U.S.C. § 547(b)). Luxfer does not dispute that the Trustee made his prima facie case
of establishing a preference. See 11 U.S.C. §547(g) (“[T]he trustee has the burden
of proving the avoidability of a transfer under subsection (b) of [§547].”).
The ordinary course of business defense is found in Bankruptcy Code
§547(c)(2) which prohibits a trustee from avoiding transfers found to be preferences:
(2) to the extent that such transfer was in payment of a debt incurred by
the debtor in the ordinary course of business or financial affairs of the
debtor and the transferee, and such transfer was—
(A) made in the ordinary course of business or financial affairs
of the debtor and the transferee; or
(B) made according to ordinary business terms;
11 U.S.C. §547(c)(2). “The creditor must prove that the transfer either was made in
the ‘ordinary course of [its] business’ with the debtor, or that it was made ‘according
to ordinary business terms.’ ” Affiliated Foods S.W. Inc., 750 F.3d at718 (emphasis
3
and alteration in original). 1 “[T]he creditor or party in interest against whom
recovery or avoidance is sought has the burden of proving the nonavoidability of a
transfer under subsection (c) of [§547].” 11 U.S.C. §547(g).
“There is no precise legal test which can be applied in determining whether
payments by the debtor during the 90-day period were made in the ordinary course
of business; rather, the court must engage in a peculiarly factual analysis.” Gateway
Pac. Corp., 153 F.3d at 917 (quoting Lovett, 931 F.2d at 497) (citation and quotation
marks omitted). “[T]he cornerstone of this element of a preference defense is that
the creditor needs [to] demonstrate some consistency with other business
transactions between the debtor and the creditor.” Lovett, 931 F.2d at 497 (citation
and quotation marks omitted). As stated by the Eighth Circuit:
Other factors may be relevant in a particular case, such as whether the
preferential transfer involved an unusual payment method or resulted
from atypical pressure to pay. But when those factors are absent, . . . .
the analysis focuses on the time within which the debtor ordinarily paid
the creditor's invoices, and whether the timing of the payments during
the 90–day [preference] period reflected ‘some consistency’ with that
practice.
Affiliated Foods S.W. Inc., 750 F.3d at 719 (internal citations and quotation marks
omitted). “When late payments were the standard course of dealing between the
parties, they are also the ordinary course of business during the preference period.”
Gateway Pac. Corp., 153 F.3d at 917.
The 90 day preference period was from June 15, 2016 to September 12, 2016.
The time within which the debtor ordinarily paid the creditor’s invoices prior to the
preference period is referred to as the “baseline period.” The bankruptcy court
appropriately adopted the Trustee’s baseline period of June 1, 2012 through May 31,
1
The Trustee does not dispute that the transfer was “in payment of a debt incurred
by the debtor in the ordinary course of business or financial affairs of the debtor and
the transferee.” 11 U.S.C. §547(c)(2).
4
2015. “To make a sound comparison, ‘[n]umerous decisions support the view that
the historical baseline should be based on a time frame when the debtor was
financially healthy.’ ” Affiliated Foods S.W., Inc., 750 F.3d at 720 (quoting Davis
v. R.A. Brooks Trucking, Co., Inc. (In re Quebecor World (USA), Inc.), 491 B.R.
379, 387 (Bankr.S.D.N.Y.2013)). Luxfer proposed to the bankruptcy court a
baseline period of April 2015 through July 2016, a time that includes approximately
45 days of the preference period. The proposed baseline period by Luxfer would
make it impossible to compare the preference and baseline periods.
The bankruptcy court then appropriately compared the average time from the
date of invoice to payment during the baseline and preference periods. The parties
agree with the bankruptcy court’s factual determination that during the preference
period the average days from invoice to payment increased by 40 percent from the
baseline average (from an average payment of 43 days from date of invoice during
the baseline period to an average payment of 60 days from the date of invoice during
the preference period).
Our difficulty with the bankruptcy court’s decision is that it did not further
identify its reasoning for holding that transfers in the amount of $682,110.20 were
not made in the ordinary course. The court stated that the Trustee’s analysis
provided a balanced approach and that it relied on the Trustee’s determination that
payments were made in the ordinary course if they were made 47 days or less after
the invoice date. 2 The court did not explain why it adopted 47 days as the cut-off
period or how it arrived at that number. The increase from the average time for
payment during the baseline period of 43 days to the 47-day mark used by the
bankruptcy court resulted in only 9 percent difference. It seems improbable that an
increase of time for payment of only 9 percent would be sufficient to set the cut-off
for ordinary and non-ordinary course transactions. This is particularly questionable
when the time to payment for the 27 preferential payments had a range of 53 to 69
2
In a footnote, the bankruptcy court stated that based on the dates when Luxfer
received payments, the cut-off number was actually 52 days. It is unclear what the
52-day number signifies and how it related to the baseline period.
5
days. None of the preference payments were made as quickly as 47 days, the length
of time chosen by the trial court as the cut-off of ordinary course payment.
Accordingly, since all 27 preference payments took longer than 47 days, none of
them qualified as ordinary course payments. We doubt that an increase in the
average length to payment of only 4 days (from 43 days during the baseline period
to 47 days in the preference period) is substantial enough to take all 27 payments out
of the ordinary course.
If, for example only, the court had determined 63 days was the cut-off
(ordinary course) the increase of time to payment during the preference period would
be from 43 days to 63 days in the preference period, demonstrating a significant
change in the ordinary course dealings. Instead of a 9 percent difference there would
be a 46 percent change from the baseline period.
According to Luxfer, the bankruptcy court erred because it did not apply a
“peculiarly factual analysis” and it instead applied a precise legal test requiring only
an “all math” analysis. Luxfer points to a four-factor test for determining ordinary
course and argues that the bankruptcy court erred because it considered only the
timing of payment. The Eighth Circuit has never adopted the four-factor test. But
even in cases applying the four-factor test, “there is a general focus upon one of the
factors and, if any one of the factors is compellingly inconsistent with prior
transactions, the payment is deemed to be outside of the ordinary course of business
between the parties.” Concast Canada, Inc. v. Laclede Steel Co. (In re Laclede Steel
Co.), 271 B.R. 127, 131-132 (B.A.P. 8th Cir. 2002) (emphasis in original), aff’d 47
Fed. Appx. 784 (8th Cir. 2002) (per curiam) (unpublished)).
The focus of Luxfer’s position is that the bankruptcy court failed to consider
the change in invoice terms from 30 to 45 days in April 2015, before the preference
period. We disagree. The court found that Luxfer imposed different payment terms
during the parties’ relationship, depending on creditworthiness, and it pointed to
testimony from the record supporting its statement that the change in terms was
irrelevant to the analysis because it was “less about its customary dealings with [the
6
Debtor] and more about Luxfer’s efforts to increase its income stream.” Dooley v.
Luxfer MEL Tech. (In re Fansteel Foundry Corp.), Case No. 16-01825, Adv. No,
18-30042, slip op. at 5 (Bankr. S.D. Iowa Feb. 14, 2020). 3 Luxfer concedes that
there was no change in the payment method or unusual collection activity during the
preference period. We see no error by the court in focusing on the timing of
payment. See, e.g., Affiliated Foods S.W. Inc., 750 F.3d 714 (when other factors are
absent, court focuses on consistency in time of payments); Gateway Pac. Corp., 153
F.3d 915 (court disagreed with argument that other consistencies in relationship were
sufficient to overcome evidence of significant change in payment); Lovett, 931 F.2d
494 (court focused on timing of payments and found unpersuasive other grounds
relied upon by bankruptcy court for decision that payments were not ordinary
course); Laclede Steel Co., 271 B.R. 127 (excruciating lateness of payments
outweighed relevance of other consistencies).
Relying on Federal Rule of Bankruptcy Procedure 8014(f), Luxfer submitted
to us a letter citing The Official Unsecured Creditors Comm. of Pester Refining Co.
v. Blackburn, Inc. (In re Pester Refining Co.), No. 87-0187, 1989 WL 1684542
(Bankr. S.D. Iowa May 31, 1989). Luxfer believes that case supports its argument
that “when parties execute a new agreement prior to the preference period, but within
the lookback period, the court should consider the new agreement as evidence
establishing a new ordinary course of business between the parties.” Rule 8014(f)
concerns submission of “pertinent and significant authorities” that “come to a party’s
attention after the party’s brief has been filed--or after oral argument but before a
decision.” FED. R. BANKR. P. 8014(f). Pester Refining Co. is neither pertinent nor
significant.
Pester Refining Co. is not pertinent authority because it is factually distinct.
The payment terms in Pester Refining Co. changed during the preference period, but
Luxfer changed the Debtor’s payment terms before the preference period. In re
3
It is also not clear how the invoice terms could change the result when the parties
never abided by those terms.
7
Pester Refining Co., 1989 WL 1684542 at *1-2. And Luxfer and the Debtor changed
only the time for payment of an invoice (45 days instead of 30), but the Pester
Refining Co. “new agreement” also changed the required payment method to wire
transfer instead of check and required the debtor to pay a finance charge on past-
due invoices. Id. at 2.
Pester Refining Co. is also not significant authority. It is a 1989 non-binding
trial level decision. Luxfer cites Pester Refining Co. for its agreement generally with
the proposition from other cases that ordinary course may be established where the
parties enter a new agreement prior to the preference period and then make payments
pursuant to that agreement. Id. at *7. Importantly, Pester Refining Co. does not
support Luxfer’s position because the Debtor did not make payment to Luxfer in
accordance with the new invoice terms. And the discussion of cases involving
changes in payments prior to the preference period in Pester Refining Co. was dicta
because the payment terms in Pester Refining Co. changed during the preference
period and the court held that the parties’ agreement was “not a valid ‘new
agreement.’ ” Id.
Luxfer also claims that we may rule in its favor on the §547(c)(2)(B) defense
(“transfer was . . . made according to ordinary business terms”) without a remand.
11 U.S.C. §547(c)(2)(B). As Luxfer pointed out, the bankruptcy court’s decision
did not address the §547(c)(2)(B) defense. We do not address this argument by
Luxfer because it was not properly raised before us. Luxfer made this argument only
in a footnote in its opening brief and in its reply brief in response to the Trustee’s
arguments.
CONCLUSION
For the reasons stated, we remand this matter to the bankruptcy court to set
forth the method by which it adopted 47 days as the ordinary course cut-off or,
alternatively, determine which preferential transfers were made in the ordinary
course. In addition, the adversary complaint seeks not only avoidance of preferential
transfers under Bankruptcy Code §547, but also recovery under Bankruptcy Code
8
§550. Separately, the bankruptcy court’s decision did not address recovery under
§550. On remand, the bankruptcy court should determine the Trustee’s entitlement
to recovery under §550.
_________________________________
9 | 01-03-2023 | 08-07-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523635/ | Case: 19-10314 Document: 00515375622 Page: 1 Date Filed: 04/08/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
No. 19-10314
Fifth Circuit
FILED
April 8, 2020
RHEASHAD LAMAR LOTT, Lyle W. Cayce
Clerk
Plaintiff-Appellant
v.
E. OSEGUERA; JOHN BRIMMER,
Defendants-Appellees
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 3:19-CV-126
Before JONES, HIGGINSON, and OLDHAM, Circuit Judges.
PER CURIAM: *
Rheashad Lamar Lott, Texas prisoner # 1596571, moves for leave to
proceed in forma pauperis (IFP) following the dismissal of his 42 U.S.C. § 1983
complaint in which he alleged that Grand Prairie Police Department detectives
falsely arrested him without a valid warrant and without probable cause. The
district court sua sponte dismissed the complaint under 28 U.S.C.
§§ 1915(e)(2)(B) and 1915A(b) based on a determination that it was not timely
filed. We construe Lott’s motion as a challenge to the district court’s
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
*
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
Case: 19-10314 Document: 00515375622 Page: 2 Date Filed: 04/08/2020
No. 19-10314
certification that the appeal is not taken in good faith. See Baugh v. Taylor,
117 F.3d 197, 202 (5th Cir. 1997).
Lott does not challenge the applicability of a two-year limitations period;
nor does he deny that the alleged false arrest occurred in May 2008 and that
his § 1983 complaint was filed in January 2019. Instead, he maintains that he
is entitled to equitable tolling of the limitations period because he did not know
of the existence of the cause of action until his attorney produced the State’s
file in November 2017. Lott, however, has failed to establish that he actively
pursued his judicial remedies or otherwise acted diligently. See Wallace v.
Kato, 549 U.S. 384, 394-96 (2007); Lawrence v. Florida, 549 U.S. 327, 336
(2007); Hand v. Stevens Transp., Inc. Emp. Benefit Plan, 83 S.W.3d 286, 293
(Tex. App. 2002). The district court therefore did not err or abuse its discretion
in dismissing Lott’s complaint as frivolous because it is time barred.
This appeal lacks arguable legal merit and is, therefore, frivolous. See
Howard v. King, 707 F.2d 215, 220 (5th Cir. 1983). Lott’s motion to proceed
IFP is DENIED, and we DISMISS his appeal as frivolous. See Baugh, 117 F.3d
at 202 n.24; 5TH CIR. R. 42.2.
The district court’s dismissal of the complaint and this court’s dismissal
of his appeal as frivolous count as two strikes under § 1915(g). See Coleman v.
Tollefson, 135 S. Ct. 1759, 1763-64 (2015); Adepegba v. Hammons, 103 F.3d
383, 388 (5th Cir. 1996). A prior § 1983 action filed by Lott was dismissed as
frivolous and for failure to state a claim pursuant to § 1915(e). See Lott v.
Director, TDCJ-CID, No. 1:17-cv-528 (E.D. Tex. Sept. 13, 2018). That
dismissal also counts as a strike under § 1915(g). See Adepegba, 103 F.3d at
387-88. Because he now has three strikes, Lott is BARRED from proceeding
IFP in any civil action or appeal filed in a court of the United States while he
is incarcerated or detained in any facility unless he is under imminent danger
2
Case: 19-10314 Document: 00515375622 Page: 3 Date Filed: 04/08/2020
No. 19-10314
of serious physical injury. See § 1915(g); Brewster v. Dretke, 587 F.3d 764, 770
(5th Cir. 2009).
3 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/615680/ | 661 F.3d 225 (2011)
UNITED STATES of America, Plaintiff-Appellee,
v.
Hugo Elio SARABIA, Jr., Defendant-Appellant.
No. 10-40125.
United States Court of Appeals, Fifth Circuit.
October 20, 2011.
*227 Amy Howell Alaniz (argued), Asst. U.S. Atty., McAllen, TX, James Lee Turner, Asst. U.S. Atty., Houston, TX, for Plaintiff-Appellee.
Fabian Guerrero (argued), Law Office of Fabian Guerrero, Edinburg, TX, for Defendant-Appellant.
Before JOLLY, DeMOSS and PRADO, Circuit Judges.
PRADO, Circuit Judge:
This case concerns whether a jury's acquittal of a defendant on one count of conspiracy to possess with the intent to distribute marijuana necessarily required determining a fact that would prevent retrying the defendant for possession with the intent to distribute marijuana. After Hugo Sarabia Jr. (Sarabia) was acquitted by a jury of one count of conspiracy to possess with the intent to distribute marijuana, the Government sought to retry him on an additional possession count on which the jury could not reach a verdict. Sarabia argues that the jury's decision to acquit him on the conspiracy charge necessarily means that the jury decided that he was not the person driving a recreational vehicle (RV) containing over 1,000 pounds of marijuana, and thus that he was not in possession of the marijuana. He claims that double jeopardy bars his retrial on the possession charge under principles of issue preclusion, because the Government would need to prove that he drove the RV in order to convict him of the possession *228 charge. Alternatively, Sarabia argues that retrial on the possession charge is barred by double jeopardy because possession is a lesser-included offense of conspiracy to possess. The district court denied Sarabia's motion to dismiss the indictment for double jeopardy. We affirm.
I. BACKGROUND
On March 16, 2004, the Government indicted Sarabia on the following drug-related crimes: (1) conspiracy to possess with the intent to distribute more than 1,000 kilograms of marijuana in violation of 21 U.S.C. §§ 846, 841(a)(1) and (b)(1)(A) (Count One); (2) possession with intent to distribute 898 kilograms of marijuana in violation of 21 U.S.C. § 841(a)(1), (b)(1)(B) and 18 U.S.C. § 2 (Count Two); (3) possession with intent to distribute 458 kilograms of marijuana in violation of 21 U.S.C. § 841(a)(1), (b)(1)(B) and 18 U.S.C. § 2 (Count Three); and (4) conspiring to launder proceeds of unlawful activity in violation of 18 U.S.C. § 1956(a)(1)(A)(i), (h) (Count Four). The Government also indicted Sarabia's father, Hugo Sarabia Sr. (Senior), on Counts One, Three, and Four; Sarabia's brother, Leonel Sarabia (Leonel), on all four counts; and another alleged associate, Honecimo Rodriguez, on Counts One and Three. Leonel pleaded guilty to the conspiracy count prior to trial and testified at the trial of Sarabia and Senior.
The Government jointly tried Sarabia and Senior in a seven-day trial beginning on January 20, 2009. Just prior to the close of evidence, the district court granted Sarabia's motion for judgment of acquittal on Count Four, the money-laundering count. The jury acquitted Sarabia of Count One (the conspiracy count) and Count Two (one of the possession counts), but could not agree on a verdict for Count Three (the remaining possession count). The Government decided to retry Sarabia on Count Three.
In response to the Government's decision to retry him on Count Three, Sarabia filed a "Motion to Suppress," arguing that double jeopardy precludes the Government from introducing evidence that he was the driver of the RV that contained 458 kilograms of marijuana. He claimed that because the Government relied upon this evidence in attempting to prove Count One, the jury's determination that he was not guilty on that count demonstrated that they had rejected that evidence. The Government contended that the jury's verdict on the conspiracy count did not necessarily establish that the jury had rejected the evidence of Sarabia driving the RV, because the verdict could instead have been based on the insufficiency of the evidence of an agreement, a necessary element of conspiracy.
The district court construed Sarabia's motion to suppress as a motion to dismiss the indictment for double jeopardy. After a hearing on the motion, the district court agreed with the Government that the evidence of Sarabia driving the RV primarily concerned the possession count and did not implicate the existence of an agreement. The district court therefore denied Sarabia's motion and allowed the Government to retry him on the possession charge in a subsequent trial.
Sarabia then submitted an "Application for Certificate of Appealability," seeking leave to appeal the denial of his motion to dismiss the indictment. The district court characterized the application as a notice of appeal and concluded that it was a "nonfrivolous colorable claim." It then ordered that the retrial on possession be stayed pending appeal. Sarabia timely appealed.
II. JURISDICTION AND STANDARD OF REVIEW
"Under the collateral order doctrine, [this court has] jurisdiction under 28 *229 U.S.C. § 1291 to review a pretrial order rejecting a claim of double jeopardy, provided the jeopardy claim is `colorable.'" United States v. Shelby, 604 F.3d 881, 885 (5th Cir.2010) (citing Richardson v. United States, 468 U.S. 317, 322, 104 S.Ct. 3081, 82 L.Ed.2d 242 (1984)). A claim is colorable if "there is some possible validity to [the] claim." Id. (quoting Richardson, 468 U.S. at 326 n. 6, 104 S.Ct. 3081) (internal quotation marks omitted). Provided that the claim is colorable, this court reviews the district court's order de novo. United States v. Rabhan, 628 F.3d 200, 203 (5th Cir.2010) (citing United States v. Arreola-Ramos, 60 F.3d 188, 191 (5th Cir.1995)). Sarabia's issue preclusion argument is colorable, so we proceed to a consideration of the merits.
III. DISCUSSION
A. Issue Preclusion
Sarabia first argues that in acquitting him of conspiracy to possess with the intent to distribute marijuana, the jury necessarily determined an ultimate issue of fact: that he did not drive the RV loaded with 1,009 pounds[1] of marijuana and thus was not in possession of the marijuana. He contends that the Government's case against him consisted of the "one functional and central [piece of] evidence" that he drove the RV containing the marijuana. Further, he maintains that the Government relied on this fact in attempting to prove his knowledge of an agreement and voluntary participation in the conspiracy, and that these elements overlap with the knowledge and possession elements in the possession charge. Because proving this issue of fact is necessary to the Government's possession case on retrial, he maintains that the Government may not prosecute him on the possession charge because of issue preclusion and double jeopardy.
Issue preclusion means that "when an issue of ultimate fact has once been determined by a valid and final judgment, that issue cannot again be litigated between the same parties in any future lawsuit." Ashe v. Swenson, 397 U.S. 436, 443, 90 S.Ct. 1189, 25 L.Ed.2d 469 (1970). Although originally specific to civil litigation, courts have long applied this rule in federal criminal proceedings as well. Id. The Supreme Court has established that issue preclusion, also called collateral estoppel, is "embodied in the Fifth Amendment guarantee against double jeopardy." Id. at 445, 90 S.Ct. 1189. This court has applied issue preclusion to criminal proceedings in two distinct ways: (1) to "bar a subsequent prosecution if one of the facts necessarily determined in the former trial is an essential element of the subsequent prosecution"; and (2) if the fact is not an essential element of the subsequent prosecution, to "bar the introduction or argumentation of facts necessarily decided in the prior proceeding." United States v. Brackett, 113 F.3d 1396, 1398 (5th Cir. 1997). Appellants only invoke the first application here, as possession of the drugs is a necessary element of the subsequent prosecution. See United States v. Anchondo-Sandoval, 910 F.2d 1234, 1236 (5th Cir.1990).
In evaluating a claim of issue preclusion, the first step "is to determine which facts were `necessarily decided' in the first trial." Brackett, 113 F.3d at 1398 (citing United States v. Levy, 803 F.2d 1390, 1398-99 (5th Cir.1986)). Sarabia "bears the burden of demonstrating that the issue he seeks to foreclose was `necessarily *230 decided' in the first trial." Id. (citing Dowling v. United States, 493 U.S. 342, 350, 110 S.Ct. 668, 107 L.Ed.2d 708 (1990)). To determine "what [the] jury has necessarily decided," the court must "`examine the record of a prior proceeding, taking into account the pleadings, evidence, charge, and other relevant matter, and conclude whether a rational jury could have grounded its verdict upon an issue other than that which the defendant seeks to foreclose from consideration.'" Yeager v. United States, 557 U.S. 110, 129 S.Ct. 2360, 2367, 174 L.Ed.2d 78 (2009) (quoting Ashe, 397 U.S. at 444, 90 S.Ct. 1189). This "inquiry `must be set in a practical frame and viewed with an eye to all the circumstances of the proceedings.'" Ashe, 397 U.S. at 444, 90 S.Ct. 1189 (quoting Sealfon v. United States, 332 U.S. 575, 579, 68 S.Ct. 237, 92 L.Ed. 180 (1948)).
Furthermore, in Yeager, the Supreme Court held that a "hung count is not a `relevant' part of the `record of [the] prior proceeding.'" 129 S.Ct. at 2367 (alteration in Yeager) (quoting Ashe, 397 U.S. at 444, 90 S.Ct. 1189). It noted that "[u]nlike the pleadings, the jury charge, or the evidence introduced by the parties, there is no way to decipher what a hung count represents." Id. at 2638. Thus, while the court must examine the jury's acquittal of Sarabia on the conspiracy count, the jury's hung verdict on the possession count is irrelevant to the inquiry. Bearing these principles in mind, we turn to a review of the record in this case.
At trial, the Government produced witnesses who described how the alleged drug conspiracy came to the attention of authorities. In October 2001, a truck driver reported a suspicious RV parked outside of a motel near McAllen, Texas. He observed a man exit a white truck and drive the RV to what was later identified as Senior's house. Based on this tip, law enforcement officials began surveillance of the home.
On October 26, 2001, agents saw an RV depart the property. They followed it until it parked in a parking lot near an entrance to the highway. Two agents of the Texas Department of Public Safety Narcotics Service witnessed a man exit the RV and get into a white pickup truck before driving back to Senior's house. The pickup truck was registered to Sarabia and both agents testified at trial that they were later able to identify the man who had driven the RV as Sarabia, based on his driver's license photo. After watching a different man get into the RV and drive away, the agents conducted a traffic stop. Upon searching the RV, they found approximately 1,009 pounds of marijuana hidden inside its interior compartments.
The Government presented evidence that a man named Juan Sandoval was in charge of this drug-trafficking operation. Senior's brother-in-law, Leonides Yanez, testified about his own involvement in the operation. Yanez testified that Sarabia was also "helping" Juan Sandoval traffic drugs. Yanez's testimony made up the entirety of the Government's evidence directly linking Sarabia with Sandoval.
While Sandoval was not charged in this indictment and was thus not named as part of the conspiracy, the Government did name Leonel, Sarabia's brother, in the indictment. Leonel testified about his own involvement with Sandoval and the trafficking operation. Leonel also testified, however, that Sarabia was not involved in any drug trafficking. Leonel denied having ever admitted that Sarabia was involved with the scheme. He further stated that he had no knowledge of Sarabia driving the RV on October 26. On cross-examination, he denied that he was involved in a plan or scheme to move narcotics with Sarabia.
*231 In sum, a significant amount of the Government's evidence against Sarabia concerned him driving the RV on October 26, 2001. However, there was also conflicting testimony from Leonel that Sarabia was not involved in the drug-trafficking operation.
In order to determine what the jury necessarily decided based upon the evidence presented, we must consider the elements of a drug-related conspiracy. The district court instructed the jury that the following elements had to be met to find Sarabia guilty of conspiracy to possess with intent to distribute:
First, the [sic] two or more persons directly or indirectly reached an agreement to knowingly and intentionally possess with the intent to distribute a controlled substance, and that the controlled substance was marijuana; second, that the Defendant knew of the unlawful purpose for the agreement; third, that the Defendant joined in the agreement willfully, that is with the intent to further its unlawful purpose; and fourth, that the overall scope of the conspiracy involved more than 1,000 kilograms of marijuana, more than 2,200 pounds of marijuana.
The jury instructions also highlighted the contours of conspiracy law:
A conspiracy under the law is an agreement between two or more persons to join together to accomplish some unlawful purpose.
....
Mere presence at the scene of an event, even with knowledge that a crime is being committed, or the mere fact that certain persons may have associated with each other and may have assembled together and discussed common names and interest does not necessarily establish proof of the existence of a conspiracy. Also, a person who has no knowledge of the conspiracy, but who happens to act in a way which advances some purpose of a conspiracy, does not thereby become a conspirator.
Given the evidence presented at trial and the instructions the jury received, we determine that the jury's acquittal of Sarabia for conspiracy does not compel the conclusion that it found Sarabia was not driving the RV. To acquit Sarabia of conspiracy, the jury only needed to find that one of the required elements was not proved beyond a reasonable doubt. For one of these elements in particularthe existence of an agreementthe jury could have found that the Government failed to meet its burden of proof while still finding that Sarabia was the driver of the RV.
The evidence presented at trial makes such a scenario possible. Two Texas state agents gave eyewitness testimony that they observed Sarabia drive the RV, park it, and drive away in a white truck that is registered in his name. The jury may have credited this testimony. The evidence relating to a conspiracy included the statement of Yanez that Sarabia was helping Sandoval with drug trafficking as well as the testimony of Leonel that Sarabia was not involved. The jury may have credited Leonel's testimony on this point over Yanez's, or it may have concluded that there simply was not enough evidence of an agreement to remove the reasonable doubt that Sarabia was part of a conspiracy. Relying on the court's instructions, the jury may have found that Sarabia "ha[d] no knowledge of the conspiracy, but... happene[d] to act in a way which advance[d] some purpose of the conspiracy" by driving the RV. Per the instructions, that set of facts would not give rise to a conspiracy.
Of course it is possible that the jury determined that Sarabia was not the driver *232 of the RV. Nevertheless, our inquiry does not focus on what the jury may have decided, but rather on what it must have decided. See Brackett, 113 F.3d at 1398 ("When a fact is not necessarily determined in a former trial, the possibility that it may have been does not prevent re-examination of that issue." (quoting United States v. Lee, 622 F.2d 787, 790 (5th Cir. 1980)) (internal quotation marks omitted)). Sarabia bears the burden of demonstrating that the issue he seeks to foreclose whether he drove the RVwas "necessarily decided" by the jury in his first trial. He has not done so. Because Sarabia has failed to show that the issue of whether he drove the RV was precluded by the jury's verdict in his previous trial, he will not be placed twice in jeopardy by a retrial for the possession count on which the jury hung.
B. Lesser-Included Offense
Sarabia's other argument on appeal is that double jeopardy prevents the Government from retrying him for possession because it is a lesser-included offense of conspiracy. This argument has been directly foreclosed by the Supreme Court in United States v. Felix, 503 U.S. 378, 389, 112 S.Ct. 1377, 118 L.Ed.2d 25 (1992) (reaffirming that "a substantive crime and a conspiracy to commit that crime are not the `same offence' for double jeopardy purposes"). It is therefore not colorable and we lack jurisdiction to review this argument. Shelby, 604 F.3d at 885.
IV. CONCLUSION
Sarabia's issue-preclusion argument, while colorable, fails to establish that the issue he seeks to foreclose was necessarily decided in his prior trial. Thus, it does not amount to double jeopardy to retry him for possession of marijuana. The district court's denial of Sarabia's motion to dismiss the indictment is
AFFIRMED.
NOTES
[1] Although the indictment refers to this number in terms of kilograms, the testimony was presented in terms of pounds. | 01-03-2023 | 10-20-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1275675/ | 159 N.W.2d 417 (1968)
In the Matter of the ESTATE of Addle E. FARIS, Deceased.
No. 53018.
Supreme Court of Iowa.
June 11, 1968.
*418 Whitesell Law Firm, Iowa Falls, for appellants Everett and Edna Lyman.
Lundy, Butler, Wilson & Hall, Eldora, for appellee, Gladys L. Worrell.
SNELL, Justice.
This is a proceeding in probate tried as in equity. The controversy arose over the administratrix' petition to sell real estate free and clear of a 5-year lease between decedent and appellants-lessees.
Addie E. Faris, age 84, a widow without issue owned the 220-acre farm involved herein and 5 other parcels of real estate of lesser value. She died intestate. The probate inventory in her estate listed property appraised at over $108,000, including substantial bank accounts and personal property.
She was survived by two elderly sisters and a brother.
On November 17, 1966 Mrs. Faris entered into a 5-year lease of her farm with Everett and Edna Lyman. On February 7, 1967 Mrs. Faris while walking across the road to her mailbox was struck by a car and killed. Her administratrix sought cancellation of the 5-year lease on several grounds. The trial court found that decedent's incompetency had been proved by clear, satisfactory and convincing evidence and set aside the lease. The court also found that the lessees' counterclaim had not been substantiated.
The lessees appealed.
The printed record on appeal contains over 400 pages. Far too much of the record consists of testimony in question and answer form. It is not abstracted as required by rule 340, Rules of Civil Procedure. It continues a time-consuming pattern that caused the trial court to comment, "It's getting awfully tedious under this cross examination."
Appellants emphasize and reemphasize that to understand the crucial fact it is absolutely necessary that we read the entire record. Such is our custom and we have done so here.
The administratrix called 18 witnesses plus 1 in rebuttal. They included 2 doctors, a registered nurse and a nurse's aid who had attended decedent, decedent's sister, 2 farm neighbors, a deputy sheriff, county auditor, county treasurer, 3 bank officers, a real estate broker and other business people who knew and had done business with decedent. The lessees called 8 witnesses.
No useful purpose would be served by detailed discussion of the testimony of the many witnesses.
The trial court's findings of fact are overwhelmingly supported by the record. We quote:
"For many years Addie E. Faris and her husband lived on a farm near New Providence, Iowa. She was neat about her person and household. They had no children. They lived for a few years in Eldora, Iowa. Mr. Faris died, and Mrs. Faris moved back to the farm several years ago. She owned several properties in Hardin County.
"As the years came on, Mrs. Faris became afflicted with arteriosclerosis, which became more marked with the passage of time as she passed through her late seventies and into her eighties. In recent years her case became quite pitiful and then actually deplorable.
"Mrs. Faris became atrocious about her personal hygiene. She did not wash, and had an unpleasant smell about her. The lines in her skin had old dirt in them. The area of her organs of excretion was so filthy as to be almost scabby.
"Her clothing went downhill similarly. It was old, ragged, dirty, and disreputable. She wore several items of clothing, such as sweaters, over each other.
"She became like a pack rat about collecting worthless itemspapers, magazines, *419 old sewing machines, and numerous items of junk. She literally filled up one house in Eldora, and her farm house, with such items.
"She let her properties, like her person, go downhill. She did not paint or repair them, so that they fell into very poor condition.
"The rooms in the farm house where Mrs. Faris resided were full of junk, and she lived in the kitchen. She had an oil heater there, but ran only the pilot light, though she had substantial property. She wore many clothes. Litter filled the kitchen, as well as a very bad odor. She used a pail for a toilet, and did not keep it emptied. She used a hot plate for such cooking as she did, and slept behind the stove on a cot. The bed clothing consisted of gunny sacks, and the pillow was an old article of clothing filled with rags. The whole thing was very dirty, and the room was a boar's nest.
"As time went by, Mrs. Faris became more confused about her affairs and badly needed a conservator. But she was one of those extremely independent old persons who would not hear of any such thing, and was irrationally suspicious of those who would otherwise have helped her. Unfortunately, she had no children to come forward and take charge, as in the usual case of persons in extreme senility. Other persons disliked taking on the burden of asserting a contested conservatorship. She came to sing dirty songs, to curse, and to associate with disreputable individuals, completely out of character with her normal years.
"For several years Mrs. Faris had her farm in soil bank, and then Everett and Edna Lyman began to operate it. Lymans operated another farm in the neighborhood, on the customary year to year basis. Mrs. Faris' attorney lived in Eldora, but Lymans were acquainted with an attorney at Alden in another part of the county, and took Mrs. Faris there. The Alden attorney knew nothing of Mrs. Faris' past connections with the Eldora attorney, or of her background. Mrs. Faris executed a three-year lease on the farm to Lymans, from 1965 to 1968.
"By this time Mrs. Faris was losing her grip to the place that various individuals were importuning her for money and taking advantage of her. Two practicing physicians of wide experienceone a medical and the other an osteopathic physician observed her and regarded her mentally incompetent.
"The pressure by farm tenants for land is great, and Lymans decided to get a longer lease from Mrs. Faris. So while their existing lease still had a year to run, on November 17, 1966, they again took Mrs. Faris to Alden, and this time they obtained a five-year leasethe one overlapping year plus four more, running to 1972.
"On February 2, 1967, Mrs. Faris was killed on the highway while crossing the road to her mailbox.
"Mrs. Faris left as her heirs two sisters and a brother, all elderly. Her estate was opened, the five-year lease was discovered, and Lymans were promptly informed that the lease was invalid because of Mrs. Faris' mental incompetency. Lymans desire to hold onto the lease, and in this proceeding to sell the farm (and the other realty) to settle the estate, they put Mrs. Faris' mental incapacity in issue."
Not mentioned by the trial court were several additional matters in support of the conclusion. We mention a few. While hospitalized for a short period some time before her death Mrs. Faris caused trouble and continued her unclean habits. She was a constant complainer at the sheriff's office. She wrote checks and then complained about them. Her checks "bounced", although she was rich. She bought groceries in large amounts from welfare recipients. She had 5 lockers at a locker plant with meat as old as 12 years stored therein. She bought a side of beef for her cats. At a business openhouse she *420 ate from 2 to 3 dozen doughnuts. She bought firearms "so people couldn't shoot other people." She had a building roofed from the top down contrary to customary building methods.
Opinions of incompetency were expressed. They were based on actual observations and proper foundations were laid.
Reputable witnesses who knew decedent were called by the lessees. They expressed opinions that she knew what she was doing but we agree with the trial court that Mrs. Faris' incompetency was established by clear, satisfactory and convincing evidence.
I. In equity cases, especially when considering the credibility of witnesses, we give weight to the fact findings of the trial court, but are not bound by them. Rule 344(f), par. 7, Rules of Civil Procedure. Here we have reviewed the record and exhibits de novo and are in accord with the trial court.
II. The test here is not testamentary capacity. A higher degree of mental competence is required for the transaction of ordinary business and the making of contracts than is necessary for testamentary disposition of property. Bishop v. Scharf, 214 Iowa 644, 653, 241 N.W. 3; 94 C.J.S. Wills § 15 d(3); In re Estate of Van Dyke, 245 Iowa 942, 948, 65 N.W.2d 63; Gillette v. Cable, 248 Iowa 7, 12, 79 N.W.2d 195; In re Estate of Ruedy, 245 Iowa 1307, 1315, 66 N.W.2d 387.
III. To avoid the farm lease made by decedent it was necessary to show not only that Mrs. Faris was of unsound mind when it was made but that she had no reasonable perception of the nature and terms of the contract. The question is whether decedent had sufficient mental capacity to understand the contract she executed. Urbain v. Speak, 258 Iowa 584, 590, 139 N. W.2d 311 and cases cited therein.
In 17 C.J.S. Contracts, § 133(1)a, this appears:
"Where one of the parties, for any reason, is incapable of understanding the force and effect of the alleged agreement, there is no contract; but mere mental weakness falling short of such incapacity will not invalidate a contract.
"It is essential to the validity of a contract that the parties thereto possess not only the legal status affording capacity to contract, * * * but also the mental competence affording capacity to consent. The rule which has been said to be well stated in Corpus Juris Secundum is that to make a valid contract, each party must be of sufficient mental capacity to appreciate the effect of what he is doing, and must also be able to exercise his will with reference thereto. A court of equity guards with jealous care all contracts with persons of unsound mind. In this connection, it has been said that `insanity' and `incompetence' are words of vague and varying import."
In the case before us there was direct testimony and convincing evidence that Mrs. Faris did not understand and appreciate what she was doing.
IV. Two doctors who had attended decedent in her lifetime testified. Neither was a specialist in psychiatry but both were experienced in treating elderly patients and observing the aging process and mental deterioration. They testified that Mrs. Faris was incompetent to handle her business affairs.
Their testimony should be considered as expert testimony. In re Estate of Van Dyke, supra, 245 Iowa loc. cit. 945, 65 N. W.2d 63.
V. On February 17, 1967 the administratrix filed an application for the sale of the farm here involved. Before hearing thereon it was dismissed without prejudice. A new application in the same form and for the same purpose was filed June 2, 1967. Lessees claim that they incurred expense, were harassed, and disrupted *421 in their farming operations. They asked actual and punitive damages. We agree with the trial court that the counterclaim has not been established.
VI. We again advert to the conclusions of the trial court. We quote:
"The court has no question at all but what Mrs. Faris was mentally incompetent to enter into the lease. This lease was not a simple matter like buying a sack of groceries. It was an important business transaction which placed a lease of unusual duration upon her farm. Most leases are annual, so that rentals can be changed, arrangements can be altered, the freehold can be sold free and clear, and the tenant can be turned out if his performance proves unsatisfactory. Mrs. Faris was of such unsound mind that she was legally incompetent to enter into such a transaction.
"Lymans contend that the heirs have no equity. But the heirs stand in the shoes of Mrs. Faris. If she were here today challenging the lease through a convervator, she would prevail. Those who stand in her shoes likewise prevail.
"Lymans also contend that the scrivener of the lease is a careful and competent lawyer. There can be no question about that, nor can his integrity be challenged in any way. But the problem is that he was almost entirely unaware of the background. Mrs. Faris was brought to him from another part of the county. Had he been informed of the circumstances, as this court has now been informed, he would have done as he has done in other cases; refused to draw the lease and advised that a conservator be appointed.
"This is not merely a case of some arteriosclerosis and senility. All older people have some arteriosclerosis. But when the condition advances to the place that the person actually becomes of unsound mind, the capacity to enter into a legal transaction is involved. That is what we have here. This poor old soul needed help. She was so far advanced in the disease the medical doctor called it `severe arteriosclerosis and chronic brain syndrome, advanced' that she was no longer of sound mind. Her incompetency has been proved by clear, satisfactory, and convincing evidence. The lease cannot stand.
"The administratrix' allegation of confidential relationship, shifting the burden of proof, has not been established, although Mrs. Faris probably did lean on Mr. Lyman some. Neither have the charges of actual fraud and undue influence been substantiated, although Mr. Lyman ought to have taken Mrs. Faris to her regular lawyer or at least to a lawyer who was familiar with the circumstances. He overreached her some in getting this unusual lease from her, at her age and in her condition. All of these circumstances are not grounds in themselves for setting aside the lease, but they are considered in connection with the charge of unsoundness of mind, which has been established.
"Lymans' counterclaim is predicated on a prior petition to sell which was dismissed without prejudice by the administratrix. Lymans say they prepared to defend that proceeding and were put to expense, but the administratrix acted maliciously in dismissing it and recommencing the present proceeding.
"After the prior petition was filed, it was assigned for trial, and the administratrix contended she needed time for discovery and to prepare. Consequently she dismissed, and later started over.
"The court does not approve in the administratrix' procedure, but the counterclaim cannot be sustained. The court knows of no legal principle which subjects a litigant to damages for commencing a civil proceeding and dismissing it, even if the action is frivolous. On top of that, the prior proceeding was not frivolous, as has now been seen. After the administratrix did conduct discovery and did prepare for trial and the preparation on both sides was extensive and thorough it appeared on full trial that the allegations of the *422 prior petition like those of the present petition are true. Moreover, no malice appears. The counterclaim is not substantiated."
We agree.
The case is
Affirmed.
All Justices concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4056648/ | ACCEPTED
01-15-00505-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
6/8/2015 12:41:37 PM
CHRISTOPHER PRINE
CLERK
CASE NO. 01-15-00505-CV
FILED IN
1st COURT OF APPEALS
MARCY LERCH § IN THE FIRST COURT HOUSTON,
OF TEXAS
APPELLANT § 6/8/2015 12:41:37 PM
§ CHRISTOPHER A. PRINE
Clerk
V. § APPEAL OF TEXAS
§
WILMINGTON TRUST NA §
SUCCESSOR TRUSTEE FOR THE §
MERRILL LYNCH MORTGAGE §
INVESTOR TRUST SERIES 2006- § HOUSTON, TEXAS
HE5, APPELLEE
APPELLANT'S APPLICATION FOR
TEMPORARY RESTRAINING ORDER, TEMPORARY INJUNCTION
AND PERMANENT INJUNCTION
TO THE HONORABLE JUDGE OF SAID COURT:
NOW COME, MARCY LERCH, ET-AL, herein, and files this Appellant's
Application for Temporary Restraining Order and Temporary and Permanent Injunction against
WILMINGTON TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL
LYNCH MORTGAGE INVESTOR TRUST SERIES 2006-HE5, Appellee, herein
pending appeal, and in support thereof, shows the court the following:
FACTS
1. The case involves a home equity loan foreclosure. The property was foreclosed on or
about January 2015 by the appellee without first obtaining an Order of Foreclosure as
required under Tex. R. Civ. P. 736.
2. On or about March 20th, 2015 the lower court granted the Appellee a writ of Possession
to evict the Appellant. The Appellant immediately filed a motion of reconsideration and
a stay of writ and it was denied.
1
3. On or about May 21st, 2015 the Court denied Appellants motion to stay the
enforcement of writ of possession. The Appellant thereafter filed a notice of Appeal
and the case was assigned to the first Court of Appeal under this cause
4. However, without notice to the Appellant, Appellee is trying to execute the writ
possession issued by the lower Court.
5. Now the Appellee is in the process of evicting the Appellant before the Appeal is heard
and an issue relating to title is still pending also at the 240th Judicial Court of Fort Bend
County and pending Appeal in this Court. Hence this motion ensued.
6. It is well established that, as in here, when the defaulted loan is a home equity; prior to
foreclosure sale, the District Court in the county where the property is located must
approve the foreclosure taking place by issuing an Order of Foreclosure. And that
without such Order, any foreclosure sale is void. See Rule. 736.11(d)
7. An Order of Foreclosure is without prejudice and has no res judicata, collateral
estoppel, estoppel by judgment, or other effect in any other judicial proceeding. After
an order is obtained, a person may proceed with the foreclosure process under
applicable law and the terms of the lien sought to be foreclosed. See Rule 736.9.
8. Further, a proceeding or order under this rule is automatically stayed if a respondent
files a separate, original proceeding in a court of competent jurisdiction that puts in
issue any matter related to the origination, servicing, or enforcement of the loan
agreement, contract, or lien sought to be foreclosed prior to 5:00 p.m. on the Monday
before the scheduled foreclosure sale. As the Defendant did her. Hat petition was never
challenged by See Rule 736.11
9. Because the evidence showed that any foreclosure sale conducted by WILMINGTON
2
TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL LYNCH MORTGAGE INVESTOR
TRUST SERIES 2006-HE5 was void, they have failed to show that they owned the
property at the time of its forcible detainer action. Therefore, the county court did
not have jurisdiction to determine the issue of possession because that determination
rested on the resolution of title. See MORTGAGE ELECTRONIC REGISTRATION
SYSTEMS v. Young, No. 2-08-088-CV (Tex. App. June 4, 2009). See also, Green Tree
Servicing, LLC v. Woods, 388 S.W.3d 785 (Tex. App.-Houston [1st Dist.] 2012, no
pet.).1.
INJUNCTIVE RELIEVE
10. On or about May 21st, 2015 the Court denied Appellants motion to State enforcement
of writ of possession. The Appellant thereafter filed a notice of Appeal and the case
was assigned first Court of Appeal under case number. However, without notice to the
Appellant Appellee is trying to execute the writ possession issued by the lower Court.
2 Unless Appellant herein, is immediately enjoined and restrained, Appellee will be
evicted from his residence and render any judgment on Appeal in this case ineffective
ELEMENTS FOR INJUNCTIVE RELIEF
3. In light of the complexity of the facts and issues in this case and since the case
involves a home equity loan. Appellant is likely to succeed on appeal.
4. Appellant is likely to succeed on the merits of this lawsuit on appeal because the
Applicant’s conduct will null and void the judgment of this Court
5. Unless this Honorable Court immediately restrains the Appellee the Appellant will
suffer immediate and irreparable injury, for which there is no adequate remedy at law to give
Appellant complete, final and equal relief. More specifically, Appellant will show the court the
3
following:
A. The harm to Appellant is imminent because movant will be denied the right
to an appeal.
B. This imminent harm will cause Appellant irreparable injury in that as a
result of the denial of the Movants constitution right to a fair trial.
C. There is no adequate remedy at law which will give Appellant complete,
final and equal relief because it will render any judgment in this case ineffective.
BOND
6. Appellant is willing to post a reasonable temporary restraining order bond and
requests the court a bond be waived
REMEDY
7. Appellant has met Appellant's burden by establishing each element which must be
present before injunctive relief can be granted by this court, therefore Appellant is entitled to the
requested temporary restraining order.
8. Appellant requests the court to restrain Appellee from executing the writ of
possession.
9. It is essential that the court immediately and temporarily restrain Geraldine Barnes
Gibson from executing the writ of possession. And rendering any final judgment in this case
ineffective.
It is essential that the court act immediately, prior to giving notice to Appellee and
a hearing on the matter because it will render any judgment in this case ineffective.
10. In order to preserve the status quo during the pendency of this action, Appellant
requests that the Appellee be temporarily enjoined from executing the writ of possession and
4
rendering any final judgment in this case ineffective.
11. Following Appeal on the merits, that the Court permanently enjoin
WILMINGTON TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL LYNCH MORTGAGE
INVESTOR TRUST SERIES 2006-HE5, herein, from evicting and selling the said property.
PRAYER
WHEREFORE, PREMISES CONSIDERED, MOVANTS, Appellant herein, respectfully
prays that:
A. WILMINGTON TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL
LYNCH MORTGAGE INVESTOR TRUST SERIES 2006-HE5, will be cited to appear and
answer herein;
B. A temporary restraining order will issue without notice to WILMINGTON
TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL LYNCH MORTGAGE
INVESTOR TRUST SERIES 2006-HE5 restraining Appellee, Appellee's officers, agents,
servants, employees, agents, servants, successors and assigns, and attorneys from directly
or indirectly expunging the Lis Pendens and/or selling the said property.
C. The Court sets a reasonable bond for the temporary restraining order;
D. After notice and hearing, a temporary injunction will issue enjoining and
restraining WILMINGTON TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL
LYNCH MORTGAGE INVESTOR TRUST SERIES 2006-HE5 Appellee’s officers, agents,
servants, employees, successors and assigns, and attorneys from directly or indirectly
expunging the Lis Pendens and selling the said property.
E. After trial on the merits, the Court permanently enjoin
WILMINGTON TRUST NA SUCCESSOR TRUSTEE FOR THE MERRILL LYNCH
MORTGAGE INVESTOR TRUST SERIES 2006-HE5,Appellee’s officers, agents,
5
servants, employees, successors and assigns, and attorneys from directly or indirectly
expunging the Lis Pendens and selling the said property.
F. For such other and further relief, in law or in equity, to which
Appellant may be justly entitled.
Respectfully submitted,
By /S/ Diogu Kalu Diogu II, LL.M
Diogu Kalu Diogu II, LL.M
Texas Bar No. 24000340
Email: diogu.diogu.law.firm@gmail.com
P. O. Box 994,
Fulshear, Texas 77441
Tel. (713) 791 3225/Fax. (832) 408-7611
UNSWORN DECLARATION
My name is Diogu Kalu Diogu II, my date of birth is June 25th, 1959, and my address is
4736 Gainsborough Drive, Brookshire, Texas 77423, United States. I declare under penalty of
perjury that the foregoing is true and correct.
Executed in Fort Bend County, State of Texas, on the 05th, Day of June 2015.
Respectfully submitted,
By: /S/ Diogu Kalu Diogu II, LL.M
Diogu Kalu Diogu II, LL.M
Texas Bar No. 24000340
P. O. Box 994, Fulshear, Texas 77441
Tel. (713) 791 3225/Fax. (832) 408 7611/
Attorney for Plaintiff,
Diogu Kalu Diogu II, LL.M.
6
7 | 01-03-2023 | 09-29-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3854954/ | KELLER and GAWTHROP, JJ., dissent.
Argued April 16, 1928.
The appellant's claim to share as widow in the distribution of the decedent's estate was rejected by the Orphans' Court. It appears from the evidence that the claimant lived with her parents in Tennessee where in January, 1871, she was married to one, Charles A. Eastman. After living together about two years at the home of her parents, her husband took up his residence at his father's home nearby and continued to live there until sometime in 1882, when he left the state without the knowledge of his wife, from which time she had no communication with him nor information as to his whereabouts prior to his death in Michigan in November, 1903. Not long after his desertion, her father having died, she accompanied her mother back to Armstrong County in this State where they lived before going to Tennessee. Some time prior to 1898, the claimant learned from a friend in her former home in Tennessee that it was reported *Page 474
there that her husband was dead, whereupon she employed an attorney living in that vicinity to ascertain the fact with respect to him and inform her. After inquiry, her attorney reported that he was unable to get any information as to whether her husband was living or dead, or as to his whereabouts if living. On the 18th of August, 1898, the claimant and John L. Holben went to Salamanca in the State of New York where they entered into a marriage contract before a Justice of the Peace there living. Holben had been married before and had a family of twelve children, nine of whom were living at home. He and the claimant returned to his home where the latter was introduced to his family and his neighbors as his wife. She was so recognized and received among their relatives, neighbors and acquaintances and so conducted herself until the death of Holben in January, 1926, up to which time there had been no question raised as to the validity of their marriage. They were esteemed in the community in which they lived and Holben who was a prosperous business man had accumulated a considerable estate. Seven conveyances of real estate executed at different periods between July 19, 1904, and December 8, 1922, conveying land owned by Holben in Armstrong, Jefferson and Butler Counties in Pennsylvania, were signed by Holben and the claimant as husband and wife and regularly acknowledged as such by them. By his last will executed January 1, 1926, Holben disposed of part of his estate as follows: "To my wife, Sarah J. Holben, I bequeath $4,000." Evidence was offered in opposition to the appellant's claim to the effect that Eastman, her husband, after having deserted her, went to Ohio where he lived a few years from which State he moved to Michigan, where on the 12th of May, 1900, he entered into a contract of marriage with Rachael Jennings. He died in that State on the 8th of November, 1903. On the state of facts thus disclosed the Orphans' *Page 475
Court held that the claimant was not the widow of the decedent because of her former marriage, and the fact that her husband was living at the time of the marriage ceremony between the claimant and Holben at Salamanca. The presumption is that the contract of marriage entered into by the parties before the magistrate in Salamanca was lawful and this presumption was recognized by the counsel for the appellee and the trial court. There is no support in the testimony for an inference of intended immorality in the conduct of the parties. So far as can be ascertained or may be inferred from the facts developed they intended in good faith to create the marital relation and the evidence does not admit a conclusion that their conduct in entering into their contract of marriage and in their relation afterwards was not consistent with such purpose. It was not sufficient to successfully resist the claim presented to show that the appellant's husband was living at the time she entered into the contract with Holben. It appearing in the evidence that Eastman was married to a woman in Michigan soon after Holben and the claimant had their marriage ceremony, the presumption in favor of innocence implies that the Michigan ceremony was lawful. The appellees must overcome that presumption therefore: Wile's Est., 6 Pa. Super. 435; Thewlis' Est., 217 Pa. 307; Richardson's Est., 132 Pa. 292. This obligation was assumed and testimony was taken to show that no divorce had been granted to Eastman at the place of his domicile in Tennessee between the date of his marriage there and the time of the marriage contract of the appellant in New York, but this leaves out of consideration the opportunity of Eastman to obtain a divorce in Ohio where he was domiciled for several years, or in Michigan where he lived the remainder of his life and where he was again married. The law will not gratuitously impute crime to anyone, the presumption being in favor of innocence *Page 476
till guilt appears: Breiden v. Paff, 12 S. R. 430; Senser v. Bower, 1 P. W. 450; Thewlis' Est., supra; Wile's Est., supra; I Greenleaf's Evidence, Sec. 35. As the presumption of regularity and legitimacy supports the marriage of Eastman in Michigan, there is no presumption that his legal capacity to be married arose at any particular time, and therefore in aid of innocence and legitimacy of the claimant here, the presumption is that his legal capacity to marry occurred before the marriage of his wife, the claimant: McCausland's Est., 213 Pa. 189; Picken's Est., 163 Pa. 14; I Greenleaf on Evidence, Sec. 41. It was said in Wile's Estate, supra, "that society rests upon marriage, the law favors it, and when a man and woman have contracted marriage in due form, the law will require clear proof to remove the presumption that the contract is legal and valid." Forty-four years after Eastman deserted his wife in Tennessee, and twenty-eight years after the claimant entered into the agreement with Holben to become his wife, an effort is made to show that this agreement was unlawful, and that the relation between the parties believed to be honorable and legitimate for nearly thirty years, was one of concubinage and illegal. After so great lapse of time all presumptions favor the legitimacy of the relation of the parties, and one seeking to establish the contrary should do so by clear and unequivocal evidence, and a decree to that effect ought not to rest on the assumption that the marriage of Eastman in Michigan was without authority of law. It is argued for the appellees that no divorce could have been granted to Eastman in the State of Michigan because the respondent received no notice of such proceeding, but it is sufficient to refer to the fact that many of the divorces granted in this Commonwealth and other states have no support in a personal service. The court having jurisdiction of the subject may enter a decree in conformity with the *Page 477
laws of the state whether or not that be effective with respect to the rights of the wife in the property of the divorced husband in the state of their former common domicile. It cannot be confidently contended that a decree of divorce entered in the State of Michigan would not be effective to annul the marriage bond, when not appealed from, if entered in conformity with the laws of that state, and the divorced wife, although not served with process, would be at liberty to accept the result of the decree. We find no evidence in the record of an attempt to show that no divorce was granted to Eastman before his marriage in Michigan, and the presumption of legitimacy of that marriage has not been overcome. There is no evidence or contention in the case that the relation between Holben and the claimant was meretricious either before or after their marriage agreement. They intended to become husband and wife through the ceremony engaged in, and their conduct comported with that understanding.
If it be conceded however that a presumption in favor of the regularity of the marriage of Eastman in Michigan and of his capacity to marry before the marriage contract of the claimant with Holben has no support in law, there remains for consideration the effect of the relation and conduct of the parties after the death of Eastman as bearing on the existence of marriage. It is true that the claimant testified on cross-examination that she was never married to Holben after the death of Eastman, but the context shows that she had reference to a marriage ceremony or a formal marriage agreement. Her evidence had no reference to the course of conduct engaged in by herself and Holben amounting to the recognition of the marriage relation between them. They had been married so far as form was concerned; there was no interruption of the belief that they were husband and wife during their joint *Page 478
lives, and there were repeated acts equivalent to a declaration that they were husband and wife. In seven deeds made while they were living together after the death of Eastman, delivered at various times between 1904 and 1922, they described themselves as husband and wife and acted in that capacity in their acknowledgments of the several conveyances. These instruments certainly show the declaration of the parties of the existence of a marital relation voluntarily assented to: Maryland v. Baldwin, 112 U.S. 490; Travers v. Reinhardt, 205 U.S. 423. It was said in Stevenson's Est., 272 Pa. 291, that a deed made by a woman claiming to be the wife of the decedent for the conveyance of some property owned by her in Ohio, was not conclusive on the question of marriage, but in that case the evidence was overwhelming that the decedent had never lived with the claimant as a husband and the conduct of the claimant after the date of an alleged marriage was wholly inconsistent with her claim. The case is authority, however, for the competency of evidence of such instruments with respect to the acknowledgment of the parties that they sustained the relation of husband and wife, and the decedent here in the solemnity of his will declared that the claimant was his wife. More than that, the home was conducted in a manner leaving no other impression on those familiar with the parties than that they were married. The children addressed the claimant as their mother, and so far as appears in the case a harmonious, respectable and respected domestic condition existed to the last day of the decedent's life. There was convincing evidence therefore that whatever may have been the mistake of the parties as to the legal effect of their marriage agreement, a state of matrimony existed between them after the death of Eastman. It was said in Edwards v. Enterprise Mfg. Co., 283 Pa. 420, "that the presumption that a cohabitation meretricious in its origin continues to be *Page 479
of that character may be rebutted and proved to have become matrimonial and a lawful common-law marriage established. The change may be established by circumstantial evidence, but the circumstances must be such as to exclude the presumption that the original relation continued and to prove satisfactorily that it was changed to matrimonial union by mutual consent." In that case the claimant admitted that she was not married; that no ceremony had been performed between them; that "she just went to live with him as others because she cared for him and thought he cared for her. That there was nothing said between them about going to live together as man and wife." Their relation, therefore, was clearly meretricious, but that epithet is not applicable to the claimant in this case. She rested under a belief of the death of her former husband. This proved to be a mistaken belief which rendered her marriage invalid as she discovered after the death of Eastman, but her arrangement with Holben was not the suggestion of lust nor intended to be in violation of law. It could properly be continued therefore after the death of Eastman on the understanding between the parties that they were husband and wife. This, we think the evidence clearly shows, is what they did. All the evidence is to that effect, and at this late day the reputation and conduct of the decedent and claimant ought not to be impeached on the evidence introduced in denial of the claimant's right. Something is predicated by the court of the fact that the parties went to Salamanca to be married after having made application to the Clerk of the Court of their own county for a license, but there is nothing to warrant the conclusion that that was done in defiance of the laws of Pennsylvania. The Clerk of the Court imposed upon them the necessity of showing that the former husband was dead, but that was a task not readily accomplished. His whereabouts had been unknown for many *Page 480
years, and it was much easier for the parties to go to a place not remote where a marriage could be celebrated without that necessity. We think, the court was in error therefore in dismissing the appellant's petition, first, because the presumption of a divorce obtained by Eastman was not overcome; and, secondly, because the uncontradicted evidence clearly shows that the claimant and Holben intended to, and did openly and publicly, by word and act, acknowledge themselves to be husband and wife after the death of Eastman. The long and faithful service and companionship of the claimant in the decedent's household and their continuous conduct and repeated declarations showing that they were so related and regarded should now be considered satisfactory proof.
The decree is reversed and the record remitted to the court below with a procedendo. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3396988/ | The amended bill of complaint, among other things, alleged in effect that plaintiff, being the owner of certain lands *Page 37
in Jackson County, Florida, on November 1st 1943, executed an oil and gas ten year term lease to Sun Oil Company for the sum of $75.00 or 25c per acre rental. A copy of the lease is attached to the bill and is in conventional form. That on August 23rd 1944, while said lease was in full force and effect, "the defendant M. B. Rudman, called at the home of the plaintiff, near Grand Ridge, Florida, and introduced himself to the plaintiffs as being the agent of the said Sun Oil Company, and then and there stated and represented to the plaintiffs that the said Sun Oil Company, which he then represented, had more money than it knew what to do with, and desired to invest some of its surplus moneys in purchasing from the plaintiffs, and from other lessors to said Sun Oil Company, a one-half share of the 1/8 royalty which the plaintiffs and other lessors to said Sun Oil Company had reserved to themselves in their leases to Sun Oil Company, and that he, the said Rudman, was then and there ready to purchase of and from the plaintiffs a one-half share of such 1/8 royalty so reserved by the plaintiffs in their said lease to Sun Oil Company, and that he, the said Rudman, would pay to plaintiffs then and there the sum of 50c per acre, or the sum of $150.00, for such share of said royalty. And the said Rudman then and there withdrew from his brief case a printed form of instrument for the plaintiff Curtis Neel to examine, and handed the same to him; and the plaintiff Curtis Neel did read over the same, and found nothing in the printed form contrary to the representations made by said Rudman to plaintiffs as hereinafter set out, and the said Rudman, after the plaintiff Curtis Neel had looked over the form handed him, took up from the plaintiff Curtis Neel the form which he the said Rudman had offered for examination, and thereafter withdrew from his brief case another printed form which he, the said Rudman, presented for execution by the plaintiffs.
That the plaintiff Curtis Neel acting for himself and his wife, then and there inquired of the said Rudman if the instrument which he, the said Rudman, had and held in his hand and offered to plaintiffs for execution, when executed by plaintiffs would in anywise reduce or affect the annual rental which the plaintiffs had been receiving and expected to continue to receive *Page 38
from their lease to Sun Oil Company, and further inquired of said Rudman as to how long a period of time the instrument so offered to plaintiffs for execution would run or last, and further inquired of said Rudman if the instrument which he had offered the plaintiffs for execution would or did cover or include anything other than the 1/8 royalty which the plaintiffs had reserved in their said lease to Sun Oil Company.
5. That the said Rudman did then and there, in response to the said inquiries of the plaintiffs, in order to induce the plaintiffs to execute the said instrument so offered by him to them for execution, (and which the plaintiffs did thereafter execute), stated and represented to the plaintiffs the following material facts, as an inducement to the execution of said instrument, to-wit:
(a) That the said instrument was only for the purchase of a one-half share of the royalty which the plaintiffs had reserved in their lease to Sun Oil Company, as aforesaid: (b) that the said instrument covered nothing else than the purchase of a one-half share of plaintiffs said 1/8 royalty; (c) that he, the said Rudman, was then and there the agent of the said Sun Oil Company; (d) that the life of the said instrument which he, the said Rudman, offered for execution would be the same as the life of the lease to Sun Oil Company, — that the said instrument would expire or run out as and when the lease aforesaid should run out; (e) and that by the plaintiffs executing the said instrument so offered the annual rents from the said Sun Oil Company would not in any manner be reduced or affected. — that plaintiffs would continue to receive the full rentals provided for in their lease to Sun Oil Company.
That the plaintiff had found their dealings with the said Sun Oil Company entirely satisfactory, and the introduction by said Rudman of himself as agent of that company tended to create and did create in the plaintiffs a feeling of confidence in the said M. B. Rudman and a feeling of confidence or faith in the truthfulness of the aforesaid representations which the said Rudman had made to the plaintiffs; and the terms and consideration and effect of the said instrument so offered to *Page 39
plaintiffs for execution as stated by said Rudman appearing to be fair and just to the plaintiffs, and the plaintiffs having at the time been without any experience in the reading and interpretation of written contracts, leases and deeds, and being without the ability to understand and construe such documents as oil and gas and mineral deeds, the plaintiffs believed the said material representations of fact so made to the plaintiffs by the said Rudman, as above stated, to be true and relied upon such representations as being true, and so believing and so relying upon the truth of such representations, and having no notice or knowledge that such representations were untrue, the plaintiffs signed and executed the instrument as so presented to them as aforesaid and delivered the same to said M. B. Rudman and received of and from said Rudman the consideration for such instrument in the sum of $150.00.
Plaintiffs aver that said instrument of which Exhibit B is a copy, was duly filed for record and recorded in the public deed records of Jackson County, Florida, in Deed Book 373, page 170, on Sept. 5, 1944, and a certified copy of said instrument, marked Exhibit B, is hereto attached and by reference made a part hereof.
Plaintiffs further aver that after the said instrument, Exhibit B, was executed and delivered to said Rudman, he, the said Rudman, gathered up and took away with him all printed forms of said instrument and left the plaintiffs no copy whatever, but such circumstances did not, however, at the time, cause any suspicion on the part of the plaintiffs.
That the plaintiffs did not have any knowledge or notice of the true character of the instrument which they had executed until after the next annual rental payment from Sun Oil Company to plaintiffs became due and payable; and the plaintiffs then found and were advised that only one half the annual rental was remitted to the plaintiffs, and that one half of such rental payment had been made to said M. B. Rudman, and his assignees.
6. That sometime thereafter the plaintiffs employed an attorney, and procured from the Clerk's office a copy of the said instrument, Exhibit B, labeled MINERAL RIGHT AND *Page 40
ROYALTY TRANSFER. That upon obtaining a copy of said instrument the plaintiffs were advised by their attorney, and now allege the fact to be, that the said instrument (Exhibit B) so executed by plaintiffs to said M. B. Rudman was not and is not the instrument so explained and represented by the said Rudman to the plaintiffs to be, but that on the contrary the said instrument does cover and include an assignment of one-half the annual rentals payable to the plaintiffs under the terms of their said lease to Sun Oil Company, and does further contain an outright grant or conveyance in perpetuity of a one half share or interest in all oil, gas and other minerals on, in or under the lands of the plaintiffs aforesaid, described in Section 2 of this amended bill, and that the said instrument constitutes a perpetual encumbrance on and limitation of the fee simple title to said lands of the plaintiffs, and seriously and injuriously affects, for all time to come, unless the said instrument be cancelled, the value, the loan value and the marketability of the plaintiffs' said lands.
Plaintiffs further aver that the aforesaid representations of material facts stated and made to the plaintiffs by the said Rudman, as an inducement to the plaintiffs to execute the said instrument, of which Exhibit B is a copy, as representations of such facts as are set forth in paragraph 1 of Section 5 of this amended bill, were each and every one of them false, fraudulent and untrue, and were at the time the said representations were made by said Rudman by him known to be false and untrue; that the said representations of material facts so made by said Rudman to plaintiffs as aforesaid, were relied on and believed by the plaintiffs to be true at the time they executed the said instrument to said Rudman, represented by Exhibit B, and such false and material representations of fact had the effect of inducing, and did induce, the plaintiffs to execute the said instrument, Exhibit B, which the plaintiffs would not have executed but for said false representations of material facts and the plaintiffs' reliance on such representations as being true.
Plaintiffs further aver that at the time of the execution of the said instrument, Exhibit B, the said M. B. Rudman and the plaintiffs did not stand upon equal footing, in this, to-wit: *Page 41
that the said Rudman at such time was trained and experienced in the understanding and interpreting of contracts, leases and deeds relating to oil, gas and other minerals, and for a long time prior to the execution of said instrument, Exhibit B, the said Rudman had been engaged as a business in taking leases, mineral rights and royalty transfers, and other like instruments from various and sundry people, and in making transfers of all kinds involving oil, gas and mineral rights in lands, and the said Rudman then and there knew the legal effect of the said instrument which he procured the plaintiffs to execute, whereas the plaintiffs, at the time of making said Mineral Right and Royalty Transfer had no knowledge of or experience in the making of leases, contracts or deeds relating to oil, gas or other mineral rights, and were incapable of interpreting or understanding the legal effect of the instrument which they executed, represented by Exhibit B." It was then alleged that Rudman and his assigns have since said transaction, received one-half of the annual rentals paid by Sun Oil Company for said lease.
It is alleged that Rudman and wife have assigned certain interests in said minerals to one Susman and to one Allison who, with their respective wives, are joined as defendants. The plaintiffs offer to return to Rudman sufficient of the consideration paid them which with the payments made by Sun Oil Company to Rudman will equal the amount paid by Rudman to plaintiffs in this transaction.
It must be borne in mind that a conveyance of a royalty interest and the conveyance of minerals in place are two entirely different documents and convey entirely different interests, but that to the average man with no experience in such matters they appear so much alike as for one to be easily substituted for the other.
The chief difference in these two documents is that a royalty deed provides:
"That I or we __________, Grantor, of __________, for and in consideration of the sum of __________ ($__________) Dollars cash in hand paid by __________, Grantee, receipt of which is hereby acknowledged, and for other valuable considerations *Page 42
do hereby grant, bargain, sell and convey unto said Grantee __________, as same may be produced and saved, of the oil and gas in or under the following described land in the county of __________ State of __________, to-wit: __________ (description)"
And also:
"However, if oil or gas be produced from said lands by Grantor or by any other in paying quantity, then there shall be paid to Grantee, his heirs, personal representatives or assigns, the above and foregoing part of the total saved production; namely, __________ thereof, as royalty, according to this Deed."
While the mineral Deed provides:
"That I, or we, __________, Grantor __________, of __________ for and in consideration of the sum of __________ ($__________) Dollars cash in hand paid by __________, Grantee, receipt of which is hereby acknowledged, and for other valuable considerations do hereby grant, bargain, sell and convey unto said Grantee the following described interest in the oil and gas and other minerals, to-wit: __________ comprising __________ acres, more or less; together with the rights of ingress and egress for making geological investigations and exploring for oil and gas and other mineral possibilities, and of erecting structures of any needful kind for producing, saving, storing and transporting oil and gas and other mineral, as, if and when produced on the premises, and to do any and every matter and thing incident to such operation; with the right to remove any and all property of whatsoever kind or character placed on the said land." —
And also:
"Either party hereto having an interest in the oil, gas or other minerals under the terms of this deed, his heirs, assigns or personal representatives may lease the lands herein described for the exploration of oil, gas and/or other minerals and thereupon the parties hereto shall be bound by the terms of such lease and the parties hereto shall share in the proceeds of such lease in proportion to the interest of each in such oil, gas or other minerals, as fixed by this Deed; provided, however, *Page 43
no lease shall be made for less than a one-eighth royalty in addition to such cash payments or rentals as may be required of Lessee."
These are matters so generally known that courts may take judicial cognizance of them.
Our conclusion is that the amended bill of complaint states equitable grounds for the relief prayed as against Rudman and wife but fails to show such guilty knowledge on the part of their alleged assignees. So the order dismissing the cause as to Rudman and wife is reversed but such order as to Susman and Allison is affirmed.
So ordered.
TERRELL, CHAPMAN and BARNS, JJ., concur.
THOMAS, C. J., ADAMS and SEBRING, JJ., dissent. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4523629/ | Case: 19-50571 Document: 00515375507 Page: 1 Date Filed: 04/08/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
No. 19-50571
Fifth Circuit
FILED
Summary Calendar April 8, 2020
Lyle W. Cayce
UNITED STATES OF AMERICA, Clerk
Plaintiff-Appellee
v.
BRYAN JESUS MONTOYA-ROSADO,
Defendant-Appellant
Appeal from the United States District Court
for the Western District of Texas
USDC No. 4:19-CR-60-1
Before KING, GRAVES, and WILLETT, Circuit Judges.
PER CURIAM: *
Bryan Jesus Montoya-Rosado appeals his sentence following his guilty
plea conviction for aiding and abetting the importation of marijuana and aiding
and abetting the possession of marijuana with intent to distribute. He
contends that the district court erred by sentencing him less than 35 days after
disclosure of his presentence report (PSR). Under Federal Rule of Criminal
Procedure 32(e)(2), the probation office must disclose the PSR to the defendant
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
Case: 19-50571 Document: 00515375507 Page: 2 Date Filed: 04/08/2020
No. 19-50571
at least 35 days prior to sentencing unless the defendant waives the minimum
notice period.
Because Montoya-Rosado failed to object on this basis in the district
court, we review for plain error. See United States v. Esparza-Gonzalez, 268
F.3d 272, 274 (5th Cir. 2001). Even if the district court erred, Montoya-Rosado
fails to demonstrate a reasonable probability that he would have received a
lower sentence; thus, he fails to show that any error affected his substantial
rights. See Molina-Martinez v. United States, 136 S. Ct. 1338, 1343 (2016).
AFFIRMED.
2 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3859959/ | Argued November 12, 1936.
Plaintiff brought suit against the defendant as the *Page 427
registered owner to recover taxes paid by plaintiff for the years 1932 to 1935 inclusive. Defendant's contention was that she had no knowledge the title to the premises in question had been placed in her name. The case was tried before a judge sitting without a jury, who found for the plaintiff. From the judgment entered on the finding, defendant has appealed.
On October 23, 1928, Snyder Weinfeld executed a bond and mortgage, which was duly recorded, upon premises located at 348 West Roosevelt Boulevard, Philadelphia, Pa. A deed from Weinfeld to Blanche Ohlbaum — the defendant — his sister, for the premises was recorded on October 23, 1930. The bond and mortgage were assigned, on May 6, 1932, to Marie Sher — the plaintiff — another sister of Weinfeld. From 1930 to the date of trial, the premises were occupied by Weinfeld. A scire facias was issued upon the mortgage against Sydney Weinfeld, grantor, and Blanche Ohlbaum, real and registered owner, and the scire facias was personally served on Blanche Ohlbaum on November 30, 1934. On January 4, 1935, a registered letter was sent by plaintiff's counsel to Blanche Ohlbaum notifying her that a writ of levari facias has been issued directing the sheriff to sell the premises of which she was the real and registered owner, and a sale would be had on February 4, 1935. Plaintiff purchased the premises at the sale and paid the taxes. At the request of his uncle, Weinfeld, Will N. Ohlbaum, son of the defendant, then living with his mother, had prepared the deed, witnessed its execution and recorded it. The son, called by the plaintiff, and Weinfeld, called by the defendant, testified that they had not informed the defendant of the transaction. Plaintiff called the defendant for cross-examination, but the examination was confined solely to defendant's personal relations with her son. Later, before the plaintiff had closed her case, defendant was recalled and examined by the court, *Page 428
during which she testified that she did not know the property had been registered in her name for the years 1930 to 1935, and did not receive any tax or other bills relating to the premises.
". . . . . . When a deed or other conveyance is duly recorded and registered in the name of a given person he, as the registered title holder, is regarded as the `owner' for purposes of assessment and taxation, and is personally liable for taxes levied on the property. . . . . . . Under the Act of 1854, P.L. 21, section 11, there is one possible exception which may relieve a registered owner from liability. That act provides: `If any person against whom such taxes shall have been assessed, shall make affidavit he did not own (the land) . . . . . . at the time they accrued and became a lien thereon, the said taxes shall be collected of the true owner thereof.' This would apply where a grantor conveys and the grantee does not record his deed. . . . . . Another exception occurs where a person, without his knowledge or consent, has had a deed made and duly recorded conveying to him title to land. . . . . . While the law affixes liability to presumptive ownership as shown by registration of title, if that ownership is created through no act of the person in whom title is placed and without his knowledge and consent, then the law would not require him to pay taxes, if, after knowledge thereof, he takes prompt and adequate steps to disavow such ownership through a reconveyance. But if he fails to take advantage of the act when he learns of his liability, the prima facie liability becomes absolute as between such party and the municipality. Such grantee may, however, recover from the grantor the taxes paid and in this respect is in the same position and has the same rights as any third person required to pay taxes. . . . . . If . . . . . . a third party, as a mortgagee, is required to pay taxes, such party steps into the shoes of the municipality, and is subrogated to its rights, which, *Page 429
of course, includes the right to proceed against the record title owner:" Pennsylvania Co., Trustee, v. Bergson, 307 Pa. 44, 51,52, 54, 159 A. 32. See Integrity Trust Co. v. St. Rita B. L.Assn., 112 Pa. Super. 343, 171 A. 283; Provident Trust Co.v. Judicial B. L. Assn., 112 Pa. Super. 352, 171 A. 287.
Plaintiff having proved defendant was the registered owner of the premises, a prima facie liability was established and it was incumbent upon the defendant to prove she had no knowledge the title was in her name, and, that prompt and adequate steps were taken to disavow her title when she acquired the knowledge. To rebut a presumption sufficient to take plaintiff's case to a jury, the oral evidence, relied upon by the defendant, must be clear, positive, credible, uncontradicted and indisputable:Hartig v. American Ice Co., 290 Pa. 21, 137 A. 867. To overcome the prima facie liability, the only testimony contained in the record, outside of the cross-examination of defendant by the court, is the negative testimony of the son in plaintiff's case and the brother's testimony in defendant's case that the defendant had not been informed of the transaction. Defendant admitted she had been served with the scire facias and had received the letter from plaintiff's counsel, yet she was content with notifying her brother and consulting a lawyer to see what the writ was. As thus presented, it was purely a question of fact to be determined by the court, whose findings have all the weight of a verdict of a jury: McGowan v. Steele Sons, 112 Pa. Super. 552, 171 A. 903. In its opinion, the court below said: "In this case, the Court as judge of the facts after carefully weighing the testimony, is convinced that the defendant had knowledge of the conveyance, notwithstanding her testimony, and the testimony of Weinfeld and her son that she had no knowledge. In this connection, it should be noted that the deed was prepared by her *Page 430
son, who was an employee of a Title Company, and was certainly aware of the responsibility assumed by one who has title recorded in his name. It is hardly likely that he would expose his mother to such responsibility without her knowledge or consent."
Appellant earnestly contends that the plaintiff was bound by the answers of the defendant when examined by the court. It has frequently been decided that if one litigant calls his adversary to testify upon cross-examination, while the testimony thus obtained is not conclusive upon the former, but may be rebutted by other proof, yet to the extent it is not rebutted it is conclusively taken to be true: Krell v. Jacobson, 314 Pa. 522,172 A. 697. Plaintiff's counsel, undoubtedly recognizing the danger of cross-examining the defendant as to her knowledge, avoided any questions on that point and confined his examination solely to the personal relations of defendant and her son. The questions asked by the court undoubtedly were important as a matter of defense, but in view of the restricted examination conducted by plaintiff, the rule above referred to should not be applied as to answers to questions of the court.
As has often been said, it is the right and sometimes the duty of the trial judge to interrogate witnesses, but his interrogations are bound by the same rules as govern counsel and particular care should be exercised in such examinations, especially of a defendant called for cross-examination. However, we are persuaded that defendant's negative testimony that she had no knowledge was not so clear, positive, uncontradicted and indisputable as to clothe it with credibility when taken in connection with other portions of her testimony in which she admitted having been served with the scire facias, as the real and registered owner, and the receipt of a letter from plaintiff's counsel prior to the sheriff's sale.
Judgment affirmed. *Page 431 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3860871/ | Argued April 14, 1937.
The question raised by this appeal is whether the plaintiff was entitled to amend his action against the defendant insurance company by adding as plaintiffs two additional persons jointly insured with him in the policy sued upon, after the time within which a new action could be brought on the policy. The court, at *Page 535
first, allowed the amendment, but on the trial ruled that it had been applied for too late. As the action would not lie in the name of the plaintiff alone, a compulsory non-suit was entered, which the court subsequently refused to take off. Plaintiff appealed. We are of opinion that the court's action in allowing the amendment was, in the circumstances here present, proper, and that the non-suit was improvidently entered and should have been taken off.
On July 21, 1930 the defendant issued its policy insuring the appellant, F.C. Leland and Jiovann (John) and Elizabeth Saraceno against loss or damage by fire to property No. 527 West Washington Street, Corry, Pennsylvania, ($2,000) and garage on the premises, ($200), for three years from that date. Below the names of the insured appeared the following: "A contract of sale has been issued from F.C. Leland to J. E. Saraceno." Elizabeth Saraceno is John Saraceno's wife.
The contract of sale was in writing and was dated October 28, 1929. By its terms Leland agreed to sell and convey the above mentioned premises to John Saraceno and Elizabeth Saraceno for $1,800, payable, $300 on the signing of the agreement and $25 on the tenth day of November, 1929, and $25 on the tenth day of each and every month thereafter until $1,800 had been paid; together with interest at six per cent., payable semi-annually. Upon payment of said sum and interest, Leland was to execute and deliver a general warranty deed conveying the said premises in fee simple to the Saracenos. The agreement further provided that the Saracenos were to go into immediate possession of the property and were to pay the taxes and keep the buildings insured in the sum of $1,500 payable to Leland, "as his interest may appear." It further provided that in case of default of payment of any sum of principal, interest, taxes or premiums of insurance for *Page 536
the space of thirty days after the same became due and payable, the whole of the said principal sum should at Leland's option, become forthwith due and payable, and authorized confession of judgment for the whole principal sum and any interest remaining unpaid; or Leland was authorized at his option, to bring an action of ejectment, and authority to confess judgment in such action of ejectment was expressly given by the Saracenos. It was further agreed that in the event of any default by the purchasers, all moneys theretofore paid on the agreement, should become the absolute property of the seller.
The Saracenos entered into possession of the premises on October 28, 1929, and remained in continuous possession up until March 20, 1933, when the dwelling was partially destroyed and greatly damaged by fire.
The Saracenos had made payments called for under the agreement up to October, 1931, of $800, but had defaulted thereafter, and, Leland claimed, had forfeited all their rights in the property.
Notice of the fire was promptly received by the insurance company, for on March 29, 1933 it gave Leland written notice of the cancellation of the policy, with the notation, "The above notice will not affect liability, if any, for loss and damage alleged to have occurred on March 20, 1933."
The insurance company denied liability under the policy on the ground that the fire had occurred by the fraudulent act or connivance of John Saraceno, one of the assured.
Leland brought an action on the policy against the insurance company on March 1, 1934, within a year after the fire. On May 4, 1934 he filed his statement, by which he claimed to recover upon the policy the sum of $811, the amount of the loss or damage to the buildings caused by the fire. A copy of the policy was annexed to the statement as Exhibit A, and made a part *Page 537
thereof. On May 15, 1934 the defendant filed a statutory demurrer, setting up, inter alia, that "the policy attached as Exhibit A and made a part of the Statement shows the Insured to be F.C. Leland and Jiovann (John) and Elizabeth Saraceno, but the statement of claim does not show why John and Elizabeth Saraceno are not made parties plaintiff." On November 15, 1934, the plaintiff presented his petition asking that Jiovann (John) and Elizabeth Saraceno be joined as parties plaintiff in the action. A rule to show cause was granted, which on the return day, November 26, 1934, was made absolute, and on the same day an appearance was entered by an attorney for John and Elizabeth Saraceno, additional plaintiffs, and an amended statement was filed to conform to the amendment of the parties plaintiff. A rule filed on behalf of defendant, to strike off the order of November 26, 1934 permitting the joinder of the Saracenos as parties plaintiff was discharged, and leave was given to file an affidavit of defense within fifteen days. Various other motions and rules were made on behalf of defendant which it is not necessary here to refer to in detail. All of the assured having appeared as plaintiffs to the action it was of no concern to the defendant how any sum that might be recovered in the action was to be divided among them: Hill v. Cumberland Valley MutualProtection Co., 59 Pa. 474; Insurance Co. v. Updegraff, 21 Pa. 513. It was relieved of any possibility of having to pay the insurance twice and the distribution of the sum received among those entitled to it was not its affair. Its concern was to see that it did not have to pay for an incendiary fire; or if not incendiary, that the recovery did not exceed the loss or damage sustained.
The lower court based its action in holding that the amendment, joining the Saracenos as plaintiffs, was too late — having been made more than a year after the date of the fire, and when it was too late, under the conditions *Page 538
of the policy to bring a new action — on our decision in the case of Bowers Co. v. London Assurance Corp., 90 Pa. Super. 121; but, when fully understood, there is nothing in that case to warrant the position taken by the court below. The policy in the Bowers case covered an automobile and it insured "John A. Perry L.S. Bowers Company, as their interests may appear." The automobile insured had been `sold' by the Bowers Company to Perry for $800, of which about $450 was secured by a bailment lease, under which Perry was to keep the car insured against damage by fire, loss, if any, payable to the lessor as its interest might appear. The automobile was destroyed by fire while in Perry's possession but before title to the car had passed to him. The insurance company claimed that the automobile had been fraudulently burned by Perry or by his direction and connivance. L.S. Bowers Co. brought an action in its own name, without joining Perry as a plaintiff, to recover its interest in the car, and secured a verdict and judgment for $270.30. This court reversed, holding that the policy did not insure the interests of the assured separately, but jointly; that as the contract was joint both of the assured must be plaintiffs, and that any fraudulent act of the one which invalidated his right of recovery affected the other, whether or not it had participated in the fraud. No amendment or offer to amend was made in that case, by which Perry would be added as a party plaintiff, possibly because the Bowers Company was unwilling to make its recovery dependent on the good faith and conduct of Perry with regard to the fire. But we did say, (p. 127), "The testimony offered to show the fraudulent burning of the automobile would be admissible uponamendment of the action so as to include both of the assured asplaintiffs," which shows that we regarded it as amendable, in that respect. *Page 539
We recognize fully the rule that an amendment will not be allowed after the statute of limitations has become a bar, which introduces a new and different cause of action or brings new parties into the case to the injury of the defendant, or deprives the latter of a valuable right which had become vested (GrierBros. v. Northern Assurance Co., 183 Pa. 334, 343, 39 A. 10), but in the circumstances of this case that rule is not applicable. The action was on a fire insurance policy insuring F.C. Leland and John and Elizabeth Saraceno, with notice that their respective rights were dependent upon a written contract of sale. They were insured jointly and any act of one of them invalidating the insurance barred the right of recovery of the others. But the policy declared upon made them parties jointly interested, and the mere addition of some of them as plaintiffs did not amount to a new cause of action or the bringing in of new parties to the cause of action declared on. It was merely a correction of the parties to correspond with the instrument sued upon. And it did the defendant no harm, for it made applicable to Leland, as well as the Saracenos, any defense that it might have against the latter because of a fraudulent fire by them or either of them.
The General Assembly, very early, made provision for the amendment of pleadings because of informality (Act of March 21, 1806, Sec. VI, 4 Sm. L. 326, 329) and for the changing or adding of parties (Act of May 4, 1852, P.L. 574, sec. 2). By the latter act it was provided: "That all actions pending, or hereafter to be brought in the several courts of this Commonwealth, and in all cases of judgments entered by confession, the said courts shall have power, in any stage of the proceedings, to permit amendments by changing or adding the name or names of any party, plaintiff, or defendant, whenever it shall appear to them that a mistake *Page 540
or omission has been made in the name or names of any such party."
These statutes have been liberally construed by the Supreme Court and the right to amend a plaintiff's statement, for informality, where the cause of action is not changed, and to bring in additional parties by amendment, by changing or adding a name wherever a mistake or omission has been made, and the opposite party is not injured thereby, has become the settled practice of the appellate courts.
Thus amendments, offered after the time when a new action mighthave been brought, were held proper, — because they made no change in the cause of action, — in the following cases, inter alia: Goldberg v. Friedrich, 279 Pa. 572, 124 A. 186, where the statement was amended by averring specifically a violation by defendant of the Child Labor Act of May 13, 1915, P.L. 286;Armstrong Latta v. City of Phila., 249 Pa. 39, 94 A. 455, where the plaintiffs were allowed to set up an additional element of damage drawn out of the circumstances averred in the statement as originally filed; Coll v. Westinghouse E. M. Co., 230 Pa. 86,79 A. 163, where the amendment restated more accurately the effect produced by a change in a machine; Stoner v. Erisman,206 Pa. 600, 56 A. 77, where a plaintiff was allowed to amend her statement in an action of slander by changing the actionable words from "damned bitch" to "whore and damned bitch"; Booth v.Dorsey, 202 Pa. 381, 51 A. 993, where a statement charging three defendants with a joint negligent act was amended so as to charge it as the separate act of only one of them, eliminating the others; Parsons Trading Co. v. Dohan, 312 Pa. 464, 469,167 A. 310, (DREW, J.), where an amendment was allowed, as to the damages claimed, after verdict and after the statute of limitations had run; Smith v. Bellows, 77 Pa. 441, where a plaintiff was permitted to change his action to tort for deceit *Page 541
instead of assumpsit for money had and received, the facts averred being the same, and the court, speaking through Chief Justice AGNEW, saying: "The test is in the cause of action, not the Statute of Limitations. . . . . . The same circumstances of fraudulent imposition, showing that the defendant had obtained the money of the plaintiff, which ex equo et bono, he ought to return, would support either form of action." In Stainer to useof Northampton Co. B. L. Assn. v. Royal Ins. Co., 13 Pa. Super. 25, an action was brought in the name of the assured as legal plaintiff for the use of a mortgagee to whom the loss was made payable, without assignment, and the amount claimed was only the balance due the mortgagee, $486.46. An amendment was allowed, after the time when a new action might be brought, permitting a claim for the full amount insured under the policy, $800, the difference to go to the legal plaintiff, the assured;Spry, Receiver, to use of Colonial Slate Co. v. Farmers' MutualFire Ins. Co., 101 Pa. Super. 49, (LINN, J.), where we reversed the court below and held that the use plaintiff should have been permitted to amend its statement by averring that written consent to the transfer of the policy to the use plaintiff had been waived by a duly authorized agent of the company.
The same liberality has been shown in permitting changes and additions in the names of plaintiffs, where there was a mistake or omission in bringing suit, in order that the parties plaintiff might correspond with the contract declared on, and the cause of action was not changed nor the defendant injured thereby. SeeHite v. Kier, 38 Pa. 72; Rangler v. Hummel, 37 Pa. 130, 132;Meason v. Kaine, 67 Pa. 126; Windsor Mfg. Co. v. Globe RutgersIns. Co., 277 Pa. 374, 381, 121 A. 328, (SADLER, J.) where it was said: "The contention is made that plaintiff was without insurable interest, since the shipments were f.o.b. Philadelphia. This *Page 542
complaint is without force, in view of the rider attached to the policy by which protection was extended to all interested in the property consigned. If others had any interest, by reason of thepassing of title, their names could be added by amendment, and ifsuch property rights appeared, this would be directed here onappeal." [Italics supplied.]
The legal plaintiff was added by amendment in Walthour v.Spangler, 31 Pa. 523; Barnhill v. Haigh, 53 Pa. 165, where the amendment was allowed in the Supreme Court. See also, Com. exrel. Attorney General v. Dillon, 81 Pa. 41, 44, 45; Patton v.Pittsburgh C. St. L. Ry., 96 Pa. 169; M.E. Church v. EquitableSurety Co., 269 Pa. 411, 415, 112 A. 551; Appleton Cox, Inc. v.Pittsburgh Refrigeration Corp., 118 Pa. Super. 462, 463,179 A. 885.
The action may likewise be amended by adding the name of theuse plaintiffs: Gentile v. P. R. Ry., 274 Pa. 335, 118 A. 223.
The statutes giving a right of action for damages growing out of death by wrongful act (April 15, 1851, P.L. 669, sec. 19, p. 674, April 26, 1855, P.L. 309 and June 7, 1911, P.L. 678, 12 PS secs. 1601, 1602, 1603) specify who must bring the action and provide that it shall be brought within one year after the death and not thereafter. The provisions of the statute, declaring who shall maintain the action and limiting the time within which it may be brought, are of at least as binding effect as the terms of a policy contract adopted by agreement of the parties, yet where an action has been brought by one of two parties entitled to recover under the statute, within a year after the death, it has been held that it may be amended, after the year, by adding the name of the necessary other party; Waltz v. Penna. R. Co.,216 Pa. 165, 65 A. 401; Holmes v. Penna. R. Co., 220 Pa. 189,69 A. 597; Sontum v. Mahoning Shenango Ry. Co., 226 Pa. 230,75 A. 189; Hughes v. Williams, *Page 543 17 Pa. Super. 229. The distinction in these and other actions seems to be that an additional party entitled under the statute, or under the contract in suit, and necessary to a recovery, may be added after the time for bringing suit has expired, but a new party may not be substituted for the plaintiffin the action after the statute of limitations is a bar to the action, (See Com. ex rel. Attorney-General v. Dillon, 81 Pa. 41, p. 45), for that would be changing the cause of action.
This liberality of amendment in present day pleadings is nowhere better shown than in the very recent case of Ronca v.British Foreign Marine Ins. Co., 314 Pa. 449, 451, 452,172 A. 475, where, although the judgment was reversed because of the rejection of certain admissible evidence, the Supreme Court, in an opinion by the present Chief Justice, sustained an action brought by one of two persons, jointly insured under a fire insurance policy covering an automobile, in his own name and asassignee of the other, instead of in their joint names to his use, but not joining, as a party plaintiff, the bailment lessor to whom, under the policy, the loss was made payable; and, further, approved the action of the court below in consolidating the action with a separate action brought by the bailment lessor aforesaid, saying: "This Court has pointed out in many cases, as recently as in Paxos v. Jarka Corp., 314 Pa. 148, that litigation will not be prolonged or confused by insubstantial objections to the form of statement of plaintiffs. The record, if necessary, may be treated as amended in this Court."
The present action was upon the policy, which on its face was payable in case of loss to Leland and the Saracenos, pursuant to a contract of sale between them. Leland, mistakenly relying on the forfeiture clauses in the agreement, brought the action in his own name without joining the Saracenos as plaintiffs, and upon the *Page 544
defendant calling the defect to his attention, he moved to amend the action so as to make the plaintiffs in the action correspond with the assured in the policy contract sued on. There was no substitution of a new party for the plaintiff, but merely the addition of persons jointly interested as the assured in the contract in suit. The cause of action was not changed. It remained as before an action to recover the loss sustained by fire to the premises insured by defendant under the policy in suit. The adding of the persons jointly insured with Leland as parties plaintiff did the defendant no harm; on the contrary it renders any defense which it may have against the Saracenos, because of their fraudulent acts, effective against Leland. The only effect of the amendment is to join on the record as plaintiffs all persons interested as the assured in the policy, which forms the basis of the cause of action, and to subject all of them to the defenses which the defendant may have against the Saracenos or either of them, because of their fraudulent conduct.(Ronca v. British Foreign Marine Ins. Co., supra, p. 452).
The second assignment of error is sustained. The order is reversed. The judgment of non-suit is stricken off and a new trial awarded. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/162696/ | 309 F.3d 1234
In re MINISCRIBE CORPORATION, Debtor.
Thomas H. Connolly, Trustee, Appellant,v.HARRIS TRUST COMPANY OF CALIFORNIA, as Indenture Trustee for the MiniScribe Corporation 7 1/2% Convertible Subordinated Debentures Due 2012, Appellee.
No. 01-1263.
United States Court of Appeals, Tenth Circuit.
October 31, 2002.
COPYRIGHT MATERIAL OMITTED Submitted on the briefs:*
Gregory L. Williams and Donald J. Quigley, Block Markus Williams, Denver, CO, for Appellant.
David P. Hutchinson, Otten, Johnson, Robinson, Neff & Ragonetti, Denver, CO, and James M. Breen, Chapman and Cutler, Chicago, IL, for Appellee.
Before MURPHY, ANDERSON, and HARTZ, Circuit Judges.
STEPHEN H. ANDERSON, Circuit Judge.
1
Thomas H. Connolly, Chapter 7 trustee for the debtor, MiniScribe Corporation, appeals from orders of the district court (1) reversing an order of the bankruptcy court awarding him a trustee's fee of $3,044,953.69, and (2) ordering that he be allowed a fee of $1,828,812. We affirm.
FACTS
2
On January 1, 1990, the debtor filed a voluntary petition in bankruptcy under Chapter 11. It converted the case to a Chapter 7 liquidation on April 16, 1991. Ten days later, Connolly was appointed Chapter 7 trustee.
3
At the time Connolly assumed his duties as trustee, the MiniScribe estate was insolvent. The estate had only $150,000 cash on hand, and faced Chapter 11 administrative expenses exceeding $3.0 million, a superpriority claim against it by Standard Chartered Bank (SCB) in the amount of $17 million, and total claims of approximately $900 million. The only opportunities to develop a bankruptcy estate lay in recoveries on avoidance claims and in a fraud action against former MiniScribe officers and outside accountants and consultants.
4
The bankruptcy court found that Connolly performed admirably in obtaining funds for the estate. He not only convinced SCB to reduce its claim from $17 million to $1 million, but also further persuaded it to loan the estate $1 million to defray the cost of prosecuting its fraud action. This action was eventually settled on terms highly favorable to the bankruptcy estate and its creditors, yielding over $80 million for the payment of claims. Connolly also conducted 45 adversary proceedings that realized over $17 million for the estate and that resulted in the reduction of claims against the estate from approximately $900 million to approximately $168 million. Finally, Connolly settled a recovery action against one of MiniScribe's creditors by taking an equity interest in the creditor which Connolly ultimately sold for over five times the value of the settlement.
5
The bankruptcy court made a number of interim fee payments to Connolly as trustee. In his final fee application, he sought additional compensation that would have resulted in a total fee of $3,044,953. This was the maximum fee permitted at that time under the percentage fee scheme (the "cap") outlined in 11 U.S.C. § 326(a) (1986).1 Appellee Harris Trust Company, representing MiniScribe's debenture holders, opposed the request, as did the United States trustee.
1. First bankruptcy court decision
6
The bankruptcy court carefully analyzed Connolly's fee request and issued an extensive order and opinion approving the statutory maximum payment. Connolly v. Harris Trust Co. (In re Miniscribe Corp.), 241 B.R. 729 (Bankr.D.Colo.1999). The court determined that during his administration, Connolly had disbursed $101,492,332 through his accounts. This amount, which included settlements of fraud actions that the trustee and other litigants had brought against third party defendants, would be used in calculating the statutory maximum under the "cap" set out in § 326(a).
7
The bankruptcy court next applied a lodestar analysis, focusing on a reasonable number of hours spent by the trustee on his duties multiplied by a reasonable hourly rate. It noted that Connolly's time records reflected 1,779 hours spent on the case, along with an additional 1,347 hours spent by his paralegals. The bankruptcy court concluded that this amount of time, however, was misleadingly low because Connolly had performed more efficiently than expected. It rejected the objectors' position that the hourly rate should be differentiated, with a rate of $1,000 to $1,500 awarded for time spent on the fraud litigation and a more modest rate of $250 awarded for time spent on other activities. The court determined that a uniform, reasonable hourly rate of $500 should be applied to the 1,779 hours reasonably expended by Connolly, resulting in a lodestar fee of $889,500.
8
The court next adjusted the lodestar fee by considering the factors outlined in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.1974). It determined that these factors (novelty and difficulty of the issues; requisite skill; preclusion of other employment; contingent nature of the fee; time limitations; amount involved and results obtained; and the experience, reputation, and ability of the trustee) justified a lodestar multiplier of 3.5, resulting in a total fee of $3,113,250.
9
Alternatively, the court applied a "common fund" or "percentage of the fund" analysis to arrive at an appropriate fee. If the trustee were allowed his claimed fee of $3,044,954, the total adjusted costs for raising and administering the "common fund" of the bankruptcy estate would be $10,864,402, approximately 10.7 percent of the total funds ($101,492,456) that had been administered by the trustee. This percentage, the bankruptcy court determined, was well within the range of permissible costs on a percentage basis.
2. First district court decision
10
Harris Trust appealed from the bankruptcy court's award. In an unpublished order and judgment, the district court rejected application of the common fund analysis under the circumstances of this case. Under a common fund theory, the court reasoned, the entire cost of recovery of the amount disbursed by Connolly would be borne by the only remaining creditors, the subordinated debenture holders. Moreover, Connolly was not solely responsible for creation of the fund; the plaintiffs whose fraud claims had been consolidated with his own had also been represented by able counsel and the bankruptcy court had not factored in the fees, costs and expenses paid to them.
11
The district court also rejected the $500 per hour unified lodestar rate as lacking in evidentiary support. It found the 3.5 multiplier unjustified because it overstated the risk of non-payment to Connolly, ignored the routine nature of much of the work he had performed, and overlooked the contribution of the trustee's counsel and counsel for the other fraud plaintiffs to the recovery of the fund. The bankruptcy court would have to recalculate the adjusted lodestar amount on remand.
12
Finally, the district court addressed the statutory cap. It found that MiniScribe's bankruptcy estate had been unusual because of the amount of money passing through the trustee's accounts and because of the circumstances surrounding those disbursements. It noted that $70 million of the approximately $101 million that had passed through the trustee's accounts had been paid to other parties who had consolidated their fraud actions with the trustee's fraud action for purposes of trial. The correct measure of the results achieved for purposes of computing the statutory cap lay somewhere between the $31.5 million contended for by Harris Trust, and the $101.5 million figure adopted by the bankruptcy court. The precise figure was left to be calculated by the bankruptcy court on remand.
3. Second bankruptcy court decision
13
The bankruptcy court held further hearings on remand and took up the fee issues in a second published decision, Connolly v. Harris Trust Co. (In re MiniScribe Corp.), 257 B.R. 56 (Bankr.D.Colo.2000). It recalculated the size of the estate, leaving a figure of $67.4 million attributable to Connolly's efforts.
14
The bankruptcy court did not read the district court's order to preclude application of a common fund analysis; it believed the district court had only rejected its application based on the bankruptcy court's prior findings. Therefore, having adjusted these findings, the bankruptcy court once again applied a common fund percentage analysis to the $67.4 million estate realized by Connolly's efforts. Assuming Connolly were awarded the $3.04 million he sought, the $10.86 million total administrative burden would still be within a reasonable range under a common fund analysis.
15
The bankruptcy court next turned to the lodestar analysis. Addressing the district court's criticism of its previous effort, it conceded that there was no direct support for the $500 per hour figure in the record. Upon consideration of Connolly's highly responsible role and the fees charged by other professionals, however, the bankruptcy court determined that while a fee of $500 per hour would not be unreasonable, a rate of $400 per hour would also be reasonable. Applied to the 1,779 hours accounted for by Connolly, the base lodestar amount would be $711,600.
16
The bankruptcy court next turned to the district court's criticism of its use of a 3.5 lodestar multiplier. After again analyzing the trustee's contribution to and success achieved in the case, it concluded that a multiplier of 2.57 would be appropriate. Thus, the adjusted lodestar fee would be $1,828,812. Once again, however, the bankruptcy court concluded that the lodestar fee was not the appropriate measure of reasonable compensation; instead, it allowed a larger amount of $3,044,953.69, calculated under a common fund approach.
4. Second district court decision
17
Harris Trust again appealed from the bankruptcy court's award. The district court again concluded that a common fund analysis was inappropriate in this case. It found that there was no way to quantify Connolly's contribution to the bankruptcy estate that would be comparable to the fund creation theory supporting application of the common fund method. The district court opined that the lodestar method, rather than the common fund method, was the appropriate measure of compensation for this case. It concluded that the adjusted lodestar fee of $1,828,812 arrived at by the bankruptcy court in its second decision constituted a reasonable fee within its sound discretion.
ANALYSIS
1. Standard of review
18
The district court's first order was not a final, appealable decision under 28 U.S.C. § 158(d), because it remanded the case to the bankruptcy court for "significant further proceedings" of a discretionary nature. Office of Thrift Supervision v. Overland Park Fin. Corp. (In re Overland Park Fin. Corp.), 236 F.3d 1246, 1251 (10th Cir.2001). Connolly's appeal from the district court's second, final order, however, permits us to address issues pertaining to both orders, as he requests. See Masunaga v. Stoltenberg (In re Rex Montis Silver Co.), 87 F.3d 435, 437-38 (10th Cir.1996).
19
Our review of the bankruptcy court's decision is governed by the same standards of review that govern the district court's review of the bankruptcy court. Accordingly we review the bankruptcy court's legal determinations de novo and its factual findings under the clearly erroneous standard. A finding of fact is clearly erroneous if it is without factual support in the record or if, after reviewing all of the evidence, we are left with the definite and firm conviction that a mistake has been made.
20
Conoco, Inc. v. Styler (In re Peterson Distrib., Inc.), 82 F.3d 956, 959 (10th Cir.1996) (citations omitted).
21
Seeking to reap the deferential standard of review accorded to the bankruptcy court's factual findings favorable to his position, Connolly paints all the underlying issues here as factual. He contends that the district court improperly supplanted the bankruptcy court's factual findings concerning the comparable non-bankruptcy cost of his services, a reasonable hourly rate for his services, and the contingent nature of his fee. Harris Trust, by contrast, argues that this case also presents an important legal issue requiring our de novo review. It asks whether a bankruptcy trustee who does not act as his own litigation counsel may ever be compensated based on a percentage-of-the-fund (common fund) methodology. We will exercise de novo review to conclude that under the applicable statutes common fund methodology is not an appropriate form of compensation for a Chapter 7 trustee.
2. Statutory authority
22
Authority for payment of a reasonable fee to a Chapter 7 trustee is found in 11 U.S.C. §§ 326 and 330. Section 330(a) provides that a bankruptcy court may award a trustee
23
(1) reasonable compensation for actual, necessary services rendered by such trustee ... and by any paraprofessional persons employed by such trustee ... based on the nature, the extent, and the value of such services, the time spent on such services, and the cost of comparable services other than in a case under this title; and
24
(2) reimbursement for actual, necessary expenses.
25
Section 326(a) provides a formula that limits the compensation of a Chapter 7 trustee arrived at under § 330: In a case under chapter 7 ... the court may allow reasonable compensation under section 330 of this title of the trustee for the trustee's services, payable after the trustee renders such services, not to exceed fifteen percent on the first $1,000 or less, six percent on any amount in excess of $1,000 but not in excess of $3,000, and three percent on any amount in excess of $3,000, upon all moneys disbursed or turned over in the case by the trustee to parties in interest, excluding the debtor, but including holders of secured claims.
26
Under this standard, § 326(a) sets the maximum compensation payable to the trustee; it does not establish a presumptive or minimum compensation.
27
The computation in [§ 326(a)] is a limitation on compensation, not a mandate for minimum commissions. The section states that the court may allow only "reasonable compensation under section 330." Thus, the cap of section 326(a) is implicated only when the compensation is reasonable, and reasonableness is a determination that must begin with 11 U.S.C. § 330.
28
In re Butts, 281 B.R. 176, 178 (Bankr.W.D.N.Y.2002).
29
Accordingly, a court awarding trustee fees must begin by assessing reasonableness under § 330(a) before applying the percentage-based cap under § 326(a).
3. Common fund theory
30
The common fund doctrine was first recognized by the Supreme Court in Trustees v. Greenough, 105 U.S. 527, 26 L.Ed. 1157 (1881), and most recently discussed in Boeing Co. v. Van Gemert, 444 U.S. 472, 100 S.Ct. 745, 62 L.Ed.2d 676 (1980). Essentially, the doctrine holds that "a litigant or lawyer who recovers a common fund for the benefit of persons other than himself or his client is entitled to a reasonable attorney's fee from the fund as a whole." Boeing, 444 U.S. at 478, 100 S.Ct. at 749. It is most appropriate when (1) the class of persons benefitted by the lawsuit is small and easily identifiable, (2) the benefits can be traced with some accuracy, and (3) the costs of the litigation can be shifted accurately to those who profit by it. This is an equitable doctrine, and is usually justified on the ground that it prevents unjust enrichment of the non-litigants, who have taken a free ride on the trailblazer's efforts. Jurisdiction over the fund enables a court to prevent such inequity by assessing fees out of the entire fund, spreading the burden proportionately among those benefitted.
31
Matter of Fesco Plastics Corp., 996 F.2d 152, 157 (7th Cir.1993) (further citations omitted).
32
As Connolly notes, we have approved the use of common fund methodology to award attorneys whose efforts created a fund benefitting persons other than themselves or their clients. See, e.g., Gottlieb v. Barry, 43 F.3d 474, 487-88 (10th Cir.1994). This case, however, presents a different issue: whether a percentage-based approach analogous to the equitable doctrine of common fund has a place in establishing "reasonable" statutory compensation for a Chapter 7 trustee.
33
The available authority on this question is quite limited. What authority there is divides sharply on the question. Recognizing this fact, a national report on professional compensation in bankruptcy cases takes an agnostic approach to the question:
34
[I]t appears that a majority [of courts] employ the lodestar approach to trustees' fee determinations. Some courts, however, reject that approach as inappropriate in light of the significant difference between the functions performed by trustees and those performed by the professionals employed by trustees. In these courts especially, the results obtained in the case play a far greater role in determining reasonable compensation for trustees than they do with respect to the compensation of professionals.
35
Am. Bankr.Inst., American Bankruptcy Institute National Report on Professional Compensation in Bankruptcy Cases (G.R. Warner rep.1991), at 206.
36
We have found no cases in this circuit that discuss whether a common fund or other percentage-based rationale may be used in setting trustee compensation under § 330. Connolly cites a case specifically endorsing a common fund or percentage-based approach for trustee compensation, In re Guyana Development Corp., 201 B.R. 462 (Bankr.S.D.Tex.1996). Harris Trust responds with a case in which a trustee's common fund argument was rebuffed, In re Marvel Entertainment Group, 234 B.R. 21 (Bankr.D.Del.1999).
37
In Guyana Development, the bankruptcy court rejected a lodestar approach and awarded the trustee a percentage based fee analogous to a common fund recovery, measured by the maximum permitted under 11 U.S.C. § 326. The methodology employed in Guyana Development has been seriously criticized, however, because the court applied a "sliding scale" approach that essentially incorporated the maximum permitted compensation (calculated on a percentage basis by statute) into the calculation of a "reasonable fee." See In re Neill, 242 B.R. 685, 689 (Bankr.D.N.D.1999); Marvel Entertainment, 234 B.R. at 38-39. For this reason, we do not find Guyana Development persuasive.
38
In Marvel Entertainment, by contrast, the district court rejected a trustee's request for a percentage-based fee. In its well-reasoned decision, the court gave several reasons for rejecting the request, many of which are also applicable here: (1) section 326 serves only as a cap and does not establish the trustee's entitlement to a commission or percentage of amounts disbursed from the estate; (2) there is no principled relationship between the amounts disbursed by a debtor corporation and reasonable compensation based on the trustee's actual efforts; (3) there is no support in case law for a common fund approach; (4) setting reasonable compensation based on a percentage of the debtor's disbursements would create a substantial risk of abuse in the selection and appointment of trustees by the United States trustee; and (5) a percentage compensation approach could discourage courts from appointing a trustee when it might otherwise be appropriate. Marvel Entertainment, 234 B.R. at 38-40.
39
Turning to the statutory language, § 330 requires a court awarding trustee's fees to consider "the nature, the extent, and the value of such services, the time spent on such services, and the cost of comparable services other than in a case under this title." 11 U.S.C. § 330(a)(1). The "cost of comparable services" factor plays an "overarching role" in assessing the reasonableness of a trustee's fee, given the nature and extent of the services rendered. Staiano v. Cain (In re Lan Assoc. XI, L.P.), 192 F.3d 109, 124 n. 9 (3d Cir.1999).
40
Connolly argues that the "cost of comparable services" factor should take into account the fact that attorneys can and do receive a common fund or percentage-based recovery in non-bankruptcy cases. See, e.g., Brown v. Phillips Petroleum Co., 838 F.2d 451, 454 (10th Cir.1988). This argument, however, begs an essential question: whether the services provided by a trustee are "comparable" to those provided by an attorney in such cases. It is far from clear that they are. Trustees do not have to be attorneys; indeed, the two serve considerably different functions. See Guyana, 201 B.R. at 479 & n. 11. An attorney who serves as a trustee, in fact, may not be paid attorney's fees for performing duties that properly belong to his role as trustee. 11 U.S.C. § 328(b).
41
Where the "common fund" has been created through litigation, the distinction is particularly apt. An attorney litigating a case to judgment supplies a significantly different expertise and function than that of a trustee. The contingent fee trial lawyer generally advances his own money to finance litigation. He enters his appearance before a court and does every task that the litigation requires, personally or through other attorneys he employs, from drafting the complaint to making the closing argument. Having entered his appearance, he has no right to withdraw and his time commitment is not limited or flexible. The trustee, by contrast, serves as a fiduciary whose non-bankruptcy counterpart is a receiver, an executive or an in-house counsel. He is the litigator's client and has a right to periodic compensation, such as Connolly received here.
42
Where, as here, the fund was created through negotiation by the trustee in connection with the litigation, there may be more overlap between the functions of trustee and attorney. Nevertheless, the overriding differences between the functions of an attorney and a trustee lead us to conclude that cases in which an attorney has been paid on a percentage basis for creating a common fund do not represent the "comparable cost" of a trustee's services, even where those services may have contributed to the creation of the fund.
43
Section 330 also requires the court to consider "the time spent on such services." If reasonable compensation for a trustee were predicated solely on a common fund recovery, this factor could improperly be shortchanged.2
44
While it cannot be denied that results obtained is a factor to be considered in assessing the reasonableness of trustee compensation, see, e.g., In re Rauch, 110 B.R. 467, 473-74 (Bankr.E.D.Cal.1990), we believe this factor is better considered as merely one of the Johnson criteria for determining the multiplier, if any, to be applied to the lodestar amount, rather than the sine qua non of the reasonableness calculation.
45
For all the foregoing reasons, we reject a "common fund" or percentage-based rationale for calculating reasonable trustee compensation under § 330.
4. Lodestar calculation
46
Having determined that percentage-based compensation is unavailable under § 330, we turn to the appropriate basis for calculation of the fee. We conclude that the lodestar test, with appropriate enhancements under Johnson, is the appropriate method of calculation. This method encompasses each of the factors identified in § 330(a), as well as other factors that may be relevant in calculating a reasonable fee.
47
The lodestar test is presently used as the dominant method for assessing fees in fee-shifting disputes in federal court. See generally, Gisbrecht v. Barnhart, 535 U.S. 789, ___, 122 S.Ct. 1817, 1825, 152 L.Ed.2d 996 (2002). Strictly speaking, trustee's fees in bankruptcy do not involve a fee-shifting rationale. This court has long applied the Johnson lodestar factors to assess "reasonableness" of attorney's fees in a variety of contexts, however, and has also specifically determined that the test applies to attorney fee determinations under § 330(a)(1). Rubner & Kutner, P.C. v. United States Trustee (In re Lederman Enters., Inc.), 997 F.2d 1321, 1323 (10th Cir.1993) (attorney's fees); see also generally First Nat'l Bank of Lea County v. Niccum (In re Permian Anchor Servs., Inc.), 649 F.2d 763, 768 (10th Cir.1981). Other courts have applied an adjusted lodestar test, based on the Johnson factors, to trustee compensation under § 330(a). See, e.g., Garb v. Marshall (In re Narragansett Clothing Co.), 210 B.R. 493, 497 (1st Cir.BAP1997); In re Draina, 191 B.R. 646, 649 (Bankr.D.Md.1995). We therefore apply the adjusted lodestar test here.
48
At the outset, we note Harris Trust's failure to cross-appeal from either the hourly rate determined by the district court, or the multiplier it applied. Given the fact that Harris trust did not cross-appeal, our review is limited only to determining whether the record justifies the increase in either the hourly rate or the multiplier contended for by Connolly. We have no occasion to consider whether a reduction might be required on this record.
49
a. Hourly rate and hours expended
50
Judicial review of the bankruptcy court's factual determinations in connection with a fee award is highly deferential:
51
When we scrutinize factual determinations and discretionary determinations made by a bankruptcy judge, such as may be involved in calculating and fashioning appropriate fee awards, we give considerable deference to the bankruptcy court[.] Historically, bankruptcy courts have been accorded wide discretion in connection with fact-intensive matters, and in regard to the terms and conditions of the engagement of professionals.... The bankruptcy judge is on the front line, in the best position to gauge the ongoing interplay of factors and to make the delicate judgment calls which such a decision entails.
52
Casco N. Bank, N.A. v. DN Assoc. (In re DN Assoc.), 3 F.3d 512, 515 (1st Cir.1993) (quotation omitted).
53
The bankruptcy court initially determined that a uniform, reasonable hourly rate of $500 should be applied to the 1,779 hours reasonably expended by Connolly, resulting in a basic lodestar fee of $889,500. The district court rejected the $500 per hour rate as unsupported, concluding that the hourly rates used should vary according to the work done. When upon remand the bankruptcy court adjusted the hourly rate to a uniform $400 per hour, however, the district court abandoned the variable rate concept and approved the lower, uniform rate.
54
A Chapter 7 trustee does perform a variety of functions in his role, including investigating, liquidating, and distributing estate assets. In re Colburn, 231 B.R. 778, 783 (Bankr.D.Ore.1999) (citing 11 U.S.C. § 704). Where the trustee has performed work that differs in complexity, a solution is to adjust his fee as a whole, to arrive at a "blended" rate. Garb, 210 B.R. at 499. We agree that the appropriate approach here was a unified rate for all of the trustee's services.
55
The record, however, does not justify the rate of $500 per hour that Connolly seeks. This is true for several reasons. First, the bankruptcy court rejected expert testimony Connolly presented to justify a rate of $500 per hour. Second, it found that the top rate generally charged by private attorneys for bankruptcy work in the area was $350 per hour. MiniScribe, 257 B.R. at 62. The bankruptcy court acknowledged the absence of specific evidence from which a rate of $500 per hour could be justified. Given that Harris Trust has not cross-appealed the district court's determination that $400 per hour was a reasonable rate, however, we will affirm that determination as unchallenged.
56
b. Lodestar multiplier
57
The bankruptcy court further concluded, in light of the exceptional results obtained in this case and other Johnson factors, that a multiplier was required to adequately compensate Connolly for his efforts. The district court disapproved of a 3.5 multiplier, however, concluding that the bankruptcy court had overstated the risk of non-payment run by Connolly. We also conclude that the 3.5 multiplier was excessive. The 3.5 multiplier risks double payment or overpayment for the services provided. Cf., e.g., Rosenbaum v. MacAllister, 64 F.3d 1439, 1447-48 (10th Cir.1995) (stating "our conscience is shocked by an award of a 3.16 multiplier that results in a fee equal to more than $900 per hour for every attorney, paralegal, and law clerk who worked on the case").
58
In its second decision, the bankruptcy court lowered the multiplier to 2.57, relying on the multiplier used for the attorney fee award in Gottlieb v. Wiles, 150 F.R.D. 174 (D.Colo.1993), subsequently reversed for application of a common fund award in Gottlieb v. Barry, 43 F.3d 474 (10th Cir.1994). The 2.57 multiplier, unchallenged by Harris Trust, finds some support in other lodestar multiplier cases. See, e.g., In re Computron Software, Inc., 6 F.Supp.2d 313 (D.N.J.1998) (applying, in securities fraud class action, lodestar test as cross check for common fund recovery and finding 2.5 multiplier "fair"); In re Biskup, 236 B.R. 332, 337 (Bankr.W.D.Pa. 1999) (applying fee that worked out to 2.76 multiplier for exceptional work by trustee in discovery and preservation of asset in bankruptcy case). Given the strong findings by the bankruptcy court in support of its determination that the results achieved were sufficiently extraordinary to justify a multiplier, and the reasoning of the district court flowing from these findings, we cannot conclude, based on our standard of review, that the district court erred by applying a 2.57 lodestar multiplier.
59
Harris Trust contends that Connolly improperly awarded himself the full $3,044,953.69 nearly three years ago, and should be compelled to disgorge any excess amounts, plus interest. These are matters that can be determined in further proceedings. The judgment of the United States District Court for the District of Colorado is AFFIRMED. Appellant's motion to file a supplemental appendix is granted; as is appellee's motion for leave to file a surreply.
Notes:
*
After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist the determination of this appealSee Fed.R.App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is therefore ordered submitted without oral argument.
1
Both sections 326 and 330 were amended in 1994 as part of the Bankruptcy Reform Act of 1994, Pub.L. No. 103-394, 108 Stat. 4106; however, the amendment does not apply to this Chapter 7 case, filed prior to the amendmentPritchard v. United States Trustee (In re England), 153 F.3d 232, 234 n. 2 (5th Cir.1998).
2
The fact that attorneys and other professionals working for the trustee are sometimes paid on a contingent fee basis, even though § 330 also applies to them, is not dispositive. The bankruptcy code specifically permits a trustee to employ an attorney on a contingent fee basis. 11 U.S.C. § 328(a). No such specific authorization, however, is provided in the case of trustees
HARTZ, Circuit Judge, concurring specially:
60
I concur in the result and join all of Judge Anderson's opinion except the dictum regarding the propriety of the lodestar multiplier. Because Harris Trust did not cross appeal, we need not decide whether the multiplier used by the district court was too high. I would refrain from asserting that the district court did not err in using a 2.57 multiplier. That assertion is both unnecessary and questionable.
61
My first disagreement with the majority is that I do not think the considerations set forth in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir.1974), are "criteria for determining the multiplier." Op. at 17. The appropriate use for almost all the factors listed in Johnson is to determine the attorney's hourly rate and the reasonableness of the number of hours expended on the case; to consider those factors again in setting a multiplier would constitute double counting. Indeed, Johnson itself does not discuss the use of a multiplier.
62
As for the one Johnson criterion relied upon by the majority in approving the multiplier here—"the results achieved," Op. at 21—I question whether that is an appropriate consideration in this case. A bonus for extraordinary results looks a lot like a contingency fee; in both circumstances the fee depends upon the result. To use a multiplier for "extraordinary results" in effect grants a contingency enhancement for any recovery beyond "expected" results. Yet the Supreme Court in Burlington v. Dague, 505 U.S. 557, 112 S.Ct. 2638, 120 L.Ed.2d 449 (1992), rejected the use of a contingency enhancement in setting a reasonable attorney fee under federal fee-shifting statutes. Although the statute providing for a trustee's fee might be distinguished from such fee-shifting statutes, the discussion of contingency enhancements in Dague should give a court pause before approving any result-based enhancement in setting a "reasonable fee." The Court wrote:
63
We note at the outset that an enhancement for contingency would likely duplicate in substantial part factors already subsumed in the lodestar. The risk of loss in a particular case (and, therefore, the attorney's contingent risk) is the product of two factors: (1) the legal and factual merits of the claim, and (2) the difficulty of establishing those merits. The second factor, however, is ordinarily reflected in the lodestar—either in the higher number of hours expended to overcome the difficulty, or in the higher hourly rate of the attorney skilled and experienced enough to do so. Taking account of it again through lodestar enhancement amounts to double counting.
64
The first factor (relative merits of the claim) is not reflected in the lodestar, but there are good reasons why it should play no part in the calculation of the award. It is, of course, a factor that always exists (no claim has a 100% chance of success), so that computation of the lodestar would never end the court's inquiry in contingent-fee cases. Moreover, the consequence of awarding contingency enhancement to take account of this "merits" factor would be to provide attorneys with the same incentive to bring relatively meritless claims as relatively meritorious ones. Assume, for example, two claims, one with underlying merit of 20%, the other of 80%. Absent any contingency enhancement, a contingent-fee attorney would prefer to take the latter, since he is four times more likely to be paid. But with a contingency enhancement, this preference will disappear: the enhancement for the 20% claim would be a multiplier of 5 (100/20), which is quadruple the 1.25 multiplier (100/80) that would attach to the 80% claim. Thus, enhancement for the contingency risk posed by each case would encourage meritorious claims to be brought, but only at the social cost of indiscriminately encouraging nonmeritorious claims to be brought as well. We think that an unlikely objective of the "reasonable fees" provisions.
65
Id. at 562-63, 112 S.Ct. 2638 (citations omitted).
66
The analysis is essentially the same when the multiplier relates only to recovery that exceeds the expected result. Like the situation considered in Dague, the risk of not recovering more than the expected result arises from (1) "the legal and factual merits of the claim [or claims]" for more than the expected result and (2) "the difficulty of establishing those merits." 505 U.S. at 562, 112 S.Ct. 2638. Regarding the second factor, to the extent that the result is extraordinary because of the talent and energy of counsel, the lodestar computation should have already taken that talent and energy into consideration in setting the hourly rate and fixing the reasonable number of hours expended. As for the first factor, to the extent that the result is extraordinary because of the relative lack of merit of the claims for more than the expected result, awarding a multiplier encourages the expenditure of excessive resources on claims that, because of their lack of merit, present a relatively small opportunity for better-than-expected results.
67
Perhaps there are sound reasons for distinguishing Dague from the present situation. But at the least, the issue is a subtle one. Resolving it requires more guidance than is provided by the briefs before us. I therefore express no view on whether the 2.57 multiplier was reasonable. | 01-03-2023 | 08-14-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/161970/ | F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
JAN 31 2002
TENTH CIRCUIT
PATRICK FISHER
Clerk
KODI A. THOMAS,
Plaintiff-Appellant, No. 01-3276
v. (D.C. No. 00-CV-3259-GTV)
(FNU) CARSON, 1st Sergeant; (FNU) (D. Kansas)
SOUKUP, Colonel; (FNU) JONES,
Colonel; AL HUNGERFORD, Unit
Team Manager; and (FNU)
VANMOOSE, Unit Team Counselor,
Defendants-Appellees.
ORDER AND JUDGMENT *
Before SEYMOUR and McKAY, Circuit Judges, and BRORBY, Senior Circuit
Judge.
After examining the briefs and the appellate record, this panel has
determined unanimously that oral argument would not materially assist the
determination of this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G).
The case is therefore ordered submitted without oral argument.
This is a pro se state prisoner 42 U.S.C. § 1983 civil rights appeal. Mr.
*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
Thomas seeks damages and injunctive relief on his claim that prison officials are
not adequately protecting him or his family from harm. The district court denied
Mr. Thomas’s motion for a temporary restraining order or preliminary injunction
for failure to show that he is facing actual and imminent harm. The district court
dismissed Mr. Thomas’s complaint for failure to exhaust administrative remedies,
noting that Mr. Thomas did not have standing to raise the issue of failure to
protect his family. Mr. Thomas appealed to this court.
Mr. Thomas’s constitutional claims require him to exhaust available
administrative remedies. See Booth v. Churner, 532 U.S. 731 (2001). We agree
with the district court that, since Mr. Thomas failed to pursue his grievances to
the Secretary of the Kansas Department of Corrections, he failed to exhaust
available administrative remedies. Therefore, his complaint must be dismissed. 1
We review a district court’s denial of a preliminary injunction for an abuse
of discretion. Duvall v. Keating, 162 F.3d 1058, 1062 (1998). Mr. Thomas’s
request for a temporary restraining order or preliminary injunction requires him to
show that four conditions are met: (1) irreparable harm to Mr. Thomas if the
injunction is not granted; (2) a substantial likelihood that he will prevail on the
merits; (3) threatened injury to Mr. Thomas outweighs possible harm to the
1
We are in receipt of Mr. Thomas’ “Affadavit for Safety II.” Mr. Thomas
is still required to exhaust available administrative remedies before pursing his
claims in federal court.
-2-
opposing party if the injunction is granted; and (4) that the injunction would not
be contrary to the public interest. ACLU v. Johnson, 194 F.3d 1149, 1155 (1999).
As evidenced above by our denial of Mr. Thomas’s appeal, Mr. Thomas has not
made the requisite showing that he is likely to succeed on the merits of his
constitutional claims. Therefore, we cannot say that the district court abused its
discretion in denying Mr. Thomas’s motion.
After a thorough review of the briefs and the record, and for substantially
the same reasons set forth in the district court’s well-reasoned July 26, 2001
Order, we hold that no relief is available to Mr. Thomas.
Appellant’s complaint is DISMISSED. Appellant’s motion for a temporary
restraining order or preliminary injunction is DENIED.
We remind Appellant that because his motion to proceed in forma pauperis
on appeal was granted, he must continue making partial payments on court fees
and costs previously assessed until such have been paid in full.
Entered for the Court
Monroe G. McKay
Circuit Judge
-3- | 01-03-2023 | 08-14-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3854471/ | Argued July 12, 1932.
The defendant was charged with neglecting and refusing to contribute to the support of his bastard child under the Act of July 11, 1917, P.L. 773, amended July 21, 1919, P.L. 1075. When the case was on trial, after the mother of the child testified, the defendant offered in evidence a release signed by her on the day the child was born whereby, for sixty-five dollars paid to her, she released the defendant of all criminal and civil actions "for or on account of the birth, maintenance, education and bringing-up of the child about to be born." The court declined to receive the release. This action of the court the appellant, the defendant, claims was error. In the offer of the paper there was included the statement that there was no proof presented that the Commonwealth was supporting the child or was asked to do so.
A contract binding the defendant to future payments for the support of his bastard child is enforceable in a civil action by the mother, and unless there is some fatal objection to its validity, will be recognized by the courts, and is legal as far as the parties are individually concerned. Such contracts have not only been permitted but have been favored by our courts: Rohrheimer v. Winters, 126 Pa. 253. *Page 435
Such contract, however, is no bar to a criminal action for fornication and bastardy. The criminal action is for the protection of the public: Commonwealth v. Scott, 7 Pa. Super. 590.
In 7 C.J. 969, the law is stated as follows, and a number of cases cited in support of the text. "Except where forbidden by statute the mother of an illegitimate child may by a fair settlement with the putative father for a reasonable consideration preclude herself." The offense in the present case is not fornication and bastardy but, as already stated, neglecting to support a bastard child, and there is no reason why, as in fornication and bastardy cases, contracts between the individuals interested should not be recognized by the court. The defendant may show that he has discharged his duty and has reasonably contributed to the child's support, or may show that the mother is able to support the child, and has by her valid act released him from all further obligations in the premises. If, however notwithstanding such release, the mother is unable to support the child and it becomes a public charge, the right to require the father to support the bastard still resides in the proper authorities, for they are not a party to the contract. We will send the case back in order that upon a retrial the release, if offered, may be received. The inquiry will then be whether there be any fatal objection to its validity. All the circumstances surrounding the giving of the release may be inquired into. The amount of $65 seems to be unconscionable as a consideration for lying in expenses and the support of the infant for the usually long term of years fixed by the courts in such cases. The obtaining of a release on the very day the child was born would appear to require explanation. It may be that the testimony as to the giving of the release may disclose that no advantage was taken of the prosecutrix in its procuring, and that under the circumstances the whole transaction was *Page 436
fair and the consideration commensurate, and furthermore that the child is not dependent on public support by reason of the mother being indigent. The defendant is entitled to submit proof in the attempt to sustain his defense. If upon a retrial, the defendant should be found guilty, the sentence should not include lying in expenses or maintenance prior to the prosecution, as such are not included in the provisions of the act: Com. v. Maddox, 100 Pa. Super. 147.
The judgment is reversed with a procedendo. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/155134/ | 120 F.3d 270
NOTICE: Although citation of unpublished opinions remains unfavored, unpublished opinions may now be cited if the opinion has persuasive value on a material issue, and a copy is attached to the citing document or, if cited in oral argument, copies are furnished to the Court and all parties. See General Order of November 29, 1993, suspending 10th Cir. Rule 36.3 until December 31, 1995, or further order.
INTRUST BANK, N.A. of Wichita Kansas, Convervator of IanAngus Upchurch, a minor; George F. Upchurch; andLori Upchurch, Plaintiffs-Appellants,v.Robert D. OLIVER, M.D., Robert D. Oliver, M.D., an OklahomaCorporation; and Jane Phillips EpiscopalHospital, Inc., and OklahomaCorporation, Defendants-Appellees.
No. 95-5176.
(D.C.No. 93-C-533-B)
United States Court of Appeals, Tenth Circuit.
July 31, 1997.
Before ANDERSON, BALDOCK, and EBEL, Circuit Judges. CC ORDER AND JUDGMENT*
1
Plaintiffs brought this diversity action under 28 U.S.C. § 1332 alleging that Defendants negligently managed the labor and delivery of Lori Upchurch on July 15, 1986, which resulted in permanent and irreversible brain damage to her son, Ian Upchurch. Following a twelve day trial, the jury returned a verdict in favor of Defendants. The district court subsequently denied Plaintiffs' motion for a new trial. Fed.R.Civ.P. 59. Plaintiffs now appeal from the unfavorable jury verdict on their medical malpractice claim arguing the district court denied them a fair trial. Plaintiffs proffer eight reasons why we should overturn the jury's verdict and award them a new trial. According to Plaintiffs, the district court improperly (1) placed time restrictions on the presentation of their case; (2) failed to address juror bias; (3) permitted defense counsel to make prejudicial remarks in opening and closing arguments; (4) allowed defense counsel to introduce inadmissible evidence during trial; (5) engaged in conduct demonstrating bias; (6) failed to strike defense testimony in violation of its sequestration order; (7) refused to amend the pretrial conference order to conform to the evidence; and (8) refused to instruct the jury on the issue of informed consent. Our jurisdiction to review Plaintiffs' claims arises under 28 U.S.C. § 1291.
2
We have reviewed the parties' briefs and the record before us, and carefully considered each of Plaintiffs' arguments. Because we find nothing in the record which constitutes reversible error, we affirm the judgment of the district court.
3
AFFIRMED.
*
This order and judgment is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel. The court generally disfavors the citation of orders and judgments; nevertheless, an order and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3 | 01-03-2023 | 08-14-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/4523660/ | MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D),
this Memorandum Decision shall not be FILED
regarded as precedent or cited before any Apr 08 2020, 11:59 am
court except for the purpose of establishing CLERK
Indiana Supreme Court
the defense of res judicata, collateral Court of Appeals
and Tax Court
estoppel, or the law of the case.
ATTORNEY FOR APPELLANT ATTORNEYS FOR APPELLEE
Leanna Weissmann Curtis T. Hill, Jr.
Lawrenceburg, Indiana Attorney General
Robert J. Henke
Deputy Attorney General
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
In re the Termination of the April 8, 2020
Parent-Child Relationship of Court of Appeals Case No.
K.R.L.F., N.F., Kev.F., Ke.F., 19A-JT-2165
and Kr.F. (Minor Children) and Appeal from the
A.F. (Mother), Parke Circuit Court
The Honorable
Samuel Swaim, Judge
A.F. (Mother), Trial Court Cause Nos.
Appellant-Respondent, 61C01-1904-JT-53
61C01-1904-JT-54
v. 61C01-1904-JT-55
61C01-1904-JT-56
61C01-1904-JT-57
Indiana Department of Child
Services,
Appellee-Petitioner
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 1 of 13
Vaidik, Judge.
Case Summary
[1] A.F. (“Mother”) appeals the termination of her parental rights to her five
children. We affirm.
Facts and Procedural History
[2] The facts that follow are taken primarily from the trial court’s findings of fact,
none of which Mother challenges on appeal.1 Mother and K.F. (“Father”)
(collectively, “Parents”) are the parents of K.R.L.F., born in 2002, N.F., born
in 2014, Kev.F., born in 2015, and twins Ke.F. and Kr.F., born in 2017
(collectively, “Children”).2
[3] On May 3, 2017, the Department of Child Services (DCS) received a report
alleging that Ke.F. and Kr.F.’s meconium had tested positive for THC at birth.
The next day, DCS interviewed Parents at their house. Mother was tested for
drugs, and the results were later returned as positive for THC. DCS also saw
that Parents’ house was cluttered and dirty. DCS opened an Informal
Adjustment (IA) to provide the family services, and Children remained with
1
Because Mother does not challenge the trial court’s findings of fact, we accept them as true. See Maldem v.
Arko, 592 N.E.2d 686, 687 (Ind. 1992).
2
Father’s parental rights were also terminated, but he does not participate in this appeal; therefore, we limit
our narrative to the facts relevant to Mother.
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 2 of 13
Parents. Parents were provided a home-based case worker to help them clean
and repair their house, but its conditions continued to deteriorate. There were
“animal feces smashed into the carpet throughout the home.” Tr. p. 31.
Family Case Manager (FCM) Supervisor Amanda Holt said that the “dogs had
free reign of the home and left feces all over the place” and that the family’s
“sleeping arrangements were difficult to view because they were just wherever
the piles were not.” Id. During the IA, Mother continued to test positive for
THC.
[4] In October 2017, DCS filed petitions alleging Children to be Children in Need
of Services (CHINS), claiming that Parents were not in compliance with drug
screens and that the conditions of the family’s house had worsened. Later that
day, the trial court held an initial hearing and allowed Children to remain with
Parents under an “in-home” CHINS.
[5] In December 2017, Mother twice tested positive for methamphetamine,
amphetamine, and THC. By the end of December, Children were removed
from Parents’ care due to “poor home conditions,” “ongoing concerns for drug
use,” and a “lack of progress through the in-home CHINS.” Id. at 32. A
detention hearing was held on January 3, 2018, and the trial court approved the
removal of Children from Parents’ care. The next day, one of Mother’s drug
screens was returned as positive for methamphetamine, amphetamine, and
THC. See Ex. H. On January 9, the trial court held a CHINS fact-finding
hearing, and Mother admitted that Children were CHINS. Later that month,
following a dispositional hearing, the trial court ordered Parents to participate
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 3 of 13
in services, including drug and alcohol treatment, random drug screens, home-
based case management, and supervised visitation. See Tr. p. 38. The trial
court also ordered Mother to obtain and maintain stable and appropriate
housing and employment; not use, consume, or possess illegal substances;
complete a family-preservation program; complete parenting and substance-
abuse assessments; and follow all recommendations that came from such
assessments. See Ex. C.
[6] For the next year, Mother was somewhat compliant with services. She
attended almost all supervised visitation with Children, but she “cusse[d] at the
children throughout the visits” and refused contact with Children on weekends
because she claimed that the weekend was “Mother and Father’s time
together.” Ex. C. She also completed her substance-abuse assessment and was
referred to individual therapy, motivational interviewing, and the matrix
program. Mother completed her psychological evaluation and was diagnosed
with bipolar disorder, cannabis-use disorder, and an unspecified anxiety
disorder. It was recommended that before engaging in therapy to address her
bipolar disorder, Mother work on reducing her chronic use of marijuana. See
Tr. p. 132. Regarding the family’s house, Mother refused to engage in home-
based case management, and the house continued to deteriorate. For example,
DCS received a report that there were “dead rats in the kitchen sink with live
rats eating the dead rats.” Id. at 46. DCS was also concerned that there was
possibly mold in the house, there were “[d]og feces throughout the home due to
an estimated twelve dogs in the home,” and the house did not have working
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 4 of 13
utilities. Id. At some point, Parents moved to a house in Clinton, but they
struggled to keep the new house safe and clean and, eventually, refused to allow
DCS inside the home. See Ex. C. As for her participation in random drug
screens, in October 2018, Mother submitted to eleven out of twenty-one
requested drug screens. See id. Nine of those eleven drug screens were positive
for THC. See id.
[7] In January 2019, the trial court suspended Mother’s visits until she attended
one self-help session per week, complied with drug screens, and attended all
sessions for motivational interviewing (a therapy that helps individuals
recognize their problems and build motivation to find solutions) and related
drug and alcohol assistance programs. See id. In February 2019, Mother was
arrested for stabbing her brother.3 See Tr. p. 65. Two weeks later, Mother and
Father got into an altercation. Father was suicidal at the time, and police were
called to Parents’ house. See id. at 65-66. In March, citing Mother’s lack of
progress and noncompliance with services, the trial court approved DCS’s
request to change Children’s permanency plan to termination of parental rights
and adoption.
[8] In April, DCS filed petitions to terminate Mother’s parental rights to Children.
Later that month, DCS went to Parents’ house along with a new home-based
case manager to try to get Mother reengaged in services. However, Mother was
3
According to DCS, no charges were filed for this incident. See Tr. p. 78.
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 5 of 13
“extremely aggressive . . . to the point that [the DCS worker] and the [home-
based] case manager ultimately just got back in [their] car and left.” Id. at 66.
In May, Mother submitted to only three out of the twenty drug screens
requested by DCS. Of those three, one was later returned as positive for
methamphetamine, amphetamine, and THC. See Ex. C. On June 17, Mother
was charged with Class A misdemeanor domestic battery against Father. See
83C01-1906-CM-110. Allegedly, Father was trying to leave the house when
Mother pulled his beard and hair and threw glass at him, cutting his hand. See
Ex. E. Both Mother and Father were arrested and ordered to have no contact
with each other.4 See id.
[9] Less than two weeks later, the termination fact-finding hearing was held.
Father did not appear, and although Mother did appear, she was almost two
hours late to the hearing. See Appellant’s App. Vol. II p. 92. FCM Tamyra
Robinson testified that she had been the family’s case manager since October
2018. FCM Robinson said that Mother told her that she could not engage in
home-based case management because she was “too tired to engage in the
service because of her visitations with [Children].” Tr. p. 45. FCM Robinson
stated that she did not believe that Mother had “any kind of meaningful
relationship with [Children].” Id. at 73. FCM Robinson testified that DCS’s
plan for Children is adoption and that all five children were in pre-adoptive
4
In September 2019, Mother and the State entered into a pretrial diversion agreement.
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 6 of 13
foster homes. Id. at 74. FCM Robinson also stated that she did not believe that
the conditions that caused the removal of Children would ever be remedied. Id.
at 82. Regarding the allegations of domestic violence, FCM Robinson said that
in November 2018, Mother told her that Father “had attempted to kill her three
times, one with an ax, one with a BB gun and one with a machete.” Id. at 61.
[10] Sarah Szerlong, a psychologist, testified that she conducted Mother’s
psychological evaluation and determined that Mother was suffering from
bipolar disorder, cannabis-use disorder, and an unspecified anxiety disorder. Id.
at 131. However, Szerlong said that Mother was “cognitively able to make
positive choices for herself and her children” and that there was no reason to
believe that Mother was not able to improve her parenting skills. Id. at 134.
Donna Coy, a toxicologist with Forensic Fluids, testified that her lab processed
forty drug screens for Mother and of those forty, twenty-four were positive for a
variety of substances, including methamphetamine, THC, buprenorphine, and
hydrocodone. Id. at 21. John Martin, a toxicologist with Redwood
Toxicology, testified that his lab processed five drug screens for Mother and of
those five, three were positive for THC. Id. at 107. Gretchen Peterson testified
that she supervised visits for Mother and Children and that she was never able
to resolve Mother’s issue of “cuss[ing]” at Children during visits. Id. at 154-55.
Jennifer Roach, a mental-health counselor, testified that she provided therapy
to K.R.L.F., N.F., and Kev.F., who were all diagnosed with an “other specified
trauma and stress related disorder.” Id. at 114. Regarding Parents’ house,
Counselor Roach said that K.R.L.F. “has talked about there being animal feces
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 7 of 13
on the floor, animals dying, feeling hungry for food and having to crawl on
countertops and in cabinets to find something to eat.” Id. at 118. Counselor
Roach said that K.R.L.F., N.F., and Kev.F. “need to remain outside of the
home” because “they could suffer mental health related setbacks if they’re
placed in [Parents’ home].” Id. at 119-20.
[11] Court Appointed Special Advocate (CASA) Director Audrey Hayman testified
that she was appointed as Children’s CASA in October 2017. CASA Hayman
stated that she believes termination is in Children’s best interests and that the
conditions resulting in Children’s removal had not been remedied. See id. at
144. CASA Hayman stated that she did not observe any changes in Mother’s
behavior throughout this case. See id. at 147. Mother testified that she recently
“went to jail on domestic battery because [her] husband was beating . . . the
crap out of [her] and [she] called the police.” Id. at 91. Mother said that she
planned on divorcing Father but had not yet filed. Id. Mother asserted that
Father “tried sabotaging everything. He done everything in his power to make
sure [she] lost [Children] and [she] wouldn’t get them back.” Id. at 174.
Mother claimed that she could “do it with [Father] gone.” Id. However,
Mother also admitted that she was addicted to marijuana and not compliant
with services. See id. at 95, 176. In August 2019, the trial court issued its order
terminating Mother’s parental rights.
[12] Mother now appeals.
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 8 of 13
Discussion and Decision
[13] When reviewing the termination of parental rights, we do not reweigh the
evidence or judge witness credibility. In re K.T.K., 989 N.E.2d 1225, 1229 (Ind.
2013). Rather, we consider only the evidence and reasonable inferences that
are most favorable to the judgment of the trial court. Id. When a trial court has
entered findings of fact and conclusions of law, we will not set aside the trial
court’s findings or judgment unless clearly erroneous. Id. To determine
whether a judgment terminating parental rights is clearly erroneous, we review
whether the evidence supports the trial court’s findings and whether the
findings support the judgment. In re V.A., 51 N.E.3d 1140, 1143 (Ind. 2016).
[14] A petition to terminate parental rights must allege, among other things:
(B) that one (1) of the following is true:
(i) There is a reasonable probability that the conditions
that resulted in the child’s removal or the reasons for
placement outside the home of the parents will not be
remedied.
(ii) There is a reasonable probability that the continuation
of the parent-child relationship poses a threat to the well-
being of the child.
(iii) The child has, on two (2) separate occasions, been
adjudicated a child in need of services;
(C) that termination is in the best interests of the child; and
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 9 of 13
(D) that there is a satisfactory plan for the care and treatment of
the child.
Ind. Code § 31-35-2-4(b)(2). DCS must prove the alleged circumstances by
clear and convincing evidence. In re K.T.K., 989 N.E.2d at 1231. If the court
finds that the allegations in a petition are true, the court shall terminate the
parent-child relationship. Ind. Code § 31-35-2-8(a).
[15] Mother first challenges the trial court’s conclusion that there is a reasonable
probability that the conditions resulting in Children’s removal will not be
remedied. In determining whether the conditions that resulted in a child’s
removal will not be remedied, the trial court engages in a two-step analysis.
First, the trial court must ascertain what conditions led to the child’s placement
and retention in foster care. In re K.T.K., 989 N.E.2d at 1231. Second, the trial
court determines whether there is a reasonable probability that those conditions
will not be remedied. Id. “The trial court must consider a parent’s habitual
pattern of conduct to determine whether there is a substantial probability of
future neglect or deprivation.” Id. The trial court has discretion to weigh a
parent’s prior history more heavily than efforts made only shortly before
termination, and the court may find that a parent’s past behavior is the best
predictor of her future behavior. In re A.W., 62 N.E.3d 1267, 1273 (Ind. Ct.
App. 2016).
[16] Mother specifically argues that “she was the victim” of domestic violence and
“had left Father and would be filing for divorce,” and therefore that she can
now remedy the conditions that resulted in Children’s removal. Appellant’s Br.
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 10 of 13
p. 18. First, by no means is it clear from the record that Mother was the victim
of domestic violence. There is evidence showing that Father and Mother were
both arrested in June 2019 for battering each other and that during the incident,
Mother threw glass at Father and cut his hand. See Ex. E. But even if we
assume that Mother was the victim of domestic violence and that she followed
through on her plan to divorce Father, there is plenty of other evidence showing
that she is no closer to providing Children a safe, stable home than she was at
the beginning of the CHINS case in October 2017. The evidence shows that
Mother did not participate in cleaning the home and did not provide for
Children’s needs. Therefore, the trial court found that Parents “failed to
demonstrate that they could clean their residence to ensure the safety of the
Children.” Appellant’s App. Vol. II p. 110. Mother herself admitted that she
did not comply with services. Tr. p. 176. Furthermore, the evidence shows that
Mother used THC and methamphetamine a month before the termination
hearing and that she consistently tested positive for THC throughout the
CHINS case. The trial court found that “Mother continued abusing THC on a
regular basis.” Appellant’s App. Vol. II p. 113. Indeed, Mother even admitted
that she is addicted to marijuana. See Tr. p. 95. Accordingly, the trial court did
not err when it concluded that there is a reasonable probability that the
conditions resulting in Children’s removal and continued placement outside the
home will not be remedied.
[17] Mother also challenges the trial court’s conclusion that termination is in
Children’s best interests. To determine what is in the child’s best interests, the
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 11 of 13
trial court must look to the totality of the evidence. In re A.D.S., 987 N.E.2d
1150, 1158 (Ind. Ct. App. 2013), trans. denied. In doing so, the trial court must
subordinate the interests of the parents to those of the child. Id. The trial court
need not wait until the child is irreversibly harmed before terminating the
parent-child relationship. Id. Moreover, we have previously held that the
recommendation by both the case manager and child advocate to terminate
parental rights, in addition to evidence that the conditions resulting in removal
will not be remedied, is sufficient to show by clear and convincing evidence that
termination is in the child’s best interests. Id. at 1158-59.
[18] Here, FCM Robinson and CASA Hayman both testified that terminating
Mother’s parental rights is in Children’s best interests. See Tr. pp. 74, 144. The
trial court also found that Mother “demonstrated repeatedly that [she] did not
have a significant or meaningful relationship with the Children.” Appellant’s
App. Vol. II p. 115. The evidence shows that Mother “cusse[d] at the children
throughout the visits” and refused contact with Children on the weekends
because she claimed that the weekend was “Mother and Father’s time
together.” See Ex. C. Furthermore, Counselor Roach testified that the children
she worked with—K.R.L.F., N.F., and Kev.F.—needed to remain outside
Parents’ home to ensure that their mental-health needs were met. Tr. p. 119.
Indeed, Counselor Roach said that K.R.L.F. told her that when she lived with
Mother, she remembered “feeling hungry for food and having to crawl on
countertops and in cabinets to find something to eat.” Id. at 118. For all of
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 12 of 13
these reasons, the trial court did not err when it found that termination is in
Children’s best interests.
[19] Affirmed.
May, J., and Robb, J., concur.
Court of Appeals of Indiana | Memorandum Decision 19A-JT-2165 | April 8, 2020 Page 13 of 13 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523659/ | MEMORANDUM DECISION
Pursuant to Ind. Appellate Rule 65(D), FILED
this Memorandum Decision shall not be Apr 08 2020, 11:18 am
regarded as precedent or cited before any
CLERK
court except for the purpose of establishing Indiana Supreme Court
Court of Appeals
the defense of res judicata, collateral and Tax Court
estoppel, or the law of the case.
ATTORNEY FOR APPELLANT ATTORNEYS FOR APPELLEE
Michael G. Moore Curtis T. Hill, Jr.
Indianapolis, Indiana Attorney General of Indiana
Myriam Serrano
Deputy Attorney General
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
K.B., April 8, 2020
Appellant-Respondent, Court of Appeals Case No.
19A-JV-2135
v. Appeal from the Knox Superior
Court, Juvenile Division
State of Indiana, The Honorable Gara U. Lee,
Appellee-Petitioner. Judge
Trial Court Cause No.
42D01-1902-JD-11
Pyle, Judge.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 1 of 12
Statement of the Case
[1] K.B. (“K.B.”)—following his admission to the allegation that he had
committed an act that would constitute Class B misdemeanor criminal mischief
if committed by an adult and his subsequent unsuccessful placement in a
residential program—appeals the juvenile court’s modified disposition order
awarding wardship to the Indiana Department of Correction with placement at
a juvenile facility. He also argues that the juvenile court erred by ordering
payment of costs and fees without inquiring into the ability to pay. Concluding
that the juvenile court did not abuse its discretion by modifying the
dispositional order and that the juvenile court improperly imposed costs and
fees without inquiring into an ability to pay, we affirm the juvenile court’s
modified disposition order, reverse the juvenile court’s imposition of costs and
fees, and remand for further proceedings.
[2] We affirm in part, reverse in part, and remand.
Issues
1. Whether the juvenile court abused its discretion by modifying
the dispositional order to award wardship of K.B. to the
Department of Correction.
2. Whether the juvenile court erred by ordering payment of costs
and fees without inquiring into the ability to pay.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 2 of 12
Facts
[3] In February 2019, then fifteen-year-old K.B. lived with his stepmother, Sara
Letts (“Stepmother”),1 while his father was incarcerated. K.B.’s mother did not
have regular contact with K.B. Apparently another relative had had a
guardianship over K.B. since 2014, but that guardian did not have contact with
K.B.
[4] On February 24, 2019, K.B. damaged a door frame at Stepmother’s house.
Thereafter, the State filed a petition alleging that K.B. was a delinquent child
for committing an act that would constitute Class B misdemeanor criminal
mischief if committed by an adult. K.B.’s juvenile history included an
adjudication in September 2018 for battery resulting in moderate bodily injury
and referrals for disorderly conduct and habitual disobedience.
[5] On March 14, 2019, the juvenile court held a combination
admission/disposition hearing, during which K.B. admitted to the delinquency
allegation. Stepmother was present at the hearing.2 The juvenile court
determined that K.B. was a delinquent child and then moved to determining the
disposition. The juvenile court ordered a “90-day suspended sentence to secure
detention, suspended to one year of formal probation[.]” (Tr. Vol. 2 at 10). As
1
The record on appeal refers to Stepmother as Sara Letts, Sarah Letts, Sara Lett, or Sara Baughn.
2
The record on appeal indicates that K.B.’s “sister” was present at the hearing. (App. Vol. 2 at 8, 53).
However, the record further indicates that this “sister” who was present was Sara Letts, who is K.B.’s
stepmother.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 3 of 12
a condition of probation, the juvenile court ordered K.B. to complete a
residential treatment program at White’s Residential and Family Services
(“White’s”). During that hearing, the juvenile court advised K.B. as follows:
[W]hen you’re at White’s, how long you are there is going to be
dependent on you and your progress in that program[.] . . . So
the sooner you get on board and take things seriously and take
things to heart, and make some real change, the sooner you’re
going to be able to come home.
(Tr. Vol. 2 at 11). Additionally, the juvenile court imposed the “typical fines,
costs, and fees[,]” which included a court cost of $185, a probation
administration fee of $100, a public defender fee of $50, initial probation fee of
$25, and a monthly user fee of $15. Upon the imposition of these costs and
fees, K.B.’s counsel, the probation officer, and the juvenile court had the
following discussion:
[K.B.’s Counsel]: Just one administrative question, Your Honor.
With regard to the fees, this is the situation where we have the
guardianship in place for [K.B.] with a guardian that doesn’t
have any contact with [K.B.], Dad’s incarcerated, and Mom’s
not involved on a regular basis. Who would normally be
responsible for the payment of those fees to your office?
[Probation Officer]: It would be [K.B.].
[K.B.’s Counsel]: And he’s 15, and going to placement, so I
assume that will be something we will work out. Okay.
THE COURT: Yup.
[Probation Officer]: And that the monthly fee part?
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 4 of 12
THE COURT: While he’s in placement - -
[Probation Officer]: Is waived?
THE COURT: - - won’t accrue.
[K.B.’s Counsel]: Okay. Okay.
(Tr. Vol. 2 at 11-12).
[6] On June 3, 2019, the juvenile court held a review hearing. K.B.’s probation
officer submitted a report prior to the hearing, and K.B.’s case manager at
White’s, Miranda Sipe (“Case Manager Sipe”), testified during the hearing.
Case Manager Sipe informed the juvenile court that K.B. had initially done well
when he had arrived at White’s and that he was doing well academically.
However, at the end of April and beginning of May, K.B. had been having
behavioral issues, including anger issues, trying to manipulate staff, and
problems with accepting consequences. The case manager also explained that
K.B. was participating in, but had not yet completed, various treatment
programs and that he was working on some family therapy with Stepmother.
Before setting another review hearing for October, the juvenile court
emphasized the importance of K.B.’s treatment participation at White’s:
So [K.B.], you understand that, you know, how long you’re in
treatment depends on you and your progress there. . . . [W]e
want to make sure that you benefit from this program, and that
when you’re released, you’re in a position that you won’t be
coming back here to see me again. We want you to be
successful, sounds like you’re doing great in school, I’m going to
encourage you to keep up that, but really, you know, focus on
your treatment and that type of thing because everybody wants
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 5 of 12
you to be successful and we’re trying to get you in the best
position for that.
(Tr. Vol. 2 at 18).
[7] K.B., however, did not heed the juvenile court’s advice when he returned to
White’s. Beginning the day after the review hearing through the end of July,
K.B. engaged in a host of aggressive and inappropriate behaviors that led
White’s to request for K.B.’s immediate removal from its program on July 30.
These behaviors included repeated verbal aggression, physically assaulting staff
members and other children at the facility, destruction of facility property,
watching pornography and showing pornography to other children, and
possessing a vape pen and a shank made from a toothbrush.
[8] On July 31, 2019, the State filed a modification report, setting forth all of K.B.’s
behavioral issues while at White’s and requesting that his disposition be
modified. On August 1, 2019, K.B. was removed from White’s and placed in
Southwestern Indiana Regional Youth Village (“Youth Village”) until an
August 14 modification hearing. During the short period that K.B. was at the
Youth Village, he continued to display aggressive behavior. For example, he
engaged in defiant behavior, intimidation, and destruction of property, such as
“flipping the dayroom” and throwing a chair at a television. (Tr. Vol. 2 at 36).
[9] On August 14, 2019, the juvenile court held a modification hearing. K.B.’s
mother was present at the hearing. K.B.’s mother informed the juvenile court
that she had been awarded custody of K.B. when she divorced his father but
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 6 of 12
that an aunt currently had a guardianship over K.B. At the end of the hearing,
the juvenile court modified the disposition order and awarded wardship of K.B.
to the Department of Correction with placement at the juvenile facility. The
juvenile court did not modify its order for the payment of costs or fees. K.B.
now appeals.
Decision
1. Modified Disposition
[10] K.B. first argues that the juvenile court abused its discretion by modifying his
disposition. Specifically, he contends that the juvenile court should have
continued his placement at White’s or should have considered another less
restrictive placement instead of ordering his placement with the Department of
Correction. We disagree.
[11] The choice of the specific disposition of a juvenile adjudicated a delinquent
child is a matter within the sound discretion of the juvenile court subject to the
statutory considerations of the welfare of the child, the safety of the community,
and the policy of favoring the least harsh disposition. J.S. v. State, 881 N.E.2d
26, 28 (Ind. Ct. App. 2008). A juvenile disposition will not be reversed absent a
showing of an abuse of discretion. Id. An abuse of discretion occurs when the
juvenile court’s action is clearly erroneous and against the logic and effect of the
facts and circumstances before the court or the reasonable, probable, and actual
inferences that can be drawn therefrom. Id. Thus, the juvenile court is
accorded wide latitude and great flexibility in its dealings with juveniles. Id.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 7 of 12
[12] INDIANA CODE § 31-37-18-6 provides:
If consistent with the safety of the community and the best
interest of the child, the juvenile court shall enter a dispositional
decree that:
(1) is:
(A) in the least restrictive (most family like) and most
appropriate setting available; and
(B) close to the parents’ home, consistent with the best
interest and special needs of the child;
(2) least interferes with family autonomy;
(3) is least disruptive of family life;
(4) imposes the least restraint on the freedom of the child and the
child’s parent, guardian, or custodian; and
(5) provides a reasonable opportunity for participation by the
child’s parent, guardian, or custodian.
[13] Under this statute, the juvenile court “is only required to consider the least
restrictive placement if that placement comports with the safety needs of the
community and the child’s best interests.” J.B. v. State, 849 N.E.2d 714, 717
(Ind. Ct. App. 2006) (citing I.C. § 31-37-18-6) (emphasis in original). “Thus,
the statute recognizes that in certain situations the best interest of the child is
better served by a more restrictive placement.” K.A. v. State, 775 N.E.2d 382,
387 (Ind. Ct. App. 2002), trans. denied.
[14] Here, this case presents such a situation where a more restrictive placement was
not an abuse of discretion. K.B., who has a history of juvenile delinquency,
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 8 of 12
was already given an opportunity to be in a less restrictive residential placement
at White’s, and he was unsuccessful in that placement. Indeed, his behavior
while in that residential placement was so frequent and abhorrent that White’s
sought to have him immediately removed its facility. Moreover, after K.B.’s
removal from White’s, he continued his aggressive behavior while in the Youth
Village. K.B.’s behavior showed a defiance and lack of respect for authority.
Given the facts and circumstances of this case, we cannot say that the juvenile
court abused its discretion by modifying its disposition order and ordering the
placement of K.B. with the Department of Correction. See, e.g., K.A., 775
N.E.2d at 387 (concluding that there was no abuse of discretion by the juvenile
court when it modified the juvenile’s disposition to commitment to the
Department of Correction after the juvenile had failed to reform her behavior at
other placements); M.R. v. State, 605 N.E.2d 204, 208 (Ind. Ct. App. 1992)
(explaining that “[t]here are times in juvenile proceedings when the best interest
of the juvenile and society require commitment” to a juvenile facility).
2. Payment of Costs and Fees
[15] Additionally, K.B. challenges the juvenile court’s imposition of costs and fees
without inquiring into his or his parents’ ability to pay.
[16] Pursuant to INDIANA CODE § 31-40-2-1(a), a juvenile court “may” order a
delinquent child or the child’s parent, guardian, or custodian to pay probation
fees and an administrative fee; however, such fees are subject to INDIANA CODE
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 9 of 12
§ 31-40-1-3.3 Our Court recently addressed INDIANA CODE § 31-40-1-3,
sometimes referred to as the reimbursement statute, as follows:
The reimbursement statute provides that the juvenile court
“shall” order parents to pay for or reimburse the costs of services
provided to the delinquent child “unless” the court finds that
parents are unable to pay or that justice would not be served.
I.C. § 31-40-1-3(c). Thus, implicit in an order for parents to
reimburse costs is that parents are able to pay and that such is in
the interest of justice. Hence, this court has held that the
reimbursement statute requires the juvenile court to inquire into
parents’ ability to pay and what justice requires for any given set
of circumstances before it can order parents to pay or reimburse
costs.
3
INDIANA CODE § 31-40-1-3 provides, in relevant part:
(a) A parent or guardian of the estate of:
(1) a child adjudicated a delinquent child . . .
is financially responsible . . . for any services provided by or through the department.
(b) Each person described in subsection (a) shall, before a hearing under subsection (c)
concerning payment or reimbursement of costs, furnish the court and the department with an
accurately completed and current child support obligation worksheet on the same form that is
prescribed by the Indiana supreme court for child support orders.
(c) At:
(1) a detention hearing;
(2) a hearing that is held after the payment of costs by the department under section 2 of this
chapter (or IC 31-6-4-18(b) before its repeal);
(3) the dispositional hearing; or
(4) any other hearing to consider modification of a dispositional decree;
the juvenile court shall order the child’s parents or the guardian of the child’s estate to pay for,
or reimburse the department for the cost of services provided to the child or the parent or
guardian unless the court makes a specific finding that the parent or guardian is unable to pay or
that justice would not be served by ordering payment from the parent or guardian.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 10 of 12
E.M. v. State, 128 N.E.3d 1, 7 (Ind. Ct. App. 2019) (citing of Matter of C.K., 695
N.E.2d 601, 605 (Ind. Ct. App. 1998), trans. denied; In re M.L.K., 751 N.E.2d
293, 298-99 (Ind. Ct. App. 2001)).
[17] Here, the juvenile court imposed costs and fees at the initial disposition hearing
when K.B.’s parents or guardian were not present. K.B.’s stepmother was at
that hearing, but the record before us does not reveal that the juvenile court
made any inquiry to K.B. or Stepmother regarding an ability to pay.
Additionally, at the disposition modification hearing, K.B.’s mother was
present, but the juvenile court made no inquiry into her ability to pay.
[18] The State acknowledges that the juvenile court improperly ordered K.B. to pay
costs and fees without inquiring as to his or his parents’ ability to pay and that
“the appropriate remedy would be to remand to the juvenile court to conduct
an indigency hearing.” (State’s Br. 13).4 Accordingly, we remand this case to
the juvenile court to conduct an indigency hearing. See, e.g., E.M., 128 N.E.3d
at 2 (reversing the imposition of costs and remanding for a hearing to consider
statutory factors, including the parents’ ability to pay and whether
reimbursement served the interest of justice); M.Q.M. v. State, 840 N.E.2d 441,
449 (Ind. Ct. App. 2006) (remanding the case for the juvenile court to conduct
4
We reject the State’s initial argument that K.B. forfeited his right to appeal the imposition of fees and costs
because he did not file a notice of appeal when the juvenile court entered its initial disposition order and
because there are no extraordinary compelling reasons to allow him to raise the issue.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 11 of 12
an indigency hearing); A.E.B. v. State, 756 N.E.2d 536, 544 (Ind. Ct. App. 2001)
(remanding for indigency hearing to determine juvenile’s ability to pay
probation and public defender fees).
[19] Affirmed in part, reversed in part, and remanded.
Bradford, C.J., and Baker, J., concur.
Court of Appeals of Indiana | Memorandum Decision 19A-JV-2135 | April 8, 2020 Page 12 of 12 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523662/ | FILED
Apr 08 2020, 8:07 am
CLERK
Indiana Supreme Court
Court of Appeals
and Tax Court
ATTORNEY FOR APPELLANT ATTORNEYS FOR APPELLEE
Cynthia M. Carter Curtis T. Hill, Jr.
Law Office of Cynthia M. Carter, LLC Attorney General of Indiana
Indianapolis, Indiana
Jesse R. Drum
Caroline G. Templeton
Deputy Attorneys General
Indianapolis, Indiana
IN THE
COURT OF APPEALS OF INDIANA
Harold Warren, April 8, 2020
Appellant-Petitioner, Court of Appeals Case No.
19A-PC-1604
v. Appeal from the Marion Superior
Court
State of Indiana, The Honorable Barbara Crawford,
Appellee-Respondent Judge
The Honorable Steven Rubick,
Magistrate
Trial Court Cause No.
46G01-1708-PC-28299
May, Judge.
[1] Harold Warren appeals the trial court’s order denying his petition for
postconviction relief. He argues his Sixth Amendment right to effective
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 1 of 18
assistance of counsel was infringed because his trial counsel failed to thoroughly
investigate and present evidence implicating alternative suspects. We affirm.
Facts and Procedural History 1
[2] Jack Dorfman operated a small business on Washington Street in Indianapolis,
where he would purchase precious metals and cash checks. On January 7,
1999, a customer visited Dorfman’s shop and found Dorfman lying dead on the
floor from a gunshot wound. Police investigated the murder and subsequently
arrested Harold Warren. On January 14, 1999, the State charged Warren with
murder, 2 felony murder, 3 and Class A felony robbery. 4
[3] Warren filed a petition for writ of habeas corpus and admission to bail. At the
hearing on the petition, Steve Jordan, the owner of a printing store located near
Dorfman’s shop, testified that on the morning of Dorfman’s murder, a black
pickup truck parked in the parking lot of his printing store. The truck remained
running and an individual got out of the pickup truck and walked in the
direction of Dorfman’s shop. 5 The individual had medium-length hair, wore
1
We heard oral argument in this case on February 3, 2020, at the University of Southern Indiana in
Evansville. We commend counsel for their advocacy and thank the University of Southern Indiana’s faculty,
staff, and students for their attendance.
2
Ind. Code § 35-42-1-1 (1997).
3
Ind. Code § 35-42-1-1 (1997).
4
Ind. Code § 35-42-5-1 (1984).
5
Jordan did not testify regarding how many people were in the truck.
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 2 of 18
blue jeans with a leather jacket, and was “maybe five ten, somewhere in that
neighborhood, dark hair, clean shaven, not very heavy, not real slender, just
medium build.” (Ex. AAA at 16.) When asked if the individual Jordan
described matched Warren’s appearance, Jordan answered, “Probably not.”
(Id. at 17.) Dana Roberson also testified at the hearing. She gave an
incomplete report of her criminal history and confirmed that she had dated
Larry Warren (“Larry”), Harold Warren’s brother. She denied seeing Warren
on the day of Dorfman’s murder. After Roberson’s brief background
testimony, the court implored Warren’s counsel, Carl L. Epstein, to “get to the
point” and Epstein ceased his examination. (Ex. BBB at 41.) The court denied
Warren’s petition for bail.
[4] The court held a jury trial from February 7 through February 9, 2000. Epstein
did not subpoena either Larry or Roberson to testify at the trial. The jury
returned a verdict of guilty on all counts, and the court entered judgments of
conviction for murder and Class B felony robbery, 6 which is a lesser-included
offense of the Class A felony robbery charged. The court sentenced Warren to
consecutive terms of sixty-five years for murder and twenty years for robbery,
for an aggregate executed term of eighty-five years in the Indiana Department
of Correction.
6
Ind. Code § 35-42-5-1 (1984).
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 3 of 18
[5] On direct appeal, our Indiana Supreme Court 7 summarized the evidence
presented to the jury during Warren’s trial:
[T]he victim, Jack Dorfman, the proprietor of a small
Indianapolis store that purchased and sold jewelry and precious
metals and cashed checks, was killed by a single .22 caliber
gunshot wound to the head, probably fired from a revolver.
Three days after the murder, Paul Fancher had purchased a .22
caliber revolver from the defendant’s brother, Ron Warren, who
had obtained it from one of his brothers. After learning that the
defendant had been arrested for the murder, Fancher turned the
gun over to police. On the day before the murder, the defendant
had been in Dorfman’s store to sell some rings. After Dorfman
declined and directed that the defendant be escorted out of the
shop, the defendant told him: “I’ll be back.” The defendant
admitted to police that he was in Dorfman’s store on the day of
the murder. After the murder, the defendant’s fingerprints were
discovered on a pawn ticket found on the counter of the shop,
and yet the defendant told police that he never could have left his
thumbprint on a pawn card because he had never pawned
anything. On the day of the murder, the defendant used
Dorfman’s credit cards at a liquor store, a Meijer store, a K-Mart
store, and a Radio Shack store.
Warren v. State, 757 N.E.2d 995, 999 (Ind. 2001). The Supreme Court affirmed
Warren’s convictions. Id. at 1001.
[6] Warren filed a petition for postconviction relief on July 13, 2017. The petition
alleged Warren’s trial counsel, Epstein, provided constitutionally ineffective
7
At the time, the appellate rules allowed for a direct appeal to the Indiana Supreme Court because Warren
was sentenced to a term of greater than fifty years for a single offense. See Ind. Appellate Rule 4(A)(7)
(1999).
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 4 of 18
assistance because he “failed to present crucial defense evidence, failed to hire
or consult expert witnesses, and failed to interview and subpoena key defense
witnesses.” (App. Vol. II at 9-10.) The postconviction court held an
evidentiary hearing, conducted over four non-consecutive days, on Warren’s
petition. Epstein testified at the postconviction hearing. 8 Epstein
acknowledged he was not able to invest as much time into preparing Warren’s
case as he would have liked because he expended a lot of time and resources
preparing and trying a multi-week federal criminal trial, which concluded
shortly before Warren’s trial, and because his medical problems, including Type
2 diabetes and a heart problem, limited the amount of time Epstein could
devote to preparing for Warren’s trial. Epstein testified that if he had had more
time, he would have taken Roberson’s deposition. Epstein did not talk with
Roberson informally or take a taped statement from her before Warren’s trial.
Epstein acknowledged receiving Indianapolis Police Department 9 inter-
department communications about fingerprint evidence in the Dorfman
murder, and he testified that he should have used the evidence in his arguments
at Warren’s trial. 10
8
Epstein’s bar license is currently suspended without automatic reinstatement. (Tr. Vol. II at 15.)
9
Currently, the department is known as the Indianapolis Metropolitan Police Department. However, at the
time of the investigation into the Dorfman murder, the department was known as the Indianapolis Police
Department.
10
During Warren’s examination of Epstein at the post-conviction hearing, Warren marked as an exhibit and
questioned Epstein about Indianapolis Police Department inter-department communications regarding the
fingerprint evidence in the Dorfman murder. These inter-department communications were offered but not
admitted as evidence at the postconviction hearing.
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 5 of 18
[7] Sergeant Michael Knapp of the Indianapolis Metropolitan Police Department
also testified at the postconviction evidentiary hearing. Sergeant Knapp
analyzed the latent fingerprint evidence officers collected in connection with the
Dorfman murder. Sergeant Knapp received a pawn ticket with an inked
fingerprint on it and latent fingerprints from the scene of the murder. Sergeant
Knapp determined that Aaron Gill’s fingerprints matched latent fingerprints
recovered from the murder scene. A crime scene technician recovered those
latent fingerprints from the side of a clear cellophane bag found in the
backroom of Dorfman’s shop. Sergeant Knapp compared the other latent prints
to Warren’s fingerprints, and he determined the latent prints did not belong to
Warren. However, Sergeant Knapp determined the inked print on the pawn
ticket did belong to Warren.
[8] Larry testified at the postconviction relief hearing that he and Roberson were
dating and living together at the time of Dorfman’s murder. On the morning of
Dorfman’s murder, Larry awoke about 8:30 am and found Roberson was not
home. Roberson returned to their residence at approximately 12:30 pm. Larry
testified that Roberson had multiple conversations with law enforcement in the
days after the Dorfman murder. Police officers came to their home and
questioned them about three days after Dorfman’s murder, and a detective left
with Roberson. Larry testified that in the days following Dorfman’s murder,
Roberson appeared “very anxious.” (Tr. Vol. II at 79.) He also testified she
suddenly had a lot of money. Roberson used cash to purchase a recreational
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 6 of 18
vehicle, had her black pickup truck painted grey, and took herself and Larry to
Florida.
[9] Warren subpoenaed Roberson to appear at the evidentiary hearing. However,
Roberson did not appear at the first two days of the evidentiary hearing.
Roberson testified on the third day, but her testimony was suspended so she
could consult with an attorney. During her brief testimony, Roberson
confirmed that she spoke with Detective Alan Jones of the Indianapolis Police
Department about Warren. She also confirmed that she did not speak with
Epstein before Warren’s trial, other than when she testified in connection with
Warren’s petition for bail. Roberson was called to testify on the fourth day of
the postconviction evidentiary hearing, after the court appointed her counsel,
but on the advice of counsel, she invoked her right against self-incrimination
under the Fifth Amendment to the United States Constitution and did not
provide further testimony. Warren also testified at the post-conviction hearing
that he believed Epstein should have done more to investigate his case. He
stated that he wanted Epstein to talk to Roberson and Larry in preparing his
defense.
[10] On June 12, 2019, the postconviction court issued an order with findings of fact
and conclusions of law denying Warren’s petition. The postconviction court
concluded:
Here [Warren] has raised the barest inference of Ms. Roberson
being associated with this crime and, more importantly in this
context, [Warren] has pointed to no material evidence which
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 7 of 18
directly connects Ms. Roberson to the crime or the crime scene.
Without substantially more evidence, this Court cannot draw any
rational inference connecting the murder and the alleged
repainting of the truck, or connecting Dana Roberson’s
possession of an indeterminate amount of money at an
indeterminate point in time. Lacking this, this Court does not
find that trial counsel was ineffective for failing to subpoena
Dana Roberson at trial or in failing to further develop her as an
alternate suspect.
(Appellant’s App. Vol. II at 121.) Additionally, the postconviction court
concluded Epstein was not ineffective for failing to present Aaron Gill as an
alternate suspect because, other than Gill’s fingerprints being present at the
crime scene, there was no other material evidence connecting Gill to Dorfman’s
murder. The postconviction court also pointed out that Epstein raised the
specter of an alternative suspect, though not Roberson or Gill, when cross-
examining Detective Jones during Warren’s criminal trial.
Discussion and Decision
[11] The petitioner for postconviction relief must establish that he is entitled to relief
by a preponderance of the evidence. Timberlake v. State, 753 N.E.2d 591, 597
(Ind. 2001), reh’g denied, cert. denied 537 U.S. 839 (2002). “Because he is now
appealing a negative judgment, to the extent his appeal turns on factual issues,
[the petitioner] must convince this Court that the evidence as a whole leads
unerringly and unmistakably to a decision opposite that reached by the
postconviction court.” Id. “Where the [postconviction] court has entered
findings of fact and conclusions of law, we accept the findings of fact unless
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 8 of 18
clearly erroneous, but accord no deference [to] conclusions of law.” Turner v.
State, 974 N.E.2d 575, 581 (Ind. Ct. App. 2012), trans. denied. We will reverse
the postconviction court’s decision only if the evidence is without conflict and
leads to a conclusion opposite that reached by the postconviction court. Id. at
581-82.
Ineffective Assistance of Counsel
[12] If not raised on direct appeal, a criminal defendant may raise a claim of
ineffective assistance of counsel in a postconviction relief petition. Timberlake,
753 N.E.2d at 597. The Sixth Amendment to the United States Constitution
provides that in all criminal prosecutions, a defendant is entitled “to have the
assistance of counsel for his defense.” U.S. Const., Am. VI. This requires
counsel’s assistance be effective. Strickland v. Washington, 466 U.S. 668, 686
(1984), reh’g denied. There is a strong presumption that trial counsel provided
effective representation, and a petitioner must put forth strong evidence to rebut
that presumption. McCullough v. State, 973 N.E.2d 62, 74 (Ind. Ct. App. 2012),
trans. denied. “Isolated poor strategy, inexperience, or bad tactics does not
necessarily constitute ineffective assistance of counsel.” Id. Rather, a petitioner
must show that trial counsel’s performance was deficient, and the petitioner
was prejudiced by the deficiency. Id. at 75.
When evaluating a defendant’s ineffective-assistance-of-counsel
claim, we apply the well-established, two-part Strickland test. The
defendant must prove: (1) counsel rendered deficient
performance, meaning counsel’s representation fell below an
objective standard of reasonableness as gauged by prevailing
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 9 of 18
professional norms; and (2) counsel’s deficient performance
prejudiced the defendant, i.e., but for counsel’s errors the result
of the proceeding would have been different.
Bobadilla v. State, 117 N.E.3d 1272, 1280 (Ind. 2019) (internal citation omitted).
1. Counsel’s Performance
A. Investigation of Roberson as Alternative Suspect
[13] Warren argues his trial counsel, Epstein, was ineffective because Epstein did
not thoroughly investigate Roberson as an alternative suspect. An attorney
“has a duty to make a reasonable investigation or to make a reasonable decision
that the particular investigation is unnecessary.” Ritchie v. State, 875 N.E.2d
706, 719-720 (Ind. 2007). We give considerable deference to trial counsel’s
strategic and tactical decisions, but “in order to make a reasonable tactical
decision, counsel must have adequately investigated the client’s case because
‘strategic choices made after less than complete investigation are reasonable
precisely to the extent that reasonable professional judgments support the
limitations on investigation.’” Conner v. State, 711 N.E.2d 1238, 1248 (Ind.
1999) (quoting Strickland, 466 U.S. at 690-91), cert. denied 531 U.S. 829 (2000).
[14] Warren argues Epstein was delinquent in not pursuing discovery in order to
obtain evidence of Roberson’s bad character and should have further
investigated the theory that Roberson murdered Dorfman. Even though
Epstein moved to compel the State to disclose Roberson’s criminal history and
related information, Epstein filed a motion in limine seeking to exclude
Roberson’s testimony before receiving the requested discovery. The requested
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 10 of 18
discovery would have shown that Roberson was charged with Class D felony
theft 11 in 1992 and had two misdemeanor theft convictions. The police spoke
with Roberson after Dorfman’s murder, and Warren contends that he was
arrested as a result of information Roberson gave the police.
[15] Warren contends Epstein provided deficient performance by not investigating
Roberson more thoroughly and by failing to subpoena her. Epstein thought the
individual described by Jordan in his testimony at the bail hearing could have
been Roberson because she owned a black pickup truck and had the same build
as a small man. Epstein testified that “[p]erhaps [he] hadn’t done a good
enough job in terms of investigating Ms. Roberson.” (Tr. Vol. II at 25.)
Epstein also admitted at the postconviction hearing that he “kn[e]w or ha[d]
reason to believe” Roberson was a “fence.” 12 (Id. at 43.)
[16] Additionally, Warren argues Epstein should have interviewed Larry or
subpoenaed him to be a witness. Larry testified at the postconviction relief
hearing that he lived with Roberson at the time of Dorfman’s murder, that
Roberson’s whereabouts at the time of the murder were unknown, that she had
her truck painted shortly after the murder, that she came into a large amount of
cash after the murder, and that they left for Florida after the murder. Larry also
11
Ind. Code § 35-43-4-2 (1986).
12
“Fence” is a colloquial term used to refer to “a receiver of stolen goods.” Fence, Merriam-Webster
https://www.merriam-webster.com/dictionary/fence [https://perma.cc/EMS4-BXNP].
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 11 of 18
testified at the postconviction relief hearing that he believed Roberson had
multiple conversations with law enforcement concerning the Dorfman murder
and that she was trying to deflect blame from herself to Warren. Therefore,
Warren argues Epstein was ineffective because he did not adequately question
Larry in order to find out what Larry knew about the circumstances
surrounding the crime.
[17] The State maintains that Epstein was not ineffective because the evidence
pointing to Roberson as an alternative suspect was inadmissible. As our Indiana
Supreme Court has explained:
Evidence of a third-party motive tends [to make] it less probable
that the defendant committed the crime, and is therefore relevant
under Rule of Evidence 401. Joyner v. State, 678 N.E.2d 386, 389
(Ind. 1997). However, this evidence may be excluded if its
probative value is out-weighed by unfair prejudice, confusion of
the issues, or the potential to mislead the jury. Ind. Evid. R. 403.
In the context of third-party motive evidence, these rules are
grounded in the widely-accepted principle that before evidence of
a third party is admissible, the defendant must show some
connection between the third party and the crime. See Holmes v.
South Carolina, 547 U.S. 319, 327 & n. *, 126 S. Ct. 1727, 164
L. Ed. 2d 503 (2006) (listing jurisdictions and quoting 41 C.J.S.,
Homicide § 216, at 56-58 (1991) (“Evidence tending to show the
commission by another person of the crime charged may be
introduced by accused when it is inconsistent with, and raises a
reasonable doubt of, his own guilt; but frequently matters offered
in evidence for this purpose are so remote and lack such
connection with the crime that they are excluded.”)).
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 12 of 18
Pelley v. State, 901 N.E.2d 494, 505 (Ind. 2009), reh’g denied; see also Lashbrook v.
State, 762 N.E.2d 756, 758 (Ind. 2002) (holding trial court did not abuse
discretion in excluding evidence that a third party made threatening comments
because there was no material evidence connecting the third party to the crime).
The State argues the evidence concerning Roberson presented at the
postconviction hearing would not have been admitted at Warren’s trial because
the evidence is speculative and does not directly connect Roberson to the crime.
[18] However, while the evidence does not directly link Roberson to the crime, it
raises several red flags. Had Epstein interviewed Larry, he would have
discovered substantial information that casts suspicion on Roberson. Epstein
then could have deposed, interviewed, or subpoenaed Roberson. He could
have asked her where she was the morning of the murder, how many
conversations she had with law enforcement about the murder, how she was
able to purchase the recreational vehicle, why she decided to take a trip to
Florida with Larry shortly after the murder, whether she repainted her truck
grey, and if so, why she repainted her truck. Roberson might have invoked her
Fifth Amendment right against self-incrimination, denied Larry’s allegations, or
provided innocent explanations, but Epstein did not find out. Therefore, we
agree with Warren that Epstein’s performance was deficient regarding his
investigation of Roberson. See Siglar v. State, 541 N.E.2d 944, 946 (Ind. 1989)
(“Failure to interview defense witnesses prior to trial may constitute ineffective
assistance if it appears that such interviews would have produced something
substantive.”).
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 13 of 18
B. Fingerprint Evidence
[19] Warren also contends Epstein was ineffective because he failed to utilize
exculpatory fingerprint evidence. Specifically, Warren alleges “Mr. Epstein
failed to present evidence that fingerprints belonging to Aaron Gill, Gallery No.
470350, were found on cellophane in the backroom of Mr. Dorfman’s shop
near his body. Mr. Epstein was aware of this evidence but inexplicably failed to
use it.” (Appellant’s Br. at 24) (internal citations omitted). At the
postconviction hearing, Epstein testified:
Aaron Gill I might have suggested as an alternative suspect and I
might have requested more specific discovery pertaining to his
whereabouts on the occasion and any number of other things that
might have suggested somebody other than Mr. Warren shot Mr.
Dorfman.
(Tr. Vol. II at 36.)
[20] Warren cites Fisher v. State, in which Fisher’s trial counsel failed to present at
trial evidence that had been elicited during Fisher’s juvenile waiver hearing
about three potential witnesses who failed to identify Fisher in a lineup. 878
N.E.2d 457, 464 (Ind. Ct. App. 2007), trans. denied. We held Fisher’s trial
counsel’s failure to elicit such testimony did not constitute deficient
performance or prejudice Fisher because Fisher’s trial counsel introduced
evidence on cross examination that one of the potential witnesses failed to
identify Fisher in a lineup and Fisher’s trial counsel cross-examined the victim
regarding her identification of Fisher. Id. We also held Fisher’s trial counsel’s
failure to elicit testimony that officers were unable to lift fingerprints from the
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 14 of 18
victim’s doorknob or telephone did not prejudice Fisher because those items
were routinely handled by multiple persons, making it difficult to lift
fingerprints off of them. Id. at 465.
[21] Warren also cites Miller v. State, in which Miller argued that his trial counsel
was ineffective because he failed to identify and elicit testimony from a shoe
and tire print examiner that the shoe and tire prints found at the scene of a
murder did not match Miller’s shoes or his vehicle’s tires. 702 N.E.2d 1053,
1063-64 (Ind. 1998), reh’g denied, cert. denied 528 U.S. 1083 (2000). Our Indiana
Supreme Court held Miller’s trial counsel’s performance was not deficient and
did not prejudice Miller because the State elicited testimony from a police
officer that soil samples could not be connected with Miller’s car or shoes. Id.
at 1064.
[22] Warren argues his case is different from both Fisher and Miller because Epstein
did not introduce evidence of Gill’s prints through the State’s witnesses. The
State maintains the fingerprint evidence was inadmissible because there is no
evidence besides the presence of Gill’s fingerprints on a bag in the shop that
connects Gill to the robbery and murder. The State also argues it is not
surprising that someone else’s fingerprints would be found on cellophane wrap
in Dorfman’s store given the nature of Dorfman’s business. Nonetheless, we
hold the possible presence of someone other than Warren at the crime scene is a
lead worth investigating because it suggests a possible alternative perpetrator.
See Shuemak v. State, 258 N.E.2d 158, 159 (Ind. 1970) (noting “it is universally
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 15 of 18
recognized a finger, palm, or bare footprint found in the place where a crime
was committed may be sufficient proof of identity”).
2. Probability of Different Outcome
[23] Having determined that trial counsel’s performance was deficient, we must
evaluate whether “there is a reasonable probability that, but for counsel’s
unprofessional errors, the result of the proceeding would have been different. A
reasonable probability is a probability sufficient to undermine confidence in the
outcome.” Strickland, 466 U.S. at 694. In effect, Warren must show his trial
counsel’s failures were so prejudicial they denied him a fair trial. Turner v. State,
669 N.E.2d 1024, 1027 (Ind. Ct. App. 1996), reh’g denied, trans. denied.
[24] The State presented substantial evidence implicating Warren. Warren used
Dorfman’s credit cards on the day of the murder. Warren went into Emerson
Liquors on January 7, 1999, and purchased alcohol and cigarettes using one of
Dorfman’s credit cards. He also used Dorfman’s credit cards at a Meijer store
and a Kmart store. Moreover, he tried to purchase items at a Radio Shack store
with Dorfman’s credit cards. Even before Warren presented Dorfman’s credit
card, the Radio Shack employees were suspicious because Warren’s interest
jumped from item to item, and Warren put the hood of his jacket up over his
head when he saw a visible camera outside the restroom. When Dorfman’s
card was declined, Warren threw down another credit card that belonged to
Dorfman for the clerk to try. Warren left the store without taking the credit
cards with him, without completing a purchase and without waiting for the
cashier to try the second card. Also, the day before the murder, Warren had
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 16 of 18
been in Dorfman’s shop and announced he would “be back” as he was escorted
out of the shop. Warren, 757 N.E.2d at 999.
[25] Warren’s inked fingerprint was found on a pawn card at the scene of the
murder, and no other pawn cards with inked fingerprints on them were found at
the scene. Dorfman’s friend Craig Cross testified that Dorfman would not
leave completed pawn cards lying around his store, and he would generally
mail the pawn cards to the Indianapolis Police Department within a day of
receiving them. Detective Alan Jones interrogated Warren after Dorfman’s
murder. Warren admitted visiting Dorfman’s store. Warren told Detective
Jones
that as he was leaving the store he slipped on the ice and when he
fell he found a plastic bag containing credit cards and some gold.
[Detective Jones] asked him specifically what he did with the
credit cards and he said that he threw them away. [Detective
Jones] then asked him if he had used them at all and he said that
he had not, that that was illegal.
(Prior Case-Record of Proceedings Vol. III at 687.) Warren denied ever
pawning anything at Dorfman’s store or filling out a pawn card.
[26] Additionally, a .22 caliber gun killed Dorfman, and Paul Fancher bought a .22
caliber revolver from one of Warren’s brothers shortly after the murder. Also,
notably, while the evidence revealed at the post-conviction relief hearing
potentially implicates other individuals, it does not exonerate Warren. Even
though Warren’s trial counsel’s performance was deficient, he has failed to
show a reasonable likelihood the result of his trial would have been different.
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 17 of 18
Therefore, we hold he is not entitled to post-conviction relief. See Williams v.
State, 706 N.E.2d 149, 156 (Ind. 1999) (holding even if defendant’s trial
attorneys would have more thoroughly investigated blood evidence, they would
not have been able to present information to the jury significantly different from
that provided by the State’s witnesses), reh’g denied, cert. denied 529 U.S. 1113
(2000).
Conclusion
[27] Warren’s trial counsel acknowledges he did not adequately investigate a
potential alternative suspect or follow-up on a lead that another individual’s
fingerprints were present at the scene of Dorfman’s murder. However, despite
trial counsel’s deficient performance, we cannot say there was a reasonable
probability the outcome of Warren’s trial would have been different because of
the overwhelming evidence of Warren’s guilt presented at trial. We accordingly
affirm.
[28] Affirmed.
Bailey, J., and Brown, J., concur.
Court of Appeals of Indiana | Opinion 19A-PC-1604 | April 8, 2020 Page 18 of 18 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523672/ | RECOMMENDED FOR PUBLICATION
Pursuant to Sixth Circuit I.O.P. 32.1(b)
File Name: 20a0109p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
UNITED STATES OF AMERICA, ┐
Plaintiff-Appellee, │
│
> No. 18-1821
v. │
│
│
CHRISTOPHER PAYTON MAY-SHAW, │
Defendant-Appellant. │
┘
Appeal from the United States District Court
for the Western District of Michigan at Grand Rapids.
No. 1:17-cr-00057-1—Paul Lewis Maloney, District Judge.
Argued: January 28, 2020
Decided and Filed: April 8, 2020
Before: MERRITT, CLAY, and BUSH, Circuit Judges.
_________________
COUNSEL
ARGUED: Patrick J. Hanley, Covington, Kentucky, for Appellant. Tonya R. Long, UNITED
STATES ATTORNEY’S OFFICE, Grand Rapids, Michigan, for Appellee. ON BRIEF: Patrick
J. Hanley, Covington, Kentucky, for Appellant. Sally J. Berens, UNITED STATES
ATTORNEY’S OFFICE, Grand Rapids, Michigan, for Appellee. Christopher Payton
May-Shaw, Sandstone, Minnesota, pro se.
_________________
OPINION
_________________
JOHN K. BUSH, Circuit Judge. Christopher May-Shaw was sentenced to 144 months in
prison after he entered a conditional guilty plea to a charge of conspiracy to distribute cocaine.
No. 18-1821 United States v. May-Shaw Page 2
The conviction arose from police surveillance of a parking lot near his apartment building and a
covered carport next to that building, where May-Shaw parked his BMW, one of his several
vehicles. The surveillance lasted for twenty-three days and used a camera affixed to a telephone
pole on a public street and cameras in a surveillance van parked in the parking lot. After
witnessing May-Shaw engage in several suspected drug deals, the police used a drug-detecting
dog to sniff the BMW. The dog indicated the presence of narcotics in the vehicle. Based on the
dog sniff and the surveillance, the officers obtained a search warrant for May-Shaw’s apartment
and all of his vehicles. The search found evidence of drug distribution, including cash, wrappers,
and cocaine. The district court denied his motion under the Fourth Amendment to suppress the
evidence from his apartment and vehicles. May-Shaw then entered a conditional guilty plea for
conspiracy to distribute cocaine, but he preserved the right to appeal the denial of his motion to
suppress.
As explained below, May-Shaw did not have a reasonable expectation of privacy in the
carport such that police surveillance constituted a search in violation of the Fourth Amendment.
Nor was the carport within the curtilage of his apartment such that the dog sniff was
unconstitutional. Therefore, we AFFIRM the district court’s denial of May-Shaw’s motion to
suppress.
I.
In December 2015, the City of Grand Rapids Police Department began investigating
May-Shaw for suspected involvement in drug trafficking. The Department had received tips
from Silent Observer—an organization that receives anonymous information from the public—
describing vehicles May-Shaw was using to transport drugs and a specific bag where he kept
drugs, money, and a gun. A criminal history check on May-Shaw revealed that he had one
felony firearm conviction and two felony drug convictions. Based on all of this information, the
Grand Rapids police decided to conduct surveillance of the exterior of May-Shaw’s apartment
building and the parking lot of the apartment complex.
The apartment where May-Shaw lived is one of several units in the complex, which itself
abuts a communal parking lot. In the parking lot are covered carports, the interiors of which are
No. 18-1821 United States v. May-Shaw Page 3
easily viewable from a public vantage point on Norman Drive, a road outside of the parking lot.
May-Shaw often parked his vehicles under a covered carport close to the entrance to his
apartment building. Nothing in the record indicates whether the carport was specifically
assigned to him, or if he had just consistently parked there.
The carport is next to a parking lot that is accessible only from Norman Drive, and that
entrance affords almost complete visibility of the lot and adjacent apartment complex. The
owner of the complex gave police permission to conduct physical and video surveillance of the
lot. They had a good view, for only a line of trees obstructs the parking lot from public view on
the road, and there was no foliage obstructing the view in February 2016, when the surveillance
occurred.
Most of the stakeout, lasting several weeks, was done from a van using remotely operated
cameras. Officers would park the van in the lot, moving its location every day or two. Through
this method, police observed May-Shaw loading and unloading drugs and cash from his BMW
and engaging in what officers believed to be drug deals in the parking lot.
In addition to their surveillance from the van, on January 26, 2016, police installed a
camera on a telephone pole on Norman Drive. Officer Mesman, the principal investigator in
May-Shaw’s case, testified as to the specifics of the pole camera. According to Mesman, the
camera was affixed to the pole approximately twenty feet from the ground, and could pan from
side to side and up and down. The camera, which recorded continuously for twenty-three days,
could produce video as well as still shots. Though officers did not monitor the footage
continuously in real time, they reviewed the footage they missed by watching the recorded video.
The pole-camera and van-camera footage captured May-Shaw engaging in what the
officers suspected were drug transactions in the parking lot. They based this conclusion on
observations of May-Shaw making brief contact with people inside their vehicles, during which
time he and the person in the car exchanged something. Also, on several occasions May-Shaw
retrieved what appeared to be evidence of drug distribution from his vehicles. For example, on
February 17, 2016, officers observed him lean into the front passenger side of one of his vehicles
and remove cash and a bag of suspected drugs, hide the items under his jacket, and carry them
No. 18-1821 United States v. May-Shaw Page 4
inside the apartment. The next day, officers watched May-Shaw reach into the back of his car
and remove a large stack of cash, which he also took inside the apartment. Soon thereafter, the
officers saw him put another two bags, which they also suspected contained drugs and cash, in
the trunk of his BMW.
After witnessing such suspected drug transactions, the officers called in a K-9 unit for a
drug-detecting dog sniff of the BMW, where the officers had just seen May-Shaw stash the bags.
When the dog circled the BMW, which was parked directly under the carport, it alerted the
officers to the odor of narcotics.
Based on the surveillance and dog sniff, the officers sought a search warrant. The police
relied primarily on the footage from the pole camera and the surveillance van, which showed
different angles of the same conduct described earlier. A state magistrate judge authorized a
search warrant for the apartment and three vehicles connected to May-Shaw. The apartment
search resulted in seizure of almost $2,000 in cash, a gun, drug paraphernalia and packaging
material, and nearly a pound of marijuana. In their search of the BMW, police found a kilogram
of cocaine, some fentanyl, and over $200,000 in cash. The search of one of May-Shaw’s other
vehicles, a Chevrolet Tahoe, turned up another $486 in cash. Neither May-Shaw nor his third
car was present when the police conducted the search. May-Shaw was arrested some months
later in Brooklyn, New York.
A federal grand jury in the U.S. District Court for the Western District of Michigan
returned a superseding indictment charging May-Shaw with conspiracy to distribute and possess
with intent to distribute cocaine, possession with intent to distribute cocaine, and maintaining
drug-involved premises, in violation of 21 U.S.C. §§ 846, 841(b)(1)(A) and 856.
May-Shaw moved the district court to suppress the evidence seized pursuant to the search
warrant, arguing that the warrantless surveillance through the pole camera and the warrantless
sniff by the drug-detecting dog of the BMW constituted unconstitutional warrantless searches.
The district court denied the motion, holding that (1) May-Shaw had no reasonable expectation
of privacy in the parking lot; (2) the area surveilled by the pole camera was not constitutionally
protected curtilage of the apartment; (3) the dog sniff was permitted under the Fourth
No. 18-1821 United States v. May-Shaw Page 5
Amendment; and (4) even if the dog sniff was unconstitutional, the remainder of the information
in the warrant affidavit was sufficient to support probable cause for the search warrant.
May-Shaw entered a conditional guilty plea to the conspiracy count, preserving the right
to appeal the denial of the motion to suppress. He was sentenced to 144 months in prison. He
filed this timely appeal.
II.
When reviewing a district court’s decision on a motion to suppress, we use a mixed
standard of review, reviewing findings of fact for clear error and conclusions of law de novo.
United States v. Hines, 885 F.3d 919, 924 (6th Cir. 2018). Evidence should be viewed in the
light most favorable to the district court’s conclusions. United States v. McCraney, 674 F.3d
614, 616–17 (6th Cir. 2012). “[A] denial of a motion to suppress will be affirmed on appeal if
the district court’s conclusion can be justified for any reason.” United States v. Moorehead,
912 F.3d 963, 966 (6th Cir. 2019) (alteration in original) (quoting United States v. Pasquarille,
20 F.3d 682, 685 (6th Cir. 1994)).
May-Shaw’s motion to suppress invokes the Fourth Amendment, which protects “[t]he
right of the people to be secure in their persons, houses, papers, and effects, against unreasonable
searches and seizures.” U.S. Const. amend. IV. May-Shaw maintains that his Fourth
Amendment rights were violated when the police conducted warrantless surveillance of the
carport outside of his apartment, and when they used a drug-detecting dog to sniff his car that
was parked in that carport. We address each argument in turn.
A.
May-Shaw argues that the district court erred in finding that the long-term surveillance of
the carport did not constitute a search. Under Fourth Amendment jurisprudence, there are two
ways in which government action may constitute a search. First, when the government gains
information by physically intruding into a constitutionally protected area—namely, “persons,
houses, papers, and effects,” U.S. Const. amend. IV—“‘a search within the original meaning of
the Fourth Amendment’ has ‘undoubtedly occurred.’” Morgan v. Fairfield Cty., 903 F.3d 553,
No. 18-1821 United States v. May-Shaw Page 6
561 (6th Cir. 2018) (quoting Florida v. Jardines, 569 U.S. 1, 5 (2013)). Second, as articulated
by the Supreme Court, a search occurs when “a government official invades an area in which ‘a
person has a constitutionally protected reasonable expectation of privacy.’” Taylor v. City of
Saginaw, 922 F.3d 328, 332 (6th Cir. 2019) (quoting Katz v. United States, 389 U.S. 347, 360
(1967) (Harlan, J., concurring)). Under the latter framework, there are two requirements for a
government intrusion to constitute a Fourth Amendment search: first, a person must exhibit “an
actual (subjective) expectation of privacy” in the place or thing searched; second, the expectation
is one “that society is prepared to recognize as ‘reasonable.’” Katz, 389 U.S. at 361.
Because the officers’ use of the pole camera did not involve any sort of physical intrusion
into a constitutionally protected area, May-Shaw must show that he had a reasonable expectation
of privacy in the carport. Cobbling together dicta from several Fourth Amendment cases, he
argues that, although police may permissibly observe the curtilage of a home for a short period
of time, for example with an aerial flyover, see California v. Ciraolo, 476 U.S. 207, 213 (1986),
long-term video surveillance of a home’s curtilage is problematic under the Fourth Amendment,
see United States v. Anderson-Bagshaw, 509 F. App’x 396, 405 (6th Cir. 2012). There is at least
some support for that proposition, as this court and five Justices of the Supreme Court have
noted concerns about the problems with long-term warrantless surveillance. See id.; see also
United States v. Jones, 565 U.S. 400, 415, 429–30 (2012) (Sotomayor, J., concurring and Alito,
J., concurring).
Although this argument may be compelling in theory, as applied here, it is foreclosed by
this circuit’s case law, which has consistently held that this type of warrantless surveillance does
not violate the Fourth Amendment. For example, in United States v. Houston, we held that
affixing a video camera to the top of a utility pole to record the defendant’s front porch over a
ten-week period did not violate the defendant’s Fourth Amendment rights because “agents only
observed what [the defendant] made public to any person traveling on the roads” surrounding his
home. 813 F.3d 282, 288 (6th Cir. 2016). We rejected the defendant’s claim that the length of
the period of monitoring made the surveillance constitutionally unreasonable, reasoning that it is
the possibility—not the practicability—that the police could have themselves sat atop the utility
pole and observed the same view for every waking moment of a ten-week period that is critical.
No. 18-1821 United States v. May-Shaw Page 7
Id. at 289–90. That reasoning was applied in United States v. Powell, in which we held that the
warrantless surveillance of three buildings through the installation of video cameras on three
public utility poles, for periods of up to 90 days each, did not violate the defendants’ Fourth
Amendment rights. 847 F.3d 760, 773 (6th Cir. 2017). And, even assuming that May-Shaw is
correct that the carport constitutes the curtilage of his apartment—an argument that we find
unpersuasive, for reasons discussed below—that is of no consequence to the constitutional
analysis of the video surveillance. We held in Houston that warrantless video surveillance of the
defendant’s front porch, which is unquestionably within the curtilage of his home, did not violate
his reasonable expectation of privacy because the camera “captured only views that were plainly
visible to any member of the public who drove down the roads bordering” his home. Houston,
813 F.3d at 288.
May-Shaw contends that the pole camera did not provide the same vantage point that was
readily accessible from the street.1 The district court, however, held that the area surveilled by
the pole camera was readily accessible from a public vantage point. This is a factual finding that
is reviewed for clear error. Officer Mesman testified that the vantage point from the pole camera
was the same as the vantage point from the street, and nothing in the record contradicts that
assertion. Therefore, the district court’s factual finding that the pole camera recorded the same
view enjoyed by an individual standing on Norman Avenue was not clearly erroneous.
Furthermore, the surveillance footage and photos here did not “generate[] a precise,
comprehensive record of [May-Shaw’s] public movements that reflects a wealth of detail about
[his] familial, political, professional, religious, and sexual associations,” Jones, 565 U.S. at 415
1The parties dispute which camera or cameras recorded the illicit activity. May-Shaw claims that the
footage was captured by the pole camera, whereas the government maintains that the incriminating footage came
from the cameras in the van. Though the officers did not keep a log of which images came from each camera, a
comparison of two sets of photos available at R. 60-2, PageID 236–37 clearly indicates that the close-up images
showing May-Shaw engaged in suspected drug transactions did not come from the more remote camera affixed to
the telephone pole. May-Shaw does not point to anything other than the lack of a log to suggest that the images did
not come from the surveillance van cameras. Appellant Br. at 13. If the images were in fact recorded from the
surveillance van rather than from the pole camera, then this is a simple case of police surveillance from a publicly
accessible area, in which the police had permission to conduct the surveillance. This does not raise the same Fourth
Amendment concerns. See United States v. Gooch, 499 F.3d 596, 602–03 (6th Cir. 2007) (noting that an individual
does not have a reasonable expectation of privacy in an openly accessible parking lot, and so police surveillance in
that lot did not constitute a search).
No. 18-1821 United States v. May-Shaw Page 8
(Sotomayor, J., concurring), which could raise significant Fourth Amendment concerns. Rather,
the footage and photos only revealed what May-Shaw did in a public space—the parking lot.
They captured images of May-Shaw moving things from his car to his apartment. The video
showed when he arrived and left the apartment. In other words, the cameras observed only what
“was possible for any member of the public to have observed . . . during the surveillance period.”
Houston, 813 F.3d at 290.
May-Shaw has not demonstrated that when the government surveilled the carport for
twenty-three days, it violated his reasonable expectation of privacy and thus conducted an
unconstitutional search. We find no error in the district court’s judgment that the pole-camera
surveillance did not violate May-Shaw’s Fourth Amendment rights.
B.
May-Shaw also argues that the district court should have granted his motion to suppress
because the use of the drug-detecting dog to sniff his BMW while it was parked in the carport
constituted an unlawful search under the Fourth Amendment. This argument hinges on one
issue: whether the carport where the vehicle was parked constitutes the curtilage of the
apartment.
As relevant here, the Fourth Amendment protects the people from “unreasonable
searches” of “their . . . houses.” And, as a general rule, the curtilage of a home is protected by
the Fourth Amendment. See United States v. Dunn, 480 U.S. 294, 300 (1987); see also Jardines,
569 U.S. at 6 (noting that the area “immediately surrounding and associated with the home” is
“part of the home itself for Fourth Amendment purposes” (quoting Oliver v. United States, 466
U.S. 170, 180 (1984))). That rule is well-rooted in history. “At the founding, curtilage was
considered part of the ‘hous[e]’ itself.” Collins v. Virginia, 138 S. Ct. 1663, 1676 (2018)
(Thomas, J., concurring) (alteration in original) (quoting 4 W. Blackstone, Commentaries on the
Laws of England 225 (1769) (“[T]he capital house protects and privileges all its branches and
appurtenants, if within the curtilage.”)). “The protection afforded the curtilage is essentially a
protection of families and personal privacy in an area intimately linked to the home, both
No. 18-1821 United States v. May-Shaw Page 9
physically and psychologically, where privacy expectations are most heightened.” Id. at 1670
(majority opinion) (quoting Ciraolo, 476 U.S. at 212–213).
Although it is well-settled that the warrantless search of a home’s curtilage with a drug-
sniffing dog violates the Fourth Amendment, Jardines, 569 U.S. at 11–12, what constitutes
curtilage for purposes of the Fourth Amendment generally, and in the present case in particular,
are harder questions. If the carport was within the curtilage of May-Shaw’s apartment, then the
dog sniff constituted an unconstitutional warrantless search under Jardines, but if the carport was
not within the curtilage, then the sniff was not a search, and therefore was not constitutionally
problematic. See United States v. Perez, 440 F.3d 363, 375 (6th Cir. 2006) (holding that using a
drug-sniffing dog on a car parked in a hotel parking lot, which was not stopped, detained, or
moved, did not constitute a search).
Courts have identified four factors as guideposts to determining whether an area falls
within a home’s curtilage: (1) the proximity of the area to the home, (2) whether the area is
within an enclosure around the home, (3) how that area is used, and (4) what the owner has done
to protect the area from observation from passersby. Morgan, 903 F.3d at 561 (citing Dunn, 480
U.S. at 301). These factors are not to be applied mechanically; rather, they are “useful analytical
tools only to the degree that, in any given case, they bear upon the centrally relevant
consideration—whether the area in question is so intimately tied to the home itself that it should
be placed under the home’s ‘umbrella’ of Fourth Amendment protection.” Dunn, 480 U.S. at
301. In the application of the factors, the onus is on May-Shaw: he “bears the burden of
establishing that the challenged search violated his Fourth Amendment rights.” United States v.
Coleman, 923 F.3d 450, 455 (6th Cir. 2019) (quoting United States v. Witherspoon, 467 F.
App’x 486, 490 (6th Cir. 2012)).
The Supreme Court recently held that an enclosed driveway abutting a house constituted
the curtilage of the home. Collins, 138 S. Ct. at 1670–71. In Collins, police searched a
motorcycle that was covered by a tarp and was parked in a section of a driveway that was
partitioned off by two brick walls and a wall of the house itself. Id. at 1670. “A visitor
endeavoring to reach the front door of the house would have to walk partway up the driveway,
but would turn off before entering the enclosure and instead proceed up a set of steps leading to
No. 18-1821 United States v. May-Shaw Page 10
the front porch.” Id. at 1671. The Court held that the driveway enclosure “constitute[d] ‘an area
adjacent to the home and “to which the activity of home life extends,”’ and so is properly
considered curtilage.” Id. (quoting Jardines, 569 U.S. at 7).
May-Shaw argues that Collins is dispositive here, and that because the carport was
partially enclosed, it constitutes the curtilage of the apartment. But Collins does not mandate
that result. At least three cases in this circuit cut against May-Shaw’s position.
First, there is Coleman, mentioned above. There, we found that the defendant’s car was
not within the curtilage of his condo when it was parked in his condominium complex’s
driveway, reasoning in part that the driveway was communal and other condo residents
frequently walked past cars parked in front of the condo units. 923 F.3d at 456–57; see also
United States v. Jones, 893 F.3d 66, 72 (2d Cir. 2018) (“[Collins] has no effect on [the
defendant’s] appeal, which fails because the driveway in which [the defendant’s] vehicle was
parked was the shared driveway of tenants in two multi-family buildings and was not within the
curtilage of [his] private home.”).
In addition, two Sixth Circuit cases decided prior to Collins—United States v. Galaviz,
645 F.3d 347 (6th Cir. 2011), and United States v. Estes, 343 F. App’x 97 (6th Cir. 2009)—are
instructive. Those cases involved unenclosed driveways that were adjacent to a home, and
abutted a sidewalk or alley, with no steps taken by the resident to obstruct the view of passersby.
Galaviz, 645 F.3d at 356; Estes, 343 F. App’x at 101. In both cases, we held that officers did not
intrude upon the curtilage by entering the driveway. In Galaviz we found that although the
driveway was adjacent to the house, it was not enclosed by any barrier, and the portion where
cars were parked was directly adjacent to a public sidewalk. Galaviz, 645 F.3d at 356. And in
Estes, the driveway was not curtilage because it was not enclosed, the defendant had not taken
any steps to protect it from observation by passersby, and it was used as a point of entry to the
defendant’s residence. Estes, 343 F. App’x at 101.
May-Shaw directs the court’s attention to several cases—one from the Sixth Circuit, and
three from district courts within our circuit—in an attempt to establish a broad rule that a carport
is always within the curtilage of a home. See Appellant Br. at 26. But each of the cases he cites
No. 18-1821 United States v. May-Shaw Page 11
is factually distinct. As the first case he cites for that proposition states, “[e]very curtilage
determination is distinctive and stands or falls on its own unique set of facts.” Daughenbaugh v.
City of Tiffin, 150 F.3d 594, 598 (6th Cir. 1998) (alteration in original) (quoting United States v.
Reilly, 76 F.3d 1271, 1276 (2d Cir. 1996))).
In Daughenbaugh, as May-Shaw notes, our court held that a detached garage was within
the curtilage of a home. Id. at 601. But there, the garage was “within natural boundaries
demarcated by the river and the heavy tree coverage . . . [and] the backyard and garage [were]
not readily visible from the street.” Id. at 599. We considered these natural boundaries to be
compelling evidence that the garage was within the curtilage of the home. Id. Furthermore, the
garage was set far back from the road, and a large tree prevented neighbors, those parked in the
driveway, and those on the street from viewing the interior of the garage. Id. at 600. Important
to the court’s calculus was that the “contents [of the garage] were only visible after a person
entered the backyard and approached the garage.” Id.
Here, although the carport where May-Shaw parked his vehicles was the closest in
proximity to his apartment, it was not as close to the residence as other structures found to be
curtilage have been. But in any event, that factor is not determinative “without reference to the
additional Dunn factors.” Daughenbaugh, 150 F.3d at 599. In Collins, Coleman, Galaviz, and
Estes, the areas at issue were all driveways that, unlike the carport here, directly abutted homes
or condominiums. And even in those cases where the driveway was connected to the home, the
courts each held that the driveway was not curtilage.
The second factor—whether the area is an enclosure around the home—also cuts against
May-Shaw. Here, although the area was enclosed, at least to the extent that the carport had a
roof and two side walls, it was not in an enclosure around the residence as was the walled-off
driveway in Collins, nor was it enclosed within natural boundaries of the property like the
detached garage in Daughenbaugh.
The third factor, which relates to May-Shaw’s use of the carport, arguably weighs in his
favor because, by regularly parking his car in the carport, he contends it was sufficiently
“associated with the activities and privacies of domestic life” to ostensibly support a finding that
No. 18-1821 United States v. May-Shaw Page 12
it was within the curtilage of his apartment. Dunn, 480 U.S. at 303. However, there is no
evidence that May-Shaw had any legal right to exclude others from the carport.
Furthermore, May-Shaw did little to protect the area from the view of passersby, and so
the fourth factor weighs against him. With respect to this last consideration, May-Shaw’s case
falls somewhere in between Collins and Coleman. Like the driveway in Collins, the carport here
was partially enclosed, which cuts at least somewhat in his favor. But, like in Coleman, May-
Shaw took no additional steps to protect the area from passersby. He did not, as did the
petitioner in Collins, cover his vehicle to shield it from view from his neighbors. See 138 S. Ct.
at 1668. And because officers could see into the carport from a camera affixed to a utility pole
across a street, it is apparent that May-Shaw did not take significant steps to protect the area from
observation.
The burden is on May-Shaw to establish that the carport is “intimately linked to the
home, both physically and psychologically, where privacy expectations are most heightened.”
Collins, 138 S. Ct. at 1670 (quoting Ciraolo, 476 U.S. at 212–13). He has not done so. May-
Shaw has failed to establish that the carport constituted the curtilage of his apartment; the drug
dog sniff therefore did not constitute a search. See Perez, 440 F.3d at 375. Because we hold that
neither the pole-camera surveillance nor the dog sniff constituted a search, we need not decide
whether the evidence would have been admissible under the independent-source doctrine or the
good-faith exception.
III.
May-Shaw has not shown that (1) police surveillance from the pole camera violated his
reasonable expectation of privacy; or (2) the dog sniff constituted an unconstitutional search.
Therefore, we AFFIRM the district court’s denial of his motion to suppress. | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3304866/ | Application for a writ of certiorari to review a judgment of foreclosure of mortgage in so far as it is claimed to affect petitioner, a junior mortgagee. The petitioner was originally made a party defendant, as one claiming some interest as purchaser or mortgagee, which interest was alleged to be subsequent to and subject to the lien of the mortgage sought to be foreclosed. Petitioner alleges that it was never served with summons, and never had notice of the action until the time for appeal from the judgment had expired.
The judgment given recites that the action was dismissed as to said petitioner, with the result that if its mortgage was recorded, as is alleged, prior to the recording on April 7, 1914, of the notice of lis pendens in the foreclosure action, the situation is precisely as it would have been if petitioner had never been a party to the action, and its interest as a mortgagee is in no way affected by the judgment of foreclosure, or the sale thereunder. The judgment given, properly construed, does not purport to bar anyone claiming under defendant Chase, whose interest in the premises was acquired prior to the filing for record of the notice of lis pendens on April 7, 1914, and was properly shown on the public records.
The application for a writ is denied. *Page 752 | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4523675/ | NOT RECOMMENDED FOR PUBLICATION
File Name: 20a0201n.06
No. 19-1034
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
FILED
CHAREE STANLEY, ) Apr 08, 2020
) DEBORAH S. HUNT, Clerk
Plaintiff-Appellant, )
)
v. ON APPEAL FROM THE
)
UNITED STATES DISTRICT
EXPRESSJET AIRLINES, INC., )
COURT FOR THE EASTERN
)
Defendant-Appellee. DISTRICT OF MICHIGAN
)
)
BEFORE: BOGGS, BATCHELDER, and DONALD, Circuit Judges.
ALICE M. BATCHELDER, Circuit Judge. Recognizing the critical role the transportation
sector serves in the country’s security and prosperity, Congress amended the Railway Labor Act
(“RLA”) in 1934 to require that all minor labor disputes in these vital industries be resolved by
arbitration. Union Pac. R.R. Co. v. Bhd. of Locomotive Eng’rs, 558 U.S. 67, 72-73 (2009). Rather
than having every issue that would invariably arise in the workplace litigated through the court
system, Congress instead sought to facilitate the “peaceful and efficient resolution” of employees’
grievances through arbitration whenever the governing collective bargaining agreement (“CBA”)
addressed those issues, including pay or working conditions. Id. at 72; 45 U.S.C. § 151 et seq. As
the Supreme Court and this circuit have repeatedly held, when a claim can be resolved conclusively
by the CBA, the claim is preempted1 and must be brought before an arbitrator, not a court.
1
Federal claims are said to be “precluded,” while state claims are said to be “preempted.” For the purposes of the
RLA, this is a distinction without a difference, as the same standard applies for both preclusion and preemption, i.e.,
whether the claim could be conclusively resolved by the CBA. See e.g. Brown v. Illinois Central R.R. Co., 254 F.3d
654, 662 (7th Cir. 2001) (“[W]e find the preemption question sufficiently similar to the preclusion question to make
No. 19-1034, Stanley v. ExpressJet
Hawaiian Airlines, Inc. v. Norris, 512 U.S. 246, 252 (1994); Emswiler v. CSX Transp., Inc., 691
F.3d 782, 792 (6th Cir. 2012).
In the case before us, Charee Stanley, a practicing Muslim and formerly employed flight
attendant at Defendant ExpressJet Airlines, Inc. (“ExpressJet”), brought a federal religious
discrimination claim under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq.
(“Title VII”), and a state religious discrimination claim under Michigan’s Elliott-Larsen Civil
Rights Act, Mich. Comp. Laws § 37.2101, et seq. (“ELCRA”), as well as a retaliation claim.
Stanley requested and was denied an accommodation that would excuse her from her duties of
preparing and serving alcohol during flights, which Stanley says her religion forbids. The question
we must answer, however, is not whether Stanley’s claims have any merit, but whether we may
hear her claims in the first place. If Stanley’s claims can be conclusively resolved by the CBA,
then they are preempted by the RLA. The district court granted ExpressJet’s motion for summary
judgment, holding that Stanley’s religious-discrimination claims were preempted under the RLA
and that she failed to create a genuine issue of material fact for her retaliation claim, which also
would have been preempted. For the reasons below, we AFFIRM the district court as to all claims.2
the analysis employed in the RLA preemption cases applicable here.”); Parker v. American Airlines, Inc., 516 F. Supp.
2d 632, 637-38 (N.D. Tex. 2007) (“Arbitral boards established under the RLA enjoy exclusive jurisdiction to resolve
all disputes requiring the construction or application of a CBA regardless of whether the dispute involves a state-law
claim or a federal claim. When applied to a state-law claim, the RLA is said to preempt. But when applied to a federal
claim, the RLA is said to preclude.”) (citation omitted); VanSlyck v. GoJet Airlines, LLC, 323 F.R.D. 266, 269 (N.D.
Ill. 2018) (“It is well settled that the RLA requires mandatory arbitration of so-called ‘minor disputes,’ which are those
requiring ‘interpretation or application’ of a CBA. Such disputes are thus ‘preempted’ (if raised in a state claim) or
‘precluded’ (if raised in a federal claim).”(citation omitted)). While recognizing the difference between preclusion and
preemption, we will refer to both Stanley’s federal and state claims as “preempted” for the sake of brevity and clarity.
2
On June 7, 2019, ExpressJet filed a motion for leave to file a sur-reply. The motion was referred to the merits panel
for consideration along with the briefs as filed. Because new arguments first raised in a reply brief are generally not
considered and given the final disposition of this case, we DENY ExpressJet’s motion. See United States v. Jenkins,
871 F.2d 598, 602, n. 3 (6th Cir. 1989) (“[C]ourt decisions have made it clear that the appellant cannot raise new
issues in a reply brief.”).
-2-
No. 19-1034, Stanley v. ExpressJet
I.
In January 2013, just a few weeks after converting to Islam, Charee Stanley began working
for ExpressJet as a flight attendant. As part of her duty as a flight attendant, Stanley was required
to prepare and serve alcoholic drinks to passengers. From January 2013 through June 2015,
Stanley prepared and served alcohol to passengers and was by all accounts a professional and
attentive flight attendant. However, in June 2015, Stanley had a conversation with her imam who
informed her that not only were Muslims forbidden from consuming alcohol, but also from
preparing or serving it. Upon being advised of this, Stanley spoke to Inflight Operations Manager
Melanie Brown the following day. Because Stanley’s next assigned flight was “within minutes”
of departing, Brown suggested Stanley ask the other flight attendant to handle all of the alcoholic
beverages prepared and served during the flight. At this point, the parties’ accounts diverge.
Stanley claimed she understood this would be a permanent solution going forward, while Brown
thought this was a temporary accommodation for “that specific flight” because Stanley “was
beginning to observe Ramadan.”
Regardless, this arrangement was unlikely to succeed in the long-term as it violated several
provisions of the CBA. As an ExpressJet flight attendant, Stanley was a member of the
International Association of Machinists and Aerospace Workers (“the Union”). The CBA was
negotiated between the Union and ExpressJet and governed Stanley’s relationship with ExpressJet
as her employer.
There are three provisions of the CBA pertinent to this dispute. First, flight schedules, as
well as bidding rights, filling of vacancies, vacation preferences, and domicile assignments, are all
based on a flight attendant’s seniority. Second, on a flight with two flight attendants, “[t]he senior
Flight Attendant may choose the ‘A’ or the ‘B’ position on the aircraft.” Flight Attendant A is
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No. 19-1034, Stanley v. ExpressJet
primarily responsible for the First Class passengers, while Flight Attendant B is primarily
responsible for the main cabin. The Flight Attendant Handbook (“FAM”) specifies in more precise
detail the actual duties of each flight attendant. For example, Flight Attendant B (usually the junior
flight attendant) is expected to “prepare beverages” and assist Flight Attendant A with preparing
and serving beverages to the First Class cabin, “including alcoholic beverages.” Third, if a
scheduled flight with two flight attendants is downgraded to a flight with only one flight attendant,
the senior flight attendant has the right to accept or decline the downgrade. If the senior flight
attendant declines the downgrade, the junior flight attendant must accept the assignment.
Stanley’s requested accommodation of having the other flight attendant (who likely would
have seniority given Stanley’s relatively short tenure at ExpressJet) serve all of the alcoholic
beverages on a flight conflicts with the CBA’s seniority provisions in at least four ways. First,
requiring the senior flight attendant to serve alcoholic drinks for both the First Class cabin and the
main cabin violates the CBA provision that permits the senior flight attendant to choose whether
he or she would prefer position A or position B. While the flight attendants are expected to help
one another, it would violate the CBA if ExpressJet were to mandate that the senior flight attendant
accept the alcoholic beverage service duties for both positions. Second, under Stanley’s requested
accommodation, she could refuse a senior flight attendant’s request for assistance with the
alcoholic beverage service to the First Class cabin. Both flight attendants are expected to help one
another, and the FAM specifically mentions that “[Flight Attendant] B should assist with
preparing” alcoholic beverages for first class passengers “while [Flight Attendant] A delivers.”
Third, if a flight with two flight attendants is downgraded to a flight with one flight
attendant and the senior flight attendant declined the assignment (as is his or her right under the
CBA), Stanley, as the junior flight attendant on that flight, would be required to accept the
-4-
No. 19-1034, Stanley v. ExpressJet
assignment. However, if Stanley’s requested accommodation were granted, she could not accept
the assignment as there would be no one on the aircraft who could serve alcoholic beverages to
passengers were she the only flight attendant. If no reserve flight attendants were available,
ExpressJet would be forced to require the senior flight attendant to serve as the single flight
attendant, despite the senior flight attendant’s initially declining the assignment, thus clearly
violating the CBA. Fourth and finally, this reality would mean in effect that Stanley could never
be assigned to a single-flight-attendant flight. However, the preference of flights is determined by
seniority and Stanley’s religious accommodation and corresponding mandatory flight preference
would put her preferences ahead of those of flight attendants with greater seniority in violation of
the CBA. The Union agrees that Stanley’s requested accommodation violates the CBA’s seniority
provisions.
Less than a week after Stanley’s initial meeting with Brown, ExpressJet received its first
complaint from one of Stanley’s coworkers, who complained about having to serve all of the
alcoholic drinks on a flight. Just a week later, Stanley took time off without pay for the month of
Ramadan, which delayed any conflicts at least temporarily. Upon returning later that summer,
Stanley again began asking the other flight attendant to prepare and serve all alcoholic drinks on
each flight she worked. On August 2nd, just two weeks after Stanley returned to work, ExpressJet
received a complaint from another flight attendant who expressed frustration with having to do
“both [flight attendant] A and [flight attendant] B duties.”
On August 18, 2015, Stanley met with Brown, a Union representative, and an ExpressJet
human resources representative to discuss Stanley’s situation. Stanley was presented with three
options: (1) take personal leave and seek another position at the airline, (2) agree to serve and sell
alcohol, or (3) voluntarily resign. Before Stanley decided, ExpressJet placed her on 90-day non-
-5-
No. 19-1034, Stanley v. ExpressJet
disciplinary, unpaid administrative leave, which was soon extended to a year. Stanley rejected the
options ExpressJet presented and instead submitted a formal request for her preferred
accommodation.
ExpressJet rejected Stanley’s request on August 25th. Stanley did not apply for another
position at the airline during her leave and filed suit in federal court a year later in August of 2016.
ExpressJet’s motion to dismiss was denied, but after discovery, ExpressJet filed a motion for
summary judgment that the district court granted. The district court found that Stanley’s religious
discrimination claims were preempted, and that she had failed to make a retaliation claim, which
also would have been preempted if made successfully. Stanley now appeals.
II.
“This court reviews the district court’s grant of summary judgment de novo.” CSX Transp.,
Inc. v. United Transp. Union, 395 F.3d 365, 368 (6th Cir. 2005). “Summary judgment is
appropriate where there is ‘no genuine dispute as to any material fact and the movant is entitled to
judgment as a matter of law.’” Emswiler, 691 F.3d at 788 (citing Fed. R. Civ. P. 56(a)).
Before we may address whether Stanley has a viable Title VII claim or its counterpart state-
law claim, we must first decide whether we can reach the merits of either claim. The RLA, which
was extended to cover airlines in 1936, requires minor disputes to be resolved by arbitration.
Hawaiian Airlines, 512 U.S. at 248. If an issue qualifies as a minor dispute, then an Article III
court cannot reach the merits of the dispute, but rather can only enforce the arbitrator’s decision.
See Dotson v. Norfolk Southern R.R. Co., 52 F. App’x 655, 658 (6th Cir. 2002). In this case,
Stanley did not pursue arbitration, but rather went directly to federal court. The question before
us is whether this issue is preempted by the RLA and therefore must be decided by an arbitrator.
-6-
No. 19-1034, Stanley v. ExpressJet
For a claim to be preempted, the CBA must conclusively resolve the dispute. Emswiler,
691 F.3d at 792. An employer cannot take an otherwise valid claim and cause it to become
preempted by claiming the CBA as a defense. Brown v. Illinois Central R.R. Co., 254 F.3d 654,
668 (7th Cir. 2001). ExpressJet claims that Stanley’s requested accommodation would require it
to violate the CBA and an accommodation that violates the CBA would constitute an undue
hardship. Stanley argues that her prima facie Title VII claim does not require interpretation of the
CBA and the CBA is only implicated, if at all, by ExpressJet’s raising it as a defense. However,
Stanley misstates the extent to which her initial claim implicates the CBA and misunderstands
what constitutes a preempted claim under Sixth Circuit precedent.
In this circuit, we employ a two-step test to determine whether a CBA preempts a claim:
“First, the [] court must examine whether proof of the [] claim requires interpretation of collective
bargaining agreement terms. Second, the court must ascertain whether the right claimed by the
plaintiff is created by the collective bargaining agreement or by state [or federal] law.” DeCoe v.
General Motors Corp., 32 F.3d 212, 216 (6th Cir. 1994). If the right is created by the CBA or if
the interpretation of the CBA is necessary to determine the proof of the claim, then the claim is
preempted. Id.
In this case we must answer three questions: (1) Does a Title VII claim require a court to
assess whether there is undue hardship? (2) Would violating the seniority provisions of the CBA
constitute undue hardship? (3) Would examining the CBA conclusively resolve the question of
undue hardship and therefore the merits of Stanley’s Title VII claim? We answer “yes” to each
question and hold that because the CBA can conclusively resolve Stanley’s religious-
discrimination claims, her claims are preempted under the RLA.
-7-
No. 19-1034, Stanley v. ExpressJet
A.
Title VII requires a plaintiff first to establish a prima facie case. Virts v. Consolidated
Freightways Corp. of Delaware, 285 F.3d 508, 516 (6th Cir. 2002). There are three elements the
plaintiff must show: (1) that the employee holds a sincere religious belief that conflicts with an
employment requirement, (2) that the employee informed the employer about the conflict, and (3)
that the employee was discharged or disciplined for failing to comply with the requirement. Id.
Once a plaintiff has established a prima facie case, the burden shifts to the defendant. Id. In order
to escape liability, the employer must show that the accommodation would create an “undue
hardship.” Id. “To require an employer to bear more than a de minimis cost in order to
accommodate an employee's religious beliefs is an undue hardship.” Id. (quoting Cooper v. Oak
Rubber Co., 15 F.3d 1375, 1378 (6th Cir. 1994)). Given that the statutory text of Title VII clearly
provides for an exception for accommodations that would be an “undue hardship” for the
employer, a court presented with a Title VII claim must always examine whether the requested
accommodation presents an undue hardship. 42 U.S.C. § 2000e(j). Contrary to Stanley’s claims,
undue hardship is not a defense raised to excuse a Title VII violation; rather, undue hardship is a
part of the Title VII analysis, and a Title VII claim cannot be decided unless a court determines
whether the accommodation would in fact impose an undue hardship.
B.
For the purposes of its summary judgment motion, ExpressJet concedes that Stanley has
met the prima facie requirement. It argues that Stanley’s accommodation would force it to violate
the CBA and that constitutes an undue hardship. As we have previously held, a Title VII
accommodation that would force the employer to violate the seniority provisions of the CBA
constitutes an undue hardship. Virts, 285 F.3d at 517-18. It cannot be the case that the law would
-8-
No. 19-1034, Stanley v. ExpressJet
put the employer in an impossible situation where it either faces liability for refusing a religious
accommodation (and respecting the CBA’s seniority provisions) or faces liability for violating the
CBA if it grants the accommodation. This court has reconciled this conflict by holding that when
the accommodation would violate the CBA’s seniority provisions, the accommodation constitutes
an undue hardship and the employer may refuse to grant it. Id.
C.
The third and most important question is not whether the accommodation would be an
undue hardship, but whether the CBA can conclusively resolve Stanley’s Title VII claim. Any
court seeking to address Stanley’s religious-discrimination claims must interpret the CBA.
Because a court hearing a Title VII claim must assess undue hardship and because an
accommodation that violates a CBA’s seniority provisions constitutes undue hardship, we would
need to interpret the CBA to resolve Stanley’s Title VII claim on the merits. For instance, we
would need to determine whether permitting Stanley to refuse a downgraded flight with a single
flight attendant violates the seniority provisions of the CBA. Or whether forcing a senior flight
attendant to serve on a downgraded flight or requiring a flight attendant to accept the alcoholic
beverage service duties of both positions violate those provisions. The answer to these questions
lies in the CBA and only the CBA can resolve them conclusively. Regardless of the outcome, the
CBA resolves the issue; therefore, under the RLA, Stanley’s claims are preempted.
III.
Stanley also brought a retaliation claim against ExpressJet. In order “to prevail on a claim
for retaliatory discharge under Title VII, a plaintiff must first establish a prima facie case by
demonstrating that 1) the plaintiff engaged in an activity protected by Title VII; 2) the exercise of
the plaintiff’s civil rights was known to the defendant; 3) the defendant thereafter undertook an
-9-
No. 19-1034, Stanley v. ExpressJet
employment action adverse to the plaintiff; and 4) there was a causal connection between the
protected activity and the adverse employment action.” Virts, 285 F.3d at 521. Once the plaintiff
successfully establishes a prima facie case, the burden shifts to the defendant who must “articulate
a legitimate, nondiscriminatory reason for its actions.” Id. If the defendant can provide a
legitimate, nondiscriminatory reason, the burden shifts back to the plaintiff, who must
“demonstrate that the proffered reason was a mere pretext for discrimination.” Id. A plaintiff can
successfully demonstrate that the defendant’s reason was a mere pretext by showing that: “1) the
stated reason had no basis in fact; 2) the stated reason was not the actual reason; or 3) the stated
reason was insufficient to explain the defendant’s actions.” Id. In other words, a plaintiff must
show “both that the reason was false, and that discrimination was the real reason.” Id. (quoting St.
Mary’s Honor Ctr. v. Hicks, 509 U.S. 502, 515 (1993) (emphasis in original)).
The district court held that Stanley failed to create a genuine issue of material fact as to the
first element of her prima facie case, i.e., that she engaged in an activity protected by Title VII,
because Stanley never identified what exactly was her “protected activity.” In both her corrected
brief and reply brief on appeal, Stanley still fails to identify what protected activity she engaged in
for which ExpressJet allegedly retaliated against her. Under Title VII, protected activity “can fall
into two categories: participation and opposition.” Perkins v. International Paper Company, 936
F.3d 196, 213 (4th Cir. 2019). More specifically, protected activity means the employee either
(1) opposed an employer’s discriminatory activity or practice made unlawful by Title VII, or
(2) testified, assisted, or participated in an investigation or proceeding under Title VII. 42 U.S.C.
§ 2000(e)-3(a); see 45A Am. J. 2d Job Discrimination § 244. Regardless of which category the
protected activity falls under, for a retaliation claim, “the key question is whether the complaint
-10-
No. 19-1034, Stanley v. ExpressJet
concerns conduct between an employer and its employee.” David C. Singer and Joshua Colangelo-
Bryan, Protected Activity Under Title VII Retaliation Claims, 231 N.Y. L. J. 2 (Feb. 6, 2004).
Even when we construe the facts in Stanley’s favor, we are at a loss to discern what
Stanley’s protected activity could be. It cannot be the case that Stanley was terminated or put on
leave because of her participation in an investigation as Stanley did not participate in any
investigation, nor was ExpressJet the subject of any investigation or proceeding under Title VII
before Stanley’s termination. It also cannot be the case that Stanley faced retaliation for calling
attention to an allegedly discriminatory activity by ExpressJet. Nothing in Stanley’s allegations
accuses ExpressJet of any discriminatory activity. Stanley’s only accusation of animus was against
a fellow flight attendant who questioned Stanley’s choice to read “foreign writings,” while the
other flight attendant was forced to prepare and serve all alcoholic drinks to both cabins.
Notwithstanding the fact that there were likely non-discriminatory reasons for the flight attendant’s
complaint, the accusation is irrelevant to a retaliation claim because the alleged behavior was not
that of the employer, but rather of another employee. Nowhere in Stanley’s recounting of the facts
does she mention discriminatory behavior by ExpressJet, Stanley’s opposing discriminatory
behavior of ExpressJet, or Stanley’s then facing retaliation for opposing any alleged discriminatory
behavior of ExpressJet.
ExpressJet suggested that perhaps Stanley meant that her request for an accommodation
constituted protected activity. A request for an accommodation does not constitute protected
activity under Title VII, which clearly delineates two options: opposition to discriminatory practice
or participation in an investigation. 42 U.S.C. § 2000e-3(a). On appeal, Stanley has again failed
to identify a protected activity she engaged in, and it is not the responsibility of this court to fill in
-11-
No. 19-1034, Stanley v. ExpressJet
the blanks for her. Because Stanley failed to establish the first element of a retaliatory discharge
claim, she cannot establish a prima facie case and, consequently, her retaliation claim fails.
The district court was thorough in analyzing why each of Stanley’s arguments related to
her retaliation claim lacked either a legal or factual basis. The district court concluded that
Stanley’s novel “retaliation by ratification” legal theory3 was not backed by any case law, that
discovery did not reveal any factual support for Stanley’s claims of alleged animus toward her
faith (and if anything, there was actually evidence to the contrary, such as ExpressJet’s approving
her request to wear a hijab), and that her retaliation claim, even if correctly made, would also be
preempted under the RLA. However, because Stanley’s failure to create a genuine issue of
material fact as to whether she had engaged in protected activity is dispositive, we do not need to
consider those other arguments on appeal.
IV.
For the foregoing reasons, we AFFIRM the judgment of the district court on all counts.
3
Stanley appears to have argued that ExpressJet ratified her coworker’s comments about Stanley’s reading “books
with foreign writings” and about Stanley’s hijab by reacting to the complaint that contained them, that these comments
constituted animus, and that the supposed ratification constituted retaliation.
-12- | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523677/ | NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS APR 8 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 19-50310
Plaintiff-Appellee, D.C. No.
3:18-cr-03066-JLS-1
v.
SHAWN JAMES SOLEIMANI, MEMORANDUM*
Defendant-Appellant.
Appeal from the United States District Court
for the Southern District of California
Janis L. Sammartino, District Judge, Presiding
Submitted April 3, 2020**
Pasadena, California
Before: WARDLAW, MURGUIA, and MILLER, Circuit Judges.
Shawn James Soleimani appeals the district court’s order committing him to
the Attorney General’s custody for competency restoration under 18 U.S.C. §
4241(d). Soleimani argues that the commitment order violates his constitutional
right to equal protection because other defendants on pre-trial release who
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
are not in competency proceedings but who require mental health services are
allowed to obtain those services on an outpatient basis. We have jurisdiction under
the collateral order doctrine, United States v. Friedman, 366 F.3d 975, 980 (9th
Cir. 2004), and we affirm.
“The construction or interpretation of a statute is a question of law that we
review de novo.” United States v. Cabaccang, 332 F.3d 622, 624–25 (9th Cir.
2003) (en banc) (citing United States v. Carranza, 289 F.3d 634, 642 (9th Cir.
2002)). We also review de novo the constitutionality of a statute. United States v.
Vongxay, 594 F.3d 1111, 1114 (9th Cir. 2010).
To succeed on his equal protection claim, Soleimani must first show that the
government treats him differently from similarly situated persons. Pimentel v.
Dreyfus, 670 F.3d 1096, 1106 (9th Cir. 2012) (per curiam); United States v. Lopez-
Flores, 63 F.3d 1468, 1472 (9th Cir. 1995). If this showing is made, we must then
evaluate “under the appropriate level of scrutiny whether the distinction made
between the groups is justified.” Lopez-Flores, 63 F.3d at 1472 (citing Plyler v.
Doe, 457 U.S. 202, 217–18 (1982)).
A defendant who is incompetent to stand trial is not similarly situated to a
competent defendant with mental health issues on pre-trial release. A finding of
incompetency amounts to a legal determination that the defendant “is unable to
understand the nature and consequences of the proceedings against him or to assist
2
properly in his defense,” 18 U.S.C. § 4241(d), such that if trial were to proceed, it
would constitute a violation of due process, Cooper v. Oklahoma, 517 U.S. 348,
354 (1996). Therefore, an incompetent defendant such as Soleimani is not
similarly situated to defendants on pre-trial release whose mental health issues do
not affect competency to stand trial. Because Soleimani has not identified two
similarly situated groups of people, his equal protection claim fails. Pimentel, 670
F.3d at 1106 (noting that a finding that plaintiff was treated differently than
similarly situated individuals is a threshold showing in the equal protection
analysis).
AFFIRMED.
3 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523678/ | NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS APR 8 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
UNITED STATES OF AMERICA, No. 18-50404
Plaintiff-Appellee, D.C. No.
2:05-cr-00578-JFW-37
v.
JOSE LUIS MEJIA, AKA Jose Al Mejia, MEMORANDUM*
AKA Checho, AKA Cheech, AKA Joe,
AKA Juan Martinez, AKA Check Mejia,
AKA Jose Mejia, AKA Jose L. Mejia, AKA
Jose Luiz Mejia, AKA Joe Morin, AKA Jose
Nernedes,
Defendant-Appellant.
Appeal from the United States District Court
for the Central District of California
John F. Walter, District Judge, Presiding
Submitted April 3, 2020**
Pasadena, California
Before: BEA and BADE, Circuit Judges, and DRAIN,*** District Judge.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Gershwin A. Drain, United States District Judge for
the Eastern District of Michigan, sitting by designation.
Jose Luis Mejia was convicted of two drug-trafficking offenses alleged in a
multi-defendant First Superseding Indictment. He was sentenced to 324 months’
imprisonment. Mejia appeals from the district court’s order denying his motion for
a sentence reduction under 18 U.S.C. § 3582(c)(2). We have jurisdiction under
28 U.S.C. § 1291, and we affirm.
In 2007, Mejia appealed his conviction and sentence, which was
consolidated with eight of his co-defendants’ appeals. See United States v. Yepiz,
718 F. App’x 456 (9th Cir. 2017). The prior panel affirmed Mejia’s conviction and
denied his sentencing arguments without prejudice so that he could move in the
district court to modify his sentence pursuant to § 3582(c)(2). Id. at 473.
Following remand, the district court declined to exercise its discretion to grant
Mejia a sentence reduction and accordingly denied his motion.
Mejia argues that he is entitled to a sentence reduction based on the revised
drug-quantity thresholds in the amended Guidelines. We review the denial of a
sentence reduction under § 3582(c)(2) for abuse of discretion. United States v.
Dunn, 728 F.3d 1151, 1155 (9th Cir. 2013). A district court abuses its discretion
when it applies the incorrect legal standard or if “the trial court’s application of the
correct legal standard was (1) illogical, (2) implausible, or (3) without support in
inferences that may be drawn from the facts in the record.” United States v.
Hinkson, 585 F.3d 1247, 1262 (9th Cir. 2009) (en banc) (internal quotation marks
2
omitted).
Contrary to Mejia’s contention, the district court properly followed the
procedure set forth in Dillon v. United States, 560 U.S. 817 (2010), for considering
a motion for sentence reduction under § 3582(c)(2). It determined that it was
“authorized to reduce” Mejia’s sentence under the first step of the Dillon inquiry.
Notably, the district court did not cite to any drug-quantity determination in this
section.
Next, the district court examined the drug quantity at issue in the second step
of the Dillon inquiry. The district court retains discretion in this second step to
decline to reduce a defendant’s sentence “based on the applicable [18 U.S.C.]
§ 3553(a) factors and the circumstances of the case.” United States v. Mercado-
Moreno, 869 F.3d 942, 962 n.12 (9th Cir. 2017). It should not be constrained in its
discretionary judgment at this stage of the inquiry. See United States v. Rodriguez,
921 F.3d 1149, 1153 (9th Cir. 2019) (“[T]he court must consider all applicable
18 U.S.C. § 3553(a) factors and determine whether, in its discretion, ‘the
authorized reduction is warranted, either in whole or in part.’”) (quoting Dillon,
560 U.S. at 826).
Here, the district court did not abuse its discretion when it cited to its prior
findings and references to the trial transcript, exhibits, and portions of the Pre-
Sentencing Report during its consideration of the § 3553(a) factors. At Mejia’s
3
sentencing, the district court determined that the government’s evidence was
“sufficient” to “sustain that all or [a] portion of that cocaine powder was converted
to cocaine base[.]” After referencing several alleged transactions, it ultimately
decided to “err on the side of caution” in its offense-level determination.
“Caution” here resulted in determination of lower drug quantities; thus, in Mejia’s
favor. The district court cited to these same findings in its order denying Mejia’s
motion to support its conclusion that there was “overwhelming evidence” of
Mejia’s drug trafficking which “strongly rebuts any argument” that Mejia deserved
a reduced sentence. Accordingly, the drug-quantity determinations are not
contradictory.
Mejia also argues that the denial of his motion was substantively
unreasonable. We review the substantive reasonableness of a district court’s
sentencing decision for abuse of discretion in light of the totality of the
circumstances. Gall v. United States, 552 U.S. 38, 51 (2007). The fact that this
court might reasonably have concluded that a different sentence was appropriate is
insufficient to justify reversal of the district court’s decision. Id.
Here, the district court determined that the original 324-month sentence
continues to be appropriate. It declined to grant any sentence reduction for three
reasons: (1) the overwhelming evidence of Mejia’s extensive drug trafficking and
the large quantities of cocaine base involved in his criminal conduct; (2) the need
4
for deterrence and to protect the public; and (3) the other factors previously
identified at sentencing, including Mejia’s failure to take responsibility, remained
“unchanged.” These reasons are properly grounded in § 3553(a).
Moreover, the district court specifically addressed the amended Guidelines’
policy considerations of the connection between the quantity of drugs involved in a
crime and its subsequent harmfulness and alleged danger to the community. After
providing a balanced analysis of positive and negative factors, the district court
determined that these policy considerations did not apply to Mejia’s case. The
district court’s explanation was sufficient, see Molina-Martinez v. United States, --
- U.S. ---, 136 S. Ct. 1338, 1348 (2016), and was not an abuse of discretion in light
of the totality of the circumstances, Gall, 552 U.S. at 51.
AFFIRMED.
5 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3397602/ | [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 482
The City of Pensacola, in May, 1932, passed and adopted an ordinance known as Revised Tax Ordinance No. 1, under the terms of which a tax of four per cent. was laid on the purchase of electricity, gas, water and telephone service within the corporate limits of that city, to be calculated upon the gross charges made to consumers for such service and providing a maximum tax of five dollars for each separate service or station and providing that the tax should not extend to telephone service furnished at coin box telephones, and further provided that the dealer should collect the tax from the consumer where not absorbed by the furnisher and imposed a penalty of fine and imprisonment, or both, for violation of the ordinance. It is also provided in the ordinance that the monies derived from the tax shall be used exclusively for the retirement of certain outstanding indebtedness of the City of Pensacola and the interest and when the same is paid that the tax shall then cease.
The appellant, E. T. Heriot, a consumer and taxpayer, sued on behalf of himself and others similarly situated, by bill in the Circuit Court of Escambia County, against the City of Pensacola, George J. Roark as City Manager; Florida Public Utilities Company, a corporation, Gulf Power Company, a corporation, and the Southern Bell Telephone and Telegraph Company, a corporation, sought to restrain the enforcement of the ordinance.
Motion to dismiss the bill was filed by the City of Pensacola and George J. Roark as City Manager; the cause *Page 483
coming on to be heard before the chancellor, the bill was dismissed. It is from this order dismissing the bill that the appeal is taken.
The assignment of error contains but one ground, i. e.: The Court erred in sustaining the motion to dismiss the bill.
The first question we are to determine is whether the City of Pensacola had power, under its charter, to levy a tax upon the purchase of gas, electricity, water and telephone service payable by the consumer. This is clearly an excise tax, as defined in Amos v. Gunn, 84 Fla. 285, 94 So. 615, where it is held:
"An excise tax is one laid on licenses to pursue certain occupation, corporate privileges, or sales or consumption of commodities," and "An excise tax partakes of the nature of a license tax."
The tax here considered is of the same general nature as the gasoline tax now imposed by the State. The authority of the State to impose such a tax is beyond question. Amos v. Gunn,supra, Sheip and Co. v. Amos, 130 So.2d 699, Amos v. Matthews,126 So.2d 308.
Section 8 of Article VIII of the Constitution of Florida provides:
"The Legislature shall have power to establish, and to abolish, municipalities, to provide for their government, to prescribe their jurisdiction and powers, and to alter or amend the same at any time."
Section 5 of Article IX of the Constitution of Florida provides:
"The Legislature shall authorize the several counties and incorporated cities or towns in the State to assess and impose taxes for county and municipal purposes, and for no other purpose; and all property shall be taxed upon the *Page 484
principles established for State taxation. But the cities and incorporated towns shall make their own assessments for municipal purposes upon the property within their limits. The Legislature may also provide for levying a special capitation tax, and a tax on licenses * * *."
Under Section 8 of Article IX, the Legislature may grant to cities any power or authority that does not conflict with other provisions of organic law. City of Lakeland v. Amos,143 So. 744.
In Amos v. Matthews, 99 Fla. 1, 65, 115, 126 So.2d 308, it is said:
"The Legislature may provide for levying excise taxes either by a direct imposition thereof, or by delegated authority to local offices to levy such tax for a local purpose."
There can be no question therefore that the Legislature could delegate to the City of Pensacola the power to levy the tax in question.
There is no inconsistency in this holding and that the Roach v. Ephren, 87 Fla. 523, 90 So.2d 609, where it is held that the Legislature may pass an unreasonable law and the Court will not strike it down unless it violates an organic principle; but the Legislature may not delegate to the City the power to pass an unreasonable ordinance.
We now pass to the question as to whether such power has, in fact, been delegated.
Chapter 15,425, Acts of 1931, is the charter of the City of Pensacola, the purpose of which Act, as expressed in the title, among other things, is "granting powers to said City."
Section 1 of said Chapter provides:
"The City of Pensacola, under this Act, shall have and is hereby granted authority, to exercise all powers relating *Page 485
to the municipal affairs; and no enumeration of powers, in any law, shall be deemed to restrict the general grant of authority, under the general laws of the State, applicable to municipal corporations, hereby conferred.
"The following shall be deemed to be a part of the powers conferred by this Section:
"(1) To levy, assess and collect taxes and to borrow money within the limits prescribed by general law; and to levy and collect special assessments for local improvements."
Section 2 of said Chapter, among other things, provides:
"It is intended that the City of Pensacola shall have, and may exercise all powers which under the Constitution of Florida, it would be competent for this charter to specifically enumerate."
And Section 3 of said Chapter provides:
"All rights, actions, prosecutions and contracts and power and property of every description which were vested in it, are vested in it under the charter herein provided for, as though there had been no change in form of government."
At first glance, it may seem that the phrase "within the limits prescribed by general law," as contained in Subsection 1, is a limitation upon the power to levy, assess and collect taxes as well, as upon the power to borrow money, and such is the contention of appellant.
In construing Statutes, it is a cardinal rule that the intent is the vital part. It is the essence of the law. The primary rule of construction is to ascertain and give effect to that intent.
The entire Statute is to be considered in ascertaining the intent. Effect must be given to every part of the Section *Page 486
and every part of the Statute as a whole. The subject regulated, the purpose designed to be accomplished, and the means adopted should be considered to ascertain the true and lawful legislative intent which alone has the force of law.
Axtell v. Smedley, 59 Fla. 430, 52 So.2d 710; Tylee v. Hyde,60 Fla. 389, 52 So.2d 968; Keefe v. St. Petersburg, 145 So.2d 175.
The Court will not follow the letter of the Statute when it leads away from the true intent and purpose of the Legislature and to conclusions inconsistent with the general purpose of the Act. Curry v. Lehman, 55 Fla. 847, 47 So.2d 18.
"In statutory construction legislative intent is the pole star by which we must be guided, and this intent must be given effect even though it may appear to contradict the strict letter of the statute and well-settled canons of construction. No literal interpretation should be given that leads to an unreasonable or ridiculous conclusion or to a purpose not designed by the law makers." State v. Sullivan, 116 So.2d 255;95 Fla. 191.
Generally, the rule is that statutes conferring authority to impose taxes must be strictly construed.
Moseley v. Tiff, 4 Fla. 402; Ex parte Sims, 25 So.2d 280;40 Fla. 432.
It is also stated in Ex Parte Sims, supra.:
"Another general rule universally recognized is that delegated corporate powers to municipalities, particularly grants of power that are out of the usual range, and that may result in public burdens, or which in their exercise touch the right to liberty or property or any common law right of the citizens must be strictly construed and when in such construction there is any ambiguity or doubt as to *Page 487
the extent of the power it is to be determined in favor of the State or general public, and against the State's grantees."
What the Legislature intended, in Sub-section 1, of Chapter 15425, Acts of 1931, must be determined from the purpose of the Act and the language used. Clearly, the purpose of the Act was to grant, rather than restrict, powers to the City of Pensacola and to vest the City with a charter free from the provisions of the general law. The wording of the Sub-section indicates that the words "within the limits prescribed by general law" apply to the borrowing of money and not to the levying, assessing and collection of taxes. If it had been the intention of the Act to limit also the right to levy, assess and collect taxes, we think that the word "to" before the word "borrow" would not have been inserted. In giving the sentence an ordinary construction, consistent with the natural arrangement of the language used, the quoted phrase "within the limits prescribed by general law" limits the power to borrow money, and has no reference to the power to levy, assess and collect taxes. If the Legislature had intended otherwise, why the word "to" before the word "borrow?" Why did not the sentence read "to levy, assess and collect taxes and borrow money, within the limits prescribed by general law?" The word "to" can have no meaning unless it was to break the continuity of power, and separates the power to levy, assess and collect taxes from the power to borrow money. When we consider this phrase with that contained in Section 2, viz.: "It is intended that the City of Pensacola shall have and may exercise all powers which under the Constitution of Florida it is competent for this charter to specifically enumerate," and with the provision of Section 3 of said Act, wherein all power of the then existing charter is reserved, and Chapter 6087, Acts of 1909, which specifically confers power upon the City, to levy licenses *Page 488
upon privileges, and keeping in mind the purpose of the Act as expressed in the title and drawn from the whole context thereof, to-wit: the granting of power and changing the whole scheme of government far beyond the scope of the general municipal laws. There can be no doubt that the power has been conferred, and the City had power to levy the tax in question.
The tax here imposed is upon the privilege of purchasing the service and commodities set forth in the Ordinance.
Orange State Oil Co. v. Amos, 130 So.2d 707; City of West Palm Beach v. Amos, 130 So.2d 710.
It is next contended by appellant that inasmuch as the maximum of Five Dollars is provided for any one consumer, at any one station, it violates the equal protection clause of the Federal Constitution, in that a consumer using less than one hundred and twenty-five dollars of service must pay a straight four per cent. tax, while one using more than one hundred and twenty-five dollars of service would pay less than four per cent. This is no valid objection to the Ordinance. Jackson v. Neff, 64 Fla. 326; 60 So.2d 360. In that case it was held that a statute imposing a graduating scale of license taxes fixed on automobiles of various horse power, with a maximum tax of one hundred dollars upon automobiles of seventy-one horse power or over, and no additional tax for power over that amount was valid.
The law guarantees to everyone the equal protection of the law, but does not require that the tax of the kind here considered in all instances and under all conditions, should be equal. The taxing authority has wide discretion in imposing license taxes and unless there can be no substantial basis for discrimination and classification and in fixing the amount of licenses so that the discrimination must be regarded as purely arbitrary and unreasonable under every conceivable condition in practical affairs, the Courts will *Page 489
not interfere. Peninsular Gas. Co. v. State, 68 Fla. 411;67 So.2d 165.
Excise taxes are not within the principle of uniformity of rates. Gray v. Central Fla. Lumber Co., 140 So.2d 320.
The fact that the Ordinance provides that the consumer shall pay the tax where not absorbed by the dealer and provides that the dealer shall make all collections is valid.
Texas Co. v. State, 254 P. 1063; 53 A. L. R. 258. Pierce Oil Co. v. Hopkins, 264 U.S. 137; 68 L. E. 593; Standard Oil Co. v. Brodie, 239 S.W. 753.
In actual practice, the consumer is generally required to pay the tax when not specifically provided otherwise. The most common form of an excise tax of this kind is the gasoline tax; generally, and in this State, the tax is paid by the first dealer and ultimately passed on to the consumer. To hold the Ordinance valid if it required the dealer to pay the tax and permitted him to pass it on to the consumer, but void because it required the consumer to pay in the first instance, would be to hold that the taxing authority can do indirectly what it cannot do directly.
The Ordinance is reasonable since the tax is levied upon the consumption of commodities which in their distribution are necessarily transported by wires upon, and pipes under, the public ways of the city. The Court may act upon the reasonableness and legality of the Ordinance, but not its wisdom or folly.
The next attack made upon the Ordinance is that the tax is inoperative and void because the consumer is required to pay, and is a tax upon the right to acquire and hold property given to citizens under Section 1 of the Bill of Rights, which provides that all men have certain inalienable rights, among which are acquiring, possessing and protecting property. This contention must also fail. Section 1 of the Bill of Rights does not mean that men should not contribute *Page 490
to the support of the government under which they live by the payment of taxes upon the property acquired or possessed by them. This is but an attribute to the ownership of property. However, the tax here involved is not a tax upon the right of acquiring or possessing property, but is upon the transaction.
It is apparent that the decree appealed from is correct; it is therefore affirmed.
DAVIS, C. J., and WHITFIELD, TERRELL and BUFORD, J. J., concur. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4554013/ | Case: 19-1931 Document: 58 Page: 1 Filed: 08/07/2020
United States Court of Appeals
for the Federal Circuit
______________________
PARSONS EVERGREENE, LLC,
Appellant
v.
SECRETARY OF THE AIR FORCE,
Cross-Appellant
______________________
2019-1931, 2019-1975
______________________
Appeals from the Armed Services Board of Contract
Appeals in Nos. 58634, 61784, Administrative Judge J.
Reid Prouty, Administrative Judge Craig S. Clarke, Ad-
ministrative Judge Richard Shackleford.
______________________
Decided: August 7, 2020
______________________
CAMERON HAMRICK, Miles & Stockbridge PC, Washing-
ton, DC, argued for appellant. Also represented by
RAYMOND MONROE.
ROBERT R. KIEPURA, Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, argued for cross-appellant. Also represented
by ETHAN P. DAVIS, STEVEN JOHN GILLINGHAM, ROBERT
EDWARD KIRSCHMAN, JR.; LORI R. SHAPIRO, Office of Gen-
eral Counsel, United States General Services Administra-
tion, Washington, DC.
Case: 19-1931 Document: 58 Page: 2 Filed: 08/07/2020
2 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
______________________
Before DYK, CLEVENGER, and HUGHES, Circuit Judges.
DYK, Circuit Judge.
Parsons Evergreene, LLC (“Parsons”) appeals from two
decisions by the Armed Services Board of Contract Appeals
(“Board”). The Board granted in part and denied in part
Parsons’ claims for equitable adjustment on a contract for
the design and construction of two buildings at McGuire
Air Force Base. The government cross-appeals, contending
that the Board lacked jurisdiction; that we lack jurisdiction
in part; and, on the merits, that the Board erroneously re-
quired it to disprove the reasonableness of Parsons’
claimed costs. We affirm in part, reverse in part, dismiss
in part, and remand.
BACKGROUND
On December 12, 2003, the government awarded Par-
sons a $2.1 billion indefinite-delivery, indefinite-quantity
contract (“Contract”) for planning and construction work. 1
The work was to be described in subsequent task orders.
On July 13, 2005, the government issued a $34 million task
order (“Task Order”) under the Contract to complete an ex-
isting, concept-level design and construct two facilities,
known as the Temporary Lodging Facility and the Visiting
Quarters, at the McGuire Air Force Base in New Jersey.
The Temporary Lodging Facility was to be a 50-unit tran-
sitional housing facility for use by military and civilian per-
sonnel. The Visiting Quarters was to be a 175-unit facility
similar to a hotel with individual rooms and private bath-
rooms. Design and construction were completed, and the
1 The contract was originally awarded to Parsons In-
frastructure and Technology Group Inc. The contract was
transferred to Parsons via novation on September 7, 2004.
Case: 19-1931 Document: 58 Page: 3 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 3
U.S. Department of the Air Force (“Air Force”) accepted the
completed facilities for “beneficial use” on September 11,
2008. J.A. 96.
On June 29, 2012, Parsons submitted a claim to the Air
Force seeking approximately $34 million in additional
costs that Parsons allegedly incurred in the design and con-
struction process. The contracting officer issued a final de-
cision on March 27, 2013 almost entirely denying Parsons’
claim, which Parsons appealed to the Board under the Con-
tract Disputes Act (“CDA”). In separate decisions in
ASBCA Nos. 58634 and 61784, the Board denied in part
and sustained in part Parsons’ claim, awarding Parsons
about $10.5 million plus interest.
Parsons appeals. The government cross-appeals, con-
tending that the Board lacked jurisdiction; that we lack ju-
risdiction in ASBCA No. 61784; and that on the merits the
Board erroneously required it to disprove the reasonable-
ness of Parsons’ claimed costs. We review the Board’s legal
conclusions de novo and its factfinding for substantial evi-
dence. 41 U.S.C. § 7107(b).
DISCUSSION
I
At the outset, we must resolve a jurisdictional chal-
lenge. The government contends that the Board lacked
CDA jurisdiction over this case. We disagree.
The CDA provides a process for dispute resolution of
certain contract claims against the government. As rele-
vant here, the CDA applies to contracts “made by an exec-
utive agency” for “the procurement of services” or “the
procurement of construction . . . of real property.” 41
U.S.C. § 7102(a)(1), (3). Claims by contractors are first
submitted to a contracting officer, who issues a decision on
the claim. 41 U.S.C. § 7103(a)(1), (d). The contractor may
appeal the contracting officer’s decision to a Board of
Case: 19-1931 Document: 58 Page: 4 Filed: 08/07/2020
4 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
Contract Appeals. Id. § 7104(a). The Board’s decision may,
in turn, be appealed to this court. Id. § 7107(a)(1).
A
The government first contends that the Board lacked
jurisdiction under the so-called “NAFI doctrine.” The
Board concluded that it had jurisdiction because the NAFI
doctrine had been abrogated by this court’s decision in
Slattery v. United States, 635 F.3d 1298 (Fed. Cir. 2011) (en
banc).
Beginning in the late 1960s, our predecessor court held
in a line of cases that neither the Court of Federal Claims
(“Claims Court”) nor the Boards of Contract Appeals had
jurisdiction over contract disputes with nonappropriated
fund instrumentalities (“NAFIs”). Kyer v. United States,
369 F.2d 714 (Ct. Cl. 1966). “A ‘nonappropriated fund in-
strumentality’ is one which does not receive its monies by
congressional appropriation.” United States v. Hopkins,
427 U.S. 123, 125 n.2 (1976). As relevant to Board juris-
diction, these cases construed the phrase “executive
agency” in the CDA to exclude contracts made by NAFIs.
See, e.g., Furash & Co. v. United States, 252 F.3d 1336,
1343 (Fed. Cir. 2001); Strand Hunt Const., Inc. v. West, 111
F.3d 142 (Fed. Cir. 1997) (unpublished table decision). As
to Claims Court jurisdiction, these cases construe the
Tucker Act’s authorization of suits against “the United
States” to exclude NAFIs. See 28 U.S.C. § 1491(a)(1); Kyer,
369 F.2d at 719 .
In 2011, in our en banc decision in Slattery, we held
that the Claims Court had Tucker Act jurisdiction over a
dispute between a contractor and the Federal Deposit In-
surance Corporation (“FIDC”), even though the FDIC was
a NAFI. 635 F.3d at 1310, 1314. In so holding, we abro-
gated the NAFI doctrine for Tucker Act claims. Id. at 1321.
We have not yet decided whether Slattery also abrogated
the NAFI doctrine for CDA disputes appealed to a Board of
Case: 19-1931 Document: 58 Page: 5 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 5
Contract Appeals. We expressly reserved that the question
in one later case. See Minesen Co. v. McHugh, 671 F.3d
1332, 1337 (Fed. Cir. 2012).
The government asserts that the Board lacked CDA ju-
risdiction under the NAFI doctrine. It points out that the
Board found that the Task Order was made by the Air
Force Services Agency (“AFSVA”), a NAFI. We need not
decide the current status of the NAFI doctrine as applied
to the Boards of Contract Appeals because, even under pre-
Slattery precedent, the dispute here would not be barred.
Contrary to the Board’s finding, the contract is not a NAFI
contract.
The contracting documents show that the Task Order
was made by the Air Force and not by the AFSVA. The
Contract on which the Task Order is based was “Issued By”
the “Air Force Materiel Command” (“AFMC”), a part of the
Air Force that the government admits is not a NAFI, and
was to be “Administered By” the “Department of the Air
Force.” J.A. 733. The request for proposal (“RFP”) that led
to the Task Order uses “Department of the Air Force” let-
terhead and states that “[t]he USAF intends to issue a com-
petitive [Task Order].” J.A. 4823 (emphasis added). The
Task Order, like the Contract, was “Issued By” the “Air
Force Materiel Command” and “Administered By” the “De-
partment of The Air Force.” J.A. 798. The contracting of-
ficer who signed the Task Order was from the AFMC. The
government has not identified any mention of the AFSVA
or any other NAFI in either the Contract or the Task Order.
The contractual terms further support the conclusion
that this was not a NAFI contract. Air Force Manual 64-
302, which “provid[es] guidance and procedures for Air
Force NAF contracting,” states that “when FAR clauses are
used in NAFI contracts, the contracting officer will delete
references to ‘Government’ and substitute ‘NAFI.’” Depart-
ment of the Air Force, Manual 64-302, Nonappropriated
Case: 19-1931 Document: 58 Page: 6 Filed: 08/07/2020
6 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
Fund (NAF) Contracting Procedures, at 1, 15 (Nov. 3,
2000), http://afpubs.hq.af.mil. Yet the Contract includes
many FAR clauses referring to “Government” and no refer-
ences to the contracting entity’s being a “NAFI.”
The government contends that the Task Order is a
NAFI contract because the Air Force did not and could not
have lawfully funded it with appropriations. The govern-
ment points out that the funds used for the Task Order
were “non-appropriated funds.” Cross-Appellant’s Reply 4
(citing J.A. 804). The government contends that “a military
department must make a specific request to Congress for
funding for a specified building project, and Congress must
grant funding authority for that project, in order for a mil-
itary department to be allowed to expend appropriated
funds for a military construction project.” Id. at 11. 2
2 For this proposition, the government relies on 10
U.S.C. § 2802(a), which provides that “the Secretaries of
the military departments may carry out such military con-
struction projects . . . as are authorized by law.” See also
10 U.S.C. § 114(a) (“No funds may be appropriated . . . to
or for the use of any armed force or obligated or expended
for . . . military construction . . . unless funds therefor have
been specifically authorized by law.”); G. James Herrera,
Cong. Rsch. Serv., R44710, Military Construction: Author-
ities, Process, and Frequently Asked Questions 2 (2019)
(“In practical application of [sections 2802 and 114], Con-
gress has required project-by-project authorization and ap-
propriation for military construction projects.”).
The government also cites to the 2005 National De-
fense Authorization Act, Pub. L. 108–375, 118 Stat. 1811,
2108–11 (2004) (“Authorization Act”). The Authorization
Act listed and provided appropriations for construction at
dozens of Air Force bases, but did not authorize construc-
tion at McGuire Air Force Base, where the Visiting
Case: 19-1931 Document: 58 Page: 7 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 7
Congress did not provide the Air Force with the required
authorization here, the government asserts, so the Task
Order must have been a NAFI contract.
Even assuming arguendo that the Air Force could not
have used appropriated funds for the Task Order, the gov-
ernment’s argument fails. The government relies on Hop-
kins and Furash to suggest that a contract paid from
nonappropriated funds is a NAFI contract. Despite some
language in prior cases suggesting that the NAFI exclusion
turns on the “activity” at issue, the exclusion did not de-
pend on whether the contract itself was to be funded with
appropriations. See United States v. Gen. Elec., 727 F.2d
1567, 1570 (Fed. Cir. 1984). Instead, the nature of the con-
tracting entity governed: namely, whether the contract was
“made by” a NAFI. And an agency is only a NAFI where
there is “a clear expression by Congress that it intended to
separate the agency from general federal revenues.”
Furash, 252 F.3d at 1339.
Thus, our predecessor held that a contract made by the
Agency for International Development (“AID”) did not im-
plicate the NAFI doctrine—even though the program im-
plemented by the contract was to be run without
appropriated funds—because AID (as a whole) received ap-
propriated funds. McCarthy v. United States, 670 F.2d 996,
1002 (Ct. Cl. 1982). The court explained that “the nonap-
propriated funds exclusion is limited to instances when, by
law, appropriated funds not only are not used to fund the
agency, but could not be.” Id.; see also L’Enfant Plaza
Props., Inc. v. United States, 668 F.2d 1211, 1212 (Ct. Cl.
1982) (explaining that, to implicate the NAFI doctrine,
“there must be a clear expression by Congress that the
agency was to be separated from general federal
Quarters and Temporary Lodging Facility were built. See
Authorization Act §§ 2301–02.
Case: 19-1931 Document: 58 Page: 8 Filed: 08/07/2020
8 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
revenues”). Here, there is no question that the Air Force
“has authority to use appropriated funds if and to the ex-
tent appropriated, and that is sufficient to avoid the non-
appropriated funds exclusion.” See McCarthy, 670 F.2d at
1002. 3
The Task Order was made by the Air Force, and not the
AFSVA. The NAFI doctrine, even if it survives under the
CDA, is inapplicable.
B
The government argues alternatively that the CDA is
limited to contracts for “the procurement of services” or
“the procurement of construction . . . of real property,” and
the contract here does not qualify. Cross-Appellant’s Br.
29–30 (citing 41 U.S.C. § 7102(a)). The contract here was
for the design and construction of two buildings, the Tem-
porary Lodging Facility and the Visiting Quarters. The
Task Order falls neatly within the CDA’s “procurement”
language.
The government nevertheless contends that this was
not a “procurement,” relying principally on 31 U.S.C.
§ 6303. Section 6303 provides that:
An executive agency shall use a procurement con-
tract . . . when—(1) the principal purpose of the in-
strument is to acquire . . . property or services for
the direct benefit or use of the United States Gov-
ernment; or (2) the agency decides in a specific
3 Our decision in General Electric supports this con-
clusion. There, as here, the fact that the governmental
counterparty to the contract was the Air Force was suffi-
cient to place the dispute outside the NAFI doctrine. 727
F.2d at 1570.
Case: 19-1931 Document: 58 Page: 9 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 9
instance that the use of a procurement contract is
appropriate.
The government asserts that the buildings at issue here
were built for the purpose of “support[ing] the morale, wel-
fare, and recreation of the service member[s] or other
guests,” which the government contends is “a distinct pur-
pose from that of the Air Force, whose primary function is
national defense.” Cross-Appellant’s Br. 36. Thus, to the
government, the Task Order is not “for the direct benefit or
use of the United States Government,” under the meaning
of 31 U.S.C. § 6303.
The government’s argument lacks merit. Section 6303
is not part of a statutory definition of CDA jurisdiction. It
is in a separate title of the United States Code. It does not
control the interpretation of the term “procurement” as
used in the CDA. In any event, the government’s position
that a project supporting the morale and welfare of service-
members is not for the “direct benefit” of the government is
at odds with the Supreme Court’s holding in Standard Oil
Co. of California v. Johnson, 316 U.S. 481 (1942), which
held that military post exchanges were “essential for the
performance of governmental functions.” Id. at 485. The
government’s position is also inconsistent with the Secre-
tary of the Air Force’s responsibility for “the morale and
welfare of [Air Force] personnel.” 10 U.S.C. § 9013(b)(9).
Finally, section 6303 does not require that procurement
contracts be for the “direct benefit or use” of the govern-
ment. It states that agencies “shall use” procurement con-
tracts in certain circumstances, but does not otherwise
foreclose their use. Section 6303 contemplates procure-
ment contracts even when not for the government’s direct
benefit so long as “the agency decides” that a procurement
contract “is appropriate.” The Task Order is a “procure-
ment” contract under the CDA.
Case: 19-1931 Document: 58 Page: 10 Filed: 08/07/2020
10 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
The government’s reliance on G.E. Boggs & Assocs.,
Inc. v. Roskens, 969 F.2d 1023 (Fed. Cir. 1992), and New
Era Construction v. United States, 890 F.2d 1152 (Fed Cir.
1989), is similarly unavailing. In each of those cases, we
held the contractual dispute to be not subject to the CDA.
But G.E. Boggs and New Era, unlike this case, involved
contracts with entities—the Syrian Arab Republic and the
Sac and Fox Tribe of Missouri, respectively—that were not
executive agencies. G.E. Boggs, 969 F.2d at 1024; New Era,
890 F.2d at 1153.
We conclude that the Board had CDA jurisdiction.
II
We next consider the timeliness of Parsons’ appeal
from ASBCA No. 61784 as it relates to our own jurisdiction.
Parsons contends that the Board erred in denying recovery
for costs Parsons allegedly incurred as a result of delays
caused by a payroll review by the Air Force to determine
Parson’s compliance with the Davis-Bacon Act. The Act re-
quires federal construction contractors to pay laborers and
mechanics at least the prevailing wage for their work. 40
U.S.C. § 3142(a). Under FAR § 22.406–8, the government
was authorized to ensure Davis-Bacon Act compliance by
“[c]onduct[ing] labor standards investigations when avail-
able information indicates such action is warranted.” Par-
sons asserts that it is entitled to compensation because the
Air Force unreasonably delayed initiating and conducting
such a review. We do not reach the merits of Parsons’ pay-
roll claim because we lack jurisdiction to consider it.
The procedural history of Parsons’ payroll claim is as
follows. On June 29, 2012, Parsons submitted the claims
at issue here to the contracting officer, including its payroll
claim. The contracting officer denied recovery and, on
April 22, 2013, Parsons appealed to the Board. Parsons’
appeal was initially docketed as ASBCA No. 58634. Liti-
gation continued and, on September 5, 2018, the Board
Case: 19-1931 Document: 58 Page: 11 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 11
issued its decisions on the merits of Parsons’ claims, includ-
ing the payroll claim. For all claims except the payroll
claim, the Board issued its decision in the original case,
ASBCA No. 58634. For the payroll claim, “[f]or reasons of
judicial efficiency and clarity,” the Board issued a separate
opinion under a new appeal number, ASBCA No. 61784.
J.A. 1 n.1. Parsons received the Board’s decisions on Sep-
tember 10, 2018. On October 10, 2018, Parsons moved for
reconsideration of the Board’s decision on several claims in
ASBCA No. 58634. Parsons did not seek reconsideration of
the payroll claim in ASBCA No. 61784. The Board issued
its decision denying Parsons’ reconsideration request in
ASBCA No. 58634 on January 23, 2019, which Parsons re-
ceived on January 28, 2019. Parsons appealed the Board’s
decisions on its claims, including the payroll claim, to this
court on May 23, 2019.
Parsons’ appeal of its payroll claim was not timely filed.
The statute governing appeals from the Board to this court
provides that “a contractor may appeal the decision [of an
agency board] within 120 days from the date the contractor
receives a copy of the decision.” 41 U.S.C. § 7107(a)(1)(A).
The 120-day appeal period runs from contractor’s receipt of
the Board’s decision on reconsideration, if reconsideration
is sought. Although Parsons sought reconsideration of the
Board’s decision in ASBCA No. 58634 (and its appeal in
that case is timely), Parsons did not seek reconsideration
in ASBCA No. 61784. Parsons’ appeal in ASBCA No. 61784
was filed 255 days after it received a copy of the final deci-
sion in that action. The 120-day deadline was not tolled by
the request for reconsideration in ASBCA No. 58634.
Therefore, we lack jurisdiction to review the Board’s deci-
sion in ASBCA No. 61784. See Placeway Const. Corp. v.
United States, 713 F.2d 726, 728 (Fed. Cir. 1983) (dismiss-
ing for lack of jurisdiction an appeal from the Board filed
after the 120-day deadline).
We dismiss Parsons’ appeal as to its payroll claim.
Case: 19-1931 Document: 58 Page: 12 Filed: 08/07/2020
12 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
III
We turn to the merits of Parsons’ appeal in ASBCA No.
58634. Parsons argues that the Board erred in denying re-
covery on Parsons’ claim that it was not required to apply
wall coatings from Duroplex-Triarch Industries and Plex-
ture-Triarch Industries (collectively, “Triarch”) to the Vis-
iting Quarters. Triarch is not “paint” in the conventional
sense, though it is a paint-like substance.
The Board rejected Parsons’ theory that it was required
to apply Sherwin-Williams instead of Triarch, holding that
Parsons was required to apply Triarch. The Board found
dispositive the terms of Request for Proposal No. FA8903-
05-R-8234 (“RFP”), on which the Task Order was based.
The RFP “required ‘Duroplex – Triarch Industries’ and
‘Plexture – Triarch Industries’ for interior paints.”
J.A. 132 (quoting RFP § 09911). Parsons does not now
challenge the determination that it was required to apply
Triarch.
The Board, however, introduced a new theory of liabil-
ity, finding the government liable for Parsons’ costs in ap-
plying Sherwin Williams paint due to the Air Force’s
“indecision on what wall coating it wanted, causing [Par-
sons] to start applying Sherwin Williams paint in the [Vis-
iting Quarters].” J.A. 132. But because Parsons did not
argue this theory before the Board and did not quantify its
cost in using Sherwin Williams, the Board denied Parsons
recovery. On appeal, Parsons argues that the Board erred
in denying Parsons recovery under the Board’s theory. We
disagree.
A required element of a claim for equitable adjustment
is proof of damages. The contractor has the “obligation . . .
to provide a basis for making a reasonably correct approx-
imation of the damages” for which the government is liable.
Wunderlich Contracting Co. v. United States, 351 F.2d 956,
969 (Ct. Cl. 1965). It was Parsons’ burden to prove its
Case: 19-1931 Document: 58 Page: 13 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 13
damages, i.e., the costs incurred in applying Sherwin Wil-
liams paint. The Board did not err in concluding that Par-
sons did not meet its burden.
Parsons contends that the record at the time of the
Board decision included sufficient evidence to calculate
Parsons’ cost in using Sherwin Williams. But Parsons
failed to include an alternative argument concerning the
Air Force’s erroneous direction to apply Sherwin Williams
in the Visiting Quarters, and did not identify its costs in
doing so. Nothing in Southwest Electronics & Manufactur-
ing Corporation v. United States, 655 F.2d 1078 (Ct. Cl.
1981), or any other authority cited by Parsons suggests
that the Board was required to scour the tens of thousands
of pages of record evidence in this case, without any guid-
ance, to determine the amount of an award. 4
Parsons also asserts that the Board erred by failing “to
seek the parties’ input as to whether the record supported
recovery under the Board’s new theory prior to deciding the
issue.” Appellant’s Br. 34. “The [Administrative Procedure
Act] does not require the Board to alert a [claimant] that it
may find the asserted theory,” or any other theory that the
4 In Southwest Electronics, the Board overturned the
contracting officer’s award, on the basis that the contractor
did not establish the exact amount of its damages. 655
F.2d at 1088. In reinstating the contracting officer’s
award, our predecessor reasoned that the contractor “[did]
supply some evidence of the damages for which [the gov-
ernment] is liable, and the contracting officer’s award is a
reasonable approximation of the damages which [the con-
tractor] has proven.” Id. Here, by contrast, there is noth-
ing to indicate that the contracting officer awarded Parsons
the cost of using Sherwin Williams, nor did Parsons pro-
vide the Board with evidence from which “a reasonable ap-
proximation” of that cost could be determined. See id.
Case: 19-1931 Document: 58 Page: 14 Filed: 08/07/2020
14 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
claimant could have argued, “lacking in evidence before it
actually does so in [an opinion]. Nor is a [claimant] entitled
to a pre-decision opportunity to disagree with the Board’s
assessment of its arguments.” Fanduel, Inc. v. Interactive
Games LLC, No. 2019-1393, 2020 WL 4342681 (Fed. Cir.
July 29, 2020). While Parsons directed the Board to this
evidence on reconsideration, this was simply too late. See
Exxon Shipping Co. v. Baker, 554 U.S. 471, 485 n.5 (2008)
(a motion for reconsideration “may not be used to . . . pre-
sent evidence that could have been raised prior to the entry
of judgment”).
IV
We next turn to Parsons’ contention that the Board
erred in denying Parsons recovery for the added cost of us-
ing the “Baker design” rather than the “structural-brick”
design for the Visiting Quarters.
The Board held that under the contract Parsons was
entitled to use a structural-brick design to construct the
Visiting Quarters. The Board also found that the govern-
ment improperly denied Parsons the use of the structural
brick design, and instead required Parsons to use what was
called the “Baker design.” The structural-brick design
used a single wall made of closure face brick. The Baker
design used two walls: a first wall of concrete masonry
units and a second wall of brick veneer. After the award,
the government directed Parsons to use the Baker design
and to modify the original Baker design to address prob-
lems of progressive collapse, 5 a design choice that made
construction more expensive.
5 Progressive collapse is a phenomenon that occurs
when certain structural members of a building are dam-
aged and weight is transferred to other members that
Case: 19-1931 Document: 58 Page: 15 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 15
Parsons sought an equitable adjustment for the in-
creased design and construction costs of the Baker design
over that of the structural-brick design. The Board
awarded Parsons a lesser amount for added construction
costs: “the additional cost . . . required to make the
Baker . . . design resist progressive collapse.” J.A. 120–21.
The Board awarded Parsons $722,176 in design costs.
The Board erred in not also awarding the full amount
of Parsons’ additional construction costs for using the
Baker design over the structural-brick design. The amount
of an award for an equitable adjustment is “the difference
between the reasonable cost of performing without the
change . . . and the reasonable cost of performing with the
change.” Morrison Knudsen Corp. v. Fireman's Fund Ins.
Co., 175 F.3d 1221, 1244 (10th Cir. 1999) (quoting Celesco
Indus., Inc., ASBCA No. 22251, 79–1 B.C.A. (CCH) ¶
13,604, at 66,683 (1978)). Here, the “cost of performing
without the change” is the cost of construction using struc-
tural brick. The “cost of performing with the change” is the
actual cost of construction (i.e., the cost of using the modi-
fied double-wall design). Parsons was entitled to the dif-
ference between these two amounts.
We reverse the Board’s denial of recovery to Parsons
for its claim to construction costs. On remand, the Board
must award Parsons the difference between its cost in con-
structing the Baker design compared to the cost Parsons
would have incurred in constructing the structural brick
design.
V
We turn finally to the government’s cross-appeal chal-
lenging the Board’s reasonable-costs analysis.
cannot handle the additional weight. As a result, the build-
ing collapses.
Case: 19-1931 Document: 58 Page: 16 Filed: 08/07/2020
16 PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE
The government contends that the Board erroneously
shifted the burden as to reasonableness to the government,
when the burden should have been on Parsons to prove rea-
sonableness. The government points to Judge Clarke’s
opinion for the Board, which concluded that Parsons’ costs
were reasonable in part because the Air Force’s did not pro-
vide “specific, individualized challenges to each of Parsons’
claimed costs.” Cross-Appellant’s Br. 38. The government
contends that this improperly saddled the government
with the burden of proof. But Administrative Judge
Clarke’s analysis on this issue was expressly disclaimed by
the other two panel judges in a concurring opinion written
by Administrative Judge Shackleford and joined by Admin-
istrative Judge Prouty. Thus, Judge Shackleford’s opinion,
not Judge Clarke’s opinion, is the Board’s controlling opin-
ion on the reasonable-costs issue.
The government does not contend that Judge Shackle-
ford’s opinion commits the same purported burden-shifting
error as Judge Clarke’s opinion. Instead, the government
asserts that Judge Shackleford’s opinion is “so devoid of
any analysis that it cannot be plausibly reviewed for legal
sufficiency on appeal.” Cross-Appellant’s Br. 44. We disa-
gree. Judge Shackleford clearly stated the governing law
and its application to this case. The government has not
shown error in the Board’s reasonable-costs analysis.
The government’s challenge also fails because it has ar-
ticulated no prejudice resulting from of the Board’s pur-
ported error. “[T]he party that ‘seeks to have a judgment
set aside because of an erroneous ruling carries the burden
of showing that prejudice resulted.’” Shinseki v. Sanders,
556 U.S. 396, 409 (2009) (quoting Palmer v. Hoffman, 318
U.S. 109, 116 (1943)); see also SolarWorld Ams., Inc v.
United States, No. 2019-1591, 2020 WL 3443470, at *4–*5
(Fed. Cir. June 24, 2020) (rejecting an appellant’s challenge
to a purportedly unlawful agency action because the appel-
lant did not establish that the action was prejudicial).
Case: 19-1931 Document: 58 Page: 17 Filed: 08/07/2020
PARSONS EVERGREENE, LLC v. SECRETARY OF THE AIR FORCE 17
Here, the government has not explained which, if any, of
the costs awarded to Parsons would have been affected by
the Board’s purported error or how they would have been
affected. We conclude that the Board’s purported errors, if
any, were harmless.
We affirm the Board’s conclusion that Parsons’ costs
awarded by the Board were reasonable.
CONCLUSION
We conclude that the Board had CDA jurisdiction over
ASBCA No. 58634. We dismiss Parsons’ appeal as to its
claim for costs associated with its payroll review (ASBCA
No. 61784) as untimely. We affirm the Board’s decision de-
clining to award Parsons its costs in using Triarch wall
coatings. We reverse the Board’s decision declining to
award Parsons its full costs in constructing the Baker de-
sign over the costs of the structural-brick design. We af-
firm the Board’s conclusion that Parsons’ claimed costs
were reasonable. We remand for further proceedings con-
sistent with this opinion.
AFFIRMED IN PART, REVERSED IN PART,
DISMISSED IN PART, AND REMANDED
COSTS
No costs. | 01-03-2023 | 08-07-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4554014/ | Case: 20-1344 Document: 36 Page: 1 Filed: 08/07/2020
NOTE: This disposition is nonprecedential.
United States Court of Appeals
for the Federal Circuit
______________________
DAVID C. FREELAND,
Petitioner
v.
DEPARTMENT OF HOMELAND SECURITY,
Respondent
______________________
2020-1344
______________________
Petition for review of the Merit Systems Protection
Board in No. CH-0752-18-0077-I-2.
______________________
Decided: August 7, 2020
______________________
DAVID C. FREELAND, Belle Plaine, MN, pro se.
JIMMY MCBIRNEY, Commercial Litigation Branch, Civil
Division, United States Department of Justice, Washing-
ton, DC, for respondent. Also represented by ETHAN P.
DAVIS, ROBERT EDWARD KIRSCHMAN, JR., PATRICIA M.
MCCARTHY.
______________________
Before LOURIE, O’MALLEY, and CHEN, Circuit Judges.
Case: 20-1344 Document: 36 Page: 2 Filed: 08/07/2020
2 FREELAND v. DHS
PER CURIAM.
Pro se appellant David Freeland appeals from a deci-
sion of the Merit Systems Protection Board (Board) affirm-
ing the Department of Homeland Security’s (DHS or
Agency) decision to remove Mr. Freeland from his position
for lack of candor. For the reasons set forth below, we af-
firm.
BACKGROUND
Mr. Freeland formerly worked for DHS as a supervi-
sory human resource specialist in the Recruitment and
Placement Branch of a DHS Human Resources Operations
Center (HROC). Mr. Freeland was conditionally appointed
to this position on September 20, 2015. His appointment
was subject to the completion of a background investiga-
tion conducted by the Office of Personnel Management
(OPM).
Prior to his appointment with DHS, Mr. Freeland was
a supervisory human resources specialist with the Army
Civilian Human Resources Agency (ACHRA). He resigned
in May 2015, after he had been issued a proposed 14-day
suspension for negligent performance of duties. Addition-
ally, at the time of his resignation, he was the subject of a
workplace sexual harassment investigation.
After Mr. Freeland received a tentative offer from
DHS, he was required to complete an employment back-
ground questionnaire for a position of public trust, known
as an SF-85P. Question 12 of the SF-85P asks:
Has any of the following happened to you in the last
7 years?
1 – Fired from a job.
2 – Quit a job after being told you’d be fired.
3 – Left a job by mutual agreement following
allegations of misconduct.
4 – Left a job by mutual agreement following
allegations of unsatisfactory performance.
Case: 20-1344 Document: 36 Page: 3 Filed: 08/07/2020
FREELAND v. DHS 3
5 – Left a job for other reasons under unfavor-
able circumstances
Appellant’s First S.A. F-2. 1 Mr. Freeland completed and
signed his SF-85P form on two occasions, once on July 18,
2015, and again on September 23, 2015. In both instances,
Mr. Freeland answered “no” to Question 12, without
providing any further details in the corresponding com-
ments section. Id. at F-1–F-2.
On January 26, 2016, in the course of the background
investigation, an OPM investigator interviewed Mr. Free-
land after obtaining additional information regarding Mr.
Freeland’s separation from ACHRA. During this inter-
view, Mr. Freeland initially denied any issues with ACHRA
until being confronted by the interviewer directly that
ACHRA had proposed a disciplinary action against him.
Mr. Freeland also initially denied the sexual harassment
allegation until he was directly confronted by the inter-
viewer with the allegation. After completing the investiga-
tion, OPM issued its findings to the Agency’s Office of
Security and Integrity, Investigations Division (OSI). OSI
reviewed OPM’s investigation, which reflected the discrep-
ancies that OPM had uncovered in Mr. Freeland’s SF-85P
responses and that OPM had rated such an issue a D-issue,
indicating that a significant impediment existed for obtain-
ing background clearance. On August 18, 2016, OSI sent
its review and excerpts from the OPM background investi-
gation to the Chief of the HROC.
On August 18, 2017, DHS issued a proposed notice of
removal based on lack of candor, which was supported by
1 “Appellant’s First S.A.” refers to the initial appen-
dix submitted by the Appellant, “Appellant’s Second S.A.”
refers to the appendix attached to the Appellant’s reply
brief, and “Appellee’s S.A.” refers to the appendix attached
to the Appellee’s response.
Case: 20-1344 Document: 36 Page: 4 Filed: 08/07/2020
4 FREELAND v. DHS
three specifications. Two of the specifications were based
upon Mr. Freeland’s response to Question 12 on the two
SF-85P forms he completed in July and September of 2015.
The third specification was based on the follow-up inter-
view in which Mr. Freeland initially denied having any
problems or issues in his prior employment with ACHRA.
On September 8, 2017, Mr. Freeland provided an oral reply
and written response along with supporting documentation
to the deciding official. On November 9, 2017, the deciding
official issued a decision letter sustaining the charge and
supporting specifications, noting that Mr. Freeland’s mis-
conduct cast significant doubt regarding his ability to up-
hold the Agency’s mission in an honest manner. Mr.
Freeland’s removal became effective November 13, 2017.
On November 20, 2017, Mr. Freeland appealed his re-
moval. After a hearing, on October 9, 2019, the adminis-
trative judge affirmed the DHS’s decision to remove Mr.
Freeland. In sustaining the charge, the administrative
judge found that the Agency had established by preponder-
ant evidence that Mr. Freeland had engaged in the charged
conduct of lack of candor—based on the totality of the cir-
cumstances, Mr. Freeland “could not reasonably have be-
lieved” the circumstances surrounding his resignation from
ACHRA were not unfavorable. The administrative judge’s
decision became the final decision of the Board on Novem-
ber 13, 2019. Mr. Freeland timely appealed to this court.
We have jurisdiction under 28 U.S.C. § 1295(a)(9).
DISCUSSION
Our review is limited and requires this court to affirm
a decision of the Board unless it is “(1) arbitrary, capri-
cious, an abuse of discretion, or otherwise not in accordance
with the law; (2) obtained without procedures required by
law, rule, or regulation having been followed; or (3) unsup-
ported by substantial evidence.” 5 U.S.C. § 7703(c). Sub-
stantial evidence is “relevant evidence” that “a reasonable
mind might accept as adequate to support a conclusion.”
Case: 20-1344 Document: 36 Page: 5 Filed: 08/07/2020
FREELAND v. DHS 5
Simpson v. Office of Pers. Mgmt., 347 F.3d 1361, 1364 (Fed.
Cir. 2003) (internal citation omitted).
The requirements for sustaining a charge for lack of
candor include: (1) that the employee gave incorrect or in-
complete information and (2) that he did so knowingly.
Ludlum v. Dep’t of Justice, 278 F.3d 1280, 1284 (Fed. Cir.
2002). “Lack of candor . . . is a . . . flexible concept whose
contours and elements depend upon the particular context
and conduct involved. It may involve a failure to disclose
something that, in the circumstances, should have been
disclosed in order to make the given statement accurate
and complete.” Id. In this case, substantial evidence sup-
ports the Board’s lack of candor finding. Mr. Freeland
makes a number of arguments regarding the Board’s deci-
sion. For the reasons that follow, we do not find that any
of these arguments justify reversing the Board’s decision.
First, Mr. Freeland argues that the Board failed to con-
sider the reasons that OPM decided to close Mr. Freeland’s
background investigation. We disagree. The Board cred-
ited uncontroverted “agency testimony that per policy,
OPM referred the matter back to the agency to take further
action in its discretion based on the appellant’s conditional
appointment and pending EEO activity.” Appellant’s First
S.A. H-17. In the instant case, we see no reason to overturn
the Board’s determination.
Next, Mr. Freeland notes that he had a pending EEO
case against the Department of the Army (Army) and that
his SF-50 from the Army states simply that he resigned
without referencing any pending discipline or investiga-
tions. The SF-50 states that he “gave no reason for resig-
nation.” Appellant’s S.A. 15. “[T]he SF-50 is not a legally
operative document controlling on its face an employee’s
status. . . .” Grigsby v. Dept. of Commerce, 729 F.2d 772,
775–76 (Fed. Cir. 1984). While it is true that the SF-50
does not state that Mr. Freeland resigned due to pending
discipline or investigation, this lack of information does not
Case: 20-1344 Document: 36 Page: 6 Filed: 08/07/2020
6 FREELAND v. DHS
mean that Mr. Freeland did not resign under such unfavor-
able circumstances. We note that Mr. Freeland claims that
he was resigning due to emotional duress and that he had
secured a new position. Appellant’s First S.A. E-1–E-2.
This similarly does not indicate an absence of pending dis-
cipline or investigation.
Mr. Freeland also argues that he had finished his con-
ditional period at DHS and therefore OPM’s note that Mr.
Freeland’s appointment was conditional was in error. Mr.
Freeland appears to conflate a Federal employee’s proba-
tionary period with an employment subject to a back-
ground investigation. Mr. Freeland had finished his one
year probationary period with DHS. 5 C.F.R. § 315.801
(“The first year of service of an employee who is given a
career or career-conditional appointment under this part is
a probationary period . . . .”). Because he was no longer a
probationary employee, Mr. Freeland could appeal the
Agency’s removal decision to the Board. See Mastriano v.
F.A.A., F.2d 1152, 1155 (Fed. Cir. 1983) (stating that the
only cognizable right of appeal by a probationary employee
to the Board is limited to allegations where the Agency ac-
tion resulted from discrimination based upon marital sta-
tus or partisan political reasons). Although no longer a
probationary employee, Mr. Freeland’s employment was
still subject to a background investigation. Mr. Freeland
acknowledged as much during the hearing before the ad-
ministrative judge. Appellee’s S.A. 31–32.
Mr. Freeland argues that the Board failed to
acknowledge that the Agency, in its Removal Notice, ac-
cused Mr. Freeland of intentionality. As noted in the
Board’s decision, a lack of candor does not require “inten-
tionality or an intent to deceive.” Ludlum, 278 F.3d at
1284–85 (stating that lack of candor involves “a failure to
disclose something that, in the circumstances, should have
been disclosed to make the statement accurate and com-
plete”). The Board’s finding that Mr. Freeland’s failure to
disclose the unfavorable circumstances regarding his prior
Case: 20-1344 Document: 36 Page: 7 Filed: 08/07/2020
FREELAND v. DHS 7
employment was enough to support the charge of lack of
candor is supported by substantial evidence, regardless of
any “intentionality.” To the extent Mr. Freeland is arguing
that the deciding official failed to analyze the first Douglas
factor, “the nature and seriousness of the offense, and its
relation to the employee’s duties, position, and responsibil-
ities, including whether the offense was intentional or tech-
nical or inadvertent, or was committed maliciously or for
gain or was frequently repeated,” we find the Board’s de-
termination that the deciding official did consider such a
factor supported by substantial evidence. 2 See Douglas v.
Veterans Admin., 5 M.S.P.R. 280, 305–06 (1981). The rec-
ord contains the deciding official’s analysis of each Douglas
factor and the Board heard testimony from the deciding of-
ficial and credited such testimony. Appellant’s First S.A.
C-1, H-14.
Mr. Freeland also contends that his incorrect answer
on the SF-85Ps was not done for “personal gain.” [BB4-5].
However, a finding of lack of candor does not require a find-
ing of personal gain. Additionally, although the Board
states that a finding of personal gain would be a “common-
sense inference,” it notes that the charge was not based on
a finding of personal gain. Appellant’s First S.A. H-18.
One of the Douglas factors is personal gain. To the extent
Mr. Freeland is arguing the deciding official inappropri-
ately found personal gain in deciding the penalty, we find
the Board appropriately weighed the testimony from the
deciding official and Mr. Freeland. We see no reason to
overturn the Board’s credibility determination.
Mr. Freeland contends that the Labor and Employee
Relations Specialist assigned to Mr. Freeland to coordinate
2 The Douglas factors are used by the deciding offi-
cial to determine whether the consequences of the charge
proposed by the Agency are appropriate. See Douglas, 5
M.S.P.R. at 305–06.
Case: 20-1344 Document: 36 Page: 8 Filed: 08/07/2020
8 FREELAND v. DHS
questions and information interfered with and obstructed
Mr. Freeland’s due process rights during the reply period
by impeding Mr. Freeland’s ability to obtain affidavits.
The Agency argues that Mr. Freeland fails to explain how
having a single person coordinate information and ques-
tions prejudices him. When an agency proposes to take an
adverse personnel action against one of its employees, it
generally must comply with certain procedural require-
ments. See 5 U.S.C. § 7513; Rhodes v. Merit Sys. Prot. Bd.,
487 F.3d 1377, 1380 (Fed. Cir. 2007). Mr. Freeland fails to
provide any details as to how a single point of contact im-
peded or hampered his ability to contest the proposed ac-
tion. Therefore, we find that Mr. Freeland fails to
sufficiently allege that his due process rights were violated.
Mr. Freeland further argues that the Board disre-
garded that he did not take his ethics training until after
the dates on which he completed iterations of the SF-85P—
therefore, he was not on notice that he had to be forthcom-
ing on his SF-85P form. Contrary to Mr. Freeland’s argu-
ment, the Board’s decision acknowledges that this training
occurred after Mr. Freeland completed the SF-85P form.
Appellant’s First S.A. at H-20. But the Board nonetheless
reasonably found that Mr. Freeland knew he had to be
truthful and complete on the SF-85P form based on his tes-
timony. Additionally, the form itself specifically required
Mr. Freeland to certify that his responses were “true, com-
plete and correct.” Therefore, we find that because Mr.
Freeland acknowledged at the hearing that he was aware
he had to provide truthful and complete answers and the
actual form required him to certify as such, the Board’s de-
termination is supported by substantial evidence.
Mr. Freeland further contends that the Board disre-
garded several facts related to the background investiga-
tion: (1) the information provided by OPM was highly
redacted; (2) the unsworn statements provided by Mr.
Freeland’s previous supervisors contained false allega-
tions; and (3) the statements by the OPM investigator
Case: 20-1344 Document: 36 Page: 9 Filed: 08/07/2020
FREELAND v. DHS 9
contained false allegations. “Procedural matters relative
to discovery and evidentiary issues fall within the sound
discretion of the board and its officials.” Curtin v. Office of
Pers. Mgmt., 846 F.3d 1373, 1378 (Fed. Cir. 1988). “If an
abuse of discretion did occur with respect to the discovery
and evidentiary rulings, in order for petitioner to prevail
on these issues he must prove that the error caused him
substantial harm or prejudice to his rights which could
have affected the outcome of the case.” Id. at 1379. First,
Mr. Freeland has failed to sufficiently allege what redacted
information would have resulted in substantial harm or
prejudice. With respect to the statements by Mr. Free-
land’s previous supervisors and OPM that are allegedly
false, we find that Mr. Freeland had multiple opportunities
to argue that such statements were false; however, he
failed to do so successfully. That the Board did not find
such statements to be false does not mean that Mr. Free-
land was substantially harmed or prejudiced or that the
Board abused its discretion. Therefore, we conclude no
abuse of discretion occurred in this instance.
Mr. Freeland argues that the Board disregarded addi-
tional charges brought by the Agency against Mr. Free-
land—charges he had no opportunity to respond to. He
specifically argues that he was charged with material fal-
sification in addition to lack of candor. The Agency argues
that Mr. Freeland was only charged with lack of candor,
not falsification or some other charge. Upon review of the
record, there do not appear to be any additional charges
besides lack of candor. On August 7, 2017, Mr. Freeland
received a letter from DHS informing him of the proposal
of removal based on a single charge, “lack of candor.” Ap-
pellant’s First S.A. F-1. This single charge was reiterated
in a letter to Mr. Freeland from DHS on November 9, 2017.
Id. at S.A. C-1. We therefore find that Mr. Freeland was
only charged with a single charge—lack of candor—and
had an opportunity to respond to this single charge.
Case: 20-1344 Document: 36 Page: 10 Filed: 08/07/2020
10 FREELAND v. DHS
Next, Mr. Freeland argues that the Board erred in de-
termining that his testimony lacked credibility. Along a
similar vein, Mr. Freeland argues that the Board failed to
acknowledge that the deciding official was impeached
throughout the hearing. Both of these arguments concern
the Board’s crediting of witness testimony. As discussed
supra, the standard for overturning the Board’s credibility
determinations is very high. Hanratty, 819 F.2d at 288. In
this case we find that Mr. Freeland’s attacks on the Board’s
credibility findings fall well short of satisfying that stand-
ard.
Additionally, Mr. Freeland argues that the Board used
the incorrect law and lists a number of cases the Board
should have used in its decision. With respect to the ma-
jority of the cases cited, the cases are not relevant because,
as we stated above, Mr. Freeland was charged only with
lack of candor and not falsification. Mr. Freeland indicates
that the Board did not consider Douglas; however, a review
of the Board’s decision indicates that the Board analyzed
whether the deciding official appropriately considered the
Douglas factors. Appellant’s First S.A. H-13; see also Doug-
las, 5 M.S.P.R. at 305–06. The final case, Payton v. Dep’t
of Veterans Affairs, is distinguishable from our case be-
cause in Payton the Board found a due process violation
because the deciding official relied on aggravating factors
not present in the proposed notice of removal. Dkt. No. AT-
0752-14-0055-I-1 (MSPB Jan. 29, 2015). Mr. Freeland does
not appear to be alleging the existence of such a due process
violation. We also find that the proposed notice of removal
in the instant case put Mr. Freeland on notice of potential
aggravating factors. For example, the proposed notice of
removal states “you were aware that the prior Proposed
Discipline and sexual harassment investigation [], would
interfere with your recruitment and placement into the su-
pervisory position that you currently hold. Appellant’s
First S.A. F-5.
Case: 20-1344 Document: 36 Page: 11 Filed: 08/07/2020
FREELAND v. DHS 11
Finally, Mr. Freeland argues that the Board failed to
account for factual differences between case law on which
it relied and his case. We disagree. The Board’s conclusion
here is consistent with both Schuster v. Office of Pers.
Mgmt., 268 F. App’x 972 (Fed. Cir. 2008), and Johnson v.
Office of Pers. Mgmt., 257 F. App’x 314 (Fed. Cir. 2007). In
Schuster, we found that substantial evidence supported the
Board’s determination that the employee, Mr. Shuster,
made a material, false statement on his SF-85P when ap-
plying for federal employment and was subsequently re-
moved from his position with the agency. Schuster, 268 F.
App’x at 974. When applying to the agency, Mr. Schuster
denied having ever left a job under unfavorable circum-
stances, when in fact, he had resigned from a prior em-
ployer while being investigated for bringing a firearm to
work. Id. Similarly, in Johnson, Mr. Johnson stated that
with respect to his previous employment that he neither
resigned in lieu of termination nor left under unfavorable
circumstances. Johnson, 257 F. App’x at 315. However, an
investigation found that Mr. Johnson had left amid accu-
sations of improper conduct. Id. We upheld the Board’s
decision affirming Mr. Johnson’s removal and debarment
from competitive federal service for three years. Id. Both
of these cases stand for the proposition that removal is ap-
propriate if an employee is not forthcoming on background
paperwork and provide helpful data points with respect to
Mr. Freeland’s case.
CONCLUSION
We have considered Mr. Freeland’s remaining argu-
ments and find them unpersuasive. Accordingly, the final
judgment of the Veterans Court is
AFFIRMED
COSTS
No costs. | 01-03-2023 | 08-07-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3397715/ | This judgment was recovered for breach of an implied warranty to keep meat under refrigeration.
The pleas asserted, in substance, that the meat was spoiled when accepted by defendant; that the spoilage did not increase while in storage and at no time did it breach any duty to plaintiff by allowing the temperature to rise or in any other manner cause the damage.
When the case came on for trial it became apparent to the trial judge that the value of the meat was not in controversy; that the only question for the jury to decide was the breach of the implied warranty to safely keep the meat under refrigeration. Accordingly, the trial judge instructed the jury to find for the full value of the meat should they find for the plaintiff.
The first error claimed is failure to allow the jury to determine the amount of damages in event of their finding for *Page 90
plaintiff. Under the evidence we find no error in this ruling. At that time the office of Price Administration maintained a ceiling price on meat and it was admitted that the ceiling price would determine its value. In fact, there was no evidence to require the submission of this issue to the jury.
Harmful error is also claimed for receiving testimony, some three or four days after the meat was condemned, to the effect that the temperature in the plant was allowed to rise. We find no merit in this contention. Defendant was doing a general cold storage warehouse business, pursuant to Chapter 678, Acts of 1941. Its duty was to exercise such care as a reasonably careful owner of similar goods would exercise. Sec. 678.21, Fla. Stat., 1941, F.S.A. The jury had ample evidence to find that the meat was in good condition when delivered to defendant. Several weeks later an inspector for the Department of Agriculture of Florida made an inspection and found it spoiled. The evidence is not clear just when the whole lot of meat was actually examined and condemned. It may be possible that evidence was received after the meat was spoiled, yet when we read the evidence as a whole we cannot say the judgment of the trial judge was clearly wrong when he approved the verdict.
The most persuasive element which stands out is that defendant was in the business of keeping products of this kind. It was not compelled to take the commodity. When it did so, it was put on notice to ascertain the condition of the meat and after accepting it and retaining it for a period of weeks it is only reasonable that a strong showing would be required to avoid liability. Defendant occupied a more advantageous position to offer evidence of damage. The jury had a right to infer that the meat was not damaged when accepted. If due care had been exercised the probabilities are it would not have spoiled. There was evidence of leaks in the coils which indicated defective refrigeration. We cannot say that evidence of a high temperature shortly after the meat was condemned did not aid the jury in passing on the case. We certainly cannot say that it was harmful error.
Finding no error in the judgment, it is affirmed.
CHAPMAN, C. J., TERRELL and BUFORD, JJ., concur. *Page 91 | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3856231/ | Argued April 30, 1941.
This is an appeal from the order of the Orphans' Court of Allegheny County removing the administrator of the estate of John R. Davies, Jr., deceased, and allowing the widow's exemption.
John R. Davies, Jr., a resident of Allegheny County, died intestate March 4, 1936, leaving to survive him a widow, the appellee herein and three minor children. The sole asset of his estate was a piece of land situate in the Township of Mifflin, Allegheny County, consisting of two lots, Nos. 278 and 279 in the Duquesne Annex Plan of Lots, recorded in the Recorder's Office of Allegheny County, Plan Book Volume 24, page 174. Prior to decedent's death L.H. Botkin obtained a judgment against him. On April 7, 1937, John F. White, Esq., attorney for Botkin, caused a writ of fieri facias to be issued, and the aforesaid real estate to be levied upon and sold at sheriff sale to John Jonosko and Helen Jonosko. A deed was delivered and recorded in D.B.V. *Page 9
2571, p. 130, June 2, 1937. No writ of scire facias was issued warning the personal representatives of Davies or the executors, as required by the Fiduciaries Act of 1917, June 7, P.L. 447, § 15 [i], 20 Pa.C.S.A. § 529.
The widow presented a petition to the court of common pleas alleging that the plaintiffs' sale was void and asked that the same be set aside and the deed stricken from the record. The rule granted thereon was made absolute on January 22, 1938. On February 2, 1938, she presented to Judge CHALFANT of the Orphans' Court of Allegheny County a petition setting forth that the value of the real estate of which decedent died seized did not exceed $500 and asked that it be set aside to her on account of her widow's exemption as provided in section 12 [f] of the Fiduciaries Act of 1917, supra, 20 Pa.C.S.A. § 477. The petition was retained by the judge but was not marked "filed" until March 2, 1938, on the date the land was awarded to the widow.
Robert L. Botkin, one of the executors of the will of L.H. Botkin, deceased, presented his petition as a creditor to the Register of Wills on February 10, 1938, for the appointment of an administrator of the estate of John R. Davies, Jr., and prayed that letters be granted to John F. White. The purpose of this application undoubtedly was to comply with the provisions of section 15 [i] of the Act of 1917, supra. Mr. White, as above noted, had represented L.H. Botkin in the execution proceedings. The Register of Wills granted the prayer of the petitioner. All that White, as administrator, apparently did was to accept the service of the writ of scire facias, which was issued subsequent to his appointment. He filed no answer thereto nor did he notify the widow that the sole asset of her husband's estate was levied upon, and that the land was to be resold by the sheriff. It appears that neither the widow, her attorney, nor the court, had knowledge that letters of administration had been granted until after the order of *Page 10
March 2, 1938, allowing the widow's exemption, had been entered.
On March 10, 1938, the executors of the will of L.H. Botkin, deceased, filed exceptions to the granting of the exemption. Before they were disposed of the Register of Wills on the petition of the widow issued a citation directing John F. White to show cause why the letters of administration granted to him should not be revoked. After an answer was filed thereto the widow presented a petition to the orphans' court praying that the exceptions filed to her exemption be held in abeyance pending the outcome of the proceeding she instituted to have the letters of administration revoked.
The Register of Wills then certified the proceedings pending before him to the orphans' court. On February 1, 1940, that court after argument entered a decree refusing to revoke the granting of letters of administration and directed that the record be remitted to the Register of Wills "without prejudice to the rights of the widow and the widow's claim for exemption." Exceptions filed thereto were dismissed on March 6, 1940. Two days later, to wit, March 8, the court in banc set aside and struck from the record the decree of March 6. On the same day the court entered a further decree sustaining the exceptions filed by Ruth M. Davies to the order entered February 1, 1940, and directed that John F. White, as administrator of the estate of John R. Davies, Jr., be removed and the letters of administration granted to him be revoked, and dismissed the exceptions filed to the allowance of the widow's exemption. This appeal followed.
We will consider first the appellants' contention that the court erred in awarding the exemption to the widow as she was guilty of laches in making her claim. Section 12 [a] of the Fiduciaries Act of 1917, supra, 20 Pa.C.S.A. § 471, which gives the right to a widow to claim the exemption, is silent as to the time within which she must make her claim. The principal case on which appellant relies *Page 11
is Clark Estate, 275 Pa. 506, 119 A. 590, wherein Mr. Justice SIMPSON, speaking for the court, said: "It may now be considered as established by Kern's App., 120 Pa. 523, and Machemer's Est.,140 Pa. 544, — the earlier conflicting authorities being overruled therein, — that if there has been no sale of the property allotted to a widow, an award of exemption to her may be set aside, on due application, if she had remarried `before her election was made' or if there was `a delay of a year in claiming her exemption.'" In that case the widow did not present her claim until five years after the death of the decedent and in the meantime she had remarried.
In Kern's Estate, supra, decedent died in April 1880. Letters testamentary were issued March 4, 1882 and the widow, who had remarried, did not file her claim for widow's exemption until September 24, 1883, almost three and one-half years after the testator's death and almost twenty months after the granting of letters. The court there said p. 530: "While we do not mean to say that she should be allowed so much as one year in which to claim her $300 exemption, the analogy of the statute which subjects her to a compulsory citation to elect as against a will, at the expiration of twelve months from her husband's death,
admonishes us that a delay of a year in claiming her exemption is gross laches, and in itself evidence of a waiver of her right." (Italics supplied.)
Under the provisions of law now in force the right to elect to take against a will exists for one year after the issuance ofletters. See Wills Act of 1917, June 7, P.L. 403, § 23 [b], as finally amended by the Act of 1935, July 8, P.L. 611, § 1, 20 Pa.C.S.A. § 262. If section 23 of the Wills Act gives any aid whatever by way of analogy to a proper construction of section 12 [a] of the Fiduciaries Act, it would be favorable to the widow's contention that she was not guilty of laches in making her claim as her petition was presented before letters of administration *Page 12
had been granted and 39 days after the sheriff's deed had been set aside.
In Machemer's Estate, also referred to in the opinion in the Clark case, the decedent died in 1860 and letters testamentary of his estate were not issued until 1887. The widow there remarried and died without having made any claim for exemption; it was made by her executor. In none of these cases was a one year limitation at issue.
In H.G. Beetem Co. v. Getz et al., 5 Pa. Super. 71, 75, we held that while the Acts of 1849, April 9, P.L. 533 12 PS 2161 et seq. and 1851, April 14, P.L. 612, upon which section 12 of the Act of 1917, supra, is founded, fixed no time limit for a widow to claim her exemption, it must be made within a reasonable time after the right accrues, and a reasonable time depends upon the circumstances of each particular case.
In Estate of William Cram, Deceased, 114 Pa. Super. 463,174 A. 838, we held under the circumstances existing there, that the delay of the widow for nineteen months after her husband's death and for more than thirteen months after letters testamentary were issued on his estate, convicted her of laches.
In Bell's Estate, 139 Pa. Super. 11, 10 A.2d 835, we said p. 13: "The right of the widow or of a child is determined with reference to the date the claim is made and not as of the date of death of the decedent."
In Degenkolv et al. v. Daube et al., 143 Pa. Super. 579,18 A.2d 464, we held that if the widow's claim is not made until after an "undue length of time" the right is lost.
Judge PENROSE, whose outstanding ability as an Orphans' Court Judge has been long recognized, very aptly said in Kelly'sEstate, 3 District Report, 15, 16: "Delay on the part of a widow in the assertion of her right to exemption is evidence of a waiver, and if prolonged unduly or until circumstances have changed or *Page 13
new rights intervened, it may operate as an estoppel. It is, however, susceptible of explanation; and if no one has been prejudiced by it the exemption may still be awarded: Williams'sEst., 141 Pa. 436." See, also, Vandevort's Appeal, 43 Pa. 462.
A review of the decisions of our appellate courts convinces us that it cannot be said that regardless of what the facts and circumstances may be there is an unyielding limitation of one year for a widow to claim her exemption and that thereafter she is barred from claiming it. To so hold disregards the broad purpose of our law to give the widow her exemption, which is recognized as a preferred claim or gift prompted by consideration of public policy: Peeble's Estate, 157 Pa. 605, 27 A. 792.
Whatever harm, if any, that the appellants have sustained was largely, if not entirely, due to the defective proceedings which they instituted, and not the result of the failure of the widow to promptly make her claim for exemption. Before the second sale occurred the judgment creditor and his attorney knew the claims and rights of the widow and assumed all risks in subsequent proceedings. "Exemption acts have been conceived in a spirit favorable to widows and have received an interpretation consistent with their conception. . . . . . Such exemption is a wife's inchoate property right in a husband's estate, which becomes complete when as his widow she sustains her claim for it." Hildebrand's Estate, 262 Pa. 112, 104 A. 866. See, also,Hettrick v. Hettrick, 55 Pa. 290.
The question of laches is determined on equitable principles and the widow's rights should only be defeated when it clearly appears that under all the attending circumstances she failed to exercise due diligence and that her delay was prejudicial to others. In the instant case Judge TRIMBLE in his opinion said: "It is not a part of the administration of justice to be astute to defeat this time-honored right of the widow." *Page 14
The widow was not compelled to go to the expense of taking out letters of administration immediately after the death of her husband. The estate was insolvent and under advice from counsel she refrained from seeking her exemption. The delay in the granting of letters of administration was as much the fault of the judgment creditor as the widow. See Remick: Pennsylvania Orphans' Court Practice, Vol. I, p. 11. She never took any affirmative action that indicated that she forfeited or waived her claim. In view of the attending circumstances in this case we think that the widow's right to an exemption should not be defeated owing to her alleged laches.
We come now to the question of whether the court below erred in revoking the letters of administration. Section 2 [d] of the Act of 1917, supra, as amended by the Act of March 24, 1921, P.L. 51, § 1, May 25, 1939, P.L. 209, § 1, 20 Pa.C.S.A. § 348 requires that applications for letters of administration shall set forth the "names and residences of the surviving spouse, if any, and of the next of kin of the intestate." The court found as a fact, which must be accepted as true, as the findings of fact have not been assigned as error, that while the petition for the appointment of John F. White as administrator stated the address of the widow and children of John R. Davies, Jr. was unknown, the administrator and the judgment creditor knew that Ruth M. Davies was represented by counsel, that no notice was given to counsel, nor was any request made to him to furnish his client's address.
Furthermore, the administrator failed to advertise the granting of letters thus violating section 10 of the Act of 1917, supra, 20 Pa.C.S.A. § 441 or to comply with rule 12 of the Orphans' Court of Allegheny County, which provides as follows: "Sec. 1. Immediately after the grant of letters testamentary or of administration, the fiduciary shall notify the widow or children of the right to an exemption of the value $500. . . . . ." The appellants *Page 15
attempt to justify their failure to give notice, by asserting that the widow was a non-resident. There is no proof of that allegation; it does appear, however, that she was living in Meadville, Pennsylvania while this proceeding was pending.
Another duty of the administrator, which was not performed, although it is not very important in this case, was the preparing and filing of an inventory within 30 days from the time of administration granted: Section 11 [a], Act of 1917, supra, 20 Pa.C.S.A. § 442. He did, however, violate in several material particulars, to which we have referred, the express requirements of the law to the detriment of the widow. There can be no question that letters of administration may be revoked if wrongfully or improvidently granted: Section 5 of the Register of Wills Act of 1917, supra, P.L. 415, 20 Pa.C.S.A. § 1863; Phillip's Estate, 293 Pa. 351, 143 A. 9. An administrator is not only a trustee for the benefit of creditors, but the widow and children of the decedent: Wolfe etal. v. Lewisburg Trust and Safe Deposit Company, 305 Pa. 583,158 A. 567. As the court below says the obvious appointment of White as administrator was to "set up a straw man who could be warned by scire facias that an execution was to be issued upon the aforesaid judgment entered by L.H. Botkin against John R. Davies, Jr., . . . . . ." It is quite obvious that the administrator did not attempt in any way to notify the widow of any of the proceedings instituted in this case, or otherwise take steps to protect her interest.
A careful consideration of this case fails to convince us that the court erred in revoking the letters granted to Mr. White.
Order of the court below is affirmed. *Page 16 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3854378/ | Argued March 6, 1939.
The court below on October 16, 1936, directed that Muriel, Hope, and Ira Dennis, minor children of Charles Dennis, be committed into the custody of the Church Home, Jonestown, Pennsylvania, at the expense of Scott Township Poor District. On February 15, 1937, upon petition of A.L. Miller, a director of the Lake View Poor District in Scott Township, the court granted a rule to show cause why its order should not be modified to the extent of revoking the provision that the minor children be maintained at the expense of Scott Township Poor District and place the expenses on Blakely Township. The court, after hearing, directed that their maintenance be paid by "the County of Lackawanna, the said County of Lackawanna to be reimbursed therefor by the Lakeview Poor District" of which Scott Township is a constituent. This appeal followed.
The facts, which were agreed upon at the hearing, show that prior to October 1, 1933, the settlement of the Charles Dennis family was in Blakely Poor District. On that date, due to the unemployment situation, this family, consisting of the father, an adult son, Charles, Jr., two minor sons, and the three children above named, was granted emergency relief by the Lackawanna branch of the Emergency Relief Board. This relief was discontinued December 21, 1933, as Charles, Jr., was assigned to a CWA job, but it was resumed March 19, 1934, by the State Emergency Relief Board, and continued until November 26, 1935, when it was again discontinued as Charles, Jr., was assigned to a WPA job. In the meantime, to wit, May 3, 1934, *Page 239
when unemployment relief was being furnished this family, they moved from Blakely Poor District to Scott Township Poor District and remained there until June 24, 1936, when they took up their abode in the borough of Jermyn, where they were living, but had not acquired a settlement, when the three minor children were committed to the Church Home under the order of October 16, 1936.
The General Poor Relief Act of May 23, 1933, P.L. 966, § 800, amending the Act of May 14, 1925, P.L. 762 (repealed June 24, 1937, P.L. 2017, § 702), provided:
"(c) The settlement of a person in a poor district continues until a new one is acquired in this State, or elsewhere. . . . . .
"(d) Except as hereinafter otherwise provided, every adult . . . . . . may acquire a new settlement in any poor district of this Commonwealth by coming bona fide to establish a permanent abode therein and continuing to reside therein for one whole year, if such person . . . . . . is of sufficient mental ability to make a bargain, and is not, or, does not become a public charge during said year.
* * * *
"(h) Before emancipation, the settlement of a legitimate minor is and remains that of the father. . . . . ."
"Public charge," as defined in section 10 of the Act of 1925, supra (62 P. S. § 10), was as follows: "`Public charge' shall mean a person to whom poor relief from public funds is necessary for his maintenance — a pauper."
Admittedly, on the date of the court's order, October 16, 1936, the father of these children was unable to pay the cost of maintaining them in the Church Home, so that at that time they were public charges.
The question before us is: Under the foregoing facts did these three minor children, at a time when the family was receiving relief from the State Emergency Relief *Page 240
Board, gain a settlement in Scott Township Poor District? If so, this order should be affirmed.
The answer thereto depends upon whether the children were public charges or paupers when they took up their residence in Scott Township Poor District, or within a year thereafter. If so, they never obtained a legal settlement therein. It will be noted that at the time of the removal of the Dennis family to Scott Township, they were receiving aid from funds appropriated by the state and federal government for the relief of the unemployed, under authority granted by the act creating the State Emergency Relief Board, approved August 19, 1932, P.L. 88, Spec. Sess. (repealed June 24, 1937, P.L. 2051, § 18.)
The Talbot Act, approved the same day (P.L. 90), is entitled "An Act relating to unemployment relief; making an appropriation to the State Emergency Relief Board for direct relief and work relief. . . . . ."
In Hattler v. Wayne County, 117 Pa. Super. 570,178 A. 513, affirmed by the Supreme Court in a per curiam (320 Pa. 280,182 A. 526), claim was filed by a dependent mother to recover compensation for the death of her son resulting from injuries received while he was alleged to have been employed by the county of Wayne. The deceased was assigned by the Emergency Relief Board of Wayne County, under the provisions of the Talbot Act, supra, to work on county roads, under the direction of the county commissioners. In directing that a judgment be entered for the claimant in accordance with the findings and conclusions of the Workmen's Compensation Board, we said that the Talbot Act clearly discloses a primary intent of the legislature to deal with unemployment rather than with the care of paupers as that term has been used in our poor laws.
The type of aid furnished this family cannot be considered as a form of poor relief to public charges or paupers who came within the General Poor Relief Acts. *Page 241
There is no proof on the record before us that prior to the court's order Charles Dennis was a pauper as he had not applied for or received poor, as contra-distinguished from unemployment, relief from the public funds for his maintenance. The minor children were, therefore, not paupers. People who are able and willing to work but cannot get it, who obtain unemployment relief, cannot be justly characterized as paupers. Charles Dennis, Jr., on May 3, 1934, when the family moved to Scott Township and was receiving unemployment relief, was working in the mines. This family was not at that time or within a year thereafter so poor and in such extreme want as to properly designate them as destitute. In Allegheny County v. Pittsburgh,281 Pa. 300, 302, 127 A. 72, the court said: "The term `poor' as used in the law, means `destitute; helpless and in extreme want; . . . . . . so completely destitute of property as to require assistance from the public. . . . . .'" The adult members of this family registered and voted in Scott Township; they paid their rent for over two years, all of which tends to show they were not public charges and had acquired a settlement in that township.
The situation was entirely different in Moscow Borough PoorDistrict's Appeal, 119 Pa. Super. 533, 180 A. 718. The widow in that case was definitely a public charge when she came into the Moscow district and, therefore, she could not obtain a new settlement there.
Order of the court below is affirmed, at appellant's costs. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4045553/ | ACCEPTED
06-14-00101-CV
SIXTH COURT OF APPEALS
TEXARKANA, TEXAS
4/15/2015 4:55:24 PM
DEBBIE AUTREY
CLERK
FILED IN
6th COURT OF APPEALS
TEXARKANA, TEXAS
4/15/2015 4:55:24 PM
DEBBIE AUTREY
Clerk | 01-03-2023 | 09-28-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3397825/ | [EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *Page 479
The appeal brings for review order or decree made by the circuit court on the 25th day of January, 1938, as follows:
"And now this cause coming on this day to be heard upon the motion of plaintiff by her solicitors, Metcalf Finch, to —
"1. Set aside, vacate and hold for naught the order permitting Sallie Lee to intervene;
"2. Strike from the file the petition for intervention filed by Sallie Lee;
"3. Strike from the file the answer and counterclaim filed by Sallie Lee; and
"4. To make and cause to be entered a final decree upon the pleadings and proof; and the court having heard argument by the respective parties and being advised in the premises, it is thereupon
"ORDERED, ADJUDGED AND DECREED that said motion be and the same is hereby denied."
This is the second appearance of this litigation in this Court. See Daugherty v. Latham, et al., 128 Fla. 271, 174 So. 317. A syllabus by the Court in this case is: "Dismissal for want of equity of bill to enjoin closing of a public highway held erroneous, where complainant alleged that highway was her only means of ingress and egress to *Page 480
her farm, that closing would deprive her of means to transport her farm products and necessities of life to market, and that highway was closed for benefit of other private property owners and in an effort to deprive complainant of highway's use."
The record shows that certain citizens including the intervenor, Sallie Lee, petitioned the County Commissioners of Volusia County, as follows:
"TO THE HONORABLE, BOARD OF COUNTY COMMISSIONERS OF VOLUSIA COUNTY, FLORIDA, GREETING:
"We, the undersigned, citizens and free-holders living in the vicinity of the road herein prayed to be abandoned would respectfully represent unto your Honorable Body that it is necessary and expedient that a public road be abandoned as follows:
"Beginning at a point in the South line of the 'Perkins Highway, 587.5 feet easterly from the west line of lot 5, subdivision of M.E. Levy Grant, per map book 2, page 154. Thence S. 42 degrees 45 Min. East 210 feet, thence south 25 degrees 30 min. East 248.4 feet to the south line of said lot 5. WHEREFORE, we pray that your Honorable Body issue an order directing to three disinterested free-holders of Volusia County, Florida, to view and mark out the said road to be abandoned, and that after said road is marked out by said viewers, and their report made of the same is accepted, that your Honorable, Body will after giving notice thereof as required by law, make an order for the abandonment of said road, and declaring the same to be no longer a public road.
"Said road having been _____ feet wide and known as _____ Road No. 1.
"All of which is respectfully submitted by the undersigned petitioners, on this the 31st day of July, A.D. 1935." *Page 481
Other petitions of like character were also filed.
Viewers were appointed and reported. Thereafter, certain citizens and free-holders living in the vicinity of the old road filed objections to the abandonment of the old road and establishment of a new road.
When the County Commissioners ordered the road changed, or the abandonment of the old road and the laying out of the new road, Mrs. Daugherty exhibited her bill of complaint in the circuit court seeking to enjoin the abandonment of the road referred to as the old road.
Motion to dismiss the bill of complaint was filed. The motion was granted.
Appeal was taken to this Court and the order reversed. Thereafter the county commissioners filed answer.
Paragraph 4 of the bill of complaint alleges:
"Plaintiff attaches hereto as Exhibit A, and makes a part hereof, a map of lots 5 to 8, inclusive, and Lots 30, 31 and 32 of the said subdivision of M.E. Levy Grant situated in Volusia County, Florida, recorded in said Plat Book 3, page 154 in said clerk's office, which map will be referred to hereinafter; that lot 5 shown on the said map, except the road running north and south thereon, is owned by Mrs. Sallie Lee and Blish D. Lee and the plaintiff owns a life estate in the W 1/2 of Lot 6, which abuts upon the road which defendants have signified their intention to close and abandon, hereinafter described, and the W 2-3 in said Lot 7, and her residence is situated at the point marked 'residence' on said map; that she does not own any portion of the east one-half of Lot 6 or any portion of Lot 7 lying east of the line designated on said plat: as 'dividing line' that the dotted line leading north from plaintiff's residence across lots 6 and 5 to the Perkins Highway represents a public highway which is about fifteen feet in width, and which *Page 482
highway has been opened and traveled by the public in general at all times since the residence was erected, in which plaintiff now resides, which was fifty years before this date; that during the said period of time, the said highway has been, and still continues to be, the only road over and along which this plaintiff and her family residing in her said residence, can travel to reach a public highway leading to DeLand about six miles away, which is now, and has been for the past fifty years, the market where plaintiff and her husband and family have sold their crops and purchased their supplies; that it has been, and is now, the only road over which plaintiff's friends and relatives could travel in going to and from plaintiff's home, and has been during the same period of time, and now is, the only road over and along which plaintiff can transport her agricultural and grove products in order to reach the market; that the line designated as 'Perkins Highway' on the plat hereof attached is a paved public highway leading from DeLand, Florida, in a northeasterly direction to points far beyond plaintiff's residence, and is the only road which is available for plaintiff to travel in reaching the said city."
Answer to the fourth paragraph of the bill of complaint is as follows:
"That these defendants deny each and all of the allegations of the fourth paragraph of plaintiff's bill of complaint except these defendants admit the allegations of ownership of property described in said paragraph, as stated in said paragraph Fourth of the plaintiff's bill of complaint."
The seventh paragraph of the answer is as follows:
"That these defendants further answering the plaintiff's bill of complaint say that they would not discontinue the road described in the plaintiff's bill of complaint except and unless another road was provided so that the plaintiff could *Page 483
go to and from her home over and upon the public roads described in her bill of complaint. That these defendants are willing to build and construct a better and more suitable road from the Perkins Highway to the place of residence of the plaintiff providing a sufficient right-of-way can be obtained therefor from the plaintiff and her relatives."
On October 15, 1937, Sallie Lee filed petition in the circuit court to be allowed to intervene. In her petition she alleged,inter alia:
"That she is the sole owner of lot number 5 of the Moses E. Levy Grant, Section 37, Township 16 South of Range 30 East, Volusia County, Florida; and that she has been such owner since 1890; that the said property was acquired by deed from her father and mother, John and Margaret Daugherty. That at the time she acquired the said property from her father there was an orange grove of between five and six acres which was located on the southeast corner of lot number 5; and that said lot contains 15 acres; that the balance of lot number 5 was wild, unimproved and vacant lands.
"2. And your petitioner further alleges that there never has been any dedication by her for the road across lot number 5 to the public use but that by the way of necessity the family of Florence Daugherty located on lot number 7 of the Moses E. Levy Grant have been permitted to use the said road, always with the understanding that should the balance of lot number 5 be used for cultivation of farm or citrus crops, that another road would be established, furnishing the family of Florence Daugherty and those living with her, a way of ingress and egress to Perkins Highway for the purpose of transporting her farm products to a near market, and she further alleges that in 1932 when an orange grove was set out on the remaining three-quarters *Page 484
of lot number 5 and that when the same was discussed with John Daugherty, the husband of Florence Daugherty, as to the opening of another road to the property on lot number 7, owned by the said John Daugherty and now owned by the plaintiff, there was no objection to the change.
"3. That in conformance with the statement in paragraph 2, your petitioner did deed to the county commissioners who are defendants in the above entitled cause, a road on the eastern border of lot number 5, a road to replace the former road which was used as a way of necessity; and that Charles Lungren, owner of lot number 31 of the Moses E. Levy Grant, did also deed a continuance of the road deeded on the east side of lot number 5, bringing said road to the property of Clara Burgin who is the daughter of plaintiff and lives with her, the terminal of which road would be at a corner of lot 31, owned by Charles Lungren; lot number 30 owned by Hardy Daugherty, and the east 500 feet of lot numbered 7, owned by Clara Burgin, the daughter of the plaintiff herein and who lives at the residence of the plaintiff.
"4. And your petitioner further alleges that she has spent large sums of money in the planting and the cultivating of the new grove on lot number 5; and that she would suffer irreparable loss and damage if the old road across her orange grove is not closed and abandoned."
This petition for intervention was based upon the hypothesis that the road theretofore referred to in the proceedings was not a public road but was a way used by leave and license of Sally Lee and her predecessors in title and those using said way as a road used it with the understanding and on the conditon that should the balance of lot number 5 be used for cultivation of farm or citrus crops another road would be established furnishing the family of *Page 485
Florence Daugherty and those living with her a way of egress and ingress to the Perkins Highway for the purpose of transportation.
It is further alleged:
"That in 1932 when an orange grove was set out on the remaining three-quarters of lot number 5, and that when the same was discussed with John Daugherty, the husband of Florence Daugherty, as to the opening of another road to the property on lot number 7, owned by the said John Daugherty and now owned by the plaintiff, there was no objection to the change."
Further allegations are made, the effect of which is to show the interest of Sallie Lee in the abandonment of the road involved and the establishment of a new road.
On October 15, 1937, without notice to the complainant Sallie Lee was by order of court allowed to intervene as a defendant and file her answer. She fined answer, and, inter alia,
alleged:
"And your intervenor further alleges that there never has been any dedication by her for the road across lot number 5 to the public use but that by the way of necessity, the family of Florence Daugherty located on Lot number 7 of the Moses E. Levy Grant have been permitted to use the said road, always with the understanding that should the balance of lot number 5 be used for cultivation of farm or citrus crops, that another road would be established, furnishing the family of Florence Daugherty and those living with her, a way of ingress and egress to the Perkins Highway for the purpose of transporting her farm products to a near market, and she further alleges that in 1932 when an orange grove was set out on the remaining three-quarters of lot number 5, and that when the same was discussed with John Daugherty, the husband of Florence Daugherty, *Page 486
as to the opening of another road to the property on lot number 7, owned by the said John Daugherty and now owned by the plaintiff, there was no objection to the change.
"That in conformance with the statement in paragraph 2 your intervenor did deed to the County Commissioners who are defendants in the above entitled cause, a road on the eastern border of lot number 5, a road to replace the former road which was used as a way of necessity and that Charles Lungren, owner of Lot number 31, of the Moses E. Levy Grant, did also deed a continuance of the road deeded on the east side of Lot number 5, bringing said road to the property of Clara Burgin who is the daughter of the plaintiff and lives with her; the terminal of which road would be at a corner of lot 31, owned by Charles Lungren; Lot number 30 owned by Hardy Daugherty; and the east 500 feet of Lot number 7 owned by Clara Burgin, the daughter of the plaintiff herein who lives at the residence of the plaintiff. And that there is no road from the home of Florence Daugherty across the Burgin property to the new road.
"And your intervener further alleges that she has spent large sums of money in the planting and the cultivating of the new grove on lot number 5 and that she would suffer irreparable and damage if the old road across her orange grove was not closed and abandoned.
"And your intervener further alleges that the only family served by the old road is the family of the plaintiff, and it is not a road serving a general community inasmuch as the beginning is on the Perkins Highway and the end at the home of the plaintiff.
"And your intervener further alleges that the road which has been deeded and accepted by the County Commissioners of Volusia County shows only a difference of about 800 *Page 487
feet farther travel than the road sought to be abandoned; and that the ingress and egress to and from the home of the plaintiff to the new road so deeded is only upon the land of the plaintiff or her daughter who lives with the plaintiff.
"And your intervener further alleges that prior to the building of the Perkins Highway there were divers and many trails and roads across the wild lands of that section and that at no time has your plaintiff been deprived of ingress an degress from her home by other means than upon the road which crosses your petitioner's orange grove on lot number 5.
"And your intervener further alleges that there has been no fraud, collusion or conspiracy between her or her agents and Mr. E.A. Latham, Chairman, and Mr. J.H. Graham, and Mr. Peter Gessner, members of the Board of County Commissioners of Volusia County, Florida. Which said conspiracy is more particularly set forth in paragraph 5 of the bill of complaint now on file in this cause; which said conspiracy is more particularly set forth in Section D, paragraph 7 of the bill of complaint. And that her purpose in deeding the new road was to prevent further loss and damage to her young grove located on lot number 5.
"And your intervener further alleges that the said road deeded by her to the County Commissioners and the continuance thereof to the Daugherty line by Charles Lungren will be a better road than the one now sought to be closed; and that the said new road will be graded, ditched and drained and placed in good condition for travel prior to the closing of the road referred to in the plaintiff's bill of complaint, and no injury whatsoever will be suffered by the plaintiff; and that she will have ingress and egress to and from her property for the purpose of transporting her farm products, *Page 488
etc., to the markets in DeLand; and that the public use by the way of necessity of the road across lot number 5 will no longer exist.
"And your intervener is at all times ready to do equity to the rights of the plaintiff herein, and that in accordance with her former allegation in paragraph Seven, Section B, and that there will be no obstruction placed on the road over Lot number 5 until such time as complies with her agreement set forth in said paragraph Seven, Section B.
"That she is and always has been ready to furnish a means of egress and ingress to the property of the plaintiff. And will furnish such outlet if it should be determined that a road over the property of Clara Burgin and Byrd Burgin, both of whom reside with the plaintiff, is impossible or impractical, in which case then your intervener will establish a road on her own property on the boundary line of Lot Number Five in order to give such ingress and egress to the plaintiff. Such road being on the boundary lines and not bisecting Lot Number Five."
Motion was made to strike the petition of intervention and to vacate the order allowing intervention, to strike from the files the answer and counterclaim filed by Sallie Lee, and for final decree on the pleadings and testimony taken.
The order appealed from above quoted was then entered.
Appellants have stated several questions for our consideration in the bill filed here, but we think that to answer the fourth question stated is all that is required to dispose of this appeal. That question is stated as follows:
"Fourth Question: In an action against county commissioners to restrain the closing of a public highway, it appearing from the bill and proof thereof that the officials are not attempting to close the road for the public welfare but for the benefit of the owner of the land traversed by the *Page 489
road and that if the road is closed plaintiff will be deprived of her right of ingress and egress to and from her home and the highway leading to market; and it further appearing that the court permitted the owner of the land traversed by the road to intervene without notice and file an answer as a party defendant asserting no legal reason for closing the road, should the court, upon motion of plaintiff, vacate the order of intervention, strike the answer filed by the intervener and render a final decree against the defendants as prayed?"
The intervener, by joining in the petition to the County Commissioners to abandon the road affirmatively recognized the road as a public highway. A public highway may be established by grant and acceptance or by prescription and usage. See Burdine v. Sewell, 92 Fla. 375, 109 So. 648; Atlantic Coast Line R. Co. v. Duval County, 114 Fla. 254, 154 So. 331.
When the petitions praying the abandonment of the old road and the establishment of a new road were presented the county commissioners assumed jurisdiction under the provisions of Section 1593 R. G. S. 2441 C. G. L., looking to the abandonment of the old road and the establishment of a new road. By this action the county commissioners affirmatively recognized the road involved as a public highway.
In 29 C. J. 520, Sec. 230, it is said: "As a foundation for a proceeding to vacate there must be a public highway actually existing. It is immaterial how such highways originated, whether by long usage, dedication, act of Congress of under authority of a special charter. The application to vacate may be limited to a part of a road, and in such case it is lawful to vacate such part only, although the ending left is not at a place of public resort or convenience, *Page 490
but the vacation cannot lawfully be less extensive than the application. In the absence of express statutory authority, mere private ways are, of course, not subject to vacation by the public authorities." Ample authority is cited to suppor the text, supra.
The complainant filed her bill of complaint alleging sufficient facts to show that the road had become a public highway by prescription and usage.
There has been no final decree entered and, therefore, it is not within the province of this Court to now determine whether or not the evidence submitted, taken together with the allegations of the pleading and the record of what transpired hereinabove referred to is sufficient to support a decree holding this to be a public highway and subject to abandonment by the board of county commissioners.
If the road in question is not a public highway to such an extent as to provide the complainant in the court below with a perpetual easement in the use of the same, then the county commissioners are without power or jurisdiction to take any affirmative action toward closing the road and whether or not they had the power and jurisdiction to close and abandon that road would not affect the power and jurisdiction of the board to establish a public road where it is necessary for such road to be established for the benefit of the public.
Section 9 of the 1931 Chancery Practice Act provides:
"Section 9. Interventions. — Anyone claiming an interest in the litigation may at any time be permitted to assert his right by intervention, but the intervention shall be in subrogation to, and in recognition of, the propriety of the main proceeding, unless otherwise ordered by the court in its discretion." *Page 491
Mr. McCarthy, in his Florida Chancery Act, Annotated, 2nd Ed., says:
It is generally said by the federal courts that the power to grant leave to intervene is discretionary, except where the petitioner claims an interest in specific property within the exclusve jurisdiction and subject to the exclusive disposition of the court, so that his interest can be enforced in no other way, than by the action of that court, in which class of cases the right to intervene is absolute. See W. U. Tel. Co. v. U.S. M. T. Co. (C. C. A. 8), 221 Fed. 545, and cases there cited. If this is a correct statement of the law, and if it is interpreted to mean that the intervener's rights must be such as can be enforced in no other way than by action of that particular court in that particular proceeding, it would confine the absolute right to intervene to a very narrow class of cases, namely, to those cases in which the intervener's interest would be bound without making him a party to the suit. It would mean, however, that such discretion as the equity court has under Section 9 in granting or denying leave to intervene is the limited discretion which the chancellor exercises in granting any kind of equitable relief."
In the note under Section 9, supra, the author also says: "Section 9 authorizes an intervention by any one claiming an interest in the litigation, not merely an interest in property in the custody of the court. The federal cases seem to give no satisfiactory definition of the term 'interest in the litigation.' In Consolidated Gas Co. v. Newton (D.C. N.Y.) 256 Fed. 238, it was said that it must be a legal interest; but that definition obviously is not accurate, because one having merely an equitable interest may intervene. See Nelson v. Tropical Land Co., 93 Fla. 203, 111 So. 512, for an example of an intervention by one having *Page 492
equitable claim. In Caldwell v. Guardian Trust Co. (C. C. A. 8), 26 F.2d 218, it was said that the interest must be direct and immediate, not remote. Ebersbach v. Ringling,100 Fla. 1270, 131 So. 148, is an example of such a remote interest."
So it appears that under the present chancery practice in this State no notice is required to be given of petition to intervene.
It must be borne in mind that this is not a suit to acquire a way of egress and ingress to lands being used as a home or for agricultural or stock-raising purposes under the provisions of Section 4999 R. G. S., 7088 C. G. L., and, therefore, the adjudication of the rights of the complainant and of the intervener as against one another in the road here under consideration are not involved in this suit and may not be injected into it.
The whole purpose of this suit is to determine and adjudicate whether or not the board of county commissioners in the exercise of the power, jurisdiction and discretion reposed in it may in its capacity as such board close and abandon the road involved and establish a new road in lieu thereof. The question of private rights between the complainant and the intervener has no place in this suit.
It is settled in this jurisdiction that, the general rule subject to certain exceptions is that a party cannot be required to sue those against whom he does not wish to proceed nor state another case than that upon which he elects to rely. If he fails to make necessary parties to the suit or does not make necessary averments as to those against whom he proceeds, his suit fails; but whether he will cure the defect by amendment rests with him." See Doke Wainwright v. Williams
Peek, 45 Fla. 248, 34 So. 569. In that case it was further said: *Page 493
"As was said by Chancellor COOPER, in Stretch v. Stretch,supra, 'to make a new defendant to a bill claiming in a right not noticed by the bill would throw the rules of chancery pleading into utter confusion, for it would be to try rights without any issue between the parties.'
The law does not deny a remedy to third persons having an interest in the subject-matter of litigation, but it requires that it be so sought as to permit the rights of all parties to be duly presented to the court. They may, in cases demanding it, file an appropriate bill, which those with adverse interests will have opportunity to resist in the regular way. Stretch v. Stretch, supra; Ex Parte Printup, supra."
After careful consideration of the petition for intervention and the answer filed pursuant to permission granted by the Court, we must hold that the answer contains no allegations showing the intervener to have any justiciable interest in this litigation. Therefore, the motion to strike the answer should have been granted and the intervener should have been dismissed.
The order appealed from is, therefore, reversed and the cause remanded for further proceedings not inconsistent with the views herein expressed.
TERRELL, C. J., and WHITFIELD, BROWN, CHAPMAN and THOMAS, J. J., concur. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3856241/ | Argued April 29, 1927.
The appellant here is the husband of Edith A. Gass, appellant in No. 165, April T., 1927, of this court, in which case an opinion has this day been filed. The questions involved on this appeal are identical with those considered and disposed of in the said appeal at No. 165, April T., 1927, and for the reasons there given the judgment in this case should be reversed.
The assignment of error is sustained, the judgment is reversed and judgment is now entered in favor of appellant upon the verdict.
HENDERSON and TREXLER, JJ., dissent. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3397858/ | On the 17th day of May, 1937, plaintiff below filed his petition under Section 3049 C.G.L. for the exclusion of eighty acres of land owned by him from the incorporated limits of the Town of Lake Maitland, Florida. It will be observed that this is purely a statutory action making it incumbent upon the plaintiff in error to show that the incorporated town contains less than 150 qualified electors. The statute gives jurisdiction to the Circuit Court only when there are less than 150 qualified electors in the said municipality. Likewise Section 2946 C.G.L. provides for the qualification of electors of a municipality, except as otherwise provided. The municipality of Lake Maitland was created under the General Law in 1885. Shortly after its organization, viz., November 2, 1885, an Ordinance of the *Page 722
Town of Lake Maitland was adopted prescribing the qualification or qualifications of electors. Chapter 6068, Special Acts of 1909, Laws of Florida, validated and established the then existing municipality of Lake Maitland and defined its boundaries, including therein all the lands in the original municipality and additional lands annexed by subsequent ordinances. Chapter 15298, Special Acts of 1931, prescribed the qualifications of electors or voters of the Town of Lake Maitland, and further authorized the said municipality to make rules and regulations governing registrations and elections, but did not repeal, alter, or modify the ordinance previously adopted prescribing the qualification of voters as of November 2, 1885.
It is contended here that if Chapter 15298, supra, is given a prospective construction or interpretation then it is clearly established that the Town of Lake Maitland had less than 150 qualified electors at the time of filing the petition in the suit at bar, but if it is given a retroactive construction or interpretation, the qualified electors thereof will be more than 150, and the terms of the statute will not authorize plaintiff to maintain this suit. The lower court gave the statute, supra, a retroactive construction or interpretation, and we think or believe that there was no error committed in so doing. It is incumbent upon the plaintiff in error to show that the Town of Lake Maitland at the time of filing the petition, contained less than 150 electors before the Circuit Court acquired jurisdiction. See Town of Lake Maitland v. Carlton, 103 Fla. 583, 137 So. 707.
Counsel for plaintiff in error contend that no municipal benefits accrued from the Town of Lake Maitland to the property owned by plaintiff in error; that the assessment and collection of taxes on the property by the city in effect is taking property without due process of law and is an arbitrary exercise of the power of taxation without right *Page 723
and is contrary to the due process provision of the Constitution. While this Court is helpless, for the lack of jurisdiction, to adjudicate the contentions of counsel this Court has held that where no adequate remedy is afforded land owners by proceedings at law for excluding lands from illegal municipal taxation, courts of equity may, in proper cases by appropriate procedure and decrees, pursuant to controlling principles of law, in the absence of estoppel, release particular lands that are illegally included in municipalities from unjust taxation therein for purposes that cannot in any way, actually or potentially, benefit the lands or the owners, and the lands cannot be useful for any proper municipal purposes. See State, ex rel., Attorney General v. City of Avon Park, 108 Fla. 641, 149 So. 409. It was held, in the absence of a statutory remedy and in cases where quo warranto
is not applicable, the remedy in proper cases where the law of incorporation is not invalid, may be in equity to enjoin illegal taxation. See State, ex rel., Landis v. Town of Boynton, 129 Fla. 528, 177 So. 327; City of Sarasota v. Skillin, 130 Fla. 724,178 So. 837.
The judgment appealed from is affirmed without prejudice to any legal or equitable remedy now possessed by the plaintiff in error. It is so ordered.
WHITFIELD, TERRELL and BUFORD, J.J., concur.
BROWN, J., concurs specially. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/8707811/ | *155RULING ON PLAINTIFF’S MOTION FOR ATTORNEYS’ FEES
JANET BOND ARTERTON, District Judge.
Following a six-day trial, the jury returned a verdict in Plaintiff Andrew Barati’s favor on his claims under the Federal Rail Safety Act, 49 U.S.C. § 20109 (“FRSA”), and the Federal Employer Liability Act, 45 U.S.C. § 51 (“FELA”) against Defendant Metro-North Railroad Company (“Metro-North”). Judgment in the amount of $20,000 on Plaintiffs FELA claim, $41,778 on Plaintiffs FRSA claim, and $250,000 in punitive damages has been entered. {See Am. Judgment [Doc. # 152].) Plaintiff moves [Doc. # 130] for an award of attorneys’ fees and costs, as a prevailing party under the FRSA. See 49 U.S.C. § 20109(e). For the reasons that follow, Plaintiffs is awarded $273,536.25 in attorneys’ fees, and $14,425.03 in costs.
I. Discussion
Both the Second Circuit and the Supreme Court “have held that the lodestar — the product of a reasonable rate and the reasonable number of hours required by the case — creates a presumptively reasonable fee.” Millea v. Metro-North R. Co., 658 F.3d 154, 166 (2d Cir.2011) (citing Arbor Hill Concerned Citizens Neighborhood Assoc. v. County of Albany, 522 F.3d 182 (2d Cir.2008); Perdue v. Kenny A. ex rel. Winn, 559 U.S. 542, 130 S.Ct. 1662, 176 L.Ed.2d 494 (2010)). “[A] ‘reasonable’ fee is one that is sufficient to induce a capable attorney to undertake the representation of a meritorious [ ] case.” Perdue, 130 S.Ct. at 1667. “There is a ‘strong’ presumption that the lodestar method yields a sufficient fee,” id., but “[a] district court may adjust the lodestar when it does not adequately take into account a factor that may properly be considered in determining a reasonable fee,” Millea, 658 F.3d at 167 (internal citations and quotation marks omitted). For example, “an enhancement may be appropriate where the method used in determining the hourly rate employed in the lodestar calculation does not adequately measure the attorney’s true market value, as demonstrated in part during the litigation.” Perdue, 130 S.Ct. at 1674. However, “an enhancement may not be awarded based on a factor that is subsumed in the lodestar calculation.” Id. at 1673. The burden of proving that an enhancement is necessary must be borne by the fee applicant.” Id.
A. Reasonableness of Rate
Plaintiff seeks fees at rates of $550 per hour for Attorney Charles Goetsch and $375 for Attorney Scott Perry. Defendant argues that Attorney Goetsch’s rate of $550 per hour should be reduced because it is above the highest rates approved in this district, and that consequently, Attorney Perry’s rate, as the second chair in this case, should be similarly reduced. “[T]he lodestar looks to the prevailing market rates in the relevant community.” Perdue, 130 S.Ct. at 1672. In support of his fee application, Plaintiff submits affidavits from Attorney Joseph Garrison, Attorney David Rosen, and Attorney Robert Richardson stating that billing rates of $550 for Attorney Goetsch and $375 for Attorney Perry represent reasonable rates for attorneys in this District with their respective experience and expertise. {See Attachments to PL’s Mem. in Supp. [Doc. # 131].) Attorney Richardson states that an attorney at his firm with experience similar to Attorney Perry would bill at between $350 and $400 per hour. {See id.) Attorney Garrison states that he currently bills at a rate of $575 per hour, and that given Attorney Goetsch’s level of experience, he would likely bill at slightly less than that as a member of Attorney Garrison’s "firm. {See id.) Attorney Rosen states that he bills at $525 per hour, and *156points to a 2012 opinion in this District, see Valley Housing Ltd. P’ship v. City of Derby, No. 3:06CV1319 (TLM), 2012 WL 1077848, at *5 (D.Conn. Mar. 30, 2012), awarding him a fee of $485 per hour in support of this billing rate. (See id.) It appears that the highest fee ever awarded in this District was on an unopposed application for a rate of $500 for an attorney with substantial litigation experience in connection with an unopposed fee application. See Muhammed v. Martoccio, No. 3:06-cv-1137, 2010 WL 3718560, at *3-4 (D.Conn. Sept. 13, 2010).
Defendant cites to Serricchio v. Wachovia Securities, LLC, 706 F.Supp.2d 237 (D.Conn.2010) to argue that Plaintiffs fee should be reduced. In Serricchio, this Court reduced a requested hourly rate of $550 to $465. At the time, $465 per hour represented the highest fee awarded in the district by $65 per hour, and was based on the attorney’s “extensive experience, high reputation, and remarkably successful results.” Id. at 255. However, more than two years have elapsed since Serricchio was decided. As described in the affidavit of Attorney Richard Renner (see Attachments to Pl.’s Mem. Supp.), Attorney Goetsch is undeniably a leading specialist in tfie law governing railroad employees’ rights, and his longstanding and highly developed practice makes him more efficient, creative, and effective for his railroad employee clients than an attorney of similar trial experience in federal litigation but without the benefits of his specialization. Based on Attorney Goetsch’s experience, his success in this unique case, and the case law since Serricchio evidencing a rise in the prevailing market rate, the Court finds that an hourly rate of $525 for his work on this case is reasonable and fulfills the purpose of federal fee shifting statutes to incentivize capable attorneys to take on meritorious cases under the FRSA. Similarly, based on Attorney Perry’s twelve years of litigation experience and federal clerkship, the Court finds that an hourly rate of $375 for his work on this case is reasonable. See Serricchio, 706 F.Supp.2d at 255-56 (awarding rate of $410 per hour to partner with nineteen years of experience and $300 per hour to associate with five years of experience and a federal clerkship).
B. Reasonableness of Time Expended
Plaintiff seeks fees for 345.65 hours1 of work performed by Attorney Goetsch and for 311.752 hours of work performed by Attorney Perry. Defendant’s objections to the amount of time expended in connection with this action fall generally into three categories: (1) Defendant objects to vague and duplicative time entries by Attorney Perry, (2) Defendant objects to the fees sought in connection with Plaintiffs expert witness; and (3) Defendant objects to time spent pursuing Plaintiffs FELA claim, which is a non-fee-shifting claim.3
*157
1. Attorney Perry’s Hours
Defendant claims that some of Attorney Perry’s time entries were excessive and duplicative of work performed by Attorney Goetsch. To the extent that Defendant objects to Attorney Perry’s attendance at the pre-trial conference, the Court requires that the attorneys who will try the case appear at the final pretrial conference. (See Trial Preferences, http://www. ctd.uscourts.gov/sites/default/files/forms/ Trial% OPreferences.pdf.) Furthermore, it is not unreasonable that two attorneys would be required to try a first-of-its-kind case, and a second chair can add value to the presentation of a case in taking notes, handling unanticipated exhibit needs, and reviewing testimony to inform and enhance the primary counsel’s examination of witnesses and preparation of an effective closing argument. Therefore, the Court does not find that Attorney Perry’s time entries for the pre-trial conference and the trial were duplicative. Defendant also objects that Attorney Perry’s work on the Joint Trial Memorandum and the bench memo on the admissibility of agency reports was duplicative of work performed by Attorney Goetsch. It is not unreasonable that Attorneys Goetsch and Perry would approach brief writing as a collaborative process and two attorneys can work on separate sections of a brief without necessarily duplicating work. However, Attorney Perry spent thirty-two hours drafting the joint trial memo, which the Court finds to be excessive. Thus, the court will reduce this figure by fifty percent, and subtract a total of sixteen hours from Attorney Perry’s fee request.
Defendant also objects to several of Attorney Perry’s entries on the basis that they are vague block entries. “Block billing” — i.e., billing a large number of hours for multiple tasks — does not permit the Court to determine actual time spent on particular tasks, nor whether two lawyers are duplicating each other. See Green v. City of New York, 403 Fed.Appx. 626, 630 (2d Cir.2010) (affirming district court’s application of hours reduction due to pervasive block billing in time entries submitted by counsel and concluding that the practice raised questions regarding the reasonableness of the entries). For example, Attorney Perry’s entry from September 22, 2011 which states “review file to prepare for deposition; OC with George Gavalla” (see Ex. 1 to PL’s Mem. Supp.) is overly vague and does not parse out the duration of each task. Moreover, several of his entries utilize the term “review file,” a phrase which “do[es] not provide an adequate basis upon which to evaluate the reasonableness of the services and hours expended on a given matter.” See Valley Housing, 2012 WL 1077848, at *8. Thus, the Court will exclude Attorney Perry’s entries from September 6, 2011, September 15, 2011, and September 22, 2011 as vague, for a total reduction of 17.7 hours. Furthermore, the Court will impose a ten-percent reduction to all of Attorney Perry’s hours in light of. his use of block billing. See id. (imposing an across-the-board reduction in light of counsel’s use of vague block entries).4
Accordingly, Attorney Perry’s hours will be reduced to 245.52 hours.5
*158
2. Expert Witness Fees and Costs
Defendant argues that because the Court ultimately limited the scope of the testimony by Plaintiffs expert witness George Gavalla, the time spent preparing this witness’s testimony and expert report, and Plaintiffs claim for expert witness costs should be substantially reduced. However, Defendant cites no case law in support of the proposition that. a court should apportion fees related to an expert witness based on the scope of his or her testimony, and offers no principled method by which the Court could apportion these costs and fees between the excluded testimony and the admitted testimony. Furthermore, the language of the FRSA does not limit the recovery of expert witness fees in any way. See 49 U.S.C. § 20109(e)(2)(C) (“[R]elief ... shall include ... compensatory damages, including compensation for any special damages sustained as a result of the discrimination, including litigation costs, expert witness fees, and reasonable attorney fees.”) Even in light of the Court’s decision to limit the scope of his testimony, Mr. Gavalla’s testimony at trial was crucial to Plaintiffs case. Therefore, the Court will not limit the attorneys’ fees or witness costs associated with Mr. Gavalla.
3. FELA Claim
Finally, Defendant argues that Plaintiff may not recover for any fees incurred in relation to his FELA claim because the FELA is not a fee-shifting statute. “When calculating' a lodestar, the number of hours spent on a case should include only those hours spent on claims eligible for fee-shifting.” Millea, 658 F.3d at 168. “Hours spent solely on ... statutory claims not subject to fee-shifting must be excluded to reflect the default rule that each party must pay its own attorney’s fees and expenses.” Id. (internal quotation marks omitted). However, “[h]ours spent on legal work that furthers both fee-shifting and non-fee-shifting claims may be included in the lodestar calculation because they would have been, expended even if the plaintiff had not included non-fee-shifting claims in his complaint.” Id. at 168 n. 4. Here Plaintiffs FELA and FRSA claims were inextricably intertwined in that they both relied on the same core facts relating to the circumstances of Plaintiffs injury and Defendant’s response to that injury. Defendant does not identify any exhibit or witness at trial that is attributable solely to Plaintiffs FELA claim other than the testimony of John Ella. However, Mr. Ella’s testimony helped establish one of the elements of Plaintiffs FRSA claim— that Defendant knew Plaintiffs injury was “work related.” Given that both claims depended on the same evidence at trial, the Court finds that all of the fees incurred in this matter would necessarily have furthered Plaintiffs FRSA claims, and thus the Court will not apportion the requested fees between the FELA and FRSA claims.
C. Presumptively Reasonable Fee
Taking into account the Court’s adjustment of hours reasonably expended, the Court calculates the presumptively reasonable fee via the lodestar method as follows:
Reasonable Hours Reasonable
*159_Attorney_Fee_Requested Hours Awarded Fee Awarded
_Goetsch $525_345.65_345.65_$181,466.25
_Perry_$375_311.75_245.52_$ 92,070.00
Total_$273,536.25
D. Final Fee Award
Plaintiff argues that given the novelty of the FRSA and his nationally recognized specialization in train law, this case represents the rare circumstance where a rate enhancement is warranted, and requests that the lodestar amount be adjusted upward via an enhancement of Attorney Goetsch’s hourly rate by thirty percent to $715 per hour. In Perdue, the Supreme Court recognized that enhancement may be proper “where the method used in determining the hourly rate employed in the lodestar calculation does not adequately measure the attorney’s true market value.” 130 S.Ct. at 1674. In such a case, “the trial judge should adjust the attorney’s hourly rate in accordance with specific proof linking the attorney’s ability to a prevailing market rate.” Id. As evidence linking Attorney Goetsch to this enhanced rate, Plaintiff offers the affidavit of Attorney Renner, which states that Attorney Goetsch’s practice “transcends his local market and competes on a nationwide basis.” (See Attachments to Pl.’s Mem. Supp.) To the extent that this argument is based on the novelty and complexity of the FRSA, and Attorney Goetsch’s exceptional performance in being the first attorney to try a FRSA case to a successful verdict, the Supreme Court has rejected these factors as justification for an enhancement because they are already subsumed in the lodestar calculation. See Perdue, 130 S.Ct. at 1673. Furthermore, as this Court reasoned in Serricchio, because this was the first FRSA case, “a savvy client would recognize potential leverage to negotiate a lower fee from the reputational benefits that would accrue to [Attorney Goetsch] for taking on this representation.” 706 F.Supp.2d at 255. While Attorney Goetsch has already attracted a large railroad employee client base, his victory in this case provides the potential for broader referrals beyond his current client list and their geographical distribution, and enhances his gravitas in settlement negotiations. The Court has already considered Attorney Goetsch’s- considerable experience and reputation, in addition to his success in this case, in setting a reasonable hourly fee as high as it did as a part of the lodestar calculation. Therefore the Court concludes that no further enhancement of this rate is warranted.
With the adjustments made as to the reasonableness of hours expended, the Court does not find that any other appropriate adjustments are warranted. Accordingly, the Court awards Plaintiff an attorney fee of $273,536.25, and costs in the amount of $14,425.03.
II. Conclusion
For the reasons discussed above, Plaintiffs motion [Doc. # 130] for costs and fees is GRANTED in part. Defendant’s Motion [Doc. # 141] to Quash is GRANTED. The Court awards $273,536.25 in attorneys’ fees and $14,425.03 in costs, for a total .of $287,961.28, and directs that the Judgment be amended accordingly.
IT IS SO ORDERED.
. This amount represents the 330.85 hours Plaintiff sought in his original petition and an additional 14.8 hours sought in connection with the preparation of Plaintiff's reply to Defendant's objection to this petition.
. In his reply, Plaintiff agreed that Attorney Perry's hours should be reduced from 308.75 to 296.75, and thus this amount represents the 296.75 Plaintiff seeks in connection with his original petition, an additional 9.75 hours sought in connection with the preparation of Plaintiffs reply to Defendant's objection to this petition, and an additional 5.25 hours sought in connection with the preparation of a subpoena for Defendant’s billing records.
. Defendant also submitted several objections, described as "miscellaneous,” without citing specific case law in support of these reductions. Plaintiff agreed that several of these reductions were proper, but to the extent that there remains a request for additional “miscellaneous” reductions, the Court is unpersuaded by Defendant’s arguments.
. In response to Defendant's objection to this fee petition, relying on Serricchio, Plaintiff subpoenaed defense counsel’s billing records. Defendant moves [Doc. # 141] to quash the subpoena. ■ Here, unlike Serricchio, Defendant raised detailed objections to specific billing entries based on well-established law in this Circuit. Thus, the Court concludes that defense counsel's billing records are not necessary to rule on Defendant's objections, and Defendant's motion to quash is granted. The Court will exclude the 5.25 hours Attorney Perry seeks to recover for the time spent drafting a response to the motion to quash.
. This figure represents the following calculations: A total of 38.95 hours are subtracted from the original request of 311.75 hours for *158excessive billing on the joint trial memo, vague time entries, and time spent on the motion to quash, resulting in a total 272.8 hours. This figure is further reduced by ten percent (or 27.28 hours) as a result of Attorney Perry’s use of vague, block entries, resulting in a final total of 245.52 hours. | 01-03-2023 | 11-26-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/33482/ | United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT December 10, 2003
Charles R. Fulbruge III
Clerk
No. 03-10186
Conference Calendar
UNITED STATES OF AMERICA,
Plaintiff-Appellee,
versus
GRAYSON GUADALUPE GRIFFIN,
Defendant-Appellant.
--------------------
Appeal from the United States District Court
for the Northern District of Texas
USDC No. 4:02-CR-00085-ALL-Y
--------------------
Before DAVIS, EMILIO M. GARZA, and DENNIS, Circuit Judges.
PER CURIAM:*
The Federal Public Defender, appointed to represent Grayson
Guadalupe Griffin, has moved for leave to withdraw and has filed
a brief pursuant to Anders v. California, 386 U.S. 738 (1967). A
copy of counsel’s motion and brief were sent to Griffin, but he
has not filed a response. Our review of the brief and of the
record discloses no nonfrivolous issue for appeal. Accordingly,
the motion for leave to withdraw is GRANTED, counsel is excused
*
Pursuant to 5TH CIR. R. 47.5, the court has determined
that this opinion should not be published and is not precedent
except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
No. 03-10186
-2-
from further responsibilities, and the APPEAL IS DISMISSED. See
5TH CIR. R. 42.2. | 01-03-2023 | 04-25-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3843021/ | DECISION OF DISMISSAL
Plaintiffs filed their Complaint on June 8, 2009, challenging Defendant's Notice of Determination and Assessment. After reviewing Plaintiffs' appeal, Defendant filed its Answer on August 10, 2009, and agreed that Plaintiffs had paid the taxes due, but stated that penalty and interest would need to be "dealt with" by the Department of Revenue. There being no disagreement over which the court has jurisdiction, the matter is ready for dismissal.
Now, therefore,
IT IS THE DECISION OF THIS COURT that this matter is dismissed and that the issue of penalty and interest referred to Defendant.
Dated this ___ day of August 2009.
If you want to appeal this Decision, file a Complaint in the RegularDivision of the Oregon Tax Court, by mailing to: 1163 State Street,Salem, OR 97301-2563; or by hand delivery to: Fourth Floor, 1241 StateStreet, Salem, OR.
Your Complaint must be submitted within 60 days after the date of theDecision or this Decision becomes final and cannot be changed.
This document was signed by Magistrate Jeffrey S. Mattson on August27, 2009. The Court filed and entered this document on August 27, 2009. *Page 1 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3851805/ | The question on this appeal is the value of the shares of stock of the Union Trust Company of Pittsburgh for the purpose of taxation for the year 1935 in accordance with the Act of June 13, 1907, P. L. 640, as amended by the Acts of July 11, 1923, P. L. 1071, May 7, 1927, P. L. 853, and May 31, 1933, P. L. 1132. The Department of Revenue found the market value of the capital, surplus and undivided profits of the company to be $123,671,512 and the taxable value of the shares $110,560,929, and fixed the tax at $552,804. On appeal to the Dauphin County Court the taxable value of the shares was reduced to $23,660,919, and the tax to $118,304, There were no disputed appraisements of assets or liabilities, the difference between the results reached by the department and the court being accounted for wholly by a difference in the treatment of so-called "exempt" securities.1 The Dauphin County Court allowed deductions of $13,110,583 for shares of stock of Farmers Deposit National Bank and Mellon National Bank, $2,145,000 for shares of stock of Federal Reserve *Page 300
Bank of Cleveland, $9,031,694 for shares of stock of Farmers Deposit Trust Company, Union Fidelity Title Insurance Company and Union Savings Bank of Pittsburgh, $75,657,567 for United States bonds and notes and other federal securities, and $65,749 for shares of stock of Gimbel Brothers, Inc., and Pennroad Corporation, all of which securities formed part of the invested assets of the Union Trust Company. Only the first item, that of the national bank stocks, had been allowed as a deduction by the Department of Revenue. The Commonwealth appeals from the judgment of the Dauphin County Court, its contention being that the company did not show, as to some of these items, that they represented investments of its capital stock, surplus and undivided profits as distinguished from investments of moneys received by it on deposit, and that therefore no deductions of such items should have been allowed.
Notwithstanding all the litigation which has involved construction of the Act of 1907 and its amendments — four cases in this court2 and two of these in the Supreme Court of the United States3 — confusion evidently persists as to the reason for using a method of apportionment to ascertain the deductions allowable for exempt securities in accordance with the provisions of this tax legislation.
The Act of 1907 provided that the shares of the title companies and trust companies therein referred to should be assessed for taxation "at the rate of five mills upon each dollar of the actual value thereof, the actual value of each share of stock to be ascertained and fixed by adding together the amount of capital stock paid in, the surplus and undivided profits, and dividing this *Page 301
amount by the number of shares." This act gave rise to no particular difficulty either of interpretation or enforcement, since it required nothing more than an appraisement of the assets and liabilities of the taxpaying corporation. The amending acts, however, of 1923, 1927, and 1933 introduced into the situation the element of exempt securities, the shares being now assessed for taxation "at the rate of five mills upon each dollar of the actual value thereof; the actual value of each share of stock to be ascertained and fixed by adding together so much of the amount of capital stock paid in, the surplus, and undivided profits as is not invested in shares of stock of corporations liable to pay to the Commonwealth a tax on shares; or as is not invested in such portion of the capital stock of corporations liable to pay to the Commonwealth a capital stock tax as the capital stock of such corporation employed within this Commonwealth and liable to a capital stock tax bears to the total capital stock of such corporation; or as is not invested in such portion of the capital stock of corporations specifically relieved under the laws of this Commonwealth from the payment of a capital stock tax as the capital stock of such corporation employed within this Commonwealth and relieved from the payment of a capital stock tax bears to the total capital stock of such corporation, — and dividing this amount by the number of shares."4
By this amendatory legislation two problems were created: (1) Must a deduction be made from the tax base for national bank stocks and United States bonds and notes and other federal securities owned by the company? (2) How can it be ascertained which of the securities held by the company are investments of capital stock, surplus and undistributed profits and which are investments of moneys received from depositors? *Page 302
The first of these questions was settled in the twoSchuylkill Trust Company cases — 315 Pa. 429, reversed296 U.S. 113; 327 Pa. 127, affirmed 302 U.S. 506 — it being held that national bank stocks owned by the company could not be included in the base or measure of a tax to its shareholders because these stocks had already been taxed to the company as owner under the Act of July 15, 1897, P. L. 292, and its amendments, as permitted by R. S. 5219 as amended, U.S.C.A. title 12, section 548; but in regard to federal securities, since the tax under the Act of 1907 was on the shares and not on the capital stock of the company, the only requirement was that they be not discriminated against but be given the same exemption accorded non-federal securities.
The second of the questions raised by the amendments of the Act of 1907 is the one with which we are now confronted. Assuming that a trust company has in its portfolio stocks of corporations which are exempt under those amendments, and also federal securities which must be given the same exemption, how is it to be determined whether the investments in such securities are of the capital stock, surplus, and undivided profits or of the deposits? If the permanent investments, such as real estate, mortgages, stocks and bonds as distinguished from short-term loans and commercial paper, are less in amount than the capital stock, surplus and undivided profits, they may safely be assumed to be investments of the company's net assets, since it is more likely that the company would invest its own resources in such securities than that it would so invest deposits payable on demand. A real problem arises, however, when the permanent investments exceed the amount of the capital, surplus and undivided profits, because it then necessarily follows that some unknown portion of the deposits has been invested in such securities. Even in that event it may be possible to prove in some instances that certain securities were in fact investments *Page 303
of capital, surplus or undivided profits, and, if such securities be exempt, they would then be properly deductible from the company's net assets and thereby excluded from the tax base. Thus in the present case the Dauphin County Court found that the evidence definitely established that the stocks of the national banks, Federal Reserve Bank of Cleveland, Farmers Deposit Trust Company, Union Fidelity Title Insurance Company and Union Savings Bank of Pittsburgh were all capital stock investments, and therefore, in computing the tax base, the court deducted them wholly from the capital stock, surplus and undivided profits. The Commonwealth does not now complain of those deductions. There was no such proof, however, in regard to the stock of Gimbel Brothers, Inc., and Pennroad Corporation, which together had a market value of $523,312 (of which $178,227 was liable to tax in Pennsylvania), and United States bonds and notes and other federal securities, which had a market value of $192,865,200, and here a method of apportionment was adopted by the court5 to which the Commonwealth now objects, although it finds no fault with the terms of the apportionment formula if the principle of apportionment is held to be proper.6
What is the theory underlying the use of the apportionment formula? It is an error to suppose, as the Commonwealth apparently does, that a trust company has two distinct funds, one made up of its net assets and the other of moneys received from depositors. The amount of its net assets, constituting its capital, surplus and undivided profits, is a bookkeeping balance obtained by subtracting its liabilities from its gross assets; it is the shareholders' equity in the assets of the *Page 304
company. Ordinarily, investments are made indiscriminately from the company's general or gross assets, and therefore any specific item of securities cannot be allocated as an entirety, in the absence of actual proof justifying such allocation, to either the company's net assets or its investments of deposits. When there is deducted from the gross assets the amount owed to depositors, and the net assets are thereby ascertained, it is only the latter, not the investments of deposited moneys, which constitute the tax base.7 It must therefore be determined how much of the exempt securities remain in the net assets after the deposits (and therefore all investments of the deposits) have been thus deducted from the total assets. In other words, such exempt securities as were investments of deposits having been excluded by the deduction of the deposits, it is necessary to purge the net assets of the remainder of the exempt securities. Since, however, it would ordinarily be impossible for either the Commonwealth or the company to demonstrate what amount of exempt securities has been thus excluded and what amount remains, it is necessary, if the provisions of the taxing statute are to be enforced, to adopt the presumption — normally no doubt corresponding to the fact — that the exempt securities are spread between the net assets and the deposits in the same proportion as all the permanent investments are so spread, it being assumed, for the reason previously mentioned, that where the permanent investments exceed the total of capital, surplus and undivided profits these net assets are wholly invested in the permanent investments and only the excess of the permanent investments represents investments of deposits. The apportionment formula is merely the method by which this presumption is given practical *Page 305
effect. In general, it ascertains the ratio which the net assets bear to the total permanent investments and applies that ratio to the exempt securities.8 It makes it reasonably certain that no exempt securities are included in the tax base, but, on the other hand, does not result in any improper diminution of that base. If the Commonwealth's contention were accepted that the company must affirmatively show which of its holdings were investments of its net assets, none of the deductions required by the taxing statute could be made in most instances, because, as already stated, investments are ordinarily made by the company from all of its funds and not from any segregated portion thereof.
Not only is the apportionment method adopted in this case required in order to implement the statute under which the tax is levied, but it received the sanction of the Department of Revenue itself over a course of years extending from the time of the adoption of the amendments of the Act of 1907 to the year 1934. It has also been approved several times by this court. In Commonwealth v. Hazelwood Savings Trust Co.,271 Pa. 375, 114 A. 368, the court below held that the exempt securities should be deducted from the amount of capital stock, surplus and undivided profits even though it had not been shown that they represented investments only of net assets. On appeal the Commonwealth, contrary to its position in the present case, urged that the apportionment method should be approved by this court, *Page 306
and its appeal was sustained. True, it was said (p. 378): "Since the company did not prove its purchase of these securities out of capital stock account, the Commonwealth might, perhaps, have refused to allow any deduction whatever," but this was merely a suggestion to the company that it ought to be satisfied as the Commonwealth might have raised the question thus indicated, as to which the court expressed no opinion. In Commonwealth v. Schuylkill Trust Co., 315 Pa. 429,173 A. 309, the court below adopted the method of apportionment approved in the Hazelwood case, and this time it was the trust company which appealed, claiming that the exempt securities should have been deducted wholly from the value of the capital stock, surplus and undivided profits. This contention was rejected. In Commonwealth v. Provident Trust Co. ofPhiladelphia, 319 Pa. 385, 180 A. 16, the court below again applied the apportionment method and the Commonwealth appealed, taking the position that no deduction of exempt securities should have been allowed because the company had not affirmatively shown that such securities were investments of capital, surplus and undivided profits. This court affirmed the action of the court below, but on the theory that, while the company had the burden of showing that the exempt securities represented invested capital, surplus or undivided profits, the burden was sustained if the securities in question appeared "inherently as a part of the capital stock structure" or were "earmarked and set up as made out of the capital account". InCommonwealth v. Schuylkill Trust Co., 327 Pa. 127, 193 A. 638, the apportionment formula adopted by the court below was not attacked, the only issue being the proper treatment to be given to federal securities and shares of national bank stocks. In the opinion of the court (p. 134) the question suggested in theHazelwood case was again referred to. That question — whether, if the company failed to establish that the exempt securities were investments of net assets, the Commonwealth might refuse to allow any deduction whatever — is raised flatly in the *Page 307
present case and we now hold that it is not be be solved by fixing the burden of proof, because such burden placed on either party would make it impossible to carry out the provisions of the taxing statute, but that, in the absence of proof establishing the identity of the funds or accounts invested in the exempt securities, the apportionment method employed in this case is the proper one by which the tax base is to be determined.
Gimbel Brothers, Inc., and Pennroad Corporation are foreign corporations which are liable to pay to the Commonwealth, not a capital stock tax as such, but a franchise tax under the Act of May 16, 1935, P. L. 184. As the Act of 1907 and its amendments do not provide for an exemption of stocks of corporations liable to pay a franchise tax eo nomine, the Commonwealth argues that no deduction should have been allowed for the stocks of these two corporations. While, inCommonwealth v. Columbia Gas Electric Corp., 336 Pa. 209,8 A.2d 404, it was pointed out that the tax under the Act of 1935 is not a capital stock tax, being levied on a franchise or privilege and not on property or capital of the corporation, that case did not impair the ruling in Arrott's Estate, 322 Pa. 367,185 A. 697, that there was such a close identity between the capital stock tax and the franchise tax that the owners of shares of stock in foreign corporations which paid the franchise tax were not obliged to pay a personal property tax on such shares, it being the general policy of the State to avoid double taxation. If, in accordance with Arrott's Estate, an individual holder of shares of stock of a foreign corporation paying a franchise tax under the Act of 1935 is not obliged to pay a personal property tax on such shares, it would seem inconsistent and illogical to hold that the stockholders of a trust company owning such shares should be subjected to tax because of such ownership. The payment of the franchise tax by foreign corporations is, as far as the principle here involved is concerned, analogous to the payment of the capital stock tax by domestic corporations, and double taxation would result *Page 308
in the one case as in the other if the shares were not excluded from the tax base to the extent provided by the Act of 1907. It is not to be presumed that such double taxation was intended by the legislature. It is the character rather than the nominal designation of the franchise tax which is here controlling.
Judgment affirmed.
1 It is not strictly accurate to speak of "exempt" securities, because none of the securities held by the company is directly taxed. Certain securities are exempt only in the sense that they are excluded in determining the taxable value of the shares.
2 Commonwealth v. Hazelwood Savings Trust Co., 271 Pa. 375,114 A. 368; Commonwealth v. Schuylkill Trust Co., 315 Pa. 429,173 A. 309; Commonwealth v. Provident Trust Co. ofPhiladelphia, 319 Pa. 385, 180 A. 16; Commonwealth v.Schuylkill Trust Co., 327 Pa. 127, 193 A. 638.
3 Schuylkill Trust Co. v. Pennsylvania, 296 U.S. 113; SchuylkillTrust Co. v. Pennsylvania, 302 U.S. 506.
4 By the Act of July 28, 1936, (Spec. Sess.) P. L. 73, the exemptions introduced by the acts amending the Act of 1907 were abolished and the tax base restored as in the original act.
5 The calculation of the deduction for these securities by the application of the formula employed by the court will be found in 50 Dauph. 266, 299-302.
6 Because the Commonwealth is not questioning the treatment given by the court to the item of "appreciation in United States securities" we express no opinion in regard thereto.
7 Thus in the present case the gross assets were appraised at a market value of $383,294,012. From this amount were deducted liabilities of $259,622,500, leaving $123,671,512 as the net assets of the company constituting its capital, surplus and undivided profits.
8 Stated in greater detail, the formula is as follows: A fraction is constructed of a numerator consisting of the capital, surplus, undivided profits and reserves, determined by the book value of the assets, less the book value of those shares, if any, for which deduction has been made wholly therefrom, and a denominator consisting of the book value of the permanent investments, less the book value of those shares, if any, for which deduction has been similarly made. This fraction is multiplied by that portion of the market value of the exempt shares which is liable to pay a tax to the Commonwealth or which is relieved by the laws of the Commonwealth from the payment of a tax. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4061194/ | ACCEPTED
01-15-00230-CV
FIRST COURT OF APPEALS
HOUSTON, TEXAS
7/8/2015 3:46:53 PM
CHRISTOPHER PRINE
CLERK
No. 01-15-00230-CV
In The Court Of Appeals 1st COURT FILED IN
OF APPEALS
HOUSTON, TEXAS
For The First District of Texas
7/8/2015 3:46:53 PM
Houston, Texas CHRISTOPHER A. PRINE
Clerk
GEORGE DAVIS, MD, ANTENEH ROBA, MD, LEVON VARTANIAN, MD,
WOODROW DOLINO, MD, NORTHWEST HOUSTON EMERGENCY SPECIALIST
GROUP, PLLC, ESG MD, PLLC AND ESG MLP, LLC,
Appellants
V.
ALAN BENTZ, MD,
Appellee
FROM THE 190TH JUDICIAL DISTRICT COURT, HARRIS COUNTY, TEXAS
CAUSE NO. 2012-44569
HONORABLE JUDGE KERRIGAN, PRESIDING
APPELLEE’S BRIEF
NORTON ROSE FULBRIGHT US LLP
Andrew Price
State Bar No. 24002791
andrew.price@nortonrosefulbright.com
Rachel Roosth
State Bar No. 24074322
rachel.roosth@nortonrosefulbright.com
James Hartle
State Bar No. 24082164
jim.hartle@nortonrosefulbright.com
1301 McKinney, Suite 5100
Houston, Texas 77010-3095
Telephone: (713) 651-5151
Telecopier: (713) 651-5246
Counsel for Appellee Alan Bentz, M.D.
CORRECTION REGARDING IDENTITY OF COUNSEL
Appellant’s Joint Brief provided the former name of the law firm representing
Appellee: Fulbright & Jaworski, LLP. Its current and correct name is Norton Rose
Fulbright US LLP.
The proper information of counsel for Appellee Alan Bentz, M.D. is as follows:
Andrew Price
andrew.price@nortonrosefulbright.com
Rachel Roosth
rachel.roosth@nortonrosefulbright.com
James Hartle
jim.hartle@nortonrosefulbright.com
NORTON ROSE FULBRIGHT US LLP
1301 McKinney, Suite 5100
Houston, Texas 77010-3095
Tel: (713) 651-5151
Fax: (713) 651-5246
54069386.3 - ii -
TABLE OF CONTENTS
CORRECTION REGARDING IDENTITY OF COUNSEL .................................. II
TABLE OF CONTENTS ......................................................................................... V
STATEMENT OF THE CASE ............................................................................ VIII
STATEMENT REGARDING ORAL ARGUMENT ............................................. X
STATEMENT OF ISSUES PRESENTED............................................................ XI
STATEMENT OF FACTS .......................................................................................1
SUMMARY OF THE ARGUMENT .......................................................................8
I. Standard of Review ............................................................................13
II. Applying Texas law: the Award must be upheld ...............................14
A. Without a complete record of the arbitration proceedings,
Appellants cannot overcome the presumption in favor of
upholding the Award................................................................15
1. The issues decided by the Arbitrator were
submitted in the arbitration, and without a
complete record, the trial court had to presume that
they were submitted .......................................................18
2. The evidence supported the damages awarded, and
without a complete record, the trial court had to
presume that it did .........................................................19
3. Appellants conceded the value of Dr. Bentz’s
membership interest, and without a complete
record, the trial court could not find otherwise ............. 22
B. The Arbitrator properly exercised his broad authority
under Section 9.02 to decide all disputes other than those
decided under Section 9.01 ......................................................24
1. Section 9.02 gave the Arbitrator authority to
decide all disputes related to the Company
Agreement other than disputes resolved pursuant
to Section 9.01, and none of the disputes the
Arbitrator decided were, or could have been,
decided under Section 9.01 ............................................26
54069386.3 - iii -
2. The Arbitrator had authority to decide the
appropriate remedies for the disputes submitted to
him under Section 9.02 ..................................................28
a. There was no requirement that the parties
agree to the remedies selected by the
Arbitrator .............................................................29
b. Dr. Bentz did seek to recover the Fair
Market Value of his interest, but regardless,
this was an issue for the Arbitrator to decide ...... 32
3. The Award was rationally inferable from the
Agreement, as shown by the Arbitrator’s well-
reasoned discussion in the Award .................................33
a. The essence test does not allow the non-
prevailing party to retry the dispute ....................34
b. The Arbitrator correctly determined that
Dr. Bentz was still a member after expulsion .....35
C. The Arbitrator did not award a double recovery, but even
if he had, it would not be grounds for vacatur .........................39
1. Double recoveries do not warrant vacatur .....................39
a. Prohibiting double recoveries is not so
fundamental a policy that it would outweigh
public policy in favor of upholding
arbitration awards ................................................40
b. Violating public policy is not a ground for
vacatur under the Federal Arbitration Act .......... 43
2. The Award compensates Dr. Bentz for separate
injuries and therefore does not grant a double
recovery .........................................................................45
D. Even if the Court were to vacate the Award, it could not
order the modification that Appellants request ........................47
CONCLUSION .......................................................................................................49
CERTIFICATE OF SERVICE ...............................................................................51
CERTIFICATE OF COMPLIANCE ......................................................................52
54069386.3 - iv -
APPENDIX
1. The Company Agreement (C.R. 112–36)
2. The Award (signed October 15, 2014) (C.R. 1488–92)
3. The Judgment (signed December 9, 2014) (C.R. 1794–95)
4. Order Confirming an Arbitration Award (signed December 9, 2014)
(C.R. 1796)
5. Order Denying Application for Partial Vacatur or Modification of
Arbitration Award (signed December 9, 2014) (C.R. 1797)
6. Order Denying Individually Named Respondents’ Motion to Partially
Vacate or Vacate Arbitration Award or in the Alternative, Motion to Modify
Award (signed December 9, 2014) (C.R. 1798).
7. TEX. BUS. ORGS. CODE § 101.106 (West 2015)
8. TEX. CIV. PRAC. & REM. CODE § 171.087 (West 2015)
9. TEX. CIV. PRAC. & REM. CODE § 171.090 (West 2015)
10. 9 U.S.C. § 9 (West 2015)
11. Excerpts from Dr. Bentz’s Prehearing Brief
54069386.3 -v-
INDEX OF AUTHORITIES
CASES:
Ancor Holdings, L.L.C. v. Peterson, Goldman & Villani, Inc.,
294 S.W.3d 818 (Tex. App.—Dallas 2009, no pet.)………..…….……34–35
Anzilotti v. Gene D. Liggin, Inc.,
899 S.W.2d 264 (Tex. App.—Houston [14th Dist.] 1995, no writ)……13–15
Barton v. Fashion Glass and Mirror, Ltd., 321 S.W.3d 641
(Tex. App.—Houston [14th Dist.] 2010, no pet.)……………………..…..24
Black v. Shor, 443 S.W.3d 154
(Tex. App.—Corpus Christi 2013, pet. denied)..................……………41, 43
Brockman v. Tyson, No. 01-03-01335-CV, 2005 WL 2850128
(Tex. App.—Houston [1st Dist.] Oct. 27, 2005, pet. denied)..…….18–19, 33
Burlington Resources Oil & Gas Co., LP v. San Juan Basin Royalty Trust,
249 S.W.3d 34 (Tex. App.—Houston [14th Dist.] 2007, pet. denied)....30–31
CC Williams Construction Co., Inc. v. Rico, No. 09-10-00472-CV,
2011 WL 2135074 (Tex. App.—Beaumont May 19, 2011, no pet.).….20–22
Centex/Vestal v. Friendship West Baptist Church, 314 S.W.3d 677
(Tex. App.—Dallas 2010, pet. denied)…….....................…..……..17–18, 24
City of Waco v. Kelly, 309 S.W.3d 536 (Tex. 2010)……………………………..48
CVN Group, Inc. v. Delgado, 95 S.W.3d 234 (Tex. 2002)………………40–42, 44
Executone Info Sys., Inc. v. Davis, 26 F.3d 1314 (5th Cir. 1994)…………….33–34
Forest Oil Corp. v. El Rucio Land and Cattle Co., Inc., 446 S.W.3d 58
(Tex. App.—Houston [1st Dist.] July 24, 2014, pet. filed)………………..24
Fortune v. Killebrew, 23 S.W. 172 (Tex. 1893)………………………………30–31
54069386.3 - vi -
GJR Mgmt. Holdings, L.P. v. Jack Raus, Ltd., 126 S.W.3d 257
(Tex. App.—San Antonio 2003, pet. denied)……………………….…13, 17
Goldman v. Buchanan, No. 05-12-00050-CV, 2013 WL 1281744
(Tex. App.—Dallas Mar. 21, 2013, no pet.)...............…………………….16
Goodyear Tire & Rubber Co. v. Sanford, 540 S.W.2d 478
(Tex. Civ. App.—Houston [14th Dist.] 1976, no writ)……..…………42, 44
Gulf Oil Corp. v. Guidry, 327 S.W.2d 406 (Tex. 1959)…………………30–31, 48
Hall St. Assocs., L.L.C. v. Mattel, Inc., 522 U.S. 576 (2008)…………………….43
IQ Holdings, Inc. v. Villa D’Este Condominium Owners’ Ass’n Inc.,
__ S.W.3d. __, No. 01-11-00914-CV, 2014 WL 982844
(Tex. App.—Houston [14th Dist.] Mar. 1, 2014, no pet.).…........…….14
Jack B. Anglin Co., Inc. v. Tipps, 842 S.W.2d 266 (Tex. 1992)………………….26
Kline v. O’Quinn, 874 S.W.2d 776 (Tex. App.—Houston
[14th Dist.] 1994, writ denied)……………………..14–15, 18–19, 24, 32, 47
Lee v. Daniels & Daniels, 264 S.W.3d 273
(Tex. App.—San Antonio 2008, pet. denied)…..…………….………..42, 45
Lee v. El Paso County, 965 S.W.2d 668
(Tex. App.—El Paso 1998, pet. denied)……………..................….42, 44–45
Mega Builders, Inc. v. Paramount Stores, Inc. No. 14-14-00744-CV,
2015 WL 3429060 (Tex. App.—Houston [14th Dist.]
May 28, 2015, no pet. h.)………………………………………………21–22
Nafta Traders Inc. v. Quinn, 339 S.W.3d 84 (Tex. 2011)……………………15–17
Petroleum Analyzer Co. LP v. Olstowski, No. 01-09-00076-CV,
2010 WL 2789016 (Tex. App.—Houston [1st Dist.] 2010, no pet.)………44
Prudential Sec. Inc. v. Marshall, 909 S.W.2d 896 (Tex. 1995)………………….24
54069386.3 - vii -
Rapid Settlements, Ltd. v. Symetra Life Ins. Co.,
234 S.W.3d 788 (Tex. App.—Tyler, no pet.)………………….…..42–43, 45
Roe v. Ladymon, 318 S.W.3d 502 (Tex. App.—Dallas 2010, no pet.)…...29, 41, 43
Royce Homes, L.P. v. Bates, 315 S.W.3d 77
(Tex. App.—Houston [1st Dist.] 2010, no pet.)……………….……….42–44
Schuster v. Wild, No. 13-13-00474-CV, 2014 WL 3804834
(Tex. App.—Corpus Christi March 5, 2015, pet. denied).………….….16–17
Smith v. Gladney, 98 S.W.2d 351, 352 (Tex. 1936)…………………………..42, 44
Statewide Remodeling, Inc. v. Williams, 244 S.W.3d 564
(Tex. App.—Dallas 2008, no pet.)………….…………………………15–17
Turner v. Package Exp., L.P., No. 14-12-00241-CV, 2013 WL 2149786
(Tex. App.—Houston [14th Dist.] May 16, 2013, no pet.)………..……….23
Vorwerk v. Williamson County Grain, No. 03-10-00549-CV,
2012 WL 593481 (Tex. App.—Austin Feb. 23, 2012, pet. denied)…..……17
Waite Hill Services, Inc. v. World Class Metal Works, Inc.,
959 S.W.2d 182 (Tex. 1996)…………………..…………………………..45
Werline v. E. Tex. Salt Water Disposal Co., 209 S.W.3d 888
(Tex. App.—Texarkana 2006) aff’d 307 S.W.3d 267 (Tex. 2010)...………41
Xtria L.L.C. v. Int’l Ins. Alliance, Inc., 286 S.W.3d 583
(Tex. App.—Texarkana 2009, pet. denied)…………….………………13, 41
STATUTES:
TEX. CIV. PRAC. & REM. CODE § 171.087 (West 2015)……………...…………..13
TEX. CIV. PRAC. & REM. CODE § 171.090 (West 2015)……………………..……30
9 U.S.C. § 9 (West 2015)…………………………………………………………13
54069386.3 - viii -
STATEMENT OF THE CASE
This case involves claims brought by Appellee, Dr. Alan Bentz, against the
Company (three limited liability companies Dr. Bentz co-founded) and the
Individual Appellants (the Company’s other founding members).1 In late 2011, the
Individual Appellants presented Dr. Bentz with a Hobson’s choice: he could accept
only $100,000 for the purchase of his membership interest in the Company, or he
would be expelled from it. Appellants’ Joint Brief at 1, n. 3. When Dr. Bentz
refused this low-ball offer, the Individual Appellants made good on their threat and
voted to expel him. Id. Under the Company Agreement, 2 however, Dr. Bentz
remained a member of the Company until he sold his membership interest.
C.R. 1489.3 After the expulsion vote, the Company elected to exercise its option
under the Company Agreement to purchase Dr. Bentz’s membership interest, but
the Company later refused to pay the purchase price, which was Fair Market
Value. Id. The Company also began paying Dr. Bentz’s share of the membership
distributions to the Individual Appellants instead of Dr. Bentz. Id. at 1490.
1
“The Company” refers to appellants Northwest Houston Emergency Specialists, P.L.L.C.
(“NHESG”), ESG MD, P.L.L.C., and ESG MLP, L.L.C, collectively. “The Individual
Appellants” refers to Dr. George Davis, Dr. Levon Vartanian, Dr. Anteneh Roba, and
Dr. Woodrow Dolino, collectively. “Appellants,” as used herein, refers to the Company and the
Individual Appellants, collectively.
2
“Company Agreement” refers to the Company Agreements of each of the Company entities,
which are identical except for the name of the entity. See C.R. 112–136 (the Company
Agreement).
3
The Clerk’s Record is cited herein as “C.R. _________.”
54069386.3 - ix -
The parties participated in a 5-day arbitration hearing in August 2014. A
complete transcript of the arbitration hearing was not made. At the hearing, and
through extensive pre- and post-hearing briefing, Dr. Bentz showed that the
Appellants’ actions constituted breaches of the Company Agreement, conversion,
and breaches of fiduciary duties. C.R. 1489–90. The Arbitrator then issued an
arbitration award in Dr. Bentz’s favor (the “Award”). See id. at 1488–92. The
Award granted Dr. Bentz the Fair Market Value purchase price of his membership
interest, his distributions that were wrongfully paid to the Individual Appellants,
pre-judgment interest, and attorneys’ fees. Id. at 1489–91. The Arbitrator also
declared that Dr. Bentz had remained a member of the Company until the date of
the Award. Id. at 1490.
Dr. Bentz then moved the trial court to confirm the Award. C.R. 1321–
1325. Unhappy with the Award, Appellants filed motions opposing confirmation
in which they sought to re-litigate the merits of the arbitration. C.R. 1413–1444,
1605–1623. But the Honorable Patricia Kerrigan, Judge of the 190th Judicial
District Court of Harris County, Texas, confirmed the Award, denied Appellants’
motions to vacate the Award, and signed the Judgment in Dr. Bentz’s favor.
C.R. 1794–98. Appellants’ motions for reconsideration of the confirmation were
denied, and Appellants filed a notice of appeal on March 9, 2015. C.R. 1962–63.
This appeal follows.
54069386.3 -x-
STATEMENT REGARDING ORAL ARGUMENT
In this appeal, Appellants ask the Court to ignore Texas’s strong
presumption in favor of arbitration awards and set aside a just arbitration award
rendered by an arbitrator who acted with full authority. Furthermore, Appellants
misconstrue the Award and ask this Court to rely on an incomplete record in order
to overturn it. Thus, and as shown more fully below, Appellants’ asserted points of
error run so contrary to Texas law that they do not merit oral argument before the
Court.
54069386.3 - xi -
STATEMENT OF ISSUES PRESENTED
Issue 1: Did the trial court err by Confirming the Award over Appellants’
opposition when:
(a) The Arbitrator followed the Company Agreement’s mandate that all
disputes be arbitrated other than disputes over the narrow issues
enumerated in Section 9.01?
(b) The Arbitrator awarded Dr. Bentz that portion of Dr. Bentz’s
membership distributions which the Individual Appellants took for
themselves despite Dr. Bentz’s continuing right to those distributions
during the time period in which Dr. Bentz continued to own his
membership interest?
Issue 2: Did the trial court err by confirming the Award over Appellants’
opposition by awarding damages to Dr. Bentz for the Company’s failure to
complete the contractual process to purchase Dr. Bentz’s membership interest and
for the Company’s payment of Dr. Bentz’s membership distributions to the
Individual Appellants during that time that Dr. Bentz was still a member of the
Company?
54069386.3 - xii -
STATEMENT OF FACTS
Dr. Bentz and the Individual Appellants founded the Company, and each had
a 20% membership interest. C.R. 112–13, 136. The Company was composed of
three limited liability companies, and (along with NHESG’s wholly-owned
subsidiary, Houston Northwest Emergency Specialists, PLLC), it staffed the
emergency department of Houston Northwest Medical Center. Appellants’ Joint
Brief at 1. Over the years, Dr. Bentz served in various administrative and business
capacities for the Company, which became quite successful. See C.R. 1564
(Company income statement showing yearly profits in the millions from 2009 to
2011).
By mid-2011, however, Dr. Bentz’s relationship with the Individual
Appellants had soured over clashes of personalities, and the Individual Appellants
decided to oust him. Appellants’ Joint Brief at 1, n. 3. The Appellants offered
Dr. Bentz a Hobson’s choice in late 2011: the Company would pay him a mere
$100,000 to buy his membership interest, or the Individual Appellants would vote
to expel Dr. Bentz from the Company. Id. When Dr. Bentz refused this low-ball
offer, the Individual Appellants voted to expel him. Id.
Under the Company Agreement, however, expulsion did not cause a
member to automatically lose his membership interest. C.R. 1489. Instead,
expulsion merely triggered the Company’s and the other members’ right—but not
54069386.3 -1-
obligation—to force the expelled member to sell his membership interest.
C.R. 1489; see also C.R. 114 at § 2.05 (“…during a period of 180 days following
the expulsion of a Member, the Company and the other Members shall have an
option (but not an obligation) to purchase all of the Membership Interest owned by
such…expelled Member….”). If the Company or other members elected to
exercise that option, the Company Agreement required instruments conveying the
membership interest to be exchanged for the purchase price at a closing. C.R. 115
at § 2.08. The purchase price would be “Fair Market Value” as defined in the
Company Agreement. See id. at § 2.09. There were no provisions for transferring
a membership interest in the event the Company or the other members exercised
their option to purchase the expelled member’s membership interest then failed to
close and pay the purchase price.
After the Individual Appellants voted to expel Dr. Bentz, the Company
elected to exercise its option to purchase Dr. Bentz’s membership interest.
Appellants’ Joint Brief at 1. While that process was pending, Dr. Bentz remained a
member. C.R. 1489–90. During that time, however, the Company did not pay
Dr. Bentz his share of membership distributions and instead paid them to the
Individual Appellants. C.R. 1489. For these reasons, amongst others, Dr. Bentz
filed for arbitration on November 1, 2012 under the arbitration provision of
Section 9.02 of the Company Agreement, which provided a mechanism for
54069386.3 -2-
resolving “any Dispute under [the Company Agreement] which [was] not
otherwise resolved pursuant to other procedures under Section 9.01.” See
C.R. 128–29 at § 9.02; see also C.R. 137–153.
Section 9.02’s broad scope contrasted with the narrow scope of Section 9.01,
which only provided procedures to decide limited issues. Compare C.R. 128–29 at
§ 9.02 with C.R. 127–28 at § 9.01. In relevant part, Section 9.01 provided a
procedure to determine the “controlling opinion” on the Fair Market Value of a
membership interest. C.R. 127 at § 9.01(a). Per that procedure, Dr. Bentz and the
Company each appointed appraisers (the “party-appointed appraisers”).
C.R. 1418, 1489. Both party-appointed appraisers then opined on the Fair Market
Value of Dr. Bentz’s membership interest. C.R. 1418. The party-appointed
appraisers also appointed a third appraiser (the “common appraiser”), whose sole
task under Section 9.01 was to determine “which opinion [was] the controlling
opinion . . .” on the Fair Market Value of a membership interest. Id.; C.R. 127–28
at § 9.01. Aside from the selection of the controlling opinion on Fair Market
Value, there were only two other issues that could be decided under Section 9.01:
(1) who would serve as the party-appointed appraiser for the purchasers of a
membership interest; and (2) who would serve as the common appraiser. See
C.R. 127–28 at § 9.01. Neither of those two issues are relevant in this appeal.
54069386.3 -3-
While the Section 9.01 proceeding to determine the controlling opinion was
pending, the Individual Appellants moved to stay the Section 9.02 arbitration,
arguing that any Section 9.01 proceeding had to be completed before the
arbitration could proceed under Section 9.02. C.R. 102–11. On April 4, 2013, the
trial court ordered the Section 9.02 arbitration stayed until the Section 9.01
procedure was completed. C.R. 522–24.
On January 3, 2014, the common appraiser chose the opinion of the
Company’s appraiser, Reed Tinsley, as the controlling opinion. C.R. 1418.
Mr. Tinsley’s opinion was that the Fair Market Value was either $257,969 under
an asset approach, or $526,796 under an income approach. C.R. 1555. With this
opinion chosen as the controlling opinion, the Section 9.01 proceeding was
complete.4 No other issues in the dispute were to be decided (or indeed, could be
decided) under Section 9.01. The path was clear for the Section 9.02 arbitration to
continue to resolve all other disputes between the parties.
4
Appellants repeatedly state throughout their brief that the Section 9.01 proceeding was
completed. Appellants’ Joint Brief at 11 (“The parties finished the Section 9.01 process and a
‘Fair Market Value’ was determined. . . .”), 18 (“The determination of the controlling opinion as
to Fair Market Value by Mr. Mr. Carr concluded the Section 9.01 Fair Market Value process.”),
20 (“Once the Section 9.01 process was finished, the parties moved to arbitration.”), and 26
(“The Section 9.01 proceeding was concluded on January 3, 2014.”). It is unclear, then, why
Appellants suggest at the end of their brief that the Section 9.01 proceeding has not ended. Id. at
46 (“If the Award against the Company is vacated, the Section 9.01 process remains open until
the parties close on the purchase option.”); n.38 (“This appeal must be resolved before the parties
can conclude the Section 9.01 process. . . .”). In any event, as described below in Section II.B.1,
the common appraiser had, as of the time of the Section 9.02 arbitration, already decided the
only issue before him under Section 9.01—that is, which party-appointed appraiser’s opinion
was the controlling opinion on Fair Market Value.
54069386.3 -4-
After the Section 9.02 arbitration process resumed, the parties engaged in
extensive discovery, deposed seven individuals, and submitted over 100 pages of
prehearing briefing. C.R. 1324; see also C.R. 1419 (discussing post-hearing
briefing submitted to the Arbitrator). The hearing was then held from August 19,
2014 through August 22, 2014, and reconvened for a final day on August 29, 2014.
C.R. 1488. At the hearing, the Arbitrator received the testimony of Dr. Bentz, each
of the four Individual Appellants, three non-party witnesses, and three expert
witnesses. C.R. 1324, 1488. The Individual Appellants elected to have a court
reporter transcribe part of the opening statements and part of Dr. Bentz’s
testimony, but they declined to have the court reporter transcribe the rest, and no
other party made any record of the hearing. See C.R. 1782–93 (part of the
incomplete record). Appellants conceded that the Fair Market Value of
Dr. Bentz’s membership interest was $526,796. See C.R. 1489 (“All Parties have
acknowledged… that the appropriate Fair Market Value of Dr. Bentz’s
Membership Interest is $526,796.”). Following the arbitration hearing, each party
submitted post-hearing briefs to supplement the Parties’ already-extensive
prehearing briefs. Id.
The Arbitrator then issued the Award on October 15, 2014. C.R. 1488. In
it, the Arbitrator found that “all Parties have acknowledged. . . that the appropriate
Fair Market Value of Dr. Bentz’s Membership Interests [was] $526,796,” a figure
54069386.3 -5-
consistent with the controlling opinion from the Section 9.01 proceedings.
C.R. 1489, 1555. The Arbitrator determined that Dr. Bentz was entitled to recover
that sum because the Company breached the Company Agreement by electing to
exercise the option to purchase Dr. Bentz’s interest and then failing to pay the
purchase price by the contractual deadline. C.R. 1489. The Arbitrator also
determined that Dr. Bentz was entitled to his pro rata share of membership
distributions made while Dr. Bentz remained a member because “[c]ommon sense,
logic and a careful reading of the Agreements compel that, until paid for his
Interest, a Member, even an expelled Member, is entitled to his share of any
distributions made by the [Company].” C.R. 1490. Finally, the Arbitrator also
awarded Dr. Bentz pre-judgment interest, costs, and attorneys’ fees.5 C.R. 1491.
The trial court later confirmed the Award over Appellants’ objections,
entered the Judgment, and denied Appellants’ motions for reconsideration.
C.R. 1794–98, 1962. Shortly afterward, Appellants sued the law firm and attorney
who had drafted the Company Agreement, alleging that they committed
malpractice. C.R. 1942–52. Appellants further alleged that they had already
satisfied the Judgment—though they had not and have not done so. See C.R. 1950
5
Per the Company Agreement, the Arbitrator awarded attorneys’ fees to Dr. Bentz because he
was a substantially prevailing party. See C.R. 131 at § 9.03 (“In the event a proceeding under
this Article 9 is commenced…the party who prevails or substantially prevails in such proceeding
shall be entitled to recover . . . all costs, expenses and reasonable attorneys’ fees incurred in
connection with the proceeding and on appeal.”); C.R. 1491 (“…Claimant substantially prevailed
in his claims and is entitled to recover his costs, expenses and reasonable attorney fees.”).
54069386.3 -6-
(characterizing the award of distributions and attorneys’ fees to Dr. Bentz as
“pecuniary losses” that “Plaintiffs sustained. . . .”); C.R. 1947 (stating that a sum
mentioned earlier in the petition “does not include any portion of the $532,064
paid to Bentz to buy-out his membership share . . . .”) (emphasis added). This
appeal follows.
54069386.3 -7-
SUMMARY OF THE ARGUMENT
At the crux of this appeal is Appellants’ refusal to recognize that, under
Section 9.02 of the Company Agreement, they agreed to arbitrate “any Dispute
under [the Company Agreement] which [was] not otherwise resolved pursuant to
other procedures under Section 9.01,” which is exactly what happened when the
parties submitted their dispute to the Arbitrator. In contrast, Section 9.01 provided
mechanisms for the narrow determinations of: (1) who would serve as the party-
appointed appraiser for a purchase of a membership interest, (2) who would serve
as the common appraiser, and (3) which party-appointed appraiser’s opinion would
be the controlling opinion on the Fair Market Value of a membership interest.
None of these issues were decided in the Section 9.02 arbitration. Rather, after a
five-day hearing and over a month of deliberation, the Arbitrator properly
determined, amongst other things, that: (1) Dr. Bentz was entitled to recover
damages from the Company for its failure to buy Dr. Bentz’s membership interest
after electing to exercise its option to do so; (2) Dr. Bentz was entitled to recover
damages from the Individual Appellants for their wrongful appropriation of his pro
rata share of membership distributions; and (3) Dr. Bentz was entitled to recover
attorneys’ fees per the Company Agreement because he substantially prevailed in
the arbitration.
54069386.3 -8-
Appellants would have the Court believe that this dispute was actually about
one thing: the propriety of Dr. Bentz’s expulsion from the Company. Although the
parties did dispute the propriety of Dr. Bentz’s expulsion, the parties also disputed
what happened to Dr. Bentz’s membership interest if he had been properly
expelled, and resolving this dispute required interpretation of the Company
Agreement—an issue for arbitration under Section 9.02. Under the Company
Agreement, a member’s expulsion triggered the Company’s and the other
members’ right—but not obligation—to buy the member’s membership interest at
the Fair Market Value.
Here, upon Dr. Bentz’s expulsion, the Company elected to exercise their
option to purchase Dr. Bentz’s membership interests but then refused to complete
the purchase by paying Dr. Bentz the Fair Market Value. And, even though no one
had paid Dr. Bentz for his membership interest, Appellants claimed that
Dr. Bentz’s membership interest had disappeared and that he was no longer
entitled to his share of membership distributions. On the other hand, Dr. Bentz
argued that because his membership interest was his personal property, he
continued to own the interest and its attendant membership distribution rights until
he transferred it. See TEX. BUS. ORGS. CODE § 101.106 (West 2015) (“A
membership interest in a limited liability company is personal property.”) This is
the same merits-based dispute that is at issue in this appeal.
54069386.3 -9-
The Arbitrator has already decided this dispute, and he agreed with
Dr. Bentz’s interpretation of the Company Agreement and Texas law. The
Arbitrator therefore awarded Dr. Bentz the damages he was entitled to: payment
for his membership interest, his unpaid share of the membership distributions,
attorneys’ fees, prejudgment interest, and costs.
Because Appellants do not like the Arbitrator’s decision, they now wish to
retry the merits of the dispute. Knowing that courts defer to arbitrators to
determine the merits, however, Appellants have recast their claims in the form of
jurisdictional arguments. Appellants claim first that the Arbitrator exceeded his
authority because the parties did not agree to grant the Arbitrator the authority to
award Dr. Bentz the recoveries contained in the Award. This argument, however,
ignores the fact that, by assenting to the Company Agreement, the Appellants
agreed to resolve these disputes under the broad ambit of Section 9.02, and the trial
court properly rejected it.
Appellants also claim that the Award includes a double recovery and that
Texas’s common law policy against double recoveries is so extraordinary and
fundamental that its violation requires vacatur here. Appellants’ argument fails
because, as two other courts of appeals have held, the award of a double recovery
does not warrant vacatur. Appellants’ argument also fails because common law
grounds for vacatur—such as vacating an arbitration award because it violates
54069386.3 - 10 -
public policy—are not grounds for vacatur under the Federal Arbitration Act,
which applies here. In any event, the Award does not include a double recovery
because its different components compensate Dr. Bentz for different injuries.
Finally, Appellants request to modify the Award so that the Award would:
(1) maintain the only aspect of the Award favorable to Appellants (the Arbitrator’s
determination that Dr. Bentz was expelled using the proper procedures); (2)
include a determination the Arbitrator never made (that Appellants did not breach
the Company Agreement); and (3) delete the other components of the Award
(which were unfavorable to Appellants). These requested modifications are
impermissible because Appellants did not preserve this argument for appeal, they
would give Appellants relief they did not request, and they would improperly
segregate intertwined issues.
The Arbitrator properly interpreted Texas law and the Company Agreement,
and he acted within his authority in doing so. The trial court accordingly showed
due deference to the Arbitrator’s well-reasoned decision. This Court should not
disturb the trial court’s decision, because doing so would not only upset Texas’s
strong presumption in favor of arbitration awards; it would undo a just Award
rendered with full authority. It has been nearly four years since the Individual
Appellants voted to expel Dr. Bentz, and Dr. Bentz has yet to receive any
54069386.3 - 11 -
compensation for the harm Appellants inflicted upon him. The Court should reject
Appellants’ latest stalling tactic6 and affirm the Judgment.
6
There is a real risk that Appellants’ stalling tactics may prevent Dr. Bentz from obtaining
satisfaction of the Award and Judgment. See C.R. 1608 (“The Hospital Contract was the
[Company’s] sole source of revenue, and the [Company] held little in the way of additional
assets. On October 31, 2013, during the pendency of the underlying arbitration proceedings, the
Hospital Contract terminated when the Hospital elected not to renew it. The [Company] has
earned no additional revenues since that time (though trailing collections continued to trickle in
over the next several months). Other than these proceedings, the [Company] has no ongoing
business and intends to wind down once they reach a final conclusion.”)
54069386.3 - 12 -
ARGUMENT AND AUTHORITIES
I. Standard of Review
Appellants urge the Court to undertake a sweeping review of the Arbitrator’s
reasoning and set aside portions of the Award despite the fact that review of an
arbitration award is “extraordinarily narrow.” GJR Mgmt. Holdings, L.P. v. Jack
Raus, Ltd., 126 S.W.3d 257, 262 (Tex. App.—San Antonio 2003, pet. denied).
Upon a party’s application, the court “shall confirm [an] award . . . [u]nless
grounds are offered for vacating, modifying, or correcting [it].” TEX. CIV. PRAC. &
REM. CODE § 171.087 (West 2015) (emphasis added); see also 9 U.S.C. § 9
(“…the court must grant [an order confirming the award] unless the award is
vacated, modified, or corrected….”). “A mere mistake of fact or law alone is
insufficient to set aside an arbitration award.” Anzilotti v. Gene D. Liggin, Inc.,
899 S.W.2d 264, 266 (Tex. App.—Houston [14th Dist.] 1995, no writ).
Furthermore, when reviewing an arbitration award, courts are “not limited to the
arbitrator’s explanation for his award.” Xtria L.L.C. v. Int’l Ins. Alliance, Inc., 286
S.W.3d 583, 591 (Tex. App.—Texarkana 2009, pet. denied) (citing JJ-CC, Ltd. v.
Transwestern Pipeline Co., No. 14-96-1103-CV, 1998 WL 788804, at *4 (Tex.
App.—Houston [14th Dist.] Nov. 12, 1998, no pet.)).
Courts “must indulge every reasonable presumption to uphold arbitration
awards.” Anzilotti, 899 S.W.2d at 266. When “a non-prevailing party seeks to
54069386.3 - 13 -
modify or vacate an arbitrator’s award, he bears the burden to bring forth a
complete record that establishes his basis for relief.” Id. at 267 (citing Kline v.
O’Quinn, 874 S.W.2d 776, 790 (Tex. App.—Houston [14th Dist.] 1994, writ
denied) (op. on reh’g)). And where, as here, the non-prevailing party alleges that
the Arbitrator exceeded his power, the non-prevailing party’s burden is a heavy
one. IQ Holdings, Inc. v. Villa D’Este Condominium Owners’ Ass’n Inc.,
__ S.W.3d. __, No. 01-11-00914-CV, 2014 WL 982844, at *3 (Tex. App.—
Houston [14th Dist.] Mar. 13, 2014, no pet.).
II. Applying Texas law: the Award must be upheld.
Appellants raise two main issues on appeal. Appellants’ Joint Brief at xiv.
First, Appellants claim that the trial court erred in confirming the Award because
the Arbitrator exceeded his authority under the Company Agreement. Id. at 23–31.
Appellants also sprinkle this first issue with various evidentiary challenges to the
Award. Id. at 15–31. Second, Appellants claim that the trial court erred in
confirming the Award because the Award violated an extraordinary, fundamental
public policy by awarding a double recovery. Id. at 31–42. As a remedy for these
supposed deficiencies, Appellants ask the Court to modify the Award so that the
Award declares that Dr. Bentz was properly expelled and that Appellants did not
breach the Company Agreement. Appellants’ Joint Brief at 42–47.
54069386.3 - 14 -
As described more fully below, Appellants’ claims fail because: (A) without
a complete record of the arbitration proceedings, Appellants cannot overcome the
strong presumption in favor of upholding the Award; (B) the Arbitrator properly
exercised his Section 9.02 authority to decide all disputes related to the Company
Agreement other than those disputes decided under Section 9.01; (C) the Arbitrator
did not award a double recovery, but regardless, awarding a double recovery does
not warrant vacatur; and (D) even if the Court questions the trial court’s
confirmation of the Award, it cannot order the modification that Appellants
request.
A. Without a complete record of the arbitration proceedings,
Appellants cannot overcome the presumption in favor of
upholding the Award.
When “a non-prevailing party seeks to modify or vacate an arbitrator’s
award, he bears the burden to bring forth a complete record that establishes his
basis for relief.” Anzilotti, 899 S.W.2d at 267 (emphasis added) (citing Kline, 874
S.W.2d at 790). “A court must have a sufficient record of the arbitral proceedings,
and complaints must have been preserved, all as if the award were a court
judgment on appeal.” Nafta Traders Inc. v. Quinn, 339 S.W.3d 84, 101 (Tex.
2011). In order to be a complete record, the record must include a full transcript of
the arbitration hearing. Statewide Remodeling, Inc. v. Williams, 244 S.W.3d 564,
569 (Tex. App.—Dallas 2008, no pet.) (where party claimed arbitrator committed a
54069386.3 - 15 -
gross mistake and awarded a measure of damages not requested, appellate court
held that it “[could not] conclude the trial court erred in holding [the party] to the
burden of bringing forth a complete record of the arbitration proceedings,
including a transcript of the arbitration hearing.”). Absent a transcript of the
arbitration, “[n]either the attorneys’ recollection of what testimony was or was not
before the arbitrator nor the attachments to the motion to vacate provide a complete
record of the arbitration proceedings.” Statewide Remodeling, 244 S.W.3d at 569.
Where, as here, the non-prevailing party fails to provide the court with a
complete record, the court must presume that the evidence supports the arbitration
award and uphold that award. See Nafta Traders, 339 S.W.3d at 102 (“If error
cannot be demonstrated, an award must be presumed correct.”); Goldman v.
Buchanan, No. 05-12-00050-CV, 2013 WL 1281744, at *3 (Tex. App.—Dallas
Mar. 21, 2013, no pet.) (where party sought vacatur award on basis that arbitrators
exceeded their powers but “failed to introduce a record of the arbitration
proceedings before the district court,” appellate court had to “presume the evidence
supported the award” and therefore affirmed award’s confirmation); Schuster v.
Wild, No. 13-13-00474-CV, 2015 WL 251564, at *5 (Tex. App.—Corpus Christi
Mar. 5, 2015, pet. denied) (op. on reh’g) (reversing the trial court’s vacatur of
arbitration award based on the arbitrator exceeding his authority because “without
a transcript of the arbitration proceedings, [the court is] required to presume that
54069386.3 - 16 -
the evidence adequately supported [the award]”). The informal nature of arbitration
does not release a party from its burden to bring forward a complete record,
because “[w]ithout a record,” a court “cannot conclusively determine the basis for
the arbitrator’s award. . . .” 7 Vorwerk v. Williamson County Grain, No. 03-10-
00549-CV, 2012 WL 593481, at *6 (Tex. App.—Austin Feb. 23, 2012, pet.
denied) (citing GJR Mgmt., 126 S.W.3d at 263 and Statewide Remodeling, 244
S.W.3d at 569–70). Appellants claim that a complete record of the arbitration
proceedings is not required for this Court to determine that the Arbitrator exceeded
his authority. Appellants’ Joint Brief at 15. That is incorrect, and Appellants have
cited no cases in which an appellate court ruled that an arbitrator exceeded his
authority while relying on an incomplete record. Instead, Appellants cite
Centex/Vestal v. Friendship West Baptist Church, which does not support their
argument. 314 S.W.3d 677 (Tex. App.—Dallas 2010, pet. denied).
In Centex/Vestal, the non-prevailing party brought forth no record at all as to
one claim the arbitrator decided. Id. at 687. Accordingly, the court concluded that
the “failure to bring forth a complete record of the arbitration proceeding [was]
7
The Supreme Court aptly described the public policy supporting the requirement that a party
bring forth a complete record on appeal: “For efficiency’s sake, arbitration proceedings are often
informal; procedural rules are relaxed, rules of evidence are not followed, and no record is made.
These aspects of arbitration, which are key to reducing costs and delay in resolving disputes,
must fall casualty to the requirements for full judicial review. The parties can decide for
themselves whether the benefits are worth the additional cost and delay, but the only review to
which they can agree is the kind of review courts conduct.” Nafta Traders, 339 S.W.3d at 101–
02.
54069386.3 - 17 -
fatal” to the claim for vacatur. Id. As to other claims the arbitrator decided, the
court considered the limited record provided to it and determined that the arbitrator
acted within his authority on those claims. Id. at 685–86. In deciding that the
arbitrator did not exceed his authority, the court considered the partial record, but
“presume[d] any remaining evidence support[ed] the Award.” Id. at 685. And in
the end, the court found that the arbitrator did not exceed his authority in deciding
those claims. Id. at 686. This Court is presented with a similar situation;
Appellants provided only a limited record, so the Court must “presume any
remaining evidence supports the Award.” Id. at 685. As explained more fully
below, this presumption defeats Appellants’ claim for vacatur.
1. The issues decided by the Arbitrator were submitted in the
arbitration, and without a complete record, the trial court
had to presume that they were submitted.
Appellants claim that the Arbitrator issued an Award on issues not submitted
to him. Appellants’ Joint Brief at 23–27. However, the Arbitrator did not rule on
any issues not submitted to him, and, moreover, the Court must reject Appellants’
claim to the contrary because the Court “do[es] not have a record of the arbitration
and [is] unable to determine what claims were submitted or what evidence was
offered before the arbitrator[].” Kline, 874 S.W.2d at 783. Without a record of the
hearing, the court “ha[s] no way of knowing whether a fact issue was raised, or for
that matter, whether certain issues were tried by consent.” Brockman v. Tyson, No.
54069386.3 - 18 -
01-03-01335-CV, 2005 WL 2850128, at *4 (Tex. App.—Houston [1st Dist.] Oct.
27, 2005, pet. denied). Accordingly, “[w]ithout a transcription of the arbitration
proceedings, [the court] must presume adequate evidence to support the award.”
Kline, 874 S.W.2d at 783 (citing House Grain Co. v. Obst, 659 S.W.2d 903, 906
(Tex. App.—Corpus Christi 1983, writ ref’d n.r.e.)).
2. The evidence supported the damages awarded, and without
a complete record, the trial court had to presume that it did.
Appellants next claim that the Award failed the “essence” test because it is
not “rationally inferable” from the agreement. Appellants’ Joint Brief at 28. They
also argue that the Award constitutes an impermissible double recovery. Id. at 31–
34. The validity of these arguments implicates factual and legal questions, both of
which were fully briefed and argued to the Arbitrator, but most of those briefings
and arguments are not part of the record before this Court.
As more thoroughly explained to the Arbitrator through briefing, oral
argument, and expert testimony, awarding Dr. Bentz the Fair Market Value of his
interest and his share of distributions compensates Dr. Bentz for two different
injuries. First, awarding Dr. Bentz the Fair Market Value of his interest
compensates Dr. Bentz for the Company’s failure to purchase Dr. Bentz’s 20%
membership interest after it elected to do so. C.R. 1489. Second, awarding
Dr. Bentz damages equal to the distributions the Individual Appellants wrongfully
appropriated compensates Dr. Bentz for the membership distributions he should
54069386.3 - 19 -
have received while he remained a member of the Company. C.R. 1490. Thus,
Dr. Bentz was awarded separate damages for the violation of two separate
contractual rights—his right to the purchase price of his membership interest and
his right to distributions while he remained a member.
At the arbitration hearing, Appellants’ own damages expert conceded that
awarding Dr. Bentz the Fair Market Value and his share of distributions would not
be a double recovery if Dr. Bentz were found to still be a member of the Company
after expulsion—which is, in fact, what the Arbitrator found. C.R. 1489. This
testimony is not included in the appellate record because Appellants failed to
provide the trial court with a complete record. But, without a complete record of
the hearing, Appellants cannot rebut the presumption that the evidence supported
the award of Fair Market Value and distributions—and, in fact, it did.
In an instructive case, CC Williams Construction Co., Inc. v. Rico, the non-
prevailing party sought vacatur on the basis that the arbitrator exceeded his
authority and granted a double recovery to the prevailing party, but the non-
prevailing party failed to provide a transcript of the hearing. No. 09-10-00472-CV,
2011 WL 2135074, at *2–3 (Tex. App.—Beaumont May 19, 2011, no pet.). This
failure was fatal to the claim for vacatur. Id. The court held:
The record does not indicate that the [non-prevailing party] provided
the trial court with a complete record, i.e., a transcript of the
arbitration proceedings. See Williams, 244 S.W.3d at 569 (Finding
that the trial court did not err by requiring non-prevailing party to
54069386.3 - 20 -
provide a transcript of arbitration proceedings, even when no such
transcript was made and the party provided affidavits, exhibits, and an
attorney’s testimony regarding what occurred at the arbitration
proceeding). The [non-prevailing party’s] grounds for vacatur all
depend on the evidence offered and considered by the arbitrator and
the manner in which the arbitrator conducted the proceedings, none of
which the record contains. . . . We, therefore, presume that the
arbitration evidence supported the award. . . .
Under these circumstances, we conclude that the trial court erred by
refusing to confirm the arbitration award and by setting aside and
vacating the award.
Id. at *3.
Recently, the Fourteenth Circuit Court of Appeals issued another instructive
opinion in Mega Builders, Inc. v. Paramount Stores, Inc. No. 14-14-00744-CV,
2015 WL 3429060 (Tex. App.—Houston [14th Dist.] May 28, 2015, no pet. h.). In
Mega Builders, the appellant argued that the arbitrator “double count[ed]” a sum
awarded to the appellee. Id. at *2. As in CC Williams Construction, however, the
appellant’s failure to provide a record of the arbitration proceedings proved fatal to
its claim for vacatur. Id. at *3. The court explained:
[B]ecause we have no record of the arbitration proceedings, we cannot
determine whether the two entries constitute a double counting, as
[the appellant] alleges, or whether the two entries were intentionally
included in the calculation of the award based on the evidence
submitted to the arbitrator, as [the appellee] argues. Absent a record,
we must presume that the record supports the arbitrator’s
determination of the proper amount of the award.
Id.
54069386.3 - 21 -
Here, as in CC Williams Construction and Mega Builders, Appellants have
not met their burden to provide a complete record. Accordingly, the Court must
presume that the record that it lacks supports the Award.
3. Appellants conceded the value of Dr. Bentz’s membership
interest, and without a complete record, the trial court
could not find otherwise.
The lack of a complete record requires the Court to reject Appellants’
argument that the Arbitrator exceeded his powers by deciding a dispute as to the
Fair Market Value of Dr. Bentz’s interest. In support of their argument, Appellants
cite seven pages of an unofficial transcript from the opening presentations during
the first day of the hearing. Appellants’ Brief at 21 (citing C.R. 1787–93). But
even this unofficial transcript demonstrates the Individual Appellants’ willingness
for the Arbitrator to award Dr. Bentz the Fair Market Value of his interest as long
as it was within the range decided in the Section 9.01 proceeding:
Mr. Mussalli: What I think would help us is, you know, if there’s an
agreement that, you know, if say let’s allow Mr. Wood to determine –
there’s the word determine again – let’s allow Mr. Wood to choose, so
to speak, as long as you don’t exceed the higher number.
C.R. 1790 at 74:11–16.
Appellants’ reliance on arguments presented at the hearing underscores the
very reason that Texas law imposes a burden upon the non-prevailing party to
bring forth a complete record of the arbitration: the Court cannot review the
propriety of the Arbitrator’s exercise of his powers without a record of what
54069386.3 - 22 -
happened. Here, the lack of a complete record prevents the Court from reviewing
the testimony and arguments from the rest of the hearing. And what happened at
the rest of the hearing is important.
Over the course of the hearing, Appellants did not argue that $526,796 was
not the Fair Market Value. Rather, as the Arbitrator stated in the Award, “[a]ll
Parties [] acknowledged. . . that the appropriate Fair Market Value of Dr. Bentz’s
Membership Interests [was] $526,796.” C.R. 1489. The Court must presume the
truthfulness of the Arbitrator’s statement. See Turner v. Package Exp., L.P., No.
14-12-00241-CV, 2013 WL 2149786, at *6 n.8 (Tex. App.—Houston [14th Dist.]
May 16, 2013, no pet.) (because the arbitrator’s award stated that the non-
prevailing party “stated in his Closing Brief that he did not want to pursue any
claims against [the prevailing party],” and the Closing Brief was not included in
the appellate record, the court presumed that the Closing Brief supported the
arbitrator’s decision). Therefore, although Appellants now claim that the
Arbitrator improperly decided a dispute as to the Fair Market Value of Dr. Bentz’s
interest, the Award reflects that, by the close of the hearing (at the latest), there
was no longer a dispute as to the Fair Market Value. Had a full record of the
hearing been made, it would show that the Arbitrator did not exceed his powers.
But without a complete record, the Court must abide by the presumption in favor
of upholding the Award.
54069386.3 - 23 -
B. The Arbitrator properly exercised his broad authority under
Section 9.02 to decide all disputes other than those decided under
Section 9.01.
Appellants claim that the Arbitrator exceeded his authority in issuing the
Award. Appellants’ Joint Brief at xiv. When deciding whether an arbitrator acted
within his jurisdiction, the “appropriate inquiry is not whether the arbitrator
decided an issue correctly, but instead whether he had the authority to decide the
issue at all.” Forest Oil Corp. v. El Rucio Land and Cattle Co., Inc., 446 S.W.3d
58, 81 (Tex. App.—Houston [1st Dist.] July 24, 2014, pet. filed) (citing D.R.
Horton—Texas, Ltd. v. Bernhard, 423 S.W.3d 532, 534 (Tex. App.—Houston
[14th Dist.] 2014, pet. denied)). Further, “there is a presumption that the
arbitrator’s actions were within his authority, and [the Court] [must] resolve all
doubts in favor of the award.” Barton v. Fashion Glass and Mirror, Ltd., 321
S.W.3d 641, 646 (Tex. App.—Houston [14th Dist.] 2010, no pet.); Prudential Sec.
Inc. v. Marshall, 909 S.W.2d 896, 899 (Tex. 1995). The burden is therefore “on
the party challenging the award to prove the arbitrator acted outside his authority.”
Id. “[W]hen, as here, there is a broad arbitration clause, arbitration of a particular
claim should not be denied unless it can be said ‘with positive assurance that the
arbitration clause is not susceptible of an interpretation that covers the dispute.’”
Centex/Vestal, 314 S.W.3d at 685–86 (quoting Kline, 874 S.W.2d at 782).
54069386.3 - 24 -
In support of their claim that the Arbitrator exceeded his authority,
Appellants make several faulty arguments. They argue that the Arbitrator did not
have authority to award Dr. Bentz the Fair Market Value of his interest and
distributions because those remedies were barred by Section 9.01. Appellants’
Joint Brief at 21–23. They also argue that there was no agreement to award
Dr. Bentz a “buyout.” Id. at 22–27. Finally, they argue that the Award fails the
“essence” test because it was not “rationally inferable” from the agreement. Id. at
28.
These arguments fail for several reasons: (1) Section 9.02 of the Company
Agreement gave the Arbitrator the authority to decide all disputes related to the
Company Agreement other than disputes resolved pursuant to Section 9.01, and
none of the disputes the Arbitrator decided were, or even could have been, decided
under Section 9.01; (2) the Arbitrator had authority to decide the appropriate
remedies for the disputes submitted to him under Section 9.02; and (3) the Award
was rationally inferable from the Agreement, as shown by the Arbitrator’s well-
reasoned discussion in the Award.
54069386.3 - 25 -
1. Section 9.02 gave the Arbitrator authority to decide all
disputes related to the Company Agreement other than
disputes resolved pursuant to Section 9.01, and none of the
disputes the Arbitrator decided were, or could have been,
decided under Section 9.01.
Appellants have not met their burden to prove the arbitrator acted outside his
authority. Section 9.02 gave the Arbitrator authority to “any dispute under [the
Company Agreement] which is not otherwise resolved pursuant to other
procedures under Section 9.01….” C.R. 128–29 at § 9.02; see also Jack B. Anglin
Co., Inc. v. Tipps, 842 S.W.2d 266, 267–71 (Tex. 1992) (reading a provision
allowing for disputes “under the Contract [to] be submitted to arbitration…”
broadly and, accordingly, holding arbitration of DTPA claims proper because
DTPA claims were “intertwined” with contract claims) (emphasis added). And
Section 9.01 provided procedures for deciding only three types of disputes: (1)
who would serve as the party-appointed appraiser for purchasers of a membership
interest; (2) who would serve as the common appraiser; and (3) which party-
appointed appraiser’s opinion on the Fair Market Value of a membership interest
would be controlling. C.R. 127 at § 9.01. Thus, Section 9.02 granted the
Arbitrator authority to decide all other disputes related to the Company
Agreement.
The controlling opinion on Fair Market Value had been determined under
Section 9.01 prior to the Section 9.02 arbitration that resulted in the Award. See
54069386.3 - 26 -
C.R. 128–29 at § 9.02 (establishing the Arbitrator’s broad authority); Appellants’
Joint Brief at 26 (“The Section 9.01 proceeding was concluded on January 3,
2014.”) The Arbitrator then relied on the controlling opinion in issuing the Award.
The Arbitrator awarded Dr. Bentz the Fair Market Value of his interest, which
Appellants conceded was $526,796—a valuation taken directly from the
controlling Fair Market Value opinion. C.R. 1489. In other words, rather than
invading the Section 9.01 proceeding, as Appellants erroneously allege, the
Arbitrator properly relied on the result of the Section 9.01 proceeding. See id.
Appellants also argue that the Arbitrator awarded a “buyout,” which they allege
was a Section 9.01 matter. Appellants’ Joint Brief at 23. Appellants are incorrect
on this point in two respects. First, Appellants claim the award included a buyout
“similar to the old shareholder oppression cases. . . .” Appellants’ Joint Brief at
27. But the Arbitrator did not award a “buyout” as a remedy in tort; rather, the
Arbitrator enforced the Company Agreement. Because the Company breached the
option to purchase Dr. Bentz’s interest, the Arbitrator enforced the option by
ordering the Company to pay Dr. Bentz the purchase price for his interest, and by
requiring Dr. Bentz to relinquish that interest. C.R. 1489.
Second, regardless of whether enforcing the option constitutes a “buyout,”
the fashioning of remedies is not a Section 9.01 matter. There is no provision in
Section 9.01 for ruling on a party’s cause of action or awarding a party any type of
54069386.3 - 27 -
damages—those disputes are left to the broad arbitration authority of Section 9.02.
Compare C.R. 128—29 at §9.02 (establishing Section 9.02’s broad arbitration
authority) with C.R. 127–28 at § 9.01 (carving out from Section 9.02’s broad
arbitration authority narrow issues for determination under Section 9.01). Thus,
whether enforcing the option (or even awarding a supposed “buyout”) was a proper
remedy was a determination to be made in the Section 9.02 proceeding.
Here, the Arbitrator awarded Dr. Bentz the purchase price for his
membership interest because the Company breached the Company Agreement
when it elected to exercise its option to purchase Dr. Bentz’s membership interest
but then failed to hold a closing and make the payment by the contractually-
mandated deadline. C.R. 1489. Whether the Company breached the Company
Agreement and what the remedy for that breach would be were both issues that
could not be resolved by the limited procedures of Section 9.01 but instead fell
squarely within the broad arbitration authority of Section 9.02 that Appellants
agreed to by entering into the Company Agreement.
2. The Arbitrator had authority to decide the appropriate
remedies for the disputes submitted to him under
Section 9.02.
Appellants claim that the Arbitrator exceeded his authority because there
was “no agreement to award a buyout. . . .” Appellants’ Joint Brief at 23
(capitalization removed). In supposed support, Appellants claim that Dr. Bentz did
54069386.3 - 28 -
not plead or submit a request for a “buyout” if he was properly expelled. Id. at 26.
To begin with, this argument is off-base because the Arbitrator did not award a
“buyout”; he enforced the Company Agreement and awarded Dr. Bentz damages
for the Company’s breach thereof. C.R. 1489. Further, this argument misses the
mark because: (a) there was no requirement that the parties agree to the remedies
selected by the Arbitrator, and (b) Dr. Bentz did seek to recover the Fair Market
Value of his interest, but regardless, that was an issue for the Arbitrator to decide.
a. There was no requirement that the parties agree to
the remedies selected by the Arbitrator.
Appellants argue that awarding Dr. Bentz the Fair Market Value of his
interest was a “buyout,” and that the Arbitrator could not award this “buyout”
unless the parties agreed to it. Appellants’ Joint Brief at 23. As noted above, the
Arbitrator did not award a “buyout”; he simply enforced the Company Agreement
and awarded Dr. Bentz damages for the Company’s breach thereof. Appellants’
argument fails regardless because the parties agreed to arbitrate any dispute related
to the Company Agreement (other than a dispute resolved under Section 9.01), and
in doing so, they agreed to subject themselves to Texas arbitration law, which
gives arbitrators “broad discretion in fashioning a remedy appropriate to the case.”
Roe v. Ladymon, 318 S.W.3d 502, 523 (Tex. App.—Dallas 2010, no pet.). Indeed,
“[t]he fact that the relief granted by the arbitrator[] could not or would not be
granted by a court of law or equity is not a ground for vacating or refusing to
54069386.3 - 29 -
confirm the award.” TEX. CIV. PRAC. & REM. CODE § 171.090 (West 2015). Thus,
Texas law does not require parties to an arbitration agreement to agree on what
remedies may be granted.
In supposed support of their argument, Appellants cite Fortune v. Killebrew,
Gulf Oil Corp. v. Guidry, and Burlington Resources Oil & Gas Co., LP v. San Juan
Basin Royalty Trust. Appellants’ Joint Brief at 24–26. None of these cases are
analogous to this dispute.
In Fortune, the arbitration agreement only called for arbitration to
“determine the amount received by each legatee, and the amount that each was
entitled to out of the estate. . . .” 23 S.W. 172, 176 (Tex. 1893). The court held
that the arbitrators exceeded their authority by awarding transfer of land to the
executor, rather than just determining the amount that the executor should have
received. Id. at 176–77. In that case, the award of land clearly did not fall under
the narrow arbitration provision. Id. Here, on the other hand, Section 9.02 is a
broad arbitration provision under which the Appellants agreed that the Arbitrator
would decide all disputes related to the Company Agreement that were not
resolved under Section 9.01. See C.R. 128–29 at § 9.02 (providing that “any
Dispute under [the Company Agreement] which [was] not otherwise resolved
pursuant to other procedures under Section 9.01” would be decided by arbitration
under Section 9.02).
54069386.3 - 30 -
In Gulf Oil Corp. v. Guidry, the arbitrators were given very limited
authority; they were only tasked with determining whether or not an employee was
discharged for cause. 327 S.W.2d 406 (Tex. 1959). Instead of limiting their
decision to only that issue, the arbitrators determined that “the discharge was
discriminatory; it would be set aside, the employee would be demoted, and would
receive back pay.” Appellants’ Joint Brief at 25 (citing Guidry, 327 S.W.3d at
141–42). Like the Fortune arbitrators, the Guidry arbitrators received limited
authority under the arbitration agreement, and their award clearly exceeded that
authority. But like Fortune, Guidry is not analogous to the dispute before this
Court because the Company Agreement here gave the Arbitrator broad authority,
which he properly exercised.
Finally, Burlington Resources is also distinguishable. 249 S.W.3d 34 (Tex.
App.—Houston [14th Dist.] 2007, pet. denied). In Burlington Resources, the
arbitration agreement at issue applied only to certain existing disputes which were
listed in an exhibit to the agreement. Id. at 37–38. The court vacated a portion of
the award because that portion was based on a dispute that was “not mentioned” in
the agreement. Id. at 45. Here, unlike in Burlington Resources, the arbitration
agreement did not limit arbitration to any specific, then-exiting disputes.
C.R. 128–29 at § 9.02. Thus, none of the cases relied upon by Appellants support
their theory.
54069386.3 - 31 -
b. Dr. Bentz did seek to recover the Fair Market Value
of his interest, but regardless, this was an issue for the
Arbitrator to decide.
Appellants attempt to support their argument that there was no agreement to
award Dr. Bentz the Fair Market Value of his membership interest by claiming that
Dr. Bentz did not plead or submit a request for a “buyout” in the event the
Arbitrator found that Dr. Bentz was properly expelled. Appellants’ Joint Brief at
25–28. However, whether Dr. Bentz pled a claim for breach of contract and sought
damages in the amount of the already-determined Fair Market Value of his
membership interest is inapposite, because arbitrations do not follow the same
procedural rules as court cases. Instead, “the enforcement of pleading
requirements before the arbitrator is a procedural matter for the arbitrator.” Kline,
874 S.W.2d at 782 (citing USX Corp. v. West, 781 S.W.2d 453, 456 (Tex. App.—
Houston [1st Dist.] 1989, no writ)) (where respondent claimed arbitrators erred in
awarding punitive damages even though claimant had not plead punitive damages,
the court “defer[red] to the arbitrators with regard to procedural matters such as the
sufficiency of [respondent’s] pleadings”).
Furthermore, the Arbitrator did in fact rule only on the issues before him,
and the Court must reject Appellants’ claim to the contrary because the Court
“do[es] not have a record of the arbitration and is unable to determine what claims
54069386.3 - 32 -
were submitted or what evidence was offered before the arbitrator[].”8 Id. at 783.
Without a complete record of the hearing, the Court has “no way of knowing
whether a fact issue was raised, or for that matter, whether certain issues were tried
by consent.” Brockman, 2005 WL 2850128, at *4. The Court must therefore
reject Appellants’ argument on this point.
3. The Award was rationally inferable from the Agreement, as
shown by the Arbitrator’s well-reasoned discussion in the
Award.
Appellants claim that the Award failed the “essence” test because, they
claim, the Award does not “‘have a basis that is at least rationally inferable, if not
obviously drawn from the letter and purpose of the contract.’” Appellants’ Joint
Brief at 28; Executone Info Sys., Inc. v. Davis, 26 F.3d 1314, 1325 (5th Cir. 1994).
In support of this argument, Appellants assert that the Arbitrator incorrectly
determined that Dr. Bentz was a member of the Company after his expulsion. Id.
at 28. Appellants’ position is untenable because: (a) the essence test does not
allow the non-prevailing party to retry the dispute, and, in any event, (b) the
8
In fact, Appellants’ claim that Dr. Bentz did not submit this issue in the arbitration is directly
contradicted by a document they did not put into the record. One Section of Dr. Bentz’s
prehearing brief was entitled, “Even if the Respondents properly expelled Dr. Bentz, they
have still breached the Company Agreement[] by failing to pay him Fair Market Value of
his Membership Interest.” See Appendix 11, Excerpts from Dr. Bentz’s Prehearing Brief at 39
(emphasis in original). This brief is not in the appellate record because Appellants failed to
provide a complete record to the trial court, but Appellants should not be allowed to benefit from
that failure—this is the very reason appellants are required to bring forward complete records of
arbitration proceedings in the first place.
54069386.3 - 33 -
Arbitrator correctly determined that Dr. Bentz was still a member after expulsion
and prior to the sale of his membership interest.
a. The essence test does not allow the non-prevailing
party to retry the dispute.
Appellants’ essence test argument is yet another attempt to recast their
arguments on the merits as jurisdictional arguments. But, as the Executone case
cited by Appellants makes clear, the essence test does not permit courts to retry the
merits of an arbitration. Rather, in applying the essence test, “[t]he Court looks
only to the result reached.” Id. (quoting Anderman/Smith Operating Co. v.
Tennessee Gas Pipeline Co., 918 F.2d 1215, 1219 n.3 (5th Cir. 1990)). A “remedy
lies beyond the arbitrator’s jurisdiction only if ‘there is no rational way to explain
the remedy handed down by the arbitrator as a logical means of furthering the aims
of the contract.’” Id. (quoting Brotherhood of R.R. Trainmen v. Central of Ga. Ry.,
415 F.2d 403, 412 (5th Cir. 1969), cert. denied, 396 U.S. 1008 (1970)). In
applying the essence test, the Court is not “limited to the arbitrator’s explanations
for his award. . . .” Id. (quoting Anderman/Smith, 918 F.2d at 1219 n.3.).
In Ancor Holdings, L.L.C. v. Peterson, Goldman & Villani, Inc., another
case Appellants rely upon, the court further explains the essence test as follows:
Our inquiry here is not one of contract interpretation.
Rather, we look to whether the arbitrator’s award “was so
unfounded in reason and fact, so unconnected with the
wording and purpose of the [contract] as to ‘manifest an
54069386.3 - 34 -
infidelity to the obligation of the arbitrator’” such that the
arbitrator failed to interpret the [contract] at all. . . .
294 S.W.3d 818, 830–31 (Tex. App.—Dallas 2009, no pet.) (emphasis added).
Thus, under the essence test, “[e]ven if the arbitrator made a mistake in the
application of the law. . . such a mistake is not a ground for vacating an arbitrator’s
award.” Id. at 833.
Here, as in Ancor Holdings, the Award does not “manifest an infidelity” to
the Arbitrator’s obligations. Like the arbitrator in Ancor Holdings, “it is clear from
the [A]rbitrator’s. . . final award that [he] went through the process of interpreting
the [contract] and that [he] considered the wealth of evidence presented to [him].”
Id. at 831. Indeed, the Award shows that the Arbitrator issued the Award after
“having read the pleadings, heard the testimony, reviewed the relevant documents,
listened to argument of counsel, read and considered the briefs and the post-
hearing submissions, after full consideration of the record upon due deliberation,
construing the contracts and applying Texas law. . . .” C.R. 1492. For these
reasons, the Award passes the essence test.
b. The Arbitrator correctly determined that Dr. Bentz
was still a member after expulsion.
Even if the essence test allowed a court to review the merits of the
Arbitrator’s decision—which it does not—the Award would pass the test because
the Arbitrator correctly determined that Dr. Bentz was still a member after
54069386.3 - 35 -
expulsion and prior to the sale of his membership interest. Dr. Bentz’s
membership interest was his personal property, and Appellants have pointed to no
evidence that Dr. Bentz had transferred his interest to anyone. See TEX. BUS.
ORGS. CODE § 101.106 (West 2015) (“A membership interest in a limited liability
company is personal property.”) Further, nothing in the Company Agreement
suggests that a member stops being a member upon expulsion or that his
membership interest gets “absorbed.” To the contrary, the Company Agreement
suggests that a member continues to be a member until his interest is transferred—
which, here, did not happen before the arbitration hearing.
Under the Company Agreement, upon expulsion “the Company and the
other Members shall have an option (but not an obligation) to purchase all of the
Membership Interest owned by such. . . expelled Member. . . at the Fair Market
Value determined as of the last day of the calendar month preceding the date of
the. . . expulsion of such Member.” C.R. 114 at § 2.05. If the Company or other
Members exercise this option, they must do so within “180 days following the
expulsion of [the] Member. . . .” Id. The party exercising the option must pay for
the Membership Interest “at a closing, held on a business day not more than 30
days after the time for electing to purchase the interest lapses, all in cash or by
cashier’s check. . . .” C.R. 115 at § 2.08. If there is a dispute over the Fair Market
Value, the deadline for closing is stayed until “the determination has been made by
54069386.3 - 36 -
the common appraiser as to which opinion is the controlling opinion. . . .”
C.R. 115, 127–28. “At the closing, the selling party shall deliver instruments of
conveyance and assignment of the appropriate amount of the Membership Interest.
. .” and “the purchasers shall pay the purchase price. . .” C.R. at 115 at § 2.08.
“Upon transfer of any membership interest in the Company. . . the items of income
and loss attributable to the Company Rights shall be apportioned between the
assignor and the assignee as of the last day of the month preceding the transfer (the
deemed transfer date) based on the results of Company operations through that
deemed transfer date.” C.R. 119 at § 4.03.
Based on the foregoing provisions, Appellants had a choice regarding
whether to purchase Dr. Bentz’s membership interest upon expulsion. If they
chose to purchase it, they had to exchange the purchase price for documents
conveying the membership interest at a closing. The Company would continue to
allocate profits and losses to Dr. Bentz until the deemed transfer date. If
Appellants did not choose to purchase Dr. Bentz’s membership interest, then no
transfer would occur, and the Dr. Bentz would remain a Member. Under this
scheme, if an expelled member lost his interest immediately upon expulsion (as
Appellants allege), there would be no reason for the Company Agreement to
provide an option to purchase an expelled member’s interest at all.
The Arbitrator agreed with this analysis of the Company Agreement:
54069386.3 - 37 -
If a Texas limited liability company chooses to alter, in
its company agreement, the statutory rule that a Member
may not be expelled, it must make very clear all of the
consequences of expulsion. In construing such an
agreement no rights or consequences that are not
specifically provided for should be assumed. . . . The
Agreements do not say that a Member’s Interest is
terminated, forfeited or lost upon expulsion. Or that he
shall, from that point, cease to be a Member and his
Sharing Ratio be reduced to zero. Instead Section 2.05 of
the Agreements demonstrates that an expelled Member
retains his Membership Interest. The Company and the
other Members have an option to purchase all of the
Membership Interest owned by the expelled Member. . . .
The existence of the option itself recognizes that the
Membership Interest survives expulsion. . . .
Common sense, logic and a careful reading of the
Agreements compel that, until paid for his Interest, a
Member, even an expelled Member, is entitled to his
share of distributions made by the Company.
C.R. 1490.
Now, for the first time on appeal, Appellants complain that this
interpretation of the Company Agreement treated Dr. Bentz “as if he was a
Member rather than a Disputed Membership Interest.” Appellants’ Joint Brief at
28–31. To be clear, Dr. Bentz was not a disputed membership interest—he owned
one. Under the Company Agreement, a “disputed membership interest” is a
membership interest, the Fair Market Value of which is in dispute. See C.R. 1461
at § 9.01(a). Dr. Bentz was therefore not a disputed membership interest—he was
an expelled member who owned a membership interest the Fair Market Value of
54069386.3 - 38 -
which was in dispute. An expelled member is still a member and a disputed
membership interest is still a membership interest. There is nothing in the
Company Agreement that suggests a member stops being a member when the Fair
Market Value of his membership interest is in dispute. Dr. Bentz therefore
remained a member after expulsion and prior to the transfer of his membership
interest, and the Arbitrator properly decided this issue.
C. The Arbitrator did not award a double recovery, but even if he
had, it would not be grounds for vacatur.
In their second issue, Appellants claim that the Arbitrator violated public
policy by awarding Dr. Bentz the Fair Market Value of his membership interest
and his pro rata share of the distributions made while he was still a member.
Appellants’ Joint Brief at 42. Appellants assert that this award violates Texas’s
prohibition on double recoveries. Id. Appellants’ argument fails for two reasons:
(1) double recoveries do not warrant vacatur; and (2) the Arbitrator did not award a
double recovery.
1. Double recoveries do not warrant vacatur.
Regardless of whether the award granted a double recovery, double
recoveries do not warrant vacatur because: (a) prohibiting double recoveries is not
so fundamental a policy that it would outweigh public policy in favor of upholding
arbitration awards, and, in any event, (b) violating public policy is not a ground for
vacatur.
54069386.3 - 39 -
a. Prohibiting double recoveries is not so fundamental a
policy that it would outweigh public policy in favor of
upholding arbitration awards.
Appellants state that “[i]n order for an award to be vacated as a violation of
public policy, the policy at issue must be a carefully articulated fundamental public
policy.” Appellants’ Joint Brief at 34 (citing CVN Group, Inc. v. Delgado, 95
S.W.3d 234, 239 (Tex. 2002)). The policy against double recoveries, however, is
not the kind of carefully articulated, fundamental policy that could outweigh the
public policy in favor of upholding arbitration awards.
Although Texas’s prohibition against double recoveries reflects public
policy—as all law does—Appellants did not and cannot cite any Texas cases
supporting their claim that the policy against double recoveries is the kind of
fundamental policy for which a violation justifies vacatur. Instead, Appellants
skirt the issue by citing a number of cases reaffirming the notion that double
recoveries are against Texas public policy. See Appellants’ Joint Brief at 37–39
(citing cases for the proposition that “[t]he policy against double recovery is firmly
rooted in Texas jurisprudence”). But Appellants miss their mark. The question is
not whether Texas has a firmly-rooted policy against double recoveries, but is
instead whether the public policy is so fundamental as to require courts to upset the
strong presumption in favor of arbitration awards. The answer to the latter
question is “no.”
54069386.3 - 40 -
At least two courts of appeals have held that awarding a double recovery in
arbitration is not grounds for vacatur. In Black v. Shor, the Corpus Christi Court of
Appeals rejected a non-prevailing party’s bid to vacate an arbitration award on the
basis that is violated the one satisfaction rule. 443 S.W.3d 154 (Tex. App.—
Corpus Christi 2013, pet. denied) The Black court held that “[a] trial court should
not overturn an arbitration award rendered after honest consideration given to
claims and defenses presented to it, no matter how erroneous.” Id. at 168–69 (Tex.
App.—Corpus Christi 2013, pet. denied) (citing Xtria L.L.C., 286 S.W.3d at 598);
Werline v. E. Tex. Salt Water Disposal Co., 209 S.W.3d 888, 898 (Tex. App.—
Texarkana 2006); aff’d 307 S.W.3d 267, 268 (Tex. 2010)). Similarly, in Roe v.
Ladymon, the Dallas Court of Appeals rejected Appellants’ argument that an
“award should be modified to eliminate a double recovery of damages,” justifying
its holding on the arbitrator’s “broad discretion in fashioning a remedy appropriate
to the case.” 318 S.W.3d at 523.
Although Appellants cite several cases analyzing arbitration awards in light
of public policy, these cases do not support Appellants’ argument. In one of the
cases cited by Appellants, CVN Group, Inc., the Supreme Court of Texas rejected a
public policy attack on an arbitration award, reasoning that the “arbitrator’s mere
disagreement with a judge does not violate public policy [and] [n]othing in the
arbitration proceeding indicate[d] that the arbitrator completely disregarded the
54069386.3 - 41 -
[law].”). 95 S.W.3d at 239. Furthermore, in none of the cases cited by Appellants
did the court vacate an award on the basis that it granted a double recovery; rather,
those cases vacated awards that violated the Constitution, were unconscionable,
encouraged criminality, or violated a statute that prohibited unconscionable
conduct. See Lee v. El Paso County, 965 S.W.2d 668 (Tex. App.—El Paso 1998,
pet. denied) (affirming vacatur of award that violated Texas Constitution’s
prohibition on “freely giving away [of] public moneys for services previously
rendered…”); Lee v. Daniels & Daniels, 264 S.W.3d 273 (Tex. App.—San
Antonio 2008, pet. denied) (vacating award that granted lawyer recovery against
client for fees lawyer incurred in representing himself in securing withdrawal from
ongoing litigation because it was unconscionable for a client to pay a lawyer’s fee
for service performed for the lawyer’s benefit); Smith v. Gladney, 98 S.W.2d 351,
352 (Tex. 1936) (vacating award that enforced gambling agreement); Goodyear
Tire & Rubber Co. v. Sanford, 540 S.W.2d 478, 483–84 (Tex. Civ. App.—Houston
[14th Dist.] 1976, no writ) (vacating award that found employer’s action proper in
terminating employee for filing criminal charges against supervisor prior to
exhausting grievance process, because award discouraged disclosure of criminal
activity and delayed justice); Rapid Settlements, 234 S.W.3d at 793 (affirming
injunction against confirmation of award that violated statute requiring court
54069386.3 - 42 -
approval of structured settlement in order to prevent abuses of power against
unsophisticated tort claimants).
Unlike the public policies addressed in the cases cited by Appellants, the
policy against double recoveries is not the kind of fundamental policy for which a
violation warrants vacatur, as the Roe v. Ladymon and Black v. Shor courts
recognized. For the above reasons, the trial court properly honored the public
policy in favor of upholding arbitration awards, and this Court should do the same.
b. Violating public policy is not a ground for vacatur
under the Federal Arbitration Act.
Regardless of whether the Award includes a double recovery, the Award
should not be vacated because the common law ground for vacatur Appellants
assert is no longer a bar to confirmation.
Appellants note that the “[t]he United States Supreme Court has determined
that Sections 10 and 11 of the FAA are exclusive of the common law grounds to
vacate an award.” Id. at n. 17. Indeed, the United States Supreme Court has made
clear that common law grounds for vacatur no longer bar confirmation of
arbitration awards because the grounds for vacatur under the FAA displace and
preempt common law grounds for vacatur. Hall St. Assocs., L.L.C. v. Mattel, Inc.,
522 U.S. 576, 584–89 (2008). Since that decision, this Court held in Royce
Homes, L.P. v. Bates that, where the FAA applies, state common law grounds for
vacatur (like an award violating public policy) do not apply. 315 S.W.3d 77, 90
54069386.3 - 43 -
(Tex. App.—Houston [1st Dist.] 2010, no pet.) (“We have already held that the
FAA applies to this case. We conclude that Hall Street forecloses any common-
law grounds for vacatur of an arbitration award such as manifest disregard of the
law and gross mistake.”); see also Petroleum Analyzer Co. LP v. Olstowski, No.
01-09-00076-CV, 2010 WL 2789016 (Tex. App.—Houston [1st Dist.] 2010, no
pet.) (“. . . statements that the arbitration panel ‘exceeded its power’ in granting an
award against public policy. . . are statements couched in common law arguments
that do not provide valid grounds for vacatur of the arbitrators’ award.”) (citations
omitted).
As Appellants admit, both Federal Arbitration Act (“FAA”) and Texas
Arbitration Act (“TAA”) apply here. Appellants’ Joint Brief at 13 (“. . . the FAA
and TAA apply concurrently.”). They admit further that “the FAA supplies the
substantive rules of the [confirmation] decision.” Id. at 14. Because the FAA
forecloses common law grounds for vacatur like an award violating public policy,
Appellants’ public policy challenge to the Award must fail. Furthermore, the cases
Appellants cite do not change this analysis because they predated this Court’s
controlling decision in Royce Homes. Compare Royce Homes, 315 S.W.3d 77
(2010), with CVN Group, 95 S.W.3d 234 (2002), Smith v. Gladney, 98 S.W.2d
352 (1936), Goodyear Tire & Rubber, 540 S.W.2d 478 (1976), Lee v. El Paso
54069386.3 - 44 -
County, 965 S.W.2d 668 (1998), Rapid Settlements, 234 S.W.3d 788 (2007), and
Lee v. Daniels & Daniels, 264 S.W.3d 273 (2008).
2. The Award compensates Dr. Bentz for separate injuries and
therefore does not grant a double recovery.
Appellants claim that the Award granted Dr. Bentz a double recovery, but a
double recovery only occurs “when a plaintiff obtains more than one recovery for
the same injury.” Waite Hill Services, Inc. v. World Class Metal Works, Inc., 959
S.W.2d 182, 184 (Tex. 1996) (citing Stewart Title Guar. Co. v. Sterling, 822
S.W.2d 1, 7 (Tex. 1991)). The damages recovered by Dr. Bentz are not duplicative
because they compensate Dr. Bentz for separate injuries: the Company’s failure to
pay Dr. Bentz for his membership interest after electing to purchase it and the
Individual Appellants’ wrongful appropriation of Dr. Bentz’s pro rata share of
distributions while Dr. Bentz was still a member of the Company.
Appellants’ argument that Dr. Bentz was awarded distributions twice
ignores the fact that the “Fair Market Value” is the required purchase price for
Dr. Bentz’s membership interest— not a reflection of damages sustained by
Dr. Bentz before the purchase of his membership interest. The purchase price
would be the same whether the Company distributed $0 or $3.6 million between
the expulsion and purchase, because that is what the parties agreed to. See
C.R. 118 at § 4.01 (“At such time as determined by the Executive Committee, Net
Cash Flow…shall be distributed to the Members in proportion to their Sharing
54069386.3 - 45 -
Ratios.”) (emphasis added); see also C.R. 136 (establishing equal sharing ratios of
20.0% per member).
In creating the Company Agreement, the Company and the members had a
number of options to determine what price would be paid to an expelled member
on the date of transfer. They could have agreed that the purchase price would be a
sum certain. They could have agreed that the purchase price would be a multiple
of the profits the Company received in the calendar month preceding the transfer.
They even could have agreed that there would be no purchase price, and that an
expelled member’s interest would simply revert to the Company. But they did not.
Instead, they agreed that the purchase price would be the Fair Market Value as
determined on the last day of the calendar month preceding the month of the
expulsion. C.R. 114 at § 2.05.
By defining the Fair Market Value based on a date preceding expulsion, the
Appellants assumed the risk that the value could increase or decrease dramatically
between the date of expulsion and the date of purchase—or even between the date
of valuation and the date of expulsion. And by allowing a member to remain a
member until the transfer of his membership interest, they agreed that the member
would receive distributions regardless of the extent to which the purchase price
(that is, Fair Market Value) would have been based on an estimate of those
distributions.
54069386.3 - 46 -
Thus, it was not a double recovery for the Arbitrator to award Dr. Bentz the
contractually-mandated purchase price (Fair Market Value) as damages for the
Company’s breach of contract in addition to his contractually-mandated share of
the membership distributions.
D. Even if the Court were to vacate the Award, it could not order the
modification that Appellants request.
For the first time on appeal, Appellants request to “vacate” the entire Award,
except for the Arbitrator’s findings that “Dr. Bentz was properly expelled and there
was no breach of the [Company] Agreement by the Appellants.” Appellants’ Joint
Brief at 42. There are three problems with this argument. First, the Arbitrator did
not find that “there was no breach of the [Company] Agreement by the
Appellants.” Id. The Arbitrator instead explicitly found that the Company’s
failure to hold a closing and pay Dr. Bentz by the deadline was a breach of the
Company Agreement. C.R. 1489.
Second, Appellants request—for the first time on appeal—to modify the
Award in a manner that differs from the modification that they requested the trial
court make. See C.R. 1413–44, 1591–94, 1605–23, 1776–80, 1801–07, and 1953–
61. Because Appellants did not present this argument to the trial court, they
waived this argument on appeal. See, e.g., Kline, 874 S.W.2d at 790–91.
Third, Appellants request modification of the Award—not total vacatur—
and the requested modification is impermissible under Texas law.
54069386.3 - 47 -
Section 171.091(a)(2) of the Texas Civil Practice and Remedies Code provides that
“the court shall modify or correct an award if…the arbitrators have made an award
with respect to a matter not submitted to them and the award may be corrected
without affecting the merits of the decision made with respect to the issues that
were submitted….” As previously explained, the Arbitrator only decided matters
submitted to him. This alone renders the requested modification impermissible
under Section 171.091(a)(2).
Additionally, Appellants’ requested modifications to the Award are
impermissible under Section 171.091(a)(2) because modifying the Award would
affect the merits of the Arbitrator’s decision. If a court determines that any portion
of an award is invalid, and the “invalid portion is not severable and distinct so that
the remaining valid part of the award truly expresses the arbitrator’s judgment,”
then “the entire award is void.” City of Waco v. Kelly, 309 S.W.3d 536, 551 (Tex.
2010) (citing Guidry, 327 S.W.2d at 409). If a portion of an award is rejected and
any part of the award is to be maintained, “it is indispensable that the part thus
allowed to stand should appear to be in no way affected by the departure from the
submission.” Guidry, 327 S.W.2d at 409 (quoting McCormick v. Gray, 54 U.S. 26
(1851)).
Here, no portion of the Award was invalid, but if the Court were to decide
otherwise, it would have to vacate the entire Award because the issues determined
54069386.3 - 48 -
by the Arbitrator were not severable or distinct. Dr. Bentz’s expulsion triggered
Appellants’ option to purchase Dr. Bentz’s membership interest and formed the
basis of Appellants’ claim that Dr. Bentz was no longer entitled to distributions, so
these issues are factually and legally intertwined. Thus, the Court’s decision here
is all or nothing; it may vacate the entire Award or let the Award stand. And the
Court should do the latter.
CONCLUSION
For these reasons, Dr. Bentz respectfully requests that the Court deny the
Appellants’ attempt to re-litigate this case, deny the Appellants’ request for
improper modifications to the Award, and affirm the Judgment confirming the
Award.
54069386.3 - 49 -
Dated: July 8, 2015
__/s/ Andrew Price____________
Andrew Price
State Bar No. 24002791
andrew.price@nortonrosefulbright.com
Rachel Roosth
State Bar No. 24074322
rachel.roosth@nortonrosefulbright.com
James Hartle
State Bar No. 24082164
jim.hartle@nortonrosefulbright.com
1301 McKinney, Suite 5100
Houston, TX 77010-3095
Telephone: (713) 651-5151
Facsimile: (713) 651-5246
Counsel for Appellee Alan Bentz, M.D.
54069386.3 - 50 -
CERTIFICATE OF SERVICE
I hereby certify that this instrument was served upon all counsel of record—
whose information follows—in compliance with Rule 9.5 of the Texas Rules of
Appellate Procedure on July 8, 2015.
Robert A. Plessala Adam M. Looney
Andrews Myers, P.C. The Strong Firm, P.C.
3900 Essex, Suite 800 Waterway Plaza One
Houston, Texas 77027 1720 Hughes Landing Blvd, Suite 200
The Woodlands, Texas 77380
AND Counsel for Northwest Houston
Emergency Specialist Group, PLLC;
ESG MD, PLLC; and ESG MLP, LLC
Matthew J. Mussalli
Law Office of Matthew J. Mussalli, P.C.
2441 High Timbers Drive, Suite 220
The Woodlands, Texas 77380
Counsel for George Davis, MD;
Anteneh Roba, MD; Levon Vartanian,
MD; and Woodrow Dolino, MD
____/s/ Andrew Price______
Andrew Price
54069386.3 - 51 -
CERTIFICATE OF COMPLIANCE
I hereby certify that this brief complies with the type-volume limitation of
Texas Rule of Appellate Procedure 9.4(i)(2)(D). Appellee’s Brief contains 12,413
words excluding the parts of the brief exempted by Texas Rule of Appellate
Procedure 9.4(i)(1)). This brief was prepared with, and the word count generated
by, Microsoft Word 2010. This brief complies with the typeface requirements of
Texas Rule of Appellate Procedure 9.4(e) and the type style requirements of Texas
Rule of Appellate Procedure 9.4(e) because it uses a proportionally-spaced
typeface using Microsoft word in 14-point Times New Roman font.
________/s/ Andrew Price____
Andrew Price
54069386.3 - 52 -
APPENDIX 1
CO-..PANY AGREEMENT
of
NORllfWeST HOUSTON EMERGENCY SPECIAUSTS GROUP, P.LLC
A Texas Profuslonal Umitod Unblllty Company
Tht6 COMPANY AGqEEMENT of NORTHVVEST HOVS fON EMERGENCY SPECIALISTS
GROUP P L L C (this •Agroem011r), dated as of JutJ 5. 200e (lho '["(fc>Qtvo O~o). 1$ (a) utlopl ·d
by tho ~nagors (as d fined In SectiOn 5 01) and (b) executed and agtGed to for QOOO 81\d va!uob!o
ooosideraoon, by the t,tembera (as del'ned 10 Section 2 01 )
Artkle 1
Org;,nizat.ion
I 01 ForrrwtiOfl NORTHWEST HOUSTON EMERGENCY SPECW.ISTS GROUP,
P L t. C. (the "Company") h&a boen organ~Zod as a Texas profess10nnl hmtl&d llablhty company by
tho hllng of a Cortlflcote of r ormotlon (the "Certificate") under and pursuant to the ToxHt' But~irlc~s
OfgMizntlons Code (as omondod from 1lm~ to tin1tt. too "TBOC1 and lhe lr.suance of a cort1ficntc of
flllnu 1(>1' U.u CompAny by lh& Sooreli!ry of State of Texas.
1 02 Name. lhe name of the Company i:o NORTHWST H OUSTON E.MERGENCY
SPECIALISTS GROUP P . L C ond all Company buw-ess mu:;t bo conducted ,.. that nJme or
$uCh olher n:Jmes that may be seloctod by the Exewtrve Comm neo (as dehnOd 1n St'ICI<>n ~ 0 1l
and that comply 'Mth ppl bfit law.
1 03. Rt.tgr$ttNGd O.'f;w: RogiSl6f'8d A{llt:nl. Off/CO$ The regtslorec Olftee and rogtslorctd
agent of tho Company in tho Stlal of Teli.aS sha l oe as 5pocafiod '" lho eert.r.cate or .tsde~hld
by thu E)r.OQihve Commltzeo in tho manner provided by apphcabte law. Tho off!Oe$ of the Ccmp;.,my
61\811 bo at 5uch plaoc:t es the E~UKutwe Coi'JUTI4tt9e may dostgnalu. nhlch need not be W'l tho Stato
Of TOdS
1 04. Purpose TI1~ purposes ol the Ccmpany are to provtdo und rMnnge ph~lclon and
modteal $OMces and all other purpo$0$ under the Cetltf.ea:e or the TBOC forwh1ch profo"sionotl
ltmttcd hatX ty ocmposl'• may be fonned.
t OS. FOfe'9Jl OualtfJcst1011 Pr.or to tnc Comp:~ny's conducttng buSII\eSs in anyJurisdiCiion
othor tnao Toxas. lht: Exc:culive Comm:.nee shall cauu tho Comp:my to comply With all
ntqu~r\ln~nts necessary to qua tfy lho Comp:lt'y ~ a foretgn kmtted habillty company '" th,Jl
JUN;dtction
1.06 Term Tho Company oommencod on tho dote tho Secretaty of Stale of Texas ts.suod
a oortiflcalo of flh~ for ll•u Company a.nd shall conooue in oxestonoo ror tho periO Attlole 2
Memborsh p Dispositions of lnterost5
2 01 M mi>Of'3' Srnmng RliiJOS: Vot,ng Rlgfll$
r
(a) MombVr$ Thu ntCmbt:rs of ll"'c Company AfctmOcrs1 ate the incWIOuats ex.oeutmg liU
1\gr~~• 88 ot ltle dato hereof aa momoors and each perGOn thnt , horc3ner oom noo to tho
Comp· ny o "' mcmoer .n a(OO(danoe With thl! Agreemenl, proVIded that. In accordonco with
aecuon 30' 004 o' tho TBOC. each Member adrr?.tcd hc~r und herc~fler Is o ph)'5i=n
ltwo t:d oo dUly quahlieO to p(()Yide medK:SI seMc:es l'ltho Sta~ of Texas and an aulhonzod
penon, as such term" t.~d soc;t,;on 301 0~ o' :he TBOC (•AulhMZed PersM•) If a Member
$IW" have mode e Of!poslbiOn of ell or any portJon of 1ts MGmborsh•P lnl~t but shoal! IIU rotalnucJ
a.ryy ~hts th0fC111, then sol· wtlh respeet te ~ Membei'SI\9 lnt•raat (or poruon lt1efoof) ao
d sposed, ell remrenoos 10 W.ombor" that appear ir1 Mete 4 ones Soct()C\ 8 O?{b) h 11 be d...~ ad to
refer lo l'ho l:>!ll!'Jr'ICo of suCh Menlbctshjp Interest The Members collectJY-orl shaH bo roforrod to s
the 'Croup •
(b) Shoring RollO$ Tho Slwdng Hnllo Qf eacl\ tnlllsl Mombar (eoch a 'FOt1nd11,9 Mom/Jar'
and ~«lv~Uy U'a " rOI.III.fiJJ?O Members'} 6s set fonh Of\ Exhibit A.
(c) Votl..rtg Highr~ fho Founding Members shall oach (I) 1>0 unt1tl!o And (IIJ 11:1\00 o
voting lntoro:;t oqvul to tho rQtrO ot such Member's Sh8rfl9 RatiO to olllho t\1 mbcrr.' onllllcd &o vote
Sllonng Rai.IOS ("Votmg ShOnn,g Ro110s1 All olhc; Member!$ eJn~ ("M9mlJurSI11D
lnt9ro.s!"'l. ex~1 1n acoord~neu \YIIh the proviSO'IS 01 ttvs Agroomonl
2.03 Ol$po$!tton by • Milmber. In tne event a "-to~r ,h,,n 0 po~ of rry ul such
MemDer's lntere$1. fOf On) roawn whaltoevd' toeny pert...on or ont.ty Who rs not alroed)l a l,lombcr
1the ltmo of 1~ 06poSlliOn, then (a) tNt tJansferoe or such "''~'e" hOn •n
ecorcsance tth sectJoo 301 009 of lho TBOC. but sh nnot be .. Murnbet un;ess a"'d until &J~Pro~~,.,
adlll!ltod to lh(: Coml)llny s Ot~ided $n Sec:~on 2.10 of lrl&S Ag'Mment: Md (b) he ComP~JnY uud
lhe t,tembofs sha hove tho f19111$ Ond opllol'l$ ~r~aded rOt In lhl' AttlcM 2
2 04 VolmHu&ton I t1xttS (lht' · I IO.'IJ)trfl{ ) o
Mom bar muy llan10fUt' hi~ rmmb()nshlp lnlhrest upon the U11Gnmoua W01l0fl consent o#lho l?lCoovthro
Comrmuoe and '" accordanco wtlh this Article 2 In ltiu e"Yent ooy t.tambor tine • rransfomn-:J
h~mbct ) dusrtes to O.sposo of a.ny of such Merrber'sl\t.arnbcrshlp h\ICte ,,., (C()tcJ.mco v.tth Ill&
prooodulg &OntGf\00, Jueh Mornbet shal. by wtttten notliCe llhe ·offonng Notn:o•) gr..,.n o lt1e
Company and to each othef Membor oncr cxdU$rveJy "'d lnt:vocably to ~II aD lha Member~
lnlcrt;:.l $,Jeh Membef des1rea to Dispose of to U\8 Company and tho ottlor Mcmoors Thti notict:
ahaM1tato (a) a de~plion of lhC r.tembeP..h•P ~e~ des..rethe Stwmg RollO bcrng ol'"''"d fOC' S3k1 (b) the~ (lhe 'Otr&ll){} Pri.."8') and O"'-."f terms uPOn
~Nhlch that
Membe• d~rrcs\0 DISpose of lll9 M6m.bef&hp ntotal (PfO~JidCd l · 111 thOro 110 or
only nomln I eorn;idun;tiOn lor tne O~on 11\e Off~ng Price deemeo \o be tho Fair
I.lor...at Va"'- (as hmMr.aftor def ned) of the Mem~hio lnlt:r\:."1 tlutctm•ned In llcx:ct040C'e ttl
S«t!On 2 09 ht:h!ln) (c) the amoUf'll&nd natt.e of MIY IJens or encumtnnc:a:; oaa rm!Nt nlOfUI.
(d) ~!hot tho I Mcmbor .a n dcfaiAt I.W'Oer any ()'O'U'~
olher lt'tm Che '·' rr.betsh'P L'l!~l v.'ill be sold n the ev.1t ne~ther tho Company
nor the IAembefs elect to buy 11 Tha Coml)3ny a~ the "''ctt'.Oetl h. Ill•" 1 •o, urrd• r
ttl Soct101l2 04 II at a \\ hln U lime and 10 trl2 manner pro~ •n Sot!1001 2.07 throun 2 09
herern fall tho ~'P lniOI0$1 ~Ito be O.:sl'()Sed of l.ttlder tills Sccben 2 04 (Of' unaer
Section 2 08 bt:IO\\) ts not so pord\ased b'J tne COf!Wfli' or the olho1 ~~be~. tho Tronsfarnng
r.tombot may 0i:..pQS4J or &he Mt:·nb tntenm o.med bt
such decca od Of c_l(pcll•d Mombur at the tim!! of such Msrnbola do..-alh Of expo· ~n ftllh r:a-7
1.1. rto:etValuo delorm•nod uof li'olcntd;;ayof trt.:ealendarmon:h pll!CI!!Cngthedalo ollhoC®Ihor
expu!s.Of' ol $Uch Mu·niJcr. l ho Company and :he o:h6r Mcmbtt's ~II elUlrOISe lhetr opl under
UIIS Section 2 05. I at al Wl' lhu IOtt:QOII'IQ 18tklay periOd n ltiC rno.nncr ~ided 10 SoetQns
.2 07 1111uugl\ 2 OlJ I'W!te•n
2 06 EnaJf71bnlnce,lmiolunl;.ty Olspa!.A/JOII AA'f lMJ)OSilJotl of a Mambefsh p lnlCJV$1 (u)
pu,UI'Iolt.o n plt:dga, mortg8ge, or other encunbf'a"'CC of 1 Mt:r'Obenlh p lrterl!sl granted by a
Member to liocure ad~bl at O:hor obhgauon 'b) purs-~ot to a bankruotcy Of Jn~l~ :KY oto~lftO
or u Mombe.r. (c) pursuant lo i'u' Article 2, II et•ll by nr.omg wniiM notice (s ~Response Noltce•) to tho Trans'errlng Mombor or
other tnu\storor v.ittun the 30 oaya after I'CC£fPI otii'JC Oflt:finO Nollot; os to wt\el! r too Comp9ny
OKIOCOQ to pun:tw· u -'~ Or any part ot tile Mem!M:!I1>tlop lntQreS1 &Ough~ 1o be dispcnee of, I lllu
114
ComP3ny does 001eled 10 purmase 811 of such Membership lnteroat. the Company 5hallgt'io to
ad\ of he other Member$ oopy of 11 .e Ofterir.g NotiCe and Its Rtss.POnse Notice, arld each of the
olhef Merr.bers &hall, WIIIM 30 day5 after tne ~;pt of l."'e RespotlSO No1100 rrom 1t1o C«t1rnany,
gn.c a R..:~pOil$e 1\'0hoe 10 the Compsny as !0 "ht:!her sl.l1:t\Membef utoc::a 10 purttl3SO any ot suCil
•,4ambership lnte'95! not to be purc:Msod by CI1U Compaoy The Comp~tny eMil g:v~: ,, cop~ otlh:ll
Respot~e NotiCe to l.ha 1ransferrlng Member or other transferor ond each otharMor'I\DOr ...,flo a~
gYve an C~ffiru ~CtiJ''V Rc~f,lu u:.o NUll~ I' n!Qfe th~n on~ t.l\lrrlllur tftldt> to purctj among lt'O ~Mbcrs v-ho dcslfo to ou•ch3:~rt 11
t the "Purclln$.!/lp McmbcrY') rn such proporoons a they msy agree u~ or in th9 absence of suet~
agrooroont, pro rata occ:oro~ to tho rctatJvc Sh~ Ra·~s then llUid btlho Pun:hurng M ~
2 08 P.ymcnt ol Pvre/l..'l$fl Price· D¢!.1very Df lns.!n.unents of Conveyancil. The
MambeBt\p ln:erest \lftliCh ~ected to be pun:tlased uodor this M idhtp lnl~r&st tor pw~X>'BS o l tMt An tela 2 ShaD DO ll'lo ~.air mnr..r.t
vtJiuc llhu •Ftu M.wStet Vs.'u~n of such Memt>erEJ-W.p nt~l. Mt:rr.betat p lnu:resl te de1ermned on It"~ basts that 1'0 "ldMdua or t'l'\llty O"'f\11\9 that
M ~P tniOte$1 Nls \~ ' 'Dhlto Yi••hdr.;.v ·~ Mc::mbe4hiP lr, a:te• I from the Mc:mbt!r:hl) o:
cause me Membor5hip 10 temMale and q.Ddate be"ore the end of tho tenn or tho Corrpany
Tllflt :ort: f1lO r- lr f,1&1(t!t Voloe cf My fl~mbelsnlp fntc:·esl &hal be de!ermin~ UNSer 1
a"u:np\IOn thnl Ch only dl$1iibuliOOS lh91 " be made 10 lht; owner olll1ill t.tumbt·rShiJ) lnto•t ~ WIU
be tnat M&mbetahtp lntero,l'l proportJoos:e Share of lne cash d&s:ntfvcaoce to U~ Compuny or uny cot>I& or t::lt~Mt~ ..
conrltt!'C!Mi v.1:n tie a.o;algnmont or otner d~posttioo Of assuroncos from the P'Jrtha•or of such
nloro:.t lhol t•X)Su ·•·nounts will btJ p od .aI Utt~ 1.1na t'le sate ctos.ecS.: (d) ottutanee that tho person
to whom tho assign'non' Ot olhor dispos lian Is lobe wade It Wllling no ublo to ~rlofm fill ol 1111:
5Cll•nQ l'l}r'!y's ol1••uu or'' Uti«Je.r lh.:s AgreerrenliS an .A1Jt:"o'1zad Pee-son o•"' ,.. not ~noo tcnl
Notwithstanding the aatl5feetlon of the foregoJng requlremonta. :.ny Di•poaiUon of :1
Membel'lhlp lnteraat ehall be offoctive only to give the 4.SSfgnea U\O fight to teeei~Ht the share
of profita to whk:.h tn. assignor would otherwise be entitled end ahall not raflovo s uch
oulgfl1)( from any llabUny or obllgatJon under any provisioM or thl1 Agrnmont or gtvo •uc:h
assignee the rtght to becom. a svb81itutcd Morobor. vnlo . .s and until such assignee m
expreuly •dmitted to lhe Company by the Exeeutlve Committee as provided above . Tho
b'--cu\lv~ Comrr .r.ee may grant or ~Mhold such adm~•on ., th ;.e,lo o Clc' ot or 1 [ ' t:CU!IVO
Con•m•ttco EOeh Momt:et undcrs!Jinds and agrees ·nat 1M reqwomentsand ~:n:tJcns c:ont..Mlod
In this A.rt)Qo 2 an! I'Ba$0N)blo end oboolulott cS5Ctltirs upon
tho unanimous written oonscnl of lito Beocuto o Jo-ndo• ogrcamont (tn a form pcomulgtttod I.Jy tltu F..xoCtJII•m COmmllluuJ 10
lhl':l AgreE>tncnt agrllelng to bo bound by the terms and conditions of 11\11 Agrcc-nonl Tho E;4 utvo
Commtttoo may ruflIQI'I of any ne\Y '-'embet1l etlhe c.:testiCJf\ ol any tl::.v ~~ ot group
of Merrbcrs m an omeodmant to Uti$ Agroorr.cot lh o Ctlnd :.on to ldN II neo AS A
116
CONDmON TO ADMIITANCE, EACH ADMrrTED MEMBER, EXCEPT FOR THE FOUNDING
MEMBERS, HEREBY AOR£ES THAT SUCH AOMfTTED MEMBER SHALL BE A NON·VOn NG
MEMBER WfTH NO VOTING RIGHTS HEREltf OR PURSUANT TO THE TBOC. AHD SUCH
ADMilTEO MEMBER HEREBY WAIVES THE PROVISIONS OF THE TBOC THAT WOULD
OTHERWISE GRANT SUCH MEMBER VOTlHG RIGHTS IN TliE COMPANY, INCLUDING,
WlT HOUT LIMITATION, THOSE PROVISIONS IN SECTlON 101 356 OF ntE TBOC
2. 12 WdhM""JW rt Su~ 10 ~ h.i~ ne eoocf ~.on: or Sect.on 2 04 • *-!ember do
11'\e natt.ra of the bf'8Kh and fn·l5 to o,;~ wch orc:act• ~'o for thoGo now.'O!i11q Mombctt. or
OGIIISJnOOU or ropruult\13 soction. or (c) of lnformat on lNl Member ~'$0 has receNed from a source Independent of tho
Co-npcny INti the Aember reasonably be&eves cb:arned that IOf1TI3tJOn wl!hovt br ch of any
obl•galion of conftdcnt1ot ty The P\1 mbetS ae)(nc-.-Jedge :hat breach of ltlo prooa10ns olln&S soc tort
nuy cau!e parable iriu!Y tc tho Con,pany for which mcntl;)ry d m.'lgH arc 1 d lu. dtt1tcult
to compu • or both Accordingly tne \1ell'.bers agree that the proviSions of tht$ 1oclion may b •
en'oroed by &pcdfc porfcxmo~ a~ bY the expulsiOn of such Aember from the Company
2 17. Moml>Or Rt;qiWOmeniS. EaCh Member Sl\:81 be teqwred to pt'O\ide medical SOMCOS
at the Hospital for a minunum of 4Mflhl (8) sh10s per eet::t ~,month 01 as otherwl$1) dOtertn~lled
by tho E.Jti'ICUlfllu Com '' (lhe "IA•n•mum Monthly Comm.tmonr) If • Mcmbor rs unnblc to moot
the t.' um Month yCom!1\Mler'IL then the E.xecutiv~ Cotr •mtlc-e shall have the nghtiO odJustaoo
pro-rule ~'UGh Member's ~the Otnef Memoer'sShaong Ra·o n 'hom oncr cf larm,nOd by the
~OCUIJYO Commtlloe
Article 3
Capital Contributions
3 0I lrrlti:JI Conlrlbull'ons. Contem porar.eou~with thu OMIWiiOn t>y such 1\'ember of U"44S
1\groomonL oooh Mombor ~tlol1 rn:lk(l lha contnbullone to tho capitol of tho Company ("C•tP#Iill
Contribv/10n~) do:son bod lor !hal Member 1n Exh[blt A.
3 0~. Sub..'feqUftlll Contllbutlons No member sht~ll b4: required to contnbu&a odd tJonal
capital to the Company
3 03. Rutum o1 COflflll)ufJOI)$. A Metnber IS not ont1tlcd to the rerum or ani' p n ol ts
C.p•Utl Contnboltons or to be poid intet~st 1'1 respect of e.ther 115 capita eccor.mt Of tt .. C&P•Lll
Conlribulion'\ An unrepaid CaPital Con\ributon IS no· a h.\bU ty or~ C()mpanforor any .1omtcf A
Murr.bef " not required lO c:ontnbute Of to lend any cash or propc:1y 10 the Con panyiO cn:J~ the
Corn;>l'ny to ret..-n any Membet'$ Cas;. tal Ccn~tJOM
3 04. Advanoos by Milmt>Q4 If the Ccmp3J'y does not ha~to &ufficiene e: ~ to p.1y IIll
obigatiOOS, uny Member{a) L'lal may agree to do so with tne consent of the Execu:ilto Com111t1t. .
may advance all or part or lho n~:e&:d funds to a on behalf or the Corr.p:)ny, :tt such tnlafc: 1nne
uno ~ sYCh other term& as such Member ~rd the Execu:JVe Corrm UQO may~.. An odva~
acscnbod 1n th' Sect~ 3 0~ cons :utes a loar from Ito l.lcmhl-r to the Company and not a
Capital Contnbuoon.
Article 4
OlstribuUons and AJI~tlons
4 01 Dlstnbullont AI suet. lime as determine Suction 4.Qt) fOf' each fiscal year (or such liJ'IOrlot l)(lriOd ror whiCh the
dlatrlbullon Is maclo) shell be dl&lrlbutcd to UlO M'-mbers In ptoporuon to tholr Shanng Rollo& Tho
torm 'Not Cosh Flow· t.llOII meBn off cash funds derived by tM Compony (InCluding lntaroat rocoi'X!. and CUytnt:tll$) debt payments. ca;Jital improi/Olncnt:.- tOplt-tct:me.nts and t:Stabllsh
rca&anoblo l'e$ON05 for futuro Ol(pCtl$e$ elld costs as deteml•ned by tho E.xocutivc Comm ltuu utiIll>
solo d~SCieliOn .
4 02 lftstnbOlions f01tnoome Taxt4 No!\\rth.Sta."'d;ng tho PfOV s10ns of Soction .s 01 , tho
I
118
E>ct...c:utrvu Comrn•ttee shall d•stttbute sufficient cash CK ol.hor hqutd sse.:Is annu:illy to UY.: r.wnbers
to enabto 5uch Mc~rs 10 p y nny and ail lllClOI'C'..e taXes ncurrad by ""ch Mombors tnat ••o
attnbul$ble to the Ohn«ship of Mernbef'5hip 11\iClesiS in the Con p ny, except fcw thos ta•a
IOd 10 o Mcmbet's so ry Ot' olhel oon'pensa~
4 03 Affocat10,. of Profits ond Lassos
(a) Genera.uy Except as otnerwis.e PfO~ in UliS MciO 4 , each item of Company lnoomo,
gatn, los... cktdue1ron encs Credt: (ltlcludng nontaxable losses dosetlbGd •n acct.on 705 of lhts Un•lod
Sutos lntemat Revenuo Code ol 1986 as amended. (!he ·coctc)*J) shsdl be &Doc:a~ among the
~ bet1ln soc:ctdance w•tn the r rospacu\19 Sharing RaiJ.mo gain loss,
and doducbon with roapott to. ny pto~t1y contf'lbuted to tne CO:l' tot of tho Company shuty Regu 3trons ~ecr..on 1 704-21()
(b) Cht1fVObolcJc of MU\ln~Um Ga.n Atlribul3bt'8 to l.fomoor {l,\onroo(;IJ('$JC Dc.'bl. Tho Comp!lny
$h!lll 001,pty ~,:h L"'e mtmmvm g~.n chOJ~ requ.arement l rea~ Regulations soc:;tJon 1 704·
2(iX4)
(c) Qutiflfied Income Off~ Tho Comp3tl)' sl'l8'1OOtnOfY 'httn the qust•ned lnooiT'e of'SOC
~1510n$ tn Trco¥ury Rogui:~Uons &eC1Jons 1.704-1(bX2XIiXdX4), (5), Md (6)
(d) llt.'OCaMns Upon Tmnsfor. Upon transfer of \loy rnt~nlbef!lhlp 11\torest tn the Company,
unless egrocd olhor\\\:10 by the trorrsreror and iransferee with tho wrlllon consor1t Ollhu F ~ Attic~ 5
Management
5.0 ~ . Managomem by Managers .
(a) Subjocllo 1h1J f)'OVtS.Ons oC Socllon 5.02, the pQ\YCrs of lhe Company shall bo ex.ortcSod
by or under lhe 3Uthonty ot, and the busmess anc affatrs of tho Company shall b9 mnnogod under
tho dtrocuon or. monagers or tho Comp3t'ly \A4:~C;II8." the Managers collectavely may also bo
referred 10 as the "EJt9CIJ/rvo Commlftoe") inolucing. w'thout J•m•tauon. the followtng
(t) To pay, and to posfonn c: mJnl$ten~l'*c:l$ und dutse¥ rel3hng 10 the general
ma~gemt:nt and operatiOn of the day-\0-day bus•no5s of tho Com!X)ny, irn; ld•ng MlhO\II
lim.taoon tho PIJymcnt of lltnoebted~ 13xes and assessments :
(ii) To collect &11 montes due to tM Con..,any from tho Members or olhcr pen;ons
and 10 disburso Company funds to those per$0ns enlllled to tece.va them
(Iii) To ostobtlsh. m<>lntoln nnd superv1se the depostta end withdrawals orfund' or
thu Company In bank occoonts for the ordlnarJ purpose~ of 1ho Company:
(iv)To ostn~h and set all salaries and componsouon formulas for Members
empiO)'COS and agents of the Company:
(") To at~end to a I star errolofOO matters, .ndud•ng Wllhoutlmltat•on, lhe hlring
and firing or 5talf employeot,
(vi) To employ attorneys to pnride legal c:oun5ol to tho Comp:)ny. tnclud,ng but
notlimtted 10 those logal oxpcn:;e$ '" QOnnee1JOo w lh lotmaiJOn. OC'gantlai!OO. and opcr-..~n
of the: Company and aIllegal expenses in oonnechon ' lh the Compsny's agreement and
arrongomonts dtrectly or tndtroctty related 10 the H06pttal, and to ~mpiO'/ accountant" to
ptcpore 1ncome tax returns. finane~aJ $Wletn!'.J\l! and reports which shall be fumtshod to tho
Members.
(w) To purchase any and all insur.lncc dccmod ooceuary by tho Exocubve
Commrtteo for any ond all Company purposes. tnclud•ng. wlthout l•m1l.ilti0n, guncrotl ab~ ty
tnsuranoe. profe6S10nal ma.practJc:e 11lSvrance, and to pro"ide protectiOn wtth rospoct &o tno
Company and claims of thlfd parbes and to pay the pte~n~um$ from the funds or the
Company;
(vii1) To conduct tho admlntsttatlve aftauo of tho Company. tnclud ng wrthou
llmilatton the laktng of oct1on nccess~ry to C3rry out ony vote, decisions made and oct1on
token by thO Mon.t>ors horeunder;
(lx) Upon tho approval of the Mombc.m! cntltlod l<> vote own1ng seventy five
percent (7S%) or tiiC>fe of the Voting Sharing Ratlos. to sell. osslgri, triln~fcr, convuy,
encumber. plodgo. loa&o, rent. or othetvv.se d•.spose of. and to negotiato with rospoe1
thoro to. the e!sets of tha Company: and
(x} To perform all ol.hcr du~es and obhgaiJOns, and to exerct5e au olhor powors
and (.ghts. pro•licSed ewhere to be perfonned and exere•$0d by tl\6 M.,nager.s
120
'" llddihon ro rne managemen1 of tfl8 Company. the ExecutiVe Comm1t;oo sn. havo ti'I.J
purpoae of oromollng tho cohesion oonvntm ~ sv.;tess, •rnl pto:c:ctron ol lhil fntcro..t£ of 110
G~
(b) In manag1ng the buslnos.s aM affai"S of LI'O Co11'pany :Jnd o:.;ure:sfng ~~ . It
Exueut •m eomm.ucu sh:.ll.tC1 (I) 00116Ciwety ·~h resol\;!1001 aoop!OO at moollllg5 and '"""" Oil
consents pt~rsuantro SoctJons 5 04 ancf 5 oa ilOO( ) m~ commntees one ~.a rv•duaJ lanogers
1o \\ !eh outt.onues ~duties have been d~egab:!d pursuantlo Soct.oo5 OS No r&-agor hilslhu
righL power, or authex ty to act for or on bt:Mf ollhe Cofl'Y.)Illly, to ao S!IY oct thai wou•d te bincmg
O.''l 1M Company, or to tna~r any ax.pernhureon beha f of lno CO'nP'SftY, except in ~rdar~~ lh
lho 1mmod toly prfJoodrng ae11tence ~...40f\S or ad!OnS IS'(on by he Ex.ecot'Yo Corrmrttoo '"
L:COrdance w th this AQroomC01 (lndod.ng thcs ScCIJOI'I 50' Ond Secllon 5.02) sN oonstrlu!ll
doO$tOn•. o.r l"libM iYy the Company and shall bsl:!li'ljollQ Qrl eacn Maoag r Mcmbor Off.cur (11$
defrnod In SociJon 5 001. llfld Cfl'C)Ioycf: of U-e COnt;)My
5.02 M•Jml#'~ RlgM 10 Bmd, DecJ.stoos Reqtl.ftng Memb« Conront No Mt1mbor rn \s
CIJpat~ty as o Mcmborhas the nght power, or autMnt,.ro 3CI ro1 or on IJoll>!lf or lhu Com00t1y 10ao
uny u" la~c My tlcllon tor which
tho consent of tho t;ltJrl'lbbr$ t:nlillud 10 vo~ l9 reqU"fed t>y the Cor lncnto or this Agroomonl "'thnu•
first $UCh oblalnltlg such CQn&onl. Each Member oniiiiCd ~ vote may v.l~tl rospec1 to any 1010
conacrtt or uwrovJI tMllt Is enlltsed to grant pursuant to this ~mvnt !Jf'.tnt or wrlt\!lOid '!IUCh
vote, consent. or ap.Provs in II$ 5olu dr~IIOn
5 03 Sotoction of M.~n~'CJIS TN: n....'Ylbef" or Manager~ or tho Comp;aoy wt
cq~1 ha
numbot of I ound ng Merroet5 who remain Mcml::cr$ or 'h-: COmJ)CJ)y, Of as otherwrw a~d upon
by a VO!O of lhc Mcrnbcr• trUed !D vote holdlng at least se.,cnty.rrvtt percent (75V.) o mu Voltog
Sr ;,rrng Ra~~Cs TtMt taal t&nagc~ ol the Coospeny snal De lhe Managcm; named '" lttu
Cort.freulu, "ho lilhtlll b6 tho • Autltorlzed ft!.a~ k> att for I he Company un• li r Cuc:conotS
3re etccfod tr,· the Mombor; Mt1 gers rrust DS Membe~ or I.M Componv ~ Mannyt:r
( tthtt1hcr n •tl::lt Of a aucccuoc Manager) sha I ecel!> en tied to .-o~e (excfudin~ tho Mornber aoaned ol engag og '"
rou neghgonco ol \\ fu m1 eot"ductl b) SUCh Manager shill ro•lgo us :a M nfJ.'t of tho Exocut1ve ~lao. Rogutar rnoollno~ of IM E;x.c:eutJWJ Corf'IIT11noo
may bo hold on ,uoh duce thereof (spoofrno ltle ploco and tuno or 'uch
m601•ng) tnat Is do tvorod to each oltler r.tal\il9Cf alkk'\.SI 24 hou~ pt!Of to wch mee:ttng Not:her
tho busrl'len lO bu trasm.. ctod or not ltle purpose of such spec>-. I m~ting neod bo ~ir1ud rn the
notJce (or ~~or of notice) ~ttcroor Unl~ othe~W~Se E:Jepressty provided 1n thra ~rucmont AI any
n'IOU!i:ng ol tho Executive Commttlae a ma:QI'i!y (by numb¢r) o1 U1e E.xecu·,~~ Comn hall
121
eon..titUI& a quorum lor the t.nlnsactton of busmess and an act of a tnltfonry (by numbet) of tho
Exocu•...,o Co~Tm~llw Yo~ho are pro:ocnt ~• $uc;h a mee-tulg u! ~hieh a quorum •it pte~nl ~n t: rhtl
act of tno E.xecutl'io Comm ttee. Tne Pf'OVtStons of !htS Secbon 5 0-4 Sha bo II'IBPPI CDblo alany uno
Cf);)l U•··•t> 0(\ty 01\•J a.tntn\gttt,
5 05. Commilee ol ExeculJve Commlt'O..idtld Ill· r olu:Jon ~t:J!Ai5hlt\g •.. gha'l hs-.e and msy oxercse oil o'lhc outooo:y !Nil
may be exor'lt!Jn
lo lhrJm sucll 1•11~. ~ lhu EAucullve Commttlee may deem 3(tytSOblo Any such deloga!IOn m&y be
revo6ctcr. The exeeutl~ Commltteutharr appoint o Ohuctor
.ond en Asslstanl Dlroc1ot , oach of who must also be a Mono~. ond '-mosnull roporl lo tlt1:
Exoc:ul t~ Con\ITllUts~ 4nd , ..no sru!h be responsible lor tne cJay-t()o.ocuti\-o Comm 1 II
O>.troofd~nary Ol(pCrui41 Or OxpotldtiUte$ The E.xeet~tM~ Cotmltttoo Sha'l ha~a Uie nght &0 1'0\'!GW Bf'ld
djU'Sl such bud~t &I ant Wile, from l no 10 time for lhc bencr.t and in!ere t of 1t1e Col• ny
5 .00 Compon$Cifl()(l T"o MOlM{Jei'S, Oiref lha moot.ng. \\hiCI\ shUn'c:; Olhc:Mi c~eprchly pro•.idod in lh•5 Agresrrer.l at any meeting of the Momoers Mombe~
enlitlod to vote hold ng among them at least a truljO(\ty ot aiJ Voting Sharing RJ'IOS (a 'MIJ/Otlly
tnt ruSij. 11:pn~scntoc.t c thcr en pe~ or by ~oy,y ;hi)II oonshtulo • quorum fQ( tho ltDnsac=tion of
~smcu. o.:ld n oct of a Majonty ln:orest shall be t'l9 act or the Membe,..,ll be1ng undetStooo that
MetnbeB, tnclucMg non- oUog M&mbo;:rs may :~tterd all rt~hng1 of lhu r.tembt:llr
!I 08 PmvisfoM AppliCable to AJJ Meebngs In connecton w11h ny m.., tlog ol lht:
E.xoeuL"e Comfn,lfet!, Mc:mbel1, 01 any commttcc of It Exueu~~vo Commlltoo, ltlo loUO"o-.:
~ions. sha" apply.
(a) PlluXt of Mccllf)g Any suc:h mccliog sho I bo ,_4 a\tho PMCIP I ~to of M1nCU of
tho Company, unloss the noiiCS of such mee11ng (or rese>UIJO(I of lhe &ecu e Commtttae or
comm:ltoo, as nppliC3bt ) f.POCI'•C$ o d•flerent pose ol object ng co tno l rans.actlon ol
ww bu~~~ oo tho grouncl lh~11 lhu mce,itl{] 1$ r.otltfwfully Cl..t ~Of oonV(Ifloe)(i.
(c) PnWO$ 1\ Porsoo may vote at such mealfng by o written proxy oxocutod by th.:ll
Person ond de lvorod to anolhor Managor. Membe~. Of rnembor of tho oomnllltoo. a1 opphcoblo A
proxy sholl be ro·..ocable unless 11Is stated to be lrre•IOC8bCe
(d) AcJ/00 by WnJten Consent.lvry 81:tion required or porrniuod to be !.&ICon ol audl a
moeling rn..y bUt pnor nolloe. and wttt»ut o vote I a conson1 or
c:omona In ,•,nllng, 5otting forth the actiOn so ~k9n. JS ~ ~ the t.l;m.;1ge!l0 M mbCr1 or
rnembef's or the COfM'I•IIee. as apPlicable, haw-g not ~e.wr than lhe mlntmum number of Vot•ng
Shaung RatiOs Of vot that would bo ncec:uary to ta~c: ttl& ActJon ot a me+:ung a1 Which
Membera, Managet&. ot members of lhe c:omritae, as appticnblo entrlcd 10 vo on the nctioo
V.'Of'O prdenlllnd voted
(u) A~llngs by T~ne. Manager; Wambers. or mcmbo~ or the comm·t o, as
opphct•blo, m~JY ~r1iCipfllO In tJ.nd llOW such rneet;ng by me30S of cou!t:renoo tufeonofJO,
,. deotonfercnce. O! s mrlar communtcabO.'lS aq~n' by rr..oans of v.hrO, all Pcrs.on.s PG~t~Qpo
In the meollng can heet each othef.
5 09. Oft~ecrs I ho Executwe Commtee may designate one or more ~.tombort&) lo be
offiCOr$ of 11\o Comvnny rOffi'CcrS"), proVIded such OfltCer rerro r~ o f.k!n1bot ~ I he COnlparry and a
professionslind vidual auuch tonn t&derinEld ~~" 3n1 .003(5)of tho TBOC. ond .cevu~oe Cofl"rnrttaa
moy dologolo to I hom Any Officor may bo rcmvvcd ~s such ~ lhnr "''th or w.lhoul cuu~: by 111<1
executive Commmeo.
5 10. LltrlitullomHm Llub.Wly of MciHJYfJIS. n~ ~dbili ly ollho Mo•~\lllj lu ltiU Cor11putty uno
llw Mernbora shall be .mlted \0 the oldent.lf any. se1for1h tn lhe Cer11fk:ato and as provided by tha
TBOC
5 11 Conn•cts of lnto.rosr Subject to the other express pro.. rSroos of lhts A.g·eemenl, ¥&Ch
p, ~bcr p,(J~r. Oll•cor, or "" lo lhoroot may cng~go •n and po~$ lntor·.~ts In other
bu&lnau vonturos o' any and ovory type and o~ptlOn. tndopendontty Of 'Mth othor&, except fOf'
one! In compet.tiOn wtrn the Compenyorones W\COflf"obllg:liJOn tooffer.eo the Company or anyolhefMember, Manager or OffiCer the nghl to po11.1c•pata
lhcHein Too Compgny may ~c,;t b.."$100$$ •.~o~•lh al'f'J Member Man ger, Oft cer. or All~ a:e
the!f!Of. provided the tenns of th05e transac:.Dns a."e no less fo•JOnablo than lhoso thu Col'!' ·;ny
cou1d obiany's taX rowms to bo Indy prtpt f:'ltJCIIOM The Company shaU mald of acoounllng o (d) ro ees of lhe Company,
SuppofV\g documenl;olion uf Ita lro0$$C'b0n.s -NIU\ respect tO thO COOCIUC.: of tNt Company's
business, and IT!rnuiM of tho prooeedtngs of rts f:)cococuUvo CommHtee !Jh~ e~t~bllsh ono or more sepnmte bank and
lnvut~!rnent
accounts and arrangements for (he Company, whoch uhatl bo rMintnlnc Article 8
Windi ng Up :and TermlnaUon
8 01 Ei.'MIS ROQCia'/ng Wllldong Up atK1 TenJ111)9fiO(),
(a) Subject to Secllon 8 01(b}. ltle Co~nyshall wind up 1:& affairs on tho flrstlo «cur of
thu lollo111ng $\/OflU.
(•) the elep"J~ of lh& penod hxed fOf the duraoon ollho Company in the Cort·fato:
(11) the con:.ent of all or the Wefnbers and
(ffi) entry of a d0Cf80 of JUdlctallBmlinatJOn or tho Company uncsec- seccon 11,301 olthe
TBOC.
No othur o~~nl (including, W!thoutllmilatton. any event that tanmno~ tho oonlinued membership ot
the last roma1nlng mombor or tho limited liobihty company) will caui>G the Company to bo wound up
omltom)iMtcd
(b) If an evonl doacribod in subparagraph (il ol Section 8 01(a) shall occur and IMre
shall bo ol loastonu Member tem:llfMg, the Company shall not bo wound up 01 tO*mlnatud, MiJ 1h&
bu!lnass of the Company &hall bo conUnucd, if 3 MeJonty Interest so agroos w1th1n 90 days or tho
occurrence or such event If such eleclJOn 1s made •ottowing the oc~rrollCC! or hall promptly omond the
Ccrtrf&.cot in the m3nner descnbed 1n section 3 0.51 of the TBOC
8.02 Windtng Up ond T«mM & OJ No RO~Ot111i0n 01 0«101 ClJp•raJ l'tcf;O..Jnls. No Member shall be required :o pay 10 the
Company 1o an:~ otner 11 ber orto any ltlird pa1y ar.y dcfiol b8Qnce lhJI muy 41.~taslfrum tln.o to
tune an ~ny c=pltst or sa r account m3tnta."led foe sucn Memner for any purpose
Attic~ 9
Dlaputa Resolution
The p,tambf!f5 hlrvo entered in:O this A~ uti .r
purct\asOf'S and shall a so ~hnVIIOMousty flle duollcate coptes of tho notlco of orbalrallon w th tt~
rugaonat ottlee of the Amoncon Alt>•lroltOn Associ;tliOr1 rAM") fOr H~ston r elf.B!, loge thor wllh U e
oppropnoHo fcc o:. provided In the AAA's admini&aBtiva fee schcdulo 1\ CQnamunlc:Jllora~:> .-w1U1 the
AAA ft!9Brd•ng thJ orbilt' t•oo proeetlP'-'fChasors and lho AAA a rosponso wtltch ~tcs $UCh purch~ny t 10 00 am Hot.r.ltoo Texas 11me on th& seventh vee day
(Saturday. Sunday nd ho6days acclucU3d) after he dale of mo:ling of tha AAA's 1of o~ors
no notce of nlM ns. AI such lime !he ~rchssera shall e.ach. 1n accordance Y~ th 1t1e ran~-:.og
f'~
...,hlch Gt:JIU5 suc;tt \1ppt1l~S wew rcg3rcitt'9 the 0!3pute and the dell:lred rell'Udy or rusotulion As
soon as pract•ca a1tor tho e~Cptra~on o• tho 204ay period bog:nnlng 1pan lhO do·~ ol rtl11•lir'SI or lhe
not.ieU nf ut>ttrotiOn, the AAA !'.I II comp e a lslclt.h.ree a~blo tndrviduals or of\l.llius c.ompotont
and QU3 tod to be a common a~ a. di:$C(:be:~I IUbmllllltl ht lhu AM Th '
higt1e11 ronklng hldovlduat 01 en tty whose name remams oolhe Usl upon complotlon of such t~llikJilg
&hull bo lho comrnor' oppr ti!:Ur lff.h() conl(J'lofl appralser !!o eclect~:d tleclln13' or tor any r~uson
fal111o sorve, thts procoduro slmll be repcn~lvo unUian mdloouul ur em lily IY4tu Is wlllh 'll vrl
:1~~0 n' A common nppral~~t:r hoi oeen saatted tr sny appra•sor a1 any point fa• Is to partlclpoto "'
the procoduru 11Qr ""· thu lollo·.-.mg procedure $.,., I epply:
(a) Tho M&mber seeking to iOIUSte tte Prooeduru (lhe •twti31111Q MembW') Ntll g1v1!
written notioo to lho othor t,(cmbcrs. oescribing n gcncml tcfm:; the notuto o{ tr.e DISpUte. tho
lnrt:at~ng 1'1 mbef"a dalm Of relle! and ldent.:f)-ng O'le or more Individuals Wt!h eutllont1 1o 1Mtl'Je ltte
O•~o oo u~h M •mbc(:; boN The Merrbef(s) rc:coiv.ng uch nolicu (11\0 "'Ro$1)0(1diflg
Mombef:) whether one or mora) 1hd ~ave frve (5) business days w•lhin wtUch to t1e1lgnate. by
wnlten nooce to the tru ling Member, ~or more tnd•· 'dualswtthau~ ty ~ Ulf: O.spu!eon
wen Mombor't bohalf lh4t •no!VIdua:s so ~ted snan bo tr.nQ\\"!"1 a \ho "Autttonzfld
lndNIOuil • Tho Rospond~ Member may sut'lORZe hlmseU as an AuthoriZed tndMdual Tne
lmU lmg Mumbur ond tho RO:$porxN'9 Morrbel tMII ~iy ~ tcl&rr~d uw U\1~ •Of.VJufiii!J
Mef'fll)MS" or indMdualy ·o~pullr'lfl Mombw •
(b) Tho Authoriud tnchvidu9 s ShaHbecntitlod lo ma«o wch ~ lr!J:liJOo ortncOispUtc
as lheydeom appropnate bUI&Q1'98 to promptly. :md tn no event lef' than 30 days from tho dote ol
tho ln-tJnl!t'g Mumbor'•• wrillan nouce meet 10 discuss resolution or the; 0 · putu Tho iwthoule' convenient tlmt: and p~aee tor me modl~atlon ond
unless ctrcurnstanoes rtiQU•l'G otherwise. such bme to oe not =\tor thnn 45 doys aflor
scin, \\'llh thO hutp or the medtar.or tl req..ured.
(·1) At least ""oo (7) days poor to the first 5mediatiOn, each l>spuiing 'Aember snail deliver to the medl8tor and to tho other
O~pu'tng Mombun• • ~u wrilr.en W~'rmory olcb v•&.vt Of) thu manur m O•spvlo
ond such oUlor malton> roquwoo b)' the mefl'•tted by each Oisput.ng Mefl\bef 10 him
I~) In the medcatloO. each Ozspo..1Ulg Merr.cet may be tefX'Hf'.t'lted bV en
AUU!Oflt6d JndNid\J41 lid tnay be ~esented by CCXin In add I caseh
OisiJ'It•ng Mombor may, \\ lh penniSSJC"l or the med•ator. Dnng such &MliOnal
person IS netdud to respond toquesbors.c::orunbute 'Oml3110n,llnd p.;1r. fn
the negoliuhon$
(6) The tnedlntOf s.t\a'.l detemlf)t: the rormat tOt Cht: mectir. , cJ nctf to
osi4M1t thet both the med~alot and the A.utllorized lnoNrdualS ha'le on ~unity to
hour n onat pr«J:.t~nt.allon of uach D•sputtng 'Aerrbet's w.:. on lhu nt.~tlt tllllllput~
ond thot lho au!honzod partieS attemp: to nogotiato o 1'0$0luuon of tho mottor 10
dlsputa, with orwttooutthe assistance or counselor otners bot '"'h tho an.s~nce
ol the me'occdU:e 10 Its COfteW tOn. fhe med.atr.>n shsU be temunated (1) by the eli.OeutiOn
of a so:lloment agreen-oot by tho 0Gpu2ng Mombcfs (ii) by ; duci&IDt oo of
moo tOt that the medta:.on s &ennanst!!d or (~1) oy a 'hn!ten dedarouon of •
015PUiing Member to lho ofl'Od lh3t the ~::~~:on~ ~tud t tho
c:ooc:lusb'l of ooe full oay's medialion session. Evon if tne medta 10n aa !Qfmlna\Gd
wrtl\0\lllJ rusoiUI.Ol'\ of the O•sput.e , !he Dsou:.ng Members agree OOl to lemltn8':8
negoti ptlvj;tgod Such conduct st. l~cn\$, prc:m1Se.:. olf~rs. 'VICW$
nd Oj)G\()M Sfl¥A not
bo d•SOO\'cra or admtr.stC!o f()( any pmposo, in:I!Jdtng lmPQDcnmi'Jnt, tn any
lUlgalloo or other ptooeocllng in11olvtng tne pgr11es, eno wll 001 be d•~osod o
anyone ocx kwfs
Any pacy rr. y sutlfn.& the Q.eputa lo aroi:ra1Jon and shall dO &o by gi l'lng wntten notoco of
&rtltlt uon to tM other pa.: I•Ol> co me o.~pute sod sh311 alSo Slfllultan~:ously Me duph 1e c~ ol
th"J r'()tioo of Ott•lmliOn wrth tho reg10oal offllrttlucJ tmu lito rumecJy or re$0h,llion ~ouyhl by lhtt porty lni~Ung erburtJh<>n. tiJch
of lho 0\:sputlng Mombers ~holl. wllhln 20 days from the doll) nt mulfino nr t~ml11ollr~ elf m'b.lrnhnq
l•"t- wllh tho pai!IC!J and 1M f\AA a respons.e which 9tales !!IJCh patty's re'Viaw rogordlllQ Ulal 0.11puto
to bo nrblltolr:ld aod lho d~lrod rc:mudy or ruso1u11on IV. !I()On liC Pft't.'llctlbiO oiCw lhit' u.11plnt\tOtl or
1M 20 dsy ponod beginning upon the date of mailing cr tnill notico of orbllrotion tho AM~~~
c:omp41'0 o '"' ~ _.vu•l.•b'u .tft>llr3tors ecual to the 1\U'llbdt or Olsput.fl9 Mem~ olus one:
oompo1ont and quallf10d 10 be on afb,trntor a$ doscoood n thO rtoiiM or rbtlmhon ond thO
rcspon~!« thureiO The AM~~ also. at the ss.-ne tune. ram the arbltntlora 1n on)er fnt tnrovgn
tnal ~bor OQU-ll to th numbot of part~es subfee1to Qlt, Oispul& plul one end UlehHJ;x>o
fOrtti'N•th lransmll the l:st SlmultaO:WOU&Iy lO the partieS and •nform ~ITI Of lho Older tn \\tli(;hlhe)•
havo boen ron~od Unl4ss tho p r1ieS ~ha: befO"ehsnd d!J'~ toad I orcnt kne or place , or both
lhilf rrmct at lho pnnapal offa of the CoolJ;any at 10 00 a rn , HC«n1on. T4W)$ tim.:. 01'1 \ho
'..ovo.tllh wtckdfey (Sti!.A'da}l. Suod..ty and holds~ exctuded) af!Br tho dalo or mathng of tho AM c.
l•st or arb•tmtora ond no~ of mnkmg At $ueh lime, each p~uty 10 L e Otspwu 'ns I each •n
:tecotdance 'llftth tne renl\tng de~ennined by the AAA stnke ono ( 1) tlilmo lrom ln& I &t !iut>m.IIC4 by
lho AAA Tho highest mnkmg ndN•dual Q( enlltywr~se M'lle tems on lhe IISIIJPOO complo~n
oC &UCl1 str"Ung shall bo the ol'bdtalOt for tho parties. If tNt arb•~ lOt o ;clcclcd dechn 01 IOf ~my
rco:;on I Article 10
Non-CompetitJoo; Non-Soltclbtfon
10 01 . Covonunt Ncl fo Compclt: Each Member recognt10$ IMI (IJ ll'ct olh ' t.lumbtit~'
eoter1ng Wllo rh1s Agreemontla Induced pnmarily because of the covenant& ano assurances m Member competes With the Company" Ulln l"'e e.r~a
or roas spoofed in tnis Art·clo 10 Thc::rctorc ~con::,dur"'tiOn of 1 t: preft!1ses, lhe pli)YI•Cnt by
lho Company for any compenYIJon or d•stribubcn In aocon:fanco Wilh Lh's Agreement. end 85 an
loducamcnt for lho other Mombcts lo entc:t .-to ctus Agteement and oon!Wnmate the 1tansacuons
contefl'.C) :00 herein, each Member horoby aiJrees lhat ' &uch Mombor 1$ ;a ,.., mbor ol Ul\:
Con pany ~nd lor oa p••OCS of 1111uu (3) re3/s foll~tng the cute thai a Member ceases 10 boa
Member (for any reason 'Nhatsoevor o~ ttg, w1hout ~uso) (thO ·Ru!lrlc1111U Pc.wod') such
Mumbor" tlt~l. duccUy or tnd ,ecuy. •n any capacity, OWTl. manage, operato contro . parttt•poto In
tho monogemont or oonli'O' ot bo omplo~-cd f1'/. eon~ull w lh leod euc.h Memllet's name ro reCtli\IO
''"Y rertNnerallon trom, or matnlaln or continue ahy mlerost wllotsocalod Within a ( ) rn-1<1 ruOI\J$ o1 lh., I l~fJil~ (11m
·Roslnclocf Atvu·). prcwldod, how'evor ths t nollwlg contaood tn this Attlr:Jo tO shall prohibll sv.nQ r~s~j()t'l wtU P{evt:nt sUdl
Member rrom hoving no ofi!W .n tho Res1tlcted Area ounng the RutnctJVo Punod Olhet lholn '"
OI!ICd prowidea by tne Company,
10 02 MOOIC- • St. lu Bo:!rd or Madiy thO corn pony tor any compensation or dtstrHJulion rn acooroan~Je wHh \l1r!l
Agroemel't, and as 011 lnducomonl for tho olhor MtJmt>om' 10 e01et mto this Agreemonl and
COII ..UtT'IllOtt: the tronsact1oos comempl9ted hsrein. aactl Mombcr l l!)roos thul ror duliug tho
qe51tf00'\iensntsdesc:nbed .n thisAr11Cie 10 are ancutarytoanotne~W~se enfon:eat>le egreement.lt\31 the
duru110n ~pu ncJ lJo)()gri~phre atu oppl:!eable to the (X)V1)f\Onl dcscribod rn th• Artclc 10oru '""•
ruasonable. ond noco&sary. that odoquato compensatiOn Is to be reer agf88s ~~ ttns Artie:fQ 10 tisfi8S the
r~qu:rte.'liCIIb ot ueh st. tut& II, howe11er, lor "ltty r~son any coun ot compel 1 iSd!CUOC'I
de:«mtnes lhot tho roa~tiOn$•n th1i Article 10 are not roasoNtblo. th t tho COOSJCtcrolion IS
lono~uatc.lhal auch M&rnDbr ttas been preven~ from eaming a livelihood or tl'\:11 t1 Mid'e 10
does not m~l h~ •oqu men I• ofToAAs 8U$incu and CommetCU Codu § 15 50 •uc!l rl)ltne1ron
shall be Interpreted, mocur.oo. or tewnttE!fllio rdude as muc'l of ltle durab.otl, seooe, ond geograchrc
mea idonhf•~ 111 this Arlldc 10 as._..,, ltl'ltler such r~lr¢ll0ns '411d uf'd c:r forcel'lblu
10 0'5 Buy Out Commenc10g upoo tne date that a MemberCilases to ou e tlcmbor(tor .3")1
roo son wnal6oa..'Or) nnd unlrllho end or tho RcstrI)I tilld
adoqoatuty bu com~n~ted by money damsgeg as such breaCh""" causo tho Com'*'Y to 5uffcr
rreparable harm. Aceord1ngfy, upon such Member'$ ftsilurc 10 ooml)ly .-,ur, till: k1tr1s n4 oo'W:SIIJons
or IN$ Artldo 10 et eny toma the Company or any o~ i:S succos5CHS Ot ou.gna ' :ttl be untlllud to
njuncwe or otnor e treon:ftnory t ·hot, $uc:h ~e 01 otl"..er extreon:Lmuy re t ~ bO a,mUiatrvo
lo, bul not n llm•taiiOn oi. any olhef romefftes lh' mat~ a'fi1 :aolct, If~ Nithoull m:!3Ucm,
e)(pul$100 il$ * Mcmt • ol lhct eotnpe~ ptJ~..am to Secoon 2.15 of this Agfecmont Eadl
Membefs ~·OM 50llor1h '" Vl.s Andc 10 Sl'l t ~ ..'U Chf: •-rrn.natloo ot St.~ terr.ber's
tfl0tnbet$h•P 11 I!JI' t itl l1'e Cotr>pany lf01 any reason v.hatsoever).
At1ide 11
General Provls&onr.
11.0 • Off. 01 Whene•teflllO Company IS to pa)canvsum loilny ~.~bitt, •nywnuur ~ Umt
t.lr.mbur 11 03 EntlfO A{P'8emont Supersedure This Agreement coosll:Ulos tho entlll agreement o4
the Mombers r~:l ~ng to tho Company and SL~ all pnor oonlttets 01 rcon- na w h respect
to tho Company, Ythother oral or wnlien.
11 04 Effecl of VlaNel or Consent A Wilr\'el or c:on:sent, uprus Of plied, to or or any
btoach Of dofau I by 80)' Pet$00 In tfle perfonnance by :hat Person of 1ts obligat.oos with respect to
lhe CompMy i 00( a eot'ISI:fll o· w#Net to or of ~ottle-- bt~ch or dolaullut the: PtrforlmJtlCO by
that Penon of the Amo Of any olhor obligalions of that Parson wtltt respect 10 tho Company
\ l 05 Amendments of c.rtrr~C IN WITNESS WHEREOF, the Members have executed this Agreement aa of the date first
set forth above.
MEMBERS:
George M. Davis, M.D.
24
135
EXHIBIT A
lnltJal Members {Foundi ng Members)
Alan E . Bentz, M .D.
Address : P 0 Box 111
Houston Texas 77056
lntt•al Capital Contnbutlon. propeny having a value not less than $200.00
Sharing RatiO 200%
VoUng Shanng Rat•o. 20.0%
Woodro w V. Do llno, M.D.
Address: 16407 Augusta Court
Spnng. Texas 77379
Initial Capllol Con tribution: property having a value not less thon $200.00
Shwlng Ratio; 20.0%
Voting Shoring Ratio: 20.0%
lavo n Vartanian, M .D.
Address: 9403 Swansea Bay Drive
Spnng , Texas 77379
IM1al Cap1tal Conlnbution: property havrng a value not less than $200.00
Shanng Rai•O 20.0%
Votmg Shanng RatiO: 20.0%
Roba T. Antenah , M.D.
Address· 223 Westhe1mer Road
Houston Texas 77006
ln1t1al Cap1tal Contnbution. property having a value not less than $200.00
Shanng Rollo 20.0%
Voting Sha11ng Raho: 20.0%
Goorgo M . Davia, M.D.
Address. 27 Pebble Cove Drive
The W oodlands, Texas 77381
lnltlol Capital Contribution: property having a value not less than $200.00
Shoring Roll o' 20.0%
Voting Shonng Rallo: 20.0%
136
APPENDIX 2
American Arbitration Association
Alan lkotz, M.D. ll George M. Davi:s, M.D., ~w V. Oolino. M.D., Anreaeb T, Rob11, M.O.•
U\"<>tt Var111ltinn, M.D., Houston Northwest Emc~ency Specialis~ P.L.L.C.. Northwest HOU$tntl
Ecm:tg-c:CIC)· Speciali:sts Group, P.L.L.C., ESO MD, P.L.L.C., llt'ld ESO MLP. l.L.C.
Caae ~ 70 193 Y 000688 12
Purswnl to the Commercinl Arbitration Rules of the Amcricsn Arbitration A9Socr.atloo (AAA)
and the ~rms of con.trocts between the parties. an evidentiary h~aring wu held at the o~ Q(
l"ulbtigtn and JawOI$li:i, L.L.P., 130! McKinney, S'uitb SJOO, tloushm Texas 011 At4gust 19·22 Wld
Augltst 29, 2014. before Arbitrator Robert E. Wood. Appoaring at the hearing wt:re Andll!W Pri~
and Rachel Roostb for Claimant; Adrun Looney fOt Respondents HNESO, NHES. ESG MD, IUid
F.SG MLP; and Mtlttbew Mu~l\lli .t11d Shtmnon Rrown for tbc: Individual ~spondcrus TI1c
part1es had a full opportunity to ~~~ evidon.oc by te.~t imony .s~td dQCument$. cer111in
.stip\lllltions were entered by tbc piU'tjes, aod counsel for each party ably ru:gucd thei r pos,1tions.
Po.tr~hCIU'Ing submissi(lns were rocciWld .Oft September 19. 2ill4lllnd Scptctnbor 29, 201<11md the
J1earin~ was. a11irat time declared ctt1b'i>'C81 Hous.tOf.l Emergency Sptcilldblll Qroup. P.L.L.C. ("NIIES<3''), ESC MD,
P.L.LC. (''ESG MD''). and ESG Ml.P, L.L.C. ("RSO MLP") (O()!Iootivdy ..the! Ent'ily
RC$p0nclenlll"). AD wen! owned in equal share~ by the indiv1du•l~ ddailcd b¢1ow exoept HNES
"'bich was wh!ol)y owned~>' NHESG. TI\e terms of the Company Agrccrnents or NH:ESO. SSO
MD UYJ ESG MLP ate identical ellc~:Jpt for thC~ names ·o f the entities. The a ) tit* wet(! opuatod
in c:oocen. "'tire t:ntTISI)IIrenlll$ r.o tMes • oll income flow i11g to ctlc individual owll.Cf); - 11nd \\'CJ'C
n:fem:d to .as the '"Groop.'"
1'be lndM dusl.s lvvolvcd include Alan Bmlit. M.D. t'Claimant''), George M. D:svis. M.D.,
\\\»!row V. Oolino, MD,. Anlcoelt T. Ro~ M.D., anJ Levon VMI.Ilnian. M.D. (eech a
Rer;pondmt lllXI c.ollocm« of the relevant co1upauy .'\grcamoots. the Cunnn~r-cul Arbilrntion Ruler. of the
American Arbitration Association and tho law of the StAte cfTeX'D$, I n;m nuthori~ to decide the
arbitnibility of tmd to t8$0l\r'e any di,;tntte nll4tillg to tl'\c ~ree:ments.
1488
Limi(C(J liabilit)' companies. lncJuciing profess.io!W timited ll:tbil~ CC)q)pW~ ~ cumusl)'
hybrid buxi~ cntldcs.. Tbay m csscnli&lly inoorpo,_.cd p:utner$hjps. Jilt stlltutc:.y sdlmc
provides c:i)l'pOriltc slw'eboldur-like timit.ulons on tile: Uallil~ o( the: ()\•men (Mcmbc~) and
pc:nflits t~~ion an.d govem.1~"e with flaibility similar to a po.nnenllip, inchrding the rlg.ht to
lksign such i'OV~e :md 0~~1 b) ~mCflll ~'ell \\bCTC il COdlttadlt~ th.c: WlfiJ\Or)'
~ne (will! some oon-WDivlll*! srat'ltto.ry ~iQn$). Moreover rht tC:dcNtl lnllOcn~ cu allows
these enti1ies to reoeh~ portncrsbip tax treatmen\ i.e. no mx 11 the entity ltvcl.
The Tc:xas Du3i~sa ~intion Code provides trr.; o mcmbtr ()( 3 lirnim:l
llabili!Y oomprul)'
may not bo expelled. TBOC §101.101. T'be relt!lf1Ul.l COI'llp:s.n)' Agr~ntenls C>f the f.nrity
Respcndcof.1 ( ••AgtftmcotS"'). &$ they 1'WC reMitted tc> dD. ocm.Uy fK.'111llltcd cxpolsioo of a
Member. Claim:mt nod :tll lle'ipoodentS.. both crtlity aod iodividu:al we:rc bound by 11\e
Agm:sm:n4i wim re~ to tho m:Jnner m wni..-11 !hey dealt w i1h cxpultlc>tl. On Scopt.cmber 19.
2011, tbe IJ:ldividual kesponoclen~s. acting ~ 11-..e 1::¥-ccnt.i~e Committee cxe'itffitlmisl:onduct'" all >pe¢itied in
Sectian l.l S of dle A~atts, Clairufln( ~ dtaLI!Ie only c:.i~ iflcidcnb dtd 11ot rise tu lbe
~'CI.I of '"pofll ~qhg.enco or '>'i llM cnistOoduc:t." Rcspondi!OU d~ 30d w:;, llrguod that
Ill!.! A~mcnl.$ gave the E:tcclltr.•e ComCJl itt~ absotfuto disami.on1o dccld11. D~itc tltc ~al
01\mi')' ur.d 111\SitCfllty I:O!Ic!uct of SOICC or tht duet~)('$, I do not rmd 1M die 'ndividlal
R~s filii~ to follow the Ag,tm~en4' provisioc for c=ox:pttlsion
FollowiJ'Ig the expulsion. R~pondcrn$ N'HESO. ESG MD 41ld BSG MLP ex_cn:®d tltei:r
~.SptJCth'e options co purchssc Dt. 6elm's Mctn'bi!NfUp ln1 c~ as provided in So;tion 2.0S of the
rc3peetive ~Mctltli... »o-.....va:r, w dlh d&t'« fi'OO\
mrnsG. £SG MLP end ESG MO lhe !SUITI of $j26,7% plru prc:jud~etK iu~rt at tho Sl.al\1101)'
me of {i\'~ JICR:Iellt (S%), in the omount <>fS5268.
1489
lhTexas limited linbilil)' QJrttpall)' c~ tC)4L!CU", in rucumpl!JY)' ~cot.ll'lc!t.all:ltlll)' rule
chst 01 Member may noc be ~pclled, it must m~~ "ery olenr nil of lbo cotlSeq'IIC n~~ me; iflllldon.
ln OOO'Sll\lin& 1Uah an agJC.., ncnt no rigbrs or eon~uco::es 1hat an: not spceHi~ly providl'Jl upon W~pdl$10fl. ()r LMII~e s'Jlllll, from tllbl
PQitt£. cease to ~ ~ M~bcr ~ bi~: Shorill~ RAtio be reduced to ~Jt~ro. I~ Sccuoo 2-0S oftlu:
A{!ntmen~ demon5m~tl:'~ dw ~ toxpdlod Menlbct m.airu hill Mcm~')l\ip lmert:St. ·n,t
Compl\0) aAd tbe other M¢1llhmi ho~-e on opdOCI t<> fl'..Jfdlll.fC 811
1 or tho Ml!mbcrsbJ;l lnl~~
own4.'d by tile expelled Mcmb«. What happen.~ if til~ dtdine Ill C?((KlSlt! that q~rion? 1bc
e: ~xp•ddon Tl~e
optlou JlrWi~ the Comp;uty .nd tbc ollu:r '-1C111~ a mec;h!Ulil:ln for a:qu.irins the ~'"JlCUcd
Mcmbef's Manbcrtbip fll(erest. Jtdle Mcm~ip 1~ :and its ti~t to ~i•~ clistribldion af
profits .rimpt)' wcm away ltJKltl expulsSon w~· "'f a Memher'$liip lnte1C$T ~1311 be effective
until AIJ provasions of tbc ~l.f bllvc bcm Sall~f.ed a.ncl that a f\kmbtrship httCR."' '"oko:tcd
to be purolussed.. . shaiJ bo paid for 8A a closing L:tee()cQpo.oiod] b) instlllm~nrs ofcWlve)'Z"nct: nnd
~"nrocnt. '' lioth of tbcsc {!ClWisions: -wty to !be ditpo~itioll boy n~ing the ri,sht 10 porch~
11n ~eUecJ :\icmber's ~mbcm:tlip l11tCifC:31
CM\mon ~~. lor,io and a ca~ful reediJls of t!K ~mts cOfllpcl that. un.tiJ paid fof' his
Interest, AMember. c~ on expc;:llcd Mamber, it c:flf\llclj to his 11hm: Of1111Y di:ltributions nt3dc by
thll Comp(U))'. lJea.u;ue or or
the d!iVCiute iJnd lh¢ tax Cl'tWmenr tbt CMefiei~ oi ltte faiii.R to providc-
disa'lbvuoll8 10 tlterr ~How (atthough c:xp¢lltd') Mcmbc:r, Or. B~1L 1ltt-reJcirc, wtw.thao b)· sdt;
imcrcsted autmgemenr. « co pteveot the urijuSI n•fit:bment of n.aney ~ ar.d
~:om'«::iDn,
~O!t\-ed, C laimM\ 1ball tun-e And n:CO\oer fmm ei!Ch lndivtdl&1.1 Respondem the :sum of
S22.8,44S.S0 plu:~ pre-jud~~t in~ in the Olt'IOWII of ~1),764.~ (\lf II 1D1nl of $2.49.210.
Ihes\la~lUd:s nrc ooljoim Md lle\'C1a.i. bur a~ indwidulll
The ~ndc~rwdn~ .tnd 11arivirics of R~d~ io «q~ellirrg Clailllnm did M l c011Sriru1e a b~a..:ll
of tbc A~eJtts. Ho~'C\'tlr, a.~ b.o was u""~ paid for his Mecnbcrttlip lotcrcn, Ciliroant
rmuincd a Member <>f NHESG, ESO MD acd £SG MLP \mcil Lhl· tntry of this AWARD, by
wbkh hit Membctship Interest is ccmun3led and extin«ui.1hed.
1490
Section ·9.03 provides that the perly wbo pre-vaiJs or !iubJb)ntially ptevllil~ in o proceeding under
Aruclo 9 ~shalt be ~:ntctlcd to recover... all cosn, cxpenS(IS aod reasonnhlc .anomey ftles incurred
in .. the proce!ldiog.," AoCQrdit~& ta the plet~dJng:~ this matter involves on~ claimant. eight
respondcmu And 16 counts, coostltuti.ng 6? $Cl)IU'ate clr~im~. In addidoo h involved and includes
anotlu~r in~xtricably intetTclated Article 9 proceeding under Section 9.01 of the Agrecmetlts ro
determine tbe fair marlcec v•hle ofClaim!llll's Membefship Tnterest. .Respondents ~vailed in the
St®oJ\ 9.01 pmeeedin g. Moreover, HNBS prevailed on Hll claims J~gnm~ it and is entitled to
rocover irs costs, expenses a11d reasonable attorney lees. While severol claims were not pursued
lllld seve~! denied, it is fair to say 1hat Clnimant s11bsto,.tially pre'Vailcd in his el&ims Md i$
entitled to reoover his costs, expcn!!Cs and reasonable attorney fees.
Since eooh party is a prevailing party, J ltereby rule a11d AWARD th:a1all fees and expc:n5cs paid
or payable to MA for this llfbitnrtion be borne by tlte party paytng or having paid thtm,
I bcrrcby AWARD that Claimam have IUld recover the su•n of $614,488.18 as ~ovcry for co~u.
cx.ponses and ~llSOtlable attomey fees. This portion of the award is ~ainst NHESG, 'SSG MD,
.6SG MLP. Goorge M. Davis, Woodrow v. Oolino, Antcneh T. Roba and Levon Vru1Mian, jointt}'
nnd scver.tlly.
Respondent HNBS is ~ t prevailing PllllY· I hereby AWARD that tiNES bav~ aod recover
from Cfa itnant. the amount of $50,SZ4.91 for its. co~s. e.l(pl.'1!3es. and reasoaable anomoy fees. If
llll parties~. in writf~ this sum can be credited against the attorney feefc061 award in favor
of Claimant.
J have oonsidered cnch and ~l:rY count. cau:;e of action, olaim, tJ1eory, measure of damages and
prayer hrougtlt by e4ch POJ'IY. I have entertained testimolly, exmnincd exhibits, stirmlatlom,
dep;o$ition exeerpu; and post-heruing submissions. I have read carefully lflld construed tbe
relevant 11gn:ements- I have utilized and lll'Plied Texas law as I understand It A$ o result. any
~lief not expressly granted in the following AWARD is denied,
(Remfti.oder or this: pa~e intCI'ItionoJiy left blnnk
FINAL AWARD lollows)
1491
Ji'JNJ.\LAWARD
I, tbe undersigned ARBITAATOR, haviog been designated in accordance with the Arbitration
Ayecment entered into by the above-named Parties,. and having !>eon duly sworn and havU'Ig read
tbe pleadinjp, heard the te~timony, tcVicwed the relevQnt docwt1enr.s. listened to argument of
oouosel. read and consjdered the hriefs and the post-hearing &ubnussio.ns. after full considenttion
of 'lllc record upon due deliberation, consttuing lhe contraCts a.nd applying Texas luw. do hereby
ORDERaodAWARD that
Claimant shall have and l"e()ovcr from Respond•mt5 aa follows:
1. From NHESO. ESG MI.P and ESG MD joirttly and sevcllllly in the amount of
$532.064.
2. f rom George M. Davis in the amount of $2.49,2 I0.
3 From Woodrow V. Dolino in the amount of $249, 210.
4. From Antcmch T. RobB .in the amouot of $249,210.
S. From Lcvon Var!llnian in the amount of $249,210.
Additionally a11d separate from tbe 11bove, Claimant shall have and recover
6. From NHESG. ESG MLP and fiSG MD. George M. D11.vis, Woodrow V. Dol !no, Antench T.
Roba and Levon Vartanian, jojntJy and ~verally the amAPPENDIX 3
.
,.. ·' 10/28/2014 10:48:58 AM
Chris Daniel • District Cleric
Harris County
Envelope .No: 2976481
By: CHAMBERS, WANDA R
CAUSE NO. 2012-44569
ALAN BENTZ, M.D., § IN THE DISTRJCT COURT OF
Applicant, §
§
v, § .HARRJS COUNTY, TEXAS
§
GEORGE DAVIS, M.D., ce al., §
Rc;pondents. § I 90th JUDICIAL DISTRICT
FINAL J UDGMENT
1>.z.~ . .,
On N!}vunl:ler .J., 2014, the Court heard Applicont Alan Bentz, M.D.'s ("Dr. Bentz'')
Application to Confinn an Arbitration Award (the "Application"). The Respondents to said
Application are George M. Davis, M.D. ("Dr. Davis"), Woodrow V. Dolino, M.D.
("Dr. Dolino"), Anteneh T Roba, M.D. (UDr. Roba"), Levon Vart ,
•
• From Dr. Roba in the amount of$249,210
• From Dr. Vartanian in the amount ·of$249,210
IT IS ADDITIONALLY AND SEPARATELY ORDERED that Dr. Bentz shall have and
recover from NHESG, ESG MLP, ESG MD, Dr. Davis, Dr. Dolino, Dr. Roba; and Dr.
Vartanian, jointly and severally, the sum of $6 I 4,488. I 8.
IT IS ADDITIONALLY ORDERED that HNES shall have and recover from Dr. Bentz
the sum of$50,824.91.
Execution shall issue for this Judgment. .Dr. Bentz is allowed those writs and processes
as may be necessary in the enforcement and collection of this Judgment. Additionally, this
Judgment disposes of all claims by all parties, atnd it is a final and appealable judgment. Any
claim or prayer for relief not expressly granted is lhereby denied.
Signed this :!..._ day of De. c-
- 2-
1795
APPENDIX 4
10/28/2014 10:48:58 AM
Chris Daniel - District Clerk
Harris County
Envelope No: 2976481
By: CHAMBERS, WANDA R
CAUSE NO. :20 12-44569
ALAN BENTZ, M.D., § fN THE DISTRICT COURT OF
Applicant, §
§
v. § HARRIS COUNTY, TEXAS
§
GEORGE DAVIS, M.D., et al., §
Respondents. § I90th JUDlClAL DISTRICT
ORDER CON.FlRMlNG AN ARBITRATION AWARD
On ~(/
~mbeT _L 2014, the Court heard Applicant Alan Bent2, M.D.'s ("Dr. Bentz")
Application to Confirm an Arbitration Award (the "Application"). Af\er considering the
Application. all additional briefing filed by the Parties, the Court's fi le, and the Pl!lrties'
arguments, the Court hns determined lhrlt Dr. Bentz's Application should be and is hereby
GRANTED IN ITS ENTI RETY.
IT IS THEREFORE ORDERED that the Award dated October 15, 2014, which is
attached hereto and which was issued by Arbitrator Roben E, Wood in the arb1trat1on proceeding
between Dr. Bentz and Respondents George M. Davis, M.D., Woodrow V. Dolino, M.D.,
Anteneh T. Roba, M.D., Levon Vartanian, M..CI., Houston Northwest Emergency Speci~tlists,
PLLC, Northwest Houston Emergency Speciali:>ts Group, P L.L.C.. ESG MD, P.L.LC., and
ESG MLP. L..L.C., American ArbitTation Association Case No. 70-193-Y-000608-12
(the ''Award"), is hereby CONFfRMED.
IT IS FURTHER ORDERED thu.t a ftnnl judj,>ment sball be sig11ed and entered 10
conformity with the Award.
SigJled rh1s !1_ day of ~ ,20 14. () -
14:£/L
Tl EHONORA
RECORDER' S MEMORANDUM
This Instrument Is of poo~ quality
at the time of imaging
1796
APPENDIX 5
12J1/20i4 10 45 38 AM
Chns Daniel • D1str1ot Clerk Hams County
Envelope No 3324789
By CAROL WiLLIAMS
F•led 1211/2014 10 45 38 AM
CAUSE NO. 2:012-44569
ALAN BENTZ, M.D .. § IN THE DISTRICT COURT OF
Appticant, §
§
v. § HARRiS COUNTY, TEXAS
§
GEORGE DAVIS, M.D., et at,
§
Respondents. I 90th JUDlClAL DISTRICT
§
ORDER DENYlNG APl>LlCA TION FOR PARTIAL VACATUR OR MODIFICATION
OF ARBITRA Til ON AWARD
On this _l day of bet:_... , 2014, the Court heard the Entity Respondents'
1
Application for Partial Vacatur or Modification of Arbitration Award (the " Application"). After
considering the Entity Respondents' Appli.cation, all additional briefing filed by the parties, the
Court's file, and the parties' arguments, the Court has determined that the Entities' Application
should be and hereby is DENIED.
Signed this q day of kc__
'
'
1The "Entity Respondents" refers to Northwest Houston Emergency Spec111ilsts, P L L C., Houston Northwest
Emergency Spec1ahsts Group, PLLC, ESG MD. P.L.L.C .• and ESG MLP·, L.L.C, collectively.
ft£CORDER'S MEMORANDUM
lhl&Instrument is of poor quality
at the time of Imaging
1797
APPENDIX 6
1211/:?014104538AM
Chns Oan1el • 01stne1 Clerk Hams County
e nvelope No. 3324 789
By CAROL WILLIAMS
F1led 1211/2014 10 45 36 AM
ALAN BENTZ, M.D.,
CAUSE NO. 2:012-44569
§ IN THE DISTRICT COURT OF
p\
Applicant, §
§ ~pjuy
v. § HARRIS COUNTY, TEXAS
GEORGE DAVIS. M .D.; et al.,
§
§
rnodiy
Respondents. § 190tb JUDICIAL DISTRICT
ORDER DENYlNG INDIVIDUALLY NAMED RESPONDENTS' MOTION TO
PARTIALLY VACATE OR VACATE ARBITRATION AWARDORINTHE
ALTERNATIVE. MOTION TO MODIFY AWARD
On this J- day of l).e.k , 20 L4, the Court heard the [ndividually Named
Respondents, Motion to Partially Vacate or Va1;ate Arbitration Award or in the Alternative.
Motion to Modify Award.' After considering the motion, all additional briefing filed by the
parties, the Court's file, and the parties' arguments, the Court has determined tbat the
Individually Named Respondents' Marion to Partially Vacate or Vacate Arbitration Award or in
the Alternative, Motion to Modify Award should be and hereby is DENJED.
Signed thls q day of_'J><
..J-APPENDIX 7
§ 101.106. Nature of Membership Interest, TX BUS ORG § 101.106
Vernon's Texas Statutes and Codes Annotated
Business Organizations Code (Refs & Annos)
Title 3. Limited Liability Companies (Refs & Annos)
Chapter 101. Limited Liability Companies (Refs & Annos)
Subchapter C. Membership
V.T.C.A., Business Organizations Code § 101.106
§ 101.106. Nature of Membership Interest
Effective: September 1, 2011
Currentness
(a) A membership interest in a limited liability company is personal property.
(a-1) A membership interest may be community property under applicable law.
(a-2) A member's right to participate in the management and conduct of the business of the limited liability company is not
community property.
(b) A member of a limited liability company or an assignee of a membership interest in a limited liability company does not
have an interest in any specific property of the company.
(c) Sections 9.406 and 9.408, Business & Commerce Code, do not apply to a membership interest in a limited liability company,
including the rights, powers, and interests arising under the company's certificate of formation or company agreement or under
this code. To the extent of any conflict between this subsection and Section 9.406 or 9.408, Business & Commerce Code, this
subsection controls. It is the express intent of this subsection to permit the enforcement, as a contract among the members of a
limited liability company, of any provision of a company agreement that would otherwise be ineffective under Section 9.406
or 9.408, Business & Commerce Code.
Credits
Acts 2003, 78th Leg., ch. 182, § 1, eff. Jan. 1, 2006. Amended by Acts 2009, 81st Leg., ch. 84, § 39, eff. Sept. 1, 2009; Acts
2011, 82nd Leg., ch. 139 (S.B. 748), § 35, eff. Sept. 1, 2011.
Notes of Decisions (6)
V. T. C. A., Business Organizations Code § 101.106, TX BUS ORG § 101.106
Current through Chapters effective immediately through Chapter 46 of the 2015 Regular Session of the 84th Legislature
End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works.
© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1
APPENDIX 8
§ 171.087. Confirmation of Award, TX CIV PRAC & REM § 171.087
Vernon's Texas Statutes and Codes Annotated
Civil Practice and Remedies Code (Refs & Annos)
Title 7. Alternate Methods of Dispute Resolution (Refs & Annos)
Chapter 171. General Arbitration (Refs & Annos)
Subchapter D. Court Proceedings (Refs & Annos)
V.T.C.A., Civil Practice & Remedies Code § 171.087
§ 171.087. Confirmation of Award
Currentness
Unless grounds are offered for vacating, modifying, or correcting an award under Section 171.088 or 171.091, the court, on
application of a party, shall confirm the award.
Credits
Added by Acts 1997, 75th Leg., ch. 165, § 5.01, eff. Sept. 1, 1997.
Notes of Decisions (27)
V. T. C. A., Civil Practice & Remedies Code § 171.087, TX CIV PRAC & REM § 171.087
Current through Chapters effective immediately through Chapter 46 of the 2015 Regular Session of the 84th Legislature
End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works.
© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1
APPENDIX 9
§ 171.090. Type of Relief Not Factor, TX CIV PRAC & REM § 171.090
Vernon's Texas Statutes and Codes Annotated
Civil Practice and Remedies Code (Refs & Annos)
Title 7. Alternate Methods of Dispute Resolution (Refs & Annos)
Chapter 171. General Arbitration (Refs & Annos)
Subchapter D. Court Proceedings (Refs & Annos)
V.T.C.A., Civil Practice & Remedies Code § 171.090
§ 171.090. Type of Relief Not Factor
Currentness
The fact that the relief granted by the arbitrators could not or would not be granted by a court of law or equity is not a ground
for vacating or refusing to confirm the award.
Credits
Added by Acts 1997, 75th Leg., ch. 165, § 5.01, eff. Sept. 1, 1997.
Notes of Decisions (2)
V. T. C. A., Civil Practice & Remedies Code § 171.090, TX CIV PRAC & REM § 171.090
Current through Chapters effective immediately through Chapter 46 of the 2015 Regular Session of the 84th Legislature
End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works.
© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1
APPENDIX 10
§ 9. Award of arbitrators; confirmation; jurisdiction; procedure, 9 USCA § 9
United States Code Annotated
Title 9. Arbitration (Refs & Annos)
Chapter 1. General Provisions (Refs & Annos)
9 U.S.C.A. § 9
§ 9. Award of arbitrators; confirmation; jurisdiction; procedure
Currentness
If the parties in their agreement have agreed that a judgment of the court shall be entered upon the award made pursuant to the
arbitration, and shall specify the court, then at any time within one year after the award is made any party to the arbitration may
apply to the court so specified for an order confirming the award, and thereupon the court must grant such an order unless the
award is vacated, modified, or corrected as prescribed in sections 10 and 11 of this title. If no court is specified in the agreement
of the parties, then such application may be made to the United States court in and for the district within which such award was
made. Notice of the application shall be served upon the adverse party, and thereupon the court shall have jurisdiction of such
party as though he had appeared generally in the proceeding. If the adverse party is a resident of the district within which the
award was made, such service shall be made upon the adverse party or his attorney as prescribed by law for service of notice
of motion in an action in the same court. If the adverse party shall be a nonresident, then the notice of the application shall be
served by the marshal of any district within which the adverse party may be found in like manner as other process of the court.
CREDIT(S)
(July 30, 1947, c. 392, 61 Stat. 672.)
Notes of Decisions (439)
9 U.S.C.A. § 9, 9 USCA § 9
Current through P.L. 114-25 (excluding P.L. 114-18) approved 6-15-2015
End of Document © 2015 Thomson Reuters. No claim to original U.S. Government Works.
© 2015 Thomson Reuters. No claim to original U.S. Government Works. 1
APPENDIX 11
CASE NUMBER 70-193-000608-12
ALAN BENTZ, M.D., § BEFORE THE AMERICAN
§ ARBITRATION ASSOCIATION
Claimant, §
§
v. §
§
GEORGE M. DAVIS, M.D., WOODROW §
V. DOLINO, M.D., ANTENEH T. ROBA, §
M.D., LEVON VARTANIAN, M.D., §
HOUSTON NORTHWEST EMERGENCY §
SPECIALISTS PLLC, NORTHWEST §
HOUSTON EMERGENCY SPECIALISTS §
GROUP, P.L.L.C., ESG MD, P.L.L.C., and §
ESG MLP, L.L.C., §
§
Respondents. § MR. ROBERT WOOD, ARBITRATOR
CLAIMANT DR. ALAN BENTZ’S PREHEARING BRIEF
FULBRIGHT & JAWORSKI L.L.P.
Andrew Price
State Bar No.: 24002791
Rachel Roosth
State Bar. No.: 24074322
Fulbright Tower
1301 McKinney, Suite 5100
Houston, Texas 77010-3095
Telephone: (713) 651-5151
Facsimile: (713) 651-5246
-i-
“unjustifiable and likely to cause serious harm.” It is difficult to see how Dr. Bentz’s offer could
meet that standard when Mr. Nguyen did not have authority to change the schedule without the
permission of other doctors, and when Mr. Nguyen often received bonuses from the Entities for
facilitating schedule changes.
Because Dr. Bentz was not expelled for proper reasons, Dr. Bentz’s expulsion violated
the Company Agreements. NHESG, ESG MD, ESG MLP, and the Individual Respondents are
bound to the Company Agreements. Thigpen v. Locke, 363 S.W.2d 247, 253 (Tex. 1962)
(signatories to valid contracts are bound by those contracts); Tex. Bus. Org. Code §
101.052(a)(1)(“. . . the company agreement of a limited liability company governs . . . the
relations among members, managers . . ., and the company itself.”); see also Seven Hills
Commercial, LLC v. Mirabal Custom Homes, Inc., No. 05-13-01306-CV, 2014 WL 3867837 at
*10 (Tex. App.—Dallas Aug. 7, 2014, no pet. h.) (LLCs are bound by their company
agreements). The respective Entities should be required to purchase Dr. Bentz’s interest, and
they are liable for the damages caused by their breaches, including for payment of the damages
which are set forth below in Sections III.C, III.D, III.E, and III.F. See In re White, 429 B.R. at
211, 216–19 (holding that the terminated employee was entitled to post-termination distributions
and either a buyout per the terms of the shareholders’ agreement or an injunction requiring,
among other things, that the company pay the terminated employee his pro rata share of any
future distributions).
C. Even if the Respondents properly expelled Dr. Bentz, they have still breached the
Company Agreements by failing to pay him Fair Market Value of his Membership
Interest.
Even if Respondents did properly expel Dr. Bentz (which they did not), they have
breached the Company Agreements by failing to fulfill their post-expulsion procedural
53656506.5 - 39 - | 01-03-2023 | 09-29-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3397989/ | The bill of complaint herein alleges in effect that Martha J. Brown by will disposed of her property by specific bequests and devises not affecting the property here involved and by a residuary devise and bequest to others than complainant, who is a nephew of the testatrix; that subsequently to the making of her said will, Martha J. Brown, "realizing that her term of life was growing short and having meantime formed the desire and intention not to leave your orator and his family entirely unprovided for, expressed to your orator and others her desire and intention to select and purchase for your orator a farm or grove which would provide him and his family with a home and means of support and to give the same to your orator as soon as she was satisfied he would properly care for and cultivate the same, and to that end examined in company with your orator, who went with her at her express instance and request, several properties in said Hillsborough County and finally selected and purchased from G. L. Stokes and his wife on the 23rd day of October, 1917, a tract of land with an orange grove thereon near the town of Dover in said Hillsborough County more particularly described as the east half of the southwest quarter of the southwest quarter, of section thirty-two (32), township twenty-eight (28) south, of range twenty-one (21) east, taking a deed of conveyance therefor in her own name and causing the same to be recorded in Deed Book No. 237, on page 278, in the office of the Clerk of this Court; that at the time of the selection *Page 535
and purchase of the tract of land aforesaid by said Martha J. Brown for the purpose aforesaid your orator was engaged under a contract for the care and cultivation of a farm on shares with William Nelms and E. E. Cone and, while so engaged, the said Martha J. Brown, because of her desire to make some provision for your orator out of her estate and to induce him to accept her offer, proposed to and promised him that, if he would cease and separate from his said employment and contract for running said farm on shares and would move to, live upon and cultivate the above described tract of land so as to provide a home for himself and family, she would conclude the purchase of the same for him, taking the title in her own name but promising and agreeing that she would give said tract of land to him upon his compliance with her wish that he would move his family upon the same, make a home for them there and care for and cultivate the place; and that, confiding in said promise and agreement, and upon the consideration thereof, your orator accepted said offer of said Martha J. Brown, the latter completed the purchase of said property by obtaining a deed therefor as above set forth, and your orator proceeded to carry out and comply with the terms of said agreement on his part by terminating the contract and arrangement by which he was then occupied in farming on shares as aforesaid, moving his residence and family to and upon the tract of land and farm so purchased for him by said Martha J. Brown and described as above, making his and their home there, and starting upon the care and cultivation of the same; that thereafter said Martha J. Brown frequently visited your orator at his home on the farm, above described, expressed her satisfaction at the compliance of your orator on his part with the terms of said agreement in consideration of which he had been placed by her in possession thereof, and about the time of the last of such visits declared that upon her return to her place of residence she intended at *Page 536
once to have the papers fixed necessary to comply with the promise made by her and to give to your orator the ownership of the tract of land aforesaid; that said last visit occurred on or about the 28th day of January, 1918, and immediately upon her return therefrom she was taken seriously ill before being able to carry out her intention aforesaid in favor of your orator; and that her illness rapidly grew worse until she became unconscious and shortly thereafter, to-wit, on the first day of February, 1918, the said Martha J. Brown died without having the opportunity or physical ability to arrange or provide for the execution of the papers necessary to fulfil her promise and intention expressed as aforesaid in favor of your orator, her age being about seventy-four years."
The prayer is "that the promise and agreement made by said Martha J. Brown in her lifetime with your orator as hereinbefore set forth may be declared and decreed to be made upon valid and sufficient consideration and to be binding upon her executor and residuary devisees; that said defendant devisees, to-wit, India S. A. Poston, Arthur L. Poston, William Poston, Hampton Poston, Myrtle Poston, Eleanor Poston, Ray Poston and Mabel Poston, may be declared and decreed to hold the legal title in fee simple and the right to the income of the farm hereinafter described in trust for the use and benefit of your orator; that said defendants may be further ordered and decreed to convey to your orator by good and sufficient deed all their right, title and interest in said farm, that is to say, said India S. A. Poston to convey her right to the income from said farm during the term of her life, and the defendant devisees, her children, to convey their fee simple title to the same; that the guardian ad litem of those defendants who are infants or some other impartial person be named by this court to execute such conveyance on behalf of such infants; and that your orator may have such *Page 537
other and further relief as equity may require and to your Honor may seem meet."
The answer denies the material allegations of the bill and avers "that the complainant without right or title has occupied the said land as herein described since the death of Martha J. Brown, receiving the rents and profits therefrom without accounting to these defendants or to the executor of the estate of Martha J. Brown, deceased, whose duty it is to collect the rents, issues and profits of the said land, and preserve the same and pay over to these defendants, yet the complainant so occupying the said property, a valuable orange grove in bearing, and producing a large income, receives the income from the sale of the fruit and other farm products, and wrongfully appropriates the same to his own use, in duty bound, the complainant ought to be required to account for the oranges sold from the said orange grove or the proceeds arising from the sale thereof and other products from the said farm to these defendants, or the executor of the estate of Martha J. Brown, deceased."
This appeal was taken from a decree dismissing the bill of complaint on final hearing on the pleadings and evidence.
Assuming that the evidence accords with the allegations of the bill, it is insufficient to justify the equitable relief prayed. Whatever may have been the intention of the testatrix to make a voluntary provision for her nephew, she did not in fact do so except to accord him the privilege during her life of living on and utilizing the place purchased by her after making her will. Her residuary devise carried the title and beneficial interest in the property to others at her death. Sec. 3594, Rev. Gen. Stats., 1920.
The allegations and evidence show a voluntary gift of the use of the property to the complainant which benefited him, but do not show a binding promise predicated *Page 538
upon sufficient consideration to warrant a decree establishing a trust in the property in favor of the complainant as against the residuary devisees under the will of the testatrix.
Where one buys in her own name real estate for the use of a nephew and puts him in possession and promises to give the property to him if he so conducts himself in using the property as to satisfy the owner, and the owner expresses approval of the conduct of the nephew as the occupant of the premises, but the owner does not give or attempt to give the title to the property to the nephew during her life, and no personal or financial benefits accrued to the owner by the nephew's use of the property, but the use of the property during the life of owner was beneficial to the nephew, a trust will not on the facts of this case, be decreed in the property as against the residuary devisees under the owner's will which pursuant to the statute embraces "property owned by the testator at the time of his death."
Affirmed.
STRUM AND BROWN, J. J., concur.
WEST, C. J., AND ELLIS AND TERRELL, J. J., concur in the opinion. *Page 539 | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4554001/ | United States Court of Appeals
For the Eighth Circuit
___________________________
No. 19-2182
___________________________
United States of America
lllllllllllllllllllllPlaintiff - Appellee
v.
Lorando Demond Williams
lllllllllllllllllllllDefendant - Appellant
____________
Appeal from United States District Court
for the Southern District of Iowa - Des Moines
____________
Submitted: April 13, 2020
Filed: August 7, 2020
____________
Before LOKEN, SHEPHERD, and ERICKSON, Circuit Judges.
____________
LOKEN, Circuit Judge.
Conducting surveillance based on a tip that Ronald Buchanan was distributing
drugs from a white Mercedes-Benz in a church parking lot, Des Moines police
officers observed two men exiting a white Mercedes-Benz to meet with occupants of
vehicles driving in and out of the parking lot. Suspecting these were drug
transactions, two officers approached the Mercedes-Benz and detected a strong odor
of marijuana. Buchanan was in the driver’s seat and Lorando Williams was in the
passenger’s seat. The officers searched the car and the two men. They found $313
and 11.97 grams of cocaine base on Williams’s person. In the driver’s door pocket,
they found a baggie containing 43.8 grams of marijuana and a Crown Royal bag
containing 27.32 grams of cocaine, 18.59 grams of cocaine base, and 0.7 grams of
marijuana. A baggie in the front passenger seat contained 2.87 grams of cocaine, and
a bottle in the car’s center console contained 86 grams of codeine. Williams pleaded
guilty to possession with intent to distribute cocaine base, admitting he possessed the
drugs found on his person. See 21 U.S.C. § 841(a)(1), (b)(1)(C).
At the May 2019 sentencing, the district court1 found that Williams’s relevant
offense conduct included possession of all drugs found in the car because they were
part of “jointly undertaken criminal activity” with Buchanan. This resulted in a base
offense level of 24 and an advisory guidelines sentencing range of 77 to 96 months
imprisonment. The court imposed a 77 month sentence, rejecting Williams’s request
for a downward variance to account for any future state court sentence that would
follow revocation of the parole Williams was serving for an Iowa drug and firearm
conviction. Williams appeals, arguing the district court (i) committed plain
procedural sentencing error by failing to rule on his requests for concurrent sentences
and for a federal sentence reduction to account for “potential future actions of Iowa’s
Parole Board,” and (ii) clearly erred in attributing drugs found in the driver’s door
pocket to Williams. We affirm.
I. The Concurrent Sentence Issue.
Williams was serving parole for the 2015 Iowa conviction when he committed
this federal offense. Parole had not been revoked at the time of his federal
sentencing. Had parole been revoked, the advisory guidelines recommend “that the
1
The Honorable Robert W. Pratt, United States District Judge for the Southern
District of Iowa.
-2-
sentence for the instant offense be imposed consecutively to the sentence imposed for
the revocation.” USSG § 5G1.3, comment. (n.4(C)). Here, revocation was only
anticipated. In these circumstances, the court “has discretion to determine whether
a federal sentence should run concurrently with or consecutively to an anticipated
state sentence.” United States v. Hall, 825 F.3d 373, 375 (8th Cir. 2016), citing
Setser v. United States, 566 U.S. 231, 235-36 (2012). A district court should exercise
this discretion “intelligently.” Setser, 566 U.S. at 242 n.6.
In his objections to the Presentence Investigation Report (“PSR”), Williams
requested that his sentence “run fully concurrent” to the 2015 Iowa sentence. His
Sentencing Memorandum explained that, if the State of Iowa proceeds to revoke
parole, the Bureau of Prisons “is likely to deny credit for any time for which he is
awarded Iowa credit.” Therefore, to credit Williams “with all the time he has served,”
the Court should “order the sentences run concurrently, select the appropriate
[federal] sentence, then reduce the sentence by the number of months between his
first incarceration date of October 23, 2018 and the date of sentencing.” The
Probation Officer responded: “Because the state sentence has not been revoked, the
Court may run the term for the instant offense consecutive or concurrent to the state
offense; however, the Court may also exercise its discretion and refrain from any
such order” (emphasis added).
At sentencing, the district court asked defense counsel to clarify the “5G1.3
argument” regarding an anticipated state prison term. Counsel responded that
Williams’s parole had not yet been revoked “but he may be subject to revocation.
The court has the discretion to run this sentence concurrently or consecutively with
that [under USSG § 5G1.3(d)].” Counsel urged the court to “use that tool as another
means . . . to exercise its discretion to give the defendant a reasonable sentence in this
case.” Turning to the 18 U.S.C. § 3553(a) sentencing factors, counsel then argued
that “the court should look at something substantially lower than what’s
recommended under the advisory guideline range.” Government counsel, in urging
-3-
a sentence in the middle of the guidelines range, 86 months, responded that
Application Note 4(C) to § 5G1.3 recommends that “the federal sentence be imposed
consecutive to any revocation of parole.” At the conclusion of these arguments, the
district court stated, “based on the 3553(a) analysis,” that it would impose a sentence
at the bottom of the advisory range -- 77 months imprisonment with credit for time
served since October 23, 2018. As to whether the State of Iowa may revoke parole
and impose an anticipated term of imprisonment, “the court in its discretion is not
going to address that.” Defense counsel made no objection to this last ruling.
On appeal, Williams puts a new spin on this aspect of the sentencing
proceedings. He now contends that the district court committed procedural error by
failing to rule on his “objections” regarding the anticipated revocation of parole and
his request for a downward variance on this ground. He asserts the district court “did
not demonstrate an awareness that it was or might be consigning Williams to serve
consecutive sentences,” “did not address at all Williams’s concern about the possible
parole revocation,” and “appears not even to have addressed . . . whether Williams
might be deemed by Iowa . . . to be in primary state custody” after his arrest and “the
effect that this determination might have on the [Bureau of Prisons execution of the]
sentence [the court] imposed.” This contention insults the intelligence of one of our
most experienced sentencing judges. Though perhaps creative, it is also without
merit for several reasons.
First, in exercising discretion not to address Williams’s request that the
sentence be made concurrent with an anticipated state sentence, the district court
adopted the Probation Officer’s recommendation that it “refrain from any such order.”
Thus, the premise for Williams’s contention that the district court erred in failing to
rule is the assertion, first made in his brief on appeal without supporting authority,
that the Probation Officer’s “view, unsupported by legal authority . . . is incorrect.”
That is an issue of law, known to defense counsel when the district court ruled. As
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Williams did not raise this issue to the district court, it was not preserved for appeal.
See United States v. Collier, 585 F.3d 1093, 1097 (8th Cir. 2009).
Second, the Probation Officer’s view is not “unsupported by legal authority.”
Rather, it is supported by the most powerful of authorities, the Supreme Court of the
United States. In Setser, after stating that a district court should exercise its
discretion intelligently when dealing with an anticipated state sentence, the Court
stated: “In some situations, a district court may have inadequate information and may
forbear.” 566 U.S. at 242 n.6 (emphasis added); see United States v. Davis, 859 F.3d
572, 575 (8th Cir. 2017) (“The district court did not err by expressly not considering
the fact that [the defendant’s] probation could possibly be revoked,” citing Setser.).
Third, even without this controlling authority, it should go without saying that
one way to exercise discretion is to decline to take up an issue because the proper
exercise of discretion turns on future events. The district court clearly understood its
discretionary authority -- identifying USSG § 5G1.3(d) as the relevant guideline --
and chose “in its discretion” to forbear for this reason. We review that decision for
abuse of discretion. See Hall, 825 F.3d at 375-76. Labeling it a failure-to-rule
procedural error is ludicrous.
Finally, Williams does not argue the district court abused its discretion, and
with good reason. Williams urged the district court to vary downward from the
within-range sentence the court thought appropriate, applying the § 3553(a)
sentencing factors, based on actions the Iowa Board of Parole, an Iowa state court,
and the federal Bureau of Prisons might take in the future. Failure to explain why it
did not vary downward for this reason when Williams did not request further
explanation was neither an abuse of discretion nor plain error. See, e.g., United
States v. Lee, 553 F.3d 598, 600-01 (8th Cir. 2009).
-5-
II. The Drug Quantity Issue.
The PSR recommended that all drugs found in the car should be attributed to
Williams in determining his offense conduct. Williams objected that only the drugs
found on his person should be included. In response, the Probation Officer noted the
relevant conduct provisions, USSG § 1B1.3(a)(1)(A) and (B), and stated:
In response to a complaint of Buchanan distributing drugs from a church
parking lot, law enforcement officers (LEO) initiated surveillance and
observed Buchanan and the defendant entering and exiting a Mercedes-
Benz while multiple vehicles came and went from the church parking lot
with the occupants appearing to be meeting with Buchanan and the
defendant. LEO believed these actions to be consistent with drug
transactions. Therefore, the drugs in the Mercedes-Benz, whether
possessed by Buchanan, the defendant, or both were within the scope of
the jointly undertaken criminal activity, in furtherance of the offense,
and reasonably foreseeable in connection with the distribution of drugs.
As a result, defendant is attributed all the drugs in the vehicle.
At sentencing, the district court adopted the Probation Officer’s reasoning and
overruled Williams’s drug quantity objection.
On appeal, Williams argues this drug quantity finding lacked a sufficient
factual basis to attribute the drugs found in the driver’s door pocket to Williams under
governing relevant conduct principles. We review the district court’s quantity finding
for clear error. See United States v. Escobar, 909 F.3d 228, 246 (8th Cir. 2018)
(standard of review). The government argues that unobjected-to facts recited in the
PSR support attributing the drugs in the driver’s door pocket to Williams and, in any
event, any drug quantity error was harmless.
The Guidelines include as relevant conduct “all acts or omissions of others that
were (i) within the scope of the jointly undertaken criminal activity, (ii) in furtherance
-6-
of that criminal activity, and (iii) reasonably foreseeable in connection with that
criminal activity that occurred during the commission of the offense of conviction.”
USSG § 1B1.3(a)(1)(B). Application Note 3(A) defines “jointly undertaken criminal
activity” as “a criminal plan, scheme, endeavor, or enterprise undertaken by the
defendant in concert with others, whether or not charged as a conspiracy.”
Focusing on the fact that Williams in pleading guilty only admitted intent to
distribute the cocaine found on his person, and on the PSR statement that Buchanan
admitted knowledge of the Crown Royal bag and baggie found in the driver’s door
pocket, Williams argues “there was insufficient basis for the district court to conclude
that Buchanan had been dealing drugs along with Williams as part of a jointly
undertaken criminal activity.” But this focuses the issue too narrowly. In
determining the scope of “jointly undertaken criminal activity,” the district court
“may consider any explicit agreement or implicit agreement fairly inferred from the
conduct of the defendant and others.” USSG § 1B1.3, comment. (n.3(B)); see United
States v. Sacus, 784 F.3d 1214, 1219-20 (8th Cir. 2015). Here, as the Probation
Officer noted, Williams and Buchanan were jointly engaged in selling drugs to
multiple buyers from the white Mercedes-Benz. Even if they distributed different
drugs and each brought his own supply and would keep the proceeds of his individual
sales, the district court did not clearly err in finding that this was jointly undertaken
criminal activity and therefore the total quantity of unsold drugs found in the car
should be attributed to each participant. See Escobar, 909 F.3d at 246-47.
We also agree with the government that any error in determining drug quantity
for sentencing purposes was harmless. The district court expressly stated, “if I’ve
erred in the advisory guideline, I would sentence the defendant to 77 months based
on the § 3553(a) analysis. I always think . . . drug quantity is a poor substitute for
culpability here, and I don’t think that the guideline about drug quantity has much
relationship to the sentence that I find to be sufficient but not greater than necessary.”
We have repeatedly held that an error in applying the guidelines is harmless if the
-7-
district court in explaining the sentence “makes clear that the judge based the
sentence . . . on factors independent of the Guidelines.” United States v. McGee, 890
F.3d 730, 737 (8th Cir. 2018) (quotation omitted).
The judgment of the district court is affirmed.
______________________________
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https://www.courtlistener.com/api/rest/v3/opinions/4554011/ | Case: 19-14197 Date Filed: 08/07/2020 Page: 1 of 6
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 19-14197
Non-Argument Calendar
________________________
D.C. Docket No. 8:18-cv-01982-SPF
ESTILITA RODRIGUEZ TORRES,
Plaintiff-Appellant,
versus
COMMISSIONER OF SOCIAL SECURITY,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Middle District of Florida
________________________
(August 7, 2020)
Before WILSON, LUCK, and ANDERSON, Circuit Judges.
PER CURIAM:
Case: 19-14197 Date Filed: 08/07/2020 Page: 2 of 6
Estilita Rodriguez Torres appeals the district court’s decision affirming the
Social Security Administration’s denial of her applications for a period of disability
and disability insurance benefits. Torres contends that the administrative law judge
(ALJ) erred in refusing to give res judicata effect to a previous ALJ’s determination
that Torres was severely disabled from fibromyalgia. We affirm.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
On November 18, 2010, Torres applied to the Social Security Administration
for a period of disability and disability insurance benefits, alleging she had become
disabled on July 15, 2010. An ALJ denied Torres’s application on April 17, 2013
because, although she had not worked since July 15, 2010 and had a severe medical
impairment due to fibromyalgia, her impairment was not equivalent to those listed
in the federal regulations. Thus, for the period of July 15, 2010 through April 17,
2013, Torres was not entitled to a period of disability and disability insurance
benefits.
Two years later, Torres again filed for a period of disability and disability
insurance benefits, claiming that she was disabled due to fibromyalgia for a different
period of time––from April 18, 2013 through December 31, 2013. This time, the
ALJ determined that Torres’s claim failed because “there were no medical signs or
laboratory findings to substantiate the existence of a medically determinable
impairment.” The ALJ emphasized that Torres did not provide any treatment
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records during the relevant period that would support her claim. According to the
ALJ, Torres’s treatment records “extend[ed] through January 2013, with no further
treatment records until June 9, 2014.” Torres admitted “to a significant gap in her
treatment history” and testified that, even though her condition has worsened over
the years, it was “not as bad” in 2013. The ALJ concluded that there was
“insufficient subjective and objective evidence, and no medical signs or laboratory
findings, to substantiate the existence of a medically determinable impairment
through the date last insured.” The ALJ concluded that he was not bound by the
decision on Torres’s previous application because this case dealt with an
“unadjudicated period,” that is, the period after April 17, 2013, when the Social
Security Administration decided her last disability claim.
After the Appeals Council declined to review the ALJ’s decision, Torres
sought review in the district court. Torres argued that the doctrine of administrative
res judicata bound the ALJ to the previous ALJ’s decision as to the severity of her
impairment. The district court affirmed the ALJ’s denial of benefits, concluding that
(1) res judicata did not bind the ALJ to the previous decision on the severity of
Torres’s impairment because the previous decision was based on a different time
period, and (2) the ALJ’s decision was supported by substantial evidence. Torres
appeals.
STANDARD OF REVIEW
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Case: 19-14197 Date Filed: 08/07/2020 Page: 4 of 6
“[W]e review de novo the legal principles upon which the [ALJ]’s decision is
based.” Moore v. Barnhart, 405 F.3d 1208, 1211 (11th Cir. 2005). “The [ALJ]’s
failure to apply the correct law or to provide the reviewing court with sufficient
reasoning for determining that the proper legal analysis has been conducted
mandates reversal.” Cornelius v. Sullivan, 936 F.2d 1143, 1145–46 (11th Cir. 1991).
DISCUSSION
Torres argues here, as she did before the district court, that the doctrine of
administrative res judicata bound the ALJ to the previous determination that Torres
had the medically severe impairment of fibromyalgia. Administrative res judicata
applies when an agency has “made a previous determination or decision . . . about
[a claimant’s] rights on the same facts and on the same issue or issues, and [that]
previous determination or decision has become final by either administrative or
judicial action.” 20 C.F.R. § 404.957(c)(1); see also Cash v. Barnhart, 327 F.3d
1252, 1255 (11th Cir. 2003). The question before us is whether the previous
determination that Torres suffered from a severe impairment based on fibromyalgia
before April 17, 2013 is the “same fact” and “same issue” that was before the ALJ
in Torres’s disability claim for a different and later time period.
We agree with the district court that the previous determination did not
determine the same facts and issues as this case and the ALJ was not bound by
administrative res judicata. “Any earlier proceeding that found or rejected the onset
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of a disability could rarely, if ever, have actually litigated and resolved whether a
person was disabled at some later date.” See Earley v. Comm’r of Soc. Sec., 893
F.3d 929, 933 (6th Cir. 2018) (internal quotation marks omitted)); see also Albright
v. Comm’r of Soc. Sec., 174 F.3d 473, 476 (4th Cir. 1999) (“The [Social Security
Administration] treats a claimant’s second or successive application for disability
benefits as a claim apart from those earlier filed, at least to the extent that the most
recent application alleges a previously unadjudicated period of disability.” (footnote
omitted) (internal quotation marks omitted)); Rucker v. Chater, 92 F.3d 492, 495
(7th Cir. 1996) (“The first ALJ’s finding was a binding determination with respect
to [the claimant]’s eligibility for disability benefits for that time period. It has no
effect, however, on an application for disability benefits for a subsequent time
period.”); see also Tomaszewski v. Colvin, 649 F. App’x 705, 706 (11th Cir. 2016)
(unpublished) (holding that “res judicata [did] not apply because [the claimant]’s
new [disability] application cover[ed] a different time period, and involve[d] new
evidence that [was] independent from the prior application”); Griffin v. Comm’r of
Soc. Sec., 560 F. App’x 837, 844 (11th Cir. 2014) (unpublished) (declining to apply
administrative res judicata when “the prior [ALJ’s] decision did not finally
adjudicate any issues or facts that were raised in this proceeding”); McKinzie v.
Comm’r of Soc. Sec., 362 F. App’x 71, 73 (11th Cir. 2010) (unpublished) (“[A]n
ALJ should not consider prior applications when the instant application involves a
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different period of time than that alleged in the prior applications.”); Moreno v.
Astrue, 366 F. App’x 23, 27 (11th Cir. 2010) (unpublished) (refusing to “give
preclusive effect” to a prior determination because the “instant application
concerned an unadjudicated time period”); Luckey v. Astrue, 331 F. App’x 634, 638
(11th Cir. 2009) (unpublished) (“Because the factual time period for [the claimant]’s
current application is different from her previous application, administrative res
judicata does not apply.”). Because the ALJ was not bound by the previous
determination of Torres’s disability, and there was substantial evidence supporting
the ALJ’s determination that she was not disabled from April 18, 2013 to December
31, 2013,1 we agree with the district court that the ALJ’s decision was due to be
affirmed.
AFFIRMED.
1
The substantial evidence supporting the ALJ’s decision included: (1) Torres did not
provide or cite to any medical records, evidence, or testing that occurred from April 18, 2013 to
December 31, 2013; (2) Torres testified that she did not seek treatment in 2013 because her
condition was not “as bad” that year; and (3) a 2015 consultative evaluation concluded that
Torres’s condition was non-severe.
6 | 01-03-2023 | 08-07-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3854411/ | Argued October 11, 1928.
Plaintiffs' complaint that their motion for judgment for want of a sufficient affidavit of defense was refused, must be sustained. They brought assumpsit on a simple contract in writing to recover $2,000, the consideration named, for services rendered. The affidavit of defense admitted the contract and performance by plaintiffs, but in defense, averred that in accepting plaintiffs' proposal, defendant "was acting as agent for parties known to the plaintiffs" and that the agreement with plaintiffs was that defendant should not be liable to pay for the services, but that his principal, one Wilcox, would be responsible.
The paper appears to have been a proposal to render personal services to defendant; at the foot of it defendant wrote "accepted by Joseph B. Simon, June 7, 1927." It is addressed to defendant and states that plaintiffs would "prepare for you" certain information to be obtained by a survey "on the proposed hotel to be erected on the site of the Hotel Stenton;" that plaintiffs would "confer with your architects ......;" "you are to furnish us with the following data ...... (c) your estimate of the cost of the building ...... (d) your outline of the manner of financing." These quotations, containing the words `you' and `your,' show clearly that the service was to be performed for defendant; there is nothing in the paper indicating that any one else was interested. Certainly, *Page 413
on the face of the paper, defendant is liable; to avoid responsibility he must contradict the writing and show that the agreement was different from what is written; the only question is whether his averments bring him within the law permitting him to do it. Plaintiffs contend that the averment that defendant acted for a principal not named in the paper but at the time known to them, is not sufficient to relieve him from responsibility to pay for the services admittedly rendered pursuant to the proposal accepted by him. They do not question the rule that on a proper showing an undisclosed principal may be held; they insist that mere assertion in the affidavit that defendant acted for another amounts to nothing without adequate averment that the fact of agency and release from the responsibility resulting from his signature were omitted from the writing by fraud, accident or mistake.
As the contract is complete on its face, its meaning must be determined by the court. Plaintiffs agreed to perform certain services for defendant; defendant agreed to supply certain data and to pay $2000; there is nothing in the record to show that anything was omitted; in such circumstances, oral evidence cannot be received to strike out the provisions that the service was to be rendered for the defendant at his expense, and to substitute the obligation of some one else.
The general principles have been stated as follows:
"Undoubtedly an agent who makes a contract in his own name without disclosing his agency is liable to the other party. The latter acts upon his credit and is not bound to yield up his right to hold the former personally, merely because he discloses a principal who is also liable. The principal is liable because the contract was for his benefit, and the agent is benefited by his being presumably the creditor, for there can be but one satisfaction. But it does not follow that the agent can afterwards discharge himself by putting the *Page 414
creditor to his election. Being already liable by his contract, he can be discharged only by satisfaction of it, by himself or another. So the principal has no right to compel the creditor to elect his action, or to discharge either himself or his agent, but can defend his agent only by making satisfaction for him." Beymer v. Bonsall, 79 Pa. 300.
"Cases may be found, also, where it is held that the plaintiff may prove by parol that the other contracting party named in the contract was but the agent of an undisclosed principal, and in that state of the case he may have his remedy against either, at his election. Evidence to that effect will be admitted to charge the principal or to enable him to sue in his own name, but the agent who binds himself is never allowed to contradict the writing by proving that he contracted only as agent, and not as principal": Nash v. Towme, 5 Wall. 689, 704. For cases where evidence will be received (not to contradict but merely to explain the writing) see Whitney v. Wyman,101 U.S. 392, 396; Post v. Pearson, 108 U.S. 418; Sun Printing Co. v. Moore, 183 U.S. 642; Rederi, etc. v. Drughorn, Ltd. (1918), 1 K.B.D. 394. Of course, where the contract is oral, or partly oral and partly written, evidence will be received to show that a party dealt with an agent for an undisclosed principal: Paine v. Berg, 23 Pa. Super. 577; Robinson v. Wallace, 65 Pa. Super. 54. A person contracting as agent will be personally liable, whether he is known to be agent or not, in all cases where he makes the contract in his own name or voluntarily incurs a personal responsibility either expressed or implied: Story, Agency (9th Ed.) section 269. See also Higgins v. Senior, 8 N. W. 834; Williston, Contracts, sections 284, etc.
It is settled in this state that to prevent judgment for want of sufficient affidavit of defense in a suit on a simple contract, it is not enough to deny that defendant *Page 415
assumed the obligation contained in his writing; to avoid the effect of his written obligation he must aver facts sufficient, if proved, to induce a chancellor to reform the instrument: Dynamo, etc. Co. v. Cement Co., 221 Pa. 160; Morgan, Smith Co. v. Water Power Co., 221 Pa. 165; Phila. Motor, etc. v. Paulson,69 Pa. Super. 338; Cain v. Marick, 91 Pa. Super. 129,136. Defendant has made no such averment.
Appellant relies on Hubbert v. Borden, 6 Whart. 79, but the case has no relation to this; in that case plaintiff declared, not on a written instrument, but on an oral contract (page 87); the rule against oral evidence to contradict a written contract complete in itself was therefore not involved.
The judgment is reversed and the record is remitted with instructions to enter judgment against the defendant for such sum as to right and justice may belong, unless other legal or equitable cause be shown why such judgment should not be so entered. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3854671/ | Argued October 26, 1937.
The plaintiff brought this action of trespass to recover the damages alleged to have been done to her land and buildings by the defendant's negligent and unlawful discharge of water which had gathered or accumulated on its land.
The plaintiff is the owner of certain lots or parcels of ground in Swatara Township, Dauphin County, on which are erected a dwelling house, hog pen, chicken house, stable, wagon shed and other outbuildings. She lived in the dwelling and used the land for the raising of vegetables, fruits and other market produce.
On August 20, 1928 the defendant acquired from the Pennsylvania Railroad Company title to a strip of land, of some considerable length, formerly used as part of the bed of the Pennsylvania Canal. The canal has been abandoned for transportation purposes, but surface water from the hills or high ground north of it continues to flow into the canal bed and is confined there by the canal banks, and the water which thus accumulates there flows in the strip or section owned by defendant and in times of high water the old canal *Page 325
is filled to overflowing. A year or two before the defendant acquired title to the section of canal owned by it, its predecessor in title, Pennsylvania Railroad Company, had built or constructed through the south bank of the canal at a point near plaintiff's lands, a terra cotta drain or pipe, 24 inches in diameter, for the purpose of discharging water from the canal into a natural water course a little south of and roughly parallel with the canal. Defendant continued the maintenance of this pipe or drain; but the water accumulating in the canal in times of flood caused large breaks or washouts in the south bank of the canal, through which the accumulated water in the canal was discharged into said natural water course, which was not large enough to carry it away and it overflowed in great volume onto plaintiff's lands, which were about ten feet lower than the canal bed. The defendant took no steps to repair these breaks or prevent the discharge of the water accumulated in its canal onto plaintiff's land. The water thus discharged onto plaintiff's lands, it was averred, had permanently injured the soil, by washing away the top soil and depositing sand, so that it was of no value whatever for the growing of crops; and the water thus accumulated and discharged on plaintiff's land had permanently weakened and injured the foundations and buildings on her land. The plaintiff claimed, and the trial was conducted on the theory, that the defendant's acts in thus negligently and illegally permitting the discharge of the water which had accumulated in the section of canal owned by it constituted a permanent and lasting trespass which had virtually ruined her land and buildings and entitled her to recover from the defendant their value, the market value of the same after such damage being practically nothing. Consequently the measure of damages employed on the trial was the difference in value of the plaintiff's property immediately before the defendant *Page 326
acquired title and permitted the negligent and illegal discharge of the accumulated water on plaintiff's land and the value after such discharge had injured plaintiff's land. The defendant did not object to this measure of damages and presented no other on the trial, and the plaintiff having presented it as the measure to be applied and having tried her case on that theory is not in a position to ask that another measure be applied. She recovered a verdict of $1,900, on which judgment was entered. It represents the total amount recoverable by the plaintiff for the alleged negligent and illegal acts of the defendant, considered as a permanent condition.
The defendant, however, has appealed and asks that judgment be entered in its favor non obstante veredicto. It has also filed an assignment of error to the competency of one Zimmerman to testify as a witness for the plaintiff on the subject of her damages. The defendant filed a motion for a new trial as well as a rule for judgment non obstante veredicto. In the opinion of the court discharging the rule for judgment non obstante veredicto the court below stated that the motion for a new trial was not pressed and had been abandoned. The defendant took no exception to this statement, but apparently moved for a re-argument on its motion for judgment non obstante veredicto, which was granted; and following such re-argument, the court below filed a more extended opinion refusing to enter judgment non obstante veredicto in which the court stated: "On the earnest petition of the defendant the order directing the entry of judgment was revoked and the motion of the defendant for judgment non obstante veredicto was again argued before the full Bench of this Court. In this latter proceeding the defendant again conceded that the motion for a new trial was not being pressed and relied solely upon the motion for judgment notwithstanding the verdict." *Page 327
Having, in effect, abandoned its motion for a new trial in the court below, defendant cannot revive it in this court. A losing party may appeal to an appellate court from a judgment in the court below, without asking for a new trial (Detwiler v. Bowers,9 Pa. Super. 473); but, if it moves for a new trial, it should not be allowed to abandon its motion on the argument in the lower court and then press it here. Fair treatment of the trial court forbids such a course. We may add, however, that we think the witness was competent to testify and his testimony was receivable and sufficient. The alleged defects in his testimony at the close of his direct examination were remedied on cross-examination (p. 142a). Judgment non obstante veredicto could not be entered for the defendant, on this ground, for the plaintiff was entitled to nominal damages on her evidence, even in the absence of proof of special damages: Yocom v. Twp. ofUnion, 98 Pa. Super. 540.
We agree with the learned trial judge of the court below that the record does not warrant the entry of judgment non obstante veredicto for the defendant on the merits. The defendant is not obliged to maintain a canal (Haldeman v. Penna. Railroad Co.,50 Pa. 425), but it bought a strip of land with artificial banks, which gather and collect water, which in a natural state would not have flowed there, and it cannot permit this increased quantity of water, thus gathered and collected into an artificial water course, to be discharged in mass or volume through the insertion of a 24-inch pipe or drain at the bottom of the canal or through the non-repair of washouts of the canal bank, onto the plaintiff's land, without responsibility for the resulting damages: Masterson v. Lehigh V.R. Co., 36 Pa. Super. 66;Miller v. Laubach, 47 Pa. 154; Magee v. Penna. S.V.R. Co., 13 Pa. Super. 187; Yocom v. Twp. of Union, supra; Meninchino v.New Castle, 96 Pa. Super. 405. *Page 328
The plaintiff could not object to receiving the water which would naturally come on her land from higher ground, but this did not justify the defendant in collecting water that naturally would have flowed elsewhere and discharging it in mass or volume on plaintiff's land by means of a pipe, two feet in diameter, or through the non-repair of breaks or washouts in the canal bank.
Whatever errors may have occurred on the trial of this case were not chargeable to the trial judge and they furnish no ground for the entry of judgment non obstante veredicto for the defendant.
Judgment affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3855371/ | Argued October 29, 1930.
Catherine G. Rodgers was riding in a Dodge sedan automobile which was being driven by her husband, Louis M. Rodgers. When her car reached a point on the Lincoln Highway, about nine miles west of Chambersburg where a road leads to the south toward *Page 543
Mercersburg, it collided with a car driven by the defendant. In this action to recover damages, the jury found that Louis M. Rodgers was guilty of contributory negligence, and rendered a verdict for Catherine G. Rodgers, upon which judgment was entered in the sum of $1,527.09. It was from that judgment this appeal was taken.
The pivotal point for determination is, whether the contributory negligence of the husband was imputable to the wife.
Negligence of the driver of a car ordinarily will not be imputed to a passenger: Wolf v. Sweeney, 270 Pa. 97. In the recent case of Campagna v. Lyles, 298 Pa. 352, Mr. Justice SADLER, speaking for the court, says, "...... when one is an invited guest, he is ordinarily not chargeable with the negligent acts of the one controlling the machine, and a lack of care on the part of the latter is not to be imputed from the mere fact that he is an occupant of the car."
In most states, including our own, there are two exceptions to this rule: (1) if a passenger controls, or has the right to control, the driver in his operation of the vehicle; (2) if the passenger and driver are engaged in the prosecution of a joint enterprise or adventure at the time of the accident.
The first exception is based on the theory that the driver of a vehicle is regarded as the agent, for whose negligence, within the scope of his authority, the passenger is responsible; and as to the second exception, that a joint enterprise is where a passenger and driver are using a car for the accomplishment of a common object, irrespective of the element of control, or the right of control of the driver. The criterion of the joint enterprise principle is found in the joint use of a vehicle as a means of accomplishing a common purpose: See Vol. 78, University Penna. Law Review, page 747. *Page 544
The learned court below held that the uncontradicted evidence did not support the contention of joint control of the car by the husband and wife. With that view we do not concur. We accede to the proposition advanced that the marital relation alone does not imply agency or joint control, but there was further proof than mere marital relation of the existence of agency between the husband and wife; she was the owner and an occupant of the car. The party consisted of the husband and wife, their two children, and the mother of Mrs. Rodgers. They had left their home in Pittsburgh at 8:30 in the morning with a large amount of baggage and had provided themselves with a lunch. They proceeded east on the Lincoln Highway until they got to the point of the accident, which occurred about 3:30 in the afternoon. Under the testimony of the husband, they expected to drive until about 6:00 or 7:00 o'clock and then stop at Gettysburg. The owner of a car certainly had some voice in the control of her own machine in which she was riding, when on a trip in which she was jointly interested with her husband in the common purpose of reaching their destination. Under such circumstances, the law does not imply a surrender by the wife of all her rights to her husband, nor is she relieved of her legal duties.
In the case of Alperdt et ux. v. Paige, 292 Pa. 1 (6), the husband and wife were injured while riding in an automobile. The wife was considered the guest of her husband but as she failed to exercise reasonable precaution, they were both determined to be guilty of contributory negligence. In the course of that opinion, Mr. Justice SADLER said, "There appears to be little dissent from the proposition that the negligence of the husband is not to be imputed to the wife, unless he is her agent in the matter in hand, or they are jointly engaged in the prosecution of a common enterprise: 20 R.C.L. 151. This general rule has been applied *Page 545
where they were joint occupants of an automobile involved in an accident, as has been decided in practically all of the states where the question has been considered (see note 48 A.L.R. 1077, 1080), including our own: Azinger v. P.R.R. Co., 262 Pa. 242. To charge with contributory negligence on the ground that the party injured was engaged in a joint undertaking, something more must be shown than that the parties were riding together. It must further appear that the passenger had some voice in the control of the vehicle, so as to make it subject to common command, as well as possession: Hoffman v. P. L.E.R.R. Co., 278 Pa. 246; McLaughlin v. P.R.R. Co., 252 Pa. 32. In itself the mere acceptance of an invitation to ride for pleasure does not ordinarily constitute a joint enterprise, because there is no equal right in governing the conduct of the undertaking: Barry v. Harding, 244 Mass. 588, 139 N.E. 298. If, however, both are engaged in a common purpose, and each has the power of direction, the negligence of the driver will prevent recovery by the one accompanying him: Dunlap v. P.R.T. Co., 248 Pa. 130; Martin v. P.R.T. Co., 265 Pa. 282." It will be noted in that case that the husband. not the wife as here, was the owner of the car.
The facts in the case of Prendergast v. Allen, 117 A. 539, are similar to the case at bar. There, the automobile was owned by the wife and her husband was driving. It was determined that the husband was guilty of negligence in an action which she brought against Allen, the driver of the other car. The court said, "Plaintiffs' counsel has referred us to a number of cases in which it has been held that a wife, riding in an automobile driven by her husband, is not chargeable with the husband's negligence in operating said automobile when the wife does not exercise or attempt to exercise any control over such operation. If in this case the negligence of Mr. Prendergast is imputed to *Page 546
his wife, such determination would not be because of the marital relation, but because she was the owner of the automobile; that it was being operated by the husband for the wife in furtherance of a purpose in which she was an interested party, and because from those circumstances the relation of principal and agent would arise between Mrs. Prendergast and her husband. ..... In accordance with the rule of agency applicable with reference to a socalled `family automobile,' the owner is undoubtedly chargeable with the negligence of another member of the family who is driving, if the owner is a passenger, and it is being used for a purpose in the accomplishment of which the owner is interested. In such circumstances the relation of principal and agent arises between the owner and the member of the family driving the machine."
In all the cases relied upon by the appellee in support of her position that the evidence was insufficient to show agency, the proof failed to show ownership of the car by the wife or the evidence established that the car was being used in connection with the husband's business. We are of the opinion that under the undisputed evidence in this case, the relation of principal and agent existed between the husband and wife and that she was chargeable with his negligence.
Furthermore, we have concluded that the facts in this case bring it within the second exception also.
In the case of Koplitz v. St. Paul, 86 Minn. 373, 90 N.W. 794, the Chief Justice, in discussing the doctrine of joint enterprise, said, "If ...... two or more persons unite in the joint prosecution of a common purpose, under such circumstances that each has authority, express or implied, to act for all in respect to the control of the means or agencies employed to execute such common purpose, the negligence of one in the management thereof will be imputed to all the others." *Page 547
This doctrine has been recognized in Campagna v. Lyles, supra, where the supreme court said, "He was engaged in a common enterprise when the collision occurred, and, in determining his right to recover, is not to be considered as an invited guest, with the resulting limited liability for negligent acts of the driver. Where such joint undertaking appears, the occupant of the car is equally barred from the right to recover damages from a third party as would be the employer, if contributory negligence of the latter appears...... Where, however, those riding in the car are engaged in a common purpose of enterprise, they are not to be considered merely guests, but are held equally responsible for the negligent conduct of the driver which produces the injury."
The learned court below was of the opinion that there was no evidence of a joint enterprise as the husband testified: "Q. You had started away on a vacation anyway? Is that right? A. Yes sir." On cross-examination, he was asked, "Q. What was your destination on this trip? A. Atlantic City." The ultimate destination was not of essential importance. At the time of the accident, which controls, the husband and wife were jointly engaged in a common purpose — they were mutually interested in going to Gettysburg; that constituted a joint enterprise.
In view of the foregoing determination of the questions we have discussed, it is unnecessary to consider the question of the alleged personal want of care upon the part of Mrs. Rodgers. A review of all this testimony and a careful consideration of the arguments of able counsel bring us to the conclusion that the wife was chargeable with the husband's negligence.
Judgment is reversed and is hereby entered for the defendant. *Page 548 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3858171/ | Argued April 30, 1934.
Plaintiff is the beneficiary named in an Industrial Life Insurance policy issued by the defendant company upon the life of Ignatz Stefanovich in the amount of $440. Attached thereto was an accidental death *Page 598
benefit rider providing for the payment of an additional amount equal to the face of the policy: "Upon receipt of due proof that the insured ...... has sustained ...... bodily injuries solely through external, violent and accidental means, resulting directly and independently of all other causes, in the death of the insured, ...... No accidental death benefit will be paid ...... if death is caused or contributed to, directly or indirectly or wholly or partially, by disease, or by bodily or mental infirmity."
Upon the death of the insured, on April 18, 1931, defendant paid the face amount of the policy. Alleging that the insured died "from strangulation, due to aspiration of food into the lungs," plaintiff brought the present action to recover the additional amount specified in the rider and agreed to be paid under, and only under, the terms and conditions therein set forth.
Defendant denied that the insured had sustained bodily injuries, "solely through external, violent and accidental means," which had resulted, "directly and independently of all other causes," in his death.
When plaintiff closed her case, the trial judge granted a motion on behalf of defendant to direct a verdict in its favor; plaintiff's subsequent motion for a new trial was denied and she has appealed from the judgment entered upon the verdict.
Policies providing indemnity against injury, or death, caused "solely by external, violent and accidental means," have been construed frequently by appellate courts and the decisions need not here be reviewed. Reference, however, may be made to the opinion of KELLER, J., written for this court in Trau v. Preferred Accid. Ins. Co., 98 Pa. Super. 89, in which will be found a review, analysis and classification of the leading cases, including Eby v. Travelers' *Page 599
Insurance Co., 258 Pa. 525, 102 A. 209, cited by appellant.
Under firmly established principles of law applicable to the issues framed by the pleadings, appellant had the burden of proving, by competent evidence, (a) that the insured's death was caused by external, violent and accidental means, and (b) that it resulted solely from such means, i.e. was not "caused, or contributed to, directly or indirectly or wholly or partially, by disease, or by bodily or mental infirmity."
The only question involved upon this appeal is whether the court below erred in holding that the evidence adduced in her behalf was insufficient to sustain this burden.
These material and undisputed facts appear from the testimony: For several months, insured had been a patient in the City Home and Hospital of the City of Pittsburgh, suffering from an inflammation of his heart and kidneys and the hardening of portions of his spinal column. His legs were paralyzed; he was confined to bed, but able to feed himself. On the day of his death an attendant brought him his lunch, consisting of a stew and bread and milk. Returning later, he noticed there was something wrong with the patient — "kind of restless and shaking himself around, moving his body slightly from side to side." The witness stated the patient had finished eating but had a piece of bread in his hand. Dr. Berger, upon whose testimony appellant chiefly relies, was summoned.
This witness, upon his examination in chief, definitely expressed the opinion that the insured's death was caused solely by strangulation, due to the presence of particles of food in his windpipe and bronchial tubes. Referring to the condition of the patient when he arrived, the doctor testified: "Q. What was his condition when you arrived at his bedside? A. Very bad. Q. And what was he suffering from? A. Well, *Page 600
he could not catch his breath, he was blue and he was comatose. Q. Can you tell us, doctor, what this condition at this time was due to? A. As far as I could determine it was apparently due to particles of food in his bronchi; that is the tubes leading to the lungs. Q. Were you able to do anything for him at that time, doctor? A. I could not do anything."
A portion of his cross-examination reads: "Q. Was he coughing? A. No; not as far as I could see he was not coughing. Q. What examination did you make to discover whether there was anything lodged in the bronchi? A. I tried to look in there as far as I could. I put my finger back as far as I could. Q. Did you find anything there? A. I could not find anything by my examination; no. Q. You found no particles of food in the bronchi, as far as you could detect on your own examination? A. No. ...... Q. Is it your opinion that his death was contributed to in any way by his heart or his kidney condition? A. It is possible, but I can't be absolutely certain that such was the case." Later, upon redirect examination and after examining the records made at the time, the witness modified his testimony to the extent of saying that the insured was coughing when the witness answered the call of the attendant. In another portion of his cross-examination, the doctor, when asked whether he ever discovered any particles of food in the insured's lungs or bronchial tubes, answered, "No, I could not dislodge any at all."
Under the first proposition, above stated, it was not necessary that appellant show the happening of the alleged accident by the direct testimony of eye witnesses: Flaherty v. Scranton Gas Co.,30 Pa. Super. 446; Stewart v. Prudential Ins., Co., 92 Pa. Super. 256; Eby v. Travelers' Insurance Co., supra, and McCullough v. Railway Mail Assn., 225 Pa. 118, 73 A. 1007. *Page 601
Circumstantial evidence of the character adduced in the cases just cited may be sufficient. There is no evidence that a post mortem examination was made, and the opinion of appellant's medical witness is of little probative value until it has been shown that it is supported by proof of some circumstance, such, for instance, as the presence of food (American Acc. Co., of Louisville v. Reigart, 94 Ky. 547, 23 S.W. 191), bristles from a toothbrush (Eby v. Travelers' Ins. Co., supra), or the like, in the patient's windpipe or tubes. In cases of the character of the one with which we are now dealing, we must be able to find upon the record convincing evidence, direct or circumstantial, of the happening of the alleged accident before we may concern ourselves seriously with the opinion of medical experts as to the cause of the insured's death. We are unable to find such evidence in this record.
But even if we could infer that particles of food accidentally lodged in the insured's windpipe, the testimony of the medical expert, through whom appellant spoke, to the effect that he could not be certain whether death was contributed to by the diseases from which the patient was suffering, left that vital question in such doubt that we deem it insufficient to sustain a finding that the patient's bodily infirmities did not contribute to his death. The language of the policy was carefully chosen; it expressly provides that the benefit here involved will not be paid if death was even indirectly or partially contributed to by any disease.
The court below did not err, in our opinion, in holding that appellant had not submitted sufficient evidence to take her case to the jury.
Judgment affirmed. *Page 602 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3855385/ | Argued March 6, 1945.
This is a proceeding to determine the proper basis for distribution of the proceeds of the sale of a property by a municipality under the Act of May 21, 1937, P.L. 787, as amended by the Acts of July 29, 1941, P.L. 600, and May 21, 1943, P.L. 282, 72 P. S. § 5878a et seq. A property in the city of Scranton, owned by and assessed in the name of F.L. Peck, was sold in 1940 at a county treasurer's sale for nonpayment of taxes, and was purchased by the County Commissioners of Lackawanna County. In 1943, after the period of redemption had expired, an offer of $1,000 was made to the county *Page 139
commissioners for the property. A petition was presented to the court of common pleas by the county commissioners asking approval of a proposed compromise and private sale, and setting forth that the unpaid taxes including penalties from 1934 to 1943 aggregated $16,668.72.
The interested taxing authorities are: County of Lackawanna; City of Scranton; Scranton School District; and the Scranton-Dunmore Poor District (later the Lackawanna County Institution District). After notice to them and after hearing, the court approved the compromise, settlement, and private sale, and directed conveyance of the property to the purchaser. Thereafter the county commissioners petitioned the court that the fund be distributed pro rata to the different taxing authorities in accordance with the respective amounts and the respective priorities of the various tax liens. No municipal claims are involved. Specifically they asked that the 1934 county tax, the oldest in priority and senior in lien, should be first paid in full; that the residue should then be applied pro rata to the 1935 county and city taxes, and that the remainder, if any, should be applied pro rata to the 1936 taxes of the city and institution district. In 1934 the owner paid all taxes except the county tax; in 1935 he paid all except the county and city taxes; in 1936 he paid all except the city and institution district taxes. From that time on no taxes were paid whatsoever. The school district filed an answer contending that all taxes should be lumped together regardless of their respective priorities, and that the fund should then be apportioned to the several authorities according to their total unpaid taxes. The distribution suggested by the school district and approved by the court would be approximately as follows, based upon the delinquent taxes outstanding without penalties: *Page 140
Scranton School District ................. $ 402.88 City of Scranton ......................... 402.88 County of Lackawanna ..................... 129.49 Lackawanna County Institution District 64.75 ------ $1,000.00
The county commissioners, who have appealed, contend that the distribution should be as follows:
County of Lackawanna, taxes for 1934 ..... $ 363.87 City of Scranton, account of taxes for 1935 439.34 County of Lackawanna, account of taxes for 1935 ............................... 196.79
Section 4 of the Act of May 21, 1937, P.L. 787, as amended by the Act of July 29, 1941, P.L. 600, § 1, 72 P. S. § 5878d, provides, inter alia, as follows: "The proceeds of such compromise or private sale shall be distributed, first to the costs of sale whereat the property was acquired, and the balance to the respective taxing authorities in proportion to their tax and municipal claims. The title conveyed shall be free and clear of all tax and municipal liens, but shall not discharge any other liens not discharged by the tax sale or sale on municipal claim."
The question involved in the present case is whether under this section of the act priority of lien of a tax claim shall be recognized. In other words, shall the oldest tax having priority be paid first.
We think the words "in proportion to their tax . . . . . . claims" apply not merely to the amounts of the claims but to their respective priorities. Consequently, we agree with the contention of the appellants.
In Erie School District Appeal, 155 Pa. Super. 564,39 A.2d 271, we held that in the distribution of the proceeds of a compromise or private sale under the Act of 1937, as amended, supra, taxes are to be paid in full before municipal liens. We there held (155 Pa. Super. 564, 572, 573, 39 A.2d 271,275) that, "In any event, the intent of the legislature, as expressed by *Page 141
the quoted words of the Act of 1941, 72 P. S. § 5878d, cannot be determined by ignoring other legislation on the subject, which clearly expresses a consistent intent as to the respective priorities, and provides for general uniformity"; and that "we will not place a municipal claim upon an equal basis with a tax claim in the absence of a plain legislative declaration of a change of policy."
It has not only been the legislative intent to regard taxes as liens superior in point of payment to all other liens, but it has likewise been the legislative intent that tax claims be paid out of the proceeds of sale first and according to their priority. See Act of June 4, 1901, P.L. 364, § 32 (repealed and supplied); Municipal Lien Act of May 16, 1923, P.L. 207, § 31, 53 P. S. § 2051; Act of June 26, 1939, P.L. 1100, § 4, 72 P. S. § 5941.4; Erie SchoolDistrict Appeal, supra.
A sale under the Act of 1937, as amended, supra, does not materially differ from sales denominated judicial sales. It is under the control of the court, and it is the power of the court which gives validity to the sale. See City of Uniontown v.McGibbons et al., 115 Pa. Super. 132, 139, 174 A. 912; Cityof New Castle v. John Whaley's Heirs et al., 102 Pa. Super. 492,496, 157 A. 503; sections 3 and 4 of Act of May 21, 1937, P.L. 787, as amended, 72 P. S. § 5878c, 5878d.
Section 4 of the Act of 1937, as amended by the Act of 1941,72 P. S. § 5878d, when construed in connection and in harmony with existing law, and as a part of a general and uniform system of jurisprudence, cannot be given the construction placed upon it by the court below. See Seltzer v. Reading, 151 Pa. Super. 226,230, 30 A.2d 177. To do so would not only create diversity but inequality of distribution. In considering the construction to be given the words of the act, inquiry into the legislative background of tax claims in not only permissible but is of capital importance. From such an examination we gather that there is no room *Page 142
for conflicting inferences as, to the legislative intent. Tax claims are not only prior to all other claims as to distribution, but distribution shall be made in accordance with their respective priorities. We believe there is every reason for giving the words of the act that construction which recognizes legislative intent as to priorities and uniformity, and likewise produce the most equitable result.
It is proper that the county receive its 1934 tax in full, and that the city and county pro rate as to their 1935 taxes. The school district received its 1934, 1935, and 1936 taxes in full. Under the distributive plan for which it contends the school district, having received its 1934, 1935, and 1936 taxes in full, would now receive a substantial share of its 1937 tax, while the county would receive only a fraction of its 1934 tax and nothing on subsequent taxes.
Any one of the taxing authorities had an opportunity to disapprove of the proposed compromise sale. If the price was inadequate protest should have been made. The fact that the school district may not participate in this distribution does not necessarily mean that such a sale is not advantageous to it. Community interest is not circumscribed within such narrow limits.
Appellants held the property as trustees for the benefit of all the taxing authorities which had valid, enforceable claims for unpaid taxes against it, in proportion to their respective interests. See section 10 of the Act of May 29, 1931, P.L. 280, as amended by the Act of June 20, 1939, P.L. 498, § 6, 72 P. S. § 5971j; section 17 of the Act of May 29, 1931, P.L. 280, as amended by the Act of May 21, 1943, P.L. 364, § 1, 72 P. S. § 5971q;Andrews Land Corporation's Appeal, 149 Pa. Super. 212, 214,27 A.2d 700; Erie School District Appeal, supra, 155 Pa. Super. 564,570, 39 A.2d 271.
It is significant that the long recognized principle that the tax oldest in point of lien shall have priority has not been changed by any legislative pronouncement. *Page 143
A change of such policy is not to be inferred merely from the lack of uniformity of phraseology in the expression of legislative declarations relating to the distribution of the proceeds of the sale of property to tax claims when such property is sold under various circumstances. There may be situations where the nature of the ownership and the method of sale of property sold for the nonpayment of taxes would necessarily require distribution of the proceeds on the basis of lien equality. But the present case is not of that type, and, as we view it, it is governed by the general policy which recognizes the respective priorities of tax liens.
The order of the court below is reversed, and the record is remitted to that court, with direction to make distribution in accordance with this opinion. Appellee to pay the cost. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1714353/ | 63 N.W.2d 923 (1954)
DEUR
v.
KELLOGG et al.
No. 48461.
Supreme Court of Iowa.
April 7, 1954.
*924 Hugh J. Tamisiea, Missouri Valley, Roy E. Havens, Logan, for appellant.
Raymond A. Smith, Council Bluffs, A. V. Shotwell, Omaha, Neb., for appellees Margaret W. Kellogg, Raymond A. Smith, and others, administrators of the estate of George A. Kellogg, dec'd.
Jepson & Jepson, Sioux City, for appellee Helen Noyes Lundstrum.
Carl V. Burbridge, Logan, guardian ad litem for all appellees who may be minors, insane or under any legal disability whatsoever, and who may be in the military or naval service of the United States.
SMITH, Justice.
Involved here is a question of heirship requiring a consideration of sections 636.32, 636.39, 636.40 and 636.41, Iowa Code 1950, I.C.A.
George A. Kellogg died intestate and without issue, leaving: his widow, defendant Margaret W. Kellogg; a half-sister, plaintiff Fannie Kellogg Deur; and the three heirs of Elizabeth Kellogg, a former wife who died "in lawful wedlock." The last mentioned three are named in the Record as Helen Noyes Lundstrum, Robert Noyes, and ____ Noyes (Christian name unknown).
Decedent's father was L. H. Kellogg (also father of plaintiff by an earlier marriage) and decedent's mother was Johanna Kellogg, of whom there are no known surviving heirs. Plaintiff's mother was Mary McKivegan Kellogg.
Code section 636.32, I.C.A., after providing that in the absence of issue and after payment of debts and administration expense, the surviving spouse of an "intestate" shall receive $15,000 and one-half of all in excess of that amount, then gives "the other one-half of said excess" to his parents.
Section 636.39 provides: "If one of the parents is dead, the portion which would have gone to such deceased parent shall go to the survivor * * *." And section 636.40 states: "If both parents are dead, the portion which would have fallen to their share by the above rules shall be disposed of in the same manner as if they had outlived the intestate and died in the possession and ownership of the portion thus falling to their share, and so on, through ascending ancestors and their issue."
Section 636.41, under which the trial court determined the present controversy, provides: "If heirs are not thus found, the portion uninherited shall go to the spouse of the intestate * * * and if such intestate has had more than one spouse who either died or survived in lawful wedlock, *925 it shall be equally divided between the one who is living and the heirs of those who are dead * * * such heirs taking by right of representation."
It is conceded here that the defendant widow by virtue of section 636.32, is entitled to one-half of the "excess" remaining after payment of expenses, debts and her $15,000; and that plaintiff, as remaining heir of decedent's father, is entitled to one-half of the other half, or one-fourth, of said "excess." The only dispute is over the remaining one-fourth of said "excess" which would go to the heirs of decedent's mother if any were known. The trial court held it should go, under section 636.41, one-half to defendant widow and the other half to the defendant heirs of Elizabeth, decedent's first wife who "died in lawful wedlock."
The case reaches us by plaintiff's appeal from a ruling on her application for separate adjudication of law points in a suit for partition and to quiet title.
I. Plaintiff's claim is predicated on a construction of Code sections 636.40 and 636.41, I.C.A., which we deem unsound. Her argument runs substantially as follows: Section 636.40 provides that if both parents (of the immediate decedent) are dead, the shares they would have taken, under section 636.32, if living, shall go to their heirs. And the word "intestate" in the phrase "spouse of the intestate" as used in the following section, 636.41, means in this case the immediate intestate's deceased parent whose "heirs are not thus found."
Under that interpretation George's mother, Johanna, would be the "intestate" here and her "portion uninherited" would go to plaintiff, the heir of L. M. Kellogg, the spouse who survived Johanna "in lawful wedlock."
Thus plaintiff, concededly entitled to the share that would have gone to her own and George's father had he survived his son, claims also the share that would have gone to George's mother Johanna (plaintiff's stepmother) had she, Johanna survived her son.
We think this construction violates the plain intent of the language of the pertinent code sections. The best clue to its intended meaning is perhaps the way the word "intestate" is used throughout other parts of the statute. See Brown v. Darden, 121 Tex. 495, 50 S.W.2d 261, 263; Betz v. Horr, 276 N.Y. 83, 11 N.E.2d 548, 550, 114 A.L.R. 491; U. S. v. Cooper Corp., 312 U.S. 600, 606-607, 61 S. Ct. 742, 744-745, 85 L. Ed. 1071. In section 636.32 the immediate decedent, devolution of the title of whose property is the primary subject of inquiry, is distinctly referred to as "the intestate." Section 636.39 again speaks of "the intestate's spouse" clearly meaning the surviving spouse of the immediate decedent. Section 636.40, with equal clarity of meaning, refers to the parents of "the intestate." Even the opening words of section 636.41 itself indicate unmistakably a search for heirs of the immediate "intestate" and provide that if, under preceding statutes they are not found, "the portion uninherited shall go to the spouse of the intestate"clearly the intestate whose heirs are being sought.
Plaintiff argues earnestly for a construction that recognizes the "fundamental principle" of keeping the devolution of a decedent's property in his "closest blood line," the design of the statutes being to trace "inheritable blood": "It is only when no `inheritable blood' can be found, that the provisions of section 636.41 are made applicable to the spouse of the immediate intestate. In such case, the blood lines having become extinct, the property `uninherited' which would otherwise have escheated, due to the failure of such blood lines, passes to the spouse of the immediate intestate, or is divided between such spouse and the heirs of a predeceased spouse of such immediate intestate."
This argument seems to require an elastic interpretation of the word "intestate" as it appears in section 636.41. After the fruitless search for "inheritable blood" has been made through sections 636.32, 636.39 and 636.40, "in order of priority," according to plaintiff, we come to the opening words of section 636.41: "If heirs are not *926 thus found". Plaintiff would interpret these words to mean "if inheritable blood is not thus found." Then and only then, it is contended, will the word "intestate" in section 636.41 be held to mean the immediate decedent.
Unfortunately for this argument the legislature did not say "if inheritable blood is not thus found"as it could so easily have said had it so meant. It seems more probable the lawmakers were prescribing rules for the devolution of title of intestate property in order to avoid escheat. In re Estate of Tripp, 239 Iowa 1370, 35 N.W.2d 20.
Plaintiff's interpretation would not lead invariably to "inheritable blood" though of course applying it here would do so since George A. Kellogg's mother, Johanna, who would be the "intestate," never had any spouse but George's father whose sole heir is plaintiff.
But suppose Johanna had had an earlier spouse who predeceased her "in lawful wedlock" and whose living heirs by an earlier marriage were known. Those "alien" heirs would, under plaintiff's theory, share with plaintiff as heirs of Johanna. Or suppose plaintiff did not exist. Those heirs would take Johanna's entire portion of her son's estate though entirely outside her own and her son's "blood line."
We think the clear meaning of the word "intestate" in the phrase "spouse of the intestate" in Code section 636.41, I.C.A., is the decedent, devolution of whose property is the subject of the inquiry.
II. It must be conceded some language in In re Estate of Tripp, 239 Iowa 1370, 1374, 35 N.W.2d 20, lends support to plaintiff's contention. We were there considering a case in which the immediate decedent was unmarried and no spouse survived or predeceased him "in lawful wedlock". The choice confronting the court was between possible "inheritable blood" and escheat.
We pointed out this distinction in Ramsay v. All Unknown Claimants, 241 Iowa 715, 718, 42 N.W.2d 386, in which the controversy was between the immediate decedent's surviving spouse and the heirs of his predeceased first spouse on the one hand; and on the other hand the known heirs of his predeceased mother. We held, in effect that the surviving widow, and the heirs of the predeceased spouse, of J. J. Ramsay, the immediate decedent or intestate, were entitled, under Code section 636.41, I.C.A., to the one-fourth share that would have gone to his unrecognized natural father, or the heirs of such father, had there been mutual recognition under Code section 636.46, I.C. A.
In no case, under Code section 636.41, I.C.A. have we denied the right of the immediate intestate's spouse to the "portion uninherited" in favor of the spouse of the deceased parent whose heirs were unknown.
McAllister v. McAllister, 183 Iowa 245, 167 N.W. 78, 81, has been mistakenly assumed to be such a case. The confusion has arisen perhaps because it was a partition suit involving the property of Charles McAllister, the father of the immediate "intestate," Alexander McAllister, devolution of whose property was the immediate concern of the court.
The father, Charles, devised one-half of of his estate to Alexander, who predeceased him, leaving a widow but no issue. The devise did not lapse however (due to the antilapse statute, now section 633.16). Alexander's mother's heirs were unknown. We held Alexander was the "intestate" and his widow was "spouse of the intestate" under the pertinent code section (now 636.41). The opinion says:
"Heirs of the mother (of Alexander), not having been found, the widow of the intestatei.e., the predeceased deviseetook under this statute the portion which would have gone to the mother * * * had she survived the devisee. * * * By `spouse of the intestate' is meant spouse of the person whose heirs are sought to be ascertained as entitled to the property in probate." 183 Iowa 255, 167 N.W. 81.
*927 In the Ramsay case, supra, 241 Iowa at page 718, 24 N.W.2d at page 388, we said with equal certainty: "If heirs of the intestate `are not thus found' the search for heirs to the `portion uninherited' starts anew with the lines of intestate's wives. * * * The spouse and heirs of the deceased spouse of the intestate take direct from the intestate and not as heirs of intestate's father or any third person." We think that must be our answer to this appeal.
The instant case was argued on both sides with signal ability and precision of language. The exact nature of the contention of the respective parties is not left in doubt. The trial court correctly decided the issue and the case should be and is affirmed.
Affirmed.
BLISS, C. J., and OLIVER, LARSON, GARFIELD, MULRONEY, WENNERSTRUM and THOMPSON, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3398081/ | Appeal dismissed on motion of counsel for Appellant. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3856403/ | William F. Miller was indicted in the court of quarter sessions of Erie County for sodomy. The indictment contained two counts. He was convicted *Page 333
generally and sentenced on May 15, 1915 to an indefinite term in the Western Penitentiary, with a maximum of twenty years and a minimum of fifteen years. See Act of June 19, 1911, P.L. 1055, sec. 6, then in force.
In this petition for writ of habeas corpus he contends that the sentence so imposed was illegal and void for two reasons: (1) That the two counts grew out of the same transaction and were committed at the same time, and constituted, in effect, one and the same offense, warranting the imposition of but one sentence: Com. ex rel. Holinko v. Ashe, 290 Pa. 534, 139 A. 197; (2) that the court did not sentence him on each count and direct that the sentence on the second count should begin upon the expiration of the first, but imposed in one sentence the cumulative maximum and minimum: Halderman's Petition, 276 Pa. 1, 119 A. 735. The Act of Assembly then in force was section 32 of the Criminal Code (March 31, 1860, P.L. 382), which fixed the maximum imprisonment at ten years, by separate and solitary confinement at labor.
The first contention of the relator is without merit. An examination of the indictment shows that each count charged a separate and distinct method of unnatural intercourse. Though committed on the same day they were separate and distinct crimes, each justifying a separate and distinct sentence: Com. v. Birdsall, 69 Pa. 482.
(2) The second contention must be sustained. While the court might have legally sentenced the prisoner to a maximum term of ten years and a minimum of seven and a half years on the first count, and a maximum of ten years and a minimum of seven and a half years on the second count, and directed that the sentence on the second count should begin at the expiration of the first, it did not do so. It lumped the *Page 334
sentences into one, with a maximum of twenty years and a minimum of fifteen. This was illegal: Halderman's Petition, supra, p. 4. The sentence is not void but voidable: Halderman's Case, 53 Pa. Super. 554. If the court had sentenced the prisoner on each count, but had not directed the sentences to be cumulative, they would have run concurrently: Halderman's Petition, supra, p. 4; and after the term the court could not alter the sentence by directing that the imprisonment be cumulative: Id. p. 4. It follows that the maximum sentence that could now be imposed on the relator in the event of resentence would be ten years, and as that has expired, we are of opinion that we are not obliged to remand for resentence but may make the necessary change as authorized in Halderman's Petition, supra, and Com. v. Leib, Supreme Court, 116 Misc. Docket No. 4, (276 Pa. 5). The sentence will accordingly be amended as of the date of its imposition by changing the maximum term from twenty years to ten years and the minimum from fifteen years to seven and one-half years.
This would require the discharge of the relator, for he has already served the maximum term of ten years, were it not for the fact that at the time he committed the offenses charged in the indictment in this case, he was on parole from the Western Penitentiary for prior sentences amounting to 29 years, on conviction for several charges of rape, and when he was returned to the penitentiary there remained an unserved portion thereof of eighteen years, six months and eighteen days, which under section 10 of the Act of June 19, 1911, P.L. 1055, then in force, he was required to serve after the expiration of the term for which he was sentenced under the indictment for sodomy, in this case. The detainer and remand under the Act of June 19, 1911, supra, will take effect as of May 15, 1925, the date of the expiration of the maximum sentence of *Page 335
ten years for sodomy, which had been completed when the petition for the writ of habeas corpus was filed.
The rule to show cause is, except as above stated, discharged. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4554008/ | United States Court of Appeals
For the Eighth Circuit
___________________________
No. 19-3633
___________________________
Aaron Anthony Flemons
lllllllllllllllllllllPlaintiff - Appellant
v.
Glenda Bolden, Security Officer, EARU, ADC (originally named as Bolden);
Daryl Morris, Security Officer, EARU, ADC (originally named as Morris)
lllllllllllllllllllllDefendants - Appellees
Arkansas Department of Correction
lllllllllllllllllllllDefendant
Wendy Kelley, Director, Arkansas Department of Correction
lllllllllllllllllllllDefendant - Appellee
David Knott, Chief of Security, EARU, ADC (originally named as Knott);
Synitreous Rose, Security Officer, EARU, ADC (originally named as Rose)
lllllllllllllllllllllDefendants
Keith L. Waddle; Daniel Wayne Golden, originally named as Golden
lllllllllllllllllllllDefendants - Appellees
____________
Appeal from United States District Court
for the Eastern District of Arkansas - Pine Bluff
____________
Submitted: August 3, 2020
Filed: August 7, 2020
[Unpublished]
____________
Before COLLOTON, GRUENDER, and GRASZ, Circuit Judges.
____________
PER CURIAM.
Aaron Flemons appeals the district court’s1 adverse grant of summary judgment
in his pro se 42 U.S.C. § 1983 action related to prison disciplinary proceedings. After
careful review of the record and the parties’ arguments on appeal, we conclude that
summary judgment was proper. See Hartsfield v. Nichols, 511 F.3d 826, 829 (8th Cir.
2008) (reviewing grant of summary judgment de novo). Accordingly, we affirm. See
8th Cir. R. 47B.
______________________________
1
The Honorable D.P. Marshall Jr., Chief Judge, United States District Court for
the Eastern District of Arkansas, adopting the report and recommendations of the
Honorable Joe J. Volpe, United States Magistrate Judge for the Eastern District of
Arkansas.
-2- | 01-03-2023 | 08-07-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/151330/ | Case: 09-40169 Document: 00511181938 Page: 1 Date Filed: 07/22/2010
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
July 22, 2010
No. 09-40169
Summary Calendar Lyle W. Cayce
Clerk
UNITED STATES OF AMERICA,
Plaintiff-Appellee
v.
REGINALD STANLY STROTHER,
Defendant-Appellant
Appeal from the United States District Court
for the Eastern District of Louisiana
USDC No. 1:06-CR-182-1
Before JONES, Chief Judge, and DAVIS and WIENER, Circuit Judges.
PER CURIAM:*
Reginald Stanly Strother has appealed pro se from his conviction of
possession with intent to distribute 50 grams or more of cocaine base, a violation
of 21 U.S.C. § 841(a). Strother’s motions for leave to file a supplemental brief
and a reply brief are GRANTED. Strother complains that he was not provided
with copies of “the docket sheet, pre-trial motions filed with this court, the actual
suppression hearing minutes and etc.” Although this contention may be
construed as a motion to supplement the record, the motion is DENIED, as
*
Pursuant to 5TH CIR . R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR .
R. 47.5.4.
Case: 09-40169 Document: 00511181938 Page: 2 Date Filed: 07/22/2010
No. 09-40169
Strother does not state with sufficient specificity what portions of the record
were not provided to him or how the absence of those documents impaired his
ability to present his issues on appeal.
After Strother’s case was tried before a jury, Strother moved for a new
trial and his motion was granted. Strother contends, in relation to the first trial,
that he received ineffective assistance of counsel because one of his attorneys
labored under a conflict of interest by representing a Government witness and
that his right to due process was violated because of prosecutorial misconduct
related to that witness’s testimony. This claim is moot because Strother was
granted a new trial. Strother contends also that his right against double
jeopardy was violated because his retrial was the product of prosecutorial
misconduct. Strother has not shown and the record does not reflect that the
prosecutor intended to provoke a mistrial. See Oregon v. Kentucky, 456 U.S. 667,
679 (1982).
Strother contends for the first time in his reply brief that the district court
erred in denying his first motion to suppress. Strother contended that the
cocaine base found during a search of his vehicle and any of his statements about
the offense or giving consent to search should be suppressed. The drugs were
found during a search of Strother’s vehicle as part of a valid traffic stop. The
record reflects that Strother gave consent to the search while the police officers
were waiting for a reasonable period of time for a return on a record check and
that the consent was not the product of coercion or improper questioning. See
United States v. Santiago, 310 F.3d 336, 341 (5th Cir. 2002). Strother has not
shown that this court should set aside its usual rule against considering issues
that were not raised in an appellant’s original brief. See United States v. Ogle,
415 F.3d 382, 383-84 (5th Cir. 2005).
Strother contends that the district court erred in denying his second
motion to suppress, in which Strother contended that his post-arrest statements
should be suppressed because the arresting officer failed to admonish him of his
2
Case: 09-40169 Document: 00511181938 Page: 3 Date Filed: 07/22/2010
No. 09-40169
constitutional rights in accordance with Miranda v. Arizona, 384 U.S. 436, 479
(1966). The district court’s finding that the arresting officer gave Strother the
complete Miranda warning was not clearly erroneous. See United States v.
Waldrop, 404 F.3d 365, 367-68 (5th Cir. 2005); see also Florida v. Powell, 130
S. Ct. 1195, 1204 (2010); Miranda, 384 U.S. at 479.
Strother complains that his post-arrest confession that the drugs were his
was “the product of police threats and coercion” and that the district court erred
in admitting evidence of the confession. Strother contends that the arresting
officer threatened to charge his girlfriend and mother with possessing the
cocaine base and that he confessed in order to protect them from prosecution.
Because Strother did not object at trial to admission of the evidence, we
review the question whether the district court erred in permitting the arresting
officer to testify about Strother’s confession for plain error. See United States v.
Rogers, 126 F.3d 655, 657 (5th Cir. 1997). To show plain error, Strother must
show a forfeited error that is clear or obvious and that affects his substantial
rights. See Puckett v. United States, 129 S. Ct. 1423, 1429 (2009). If Strother
makes such a showing, this court has the discretion to correct the error but only
if it seriously affects the fairness, integrity, or public reputation of judicial
proceedings. See id.
The record reflects that, after Strother was given his Miranda warnings,
he waived his right to remain silent by continuing to speak with the arresting
officer. See Soffar v. Cockrell, 300 F.3d 588, 593 (5th Cir. 2002). The evidence
does not show that the arresting officer overreached. See Colorado v. Connelly,
479 U.S. 157, 170 (1986); United States v. Guanespen-Portillo, 514 F.3d 393, 403
(5th Cir. 2008). The district court did not plainly err in failing to suppress
evidence of the confession. See Puckett, 129 S. Ct. at 1429.
Strother contends that the district court erred in denying his motion for
a new trial following the retrial, in which Strother argued that the prosecutor
had violated his right to due process by encouraging his girlfriend, whom he
3
Case: 09-40169 Document: 00511181938 Page: 4 Date Filed: 07/22/2010
No. 09-40169
intended to call as a witness, to invoke her right against self incrimination. We
review the denial of a motion for a new trial for an abuse of discretion. United
States v. Jimenez, 509 F.3d 682, 691 (5th Cir. 2007).
The record reflects that the witness overheard the prosecuting attorney
advise the witness’s attorney that she was at risk of being prosecuted for perjury
or for possession of the drugs if she elected to testify. “A prosecutor is always
entitled to attempt to avert perjury and to punish criminal conduct.” United
States v. Viera, 839 F.2d 1113, 1114-15 (5th Cir. 1988) (en banc) (quote at 1115).
Thus, it was not improper for the prosecuting attorney to seek to prevent the
introduction of testimony that he reasonably believed would be untruthful. See
id. Moreover, Strother has not shown that the witness’s testimony would have
been material or exculpatory and the evidence of Strother’s guilt was
overwhelming. See id. at 1115. Thus, Strother cannot show that he was
deprived of a fair trial because of the prosecuting attorney’s conduct. See United
States v. Hernandez-Guevara, 162 F.3d 863, 874 (5th Cir. 1998). The district
court did not abuse its discretion in denying the motion for a new trial. See
Jimenez, 509 F.3d at 691.
Strother contends that the district court erred in denying his motion to
dismiss the indictment, in which he challenged the district court’s jurisdiction,
arguing that Title 21 of the United States Code has never been enacted into
positive law. Strother argues that Title 21 was not an “Act of Congress” because
it is not “included in the Statutes at Large and published in the Federal
Register.” Strother contends also that the district court lacked jurisdiction
because the State of Texas is not a federal territory and because the state did not
legally cede constitutional legislative jurisdiction to the federal government.
These contentions are specious. See Gonzales v. Oregon, 546 U.S. 243, 249
(2006) (discussing enactment of the Controlled Substances Act (CSA)); Gonzales
v. Raich, 545 U.S. 1, 12-13 (2005) (discussing Congress’ enactment of the CSA
pursuant to its authority under the Commerce Clause); see also U.S. C ONST. A RT.
4
Case: 09-40169 Document: 00511181938 Page: 5 Date Filed: 07/22/2010
No. 09-40169
I § 8, cl. 17 (cited by Strother, pertaining to the creation and exercise of
congressional authority over the District of Columbia).
Strother contends in his reply brief that the district court failed to comply
with F ED. R. C RIM. P. 32(i)(1)(A). Strother has not shown that his substantial
rights were affected by any error on the part of the district court in determining
whether he had an adequate opportunity to read and discuss the presentence
report with his attorney. See F ED. R. C RIM. P. 52(a) (harmless error standard).
Moreover, Strother has not shown that this court should set aside its usual rule
against considering issues that were not raised in an appellant’s original brief.
See Ogle, 415 F.3d at 383-84. To the extent that Strother wishes to assert a
claim of ineffective assistance of counsel related to the district court’s
noncompliance with Rule 32(i)(1)(A), we decline to consider it at this juncture.
See Gulley, 526 F.3d at 821. The judgment is
AFFIRMED.
5 | 01-03-2023 | 07-22-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3978883/ | Appellants caused a writ of garnishment to be issued against appellee during a term of the District Court of Wise County, returnable to the next succeeding term, as provided by statute. This writ was promptly served on appellee, which was a private corporation in which the wife of C. D. Cates owned shares of stock, the purpose of the garnishment being to sequester the dividend due or to become due on these shares of stock and to appropriate the same to the payment of a judgment in favor of the appellants against C. D. Cates. Appellee promptly filed its answer, denying liability, whereupon the district judge certified his disqualification to the Governor and the judge of an adjoining district was commissioned to try the case. It seems that he had also been commissioned to try another case in the same court, and that just after it had been disposed of this case was called for trial, whereupon the attorney who had caused the writ *Page 611
to be sued out and who happened to be in the courthouse attending as a spectator the trial just concluded, called the court's attention to the fact that the garnishment suit was not triable at that term of court, but only at the succeeding term, to which the writ of garnishment was returnable, and objected to a trial at that time; but the court took a different view of the law, holding that as all parties were present in the court the trial should proceed. In this we think there was error, since we know of no authority for such a proceeding. The court was not warranted in the assumption that all parties were before the court merely because the attorney had caused the writ to be sued out in behalf of appellants chanced to be present in the courtroom as a spectator. Indeed, if the appellants themselves had been there in person, they could not have been required to then try a suit which they had brought to a subsequent term of the court. It seems to have been the purpose of the garnishee and other parties interested in preventing the collection of appellants' debt to have a trial before the time had come to declare the dividend. But whatever may have been their purpose the court had no power to take up the case and try it at a term prior to the one to which the process was returnable, over the objections of the party bringing the suit.
The judgment is therefore reversed and the cause remanded for further proceedings.
Reversed and remanded. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/152488/ | 613 F.3d 1093 (2010)
UNITED STATES of America, Plaintiff-Appellee,
v.
Azim Waleed EPPS, Defendant-Appellant.
No. 09-12285.
United States Court of Appeals, Eleventh Circuit.
August 6, 2010.
*1095 Jeffrey Lyn Ertel, Stephanie Kearns, Fed. Pub. Defenders, Fed. Public Defender Program, Inc., Atlanta, GA, for Defendant-Appellant.
Thomas Aloysius Devlin, Jr., Lawrence R. Sommerfeld, Atlanta, GA, Timothy J. Storino, Tampa, FL, for Plaintiff-appellee.
Before DUBINA, Chief Judge, PRYOR and MARTIN, Circuit Judges.
MARTIN, Circuit Judge:
Azim Waleed Epps ("Mr. Epps") appeals his convictions and sentence for armed bank robbery in violation of 18 U.S.C. § 2113(a), (d), and carrying a firearm in relation to a crime of violence in violation of 18 U.S.C. § 924(c)(1)(A)(ii). He contends that the district court erred in denying his motion to suppress evidence and also that the government improperly vouched for a witness's credibility during closing argument.[1] After reading the parties' briefs, reviewing the record, and having the benefit of oral argument, we affirm.
*1096 I.
On August 11, 2006, an African-American man with dreadlocks entered the Gainesville Bank and Trust. He approached a teller and said, "This is a robbery, give me your money." As the teller was gathering the money, he told her to hurry up and not to make him pull his gun. Both the first teller and an adjacent teller gave the robber money and dye packs, which he placed into a black bag.
In a parking lot near the bank, a woman was approaching her car. An African-American man with braided hair demanded her car keys, whereupon she hit him with the magazine she had in her hand. The would-be carjacker then went over to an 83-year-old man sitting in his blue Chevrolet Cavalier, pulled the elderly man out of the car and onto the pavement, and drove off.
Deputy Paul Kent was responding to the bank robbery when he heard a report about a blue Cavalier being carjacked. There were a number of police cars present when he arrived at the scene of the carjacking, so he instead proceeded across the street in the direction of a shopping mall. As he was approaching the mall, he noticed a blue Cavalier parked at an angle next to a pawnshop, with its driver's door open. He continued toward the mall, and he saw a man running quickly through the mall parking lot with a white bag in his hand. The path that the runner was taking led away from the Cavalier toward the mall entrance. Deputy Kent, who had his lights and siren going, used his car's P.A. system two or three times to announce his presence and order the individual to stop. The fleeing individual looked back over his shoulder at the police car and pointed a gun in the deputy's direction, while continuing to run. A bystander in the mall parking lot also saw the gun being pointed at the officer. At this point, the runner was approximately ten feet in front of the police car. Deputy Kent then attempted to stop the man by hitting him with the front right corner of the patrol car. The man rolled off the car's hood and landed on the ground. Both the gun and the white bag went flying, as well as another object later determined to be a pocket knife. Deputy Kent got out of his car and covered the suspect with his firearm until another officer arrived and handcuffed the individual. The man arrested turned out to be Mr. Epps.
Mr. Epps was already in custody by the time Investigator Margaret Dawson arrived to process the scene. She took photographs of the gun, knife, and white bag where they came to rest on the ground near the patrol car. The white bag was a pillowcase, with pink stains on it. The pillowcase was later moved to the back of a police vehicle, where the police opened it and found the following items: currency that was partially burned and marked with red dye; two dye packs; a dreadlock wig; a black bag; a shirt; and a can of pepper spray.
Mr. Epps was taken to a nearby hospital for treatment of his abrasions. He informed the police that he wanted to speak with the lead investigator and was interviewed by FBI Agent Joseph Thompson approximately three hours after the bank robbery took place. Agent Thompson advised Mr. Epps of his rights to remain silent and to consult with an attorney. Mr. Epps signed a waiver of rights form, which was also signed by Agent Thompson and by a witness, Investigator Kevin Gaddis of the Gainesville Police Department. Mr. Epps then confessed to the bank robbery, carjackings, and attempt to flee from the police, although Mr. Epps denied pointing his gun at Deputy Kent.
After being indicted, Mr. Epps filed a motion to suppress the evidence found in *1097 the pillowcase. Deputy Kent and Investigator Dawson testified at an evidentiary hearing. The magistrate judge subsequently recommended that the motion to suppress be denied, a recommendation that the district judge approved and adopted over Mr. Epps's objections.
Mr. Epps's jury trial began on December 8, 2008. The government's witnesses included the bank tellers, the carjacking victims, and various law enforcement officers. Agent Thompson testified about the confession that Mr. Epps gave shortly after being arrested. Investigator Gaddis was not called as a witness by either party.
During closing argument, defense counsel suggested that Agent Thompson had fabricated the confession:
Ask yourself something: Why in the world would somebody let an agent know that, hey, I want to talk to you and then I want to give a full confession? There is no testimony about any promises. There was no testimony that he was going to get any benefit. Why in the world would he do that? That doesn't make sense. That type of thing is reason to doubt. It's reason to doubt whether that statement was given.
In rebuttal, the prosecutor told the jury, "Defense specifically argued to you there'sthat what Agent Thompson testified to, he said that's not what the defendant said. I'm going to say it again: Agent Thompson wasn't the only other person in the room. There was somebody else there." Mr. Epps objected and moved for a mistrial. The district court denied the motion, but instructed the jury that the defense had no burden to present any kind of evidence and that the burden of proof was entirely on the government.
The jury found Mr. Epps guilty on all counts, and the district court sentenced him to 360 months imprisonment. Mr. Epps timely appealed.
II.
Mr. Epps contends that the district court erred in denying his motion to suppress evidence. Specifically, he argues that the police did not have authority to conduct a warrantless search of the pillowcase he was carrying. He also maintains that Deputy Kent did not have a lawful justification for stopping him, and that everything obtained from his unlawful detention must therefore be suppressed as the fruit of the poisonous tree.
"In an appeal of the district court's denial of a defendant's motion to suppress, we review the district court's findings of fact for clear error and its application of the law to those facts de novo." United States v. Luna-Encinas, 603 F.3d 876, 880 (11th Cir.2010). When reviewing the denial of a motion to suppress, this Court is not restricted to the evidence presented at the suppression hearing and instead considers the whole record. United States v. Newsome, 475 F.3d 1221, 1224 (11th Cir.2007).
The Fourth Amendment to the United States Constitution prohibits "unreasonable searches and seizures." U.S. Const. Amend. IV. However, "only individuals who have a legitimate expectation of privacy in the area invaded may invoke the protections of the Fourth Amendment." United States v. Lee, 586 F.3d 859, 864 (11th Cir.2009). "`The party alleging an unconstitutional search must establish both a subjective and an objective expectation of privacy.'" United States v. King, 509 F.3d 1338, 1341 (11th Cir.2007) (quoting United States v. Segura-Baltazar, 448 F.3d 1281, 1286 (11th Cir.2006)). "`The subjective component requires that a person exhibit an actual expectation of privacy, while the objective component requires that the privacy expectation be one *1098 that society is prepared to recognize as reasonable.'" Id. (quoting Segura-Baltazar, 448 F.3d at 1286).
Mr. Epps manifested his subjective expectation of privacy by placing personal items inside the pillowcase and holding it shut in one hand. The fact that the pillowcase could not be fastened is not dispositive. The Supreme Court has recognized that "a traveler who carries a toothbrush and a few articles of clothing in a paper bag or knotted scarf [may] claim an equal right to conceal his possessions from official inspection as the sophisticated executive with the locked attaché case." United States v. Ross, 456 U.S. 798, 822, 102 S.Ct. 2157, 2171, 72 L.Ed.2d 572 (1982).
Where Mr. Epps's argument founders is on the objective component, because society is not willing to accept that his subjective privacy expectation was objectively reasonable. The Supreme Court has suggested in dictum that "some containers (for example a kit of burglar tools or a gun case) by their very nature cannot support any reasonable expectation of privacy because their contents can be inferred from their outward appearance." Arkansas v. Sanders, 442 U.S. 753, 764 n. 13, 99 S.Ct. 2586, 2593 n. 13, 61 L.Ed.2d 235 (1979), overruled on other grounds by California v. Acevedo, 500 U.S. 565, 579, 111 S.Ct. 1982, 1991, 114 L.Ed.2d 619 (1991).[2]
This Court, applying Sanders, has found permissible warrantless searches where the container itself and the circumstances under which the police obtained it indicate that the contents are contraband. For example, we have upheld a warrantless search of closed, opaque packages that reeked of marijuana. United States v. Lueck, 678 F.2d 895, 903 (11th Cir.1982). We have also upheld the warrantless search of a paper sack lying in full view on the floor of a car, where the paper sack was labeled as being from a pharmacy suspected of involvement in illicit activities and the sack's "contents could be inferred from the [observing police officers'] first hand knowledge that it had been brought directly from the pharmacy under unusual circumstances." United States v. Sutton, 636 F.2d 96, 99-100 (5th Cir. Unit A Feb. 1981).[3] But we have found a Fourth Amendment violation where the police conducted a warrantless search of a zippered case and found a gun inside. United States v. Rigales, 630 F.2d 364, 368 (5th Cir.1980). The fact that the case contained a gun could not be inferred from its outward appearance: although the officer testified that the case was heavy and had a *1099 bulge in the middle, there was no evidence indicating that the bulge was in the shape of a pistol or demonstrating that "the zippered case was anything other than an ordinary briefcase that was simply heavy and bulging." Id.
In this case, considering the totality of the circumstances, the fact that the pillowcase contained dye packs and possibly other items associated with the bank robbery could "be inferred from [its] outward appearance." Sanders, 442 U.S. at 764 n. 13, 99 S.Ct. at 2593 n. 13; see also United States v. Williams, 41 F.3d 192, 197 (4th Cir.1994) ("[T]he circumstances under which an officer finds the container may add to the apparent nature of its contents."). Deputy Kent saw Mr. Epps with a white bag in his hand, running away from a blue Cavalier parked at an angle with its driver's door open. The deputy knew that a blue Cavalier had been carjacked, and he believed that the carjacking was related to a bank robbery that had taken place in the same area just minutes before. After being directed to stop, the fleeing individual pointed a gun at the deputy. Upon closer inspection, the white bag was found to be a pillowcase with pink stains on it. Tellers frequently give bank robbers dye packs, which are designed to explode after the robbery and permanently mark the bills with ink. See United States v. King, 842 F.2d 311, 312 (11th Cir.1988) ("Although [Officer] Morton was not aware of the ... robbery, he knew that bank tellers frequently insert red dye bombs in packages during bank robberies."); United States v. Gidley, 527 F.2d 1345, 1348 & n. 1 (5th Cir.1976) (discussing detective's awareness that "dye stained money often is a result of the explosion of a dye bomb planted during a bank robbery," and finding it "unlikely" that "the other officers were unaware of the significance of stained money").
Because the pillowcase's contents could be inferred from its outwardly visible stains and the circumstances under which the police obtained it, the pillowcase was one of those containers that "by [its] very nature cannot support any reasonable expectation of privacy." Sanders, 442 U.S. at 764 n. 13, 99 S.Ct. at 2593 n. 13. The pillowcase therefore fell outside the protective ambit of the Fourth Amendment, and the police did not violate Mr. Epps's constitutional rights when they opened the pillowcase without first obtaining a warrant.
Mr. Epps's other Fourth Amendment argument also fails. He contends that Deputy Kent's sole basis for seizing him was impermissible racial discrimination, and that the fruit of the poisonous tree doctrine therefore requires suppression of the gun, knife, and pillowcase seized after his unlawful detention. We are not persuaded.
It is true that "[e]vidence seized after an illegal seizure should be suppressed as the `fruit of the poisonous tree.'" United States v. Davis, 313 F.3d 1300, 1302 (11th Cir.2002). However, "the Fourth Amendment permits warrantless arrests in public places where an officer has probable cause to believe that a felony has occurred." Florida v. White, 526 U.S. 559, 565, 119 S.Ct. 1555, 1559, 143 L.Ed.2d 748 (1999). After announcing his presence and directing Mr. Epps to stop, Deputy Kent saw Mr. Epps pointing a pistol at him from about ten feet away, which made the officer fear for his own safety. A bystander in the mall parking lot corroborated the deputy's testimony about the pointing of the weapon. Deputy Kent thus had probable cause to believe that Mr. Epps had committed the felonies of aggravated assault and aggravated assault upon a peace officer. See O.C.G.A. § 16-5-21(a)(2) (defining aggravated assault as an *1100 assault "[w]ith a deadly weapon or with any object, device, or instrument which, when used offensively against a person, is likely to or actually does result in serious bodily injury"); id. § 16-5-21(c) ("A person who knowingly commits the offense of aggravated assault upon a peace officer while the peace officer is engaged in, or on account of the performance of, his or her official duties shall, upon conviction thereof, be punished by imprisonment for not less than five nor more than 20 years."). The deputy's subsequent detention of Mr. Epps was a lawful warrantless seizure, which means that none of the evidence obtained from the seizure was tainted. See United States v. Lopez-Garcia, 565 F.3d 1306, 1315 (11th Cir.2009) (holding that, because the defendant's seizure and arrest were constitutional, "neither of his subsequent statements was tainted by those events" and his "Fourth Amendment fruit of the poisonous tree argument plainly collapses"). The district court properly rejected Mr. Epps's argument that the gun, knife, and pillowcase should be suppressed as the fruits of an illegal seizure.
III.
Mr. Epps also raises a prosecutorial misconduct claim. Specifically, he argues that the government impermissibly vouched for Agent Thompson's credibility because the prosecutor suggested during closing argument that an uncalled witness could have corroborated Agent Thompson's testimony.
"The Court reviews a prosecutorial misconduct claim de novo because it is a mixed question of law and fact." United States v. Eckhardt, 466 F.3d 938, 947 (11th Cir.2006). "To find prosecutorial misconduct, a two-pronged test must be met: (1) the remarks must be improper, and (2) the remarks must prejudicially affect the substantial rights of the defendant." United States v. Eyster, 948 F.2d 1196, 1206 (11th Cir.1991). Improper vouching occurs in two different circumstances: (1) if the prosecutor "place[s] the prestige of the government behind the witness, by making explicit personal assurances of the witness' veracity," or (2) if the prosecutor "implicitly vouch[es] for the witness' veracity by indicating that information not presented to the jury supports the testimony." United States v. Sims, 719 F.2d 375, 377 (11th Cir. 1983).
Although Mr. Epps does not contend that the prosecutor expressly vouched for Agent Thompson's credibility, he maintains that the prosecutor's comment amounted to implicit vouching. We do not agree.
A prosecutor engages in implicit vouching when he or she relies on information not before the jury to bolster a witness's credibility. See United States v. Hands, 184 F.3d 1322, 1333-34 (11th Cir. 1999) (finding it improper for the prosecutor to state that the wife would have echoed her husband's trial testimony, where the wife was never called as a witness); Eyster, 948 F.2d at 1207 (finding it improper for the prosecutor to suggest that inconsistencies in a key witness's testimony could be explained by a typographical error, where there was no evidence to support the prosecutor's typographical error theory). As we stated in United States v. Martinez, 96 F.3d 473, 476 (11th Cir.1996), "argument to the jury must be based solely on the evidence admitted at trial."
Unlike the problematic comments in Eyster and Hands, the prosecutor's statement in this case was based on information presented to the jury. Agent Thompson testified that he and Investigator Gaddis went to the police station to interview Mr. Epps, that he introduced *1101 Investigator Gaddis to Mr. Epps, and that Investigator Gaddis signed Mr. Epps's waiver of rights form as a witness. As nothing in the record indicates that Investigator Gaddis left in the middle of the interview, it was permissible for the prosecutor to suggest that Investigator Gaddis was present when Mr. Epps confessed. No reversible error exists where "the Government simply [makes] explicit an inference that the jury could have drawn from the evidence." United States v. Campbell, 223 F.3d 1286, 1290 (11th Cir.2000); see also United States v. Smith, 700 F.2d 627, 633 (11th Cir.1983) (noting that a lawyer in closing argument has the "`right to state his contention as to the conclusions that the jury should draw from the evidence'" (quoting United States v. Morris, 568 F.2d 396, 401 (5th Cir.1978))). Because the prosecutor made a permissible inference based on the evidence admitted at trial, the prosecutor's statement that somebody else was present during Mr. Epps's confession did not constitute improper implicit vouching.
Even if we were to assume that the comment was improper, Mr. Epps cannot satisfy the second prong of the prosecutorial misconduct test. The remark did not prejudicially affect Mr. Epps's substantial rights, because it did not "`so infect[ ] the trial with unfairness as to make the resulting conviction a denial of due process.'" Eyster, 948 F.2d at 1206 (alteration in original) (quoting Donnelly v. DeChristoforo, 416 U.S. 637, 643, 94 S.Ct. 1868, 1871, 40 L.Ed.2d 431 (1974)). A denial of due process occurs when "`there is a reasonable probability that, but for the prosecutor's offending remarks, the outcome of the ... [proceeding] would have been different.'" Id. at 1206-07 (alteration in original) (quoting Kennedy v. Dugger, 933 F.2d 905, 914 (11th Cir.1991)) (internal quotation marks omitted).
In this case, even setting aside any corroborating effect due to Investigator Gaddis's presence during the interview, there is no reasonable probability that the jury would have returned a different verdict. Mr. Epps gave a detailed confession to Agent Thompson, which included specifics about the disguise he wore during the robbery, which bank tellers he approached, the dye packs exploding inside the pillowcase, why his first attempted carjacking failed, the circumstances of the second carjacking, his flight toward the mall, and his use of superglue on his fingers to avoid leaving fingerprints. Many of these details were corroborated by the testimony of the tellers, the carjacking victims, and Deputy Kent. There was also strong circumstantial evidence that Mr. Epps committed the bank robbery. He was seen running away from a carjacked vehicle closely linked in space and time to the robbery; ignored repeated police orders to stop; pointed a gun at a pursuing officer; and was carrying a pillowcase that contained a wig, a black bag, dye packs, and dye-stained money consistent with the materials used or taken during the robbery. In light of the evidence against him, Mr. Epps has failed to show that his substantial rights were affected by the alleged prosecutorial misconduct.
IV.
For the reasons described above, the district court's denial of Mr. Epps's motion to suppress, as well as Mr. Epps's convictions and sentence, are
AFFIRMED.
NOTES
[1] The two other arguments that Mr. Epps raises on appeal are without merit. First, the district court did not clearly err in denying Mr. Epps's motion under Batson v. Kentucky, 476 U.S. 79, 106 S.Ct. 1712, 90 L.Ed.2d 69 (1986). Regardless of whether Mr. Epps established a prima facie case of discrimination, the potential juror's misunderstanding of the jury questionnaire was a plausible, race-neutral basis for the government's exercise of a peremptory strike. Second, the district court did not abuse its discretion in sentencing Mr. Epps to 360 months imprisonment. The district court properly reviewed the mitigating evidence, weighed the 18 U.S.C. § 3553(a) factors, and considered the arguments of counsel when it imposed the sentence.
[2] The Supreme Court held in Sanders that the automobile exception to the warrant requirement does not allow police to search luggage taken from a lawfully stopped automobile. 442 U.S. at 766, 99 S.Ct. at 2594. The Acevedo Court overruled the main holding of Sanders by deciding that "[t]he police may search an automobile and the containers within it where they have probable cause to believe contraband or evidence is contained." 500 U.S. at 580, 111 S.Ct. at 1991. "However, because Acevedo was expressly based on an application of the automobile exception, it does not alter the principle set forth in Sanders that there is no reasonable expectation of privacy in a container that discloses its contents." United States v. Huffhines, 967 F.2d 314, 319 n. 5 (9th Cir.1992). We join our sister circuits that have considered the question in concluding that "the logic of the Sanders footnote has survived." United States v. Villarreal, 963 F.2d 770, 776 n. 2 (5th Cir. 1992); see also United States v. Meada, 408 F.3d 14, 23 (1st Cir.2005); United States v. Williams, 41 F.3d 192, 196-98 (4th Cir. 1994); United States v. Banks, 514 F.3d 769, 773-74 (8th Cir.2008); Huffhines, 967 F.2d at 319 n. 5; United States v. Donnes, 947 F.2d 1430, 1437 (10th Cir. 1991); United States v. Taylor, 497 F.3d 673, 679-80 (D.C.Cir.2007).
[3] In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir.1981) (en banc), we adopted as binding precedent all decisions of the former Fifth Circuit handed down before October 1, 1981. | 01-03-2023 | 08-06-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3856574/ | Argued October 13, 1927.
Plaintiff has a verdict and judgment thereon in the municipal court for injuries to his person and for damages to his half-ton Ford truck, resulting from a right-angle collision with defendant's Ford sedan at the intersection of York Road and Wagner Avenue in the City of Philadelphia. Defendant now appeals and assigns for error the refusal of his point for binding instructions and the denial of his motion for judgment n.o.v. The intersecting streets are each approximately thirty-six feet from curb to curb; York Road runs north and south and Wagner Avenue east and west. The grade of York Road ascends slightly north of Wagner Avenue, which is practically level, and there are two trolley tracks on York Road. The evidence with respect to the circumstances of the collision is irreconcilably conflicting. Plaintiff was driving his small Ford truck south on York Road and defendant his Ford sedan west on Wagner Avenue. There was at least one other vehicle preceding defendant's car westwardly on Wagner Avenue and into its intersection with York Road — a large Mack truck. Plaintiff testified that as he was coming down York Road the traffic *Page 6
"was congested a little bit" at Wagner Avenue and that he saw the big five-ton Mack truck coming "fairly fast" out of Wagner Avenue upon his left, and continued: "The Mack truck was coming across the street, and about the time that I reached Wagner Avenue, the Mack truck was a little ahead of me, so I left the Mack truck go on down York Road, and I went on the right-hand side of the Mack truck and I was just about three-quarters of the way across the street, across Wagner Avenue when I felt something hit me, and that is the last I did feel until I woke up in the hospital." Both vehicles were overturned and plaintiff's version is that his truck was struck on its left side near the rear by defendant's sedan. A witness who was standing on the southwest corner of York Road and Wagner Avenue at the time of the accident testified in behalf of plaintiff: "Well, the way I seen, that little truck was coming down south on York Road....... It was about the other side of the street when I seen another car, a sedan coming from Wagner Avenue passing York Road, and it happened that the sedan crashed into the rear of the little truck and turned it over, also the sedan went over on one side." This witness, experienced in driving automobiles for thirteen years, testified that in his judgment plaintiff's car was running between fifteen and twenty miles an hour and that defendant was driving faster, "between twenty-five and thirty, something like that."
On the other hand defendant testified that he was coming west on Wagner Avenue approaching York Road and intending to cross it; that there were two vehicles ahead of him — a touring car and the Mack truck; that he looked both north and south on York Road; that there was nothing coming from the south, but several machines, one of which proved to be the plaintiff's, were approaching from the north and that plaintiff's truck was then from fifty to seventy-five feet north of *Page 7
Wagner Avenue. His account of the accident was: "I followed the procession of traffic, and as I was almost across York Road, that is, my back wheel was in the last of these two car lines when I was hit in the rear, I was turned over, upset, and Mr. Hood's [plaintiff's] car was also turned over by the impact." Defendant testified that he was traveling about ten miles an hour and that he kept watching plaintiff's truck which was "coming down at a moderate rate of speed," but faster than defendant was running. On cross-examination, however, defendant, after stating that when he first saw plaintiff's truck it was from fifty to seventy-five feet north of Wagner Avenue and he was about fifteen feet east of York Road, admitted that he did not again look for plaintiff's truck: "Q. And when was the next time you saw it? A. When I was hit. Q. Not until after you were hit, is that right? A. Yes, sir, because I was looking — my attention was drawn to the traffic ahead of me. I was following the traffic. I had no reason to look otherwise....... Q. Then you will say that it is true that you saw Mr. Hood's car seventy-five feet away the first time you looked, and you never saw it again until after the accident, is that correct? A. Yes, sir." Defendant further testified that the Mack truck did not turn south on York Road but continued across York Road and west on Wagner Avenue, as did also the touring car which was following it. He was corroborated to some extent by the driver of a car which was following the plaintiff's south on York Road. The respective positions of the cars after the accident and the nature and location of the injuries to plaintiff's truck seem to corroborate the plaintiff's version of the accident. There are no writings to consider on this appeal and, in disposing of it, all the evidence, and proper inferences therefrom, favorable to plaintiff must be taken as true and all unfavorable to him must be rejected. The sole *Page 8
inquiry is whether binding instructions should have been given for the defendant: Hunter v. Pope, 289 Pa. 560; Caldwell v. Continental Trust Company, 291 Pa. 35. Appellant bases his argument largely upon the alleged contributory negligence of the plaintiff. At the trial the burden was upon plaintiff to establish the negligence of the defendant by proof of facts which did not in themselves show that plaintiff was guilty of contributory negligence: Grimes v. P.R.R. Co., 289 Pa. 320. The plaintiff's case did not disclose facts which would have warranted the trial judge in declaring him guilty of contributory negligence. We think the above excerpts from the testimony show that this was a case in which the questions of defendant's negligence and plaintiff's alleged contributory negligence were both clearly for the jury. There is a sharp conflict in the testimony as to whether the defendant arrived at the intersection such a substantial distance in advance of plaintiff that, under the law of the road, he was entitled to proceed, using reasonable care (Wescott v. Geiger, 92 Pa. Super. 80), irrespective of the statutory right or left rule (Weber v. Greenebaum, 270 Pa. 382) ; or whether the vehicles approached the intersection of the highways approximately "at the same time," within the meaning of the Act of June 30, 1919, P.L. 678, as amended, (the last amendment applicable to this case being by the 10th Section of the Act of April 27, 1925, P.L. 254, 279), thereby creating a situation to which the provisions of the act were applicable and in which it became the duty of defendant to give way to the plaintiff, "approaching from the right," and stop if necessary to avoid a collision. When a driver approaching from the left, as did appellant, might, through the exercise of reasonable judgment, have anticipated the simultaneous arrival of the vehicles at the point of intersection he is under an affirmative duty to keep out of the other's way: *Page 9
Weber v. Greenebaum, supra. Under the evidence there was such doubt as to the facts and the inferences to be drawn from them as to require the submission of the entire case to the jury: Gray v. Ohio Grease Company, 283 Pa. 461.
Judgment affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3854712/ | Argued October 24, 1933.
Libellant appeals from an order of the court below directing him to pay the respondent alimony pendente lite.
His libel was filed under the Act of May 2, 1929, P.L. 1237, sec. 12, to secure an annulment of his marriage with respondent on the ground that it was bigamous. He claims, (1) that it makes no difference that he knew at the time of the performance of the ceremony with respondent that she had a husband living from whom she had not been divorced; because the Act of 1929, differing from the Act of April 14, 1859, P.L. 647, does not limit the application for *Page 543
annulment to an "innocent or injured party." See Baker v. Baker, 84 Pa. Super. 544. We think the language of section 12 of the Divorce Code of 1929 is broad enough to sustain this claim, and that in all cases of bigamous marriage "either party" may now apply for annulment. See Report on Bill Codifying and Consolidating the Laws Relating to Divorce and the Annulment of Bigamous Marriages (Legislative Reference Bureau, Bulletin 27, p. 13).
He also claims (2) that the Divorce Code of 1929 makes no provision for the allowance of alimony pendente lite to a respondent wife in such proceedings. To this we cannot agree. The Act of 1929 treats libels for divorce and petitions for annulment of alleged bigamous marriages, except as just above stated, on the same plane. The title of the Act includes them both. The grounds for divorce and annulment of marriage are comprised under one heading or subdivision; the grant of jurisdiction (sec. 15) is the same in both; and section 12, which relates to the annulment of bigamous marriages, specifically provides that the supposed or alleged marriage may be declared null and void "in accord with the principles and forms hereinafter prescribed for cases of divorce from the bonds of matrimony;" thus, in effect, establishing the sameprocedure for the annulment of a bigamous marriage as is prescribed for divorce from the bonds of matrimony: Report on Bill Codifying and Consolidating the Laws Relating to Divorce, etc., supra, p. 13.
Section 46 of the Act — now amended by the Act of May 25, 1933. P.L. 1020 — provides that in cases of divorce from the bonds of matrimony, "the court may, upon petition, in proper cases, allow a wife reasonable alimony pendente lite and reasonable counsel fees and expenses." In passing upon the Act of 1859, supra, which provided that in case of bigamous marriage "the jurisdiction shall be exercised and proceedings *Page 544 conducted according to the principles and forms which are orshall be prescribed by law for cases of divorce from the bondsof matrimony" — almost precisely the language used in section 12 above —, we held that "one of the principles established in our law with respect to actions of absolute divorce is that, pending the proceedings, a wife destitute of a separate estate will be allowed a reasonable sum for alimony and for the expense of suing or defending the action" and that "under the provisions of the Act of 1859, this principle likewise applies to a wife contesting her husband's action for a decree of nullification under that act": Baker v. Baker, 84 Pa. Super. 544,545, 546. In providing that the principles and forms prescribed for cases of divorce from the bonds of matrimony should apply to petitions for annulment of bigamous marriages the legislature intended, in our view, to enact a general provision which would obviate the necessity of specially mentioning `annulment of marriage' every time it made subsequent provision relative to the practice and proceedings in cases for divorce from the bonds of matrimony; but that those provisions are to be construed and interpreted as if the subject `annulment of marriage' were specially included in the subsequent sections relating to pleading and practice in cases of absolute divorce; and that, accordingly, it must be read into and applied to section 46 relating to alimony pendente lite. The Act of 1929, codifying and consolidating the laws relating to divorce and the annulment of bigamous marriages is presumed to have been passed by the General Assembly with knowledge of the law on the subject as it then was, and of the construction placed by the courts on such existing statutes as might be incorporated into the Code, and in so far as those statutes have been incorporated into the Code, they will be understood as continuing the law as declared *Page 545
except to the extent that the Code clearly and definitely changes it: Davidson v. Bright, 267 Pa. 580, 589, 110 A. 301; Mindlin v. O'Boyle, 278 Pa. 212, 217, 122 A. 294; Gratz v. Ins. Co. of N.A., 282 Pa. 224, 234, 127 A. 620; Keim v. City of Reading, 32 Pa. Super. 613, 620; Grakelow v. Nash, 98 Pa. Super. 316,325, 328. See also Baker v. Baker, supra; York v. York, 107 Pa. Super. 522, 164 A. 87.
(3) Appellant's third contention is that no alimony can be awarded respondent, because she did not deny that the marriage was bigamous when it was performed. But she does aver that her former husband has since died and that after his death the libellant and she entered into a common law marriage and have since cohabited as husband and wife.
If after the death of respondent's first husband she and the libellant had been married again by an officiating minister, pursuant to a license duly issued, one would scarcely contend that the libellant could proceed under the Act of 1929 to have his prior marriage with the respondent annulled. What the State is concerned with in such proceedings is the present status of the parties, not what it may have been in the past. If the parties are now legally married and have been legally cohabiting as husband and wife, the law — that is the law governing divorces, etc. — will not now give itself concern with the relationship which may have existed between them before their legal marriage, or take jurisdiction to declare that their past status was a bigamous marriage, if it has since been changed into a legal marriage. The law does no such vain thing. If at the time of presenting the petition for annulment it should appear that the marital status of the parties at that time was legal and that they were then legally married and were husband and wife, it will not use its process to decree that a prior marriage, which has been followed by a valid marriage, was bigamous, null *Page 546
and void. It is to the interest of the State that persons living together in the family relation should be married and that the relationship of husband and wife and that of the family be preserved and not be lightly destroyed. No useful purpose would be subserved by decreeing that a past marital status was bigamous and void if before its annulment was asked for the parties had created a valid, legal marital status; and the statute does not require or contemplate its being done.
This being so, we must bear in mind that the law of this State recognizes a common law marriage as valid, legal and binding. It has the same force, effect and sanctity as one performed by a minister or magistrate. And if such a marriage was entered into between libellant and respondent after the death of the latter's prior husband and at a time when both parties were able to contract a valid marriage it cured the defect of the prior marriage, to the extent that thereafter no annulment of the prior marriage would be decreed, but the present legal status would be preserved until either gave the other just cause for divorce.
Of course mere cohabitation does not constitute a common law marriage: Murdock's Est., 92 Pa. Super. 275. We are using that latter term in the sense placed upon it by the settled decisions of the Supreme Court, and of this court. It is not necessary at this time to elaborate upon the matter.
The assignment of error is overruled and the order of the court below is affirmed at the costs of the appellant. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/90719/ | 106 U.S. 589 (____)
THOMPSON
v.
PERRINE.
Supreme Court of United States.
Mr. Timothy F. Bush and Mr. F.N. Bangs for the plaintiff in error.
Mr. William M. Evarts for the defendant in error.
MR. JUSTICE HARLAN delivered the opinion of the court.
In Thompson v. Perrine, 103 U.S. 806, we affirmed a judgment of the Circuit Court of the United States for the Southern District of New York, against the town of Thompson, in that State, for the amount of certain coupons of bonds, executed in behalf of that town, by virtue of the provisions of an act passed May 4, 1868, and amended April 1, 1869. Those *590 acts, as will be seen from the statement of the former case, authorized the town of Thompson, in aid of the construction of a railroad from Monticello, N.Y., to Port Jervis, in the same State, a majority of its taxpayers, appearing upon the last assessment roll, and representing a majority of the taxable property, not including lands of non-residents, having first consented to the debt being contracted, to issue bonds, and to invest the proceeds, when disposed of, in the capital stock of the railroad company organized to construct the proposed road. Bonds were issued, and instead of selling them and investing the proceeds in the company's stock, the local authorities exchanged them directly with the railroad company for stock. This, according to certain decisions of the highest court of New York, was in violation of the act giving authority to issue the bonds. But, by an act passed April 28, 1871, previous to which time the bonds had been issued and delivered, that exchange for stock was, in express terms, ratified and confirmed. And the controlling question in the former case was as to the constitutional validity of the latter statute. In Horton v. Town of Thompson, 71 N.Y. 513, decided January, 1878, the Court of Appeals of New York held, that as the taxpayers had only consented to an issue of bonds, the proceeds of the sale of which should be invested in stock, it was beyond the power of the legislature to validate bonds, which, in violation of the act under which they were issued, were not sold, but were directly exchanged for stock, of which fact all purchasers had notice from the recitals of the bonds themselves. The adjudication, it was contended by counsel, was binding upon us. But to that proposition we declined to give our assent, and stated, with some fulness, the reasons why we could not give to the decision in the case just cited the effect claimed for it by the town.
We held, for reasons which need not be repeated, that it was within the constitutional power of the legislature of New York to pass the curative statute of April 28, 1871, and that from the moment it was enacted (if not before) the bonds, by whomsoever held, whether by the railroad company or others, became binding obligations upon the town, as much so as if they had originally been sold and the proceeds invested in *591 stock of the railroad company, as required by the acts under which they were issued.
That decision controls the present case; for the latter, in its essential features, differs from the former only in the circumstance of the time when Perrine acquired title to the coupons in suit. Those heretofore sued on were purchased by him in 1875, while those now in suit were purchased by him in 1878, when they were overdue, and after the decision in 71 N.Y. was announced. Counsel for the town now insist that this court should follow the ruling in Horton v. Town of Thompson, at least as to holders of coupons or bonds who purchased after it was decided; and they suppose that this court placed its former decision upon the ground mainly that Perrine had purchased the bonds there in suit before the Court of Appeals declared the act to be unconstitutional. But in this view we do not concur. The reference, in the former case, to the date when Perrine purchased, was to illustrate the injustice which would be done were we, in opposition to our own view of the law, to follow the ruling of the State court made after he purchased, a decision which, with entire respect for the State court, was held not to be in harmony with its former decisions. What we decided was that the curative statute was within the limits of the legislative power, and that, at least from its passage, the bonds, by whomsoever held, whether by the railroad company or others, became enforceable obligations of the town. Ohio Life Insurance & Trust Co. v. Debolt, 16 How. 416; Mitchell v. Burlington, 4 Wall. 270; Taylor v. Ypsilanti, 105 U.S. 60.
There is, however, one point made in this case, not made in the former one, and which it is our duty to notice. It is, that this action is excluded by statute from the jurisdiction of a Circuit Court of the United States.
The eleventh section of the act of Sept. 24, 1789, c. 20, declares that no District or Circuit Court shall "have cognizance of any suit to recover the contents of any promissory note or other chose in action in favor of an assignee, unless a suit might have been prosecuted in such court to recover the said contents if no assignment had been made, except in cases of foreign bills of exchange." The provision in the act of *592 March 3, 1875, c. 137, is: "Nor shall any Circuit or District Court have cognizance of any suit founded on contract in favor of an assignee, unless a suit might have been prosecuted in such court to recover thereon if no assignment had been made, except in cases of promissory notes negotiable by the law merchant, and bills of exchange."
It is not claimed that the words "assignee" and "assignment," as found in the act of 1875, have any meaning different from that attached to the same words in the act of 1789, or in sect. 629 of the Revised Statutes. But the contention of counsel is that the coupons in suit, being detached from the bonds and overdue when Perrine purchased them, were dishonored, and, therefore, not negotiable by the law merchant; consequently, it is claimed, they are not within the exception of promissory notes negotiable by the law merchant, but are embraced by the general inhibition upon suits founded on contract where the assignor himself could not have sued in the Circuit Court.
This position cannot be sustained. It is an immaterial circumstance that the coupons, when purchased by Perrine, were detached from the bonds. And the bonds not having then matured, the coupons, though overdue, had not lost the quality of negotiability by the law merchant. This result must follow from the principles announced in Cromwell v. County of Sac, 96 U.S. 51. Further, and apart from any consideration of the question as to the negotiability, according to the law merchant, of these coupons, Perrine is not an assignee within the meaning of the act of 1875, or of the previous statutes relating to the same subject. Giving the words assignee and assignment their broadest signification, and conceding that, in some cases, the holder of a promissory note may become such in virtue alone of an assignment, yet, according to the established construction of the act of 1789, the right of the holder of a promissory note or bond, payable to a particular person or bearer, to sue in his own name, did not depend upon the citizenship of the named payee or of the first or any previous holder; this, because, in all such cases, the title passed by delivery and not in virtue of any assignment. In Bullard v. Bell, 1 Mason, 243, Mr. Justice Story said, that to bring a case *593 within the exception contained in the eleventh section of the act of 1789, "the action must not only be founded on a chose in action, but it must be assignable; and the plaintiff must sue in virtue of an assignment." "A note," said he, "payable to bearer, is often said to be assignable by delivery; but in correct language there is no assignment in the case. It passes by mere delivery; and the holder never makes any title by or through any assignment, but claims merely as bearer. The note is an original promise by the maker to pay any person who shall become the bearer; it is, therefore, payable to any person who successively holds the note bona fide, not by virtue of any assignment of the promise, but by an original and direct promise, moving from the maker to the bearer." In Bank of Kentucky v. Wister, 2 Pet. 318, 326, this court said that it had "uniformly held that a note payable to bearer is payable to anybody, and is not affected by the disabilities [to sue] of the nominal payee." Thomson v. Lee County, 3 Wall. 327; Bushnell v. Kennedy, 9 id. 387; City of Lexington v. Butler, 14 id. 282; Cooper v. Town of Thompson, 13 Blatchf. 434; Coe v. Cayuga Lake Railroad Co., 19 id. 522.
The coupons in suit are payable to the holder thereof, and, upon the authority of the adjudged cases, Perrine is not an assignee within the meaning of the act of 1875. He is entitled to sue without reference to the citizenship of any previous holder.
We perceive no error in the record.
Judgment affirmed. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3861613/ | Argued November 16, 1927.
Plaintiff, as executor of his mother, Sarah Jane Pizor Vogan, brought an action of replevin against his sister, Lillian Jordan, to recover two promissory notes for $500 each, and a certificate of deposit for $720 payable to the deceased, alleged to be part of the assets of the mother's estate at the time of her death (July 14, 1924), to which plaintiff had the right of possession. The statement filed averred that during the year 1924, defendant took said property and had it in her possession without any legal right to such possession and without any title to, or ownership of, it and refused to deliver it to plaintiff, although demanded so to do. The defense set up was that of a voluntary gift. On the trial it appeared that the deceased was survived by plaintiff and defendant and the children of a deceased daughter. The appraised value of her estate (including the securities in dispute) was $4,746.50. By her will dated December 12, 1920, she left $1,000 to her daughter, about $520 to the childen of the deceased daughter and the remainder of her estate to her son. The deceased was about seventy-six years of age and took sick in her own home June 28, 1924. Defendant attended to her there for three days and then took her to her own home on an adjoining farm and took care of her for ten days before she was taken to a hospital where she died July 14, 1924. Plaintiff testified that during the three days she remained at home she "was lying on the cot part of the time and part of the time going about the house"; and that when he saw her from time to time at defendant's *Page 522
house "she was in a weak physical condition ...... and from some remarks she made I thought that it showed that her mind was a little weak, ...... my opinion was her mind was some weak." Other lay witnesses testified that during her sickness the woman's mind was in a weak condition. The attending physician, called by plaintiff, testified that her mental condition was good on June 28th; that on July 1st, she had some fever and was somewhat out of her head and a pretty sick woman but she had improved on July 2nd and had improved still more on July 4th, and that he did not notice anything the matter with her mind after July 1st. Defendant's witnesses testified that they visited the deceased while she was at her daughter's home and conversed with her, and that her mental condition seemed to be normal. One witness for defendant testified that a day or two before the deceased went to the hospital she asked her how she was. She answered, "Not very good...... I am afraid I am not going to get well." The witness asked her, "Have you your business affairs fixed up?" She said, "Yes, I have all but some papers that I have given to Lilly (defendant) and I want her to have them but she won't allow me to sign them." The witness said, "Lilly, if your mother wants to sign those papers why won't you allow her to sign them?" and that Lilly went to another room and came back with the two notes and bank certificate in question and handed them to her mother who was in bed; that the mother, who was in bed, "just swung her feet out on the floor and sat on the edge of the bed," and "asked Lilly to get her a pen, and Lilly went out and brought in — I think it was a fountain pen, and she signed the notes and bank certificate and she said to me `I don't know whether you can read them or not, I can't see very good.' It was not written very straight. And then she handed them to her daughter;" ...... *Page 523
that the daughter went out of the room and got a pink envelope and put the papers in it and sealed it and handed it to the witness who took it home and put it in a safe where it remained until plaintiff demanded it about two weeks after the mother died, when the contents of the envelope were handed over to defendant. The verdict was for plaintiff and defendant has appealed from the judgment entered thereon.
The questions presented for our determination are: (1) Whether the instructions of the trial judge were erroneous, and (2) whether error was committed in refusing to affirm points presented by defendant for charge. The legal principles controlling in cases in which the issue is whether there has been a gift inter vivos are so familiar and have been so recently set forth by our Supreme Court (Northern Trust Co. v. Huber, 274 Pa. 329; Yeager's Estate, 273 Pa. 359), that only a brief statement thereof is required here. To establish such a gift two essential elements must appear: an intention to make the gift then and there, and an actual or constructive delivery at the same time, of a nature sufficient to divest the giver of all dominion, and invest the recipient therewith. If the gift is from a parent to a child the action of the donor is viewed as but natural, and less evidence is required to establish the intention. If it appears there was a voluntary delivery without explanatory words, and a retention of possession by the transferee, so related, it can be assumed that there was an intention to give. Ordinarily affirmative evidence of the fairness of the voluntary transfer is not required. As between such parties there is no presumption of the invalidity of a voluntary gift and, unless there is evidence of undue influence or of circumstances that give rise to a suspicion, the burden is not on the donee to show the fairness of the transaction: Vaughn v. Vaughn, 217 Pa. 496. A presumption of fairness arises by reason *Page 524
of the relationship of the parties and facts establishing undue influence, or that the parties did not deal on equal terms must be shown affirmatively by those attacking the transaction. In the case of strangers a different rule applies, and the law then casts upon the donee the burden of showing the gift was the voluntary and intelligent act of the donor: Stepp v. Frampton,179 Pa. 284. In Yeakel v. McAtee, 156 Pa. 600, there was a gift from a mother of eighty years, blind and helpless, to her daughter who had attended her for many years. It was held that the gift was valid and that the burden of proving that it was the voluntary and intelligent act of the donor did not rest on the daughter.
We pass to the question whether the legal principles stated were properly applied in the instructions given to the jury by the trial judge. The instruction, which is the subject of the first and second assignments of error, is as follows:
(1) "The defendant was the only person there to look after her. Defendant nursed her, gave her her medicine, waited upon her and had entire charge and control of her. The sickness, some of the witnesses say, affected her mind. These facts, under all the circumstances of this case, cast the burden on the defendant to prove by the weight of the evidence that when Mrs. Vogan delivered the papers to her she intended them to be a gift, and she must show by the fair weight of the evidence that the gift was fairly obtained, voluntarily made and fully understood.
(2) When a daughter is nursing her mother under such circumstances as shown in this case, a confidential relation exists that raises a presumption of legal fraud in connection with any gift obtained while the relationship continues, and this presumption must be overcome by showing that it was fairly obtained, voluntarily made and well understood, in order to make it valid." *Page 525
According to the principles and authorities above noted, the burden of proving that the gift was fairly obtained and fully understood did not rest upon defendant. The daughter did not occupy any position of trust or confidence toward her mother. There is no evidence that she was the agent of the mother in the transaction of any of her business or the management of her affairs. No fraud or undue influence is asserted. Having produced evidence of the intention to give and an actual delivery, defendant met the burden of her affirmative defense. The trial judge should have submitted to the jury the question whether under the evidence the mental and physical weakness of the mother was such at the time of the transfer of the securities as to render it certain that they did not deal on equal terms. In some cases the question whether the parties dealt on equal terms is one of law, but here we think that it was a question of fact to be established by the evidence, and that by reason of the relationship of the parties the burden of proving that they did not deal on equal terms was on plaintiff. Unless and until that fact was established defendant did not have the burden of proving that the gift was fairly obtained or fully understood by her mother, but could rest on the presumption of fairness arising from the relationship. McConville v. Ingham, 268 Pa. 507, is readily distinguishable from this case upon its facts, and is not in conflict with our conclusion. The instruction could not fail to prejudice defendant and is sufficient ground to make a new trial necessary.
That the part of the charge complained of in the second assignment is clear error is demonstrated by the principles already noted. We think the foregoing discussion is a sufficient answer to the questions raised by the third, fourth and fifth assignments of error, so far as they are covered by the statement of the question involved.
The judgment is reversed and a new trial awarded. *Page 526 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3861615/ | Argued October 2, 1942.
This is an appeal by Frederick H. Harper, Jr., Inc., from the affirmance of the order of the Pennsylvania Liquor Control Board refusing to grant renewal of hotel liquor license to it and the dismissal of its appeal by the court below. A license held by appellant permitting the sale of liquors and malt and brewed beverages in the Fort Jackson Hotel in the Borough of Waynesburg, Greene County, was to expire April 30, 1942. Appellant's application for a renewal of its license was denied by the Pennsylvania Liquor Control Board on February 17, 1942, on the ground that local option referenda held September 9, 1941, had resulted *Page 571
in a majority vote against the licensing of the sale of either liquor or malt or brewed beverages within the borough, and that consequently it was prohibited by law from renewing the license of the applicant. Appellant was permitted to waive a hearing before the board, and it appealed directly to the Court of Quarter Sessions of Greene County. It there attacked the legality of the referenda on numerous grounds.1 Four individuals were allowed to intervene as respondents with the right to appear and defend. The court below, after hearing, affirmed the refusal of the renewal of the license, and dismissed the appeal.
It appears from the record that the holding of the referenda of September 9, 1941, was itself preceded by a controversy independent of the present issue. On July 9, 1941, the County Board of Elections of Greene County (the county commissioners constitute this board) issued public notice of the holding of a primary election for the nomination of candidates for state, county, township, and borough offices, and advertised the same in two newspapers, published in Waynesburg, in the issues of July 10 and July 17, 1941. This notice contained the following paragraph: "In case a petition for a referendum on the question of granting Liquor Licenses or in case a petition for a referendum on the question of granting malt and brewed beverage Retail Licenses, each properly prepared and signed, should be filed with the County Board of Elections at least Sixty Days prior to September 9, 1941, the question shall be submitted to the qualified electors at the fall Primary Election mentioned in this proclamation."
On July 9, 1941, petitions for referendum on both *Page 572
questions were filed. These petitions contained the signatures of 719 persons purporting to be qualified electors of the borough of Waynesburg. The registration commission, upon examination of these petitions, certified that, for various reasons, 104 of these persons were not qualified electors of the borough at the time of subscribing to the petitions. The county commissioners thereupon duly resolved not to submit the referenda on the ballot at the primary election on September 9, 1941, for the reason that the petitions lacked execution by electors equal to at least 25 per cent of the highest vote cast for any borough office at the last preceding general election. See section 502 of the Act of 1933, Sp. Sess., November 29, P.L. 15, Art. 5, as amended by section 1 of the Act of June 16, 1937, P.L. 1762, 47 P. S. § 744-502; section 32 of the Act of May 3, 1933, P.L. 252, as amended by section 1 of the Act of June 16, 1937, P.L. 1827, 47 P. S. § 100n.
On August 9, 1941, five citizens of the borough asked for a writ of mandamus from the Court of Common Pleas of Greene County upon the county commissioners to submit the referenda at the primary on September 9, 1941. An alternative writ was issued, and, after hearing, the court found that 47 signers of the petitions had been improperly disqualified in the registration commission's report to the county commissioners. On August 30, 1941, the court of common pleas orally, from the bench, ordered a peremptory writ to issue commanding the commissioners to submit the referenda at the primary election, and this order was reduced to writing and filed of record on September 2, 1941.
There was no official advertisement of the holding of the referenda other than the provisional paragraph contained in the notice of July 9, 1941. In the present controversy the intervenors, over appellant's objection, were permitted to offer evidence of an advertisement *Page 573
inserted by unnamed individual business men of the borough in a newspaper of general circulation in the borough on September 8, 1941, calling attention to the holding of the referenda, and urging the voters to vote "yes" on the local option questions submitted. Similarly, evidence was admitted of general news publicity given the referenda in the September 9th issue of the same newspaper. The vote on the referendum as to the licensing of liquor sales was 843 in favor of and 1,220 against such licensing. The vote on the referendum as to the licensing of malt and brewed beverage sales was 813 for and 1,172 against. The court below held that the total votes cast were a reasonable number of the 2,884 electors registered in the borough, and that this circumstance, together with actual notice and general public knowledge of the holding of the referenda, operated to relieve the admitted deficiency of the notice required by the statute.
Appellant's fourth and fifth assignments of error challenged the admission of intervenors' evidence of newspaper advertisement and publicity upon which this conclusion of the court below is based.
Within the meaning of the Election Code of June 3, 1937, P.L. 1333, as amended, 25 P. S. § 2600 et seq., a local option referendum is a special election. Kram v. Kane et al., 336 Pa. 113,8 A.2d 398. The Code requires special elections to be held in accordance with its provisions relating to November elections, and section 637, art. 6, 25 P. S. § 2787, reads as follows: "Every special election, held under the provisions of this article, shall be held and conducted in all respects in accordance with provisions of this act relating to November elections and the provisions of this act relating to November elections shall apply thereto in so far as applicable, and not inconsistent with any other provisions of this Act." A November election must be advertised in accordance with other provisions of the Code, *Page 574
and section 1201, art. 12, 25 P. S. § 3041, provides as follows: "The county board of each county shall, at least ten days before each November election, give notice of the same by newspaper publication in the county in accordance with the provisions of section 106 of this act, once a week for two successive weeks immediately prior thereto. Such notice shall set forth . . . . . . (c) the text of all constitutional amendments and other questions to be submitted at such election; (d) the places at which the election is to be held in the various election districts of the county; and (e) the date of the election and the hours during which the polls will be open. Such notice may include a portion of the form of ballot or diagram of the face of the voting machine in reduced size."
Admittedly, compliance with these requirements of notice of the referenda here in question was not accomplished; compliance was impossible between the issue by the court of common pleas of its peremptory writ of mandamus and the holding of the election on September 9, 1941. Cf. Watson v. Witkin et al., 343 Pa. 1,22 A.2d 17. The question presented to this court is whether this is a defect sufficient to nullify the referenda. We are obliged to conclude that it is.
In Kittanning Country Club's Liquor License Case, 330 Pa. 311,198 A. 91, reversing the judgment of this court, 128 Pa. Super. 398, 194 A. 198, our Supreme Court held that a local option referendum in the township of North Buffalo, Armstrong County, was a nullity because the question printed upon the ballots referred to particular election districts within the township, and thus deviated from the form prescribed by section 502 of the Pennsylvania Liquor Control Act of 1933, Sp. Sess., November 29, P.L. 15, art. 5, 47 P. S. § 744 — 502. In that case the Supreme Court, in an opinion by Mr. Justice BARNES, said (330 Pa. 311, at page 318, 198 A. 91, at page 94): "It is well settled *Page 575
that the statutory forms prescribed for use in elections of this character must be rigidly adhered to and any variation therefrom will render the election invalid: Barrett's Appeal, 116 Pa. 486
[10 A. 36]; McLaughlin v. Summit Hill Borough, 224 Pa. 425
[73 A. 975]. In our opinion it is apparent that the question was not submitted to the voters in the form required by statute.
"The form of ballot used in the referendum of November 5, 1935, submitted the question to the electors of North Buffalo Township whether liquor licenses should be granted in two particular election districts of North Buffalo Township. The variation in this case, consequently, consisted in an inaccurate description of the municipality in which the question was submitted to the vote of the electors. This constitutes so material a deviation from the statutory form prescribed for use in elections of this character as to cause the ballot to be lacking in matters essential to the free expression of the will of the voters, thereby rendering the election a nullity."
It follows that adherence to the fundamentals prescribed by the statute was essential to the validity of the referenda on September 9, 1941, and consequently the lack of official newspaper advertisement by the county board of elections of the holding of the referenda at least ten days in advance thereof was not cured by any degree of actual notice or publicity or public controversy. The entire failure to give the statutory notice rendered the special election invalid. This interpretation we think is compelled by the pronouncements of our Supreme Court. Such notice was a fundamental preliminary, rather than an immaterial irregularity or an innocuous deviation from a statutory requirement which might have been previously rectified through resort to the remedy given by law for that purpose as inOncken et al. v. Ewing, 336 Pa. 43, 8 A.2d 402. *Page 576
It is true that in Com. ex rel. Gast v. Kelly, 255 Pa. 475,100 A. 272, it was held that an election will be sustained notwithstanding there was no proclamation, if the electors had general knowledge of it and a reasonable number of votes was polled. However, we cannot apply such a rule of expediency to a matter so strictly governed by statute as our Supreme Court has held a local option referendum to be. Neither is the proportion of votes cast to the total registration of qualified voters persuasive in the absence of controlling authority that such a special election not held de jure may be declared one held de facto. Every voter, even though it is possible that he may have been informed through other channels of publicity, is entitled to notice of the holding of such an election given as the law directs. As said by the Supreme Court in Kittanning CountryClub's Liquor License Case, supra, 330 Pa. 311, at page 320,198 A. 91, at page 95: "Here the point in issue is not the manner in which an election was conducted, or a collateral attack upon the result thereof, but whether an election was ever held upon the subject-matter of the controversy."
The fourth and fifth assignments of error are sustained. The remaining assignments of error thus become immaterial.
The judgment of the court below is reversed, and that court is ordered to direct the Pennsylvania Liquor Control Board to renew the license of the appellant upon compliance with all requirements. Costs to be paid by appellees.
1 The validity of a local option referendum may be tested by an appeal from the refusal of a license in reliance upon the referendum. Kittanning Country Club's Liquor License Case,330 Pa. 311, 320, 198 A. 91; Greene Township Malt Beverage LicenseReferendum Contest, 331 Pa. 536, 1 A.2d 670. *Page 577 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3854744/ | Argued October 13, 1939.
This appeal is governed by the opinion in Benson Gardner versus the same defendants, which is filed herewith.
For the reasons given in said opinion, the assignments of error are overruled and judgment affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3861635/ | RHODES, J., filed a dissenting opinion.
Argued September 28, 1943.
This proceeding had its beginning in new tariffs filed by Philadelphia Transportation Company in which it proposed to increase the cost of passenger travel on its street railways. In the course of the hearings before Pennsylvania Public Utility Commission, when it developed that higher fares were not necessary because of increases in earnings after the tariffs were filed, the proceeding nevertheless continued as an investigation *Page 12
by the commission on its own motion to determine the fair value of the company's transportation properties and the permissible rate of return. Although we are not in entire accord with the conclusions of the commission, our order does not authorize increased fares nor disturb the present schedules of charges for railway, trackless trolley or bus travel in Philadelphia. Whether higher fares may be necessary at some time in the future will depend largely upon costs of operation, in periods of inflationary trend, as well as the degree of acceptance by the public generally, of the means of transportation which the company can supply.
Reference to a few historical facts will be helpful in the approach to the issues in this appeal: Philadelphia Rapid Transit Company, the predecessor operating company, became financially involved. In 1934 it applied to the United States District Court for the Eastern District of Pennsylvania for reorganization under section 77B of the National Bankruptcy Act. The problem was complex, ultimately involving the merger of all of the public passenger transportation facilities of the City of Philadelphia diversely owned by a number of corporations1 each with its own capital structure. There was also a pyramiding of securities of various classes greatly in excess of the value of property upon which they were issued. Under that act,2 approval by the appropriate State regulatory body was *Page 13
necessary to the confirmation of a reorganization plan by the district court. Accordingly such approval by the Pennsylvania Public Utility Commission was sought in this instance. Hearings on the application were begun in February and were concluded in June 1938. The scope and thoroughness of the inquiry is attested by more than 3,000 pages of testimony and 100 exhibits. That record is before us here. Over-capitalization and consequent inability to meet fixed charges were the chief reasons for the failure of the operating company, and the principal concern of the commission in evolving an acceptable reorganization plan was a write-down of fixed and contingent charges by limiting outstanding securities to an amount consistent with the value of the transportation properties involved in the proposed merger, with corresponding debt service demands in keeping with earning power. Accordingly, in the reorganization proceeding the commission addressed itself to: "(1) the original cost of the property in relation to the total amount of securities to be issued or assumed by the new corporation; (2) the past, present and future earning power of the property under reasonable rates; and (3) the distribution of securities among the various participants in the plan." From the testimony, the commission (limiting itself to the above considerations) by order on October 3, 1938 found the fair value of all used and useful property to be $105,419,769, less accrued depreciation of $31,000,000 as of October 1, 1937. That order restricted the aggregate amount of securities to be issued or assumed to $75,357,014. On reconsideration at the instance of the company, the commission on November 22, 1938, without specifically changing its findings as to value and depreciation, approved the issue or assumption of securities of a total face value of $85,015,193. In the order however, the commission stated that it was prompted to agree to this figure by a willingness to depart from its usual *Page 14
rules and precedents (we assume, of conservatism in approving values in relation to capitalization) "in order to facilitate applicant's reorganization, so urgently needed by the public as well as by the holders of applicant's securities." Because of contract relationships between the operating company and the City of Philadelphia it was necessary also to secure the city's approval of the plan contemplated by the commission's order. This approval is evidenced by city ordinance dated May 20, 1939. Philadelphia Transportation Company, incorporated for the purpose of consummating the plan as approved, on January 1, 1940 by merger of the constituent companies, became the owner and operator of all franchises, facilities and properties of its predecessors with these exceptions: it operates Market Street Elevated Railway under lease from a wholly owned subsidiary; the city-owned Frankford Elevated and Broad Street Subway System, and the Delaware River Bridge high speed line became parts of the system under leases from the owners. In the interval between the date of the commission's order and the merger, the existing indebtedness was reduced somewhat by available sinking funds and other retirements. Accordingly the total par or stated values of securities issued or assumed by the present company was $84,149,119, representing $61,855,239 in long term funded debt and $22,293,880 in capital stock.
For more than a year after reorganization the earnings of the new company steadily increased and were adequate to meet operating expenses, interest and dividends. The increased revenues were sufficient also to justify a program of improvment including modernization of much existing equipment and the purchase of many new surface cars, trackless trolleys and busses.3 *Page 15
Because of the impact of increased costs of labor,4 and other operating expense, net earnings receded in 1941 to a point which, in the opinion of the company, justified new tariffs increasing the fares on rail lines. The schedules as filed were to become effective January 15, 1942 but their operation was suspended by orders of the commission to October 15, 1942. In the meantime the City of Philadelphia filed its protest against the new tariffs and the commission started its investigation; consolidated hearings on the city's complaint and the commission's case were concluded in July 1942. By final order on October 13, 1942, applicable to both proceedings, the commission found that the fair value of the company's "used and useful property, as a going concern based on evidence as of December 31, 1941, is $77,000,000, including working capital and cost of financing; including also estimated costs of equipment to be purchased in 1942." The order fixed the rate of return on that valuation at 6%. As a matter of form the commission ordered a cancellation of the new schedules of rates and reestablished the old. Cumulatively, the assignments of error in Philadelphia Transportation Company's appeal challenge the order as confiscatory.
The commission in its decree nisi discussed the conventional elements (Smyth v. Ames, 169 U.S. 466, 18 S. Ct. 418) reflecting fair value. We are not in accord with the commission in the emphasis which it placed on its estimate of original cost and its failure to give *Page 16
proper weight to reproduction costs. We think also that the amount of depreciation charged against each of these estimates is excessive. Other elements considered relevant by the commission must be ignored entirely. Specific items disallowed by the commission, in our opinion, must enter into any reasonable adjudication of a fair base. Other considerations are material to the question, among them, the order of the commission in the reorganization proceeding adjudicating fair value in support of corporate securities at $85,000,000. We will discuss the reasons for our conclusions, insofar as we do not agree with the commission, under appropriate headings.
The Adjudication in the Reorganization Case. Certainly the finding of $85,000,000 for a specific purpose is not res adjudicata here.5 The commission stated and appellant agreed that the value found should not be binding in any other proceeding or for any other purpose. But the final order in that proceeding, about three years prior to the date upon which fair value was determined in the present case has a bearing on the reasonableness of the latter order. All of the evidence is that in the interval the position of the company was improved. Although after reorganization and prior to December 31, 1941, appellant spent $434,668 in modernizing existing equipment and acquired new cars and busses and other equipment costing $7,120,000, the commission found the value of appellant's property to be $8,000,000 less than its value for reorganization purposes before these additions. The first duty of the commission is to the public. In the reorganization case the intention was to wipe out fictitious capital structures by reducing securities to an amount which the value of the property would support. We must assume that the practical aspects of the problem did *Page 17
not prevent the commission from performing its duty in this respect or that the result was a compromise with the facts. Cf. Constitution of Pennsylvania, Art. 16, § 7. McCandless v.Furlaud, 296 U.S. 140, 161, 56 S. Ct. 41. In making the order the commission stated as its judgment that "the reduction in fixed charges is sufficiently close to the standard suggested by us as to make it unlikely that the new company will in the near future become financially embarrassed and be forced once more to undergo reorganization." The "standard" undoubtedly recognized the general principle that the fair value of property pledged for the payment of securities should at least equal their par or stated values. The decree nisi in that proceeding contains a thorough and critical analysis of all of the testimony indicating close scrutiny of every claim of property. Moreover the commission approved a valuation of $85,000,000 wholly upon its finding of original cost depreciated, including cash and net assets other than fixed property. Thus it evidenced regard for the demands of conservatism in determining the amount of securities which the new corporation could afford to assume. On that issue, the commission did not trend original costs, translating them into dollar values on the date in question; and properly, perhaps, refused to consider reproduction costs less depreciation as evidence of total security issues which the property could support. The result, from the method applied, was an adjudication of value within safe bounds, for any purpose. Of course the commission may change its mind or convince itself that it was wrong. But in the absence of a rational basis for a change of position, the finding as it stands is evidence of the fair value of the property in 1941. It is difficult to reconcile the adjudication of $77,000,000 in the present case (resting upon reproduction cost, depreciated, as one of the elements considered) with $85,000,000 of value in the reorganization case based *Page 18
upon depreciated original cost alone. The difference in purpose of the two proceedings does not wholly account for the difference in result.
The order establishing fair value in the present proceeding at $77,000,000 suggests that the commission may be too thoroughly resigned to the fact (emphasized by two of the commissioners in dissenting opinions in which much lower valuations were found) that street railway transportation is a "dying art." It is true that adverse evolutionary processes have had a devastating effect on appellant's property.6 But it is no valid argument, because its property in the future may be worth less, that present values should be discounted to meet that possible contingency. Dealing inadequately with appellant will strengthen the forces of dissolution. The important fact is that appellant is performing an indispensable service in Philadelphia. So long as that service is essential and cannot be replaced, the interests of the public would seem to indicate the wisdom of allowing a reasonable return on a fair valuation to perpetuate the service rather than to hasten its end. Such treatment should supply the company with the incentive to continue to modernize its system and to provide facilities in the future meeting the demand, by conforming with new methods of transportation as they are developed.
In any view of the testimony, we think a valuation of $77,000,000 is low to the point of confiscation. We are of the opinion also that this is a case in which we may properly determine value (Ohio Valley Water Co. v. Ben Avon Borough,253 U.S. 287, 40 S. Ct. 527) in an amount, but only in such amount as is clearly established by the evidence. The problem here is not as complex as in e.g., Peoples Nat. Gas Co. v. Pa. P.U.C.,153 Pa. Super. 475, 34 A.2d 375, and does not rest upon *Page 19
issues of fact nor inferences which are exclusively for the commission. An equally compelling reason is the uncertainty of the future and the speculative character of appellant's business. The prosperity which the company now enjoys is artificial and temporary. The activities of war work and the limitations on the use of private automobiles have created a demand for public transportation which have taxed appellant's facilities to the limit. To what extent purchases of new equipment are justified depends not only on present demands but on the certainty of a base which will permit the company to function in the probable lean years following this abnormal period. Appellant is committed to a long range program of modernizing its system. In approaching that problem and in justification of it, the company should know now that it will be entitled to reasonable earnings on a fair valuation of its property. Cf. Solar Electric Co. v. Pa. P.U.C.,137 Pa. Super. 325, 9 A.2d 447.
Market Value of Securities. The total principal amount of securities on December 31, 1941, representing funded debt, including $3,887,000 equipment trust certificates, was $62,434,848. Their market value was $46,782,895. Preferred stock (754,731 shares — par $20) was selling at $4 and common stock (719,926 shares with a stated value of $10) was selling at $1 a share. The total market value of all issues of stock and securities was $50,521,745 as against $84,728,728 par and stated values. Depressed market value is one of the considerations upon which the commission rested its conclusions. Its relevancy is based on the assumption that what the investing public is willing to pay for securities is evidence of the value of the property of the issuing corporation. Market value of securities is one of the elements to be considered, but it may be important or negligible according to the circumstances. In Smyth v. Ames, Mr. Justice HARLAN did not evolve *Page 20
a formula for determining fair value of the property of a utility with certainty; he did not reduce the problem to an exact science or the method to one of striking averages. Certain indicia of value must be considered but their relative importance depends upon the facts of each case. Thus, market value of securities well above their par may be evidence either that the rate of return or the valuation upon which return is allowed, or both, are too high. On the other hand Smyth v. Ames is no authority for saying that market value, at a fraction of face value of securities, should be further depressed by reducing the basic adjudicated value of the property pledged for their payment or the earnings applicable to interest or dividends. In the present case the market value of the securities may be evidence of too low a valuation. More likely, the market reflects the risks involved and the prejudice of investors against this class of securities because of their speculative character in the light of an uncertain future. We think market value of securities is not an element to be considered on the issues in this case and the commission should have disregarded it.
Book Cost. $108,513,330 appears on appellant's books as an opening entry of the book cost of its transportation property. This figure purports to be based on the commission's finding of total original cost as of October 1, 1937. We think that this book cost and the reserve set up on appellant's books for depreciation are to be considered but only as giving some weight to appellant's contention that the value of the property as adjudicated in the reorganization case was later recognized by the commission as original cost value for rate purposes. As required by the commission in the order in that proceeding, there was submitted to the commission detailed schedules of the journal entries proposed to be used in opening the books of the reorganized company. While it is not contended that the *Page 21
figures submitted were approved by the commission, it is true that they were received and were not criticized by it. Based upon them as adjusted for property added and retired appellant set up accrued depreciation of $26,570,409 leaving a net book value of $85,153,938 on December 31, 1941. Additions of working capital and 1942 purchases of equipment increased the total book value to $92,679,031. While entitled to consideration, appellant's book costs are not of controlling importance even on the narrow issue to which their relevancy must be limited.
Original Cost. The company's estimate, based upon testimony of Henry E. Ehlers, Vice President of Day Zimmerman, was $117,155,000. The commission found original cost to be $104,194,000. Both estimates are based upon actual original cost or historical cost of all items of appellant's transportation property. Despite the difference in the estimates, appellant is in substantial agreement with the commission on disputed items making up the difference, except that of franchise paving. We are in accord with appellant's position as to the capitalization of the franchise costs of paving and will state our view later in this opinion. The question is not vital here for we are of the opinion that the finding of original cost in itself, or less $47,000,000, which the commission found to be the accrued depreciation, has little bearing upon the fair value of the property on December 31, 1941. This finding is ineffective in determining value for the reason that the costs were not trended to reflect current prices of labor and materials on that date."Original cost has been approved as a rate base where (1) there has been no great change in cost levels and (2) there has been a change but proper adjustment is made based upon competent evidence of price trends. See Clark's Ferry Bridge Co. v. P.S.C.,108 Pa. Super. 49, and Scranton-Spring Brook Water Service Co. v. P.S.C., 119 Pa. Super. 117, *Page 22 181 A. 77": Peoples Nat. Gas Co. v. The Pa. P.U.C., supra. It is idle to assume that there have not been great changes in cost levels (as well as in methods of production reducing unit costs) since 1857 and during subsequent years when the items of property were acquired. In the absence of adjustments of original or historical costs to determine present fair value as of the date in question the finding of the commission is entitled to little consideration as a determining element.
Reproduction Cost. Appellant submitted three estimates of reproduction cost of its useful property; two different methods were used in their computation. The commission confined its consideration to the estimate based on unit prices, independently determined by the company, as applied to the property included in the inventory. No evidence of reproduction costs was submitted by the commission or the city. "For the purpose of [its] order" the commission adopted the independently priced estimate of reproduction cost of $177,174,000 (excluding working capital and intangibles but including $15,013,000, franchise paving) adjusted only to exclude an item of indirect cost and that part of paving costs which it did not allow, leaving $162,951,000 as the total reproduction cost accepted by the commission. In adopting this estimate the commission stated: "However, in our fair value determination we will give it such weight as appears proper in the light of quality, or lack of it, of reproduction cost estimates generally and of this one in particular." The commission referred to infirmities which it ascribed to the company's computation of reproduction cost, among them: the fact that the evidence of indirect costs rests upon opinion evidence without adequate supporting data; the estimate included the reproduction cost of all of the units of appellant's property at their present locations although it was admitted, and demonstrated by the conversion program of the company, that the system would *Page 23
not be reproduced in all respects in its present form. This latter criticism suggests an approach from the viewpoint of prudent investment and overlooks the fact that it has been met for the most part by an allowance for depreciation from obsolescence. The appeal of the prudent investment theory is also indicated by this statement of the commission: "it is questionable whether any weight should be given to reproduction cost in making a rate base determination." There follows in the discussion by the commission a quotation from the concurring opinion in Federal Power Commission v. Natural Gas Pipeline Co.,315 U.S. 575, 62 S. Ct. 736, to the effect that the commission may entirely ignore reproduction cost as an element of fairvalue. The quotation emphasizes the statement: "The commission may now adopt if it chooses, prudent investment as a rate base."
The thorough discussion of Judge KENWORTHEY in the Peoples Gas
case, supra, presents the reasons adopted by this court for excluding prudent investment as entering into an estimate of fair value; and his opinion together with the concurring opinion of President Judge KELLER indicates the elements which must be considered as well as those to be excluded under the law of this State in computing present fair value as a rate base. What we have said there, need not be repeated here. Reproduction cost is still an important and essential element entering into an adjudication of fair value in Pennsylvania. Moreover, we may not assume that the commission adopted $162,951,000 as reproduction cost merely because it intended to ignore it as an element of value. That amount stands as the commission's adjudication of reproduction cost of the system and there is ample evidence to support it.
Paving. A number of franchises granted to the street railway companies in Philadelphia required the companies, as consideration for the grants, to pave or repave *Page 24
the streets upon which their lines were laid. Appellant is the successor of these companies and it is conceded that it inherited, by consolidation and merger, whatever rights of capitalization had accrued to predecessor companies from the performance of paving obligations under franchises from the city. In 1893 when the companies proposed to electrify their street railways the city granted supplemental franchise rights made necessary by the changed method of operation. But under the terms of the new franchises the city required them to repave certain streets upon which they operated. The work was done in 1895 and following years at an admitted cost of slightly over $15,000,000. Although the companies had been negligent in constructing and maintaining pavements under original franchises, what was required by the 1893 ordinance was not an accumulation of unfulfilled prior obligations. The paving in question was a new obligation agreed to as the consideration for supplemental franchise rights granted by the city. The cost was the amount required to be paid for the right to operate as electric street railways. The result was the same as if, instead of constructing pavements, the companies had paid the city $15,000,000 in cash.7
The commission recognized that the repaving in question was a franchise obligation but allowed only $3,151,000 representing the *Page 25
construction cost of such pavements only as were still in existence on December 31, 1941. The pavements became parts of the streets owned by the city and, when once laid, the company had no title to them. It is therefore unimportant whether any of the pavements survived to the date when the commission valued appellant's property. Appellant's claim does not rest upon the value of property but on the outlay in dollars spent to acquire the right to operate. Capitalization of the amount so paid for franchise paving, and the duty on the commission to include that amount in its adjudication of fair value is not open to question.Phila. et al. v. Pub. Ser. Com., 83 Pa. Super. 8. Appellant claims an allowance of $7,500,000 — about one-half of the total cost. As the company, the city and the commission all agreed upon a total cost of $7,500,000 for the purpose of reorganization we will limit the allowance to the reduced amount of appellant's claim. There must be included in the base, the additional sum of $4,349,000, being the difference between $7,500,000 claimed, and the amount allowed.
Accrued Depreciation. The commission computed accrued depreciation on reproduction cost at $73,300,000. The method was "using overall ratio of accrued depreciation [$47,000,000] to original costs" as applied to $162,951,000 reproduction cost. Appellant's testimony was that accrued depreciation related to original cost was $20,524,000. The variance between the two estimates of accrued depreciation by the commission and by the company can be accounted for to a large extent by the difference in method applied by each in computing it. The commission used the age-life straight-line method in arriving at depreciation on original cost and applied the result by the above formula to the cost of reproduction. The company's expert viewed and inspected each unit of property and his appraisement of value rests upon the actual condition of the property. *Page 26
From his inspection he determined depreciation from use and other causes as well as from obsolescence. The infirmity in the method of computing lives as the basis for determining accrued depreciation is referred to in the Peoples Gas case. It is adapted to some classes of property in the present case; as to other kinds of property the estimate so founded is wholly inaccurate. As applied to trolley cars, for example, the age-life method will result in estimates which are reasonably reliable. The useful life of a trolley car may be thirty years. By proper maintenance however, (old cars of appellant — some of them 45 years old — were modernized and rejuvenated to meet the war-time demand for transportation) the useful life of a trolley car can be extended indefinitely beyond the limit of its theoretical life though losing rider appeal through obsolescence. The same may be said of other classes of equipment. Appellant refers to items of property which the commission found valueless because of age, which were still being used and continued to be useful. Such property as could be identified in the commission's schedules had a total value of $5,653,477, based on historical costs. The age-life method is wholly misleading when applied to units of property renewed or replaced from time to time. Appellant's tracks perhaps are the best example of this class of property. In the maintenance practice adopted by appellant certain stretches of tracks were renewed each year at the expense of operation. Thus the whole track system was kept in full useful value by the elimination of parts as they deteriorated through wear and tear. Estimates based on age-life which do not take into consideration the actual condition of tracks so renewed and maintained are entitled to little weight. Perhaps appellant's estimate of depreciation of its tracks at an overall rate of 14.7% on original cost is too low. It included in the estimate 80% of the cost of 82 miles of track about to be abandoned; it depreciated other *Page 27
sections of track according to their condition by amounts which may understate depreciation; and the low depreciated value may be uncompensated by the item included as the cost of "deferred renewals." But in any view the sum of $2,721,000, in our opinion, is nearer the true accrued depreciation of tracks than the much higher depreciation found by the commission by application of the age-life method.
In the present case the actual amount of accrued depreciation is somewhere between the two estimates. But if we accept reproduction cost as adopted by the commission and its estimate of accrued depreciation, in the commission's own figures we find support for our conclusion as to the net fair value of appellant's transportation property. The commission found reproduction cost less depreciation to be $89,651,000 ($162,951,000 less $73,300,000). Additional allowed items of working capital, cost of financing and 1942 purchases of new equipment increased the total to $98,276,000.
Rate of Return. The commission allowed 6%; appellant contends for an allowance of 7%. Each utility presents an individual problem. United Rys. Electric Co. of Baltimore v. West,280 U.S. 234, 249, 50 S. Ct. 123. The only opinion evidence on the subject is the testimony of Edward Hopkinson Jr., director of appellant company, who had acted as reorganization manager of the former Transit Company and its underliers under appointment by the district court; and the testimony of Paul B. Coffman, Vice President of Standard Poor's Corporation, a financial statistical service of New York. That these witneses are well qualified, is conceded. Indicating his approach to the question, Coffman stated that what he was principally interested in "was the matter of preservation of investment quality of debt outstanding." (Italics added). We agree with the commission that in his testimony his endeavor was not to preserve but to improve
the quality of the debt *Page 28
outstanding in its investment appeal. Desirable as that may be (particularly since much of the stock of the company is owned by its employees) it is not for the commission or for us to establish or maintain investment quality of securities wholly in the interests of investors. We are concerned with rate of return, also, as it affects the ability of the company to serve the public, and we are not impressed by the argument that by reinstating confidence in appellant's securities, future "equity" issues, subject to underlying securities, may be sold providing funds for capital expenditures. It is doubtful that 7% would work that result or that raising capital by that method will be either necessary or desirable. Efficient operation with the means at hand would seem to be the way for appellant to improve its status. We agree with Mr. Hopkinson that "the rate of return is a matter of public and consumer interest . . . . . . to insure, in good times and bad, the ability of a public utility, which has a duty to serve the public, to have sufficient credit and cash to enable it to fulfill those duties." As suggested by him, appellant is not in the same class as, e.g., water companies or electric utilities whose business is stable and whose earnings in the present are reliable forecasts of earnings for the future. In contrast with utilities of that type, appellant's chances for the future are speculative; the demand for its services cannot be charted with any degree of confidence. No one can predict the conditions affecting appellant's ability to earn in the post war period. Against these uncertainties it should be entitled to a somewhat higher rate of return. "The return should be reasonably sufficient to assure confidence in the financial soundness of the utility and should be adequate, under efficient and economical management, to maintain and support its credit and enable it to raise the money necessary for the proper discharge of its public duties. A rate of return may be reasonable at one time and become too *Page 29
high or too low by changes affecting opportunities for investment, the money market and business conditions generally":Bluefield Water Works I. Co. v. Public Service Commission,262 U.S. 679, 692, 43 S. Ct. 675. Moreover in the long run the company will survive only if it can meet competition by providing the most modern equipment available. The purchase of 748 new trolley cars, trackless trolleys and motor busses, at a cost of nearly $10,000,000, was made possible by the sale of Equipment Trust obligations. More equipment will be bought in the future by the same method. The uncertainties of the future also suggest the wisdom of accumulating a substantial surplus from earnings to meet periods of low transportation demands. For these purposes and because of the degree of the risk, we are of the opinion that a rate of 6 1/2% should be allowed as a reasonable return on a fair valuation.8
Cash Working Capital. Appellant claimed $2,700,000; the commission allowed but $1,000,000. True, all of the company's earnings are on a cash basis. The amount allowed by the commission, with additions from day by day earnings in all probability will be sufficient to meet current payrolls, the cost of supplies, materials, power and other normal operating costs. But the commission's allowance does not take into consideration unusual demands upon working capital which probably will occur from time to time in the transformation of *Page 30
the company's system, as well as from other unforseeable causes. Our first impression was that the claim of appellant is excessive. On considering the foundations for the claim particularly the scope of appellant's operations and the fact that $2,700,000 is no more than the total of one month's operating expense we believe an allowance in that amount is reasonable.
CONCLUSIONS
The fair value of appellant's transportation property on December 31, 1941, was about $87,000,000. We will adopt a lesser figure, $86,951,000, as total value including $3,325,093 for equipment added in 1942. To this sum will be added $1,700,000 additional cash working capital and $4,349,000 franchise paving costs, increasing the total to $93,000,000.9
Appellant is entitled to a return on that amount at the rate of 6 1/2% per annum.
The orders of the commission are modified to conform with this opinion and the above conclusions; each *Page 31
party to pay the cost of printing its brief; the cost of printing the record to be borne equally by appellant and the commission.
1 There were 25 street railway and traction companies, in addition to other companies wholly owned by one or more of the merging companies. The decree nisi recites that the merger involved "sixty-four so-called underliers." The scope of operation (excluding facilities owned by the city and by Delaware River Joint Commission) appears from the finding of the commission of 600 miles of surface track; 23 miles of subway-elevated track; nearly 400 miles of motorbus routes and about 5 1/2 miles of trackless trolley routes.
2 Subsection (e), subsection (2), of the United States Bankruptcy Code, 11 U.S.C.A. § 207.
3 The property was purged of many old and obsolete items. By December 1, 1941, 130 new surface cars of the most modern design, 50 trackless trolley cars, 323 new busses were added at a total cost of $7,120,000. 289 old passenger cars were modernized at a cost of $434,668. In addition there were on order for delivery in 1942, 110 new surface cars, 10 trackless trolley cars, and 100 busses costing $3,325,093.
4 Two wage increases became effective after the reorganization, one involving an additional annual operating cost of $1,500,000 and the other $500,000. The commission also refers to a demand for further increases in wages involving an additional annual expense of $2,500,000, then pending before the War Labor Board.
5 Cf. Public Utility Code of May 28, 1937, P.L. 1053, §§ 603, 918, 66 P. S. § 1243, 1358.
6 Compare present value with more than $200,000,000 approved inCity of Phila. v. Public Ser. Com., 84 Pa. Super. 135.
7 In addition to these lump franchise payments, made when the transportation system was electrified, the City of Philadelphia now exacts from the company an annual payment of nine hundred thousand dollars in lieu of paving repairs, and street maintenance. This amount represents twelve million fares at the present rate, (two fares for 15 cents), or thirty-three thousand fares which the company is required to pay daily to the city for the privilege of operating cars on its streets.
Contrast this with the situation in New York, where that city pays out of its municipal revenues, raised by taxation on real estate, etc., about thirty-seven million dollars annually to keep the fare on its street cars and subways down to five cents, instead of a fare commensurate with its cost.
8 In Federal Power Commission et al. v. Hope Natural Gas Co.,320 U.S. 591, 64 S. Ct. 281, 6 1/2% was approved as a fair rate of return in the light of the risks assumed. The business there was speculative because of the uncertainty of an available supply of natural gas; here the future uncertainty is the public demand for transportation. The allowance by the commission of a return of 6 1/2% in Peoples Nat. Gas Co. v. Pa. P.U.C., involving the same risks as in the Hope case, was approved by us in 153 Pa. Super. 475, 34 A.2d 375. Cf. Solar Electric Co. v. P.U.C., supra, p. 387; and discussion in United Rys. Electric Co. of Baltimorev. West, supra.
9 If we start with $77,000,000 as the commission's adjudication of value, an addition of at least $10,000,000, in view of the total of reproduction costs adopted by the commission, would appear to be reasonable, whether accrued depreciation be deducted from that cost in the amount found by the commission or the figure contended for by appellant. Additional cash working capital allowed by us and franchise paving increase the total to $93,049,000.
We have referred to the emphasis which appellant has placed upon the adjudication of $85,000,000 as total value in the reorganization case. Following reorganization, by agreement, an option was given the city to buy the entire transportation system at about that figure as adjusted by later additions and retirements. In that agreement between a willing seller and a prospective buyer there is some evidence that the city, an appellee here, as well as the appellant, considered $85,000,000 as approximating the then fair value of the property. Thus each of the three parties to this appeal has adopted $85,000,000 as the value of appellant's property at the time of reorganization. If we add $10,000,000 — the cost of equipment bought later, adjusted for property retired — we have additional support for our conclusion. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4523703/ | Electronically Filed
Intermediate Court of Appeals
CAAP-XX-XXXXXXX
08-APR-2020
08:01 AM | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523702/ | UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
ROBERT QUIGLEY et al.,
Plaintiffs,
v. Case No. 20-cv-00910 (TNM)
DISTRICT OF COLUMBIA,
Defendant.
MEMORANDUM OPINION
Plaintiffs Robert Quigley, Huei Lan Hsu, and Stacy Mongeon are three District of
Columbia residents. Appearing pro se, they seek review of the denial of their respective claim
for unemployment compensation by the District of Columbia Department of Employment
Services, in light of the labyrinthine Coronavirus Aid, Relief and Economic Security (CARES)
Act, which became law on March 27, 2020. For the following reasons, the Court concludes that
it lacks subject matter jurisdiction.
I.
On April 1, 2020, the D.C. Department of Employment Services denied each plaintiff’s
application for unemployment compensation based on ineligibility. See Compl. Exs. C, D, E.
Plaintiffs have until April 16, 2020, to request reconsideration of that decision. If no request is
made, the decision becomes final. Id. Plaintiffs allege that the “Federal Government is paying
the full amount of [their] claims and as such the District of Columbia is simply a conduit in
which those monies are paid to the plaintiffs.” Compl. ¶ 6. They seek “600 per week . . for a
period of four months . . . or $9,600 each for the full period.” Id. at ¶ 7.
1
II.
Federal courts are courts of limited jurisdiction, and it is “presumed that a cause lies
outside this limited jurisdiction.” Kokkonen v. Guardian Life Ins. Co., 511 U.S. 375, 377 (1994).
Federal “spending legislation” does not itself “confer enforceable rights.” Gonzaga Univ. v.
Doe, 536 U.S. 273, 279–82 (2002). In providing guidance on “the administration of and
eligibility criteria for state unemployment insurance (UI) programs” under the CARES Act, the
Department of Labor has explained:
Under the Federal Pandemic Unemployment Compensation
program eligible individuals who are collecting certain
[unemployment insurance] benefits, including regular
unemployment compensation, will receive an additional $600 in
federal benefits per week for weeks of unemployment ending on or
before July 31, 2020. Additionally, the Pandemic Emergency
Unemployment Compensation (PEUC) program allows those who
have exhausted benefits under regular unemployment compensation
or other programs to receive up to 13 weeks of additional benefits.
States must offer flexibility in meeting PEUC eligibility
requirements related to “actively seeking work” if an applicant’s
ability to do so is impacted by COVID-19.
https://www.dol.gov/newsroom/releases/eta/eta20200402-0 (last visited Apr. 7, 2020). In short,
unemployment compensation decisions still remain with the states. And under District of
Columbia law, final decisions of the Department of Employment Services are reviewed by the
District of Columbia Court of Appeals “in accordance with the District of Columbia
Administrative Procedure Act,” not by this Court. D.C. Code § 51-112; Barnett v. D.C.
Dep’t of Employment Servs., 491 A.2d 1156, 1158 (D.C. 1985). 1
Accordingly, this case will be dismissed for want of jurisdiction. See Fed. R. Civ. P.
12(h)(3) (requiring that if a court finds “at any time that it lacks subject-matter jurisdiction, the
1
There is of course no suggestion that these three District plaintiffs qualify for diversity jurisdiction when suing
their city government.
2
court must dismiss the action”). A separate Order will issue.
2020.04.08
17:24:59 -04'00'
Dated: April 8, 2020 TREVOR N. McFADDEN
United States District Judge
3 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/4523705/ | Missouri Court of Appeals
Southern District
Division One
CONNIE SANDERS-FORD, )
)
Appellant, )
) No. SD36169
)
STATE OF MISSOURI, ) FILED: April 8, 2020
)
Respondent. )
APPEAL FROM THE CIRCUIT COURT OF McDONALD COUNTY
Honorable Timothy W. Perigo, Judge
AFFIRMED
Connie Sanders-Ford (“Movant”) was found guilty by a jury of first-degree murder and
armed criminal action for which she was sentenced, respectively and concurrently, to life in
prison without parole and three-years in prison. 1 Movant timely filed both a pro se and an
amended Rule 29.15 motion for post-conviction relief. 2 In the latter, Movant claimed, among
others, that she received ineffective assistance of counsel (“IAC”) in rejecting the State’s pre-
trial plea offer for a 25-year sentence for second-degree murder (the “plea offer”) and, instead,
proceeding to trial. Following an evidentiary hearing on her amended motion, the motion court
1
Movant’s convictions were affirmed by this court in State v. Sanders-Ford, 527 S.W.3d 223 (Mo.App. 2017).
2
All rule references are to Missouri Court Rules (2019).
1
entered its judgment denying Movant’s IAC claim related to the plea offer. Movant timely
appeals that denial.
The motion court found and concluded as follows:
In this point [M]ovant claims that … her trial counsel was ineffective for telling
her that she would have to serve 85% of her sentence if she accepted the state’s
offer of 25 years in prison on the reduced charge of murder in the second degree.
Movant’s trial counsel’s advice would have been accurate if [M]ovant was
younger, but Section 558.019(3) RSMo makes an exception for older
defendants.[ 3] Instead of being required to serve 85% of her sentence movant
would have been eligible for parole after serving just 40% of her sentence because
she would have been older than 70 years of age by then. At the hearing on this
motion, trial counsel admitted that he was unaware of this exception and was
therefore inaccurate in his advice to [M]ovant on this matter. However, during
the hearing on this motion the prosecutor in charge of the trial and plea bargain
offer stated that he was also unaware of the exception for older defendants found
in section 558.019(3). The prosecutor state [sic] that the plea offer was made with
the intent of both he and the victim’s family that [M]ovant never be released from
prison. The prosecutor also said that had the mistake been realized before
[M]ovant entered her plea to the lesser charge that the offer would have been
withdrawn. Movant has failed to prove that she was prejudiced by trial counsel’s
inaccurate advice because it is speculation that the prosecutor would not have
discovered his mistake before [M]ovant had an opportunity to enter her plea. At a
sentencing hearing on the proposed plea offer, most likely either the prosecutor or
the victim would have stated that [Movant] would have to serve 85% of the
sentence (assuming prosecutor had not yet discovered RSMo 558.019(3).
At this point, the Court being presumed to know the law would have corrected the
prosecutor.[ 4] Court believes the prosecutor’s statement that he would have
withdrawn the plea of guilty discovery [sic] of RSMo 558.019(3).
Applicable Legal Principles
This Court’s review of the denial of a Rule 29.15 motion for post-conviction relief is
limited to determining whether the motion court’s findings of fact and conclusions of law are
3
Section 558.019.3 RSMo (2016) provides:
Other provisions of the law to the contrary notwithstanding, any offender who has pleaded guilty
to or has been found guilty of a dangerous felony as defined in section 556.061 and is committed
to the department of corrections shall be required to serve a minimum prison term of eighty-five
percent of the sentence imposed by the court or until the offender attains seventy years of age, and
has served at least forty percent of the sentence imposed, whichever occurs first.
(Emphasis added.)
4
The motion court judge was also the trial court judge in the underlying criminal case.
2
clearly erroneous. Rule 29.15(k); Williams v. State, 168 S.W.3d 433, 439 (Mo. banc 2005).
Such “[f]indings and conclusions are clearly erroneous only if a full review of the record
definitely and firmly reveals that a mistake was made.” Morrow v. State, 21 S.W.3d 819, 822
(Mo. banc 2000). It is incumbent upon the movant in a post-conviction motion to prove his or
her claims for relief by a preponderance of the evidence, Rule 29.15(i), and this Court presumes
that the motion court’s findings and conclusions are correct, Wilson v. State, 813 S.W.2d 833,
835 (Mo. banc 1991). “The trial court has the ‘superior opportunity to determine the credibility
of witnesses,’ and this Court defers to the trial court’s factual findings and credibility
determinations.” Zink v. State, 278 S.W.3d 170, 178 (Mo. banc 2009) (quoting State v. Rousan,
961 S.W.2d 831, 845 (Mo. banc 1998)).
In order to prove a claim that counsel’s assistance was ineffective, the movant must
demonstrate (1) that counsel’s representation failed to conform to the degree of skill, care, and
diligence of a reasonably competent attorney rendering similar services under similar
circumstances (performance prong); and (2) that the movant was prejudiced as a result of
counsel’s failure (prejudice prong). Strickland v. Washington, 466 U.S. 668, 687 (1984);
Sanders v. State, 738 S.W.2d 856, 857 (Mo. banc 1987). In reviewing such claims, we are not
required to examine both prongs; if a movant fails to satisfy the performance prong, we need not
consider the prejudice prong, and vice versa. Sanders, 738 S.W.2d at 857.
To show prejudice from ineffective assistance of counsel where a plea
offer has lapsed or been rejected because of counsel’s deficient performance,
defendants must demonstrate a reasonable probability they would have accepted
the earlier plea offer had they been afforded effective assistance of counsel.
Defendants must also demonstrate a reasonable probability the plea would have
been entered without the prosecution canceling it or the trial court refusing to
accept it, if they had the authority to exercise that discretion under state law. To
establish prejudice in this instance, it is necessary to show a reasonable
probability that the end result of the criminal process would have been more
favorable by reason of a plea to a lesser charge or a sentence of less prison time.
3
Missouri v. Frye, 566 U.S. 134, 147 (2012). “[A]s a general rule, Missouri law permits the State
discretion to withdraw a plea offer, even an accepted plea offer, at any time prior to the offer’s
acceptance by the trial court.” Frye v. State, 392 S.W.3d 501, 506 (Mo.App. 2013). Similarly,
subject only to constraints or limitations imposed by Rule 24.02(d), a Missouri trial court has
discretion to accept or reject a plea agreement based on the State’s plea offer. Id. at 507.
In Missouri, therefore, in order to prove the Strickland prejudice prong where a plea offer
has lapsed or been rejected based upon alleged IAC, a movant must demonstrate a reasonable
probability that (Step 1) Movant would have accepted the earlier plea offer had he or she been
afforded effective assistance of counsel, (Step 2) Movant’s plea would have been entered (a)
without the prosecution canceling it or (b) the trial court refusing to except it, and (Step 3) the
end result of the criminal process would have been more favorable by reason of a plea to a lesser
charge or a sentence of less prison time. Frye, 566 U.S. at 147. Because the existence of all
three steps is required to establish Strickland prejudice for an IAC claim in this context, a
movant’s failure to prove any one step necessarily defeats the IAC claim.
Discussion
In her sole point, Movant contends that the motion court clearly erred in denying her IAC
claim in rejecting the State’s plea offer because of plea counsel’s deficient performance in
misadvising her on parole eligibility and that she was prejudiced as a result because she “would
have accepted the state’s plea offer [Step 1], would have pled guilty to second-degree murder
[Step 2], and would have been subject to no more than a total sentence of 25 years rather than the
sentence of life without parole she is now serving [Step 3].”
For the purpose of resolving this appeal, we assume, without deciding, that plea counsel’s
performance was deficient (performance prong), that Movant, if accurately advised, would have
accepted the State’s plea offer (Step 1 of prejudice prong), and that the end result would have
4
been more favorable to Movant (Step 3 of prejudice prong). Movant, nevertheless, has failed to
demonstrate any clear error in the motion court’s finding that Movant failed to demonstrate a
reasonable probability that her plea would have been entered (Step 2 of prejudice prong) because
(a) the State would have withdrawn the offer before Movant would have pleaded guilty and (b),
if not withdrawn, the trial court would have rejected the plea agreement based upon the plea
offer.
In her argument under this point, Movant describes the challenged motion court findings
as “it is likely that the issue of 40% parole eligibility would have been discovered and the offer
would have been withdrawn by the prosecutor” and “the trial court would have rejected the plea
deal[.]” She argues these “findings” are based only upon speculation and are not supported by
anything in the record. This argument is misplaced, however, because it does not address the
actual motion court finding and ignores both Movant’s burden to prove prejudice, see Rule
29.15(i), and our standard of review requiring a determination of clear error in the motion court’s
finding that Movant failed to carry that burden, see Rule 29.15(k).
The motion court actually found that “Movant has failed to prove that she was prejudiced
by trial counsel’s inaccurate advice because it is speculation that the prosecutor would not have
discovered his mistake before [M]ovant had an opportunity to enter her plea.” (Emphasis
added.) Movant does not mention or specifically challenge this explicit motion court finding in
her point or her argument under this point. This finding is presumed correct, Wilson, 813
S.W.2d at 835, and on appeal a Movant must demonstrate that it is clearly erroneous, Rule
29.15(k), giving deference to the motion court’s credibility determinations, Zink, 278 S.W.3d at
178. In addition, Movant does not mention or challenge the prosecutor’s statements the motion
court relied upon and found credible in making this finding. Moreover, Movant directs us to no
5
evidence in the record contrary to this finding purporting to support her burden to demonstrate a
reasonable probability that the prosecutor was not mistaken or would not have discovered his
mistake and, in either event, would not have cancelled the offer before her plea was entered,
much less that the trial court found that contrary evidence credible.
The totality of Movant’s argument as to the prosecutor’s discovery of his mistake
consists of the following speculation, unconstrained by any citation to the record on appeal:
…even if the court had inquired of [Movant] as to whether she was aware that she
would be required to serve 85%, counsel could have cautioned [Movant] about
the issue so that she could have responded in such a manner that would not have
disclosed to the prosecutor that she would actually be eligible after only 40%.
Assuming the court would have even inquired about the parole consequences and
the 85% requirement, if prepared properly, [Movant] could have responded to
such an inquiry with a response such as, “I am aware of the 85% requirement.”
Such a response would have most likely not raised any suspicion and would have
been sufficient for the court’s inquiry.
Movant’s total reliance on speculation in her appellate argument reinforces, rather than
undermines, the motion court’s finding that Movant’s prejudice claim was based only on
speculation.
Similarly, Movant’s argument challenging, as she describes it, the motion court’s finding
“that the trial court would have rejected the plea deal” is nothing more than speculation, once
again unconstrained by any citations to the record on appeal. Movant’s argument, in its entirety,
is “given the information the court would have had regarding the case when a plea deal would
have been presented to it, it is likely the court would have accepted a deal proffered by the
prosecution.” Nothing in this argument demonstrates any clear error by the motion court based
upon the record on appeal.
Having offered only speculation to this court in support of the second step of her
prejudice claim, Movant has failed to address, much less demonstrate, any mistake by the motion
court in finding she failed to prove that step of the prejudice prong of her IAC claim in rejecting
6
the plea offer. We, therefore, have no basis upon which to determine that the motion court
committed any clear error in making that finding or in denying Movant’s claim.
Decision
The motion court’s judgment is affirmed.
GARY W. LYNCH, P.J. – OPINION AUTHOR
NANCY STEFFEN RAHMEYER, J. – CONCURS
WILLIAM W. FRANCIS, JR., J. – CONCURS
7 | 01-03-2023 | 04-08-2020 |
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https://www.courtlistener.com/api/rest/v3/opinions/3856373/ | Argued October 3, 1935.
This is an action in trespass brought by Joseph J. Stadale, Jr., a minor, by his next friend and father, Joseph J. Stadale, and Joseph J. Stadale in his own right, for personal injuries and property damage suffered by Joseph J. Stadale, Jr., in a rear end collision of his car with the truck of the defendant at Broad and Jefferson Streets in the City of Philadelphia on July 5, 1933, at 6:30 A.M. daylight saving time. At the conclusion of the plaintiff's testimony, a non-suit was entered in favor of the defendant against Joseph J. Stadale, on account of the minor plaintiff being of full age and being the owner of the car.
According to the plaintiff's testimony, defendant's truck, travelling south, passed him on the right at a point approximately one hundred feet north of the intersection of Broad and Jefferson Streets, and drew ahead of him so that when the truck reached the intersection he, the plaintiff, was twenty feet to the rear thereof. He was proceeding at thirty miles per hour in the far left lane and the defendant's truck was in the extreme right lane; there being three southbound lanes altogether. *Page 366
With the vehicles in this position the truck, without warning, started to turn left into Jefferson Street, and, although plaintiff applied his brakes, he could not stop in time to avoid colliding with the left rear corner of defendant's truck.
According to the defendant's driver, he was proceeding in the left hand lane; as he approached Jefferson Street he slowed down to ten miles per hour, and had put out his hand when he was forty feet from the corner, and passed plaintiff on the latter's right.
Defendant offered in evidence two photographs taken five minutes after the accident by an officer attached to the Accident Investigation Department, which showed that when the cars came to a stop at the southeast corner of Broad and Jefferson Streets, the plaintiff's car was wedged into the rear of the defendant's truck.
The plaintiff, in a signed statement taken at the police station about an hour after the accident, stated that he had not seen the truck before he ran into it.
At the conclusion of the testimony, defendant's counsel presented a written point for binding instructions, which point the court refused.
The jury rendered a verdict for the plaintiff, Joseph J. Stadale, Jr., and assessed damages at $400. Subsequently, defendant moved for judgment non obstante veredicto, which motion was refused. From the judgment entered on the verdict, this appeal was taken.
The only assignments of error relate to the refusal of binding instructions for defendant and the refusal of motion for judgment n.o.v. In the disposition of this appeal the testimony and proper inferences therefrom must be considered in the light most favorable to plaintiff: Lelar v. Quaker City Cabs, 108 Pa. Super. 15, 164 A. 105. The verdict of the jury establishes the negligence of defendant's driver and the want of contributory negligence on the part of the plaintiff.
Appellant contends that plaintiff was guilty of contributory *Page 367
negligence as a matter of law, for the reason that the point of collision as fixed by the plaintiff was in the lane in which he was traveling, and the point of contact was the left rear of the truck as it was turning. Appellant relies on the Act of May 1, 1929, P.L. 905, Art. X, Sec. 1002, as amended, and cites the case of Lelar v. Quaker City Cabs, supra, in support of his position. That act provides, inter alia, as follows: "No person shall drive any vehicle upon a highway at such a speed as to endanger the life, limb, or property of any person, nor at a speed greater than will permit him to bring the vehicle to a stop within the assured clear distance ahead." There is no question concerning the duty of one driving a car in the rear of a car preceding him to so regulate the speed of his car as to prevent a rear end collision: Zandras v. Moffett, 286 Pa. 477, 133 A. 817; Lang et al. v. Hanlon et al., 302 Pa. 173, 153 A. 143; McIlhenny v. Baker, 63 Pa. Super. 385; Cormican v. Menke, 306 Pa. 156,159 A. 36; Milliken v. United Laundries, 105 Pa. Super. 286,161 A. 873. That act, however, has no application under the facts of the instant case. Plaintiff, with an admittedly clear view of the empty crossing, had no reason to expect that his path would be blocked. He was maintaining his rate of thirty miles per hour, and was not bound to anticipate any negligent act on the part of the defendant's driver: Weiss v. Pittsburgh Railways Co.,301 Pa. 539, 152 A. 674. In addition, the violation of a statute by one suing for personal injuries is not contributory negligence, unless it is shown to have been the proximate cause of the injury: Lane v. E.A. Mullen, Inc., 285 Pa. 161,131 A. 718; Miller v. Southern Asphalt Co., 314 Pa. 289, 171 A. 472. Plaintiff testified that no signal was given by defendant's driver before attempting to make the turn, and while this was denied by the latter, the case presented a question *Page 368
for the jury. The case was submitted in a fair and impartial charge to which no exception was taken.
Appellant further contends that the physical facts defeat plaintiff's right to recover, relying upon the photographs which were offered in evidence, showing plaintiff's car wedged in under the rear of defendant's truck. These photographs were taken five minutes after the collision and away from the point of impact. The rule invoked has no application to moving objects.
All of the cases cited by appellant are readily distinguishable from the instant case.
The assignments of error are overruled and judgment affirmed. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/4523710/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
__________________
NO. 09-18-00318-CR
__________________
NELSON MAURICIO SEGOVIA-AMAYA, Appellant
V.
THE STATE OF TEXAS, Appellee
__________________________________________________________________
On Appeal from the 9th District Court
Montgomery County, Texas
Trial Cause No. 16-12-14898-CR
__________________________________________________________________
MEMORANDUM OPINION
A jury convicted appellant Nelson Mauricio Segovia-Amaya of murder, and
the trial judge assessed punishment at confinement for life. See Tex. Penal Code
Ann. § 19.02. In three issues, Segovia-Amaya argues that (1) his sentence constitutes
cruel and unusual punishment, and the trial court erred by denying his motion for
new trial because (2) the jury was improperly instructed, and (3) the challenged
instruction, which was based upon article 37.07, § 2(a) of the Texas Code of
1
Criminal Procedure, unconstitutionally shifted the burden of proof to Segovia-
Amaya. We affirm the trial court’s judgment.
ISSUE ONE
In his first issue, Segovia-Amaya argues that his sentence of life imprisonment
constituted cruel and unusual punishment and is grossly disproportionate to the
offense in violation of the U.S. and Texas constitutions. See U.S. Const. amend. VIII;
Tex. Const. art. I, § 13. Generally, a sentence that is within the range of punishment
established by the Legislature is not excessive, cruel, or unusual, and will not be
disturbed on appeal. State v. Simpson, 488 S.W.3d 318, 323 (Tex. Crim. App. 2016);
Jackson v. State, 680 S.W.2d 809, 814 (Tex. Crim. App. 1984). Rarely will an
appellate court consider a punishment range for the offense excessive,
unconstitutionally cruel, or unusual under either Texas law or the United States
Constitution. See Kirk v. State, 949 S.W.2d 769, 772 (Tex. App.—Dallas 1997, pet.
ref’d); see also Jackson v. State, 989 S.W.2d 842, 846 (Tex. App.—Texarkana 1999,
no pet.). An exception to this general rule is recognized when the sentence is grossly
disproportionate to the offense. Solem v. Helm, 463 U.S. 277, 289-90 (1983). With
the exception of cases involving capital punishment, successful challenges to the
proportionality of particular sentences are exceedingly rare. Id.
2
In determining whether a sentence is grossly disproportionate to a particular
defendant’s crime, we consider (1) the severity of the sentence in light of the harm
caused to the victim; (2) the defendant’s culpability; and (3) the defendant’s prior
adjudicated and unadjudicated offenses. Simpson, 488 S.W.3d at 323. In the rare
case in which this threshold comparison leads to an inference of gross
disproportionality, we then compare the defendant’s sentence with the sentences of
other offenders in Texas and with the sentences imposed for the same crime in other
jurisdictions. Id. “If this comparative analysis validates an initial judgment that the
sentence is grossly disproportionate, the sentence is cruel and unusual.” Id.
Murder is a first-degree felony offense, which carries a punishment range of
confinement for life or for any term of not more than ninety-nine years or less than
five years. Tex. Penal Code Ann. §§ 12.32(a), 19.02(c). In addition to imprisonment,
a first-degree felony may also be punished by a fine not to exceed $10,000. Id. §
12.32(b). As discussed above, the trial judge assessed Segovia-Amaya’s punishment
at confinement for life. The trial judge did not impose a fine. Segovia-Amaya
testified that he shot the victim, but he explained that the victim had a gun and had
previously threatened him, and he believed the victim intended to shoot him.
Segovia-Amaya testified that he fled the scene after the shooting. A forensic
pathologist testified that the victim was shot seven times, and the cause of the
3
victim’s death was multiple gunshot wounds. Evidence was also introduced in the
punishment phase that Segovia-Amaya had previously been convicted of driving
while intoxicated and two charges of failure to identify himself to a police officer.
Having reviewed the entire record, we cannot conclude that this is one of those
rare cases that leads to the inference that the sentence imposed was cruel and unusual
or grossly disproportionate to the offense. See Solem, 463 U.S. at 289-90; Simpson,
488 S.W.3d at 323; see also Kirk, 949 S.W.2d at 772. Accordingly, we overrule issue
one.
ISSUE TWO
In issue two, Segovia-Amaya contends the trial court erred by denying his
motion for new trial because the jury was improperly charged that its sole duty was
to “determine the guilt or innocence of the Defendant under the indictment[.]”
Segovia-Amaya notes that article 37.07, § 2(a) of the Texas Code of Criminal
Procedure requires the trial court to “submit to the jury the issue of guilt or innocence
of the defendant[,]” and he notes that although both the challenged instruction and
article 37.07, § 2(a) use the phrase “guilt or innocence[,]” the trial court had “no
apparent reason” to have tracked the statutory language from article 37.07, § 2(a).
In addition, Segovia-Amaya asserts that “[t]he argument that ‘tracking’ article 37.07,
§ 2(a) cures the error is disingenuous[,] and it disregards . . . article 37.07(b), § 1(b),
4
which specifically instructs that” if a defendant pleads not guilty, jurors must find
that the defendant is either guilty or not guilty.
When reviewing alleged charge error, we determine whether error existed in
the charge and, if so, whether sufficient harm resulted from the error to compel
reversal. Ngo v. State, 175 S.W.3d 738, 744 (Tex. Crim. App. 2005). If no error
occurred, our analysis ends. See Kirsch v. State, 357 S.W.3d 645, 649 (Tex. Crim.
App. 2012). If, as here, the defendant does not object to the alleged charge error at
trial, we may reverse the judgment only if the error is so egregious that the defendant
did not receive a fair and impartial trial. Almanza v. State, 686 S.W.2d 157, 171
(Tex. Crim. App. 1984) (op. on reh’g); see also Herron v. State, 86 S.W.3d 621, 632
(Tex. Crim. App. 2002). Even if alleged jury-charge error was raised in a motion for
new trial, unpreserved jury-charge error does not require a new trial unless the error
caused egregious harm. Ngo, 175 S.W.3d at 743-44; Almanza, 686 S.W.2d at 171.
In assessing the degree of harm, we must consider the entire jury charge, the state of
the evidence, the argument of counsel, and any other relevant information revealed
by the record. Almanza, 686 S.W.2d at 171. We must examine the charge in its
entirety rather than a series of isolated statements. Holley v. State, 766 S.W.2d 254,
256 (Tex. Crim. App. 1989); Iniguez v. State, 835 S.W.2d 167, 170 (Tex. App.—
Houston [1st Dist.] 1992, pet. ref’d). “Egregious harm is a difficult standard to prove
5
and such a determination must be done on a case-by-case basis.” Hutch v. State, 922
S.W.2d 166, 171 (Tex. Crim. App. 1996).
Some of our sister courts have concluded that a jury instruction like the
instruction Segovia-Amaya challenges is not erroneous. See Avila v. State, 15
S.W.3d 568, 576-77 (Tex. App.—Houston [14th Dist.] 2000, no pet.); Flores v.
State, 920 S.W.2d 347, 357 (Tex. App.—San Antonio 1996), pet. dism’d,
improvidently granted, 940 S.W.2d 660 (Tex. Crim. App. 1996); Barnes v. State,
855 S.W.2d 173, 175 (Tex. App.—Houston [14th Dist.] 1993, pet. ref’d). The
instruction is designed to draw the jury’s attention to the first phase of a bifurcated
criminal trial (the guilt-innocence phase) and to direct the jury away from
considering other issues, including punishment. See Barnes, 855 S.W.2d at 175. In
this case, the jury charge instructed the jury that (1) “[a]ll persons are presumed to
be innocent and no person may be convicted of an offense unless each element of
the offense is proved beyond a reasonable doubt[;]” (2) “[t]he law does not require
a Defendant to prove his innocence or produce any evidence at all[;]” and (3) “[t]he
prosecution has the burden of proving the Defendant guilty and it must do so by
proving each and every element of the offense charged beyond a reasonable
doubt[,]” and “[i]f it fails to do so, you must acquit the Defendant.”
6
Segovia-Amaya acknowledges the holdings of our sister courts regarding the
complained-of instruction, and he also argues that the pattern jury charges have
“changed since 1975 and . . . the current version has replaced ‘guilt or innocence’
with ‘Your sole duty at this point is to determine whether the defendant has been
proved guilty.” See State Bar of Texas, Texas Criminal Pattern Jury Charges—
General, Evidentiary & Ancillary Instructions, § 2.1 (2015). Segovia-Amaya did not
cite any authorities that require this Court to find that the trial court erred by using
language that differed from the language contained in the pattern jury charge, nor
are we are aware of any. See Tex. R. App. P. 38.1(i). The pattern jury charges are
“suggestions and guides” that “have no official status.” State Bar of Texas, Texas
Criminal Pattern Jury Charges—General, Evidentiary & Ancillary Instructions,
Introduction. “Appellate courts are unlikely to regard trial judges’ refusal to use the
Committee’s jury instructions as reversible error.” Id. We conclude that the trial
court’s instruction was not erroneous. Although we need not determine whether any
harm resulted because we have found no error, we further conclude that even if the
trial court’s instruction were erroneous, Segovia-Amaya has not established
egregious harm. Having examined the entire jury charge, the state of the evidence,
the argument of counsel, and any other relevant information revealed by the record,
we cannot conclude that the error was so egregious as to deny Segovia-Amaya a fair
7
and impartial trial. See Almanza, 686 S.W.2d at 171. Accordingly, we overrule issue
two.
ISSUE THREE
In issue three, Segovia-Amaya argues that the trial judge erred by denying his
motion for new trial because the complained-of instruction, which was based upon
article 37.07, § 2(a), unconstitutionally shifted the burden of proof to him.
Specifically, Segovia-Amaya asserts that article 37.07, § 2(a) of the Texas Code of
Criminal Procedure is unconstitutional as applied to him, and he maintains that the
use of the statute in his case violated due process by unconstitutionally shifting the
burden of proof to him. Segovia-Amaya did not make this argument during the trial,
but he did make the argument in his motion for new trial.
An as-applied constitutional challenge must be raised in the trial court to
preserve error. Reynolds v. State, 423 S.W.3d 377, 383 (Tex. Crim. App. 2014);
Flores v. State, 245 S.W.3d 432, 437 n. 14 (Tex. Crim. App. 2008). Segovia-Amaya
failed to raise an objection at trial regarding his contention that the statute operated
unconstitutionally as applied to him. When reviewing a challenge to the
constitutionality of a statute, we presume that the statute is valid and that the
Legislature acted reasonably in enacting it. Faust v. State, 491 S.W.3d 733, 743-44
(Tex. Crim. App. 2015). The party challenging the constitutionality of a statute bears
8
the burden of establishing that the statute in question is unconstitutional as applied
to him. See Schlittler v. State, 488 S.W.3d 306, 313 (Tex. Crim. App. 2016). To
resolve an as-applied challenge requires a recourse to evidence, and the party
challenging the statute must produce evidence that specifically demonstrates that the
complained-of statute is unconstitutional as applied to him. See Estes v. State, 546
S.W.3d 691, 698 (Tex. Crim. App. 2018).
As discussed in our analysis of issue two, we concluded that the trial court’s
inclusion of language from article 37.07, § 2(a) of the Texas Code of Criminal
Procedure was neither erroneous nor egregiously harmful. Segovia-Amaya failed to
lodge an “as-applied” challenge or objection at trial, and he failed to produce
evidence with his motion for new trial that specifically demonstrated that the statute
operated unconstitutionally as to him or that he was denied due process. See id.;
Faust, 492 S.W.3d at 743-44. As previously discussed, the trial court clearly and
explicitly instructed the jury regarding the State’s burden of proving the charge
beyond a reasonable doubt and the presumption of Segovia-Amaya’s innocence.
Nothing in the record before us suggests a reasonable likelihood that the jury was
confused by the complained-of instruction, and Segovia-Amaya does not point us to
any such evidence. For the same reasons explained above, we reject Segovia-
Amaya’s argument that the inclusion of the complained-of instruction denied him
9
due process. We conclude that Segovia-Amaya did not meet his burden of
specifically demonstrating that article 37.07, section 2(a) of the Texas Code of
Criminal Procedure is unconstitutional as applied to him. See Estes, 546 S.W.3d at
698. Accordingly, we overrule issue three. Having overruled each of Segovia-
Amaya’s issues, we affirm the trial court’s judgment.
AFFIRMED.
_________________________
STEVE McKEITHEN
Chief Justice
Submitted on December 2, 2019
Opinion Delivered April 8, 2020
Do Not Publish
Before McKeithen, C.J., Kreger and Johnson, JJ.
10 | 01-03-2023 | 04-08-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/3856621/ | Argued October 5, 1949.
On November 19, 1948, the Trustees of Pittsburgh Railways Company and of Pittsburgh Motor Coach Company, a wholly owned subsidiary of Pittsburgh Railways Company, filed new tariffs to become effective December 20, 1948. The principal changes under the proposed tariffs were to increase the basic street car fare from 10 cents to 12 cents, and the fare for through bus service from 12 1/2 cents to 15 cents.
The City of Pittsburgh, on November 24, 1948, filed a complaint docketed at C. 14500 against the new rates as proposed by both companies.
The Commission, by orders dated December 14, 1948, suspended the effective date of the proposed tariffs from December 20, 1948, to June 20, 1949,1 and on the same date instituted inquiries and investigations against the existing and proposed rates of the two companies.
The Commission, by its order of January 10, 1949, upon motion of the City of Pittsburgh, consolidated for the purposes of hearing only the City's complaint at C. 14500 with the Commission's proceedings, C. 14540, C. 14541.
Previously the companies, on December 5, 1947, had filed new schedules of rates and fares which became effective January 5, 1948, increasing the basic fare from 8 1/3 cents to 10 cents.
On June 15, 1949, the Commission issued its orders (1) finding that the existing rates for rail, incline plane, and bus service were not producing an excessive return, and that the proposed rates for such service would not produce an excessive return, and accordingly terminated *Page 523
its inquiries and investigations as of June 19, 1949, and (2) dismissing the complaint of the City of Pittsburgh. The City appealed from these orders of the Commission on June 18, 1949, and on July 7, 1949, this Court ordered that the appeals should operate as a supersedeas.
The Pittsburgh Railways Company, hereinafter referred to as "Railways," has an intricate corporate set-up. Ownership of the railway and incline plane properties operated by Railways is vested in part in Railways and in part in 53 street railway and incline plane underliers. The properties of the latter are operated by Railways under lease agreements with the underliers. The Pittsburgh Motor Coach Company, hereinafter referred to as "Motor Coach," is a wholly owned subsidiary of Railways. Motor Coach owns and operates all bus facilities. Certain of the bus facilities are used as feeder and shuttle lines with respect to rail operations, and the operation of these bus lines by Motor Coach is for the account of Railways. The balance of the bus operations is for certain through routes operating between downtown Pittsburgh and suburban areas. These routes are a separate operation from all transportation facilities of the two companies, and constitute a minor part of the over-all operation.2
Railways and Motor Coach furnish a coördinated street railway-bus service in the City of Pittsburgh and in 89 surrounding communities, having an approximate combined population of 1,400,000. *Page 524
Both Railways and its wholly owned subsidiary, Motor Coach, are debtors under the Federal Bankruptcy Act, and have been operated since June 14, 1938, by trustees appointed by the United States District Court.
These appeals by the City of Pittsburgh do not involve any question of confiscation of the property of the utilities. However, we may set aside the orders of the Commission and remand the record for "error of law or lack of evidence to support the finding, determination, or order of the commission . . ." Section 1107 of the Act of May 28, 1937, P. L. 1053, as amended by the Act of July 3, 1941, P. L. 267, § 3, 66 P. S. § 1437; Pittsburgh v. Pennsylvania Public Utility Commission,158 Pa. Super. 229, 235, 44 A.2d 614, 616.
The Commission found that the fair value of Railways for rate making purposes was $50,000,000. A 6 1/2 per cent rate of return was allowed by the Commission. This rate applied to the finding of fair value would entitle Railways to receive an annual return of $3,250,000.3
Railways presented to the Commission three measures of value as of December 31, 1947. Railways gave $45,558,764 as depreciated original cost of its used and useful street railway, incline, and bus property. The Commission accepted Railways' original cost new determination as of December 31, 1947, as well as net additions to property accounts during the year 1948. Railways' depreciated reproduction cost figure for its property was $60,661,763. The third measure of value submitted by Railways was "reproduction cost new and less accrued depreciation based upon prices current as of December 31, 1947." The Commission refused to give consideration to this measure of value submitted by Railways for the reason that such reproduction cost at prices *Page 525
current at December 31, 1947, was not based upon the fair average price of materials, property, and labor as required by law. See Equitable Gas Co. v. Pennsylvania Public UtilityCommission, 160 Pa. Super. 458, 466, 51 A.2d 497; BlueMountain Telephone and Telegraph Co. v. Pennsylvania PublicUtility Commission, 165 Pa. Super. 320, 327,67 A.2d 441.
The Commission, accepting five year average prices for the years 1943-1947 used by Railways, determined the depreciated reproduction cost as of December 31, 1948, at $57,244,140. But the Commission condemned the use of five year average prices covering 1943-1947 as follows: "With respect to this reproduction cost estimate, Railways has used five year average prices 1943-1947, a period embracing relatively high price levels. We believe, because of the impact of World War II, that an average of prices prevailing during the 10 years ended December 31, 1947, would have been more representative of the fair average price of materials, property and labor contemplated in the Public Utility Law." Notwithstanding its disapproval of five year average prices and its conclusion that they were unrepresentative, the Commission gave weight in determining the rate base to reproduction cost based on such averages. Either five year average prices were representative and entitled to be used in a finding of reproduction cost in this case or they were not. The weight to be given by the Commission to a reproduction cost finding is another matter. As this Court stated in Equitable Gas Co. v. Pennsylvania PublicUtility Commission, supra, 160 Pa. Super. 458, 466,51 A.2d 497, 502: "It would be futile to attempt to determine fairly reproduction cost in an abnormal price situation. Reproduction cost under ordinary circumstances and reasonably stable prices is a theoretical value based upon uncertain and fugitive data. But the commission is not obliged to accept such estimates which would increase such theoretical value *Page 526
where the economic conditions are uncertain and unstable. Such weight as the estimate may have depends largely upon the stability of the price level over a period of years. We do not believe that under any theory appellant is entitled to a finding of reproduction cost new or depreciated reflecting highly inflationary prices which are probably of temporary duration."
The Commission found the depreciated original cost of Railways' property as of December 31, 1948, to be $43,478,904. Original cost as of December 31, 1948, was fixed at $72,378,904, and the accrued depreciation at $28,900,000, leaving a depreciated original cost of $43,478,904.4 From the reproduction cost figure of $104,294,932 based on five year average prices 1943-1947, with net additions during 1948 of $149,208, the Commission deducted adjusted accrued depreciation of $47,200,000 giving a depreciated reproduction cost of $57,244,140.4 We recognize that accrued depreciation is essentially a judgment figure. Schuylkill Valley Lines, Inc.,v. Pennsylvania Public Utility Commission, 165 Pa. Super. 393,68 A.2d 448. However, in considering the question of accrued depreciation, the Commission stated that Railways had failed to give proper consideration to the element of obsolescence. The Commission pointed out that, according to a survey made by an engineering firm, Railways' Exhibit 81A, a net decrease in depreciated original cost of over $2,000,000 could be brought about by abandonment of certain rail lines and the substitution of bus service therefor. The Commission also, in its report and order, states that in its reorganization plan, which was before the Commission and submitted of record by reference in the instant proceedings, Railways proposed the complete abandonment of thirteen and the partial abandonment of four street railway routes, involving a total original cost as of December *Page 527
31, 1940, of approximately $4,770,000. And yet the Commission made no findings as to obsolescence, a factor which it recognized would be of much importance in the final determination of fair value. This Court has frequently referred to the importance of obsolescence as an element in determining accrued depreciation; this is especially true in the case of street railway transportation systems. Solar Electric Co. v.Pennsylvania Public Utility Commission, 137 Pa. Super. 325,366, 367, 9 A.2d 447; Philadelphia Transportation Co. v.Pennsylvania Public Utility Commission, 155 Pa. Super. 9,18, 37 A.2d 138. Cf. Blue Mountain Telephone and Telegraph Co.v. Pennsylvania Public Utility Commission, supra, 165 Pa. Super. 320,325, 67 A.2d 441.
It is to be noted that this is the second recent increase in rates by Railways. As of November, 1947, the patrons of Railways paid an 8 1/3 cent fare for street railway travel; an increase to 10 cents was made on January 5, 1948. And under the new tariffs the basic fare is to be 12 cents. This is an approximate increase of 50 per cent in transportation costs to the public in less than two years. It is evident that a point will be reached, if such is not already the case, where an increase in fares will yield less rather than greater net return. The Commission in its brief in the present appeals has said: "It goes without saying that, if the cost of labor and materials continue to rise, and if transportation costs become disproportionate to other costs resulting fares may become so high that the law of diminishing return may become accelerated and the riding public might well seek other forms of transportation." As stated in Peoples Natural Gas Co. v.Pennsylvania Public Utility Commission, 153 Pa. Super. 475,502, 34 A.2d 375, 388: "When rates are increased above a certain maximum, the public is apt to turn to competitors or so curtail their *Page 528
consumption that the net result is a loss rather than a gain to the utility."
The property of a public utility is still private property, but it is property devoted to the public service and impressed with a public interest. United Railways Electric Co. ofBaltimore v. West, 280 U.S. 234, 50 S. Ct. 123, 74 L. Ed. 390. A public utility occupies a quasi public or quasi trustee position; and the rates to be paid by the public for the service rendered, which are intended to produce a fair return on the fair value of the used and useful property of a utility, must bear a relationship to the obligations which flow from such public status. "Every rate made, demanded, or received by any public utility, . . . shall be just and reasonable, and in conformity with regulations or orders of the commission": Section 301 of the Public Utility Law of May 28, 1937, P. L. 1053, as amended by the Act of March 21, 1939, P. L. 10, No. 11, § 2, 66 P. S. § 1141. The Commission may indicate its judgment as to a proper schedule of rates. See Pennsylvania Power Light Co. v. Public Service Commission, 128 Pa. Super. 195,221, 193 A. 427.
It is a matter of common knowledge that the street railway systems of both Pittsburgh and Philadelphia have experienced substantial decline in gross revenues during the current calendar year of 1949. It is not apparent what part of this decline is due to consumer resistance to higher fares as compared to other causes. The Commission has frequently had occasion, in other cases which have come before this Court on appeal, to refer to the factor of consumer resistance to rate increases and to the law of diminishing returns as applied to such increases. In the present case Railways used 5 per cent to cover estimated loss in revenue due to decreased patronage resulting from consumer resistance to the proposed increased fares. The Commission reduced this estimate to 4.12 per cent in estimating *Page 529
the future effect of the proposed fares. In any event, it is clear that the area of increased net return resulting from increased rates to the consumer is limited. In the present case, the proposed increased rates would yield an estimated amount of $3,353,618 above the gross revenue of $25,007,768 for 1948, making an estimated total gross revenue under the proposed increase of $28,361,386. It will serve no purpose to continue to increase rates to a point higher than the public will pay. Capital, labor, and the public will each have to bear a share of the burden resulting from inflated prices and costs if the utility is to survive. But it is apparent from this record that Railways' operating revenues, under the present rates, scarcely meet the operating expenses as found by the Commission. The operating revenues for 1948 under the existing rates were $25,007,768, and the operating expenses were $24,646,476, leaving income available for return of $361,292. The estimated operating revenues for 1949 under the proposed rates are $28,361,386, and the allowable operating expenses are $25,065,276, which would leave income available for return of $3,296,110. The through route operating revenues given by Motor Coach for 1948 were $1,179,226, and operating expenses $1,292,973; for 1949 the estimated revenue under the proposed rates is $1,297,872, and operating expenses $1,272,073. These figures are basically those of Railways and Motor Coach. Accepting the facts as disclosed by the record and as found by the Commission, it is obvious that the utilities are entitled to some increase in revenue in order for them to properly discharge their public duties.
We think there is merit in the statement of the City of Pittsburgh that the increase of the basic fare places an undue burden on short haul riders.5 The City states that no comprehensive studies have been made as to zoning, *Page 530
or as to the more equitable distribution of transportation costs through the elimination of free transfers and the substitution of paid transfers. Commissioner Scragg, in his concurring opinion in the present case, aptly said: "Operators of urban transit companies should begin to recognize the fact that they are engaged in the business of mass transportation, and that when they get their rates above a base of 10 cents they are approaching the rates charged for luxury transportation and will inevitably price themselves out of the transportation market. They should cut their cloth to fit the pattern or the economics of the situation will do it for them and ultimately force them out of business. Constantly increasing rates is not the answer to the problem. Possibly rates proportioned to the distance traveled may be the answer." Even though the proposed rates may not produce an excessive return, as stated in the Commission's order, they may, nevertheless, be unjustly discriminatory. See section 304 of the Act of May 28, 1937, P. L. 1053, 66 P. S. § 1144; BellTelephone Company of Pennsylvania v. Pennsylvania PublicUtility Commission, 135 Pa. Super. 218, 233, 5 A.2d 410. Apparently the distance traveled does not determine the rate under the new tariffs. There may be differences in transportation rates between classes of travel which do not constitute unreasonable discrimination prohibited by the Public Utility Law. Philadelphia v. Pennsylvania Public UtilityCommission, 164 Pa. Super. 96, 107, 63 A.2d 391;Carpenter v. Pennsylvania Public Utility Commission, 141 Pa. Super. 447,450, 15 A.2d 473; Alpha Portland Cement Co.v. Public Service Commission, 84 Pa. Super. 255. But we are unable to determine on the present record whether the discrimination in rates in the new tariffs is logical, reasonable, and within "`the flexible limit of judgment which belongs to the power to fix rates': Atlantic Coast Line v. N. Car. Corp. Com'n., 206 U.S. 1." See Philadelphia v. Pennsylvania *Page 531 Public Utility Commission, 162 Pa. Super. 425, 432,57 A.2d 613; Reading Coach Company v. Public Service Commission,125 Pa. Super. 493, 498, 190 A. 172.
The City complains of a 6 1/2 per cent rate of return allowed to Railways by the Commission. Railways claimed an annual return of 7 1/2 per cent of the fair value of its property. In this connection the Commission stated: "The claimed rate of return of 7 1/2 per cent is on the record merely as the opinion of Railways, and is unsupported by any statistics or record. We will allow Railways 6 1/2 per cent rate of return to be applied to our finding of fair value of $50,000,000."
Railways' claim for a 7 1/2 per cent return was based upon one specific form of capitalization as a reorganized entity, and, as the Commission said, is unsupported by any statistics or records. The rate of return should not be based merely upon policy. The rate allowable is a fact to be determined from the evidence like any other fact. Pennsylvania Power Light Co. v.Public Service Commission, supra, 128 Pa. Super. 195,214, 193 A. 427; Bluefield Water Works and Improvement Co. v.Public Service Commission, 262 U.S. 679, 692, 43 S. Ct. 675,67 L. Ed. 1176. As we said in Schuylkill Valley Lines, Inc., v.Pennsylvania Public Utility Commission, supra, 165 Pa. Super. 393,403, 68 A.2d 448, 454: "The rate of return is necessarily a variable depending on many factors; it should be adequate and may not be confiscatory. Solar Electric Co. v. Pennsylvania Public Utility Commission, supra, 137 Pa. Super. 325,388, 9 A.2d 447. . . ."
We are of the opinion that the Commission should receive further relevant evidence, if offered; that it make revised or further findings of fact as warranted by all the evidence; and that a schedule of rates and fares which are just, reasonable, and nondiscriminatory be fixed. The present record furnishes an inadequate basis *Page 532
for final disposition of this case, and therefore it will be returned to the Commission for further action on the subjects to which we have referred.
The order of supersedeas of July 7, 1949, will be terminated, and the new tariffs filed on November 19, 1948, by Railways and Motor Coach, or such rates as the Commission may legally prescribe, should become effective pending further action by the Commission and the ultimate determination of a proper rate schedule.
The orders of the Commission are vacated, and the record is remitted to the Commission for further action and proceedings not inconsistent with this opinion.
1 See section 308 (b), Art. III, of the Public Utility Law, May 28, 1937, P. L. 1053, 66 P. S. § 1148.
2 In the record Railways has included, as part of its property and results of operations, the property of Motor Coach devoted to feeder and shuttle service and the results of the operation thereof, thus limiting consideration of Motor Coach to the property and operations related to through bus operation. The depreciated original cost as of December 31, 1948, of the through route bus property of Motor Coach was found by the Commission to be $345,823, exclusive of an allowance for cash working capital, materials, and supplies in the amount of $50,000.
3 It is not clear from the record to what extent, if any, operating costs are affected by the involved corporate set-up of Railways, but the Commission recognizes in its brief, p. 39, that an accomplished reorganization may lower the rate base.
4 This is exclusive of allowance for materials, supplies, and cash working capital of $2,025,000.
5 These constitute largely single vehicle passengers in contrast to multiple vehicle or free transfer passengers. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/152569/ | 617 F.3d 977 (2010)
UNITED STATES of America, Appellee,
v.
Ishmael K. HARRIS, Appellant.
No. 09-3060.
United States Court of Appeals, Eighth Circuit.
Submitted: April 12, 2010.
Filed: August 9, 2010.
Rehearing and Rehearing En Banc Denied September 22, 2010.
*978 David S. Rauzi, Kansas City, MO, argued, for appellant.
Paul S. Becker, Asst. U.S. Atty., Kansas City, MO, argued (Beth Phillips, U.S. Atty., on the brief), for appellee.
Before RILEY, Chief Judge, COLLOTON and BENTON, Circuit Judges.
BENTON, Circuit Judge.
Ishmael Kedar Harris pled guilty to possession with intent to distribute less than 50 kilograms of marijuana in violation of 21 U.S.C. §§ 841(a)(1) and (b)(1)(D). He also pled guilty to being a felon in possession of a firearm in violation of 18 U.S.C. §§ 922(g)(1) and 924(e). He reserved the right to appeal the district court's[1] denial of his motion to suppress evidence. Having jurisdiction under 28 U.S.C. § 1291, this court affirms.
A confidential informant advised police that Harris was distributing drugs in the Kansas City area. A drug task force team observed him with a duffel bag, driving away from his house in a black truck. After following him for a short time, a task force officer asked the Grandview police to stop Harris. A Grandview officer then followed the truck for several blocks, monitoring compliance with the traffic laws. The officer eventually stopped Harris because his truck had a tinted license cover, in violation of a local ordinance.
Asked for permission to search the truck, Harris replied that it was his girlfriend's, so he would call and ask her if it could be searched. Using a cell phone, both Harris and the officer talked to her. The officer understood that "she just basically said no." A drug dog arrived and walked around the exterior of the truck. After the dog alerted, the police searched the truck, uncovering a firearm and nearly three pounds of marijuana. Based on this search, a warrant was obtained for Harris's house, where police found an additional 29.7 pounds of marijuana.
At the suppression hearing, the officer testified that he had to "get right up on the vehicle to get the license plate." During the hearing, part of the police videotape of the stop was played, with the entire tape entered into evidence.
Reviewing a denial of a motion to suppress, this court reviews factual findings for clear error and legal conclusions de novo. United States v. Adler, 590 F.3d 581, 583 (8th Cir.2009). "Whether probable cause existed is a legal question reviewed de novo." Id.
The Grandview ordinance requires that a license plate shall be "plainly visible." GRANDVIEW, MO., ORDINANCES § 14-177 (1993). Missouri state law also requires that the plate shall be "plainly visible" and specifically allows a transparent cover so long as the plate is "plainly visible" and its reflective qualities are not impaired. Mo. Rev.Stat. § 301.130.5 (2007).
Harris argues that the officer did not have a valid reason for the traffic stop. He contends that the initial stop was unlawful because the license cover did not violate local or state law. Harris reasons that because the officer was able to read the plate while following him, there was no violation of law, and thus no probable cause for the stop.
The Fourth Amendment is not violated if the officer making an investigative stop has a reasonable suspicion of criminal activity. United States v. Washington, 455 F.3d 824, 826 (8th Cir.2006); *979 United States v. Martin, 411 F.3d 998, 1000 (8th Cir.2005). Even a minor traffic violation provides probable cause for a traffic stop. United States v. Wright, 512 F.3d 466, 471 (8th Cir.2008). Whether probable cause exists for a traffic stop is judged by whether any mistake, whether of law or fact, is objectively reasonable. Martin, 411 F.3d at 1001, citing United States v. Smart, 393 F.3d 767, 770 (8th Cir.2005).
Harris relies on a case that vacated a conviction based on an officer's mistaken belief that a cracked windshield violated a "vision obstruction" law. See Washington, 455 F.3d at 828. In that case, the state law prohibited only physical objects that obstruct a driver's view. Id. at 826-27. This court held that the officer made a mistake of law that was not objectively reasonable. Id. at 828.
In the Washington case, the officer made a mistake. Here, there was no mistake. As to the facts, the district court believed the officer's testimony that the license plate was not plainly visible. This determination, based on credibility, is not clearly erroneous. The officer's conclusion that the Grandview ordinance prohibited the license cover was objectively reasonable, as it complies with Missouri decisions interpreting the similarly-worded state statute. See State v. Poindexter, 941 S.W.2d 533, 535-36 (Mo.App.1997) (because of a tinted window, temporary tag was not "plainly visible" as required by Mo.Rev.Stat. § 301.130 and the corresponding city ordinance, until the officer "stood next to it"); State v. Young, 425 S.W.2d 177, 178, 180 (Mo.1968) (officer justified in stopping vehicle because it appeared car did not have license plate as required by Mo.Rev.Stat. 301.130.5, although a temporary permit was in the rear window, which officer had not noticed).
There was probable cause for the initial stop, and the resulting search that yielded the incriminating evidence was thus lawful.
The judgment of the district court is affirmed.
NOTES
[1] The Honorable Scott O. Wright, United States District Judge for the Western District of Missouri. | 01-03-2023 | 08-10-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/94258/ | 159 U.S. 317 (1895)
McKEE
v.
LAMON
LAMON
v.
McKEE.
Nos. 33, 34.
Supreme Court of United States.
Argued and submitted March 13, 14, 1895.
Decided October 21, 1895.
APPEALS FROM THE SUPREME COURT OF THE DISTRICT OF COLUMBIA.
*320 Mr. John J. Weed and Mr. Jefferson Chandler for McKee.
Mr. James Coleman and Mr. Nathaniel Wilson for Lamon submitted on their brief.
Mr. Enoch Totten and Mr. Reginald Fendall for Mrs. Latrobe, submitted on their brief.
Mr. Willis B. Smith for Marbury, Administrator, submitted on his brief.
MR. JUSTICE BROWN, after stating the case, delivered the opinion of the court.
In these cases, Nos. 33 and 34, we are concerned only with the decree in Lamon's favor for $35,000, and with that part of the decree dismissing the claim of Lamon and Black. The bill was originally filed for the purpose of securing the payment to Lamon and Black of thirty per cent of the sum of $2,858,798.62 which the appellant was about to receive from the United States, under the authority received by him from the Choctaw Nation, and also for an injunction restraining him from receiving such sum of money, and for the appointment of a receiver, who should be authorized to collect this sum from the Treasury, whenever the same should become due and payable; and also for an accounting between the appellant and Lamon and Black in respect to the amount due them for services rendered and money expended in the prosecution of the claim. It appearing, however, that the contract of February 13, 1855, was never carried out, nor the money ever collected as required by the contract between Cochrane and *321 the Choctaw Nation, before Cochrane could become entitled to his thirty per cent, complainants amended their bill, by averring that McKee procured an act of the Choctaw council of February 25, 1888, making provision for the payment of the amount due under his contract with them, by an express understanding and agreement that he would pay to the complainants and others such sum or sums of money as they were justly entitled to receive, for services rendered and money expended by them in the prosecution of their claim. In his answer, McKee denied the allegations of the bill so far as it related to services alleged to have been rendered in the prosecution of the said claim by the firm of Black, Lamon & Co., or either of them, previous or subsequent to July 16, 1870, but on the contrary averred that Black retired from and abandoned the case before such date; that by reason of such abandonment, the Choctaws, being without counsel, solicited himself and Blunt to take charge of the prosecution of such claim.
1. The first point made by the appellant McKee, that the Supreme Court of the District of Columbia was without jurisdiction to entertain the suit, because upon the averments of the bill the suit was in legal effect one against the Choctaw Nation, to which the nation was a necessary party, is without foundation. The suit is neither directly nor indirectly against the Choctaw Nation; nor if made a party defendant would the complainants be entitled to any relief against the nation. No claim is made against it, nor is any attempt made to impair the effect of its legislation. By its first contract with Cochrane, made by its agents February 13, 1855, in pursuance and by virtue of resolutions of its legislative council of November 9, 1853, and November 10, 1854, it agreed to pay Cochrane for his services thirty per cent of all collections made by him in their behalf. By its second contract, it doubtless assumed that the first contract had been abandoned by Cochrane and his successors Lamon and Black, and agreed to pay the same thirty per cent upon an amount which had already been fixed, with the further stipulation that Blunt and McKee should pay to Mrs. Cochrane five per cent upon such thirty per cent, and should adjust the claims of all parties who had theretofore *322 rendered service in the prosecution of such claim upon the principles of equity and justice, according to the value of the services so rendered.
The Choctaw Nation had really no interest in the thirty per cent. The stipulation was made by Blunt and McKee for the benefit of the parties interested in the percentage, and as soon as the money should be received by them, or either of them, they would hold it as trustees for the persons legally and equitably entitled to it. McKee, having obtained possession of the money, may be held accountable by a court of equity for its proper distribution. There can be no doubt of the general proposition that where money is placed in the hands of one person to be delivered to another, a trust arises in favor of the latter, which he may enforce by bill in equity, if not by action at law. The acceptance of the money with notice of its ultimate destination is sufficient to create a duty on the part of the bailee to devote it to the purposes intended by the bailor. Taylor v. Benham, 5 How. 233, 274; Kane v. Bloodgood, 7 Johns. Ch. 90, 110; Barings v. Dabney, 19 Wall. 1; National Bank v. Insurance Co., 104 U.S. 54; Keller v. Ashford, 133 U.S. 610; Union Life Insurance Co. v. Hanford, 143 U.S. 187; Ryan v. Dox, 34 N.Y. 307; Story's Equity Jurisprudence, §§ 1041, 1255; Mechem on Agency, § 568. And in enforcing such trust, a court of equity may make such incidental orders as may be necessary for the proper protection and distribution of the fund.
It is true that in this case the names of the beneficiaries are not given in the instrument creating the trust, but they are designated by class as "all parties who have rendered service heretofore in the prosecution of said claim," and were to be rewarded "upon the principles of equity and justice, according to the value of the services so rendered." And if there be any conflict between individuals of such class, a court of equity is the proper tribunal for the adjustment of their respective claims. In such case, where the property is disposed of absolutely, the original assignor or party creating the trust need not be made a party to the bill. Story's Equity Pleadings, § 153. This proposition renders it unnecessary to consider *323 whether the Choctaw Nation is subject to be sued in the Supreme Court of the District of Columbia. The fact that the act of Congress making the appropriation required the money to be paid "upon the requisition or requisitions" issued by "the proper authorities of the Choctaw Nation" did not oust the court of equity from controlling its subsequent disposition. The object of the bill is not to change the direction of Congress in respect to such payment, but to determine the further disposition of the money after it has reached the hands of the designated payee.
The objection that there was no consideration for the promise made by the appellant to adjust the claims of all parties, etc., is untenable, since the original receipt of the money is a sufficient consideration for all promises expressed or implied with reference to its final disposition. Walker v. Rostron, 9 M. & W. 411; Mechem on Agency, § 568.
2. The history of this controversy may be epitomized as follows: The Choctaws, believing that they had certain just claims against the government, and particularly for the net proceeds of lands ceded to the United States by the treaty of Dancing Rabbit Creek of September 22, 1830, at first employed Albert Pike to prosecute such claims, and upon his abandoning the same annulled his contract, employed Cochrane and agreed to pay him thirty per cent of the amount collected by him. The contract with him was made February 13, 1855, and continued in force until it was superseded by the contract made with Black, November 8, 1866 indeed, the contract of 1855 indicates that, for three years before that, Cochrane had been acting as the agent of the Choctaw Nation in the prosecution of certain other claims, in regard to which he had rendered most important and valuable services, etc. During these fourteen years he seems to have had charge of the Choctaw claims, and been engaged in their active prosecution. During this time the treaty of 1855, submitting the Choctaw claim for the net proceeds to the Senate, was concluded, and the award of the Senate of 1859 made, by which the Choctaws were allowed the proceeds from the sale of such lands as had been sold by the United States on the first of January preceding, deducting *324 certain expenses therefrom, and referring the claim to the Secretary of the Interior to state the amount due them according to certain principles of settlement laid down by the Senate. During this time, also, the act of Congress of 1861 was passed, which ratified and confirmed the Senate award, and provided for a partial payment thereof. At the same time Cochrane's express contract with the Choctaws was that his compensation of thirty per cent was only payable when the money was paid over by the United States to the Choctaw Nation or its legally authorized representatives in other words, it was contingent upon success. Under this contract he seems to have been paid, for moneys collected before his death, the sum of $282, 600, thirty per cent of the amount he had procured for the Choctaws.
On November 8, 1866, McPherson, the executor of Cochrane's estate, Cochrane in the meantime having died, acting under an authority contained in his will, assigned to Black all the interest of Cochrane in the thirty per cent compensation, and substituted him in the place of Cochrane, with the proviso that he should pay out of the money to be received by him to Cochrane's executor such sum as should be agreed upon between the parties, as well as all other demands justly due and payable out of such thirty per cent. In this connection Black seems to have been acting principally for his partner, Mr. Lamon. It appears that the firm of Black, Lamon & Co. were actively engaged in an effort to secure from Congress an appropriation to pay the Senate award during several sessions, Judge Black appearing before committees of Congress on behalf of the nation and their award, and the other parties preparing memoranda and briefs; that both Lamon and Black devoted much time in explaining the said award, and the claims upon which it was founded, to individual members of Congress. That, in 1870, Mr. Lamon, who had the principal charge of the case, advised the Choctaw delegates to discontinue further efforts to obtain from Congress the payment of the award by direct appropriation, and to apply for the passage of a bill referring the same to the Court of Claims for adjudication; that the delegates declined to accede to this proposition, and *325 insisted upon a further effort to secure the appropriation direct from Congress. That about this time they entered into the contract with McKee, and that thereafter Lamon, who does not seem to have been apprised of such contract, continued to urge upon Congress the justice of their claim and the duty of the United States to pay said award, until about 1878, when he prepared, at the request of Pitchlynn, the chief delegate, a bill authorizing the reference of such claim to the Court of Claims and a memorial to accompany the same.
About 1870, however, Black appears to have withdrawn from the case, except so far as was necessary for the protection of the interests of Thomas A. Scott, who had advanced some $75,000 to Cochrane's executor, whom Black felt in honor bound to protect. His reasons for so retiring are fully stated in a letter of March 27, 1883.
Whether, under Revised Statutes, § 3477, prohibiting the assignment of claims against the United States, as interpreted by this court in Spofford v. Kirk, 97 U.S. 484, and subsequent cases, the original contract between Cochrane and the Choctaw Nation, or the assignment thereof to Black by Cochrane's executor, McPherson, was of any force or validity or not, it is unnecessary to inquire. It is sufficient to say that the contract was entirely contingent upon the money being collected, and the compensation therein provided for was payable only from such money. As none was ever collected by Black or Lamon, they never obtained a legal right to compensation. But the question still arises whether, notwithstanding there was no legal claim, the Choctaws were not at liberty to recognize the fact that important services had been rendered, and that a moral obligation to pay for them existed on the part of those who should ultimately succeed in making the collection.
In this posture of affairs the contract of July 16, 1870, between the Choctaws and McKee was entered into. There is very little, if any, testimony to justify the charge in the amended bill that this contract was fraudulently obtained for the purpose of cheating the complainants and other persons interested in the claim, and to obtain possession of the funds which McKee knew were due and justly payable out of the *326 proceeds. The truth seems to be that the Choctaws were either discontented with the advice given by Lamon and Black to discontinue their efforts to secure a direct appropriation for the payment of the award and apply for leave to go to the Court of Claims, or became satisfied that Black and Lamon were so much engrossed in other matters that they could not bestow the proper attention upon this; in short, that Black had practically abandoned the case, and that further assistance must be obtained. That there was no intention on the part of either party to ignore what had already been done is evident from the concluding paragraph of their contract, out of which the express trust is claimed to arise, that Blunt and McKee would adjust the claims of all parties who had theretofore rendered services in the prosecution of the claim upon the principles of equity and justice, according to the value of the services so rendered. That this clause must have referred to Cochrane and his assignees is evident from the fact that the stipulation was made expressly in favor of those who had "heretofore" rendered services. As such services had been rendered only by Cochrane and his assignees, and as Cochrane's individual claim was already provided for by the donation of five per cent to his wife, it is difficult to understand for what the subsequent reservation was made if not for Black and Lamon, who had succeeded him, and who had certainly rendered some valuable services in the prosecution.
The court below was of the opinion "that the Choctaws, in defining the trust, did not mean that people whose contracts they had annulled were to come within the trust," and hence that Black and Lamon, whose services were all rendered under the Cochrane contract, were not intended to be included. We do not think this necessarily follows. It is true that, in 1874, the general council of the Choctaw Nation did pass an act annulling the contract with Cochrane, but this act is really of very little value, since the contract had already been practically abandoned as early as 1870, and was as dead as any act of the legislative council could make it. This act may have given it its coup de grace, but for all practical purposes it was null already. The object of the stipulation in question was to *327 acknowledge that valuable services had "heretofore" been rendered, and as Cochrane had already been provided for, it is but natural to suppose that his assignees were the ones intended to be recognized.
We are, therefore, of opinion that complainants, as surviving partners of the firm of Black, Lamon & Co., are entitled to recover the reasonable value of those services from the date of the assignment from McPherson to Black to the date of the McKee contract, which may be taken as denoting the time when the Black contract was abandoned. Whatever services Lamon rendered prior to that time he rendered as a member of, and for the benefit of, the firm of Black, Lamon & Co., and that, too, is the theory of this bill, which is founded upon a partnership claim. If, subsequently to that time, or to the time when Lamon first learned of McKee's contract, Lamon rendered services which were of value to McKee, they would not fall within the express trust of the McKee contract, but perhaps might be subject to an implied trust in his favor. As to that, however, and as to the question whether the bill is properly framed to cover an individual liability, we express no opinion.
The decree of the court below is, therefore,
Reversed and the case remanded for further proceedings in conformity with this opinion. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3857171/ | Argued April 14, 1931.
William Morell, employed for a number of years by defendant as a coal loader in one of its mines at Sykesville, in returning, August 6, 1929, from the place of his employment in the mine to the foot of the shaft, was riding on an electric motor locomotive; his head *Page 318
accidentally came in contact with the roof of the mine and injuries were inflicted which resulted in his death the day following. His dependents are his widow, Anna Morell, claimant herein, and an infant son.
The issue in the case is whether the employe, by riding on the motor, so took himself out of the course of his employment as to prevent his dependents from recovering the compensation they would otherwise have been entitled to receive. The controlling facts are not in dispute; the compensation authorities disallowed the claim; the court below held the law had not been properly applied to the facts by the board, and (Rakie v. Jefferson and Clearfield Coal and Iron Co., 259 Pa. 534) entered judgment awarding compensation as therein specified. This appeal is by the employer from that judgment. The referee's disallowance was based upon his conclusion that the employe, at the time he received his injuries, was engaged in a violation of the mining law, amounting to a misdemeanor. The board affirmed this finding and added one to the effect that the employe was also out of the course of employment because "he was engaged in an act contrary to the orders of his employer, in connection with an instrumentality in respect to which he was a trespasser." Its final conclusion of law reads: "Decedent, by boarding the motor, violated the mining laws of Pennsylvania and a posted rule of the employer, in either case, or both cases, taking himself out of the course of his employment." On appeal, the common pleas, being of opinion, as stated by it, "that a very material question of fact was not passed upon either by the referee or the board," and apparently exercising its power to remit the record to the board for more specific findings of fact, returned it with directions to find certain facts as particularly detailed by the court in its order. The board returned the record with additional findings of fact relative to *Page 319
the circumstances under which decedent had boarded and was riding upon the motor. The court below states in its opinion that, although the board "did not adopt the exact language of the court" in its additional findings, they were substantially in accordance with the directions of the court. Assignments of error one to five, inclusive, are based upon the procedure thus adopted by the court below.
This record discloses several matters of procedure which might justly be made the subject of criticism. We are not to be understood as approving the blending of findings of fact and conclusions of law apparent in the opinion of the board or the action of the common pleas in undertaking to direct the board to make certain findings of fact as specified by the court. The power to return the record for more specific findings when, in the opinion of the court, those found are not sufficient to enable the court to decide the question of law raised by the appeal does not include the power to direct what facts the board shall find; the statute requires the compensation authorities to find the facts and the court to accept their findings, if specific and supported by competent evidence. The court can neither find a fact or facts itself nor order the board to find any particular fact. The facts as ultimately found by the board are fully sustained by competent evidence; no harm came to either party through the errors referred to and we therefore proceed to the merits.
Rule 5 of article XXV of the Bituminous Coal Mining Act of June 9, 1911, (P.L. 823), relating to the duties of motormen and locomotive engineers, provides, inter alia, that a motorman "shall not allow any person except his attendant to ride on the locomotive or on the full cars." By section 2 of article XXVI (P.L. 831) it is enacted that "any person who neglects or refuses to perform the duties required of *Page 320
him by this act, or who violates any of the provisions or requirements thereof, shall be deemed guilty of a misdemeanor, and shall upon conviction thereof" be punished as therein provided. The facts explaining the employe's presence on the motor at the time of the injury may be thus stated: Morell and DeChurch, his brother-in-law and "buddy," began their work of loading coal into cars about seven o'clock that morning. The employer, to enable its employes to reach their working places in different portions of the mine, operated each morning about 6:45 what is described in the testimony as a "man trip" from the bottom of the shaft, i.e., a train of unloaded mine cars drawn by a motor. A similar trip started from the inside of the mine at 3:15 each afternoon to accommodate employes returning from their work. The company also maintained appropriate "manways" for the accommodation of employes walking in and out of the mine when necessary. Morell and DeChurch finished loading the available coal about nine o'clock and went from their working place to the main road or heading of the mine, at a point described as the "sixth left switch," referring to a switch from the main track laid in the heading. On the switch was then standing a small motor designated as a "reel" motor, in charge of Stowe Weber and his attendant, waiting for an empty trip. They asked Weber to permit them to ride to the bottom of the shaft on this motor. Before he had made any reply a large motor arrived on the main track, traveling toward the outlet. On this motor, in addition to its motorman and his attendant, were George Plant, the superintendent, having, on behalf of the employer, immediate supervision of the mine; Alex Bruce, the acting mine foreman, in charge of the inside workings and the persons employed therein; Vincent Kramer, the fire boss; and one McGinnis, a powder demonstrator. The large *Page 321
motor stopped opposite the "reel" motor, with a distance of ten or twelve feet between them. Kramer dismounted and asked Morell and DeChurch why they were going home. Upon receiving the explanation that there was no more coal ready for loading, Kramer stated that the large motor was so crowded there was room for only one more and, turning to Morell, said, "Bill, if you can find room on our motor you can go down with us." Weber, the motorman on the small motor, then said, according to his own testimony, "I am not doing anything and I will take them down and will follow you fellows down." Plant, the superintendent, testified that he heard Weber say he would take them down. Bruce, the acting foreman, also heard him say he was going to take them out and testified that neither he nor the superintendent made any objection or gave any instructions to the contrary. The large motor then proceeded, followed by the "reel" motor, with DeChurch sitting beside the motorman and Morell riding "back in the motor." The accident happened on the main track some place between the switch and the bottom of the shaft.
After the record had been returned, the board found, inter alia, "that the superintendent, assistant foreman and the fire boss heard Stowe Weber say he would take decedent on his motor and made no protest, nor warned either the motorman or the decedent that such would be a violation of law." In addition to the rule above quoted, the board and appellant's counsel refer to the general rules 8, 9 and 10 of article XXV (P.L. 827), the first providing that no person shall be allowed to travel on foot to and from his work on any hoisting slope, incline plane, dilly or locomotive road; the second, that no person shall ride upon or against any loaded car or cage in any shaft or slope; and the third, that no person, other than the driver or trip rider, shall be allowed to ride "on the full *Page 322
cars." As the employe was not traveling on foot or riding on a loaded car or cage, we cannot see that these rules are in any way involved in this case. Rule 27, article XXV (P.L. 829) is also invoked. It reads in part: "No person ...... shall travel to and from his work except by the traveling way assigned for that purpose." Notice was posted at the mine opening directing attention to article XXV, rule 27, and article XXVI, clause 2, above quoted, and reading: "All persons found traveling on haulage road other than those designated by law will be dismissed from service and prosecuted in accordance with law." This is the "posted rule" referred to by the board in its conclusion of law. We see no substantial ground for the distinction apparently drawn by the board between the mining law and the posted rule. The rules are a part of the law and are equally binding upon the employer and its employes. The evidence shows a violation of that part of rule 5 which prescribes that the motorman shall not allow any person except his attendant to ride on the motor, but the violation was committed by Weber, the motorman. This rule is found under the heading, "Duties of Motorman and Locomotive Engineer;" its prohibition is aimed at the motorman; if anyone was guilty of a misdemeanor, clearly the motorman was. He was neither prosecuted nor dismissed. Nor are we convinced that the board made a correct application of the law to the facts in concluding that the employe had taken himself out of the course of his employment because he was engaged in an act contrary to the orders and rules of his employer "in connection with an instrumentality in respect to which he was a trespasser." The board cited Dickey v. Pittsburgh and L.E.R.R. Co., 297 Pa. 172. In that case our Supreme Court, after referring to its holding in Shoffler v. Lehigh Valley Coal Co., 290 Pa. 480, that injuries suffered in the "course of his employment" *Page 323
do not include, inter alia, "injuries received in the commission of an act which is in direct violation of the law, or an act contrary to the positive orders of the employer," explained that the latter classification was intended to include only those acts which are in direct hostility to and in defiance of positive orders of the employer concerning instrumentalities, places or things, about or on which the employe has no duty to perform and with which his employment does not connect him, and as to which instrumentalities he is in the position of a stranger or trespasser. In the case cited the employe was a shop watchman and was repeatedly instructed to use a certain board walk from the station to the carpenter shop. In violation of his instructions he took a short cut of about half the distance across tracks and was killed. In sustaining the disallowance of compensation to his dependents the Supreme Court said, at p. 176: "Here was a plain violation of positive instructions. It concerned a matter designed for the safety and protection of employees. He had no duty to perform on the place of the accident or the instrumentality that killed him nor did his work bring him in any manner in contact with them; as to these he was a stranger. To sustain a different theory would weaken the beneficial effect of the law, take from the employer all opportunity to guard against accident and make discipline in a plant merely a thing of words only. Where an employee violates a positive rule as to entering forbidden parts of the owner's premises about which he has no duty to perform, or disobeys instructions against starting machinery or other dangerous agencies with which his work is not connected, and with which he has no business, and an injury results, he not only violates the orders of his employer, but is in the position of a trespasser, who without right, authority or permission enters forbidden ground." *Page 324
Here the situation was entirely different. Morell was not riding on the motor in defiance of rules and positive orders of his employer; he was there with the knowledge and tacit approval of the employer's superintendent, the official charged, under the statute, with the immediate supervision of the mine on its behalf, and with the knowledge and similar acquiescence of the acting foreman, placed by the employer in charge of the inside workings and of the persons employed therein. Moreover, he was there in accordance with the actual arrangement made, in their hearing, between the fire boss and the motorman. Under these circumstances there was, in our opinion, no justification for concluding that he was a trespasser. So far as rule 27 is concerned it is not too much to say that he was traveling from his work in the "way assigned" to him on that occasion by the official representatives of his employer. It does not appear that a powder demonstrator has any more right to travel on a motor than has a loader. If any technical infraction of the rules occurred the highest operating officials were, under the evidence, equally responsible with the employe. They were still in the employ of the company at the date of the argument. The defendant should not be permitted to play fast and loose with the rules — condone their infraction by the officials charged with their enforcement and then set them up as a bar against recovery of compensation by the dependents of an employe killed while traveling from his work in a manner to which they had given their assent and approval.
We do not concur in all the reasoning of the court below, but a majority of the members of this court are of opinion that the judgment reversing the board and awarding compensation is just and in accordance with the legislative intent of the law under which it was entered.
Judgment affirmed. *Page 325 | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1714487/ | 104 So. 2d 524 (1958)
H.P. GORDON, Harry E. King, James L. Busbee and Rollie Arnold, Appellants,
v.
STATE of Florida, Appellee.
Supreme Court of Florida.
July 25, 1958.
*527 Martin & Martin, Plant City, and Bentley, Shafer & Miller, Lakeland, for H.P. Gordon. James L. Busbee, Rollie Arnold and Sentell Monk; Chester Bedell, Jacksonville, and L. Grady Burton, Wauchula, for Harry E. King.
Richard W. Ervin, Atty. Gen., and Odis M. Henderson, Asst. Atty. Gen., for appellee.
THORNAL, Justice.
Appellants Gordon and King seek reversal of a judgment of conviction entered pursuant to a jury verdict finding them guilty of the crime of subornation of perjury. Appellants Busbee and Arnold seek reversal of a judgment of conviction entered pursuant to a jury verdict finding them guilty of the crime of perjury.
A total of seventy-nine alleged errors have been assigned by the four appellants. Those which require attention are discussed. The others are not such as to require detailed comment.
During the times herein mentioned appellant King was the State Senator from Polk County. He had been designated president of the Senate but had to stand for re-election in the primaries and general election of 1956. In the latter part of 1955 King suspected that opposition was brewing for the 1956 Spring Primary. One of the rumored opponents was State Representative Boone D. Tillett. In late October or early November, 1955, King approached Tillet in what appears to have been an effort to discourage the latter from entering the Senate race. This initial conference set in motion one of the most bizarre transactions that has come to light in the history of Florida politics.
After several conferences back and forth it was finally agreed between the two that *528 King would pay Tillett the sum of ten thousand dollars to keep the latter out of the Senate race. At the outset it appeared to be Tillett's notion that he would not reveal the scheme until after the 1956 Spring primaries. He apparently lost control of the situation when he reported the affair to the State Attorney in Tallahassee, as we shall see. The ultimate arrangement was that in exchange for the ten thousand dollars Tillett would deliver to King certain photographs and affidavits that King felt would have been damaging to him politically. In addition it was agreed that Tillett would sign a statement announcing that he would not enter the Senate race. They finally agreed to exchange documents for money in the vicinity of King's citrus grove, eight miles out of Babson Park in Polk County, on the night of February 4, 1956. They there burned the photographs and affidavits. A part of the plan was that Tillett would go to Tallahassee and advise a representative of the Associated Press that he was not entering the Senate race and that a letter would be forthcoming to that effect. Tillett did go to Tallahassee but merely advised Mr. Harold Parr of the Associated Press that he, Parr, would receive a certain letter. Tillett added the request that instead of opening the letter, the newspaperman should deliver it unopened to Honorable William D. Hopkins, State Attorney for the Second Judicial Circuit. Tillett also communicated with Mr. Hopkins and Honorable Reeves Bowen, who for many years has been the head of the Criminal Division of the Attorney General's office. Tillett apparently advised them of the whole plot.
According to the understanding, King mailed the Tillett withdrawal letter from Tampa. As we shall see, although King was ignorant of the fact, Tillett had arranged to have his name signed to this letter by one of his friends. When the letter was received by the Associated Press representative it was opened and the contents published. It was then turned over to State Attorney Hopkins by Mr. Parr. This exploded the whole scheme and produced public statements back and forth by King and Tillett. It also produced something else a grand jury investigation of the whole affair. We glean from this record that the investigation was at least suggested in a request by Tillett to the State Attorney for the Tenth Judicial Circuit which includes Polk County.
Before the grand jury convened to consider the matter the Governor assigned Mr. Hopkins, as State Attorney, to go to the Tenth Circuit and investigate the affair. This Mr. Hopkins did. Called to testify before him were many witnesses including appellants Gordon, Busbee and Arnold. Gordon was sheriff of Polk County. Busbee and Arnold were two of his deputies.
The statements under oath before Mr. Hopkins, as State Attorney, revealed that Gordon had been involved in numerous conversations regarding the affair with both King and Tillett during the period of negotiations leading up to the alleged "pay-off" on February 4, 1956. He could hardly be classed as an "intermediary." However, he appeared to be a mutual political ally of both principals. He willingly exposed himself to conversations with both parties. Shortly prior to the fatal date, the sheriff had assigned Busbee and Arnold to "co-operate" or "work" with Senator King. Busbee told the State Attorney that he was secreted in the King grove at the time of the "pay-off" and saw some papers passed from Tillett to King while the two were seated in an automobile. He said he then saw the two men get out of the automobile and burn something in front of the car. Arnold stated that he was present in the grove with Busbee, that he saw "two men" in the car and also witnessed the burning of something. He did not identify the men or witness the passing of the papers.
After the matter was investigated by State Attorney Hopkins, he presented the whole thing to the grand jury which was empaneled on March 13, 1956. On March *529 14, 1956, Busbee and Arnold testified before the grand jury pursuant to summons. From the grand jury witness stand Busbee and Arnold reaffirmed under oath the truth of their prior statements to Hopkins regarding their presence at the scene of the "pay-off" on February 4, 1956, as well as the things which they then saw, all of which are summarized above. On March 16, 1956, the grand jury indicted Busbee and Arnold for the crime of perjury. On March 20, 1956, the grand jury indicted King for alleged violations of the State Election Code, F.S.A. § 97.011 et seq. It should be noted that six days elapsed between the time Busbee and Arnold testified and the subsequent indictment of King.
Honorable Clifton Kelly, County Solicitor of Polk County, with understandable propriety asked to be excused from prosecuting this matter because his brother was also a candidate for the State Senate in the approaching primary. The Governor appointed Honorable Paul B. Johnson, County Solicitor of neighboring Hillsborough County, to serve in the stead of Mr. Kelly. On April 13, 1956, the acting County Solicitor filed a six-count information against the four appellants and one Sentell Monk, a county jailor, who as it seems allegedly had altered certain jail records to make it appear that Busbee and Arnold could have been at the pay-off scene at the time they swore they were there. Allegedly the unaltered jail records would have shown that at the time of the alleged "pay-off" the deputies were apprehending prisoners and placing them in jail. Certain State witnesses testified that this was actually a fact. Others stated that in their opinions the jail records had been altered. For reasons hereafter mentioned, Monk is not a party to the appeal in this court.
The sum of the information on which the defendants were tried and convicted is as follows:
Count 1: Gordon, King, Busbee, Arnold and Monk were charged with conspiracy to have Busbee swear falsely before the grand jury.
Count 2: Gordon, King, Busbee, Arnold and Monk were charged with conspiracy to have Arnold swear falsely before the grand jury.
We here interpolate that at the time of the alleged offense conspiracy to commit any offense was a misdemeanor. Section 833.01, Florida Statutes 1955, F.S.A. Appeals from misdemeanor convictions are heard by the circuit courts. The convictions under the first two counts for conspiracy are therefore not before us. Hence, the defendant Monk is not a party to this appeal. Similarly, we do not here pass on the conspiracy convictions of the four appellants. We proceed to epitomize the other four counts of the information.
Count 3: Gordon and King were charged with subornation of the alleged perjury of Busbee.
Count 4: Gordon and King were charged with subornation of the alleged perjury of Arnold.
Count 5: Busbee was charged with perjury before the grand jury while that body was investigating alleged violations of the Election Code.
Count 6: Arnold was charged with perjury before the grand jury while that body was investigating alleged violations of the Election Code.
After a trial that lasted for three weeks Gordon and King were found guilty under Counts 3 and 4; Busbee and Arnold were found guilty under Counts 5 and 6, respectively. As mentioned above, they were also convicted under Counts 1 and 2 but these convictions are not before us. Motions for new trials were denied. Judgments of conviction and sentences to terms in the state prison were entered and prescribed. Reversal of these judgments is now sought.
It should be kept in mind that these appellants were being prosecuted on charges *530 of perjury and subornation thereof. We are not here dealing with violations of the election laws or breaches of rules of political morals. A studious examination of this record produces the inescapable conclusion that unfortunately throughout the trial resentment against alleged political misprisions and politically offensive conduct was permitted to permeate the proceeding. While this is quite understandable in the light of the political atmosphere that prevailed at the time, nevertheless, the rights of these appellants who were on trial for two of the noxious charges in the Criminal Code cannot be measured by our concept of political morality. Tindall v. State, 99 Fla. 1132, 128 So. 494. Whether the election laws were violated is an entirely separate matter. We here deal with perjury and subornation of perjury and nothing else.
The crime of perjury committed in a judicial proceeding is condemned by Section 837.02, Florida Statutes, F.S.A. The crime of subornation of perjury is condemned by Section 837.03, Florida Statutes, F.S.A. The crimes are not clearly defined by the statutes. We, therefore, look to cases and the common law for definitions. In Wharton's Criminal Law and Procedure, Vol. 3, Sec. 1290, we find the following:
"At common law perjury was (1) the wilful (2) giving of false testimony (3) on a material point (4) in a judicial proceeding, (5) by a person to whom a lawful oath had been administered."
See also Clark and Marshall, Crimes (5th ed.), p. 641, Sec. 446(a). The foregoing are the basic essentials in Florida. Miller v. State, 15 Fla. 577. The cited statute (Section 837.03, Florida Statutes, F.S.A.) suggests and the authorities agree that subornation of perjury consists of procuring or inducing another person to commit the crime. See Wharton's Criminal Law and Procedure, Vol. 3, Sec. 1321; Clark and Marshall, Crimes, (5th ed.) p. 652, Sec. 446(h). Also see Milligan v. State, 103 Fla. 295, 137 So. 388. An essential element of subornation of perjury is the actual commission of the crime of perjury. The authorities are not entirely in accord as to whether conviction of the perjurer is a condition precedent to conviction of one who suborns the perjurer. There is complete accord, however, on the proposition that in order to establish subornation of perjury it is essential that the commission of the crime of perjury by the person suborned must be proved as an element of the substantive crime of subornation. Drawdy v. State, 98 Fla. 473, 123 So. 913; Milligan v. State, supra.
It is clear that in the case before us proof of the alleged perjury by Busbee and Arnold were conditions necessary to establish the charge of subornation of perjury leveled against Gordon and King. It will be noted from the definition of the crime of perjury that the essential elements are the wilful giving of false testimony under lawful oath on a material matter in a judicial proceeding. The cases are in accord that a grand jury investigation is a judicial proceeding which will support a charge of perjury if the other elements are present. Craft v. State, 42 Fla. 567, 29 So. 418; Rivers v. State, 121 Fla. 887, 164 So. 544; Tindall v. State, supra.
One of the principal points assigned by the appellants for reversal of the judgment under attack is that the alleged false testimony given under oath by Arnold and Busbee before the grand jury was not material to the matter then under investigation by the grand jury. The information alleged in substance that while the grand jury was investigating, among other things, violations of the election laws, Busbee falsely testified that he witnessed and observed a meeting between Tillett and King and that he witnessed and observed the burning of certain materials and objects by the two men. The information alleges that Arnold falsely testified that he and Busbee together witnessed the meeting and the burning of the materials.
*531 It appears to be the position of the appellants that whether Busbee and Arnold actually witnessed the occurrences to which they testified was completely immaterial to the subject of the grand jury investigation, to-wit, the alleged violations of the election laws. The rule is clear that in order for the false testimony to constitute perjury it must be material to the subject under consideration in the judicial proceeding. Miller v. State, supra; Robinson v. State, 18 Fla. 898; Smith v. State, Fla. 1957, 92 So. 2d 411. The cases hold that in order for testimony to be material it must have some weight and reference to the determination of an issue which is before the court for judicial determination. It is not essential that the false testimony bear directly on the main issue. It is sufficient if the false testimony is collaterally or corroboratively material to the ultimate material fact to be established. The degree of materiality is not of any important consequence. Robinson v. State, supra; Herndon v. State, 72 Fla. 108, 72 So. 833; Fields v. State, 94 Fla. 490, 114 So. 317; D'Alessandro v. State, 116 Fla. 749, 156 So. 702; Tindall v. State, supra; Doan v. United States, 9 Cir., 202 F.2d 674.
The State contends and we agree that the testimony of Busbee and Arnold before the grand jury was of sufficient materiality to the subject of the investigation to support the charge of perjury if the other elements of the crime were present. The point apparently under investigation by the grand jury was the transaction between Tillett and King with reference to the exchange of money in consideration of certain matters relating to the forthcoming primary election. Without corroboration the State would have been compelled to rely almost entirely on a narrative of events as related by Mr. Tillett. The testimony of Busbee and Arnold, if true, tended to support various material aspects of the testimony given by Tillett in regard to the time, place and secretive nature of the exchange, the manner in which the parties went about accomplishing the transaction, the burning of the documents, as well as venue. Although the appellants ask us to decide that this testimony was immaterial and that their complete exoneration should be ordered, we cannot agree with their position. The trial judge ruled correctly in holding that the alleged false testimony was material to the matters under consideration by the grand jury.
It is further contended that the testimony given by Busbee and Arnold before the grand jury was lacking in the essential of having been given pursuant to a lawful oath. Markey v. State, 47 Fla. 38, 37 So. 53. On this point it appears to be appellants' position that in actuality the grand jury was not investigating violations of election laws when Busbee and Arnold testified on March 14, 1956. They suggest as a matter of fact that the grand jury was investigating Busbee and Arnold on suspicion of falsely swearing before State Attorney Hopkins. Section 837.01, Florida Statutes, F.S.A. They then reason that Busbee and Arnold should have been warned that they were under investigation and should have been advised of their constitutional privilege against self-incrimination. This leads appellants to the ultimate contention that absent such warning and advice Busbee and Arnold were led to testify in a self-incriminating manner and that this in turn destroyed the binding effect of the oath which they took before the grand jury, and immunized them against subsequent prosecution.
This encourages the appellants to claim that the convictions should be reversed with directions for their discharge. Again, however, we are compelled to disagree with the appellants and agree with the position of the trial judge. The record clearly sustains a conclusion that when Busbee and Arnold were subpoenaed to testify before the grand jury, that body was investigating alleged violations of the election laws. We find nothing to compel us to conclude that at that point Busbee and *532 Arnold themselves were under investigation. We note in passing that perjury is not one of the crimes mentioned in our immunity statutes. Sections 932.29 and 104.39, Florida Statutes, F.S.A. The oath which a witness takes is sufficient to put him on notice that he is expected to tell the truth and we are not aware of any authorities which require that a witness be warned that if he fails to tell the truth he will likely suffer the pains of a prosecution for perjury. People v. Miller, 264 Ill. 148, 106 N.E. 191; Hardin v. State, 85 Tex. Cr.R. 220, 211 S.W. 233, 4 A.L.R. 1308.
Another aspect of the matter is that these two men apparently testified without reservation. Had they so desired they could have claimed their privilege against self-incrimination if they were faced with the alternatives of either committing perjury before the grand jury or admitting that they swore falsely before the State Attorney. The statutory immunity granted to a witness who is required to testify with reference to certain specified crimes will not immunize him against a subsequent prosecution for perjury in the event that he testifies falsely. 41 Am.Jur. "Perjury" Sec. 52, p. 29; State v. Faulkner, 175 Mo. 546, 75 S.W. 116; Gendron v. Burnham, 146 Me. 387, 82 A.2d 773, 38 A.L.R. 2d 210, annotation at page 314. Having failed to assert their privilege and having proceeded to testify, they are subject to the consequences if they testified falsely. Gendron v. Burnham, supra; also see State v. Byington, 1945, 114 Utah 388, 200 P.2d 723, 5 A.L.R. 2d 1393, annotation at page 1436.
In outlining the State's case in his opening statement to the jury, the county solicitor undertook to summarize what he expected to prove with regard to the negotiations between Mr. Tillett and Senator King. In the course of his remarks, in each instance over the objection of the appellants, the county solicitor was permitted to advise the jury that he intended to prove occasions from time to time during the period of negotiations between the men when Mr. Tillett, after conferences with Senator King, would meet with groups of friends "all respectable businessmen of this area" and that Tillett "conferred with his advisors and upon their advice he decided to expose this attempted pay-off and turn the evidence over to the proper authorities" and numerous other statements of similar nature. At one point when objections were offered the trial judge observed "the complications of this case are such that the court is not able to determine whether or not that is material or not. I can see where it might be material." (Emphasis added.) We realize that these comments by the prosecutor did not constitute evidence and the jury was so advised. We mention them merely as a part of the background against which the evidence itself was subsequently allowed to go to the jury. In the presentation of the State's case Mr. Tillett was permitted to testify that after his first conversation with Senator King he sought the advice of a group of friends, naming them and the place of their meeting, that they advised him what to do and that he was going through with the deal "on advice of friends" all highly respectable businessmen.
On another occasion Mr. Tillett was permitted to testify to the effect that he talked to a particular friend on the telephone, that pursuant to this conversation he arranged a meeting at that friend's house from which they moved on to the home of a circuit judge and discussed generally what was going on, that at that time they devised a plan for a friend of Mr. Tillett to sign Tillett's name to the withdrawal letter as evidence of the fact that Tillett's motives were pure and that he was not particeps crimini.
On another occasion Tillett was permitted to testify that after the February 4 meeting with King he immediately went to the home of one of his friends, told him that he had the ten thousand dollars and that they went to Lake Hamilton and put the money in a safe. Tillett was further permitted to testify that while in Tallahassee he had a conversation with an Assistant *533 Attorney General and that he had another conversation with Honorable William D. Hopkins, the State Attorney, and that he had a further conversation with a representative of the Associated Press and "told him to turn it (the letter) over to the State's Attorney, Mr. Hopkins."
All of these alleged conferences were had privately by Mr. Tillett and out of the presence of all the defendants. When objections were made, the trial judge was of the view that it was permissible to show these various conferences and to explain Mr. Tillett's actions pursuant to the conferences in order to establish Tillett's "motive." We are here compelled to disagree with the ruling of the trial judge. As pointed out in the forepart of this opinion no one is here being tried for violations of the election laws. If Mr. Tillett were, then whether he was acting in good faith and from laudable motives could be substantially material. However, Mr. Tillett is not on trial for anything and his motives are totally immaterial. We are here dealing with the particular charge that Busbee and Arnold committed perjury and that Gordon and King suborned the perjury. Whatever Mr. Tillett's motives were throughout the transaction could have no possible bearing at all on the truth or falsity of the testimony given before the grand jury or the charge that the witnesses were procured to do so. The only purpose that could be served by the testimony improperly admitted would be to portray Mr. Tillett as having proceeded from laudable motives as contrasted to the appellants who were naturally portrayed as wilful violators of the criminal law who were engaged in a plot to violate the election laws. The improper and unfair impact of such testimony upon the jury sitting to determine guilt or innocence of the appellants with reference to the perjury and subornation charges certainly becomes obvious and cannot be disregarded as trivial. Whatever Mr. Tillett's objectives or ideas were in conducting the negotiations with Senator King could have no possible bearing on whether or not Busbee and Arnold were at the scene of the pay-off and saw what they said they saw or whether Gordon and King induced them to testify accordingly. We think this line of testimony has no place whatever in this record and that it produced substantial injury to these appellants in the trial and ultimate outcome of the case. It illustrates the point which we made at the outset to the effect that the suspected breach of political morals and suspicions of election law violations were permitted to saturate this record in order to convict appellants of perjury and subornation. The result was that a mass of irrelevant although harmful testimony was presented to the trial jury. Capps v. State, 1940, 29 Ala.App. 192, 194 So. 689; Saucier v. State, 95 Miss. 226, 48 So. 840.
Appellant King further contends that the trial judge committed error when he allowed into evidence the copy of the indictment filed by the grand jury indicting King for violations of the election law. It so happens that Busbee and Arnold were indicted for perjury on March 16, 1956. It was not until four days later that King was indicted for violations of the election laws. A copy of this indictment was allowed into evidence for the ostensible purpose of showing that the grand jury was investigating violations of the election laws when Busbee and Arnold allegedly testified falsely on March 14, 1956. In the first place this and all other courts so far as we know have consistently adhered to the general rule that when a defendant is on trial for a particular crime it is not proper to admit evidence of commission of unrelated collateral crimes. There are exceptions to this rule whereby it is permissible to allow evidence of collateral crimes in order to establish intent, motive of a pattern of criminality. The allowance of the indictment into evidence in this instance does not fall within any of the exceptions. It could serve no genuine purpose other than to convey to the trial jury the fact that the grand jury had deliberated and had concluded that Senator King was guilty of the offense of violating various sections of the election law. It *534 could do no more than substantially prejudice the appellant King in the minds of the trial jury and place him at a tremendous disadvantage in defending himself against the charge of subornation of perjury.
It appears to us that the fact that the grand jury indicted King for violation of the election laws six days after Busbee and Arnold testified before that body is certainly not conclusive on the point as to what the grand jury was investigating when the two men did testify. Matters under investigation by the grand jury were easily provable by the testimony of the court reporter who transcribed the grand jury proceeding or for that matter by any member of the grand jury or by the transcript of the initial recorded proceedings of the grand jury. State ex rel. Brown v. Dewell, 123 Fla. 785, 167 So. 687; Tindall v. State, 99 Fla. 1132, 128 So. 494; Settles v. State, 75 Fla. 296, 78 So. 287. Actually the court reporter who testified for the State certified in his certificate to the transcript of the grand jury testimony the subject of the grand jury investigation. Suffice it to say that permitting the State to offer in evidence a collateral indictment for an entirely separate offense was substantial error that inescapably produced harmful results. The State incidentally has produced no authority whatever that would allow the placing of this indictment into evidence.
On the contrary a strongly analogous rule, well supported by both reason and the authorities, militates almost conclusively against the admissibility of the indictment. The rule is well established that while such portion of the record in the inquiry or judicial proceeding in which the perjury allegedly occurred is admissible at the perjury trial to the extent necessary to show that it was a judicial proceeding and that the allegedly false testimony was material thereto, nevertheless, the result or culmination of such inquiry or proceeding is immaterial and its allowance into evidence in the perjury trial is erroneous. Thus if perjury occurs in a criminal trial, the judgment of conviction or acquittal in that trial is not admissible in a subsequent perjury trial. This is so because it obviously introduces to the jury hearing the perjury case the plainly collateral issue as to whether the jury in the prior criminal trial believed or disbelieved the allegedly perjured testimony. State v. Armstrong, 1935, 337 Mo. 967, 87 S.W.2d 164; Starnes v. State, 1933, 125 Tex. Crim. 21, 66 S.W.2d 335; Warren v. State, 1909, 57 Tex. Crim. 518, 123 S.W. 1115; State v. Olson, 1932, 186 Minn. 45, 242 N.W. 348; State v. King, 1940, 165 Or. 26, 103 P.2d 751; Saucier v. State, 95 Miss. 226, 48 So. 840.
The analogy of the last stated rule to the case before us we think is clear. While it was of course proper for the State to establish that the grand jury was investigating alleged violations of the election laws we do not think it was proper to advise the trial jury of the ultimate action of the grand jury. If the testimony of Busbee and Arnold was false it would have constituted perjury regardless of whether the grand jury indicted King or anyone else for election law violations. In other words the finding of the indictment against King had no bearing whatever on whether or not perjury was committed by Busbee and Arnold. It appears to us that it was clearly prejudicial error to inform the jury trying King for subornation of perjury that the grand jury had already indicted him for election law violations, even though the trial judge endeavored to limit the jury's consideration of the indictment as mere evidence of the subject matter of the grand jury inquiry. Here again the perjury trial became entangled with aspects of alleged election law violations that had no material bearing whatever on the immediate charges against these appellants.
The State was permitted to place in evidence the testimony of one C.A. Smith to the effect that, at the request of appellant King, Smith had cashed a check in the amount of one thousand two hundred dollars at a Winter Haven bank. He testified that the check was payable to cash and was signed by one Al Lane, deceased, who had *535 operated a "package and bar up in Orlando." Similarly the State was also permitted to place in evidence the testimony of one A.D. Tomasello to the effect that he had made two cash loans to King in the amount of two thousand five hundred and five thousand dollars, respectively. Mr. Tomasello was identified as a public relations representative of a Florida trucking company and a Washington chain store organization. The money obtained from these loans was, of course, not traced into the ten thousand dollars payment by King to Tillett. Even if it had been, however, we can see no materiality whatsoever between the testimony of these two witnesses and the issues involved in the trial of the appellants for perjury and subornation of perjury. Here again is an instance where the aspect of alleged violations of the Election Code were allowed to enter into the trial of these appellants on the perjury matters. Once again it is important that we emphasize that the instant appeal and the instant case involved simply whether Busbee and Arnold swore falsely before the grand jury and whether Gordon and King procured them to do so. Insofar as the instant case is concerned the source of the money which King paid over to Tillett was totally irrelevant and immaterial. If King were being tried for violations of the Election Code involving illegal contributions or payments, an entirely different proposition might be involved. However, the alleged perjury simply had to do with whether Busbee and Arnold witnessed the two men at the pay-off scene and witnessed certain occurrences at the time. Whether King obtained the money from his own bank account or from some other source was totally useless and immaterial as a means of establishing any fact related to the crimes alleged in the information. The only purpose that this testimony could have served was to create a prejudice in the minds of the trial jury, based on the suggestion that King may have violated the Election Code and that, therefore, Busbee and Arnold were guilty of perjury and Gordon and King were guilty of subornation.
In defense of the testimony the State, by its brief, offers a rather meager explanation to the effect that Tillett had testified that he received the money in certain denominations and that these two witnesses were offered to corroborate Tillett's testimony (which in itself was totally immaterial) although the sum of the testimony of these witnesses was merely that they had delivered the money to King in cash. The State brushes off the contention that the testimony was immaterial and prejudicial with the mere observation that it was not. Adding immaterial testimony to corroborate immaterial testimony does nothing more than compound the prejudicial effect of the error. This is obviously so because the corroboration adds greater weight to the testimony which it supports. If the testimony which is corroborated was in itself prejudicially immaterial, certainly the error is emphasized by the addition of support or corroboration of the original error. 20 Am.Jur. "Evidence" p. 242, Sec. 248; 13 Fla.Jur. "Evidence", p. 117, Sec. 112. In the first place there was no dispute over the fact that the ten thousand dollars were paid to Tillett by King and whether they were paid in one-hundred-dollar bills or one-thousand-dollar bills has no bearing whatever on whether Busbee and Arnold saw certain papers passed between Tillett and King and whether they saw the two men burning certain materials. This was the crux of the controversy and the source of the money paid by King to Tillett was of no materiality at all when related to the issues before the trial court. We think that this testimony was obviously harmful and prejudicial and constitutes another reversible error.
Prior to the trial the appellants filed a formal written motion setting out that the complete transcript of the testimony of all witnesses who appeared before the grand jury had been released to the prosecuting officers for their use in the prosecution of the instant case. The motion pointed out the voluminous nature of the grand jury proceeding and requesting the trial judge to permit the appellants to examine the transcript of the testimony which had been released *536 to the prosecuting officials and to make copies of the testimony of all of the various witnesses who testified before the grand jury in order to enable the appellants to prepare their defense. The trial judge denied the motion except insofar as it related to the testimony of any witnesses who testified before the grand jury and who would be called to testify personally in behalf of the State from the witness stand in the instant trial. State ex rel. Brown v. Dewell, 123 Fla. 785, 167 So. 687. We should here point out that the critical evidence used by the State to convict the appellants was a transcript of the testimony of the appellants Gordon, Busbee and Arnold given before the grand jury. In other words, while these three appellants were not called as witnesses in the trial of the instant case, their ex parte testimony before the grand jury was placed in evidence to enable the State to convict Busbee and Arnold of perjury and Gordon and King of subornation of perjury. The transcript was also used against all of the alleged conspirators named in Counts 1 and 2 of the indictment, including King and Monk.
In ruling on this motion to inspect the transcript of testimony of the grand jury we think perhaps the court may have overlooked the full effect of Section 905.27, Florida Statutes, as amended in 1951, F.S.A. This statute reads as follows:
"Testimony not to be disclosed; exceptions
"No grand juror, prosecuting attorney, or special legal counsel, court reporter, interpreter, or any other person appearing before the grand jury, shall disclose the testimony of a witness examined before the grand jury or other evidence received by it except when required by a court to disclose the testimony of a witness examined before the grand jury for the purpose of ascertaining whether it is consistent with that of the witness given before the court, or to disclose the testimony given before the grand jury by any person upon a charge against such person for perjury in giving his testimony or upon trial therefor, or when permitted by the court in the furtherance of justice. Any person violating the provisions of this act shall be guilty of a criminal contempt of court, and punished accordingly." (Emphasis added.)
It will be noted from examination of the quoted statute that the crime of perjury is given special treatment when the question of raising the traditional secrecy of grand jury proceedings is involved. By the statute a court may require the disclosure of the testimony of a witness before a grand jury upon a charge against such person for perjury in giving his testimony or upon a trial therefor. In other words, inasmuch as a grand jury investigation is a judicial proceeding out of which the crime of perjury may arise, the Legislature has prescribed in effect that when a person is charged with having committed perjury before a grand jury a court may properly remove the cloak of secrecy with reference to that particular testimony. With regard to the appellants Arnold and Busbee it appears to us that inasmuch as the cloak of secrecy had already been raised by the delivery of a complete transcript of the grand jury proceeding to the State, there can be little doubt but that these appellants were granted the right by the quoted statute to have a copy of the testimony given by them before the grand jury upon which the perjury charge was based. This would appear to be of special significance in a case such as this where the testimony was voluminous and involved much background data as well as the particular answers which were allegedly perjurious. The grand jury testimony of Gordon, Busbee and Arnold, read into this record by the Court Reporter, filled two hundred pages of legal cap.
The effect of the ruling of the trial judge insofar as Arnold and Busbee were concerned was to hold that the State could use a copy of their testimony to charge them *537 with perjury, try them on the charge and send them to jail but in the same voice they were denied access to a copy of their testimony in order to equip themselves to defend against the charges. Under these circumstances it appears to us that common justice, much less the specific language of the statute, would have entitled Busbee and Arnold to have a copy of the testimony which they gave before the grand jury in order to prepare their defense.
By the same process of reasoning it appears to us that appellants Gordon and King were entitled to have a copy of the grand jury testimony given by Gordon, Busbee and Arnold which was placed in evidence against them by the State through the voice of the Court Reporter who transcribed the grand jury proceedings. Here again it should be observed that Section 905.27, Florida Statutes, F.S.A., gives special treatment to the crime of perjury in regard to the matter of raising the veil of secrecy that protects grand jury proceedings. We think by necessary inference and certainly by pointed analogy the privilege of examining a transcript of the testimony of the witnesses alleged to have perjured themselves should be made available to those accused of the crime of suborning that particular perjury.
The trial judge appears to have the view that with reference to the three appellants who had testified before the grand jury there was no justification for permitting an examination of the transcript of their testimony because of the fact that they were being tried for a crime arising out of their testimony and that they would be familiar with the testimony that they had given before the grand jury. While there is a measure of reason to this view, nevertheless, from a practical aspect in a case such as this the injustice of the rule becomes apparent. For a helpful discussion of the importance of making a transcript of such testimony available to a defendant in a perjury case, see United States v. Rose, 3 Cir., 215 F.2d 617. This is so because of the voluminous nature of the grand jury testimony as a result of which it could hardly be expected that an individual witness would recall every question and answer. Another factor is that the statute cited, in the absence of authorization by the court, would preclude each of the appellants who testified before the grand jury from revealing his testimony to anyone else. Furthermore, it should be remembered that a grand jury proceeding is in its nature ex parte in that the only ones present in addition to the witness are the grand jurors and the court officials. It would be impossible for the individual appellants to know what the others testified without an approving order of the trial judge.
What we have here written applies only to the crime of perjury and the related offense of subornation of perjury. We base our position primarily on the fact that the statute treats perjury as a peculiar exception to the secrecy rule that protects grand jury proceedings. We think also that subornation of the particular perjury is within the spirit, if not the letter, of the controlling statute. In denying access to the transcript of testimony given by witnesses who were not to be called to testify at the trial and who were not defendants we think the judge ruled correctly. However, in denying access to a transcript of the grand jury testimony of the appellants Gordon, Busbee and Arnold, error was committed for the reasons stated.
The appellants Gordon and Arnold further contend that the trial judge committed error when he denied their motion to allow their attorney to make the opening and closing argument to the jury. The record reveals that the appellant Busbee, who along with appellant Arnold was charged with perjury and together with appellants King, Gordon and Arnold was charged with conspiracy to commit perjury, offered the testimony of some thirteen witnesses. Appellants Gordon, Busbee and Arnold were represented by the same counsel.
*538 Each time a witness was called by Busbee the record affirmatively shows that he was called by this particular appellant and was not called in behalf of any of the other appellants. Numerous exhibits were introduced by Busbee. In each instance they were marked as exhibits for the "defendant Busbee." None of the defendants testified in his own behalf. At the close of all of the evidence, the attorney for Gordon and Arnold moved the court to allow him to make the opening and closing argument to the jury in behalf of those two defendants on the theory that they had not taken the witness stand nor had they offered any other testimony.
The trial judge was of the view that the witnesses who had testified on behalf of Busbee had given testimony which was of benefit to the defendants Gordon and Arnold and that this fact, coupled with the fact that all of these defendants were represented by the same lawyer, justified the denial of the right to open and close claimed by Gordon and Arnold. The witnesses called by Busbee had testified as to various matters relating to jail records and also in support of his contention that the records were kept in a slipshod manner and could not be relied upon for accuracy. The obvious purpose of the testimony of these witnesses was to show that Busbee could have been on the scene in the King Grove on the night of February 4, 1956, even though the jail records, which allegedly had been altered, would have indicated that at the particular time he was actually delivering a prisoner to the jail. One of his witnesses also testified on the subject of the alleged alteration of the records. This led the trial judge to his conclusion that the defendants Gordon and Arnold benefited by the testimony of the witnesses for Busbee and that, therefore, they could not claim the right to open and close.
Interestingly enough, however, the trial judge permitted the appellant King, through his attorneys, to make the opening and closing argument to the jury. If the theory of the trial judge was correct in denying to Gordon and Arnold the right to open and close merely because they received benefit from the testimony of the witnesses offered by Busbee, the same theory would have applied to the appellant King. This is so for the reason that by the 4th count of the indictment appellant King together with Gordon was charged with the crime of subornation of the alleged perjury of appellant Arnold. By the 3rd count King and Gordon were charged with suborning the alleged perjury of Busbee. Obviously, if Arnold and Busbee had been acquitted of perjury, King could not have been convicted of suborning the perjury. Consequently, any testimony that would benefit Arnold or Busbee on the perjury counts would likewise have benefited appellant King.
Gordon and King were in identical positions except that they had separate counsel. Nevertheless, King was permitted the opening and closing argument but the same privilege was denied to Gordon and Arnold. We think the trial judge ruled correctly with reference to King and committed error when he denied to appellants Gordon and Arnold the privilege of the opening and closing argument as against the State.
Gordon and Arnold base their position on the statutory privilege granted to them by Section 918.09, Florida Statutes, F.S.A., which reads as follows:
"In all criminal prosecutions the accused may at his option be sworn as a witness in his own behalf, and shall in such case be subject to examination as other witnesses, but no accused person shall be compelled to give testimony against himself, nor shall any prosecuting attorney be permitted before the jury or court to comment on the failure of the accused to testify in his own behalf, and a defendant offering no testimony in his own behalf, except his own, shall be entitled to the concluding argument before the jury." (Emphasis added.)
The identical question has recently been presented to this court by petition for certiorari *539 seeking review of the decision of the District Court of Appeal of Florida, First District, in Carter and Faulk v. State, 101 So. 2d 911. By our opinion in Faulk v. State, Fla., 104 So. 2d 519, we have disposed of the immediate question favorably to the contention of the appellants Gordon and Arnold. In the opinion last cited we traced in detail the statutory development of the rule and discussed in equally elaborate detail the development of the rule through our own opinions. We think it unnecessary to duplicate the discussion in the instant opinion. We here merely hold that on the authority of Faulk v. State, and the prior decisions of this court therein discussed, the trial judge committed error when under the circumstances here presented he denied to the appellants Gordon and Arnold the privilege of making the opening and closing arguments to the jury as against the State.
In Faulk v. State, we undertook to delineate the historical development of the rule in question primarily to demonstrate that there is nothing new or novel about it. It is thoroughly grounded in the criminal jurisprudence of this state and we sometimes find it difficult to understand why defendants on appeal have so often demonstrated that they have been denied the privilege. As previously pointed out this court did not make the rule. The Legislature made it and therefore we must follow it. Similarly, it is binding on the trial courts. When the privilege given by the statute is denied we have no choice but to point up the error and reverse a conviction even though it may mean an expensive re-trial, as will doubtless follow in the instant case. We have no alternative but to hold that as to the appellants Gordon and Arnold it was error under the circumstances to deny to them their vested privilege of having their attorney deliver the opening and closing arguments to the jury in their behalf.
When the State elected to place all of the appellants on trial collectively it could not thereby deprive a particular defendant of the privilege given by the subject statute even though a co-defendant elected to waive the privilege by offering testimony other than his own. The fact that one defendant might offer testimony that could benefit other defendants was the risk that the State assumed when it elected to charge and try the defendants collectively.
Appellants Busbee and Arnold contend that their trial and subsequent conviction became infected with incurable error when the acting county solicitor in his closing argument to the jury made the following comment:
"Now, we submit the truth of the matter is that Busbee and Arnold were not at the scene, because they couldn't have been. They didn't testify to what happened out there. Because all the other troopers and all the other testimony shows that they were not there. That's our contention. And we think we have shown that.
"But they say, they say they were there. So let's see how the log was changed to support their theory." (Emphasis added.)
When the quoted statement was made by the prosecuting officer no objection was tendered. When the trial judge ultimately charged the jury, he gave an instruction to the effect that a defendant on trial in a criminal case has the right to refrain from testifying and that no adverse inference should be drawn if he elects not to take the witness stand. The judge made no specific reference to the remark of the prosecutor. Nonetheless, appellants Busbee and Arnold assert that the observation of the county solicitor directly commenting on their failure to testify was a violation of their constitutional rights against self-incrimination guaranteed to them by Section 12 of the Declaration of Rights of the Florida Constitution, F.S.A., as well as a direct violation of the provisions of Section 918.09, Florida Statutes, F.S.A., to which we have made reference in discussing another aspect *540 of this appeal. The portion of Section 918.09, Florida Statutes, F.S.A., pertinent to the immediate point, reads as follows:
"* * * but no accused person shall be compelled to give testimony against himself, nor shall any prosecuting attorney be permitted before the jury or court to comment on the failure of the accused to testify in his own behalf, * * *." (Emphasis added.)
Here again we have a specific legislative prescription of a right to be accorded to those under prosecution for crime. Whether we as judges deem the rule to be wise and salutary is of no consequence at all and we assume no responsibility for it. The Legislature made the rule and we must follow it, at least until the Legislature changes it.
As early as Jackson v. State, 45 Fla. 38, 34 So. 243, this court recognized that the prosecuting officer would not be permitted comment on the failure of an accused to take the witness stand even though he does so by innuendo under the guise of disclaiming any intention of doing so. This was in 1903. We have throughout the years consistently adhered to the proposition that this is a binding and obligatory restriction placed on prosecuting officers as an aspect of due process in order to preserve to defendants the full measure of their constitutional privilege against self-incrimination.
Since Rowe v. State, 87 Fla. 17, 98 So. 613, this court has been aligned with the courts of other states which hold that when the prosecuting officer violates this rule, the trial becomes infected with error even though no exception is taken at the time and despite the fact that the trial judge might immediately rebuke the prosecutor for the violation. For the alignment of courts on this proposition see Pollard v. State, 201 Ind. 180, 166 N.E. 654, 84 A.L.R. 779. The courts which apply the rule in this fashion do so for the reason that when the prosecutor brings to the attention of the jury the failure of a defendant to testify, he naturally gives emphasis to the fact that the defendant could have testified if he had so desired and that by failing to do so he has something to hide. Immediately there is created in the mind of the average juror an ill-founded and prohibited prejudice which cannot be erased or eradicated either by apology or by judicial admonition. Barnes v. State, Fla. 1951, 58 So. 2d 157. As so aptly described by Mr. Chief Justice Terrell in Carlile v. State, 129 Fla. 860, 176 So. 862, 864, such a prejudice "clings to the mind like a tattoo on the epidermis". Ordinarily improper remarks of counsel to the jury can be remedied by appropriate instructions by the trial judge. Consequently under ordinary circumstances such inappropriate remarks will not be reviewed by an appellate court unless timely objection is made in the lower court. This rule, however, is subject to the exception that if the improper remarks are of such character that neither rebuke nor retraction may entirely destroy their sinister influence then on appeal they may be considered as error even in the absence of an objection in the trial court. Carlile v. State, supra.
We have repeatedly held that comments by the prosecuting officer on the failure of defendants to testify come within this exception to the general rule. This is so for the reason that when the comment is made the seed of the evil result is sowed and no manner of correction will prevent its fruition into a fixed prejudice against the defendant. In Simmons v. State, 139 Fla. 645, 190 So. 756, this court reaffirmed its traditional position on this subject. Perhaps it is understandable that under the tension of a heatedly contested trial the prosecuting officer will momentarily and even in good faith violate the prescriptions of the statute. We feel certain that this was the situation in the matter before us. Likewise also it is understandable that the prosecutors as well as many others might deem the rule to be unwise and too much for the benefit of the defendant. We are not in a position to *541 elaborate upon the merits of such a viewpoint. Our responsibility as an appellate court is to apply the law as the Legislature has so clearly announced it. We are not endowed with the privilege of doing otherwise regardless of the view which we might have as individuals. Way v. State, Fla. 1953, 67 So. 2d 321. Also see Trafficante v. State, Fla. 1957, 92 So. 2d 811. The harmless error statute, Section 54.23, Florida Statutes, F.S.A., does not apply to this type of error.
By its brief the State makes no effort to distinguish the prior decisions of this court which we have hereinabove cited. On the contrary the State relies entirely on the rule of Gray v. State, 42 Fla. 174, 28 So. 53, and Clinton v. State, 56 Fla. 57, 47 So. 389, 390. In those cases we merely held that the statute does not prohibit legitimate comment on testimony properly before the jury. We held that the prosecutor could comment on conflicts and absence of conflicts. In both of the cases, however, this privilege was specifically circumscribed by the further statement that when the prosecuting officer engages in such discussions before the jury he cannot exercise the right in such fashion "as to make it directly or covertly a comment upon the failure of the accused to voluntarily become a witness." Clinton v. State, supra.
By its brief also the State attempts to defend the remark with the supposition that the prosecuting officer was not referring to the failure of the two defendants to take the witness stand but on the contrary was referring to the proposition that some other witnesses did not testify to what happened. We think that it is perfectly obvious from a casual examination of the quoted statement that the prosecutor could have been referring to no one other than the appellants Busbee and Arnold. Referring back to the statement it will be noted that he mentioned that "Busbee and Arnold were not at the scene because they couldn't have been." In the very next sentence he observed, "They didn't testify to what happened out there." The grammatical proximity of the two sentences and the interchange between the names of "Busbee and Arnold" and the pronoun "they" appear to us to point to the inescapable conclusion that reference was being made to the fact that these two defendants had failed to take the witness stand and testify as to actually what happened.
Again, because of this obvious error, we are compelled to hold that the rights granted to appellants Busbee and Arnold by the subject statute were violated and for the violation their subsequent conviction will have to be reversed.
We comment in passing on the contention of the appellant King that the trial judge committed error in advising the jury that he had requested State Attorney William D. Hopkins of the Second Judicial Circuit to participate in the prosecution of the instant case. The appellants appeared to spend a useless amount of time challenging and questioning the motives as well as the right of Mr. Hopkins to serve as a member of the prosecution's staff.
There is no suggestion in the record that he was doing other than fulfilling a sense of obligation when he complied with the request of the trial judge and participated in the prosecution of this case. It was certainly not inappropriate for the judge to make this explanation to the jury after the appellants themselves had generated such a needless issue over the matter.
What we have written disposes of the major contentions for reversal advanced by the appellants. We have grouped numerous assignments of error in our discussion of the several points covered in detail. In addition appellants have suggested other alleged errors based on rulings of the trial judge in regard to particular testimony, rulings of the trial judge with reference to various pre-trial motions, and the giving and refusing of numerous instructions.
*542 We think it would unduly burden this already lengthy opinion if we were to comment on each of these alleged errors. Many of them are illustrated by those which we have heretofore disposed of in detail and the same rules of law would apply. We have considered the others which do not fall within this category and find that they do not constitute reversible error, the same being either without merit or having no harmful effect on the rights of the appellants.
In the interest of clarity and accuracy in any subsequent application of this opinion we summarize herewith our several holdings as follows:
(a) The alleged false testimony of Busbee and Arnold given before the grand jury was material to the matter under investigation. The trial judge ruled correctly on this point.
(b) Busbee and Arnold testified before the grand jury pursuant to a lawful oath with reference to a matter properly under investigation by that body. The trial judge ruled correctly on this point.
(c) Reversible error was committed in permitting the witness Tillett to testify with reference to his conferences and conversations out of the hearing of any of the appellants. Many of these conversations were pure hearsay and the others mentioned in the opinion were totally immaterial to the issues involved in the trial.
(d) Reversible error was committed in allowing into evidence the grand jury indictment against appellant King charging him with violations of the election laws.
(e) Reversible error was committed by allowing into evidence the testimony of witnesses Smith and Tomasello with regard to cash loans to appellant King and the sources of the money.
(f) Reversible error was committed in denying to appellants a transcript of the grand jury testimony given by appellants Gordon, Busbee and Arnold. Otherwise the ruling of the trial judge on the appellants' motion for a transcript of the grand jury testimony was correct.
(g) Reversible error was committed in denying to appellants Gordon and Arnold the right to the opening and closing jury arguments and allowing the State to open and close as against these two.
(h) Reversible error was committed when in his closing argument the prosecuting officer commented upon the failure of appellants Busbee and Arnold to testify in their own behalf.
(i) No error was committed when the trial judge explained to the jury the reason for participation in the trial by State Attorney Hopkins.
(j) Other errors assigned have been carefully examined and we find that they fall within the categories of those which we have discussed in detail herein or else they are either harmless or no error at all.
It is with some degree of apology that we have found it necessary to extend the length of this opinion. Necessity therefor, we think, is justified by the intricacies of the case, the numerous comprehensive briefs that have been filed, plus the consideration of a trial that lasted for three weeks and produced a record in excess of two thousand three hundred pages. While it may seem regrettable that a case so extensive and so expensive will have to be re-tried, it should be obvious that under our democratic system of administering justice we cannot measure the rights of men accused and convicted of serious crimes by this standard. Who would want it otherwise?
For the errors which we have pointed out it is, therefore, necessary that the judgments under assault be and the same are hereby reversed and the cause is remanded for a new trial.
It is so ordered.
TERRELL, C.J., and THOMAS, HOBSON and O'CONNELL, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/94281/ | 159 U.S. 555 (1895)
MAGONE
v.
WIEDERER.
No. 23.
Supreme Court of United States.
Argued January 25, 1895.
Decided November 18, 1895.
ERROR TO THE CIRCUIT COURT OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK.
*559 Mr. Assistant Attorney General Whitney for plaintiff in error.
Mr. Edward Hartley, (with whom was Mr. Walter H. Coleman on the brief,) for defendant in error.
MR. JUSTICE WHITE, after stating the case, delivered the opinion of the court.
The instructions which were refused asked the court to rule that exclusive use was the correct criterion to determine the classification. The error of this contention seems obvious from the most casual consideration. If exclusive use were made the test, then an exception would destroy the rule; for however general and universal the use of a particular article might be, if exceptionally used for another purpose, such use would destroy the effect of the general and common use, and make the exception the controlling factor. It is urged that if exclusive use is not made the criterion it will be impossible to assess duties, because of the difficulty of ascertaining the chief or general and common use; but it is manifest that this argument of inconvenience is a mistaken one, and that, on the contrary, it would be impossible to resort to use as a criterion *560 of classification if exclusive use must be ascertained in so doing, for that which is generally and commonly done may be known, but that which is so universally done as to be without any exception is difficult, if not impossible, of ascertainment.
The strength of this reasoning has caused counsel, in the discussion at bar, to admit that the correct standard is not exclusive use, which was presented in the first, fourth, and fifth request to charge, but that such test is to be found in the exclusive commercial use which was embraced in the second and third requests. The proposition involves a distinction without a difference. How the line can be drawn between exclusive use and exclusive commercial use, in trade or commerce, is impossible of statement. Indeed, this difficulty is likewise so apparent that in defending the proposition of exclusive commercial use it is defined in the argument to be "known in commerce," but known in commerce is a matter of commercial designation, not of commercial use. Thus it is impossible to state the proposition of exclusive use without being driven by the reason of things to abandon it and seek refuge in the theory of exclusive commercial use, or exclusively used in trade or commerce. It is equally impossible to state this last contention without resolving it into a question of commercial designation. The decisions of this court abundantly support the refusal to give the charges asked. Hartranft v. Langfeld, 125 U.S. 128; Robertson v. Edelhoff, 132 U.S. 614; Cadwalader v. Wanamaker, 149 U.S. 532; Walker v. Seeberger, 149 U.S. 541; Hartranft v. Meyer, 149 U.S. 544; Magone v. Heller, 150 U.S. 70; Sonn v. Magone, 159 U.S. 417. It is urged that Worthington v. Robbins, 139 U.S. 337, and Magone v. Heller (ub. sup.) are in conflict with the other cases above quoted, and therefore such other cases by implication are overruled. The contention is without foundation. It proceeds upon the hypothesis that this court overruled, in 139 U.S., Hartranft v. Langfeld and Robertson v. Edelhoff, when, in 149 U.S., in Cadwalader v. Wanamaker, Walker v. Seeberger, and in Hartranft v. Meyer, it affirmed those cases, and held itself bound by the doctrine of chief use which was there announced. So, also, it presupposes that this court, in Magone *561 v. Heller, in 150 U.S., reversed the doctrine established in a line of carefully considered cases without even making reference to them. It is apparent that the matters decided in Worthington v. Robbins and Magone v. Heller do not conflict with the adjudications of this court, as to the chief or predominant use, which began with the case of Maillard v. Lawrence, 16 How. 251, 261, and has found fuller expression in the line of cases above referred to.
Worthington v. Robbins involved the rate of duty on a certain class of enamel, which it was claimed by the importer was dutiable as watch materials. The court found that the enamel was a raw material, not necessarily material for a watch at all, and not susceptible of being used as such without undergoing a process of manufacture. It was upon this ground the case was decided. Magone v. Heller involved the duty on an article invoiced as "manure salts" which the collector claimed was dutiable as sulphate of potash at 20 per cent ad valorem, and which the importer asserted was free of duty as a substance "expressly used for manure." The proof showed that salts like those in question were used for making fertilizers, that they were sometimes sold to farmers for fertilizing purposes, and that they were also used for making alum, nitrate of potash, and bichromate of potash. In this state of proof the defendant, collector, requested, under the theory of exclusive use, a verdict in his favor, which the court refused, but on the request of the plaintiff instructed a verdict in his behalf. We held that the court rightly refused the instruction for the defendant, which was necessarily an adhesion to the settled doctrine that where use becomes the criterion, exclusive use was not the proper test to apply. We held also that there was error in instructing for the plaintiff, because the question of whether there was chief or predominant use of the imported article as a substance "expressly used for manure," should have been left to the jury, and the case was remanded for that reason. In reviewing the contention we said: "If the only common use of a substance is to be made into manure, or to be itself spread upon the land as manure, the fact that occasionally or by way of experiment it is used for a different *562 purpose will not take it out of the exception. But if it is commonly, practically, and profitably used for a different purpose, it cannot be considered as used expressly for manure, even if in the majority of instances it is so used." It follows that whilst Magone v. Heller adhered to the settled rule of chief use, a guide was there announced by which to discover whether the facts established such chief use. Chief use in itself is a vague and uncertain term. Magone v. Heller, therefore, held that chief use was to be ascertained by that which was commonly, practically, and generally done, and was not to be overthrown by an occasional exception for practical or experimental purposes. Thus, we repeat, Magone v. Heller, whilst enforcing and applying the rule of chief use, furnished the instrument for determining and measuring its operation and giving certainty to its application. It is for this reason that in the recent case of Sonn et al. v. Magone, 159 U.S. 417, Magone v. Heller was cited as authority for and in elucidation of the correct test by which use as a measure of classification was to be controlled. The charge given by the court below, and which was excepted to, was manifestly correct, for in giving the rule of chief use the principles by which chief use was to be ascertained were fully stated exactly in accordance with the law subsequently announced by this court in Magone v. Heller.
Affirmed. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/94315/ | 160 U.S. 217 (1895)
INTERIOR CONSTRUCTION AND IMPROVEMENT COMPANY
v.
GIBNEY.
No. 99.
Supreme Court of United States.
Argued December 6, 1895.
Decided December 16, 1895.
ERROR TO THE CIRCUIT COURT OF THE UNITED STATES FOR THE DISTRICT OF INDIANA.
*218 Mr. John C. Donnelly for plaintiff in error.
*219 No appearance for defendant in error.
MR. JUSTICE GRAY, after stating the case, delivered the opinion of the court.
The record shows that the only matter tried and decided in the Circuit Court was a demurrer to the plea to the jurisdiction; and the petition, upon which the writ of error was allowed, asked only for the review of the judgment that the court had no jurisdiction of the action. The question of jurisdiction alone is thus sufficiently certified to this court, as required by the act of March 3, 1891, c. 517, § 5. 26 Stat. 828; In re Lehigh Co., 156 U.S. 322; Shields v. Coleman, 157 U.S. 168.
The act of March 3, 1887, c. 373, as corrected by the act of August 13, 1888, c. 866, confers upon the Circuit Courts of the United States original jurisdiction of all civil actions, at common law or in equity, between citizens of different States, in which the matter in dispute exceeds, exclusive of interest and costs, the sum or value of $2000; and provides that "where the jurisdiction is founded only on the fact that the action is between citizens of different States, suit shall be brought only in the district of the residence of either the plaintiff or the defendant." 24 Stat. 552; 25 Stat. 433.
The Circuit Courts of the United States are thus vested with general jurisdiction of civil actions, involving the requisite pecuniary value, between citizens of different States. Diversity of citizenship is a condition of jurisdiction, and, when that does not appear upon the record, the court, of its own motion, will order the action to be dismissed. But the provision as to the particular district in which the action shall be brought does not touch the general jurisdiction of the court over such a cause between such parties; but affects only the proceedings taken to bring the defendant within such jurisdiction, and is a matter of personal privilege, which the defendant may insist upon, or may waive, at his election; and the defendant's right to object that an action, within the general jurisdiction of the court, is brought in the wrong district, is waived *220 by entering a general appearance, without taking the objection. Gracie v. Palmer, 8 Wheat. 699; Toland v. Sprague, 12 Pet. 300, 330; Ex parte Schollenberger, 96 U.S. 369, 378; St. Louis & San Francisco Railway v. McBride, 141 U.S. 127; Southern Pacific Co. v. Denton, 146 U.S. 202, 206; Texas & Pacific Railway v. Saunders, 151 U.S. 105; Central Trust Co. v. McGeorge, 151 U.S. 129; Southern Express Co. v. Todd, 12 U.S. App. 351.
In Smith v. Lyon, 133 U.S. 315, this court held that the provision of the act of 1888, as to the district in which a suit between citizens of different States should be brought, required such a suit, in which there was more than one plaintiff or more than one defendant, to be brought in the district in which all the plaintiffs, or all the defendants, were inhabitants.
When there are several defendants, some of whom are, and some of whom are not, inhabitants of the district in which the suit is brought, the question whether those defendants who are inhabitants of the district may take the objection, if the non-resident defendants have not appeared in the suit, has never been decided by this court. Strong reasons might be given for holding that, especially where, as in this case, an action is brought against the principals and sureties on a bond, and one of the principals is a non-resident and does not appear, the defendants who do come in may object, at the proper stage of the proceedings, to being compelled to answer the suit.
But in the present case it is unnecessary to decide that question, because one of the principals and both sureties, being all the defendants who pleaded to the jurisdiction, had entered a general appearance long before they took the objection that the sureties were citizens of another district. Defendants who have appeared generally in the action cannot even object that they were themselves inhabitants of another district, and, of course, cannot object that others of the defendants were such.
Judgment reversed, and case remanded with directions to sustain the demurrer to the plea, and for further proceedings not inconsistent with this opinion. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/3398586/ | On petition for writ of certiorari, motion to dismiss the petition was filed and the case has been brought on for hearing on petition, motion to dismiss and the merits. Briefs have been filed by all interested parties; oral argument has been had and the issues involved considered by the court.
The petitioners contend that the Railroad Commission in the determination of its judgment on the application of Tamiami Trail Tours, Inc., and in entering its order pursuant thereto, departed from the essential requirements of law.
Petitioner on May 27, 1935, filed its application with the Railroad Commission of the State of Florida for an extension of its certificate of public convenience and necessity No. 28, seeking the right to operate as a common carrier of passengers and light express, two schedules daily, between Tampa, Florida, and the Georgia-Florida State Line via Brooksville, Inverness, Dunnellon, Williston, Cross *Page 27
City, Perry and Tallahassee, over State Highways Nos. 5, 19 and 10.
A hearing was had; testimony was taken and the Commission entered an order No. 811, denying the petition.
Mr. Commissioner Carter did not agree with a majority of the Commission and filed his separate opinion dissenting from the views expressed by the majority.
On the 5th of May, 1936, petitioner filed amendment to the application and motion for rehearing, both phases of which were denied by order of May 7th, 1936.
It is contended here that certiorari will not lie because the order involved was a negative one. This contention is not tenable because, as we have heretofore stated, "the determinative order granting or denying the right or privilege under the statute may be quasi judicial in its nature and have the quality or finality making a writ of certiorari a proper means for a permissible judicial view of the order where no other remedy is afforded by law." See Fla. Motor Lines, Inc., v. R.R. Commission, 100 Fla. 538, 129 So. 876; also Central Truck Lines, Inc., v. R.R. Commission, 118 Fla. 555, 160 So. 26.
In Mr. Commissioner Carter's dissenting opinion he said:
"Section 3 of Chapter 14764, Acts of 1931, provides that when the Railroad Commission in considering an application for Certificate of Public Convenience and Necessity, such as that of Tamiami Trail Tours, Inc., herein, the interest of the territory as a whole is paramount in importance, as against the personal interest of a particular transportation company.
"The State of Florida is now the tourist mecca of the United States, so much so that its appeal increases annually many fold, and the lower East Coast occupies the center of attraction. Already the East Coast enjoys the great advantages *Page 28
of unexcelled bus transportation, which transportation business is within the exclusive hands of a single company. And the dangerous congestion of traffic and the excessive burden of travel on the East Coast highways serving the lower portion of the State on the Atlantic are emphasized and pictured by that single transportation company, to this commission, on every occasion when any attempt is made by any other auto transportation company to invade its said vast exclusive domain.
"The only other outlet to and from the lower East Coast, than the highways along the Atlantic Seaboard already overburdened with travel according to the many representations made to this Commission, is the Tamiami Trail from Miami to Tampa and thence North via the West Coast of Florida. So, in justice to the East Coast itself, affording only reasonable facilities for normal growth in the very near future, I think that first class through
bus transportation should be provided to and from Miami over the Tamiami Trail and the excellent highway system of West Florida.
"The application of Tamiami Trail Tours, Inc., contemplatesthrough bus transportation to and from Miami via the Tamiami Trail, Tampa, Dunnellon, Williston, Perry, Tallahassee, and the Georgia-Florida State line; and the extension of this through bus transportation into Atlanta, thence into the great cities of the Northwestern and Central States in interstate commerce. The record in this case discloses such anticipated service, even though the application be for an intrastate certificate. The Commission also has before it an application for approval of assignment of a certificate to Tamiami Trail Tours, Inc., covering a bus operation into Georgia with connections to Atlanta and the populous cities of the North and West. So, in my opinion, *Page 29
the proposed service offered by Tamiami Trail Tours, Inc., offers to the West Coast of Florida a through bus service via Tampa, and over the Tamiami Trail into Miami, equal to the bus service already enjoyed down the East Coast. And, in my opinion, the lower East Coast is entitled to this additional means of growth and development. The intervening West Coast would then naturally enjoy a through bus system that cannot possibly be initiated and developed on local travel alone. Tourist and through travel are absolutely essential to the successful operation of a first class bus system on the West Coast of Florida, the same as it is on the East Coast. Not one-tenth of the bus service now enjoyed by the East Coast cities could be operated were it dependent on local travel alone. I think that the East Coast would materially benefit from a through bus system into Miami via the Tamiami Trail, and directly from the great cities of the Northwestern and Central States, and I know that the West Coast of Florida could enjoy a first class through bus system via Tallahassee (The State Capital and site of the Florida State College of Women), by virtue of being supplemented by revenues from such tourist and through travel, such as it is not now enjoying.
"In my opinion, Tamiami Trail Tours, Inc., has amply shown public convenience and necessity for the Certificate it applied for. This finding undoubtedly was also made by the majority of the Commission, for an improved service (but with several interchanges of buses) has been ordered. Of course, I do not disapprove of any improvement of bus service, but I think that the continuous through service afforded by the applicant is far superior, and will mean more for the territory in question, than the service which the majority of this Commission has ordered — for that service does not constitute a through service, but consists *Page 30
of the joint services of four separate bus companies necessitating equally as many stop-overs or interchanges between buses by a passenger traveling the route.
"At the time Tamiami Trail Tours, Inc., made its application there was no adequate service between Tampa and points South of Tampa, to Tallahassee and the north."
The Commission in its Order No. 811 denied the application of both Whiting and Hayes and of Tamiami Trail Tours, Inc., for certificate of public convenience and necessity covering the route from Tampa via Dunnellon, Williston, Cross City, Perry and Tallahassee.
In the opinion it is said:
"While the evidence in this case tends to show that that part of the `public' residing in that territory between Tampa and Fort Myers and Miami, known as the West Coast of Florida, is suffering to some extent from a lack of through transportation facilities that would enable it to promptly reach Tallahassee and contiguous territory in West Florida, and that such a through service as is proposed by Tamiami Trail Tours, Inc., would be of great convenience to this part of the public, yet this Commission is unable to say that an affirmative showing has been made before it `that public convenience and necessity of the public,' whose interest is paramount in such cases, demands the granting of a new service that will tend to impair the existing competitive advantage enjoyed by the Florida Motor Lines, Inc., and Gulf Crescent Motor Lines, Inc., which companies almost completely occupy this particular field of transportation."
The finding of fact as stated in the last above quoted paragraph is, in effect, a finding that under the law as heretofore construed by this Court, the Petitioner, Tamiami Trail Tours, Inc., had met the burden resting upon it as a *Page 31
basis for having issued to it a certificate of public convenience and necessity covering the route over which it proposed to operate.
The record amply supports the contention that the Commission departed from the essential requirements of law in denying the petition of Tamiami Trail Tours, Inc., for a certificate of public convenience and necessity and, therefore, the Order denying the same should be quashed.
The writ of certiorari is awarded. The motion to dismiss is denied and the order of the Railroad Commission sought to be reviewed is quashed.
So ordered.
ELLIS C.J., and WHITFIELD, TERRELL, BUFORD and DAVIS, J.J., concur.
BROWN, J., concurs in conclusion.
ON REHEARING. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3857971/ | Argued March 23, 1949.
The libellant seeks a divorce from his wife in this uncontested action on the ground of desertion. The court below adopted the recommendation of the master that a decree in divorce be refused and dismissed the libel. The sole issue on this appeal is whether there was a consentable separation or a wilful and malicious desertion by the wife. We disagree with the conclusion *Page 338
of the learned court below that the separation was consentable and we find the separation constituted a wilful and malicious desertion by the respondent, warranting an award of a divorce to the libellant.
Four days after the parties married on January 12, 1942, the husband entered the army and remained in the service until his discharge in October, 1945. During that service, excepting of course the three year period spent in the European theatre of operations, the libellant secured frequent weekend furloughs which were passed with his wife in Bucks County, either in the home of his or her parents. The parties lived together in the home of libellant's father for three weeks after his discharge from the army and immediately preceding the separation which occurred on or about November 1, 1945. Apparently the marital relations prior to the separation were entirely harmonious and very pleasant. Any excusatory cause for the separation or for her withdrawal from his home must be gleaned from the libellant's testimony for, as already observed, respondent did not testify.
We have repeatedly said that desertion which entitles an injured or innocent spouse to a divorce is "an actual abandonment of matrimonial cohabitation, with an intent to desert, wilfully and maliciously persisted in, without cause, for two years": Ingersoll v. Ingersoll, 49 Pa. 249, 251. See section 10, "The Divorce Law" of May 2, 1929, P. L. 1237, as amended, 23 P. S. § 10. Guilty intent is manifested where, without cause or consent, either party withdraws from the residence of the other. "The malice of the desertion arises from its being the perverse act of the one, in refusing the performance of the matrimonial obligations and duties, which the other has the legal right to require": Kelly v. Kelly, 51 Pa. Super. 603,608.
"The withdrawal by the wife from the common domicile and cessation of marital relations imposed upon her the burden of proof to establish by the preponderance of the evidence facts that would entitle her to a decree *Page 339
of divorce (citing cases) or that the separation was by consent": Ewing v. Ewing, 140 Pa. Super. 448, 449,14 A.2d 149. "The defense of a separation with the consent of libellant is affirmative and the burden of proof to establish that fact by satisfactory evidence is on the respondent (citing cases)": Hagen v. Hagen, 159 Pa. Super. 539, 541,49 A.2d 193; Tatem v. Tatem, 164 Pa. Super. 307, 312,64 A.2d 514. However, the reason of the rule ceases where the libellant by his own evidence shows such consent to a separation as to negative a wilful and malicious desertion by the respondent. By such evidence the libellant establishes a defense to his own action as much as if the same facts were proved by the respondent.
In concluding that consentable separation was established by the evidence of the libellant himself the learned court below erred. The germane testimony bearing on the separation is substantially as follows: ". . . one evening she said she didn't love me any more and she said she was leaving me. I told her that it was all right, that she could leave, and when she decided whichever way she wanted it, that I would still have a home for her and still be waiting for her. That was three weeks after I arrived from the other side after three years on the other side. . . . I told her that maybe being away three years caused a little trouble at heart, that maybe after she had been away for a few days or so she would come back again. . . . About two or three months, and I tried to reconcile with her again and told her still if she changed her mind I would still be waiting and still have a home prepared for her. . . . Well, she still didn't want to come back with me. She thought we should call it quits, and she still didn't love me, and I told her to think it over a while and still it hasn't materialized. . . . BY MR. GRAY: Q. You were trying then — if I understand it correctly, you were trying to be nice to her so that she would return? A. That is right. *Page 340
Q. You didn't want to make any scene or anything? A. I didn't want to make any scene, just trying to see that she would come back with me again."
The foregoing testimony rather clearly shows the libellant was hopeful his wife's departure would be a temporary one. He did not consent to a permanent separation; he did not contemplate that status at the time of the separation. He consented to nothing more than a temporary separation and such consent was only given because, recognizing the futility of presenting dissuasive reasons to her immediate departure, he deemed his acquiescence to a temporary separation, if conveyed to her as amicably and pleasantly as circumstances suggested or permitted, might avert a permanent separation developing from a short separation. Moreover, he thought a gracious attitude by him might pave the way to an earlier and unembarrassing rekstablishment of marital relations. Subsequent events dissipated his optimism but that is not good reason to penalize him for honest and sincere errors of judgment, free of guile and fabrication. To say that he should have discerned the full nature of her act, i. e., the permanency of her separation, is to require of the libellant in the circumstances the exercise of powers of clairvoyance. "His [acquiescence] indicated not consent, which implies volition, but passive submission to an unhappy misfortune over which he had no control. If he consented to anything, it was to nothing more than a temporary separation (citing cases)": Westfall v. Westfall, 148 Pa. Super. 477,480, 25 A.2d 614. "A consent to a temporary separation, as here, does not bar a libellant from obtaining a divorce for desertion if, in fact, there was an abandonment of a common habitation, without sufficient consent, for the statutory period": Hagen v. Hagen, 159 Pa. Super. 539,541, 49 A.2d 193, supra. *Page 341
The respondent had no reason to leave; libellant's consent thereto implies no volition but rather a supplicatory resignation to and a reluctant acknowledgment of a supposedly temporary marital breach. His consent was given not as much in aid of a temporary separation or in approbation of that status as it was offered as an entreaty for its early termination. The evidence therefore does not approximate the requirement of the law that there must be proof of affirmative conduct, amounting to participation in the separation, to defeat a divorce in this type of desertion cases. No inference can fairly be drawn that he was as willing to have his wife go as she was willing to leave. Mertz v. Mertz, 119 Pa. Super. 538, 180 A. 708. Cf. Barnes v. Barnes, 156 Pa. Super. 196, 40 A.2d 108. He was willing that she return at any time and terminate the separation which she alone had charted as the permanent status, unknowingly to him.
Croll v. Croll, 60 Pa. Super. 415, upon which the lower court heavily relied is wholly dissimilar to this action on the facts, is easily distinguishable and does not support a refusal of divorce. The libellant is entitled to the relief sought and a decree in divorce should be awarded.
The decree of the court below is reversed, the libel is reinstated, and the record is remitted to the court below with direction to enter a decree of absolute divorce. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1714435/ | 104 So. 2d 113 (1958)
The STATE of Florida, Petitioner-Appellant,
v.
J.K., a minor, Respondent-Appellee.
No. 554.
District Court of Appeal of Florida. Second District.
June 25, 1958.
*114 Richard W. Ervin, Atty. Gen., David U. Tumin, Asst. Atty. Gen., Clair A. Davis, State Atty., St. Petersburg, B.J. Driver, Asst. State Atty., Clearwater, for petitioner-appellant.
Mann, Harrison & Mann, Sam H. Mann, Jr., St. Petersburg, for respondent-appellee.
ALLEN, Acting Chief Judge.
The petitioner seeks review, by certiorari, of an order of the circuit court which reversed an order by the Juvenile Court for Pinellas County. The order reversed had committed respondent minor to the Florida School for Girls at Ocala on the grounds that respondent was a delinquent girl.
The respondent appealed the judgment to the Circuit Court of Pinellas County, and on January 10, 1958, the circuit court entered an order reversing the juvenile court on the ground there was not "competent legal evidence to sustain the finding that the said J.K. was a delinquent child as charged". Petitioner prays for a writ of certiorari on the grounds:
1. That the Circuit Judge erred in his finding as to "competent legal evidence".
2. That the Circuit Judge erred by substituting his findings for those of the Juvenile Judge, contrary to Sec. 39.14(8), Fla. Stat. 1955, F.S.A.
3. The Circuit Judge proceeded contrary to the essential requirements of law.
This court shall not further allude to the grounds hereinabove set forth as the court is of the opinion that the circuit court had no jurisdiction to hear this case on an appeal from the juvenile court, and since any order entered by the circuit court would be void and must be quashed, the judgment of the juvenile court would remain in full force and effect.
The appeal to the circuit court was taken subsequent to July 1, 1957, the effective date of Article V of the Constitution of the State of Florida, adopted November 6, 1956, F.S.A.
*115 The appellate jurisdiction of the circuit court is found in Art. V, Section 6(c) and is as follows:
"* * * They shall have final appellate jurisdiction in all civil and criminal cases arising in the county court, or before county judges' courts, of all misdemeanors tried in criminal courts of record, and of all cases arising in municipal courts, small claims courts, and courts of justices of the peace. The circuit courts and judges shall have power to issue writs of mandamus, injunction, quo warranto, certiorari, prohibition, and habeas corpus, and all writs necessary or proper to the complete exercise of their jurisdiction."
The jurisdiction of the district courts of appeal, as set forth in Art. V, Section 5(c), is as follows:
"Appeals from trial courts in each appellate district, and from final orders or decrees of county judge's courts pertaining to probate matters or to estates and interests of minors and incompetents, may be taken to the court of appeal of such district, as a matter of right, from all final judgments or decrees except those from which appeals may be taken direct to the supreme court or to a circuit court."
The jurisdiction of the Supreme Court set forth in Art. V, Section 4(b), is as follows:
"Appeals from trial courts may be taken directly to the supreme court, as a matter of right, only from judgments imposing the death penalty, from final judgments or decrees directly passing upon the validity of a state statute or a federal statute or treaty, or construing a controlling provision of the Florida or federal constitution, and from final judgments or decrees in proceedings for the validation of bonds and certificates of indebtedness. The supreme court may directly review by certiorari interlocutory orders or decrees passing upon chancery matters which upon a final decree would be directly appealable to the supreme court. In all direct appeals and interlocutory reviews by certiorari, the supreme court shall have such jurisdiction as may be necessary to complete determination of the cause on review."
It will be observed from the foregoing enumeration of appellate powers given to the Supreme Court, to the courts of appeal and to the circuit courts, that all appeals from trial courts must be taken to the court of appeal unless, under the Constitution, such appeal may be taken direct to the Supreme Court or to a circuit court.
The question then arises whether a juvenile court is a trial court. Chapter 39, Florida Statutes, F.S.A., provides for juvenile courts. Section 39.01 provides that a juvenile court means any court, the name of which includes the word "juvenile", heretofore or hereafter established, and means the county judge's court in every county in which no separate juvenile court is established.
Section 39.02 provides:
"The juvenile court shall have exclusive original jurisdiction of dependent and delinquent children domiciled, living or found within the county or district in which the court is established. The juvenile court of the county or district in which the child is found shall assume jurisdiction of the child, which jurisdiction shall be exclusive unless the judge thereof, upon approval of the judge of the juvenile court of the county or district in which is located the domicile or usual residence of the child, shall transfer the case and child to the latter court, before or after hearing, in which event the latter court shall thereafter exercise exclusive jurisdiction."
The juvenile court, under section 39.02, Florida Statutes, is given power to revoke or suspend the driver's license of a child *116 under various conditions; if a charge is pending in any court of the State or of any city or town against a person presumed to be an adult and it is ascertained that the person is a child or was a child at the time the offense was committed, that court shall transfer the case, together with the physical custody of the child and all evidence, etc., to the juvenile court. The juvenile court is also exclusively authorized to assume jurisdiction over any delinquent child arrested and charged with violating a federal law or a law of the District of Columbia when the child is surrendered to the juvenile court as provided in Title 18 U.S.C. § 5001, and the judge of the juvenile court has the jurisdiction of a committing magistrate, etc.
A study of Chapter 39, supra, will show the broad powers given to the juvenile court by said chapter. To this court, the conclusion is inescapable that the juvenile judge acts as a trial judge. Therefore, under the Constitution, an appeal must be brought to this court and not to the circuit court.
Chapter 39.14 provides that any child and any parent or legal custodian of any child affected by an order of the juvenile court, excluding such order as the judge may make as committing magistrate, may appeal to the circuit court of the circuit within which the juvenile court is established. Prior to the effective date of the constitutional amendment creating the district courts of appeal, the statutory method of appeal from juvenile courts was, therefore, to the circuit court.
The effect of the constitutional amendment providing for the appellate jurisdiction of the circuit courts and courts of appeal, as well as the Supreme Court, was to render nugatory the appeal provision hereinabove set forth.
The Supreme Court of Florida, in the recent case of Codomo v. Shaw, Fla. 1958, 99 So. 2d 849, 851, held that under the new constitutional provisions, authority for statute providing for an appeal to the circuit court from a final order of the Real Estate Commission was removed by elimination of the constitutional provision giving circuit courts jurisdiction of such matters as the Legislature might provide, and therefore, that appeal would not lie to the circuit court from a final order of the Real Estate Commission suspending registration of real estate brokers. The Court, in its opinion, said:
"We next consider the possibility of an appeal to the circuit court pursuant to F.S. § 475.35, F.S.A., supra. We note that former Article V, Section 11, of the constitution provided for final appellate jurisdiction in the circuit courts as to certain specified matters `and of such other matters as the Legislature may provide'. Thus the authority upon which F.S. § 475.35, F.S.A., rested was clear. The quoted language, however, was eliminated from new Article V, Section 6 (the present counterpart of former Section 11) in connection with final appellate jurisdiction, although this language was retained in connection with original jurisdiction. This elimination of the enabling language, to our mind, demonstrates an intention on the part of the framers to remove the support for F.S. § 475.35, F.S.A., and the statute, accordingly, must fall. * * *"
We reach the conclusion that the circuit court of the Sixth Judicial Circuit had no jurisdiction to act as an appellate court in this case.
The appellee, in its last brief, filed by permission of the court, requests this court, if it should hold that the circuit court was without jurisdiction to hear this case on appeal, to utilize the provisions of Rule 2.1, subd. a(5) (d), Florida Appellate Rules 1957, 31 F.S.A., to transfer this case to the court having jurisdiction. We regret our inability to grant this request. The Rule referred to authorizes an appellate court, where its jurisdiction has been improvidently *117 invoked, to transfer the case on its own motion or on motion of either party, to the court that would have jurisdiction. Since the jurisdiction of the court of appeal was properly invoked by the petition for certiorari, we are not authorized to act under this Rule.
Certiorari is granted and the order here reviewed is quashed with directions to remand the cause to the juvenile court.
SHANNON, J., and SPOTO, Associate Judge, concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3398640/ | Affirmed.
CHAPMAN, C. J., TERRELL, BUFORD and ADAMS, JJ., concur. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/3990709/ | The appellant was charged by the prosecuting attorney of Jefferson county, the information containing two counts alleging violations of the state liquor law, tried to a jury and found guilty.
This appeal follows, and but two errors are argued: First, that the court unduly restricted the cross-examination of the state's witnesses; second, that the court unduly limited counsel for the defense in his argument to the jury.
[1] The limitation of the cross-examination of the state's witnesses arose as follows: The sheriff of Jefferson county, a deputy sheriff and an under-cover man working for the sheriff's office, were each asked on cross-examination by the defendant's counsel substantially *Page 156
the following question: "Have you, within the last two years, bought or sold liquor?" To this question, objection was made and sustained.
That the ruling of the trial court was correct, is settled by the recent case of State v. Gaffney, 151 Wash. 599,276 P. 873, where this court said:
"A careful examination of the authorities satisfies us that the decision of this court in the case of State v. Smith,145 Wash. 250, was incorrect. The true rule is that the character of a witness may be shown by general reputation, and not by cross-examination as to specific acts of insinuated immorality along the line attempted to have been followed by appellants in the case at bar."
[2] When the case was being argued to the jury, counsel for defendant stated: "I want to call your attention to an article in the Literary Digest," whereupon the following took place:
"THE COURT: You cannot read that.
"MR. TRUMBULL: I would like the record to show that the defendant is about to read from statistics from the Literary Digest, and denied the privilege by the court, to which he excepts.
"THE COURT: The record will so show."
While it is true that great latitude must be allowed counsel in arguing to the jury, and while it is likewise true that pertinent quotations may ofttimes be properly made, yet matters such as this must necessarily rest largely within the sound discretion of the trial court, and there is no showing made in this case to indicate that the defendant was in any way prejudiced by the refusal of the trial court to permit his counsel to read "statistics from the Literary Digest."
Judgment affirmed.
MITCHELL, C.J., FULLERTON, MAIN, and HOLCOMB, JJ., concur. *Page 157 | 01-03-2023 | 07-06-2016 |
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