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https://www.courtlistener.com/api/rest/v3/opinions/1552220/ | 41 B.R. 255 (1984)
In re Darrell W. LIPSEY, Debtor.
AMERICAN BANK AND TRUST CO. OF PA., Plaintiff,
v.
Darrell W. LIPSEY, Defendant.
Bankruptcy No. 83-04647G, Adv. No. 84-0147G.
United States Bankruptcy Court, E.D. Pennsylvania.
June 26, 1984.
*256 Clemson N. Page, Jr., Bingaman, Hess, Coblentz & Bell, Reading, Pa., for plaintiff, American Bank and Trust Co. of Pa.
Steven G. Dubin, Adrienne I. Greenfield, Jerold S. Berschler, Solomon & Berschler, P.C., Norristown, Pa., for debtor/defendant, Darrell W. Lipsey.
Jonathan H. Ganz, Philadelphia, Pa., trustee.
OPINION
EMIL F. GOLDHABER, Bankruptcy Judge.
The issue at bench is whether a debt incurred by a debtor through the use of his credit cards within seven months preceding the filing of his petition for relief under chapter 7 of the Bankruptcy Code ("the Code") is nondischargeable pursuant to § 523(a)(2)(A) of the Code. We conclude that, under the circumstances of this case, the debt is nondischargeable.
The facts of the case are as follows:[1] Darrell W. Lipsey ("the debtor") was issued a Master Card charge plate ("Master Card") and a Visa charge plate ("Visa Card") by American Bank and Trust Company of Pennsylvania ("the creditor") in March of 1983. From April through September, the debtor made purchases of goods and services using those credit cards, for total charges of $3,070.25.[2] During that five month period he made payments on the two accounts totalling $55.00. And this amount reflects two $15.00 payments in April for annual account fees, and one $25.00 payment in June for unspecified goods and services.
*257 Although the debtor changed his address sometime after April 6, there is nothing in the record to indicate that he did not receive account statements directed to his former address before the creditor learned of his new address in September.
The debtor's Master Card charge account became past due and exceeded the available credit limit of $1,000.00 in August. His Visa account became delinquent in August and went overlimit in September. During this period, the debtor made a number of purchases at amounts below $50.00. The creditor wrote and telephoned the debtor in August and September, informing him that the accounts were past due and over limit and that he must return the credit cards if he did not reduce the balances below the credit limits. The creditor received the credit cards in the mail on September 14.
The creditor filed suit against the debtor in state court to collect the debt, and the complaint was served on the debtor on November 29. Two days later, the debtor filed a petition for relief under chapter 7 of the Code. In February, the creditor filed the instant complaint to determine the nondischargeability of the debt. During the course of the evidentiary hearing, the debtor's apparent suggestibility on the stand, coupled with the contradictory testimony of the creditor's account supervisor, cast doubt on the debtor's credibility with respect to his ability or his intention to pay when he made the purchases.
The creditor avers that the instant debt is nondischargeable pursuant to § 523(a)(2)(A) of the Code because the debtor used the credit cards to make purchases at a time when he was unable, and therefore did not intend, to pay for them.
Section 523 of the Code provides in pertinent part:
(a) A discharge under section 727, 1141, or 1328(b) of this title does not discharge an individual debtor from any debt
* * * * * *
(2) for obtaining money, property, services, or an extension, renewal, or refinance (sic) of credit, by
(A) false pretenses, a false representation, or actual fraud other than a statement respecting the debtor's or an insider's financial condition[.]
11 U.S.C. § 523.
In order to prevail under § 523(a)(2)(A), the plaintiff/creditor must prove that: (1) the debtor made a materially false representation; (2) with the intent to deceive; and (3) that the creditor relied on that false representation. See, e.g., H.C. Prange Co. v. Schnore (In re Schnore), 13 B.R. 249 (Bankr.W.D.Wis. 1981); Ranier Bank v. Poteet (In re Poteet), 12 B.R. 565 (Bankr.N.D.Tex.1981); Barnett Bank v. Pitts (In re Pitts), 10 B.R. 557 (Bankr.M.D.Fla.1981).
A credit card holder's use of his credit card is regarded as an implied representation to the credit card issuer that the holder has both the ability and the intention to pay for his purchases, upon which the issuer relies in extending credit. See, e.g., Southeast Services, Inc. v. Vegh (In re Vegh), 14 B.R. 345 (Bankr.S.D.Fla.1981); Schnore, 13 B.R. 249; Poteet, 12 B.R. 565; Pitts, 10 B.R. 557; Huntington National Bank v. Schartner (In re Shartner), 7 B.R. 885 (Bankr.N.D.Ohio 1980); First National Bank & Trust Co. v. Stewart (In re Stewart), 7 B.R. 551 (Bankr.M.D.Ga.1980). "Thus, a purchase of goods on credit by a debtor who does not intend to pay therefor, constitutes false representation. . . ." 3 Collier on Bankruptcy ¶ 523.08 (15th ed. 1982).
The frauds included under § 523(a)(2)(A) require moral turpitude or intentional wrong, and it must affirmatively appear that the representations were knowingly and fraudulently made. Luft v. Slutzky (In re Slutzky), 22 B.R. 270 (Bankr.E.D.Mich.1982).
"Intention [to deceive] of course is a very subjective thing and in most instances can only be shown circumstantially. Nonetheless, if the appropriate factors are shown *258 the Court, this intention may be established." Stewart, 7 B.R. 551. We have adopted the following guidelines which we use, in conjunction with other criteria, in evaluating whether the requisite intention to deceive exists within the meaning of § 523(a)(2)(A):
1. the length of time between the charges made and the filing of bankruptcy;
2. whether or not an attorney has been consulted concerning the filing of bankruptcy before the charges were made;
3. the number of charges made;
4. the amount of the charges;
5. the financial condition of the debtor at the time the charges are made; and
6. whether the charges were above the credit limit of the account.
Philadelphia National Bank v. Brackin (In re Brackin), 23 B.R. 984 (Bankr.E.D. Pa.1982); Philadelphia National Bank v. Petrini (In re Petrini), 23 B.R. 981 (Bankr. E.D.Pa.1982); Strawbridge & Clothier v. Ciavarelli (In re Ciavarelli), 16 B.R. 369 (Bankr.E.D.Pa.1982); Stewart, 7 B.R. 551.
Whenever a credit card holder uses his credit card, he is representing that he has both the ability and the intention to pay for those purchases and the credit card issuer relies on those implied representations in extending credit to the card holderthus, the creditor must usually only establish that the debtor used his credit card to deceive the creditor into believing that the debtor could and would repay the debt when, in fact, the debtor did not intend to do so.
Ciavarelli, 16 B.R. 370.
An examination of the timing, number, amount and type of the purchases, as well as of the debtor's payment record and ability to pay at the time when the purchases were made, lead us to the conclusion that the debtor intended to deceive when he used the credit cards.
The fifty-nine charges in question were made during a five month period from April through September.[3] The debtor attempts to distinguish this case from others in which we have found debts nondischargeable, on the basis that the debtor did not embark on a shopping spree immediately before the filing of the petition. Petrini, 23 B.R. 981; Ciavarelli, 16 B.R. 369. We do not find this argument compelling. Although the final purchase was made nearly three months before the filing of the petition, the charges up to that time were significant both in number and amount, and came to an abrupt halt only when the debtor's credit privileges were revoked.
Although there is no evidence that the debtor had consulted an attorney regarding the filing of a petition before the purchases were made,[4] this fact alone does not establish the debtor's lack of intent to deceive.
Whether a purchase may be classified as a necessity or a luxury item is a relevant consideration in any analysis concerning debtor intent. Ciavarelli, 16 B.R. 369. The fact that the items purchased in the case presently at bench were, for the most part, luxury items,[5] supports our conclusion that the debtor did not intend to pay for them.
An August 6 Visa statement included the information that a portion of the account was past due. The following week, the debtor used his Visa Card to make four separate purchases at amounts below $50.00 ($41.00, $39.00, $41.00, $38.00) at the same retail establishment. In addition to *259 an August 6 Master Card statement which included the information that the account was overlimit, the creditor mailed an August 16 delinquency notice and a September 2 overlimit letter to the debtor. On September 7, the debtor used his Master Card to make two separate purchases at amounts below $50.00 ($29.00, $31.19) at another retail establishment.
An inference of fraudulent intent may be drawn from multiple purchases under the credit line. In Re Nolan, 1 B.R. 644 (Bankr.M.D.Fla.1979); Lincoln First Bank, N.A. v. D'Amico (In Re D'Amico), 1 B.R. 170 (Bankr.W.D.N.Y.1979); Stewart, 7 B.R. 551; Vegh, 14 B.R. 345. We believe that the inference is warranted in the instant case.
At the time that the debtor returned the Master Card and the Visa Card, the available credit limits had been exceeded by approximately $600.00 and $300.00, respectively. Moreover, of the Master Card amount, $291.71 is attributable to seven purchases that the debtor made after being notified that the account was over limit. Exceeding credit card limits is an appropriate factor to consider in establishing proof of intent to deceive within the meaning of § 523(a)(2)(A). First National Bank v. Wright (In Re Wright), 8 B.R. 625 (Bankr. S.D.Ohio 1981); Poteet, 12 B.R. 565.
As we indicated above, of the debtor's total payment of $55.00 on the accounts, only $25.00 was for purchases, with the balance paid for the use of the cards. This fact does not support the contention that the debtor intended to pay for the purchases.
We find, following an overall analysis of the facts of the situation presently at bench, that the debtor's conduct constituted fraud. While we are mindful that any exception to the debtor's statutory right to discharge must be construed liberally in his favor, and strictly as against the creditor, In Re Decker, 595 F.2d 185 (3d Cir.1979), we conclude that the record of the instant case establishes that this debt should not be discharged.
NOTES
[1] This opinion constitutes the findings of fact and conclusions of law required by Bankruptcy Rule 7052 (effective August 1, 1983).
[2] The figure includes $231.64 in finance charges through January, 1984.
[3] Sixty-one charges were made in all, with two items being returned and credited. Of the fifty-nine purchases: one for $35.00 was made in April; two, totalling $227.95, were made in May; twelve, totalling $786.16, were made in June; twenty-two, totalling $1,054.86, were made in July; fourteen, totalling $537.86, were made in August; and eight, totalling $221.58, were made in September.
[4] To the contrary, the debtor testified that he first consulted an attorney in early November.
[5] The charges included those for: airline, hotel, restaurant and bar services; a sports publication subscription; clothing; and sporting goods. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552214/ | 41 B.R. 425 (1984)
In re COUNTRY JUNCTION, INC. et al., Debtor and Bankrupt.
COUNTRY JUNCTION, INC., et al., Plaintiffs-Appellees,
v.
LEVI STRAUSS & CO., et al., Defendants-Appellants.
Civ. A. No. A-83-CA-674.
United States District Court, W.D. Texas, Austin Division.
June 25, 1984.
*426 *427 David S. Gragg, Groce, Locke & Hebdon, Donald R. Taylor, Akin, Gump, Strauss, Hauer & Feld, San Antonio, Tex., Sheinfeld, Maley & Kay, Houston, Tex., Leo Fox, New York City, for plaintiffs-appellees.
Ted Cackowski, Austin, Tex., Kahn & Kahn, St. Louis, Mo., John M. Tutt, San Antonio, Tex., for defendants-appellants; McDuff & Damron, Austin, Tex., of counsel.
MEMORANDUM OPINION
JACK ROBERTS, Senior District Judge.
This case is before the Court on appeal from bankruptcy court. Having reviewed the record on appeal, the briefs of the parties, and the pleadings on file, the Court finds that the facts and legal arguments are adequately presented in the briefs and record and that its decision would not be significantly aided by oral argument. See Bankr.R. 8012. The Court affirms the decision of the Court below.
The appellant, Levi Strauss & Co., appeals from an order of the bankruptcy court granting the appellees recovery of a preference under section 547 of the Bankruptcy Code. The appellees Country Junction, Inc., and Country Legend, Inc., are corporate affiliates and filed for relief under Chapter 11 of the Bankruptcy Code on December 11, 1981. In April 1982, Junction and Legend filed an adversary action in bankruptcy court to recover payments made by them to Levi between September 16 and November 25, 1981. The bankruptcy court subsequently consolidated all causes of action that the affiliated corporate plaintiffs had against the defendants in the adversary action. After a trial, the bankruptcy court entered its opinion and order, awarding Junction and Legend $415,291.
Levi raises several issues in this appeal, challenging the decision of the bankruptcy court. First, Levi contends that the bankruptcy court lacked jurisdiction because the proceeding was a "related" civil proceeding under 28 U.S.C. § 1471(b) and (c) and under section 241(a) of the Bankruptcy Reform Act of 1978. Second, Levi argues that if this Court should determine that the bankruptcy court properly had jurisdiction, the case must be remanded to the bankruptcy court for additional findings of fact. Third, Levi contends that the bankruptcy court erred in striking its jury demand and requests a new trial, by jury, in district court. Fourth, Levi submits that the bankruptcy court erred in basing its decision in part on the consolidated financial data of Legend and Junction in the absence of substantive consolidation in the main proceeding.
Last, Levi challenges several findings of fact and conclusions of law made by the bankruptcy court. The specific issues concern the validity of the notes and guaranties executed by Legend and Junction to Levi, whether the two corporations were alter egos, the nature of certain funds of Junction, the extent of the secured debt of Junction, the insolvency of Junction and Legend, and the result had Legend been liquidated under Chapter 7.
PRELIMINARY ISSUES
Standard of Review. Bankruptcy Procedure Rule 8013 provides,
On an appeal the district court or bankruptcy appellate panel may affirm, modify, or reverse a bankruptcy court's judgment, order, or decree or remand with instructions for further proceedings. Findings of fact shall not be set aside unless clearly erroneous, and due regard *428 shall be given to the opportunity of the bankruptcy court to judge the credibility of the witnesses.
A district court must accept findings of fact made in a bankruptcy proceeding unless they are clearly erroneous. Wilson v. Huffman (In re Missionary Baptist Foundation of America), 712 F.2d 206 (5th Cir. 1983) (citing Northern Pipeline Construction Co. v. Marathon Pipe Line Co., 458 U.S. 50, 102 S. Ct. 2858, 73 L. Ed. 2d 598 (1982)). The burden of establishing a clearly erroneous determination is a stringent one; to be convinced, a reviewing court must have a definite and firm conviction that a mistake has been committed. In re Missionary Baptist, 712 F.2d at 209 (quoting United States v. United States Gypsum Co., 333 U.S. 364, 395, 68 S. Ct. 525, 542, 92 L. Ed. 746 (1948)). "The test for the district court . . . is not whether a different conclusion from the evidence would be appropriate, but whether there is sufficient evidence in the record to prevent clear error in the trial judge's findings." Highland Village Bank v. Bardwell (In re Bardwell), 610 F.2d 228, 230 (5th Cir.1980).
The rigorous standard applied to findings of fact does not, however, constrain appellate review of the bankruptcy court's conclusions of law, which are subject to plenary review. In re Missionary Baptist, 712 F.2d at 209. Moreover, "[w]hen a finding of fact is premised on an improper legal standard, or a proper one improperly applied, that finding loses the insulation of the clearly erroneous rule." Id. Thus, the district court "must independently determine the correctness of the ultimate legal conclusion adopted by the bankruptcy judge on the basis of the facts found." Borg-Warner Acceptance Corp. v. Fedders Financial Corp. (In re Hammons), 614 F.2d 399, 403 (5th Cir.1980).
Levi argues that the foregoing standard of review does not apply to this case because it was tried by the bankruptcy court during the period from December 25, 1982, to July 31, 1983, when this Court's Emergency Rule was in effect. The Emergency Rule provided, in paragraph (e)(2)(B), that "[i]n conducting review, the district judge . . . need give no deference to the findings of the bankruptcy judge."
After reviewing the relevant statutory and case law, however, the Court concludes that the standard of review in this case is governed by the new Bankruptcy Rules, which were prescribed by the Supreme Court pursuant to 28 U.S.C. § 2075. The Supreme Court order prescribing the Rules stated that they "shall take effect on August 1, 1983, and shall be applicable to proceedings then pending. . . ." 11 U.S.C.A. Bankr.Rules & Official Forms Rules 1 to 7000 at xiii (West 1984). Furthermore, the Supreme Court Bankruptcy Rules prevail over any conflicting local rules adopted by a district court, including the Emergency Rule in question here. Frank v. Arnold (In re Morrissey), 717 F.2d 100, 104 (3d Cir.1983).
The bankruptcy court order that Levi is appealing was entered on August 8, 1983. Levi's notice of appeal was timely filed pursuant to Rule 8002 on October 13, 1983. Even though this case was pending before the bankruptcy court before August 1, 1983, and was governed by the Emergency Rule at that time, the new Bankruptcy Rules have been in effect for the entire time this case has pended before this Court. Accordingly, the new Bankruptcy Rules govern the practice and procedure in this case on appeal. See Philadelphia Consumer Discount Co. v. Commercial Credit Business Loans, Inc. (In re Philadelphia Consumer Discount Co., 37 B.R. 946 (D.C.E.D.Pa.1984); Davis v. Lewis, 36 B.R. 88 (D.C.E.D.Ark.1984); Commodity Credit Corp. v. Tarnow (In re Tarnow), 35 B.R. 1014 (D.C.N.D.Ind.1983).
Jurisdiction of the Bankruptcy Court. Levi has challenged the jurisdiction of the bankruptcy court in this action. Junction and Legend jointly filed a complaint against Levi, seeking recovery of transfers on the grounds that the transfers were voidable preferences under section 547 of the Bankruptcy Code. Levi argues first that the attempt to recover a preference, as opposed to merely avoiding a preference, *429 took this action beyond the summary jurisdiction of the bankruptcy court. Second, Levi notes that since it had not filed a claim against Legend, Legend's action against it constituted a "related proceeding" in which the bankruptcy court did not have jurisdiction to enter final orders. Emergency Rule ¶ (d)(3)(B).[1] Levi therefore asserts a right to a jury trial in district court.
As to Levi's first contention, the Court holds that the bankruptcy court properly had plenary jurisdiction to hear this case. While the former Bankruptcy Act expressly provided that plenary actions to recover preferences could not be brought before the bankruptcy court without the consent of the transferee, there is no similar provision in the Bankruptcy Code. See Bankruptcy Act of 1898, ch. 541, § 60(b), 30 Stat. 562, repealed by Pub.L. No. 95-598, Title IV, § 401(a), 92 Stat. 2549. Therefore, while Levi may be correct in arguing that under the Bankruptcy Act a party who had not presented a claim in a bankruptcy proceeding had a right to a plenary proceeding in federal or state court, see Katchen v. Landy, 382 U.S. 323, 336, 86 S. Ct. 467, 476, 15 L. Ed. 2d 391 (1966), its argument is irrelevant to this action, which is governed by the Bankruptcy Code.
As to Levi's second contention, the Emergency Rule defined a related proceeding as "those civil proceedings that, in the absence of a petition in bankruptcy, could have been brought in a district court or a state court." Emergency Rule ¶ (d)(3)(A). An action to recover a preference arises solely under the federal bankruptcy laws and cannot be brought in the absence of a petition in bankruptcy. Such actions therefore do not come within the definition of a related proceeding as set forth in the Emergency Rule. More important, it therefore also does not violate the rule of the Marathon case, 458 U.S. 50, 102 S. Ct. 2858, 73 L. Ed. 2d 598, to hold that such an action is within the jurisdiction of the bankruptcy court. See Salomon v. Kaiser (In re Kaiser), 722 F.2d 1574, 1581-82 (2d Cir. 1983).[2]
Levi argues further, however, that it had a right to a jury trial in this action and that it timely demanded a jury trial. If Levi is correct, the bankruptcy court did not have proper jurisdiction to hear this case, because the Emergency Rule expressly prohibited bankruptcy judges from conducting jury trials. Emergency Rule ¶ (d)(1)(D).
Levi does not state whether its asserted right to a jury arises from the seventh amendment or from statute. In regard to a Constitutional right to a jury trial, the Supreme Court noted in Katchen, 382 U.S. at 336-37, 86 S. Ct. at 476, "as the proceedings of bankruptcy courts are inherently proceedings in equity, . . . there is no Seventh Amendment right to a jury trial for determination of objections to claims. . . ." The fact that a money judgment is entered in a case does not change the nature of the case from an action in equity to an action in law within the ambit of the seventh amendment.[3]Pereira v. Checkmate Communications Co., Inc. (In re *430 Checkmate Stereo & Electronics, Ltd.), 21 B.R. 402, 408 (D.C.E.D.N.Y.1982).
The statutory right to a trial by jury under the Bankruptcy Code is governed by 28 U.S.C. § 1480(a). That section provides in effect that where a right to a jury trial existed under the old Bankruptcy Act, that right remains undiminished under the new Bankruptcy Code. Thus, it is necessary to determine what rights to a jury existed under the Bankruptcy Act in a case such as this one.
Under the Bankruptcy Act, the right to a jury trial depended primarily on the distinction between the plenary and summary jurisdiction of the bankruptcy court. 1 Collier on Bankruptcy ¶ 3.01(4)(a) (L. King 15th ed. 1979). Parties to summary proceedings had a right to a jury trial only in specified circumstances.[4]
The Court concludes that Levi does not have a right to trial by jury in this case and bases its conclusion on two separate lines of reasoning. First, the Court recognizes that had the trustee for Junction filed this action under the Bankruptcy Act, the summary jurisdiction of the bankruptcy court would have been unavailable because Levi had not filed a claim against Junction. The trustee therefore would have had to bring the action as a plenary proceeding, with the potential for the right to trial by jury. However, as noted above, the Bankruptcy Code does not provide a right to a plenary proceeding in such a case; rather, these cases are now to be adjudicated as a summary proceeding namely, one involving a controversy over property in the constructive possession of the bankruptcy court. Since there was no right to a jury trial in a summary proceeding under the old Bankruptcy Act, there is now no right to one under the new Bankruptcy Code.
Second, the Court notes that even if Levi were still entitled to a plenary proceeding to resolve this dispute, the trustee's action to avoid and recover a preference is an action in equity, not law. "It is not an action seeking damages for an act complained of, but rather, seeks the return of the res for a more equitable distribution." Boroff v. Carriero (In re Carriero), 21 B.R. 132, 134 (Bkrtcy.D.Mass.1982). Therefore, under the Bankruptcy Act, Levi would not have been entitled to a trial by jury. Again, it follows that under 28 U.S.C. § 1480(a), Levi is not entitled to a trial by jury in this action under the Bankruptcy Code.[5] The Court therefore concludes that the bankruptcy court properly had jurisdiction over the entire action.
Joinder and Consolidation of Claims. Levi challenged the bankruptcy court's joinder of the claims of Junction and Legend. Initially, the trustee for Junction and Legend filed a single claim for relief on behalf of both corporations. Subsequently, the bankruptcy court granted the plaintiffs' motion to consolidate all claims that either of them had against Levi.
Bankruptcy Rule 7020 provides, through Federal Civil Procedure Rule 20, that plaintiffs may join in one action whether they assert their right to relief jointly, severally, or in the alternative. The joinder of parties is proper if there are both common questions of law or fact and the rights asserted arise out of the same transaction or series of transactions. Moreover, under the Federal Rules of Civil Procedure, "`joinder of claims, parties and remedies is strongly encouraged."' Russo v. Bache Halsey Stuart Shields, Inc., 554 F. Supp. 613, 616 (N.D.Ill.1982) (quoting United Mine Workers of America v. Gibbs, 383 U.S. 715, 724, 86 S. Ct. 1130, 1137, 16 L. Ed. 2d 218 (1966)). The claims of Junction and Legend arise out of the same series of transactions and involve common questions of law and fact, and joinder was therefore proper under Rule 7020.
*431 The subsequent "consolidation" of the claims of the plaintiffs was proper under Federal Civil Procedure Rule 17 and Bankruptcy Rule 7017. Levi's objection that the plaintiff corporations are separate entities misses the point: "An identity of parties is not required; a substantial identity of issues is." Delta Coal Program v. Libman, 554 F. Supp. 684, 690-91 (N.D.Ga.1982). The claims of Junction and Legend involve a substantial identity of issues and the consolidation of their claims was proper.
Sufficiency of Findings of Fact and Conclusions of Law. Levi contends that the findings of fact and conclusions of law made by the bankruptcy court did not meet the requirements of Bankruptcy Rule 7052, which makes Federal Civil Procedure Rule 52 applicable to bankruptcy proceedings. As the Fifth Circuit has stated, "The purpose of F.R.Civ.P. 52 is to afford the appellate court a clear understanding of the basis of the trial court's decision." Ruiz v. Estelle, 679 F.2d 1115, 1133 n. 49 (5th Cir.), modified on rehearing, 688 F.2d 266 (5th Cir.1982), cert. denied, 460 U.S. 1042, 103 S. Ct. 1438, 75 L. Ed. 2d 795 (1983).
The bankruptcy court separately listed its findings of fact and conclusions of law and set forth a clear statement of the basis of its decision. That statement is sufficient to give this Court a "clear understanding of the analytical process by which ultimate findings were reached and to assure [it] that the trial court took care in ascertaining the facts." Id. at 1133.
AVOIDING A PREFERENCE
Section 547(b) Requirements. Levi's central challenge to the bankruptcy court's order is that the court erred in holding that the payments in question constituted a preference under section 547 of the Bankruptcy Code. Under section 547(b), a trustee may avoid as a preference any transfer of a debtor's property to a creditor that is for an antecedent debt, made while the debtor was insolvent, and made within 90 days of the filing a petition for bankruptcy, and that enables the creditor to receive more than it would have received under a chapter 7 liquidation and distribution. Levi contends, among other things, that (1) the funds it received had been part of Legend's estate, not Junction's, (2) Legend was not insolvent at the time of the transfers, and (3) there is no evidence to determine what the distribution under chapter 7 would have been.
To resolve these issues, this Court must determine whether the bankruptcy court's findings of fact sufficiently support its conclusion that the requirements for avoiding a preference were met in this case. The bankruptcy court found that Junction and Legend had executed, as comakers, two notes to Levi. The notes were executed in connection with an agreement between the parties to carry forward the outstanding balances of Junction and Legend. The first note was executed on June 19, 1981, in the amount of $1,000,000. On September 14, 1981, the second note was executed in the amount of $221,761.52 upon the resolution of a dispute over the remainder of the amount owed as of June 19, 1981. In the 90-day period preceding the filing of the chapter 11 petition, six payments totalling $415,291.74 were made on the two notes. All payments were made from accounts held in Junction's name and under its exclusive control. Finally, the bankruptcy court found that during this period, Junction was insolvent.
The evidence supported the foregoing findings, and the bankruptcy court properly concluded that the notes made Levi a creditor of Junction's and that the payments were made for an antecedent debt.[6]See Tex.Bus. & Com.Code Ann. § 3.118(5) (Vernon 1968); Caldwell v. Stevenson, 567 S.W.2d 278 (Tex.Civ.App.Austin 1978, no writ). Levi, however, contends that Junction held the money in constructive trust for Legend and that therefore Junction did not have the requisite property interest in the money it paid to Levi. Levi thus concludes that the initial requirement that there be a "transfer of property of the *432 debtor" was not met. See I-T-E Circuit Breaker Co. v. Holzman, 354 F.2d 102 (9th Cir.1965); 4 Collier on Bankruptcy ¶ 547.08(2).
Requisites of a Constructive Trust. "A constructive trust is an equitable remedy created by the courts to prevent unjust enrichment." Hudspeth v. Stoker, 644 S.W.2d 92, 93 (Tex.App.San Antonio 1982, no writ). An express agreement is not necessary to create a constructive trust. Omohundro v. Matthews, 161 Tex. 367, 341 S.W.2d 401, 405 (1960). "It is imposed by law because the person holding the title to property would profit by wrong or would be unjustly enriched if he were permitted to keep the property." Id.
In order to justify imposing a constructive trust on property, fraud, either actual or constructive, must be present. Talley v. Howsley, 142 Tex. 81, 176 S.W.2d 158 (1943). Actual fraud usually involves a dishonest purpose or an intent to deceive, while constructive fraud usually involves a breach of trust or confidential relationship. Archer v. Griffith, 390 S.W.2d 735, 740 (Tex.1964). Confidential relationships arise not only from technical fiduciary relationships, but also from partnerships, joint ventures, and other informal relationships. Thigpen v. Locke, 363 S.W.2d 247, 253 (Tex.1962); see also Harris v. Sentry Title Co., Inc., 715 F.2d 941 (5th Cir.1983), petition for cert. filed sub nom. Ward v. Sentry Title Co., Inc., ___ U.S. ___, 104 S. Ct. 2679, 81 L. Ed. 2d 874 (1984).
A second requirement of the remedy is that the beneficiary of the trust "must trace the equitable right asserted in an unbroken line to the property he seeks to impress with the trust." Peirce v. Sheldon Petroleum Co., 589 S.W.2d 849, 853 (Tex.Civ.App.Amarillo 1979, no writ). But even when tracing to specific trust funds is impossible because the trustee has commingled the trust funds with other funds, the right is not necessarily defeated if the beneficiary can trace to the commingled fund. Logan v. Logan, 138 Tex. 40, 156 S.W.2d 507 (1941). If the commingling of the funds was wrongful, the burden is on the trustee to distinguish his funds from the trust funds; however, if there was no wrongful commingling, the trust beneficiary must establish the nature and extent of the beneficial interest in the commingled fund. Id. at 510-11.
In this case, sales proceeds from Junction stores and Legend stores were forwarded, pursuant to a financing agreement, directly to ITT Commercial Credit, which would then remit the funds to operating accounts held in Junction's name.[7] Although the funds from the stores were indiscriminately commingled in the accounts, intercompany accounts were maintained to keep track of the ownership of the funds. Levi has not contended that the commingling of funds in this case was wrongful, and under Texas law it has the burden of establishing the extent of its beneficial interest in the Junction accounts.
After examining the record, the Court concludes that the bankruptcy court correctly held that the funds used to make the preference payments were the property of Junction. First, Levi presented evidence based on an accountant's analysis of the intercompany accounts. On cross-examination, Levi's expert witness testified that during the entire 90-day period preceding the filing, the intercompany account showed a net amount due from Legend to Junction. Thus it appears that even if Legend could trace its beneficial interest in the funds held by Junction, it was a net debtor to Junction, not a net creditor, during the relevant period. There were thus no net funds in the accounts to which a constructive trust could be applied.
Second, regardless of the net balance recorded in the intercompany account, Levi did not demonstrate that the essential element of fraudactual or constructive was present in Junction's management of the intercompany account or in the payments *433 it made to Levi. And even if Levi could have shown that the payments were improperly recorded against the "Junction" note instead of the "Legend" note, that would not be sufficient to establish a constructive trust over the money paid out of the account. At best, an improper credit on the companies' books would only establish a claim by Legend against Junction. But even more important, since the two companies were comakers on the notes and therefore jointly and severally liable on each note, any payment that Junction made on either note reduced the liabilities of Legend as well as its own. Thus, Levi can hardly contend that Junction's payments to Levi were in themselves detrimental to Legend. As a result, there was no constructive trust created for Legend's benefit.
The Court therefore concludes that the money in the accounts was the property of Junction. It only remains to determine whether the bankruptcy court properly held that the payments to Levi enabled it to receive more than it would have received in a chapter 7 liquidation.
Distribution Under a Chapter 7 Liquidation. The bankruptcy court found that had this been an insolvency case under chapter 7, Levi would have received nothing because of the large amount of secured debt that would have depleted the money available after paying priority claims. Junction presented evidence of the amount of money that would have been available for distribution to all the creditors. According to the testimony, no money would have been available to unsecured creditors such as Levi. It was therefore not clearly erroneous for the bankruptcy court to hold that the payments to Levi enabled it to receive more than it would have received in a chapter 7 liquidation.[8]
Summary. All elements of section 547(b) having been established, the bankruptcy court properly held that the transfers constituted avoidable preferences. Levi's other arguments, concerning improper consolidation of the companies, treatment of them as alter egos, and the insolvency of Legend are thus rendered moot. Accordingly,
The decision of the bankruptcy court is AFFIRMED.
NOTES
[1] Levi concedes that it submitted itself to the summary jurisdiction of the bankruptcy court in the Legend case because it had filed a proof of claim against Legend. But it argues that its filing that claim did not subject it to the jurisdiction of the court in the Junction action and that in any event, the attempt by Junction and Legend to recover a preference invokes the plenary jurisdiction of the bankruptcy court.
[2] The Court notes also that the Emergency Rule expressly stated that related proceedings did not include "orders to turn over property of the estate [and] proceedings to set aside preferences. . . ." Emergency Rule ¶ (d)(3)(A). Section 550 of the Bankruptcy Code authorizes the trustee to recover any property to the extent that a transfer is avoided. Section 551 provides that any transfer avoided under section 547 is preserved for the benefit of the estate. Since section 541 provides that the estate includes any interest in property, wherever located, that is recovered under section 550 or preserved under section 551, orders to recover an avoidance are equivalent to "orders to turn over property of the estate." Thus, the order of the bankruptcy court in this action was one of the orders listed in the Emergency Rule as not constituting a related proceeding.
[3] By its terms, the seventh amendment right to a jury trial applies only to "Suits at common law."
[4] The right to trial by jury in summary proceedings was preserved only in dischargeability of debt proceedings under 11 U.S.C. § 35(c) and in disputed involuntary petitions under 11 U.S.C. § 42. 1 Collier on Bankruptcy ¶ 3.01(4)(a) at 3-84.6, 3-88 (L. King 15th ed. 1979).
[5] Since the Court holds that Levi did not have a right to a jury trial, it is unnecessary to determine whether Levi timely presented its demand for a jury under Federal Civil Procedure Rule 38.
[6] Levi contends that the notes are invalid. But since the notes were executed mainly to evidence the companies' liability on their accounts payable, Levi is a creditor to Junction and Legend, regardless of the validity of the notes.
[7] The two corporations had common management personnel and shared headquarters and warehouse facilities in Austin, Texas. Legend's bank accounts and purchase accounts were closed when it was acquired by Junction. Junction ordered all merchandise for its own stores and Legend's and paid for it out of its bank accounts.
[8] Levi contends that ITT had not properly perfected its claim and therefore should not be considered a secured creditor. The testimony demonstrated that unsecured creditors would have received nothing even if ITT was not considered a secured creditor. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/503531/ | 842 F.2d 1179
Sidney Allen WORTHEN, Petitioner-Appellant,v.Larry R. MEACHUM, Director; Attorney General of the Stateof Oklahoma, Respondents-Appellees.
No. 86-1844.
United States Court of Appeals,Tenth Circuit.
March 21, 1988.
Michael Gassaway of Hughes & Nelson, Oklahoma City, Okl., for petitioner-appellant.
Before McKAY and SEYMOUR, Circuit Judges, and SAM,* District Judge.
SEYMOUR, Circuit Judge.
1
Sidney Allen Worthen brought this petition for a writ of habeas corpus pursuant to 28 U.S.C. Sec. 2254 (1982), alleging, inter alia, that his guilty plea in an Oklahoma state court to first-degree murder was involuntary. The federal district court held that Worthen could not challenge his guilty plea because he had not shown cause and prejudice after his failure to raise the issue properly in state court.1 On appeal Worthen renews his contentions that his plea was involuntary, and that habeas relief is not barred by his procedural default. We affirm.2
I. PROCEDURAL DEFAULT
2
Under Oklahoma law, a defendant may not appeal from a conviction on a guilty plea if he does not apply to withdraw the plea within ten days of the judgment and sentence. See Okla.Stat. tit. 22, Sec. 1051 (1981); Okla.R.Crim.App. 4.1. The transcript of the plea proceeding in this case reveals that Worthen, who was represented by retained counsel, was told that he had the right to ask the court to withdraw his guilty plea within ten days. He responded that he understood. He also stated that he wanted to waive the waiting period, and be sentenced and transported to prison immediately. He did not apply to withdraw his plea within ten days and did not attempt to pursue a timely direct appeal.3
3
In May 1985, Worthen filed an application for state post-conviction relief, asserting, in addition to numerous other claims, that his guilty plea was involuntary. Under Oklahoma law, post-conviction relief is not available to a defendant who has not perfected a timely direct appeal unless he articulates special circumstances showing "sufficient reason" for his failure. Okla.Stat. tit. 22, Sec. 1086 (1981); see also Maines v. State, 597 P.2d 774, 776 (Okla.Crim.App.1979). The state courts here held that Worthen had failed to make the required showing and refused to consider the voluntariness of his plea on the merits. After reviewing the above procedural history, the federal district court held that Worthen could not obtain federal habeas review of his guilty plea unless he satisfied the cause and prejudice requirement set out in Wainwright v. Sykes, 433 U.S. 72, 97 S.Ct. 2497, 53 L.Ed.2d 594 (1977). In so doing, the court used the wrong legal standard.
4
In Fay v. Noia, 372 U.S. 391, 83 S.Ct. 822, 9 L.Ed.2d 837 (1963), the Supreme Court held that a defendant who had not taken a direct appeal of his state conviction was barred from obtaining federal review only if his decision was a deliberate by-pass of orderly state procedure. Although subsequent Supreme Court cases have held that the more demanding Wainwright cause and prejudice standard applies when a defendant perfects a state appeal but does not raise the issue he later asserts in federal court, see Murray v. Carrier, 477 U.S. 478, 106 S.Ct. 2639, 2648, 91 L.Ed.2d 397 (1986); Reed v. Ross, 468 U.S. 1, 11, 104 S.Ct. 2901, 2907, 82 L.Ed.2d 1 (1984), the appropriate test to apply when a petitioner has taken no direct state appeal remains the deliberate bypass inquiry of Fay, Holcomb v. Murphy, 701 F.2d 1307, 1310 (10th Cir.) ("[The Supreme Court] has not overruled Fay, and until it does we shall apply the rule of that case at least to situations in which no state appeal has been taken."), cert. denied, 463 U.S. 1211, 103 S.Ct. 3546, 77 L.Ed.2d 1394 (1983). See Murray, 106 S.Ct. at 2648 (expressing no opinion when defendant fails to appeal); Wainwright, 433 U.S. at 88 n. 12, 97 S.Ct. at 2507 n. 12 (same).
5
Although the district court assessed Worthen's procedural default under inappropriate criteria, a remand is not necessary under the circumstances of this case. In evaluating Worthen's showing of cause and prejudice, the court concluded that even if Worthen had established sufficient cause for his failure to appeal, he had not demonstrated actual prejudice because he had not shown that his guilty plea had been given involuntarily. Thus, even if Worthen were, to prevail after the district court redetermined the availability of federal habeas relief under the less stringent standard of Fay, Worthen would receive on remand no more than the review the district court has already provided--an evaluation of the constitutional validity of his guilty plea. We will therefore consider whether the district court's ruling on this issue was correct.
II. THE GUILTY PLEA
6
Worthen and a co-defendant were charged with first-degree murder in the death of Worthen's wife, who was found in her home with her throat slit. At the preliminary hearing, the State relied on a signed statement that Worthen had given to investigating authorities. Worthen admitted in the statement that he and a cohort had planned the murder to obtain the insurance proceeds under a life insurance policy Worthen had recently obtained on his wife. He said that his cohort actually did the killing.
7
Pursuant to Oklahoma law, the State indicated its intent to seek the death penalty for Worthen by filing a Bill of Particulars setting out the evidence of aggravating circumstances upon which it would rely. See Okla.Stat. tit. 21, Sec. 701.10 (1981); Ross v. State, 717 P.2d 117, 122-23 (Okla.Crim.App.1986). The record of the guilty plea proceedings reveals that Worthen agreed to plead guilty to first degree murder upon the advice of his attorney in exchange for the State's agreement to withdraw the Bill of Particulars. The plea bargain thus eliminated the possibility that Worthen could be sentenced to death. Instead, he was sentenced to life in prison.
8
On appeal, Worthen asserts that his plea was involuntary, and therefore constitutionally invalid, because: 1) he was not advised at the plea proceeding of the range of punishment for the offense; 2) he was likewise not advised of the acts sufficient to constitute the offense for which he was charged; and 3) he entered the plea in reliance upon misrepresentations made by his attorney. He does not challenge the district court's failure to hold an evidentiary hearing, nor does he assert that further factual development is necessary to resolve the issues he pursues on appeal.
A.
9
A plea is not voluntary unless the defendant knows the direct consequences of his decision, including the maximum penalty to which he will be exposed. See, e.g., Quiroz v. Wawrzaszek, 749 F.2d 1375, 1378 (9th Cir.1984), cert. denied, 471 U.S. 1055, 105 S.Ct. 2119, 85 L.Ed.2d 483 (1985); Rouse v. Foster, 672 F.2d 649, 651 (8th Cir.1982); Cheely v. United States, 535 F.2d 934, 935 (5th Cir.1976). While Worthen is correct in asserting that he was not informed of the maximum sentence on the record of the plea colloquy, we do not agree that a silent record is always dispositive. The critical inquiry is whether Worthen actually knew of the maximum possible sentence. See, e.g., Nelson v. Callahan, 721 F.2d 397, 400 (1st Cir.1983); Rouse, 672 F.2d at 651; Hunter v. Fogg, 616 F.2d 55, 58 (2d Cir.1980). But see Yellowwolf v. Morris, 536 F.2d 813 (9th Cir.1976) (requiring that trial judge advise the defendant on the record of the maximum penalty).
10
Under Oklahoma law at the time Worthen pled guilty to first-degree murder, he could have received only two possible sentences, death or life in prison. See, Okla.Stat. tit. 21, Sec. 701.9, subd. A (1981). The record reflects that Worthen agreed to plead only after extensive discussion with his attorney, an experienced criminal lawyer. See Berry v. Mintzes, 726 F.2d 1142, 1149 (6th Cir.), cert. denied, 467 U.S. 1245, 104 S.Ct. 3520, 82 L.Ed.2d 828 (1984). Moreover, Worthen expressed no surprise or objection when the court imposed a life sentence. See id.; Johnson v. Fogg, 653 F.2d 750, 753 (2d Cir.1981). Worthen has never alleged he did not know that life imprisonment was the only sentence he could receive after the State agreed not to seek the death penalty. Under these circumstances, we cannot hold his plea unknowing or involuntary simply because the court did not, as it should have, specifically inform him at his plea hearing of the maximum sentence.
B.
11
Worthen contends that his plea was not knowing and voluntary because he was not advised on the record of the acts sufficient to constitute the offense. He does not allege what he did not understand about the charge against him. We assume he is contending that the record lacks an explanation of the nature or elements of the crime. See Henderson v. Morgan, 426 U.S. 637, 96 S.Ct. 2253, 49 L.Ed.2d 108 (1976).
12
Worthen was at the preliminary hearing where the details of the murder were described by the investigating officer. The transcript of the plea colloquy reveals that Worthen's attorney stated on the record, after referring to the information filed against Worthen, that Worthen was charged with effecting the death of his wife to recover insurance proceeds. Thereupon, in response to a question from the judge, Worthen affirmed that he was pleading guilty because he was guilty of the offense as described.
13
"It is well established that a plea of guilty cannot be voluntary in the sense that it constitutes an intelligent admission that the accused committed the offense unless the accused has received 'real notice of the true nature of the charge against him, the first and most universally recognized requirement of due process.' "
14
Marshall v. Lonberger, 459 U.S. 422, 436, 103 S.Ct. 843, 852, 74 L.Ed.2d 646 (1983) (citations omitted); Henderson, 426 U.S. at 645 & n. 13, 96 S.Ct. at 2257 & n. 13 (1976)). Thus, in order for a guilty plea to be "voluntary in a constitutional sense," a defendant must not merely understand the rights he waives, but he must also have a competent understanding of the charge against him. Id. The Supreme Court has clearly indicated, however, that a defendant of sufficient "intelligence and experience in the criminal justice system" may, in some circumstances, be presumed to have understood the nature of the charge even though a specific explanation is not shown on the plea record. See Marshall, 459 U.S. at 436-37, 103 S.Ct. at 851-52; Henderson, 426 U.S. at 647, 96 S.Ct. at 2258.
15
Courts have made this presumption when a defendant of normal intelligence is read an information that is clear and not complex, see United States v. Dayton, 604 F.2d 931, 938 (5th Cir.1979), cert. denied, 445 U.S. 904, 100 S.Ct. 1080, 63 L.Ed.2d 320 (1980); when the defendant has discussed the plea with an experienced criminal lawyer, see Berry, 726 F.2d at 1147, and when the defendant has offered no evidence to rebut the presumption that his attorney has explained the nature of the offense to him, see Gregory v. Solem, 774 F.2d 309, 316 (8th Cir.1985), cert. denied, 475 U.S. 1088, 106 S.Ct. 1475, 89 L.Ed.2d 730 (1986). Those factors are all present here. Worthen even answered affirmatively when asked at his plea hearing if he had been charged with first degree murder. Moreover, Worthen never alleges what element of this crime he did not understand. Cf. Henderson, 426 U.S. at 647, 96 S.Ct. at 2258 (trial judge found element of intent not explained to respondent who pled guilty to second degree murder). Accordingly, we presume that Worthen received actual notice of the nature of the charge to which he pled sufficient to allow him to form an intelligent decision to plead guilty.
C.
16
Worthen also argues that his plea was involuntary because it was given in reliance on misrepresentations made to him by his attorney. Specifically, Worthen claims he relied on representations that he would be paroled in five or six years, that he would be given immunity from prosecution on other charges, and that his attorney would represent him in other legal and financial matters.
17
Worthen repeatedly stated on the record that he had not been coerced, threatened, or promised anything by his attorney or anyone else. Although such record responses are subject to challenge under appropriate circumstances, they "constitute a formidable barrier in any subsequent collateral proceedings." Blackledge v. Allison, 431 U.S. 63, 74, 97 S.Ct. 1621, 1629, 52 L.Ed.2d 136 (1977); Little v. Allsbrook, 731 F.2d 238, 239 n. 2 (4th Cir.1984); Johnson, 653 F.2d at 752. In Blackledge, the petitioner alleged that his attorney told him the prosecution and the court had promised if he pled guilty he would receive a ten year sentence. Id. 431 U.S. at 69, 97 S.Ct. at 1626. He pled and was sentenced to seventeen to twenty-one years. In holding that summary dismissal was inappropriate, the court looked closely at both the petitioner's allegations and the circumstances in which he pled guilty. See id. at 76, 97 S.Ct. at 1630. When we examine the present case under the standards utilized in Blackledge, we conclude that the broken promises Worthen alleges are insufficient to undermine the voluntariness of his plea.
18
A defendant's expectation of parole that is based on a bad guess by his attorney does not render a plea involuntary. See Hill v. Lockhart, 474 U.S. 52, 106 S.Ct. 366, 369, 88 L.Ed.2d 203 (1985); Little v. Allsbrook, 731 F.2d at 241; cf. Wellnitz v. Page, 420 F.2d 935, 936-37 (10th Cir.1970) (same for inaccurate prediction of sentence). When an involuntariness claim rests on the faulty legal decisions or predictions of defense counsel, the plea will be deemed constitutionally involuntary only when the attorney is held to have been constitutionally ineffective. Hill, 106 S.Ct. at 369. Here, Worthen was told on the record that neither his attorney nor the court had any authority over the Pardon and Parole Board. He does not suggest any reason why he would have chosen to face the death penalty had his attorney correctly informed him of his parole eligibility; nor does he allege that he would have withheld his guilty plea had he known the true parole possibilities. Cf. Hill, 106 S.Ct. at 371. Under these circumstances, even if Worthen's attorney's alleged mistaken advice about parole rendered his performance inferior to that reasonably expected of attorneys in these circumstances, Worthen was not prejudiced by advice that the court specifically told him was incorrect.
19
The alleged promise of immunity presents an additional consideration. When a plea rests on a promise of the prosecutor, that promise must be fulfilled regardless of the role it played in the defendant's decision to plead. Santobello v. New York, 404 U.S. 257, 262, 92 S.Ct. 495, 498, 30 L.Ed.2d 427 (1971). Although Worthen speaks in terms of promises made by his attorney, we assume he means that his attorney was merely relaying this alleged promise from the prosecutor. If such a promise had been made and broken, the interests of justice would demand that Worthen be entitled to some relief (e.g., either specific performance of the promise or an opportunity to withdraw his plea). Id. Worthen, however, has not alleged that he has been subjected to additional prosecution. Nor has he presented any other evidence suggesting that he is likely to be subject to future prosecution. In the absence of an allegation that the alleged promise has been broken, Worthen is not entitled to relief.
20
Worthen also alleges that his attorney promised him representation in various civil and financial matters. However, the plea transcript reveals the following exchange between the prosecutor and Worthen:
21
"Q. Other than the agreement by the State to dismiss the Bill of Particulars in this case, have any other promises been made to you, to get you to plead guilty?
22
"A. No, ma'am."
23
Tr. August 30, 1982, at 5. Subsequently, Worthen's attorney questioned him. After stating that his decision to plead guilty was influenced by the State's agreement to withdraw its request for the death penalty, Worthen testified as follows:
24
"Q. And that this is a free and voluntary plea on your part?
25
"A. Yes, it is.
26
"Q. And that it is not the result of any threat or coercion or any type of argument from me, to try to convince you to do this?
27
"A. That's true."
28
Id. at 9-10. The Court in Blackledge held that"Solemn declarations in open court carry a strong presumption of verity. The subsequent presentation of conclusory allegations unsupported by specifics is subject to summary dismissal, as are contentions that in the face of the record are wholly incredible."
29
431 U.S. at 74, 97 S.Ct. at 1629.
30
The promise of legal help allegedly made by Worthen's defense attorney was totally distinct from and unrelated to the material substance of the plea bargain. It is not the type of promise suggestive of coercion that would render a guilty plea involuntary. Significantly, Worthen does not allege that his attorney's promise to represent him in other matters in any way overbore his will or otherwise coerced him into pleading guilty. See generally Brady v. United States, 397 U.S. 742, 90 S.Ct. 1463, 25 L.Ed.2d 747 (1970). Moreover, unlike the plea hearing in Blackledge, which was exceedingly perfunctory, cf. 431 U.S. at 76-79, 97 S.Ct. at 1630-32, the hearing here involved considerable questioning of Worthen as to the voluntariness of his plea. Given all of these circumstances, we do not believe that Worthen has overcome the formidable barrier of his own statements on the record that his guilty plea was truly voluntary. We thus find no reason to look beyond the record of Worthen's plea hearing.
31
AFFIRMED.
APPENDIX
32
The thirty-eight grounds for relief asserted in both the state post-conviction application and the instant habeas petition fall into two groups. The first is comprised of the following grounds, which have been argued at length by the parties and were directly addressed by the district court:
33
1. Involuntary plea.
34
2. Ineffective assistance of counsel.
35
3. Prosecution's withholding of exculpatory evidence and the trial court's denial of due process in failing to grant petitioner's motions for discovery and continuance.
36
4. Illegal arrest and interrogation.
37
We address claims 1. and 2. in this opinion.
38
The second group consists simply of a list of conclusory claims that, to the extent they are not already incorporated in the four grounds cited above, have not been adequately developed by factual allegation or legal argument:
39
5. The possibility that the statute and/or the information were unconstitutional or incomplete.
40
6. The failure to give petitioner his Miranda warning before he was arrested.
41
7. Improper waiver of rights at all stages of the proceedings or arrest.
42
8. Improper use of evidence taken involuntarily.
43
9. Denial of the right to a speedy trial by postponing the preliminary hearing four times.
44
10. Adverse prejudicial pretrial publicity.
45
11. Denial of the right to counsel by counsel's total disinterest in this case.
46
12. Ineffective assistance of counsel.
47
13. Denial of the right to be present at all stages of the proceedings.
48
14. Prosecution's use of false testimony.
49
15. State's withholding of favorable evidence.
50
16. Court's failure to inform defendant properly during sentencing.
51
17. Petitioner was persuaded to plead guilty by promises which have not been kept.
52
18. Petitioner was persuaded to plead guilty by threats of death and other charges pending.
53
19. Petitioner did not enter guilty plea knowingly and voluntarily.
54
20. Court's failure to fix degree of the offense.
55
21. Defense counsel's failure to inform defendant of any procedures to follow in appeal or any other stage of the proceedings correctly.
56
22. The existence of newly discovered evidence in this case.
57
23. District attorney's untimely and prejudicial filing of Bill of Particulars.
58
24. Defense counsel's untimely and prejudicial manner of filing motions.
59
25. Use of hearsay testimony of Det. Harrison at the preliminary.
60
26. Evidentiary harpoons from Det. Harrison as to other crimes.
61
27. Violation of the plea agreement by defense counsel and the State.
62
28. Multiple conflicts of interest on the part of defense counsel and the State.
63
29. Court's admission of pre-posed photos.
64
30. Illegal arrest of this petitioner.
65
31. Possible use of hypnotic suggestion to obtain alleged statement.
66
32. Failure to disclose the agreement the State made with informer Groshon.
67
33. Violation of this petitioner's rights by the Oklahoma City Police in conducting further interrogation after this petitioner asked for an attorney.
68
34. Failure to supply true and correct records in this case. 21 O.S. 701.13.
69
35. Trial court's failure to inform petitioner of his mandatory forty-eight hours, and receipt of defendant's waiver before judgment was entered. 22 O.S. 961, 962.
70
36. Trial court's failure to address this petitioner personally in accepting his plea.
71
37. State court's failure to provide counsel in petitioner's first appeal via post-conviction application denying petitioner of his 6th and 14th Amendment rights, when asked for by motion.
72
38. Petitioner is an uneducated layman to the matters of law and would ask the court to consider all pleadings, asnwers and applications, etc., that have been filed in connection with this case in a liberal manner and also consider appointment of counsel to this petitioner.
*
The Honorable David Sam, United States District Judge for the District of Utah, sitting by designation
1
Worthen asserted numerous other claims below alleging constitutional violations that had occurred prior to his guilty plea. See appendix attached hereto. The district court held that, under Tollett v. Henderson, 411 U.S. 258, 267, 93 S.Ct. 1602, 1608, 36 L.Ed.2d 235 (1973), Worthen could not raise these independent pre-plea claims. Worthen does not cite this ruling as error on appeal
2
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); 10th Cir.R. 34.1.8. The cause is therefore ordered submitted without oral argument
3
Worthen wrote the state court judge a pro se letter filed September 20, 1982, three weeks after his guilty plea, in which he requested a new trial. This request was denied. In March 1985, Worthen filed a motion to withdraw his guilty plea and proceed to trial, which was also denied | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1031417/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-6650
WILLIAM HENCELY DAVIS, JR.,
Petitioner - Appellant,
v.
STATE OF NORTH CAROLINA; D.G. WOOD, Superintendent; WALLACE
W. DIXON, Magistrate Judge; FRANK W. BULLOCK, JR., Judge; N.
CARLTON TILLEY, Judge,
Respondents - Appellees.
Appeal from the United States District Court for the Middle
District of North Carolina, at Greensboro. Thomas David
Schroeder, District Judge. (1:08-cv-00706-TDS-PTS)
Submitted: January 19, 2010 Decided: January 26, 2010
Before NIEMEYER, KING, and DAVIS, Circuit Judges.
Dismissed by unpublished per curiam opinion.
William Hencely Davis, Jr., Appellant Pro Se.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
William Hencely Davis, Jr., filed a pleading seeking
both coram nobis relief from his state conviction as well as
Fed. R. Civ. P. 60(b) relief on his 28 U.S.C. § 2254 (2006)
petition. The district court adopted the magistrate judge’s
recommendation and denied relief. To the extent that Davis
sought to challenge his conviction, the district court found
that his pleading was a successive § 2254 petition and dismissed
it on that basis. The court also found that Davis was not
entitled to relief under Rule 60. Davis seeks to appeal.
The order is not appealable unless a circuit justice
or judge issues a certificate of appealability. 28 U.S.C.
§ 2253(c)(1) (2006); Reid v. Angelone, 369 F.3d 363, 369 (4th
Cir. 2004). A certificate of appealability will not issue
absent “a substantial showing of the denial of a constitutional
right.” 28 U.S.C. § 2253(c)(2) (2006). A prisoner satisfies
this standard by demonstrating that reasonable jurists would
find that any assessment of the constitutional claims by the
district court is debatable or wrong and that any dispositive
procedural ruling by the district court is likewise debatable.
Miller-El v. Cockrell, 537 U.S. 322, 336-38 (2003); Slack v.
McDaniel, 529 U.S. 473, 484 (2000); Rose v. Lee, 252 F.3d 676,
683-84 (4th Cir. 2001). We have independently reviewed the
record and conclude that Davis has not made the requisite
2
showing. Accordingly, we deny a certificate of appealability
and dismiss the appeal. We also deny Davis’ motions to amend or
correct the caption and for appointment of counsel. We dispense
with oral argument because the facts and legal contentions are
adequately presented in the materials before the court and
argument would not aid the decisional process.
DISMISSED
3 | 01-03-2023 | 07-05-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1031418/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-7055
DAVID HALL CRUM,
Plaintiff - Appellant,
v.
BUREAU OF PRISONS; HARRELL WATTS,
Defendants - Appellees.
Appeal from the United States District Court for the Southern
District of West Virginia, at Beckley. Thomas E. Johnston,
District Judge. (5:08-cv-00090)
Submitted: January 19, 2010 Decided: January 26, 2010
Before NIEMEYER, KING, and DAVIS, Circuit Judges.
Affirmed by unpublished per curiam opinion.
David Hall Crum, Appellant Pro Se.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
David Hall Crum appeals the district court’s order
denying relief on his complaint filed pursuant to Bivens v. Six
Unknown Named Agents of Fed. Bureau of Narcotics, 403 U.S. 388
(1971). The district court referred this case to a magistrate
judge pursuant to 28 U.S.C. § 636(b)(1)(B) (2006). The
magistrate judge recommended that relief be denied citing, among
other grounds, that Crum failed to exhaust administrative
remedies, and advised Crum that failure to file timely
objections to this recommendation could waive appellate review
of a district court order based upon the recommendation.
Despite this warning, Crum filed no objections to the magistrate
judge’s finding that he failed to exhaust administrative
remedies. Crum now seeks to challenge the dismissal of his
action on this basis.
The timely filing of specific objections to a
magistrate judge’s recommendation is necessary to preserve
appellate review of the substance of that recommendation when
the parties have been warned of the consequences of
noncompliance. Wright v. Collins, 766 F.2d 841, 845-46 (4th
Cir. 1985); see also Thomas v. Arn, 474 U.S. 140 (1985). Crum
has waived appellate review of the dismissal for failure to
exhaust administrative remedies by failing to file specific
objections after receiving proper notice. Accordingly, although
2
we grant Crum leave to proceed in forma pauperis, we affirm the
judgment of the district court.
We dispense with oral argument because the facts and
legal contentions are adequately presented in the materials
before the court and argument would not aid the decisional
process.
AFFIRMED
3 | 01-03-2023 | 07-05-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603215/ | 8 So.3d 1147 (2009)
BLAYLOCK
v.
STATE.
No. 5D08-3116.
District Court of Appeal of Florida, Fifth District.
May 15, 2009.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3357052/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]MEMORANDUM OF DECISION RE: MOTION TO STRIKE
Defendant John Hocursak has moved to strike the complaint on grounds which he sets forth in a memorandum of law but not in his motion to strike. Plaintiff Helen Lane claims, inter alia, that the motion should be denied because the defendant failed to specify in the motion to strike the reasons for the purported legal CT Page 220 insufficiency of the complaint. For the reason stated below, the motion to strike is denied without prejudice to the defendant's raising the claimed insufficiencies in another motion to strike.
Since the plaintiff has objected to the form of the defendant's motion to strike, this court must determine whether the motion complies with Practice Book § 154. See Bouchard v. People'sBank, 219 Conn. 465, 468 n. 4, 594 A.2d 1 (1991). "Practice Book § 154 . . . requires that a motion to strike based on legal insufficiency distinctly specify the reason or reasons for each such claimed insufficiency." Blancato v. Feldspar Corp. ,203 Conn. 34, 36-37 n. 3, 522 A.2d 1235 (1987). "[A] motion to strike that does not specify the grounds of insufficiency is `fatally defective.'" Morris v. Hartford Courant Co., 200 Conn. 676, 683
n. 5 513 A.2d 66 (1986). "A general statement in a motion to strike that the complaint does not state a claim on which relief can be granted is usually deemed not to comply with the requirement of Practice Book § 154." North Park Mortgage Services, Inc. v.Pinette, 27 Conn. App. 628, 630, 608 A.2d 714 (1992). Practice Book § 155, which requires a motion to strike to be accompanied by an appropriate memorandum of law citing the legal authorities upon which the motion relies, does not dispense with the requirement of § 154 that the reasons for the claimed pleading deficiency be specified in the motion itself." Blancato v. Feldspar Corp. supra,203 Conn. 36-37 n. 3. Because the defendant's motion to strike does not specify the grounds of insufficiency, the motion is "fatally defective." See Bouchard v. People's Bank, supra at 468, n. 4.
The defendant has attempted to raise what appear to be meritorious issues. Accordingly, the court acting pursuant to § 113 of the Practice Book grants the defendant permission to file another motion to strike.
THIM, J. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1605452/ | 778 F. Supp. 954 (1990)
LA-Z-BOY CHAIR COMPANY, Plaintiff,
v.
David REED, Defendant.
No. Civ-1-89-82.
United States District Court, E.D. Tennessee, S.D.
June 27, 1990.
Phillip A. Fleissner, Fleissner, Cooper & Marcus, Chattanooga, Tenn., for plaintiff.
Stephen Crofford, Nashville, Tenn., for defendant.
MEMORANDUM
EDGAR, District Judge.
The issue in this case is whether David Reed has a claim for worker's compensation benefits under the laws of the State of Tennessee. More specifically, the issue is whether he has suffered an "injury" as that term is defined by Tenn.Code Ann. § 50-6-102(a)(4). That statute provides:
"Injury" and "personal injury" means an injury by accident arising out of and in the course of employment which causes either disablement or death of the employee and shall include occupational diseases arising out of and in the course of employment which cause either disablement or death of the employee.
The Tennessee Workers' Compensation Law in Tenn.Code Ann. § 50-6-301 further defines the term "occupational diseases" as follows:
As used in the Workers' Compensation Law, the term "occupational diseases" shall mean all diseases arising out of and in the course of employment. A disease shall be deemed to arise out of the employment only if:
(1) It can be determined to have followed as a natural incident of the work as a result of the exposure occasioned by the nature of the employment;
(2) It can be fairly traced to the employment as a proximate cause;
*955 (3) It has not originated from a hazard to which workers would have been equally exposed outside of the employment;
(4) It is incidental to the character of the employment and not independent of the relation of employer and employee;
(5) It originated from a risk connected with the employment and flowed from that source as a natural consequence, though it need not have been foreseen or expected prior to its contraction; and
(6) There is a direct causal connection between the conditions under which the work is performed and the occupational disease. Provided, further, that diseases of the heart, lung, and hypertension arising out of and in the course of any type of employment shall be deemed to be occupational diseases.
La-Z-Boy Chair Company ("La-Z-Boy") filed this action seeking a declaration of its non-liability to its former employee, David Reed. This Court has jurisdiction under 28 U.S.C. § 1332 and 28 U.S.C. §§ 2201 and 2202. Defendant Reed has in effect counterclaimed for worker's compensation benefits.
Reed claims that he is permanently disabled as a result of exposure to 1.1.1 trichloroethane while employed at La-Z-Boy. Mr. Reed's case is based upon the testimony of Dr. Fred Furr, who practices a curious form of medicine known as "clinical ecology." Without dwelling upon the precise nature of what a clinical ecologist is, it is Dr. Furr's opinion in this case that Mr. Reed was exposed to 1.1.1 trichloroethane (methyl chloroform) while employed at La-Z-Boy; that this exposure caused Mr. Reed to develop a "chemical sensitivity" to various other chemicals and odors; that this chemical sensitivity has resulted in shortness of breath, general respiratory problems, lack of endurance and swelling in Mr. Reed's eyes; and that Mr. Reed is, therefore, permanently disabled for the purposes of the Tennessee Workers' Compensation Law.
The problem with Dr. Furr's testimony is that there is no medical or scientific basis whatsoever for it. Dr. Furr's contention that somehow Mr. Reed's exposure to 1.1.1 trichloroethane caused a disregulation or suppression of Reed's immune system cannot be explained medically. It is only a theory which is not generally accepted by the medical profession. As such, Dr. Furr's opinion cannot be relied upon to sustain Mr. Reed's case. Sterling v. Velsicol Chemical Corp., 855 F.2d 1188, 1209 (6th Cir.1988).
While Mr. Reed may have had some moderate exposure to 1.1.1 trichloroethane at La-Z-Boy, that exposure was well below ambient air limits set by the Occupational Safety and Health Administration ("OSHA"), and would not have had any effect whatsoever on him.[1] There is no evidence that exposure to 1.1.1 trichloroethane causes any of the symptoms which Mr. Reed now has.
A worker's compensation award cannot be based upon conjecture. It must be based on material evidence. Parker v. Ryder Truck Lines, Inc., 591 S.W.2d 755, 759 (Tenn.1979). Mr. Reed has presented the Court with no such evidence. Mr. Reed does have some medical problems. However, they did not arise out of and in the course of his employment at La-Z-Boy as specified by Tenn.Code Ann. §§ 50-6-102(a)(4) and 50-6-301.
NOTES
[1] Mr. Reed's wife currently works at La-Z-Boy in the same department as Mr. Reed last worked. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1605456/ | 778 F. Supp. 244 (1991)
Linwood BLACKSTON, et al., Plaintiffs,
v.
UNITED STATES of America, Defendant.
Civ. A. No. MJG-88-1454.
United States District Court, D. Maryland.
November 25, 1991.
*245 Stephen P. Kauffman, Wright, Constable & Skeen, Baltimore, Md., for plaintiffs.
Michael J. Martineau, U.S. Dept. of Justice, Washington, D.C., Larry D. Adams, Asst. U.S. Atty., Baltimore, Md., for defendant.
GARBIS, District Judge.
Plaintiffs Linwood Blackston and Barbara Blackston ("the taxpayers") are, and were at all times relevant to this case, citizens of the United States residing in Baltimore, Maryland. The taxpayers filed timely Joint Federal Income Tax Returns for the years 1979, 1980, and 1981. On or about April 15, 1983, the Internal Revenue Service issued a statutory notice of deficiency for the years 1977 through 1981. The taxpayers contested the proposed deficiencies in the United States Tax Court. Ultimately, the Tax Court case was resolved by a settlement (stipulated decision) in which the parties agreed to the following deficiencies in tax and penalties (plus interest thereon in accordance with law):
Penalty
Year Tax (Negligence)
1977 0 0
1978 0 0
1979 $2,577 $129
1980 $4,405 $220
1981 $4,480 $224
The above-noted deficiencies for 1979, 1980, and 1981 were assessed on January 28, 1985, pursuant to § 6503(a)(1).[1]
The issues presented are whether the Internal Revenue Service has complied with § 6303(a) of the Internal Revenue Code by giving notice to the taxpayers stating the amount due and demanding payment within 60 days after the making of the subject assessments and, if not, what is the effect of the Service's failure.
*246 Jurisdictional Prerequisites
The substantive issues concern the validity of assessments of deficiencies in income tax, penalties and interest for the years 1979, 1980 and 1981. As to the year 1979, the taxpayers made full payment on or about March 18, 1988 and timely filed a claim for refund on or about the same date. On May 4, 1988 the claim for refund was denied. The taxpayers timely commenced this action, seeking a refund with regard to the year 1979. § 6532(a). Thus, the jurisdictional prerequisites have been met for the taxpayers to sue for a refund for 1979. See, generally, M. Garbis, P. Junghans, S. Struntz, Federal Tax Litigation, Para. 15.01 et seq. (1985).
As to 1980 and 1981, the Government filed a Counterclaim to reduce to judgment the balance due on the assessments for those years. By virtue of the Government's counterclaim, the Court has jurisdiction to determine the validity of the 1980 and 1981 assessments. See Id. Par. 15.02[6]
Noncompliance With Section 6303(a)
Section 6303(a) provides in relevant part that:
... [The IRS] shall, as soon as practicable, and within 60 days after the making of an assessment of a tax ... give notice to each person liable for the unpaid tax, stating the amount and demanding payment thereof. Said notice shall ... be sent by mail to such person's last known address.
The I.R.S. records reflect that a first notice of assessment and demand for payment ("Notice and Demand") was mailed to the taxpayers at their current address on or about January 28, 1985, within 60 days of the assessments. It is stipulated, however, that the first notice which the taxpayers actually received relating to the subject deficiencies was dated May 31, 1985-more than 60 days after the assessments. The question presented is whether the Service in fact properly mailed a notice and demand on or about January 28, 1985 as reflected in its computer generated records.[2]
It is the Government's position that the mere fact that the Internal Revenue Service is able to present a computer generated printout reflecting that a Notice of Demand had been sent on January 28, 1988 establishes an irrebuttable presumption that the notice was in fact sent. This Court rejects this position. A similar contention had been rejected by the district court in the case of United States v. Berman, 825 F.2d 1053, 1056-57 (6th Cir.1987). As found by the trial court in the Berman case, and as this Court finds from the evidence presented here, there are sufficient irregularities presented in the IRS computer evidence to cause this Court to doubt its reliability. Therefore, the Court refuses to accept the records as conclusive. In particular, the Court notes that the I.R.S. records reflect the mailing of a first notice on January 28, 1985 and the mailing of a second notice some four months later on May 31, 1985. However, the IRS Service Center computer is programmed to send the second notice five weeks after the first notice. M. Saltzman, IRS Practice and Procedure Para. 14.03(3) (2nd ed. 1991) and Para. 14.03 (1st ed. 1981); See also Salchow, IRS Practice & Policy, Para. 1010.A.2.a (1991).
This Court was sufficiently concerned about the matter to ask the Government at argument, and in a post trial Order, the following:
The I.R.S. records reflect the mailing of a first notice on January 28, 1985 and a second notice on May 31, 1985 (a four month period) while the I.R.S. manual allegedly indicates that there would be a much shorter period between a first and second notice. How can this inconsistency be explained without resulting in uncertainty *247 as to the accuracy of either the January or May date, or both?
In response the Government stated:
[A]fter consultation with the appropriate IRS representative, the United States does not intend to proffer any further evidence on this particular point.
The Court interprets this response to mean that the Government cannot provide any satisfactory answer to the Court's question. Therefore, on the record in this case, which includes the Government's refusal (or inability) to provide an explanation of the inconsistency of its computer generated records as to the date of the first notice,[3] the Court finds as a fact that the IRS did not comply with § 6303(a) by sending a Notice and Demand within 60 days of the subject assessments. This finding requires the Court to address the question of the effect of such a failure.
Effect of Noncompliance with Section 6303(a)
Having found that the IRS failed to comply with § 6303(a) by not sending a notice and demand within 60 days of the subject assessments, the Court must determine the effect of such a failure. In this case, the issue arises in both a refund context[4] and in a collection context.[5] In both contexts the issue presented is whether the failure to send a timely notice and demand renders the January 28, 1985 assessment void altogether or whether it leaves the assessment valid but bars the Internal Revenue Service from utilizing its lien and levy collection powers.
There is no Fourth Circuit precedent addressing the issue presented. The decisions in other circuits addressing the absence of a timely notice and demand do not answer all of the questions presented in this case. See United States v. Chila, 871 F.2d 1015 (11th Cir.1989); United States v. Berman, 825 F.2d 1053 (6th Cir.1987) on remand U.S.T.C. 88-2 Para. 9550, 1988 WL 126557 (S.D.Ohio 1988) after remand 884 F.2d 916 (6th Cir.1989); Marvel v. United States, 719 F.2d 1507 (10th Cir.1983). Nevertheless, this Court concludes, consistent with the views expressed in Berman, Marvel, and Chila that the appropriate "sanction" against the I.R.S. for its failure to comply the § 6303(a) notice and demand requirement is to take away its awesome nonjudicial collection powers. It would be irrational to conclude that an assessment becomes void after 60 days if there is no notice and demand. Such a rule of law would serve only to provide a windfall to permit taxpayers to avoid paying valid assessments of determined tax liabilities because of an I.R.S. clerical error in failing to mail a notice and demand to the taxpayer's last known address.
The Court's decision is in accord with the views of leading publications on federal tax procedures. As stated in M. Saltzman, IRS Practice and Procedure, Para. 14.05(2) (2nd ed. 1991):
Under the collection mechanism established by the Code, once tax has been assessed, a taxpayer is subject to the summary nonjudicial procedures (lien and levy) available to the Service to collect the assessed tax. The notice and demand provided by Section 6303 gives the taxpayer warning that the taxpayer must take some action to resolve the delinquent account if these summary collection procedures are to be avoided. Thus, preseizure notice serves an important practical, and possibly a due process, purpose in the statutory scheme. A taxpayer's liability is recorded by the official act of assessment, but where no Section 6303 notice is given, or an invalid notice is given, a statutory prerequisite is missing and, absent compliance with the Code, any collection action that follows is invalid. No lien can arise, nor can a levy be effective, absent a notice and demand. *248 Where the government elects to collect tax by a civil suit, the complaint gives the taxpayer notice, and collection cannot be taken without court approval. A Section 6303 notice does not appear to be required where liability is asserted in a judicial proceeding. [Footnotes in original omitted]
And, as stated in Salchow, IRS Practice & Policy, Para. 1010.A.2.d (1991):
Since the administrative collection remedies require a timely and properly issued notice and demand, it is in the taxpayer's interest initially to determine whether the IRS made such notice and demand. The general rule is that no tax lien arises until the IRS makes a demand for payment. Myrick v. United States, 296 F.2d 312 (5th Cir.1961). Without a valid notice and demand, there can be no tax lien; without a tax lien, the IRS cannot levy against the taxpayer's property. The IRS' failure to serve a timely notice and demand, however, does not prevent the government from instituting a judicial proceeding to collect the tax liability. United States v. Chila, 871 F.2d 1015 (11th Cir.1989); United States v. Berman, 825 F.2d 1053 (6th Cir.1983); Marvel v. United States, 719 F.2d [1507] 1513 (10th Cir.1983).
The 1979 Refund Claim
As to the year 1979, the outcome depends upon the manner in which the taxes were collected. That is, was collection effected by the illegal use of liens and levies in the absence of a notice and demand. If so, the taxpayers would be entitled to a refund.[6] Here, the 1979 taxes were paid by the taxpayers' check and not through the use of the lien or levy power. Accordingly, there can be no refund for 1979.
The Court has considered the argument that the taxpayers here paid by check only because of the threat of nonjudicial collection action. Hence, it could be argued that the I.R.S., as a practical matter, did utilize its nonjudicial collection powers. However, it is fair to say that many, if not virtually all, tax payments are made because the taxpayer realizes that a failure to pay what is owed will result in I.R.S. collection activity. Accordingly, the effect of the taxpayer's argument would be to provide a windfall to all taxpayers who do not receive a timely notice and demand but pay their tax liability anyhow. Thus, in a not uncommon situation, the I.R.S. might innocently misaddress a notice and demand but the taxpayer would nevertheless become aware of the assessment more than 60 days after it is made. At that point the taxpayer could (and should) pay the I.R.S. (resulting in a closing of the account) without any reason for the IRS to be aware that it had made a clerical error in issuing a notice and demand. It would be strange indeed if this would result in giving the taxpayer the ability to get a refund of the payment and avoid entirely his determined liability.
It should further be noted that a § 6303(a) "violation" occurs 60 days after the assessment. Therefore, if the taxpayer's position were correct, a valid assessment would become invalid on the 61st day after assessment because of the nonoccurrence of an event, i.e. a properly addressed notice and demand. There is nothing to indicate to this Court that such retroactive invalidation was intended or makes any sense at all.
This Court concludes that § 6303(a) was placed in the Code to insure that taxpayers received notice of tax liability so that they could make "voluntary" payment before the I.R.S. could use its lien and levy collection powers. Therefore, the purpose of the statute would be served by preventing the I.R.S. from the exercise of this power where it has not complied with § 6303(a). To go further and eliminate a taxpayer's *249 duly determined liability would be neither consistent with the statutory scheme nor sensible.
The 1980 and 1981 Counterclaim
As to 1980 and 1981, the Government has sued to reduce to judgment the assessments made on January 28, 1985. The taxpayers have defended in reliance on the statute of limitations. In essence, the taxpayers contend that the January 28, 1985 assessments were rendered invalid once 60 days passed without notice and demand. Therefore, they say, the Government could only sue on the underlying tax liability and not on the assessment. Accordingly, since the Counterclaim was filed after the running of limitations for a suit on the liability itself and not the assessment, the taxpayers would be entitled to judgment.[7]
It is the Government's position, with which the Court agrees, that the January 28, 1985 assessment was, and remains, valid and that the Counterclaim was timely filed to reduce the assessment to judgment pursuant to § 6502(a).[8] The Counterclaim is, in effect, a collection suit, which is permitted even though there had been no notice and demand. Chila, supra, Berman, supra, Marvel, supra. Thus, the Counterclaim was timely filed and, there being no debate as to the substantive merit of the assessments, the Government is entitled to judgment.
Conclusion
For the foregoing reasons, the Court holds in favor of the Government on the Plaintiff's suit for refund for 1979 and on the Government's Counterclaim to reduce its assessments to judgment for 1980 and 1981.
NOTES
[1] All statutory references herein are to the Internal Revenue Code, 26 U.S.C.
[2] The Government, quite correctly, notes that the fact that the taxpayers did not receive the alleged January 28, 1985 first notice is not determinative. So long as the notice was timely mailed to the taxpayers' last known address, the IRS has complied with § 6303(a) even absent receipt.
[3] If the first and second notices were, in fact, mailed 5 weeks apart then the computer records are erroneous as to the January 28, 1985 date for the first notice and/or the May 31, 1985 date for the second notice.
[4] I.e. for 1979 as to which the taxpayers have made full payment and seek recovery of what they have paid.
[5] For 1980 and 1981 the IRS has filed suit to reduce an assessment of judgment.
[6] In the case of Sasscer v. United States, MJG-91-158 (D.Md.) the Government stated:
"This letter is in response to your order dated May 8, 1991, in which you requested the United States' position as to whether a taxpayer is entitled to a refund on the sole ground that the liability was collected by administrative levy in the absence of a notice and demand. The United States' position is that the taxpayer would be entitled to a refund, as long as he filed his claim for refund with the Internal Revenue Service within two years from the time the funds were administratively collected."
[7] § 6502(a)(1). A suit on the tax liability (sans assessment) would be timely if brought within three years from the date the return was filed plus the period of time during which the running of limitations was extended by virtue of the Tax Court litigation. § 6503(a). It appears that this period of limitations would have expired prior to the 1988 filing of the Government's counterclaim in this case.
[8] The period of limitations for suit on the January 25, 1985 assessments was originally six years and was, in 1990, extended to ten years. Omnibus Budget Reconciliation Act of 1990, § 11317(a)(1), amending IRC § 6502(a). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552269/ | 41 B.R. 348 (1984)
In re Kinder Allen ELIJAH and Maude Eulalia Elijah, Debtors.
Bankruptcy No. 82-03082-S-11.
United States Bankruptcy Court, W.D. Missouri, S.D.
August 6, 1984.
*349 Max W. Lilley, Springfield, Mo., for creditors Moss.
James E. Miller, Springfield, Mo., for Kentland Bank.
Thomas J. Carlson, Springfield, Mo., for creditor Smith.
Fred Charles Moon, Springfield, Mo., for West Plains Bank.
MEMORANDUM OPINION AND ORDER
JOEL PELOFSKY, Bankruptcy Judge.
Debtors, who are an elderly farm couple, purchased two tracts of land totalling 2,624 acres in Wright and Howell Counties in Missouri. They traded some Indiana land for part of the price and made substantial cash payments. Five creditors, Federal Land Bank, West Plains Bank, Sherman Smith, Kentland Bank and Donald and Eileen Moss took deeds of trust in various portions of the property. After a downturn in the farm economy, debtors filed for bankruptcy in 1982.
In their plan they propose to surrender part of the property to the creditors to satisfy their secured positions in full. Debtors assert that these creditors are oversecured and that the proposal leaves them unimpaired. The creditors contest this characterization and contend that they can only be paid by surrender of all of their collateral. The Court heard argument and briefs were filed on the issues raised by the plan. The issues were submitted to the Court on the assumption that all of the creditors were oversecured but no evidence was produced by any party on that assumption and there would probably be some dispute as to valuation.
I
Debtors assert that because creditors are paid in full by surrender of collateral that they are not impaired within the meaning of the Code. Creditors disagree. Resolution of the question is important as unimpaired creditors are deemed to accept the plan, Section 1126(f) of the Code, and may not be able to vote against confirmation. 5 Collier on Bankruptcy ¶ 1126.06 (15th Ed.). But see Marston Enterprises, Inc., 13 B.R. 514, 7 B.C.D. 1403 (BC ED NY 1981). Compare In re Masnorth Corp., 28 B.R. 892 (BC ND Ga.1983).
Section 1124 of the Code, Title 11, U.S.C., defines impairment, providing that:
"a class of claims or interests is impaired under a plan unless, with respect to each claim or interest of such class, the plan
(1) leaves unaltered the legal, equitable, and contractual rights to which such claim or interest entitles the holder of such claim or interest;
*350 (2) notwithstanding any contractual provision or applicable law that entitles the holder of such claim or interest to demand or receive accelerated payment of such claim or interest after the occurrence of a default
(A) cures any such default, other than a default of a kind specified in section 365(b)(2) of this title, that occurred before or after the commencement of the case under this title;
(B) reinstates the maturity of such claim or interest as such maturity existed before such default;
(C) compensates the holder of such claim or interest for any damages incurred as a result of any reasonable reliance by such holder on such contractual provision or such applicable law; and
(D) does not otherwise alter the legal, equitable, or contractual rights to which such claim or interest entitles the holder of such claim or interest; or
(3) provides that, on the effective date of the plan, the holder of such claim or interest received, on account of such claim or interest, cash equal to
(A) with respect to a claim, the allowed amount of such claim; or
(B) with respect to an interest, if applicable, the greater of
(i) any fixed liquidation preference to which the terms of any security representing such interest entitle the holder of such interest; and
(ii) any fixed price at which the debtor, under the terms of such security, may redeem such security from such holder".
The debts owed to these secured creditors call for periodic payments in cash with interest. Alternatively the instruments of debt permit the creditor to foreclose and repossess the collateral. The plan does not propose cash payments; rather, it proposes surrender of some of the collateral. In fact, in one instance, it proposes that the creditor exchange collateral in which he holds an interest for an interest in other property to be surrendered. The plan does propose to cure any defaults by payment of the amount of the claim with interest, but not in cash. Any defaults are to be cured by surrender of a portion of the collateral.
Debtors advance the notion that payment in full to a creditor, however such payment is accomplished, causes such a creditor to be unimpaired. Such an argument is not a fair reading of Section 1124. First the statute provides that a creditor is unimpaired if its "legal, equitable and contractual rights" are unaltered. A plan which neither pays the debt as required by the debt instrument nor surrenders all the collateral does alter rights. The wording is clear. Alteration is synonymous with impairment. See, for example, In re Madison Hotel Associates, 29 B.R. 1003 (DC WD Wis.1983).
There is an exception to this broad reading. Under Section 1124(2), the debtor may cure a default by de-accelerating a mortgage, provided other creditor rights are unaltered. In re Taddeo, 685 F.2d 24 (2d Cir.1982). But any other change in the arrangement between debtor and creditor constitutes impairment. In re Otero Mills, Inc., 31 B.R. 185 (BC N.M.1983); In re Barrington Oaks General Partnership, 15 B.R. 952 (BC Utah 1981).
In Otero Mills, supra, debtor proposed to pay a creditor upon sale of the collateral. The Court held that the shift in payments from monthly installments to a lump sum payment sometime in the future was an alteration of the creditors' contractual rights and impaired its status. In Barrington Oaks, supra, the debtor proposed to sell the property to a third party which would assume the obligation (a non-recourse secured note) to the creditor. The Court held that substitution of debtors constituted an impairment under Section 1124.
These provisions concerning impairment result from experience under Section 107 of Chapter X of the Bankruptcy Act, Section 507, Title 11, U.S.C. That section provided in part that creditors "shall be deemed to be `affected' by a plan only if their . . . interest shall be materially and adversely affected thereby". Where a plan did not disturb the position of an oversecured creditor, *351 such a creditor was not materially and adversely affected. Central States Life Ins. Co. v. Koplar Co., 85 F.2d 181 (8th Cir.1936). See also 5 Collier on Bankruptcy ¶ 1124.01 (15th Ed.).
A reading of the language of Section 1124 suggests that impairment is no longer limited to material and adverse effects. The legislative history is in disagreement as to whether this approach is a mere continuation of the prior analysis, Senate Report No. 95-989, 95th Cong., 2d Sess. 120 (1978), or is new, House Report No. 95-595, 95th Cong., 1st Sess. 408 (1977), U.S.Code Cong. & Admin.News 1978, p. 5787. Collier suggests that the difference is more apparent than real. 5 Collier on Bankruptcy ¶ 1124.02 (15th Ed.).
But when balanced against the right to vote on confirmation, it is not difficult to conclude that Section 1124 is to be read broadly. When the relationship to the debtor is changed, the creditor ought to have the right to express a formal opinion about the change. 5 Collier on Bankruptcy ¶ 1124.03, 1125.06, 1129.02[8] (15th Ed.); In re Madison Hotel Associates, supra. The Court concludes, therefore, that the limitations expressed in Section 1124 should be read liberally to effectuate the purposes of the Code, encouraging creditors to be involved actively in the reorganization process. The Court holds that these creditors are impaired under the plan proposed by debtors and are eligible to vote on confirmation.
II
Some but not all of these secured creditors have made election to have their claims treated as fully secured under Section 1111(b) of the Code. They argue that this election prevents the debtor from returning less than all of the collateral in which they hold an interest in satisfaction of their respective claims.
If an election under § 1111(b) is made "then notwithstanding section 506(a) of this title, such claim is a secured claim to the extent that such claim is allowed". The purpose of the election is to avoid the splitting of an undersecured creditor's claim into secured and unsecured portions, and to prevent the debtor from depriving the creditor of the benefit of appreciation in value of the asset over time. Matter of Pine Gate Associates, Ltd., 2 B.C.D. 1478 (BC ND Ga.1976); 5 Collier on Bankruptcy ¶ 1111.02 (15th Ed.); In re Griffiths, 27 B.R. 873, 10 B.C.D. 173 (BC Kan.1983); Stein Section 1111(b); Providing Undersecured Creditors with Postpetition Appreciation, 56 Am.Bankr.L.J. 195 (1982); Pusateri, Section 1111(b) of the Bankruptcy Code, 58 Am.Bankr.L.J. 129 (1984).
In Griffiths, supra, the Court held that a debtor could not cash out an undersecured electing creditor by returning part of the collateral in which the creditor held an interest and paying the remaining value of the collateral in full satisfaction of the claim. It follows from that analysis that a debtor could return part of the collateral which value fully satisfied the claim. It also follows that a debtor could return part of the collateral and pay the balance of the claim in cash.
Here the creditors are assumed to be oversecured for purposes of this analysis. The debtor could return part of the collateral and pay creditors in full. What value is the election then? Obviously it cannot have the expected effect of preventing the creditor's claim from being divided into secured and unsecured portions. It does preserve the creditor's interest in the collateral. By surrendering collateral in kind rather than selling it and distributing the proceeds the debtor necessarily, no matter how sophisticated and voluminous the appraisals, makes a guess as to value. If the creditor sells the surrendered collateral and the sale price is less than the claim, the impact of the election is that the creditor could require the debtor to surrender more collateral or to pay the balance of the claim as secured. The election avoids the deficiency. Compare In re Fursman Ranch, 38 B.R. 907, 11 B.C.D. 985 (BC WD Mo. 1984) where the oversecured creditors made no election. While the Court there *352 suggested reconsideration of the value of the surrendered property if the sale price did not match the appraisals, the basis for such reconsideration would be equitable principles of unjust enrichment rather than the election.
The Court finds that debtors may propose in their plan the return of part of the collateral in which creditors hold an interest in full satisfaction of the debt but also finds that if a sale of the surrendered collateral does not pay the claims in full, the deficiency must be treated as a secured claim.
III
Debtors propose to give one secured creditor, Sherman Smith, a junior lien in property to be surrendered in return for his first deed of trust position in a portion of the property to be retained. The creditor objects. Theoretically such a proposal could be confirmed because the sale of the surrendered property will produce sufficient proceeds to pay all of the lienholders. Country Life Apartments, Inc. v. Buckley, 145 F.2d 935 (2d Cir.1944). There is, of course, no guarantee of such a result. Alternatively this creditor who holds a small claim, in order to protect his secured position, might have to spend substantial sums of money to buy out senior lienholders. Can this creditor be compelled to accept this arrangement?
The Court has ruled that this creditor is impaired. The creditor assumed that he was impaired and suggested that he would vote against confirmation. On that state of facts, the Court would, therefore, have to confirm under the provisions of Section 1129(b) which requires that the plan "does not discriminate unfairly and is fair and equitable, with respect to each class of claims . . . that is impaired under, and has not accepted, the plan".
Section 1129(b)(2) defines fair and equitable as to a class of secured claims as requiring inter alia "that the holders of such claims retain the lien securing such claims, whether the property subject to such lien is retained by the debtor or transferred to another entity, to the extent of the allowed amount of such claims . . .". The legislative history states that the test is a codification of the absolute priority rule. House Report No. 95-595, 95th Cong., 1st Sess. 413-414. In re Barrington Oaks General Partnership, supra. The absolute priority rule requires that senior creditors receive the full benefit of their bargain before treatment of junior claims. Case v. Los Angeles Lumber Products Co., 308 U.S. 106, 60 S. Ct. 1, 84 L. Ed. 110 (1939); Securities and Exch. Com'n v. United States Realty & Improvement Co., 310 U.S. 434, 60 S. Ct. 1044, 84 L. Ed. 1293 (1940).
The Court holds that the proposal to substitute security as to creditor Smith violates the absolute priority rule. According to debtors' plan, the substitution takes Smith's first position and gives him an indeterminate one. On appearances his position in the property to be surrendered looks like a third deed of trust. Junior lienholders might then be paid before him. The proposal is neither fair nor equitable. The Court also holds that the proposal is discriminatory as to Smith. His is the only first position which is subordinated to the positions of other secured creditors.
In addition, the Court notes that the whole proposal to surrender property in satisfaction of debt may be defective in that there is no provision for recapture of funds if the sale of the property produces an excess over the present value of the claim of creditors. Oversecured creditors are entitled to receive only the present value of the allowed amount of their claim in cash. Section 1124(3)(A) of the Code; Section 1129(a)(7) of the Code. Unlike foreclosure, the creditors here are not entitled to whatever the property brings at a sale but only the amount of their claim.
IV
Debtors are granted to August 17, 1984 to amend their plan in accordance with the Court's holdings as hereinabove set out. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552282/ | 41 B.R. 833 (1984)
In re DAVID N. RAUSCH, INC., d/b/a Farmer/Rancher, Case No. 382-00076, and David Nick Rausch and Mary Susan Rausch, d/b/a Farmer/Rancher, Case No. 382-00077, Debtors.
Bankruptcy Nos. 382-00076, 382-00077, Joint Administration No. 382-00076.
United States Bankruptcy Court, D. South Dakota.
August 31, 1984.
*834 Craig E. Smith, Neumayer & Smith, Gettysburg, S.D., for First Bank Gettysburg.
William J. Pfeiffer, Aberdeen, S.D., for debtors David N. Rausch, Inc., d/b/a Farmer/Rancher, and David Nick Rausch and Mary Susan Rausch, d/b/a Farmer/Rancher.
William P. Westphal, Minneapolis, Minn., United States Trustee.
MEMORANDUM DECISION
PEDER K. ECKER, Bankruptcy Judge.
The above-entitled matter is before the Court on the application of First Bank Gettysburg for attorney's fees under 11 U.S.C. § 506(b). The debtors and the United States Trustee have filed objections.
Section 506(b) of the Bankruptcy Code allows an oversecured creditor to add reasonable fees, among other things, to the value of its claim if the agreement under which the claim arose so provides. Thus, the bank has to meet a three-part test before it is entitled to add attorney's fees to its claim: (1) prove that it is oversecured in excess of the attorney's fees requested; (2) prove that its fees are reasonable; and (3) prove that the agreement underlying the claim provides for attorney's fees. Matter of Elmwood Farm, Inc., 19 B.R. 338 (Bkrtcy.S.D.N.Y.1982); In re LHD Realty Corp., 20 B.R. 722 (Bkrtcy.S.D.Ind. 1982); In re Masnorth Corp., 28 B.R. 892 (Bkrtcy.N.D.Ga.1983); In re Rutherford, 28 B.R. 899 (Bkrtcy.N.D.Ill.1983).
The debtors concede that the bank is oversecured in excess of the $2,693.27 requested by the bank for attorney's fees. The bank's trial exhibit No. 2 itemizes its request for attorney's fees. The Court has reviewed exhibit No. 2 and finds the fees reasonable. The bank's trial exhibit No. 1, the security agreement underlying its claim against the debtors, clearly provides for attorney's fees in paragraph No. 11: "Borrower agrees, in the event of Default . . . to pay all costs of the Bank, including reasonable attorneys' fees, in the collection of any of the Secured Obligations and the enforcement of any of the Bank's rights."
It is axiomatic that federal law, not state laws, determines whether attorney's fees are allowable under 11 U.S.C. § 506(b). The cases supporting this rule are legion. In re American Metals Corp., 31 B.R. 229, 234 (Bkrtcy.D.Kan.1983). Consequently, the Court finds no merit in the debtors' contention that the bank's attorney's fees may be objectionable under state law. Based on the foregoing analysis, the objections are overruled and the bank's application for attorney's fees is granted.
This Memorandum Decision constitutes the Court's Findings of Fact and Conclusions *835 of Law in the above-entitled matter pursuant to Bankr.R.P. 7052 and 9014 and F.R.Civ.P. 52. Counsel for the bank is directed to submit a proposed Order and Judgment, consistent with the Court's Findings of Fact and Conclusions of Law, in accordance with Bankr.R.P. 9021, to the Clerk of this Court forthwith. The proposed Order and Judgment should clearly provide that the bank's attorney's fees are added to its secured claim, not treated as an administrative expense under 11 U.S.C. § 503. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603277/ | 418 F.Supp. 311 (1976)
UNITED STATES of America, Plaintiff,
v.
COMMODORE CLUB, INC., et al., Defendants.
Crim. No. 5-80037.
United States District Court, E. D. Michigan, S. D.
April 27, 1976.
*312 Harold Z. Gurewitz, Asst. U. S. Atty., Detroit, Mich., for plaintiff.
*313 Raymond A. Ballard, Detroit, Mich., for defendants.
OPINION OF THE COURT
PHILIP PRATT, District Judge.
I.
PROCEDURAL BACKGROUND
This case was brought as a criminal prosecution against the named corporate and individual defendants on an indictment charging them with violating § 403 of the Rivers and Harbors Act of 1899,[1] which is punishable as a misdemeanor under § 406 of that Act. Section 403 states, in part:
"The creation of any obstruction not affirmatively authorized by Congress, to the navigable capacity of any waters of the United States is prohibited; . . . and it shall not be lawful to excavate or fill, or in any manner to alter or modify the course, location, condition, or capacity of, any . . . haven, harbor, canal, lake . . . or of the channel of any navigable water of the United States, unless the work has been recommended by the Chief of Engineers and authorized by the Secretary of the Army prior to beginning the same."
On stipulation by the parties this case was tried to the Court without a jury. At the close of the Government's case the defense moved for a verdict of acquittal as to Mr. Jack Clark, Vice President of Commodore Club, on the ground that the Government had not established a prima facie case against that defendant. After oral argument and consideration of the evidence adduced by the Government the Court granted the defense motion as to Mr. Clark. It denied a similar motion as to Mr. Gilmore and the defense proceeded with their case. Oral argument was heard at a later date after close of the proofs.
As a criminal prosecution it was the Government's burden to prove the three elements of a § 403 violation beyond a reasonable doubt. The three elements here are (1) that defendants caused a fill to occur (2) in navigable waters of the United States (3) without prior authorization (by permit) by the Army Corps of Engineers. The Government maintains that the evidence proves all three elements beyond a reasonable doubt. The defense argues that the Government failed to meet its burden of proof as to the second and third elements. Additionally there is present the issue of whether intent or scienter is also an element that must be proved. The following are the findings of this Court.
II.
THE PROPERTY IN QUESTION
The criminal charge is based on certain fill and reclamation activities conducted on property, owned by the defendant corporation, which is located adjacent to Lake St. Clair in Harrison Township, Macomb County, Michigan.[2] The property is adjacent to and southeasterly of Selfridge Air Force Base. It comprises approximately 66 acres.
It would appear that the general area in question prior to the earliest recorded time was marshland, kept wet by periodic overflows from Lake St. Clair, but not subject to extensive flooding during normal high waters.[3] The earliest recorded use of the property dates from 1910, when the owner of the entire area (which now encompasses the land in question and the Blue Lagoon Marina property), a Mr. Schweikart, dredged ditches around the periphery, with an outlet into Lake St. Clair and converted the marshland into a carp farm.[4] The ditches were apparently used to maintain a controlled minimal level of water on the *314 property to carry on the carp business. Aerial photographs taken in 1935, 1938 and 1940[5] disclose a definitive tree-lined bank on the lake side of the north ditch with no breaks except where the ditch inlet was dug. It would thus appear that for most of the first half of this century this inundated parcel was separated from Lake St. Clair and not part of that lake.[6]
The land was apparently unused for several decades, having changed ownership in the 1940's. In 1954 initial inquiries were made as to the feasibility of building a marina in this area. Studies and investigations continued until 1960 when the Conger Bay Development Company began to build Blue Lagoon Marina in the easterly portion of the old Schweikart property.
The westerly portion, now in dispute, remained unimproved. Comparison of aerial photographs taken in 1961[7] and 1964[8] indicate that the lake was beginning to take its toll on the separating ridge of land.[9] The ridge of trees still existed but was noticeably thinned out from erosive attrition. High waters in the late 1950's had apparently breached the ridge as revealed in the 1961 photograph but these waters had either receded or the land had been built up so that it was again a continuous stretch of land, dividing the 66 acres[10] from the lake.
Jack Clark testified that in 1968 during negotiations for the purchase of the Blue Lagoon properties he and the former owner drove back and forth over the sand bar (all that was left of the ridge of trees) inspecting the property, and that at that time the bar still divided the 66 acres from the lake. He also testified that he was subsequently required to remove fallen trees in the area and had heavy machinery in the area for that purpose.
Only after the historic flooding of 1973 and 1974 did the barrier finally give way. Although there apparently had been periodic flooding from Lake St. Clair (and for that matter the Great Lakes generally) several times this century, the flooding, which began in 1972, reached its peak in 1973 and continued at high levels through 1974, broke all previous records.[11] Venice Shores and many other areas along the western side of Lake St. Clair had flooded-out streets and homes. The Army Corps was set to work for months building protective dikes to protect property.
The flooding drastically altered the character of the Commodore Club property (the 66 acres). The high waters of the lake decimated the sand bar ridge and with that barrier removed, those acres were inundated with the flood waters, as were other *315 adjacent properties. Such was the condition of the land when the defendants filed their permit application in 1973.[12]
III.
THE PERMIT APPLICATION
Mr. Gilmore purchased the Blue Lagoon Marina and the adjoining 55-acre tract in 1970. The 11-acre tract was purchased in 1972.[13] Originally it was Jack Clark's idea, as President of Blue Lagoon Sales, Inc., to expand the marina east onto the 55-acre tract. However, it was subsequently decided that a new corporation, Commodore Club Apartments, Inc., would be organized to construct residential units on the 66 acres. The plan called for dredging of new canals and a channel into Lake St. Clair, closing of the existing north-south canal, filling and the creation of a man-made lagoon on the property. Thereafter the defendants decided a permit from the Army Corps of Engineers was required and an application was submitted by Professional Engineering Associates on behalf of Commodore Club Apartments, Inc. for a permit to implement their plan, on February 15, 1973.[14]
On March 15, 1973, as required by the applicable federal regulations,[15] the Corps promulgated and distributed a public notice[16] regarding the proposed project. That notice gave all interested parties 30 days to voice any objections or comments in writing to the proposed project.
Yet on April 12, 1973 the Corps sent Mr. Gilmore two draft permits for Gilmore's signature and return.[17] This was three days before the expiry of the comment period stated on the notice.
The cover letter accompanying the draft permit warns the applicant that "if the inclosed permits are not signed and returned within 30 days, this application will be suspended."[18] It was the testimony of Mr. Ottenbaker, then Chief of the Permit Section, that these draft permits were never returned to the Corps. Yet Mr. Gilmore also testified quite adamantly, that he signed the permits upon receipt and returned them (after making a copy of the permit for his records).[19] Considering the importance of the permit to completion of the project the Court accepts the defendant's assertion that he did sign and mail the permits back to the Corps.[20]
According to Mr. Gilmore after he sent the permits back nothing happened for 30 days, so he telephoned the Corps' office in Detroit. He was told that they had not received the permit and had no authority to send him a duplicate. It would appear that the Corps took no further action on processing his permit for several weeks. In June it requested additional information for the Fish and Wildlife Service which was provided.
Mr. Gilmore continued making preparations throughout the summer and fall of 1973, e. g., obtaining a permit for the work *316 from the Michigan Department of Natural Resources on September 25, 1973[21] and from local authorities.
In January, 1974, nine months after the public notice was issued, the Fish and Wildlife Services responded to the notice by letter to the Corps.[22] In the letter the Service stated that the proposed project area was a valuable "environmental area," that the fill would result in a loss of waterfowl nesting and fish spawning areas and recommended that the permit should be denied. The Corps forwarded a copy of that letter to Mr. Gilmore, and requested that he (1) contact the Department of the Interior to resolve the problem and (2) provide an environmental impact statement for the area.[23] Negotiations continued through the spring and correspondence reveals that as of June, 1974 the Fish and Wildlife Service was willing to consider a revised plan.[24] Shortly thereafter a Corps investigation uncovered fill activity at the site and the Corps issued a stop order on all project activity.[25]
IV.
THE FILLS
Land fills of three areas are in question in this case: (1) a fill in the 55-acre area (2) a fill in the 11-acre rectangular tract and (3) a fill in the east-west ditch south of the 11-acre tract. The Government relied on these fills to prove its case. Neither party denied that these areas were filled. Moreover, the defendants admitted responsibility for the latter two fills. They also admitted that they were responsible for some of the fill of the 55-acre tract although there was also uncontroverted testimony that unauthorized truckers had dumped land fill material in that area.
The timing of these fills, however, can only be approximated. They clearly occurred over a period of several months. The Court can only determine with certainty that the 55-acre fill was completed by September 5, 1974,[26] that the southern canal was breached and filled shortly before July 1, 1974[27] and there were continued filling activities in the 11-acre tract between October and December, 1974[28] in the southern half of that tract.
V.
DEFENSE OF ESTOPPEL
The defendants argue that the Corps is estopped from proceeding against them because it issued a "de facto" permit to them. By "de facto" they refer to the April 12 draft permits which were sent to Mr. Gilmore. While the defendants raise this equitable defense they cite no authority under which it constitutes an affirmative defense to a criminal violation of the Rivers and Harbors Act.
If this were brought as an equitable action by the Corps for injunctive relief, this defense would necessarily deserve considerable attention. Under the interim regulations which became effective May 10, 1973,[29] (and presumably even under the vague standards of the prior regulations) sending an applicant the draft permit for his signature and return is a "final decision" on the merits of the proposed project[30] which should only be made after filing of notice,[31] receipt of comments from the affected agencies[32] after a suitable response *317 time up to 75 days,[33] and a determination of "whether or not [sic] an environmental impact statement is necessary;"[34] only then "[a]fter all above actions have been completed [will the] District Engineer . . . determine in accordance with the record and applicable regulations whether or not the permit will be issued"[35] (i. e., make a "final decision").
It is clear from the exhibits and testimony that these procedures were not followed by the Corps as required. At least one example of their failure to follow their own regulations is found in the Corps' letter of June 12, 1973.[36] In that letter it is stated that "in response to our public notice the Federal Fish and Wildlife Services requested additional information relative to your proposed application on behalf of Commondore Club." The Fish and Wildlife Act of 1956[37] requires the Corps to consult with the Fish and Wildlife Service prior to issuing a permit where wildlife resources might be affected. Yet it was two months prior to that June 12 letter that the Corps issued the draft permits.
Although there was testimony to the contrary, it would appear from the plain language of the regulations that the signature act of the District Engineer is purely ministerial. It states in part:
"If the final decision is to issue the permit, the issuing official will forward two copies of the draft to the applicant for signature accepting the conditions of the permit."[38] (Emphasis added).
Clearly if the agency's decision is a final one, no further considerations are required. The execution by signing is thus a formality, a necessary one, perhaps, but still a formality.[39]
Yet in this instance all of the prerequisites to a final decisionconsideration of comments, receipt of an EIS, completion of comment periodall occurred after the draft permits had been sent to Mr. Gilmore.
Thus a "clean hands" defense to an injunctive action might have considerable merit. (Indeed the numerous failures of the Corps to adhere to its own regulations supply a good rationale for any attempt at "self-help" by the defendants.) But this is not an equitable action; rather it is a criminal one. And under the Rivers and Harbors Act one has committed a misdemeanor if he fills navigable waters without a "valid permit," which the regulations construe as one signed by the Secretary of the Army or his nominee. No permit here was so signed and the Government, therefore, did prove this element of the offense.
VI.
JURISDICTION OF THE CORPS OVER THE FILLS
The defendants next challenge the jurisdiction of the Corps over the areas that were filled. Specifically, they contend that the area in question was fast land not within the scope of the Corps' regulatory power over "navigable waters." At a minimum, they argue, the Government has not proven "beyond a reasonable doubt" that this area was part of "navigable waters."
A.
The Government initially contends that the filled areas are within the jurisdiction of the Corps because the defendants in submitting their permit application submitted to the Corps jurisdiction over all of the land encompassed by the proposed project. The Court rejects this proposition as an unfounded and overreaching generalization. *318 Simply because a person submits a permit application for a proposed project does not mean that all proposed activities connected with that project are within the Corps permit jurisdiction. The litigation at bar is a good case in point. The defendants' project included land fill, channeling, dredging and bulkhead construction activities. The canal dredging, channeling and bulkhead activities clearly required a permit; however, that does not necessarily lead to the conclusion that the land fill activities were within the Corps regulatory scope. An applicant will necessarily disclose his entire proposed plan in his permit application but the Corps cannot reasonably construe from that a subjugation to Corps regulation over any or all project actions.
The Court therefore believes that at least in a criminal prosecution such as the one presently before the Court, the prosecution must affirmatively show beyond a reasonable doubt that the area filled was part of a "navigable water" within the meaning of the statute.
B.
In its attempt to meet that burden the Government introduced testimony and exhibits to show that the area filled was (1) submerged and (2) had a bottom elevation below the ordinary high water mark (OHWM).[40] The Government adduced testimony that for Lake St. Clair the OHWM was 575.7 feet elevation above mean sea level at Father Point, Quebec.[41]
With respect to the 55-acre tract the Government proved that a survey crew was sent to the Commodore Club area on October 7 and 11, 1974, and that the submerged areas had a bottom elevation under 575.7.[42] However, that survey was conducted at least several weeks after the last fill operations in the 55-acre tract were terminated. The survey by necessity could not indicate after the fact what the bottom elevation of the filled area was. Although the bottom contour is essentially flat and in a civil context one might presume the filled area to have previously been that low, this Court will not entertain such a presumption in a criminal prosecution. The Government was required to prove beyond a reasonable doubt that the filled area had previously been under 571.7 feet in elevation and this it failed to do.
With respect to the east-west "canal" south of the 11-acre tract the evidence disclosed that this was originally part of the old Schweikart irrigation ditch around the carp farm. No testimony or evidence was introduced to show that it was widened or deepened into a true canal. There was conflicting testimony as to the ability of any boat to navigate through it. While a canal connected to other navigable waters may also be deemed navigable, a trough which is little more than an irrigation ditch is not. The Court is not convinced beyond a reasonable doubt that that section of the old ditch had been improved into a true canal and accordingly that fill also fails to prove the Government's case.
The fill in the 11-acre tract, however, presents a different problem. While the most southerly part of the fill was made prior to the October survey and presents proof problems similar to those in the 55-acre fill, the northerly portion of the fill was completed after the survey and the survey clearly shows that the bottom was lower than the ordinary high water mark.
*319 The defendants' affirmative defense to this fill was that it had been verbally authorized by Corps employees. Conflicting testimony was presented in this regard. Mr. Clark testified that Mr. Barno and Mr. Kimball of the Corps' office had indicated "that they were not concerned with the 11-acre area" when they inspected the site in July, 1974, and that based on those oral assurances he allowed the filling activity on the 11-acre tract to continue until he was ordered to stop by Mr. Gilmore. Mr. Barno denied that he had said the Corps was "not concerned" with that tract.
The Court finds that whatever words were spoken, Mr. Clark believed in good faith that he could proceed with the 11-acre fill. The Court must, therefore, address the question whether the Government must prove defendants' intent to commit a criminal offense under the Rivers and Harbors Act.
VII.
THE "SCIENTER" REQUIREMENT
It is the Government's position that § 403 is a malum prohibitum statute and does not require proof of scienter or intent. The defendants on the other hand assert that specific intent must be proven.
The Court is not persuaded by the analysis in U.S. v. Interlake Steel Corporation, 297 F.Supp. 912 (N.D.Ill.1969) which is cited by the Government. In that case the district court, on a motion to dismiss, held that since Section 13[43] of the Rivers and Harbors Act is a malum prohibitum statute carrying no explicit reference to a scienter requirement, it is not an element of an offense under that provision. While such an analysis has some appeal, it ignores the proscription on similar interpretations of statutory offenses declared in Morissette v. United States, 342 U.S. 246, 72 S.Ct. 240, 96 L.Ed. 288 (1952).
In Morissette, the Supreme Court reversed the decision of lower courts which had dispensed with the element of criminal intent under 18 U.S.C. § 641. In so holding, the Court, through Justice Jackson, thoroughly discussed the relationship between the element of criminal intent and statutory offenses. It pointed out that:
"The contention that an injury can amount to a crime only when inflicted by intention is no provincial or transient notion. It is universal and persistent in mature systems of law as belief in freedom of the human will and a consequent ability and duty of the normal individual to choose between good and evil."[44]
The Court continued:
"Crime, as a compound concept, generally constituted only from concurrence of an evil-meaning mind with an evil-doing hand, was congenial to an intense individualism and took deep and early root in American soil. As the states codified the common law of crimes, even if their enactments were silent on the subject, their courts assumed that the omission did not signify disapproval of the principle but merely recognized that intent was so inherent in the idea of the offense that it required no statutory affirmation."
The Court in Morissette went on to distinguish between codified common law crimes (which it interpreted 18 U.S.C. § 641 to be) and newly defined statutory offenses enacted as "health and welfare" measures,[45] holding that the former do require proof of scienter even if the latter may not necessarily require it.
However, this distinction between common law codifications and new statutory "public welfare offenses" while compelling is not necessarily conclusive. The Court in Morissette suggested that courts should:
"more explicitly . . . relate abandonment of the ingredient of intent, not merely with considerations of expediency *320 in obtaining convictions, nor with the malum prohibitum classification of the crime, but with the peculiar nature and quality of the offense."[46] (Emphasis added).
Thus, the Supreme Court, in making the distinction, emphasized that:
"Neither this Court nor, so far as we are aware, any other has undertaken to delineate a precise line or set forth comprehensive criteria for distinguishing between crimes that require a mental element and crimes that do not. We attempt no closed definition, for the law on the subject is neither settled nor static."[47]
This Court does not believe that the lack of explicit words of scienter from § 403 compels the deduction that no scienter element is required. If an offense carries a requirement of specific intent, proper words of scienter must be found in the statute; however, scienter may be that of general intent and it is common for codified common law and statutory offenses requiring general intent to omit reference to that element. Therefore this Court believes that in accordance with Morissette, supra, it must examine the nature and quality of the act to see if a general intent requirement is justified.
An inquiry into the legislative history of the Rivers and Harbors Act of 1899 would be unavailing, but the case law certainly reflects a trend of expanding federal jurisdiction under the Act. Early prosecutions under the Act were generally restricted to true obstructions to navigation and there were few challenges to the Corps' jurisdiction over waters which were clearly navigable.
But over the years the courts have expanded the concepts of "creating obstructions to navigable capacity" and of "modifications[48] . . . to the condition or capacity" of navigable waters. For example, in a recent and radical foray, the Fifth Circuit has held that activities which occur shoreward of and above the mean high tide line may be within the prohibitions of the Rivers and Harbors Act. U.S. v. Sexton Cove Estates, 526 F.2d 1293 (5th Cir. 1976). See also U.S. v. Perma Paving Co., 332 F.2d 754 (2d Cir. 1964). The Court of Appeals in Sexton Cove, supra, stated:
"There is no suggestion (in § 403) that an obstruction whose source is above MHTL escapes prosecution. . . . It prohibits the alteration or modification of the course, condition, location or capacity of a navigable water. There is not the slightest intimation that an alteration or modification whose source is above MHTL is any less an alteration or modification."[49]
See also Weiszmann v. U.S. Corps of Engineers, 526 F.2d 1302 (5th Cir. 1976); U.S. v. Moretti, 526 F.2d 1306 (5th Cir. 1976).
The ultimate impact of these cases (assuming for the moment that they are accepted as a correct position of the law) is that activities by owners on what is clearly fast land could be brought within the Corps' jurisdiction and could constitute the basis of a criminal prosecution resulting in fines of up to $2,500 and one year imprisonment. Yet the activity may have occurred on what no one, including the defendant, would deem to be "navigable water."
Considering the relatively stringent criminal penalties imposed, the serious consequences of a criminal conviction, the vagaries of the scope of the Corps' jurisdiction under the Act and the fact that effective remedies can be achieved through injunctive action against offending parties, this Court believes that general intent to violate the Act must be established as a prerequisite to criminal conviction under § 403 and § 406 of the Rivers and Harbors Act.
*321 In this case the evidence of even a general intent to violate the Act by filling the 11-acre tract was equivocal at best. The Government did not prove that element beyond a reasonable doubt and thus failed to establish their case against the defendants.
The history of the 11-acre parcel, known as it was by defendants, is a factor in the issue of intent, although it also has significance in the following discussion regarding "fast land." As has been mentioned, the 11-acre parcel was owned by the United States, and it was sold by the General Services Administration to defendants' predecessor in title shortly before the events in issue here. The Government's offering for bids described it as suitable for building purposes, including industrial use and described it as including a "roadway" easement from North Shore Drive to the parcel. The Government sale was for approximately $55,000 and defendants purchased it for approximately $155,000substantial amounts for land that the plaintiff now claims was an extension of Lake St. Clair. At any rate, it cannot be gainsaid that defendants were illogical or unjustified in believing that the Corps did not claim jurisdiction over the parcel.
VIII.
THE LAND-WATER DICHOTOMY
Although the Court believes that sufficient reasons are given above to require dismissal of these charges, consideration should be given to the defendants' contention that the area in question must be treated as land rather than as the natural extension of the navigable waters of Lake St. Clair and therefore the Corps has no jurisdiction over the areas filled. The issue, in the context of a criminal prosecution, is more properly phrased as follows: has the Government proven beyond a reasonable doubt that the area in question was part of Lake St. Clair and therefore "navigable" under the statute, and not merely temporarily inundated "fast land?"
The pertinent findings of fact on this issue, recited above, can be summarized as follows:
1. Topographically the area including the 55-acre and 11-acre tracts has always been designated as "land."
2. From 1910 to at least 1970 there existed a distinct barrier of land which separated these tracts from Lake St. Clair.
3. This barrier was finally washed away and the tract totally inundated by the record flooding of Lake St. Clair occurring during 1973 and 1974.
The Government's reliance on the fact that in 1973 and 1974 these lands were covered with waters from Lake St. Clair is too simplistic for the Court to accept unhesitantingly. The Government argues that once the waters of a navigable lake extend over an area, if that area is below the ordinary high water mark, then the Corps can assert jurisdiction. If this were generally so, then many low lying areas in Harrison Township which were flooded in 1973-1974 would now be subject to the Corps' dictates. That which was normally and historically land would now be "navigable water" by regulatory fiat.
The question of the legal effect of changes on land by natural forces was considered in Philadelphia Company v. Stimson, 223 U.S. 605, 32 S.Ct. 340, 56 L.Ed. 570 (1912) and in that case the Supreme Court laid down certain guiding principles. The Court there stated:
"It is the established rule that a riparian proprietor of land bounded by a stream, the banks of which are changed by the gradual and imperceptible process of accretion or erosion, continues to hold to the stream as his boundary; if his land is increased he is not accountable for the gain, and if it is diminished he has no recourse for the loss. But where a stream suddenly and perceptibly abandons its old channel, the title is not affected and the boundary remains at the former line."[50]
*322 This has been the classic test: if erosion or accretion, the boundary changes; but if the natural forces result in avulsion, the boundary remains as before.
The Supreme Court in Stimson, supra, affirmed the rule formulated in County of St. Clair v. Lovingston, 90 U.S. (23 Wall) 46, 50, 66-69, 23 L.Ed. 59 (1874), that:
"The test as to what is gradual and imperceptible in the sense of the rule is, that though the witnesses may see from time to time that progress has been made, they could not perceive it while the process was going on."
Although these cases dealt with the effects of nature on rivers and streams, there is no reason why riparian rights of lakefront owners should not be treated similarly. That no case involving lakeshore rights was cited only suggests that these natural forces do not normally affect lake riparian property.
But the floods of 1973-1974 were not normal. The waters continued to rise and inundated the lands breaking all recorded lake levels. Large quantities of soil were washed into the Lake; the Corps itself worked overtime constructing dikes and earthenworks to protect property owners.
Unlike other owners, Commodore Club did not take action to protect its ridge of land which had separated the 66 acres from the lake, and as a consequence it was washed away into the lake and the acreage was flooded. Certainly some erosion had occurred prior to 1970, but the separating ridge still existed then. It took the storms and flooding of a two-year historical cycle to wash the barrier ridge away. Erosion or avulsion?
Because this is a criminal prosecution this Court does not have to conclusively find one condition or the other. For if avulsion, then the parties should be allowed to reclaim what once was land and not a lateral extension of Lake St. Clair. It was the prosecution's burden to prove beyond a reasonable doubt that, solely because of erosion, this area was part of Lake St. Clair. This Court does have a reasonable doubt, for the possibility that this was an avulsive force cannot be totally discounted.[51]
The foregoing findings cannot be completed without the caveat that the case is presented to the Court in the criminal context. It is not redundant, then, to emphasize that its findings are necessarily grounded on the standard of proof which attaches to criminal cases, that of "beyond a reasonable doubt." It is the failure of the Government to carry its burden in respect to the essential elements of the offense charged in this indictment, concerning this land, that is the fatal flaw.
For those reasons given above this Court does find the defendants Commodore Club Apartments, Inc. and William Gilmore, President, not guilty of a violation of § 403 of the Rivers and Harbors Act. The charges are hereby dismissed.
IT IS SO ORDERED.
EXHIBIT A to follow *323
NOTES
[1] 33 U.S.C. § 403.
[2] See Exhibit A attached hereto.
[3] Other adjacent areas, including parts of what is now Venice Shores, were "swampy" but the general practice in many such areas was to pump out the water and use the property as farmland. Testimony of Ralph E. Beaufait, a life-long resident and former Township Clerk of Harrison Township.
[4] Testimony of Ralph E. Beaufait.
[5] Defendants' Exhibits W, X and Y, respectively.
[6] The testimony of Mogens C. Nielsen of the Michigan Department of Natural Resources was particularly illuminating and impressive as to this finding. As a result of the passage of the Submerged Lands Act, No. 247, Public Acts of 1955, as amended, M.C.L.A. § 322.701 et seq., Mr. Nielsen conducted effective and searching inquiry into the lakeshores of the State of Michigan and was able to produce aerial photographs, maps and other documentary evidence which had significant probative value.
[7] Defendants' Exhibit J.
[8] Defendants' Exhibit O.
[9] No photographs of the area from 1940 to 1960 were introduced. However, Mr. Mogens C. Nielsen, now Chief of the Submerged Lands Management Division of the Michigan Department of Natural Resources testified that while employed with D.N.R. he first inspected this property in 1958 and 1959, examined the shoreline and determined that the parcel should be considered "upland."
[10] Some time prior to 1960 the Government had purchased an 11-acre rectangular parcel of the Schweikart property across the north-south drainage ditch from Selfridge Air Field. When Blue Lagoon was built one condition imposed by the township was that the owners expand the east-west ditch and dredge a new north-south canal to the lake, for residents of the new Venice Shores development. As the Government owned the portions of the drainage ditch adjacent to the 11-acre parcel (to the west and south) the owners of Blue Lagoon had to dig a new north-south canal to the east of the 11-acre parcel. Thus the undeveloped 66 acres became divided into the 11-acre parcel and the 55-acre parcel (so designated hereafter).
[11] Defendants' Exhibit HH.
[12] Plaintiff's Exhibit 4.
[13] Testimony of Mr. Gilmore.
[14] Plaintiff's Exhibit 4.
[15] 33 C.F.R. § 209.120(f)(1) (1972). The 1972 regulations remained in effect until May 10, 1973, when the Department of the Army published proposed regulations which superceded those in 33 C.F.R. § 209.120 and served as interim guidance to all Corps installations. Those proposed regulations became final and took effect as final regulations on April 3, 1974. Federal Register, Vol. 39, No. 65, p. 12115 (April 3, 1974). The applicable sections of the proposed regulations were not modified and are currently as stated in 33 C.F.R. § 209.120 (1975).
[16] Plaintiff's Exhibit 6.
[17] Plaintiff's Exhibit 11.
[18] Id.
[19] Defendant's Exhibit Q.
[20] A draft permit signed and dated October 5, 1973 by Mr. Gilmore was introduced with plaintiff's Exhibit 11. It is unclear when and under what circumstances this permit was signed. Defendant's Exhibit Q, the xeroxed copy retained by Mr. Gilmore appears to be a xerox of an original, while the copy dated October 5, 1973 is a carbon copy. The signed carbon copy was retained by the Corps after October 5, 1973.
[21] Defendant's Exhibit BB.
[22] Plaintiff's Exhibit 14.
[23] Plaintiff's Exhibit 15.
[24] Plaintiff's Exhibit 20.
[25] Plaintiff's Exhibit 31.
[26] Plaintiff's Exhibits 32, 38.
[27] Plaintiff's Exhibits 23, 24.
[28] Plaintiff's Exhibit 38 and testimony of Walter Bruno.
[29] Federal Register, Vol. 39, No. 65, p. 12115 (April 3, 1974).
[30] 33 C.F.R. § 209.120(i)(1)(vii).
[31] 33 C.F.R. § 209.120(i)(1)(ii).
[32] 33 C.F.R. § 209.120(i)(1)(iii).
[33] 33 C.F.R. § 209.120(i)(3)(ii).
[34] 33 C.F.R. § 209.120(i)(1)(iv). The Court notes that no environmental impact statement (EIS) was made on this project before the sending of the draft permit.
[35] 33 C.F.R. § 209.120(i)(1)(vi).
[36] Plaintiff's Exhibit 12.
[37] 16 U.S.C. §§ 742a-742j.
[38] 33 C.F.R. § 209.120(i)(1)(vii) (1975).
[39] Even Mr. Ottenbaker on cross-examination admitted that normally if the permit is signed and returned, the Corps will execute it as a matter of course.
[40] 33 C.F.R. § 209.260 (1975) defines the Corps' jurisdiction to "extend laterally to the entire water surface and bed of a navigable water body, which includes all land and waters below the ordinary high water mark."
[41] However, the Government was totally unable to explain how it arrived at this figure except to say that "historically" it used this figure, which is four feet higher than the Low Water Datum (LWD) of 571.7 feet.
[42] Plaintiff's Exhibit 46. The defendants challenged the accuracy of these results, citing possible fluctuations and variances of LWD readings on which the results are based. However, the Court finds that the survey was taken by the most reliable means known and accepts these figures as valid allowing possible variance of six inches either higher or lower.
[43] 33 U.S.C. § 407, which prohibits the dumping of refuse or waste materials into navigable waters.
[44] 342 U.S. at 250, 72 S.Ct. at 243.
[45] See U.S. v. Behrman, 258 U.S. 280, 42 S.Ct. 303, 66 L.Ed. 619 and U.S. v. Balint, 258 U.S. 250, 42 S.Ct. 301, 66 L.Ed. 604.
[46] 342 U.S. at 259, 72 S.Ct. at 248.
[47] 342 U.S. at 260, 72 S.Ct. at 248.
[48] The Court notes that under Zabel v. Tabb, 430 F.2d 199 (5th Cir. 1970), cert. denied 401 U.S. 910, 91 S.Ct. 873, 27 L.Ed.2d 808 (1971) a "modification" may be a change in environmental as well as navigable conditions.
[49] 526 F.2d at 1298.
[50] 233 U.S. at 624, 32 S.Ct. at 346.
[51] 33 C.F.R. 209.3601 reads in part:
"(1) Geographic limits: Shifting boundaries. Permanent changes of the shoreline configuration result in similar alterations of the boundaries of the navigable water. Thus, gradual changes which are due to natural causes and are perceptible only over some periods of time constitute changes in the bed of a water body which also change the shoreline. However, an area will remain `navigable in law,' even though no longer covered with water, whenever the change has occurred suddenly, or was caused by artificial forces intended to produce that change."
This Court does infer from this policy statement "that where there is a sudden washout, from a storm for example, the mean high water mark remains unchanged and a riparian owner may take remedial action in an area theretofore above the mean high water mark without securing a permit." See U.S. v. Cannon, 363 F.Supp. 1045, 1052 (D.Del.1973). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603308/ | 786 N.W.2d 873 (2010)
STATE
v.
PALMER.
No. 09-0994.
Court of Appeals of Iowa.
June 16, 2010.
Decision Without Published Opinion Sentence Vacated and Remanded. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/285293/ | 412 F.2d 189
Raymond S. BERRY, Appellant,v.UNITED STATES of America.
No. 17467.
United States Court of Appeals Third Circuit.
Argued March 24, 1969.
Decided May 28, 1969.
Edward Mannino, Dilworth, Paxson, Kalish, Kohn & Levy, Philadelphia, Pa., for appellant.
Jerome R. Richter, Asst. U. S. Atty., Philadelphia, Pa. (Drew J. T. O'Keefe, U. S. Atty., Philadelphia, Pa., on the brief), for appellee.
Before SEITZ, ALDISERT and STAHL, Circuit Judges.
OPINION OF THE COURT
ALDISERT, Circuit Judge.
1
The appellant pleaded guilty to the illegal sale of narcotic drugs in violation of 21 U.S.C.A. § 174 and was sentenced to fifteen years imprisonment. Under the provisions of Section 7237 of Title 26, he was not eligible for parole because of previous violations of the narcotics laws.1 He was not advised of this ineligibility prior to entering the plea. This case requires us to decide whether the failure to so advise him vitiates the plea.
2
The reception of the plea took place in 1962, before the 1966 amendments to Federal Criminal Rule 11 which added the requirement that a guilty plea be entered with an understanding of its "consequences".2 The court below correctly concluded that the addition of this requirement was merely an explicit restatement of existing law and practice and that "the failure to advise a defendant in 1962 of his ineligibility for parole is equatable with a violation of Rule 11 after 1966."3
3
Following an evidentiary hearing,4 the district court determined that the defendant had not been advised of this ineligibility and "may have believed that he would be eligible for parole." Nevertheless, the court concluded that no prejudice had been sustained by this omission and denied relief.5
4
After oral argument of the appeal before this Court, the Supreme Court held in McCarthy v. United States, 394 U.S. 459, 89 S.Ct. 1166, 22 L.Ed.2d 418 (April 2, 1969), that non-compliance with Rule 11 in accepting a guilty plea vitiates the plea and necessitates the opportunity to plead anew — thus adopting the "automatic prejudice" rule of Heiden v. United States, 353 F.2d 53 (9 Cir. 1965). In so doing, the Supreme Court rejected this Court's holdings in Miller v. United States, 356 F.2d 515 (3 Cir. 1966) and United States v. DelPiano, 386 F.2d 436 (3 Cir. 1967) that non-compliance with Rule 11 "does not per se require a vacation of sentence and plea. The inquiry is whether the plea was in fact voluntary." 386 F.2d at 437.6 It was the teaching of DelPiano and Miller which led the district court to conclude that no relief could be granted without a showing of actual prejudice.
5
But we may not apply the McCarthy rule of "automatic prejudice" to the plea in this case which was entered on September 11, 1962. In Halliday v. United States, 394 U.S. 831, 89 S.Ct. 1498, 23 L.Ed.2d 16 (May 5, 1969), the Court stated: "[W]e decline to apply McCarthy retroactively. We hold that only those defendants whose guilty pleas were accepted after April 2, 1969, are entitled to plead anew if their plea was accepted without full compliance with Rule 11."7
6
Accordingly, it becomes necessary to examine the circumstances surrounding the enty of the plea from the viewpoint of pre-McCarthy standards. In so doing, we have concluded that the appellant's plea was not entered with a proper understanding of its consequences and must therefore be vacated. We reach this conclusion because we regard the test of prejudice applied by the district court as improper.
7
The court below concluded from its evidentiary hearing that at the time the appellant entered his plea, he was unaware that he would be ineligible for parole.8 The court reasoned, however, that this lack of knowledge was not prejudicial because the actual sentence imposed, even without the right to parole, was less than one-third of the maximum sentence which could have been given. Since federal prisoners must serve one-third of their sentence to be eligible for parole, the court concluded that no actual prejudice was incurred.
8
The court's reasoning is based on a false conception of "prejudice." Whether prejudice resulted from the entry of the guilty plea is not measured by the severity or leniency of the sentence imposed; prejudice inheres when an accused pleads guilty, thus convicting himself of a criminal offense, without understanding the significance or consequences of his action. Accordingly, our task is to determine whether it is possible for a second offender in a federal narcotics prosecution to have a complete understanding of the consequences of his plea of guilty when he is unaware that a statute precludes him from eligibility for parole.
9
The Supreme Court has consistently applied stringent standards for testing the validity of a plea of guilty. These requirements, recently reviewed by this Court in United States ex rel. Crosby v. Brierley, 404 F.2d 790 (3 Cir. 1968), emphasize that an essential ingredient of a guilty plea is that it be entered "voluntarily after proper advice and with full understanding of the consequences."9 Federal Criminal Rule 11, as constituted before its amendment in 1966, was but a restatement of this constitutional principle.
10
It is important to note, however, that not every result of a plea is a "consequence" within the meaning of Rule 11. For example, this Court held in United States v. Cariola, 323 F.2d 180 (3 Cir. 1963), that the failure of the trial court to advise a defendant of the possible loss of state voting rights as a result of conviction did not invalidate the entry of a guilty plea.
11
We are aware of the inclinations of some courts to suggest that the ineligibility for parole should be similarly categorized. In Smith v. United States, 116 U.S.App.D.C. 404, 324 F.2d 436, 441 (1963), cert. denied 376 U.S. 967, 84 S. Ct. 978, 11 L.Ed.2d 975 (1964), the court held that "eligibility for parole is not a `consequence' of a plea of guilty, but a matter of legislative grace." The same conclusion was reached in Trujillo v. United States, 377 F.2d 266 (5 Cir. 1967), cert. denied 389 U.S. 899, 88 S.Ct. 224, 19 L.Ed.2d 221.
12
Under ordinary circumstances, it should not become necessary for a trial court to include an explanation of probation or parole in its inquiry into the defendant's understanding of his plea. But the circumstances here were not ordinary. The particular status of this defendant as a narcotics recidivist brought into mechanical operation a Congressional directive severely restricting the freedom of action of not only the sentencing judge but the entire apparatus of the Board of Parole.
13
In any normal sentencing procedure in the federal courts, a sentence prescribing a number of years of imprisonment generally means that the defendant may expect to serve approximately one-third of this term with good conduct. Probation and parole are concepts which our society has come to accept as natural incidents of rehabilitation during imprisonment.
14
This is not true where, as here, because of a Congressional directive tucked away in a relatively obscure section of the Internal Revenue Code, a narcotics offender is faced with the unconditional loss of probation and parole. This loss becomes an inseparable ingredient of the punishment imposed. Its effect is so powerful that it translates the term imposed by the sentencing judge into a mandate of actual imprisonment for a period of time three times as long as that ordinarily expected.
15
The mandate of Rule 11, before and after the 1966 amendment, is designed to insure that the pleader is made aware of the outer limits of punishment. At the very least, this means that he must be apprised of the period of required incarceration. Except for capital punishment, no other consequence can be as significant to an accused as the period of possible confinement. When one enters a plea of guilty he should be told what is the worst to expect. At the plea he is entitled to no less — at sentence he should expect no more.
16
Under such circumstances, the knowledge of ineligibility for parole is as necessary to an understanding of the plea as is the knowledge of the maximum sentence possible. Failure to impart this information constituted a failure to explain to the appellant the consequences of his plea.
17
We therefore reach the same conclusion as did the Ninth Circuit in Munich v. United States, 337 F.2d 356 (1964): "[O]ne who, at the time of entering a plea of guilty, is not aware of the fact that he would not be eligible for probation or parole, does not plead with understanding of the consequences of such a plea."10
18
Accordingly, the judgment of the district court will be reversed and the case remanded with directions to vacate the judgment of conviction and sentence in order to afford the appellant a new opportunity to plead to the indictment.
Notes:
1
26 U.S.C.A. § 7237 provides that if it is the offender's second or subsequent offense, "the imposition or execution of sentence shall not be suspended, probation shall not be granted and in the case of a violation of a law relating to narcotic drugs, Section 4202 of Title 18, United States Code * * * shall not apply."
18 U.S.C.A. § 4202 states: "A Federal prisoner, other than a juvenile delinquent * * * wherever confined and serving a definite term or terms of over [one year] whose record shows that he has observed the rules of the institution in which he is confined, may be released on parole after serving one-third of such term or terms or after serving fifteen years of a life sentence."
2
The amendments to Rule 11, effective July 15, 1966, appear in italics as follows: "A defendant may plead not guilty, guilty, or with the consent of the court,nolo contendere. The court may refuse to accept a plea of guilty, and shall not accept such a plea or a plea of nolo contendere without first addressing the defendant personally and determining that the plea is made voluntarily with the understanding of the nature of the charge and the consequences of the plea. If a defendant refuses to plead or if the court refuses to accept a plea of guilty or if a defendant corporation fails to appear, the court shall enter a plea of not guilty. The court shall not enter a judgment upon a plea of guilty unless it is satisfied that there is a factual basis for the plea."
3
See the Advisory Committee's Notes, 8 Moore's Federal Practice § 11.01 and 1 Wright, Federal Practice and Procedure § 173
4
The matter came before the district court as a petition seeking relief alternatively under 28 U.S.C.A. § 2255 or Federal Criminal Rule 32(d) as a motion to withdraw a plea of guilty
5
The court's conclusion that no prejudice had been sustained was reasoned as follows: "There is no doubt that defendant knew he was subject to a maximum penalty of forty years imprisonment. Petitioner may have believed he would be eligible for parole, but he knew that parole would not be available before service of one-third of the sentence (N.T. 51). Petitioner, of course, had no right or basis to assume that less than the maximum would be imposed. And under such a sentence, parole would not have been available until he had served thirteen and one-half years imprisonment. Under the sentence imposed — fifteen years — with mandatory good time, petitioner will be released after ten years and twenty-six days." Berry v. United States, 286 F. Supp. 816, 822 (E.D.Pa.1968)
6
Similar rulings had been made by other circuits in Lane v. United States, 373 F. 2d 570 (5 Cir. 1967); United States v. Kincaid, 362 F.2d 939 (4 Cir. 1966); Bartlett v. United States, 354 F.2d 745 (8 Cir. 1966)
7
The Court declared:
"The rule we adopted in McCarthy has two purposes: (1) to insure that every defendant who pleads guilty is afforded Rule 11's procedural safeguards, which are designed to facilitate the determination of the voluntariness of his plea; (2) to provide a complete record at the time the plea is entered of the factors relevant to this determination, thereby enabling a more expeditious disposition of a post-conviction attack on the plea. Unquestionably, strict compliance with Rule 11 enhances the reliability of the voluntariness determination, and we have retroactively applied constitutionally grounded rules of criminal procedure designed to correct `serious flaws in the fact-finding process at trial.' Stovall v. Denno, supra, 388 U.S. at 298, 87 S.Ct. 1970. [18 L.Ed.2d 1199.] However, a defendant whose plea has been accepted without full compliance with Rule 11 may still resort to appropriate post-conviction remedies to attack his plea's voluntariness. Thus, if his plea was accepted prior to our decision in McCarthy, he is not without a remedy to correct constitutional defects in his conviction. Cf. Johnson v. New Jersey, supra, 384 U.S., at 730, 86 S.Ct. at 1779, [16 L. Ed.2d 882]. And as we pointed out in Stovall, the extent to which a `condemned practice infects the integrity of the truth-determining process * * * must be * * * weighed against the prior justified reliance upon the old standard and the impact of retroactivity upon the administration of justice.' Stovall v. Denno, supra, 388 U.S. at 298, 87 S.Ct. at 1970. In McCarthy we noted that the practice we were requiring had been previously followed by only one Circuit; that over 80% of all verdicts in the federal courts are obtained after guilty pleas; and that prior to Rule 11's recent amendment, not all district judges personally questioned defendants before accepting their guilty pleas. Thus, in view of the general application of Rule 11 in a manner inconsistent with our holding in McCarthy, and in view of the large number of constitutionally valid convictions that may have been obtained without full compliance with Rule 11, we decline to apply McCarthy retroactively." 394 U.S. 831 at 832, 833, 89 S.Ct. 1498 at 1499.
8
The record indicates that at the sentencing hearing which occurred approximately five weeks after the entry of the plea, there was a dialogue between the court and defense counsel during which the court remarked that "the entire sentence must be served." Although the record indicates that this statement was made in the appellant's presence, there is nothing to suggest that the appellant grasped its significance
9
Although Crosby concerned a state conviction, the principles set forth as an expression of the constitutional standards governing the reception of a guilty plea are, of course, equally applicable to the present case
10
See also Bailey v. MacDougall, 392 F. 2d 155 (4 Cir. 1968), cert. denied 393 U.S. 847, 89 S.Ct. 133, 21 L.Ed.2d 118 and Wilson v. Rose, 366 F.2d 611 (9 Cir. 1966) | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1603614/ | 8 So.3d 474 (2009)
In the Interest of T.F., a child.
T.F., Appellant,
v.
Department of Children and Family Services and Guardian ad Litem Program, Appellee.
No. 2D08-1291.
District Court of Appeal of Florida, Second District.
April 29, 2009.
*475 Jackson S. Flyte, Regional Counsel, Second District, and Robert D. Rosen, Assistant Regional Counsel, Office of Criminal Conflict and Civil Regional Counsel, Bartow, for Appellant.
Bill McCollum, Attorney General, Tallahassee, and Kelley Schaeffer, Assistant Attorney General, Tampa, for Appellee Department of Children and Family Services.
Ama N. Appiah, Orlando, for Appellee Guardian ad Litem Program.
VILLANTI, Judge.
The Mother appeals a final order adjudicating her child dependent.[1] The Department of Children and Family Services and the Guardian ad Litem Program concede that the trial court erred in its order changing the case plan goal from reunification to adoption, but they argue that the issue is moot because the Mother subsequently surrendered her parental rights to the child. We find that the issue is not moot and hold that the trial court abused its discretion by: (1) changing sua sponte the Department's initial case plan goal from reunification (concurrent with adoption through termination of parental rights) to adoption through termination of parental rights (concurrent with permanent guardianship) and ordering the Department to file a petition for termination of parental rights, (2) changing sua sponte the goal of its dependency order from reunification to adoption, and (3) failing to hold a new arraignment and obtaining the Mother's knowing and voluntary consent to the dependency petition or failing to hold an adjudicatory hearing. Accordingly, we reverse.
On November 1, 2007, the Department sheltered the nine-year-old child. On November 28, 2007, the Department filed a *476 Petition for Adjudication of Dependency, which stated that the Mother was incarcerated. The Mother, represented by counsel, appeared at the arraignment on January 15, 2008. The trial court, which was aware of the Mother's incarceration, explained to her that the dependency petition alleged abandonment, "which is just a legal term for saying you haven't been around taking care of [the child]." The trial court then told the Mother that "[t]he Court is going to give you a case plan and your attorney acknowledged you wanted to start working on that" and "if you don't do that case plan and finish the sort of things that are related to this case, then your parental rights to [the child] could be terminated altogether." (Emphasis supplied.) Following this dialogue, the Mother consented to the dependency petition. The trial court specifically approved the Mother's request to waive her appearance at the disposition hearing so that she would not miss gain time. The request to waive the Mother's appearance at the disposition hearing was based upon representations that the goal of the case plan was reunification of the Mother and child. Thereafter, the trial court adjudicated the child dependent based upon the Mother's "knowing, voluntary, and intelligent choice to[enter] into this consent to resolve this case here today." A disposition hearing was set for February 1, 2008.
Consistent with the discussions at the arraignment hearing, on January 24, 2008, the Department filed an initial case plan with a stated goal of reunification of the Mother and the child. The Mother reviewed that case plan before the disposition hearing, and therefore, she did not appear at the hearing. More important, the expiration date on the case plan was October 5, 2008. However, at the February 1, 2008, disposition hearing, the trial court questioned why the Mother had received a reunification case plan when she would be incarcerated until 2009,[2] a date after her case plan's expiration date. The Department's attorney responded: "Judge... she's not going to beher incarceration is not significant enough for herto proceed with TPR." Nevertheless, the court sua sponte stated it would not allow the Mother a reunification plan because "[i]t's just impossible[.]" The court then changed the goal from reunification to adoption, concurrent with permanent guardianship. The trial court subsequently denied the Mother's motion for rehearing and ordered the Department to file a petition for termination of parental rights. This appeal ensued.
As an initial matter, the Department and the Guardian concede that the trial court improperly changed the stated permanency goal at the disposition hearing. However, they argue that the issue is moot and that this appeal should be dismissed because the Mother subsequently signed surrenders of her parental rights to the child on August 7, 2008. We reject this contention because, as acknowledged by the parties, the Mother filed a motion to withdraw her surrenders of the child. Although her motion to withdraw the surrenders was orally denied, the trial court has not issued a written order reflecting that denial. Hence, the Mother's time to appeal the order denying her motion to withdraw the surrenders has not expired. See Fla. R.App. P. 9.020(h) (stating that an "order is rendered when a signed, written order is filed with the clerk of the lower tribunal"); Fla. R.App. P. 9.110(b) (stating that the appellate court's jurisdiction is *477 invoked by filing a notice of appeal within thirty days of rendition of the order appealed). The Mother has indicated that she may appeal the denial of her motion to withdraw the surrenders once she receives a written order. If that were the case, and if her consent to surrender the child is reversed on appeal, her current appeal would be relevant. Therefore, this issue is not moot, and we consider the appeal on the merits.
Section 39.621(2)(b), Florida Statutes (2007), allows adoption as a permanency goal option only "if a petition for termination of parental rights has been or will be filed." Here, the Department and the Guardian both concede error because a petition for termination of the Mother's parental rights was not filed. In fact, the trial court chose to second guess the Department's stated reunification goal, even though the Department stated at the disposition hearing that the Mother's incarceration was not significant enough to proceed with termination of parental rights. This clearly indicated that the Department had no intention of filing a termination petition. Based on these facts, the trial court abused its discretion by changing the goal from reunification to adoption through termination of parental rights and by ordering the Department to file a petition to terminate the Mother's parental rights.
Finally, we must point out that the trial court's actions raised serious due process issues. Florida Rule of Juvenile Procedure 8.325(c) requires the trial court to "determine that any ... consent to a finding of dependency is made voluntarily and with a full understanding of the nature of the allegations and the possible consequences of the ... consent." In this case, it is clear from the record on appeal that the Mother's consent to the dependency adjudication did not include consent to a case plan with a goal of adoption through the termination of her parental rights. At the arraignment hearing, the parties discussed reunification; adoption was never discussed with the Mother. The trial court told the Mother that she would be receiving a case plan and that her parental rights could be terminated if she did not comply with her case plan. Based on those representations, the Mother consented to the dependency adjudication without an evidentiary hearing, and she waived her appearance at the disposition hearing. The trial court's unilateral decision at the subsequent disposition hearing to change the case plan goal to adoption through termination of parental rights meant that the Mother's consent to the dependency adjudication was not knowing and voluntary. At that point, without the Mother's knowing and voluntary consent, the trial court could adjudicate the child dependent only after an adjudicatory hearing pursuant to section 39.507. See § 39.506(2). Yet, an adjudicatory hearing was not held in this case. Thus, the trial court erred under the facts of this case in addressing a substantive issue without either obtaining the Mother's knowing and voluntary consent at a new arraignment or holding an adjudicatory hearing.
Reversed and remanded for further proceedings consistent with this opinion.
WALLACE, J., and GALLEN, THOMAS M., Associate Senior Judge, Concur.
NOTES
[1] Because both the Mother's and the child's initials are "T.F." we will refer to them as "the Mother" and "the child" throughout this opinion.
[2] At the arraignment hearing, the Mother stated that she would be incarcerated until March 2009. The Predisposition Study filed with the court on January 25, 2008, stated that the Mother would be incarcerated until May 2009. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603724/ | 8 So.3d 438 (2009)
A.W. CUNNINGHAM a/k/a Wayne Cunningham, Appellant,
v.
MBNA AMERICA BANK, N.A., a National Banking corporation, Appellee.
No. 2D07-2909.
District Court of Appeal of Florida, Second District.
April 3, 2009.
*439 Debra J. Sutton and Sara-Jean Palmer of Sutton Law Firm, Bartow; Neal L. O'Toole of Lilly O'Toole & Brown LLP, Bartow, for Appellant.
Richard E. Landman and George N. Andrews of Akerman Senterfitt, Fort Lauderdale, for Appellee.
LaROSE, Judge.
A.W. Cunningham appeals the trial court's order granting MBNA America Bank, N.A.'s motion to dismiss his second amended counterclaim. Because the trial court erred in dismissing, with prejudice, two permissive claims, we reverse, in part, and remand for further proceedings.
This case has a lengthy history but can be summarized concisely. MBNA issued a credit card in Mr. Cunningham's name, but allegedly without his knowledge, to a third party, presumably his ex-wife. Some two years later, MBNA placed the account in default for nonpayment. At about that time, Mr. Cunningham learned of the unpaid *440 debt. Through counsel, he disputed liability.
MBNA tried to collect from Mr. Cunningham. Pursuant to the credit card agreement, MBNA instituted arbitration in Maryland before the National Arbitration Forum. Although he knew of these proceedings, Mr. Cunningham did not participate in the arbitration. The arbitrator entered an award of over $21,000 in favor of MBNA. Mr. Cunningham knew of the award.
MBNA filed a complaint and an amended complaint in the trial court seeking damages and domestication of the arbitration award. Essentially, MBNA sought confirmation of the award. See 9 U.S.C. § 9 (2000); § 682.12, Fla. Stat. (2001). Mr. Cunningham filed a counterclaim, twice amended, alleging violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. § 1692 (2001), the Florida Consumer Collection Practices Act (FCCPA), sections 559.55-.785, Florida Statutes (2001), and assorted claims of defamation, abuse of process, and negligence.
The trial court dismissed the counterclaim with prejudice. It ruled that the counterclaim was a disguised attempt to vacate the arbitration award and to relitigate issues that could or should have been raised in the arbitration proceedings. The trial court concluded that Mr. Cunningham had not sought to vacate the arbitration award in a timely manner under the Florida Arbitration Code. See § 682.13.[1] Apparently, the trial court did not consider the factual allegations of the counterclaim or the events giving rise to the counterclaim.
The trial court did not enter a final judgment on MBNA's main claim or otherwise confirm the arbitration award. See 9 U.S.C. § 9; § 682.12. Consequently, we must satisfy ourselves that the order before us is appealable. See Fla. R.App. P. 9.030(b). According to Mr. Cunningham, the counterclaim was permissive, making the trial court's dismissal with prejudice a final appealable order. See Fla. R.App. P. 9.030(b)(1)(A). We agree, in part. An order dismissing a permissive counterclaim is a final order subject to appeal, provided the order otherwise meets the test of finality. See Philip J. Padovano, Florida Appellate Practice § 22.4, at 450 (2009 ed.) (citing Sarasota Cloth Fabric & Foam, Inc. v. Benes, 502 So.2d 1354 (Fla. 5th DCA 1987); Campbell v. Gordon, 674 So.2d 783 (Fla. 1st DCA 1996)); see also Yunger v. Oliver, 803 So.2d 884, 888 (Fla. 5th DCA 2002) (affirming order on appeal and holding that two permissive counterclaims were properly stricken by the trial court as sham pleadings; finding three counterclaims to be compulsory counterclaims that must await an appeal from the final judgment). In contrast, the dismissal of a compulsory counterclaim, with prejudice, is not an appealable final order until a final disposition of the underlying case. See S.L.T. Warehouse Co. v. Webb, 304 So.2d 97 (Fla.1974); Johnson v. Allen, Knudsen, DeBoest, Edwards & Rhodes, P.A., 621 So.2d 507 (Fla. 2d DCA 1993).
Florida Rule of Civil Procedure 1.170 addresses the distinction between compulsory and permissive counterclaims:
(a) Compulsory Counterclaims. A pleading shall state as a counterclaim any claim which at the time of serving the pleading the pleader has against any opposing party, provided it arises out of the transaction or occurrence that is the *441 subject matter of the opposing party's claim....
(b) Permissive Counterclaim. A pleading may state as a counterclaim any claim against an opposing party not arising out of the transaction or occurrence that is the subject matter of the opposing party's claim.
Under Londono v. Turkey Creek, Inc., 609 So.2d 14, 20 (Fla.1992), the "logical relationship" test determines whether a counterclaim is compulsory:
A claim has a logical relationship to the original claim if it arises out of the same aggregate of operative facts as the original claim in two senses: (1) that the same aggregate of operative facts serves as the basis for both claims; or (2) that the aggregate core of facts upon which the original claim rests activates additional legal rights in a party defendant that would otherwise remain dormant.
Simply stated, a compulsory counterclaim arises out of the same transaction or occurrence as the plaintiff's claim. Aguilar v. Southeast Bank, N.A., 728 So.2d 744, 746 (Fla.1999); Arch Aluminum & Glass Co., Inc. v. Haney, 964 So.2d 228, 236 (Fla. 4th DCA 2007).
We consider the allegations in the counterclaim as true and in the light most favorable to Mr. Cunningham. See Londono, 609 So.2d at 18; Pondella Hall For Hire, Inc. v. Lamar, 866 So.2d 719, 721 (Fla. 5th DCA 2004). Such a reading of the counterclaim demonstrates that Mr. Cunningham's claims for violations of the FDCPA and the FCCPA, and for abuse of process, attack MBNA's alleged misuse of the arbitration process to secure payment of a credit card debt. These counts are compulsory; they are inextricably tied to the transaction or occurrence underlying MBNA's claim. Consequently, to the extent the trial court order dismissed those claims, the order is not appealable and we are compelled to dismiss the appeal as to those claims. See S.L.T. Warehouse, 304 So.2d at 99-100; W. Fla. Med. Clinic, P.A. v. Kumari, 996 So.2d 966 (Fla. 1st DCA 2008).
However, Mr. Cunningham's claims for defamation and negligence appear permissive. The allegations, though sketchy, suggest that those claims arise out of events not necessarily related, temporally or on the merits, to MBNA's efforts to secure compensation through arbitration. Thus, we conclude that the order granting MBNA's motion to dismiss is appealable as to those claims. See Johnson, 621 So.2d at 508. Those claims should have been dismissed with leave to amend. See generally Innovative Med. Servs., Inc. v. Reitz, 793 So.2d 125, 127 (Fla. 2d DCA 2001) (explaining that appellate court reviews counterclaims de novo and determines, as a matter of law, whether each count states a cause of action).
Dismissed in part, reversed in part, and remanded.
NORTHCUTT, C.J., Concurs.
SILBERMAN, J., Concurs in part and dissents in part with opinion.
SILBERMAN, Judge, concurring in part and dissenting in part.
I concur with the majority that Mr. Cunningham's counterclaims for violation of the Fair Debt Collection Practices Act, violation of the Florida Consumer Collection Practices Act, and abuse of process are compulsory counterclaims that are not reviewable in this appeal. However, I disagree that the counterclaims for defamation and negligence are permissive rather than compulsory and that they are reviewable in this appeal.
The defamation and negligence counterclaims, like Mr. Cunningham's other counterclaims, *442 are logically related to MBNA's complaint for damages and domestication of its arbitration award. MBNA is seeking payment that is allegedly due as a result of transactions made on a credit card issued in Mr. Cunningham's name. MBNA obtained an arbitration award for nonpayment of the transactions and then filed suit in the trial court to recover its damages. Mr. Cunningham's counterclaims, as pleaded, all arise from the same core of operative facts that give rise to MBNA's claim: MBNA issued a credit card in Mr. Cunningham's name; it allowed credit transactions to be made on the card; it pursued collection efforts, including arbitration proceedings, to recover payment; and it instituted suit to recover payment. In addition, the defamation and negligence counterclaims assert legal rights that would not have arisen had MBNA not pursued payment for the credit card transactions. For example, in the defamation counterclaim, Mr. Cunningham asserts that MBNA engaged in misconduct by falsely notifying credit reporting agencies that he had defaulted and had failed to pay the financial obligations arising from the credit card transactions. In the negligence counterclaim, Mr. Cunningham asserts that MBNA breached statutory and other duties by opening the credit card account and extending credit in his name; in allowing the unauthorized use of his "identification and information without verification"; in harassing him to collect the unpaid charges; in pursuing "an unauthorized and invalid Arbitration Award" against him; and in filing suit against him while knowing that he was not liable for the indebtedness.
Based on the operative facts giving rise to Mr. Cunningham's counterclaims, I cannot agree that the defamation and negligence counts are permissive counterclaims. In my view, all of Mr. Cunningham's claims are compulsory counterclaims that must await an appeal from the final judgment. See S.L.T. Warehouse Co. v. Webb, 304 So.2d 97, 100 (Fla.1974); Yunger v. Oliver, 803 So.2d 884, 887 (Fla. 5th DCA 2002). Accordingly, I would dismiss this appeal.
NOTES
[1] We note that the arbitration agreement is governed by the Federal Arbitration Act. See 9 U.S.C. §§ 1-16 (2000). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603737/ | 135 Mich. App. 424 (1984)
354 N.W.2d 367
POLICE OFFICERS ASSOCIATION OF MICHIGAN
v.
OAKLAND COUNTY
Docket No. 69798.
Michigan Court of Appeals.
Decided June 18, 1984.
Law Offices of Barry L. Howard (by Barry L. Howard and Frank A. Guido), for plaintiffs.
The Fishman Group (by Steven J. Fishman and Malcolm D. Brown), for Oakland County.
Oakland County Civil Counsel (by Jack C. Hays), for Daniel T. Murphy, C. Hugh Dohany, and Oakland County Board of Commissioners.
Before: BRONSON, P.J., and M.J. KELLY and R.S. HOFFIUS,[*] JJ.
*428 BRONSON, P.J.
Plaintiffs, Police Officers Association of Michigan (POAM) and Johannes Spreen, Oakland County Sheriff, appeal as of right from an order dismissing their complaint against defendants, Oakland County, Oakland County Board of Commissioners, Daniel T. Murphy, Oakland County Executive, and C. Hugh Dohany, Oakland County Treasurer.
Plaintiff POAM, as the union representing the employees of the Oakland County Sheriff's Department, entered into a collective-bargaining agreement with the Oakland County Sheriff and the Oakland County Board of Commissioners on January 23, 1981. The agreement was to remain in effect until December 31, 1981, and thereafter while a new agreement was being negotiated. The agreement incorporated the Oakland County Merit System Rules. Rule 9 provides for separation from county employment because of curtailment of work or lack of funds. The rule defines "curtailment of work" as:
"[A] situation in which the need for the employee's services are no longer required because the county no longer performs the function to which the employee was assigned, to the degree that the same number of employees are needed."
and defines "lack of funds" as:
"[A] situation in which the county is forced to drop positions because it does not have the funds to pay the salaries of the incumbent employees."
On May 20, 1982, after POAM and the employer had negotiated unsuccessfully for a new agreement, plaintiff POAM filed an amended petition for compulsory arbitration with the Michigan Employment *429 Relations Commission (MERC) pursuant to MCL 423.231 et seq.; MSA 17.455(31) et seq.
On December 2, 1982, defendant Oakland County Board of Commissioners passed the 1983 General Appropriations Act. The 1983 budget reduced the number of road patrol positions in the sheriff's department from 45 to 25. Plaintiff POAM, later joined in the action by the Oakland County Sheriff, Johannes Spreen, filed its original complaint in the instant suit, alleging that defendants had unilaterally altered the conditions of employment set forth in the rules of the Oakland County Merit System in violation of MCL 423.24; MSA 17.454(26). Plaintiff POAM requested that defendants be temporarily and permanently enjoined from effecting the scheduled layoffs on January 1, 1983, and sought a declaratory judgment as to whether the layoffs violated the Oakland County Merit System Rule 9.
The trial court denied plaintiff POAM's request for a permanent injunction. The parties agreed that the case could be resolved on a stipulation of facts. Following oral argument, the trial court dismissed plaintiff POAM's amended complaint, ruling that neither the state constitution, the applicable statute, the collective-bargaining agreement, nor the pending arbitration compelled the board of commissioners to appropriate funds for the road patrol.
The electorate of Oakland County has adopted the optional unified form of county government and has chosen to lodge administrative and executive power in an elected county executive pursuant to MCL 45.551 et seq.; MSA 5.302(51) et seq. Under MCL 45.558; MSA 5.302(58), the annual county budget is initially prepared by the county executive and submitted to the board of commissioners *430 for consideration. MCL 45.556; MSA 5.302(56) authorizes the board of commissioners to adopt a county budget and work program. The county executive may veto the board's action, subject to the board's authority to override the veto by a two-thirds vote of all board members. MCL 45.561; MSA 5.302(61).
The separation of powers doctrine mandates the preservation of the legislative, executive, and judicial branches of government as entities distinct from one another. Const 1963, art 3, § 2. The power to appropriate money is exclusively legislative in character. OAG 1979-1980, No 5816, p 1079. This Court has consistently refrained from interfering with a legislative body's exercise of discretion in appropriating funds. Wayne County Prosecutor v Wayne County Bd of Comm'rs, 93 Mich App 114, 121; 286 NW2d 62 (1979); Wayne County Sheriff v Wayne County Bd of Comm'rs (Court of Appeals opinion, docket no. 60933, decided November 22, 1983 [unreported]). In order to warrant judicial intrusion, the legislative action must be "so capricious or arbitrary as to evidence a total failure to exercise discretion". 93 Mich App 122-123; Veldman v Grand Rapids, 275 Mich 100, 113; 265 NW 790 (1936).
In ruling that the decision to eliminate 20 road patrol positions was within the discretion of the board of commissioners, the trial court stated:
"Now, they also eliminated these particular, in quotes, [sic] road patrol positions, and there's no question under the case law, statutory law, and not included in the constitutional duties of the sheriff, there is no mandate for road patrol. It's absolutely a permissive perfectly lawful but permissive function of the sheriff and its [sic] solely within the legislative discretion of *431 the board of commissioners whether they want to undertake that or not."
The statement is correct, but begs the question. Just because the board had discretion to eliminate the road patrol does not ipso facto mean that the board exercised its discretion without abuse. Furthermore, if the original appropriations decision was an abuse of discretion, the board could not remedy such abuse merely by complying with the Merit System Rules and the collective-bargaining agreement in determining which deputies would be laid off and in notifying the deputies.
In Wayne County Sheriff v Wayne County Bd of Comm'rs, supra, we were able to conclude that that board had not abused its discretion because the record was replete with evidence of the decision-making process undertaken by the board prior to eliminating the sheriff's road patrol. We were unable to find any indication that the elimination was motivated by malice, ill will, or bad faith on the part of the board.
In the instant case, plaintiff POAM alleged that the road patrol positions were eliminated in retaliation for the position taken by POAM in a pending labor dispute. Such a reason would not be a legitimate basis for a decision to eliminate the road patrol positions; therefore, plaintiff's allegation, if proved, would be evidence of an arbitrary or capricious exercise of discretion. We do not intimate that this was necessarily the basis for the board's decision. We do find, however, that the trial court, by terminating its inquiry with a finding that the board had discretion to eliminate the positions, failed to address the pertinent issue, i.e., whether the board abused its discretion. We, therefore, remand this case to the trial court to determine whether the board of commissioners abused its *432 discretion when it eliminated the 20 road patrol positions. Such a determination may require the taking of additional evidence.
We now turn to a second issue raised by plaintiffs. Plaintiffs argue that defendants were prohibited from effecting the layoffs during the pendency of the compulsory arbitration proceedings instituted by plaintiffs. MCL 423.243; MSA 17.455(43) provides:
"During the pendency of proceedings before the arbitration panel, existing wages, hours and other conditions of employment shall not be changed by action of either party without the consent of the other but a party may so consent without prejudice to his rights or position under this act."
In Local 1277, Metropolitan Council No 23, AFSCME, AFL-CIO v City of Center Line, 414 Mich 642, 654; 327 NW2d 822 (1982),[1] the Supreme Court held that compulsory arbitration extends only to mandatory subjects of collective bargaining under MCL 423.201 et seq.; MSA 17.455(1) et seq. (PERA).
While acknowledging PERA as the dominant law regulating public employee relations, Rockwell v Crestwood School Dist Bd of Ed, 393 Mich 616, 629; 227 NW2d 736 (1975), our courts have recognized that PERA does not compel bargaining over every subject proposed by a party. Some subjects may be "beyond the scope of collective bargaining *433 under PERA because they fall within the powers granted exclusively to the employer by the Michigan Constitution". National Union of Police Officers Local 502-M, AFL-CIO v Wayne County Bd of Comm'rs, 93 Mich App 76, 87; 286 NW2d 242 (1979).[2]
In City of Center Line, supra, the police officers' union had requested in its collective-bargaining agreement with defendant city a clause mandating that any layoff of police officers because of a general lack of funds could be made only in conjunction with layoffs and cutbacks in other city departments. In a unanimous opinion, the Supreme Court held that the initial decision to lay off employees is within the scope of the city's management prerogative and, therefore, was not a mandatory subject of bargaining. The Court stated:
"The [requested layoff provision] unduly restricts the city in its ability to make decisions regarding the size and scope of municipal services. As the city argued in both oral argument and its brief, the city no longer would be able to base its decision on factors such as need, available revenues, or public interest. The decision regarding layoffs could only be based on the level of services in other departments if the layoff clause was to be upheld. This severely restricts the city in its ability to function effectively and poses serious questions with regard to political accountability for such decisions." 414 Mich 660.
In the instant case, Merit System Rule 9, incorporated into the collective-bargaining agreement, provided for layoffs in the event of a lack of funds. Although defendant board of commissioners failed *434 to appropriate funds for the eliminated road patrol positions, the board reserved an amount in excess of the cost of the eliminated positions as a contingency fund in the adopted budget. Plaintiffs interpret the definition of "lack of funds" in Rule 9 to mean an "actual" lack of county funds rather than a lack of appropriated funds.
Plaintiffs concede that, under the optional unified form of government, defendants board of commissioners and county executive have power to adopt a county budget and allocate county funds to the various county departments. However, under plaintiffs' interpretation of the "lack of funds" provision, the county executive "bargained away" the board of commissioners' exclusive power to allocate funds. Such a contention is a variation of the argument rejected by the Supreme Court in City of Center Line, supra.
The discretionary authority to determine a county budget cannot be limited by a collective-bargaining agreement. The Legislature's power to appropriate funds is constitutionally derived. Const 1963, art 4, § 31; art 9, § 17; Civil Service Comm v Auditor General, 302 Mich 673, 682-683; 5 NW2d 536 (1942). Under the optional unified form of government statute and pursuant to Const 1963, art 7, § 8, the Legislature granted budget authority to the board of commissioners and the county executive. Implicit in plaintiffs' argument is the premise that under the optional unified form of government statute, the Legislature has authorized the county executive to transfer, through labor negotiations, a portion of the budget authority to a third party, i.e., plaintiffs. We do not believe the statute evinces such an intent. Instead, the statute provides that the county board of commissioners adopts the county budget and the *435 county executive's input is limited to the initial submission of a proposed budget and the statutory veto power. An attempt by the county executive to otherwise limit the board of commissioners' authority to allocate county funds would infringe upon the Legislature's constitutional authority in these matters.
Michigan courts have adopted a broad and expensive interpretation of what constitutes proper subjects for collective bargaining under PERA. Local 1383, International Ass'n of Fire Fighters, AFL-CIO v City of Warren, 411 Mich 642, 655; 311 NW2d 702 (1981). Nonetheless, we conclude that budget appropriations are not a proper subject for collective bargaining. Defendant board of commissioners has authority under its collective-bargaining agreement with plaintiff POAM to lay off road patrol deputies where the county budget failed to appropriate funds for the affected positions. Furthermore, defendant's action was not preempted by the initiation of compulsory arbitration.
Remanded for proceedings in accordance with this opinion. We do not retain jurisdiction.
R.S. HOFFIUS, J., concurred.
M.J. KELLY, J. (concurring in part; dissenting in part).
I concur with the majority in concluding that the trial court failed to consider whether the board of commissioners abused its discretion when it eliminated 20[1] road patrol positions. I dissent, however, from the majority's refusal to apply MCL *436 423.243; MSA 17.455(43) as a significant limitation on the scope of the commissioners' discretion.
I
The trial court in this case ignored the statutory prohibition on unilateral changes in conditions of employment during the pendency of compulsory arbitration proceedings instituted under 1969 PA 312, MCL 423.231 et seq.; MSA 17.455(31) et seq. The relevant section provides:
"During the pendency of proceedings before the arbitration panel, existing wages, hours and other conditions of employment shall not be changed by action of either party without the consent of the other but a party may so consent without prejudice to his rights or position under this act." MCL 423.243; MSA 17.455(43).
Since POAM had filed a petition for compulsory arbitration pursuant to 1969 PA 312 and the parties had stipulated that they were involved in negotiations at the time the positions were eliminated, the board of commissioners was prohibited by statute from laying off sheriff's deputies for reasons other than those provided in the collective-bargaining agreement and in the Oakland County Merit System Rules.[2] Rule 9 limits the commissioners' authority to lay off county employees except for curtailment of work or lack of funds.
Under the majority view, the trial court on remand need only consider whether the commissioners acted arbitrarily or capriciously in terminating the 20 road patrol positions. I believe the issue on remand should be narrower. As I see it, the dispute in this case is whether the commissioners *437 unilaterally changed a condition of employment during arbitration by eliminating county employees for a reason other than not having the funds to pay the salaries of these employees. This view is consistent with that pronounced in Metropolitan Council No 23, Local 1277, AFSCME, AFL-CIO v City of Center Line, 78 Mich App 281; 259 NW2d 460 (1977), lv den 402 Mich 814 (1977).[3] In that case, which I hereafter refer to as Center Line #1, the union's collective-bargaining agreement permitted layoffs only for "lack of work". In light of the statutory prohibition against changing existing wages, hours, or other conditions of employment during the pendency of compulsory arbitration, this Court ruled that the granting of a permanent injunction was proper to prevent the laying off of road patrol personnel for economic reasons while the dispute was being arbitrated.
Contrary to the majority opinion, I find Local 1277, Metropolitan Council No 23, AFSCME, AFL-CIO v City of Center Line, 414 Mich 642; 327 NW2d 822 (1982), (Center Line #2) inapposite. In that case, the Supreme Court held that a collective-bargaining provision such as the one here, limiting the commissioners' right to terminate employees for economic reasons other than lack of funds, does not constitute a mandatory subject of bargaining and may not, therefore, be incorporated by an arbitration panel into an arbitrated labor agreement by the arbitrator's fiat.
*438 We are not presented with an arbitrated agreement here. A collectively bargained for agreement was already in effect and the dichotomy between mandatory and permissive subjects of bargaining is thus beside the point. The issue here is one of interpretation and application of a collectively bargained for provision. The board of commissioners was either faced with "a situation in which the county [was] forced to drop positions" for lack of funds or it was not. It seems to me that the board cannot arbitrarily choose not to fund the budget for the affected employment positions simply to create a "lack of funds" which does not otherwise exist. If that were the case, the applicable Oakland County Merit System Rule would mean absolutely nothing.
The majority opinion says that the plaintiffs' position is that the county executive bargained away the commissioners' exclusive power to allocate funds. This is not plaintiffs' position at all. Plaintiff POAM's bargaining agreement is with Oakland County. Under the strong executive form of Oakland County government, Mr. Murphy's office does the bargaining. MCL 45.563(g); MSA 5.302(63)(g). To imply that there are different pockets of power at odds is deceptive. The executive bargains for the county and hence for the commissioners.
I do not agree that in bargaining away the right to lay off employees for economic reasons other than lack of funds the executive, for the commissioners and for the county, bargained away a power reserved to management to allocate funds. If this were true, the executive would also be prohibited from bargaining away the county's right to unilaterally reduce employee wages since such a limitation would similarly intrude upon the *439 commissioners' "exclusive" right to fix wages. I believe that it is entirely permissible for the county executive on behalf of the commissioners and the county to, through the process of collective bargaining, voluntarily limit any right to terminate employees for economic reasons.
II
As noted by the majority, the 1980-1981[4] collective-bargaining agreement between POAM and the Oakland County Commissioners provides for separation from county employment because of curtailment of work or lack of funds. There is no indication in the trial transcript or in the parties' stipulation of facts that Oakland County had no need for the services of the road patrol deputies. The apparent basis for defendants' elimination of the road patrol positions was insufficient finances.[5] The parties, however, stipulated that the amount reserved as a contingency fund in the board of commissioners' adopted budget exceeded the cost of the positions which were eliminated in the 1983 budget. I would remand this case for a determination by the trial court of whether the commissioners' *440 elimination of the 20 road patrol positions was properly based on lack of funds. While the parties would have the trial court focus on whether "lack of funds" as contained in Rule 9 of the Merit System Rules means "lack of actual funds" or "lack of appropriated funds", I do not perceive the issue in this way. I would order consideration of the county budget as a whole to determine whether the budget as adopted evidences an arbitrary or capricious attempt on the part of the commissioners to eliminate road patrol positions for reasons that are not justified by overall county budgetary needs.
Contrary to defendants' assertion, this case may be properly remanded to the trial court rather than submitted to binding arbitration. In Center Line #1, this Court ruled that where the parties are currently in arbitration under 1969 PA 312 and a question arises as to whether there has been a unilateral change in an employment condition, the dispute may be resolved in circuit court:
"While the city's actions may have constituted unfair labor practices under MCL 423.210; MSA 17.455(10), the union did not invoke the provisions of PERA. 1969 PA 312 is separate and distinct from PERA, dealing with the particular problems of labor disputes with policemen and firemen. Because of the need for expediency in dealing with labor problems that might disrupt the crucial services these public employees provide, enforcement of 1969 PA 312 should not be encumbered by the procedure set forth in PERA. Nothing in 1969 PA 312 or any other statute prevents the judicial enforcement of the provisions of 1969 PA 312, and it was proper for the circuit court to assume jurisdiction over this dispute. Const 1963, art 6, § 13." 78 Mich App 284.
I would thus order remand for a determination *441 by the circuit court as to whether the commissioners' adopted budget for 1983 satisfied § IV of Rule 9 of the Oakland County Merit System Rules. If there was no "lack of funds" within that definition the trial court should order reinstatement.
NOTES
[*] Circuit judge, sitting on the Court of Appeals by assignment.
[1] Local 1277 v City of Center Line, supra, should not be confused with Metropolitan Council No 23, Local 1277, AFSCME, AFL-CIO v City of Center Line, 78 Mich App 281; 259 NW2d 460 (1977), lv den 402 Mich 814 (1977). We do not cite the Supreme Court case in the Local 1277 proceedings because of any supposed "connection" between the Court of Appeals case and the Supreme Court case. Were the Supreme Court case totally unrelated to the Court of Appeals case, we would nonetheless use it as the basis for our analysis in the instant case.
[2] We note, however, that the Supreme Court has rejected the idea that an institution which derives its powers from the constitution is insulated from the collective-bargaining obligation of PERA. Central Michigan Univ Faculty Ass'n v Central Michigan Univ, 404 Mich 268, 279; 273 NW2d 21 (1978), reh den 406 Mich 1117 (1979).
[1] Stipulation of facts no. 18 provides:
"The funds appropriated as reserve for contingency in the board of commissioners' adopted budget for 1983 exceed the cost of the 20 patrol officer and 7 command level positions which were eliminated by the board of commissioners in adopting the budget for 1983." Apparently the seven command level positions are not at issue.
[2] Stipulation of facts nos. 10 and 11 include both the agreement and the Merit System Rules.
[3] This case represents a development which preceded Local 1277, Metropolitan Council No 23, AFSCME, AFL-CIO v City of Center Line, 414 Mich 642; 327 NW2d 822 (1982). This Court's decision in 78 Mich App 281 was not appealed to the Supreme Court. Shepard's Michigan Citations signals these cases as connected. It is submitted that different legal principles apply to these connected precedents but that the earlier decision is of paramount importance to the decision of this case. The Supreme Court in Center Line #2 specifically stated that the decision in Center Line #1 was not the subject of review. 414 Mich 647.
[4] This agreement covered the period January 1, 1980, through December 11, 1981, plus extensions. We are not informed why it was not executed until January 23, 1981.
[5] Plaintiff's brief makes reference to plaintiff's Exhibit No. 11 as follows:
"The Oakland County 1983 Budget contains a surplus approaching $6,000,000.00 (See Plaintiff's Exhibit Number 11). At issue is not the specific level of the surplus, what is at issue is the total disregard by the defendants and the trial court of the contractual mandate that there be no layoffs unless a lack of funds exist."
Since this exhibit is not tied into the stipulation of facts it is not clear whether this is in part or in whole the contingency fund referred to in stipulation of fact no. 18:
"The funds appropriated as reserve for contingency in the board of commissioners' adopted budget for 1983 exceed the cost of the 20 patrol officer and 7 command level positions which were eliminated by the board of commissioners in adopting the budget for 1983." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1737278/ | 548 So. 2d 333 (1989)
Richard G. DAIGRE
v.
The TERREBONNE ASSOCIATION FOR RETARDED CITIZENS.
No. 89-C-1443.
Supreme Court of Louisiana.
September 22, 1989.
*334 Denied. The result is correct.
CALOGERO and DENNIS, JJ., would grant the writ. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552295/ | 41 B.R. 584 (1984)
In re Archie K. SHIPE, Jr., Julia Ann Shipe, Debtors.
SUPER CONCRETE CORPORATION, Plaintiff,
v.
Archie K. SHIPE, Jr., Julia Ann Shipe, Defendants.
Bankruptcy No. 83-1-0169, Adv. No. 83-0495A.
United States Bankruptcy Court, D. Maryland, at Rockville.
June 27, 1984.
*585 Charles Kirchman, Wheaton, Md., for debtor/defendants.
Mitchell Stabbe, Washington, D.C., for plaintiff.
MEMORANDUM OF DECISION
PAUL MANNES, Bankruptcy Judge.
This matter comes before the court upon the filing by Super Concrete Corporation ("Super Concrete") of a complaint to determine the dischargeability of a debt owed Super Concrete by Archie K. Shipe and Julia Ann Shipe ("the Shipes"), the debtors herein. After hearing and upon submission of briefs, this court makes the following determination.
K & J Associates ("K & J"), a business wholly owned by Archie K. Shipe, incurred a debt with Super Concrete in the amount of $11,137.96 for materials sold to K & J. Super Concrete placed liens on the properties at several jobs of K & J in an attempt to satisfy this indebtedness. The debtor's attorney and brother-in-law, Mr. Richard A. Micheel, owned Lifetime Pools, which was the general contractor for these jobs. The placing of these liens resulted in the freezing of funds due Mr. Micheel's company as well as funds due K & J. Therefore, the Shipes and Mr. Micheel drew up an assignment in favor of Super Concrete to induce Super Concrete to release its liens. Super Concrete subsequently released its liens, and the assignment was filed among the land records of Montgomery County, Maryland, and a copy of the assignment is attached as an appendix to this opinion.
The two operative paragraphs of the assignment provided:
WHEREAS, Parties of 2nd part have the above described property listed for sale with a registered real estate broker, and expect to sell the acreage and improvements in the near future, and in consideration of releasing all liens by the party of the first part, then the Parties of the 2nd part assigns all their rights to the monies owed to the party of the 1st part amounting to $11,137.96 coming from the proceeds of the settlement of the above stated property.
It is understood that Richard A. Micheel will be handling the settlement of this property and the parties of the 2nd part hereby authorizes Richard A. Micheel, Attorney to honor this assignment, and to withhold $11,137.96 from the monies at the time of settlement and pay to the party of the first part.
The property was subdivided and sold, but Mr. Micheel did not act as the settlement attorney for the sales, and the Shipes failed to turn over $11,137.96 of the proceeds to Super Concrete as provided in the assignment. Instead, the Shipes applied the proceeds that they received from the sales of the property to the payment of other creditors and to the purchase of another property. The Shipes filed a joint Chapter 7 petition in bankruptcy with this court on February 3, 1983, and scheduled Super Concrete as having an unsecured, disputed claim in the amount of $11,137.96.
Super Concrete contends that the Shipes' debt is nondischargeable on three distinct grounds. First, the plaintiff asserts that the debt is nondischargeable under 11 U.S.C. § 523(a)(2)(A) for obtaining an extension, renewal, or refinance of credit at the time of execution of the assignment by false pretenses, a false representation or by actual fraud. Second, the plaintiff argues that the debt is nondischargeable because at the time of the real estate settlement the debtors obtained money (the proceeds of the sale assigned to Super Concrete) by false pretenses, a false representation, or actual fraud. 11 U.S.C. § 523(a)(2)(A). Third, the plaintiff asserts that the debtors obtained the money by fraud or defalcation while acting in a fiduciary capacity. 11 U.S.C. § 523(a)(4).
Examining the plaintiffs' first contention, that the debt is nondischargeable because at the time the debtors executed *586 the assignment they had no intention of honoring it, the court finds that the plaintiff has not met its burden of demonstrating that the Shipes had no intention to repay at the time the assignment was made. One of the primary purposes of the bankruptcy law is to relieve honest debtors of the burden of their indebtedness and to provide them with a fresh start so that they can become productive members of society. Perez v. Campbell, 402 U.S. 637, 648, 91 S. Ct. 1704, 1710, 29 L. Ed. 2d 233 (1971); Stellwagen v. Clum, 245 U.S. 605, 617, 38 S. Ct. 215, 218, 62 L. Ed. 507 (1918). The court must therefore strictly construe the exceptions to discharge set forth in 11 U.S.C. § 523(a)(2). Gleason v. Thaw, 236 U.S. 558, 562, 35 S. Ct. 287, 289, 59 L. Ed. 717 (1915). Accordingly, the creditor bears the burden of establishing that the debt sought to be declared nondischargeable falls within the statutory exception. In re Cross, 666 F.2d 873, 880 (5th Cir.1982); Matter of Nappi, 29 B.R. 233, 234 (B.C.M. D.Fla.1983); In re Lambert, 21 B.R. 23, 24 (B.C.E.D.Mich.1980).
Where a creditor seeks an exception to discharge based upon allegations of fraud, misrepresentation, or false pretenses, the creditor has the burden of establishing his claim by clear and convincing evidence. Matter of Richmond, 29 B.R. 555, 558 (B.C.M.D.Fla.1983); In re Newmark, 20 B.R. 842, 853 (B.C.E.D.N.Y.1982); In re Neumann, 13 B.R. 128, 130 (B.C.E.D. Wis.1981).
In this case, the plaintiff alleges that at the time the debtors executed the assignment they obtained an extension, renewal, or refinance of credit by false pretenses, a false representation, or by actual fraud. False representations and false pretenses encompass statements that depict current or past facts falsely. In re Todd, 34 B.R. 633, 635 (B.C.W.D.Ky.1983), citing Black's Law Dictionary 541 (Rev. 5th Ed. 1979); In re Simpson, 29 B.R. 202 (B.C.N.D. Iowa 1983); Matter of Shepherd, 13 B.R. 367 (B.C.S.D. Ohio 1981); In re Buttendorf, 11 B.R. 558 (B.C.Vt.1981). A false representation requires an express misrepresentation, whereas false pretenses involves an implied misrepresentation or conduct intended to create and foster a false impression. Matter of Weinstein, 31 B.R. 804 (B.C.E.D.N.Y.1983); In re Newmark, 20 B.R. 842 (B.C.E.D.N.Y.1982); In re Schnore, 13 B.R. 249 (B.C.W.D.Wis. 1981); In re Pommerer, 10 B.R. 935 (B.C. Minn.1981).
The type of "fraud" necessary to satisfy an objection under this section has been defined as:
". . . positive fraud, or fraud in fact, involving moral turpitude or intentional wrong, as does embezzlement; and not implied fraud, or fraud in law, which may exist without the imputation of bad faith or immorality. Such a construction of the statute is consonant with . . . the intention of Congress in enacting a general law by which the honest citizen may be relieved from the burden of hopeless insolvency."
Matter of Reinstein, 32 B.R. 885, 888 (B.C.E.D.N.Y.1983) citing Neal v. Clark, 95 U.S. 704, 709, 5 U.S. 704, 24 L. Ed. 586 (1887).
Generally, a cause of action for fraud will not lie for misrepresentations as to future promises or facts, but an exception exists where, at the time the promise was made, the promissor had the intent not to perform the promised act. In re Turner, 12 B.R. 497, 7 B.C.D. 1119, 1121 (B.C.N. D.Ga.1981) citing Shear v. Nat'l Rifle Assn. of America, 606 F.2d 1251, 1259 (D.C.Cir.1979). See also, Fredonia Broadcasting Corp., Inc. v. RCA Corp., 481 F.2d 781, 796 (5th Cir.1978); Bisset v. Ply-Gem Industries, Inc., 533 F.2d 142, 145 (5th Cir.1976). The plaintiff in this case seeks to base Count I of this dischargeability complaint upon this narrow exception to the general rule.
To sustain an objection based upon § 523(a)(2)(A), an objecting creditor must show the existence of the following elements:
(1) the debtor made the (express or implied) representations;
*587 (2) that he knew at that time were false;
(3) that he made them with the intention of deceiving the creditor;
(4) that the creditor relied on the representations; and
(5) that the creditor sustained the alleged loss and damage as a result of the representations having been made.
In re Carneal, 33 B.R. 922, 925 (B.C.E.D. Va.1983); In re Newmark, 20 B.R. 842, 853-54 (BC.E.D.N.Y.1982); In re Houtman, 568 F.2d 651, 655 (9th Cir.1978); Matter of Nelson, 561 F.2d 1342, 1346 (9th Cir.1977). The objecting creditor must establish the existence of each of these elements by clear and convincing evidence. Brown v. Buchanan, 419 F. Supp. 199 (E.D. Va.1975).
The court finds from the testimony elicited from the debtors and Mr. Micheel that the Shipes did not enter into the assignment with the intent of dishonoring it at a later date. Mr. Micheel testified that if he had been the settlement attorney for the subsequent sales, he would have considered the assignment binding upon the Shipes. No evidence of a deliberate scheme to dupe Super Concrete into accepting a worthless assignment was adduced at trial. The only evidence produced by the plaintiff of fraud, false pretenses, or a false representation at the time of the assignment was the failure of the Shipes to turn over the proceeds at a later date. Generally, the mere breach of a promise to pay does not support a finding of fraud. In re Todd, 34 B.R. 633, 636 (B.C.W.D.Ky.1983); In re Simpson, 29 B.R. 202 (B.C.S.D.Iowa 1983); In re Boese, 8 B.R. 660 (B.C.S.D.1981); In re Brooks, 4 B.R. 237 (B.C.S.D.Fla.1980). The court holds, therefore, that the plaintiff has not met its burden of proving by clear and convincing evidence that the Shipes obtained an extension, renewal, or refinance of credit at the time of execution of the assignment by false pretenses, a false representation, or by actual fraud.
Similarly, the plaintiff has failed to meet its burden with respect to proving that at the time of the real estate settlement the debtors obtained the proceeds by false pretenses, a false representation, or actual fraud. Both debtors testified at trial and during their depositions that they fully intended to repay Super Concrete. The debtors stated that the first $12,000 of the proceeds that they obtained from the sales of the property was used to pay the creditors who first appeared demanding payment, including the Internal Revenue Service, The debtors and the settlement attorney for the second sale from which proceeds were paid to the debtors testified further that they believed that the assignment need not be honored. The settlement attorney, James G. Kolb, testified that he had even discussed the matter with the then incumbent head of the real estate section of the county bar association, who purportedly opined that the assignment need not be honored at settlement. The plaintiff produced no evidence of any fraud occurring at the time of settlement other than the mere fact that Super Concrete was not paid at that time.
Given the paucity of evidence adduced by the plaintiff, the court holds that the plaintiff has failed to establish the requisite elements of Count II by clear and convincing evidence.
Under Count III, the plaintiff asserts that the debt is nondischargeable under § 523(a)(4) because the Shipes obtained the money assigned to Super Concrete by fraud or defalcation while acting in a fiduciary capacity. The predecessor to this section, section 17(a)(4) of the Bankruptcy Act, was interpreted by the Supreme Court to require a technical trust relationship rather than one implied from contract. Davis v. Aetna Acceptance Co., 293 U.S. 328, 333, 55 S. Ct. 151, 153, 79 L. Ed. 393 (1934). The Court construed this section to require that the trust relationship exist prior to the transaction creating the debt. Id.
Subsequent Supreme Court decisions have looked to state law in determining whether a prior trust relationship existed *588 between the contracting parties. Jaffke v. Dunham, 352 U.S. 280, 281, 77 S. Ct. 307, 308, 1 L. Ed. 2d 314 (1957) (whether trust established is a question of state law). In Hamby v. St. Paul Mercury Ins. Co., 217 F.2d 78 (4th Cir.1954), the Court of Appeals held that the case law in Virginia clearly made the realtor-client relationship fiduciary in nature. Id. at 80. See also, Matter of Dloogoff, 600 F.2d 166, 169-70 (8th Cir. 1979) (debt dischargeable because Nebraska Supreme Court construed law not to establish an express trust); Decker-Ruhl Ford v. Ford Motor Credit, 523 F.2d 833, 837 (8th Cir.1975) (by executing assignment, dealer became fiduciary with respect to assigned funds collected); Allen v. Romero, 535 F.2d 618, 621 (10th Cir.1976) (licensing statute for construction contractors construed to impose fiduciary duties); Contra, Schlecht v. Thornton, 544 F.2d 1005, 1007 (9th Cir.1976) (fiduciary relationship not established by Oregon law imposing trusteeship on employer).
The Maryland Court of Appeals considered the question of whether an agreement to pay money out of the proceeds of the sale of land created a trust relationship in Johnson v. Johnson, 40 Md. 189 (1874). In Johnson, the Maryland Court of Appeals determined that an agreement much like the assignment executed in the present case created a trust relationship between the assignor and assignee. Id., 40 Md. at 198. The plaintiff has cited numerous other decisions in which state courts have held that an assignment created a trust relationship, but this court need only determine whether a trust relationship is created under Maryland law. Given the near identity of the assignment in the present case and the assignment in Johnson, this court concludes that Maryland law makes the assignor-assignee relationship fiduciary in nature. The Shipes' failure to honor the assignment upon receipt of the proceeds clearly constitutes a defalcation of their fiduciary responsibilities, therefore the debt of $11,137.96 (with interest from February 26, 1981, the date of settlement) is nondischargeable under § 523(a)(4).
Counsel for the plaintiff shall prepare an order in accordance with this memorandum, together with a supporting interest worksheet.
APPENDIX
Law Offices
RICHARD A. MICHEEL
Federal Bar Building
Washington, D.C. 20006
B72-0702
ASSIGNMENT
This Assignment made this 27th day of October, 1978, between SUPER CONCRETE CO., of Washington, D.C., party of the first part and K & J ASSOCIATES, INC., ARCHIE K. SHIPE and JULIA ANN SHIPE, of Brookville, Maryland, Parties of the second part is as follows:
WHEREAS, Party of the 2nd part has an indebtedness with the Party's of the 1st part in the amount of Eleven Thousand One Hundred and Thirty Seven Dollars and Ninety Six Cents ($11,137.96), arising from concrete delivered to several jobs of K AND J ASSOCIATES, INC. up to October 15, 1978.
WHEREAS, Party of the 1st part has placed liens on several jobs of K & J ASSOCIATES, and K & J is desirous of having an immediate release on all jobs these liens have been placed, and or any jobs party of the first part is entitled to place a lien upon.
WHEREAS, Parties of 2nd part own in fee simple 36 acres, with improvements in Montgomery County at 1901 Brighton Dam Road, Brookville, Maryland 20729, and recorded in among land records of Montgomery County, Maryland in Liber 492 at Folio 397 and being more particularly described in accordance with a plat of Survey prepared by MCA Engineering Corporation, Rockville, Maryland on September 1974.
WHEREAS, Parties of 2nd part have the above described property listed for sale with a registered real estate broker, and expect to sell the acreage and improvements *589 in the near future, and in consideration of releasing all liens by the party of the first part, then the Parties of the 2nd part assigns all their rights to the monies owed to the party of the 1st part amounting to $11,137.96 coming from the proceeds of the settlement of the above stated property.
It is understood that Richard A. Micheel will be handling the settlement of this property and the parties of the 2nd part hereby authorizes Richard A. Micheel, Attorney to honor this assignment, and to withhold $11,137.96 from the monies at the time of settlement and pay to the party of the first part.
SIGNED AND SEALED THIS 27th day of October, 1978 by the party of the first part and the parties of the second part, and agreed to by Richard A. Micheel, Attorney
SUPER CONCRETE CORPORATION
/s/ Murray Simpson J. President /s/ Archie K. Shipe, Jr.
MURRAY SIMPSON-Party of 1st part ARCHIE K. SHIPE, Party of 2nd part
/s/ Richard A. Micheel /s/ Julia A. Shipe
RICHARD A. MICHEEL, ATTORNEY JULIA ANN SHIPE, Party of 2nd part
State of Maryland
County of Montgomery: ss
On this 27th day of October, 1978, before me, the undersigned officer, personally appeared ARCHIE K. SHIPE and JULIA ANN SHIPE, known to me to be the persons whose names are subscribed to the within instrument and acknowledged that they executed the same for the purpose therein contained.
In witness whereof, I hereunto set my hand and official seal.
/s/Jerry E. Jarosik
Jerry E. Jarosik
Notary Public
My Commission expires: 7-1-82
[SEAL] | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/279485/ | 392 F.2d 155
Ray S. BAILEY, Appellant,v.Ellis C. MacDOUGALL, Director of the South CarolinaDepartment of Corrections, et al., Appellees.
No. 11735.
United States Court of Appeals Fourth Circuit.
Argued Dec. 4, 1967.Decided Feb. 28, 1968.
Betty M. Sloan, Columbia, S.C., for appellant.
Edward B. Latimer, Asst. Atty. Gen. of South Carolina (Daniel R. McLeod, Atty. Gen. of South Carolina, and B. O. Thomason, Jr., Sol., Thirteenth Judicial Circuit, on brief), for appellees.
Before BOREMAN, BRYAN and BUTZNER, Circuit Judges.
BUTZNER, Circuit Judge:
1
Ray S. Bailey was sentenced to life imprisonment in 1936 upon a plea of guilty to murder. Now Bailey challenges the validity of his plea, which was entered after the chief of police and the state's solicitor promised in writing they would recommend parole or pardon after Bailey had served a term not exceeding ten years. We hold that Bailey's arraignment was defective and the record fails to establish he understood the consequences of his plea. We remand the case for proceedings consistent with this opinion.
2
Bailey applied for a writ of habeas corpus in 1964 in the Court of Common Pleas for Richland County, South Carolina. After a full evidentiary hearing, the court found that Bailey's guilty plea was not voluntary, and ordered a new trial. Upon appeal the Supreme Court of South Carolina reversed and entered final judgment discharging the writ.1 Bailey then applied to the United States District Court for a writ of habeas corpus, which was denied upon the basis of the state records without a plenary hearing.
3
A policeman, attempting to thwart a bank robbery, was killed in 1932 in Greenville, South Carolina. A few days later Bailey was charged with murder. Following an unsuccessful fight against extradition from North Carolina,2 Bailey fled to Georgia. He was captured and returned to Greenville for trial. His brother, C. M. Bailey, and other members of his family retained a capable and experienced lawyer to defend him. He steadfastly maintained that he was not in Greenville the night of the murder, and upon his arraignment he pleaded not guilty.
4
The mainstay of the prosecution's case was a witness named Corea, who identified Bailey as the murderer of the policeman. Corea was sentenced to prison for robbery and refused to testify unless he was pardoned. The South Carolina solicitor who was prosecuting the case knew that another eyewitness was unable to identify Bailey positively. He also knew a number of witnesses would support Bailey's alibi. The solicitor suggested to Bailey's lawyer that Bailey plead guilty 'with a recommendation to mercy.'3 This plea would result in a mandatory life sentence. Bailey's lawyer did not know Corea refused to testify.4 He thought the evidence would be sufficient to take the case to the jury and he knew that public sentiment was aroused over the killing. He said that he could advise his client to plead guilty to manslaughter, but the solicitor declined this offer. The lawyers finally agreed that if Bailey would enter a plea of guilty to murder with recommendation to mercy, the solicitor and the chief of police would recommend a pardon or parole after Bailey had served not more than ten years.
5
The defense attorney advised Bailey that if he did not participate in the shooting he should not plead guilty. The attorney explained that the plea arrangement meant a life sentence would be imposed, and it did not mean the Governor would have to grant parole or pardon. He added that ordinarily the Governor would give great weight to the recommendation of the solicitor and the chief of police.5 Bailey agreed to plead guilty. His attorney, out of an abundance of caution, required the solicitor and chief of police to put their promise in writing. They signed this statement:
6
'This will confirm our conversation that in the event that Ray Bailey enters a plea of guilty with recommendation to mercy in the case now pending against him in the General Sessions Court for Greenville County that I will, knowing the facts of the case and the circumstances surrounding same, after the said Ray Bailey has served for a period not exceeding ten years, recommend to the Board of Pardons or Governor a pardon or parole.'
7
Bailey withdrew his original plea and pleaded guilty with recommendation to mercy. He was sentenced to life imprisonment. No one mentioned the agreement. No inquiry was made to determine whether Bailey's plea was voluntary or whether he understood the charges against him and the consequences of his plea. In the state habeas hearing the solicitor testified that he believed the trial judge was not aware of the agreement.
8
Bailey's lawyer placed the statement in his safety deposit box. At the expiration of the ten year period, the solicitor, the chief of police, and Bailey's attorney unsuccessfully asked the Governor and the State Parole Board to pardon or parole Bailey.6
9
At the state habeas corpus hearing, Bailey testified that he was not in Greenville at the time the police officer was killed, and that at first he refused to plead guilty. He agreed to change his plea because he was certain any agreement the solicitor made would be carried out. He testified that there wasn't any doubt in his mind that he would be released in ten years.
10
Bailey was not alone in testifying he believed he would serve only ten years. The assistant solicitor, who investigated the case and was present at the arraignment, testified that '* * * when that plea was entered by that boy, at that time, I was convinced that, after service of these ten years, without doing something in the penitentiary to prevent it, he would have been released. I was convinced of it and I am sure that everybody in the courtroom that knew anything about it was.'
11
Bailey raises several questions about plea bargaining. He does not urge the practice in itself is unconstitutional.7 He does claim the promise rendered his plea involuntary and that his arraignment was constitutionally defective.
12
The state habeas judge found Bailey believed he would serve not more than ten years and that the agreement leading to his change of plea 'vitiated the voluntary nature of the guilty plea.' The Supreme Court of South Carolina concluded this judgment was erroneous.8 The State Supreme Court emphasized that the promise was only to recommend parole or pardon and that it had been kept, that the written statement was unambiguous, and that Bailey's attorney had explained to him that the Governor might not follow the recommendation. It concluded that the evidence did not disclose that the plea was induced by coercion, false promises, or misrepresentation, and that Bailey's plea was voluntary.
13
In Machibroda v. United States, 368 U.S. 487, 493, 82 S. Ct. 510, 513, 7 L. Ed. 2d 473 (1962), the Court held:
14
'A guilty plea, if induced by promises or threats which deprive it of the character of a voluntary act, is void. A conviction based upon such a plea is open to collateral attack. See Walker v. Johnston, 312 U.S. 275, 61 S. Ct. 574, 85 L. Ed. 830; Waley v. Johnston, 316 U.S. 101, 62 S. Ct. 964, 86 L. Ed. 1302; Shelton v. United States, 356 U.S. 26, 78 S. Ct. 563, 2 L. Ed. 2d 579, reversing 5 Cir., 246 F.2d 571.'
15
The voluntariness of Bailey's plea does not depend upon whether he was the victim of a false promise. The question remains: Did the promise, even if fulfilled,9 induce the plea and deprive it of the character of a voluntary act? Whether Bailey's plea was voluntary raises issues of fact, upon which the state courts differed. The state appellate court's rejection of the state habeas court's findings ordinarily would require us to remand the case to the federal district court for an evidentiary hearing. Townsend v. Sain, 372 U.S. 293, 83 S. Ct. 745, 9 L. Ed. 2d 770 (1963). However, we find a remand unnecessary because the case can be decided upon an alternative ground which, under the circumstances, does not require another evidentiary hearing.
16
Bailey contends he was denied due process of law because the court did not advise him of the consequences of his plea. In examining whether Bailey fully understood the consequences of his plea, we limit ourselves to the direct consequences-- the length of the sentence to be served.10 Whether Bailey understood the consequences of his plea depends upon whether he understood the plea agreement. He claims the agreement meant he would be imprisoned not more than ten years. The state says the agreement provided only that he would be recommended for parole or pardon at the end of ten years.
17
In Kercheval v. United States, 274 U.S. 220, 223, 47 S. Ct. 582, 583, 71 L. Ed. 1009 (1927), the Court said:
18
'A plea of guilty differs in purpose and effect from a mere admission or an extrajudicial confession; it is itself a conviction. Like a verdict of a jury, it is conclusive. More is not required: the court has nothing to do but give judgment and sentence. Out of just consideration for persons accused of crime, courts are careful that a plea of guilty shall not be accepted unless made voluntarily after proper advice and with full understanding of the consequences.'
19
No particular form or ritual is required, but it must appear that the defendant understood the consequences of his plea.11 The evidence discloses, however, that no inquiry was made by anyone to determine Bailey's understanding of the consequences of his plea. The judge asked him no questions. Indeed, it appears from the record that the judge himself did not know the full consequences. Bailey's attorney did his best to explain it, but he testified at the habeas corpus hearing that he could not say that Bailey or his brother understood the proposition. Apparently the court and Bailey's attorney assumed that Bailey understood. Bailey challenges the validity of this assumption. He claims he thought the consequences would be not more than ten years' confinement in prison.
20
Ordinarily there is no great difficulty in ascertaining that the defendant understood the consequences of his plea even when the parties have engaged in plea bargaining. The bargain itself generally is laid before the court through the recommendation and motions of the prosecuting attorney.12 The difficulty arises in Bailey's case because the promise made by the prosecuting officers was extrajudicial. It was never revealed in open court, although Bailey's attorney and the solicitor both recognized that it was indispensable to securing Bailey's plea and that it had an important bearing upon Bailey's punishment. Regardless of whether we accept the state's or Bailley's version of the plea arrangement, the uncontradicted evidence shows that no effort was made at Bailey's arraignment to determine which version he understood. The dispute about the plea agreement, which must be adjudicated thirty years after arraignment, demonstrates the fundamental unfairness and the lack of due process in placing upon a prisoner the burden of showing by a preponderance of the evidence the terms of an admittedly secret, extrajudicial proviso that could substantially affect the length of his sentence. A prisoner's liberty should not depend upon the astuteness of his attorney in demanding and preserving written memoranda of a plea agreement or upon the vagaries of human recollection decades after arraignment.
21
The defect in Bailey's arraignment lies in the fact that no one-- court or counsel-- ascertained that Bailey understood the consequences of his plea. Nevertheless, if Bailey in fact understood, the error was harmless. Gundlach v. United States, 262 F.2d 72 (4th Cir. 1958), cert. denied 360 U.S. 904, 79 S. Ct. 1283, 3 L. Ed. 2d 1255 (1959). The state, however, has the burden of proving harmless error. Cf. Munich v. United States, 337 F.2d 356, 360 (9th Cir. 1964).
22
The result does not depend upon the prisoner's subjective testimony alone. The issue is one of fact, which must be resolved by an examination of 'reasonable inferences to be drawn from all the surrounding facts and circumstances.'13 Ordinarily this issue could be decided only in a plenary hearing in the district court, but this rule is not inexorable. Cf. Fields v. Peyton, 375 F.2d 624 (4th Cir. 1967). Counsel for both Bailey and the respondent have assured us that all evidence that can be marshalled is contained in the record. We find the material facts for the determination of this issue to be uncontradicted.
23
Aside from Bailey, the only witnesses who knew about the agreement at the time it was made were the solicitor, the assistant solicitor, and Bailey's attorney. The solicitor never discussed the matter with Bailey and consequently could offer no testimony on this issue. The assistant solicitor testified that at the time of the arraignment he was convinced, barring misbehavior, Bailey would be released after ten years. Thus, he tends to corroborate Bailey. The only witness who actually discussed with Bailey the meaning of the agreement was Bailey's attorney. With regard to Bailey's claim, 'I accepted a life sentence with the distinct understanding that I would be free in ten years,' Bailey's attorney testified, 'He may have understood it that way * * * even though I tried to explain to him the circumstances of it, not being a lawyer and not being familiar with legalities and things of that kind. It's possible that Mr. Bailey felt that that would happen.' This evidence does not establish whether the state's version or Bailey's version of the plea agreement should be accepted. The evidence demonstrates, however, that the state has not carried its burden of provind harmless error by showing Bailey understood what the state claims to be the consequences of his plea.
24
Under familiar principles of due process, a guilty plea cannot be accepted unless the defendant understands its consequences. At the arraignment the court made no effort to ascertain what Bailey understood, either through its own efforts or through counsel, and the state has failed to show this error was harmless. The judgment of the district court is reversed and this case is remanded for the issuance of a writ of habeas corpus. Execution of the writ may be stayed for a reasonable time to permit the State of South Carolina to to retry Bailey if it be so advised.
25
Reversed and remanded.
1
Bailey v. MacDougall, 247 S.C. 1, 145 S.E.2d 425 (1965), cert. denied, 384 U.S. 962, 86 S. Ct. 1589, 16 L. Ed. 2d 674 (1966)
2
Bailey was arrested in North Carolina on a warrant of extradition. On application for habeas corpus, a judge of the Superior Court of North Carolina held that South Carolina had failed to show probable cause for holding Bailey. The Supreme Court of North Carolina affirmed. Ex parte Bailey, 203 N.C. 362, 166 S.E. 165 (1932). The Supreme Court of the United States reversed, holding Bailey had the burden of showing beyond reasonable doubt that he was outside South Carolina. State of South Carolina v. Bailey, 289 U.S. 412, 53 S. Ct. 667, 77 L. Ed. 1292 (1933)
3
In South Carolina, a defendant can plead guilty to murder only before a jury, which, pursuant to the plea, returns a verdict of 'guilty of murder with the recommendation to the mercy of the court.'
4
Bailey urges, 'Constitutional due process cannot be satisfied where the prosecution negotiates a guilty plea knowing it has no other means to obtain a conviction and fails to disclose this fact to either the defendant's counsel or the court.' Bailey did not seek relief on this ground in the state court, and we do not consider it
5
When Bailey was arraigned, the Governor of South Carolina had absolute discretion to grant paroles and pardons. Ten years later, the Governor no longer exercised parole powers, although he could pardon. The Parole Board alone granted paroles
6
After serving about 14 years Bailey escaped to North Carolina and surrendered. Later he escaped to Montana, where he was captured
7
Plea bargaining that induces an innocent person to plead guilty cannot be sanctioned. Negotiation must be limited to the quantum of punishment for an admittedly guilty defendant. Cf. Tabor v. United States, 203 F.2d 948 (4th Cir. 1953), cert. denied, 345 U.S. 1001, 73 S. Ct. 1148, 97 L. Ed. 1407 (1953); Anderson v. State of North Carolina, 221 F. Supp. 930 (W.D.N.C.1963)
A comprehensive review of authorities criticizing or supporting plea bargaining is contained in Commonwealth ex rel. Kerekes v. Maroney, 423 Pa. 337, 223 A.2d 699 (1966). The practice, when restricted by prudent safeguards, is approved in Institute of Judicial Administraction, ABA, Standards Relating to Pleas of Guilty, Part III (tentative draft 1967); Note, Guilty Plea Bargaining: Compromises by Prosecutors to Secure Guilty Pleas, 112 U.Pa.L.Rev. 865 (1964). The practice is criticized in Curlee, Criminal Law and Procedure, 1966-67 Survey of South Carolina Law, 19 S.C.L.Rev. 30, 34 (1967).
8
Bailey v. MacDougall, 247 S.C. 1, 145 S.E.2d 425 (1965), cert. denied, 384 U.S. 962, 86 S. Ct. 1589, 16 L. Ed. 2d 674 (1966)
9
Cf. Shelton v. United States, 356 U.S. 26, 78 S. Ct. 563, 2 L. Ed. 2d 579 (1958), reversing on confession of error 246 F.2d 571 (5th Cir. 1957); Edgerton v. State of North Carolina, 315 F.2d 676 (4th Cir. 1963); United States ex rel. Elksnis v. Gilligan, 256 F. Supp. 244, 253 (S.D.N.Y.1966) (dictum)
10
'Courts have not considered it necessary to inform the defendant of possible collateral consequences when such consequences result from subsequent criminal convictions of the defendant or do not relate directly to the charge to which the defendant pleads guilty.' Note, Guilty Plea Bargaining: Compromises by Prosecutors to Secure Guilty Pleas, 112 U.Pa.L.Rev. 865, 875 (1964)
11
Fed.R.Crim.P. 11, as amended in 1966, requires the court to determine this even though the defendant is represented by counsel. Many states also impose such a duty. Others hold the requirement is satisfied where counsel sufficiently informs the accused. Note, Criminal Procedure-- Duty of the Trial Judge to Advise a Defendant of the Consequences of a Guilty Plea, 19 S.C.L.Rev. 261 (1967), Annot. 97 A.L.R. 2d 549 (1964)
We decline to follow McGrady v. Cunningham, 296 F.2d 600, 96 A.L.R. 2d 1286 (4th Cir. 1961), cert. denied, 369 U.S. 855, 82 S. Ct. 944, 8 L. Ed. 2d 14 (1962). Now, Townsend v. Sain, 372 U.S. 293, 83 S. Ct. 745, 9 L. Ed. 2d 770 (1963), would require a plenary hearing upon the petitioner's allegations.
12
Institute of Judicial Administration, ABA, Standards Relating to Pleas of Guilty 1.5, p. 29 (tentative draft 1967) suggests the plea agreement should be disclosed to the court, and that the court should advise the defendant that recommendations of the prosecutor are not binding on the court
13
United States v. Tateo, 214 F. Supp. 560, 565 (S.D.N.Y.1963) | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/603539/ | 989 F.2d 817
Fed. Sec. L. Rep. P 97,659Hayden McILROY, Plaintiff-Appellant,v.PAINEWEBBER, INCORPORATED, Defendant-Appellee.
No. 91-7126.
United States Court of Appeals,Fifth Circuit.
May 3, 1993.
C. Joseph Giroir, Jr., Bruce W. Claycombe, Giroir & Gregory, Little Rock, AR, for McIlroy.
Hall Estill Hardwick Gable, Mary J. Rounds, Golden & Nelson, John T. Schmidt, Jami JoAnn Campisano, Conners & Winters, Tulsa, OK, for PaineWebber, Inc.
Appeal from the United States District Court for the Northern District of Texas.
Before HILL,* KING and DAVIS, Circuit Judges.
PER CURIAM:
1
Hayden McIlroy, Plaintiff below, appeals the district court's denial of his motion to modify or vacate an arbitration award handed down by an arbitration panel of the National Association of Securities Dealers ("NASD"). McIlroy argues that the district court erred in failing to modify or vacate the award under the Federal Arbitration Act, 9 U.S.C. § 1 et seq. ("Arbitration Act"), and that it erred in excluding his submission of supplemental authority. For the reasons that follow, we affirm.
I. Facts
2
Appellant McIlroy, an experienced investor, purchased 40,000 shares of stock in Sooner Federal Savings & Loan Association ("Sooner") in 1987, through a broker at the Tulsa, Oklahoma office of Kidder, Peabody & Company. In March, 1988, Appellee PaineWebber, Incorporated ("PaineWebber") took over Kidder Peabody's Tulsa office and McIlroy became a PaineWebber client.
3
In June, 1988, after Sooner had reported several quarterly losses, McIlroy informed his PaineWebber broker, F. Stephen Allen, that he wanted to sell his Sooner stock, if possible without taking a discount on the price. Allen reminded McIlroy that Sooner stock was held by only a few investors and was, in consequence, difficult to sell. McIlroy did not enter a formal sell order and Allen did not locate a buyer for the stock.
4
In September, 1988, Allen informed McIlroy that another Sooner shareholder was preparing to sell a substantial amount of stock. Such a sale would force short sellers of Sooner stock to cover, driving the stock price up and allowing McIlroy to liquidate his shares at a favorable price. McIlroy purchased an additional 10,000 shares but the stock sale never occurred. In October, 1988, McIlroy again asked Allen to sell his Sooner shares.
5
In November, 1988, some short sellers of Sooner stock entered the market. PaineWebber sold them 47,397 shares, and then an additional 1,600 shares, out of its own inventory, for a total price of $893,395.25. Allen assured McIlroy that he would sell McIlroy's stock in the next short cover transaction, which he believed would occur immediately. No short cover transactions occurred in November or December, 1988, and Sooner stock declined precipitously in value. In November, 1989, the Federal Savings and Loan Insurance Corporation placed Sooner into receivership. PaineWebber eventually sold McIlroy's stock at a price which left a $70,000.00 deficit in his trading account.
6
McIlroy submitted a claim for $1,033,750.00 in damages and costs to the National Association of Securities Dealers. PaineWebber counterclaimed for the deficit in McIlroy's account and moved to dismiss McIlroy's claim. After a hearing, a NASD arbitration panel found PaineWebber liable and awarded McIlroy $40,875.00. The panel dismissed PaineWebber's counterclaim and ordered each party to bear its own costs.
7
McIlroy filed a motion in Texas state court seeking either an upward modification of the award to $911,323.881 or vacation of the award. PaineWebber removed the action to federal court. While the motion was pending, McIlroy submitted to the court a letter and supplemental caselaw dealing with modification of arbitration awards. PaineWebber moved to strike the documents on the basis that McIlroy had not complied with local filing rules. The court granted PaineWebber's motion to strike and ruled on the merits that McIlroy failed to meet any of the grounds for modification or vacation of an award specified in the Arbitration Act. McIlroy filed this appeal.
II. Discussion
8
We review de novo the district court's order denying McIlroy's motion to vacate or modify Forsythe Int'l, S.A. v. Gibbs Oil Co., 915 F.2d 1017, 1020 (5th Cir.1990). Contrary to Petitioner's suggestion, this de novo review does not leave us "free to correct the arbitration award" App.Br. at 10; rather, it is intended to reinforce the strong deference due an arbitrative tribunal. Forsythe, supra at 1021 ("In the arbitration context, granting the deference ordinarily due the district court risks forgetting the prior and critical deference due the findings of the arbitration panel."). Mindful of the limitations on our review of the arbitration award itself, we consider each of McIlroy's arguments in turn.
A. Vacation
9
Title 9 U.S.C. § 10(a) provides that a district court may vacate an award:
10
(1) Where the award was procured by corruption, fraud or undue means.
11
(2) Where there was evident partiality or corruption in the arbitrators....
12
(3) Where the arbitrators were guilty of misconduct in refusing to postpone the hearing ... or in refusing to hear evidence pertinent and material to the controversy; or of any other misbehavior by which the rights of any party have been prejudiced.
13
(4) Where the arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final and definite award upon the subject matter was not made.
14
9 U.S.C. § 10(a).
15
In this circuit, section 10 of the Arbitration Act describes the only grounds upon which a reviewing court may vacate an arbitration award. R.M. Perez & Associates, Inc. v. Welch, 960 F.2d 534 (5th Cir.1992); accord Robbins v. Day, 954 F.2d 679 (11th Cir.1992).2
16
McIlroy urged the district court to vacate the arbitration award on grounds that the award "was the product of such gross mistake as to imply failure to exercise honest judgment." D.Ct. Op. at 5. He offered no evidence of a "gross mistake" save the discrepancy between his claim and the panel's award. Without deciding whether McIlroy's allegation was true, the district court found that he failed to meet any of the grounds for attacking an award listed in section 10 and denied the motion. We agree with the district court that McIlroy's allegations, standing alone, do not entitle him to vacation of the award under section 10 of the Arbitration Act.
B. Modification
17
Section 11 of the Arbitration Act governs judicial modification of arbitration awards and provides, in relevant part:
18
[The] court ... may make an order modifying or correcting [an] award upon the application of any party to the arbitration--
19
(a) Where there was an evident material miscalculation of figures or an evident material mistake in the description of any person, thing or property referred to in the award.
20
(b) Where the arbitrators have awarded upon a matter not submitted to them, unless it is a matter not affecting the merits of the decision upon the matter submitted.
21
(c) Where the award is imperfect in matter of form not affecting the merits of the controversy.
22
The order may modify and correct the award, so as to effect the intent thereof and promote justice between the parties.
23
9 U.S.C. § 11.
24
McIlroy argued below that the panel had committed an "evident material miscalculation" under 11(a) because it was "impossible to calculate damages of only $40,875.00 arising out of the evidence presented at the hearing." The district court declined to modify the award "absent a specific showing of miscalculation of figures." D.Ct.Op. at 6.
25
In our recent decision in Valentine Sugars, Inc. v. Donau Corp., 981 F.2d 210 (5th Cir.1993), we adopted from the Sixth Circuit the following definition of an "evident material miscalculation" under section 11:
26
"[W]here the record that was before the arbitrator demonstrates an unambiguous and undisputed mistake of fact and the record demonstrates strong reliance on that mistake by the arbitrator in making his award, it can fairly be said that the arbitrator 'exceeded [his] powers....' " National Post Office v. United States Postal Service, 751 F.2d 834, 843 (6th Cir.1985). We interpret the term "undisputed" to mean we should look to see whether there is any rational basis for disputing the truth of the fact. (citations omitted).
27
981 F.2d at 214.
28
On appeal, McIlroy offers no support for his contention that the arbitration panel committed an "evident miscalculation" except to point again to the discrepancy between the award he requested and the one he received. Receipt of less than one requests in an arbitration proceeding does not, standing alone, constitute a miscalculation under section 11 of the Arbitration Act. See, e.g., Merrill, Lynch, Pierce, Fenner & Smith, Inc. v. Burke, 741 F. Supp. 191, 193 (N.D.Cal.1990).
29
The arbitration panel did not explain the rationale behind its award but it was not required to do so. Antwine v. Prudential-Bache Securities, Inc., 899 F.2d 410, 412 (5th Cir.1990). The panel did list McIlroy's allegations, which included breach of duty, failure to execute a sell order, violation of federal and state securities laws, and breach of contract. The panel also noted PaineWebber's counterclaim for the balance owing on McIlroy's brokerage account. During two days of hearings, the panel heard PaineWebber's contentions that McIlroy's calculation of damages was speculative and that McIlroy had failed to mitigate his losses. Accordingly, the panel had several grounds upon which to base an award in McIlroy's favor and a wealth of data from which to calculate an appropriate award. We find no miscalculation evident in this record. As the Eleventh Circuit has remarked: "When ... parties agree[ ] to arbitration, they agree[ ] to accept whatever reasonable uncertainties might arise from the process," Raiford v. Merrill, Lynch, Pierce, Fenner & Smith, Inc., 903 F.2d 1410, 1413 (11th Cir.1990). The size of an award is one such uncertainty, and a claimant's dissatisfaction alone will not support judicial modification of that award. We affirm the district court's denial of McIlroy's motion to vacate or modify the award.
C. Excluded Material
30
While McIlroy's motion was pending before the district court, he sent the judge, under a cover letter, a copy of new and arguably relevant caselaw. Local Rule 2.1(b) of the United States District Court for the Northern District of Texas concerns the form and filing of legal documents and provides that "all legal documents except discovery materials shall be filed directly with the Clerk's office for the appropriate Division and shall not be sent directly to the Judge for filing." Rule 2.1(b). "Legal document" is broadly defined in Rule 2.1(a) to include "every pleading, petition, application, motion, brief, notice, demand, offer, request, proposed order, and any other paper to be made a part of the record in any civil or criminal case." Rule 2.1(a). PaineWebber moved to strike McIlroy's submission for failure to comply with Rule 2.1(b). Concerned that the submission included new legal argument, the district judge granted PaineWebber's motion. McIlroy argues that the court erred in characterizing the submission as a legal document and in failing to accept and consider it.
31
We note, parenthetically, that the opinion at issue was subsequently reversed, such that prejudice to McIlroy is doubtful at best. In any event, we are satisfied that the district court acted well within its discretion in excluding the material.
32
For the foregoing reasons, we AFFIRM the judgment of the district court.
*
Circuit Judge of the Eleventh Circuit, sitting by designation
1
McIlroy apparently arrived at this figure by multiplying 50,000 shares by the price per share PaineWebber received in the sale
2
Other jurisdictions have vacated arbitration awards for reasons independent of the grounds specified in section 10 of the Arbitration Act; for example, where an award is made in "manifest disregard of the law" or where it is "completely irrational" or "unfounded in reason and fact". See, respectively, Merrill, Lynch, Pierce, Fenner & Smith Inc. v. Bobker, 808 F.2d 930, 933 (2d Cir.1986); French v. Merrill, Lynch, Pierce, Fenner & Smith Inc., 784 F.2d 902, 906 (9th Cir.1986); Bettencourt v. Boston Edison Co., 560 F.2d 1045, 1050 (1st Cir.1977). At the time McIlroy filed this appeal, the applicability of this line of cases in the Fifth Circuit was unclear. During the pendency of the appeal, we declined to adopt "manifest disregard", or any other standard, as an addendum to section 10. Perez, supra. Consequently, we disregard McIlroy's arguments to the extent that they rely upon standards of review outside the scope of the Arbitration Act | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1031676/ | UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 09-4099
UNITED STATES OF AMERICA,
Plaintiff - Appellee,
v.
ERIK DEHLINGER,
Defendant - Appellant.
Appeal from the United States District Court for the District of
South Carolina, at Florence. Terry L. Wooten, District Judge.
(4:06-cr-00900-TLW-1)
Argued: January 29, 2010 Decided: March 5, 2010
Before MOTZ, GREGORY, and DAVIS, Circuit Judges.
Affirmed by unpublished per curiam opinion.
ARGUED: Michael Louis Minns, Rain Levy Minns, THE MINNS LAW
FIRM, Houston, Texas, for Appellant. Gregory Victor Davis,
UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for
Appellee. ON BRIEF: Ashley Blair Arnett, THE MINNS LAW FIRM,
Houston, Texas; John M. Ervin, III, LAW OFFICE OF JOHN M. ERVIN,
III, Darlington, South Carolina, for Appellant. John DiCicco,
Acting Assistant Attorney General, Alan Hechtkopf, Tax Division,
UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C.; W. Walter
Wilkins, United States Attorney, Columbia, South Carolina, for
Appellee.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
On August 22, 2006, Dr. Erik Dehlinger (“Dehlinger”) was
indicted in the United States District Court for the District of
South Carolina on one count of conspiracy to defraud the United
States in violation of 18 U.S.C. § 371 and three counts of
willfully filing false income tax returns in violation of 26
U.S.C. § 7206. The matter proceeded to trial and a jury found
Dehlinger not guilty on the conspiracy charge and guilty as to
the three tax evasion charges. On January 29, 2009, Dehlinger
was sentenced to 42 months imprisonment. He now appeals his
conviction and sentence. We affirm.
I.
From 1997 to 2002, Dehlinger was an emergency room doctor
at McLeod Hospital in Florence, South Carolina. In 1997 and
1998, Dehlinger engaged the services of Hoyt Wayne Terry
(“Terry”), a certified public accountant, to prepare his income
tax returns. In 1998, Terry calculated Dehlinger’s adjusted
gross income to be $301,091, with an income tax liability of
$85,188, and self-employment taxes of $16,342. Dehlinger had
previously paid $49,510 of his tax liability and therefore owed
an additional $52,200 to the Internal Revenue Service (“IRS”).
Unbeknownst to Terry, however, Dehlinger never filed this, or
the previous year’s, tax return. In neither of these years did
2
Dehlinger report any financial information to Terry regarding a
partnership or subchapter S corporation in which he had an
interest.
Dehlinger claimed that his good fortune in avoiding the
above-described tax liability resulted from his introduction by
his co-worker, Dr. Raghavan Chari, to the Anderson’s Ark and
Associates’ (“AAA”) programs. AAA purported to serve as a tax,
retirement planning, and investment company based in Costa Rica.
AAA sold audiotapes and books and conducted seminars, providing
advice on how to, allegedly legally, avoid personal income tax
liabilities. In March 1999, Dehlinger purchased an AAA audiotape
series entitled “Gateway to Financial Freedom,” delivered by
Guardian Management, an AAA affiliate.
Following this initial purchase, Dehlinger used several
other programs marketed by AAA, including both the “Look Back”
and “Look Forward” series. AAA and Guardian Management designed
“Look Back” to enable its users to both avoid tax liabilities
for the current year and also to “recapture” taxes paid in the
two years prior to usage of the program. Under the “Look Back”
program, a user would create a partnership with an AAA affiliate
such that the customer held a 95% interest and the AAA affiliate
held the remaining five percent interest. AAA would arrange for
an entity known as “La Maquina Blanca” to make a loan directly
to the AAA affiliate minority partner, in exchange for the
3
client’s execution of a promissory note. The partnership would
then use the loan funds to make a guaranteed payment to the AAA
affiliate minority partner, allegedly for consulting and
marketing services. In accordance with Section 707(c) of the
Internal Revenue Code, a guaranteed payment to a partner for the
performance of services constitutes a deductible ordinary
business expense on the partnership’s tax returns. 26 U.S.C. §
707(c). Because the partnership created by AAA reported zero or
at most minimal income, the guaranteed payment resulted in a net
loss for the partnership, which would then pass through to each
of the partners in proportion to their ownership interests. The
partners could use the loss to avoid paying taxes for the
current year and to “recapture” taxes paid for the two preceding
years.
In contrast to the “Look Back” program, the “Look Forward”
program sought to avoid current income tax liability. Under the
plan, AAA created a limited liability corporation (“LLC”) for
each client. The partnership created through the “Look Back”
program would provide consulting services to the LLC. The LLC
would then make a “consulting fee” payment to the partnership’s
bank account, over which the client had sole control. Again, the
losses would “pass-through” to the client, resulting in losses
on his or her income tax returns.
4
In reality, neither of these programs operated as it was
purported to operate. Baton Venture, the partnership AAA created
for Dehlinger as a part of the “Look Back” program, allegedly
received a loan from La Maquina Blanca of $650,000 in time to
make a guaranteed payment in that amount to Mason Advertising,
the AAA-created minority partner, by December 30, 1998. In fact,
Dehlinger neither signed the promissory note nor paid the loan
fees until March 1999, both prerequisites for the funding of the
loan, according to the note. Rather, Dehlinger backdated his
signature to December 20, 1998. In addition, Dehlinger never
made a payment on the loan or granted the creditor a security
interest even though he signed both the loan agreement and
promissory note. Finally, despite claiming a partnership loss of
$646,594 because of the guaranteed payment, there is no record
of such a payment made to Mason Advertising.
All in all, the partnership losses translated to a negative
$335,167 adjusted gross income for Dehlinger in 1998 and a
refund of nearly $45,000 when computed by the Guardian
Management Company. Dehlinger filed a Form 1045 in that year,
prepared by George Benoit (“Benoit”), a Guardian Management
employee. This return sought refunds of $34,135 and $34,442 for
taxes paid in 1996 and 1997. Dehlinger filed this return rather
than the one Terry had previously prepared. Dehlinger’s 1999
Form 1040, also prepared by Benoit, reported an income of
5
$240,164 from his medical practice. Again, however, Dehlinger
reported no taxable income and no tax liability. On his 2000
Form 1040, Dehlinger again reported no taxable income and no tax
liability. Dehlinger reported a partnership loss of $242,670 due
to a $250,000 guaranteed payment to Mason Advertising, resulting
in no tax liability despite an income from his medical practice
of $240,164. In February 2002, Dehlinger used an AAA-affiliated
CPA, Tara LaGrand (“LaGrand”), to prepare his 2001 tax returns.
LaGrand also amended Dehlinger’s 2000 tax return, using the
“Look Back” program to recapture taxes already paid.
On August 22, 2006, a grand jury sitting in the District of
South Carolina returned a four-count indictment charging
Dehlinger with one count of conspiracy to defraud the United
States, in violation of 18 U.S.C. § 371, and three counts of
making and subscribing a false return, in violation of 26 U.S.C.
§ 7206(1). Dehlinger pled not guilty on all counts.
At trial, Dehlinger testified on his own behalf, claiming
that Dr. Chari had convinced him that the programs sold by AAA
were legitimate means of avoiding income taxes. Dehlinger denied
knowing that the various components of the program were
illegitimate. He claimed that at the time he filed the returns,
he did not believe that he was committing fraud by taking
deductions related to the AAA programs. He also asserted that he
relied on his tax return preparers and the AAA principals,
6
including LaGrand, in filing the returns that reported zero tax
due and owed.
Following a five-day jury trial, the jury convicted
Dehlinger on three counts of making and subscribing a false
return, and acquitted him on the conspiracy to defraud count. On
January 7, 2009, the district court sentenced Dehlinger to 42
months’ incarceration, to be followed by one year of supervised
release. The court also ordered him to pay restitution of
$363,207, a fine of $5,000, and a $300 special assessment.
II.
Dehlinger challenges his conviction principally on the
ground of ineffective assistance of counsel, claiming that his
attorney had a conflict of interest that impaired his
representation of Dehlinger. Dehlinger also challenges the
district court’s (1) denial of his motion for a mistrial after a
witness volunteered testimony previously ruled to be
inadmissible hearsay; (2) admission of testimony from an
undercover IRS agent regarding his experience with AAA programs;
and (3) calculation of his base offense level and imposition of
a sentencing guidelines enhancement for obstruction of justice.
We address these issues in turn.
7
A.
Whether defendant’s trial counsel had a conflict of
interest presents a mixed question of law and fact, reviewed de
novo by this court. See Mickens v. Taylor, 240 F.3d 348, 360
(4th Cir. 2001) (en banc), aff’d, 535 U.S. 162 (2002); Williams
v. French, 146 F.3d 203, 212 (4th Cir. 1998).
This court considers ineffective assistance claims on
direct appeal only if it “‘conclusively appears’ from the record
that defense counsel did not provide effective representation.”
United States v. Gastiaburo, 16 F.3d 582, 590 (4th Cir. 1994)
(citations omitted); United States v. Baldovinos, 434 F.3d 233,
239 (4th Cir. 2006); United States v. Richardson, 195 F.3d 192,
198 (4th Cir. 1999); United States v. King, 263 Fed. App’x 332,
333 (4th Cir. 2008). The reason for this restriction is that,
generally, a motion under 28 U.S.C. § 2255 in the district court
is preferable than direct appeal, so that the parties may
adequately develop the record. Gastiaburo, 16 F.3d at 590
(citations omitted); United States v. King, 119 F.3d 290, 295
(4th Cir. 1997).
The Supreme Court has held that criminal defendants have a
Sixth Amendment right to conflict-free representation by
counsel. Cuyler v. Sullivan, 446 U.S. 335, 345-50 (1980);
Holloway v. Arkansas, 435 U.S. 475 (1978). A defendant seeking a
new trial must show “‘some real conflict of interest . . .
8
resulting from [overlapping] representation [of two clients]’”
to succeed on this Sixth Amendment claim. United States v.
Atkinson, 565 F.2d 1283, 1284 (4th Cir. 1977) (quoting United
States v. Lovano, 420 F.2d 769, 772 (2d Cir. 1970)). The mere
fact of overlapping representation is insufficient to create a
Sixth Amendment violation. See id. Rather, a defendant must
establish that (1) his attorney labored under “an actual
conflict of interest” that (2) “adversely affected his lawyer's
performance.” Sullivan, 446 U.S. at 348; Strickland v.
Washington, 466 U.S. 668, 691-92 (1984); United States v. Stitt,
552 F.3d 345, 350 (4th Cir. 2008), cert. denied, 130 S. Ct. 65
(2009); United States v. Tatum, 943 F.2d 370, 375 (4th Cir.
1991).
Dehlinger claims that his attorney, Scott Engelhard, Esq.
(“Engelhard”) had a conflict that arose from the latter’s
representation of him, LaGrand (the AAA-affiliated CPA who
prepared his 2001 tax returns and amended his 2000 tax returns),
and Collis Redd (“Redd”), an AAA tax planner. According to
Dehlinger, Engelhard refused to call LaGrand as a witness during
his trial, even though LaGrand could have offered exculpatory
9
evidence, because Engelhard’s loyalties were divided between the
two clients. 1
Here, although Dehlinger raises more than a colorable claim
that Engelhard’s loyalties were impermissibly divided, a review
of the record shows that the facts are not conclusive. It is not
for this court to determine the character, duration, and extent
of Engelhard’s representation of Dehlinger, LaGrand, and Redd,
in the first instance, and whether his representation of these
individuals created actual conflict that adversely affected his
representation of Dehlinger. Indeed, we decline to comment on
these issues. Although, at Dehlinger’s insistence, the district
court conducted limited, non-evidentiary post-verdict
proceedings to examine Dehlinger’s allegations against
Englehard, we agree with the court’s conclusion that the facts
and circumstances presented by this record should be evaluated
by a district judge acting on an adequate factual record in an
orderly post-conviction proceeding rather than on the basis of
dueling affidavits and declarations. Accordingly, we hold that
Dehlinger has not “conclusively” established the existence of an
1
According to Dehlinger, LaGrand could have testified that
her clients, Dehlinger included, believed that AAA’s tax
strategies were legal. Ostensibly, LaGrand’s testimony would
have contradicted the government’s evidence of Dehlinger’s
willful violation of the tax laws. Dehlinger further argues that
LaGrand’s testimony previously exculpated defendants in related
and similar prosecutions in other federal districts.
10
actual conflict of interest that adversely affected Engelhard’s
representation of Dehlinger. 2
B.
We review a district court’s refusal to grant a mistrial
for abuse of discretion. United States v. West, 877 F.2d 281,
287-88 (4th Cir. 1989). An abuse of discretion is found “only
under the most extraordinary of circumstances” and requires that
a defendant have experienced prejudice. United States v.
Dorlouis, 107 F.3d 248, 257 (4th Cir. 1997). A defendant cannot
prove prejudice if a jury “could make individual guilt
determinations by . . . appraising the independent evidence
against each defendant,” but rather this court must find that
there is a “reasonable possibility” that the error influenced
the jury’s verdict. United States v. Porter, 821 F.2d 968, 972
(4th Cir. 1987); United States v. Seeright, 978 F.2d 842, 849
(4th Cir. 1992). A district court can generally prevent
prejudice to a defendant by “a cautionary or limiting
instruction, particularly if the danger of prejudice is slight
in view of the overwhelming evidence of guilt.” United States
v. Ham, 998 F.2d 1247, 1254 (4th Cir. 1993) (quoting United
States v. Masters, 622 F.2d 83, 87 (4th Cir. 1980); see also
2
In light of our holding, we deny Dehlinger’s motion to
file a supplemental brief.
11
United States v. Johnson, 610 F.2d 194, 196-97 (4th Cir. 1979)
(“The general rule is that if evidence which may have been taken
in the course of a trial be withdrawn from the consideration of
the jury by the direction of the presiding judge, that such
direction cures any error which may have been committed by its
introduction.”).
Here, the district court did not abuse its discretion in
denying Dehlinger’s motion for a mistrial after William Cauthen,
Jr. (“Cauthen”) offered testimony that the court had previously
deemed inadmissible and subsequently ordered stricken. The
district court had ruled that Cauthen could not characterize
anything on the AAA website as “right wing or fringe.” In
response to the prosecutor’s inquiry of his “impression of the
information that [he] saw on the AAA website,” however, Cauthen
stated that he “thought the information that I saw there was
sort of fringe material, right wing material, and that
potentially it could be fraud.” Upon Dehlinger’s objection and
motion for a mistrial, the district court ordered the statement
stricken from the record. The district court refused to grant a
mistrial. During final instructions the district court reminded
the jury that “if any evidence was stricken from the record,
[they] should not consider that evidence in making [their]
decision.”
12
Cauthen’s statement was one line in a four-day trial
replete with evidence establishing Dehlinger’s guilt, including
signed fraudulent tax returns. The district court quickly
ordered the statement stricken and, before deliberations,
reminded the jury not to consider such evidence. See United
States v. Harris, 165 F.3d 1062, 1066 (6th Cir. 1999) (affirming
the district court’s denial of a motion for mistrial after a
brief reference to a prior arrest where “the district court gave
an immediate and clear limiting instruction”); Black v. Shultz,
530 F.3d 702, 707 (8th Cir. 2008) (affirming the district
court’s refusal to grant a mistrial given the fact that the
court “gave a curative instruction” after a single statement was
made in violation of the court’s order). And although Dehlinger
claims before us that the statement was devastating to his
defense, he does not state how the statement made about the AAA
website prejudiced him or what impact it likely had on the
jury’s determination of his guilt. See United States v.
Baumgarten, 517 F.2d 1020, 1030 (8th Cir. 1975) (denying
defendant’s motion for a mistrial where witness’ brief reference
to defendant’s previous arrest was “of very little
significance”); United States v. Butler, 71 F.3d 243, 255 (7th
Cir. 1995) (holding that a prosecutor’s lone comment did not
warrant a mistrial as it “was a single, isolated, indirect
remark”).
13
C.
The decision whether to admit evidence is properly within a
district court’s discretion; thus, we review a district court’s
admission of evidence for abuse of discretion. United States v.
Hodge, 354 F.3d 305, 312 (4th Cir. 2004); United States v.
Lancaster, 96 F.3d 734, 744 (4th Cir. 1996). A district court
abuses its discretion “only when it can be said that [it] acted
arbitrarily or irrationally in admitting evidence,” something
that occurs only under “the most extraordinary of
circumstances.” United States v. Williams, 445 F.3d 724, 732
(4th Cir. 2006) (citing United States v. Simpson, 910 F.2d 154,
157 (4th Cir. 1990)); see also United States v. Heater, 63 F.3d
311, 325 (4th Cir. 1995) (“[I]n order to find a district court's
error harmless, we need only be able to say ‘with fair
assurance, after pondering all that happened without stripping
the erroneous action from the whole, that the judgment was not
substantially swayed by the error.’”) (quoting United States v.
Nyman, 649 F.2d 208, 211–12 (4th Cir. 1980)).
1.
Fed. R. Evid. 701 allows lay witnesses to express opinions
that are “(a) rationally based on the perception of the witness,
(b) helpful to a clear understanding of the witness' testimony
or the determination of a fact in issue, and not based on
scientific, technical, or other specialized knowledge within the
14
scope of [expert testimony].” In addition, courts have held
that lay testimony generally requires that the opinion offered
be “the product of reasoning processes familiar to the average
person.” See United States v. Garcia, 413 F.3d 201, 215 (2d.
Cir. 2005); United States v. Cooks, 589 F.3d 173, 180 (5th Cir.
2009).
Dehlinger argues that the district court impermissibly
allowed lay witnesses to offer “expert testimony” designed to
show that he possessed a guilty state of mind during his
interactions with AAA. At trial, the district court permitted
Cauthen to offer testimony about the AAA website. As just
discussed, however, the court ordered testimony characterizing
the website as “fringe,” stricken from the record and instructed
the jury to disregard it. The court also permitted Special Agent
Mike Preiss, who conducted an undercover investigation into the
operation of AAA, to testify about investors’ relationships with
AAA, specifically focusing on Dehlinger. In permitting such
testimony, the court reasoned that the testimony would “provide
some evidence for the jury to consider in terms of what actually
went on at [AAA] and what the process was.” As a witness, Preiss
compared the partnership documents AAA sent him while he was
undercover with those that Dehlinger had obtained from AAA and
testified to his understanding of how the AAA programs worked,
and specifically, that he was to receive about $300,000 in tax
15
savings. Preiss also noted the existence of similar statements
about tax benefits in an executive summary AAA sent to
Dehlinger. Preiss further discussed and compared plan documents
that he had received from AAA with those Dehlinger had in his
possession. To his knowledge, Preiss indicated that the
partnerships and companies created by AAA conducted no business
of their own, as indicated in their income tax returns which
listed no gross income or receipts and included only minimal
expenditures, other than the guaranteed payment at issue. And
even though the partnership agreement explicitly set out the
various responsibilities of each partner to the agreement, the
partners never performed any of these duties. Priess testified
that, based on his experience with AAA, he was not obligated to
repay the loan for which he had cosigned and that was
subsequently used to fund the guaranteed payment to his AAA-
affiliated partner.
Dehlinger claims that Cauthen’s and Preiss’s testimony
amounted to impermissible expert testimony because their
statements demonstrate that Dehlinger knew the information on
the AAA website was illegitimate and that Dehlinger had the same
guilty state of mind as Preiss did during his interactions with
AAA, respectively. This argument fails. The testimony at issue
in this case is not, in either purpose or effect, that of an
expert. Both witnesses merely offered their opinion of their
16
individual experiences with AAA, making deductions and drawing
inferences that an “average person” would similarly be capable
of in an identical situation. Neither Cauthen nor Priess
testified about Dehlinger’s mental state or whether he knowingly
violated the tax laws. Cauthen limited his statements only to
his personal impressions of the AAA website, which were later
stricken, as previously discussed. Preiss’s testimony was
restricted to his own knowledge of, and experience with, AAA. He
offered his personal impressions of AAA and the similarities
inherent in the documents AAA provided to him and those
Dehlinger received. He did not, as Dehlinger would have us
believe, proffer testimony suggesting that Dehlinger himself
possessed a felonious intent. He never testified or even hinted
that, because he believed AAA’s programs were illegal, Dehlinger
must have believed they were illegal as well. In short, neither
Cauthen nor Priess testified to the ultimate issue of
Dehlinger’s willfulness as an expert witness would have.
2.
Where admission of lay testimony is challenged as bordering
on expert opinion, testimony that has no direct effect upon
proof of the elements of the substantive offenses charged, will
not be overturned, particularly if there is sufficient evidence
elsewhere in the record upon which the jury could have found the
defendant guilty. See Fed. R. Crim. P. 52(b)).
17
Dehlinger was found guilty of three counts of willfully
filing false income tax returns. One of the elements proved by
the government was that Dehlinger voluntarily and intentionally
violated a known legal duty. Cheek v. United States, 498 U.S.
192, 201 (1991). Even discounting Priess’s testimony, there was
sufficient evidence of willfulness. For instance, the government
presented evidence that, in 1998, Dehlinger had accurate Form
1040s prepared by Terry. Dehlinger, however, did not file this
form or inform Terry that this form was incorrect. Rather,
Dehlinger signed and filed a tax return that claimed a refund of
all taxes paid to a AAA partner. This evidence shows that
Dehlinger knowingly filed fraudulent tax returns. See United
States v. Mohney, 949 F.2d 1397, 1407 (6th Cir. 1991) (“A
taxpayer’s signature on a return does not in itself prove his
knowledge of the contents, but knowledge may be inferred from
the signature along with the surrounding facts and
circumstances, and the signature is prima facie evidence that
the signer knows the contents of the return.”) (citing United
States v. Harper, 458 F.2d 891, 894 (7th Cir. 1971)); United
States v. Drape, 668 F.2d 22, 26 (1st Cir. 1982) (holding that a
defendant’s signature is sufficient to establish knowledge once
it has been shown that the return was false). The district court
did not abuse its discretion in refusing to grant a mistrial.
18
D.
We review a district court’s interpretation of the
Sentencing Guidelines de novo and its factual findings for clear
error. United States v. Osborne, 514 F.3d 377, 387 (4th Cir.
2008), cert. denied, 128 S. Ct. 2525 (2008); United States v.
Daughtrey, 874 F.2d 213, 217-18 (4th Cir. 1989). If a defendant
fails to raise a timely objection during sentencing, however, we
review the district court’s actions for plain error. See United
States v. Olano, 507 U.S. 725, 731-32 (1993); United States v.
Uzenski, 434 F.3d 690, 711 (4th Cir. 2006); United States v.
Lynn, Nos. 08-5125, 08-5126, 08-5132, 09-4341, _ F.3d _, 2010 WL
322176 (4th Cir. Jan. 28, 2010).
Dehlinger claims that the district court improperly
sentenced him when it (1) took into account three years of tax
losses for which he was not indicted or convicted and (2)
increased his offense level by two levels for obstruction of
justice. As to the former issue, the district court properly
took into account three years of tax losses for which Dehlinger
was not indicted in calculating his base offense level. When an
offense involves tax evasion or filing fraudulent tax returns,
the Sentencing Guidelines calculates a defendant’s base offense
level on the attempted tax loss, defined as “the total amount of
loss that was the object of the offense.” U.S.S.G. §
2T1.1(c)(1); United States v. Delfino, 510 F.3d 468, 472 (4th
19
Cir. 2007). Tax loss is loss attributable to the offense of
conviction and any other loss due to relevant conduct, including
“all acts and omissions committed, aided, abetted, counseled,
commanded, induced, procured, or willfully caused by the
defendant . . . that occurred during the commission of the
offense of conviction, in preparation for that offense, or in
the course of attempting to avoid detection or responsibility
for that offense,” U.S.S.G. § 1B1.3(a)(1), and all such acts and
omissions that were part of the same course of conduct or common
scheme or plan as the offense of conviction, U.S.S.G. §
1B1.3(a)(2). “[A]ll conduct violating the tax laws should be
considered as part of the same course of conduct or common
scheme or plan unless the evidence demonstrates that the conduct
is clearly unrelated.” U.S.S.G. § 2T1.1 comment (n.2); United
States v. Ervasti, 201 F.3d 1029, 1042 (8th Cir. 2000).
Here, the presentence investigation report recommended a
tax loss of $363,207, which included tax loss for the six-year
period from 1996 to 2001. During sentencing, Dehlinger did not
object to the very inclusion of tax losses from 1996, 1997, and
1998. Rather, Dehlinger objected to the inclusion of those tax
losses only to the extent that they did not reflect deductions
to which he may have been entitled. The district court did not
err in overruling Dehlinger’s objection and including tax losses
from 1996 to 1998 because it was shown at trial that Dehlinger
20
used the same AAA programs and made the same types of deductions
in those three years as the subsequent three years for which he
was indicted and convicted. See Ervasti, 201 F.3d at 1042 (using
"fraud loss," which defendant conceded to be $5,747,478.88,
rather than "tax loss," to which she did not “ascribe a precise
value,” as the basis for calculating the base offense level in a
mail fraud case in which the defendant misappropriated impounded
tax monies from clients of their payroll processing
corporation); see also United States v. Hayes, 322 F.3d 792,
801-02 (4th Cir. 2003) (vacating a sentence because the district
court did not consider all relevant evidence in determining the
applicable tax loss).
As to the second of Dehlinger’s sentencing issues, the
district court did not err in increasing Dehlinger’s offense
level by two levels for obstruction of justice. The Sentencing
Guidelines allow a two level increase if “the defendant
willfully obstructed or impeded, or attempted to obstruct or
impede, the administration of justice with respect to the
investigation, prosecution, or sentencing of the instant offense
of conviction and any relevant conduct.” U.S.S.G. § 3C1.1;
United States v. Puckett, 61 F.3d 1092, 1095 (4th Cir. 1995).
Obstruction of justice includes committing perjury at trial.
U.S.S.G. § 3C1.1, comment (n.4(b)). A district court applying an
enhancement based on obstruction of justice must necessarily
21
find, by a preponderance of the evidence, that the defendant (1)
gave false testimony, (2) concerning a material matter, (3) with
the willful intent to deceive while under oath. United States v.
Dunnigan, 507 U.S. 87, 92-98 (1993); United States v. Sun, 278
F.3d 302, 314 (4th Cir. 2002) (citing United States v. Smith, 62
F.3d 641, 646 (4th Cir. 1995)).
The district court found that Dehlinger committed perjury
when he testified (extensively) under oath that he relied on
others, taking advice from his accountant and financial planner,
as well as Dr. Chari, regarding the legality and soundness of
the AAA programs. Specifically, Dehlinger claimed that he took
certain deductions “because Richard Marks and George Benoit said
they were appropriate deductions.” Tr. 108. As an initial
matter, the district court’s enhancement for perjury did not
constitute double counting (even though Dehlinger’s crime
constituted lying to the IRS) because the crime for which he was
convicted was completed by the time he went on trial. Indeed,
his crime was complete after he had filed the fraudulent tax
returns. Lying under oath constitutes a new and different
circumstance designed to hide the already completed crime. In
short, the conduct underlying Dehlinger’s conviction is
different from the conduct upon which the district court based
its enhancement.
22
Second, the district court properly reasoned that, since
the jury found Dehlinger guilty of all tax evasion charges, it
must have rejected all of his testimony regarding good faith and
lack of willfulness. During sentencing, the district court
discussed at length its reasons for enhancing Dehlinger’s
sentence; namely, that Dehlinger (1) gave false testimony, (2)
concerning a material matter, (3) with the willful intent to
deceive while under oath. The district court said,
[Defendant’s] testimony was to say, if it is
detrimental reliance, if that is the description, the
proper description, it may well be; but it was more
specific about what was going on, what I did and,
gosh, I really did not know that this was not on the
up and up. And it seems that the jury evaluated that
testimony and the jury found the defendant guilty and
ignored that testimony altogether. . . .
But [defendant] was very specific about what he had
done and the fact that it was not bad motive or
criminal intent by him; but the specifics were such
that, it seems to me, there was a rejection of those
facts. . . . But the testimony was detailed and
specific about what happened; and he asked the jury to
rely on his position that he did not know what was up
in light of a lot of evidence that indicated that he
knew some of the things that were going on simply were
not legal, and ultimately the jury concluded they were
criminal.
Sent. Tr. 34-38. These observations by the district court
support its determination that Dehlinger committed perjury for
the sole purpose of deceiving the jury regarding his culpability
and involvement with AAA. The district court therefore properly
sentenced Dehlinger.
23
III.
For the foregoing reasons, we affirm Dehlinger’s conviction
and sentence, without prejudice to any post conviction claim
based on ineffective assistance of counsel that appellant may
elect to pursue.
AFFIRMED
24 | 01-03-2023 | 07-05-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2094167/ | 568 N.E.2d 453 (1991)
209 Ill. App. 3d 889
154 Ill. Dec. 453
P.A.M. TRANSPORT, INC., a Foreign Corporation, Plaintiff and Counterdefendant-Appellee,
v.
BUILDERS TRANSPORT, INC., a Corporation, and Willie Vaughn, Defendants and Counterplaintiffs-Appellants.
No. 5-90-0114.
Appellate Court of Illinois, Fifth District.
February 28, 1991.
*454 Edward M. Wagner, Heyl, Royster, Voelker & Allen, Urbana, for defendants and counterplaintiffs-appellants.
Tracy W. Resch, Parker, Siemer, Austin, Resch & Resch, Effingham, for plaintiff and counterdefendant-appellee.
Justice GOLDENHERSH delivered the opinion of the court:
Defendants, Builders Transport, Inc. (hereinafter defendant), and Willie Vaughn (hereinafter Vaughn), an employee of defendant, appeal from a judgment of the circuit court of Effingham County in which defendants were held jointly and severally liable for $21,751.62 for damages incurred by plaintiff, P.A.M. Transport, Inc., due to a traffic accident between trucks owned by plaintiff and defendant. In this cause, defendants raise the following issues: (1) whether the trial court correctly applied the principles of comparative negligence, (2) whether the trial court's award for lost income for down time is supported by the evidence, (3) whether the trial court's award for costs of repairs to defendant's tractor and trailer is supported by the evidence, and (4) whether the trial court abused its discretion in imposing a discovery sanction which resulted in denying defendant the opportunity to present evidence on its cargo loss claim. We affirm as modified.
The facts in this case are relatively straightforward. In the early hours of November 9, 1987, plaintiff's driver, Ricky Joe Burney, was on a run from Memphis, Tennessee, to Chicago. His first stop was in Effingham. After this stop, Burney continued north on Interstate 57. Approximately 10 miles out of Effingham, Burney pulled the semi-tractor-trailer unit he was driving off onto the shoulder of the road to pour a fresh cup of coffee, to look at his map book, and to relieve himself. Burney testified that no part of his truck was left on the roadway and that all lights and flashers on his vehicle were illuminated.
Vaughn, defendant's driver, was simultaneously on a run which began in Dallas, Texas. He was accompanied by another driver. Vaughn started driving in Memphis and stopped at two rest stops between Memphis and the location of the accident. Vaughn was also northbound on I-57 at approximately 1 a.m., when the accident occurred. Vaughn testified that between 25 and 50 yards before reaching plaintiff's unit, he heard his right front tire blow out and his unit pulled to the right when he applied his brakes. The right side of defendant's unit struck the left rear of plaintiff's trailer and sideswiped it along the entire left side. After defendant's unit cleared plaintiff's unit, it veered sharply to the right, went off the shoulder, and came to rest in a cornfield. The unit completely burned, but the two drivers escaped. Burney received a ticket for driving over the allowable number of hours. He admitted being 10 hours over the permissible driving limit when the accident occurred. Vaughn was given a traffic citation for improper lane usage, to which he pleaded guilty. Vaughn also drew a diagram on a company accident report which showed plaintiff's vehicle as being parked entirely on the shoulder of the interstate.
The parties agree that the shoulder of the road is 10 feet or 120 inches wide. Plaintiff's unit was 102 inches wide. No witnesses testified that any portion of plaintiff's unit was on the roadway. No skid marks were left, and two State Troopers who investigated the accident testified that there was no evidence of a blowout. Burney testified that he saw defendant's vehicle gradually leave the roadway and head toward his vehicle. Based upon this evidence, the trial court found defendants to be jointly and severally liable for 100% of plaintiff's damages.
The first issue we are asked to address is whether the trial court correctly applied the principles of comparative negligence. Defendant argues that the trial court incorrectly applied the doctrine of "last clear chance", which has been abolished and succeeded by the doctrine of comparative negligence in Alvis v. Ribar (1981), 85 Ill. 2d 1, 52 Ill. Dec. 23, 421 N.E.2d 886. Defendants contend that when the doctrine of comparative negligence is applied to the facts of this case, it is apparent that plaintiff is *455 completely liable, or in the alternative, partially liable for defendant's damages. According to defendants, the accident would not have occurred if plaintiff's driver had not been driving in excess of the permissible driving hours and had not been parked illegally on the shoulder of the road. Plaintiff responds that the trial court did not apply the doctrine of last clear chance, but merely mentioned that theory as a historical note to the development of the law. Plaintiff contends that the trial court did apply the doctrine of comparative negligence, and that under the facts of this case, the trial court's decision that defendants were 100% liable is not against the manifest weight of the evidence. We agree.
Defendants are correct that the "last clear chance" doctrine has been abolished and that Illinois has adopted comparative negligence in which a plaintiff's damages are reduced by the percentage of fault the trier of fact finds attributable to plaintiff. (Alvis, 85 Ill. 2d 1, 52 Ill. Dec. 23, 421 N.E.2d 886.) However, the manifest weight of the evidence standard applies where the trier of fact has addressed the degree of plaintiff's comparative negligence. (Ford v. City of Chicago (1985), 132 Ill.App.3d 408, 412, 87 Ill. Dec. 240, 244, 476 N.E.2d 1232, 1236.) When reviewing questions of negligence and proximate cause, a reviewing court will not disturb the trier of fact's decision unless it is clearly unwarranted by the evidence, and, where several reasonable inferences based upon the evidence are possible, the inference drawn by the factfinder must prevail. Noel v. Jones (1988), 177 Ill.App.3d 773, 782, 127 Ill. Dec. 221, 226-27, 532 N.E.2d 1050, 1055-56.
Plaintiff has cited at least two cases in which it has been held that the owner-operator of a parked car was not a proximate cause of an accident, Long v. Soderquist (1984), 126 Ill.App.3d 1059, 82 Ill. Dec. 80, 467 N.E.2d 1153, and Jeanquenat v. Zibert (1979), 78 Ill.App.3d 948, 34 Ill. Dec. 278, 397 N.E.2d 1235. Defendants contend that these cases are not controlling because they were decided prior to our supreme court's ruling in Alvis v. Ribar. What defendants fail to consider is that whether Jeanquenat or Long were decided under either the doctrine of contributory or comparative negligence is unimportant since both courts found as a matter of law that the parked cars involved in the accidents were not the proximate cause of either accident.
In Jeanquenat, a passenger injured in an automobile accident brought a personal injury action against the driver of the automobile in which he was riding, the owner-operator of a car parked illegally in a no parking zone, and the city for not placing adequate no parking zone signs. The trial court directed a verdict for the owner-operator of the parked car and for the city. On review, the third district appellate court affirmed the finding that where the portion of the road where the accident occurred was almost three car lengths across, where visibility was unobstructed, and where the driver had consumed in excess of 10 to 15 beers, was totally inattentive to the roadway, and was facing and talking with the passenger, the plaintiff, when he collided with the parked car, such driver was the sole proximate cause of the accident. The Jeanquenat court found that the driver's "total and unexplained inattention to the roadway while driving an automobile is conduct so outrageously negligent and reckless that in the exercise of reasonable diligence it could not be anticipated." 78 Ill.App.3d at 951, 34 Ill. Dec. at 282, 397 N.E.2d at 1239.
In the instant case, plaintiff's vehicle was parked illegally on the shoulder of the road, but, unlike Jeanquenat, there was no testimony that any portion of plaintiff's truck was on the interstate. Plaintiff's driver testified that he left the truck fully illuminated when he parked on the shoulder. Vaughn testified that he did not recall seeing any light on, but admitted on cross-examination that the lights could have been on. Plaintiff's driver testified that he saw defendant's truck gradually leave the roadway and then come into contact with his truck. There were no skid marks. Vaughn testified that the accident *456 was due to a blowout of his right front tire, but the trial court found this testimony not to be credible. After reviewing the record, we agree. There was no physical evidence to support Vaughn's blowout theory. Instead, the more likely explanation is that Vaughn failed to keep a proper lookout at the road ahead of him.
In Long, the defendant Soderquist had stopped to render assistance to Berndston, another defendant, who had collided with a guardrail. A sheriff's deputy came to render assistance, but was soon after taken away from the scene when another accident occurred in the vicinity. The deputy told the defendants to wait for him while he went to the other scene. As the defendants were waiting, the plaintiffs crested the hill, hit a patch of ice, and collided with the Soderquist vehicle which in turn collided with the Berndston vehicle. The trial court granted the defendant's motion for summary judgment. The plaintiffs appealed, arguing that summary judgment was improper because there were numerous material factual disputes, specifically: (1) whether and to what extend the defendant Soderquist's automobile protruded onto the highway, (2) whether the lights on Soderquist's automobile were illuminated, (3) whether the plaintiff could have avoided the accident, (4) whether the lights on Berndston's automobile were illuminated, and (5) whether the deputy acted properly. The reviewing court found the entry of summary judgment was proper "since it is undisputed that the Long vehicle slipped on the icy bridge at the crest of the hill, and was thereafter out of control, the Soderquist and Berndston vehicles, regardless of their precise placement, cannot be said to be a proximate cause of the collision." (126 Ill.App.3d at 1064, 82 Ill. Dec. at 84, 467 N.E.2d at 1157.) The Long case is somewhat factually distinguishable from the case at bar. In Long, it was the plaintiff who hit the parked car on the side of the road. In the instant case, plaintiff was hit while parked on the shoulder of the road. However, the Long court's logic is undeniable and it is applicable in the instant case. Neither the placement of Burney's vehicle on the side of the road nor the fact that Burney had driven over the permissible number of hours was a proximate cause of this collision. Just because a person happens to be in a location where an accident occurs does not make him a proximate cause of the accident. This is certainly true in the instant case because even if plaintiff's vehicle was not parked on the shoulder of the road, and even if plaintiff's driver had stopped driving for the day, defendant's driver would still have driven off the interstate. We are by no means advocating an absolute rule that a parked vehicle can never be a proximate cause of an accident. There may be instances in which a party who has parked a vehicle could be found negligent for an ensuing accident. However, we do not find this case to be one of those instances. Accordingly, the trial court's finding that plaintiff was not a proximate cause of the accident and that defendants were 100% liable for plaintiff's damages is not against the manifest weight of the evidence. We believe the trial court's discussion of the last clear chance doctrine was nothing more than an historical note. We find the trial court correctly applied the principles of comparative negligence.
The second issue we are asked to address is whether the trial court's award of lost income for down time is supported by the evidence. Defendant argues that evidence submitted to prove the loss of down time was without proper foundation and full of hearsay testimony which should never have been allowed. We agree.
The trial court awarded plaintiff $301.02 for income lost due to its tractor and trailer involved in this accident being out of commission. In order to arrive at this figure, the trial court apparently looked to the testimony of Riley Tessaro, plaintiff's casualty claims manager. Plaintiff submitted the following document, plaintiff's exhibit 17, in which Tessaro concluded that the unit involved in the accident was down for 14 days due to damages sustained in the accident:
*457
"To Whom It May Concern:
I have compiled the following information from figures
furnished by Marketing and our Controller:
Gross Revenue:
415 miles/day × 14 days $5,810 [sic]
Average Rev/mile 97.5
_______
Gross Revenue not
realized due to downtime $5,664.75
Less Expenses:
Fixed Expensesper
month average $3400/mo (1)
Pro Rata 3400[sic] 30 × 14 $1,587
Variable costs (2)
46¢ per mile
46 × 5810 $2,673
Total Expenses $4,260.00
Loss of Income $1,404.75
(1) Insurance, taxes, interest, depreciation, etc.
(2) Driver, fuel, repairs, maintenance, tires, etc.
Thank you,
P.A.M. TRANSPORT, INC.
Riley Tessaro
Casualty Claims Manager
RT/mw"
Upon cross-examination, however, Tessaro admitted that the figures used in the document were received by him from plaintiff's marketing department. Tessaro did not personally review any documents used by the marketing department and did not rely on any business document to produce the above figures. Further, Tessaro could not indicate what figures were included in parentheticals (1) or (2) or the etc. listed therein. He had no information or documents to indicate that plaintiff had to refuse loads and, if so, how many. Tessaro indicated that plaintiff's controller would have such knowledge, but plaintiff's controller was never called as a witness. Rick Burney, plaintiff's driver, testified that he had another load to pick up in Chicago after he delivered the cargo he was carrying, and he was certain that he was committed to drive for the three days following the accident, which he was unable to do. However, neither Burney nor Tessaro could testify whether any load leaving Chicago later on the day of the accident or the following day was or was not taken by another of plaintiff's trucks. Nevertheless, the trial court awarded plaintiff $301.02 for down time.
We find that plaintiff did not prove damages for down time. First, there was no testimony that plaintiff had to turn away customers due to the unit involved in this accident being out of operation. Second, plaintiff's exhibit 17 should not have been introduced into evidence, as it was clearly hearsay. Therefore, we find that the trial court erred in awarding $301.02 for down time and that the judgment should be reduced accordingly.
The third issue we are asked to address is whether the trial court's award *458 for costs of repairs to plaintiff's tractor and trailer is supported by the evidence. Defendants argue that plaintiff never put forth any evidence as to what costs it actually expended in the repair of the tractor and trailer, and, therefore, was not entitled to any recovery. In the alternative, defendants argue that the trial court's award of waiver costs must be vacated, as the repairs were all done "in house" by plaintiff's staff, and plaintiff failed to prove how much it cost to have its own employees complete the repairs. Plaintiff replies that the fact that it made its own repairs in house does not render the testimony of qualified witnesses who give estimates of repairs inadmissible and that the testimony of its witnesses concerning the costs of repair was sufficient. We agree.
If property has been damaged and can be repaired, the true measure of damages is reasonable cost of repairs, providing that it is less than the value of the property before it was injured. (Santiemmo v. Days Transfer (1956), 9 Ill.App.2d 487, 502, 133 N.E.2d 539, 547.) The purpose of awarding compensatory damages is to make the injured party whole, but not to enable him to profit at defendant's expense. (9 Ill. App.2d at 502, 133 N.E.2d at 547.) Undoubtedly, difficulty in determining damages arises when the repairs are done in house, and there are no sufficiently definite guidelines to be relied upon when determining such damages. See Central Illinois Light Co. v. Stenzel (1963), 44 Ill.App.2d 388, 195 N.E.2d 207.
In the instant case, the trial court made the following determinations concerning the reasonable cost to repair the tractor and trailer in its judgment order:
"3. Reasonable cost to repair tractor:
a) Parts: fuel tank and tires, $1,726.16 less 10% markup of $172.62: $1,553.54.
b) Balance of parts: $2,199.07 less 20% markup of $439.81: $1,759.26.
c) Labor: $2,238.47.
4. Reasonable cost to repair trailer:
a) Parts: $47,982.83 less 20% markup of $1,596.57: $6,386.26.
b) Labor: $4,513.32.
The above findings on labor costs are based on Plaintiff's Exhibits 18 and 19 which must be viewed together and which give some indication as to what the Defendant considered reasonable for labor for repairs. As there is no testimony in the record, either by deposition or in Court testimony, as to profit margin on labor, the Court is forced to rely on Defendant's calculations as the Court finds it would be unreasonable to infer that labor cost for Plaintiff's employer would be as high as labor charges by third parties making estimates.
Plaintiff having failed to establish any taxes paid for repairs is denied any recovery for same."
The trial court's determination of reasonable costs of repair came from plaintiff's witnesses who included Charles White, a shop foreman and body shop repairman for Ozark Truck Sales in Springdale, Arkansas; Truman Murphy, a service manager for J.M.C. Truck and Trailers in Tontitown, Arkansas; and plaintiff's own body shop manager. Defendants apparently contend that Charles White and Truman Murphy were not qualified to testify on this issue because the repairs were done in house. Defendants cite no case law by which we are bound holding that one knowledgeable in such repairs is not qualified to testify if the repairs are done in house. Our own search has discovered no such precedent. Instead, after reviewing the record, we find that this testimony was relevant, and that the trial court properly considered it along with both plaintiff's and defendants' calculations. Plaintiff clearly suffered losses due to this accident. We do not believe the trial court's award for repair costs put plaintiff in a better position than if the accident had not occurred. We find the award to be reasonable and supported by the evidence.
Because of our decision that the trial court did not err in finding that plaintiff was not a proximate cause of this accident, we need not address defendant's final issue concerning defendant's cargo loss claim.
Exercising the power granted to us by Supreme Court Rule 366(a)(5) (134 Ill.2d R. *459 366(a)(5)), we hereby modify the judgment of the circuit court of Effingham County by reducing the damages awarded to plaintiff by $301.02. The judgment is hereby modified to award plaintiff damages in the amount of $21,450.60.
For the foregoing reasons, the judgment of the circuit court of Effingham County is hereby affirmed as modified.
Affirmed as modified.
RARICK, P.J., and WELCH, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1034758/ | United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 16, 2012 Decided July 23, 2013
No. 08-1200
STATE OF MISSISSIPPI,
PETITIONER
v.
ENVIRONMENTAL PROTECTION AGENCY,
RESPONDENT
COUNTY OF NASSAU, ET AL.,
INTERVENORS
Consolidated with 08-1202, 08-1203, 08-1204, 08-1206
On Petition for Review of a Final Rule Issued
by the United States Environmental Protection Agency
F. William Brownell argued the cause for State of
Mississippi and Industry Petitioners. With him on the briefs
were Allison D. Wood, Lucinda Minton Langworthy, Harold
E. Pizzetta, III, Special Assistant Attorney General, Office of
the Attorney General for the State of Mississippi, Robert R.
Gasaway, Jeffrey Bossert Clark, and William H. Burgess.
David S. Baron argued the cause for Environmental
Petitioners. With him on the briefs was Seth L. Johnson.
2
Michael J. Myers, Assistant Attorney General, Office of
the Attorney General for the State of New York, argued the
cause for State Petitioners. With him on the briefs were Eric
T. Schneiderman, Attorney General, Barbara D. Underwood,
Solicitor General, Morgan A. Costello, Assistant Attorney
General, Kamala D. Harris, Attorney General, Office of the
Attorney General for the State of California, Nicholas Stern,
Deputy Attorney General, George Jepsen, Attorney General,
Office of the Attorney General for the State of Connecticut,
Kimberly P. Massicotte and Scott Koshwitz, Assistant
Attorneys General, Joseph R. Biden, III, Attorney General,
Office of the Attorney General for the State of Delaware,
Valerie M. Satterfield, Deputy Attorney General, Lisa
Madigan, Attorney General, Office of the Attorney General
for the State of Illinois, Gerald T. Karr, Senior Assistant
Attorney General, William J. Schneider, Attorney General,
Office of the Attorney General for the State of Maine, Gerald
D. Reid, Assistant Attorney General, Douglas F. Gansler,
Attorney General, Office of the Attorney General for the State
of Maryland, Roberta R. James, Assistant Attorney General,
Martha Coakley, Attorney General, Office of the Attorney
General for the Commonwealth of Massachusetts, Carol
Iancu, Assistant Attorney General, Michael A. Delaney,
Attorney General, Office of the Attorney General for the State
of New Hampshire, K. Allen Brooks, Assistant Attorney
General, Gary K. King, Attorney General, Office of the
Attorney General for the State of New Mexico, Stephen R.
Farris, Assistant Attorney General, Ellen F. Rosenblum,
Attorney General, Office of the Attorney General for the State
of Oregon, Paul S. Logan, Assistant Attorney-in-Charge,
Peter Kilmartin, Attorney General, Office of the Attorney
General for the State of Rhode Island, Gregory S. Schultz,
Special Assistant Attorney General, Irvin B. Nathan, Attorney
General, Office of the Attorney General for the District of
Columbia, Amy E. McDonnell, Deputy General Counsel, and
3
Christopher King. William L. Pardee, Assistant Attorney
General, Office of the Attorney General for the
Commonwealth of Massachusetts at the time the brief was
filed, Tricia K. Jedele, Special Assistant Attorney General,
Office of the Attorney General for the State of Rhode at the
time the brief was filed, Maureen Smith, Senior Assistant
Attorney General, Office of the Attorney General for the State
of Rhode Island, Donna M. Murasky, Deputy Solicitor,
Office of the Attorney General for the District of Columbia,
and Katherine Kennedy entered appearances.
Richard A. Wegman and Harold G. Bailey, Jr. were on
the brief for amicus curiae Province of Ontario in support of
petitioners State of New York, et al. and petitioners American
Lung Association, et al.
Madeline Fleisher, Attorney, and David J. Kaplan,
Senior Attorney, U.S. Department of Justice, argued the
causes for respondent. With them on the brief was John
Hannon, Attorney, U.S. Environmental Protection Agency.
David S. Baron and Seth L. Johnson were on the brief for
Environmental Intervenors.
F. William Brownell, Allison D. Wood, Lucinda Minton
Langworthy, Robert R. Gasaway, Jeffrey Bossert Clark, and
William H. Burgess were on the brief for industry intervenor-
respondents Ozone NAAQS Litigation Group, et al. in
support of respondent. Duane J. Desiderio entered an
appearance.
Before: TATEL, BROWN, and GRIFFITH, Circuit Judges.
Opinion for the Court filed PER CURIAM.
4
PER CURIAM: In this opinion, we consider several
challenges to the Environmental Protection Agency’s most
recent revisions to the primary and secondary National
Ambient Air Quality Standards for ozone. For the reasons
given below, we deny the petitions, except with respect to the
secondary ozone standard, which we remand for
reconsideration.
I.
The Clean Air Act directs EPA to establish and
periodically review and revise primary and secondary
National Ambient Air Quality Standards (“NAAQS”) for
certain pollutants the “emissions of which . . . cause or
contribute to air pollution which may reasonably be
anticipated to endanger public health or welfare.” 42 U.S.C.
§ 7408(a)(1)(A). Under section 109(b)(1), primary NAAQS
are to be set at levels “the attainment and maintenance of
which in the judgment of the Administrator, . . . allowing an
adequate margin of safety, are requisite to protect the public
health.” Id. § 7409(b)(1). Under section 109(b)(2), secondary
NAAQS “shall specify a level of air quality the attainment
and maintenance of which in the judgment of the
Administrator . . . is requisite to protect the public welfare
from any known or anticipated adverse effects.” Id.
§ 7409(b)(2). The Act provides that the public welfare
protected by secondary NAAQS includes “effects on soils,
water, crops, vegetation, manmade materials, animals,
wildlife, weather, visibility, and climate, damage to and
deterioration of property, and hazards to transportation, as
well as effects on economic values and on personal comfort
and well-being.” Id. § 7602(h).
“Once EPA establishes NAAQS for a particular
pollutant, the standards become the centerpiece of a complex
statutory regime aimed at reducing the pollutant’s
5
atmospheric concentration.” American Trucking Ass’ns v.
EPA (“ATA III”), 283 F.3d 355, 358–59 (D.C. Cir. 2002).
EPA must “complete a thorough review” of each NAAQS at
five-year intervals and “make such revisions . . . as may be
appropriate.” 42 U.S.C. § 7409(d)(1). Pursuant to section
109(d)(2), the Clean Air Scientific Advisory Committee
(“CASAC”) must periodically review NAAQS and
“recommend to [EPA] any new [NAAQS] and revisions of
existing criteria and standards as may be appropriate.” Id.
§ 7409(d)(2)(A)–(B). In proposing to issue new NAAQS or
revise existing ones, EPA must “set forth or summarize and
provide a reference to any pertinent findings,
recommendations, and comments by [CASAC]” and explain
the reasons for any “important” divergences from CASAC’s
recommendations. Id. § 7607(d)(3), (6).
These consolidated cases concern the NAAQS for ozone
(O3). Ozone is a colorless, odorless gas that is not a direct
product of human activity but instead forms when other
atmospheric pollutants react in the presence of sunlight. ATA
III, 283 F.3d at 359. EPA has identified several health effects
linked to ozone, including decreased lung function and
respiratory symptoms. Proposed National Ambient Air
Quality Standards for Ozone (“2007 Proposed Rule”), 72 Fed.
Reg. 37,818, 37,827 (July 11, 2007). EPA has also found that
ozone is associated with more serious health effects such as
increased asthma medication use, emergency department
visits, and hospital admissions. See id. at 37,827–29, 37,832.
Furthermore, EPA has determined that ozone has a broad
array of effects on trees, vegetation, and crops and can
indirectly affect other ecosystem components such as soil,
water, and wildlife. Id. at 37,883.
EPA last revised the ozone NAAQS in 1997, instituting
an “8-hour” primary standard—based on the annual fourth-
6
highest daily maximum 8-hour average ozone
concentration—of 0.08 parts per million. National Ambient
Air Quality Standards for Ozone (“1997 Final Rule”), 62 Fed.
Reg. 38,856, 38,873 (July 18, 1997). EPA also set the
secondary NAAQS to be identical to this primary standard in
both form (measured over an 8-hour period) and level (0.08
ppm). Id. at 38,877–78. In American Trucking Associations v.
EPA, 175 F.3d 1027 (D.C. Cir. 1999), several parties
challenged these revisions, as well as the NAAQS for
particulate matter that EPA had issued at the same time. After
the Supreme Court reversed this court’s conclusion that the
Clean Air Act unconstitutionally delegated Congress’s
legislative authority, see Whitman v. American Trucking
Ass’ns, 531 U.S. 457, 473–76 (2001), we rejected all of
petitioners’ challenges to both the primary and secondary
ozone NAAQS. ATA III, 283 F.3d at 378–80.
EPA initiated the current review of the ozone NAAQS in
2000. Proceeding under a schedule adopted by consent
decree, and after receiving significant public comment on
proposed changes, EPA issued revised primary and secondary
standards on March 27, 2008. National Ambient Air Quality
Standards for Ozone (“2008 Final Rule”), 73 Fed. Reg.
16,436 (Mar. 27, 2008). In reaching its final decision, EPA
examined “the entire body of evidence relevant to examining
associations between exposure to ambient O3 and a broad
range of health endpoints.” Id. at 16,439. Of particular
relevance here, EPA emphasized new clinical studies,
including human exposure studies, showing respiratory
effects at ozone levels below 0.08 ppm. Id. at 16,449–50,
16,470–71. EPA also cited new epidemiological evidence
suggesting associations between “serious morbidity
outcomes” and ozone exposure at levels below 0.08 ppm, as
well as risk assessments estimating the effects of various
levels of ozone on the population. Id. at 16,446, 16,450–51,
7
16,471–72. On the basis of this evidence, EPA concluded that
the existing 0.08 ppm primary standard was not requisite to
protect the public health with an adequate margin of safety.
Id. at 16,470–71.
Assessing the proper level for a revised standard, EPA
found that a level just below 0.08 ppm would be inappropriate
because “such a level would not be appreciably below the
level in controlled human exposure studies at which adverse
effects have been demonstrated.” Id. at 16,482. Although
acknowledging that CASAC had recommended a level as low
as 0.060 to 0.070 ppm, see id., EPA determined that “[a]
standard set at a level lower than 0.075 [ppm] would only
result in significant further public health protection if, in fact,
there is a continuum of health risks in areas with . . . O3
concentrations that are well below the concentrations
observed in the key controlled human exposure studies and if
the reported associations observed in epidemiological studies
are, in fact, causally related to O3 at those lower levels,” id. at
16,483. Stating that it was “not prepared to make these
assumptions,” EPA found that, with a standard set below
0.075 ppm, “the likelihood of obtaining benefits to public
health . . . decreases, while the likelihood of requiring
reductions in ambient concentrations that go beyond those
that are needed to protect public health increases.” Id.
“[J]udg[ing] that the appropriate balance to be drawn, based
on the entire body of evidence and information available in
this review, is a standard set at 0.075 [ppm],” EPA concluded
that “[a] standard set at this level provides a significant
increase in protection compared to the current standard, and is
appreciably below 0.080 ppm, the level in controlled human
exposure studies at which adverse effects have been
demonstrated.” Id.
8
EPA also determined that the secondary standard should
be revised to be identical to the new primary standard. Id. at
16,500. Noting new evidence that had become available since
the last review, EPA found that the ozone level of the existing
secondary standard would cause significant effects on
vegetation and sensitive ecosystems. Id. at 16,496–97. EPA
acknowledged CASAC’s recommendation that a revised
secondary standard should measure ozone exposure
cumulatively over a seasonal period, rather than the 8-hour
period of the primary standard. Id. at 16,498–500. EPA
agreed with CASAC that “a cumulative, seasonal standard is
the most biologically relevant way to relate exposure to plant
growth response.” Id. at 16,500. Nonetheless, conducting a
comparison between the revised primary standard and a range
of proposed levels for a cumulative, seasonal standard, EPA
found “significant overlap between the revised 8-hour
primary standard and selected levels of the [seasonal]
standard form being considered.” Id. at 16,499. Although
recognizing that “there would be the potential for not
providing the appropriate degree of protection for vegetation
in areas with air quality distributions that result in a high
cumulative, seasonal exposure but do not result in high 8-hour
average exposures,” the agency determined that “establishing
a new secondary standard with a cumulative, seasonal form at
this time would result in uncertain benefits beyond those
afforded by the revised primary standard and therefore may
be more than necessary to provide the requisite degree of
protection.” Id. at 16,500. EPA therefore concluded that the
revised primary standard “would be sufficient to protect
public welfare from known or anticipated adverse effects,
and . . . that an alternative cumulative, seasonal standard is
[not] needed to provide this degree of protection.” Id.
Challenging the revised primary and secondary NAAQS,
various parties, including several states, the District of
9
Columbia, New York City, and several industry,
environmental, and public health groups, filed these petitions
for review. We then granted EPA’s unopposed motion to hold
these cases in abeyance to allow the agency to review the
2008 revisions and determine whether they should be
reconsidered. In September 2011, EPA indicated that it was
withdrawing its reconsideration proceedings and would
instead be completing the reconsideration in conjunction with
the next periodic review. Several parties filed petitions for
review, challenging EPA’s withdrawal of the reconsideration
rulemaking. Finding that we lacked jurisdiction over EPA’s
non-final action, we dismissed the petitions and set a briefing
schedule for the present case.
We now confront the parties’ competing petitions for
review. One set of petitioners—comprising several states, the
District of Columbia, New York City, and a number of
environmental and public health groups—thinks the primary
and secondary NAAQS are not protective enough, while the
other set—comprising the state of Mississippi and several
industry groups—thinks they are too protective.
This opinion considers each of these claims in turn. We
reject Mississippi and the industry groups’ challenge to the
primary and secondary standards in Part II. We explain our
denial of the governmental and environmental petitions with
respect to the primary standard in Part III and our grant of
these petitions with respect to the secondary standard in Part
IV.
In considering challenges to NAAQS, “we apply the
same highly deferential standard of review that we use under
the Administrative Procedure Act.” ATA III, 283 F.3d at 362.
Accordingly, “we will set aside the Agency’s determination
only if it is ‘arbitrary, capricious, an abuse of discretion, or
10
otherwise not in accordance with law.’ ” National
Environmental Development Ass’n’s Clean Air Project v.
EPA, 686 F.3d 803, 809–10 (D.C. Cir. 2012) (quoting 42
U.S.C. § 7607(d)(9)(A)). And “we do not look at the decision
as would a scientist, but as a reviewing court exercising our
narrowly defined duty of holding agencies to certain minimal
standards of rationality.” Id. at 810 (internal quotation marks
omitted). That said, “we perform a searching and careful
inquiry into the underlying facts.” ATA III, 283 F.3d at 362
(internal quotation marks omitted).
II.
Mississippi and the industry petitioners (collectively
“Mississippi”) challenge EPA’s threshold decision to revise
the primary NAAQS level. According to Mississippi, several
aspects of EPA’s decision were arbitrary, including its
allegedly unsupported finding that the revised NAAQS would
provide increased protection; its failure to compare the 2008
risk assessment with the 1997 risk assessment; and the
allegedly inadequate and distorted science on which the
agency relied. We reject these arguments. Mississippi also
claims the secondary NAAQS is improper because it tracks
the primary NAAQS, which Mississippi believes is unlawful,
but this argument falls as collateral damage from our rejection
of Mississippi’s challenge to the primary NAAQS.
A.
The Clean Air Act requires EPA to set primary NAAQS
that are “requisite” to protect the public health with an
adequate margin of safety. 42 U.S.C. § 7409(b)(1).
“Requisite” means the NAAQS must be “sufficient, but not
more than necessary.” Whitman, 531 U.S. at 473 (internal
quotation marks omitted). Mississippi now tells us the agency
cannot determine why further risk reduction is “requisite”
without “putting risk in the context of earlier NAAQS
11
decisions (and other risk-based decisions).” Mississippi’s Br.
24. EPA’s failure to do so, Mississippi explains, means the
NAAQS revision is nothing more than the legally inadequate
determination that a lower level is more protective. Not so.
The force of Mississippi’s position, generated by the
Whitman Court’s malleable definition of “requisite,” assumes
only one standard at any given time can be “requisite”
because, by definition, that standard is neither higher nor
lower than necessary. Any other standard would therefore
miss the mark. But of course, this idea presupposes scientific
certainty in an area actually governed by policy-driven
approaches to uncertain science. See Lead Industries Ass’n v.
EPA, 647 F.2d 1130, 1146–47 (D.C. Cir. 1980); see also
Motor Vehicle Manufacturers Ass’n of the U.S. v. State Farm
Mutual Automobile Insurance Co., 463 U.S. 29, 57 (1983).
Mississippi’s position—though perhaps an arguable thesis—
collapses under the weight of reality.
Determining what is “requisite” to protect the “public
health” with an “adequate” margin of safety may indeed
require a contextual assessment of acceptable risk. See
Whitman, 531 U.S. at 494–95 (Breyer, J., concurring in part
and concurring in the judgment). Such is the nature of policy.
But that does not mean the initial assessment is sacrosanct and
remains the governing standard until every aspect of it is
undermined. Every time EPA reviews a NAAQS, it
(presumably) does so against contemporary policy judgments
and the existing corpus of scientific knowledge. See 42 U.S.C.
§§ 7408–09. It would therefore make no sense to give prior
NAAQS the sort of presumptive validity Mississippi insists
upon. The statutory framework requires us to ask only
whether EPA’s proposed NAAQS is “requisite”; we need not
ask why the prior NAAQS once was “requisite” but is no
longer up to the task. Following Mississippi’s approach would
12
bind EPA to potential deficiencies in past reviews because
discrepancies between past and current judgments as easily
reflect problems in the past as in the present. We decline
Mississippi’s invitation to enter that funhouse and will defer
as long as EPA reasonably explains its actions. American
Farm Bureau Federation v. EPA, 559 F.3d 512, 521 (D.C.
Cir. 2009) (per curiam).
Mississippi argues at length that EPA should have
compared the evidence available in 2008 to the evidence
available in 1997—in particular, the clinical, epidemiological,
and toxicological studies, risk assessments, and EPA’s
protocol for sensitive populations. We need not respond point
by point; suffice to say that EPA reasonably explained how
the scientific evidence had in fact changed since the 1997
review. To name just one example, whereas in reviewing
EPA’s 1997 NAAQS-setting we emphasized “the absence of
any human clinical studies at ozone concentrations below
0.08,” ATA III, 283 F.3d at 379, EPA here explained that “two
new controlled human-exposure studies . . . are now available
that examine respiratory effects associated with prolonged O3
exposures at levels at and below 0.080 ppm.” 2008 Final
Rule, 73 Fed. Reg. at 16,454. 1 But to frame it more broadly,
1
Because Mississippi independently challenges EPA’s failure
to compare its 2008 and 1997 risk assessments, however, we also
acknowledge the reasonableness of EPA’s explanation for not
doing so—namely, that a comparison would be “factually
inappropriate,” would not account for the fact that “with similar
risks, increased certainty in the risks” would engender greater
concern, and would obscure the qualitativeness of EPA’s approach.
2008 Final Rule, 73 Fed. Reg. at 16,466. First, the 2008 risk
assessment analyzed a number of health effects not included in the
1997 risk assessment, so the ultimate value of comparing the two
assessments would be limited. Second, logic rejects comparisons of
13
we note, first, that the NAAQS review process includes
EPA’s public health policy judgments as well as its analysis
of scientifically certain fact, and, second, that as the contours
and texture of scientific knowledge change, the
epistemological posture of EPA’s NAAQS review necessarily
changes as well; additional certainty about what was merely a
thesis might very well support a determination that the line
marked by the term “requisite” has shifted. In short,
Mississippi seeks to eliminate any adumbration of the
inevitable scientific uncertainties that shadow and shape
EPA’s statutory mandate to take a preventative approach. See,
e.g., ATA III, 283 F.3d at 378.
B.
Mississippi looses the rest of its arrows at the evidence
on which EPA relied, although in doing so, Mississippi again
showcases its apparent preference for exuberance over
precision. Ultimately, Mississippi’s arguments that the 2008
science added nothing new to the 1997 NAAQS conversation
and that EPA misrepresented the science on which it relied
apples and oranges, which is how we would describe two data
analyses subject to different geographic and demographic
parameters. See, e.g., 2007 Proposed Rule, 72 Fed. Reg. at 37,851–
52 (explaining that 2008 exposure analysis, an input to part of the
risk assessment, relied on a model different from the one used in
1997). And finally, even if EPA should have compared the two risk
assessments where they overlapped, EPA’s failure to do so does not
necessarily render EPA’s ultimate NAAQS decision improper. See
ATA III, 283 F.3d at 369–70; see also Lead Industries Ass’n, 647
F.2d at 1162. The risk assessment turned on more than just those
risks amenable to comparison with the 1997 risk assessment, and in
setting the NAAQS, EPA relied on much more than just the risk
assessment. See, e.g., 2008 Final Rule, 73 Fed. Reg. at 16,467,
16,476, 16,479.
14
are largely dependent on the conceptual error that EPA is
somehow bound by the 1997 NAAQS and on the legal error
that it is our job to “weigh the evidence anew.” American
Farm Bureau, 559 F.3d at 533 (internal quotation marks
omitted). Nonetheless, we address each argument in turn,
construing Mississippi’s arguments to articulate a weightier
challenge: that the available evidence did not support EPA’s
threshold decision to revise the NAAQS. We again disagree.
1.
The 1997 standard was “set at a level of 0.08 ppm, which
is equivalent to 0.084 ppm using the standard rounding
conventions.” 2008 Final Rule, 73 Fed. Reg. at 16,437. By
framing the issue in terms of EPA’s decision to lower the
NAAQS level below 0.080 ppm, Mississippi fails to capture
the full significance of the 2008 NAAQS revision. 2 Indeed,
Mississippi’s imprecision undermines its case: by conceding
that health effects are linked to ozone levels of 0.080 ppm,
Mississippi rebuts its claim that science in 2008 did not
support a NAAQS set at an effective level lower than 0.084
ppm.
In any event, after reviewing the record, we think it quite
clear EPA’s rejection of the 1997 NAAQS was proper. EPA
relied on a broad array of scientific studies, quantified
models, and input from CASAC, EPA staff, and commenters,
and it considered not only what was known, but also what was
not known. See, e.g., 2008 Final Rule, 73 Fed. Reg. at
16,438–40. It then evaluated the evidence as a whole through
2
For that matter, EPA commits the same error, referring to
“0.080” when it should refer to “0.08,” compare 2008 Final Rule,
73 Fed. Reg. at 16,444, with 1997 Final Rule, 62 Fed. Reg. at
38,859, but Mississippi does not note it, so we have no reason to
think this reflects anything other than sloppy editing.
15
an “integrative synthesis,” what it called a “weight of
evidence approach.” Id. at 16,439, 16,479. And appropriately
so: one type of study might be useful for interpreting
ambivalent results from another type, see Ethyl Corp. v. EPA,
541 F.2d 1, 26 (D.C. Cir. 1976) (en banc), and though a new
study does little besides confirm or quantify a previous
finding, such incremental (and arguably duplicative) studies
are valuable precisely because they confirm or quantify
previous findings or otherwise decrease uncertainty. See, e.g.,
2008 Final Rule, 73 Fed. Reg. at 16,450 (noting that post-
1997 evidence “increased the Administrator’s confidence”
that particular health endpoints are causally related to ozone
exposure). EPA made this point when it explained that
controlled human exposure studies provide “the most directly
applicable” evidence (and engender “the highest level of
confidence”) about the causal relationship between ozone
exposure and health effects; that epidemiological studies
provide evidence both about health effects from exposure to
ambient air and about the effect of ozone exposure on “more
serious” health effects like hospital admissions and mortality;
and that animal toxicology studies generally support the
biological plausibility of effects noted in clinical and
epidemiological studies. 2007 Proposed Rule, 72 Fed. Reg. at
37,823, 37,825; see 2008 Final Rule, 73 Fed. Reg. at 16,440
(incorporating discussion of scientific evidence in proposed
rule). Given that the record includes, among other things,
numerous epidemiological studies linking health effects to
exposure to ozone levels below 0.08 ppm and clinical human
exposure studies finding a causal relationship between health
effects and exposure to ozone levels at and below 0.08 ppm,
we will not second-guess EPA’s interpretations of, or the
conclusions it drew from, this evidence.
Reasonable people might disagree with EPA’s
interpretations of the scientific evidence, but any such
16
disagreements must come from those who are qualified to
evaluate the science, not us. We are satisfied that EPA’s
interpretations are permissible, and that is enough. Indeed,
CASAC unanimously concluded that “[t]here is no scientific
justification for retaining the current primary 8-hr NAAQS of
0.08 parts per million,” that the primary NAAQS “needs to be
substantially reduced to protect human health,” and that the
primary NAAQS should be set at a level somewhere between
0.060 and 0.070 ppm. Letter from Dr. Rogene Henderson,
CASAC Chair, to Stephen L. Johnson, EPA Administrator
(“Oct. 2006 CASAC Letter”), at 1–2 (Oct. 24, 2006), EPA-
CASAC-07-001. If, as we have explained, EPA may give
“significant weight” to propositions about the appropriate
NAAQS level implicitly accepted by otherwise-disagreeing
CASAC members, see ATA III, 283 F.3d at 378–79, surely it
may rely on an explicit recommendation by the unanimous
CASAC panel.
And given the reasonableness of EPA’s interpretation of
the science, its determination that the 1997 NAAQS was
insufficiently protective of public health follows as a matter
of course. EPA concluded sensitive populations like
asthmatics are affected by ozone in a more severe way and at
lower levels than are healthy individuals and that ozone-
related health effects might be adverse for sensitive
individuals though comparable effects would not be
considered adverse for healthy individuals—conclusions
Mississippi does not challenge. See 2008 Final Rule, 73 Fed.
Reg. at 16,454–55, 16,466. EPA could properly decide that a
NAAQS set at the level of 0.08 ppm does not protect the
public health with an adequate margin of safety when healthy
individuals experience adverse health effects from exposure
to ozone at and below that level. See, e.g., American Farm
Bureau, 559 F.3d at 525–26. “That petitioners . . . find a basis
to disagree” with EPA is “hardly surprising.” Ethyl Corp., 541
17
F.2d at 26. But that does not make EPA’s decision to revise
the NAAQS arbitrary.
2.
Mississippi also contends that section 108(a)(2) of the
Clean Air Act, 42 U.S.C. § 7408(a)(2), requires EPA “to
consider and rely upon all scientific information that is
capable of being put to use and serviceable for [identifying
the effect that a given pollutant has on public health and
welfare] and that is free from error (accurate).” Mississippi’s
Br. 47. This requirement, Mississippi explains, incorporates
information standards under the Information Quality Act
(“IQA”), Pub. L. No. 106-554, sec. 1(a)(3), § 515, 114 Stat.
2763, 2763A-153 to 154 (2000) (H.R. 5658) (codified at 44
U.S.C. § 3516 note). According to Mississippi (as we
understand its argument), EPA violated both the Clean Air
Act and the IQA by inaccurately characterizing some studies
and by relying on other, flawed studies. These arguments are
difficult to parse because they fill two roles in Mississippi’s
shadow play: reinforcing the implied point that the available
evidence did not support EPA’s decision to revise the
NAAQS level and unmasking a violation of the Clean Air
Act’s procedural requirements. Having already discussed the
reasonableness of EPA’s threshold decision to revise the
NAAQS, we now consider only Mississippi’s suggestion that
EPA violated the Clean Air Act’s and the IQA’s procedural
standards and that these violations independently render
EPA’s NAAQS determination unlawful.
The Clean Air Act implicitly divides the NAAQS review
process into three stages. First, members of the scientific
community publish studies, which may be more or less
flawed. Second, EPA must issue and periodically revise air
quality criteria that “accurately reflect the latest scientific
knowledge useful in indicating the kind and extent of all
18
identifiable effects on public health or welfare which may be
expected from the presence of such pollutant in the ambient
air, in varying quantities.” 42 U.S.C. §§ 7408(a)(2), 7409(d).
Finally, EPA must “base[]” its NAAQS determinations on the
criteria. 42 U.S.C. § 7409(b)(1). From start to finish, this
system is vulnerable to error. In particular, even if the
foundational scientific studies are not flawed in any material
way, transmission errors may nevertheless occur when EPA
drafts the criteria or when it subsequently decides what
NAAQS to set. Mississippi’s point appears to be that the
Clean Air Act and the IQA impose safeguards to ensure
accuracy throughout this entire process. While that may be a
fair characterization, it overstates the practical effect of the
statutory schemes.
First, though the Clean Air Act requires the air quality
criteria to “accurately reflect” the scientific evidence, that
requirement says nothing about the accuracy of the science
itself or the precision of the relationship between the criteria
and EPA’s NAAQS decision. The criteria, which are neither
“standards” nor “guidelines,” simply “provide the scientific
basis for promulgation of air quality standards.” Lead
Industries Ass’n, 647 F.2d at 1136–37. We do not reweigh the
evidence or second-guess technical judgments but are limited
to determining whether EPA made a rational judgment. See
American Petroleum Institute v. Costle, 665 F.2d 1176, 1185
(D.C. Cir. 1981). Nor do we look through the microscope to
scrutinize EPA’s use of the criteria: there are limits to EPA’s
discretion in using the criteria, see Michigan v. EPA, 213 F.3d
663, 696 (D.C. Cir. 2000) (per curiam), but EPA’s translation
of the criteria into a NAAQS decision is not frictionless, and
ignoring this fact would squeeze considerations of policy and
the role of CASAC out of the equation. See 42 U.S.C.
§ 7607(d)(3); see also Catawba County, North Carolina v.
EPA, 571 F.3d 20, 35 (D.C. Cir. 2009) (per curiam).
19
Second, Mississippi fails to show the IQA is an
independent measure of EPA’s NAAQS decision. The IQA
requires the Director of the Office of Management and
Budget to provide “policy and procedural guidance” to
“ensur[e] and maximiz[e] the quality, objectivity, utility, and
integrity of information . . . disseminated by Federal
agencies.” 44 U.S.C. § 3516 note. OMB, in turn, issued
flexible, “generic” guidelines that it recognized “cannot be
implemented in the same way by each agency.” Guidelines
for Ensuring and Maximizing the Quality, Objectivity, Utility,
and Integrity of Information Disseminated by Federal
Agencies; Republication, 67 Fed. Reg. 8,452, 8,452–53 (Feb.
22, 2002). EPA’s implementing guidelines, meanwhile,
purport to provide only “non-binding policy and procedural
guidance.” EPA, GUIDELINES FOR ENSURING AND
MAXIMIZING THE QUALITY, OBJECTIVITY, UTILITY, AND
INTEGRITY OF INFORMATION DISSEMINATED BY THE
ENVIRONMENTAL PROTECTION AGENCY 4 (2002). Mississippi
points to nothing indicating that any part of this scheme
committed EPA to having done things differently. See
American Petroleum Institute v. EPA, 684 F.3d 1342, 1348
(D.C. Cir. 2012); see also Salt Institute v. Leavitt, 440 F.3d
156, 159 (4th Cir. 2006).
Measuring Mississippi’s challenge to EPA’s use of the
scientific evidence against the agency’s legal obligations, we
see nothing to suggest EPA acted improperly, particularly
given our approval of its ultimate decision to revise the
NAAQS. To start, Mississippi’s challenge to EPA’s use of the
Adams studies—a set of controlled human exposure studies
that played a relatively significant role in the NAAQS review
process—is nothing more than a claim that EPA did wrong by
disagreeing with Adams’s interpretation of his data.
(Although Adams concluded his 2006 study did not show
20
statistically significant lung function decrements at the 0.06
ppm ozone exposure level, EPA explained that it believed a
different statistical model would more directly address the
precise question with which it was concerned—namely, the
effects of prolonged ozone exposure versus exposure to
filtered air—and that application of this model yielded
statistically significant results at the 0.06 ppm level.) Yet
nothing in the Clean Air Act or the IQA prohibits EPA from
independently analyzing the science—for example, by asking
“different questions” from those asked by the study’s author,
2008 Final Rule, 73 Fed. Reg. at 16,455—and the only
objections Mississippi offers to EPA’s independent analysis
are either conclusory or require us to weigh in on what is
apparently legitimate scientific debate. See id. (noting
approval by members of CASAC of the statistical approach
used in the reanalysis). 3
Mississippi’s challenge to EPA’s use of the
epidemiological evidence fares no better. Though it claims
EPA improperly relied on studies using ambient ozone data as
a proxy for personal exposure, Mississippi neither challenges
EPA’s explanation that very few epidemiological studies
directly measuring personal exposure exist in the literature
nor acknowledges EPA’s recognition that ambient
measurements do not necessarily represent personal exposure
levels and must therefore be used with caution. We have no
problem with EPA’s reliance on actual, rather than
3
To the extent Mississippi’s complaint centers around EPA’s
failure to peer review its reanalysis, we note that EPA’s IQA
guidelines expressly disclaim a categorical peer-review policy, so
even assuming Mississippi is right that the reanalysis was not peer
reviewed, Mississippi’s failure to explain why the alleged lack of
peer review was improper is fatal. See American Petroleum
Institute, 684 F.3d at 1348–49.
21
nonexistent, evidence, and in any event, Mississippi does not
challenge EPA’s interpretation of the measurement
disparity—that if the disparity biases the epidemiological
evidence, it does so by underestimating ozone’s health
effects. See 2007 Proposed Rule, 72 Fed. Reg. at 37,839.
Finally, Mississippi’s belief that EPA ignored contradictory
evidence is an example of its own confirmation bias.
Mississippi insists EPA failed to account for studies
suggesting that findings of ozone-related health effects may
be confounded by the presence of other pollutants, but this
challenge boils down to a claim about two epidemiological
studies. EPA mentions only one of these studies—and only
once—in the final rule, and in doing so, it also cites two other
studies (which Mississippi does not challenge) for the same
proposition. See 2008 Final Rule, 73 Fed. Reg. at 16,446.
Even granting the substance of Mississippi’s assertions
(which we do not), it is hard to imagine how eliminating both
studies from EPA’s NAAQS calculation would have altered
EPA’s ultimate decision. 4
We repeat: it is not our job to referee battles among
experts; ours is only to evaluate the rationality of EPA’s
decision, and as we have explained, the agency did its part.
And because we reject Mississippi’s challenge to the primary
NAAQS, we must also reject its challenge to the secondary
NAAQS. Mississippi’s petition for review is therefore denied.
III.
As discussed above, EPA’s review of the available
scientific evidence led it to adopt a primary ozone NAAQS of
4
EPA also cited the two studies a total of five times in the
proposed rule, but we think this immaterial in light of Mississippi’s
failure to explain their importance to EPA’s final decision.
22
0.075 ppm. While Mississippi criticized EPA’s decision to
reduce this standard from its prior level of 0.08 ppm, multiple
state and local governments, environmental advocacy non-
profits, and public health non-profits contend that EPA did
not go far enough. Thus, EPA finds itself in a situation
reminiscent of Goldilocks and the Three Bears. On one side,
Mississippi argued that EPA is too stringent with its ozone
NAAQS; on the other side, the governmental and
environmental petitioners argue that the NAAQS is too lax.
But unlike Goldilocks, this court cannot demand that EPA get
things “just right.” Rather, for EPA’s decision to survive these
challenges, it need do no more than meet the statutory
standards found in the Clean Air Act. “That the evidence in
the record may also support other conclusions, even those that
are inconsistent with [EPA’s], does not prevent us from
concluding that [its] decisions were rational . . . .” Lead
Industries Ass’n, 647 F.2d at 1160 (footnote and citations
omitted).
The Act requires us to overturn any EPA action that is
arbitrary, capricious, an abuse of discretion, or contrary to
law. 42 U.S.C. § 7607(d)(9)(A). The governmental and
environmental petitioners argue that EPA’s judgment—that a
primary ozone NAAQS of 0.075 ppm is “requisite to protect
the public health,” 42 U.S.C. § 7409(b)(1)—was arbitrary and
capricious because EPA failed to rationally consider scientific
evidence demonstrating adverse health effects at ozone levels
below 0.075 ppm. They also argue that EPA acted contrary to
law because it failed to calculate an adequate margin of
safety, as required by section 109(b)(1) of the Act, 42 U.S.C.
§ 7409(b)(1). Finally, they argue that EPA violated its
statutory duty to explain and defend its decision to depart
from CASAC’s recommendations. See id. § 7607(d)(3), (6).
We address each of these arguments in turn.
23
A.
It is true that “[a]n agency’s failure adequately to
consider a relevant and significant aspect of a problem may
render its rulemaking arbitrary and capricious.” American
Farm Bureau, 559 F.3d at 520. But the corollary to EPA’s
obligation to “weigh the entire record,” Achernar
Broadcasting Co. v. FCC, 62 F.3d 1441, 1446 (D.C. Cir.
1995), is that no single piece of evidence is dispositive. See
American Farm Bureau, 559 F.3d at 525; see also ATA III,
283 F.3d at 379. Moreover, “we do not determine the
convincing force of evidence, nor the conclusion it should
support, but only whether the conclusion reached by EPA is
supported by substantial evidence when considered on the
record as a whole.” Coalition for Responsible Regulation, Inc.
v. EPA, 684 F.3d 102, 122 (D.C. Cir. 2012) (per curiam).
Provided EPA meets its obligation “to explain and
expose every step of its reasoning,” American Lung Ass’n v.
EPA, 134 F.3d 388, 392 (D.C. Cir. 1998), the governmental
and environmental petitioners have a heavy burden to show
that the totality of the evidence required EPA to decide
differently than it did. Lead Industries Ass’n, 647 F.2d at
1160. This approach to giant administrative records is
consistent with the deference principles discussed above. See
Part II, supra at 14. Our role is circumscribed. We are merely
to “determin[e] if [EPA] made a rational judgment,” not to
“weigh the evidence anew and make technical judgments.”
Costle, 665 F.2d at 1185.
The governmental and environmental petitioners argue
that EPA failed to grapple with three major types of evidence
that they claim favor a lower primary ozone NAAQS:
controlled human exposure studies, epidemiological studies,
and human exposure and health risk assessments. The record
reveals, and petitioners do not dispute, that EPA considered
24
the entire body of scientific evidence available to it,
discussing each type of evidence at each stage of its analysis.
See, e.g., 2007 Proposed Rule, 72 Fed. Reg. at 37,864–68;
2008 Final Rule, 73 Fed. Reg. at 16,452–70; see also id. at
16,439 (describing the range of evidence considered in the
years-long review process). The petitioners argue instead that
EPA’s conclusion that a level of 0.075 ppm is “requisite” to
protect public health cannot be rationally drawn from this
evidence. We disagree. EPA’s treatment of the evidence
satisfies our deferential standard of review.
Petitioners argue that the controlled human exposure
studies—in particular, the Adams studies—support a more
protective primary NAAQS because they demonstrate adverse
effects at the 0.060 ppm level. The Adams studies, published
in 2002 and 2006, analyzed the results of laboratory
experiments that directly measured the effects of ozone on
humans’ respiratory health by exposing thirty subjects to
ozone in a controlled environment. Adams tested his subjects
at various ozone concentrations, including 0.08 ppm and 0.06
ppm, but at no levels in between. He found that a small
number of subjects exposed to ozone at 0.06 ppm experienced
lung function decrements of at least ten percent—a level EPA
considers to be harmful (or “adverse”) to asthmatics. See 2008
Final Rule, 73 Fed. Reg. at 16,454–55. Petitioners argue that
the 0.06 ppm Adams results were “unrebutted ‘substantial
evidence’ ” favoring a lower standard, and that EPA’s
decision to set the standard as high as 0.075 ppm “ ‘is not
supported by substantial evidence.’ ” Environmental
Petitioners’ Br. 19 (quoting City of Naples Airport Authority
v. FAA, 409 F.3d 431, 436 (D.C. Cir. 2005)). The crux of the
dispute is whether EPA rationally treated this evidence of
adverse effects as not dispositive.
25
EPA relied on the Adams studies and other clinical
studies to justify its decision to lower the primary ozone
NAAQS from the 0.08 ppm level, concluding that they
“provide[d] the most certain evidence of adverse health
effects” at 0.080 ppm available. 2008 Final Rule, 73 Fed.
Reg. at 16,478. EPA also conducted a reanalysis of the
Adams (2006) study that found “small group mean
decrements in lung function responses to be statistically
significant at the 0.060 ppm exposure level.” Id. at 16,454.
But EPA further concluded that the data at the 0.060 ppm
level was too limited to support a reduction in the NAAQS to
that level.
Each Adams study involved only thirty subjects, of which
six at most experienced lung function decrements of ten
percent or more at exposure levels below 0.080 ppm. 5 For this
reason, the CASAC scientists had mixed views about the
Adams studies. For instance, one scientific advisor stated that
the number of data points in the Adams studies was “pitiful,”
and that the limited nature of the data was “astounding.”
Letter from Dr. Rogene Henderson, CASAC Chair, to
5
The record includes conflicting accounts of the number of
participants experiencing lung function decrements of ten percent
or larger at 0.06 ppm. All accounts indicate that it was a small
number, and never more than six. The precise number appears to
depend on one’s method of measuring lung function decrements.
Compare OFFICE OF AIR QUALITY PLANNING AND STANDARDS,
EPA, REVIEW OF THE NATIONAL AMBIENT AIR QUALITY
STANDARDS FOR OZONE: POLICY ASSESSMENT OF SCIENTIFIC AND
TECHNICAL INFORMATION (“STAFF PAPER”), § 3.3.1.1.1 (2007),
EPA-452/R-07-007, with Letter from Dr. Rogene Henderson,
CASAC Chair, to Stephen L. Johnson, EPA Administrator (“Mar.
2007 CASAC Letter”), at C-31–32 (Mar. 26, 2007), EPA-CASAC-
07-002.
26
Stephen L. Johnson, EPA Administrator (“Mar. 2007 CASAC
Letter”), at C-31–32 (Mar. 26, 2007), EPA-CASAC-07-002.
Another cautioned that the responses Adams recorded at the
0.06 ppm level might merely reflect “normal variations” in
human lung function rather than “real ozone responses.” Oct.
2006 CASAC Letter, at D-14. In other words, other factors
apart from a change in ozone levels—for example, participant
fatigue or diminished effort—might explain the “decrements”
that Adams observed. Adams himself was critical of those
who drew strong conclusions from his results at the 0.06 ppm
level because he determined that the average responses were
not statistically significant. See William C. Adams, Comment
on EPA Memorandum: The Effects of Ozone on Lung
Function at 0.06 ppm in Healthy Adults (Oct. 9, 2007), EPA-
HQ-OAR-2005-0172-4783. Ultimately, although EPA
disagreed with Adams regarding the statistical significance of
some results, it found that the study’s small sample size could
not “appropriately be generalized to the U.S. population.”
2008 Final Rule, 73 Fed. Reg. at 16,454, 16,478.
Thus, while the 0.08 ppm results were robust, EPA
rationally treated the 0.06 ppm results as inconclusive.
Perhaps more studies like the Adams studies will yet reveal
that the 0.060 ppm level produces significant adverse
decrements that simply cannot be attributed to normal
variation in lung function. But at the time of EPA’s
rulemaking, it was rational to treat the 0.06 ppm results with
skepticism. The Adams results at 0.06 ppm indicate some
degree of risk that some number of individuals might continue
to experience health effects at and below 0.075 ppm, but we
have previously acknowledged the impossibility of
eliminating all risk of health effects from “non-threshold”
pollutants like ozone. See ATA III, 283 F.3d at 360 (“The lack
of a threshold concentration below which these pollutants are
known to be harmless makes the task of setting primary
27
NAAQS difficult, as EPA must select standard levels that
reduce risks sufficiently to protect public health even while
recognizing that a zero-risk standard is not possible.” (internal
quotation marks and original alterations omitted)).
Petitioners counter that EPA has relied on even
statistically nonsignificant results in the past when setting the
primary ozone NAAQS, so the limitations of the Adams
studies provide no basis for dismissing the evidence of
adverse effects at that level. Environmental Petitioners’ Br.
20–21. Be that as it may, the question for this court is not
what EPA has done in the past, or even what levels it
rationally could have settled on, but only whether it has
provided a rational explanation of how it treated the evidence
before it. See ATA III, 283 F.3d at 374 (“[W]e review [EPA’s]
scientific judgments . . . not as the chemist, biologist, or
statistician that we are qualified neither by training nor
experience to be, but as a reviewing court exercising our
narrowly defined duty of holding agencies to certain minimal
standards of rationality.” (quoting Troy Corp. v. Browner, 120
F.3d 277, 283 (D.C. Cir. 1997)). Statistical quality affords a
perfectly rational basis for assigning different weights to
different pieces of scientific data when evaluating the totality
of the evidence. While EPA is certainly permitted to look to
statistically uncertain results, it is by no means required to
rely on them. Its failure to do so in this case did not render its
decision irrational.
The governmental and environmental petitioners next
argue that EPA gave short shrift to the epidemiological
studies. By using statistical techniques to analyze vast bodies
of health and environmental data across large populations,
epidemiological studies allow scientists to draw inferences
about the harms of ozone without carefully calibrated
laboratory experiments. EPA relied on over 250 such studies
28
during its 2008 rulemaking. 2008 Final Rule, 73 Fed. Reg. at
16,455, 16,479. Petitioners point out that some studies found
significant correlations between ozone concentration and
adverse health outcomes at levels well below 0.075 ppm. See
Comments of the American Lung Association, Environmental
Defense, Sierra Club on the U.S. Environmental Protection
Agency’s Proposed Revisions to the NAAQS for Ozone (Oct.
9, 2007), EPA-HQ-OAR-2005-0172-4261; Comments of
American Thoracic Society, et al. (Oct. 9, 2007), EPA-HQ-
OAR-2005-0172-4305. The studies were relatively consistent,
and the results—as EPA admits—may help establish a causal
relationship between the presence of ozone and the
occurrence of adverse health effects. 2008 Final Rule, 73 Fed.
Reg. at 16,450.
As with the Adams studies, EPA relied on the
epidemiological studies to conclude that the existing standard
of 0.08 ppm was too high. EPA noted that many
epidemiological studies reported “statistically significant
associations that generally extend down to ambient O3
concentrations that are below the level of the current
standard” and considered these studies as part of the body of
“new evidence demonstrating that exposures to O3 at levels
below the level of the current standard are associated with a
broad array of adverse health effects.” Id. at 16,471. EPA also
explained, however, that “the epidemiological studies are not
themselves direct evidence of a causal link between exposure
to O3 and the occurrence of [health] effects,” id. at 16,479,
and that evidence of this causal relationship “becomes
increasingly uncertain at lower levels of exposure.” Id. at
16,478. EPA explained this uncertainty by reference to
intrinsic indicators of reliability and extrinsic sources of
corroboration, both of which provide substantial evidence for
EPA’s decision. For example, at much lower levels of ozone
exposure, EPA questioned whether it could attribute the
29
epidemiological effects to ozone alone “rather than to the
broader mix of air pollutants present in the ambient air.” Id. at
16,456; see also EPA, Responses to Significant Comments on
the 2007 Proposed Rule, at 29 (Mar. 2008), EPA-HQ-OAR-
2005-0172-7185. Additionally, EPA relied on controlled
studies like the Adams studies to lend “biological plausibility”
to the inferences of causation drawn from epidemiological
studies. According to EPA, while “[t]he biological plausibility
of the epidemiological associations is generally supported by
controlled human exposure and toxicological evidence of
respiratory morbidity effects for levels at and below 0.080
ppm,” that “biological plausibility becomes increasingly
uncertain at much lower levels.” 2008 Final Rule, 73 Fed.
Reg. at 16,456. EPA’s discussion of the limitations of the
epidemiological studies at lower levels of ozone exposure
satisfies the “minimal standards of rationality” to which we
hold the agency. See National Environmental Development
Ass’n’s Clean Air Project, 686 F.3d at 810 (internal quotation
marks omitted).
Petitioners also challenge EPA’s interpretation of its own
risk and exposure assessments. EPA did not rely heavily on
them, though petitioners think it should have. These
assessments model real-world interactions between a host of
variables in order to predict health outcomes based on
available data. 2008 Final Rule, 73 Fed. Reg. at 16,441. As
such, they adhere to the inviolable law of data analysis,
“garbage in; garbage out.” That is, as CASAC cautioned EPA,
the risk and exposure assessments are only as reputable as the
inputs upon which they rely to produce their predictions. Oct.
2006 CASAC Letter, at 12; see also Letter from Dr. Rogene
Henderson, CASAC Chair, to Stephen L. Johnson, EPA
Administrator, at D-39 (Feb. 10, 2006), EPA-CASAC-06-003
(discussing similar weaknesses in risk assessment for the
secondary NAAQS). In this case, the inputs were the very
30
data whose reliability EPA questioned at lower levels.
Recognizing their limitations, we have previously approved
EPA’s cautious treatment of risk and exposure assessments
when EPA “consider[s] all aspects of the problem” and
“catalogue[s] its concerns.” See American Farm Bureau, 559
F.3d at 527. We do the same now.
Having reasonably explained the limitations it believed
existed in each of these bodies of scientific evidence, EPA
concluded that the standard “must be set at a level appreciably
below 0.080 ppm, the level at which there is considerable
evidence of effects in healthy people.” 2008 Final Rule, 73
Fed. Reg. at 16,480; see also id. at 16,483 (“0.080 ppm [is]
the level in controlled human exposure studies at which
adverse effects have been demonstrated.”). EPA concluded
that a standard set at 0.075 ppm “would be requisite to protect
public health with an adequate margin of safety, including the
health of sensitive subpopulations.” Id. at 16,483. EPA
explained that a standard lower than 0.075 ppm was not
required because it “would only result in significant further
public health protection if, in fact, there is a continuum of
health risks in areas with 8-hour average O3 concentrations
that are well below the concentrations observed in the key
controlled human exposure studies and if the reported
associations observed in epidemiological studies are, in fact,
causally related to O3 at those lower levels.” Id. Based on the
uncertainties EPA had identified “in interpreting the evidence
from available controlled human exposure and
epidemiological studies at very low levels,” EPA was “not
prepared to make these assumptions.” Id. Finding that “the
likelihood of obtaining benefits to public health with a
standard set below 0.075 ppm O3 decreases, while the
likelihood of requiring reductions in ambient concentrations
that go beyond those that are needed to protect public health
increases,” EPA judged that “the appropriate balance to be
31
drawn” was a standard set at 0.075 ppm. Id. We see nothing
arbitrary and capricious about EPA’s balancing of these
considerations.
B.
The governmental and environmental petitioners next
argue that, even if the scientific evidence of adverse effects at
ozone levels below 0.075 ppm remained uncertain, the
overwhelming evidence of adverse effects at 0.080 ppm
required a primary NAAQS lower than 0.075 ppm to ensure
an adequate margin of safety. EPA is required to “allow[] an
adequate margin of safety” in setting a primary NAAQS that
is “requisite to protect the public health.” 42 U.S.C.
§ 7409(b)(1). By requiring an “adequate margin of safety,”
Congress was directing EPA to build a buffer to protect
against uncertain and unknown dangers to human health.
Lead Industries Ass’n, 647 F.2d at 1154; see also ATA III, 283
F.3d at 368. Our case law has left EPA with a wide berth
when it comes to deciding how best to account for an
adequate margin of safety. In Lead Industries Association, we
held that the choice of how to set a margin of safety is “a
policy choice of the type that Congress specifically left to the
Administrator’s judgment.” 647 F.2d at 1162. And in
American Trucking Associations, we clarified that EPA need
not “identify[] a ‘safe level’ and then apply[] an additional
margin of safety”; instead, it may “take into account margin
of safety considerations throughout the process as long as
such considerations are fully explained and supported by the
record.” ATA III, 283 F.3d at 368 (internal quotation marks
omitted).
In light of this deferential standard, we have only rarely
found that the agency failed to build in a margin of safety.
See, e.g., American Farm Bureau, 559 F.3d at 525–26
(granting the petition for review in part because EPA failed to
32
account for a margin of safety). When we have, it has not
been on the basis of our own untutored judgment about how
large a margin is necessary, but rather for egregious
procedural errors, such as EPA’s failure to consider sensitive
sub-populations, like asthmatics, children, or the elderly. See
id. In this case, no such problem presents itself; EPA regularly
and consistently considered the effects of its rules on these
sensitive groups. See, e.g., 2008 Final Rule, 73 Fed. Reg. at
16,476. EPA acknowledged that some of these subpopulations
are more likely to experience adverse effects at all levels of
exposure, requiring it to select a primary NAAQS level below
the level at which adverse effects occur “with reasonable
scientific certainty.” See id. at 16,437 (explaining the purpose
of the margin of safety); id. at 16,449 (describing CASAC’s
conclusion that existing studies do not adequately cover
sensitive subpopulations); id. at 16,452 (adopting that
conclusion in part). As a result, EPA set the standard
“appreciably below” 0.080 ppm, the lowest level at which
EPA expressed confidence that ozone causes adverse health
effects in healthy individuals. Id. at 16,480. Petitioners have
given us no reason to doubt EPA’s characterization of the
0.075 ppm level as “appreciably below” 0.080 ppm. EPA
complied with Congress’s command in section 109(b)(1) to
build in a margin of safety, and its judgment that this margin
is adequate was not arbitrary or capricious.
C.
The governmental and environmental petitioners next
argue that EPA failed to uphold its duty under the Act to
provide “an explanation of the reasons” for departing from
CASAC’s recommendations. 42 U.S.C. § 7607(d)(3); see also
id. § 7607(d)(6)(A). Congress created CASAC in the 1977
Clean Air Act Amendments and tasked it with providing
scientific advice to aid EPA in setting NAAQS. See id.
§ 7409(d)(2). Expressing its “desire for continued
33
independent scientific review of the Environmental Protection
Agency’s exercise of judgment,” H. Rep. No. 95-294, at 182
(1977), Congress directed CASAC to complete a review of
the air quality criteria and primary and secondary NAAQS
every five years and to “recommend to the Administrator any
new national ambient air quality standards and revisions of
existing criteria and standards as may be appropriate,” 42
U.S.C. § 7409(d)(2)(B).
When Congress created CASAC, the promulgation of
NAAQS was in its infancy. In describing the role it
envisioned for CASAC, Congress emphasized the valuable
role that advisory committees and expert groups had played in
reviewing the first criteria documents and air quality
standards issued in the late 1960s and early 1970s, explaining
that “[f]or nearly 10 years the scientific basis for setting
ambient air quality standards has been reviewed, evaluated,
subjected to outside criticism, and reevaluated.” H. Rep. No.
95-294, at 179–81. CASAC was intended to replicate this role
by “provid[ing] an independent source of review and advice
to the Administrator and to the Congress.” Id. at 182. Thus,
Congress explained that it established CASAC “[b]ecause of
the admitted need for greater research, the importance of the
national ambient air quality standards, the continuing
controversy over the standards, and the committee’s desire for
continued independent scientific review of the Environmental
Protection Agency’s exercise of judgment.” Id.
Congress expected that CASAC’s central role would be
one of scientific analysis, explaining that CASAC’s “main
function” was “to assess the health and environmental effects
of ambient air pollution.” Id. at 183. CASAC would “provide
an outside mechanism for evaluating whether any pollutant
may reasonably be anticipated to endanger public health or
environment, for evaluating the scientific and medical data
34
which might bear on this question, and for reviewing gaps in
the available data and recommending additional needs for
research.” Id. at 182. Given these functions, Congress
expected that CASAC members would “be selected on the
basis of their special expertise” in fields such as
“environmental toxicology, epidemiology and/or clinical
medicine.” Id. at 183.
Congress also required EPA to take CASAC’s expert
scientific recommendations into account in promulgating
NAAQS. Although EPA is not bound by CASAC’s
recommendations, it must fully explain its reasons for any
departure from them. Specifically, section 307(d)(3) of the
Act mandates that when EPA proposes to issue new NAAQS
or revise existing NAAQS, the proposed rule must include a
“statement of its basis and purpose” that “set[s] forth or
summarize[s] and provide[s] a reference to any pertinent
findings, recommendations, and comments by [CASAC].” 42
U.S.C. § 7607(d)(3). If EPA’s “proposal differs in any
important respect from any of [CASAC’s] recommendations,”
the proposed rule must provide “an explanation of the reasons
for such differences.” Id. Section 307(d)(6) of the Act
requires that the final promulgated rule must also “be
accompanied by . . . a statement of basis and purpose like that
referred to in paragraph (3) with respect to a proposed rule.”
Id. § 7607(d)(6)(A). Thus if, as here, EPA departs from
CASAC’s recommendations in the final rule, EPA must also
explain there its reasons for doing so. See American Farm
Bureau, 559 F.3d at 521 (concluding that EPA failed in the
final rule “adequately to explain its reason for not accepting
the CASAC’s recommendations”).
Congress intended that CASAC’s expert scientific
analysis aid not only EPA in promulgating NAAQS but also
the courts in reviewing EPA’s decisions. As Congress
explained, CASAC’s “views are to be included in the record
35
of any such rulemaking proceeding and, therefore, to be
considered by the courts in reviewing the Administrator’s
action or inaction.” H. Rep. No. 95-294, at 182–83. In order
to enable judicial review and to satisfy its statutory obligation
to explain its reasons for departing from CASAC, EPA must
be precise in describing the basis for its disagreement with
CASAC. If EPA’s quarrel is with CASAC’s scientific
analysis, then in order to preserve the integrity of CASAC’s
scientific role, EPA must give a sound scientific reason for its
disagreement. In reviewing such scientific explanations, we
undertake a “searching and careful” inquiry into the facts “to
ascertain whether there is substantial evidence in the record
when considered as a whole which supports the
Administrator’s determinations.” Lead Industries Ass’n, 647
F.2d at 1145–46 (internal quotation marks omitted).
Alternatively, EPA could accept CASAC’s scientific analysis
yet explain the policy considerations that led it to select a
different level than that recommended by CASAC. See id. at
1147. Of course, EPA’s policy judgments “are not susceptible
to the same type of verification or refutation by reference to
the record as are some factual questions,” and thus “our
paramount objective” in reviewing them “is to see whether
the agency, given an essentially legislative task to perform,
has carried it out in a manner calculated to negate the dangers
of arbitrariness and irrationality.” National Lime Ass’n v.
EPA, 627 F.2d 416, 431 n.48 (D.C. Cir. 1980) (internal
quotation marks omitted).
In this case, the CASAC Ozone Review Panel was
composed of twenty-three scientists who are professors,
analysts, and other practitioners in fields such as medicine,
anatomy, environmental science, and chemical engineering.
Drawing on this substantial expertise, the twenty-three
members of the panel, in an October 2006 letter to EPA
following CASAC’s peer review of the second draft of the
36
agency’s Ozone Staff Paper, unanimously recommended that
“the current primary ozone NAAQS be revised and that the
level that should be considered for the revised standard be
from 0.060 to 0.070 ppm.” Oct. 2006 CASAC Letter, at 5. In
explaining the basis for this recommendation, CASAC noted
that “[a] large body of data clearly demonstrates adverse
human health effects at the current level of the 8-hr primary
ozone standard.” Id. According to CASAC, “[r]etaining this
standard would continue to put large numbers of individuals
at risk for respiratory effects and/or significant impact on
quality of life including asthma exacerbations, emergency
room visits, hospital admissions and mortality.” Id.
CASAC also noted a large body of studies providing
“evidence for adverse health effects at concentrations lower
than the current standard.” Id. at 3. Among this evidence was
a “broad range of epidemiologic and controlled exposure
studies” observing multiple “adverse health effects due to
low-concentration exposure to ambient ozone.” Id. at 4. In
addition, CASAC explained that the Adams (2006) study had
observed “[s]tatistically-significant decrements in lung
function . . . at the 0.08 ppm exposure level,” as well as
“adverse lung function effects . . . in some individuals at 0.06
ppm.” Id. at 3. CASAC also noted that “these findings were
observed in healthy volunteers” and that asthmatics and
children had been found in other studies “to be more sensitive
and to experience larger decrements in lung function in
response to ozone exposures than would healthy volunteers.”
Id. at 4. Finally, pointing to the exposure and risk
assessments, CASAC explained that “a significant decrease in
adverse effects due to ozone exposures can be achieved by
lowering the exposure concentrations below the current
standard,” noting that “[b]eneficial effects in terms of
reduction of adverse health effects were calculated to occur at
the lowest concentration considered (i.e., 0.064 ppm).” Id. On
37
the basis of all this evidence, CASAC concluded that “the
current primary 8-hr standard of 0.08 ppm needs to be
substantially reduced to be protective of human health,
particularly in sensitive subpopulations” and that the standard
should be set within the range of 0.060 to 0.070 ppm. Id. at 4–
5. CASAC reiterated this recommendation in a March 2007
letter to EPA, underscoring that “overwhelming scientific
evidence” supported its recommendation “that the level of the
current primary ozone standard should be lowered from 0.08
ppm to no greater than 0.070 ppm.” Mar. 2007 CASAC
Letter, at 2.
When EPA issued its notice of proposed rulemaking, it
proposed to revise the primary ozone standard to within a
range from 0.070 ppm, the high end of CASAC’s
recommended range, to 0.075 ppm. 2007 Proposed Rule, 72
Fed. Reg. at 37,878. EPA explained why it believed a
standard set below 0.070 ppm would be inappropriate. Id. at
37,880. In the final rule, EPA departed from CASAC’s
recommended range and set the standard at 0.075 ppm. EPA
acknowledged that this standard was “above the range
recommended by the CASAC.” 2008 Final Rule, 73 Fed. Reg.
at 16,482. In explaining its departure, EPA catalogued its
disputes with CASAC over the interpretation of specific
bodies of scientific evidence and also noted that “the basis for
[CASAC’s] recommendation appears to be a mixture of
scientific and policy considerations.” Id. “[T]here is,” EPA
stated, “no bright line clearly directing the choice of level, and
the choice of what is appropriate is clearly a public health
policy judgment entrusted to the Administrator.” Id. at
16,482–83. In explaining this policy judgment, EPA reasoned
that “[a] standard set at a level lower than 0.075 would only
result in significant further public health protection if, in fact,
there is a continuum of health risks in areas with 8-hour
average O3 concentrations that are well below the
38
concentrations observed in the key controlled human
exposure studies and if the reported associations observed in
epidemiological studies are, in fact, causally related to O3 at
those lower levels.” Id. at 16,483. “Based on the available
evidence,” EPA declared that it was “not prepared to make
these assumptions.” Id. “Taking into account the uncertainties
that remain in interpreting the evidence from available
controlled human exposure and epidemiological studies at
very low levels,” EPA concluded that “the likelihood of
obtaining benefits to public health with a standard set below
0.075 ppm O3 decreases, while the likelihood of requiring
reductions in ambient concentrations that go beyond those
that are needed to protect public health increases.” Id. EPA
thus “judge[d] that the appropriate balance to be drawn, based
on the entire body of evidence and information available in
this review, is a standard set at 0.075.” Id.
This explanation rests largely on EPA’s policy judgment
about the appropriate NAAQS level. We have explained that,
where EPA operates within the realm of uncertain science, its
decisions about the appropriate NAAQS level must
“necessarily . . . rest largely on policy judgments.” Lead
Industries Ass’n, 647 F.2d 1147 (internal quotation marks
omitted). But this presupposes that the scientific evidence is
actually uncertain—a question that itself requires a scientific
determination. EPA did not make such a specific scientific
determination about the 0.070 ppm level that served as the
ceiling of CASAC’s recommendation; instead, EPA referred
generally to declining certainty below 0.075 ppm. Had
CASAC reached a scientific conclusion that adverse health
effects were likely to occur at the 0.070 ppm level, EPA’s
failure to justify its uncertainty regarding the existence of
39
adverse health effects at this level would be unacceptable. 6
Indeed, it is a familiar principle that agencies may not
“merely recite the terms ‘substantial uncertainty’ as a
justification for [their] actions”; instead, they “must explain
the evidence which is available, and must offer a rational
connection between the facts found and the choice made.”
State Farm, 463 U.S. at 52 (internal quotation marks omitted).
In other words, EPA must explain why the evidence on which
CASAC relied cannot support the degree of confidence
CASAC placed in it. This is especially true given the added
layer of stringency imposed by EPA’s obligations under
section 307(d)(6).
But we are unable to determine whether CASAC reached
any such scientific conclusion. Although CASAC stated that
“overwhelming scientific evidence” supported its
recommendation that the standard be set no higher than 0.070
ppm, Mar. 2007 CASAC Letter, at 2, it never explained
whether this proposal was based on its scientific judgment
that adverse health effects would occur at that level or instead
based on its more qualitative judgment that the range it
proposed would be appropriately protective of human health
with an adequate margin of safety. Indeed, although CASAC
concluded that “there is no longer significant scientific
uncertainty regarding [its] conclusion that the current 8-hr
primary NAAQS must be lowered,” given the “large body of
data clearly demonstrat[ing] adverse human health effects at
the current level,” CASAC recognized that “[s]cientific
uncertainty does exist with regard to the lower level of ozone
6
This conclusion concerns only disagreements regarding the
certainty of the science; of course, EPA could also have accepted
CASAC’s scientific conclusion and explained its view that any
health effects at that level were not severe enough to be considered
“adverse.”
40
exposure that would be fully-protective of human health.”
Oct. 2006 CASAC Letter, at 5.
To be sure, EPA’s statutory obligation to respond to
CASAC does not evaporate whenever CASAC exercises
judgment amidst scientific uncertainty. Quite to the contrary,
had CASAC acknowledged uncertainty in the scientific
evidence but explained that, based on its expert scientific
judgment, it nonetheless believed adverse health effects were
likely to occur at the 0.070 ppm level, then section 307(d)(6)
would have required EPA to explain why it disagreed with
this scientific conclusion. Put differently, to the extent that
CASAC has exercised scientific judgment, EPA must respond
in kind. But because CASAC never made clear the precise
basis for its recommendation, all we know for certain is this:
both CASAC and EPA believed the existence of adverse
health effects to be certain at the 0.08 ppm level and reached
differing conclusions about what level below 0.08 ppm was
requisite to protect the public health with an adequate margin
of safety.
The task of determining what standard is “requisite” to
protect the qualitative value of public health or what margin
of safety is “adequate” to protect sensitive subpopulations
necessarily requires the exercise of policy judgment. Here,
EPA’s policy judgment was informed by its view of the
limitations of the scientific evidence—namely, that at lower
levels of ozone exposure, the clinical and epidemiological
studies provide less conclusive evidence of the existence of
adverse health effects. See 2008 Final Rule, 73 Fed. Reg. at
16,483 (noting “the uncertainties that remain in interpreting
the evidence from available controlled human exposure and
epidemiological studies at very low levels”). Striking a
balance between “the increasing uncertainty associated with
[its] understanding of the likelihood of such effects at lower
41
O3 exposure levels” and “concern about the potential for
health effects and their severity,” id. at 16,477, EPA set the
standard at 0.075 ppm, a level the agency believed to be
“appreciably below” the 0.08 ppm level at which both EPA
and CASAC expressed certainty about the existence of
adverse health effects, id. at 16,483. Absent a definitive
scientific conclusion from CASAC that adverse health effects
would occur at the 0.070 ppm level, we must assume that it
too took these same considerations into account and simply
exercised its judgment to recommend a standard set at a lower
level. Although both CASAC and EPA must exercise public
health policy judgment when confronted with scientific
evidence that does not direct it to a specific outcome, it is to
EPA’s judgment that we must defer.
In our view, this conclusion is perfectly consistent with
the role Congress intended CASAC to play in the NAAQS-
setting process. In order to ensure that EPA’s NAAQS
decisions rest on sound scientific judgment, Congress
required EPA not only to describe CASAC’s
recommendations in any rulemaking but also, if it departs
from such recommendations, to explain its reasons for doing
so. See 42 U.S.C. § 7607(d)(3), (6). But in order for EPA to
explain adequately its reasons for disagreeing with CASAC,
CASAC itself must be precise about the basis for its
recommendations. Because in this case CASAC failed to
specify whether the 0.070 ppm level it recommended as a
maximum rested on a scientific conclusion about the
existence of adverse health effects at that level, EPA’s
invocation of scientific uncertainty and more general public
health policy considerations satisfies its obligations under the
statute.
42
IV.
We turn finally to EPA’s decision to set the secondary
ozone NAAQS “identical in every way to the revised primary
standard.” 2008 Final Rule, 73 Fed. Reg. at 16,500. The
governmental and environmental petitioners argue, among
other things, that EPA’s failure to “specify a level of air
quality . . . [that] is requisite to protect the public welfare,” 42
U.S.C. § 7409(b)(2), violates the statute as interpreted in our
decision in American Farm Bureau. Because we agree that
EPA’s justification for the secondary standard is inadequate
under American Farm Bureau, we need not reach petitioners’
other arguments.
As described above, the Clean Air Act requires secondary
NAAQS to “specify a level of air quality the attainment and
maintenance of which . . . is requisite to protect the public
welfare from any known or anticipated adverse effects
associated with the presence of such air pollutant in the
ambient air.” Id. Regarding ozone, EPA set the secondary
NAAQS in 1997 to protect against harmful effects on
vegetation and indirect effects on other ecosystem
components. See 2008 Final Rule, 73 Fed. Reg. at 16,485. In
the current review of the secondary standard, before EPA
came to its final decision, agency staff examined new
scientific evidence and risk assessments that evaluated
ozone’s welfare effects. Id. On the basis of this new evidence,
EPA staff concluded that the existing 0.08 ppm 8-hour
standard was inadequate because ozone at that level directly
causes adverse effects to vegetation and has indirect adverse
effects on soil, water, and wildlife. 2007 Proposed Rule, 72
Fed. Reg. at 37,883, 37,897–99. EPA staff also considered
whether the evidence still justified a standard that measured
ozone over an 8-hour interval or whether instead the
secondary standard should measure ozone cumulatively over
a seasonal period. Id. at 37,882–83. In the end, EPA staff
43
found that new evidence about the cumulative effect of ozone
on vegetation supported a seasonal standard and
recommended that the agency consider a range of seasonal
levels between 7 and 21 ppm-hours. Id. at 37,900, 37,903.
CASAC unanimously agreed with EPA staff that adverse
effects on vegetation occur under the existing standard and
that “it is not appropriate to try to protect vegetation . . . by
continuing to promulgate identical primary and secondary
standards for O3.” 2008 Final Rule, 73 Fed. Reg. at 16,492.
All but one member of the CASAC panel “encourage[d]
[EPA] to establish an alternative cumulative secondary
standard for O3 and related photochemical oxidants that is
distinctly different in averaging time, form and level from the
currently existing or potentially revised 8-hour primary
standard.” 2007 Proposed Rule, 72 Fed. Reg. at 37,899 &
n.62 (internal quotation marks omitted). CASAC also agreed
with EPA staff that the lowest seasonal level that the agency
should consider was 7 ppm-hours, but recommended that
EPA consider a level no higher than 15 ppm-hours. Id. at
37,903.
In the final rule, EPA agreed that new evidence indicates
that ozone causes adverse effects on vegetation and related
ecosystems at the current level of the secondary standard and
concluded that it was appropriate to revise the secondary
standard to provide increased protection. 2008 Final Rule, 73
Fed. Reg. at 16,496, 16,499–500. Regarding the
recommendations to adopt a cumulative seasonal standard,
EPA cited a staff analysis that found “significant overlap”
between counties expected to meet the revised 8-hour primary
standard and counties that would meet a cumulative seasonal
standard. Id. at 16,499. EPA “focused [its] consideration on a
level for an alternative [seasonal] standard at the upper end of
the proposed range (i.e., 21 ppm-hours)” and found
44
“essentially no counties with air quality that would be
expected both to exceed such an alternative [seasonal]
standard and to meet the revised 8-hour primary standard.” Id.
at 16,499–500. From this comparison, EPA concluded that
merely revising the secondary standard to match the revised
primary standard would “provide a significant degree of
additional protection for vegetation” and that “a [seasonal]
standard would be unlikely to provide additional protection in
any areas beyond that likely to be provided by the revised
primary standard.” Id. at 16,499–500. Citing the “significant
uncertainties in determining or quantifying the degree of risk
attributable to varying levels of O3 exposure, the degree of
protection that any specific cumulative, seasonal standard
would produce, and the associated potential for error in
determining the standard that will provide a requisite degree
of protection,” EPA rejected a cumulative seasonal standard
in favor of a secondary standard that was identical to the
revised primary standard. Id. at 16,500.
In American Farm Bureau, we rejected EPA’s
explanation for setting the fine particulate matter secondary
NAAQS—which protects public welfare from adverse
visibility effects—identical to the primary fine particulate
matter standard. 559 F.3d at 530–31. While the primary
standard measured fine particulate matter levels annually,
EPA staff and CASAC had recommended that the secondary
standard measure fine particulate matter over 4- or 8-hour
periods, suggesting a range of appropriate levels for this
alternatively measured standard. Id. at 528. EPA rejected
these recommendations on the ground that the evidence
supporting the recommended alternative standard was
“limited and uncertain,” instead adopting a secondary
standard that was identical to the primary standard. Id. at 529
(internal quotation marks omitted). In so doing, EPA relied on
a comparison purporting to show that the revised primary
45
NAAQS would actually provide slightly more visibility
protection than one proposed level of the alternative standard.
Id.
Relying on the statute’s plain language—EPA “shall
specify a level of air quality the attainment and maintenance
of which . . . is requisite to protect the public welfare from
any known or anticipated adverse effects,” 42 U.S.C.
§ 7409(b)(2)—we rejected EPA’s explanation, finding that
EPA must “determine what level of visibility protection is
requisite to protect the public welfare,” American Farm
Bureau, 559 F.3d at 530. We also found that EPA’s reliance
on the comparison between the primary standard and the
recommended secondary standards “fail[ed] on its own
terms.” Id. “[T]wo-thirds of the potential standards within the
CASAC’s recommended range,” we explained, “would be
substantially more protective than the primary standards,” and
“EPA failed to explain why it looked only at one of the few
potential standards that would be less protective.” Id.
Furthermore, we faulted EPA’s failure to respond to technical
problems with the comparison identified by CASAC and EPA
staff. Id. at 530–31.
Although American Farm Bureau was decided after EPA
issued the rule challenged here, the decision is binding on us
now—a proposition that EPA nowhere disputes. Bradley v.
School Board of City of Richmond, 416 U.S. 696, 714 (1974)
(“[A]n appellate court must apply the law in effect at the time
it renders its decision.” (quoting Thorpe v. Housing Authority
of City of Durham, 393 U.S. 268, 281 (1969))). Indeed, the
statutory requirement that the secondary NAAQS “specify a
level of air quality the attainment and maintenance of
which . . . is requisite to protect the public welfare,” 42 U.S.C.
§ 7409(b)(2), existed when EPA issued the rules at issue in
American Farm Bureau and here.
46
EPA’s explanation for setting the secondary standard
identical to the primary standard fails under American Farm
Bureau. As we explained there, it is insufficient for EPA
merely to compare the level of protection afforded by the
primary standard to possible secondary standards and find the
two roughly equivalent. EPA must expressly “determine what
level of . . . protection is requisite to protect the public
welfare,” American Farm Bureau, 559 F.3d at 530, and
explain why this is so. Here EPA found “significant overlap”
between the revised primary standard and “selected levels” of
a seasonal standard, 2008 Final Rule, 73 Fed. Reg. at 16,499,
and it did say that the revised primary standard “would be
sufficient to protect public welfare from known or anticipated
adverse effects,” id. at 16,500. But it justified this conclusion
only by comparing the revised primary standard to a seasonal
level of 21 ppm-hours that EPA never “specif[ed]” was
“requisite to protect the public welfare,” 42 U.S.C.
§ 7409(b)(2)—exactly what American Farm Bureau held is
inconsistent with the statute.
EPA argues that it “identified a target level of protection
in terms of a cumulative, seasonal standard.” Respondent’s
Br. 122. In support, the agency points to the sentence in the
final rule stating that EPA “focused [its] consideration on a
level . . . at the upper end of the proposed range (i.e., 21 ppm-
hours).” 2008 Final Rule, 73 Fed. Reg. at 16,499–500. But
neither this statement nor anything else EPA said indicated
that the 21 ppm-hours level was “requisite to protect the
public welfare.” Perhaps more importantly, EPA never
explained why a 21 ppm-hours level would, in fact, be
requisite to protect vegetation. That a seasonal standard of 21
ppm-hours was one of the levels proposed by EPA staff
hardly shows that the level was “requisite to protect the public
welfare.”
47
Also as in American Farm Bureau, EPA’s comparison
between the primary and secondary standards “fails on its
own terms.” 559 F.3d at 530. Although the comparison
between the revised 8-hour standard and a seasonal standard
showed that the level of protection afforded by the revised
primary standard would be arguably equivalent to the level of
protection afforded by a 21 ppm-hours seasonal standard, the
comparison also showed that the primary standard would
offer less protection than other seasonal levels within the
range recommended by CASAC and EPA staff. See 2007
Proposed Rule, 72 Fed. Reg. at 37,892–93. In American Farm
Bureau, “EPA failed to explain why it looked only at one of
the few potential standards that would be less protective . . .
than the primary standard,” 559 F.3d at 530; in this case, EPA
failed to explain why it looked only at one potential seasonal
standard that the primary standard would arguably protect as
well as.
At oral argument, counsel for EPA repeatedly insisted
that petitioners “tacitly conceded” that the agency identified a
target level of protection by “criticiz[ing] the reason EPA
focused on 21 [ppm-hours].” Oral Arg. Rec. 1:50:43–51:06;
see also id. 1:50:02–16. But counsel confuses assuming a
premise for the sake of argument with conceding the point.
Petitioners argue both that EPA failed to identify a target level
of protection and that, even if EPA had in fact determined that
the “requisite” level was 21 ppm-hours, that finding was
irrational. See Environmental Petitioners’ Br. 35–37 (“EPA
Acted Illegally and Arbitrarily in Failing to Identify the Level
of Air Quality Requisite to Protect Against Adverse
Vegetation Impacts.”); id. at 37–39 (“EPA’s Decision on the
Secondary Standard Was Irrational.”); id. at 39–40 (“EPA’s
Attempts to Justify Its Secondary Standard Were
Groundless.”). Contending that settling on 21 ppm-hours
48
would be senseless hardly precludes petitioners from arguing
that EPA never expressly made the required determination.
Because EPA failed to determine what level of protection
was “requisite to protect the public welfare,” EPA’s
explanation for the secondary standard violates the Act. We
therefore remand this portion of the final rule for further
explanation or reconsideration by EPA. In the meantime, we
leave the standard in place rather than vacating the rule.
“First, the EPA’s failure adequately to explain itself is in
principle a curable defect. Second, vacating a standard
because it may be insufficiently protective would sacrifice
such protection as it now provides, making the best an enemy
of the good.” American Farm Bureau, 559 F.3d at 528. Given
these principles, neither EPA nor petitioners advocate vacatur.
V.
For the foregoing reasons, we remand the secondary
NAAQS to EPA for reconsideration in view of this opinion.
In all other respects, the petitions for review are denied.
So ordered. | 01-03-2023 | 07-23-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603743/ | 8 So.3d 186 (2008)
Gigi KILHULLEN, Appellant,
v.
KANSAS CITY SOUTHERN RAILWAY and Robert W. Lay, Appellees.
No. 2006-CA-01564-COA.
Court of Appeals of Mississippi.
April 1, 2008.
Rehearing Denied July 22, 2008.
*187 Barry W. Gilmer, Reid S. Bruce, Jackson, attorneys for appellant.
Charles E. Ross, Jackson, William B. Lovett, attorneys for appellees.
Before MYERS, P.J., IRVING and ISHEE, JJ.
IRVING, J., for the Court.
¶ 1. Gigi Kilhullen sued Kansas City Southern Railway (KC Southern) and Robert Lay (collectively, the Appellees), alleging that they caused the wrongful death of her husband, Thomas Kilhullen. Following discovery, the Scott County Circuit Court granted summary judgment on behalf of the Appellees. Aggrieved, Kilhullen appeals and asserts that the court erred (1) in rejecting the affidavit of Jimmy Shelton, whom Kilhullen offered as a lay witness; (2) in rejecting the affidavit of Jimmy Halfacre, an engineer hired by Kilhullen; (3) in rejecting the affidavit of Brett Alexander, an accident reconstructionist hired by Kilhullen; (4) in granting KC Southern and Lay's motion for summary judgment, and (5) in setting out a schedule for discovery *188 that allowed the Appellees to conduct discovery while Kilhullen could not.
¶ 2. Finding no error, we affirm.
FACTS
¶ 3. On June 20, 2000, Thomas, a tractor-trailer operator, had just picked up a load at International Paper Company's plant in Morton, Mississippi, when he proceeded south on Herring Road away from the plant. As Thomas proceeded south to a nearby railroad crossing, over the railroad tracks, he was hit by a KC Southern train operated by Lay, an engineer. Thomas died from his injuries.
¶ 4. Lay stated that he blew the train's whistle repeatedly and put the train "in emergency" in an attempt to avoid the accident. Only one non-party eyewitness, Classie Ward, is known to exist. Ward stated in an affidavit that she observed Thomas moving very slowly over the railroad tracks. In Ward's opinion, Thomas should have been able to see the train and should have been able to avoid the accident by not passing over the railroad tracks in question.
¶ 5. On December 4, 2001, Kilhullen filed suit against the Appellees, alleging that they allowed the line of sight at the crossing to become obstructed.[1] Discovery was conducted by all parties, and several continuances were ordered. On October 22, 2004, the Appellees filed a motion for summary judgment, alleging that Kilhullen had failed to raise a genuine issue of material fact. Shortly thereafter, Kilhullen noticed the depositions of seventeen different individuals. Pursuant to the notice, Kilhullen filed a motion to hold the motion for summary judgment in abeyance due to the outstanding depositions. On the day before the scheduled summary judgment hearing, Kilhullen produced affidavits from Shelton and Halfacre in opposition to the motion for summary judgment.
¶ 6. On November 19, 2004, Kilhullen filed a motion to compel discovery from the Appellees. The Appellees filed a motion to strike the motion to compel on December 7, 2004, arguing that Kilhullen had not made a good faith effort to resolve the discovery issues before filing the motion to compel. The same day, the Appellees filed a motion to quash Kilhullen's attempt to take the depositions of the seventeen noticed witnesses. On December 15, the Appellees filed a reply in further support of their motion for summary judgment and a motion to strike Shelton's affidavit on the ground that he was not offering a lay opinion. On January 3, 2005, Kilhullen filed a response to the motion to strike the affidavit, arguing that Shelton was indeed testifying as a lay witness. On January 5, 2005, the court held a hearing but did not finally rule on the motion for summary judgment.
¶ 7. On January 25, 2005, the court put a moratorium on any further discovery in the case, with the exception that the Appellees could depose Halfacre and Shelton, whose identities had been disclosed only in response to the motion for summary judgment. The court also held the motion for summary judgment in abeyance pending a hearing on whether Shelton and Halfacre's affidavits were admissible. Despite the court's moratorium, on August 19, 2005, Kilhullen's attorney informed the Appellees that Kilhullen had another witness, Alexander, an accident reconstructionist whose opinion would be offered to bolster *189 Halfacre's findings. An affidavit from Alexander was filed on April 20, 2006.
¶ 8. After a hearing in June 2006, the trial court rendered a final opinion disposing of both the discovery issues and the motion for summary judgment, which the court found were "inextricably joined or intertwined." The court found that Shelton's and Halfacre's affidavits were inadmissible because neither was qualified to render an opinion under Daubert v. Merrell Dow Pharmaceuticals, 509 U.S. 579, 113 S.Ct. 2786, 125 L.Ed.2d 469 (1993). The court also found that Alexander's affidavit was inadmissible. Accordingly, the court found that there was no genuine issue of material fact and granted summary judgment on behalf of the Appellees. In its opinion, the court erroneously stated that Lay, the engineer who drove the train, was the only eyewitness to the accident. In reality, the accident was also witnessed by Ward, who was near enough to the railroad crossing to observe what happened.
¶ 9. Additional facts, as necessary, will be related during our analysis and discussion of the issues.
ANALYSIS AND DISCUSSION OF THE ISSUES
1. Admissibility of Shelton's Affidavit
¶ 10. Kilhullen argues that Shelton's affidavit was admissible as the opinion of a lay witness. Rule 701 of the Mississippi Rules of Evidence governs the admissibility of lay witness testimony:
If the witness is not testifying as an expert the witness's testimony in the form of opinions or inferences is limited to those opinions or inferences which are (a) rationally based on the perception of the witness, (b) helpful to the clear understanding of the testimony or the determination of a fact in issue, and (c) not based on scientific, technical, or other specialized knowledge within the scope of Rule 702.
(Emphasis added).
¶ 11. Shelton's opinion was not admissible as lay testimony because it was based on "scientific, technical, or other specialized knowledge." Essentially, Shelton's opinion was that of an expert, except that he was not qualified as such. To illustrate, we quote at length from Shelton's affidavit:
My name is Jimmy Shelton. I was reared and attended school in Leake County, Mississippi. I am employed as a paralegal and investigator with the Gilmer Law Firm and have been so employed since April, 2002.
* * * * * *
I have visited the site of the accident on two occasions. I have observed three trains traveling over the subject grade crossing. I positioned myself fourteen feet from the railroad track headed south on Herring Road. The line of visibility to the east along the railroad track at which time one could first possibly visualize the oncoming train is approximately three hundred seventy-five feet from the crossing. I observed numerous vehicles such as compact and full size automobiles, pick-up trucks, school buses and other vehicles cross the tracks after coming to a complete stop. Said vehicles required a minimum of six seconds and a maximum of eight seconds to cross the tracks operating under usual conditions.
The railroad tracks are eighteen feet in width at the crossing and the tracks run in an east and west direction. The railroad guard device which lowers as the train approaches is situated fourteen feet from the nearest track. Herring Road crosses the railroad track at approximately a seventy degree angle. If *190 the tractor trailer rig driven by Mr. Kilhullen stopped two feet to the north of this railroad guard device, then Mr. Kilhullen's head would have been situated approximately twelve feet north of the guard device. Given that Mr. Kilhullen's seat of his truck was five feet off the ground at the position of his truck at the crossing, his line of sight was approximately three hundred seventy-five feet to the point he could have first seen the locomotive with vegetation presently cleaned from the area. The original photographs taken immediately after the accident show vegetation at the point his line of sight would have allowed him visibility of the oncoming train. Therefore his visibility was materially shortened to a distance of less than three hundred seventy-five feet.
I observed an empty school bus come to a full stop and cross the railroad tracks which required a total of eight seconds and a second empty school bus which required seven seconds to cross the tracks. The Kilhullen tractor trailer rig exceeded fifty feet long loaded with lumber and would require in excess of eight seconds such as the school bus to completely cross the subject railroad tracks. Considering that the admitted speed of the train was fifty miles per hour which constitutes seventy three and one third feet per second and considering the point that Mr. Kilhullen could first see the front of the locomotive of the train, he would have had approximately five seconds to move the tractor trailer rig across the tracks.
Simple arithmetic calculations commonly learned by junior high and high school children allow a lay person to make the elementary calculations and draw the proper conclusions of the movement of Mr. Kilhullen's truck and the speed of the train. I am an experienced truck driver having operated tractor trailer rigs hauling farm equipment and other heavy equipment. Considering that the Kilhullen rig was fully loaded with lumber and his rig was approximately fifty feet long, the front bumper of his truck was approximately two feet from the guard device (sixteen feet from the north track), the distance from the guard device to the north side of the tracks is fourteen feet and the distance from the north side of the tracks to the south side of the tracks is eighteen feet, then Mr. Kilhullen's rig would have to move from a dead stop to a distance of eighty-six feet in order to completely clear the south side of the track. In my years of experience of operating tractor trailer rigs and heavy equipment this would require at least fourteen seconds. Therefore, considering the train was traveling at fifty miles per hour (seventy three and one third feet per second) and Kilhullen's first possible visual contact was at three hundred seventy-five feet, it would have been impossible for Kilhullen to move his truck across the tracks and clear the tracks before being struck by the train.
* * * * * *
The grade crossing is elevated approximately ten feet as compared to the railroad track running to the east. This further obscures the visibility of an oncoming locomotive and train.
(Emphasis added).
¶ 12. As can be seen from Shelton's affidavit, his opinion was based entirely on mathematical formulae and measurements. Presumably, they are the same measurements and formulae that an experienced accident reconstructionist would use to render his conclusions. Shelton, however, has no training or expertise as an accident reconstructionist. While some high school students might be able to work through *191 the formulae, they would be as unqualified as Shelton to render an expert opinion based on those formulae. A lay witness is someone who offers opinion testimony regarding something they know from first-hand knowledge, not something they concluded from applying technical formulae. Shelton clearly was not offering a lay opinion, nor was he qualified to render an expert opinion. Therefore, his affidavit was properly excluded by the court.
¶ 13. This contention of error is without merit.
2. Halfacre's Affidavit
¶ 14. Kilhullen contends that the court was in error for finding that Halfacre's opinion was inadmissible. The admissibility of an expert witness's testimony is governed by Rule 702 of the Mississippi Rules of Evidence, which states that a relevant expert who is "qualified as an expert by knowledge, skill, experience, training, or education" may testify if: "(1) the testimony is based upon sufficient facts or data, (2) the testimony is the product of reliable principles and methods, and (3) the witness has applied the principles and methods reliably to the facts of the case."
¶ 15. Questions regarding the admission of expert testimony are left to the discretion of the trial court. Giannaris v. Giannaris, 960 So.2d 462, 469(¶ 14) (Miss. 2007). We will not reverse the court's decision unless there was an abuse of discretion such that the decision was "arbitrary and clearly erroneous...." Id. (quoting Miss. Transp. Comm'n v. McLemore, 863 So.2d 31, 34(¶ 4) (Miss.2003)). According to Daubert, which the Mississippi Supreme Court adopted in McLemore, "[t]he trial court is vested with a `gatekeeping responsibility.'" McLemore, 863 So.2d at 36(¶ 11) (quoting Daubert, 509 U.S. at 589, 113 S.Ct. 2786).
¶ 16. During his deposition, after being asked about his areas of expertise, Halfacre stated:
I'm not representing myself as being proficient in any of the areas that you mentioned. I'm not an accident reconstructionist. I am not a street designer, railroad designer or any of the above. My involvement in this is limited specifically to looking at time and distance measurements and doing a calculation on what two bodies, in this case a train and truck, would travel in a given and specified length of time and comparing that time distance to the measured field of vision. That's the only two components that I amconsider myself appropriate to testify to.
(Emphasis added). Halfacre then stated unequivocally that he was not qualified to render an opinion as an accident reconstructionist. He also stated that the manual he used to determine which formulae to use was titled "Train Accident Reconstruction Manual."
¶ 17. Halfacre was not qualified to offer an expert opinion in this matter. While he was an engineer, his education was in electrical engineering and the majority of his experience was in conducting home inspections. On his résumé, Halfacre stated: "I am in private practice as a Registered Professional Engineer. I do consulting in the area of building science and light structure. As such, I inspect, evaluate, write and oversee repair/remediation of buildings and foundation systems." Nowhere did Halfacre claim any knowledge of accident reconstruction or the methods and formulae normally used therein. In order to render an expert opinion, an expert must be "qualified as an expert by knowledge, skill, experience, training, or education." Had Halfacre's opinion concerned electrical engineering or home inspections, he would likely have *192 been qualified to render his opinion. However, Halfacre's testimony rendered opinions regarding very specific details of how a particular accident occurred, including how much time Thomas had to move his truck across the subject railroad tracks given the speed of the train, the length of Thomas's truck, and the speed of Thomas's truck. Such testimony, regardless of Kilhullen's arguments to the contrary, are clearly an attempt at accident reconstruction. Halfacre had no experience or training whatsoever regarding accident reconstruction, as he admitted during his deposition. Therefore, Halfacre was not qualified to render the expert opinion in question. We cannot find that the court abused its discretion when it refused to admit Halfacre's opinion.
¶ 18. As support, Kilhullen cites numerous cases where she claims "civil" engineers like Halfacre were ruled as qualified to render an accident reconstruction opinion. Kilhullen first cites Illinois Central Railroad Co. v. Hawkins, 830 So.2d 1162 (Miss.2002). However, in Hawkins there was no issue made of whether the civil engineer in that case was qualified to render an accident reconstruction opinion; therefore, it is impossible for this Court to know whether the engineer in that case had any special knowledge or training that qualified him to render his opinion. Presumably he did, since the court allowed him to present expert testimony. Id. at 1178 (¶ 39). Hawkins is of no help to Kilhullen.
¶ 19. Kilhullen next cites Bowman v. CSX Transportation, Inc., 931 So.2d 644 (Miss.Ct.App.2006), wherein one engineer who did not have any experience with railroad grade engineering was allowed to testify, and another engineer who had experience only with teaching courses regarding railroad grades was allowed to testify. Id. at 656-57 (¶¶ 44-47). Nothing in the Bowman opinion suggests that either engineer had no training or experience whatsoever regarding accident reconstruction or trains, as is the case here. Clearly, Bowman is distinguishable from the present case.
¶ 20. Kilhullen also cites Illinois Central Gulf Railroad Co. v. Milward, 902 So.2d 575, 578(¶ 14) (Miss.2005), contending that a civil engineer was allowed to testify in that case regarding "the safety of a railroad crossing." While this is true, the engineer in that case listed his "fields of consultation in transportation" as: "highway safety, highway design, traffic engineering, accident reconstruction and human factors related to those things. He also consulted in the field of railroad crossing operation." Id. at 578(¶ 14). From the opinion, it appears as though the expert had previously testified in the relevant fields and had experience in those fields. Regardless, the engineer's qualifications were not addressed on appeal, and in the absence of any evidence that he, like Halfacre, had no training or experience whatsoever in accident reconstruction or train safety, we must conclude that he had such experience in order to be qualified as an expert. Milward is also of no help to Kilhullen.
¶ 21. Kilhullen also cites a number of cases from other jurisdictions. Such cases would not constitute binding authority on this Court, and for expediency's sake, we do not go into any of the cases in detail. Suffice it to say that a review of the cases has revealed that they are also of no help to Kilhullen. Although most of the cases involve individuals who are civil engineers, we note that it is not Halfacre's title that is the problem. If Halfacre were a civil engineer with extensive training or experience regarding accident reconstruction or train safety, he likely would have been qualified to render the opinion that he did. However, *193 Halfacre had no experience in any field relevant to his opinion. Nothing Kilhullen has presented indicates that the court abused its discretion in denying Halfacre's affidavit.
¶ 22. Additionally, some of Halfacre's answers during his deposition bring into question the accuracy of his conclusions. For example, Halfacre testified that he did not know what type of train was involved in the subject accident, nor the height of the train. Halfacre also stated that he did not know at what height Thomas was seated when he was killed. Furthermore, Halfacre testified that he did not know what sort of lights were on the train, nor where any such lights were located. Although Halfacre testified that he believed the line of sight from left to right was more important than the vertical line of sight, he admitted that there was some slope involved but "that the elevations of the track were not as relevant as ... was the line of sight ... looking toward the east...." However, even with regard to the horizontal line of sight, Halfacre admitted that he did not do any calculations that would take into account Thomas's increasing line of sight as he moved toward the railroad tracks. Rather, Halfacre stated that all of his measurements assumed that Thomas was fifty feet from the tracks.
¶ 23. Halfacre also testified that he did not take into account any braking done by the train after the engineer observed Thomas on the tracks. It is undisputed that Lay attempted to slow the train after seeing Thomas. Furthermore, Halfacre admitted that he had no idea exactly how heavy a load Thomas was carrying on his truck, the state of Thomas's brakes, nor how long it would have taken Thomas to come to a complete stop. As all of these facts-vertical line of sight, horizontal line of sight, placement of any lights, and any braking done by the train or Thomas-would be essential in understanding what line of sight Thomas had and whether Thomas could have safely avoided the train, it is unclear how Halfacre was able to formulate his conclusions without this data. These deficiencies further support the court's decision to rule Halfacre's opinion inadmissible.
¶ 24. This contention of error is also without merit.
3. Alexander's Affidavit
¶ 25. Alexander's affidavit was offered to prove that Halfacre's conclusions were correct. Essentially, Alexander reevaluated the relevant data and formulae and confirmed that he reached the same conclusions as Halfacre. Kilhullen offers little legal authority for her contention that Alexander's affidavit should have been considered by the court. However, she does contend that Alexander's affidavit was timely filed because the court had delayed a final hearing on the Appellees' summary judgment motion pending the outcome of the court's Daubert hearing. Thus, Kilhullen contends that, under Rule 56(c) of the Mississippi Rules of Civil Procedure, she had until the day before the final hearing to file affidavits.
¶ 26. After the first summary judgment hearing, the court delayed ruling until after it had addressed the admissibility of Kilhullen's expert witnesses. Because the Daubert issues were crucial to the court's determination of summary judgment, the second hearing addressed both the admissibility of the affidavits and whether summary judgment should be granted. Although the second hearing addressed the propriety of summary judgment, the only new information to be addressed at the hearing was the admissibility of Kilhullen's expert witnesses. Any actual facts in support of summary judgment should therefore have been submitted prior to the January *194 2005 summary judgment hearing. After the January 2005 hearing, the court put a moratorium on any further discovery. Under the circumstances, as we will discuss in more detail later, we cannot find that that decision was in error. Therefore, Alexander's affidavit was admissible only in support of Kilhullen's Daubert arguments, if at all.[2]
¶ 27. Kilhullen contends that Alexander's affidavit was admissible to show the validity of Halfacre's conclusions. We find that the court correctly ruled regarding this use of Alexander's affidavit, as Alexander did not offer any opinion as to Halfacre's qualifications or expertise. As we have discussed, Halfacre's opinion was inadmissible because he was not qualified in the field in which he was attempting to tender an opinion. Alexander's affidavit did nothing to remedy that situation.
¶ 28. This contention of error is also without merit.
4. Propriety of Summary Judgment
¶ 29. Since we have found that Kilhullen's proposed affidavits were properly rejected by the court, we also find that summary judgment was properly entered against Kilhullen. Kilhullen presented no other evidence to raise a genuine issue of material fact. Where no genuine issue exists, summary judgment is properly granted. M.R.C.P. 56(c). When reviewing the propriety of summary judgment, we conduct our review de novo. Jackson Clinic for Women, P.A. v. Henley, 965 So.2d 643, 649(¶ 11) (Miss.2007).
¶ 30. The court properly denied the proffered opinions of Shelton, Halfacre, and Alexander; and Kilhullen offered no further proof regarding whether the line of sight at the track was obstructed. Furthermore, Kilhullen has offered no proof regarding Thomas's failure to observe the train's whistle before he began his attempt to cross the tracks. It is uncontradicted that Lay, the engineer who operated the train that hit Thomas, sounded the train's horn repeatedly before he collided with Thomas. Lay testified that he began sounding the whistle at the appropriate whistle board, meaning that Thomas should have had notice of the train well before it came into his line of sight. Kilhullen has offered nothing to explain why the train's whistle was insufficient to prevent Thomas from attempting to cross the railroad tracks as the train approached.
¶ 31. Additionally, the affidavits did not establish what would have happened had Kilhullen attempted to stop rather than attempt to cross the train tracks in front of the train. As stated by Halfacre, Thomas did not have time to clear the tracks starting from a position fifty feet from the tracks. Nothing in the affidavits addressed Thomas's choice to attempt to clear the tracks in the first place. Furthermore, Ward, the only eyewitness to the accident other than Lay, stated in her affidavit that the accident was clearly Thomas's fault due to his failure to properly check for the oncoming train before attempting to cross the tracks.
¶ 32. Kilhullen argues at length that there is a genuine issue of material fact because of Ward's existence. To date, Kilhullen has presented nothing to indicate that Ward would create a genuine issue of material fact in favor of Kilhullen regarding the accident. In fact, Ward's affidavit indicates the opposite. As already discussed, she stated unequivocally that the accident was the result of Thomas's failure *195 to maintain a proper lookout for the train. Kilhullen had ample time both before summary judgment and before her appeal to this Court to produce some statement from Ward contradicting her clear statements in her affidavit, but Kilhullen has not done so. Without further proof that Ward could present a genuine issue of material fact in favor of Kilhullen, her mere existence is insufficient to prevent the entry of summary judgment.
¶ 33. Kilhullen also contends that summary judgment was improper because Halfacre's opinion regarding the line of sight should have been sufficient to create a genuine issue of material fact. As we have already discussed, the court properly rejected Halfacre's opinion because he was not qualified to offer it. In response to the argument that accident reconstruction testimony was not necessary in this case, we refer to our earlier points regarding the glaring holes in Halfacre's opinion: the height of Thomas's truck, the height of the train, the additional time that Thomas would have had as a result of the train braking, the effect that Thomas's increasing line of sight would have had on his ability to stop, and how long it would have taken Thomas to come to a complete stop at his assumed rate of speed. Presumably, an expert qualified to render accident reconstruction testimony would have been able to address all of these factors. Halfacre, on the other hand, was completely unable to do so. This case cannot be disposed of by a simple calculation without taking into account the numerous other factors that had an impact on the accident. While extensive accident reconstruction testimony might not have been required to overcome summary judgment, Kilhullen still must provide testimony regarding line of sight from someone qualified to do so. As we have already found, Halfacre was not qualified to render such an opinion. Therefore, his calculations cannot serve to prevent summary judgment.
¶ 34. The court did not err in granting summary judgment to the Appellees.
5. Discovery Schedule
¶ 35. Kilhullen contends that the court erred in allowing the Appellees to conduct discovery while at same time preventing her from doing so. She specifically complains of the court's refusal to allow her to depose a number of witnesses whose depositions she sought to take in response to the Appellees' motion for summary judgment.
¶ 36. We note that the court did not allow the Appellees to conduct any discovery they wanted; rather, the court put a moratorium on all discovery, except that the Appellees were allowed to depose Kilhullen's expert witnesses whose affidavits had just been submitted. The court did not abuse its discretion in so ordering. It appears that Kilhullen had known about the existence of all of the witnesses that she sought to depose for quite some time, but she had never sought to depose any of them. Kilhullen complains especially about her inability to depose Ward, who Kilhullen contends might have been able to provide crucial information. However, it is clear that Ward's existence as an eyewitness was known to Kilhullen for many months before she sought to depose Ward. Furthermore, given Ward's candid statements in her affidavit to the effect that the accident was entirely Thomas's fault, it is doubtful that Ward's deposition would have been of any help to Kilhullen.
¶ 37. Kilhullen points to the fact that the Appellees filed motions shortly before the motion for summary judgment wherein it was stated that "the parties are in agreement that this matter is not ready for trial." We note that simply because a matter is not ready for trial does not automatically *196 mean that discovery is still ongoing. In fact, it appears from the record that the Appellees had concluded the majority of their discovery several months prior to filing the motion for summary judgment, and Kilhullen had not actively pursued discovery from the Appellees since sometime in mid-2002, more than two years prior to the filing of the Appellees' motion for summary judgment. Kilhullen cites several cases for the proposition that summary judgment cannot be granted when it is clear that discovery is ongoing in a case. However, since the Appellees appeared to have finished their discovery and since Kilhullen had not pursued discovery for over two years, discovery in this case appeared to have been completed prior to the court's entry of summary judgment. While Kilhullen suddenly wanted to conduct further discovery after the filing of the motion for summary judgment, the court did not err in forbidding her to do so. Kilhullen had had ample time to conduct discovery but had chosen not to do so. This fact distinguishes her case from those she cites. See Burkhalter & Co. v. Wissner, 602 So.2d 835, 838 (Miss.1992).
¶ 38. Under the circumstances, we do not find that the court abused its discretion in putting a moratorium on discovery. As stated by the Mississippi Supreme Court: "Our trial judges are afforded considerable discretion in managing the pre-trial discovery process in their courts, including the entry of scheduling orders setting out various deadlines to assure orderly pre-trial preparation resulting in timely disposition of the cases." City of Jackson v. Presley, 942 So.2d 777, 781(¶ 7) (Miss. 2006) (quoting Bowie v. Montfort Jones Mem'l. Hosp., 861 So.2d 1037, 1042 (¶ 14) (Miss.2003)).
¶ 39. This contention of error is also without merit.
¶ 40. THE JUDGMENT OF THE CIRCUIT COURT OF SCOTT COUNTY IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE APPELLANT.
KING, C.J., LEE AND MYERS, P.JJ., CHANDLER, GRIFFIS, ISHEE, ROBERTS AND CARLTON, JJ., CONCUR. BARNES, J., NOT PARTICIPATING.
NOTES
[1] The complaint was also filed against International Paper and Illinois Central Gulf Railroad Company. Both of those parties have been released from the suit and are not parties to this appeal. The complaint also proposed several theories of negligence; however, line of sight is the only theory alleged on appeal.
[2] We also note that Alexander was not formally designated as an expert prior to Kilhullen's filing of his affidavit. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603753/ | 882 F.Supp. 433 (1995)
The F.B. LEOPOLD CO., INC., Plaintiff,
v.
ROBERTS FILTER MANUFACTURING COMPANY, INC., Defendant.
Civ. A. No. 92-2427.
United States District Court, W.D. Pennsylvania.
March 10, 1995.
*434 *435 Webb, Burden, Ziesenheim & Webb, P.C., John W. McIlvaine, III, Pietragallo, Bosick & Gordon, John E. Hall, Pittsburgh, PA, for plaintiff.
*436 Feldstein, Grinberg, Stein & McKee, Stanley M. Stein, Dickie, McCamey & Chilcote, P.C., Leland P. Schermer, Pittsburgh, PA, for defendant.
OPINION AND ORDER OF COURT
AMBROSE, District Judge.
Pending before the Court are two Motions for Summary Judgment filed by Plaintiff, The F.B. Leopold Co. [hereinafter Leopold], pursuant to Fed.R.Civ.P. 56. Leopold initiated this patent infringement action on December 18, 1992. Defendant, Roberts Filter Manufacturing Company [hereinafter Roberts Filter], has filed a counterclaim for declaratory judgment of invalidity and non-infringement of Leopold's patents, and has also asserted claims under § 43(a) of the Lanham Act, as well as claims which seek relief for unfair competition, anti-trust, and defamation. The instant Motions for Summary Judgment concern Roberts Filter's counterclaims for anti-trust and defamation. Oral argument on these motions was held on February 17, 1995. For the reasons set forth below, Leopold's Motion for Summary Judgment as to Defendant's Defamation Counterclaim will be granted in part and denied in part. Leopold's Motion for Summary Judgment as to Defendant's Antitrust Counterclaim will be granted.
Summary judgment may only be granted if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). Rule 56 mandates the entry of summary judgment, after adequate time for discovery and upon motion, against the party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). In considering a motion for summary judgment, this Court must examine the facts in a light most favorable to the party opposing the motion. International Raw Materials, Ltd. v. Stauffer Chemical Co., 898 F.2d 946, 949 (3d Cir. 1990). The burden is on the moving party to demonstrate that the evidence creates no genuine issue of material fact. Chipollini v. Spencer Gifts, Inc., 814 F.2d 893, 896 (3d Cir.1987). The dispute is genuine if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). A fact is material when it might affect the outcome of the suit under the governing law. Id. Where the non-moving party will bear the burden of proof at trial, the party moving for summary judgment may meet its burden by showing that the evidentiary materials of record, if reduced to admissible evidence, would be insufficient to carry the non-movant's burden of proof at trial. Celotex, 477 U.S. at 322, 106 S.Ct. at 2552.
Because the facts have been set forth (extensively) in the parties' briefs[1], and this action has been the subject of various motions previously addressed by this Court, we need only briefly summarize the nature of this action here. The claims which are the subject of this suit primarily are the result of the efforts of Leopold and Roberts Filter to secure a bid on a public contract to supply filtration equipment for the City of Reading's Maiden Creek Filter Plant Filter Rehabilitation Project. Leopold and Roberts Filter are competitors in the water filtration business.
In December, 1989, the City of Reading began preparing a rehabilitation project for its Maiden Creek Filtration Plant. The City of Reading worked on this project in conjunction with engineers from Entech, Inc. and BCM. Leopold sales representatives corresponded with the engineers concerning the *437 use of the Leopold IMS plate and media for the project. (See Volume I of Roberts Filter's Exhibits, Exhibit 31) During this time, Leopold was pursuing a patent for its "Cap for Underdrains in Gravity Filters." (See Volume I of Roberts Filter's Exhibits, Exhibits 34, 35) The patent was eventually issued on September 22, 1992, and is referred to by the parties as the "427 patent."[2] (See Volume I of Roberts Filter's Exhibits, Exhibit 39) The patented product essentially consists of a Leopold underdrain and a porous plate (the "IMS Cap").[3] (Leopold's Exhibits (Antitrust), Exhibit 5; see also Leopold's Exhibits (Defamation), Exhibit 10)
Leopold was designated as the basis of the design for the Maiden Creek Filter Rehabilitation Project. (Leopold's Exhibits (Antitrust), Exhibit 8, p. 1) Roberts Filter also sought to bid on the project. (See Volume I of Roberts Filter's Exhibits, Exhibits 32, 38, 56) Roberts was eventually added as an acceptable alternative supplier for the project. (Volume I of Roberts Filter's Exhibits, Exhibits 44, 62)
A series of meetings and an exchange of correspondence then ensued concerning Leopold's assertion that the design proposed by Roberts Filter for the project would infringe on Leopold's 427 patent. (See e.g. Volume I of Roberts Filter's Exhibits, Exhibits 45, 49, 53, 55, 58, 60, 63, 64) The bidding for the project was initially set for November 18, 1992, but was postponed so that additional tests could be conducted on the proposed designs. (Volume I of Roberts Filter's Exhibits, Exhibit 62, p. 2) On December 18, 1992, Leopold filed the instant action alleging, inter alia, that a demonstration conducted by Roberts Filter at the Godwin Pump facility in New Jersey infringed on Leopold's patent. At the December 29, 1992, pre-counsel meeting of the Reading City Counsel, it was decided that all bids on the filtration contracts would be rejected and the bidding was again postponed. (Volume I of Roberts Filter's Exhibits, Exhibit 62, p. 5; see also Leopold's Exhibits (Antitrust), Exhibit 17) Ultimately, Leopold was unable to bid on the City of Reading project and Roberts Filter was awarded the contract. (Volume I of Roberts Filter's Exhibits, Exhibit 68)
We will first address Leopold's Motion for Summary Judgment with respect to Defendant's counterclaim for defamation. Leopold contends that summary judgment should be granted in its favor for a number of reasons. Specifically, Leopold argues that it was either absolutely or conditionally privileged to publish the alleged defamatory statements and asserts various theories in support of these privileges. Leopold also claims that the statements that are the subject of this action are not defamatory and that Roberts Filter has failed to come forward with sufficient evidence to establish damage to the reputation or, to the extent that Roberts Filter has attempted to assert a claim for commercial disparagement, no pecuniary loss has been shown.
The following has been identified by Roberts Filter as the subject of the defamation claim:
(a) That on or about October 21, 1992, Leopold, by and though its President and CEO, Marvin A. Brown, sent a letter to the Purchasing Agent of the City of Reading in which letter Brown accused Roberts of knowingly infringing the Leopold patent; copies of that letter were sent to various other persons; Leopold supplemented that letter with verbal communications to agents of the City of Reading, including Russell Smith, Reading's project engineer (Paras. 1-4, Seconded Amended Count V);
(b) That in early October, 1992, employees of Leopold met with Russell Smith and, by means of oral communication and through the exhibition of a device which falsely purported to be a sample of the Roberts' product, disparaged Roberts' product, suggesting that it was of flimsy construction *438 and would not perform the functions that it was designed to perform. (Id., Paras. 8 and 9) (Bareis, pp. 29-44, Ex. 88; Smith, pp. 144-145, Ex. 89);
(c) That on or about February 17, 1993, James Lefever, a sales representative of Leopold, with Leopold's full knowledge, approval and cooperation, appeared before a meeting of Reading City Council and further accused Roberts of knowingly infringing Leopold (sic) patent and engaging in a conspiracy with city engineers to provide a product with which so infringed (Id., Para. 10) (Lefever, pp. 65070, Ex. 74, Ex. 75; ex. 97, pp. 6-7); and
(d) That on November 12, 1992, Leopold's Regional Sales Manager, Nelson Bareis, in a letter directed to Hazen & Sawyer, engineers on the Detroit project, accused Roberts of designing a product which would infringe the Leopold patent and requested that Roberts be eliminated as an acceptable supplier (Id., Para 12) (Ex. 55).
Roberts Filter's Brief in Opposition to Summary Judgment, pp. 100-101.
In Pennsylvania, actions for defamation are governed by 42 Pa.Cons.Stat.Ann. § 8343 which provides:
(a) Burden of Plaintiff. In an action for defamation, the plaintiff has the burden of proving, when the issue is properly raised:
(1) The defamatory character of the communication.
(2) Its publication by the defendant.
(3) Its application to the plaintiff.
(4) The understanding by the recipient of its defamatory meaning.
(5) The understanding by the recipient of it as intended to be applied to the plaintiff.
(6) Special harm resulting to the plaintiff from its publication.
(7) Abuse of a conditionally privileged occasion.
(b) Burden of defendant.
(1) The truth of the defamatory communication.
(2) The privileged character of the occasion on which it was published.
(3) The character of the subject matter of defamatory comment as of public concern.
42 Pa.Cons.Stat.Ann. § 8343 (1982).
Additionally, we would note that although Count V of Roberts Filter's Second Amended Complaint is entitled "Defamation," the allegations have also been construed by the parties as commercial disparagement. In order to maintain an action for commercial disparagement, the plaintiff must prove that the disparaging statement of fact is untrue or that the disparaging statement of opinion is incorrect; that no privilege attaches to the statement; and that the plaintiff suffered a direct pecuniary loss as the result of the disparagement. U.S. Healthcare Inc. v. Blue Cross of Greater Philadelphia, 898 F.2d 914, 924 (3d Cir.1990). "A commercially disparaging statement ... is one which is intended by its publisher to be understood or which is reasonably understood to cast doubt upon the existence or extent of another's property in land, chattels or intangible things, or upon their quality, ... if the matter is so understood by its recipient." Id. (internal quotations omitted)
Leopold first argues that it had an absolute privilege to publish the alleged defamatory statements because the statements "related to contemplated or actual judicial proceedings." (Leopold's Brief in Support of Summary Judgment (Defamation), p. 9) See Restatement (Second) of Torts § 587 (1977). This section of the Restatement provides, in relevant part, that:
A party to a private litigation ... is absolutely privileged to publish defamatory matter concerning another in communications preliminary to a proposed judicial proceeding, or in the institution of or during the course and as a part of, a judicial proceeding in which he participates, if the matter has some relation to the proceeding.
Restatement (Second) of Torts § 587 (1977). See also Restatement (Second) of Torts § 635 (1977) [applying § 587 to claims for commercial disparagement].
Pennsylvania has recognized an absolute privilege for communications in judicial proceedings. *439 See Post v. Mendel, 510 Pa. 213, 507 A.2d 351 (1986), Pawlowski v. Smorto, 403 Pa.Super. 71, 588 A.2d 36 (1991). Although the alleged defamatory communications at issue in this action were not made during the course of a judicial proceeding, they may be "communications preliminary to a proposed judicial proceeding." Restatement (Second) of Torts, supra. Leopold is therefore required, in order to establish the applicability of the privilege, to demonstrate that "the protected communication[s] ... [were] pertinent and material and ... [were] issued in the regular course of preparing for contemplated proceedings." Post, 507 A.2d at 356. See 42 Pa.Cons.Stat.Ann. § 8343(b)(2).
Leopold cites Pinto v. Internationale Set, Inc., 650 F.Supp. 306 (D.Minn.1986) and Walker v. Majors, 496 So.2d 726 (Ala.1986), in support of its position that the communications were absolutely privileged. In Pinto, the plaintiffs were former employees of the defendant who left their positions with the defendant company and began working for the defendant company's competitor. After the plaintiffs left the defendant company's employ, the defendant's counsel sent a letter dated January 2, 1986, to the plaintiffs' new employer which warned the plaintiffs' new employer that litigation would be instituted and accused the plaintiffs of unfair competition and conspiracy, fraud, misrepresentation, and other misdeeds. Pinto 650 F.Supp. at 307-308. Plaintiffs then filed suit against their former employer alleging, inter alia, defamation based on the January 2, 1986, letter. The court found that the communication was absolutely privileged because the letter "was written in anticipation of the March 1986 litigation, it concern[ed] the claims made in that litigation, it [sought] to dissuade plaintiff from further engaging in the alleged activities which gave rise to the litigation, and it was directed to plaintiffs and their new employer on defendant's behalf." Id. at 308-309.
In Walker v. Majors, 496 So.2d 726 (Ala. 1986), the plaintiff, a land owner, filed suit alleging defamation against a real estate agent after the real estate agent sent letters, and returned the earnest money, to two prospective purchasers of the plaintiff's property. The letters included a paragraph which stated that the real estate agent was going to file suit against the land owners for breach of contract, and to recover damages incurred as a result of the land owners' fraudulent conduct. The court found that the letters were absolutely privileged because they were relevant to the contemplated judicial proceeding of the real estate agent.
Roberts Filter cites Post v. Mendel, supra, and argues that "the defamatory communications were not made in the regular course of judicial proceedings and were not pertinent and material to the redress or relief sought." (Brief of Roberts Filter, p. 102-103) In Post, the plaintiff and defendant were engaged as opposing counsel in litigation. During the trial, defendant Mendel wrote a letter to plaintiff Post concerning Mendel's irritation at Post's conduct during trial. The letter was copied to the judge hearing the ongoing case, the Disciplinary Board of the Supreme Court, and Mendel's client in the ongoing case. The trial court found the letter absolutely privileged because it was disclosed in connection with a judicial proceeding. The Pennsylvania Supreme Court reversed, holding that the communication was not protected by an absolute privilege.
In reaching its decision, the Court emphasized the importance of applying the privilege in accordance with its underlying policy and stated, "we do not believe issuance of the letter was within the sphere of activities which judicial immunity was designed to protect." Post, at 355, 356. The Court reasoned that the challenged communication must bear a certain relationship to the proceedings in order to qualify as privileged. Id. The Court then found that the letter contained matter which was not relevant to the judicial proceedings and that it was published to persons who had no direct interest in the proceedings. Id. at 357. Thus, unlike Pinto and Walker, the letter in Post did not "relate to the adjudication of the claims at issue in [the] proceedings." Pawlowski, 588 A.2d at 41.
In the case at bar, we are unable to find that any of the communications at issue were relevant to the judicial proceedings initiated *440 by Leopold on December 18, 1992. Under Post, imminent or ongoing litigation between the parties is insufficient to bring every matter that transpires between the parties within an absolute privilege. Furthermore, Leopold has not explained how any of the communications related to the adjudication of the claims at issue in the proceedings. Moreover, it is not clear that all of the various parties to whom the communications were made had a direct interest in the proceedings. Post, 507 A.2d at 357, Pawlowski, 588 A.2d at 42. We find that the alleged defamatory statements are not protected by the absolute privilege for judicial proceedings.
We next address Leopold's argument that it is entitled to summary judgment because it is protected, pursuant to Restatement (Second) of Torts § 592A,[4] by an absolute privilege to publish defamatory matter that it was required, by law, to publish. (See Leopold's Memorandum in Support of Summary Judgment (Defamation), p. 11). Leopold argues that the patent laws require a patent holder to notify a potential infringer before the patent holder may recover damages for infringement. Apparently, Leopold relies upon 35 U.S.C. § 287. This section provides, in relevant part:
§ 287. Limitation on damages and other remedies; marking and notice
(a) Patentees, and persons making or selling any patented article for or under them, may give notice to the public that the same is patented, either by fixing thereon the word "patent" or the abbreviation "pat.", together with the number of the patent, or when from the character of the article, this can not be done, by fixing to it, or to the package wherein one or more of them is contained, a label containing a like notice. In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice. Filing of an action for infringement shall constitute such notice.
35 U.S.C.A. § 287(a) (West Supp.1994) (emphasis added).
Leopold has not presented any authority which would indicate that this section invokes an absolute privilege. We need not decide that issue, however, because Leopold has not demonstrated that it was required under section 287 to publish the alleged defamatory communications. Specifically, Leopold has not argued that its product was not properly marked. Under section 287, "[t]wo kinds of notice are specified one to the public by visible mark, another by actual advice to the infringer. The second becomes necessary only when the first has not been given." Ceeco Mach. Mfg. Ltd. v. Intercole, Inc., 817 F.Supp. 979, 982 (D.Mass.1992). Since there is no allegation that Leopold's product was not properly marked, there is no apparent need to invoke section 287(a). We therefore find Leopold's argument to be without merit.
Leopold also argues that it was conditionally privileged to make the communications at issue because (1) Roberts Filter and Leopold were rival claimants and, (2) the communications directly related to matters of public concern.[5] Roberts Filter argues that with respect to these conditional privileges, there are genuine issues of material fact concerning Leopold's alleged bad faith which preclude the entry of summary judgment on these conditional privileges.
We will first address the rival claimant privilege. Under this theory, Leopold invokes *441 the Restatement (Second) of Torts § 647. This section provides:
A rival claimant is conditionally privileged to disparage another's property in land, chattels or intangible things by an assertion of an inconsistent legally protected interest in himself.
Comment (d): Belief in validity of claim.
... Under the rule stated in this Section a rival claimant is privileged to assert the inconsistent interest unless a trier of fact is persuaded that he did not believe in the possible validity of his claim. It is not necessary that the person asserting the claim should believe in its certain or even probable validity. It is enough if he believes in good faith that there is a substantial chance of its being sustained.
Restatement of Torts (Second) § 647 (1977).
It is the burden of Leopold to establish that the rival claimant privilege attaches to each of the communications. 42 Pa.Cons.Stat.Ann. § 8343(b)(2). A patent holder may assert this privilege when the patent holder has claimed in good faith that a party has infringed its patent. See e.g. Kemart Corp. v. Printing Arts Research Lab., Inc., 269 F.2d 375, 391 (9th Cir.1959), Oil Conservation Eng'g Co. v. Brooks Eng'g Co., 52 F.2d 783, 785-787 (6th Cir.1931). We find that Leopold has met its burden in establishing that the rival claimant privilege applies to the communications which concern Roberts Filter's alleged infringement of the Leopold patent. (See Robert Filter's Brief, pp. 100-101, (a), (c) & (d))
We must next address whether Roberts Filter has met its burden in setting forth facts of record from which a reasonable jury may find that Leopold abused this conditional privilege. See 42 Pa.Cons.Stat.Ann. § 8343(a)(7). We are not concerned with assessing whether the publishers of the alleged defamatory material were correct in their assertion that Roberts Filter infringed the Leopold patent; rather, we focus on whether the publishers had reasonable cause to believe that the assertion of patent infringement was true. Kemart at 391 fn 10, and 393. See also Forman v. Cheltenham Nat. Bank, 348 Pa.Super. 559, 502 A.2d 686, 688 (1985) (publisher must reasonably believe in the validity of the claim), Fischer v. Bar Harbor Banking & Trust Co., 673 F.Supp. 622 (D.Me.1987), aff'd, 857 F.2d 4 (1st Cir. 1988) ("Plaintiff has the burden of showing that the [defendant] did not have a good faith belief in the `possible validity of [its] claim' ... but rather that it acted in knowing or reckless disregard of the truth." Id., 673 F.Supp. at 626.). But see, Forman, 502 A.2d at 689 (Beck, J., concurring) (The question is not whether the person asserting the claim should believe in its certain or even probable validity, but rather whether the claimant believes in good faith, both when the rival property claim was initially asserted and when the claimant thereafter continued to maintain the claim, that there was a substantial chance of having the claim upheld.)
Roberts Filter argues in its brief that it has set forth sufficient facts of record from which a reasonable jury could find that Leopold acted in bad faith. In particular, Roberts Filter argues that "a jury could easily conclude that Leopold, even though it may have viewed its patent as valid ... knew very well that Roberts had not infringed it." (Roberts Filter's Brief at 103) (emphasis in original) Roberts Filter further asserts that "[i]f Leopold knew, as the fair inference to be drawn from the evidence suggests it did, that [Roberts Filter] did not infringe its patent, then its defamatory or disparaging communications accusing Roberts of infringing cannot have been made in good faith." (Roberts Filter's Brief at 103)
We begin by analyzing each of the alleged defamatory communications. The first alleged defamatory communication is an October 21, 1992, letter written by Leopold President and CEO Marvin Brown to Maria Ballas (apparently a Reading city official) which states:
I understand that you intend to publish an addendum for the subject project that will allow Roberts Filter to provide an alternative to the Leopold Universal Underdrain with IMS Cap; a Clay Underdrain Block with an IMS Cap. We believe that the Roberts design will infringe on our patent. Unfortunately, any legal action must first be levied against the end-user of the infringed *442 product, not the manufacturer; thus the need to notify you of the potential infringement.
Volume I of Robert Filter's Exhibits, Exhibit 45.
Roberts Filter argues that evidence has been produced concerning Mr. Brown's knowledge of the validity of his claim which precludes the entry of summary judgment. Specifically, Roberts Filter argued at oral argument that Brown knew that Leopold attorney John McIlvaine had filed a continuation application on the 427 patent which was designed to cover the proposed design of Roberts Filter for a project that both Roberts Filter and Leopold were bidding on in Detroit. (See also Roberts Filter's Brief at 16) Roberts Filter also argues in its Supplemental Memorandum that with respect to Roberts Filter's proposed design for the City of Reading project, there is evidence which indicates that Leopold did not even know what the Roberts Filter design was when Marvin Brown sent the letter to the City of Reading. (See Roberts Filter's Supplemental Memorandum at 3-4) Roberts Filter concludes that a reasonable jury could find that Brown knew that Roberts Filter's proposed design did not infringe on the 427 patent as alleged.
At his deposition, Marvin Brown stated the following:
Q: Now, the document says, "We believe the Roberts design will infringe on our patent." Why did you believe that on October 21, 1992?
A: Because its very difficult to imagine any design where you affix a porous plate to the top of the lateral underdrain without infringing.
Deposition of Marvin Brown June 28, 1993, p. 150, Exhibit G to Exhibits in Support of Submission of Defendant on Disqualification Issues.
Although this statement by Brown may indicate a reasonable belief in the validity of the claim, there is also evidence of record that indicates that Brown may have known that the continuation application filed by Leopold was filed to cover Roberts Filter's design. For example, a letter dated February 5, 1993, to Attorney John McIlvaine from Marvin Brown states:
2) Application 07/947/145 dated 9/18/92. As I recall, this is an expansion of patent 5,149,427 on porous plastic IMS to cover Roberts' recent design plus.
Exhibits in Support of Submission of Defendant on Disqualification Issues, Exhibit 262 E.
Additionally, the record contains a letter from Attorney John McIlvaine to Gene Bergmann, Vice President of Engineering at Leopold, wherein McIlvaine advises Bergmann on September 18, 1992, that the continuation application had been filed with the United States Patent and Trademark Office. The letter indicates that a copy of this letter was sent to Marvin Brown. (Volume I of Roberts Filter's Exhibits, Exhibit 41) Brown may therefore have been aware of the continuation application[6] as early as September 18, 1992.
Additionally, Roberts Filter directs this Court to Marvin Brown's declaration in the Petition to Make Special Because of Actual Infringement that "the device which I allege infringes this invention was first discovered to exist on November 5, 1992." (Volume II of Roberts Filter's Exhibits, Exhibit 115, p. 72) This creates a genuine issue of material fact as to whether Brown in good faith believed on October 21, 1992, that "Roberts design will infringe on our patent." (Volume I of Roberts Filter's Exhibits, Exhibit 45)
Based on the evidence of record we find that there are genuine issues of material fact concerning whether Brown had reasonable *443 cause to believe that the assertion of patent infringement was true. Summary judgment cannot be granted as to this claim.
We next turn to the February 17, 1993, meeting of the Reading City Council. At this meeting, Leopold sales representative James Lefever appeared on behalf of Leopold and made a presentation. During this presentation, which has been transcribed, Lefever stated:
Roberts also said they could meet all the specs and also supply an IMS cap even though they knew they would be infringing upon several enforceable Leopold patents, which we are now in litigation with Roberts on.
Volume I of Roberts Filter's Exhibits, Exhibit 97.
While Roberts Filter has alleged bad faith on the part of Leopold, it bases its claims of bad faith mainly on the actions of Attorney John McIlvaine who prosecuted the patents at issue for Leopold. Roberts Filter has directed this Court to no evidence which would tend to demonstrate that James Lefever, the publisher of the alleged defamatory material, did not have a "reasonable belief in the validity of [his] claim." Forman, 502 A.2d at 688. Absent such evidence, we find that Roberts Filter has failed to come forward with sufficient evidence from which a reasonable jury may find that the rival claimant privilege was abused with respect to this communication.
Similarly, Roberts Filter claims that a November 12, 1992, letter from Nelson Bareis, Leopold's Regional Sales Manager, was defamatory. The letter states in relevant part:
We believe that Roberts' design will infringe on our patent. Therefore, to prevent potential patent infringement litigation, we recommend that Roberts be removed as an acceptable supplier.
Volume I of Roberts Filter's Exhibits, Exhibit 55, p. 2.
Roberts Filter has not argued that Nelson Bareis made these statements in bad faith. We therefore find that Roberts Filter has failed to meet its burden of producing sufficient evidence from which a reasonable jury may find that Leopold abused its privilege with respect to this communication. Additionally, we find that Roberts Filter has failed to come forward with sufficient evidence to demonstrate that the privilege was abused due to overpublication with respect to either the Bareis or Lefever communications. See generally, Elia v. Erie Ins. Exch., 430 Pa.Super. 384, 634 A.2d 657, 661 (1993) ("Abuse of a conditional privilege is indicated when the publication ... is made to a person not reasonably believed to be necessary for the accomplishment of the purpose of the privilege ...").
Roberts Filter's final claim of defamation involves a meeting in early October, 1992, during which employees of Leopold allegedly:
... by means of oral communication and through the exhibition of a device which falsely purported to be a sample of the Roberts' product, disparaged Roberts' product, suggesting that it was of flimsy construction and would not perform the functions that it was designed to perform. (Id., Paras. 8 and 9) (Bareis, pp. 29-44, Ex. 88; Smith, pp. 144-145, Ex. 89);
Roberts Filter's Brief, p. 100.
We have already determined that the rival claimant privilege does not apply to this communication. We nevertheless must grant summary judgment as to this claim because we find the claim insufficient as either a claim for defamation or a claim for commercial disparagement as a matter of law.
We would initially note that this claim does not appear to be a claim for defamation because a defamatory statement is one which "tends ... to harm the reputation of [Roberts Filter] as to lower [it] in the estimation of the community or to deter third persons from associating or dealing with [it]." U.S. Healthcare, 898 F.2d at 923. Rather, the claim appears to be that of commercial disparagement. The Third Circuit has stated:
The distinction between actions for defamation and disparagement turns on the harm towards which each is directed. An action for commercial disparagement is meant to compensate a vendor for pecuniary loss suffered because statements attacking the quality of his goods have reduced *444 their marketability, while defamation is meant [to] protect an entity's interest in character and reputation.
Id. at 924.
In determining whether a statement is defamatory or commercially disparaging, the Third Circuit has utilized the following test:
[W]here the publication on its face is directed against the goods or product of a corporate vendor or manufacturer, it will not be held libelous per se as to the corporation, unless by fair construction and without the aid of extrinsic evidence it imputes to the corporation fraud, deceit, dishonesty, or reprehensible conduct in its business in relation to said goods or product.
Id., citing National Ref. Co. v. Benzo Gas Motor Fuel Co., 20 F.2d 763, 771 (8th Cir. 1927).
When the allegations of Roberts Filter concerning the October, 1992, meeting between Leopold employees and Russell Smith are analyzed under this test, they clearly do not impute to Roberts Filter "fraud, deceit, dishonesty, or reprehensible conduct in its business." Id. The allegations are actionable (if at all) under a cause of action for commercial disparagement.
With respect to the specific communication, Roberts Filter cites to the depositions of Nelson Bareis and Russell Smith to demonstrate publication of the defamatory matter. A review of these depositions does not reveal the identity of the person who communicated the alleged disparaging matter, nor do the depositions reveal what disparaging words were spoken. The most specific description of the meeting was given by Russell Smith during his deposition where he stated:
Just as a comment, originally in one of the meetings that I had with Jim Lefever, Nelson Bareis was also present. They brought in a Leopold clay tile. Leopold had manufactured the same type of tile as Roberts prior to switching to the universal underdrain. Attached to that clay tile with steel banding straps was a piece of plate. The porous plate was approximately 5/8th of an inch thick and the steel bands were approximately 18 inches a part [sic]. When they brought this unit into the office, they are saying this is what Roberts is proposing to furnish to you. Look how flimsy this porous plate is and they grabbed the center of the porous plate and lifted it and there was a lot of flexibility in that porous plate.
Deposition of Russell Smith February 9, 1993, p. 144, Volume I of Roberts Filter's Exhibits, Exhibit 89
Roberts Filter has not directed this Court to any evidence that would indicate that either of the two Leopold representatives at the meeting stated that the plate was flimsy or that either of them made any other disparaging comments about the product. We find that Roberts Filter has failed to establish the existence of a disparaging communication with respect to this claim. Summary judgment with respect to this claim will therefore be granted.[7]
Based on our disposition of Leopold's Motion for Summary Judgment (Defamation), we need not address Leopold's remaining arguments.
We next address Leopold's Motion for Summary Judgment on Roberts Filter's antitrust claims. Roberts Filter summarily alleges in its five paragraph anti-trust counterclaim that "[t]he conduct of Plaintiff ... violates the provisions of the Sherman Antitrust Act, 15 U.S.C. §§ 1 and 2, and otherwise constitute [sic] unfair and predatory competition." (Roberts Filter's Second Amended Answer and Counterclaim, ¶ 27) In its Brief in Opposition to Summary Judgment, Roberts Filter claims that it has stated viable anti-trust claims for monopolization and illegal tying under section 1 of the Sherman Act, attempted monopolization under section 2 of the Sherman Act, and a Walker *445 Process[8] claim for fraudulent procurement and bad faith enforcement of a patent.
Leopold sets forth numerous reasons why summary judgment should be granted as to all anti-trust claims averred by Roberts Filter. For example, Leopold argues that with respect to the section 1 claim, Roberts Filter has not shown concerted activity, nor has it established all the elements necessary to establish an illegal tying arrangement. Leopold also argues that with respect to the section 2 claims, Roberts Filter cannot demonstrate a monopoly, a specific intent to achieve a monopoly or predatory and anti-competitive conduct. Moreover, Leopold argues, Roberts Filter has not come forward with sufficient evidence to demonstrate that Leopold has sufficient market power to come dangerously close to achieving a monopoly, and has failed to define a relevant product market. Finally, Leopold argues that the Walker Process claim must be dismissed because all of the prerequisites to a section 2 claim have not been met, and that sufficient evidence of fraud has not been produced.
Section 1 of the Sherman Act provides, in relevant part:
Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.
15 U.S.C.A. § 1 (West Supp.1994).
To establish a claim under section 1 of the Sherman Act, a plaintiff must show (1) that the defendants contracted, combined or conspired among each other; (2) that the combination or conspiracy produced adverse, anti-competitive effects within the relevant product and geographic markets; (3) that the objects of and the conduct pursuant to the contract or conspiracy were illegal; and (4) that the plaintiff was injured as a proximate result of the conspiracy. Siegel Transfer, Inc. v. Carrier Express, Inc., 856 F.Supp. 990, 995-996 (E.D.Pa.1994). "The very essence of a section 1 claim ... is the existence of an agreement. Indeed, section 1 liability is predicated upon some form of concerted action." Alvord-Polk Inc. v. F. Schumacher & Co., 37 F.3d 996, 999 (3d Cir.1994), cert. denied, ___ U.S. ___, ___, 115 S.Ct. 1691, 131 L.Ed.2d 556 (1995). "The term `concerted action' is often used as a shorthand for any form of activity meeting the section 1 `contract, combination or conspiracy.'" Id. at 999 fn. 1.
Leopold argues that Roberts Filter has failed to demonstrate concerted action. Roberts Filter attempts to establish concerted action by stating that "Leopold acted in concert with Attorney McIlvaine, and with independent sales representatives so as to achieve the unlawful purpose of `restraining trade.'" (Roberts Filter's Brief at 26) We find that Roberts Filter has failed to establish concerted action.
In reaching this conclusion, we would initially note that the Third Circuit has recognized that concerted action has been treated by Congress more strictly than unilateral behavior because "[c]oncerted activity inherently is fraught with anticompetitive risk ... In any conspiracy, two or more entities that previously pursued their own interests separately are combining to act as one for their common benefit." Id. at 1000, citing Copperweld Corp. v. Independence Tube Corp., 467 U.S. 752, 768-69, 104 S.Ct. 2731, 2740, 81 L.Ed.2d 628 (1984) (emphasis added). Importantly, "[i]t is the joining together of formerly competitive interests which implicates the antitrust laws." Siegel Transfer, 856 F.Supp. at 999. In order to find concerted action in the case at bar, we must find that Leopold's patent attorney and its independent sales representatives "are legally capable of conspiring with each other under § 1 of the Sherman Act." Copperweld, 467 U.S. at 755, 104 S.Ct. at 2733.
The actors which allegedly conspired, according to Roberts Filter, were Leopold's independent sales representatives and the attorney who was acting on behalf of Leopold in prosecuting the 427 and 592 patents.[9]*446 While Roberts Filter sets forth very little information about the duties of the independent sales representatives, the evidence of record at least reveals that the independent sales representatives accompanied Leopold employees to meetings, appeared before the Reading City Counsel to promote the Leopold design, and wrote letters which inter alia, recommended the use of Leopold products. (Roberts Filter's Brief, pp. 14, 29-30) Both Roberts Filter and Leopold utilized the services of independent sales representatives. (See Roberts Filter's Brief, p. 13, 14)
Whether or not concerted activity existed between a corporation and its independent sales representatives was addressed by the Eighth Circuit in Pink Supply Corp. v. Hiebert, Inc., 788 F.2d 1313 (8th Cir.1986). In Hiebert, the plaintiff filed an antitrust suit alleging price-fixing and boycott conspiracy against Hiebert and four sales representatives who were employed by different companies. Id. at 1315. The independent sales representatives were responsible for assisting Hiebert in the solicitation of business and the promotion of Hiebert products, but represented other manufacturers besides Hiebert. Id. at 1316-1317. See also Pink Supply Corp. v. Hiebert, Inc., 612 F.Supp. 1334, 1336-1338 (D.Minn.1985). The trial court granted summary judgment on the section 1 claim and found that based on the facts of record, Hiebert could not have conspired with its independent sales representatives. Id. at 1340.
The Eighth Circuit affirmed the trial court's decision to grant summary judgment. Relying on, inter alia, the rationale of the Supreme Court in Copperweld, the Eighth Circuit concluded that "the sales agents were so closely intertwined in economic interest and purpose with Hiebert as to amount to a unified economic consciousness incapable of conspiring with itself." Hiebert, 788 F.2d at 1317. The court particularly noted that the "sole function [of the sales representatives] in the context of Hiebert's organization was to generate business by persuading potential customers to select the Hiebert line." Id. at 1316. The court further stated that the sales representatives "served no purpose other than the promotion of products on behalf of Hiebert and other represented manufacturers." Id. at 1317.
We find Hiebert persuasive. Like the sales representatives in Hiebert, Leopold's independent sales representatives appear to "closely resemble employees" in their duties. Hiebert, 612 F.Supp. at 1340. Roberts Filter has not produced any evidence to the contrary. Rather, counsel for Roberts Filter attempted at oral argument to establish concerted action by asserting that the independent sales representatives have independent interests, presumably the commissions they were to receive. (See also Roberts Filter's Brief at 31) We find this insufficient to establish a capacity to conspire. See American Standard Life & Accident Ins. Co. v. U.R.L., Inc., 701 F.Supp. 527, 537, fn. 5 (M.D.Pa.1988) (summarily rejecting the plaintiff's argument that the defendant insurance agents' interest in commissions sufficiently separated their goals from that of the defendant corporation to permit the conclusion that the agents could conspire with their own employing insurance agency), see also Hiebert, 788 F.2d at 1317 ("Substance, not form, should determine whether a separately incorporated entity is capable of conspiring under § 1").
Roberts Filter cites Tamaron Distrib. Corp. v. Weiner, 418 F.2d 137 (7th Cir.1969) in support of its position that independent manufacturer representatives can be separate actors for the purpose of a section 1 violation. The Tamaron court, however, in reaching its holding relied upon a Supreme Court case which held that when corporations "avail themselves of the privilege of doing business through separate corporations, the fact of common ownership could not save them from any of the obligations that the law imposes on separate entities." Id. at 139. This premise was rejected by the Supreme Court's decision in Copperweld. Tamaron is therefore not persuasive. See Hiebert, 612 F.Supp. at 1339 (The holding of Tamaron has been cast into doubt in light of Copperweld).
*447 In support of its position that an attorney may be a separate individual with whom the client may engage in concerted action in violation of antitrust law, Roberts Filter cites Tillamook Cheese & Dairy Ass'n v. Tillamook County Creamery Ass'n, 358 F.2d 115 (9th Cir.1966) and Brown v. Donco Enter., Inc., 783 F.2d 644 (6th Cir.1986). These cases do not support Roberts Filter's position, however. In Tillamook and Brown, the discussion concerning the potential liability of the lawyer concerned the potential liability for attempted monopolization under section 2 of the Sherman Act.
We find that Roberts Filter has failed to come forward with sufficient evidence to demonstrate that the conduct of Leopold, its independent sales representatives, and its patent attorney amounts to anything more than unilateral action. Summary judgment must therefore be granted with respect to the claim under section 1 of the Sherman Act.
We next address whether Roberts Filter has (1) established a relevant market and (2) has demonstrated that Leopold has sufficient market power to come dangerously close to achieving a monopoly.
Section 2 of the Sherman Act provides, in relevant part:
Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony ...
15 U.S.C.A. § 2 (West Supp.1994).
Roberts Filter argues in its brief that Leopold "has sufficient market power to pose a dangerous probability of achieving monopoly." (Roberts Filter's Brief at 36) To demonstrate attempted monopolization under section 2 of the Sherman Act, a plaintiff must prove (1) that the defendant has engaged in predatory or anticompetitive conduct with (2) the specific intent to monopolize and (3) that the defendant has a dangerous probability of achieving monopoly power. Pastore v. Bell Tel. Co. of Pa., 24 F.3d 508, 512 (3d Cir.1994), citing Spectrum Sports, Inc. v. McQuillan, ___ U.S. ___, ___ - ___, 113 S.Ct. 884, 890-891, 122 L.Ed.2d 247 (1993).
The specific determination of whether the "dangerous probability" requirement has been met "requires inquiry into the relevant product and geographic market and the defendant's economic power in that market." Pastore, 24 F.3d at 512, citing Spectrum Sports, ___ U.S. at ___, 113 S.Ct. at 892. (internal citations omitted) Relevant product market has been defined as "those commodities reasonably interchangeable by consumers for the same purposes." Tunis Bros. Co., Inc. v. Ford Motor Co., 952 F.2d 715, 722 (3d Cir.1991), citing United States v. E.I. duPont de Nemours & Co., 351 U.S. 377, 395, 76 S.Ct. 994, 1007, 100 L.Ed. 1264 (1956). Relevant geographic market has been defined as "the area in which a potential buyer may rationally look for the goods or services he or she seeks." Tunis Bros., 952 F.2d at 726, citing Pennsylvania Dental Ass'n v. Medical Serv. Ass'n of Pa., 745 F.2d 248, 260 (3d Cir., 1984).
Once the plaintiff has met its burden of defining the relevant market, a court must then determine whether the plaintiff has demonstrated that "the defendants possessed sufficient market power to come dangerously close to success within the market." Pastore, 24 F.3d at 513, citing Fineman v. Armstrong World Indus., Inc., 980 F.2d 171, 197 (3d Cir.1992), and Barr Labs., Inc. v. Abbott Labs., 978 F.2d 98, 112 (3d Cir.1992).
In analyzing whether Leopold possesses sufficient market power, we must review various factors which "include the strength of the competition, probable development of the industry, the barriers to entry, the nature of the anti-competitive conduct, and the elasticity of consumer demand." Pastore, 24 F.3d at 513, citing Barr Labs, 978 F.2d at 112. A significant factor is whether Leopold possesses a "significant market share when it undertakes the challenged anticompetitive conduct." Id. Market share is significant, but not exclusive in determining market power. Id.
Roberts Filter alleges that "[i]n this instance, the relevant market geographically, is *448 the United States. It is a market comprised of municipalities and public authorities responsible for the construction and maintenance of filter plants." (Roberts Filter's Brief at 35) Roberts Filter further asserts that "[w]ith regard to the product, the market is the sale of underdrain filter block and porous plate for new construction and porous plate for rehabilitation." (Roberts Filter's Brief at 35; see also Roberts Filter's Reply Outline p. 5) In support of these assertions, Roberts Filter relies upon the deposition testimony of Marvin Brown, numerous letters written by Brown, and the affidavit of R. Lee Roberts, the CEO of Roberts Filter.
Specifically, Roberts Filter relies upon the following deposition testimony of Marvin Brown who was President and CEO of Leopold:
Q: When you refer to the F.B. Leopold Company as an industry and world leader, what do you mean; what did you have reference to?
A: Well, we have the largest share of market of water filter, water gravity filter installations in the United States.
Q: What is that share?
A: I can't give you a precise number, but probably something like 75 percent.
Q: And what market would that be?
A: The United States.
Q: In what; water filtration installations?
A: Yes.
Q: And would that also be true for underdrain products, or would your actual market share be higher?
A: No, that's probably underdrains that I'm referring to; it's the underdrains and related equipment in a filter.
Deposition of Marvin Brown, June 28, 1993, Volume I of Roberts Filter's Exhibits, Exhibit 79 p. 138-139.
Brown subsequently filed a notarized addendum to this deposition testimony dated August 10, 1993, which states:
I did not understand your question regarding Leopold's share of the market for water gravity filter installations. The 75% that I reference is my estimate of the number of jobs awarded to Leopold out of total jobs bid. Further investigation suggests that Leopold obtains roughly 2/3 of the filter underdrain jobs on which it bids.
Leopold's Exhibits (Antitrust), Exhibit 29, p. 3. (emphasis in original)
The letters written by Marvin Brown which are relied upon by Roberts Filter include statements such as "[w]e are the undisputed market share leader in filter underdrains in the USA and Canada," (Volume I of Roberts Filter's Exhibits, Exhibit 77), and, "[a]s you know, the F.B. Leopold Company is an industry and world leader in filtration systems." (Volume I of Roberts Filter's Exhibits, Exhibit 45)
Roberts Filter also relies upon the affidavit of R. Lee Roberts in support of its definition of the relevant market and Leopold's market share. R. Lee Roberts states that:
6. According to my in-depth knowledge and experience of [sic] the market for factory supplied underdrain systems for water filtration systems, Leopold and Roberts are the only significant providers of underdrain equipment.
7. Leopold clearly has the dominant market share (approximately 80 percent in the past two or three years) for underdrain systems. Roberts clearly had most of the remainder of the market. Any other providers, such as Infilco Degremont, EIMCO or General Filter had less significant market shares. In the market for porous plate/underdrain block systems, however, Leopold has 100%.
. . . . .
9. Roberts began to provide products and services for the underdrain systems market approximately 100 years ago.
10. Leopold began to provide products and services for the underdrain systems market approximately 70 years ago.
11. The market for filtration equipment exists primarily in the United States among several thousand municipalities and public authorities which own and operate water treatment facilities. Many of these facilities are old. Roberts supplied filtration equipment to Reading's Maiden Creek Filter Plant ("MCFP") in 1934, for example. Many need to be upgraded or expanded *449 because of recent changes in federal and state law regarding clean drinking water.
12. In addition to new construction, therefore, there is a significant market for rehabilitation. Many of the plants that will require rehabilitation were originally designed using Roberts Wheeler bottom or Roberts or Leopold's ceramic clock underdrain.
. . . . .
18. The potential for new installations of underdrain nationwide is approximately an average of 200,000 square feet per year, or more depending on the existence of some large 25-50,000 square feet projects.
19. At an average cost of $120-$150 per square foot, the total yearly market for filtration equipment will be between $25,000,000 to $30,000,000. I estimate that approximately one-half of that will involve rehabilitation. About one-half will involve the separate market in porous plate systems. In many of the municipalities with older systems, there is a need to meet the new Federal and State water quality standards as well as increase the production of clean water for consumers. There are only a certain number of ways to do this. They can build new plants, build new expansions on old plants or rehabilitate old plants in such a manner as their production capabilities are increased. One of the methods available to rehabilitate an old filter bed and increase quality and production is to replace the 12 to 18" of support gravel with something like a porous plate, thereby allowing for the use of more filter media. This is a method of quality and production increase which will interest a number of engineers and consumers.
Original Affidavit of R. Lee Roberts ¶ 7-19; see also Volume I of Roberts Filter's Exhibits, Exhibit 2.
Although Roberts Filter did not address the interchangeability of the identified product in its original brief, Roberts Filter argues in its Reply Outline that the underdrain filter system utilizing porous plate is "a unique product which is not reasonably interchangeable for the same purpose with any other identified product, especially when used to rehabilitate older shallow-bed filters ... [T]he porous plate product serves a special purpose and is therefore distinctive." (Reply Outline of Roberts Filter, p. 5) Roberts Filter later asserts that "[t]his is a case in which a unique product serves a specialized purpose, i.e., to replace support gravel in shallow filter beds where the engineer, without reconstructing the entire bed, seeks to increase the depth of the filter media." (Reply Outline of Roberts Filter, p. 6) This assertion is not supported by any competent evidence of record.
Leopold, on the other hand, argues with respect to the relevant market that Roberts Filter "has not identified any experts, economic or otherwise, to determine and testify as to the relevant market in this case ... There are no sales figures of record relating to the many other filter underdrain and support gravel suppliers in the United States and abroad ... [Furthermore,] counsel for both parties ... agreed, pursuant to Defendant's request, that Defendant need not produce their sales information as long as they returned Leopold's information and agreed not to use it in any form or for any purpose at trial." (Leopold's Brief in Support of Summary Judgment (Antitrust), p. 21-22) Leopold additionally argues, with respect to the market power analysis, that Roberts Filter "succeeded in having Leopold's patented design dropped from consideration by the City [of Reading] and achieving a position as the sole approved supplier ... [Roberts Filter's] ultimate position in the Reading specification is much more desirable than the original `or equal' position of Leopold, since [Roberts Filter] had zero competition with the bidding contractors." (Leopold's Brief in Support of Summary Judgment, (Antitrust), p. 17, 18) Leopold concludes that "[i]t is inconceivable that [Leopold] can have the requisite market power in the relevant product and geographic market and yet, on the only two jobs highlighted by Roberts, Roberts won the first job and remains on an equal footing with [Leopold] on the second." (Leopold's Reply Brief, p. 11)
With respect to the various factors which should be considered in determining market power, Leopold argues that because Roberts *450 Filter was able to ultimately become the sole approved supplier for the City of Reading job, from which Leopold was completely eliminated from consideration, a high elasticity of consumer demand, strong competition in the market, and low barriers to entry have been displayed. (Leopold's Brief in Support of Summary Judgment (Antitrust) p. 18) Leopold also alleges that "there are several other water filtration technologies which Plaintiff and Defendant must compete with every day." Leopold states in its brief that "these alternatives include reverse osmosis, diatomaceous earth, slow sand filtration, nozzle bottoms, pressure filters, carriage filters and others." (Leopold's Brief in Support of Summary Judgment (Antitrust) p. 19) Roberts Filter challenges this statement for lack of supporting evidence.
We begin by determining whether Roberts Filter has met its burden of defining the relevant markets. Counsel for Roberts Filter initially defined the relevant product market as "the sale of underdrain filter block and porous plate for new construction and porous plate for rehabilitation," and has defined the relevant geographic market as the United States. (Roberts Filter's Brief at 35) Leopold does not specifically challenge the definition of the relevant geographic market; however, Leopold does contest Roberts Filter's definition of the relevant product market. We find that Roberts Filter has failed to produce sufficient evidence to establish a relevant product market.
Initially, we would note that Leopold summed up the problems with Roberts Filter's relevant product market analysis aptly when it stated that "[e]ven upon reading Mr. Roberts' Affidavit, one still has no sense as to what exactly the relevant market is." (Leopold's Reply Brief, p. 6) Indeed, Mr. Roberts' affidavit speaks of several different markets including: (1) the market for porous plate/underdrain block systems in concrete structures producing 1 million gallons or more of water per day (¶ 5); (2) the market for factory supplied underdrain systems for water filtration systems (¶ 6); (3) the market for underdrain systems (¶ 7); (4) the market for filtration equipment (¶ 11); (5) the market for rehabilitation of the plastic Universal Underdrain (¶ 17); and (6) the market for rehabilitation (¶ 12). In its argument concerning tying, Roberts Filter states that "there existed in 1989 and continues to exist separate markets for tying purposes for both porous plate and plastic or ceramic underdrain block." (Roberts Filter's Brief, p. 62) Additionally, Roberts Filter's counsel has described the relevant market as "underdrain filter systems utilizing porous plate." (Reply Outline at 5)
To the extent that Roberts Filter attempts to define the relevant market in terms of the sale of underdrain filter block and porous plate for new construction and porous plate for rehabilitation, we find that this definition fails because Roberts Filter has not produced evidence or analyzed the product in terms of interchangeability.
Roberts Filter argues that "Leopold has offered no evidence from which one can conclude that the other filtration processes which it has identified are indeed `interchangeable with the porous cap filtering system.'" (Roberts Filter's Reply Outline, p. 5) However, it is the burden of Roberts Filter to prove that the relevant market is "underdrain filter block and porous plate for new construction and porous plate for rehabilitation" and that other filtration alternatives "available for sale were not reasonably interchangeable." Tunis Bros., 952 F.2d at 724 (internal quotations omitted).
The Supreme Court has stated that "[i]nterchangeability is largely gauged by the purchase of competing products for similar uses considering the price, characteristics and adaptability of the competing commodities." United States v. E.I. duPont de Nemours & Co., 351 U.S. 377, 380-81, 76 S.Ct. 994, 999, 100 L.Ed. 1264 (1956). "At a minimum, the product market must take into account the various types of [systems] which consumers would utilize as a substitute for the ... product." Pastore v. Bell Telephone Co. of Pennsylvania, 1993 WL 664548 at *6 (W.D.Pa. Sept. 22, 1993). While Roberts Filter has summarily alleged that an underdrain filter system utilizing porous plate is unique and not reasonably interchangeable with any other identified product, Roberts Filter provides no evidence or analysis for *451 this assertion, nor has it analyzed the price, characteristics or adaptability of the competing commodities. Moreover, while the porous plate may indeed be unique or different from other products, it is clear that "where there are market alternatives that buyers may readily use for their purposes, illegal monopoly does not exist merely because the product said to be monopolized differs from others." Id. at 394, 76 S.Ct. at 1006.
The fact that Leopold did not produce any evidence to the contrary is not essential. It is undisputed that the alternative underdrain/support gravel system was ultimately used by Roberts Filter for the Maiden Creek Filter Rehabilitation Project. Roberts Filter has not offered evidence which would tend to explain why this system was not viewed by the City of Reading "as a substitute for the [underdrain/porous plate] product." Id. Roberts Filter's assertion that "Roberts does not have to be satisfied with having to try and convince every engineer that they should use an entirely different kind of system which does not serve the specific purpose that the engineer originally specified," even if supported by competent evidence, does not explain why an underdrain/support gravel system is not viewed by the consumer as a substitute for the Leopold product.
Moreover, R. Lee Roberts' affidavit, itself, indicates reasonable interchangeability. Roberts states that "one of the methods available to rehabilitate an old filter bed and increase quality and production is to replace the 12 to 18" of support gravel with something like a porous plate, thereby allowing for the use of more filter media." (Affidavit of R. Lee Roberts, ¶ 19) (emphasis added) Roberts further states that the porous plate "is a method of quality and production increase which will interest a number of engineers and consumers." (Affidavit of R. Lee Roberts, ¶ 19) (emphasis added) This indicates the availability of other systems.
The Third Circuit has stated that "a well-defined submarket may constitute a relevant product market and so under certain circumstances a relevant product market could consist of one brand of a product." Tunis, 952 F.2d at 723. However, the determination that a submarket constitutes a relevant product market includes examining "such practical indicia as industry or public recognition of the submarket as a separate economic entity, the product's peculiar characteristics and uses, unique production facilities, distinct customers, distinct prices, sensitivity to price changes, and specialized vendors." Tunis, 952 F.2d at 723, citing Brown Shoe Co. v. United States, 370 U.S. 294, 325, 82 S.Ct. 1502, 1524, 8 L.Ed.2d 510 (1962). Roberts Filter has not set forth evidence sufficient to conduct such an examination.
We recognize that generally "the determination of a relevant product market or submarket ... is a highly factual one best allocated to the trier of fact." Fineman v. Armstrong World Indus., Inc., 980 F.2d 171, 199 (3d Cir.1992). However, Leopold has demonstrated that Roberts Filter has failed to produce evidence sufficient to establish the existence of an element essential to Roberts Filter's case, and on which Roberts Filter will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). Since the traditional summary judgment standard applies with equal force in antitrust cases, Alvord-Polk, Inc. v. F. Schumacher & Co., 37 F.3d 996, 1001 (3d Cir.1994), we find that summary judgment is appropriate because Roberts Filter has failed to offer sufficient evidence from which a reasonable jury might find that the universal underdrain/porous plate constitutes the relevant product market.
With respect to any broader definition, Roberts Filter has come forward with no evidence which would indicate how a broader market could be defined.
Although Roberts Filter has not defined a relevant product market, we nevertheless address the question of whether Roberts Filter has come forward with sufficient, competent evidence to establish that Leopold has sufficient market power to come dangerously close to success within the market. Leopold argues that even if a relevant market were found to exist, that market power has not been established. We agree.
In M & M Medical Supplies v. Pleasant Valley Hosp., 981 F.2d 160, 166 (4th Cir. *452 1992), cert. denied, ___ U.S. ___, 113 S.Ct. 2962, 125 L.Ed.2d 662 (1993), Plaintiff filed suit alleging six separate antitrust claims which included a claim for attempted monopolization under section 2 of the Sherman Act. See M & M Medical Supplies v. Pleasant Valley Hosp., 738 F.Supp. 1017, 1018 (S.D.W.Va.1990). The district court granted the defendant's motion for summary judgment finding, inter alia, that the plaintiff failed to establish that the defendant had monopoly power in the relevant product and geographic markets. In reaching its decision, the district court found that the affidavit of the plaintiff's economic expert had "set forth no facts to support these opinions," and had provided "no specific examples" of the defendant's anticompetitive conduct. Id. 738 F.Supp. at 1020. The Fourth Circuit, en banc, reversed the district court's holding and found that the affidavit of the plaintiff's economic expert "was far more than a conclusory statement based on general antitrust theory." Pleasant Valley, 981 F.2d at 164. Rather, the court found that what was omitted from the affidavit was not facts or reasons, but rather the underlying data supporting the facts. Id., 981 F.2d at 164-65. The Fourth Circuit found that the lack of underlying data supporting an affiant's assertion of fact does not mandate exclusion of the affidavit under Fed.R.Civ.P. 56, so long as the affidavit is not wholly conclusory and devoid of reasoning. Id. 981 F.2d at 165.
We find Pleasant Valley persuasive in the case at bar. Under the rationale of Pleasant Valley, while the underlying data supporting an affiant's assertion need not be submitted with the affidavit, an expert's conclusory affidavit lacking facts or reasons does not satisfy the requirements of Fed.R.Civ.P. 56(e). That is exactly the situation presented by the Affidavit of R. Lee Roberts and the deposition testimony of Marvin Brown in the case at bar.
Specifically, although R. Lee Roberts states that "Leopold clearly has the dominant market share (approximately 80 percent in the past two or three years) for underdrain systems," and that "[i]n the market for porous plate/underdrain block systems ... Leopold has 100%," Roberts provides no facts or reasons for reaching this conclusion. (Affidavit of R. Lee Roberts, ¶ 7) Roberts goes on to state that "[a]t an average cost of $120-$150 per square foot, the total yearly market for filtration equipment will be between $25,000,000 to $30,000,000. I estimate that approximately one-half of that will involve rehabilitation. About one-half will involve the separate market in porous plate systems." (Affidavit of R. Lee Roberts, ¶ 19) Once again, no facts or reasons are given for these "estimates." Such conclusory statements are insufficient to establish market share. See Pleasant Valley, 981 F.2d at 164-65.
The deposition testimony of Marvin Brown is similarly defective. First of all, it is not clear to what market share Mr. Brown is referring. For example, Mr. Brown first states that Leopold "probably [has] something like 75 percent," of the market share in filtration installations. (Deposition of Marvin Brown, supra) Then Mr. Brown goes on to state that it was probably the underdrains and related equipment in a filter that he was referring to. To further obfuscate the issue, Mr. Brown files an addendum to his testimony wherein he states that the 75% referenced his "estimate of the number of jobs awarded to Leopold out of total jobs bid." (Leopold's Exhibits as to Defendant's Antitrust Counterclaim, Exhibit 29, p. 3) Secondly, Mr. Brown at no time states any facts or reasons in support of his "estimate." This testimony is insufficient to establish market power. For the same reason, the letters written by Brown wherein Brown claims that Leopold is the undisputed market share leader are insufficient to establish market share in a relevant market.
While it appears as though many parties in antitrust cases utilize expert testimony in order to establish relevant market and market power, we have found no authority which indicates that expert testimony is required, and we do not venture to so hold. See e.g. Bacchus Indus., Inc. v. Arvin Indus., Inc., 939 F.2d 887, 894 (10th Cir.1991) (While finding that the plaintiff failed to present sufficient evidence of dangerous probability that the defendant could achieve monopoly status in the relevant market, the court stated *453 that the testimony of former employee of the defendant, an employee of the plaintiff, and the president of the plaintiff company sufficient to support claim that defendant held a significant market share.)
Something more than conclusory allegations, however, must be presented in order to withstand summary judgment. While Roberts Filter, in attempting to demonstrate the nature of Leopold's alleged anti-competitive conduct, may very well have set forth a sound basis for its inequitable conduct theory in the patent infringement count (see Roberts Filter's Supplemental Memorandum in Opposition to Summary Judgment on the Antitrust Counterclaims), we find that such alleged anti-competitive conduct, in and of itself, is insufficient to establish an antitrust cause of action. See Spectrum Sports, ___ U.S. at ___, 113 S.Ct. at 892 ("The concern that § 2 might be applied so as to further anticompetitive ends is plainly not met by inquiring only whether the defendant has engaged in `unfair' or `predatory' tactics.").
Roberts Filter has established neither a relevant market nor the market power of Leopold. Summary judgment must therefore be granted as to Roberts Filter's antitrust claims under section 2 of the Sherman Act, and Walker Process.[10]
Finally, we address Roberts Filter's tying claim. Quite clearly put, "[t]ying exists when a seller of product A requires his purchasers to take product B as well." R. Bork Antitrust Paradox at 365 (1993). See also Allen-Myland, Inc. v. International Business Machines Corp., 33 F.3d 194, 200 (3d Cir.1994), cert. denied, ___ U.S. ___, 115 S.Ct. 684, 130 L.Ed.2d 615 (1994). A tying arrangement violates section 1 of the Sherman Act if "the seller has `appreciable economic power' in the tying product market and if the arrangement affects a substantial volume of commerce in the tied market." Eastman Kodak Co. v. Image Technical Servs., Inc., 504 U.S. 451, 462, 112 S.Ct. 2072, 2079, 119 L.Ed.2d 265 (1992) (internal quotations omitted).
Initially, a court in a section 1 tying case must determine whether "the defendant has sufficient market power over the tying product, which requires a finding that two separate product markets exist and a determination of precisely what the tying and tied product markets are." Allen-Myland, 33 F.3d at 200-201. In discussing the policy concerns behind finding tying arrangements violative of section 1 of the Sherman Act, the Third Circuit has stated that:
The antitrust concern over tying arrangements is limited to those situations in which the seller can exploit its power in the market for the tying product to force buyers to purchase the tied product when they otherwise would not, thereby restraining competition in the tied product market.
Id. at 200.
Roberts Filter defines the unlawful tying arrangement in this case as "Plaintiff's market control is such that it can require customers to purchase both underdrain block and porous plate cap from plaintiff when there are or may be separate markets for each of such products." (Roberts Filter's Brief at 57, citing Amended Answer and Counterclaim) Roberts Filter does not, however, specify which is the tying and which is the tied product. At one point in its brief, Roberts Filter states that "[t]he tying product is not necessarily the underdrain block, because, as Plaintiff notes in its Brief, the patent on the Universal Underdrain expires in December, 1994." (Roberts Filter's Brief at 62) Leopold assumes in its brief that the tying product is the underdrain block. (Leopold's Brief in Support of Summary Judgment (Antitrust) p. 22-23)
We find that if tying exists, then the arguments of Roberts Filter most logically point to the porous plate as being the tying product. Roberts Filter has not argued that when one purchases a Universal Underdrain, *454 that one must necessarily purchase a porous plate. Rather, Roberts Filter argues that if one purchases a porous plate, that one must necessarily purchase a Universal Underdrain in order to avoid infringing Leopold's patent. (See Roberts Filter's Brief, p. 60-61, quoting Mr. Brown's assertion that "it's very difficult to imagine any design where you affix a porous plate to the top of a lateral underdrain without infringing.") Indeed, underdrain blocks, such as Leopold's Universal Underdrain[11] have been conventionally used in conjunction with support gravel, rather than porous plates. (See Leopold's Brief in Support of Summary Judgment (Antitrust), p. 3; see also Roberts Filter's Brief, p. 7-8) In fact, counsel for Roberts Filter represented to the Court at oral argument that support gravel was used by Roberts Filter for the Maiden Creek Filter Rehabilitation project.
Having determined that the porous plate is the tying product, we next must determine whether Roberts Filter has demonstrated that Leopold has "appreciable economic power in the tying market." Eastman Kodak, 504 U.S. at 464, 112 S.Ct. at 2080. Interestingly, the porous plate, itself, is patented. The patent, which was issued on November 21, 1989, is held by Joseph Ferri, the owner of General Polymerics, the company that manufactures the Leopold porous cap. (See Volume I of Roberts Filter's Exhibits, Exhibit 11) Polymerics sells this plate to other companies for use in water filtration systems. (See e.g. Volume I of Roberts Filter's Exhibits, Exhibit 101, p. 57-59) According to Roberts Filter, Porex Technologies, Inc. of Fairburn Georgia also manufactures a porous plate. (Roberts Filter's Brief at 9) Roberts Filter has not come forward with evidence which would tend to indicate that Leopold has market power in the porous plate market.
We recognize the problems faced by Roberts Filter in attempting to use porous plate technology. (See, e.g. Roberts Filter's Brief, p. 62, 63 "[I]f one wants to rehabilitate a system in which Leopold Universal underdrain block had been installed, one should be able to buy the porous plate from General Polymerics because General Polymerics may be willing to sell it cheaper than Leopold," and "if one wants to purchase porous plate and use it with an underdrain manufactured by a company other than Leopold, the '427 patent will be infringed, according to Brown.") However, those problems do not excuse Roberts Filter from coming forward with sufficient evidence to establish all the elements of its illegal tying claim.
Accordingly, we find that Roberts Filter has failed to establish all the elements of an illegal tying arrangement. Summary judgment on this claim will be granted.
Finally, Leopold asks this Court to exclude Roberts Filter from putting forth any evidence concerning its Fourth, Sixth, Seventh, Twelfth and Sixteenth Affirmative Defenses at trial. This argument can more appropriately be addressed as a motion in limine.
ORDER OF COURT
AND NOW, this 10th day of March, 1995, pursuant to the Opinion attached hereto, and for the reasons set forth in the Opinion accompanying this Order, it is hereby ORDERED that the Motion for Summary Judgment (Doc. 159) filed by The F.B. Leopold Company with regard to the Counter-Claim filed by Roberts Filter concerning defamation is GRANTED in part and DENIED in part.
It is further ORDERED that the Motion for Summary Judgment (Doc. 156) filed by the F.B. Leopold Company with regard to the Counter-Claim filed by Roberts Filter concerning anti-trust claims is GRANTED as to all the anti-trust claims.
It is further ORDERED that a Pre-Trial Conference will be held on Friday, April 21, 1995 at 9:00 A.M. at which time counsel must appear with authority to settle from their clients.
NOTES
[1] Leopold has filed a brief in support of each of its motions and a succinct reply brief. Roberts Filter has filed a single, one hundred and ten (110) page brief in opposition to Leopold's motions. After oral argument, Leopold filed an Outline of Leopold's Argument in Support of Summary Judgment on the Anti-trust Claims and Roberts Filter filed a Supplemental Memorandum in Reply to Matters Raised by Leopold for the First Time at Oral Argument, a Supplemental Memorandum in Opposition to Leopold's Motion for Summary Judgment on Anti-trust Counterclaims, and a Reply Outline in Opposition to Summary Judgment on Anti-trust Claims.
[2] The second patent at issue is also a patent for "Cap for Underdrains in Gravity Filters." This patent is numbered 5,232,592 and is referred to by the parties as the "592 patent." (See Volume II of Roberts Filter's Exhibits, Exhibit 115)
[3] IMS (Integral Media Support System) "consists of a molded high molecular weight, high density polyethelen [sic] cap designed to fit over the universal underdrain block." (See Leopold's Exhibits (Antitrust), Exhibit 31, p. 2)
[4] This section provides:
One who is required by law to publish defamatory matter is absolutely privileged to publish it.
Restatement (Second) of Torts § 592A (1977).
[5] In support of the public concern argument, Leopold directs the Court to the Restatement (Second) of Torts § 598. This section provides:
An occasion makes a publication conditionally privileged if the circumstances induce a correct or reasonable belief that
(a) there is information that affects a sufficiently important public interest, and
(b) the public interest requires the communication of the defamatory matter to a public officer or a private citizen who is authorized or privileged to take action if the defamatory matter is true.
Restatement of Torts (Second) § 598 (1977).
[6] McIlvaine stated during his deposition:
Q: Does this document help refresh your recollection that Leopold's [sic] specifically was attempting to make the 592 Patent cover Roberts' design?
. . . . .
A: I would agree to the extent that both myself and Leopold were conscious at the time of the fact that the claims which we were pursuing would, in addition to the 427 Patent, cover the Roberts' design.
Deposition of John McIlvaine, August 20, 1993, p. 314, Volume II of Roberts Filter's Exhibits, Exhibit 111.
[7] This disposition does not preclude Roberts Filter from pursuing Count II of its Counterclaim under section 43(a) of the Lanham Act.
[8] Walker Process Equipment, Inc. v. Food Machinery and Chemical Corp., 382 U.S. 172, 86 S.Ct. 347, 15 L.Ed.2d 247 (1965).
[9] McIlvaine is also counsel of record in this case.
[10] If all of the prerequisites to a section 2 claim are shown, then a patent owner can be liable for enforcement of a patent known to be procured by fraud. Walker Process Equip. Inc. v. Food Mach. & Chem. Corp., 382 U.S. 172, 174, 86 S.Ct. 347, 349, 15 L.Ed.2d 247 (1965). Since we have determined that Roberts Filter has failed to allege facts sufficient to withstand summary judgment on the section 2 claim, the Walker Process claim must necessarily be dismissed.
[11] The Universal Underdrain was originally patented in 1977. The patent expired in December, 1994. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603817/ | 135 Mich. App. 660 (1984)
354 N.W.2d 297
DETROIT POLICE OFFICERS ASSOCIATION
v.
CITY OF DETROIT
Docket No. 73718.
Michigan Court of Appeals.
Decided May 21, 1984.
Gregory, Van Lopik, Moore & Jeakle (by Nancy Jean Van Lopik), for plaintiff.
Donald Pailen, Corporation Counsel, Mark R. Ulicny, Deputy Corporation Counsel, and Frank *662 W. Jackson and Linda C. Ragland, Assistants Corporation Counsel, for defendant.
Amicus Curiae:
Sachs, Nunn, Kates, Kadushin, O'Hare, Helveston & Waldman, P.C. (by Theodore Sachs and Mary Ellen Gurewitz).
Before: J.H. GILLIS, P.J., and T.M. BURNS and N.J. KAUFMAN,[*] JJ.
PER CURIAM.
Plaintiff appeals as of right from the denial of its motion for summary judgment and the grant of defendant's motion for summary judgment dismissing plaintiff's complaint.
The parties agree on the operative facts. Plaintiff, the Detroit Police Officers Association (DPOA), is the exclusive collective-bargaining representative for police officers below the rank of sergeant employed by defendant, the City of Detroit. Under Article 6D of the parties' collective-bargaining agreement, the police department retained "the right to determine reasonable schedules of work". The city and DPOA signed an addendum to their collective-bargaining agreement on June 22, 1981, which provided at ¶ 20 for an experimental permanent shift program which was to begin within six months from the date of the agreement, and was to "continue for one year at which time the parties shall negotiate as to whether or not it shall continue".
Permanent shifts were instituted at two precincts on November 1, 1981. A year later, plaintiff received a letter from the chief of police dated November 1, 1982, in which the chief stated that, *663 pending negotiations concerning extension of the experimental shift program, as agreed to in ¶ 20 of the addendum, the permanent shift assignments would continue. By June 8, 1983, however, presumably under authority of Article 6D, the city announced that it would return to rotating shifts in those precincts on July 3, 1983, unless the DPOA could convince it to do otherwise. Negotiations held during June, 1983, apparently proved fruitless. On June 28, 1983, the DPOA filed a request for a proceeding under 1969 PA 312, as amended, MCL 423.231 et seq.; MSA 17.455(31) et seq., which provides for compulsory arbitration of disputes which occur in police and fire departments. On the same day, this suit was filed, alleging a prospective violation of § 13 of that statute, which reads:
"During the pendency of proceedings before the arbitration panel, existing wages, hours and other conditions of employment shall not be changed by action of either party without the consent of the other but a party may so consent without prejudice to his rights or position under this act."
In ruling on motions for summary judgment made by each party, the trial court determined that the permanent shifts were not an "existing condition of employment", and, since defendant retained the right to determine reasonable schedules of work in Article 6D of the parties' main collective-bargaining agreement, the court decided that the scheduling of work was not a mandatory subject of bargaining under the statute so that defendant was free to unilaterally alter the schedules.
On appeal, plaintiff argues that the scheduling of shifts is one of the "other conditions of employment" *664 which are mandatory subjects of bargaining which may not be unilaterally changed by action of either party during the pendency of § 13 proceedings before the arbitration panel. Thus, plaintiff contends, defendant had no authority to revert to rotating shifts once plaintiff had invoked an arbitration hearing.
As suggested in the amicus curiae brief filed by the Detroit Fire Fighters Association, we think that the issue in this case should more appropriately be analyzed as whether the scheduling of shifts constitutes "hours". When so phrased, it is apparent that the permanent shift program falls under the category "hours". Act 312 was clearly intended to supplement the public employee relations act (PERA), MCL 423.201 et seq.; MSA 17.455[1] et seq. Local 1277, Metropolitan Council No 23, American Federation of State, County and Municipal Employees, AFL-CIO v Center Line, 414 Mich 642, 652; 327 NW2d 822 (1982). Under § 15 of PERA, issues that fall into the category of "wages, hours, and other terms and conditions of employment" are deemed to be mandatory subjects of bargaining. Id., citing Detroit Police Officers Ass'n v Detroit, 391 Mich 44, 54-57; 214 NW2d 803 (1974). The test generally applied to determine a mandatory subject of bargaining is whether the matter has a significant impact upon wages, hours, or other conditions of employment. Detroit v Michigan Council 25, American Federation of State, County and Municipal Employees, 118 Mich App 211, 215; 324 NW2d 578 (1982), lv den 417 Mich 990 (1983). The scheduling of shifts certainly has an impact on the hours employees work.
Further support for this conclusion comes from federal case law. In general, Michigan has adopted the federal court's approach as to what constitutes *665 a mandatory subject of bargaining, since the phrase "wages, hours, and other terms and conditions of employment" is taken verbatim from the National Labor Relations Act. Center Line, supra, p 653. The United States Supreme Court long ago settled this point:
"Contrary to the Court of Appeals, we think that the particular hours of the day and the particular days of the week during which employees shall be required to work are subjects well within the realm of `wages, hours, and other terms and conditions of employment' about which employers and unions must bargain." Local Union No 189, Amalgamated Meat Cutters & Butcher Workmen of North America, AFL-CIO v Jewel Tea Co, Inc, 381 US 676, 691; 85 S Ct 1596; 14 L Ed 2d 640 (1965).
More recently, the Eighth Circuit Court of Appeals ruled in American Oil Co v National Labor Relations Board, 602 F2d 184, 186 (1979), that revision of a simplified work schedule fell within the category of "hours" so as to be a mandatory subject of bargaining.
Since we conclude that the permanent shift program was a mandatory subject of bargaining, we must reverse the trial court's order granting summary judgment for defendant based on GCR 1963, 117.2(1) and (3). Plaintiff not only stated a claim upon which relief may be granted, but, since there appear to be no factual issues, we find that plaintiff is entitled to relief as a matter of law and that the trial court also erred in denying plaintiff's motion for summary judgment. The city violated § 13 by reverting to rotating shifts after plaintiff had invoked the arbitration proceedings. Thus the trial court also erred in dissolving the preliminary restraining order which was to prevent defendant *666 from reinstating rotating shift assignments pending resolution of the arbitration proceedings.
We do not fault the city's actions; the record indicates that it made every effort to cooperate with plaintiff concerning the experimental shift program. Nor do we dispute the city's scheduling rights under Article 6. Indeed, it was presumably under authority of Article 6 that defendant extended the permanent shift program while negotiations were being held on the program. We hold only that, once plaintiff initiated arbitration proceedings pursuant to the compulsory arbitration statute, defendant was precluded by § 13 of that statute from unilaterally abrogating the permanent shift program which was still in effect when plaintiff demanded arbitration. The direct effect of § 13 is to preserve the status quo pending arbitration proceedings, and to prevent unilateral action such as defendant proposed in this case.
Reversed and remanded for proceedings consistent with this opinion.
NOTES
[*] Former Court of Appeals Judge, sitting on the Court of Appeals by assignment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604152/ | 130 N.W.2d 86 (1964)
Ida S. LINDLAUF, Plaintiff and Respondent,
v.
NORTHERN FOUNDERS INSURANCE COMPANY, Defendant and Appellant.
No. 8036.
Supreme Court of North Dakota.
August 3, 1964.
Rehearing Denied September 10, 1964.
*87 Duffy & Haugland, Devils Lake, for defendant and appellant.
Waldron & Kenner, Minot, for plaintiff and respondent.
BURKE, Judge.
Plaintiff brought this action to recover the avails of an insurance policy upon the *88 life of her deceased husband. In its answer the defendant admitted that it had issued a policy of insurance upon the life of the deceased but alleged that the policy had been issued in reliance upon false representations and warranties made by the deceased and asked that plaintiff's complaint be dismissed. Trial of the case resulted in a verdict and judgment for plaintiff. Subsequent to the entry of judgment defendant moved for judgment notwithstanding the verdict or in the alternative for a new trial. This motion was denied in both of its phases and defendant has appealed both from the order denying his motion and from the judgment.
First for consideration is the appeal from the trial court's order denying judgment for the defendant notwithstanding the verdict. In this connection it is appellant's position that the record in the case, even when viewed in the light most favorable to the plaintiff, establishes a material misrepresentation on the part of insured, and reliance thereupon by the defendant when it issued the policy here in suit.
The specific false representations relied on by the defendant are those contained in the answers given to the medical examiner by the insured at the time he was examined for the purpose of determining his insurability. The answers given to the examining physician which are material to the issues in the case were as follows:
"Q. Have you ever been told that you had or consulted or been treated by a physician or other practitioner for any of the following:
"(c) Disease of the heart or blood vessels?
"A. No.
"(d) Pain in the chest, shortness of breath, coronary artery disease or agina pectoris?
"A. No.
"(e) Increased or abnormal blood pressure?
"A. No."
These answers were given on June 12, 1959. The insured died of myocardial infarction caused by a coronary thrombosis on October 23, 1960.
The record in the case discloses that the insured consulted his physician on January 10, 1956; that at that time he (the insured) suspected that he had coronary trouble and complained of precordial pain radiating to the left arm which became worse on exertion. His blood pressure was 210 over 140. An electrocardiogram was taken but it revealed no evidence of myocardial damage. Insured was given a prescription to relieve his high blood pressure. A week later at a second examination his blood pressure was 184 over 100, and there were no changes in his electrocardiogram. On January 27, 1956, his blood pressure was 160 over 90. In March 1956, his blood pressure was 172 over 90 and insured stated that he had no precordial pain at that time. In April 1956, insured's blood pressure was 148 over 80. In May it was 140 over 80. In August it was 160 over 84. In November it was 188 over 110. In January 1957, it was 162 over 100. In April 1957 it was 154 over 82. In August 1957 it was 130 over 80. In April 1958, it was 160 over 80. In March 1959 it was 132 over 80 and in June 1959 it was 138 over 80. While the record is not entirely clear it appears that electrocardiograms were taken on most of the occasions when the blood pressure was taken and that they revealed no evidence of heart damage. During all the time from January 1956 until June 12, 1959, the date of the insurance medical examination the insured was taking medication to relieve hypertension.
On the face of the record there can be no question but that the answers of the insured, alleged by the defendant to be false, were in fact false. It is contended that these false answers were intended to deceive the defendant and related to matters which increased the risk of loss and that therefore defendant has established a defense to this action as a matter of law.
*89 Plaintiff seeks to avoid the effect of the false answers by a claim that the insured "promptly disclosed to them (the company's agents) at the very outset, the fact that he had high blood pressure and that said insured fully and frankly advised them of having been treated for high blood pressure." The evidence offered by plaintiff does not fully support this claim. Plaintiff's testimony is to the effect that two agents, who solicited the insurance, called at the farm home of her husband; that her husband told the agents: "I think you are wasting your time and mine because I do not think your company is interested in having me as a risk." She then related that he told them that he had had some trouble with high blood pressure in 1956, but that he did not tell them that he had had any recurrence of the high blood pressure or that he had been taking medicine constantly for three years to keep his blood pressure within normal limits, with only partial success.
There is no question but that the gentlemen to whom these statements were claimed to have been made were agents of the defendant insurer. Our applicable statute (Sec. 26-07-02 NDCC) provides that persons who solicit insurance, forward applications therefor or collect premiums therefor shall be regarded as agents of the company. Section 3-03-05 NDCC provides:
"As against a principal, both principal and agent are deemed to have notice of whatever either has notice and ought, in good faith and the exercise of ordinary care and diligence, to communicate to the other."
Thus, while it may be said as a generalization that notice to an agent is notice to his principal, it is clear, that in some circumstances, the question of whether notice to the agent is notice to the principal can become a question of fact. In this case, however, the trial judge considered that no question of fact upon this issue was presented by the evidence and instructed the jury without reservation, that notice to an agent was to be imputed to the principal. We shall consider the merits of the motion for judgment notwithstanding the verdict in accordance with the instruction as given.
Two questions are thus presented. The first is: To what extent did the insurer defendant have notice that the answers given by the deceased insured upon his medical examination, were untrue? The second question is: Were the untrue answers, given by the deceased insured, with respect to matters of which the principal had no notice, material to the risk of loss, or were they given with an intent to deceive the insurer? Section 26-02-25 NDCC provides:
"No oral or written misrepresentation made in the negotiation of a contract or policy of insurance by the insured or in his behalf shall be deemed material or shall defeat or avoid the policy or prevent its attaching unless such misrepresentation shall have been made with actual intent to deceive or unless the matter misrepresented increased the risk of loss."
Under the provisions of the above statute, either a misrepresentation made with the intent to deceive or a misrepresentation material to the risk of loss, without an intent to deceive is a ground to avoid the policy. Thomas v. New York Life Ins. Co., 65 N.D. 625, 260 N.W. 605.
Upon the basis of the evidence most favorable to the plaintiff and the instructions of the trial judge, we assume that defendant at the time it received the report of the insured's physical examination, in June 1959, had prior notice that the insured had had some trouble with high blood pressure in January 1956. It also had notice from the report of the examination that insured's blood pressure was within normal limits at the time the physical examination was taken. The insurer also was falsely informed that the insured had never consulted a physician about his high blood pressure *90 or been treated therefor and that he had never consulted a physician concerning pains in the chest or heart disease. Insurer was also informed that the insured had had one electrocardiogram in a routine physical examination with a normal result.
Thus, from the notice the insurer derived from its agent and from the information derived from the insured's answers to the questions put to him at the time of his medical examination, the insurer would have assumed that the high blood pressure the insured mentioned was a temporary condition which had occurred more than three years prior to the physical examination and had disappeared without any treatment. The insurer was informed that the insured had never complained of pains which were possibly symptomatic of heart disease nor consulted a physician with respect thereto. Upon the basis of the notice derived from its agent and upon the misinformation contained in the medical report the insurer, according to expert testimony, should have had no hesitancy in accepting the insured as a standard risk.
The insured's physician, who testified as plaintiff's witness, testified that he first saw the insured professionally on January 12, 1956. At that time the insured consulted him with respect to suspected coronary trouble. The insured complained of precordial pain radiating to the left arm which was worse on exertion. At that time insured's blood pressure was 210 over 140 and an electrocardiogram showed "no definite evidence of myocardial damage." The physician prescribed medicine to reduce insured's blood pressure at that time. Insured had two more examinations in January 1956, one in March, April, May, August and November 1956, and from that time until the issuance of the policy sued on in July 1959, had about four examinations a year. At most of such examinations electrocardiograms were made. None of them showed evidence of heart damage and there were no further complaints of precordial pain. During all of this time insured was taking medicine to keep his blood pressure within normal limits, but despite the medicine it fluctuated between normal and abnormal limits and on more than half the occasions it was in excess of normal limits. This witness also testified that precordial pain such as the insured described was a symptom of coronary disease, although not necessarily so, and that normal results upon electrocardiograms did not exclude the possibility of heart disease. He also stated that continued high blood pressure could damage the heart, the brain, the kidneys or the arteries, but that the presence of high blood pressure did not necessarily mean that such damage would result. It appears therefore that the insured by his misrepresentations concealed from the insurer the fact that he had had symptoms of possible heart disease and that he had chronic high blood pressure for which he had taken medication for several years.
The question of the materiality of these misrepresentations was submitted to the jury and since the jury found for the plaintiff it must also have found that the misrepresentations did not relate to matters which increased the risk of loss. Unless the evidence in the case was such that the issue of the materiality of the misrepresentation was one of law for the court the jury's finding in this regard must be sustained. In Thomas v. New York Life Ins. Co., 65 N.D. 625, 260 N.W. 605, this court gave extended consideration to the question of when the issue of materiality becomes one of the law for the court. In that case the views of the court were summarized as follows:
"Where the application for an insurance policy is made the basis of the insurance contract, is attached to and made a part of the contract, and there are misrepresentations in the answers of the applicant to the questions in such application, and it appears from the record that reasonable minds could not differ on the question as to whether the matter misrepresented increased the risk of loss, such question is a question of law for the court."
*91 Judge Taft in Penn. Mut. Life Ins. Co. v. Mechanics' Savings Bank & Trust Co., 6 Cir., 72 F. 413, 38 L.R.A. 33 stated:
"* * * A fair test of the materiality of a fact is found, therefore, in the answer to the question whether reasonably careful and intelligent men would have regarded the fact, communicated at the time of effecting the insurance, as substantially increasing the chances of the loss insured against. The best evidence of this is to be found in the usage and practice of insurance companies in regard to raising the rates or in rejecting the risk on becoming aware of the fact. * * *"
In the instant case the application for insurance was by its terms made the basis of, and a part of the insurance contract. It was attached to the policy which was delivered to the insured. The answers made to certain questions in the application by the insured were false and concealed from the insurer the fact that the insured had had symptoms of possible heart disease and that he had been undergoing treatment for over three years for chronic high blood pressure which might damage, the heart, brain, kidneys or other organs. The undisputed testimony is that the insurer would have turned down the application or would have "rated up" the policy had it known these facts, and that such action would have been in accord with the usage and customs of insurance companies.
There is some evidence in the case that the symptoms of possible heart trouble which the insured had might have been symptoms of some insignificant ailment. There was evidence that some people with chronic high blood pressure live to a ripe old age. These considerations are not material to the issues.
Insurance Companies must determine the risks they will assume upon the basis of averages actuarially determined from experience which is at least national in scope. In life insurance the risk insured against is the death of the insured. If, therefore, actuarial experience demonstrates that for individuals of a given age, those with chronic high blood pressure have a shorter life expectancy than those without such high blood pressure, then presence of chronic high blood pressure in an individual increases the risk of loss. The same conclusion must be reached with respect to individuals who have exhibited symptoms of possible heart disease.
The evidence in the case is to the effect that individuals with the symptoms or ailments which the insured had and which he concealed from the insurer by misrepresentation have a shorter life expectancy than individuals without such symptoms. The expert testimony to the effect individuals having such symptoms, had a shorter life expectancy than those without such symptoms, and that the usage and custom of insurance companies was to reject or "rate up" the applications of individuals having such symptoms is not testimony as to opinion but is testimony as to facts. This testimony was undisputed and in our view reasonable minds could not reject it.
Upon our review of the evidence we are satisfied that the misrepresentations made by the insured in his application for insurance related to matters which increased the risk of loss as a matter of law. It was therefore error for the trial court to deny the appellant's motion for judgment notwithstanding the verdict. The case is therefore remanded to the district court with directions to enter judgment dismissing plaintiff's cause of action but decreeing that she is entitled to return of the premiums paid to the defendant with interest thereon at the legal rate.
MORRIS, C. J., and TEIGEN, J., concur.
STRUTZ, J., did not participate.
ERICKSTAD, J. not being a member of the Court at the time of submission of this case did not participate. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604190/ | 8 So. 3d 466 (2009)
William T. CAPPS, Appellant,
v.
INDUSTRIAL BLOWPIPE AND BROADSPIRE-TAMPA, Appellees.
No. 1D08-5263.
District Court of Appeal of Florida, First District.
April 21, 2009.
*467 David A. McCranie of David A. McCranie, P.A., Orange Park, and George D. Rotchford and Neal L. Betancourt of Rotchford & Betancourt, P.A., Jacksonville, for Appellant.
William H. Rogner of Hurley, Rogner, Miller, Cox, Waranch & Westcott, P.A., Winter Park, for Appellees.
WEBSTER, J.
In this workers' compensation case, claimant seeks review of an order rejecting an attorney's fee stipulation entered into between claimant and his lawyer. Claimant contends that the judge of compensation claims committed reversible error in concluding that (1) he lacked jurisdiction to consider the stipulation; and (2) the stipulation was unreasonable. We agree with claimant's first contention. However, we affirm because the conclusion that the stipulation was unreasonable is supported by competent, substantial evidence.
In February 1985, claimant was working on the employer's roof when the roof caught fire. After having been severely burned, claimant jumped from the roof, sustaining multiple fractures to his lower extremities and vertebrae. The employer and carrier accepted the accident as compensable *468 and provided medical treatment, including numerous surgeries.
In addition to medical treatment, claimant requested benefits for care provided by his spouse. After two hearings on the matter, the judge of compensation claims awarded claimant $558,828.64 in attendant care benefits. That order was appealed by the employer and carrier and cross-appealed by claimant. See Indus. Blowpipe v. Capps, 940 So. 2d 442 (Fla. 1st DCA 2006). We affirmed the issue raised in claimant's cross-appeal without comment, but affirmed in part, reversed in part, and remanded as to the attendant care award. Id. Claimant filed a motion for appellate attorney's fees and costs pursuant to section 440.34(3)(a) and (5), Florida Statutes (1983). We denied that motion.
On remand, the parties agreed the employer and carrier would pay a total of $491,762.39 in attendant care benefits owed to claimant. The judge of compensation claims ordered the employer and carrier to pay claimant's lawyer $187,515.00 in attorney's fees for securing those attendant care benefits.
Subsequently, claimant and his lawyer sought approval of a "Stipulation on Employee-Paid Attorney's Fees and Costs." The stipulation provided that claimant would pay his lawyer $62,749.27 in appellate attorney's fees, for 278.89 hours of appellate work at $225 per hour, and that this fee was reasonable because the lawyer had preserved $381,659.04 in benefits.
Concluding that he lacked jurisdiction to approve it because this court had not relinquished jurisdiction after denying claimant's motion for appellate attorney's fees to be paid by the employer and carrier, and that section 440.34(5), Florida Statutes, granted authority to approve only an employer/carrier-paid appellate attorney's fee, not an appellate attorney's fee paid by a claimant, the judge of compensation claims denied the request. He also concluded, in the alternative, that the stipulated attorney's fee was unreasonable because claimant's lawyer had already been compensated for securing the attendant care benefits.
We review de novo the determination that the judge of compensation claims lacked subject matter jurisdiction. See Jacobsen v. Ross Stores, 882 So. 2d 431, 432 (Fla. 1st DCA 2004). Unlike a court of general jurisdiction, a judge of compensation claims does not possess inherent judicial power. See Pace v. Miami-Dade County Sch. Bd., 868 So. 2d 1286, 1287 (Fla. 1st DCA 2004). Such a judge possesses only the authority expressly set out in chapter 440, Florida Statutes. Id. Section 440.33(1), Florida Statutes, provides that a judge of compensation claims may "do all things conformable to law which may be necessary to enable the judge effectively to discharge the duties of her or his office."
It is well-settled that the law in effect on the date of the accident controls an attorney's fee award in a workers' compensation matter. See Ship Shape v. Taylor, 397 So. 2d 1199 (Fla. 1st DCA 1981). Section 440.34, Florida Statutes (1983), provides in relevant part:
(1) No fee, gratuity, or other consideration shall be paid for services rendered for a claimant in connection with any proceedings arising under this chapter, unless approved as reasonable by the deputy commissioner or court having jurisdiction over such proceedings.
....
(2) In awarding a reasonable attorney's fee, the deputy commissioner shall consider only those benefits to the claimant that the attorney is responsible for securing.
(3) .... A claimant shall be responsible for the payment of his own attorney's fees, except that a claimant shall *469 be entitled to recover a reasonable attorney's fee from a carrier or employer: [in certain circumstances].
....
(5) If any proceedings are had for review of any claim ... before any court, the court may award the injured employee or dependent an attorney's fee to be paid by the employer or carrier, in its discretion, which shall be paid as the court may direct.
Appellate attorney's fees paid by an employer or carrier to a claimant are governed by section 440.34(5). By contrast, a stipulated fee paid by a claimant, regardless of whether the fee is for services rendered at the trial level or on appeal, is governed by subsections (1) and (2) of section 440.34. "[T]he statute clearly expresses a preference for a claimant's responsibility for payment of his or her own attorney fees, except under the narrow circumstances specified." Wells Fargo Armored Servs. v. Lee, 692 So. 2d 284, 286 (Fla. 1st DCA 1997), approved, 707 So. 2d 700 (Fla.1998). Consequently, although this court denied claimant's motion for an appellate attorney's fee to be paid pursuant to subsection (5) by the employer and carrier, that denial does not bar a separate attorney's fee agreement pursuant to subsection (1). See Ship Shape, 397 So.2d at 1202 (denying claimant's request for an appellate attorney's fee to be paid by the employer and carrier, but noting that the decision was without prejudice regarding a claimant-paid appellate attorney's fee, if approved as reasonable). Accordingly, we hold that the judge of compensation claims erroneously concluded that he lacked jurisdiction to consider the stipulation.
Pursuant to the plain language of the statute, such fees must be based on benefits secured, and may not be paid unless approved as reasonable by the judge of compensation claims. See § 440.34(1), (2), Fla. Stat. (1983); Taylor, 397 So.2d at 1202. Here, the judge concluded that the attorney's fees agreed to by claimant and his lawyer were unreasonable because the lawyer had already been compensated for the benefits secured.
The record reveals that claimant's lawyer initially obtained an order awarding $558,828.64 in benefits to claimant, withstood a challenge on appeal as to $381,659.04 of those benefits and, through post-appeal negotiations, obtained an additional $110,103.35, for a total of $491,762.39 in benefits. The first order on attorney's fees of the judge of compensation claims awarded claimant's lawyer $187,515.00, based on the final settlement amount of $491,762.39. Therefore, competent, substantial evidence supports the conclusion that the stipulation was unreasonable because claimant's lawyer had already been fully compensated for all benefits actually secured for claimant. See § 440.34(2), Fla. Stat. (1983). Consequently, the JCC's order is affirmed.
AFFIRMED.
BARFIELD and PADOVANO, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3032109/ | United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 03-2675
___________
Louis Jimerson, *
*
Appellant, *
*
v. * Appeal from the United States
* District Court for the Eastern
Raymond M. Meyer, Assistant United * District of Missouri.
States Attorney, *
* [UNPUBLISHED]
Appellee. *
___________
Submitted: August 26, 2003
Filed: August 29, 2003
___________
Before WOLLMAN, FAGG, and MORRIS SHEPPARD ARNOLD, Circuit Judges.
___________
PER CURIAM.
Federal prisoner Louis Jimerson appeals from the district court’s1 preservice
dismissal without prejudice of his civil complaint. Upon careful review of the record,
we conclude that the district court properly dismissed the complaint for the reasons
explained by the court. Accordingly, we affirm. See 8th Cir. R. 47A(a).
1
The Honorable Jean C. Hamilton, United States District Judge for the Eastern
District of Missouri.
A true copy.
Attest:
CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.
-2- | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1603432/ | 354 N.W.2d 432 (1984)
STATE of Minnesota, Respondent,
v.
Todd W. BECKMAN, Appellant.
No. C4-82-1463.
Supreme Court of Minnesota.
September 14, 1984.
*433 C. Paul Jones, Public Defender, Mark F. Anderson, Asst. Public Defender, Minneapolis, for appellant.
*434 Hubert H. Humphrey, III, Atty. Gen., St. Paul, Julius E. Gernes, Winona County Atty., Winona, for respondent.
Considered and decided by the court en banc without oral argument.
WAHL, Justice.
Defendant was charged with aggravated robbery, Minn.Stat. § 609.245 (1982). After the trial court denied his motion to suppress his confession and other evidence on constitutional grounds, defendant waived his right to a trial by jury and agreed to let the trial court determine his guilt on the basis of stipulated facts, thereby preserving his right to raise the suppression issues on appeal without putting the state and himself through the time and expense of a trial. State v. Lothenbach, 296 N.W.2d 854 (1980). The trial court found defendant guilty as charged and sentenced him to 54 months in prison, the then-presumptive sentence pursuant to Minn.Stat. § 609.11 (1982) and Minnesota Sentencing Guidelines and Commentary, II.E. (1982). On this appeal, defendant contends that his confession was the fruit of an illegal arrest, was obtained in violation of Miranda, and was involuntary. We affirm.
At 5:15 a.m. on March 14, 1982, a man wearing a pillowcase over his head, with holes cut in the pillowcase for his eyes, entered the Hiawathaland Truckstop, which is located in Nodine, Minnesota, in southeastern Winona County on Highway I-90. The man was described by the attendant, Tim Albrecht, as being approximately 5 feet 10 inches tall and of medium build. He was armed with a shotgun, described by Albrecht as a Remington 870 pump action shotgun. He told Albrecht to give him all the money from the cash register and from the cash drawer, an unmarked drawer located beneath the cash register. After ordering Albrecht into a storeroom, he fled.
On March 16 Investigator Becky Schossow of the Winona County Sheriff's Office learned from Investigator Brian Wetterlin that on the evening of March 13, the evening before the robbery, someone had burglarized the residence of Nicholas Baumgartner of Hokah in northeastern Houston County, which is just south of Winona County, taking a Remington 870 pump action shotgun. She learned further that Baumgartner reported that he and two friends had driven by the Baumgartner residence at about 10 p.m. on the 13th and had seen defendant's car parked outside. Baumgartner was a friend of defendant and had assumed that defendant was looking for him. Thinking that defendant would look for him at the bar if he was not home, Baumgartner had continued on to the bar. However, defendant had not come to the bar as Baumgartner expected, and when Baumgartner returned home he discovered the burglary and theft. Investigator Schossow also learned that defendant had worked at the truckstop that was robbed, having been fired by the manager, Darlene Wendt, in January. Schossow learned further that defendant shared a trailer home with another man in a trailer park in Dakota, approximately 5 miles east of Nodine on Highway I-90 and 10 miles north of Hokah.
Schossow and Wetterlin agreed to meet at a service station in Dresbach, which is on Highway I-90 about a mile south of Dakota, and try to find defendant and question him. Wetterlin, driving an unmarked squad car, arrived first and unexpectedly saw defendant's car at the station. He noted the car's license and then drove on and radioed Schossow to meet him at a place near the freeway. After leaving the station, he called in the car's license number and learned that the car was registered to defendant's father; he also checked and found that defendant's license was under revocation. As Schossow and Wetterlin were discussing their options, they saw defendant's car approaching with defendant driving and someone on the passenger side. They noted that the car had no license plate in front. They then followed the car briefly before stopping it on the main street of town.
*435 Both defendant and his companion, Don Henderson, got out and approached the officers. Schossow talked with Henderson, who identified himself, and Wetterlin talked with defendant, who, when asked to produce his license, said that it had been suspended. Asked where they were going, Henderson, who worked at the service station, said they were taking a tire to a truck down the street. The officers told Henderson that he was free to leave and Henderson left. The officers told defendant that they were going to issue citations for driving after revocation and for driving without displaying one of the two license plates, and they asked him if he would be willing to accompany them to the La Crescent Police Station, which is in Houston County about 3 miles south of Dresbach. Defendant agreed and also agreed to let Schossow drive his car to the station for him. On the way, Schossow stopped off at her car and got out her citation book. Defendant rode with Wetterlin.
At the station, Wetterlin told defendant that there were a couple of other things he would like to talk about but he first had to give defendant a Miranda warning. He then gave defendant a Miranda warning and obtained a waiver. In response to questions, defendant admitted to driving after revocation and said that the front license plate had come off when he ran into a dog. Wetterlin then told defendant what he knew about the burglary on the evening of the 13th and asked defendant some questions relating to it. Defendant first denied going to Baumgartner's house and then admitted it but denied taking anything. Wetterlin then left the room, and Schossow told defendant that she thought he had stolen the gun and that he should come clean. Defendant replied, "Well, I may as well," and proceeded to admit that he took the gun. Schossow then said that she had reason to believe defendant had used the gun in robbing the truckstop on the morning of the 14th. Wetterlin rejoined Schossow at that point, and they both questioned defendant further. During the questioning, defendant signed a consent form permitting the officers to search his car; and the officers also obtained the consent of defendant's father, the car's registered owner, who came to the station. After finding money in the car, the officers questioned defendant further, and defendant admitted that he committed the robbery. He also said that he had hidden the gun at the trailer house of his girlfriend. He consented to a search of his own trailer. The search of his girlfriend's trailer, to which she consented, resulted in the discovery of the gun. Defendant gave a written statement in his own handwriting, acknowledging in the statement that he had been advised of his rights and that his statement was freely and voluntarily given.
Defendant argues on appeal that trial court's refusal to suppress the confession and related evidence was prejudicial error.
(a) First, he argues that the confession was the product of an illegal arrest. Specifically, he argues that this case is similar to Dunaway v. New York, 442 U.S. 200, 99 S. Ct. 2248, 60 L. Ed. 2d 824 (1979), in which the Court ruled that the exclusionary rule required the suppression of a confession obtained after police, lacking probable cause to arrest, picked up a suspect for questioning, took him to headquarters, gave him a Miranda warning, and questioned him. The Court in Dunaway ruled that the application of the fourth amendment's requirement of probable cause does not depend on the nomenclature used to describe the police intrusion on the suspect's freedom of action. Thus, the mere facts that the suspect was not booked or told that he was under arrest and would not have had an arrest record if the questioning had proved fruitless were not alone determinative of the issue of whether in fact the suspect was under arrest at the time he was questioned. Concluding that the defendant was in fact arrested and that the arrest was illegal because of the lack of probable cause, the Court ruled that the trial court prejudicially erred in failing to suppress the confession.
*436 The ultimate test to be used in determining whether a suspect was under arrest is whether a reasonable person would have concluded, under the circumstances, that he was under arrest and not free to go. Florida v. Royer, 460 U.S. 491, 103 S. Ct. 1319, 75 L. Ed. 2d 229 (1983); United States v. Mendenhall, 446 U.S. 544, 100 S. Ct. 1870, 64 L. Ed. 2d 497 (1980); Dunaway v. New York, 442 U.S. 200, 99 S. Ct. 2248, 60 L. Ed. 2d 824 (1979); Oregon v. Mathiason, 429 U.S. 492, 97 S. Ct. 711, 50 L. Ed. 2d 714 (1977).
We need not decide whether defendant is correct in arguing that he was under arrest, because it is clear to us that, contrary to defendant's argument, the police had probable cause to arrest him. The fact of whether or not the officers subjectively felt they had probable cause does not foreclose the conclusion that they had objective probable cause. State v. Speak, 339 N.W.2d 741, 745 (Minn.1983). The officers knew that the burglary of the Baumgartner residence in Hokah occurred on the evening of March 13 and that the robbery of the truck stop in Nodine occurred several hours later, early on the 14th. They knew that a Remington 870 pump action shotgun and a pillowcase had been taken in the burglary and that a man wearing a pillowcase and armed with a Remington 870 pump action shotgun had committed the robbery. They knew that defendant lived in Dakota, 5 miles from the truck stop and 10 miles from Hokah; that he was a friend of Baumgartner and that he knew about Baumgartner's gun; that his car was seen outside Baumgartner's house late on the 13th, about the time the burglary was committed; that defendant had worked at the truckstop and therefore would have known about the unmarked cash drawer under the cash register; that defendant had been fired from the truckstop in January; and that defendant fit the general description of the robber. Bearing in mind that the standard is probable cause, not proof beyond a reasonable doubt, we conclude that the police had objective probable cause to believe that defendant committed the burglary and robbery.
(b) Defendant's next contention is that, although the police gave him a Miranda warning, they did not tell him specifically what they wanted to question him about and therefore his waiver was defective. If a Miranda warning is to be anything more than a meaningless ritual, it is of vital importance that a defendant's waiver of his right against compelled self-in-crimination and his right to counsel during custodial interrogation be knowing, intelligent and voluntary. Miranda v. Arizona, 384 U.S. 436, 475, 86 S. Ct. 1602, 1628, 16 L. Ed. 2d 694 (1966); Johnson v. Zerbst, 304 U.S. 458, 464, 58 S. Ct. 1019, 1023, 82 L. Ed. 1461 (1938). Whether or not the police have a duty to inform a suspect of the crime about which they intend to question him, and we surmised in dicta in State v. Ponte-Alfonzo, 348 N.W.2d 734, 735 (Minn. 1984) that they do not,[1] "[i]t is difficult to discern how a waiver of * * * rights could be knowing, intelligent and voluntary where the suspect is totally unaware of the offense upon which the questioning is based." United States v. McCrary, 643 F.2d 323, 328 (5th Cir.1981). There is no good reason why investigating officers should not make certain that the person they wish to question understands the nature of the charge or crime about which they wish to question him or her before that person is asked to waive fifth and sixth amendment rights. In the case before us, defendant was asked to accompany police officers in a police car to the LaCrescent Police Department for the purpose of "issuing a ticket for driving after revocation and for no front license plate." Once there, he was asked to waive his Miranda rights, whereupon officers questioned him first about the revocation of his license, then about the burglary, and then about the robbery. It is not clear that he was *437 free to leave, and we have already determined that the officers had probable cause to arrest him for a felony. There would be grave doubt that the defendant's Miranda waiver was valid, except that at the outset of the interrogation officers told defendant that they wanted to question him about other matters as well as about the revocation. Defendant was not "totally unaware" of the offenses upon which the questioning was based. There is nothing in the record, such as defendant's own testimony, indicating that he did not know what those other matters were. In fact, the officers told him that he was suspected of the burglary before they questioned him about it, though not before his waiver of rights, and he must have known that any incriminating statements he made with respect to the burglary would also aid the police in proving that he committed the robbery, about which they questioned him a short time later. We conclude, therefore, that defendant's waiver was valid, but we caution investigating officers to make clear to suspects at the time they are asked to waive their Miranda rights the nature of the crimes about which they will be questioned.
(c) Defendant's final contention is that his confession was rendered involuntary by the fact that he was told that any cooperation would be brought to the trial court's attention, by the fact that team interrogation techniques were used, and by the fact that defendant was without counsel. In State v. Anderson, 298 N.W.2d 63, 65 (Minn.1980), we held that a promise to a defendant that a female friend would be released from jail if he gave a written statement did not render his confession involuntary, stating:
It is true that a promise to free a relative in exchange for a confession may render a confession inadmissible. Police should avoid making promises of this kind in order to encourage a defendant to confess. However, courts do not mechanically hold confessions involuntary just because a promise has been involved. Rather, we must look to the totality of the circumstances, considering all the factors bearing on voluntariness. [Citations omitted.]
More recently, in State v. Jungbauer, 348 N.W.2d 344 (Minn.1984), we rejected a contention that the defendant's confession was improperly obtained by a promise to release him pending formal charging and to seek only his summons instead of an arrest warrant. Our opinion quoted the above excerpt from Anderson, as above, then added:
Police should not make promises, implied or expressed, in order to encourage a defendant to confess. However, as we said in Anderson, the making of a promise by police does not automatically render any confession obtained thereby involuntary. Rather, we must look to all the circumstances and consider all the factors bearing on voluntariness. Doing that, and bearing in mind that defendant had two prior felony convictions, that he had been advised of his rights and had previously exercised his right to silence, that he was not subjected to any kind of prolonged interrogation or threats; and that the promise was not the sort of promise that might tempt an innocent person to confess, we conclude that defendant's confession was voluntary.
348 N.W.2d at 346-47. Anderson and Jungbauer control. Defendant's confession in this case was not rendered involuntary by lack of counsel, team interrogation or the fact that he was encouraged to cooperate.
Affirmed.
NOTES
[1] There was both omnibus hearing testimony and trial testimony that Ponte-Alfonzo was told and knew why he was being questioned. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603453/ | 8 So. 3d 1018 (2008)
Deangelo THOMAS
v.
STATE of Alabama.
CR-07-0094.
Court of Criminal Appeals of Alabama.
September 26, 2008.
Edward D. Tumlin, Birmingham, for appellant.
Troy King, atty. gen., and Jean A. Therkelsen, asst. atty. gen., for appellee.
WELCH, Judge.
Deangelo Thomas was convicted of two counts of robbery in the first degree, a violation of § 13A-8-41, Ala.Code 1975, and one count of criminal use of a defense spray, a violation of § 13A-6-27, Ala.Code 1975. The trial court sentenced Thomas to two terms of life in prison without the possibility of parole for his robbery convictions and one term of life imprisonment for his conviction for criminal use of a defense spray. The terms are to run consecutively.
*1019 Thomas contends that he did not knowingly, intelligently and voluntarily waive his right to counsel, and that the trial court should not have let him represent himself without first warning him of the dangers of self-representation, as required by Faretta v. California, 422 U.S. 806, 95 S. Ct. 2525, 45 L. Ed. 2d 562 (1975). In response, the State contends that Thomas did not preserve the issue for appellate review.
The State's position is without merit. Deprivation of the right to counsel is a jurisdictional bar to a valid prosecution and, thus, it can be raised at any time. See Woodruff v. City of Pelham, 1 So. 3d 157, 159 (Ala.Crim.App.2008) (and cases cited therein).
In Baker v. State, 933 So. 2d 406, 408-09 (Ala.Crim.App.2005), this Court discussed the jurisdictional prerequisite as it relates to the issue of right to counsel as follows:
"`A defendant's decision to represent himself necessarily involves the waiver of his right to counsel. See Fitzpatrick v. Wainwright, 800 F.2d 1057, 1064 (1986). In Pratt v. State, 851 So. 2d 142, 144-45 (Ala.Crim.App.2002), this Court pointed out:
"`"`The constitutional "right to counsel, or waiver thereof, is an essential jurisdictional prerequisite to the authority to convict an accused[, and c]onviction without this safeguard is void." People v. Carroll, 140 Cal. App. 3d 135, 140, 189 Cal. Rptr. 327, 331 (Cal.App. 2 Dist.), cert. denied, 464 U.S. 820, 104 S. Ct. 83, 78 L. Ed. 2d 93 (1983) (citing Johnson v. Zerbst[, 304 U.S. 458, 58 S. Ct. 1019, 82 L. Ed. 1461 (1938)]). Unless a defendant has or waives assistance of counsel, the Sixth Amendment is a jurisdictional bar to a valid conviction and sentence. Johnson v. Zerbst; Stokes v. Singletary, 952 F.2d 1567 (11th Cir. 1992); Boruff v. United States, 310 F.2d 918 (5th Cir.1962). See also Lancaster v. State, [638 So. 2d 1370, 1373] (Ala.Crim.App.1993) ('the appellant's... right to have counsel appointed on appeal [is a] jurisdictional matter[ ]'); Lake v. City of Birmingham, 390 So. 2d 36, 38 (Ala.Crim.App. 1980) (a record failing to reveal any of the circumstances surrounding the appellant's self-representation "will not support the trial court's judgment wherein the appellant was sentenced to a loss of liberty").'
"`"Berry v. State, 630 So. 2d 127, 130 (Ala.Crim.App.1993) (footnote omitted). See also Custis v. United States, 511 U.S. 485, 494, 114 S. Ct. 1732, 128 L. Ed. 2d 517 (1994) (`"If the accused ... is not represented by counsel and has not competently and intelligently waived his constitutional right, the Sixth Amendment stands as a jurisdictional bar to a valid conviction and sentence depriving him of his life or his liberty.... The judgment of conviction pronounced by a court without jurisdiction is void, and one imprisoned thereunder may obtain release by habeas corpus."') (quoting Johnson v. Zerbst, 304 U.S. 458, 468, 58 S. Ct. 1019, 82 L. Ed. 1461 (1938)); Weakley v. State, 721 So. 2d 235, 236 (Ala.1998) (holding that the right to counsel at arraignment is a jurisdictional matter)."
"`Thus it is the lack of counsel, coupled with the absence of a knowing and intelligent waiver thereof, that acts to deny the defendant counsel and to jurisdictionally bar his prosecution.'"
The record in this case shows the following. After being told by Robert Sanford, Thomas's appointed counsel, that Thomas intended to represent himself, the following conversation took place:
*1020 "THE COURT: Is that correct, Mr. Thomas, that you want to represent yourself?
"DEFENDANT THOMAS: Yes, sir.
"THE COURT: And the other statements about the settlement offers that have been rejected, is that also correct?
"DEFENDANT THOMAS: Yes, sir.
"THE COURT: Let me say this. If you are going to represent yourselfand I will allow you to do thatI am going to order that Mr. Sanford sit at the table. He won't be trying the case. But there may be something that comes up during the case where you need to ask a procedure question, and he would be there to answer that question for you if you needed advice.
"I say that for this reason. During the course of a trial, there are certain procedural rules that all of the lawyers have to follow when they try a case. And you would still be bound by those rules.
"DEFENDANT THOMAS: I would like to speak something for the record too. "THE COURT: Let me finish though, and then I will let you do that.
"In following those rules, if you go outside the rules and there is an objection, then I would have to stop you from whatever you were doing. And I don't know what that might be.
"When we start a case, we bring a bunch of jurors up here. And then the lawyers typically will ask the jury questions before the actual jurors that are seated in this box are selected. That is to help you with the strikes. You would excuse so many people to leave a panel in the box.
"Now, many times when I have a defendant that represents himself, they sometimes want the lawyer to ask the jurors the questions, but then they make the decision about who gets struck and who stays. Do you see what I am saying? And that is another reason he is staying here.
"But you don't have to let him ask those questions. You can ask the questions that touch on their qualifications to serve and touch on whether they might be prejudiced against you based on their life experiences.
"All of this is geared to try to get a jury that is going to be fair to you and fair to the State. We don't want anybody coming in here that is ready to convict you just because you are here. And we don't want somebody that will just discount what the State says totally just because they are the prosecution.
"We want somebody that will listen to both sides and then make a fair decision. That is what all of this is geared toward. "So he will be in the courtroom if you have a question for him. That doesn't mean you have to ask him anything. But if you have a question, he is there. "Now, if there is an objection, if the State objects to something, then if you are asking questions, you should stop for a minute and let me rule on that objection. That is part of the normal procedure.
"And I mentioned to you yesterday when we were deciding if you were going to trial or not, since you are representing yourself, I know you can't afford to cause any real disruptions in the courtroom that would hurt your case. "If you are hoping to try the case and keep the jury as fair minded as possible, you wouldn't want to disrupt the proceedings. You want them to hear what you have to say and what the State has to say and cross-examination that you are allowed to conduct with any witness that they produce.
"I do want to sayand this applies to any lawyer, not just you handling your caseif there is a disruption in the *1021 courtroom, then I am going to have you removed from the courtroom and then Bob Sanford will try the rest of the case. Do you know what I mean?
"If I give you an instruction not to do something and you do it anyway, then you may forfeitand I make the decision at the time; I am not making it right nowyou might forfeit your right to stay in the courtroom, depending on what it is.
"So I hope that you will conduct yourself professionally and in an orderly manner in order to convey to the jury the best possible scenario of the fact that you feel like you are not guilty of these charges. "Now, you said you had something you wanted to say. You can stay right there.
"DEFENDANT THOMAS: Yeah. I want this on the record.
"THE COURT: Yes. She can hear you. "DEFENDANT THOMAS: On 09/24/07 before Judge Alfred Bahakel, I, the defendant, Deangelo Thomas, did dismiss my attorney, Robert Sanford, from representing me, the defendant, in this case for the purpose of neglected, ineffective and lack of care in this serious trial procedure.
"I, defendant, Deangelo Thomas, do make this open court motion to continue this procedure on the grounds that I am not a lawyer to represent myself in this serious matter.
"I thank you for allowing me to stand before this Honorable Court. That is what I want on the record."
(R. 14-15.) The trial court then denied Thomas's motion to continue.
We recognize that Thomas first answered affirmatively when asked by the trial court whether he wanted to represent himself. However, although his statement for the record was not the most eloquent or artfully crafted, it appears that Thomas was requesting a continuance so that another attorney could represent him in the trial of this case because he was dissatisfied with Sanford. Because of the apparent conflict in Thomas's statement, the onus was on the trial court to ensure that Thomas's waiver of counsel was knowingly and intelligently made.
"`"The constitutional right of an accused to be represented by counsel invokes, of itself, the protection of a trial court, in which the accusedwhose life or liberty is at stakeis without counsel. This protecting duty imposes the serious and weighty responsibility upon the trial judge of determining whether there is an intelligent and competent waiver by the accused. While an accused may waive the right to counsel, whether there is a proper waiver should be clearly determined by the trial court, and it would be fitting and appropriate for that determination to appear upon the record."
"`Johnson v. Zerbst, 304 U.S. 458, 465, 58 S. Ct. 1019, 82 L. Ed. 1461 (1938).'"
Baker v. State, 933 So. 2d 406, 409 (Ala. Crim.App.2005).
"Rule 6.1(b), Ala. R.Crim. P., provides a framework to ensure that a defendant's waiver of counsel is knowing and intelligent. The rule provides in pertinent part as follows:
"`A defendant may waive his or her right to counsel in writing or on the record, after the court has ascertained that the defendant knowingly, intelligently, and voluntarily desires to forgo that right. At the time of accepting a defendant's waiver of the right to counsel, the court shall inform the defendant that the waiver may be withdrawn and counsel appointed or retained at any stage of the proceedings....'
"In addition to Rule 6.1, Alabama caselaw has discussed the duties of the *1022 trial court throughout criminal proceedings to ensure that a defendant fully understands his right to counsel and the consequences of waiving that right.
"`"In Faretta v. California, 422 U.S. 806, 95 S. Ct. 2525, 45 L. Ed. 2d 562 (1975), the Supreme Court held that a defendant has a Sixth Amendment right to represent himself in a criminal case. In order to conduct his own defense, the defendant must `knowingly' and `intelligently' waive his right to counsel, because in representing himself he is relinquishing many of the benefits associated with the right to counsel. Faretta, 422 U.S. at 835. The defendant `should be made aware of the dangers and disadvantages of self-representation, so that the record will establish that "he knows what he is doing and his choice is made with eyes open."' Faretta, 422 U.S. at 835 (other citations omitted)."'
"Baker v. State, 933 So. 2d 406, 408-411 (Ala.Crim.App.2005)."
Woodruff, 1 So.3d at 160.
This case is factually similar to Cobble v. State, 710 So. 2d 539 (Ala.Crim.App.1998), in which the defendant expressed dissatisfaction with his appointed counsel and fired her just before trial. The trial court permitted counsel to withdraw, even after finding that Cobble's complaints about his attorney were unfounded and unsubstantiated. However, the trial court also ordered appointed counsel to be in the courtroom to assist Cobble if needed during the trial of his case. The day of trial, Cobble requested a continuance to obtain counsel to represent him at trial, but the trial court determined that Cobble had waived his right to counsel and required him to represent himself at trial. This Court reversed the trial court's order, holding as follows:
"`"A waiver of counsel can only be `effectuated when the defendant asserts a clear and unequivocal' right to self-representation." Westmoreland v. City of Hartselle, 500 So. 2d 1327, 1328 (Ala.Crim.App.1986), citing Faretta, 422 U.S. 806, 95 S. Ct. 2525, 45 L. Ed. 2d 562. If the record is not clear as to the defendant's waiver and request of self-representation, the burden of proof is on the State. Carnley [v. Cochran], 369 U.S. [506] at 517, 82 S.Ct. [884] at 890-91, [8 L. Ed. 2d 70 (1962)]. Presuming a waiver from a silent record is impermissible. Carnley.'
"Tomlin [v. State], 601 So.2d [124] at 128 [(Ala.1991)] (emphasis added); see also Stanley v. State, 703 So. 2d 1027 (Ala.Crim.App.1997). In determining whether a defendant knowingly and intelligently waived his right to counsel, this court must look to the `totality of the circumstances' in each particular case. Tomlin, 601 So.2d at 129.
"In the instant case, the record does not show that the appellant made a `clear and unequivocal' waiver of his right to counsel. In fact, the record reveals that the trial court informed the appellant that he would be representing himself, even after the appellant asked the trial court to appoint another attorney to represent him. The appellant never expressed a desire to represent himself at trial.
". . . .
"Although we do not necessarily disagree with the trial court's findings that the appellant was engaging in dilatory tactics by making unwarranted accusations against his trial counsel, we cannot uphold the trial court's peremptory ruling that the appellant, as a result of these actions, knowingly waived his right to trial counsel. In Leslie v. State, 703 So. 2d 1029 (Ala.Crim.App.1997); Stanley, supra, 703 So.2d at 1028; and Watkins v. State, 708 So. 2d 236 (Ala. *1023 Crim.App.1997), three cases recently decided by this court which were factually similar to the instant case, we held that the trial court, instead of requiring the defendant to represent himself at trial, should have done one of the following: (1) denied the attorney's motion to withdraw; (2) appointed a new attorney to represent the defendant at trial; (3) granted the defendant's request for a continuance to allow him to retain counsel; or (4) determined whether the defendant wanted to represent himself and, if so, engaged the defendant in a colloquy to determine whether he understood all of the implications involved in self-representation. Any of the above actions would have been appropriate here; requiring the appellant to represent himself was not."
Cobble v. State, 710 So. 2d 539, 541-42 (Ala. Crim.App.1998).
Likewise, in this case the record does not show that Thomas made a clear and unequivocal waiver of his right to counsel. There is no evidence in the record indicating that the trial court attempted to clarify Thomas's conflicting statements that he intended to represent himself but then he requested a continuance because he was not a lawyer and appeared to want an attorney to represent him in the trial of this case. The record does not affirmatively indicate that Thomas made a knowing, intelligent waiver of his right to counsel.
Even if we were to find that the record in this case supported a finding that Thomas knowingly and intelligently waived his right to counsel, the record does not indicate that the trial court properly advised him of the dangers and disadvantages of self-representation, and it did not advise him that he could revoke his waiver at any time during the proceedings. See Williams v. State, 958 So. 2d 911, 913 (Ala. Crim.App.2006), and Leonard v. State, 484 So. 2d 1185 (Ala.Crim.App.1985).
An argument might be made that the trial court's admonitions to Thomas that he abide by the trial court's rulings on objections and that he conduct himself in a professional manner or he would face possible expulsion from the courtroom were attempts to apprise Thomas of the dangers and disadvantages of self-representation. However, in viewing the totality of the circumstances concerning the trial court's determination that Thomas would represent himself, we find that the trial court's statement to Thomas was more in the nature of how the trial court expected him to comport himself rather than an effort to apprise him of the dangers and disadvantages of self-representation. Similarly, the trial court failed to advise Thomas that he could revoke his waiver of counsel at any time.
For the reasons set forth above, we must reverse the trial court's judgment and remand this case for a new trial. See Farid v. State, 720 So. 2d 998 (Ala.Crim. App.1998); Hairgrove v. State, 680 So. 2d 946 (Ala.Crim.App.1995); Williams, supra; and Cobble, supra.
REVERSED AND REMANDED.
BASCHAB, P.J., and McMILLAN and WISE, JJ., concur. SHAW, J., concurs in the result. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603459/ | 354 N.W.2d 1 (1984)
STATE of Minnesota, Respondent,
v.
Thomas J. BOUWMAN, Appellant.
No. C8-83-651.
Supreme Court of Minnesota.
August 17, 1984.
*2 C. Paul Jones Public Defender, Kathy King, Asst. Public Defender, Minneapolis, for appellant.
Hubert H. Humphrey, III, Atty. Gen., St. Paul, Thomas Johnson, Hennepin County Atty., Minneapolis, for respondent.
Considered and decided by the court en banc.
AMDAHL, Chief Justice.
Thomas Bouwman was convicted of two counts of second-degree murder in the brutal stabbing deaths of Bouwman's parents-in-law, Marvin and Pearl Isaacson. A Hennepin County District Court found Bouwman guilty on both counts of second-degree murder at the conclusion of a trial to the court on January 26, 1983. Bouwman raises the following three issues on appeal:
1. Whether Bouwman proved by a preponderance of the evidence that he was so mentally ill that he did not know the nature of his acts or was unable to distinguish right from wrong.
2. Whether the district court's comments at the close of the state's case constituted an acquittal.
3. Whether Bouwman was denied due process because of his absence from the in-chambers discussion of the motion for acquittal.
A brief recitation of the facts is necessary prior to addressing the substantive issues.
In late March 1981, Bouwman, with his employer's urging, admitted himself to the psychiatric unit at St. Mary's Hospital in Minneapolis. He suffered severe depression; for several months previous to his admission he had been attempting to locate or communicate with his estranged wife, Midge. His initial admission diagnosis was psychotic depression. Bouwman's frustration with the state of his marriage had led to his depression.
For almost 5 weeks, he was treated with the antipsychotic drug Thorazene. In mid-April, a Minnesota Multiphasic Personality Inventory (MMPI) test indicated that Bouwman's psychosis had been "resolved." Whether the psychosis was eliminated by drug treatment or counseling is not clear.
*3 In late April, his treatment with Thorazene was discontinued. Notwithstanding the absence of psychotic symptoms in his recent MMPI, Bouwman's treating psychiatrist, Dr. Joseph Gendron, testified that Thorazene did not seem to be alleviating his depression. Consequently, Bouwman was placed on Ascendin, an antidepressant drug, to help "get a better energy perspective in balance." In addition, Bouwman was transferred from the psychiatric ward to the chemical dependency unit. Bouwman had a long history of alcohol and drug abuse. Dr. Gendron testified that Bouwman had benefited as much as possible in the psychiatric ward and that the chemical dependency unit was an alternative avenue of treatment.
At approximately 9 a.m. on May 1, 1981, Bouwman left the chemical dependency unit at St. Mary's feeling hopeless and intending to commit suicide by jumping off the Washington Avenue bridge. After wandering around for a period of time, he decided that he should commit suicide in a way that would attract Midge's attention. He called a cab to take him to a Target store where he could cash a check to buy some alcohol; he also bought a knife which he planned to plunge into his heart. At some point between his wanderings and his trip to Target, Bouwman decided to go to the Isaacson home to kill himself. Bouwman's relationship with his parents-in-law was strained because of his continuous phone calls inquiring about Midge's whereabouts.
After consuming 1 pint of alcohol, and starting a second, Bouwman arrived at the Isaacson home at 4428 Lyndale. He sat on the front porch for a while. Afraid that a neighbor would see him and prevent his suicide attempt, he walked to the back steps and continued to drink a second pint of alcohol. His obsession with his wife led Bouwman to the decision that he should attempt to get in touch with her once more. He saw an unlocked basement window and decided to enter the Isaacson home. Prior to entering through the window, he cut the phone line to prevent the Isaacsons from calling the police or St. Mary's.
Midge's dog Satin was in the basement of the Isaacson home and he brought the dog upstairs with him. Bouwman claims that he did not intend to harm the Isaacsons when he entered their home. He encountered Marvin Isaacson first. He demanded that Isaacson give him straight answers to his questions about Midge and also admitted that he knew he didn't belong in the Isaacson home but had to "get to the bottom of [it] all." Bouwman and Marvin Isaacson went upstairs and encountered an angry Pearl Isaacson. Bouwman then cut a second phone line to prevent her from calling the police.
Eventually Bouwman and the Isaacsons went downstairs to the kitchen to drink coffee and talk. After an emotional conversation and the realization that self-pity was not productive, he demanded answers to his questions. He placed the knife at the dog's throat, threatening to kill the dog if his questions were not answered. Marvin Isaacson responded to the threat by throwing a cup of scalding hot coffee in Bouwman's face. Bouwman went into a rage, stabbing and lashing out and does not remember much more about the incident.
Before leaving the Isaacson home, Bouwman attempted to sexually assault Pearl Isaacson but managed only to place his finger in her vagina. He then rummaged about the house looking for clues of Midge's whereabouts.
Shortly afterwards, he appeared at Midge's sister, Holly Kivin's doorstep with Satin, demanding Midge's phone number. Holly and her ex-husband Larry called the police informing them that Bouwman should be in St. Mary's. Lieutenant Keith Davidson arrived 5 minutes later; Officers Hackenmueller and Polus came to the scene minutes after Davidson arrived. After the dog was wrested away from Bouwman's grasp, Bouwman was placed in Davidson's squad car and he informed Davidson that "You have to come with me. I know where two people are dead." Davidson asked Bouwman why there were *4 two dead people and he responded "They lied to me; they lied to me."
Davidson informed Hackenmueller and Polus of his conversation with Bouwman and both squads proceeded to 4428 Lyndale where the bodies of Marvin and Pearl Isaacson were discovered. The Isaacsons had been stabbed eight to ten times each and died of massive internal bleeding.
Police investigators were called to the scene and Bouwman was given his Miranda rights and placed under arrest for murder. Hackenmueller and Polus transported Bouwman to Hennepin County Medical Center for treatment of Bouwman's cut hand.
1. The district court found Bouwman guilty of second-degree murder and ruled that he was not excused by reason of insanity. In insanity defense cases, we have held that "[s]ubstantial deference is accorded the jury's evaluation of the testimony on mental illness, and we have often said that the jury is the sole judge of the believability and weight of the testimony." State v. Linder, 304 N.W.2d 902, 907 (Minn.1981), citing State v. Larson, 281 N.W.2d 481, 487 (Minn.1979). See also State v. Hoskins, 292 Minn. 111, 137-38, 193 N.W.2d 802, 819 (1972). Bouwman waived his right to a jury trial and consequently the district court was also the fact-finder. See Minn.R.Crim.P. 26.01, subd. 1(2) (1983). "It is well established that the findings of the trial court, after waiver of a jury trial by a defendant, are entitled to the same weight as a jury verdict." State v. Crosby, 277 Minn. 22, 24, 151 N.W.2d 297, 299 (1967) (citations omitted). See State v. Cox, 278 N.W.2d 62, 65 (Minn.1979). Cf. United States v. Niver, 689 F.2d 520, 529 (5th Cir.1982) (test is whether evidence is sufficient to justify trial judge's conclusion that defendant was guilty beyond a reasonable doubt (citations omitted)). Hence, we must review the evidence concerning whether Bouwman was insane under Minn. Stat. § 611.026 (1982) in the light most favorable to the verdict. State v. Dodis, 314 N.W.2d 233, 237 (Minn.1982). See State v. McCullum, 289 N.W.2d 89, 91 (Minn.1979); State v. Oevering, 268 N.W.2d 68, 71 (Minn.1978).
Minn.Stat. § 611.026 (1982) codifies the M'Naughton Rule in Minnesota:
No person shall be tried, sentenced, or punished for any crime while mentally ill or mentally deficient so as to be incapable of understanding the proceedings or making a defense; but he shall not be excused from criminal liability except upon proof that at the time of committing the alleged criminal act he was laboring under such a defect of reason, from one of these causes, as not to know the nature of his act or that it was wrong.
The law presumes sanity, State v. Larson, 281 N.W.2d 481, 483, 486 (Minn.1979), and any defendant asserting the defense bears the burden of proving insanity by a preponderance of the evidence. State v. Linder, 304 N.W.2d at 907; State v. Bott, 310 Minn. 331, 335, 246 N.W.2d 48, 52 (1976).
Two psychiatrists, Dr. Carl Schwartz and Dr. Charles McCafferty, testified that Bouwman "was laboring under such a defect of reason * * * as not to know the nature of his act, or that it was wrong." Minn.Stat. § 611.026 (1982). Dr. Joseph Gendron, Bouwman's treating psychiatrist, testified that he was not psychotic under the guidelines of the Diagnostic and Statistical Manual of Mental Disorders[1] and that he "did know right from wrong," could "exercise volition and choice" and had the "capacity to act purposefully." In addition, Gendron testified that he saw Bouwman shortly before he left the hospital and that he was not psychotic at that time. The state also introduced, as evidence, a report by Dr. Malmquist. Malmquist agreed with Gendron's appraisal of Bouwman that he was not psychotic and that his chief problem was his chemical dependency and paranoid personality. In addition, *5 Malmquist did not find him insane under the M'Naughton standard.
Although defense counsel attempted to impeach Gendron during cross-examination with respect to his opinion of Bouwman's capacity to form specific intent, the trial court evidently found the opinions of Gendron and Malmquist more persuasive. The trial court's conclusion that appellant was not M'Naughton insane is supported by substantial evidence and in light of the deference accorded a finding of fact on this issue, see Linder, 304 N.W.2d at 907, the trial court is affirmed.
2. The state presented its entire case relating to the initial phase of a Hoffman unitary trial[2] on January 11, 1982. On January 25, 1982, the trial resumed and the attorneys conferenced with the district court judge in chambers before the defense presented its case. During this conference the following exchange took place:
THE COURT: It has occurred to me as I have been reviewing the evidence in this case over the last couple of days that if the case were submitted to me with no further evidence I would not find guilt beyond a reasonable doubt of 2nd degree Murder on either case. The most I could find would be 1st degree Manslaughter.
My moral question has been whether I could properly raise this to counsel, A, or, B., whether I had a duty to raise it. I decided I would have no duty, but I would not be out of line raising it because this is a Court case.
I will tell you right now, there is no way, unless evidence comes in through testimony of the defendant or by admission through the psychiatrists, through testimony of a psychiatrist, that he can be convicted of Murder, in my judgment.
Defense counsel informed the court that he planned to move for a judgment of acquittal pursuant to Minn.R.Crim.P. 26.03, subd. 17 (1983). The court then suggested that appellant's counsel consider pleading to manslaughter one pursuant to Rule 15.07 of the Rules of Criminal Procedure.
Appellant's counsel responded "[i]f you were going to rule that at this point the State has proved no more than Murder in the 2nd Degree, I was going to put Tom [appellant] on. If you ruled and agreed with me that he hadn't the State hasn't proved anything greater than Manslaughter in the 1st degree, I was simply going to rest, present no evidence." The court stated that it could draw equal inferences of 2nd degree murder or 1st degree manslaughter and that under the circumstantial evidence rule then the inference most favorable to the accused must be drawn. Defense counsel then formally moved for acquittal on first-, second-, or third-degree murder.
The court's response to this motion was as follows:
THE COURT: It's the Court's opinion that Rule 26.03, Subdivision 17, the first paragraph thereof, does not apply to lesser included offenses in that the motion would be appropriate if the evidence were insufficient to sustain a conviction of the offense or a lesser included offense. Now, admittedly that interpretation reads additional words into the Rule. The draftors' comments are not enlightening on this subject.
The Court before granting such a motion would have to be satisfied that it would be appropriate in the face of the State's continuing ability to prove a prima facie case of a lesser included offense.
Therefore, the motion is denied without prejudice, the Court being aware that the State at this point in the Court's judgment has not proved a prima facie case of Murder in the 1st degree, has not proved a prima facie case of Murder in the 2nd degree, or Murder in the 3rd degree, but has proved a prima facie case of Manslaughter in the 1st degree as to *6 each victim. However, procedurally, the motion is denied without prejudice.
Two hours later, the district court qualified its earlier ruling, stating:
THE COURT: In connection with the ruling which I made on the motion for judgment of acquittal, I have considered the motion in the light of the Rules of Criminal Procedure, as I understand them. I read Rule 26.03, Subdivision 17(1) to include lesser included offenses in the requirement that the evidence not be sufficient to sustain a conviction.
Therefore, the motion for judgment of acquittal is granted as to 1st degree Murder, denied as to 2nd degree Murder, and 1st degree Manslaughter.
I am satisfied that the evidence at this stage produced by the State would contain [sic] a conviction for either 2nd degree Murder, or 1st degree Manslaughter. Although the jury, were there a jury, would be instructed that as to the circumstantial evidence upon which this case rests, it would be required to adopt the inference most favorable to the defendant if the evidence equally supports two or more inferences.
Bouwman argues that the district court's initial ruling that the state could not prove murder constituted an acquittal for purposes of Rule 26.03, subd. 17(1), (2) of the Rules of Criminal Procedure and the Double Jeopardy Clause of the United States Constitution.[3]
Minnesota Rules of Criminal Procedure 26.03, subd. 17(1) (1983), provides in pertinent part as follows:
After the evidence on either side is closed, the court on motion of a defendant or on its own motion shall order the entry of a judgment of acquittal * * * if the evidence is insufficient to sustain a conviction * * *.
(Emphasis added.) Part 2 of subdivision 17 prohibits the trial court from reserving its decision on the motion, if the motion is made at the close of the prosecutor's case. Minn.R.Crim.P. 26.03, subd. 17(2).
Rule 26.03, subd. 17(1), is nearly identical to Federal Rule of Criminal Procedure 29(a) and federal courts have construed Rule 29(a)'s requirements as mandatory.[4]See Burks v. United States, 437 U.S. 1, 11 n. 5, 98 S. Ct. 2141, 2147 n. 5, 57 L. Ed. 2d 1 (1978); United States v. Brown, 456 F.2d 293, 294 (2nd Cir.), cert. denied, 407 U.S. 910, 92 S. Ct. 2436, 32 L. Ed. 2d 684 (1972). The mandatory nature of Rule 29(a) reflects the principle that "the prosecution must establish a prima facie case by its own evidence before the defendant may be put to his defense." United States v. Hinderman, 625 F.2d 994, 996 (10th Cir. 1980), quoting Cephus v. United States, 324 F.2d 893, 895 (D.C.Cir.1963). Consequently, if the district court's initial gratuitous comments are construed as a determination or ruling that the state had not *7 proved the prima facie elements of murder one, two, or three, then under the federal interpretation of Rule 29(a) acquittal of appellant was mandatory. In addition, if the court's "without prejudice" language is construed as a reservation of his ruling on the motion, then Rule 26.03, subd. 17(1), has not been complied with and the court's action constitutes acquittal. See United States v. Conway, 632 F.2d 641, 643 (5th Cir.1980).[5] Failure to rule on the motion is not considered prejudicial if the prosecution's case is sufficient to go to the jury. See id.; see also United States v. Dreitzler, 577 F.2d 539, 551-52 (9th Cir.1978).
The attachment of jeopardy in a court trial occurs upon the swearing of the first witness. State v. Abraham, 335 N.W.2d 745, 748 (Minn.1983), citing Christ v. Bretz, 437 U.S. 28, 98 S. Ct. 2156, 57 L. Ed. 2d 24 (1978). Subsequent proceedings resulting in conviction after a trial court's ruling on the question of defendant's factual innocence violate the double jeopardy clause. See United States v. Martin Linen Supply Co., 430 U.S. 564, 571, 97 S. Ct. 1349, 1354, 51 L. Ed. 2d 642 (1977). Thus, it is necessary to determine the nature of the district court's comments and to determine their double jeopardy consequences, if any.
"[I]n determining whether a ruling by the trial court constitutes a judgment of acquittal, the trial court's characterization of its own action is not controlling." State v. Abraham, 335 N.W.2d 745, 748 (Minn. 1983). Accord United States v. Martin Linen Supply Co., 430 U.S. 564, 571, 97 S. Ct. 1349, 1354, 51 L. Ed. 2d 642 (1977) ("we must determine whether the ruling of the judge, whatever its label, actually represents a resolution, correct or not, of some or all of the factual elements of the offense charged"). In this case, the district court made a formal ruling on the motion when he granted it with respect to first-degree murder. The district court's preceding comments, although gratuitous and impolitic, appear to be a verbalization of his thought process as he weighed the evidence they have no binding legal effect.
In United States v. Miles, 401 F.2d 65 (7th Cir.1968), the Seventh Circuit reviewed similar comments made by the trial court:
The Court: I still have problems with whether or not the government has proved an aider and abettor case. This is quite another matter, but I don't have the problems on the basis of her testimony. * * *
Mr. Murray: I would say, look, the supervisor is coming, let's get back to work because whether he is a hard worker or not, I don't want to see him get fired. I mean the evidence in this case is susceptible to a multitude of interpretations.
The Court: Mr. Murray, it is certainly susceptible of two interpretations, one of innocence and one of guilt, but not equally, not close.
Mr. Murray: It doesn't have to be.
The Court: It has to be sufficiently susceptible of innocence so that you cannot find the defendant guilty beyond a reasonable doubt.
401 F.2d at 67. On appeal the defendant contended that the court expressed reasonable doubt and therefore should have entered a judgment of acquittal. The Seventh Circuit upheld the conviction:
The court as the trier of fact, in this case, must use its experience with people and events, weighing the probabilities presented by the evidence. Thus, assuming that in reaching its decision the court has "problems" with the evidence, its judgment reflects a weighing of all the evidence. If, by its judgment, the court is convinced beyond a reasonable doubt, we can require no more. Holland v. United States, 348 U.S. 121, 140, 75 S. Ct. 127 [138], 99 L. Ed. 150 (1954). Moreover, *8 it is not the province of the Court of Appeals to retry the case, weigh the evidence or determine the credibility of witnesses. Glasser v. United States, 315 U.S. 60, 80, 62 S. Ct. 457 [469], 86 L. Ed. 680 (1942).
Id.
In the instant case, as in Miles, the district court's formal ruling on the motion occurred when it granted the Rule 26.03, subd. 17(1), motion for first-degree murder and denied the motion for all lesser included offenses. The subsequent proceedings did not violate the double jeopardy clause.
3. Bouwman alleges that he was denied his sixth amendment right to a fair trial as a result of his absence from the in-chambers conference concerning the acquittal motion. Bouwman's attorney was present during these discussions but a defendant has a right to be personally present at every critical stage of his trial.[6]State v. Grey, 256 N.W.2d 74, 76 (Minn. 1977). See Illinois v. Allen, 397 U.S. 337, 338, 90 S. Ct. 1057, 1058, 25 L. Ed. 2d 353 (1970). Notwithstanding the generally broad interpretation accorded the right-to-be-present rule, we hold Bouwman's absence from the in-chambers conversation to be harmless error.
Traditionally, courts have held the defendant's absence from critical stages of his trial to merit automatic reversal. See, e.g., Shaw v. State, 282 A.2d 608, (Del. 1971); Deans v. State, 180 So. 2d 178, 180 (Fla.App.1965); People v. Medcoff, 344 Mich. 108, 117, 73 N.W.2d 537, 543-44, (1955). See also Lewis v. United States, 146 U.S. 370, 13 S. Ct. 136, 36 L. Ed. 1011 (1892); Hopt v. Utah, 110 U.S. 574, 4 S. Ct. 202, 28 L. Ed. 262 (1884). More specifically, defendants "have the right to be personally present at every stage of the trial where their substantial rights may be affected by the proceedings and where their presence relates to the fullness of their opportunity to defend against the charge." Medcoff, 344 Mich. at 115, 73 N.W.2d at 542. Under this rule injury was presumed. Id. at 117-18, 73 N.W.2d at 543. The traditional rule, however, has undergone considerable evolution since the United States Supreme Court recognized that even violations of constitutional rights may amount to harmless error when all of the facts and circumstances of a particular case are considered. See Chapman v. California, 386 U.S. 18, 22, 87 S. Ct. 824, 827, 17 L. Ed. 2d 705 (1967). Accord People v. Hayes, 126 Mich.App. 721, 337 N.W.2d 905, 909 (1983); State v. Howard, 324 N.W.2d 216, 222 (Minn.1982). Cf. State ex rel. Kons v. Tahash, 281 Minn. 467, 475 n. 3, 161 N.W.2d 826, 832 n. 3, cert. denied, 394 U.S. 961, 89 S. Ct. 1304, 22 L. Ed. 2d 562 (1969) (not every denial of constitutional right is prejudicial). Consequently, we must determine whether Bouwman's absence from the in-chambers conference was harmless error.
Under the harmless error rule we "must be able to declare a belief that it [the alleged error] was harmless beyond a reasonable doubt."[7]Chapman, 386 U.S. at 24, 87 S.Ct. at 828. The alleged error is not considered in isolation. State v. Howard, 324 N.W.2d 216, 222 (Minn.1982). See Harryman v. Estelle, 616 F.2d 870, 876 (5th Cir.1980). In the instant case, the evidence of Bouwman's guilt is overwhelming and we are satisfied that his absence from the in-chambers conference did not prejudice his case. Further support for this holding is provided by the numerous cases that provide that the right of the defendant to be present does not extend to *9 in-chambers arguments on questions of law. See e.g., United States v. Provenzano, 620 F.2d 985 (3rd Cir.), cert. denied, 449 U.S. 899, 101 S. Ct. 267, 66 L. Ed. 2d 129 (1980); People v. Jackson, 28 Cal. 3d 264, 168 Cal. Rptr. 603, 618 P.2d 149 (1980), cert. denied, sub nom. Jackson v. California, 450 U.S. 1035, 101 S. Ct. 1750, 68 L. Ed. 2d 232 (1981); Dobbs v. State, 245 Ga. 208, 264 S.E.2d 18, cert. denied, sub nom. Dobbs v. Georgia, 446 U.S. 913, 100 S. Ct. 1845, 64 L. Ed. 2d 267 (1980).
Bouwman also urges us to reconsider our decision in State v. Bouwman, 328 N.W.2d 703 (Minn.1982) (hereinafter cited as Bouwman I).[8] In Bouwman I, we rejected the doctrine of diminished responsibility by precluding the introduction of psychiatric testimony relating to a defendant's ability to formulate specific intent. Together with State v. Hoffman, 328 N.W.2d 709 (Minn.1982), Bouwman I prescribes the type of evidence admissible concerning mens rea and the order in which this evidence must be presented.
Bouwman I does not impinge upon a defendant's right to introduce evidence concerning voluntary intoxication under Minn.Stat. § 609.075 (1982)[9] but simply recognizes that under Minnesota law a defendant is either sane or insane and that psychiatric evidence is admissible only for purposes of establishing insanity under Minn.Stat. § 611.026 (1982). Psychiatric evidence is not admissible under Bouwman I to prove a reduced ability to formulate specific intent that is something less than insanity, i.e., there is no diminished responsibility type of insanity. Minnesota criminal law does not recognize gradations along a continuum of sanity that lessen a defendant's culpability.
Affirmed.
NOTES
[1] Frequently referred to as DSM-III, this manual is a recognized compendium of psychiatric disorders and their accompanying symptoms, American Psychiatric Association, Diagnostic and Statistical Manual of Mental Disorders, (3rd ed. 1980).
[2] See State v. Hoffman, 328 N.W.2d 709, 716-17 (Minn.1982). Rule 20.02, subd. 6(2) of the Minnesota Rules of Criminal Procedure (effective August 1, 1983) now, however, mandates a bifurcated trial when a defendant relies on a defense of not guilty and of mental illness or mental deficiency.
[3] "[N]or shall any person be subject for the same offense to be twice put in jeopardy of life or limb;". U.S. Const. amend V. In Benton v. Maryland, 395 U.S. 784, 89 S. Ct. 2056, 23 L. Ed. 2d 707 (1969), the United States Supreme Court held that the prohibition against double jeopardy applied to the states.
The underlying idea, one that is deeply ingrained in at least the Anglo-American system of jurisprudence, is that the State with all its resources and power should not be allowed to make repeated attempts to convict an individual for an alleged offense, thereby subjecting him to embarrassment, expense and ordeal and compelling him to live in a continuing state of anxiety and insecurity, as well as enhancing the possibility that even though innocent he may be found guilty.
Benton v. Maryland, 395 U.S. at 795-96, 89 S.Ct. at 2062-63, quoting Green v. United States, 355 U.S. 184, 187-88, 78 S. Ct. 221, 223-24, 2 L. Ed. 2d 199 (1957).
Bouwman argues that if the trial court's comments are construed as an acquittal, then further proceedings violated the double jeopardy clause.
[4] court on motion of a defendant or of its own motion shall order the entry of judgment of acquittal of one or more offense charged in the indictment or information after the evidence on either side is closed if the evidence is insufficient to sustain a conviction of such offense or offenses. If a defendant's motion for judgment of acquittal at the close of the evidence offered by the government is not granted, the defendant may offer evidence without having reserved the right.
Fed.R.Crim.P. 29(a).
[5] reservation to a defendant of the right to offer testimony after the denial of a motion for acquittal made at the close of the Government's case would be a futile thing if the court could reserve its ruling and force the defendant to an election between resting and being deprived of the benefit of the motion.
Jackson v. United States, 250 F.2d 897, 901 (5th Cir.1958).
[6] This right evolved out of the common law right of an accused to a jury trial. See People v. Medcoff, 344 Mich. 108, 73 N.W.2d 537 (1955). See generally, 3 C. Torcia, Wharton's Criminal Procedure §§ 479-84. (12th ed. 1975). In most courts, the right to be present is mandated by the rules of criminal procedure. See Rule 43, Fed.R.Crim.P.; Rule 26.03, subd. 1, Minn.R. Crim.P.
[7] The harmless error rule is also codified at Minn.R.Crim.P. 31.01 which provides as follows:
Any error, defect, irregularity or variance which does not affect substantial rights shall be disregarded.
Rule 31.01 is not at issue in this case though because Bouwman alleges that a substantial right of constitutional dimensions was affected.
[8] In State v. Bouwman, 328 N.W.2d 703 (Minn. 1982), we addressed an evidentiary issue certified to this court prior to the trial that gave rise to the present appeal. The question certified to this court was as follows:
May the court admit, at the trial of a defendant charged with murder in the first degree, expert psychiatric opinion testimony (not offered to establish a defense under Minn.Stat. § 611.026) that the defendant, at the time of the alleged crime, lacked the mental capacity to premeditate the killings or to form the specific intent to kill?
328 N.W.2d at 704-05. We answered the question in the negative. Id. at 705.
[9] The defense of voluntary intoxication is to be tried in part I of the bifurcated trial mandated by Rule 20.02, subd. 6(2), Minn.R.Crim.P. See supra, note 2. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603535/ | 8 So. 3d 643 (2009)
David GUTHRIE
v.
Derek B. BREAUX, et al.
No. 08-CA-576.
Court of Appeal of Louisiana, Fifth Circuit.
January 27, 2009.
Williams Family Law Firm, Richard Bray Williams, Attorney at Law, Natchitoches, Louisiana, for Plaintiff/Appellant.
Law Offices of Robert E. Birtel, Kevin T. Phayer, Attorney at Law, Metairie, Louisiana, for Defendant/Appellee Liberty Mutual Insurance Company.
Panel composed of Judges CLARENCE E. McMANUS, SUSAN M. CHEHARDY, and FREDERICKA HOMBERG WICKER.
CLARENCE E. McMANUS, Judge.
STATEMENT OF THE CASE
On August 8, 2006, David Guthrie and Derek Breaux were involved in an automobile accident. Guthrie was driving a 1997 Freightliner owned by his employer, United Parcel Service. At the time of the accident, Guthrie was in the course and scope of his employment with UPS. Guthrie's vehicle was rear ended by a car driven by Breaux. Breaux was insured by *644 American International Group ("AIG"). The vehicle owned by UPS was insured by Liberty Mutual Insurance Company.
On July 31, 2007, Guthrie filed a Petition for Damages naming Breaux, AIG, and Liberty Mutual as defendants. Guthrie later amended his petition to replace AIG with New Hampshire Indemnity, as Breaux's insurer. Guthrie claimed his damages are in excess of the liability limits of Breaux's liability policy, so he claims he is entitled to damages from Liberty Mutual under the uninsured/underinsured motorist coverage.
Liberty Mutual filed an Answer on October 11, 2007 arguing no uninsured/underinsured coverage under the UPS policy. Liberty Mutual also filed a motion for summary judgment on March 19, 2008. Liberty Mutual argues it did not provide UM coverage for UPS because the corporate representative of UPS, Pat Powers the corporate risk manager, executed a valid and enforceable rejection form which completely rejected UM bodily injury coverage.
On April 8, 2008, Guthrie filed an opposition to the motion for summary judgment, as well as a cross motion for summary judgment. Guthrie argues the rejection form was not properly completed, therefore, there is UM coverage on the UPS vehicle equal to the bodily injury liability coverage. Guthrie argues the legal representative of UPS, Pat Powers, did not print his name on the UM coverage rejection form when it was signed, as required by La. R.S. 22:680 and Duncan v. U.S.A.A. Insurance Company, 2006-363 (La.11/29/06), 950 So. 2d 544. Guthrie argues that since the form was not a valid rejection, UM coverage exists under this policy.
The trial court held a hearing on both motions for summary judgment on April 22, 2008. The trial court executed a Judgment on April 30, 2008, granting summary judgment in favor of Liberty Mutual, dismissing all claims against it with prejudice. The cross motion for summary judgment by Guthrie was denied.
Guthrie now appeals this judgment. For the reasons which follow, we affirm the trial court's judgment granting Liberty Mutual's motion for summary judgment and denying Guthrie's cross motion for summary judgment.
DISCUSSION
On appeal, Guthrie argues two assignments of error. Guthrie argues that the trial court erred in granting Liberty Mutual's motion for summary judgment and the trial court erred in denying the cross motion for summary judgment he filed. Both motions dealt with the validity of the UM coverage rejection form. Therefore, the only issue before this Court on appeal is whether or not the UM coverage rejection form completed by UPS's corporate representative, Pat Powers, was valid and enforceable.
La. R.S. 22:680 governs the issuance of uninsured motorist coverage in Louisiana. La. R.S. 22:680(1)(a)(ii) provides, in part, as follows:
Such rejection, selection of lower limits, or selection of economic-only coverage shall be made only on a form prescribed by the commissioner of insurance. The prescribed form shall be provided by the insurer and signed by the named insured or his legal representative. The form signed by the named insured or his legal representative which initially rejects such coverage, selects lower limits, or selects economic-only coverage shall be conclusively presumed to become a part of the policy or contract when issued and delivered, irrespective of whether physically *645 attached thereto. A properly completed and signed form creates a rebuttable presumption that the insured knowingly rejected coverage, selected a lower limit, or selected economic-only coverage. The form signed by the insured or his legal representative which initially rejects coverage, selects lower limits, or selects economic-only coverage shall remain valid for the life of the policy and shall not require the completion of a new selection form when a renewal, reinstatement, substitute, or amended policy is issued to the same named insured by the same insurer or any of its affiliates....
The Louisiana Supreme Court has addressed the issue of the validity of UM rejection forms and has provided further explanation of the statutory requirements of these rejections forms. In Duncan v. U.S.A.A., supra, the Louisiana Supreme Court found that the statute, La. R.S. 22:680, only requires three things: 1) that the rejection or selection be made on a form prescribed by the commissioner of insurance, 2) that the form be provided by the insurer, and 3) that the form be signed by the named insured or his legal representative. The Louisiana Supreme Court went on to find that the form prescribed by the commissioner of insurance requires six things: 1) initialing the selection or rejection of coverage chosen, 2) if limits lower than the policy limits are chosen, then filling in the amount of coverage selected for each person and each accident, 3) printing the name of the name insured or legal representative, 4) signing the name of the name insured or legal representative, 5) filling in the policy number, and 6) filling in the date.
The Supreme Court in Duncan found that the form drafted by the commissioner of insurance requires these six tasks, even though the statute only requires three. The Supreme Court held that all six tasks are required to validly reject UM coverage. In Duncan, the Supreme Court ultimately held the rejection form to be invalid, but only because of the failure of the insured to fill in the policy number on the form.
The issue in this case is the printing of the insured's name on the form. On the waiver form in this case, the policy number and the named insured's name, United Parcel Service, was typed onto the form. Pat Powers, as legal representative and corporate risk manager of UPS, signed and dated the form and initialed the box indicating UPS did not want UMBI coverage. The policy number and the named insured had already been typed in the appropriate spaces when Powers signed the form.
We find the waiver form executed by Powers is a valid waiver of UM coverage in this case. We further find the completed form meets the requirements of the statute, as well as the six tasks outlined in Duncan. Pat Powers' name was not printed on the form, however, the named insured, United Parcel Service, was printed on the form. In Duncan, the Louisiana Supreme Court stated one of the required items to be placed on the form is the printing of the name of the insured or the legal representative. La. R.S. 22:680 requires the form to be signed by the named insured or legal representative. In this case, the named insured is UPS, but the form was signed by the legal representative, Pat Powers. In Duncan, the Supreme Court did not find that the named insured and the legal representative's name must be printed. Only one or the other must be printed.
The named insured in this case is a corporation, therefore, the form must be signed by the legal representative. We *646 find there is no requirement that the individual legal representative's name be printed on the form, in addition to the printed name of the insured corporation. In this case, the named insured, United Parcel Service, was printed on the form and we find this meets the statutory requirements of La. R.S. 22:680, as well as those set forth in Duncan.
Accordingly, we find the trial court correctly granted summary judgment in favor of Liberty Mutual, finding the UMBI waiver form to be valid and dismissing all claims against it, and correctly denied Guthrie's cross motion for summary judgment.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552375/ | 239 B.R. 412 (1999)
In re William Oren HOUGH, Jr., and Barbara Irene Hough, Debtors.
Barbara Irene Hough, Appellant,
v.
Robert A. Fry and Elizabeth G. Fry, dba Gem Physical Therapy Clinic; and Chip Sands, Appellees.
BAP No. ID-99-1092-BRP. Bankruptcy No. 98-01101. Adversary No. 98-6172.
United States Bankruptcy Appellate Panel of the Ninth Circuit.
Submitted Without Oral Argument June 23, 1999.[1]
Decided September 10, 1999.
*413 Jake W. Peterson, Boise, ID, for Barbara Irene Hough.
Cathleen M. Morgan, Quane, Smith, Howard & Hull, Boise, ID, for Robert A. Fry and Elizabeth G. Fry.
Before: BRANDT, RUSSELL, and PERRIS, Bankruptcy Judges.
OPINION
BRANDT, Bankruptcy Judge.
The bankruptcy court granted appellees' motion for summary judgment, declaring appellant's debt for fees and costs awarded to appellees in state court litigation excepted from discharge under § 523(a)(17)[2]. This appeal followed. We REVERSE and REMAND.
I. FACTS
These facts are taken essentially verbatim from the bankruptcy court's published decision, Fry v. Hough (In re Hough), 228 B.R. 264, 265 (Bankr.D.Idaho 1998).
Appellant Barbara Hough ("Hough") filed a chapter 7 bankruptcy petition with the bankruptcy court on 8 April 1998. Appellees Robert and Elizabeth Fry (d/b/a Gem Physical Therapy Clinic) ("Fry") and Chip Sands ("Sands") are included among her creditors. In June, 1995, Hough sued Fry and Sands in state court, alleging she had retained Chip Sands, a physical therapist employed in a clinic owned and operated by Fry, and that during a treatment session, she was injured as a result of Sands' negligence. The state district court disagreed, granted Fry and Sands summary judgment, and awarded them approximately $1,600 in costs against Hough.
Hough appealed to the Idaho Supreme Court. That court not only affirmed the district court's decision, but also awarded Fry and Sands another $4,600 in attorneys' fees and costs incurred on appeal under Idaho Code § 12-121. The court found that Hough's appeal had been "frivolous, unreasonable and without foundation." Hough v. Fry, 131 Idaho 230, 953 P.2d 980, 984 (1998).
Fry and Sands commenced an adversary proceeding seeking to obtain a declaration from the bankruptcy court that the fee and cost awards were excepted from discharge in bankruptcy by § 523(a)(17). On summary judgment, the bankruptcy court issued its memorandum of decision (cited above), an order granting the motion for summary judgment, and a judgment declaring the debt excepted from discharge under § 523(a)(17). Hough timely appealed; by stipulation, the appeal was submitted without argument.
II. ISSUE
Whether the bankruptcy court erred in finding fees and costs imposed by a state court in a civil action against one not a prisoner excepted from discharge by § 523(a)(17).
III. STANDARD OF REVIEW
We review summary judgments and issues of statutory interpretation de novo. United States v. Towers (In re Feiler), 230 B.R. 164, 167 (9th Cir. BAP 1999).
IV. DISCUSSION
A. The Prison Litigation Reform Act:
Section 523(a)(17) renders nondischargeable any debt:
for a fee imposed by a court for the filing of a case, motion, complaint, or appeal, or for other costs and expenses assessed with respect to such filing, regardless of an assertion of poverty by the debtor under § 1915(b) or (f) of title 28, or the debtor's status as a prisoner, as defined in section 1915(h) of title 28[.]
*414 The section was added to the Bankruptcy Code by the Prison Litigation Reform Act of 1995 ("Act"), Pub.L. No. 104-134, 110 Stat. 1321-66. Subsections 804(a) and (c) of the Act amended the federal in forma pauperis statute, 28 U.S.C. § 1915, to require prisoner-litigants to pay the full amount of court filing fees and costs; at the same time, the amended statute permits payments to be made in installments. See Pub.L. No. 104-134, 110 Stat. XXXX-XX-XX (codified at 28 U.S.C. § 1915(b) and (f)). Subsection 804(b) of the Act added § 523(a)(17) to the Bankruptcy Code. See Pub.L. No. 104-134, 110 Stat. 1321-74.
The in forma pauperis statute (as amended by the Act) provides, in pertinent part:
§ 1915. Proceedings in forma pauperis
(a)(1) Subject to subsection (b), any court of the United States may authorize the commencement, prosecution or defense of any suit, action or proceeding, civil or criminal, or appeal therein, without prepayment of fees or security therefor, by a person who submits an affidavit that includes a statement of all assets such prisoner possesses that the person is unable to pay such fees or give security therefor. . . .
. . .
(b)(1) Notwithstanding subsection (a), if a prisoner brings a civil action or files an appeal in forma pauperis, the prisoner shall be required to pay the full amount of a filing fee. The court shall assess and, when funds exist, collect, as a partial payment of any court fees required by law, an initial partial filing fee. . . .
. . .
(f)(1) Judgment may be rendered for costs at the conclusion of the suit or action as in other proceedings. . . .
(2)(A) If the judgment against a prisoner includes the payment of costs under this subsection, the prisoner shall be required to pay the full amount of the costs ordered.
28 U.S.C. § 1915 (West 1999).
B. Interpreting the Act:
The central, indeed sole, issue in this appeal is the scope of § 523(a)(17); specifically, whether this exception to discharge applies to an award of attorney fees in a civil action under state law against a nonprisoner debtor, when those fees were not assessed pursuant to 28 U.S.C. § 1915(b) or (f).
The "first step in interpreting a statute is to determine whether the language at issue has a plain and unambiguous meaning with regard to the particular dispute in the case." Robinson v. Shell Oil Co., 519 U.S. 337, 340, 117 S. Ct. 843, 136 L. Ed. 2d 808 (1997). The reviewing court's "inquiry must cease if the statutory language is unambiguous and `the statutory scheme is coherent and consistent.'" Id. (quoting United States v. Ron Pair Enterprises, Inc., 489 U.S. 235, 240, 109 S. Ct. 1026, 103 L. Ed. 2d 290 (1989)). whether a statute is ambiguous is "determined by reference to the language itself, the specific context in which that language is used, and the broader context of the statute as a whole." Id. at 341, 117 S. Ct. 843 (citations omitted).
The bankruptcy court, looking for "plain meaning," found § 523(a)(17) unambiguous, and held that the statute "applies, on its face, to any debts imposed by a court for filing fees, or for other expenses associated with respect to a case." Hough, 228 B.R. at 266. As a result, "attorneys fees and costs assessed by a court against a nonprisoner litigant, who later seeks bankruptcy relief, are clearly excepted from bankruptcy discharge." Id. While hinting at legislative malpractice, in that Congress may have used language too broad to accomplish its purpose of deterring frivolous lawsuits by prisoners, the bankruptcy court refrained from judicial amendment of what it found to be a "clearly worded statute[,]" id., rejecting the conclusion reached in the only other reported decisions *415 dealing with § 523(a)(17), Matter of South Bend Community School Corp. v. Eggleston (In re Eggleston), 215 B.R. 1012 (N.D.Ind.1997), and Walker v. Tuttle (In re Tuttle), 224 B.R. 606 (Bankr.W.D.Mich. 1998). (Another reported decision discusses § 523(a)(17), but does not purport to analyze the exception's scope. See In re Vasquez, 205 B.R. 136, 138-39 (Bankr. N.D.Ill.1997).)
The bankruptcy court here found it "unnecessary to go to the lengths engaged in by the courts in Tuttle and [Eggleston] to interpret away this straightforward, albeit arguably unintended, meaning of this enactment." Hough, 228 B.R. at 266. While the Eggleston court does not appear to have taken into account the plain meaning of the statute before deciding that legislative history warrants application of the statute only to prisoners, the Tuttle court's analysis is compelling. After considering the plain language of § 523(a)(17), the Tuttle court noted:
The ambiguity in the statute arises principally from the absence of a comma between "debtor" and "under," and from the unfortunate placement of the phrase "under § 1915(b) or (f) of title 28." Because of the proximity of this phrase to the antecedent phrase "regardless of an assertion of poverty by the debtor," a reader may first assume that the reference to 28 U.S.C. § 1915 simply modifies the phrase "assertion of poverty," without limiting other phrases within the paragraph. This reading, though perhaps initially appealing, is erroneous.
Tuttle, 224 B.R. at 609.
Because of the statute's explicit reference to the in forma pauperis statute, 28 U.S.C. § 1915, Judge Gregg concluded that the two statutes must be read in conjunction with one another:
A careful reading of 28 U.S.C. § 1915 reveals that a litigant who seeks relief from court filing fees under the federal in forma pauperis statute does not assert his or her poverty under 28 U.S.C. § 1915(b) or (f), but rather makes the assertion (specifically, in an affidavit) under § 1915(a). Significantly, § 1915(b) and (f)(1) are the provisions of the statute that respectively (1) require a federal court to "assess" the full amount of court filing fees against prisoner litigants, and (2) authorize a federal court to impose "costs" against litigants (prisoners and non-prisoners, alike) who proceed in forma pauperis. Given that these two subsections of 28 U.S.C. § 1915 pertain to the assessment or imposition of fees and costs, it makes much greater sense to read the clause "under § 1915(b) or (f) of title 28" as limiting the antecedent phrase "fee imposed by a court for the filing of a case, motion, complaint, or appeal, or for other costs and expenses assessed with respect to such filing . . .", rather than just the phrase "assertion of poverty."
. . . Accordingly, this judge believes that the exception to discharge contained in 11 U.S.C. § 523(a)(17) preserves only a debtor's liability for fees, costs, or expenses imposed or assessed under 28 U.S.C. § 1915(b) (against prisoners) or (f) (against prisoners or other persons).
Tuttle, 224 B.R. 606, 609-10 (footnote omitted).
The Tuttle court noted that its construction was consistent with the principle of statutory construction known as reddendo singula singulis, "more modernly expressed as . . . `[w]here a sentence contains several antecedents and several consequents they are to be read distributively. The words are to be applied to the subjects that seem most properly related by context and applicability.'" Id. at 610 (quoting 2A Norman J. Singer, Sutherland Statutory Construction § 47.26 (5th ed.1992)).
Tuttle is well-reasoned and consistent with canons of statutory construction set forth by both the Supreme Court and the Ninth Circuit Court of Appeals. Although Tuttle resorts to legislative history and *416 policy arguments to bolster its conclusion, the court's analysis is solidly based on the words of the statute, the starting point for any statutory interpretation. In re Jones, 106 F.3d 923, 925 (9th Cir.1997). In concluding that § 523(a)(17) is ambiguous, the Tuttle court referred to its language, the context of that language, and the broader context of the statute as a whole (taking into consideration its relationship with the Act), as instructed by the Supreme Court in Robinson, 519 U.S. at 340, 117 S. Ct. 843, 136 L. Ed. 2d 808. Robinson involved interpretation of the seemingly straightforward term "employee" under Section 704(a) of Title VI of the Civil Rights Act of 1964; its canons of construction are thus appropriate here.
Using these canons, the Tuttle court's construction is bolstered by the structure of the Prison Litigation Reform Act: Subsection 804(a) of the Act added to 28 U.S.C. § 1915 a new section (b), which provides for assessment of the full amount of filing fees against a prisoner; subsection 804(b) added § 523(a)(17) to the Bankruptcy Code; and subsection 804(c) added a new subsection to 28 U.S.C. 1915(f), requiring prisoners to pay the full amount of any costs imposed by the court.
That the nondischargeability provision appears between the amendments to 28 U.S.C. §§ 1915(b) and (f) the same subsections referenced in § 523(a)(17) is strong evidence that the nondischargeability provision was intended to apply only to the fees and costs referenced in those subsections. As Judge Gregg observed, "the new procedures for installment payments by prisoners and the addition of the exception to discharge now codified in § 523(a)(17) were created in the same section of the Act. They complement each other." Tuttle, 224 B.R. at 609.
When § 523(a)(17) is read with the knowledge that §§ 1915(b) and (f) do not deal with the assertion of poverty, the nondischargeability section no longer has a plain meaning. At that point, the reasonable interpretation is that the fees and costs to be excepted from discharge are those imposed by the referenced statutes. To read the provision otherwise would render the references to 28 U.S.C. §§ 1915(b) and (f) superfluous, a result disfavored under accepted rules of statutory construction. See In re Loretto Winery Ltd., 898 F.2d 715, 722 (9th Cir.1990).
V. CONCLUSION
The bankruptcy court erred in its conclusion that attorneys' fees and costs here awarded pursuant to Idaho statute were excepted from discharge. Section § 523(a)(17) applies only to fees and costs imposed on prisoner litigants under the federal in forma pauperis statute. We REVERSE and remand for entry of judgment declaring the debt dischargeable.
NOTES
[1] The parties filed a stipulation to waive oral argument, which was granted in a Clerk's Order filed on April 27, 1999.
[2] Absent contrary indication, all section and chapter references are to the Bankruptcy Code, 11 U.S.C. §§ 101-1330, and all "Rule" references are to the Federal Rules of Bankruptcy Procedure. "FRCP" references are to the Federal Rules of Civil Procedure. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603618/ | 354 N.W.2d 29 (1984)
STATE of Minnesota, Respondent,
v.
Anthony Frank FISCHER, Appellant.
No. C6-83-2012.
Court of Appeals of Minnesota.
August 14, 1984.
*31 Hubert H. Humphrey, III, Atty. Gen., St. Paul, John E. MacGibbon, Sherburne County Atty., Kim Brandell, Asst. County Atty., Elk River, for respondent.
C. Paul Jones, Public Defender, Brian I. Rademacher, Asst. Public Defender, Minneapolis, for appellant.
Considered and decided by POPOVICH, C.J., and PARKER and CRIPPEN, JJ., with oral argument waived.
OPINION
PARKER, Judge.
Appellant Anthony Frank Fischer was convicted by a jury of three counts of terroristic threats in violation of Minn.Stat. § 609.713, subd. 1 (1982), misdemeanor obstructing legal process in violation of Minn. Stat. § 609.50 (1982), and misdemeanor assault in the fourth degree in violation of Minn.Stat. § 609.224, subd. 2 (1982). Appellant claims he was denied a fair trial by evidentiary rulings which allowed the State to impeach him with a prior conviction if he testified and to introduce evidence of three Spriegl incidents. He also contends the evidence was insufficient to convict him of terroristic threats. Finally, he claims the offenses arose out of the same behaviorial incident and the sentences exagerated the criminality of his conduct. We affirm.
FACTS
Appellant was married to Janet (Bockoven) Fischer. They obtained a divorce in 1981. Since then, appellant has often told Janet of his love for her and of his interest in a reconciliation. Janet's sister is Vicki Griswold. Vicki's husband's best friend was Robert "Dale" Porter, who had dated Janet since 1980. By the date of trial, Janet and Dale had tentative plans to marry each other.
On April 4, 1983, at about 6:15 p.m., appellant telephoned Vicki at her home. Appellant expressed anger at other members of her family, blaming them for the breakup of his marriage. He made about six phone calls throughout that evening to Vicki over a period of about six hours. In two of the calls Vicki heard gunshot sounds, and appellant told her that he had a 30.06 rifle. The shooting was interspersed among comments by appellant that if Janet ever remarried, he would kill Dale Porter, Janet and himself. After one of the gunshots he told Vicki that he was shooting Porter in the head and said, "that was Porter" and that "he [appellant] splattered his [Porter's] brains on the wall."
Vicki telephoned Janet and also called the police to report that appellant had weapons.
Dale Porter testified that he was over at Vicki's home the evening when appellant called. Porter secretly listened in on two of the calls on an extension phone in the garage. He heard appellant ask Vicki something like, "what's Janet doing screwing around with that Porter character?" He also heard shots from a rifle followed by appellant's statement, "Hear that, Vicki? That's Porter's brains are all over the wall." This was repeated three or four times, with appellant saying, "I'm going to get him. He's a dead man." Porter also overheard appellant threaten to kill Janet, Porter and himself if Porter and Janet married.
Janet testified that on the night of April 4 Vicki called her and told her to be careful because appellant was angry. Janet later called the police to tell them that appellant was on a "rampage." Janet was informed the next day of appellant's specific threats.
At about 10:00 p.m. appellant made two telephone calls to Jerald Bockoven, Janet and Vicki's father. Jerald testified that appellant told him that he, Jerald, was the cause of all the trouble appellant has had. In both phone calls, Jerald heard two to four shots from a gun which sounded like a .22 rifle. Once, after discharging the rifle, appellant said the next one was for Jerald. At one point appellant said, "I'm going to smash your face up so it looks like a squashed tomato."
At about 11:30 p.m. officers of the Sherburne County Sheriff's Department arrived *32 at appellant's house following a call from appellant and a call from Janet. Appellant talked with Sergeant LeRoy Basavage, who testified that appellant was extremely disturbed and talked of suicide. The officers left to speak with Janet and Dale Porter, and they returned to appellant's house to arrest him. Appellant was still distraught and smelled of alcohol, although he did not appear intoxicated.
Upon being told he was under arrest, appellant refused to accompany the officers. Appellant swung and hit Basavage in the lip. He was restrained and eventually calmed down. He was released but later became upset again and reached out with his fists clenched. The officers handcuffed appellant and carried him away, kicking and struggling.
In appellant's house, bullet holes were discovered. The police received four rifles from appellant's brother, who had removed them from the house at appellant's request.
Appellant was charged with terroristic threats against Janet, Dale Porter and Jerald Bockoven, obstructing legal process, and assault in the fourth degree. Prior to trial, the State received permission to introduce evidence of three prior assaultive acts of appellant (Spreigl evidence): (1) On December 29, 1980, while separated from Janet, appellant held his family at gunpoint and threatened to commit suicide unless Janet was summoned to the scene. Appellant then surrendered to the authorities. (2) On September 7, 1981, appellant struck Janet in the face and body, causing her to fall from a chair and break a finger. (3) On October 1, 1981, appellant poured hot coffee down the front of Janet's dress. She was severely burned. Appellant was convicted of assault in the third degree for this incident. The jury did not learn of the conviction because, although the trial court had earlier ruled that the conviction was admissible for impeachment purposes, appellant did not testify.
At trial Janet Fischer and Jerald Bockoven both testified about all three of the Spreigl incidents. Vicki Griswold and Dale Porter testified that they were aware of the two incidents involving injury to Janet.
The trial court gave cautionary instructions to the jury concerning the Spreigl evidence, once after the first Spreigl evidence was elicited and again in the final instructions. Following conviction on all five offenses, appellant was sentenced to concurrent executed sentences of 18 months, 21 months, 25 months, 12 months and 90 days.
ISSUES
1. Was appellant denied a fair trial because of the trial court's ruling that his prior conviction was admissible for impeachment or its ruling that the Spreigl incidents were admissible?
2. Was the evidence sufficient to convict appellant of terroristic threats?
3. Did the sentences violate the prohibition against punishing an individual twice for a single behaviorial incident?
ANALYSIS
I
Appellant claims he was denied a fair trial because of certain trial court evidentiary rulings.
A. Appellant contends the trial court erred in its pretrial ruling that the State was permitted to use his prior conviction of assault in the third degree to impeach his credibility if he testified. Appellant did not testify. We do not find any clear abuse of discretion in letting the State use the prior conviction. See State v. Brouillette, 286 N.W.2d 702 (Minn.1979); State v. Jones, 271 N.W.2d 534 (Minn. 1978). A detailed analysis of the use of prior convictions for impeachment is in State v. Heidelberger, 353 N.W.2d 582 at 588-591 (Minn.Ct.App.1984); it is clear that the instant case similarly is lacking in error on this ground.
B. Appellant next complains about the trial court's decision declaring three prior Spreigl incidents admissible to show the prior relationship between appellant *33 and the victims of the terroristic threats. Prior to trial, the State sought to introduce about 15 prior acts committed by appellant. The trial court allowed three prior incidents to show appellant's relationship with the victims as bearing on his intent and motive at the time he made the threats.
The trial court's ruling was within its sound discretion. State v. Kutchara, 350 N.W.2d 924 at 926 (Minn.1984). Rule 404(b), Minn.R.Evid., provides:
Evidence of other crimes, wrongs, or acts is not admissible to prove the character of a person in order to show that he acted in conformity therewith. It may, however, be admissible for other purposes, such as proof of motive, opportunity, intent, preparation, plan, knowledge, identity, or absence of mistake or accident.
This evidence is admissible if "defendant's participation in the other crimes is clear and convincing, if the evidence is relevant and material to the state's case, and if the probative character of the evidence outweighs its potential for unfair prejudice." Ture v. State, 353 N.W.2d 518 at 521 (Minn.1984). The evidence of the other incidents was clear and convincing. Appellant challenges the revelance and the probative value of the evidence.
In the leading Minnesota case involving terroristic threats, the Minnesota Supreme Court allowed evidence of the defendant's prior homosexual relationship with the victim as "bearing upon the relationship between the accused and the victim and [establishing] a motive for the commission of the offense charged." State v. Schweppe, 306 Minn. 395, 402, 237 N.W.2d 609, 615 (1975). See also State v. Gavle, 234 Minn. 186, 207-08, 48 N.W.2d 44, 56 (1951).
Here it is clear the evidence of appellant's prior relationship with the victims was relevant to establish appellant's intent and motive for making the threats. See State v. Roberts, 350 N.W.2d 448 at 451 (Minn.Ct.App.1984).
Moreover, this evidence was relevant to the victims' reactions to the threats, which is "circumstantial evidence relevant to the element of intent of the defendant in making the threat." Schweppe, 306 Minn. at 401, 237 N.W.2d at 614.
Finally, the evidence was relevant in rebutting appellant's claim that his actions the night of April 4, 1983, were mere episodes of "transitory anger." Thus, no abuse of discretion was shown in admitting the Spreigl evidence. We reject appellant's contention that the repeated introduction of the evidence through several State's witnesses was unduly prejudicial.
II
Appellant complains the evidence was insufficient as a matter of law to sustain his conviction of terroristic threats. Among his contentions are that his actions only expressed "transitory anger" and he was merely letting off steam and that he did not intentionally or in reckless disregard cause the threats to be communicated to Janet Fischer or Dale Porter, since the threats were made in phone calls to Vicki Griswold.
In passing on appellant's assertions, we are mindful of our scope of review.
In reviewing a claim of insufficiency of the evidence, we are limited to ascertaining whether, given the facts in the record and the legitimate inferences that can be drawn from those facts, a jury could reasonably conclude that the defendant was guilty of the offense charged.
State v. Merrill, 274 N.W.2d 99, 111 (Minn. 1978). In doing so, we construe the record most favorably to the State and assume the evidence supporting the conviction was believed and the contrary evidence disbelieved. State v. Pieschke, 295 N.W.2d 580, 584 (Minn.1980).
The terroristic threat statute provides:
Whoever threatens to commit any crime of violence with purpose to terrorize another or to cause evacuation of a building, place of assembly or facility of public transportation or otherwise to cause serious public inconvenience, or in *34 a reckless disregard of the risk of causing such terror or inconvenience may be sentenced to imprisonment for not more than five years.
Minn.Stat. § 609.713, subd. 1 (1982). The essential elements of this offense were thoroughly discussed in Schweppe. The court stated:
A threat is a declaration of an intention to injure another or his property by some unlawful act. * * * The test of whether words or phrases are harmless or threatening is the context in which they are used. * * * Thus, the question of whether a given statement is a threat turns on whether the "communication `in its context' would `have a reasonable tendency to create apprehension that its originator will act according to its tenor.'" * * *.
Section 609.713, subd. 1, requires that defendant utter the threat with the purpose of terrorizing another. Purpose in this context means aim, objective or intention. * * * Terrorize means to cause extreme fear by use of violence or threats.
Schweppe, 306 Minn. at 399-400, 237 N.W.2d at 613-14.
We do not agree with appellant's characterization of his actions as "transitory anger." His actions continued for almost six hours and were consistent with his pattern of behavior for the 18 months following his separation from Janet. It is a mockery to suggest his actions were spur-of-the-moment threats. Further, his argument that he was merely blowing off a little steam is unsupported, as there are other methods of blowing off steam besides discharging firearms while threatening to kill people.
Appellant also claims the evidence is insufficient to show that he intentionally or with reckless disregard communicated a threat to Dale Porter or to Janet Fischer. In Schweppe, the defendant threatened the victims by uttering threats in the presence of and by conversing with friends and acquaintances of the victims. The Supreme Court determined the evidence supported a finding:
that defendant knew, or had reason to know, and thus intended that his threats to kill [the victim] would be communicated to him. * * * The jury also may well have concluded that defendant at the very least recklessly risked the danger that his threats would be communicated and thereby would terrorize [the victim]. Other courts have concluded that a defendant need not directly communicate the threat to the intended victim to be guilty of making a criminal threat.
Id. at 400-01, 237 N.W.2d at 614 (citations omitted).
Here, appellant made the threats directly to Jerald and to Vicki, Janet's sister and wife of Dale Porter's best friend. This evidence clearly supports the finding that appellant knew or had reason to know his threats would be communicated to the victims or that he recklessly risked the danger that his threats would be so communicated.
III
Appellant claims that the five sentences imposed were improper because they all arose out of the same behaviorial incident or, alternatively, the obstructing justice and assault offenses constituted a single behaviorial incident. Minn.Stat. § 609.035 (1982) provides:
Except as provided in section 609.585, if a person's conduct constitutes more than one offense under the laws of this state he may be punished for only one of such offenses and a conviction or acquittal of any one of them is a bar to prosecution for any other of them. All such offenses may be included in one prosecution which shall be stated in separate counts.
In determining whether the offenses involved the same behavioral incident, we must examine whether "the underlying conduct was motivated by a desire on the defendant's part to obtain a single criminal objective or by two or more criminal objectives." State v. Thomas, 352 N.W.2d 526 at 529 (Minn.Ct.App.1984), *35 quoting Mercer v. State, 290 N.W.2d 623, 626 (Minn.1980). The focus is on the factors of time and place. State v. Boley, 299 N.W.2d 924, 926 (Minn.1980). We believe it is clear that appellant's intent in making the terroristic threats was clearly separate and distinct from assaulting the officer or in obstructing legal process.
Further, while it is a close question, the assault and obstruction offenses were separate and distinct. The initial assault occurred against one officer upon appellant being told he was under arrest. Later, after he calmed down and had been released, he obstructed legal process in a vain attempt at avoiding apprehension. These offenses were thus separately motivated and separated in time sufficiently to allow multiple punishment for his actions.
While acknowledging the multiple victim exception to Minn.Stat. § 609.035 (1982) (described in State v. Gartland, 330 N.W.2d 881, 883 (Minn.1983)), appellant argues that separate sentences unfairly exaggerated the criminality of his conduct because at the time he made the threats he was depressed, in a disturbed state of mind, suicidal and had been drinking. It is unclear how these alleged circumstances show the sentences exaggerate his criminality. Appellant was clearly aware there were multiple victims of his threats because he threatened more than one victim. See State v. Rieck, 286 N.W.2d 724, 727 (Minn.1979). His actions were also gratuitous in that they were not necessitated by any of his earlier actions against the earlier victims of his threats. See State v. DeFoe, 280 N.W.2d 38, 42 (Minn.1979). That appellant may have lost control over his emotions and gone on a 5½ hour rampage does not mean that he cannot be sentenced separately for each victim. See State v. Kennedy, 342 N.W.2d 631 (Minn.1984).
Appellant's alternative argument is that since the terroristic threats against Janet Fischer and Dale Porter arose from phone calls to only one person, Vicki Griswold, and involved the single objective of discouraging Janet from remarrying, separate sentences for these two counts unfairly exaggerated the criminality of his conduct. This argument, while creative, is also unsupported and we decline to create an exception along the lines suggested by appellant.
DECISION
Appellant was not denied a fair trial because of the trial court's evidentiary rulings admitting a prior conviction for impeachment and admitting Spreigl evidence. The evidence was sufficient to convict appellant of terroristic threats. Appellant's sentence did not unfairly exaggerate the criminality of his conduct or punish him twice for a single behavioral incident.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603518/ | 882 F.Supp. 321 (1995)
Ramakrishna C.V. RAO, Plaintiff,
v.
NEW YORK CITY HEALTH AND HOSPITALS CORPORATION, et al., Defendants.
Nos. 89 Civ. 2700, 89 Civ. 7060 (JGK).
United States District Court, S.D. New York.
April 7, 1995.
*322 *323 Michael H. Sussman, Sussman Law Offices, Goshen, NY, for plaintiff.
Paul A. Crotty, Corp. Counsel of the City of New York, New York City (Steven J. Rappaport, Bruce Rosenbaum and Julie O'Neill, of counsel), for defendants.
OPINION & ORDER
KOELTL, District Judge.
After a nine day trial of these consolidated cases, a jury returned a verdict based on answers to special interrogatories finding for the plaintiff, Ramakrishna Rao, against defendants Anthony Japha, Dennis Newman, and Robert Weigand on the plaintiff's claim that their termination of his employment at the New York City Health and Hospital's Corporation ("HHC") violated his First Amendment rights. The jury awarded compensatory damages of $100,000 under 42 U.S.C. § 1983. It found defendant Paul Rozsypal not to be liable for any violation of the plaintiff's First Amendment rights and found that none of the defendants terminated the plaintiff's employment on account of his national origin.[1] The jury also found that the wrongful actions of the liable defendants were not taken pursuant to an official policy, custom, or practice of HHC and therefore found HHC not to be liable to the plaintiff. See Monell v. Dep't of Social Services, 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978).
In addition to his § 1983 claims for violation of First and Fourteenth Amendment rights, the plaintiff pleaded claims for violations of Title VII of the Civil Rights Act of 1964 which were not presented to the jury, because this action was filed prior to the 1991 amendments to the Act. See Postema v. National League of Professional Baseball Clubs, 998 F.2d 60, 61-62 (2d Cir.1993) (holding that 1991 Civil Rights Act amendments to Title VII providing for jury trials are not retroactive).
There are presently four applications before the court regarding the judgment to be entered. The plaintiff seeks reinstatement to his position with HHC, or alternatively front pay, prejudgment interest on the damage award, and a letter stating that he was terminated from HHC in violation of his *324 First Amendment rights. The defendants seek the entry of findings of fact and conclusions of law in their favor on the plaintiff's Title VII claims.
At trial, all of the defendants admitted to having participated in the termination of the plaintiff's employment with, HHC in March, 1987. The jury was asked to determine whether: 1). the individual defendants were motivated by Rao's national origin to terminate his employment, and 2) whether Rao had engaged in various forms of speech that the Court found to be protected by the First Amendment and whether such speech was a substantial or motivating factor in the defendants' termination decisions. The jury found that for defendants Japha, Newman, and Weigand the following instances of protected speech were substantial or motivating factors in their decisions to terminate Rao: (1) Rao's verbal complaints about the failure of a contractor, Joseph L. Muscarelle Inc., to comply with the terms of its contract for work to be done at the Cumberland Neighborhood Family Care Center in Brooklyn, and (2) Rao's December 15, 1986 memorandum to defendant Weigand about Muscarelle's alleged failings and about alleged extortionate threats made by a community group demanding money and jobs at the project. Thus, the jury's answers to the special interrogatories established that defendants Weigand, Japha, and Newman terminated Rao's employment in violation of 42 U.S.C. § 1983.[2]
I.
At argument on the applications, and subsequently in a submission to the Court, the plaintiff stated that, in view of the jury's finding that he was not terminated because of his national origin, he was withdrawing his Title VII claim. At trial, he conceded that the only arguable basis for Title VII liability in this case was that he was terminated due to his national origin, and he withdrew his other Title VII claims. The plaintiff contends that he may now withdraw his remaining Title VII claim, but the defendants have not agreed to allow withdrawal and have submitted brief proposed findings of fact, and conclusions of law deciding, the claim in their favor.
The plaintiff may, not unilaterally withdraw his claim after the close of the trial. See Wakefield v. Northern Telecom, Inc., 769 F.2d 109, 114-15 (2d Cir.1985) (holding that district court erred in dismissing claim without prejudice, rather than with prejudice, where claim was withdrawn by the plaintiff at close of trial due to lack of evidence). Therefore, the Court makes the following findings of fact and conclusions of law with respect to the plaintiff's Title VII claim.
On July 21, 1986, HHC hired Rao as a Director, Engineering and Facilities Services, Capital Programs, on the recommendation of defendant Robert Weigand who was Senior Deputy and Chief Engineer, Capital Programs. During his tenure at HHC, Rao's superiors were defendants Weigand; Paul Rozsypal, Group Director, Construction Management, Capital Programs; Dennis Newman, Assistant Vice President and Chief Engineer, Capital Programs; and Anthony Japha, Senior Assistant Vice President, Capital Programs.
Rao was initially assigned as Director of HHC's North District, which encompassed the Bronx and Upper Manhattan. In the North District, Rao had encountered significant difficulties with a subordinate, Gary Yates, whom Rao considered to be insubordinate. In December, 1986, defendants transferred Rao to a temporary assignment as the on-site project manager at the Cumberland Neighborhood Family Care Center in Brooklyn, which was undergoing extensive renovation in HHC's most expensive new construction project at that time. Rao authored a December 15, 1986 memo to defendant Weigand complaining about numerous aspects of the Cumberland project, including alleged deficiencies in the performance of Joseph L. *325 Muscarelle, Inc., a contractor, and alleged extortion attempts by a community action group. Weigand was not pleased with the memo, alleging at trial that the reason for his dissatisfaction was that he was already aware of virtually everything reported in it.
On December 23, 1986, Rao met with defendant Japha and they discussed some of Rao's concerns about his employment situation. Japha told Rao that if he could not get along with Weigand, he should find another job.
On or about February 10, 1987, defendant Weigand informed Rao that his services were no longer required and offered him the option of resigning. Weigand had discussed the decision to terminate Rao with both Japha and Newman who concurred. On February 13, 1987, Rao was informed that he had been given an unsatisfactory performance evaluation. Rao received a copy of the evaluation on February 23, 1987.
On February 13, 1987, Rao filed complaints with HHC's Equal Employment Office and the U.S. Equal Employment Opportunity Commission, charging discrimination in the terms and conditions of his employment on the bases of his age, race, color, national origin, religion, and creed.
On or about March 6, 1987, Rao received a letter informing him that his employment with HHC would be terminated effective March 13, 1987.
On March 13, 1987, Rao filed a supplemental charge of discrimination with the EEOC, alleging, among other things, that the decision to terminate his employment was discriminatory and constituted illegal retaliation for his having filed the first EEOC complaint.
During trial, Rao withdrew all claims of discrimination and retaliation under Title VII except his claim that his employment was terminated because he is a native of India. The Court is bound by the jury's determination that no defendant terminated the plaintiff's employment because of a motivation to discriminate against him because he is a native of India. See Song v. Ives Lab., Inc., 957 F.2d 1041, 1048 (2d Cir.1992) ("It is clear that a judge sitting at equity may not render a verdict which is inconsistent with that of a jury sitting at law on a claim involving the same essential elements"); Wade v. Orange County Sheriff's Office, 844 F.2d 951, 954 (2d Cir.1988) (finding that when a jury determines a factual issue related to a civil rights claim, the court is precluded from reaching a contrary decision on that issue under Title VII); In re Lewis, 845 F.2d 624, 629 (6th Cir.1988) ("One important reason that a judge is not to make findings that contravene a jury's verdict is that the verdict is res judicata with respect to the factual issues which would have necessitated jury resolution"). The Court, therefore, finds that none of the defendants terminated the plaintiff's employment because of a motivation to discriminate against him because of his national origin and dismisses the plaintiff's Title VII claim with prejudice.
The foregoing constitutes the Court's findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52(a).
II.
The plaintiff seeks prejudgment interest on the $100,000 award of compensatory damages. Section 1983 contains no provision regarding prejudgment interest. The parties agree that when a federal statute is silent concerning the availability of prejudgment interest, a court may award prejudgment interest in accord with its equitable discretion. In Wickham Contracting Co., Inc. v. Local Union No. 3, Int'l Bhd. of Elec. Workers, 955 F.2d 831 (2d Cir.), cert. denied, ___ U.S. ___, 113 S.Ct. 394, 121 L.Ed.2d 302 (1992), the Court of Appeals for the Second Circuit explained the factors to be applied in making a discretionary award of prejudgment interest:
[T]he award should be a function of (i) the need to fully compensate the wronged party for actual damages suffered, (ii) considerations of fairness and the relative equities of the award, (iii) the remedial purpose of the statute involved, and/or (iv) such other general principles as are deemed relevant by the court.
Wickham, 955 F.2d at 833-34 (citations omitted).
*326 Awarding prejudgment interest on a § 1983 claim is justified in light of these factors. The purpose of the remedial scheme provided by 42 U.S.C. § 1983 is to fully compensate individuals for harm suffered as a result of a constitutional violation. Prejudgment interest is usually a necessary component of any award intended to make a plaintiff whole, because it compensates a plaintiff for delay in the receipt of relief. Consequently, prejudgment interest is generally appropriate in § 1983 actions. It is especially appropriate in employment termination situations where a plaintiff has been deprived of wages. Clarke v. Frank, 960 F.2d 1146, 1153-54 (2d Cir.1992) ("Prejudgment interest discourages an employer from attempting to `enjoy an interest-free loan for as long as [it can] delay paying out back wages.' ... Thus, we have held that `it is ordinarily an abuse of discretion not to include pre-judgment interest in a back-pay award.'")
In Frank v. Relin, 851 F.Supp. 87, 91 (W.D.N.Y.1994), the court granted the plaintiff prejudgment interest on an award of back pay under § 1983, finding that:
Plaintiff is entitled to prejudgment interest here for the same reasons others who have been terminated on account of discrimination have been awarded prejudgment interest.... Plaintiff has been without her lost pay for several years because of the discriminatory acts of defendant. The purpose of back pay is to make her whole and that can only be accomplished if she receives compounded, prejudgment interest. An award of prejudgment interest is necessary to fully compensate plaintiff, is not inequitable and would not create a windfall for plaintiff.
Frank, 851 F.Supp. at 91.
Citing the fourth Wickham factor, that the court may rely on general principles it deems to be relevant when deciding whether to award prejudgment interest, the defendants argue that awarding prejudgment interest in this case would violate the general principle that an award of prejudgment interest should not result in over-compensation of the plaintiff. See Wickham, 955 F.2d at 834. The defendants argue that an award of prejudgment interest would result in a windfall to the plaintiff, because it is likely that a portion of the jury's $100,000 award is not properly subject to an award of prejudgment interest.
The jury was instructed as follows regarding the calculation of damages:
Should you decide that the plaintiff has proved his claim, you must award the plaintiff such sum of money as you believe will fairly and justly compensate him for any injury which you believe he actually sustained as a direct consequence of the unconstitutional act in question.
You should award actual damages only in an amount to compensate him for those injuries which you find the plaintiff has proved by a preponderance of the evidence. Moreover, you should award actual damages only for those injuries which have been proved to be a direct result of conduct by the defendant that violated Section 1983. That is, you may not simply award actual damages for any injury suffered by the plaintiff you must award actual damages only for those injuries that are a direct result of actions by the defendant you are considering and that violated the plaintiff's constitutional rights protected under Section 1983.
Actual damages must not be based on speculation or sympathy. They must be based on the evidence presented at trial, and only on that evidence.
The plaintiff also claims mental suffering and damage to his reputation as components of his damages. Although mental suffering and damage to reputation can never be measured precisely, the lack of a measuring device should not prevent the award of damages provided that those damages may reasonably be determined from the preponderance of the evidence.
The defendants argue that prejudgment interest is not appropriate on awards for emotional distress or lost Employment benefits other than back pay. The only authority cited by the defendants for this proposition is Miner v. City of Glens Falls, 999 F.2d 655 (2d Cir.1993), a case in which the Court of Appeals for the Second Circuit upheld the district court's grant of prejudgment interest *327 on an award of back pay. The district court did not grant prejudgment interest on damage awards for emotional distress and lost pension benefits and the court of appeals did not address its refusal to do so. Thus, the opinion does not stand for the proposition that it is inappropriate to grant prejudgment interest on such awards.
In the present case, it is clear from all of the testimony that all or virtually all of the compensatory damages represent compensation for the plaintiff's lost wages. The plaintiff was earning approximately $50,000 a year prior to his termination in March, 1987. The most reasonable and understandable explanation for the jury's award is that it found that the plaintiff should be compensated for two years of lost wages, but no more. There was almost no testimony about the plaintiff's emotional distress. Moreover, on the basis of all the credible testimony, there is no reason to believe that the jury would have awarded Rao substantially less than two years of back pay, given that he has been unemployed for approximately seven years after being terminated in violation of his First Amendment rights. The jury may have limited Rao's damages to two years of wages as a result of finding either that he failed to mitigate his damages or that HHC had not proximately caused his inability to be able to find work two years after his termination.
It is equitable to award the plaintiff prejudgment interest on the entire damage award, because the entire award, or virtually all of it, is compensation for lost wages. Indeed, it would be inequitable to withhold prejudgment interest on the ground that some portion of the damage award may have been intended to compensate the plaintiff for emotional distress or lost benefits. The parties expressly agreed during trial, before the jury was charged, that the issue of prejudgment interest both with respect to entitlement and with respect to amount would be left to the Court. The defendants cannot now argue that prejudgment interest should be denied because the jury did not specifically allocate the amount of lost wages. See Frank, 851 F.Supp. at 89-91 (holding that a court may award prejudgment interest under § 1983 when the issue has not been presented to the jury and that the Wickham factors warranted an award of prejudgment interest, because "[p]laintiff was deprived of money that she otherwise would have earned but for defendant's violation of her First Amendment rights").
For the foregoing reasons, the Court finds that an award of prejudgment interest on the $100,000 award of compensatory damages is warranted. Prejudgment interest is necessary to make the plaintiff whole, to avoid unfairness, and to accomplish the purposes of the statute. The defendants admit that this award is within the Court's discretion and acknowledge that their arguments in opposition to the award were intended only to inform the exercise of the Court's discretion and not to challenge the propriety of awarding prejudgment interest.
III.
The rate of prejudgment interest is also a matter that is committed to the court's discretion. See Chandler v. Bombardier Capital Inc., 44 F.3d 80, 84 (2d Cir.1994); Frank, 851 F.Supp. at 91 ("In general, district courts have discretion in deciding what interest rate to use in awarding prejudgment interest. The Second Circuit has not expressly endorsed any particular prejudgment interest rate") (citation omitted). Courts have used a variety of interest rates, including both statutory and market rates. See, e.g., Frank, 851 F.Supp. at 91 (collecting cases). 28 U.S.C. § 1961(a) provides that the federal post-judgment interest rate shall be equal to the one year Treasury bill rate at the time of judgment.[3] Because there is no reason that a greater or lesser interest rate should be used to calculate prejudgment interest, *328 than to calculate post-judgment interest, the Treasury bill rate is a reasonable rate to use for an award of prejudgment interest. See Frank, 851 F.Supp. at 91 (applying the rate specified in 28 U.S.C. § 1961(a) to calculate prejudgment interest). To account fairly for the considerable fluctuations in the Treasury bill rate, it is appropriate to calculate prejudgment interest according to the average rate over the period for which interest is to be awarded. See McIntosh v. Irving Trust Co., 873 F.Supp. 872, 883 (S.D.N.Y.1995) ("Using the average rate provides the plaintiff with an amount that he could have obtained on a relatively safe investment while taking into account the effect of inflation and the fluctuation in the rate over the long period of time involved. It accomplishes the goal of making the plaintiff whole.") (citations omitted).
The defendants argue that any award of prejudgment interest in this case should be calculated at the rate of 3%, as specified in New York Unconsolidated Laws § 7401(5) (McKinney 1994), which states, with respect to HHC, that, "Except as hereinafter provided in this subdivision, the rate of interest to be paid by the corporation upon any judgment or accrued claim against the corporation shall not exceed three per centum per annum." The defendants have represented that HHC will indemnify the liable defendants and that therefore § 7401(5) is applicable.
The defendants do not argue that the Court is bound to apply the 3% interest rate in § 7401(5), but argue only that the Court should take that rate into account in exercising its discretion to set an appropriate rate of prejudgment interest. Given that the liability of the defendants is predicated on a federal civil rights statute and that the Court has discretion in setting the rate, § 7401(5) does not provide a basis for using a rate of prejudgment interest other than the average Treasury bill rate.
In any event, it does not appear that § 7401(5) is applicable to the facts of this case. In Ebert v. New York City Health and Hosp. Corp., 82 N.Y.2d 863, 631 N.E.2d 105, 609 N.Y.S.2d 163 (1993), the New York Court of Appeals held that prejudgment interest at a rate in excess of 3% may not be awarded against an individual defendant whom HHC is required to indemnify under law. The court explained:
Since NYCHHC must indemnify its officers and employees pursuant to General Municipal Law § 50-k and since any judgment payable under that provision shall be payable from the public moneys of the corporation (McKinney's Uncons. Laws of N.Y. § 7401[6], added by L.1979, ch. 673, § 9), NYHHC stands in place of its employee, Doctor Escano. Ultimately NYHHC cannot escape payment of the judgment at issue against Doctor Escano and, thus, becomes by operation of law the real party in interest, obligated to pay only the 3% interest. The otherwise affirmed judgment against Doctor Escano should bear that lower rate of interest.
Ebert, 82 N.Y.2d at 866-67, 631 N.E.2d at 106, 609 N.Y.S.2d at 164. Ebert makes clear that the reason the statute does not allow an award of prejudgment interest in excess of 3% against a defendant whom HHC must indemnify is that, in such circumstances, HHC is the real party in interest by operation of law.
New York General Municipal Law § 50-k, which requires indemnification of city employees in some situations, provides that:
The city shall indemnify and save harmless its employees in the amount of any judgment obtained against such employees in any state or federal court, or in the amount of any settlement of a claim approved by the corporation counsel and the comptroller, provided that the act or omission from which such judgment or settlement arose occurred while the employee was acting within the scope of his public employment and in the discharge of his duties and as not in violation of any rule or regulation of his agency at the time the alleged damages were sustained; the duty to indemnify and save harmless prescribed by this subdivision shall not arise where the injury or damage resulted from intentional wrongdoing or recklessness on the part of the employee.
New York General Municipal Law § 50-k. Section 50-k does not require the city to *329 indemnify employees when an injury results from intentional wrongdoing. In Ebert, the employee's wrongdoing was a result of malpractice. In the present case, defendants Japha, Newman, and Weigand were held liable for an intentional violation of constitutional rights. Thus, it is not apparent that HHC has a duty to indemnify them or that HHC is the real party in interest by operation of § 50-k so that § 7401(5) would apply.
The parties have agreed that any award of prejudgment interest should be calculated on the full award from the date on which the first of the consolidated suits was filed, April 21, 1989, to the present. This agreement avoids the need to determine the amounts on which interest accrues by attempting to determine the period for which the award was intended to compensate the plaintiff and by spreading it out over that period. Cf. McIntosh, 873 F.Supp. at 883-84. The parties have further agreed that interest is to be compounded annually[4] and that if the post-judgment Treasury bill rate specified in 28 U.S.C. § 1961(a) is to be used to calculate prejudgment interest, the appropriate rate is 5.4%, which the parties represent as the average rate for one year Treasury bills for the years 1989-1994. The Court finds that 5.4% is a fair and equitable rate, and is therefore appropriate.
IV.
The plaintiff seeks reinstatement to a position comparable to that from which he was terminated or, alternatively, an award of front pay. Reinstatement is generally recognized to be an appropriate remedy for wrongful termination, because it serves the general purpose of making the plaintiff whole. See, e.g., Standley v. Chilhowee R-IV School District, 5 F.3d 319, 321-22 (8th Cir. 1993) (finding that reinstatement normally follows a finding of § 1983 liability for nonrenewal of a teaching contract); Reeves v. Claiborne County Bd. of Educ., 828 F.2d 1096, 1101 (5th Cir.1987) ("Reinstatement is ... normally an integral part of the remedy for a constitutionally impermissible employment action") (citations omitted).[5]
The defendants argue that reinstatement is not appropriate because defendants Japha and Newman are no longer employed by HHC and do not have authority to rehire the plaintiff and because defendant Weigand, though still employed by HHC, lacks authority as well. The defendants also argue that to order HHC to reinstate the plaintiff would be contrary to the jury's finding that, under the Monell doctrine, HHC was not liable for the plaintiff's unconstitutional termination. See Monell, 436 U.S. 658, 98 S.Ct. 2018. The defendants are correct that any order to reinstate the plaintiff would wrongfully impose equitable relief on HHC.
Regardless of defendant Weigand's authority to rehire the plaintiff at HHC, reinstatement is inappropriate, because Weigand was not found to be liable in his official capacity. The Supreme Court explained the difference between personal capacity suits and official capacity suits in Kentucky v. Graham, 473 U.S. 159, 105 S.Ct. 3099, 87 L.Ed.2d 114 (1985):
Personal-capacity suits seek to impose personal liability upon a government official for actions he takes under color of state law. See, e.g., Scheuer v. Rhodes, 416 U.S. 232, 237-238, 94 S.Ct. 1683, 1686-1687, 40 L.Ed.2d 90 (1974). Official-capacity suits, in contrast, "generally represent only another way of pleading an action against an entity of which an officer is an agent." Monell v. New York City Dept. of Social Services, 436 U.S. 658, 690, n. 55, 98 S.Ct. 2018, 2035, n. 55, 56 L.Ed.2d 611 (1978). As long as the government entity receives *330 notice and an opportunity to respond, an official-capacity suit is, in all respects other than name, to be treated as a suit against the entity. Brandon [v. Holt], supra, 469 U.S. [464], at 471-472, 105 S.Ct. [873], at 878 [83 L.Ed.2d 878 (1985)]. It is not a suit against the official personally, for the real party in interest is the entity. Thus, while an award of damages against an official in his personal capacity can be executed only against the official's personal assets, a plaintiff seeking to recover on a damages judgment in an official-capacity suit must look to the government entity itself.
Graham, 473 U.S. at 165-166, 105 S.Ct. at 3105 (footnote omitted); see also Hafer v. Melo, 502 U.S. 21, 23-27, 112 S.Ct. 358, 361-62, 116 L.Ed.2d 301 (1991) ("Because the real party in interest in an official-capacity suit is the governmental entity and not the named official, `the entity's `policy or custom' must have played a part in the violation of federal law'") (quoting Graham quoting Monell). In Graham, the Supreme Court also noted that there is no longer a need to bring official capacity suits against local government officials because under Monell local government units can be sued directly for damages and injunctive or declaratory relief. Graham, 473 U.S. at 166 n. 14, 105 S.Ct. at 3106 n. 14. In this case, HHC was, in fact, named as a defendant.
In Graham, the Court instructed that the course of the proceedings will typically indicate the nature of the liability personal or official sought to be imposed on an individual. Although defendant Weigand was named as a defendant in both his personal and official capacities, the jury's verdict demonstrates that he was found to be liable only in his personal capacity. In Graham, the court explained that in order for an individual to be liable in his or her official capacity under § 1983, the liability of the municipality must be established under Monell:
On the merits, to establish personal liability in a § 1983 action, it is enough to show that the official, acting under color of state law, caused the deprivation of a federal right. See, e.g., Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961). More is required in an official-capacity action, however, for a governmental entity is liable under § 1983 only when the entity itself is a "`moving force'" behind the deprivation, Polk County v. Dodson, 454 U.S. 312, 326, 102 S.Ct. 445, 454, 70 L.Ed.2d 509 (1981) (quoting Monell, supra, 436 U.S., at 694, 98 S.Ct., at 2037); thus, in an official-capacity suit the entity's "policy or custom" must have played a part in the violation of federal law. Monell, supra; Oklahoma City v. Tuttle, 471 U.S. 808, 817-818, 105 S.Ct. 2427, 2433, 85 L.Ed.2d 791 (1985); id., at 827-828, 105 S.Ct., at 2437, 2438 (Brennan, J., concurring in judgment).
Graham, 473 U.S. at 166-67, 105 S.Ct. at 3105-06 (footnote omitted). Since the jury found that HHC was not liable under Monell because the plaintiff's termination was not pursuant to a policy, custom, or practice of HHC, Weigand cannot be liable in his official capacity. A finding that Weigand is liable in his official capacity would be a finding that HHC is liable, a finding which the jury found was not warranted.
Those courts that have specifically considered the issue of reinstatement have found reinstatement to be appropriate only where, unlike the situation here, an individual defendant is liable in his official capacity where, in other words, the liability is against the government entity. See, e.g., Swanson v. Martwick, 726 F.Supp. 210, 210 (N.D.Ill. 1989) ("[D]efendant Richard J. Martwick was found liable only in his individual capacity. In that capacity, Martwick does not have the authority to reinstate [plaintiff] Swanson"). An order of reinstatement is an equitable remedy that may be directed only at liable individuals in their official capacities or at municipal entities themselves. See Frank v. Relin, 1 F.3d 1317 (2d Cir.) ("The [district] court apparently viewed the reinstatement claim, sua sponte, as one to which Relin's defense of qualified immunity was applicable. However, such equitable relief could be obtained against Relin only in his official, not his individual, capacity; and a defense of qualified immunity may properly be raised only with respect to claims asserted against a defendant in his individual capacity") (emphasis *331 added), cert. denied ___ U.S. ___, 114 S.Ct. 604, 126 L.Ed.2d 569 (1993).[6]
To order reinstatement here would be contrary to Monell which found that a municipal entity should only be liable when the unconstitutional actions were pursuant to a policy, custom, or practice, which was not the case here. Such a result would in effect simply impose vicarious liability on HHC, which the Supreme Court in Monell expressly prohibited. See Monell, 436 U.S. at 691-95, 98 S.Ct. at 2036-38.
The plaintiff cites Conklin v. Lovely, 834 F.2d 543 (6th Cir.1987), in support of his argument that a court can order reinstatement when an individual defendant is liable in his or her individual capacity for a plaintiff's unconstitutional termination although no individuals are liable in their official capacities nor is the municipal employer liable. Conklin is inapposite. The liable defendants in that case argued that they were without authority to reinstate the plaintiff. The court rejected this argument, finding that under state law the defendants had authority to appoint the plaintiff because they were "coemployers" with the county, which the defendants had argued possessed exclusive authority to reinstate the plaintiff. Thus, in that case, the court found that in order to reinstate the plaintiff it was not necessary to issue an order to the county or to the individual defendants in their official capacities as agents of the county, because an order directed to the individual defendants in their capacities as "coemployers" would be sufficient. In this case, there has been no allegation that Weigand possesses the unusual authority to act as a coemployer with HHC.[7] Indeed, HHC argues that Weigand does not have the unilateral authority to hire Rao. In addition, Conklin was decided before the Supreme Court's decision in Graham and did not address the relevance of Monell to the issue of reinstatement.[8]
V.
When reinstatement is impracticable, a court has discretion to consider whether a plaintiff should receive an award of front pay to compensate for continuing harm resulting from an unconstitutional termination. Front pay is an equitable remedy that may be awarded in the court's discretion. Standley v. Chilhowee R-IV School District, 5 F.3d 319, 322 (8th Cir.1993). In Whittlesey v. Union Carbide Corp., 742 F.2d 724 (2d Cir. 1984), the Court of Appeals for the Second *332 Circuit held, in a case brought under the Age Discrimination in Employment Act of 1967, that:
In many cases involving unlawful compulsory retirement the plaintiff can be made whole through an award of back pay coupled with an order of reinstatement.... Reinstatement, however, may not always be possible. For example, there may be no position available for plaintiff at the time of judgment, or, as was the case here, the employer-employee relationship may have been irreparably damaged by animosity associated with the litigation.
Denial of reinstatement in those situations, without an award of reasonable, offsetting compensation, would leave the plaintiff irreparably harmed in the future by the employer's discriminatory discharge, and would permit the defendant's liability for its unlawful action to end at the time of judgment. To prevent this injustice a reasonable monetary award of front pay is necessary as "equitable relief ... appropriate to effectuate the purposes of [the act]." 29 U.S.C. § 626(b).
Whittlesey, 742 F.2d at 728; see also Frank, 851 F.Supp. at 93-96.
The purpose of an award of front pay is to compensate a plaintiff for continuing harm resulting from a wrongful termination. Consequently, front pay is not appropriate when a plaintiff has been fully compensated for all compensable injuries resulting from the defendants' wrongful actions: "After a jury finds § 1983 liability in a loss-of-employment case, the court must attempt to make the plaintiff whole, yet the court must avoid granting the plaintiff a windfall." Standley, 5 F.3d at 322; see also McKnight v. General Motors Corp., 973 F.2d 1366, 1369-1372 (7th Cir.1992) (upholding denial of front pay because, inter alia, "the court could have found that the sting of discrimination had ended by the time of trial"), cert. denied ___ U.S. ___, 113 S.Ct. 1270, 122 L.Ed.2d 665 (1993); Barbano v. Madison County, 922 F.2d 139, 146-47 (2d Cir.1990) (upholding denial of front pay because a finding that the plaintiff had already been made whole was within the district court's discretion); EEOC v. General Lines, Inc., 865 F.2d 1555, 1564-65 (10th Cir.1989) (upholding district court's denial of front pay and court's finding that jury's award of back pay, "although substantially less than that sought," provided full compensation).
The defendants assert that the jury's compensatory damage award of $100,000 was intended to compensate the plaintiff in large measure for back pay, but for no more than two years' worth given that the plaintiff was earning approximately $50,000 per year. The defendants argue that the jury refused to award the plaintiff any further back pay, even though he was terminated more than seven years before the trial, because it concluded either that the plaintiff would not have continued to be employed at HHC for more than two years or that the plaintiff could have obtained comparable employment within two years, but failed adequately to mitigate his damages.[9]
The plaintiff argues that the jury's failure to provide further back pay was a result of its finding other causes for his inability to find work for which the defendants were not liable, such as bad recommendations by other employers. Evidence was introduced at trial of other lawsuits and complaints by Rao against former employers who employed him prior to his employment at HHC and prospective employers from whom he sought work after his employment at HHC. In *333 these lawsuits and complaints, Rao alleged that the employers had hindered his efforts to seek employment after his termination from HHC.
Whatever the theory that the jury relied upon, it is clear, given the instructions, that the jury awarded an amount of damages that was sufficient to compensate the plaintiff fully for the actual damages attributable to the defendants' conduct. The jury made an award sufficient to make the plaintiff whole. In determining the equitable relief of front pay, I also conclude that the jury's award was sufficient to make the plaintiff whole and that any further award would have the effect of overcompensating the plaintiff, resulting in a windfall to him.
The most reasonable view of the evidence and of the jury's verdict is that the plaintiff should have obtained another position within two years and that he failed reasonably to mitigate his damages. While the plaintiff testified to having sent out numerous job applications, even for lesser paying jobs and jobs in other geographic areas, he produced little documentation verifying these efforts. Also, he testified that he knew of only a few prospective employers who had actually contacted HHC, and, at his deposition, he did not recall that any agents of prospective employers had ever said that they had spoken to anyone at HHC. It would also be reasonable for the jury to have found that the plaintiff would not have continued in his position for more than two years, because there was credible testimony by the defendants regarding the plaintiff's inability to work effectively with others. If the jury found either that the plaintiff failed to adequately mitigate his damages or that he would have been unlikely to remain employed at HHC for more than two years, then front pay would not be appropriate, because it would result in the over-compensation of the plaintiff.
Even if the jury took into account that the plaintiff's efforts to find employment were hindered by the fact that other former employers refused to give him recommendations or actively hindered his efforts to find new employment, that does not mean that the defendants should pay the plaintiff more to make him whole. The jury was charged to find the amount of money necessary to make the plaintiff whole for the actual damages proximately caused by the unconstitutional conduct. After seven years even taking into account that others may have contributed to the plaintiff's failure to be able to obtain a job the award of two years of pay was sufficient to make the plaintiff whole.
Any award of front pay would result in the overcompensation of the plaintiff and is therefore inappropriate. See Standley, 5 F.3d at 322; Barbano, 922 F.2d at 146-47 (upholding district court's refusal to grant reinstatement or front pay on the ground that, "on this record the denial was tantamount to stating that the relief actually awarded was sufficient to make Barbano whole"). Front pay is only appropriate when a plaintiff continues to suffer uncompensated harm from wrongful termination. In this case, there is no reasonable interpretation of the jury's verdict that is consistent with the assumption that the plaintiff is continuing to suffer harm from the defendants' wrongful conduct. I find that an award of front pay would be inequitable in this case and would overcompensate the plaintiff rather than make him whole.
VI.
The plaintiff has requested a letter of reference from HHC indicating that he was unconstitutionally terminated from his employment there. Equitable relief is appropriate from the individual defendants to assure that other employers do not deny the plaintiff work on the basis of his termination from HHC. Cf. Smith v. Secretary of the Navy, 659 F.2d 1113, 1122 (D.C.Cir.1981) (upholding injunctive relief requiring purging of discriminatory records from personnel file). The parties shall cooperate in the preparation of letters of recommendation in which defendants Japha, Newman, and Weigand will accurately describe the qualifications of the plaintiff. If the parties are unable to agree upon such letters within twenty days, the parties should submit their respective proposals to the Court.
*334 VII.
For the foregoing reasons, the plaintiff's requests for reinstatement or front pay are hereby denied and the plaintiff's application for prejudgment interest is granted. The plaintiff's request for a letter of recommendation is granted to the extent explained in this opinion.
SO ORDERED.
NOTES
[1] Defendant Jo Ivey Boufford was dismissed from the action prior to trial.
[2] Section 1983 provides in relevant part that:
Every person who, under color of any statute, ordinance, regulation, custom, or usage of any State ... subjects, or causes to be subjected, any citizen of the United States ... to the deprivation of any rights, privileges or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.
42 U.S.C. § 1983.
[3] Section 1961(a) provides that:
Interest shall be allowed on any money judgment in a civil case recovered in a district court.... Such interest shall be calculated from the date of the entry of the judgment, at a rate equal to the coupon issue yield equivalent (as determined by the Secretary of the Treasury) of the average accepted auction price for the last auction of fifty-two week United States Treasury bills settled immediately prior to the date of the judgment....
28 U.S.C. § 1961(a).
[4] See Saulpaugh v. Monroe Community Hosp., 4 F.3d 134, 145 (2d Cir.1993) (holding failure to compound interest on Title VII back pay award was an abuse of discretion, because compounding interest was the only way to make the plaintiff whole), cert. denied, ___ U.S. ___, 114 S.Ct. 1189, 127 L.Ed.2d 539 (1994).
[5] See also, Jeffries v. Harleston, 21 F.3d 1238 (2d Cir.) (finding that reinstatement is an appropriate remedy under § 1983 for an unconstitutional termination in violation of First Amendment rights when there is irreparable injury and the plaintiff's injury outweighs any detriment to the public from reinstatement), cert. granted and judgment vacated on other grounds, ___ U.S. ___, 115 S.Ct. 502, 130 L.Ed.2d 411 (1994), reversed on other grounds, 52 F.3d 9 (2d Cir.1995).
[6] See also, Littlejohn v. Rose, 768 F.2d 765 (6th Cir.1985) ("[T]he qualified immunity defense only protects the superintendent in his individual capacity from money damages, not from other forms of relief sought such as reinstatement.... Accordingly, the availability of qualified immunity that would enable an individual defendant to escape individual liability for money damages would not warrant the dismissal of claims against that defendant in his official capacity or against a governmental entity"), cert. denied 475 U.S. 1045, 106 S.Ct. 1260, 89 L.Ed.2d 570 (1986); Patton v. Conrad Area School Dist., 388 F.Supp. 410, 418 (D.Del.1975) (holding, prior to Monell, that "the only defendants who can be ordered to reinstate a plaintiff and have the power to do so are individual defendants in their official capacities") (citations omitted); O'Brien v. Galloway, 362 F.Supp. 901, 906 (D.Del.1973) (refusing to dismiss claim for reinstatement against individuals in their official capacities, but dismissing claim for reinstatement against defendants in their individual capacities, because, "As individuals, Galloway and Hanna are powerless to reinstate O'Brien. It is only in their capacities as Police Commissioner and Mayor, respectively, that they possibly could effect such relief").
[7] The plaintiff also relies on Carrero v. New York City Housing Authority, 890 F.2d 569 (2d Cir. 1989), for the proposition that the court can order a municipal entity to reinstate a plaintiff when its employee agents have unconstitutionally terminated him or her. There, the court held that the district court's order of reinstatement was proper, because the employer was liable under Title VII for quid pro quo sexual harassment by virtue of the actions of one of its agents. Carrero, 890 F.2d at 579. However, the court specifically noted that § 1983 provided no remedy against the authority, but only against the individual agent-defendant, because the agent's actions were not attributable to a municipal practice or policy. Id. at 576-77.
[8] Because this Court should not order reinstatement, for the reasons explained above, it is not necessary to reach the defendants' additional arguments that reinstatement would not be feasible due to HHC's current plans of reorganization which have allegedly curtailed the number of positions at HHC and due to alleged hostility between HHC and the plaintiff.
[9] The jury was charged as follows on mitigation of damages:
Even if you find that the plaintiff was injured as a natural consequence of conduct by the defendants in violation of his constitutional rights, you must determine whether the plaintiff could thereafter have done something to lessen the harm that he suffered. The burden is on the defendants to prove, by a preponderance of evidence, that the plaintiff could have lessened the harm that was done to him, and that he failed to do so. If the defendants convince you that the plaintiff could have reduced the harm done to him but failed to do so, the plaintiff is entitled only to damages sufficient to compensate him for the injury that he would have suffered if he had taken appropriate action to reduce the harm done to him. You should reduce any amount of damages that you find by the amount that the defendants prove by a preponderance of the evidence that the plaintiff could have lessened his damages. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/568006/ | 944 F.2d 500
22 Bankr.Ct.Dec. 86, Bankr. L. Rep. P 74,291,15 UCC Rep.Serv.2d 1037
In re BERING TRADER, INC.; Kemp Pacific Fisheries, Inc., Debtors.PHILIP MORRIS CAPITAL CORPORATION, formerly known as PhilipMorris Credit Corporation, Appellant,v.BERING TRADER, INC., William Friedhoff, Jr., Trustee of theBering Trader, Inc., Bankruptcy Estate; ThomasHansen, Trustee of the Kemp PacificFisheries, Inc. BankruptcyEstate, Appellees.
No. 90-35870.
United States Court of Appeals,Ninth Circuit.
Argued and Submitted Aug. 1, 1991.Decided Sept. 10, 1991.
George E. Frasier, Riddell, Williams, Bullitt & Walkinshaw, Seattle, Wash., for plaintiff-appellant/cross-appellee.
Kristi M. Wallis, Culp, Guterson & Grader, Seattle, Wash., for defendants-appellees.
Appeal from the Ninth Circuit Bankruptcy Appellate Panel.
Before WRIGHT, BEEZER and WIGGINS, Circuit Judges.
EUGENE A. WRIGHT, Circuit Judge:
1
In this case we examine the scope of section 552 of the Bankruptcy Code, 11 U.S.C. § 552. In particular, we consider whether a prepetition security interest in accounts, general intangibles and proceeds may extend to rents received postpetition under a vessel subcharter. The Bankruptcy Appellate Panel (BAP) affirmed the bankruptcy court's judgment that Philip Morris Credit Corporation's prepetition security interest did not extend to such postpetition rents. We affirm.I
2
The debtors are Bering Trader, Inc. (BTI) and Kemp Pacific Fisheries, Inc. (KPF). BTI owned the vessel M/V BERING TRADER and chartered it to KPF's parent company, Kemp Pacific Enterprises, Inc. The parent company then sub-chartered it to KPF.
3
In June of 1988, Philip Morris Credit Corporation (PMCC) provided KPF and BTI, among others, with a $2.4 million term loan and a revolving credit line up to $8.5 million. As collateral, the debtors executed a security agreement granting PMCC a first priority security interest in assets, accounts, general intangibles and all proceeds. PMCC perfected its security interest by filing the requisite financing statements.
4
The debtors, owing about $6.5 million to PMCC, filed Chapter 11 bankruptcy petitions on April 3, 1989. On April 18, 1989, the bankruptcy court authorized the charter of the vessel from BTI to Veco.1 The order reserved the rights of all parties to the rents receivable under the Veco charter.
5
In July 1989, the debtors initiated an adversary proceeding to determine the rights of the parties, including PMCC, to the rents due under the charter. On cross-motions for summary judgment, the bankruptcy court held for the debtors. It ruled that PMCC's security interest did not extend to the Veco charter or its rents. The BAP affirmed, holding that section 552(a) of the Bankruptcy Code cut off, at the time of debtors' Chapter 11 filing, PMCC's security interest in rents due under a vessel charter.
II
6
Section 552(a) states the general rule that a prepetition security interest does not extend to property acquired by the estate after the filing of the petition.2 Section 552(b) provides an exception for some proceeds, product, offspring, rents or profits of encumbered property.3 PMCC argues that it had a prepetition security interest in rents that should extend to postpetition rents under section 552(b).
7
The 552(b) exception applies to proceeds, product, offspring, rents or profits of encumbered property acquired postpetition if: (1) the parties entered into a security agreement before the bankruptcy filing; and (2) the security interest extends to prepetition property of the debtor and to proceeds, product, offspring, rents or profits of such property.
8
Even where rents are derived from a lease entered into after the filing, they may be subject to a security interest if the requirements of section 552(b) are met. See In re Oliver, 66 B.R. 426, 428-29 (Bankr.N.D.Tex.1986). The BAP determined that PMCC did not meet the requirements of section 552(b) because the security agreement did not cover rents.
9
The nature and extent of security interests are determined by state law.4 See In re Bumper Sales, Inc., 907 F.2d 1430, 1437 (4th Cir.1990). PMCC argues vigorously that rents were indeed covered by its security interest. Under Wash.Rev.Code § 62A.9-106, any right to payment under the charter of a vessel is an account. It is undisputed that PMCC's security interest covered all accounts. It argues that because a security interest in rents is incorporated in a security interest in accounts, the requirements of section 552(b) have been satisfied.
10
We must consider this argument in light of the purpose of section 552. Section 552(a) is intended to allow a debtor to gather into the estate as much money as possible to satisfy the claims of all creditors. See In re Transportation Design & Technology, 48 B.R. 635, 640 (Bankr.S.D.Cal.1985); see also Matter of Village Properties, 723 F.2d 441, 444 (5th Cir.) (section 552 was intended to apply in cases where value of collateral is increased), cert. denied, 466 U.S. 974, 104 S.Ct. 2350, 80 L.Ed.2d 823 (1984). Section 552(b) balances the Code's interest in freeing the debtor of prepetition obligations with a secured creditor's rights to maintain a bargained-for interest in certain items of collateral. It provides a narrow exception to the general rule of 552(a). In re Transportation Design, 48 B.R. at 641; In re Lawrence, 41 B.R. 36, 37-38 (Bankr.D.Minn.), aff'd, 56 B.R. 727 (D.Minn.1984).
11
Had there been prepetition rents payable, they would have been considered accounts under U.C.C. § 9-106 and covered by the security agreement as "accounts." This does not mean, however, that a security interest in accounts is the same as a security interest in rents for purposes of section 552(b).
12
The omission of the term "accounts" from section 552(b) is significant. Section 552(b) clearly contemplates an exception where the parties have bargained for an interest in one of the five types of property listed therein. PMCC asks that we find a specific and intended security interest in rents from a security interest that covers accounts.
13
To accept PMCC's argument would require the court to expand section 552(b) to include security interests in accounts. As the BAP noted correctly, "accounts" is a very broad term which encompasses any right to payment. See Wash.Rev.Code § 62A.9-106. Each of the excepted types of property enumerated in section 552(b) is derivative. That is, it necessarily derives from the sale, exchange or other dispensation of other encumbered property. Accounts are not necessarily derivative. Accounts could include, for example, a right to payment for services rendered. The inclusion of such a broad term within the purview of section 552(b) would result in the exception swallowing the rule. To meet the narrow 552(b) exception for an item of derivative collateral, the secured party must clearly articulate a security interest in that collateral.
III
14
We conclude that the appellant's security agreement does not contain language that clearly articulates an intended security interest in rents for purposes of section 552(b). The judgment that Philip Morris does not have a security interest in postpetition rents is AFFIRMED.
1
Veco proposed to use the vessel as quarters for workers at the site of the oil spill near Valdez, Alaska. Because Veco would accept a charter only from the vessel's true owner, the order authorized BTI, rather than KPF, to charter the vessel
2
11 U.S.C. § 552(a) provides:
Except as provided in subsection (b) of this section, property acquired by the estate or by the debtor after the commencement of the [bankruptcy] case is not subject to any lien resulting from any security agreement entered into by the debtor before the commencement of the case.
Under U.C.C. § 9-204(1), security agreements can extend to property acquired by the debtor after the execution of the security agreement. Section 552(a) cuts after-acquired property clauses off at the date of bankruptcy except in the limited cases described in section 552(b).
3
11 U.S.C. § 552(b) provides, in pertinent part:
[I]f the debtor and an entity entered into a security agreement before the commencement of the case and if the security interest created by such security agreement extends to property of the debtor acquired before the commencement of the case and to proceeds, product, offspring, rents, or profits of such property, then such security interest extends to such proceeds, product, offspring, rents, or profits acquired by the estate after the commencement of the case to the extent provided by such security agreement and by applicable nonbankruptcy law, except to any extent that the court, after notice and a hearing and based on the equities of the case, orders otherwise.
4
The agreement provided that New York law will govern, but the parties and the BAP cite to the Washington version of the Uniform Commercial Code. Because the relevant provisions of the two are identical, we refer to the Washington sections | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/1603526/ | 8 So.3d 1137 (2009)
LASHLEY
v.
STATE.
No. 1D09-0273.
District Court of Appeal of Florida, First District.
May 14, 2009.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603739/ | 882 F.Supp. 34 (1995)
Robert THOMAS, Plaintiff,
v.
DUNDEE RACEWAY PARK, INC., Defendant.
No. 93-CV-963.
United States District Court, N.D. New York.
April 14, 1995.
Smyk, Smyk & Fahrenz, Binghamton, NY, for plaintiff (Stephen D. Smyk, of counsel).
Kenneth J. McGuire, Jr., Spring Valley, NY, for defendant.
*35 MEMORANDUM-DECISION and ORDER
HURD, United States Magistrate Judge.
I. INTRODUCTION.
The plaintiff has moved to dismiss the Fifth and Seventh affirmative defenses raised by the defendant in its answer. The defendant has cross-moved for summary judgment dismissing the complaint. The motions were submitted to the court without oral argument.
II. FACTS.
The defendant is the owner and operator of an automobile racetrack located in Dundee, New York. On August 30, 1991, the plaintiff paid an entrance fee which allowed him admission to the racetrack and to the pit area. On payment of the fee, he also signed a "Release and Waiver of Liability and Indemnity Agreement" which provided in part:
IN CONSIDERATION of being permitted to enter for any purpose any RESTRICTED AREA (herein defined as including but not limited to the racing surface, pit areas, infield, burn out area, approach area, shut down area and all walkways, concessions and other areas appurtenant to any area where any activity related to the event shall take place), or being permitted to compete, officiate, observe, work for, or for any purpose participate in any way in the event ...
(Pl.'s No. Mot.Ex. 2.) Also, prior to that evening, the plaintiff had become a member of Empire Super Sprints, Inc. ("ESS") which included a membership contract that provided in part that the signor "[r]elease, waive, discharge, and promise not to sue the ESS, [or] any of its officials, [or] any of its members, any of its sponsors...." Id. Ex. 1. The defendant was a sponsor of the racing events which occurred on October 30, 1991. Plaintiff's son participated in the events as a race car driver.
During the course of the evening, the plaintiff was allegedly injured while in the pit area when a race car caused a large rock or other debris from the racetrack to strike him in the face. As a result, he sustained the personal injuries which are the subject of this action.
III. DISCUSSION.
In the Fifth affirmative defense, the defendant alleges that it is not liable by reason of the "Release and Waiver of Liability and Indemnity Agreement" signed by the plaintiff upon entering the premises. In the Seventh affirmative defense, the defendant alleges that it is not liable by reason of the membership contract plaintiff signed with ESS.
The plaintiff moves to strike the two affirmative defenses on the basis of a New York Law which voids agreements between owners and users of places of recreation which purport to exempt the owner from liability for the owner's negligence.[1] The defendant moves to dismiss the complaint in its entirety on the basis of the two documents signed by the plaintiff prior to his accident.
The issue before the court, therefore, is whether § 5-326 applies to render the releases signed by the plaintiff unenforceable. It is clear that the racetrack is a facility which is covered by the statute. Owen v. R.J.S. Safety Equip., Inc., 79 N.Y.2d 967, 967, 582 N.Y.S.2d 998, 591 N.E.2d 1184 (1992); Green v. WLS Promotions, Inc., 132 A.D.2d 521, 521, 517 N.Y.S.2d 537 (2d Dep't 1987), appeal dismissed without op., 70 N.Y.2d 951, 524 N.Y.S.2d 678, 519 N.E.2d *36 624 (1988); Gaskey v. Vollertsen, 110 A.D.2d 1066, 1066-67, 488 N.Y.S.2d 922 (4th Dep't 1985). Thus, to resolve the issue before the court, the status of the plaintiff must be determined. If the plaintiff was a "user," then the statute is applicable, and the affirmative defenses must be stricken. On the other hand, if the plaintiff was an actual "participant" in the event, § 5-326 is not applicable, and the two documents signed by the plaintiff are enforceable and the complaint must be dismissed.
A spectator or observer who pays a fee to enter the racetrack is entitled to the protection of section 5-326. Gaskey, 110 A.D.2d at 1066-67, 488 N.Y.S.2d 922 (spectator in pit area entitled to protection); see Green, 132 A.D.2d at 521, 517 N.Y.S.2d 537. Plaintiff contends that he was merely a spectator on the night in question, thus falling under the protection of the statute.
Plaintiff supports his position by pointing to his two affidavits. First plaintiff stated that from the time he entered the racetrack until he was injured, he "observed the races from [the pit] area for approximately an hour." (Pl.'s Not.Mot. Thomas Aff. sworn Jan. 24, 1995.) Plaintiff further stated that "on the night of the accident, I was there simply to watch the race ..., and did nothing with regard to maintenance of the car." (Pl.'s Aff. sworn February 21, 1995.) "I did nothing that evening other than to stand, watch the races, and perhaps shout encouragement to my son and the other drivers." Id.
On the other hand, a participant is not a "user" under the statute and is not entitled to its protection. Lago v. Krollage, 157 A.D.2d 49, 52, 554 N.Y.S.2d 633 (2d Dep't 1990), aff'd, 78 N.Y.2d 95, 571 N.Y.S.2d 689, 575 N.E.2d 107 (1991); Howell v. Dundee Fair Ass'n, 73 N.Y.2d 804, 806, 537 N.Y.S.2d 27, 533 N.E.2d 1056 (1988). Defendant argues that the plaintiff was, as a matter of law, a member of the pit crew, and therefore not a "user."
For example, the court in Lago specifically held as a matter of law that the decedent, acting as a race car mechanic at the time he was killed, was not a "user" and was not entitled to the protection of the statute. 157 A.D.2d at 52, 554 N.Y.S.2d 633. The Court of Appeals, deciding the appeal on other grounds, stated that it need not consider whether the plaintiff was a "user." 78 N.Y.2d at 101, 571 N.Y.S.2d 689, 575 N.E.2d 107.
In Howell, the plaintiff was at the raceway solely as a volunteer fire and ambulance crew member. 73 N.Y.2d at 805, 537 N.Y.S.2d 27, 533 N.E.2d 1056. The court found that plaintiff was not a "user" under the statute, and therefore the release was valid and enforceable. Id. at 806, 537 N.Y.S.2d 27, 533 N.E.2d 1056. The parties also rely on Owen, in which the court held that the statute was applicable and the release was not enforceable. 79 N.Y.2d at 969, 582 N.Y.S.2d 998, 591 N.E.2d 1184. However, in that case the claim that the decedent, as a professional race car driver, was a "user" within the meaning of the statute was not raised before the trial court. Thus, a reading of the statute and the applicable cases leads to the conclusion that if the plaintiff was an active member of the pit crew, he would have been a participant and not a "user," and would not be entitled to the benefits of the statute.
In attempting to establish that the plaintiff was an active member of the pit crew, the defendant points to plaintiff's sworn testimony at an examination before trial and the affidavits of two raceway employees.
In the first place, the issue is the plaintiff's status on the night of the accident. A careful reading of the plaintiff's deposition reveals that he admitted being a member of his son's pit crew on many occasions over a period of years. However, there is no admission by the plaintiff that he was acting as a member of the pit crew on the night in question.[2]
*37 The fact that the plaintiff worked as a member of his son's pit crew frequently over a long period of time is certainly evidence from which one might conclude that he was acting as a member of the pit crew on the night in question. Such evidence would be admissible and relevant not only as to the issue of the plaintiff's comparative negligence or awareness of the dangers of being in the pit crew, but also on the issue as to his credibility that he was merely acting as a spectator and cheerleader that night. Any inference made from that evidence, however, would be permissive rather than required.
Second, the employees' affidavits submitted by the defendant are inconclusive. The affidavit of Judy Olevnik states that she "personally observed Plaintiff take an active part in the operation of that car on that night and on other nights." (Def.'s Not. Cross-Mot. Olevnik Aff. sworn Feb. 8, 1995 (emphasis added).) This merely is a conclusion with no details and has no evidentiary value. The affidavit of Charles "Chuck" Miller merely states that he "observed Plaintiff taking an active part in the operation of his son's race car as a crew member at several ESS events." (Def.'s Not. Cross-Mot. Miller Aff. sworn Feb. 8, 1995.) Again, this provides no details, nor is it specific to the night in question.
The status of the plaintiff on August 30, 1991, will determine whether or not the release and membership applications bar his claims against the defendant. If he was merely an observer or spectator, the documents are void and unenforceable. If he was a participant as a pit crew member, the documents are valid and enforceable and the claim must be dismissed. Neither side has presented sufficient evidence for this court to determine as a matter of law the status of the plaintiff. This issue must be decided at the time of trial. Therefore, all motions are denied.
Therefore, it is
ORDERED that
1. Plaintiff's motion to dismiss the Fifth and Seventh affirmative defenses is DENIED; and
2. Defendant's motion for summary judgment is DENIED.
IT IS SO ORDERED.
NOTES
[1] The New York law provides in part:
Every covenant, agreement or understanding in or in connection with, or collateral to, any contract, membership application, ticket of admission or similar writing, entered into between the owner or operator of any ... place of amusement or recreation, or similar establishment and the user of such facilities, pursuant to which such owner or operator receives a fee or other compensation for the use of such facilities, which exempts the said owner or operator from liability for damages caused by or resulting from the negligence of the owner, operator or person in charge of such establishment, or their agents, servants or employees, shall be deemed to be void as against public policy and wholly unenforceable.
N.Y.Gen.Oblig.Law § 5-326 (McKinney 1989).
[2] The following answers to question were given by plaintiff at the examination before trial on May 11, 1994.
Q. How long have you been a crew member on your son's car?
A. Since he started.
Q. How long is that?
A. He started in 1987, I believe.
Q. Is there more than one crew member on the car?
A. Yeah.
Q. What's your primary function as a crew member on the car?
A. Nothing really. I'm just there for encouragement.
Q. You time the car, laps, keep records of that stuff?
A. Yeah. Yeah. I have a stopwatch. We keep track of time.
(Pl.s Not.Mot.Ex. D. at 5-6.). See also id. at 6-8 for plaintiff's testimony regarding his son's other crew members and their duties, and plaintiff's participation as a crew member on other cars. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2591697/ | 5 N.Y.2d 24 (1958)
St. Regis Tribe of Mohawk Indians, by Norman Tarbell et al., Individually as Duly Enrolled Members and as Duly Elected Chiefs of the St. Regis Tribe of Indians, on Behalf of All St. Regis Indians, Appellants,
v.
State of New York, Respondent. (Claim No. 32879.)
Court of Appeals of the State of New York.
Argued May 14, 1958.
Decided June 25, 1958.
William H. Quimby, Jr., and Arthur B. Hart for appellants.
Louis J. Lefkowitz, Attorney-General (Paxton Blair, Donald C. Glenn and Julius L. Sackman of counsel), for respondent.
Thomas F. Moore, Jr., and Edward L. Ryan for Power Authority of the State of New York in support of respondent's position.
Chief Judge CONWAY and Judges DESMOND, DYE, FULD, VAN VOORHIS and BURKE concur.
*27FROESSEL, J.
Plaintiffs are the duly elected chiefs of the St. Regis Tribe of the Mohawk Indians, and have instituted this action on behalf of all the members of the tribe. Their claim is that the State of New York has appropriated, pursuant to title 1 of article 5 of the Public Authorities Law, certain *28 "land, bed of St. Lawrence River, and water rights, including inherent and intrinsic water power in such river * * * to which the claimants allege original title which has never been extinguished". Claimants assert "immemorial rights arising prior to white occupation, consisting of immemorial possession and use including original title to those rights which are the subject of the appropriation by the State of New York".
In order to ascertain the basis of the claim of the St. Regis Tribe to the land in question, it is necessary to review the relevant historical background. Prior to the Treaty of Paris entered into at the conclusion of the Revolutionary War, the St. Regis Indians used and occupied land on both sides of the St. Lawrence River, as well as islands in the river, among which is one subsequently known as Barnhart's Island. This island, to which the St. Regis Tribe here claims title, contains 1,692 acres. In 1783 the United States and Great Britain entered into the Treaty of Paris (8 U. S. Stat. 80-83), in article II of which it was provided that the part of the northern boundary of the United States here relevant should be "along the middle of" the St. Lawrence River.
This boundary did not provide a satisfactory guide for the ascertainment of sovereignty over various islands located in the river. With respect to Barnhart's Island, the record shows that more than nine tenths of the water of the river flowed on the southeasterly side of the island; that a large portion of the island is north of the 45th degree of north latitude (one of the boundaries); that the branch of the river between the island and Canada "could sometimes in the lowest water be forded * * * [and] was never navigable for boats drawing over two feet of water [while] * * * any vessels navigating the upper lakes, can always navigate the channel between the Island and Massena".
Thus it is not surprising that after the 1783 treaty Great Britain governed Barnhart's Island, and that it was treated as a part of the township of Cornwall, the inhabitants of said island being taxed by Canada, and serving military duty at Cornwall. This administration of the island continued until 1821-1823.
In 1791 one Alexander Macomb applied to the Land Office of the State of New York for the purchase of a tract of land *29 in northern New York State which was to include "all the Islands belonging to this State fronting the said Tract in * * * the river St. Lawrence". The surveyor general who was to survey the area covered by the application reported to the Governor: "As it is uncertain which Islands in the River St. Lawrence fall on the New York side of the Line established by Treaty between the United States and the British Government none of those contained in the Contract with Mr. Macomb are comprehended in the above Return". On March 3, 1795, letters patent for this part of the Macomb tract were issued to one Daniel McCormick, to whom rights were transferred by Alexander Macomb.
In May, 1796 the State of New York entered into a treaty with tribes of Indians denominating themselves as the Seven Nations of Canada. In that treaty the tribes, including the St. Regis Tribe, agreed to "cede, release and quit claim to the people of the State of New York forever All the Claim Right or Title of them * * * to Lands within the said State Provided nevertheless that the Tract equal to six miles square reserved in the sale made by the Commissioners of the Land Office of the said State to Alexander Macomb to be applied to the use of the Indians of the Village of St. Regis shall still remain so reserved". Compensation in addition to the six square mile tract was provided to be paid to the Seven Nations or Tribes of Indians "for the extinguishment of their Claim to all Lands within the State".
In 1806, and again a year later, the question as to which islands in the St. Lawrence River were covered by the letters patent issued to McCormick was brought before the Land Office and the Legislature, the result of which was a request to the Governor "to adopt and pursue such measures as may be deemed most advisable for effecting the determination and establishment of a line of territory and jurisdiction between this state and the British government on lake Ontario and the river St. Lawrence." These efforts did not afford McCormick the desired relief, so he asked in 1814 that, until the boundary line was settled, a survey should be made to show which of the islands were "indisputably within the limits of this state". In 1817, having obtained only one island in the St. Lawrence, he sold his rights to the remaining islands to David Ogden.
*30In the meantime, following the War of 1812, and in December, 1814, the United States and Great Britain entered into the Treaty of Ghent (8 U. S. Stat. 218-223). Article Sixth of said treaty provided: "Whereas, by the former treaty of peace that portion of the boundary of the United States * * * was declared to be `along the middle of said river * * *.' And whereas doubts have arisen what was the middle of the said river, lakes and water communications, and whether certain islands lying in the same were within the dominions of his Britannic majesty or of the United States: In order, therefore, finally to decide these doubts, they shall be referred to two commissioners * * *. The said commissioners shall, by a report or declaration * * * designate the boundary * * * in conformity with the true intent of the said treaty of one thousand seven hundred and eighty-three." Article Eighth in effect stated that the rights of the Indians are not to be affected by the resettling of the boundary. On June 18, 1822, the commissioners made their report (8 U. S. Stat. 274-277), in which they decided that Barnhart's Island belonged to the United States.
We here note that in a report made by a committee of the New York State Assembly in 1850 it was stated: "It appears to your committee that prior to the settlement of the boundary line under the Treaty of Ghent, Long Island, at the outlet of Lake Ontario, lying between Cape Vincent in Jefferson County, and Kingston in Upper Canada, was claimed by both the British and American authorities, and that they exercised concurrent jurisdiction over the same. That the settlement of said boundary line, as a compromise and by way of remuneration for the claims of the United States to the said Long Island, Great Britain gave up Barnhart's Island to the United States. Your committee are fully satisfied that Barnhart's Island was ceded to the United States by way of compromise and exchange and not by virtue of the treaty of 1783."
Likewise in 1856, an Assembly committee stated: "That the commissioners, in retracing the boundary line between the United States and the British Provinces, under the Treaty of Ghent, in 1822, exchanged these two islands [Baxter and Barnhart] for others in the St. Lawrence river, and they were thereby declared to be within the jurisdiction of the United States."
*31In 1823 David Ogden applied for and received a patent from the State of New York covering Barnhart's Island as well as others in the St. Lawrence River. At this point, then, title to Barnhart's Island would appear to be vested in Ogden.
We now turn to the conduct of the St. Regis Tribe with respect to Barnhart's Island. In 1795 the tribe gave a lease of the whole island to George Barnhart for 999 years at an annual rental of $30. In 1806 the Indians renegotiated the lease, increasing the amount of the rental to $60 per year and shortening the term to 99 years. In March, 1817 the lease was again renegotiated, the amount of the annual rental further increased to $150. There is evidence in the record that "The Indian lease to Barnhart was recognized by the British government as conferring title according to its terms". Rents were collected from the tenants by officials of the Canadian Government from 1804 to 1822. Thus in 1823 when the State of New York issued letters patent for Barnhart's Island, that island was occupied by tenants who had substantially improved property thereon.
Shortly after the letters patent were issued to David Ogden, he instituted an ejectment suit against the then occupants. In the 1850 report of the committee of the Assembly, it was stated: "Upon the trial, the defendants offered their Indian title in evidence, but the court held that they could not look behind the patent of the State, but were bound to recognize the sovereignty of the State, and its patents. Judgment of ouster was therefore had against the defendants. They were then forced to purchase of the Messrs. Ogden, or abandon their farms. The Ogdens charged them the full value of the land with their improvements added; thus compelling them to pay for what their own labor and money had accomplished." There was evidence that the entire island was sold to John Barnhart in 1826 for $11,434.75, but that he defaulted in payments.
In 1843 the Commissioners of the Land Office of the State of New York, to whom a petition of the St. Regis Indians "for a conveyance to them of certain islands in the River St. Lawrence, or an equivalent in money" was referred, reported: "the State of New-York has been the owner of the fee to these islands since the treaty of 1783; that they as early as the year 1791, exercised acts of ownership over the same by an actual *32 contract of sale; that such claim of title has been uninterrupted by the repeated recognition of the validity of such original contract of sale up to the time of the execution of the same; that the delay of such execution upon the part of the State was in no manner induced by a want of confidence of the State to the title to these islands, but from the difficulty of ascertaining the true lines of territory and jurisdiction between the State of New-York and the British Provinces; that in the year 1796, `The Seven Nations of Canada' whom the petitioners would claim to represent, by a solemn treaty then made and ratified, quit-claimed all their right and title to all lands located in the State of New York; by means of which, the whole title of such Indians to any lands within this State became forever extinguished, except to such small portion in such treaty reserved for the use in such treaty expressed.
"The commissioners of the Land-Office are of the opinion that the title to these tribes was not the less extinguished by the treaty of 1796, which was a general quit-claim of title to all lands within the State from the fact that the lines of boundary beween this State and the British Provinces had not been definitely settled, and considering the character and object of the reservation made in such treaty, the reference therein to the contract made with Macomb in 1791 for the description of such reservation, and that the representatives of this original contract were parties to this treaty, they are no less satisfied that such general extinguishment of title is equally within the spirit as the letter of such treaty. The Commissioners of the Land-Office are therefore of the opinion that the petitioners have neither in law or equity the least claim to the relief sought in their petition."
In direct conflict with the views above expressed was a report of an Assembly committee on claims made by George Barnhart for compensation in 1850. That committee impliedly referred to the 1843 report of the Land Office Commissioners when it said: "It was for a long time contended in the case of Asa Baxter, who held Baxter's Island in the St. Lawrence until 1823, under precisely the same circumstances as are here narrated, that the State acquired the title to that island by a treaty made with the Indians in 1796. It is presumed that the State patented the island now in question under the same claim. *33 The legislature of 1847, however, repudiated the claim of the State to Baxter's island under the Indian treaty of 1796, and appointed commissioners to appraise his damages by reason of his eviction by the Ogdens. An act for the payment of the award of the commissioners has passed both houses at the present session. The claim of petitioners is a more strong one if possible than that of Baxter. While his island was found to be within the limits of this State by the boundary as established by the treaty of 1783, and consequently within the letter of the Indian treaty of 1796, Barnhart's island only became the property of this State by the treaty of Ghent." An act was passed authorizing the appointment of commissioners, and the commissioners reported a total amount of damages of $6,597. That report stated that the title of the Barnharts was "derived in the first instance from an Indian lease * * * which lease was recognized as valid by the proper authorities of Canada". They also appear to have recognized that the fee interest characterized as "a remote reversion at the end of nine hundred and ninety-nine years" was in the Indians.
In January, 1851 the Commissioners of the Land Office submitted a report to the Assembly dealing with the rights of the St. Regis Tribe in relation to Barnhart's Island. They there stated:
"The Commissioners have no peculiar means of knowing whether the two islands were within the jurisdiction of the United States before the treaty of Ghent, but it is fair to assume from the instructions to Mr. Ogden, the surveyor, that they were not included. * * *
"If the lands fell within the jurisdiction of the United States by the line established under the treaty [of Ghent], the Commissioners are clearly of the opinion that the State had no right to make any grant to the Ogdens, by which the Indians were deprived of any rents or advantages, without making compensation."
The report then continued to state the facts relating to the leasing of the island by the Indians to the Barnharts, and it concluded that if the existence of these leases could be shown, "the Commissioners entertain no doubt that justice and good faith to the Indians require the State to pay to them an annuity *34 equal to the annual amount of rent. * * * It is probable that the Legislature will be called upon to pay a large amount of damages under the appraisal by the commissioners."
The report of the Committee on Indian Affairs made in 1856 stated: "The committee regard the title of the said Indians to said islands as unquestioned. * * * The justice and propriety of the above appropriations [to the Barnharts and to Baxter] was fully and elaborately discussed and conclusively shown * * *. The rights of the lessee cannot well be sanctioned and respected without, at the same time, sanctioning the title of the lessor. This proposition is too plain to the comprehension of the most indifferent mind, to require elaboration by the committee.
"It has long been the avowed, as well as the practical policy of this State, at least to deal justly by the remaining remnant of the aboriginal inhabitants of this country. We are their guardians, they our wards. We are increasing, they fast decreasing, in numbers and estate.
"In any view which the committee can take of the subject referred, they can see no good reason why an appropriation should not be made to the petitioners equal to the annual rents from 1822 to this time, together with a sum which, put at interest at the rate of 6 per cent, would produce the rents reserved; or a sum which in 1822 would have extinguished the Indian title to said islands, with interest thereon from that time, which, by the proofs, would have been $1,000 for each island
Being ................................................... $2,000
Add interest at 6 per cent for 33 years ................. 3,960
______
$5,960
Or thus:
The rents, at $120 per year for 33 years ................ $3,960
To which add $1,000 for each island, as commutation
for title and rent ...................................... 2,000
______
$5,960"
In April, 1856 an Act authorizing the grant of said $5,960 "for the payment and in full of the claim of the St. Regis tribe of Indians, for the sale by the State of two certain islands in the *35 river St. Lawrence, known as Barnhart's and Baxter's islands, which belonged to the said tribe", was passed by the Legislature. The Act further stated:
"The above sum shall be paid by the treasurer, on the warrant of the comptroller, out of any money in the treasury not otherwise appropriated, to the order of Southerland Colquhoun, the agent of the British portion of the St. Regis tribe of Indians, and William A. Dart, of Potsdam, in the county of St. Lawrence, to be by them distributed to the said tribe * * *
"The said Southerland Colquhoun and William A. Dart shall before receiving any portion of the sum hereby appropriated, execute and file in the office of the comptroller of this state, a bond".
The ledger of the Comptroller indicates that on April 30, 1856 $5,960 was paid out to "St. Regis Indians, in full of their claim for the sale by the State of two Islands in the River St. Lawrence, known as Barnhardt's & Baxter's Is.". An affidavit in the record indicates that a search of the records of the Department of Audit and Control has failed to locate (1) any bond executed by Colquhoun and Dart; (2) an account to the Comptroller of the appropriation of the said $5,960, or any vouchers relating to the distribution of that sum.
The situation remained thus, with the Indians asserting no claim to title to the island until after the State appropriated it for the development of a power project, after which the present claim for $33,800,000 was made. The State moved to dismiss the claim on the grounds that (1) it did not state a cause of action; (2) claimants lacked legal capacity to sue the State of New York; (3) there was an incurable defect of parties, and (4) any claim which had existed had been released. The Court of Claims denied the motion, finding that there were triable issues of fact on the first and last grounds. The Appellate Division reversed on the ground that the Indians had no legal title to the real property in question, and that in any event the record showed that they had released whatever claim they had.
On this appeal, the State concedes that the claimants have capacity to sue, and they do not argue that there is a defect of indispensable parties. They do contend that (a) the treaty of 1796 divested claimants of title to Barnhart's Island; (b) the payments by the State in 1856 put an end to any liability which *36 the State may ever have incurred, and (c) any lingering right in the Indians after 1856 was at most a right of occupancy, which the Supreme Court of the United States has held to be not compensable in appropriation proceedings. The St. Regis Tribe argues that the right, title and interest to Barnhart's Island is still in them, and that compensation for that property interest is mandated by the New York State Constitution.
We turn now to the first of the two grounds urged in this court as a basis for dismissal of the claim, to wit, that it is legally insufficient. This point having been raised by a motion under subdivision 4 of rule 106 of the Rules of Civil Practice, we may not consider matters beyond the face of the complaint except insofar as we may take judicial notice of them by common law or by statute (Richardson on Evidence [8th ed.], § 8 et seq.; Civ. Prac. Act, § 344-a) and thereby read them into the complaint (Pfleuger v. Pfleuger, 304 N.Y. 148; Walsh v. Trustees of New York & Brooklyn Bridge, 96 N.Y. 427, 438; First Nat. Bank of Genoa v. American Sur. Co., 239 App. Div. 282, 284). Affidavits may of course not be considered (Purdy v. McGarity, 262 App. Div. 623; King v. Krischer Mfg. Co., 220 App. Div. 584). The rule is otherwise as to that phase of the motion brought under subdivision 6 of rule 107, but the facts brought to the court's attention under that rule may not be considered under subdivision 4 of rule 106 of the Rules of Civil Practice (Berwin & Co. v. American Safety Razor Corp., 282 App. Div. 922).
Considering the claim alone, then, when read in the light of relevant treaties and statutes, of which we may clearly take judicial notice, construing it liberally, and recognizing that on its challenge of the claim for legal insufficiency the State accepts as true the relevant allegations of fact and the reasonable inferences that may be drawn therefrom (Civ. Prac. Act, § 275; Garvin v. Garvin, 306 N.Y. 118, 120; Denihan Enterprises v. O'Dwyer, 302 N.Y. 451, 458; Blanshard v. City of New York, 262 N.Y. 5, 12; Dyer v. Broadway Cent. Bank, 252 N.Y. 430, 432-433), we may not say as a matter of law that no possible valid claim of title has been set forth for the reasons hereinafter stated.
Moreover, we reach the same conclusion even if we regard the official documents, such as the reports of the committees of the Legislature, as matters of which we could take judicial notice. *37 Since both parties to this litigation, as well as the Appellate Division, seem to have proceeded upon that theory, we have considered the claim in the setting of the treaties, statutes and official documents, and its historical background. So considered, the claim presents many interesting questions.
No one disputes that the St. Regis Tribe of Mohawk Indians occupied Barnhart's Island prior as well as subsequent to the Treaty of Paris in 1783, which treaty on its face seemed to allot that island (north of "the middle of" the St. Lawrence River) to the British. Was that occupancy subsequently recognized as a right of possession by the State of New York? Did the St. Regis Tribe, by the Treaty of 1796, when it ceded its lands "within the State" (excepting the six square miles reserved), intend to include said Barnhart's Island, from which they were then collecting rent through agents of the British Government? Could the Treaty of Ghent operate retroactively as of the time of the Treaty of Paris so as to extinguish any property rights of the St. Regis Tribe? What effect did the Ogden ejectment action have on the rights of the Indians, particularly in the light of the subsequent conflicting reports of the Legislative Committees? Did the Legislature of this State recognize that the Indians had rights by appropriating a sum of money therefor in 1856? To say the least, the rights of the St. Regis Tribe in Barnhart's Island prior to the time the Legislature made an award to them present triable issues upon this motion challenging the sufficiency of their claim.
It appears to be settled that the bare right of occupancy by the Indians (conveyable by them only to the State) is not the kind of property right which must, as a matter of due process, be compensated for by the State upon its taking title to Indian lands (Tee-Hit-Ton Indians v. United States, 348 U. S. 272, 279 et seq.; United States v. Tillamooks, 341 U. S. 48, 49; United States v. Santa Fe Pacific R. R. Co., 314 U. S. 339, 347; Kwash-Ke-Quon Indians v. United States, 137 U. S. Ct. Cl. 372, 373-374) unless, of course, a statute authorizes it (U. S. Code, tit. 25, § 70a; Otoe & Missouria Tribe of Indians v. United States, 131 F.Supp. 265, 283-285, cert. denied 350 U. S. 848; Upper Chehalis Tribe v. United States, 155 F.Supp. 226; cf. 69 Harv. L. Rev. 150-151).
*38The reports of the Legislative Committees, however, appear to furnish evidence of a recognition by the State of some rights on the part of the Indians in Barnhart's Island, and thus an implied expression of intent to repay them for the taking of that interest. The policy of this State, as that of others in the Union, was to deal with the original Indian nations "as proprietors of the soil which they claimed and occupied, but without the power of alienation, except to the governments which protected them * * *. These governments asserted and enforced the exclusive right to extinguish Indian titles to lands, enclosed within the exterior lines of their jurisdictions, by fair purchase, under the sanction of treaties" (3 Kent's Comm. 385 [12th ed.]). As we stated in People ex rel. Cutler v. Dibble (16 N.Y. 203, 212-213, affd. 62 U. S. 366): "They have been treated, since our first intercourse with them, as quasi independent nations or tribes, having governments and institutions and national attributes of their own; but, both collectively and individually, feeble and helpless compared with the whites, and therefore needing constantly the protection and paternal care of the government." This of course does not require that compensation must be made by the courts rather than left to the consciences of the Legislatures, but it does evidence the policy of liberal dealing with the Indians on the part of the State.
As to the second ground urged by the State, the record clearly shows that the Legislature in 1856 duly compensated the St. Regis Tribe for their claim or interest in this property. It will be recalled that the Legislature had the matter brought before it by the St. Regis Tribe, who sought "an allowance to them by the State for certain islands". The tribe was cognizant of the previous awards to Baxter and Barnhart for the value of their interest in the lands, and they demanded the same treatment, although it had been previously denied them.
The committee in the Legislature recognized that the practice of the Canadian Government when dealing with interests based upon long-term leases, such as were involved with regard to Barnhart's Island, was to "issue patents therefor to the lessees, on being paid a sum which, at an interest of 6 per cent, would produce the rents reserved". Accordingly, the committee recommended an appropriation "to the petitioners equal to the annual rents from 1822 to this time, together with a sum which, *39 put at interest at the rate of 6 per cent, would produce the rents reserved; or a sum which in 1822 would have extinguished the Indian title to said islands, with interest thereon from that time". Appellants claim that the sum appropriated was not for the purchase of the Indians' title but merely as a temporary compensation to them for loss of rentals on their lease. This contention is simply not borne out on an examination of the report of the Legislature in 1856.
It is further contended that there is no evidence that the sum appropriated was ever paid to the St. Regis Tribe, and that a search failed to reveal the bond to have been posted by the persons who were to have turned over the money to the Indians. The loss of this document is amply accounted for, in our opinion, by the statement of the deputy comptroller that such a record as this is not among those required by statute to be kept; and that it was felt that so long as there was in existence a record indicating that the payment had been made, it was unnecessary to retain this document also. In this respect, the presence in the records of the Comptroller of the entry stating that the money had been paid on April 30, 1856 to the St. Regis Indians "in full [satisfaction] of their claim" raises a presumption that such payment was made, and obligates the claimants to come forward with more than the bare assertion that the money was not so paid (Bean v. Tonnele, 94 N.Y. 381, 386; Conkling v. Weatherwax, 181 N.Y. 258, 267; Richardson on Evidence [8th ed.], § 89; see 9 Wigmore on Evidence [3d ed.], § 2517). Being so assiduous in their attempts to obtain compensation for their rights in Barnhart's Island, it may be presumed that they would show like diligence in calling to the attention of the Legislature any failure to comply with its expressed obligations.
The final point raised by claimants is that even if the 1856 payment be intended as a satisfaction of the claims of the Indians to Barnhart's Island, it cannot effect that result as it is in conflict with the Indian Intercourse Act (U. S. Code, tit. 25, § 177).
In Seneca Nation v. Christie (126 N.Y. 122), we stated (p. 142) with regard to that Act: "There is room for question whether the act of 1802 was intended to apply to treaties made by a sovereign state with tribes within the state for the extinguishment of the Indian title to lands therein". Our language in *40 that case was the basis of a holding in United States v. Franklin County (50 F.Supp. 152) to the effect that the provisions of the Indian Intercourse Act do not apply to the State of New York. No authority has been cited to us which would indicate a contrary result.
In any event, we have here the situation where the State of New York duly negotiated the Treaty of 1796 with various Indian tribes, including the St. Regis Tribe, in the presence of a Federal Commissioner. Thereafter a dispute arose over the meaning and application of the terms of that treaty. Certainly the State had the right to settle this dispute under that treaty through a legislative grant of compensation (see N. Y. Const., art. I, § 13). Thus this was not the negotiation of a new purchase of property from an Indian tribe, but rather the adjustment of a claim that had arisen as the result of the ambiguous language of the 1796 treaty.
The judgment should be affirmed, without costs.
Judgment affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3076059/ | Order entered May 30, 2014
In The
Court of Appeals
Fifth District of Texas at Dallas
No. 05-14-00258-CV
SHIELDS LIMITED PARTNERSHIP, Appellant
V.
BOO NATHANIEL BRADBERRY, ET AL., Appellees
On Appeal from the County Court at Law No. 5
Dallas County, Texas
Trial Court Cause No. CC-14-00541-E
ORDER
We GRANT the May 28, 2014 motion of Vikki Ogden, Official Court Reporter for
County Court at Law No. 5 of Dallas County, Texas, for an extension of time to file the
reporter’s record. The reporter’s record shall be filed by June 30, 2014.
/s/ ADA BROWN
JUSTICE | 01-03-2023 | 10-16-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1604187/ | 25 Wis. 2d 457 (1964)
STATE EX REL. BOULTON and others, Petitioners,
v.
ZIMMERMAN, Secretary of State, Respondent.
Supreme Court of Wisconsin.
October 6, 1964.
October 27, 1964.
*460 For the petitioners there was a brief by Dominic H. Frinzi and Nicholas C. Catania, both of Milwaukee, and oral argument by Mr. Catania.
For the respondent the cause was argued by Robert J. Vergeront, assistant attorney general, with whom on the brief were George Thompson, attorney general, and David McMillan, assistant attorney general.
PER CURIAM.
The principal issue presented is whether nomination papers can be validly circulated and filed nominating a complete slate of 12 independent presidential electors, or whether a separate nomination paper must be circulated and filed for each of the 12 nominees.
Under sec. 1, art. II, United States constitution, Wisconsin is entitled to 12 presidential electors, since 12 is the total number of our members in the United States house of representatives and senate. The names of the candidates for *461 presidential elector do not appear on the ballot but only the names of the candidates for President and Vice-President for whom the electors are pledged to vote. Sec. 9.04, Stats., provides, "A vote for the presidential and vice presidential nominees of any party is a vote for the electors of such nominees."
Established political parties, which have succeeded in nominating candidates for the legislature at the September primary, nominate their presidential electors at their state platform conventions, and such nominations are then certified to the secretary of state. Sec. 5.36, Stats. There is, however, no separate statutory provision applying to the method of nominating independent candidates for presidential electors in behalf of a party such as the Socialist Workers Party which failed to nominate candidates for the legislature at the September primary and thus does not have available to it the machinery of a platform convention by which to nominate its presidential electors. Thus the only applicable statute is sec. 5.19, which covers all independent nominations. Cf. 1 Op. Atty. Gen. (1912) 215, and 25 Op. Atty. Gen. (1936) 610, which opinions were rendered under predecessor statutes to sec. 5.19. The portions of such statute applicable to this controversy are:
"(4) ... Except as otherwise provided in this subsection nomination papers for an independent candidate to be voted for throughout the state shall be signed by at least 1,000 electors. Each candidate, whether voted for directly or indirectly, shall file with his nomination papers a declaration that he will qualify as such officer, if elected.
"(5) Each elector shall sign for only one candidate for the same office, and shall add his residence, post-office address and the date of signing." (Italics supplied.)
Because under the provisions of sec. 9.04, Stats., the voters vote for an entire slate of presidential electors, and have no opportunity to vote separately for individual candidates *462 for presidential electors, an ambiguity exists with respect to the meaning of sec. 5.19 (5), when applied to such candidates. Where, as here, there exists an ambiguity in a statute, the past practical construction over an extensive period by the officer or administrative agency charged with its administration is to be accorded great weight in determining the statute's meaning. State ex rel. City Bank & Trust Co. v. Marshall & Ilsley Bank (1959), 8 Wis. (2d) 301, 307, 99 N. W. (2d) 105; Frankenthal v. Wisconsin Real Estate Brokers' Board (1958), 3 Wis. (2d) 249, 255, 88 N. W. (2d) 352, 89 N. W. (2d) 825. Acquiescence of the legislature in the practical interpretation placed upon statutes by the administrative agency charged with their enforcement has also been held by this court to be entitled to great weight in construing ambiguous statutes. Dunphy Boat Corp. v. Wisconsin Employment Relations Board (1954), 267 Wis. 316, 326, 64 N. W. (2d) 866, and cases cited therein.
However, the past administrative practice is one of confusion. The attorney general first ruled twice that the names of all presidential electors of a political party, which resorted to the independent method of nominating candidates as prescribed by the predecessor statute to sec. 5.19, Stats., could be placed on one ballot. 1910 Op. Atty. Gen. 309, and 1 Op. Atty. Gen. (1912) 235. Subsequently the attorney general ruled that a separate nomination paper had to be circulated in behalf of each independent presidential elector. 9 Op. Atty. Gen. (1920) 436, 21 Op. Atty. Gen. (1932) 492, and 25 Op. Atty. Gen. (1936) 466. Because of these later rulings of the attorney general the secretary of state required separate nomination papers to be filed for each independent candidate for presidential elector during the period from 1920 to 1952. Then in 1952 the secretary of state permitted the Socialist Workers Party and also the Socialist Labor Party to file sets of nomination papers for presidential electors *463 on which the names of the entire slate of 12 candidates of each of these parties appeared on the same set of nomination papers. The explanation for this is afforded by the following letter of July 22, 1952:
"Mr. James E. Boulton
Socialist Workers Party
917 North Third Street
Milwaukee 3 Wisconsin
"Dear Sir:
"With reference to our letter of July 18th, we are pleased to give you the results of a conference with Attorney General Vernon Thomson regarding the printing of names of Independent candidates for president and vice president on the Wisconsin ballots.
"The Attorney General informs us that the requirements of the Statutes will be complied with by filing one set of nomination papers in behalf of all presidential electors. Therefore, the given and surname of each elector, vocation and address may be printed on one nomination paper. This eliminates the circulation of twelve different sets of nomination papers for presidential electors. This one set of nomination papers must contain the signatures, residences and post office addresses of at least one thousand electors of the state. If this method is adopted by your organization, we strongly advise the printing of the form of nomination paper in accordance with the sample enclosed. The principles, expressed in five words or less, will apply to all twelve electors.
"A separate set of nomination papers will be required for the Independent candidates for president and vice president. Each set must also contain the signatures of at least one thousand electors of the state.
"Therefore, instead of filing fourteen sets of nomination papers, as has been the practice in other years, it has been determined that three sets, providing they meet the requirements of law, will be sufficient for placing the names of Independent candidates for president and vice president on the presidential ballots of Wisconsin, at the election to be held November 4th, 1952. The deadline for filing will be September 23rd, 1952, at 5:00 o'clock P. M.
*464 "Each candidate for president, vice president and presidential elector will be required to file with the nomination papers a declaration of acceptance that he will qualify for the particular office he is seeking. Forms for this purpose are enclosed.
"Very truly yours,
"/s/ FRED R. ZIMMERMAN,
"Secretary of State"
Also in the ensuing presidential election years of 1956 and 1960 the secretary of state permitted the filing by independent party candidates for presidential elector of nomination papers wherein all 12 candidates of the party were named in each nomination paper. Thus for the last twelve years preceding 1964 the administrative practice has been in accord with the method which petitioners have now attempted to pursue and which the secretary of state contends is invalid.
To us the administrative agency practical construction followed in 1952, 1956, and 1960 is the more logical than that of the years 1920 to 1952. It is also the one which the attorney general had originally approved in 1910 and 1912. We conclude that the 12 independent presidential electors of the Socialist Workers Party constitute one composite candidate within the meaning of sec. 5.19 (5), Stats. This is because under our election statutes there is no possible way for voters to vote separately for the candidacy of one individual person for presidential elector. Therefore, respondent erred in refusing to accept the nomination papers tendered by petitioners.[1]
*465 It is our considered opinion that the nomination papers which were presented to respondent for filing on September 22, 1964, wherein the names of all 12 candidates for presidential electors were printed on these papers as nominees, did not contravene the applicable statutes, and that respondent erred in refusing to accept the filing of the same.
While respondent did not on September 22, 1964, advance, as a reason for rejecting the filing, the fact that the name and occupation of one of the candidates named in the nomination papers for presidential elector was a paste-on, he advanced this fact in his return as a justification for not having accepted the tendered finding. He contends that it is impossible to determine when this paste-on was affixed to the nomination papers so there is no way of knowing whether this occurred before or after any particular signer subscribed the papers. The executed affidavits of the circulators, however, aver that the electors signed "the foregoing nomination paper" on the date stated opposite his name. The words "the foregoing nomination paper" purportedly refer to the nomination paper with the paste-on affixed. The affidavit of the circulator creates a rebuttable presumption of regularity. Respondent would have no right to reject the filing of these nomination papers because of the paste-ons in the absence of possession of some fact tending to rebut such presumption of regularity.
Lastly, respondent's return raises the issue that there was no tender made by the individual petitioners on September 22, 1964, of their written declarations of intention to qualify if elected. The persons representing petitioners at the attempted filing on that date had these written declarations in their possession ready to file the same with respondent, but deemed it a useless gesture to tender the same after respondent refused to accept the filing of the nomination papers. *466 We determine that respondent's rejection of the tendered nomination papers excused petitioners from tendering such written declarations.
It is ordered that a peremptory writ of mandamus issue to respondent, Robert C. Zimmerman, secretary of state, commanding and directing him to do the following acts:
(1) To accept for filing in his office the nomination papers of James E. Boulton, Wayne Leverenz, Albert Stergar, Ted Odell, Myrtle C. Kastner, Betsy Stergar, Florence Kirkland, Earl Plaster, Elaine Goodreau, James Eyman, Duane Witkowski, and Lorraine Fons as candidates for presidential elector of the Socialist Workers Party, which nomination papers he rejected on September 22, 1964.
(2) To certify to all county clerks of the state of Wisconsin pursuant to sec. 6.19 (1), Stats., the names of Clifton DeBerry and Edward Shaw as candidates of the Socialist Workers Party for the offices of President and Vice-President, respectively, of the United States, in order that said county clerks may perform the duties imposed upon them by secs. 6.21 and 6.25, with respect to printing the names of said two candidates for President and Vice-President on both facsimile and regular ballots.
NOTES
[1] Whether one set of nomination papers may be circulated which names a party's independent candidates for President and Vice-President. and also the slate of 12 presidential electors pledged to such candidates, was not urged by petitioners. We, therefore, have found it unnecessary to consider the validity of such a procedure. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603532/ | 882 F. Supp. 755 (1995)
William H. LOGAN, Plaintiff,
v.
Donna E. SHALALA, Secretary of the Department of Health and Human Services, Defendant.
No. 94-3226.
United States District Court, C.D. Illinois, Springfield Division.
March 30, 1995.
*756 *757 Donald J. Hanrahan, Lauren J. Pashayan, Land of Lincoln Legal Assistance Foundation Inc., Springfield, IL, for plaintiff.
James A. Lewis, U.S. Atty., Springfield, IL, for defendant.
ORDER
EVANS, United States Magistrate Judge:
This cause is before the Court on Plaintiff's motion, pursuant to 42 U.S.C. § 405(g) and 42 U.S.C. § 1383(c)(3), for review of a final decision rendered by the Secretary of Health and Human Services ("Secretary") finding him not disabled and consequently not entitled to supplemental security income. Plaintiff requests a reversal of the Secretary's decision or, in the alternative, a remand for another hearing. For the reasons stated hereafter, Plaintiff's motion is denied.
STATEMENT OF THE CASE AND PRIOR PROCEEDINGS
Plaintiff applied for SSI on June 15, 1990, November 6, 1990, and February 26, 1992. Each application was denied initially and upon reconsideration. Plaintiff then requested a hearing before an Administrative Law Judge (ALJ). On January 13, 1994, a hearing was held in Springfield, Illinois. Plaintiff, represented by an attorney, testified along with a vocational expert. On February 19, 1994, the ALJ concluded that Plaintiff was not disabled and consequently, not entitled to supplemental security income. On June 20, 1994, the ALJ's decision became the final decision of the Secretary when the Appeals Council denied Plaintiff's request for review.
LAW AND STANDARD OF REVIEW
In order to be entitled to disability insurance benefits, Plaintiff must show that his inability to work is medical in nature and that he is totally disabled. Disability benefits are meant only for "sick" persons and are not intended to be a surrogate unemployment insurance or a welfare program. Thus, economic conditions, personal factors, financial considerations, and attitudes of employers are irrelevant in determining whether Plaintiff is eligible for disability benefits. See 20 C.F.R. § 404.1566.
Establishing disability under the Social Security Act is a two-step process. First, Plaintiff must be suffering from a medically determinable physical or mental impairment, or combination of impairments, which can be expected to result in death or which have lasted or can be expected to last for a continuous period of not less than 12 months. 42 U.S.C. §§ 423(d)(1)(A), 1382c(a)(3)(A) (Supp. 1994); 20 C.F.R. § 416.905(a). Second, there must be a factual determination that the impairment renders the Plaintiff unable to engage in any substantial gainful employment. McNeil v. Califano, 614 F.2d 142, 143 (7th Cir.1980). That factual determination is made using a five-step test. See 20 C.F.R. § 416.920. The steps are examined in order as follows:
1. Is the Plaintiff presently unemployed?
2. Is the Plaintiff's impairment "severe?"
3. Does the impairment meet or exceed one of a list of specified impairments?
4. Is the Plaintiff unable to perform his former occupation?
5. Is the Plaintiff unable to perform any other work within the national economy?
An affirmative answer at any step leads either to the next step, or on steps 3 and 5 to a finding that the Plaintiff is disabled. A negative answer at any point, other than step 3, stops the inquiry and leads to a determination that the Plaintiff is not disabled. Garfield v. Schweiker, 732 F.2d 605, 607 n. 2 (7th Cir.1984). Plaintiff has the burden of production and persuasion on steps 1-4. Once the Plaintiff shows inability to perform past work, however, the burden shifts to the Secretary to show ability to engage in some other type of substantial gainful employment. Tom v. Heckler, 779 F.2d 1250, 1253 (7th Cir.1985); Halvorsen v. Heckler, 743 F.2d 1221, 1225 (7th Cir.1984).
*758 The Court's function on review is not to try the case de novo or to supplant the ALJ's findings with the Court's own assessment of the evidence. Pugh v. Bowen, 870 F.2d 1271, 1274 (7th Cir.1989). The Court must only determine whether the ALJ's findings were supported by substantial evidence and whether the proper legal standards were applied. Delgado v. Bowen, 782 F.2d 79, 82 (7th Cir.1986). In determining whether the ALJ's findings were supported by substantial evidence, the Court must consider whether the record, as a whole, contains "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Richardson v. Perales, 402 U.S. 389, 401, 91 S. Ct. 1420, 1427, 28 L. Ed. 2d 842 (1971). Credibility determinations made by the ALJ will not be disturbed unless such findings are "patently wrong." Luna v. Shalala, 22 F.3d 687, 690 (7th Cir.1994).
DISCUSSION AND ANALYSIS
Plaintiff was thirty-six years of age at the time of the ALJ's decision. He alleged disability due to drug and alcohol dependence and a fractured right ankle. In arriving at her conclusion that Plaintiff was not disabled for purposes of receiving supplemental security income, the ALJ determined, among other things, that Plaintiff was presently unemployed, his impairments did not meet or exceed one of the listed impairments, he had no prior relevant work experience, and there were a significant number of jobs in the national economy which he could perform.
Plaintiff offers two arguments in support of his motion. Although it is difficult to ascertain from Plaintiff's memorandum, it appears Plaintiff first attacks the ALJ's determination that his impairments did not meet or exceed one of the listed specified impairments (step 3 of the five-part test). Next, Plaintiff argues that the ALJ erred by relying on the vocational expert's testimony (step 5 of the five-part test). Plaintiff's arguments will be addressed in turn.
I
Although it is difficult to determine since Plaintiff's memorandum is not entirely clear, it appears Plaintiff argues that the medical evidence supports the conclusion that he suffers from two of the listed impairments specifically, an organic mental disorder (20 C.F.R. Pt. 404, Subpt. P, App. 1, Listing 12.02) and a personality disorder (Listing 12.08).[1] His argument is primarily based on the findings of Kenneth Imhoff ("Imhoff"), an examining psychologist. After examining Plaintiff, Imhoff diagnosed an organic mental disorder and a personality disorder which, if accepted by the ALJ, would entitle Plaintiff to supplemental security income. However, the ALJ decided against adopting Imhoff's conclusions. Consequently, the ALJ concluded that Plaintiff's impairments failed to meet or exceed any of the listed impairments.
A. Organic Mental Disorder (Listing 12.02)
An organic mental disorder is a psychological or behavioral abnormality associated with a dysfunction of the brain. 20 C.F.R. Pt. 404, Subpt. P, App. 1, Listing 12.02. Generally, "history and physical examination or laboratory tests demonstrate the presence of a specific organic factor judged to be etiologically related to the abnormal mental state and loss of previously acquired functional abilities." Id. In order to establish the presence of such an impairment, the claimant must satisfy several requirements. Pursuant to part B of Listing 12.02, the claimant's condition must result in two of the following:
1. Marked restriction of activities of daily living; or
2. Marked difficulties in maintaining social functioning; or
3. Deficiencies of concentration, persistence or pace resulting in frequent failure to complete tasks in a timely manner (in work settings or elsewhere); or
4. Repeated episodes of deterioration or decompensation in work or work-like settings *759 which cause the individual to withdraw from that situation or to experience exacerbation of signs and symptoms (which may include deterioration of adaptive behaviors).
20 C.F.R. Pt. 404, Subpt. P, App. 1, Listing 12.02B.[2] If the claimant's condition fails to meet two of the four criteria of part B, he is presumptively not disabled for the purposes of Listing 12.02.
According to Imhoff's mental capacity evaluation, Plaintiff's condition failed to meet either criterion one or two of part B.[3] (Transcript pg. 345). Thus, Plaintiff's condition must meet both criterion three and four in order to be presumptively disabling under Listing 12.02 (assuming part A is also satisfied).
Regarding criterion four, the mental capacity evaluation form submitted to Imhoff (apparently drafted by Plaintiff's attorney) asked for an "estimate" of the episodes of deterioration or decompensation. (Transcript pg. 346). In response, Imhoff circled the words "marked" and "extreme." (Transcript pg. 346). However, the ALJ disregarded Imhoff's conclusion. We agree with the ALJ's reasoning discrediting Imhoff's evaluation.
First, when determining if a claimant's condition meets criterion four, the medical examiner is not asked to provide an estimate of future episodes (or for that matter an estimate of past episodes), rather, the examiner is required to support his conclusion with specific instances of "deterioration or decompensation." Once the specific instances are identified, the claimant does not meet criterion four unless such instances can be characterized as "repeated episodes."[4] Thus, by providing an estimate instead of specific episodes of deterioration or decompensation, Imhoff's conclusion is misleading and potentially inaccurate.
The evaluation form was defective in another respect. Imhoff was directed (apparently by Plaintiff's attorney) to analyze Plaintiff's condition regarding criterion four by circling the word "none," "slight," "moderate," "marked," or "extreme." Yet, as evidenced by 20 C.F.R. § 404.1520a(b)(3), when rating a claimant's degree of functional limitation under criterion four the ALJ is required to employ a scale utilizing the terms "never," "once or twice," "repeated," and "continual." Thus, Imhoff's report did not even utilize the proper terminology.
Consequently, since Imhoff failed to identify specific episodes of deterioration or decompensation, but instead apparently provided an estimate (utilizing improper terminology) of future episodes, we agree with the ALJ finding his conclusion unreliable and misleading. Plaintiff, citing Washington v. Shalala, 37 F.3d 1437, 1441 (10th Cir.1994), argues that Imhoff's conclusion nevertheless constitutes as substantial evidence under criterion four. We concede that Washington appears to support Plaintiff's position. However, based on our research, in every case that we could locate (with of course the exception of Washington) discussing criterion four, the respective discussion concerned specific, identifiable episodes of deterioration or decompensation. See, e.g., Young v. Secretary of Health and Human Services, 957 F.2d 386, 391 (7th Cir.1992) (Acknowledging that "Council held that [the claimant] did not suffer deterioration ... because there were no documented instances of deterioration-related episodes reported in the record."); Weikert v. Sullivan, 977 F.2d 1249, 1253 (8th Cir.1992) (Acknowledging that "the ALJ found that [the claimant] had experienced episodes of deterioration or decompensation in work or work-like settings once or twice, which is not considered disabling under the listings."); Lankford v. Sullivan, 942 F.2d 301, 307 (6th Cir.1991); Burnicks v. Shalala, *760 No. 93-C-4722, 1994 WL 87323, U.S.Dist. LEXIS 3085 (N.D.Ill. March 16, 1994) ("The ALJ's findings regarding deterioration and decompensation are supported by substantial evidence" since the claimant "failed to show that she repeatedly had episodes of deterioration or decompensation prior to the March 13, 1992 onset date."); Young v. Sullivan, No. 1 91-C-7703, 1992 WL 212588, U.S.Dist. LEXIS 13074 (N.D.Ill. August 27, 1992) ("[T]he ALJ disagreed with the doctors' evaluation because there was no evidence presented of episodes of work related stress and resulting deterioration...."). With the exception of Washington, we are not aware of a single case that supports Plaintiff's position.
The Court acknowledges Plaintiff's problem regarding criterion four. That is, due to Plaintiff's sparse employment history,[5] it would be difficult to identify repeated episodes of deterioration or decompensation in work or work-like settings. See Figueroa-Rodriguez v. Secretary of Health and Human Services, 845 F.2d 370, 373-74 (1st Cir. 1988). In other words, due to limited experience in work-like settings or environments, criterion four arguably penalizes individuals like Plaintiff by requiring "repeated episodes" of deterioration or decompensation. Nevertheless, there is no indication that criterion four was intended to be interpreted as broadly as Plaintiff suggests.[6]
Thus, since the plain language of criterion four implicitly requires identifiable episodes of deterioration or decompensation and virtually every case that we could locate discusses or analyzes criterion four by referring to specific episodes of deterioration or decompensation, we decline to interpret criterion four as broadly and expansively as Plaintiff suggests. Consequently, since Plaintiff bases his claim for relief entirely on Imhoff's report and Imhoff's conclusion regarding criterion four is invalid, Plaintiff has failed to satisfy his burden that he suffers from a listed impairment.[7] Thus, Plaintiff is presumptively not disabled. And, since there were several medical examiners who concluded that Plaintiff did not suffer from a mental impairment, the ALJ's decision finding Plaintiff not disabled is supported by substantial evidence.
Since Plaintiff has failed to satisfy his burden regarding part B of Listing 12.02, our discussion regarding Plaintiff's argument that he suffers from an organic mental disorder could end right here. However, we would like to comment on several other issues raised by Plaintiff. The following discussion assumes that Imhoff's evaluation was not defective, i.e., that Imhoff validly diagnosed an organic mental disorder.
In concluding that Plaintiff did not suffer from an organic mental disorder the ALJ notably relied on the opinions of other medical examiners. For instance, Dr. Terry Brelje, a psychologist, after asking Plaintiff a series of questions and administering a standardized intelligence test (the WAIS-R), stated that "no mental illness was observed." *761 (Transcript pg. 294). Dr. Brelje ultimately concluded that Plaintiff had "an ongoing problem with alcohol abuse." (Transcript pg. 295). Similarly, Dr. Obul Reddy, a psychiatrist, after administering a "mental status examination," concluded that Plaintiff had a "significant history of alcohol and drug abuse dependence and addiction" but did not otherwise have "any other identifiable psychiatric problem." (Transcript pg. 291). Plaintiff was also examined by Gorden H. Ford, a licensed clinical psychologist. Following Plaintiff's evaluation, Ford opined that his results were "consistent with the previous psychiatric and psychological evaluations" finding "a long-term abuse of both alcohol and drugs, borderline cognitive intellectual ability with little evidence of significant short-term or long-term memory difficulties, and an absence of significant personality or emotional disturbance." (Transcript pg. 298). Finally, the ALJ noted that Plaintiff's long-term treating physician, Lowell Brown, never referred him to a mental health professional to treat any mental problem (other than alcohol and drug abuse) and also never diagnosed Plaintiff with a mental disorder. In fact, Dr. Brown marked Plaintiff's "capacity for sustained mental activities" as a "mild limitation." (Transcript pg. 321).
Based on the opinions of the various medical examiners discussed in the preceding paragraph (which of course conflict with Imhoff's opinion), it appears that there is substantial evidence supporting the ALJ's decision that Plaintiff is not disabled. See Walker v. Bowen, 834 F.2d 635, 640 (7th Cir.1987) ("Where conflicting evidence allows reasonable minds to differ as to whether a claimant is disabled, the responsibility for that decision falls on the Secretary (or the Secretary's designate, the ALJ)."). Plaintiff, however, essentially argues that Imhoff's opinion should be accorded greater consideration because he was the only examiner to conduct a "battery of psychological tests." In fact, Plaintiff claims that the ALJ's opinion is not supported by substantial evidence since the other medical examiners never specifically tested for the impairments at issue. Finally, Plaintiff claims that since no other medical examiners conducted a "battery of psychological tests," Imhoff's conclusions were uncontradicted, thus, the ALJ, in concluding that Plaintiff did not suffer from a listed impairment, substituted her own judgment for that of a relevant professional. See Scivally v. Sullivan, 966 F.2d 1070, 1076 (7th Cir.1992) ("The Secretary's decision must be based on testimony and medical evidence in the record, and the Secretary cannot make his own independent medical determination about the claimant.").
Essentially, Plaintiff asks the Court to hold that when a medical examiner performs a "battery of psychological tests" that medical examiner's conclusion is, as a matter of law, superior to the conclusions of other examiners who failed to administer such tests. Or, in other words, a medical examiner's failure to administer a "battery of psychological tests" indicates (as a matter of law) that the medical examiner's conclusion regarding the patient's mental or psychological well-being is unsubstantiated, or at the very least, inferior to an examiner who administered such tests.
In response to Plaintiff's argument, we first note that Dr. Brelje did in fact perform a standardized test (the WAIS-R). Furthermore, every examiner, with the exception of Plaintiff's treating physician, administered some form of oral examination whereby they asked Plaintiff questions and based their individual diagnosis on Plaintiff's responses (Dr. Reddy referred to the test as a "mental status examination"). In response, Plaintiff would most likely argue that the tests performed by Imhoff are more thorough and complete, thus, they are more accurate indicators of psychological impairments than the "simple" tests performed by the other examiners.
Perhaps Plaintiff is correct. However, the problem with Plaintiff's contention is that the Court is not qualified or competent to support that conclusion. That is, the Court is obviously not educated or trained in the medical field, thus, we certainly cannot conclude that Imhoff's opinion is superior to the other examiners' opinions merely because he performed additional tests. As far as we know, an examiner's opinion regarding one's psychological well-being based on that examiner's *762 observation of the patient and his analysis of responses to certain questions is just as accurate as an examiner who performs a "battery of psychological tests."[8] Plaintiff fails to cite any medical or legal authority in support of his contention, nor could the Court locate any such authority.[9] And, as noted above, Plaintiff has the burden of proving that he suffers from one of the listed impairments. Thus, we conclude that the ALJ's conclusion is supported by substantial evidence, namely the opinions of the other examiners who unanimously concluded that Plaintiff did not suffer from any psychological impairments.
Furthermore, the ALJ discredited Imhoff's report for numerous reasons, according it low probative value. Plaintiff objects to many of the reasons articulated by the ALJ in discrediting the report. Based on our analysis, we cannot conclude that the ALJ improperly rejected Imhoff's report.
First, the ALJ noted that Imhoff, aware of the opinions of other examining psychiatrists and psychologists finding no evidence of mental impairments, diagnosed an organic mental disorder, yet he failed to perform additional tests which would apparently confirm the presence of such a disorder.[10] If Imhoff diagnosed Plaintiff with an organic mental disorder, why did he neglect to perform additional tests which would confirm such a conclusion (especially considering no other examiners could find evidence of a mental impairment)?
Second, Imhoff concluded that Plaintiff was functioning at a rate of 44 to 49 on the Global Assessment of Functioning Scale. Such a functioning rate is associated with "serious symptoms of a mental impairment, such as suicide ideation, severe obsessional rituals, frequent shop-lifting, and a serious impairment in social, occupational or school functioning, such as the total lack of friends, or the inability to keep a job." (Transcript pg. 27). The ALJ concluded that Plaintiff's testimony at the hearing directly contradicted Imhoff's findings. We agree.
No other medical examiner concluded that Plaintiff suffered from anything other than alcohol and drug abuse/dependence. There is no evidence in the record indicative or analogous to suicide ideation, severe obsessional rituals, or frequent shop-lifting. Regarding Imhoff's report finding a serious impairment in social functioning, Plaintiff testified that he visits friends once or twice a week (friends who do not use drugs or alcohol) (Transcript pg. 61 and 71), that he attends Alcoholics Anonymous meetings twice a week (Transcript pg. 61), that he has been recently attending church every Sunday (Transcript pg. 71), and that he performs some housework and prepares simple meals (Transcript pg. 61). True, Plaintiff has difficulty in maintaining employment, but by his *763 own admission this is apparently due to his alcohol problem (Transcript pg. 54 and 65).
Third, Imhoff diagnosed Plaintiff with a personality disorder. However, as discussed below, Imhoff's mental capacity evaluation is inconsistent with such a diagnosis. Thus, we conclude that there is substantial evidence supporting the ALJ's decision discrediting Imhoff's report.
B. Personality Disorders (Listing 12.08)
Plaintiff also apparently argues that he suffers from a personality disorder. In support of his argument, he relies entirely upon Imhoff's report. However, as noted above, Imhoff's report fails to satisfy the Listing 12.08 criteria necessary for finding a presumptively disabling personality disorder. That is, according to Listing 12.08B, the required level of severity for a personality disorder is met when, among other things, three of the following result:
1. Marked restriction of activities of daily living; or
2. Marked difficulties in maintaining social functioning; or
3. Deficiencies of concentration, persistent or pace resulting in frequent failure to complete tasks in a timely manner (in work settings or elsewhere); or
4. Repeated episodes of deterioration or decompensation in work or work-like settings which cause the individual to withdraw from that situation or to experience exacerbation of signs and symptoms (which may include deterioration of adaptive behaviors).
20 C.F.R. Pt. 404, Subpt. P, App. 1, Listing 12.08B.[11] Yet, interestingly, Imhoff's report analyzing Plaintiff's degree of functional restriction concludes that Plaintiff does not have a "marked restriction" or "marked difficulty" regarding criterion 1 and 2, respectively. Instead, Imhoff characterizes Plaintiff's functional restrictions under both criterion as "slight to moderate." (Transcript pg. 345). Thus, according to Imhoff's report, Plaintiff's condition does not result in a finding of three of the four criteria listed in 12.08B. Consequently, for the purposes of receiving supplemental security income, Plaintiff does not presumptively suffer from a personality disorder based on Imhoff's report.
Thus, since Imhoff's report concedes that Plaintiff is not presumptively disabled under Listing 12.08 and no other medical examiner found evidence of a personality disorder, Plaintiff has failed to meet his burden establishing a listed medical impairment. Moreover, since no other examiner concluded that Plaintiff suffered from a mental or personality disorder, the ALJ's decision is supported by substantial evidence.
II
Next, Plaintiff argues that the ALJ erred by relying on the vocational expert's testimony because such testimony failed to consider all of Plaintiff's functional limitations. This argument involves step 5 of the five-part test. Since Plaintiff has no past relevant work experience, the Secretary has the burden at step 5 to establish that he can engage in some type of substantial gainful employment.
In determining whether Plaintiff could perform a significant number of jobs in the national economy, the ALJ employed the services of a vocational expert. The ALJ asked the vocational expert a hypothetical question and directed the expert to determine, after considering the limitations posed by the question, what types of jobs such an individual could perform. (Transcript pg. 73-74). Plaintiff argues that the hypothetical question failed to accurately reflect his limitations and capabilities, thus, the ALJ's determination that he could perform a significant number of jobs in the national economy was not supported by substantial evidence.
First, Plaintiff argues that the hypothetical question did not reflect the limitations as stated by Imhoff. However, as discussed throughout this order, Imhoff's report was validly discredited by the ALJ for numerous reasons.
Next, Plaintiff argues that, regardless of Imhoff's report, the hypothetical question assumed *764 that Plaintiff was functioning at an educational level equivalent to a high school graduate, yet the record supports the conclusion that his educational level is much lower. Thus, argues Plaintiff, the jobs identified by the vocational expert are not appropriate for an individual with Plaintiff's developmental limitations. Specifically, Plaintiff, citing the Dictionary of Occupational Titles (DOT), argues that the jobs identified by the vocational expert are inappropriate for an individual with his level of reasoning, mathematical, and language development. We disagree.
Plaintiff's argument is initially premised on the conclusion that the vocational expert was unaware of his borderline intellectual functioning level. That is, because the ALJ's hypothetical question referred to an individual with a high school education, Plaintiff assumes the vocational expert's response was also based on an individual with that level of education. However, the vocational expert was well aware of the fact that, although Plaintiff obtained a high school diploma, he was not functioning at a level generally associated with a high school education. Indeed, the vocational expert was aware of Plaintiff's intelligence quotient (IQ) scores (evidencing borderline intelligence functioning, but not quite in the mentally retarded range) and he even adopted Imhoff's report finding that Plaintiff read and performed arithmetic at a fourth grade level. (Transcript pg. 77). With this information in mind, the vocational expert identified several jobs in the national economy that Plaintiff could perform. Thus, although the hypothetical question referred to an individual with a high school education, the vocational expert was well aware of Plaintiff's intellectual limitations.
Next, Plaintiff argues that the vocational expert's description of the identified jobs was contrary to the DOT's characterization. Related to that argument, Plaintiff further contends that the DOT requires greater levels of reasoning, mathematical, and language skills than Plaintiff possesses. The above arguments are premised on the conclusion that the DOT's general educational development requirements (i.e., reasoning, mathematical, and language skills) are binding on the ALJ. However, the DOT's requirements are not controlling and they are to be applied in light of the vocational expert's professional knowledge regarding one's ability to perform an identified job. See Conn v. Secretary of Health and Human Services, 51 F.3d 607 (6th Cir.1995) ("[T]he ALJ may rely on the testimony of the vocational expert even if it is inconsistent with the job descriptions set forth in the Dictionary."); Basinger v. Secretary of Health and Human Services, No. 94-3004, 1994 WL 421726, U.S.App. LEXIS 21795 (6th Cir. Aug. 11, 1994) ("The social security regulations do not require the Secretary or the vocational expert to rely on DOT classifications."); Barker v. Shalala, 40 F.3d 789, 795 (6th Cir.1994) ("It would be manifestly inappropriate to make the [DOT] the sole source of evidence concerning gainful employment."); Jackson v. Sullivan, No. 92-C-4089, U.S.Dist. LEXIS 10903 (N.D.Ill. Aug. 3, 1993) ("We do not read [the regulations] as requiring an ALJ to follow DOT classifications in spite of contrary testimony from a vocational expert.").
Here, as noted above, the vocational expert was well aware of Plaintiff's intellectual deficiencies. (Transcript pg. 77). Although he was unaware of the general educational development requirements pertaining to each individual identified job, the vocational expert stated that such jobs could be performed by an individual operating at a fourth grade level. (Transcript pg. 77). In fact, the vocational expert further stated that the identified jobs could even be performed satisfactorily by individuals "who are classified as mentally retarded."[12] (Transcript pg. 77). Thus, regardless of the DOT requirements, the vocational expert's professional knowledge supported his conclusion that Plaintiff could perform the identified jobs. Consequently, since the ALJ relied on the vocational expert's testimony, her conclusion that Plaintiff could perform significant jobs in the *765 national economy was supported by substantial evidence.[13]
III
Ergo, Plaintiff's motion for summary judgment (d/e 8) is DENIED. The Secretary's motion for summary affirmance (d/e 10) is ALLOWED.
NOTES
[1] Plaintiff's argument involves step 3 of the five-step process utilized by the Secretary to determine if one is disabled. If Plaintiff did in fact suffer from a listed impairment, he would of course be entitled to supplemental security income.
[2] The claimant is first required to demonstrate one of seven criteria listed in part A. However, since the disputed issue pertains to the ALJ's conclusion regarding the criteria of part B, there is no need to discuss part A.
[3] Imhoff concluded that Plaintiff did not have a "marked" restriction or difficulty in criterion one or two, respectively. Instead, he concluded Plaintiff's condition resulted in a "slight to moderate" restriction and difficulty regarding the respective criterion. (Transcript pg. 345).
[4] Three or more instances of deterioration or decompensation qualify as "repeated episodes." See 20 C.F.R. § 404.1520a(b)(3).
[5] Plaintiff's employment history consists of a few months of janitorial-type work for Maintenance Supply Corporation (Transcript pg. 53-54), a week at the Mermaid Car Wash (Transcript pg. 54), and six months of part-time janitorial-type work for SEDA (Transcript pg. 54). Arguably, the only incident of deterioration or decompensation in the record is Plaintiff's termination from Maintenance Supply Corporation due to alcoholism. (Transcript pg. 65). However, there is no indication that his termination was the result of deterioration or decompensation in conjunction with his alcoholism. Regardless, one incident of deterioration or decompensation is not enough to satisfy the criterion four standard of "repeated episodes."
[6] Also, it is important to stress that criterion four refers to "work or work-like settings." Thus, although Plaintiff has limited work experience, he can meet criterion four by identifying deterioration or decompensation in "work-like" settings or environments. Thus, by referring to "work-like" settings, arguably, criterion four does not penalize people like Plaintiff who have a rather meager employment history.
[7] As noted above, in order for his condition to be classified as an organic mental disorder, Plaintiff is required to prove that such condition meets two of the four criteria of part B. Even Imhoff concluded that Plaintiff's condition did not meet criterion one or two. And, based on our analysis, we agree with the ALJ finding Imhoff's conclusion regarding criterion four misleading and unreliable. Thus, at best, Plaintiff can only meet one of the four criteria listed in part B. Because Plaintiff can only meet one of part B's criteria, he is presumptively not disabled for purposes of receiving supplemental security income.
[8] Furthermore, as noted above, Dr. Brelje did in fact administer a standard intelligence test and Dr. Reddy conducted what he termed a "mental status examination." Additionally, all examiners (except for Plaintiff's long-term treating physician) asked several questions and based their respective opinion regarding Plaintiff's mental well-being on the responses to those questions. Are these tests sufficient to indicate the presence of a mental impairment? Are more tests required? We do not know. However, apparently the individual examiners were satisfied with the results (concluding that no mental or psychological impairment was present) such that no further testing was required.
[9] According to Listing 12.02, an organic mental disorder is discovered through "history and physical examination or laboratory tests." (emphasis added). There is no indication that an examiner must administer numerous tests. Moreover, 20 C.F.R. Pt. 404, Subpt. P, App. 1, Listing 12.00D, states that "[t]he results of well-standardized psychological tests ... may be useful in establishing the existence of a mental disorder." (emphasis added). Listing 12.00D does not require the use of such tests. However, Listing 12.00D also states that "[i]n cases involving impaired intellectual functioning, a standardized intelligence test, e.g., the WAIS, should be administered and interpreted by a psychologist or psychiatrist...." (emphasis added). As noted above, Dr. Brelje administered the WAIS-R and concluded that Plaintiff did not suffer from a mental disorder.
[10] In the ALJ's decision, she states that the Luria-Nebraska and Halstead-Reitan tests would "confirm the existence of an organic brain disorder." We could not locate any medical or legal authority supporting or challenging that conclusion. However, since Plaintiff does not challenge the ALJ's statement, apparently he concedes that such tests would confirm the existence of the disorder at issue.
[11] Plaintiff must also satisfy part A of Listing 12.08.
[12] No examiner, including Imhoff, found Plaintiff to be functioning at a level within the mentally retarded range. Rather, every examiner classified Plaintiff's mental skills as "below average" or "borderline range of intellectual functioning."
[13] Plaintiff does not attack any additional conclusions reached by the ALJ regarding his ability to perform the jobs at issue. For example, the ALJ concluded that Plaintiff could perform simple, unskilled work. Plaintiff does not challenge that conclusion. Rather, Plaintiff argues that the jobs at issue require more skills than he exhibits. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603538/ | 354 N.W.2d 701 (1984)
In the Matter of the Application of OTTER TAIL POWER COMPANY for an Order and Certificate of Public Convenience and Necessity to Provide Electric Service to the Bureau of Indian Affairs, at Belcourt, North Dakota.
OTTER TAIL POWER COMPANY, Appellee,
v.
NORTH DAKOTA PUBLIC SERVICE COMMISSION, and Baker Electric Cooperative, Inc., Appellants.
Civ. No. 10653.
Supreme Court of North Dakota.
August 20, 1984.
*702 Ackre and Baer, Cando, for appellant, Baker Elec.; argued by Larry M. Baer, Cando.
Jay D. Myster, Fergus Falls, Minn., for appellee Otter Tail Power Co.; argued by Jay D. Myster, Fergus Falls, Minn.
Daniel S. Kuntz, Asst. Atty. Gen., Public Service Com'n, Bismarck, no appearance.
Stephen D. Little, Asst. Atty. Gen., Bismarck, and Ronald A. Hodge, Sp. Asst. Atty. Gen., Bismarck, for State of N.D., on brief only.
PEDERSON, Justice.
In November 1981, Otter Tail Power Company applied to the Public Service Commission (PSC) for authority, pursuant to § 49-03-01.1, NDCC, to extend its electric service about 100 feet to the site of a new Bureau of Indian Affairs (BIA) school building located near Belcourt. The school is not located within the corporate limits of any municipality but is within the boundaries of the Turtle Mountain Indian Reservation. Baker Electric Cooperative filed a consent to the grant of temporary authority but objected to a permanent certificate of public convenience and necessity. With its application Otter Tail filed a customer preference, executed by a representative of BIA.[1] The PSC granted temporary authority to Otter Tail and set a hearing on the matter of the application for a permanent certificate.
PSC jurisdiction was not questioned at the hearing nor was it considered when the PSC granted permanent authority to Otter Tail. A rehearing was requested and granted to Baker Electric. Again no one raised questions relating to PSC jurisdiction. After the rehearing, the PSC found that service by Baker Electric would be more reliable than service by Otter Tail; the economic benefit to Baker Electric would be greater than the economic benefit to Otter Tail; and to deny Otter Tail this certificate of authority would prevent "checkerboarding." The PSC reversed itself and denied permanent authority to Otter Tail. It did not grant Baker Electric authority. Otter Tail then requested another rehearing. It was denied, and Otter Tail appealed to the district court pursuant to the Administrative Agencies Practice Act (Ch. 28-32, NDCC). Specifications of error, as required by § 28-32-15, were filed.
In Matter of Boschee, 347 N.W.2d 331, 335 (N.D.1984), we held that on appeals of administrative agency decisions, courts may consider only those grounds specified however, the grounds must come within the provisions of § 28-32-19.[2] The specifications *703 of error filed by Otter Tail are extensive and detailed and include, for the first time, a claim that the PSC has no jurisdiction within the boundaries of the Indian reservation.[3] Otter Tail claimed, inconsistently, that the PSC erred in failing to grant permanent authority to Otter Tail.
On the appeal the trial court, citing Article XIII, Section 1, of the North Dakota Constitution,[4] held that the PSC did not have jurisdiction to act under Chapter 49-03, NDCC. The court further ruled that if it presumed that the PSC had jurisdiction, it would defer to PSC expertise and sustain the decision to deny the Otter Tail application for permanent authority.
Baker Electric appealed to this court and argues that the PSC has regulatory jurisdiction over the territorial service areas of competing public utilities even where the service point is within an Indian reservation. The attorney general, representing the State of North Dakota (and presumably the PSC) supports the Baker Electric position.
Belcourt is a community of approximately 2,000 residents but is not organized as a municipality under the laws of North Dakota. Since 1955, the area in and around Belcourt, within the Indian reservation, has been provided electrical service by Otter Tail, Baker Electric, and a BIA-owned distribution system. In 1968, the BIA sold its system to Otter Tail pursuant to Public Law 87-279, 75 Stat. 577, 25 U.S.C. § 15. The contract provided:
"Otter Tail will provide electric service to customers requesting same subsequent to the effective date of this contract in accordance with Otter Tail's rules and regulations and in conformance with the rules and regulations of the Public Service Commission of the State of North Dakota."
In this court Otter Tail argues (consistent with the trial court's ruling) that this case does not involve "a question of jurisdiction of Indian persons, Indian tribes or non-Indians ... or interference with tribal self government ...." Otter Tail contends "... the issue does deal with the impairment of rights granted by federal law," and interference with federal regulation of land use contrary to the supremacy clause.[5]
We first need to examine the posture of this case to determine whether Otter Tail's appeal hasgiven the courts jurisdiction, as well as sufficient facts necessary to determine whether or not the PSC had jurisdiction to act in this case. Similar circumstances were confronted in Johnson v. Elkin, 263 N.W.2d 123 (N.D.1978). In *704 that case, a divided court concluded that under the Administrative Agencies Practice Act (Ch. 28-32, NDCC), "under certain circumstances" constitutional issues can be raised for the first time at the district court level.
Neither the Legislature nor this court has attempted any refinement that permits someone to readily determine when it is necessary to institute a collateral attack and when it is permissible to use the administrative proceedings to assert that "the decision is in violation of the constitutional rights of the appellant" (§ 28-32-19(2), NDCC). We conclude, in this case, that a collateral proceeding would have been more appropriate and more helpful to a thorough examination of the federal supremacy question, yet we cannot say that under present law the question can only be raised in a collateral proceeding.
Most cases, whether upholding state law or overturning it on the basis of a conflict with a federal preemption, start with a cite to McCulloch v. Maryland, 17 U.S. 316, 4 Wheat 316, 4 L. Ed. 579 (U.S.1819). A favorite quote is Chief Justice Marshall's:
"It is of the very essence of supremacy to remove all obstacles to its action within its own sphere, and so to modify every power vested in subordinate governments as to exempt its own operations from their own influence. This effect need not be stated in terms. It is so involved in the declaration of supremacy, so necessarily implied in it, that the expression of it could not make it more certain." 17 U.S. 316, 426-427, 4 Wheat 316, 426-427, 4 L. Ed. 579, 606-607.
Chief Justice Marshall was writing about the imposition of taxes. Perhaps if he had before him a case involving a split of regulatory authority, he might have said that Congress, indeed, would need to explicitly declare the extent of the federal preemption. For example, Justice White, writing for the majority in Pacific Gas & Electric Co. v. State Energy Resources Conservation & Development Comm'n, 461 U.S. 190, 103 S. Ct. 1713, 1717, 1719, 75 L. Ed. 2d 752 (1983), referred to the point at which federal efforts intersect "with the exercise of the historic state authority ...." Justice White concluded that in the field of regulating nuclear energy power plants, Congress has split the authority in that the federal Atomic Energy Act authorized states to regulate nuclear power plants for some purposes. [See Section 271, 42 U.S.C. § 2018 and Section 274(k), 42 U.S.C. § 2021(k)].
See also Marshall v. Burlington Northern, Inc., 720 F.2d 1149 (9th Cir.1983), and cases cited therein. "[The] strong Madison/Marshall `preemptive' view ... is no longer the law of the land." James v. Watt [Clark], 716 F.2d 71 (1st Cir.1983), cert. denied ___ U.S. ___, 104 S. Ct. 2397, 81 L. Ed. 2d 354.
An often-cited dissent by Justice Frankfurter in First Iowa Hydro-Elec. Coop. v. Federal Power Com., 328 U.S. 152, 66 S. Ct. 906, 90 L. Ed. 1143 (1946), pointed out that in certain instances Congress has recognized explicitly the separate interest and role of the state.[6]
About a year after he wrote Pacific Gas & Electric, supra, Justice White explained, in Silkwood v. Kerr-McGee Corp., ___ U.S. ___, 104 S. Ct. 615, 621, 78 L. Ed. 2d 443 (1984):
"As we recently observed in Pacific Gas & Electric Co. v. State Energy Resources Conservation & Development Comm'n, [461] U.S. [190], 103 S. Ct. 1713, 75 L. Ed. 2d 752 (1983), state law can be preempted in either of two general ways. If Congress evidences an intent to occupy a given field, any state law falling within that field is preempted. Id., at ___, 103 S.Ct. at 1722; Fidelity Federal Savings & Loan Ass'n v. de la Cuesta, 458 U.S. 141, 153, 102 S. Ct. 3014, 3022, 73 L. Ed. 2d 664 (1982); Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S. Ct. 1146, 1152, 91 L. Ed. 1447 (1947). If *705 Congress has not entirely displaced state regulation over the matter in question, state law is still preempted to the extent it actually conflicts with federal law, that is, when it is impossible to comply with both state and federal law, Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 142-143, 83 S. Ct. 1210, 1217-1218, 10 L. Ed. 2d 248 (1963), or where the state law stands as an obstacle to the accomplishment of the full purposes and objectives of Congress, Hines v. Davidowitz, 312 U.S. 52, 67, 61 S. Ct. 399, 404, 85 L. Ed. 581 (1941)...."
We are authorized to start with a basic assumption that displacement of state law by a federal preemption was not intended. Maryland v. Louisiana, 451 U.S. 725, 101 S. Ct. 2114, 68 L. Ed. 2d 576 (1981). Not only state-imposed "burdens" but nonconsensual "benefits" may constitute state interference. United States v. City of Adair, 539 F.2d 1185 (8th Cir.1976). A preemption of state action may be accomplished by federal activity implementing an Act of Congress, as well as by the Act of Congress itself. Chrysler Corp. v. Brown, 441 U.S. 281, 99 S. Ct. 1705, 60 L. Ed. 2d 208 (1979).
In Northern States Power Co. v. Hagen, 314 N.W.2d 32, 37 (N.D.1981), Justice Sand, for a unanimous court, wrote:
"Congressional enactments that do not exclude all state legislation in the same field nevertheless override state laws with which they conflict. U.S. Const., Art. VI. The criterion for determining whether or not there is such a conflict is whether the state's law `stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress.' Jones v. Rath Packing Co., 430 U.S. 519, 526, 97 S. Ct. 1305, 51 L. Ed. 2d 604 (1977); Hines v. Davidowitz, 312 U.S. 52, 67, 61 S. Ct. 399, 404, 85 L. Ed. 581 (1941)...."
In our search for the "obstacle" in this case, Otter Tail argues that we should apply the principles from the cases of Public Service Commission v. City of Williston, 160 N.W.2d 534 (N.D.1968), and City of Grafton v. Otter Tail Power Company, 86 N.W.2d 197 (N.D.1957). The Williston case involved the power of the PSC to control the rates at which a utility could supply electrical energy to a city, and the Grafton case involved the making of a contract by a state agency to purchase electrical energy. In both cases this court said that the PSC does not have jurisdiction. To the extent that this court said that the PSC cannot interfere with or encroach upon state affairs, these cases are consistent with the federal court cases we have cited on the issue of preemption.
It appears, in this case, that the objective of the BIA is to contract for energy at the new Belcourt school with the supplier selected pursuant to PSC requirements. (See footnote 1.) We have considered all factors brought to our attention:
(1) the provision in the Otter Tail-BIA contract"in conformance with the rules and regulations of the Public Service Commission of the State of North Dakota";
(2) the filing of a customer preference providing"customer [BIA] ... desires electric service from Otter Tail Power Company as a public utility subject to the jurisdiction of and regulation by this Commission..." [emphasis supplied]; and
(3) the statement in the BIA letter "The Bureau of Indian Affairs is obliged to purchase power from the utility company serving the area where the facility is located. In disputes, such as exists for the new school site, the bureau will comply with the decision of the appropriate regulatory authority."
We cannot avoid the conclusion that the PSC action provided no "obstacle" to the federal purpose but was entirely consistent therewith.
Finally, we need to comment upon the Baker Electric and State of North Dakota argument that the exercise of jurisdiction by the PSC within the Indian reservation in this case does not infringe upon the right of tribal self-government. The district court decision was not based upon that theory, and Otter Tail's argument realistically *706 must be interpreted as a concession that there is no "Indian jurisdiction" question in this case. Under these circumstances, that issue is moot and we will not consider it further.
The judgment of the district court is reversed. The case is remanded for entry of judgment affirming the determination of the PSC.
ERICKSTAD, C.J., GIERKE and SAND, JJ., and ILVEDSON, Surrogate Judge, concur.
VANDE WALLE, J. disqualified; ILVEDSON, Surrogate Judge, sitting in his stead.
NOTES
[1] Customer preference is only one factor to be considered. Syllabus 5, Tri-County Electric Cooperative, Inc. v. Elkin, 224 N.W.2d 785 (N.D. 1974). In this case the assistant area director for administration of the BIA office in Aberdeen informed Baker Electric: "The Bureau of Indian Affairs is obliged to purchase power from the utility company serving the area where the facility is located. In disputes, such as exists for the new school site, the Bureau will comply with the decision of the appropriate regulatory authority."
[2] The permissible grounds upon which the administrative agency determination may be challenged, as listed in § 28-32-19, are:
"1. The decision or determination is not in accordance with the law.
"2. The decision is in violation of the constitutional rights of the appellant.
"3. Provisions of this chapter [28-32] have not been complied with in the proceedings before the agency.
"4. The rules or procedure of the agency have not afforded the appellant a fair hearing.
"5. The findings of fact made by the agency are not supported by a preponderance of the evidence.
"6. The conclusions and decision of the agency are not supported by its findings of fact."
[3] Specification of error V(L) states in part: "The location in question is entirely within the boundaries of the Turtle Mountain Indian Reservation within which the federal government has plenary and exclusive jurisdiction, which it exercises through the Bureau of Indian Affairs."
Specification IX states in part: "The federal government has exclusive and plenary jurisdiction on Indian Reservations...."
Specification XI states in part: "... the Commission's error was in assuming that ... [its] jurisdiction would extend to service on a Federal Indian Reservation."
[4] The provision in Article XIII, Section 1, North Dakota Constitution, relied upon by the trial court, provides:
"... Indian lands shall remain under the absolute jurisdiction and control of the Congress of the United States, provided, however, that the legislative assembly of the State of North Dakota may, upon such terms and conditions as it shall adopt, provide for the acceptance of such jurisdiction as may be delegated to the state by Act of Congress; ..."
[5] Article 6, United States Constitution, provides in part: "This Constitution, and the laws of the United States which shall be made in pursuance thereof, and all treaties made or which shall be made, under the authority of the United States, shall be the supreme law of the land; and the judges in every state shall be bound thereby, anything in the Constitution or laws of any state to the contrary notwithstanding."
[6] The relationship between the supremacy clause in Article 6 and the reserved powers provision in the Tenth Amendment, which was not briefed or researched, would appear to require the recognition of a balancing necessity. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603569/ | 882 F. Supp. 137 (1995)
Thomas E. LENGYEL, Plaintiff,
v.
SHEBOYGAN COUNTY, Ann M. Wondergem, and Gary Johnson, Defendants.
Civ. A. No. 94-C-1074.
United States District Court, E.D. Wisconsin.
March 31, 1995.
Thomas Nelson, Shneidman, Myers, Dowling & Blumenfield, Milwaukee, WI, for plaintiff.
Lisa M. Leemon, Lindner & Marsach, Milwaukee, WI, for defendants.
ORDER TO REMAND
REYNOLDS, District Judge.
Plaintiff Thomas E. Lengyel ("Lengyel") claims he was unlawfully terminated from his position as a social work supervisor for Sheboygan County, Wisconsin. On September 9, 1994, he commenced a suit in the Circuit Court for Sheboygan County. On September 26, 1994, defendants removed the case to federal court, asserting that plaintiff's state court suit contained causes of action based on the First, Fifth, and Fourteenth Amendments of the Constitution. Plaintiff's state court complaint, however, did not refer to these constitutional provisions.
On December 8, 1994, this court ordered that the parties brief the question of whether plaintiff's state court complaint, which omitted any reference to the Constitution, laws, or treaties of the United States, and which was brought to enforce state laws, was properly removed to federal court pursuant to 28 U.S.C. §§ 1441 et seq. The court ordered that parties submit simultaneous briefs and reply briefs on this question, but parties failed to do so. Rather, plaintiff submitted an amended complaint on December 29, 1994, which contained two references to 42 U.S.C. § 1983. Defendants submitted an answer to the amended complaint on January 23, 1995.
Federal district courts are courts of limited jurisdiction and have an affirmative duty to ensure that they have jurisdiction to hear the case or controversy before them. National W. Life Ins. v. Fischer, 722 F. Supp. 554 (E.D.Wis.1989). The Seventh Circuit has stated: "[T]he federal courts are obliged to *138 police the constitutional and statutory limitations on their jurisdiction. That is why, even at the appellate level, the court must satisfy itself that there is federal jurisdiction over the case." Kanzelberger v. Kanzelberger, 782 F.2d 774, 777 (7th Cir.1986).
When a district court determines there is a lack of subject matter jurisdiction, the case shall be remanded, even if the parties prefer to remain in federal court. As the Seventh Circuit has observed: "Having found himself in federal court after removal, the plaintiff may want to stay there. A remand on the court's own motion may deprive both sides of their preferred forum." In re Continental Cas. Co., 29 F.3d 292, 294 (7th Cir.1994).
The court has concluded that removal of this case to federal court was improper. Defendants premised their removal on grounds of original jurisdiction, pursuant to 28 U.S.C. 1441(b), which provides:
Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the United States shall be removable without regard to the citizenship or residence of the parties. Any other such action shall be removable only if none of the parties in interest properly joined and served as defendants is a citizen of the State in which such action is brought.
In his state court complaint, however, plaintiff makes no reference to the Constitution, treaties, or laws of the United States. He states causes of action for due process, defamation, and negligence, based primarily on defendants' alleged violation of Wis.Stat. § 19.85(1), ensuring the right of terminated public employees to receive evidentiary hearings in open session. But plaintiff does not make any reference to 42 U.S.C. § 1983, the Constitution, nor to any federal constitutional violation.
Because this case was improperly removed to federal court in the first instance, plaintiff may not keep it in this improper forum by amending his complaint. Federal subject matter jurisdiction must be determined at the time of removal; "a party may not manipulate jurisdiction by amending the complaint." Land and Lakes Co. v. Henderson, No. 94-C-1815, 1994 WL 124876, at *2 (N.D.Ill. Apr. 11, 1994). Similarly, the U.S. Supreme Court and Seventh Circuit have held that federal jurisdiction cannot be conferred by consent of the parties. Gainesville v. Brown-Crummer Invest. Co., 277 U.S. 54, 59, 48 S. Ct. 454, 455-56, 72 L. Ed. 781 (1928); Kanzelberger, 782 F.2d at 777. Rather, this court remains bound by the edict of 28 U.S.C. § 1447(c), which states: "If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded."
IT IS THEREFORE ORDERED that this action is remanded to the Circuit Court of Sheboygan County, Wisconsin. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603559/ | 645 So. 2d 779 (1994)
Harry ABADIE, Jr., et al.
v.
BAYOU STEEL CORPORATION and Honorable Gayle F. Truly, Secretary of Labor.
No. 94-CA-322.
Court of Appeal of Louisiana, Fifth Circuit.
October 25, 1994.
Writ Denied February 3, 1995.
*780 Louis L. Robein, Jr., Metairie, for plaintiff/appellant, Harry Abadie, Jr.
H. Mark Adams, Katy Kimbell Theriot, Jones, Walker, New Orleans, for defendant/appellee, Bayou Steel Corp.
Denise Ann Nagel, Virginia G. Benoist, Baton Rouge, for defendant/appellee, Louisiana Dept. of Labor.
Before WICKER, CANNELLA, JJ., AND JOHN C. BOUTALL, J., Pro Tem.
JOHN C. BOUTALL, Judge Pro Tem.
This case involves claims for unemployment compensation. The plaintiffs are employees of Bayou Steel Corporation. They filed suit in the 40th Judicial District to contest a determination by the Administrative Review Board that they were excluded from collecting benefits under La.R.S. 23:1601(4) as active members of a strike. Named as defendants in the suit were Bayou Steel and Honorable Gayle F. Truely, Secretary of Labor. The decision of the Review Board was affirmed by the trial court and both the plaintiffs and the Honorable Gayle F. Truely have appealed to this court for review. We likewise affirm the decision of the review panel.
The plaintiffs are employees of Bayou Steel Corporation and members of the United Steel Workers of America. These employees were working under a six year contract which expired on February 28, 1993. The union and the company failed to successfully negotiate a new contract and the union called a strike which began on March 21, 1993. All of the claimants herein have participated in the strike by refusing to return to work and/or walking the picket line.
In April of 1993, the employees filed their claims for unemployment compensation. Bayou Steel opposed the claims, alleging that claimants were disqualified from receiving benefits under La.R.S. 23:1601(2) (employee misconduct) and La.R.S. 23:1601(4) (employees who are actively participating in or who are interested in an ongoing labor dispute). On April 21, 1993, the Administrator made an initial determination disqualifying claimants from receiving benefits. Subsequently, on May 4, 1993, the Administrator issued a Non-monetary Determination which reversed his prior decision and found that the claimants were entitled to unemployment benefits.
Bayou Steel Corporation appealed and the matter was presented to Administrative Law Judge Dennis Dykes. After a hearing, he found that La.R.S. 23:1601(2) was inapplicable to this case. He further found that claimants were actively participating in an ongoing strike and therefore they were disqualified from receiving benefits under La. R.S. 23:1601(4).
*781 The claimants appealed to the Board of Review, which affirmed the decision of the Administrative Law Judge. The board articulated its findings of fact and applications of law as follows:
The claimants worked for the employer under a bargaining agreement between the employer and the United Steelworkers of America, AFL-CIO-CLC USWA) (hereafter referred to as "the union"). Most of the claimants worked the full six-year term of the agreement, March 1, 1987 through February 28, 1993.
Discussions regarding a new contract began January 15, 1993. A strike authorization vote was given by the union membership on February 24, 1993. The union notified the employer of the strike authorization vote. The employer made preparations in case a strike occurred; those preparations included planning to hire replacements for striking employees.
The contract was to have expired on February 28, 1993; however, the union and employer agreed to two (2) extensions of the contract, through March 20, 1993. Negotiations continued; a settlement could not be reached.
March 19, 1993 the union and company met. The union refused to agree to another extension of the expiring contract; the union did agree to give the employer 48 hours notice of a called strike. Approximately two hours later, the union advised the employer that it would begin a strike on March 21, 1993.
March 20, 1993 the employer made a "last ditch" offer in an effort to avert a strike. They informed the union that if the offer was rejected by the membership, the employer would determine that an impasse had been reached and that the conditions of the March 19, 1993 offer would be imposed. The union bargaining committee, having been authorized by the membership vote on February 24, 1993, rejected the offer and advised the employer that the strike would proceed. An impasse was not declared.
The strike began March 21, 1993. All of the claimants have participated in the strike by refusing to return to work and/or by walking the picket lines.
Some of the union members did not go out on strike, but rather reported for work immediately as scheduled. Some of the union members who did initially participate in the strike by refusing to work, have since crossed the picket lines and returned to work. Approximately 122 strike replacement workers have been hired and are also crossing the picket lines to work.
The employer has not unilaterally imposed new working conditions. The employer is voluntarily adhering to the expired contract in rates of pay, benefit schedules, etc., on those workers who continue employment, union or not. Claimant Ferraro asserts that the employer is sub-contracting truck driver jobs (approximately 24 jobs affected) in violation of the expired contract.
OPINION
R.S. 23:1601(2) provides that an individual shall be disqualified for benefits if the Administrator finds that he has been discharged by a base period or subsequent employer for misconduct connected with his employment. Such disqualification shall continue until such time as the claimant (a) can demonstrate that he has been paid wages for work subject to the Louisiana Employment Security law or to the unemployment insurance laws of any other state or of the United States equivalent to at least ten times his weekly benefit amount following the week in which the disqualifying act occurred and (b) has not left his last work under disqualifying circumstances. In addition, if the administrator finds that such misconduct has impaired the right, damaged or misappropriated the property of, or has damaged the reputation of a base period employer, then the wage credits earned by the individual with the employer shall be cancelled, and no benefits shall be paid on the basis of wages paid to the individual by such employer.
R.S. 23:1601(4) For any week with respect to which the administrator finds that his unemployment is due to a labor dispute *782 which is in active progress at the factory, establishment, or other premises at which he is or was last employed; but such disqualification shall not apply if it is shown to the satisfaction of the administrator that he is not participating in or interested in the labor dispute which caused his unemployment. For the purposes of this Subsection, if separate branches of work which are commonly conducted as separate businesses in separate premises, are conducted in separate departments of the same premises, each such department shall be deemed to be a separate factory, establishment or other premises.
There is no testimony or evidence indicating that the claimants have been "discharged" from their employment. Rather, the record indicates that former "strikers" have returned to work with this employer. In accordance with federal law, they continue to have the right to reinstatement upon application, as jobs become available. National Labor Relations Board v. Fleetwood Trailer Co., Inc., 389 U.S. 375, 88 Sup.Ct. [S.Ct.] 543, 19 L. Ed. 2d 614 (1967).
There is no testimony or evidence indicating that the claimants have "quit" their employment with Bayou Steel Corp., as alleged in their memorandum to the Board of Review. To the contrary, the claimants have provided written statements indicating that they are unemployed as a result of a labor dispute. This is substantiated by the testimony of Claimant Ferraro who stated "... we had no alternative but to go on strike ..." Further, the employer has received no notices of resignation, nor has the Department of Labor (agency) been advised by these claimants that they have subsequently "quit".
The Unemployment Act is not intended to encourage idleness or labor disputes nor to force an employer to contribute benefits to help finance his employees' disputes with him. Only an employee prevented from working through no fault of his own should be entitled to unemployment benefits. Thus, the disqualification provision of LSA-R.S. 23:1601(4) must be regarded as an expression of public policy that the State remain neutral in labor disputes. The award or denial of unemployment compensation should not be available as a weapon to either labor or management, as they seek to resolve their differences. See Piggly Wiggly v. Gerace, 370 So. 2d 1327 (La.App. 2d Cir.1979).
The Louisiana Employment Security Law requires the employer to pay substantial sums into a fund from which unemployment compensation benefits are paid. The employee contributes nothing to this fund. Avoiding placing an employer in a position of being compelled by statute to subsidize a strike undoubtedly was one of the reasons which prompted the Legislature to disqualify those who are participating in or interested in a labor dispute, and we consider that a broad disqualification was intended by those categories. See Senegal v. Lake Charles Stevedores, Inc. [250 La. 623], 197 So. 2d 648 (La.1967).
The burden is on the employee to prove that he comes within the exceptions to disqualification by showing that he is neither participating in nor interested in the dispute. See Senegal v. Lake Charles Stevedores, Inc. [250 La. 623], 197 So. 2d 648 (La.1967).
In this case, the claimants refused to accept an extension of the expiring contract. An extension would have allowed them to continue working as they had for the prior six year period, while negotiations of a new contract continued. Rather, the claimants elected to strike. There has been no lockout, nor has there been an impasse.
Due to the aforementioned, it must be concluded that the claimants are unemployed as a result of a labor dispute in active progress at the premises at which they were last employed. Further, as the claimants continue in their refusal to cross the picket lines and their refusal to return to work, it must be concluded that these claimants are participating in and interested in the labor dispute. For these reasons, the claimants are not entitled to Unemployment Insurance Benefits.
These findings were affirmed by the 40th Judicial District Court. In its reasons for judgment, the trial court stated:
*783 Considering the Board's sufficiently supported findings that claimants' unemployment was due to the labor dispute in progress and that claimants have not shown that they are not participating in or interested in that labor dispute, and considering the plain language of the quoted law, and considering but notwithstanding the thorough and insightful arguments to the contrary by claimants and by the Secretary, this court concludes it has no alternative on judicial review but to affirm the Board's decision.
Both the claimants and the Department of Labor, through its Secretary, the Honorable Gayle F. Truely allege that the evidence is insufficient to support the decision of the Board of Review and that the decision is incorrect as a matter of law. Both further request that, in the alternative, this matter should be remanded for the taking of evidence on matters which occurred after the hearing before Administrative Law Judge Dykes. In addition, the Department of Labor argues that the present state jurisprudence violates state statutory and constitutional law; jeopardizes public policy and favors an exclusive remedy in favor of the employer against the employee.
At the onset, it is important to note the standard of review by which we are bound in matters of this kind. La.R.S. 23:1634 provides in part that "In any proceeding under this section the findings of the board of review as to the facts, if supported by sufficient evidence and in the absence of fraud, shall be conclusive, and the jurisdiction of the court shall be confined to questions of law."
There must be legal and competent evidence to support the factual findings on which the administrative determination turns. Banks v. Administrator of Dept. of Labor, 393 So. 2d 696 (La.1981). Judicial review of the findings of the Board of Review does not permit the weighing of evidence, drawing of inferences, reevaluation of evidence or substituting the views of the court for that of the Board of Review as to the correctness of the facts presented. Dupont v. Blanche, 514 So. 2d 286 (La.App. 5 Cir. 1987).
In this case, after a careful review of the record, we believe that the findings of the review panel are supported by sufficient evidence and, therefore, we are bound by these findings. Plaintiffs allege that company actions threatening new working conditions, reductions in pay and termination of an undisclosed number of employees for strike misconduct constituted a "lock out" thereby making them eligible for unemployment benefits. The Board of Review found, however, that these changes were not made and that the plant was currently working under the terms of the expired contract pending a resolution of the labor dispute, and the actions of Bayou Steel did not constitute a lockout.
Plaintiffs and the Department of Labor also argue that Bayou Steel's actions in hiring replacement workers for an indefinite time operates as a discharge of the striking employees, and makes them eligible for benefits. This argument was rejected by the First Circuit in Associated Grocers v. Adm'r of Employment Sec., 496 So. 2d 450, 451-52 (La.App. 1 Cir.1986) writ denied 497 So. 2d 1389 (La.1986):
After reviewing the record of the instant case as a whole, we find that the trial court was correct in determining that the agency incorrectly applied the law. The claimants became unemployed because of a labor dispute. Even assuming that all the claimants were permanently replaced as of June 20, 1983, jurisprudence states that such action does not constitute a cessation of the labor dispute or the claimants' participation or interest in the dispute within the meaning of LSA-R.S. 23:1601(4). See Elmer Candy Corp. [v. Administrator of Employment Security], 286 So.2d [423, 427-28 (La.App. 1 Cir.1973)]. Since the labor dispute itself had not ended, in order to obtain unemployment compensation benefits, it is incumbent upon the claimants to show that they were not participating in or interested in the labor dispute which caused their unemployment. Senegal, 197 So.2d [648, 651 (La.1967) ]. The evidence in the record does not support the Board of Review's finding of disinterest.
*784 The record shows that, at the time of the hearing, the claimants were no longer picketing, but that they were still members of the striking union, that they had picketed until they sought unemployment benefits, that at least one of them still would not cross established picket lines, that some of them were still passing out leaflets encouraging a boycott of the plaintiff, and that they had not asked to be reinstated although they claimed to be available for work either at plaintiff's establishment or elsewhere. The record also shows that there is no evidence that any of the claimants have been discharged by the plaintiff. In accordance with federal law, they continued to have the right to reinstatement upon application, as jobs became available. As expressed in Elmer Candy Corp., 286 So.2d at 428, "as Union members, it could not be said that they were not interested in the labor dispute that they had originated, and which caused their unemployment." After a careful review of the record, we agree with the trial court that the claimants have not proven their lack of participation or interest in an ongoing labor dispute.
In this case, plaintiffs likewise have failed to show that they are no longer participating in or interested in the ongoing labor dispute with Bayou Steel Corporation. We are in agreement with our brethren on the First Circuit and, therefore, we find no error of law in the ruling of the Board of Review and the affirmation of same by the trial court that the plaintiffs were actively involved in a labor dispute and were disqualified from receiving unemployment benefits pursuant to La.R.S. 23:1601(4).
Both appellants next request that should this Court fail to reverse the decision of the Board of Review and of the district court, this matter should be remanded for the taking of evidence concerning the actions of Bayou Steel after the original hearing in this matter. These actions, it is argued, show that Bayou Steel is not in good faith in these labor negotiations and, therefore, there is no bona fide labor dispute within the meaning of La.R.S. 23:1601(4).
Appellants argue that a remand is necessary because (1) the identities of the workers to be terminated for strike misconduct has been revealed by Bayou Steel; and (2) the National Labor Relations Board has charged Bayou Steel with serious "law violations" which reflect issue of Bayou's good faith or lack thereof in negotiating with plaintiffs. We find that these allegations are not such as to warrant a remand in this case. There is no evidence to suggest that, at this time, any claimant has been terminated from employment and, therefore, all the claimants are employees actively involved in or interested in the labor dispute within the meaning of La.R.S. 23:1601(4). Second, any alleged violations of the National Labor Relations Act are separate and distinct from the issue of whether the employees herein are entitled to unemployment compensation benefits and therefore are not relevant. Third, the claimants have made a claim based upon the facts at a particular time. If these facts have changed now, they form the basis for another claim. Otherwise, this claim would never be subject to final adjudication.
As stated supra, the Department of Labor also argues that existing Louisiana jurisprudence operates to violate state constitutional and statutory law and is in derogation of public policy. Basically, the department alleges that allowing the company to hire replacement workers, without granting the employees the right to collect unemployment benefits, tips the "balance of power" in favor of the company and unfairly prejudices the employees.
In National Gypsum Co. v. Administrator, Dept. of Emp. S., 313 So. 2d 230, 233 (La.1975), the Louisiana Supreme Court articulated the public policy behind La.R.S. 23:1601(4): "We thus regard the disqualification provision of La.R.S. 23:1601(4) as an expression of the public policy that the State remain neutral in labor disputes. The award or denial of unemployment compensation should not be available as a weapon to either labor or management, as they seek to resolve their differences." We adhere to this policy, pointing out, however, that the facts of National Gypsum and of this case are markedly different.
*785 It has also been recognized that "... the intent of LSA-R.S. 23:1601(4) is undoubtedly to avoid placing an employer in a position of being compelled by state statute to subsidize a strike since the employer is required to pay substantial sums into a fund from which unemployment benefits are paid." Cities Service v. Admin., La. Dept. of Emp., 383 So. 2d 1315, 1318 (La.App. 3 Cir.1980); Mascair v. Blanche, 484 So. 2d 190 (La.App. 5 Cir.1986).
We recognize that strikers who are disqualified from receiving benefits may be placed in a difficult financial position pending the resolution of an ongoing labor dispute. However, we do not believe that this hardship creates a violation of state statutory or constitutional law.
For the above discussed reasons, the findings of the Board of Review and the judgment of the 40th Judicial District Court upholding those findings are affirmed. All costs of this appeal are assessed against plaintiffs/appellants. See La.R.S. 13:5112(D).
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603531/ | 354 N.W.2d 562 (1984)
In re the Marriage of Jane E. EDELMAN, petitioner, Respondent,
v.
Stanley A. EDELMAN, Appellant.
No. C3-84-776.
Court of Appeals of Minnesota.
September 11, 1984.
*563 Craig S. Hunter, Dessert, Smith & Hunter, Park Rapids, for respondent.
Gregory D. Larson, Thomason, Larson & Masog, Park Rapids, for appellant.
Considered and decided by HUSPENI, P.J., and NIERENGARTEN and RANDALL, JJ., with oral argument waived.
OPINION
RANDALL, Judge.
Appellant-husband moved to compel respondent-wife to quit claim 40 acres of land to him in compliance with the original judgment of dissolution, which was entered pursuant to a stipulation in 1975. Respondent-wife moved to modify the judgment. The trial court declined to modify the judgment, but found it ambiguous and interpreted it, awarding the wife ten acres of the land. The husband appealed. We affirm.
FACTS
The parties were divorced in 1975. The judgment, entered pursuant to a stipulation, awarded the parties' homestead to the husband and ordered the parties' 3.2 bar business, located on the same 40 acre tract as the homestead, sold and the proceeds divided equally. The 40 acre parcel itself was not divided; that is, no specific acreage was assigned to the business which sat on the west side of the 40 nor was any specific acreage assigned to the home located on the east end. The business never did get sold. The couple ran it jointly for awhile after the divorce, but the business deteriorated, was later abandoned, and the building which housed the business was taken down. The husband then requested that the wife quit-claim her interest in the entire parcel to him. She refused, and requested the court to declare that half of the 40 acres be awarded to her. She submitted affidavits from herself and from the attorney who represented her at the dissolution stating that at the time of the dissolution, it was the intent of the parties that the business be allocated half of the forty acres. The trial court refused to modify the judgment, but awarded half of the property allocated to the business to the wife. The allocation to the business of 20 acres and the allocation to the wife of one-half of that, or 10 acres, had the net effect of Mr. Edelman ending up with 30 acres and Mrs. Edelman 10 of the couple's 40 acres.
ISSUE
Did the trial court err in awarding 10 of the 40 acres of land to the wife pursuant to the dissolution judgment?
ANALYSIS
While the wife's motion was drafted as a motion to modify the judgment, the trial court recognized that it had no power to modify the judgment, since there was no showing of fraud or mistake. See Minn. Stat. § 518.64, subd. 2 (Supp.1983). The court treated the motion, however, as a motion to interpret the judgment which it found ambiguous in that the judgment did not assign specific acreage to the business and specific acreage to the homestead. *564 The court's action was equitable and within its inherent powers.
In Stieler v. Stieler, 244 Minn. 312, 70 N.W.2d 127 (1955), the Minnesota Supreme Court stated that the interpretation or clarification of an ambiguous divorce decree did not constitute a modification of the decree. It continued: "At a hearing upon [a motion for clarification or interpretation], parole evidence may be received and considered for the purpose of determining what was intended by the judgment and to evolve a more definite expression thereof." Id. at 319, 70 N.W.2d at 131.
The original judgment awarded the wife half the proceeds of the sale of the business. It did not specify, however, how much of the real estate was to be sold with the business. In the absence of anything to refute the affidavits submitted by the wife that twenty acres was intended to be sold with the building, the trial court did not err in deciding that twenty acres should be allocated to the business. Since the business was not sold, but, instead, abandoned, the wife should receive half of what remains of the business the land and the salvage value of the building in order to effectuate the clear intent of the original stipulation and judgment to divide the business equally.
DECISION
The trial court did not err in awarding ten acres of land representing half of the business to the wife.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603537/ | 882 F. Supp. 1553 (1995)
Pamela E. LONG, Plaintiff,
v.
RINGLING BROS.-BARNUM & BAILEY COMBINED SHOWS, INC., Defendant.
Civ. No. AW-91-2927.
United States District Court, D. Maryland.
May 4, 1995.
*1554 *1555 *1556 Mindy G. Farber and Diane A. Seltzer of Jacobs, Jacobs & Farber, Rockville, MD, for plaintiff.
Jeanne M. Phelan and Robert S. Hillman of Whiteford Taylor & Preston, Baltimore, MD, for defendant.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
WILLIAMS, District Judge.
Plaintiff, Pamela E. Long, brought this action under Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq. ("Title VII"), against the Defendant, Ringling Bros.-Barnum & Bailey Combined Shows, Inc., (hereinafter, "Ringling") for sex discrimination based upon an alleged refusal to interview and hire Plaintiff for the position of road controller in Japan solely because she is a female. The Honorable John R. Hargrove, Jr., initially resolved this case by way of summary judgment in favor of Ringling. On appeal, the Fourth Circuit reversed and remanded that decision. See Long v. Ringling Brothers-Barnum & Bailey, 9 F.3d 340 (4th Cir.1993).
On September 14, 1994, Judge Hargrove, Jr. reassigned this case to me and on February 28, 1995, the bench trial began. Having listened to and carefully examined all the evidence, observed witnesses, and having heard closing arguments on March 2, 1995, the Court is now ready to address the merits of Plaintiff's claims.
I. FACTUAL BACKGROUND AND SUMMARY OF EVIDENCE
Plaintiff Long is an Asian American female and a resident of Laurel, Maryland. Defendant Ringling presents live entertainment in touring shows and tours around the world. To meet its employment needs, Ringling uses several recruiting firms. One such firm is MBA Management, Inc. ("MBA"). The dispute in this case stems from Ringling's employment need and advertisement for a road controller position in Japan.
Ms. Long applied for the road controller position with Ringling in June 1989. She learned of the position through MBA, with which Ringling had been in contact in its quest to fill the road controller position. At the time, Mark Antalosky was an Account Executive and recruiter with MBA. He drafted a job order consisting of information provided to him by Anne Marie Patton, Engagement Accounting Manager with Ringling. Based upon the information contained in the job order form, MBA subsequently placed an advertisement for the position in the Japanese Embassy's Cultural Center. The job description as advertised provided:
Interested must be fluent in Japanese and have a full knowledge of accounting (A/P, A/R, journal entry, etc.) The job is 90% travel through Japan. Other duties include doing heavy general ledger through financial statements, doing PC work, and constant interfacing with the home office. *1557 The salary is about $30,000, and benefits include free board, free use of a rental car, and paid travel expenses. You will also be in a low tax bracket. Interested persons please contact:
Jessica Davidson
281-2341.
Ms. Long saw the advertisement posted in the Japanese Embassy's Cultural Center. She spoke fluent Japanese, held a master's degree in accounting, had relevant work experience in accounting and personal computer capabilities, and was willing to relocate to Japan, and travel extensively. On June 19, 1989, she personally presented an application and resume to Jessica Davidson, account executive with MBA. Ms. Davidson subsequently provided the materials to Ringling. Ms. Long testified that Ringling never gave her an interview for the position.
On June 20, 1989, Ms. Davidson called Ms. Long at her office to tell her that the man who would be doing the interviewing was out of town on vacation and would not return until the following week. Ms. Davidson indicated that she would follow up with Ms. Long and with Ringling the next week regarding scheduling an interview.
Ms. Davidson on June 22, 1989 faxed Ms. Long's resume to Ann Marie Patton at Ringling, with the following note: "Ann Marie Here is Pam Long's resume. I will follow up with you on Monday. Have a good weekend. Thanks Jessie." On June 27, 1989, Ms. Davidson again faxed Ms. Long's resume to Ringling. This time, she addressed the transmission to Andy Zion, Ringling's Controller. The message stated, "Andy I spoke briefly w/Diana and Ann Marie about Pam. Diana suggested that I fax you her resume. Please let me know one way or the other. Thank you Jessica."
On June 27, 1989, according to Plaintiff, Ms. Davidson called Plaintiff and told her that "it did not look good" for Ms. Long's prospects for employment at Ringling. When Ms. Long asked her what that meant, Ms. Davidson told her that Ringling did not want to interview her because she was a woman and that Ringling was seeking a man for the position. When Plaintiff requested clarification, Ms. Davidson, purportedly, said that Ringling thought a woman would not be effective in that position because of the cultural bias against women in Japan, and that Ringling was concerned about a woman travelling alone in a foreign country.
Mark Antalosky testified that he executed a Job Order Form for the road controller position advertised by Ringling. He stated that he prepared the form at the direction of Ann Marie Patton, who was then Engagement Accounting Manager with Ringling. She provided him with the relevant information regarding the job, which he then hand wrote onto the form. The job order and the information thereon, which Mr. Antalosky indicated he had received from Ms. Patton, specifically stated that Ringling sought "a male" to fill the position, and that it was looking for someone who had a "good image, not a womanizer." When questioned about why he wrote "a male," Mr. Antalosky testified that he specifically remembered the word male and that Ms. Patton had told him that Ringling preferred a male. Mr. James Mungnolo, the President and owner of MBA, testified that he designed the job order format and that his recruiters (i.e. Antalosky) were trained to execute and accurately fill out the job order form.
Prior to and up to the relevant period of this incident, Ringling had never hired a female road controller for an international show.
Ms. Patton denied expressing to Mr. Antalosky that Ringling preferred a male candidate. She admits, however, the accuracy of some of the information on the job order form, including the desire to hire someone who was not a womanizer. Ms. Patton does not know who placed the job ad (she testified that it was probably Andy Zion, her supervisor) but claims that fluency in Japanese was not essential and that the ad and the job order form incorrectly stated such a requirement. Ms. Patton also disputes some information contained in a letter written by Ringling's corporate attorney, Robert Fleshner, Esq., outlining Ringling's answers in response to questions propounded by EEOC during its investigation. Specifically, Ms. Patton disputes that fluency in Japanese was *1558 important and that Ringling did not interview anyone who submitted a resume. Ms. Patton testified that she did interview persons (probably at least a female) and may have interviewed Plaintiff, Ms. Long. Finally, Ms. Patton stated that Ringling required extensive training for the road controller position. Although this requirement was not placed on the job order form, Ms. Patton says that the end of May 1989 was the latest that an outside person could be hired because of the extensive (two months) training required of the one who was to assume the road controller position on July 12, 1989, which was the date the ice show began. While she does not remember when the job opening closed, Ms. Patton testified that there was no opening on June 22, 1989 when Plaintiff applied in view of the inability to provide her extensive training in time for the start of the tour.[1] Ultimately, Ringling assigned Jerry Guido, one of its experienced road controllers, to the Japanese ice show tour. He arrived in Japan around July 10, 1989, two days before the tour began.
Andrew Zino, Ringling's Controller at that time and Ms. Patton's supervisor, testified that fluency in Japanese was important and that the job order description requiring such fluency was accurate.[2] Mr. Zino testified that he did not interview anyone, that he assumed that Ms. Patton placed the ad, and that Ms. Patton made the ultimate hiring decision. Mr. Zino also acknowledged that all road controllers had to be trained but that training varied and did not require a set period. Training, according to Mr. Zino, was based "on the background of the applicant and how fast they could pick it up". Mr. Zino acknowledged that it was possible for the training to be less than two months and could possibly be provided in two weeks though such would be unusual.
Greg Suzuki, a road controller for Ringling, testified for Ringling with reference to the extensive training Ringling provided road controllers in the area of auditing; conducting settlements of expenses, receipts, and royalties; and in preparing and handling payroll and disbursements. While Mr. Suzuki did not have the academic nor the accounting experience when Ringling hired him as compared to Plaintiff, he stated that in his opinion a two month training period was necessary. Mr. Suzuki acknowledged, however that a background similar to Plaintiff's would be helpful and would facilitate understanding. Jerry Guido, a witness for Ringling, stated that there were no set or formal training programs but that there was on-the-job training. When asked whether it was possible for one with 13 years of relevant experience to be trained in three weeks for the road controller position, Guido indicated that it would be difficult, but that it was possible that the required training would be less.
The ice show tour in question arrived in Japan on July 5, 1989 and concluded in October of 1989. When Ringling hired road controllers for a tour it generally employed them permanently and assigned them in the corporate office between shows. The job order provided that the position would lead to more responsibilities in the corporate office. Both the job order and the job ad indicated travel, and other benefits.
II. LEGAL STANDARD
Title VII provides, in pertinent part, that it is unlawful for an employer to refuse to hire any individual because of the individual's sex. 42 U.S.C. § 2000e-2(a). The elements of a prima facie case alleging discriminatory treatment in a Title VII case are set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S. Ct. 1817, 36 L. Ed. 2d 668 (1973). *1559 The Supreme Court stated that the Plaintiff in a Title VII case has the burden of showing "(i) that she is a member of a class protected by Title VII; (ii) that she applied and was qualified for a job for which the employer was seeking applicants; (iii) that, despite her qualifications, she was rejected; and (iv) that, after her rejection, the position remained open and the employer continued to seek applicants from persons of complainant's qualifications."
Once the Plaintiff establishes a prima facie case, a presumption is created that the employer unlawfully discriminated against the employee. Texas Dept. of Community Affairs v. Burdine, 450 U.S. 248, 101 S. Ct. 1089, 67 L. Ed. 2d 207 (1981).
"The burden that shifts to the Defendant, therefore, is to rebut the presumption of discrimination by producing evidence that the Plaintiff was rejected, or someone else was preferred, for a legitimate, non-discriminatory reason. The Defendant need not persuade the Court that it was actually motivated by the proffered reasons ... It is sufficient if the Defendant's evidence raises a genuine issue of fact as to whether it discriminated against the Plaintiff."
Id. at 254-255, 101 S.Ct. at 1094-95.
If the employer meets this burden, then the burden shifts back to the Plaintiff to prove that the employer's reasons are false and, instead, serve as a pretext for discrimination. Finally, the Plaintiff always bears the ultimate burden of proving that the employer intentionally discriminated against her.
III. DISCUSSION
A. Liability
Preliminarily, the Court is satisfied that Plaintiff presented a prima facie case of discrimination under Title VII. Plaintiff, an Asian American female, clearly met the qualifications set forth in the job ad when she applied for the position on June 19, 1989. There was ample testimony and supporting documentation by way of the job order form to conclude that Ringling preferred a male for the road controller position and was looking for a person who had a "good image and not a womanizer". According to Plaintiff Ringling did not interview her, and Jessica Davidson informed Plaintiff that Ringling did not want to interview her because she was a woman and Ringling was looking or seeking a man for the position.
In response to the shifting burden, Ringling maintains that it did not discriminate against Plaintiff because of her gender, but that at the time Plaintiff applied, there was no time to provide her with training to permit her to serve as the road controller on the Japanese tour. In other words, Ringling articulates the untimeliness of Plaintiff's application for the position as its legitimate non-discriminatory reason for not hiring her. Plaintiff contends that Ringling's assertion of untimeliness is false and constitutes a pretext for discrimination. There is no dispute that Jerry Guido, a male who was then employed with Ringling, filled the position.
The Court finds Ringling's non-discriminatory reason for neither interviewing nor employing Plaintiff incredulous. Not only was Ms. Patton unable to state precisely when Ringling closed the position for road controller, but a review of Jessica Davidson's deposition testimony further convinces the Court that the position was still open when Plaintiff applied. Ms. Davidson accepted Plaintiff's resume and application and testified: "Well, I'm sure that I wouldn't have recruited somebody if I didn't think that the job order was open". In addition, Ringling never responded to the two faxed letters or, in any way, advised MBA personnel that the position was no longer open. Moreover, Ringling's own witnesses presented conflicting testimony as to the extent and length of training required in order for Plaintiff to assume the road controller position by July 12, 1989. While Anne Marie Patton testified that Ringling required two month training period for road controllers, Jerry Guido testified that Ringling had no set period for training. He further conceded that the training period could have been shorter for someone of Plaintiff's experience. Even Andrew Zino, Ringling's former Controller, testified that training varied and that Ringling did not have a set period for training.
The Court notes further that neither the ad nor the job order form made any reference *1560 to a two month training period as a prerequisite for employment. Despite Ms. Patton's claims that fluency in Japanese was not essential, that she did not say to Mr. Antalosky that Ringling was looking for a male, that she may have interviewed Plaintiff, and that the position was no longer open when Plaintiff applied because Ringling could not provide her with the two months of training in time for the start of the ice tour on July 12, 1989, the Court believes there is a mound of evidence contradicting Ms. Patton's testimony. The Court, therefore, rejects Ms. Patton's testimony as self-serving and lacking in credibility.
In view of Plaintiff's vast experience in accounting, and her knowledge of personal computers, together with her fluency in Japanese, the Court believes that Ringling could have trained Plaintiff for the road controller position in less than two months and in time to join the tour on July 12, 1989. The Court, specifically, finds that Plaintiff filed her application for the position in a timely manner.
Based upon the Court's review of the entire record, including the testimony and all exhibits, and having assessed the witnesses and their credibility, the Court is persuaded that the evidence establishes that Ringling's reason for not interviewing or hiring Plaintiff was not gender neutral. The Court is convinced and does find that Plaintiff did establish the pretextual nature undergirding Ringling's decision not to hire her.
This Court finds that Ringling's explanation (that the application was untimely and that the position was no longer open) for not hiring Plaintiff was pretextual because: (a) the overwhelming evidence, in the opinion of the Court, is that there was no set or rigid two month training period for the position of road controller; (b) there was no mention in the job order form nor in the job ad that a two month training period was required; and (c) with the exception of Ms. Patton's assertion, (advanced for the first time nearly four and a half years after the inception of this litigation), that the position was no longer available on June 19, (or June 22 when Ringling received the fax of the resume) 1989, all other witnesses and evidence convinces this Court that the position was still open when Plaintiff applied.
The Court believes that Ringling has articulated no more than an after-the-fact attempt to legitimize an unlawful discriminatory decision not to interview nor employ Plaintiff. The Court further believes that Plaintiff has established that Ringling's alleged legitimate non-discriminatory reason is not worthy of credence. The evidence thoroughly convinces the Court that Plaintiff's academic credentials, work experience, and fluency in Japanese (which the Court finds was essential to the position) made her eminently qualified for an interview and employment. The information on the job order form coupled with the testimony of Plaintiff and Mr. Antalosky establishes, in the opinion of this Court, that Ringling wanted a male and that Plaintiff was rejected because she was a woman. The Court further finds that Ringling has failed to prove and has failed to convince this Court that, notwithstanding the actions by Ringling being motivated by improper gender considerations, Plaintiff could not have obtained this position because of the inability to receive timely training. As mentioned previously, the Court finds that training varied and that time for adequate training was still available. Having rejected Ringling's proffered reason for not interviewing nor hiring Plaintiff, the Court reaches the ultimate conclusion that Ringling's decisions were motivated by intentional discriminatory considerations, and that Plaintiff did prove by a preponderance of the evidence that Ringling intentionally discriminated against her because of her sex/gender.
B. Damages
Under Title VII a prevailing Plaintiff is entitled to "make whole" relief. Franks v. Bowman Transp. Co., 424 U.S. 747, 763, 96 S. Ct. 1251, 1263, 47 L. Ed. 2d 444 (1976). This may include the value of fringe benefits. See, e.g., Crabtree v. Baptist Hosp., 749 F.2d 1501 (11th Cir.1985) (permitting recovery of executive retirement benefits); Kolb v. Goldring, Inc., 694 F.2d 869, 873-74 (1st Cir.1982) (ADEA, part of expense account provided to employee for discretionary use); Walker v. Ford Motor Co., *1561 684 F.2d 1355, 1364 (11th Cir.1982) (dicta). Plaintiff clearly is entitled to a back pay award pursuant to 42 U.S.C. § 2000e-5(g). In light of Title VII's policy to make whole a victim of discrimination, the award of back pay should include not only the straight salary, but raises and fringe benefits, as well, which Plaintiff would have received but for the intentional discrimination.
The Court, therefore, can award Plaintiff back pay and any lost fringe benefits proven from the date she was to assume the position to trial/judgment. This amount should then be offset by Plaintiff's actual earnings and fringe benefits during the same time period. The offset is mandated by the duty under Title VII on Plaintiff to mitigate its back pay award through reasonable and diligent efforts to secure employment. Title VII also authorizes the Court to award reasonable attorney fees to the prevailing party as part of costs.
In view of the testimony and evidence that road controllers would be provided opportunities to work in Ringling's corporate headquarters at the end of the tour and in between tours, the Court finds that the damages (and the measure thereof) continues to the date of trial. The Court further finds that Plaintiff mitigated her damages and made reasonable, diligent and sufficient efforts to seek and maintain employment during the period from July/August 1989 to February/March 1995.
1. Salary/Raises
With reference to the issue of salary and raises, the Court heard testimony from Ms. Patton that the salary range for road controllers to be hired in June/July of 1989 was between $20-25,000. She indicated that although her supervisor would actually set the salary, Ringling would not have given the person hired any extra salary considerations for his/her experience, and that Ringling had never hired anyone similar in experience as Plaintiff who possessed 13 years of accounting experience. This testimony conflicted with the ad and the job order form which set the salary range around $30,000 per year. There was evidence that Jerry Guido, who ultimately assumed the road controller position, started in 1986 at a salary of $21,000; that Greg Suzuki (another road controller for Ringling) received a starting salary in 1986 at $24,000; and that Robert Pinard (who was initially selected to assume the road controller position in question) started in 1988 at a salary of $20,000.
The evidence further reflected that Mr. Pinard received bonuses of $350 in 1989 and $2750 in 1990, and that his annual salary went to $21,000 in 1989 and then to $25,200 in 1990.[3] This represented an approximately 13% annual increase in salary for the two year period of his employment. Mr. Zuzuki, who started with Ringling at $24,000, testified that his salary in 1989 was $32,000 which represented about an 11% annual increase for those three years. While the Court heard and reviewed evidence that bonuses were paid, the Court was not provided an adequate factual basis upon which to reasonably determine the specific amount and extent of bonuses to which Plaintiff would have earned since July/August of 1989. Nevertheless, the Court believes that, but for the discriminatory decision not to hire Plaintiff, Plaintiff qualified for and would have been employed at the announced salary level of $30,000 and would have earned, as did the aforementioned other road controllers, reasonable raises and bonuses. The Court, therefore, finds that an annual salary increase of 10% reasonably compensates Plaintiff for increases and bonuses.
Accordingly, had Ringling hired Plaintiff, her starting salary plus annual ten percent (10%) raises and total lost wages would reflect the following:
August 1, 1989July 31, 1990 $ 30,000.00
August 1, 1990July 31, 1991 $ 33,000.00
August 1, 1991July 31, 1992 $ 36,300.00
August 1, 1992July 31, 1993 $ 39,930.00
August 1, 1993July 31, 1994 $ 43,923.00
August 1, 1994February 28, 1995 $ 28,183.93
___________
Total Lost Wages $211,336.93
Plaintiff's employment history and actual salary earned during the period in question can be summarized as follows:
*1562
August 1, 1989December 31, 1990 $ 50,227.00
January 1, 1991December 31, 1991 $ 31,782.50
January 1, 1992December 31, 1992 $ 31,782.50
January 1, 1993December 31, 1993 $ 16,995.74
January 1, 1994December 31, 1994 $ 36,250.00
January 1, 1995February 28, 1995 $ 6,041.67
___________
Total $173,079.41
Plaintiff is, therefore, entitled to a (net) loss of salary and raises in the amount of $38,257.52.[4]
The Court has not been given sufficient reasons to justify front pay, and accordingly, declines to award front pay damages.
2. Fringe Benefits
The Court has spent a great deal of time and energy following the conclusion of the hearing reviewing the testimony, exhibits, and the entire record in an effort to determine the extent, the amount, and the value of fringe benefits Plaintiff is entitled to be awarded as part of her back pay damages. The Court concludes that it is unable to determine the value of fringe benefits with reasonable certainty on the record before it. Preliminarily, the uncontradicted evidence is that the Japanese Tour (which was where Plaintiff would be assigned) would last four (4) months until sometime in October,1989. While it was anticipated that Plaintiff would then be sent to the corporate office to work, there is nothing in the record to support Plaintiff's request for continuous fringe benefits for five and a half years. The Court does not believe that it should guess the value of fringe benefits for four months. Moreover, the record is devoid of what, if any, value of fringe benefits Plaintiff received on her other jobs in mitigation.
The Plaintiff claims the value of food from August 1989 to March 1995. The testimony of two road controllers was that road controllers in Japan and while on tour were guaranteed one (1) hot meal by the promoter when there were three shows in a day. On all other occasions, the employees paid for their meals. The Court does not know nor did Plaintiff provide any basis to determine the value of one hot meal. Accordingly, the Court will not award Plaintiff damages for meal expenses.
Plaintiff also claims travel (including relocation costs) and transportation costs; however, Plaintiff never made the trip nor incurred expenses, and the testimony indicated and convinced the Court that the promoter provided a bus and, perhaps, a cab when needed, to transport the employees only to and from the hotel to the shows, performances, or both. The Court, therefore, will not award Plaintiff the value of a car rental, and certainly not for five-and-one-half years.
The Plaintiff claims board. The testimony was that the road controller was entitled to free board. Plaintiff attempts to itemize her housing expenses on her home in Laurel, Maryland. She suggest that she and her husband would have saved, if hired, over $100,000 in mortgage payments, utilities, water and trash pick-up, and house maintenance. As the Court stated previously, the fringe benefit of free board covered the four month tour. In the absence of evidence that Plaintiff would be on continuous International tour and not spending time in the corporate office (where she would have a normal house note or rental payment) this Court simply has no basis to accept this claim. Moreover, whether and when Plaintiff and her husband would have been able to either sell or quickly lease their house in July at the start of the tour, amounts to no more than sheer speculation.
Finally, Plaintiff claims damages for Health and Insurance benefits lost. Again the Court believes that it is unable, on this record, to decipher the actual value of this benefit. This is particularly the case when considering the need to ascertain the deductibles, and the need to compare the actual *1563 costs of health coverage to Plaintiff while employed at her several positions as opposed to the health insurance cost at Ringling. In short, the Court does not believe that Plaintiff has shown by a preponderance of the evidence what amount (with a degree of reasonable certainty) of fringe benefits she is entitled to be awarded.
IV. FINDINGS OF FACT
(SUMMARY)
1. Plaintiff Pamela Long is a Japanese-American female.
2. Plaintiff saw a job listing ad for a road controller in the Japanese Information and Cultural Center in Washington, D.C., in June 1989.
3. Plaintiff responded to the posting on June 19, 1989, by calling Jessica Davidson, who was an account executive with MBA Management, Inc. ("MBA"). MBA is an employment agency with which Ringling had been in contact in its desire to fill the road controller position.
4. Ms. Long and Ms. Davidson met on June 19, 1989 at which time Ms. Davidson interviewed Ms. Long for the position.
5. After reviewing Ms. Long's Data Sheet and resume, Ms. Davidson believed that Ms. Long was a qualified applicant.
6. On June 20, 1989, Ms. Davidson faxed Plaintiff's resume to Ann Marie Patton at Ringling, with the following note: "Ann Marie Here is Pam Long's resume. I will follow up with you on Monday. Have a good weekend. Thanks Jessie." (Plaintiff's Exhibit J).
7. On June 27, 1989, Ms. Davidson again faxed Ms. Long's resume to Andy Zion [sic], Controller at Ringling. The message stated: "Andy I spoke briefly w/Diana and Ann Marie about Pam. Diana suggested that I fax you her resume. Please let me know one way or the other. Thank you Jessie."
8. On June 27, 1989, Ms. Davidson called Ms. Long and told her that "it did not look good" for Ms. Long at Ringling. When Ms. Long asked her what that meant, Ms. Davidson told her that Ringling did not want to interview her because she was a woman, and that Ringling was seeking a man for the position. When Ms. Long requested clarification of what that meant, Ms. Davidson said that Ringling thought a woman would not be effective in that position because of the cultural bias against women in Japan, and that Ringling was concerned about a woman travelling alone in a foreign country.
9. Plaintiff met all of the job qualifications in that she spoke fluent Japanese, held a master's degree in accounting, had relevant work experience in accounting, and was willing to relocate in Japan and travel extensively.
10. Plaintiff was never interviewed for the position.
11. Mark Antalosky, who was an Account Executive with MBA in 1989, executed a Job Order Form for the road controller position advertised by Ringling. He prepared the form at the direction of Ann Marie Patton, who was then Engagement Accounting Manager with Ringling. She provided him with the relevant information regarding the job, which he then accurately put on the form.
12. The Job Order Form specifically stated that Ringling sought "a male" to fill the road controller position, and that it was looking for someone who had a "good image, not a womanizer."
13. Mr. Antalosky, particularly, remembered that Ms. Patton had told him that she would prefer a male.
14. Ms. Patton admitted that she did tell Mr. Antalosky that Ringling wanted someone who was "not a womanizer."
15. That prior to and throughout the relevant time period, Ringling had never hired a female road controller on an international show.
16. That fluency in Japanese was very important and Plaintiff having been born in Japan spoke fluent Japanese.
17. That the position of road controller was still open when Plaintiff applied on June 22, 1989.
18. That the length of training for the position of road controller varied according to the experience of the person hired and *1564 how quickly the person could learn the system.
19. That based upon Plaintiff's extensive experience in accounting, her fluency in Japanese and her educational background, Plaintiff could have assumed the position of road controller with less than 2 months training.
20. That Plaintiff's application on June 22, 1989 for the position of road controller was timely submitted.
21. That Ringling generally hired its road controllers for permanent positions, and in between shows the road controller worked in the corporate office.
22. That Ringling's decision to not interview or hire Plaintiff for the road controller position was the result of intentional discrimination based upon her gender.
23. Plaintiff would have earned (salary and raises) approximately $211,336.93 from August 1, 1989 to February 28, 1995 had she been employed by Ringling.
24. Plaintiff did actually earn $173,079.41 from August 1, 1989 to February 28, 1995 through other employment.
25. Plaintiff has suffered a total net loss of $38,257.52 in salary and raises for the period in question because of the intentional discrimination by Ringling.
26. Plaintiff has not proven by a preponderance of the evidence nor has Plaintiff established with any degree of reasonable certainty the extent and value of fringe benefits to justify an award of damages for loss of fringe benefits.
V. CONCLUSIONS OF LAW
A. JURISDICTION
1. This action is properly brought by the United States to enforce Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e, et seq. Ringling discriminated against Pamela E. Long by failing or refusing to interview or employ her as road controller because of her sex in violation of Title VII.
2. The Court has jurisdiction of the subject matter and the parties in this action pursuant to 42 U.S.C. § 2000e-5(f) and 28 U.S.C. § 1345.
3. Venue is properly laid in this District, and all proper, necessary and appropriate parties have been made parties in this civil action.
4. All conditions precedent to the filing of suit have been performed or have occurred.
B. BURDEN OF PROOF
5. A prima facie case of discrimination under Title VII is established by showing that the individual for whom relief is requested is a member of a protected group, was qualified for the job for which she applied, was rejected, and the position was subsequently filed by a person outside of the protected group. Once the Plaintiff establishes a prima facie case of discrimination, Ringling may then articulate a legitimate, non-discriminatory reason for its decision. Finally, the Plaintiff must be accorded an opportunity to show that Ringling's proffered legitimate, non-discriminatory reason or reasons are pretexts for discrimination. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S. Ct. 1817, 36 L. Ed. 2d 668 (1973). Accord Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 101 S. Ct. 1089, 67 L. Ed. 2d 207 (1981). Pretext can be shown "either directly by persuading the court that a discriminatory reason more likely motivated the employer or indirectly by showing that the employer's proffered explanation is unworthy of credence." Burdine, 450 U.S. at 256, 101 S.Ct. at 1095.
6. A prima facie case of discrimination under McDonnell Douglas, supra, was established at trial: Pamela E. Long is female and therefore a member of a protected group. She was qualified for the road controller position for which she applied. Ms. Long was not hired and Ringling subsequently filled the position with Jerry Guido, a male.
C. RINGLING'S PROFFERED EXPLANATIONS ARE PRETEXTUAL
7. Ringling's reliance on the untimeliness of Plaintiff's application for the position of road controller as a basis to not interview or *1565 hire Plaintiff is an attempt to mask a discriminatory motive. Ringling has failed to offer any legitimate, non-discriminatory reasons for its decisions.
8. In view of Plaintiff's clear qualifications for the position, together with the evidence of Ringling's expressed preference for a male convinces the Court that Plaintiff has demonstrated by a preponderance of the evidence that she was refused an interview and not employed because of her sex.
9. That Ringling's reasons proffered as explanations are pretextual.
D. LIABILITY
10. That Ringling intentionally discriminated against Plaintiff because of her sex.
E. RELIEF/DAMAGES
11. That Plaintiff be awarded damages for loss of back pay in the amount of $38,257.52.
12. That as the prevailing party, Plaintiff be awarded costs and attorney fees pursuant to 42 U.S.C. § 2000e-5(k) and in accordance with Local Rule 109.1 & 2.
NOTES
[1] The Court notes, as it indicated in the February 10, 1995 Memorandum Opinion denying Ringling's motion for summary judgment, that this timeliness argument only recently became a genuine issue and apparently was not seriously raised in either the EEOC proceeding nor during the approximately four years of Court litigation before the United States District Court and the United States Court of Appeals For The Fourth Circuit. This Court will make a finding as to whether Plaintiff made a timely application for the road controller's position.
[2] The deposition testimony of Jessica Davidson ("and the big thing that I was looking for was someone who would speak Japanese") also supports the testimony of Mr. Zino and disputes Ms. Patton's testimony that fluency in Japanese was not essential.
[3] Mr. Pinard was terminated on October 12, 1990.
[4] The Court recognizes that the amount earned (including benefits) for the period in question is in dispute. Ringling's position is that Plaintiff earned $205,250.00; Plaintiff's Exhibit V suggests an actual compensatory amount of $141,256.91, however, the Court's review and calculation of the items presented by Plaintiff in Exhibit V comes to $173,079.41. Other evidence presented (e.g. W-2 forms) reflect slightly different amounts of wages earned by Plaintiff for portions of the period in question. This Court finds that the annual amounts presented in Exhibit V reasonably reflect the wages Plaintiff actually earned from August, 1989 to February, 1995. Accordingly, the Court finds the net loss to be $38,257.52. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603577/ | 645 So. 2d 1098 (1994)
Thomas WEEMS, Appellant,
v.
STATE of Florida, Appellee.
No. 92-3141.
District Court of Appeal of Florida, Fourth District.
November 30, 1994.
*1099 Richard L. Jorandby, Public Defender, and Anthony Calvello, Asst. Public Defender, West Palm Beach, for appellant.
Robert A. Butterworth, Atty. Gen., Tallahassee, and Sarah B. Mayer, Asst. Atty. Gen., West Palm Beach, for appellee.
ON MOTION FOR REHEARING
STONE, Judge.
Appellant's motion for rehearing is denied. However, we withdraw our opinion of September 9, 1994, and substitute the following opinion.
Appellant's conviction and sentence are affirmed. We find no error or abuse of discretion as to any issue raised, including the trial court's denial of appointed counsel's motion to withdraw, the extent of the inquiry into Appellant's request to discharge counsel, or the court's failure to advise Appellant that upon discharge of his attorney the court would not be required to appoint substitute counsel.
The conflict between client and counsel involved Appellant's complaints about how the attorney was handling the case and the lawyer's concerns about Appellant's, attitude, communication difficulties and lack of cooperation. The record is replete with evidence demonstrating the client's mental and emotional instability, including expert testimony as to his competency to stand trial. The record reflects a reasonable inquiry by the trial court. The decision denying the motions should not be disturbed absent a clear abuse of discretion. E.g., Sanborn v. State, 474 So. 2d 309 (Fla. 3d DCA 1985). A generalized loss of confidence or lack of cooperation alone is insufficient to mandate withdrawal by counsel. See Johnston v. State, 497 So. 2d 863 (Fla. 1986). Here, it is highly unlikely that a substitute public defender would have fared any better, as counsel candidly acknowledged to the court.
Further, as the court did not discharge counsel, it was not per se reversible error to fail to advise Appellant that if his lawyer were discharged the court was not required to appoint a new attorney. See generally Hardwick v. State, 521 So. 2d 1071 (Fla. 1988), cert. denied, 488 U.S. 871, 109 S. Ct. 185, 102 L. Ed. 2d 154 (1988). See also Causey v. State, 623 So. 2d 617 (Fla. 4th DCA 1993), rev. denied, 634 So. 2d 623 (Fla. 1994). Such a warning is required where counsel is discharged. Nelson v. State, 274 So. 2d 256, 259 (Fla. 4th DCA 1973), approved in Hardwick v. State, 521 So.2d at 1074-75. However, we can discern no reason to reverse upon the failure to give such a warning when the court denies the discharge motion and the failure to so advise Appellant is patently harmless. We note that in this case, Appellant was not seeking to represent himself; therefore, Faretta v. California, 422 U.S. 806, 95 S. Ct. 2525, 45 L. Ed. 2d 562 (1975), is inapposite.
We have considered, and do not believe this opinion is in conflict with, our decisions in Graves v. State, 642 So. 2d 142 (Fla. 4th DCA 1994); Dunn v. State, 640 So. 2d 201 (Fla. 4th DCA 1994); and Lewis v. State, 623 So. 2d 1205 (Fla. 4th DCA 1993). In Graves, the issue was failure to conduct an otherwise required Nelson inquiry because the defendant's motions were made pro se while represented by counsel. In Dunn, there was no inquiry at all. In Lewis, as here, there was an inquiry but the state did not contend that any error in failing to completely advise the defendant was harmless error.[1] Further, this opinion is consistent with Causey, where the court did fully inquire into a motion to withdraw but stopped short of advising Appellant that if appointed counsel were discharged, the court would not be required to appoint substitute counsel. In Causey, we said:
[t]he requirement to give this advice when a defendant seeks to discharge counsel does not mandate per se reversal every time a court may fail to do so upon learning that the defendant has expressed dissatisfaction with counsel, a daily occurrence in many trial courts. Here there was no question of Appellant's wish to be represented by court-appointed counsel.
*1100 623 So.2d at 618. In Causey, we also found any error was harmless.
There is record support for the court's conclusion, albeit on conflicting evidence, that Appellant was competent to stand trial. Carter v. State, 576 So. 2d 1291 (Fla. 1989), cert. denied, 502 U.S. 879, 112 S. Ct. 225, 116 L. Ed. 2d 182 (1991). Further, we find no abuse of discretion in the court's failing to conduct an additional competency hearing at trial, three months after the initial competency finding, as nothing in the record suggests a demonstrable change in Appellant's condition during the 90-day interim. See White v. State, 548 So. 2d 765 (Fla. 1st DCA 1989), rev. denied, 562 So. 2d 348 (Fla. 1990).
Concerning the sentencing issues raised, we affirm on the authority of State v. Rucker, 613 So. 2d 460 (Fla. 1993). Additionally, it was Appellant's responsibility to bring to the court's attention evidence, if any, that a prior conviction used in imposing habitual offender status was set aside or the subject of a pardon.
As to all other issues raised, we also find no error, or that any error was harmless. State v. DiGuilio, 491 So. 2d 1129 (Fla. 1986).
GLICKSTEIN and KLEIN, JJ., concur.
NOTES
[1] We do not address here the question of whether the court can consider a harmless error analysis when not raised by the state. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603590/ | 645 So. 2d 1215 (1994)
STATE of Louisiana
v.
Alton P. CUREAUX.
No. 93-KA-0838.
Court of Appeal of Louisiana, Fourth Circuit.
October 27, 1994.
*1216 Harry F. Connick, Dist. Atty., Mark D. Pethke, Asst. Dist. Atty., New Orleans, for appellee.
Sheila C. Myers, New Orleans, for appellant.
Before SCHOTT, C.J., and BYRNES and WALTZER, JJ.
BYRNES, Judge.
Alton P. Cureaux appeals his conviction of attempted possession of cocaine with intent to distribute, as well as his conviction as a second offender for which he was sentenced to 30 years at hard labor. We affirm.
On October 3, 1991, at approximately 1:45 p.m., Officers Larry Matthews and Kenneth Taylor responded to a dispatch call and drove to the intersection of Spain and North Derbigny. When they were a block away, the officers saw the defendant place a paper bag into the base of a hollow tree and walk across the street to an abandoned house. The officers testified that no one else, other than a young woman standing on the porch of the abandoned house, was in the area.
The officers parked their car and exited. Officer Matthews detained the defendant and the young woman while Officer Taylor retrieved the bag from the base of the tree. Officer Taylor testified that there were no other bags in the tree. The bag contained 42 rocks of crack cocaine. The defendant was searched, and $324.00 was found in his front pocket.
Dawn Robinson testified that as she left a store at the corner of Derbigny and Spain, she saw the police arrive and stop the defendant. She also saw them remove a bag from a tree, and she testified that before the police stopped him, the defendant was on the other side of the street from the tree. She also testified that there were quite a few people in the area but that they left when the police arrived.
Michael Hubbard testified that he lived at the corner of Spain and Prieur and that he saw a police car stop at the corner of Spain and Derbigny. He saw police officers order the defendant to halt while several people at *1217 the corner scattered. He also testified that he saw one of the police officers remove a paper bag from the base of a tree. Hubbard further testified that he told the police that they had the wrong man and that the right ones were the youngsters who were running away.
Nicole Augustine testified that defendant had come to visit her that day and that there were several people on the corner at the time the police arrived. She also testified that she did not see him put anything inside a tree.
The defendant was charged with possession of cocaine with intent to distribute. Following a mistrial on March 17, 1992, the defendant was found guilty of attempted possession of cocaine with intent to distribute after a jury trial on August 17, 1992. The defendant admitted to being a second offender on September 1, 1992, and he was sentenced to 30 years at hard labor.
After the appeal was lodged, defendant moved for a new trial on the basis of newly discovered evidence on August 18, 1993. The case was remanded to the trial court, a hearing was held on November 2 and 16, 1993, and the trial court denied the motion on November 30.
On appeal Alton P. Cureaux contends that: (1) the trial court erred in denying his motion for new trial; and, (2) the prosecutor commented improperly during closing argument.
The defendant complains that the trial court erred in denying his motion for new trial which was based on newly discovered evidence related to the credibility of Officer Kenneth Taylor. Officer Taylor testified at trial that he had been a police officer for four years. Several months after the trial, an article appeared in the Times-Picayune that stated that Officer Taylor had been suspended from the New Orleans Police Department from September, 1988 to January, 1990 for cheating.
The defendant argues that he had no reason to suspect that such information about Officer Taylor existed; thus, he contends his failure to obtain the information before trial cannot be attributed to a lack of due diligence. He further argues that because the case was a swearing match between the state's witnesses, the two police officers, and the three defense witnesses, the credibility of Officer Taylor was an important issue. The defendant asserts that the newly discovered impeachment evidence would have resulted in a different verdict.
To obtain a new trial under Article 851(3), the defendant has the burden of showing: (1) the new evidence was discovered after trial; (2) the failure to discover the evidence at the time of the trial was not caused by the lack of diligence; (3) the evidence is material to the issues at trial; and, (4) the evidence is of such a nature that it would probably have changed the verdict. The test for determining whether new evidence warrants a new trial is not whether another jury might bring a different verdict but, rather, whether the new evidence is so material that it ought to produce a verdict different from that rendered at trial. State v. Molinario, 400 So. 2d 596 (La.1981); State v. Wright, 598 So. 2d 561 (La.App. 4th Cir. 1992). To reverse the denial of a motion for new trial, the reviewing court must find that the denial was arbitrary and a palpable abuse of the trial court's discretion. State v. Clark, 581 So. 2d 747 (La.App. 4th Cir.1991), writ denied 590 So. 2d 63 (La.1991). Great weight is to be attached to the exercise of the trial court's discretion, which should not be disturbed even if reasonable persons could differ as to the propriety of the trial court's action. Id.
When he denied the motion for new trial, the trial judge stated:
The Court finds that the issue as to how long the officer may have served and whether or not he was suspended for some period of time in the course of his initial service and then reinstatement, the issue of whether he cheated on the exam or not that led to this suspension, dismissal and ultimate reinstatement would be a collateral issue as I appreciate Article 607 of the evidence code and the jurisprudence that preceded and has followed that Article's creation, such is not the type of evidence that is subject to impeachment, more particularly *1218 collateral issues, collateral evidence.[1]...
Although the defendant could impeach Officer Taylor's testimony that he had been a police officer for four years with extrinsic evidence that Officer Taylor had been suspended from the police force for some sixteen months, the defendant could not have gone into the basis for the suspension under LSA-C.E. art. 608 B. Article 608 B provides that: "Particular acts, vices, or courses of conduct by a witness may not be inquired into or proved by extrinsic evidence for the purpose of attacking his character for truthfulness, other than conviction of crime as provided in Articles 609 and 609.1 or as constitutionally required." There is a real risk that once the fact of Officer Taylor's suspension is raised, the reason for the suspension (Officer Taylor's alleged cheating on an examination) would be explored. In turn, the reasons for Officer Taylor's reinstatement would be delved into. As a result, evidence of these collateral issues related to Officer Taylor's credibility is substantially outweighed by the risks of undue consumption of time, confusion of the issues, or unfair prejudice. We find no abuse in the trial court's discretion in denying the motion for new trial.
The defendant also contends that the prosecutor improperly commented during closing argument on the defendant's exercise of his constitutional right not to testify. He argues that the prosecutor's comments indirectly referred to his failure to testify and that the prosecutor intended to emphasize his failure to take the stand.
During closing argument the prosecutor stated:
It's important to realize in this trial, or as in any other trial, the mere fact that you've heard two different versions of what happened or somemaybe even today, more than two versions, maybe three different versions by the people who testified for the Defense. But the mere fact that you heard two versions of what happened, that, in and of itself, is not reasonable doubt. I know Mr. Brandt addressed that to you in the very beginning. That's important to realize. That's important to realize. Because, after all, if that was reasonable doubt, then every time there is a trial the defendant could either take the stand himself or have a witness take the stand and say, "No, I didn't do it." and part of your role is to be fair and impartial, so you wouldn't know the police officers and you wouldn't know the people who testified for the defendant, most likely. And, therefore, it would be easy to say, "Well, I don't know either one, so I don't know who's telling the truth; therefore, he's not guilty. Therefore, there's reasonable doubt; therefore, he's not guilty." That's not how it works for that very reason.
The Defense could always get up and say, "I didn't do it." and then you'd have that same predicament if you went with that theory.
The trial judge overruled defendant's objection to the prosecutor's statements.
LSA-C.Cr.P. art. 770 provides that a mistrial shall be ordered when a remark or comment made by a prosecutor during trial or argument either directly or indirectly refers to the defendant's failure to testify in his own defense. When the reference to the defendant's failure to testify is a direct one, a mistrial must be declared regardless of the effect the statement had on the jury. For an indirect reference to mandate a mistrial, the prosecutor must have intended to draw the jury's attention to the defendant's failure to testify. State v. Clay, 612 So. 2d 266 (La. App. 4th Cir.1992).
*1219 Rather than intending to focus the jury's attention on the defendant's failure to testify in the present case, the prosecutor was arguing to the jury that they could not conclude that reasonable doubt existed based solely on a denial of guilt by a defendant. The prosecution did not refer to the defendant Alton Cureaux but referred to defendants in general. The prosecutor stated: "... if that was reasonable doubt every time there is a trial the defendant could either take the stand or have a witness take the stand and say, `No, I didn't do it.'" The prosecutor referred to any trial and to any defendant whose trial strategy was to provide testimony to claim innocence. The prosecutor's comments were not an impermissible reference to the defendant's failure to testify in the present case.
Accordingly, the defendant's conviction and sentence are affirmed.
AFFIRMED.
NOTES
[1] LSA-C.E. art. 607 D provides:
D. Attacking credibility extrinsically. Except as otherwise provided by legislation:
(1) Extrinsic evidence to show a witness' bias, interest, corruption, or defect of capacity is admissible to attack the credibility of the witness.
(2) Other extrinsic evidence, including prior inconsistent statements and evidence contradicting the witness' testimony, is admissible when offered solely to attack the credibility of a witness unless the court determines that the probative value of the evidence on the issue of credibility is substantially outweighed by the risks of undue consumption of time, confusion of the issues, or unfair prejudice. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645335/ | 994 So.2d 308 (2008)
ARAUJO
v.
CHASE HOME FINANCE, LLC.
No. 2D08-4639.
District Court of Appeal of Florida, Second District.
October 27, 2008.
Decision without published opinion. App.dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604052/ | 645 So. 2d 66 (1994)
William DAVIS, Appellant,
v.
STATE of Florida, Appellee.
No. 93-3635.
District Court of Appeal of Florida, Fourth District.
November 9, 1994.
Clarification Denied December 1, 1994.
Richard L. Jorandby, Public Defender, and Marcy K. Allen, Asst. Public Defender, West Palm Beach, for appellant.
Robert A. Butterworth, Atty. Gen., Tallahassee, and Melynda L. Melear, Asst. Atty. Gen., West Palm Beach, for appellee.
*67 PARIENTE, Judge.
Defendant appeals the denial of his motion to dismiss the charge of possession of a firearm by a convicted felon, claiming it is barred by collateral estoppel. The issue before us is whether defendant has been placed in double jeopardy by his conviction for possession of a firearm by a convicted felon after a previous jury acquitted him of aggravated assault and carrying a concealed weapon arising from the same incident. Because we find that the jury necessarily decided that defendant did not possess a firearm in the incident, the doctrine of collateral estoppel and the constitutional prohibition against double jeopardy bar his subsequent prosecution and conviction for possession of a firearm by a convicted felon.
These charges all stem from defendant's attempt to flee police officers on July 29, 1992. The testimony at defendant's trial on charges of aggravated assault by pointing a handgun, carrying a concealed weapon and resisting arrest without violence, consisted of the accounts of two police officers and defendant. The officers both testified that as defendant fled, he pulled a gun from underneath his clothing which he pointed directly at the officers. Officer Brannen specifically testified:
Myself and Officer Roesser were behind him, we were approximately four feet apart, and we couldn't see what he was doing here, but when he turned back around he pointed the weapon directly at us and didn't point it at the ground, didn't point it at the air.
Officer Roesser also testified concerning the weapon:
He [defendant] fumbled in his pockets pants area, and at that time he turned around with a small caliber semi-automatic weapon and pointed it at myself and Officer Brannen and we both took evasive action in different directions.
Defendant testified and emphatically denied having a gun that evening.
The trial court instructed the jury not only on the offenses of aggravated assault on a police officer, carrying a concealed weapon and resisting arrest without violence, but also on the lesser included offenses of aggravated assault assault and improper exhibition of a firearm. The jury acquitted defendant of all charges and lesser included offenses which involved the handgun. Defendant was convicted only of the separate offense of resisting arrest without violence.
This court succinctly explained the application of collateral estoppel in State v. Strong, 593 So. 2d 1065, 1067 (Fla. 4th DCA), rev. denied, 602 So. 2d 942 (Fla. 1992):
From the fifth amendment guarantee against double jeopardy in the United States Constitution there has evolved the doctrine of collateral estoppel, which means that, when an issue of ultimate fact has been determined by a valid and final judgment, that issue cannot be relitigated between the same parties in any future lawsuit... . Collateral estoppel may be employed to bar prosecution or argumentation of facts necessarily established in a prior proceeding... . A necessarily established fact has been held to be one which has been resolved in favor of the defendant at the prior trial and was essential to the conviction in said case. However, as the court said in Ashe [v. Swenson, 397 U.S. 436, 90 S. Ct. 1189, 25 L. Ed. 2d 469 (1970)], collateral estoppel does not apply if the verdict could be grounded upon an issue other than that which the defendant seeks to foreclose from consideration.
Defendant had the burden to prove by convincing, competent evidence that it was necessary in the initial trial to determine the fact sought to be foreclosed. State v. Short, 513 So. 2d 679 (Fla. 2d DCA 1987). The trial court was required, upon appellant's motion based on collateral estoppel, to review the record and conclude whether a rational jury could have grounded its verdict upon an issue other than that which the defendant seeks to foreclose. Ashe, 397 U.S. at 444, 90 S.Ct. at 1194.
The state contends that the jury could have based its acquittal of the aggravated assault charge on a belief that defendant did not act in a threatening manner and its verdict on the concealed weapon charge on a belief that the state did not prove concealment. While we agree these contentions are *68 possible explanations which would not necessarily foreclose the issue of possession of a firearm, we find it difficult to believe a rational jury would have accepted part of the officers' trial testimony that defendant possessed a weapon but rejected their testimony that defendant pointed the gun directly at them. However, we need not resolve that conflict.
As defendant points out, the jury also acquitted him of the lesser included charge of improper exhibition of a firearm which requires proof only that the firearm was exhibited in a "rude or careless manner." If the jury had simply based its acquittal on the aggravated assault charge on its belief that defendant was more concerned with escape than threat, it had the option of finding defendant guilty of improper exhibition of a firearm if it believed the officers' testimony. A verdict of not guilty on this lesser offense as well leads us to the inescapable conclusion that the jury necessarily decided that defendant did not possess a firearm.
We find the reasoning of Gragg v. State, 429 So. 2d 1204, 1206 (Fla. 1983) to be persuasive, even though we agree with the state that the facts are not identical to the case before us. In rejecting the state's argument that the jury did not necessarily decide the defendant did not possess a firearm when the jury acquitted the defendant of aggravated assault, the supreme court explained:
The state contends that collateral estoppel should not act as a bar to further prosecution because simple possession of a gun was not at issue in the first trial and because the jury may have returned verdicts on the lesser charges out of compassion, compromise, or exercise of their pardon power. It is true that on its face the jury's verdict did not specifically decide whether Gragg had possessed a gun. However, the United States Supreme Court has stated that
the rule of collateral estoppel in criminal cases is not to be applied with the hypertechnical and archaic approach of a 19th century pleading book, but with realism and rationality. Where a previous judgment of acquittal was based upon a general verdict, as is usually the case, this approach requires a court to "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."
Ashe v. Swenson, 397 U.S. 436, 444, 90 S. Ct. 1189, 1194, 25 L. Ed. 2d 469 (1970) (footnote omitted) (quoting Mayers & Yarbrough, Bis Vexari: New Trials and Successive Prosecutions, 74 Harv.L.Rev. 1, 38-39 (1960)).
Having examined the record of the prior proceedings, including the testimony of the police officers and defendant, the instructions, as well as the information which charged defendant with aggravated assault "by pointing a handgun," we are compelled to conclude that the jury necessarily determined that defendant did not possess a firearm. We can find no other basis on which a jury could have rationally based its verdict acquitting defendant of aggravated assault by pointing a handgun as well as all the lesser included offenses.
Accordingly we reverse the trial court's order denying defendant's motion to dismiss the charge of possession of a firearm by a convicted felon and remand with instructions to set aside the conviction.
REVERSED AND REMANDED.
DELL, C.J., and WARNER, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3755437/ | DECISION
{¶ 1} This cause came on to be considered upon a notice of appeal, the transcript of the docket and journal entries, the transcript of proceedings and original papers from the Clermont County Court of Common Pleas, a brief filed by appellant's counsel and the pro se brief of appellant, oral argument having been waived.
{¶ 2} Counsel for defendant-appellant, Gregory G. Scott, has filed a brief with this court pursuant to Anders v. California
(1967), 386 U.S. 738, 87 S.Ct. 1396, which (1) indicates that a careful review of the record from the proceedings below fails to disclose any errors by the trial court prejudicial to the rights of appellant upon which an assignment of error may be predicated; (2) lists two potential errors "that might arguably support the appeal," Anders at 744, 87 S.Ct. at 1400; (3) requests that this court review the record independently to determine whether the proceedings are free from prejudicial error and without infringement of appellant's constitutional rights; (4) requests permission to withdraw as counsel for appellant on the basis that the appeal is wholly frivolous; and (5) certifies that a copy of both the brief and motion to withdraw have been served upon appellant.
{¶ 3} Appellant has filed a pro se brief raising an assignment of error pertaining to ineffective assistance of trial counsel. We have accordingly examined the record and find no error prejudicial to appellant's rights in the proceedings in the trial court. Although appellant argues his trial counsel was ineffective for failing to provide available defenses to the charges, the transcript reveals that appellant indicated at the plea hearing that he was satisfied with the advice of his counsel. Therefore, the motion of counsel for appellant requesting to withdraw as counsel is granted, and this appeal is dismissed for the reason that it is wholly frivolous.
Powell, P.J., Walsh and Valen, JJ., concur. | 01-03-2023 | 07-06-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1603758/ | 882 F. Supp. 177 (1995)
Bernard C. WELCH, Plaintiff,
v.
Sharon Pratt KELLY, et al., Defendants.
Civ. A. No. 94-2298 (JR).
United States District Court, District of Columbia.
March 13, 1995.
Bernard C. Welch, Marion, IL, plaintiff pro se and Ann C. Wilcox, Washington, DC, for plaintiff Welch.
Jacques P. Lerner, Office of Corp. Counsel, Washington, DC, for defendant.
*178 ORDER
ROBERTSON, District Judge.
At the time he filed his "civil rights complaint" in this Court on October 25, 1994, plaintiff Welch was incarcerated at the United States Penitentiary in Marion, Illinois, serving a sentence imposed upon him by the Superior Court of the District of Columbia in 1981 for first degree murder. In his pleadings, filed pro se, Welch attempts to state claims against former Mayor Sharon Pratt Kelly, present Mayor Marion Barry,[1] and six current, former or retired officials of the D.C. Department of Corrections. His lengthy complaint recites the history of his incarceration since May 1981, when he was transferred by the D.C. Department of Corrections to the custody of the U.S. Bureau of Prisons, and of his efforts since the summer of 1992 to be returned to the custody of the D.C. Department of Corrections. The government moves to dismiss.
Welch's first claim[2] invokes 42 U.S.C. § 1983 and asserts that his removal on May 22, 1981 from the D.C. Department of Corrections and transfer to the U.S. Bureau of Prisons without a hearing unconstitutionally interfered with liberty interests conferred upon him by D.C. Department of Corrections Order No. 4810.1A(6)(b) without due process of law.
Welch's second claim is of racial discrimination and recites his belief based on prison rumors and conversations and correspondence with others that the D.C. Department of Corrections intended to return all prisoners incarcerated in the federal system to the District of Columbia by October 1992, but that, in fact, white prisoners were not transferred. He appears to assert further that the explanation for his non-transfer offered by the D.C. Department of Corrections namely, that he was a "protection case" whose "special needs" prevented transfer to the District of Columbia because of the D.C. Department of Corrections' "inability to meet his special needs" was a sham.
Welch's third cause of action asserts violations of the Eighth Amendment in connection with the conditions of his confinement at USP Marion and makes detailed allegations of threats on his life, harassment in the cellblock, and assaults by inmates in the cellblock and the recreation yards, combined with alleged indifference or refusals to investigate on the part of prison officials.[3]
Plaintiff's complaint was originally referred to a Magistrate Judge of this Court. On October 27, 1994, the Magistrate Judge ordered the appointment of pro bono counsel from the panel established by Local Rule 702.1. No such appointment has been made, and the court now withdraws the appointment order. The merits of the claims Welch presents, the complexity of the legal and factual issues involved here, and the degree to which the interests of justice would be served by appointment of counsel for Welch do not present such exceptional circumstances that denial of counsel would result in fundamental unfairness. See, e.g., Cookish v. Cunningham, 787 F.2d 1, 2-3 (1st Cir.1986) (and cases cited therein); Martorano v. FBI, 1991 WL 212521, 1991 U.S.Dist. LEXIS 13680 (D.D.C. September 30, 1991). Locating a volunteer attorney to undertake representation of an inmate of USP Marion would tax the already scarce volunteer resources available to this Court in handling pro se cases.
The motion to dismiss of defendants Kelly, Walter Ridley and Margaret *179 Moore[4] recites the well-established law that a prisoner has no constitutional right to be housed in any particular prison and that the constitutional guarantees of due process themselves create no liberty interest in a prisoner remaining in the general prison population. Hewitt v. Helms, 459 U.S. 460, 466-68, 103 S. Ct. 864, 868-70, 74 L. Ed. 2d 675 (1983). Defendants also correctly rely upon D.C.Code § 24-425 for the proposition that the Attorney General, to whose custody District of Columbia prisoners are committed by statute, is authorized to order the transfer of any prisoner from one institution to another "if, in [her] judgment, it shall be for the well-being of the prison or relieves overcrowding or unhealthful conditions in the institution where such prisoner is confined, or for other reasons."
Defendants do not, however, address Welch's more specific claim that the "liberty interest" necessary to make his claim a constitutional one is established by D.C. Corrections Department Order No. 4810.1A(6)(b), or by the settlement of the class action case he cites in his complaint, or both. The factual context of this claim needs to be set forth in some detail:
D.C. Department of Corrections Departmental Order (DO) 4810.1A establishes procedures for the transfer of sentenced offenders between institutions of the Department of Justice and Bureau of Prisons and the District of Columbia Department of Corrections. It was first issued on May 2, 1980, superseding an earlier Department order on the same subject. As amended on May 22, 1981, when Welch's sentence was imposed, the administrative procedures required by DO 4810.1A included the following:
Upon receipt of notification that a DCDC resident is to be transferred to a BOP institution it shall be the responsibility of the institution Administrator to ensure that the resident is afforded a hearing before a committee consisting of at least three institutional staff members and advised of the reason(s) for the transfer. During the hearing the resident shall be afforded the opportunity to indicate any objections, and rationale for the same, regarding the transfer.
D.C. Department of Corrections Departmental Order 4810.1A(6)(b) (1981).
Welch asserts that he never had a hearing. That assertion is accepted as true for purposes of this motion. Three months after Welch was sentenced and transferred to the federal prison system, the Department of Corrections amended ¶ 6(b), deleting the requirement of a hearing.
Nevertheless, while the hearing requirement of DO 4810.1A was in force, it became the subject of a class action commenced in the Superior Court of the District of Columbia only days after Welch was sentenced. The plaintiff class consisted of
all inmates sentenced pursuant to the laws of the District of Columbia who were incarcerated in the District of Columbia Department of Corrections and who allege that they have been summarily and involuntarily transferred after April 30, 1976 and before August 17, 1981 from the D.C. Department of Corrections to institutions and facilities of the Federal Bureau of Prisons without a hearing as described in DCDC Department Order Number 4810.1(6)(b).
Robertson v. Holland, No. 9502-78 (D.C.Super.Ct. filed Sept. 3, 1982).
The class action was settled in September 1982. The settlement provided for the return of twenty named individuals to facilities operated by the D.C. Department of Corrections.[5] Contrary to Welch's apparent understanding, the settlement order did not require that he be returned to facilities operated by the D.C. Department of Corrections, nor did it require that he be afforded a due process hearing. The twenty individuals named in the settlement were selected "upon *180 consideration of the underlying reasons for their transfers to Federal Bureau of Prisons facilities as perceived from plaintiffs' counsel's review of the transfer records." Welch was not one of them.
In any event, Welch's attempt in 1994 to enforce an administrative right that he had only for a few months in 1981 comes far too late. It is settled that federal courts turn to state law for statutes of limitations in actions, like this one, brought under the Reconstruction Era Civil Rights Acts, 42 U.S.C. § 1981 et seq. The District of Columbia law of limitations governing a cause of action analogous to Welch's complaint is D.C.Code Ann. § 12-301(8). Banks v. Chesapeake & Potomac Telephone Co., 802 F.2d 1416, 1421 (D.C.Cir.1986); see Chardon v. Fumero Soto, 462 U.S. 650, 655-56, 103 S. Ct. 2611, 2615-16, 77 L. Ed. 2d 74 (1983); Board of Regents v. Tomanio, 446 U.S. 478, 483-84, 100 S. Ct. 1790, 1794-95, 64 L. Ed. 2d 440 (1980). Welch's cause of action to enforce his right to a hearing accrued, at the latest, sometime in September 1982, when he is deemed to have received notice of the settlement of the class action.[6] It expired, at the latest, in September 1985.
Welch's invocation of DO 4810.1A and his attempt to avail himself of the class settlement in the Robertson case are thus ineffective. Without those distinguishing characteristics, this case is governed by settled law. An inmate "has no justifiable expectation that he will be incarcerated in any particular prison within a state [or] ... in any particular state." Olim v. Wakinekona, 461 U.S. 238, 245, 103 S. Ct. 1741, 1745, 75 L. Ed. 2d 813 (1983); Curry-Bey v. Jackson, 422 F. Supp. 926, 931-33 (D.D.C.1976). Plaintiff's claim of due process violations fails to state a claim against defendants Kelly, Ridley or Moore upon which relief can be granted and will be dismissed. Defendants' motion will also be granted as to defendants Patricia Britton and Walter Hill, who filed joinders.
Welch's second cause of action, complaining of racial discrimination in the alleged refusal of Bureau of Prisons officials to transfer him back to the District of Columbia, was brought against the wrong defendants. Since his incarceration in 1981, Welch has not been in the custody of the District of Columbia Department of Corrections, but rather in the custody of the Attorney General of the United States. D.C.Code Ann. § 24-425; 18 U.S.C. § 4082(b). Defendants have retained no authority over the plaintiff, cf. Milhouse v. Levi, 548 F.2d 357, 365 (D.C.Cir. 1976), and plaintiff's claims of discrimination do not lie against them.
In his third cause of action, Welch complains of certain circumstances of his confinement at U.S.P. Marion. The witnesses and files necessary to prosecute those claims are located in Illinois. The burden of transporting the prisoner to the District of Columbia would be significant. For these reasons, and in the absence of any countervailing interests, those claims will be transferred to the Northern District of Illinois. 28 U.S.C. § 1404(a); Starnes v. McGuire, 512 F.2d 918 (D.C.Cir.1974).
Welch has sought an order requiring that he be provided with the home addresses of three retired District of Columbia corrections officials so that they may be served with his complaint. Release of their home addresses would serve no purpose and would cause an unnecessary intrusion into their private lives. The motion will be denied.
For all the reasons stated above, and upon the court's review of the entire record, it is this 10th day of March 1995
ORDERED that the order appointing counsel from the pro se panel to represent plaintiff [# 3] is vacated; and it is further
ORDERED that the claims set forth in ¶¶ 42, 43, and 47 of the complaint are dismissed *181 for failure to state a claim upon which relief may be granted; and it is further
ORDERED that the claims set forth in ¶¶ 44, 45, and 46 of the complaint be transferred to the Northern District of Illinois.
NOTES
[1] Mayor Barry is sued in his capacity as Washington's mayor in 1981, when Welch was convicted and incarcerated.
[2] Welch's complaint sets forth factual allegations at ¶¶ 14-41 and "claims" at ¶¶ 42-47. The court has given his complaint the required liberal construction, see Cruz v. Beto, 405 U.S. 319, 92 S. Ct. 1079, 31 L. Ed. 2d 263 (1972); Haines v. Kerner, 404 U.S. 519, 92 S. Ct. 594, 30 L. Ed. 2d 652 (1972), and has parsed it into three claims.
[3] Welch's pleading also asserts denial of access to his attorneys, but, even construing the complaint liberally, see Cruz v. Beto, supra 405 U.S. at 319, 92 S.Ct. at 1079; Haines v. Kerner, supra 404 U.S. at 519, 92 S.Ct. at 594, this does not appear to be a claim separate from his claims relating to his non-transfer back to the District of Columbia.
[4] At the time, defendants Ridley and Moore were, respectively, the former Director and the Director of the Department of Corrections.
[5] Welch provided the court with what appear to be authentic copies of a Notification of Class Members and Order, both dated September 3, 1982 and bearing the signature of Judge Sylvia Bacon. The file of this case is no longer at Superior Court.
[6] Notice of the settlement was required by the Superior Court's order to be given by "posting general notice in all Federal Bureau of Prisons facilities wherein members of the plaintiff class may reside." Welch will not be heard now, a dozen years later, to complain that he did not have notice of the class action or of its settlement. Peters v. National R.R. Corp., 966 F.2d 1483 (D.C.Cir.1982). He is bound by Judge Bacon's order although the order neither helps nor hinders his effort to be transferred. The order expressly left class members free to pursue administrative remedies provided by Bureau of Prisons regulations. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603828/ | 645 So. 2d 7 (1994)
SARASOTA COUNTY, a political subdivision of the State of Florida, Appellant,
v.
Gene EX and Elaine Ex, his wife, Appellees.
No. 93-01639.
District Court of Appeal of Florida, Second District.
August 3, 1994.
Richard E. Nelson of Nelson Hesse Cyril Smith Widman Herb Causey & Dooley, Sarasota, and Jorge L. Fernandez, County Atty., and H. Ray Allen, III, and Alan W. Roddy, Asst. County Attys., Sarasota, for appellant.
S. William Moore and Alan E. DeSerio of Brigham, Moore, Gaylor, Ulmer & Schuster, Tampa, for appellees.
ALTENBERND, Judge.
Sarasota County appeals a final judgment in an action filed by Gene and Elaine Ex in September 1991. The Exes sought monetary compensation for land they had deeded to the county in August 1983. We conclude the statute of limitations for this action expired before it was filed. Although the Exes describe their action as a claim for inverse condemnation arising out of the county's unconstitutional demand for a dedication of their land, they are actually seeking additional consideration for a valid deed they granted to the county more than eight years ago.
I. A WORD ABOUT MOTIONS
Before reaching the merits of this case, we comment upon a problem that frequently occurs in appellate motion practice. This case is merely a good example of the problem. There is a tendency for motions to proliferate because lawyers simply will not permit an adversary to have the last word.
During 1993, this court received approximately 8500 motions, excluding motions for rehearing and rehearing en banc. Many, if not most, of those motions were filed in good faith and in an effort to facilitate the timely resolution of the relevant appeal. We do, however, receive unnecessary or inappropriate motions in many cases. Occasionally, we deny such a motion with a citation to Dubowitz v. Century Village East, 381 So. 2d 252, 253 (Fla. 4th DCA 1979), as a reminder that this court, as well as the Fourth District, suffers from "acute motion sickness."
This case involves a more severe problem. It demonstrates the all-too-common process by which one questionable filing results in a volley of unnecessary motions, responses, replies, answers, etc. Lawyers need to realize *8 that appellate motion practice is not a game of ping-pong in which the last lawyer to serve wins.
During oral argument, the Exes' attorney received numerous questions from the court. The attorney was legitimately concerned that the issues might not be briefed as thoroughly as the court desired. Accordingly, he filed two notices of supplemental authority a few days after the oral argument. The notices did not further argue the case, but cited a few cases and identified the issues discussed in those cases. Although it would have been better if these cases had been cited prior to oral argument, the notices were clearly filed in good faith and were not abusive under Florida Rule of Appellate Procedure 9.210(g). Cf. Ogden Allied Servs. v. Panesso, 619 So. 2d 1023 (Fla. 1st DCA 1993) (notice of twenty-two supplemental authorities on afternoon before oral argument is abuse of rule).
These notices generated the following filings:
1. The county's motion to strike appellees' two notices of supplemental authority.
2. The Exes' reply to motion to strike appellees' two notices of supplemental authority.
3. The county's motion to strike reply to appellees' notices of supplemental authority.
4. The Exes' response to motion to strike reply to appellees' notices of supplemental authority.
None of these filings was necessary or helpful to this court. Rather than facilitate this court's operation, they slowed the operation and caused needless administrative labor. These motions undoubtedly have cost clients and taxpayers unnecessary dollars.
We do not assess fault for these filings on one party or the other, and we impose no sanction. We simply remind attorneys, that, as officers of the court, they must exercise restraint when filing motions. In most cases, motions to strike motions and other similar pleadings are simply unauthorized responses that demonstrate an attorney's lack of self-discipline.
II. STATUTE OF LIMITATIONS CONCERNING A CLAIM FOR ADDITIONAL COMPENSATION ON A VALID DEED
In 1983, the Exes owned four acres of property on the south side of DeSoto Road in Sarasota County on which they sought to develop thirty-six condominium units. During the permitting process, the county informed them that the permits would not be issued unless the Exes deeded to the county a ten-foot strip of land along the right-of-way for DeSoto Road. The testimony at trial established that the Exes verbally protested this requirement, but decided they must grant the deed to avoid a delay in their development.
On August 11, 1983, Mr. Ex sent a handwritten letter to the county enclosing a deed to the ten-foot strip of land. The letter states:
Dear Sir:
Enclosed is a deed giving ten feet along DeSoto Road to Sarasota County for future road widening the length of my property.
Please advise the value you would place on this donated property, and any forms necessary to be submitted to Internal Revenue Service for my future tax considerations.
Thank you for your cooperation.
Sincerely,
/s/
Gene Ex
The deed reflects consideration of "one dollar and other valuable considerations paid." It is undisputed that the county recorded the deed and sent the Exes the following reply:
Dear Mr. and Mrs. Ex:
Sarasota County appreciates you contributing the additional road right of way for Desoto [sic] Road, per OR 1612/19-20.
This contribution of 6183 sq. ft. of road frontage has a value of $23,800.00.
Sincerely,
/s/
Jack Clark
Real Property Office
*9 Following these transactions, the county issued the necessary permits and DeSoto Company, a corporation in which the Exes were principal shareholders, began construction. The Exes filed tax returns receiving limited tax savings for this $23,800 "donation" of land. Thereafter, problems developed and the project lender foreclosed on the remaining property. The Exes lost any legal interest in the development through a judicial sale on December 29, 1987.
The Exes filed this action on September 6, 1991. Their complaint maintained that the county ordinances in 1983 did not validly require them to dedicate this property and that the county's action in requiring a deed in exchange for a building permit constituted inverse condemnation. Among several defenses, the county raised the statute of limitations and waiver or estoppel.
After an evidentiary hearing, the trial court rejected all of the defenses and specifically found that the Exes' dedication and deed were "involuntary." It entered a judgment in favor of the Exes for $23,800, plus 12% interest from August 11, 1983, and reserved jurisdiction to award attorneys' fees. The county then filed this timely appeal.
The issues in this appeal are difficult to articulate because of the unusual facts involved. Both parties have argued rather broad issues concerning the applicable statute of limitations and the nature of estoppel in a typical inverse condemnation case. The county primarily argues that this action should be controlled by a four-year statute of limitations under section 95.11(3), Florida Statutes (1991). The Exes contend that in a typical inverse condemnation action, a government agency is similar to an adverse possessor, and that the majority of jurisdictions apply a longer statute of limitations for adverse possession, in the absence of a specific statute for inverse condemnation. See White Pine Lumber Co. v. City of Reno, 106 Nev. 778, 801 P.2d 1370 (1990); Charles C. Marvel, Annotation, State Statutes of Limitations Applicable to Inverse Condemnation or Similar Proceedings By Landowner to Obtain Compensation for Direct Appropriation of Land Without the Institution or Conclusion of Formal Proceedings Against Specific Owner, 26 A.L.R. 4th 68 (1983).
In a typical condemnation case, the county files an action to obtain title to property for a public use. § 73.021, Fla. Stat. (1993). In exchange for a judgment transferring title, the county must pay just compensation. § 73.101, Fla. Stat. (1993). In a typical inverse condemnation action, the landowner files an action alleging that it holds title to the property and that the county has committed acts that substantially interfere with the owner's property rights. In that action, the landowner seeks to compel the county either to take full title to the property and pay just compensation, or to purchase a limited interest in the property. See Florida Eminent Domain Practice and Procedure, Inverse Condemnation § 13.5 (4th ed. 1988).
In this case, the Exes formally transferred title to the county in 1983. The deed may not have been cheerfully given and the act may have been "involuntary" for some purposes, but the deed was not a void instrument. As of August 11, 1983, the county owned this real property, and the Exes no longer possessed a legal interest in it. The Exes have not alleged that the deed was voidable because of duress, incompetency, fraud, or any other reason. See generally 19 Fla.Jur.2d Deeds §§ 83-100 (1980). Moreover, this record would not support such theories.
Thus, the narrow issue actually presented by the Exes' action is whether a former landowner may seek additional consideration from a county for land validly deeded to the county more than eight years ago. We conclude that such an action is not governed by the statute of limitations for adverse possession.[1]
The reason that many courts have applied the statute of limitations for adverse possession to an action for inverse condemnation is that
the owner's right of recovery is founded upon and grows out of his title to land and that until such title is lost by adverse possession the owner should have the right to maintain an action to recover that which represents the property itself.
*10 Frustuck v. City of Fairfax, 212 Cal. App. 2d 345, 374, 28 Cal. Rptr. 357, 374-75 (1963), cited in White Pine Lumber Co., 801 P.2d at 1371. The close analogy between inverse condemnation and adverse possession disappears when the landowner has already transferred title to the property by a valid deed to the governmental agency. Therefore, the statute of limitations for an adverse possession action does not apply to the Exes' action for additional consideration from the county for property they deeded to it more than eight years ago. See also Hart v. City of Detroit, 416 Mich. 488, 331 N.W.2d 438 (1982) (adverse possession statute of limitations did not apply where plaintiffs lost all interest and title to property for nonpayment of taxes).
We do not need to decide whether this action is governed by a four-year limitations period under section 95.11(3), as urged by the county. The longest possible statute of limitations for this case is seven years from the date the Exes last possessed this property. § 95.14, Fla. Stat. (1991). This statute, which governs actions founded on title to real property, or to rents or service from it, would bar the Exes' action, filed more than eight years after they transferred title to the county.
Reversed and remanded.
CAMPBELL, A.C.J., and FULMER, J., concur.
NOTES
[1] Whether a typical inverse condemnation action is controlled by the statute of limitations for adverse possession is not an issue that we are required to resolve. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603871/ | 8 So. 3d 1260 (2009)
PEPSI BOTTLING GROUP, INC., and Sedgwick Claims Management Services, Inc., Petitioners,
v.
Wanzell J. UNDERWOOD, Respondent.
No. 1D08-6216.
District Court of Appeal of Florida, First District.
May 7, 2009.
*1261 Richard Heinzman and Timothy A. Dunbrack of Kelley, Kronenberg, Gilmartin, Fichtel & Wander, Orlando, for Petitioners.
No appearance for Respondent.
PER CURIAM.
Petitioners seek a writ of certiorari quashing the Judge of Compensation Claims' (JCC) order requiring them to schedule a medical evaluation to establish a maximum medical improvement (MMI) date, and permanent impairment rating (PIR). The purpose of determining this information was to establish the amount of income impairment benefits (IIBs) to which Respondent would be entitled for purposes of offsetting this amount against overpaid temporary total disability (TTD) benefits. Petitioners assert this order departs from the essential requirements of law, and complying with it would cause irreparable harm that cannot be remedied on appeal. We disagree, and deny the petition.
Factual Background
Respondent (who was unrepresented during the entire course of the proceedings below) suffered a compensable accident, underwent back surgery, and was paid TTD benefits. For reasons apparently unrelated to the accident, Respondent left his employ with Petitioners to work for a different employer. He began earning a salary from the new employer on July 5, 2005. For reasons not clear from the record, Petitioners continued to pay Respondent TTD benefits through January 29, 2006. Respondent was working this entire time. After learning of their error, Petitioners filed a motion for repayment of all TTD benefits paid during this period pursuant to section 440.15(12), Florida Statutes (2004). At a hearing on the motion, Petitioners also asserted the statute of limitations (SOL) had run on the claim.
The JCC granted the motion, but in so doing found Respondent had not yet been assigned an MMI date and PIR. The JCC found Respondent "would most likely be entitled to a physician-assessed [PIR]," and in such event, Respondent "would be entitled" to IIBs. Consequently, the JCC ordered Petitioners to schedule an evaluation for Respondent with the surgeon who operated on his back to determine the MMI date and PIR. The JCC decided that any IIBs Respondent would have been entitled to based on the PIR could be used as a credit against the overpayment of TTD benefits. The JCC reasoned this credit would simply reclassify as IIBs all or part of the TTD benefits already paid. In a motion for rehearing, Petitioners argued the JCC was not only awarding benefits Respondent was not seeking, and could not seek because the SOL had expired, but that complying with the order would result in a revival of the otherwise expired claim. This abrogation of their SOL defense, Petitioners *1262 argued, would cause irreparable harm that cannot be remedied on appeal.
Analysis
For a nonfinal workers' compensation order to be reviewable by certiorari, a petitioner is required to demonstrate that the order constitutes departure from the essential requirements of law, and would cause material harm that cannot be adequately remedied by appeal. See, e.g., Diestel v. Winfrey Plumbing, Inc., 668 So. 2d 283, 284 (Fla. 1st DCA 1996). Irreparable harm is a condition precedent to invoking certiorari jurisdiction, that should be considered first. See Spry v. Prof'l Employer Plans, 985 So. 2d 1187, 1188 (Fla. 1st DCA 2008).
Here, the JCC ordered Petitioners to schedule an evaluation for Respondent with his former surgeon for the purpose of determining his MMI date and PIR. This court has held that, at least for SOL purposes, the distinction between an "examination" and "treatment" should not be artificially and unrealistically made. See Barnett v. EMR Telemetry, 396 So. 2d 791, 792 (Fla. 1st DCA 1981). To distinguish a "mere" examination from treatment, it is essential to examine not only the actual functions performed by the physician, but also the purpose of the physician's examination. Id. If the purpose of the examination is solely for evaluation, with no treatment contemplated or authorized, the evaluation does not constitute remedial care for SOL purposes. Id. Consequently, Petitioners' provision of the evaluation ordered by the JCC would not revive this claim, if in fact the SOL has expired.
Whether the evaluation ordered by the JCC will result in a credit against overpaid TTD benefits is speculative because no PIR has been determined. Even if such a credit were assessed, it would simply be a reclassification of benefits Petitioners have already paid, not a payment of additional benefits. This calculation of the amount overpaid would itself be based on a medical evaluation that would not, on its own, revive a claim in which the SOL has expired. If a credit is assessed, Petitioners can challenge the order on appeal. Because any harm the JCC's order may cause Petitioners can be remedied on appeal, Petitioners have failed to satisfy the irreparable harm requirement for establishing entitlement to a writ of certiorari. Accordingly, we need not consider whether the order departs from the essential requirements of the law. See Spry, 985 So.2d at 1188.
Conclusion
Because the JCC's order would not result in irreparable harm that cannot be remedied on appeal, Petitioners' petition for writ of certiorari is DENIED.
WOLF, KAHN, and VAN NORTWICK, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604068/ | 882 F. Supp. 356 (1995)
Carol ELDRIDGE and American Textile Company, Plaintiffs,
v.
SPRINGS INDUSTRIES, INC., Robert Lorberbau, Lori Sanford, and Edward Kaplan, Defendants.
No. 89 Civ. 5882 (DNE).
United States District Court, S.D. New York.
April 27, 1995.
*357 George E. Kersey, New York City, for American Textile Co., Carol Eldridge.
Michael F. Close, Barry, McTiernan & Moore, New York City, for Robert Lorberbaum, Lori Sanford, Springs Industries, Inc.
MEMORANDUM & ORDER
EDELSTEIN, District Judge:
Plaintiffs brought this action, alleging copyright infringement, trade-dress infringement, product misappropriation, trade-name misappropriation, misappropriation of proprietary information, conspiracy to defraud, product interference, and design-patent infringement, in connection with plaintiffs' design for a children's bed rest called a "Snug-up." Defendants' motion to dismiss the complaint or, in the alternative, for summary judgment, was denied, and the parties subsequently completed discovery and submitted a joint pretrial order. Currently before this Court is defendants' motion, brought pursuant to Federal Rule of Civil Procedure ("Rule") 12(b)(1), to dismiss Count VIII of the complaint the design-patent infringement claim for lack of subject-matter jurisdiction. Defendants have also moved, pursuant to Rule 16, for leave to amend the joint pretrial order. For the reasons discussed below, both of defendants' motions are granted.
I. Motion to Dismiss
Defendants aver that, during discovery, they learned that the design patent referred to in Count VIII of the complaint was issued four months after the filing of the complaint. As a result of this discovery, defendants brought the instant motion to dismiss Count VIII.
As a threshold matter, defendants have incorrectly labelled their motion to dismiss as a Rule 12(b) motion. Rule 12(b) provides that "[a] motion making any of these defenses shall be made before pleading if a further pleading is permitted." Because defendants have filed an answer, they cannot now bring a motion pursuant to Rule 12(b). Defendants' motion may, however, properly be brought as a motion for judgment on the pleadings, pursuant to Rule 12(c). See 2A James W. Moore et al., Moore's Federal Practice ¶ 12.15 (2d ed. 1995). Rule 12(c) states, in relevant part: "After the pleadings are closed but within such time as not to delay the trial, any party may move for judgment on the pleadings." Accordingly, this Court will construe the instant motion as a Rule 12(c) motion. See 2A James W. Moore et al., Moore's Federal Practice ¶ 12.15 (2d ed. 1995) ("a motion to dismiss after the pleadings have been closed may be treated as a motion for a judgment on the pleadings").
Rule 12(c) states further, however, that "[i]f, on a motion for judgment on the pleadings, matters outside the pleadings are presented to and not excluded by the court, the motion shall be treated as one for summary judgement and disposed of as provided in Rule 56...." In the instant case, the gravamen of defendants' motion is that plaintiffs' design patent was issued four months after plaintiffs filed their complaint, and thus, defendants present this Court with matters outside the pleadings. Because defendants' motion is premised on facts not presented in the pleadings, the Court will treat the instant motion as a Rule 56 motion for summary judgment.
Count VIII of the complaint alleges design-patent infringement, and this count is based on a patent that plaintiffs concede was issued four months after plaintiffs filed their complaint. It is well settled that a patent cannot be infringed until after that patent has been issued. See Gilbert v. General Motors Corp., 32 F. Supp. 502, 504 (S.D.N.Y. 1940); Mike Levine, Inc. v. Baer, 32 F. Supp. 575, 575 (S.D.N.Y.1939). Moreover, a plaintiff cannot bring a claim for design-patent infringement before such infringement occurs. Plaintiffs concede that "[t]he design patent was not identified in the complaint because it had not yet issued." (Memorandum in Opposition to Defendants' Motion To Dismiss Count VIII and in Support of Plaintiff's Motion for Any Necessary Amendment to the Complaint at 1.)
Plaintiffs raise four arguments in opposition to defendants' motion. First, plaintiffs *358 argue that "Count VIII sets forth plaintiffs' guarantee that an application has been filed and further than an embodiment has been approved by the Examiner so that the patent will issue in due course." (Id. at 3.) Plaintiffs' "guarantee," however, is obviously not a patent and does not suffice to support a claim for design-patent infringement.
Second, plaintiffs argue that "until the design patent issued ..., the gravamen of Count VIII was for Common Law infringement by unauthorized copying. The plaintiffs' Federal rights did not accrue until the patent issued.... Once the patent issued, there was incipient Federal jurisdiction which matured in actual jurisdiction by the actions of the defendants." (Id. at 2.) This argument is utterly lacking in merit. Count VIII states a claim for "design patent infringement," and contains no mention of common-law claims. Moreover, plaintiffs concede that their "rights did not accrue" until after the filing of the complaint. The argument that federal jurisdiction "matured" at some point after the complaint was filed is unsupported and without any basis in law.
Third, plaintiffs' argue that defendants waived any right to bring this motion because defendants allegedly failed to bring this motion in a timely fashion. This argument is flatly contradicted by Rule 12(c), which states that a motion for judgment on the pleadings may be brought "[a]fter the pleadings are closed but within such time as not to delay the trial ..."
Finally, plaintiffs argue that "[t]o the extent that there is any defect in the pleadings, they can be cured by an appropriate amendment to the Complaint." (Id. at 6.) This argument is irrelevant. Plaintiffs titled their memorandum of law in response to defendants' motion "A Memorandum in Opposition to Defendants' Motion to Dismiss Count VIII and in Support of Plaintiffs' Motion for Any Necessary Amendment to the Complaint." Notwithstanding their memorandum's title, however, plaintiffs have not filed a motion for leave to serve a supplemental pleading. Plaintiffs have filed no notice of motion, and plaintiffs' memorandum does not even ask this Court for leave to serve a supplemental pleading. In sum, although plaintiffs claim that they could cure the defects in the complaint, they have failed to file a motion to do so. Thus, plaintiffs' argument is without merit.
Accordingly, Count VIII of the complaint is dismissed.
II. Motion for Leave to Amend the Joint Pretrial Order
Defendants also move, pursuant to Rule 16(e), for leave to amend the joint pretrial order. First, defendants seek to amend the order to include one additional witness the wife of a witness identified in the original pretrial order who will testify concerning the independent creation of the designs used by defendants. Second, defendants seek to replace several documents listed in the original joint pretrial order with others that defendants believe will more effectively demonstrate both the lack of novelty of plaintiffs' product and the independent creation of defendants' product. Plaintiffs have not submitted any papers in response to defendants' motion.
Rule 16(e) states, in relevant part: "The order following a final pretrial conference shall be modified only to prevent manifest injustice." The Second Circuit has adopted a flexible interpretation of Rule 16(e), stating that "permission to amend a pretrial order is to be granted when `the interests of justice make such a course desirable.'" Madison Consultants v. Federal Deposit Ins. Corp., 710 F.2d 57, 62 n. 3 (2d Cir.1983); see also Laguna v. American Export Isbrandtsen Lines, Inc., 439 F.2d 97, 101-02 (2d Cir.1971) ("we have not viewed ... modification [of pretrial orders] with hostility").
In the instant case, defendants' proposed amendments are modest, contain no new claims, and serve merely to streamline and clarify defendants' presentation of their defense. Preventing defendants from amending the joint pretrial order may hamper the efficient trial of this case, and plaintiffs have failed to argue that they would be prejudiced by the proposed amendments. Indeed, plaintiffs have failed to file any papers in response to this motion; under Local Civil Rule 3(b), the failure to file response papers *359 "may be deemed sufficient cause for ... the granting of the motion by default."
Accordingly, defendants' motion for leave to amend the joint pretrial order is granted.
SO ORDERED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3038084/ | United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 04-3284
___________
United States of America, *
*
Appellee, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota.
Tong Xiong, also known as Johnny, *
* [UNPUBLISHED]
Appellant. *
___________
Submitted: June 20, 2005
Filed: July 8, 2005
___________
Before LOKEN, Chief Judge, and MORRIS SHEPPARD ARNOLD and
COLLOTON, Circuit Judges.
___________
PER CURIAM.
Tong Xiong appeals from his sentence of 97 months for the sexual trafficking
of a minor, see 18 U.S.C. § 1591. He argues that the district court1 violated his sixth
amendment rights in sentencing him. We disagree and affirm.
The district court sentenced Mr. Xiong on the basis of facts that were contained
in his presentence investigation report and to which Mr. Xiong made no objection.
1
The Honorable Joan N. Ericksen, United States District Judge for the District
of Minnesota.
Since Mr. Xiong is therefore taken to have admitted these facts, the district court
committed no sixth amendment error in arriving at the guideline range applicable to
Mr. Xiong's case. See United States v. Booker, 125 S. Ct. 738, 755-56 (2005); United
States v. McCully, 407 F.3d 931, 933 (8th Cir. 2005).
While the district court erred by sentencing Mr. Xiong on the assumption that
the sentencing guidelines were mandatory, because this issue was not raised in the
district court we review for plain error only. See United States v. Pirani, 406 F.3d
543, 548-50 (8th Cir. 2005) (en banc). Our examination of the record does not lead
us to conclude that there is reasonable probability that the district court would have
given Mr. Xiong a shorter sentence had it been aware that the guidelines were
advisory. Mr. Xiong therefore has not established that the error affected his
substantial rights, one of the prerequisites for plain-error relief. See id. at 550-51.
Affirmed.
______________________________
-2- | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1603730/ | 645 So.2d 1269 (1994)
Emile KOEPP
v.
SEA-LAND SERVICE, INC.
No. 93-CA-2562.
Court of Appeal of Louisiana, Fourth Circuit.
November 17, 1994.
*1271 Mary Ann Hand, Salvador E. Gutierrez, Jr., Gutierrez and Hand, Chalmette, for plaintiff/appellee.
*1272 Gerard T. Gelpi, J. Timothy Woodard, Gelpi, Sullivan, Carroll & Gibbens, New Orleans, Sidney D. Torres, III, Michael R. Delesdernier, Chalmette, for defendant/appellant.
Before KLEES, JONES and WALTZER, JJ.
JONES, Judge.
This is a personal injury case arising out of an accident which occurred on October 13, 1990. The plaintiff, Emile Koepp sustained personal injuries while attempting to make repairs to his shrimping boat, the KOOL BREEZE. At the time of the accident, the KOOL BREEZE was moored at a dock owned by Louisiana Power and Light (LP & L) near the intersection of the Gulf Intercoastal Waterway and the Mississippi River Gulf Outlet. The SEALAND CONSUMER, a vessel owned by defendant Sea-Land Service, Inc. and being operated by defendant, Captain Ronald Blancq, entered the outlet and passed the vicinity where the KOOL BREEZE was moored.
The SEALAND CONSUMER caused a suction and subsequent wave wash. The plaintiff, unable to get off the boat timely, attempted to climb the ladder on the KOOL BREEZE to keep from getting squeezed or thrown overboard. However, the force of the wave caused the plaintiff to be thrown through the ladder into the picking box, thereby sustaining serious injury to his back.
The plaintiff instituted this litigation against defendants, Captain Ronald Blancq and Sea-Land Service, Inc. seeking damages for the injuries suffered in the accident. The trial court issued a judgment in favor of the plaintiff. The trial court found that the defendants were negligent in failing to keep a proper lookout, in traveling at an excessive and unsafe rate of speed, and in negligently creating an excessive swell thereby causing the plaintiff's injuries.
The trial court fixed the plaintiff's damages at $553,343.01. The trial court itemized the plaintiff's damages as follows:
PAST LOSS OF EARNINGS AND PAST
LOSS OF EARNING CAPACITY $ 11,758.00
FUTURE LOSS OF EARNING CAPACTY $133,774.00
DAMAGES TO BOAT AND LOSS OF
EQUIPMENT $ 2,000.00
MEDICAL BILLS $ 5,811.01
PAST AND FUTURE PHYSICAL PAIN
AND SUFFERING $150,000.00
PAST AND FUTURE MENTAL PAIN
AND SUFFERING $100,000.00
LOSS OF ENJOYMENT OF LIFE AND
PERMANENT RESIDUAL DISABILITY $150,000.00
Defendants, Captain Ronald Blancq and Sea-Land Service, Inc. appeal the judgment of the trial court ordering them to pay the plaintiff, Emile Koepp, a total of $553,343.01. On appeal, the defendants raise numerous assignments of error.
SEA-LAND SERVICE, INC.'S APPEAL
Sea-Land Service, Inc. argues: 1) the plaintiff failed to establish that the SEALAND CONSUMER was the vessel which caused the accident; alternatively, 2) the evidence establishes that the SEALAND CONSUMER was not traveling at an excessive speed when it passed the dock at the time the plaintiff was injured; 3) the trial court applied the wrong standard of law to find defendant negligent; 4) the trial court erred in finding the plaintiff to be free of any fault for causing his injuries; 5) the trial court erred in accepting the testimony of plaintiff's experts and rejecting the testimony of the defendant's experts; and 6) the trial court erred in awarding excessive and duplicative damages.
CAPTAIN RONALD BLANCQ'S APPEAL
Captain Blancq argues: 1) the trial court erred in failing to require the plaintiff to prove that his damages resulted from defendant, Captain Blancq's gross negligence or willful misconduct as required by La.R.S. 34:1001; 2) the SEALAND CONSUMER was not the vessel which caused the plaintiff's alleged damages; 3) the plaintiff was wholly or partially responsible for his own damages; and 4) the trial court awarded the plaintiff an excessive amount of damages.
Identity of the Vessel causing the Accident
Appellants argue that the trial court erred in finding that the vessel which caused plaintiff's *1273 alleged injuries was the SEALAND CONSUMER.
Appellants argue that the testimony indicates that the SEALAND CONSUMER passed the LP & L dock prior to the time that the incident allegedly occurred, that the description given of the vessel which caused the wave swell did not fit the SEALAND CONSUMER, and that the testimony given by the plaintiff concerning the speed of the offending vessel conflicted with the testimony of another witness concerning the speed the SEALAND CONSUMER was traveling at the time she passed the LP & L dock.
In support of the contention that the SEALAND CONSUMER passed the LP & L dock prior to the accident, appellants argue that the testimony of the plaintiff concerning the time the accident occurred conflicted with the testimony of other witnesses. Since the time given by the plaintiff also conflicted with the time which the SEALAND CONSUMER's logs and the pilot's trip ticket indicate the SEALAND CONSUMER would have passed the site of the accident, appellants argue the SEALAND CONSUMER could not have been the vessel which caused the wave swell. Additionally, appellants rely on the fact that earlier descriptions of the offending vessel and testimony concerning the speed the vessel was traveling support a finding that the offending vessel was not the SEALAND CONSUMER.
The issue of whether the vessel which caused the wave swell was the SEALAND CONSUMER was an issue of fact to be determined by the fact finder. The finding that the vessel causing the wave swell was the SEALAND CONSUMER is supported by the direct testimony from the plaintiff that the name on the vessel passing at the time of the wave swell was "SEALAND CONSUMER". Additionally, Chris Lougriss testified that when he used the radio aboard the KOOL BREEZE to try to ascertain the identity of the passing ship, an unidentified third party on the radio informed him that the ship which had just passed was the SEALAND CONSUMER.
While the defendants were able to introduce logs to pinpoint the time the vessel was in the vicinity, none of the plaintiff's witnesses could pinpoint the exact time of the incident. This was not surprising in light of the fact that trial of this matter occurred almost three years after the accident. However, the testimony that the plaintiff saw the name of the vessel on the ship and that Mr. Lougriss was told the name of the vessel on the radio was uncontroverted. This testimony supports the finding of the trial court that it was in fact the SEALAND CONSUMER that caused the accident. The trial judge evidently gave more credence to the testimony of the plaintiff and Mr. Lougriss than to the testimony and logs submitted by the defendants.
This court cannot set aside a trial court's finding of fact in the absence of manifest error or unless the finding is clearly wrong. Stobart v. State through DOTD, 617 So.2d 880, 882 (La.1993). Where there is conflicting testimony, findings based on reasonable credibility determinations and reasonable inferences of fact will not be disturbed upon review. See Stobart v. State through DOTD, supra at 882, Rosell v. ESCO, 549 So.2d 840, 844-845 (La.1989), and Canter v. Koehring Co., 283 So.2d 716, 724 (La.1973). The issue to be resolved by this court is not whether the trier of fact was right or wrong, but whether the fact finder's conclusion was a reasonable one. Stobart v. State through DOTD, supra at 882. Having reviewed all the testimony and exhibits, we conclude that the finding that the vessel involved in the accident was the SEALAND CONSUMER was reasonable.
Applicable Law of Negligence
By their next assignment of error, appellants argue that the trial court erred when imposing liability on the defendants without making a specific finding that Captain Blancq's actions constituted gross negligence or misconduct. Appellants argue that the proper standard for determining whether liability can be imposed on a river port pilot is found in La.R.S. 34:1001(D), which provides:
Any party seeking to hold a pilot acting under his state commission issued in accordance with this Chapter liable for damages or loss occasioned by the pilot's errors, *1274 omissions, fault, or neglect shall be required to prove by clear and convincing evidence that the damages arose from the pilot's gross negligence or willful misconduct.
Appellees argue that this state statute is preempted by federal maritime law, which places a much higher standard of care on a river port pilot. See Atlee v. Packet Co., 88 U.S. (21 Wall) 389, 396-97, 22 L.Ed. 619 (1874); Bunge Corp. v. M/V Furness Bridge, 558 F.2d 790, 798 n. 6 (5th Cir.1977), cert. denied, sub nom., Furness Withy & Co., Ltd. v. Bunge Corporation, 435 U.S. 924, 98 S.Ct. 1488, 55 L.Ed.2d 518 (1978), Melbourne Bros. Const. v. Gnots-Reserve, 461 So.2d 1145, 1149 (La.App. 5th Cir.1984).
Because we find that the record supports a finding that the pilot was grossly negligent in traveling through the area at an excessive rate of speed while the plaintiff's boat was moored at the dock with its running lights on, we need not decide whether federal maritime law preempts application of La.R.S. 34:1001(D) in the instant case. The pilot is liable for consequential damages under both state and federal standards of negligence.
Defendants also argue the trial court erred in relying on navigation requirements imposed on vessels in crowded harbors and in dense fog to find that the actions of the SEALAND CONSUMER in a shipping channel were negligent.
The testimony of the plaintiff's witnesses supports a finding that quite a few vessels were routinely found in the shipping channel. Moreover, pursuant to the provisions of 33 U.S.C. 2006 which the trial court also relied upon, the SEALAND CONSUMER was clearly negligent for traveling at a speed which did not allow the personnel aboard the SEALAND CONSUMER to see that the KOOL BREEZE was moored at the dock. The finding that this action constituted negligence is further bolstered by the testimony that the KOOL BREEZE had its lights on and the dock at which it was moored was also well lit. Additionally, Captain Blancq had passed this area on numerous occasions and had seen boats moored at the dock on at least one previous occasion. Yet, neither the Captain nor any of the personnel aboard the SEALAND CONSUMER could testify to having observed the KOOL BREEZE while it was moored at the dock on the night in question.
Nor do we find merit in defendants' contention that the trial court erred in applying a presumption of fault applicable only where properly moored vessels are damaged by wave wash to a case involving personal injuries aboard an improperly moored vessel.
Koepp and Lodriguss testified that the boat was properly moored to the dock. Moreover, defendants presented no expert evidence at trial to support a finding that the vessel was not properly moored. Consequently, the trial court did not abuse its discretion by implicitly accepting the testimony of the plaintiff's witnesses.
Accordingly, none of defendants' arguments concerning the applicable standard to be used in determining negligence has merit.
Negligence of the defendants
In its next assignment of error appellants argue the trial court erred in finding defendant SEALAND CONSUMER was negligent in a) failing to keep a proper lookout; b) travelling at an excessive and unsafe speed; and c) creating an excessive swell.
In his reasons for judgment, the trial judge stated:
The evidence demonstrates that the Defendants were negligent in failing to keep a proper lookout, in traveling at an excessive and unsafe rate of speed, and in negligently creating an excessive swell thereby causing the Plaintiff's injuries.
The evidence adduced at trial clearly supports the trial court's finding that the negligence of the defendants caused the plaintiff's injuries.
Lodriguss testified that prior to the accident he had the radio tuned to channel 67 (the bridge to bridge frequency channel for ship traffic). He never heard anyone try to contact the boat regarding their approach to the intersection of the intercoastal waterway and Mississippi River Gulf Outlet. Further, after the SEALAND CONSUMER passed through the area, he tried to contact the ship *1275 via radio but received no response. Receiving no response, Loudriguss radioed channel 13 and asked a friend if he could get the name of the ship. The friend informed Loudriguss that the name of the ship which had just passed was SEALAND CONSUMER. Loudriguss then returned to channel 67 and tried calling the vessel by name, but still received no response. He also tried calling the vessel on channels 16 and 13, but did not receive a response.
Defendant's argument that the trial court erred in finding there was no lookout aboard the SEALAND CONSUMER has no merit. The defendants produced no credible evidence to support a finding that a lookout was present when the SEALAND CONSUMER went past the dock. The trial court apparently concluded that had a lookout been present, the crew could have spotted the KOOL BREEZE moored at the dock and could possibly have taken some type of action to avoid the accident. Nor do we find merit to the argument that the court erred in finding that failure to have a lookout constituted negligence since the crew on the forward bridge of the SEALAND CONSUMER could see anything the lookout could have seen. No testimony was adduced at trial to demonstrate that anyone aboard the SEALAND CONSUMER observed the KOOL BREEZE moored at the dock.
The record also contains evidence to support a finding that the SEALAND CONSUMER was traveling at a speed fast enough to cause a tremendous wave swell five to six feet high. The wave swell was so high that it came over the top of the bulkhead and caused the boat to rock hard enough for tools on deck and fifty pound bags of salt on the cabin to slide overboard.
In addressing the issue of what constitutes excessive speed the trial court correctly referred to the applicable standard for determining negligence in this case when it noted:
33 U.S.C. 2006 (Rule of the Inland Navigational Rules) provides:
Section 2006. Safe speed (Rule 6)
Every vessel shall at all times proceed at a safe speed so that she can take proper and effective action to avoid collision and be stopped within a distance appropriate to the prevailing circumstances and conditions.
In determining a safe speed the following factors shall be among those taken into account:
(a) By all vessels:
(i) the state of visibility;
(ii) the traffic density including concentration of fishing vessels or any other vessels;
(iii) the maneuverability of the vessel with special reference to stopping distance and turning ability in the prevailing conditions;
(iv) at night the presence of background light such as from shore lights or from back scatter of her own lights;
(v) the state of wind, sea, and current, and the proximity of navigational hazards;...
Irrespective of whether the harbor was crowded at the time that the SEALAND CONSUMER passed through the area, the provisions of the above captioned statute dictate that vessels travel at a safe speed at all times. Consequently, the issue of whether the court incorrectly considered cases involving crowded harbors need not be considered.
The court correctly applied the test enunciated in New Orleans Steamboat Co. v. M/T Hellespont Glory, 562 F.Supp. 391 (E.D.La. 1983) for determining the duty of the SEALAND CONSUMER when passing a dock. In that case the court stated:
A ship passing piers or docks where other vessels are tied up is obligated to proceed carefully and prudently so as to avoid creating unusual swells or suction which would damage craft properly moored or installations along the shoreline. The moving vessel must take into consideration the reasonable effects to be anticipated from its speed and motion through the water and must take such precautions by way of reduction of speed or alteration of course as may be reasonably necessary to prevent such damage. (citations omitted).
New Orleans Steamboat Co. v. M/T Hellespont Glory, supra at 392.
*1276 Despite the fact that Captain Blancq was very familiar with the traffic in this area and despite the fact that he was an experienced river boat pilot, he allowed the SEALAND CONSUMER to proceed past the LP & L dock at a speed sufficient to damage the plaintiff's boat and cause a tremendous suction. Moreover the testimony indicates that Captain Blancq never saw the KOOL BREEZE moored to the dock. These factors are sufficient to support the trial court's finding that Captain Blancq was negligent in allowing the SEALAND CONSUMER to proceed through the area in question at an unsafe speed and without keeping a proper lookout.
Negligence of the Plaintiff
By their next assignment of error, appellants argue the trial court erred in finding plaintiff, Koepp, free from fault. Appellants argue that the trial court should have assigned some fault to the plaintiff since the plaintiff was negligent in 1) jumping from a place of safety onto the KOOL BREEZE as it allegedly thrashed about; 2) failing to move to a place of safety as the dangerous swells approached the KOOL BREEZE; 3) having the KOOL BREEZE moored in an unsafe fashion at a restricted dock with its running lights on; 4) failing to attempt to contact the approaching ship until it was too close to the KOOL BREEZE to take effective action; 5) failing to move the KOOL BREEZE away from the LP & L dock; and 6) failing to show warning lights or flares to warn approaching vessels that the KOOL BREEZE was in distress.
The record contains ample evidence to support a finding that the sole cause of this accident was the negligence of the defendants in proceeding through the channel at an excessive speed, failing to observe the plaintiff's boat moored to the dock, and causing an enormous wave swell. When confronted with the unusually large wave, the plaintiff took reasonable measures to avoid injury. Moreover, as stated earlier, the record is completely devoid of any credible evidence to substantiate a finding that the plaintiff's boat was not properly moored to the dock. Nor do we find merit to the assertion that the plaintiff was negligent in failing to show warning lights or flares since the testimony clearly indicates that both the KOOL BREEZE and the dock had sufficient light to allow a passing vessel to observe the KOOL BREEZE. Defendants' contention that the plaintiff's negligence should bar and/or reduce his recovery has no merit.
Expert Witnesses
Appellants argue the trial court manifestly abused its discretion by accepting, without explanation or rationale, the testimony of plaintiff's navigation experts and rejecting entirely the testimony of defendant's navigation experts.
The law is well-settled that where the testimony of expert witnesses differs, the trier of fact has great discretion in determining the credibility of the evidence, and a finding of fact in this regard will not be overturned unless clearly wrong. DeSambourg v. Board of Com'rs for Grand Prairie Levee Dist., 608 So.2d 1100, 1108 (La.App. 4th Cir.1992), affirmed, 621 So.2d 602 (La. 1993), citing A. Copeland Enterprises v. Harimaw, Inc., 528 So.2d 707 (La.App. 5th Cir. 1988), writ denied 531 So.2d 475 (La.1988).
The assessment of credibility of competing expert witnesses is best left to the trier of fact, who has the opportunity to observe the respective demeanor of the witnesses. Cash v. Charter Marketing Co., 607 So.2d 1036, 1039 (La.App. 3 Cir.1992).
Where there is evidence before the trier of fact which, upon its reasonable evaluation as to credibility, furnishes a reasonable basis for the trial court's finding, it should not be disturbed in the absence of manifest error. Ardoin v. Evangeline Parish School Bd., 376 So.2d 372, 373-374 (La.App. 3d Cir. 1979).
In the instant case both plaintiffs' and defendants' experts were qualified and the trial court's reliance on the testimony of plaintiff's experts was a proper exercise of its discretion. Having reviewed the record, we find the trial court's findings of fact and conclusions of law are amply supported by the evidence.
*1277 Excessiveness of Damages
Appellants argue the trial court erred in awarding $400,000 in general damages because 1) there is no competent evidence to establish that the plaintiff suffered significant injury beyond a chronic back strain as a result of the accident and 2) the award is excessive even for a herniated disc.
The standard of appellate review of general damages awards was enunciated in Youn v. Maritime Overseas Corp., 623 So.2d 1257, 1261 (La.1993), cert. denied, ___ U.S. ___, 114 S.Ct. 1059, 127 L.Ed.2d 379 (1994), wherein the court stated:
The standard for appellate review of general damage awards is difficult to express and is necessarily non-specific, and the requirement of an articulated basis for disturbing such awards gives little guidance as to what articulation suffices to justify modification of a generous or stingy award. Nevertheless, the theme that emerges from Gaspard v. LeMaire, 245 La. 239, 158 So.2d 149 (1963) through Coco v. Winston Industries, Inc., 341 So.2d 332 (La.1976), and through Reck to the present case is that the discretion vested in the trier of fact is "great," and even vast, so that an appellate court should rarely disturb an award of general damages. Reasonable persons frequently disagree about the measure of general damages in a particular case. It is only when the award is, in either direction, beyond that which a reasonable trier of fact could assess for the effects of the particular injury to the particular plaintiff under the particular circumstances that the appellate court should increase or reduce the award.
In Youn, supra, the Louisiana Supreme Court recognized the need for examining the particular effect of the injuries on the particular party to the litigation when it stated:
In Reck, this court disapproved the appellate court's simply reviewing the medical evidence and then concluding that the award for those injuries was excessive, without taking into consideration the particular effect of the particular injuries on the particular plaintiff. This court further disapproved of the use of a scale of prior awards in cases with generically similar medical injuries to determine whether the particular trier of fact abused its discretion in the awards to the particular plaintiff under the facts and circumstances peculiar to the particular case. The initial inquiry is whether the award for the particular injuries and their effects under the particular circumstances on the particular injured person is a clear abuse of the "much discretion" of the trier of fact. Gaspard v. LeMaire, 245 La. 239, 158 So.2d 149 (1963); Ballard v. National Indem. Co. of Omaha, Neb., 246 La. 963, 169 So.2d 64 (1964); Lomenick v. Schoeffler, 250 La. 959, 200 So.2d 127 (1967). Only after such a determination of an abuse of discretion is a resort to prior awards appropriate and then for the purpose of determining the highest or lowest point which is reasonably within that discretion. Coco v. Winston Industries, Inc., 341 So.2d 332 (La.1976); Bitoun v. Landry, 302 So.2d 278 (La.1974); Spillers v. Montgomery Ward & Co., 294 So.2d 803 (La.1974).
Youn, supra at 1260.
Dr. Llewellyn, an expert in the field of neurosurgery, diagnosed plaintiff as having extruded disc herniation at the L4-5 and L5-S1 levels, as well as a bulging disc at L3-4.
Dr. Llewellyn, the plaintiff's treating physician, first saw the plaintiff on May 14, 1991. At that time the plaintiff stated that he injured his back in an incident that had occurred on a boat. Plaintiff underwent several medical tests. An MRI documented the presence of an irreparable tear of the two lower most joints in his lower back and showed extruded disc herniation of L4-5 and L5-S1. An EMB verified the finding on the MRI of the involvement of the L-5 dermatome. Dr. Llewellyn concluded that plaintiff had a neurosurgical aspect of these injuries, that is, disc ruptures with nerve infragment involving his left leg. Plaintiff elected to pursue conservative treatment for six to eight months to see if pain would lessen so that he might escape an operating procedure. He felt this method was acceptable and on 6/11/91 he started that program.
*1278 Plaintiff came back four months later on October 4, 1991. He was not working. In light of his family history of diabetes, tests were performed and he was found to be diabetic. The doctor placed him on diet control for weight and diabetes as part of the rehabilitative efforts. Plaintiff was placed on medical restriction by Dr. Llewellyn, who advised the plaintiff to be active only to tolerance, not to attempt light work, to rest each morning and each afternoon after taking hot showers, and to take his medication and lie down. Dr. Llewellyn also advised the plaintiff against being active to the point of being tired or sore and to strenuously avoid those types of exertions or amounts of exertion that inevitably made his back or leg pain worse. The medical testimony supports a finding that the plaintiff's injuries were severe and necessitated a drastic change in the kinds of activities the plaintiff could engage in.
Considering the severe nature of the plaintiff's injuries, we are unable to say that the trial judge abused his "much discretion". Pursuant to Youn, supra, this court has no authority to decrease the general damage award of the jury.
Next, appellants argue the trial court awarded duplicative damages for loss of enjoyment of life and permanent residual disability in that such damages are included in the separate award for both physical and mental pain and suffering and for loss of earning capacity made by the court.
The trial court awarded plaintiff $400,000.00 in general damages and $145,532.00 in damages for loss of past and future earning capacity. The trial court arrived at the $400,000.00 figure by awarding $150,000.00 for past and future physical pain and suffering, $100,000.00 for mental pain and suffering, and $150,000.00 for loss of enjoyment of life and permanent residual disability. The defendants do not contest the $145,532 award for loss of past and future earning capacity. However, defendants argue that the trial court erred in awarding $150,000 for loss of enjoyment of life and permanent residual disability.
In Downie v. United States Line Co., 359 F.2d 344, 347 (3rd Cir.1966), cert. denied 385 U.S. 897, 87 S.Ct. 201, 17 L.Ed.2d 130 (1966), the court discussed the various elements of damages allowed to be recovered under maritime law, noting:
The injured seaman is also entitled to compensation, again based on life expectancy at the time of injury, for the physical and mental effects of the injury on his ability to engage in those activities which normally contribute to the enjoyment of life.... (emphasis added) [citations omitted].
The plaintiff is entitled to receive compensation for the physical effects which impair his ability to engage in life enjoying activities; plaintiff is also entitled to receive compensation for the mental effects which impair his ability to engage in life enjoying activities. Plaintiff is not entitled to receive compensation for physical and mental effects of the injury plus compensation for loss of enjoyment of life, for loss of enjoyment of life constitutes the basis for the physical and mental components.
In Hanson v. Reiss Steamship Co., 184 F.Supp. 545 (D.Del., 1960) the Court analyzed frequently used terms such as `inconvenience', `embarrassment', `loss of pleasure and enjoyment of life' and `inability to engage in normal activities' in arriving at reasonable amounts of damages. The Hanson court held that these quoted terms are cited merely as showing factors sometimes involved in pain and suffering, especially mental suffering. Id. at 553. The $154,000.00 award for loss of enjoyment of life is duplicative and the award must be amended.
Appellants also argue the trial court erred 1) by finding defendants caused plaintiff's inability to return to gainful employment; 2) by failing to give consideration to plaintiff's two previous back injuries and his post incident neck and back injuries, and 3) by failing to consider the fact that the plaintiff failed to follow his physicians's orders and thereby mitigate his damages.
The evidence supports a finding that plaintiff is unable to return to gainful employment, particularly in view of the numerous medical restrictions placed on him by Dr. Llewellyn. Plaintiff was apparently engaged *1279 in gainful employment prior to the accident and there is no evidence to support a finding that the previous accidents adversely affected his ability to work. Additionally, the record contains no evidence of any purposeful, intentional failure on the part of the plaintiff to follow physician's orders. Thus, this assignment of error has no merit.
Nor do we find any merit to the appellants' contention that the trial court erred in awarding damages based on a determination plaintiff could not work at all in the future when plaintiff worked for almost all of the 33 months between the accident and trial and when his treating physician's diagnosis of herniated disks was equivocal. The testimony adduced at trial supports a finding that the plaintiff missed a great deal of work during the time in question because of his back problems. Additionally, his treating physician placed numerous restrictions on him. The fact that he attempted to continue working in spite of his medical problems does not negate a finding that he will not be able to continue to work in the future.
Consistent with the views expressed in this opinion, that portion of the judgment of the trial court awarding the plaintiff $150,000.00 for "loss of enjoyment of life and permanent residual disability" is reversed. The judgment of the trial court is amended to award the plaintiff a total of $403,343.01. In all other respects, the judgment of the trial court is affirmed.
REVERSED IN PART, AFFIRMED AS AMENDED AND RENDERED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1032334/ | IN THE COURT OF APPEALS OF THE STATE OF IDAHO
Docket No. 39441
STATE OF IDAHO, ) 2013 Unpublished Opinion No. 568
)
Plaintiff-Respondent-Appellant on ) Filed: July 8, 2013
Appeal, )
) Stephen W. Kenyon, Clerk
v. )
) THIS IS AN UNPUBLISHED
JOHN HUNTINGTON WILKS, ) OPINION AND SHALL NOT
) BE CITED AS AUTHORITY
Defendant-Appellant-Respondent )
on Appeal. )
)
Appeal from the District Court of the Third Judicial District, State of Idaho,
Payette County. Hon. Thomas Joseph Ryan, District Judge. Hon. A. Lynne
Krogh, Magistrate.
District court appellate decision setting aside judgment of conviction in magistrate
division, reversed; judgment of conviction for maintaining a nuisance, affirmed.
Hon. Lawrence G. Wasden, Attorney General; Lori A. Fleming, Deputy Attorney
General, Boise, for appellant.
Charles D. Coulter, Boise, for respondent.
________________________________________________
WALTERS, Judge Pro Tem
This is an appeal by the State from an intermediate appellate decision by the district court
that set aside a judgment of conviction entered in the magistrate division for maintaining a
nuisance in violation of a city code. We reverse the district court’s decision and affirm the
judgment of conviction.
I.
FACTS AND PROCEDURE
John Huntington Wilks was charged with violation of an ordinance of the City of
Fruitland that regulates nuisances. Specifically, the city prosecutor alleged that Wilks
“knowingly and unlawfully allow[ed] a junk vehicle to remain on his property within the City [a]
Public nuisance, which is in violation of Fruitland City Code 8-2B-1, a misdemeanor.” Wilks
1
was also charged with an additional violation for allowing weeds to grow above eight inches
high on the same property. After a trial before the court without a jury, a magistrate found Wilks
guilty of the vehicle nuisance violation, but not guilty of the charge relating to the growth of
weeds. The magistrate rejected Wilks’ asserted defense that he had a constitutionally-protected
right to maintain inoperable motor vehicles on the property in question, which preceded the
annexation of the property into the City and also preceded the adoption of the ordinance Wilks
was charged with violating. On appeal to the district court, the district court set aside the
judgment of conviction entered by the magistrate, concluding that Wilks’ use of the property is
constitutionally protected and protected under Idaho law as a preexisting, nonconforming use.
The State has appealed from the district court’s intermediate appellate decision.
II.
ANALYSIS
On review of a decision of the district court, rendered in its appellate capacity, we review
that decision directly and examine the magistrate record to determine whether there is substantial
and competent evidence to support the magistrate’s findings of fact and whether the magistrate’s
conclusions of law follow from those findings. Losser v. Bradstreet, 145 Idaho 670, 672, 183
P.3d 758, 760 (2008); State v. DeWitt, 145 Idaho 709, 711, 184 P.3d 215, 217 (Ct. App. 2008).
When a criminal action has been tried before a court sitting without a jury, appellate review of
the sufficiency of the evidence is limited to ascertaining whether there is substantial evidence
upon which a court could have found that the prosecution met its burden of proving the essential
elements of the crime beyond a reasonable doubt. State v. Bettwieser, 143 Idaho 582, 588, 149
P.3d 857, 863 (Ct. App. 2006); State v. Smith, 139 Idaho 295, 298, 77 P.3d 984, 987 (Ct. App.
2003). We are precluded from substituting our judgment for that of the fact finder as to the
credibility of witnesses, the weight of evidence, and the reasonable inferences to be drawn from
the evidence. State v. Vandenacre, 131 Idaho 507, 510, 960 P.2d 190, 193 (Ct. App. 1998); State
v. Hickman, 119 Idaho 366, 367, 806 P.2d 959, 960 (Ct. App. 1991). We conduct free review of
questions of law presented. Martel v. Bulotti, 138 Idaho 451, 453, 65 P.3d 192, 194 (2003)
(citing Polk v. Larrabee, 135 Idaho 303, 308, 17 P.3d 247, 252 (2000)).
The facts presented at trial and supporting the magistrate’s determination that Wilks was
guilty of violating the junk vehicle nuisance ordinance were largely undisputed. They show that
in 1950, Wilks’ parents purchased real property in Payette County, recording the deed in 1952.
2
The property was annexed into the City of Fruitland in 1967 and was zoned for single family
residential use. In 1973, the Fruitland City Council adopted the ordinance making it unlawful for
any person to maintain a junk motor vehicle on residential property for a period of more than
thirty days. 1 Three years later, the City adopted the ordinance making it unlawful to allow weeds
to exceed eight inches in height on property within the city limits.
In June 2010, the Fruitland City Police Chief received complaints about the growth of
weeds and the storage of junk motor vehicles on the Wilkses’ property. After officers visited the
property and viewed its condition, Wilks was charged with maintaining junk motor vehicles on
residential property and with allowing the growth of weeds in violation of the pertinent sections
of the city ordinances regulating such matters. At trial, several neighboring residents testified
about the condition of the Wilkses’ property, including the accumulation of more and more junk
vehicles on the property over a period of several years. City officials testified that there had been
junk vehicles on the property for several years and that despite being served with numerous
notices informing him of the ordinance violations, Wilks never removed the junk vehicles from
the property.
Wilks testified that the residential property was still owned by his parents, at least by his
mother since his father had passed away in 2009, and that he had no present interest in the
property, but that he was the sole heir to his parents’ property because his only sister had also
recently passed away. He testified that both he and his mother presently live in Ontario, Oregon,
and not on the Fruitland property. The domestic water service to the property has been shut off.
He testified that his father began collecting vehicles and storing them on the property in 1950.
Occasionally, his father would sell one of the vehicles, but some of them had been on the
property for up to fifty years. Wilks further testified that he owned most of the vehicles on the
1
Fruitland City Code (FCC) § 8-2B-2(B) provides, “It shall be unlawful for any person to
maintain a junk motor vehicle, vehicles, or parts thereof on residential property or business
property for a period of more than thirty (30) days.” There are exceptions to the prohibition
against maintaining junk motor vehicles on residential property, including where the vehicle is
“completely enclosed within a building in a lawful manner where it is not visible from the street
or other public or private property” (FCC § 8-2B-3(A)); where the vehicle is stored or parked on
private property in connection with a business of a licensed dismantler, vehicle dealer or junk
dealer, or where the vehicle’s storage is necessary to the operation of a lawfully conducted
business or commercial enterprise (FCC § 8-2B-3(B)); and for regularly used recreational
vehicles and for vehicles owned by active duty military personnel stationed outside the state
(FCC § 8-2B-3(C), (D)). It is undisputed that none of these exceptions applied in Wilks’ case.
3
property and that he had started storing vehicles on the property in 1962. He admitted that
neither he nor his father was duly licensed to be a collector or dismantler of vehicles or to
operate a junkyard business on the property.
At the conclusion of the evidence, Wilks moved to dismiss the junk motor vehicle charge,
arguing that the storage of junk vehicles on his parents’ property constituted a preexisting,
nonconforming use that is constitutionally protected. The magistrate denied Wilks’ motion and
found that Wilks was guilty of maintaining junk vehicles on residential property in violation of
the city ordinance. 2 The court said:
With respect to the argument about constitutionality, Mr. Wilks is not
being prohibited from owning junk vehicles. He is not prohibited from owning as
many junk vehicles as he wants to own. The county and the city can adopt
reasonable ordinances to promote the safety and welfare of the public, and that
includes saying that if you’re going to have junk vehicles you either have to keep
them behind a fence or stored in an appropriate facility so the place doesn’t look
like a junkyard that devalues other properties in the neighborhood.
So the [ordinance] is not unconstitutional, and Mr. Wilks is in violation of
it by having junk vehicles that belong to him that are on the property that are not
licensed, not registered, not operable, and not behind a fence or in a building.
The magistrate entered a judgment of conviction, fined Wilks $300, and sentenced Wilks
to serve thirty days in jail. The court set a review date for six weeks in the future and withheld
imposition of the jail sentence pending the review date to give Wilks time to present proof that
each of his vehicles either was operating and registered, or stored in an outbuilding, or removed
from the property, in which case the jail term would be suspended.
On Wilks’ appeal to the district court, the district court held that Wilks’ use of the real
property was the same use to which the property had been put before and after the adoption of
the zoning ordinance by the City of Fruitland. Accordingly, the district court ruled that “the
current use of the Wilks’ property is a constitutionally protected pre-existing non-conforming use
and as such is protected under Idaho law.” The State contends that the district court erred in its
conclusion because Wilks lacked standing to assert a claim of a preexisting, nonconforming use
that is constitutionally protected (commonly referred to as a “grandfather” right) inasmuch as
Wilks was not the owner of the residential property where the junk motor vehicles were located.
2
The magistrate found Wilks not guilty of violating the city weed ordinance because there
was no evidence that Wilks owned the real property or otherwise was responsible for
maintaining the land.
4
Although the State had raised the standing issue on the appeal to the district court, the district
court did not explicitly address that issue in its appellate decision, inferentially determining that
Wilks did have standing to claim the grandfather right.
We conclude that the State is correct in its assertion that Wilks’ storage of his inoperable
motor vehicles on his parents’ property is not protected as a preexisting, nonconforming use
because Wilks is not the owner of the real property. It is well recognized that a nonconforming
use is a use of land which lawfully existed prior to the enactment of a zoning ordinance and
which is maintained after the effective date of the ordinance even though not in compliance with
use restrictions. Kootenai Cnty. v. Harriman-Sayler, 154 Idaho 13, 18, 293 P.3d 637, 642
(2012); Baxter v. City of Preston, 115 Idaho 607, 608-09, 768 P.2d 1340, 1341-42 (1989).
Furthermore, it is a property-right protection based upon the state and federal due process
clauses. Harriman-Sayler, 154 Idaho at 18, 293 P.3d at 642; Baxter, 115 Idaho at 608-09, 768
P.2d at 1341-42; Boise City v. Blaser, 98 Idaho 789, 572 P.2d 892 (1977); O’Connor v. City of
Moscow, 69 Idaho 37, 202 P.2d 401 (1949). Often referred to as a “grandfather right,” a
nonconforming use simply protects the owner from abrupt termination of what had been a lawful
condition or activity on the property; the protection does not extend beyond this purpose.
Harriman-Sayler, 154 Idaho at 18, 293 P.3d at 642; Baxter, 115 Idaho at 608-09, 768 P.2d at
1341-42.
Given that grandfather rights are property rights, obviously a claimant will be unable to
establish a nonconforming use where the claimant has no proprietary interest in the land. See
Eric M. Larsson, Cause of Action to Obtain Zoning Exemption Based Upon Nonconforming Use,
§ 16, in 36 CAUSES OF ACTION 583 (2d ed. 2013). The Court of Appeals of Michigan discussed
this principle in Gerrish Twp. v. Esber, 506 N.W.2d 588 (Mich. Ct. App. 1993), where the
township brought suit seeking the removal of two signs advertising the defendants’ grocery store,
which violated a zoning ordinance passed after their placement. The signs were located on a
piece of land owned by the state approximately a mile from the store. The defendants argued
placement of the signs was a valid nonconforming use; however, the court pointed out that the
defendants overlooked the fact that the signs were not on their property. Id. Noting that
permitting the continuation of a nonconforming use is designed to avoid the imposition of
hardship upon the owner of property, the court rejected the defendants’ assertion of a valid
nonconforming use because the defendant had no property right to be protected in this instance.
5
Id. Accord Young v. Planning Comm’n of Cnty. of Kauaʽi, 974 P.2d 40, 50 (Haw. 1999)
(holding that because “the zoning law concept of ‘non-conforming use’ protects landowners who
have vested rights to use their land in a fashion later prohibited by restrictive zoning
regulations,” the plaintiff, who had no proprietary interest in the land under which he was
operating his tour boat or any vested interest in use of the bodies of water, could not claim a
valid nonconforming use); The Lamar Co., LLC v. City of Fremont, 771 N.W.2d 894, 903 (Neb.
2009) (holding that because the right to maintain a legal nonconforming use “runs with the land,”
where claimant’s leasehold had been terminated on the land, the claimant no longer had
ownership interests in the nonconforming use rights and did not have standing to challenge the
relevant ordinance); Haher’s Sodus Point Bait Shop, Inc. v. Wigle, 139 A.D.2d 950, 950 (N.Y.
App. Div. 1988) (holding claimant had no right to use of land later prohibited by restrictive
zoning regulations where it did not own the land upon which the contested use existed).
Although generally referring to the “owner” of land on which the nonconforming use
runs, case law is clear that the benefit of a nonconforming use may inure to a subsequent
transferee who obtains a proprietary interest in the land as a result of a transfer of title, such as by
mortgage foreclosure or inheritance. See Budget Inn of Daphne, Inc. v. City of Daphne, 789 So.
2d 154, 159 (Ala. 2000) (noting that the right to a nonconforming use is one of the “‘bundle of
rights’ which together constitute the attributes of ownership of the land” extending to a new
owner of the property) (citing 4 RATHKOPF’S THE LAW OF ZONING AND PLANNING, § 51.03
(1994)).
While Wilks may have had permission from his mother to store his motor vehicles on her
property, this appears to have been an inchoate interest terminable at will by Mrs. Wilks and did
not create an enforceable proprietary interest or attribute of ownership that Wilks could claim
was attached to the property as a right devolving to him.
Wilks did not establish that he had any proprietary interest through ownership or by
leasehold in the Fruitland property. He therefore lacked standing to assert a right to maintain a
use of his parents’ property not in conformity with the Fruitland City ordinances.
6
III.
CONCLUSION
The intermediate appellate decision of the district court is reversed and the judgment of
conviction entered in the magistrate division, for maintaining junk vehicles in violation of the
Fruitland City ordinance, is affirmed.
Judge LANSING and Judge MELANSON CONCUR.
7 | 01-03-2023 | 07-08-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603738/ | 645 So.2d 1311 (1994)
Albert NECAISE
v.
OAK TREE SAVINGS BANK, SSB.
No. 91-CA-00696.
Supreme Court of Mississippi.
November 10, 1994.
Gail D. Nicholson, Chester D. Nicholson, Nicholson & Nicholson, Gulfport, for appellant.
Billy Parlin, Parlin & Murphy, Ocean Springs, for appellee.
Before PRATHER, P.J., and BANKS and SMITH, JJ.
SMITH, Justice, for the Court:
The Circuit Court of Harrison County reversed a judgment rendered by the County Court of Harrison County adjudicating that Albert Necaise was entitled to the sum of $2,200 from insurance proceeds paid in the wake of an oral contingency fee contract entered into with a client, Richard Parker, *1312 whose mobile home was demolished by a tornado on May 19, 1989.
Necaise, an attorney, appeals from an order entered May 28, 1991, by the Circuit Court of Harrison County, sitting in its posture as an appellate court, reversing a decision made by the County Court. The County Court, following a bench trial on an action for declaratory judgment filed by Necaise, had held that Necaise was entitled to an interest in a check issued in the amount of $10,000 by Liberty National Fire Insurance Company to three payees: (1) Richard Parker, the insured; (2) Necaise, Parker's lawyer; and (3) Oak Tree Savings Bank, a lienholder, mortgagee, and loss payee.
Necaise claimed he was entitled to one third (1/3) of the insurance proceeds check issued by Liberty based upon his contingency fee contract with Parker and because a settlement with Liberty was reached largely through his efforts and the efforts of his associate. Necaise maintained that the County Court reached a proper resolution in the case when it allowed "an equitable quantum meruit ... for legal services in representing the mortgagee against Liberty Fire Insurance Company."
Oak Tree, on the other hand, claimed that as a named loss payee on the insurance policy it was entitled to proceeds up to the amount of its outstanding security interest. In this particular case, that would amount to the entire insurance proceeds, since the mortgage balance exceeded the amount of the proceeds.
The lienholder clause endorsement attached to and forming a part of the insurance policy states, in part, as follows:
Any loss payable under this policy shall be paid to Dixie Savings & Loan ... as lienholder, and you [Parker] as interests appear.
In the final analysis, Necaise entered into an oral contingency fee contract with Parker who had executed a security agreement with Oak Tree upon the purchase of a mobile home. Parker was obligated to purchase fire and casualty insurance and named Dixie in a lienholder clause endorsement as loss payee. This entitled Oak Tree to payment of the insurance proceeds up to the amount of the outstanding lien on the mobile home. Hartford Fire Insurance Company v. Associates Capital Corporation, 313 So.2d 404, 407 (Miss. 1975). After a thorough examination of the single issue raised by Necaise, we concur with Oak Tree's position that the law and facts support the reversal by the circuit judge of the county court's ruling; therefore, we must affirm.
STATEMENT OF FACTS
Albert Necaise, hereinafter "Necaise", is a practicing attorney in Gulfport who represented Richard Parker against Liberty National Fire Insurance Company after Parker's mobile home was destroyed by a tornado.
Richard Parker, hereinafter "Parker", is the owner/mortgagor of a mobile home in Saucier which he financed through Oak Tree Savings Bank.
Oak Tree Savings Bank, hereinafter "Oak Tree", is the lienholder on the mobile home, a mortgagee, and a loss payee.
Dixie Savings and Loan, hereinafter "Dixie", is the predecessor in interest to Oak Tree.
Liberty National Fire Insurance Company, hereinafter "Liberty", issued $10,000 worth of fire and casualty insurance on the mobile home and $4,000 on its contents.
Jay Disharoon, hereinafter "Disharoon", was an attorney working as an associate for Necaise during the course of the representation of Parker.
Parker, a resident of Saucier, purchased a mobile home which he financed through Dixie, predecessor in interest to Oak Tree. In consideration of the financing, Dixie (Oak Tree) was granted a security interest in the mobile home. By virtue of the terms of the security agreement, Parker was obligated to purchase a fire and casualty insurance policy. On May 9, 1988, Liberty issued a Mobile Home Dwelling Policy to Parker with liability limits of $10,000 and a Mobile Home Household Contents Policy with liability limits of $4,000. A lienholder clause endorsement attached to the dwelling policy specifically *1313 named Dixie, predecessor in interest to Oak Tree, as loss payee.
On or about May 19, 1989, the mobile home and most of its contents were destroyed by a tornado. At the time of the loss, the outstanding balance on Parker's loan with Oak Tree was $11,680.67. Parker filed a claim with Liberty which Liberty initially refused to pay for nonpayment of premiums. Enter Mr. Necaise and his associate, Mr. Disharoon.
According to the trial testimony, Parker retained Necaise on a contingency fee basis to collect the insurance proceeds from Liberty. Under the terms of their oral agreement, Parker agreed to pay to Necaise a third of any recovery made from Liberty. Necaise, through Disharoon, wrote several letters and made a number of telephone calls to Liberty in an effort to induce the carrier to pay. There was talk of a lawsuit based upon "bad faith" but no suit was filed.
Meanwhile, Oak Tree, unaware that Necaise had been retained by Parker to assist in the collection process, made efforts through its own collectors to collect the insurance proceeds from Liberty. It concentrated primarily, however, upon collecting from Parker who had stopped paying his premiums.
It was the position of Necaise that Liberty, largely through the efforts of Necaise and his associate to settle the matter, agreed to pay $10,000 for the loss of the mobile home, $2033 on the loss of the contents, and $200 living expenses to Parker. Only the $10,000 is at issue in this appeal.
On August 1, 1989, Liberty mailed a draft in the amount of $10,000 to Necaise made payable to "Richard D. Parker and Oak Tree Savings Bank and Attorney Jay Disharoon." On August 14, 1989, Necaise wrote the following letter to Oak Tree:
This letter is to confirm our telephone conversation of August 11, 1989, wherein I advised that I had settled the above captioned case with Liberty National Insurance Company for $10,000.00. As I informed you, the check is made payable to Mr. Richard Parker, to your company, and also to my office. I advised that our fee for representing the interests of the Parkers and Oak Tree Savings on this matter was one-third of the recovered proceeds. I advised you I would be happy to forward you the check endorsed by Mr. Parker and myself, provided you would remit by return mail one-third of the receipts of the check.
Since you are unwilling to do this I shall retain the check in my file until such time as an agreement can be made as to your company sharing in the attorney's fees for making this recovery. [emphasis added]
On August 22, 1989, Oak Tree responded with the following letter to Necaise:
I am in receipt of your letter addressed to Oak Tree Savings Bank, S.S.B., dated August 14, 1989.
As of this date, your client owes my principal the sum of $11,680.67, which is the balance on his loan. If I receive the check from National, properly endorsed by Mr. Parker and your office within 10 days from the date of this letter, we will accept same as payment in full of the loan.
If I do not receive the check endorsed properly in 10 days, I will institute proceedings against Mr. Parker for $11,680.67, plus interest and all costs.
In addition, I will seek a ruling from the Mississippi Bar Association relative to your retention of the check and demanding a fee from an entity you do not [k]now, nor ever have represented.
The trial court heard testimony from three (3) witnesses produced by the plaintiff: (1) Richard Parker, the insured (2) Jay Disharoon, Necaise's associate who handled the case for Parker; and (3) Albert Necaise himself. Oak Tree produced as its only witness Darlene McDonald, a Litigation Collection Manager.
Relevant testimony elicited during direct examination from Albert Necaise concerning his suit for declaratory judgment is quoted as follows:
[BY MR. NECAISE:]
A. That letter was written by me as a result of having previously talked to Ms. Melissa Taylor, and my reason for calling Ms. Taylor, sometime immediately *1314 prior to the 14th, we had gotten a check in from the insurance company, and the check was made payable to Oak Tree Savings and Loan, Richard Parker, and Jay Disharoon, and the check had to be negotiated because I felt that And Mr. Parker knew that we had a one-third contingency in that check. So, I called Ms. Taylor and I told her that we had the check, that I had gotten the check, and wanted to know how she wanted to do it. That there were several ways that we could do it, if she wanted to give me permission to sign Oak Tree's name, that I would sign it. I would have Mr. Parker sign it, and I would sign it, and I would put it in my trust account. I would deduct a third, and send them a check for six thousand six hundred and sixty-six dollars. She told me they didn't owe it; that Mr. Parker owed it. I said, "No." I said, "You have an interest in it, too." I said, "Now, Mr. Parker may owe you. You know, I'm not saying that by getting six thousand six hundred and sixty-six dollars will make this note will pay it off. You're going to have to proceed against Mr. Parker for any balance that he's going to leave after we apply this amount on his outstanding indebtedness. But the company wouldn't pay, and apparently ya'll were not doing anything. All you all were doing was requesting Mr. Parker to pay his payments, and not only couldn't he pay his payments, he couldn't even get another place to live." I said, "So, through our efforts, we were able to recover." She said, "Well, we're not paying you." I said, "Okay, and if you want me to, I will send you the check like it is, and then you can cut me a check for a third." She said, "We're not going to do that." So, I wrote her this letter, as it sets there, and I said, "Since you're unwilling to do this, I will retain the check in my file until such time as an agreement can be made as to your cut in the sharing of the attorneys fee for making this recovery." And she had a lawyer write me back and told me, you know, that they didn't "That he owes the principal sum, and that if he received the check properly endorsed by Parker and me within ten days that he would accept same as payment in full. But that if he did not receive the properly endorsed check within ten days, that he would institute proceedings against Mr. Parker for eleven thousand and six sixty-seven plus interest and all costs and in addition he would seek a ruling from the Mississippi State Bar Association relative to my retention of the check and demanding a fee from an entity that you do not know nor have ever represented." And he sent Mr. Parker a copy of that letter. Well, of course, you know nobody likes Of course, I took that as, you know, if you don't do this, I'm going to report you to the Bar."
Q. Trying to intimidate you with a Bar complaint?
A. I took that as intimidation. "If you don't do this, the Bar will," and of course, no lawyer You know, I've been practicing law for twenty-five years. You don't like to get those kind. So, I think that was at the time that I consulted you. I didn't think that I ought to handle it, because I think anytime somebody represents himself he has a fool for a client. That's the reason I employed you and your law partner to represent me on the matter, and as best I remember we had determined that it was best to go on and forward the check to them and file a lawsuit against them to prevent them from filing a Bar complaint. I did not send the check to them because I didn't think they owed me a fee. I still think I'm entitled to a fee.
Q. All right, and pursuant to that, Mr. Necaise, you authorized a suit for declaratory judgment here in front of this court,
A. Yes, sir.
Q. And we want the Court to declare the rights of the parties; is that right?
A. Exactly.
After hearing all the testimony, the trial court ruled in favor of Necaise. Specifically, he found that the matter had been adjusted and settled as a result of the efforts of both *1315 parties and awarded Necaise two thirds (2/3) of the amount of his contingency fee of one third (1/3) of the recovery or $2,200. (1/3 of $10,000 = $3,333 X 66 2/3 = $2,200).
The circuit judge, in reviewing the county court's decision, concluded as a matter of law "that the Judgment of the County Court cannot be sustained in law or in fact" and held "that the County Court was manifestly wrong in its decision and erred in entering a Judgment in favor of Albert Necaise against Oak Tree Savings Bank, SSB."
Aggrieved Necaise appealed to this Court raising the single issue:
WHETHER THE CIRCUIT COURT ERRED IN REVERSING THE DECISION OF THE COUNTY COURT.
DISCUSSION
Necaise claimed he was entitled to one third (1/3) of the insurance proceeds check issued by Liberty based upon his contingency fee contract with Parker and because a settlement with Liberty was reached largely through his efforts and the efforts of his associate. Necaise maintained that the County Court reached a proper resolution in the case when it allowed "an equitable quantum meruit ... for legal services in representing the mortgagee against Liberty Fire Insurance Company."
Oak Tree, on the other hand, claimed that as a named "loss payee" on the insurance policy it was entitled to proceeds up to the amount of its outstanding security interest which, in this particular case, is the entire amount of the insurance proceeds since the mortgage balance exceeded the amount of the proceeds.
Necaise's complaint for declaratory judgment alleged that Parker signed a promissory note in the amount of $11,339.70 and gave a security interest in the mobile home to the holder of the note. The complaint further stated in that pursuant to the security agreement, Parker purchased a policy of insurance from Liberty that included a "lienholder clause endorsement."
The lienholder clause endorsement attached to and forming part of the insurance policy states, in part, as follows:
Any loss payable under this policy shall be paid to Dixie Savings & Loan ... as lienholder, and you [Parker] as interests appear.
This Court in Hartford Fire Insurance Company v. Associates Capital Corporation, 313 So.2d 404, 407 (Miss. 1975), speaks of two types of mortgage clauses: "[T]he simple `loss-payable' or `open-mortgage clause,' and the `union' or `standard mortgage clause' are known as Mississippi Form 23 and Form 25, respectively, the last of which was incorporated in our statutory law in Mississippi Code Annotated Section 83-13-9 (1972)."
Under a simple "loss-payable" clause in an insurance policy payable to the mortgagee "as his interest may appear," the mortgagee is only entitled to receive the amount due on the mortgage. Where the "standard mortgage clause" is included in the policy, the mortgagee is entitled to the proceeds of the policy. Hartford, 313 So.2d at 407.
The subject matter of Miss. Code Ann. § 83-13-9 (1991) is the standard union mortgage clause which in the past has been construed by this Court "to be a separate contract of insurance entered into between the mortgagee [Oak Tree] and the insur[e]r [Liberty]." Weems v. American Security Insurance Company, 450 So.2d 431, 436 (Miss. 1984) (Weems I).
In United States v. Sentinel Fire Insurance Company, 178 F.2d 217, 227 (5th Cir.1949), the Fifth Circuit Court of Appeals discussed prior decisions of this Court dealing with the effect of a standard union mortgage clause:
In Hennessey v. Helgason, 168 Miss. 834, 151 So. 724, 725 [1934], the Supreme Court of Mississippi explained its position in the Bacot case by saying: "In Bacot v. Phoenix Ins. Co., 96 Miss. 223, 50 So. 729, 25 [1909] L.R.A.,N.S., 1226, Ann.Cas. 1912B, 262, it was held that the mortgage clause of the statute above referred to has the effect of making an independent contract in favor of the mortgagee. In other words, the effect is to issue two policies, *1316 one to the mortgagor [here Parker] for the difference between the mortgage debt and the amount of the policy and the other in favor of the mortgagee [here Oak Tree] to the extent of his debt." [Emphasis in original]
In Weems I, 450 So.2d at 436 we opined: Under such a clause, the mortgagee is entitled to the proceeds of the policy and his right to recover will not be invalidated by the act or negligence of the mortgagor of the insured's property. No act or default of any person other than the mortgagee affect the right of the mortgagee to recover in case of loss. Hartford Fire Insurance Company v. Associates Capital Corporation, 313 So.2d 404, 407 (Miss. 1975). [emphasis supplied]
See also Talman Federal Savings and Loan Association v. American States Insurance Company, 468 So.2d 868, 872 (Miss. 1985).
Moreover, by virtue of Miss. Code Ann. § 83-13-7 (1991), mortgagees are protected in order of priority. That statute reads as follows:
When, by an agreement with the assured or by the terms of a fire insurance policy taken out by a mortgagor, the whole or any part of the loss thereon is payable to the mortgagee or mortgagees of the property for their benefit, the company shall, upon satisfactory proof of the rights and title of the parties, in accordance with such terms and agreement, pay all mortgagees protected by such policy in the order of their priority of claim, as their claims shall appear, not beyond the amount of which the company is liable. Such payments shall be, to the extent thereof, payments and satisfaction of the liabilities of the company under such policy. [emphasis added]
"The general rule of law in insurance cases is that, under a simple `loss-payable' or `open-mortgage clause' in an insurance policy payable to the mortgagee `as his interest may appear,' the mortgagee is only entitled to receive the amount due him on his mortgage out of the funds recovered by or due to the insured." * * * "On the other hand, where the `union' or `standard mortgage clause' is included in an insurance policy, the mortgagee is entitled to the proceeds of the policy, and the mortgagee's right to recover will not be invalidated by the act or negligence of the mortgagor of the insured's property." Hartford, 313 So.2d at 407. See also Nationwide Mutual Fire Insurance Company v. Dungan, 634 F. Supp. 674, 683-84 (S.D.Miss. 1986), affirmed 818 F.2d 1239 (5th Cir.1987).
It is clear from our decisions that the phrase "as its interest may appear" refers to the amount of debt owed to the mortgagee secured by the mortgage or deed of trust. Weems v. American Security Insurance Company, 486 So.2d 1222, 1228 (Miss. 1986) (Weems II), quoting from Couch On Insurance 2d. (Rev. ed.) § 42:696.
"That is, a clause `as his interest may appear' has reference to debts, the phrase `as his interest may appear' meaning merely that the insurer will pay the mortgagee to the extent to which his mortgage is a lien or charge on the premises."
Id. at 1229.
In the case sub judice, it really makes no difference whether the lienholder clause inserted into the present policy is a simple "loss-payable" clause, in which case the mortgagee is entitled to receive the amount due on his mortgage, or the "standard mortgage clause," in which case the mortgagee is entitled to the proceeds of the policy. This is because the outstanding balance on the mortgage with Oak Tree was greater than the amount of the insurance proceeds. Consequently, Oak Tree was entitled to the $10,000.
The statutes and case law in Mississippi make reasonably clear that Oak Tree, as loss payee, was entitled to payment of the insurance proceeds to the extent of its mortgage debt. Since the outstanding mortgage was greater than the proceeds, Oak Tree was entitled to the $10,000 to the exclusion of any monetary interest claimed by Necaise as a result of his contingency fee.
During trial, Necaise freely acknowledged that if Parker did not have any interest in the recovery, Parker could not assign anything to Necaise. Necaise further testified *1317 that he had no contractual relationship with Oak Tree and was fully aware there was a mortgage on Parker's mobile home. Although Necaise was never retained by Oak Tree and while no attorney-client relationship existed between the two, Necaise asserted: "I felt like that I was representing Oak Tree because I got them some money that they had not been able to get at this point." Oak Tree insisted that Necaise never represented their company.
In the final analysis, Parker assigned Necaise an interest in insurance proceeds which Parker didn't have. The law is clear that an assignee, i.e., Necaise, can receive no greater right in the thing assigned than a right equal to that of the assignor, i.e., Parker. Ford v. White, 495 So.2d 494, 497 (Miss. 1986); Indiana Lumbermen's Mutual Insurance Company v. Curtis Mathes Manufacturing Company, 456 So.2d 750, 754 (Miss. 1984). Here Parker had no interest in the insurance proceeds because the balance of his mortgage was greater than the proceeds.
Oak Tree did not have a contractual relationship with Necaise. This fact was conceded by Necaise. Under Mississippi law, the court has no authority to create a contract where none exists. Cf. First National Bank of Vicksburg v. Caruthers, 443 So.2d 861, 865 (Miss. 1983).
CONCLUSION
Necaise entered into an oral contingency fee contract with Parker who had executed a security agreement with Oak Tree upon the purchase of a mobile home. Parker was obligated to purchase fire and casualty insurance and named Dixie in a lienholder clause endorsement as loss payee. This entitled Oak Tree to payment of the insurance proceeds up to the amount of the outstanding lien on the mobile home. The outstanding balance on the mortgage with Oak Tree was greater than the amount of the insurance proceeds. It must follow accordingly that Oak Tree was entitled to the $10,000 to the exclusion on any monetary interest claimed by Necaise as a result of his contingency fee arrangement with Parker. Clearly, Necaise is entitled to an attorney's fee from his client Parker. But, Necaise was never retained by Oak Tree. There was no contractual relationship between Oak Tree and Necaise. Parker assigned Necaise an interest in insurance proceeds which Parker never had, because the balance of his mortgage was greater than the proceeds. The circuit judge correctly reversed the county court's award of attorneys fees to Necaise.
We affirm.
JUDGMENT AFFIRMED.
HAWKINS, C.J., PRATHER, P.J., and SULLIVAN, PITTMAN, BANKS and JAMES L. ROBERTS, Jr., JJ., concur.
McRAE, J., dissents with separate written opinion joined by DAN M. LEE, P.J.
McRAE, Justice, dissenting:
This case involves the question of whether the mortgagee, who is listed on a contract of insurance as having an interest in the said property and has standing to bring suit, takes priority over the reasonable fees of the attorney who took the necessary legal measures in collecting the insurance proceeds. Richard Parker, the insured, clearly had standing to sue Liberty National Fire Insurance Company (hereinafter "Liberty"), and Oak Tree Savings Bank (hereinafter "Oak Tree"), the mortgagee, could have also filed suit against Liberty to recover the proceeds due to them as named mortgagee pursuant to Miss. Code Ann. § 83-13-9 (Supp. 1991). Parker, unlike Oak Tree, proceeded to pursue his rightful recovery from Liberty through the assistance of his attorney, Albert Necaise. I do not dispute that Oak Tree did have a contract of insurance with Liberty according to Weems v. American Security Insurance Company, 450 So.2d 431, 436 (Miss. 1984); however, this contract in no way is over and above or takes precedent over Parker's contract of insurance and because Albert Necaise diligently collected Parker's insurance proceeds, he should be entitled to the agreed upon attorney's fees that were reasonable. Oak Tree benefited from Mr. Necaise's services at no cost, and the common-fund theory that has been employed by the United States Supreme Court ought to *1318 be utilized in this Court. I, accordingly, dissent.
Albert Necaise does not contend that he represented Oak Tree. Rather he notes that Oak Tree profited from his representation of Richard Parker, the true property owner, and had Oak Tree chosen to bring a recovery suit, it would have too incurred attorneys' fees. The common-fund doctrine, utilized and upheld by the United States Supreme Court, is applicable to the case at hand. The Supreme Court has stated:
Since the decisions in Trustees v. Greenough, 105 U.S. 527 [26 L.Ed. 1157] (1882), and Central Railroad & Banking Co. v. Pettus, 113 U.S. 116 [5 S.Ct. 387, 28 L.Ed. 915] (1885), this Court has recognized consistently that a litigant or a 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. See Mills v. Electric Auto-Lite Co., 396 U.S. 375 [90 S.Ct. 616, 24 L.Ed.2d 593] (1970); Sprague v. Ticonic National Bank, 307 U.S. 161 [59 S.Ct. 777, 83 L.Ed. 1184] (1939); cf. Hall v. Cole, 412 U.S. 1 [93 S.Ct. 1943, 36 L.Ed.2d 702] (1973). The common-fund doctrine reflects the traditional practice in courts of equity, ... and it stands as a well-recognized exception to the general principle that requires every litigant to bear his own attorney's fees, Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. [240] at 257-258 [95 S.Ct. 1612, 1621-22, 44 L.Ed.2d 141] (1975). The doctrine rests on the perception that persons who obtain the benefit of a lawsuit without contributing to its cost are unjustly enriched at the successful litigant's expense ... Jurisdiction over inequity by assessing attorney's fees against the entire fund, thus spreading fees proportionately among those benefited by the suit.
Boeing Co. v. Van Gemert, 444 U.S. 472, 478, 100 S.Ct. 745, 749, 62 L.Ed.2d 676 (1980). See Fleischmann Corp. v. Maier Brewing Co., 386 U.S. 714, 718-19, 87 S.Ct. 1404, 1407, 18 L.Ed.2d 475 (1967).
As with the case at hand, the facts of the above cases involved situations where more than one claimant had standing to sue. The Court ruled that attorneys' fees were to be charged against all who benefited from the services of the retained attorneys. This included those claimants who did not hire an attorney. The exact fairness ought to be applied in the case sub judice.
An apt analogy can be made to the area of workers' compensation law. In U.S. Fire Insurance Company v. Hill, 209 So.2d 440 (Miss. 1968), Roger Dale Hill was injured in the course of his employment by a Newton County school bus. Hill received workers' compensation benefits from his employer's insurance carrier, U.S. Fire Insurance Company. Hill, 209 So.2d at 441. A third party action was commenced against Newton County, Mississippi. Id. The trial court found Newton County to have been negligent and ordered that a judgment be entered against it in the amount of $145,000.00. Id. The statute which provided for third party actions read:
[A]ny amount recovered by the injured employee ... from a third party shall be applied as follows: Reasonable costs of collection as approved and allowed by the court in which such action is pending, or by the commission of this state in case of settlement without suit, shall be deducted; the remainder, or so much thereof as is necessary, shall be used to discharge the legal liability of the employer or insurer, and any excess shall belong to the injured employee or his dependents.
Miss. Code Ann. § 6998-36 (1942). Under this provision, this Court held that attorneys' fees were included in determining the "reasonable costs of collection." Hill, 209 So.2d at 442. Therefore, before the insurer or the employee could recover their rightful amounts, the attorneys' fees were paid. See Powe v. Jackson, 236 Miss. 11, 109 So.2d 546 (1959); Richardson v. United States Fidelity & Guaranty Company, 233 Miss. 375, 102 So.2d 368 (1958).
There is no Mississippi authority which provides that the mortgagee takes priority over an attorney who took the appropriate action of collecting for his client, the mortgagor. Oak Tree would not be entitled to the insurance proceeds had it not been for the insured, Richard Parker, taking the appropriate *1319 action to recover the proceeds. All too often, the mortgagee, knowing that he is entitled to the entire amount of insurance proceeds, sits on his rights and waits for the insured, who is in control of the property, to reach, through the aid of an attorney, the insurance proceeds. With the rendering of the majority's decision, Oak Tree and other mortgagees, in effect, are able to profit and reap all the benefits of the insurance at no cost because had Oak Tree brought suit to recover the proceeds, it would have had to seek the aid of an attorney. I doubt if any mortgagee will ever bring a recovery suit since the most economical procedure would be to wait until the insured brings suit. The only practical and feasible method in disbursing the proceeds would be analogous to the aforementioned cases with this Court holding that an attorney's fee is a cost of litigation which comes off the top of the recovery before the mortgagee recovers on his existing lien. With the majority's holding today, woe unto the attorney who wishes to represent an insured who has a standard mortgage clause included in a mortgage. How is such an insured to collect? No astute attorney would represent one such as Parker because there is no chance to be rightfully paid for his or her services rendered.
This in no way prevents Oak Tree from recovering its entire interest. Oak Tree is still entitled by law to proceed against the insured, Richard Parker, for any amount remaining due under the mortgage. The Harrison County Court reached the only just and equitable resolution. The circuit court's reversal and this Court's affirmance of the reversal is in error. Accordingly, I dissent.
DAN M. LEE, P.J., joins this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603744/ | 354 N.W.2d 239 (1984)
STATE of Iowa, Appellee,
v.
Jack Leroy LOSEE, Jr., Appellant.
No. 83-623.
Supreme Court of Iowa.
August 22, 1984.
*240 Charles L. Harrington, Appellate Defender, and Raymond E. Rogers, Asst. Appellate Defender, Des Moines, for appellant.
Thomas J. Miller, Atty. Gen., Marcia Mason, Asst. Atty. Gen., and James Smith, Asst. County Atty., for appellee.
Considered by REYNOLDSON, C.J., and UHLENHOPP, HARRIS, LARSON and SCHULTZ, JJ.
SCHULTZ, Justice.
Defendant, Jack Leroy Losee, Jr., appeals from his conviction and sentence on two counts of first degree murder in violation of Iowa Code sections 707.1.2. Defendant contends: (1) the trial court infringed his constitutional right of confrontation by refusing to allow defendant to impeach the State's primary witness with evidence of the results of a polygraph examination; (2) the trial court erred by requiring the jury to determine whether the prosecution's star witness was an accomplice rather than deciding the issue as a matter of law; and (3) he received ineffective assistance of counsel. We do not agree with defendant's contentions and affirm the trial court.
Defendant was convicted of killing Edwin Rains and Betty Thompson, both residents of Des Moines. Rains and Thompson shared an apartment with another woman who apparently moved out on the evening before the murders occurred. These three individuals worked for a local janitorial service. Defendant also was employed briefly by this firm; Rains was his immediate supervisor.
The execution-style murders allegedly occurred in the early morning hours of March 30, 1982. Thompson's body was discovered at 4:15 a.m. on March 30 in the middle of a road in southeast Des Moines. She died from a single gunshot wound to the head. Rains' body was not discovered until his car was recovered from the Des Moines river on July 26, 1982. He too died from gunshot wounds to the head and back.
Little physical evidence connected defendant to the crimes. Although both victims were shot with .38 caliber bullets and the markings on each bullet were similar, the ballistics expert was unable to determine whether the bullets had been fired from the same gun. Additionally, the murder weapon was never recovered, and two guns owned by defendant definitely were excluded as the instrument of death. A set of tire tracks at the scene of Thompson's murder did not match the tire tracks of the car defendant allegedly was driving on the night of Thompson's death, and the wheel base of the tracks did not match the wheel base of defendant's car. Contra, no direct evidence indicated that these tire tracks originated before or after Thompson's *241 death or were in any way associated with it.
Defendant's connection to the murders rested on the testimony of three witnesses who were granted immunity from prosecution for testifying. Two witnesses, Jack Whitney and Dawn Fetters, testified against defendant for the dismissal of unrelated charges. Both testified that defendant told them he had killed Rains and Thompson. The State's star witness was a fifteen-year-old boy, Billy Rickabaugh, who claimed to have been present at both murders. Billy testified he was present when Losee shot Rains and pushed his car in the Des Moines River. He was also present when Losee returned to the victims' apartment, escorted Betty Thompson into his car, and subsequently shot her on a lonely road in southeast Des Moines.
The only evidence defendant could produce refuting Rickabaugh's version was the testimony of the taxi driver who allegedly picked up defendant and the boy in downtown Des Moines where they had walked after dumping Rains' car in the river and drove them back to the area of the victims' apartment. The taxi driver admitted picking up two individuals on the morning of the murder, but claimed he did not recognize one of them as the defendant, whom he had known for several years. Conversely, he acknowledged that he was not certain the individual in the backseat of his cab had not been defendant.
I. Right to confront witnesses. Defendant urges that the trial court committed error when it refused to permit defendant to impeach a State's witness by presenting evidence that the State had administered a polygraph test to the witness. During the trial defense counsel informed the court out of the presence of the jury that he intended to call Michael Leeper, a police polygraph operator, to testify concerning the results of a polygraph test given to the fifteen-year-old witness, Billy Rickabaugh. Defendant's counsel made an offer of proof which indicated Leeper would testify that Rickabaugh's test results were inconclusive: the witness gave the same answer to certain repeated questions, but his reactions, as measured by the machine, were different. Over the State's objection the court allowed defendant to present the examiner as a witness, but prohibited mention of the polygraph test. The examiner testified that Rickabaugh attributed his difficulty in giving a complete statement to his drinking, smoking "pot" and using "acid." He further testified that Rickabaugh expressed uncertainty on some details and recalled Betty Thompson's death like a picture in his mindhaving heard, but not seen, the shooting.
The fourteenth amendment to the United States Constitution makes the confrontation clause of the sixth amendment applicable to the states. Pointer v. Texas, 380 U.S. 400, 406, 85 S.Ct. 1065, 1069, 13 L.Ed.2d 923, 928 (1965). Consequently, in a criminal case a state court defendant has a right to confront witnesses who testify against him with evidence that discredits their testimony. Espousing confrontation rights, Losee claims that the State chose to give its own witness a polygraph test, that witness did not pass the test, and the State nevertheless presented the witness to the jury. He maintains that fundamental fairness requires that the results of the test be placed before the jury.
Defendant urges this court to apply the ruling found in United States v. Hart, 344 F.Supp. 522 (E.D.N.Y.1971). The Hart court allowed the defendant to present evidence to show that the government's key witness had failed a polygraph test reasoning that the State must disclose all material exculpatory evidence to the defense and may not knowingly present false evidence. Id. at 523-24. We do not agree that Rickabaugh failed the polygraph test; the evidence shows that it was inconclusive. Not only is Hart distinguishable on its facts, but we also agree with another court that the decision concerning the admissibility of the polygraph test is "unpersuasive." United States v. Earley, 505 F.Supp. 117, 119-20 (S.D.Iowa 1981) (citing United States v. Alexander, 526 F.2d 161 (8th Cir. 1975)), aff'd, 657 F.2d 195 (8th Cir.1981).
*242 We also do not agree that fundamental fairness requires the admission of the witness' contradictory reactions to the polygraph test. The fact that the test results tend to be exculpatory does not remove the taint that renders such evidence inadmissible. We have consistently held that the results of a polygraph test may be admitted into evidence only by stipulation of the parties. State v. Marti, 290 N.W.2d 570, 586 (Iowa 1980); State v. Conner, 241 N.W.2d 447, 457 (Iowa 1976); see also Matter of Fairbanks, 287 N.W.2d 579, 582 (Iowa 1980). These holdings are premised on the ground that "[i]t has not been demonstrated that this field has been subjected to the standards, policing and discipline which are necessary in a science involving such pretentious and awesome subject matter." Conner, 241 N.W.2d at 459. A defendant's due process right to present evidence in a criminal action does not prevent the court from following evidentiary rules that are designed to assure both fairness and reliability in the ascertainment of guilt and innocence. Id. at 458 (quoting Chambers v. Mississippi, 410 U.S. 284, 302, 93 S.Ct. 1038, 1049, 35 L.Ed.2d 297, 313 (1973)). We have indicated in Conner that "[t]o sustain defendant's constitutional attack on the trial court's ruling excluding defendant's proffered polygraph evidence, it would be necessary for us to determine that the rule excluding unstipulated polygraph evidence does not rest on considerations of fairness and reliability." 241 N.W.2d at 458.
We continue to adhere to our rule allowing admission of polygraph evidence only by stipulation of the parties. The trial court did not err in excluding this evidence.
II. Accomplice instruction. In its jury instructions the trial court did not state that Rickabaugh was an accomplice as a matter of law. An instruction defined the term "accomplice" and informed the jury that the testimony of an accomplice must be corroborated pursuant to Iowa Rule of Criminal Procedure 20(3). Defendant makes no objection to the definition or the statement of law. He claims the jury should not have been allowed to determine the issue, but should have been instructed as a matter of law that Rickabaugh was an accomplice whose testimony required corroboration.
We defined accomplice in State v. Jennings, 195 N.W.2d 351, 356-57 (Iowa 1972):
An accomplice is a person who willfully unites in, or is in some way concerned in the commission of a crime. The general rule for determining whether a witness is an accomplice is if he could be charged with and convicted of the specific offense for which an accused is on trial.
But something more than mere knowledge that a crime is contemplated, or mere personal presence at the time and place where committed, must be shown in order to make one an accomplice. And it must be established by a preponderance of the evidence that a witness was in fact an accomplice.
(citations omitted). When the facts concerning a witness' culpability are not disputed or susceptible of different inferences, the court must decide whether the witness is an accomplice as a matter of law; when these facts are disputed or susceptible of different inferences, the jury must decide this as a question of fact. State v. Sallis, 238 N.W.2d 799, 802 (Iowa 1976).
Defendant claims the trial court twice indicated that Rickabaugh was an accomplice. He points to statements of the court on the record as follows: "It certainly stretches reason beyond the breaking point to suggest that Mr. Rickabaugh is absolutely not an accomplice," and "it would be a fine line to consider Mr. Rickabaugh not to be an accomplice." The State points out that the first statement was made while considering defendant's motion for directed verdict. The court further indicated that it did not have to decide the issue of whether or not Rickabaugh was an accomplice for the final determination of the motion because the testimony of Fetters and Whitney corroborated Rickabaugh's testimony. Finally, the State urges that the court did *243 not say in either statement that Rickabaugh definitely was an accomplice.
These statements fall short of a determination that the witness was an accomplice as a matter of law. At most, the trial judge correctly changed his mind and properly submitted the matter as an issue of fact to the jury after determining that his first impression was wrong. State v. Martin, 274 N.W.2d 348, 349 (Iowa 1979). At the time the matter was submitted to the jury, the trial court opined that this matter should be decided by the jury and overruled defendant's objection.
We hold the trial court was correct in submitting the accomplice issue to the jury for its determination. Rickabaugh's testimony indicated that he was guilty of nothing more than being an accessory after the fact. According to his version, he did not participate actively in either killing. He did not know that the killings were about to take place. Although he was a willing companion in the auto rides, he had accompanied Losee on several occasions previously. In the first killing he only helped defendant move the body into the back seat after the shooting and push the victim's car into the river. While he admitted he held the victim in the second killing, it was an attempt to calm her before defendant stopped the auto. The victim and defendant then got out of the car and walked away to the place of the murder. While there are implications that Rickabaugh was an accomplice, the jury could have accepted his version and determined to the contrary. Defendant's contention is without merit.
III. Ineffective assistance of counsel. Finally, defendant complains that he was deprived of his constitutional right to effective assistance of counsel. Defendant asserts that his attorneys presented inconsistent defensesdenial of involvement in the killings and diminished responsibility whose subtleties invited confusion, incredulity and conviction. In addition, he contended that damaging testimony was elicited from the expert psychologist during cross-examination.
To establish his claim of ineffective assistance of counsel, defendant must show: (1) that counsel's performance was so deficient that counsel was not functioning as the "counsel" guaranteed by the sixth amendment, and (2) that the deficient performance so prejudiced the defense as to deprive the defendant of a fair trial. Strickland v. Washington, ___ U.S. ___, ___, 104 S.Ct. 2052, 2064, 80 L.Ed.2d 674, 693 (1984).
Under our de novo review, counsel's performance must fall within the range of normal competency. Sallis v. Rhoads, 325 N.W.2d 121, 122 (Iowa 1982). It is incumbent upon the defendant to establish a factual basis to demonstrate counsel's inadequate representation. Id. We ordinarily do not find an adequate basis for relief when the claim of ineffectiveness concerns an attorney's decision regarding strategy or tactics. State v. Wilkens, 346 N.W.2d 16, 18 (Iowa 1984). When counsel makes a reasonable decision concerning strategy, we will not interfere simply because the chosen strategy is unsuccessful. Id. In summary, "[t]he benchmark for judging any claim of ineffectiveness must be whether counsel's conduct so undermined the proper functioning of the adversarial process that the trial cannot be relied on as having produced a just result." Strickland, ___ U.S. at ___, 104 S.Ct. at 2064, 80 L.Ed.2d at 692-93.
A clinical psychologist who examined defendant in 1978 was called as a defense witness. He testified that in 1978 defendant was suffering from a personality disorder and that superimposed on top of the personality disorder was the probability of having intermittent, recurrent disassociative states. The psychologist explained that an individual who was in a disassociative state when he committed an offense either would not remember the event or would have a grossly distorted recollection, yet his behavior would appear fairly normal to the casual onlooker. He then opined on direct examination that there was a possibility defendant could have been in *244 such a state in 1982. Defendant's counsel successfully obtained a jury instruction on "diminished capacity." Defendant later took the stand in his own defense and denied that he committed the killings. In final argument, defense counsel argued to the jury that defendant did not commit the killings, but assuming he did, he was suffering from a diminished capacity. Defendant claims that his trial counsel was ineffective because of the presentation of inconsistent defenses.
We find no merit in this claim. The psychologist testified about the possible memory lapse or distorted memory. Thus, raising this condition as a defense would not necessarily contradict defendant's denial that he committed the killings. Even assuming the defenses were inconsistent, the decision to advance two different theories of non-culpability is a trial tactic or strategy. It is obvious that defendant's lawyers, who are experienced criminal trial lawyers, were presenting any and all possible defenses. Whether the strategy was good or bad, it was a tactic that is not so unreasonable that it shows ineffectiveness. We keep in mind the admonition of the Supreme Court in Strickland that "the court should recognize that counsel is strongly presumed to have rendered adequate assistance and made all significant decisions in the exercise of reasonable professional judgment." ___ U.S. at ___, 104 S.Ct. at 2066, 80 L.Ed.2d at 695.
Defendant asserts that testimony elicited on cross-examination from the expert who was presented to establish the diminished responsibility defense was so damaging that it "doomed" the defendant and took this decision beyond the scope of trial strategy. Cross-examination of the psychologist revealed his clinical notes from a previous examination of the defendant showing a profile gained from a test which indicates an extremely psychiatrically disturbed and aggressive individual associated with "poorly-executed crimes that exhibit a great deal of savagery and homicidal intents." Cross-examination also revealed that the possibility that the defendant was in a disassociative state was "rather slim." While the expert gave unfavorable testimony on cross-examination, many witnesses have both favorable and unfavorable testimony to offer. As we recently stated:
After a certain course has proven unsuccessful, it is easy to say some other one should have been tried instead. This is unfair to counsel, who must make a choice between existing alternatives before the fact. We have refused to assume the role of Monday morning quarterback in condemning counsel's judgment in choosing between what are frequently equally hazardous options available to him.
State v. Wilkens, 346 N.W.2d 16, 19 (Iowa 1984) (emphasis in original) (quoting State v. Newman, 326 N.W.2d 788, 795 (Iowa 1982)).
We must examine this evidence, gleaned by an astute prosecutor on cross-examination, under the totality of the circumstances. Wilkens, 346 N.W.2d at 18; Sallis v. Rhoads, 325 N.W.2d 121, 122 (Iowa 1982). The State had presented a vivid and detailed account of defendant's activities in committing two brutal killings through the testimony of a claimed eyewitness. Two persons testified that defendant had admitted to each that he was the killer. Although defense counsel made vigorous attempts to impeach the witnesses, their success was questionable. This twenty-four-year-old defendant's credibility would obviously be severely challenged by his two felony convictions, prior imprisonment, drug usage and dealings, possession of guns, lifestyle and bizarre appearance. A hearing before the court considering whether defendant would choose to testify reveals that defense counsel could not be certain that defendant would testify. Counsel undoubtedly were aware of the matters revealed in his testimony. While he denied the killings, he was less than positive concerning his presence with Billy Rickabaugh at the time Billy said the killing occurred, as indicated by his answer to that question: "[e]vidently not. Not to my *245 knowledge, no." This answer dovetails with the psychologist's testimony concerning the memory of a person in a disassociative state and supports the dual defense of denial and diminished capacity. Under the total circumstances of this case, including defendant's own uncertainty as demonstrated by this testimony, we cannot find that the defense attorneys' performance fell outside the wide range of normal professional competency.
Our review of the entire record shows that defendant's attorneys mounted a vigorous and able defense with normal decisions and strategy. We find that defendant has not met his burden of showing that his counsel were so ineffective they were not functioning as the "counsel" guaranteed by the sixth amendment. Additionally, we find that counsel's performance was not so deficient as to undermine the trial process and prevent a fair trial.
For the reasons stated, we affirm the judgments and sentences.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603956/ | 8 So.3d 358 (2009)
BERG
v.
CAPO.
No. SC08-2329.
Supreme Court of Florida.
April 8, 2009.
Decision without published opinion. Rev.denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603750/ | 645 So.2d 551 (1994)
In re forfeiture of the following described property: ONE 1993 DODGE INTREPID, VIN: 2B3ED56TPH503198 TEMP FL TAG: 1040143; and One Hundred Seventeen Dollars ($117.00) in U.S. Currency,
CITY OF TAMPA POLICE DEPARTMENT, Appellant,
v.
Samuel ACOSTA, Appellee.
No. 94-00146.
District Court of Appeal of Florida, Second District.
November 16, 1994.
Merribeth Holmes and Kirby Rainsberger, Asst. City Attys., Tampa, for appellant.
Thomas A. Smith, Tampa, for appellee.
THREADGILL, Judge.
The Tampa Police Department appeals a final judgment denying the forfeiture of a Dodge Intrepid used to drive to a location where the driver purchased $20 worth of crack cocaine. The trial court found that the forfeiture of the recently purchased $21,339.00 Dodge would constitute an excessive fine. We affirm.
The complaint for forfeiture alleged that the vehicle was used in violation of section 932.702, Florida Statutes (Supp. 1992), to purchase cocaine. The Supreme Court recently held that the Excessive Fines Clause of the Eighth Amendment applies to forfeitures which are used to exact punishment notwithstanding that the forfeitures are civil and remedial in purpose. See Austin v. United States, ___ U.S. ___, 113 S.Ct. 2801, 125 L.Ed.2d 488 (1993); Alexander v. United States, ___ U.S. ___, 113 S.Ct. 2766, 125 L.Ed.2d 441 (1993). The Court left to the lower courts the choice of criteria to be used in determining whether a forfeiture is excessive. Austin, ___ U.S. at ___, 113 S.Ct. at 2812.
We affirm the denial of forfeiture based on the trial court's conclusion that the forfeiture *552 would violate the Excessive Fines Clause of the Eighth Amendment. Although we do not necessarily agree with the reasoning of the trial court, we are satisfied that the trial court applied the multi-factor approach approved in Austin and considered some of the factors used by other courts in considering this issue.[1]
Affirmed.
FRANK, C.J., and CAMPBELL, J., concur.
NOTES
[1] See U.S. v. One Parcel of Real Property Located at 9638 Chicago Heights, St. Louis, Mo., 27 F.3d 327 (8th Cir.1994); U.S. v. One Single Family Residence Located at 18755 North Bay Road, Miami, 13 F.3d 1493, 1498 (11th Cir.1994); U.S. v. Real Property Located at 1215 Kelly Road, Bellingham, Washington, its Buildings, Appurtenances, Attachments, Improvements, and Easements, 860 F. Supp. 764 (W.D.Wash. 1994); U.S. v. Certain Real Property Located at 2408 Parliament, Sterling Heights, Macomb County, Michigan, Together With All of Its Fixtures, Improvements, and Appurtenances, 859 F. Supp. 1075 (E.D.Mich. 1994); U.S. v. One Parcel Property Located at 427 and 429 Hall Street, Montgomery, Montgomery County, Ala., 853 F. Supp. 1389 (M.D.Ala. 1994); U.S. v. Certain Real Property Located at 11869 Westshore Drive, Putnam Tp., Livingston County, Mich., 848 F. Supp. 107 (E.D.Mich. 1994); U.S. v. Real Property Located at 6625 Zumirez Drive, Malibu, Cal., 845 F. Supp. 725 (C.D.Cal. 1994); U.S. v. Real Property Known and Numbered as 429 South Main Street, New Lexington, Ohio, 843 F. Supp. 337 (S.D.Ohio 1993). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603755/ | 645 So.2d 156 (1994)
Sean H. HOWARD, Appellant,
v.
STATE of Florida, Appellee.
No. 94-0467.
District Court of Appeal of Florida, Fourth District.
November 23, 1994.
Richard L. Jorandby, Public Defender, and Karen E. Ehrlich, Asst. Public Defender, West Palm Beach, for appellant.
Robert A. Butterworth, Atty. Gen., Tallahassee, and Don M. Rogers, Asst. Atty. Gen., West Palm Beach, for appellee.
PARIENTE, Judge.
Defendant entered a plea of no contest to possession with intent to sell cocaine reserving his right to appeal from the denial of his motion to suppress. The sole issue on appeal is whether the police officers' seizure of cocaine *157 rocks contained in a 35 millimeter film canister concealed in defendant's waistband resulted from an illegal search. Because the police officers exceeded the scope of the consensual search for weapons and did not have probable cause to believe that the film canister contained illegal contraband, we reverse the trial court's order denying the motion to suppress physical evidence and statements.
On July 4, 1993, police stopped a vehicle, in which defendant Howard was a passenger, under the suspicion that the vehicle may have been stolen. Defendant does not challenge the validity of the stop. Although suspicion that the vehicle had been stolen was shortly dispelled, the officers learned that the driver's license of the driver was invalid. While one officer completed the paperwork regarding the driver's license violation, another officer searched the vehicle.[1] A third officer, Officer Majorossy, asked defendant, who was standing outside the vehicle during the search, if he had any weapons on him. Defendant responded that he did not. Although neither defendant nor the driver was suspected of any criminal activity at the time, Officer Majorossy asked defendant if he could search him for weapons. Defendant acquiesced. Officer Majorossy could not have searched defendant absent consent.
In the course of the weapons pat-down, Officer Majorossy felt a small plastic canister under defendant's waistband which he identified by touch as a 35 millimeter film canister. While the canister was still on defendant's person, the officer shook it and heard what sounded like "pebbles falling inside it." Officer Majorossy, who had no actual prior experience identifying crack cocaine, testified that he had a hunch or suspicion that the canister contained cocaine rocks. Officer Majorossy called to Officer Seaber, who testified that Officer Majorossy told him: "Paul, I think I have something," "I think I have drugs," "I think it's a small bottle." Officer Majorossy then shook the canister again and Officer Seaber heard what sounded like "small pebbles in a small plastic bottle." When asked what that meant to him, Officer Seaber stated, "I thought it would possibly be cocaine rock rocks."
The scope of the search was circumscribed by defendant's voluntary consent to a weapons search. Neither officer believed the canister was a weapon nor had probable cause to believe that defendant was armed. The trial court found defendant's consent to be voluntary. The "consent" occurred during one officer's search of the vehicle and while the traffic ticket for the driver's license was being written; thus, defendant was not being illegally detained, even though he was not told he was free to go.[2]
Although we do not have reason to disturb the trial court's finding that the consent was voluntary, we hold that the officers' search impermissibly exceeded the scope of the consent *158 defendant had given. Police officers, conducting a weapons search, must use caution not to exceed the scope reasonably necessary to ensure that the individual has no weapons. Justice Anstead, writing for our court, cautioned against police officers going "too far" in identifying otherwise harmless canisters as contraband. In Interest of P.L.R., 435 So.2d 850 (Fla. 4th DCA 1983), aff'd sub nom. P.L.R. v. State, 455 So.2d 363 (Fla. 1984). Probable cause provides the check on this authority. Id.
The Florida Supreme Court has specifically cautioned against using a permissible search for weapons as a springboard for a search for other items:
Perhaps the unspoken reason for limiting searches and seizures to objects thought to be weapons is that any other rule would have the practical effect of allowing law enforcement officers to search for contraband with less than probable cause on the ostensible premise of looking for weapons.
Doctor v. State, 596 So.2d 442, 444 (Fla. 1992), citing with approval, Dunn v. State, 382 So.2d 727, 729 (Fla. 2d DCA 1980). Both sides cite Doctor in support of their respective positions.
In Doctor, the supreme court held that during a limited frisk for weapons, police may only seize weapons or objects which reasonably could be weapons, despite the fact that the officer may reasonably suspect that the object might be evidence of a crime. Therefore, reasonable suspicion that the object may be cocaine does not justify a seizure of the object probable cause that the object to be seized is illegal contraband must exist:
Whether a police officer has sufficient probable cause to believe that a suspect is carrying illegal contraband will depend on the totality of the circumstances. P.L.R. v. State, 455 So.2d 363 (Fla. 1984), cert. denied, 469 U.S. 1220, 105 S.Ct. 1206, 84 L.Ed.2d 349 (1985). Relevant to the inquiry is the officer's specific experience with respect to the particular narcotic. See Cross v. State, 560 So.2d 228 (Fla. 1990).
Doctor, 596 So.2d at 445. In further elaborating on the requirement of probable cause, the supreme court cautioned that:
We do not suggest that probable cause arises anytime an officer feels an object that he reasonably suspects to be contraband. Not all concealed objects in a person's possession are contraband. Thus, merely seeing or feeling an unknown object does not suffice to show probable cause.
Id.
In Doctor, the officer felt a bulge in the groin area which he immediately believed to be cocaine. The officer had extensive prior experience with identifying drugs and drug trafficking, having made 250 drug arrests and having seen or felt crack cocaine over 800 times. He had testified that during the course of 130 search warrant arrests, he discovered cocaine in the groin area 70 times. The court noted that the officer gave specific statistics evidencing his significant experience with that particular aspect of drug trafficking.
In contrast, in this case Officer Majorossy, upon feeling the object, knew that it was a film canister and not a weapon. He had no probable cause at that point to believe that the canister contained contraband. Certainly film canisters are not exclusively used as containers for cocaine rock, although according to what the officers had learned from a training course on narcotics identification, some dealers carry cocaine in plastic bottles, pill bottles and plastic baggies.
Both officers possessed limited narcotics-related law enforcement experience. Officer Majorossy had no actual experience with cocaine; his only knowledge was gained as part of a 40 hour training course at the Reserve Academy. While he was a full-time correctional officer, Officer Majorossy was also serving as a reserve officer for the Stuart Police Department for about one year and a half. Officer Seaber, who had been with the police department two years and had no previous law enforcement experience, offered non-specific testimony about 18-20 prior undercover purchases, without explaining how those experiences specifically related to the circumstances of defendant's case.
It was not until the officers shook the canister that they began to develop further *159 grounds to suspect that the canister contained illegal contraband. The state urges us to find that the results obtained by shaking the canister fell within the "plain feel" exception to the warrant requirement of the Fourth Amendment enunciated by the United States Supreme Court in Minnesota v. Dickerson, ___ U.S. ___, 113 S.Ct. 2130, 124 L.Ed.2d 334 (1993). In Dickerson, the Supreme Court described the "plain feel" exception as analogous to the "plain view" exception:
If a police officer lawfully pats down a suspect's outer clothing and feels an object whose contour or mass makes its identity immediately apparent, there has been no invasion of the suspect's privacy beyond that already authorized by the officer's search for weapons; if the object is contraband, its warrantless seizure would be justified by the same practical considerations that inhere in the plain view context. (Emphasis supplied)
___ U.S. at ___, 113 S.Ct. at 2137, 124 L.Ed.2d at 346. In recognizing the "plain feel" exception, the Supreme Court stated that the police officer conducting the search, must immediately recognize the illegal character of the object from its texture or feel. The officer is not permitted to determine that the object is contraband by squeezing, sliding or otherwise manipulating the object, once it is clear that the object could not reasonably be a weapon. Id. at ___, 113 S.Ct. at 2138, 124 L.Ed.2d at 347. In this case, because the officer shook the canister, the cocaine rocks seized during the search for weapons were not admissible under the "plain feel" exception.
We therefore find that the officers exceeded the scope of their weapons search when they shook the canister, after they knew the film canister was not a weapon and when they did not otherwise have probable cause to believe that the object was illegal contraband. See Hamilton v. State, 612 So.2d 716 (Fla. 2d DCA 1993). The shaking of the canister was an impermissible search. See Smalls v. State, 581 So.2d 1003 (Fla. 2d DCA 1991).
Even if the officers were justified in shaking the film canister, the additional information obtained by hearing the sound of "pebbles" did not supply probable cause. Interpreting the officers' testimony in the light most favorable to the state, at that point they only had reasonable suspicion. There were no other circumstances prior to shaking the canister upon which the officers could have reasonably concluded that either defendant or the driver of the vehicle probably had been or were involved in criminal activity. In fact, both officers specifically testified they had no such suspicion.
The state points to the character of the neighborhood and time of day as providing an additional factor in evaluating probable cause. However, the lounge parking lot was not specifically identified as a place for drug dealing other than being in a high-crime area. Additionally, while Officer Majorossy, a reserve officer, testified that drug dealing in the neighborhood often takes place "all evening," to the contrary, Officer Seaber, who was employed with the police department and had been involved with undercover buys when first hired, said that drug sales were "pretty frequent during the day."
Defendant was an innocent passenger who had exited the vehicle as requested by the police and who, under intimidating circumstances, "consented" to a limited weapons search in a neighborhood generally considered to be a high-crime area. The discovery of the film canister in defendant's waistband by an officer inexperienced in narcotics investigation did not lead to an automatic conclusion that the canister contained illegal contraband. Under the totality of these circumstances, the officers' suspicions did not rise to the level of probable cause justifying a search of the film canister. We accordingly reverse the trial court's order denying defendant's motion to suppress.
REVERSED AND REMANDED.
DELL, C.J., and GLICKSTEIN, J., concur.
NOTES
[1] The legality of this search is not before us because the officers did not discover any illegal or suspicious objects during this search. The trial court found the search to be a legal Belton search. In New York v. Belton, 453 U.S. 454, 101 S.Ct. 2860, 69 L.Ed.2d 768 (1981), the Supreme Court held that when a police officer has made a lawful custodial arrest of the occupants of an automobile, the officer may, as a contemporaneous incident of that arrest, search the passenger compartment of the vehicle and may also examine the contents of any container therein. In the instant case, however, the search of the car was not incident to a custodial arrest of the occupants. Therefore, the search of the vehicle did not constitute a lawful Belton search. See generally Caplan v. State, 531 So.2d 88 (Fla. 1988).
[2] Where an officer, following a traffic stop, has no articulable evidence of criminal activity to justify the detention of a defendant after the purpose of the initial stop has been effected, the officer must release that defendant. See § 901.151 Fla. Stat. (1993). Any further detention of that defendant would be illegal and would render any search, even if consensual, illegal as well. Dunbar v. State, 592 So.2d 1230 (Fla. 5th DCA 1992).
In the instant case, however, while the initial purpose for the traffic stop, suspicion that the vehicle had been stolen, had been dissipated, the continued detention was justified by the discovery of the invalid driver's license. Courts have repeatedly held that temporary detention for a traffic violation is permitted, so long as the detention is no longer than necessary to write the traffic citation. Cresswell v. State, 564 So.2d 480 (Fla. 1990); State v. Anderson, 479 So.2d 816 (Fla. 4th DCA 1985); compare Dunbar, 592 So.2d at 1231 (detention was illegal where no citation was issued and officer testified that he was done with his business prior to detaining the defendant and making the search of defendant's vehicle). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603821/ | 882 F.Supp. 1409 (1995)
ETABLISSEMENT ASAMAR LTD., et ano., Plaintiffs,
v.
LONE EAGLE SHIPPING LTD., et al., Defendants.
No. 94 Civ. 7886 (LAK).
United States District Court, S.D. New York.
April 21, 1995.
*1410 John C. Stratakis, Poles, Tublin, Patestides & Stratakis, New York City, for plaintiffs.
Terry L. Stoltz, Kirstein P. Merone, Burlingham Underwood, New York City, for defendants.
MEMORANDUM OPINION
KAPLAN, District Judge.
This is an action to recover $95,762.67, which is the balance due for bunkers delivered to the M/V Alpha Star in 1993 in Amsterdam and Dunkirk. The delivery of the bunkers and the amount of the unpaid balance are undisputed. Defendants assert, however, that the parties entered into a binding agreement to settle the liability for $40,000 and that plaintiffs have reneged. The matter is before the Court on cross-motions for summary judgment.
Facts
The pertinent facts are simple and undisputed in all respects save one. In October and November 1993, plaintiff Establishment Asamar Ltd. ("Asamar") delivered bunkers to the M/V Alpha Star in Amsterdam and Dunkirk at a total price of $205,762.67, of which $95,762.67 remains unpaid. The vessel subsequently sustained severe hull damage by reason of heavy weather and/or peril of the sea and became a total loss. The vessel's owner, Lone Eagle Shipping Ltd. ("Lone Eagle") thereupon appointed Shipping and General Consultants, Ltd. ("S & G") to marshal its remaining unencumbered assets and to seek to negotiate settlements of all outstanding claims. It is these negotiations that give rise to the dispute in this case.
On June 17, 1994, S & G conveyed to plaintiff Asamar, Inc. the owner's offer to settle for 35% of the amount due (Stratakis Aff. Ex. 11), which was $33,516.93. On June 20, 1994, Asamar responded as follows:
"Although we appreciate your previous offer to settle by paying 35 pct of the amount due on the above bunker debt we feel it is still a little [sic] low. Especially after owners promised full payment on more than one previous occasion.
"We are willing to accept a flat amount of USD 40,000.00. If owners agree, please remit funds ..." (Id. Ex. 12)
It concluded with the phrase "please advise." (Id.)
There is no evidence of any response by the owner, at least prior to August. Defendants, however, have submitted an affirmation claiming that plaintiffs' principal, Mr. Pappaceno, stated in July or early August that he had agreed with S & G on a $40,000 settlement, but had been unable to obtain information as to when he would be paid. (Dushas Aff. ¶ 5) Mr. Pappaceno has submitted a supplemental affidavit denying Dushas' assertion and stating that he never reached any such agreement. (Pappaceno Aff. ¶ 9)
Whatever may have passed between Dushas and Pappaceno and between Pappaceno and S & G, plaintiffs' counsel prepared a letter to the Le Timon, one of the owner's agents, dated August 9, 1994, in which they demanded payment of the full $95,762.67 plus interest. (Economou Aff. Ex. 4) This letter appears to have been received by Le Timon on August 16, 1994. (Id.) It is undisputed that this letter was in the hands of Tom Dushas, one of the defendants, no later than August 18, 1994, and was received by S & G on August 19, 1994. (Id.)
S & G, for its part, sent a facsimile, dated August 17, 1994, to Asamar which stated:
"Further to our previous correspondence we are pleased to inform you that we expect to collect moneys due to the Owners of the [Alpha Star] towards the end of September.
"Assuming that everything goes well and the amounts are collected on time we shall be able to pay you in September upon collection." (Id. Ex. 3)
The August 17 fax does not indicate the amount that S & G hoped to pay "in September upon collection."
*1411 Discussion
Contentions of the Parties
Defendants argue that Asamar's June 20, 1994 fax, in which it indicated a willingness to accept $40,000, gave rise to a binding agreement to settle at that figure on the theory that the fax accepted the owner's prior offer to settle for 35% of the amount due. They appear to rely on the Dushas affirmation in support of their contention that plaintiffs construed the June 20 fax as concluding a deal. (See Def. Reply Mem. 8) Alternatively, they contend that the June 20, 1994 fax was a counteroffer by plaintiffs to settle for $40,000, which was accepted by S & G's August 17, 1994 fax. Curiously, defendants do not argue that a binding agreement was reached between Pappaceno and S & G, apart from the exchange of correspondence described above, as the Dushas affirmation might suggest. In addition, Lone Eagle contends that summary judgment may not be entered against it because it has pleaded the defense of lack of jurisdiction over its person, and plaintiffs have failed to make any showing to overcome that defense.
Plaintiffs argue that the June 20, 1994 fax could not have accepted the offer to settle for 35% because it varied materially from the terms of the offer. Moreover, they assert that the August 17, 1994 S & G fax gave rise to no binding agreement because (a) plaintiffs' prior offer to accept $40,000 has terminated by the August 9, 1994 letter in which their counsel demanded payment of the full amount and, in any case, (b) the August 17, 1994 fax was not an unequivocal and definite acceptance of the $40,000 offer.
The June 20, 1994 Fax
The June 20, 1994 fax did not give rise to a binding agreement to settle the controversy. It responded to the previous offer to settle for 35% of the amount owed, which amounts to $33,516.93. The indication of willingness to accept $40,000 in response to an offer of $33,516.63 was not an acceptance because it varied materially from the terms of the offer. It was a counteroffer and, in consequence, a rejection of the prior offer. E.g., Gram v. Mutual Life Insurance Co. of N.Y., 300 N.Y. 375, 382, 91 N.E.2d 307 (1950); Roer v. Cross County Medical Center Corp., 83 A.D.2d 861, 441 N.Y.S.2d 844 (2d Dept.1981); Greystone Partnerships Group, Inc., v. Koninklijke Luchtvaart Maatschappij N.V., 815 F.Supp. 745 (S.D.N.Y.1993); I E. ALLAN FARNSWORTH, FARNSWORTH ON CONTRACTS §§ 3.13, at 229, 3.21, at 258-59 (1990) (hereinafter FARNSWORTH).[1]
The August 17, 1994 Fax
The first question we must address in considering the effect of the August 17, 1994 fax is whether plaintiff's June 20, 1994 offer to settle for $40,000 was still in effect, putting aside for the moment the question whether it had been accepted earlier as Dushas' affirmation appears to claim.
Inasmuch as the June 20 offer did not specify a time for acceptance, it was open for a reasonable time unless sooner revoked. Kaelin v. Warner, 27 N.Y.2d 352, 356, 318 N.Y.S.2d 294, 296, 267 N.E.2d 86, 88 (1971); FARNSWORTH § 3.19, at 253-54. What is reasonable depends upon the circumstances, including the question whether continuation of the offer exposes the offeror to speculative risk and any course of dealing between the parties, and usually presents an issue of fact. E.g., Oliver v. Wells, 229 App.Div. 356, 243 N.Y.S. 328, 332 (3d Dept.), aff'd, 254 N.Y. 451, 173 N.E. 676 (1930); RESTATEMENT (SECOND) CONTRACTS § 41(2) and Comment b (1981). While this may be a case in which the historical facts permit only one conclusion as to reasonableness, I assume, rather than decide, that the June 20 offer was effective and capable of acceptance on August 17 unless sooner accepted or revoked.
The August 9 letter by plaintiffs' counsel was inconsistent with the offer to settle for $40,000 and therefore constituted a revocation of the June 20 offer unless that offer was accepted prior to the revocation becoming effective. A revocation of an offer *1412 sent by mail or electronic means is not effective until it is received. Stein-Gray Drug Co. v. H. Michelsen Co., 116 N.Y.S. 789 (Mun.Ct.1909); FARNSWORTH, supra § 3.17, at 249. Hence, assuming the August 17 fax was sufficient to accept the June 20 offer, it was effective only if it was sent before the August 9 revocation was received. The question, then, is when the August 9 letter was received.
The letter was addressed to Le Timon in care of Dover Agency & Brokerage, to the attention of Tom Dushas. As noted, defendants' copy bears an August 16, 1994 date stamp. Mr. Dushas then faxed that copy to Mr. Economou at S & G on August 18, 1994. In consequence, we conclude that the letter was received by Le Timon and Mr. Dushas on August 16, 1994 and by S & G on August 18, 1994.
Plaintiffs' June 20 offer to settle for $40,000 was made to S & G in its capacity as agent for the owner of the M/V Alpha Star, Lone Eagle. (See generally Economou Aff. ¶¶ 6, 8; Stratakis Aff. Exs. 9-12) Le Timon and Dover at all relevant times were Lone Eagle's agents. (Compare Am.Cpt. ¶¶ 4, 6 with Lone Eagle Ans. ¶¶ 4, 6) Hence, Dover's receipt of the August 9 letter demanding full payment constituted notice to Lone Eagle that the $40,000 offer was revoked and deprived Lone Eagle and its agents of the power of acceptance. E.g., Corporacion de Mercadeo Agricola v. Mellon Bank International, 608 F.2d 43, 46 (2d Cir.1979); Center v. Hampton Affiliates, Inc., 66 N.Y.2d 782, 784, 497 N.Y.S.2d 898, 899, 488 N.E.2d 828, 829 (1985). In consequence, even assuming that the June 20 offer did not lapse by passage of time, the receipt by Dushas and Le Timon of the August 9 letter demanding full payment revoked the offer. S & G's August 17 fax, even if otherwise a sufficient acceptance, was incapable of creating a contract because the offer no longer was outstanding.
We need not rest on this ground alone. The June 20 fax offered to settle for $40,000 and directed that the owners remit the funds if that amount were acceptable. The August 17 fax did not commit the owner to pay any amount unconditionally and did not specifically refer to the sum of $40,000. It was an expression of willingness to pay an unspecified sum of money in September if the owner was successful in collecting other funds.
An acceptance must be positive, unambiguous and contain no material variance from the terms of the offer. E.g., Strassburg v. Ricotta, 104 A.D.2d 723, 724, 480 N.Y.S.2d 649, 650 (4th Dept.1984); Roer v. Cross County Medical Center Corp., 83 A.D.2d 861, 441 N.Y.S.2d 844 (2d Dept.1981). The August 17 fax met none of these criteria. It was conditional upon other collections as to whether any payment would be forthcoming. It was ambiguous as to the amount. And it materially varied from the offer, which in June contemplated prompt payment, by suggesting possible payment at the end of September. In consequence, the August 17 fax was not a valid acceptance, even assuming there then was an offer capable of acceptance.
Oral Agreement
This leaves the question whether there was an oral agreement to settle the matter for $40,000 and, if so, whether proof of such an agreement is permissible under the Statute of Frauds or any comparable provision of Greek law. The parties agree that the Statute of Frauds and comparable provisions of Greek law do not apply here.[2] In consequence, in view of the fact that the Dushas affirmation and the Pappaceno affidavit are in direct conflict as to whether there was an oral agreement, summary judgment must be denied.
Accordingly, the cross-motions for summary judgment both are denied.
SO ORDERED.
NOTES
[1] We note that the parties have devoted a good deal of attention to whether this matter is governed by Greek or New York law and submitted affidavits as to the Greek law. They appear to agree, however, that there is no difference between Greek and New York law material to resolution of these motions. Accordingly, we apply New York law.
[2] Pl.Supp.Mem. at 3; Def.Supp.Mem. at 2-3. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603794/ | 8 So. 3d 15 (2009)
Elodie Christensen ZIIFLE
v.
BRAE ASSET FUND, L.P.
No. 08-CA-646.
Court of Appeal of Louisiana, Fifth Circuit.
January 13, 2009.
Wiley J. Beevers, Raylyn R. Beevers, Steven M. Materer, Michael F. Somoza, *16 Attorneys at Law, Gretna, LA, for Appellant, Elodie Christensen Ziifle.
Mark C. Landry, Attorney at Law, Metairie, LA, for Appellee, Brae Asset Fund, L.P.
Panel composed of Judges MARION F. EDWARDS, SUSAN M. CHEHARDY, and WALTER J. ROTHSCHILD.
SUSAN M. CHEHARDY, Judge.
In 1990, the Federal Deposit Insurance Company("F.D.I.C.") filed a lawsuit in federal court against Tim Tyler Ziifle, and his wife, Diane Reed Ziifle, to enforce payment of the debts, which they had personally guaranteed, for Silent Partner Body Armor, Inc. On March 19, 1991, Mr. and Mrs. Tim Ziifle entered into a consent judgment, in favor of F.D.I.C., for $227,820.00 with accrued interest of $36,616.53, plus subsequently accruing interest. That judgment was later assigned to Quantum Varde Asset Fund, L.L.P.("Quantum").
On February 25, 1993, the Ziifles granted a mortgage on their immovable property to secure a note, payable to bearer, on demand, in the principal amount of $90,000.00, with interest at the rate of 8% per annum. The mortgage was recorded on March 2, 1993, at MOB 3570, folio 240. The bearer of that note and holder of the mortgage is Elodie C. Ziifle, Mr. Ziifle's mother.
On February 16, 2001, Quantum filed suit in federal court to revive the consent judgment. On February 23, 2001, Quantum recorded a certified copy of the original consent judgment in the mortgage records of Jefferson Parish at MOB 3991, folio 145.
On March 3, 2001, Quantum recorded a Notice of Lis Pendens and Reinscription of Judgment in the mortgage records of Jefferson Parish at MOB 3992, folio 302. During the pendency of the revival litigation, on November 1, 2001, Quantum transferred the judgment to Brae Asset Fund. The final judgment reviving the consent judgment was rendered and recorded in the mortgage records of Jefferson Parish on October 25, 2002, at MOB 4089, folio 47.
On July 6, 2007, Ms. Ziifle brought this proceeding, as a rule to rank, claiming that the district court should rank her mortgage as superior to the judgment owned by Brae. Brae filed Exceptions of Improper Use of Summary Proceedings and Non-Joinder of Necessary Parties.
At the August 27, 2007 hearing, the parties agreed that the exceptions should be argued and decided before the trial on the merits. That day, the parties argued the exceptions. The trial court took the matter under advisement.
On November 12, 2007, the trial court issued judgment denying the exceptions and granting the rule to rank in favor of Brae Asset Fund. Mrs. Ziifle moved for a new trial, which was denied. Mrs. Ziifle, thereafter, perfected this devolutive appeal, seeking review of the original judgment, and the judgment denying the motion for a new trial. For the following reasons, we grant a new trial and remand for further proceedings.
Here, both parties concede that they did not argue or introduce evidence on the merits of Mrs. Ziifle's Rule to Rank at the August 27, 2007 hearing. As provided in La. C.C.P. art. 1972(1), a new trial shall be granted, upon contradictory motion, where the verdict or judgment is contrary to the law and evidence. Although the statutory language mandates the granting of a new trial if the trial court finds the verdict is contrary to the law and evidence, the jurisprudence interpreting this provision recognizes the trial judge's discretion in making that determination. *17 "Whether to grant a new trial requires a discretionary balancing of many factors." Davis v. Wal-Mart Stores, Inc., 00-0445 (La.11/28/00), 774 So. 2d 84 (citing Gibson v. Bossier City General Hospital, 594 So. 2d 1332 (La.App. 2 Cir.1991)).
An appellate court has the authority to determine whether a trial judge abused his discretion in not granting a new trial. Lamb v. Lamb, 430 So. 2d 51, 53 (La.1983); Garrett v. Universal Underwriters, 586 So. 2d 727 (La.App. 3rd Cir. 1991). See also La. C.C.P. art. 1971, comment (d)("Although the trial court has much discretion regarding applications for new trial, . . . the appellate court will not hesitate to set the trial court's ruling aside, or grant a new trial when timely applied for . . . in a case of manifest abuse").
In this case, Mrs. Ziifle argues that the denial of her motion for new trial improperly prohibited her from introducing evidence on the merits of the underlying matter. We agree. The transcript of the hearing on the exceptions reveals that both parties agreed that the exceptions had to be heard before the merits of the case, which was scheduled for trial at a later date. More importantly, neither party submitted argument or evidence regarding the underlying Rule to Rank. We cannot see a clearer case of the verdict being contrary to the evidence than when no evidence has been introduced on the merits of the claim. After reviewing the record, such as it is, we find that the appellant, Ms. Ziifle, has demonstrated that the trial judge's denial of her motion for new trial was an abuse of discretion, de la Vergne v. de Lamaze, (La.App. 4 Cir. 2/29/96), 670 So. 2d 599, 602-603.
Moreover, after conducting an independent review of the record, we conclude that the appellate record in this case should not have been supplemented with evidence that was never introduced in the trial court. Accordingly, we recall our order of August 28, 2008, as improvidently granted. That evidence that was added to the record shall be removed by order of this Court. In conclusion, we amend the appellate record, grant appellant's motion for new trial, and remand for further proceedings.
JUDGMENT REVERSED; NEW TRIAL GRANTED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604099/ | 645 So. 2d 297 (1992)
Ex parte K.S.G.
(In the Matter of M.K.G.)
2910264.
Court of Civil Appeals of Alabama.
May 22, 1992.
Certiorari Denied July 7, 1992.
*298 Don P. Bennett, Dothan, for petitioner.
William Prendergast and James E. Long, Asst. Attys. Gen., for respondent.
Alabama Supreme Court 1911389.
RUSSELL, Judge.
In April 1990 the mother filed a petition for divorce in the Circuit Court of Houston County. She was awarded pendente lite custody of the child; however, the court later ordered temporary custody to be placed with the father, with visitation rights for the mother.
On September 26, 1991, the mother filed a dependency petition in the Houston County Juvenile Court alleging that the child was in physical danger in the father's care and requesting immediate custody. The juvenile court issued a pickup order; however, because the child could not be located it was not executed immediately. On that same day, the father filed a motion in the circuit court claiming that the mother's allegations in the dependency petition were false and demanding relief from the pickup order. The circuit court issued an order on October 2 containing the following provision, in pertinent part:
"The Houston County Department of Human Resources will do a home evaluation of both parties to this case.... Pending further orders of this Court, the Department *299 will not take custody of [the child] or take any steps to place him in foster care."
Despite the circuit court's edict, the juvenile court executed the DHR pickup order on October 4, when the child was visiting the mother. The child was subsequently placed in temporary foster care by DHR, pending a 72-hour hearing on the mother's petition for dependency. After this proceeding was held, the juvenile court issued an order finding the child to be dependent and transferring legal custody to DHR. The father then filed a petition in the circuit court for relief from the juvenile court's judgment. The circuit court issued an order requiring DHR to return the child to the father immediately and to appear before the circuit court to show cause for its willful disregard of the October 2 order.
A hearing was held before the circuit court two days later, with DHR present. The court ordered the child to be placed in the paternal grandparents' home, where the father also resides. DHR consented to this disposition.
In January 1992 a final hearing was held on the dependency petition that had remained pending in the juvenile court. DHR reported that the father was not a threat to the child and recommended that the child remain in the custody of his paternal grandparents. However, the juvenile court entered the following judgment:
"Said child is adjudicated to be dependent in that (1) his custody is in controversy; (2) said child is in such condition or surroundings or is under such improper or insufficient guardianship or control as to endanger his morals, health or general welfare; and (3) for any other cause is in need of the care and protection of the state. These findings are based in part on both parents' admissions of alcohol and/or drug abuse."
On February 26, 1992, the circuit court rendered a final decree in the parties' divorce action. The decree ratified an agreement of the parties, filed the day before the proceeding, which provided that the parents would share joint custody of the child with the father retaining primary physical custody. The father then filed a petition for writ of mandamus and a writ of prohibition, seeking to vacate the juvenile court's judgment of dependency and to prevent further adjudication of custody by the juvenile court.
Mandamus and prohibition are extraordinary remedies and will not issue unless there is no other adequate remedy. Ex parte Strickland, 401 So. 2d 33 (Ala.1981). Mandamus is proper where there is a clear specific legal right shown for enforcement of which there is no other adequate remedy. Id. Prohibition is proper for the prevention of a usurpation or abuse of power where a court undertakes to act in a manner in which it does not properly have jurisdiction. Id.
The father argues that the juvenile court lacked jurisdiction to make a disposition of custody when the circuit court had already assumed jurisdiction over the issue. He concludes that the juvenile court's judgment should be vacated and the court prevented from further action concerning the mother's dependency petition. We agree.
By statute, the juvenile court has exclusive original jurisdiction in proceedings in which a child is alleged to be dependent, § 12-15-30(a), Code 1975, and in proceedings to determine custody of the child when the child is otherwise before the court. § 12-15-30(b). Nevertheless, the statute does not deprive other courts of jurisdiction to determine the custody of the child when the issue of custody is incidental to the resolution of cases pending in those courts. § 12-15-30(b)(1). Accordingly, when a circuit court acquires jurisdiction over the issue of child custody pursuant to a divorce action, it thereafter retains jurisdiction over that issue to the exclusion of the juvenile court. P.R.G. v. W.P.R., 590 So. 2d 913 (Ala.Civ.App.1991); Taylor v. State, 448 So. 2d 397 (Ala.Civ.App. 1984).
There are, however, two important exceptions to this rule. First, the juvenile court may adjudicate matters of child custody when there are emergency circumstances which threaten the immediate welfare of the child, even if the circuit court has already gained jurisdiction over the issue of custody through a divorce action. Roberson v. Mc-Aliley, 387 So. 2d 840 (Ala.Civ.App.1980). Alternately, *300 the juvenile court may assume jurisdiction to adjudicate custody when DHR brings a separate action alleging dependency and requesting that custody be removed from the custodial parent due to neglect and inability to care for the child. Carter v. Jefferson County Department of Pensions & Security, 496 So. 2d 66 (Ala.Civ.App.1986). In such circumstances, the central issue is the child's immediate welfare rather than a mere determination of custody between two fit parents. Id.
In this case, the dependency action was initiated by the mother, not DHR, and was not based on allegations of neglect or of a threat to the child's immediate welfare. The mother's statement in the dependency petition is merely speculative: "[The] child may be in danger, Child's father has exhibited violent behavior, Child may be in danger in father's care. Child's father is on medication for behavior disorders. I request immediate custody of the child." Moreover, it is clear from the petition itself that DHR did not consider the situation described by the mother to be an immediate threat to the child's welfare. The printed DHR dependency petition form contains the following standard provision:
"The said child is ... in immediate or threatened danger or physical and/or emotional harm in that:
[space provided to describe such danger or harm]
and he should be removed immediately."
After interviewing the mother for the dependency petition, the DHR intake officer who completed the petition typed a row of X's over this provision to completely delete it.
At the final hearing on the dependency proceeding, the testifying DHR officer specifically stated that the agency did not see any reason to declare the child dependent. The mother has now agreed to share custody of the child with the father and to allow him to retain primary physical custody of the child; certainly, she would not so agree if she feared for the child's safety under his father's care.
From the foregoing facts, we must conclude that the circumstances of the dependency action do not fall within the exceptions that would empower the juvenile court to adjudicate the issue of custody. There is simply no evidence of an emergency situation which required the juvenile court's usurpation of jurisdiction; rather, it appears that the mother merely sought to gain temporary custody of the child in a different forum after failing to do so in the circuit court.
The juvenile court was without jurisdiction to determine the issue of custody here; therefore, its order is void and mandamus will lie to vacate the judgment. Smith v. Alabama Dry Dock Shipbuilding Co., 293 Ala. 644, 309 So. 2d 424 (1975). With the voiding of its order, the juvenile court no longer retains jurisdiction to adjudicate the issue of custody as presented in the mother's dependency petition; accordingly, a writ of prohibition is unnecessary to prohibit further adjudication of this particular petition. However, we would point out that the juvenile court is not prevented from gaining concurrent jurisdiction over the issue of custody in the future if circumstances arise which warrant such an intervention.
WRIT GRANTED.
ROBERTSON, P.J., and THIGPEN, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604150/ | 645 So. 2d 1244 (1994)
C.E. MORAN
v.
Douglas C. HARRIS and Continental Baking Company.
No. 93 CA 2226.
Court of Appeal of Louisiana, First Circuit.
November 10, 1994.
Writ Denied February 17, 1995.
*1245 Jerald P. Block, Thibodaux, and Curtis Gordon Gretna, for plaintiff-appellant.
Jason Lyons, Houma, for defendants-appellees.
William F. Kelly, Metairie, for intervenor-appellee, Prudential Property & Cas. Ins.
Before EDWARDS, SHORTESS and LeBLANC, JJ.
SHORTESS, Judge.
This appeal arises from a car accident on February 10, 1990. Cecil E. Moran (plaintiff) was struck from the rear by Douglas C. Harris (defendant) while waiting in traffic in Houma, Louisiana. Plaintiff sued Harris and his employer, Continental Baking Company, and its insurer, The Travelers Insurance Company (defendants).[1] A jury found the accident occurred and Harris was 100% at fault, but then found plaintiff's injuries were not caused by this accident. Plaintiff appealed, contending the jury verdict was erroneous.
The record shows the blow to plaintiff's vehicle was minor. Both vehicles were stopped in traffic waiting while a bridge opened to allow boats through the passage. Defendant was driving a step-van which apparently rolled forward into the bumper of plaintiff's pick up truck. At the time, plaintiff, a chiropractor, was on his way to a business meeting with another chiropractor, Dr. Richard Whitney. Plaintiff continued on to his meeting; however, Whitney testified he complained of back and neck pain immediately upon his arrival. Plaintiff saw Dr. Donald Judice, a neurosurgeon, five days after the accident. Judice's diagnosis at that time was cervical strain with a possible herniated lumbar disk. He ordered an MRI, which was performed February 19, 1990. The radiologist's reading of the MRI showed plaintiff had two herniated disks and a bulging disk in his neck, and a bulging disk in the lower back. Judice, who also interpreted the MRI, agreed with the radiologist's report. Judice testified his objective findings were muscle spasm in the neck on the right side, decreased reflexes in the front and sometimes the back of plaintiff's arm, muscle spasms in the low back, particularly on the right side, and diminished ankle reflex. These findings remained fairly constant. Judice testified that over time plaintiff complained of increased pain, but that plaintiff "stayed the same from a neurological standpoint." Judice recommended plaintiff have surgery on his neck and also recommended surgery on his lower back. Judice recommended plaintiff refrain from lifting over twenty pounds, carrying more than fifteen pounds, climbing ladders, doing any repetitive stair climbing, and sitting, standing or walking more than two hours without a break, operating heavy, vibrating machinery, and wearing heavy headgear.
Plaintiff testified that since the accident he has suffered constant pain. He continued his chiropractic practice until October 1990 but discontinued working after that time. His office staff testified that prior to the accident he was an energetic, enthusiastic, healthy, and hard-working individual. After the accident, he tired easily, took frequent breaks, *1246 complained of back pain, and was generally more grouchy and depressed. His staff and several of his colleagues testified plaintiff never complained of neck or back problems prior to the accident and to their knowledge had no previous history of neck or back problems.
Defendant showed a videotape of plaintiff which was filmed July 7, 1990, approximately four months after the accident. The video shows plaintiff performing work at a sewerage plant servicing a trailer park which plaintiff owned. In the video, plaintiff is lifting pipe, pulling equipment from a bent-over position, pushing, crouching, bending, stooping, and generally performing relatively heavy labor over approximately two hours. He is also shown moving his head and neck in all directions, including tilting his head backward to drink a soda.
Plaintiff contends the jury should have applied the presumption that when a person is in good health before an accident, but the disabling symptoms appear commencing with the accident and continuously manifest themselves, the disability is presumed to be the result of the accident. This is assuming there is a reasonable medical probability the injuries could have been caused by the accident. Housley v. Cerise, 579 So. 2d 973 (La.1991); Arceneaux v. Howard, 633 So. 2d 207 (La.App. 1st Cir.1993), writ denied, 634 So. 2d 833 (La.1994).
Plaintiff's colleagues, friends, and staff testified he appeared to be strong and healthy prior to the accident, and no evidence showed otherwise. Dr. Pete Rhymes, an orthopedic surgeon, treated plaintiff in June 1987 for muscle tightness and swelling around the side of the head and neck after plaintiff was struck by a motor box, but Rhymes did not think this incident left any continuing neck problem.
Judice and Rhymes both testified that a small impact can herniate a disk. Judice stated he had seen significant herniations from something as simple as sneezing and, in one case, with no trauma at all. Furthermore, this court has stated previously that where medical experts and lay witnesses establish that a plaintiff sustained some injuries, the minimal force of the collision causing the injuries is of no material importance. Arceneaux, 633 So.2d at 210; Boykin v. Washington, 401 So. 2d 488 (La.App. 2d Cir. 1981).
Nevertheless, the Housley presumption is a rebuttable presumption, and the causal link can be broken if the opposition successfully rebuts plaintiff's evidence.
No medical evidence was produced to rebut the lay testimony by plaintiff and his witnesses concerning his prior health. Defendant's primary rebuttal evidence was the surveillance videotape.
We are mindful that a videotape may show only brief intervals of the activities of the subject and may not show the aftereffects of the activities shown on the tape. Glover v. Southern Pipe & Supply Co., 408 So. 2d 352, 356 (La.App. 4th Cir.1981), writ denied, 412 So. 2d 86 (La.1982). However, the record shows the investigator who filmed the videotape testified and was subject to cross-examination. Plaintiff testified also and was subject to examination concerning his activities during the video, during any gaps, and afterward.
Plaintiff contended throughout the trial that he was so disabled by pain he could no longer practice as a chiropractor and was essentially destined to live a sedentary life. The videotape completely contradicts plaintiff's complaints of pain and inability to work. The video shows plaintiff violating every one of Judice's and Rhymes' restrictions without any indication he is experiencing any restricted movement, pain, or even discomfort. Several times plaintiff lifted or moved heavy objects. Plaintiff repeatedly stooped, bent down, and moved his neck in all directions and backward without any appearance of restricted movement, pain, or discomfort. When he was questioned about the activities shown on the video, plaintiff never indicated he experienced any pain as a result of doing continuous manual labor for approximately two hours.[2]
*1247 In light of the entire record, we cannot say the jury committed manifest error in completely discrediting plaintiff's testimony.
We can also see why a jury could reasonably discredit and reject the testimony of plaintiff's witnesses concerning his prior health and whether this accident was the cause of the present state of his neck and back.
Plaintiff's three office assistants testified on his behalf. All three are sisters, and plaintiff had an ongoing "amorous" relationship with one of them.
Whitney, the chiropractor with whom plaintiff met immediately following the accident and who gave plaintiff chiropractic treatments until August 1990, testified his bills for 32 visits totaled $3,200.00, but he did not intend to charge plaintiff anything if plaintiff failed to recover in the lawsuit.
Rhymes and Judice both stated their opinion as to the cause of plaintiff's injuries was based on the history provided by plaintiff. Rhymes testified he relies primarily on patient history in reaching the conclusion that a single traumatic event has caused a herniated disk. Judice testified it was possible plaintiff suffered a soft tissue injury and subsequent chiropractic manipulations brought on nerve impingement. Whitney testified that he manipulated plaintiff the day of the accident, February 13th, 14th, 15th, 16th, and 17th. Plaintiff's MRI was performed on the 19th.
The jury could reasonably have discredited plaintiff's testimony as unreliable based on the video and discredited his staff's testimony as biased and unreliable because of his personal relationship with one of them and their relationship to each other. Doctors Rhymes and Judice's opinion on causation was only as reliable as the patient history on which it was based. The doctors also provided alternative causes for plaintiff's injuries. Whitney had a financial interest in the outcome of the litigation.
The Louisiana Supreme Court has often stated:
When findings are based on determinations regarding the credibility of witnesses, the manifest errorclearly wrong standard demands great deference to the trier of fact's findings; for only the fact finder can be aware of the variations in demeanor and tone of voice that bear so heavily on the listener's understanding and belief in what is said.
Lirette v. State Farm Ins. Co., 563 So. 2d 850, 852-53 (La.1990).
Thus, we cannot say the jury committed manifest error in finding plaintiff's injuries were not caused by this accident. In light of the entire record, the jury's view was a permissible one. When two permissible views of the evidence exist the fact finder's choice between them cannot be clearly wrong. Stobart v. State, Dept. of Transp. & Dev., 617 So. 2d 880, 883 (La.1993).
Plaintiff further contends the trial judge committed prejudicial error by unfairly restricting plaintiff's closing argument. During the trial, one of defendants' expert witnesses, Dr. Whitman McConnell, injured his achilles tendon and was unavailable to testify. Rather than postponing the trial several weeks, the defense decided not to call this witness. Defendants had referred to McConnell's testimony in opening statements. The court decided the defense would not be allowed to refer to McConnell's testimony in closing arguments and plaintiff would not be allowed to refer to the failure of the defense to call McConnell. The trial court declined to instruct the jury that a negative inference could be drawn from the defense's failure to call McConnell and instead instructed the jury as follows:
THE COURT:
Ladies and gentlemen, before we get into the closing arguments of the attorneys there is one matter that I feel that I must instruct you on. At the beginning of this trial I read out a list of witnesses to you. One of those names was a Dr. McConnell. During opening arguments by defense counsel he was referred to and his proposed testimony in great length and detail. And during the process of the early week *1248 there was several or many questions asked of various witnesses concerning potential testimony of Dr. McConnell. This is to inform you that Tuesday evening Dr. McConnell was in some type of accident, was rushed to surgery on Wednesday morning, and became unavailable to give testimony in this case. I am therefore, as I previously instructed you at the beginning of this trial I believe I mentioned to you that the argument of counsel is not evidence. The evidence comes from this witness stand. So I am now instructing you to totally disregard and not consider one way or the other any previous statements or representations made by any attorney in this case concerning Dr. McConnell and/or any testimony about him that was taken from this case. The fact is that Dr. McConnell has never testified and you are therefore to totally disregard his existence.
Plaintiff contends he should not have been restricted from drawing a negative inference in closing argument from McConnell's failure to testify and that the trial court should have given an instruction that there would be a presumption that the witness's testimony would have been unfavorable.
Generally, when a party fails to produce a witness who is available to him and gives no reasonable explanation, the presumption arises that the witness's testimony would have been unfavorable. Jones v. Trailor, 636 So. 2d 1112 (La.App. 4th Cir.), writ denied, 642 So. 2d 193 (La.1994). The trial court must consider all the facts and circumstances in the case in deciding whether the presumption will apply. Green v. Cement Products Servs., 526 So. 2d 493 (La.App. 1st Cir.), writ denied, 531 So. 2d 270 (La.1988).
The circumstances in this case were that the witness suffered an accident which resulted in emergency surgery and hospitalization. The trial court did not err in refusing to instruct the jury to draw negative inferences from the witness's failure to testify or in refusing to allow counsel to make negative inferences during closing statements. McConnell was not available to testify and his absence was fully and reasonably explained.
However, the jury did find Harris was 100% at fault in the accident; therefore, we amend the judgment to award plaintiff his property damage of $443.91. The judgment is affirmed in all other respects. Costs of this appeal are taxed to plaintiff.
AMENDED, AND AS AMENDED, AFFIRMED.
NOTES
[1] Prudential Property & Casualty Insurance Company, plaintiff's insurer, intervened for $8,708.00 for medical bills paid on plaintiff's behalf. At trial it was stipulated that Prudential was entitled to recover if there was a judgment or settlement.
[2] Plaintiff suggested there are unexplained time gaps in the videotape, but did not state anything different happened during those gaps. Furthermore, the investigator testified no gap was for more than two minutes, except one nine-minute gap during which he was changing his location. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604138/ | 645 So. 2d 944 (1994)
Joan (Tate) RUFF
v.
Robert Jean RUFF, Jr.
No. 93-CA-0293.
Supreme Court of Mississippi.
November 17, 1994.
Drue D. Birmingham, Jr., Olive Branch, for appellant.
No Brief Filed for appellee;
Before HAWKINS, C.J., and PITTMAN and BANKS, JJ.
HAWKINS, Chief Justice, for the Court:
On August 24, 1990, appellant Joan (Tate) Ruff (hereinafter Joan) filed a Complaint in the Nature of a Bill for Divorce. Sometime later, on January 7, 1992, she filed an Amended Complaint for Divorce. On January 21, 1992, Joan filed a Motion for Temporary Relief and a Complaint for Temporary Restraining Order Without Notice. The Temporary Restraining Order Without Notice was granted that same day.
On January 28, 1992, Joan's husband Robert Jean Ruff, Jr. (hereinafter Robert), responded with his Answer to Complaint for Divorce and Counterclaim. Joan replied in turn with an Answer to Counterclaim for Divorce on February 3, 1992. Then, on February 10, 1992, her Order for Temporary Relief was granted. A hearing was held December 8, 1992, in the Chancery Court of DeSoto County before Chancellor Melvin McClure and a Final Decree of Divorce was entered December 21, 1992.
Joan subsequently filed a Motion to Amend Judgment on December 23, 1992, which was denied on February 24, 1993. On March 16, 1993, she filed a Notice of Appeal.
FACTS
Joan (Tate) Ruff and Robert Jean Ruff, Jr., were married on April 11, 1984. No children were born to Joan and Robert although during the course of the marriage he adopted her daughter Nicole, born June 4, 1973.
In 1986 Robert's parents gave about an acre and a half of land to him and Joan as tenants in the entirety. This gift split up a 20-acre tract which the parents owned and on which they lived. Robert and Joan then built a Jim Walter home upon their newly-acquired land. The value of this house is hard to determine. At the time of the hearing, a home mortgage of $46,000 was still outstanding. Furthermore, according to Joan, Robert was responsible for extensive damage caused to the home in her absence which would have to be repaired before the home could be sold. Finally, Joan stated that in her opinion the land was worth $1,300 an acre and the house was worth $50,000-$60,000.
At the hearing, both parties testified that their marriage suffered greatly because of Robert's excessive drinking. According to Joan, Robert became intoxicated and passed out daily by drinking half a liter of Jack Daniels. He in turn admitted that his alcoholism was the primary cause of the problems *945 in their marriage. Joan additionally stated that Robert's drinking binges at times became violent with him attempting to kick in their bedroom door once, breaking their living room window twice, and trying to choke her so many times that she lost count. She also claimed that at one point in June of 1990:
Again he was drunk and he was mad at me this time, I don't know why, I think I had told him that if he didn't try to get some help that I was leaving, and he ran into the bedroom and he got his gun, and I was sitting at the dining room table and as he started towards me with the gun I ran to the phone and I called his parents' house, and his dad answered the telephone, and I said your son is standing here with a gun pointed to my head, I suggest you get back here now, and I hung up the phone, and as I hung up the phone Bob pulled the trigger of the gun and he said I can get rid of you faster than you can leave.
Joan left Robert that same month and filed for divorce on the grounds of irreconcilable differences the following August 24. She returned in April of 1991, however, after Robert completed an alcoholic treatment program at Parkwood. Nevertheless, according to Joan, the drinking and violence soon resumed despite the treatment. She stated that another incident happened in December of 1991:
He had come in from his parents' house, and he was drunk. He first passed out on the couch, and when he finally woke up he was made [sic] because I had not gone up to his parents', stopped at his parents' house when I had come in, and he proceeded to knock everything off of the coffee table, and ended throwing the coffee table upside down, and it has got glass inserts, and then he went into the kitchen and he got a knife, and he started towards me with it, and I ran.
The record states that Joan left Robert for the final time in November of 1991.[1] On January 7, 1992, Joan filed an Amended Complaint for Divorce which added the grounds of habitual cruel and inhuman treatment and habitual drunkenness.
In addition, the amended complaint also contained an elaborate plan for the disposition of the parties' house. Joan requested that:
D. (1) The Court divest the Defendant's undivided interest in and to the family residence at 711 Ross Road, Olive Branch, DeSoto County, Mississippi, and vest it in the Plaintiff.
Or, in the Alternative:
D. (2) The Defendant shall quitclaim to the Plaintiff all of his right, title and interest in and to the family residence at 711 Ross Road, Olive Branch, DeSoto County, Mississippi. The Plaintiff shall be responsible for and pay all indebtedness thereon, and all taxes and insurance.
Or, in the Alternative:
D. (3) The Plaintiff shall be awarded exclusive use and possession of the parties' residence at 711 Ross Road, Olive Branch, DeSoto County, Mississippi, for so long as child support is payable by the Defendant, or for forty-eight (48) months, whichever is longer.
If at any time the Plaintiff, at her option, vacates said property, or if she remarries, either party may place said property on the market for sale, and the net proceeds thereof shall be divided between the parties as hereinafter described:
If the sale is closed by January 1, 1993, then the net equity shall be divided sixty percent (60%) to the Plaintiff and forty percent (40%) to the Defendant. The Defendant's equity shall decrease ten percent (10%) for each additional year before sale, to wit:
1) If the sale is closed between January 2, 1993, and January 1, 1994, the Defendant's equity shall be 30%.
2) If the sale is closed between January 2, 1994, and January 1, 1995, the Defendant's equity shall be 20%.
3) If the sale is closed between January 2, 1995, and January 1, 1996, the Defendant's equity shall be 10%.
*946 4) After January 1, 1996, the Defendant shall have no equity in said property.
As soon as it is determined and applicable that the property be sold, the parties shall make every reasonable effort to close the sale as soon as practicable. If there be disagreement between the parties as to the selling price of said property, the Plaintiff shall have the property appraised by a qualified, disinterested real estate appraiser, and the fair market value so determined shall be the minimum amount the parties shall be required to accept in the absence of any agreement between the parties to the contrary.
Nothing provided hereinabove shall preclude either party from initiating a partition suit if the Plaintiff vacates said property or remarries; however, the division of net equity shall be as provided in this section.
During the period in which the Plaintiff occupies said property, the Plaintiff shall be responsible for the home note to Mid-State Homes, taxes, insurance and maintenance thereon.
Any deficiency in the payments of child support by the Defendant as provided herein shall be deducted from his share of the equity therein, and shall constitute a lien on his interest in said property.
Robert filed an Answer to Complaint for Divorce and Counterclaim on January 28, 1992, to which Joan replied on February 3, 1992.
A hearing was held before Melvin McClure on December 8, 1992, who handed down his Final Decree of Divorce on December 21, 1992. The Chancellor granted Joan a divorce on the grounds of habitual cruel and inhuman treatment and habitual drunkenness. His decree also stated:
6. IT IS FURTHER ORDERED, ADJUDGED AND DECREED that, with reference to the parties' residence presently titled in both names, inasmuch as the Court does not have the authority to divest title from the Defendant and place it in the Plaintiff, no order shall be made relative thereto except that either party shall have the right to bring a Petition For Partition of said residence. Further, the Court makes no order regarding who shall occupy said residence or be responsible for the monthly mortgage payments thereon pending a sale, division, or other disposition of said residence.
... .
8. IT IS FURTHER ORDERED, ADJUDGED AND DECREED that the Plaintiff be awarded reasonable attorney fees in the sum of $2,820.55, payable from the Defendant's share of the equity in the parties' residence, if and when said residence is sold. Further, such sum is to attach as an equitable lien on the Defendant's equity in said residence, and shall draw interest at the rate of 8% annually, beginning January 1, 1993, until paid. IT IS FURTHER ORDERED, ADJUDGED AND DECREED that if said residence is not sold within a reasonable time, or if the Defendant's equity therein is not sufficient for the payment of such $2,820.55 plus interest, then such sum or any deficiency therein, shall be paid by the Defendant at the rate of $100.00 per month.
Disagreeing with the Chancellor's disposition of the property and plan for payment of attorney fees, Joan filed a Motion to Amend Judgment on December 23, 1992, which was denied by Chancellor McClure on February 24, 1992. Joan appealed to this Court on March 16, 1993.
LAW
Although the appellant Joan Ruff cites four issues in her brief for this court to consider on appeal,[2] there is actually only one can a chancellor divest title from one spouse in a divorce action and vest it in the other?
In the past there was some amount of confusion in the law of Mississippi as to whether a chancellor was so authorized. However, the case of Draper v. Draper, 627 So. 2d 302 (Miss. 1993), laid the matter to rest. In that case the chancellor took title in the family home from the husband and forced him to deed it to his wife. In affirming the *947 actions of lower court, this Court stated, "The chancellor in a divorce case now has the authority to divest title from one spouse, and vest it in the other spouse, when equitably dividing the marital assets." Id. at 305. Furthermore, in order to determine what the proper equitable division of property between the spouses should be, a chancellor must make a careful analysis of the parties' economic contributions to the marriage. Johnson v. Johnson, 550 So. 2d 416 (Miss. 1989). Ferguson v. Ferguson, 639 So. 2d 921 (Miss. 1994), and Hemsley v. Hemsley, 639 So. 2d 909 (Miss. 1994), provide useful guidelines for making this equitable division.
The chancellor did not have the benefit of our decisions in Draper, Ferguson, and Hemsley that chancellors do have the authority to transfer title, and therefore did not have the occasion to consider the factors set forth in those decisions. We therefore reverse and remand for the chancellor to consider the principles enunciated in those recent decisions. In addition, as the chancellor's plan for repayment of attorney's fees was based upon his pre-Draper division of property, it too should be reversed and redetermined consistent with our recent holdings.
This case is therefore reversed and remanded for proceedings not inconsistent with this opinion.
REVERSED AND REMANDED FOR PROCEEDINGS NOT INCONSISTENT WITH THIS OPINION.
DAN M. LEE and PRATHER, P.JJ., and SULLIVAN, PITTMAN, BANKS, JAMES L. ROBERTS, Jr., and SMITH, JJ., concur.
McRAE, J., concurs in result only.
NOTES
[1] Note that this places the December, 1991, violent episode one month after Joan had moved out. The record does not explain this discrepancy.
[2] It bears noting that the appellee Robert Ruff did not file an appellee's brief. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604145/ | 645 So. 2d 771 (1994)
Geryal DAVIS
v.
ST. JUDE MEDICAL CENTER, INC.
No. 94-CA-353.
Court of Appeal of Louisiana, Fifth Circuit.
October 25, 1994.
Writ Denied January 27, 1995.
William W. Shaw, Jr., Martin S. Bohman, Blue Williams, Metairie, for defendant-appellant.
Morris H. Hyman, New Orleans, for plaintiff-appellee.
Before GRISBAUM, DUFRESNE and GOTHARD, JJ.
GRISBAUM, Judge.
This appeal arises out of a suit for damages pursuant to a claim for false imprisonment. The defendant raised the exception of prematurity on the basis that the plaintiff's claim was one of medical malpractice. The exception was denied. We affirm and remand.
ISSUE
The principal question is whether this claim sets out a cause of action for false imprisonment under La.R.S. 28:2(28)(b) or medical malpractice.
FACTS
Plaintiff, Geryal Davis, was being treated at St. Jude Medical Center, Inc. (St. Jude) on an in-patient basis for pancreatitis. He was admitted on October 15, 1992. On November 7, 1992 Davis was involuntarily admitted to defendant's chemical dependency and mental health unit by a staff doctor at St. Jude.
The pleadings reflect that Dr. Gabriel Uribe prepared and signed a Physician's Emergency Certificate to initiate Davis' involuntary admission to the St. Jude chemical dependency and mental health unit. St. Jude also obtained (on November 9, 1992) a Coroner's Emergency Certificate to recommend commitment to the St. Jude chemical dependency and mental health unit on the basis of alcohol dependance.
Davis alleges he made several requests to be released and even notified St. Jude in writing of this desire. A habeas corpus hearing was set for November 20, 1992, pursuant to Davis' Petition and Order for Writ of *772 Habeas Corpus and Probable Cause filed in the Twenty-Fourth Judicial District Court. On November 19, 1992, Davis was discharged from St. Jude.
Davis claimed St. Jude violated his rights by falsely imprisoning him in the St. Jude chemical dependency and mental health unit because St. Jude did not maintain separate in-patient facilities for chemical dependency patients as required by La.R.S. 28:2(28)(b).
PRELIMINARY MATTERS
St. Jude filed a Motion to Strike Exhibits that are not part of the record on appeal, which are attached to plaintiff's brief, and all reference thereto of:
(a) Exhibit 2Petition and Order for Writ of Habeas Corpus and Probable Cause Hearing;
(b) Exhibit 3Physician's Emergency Certificate; and
(c) Exhibit 4Coroner's Emergency Certificate.
St. Jude also argues these exhibits were not introduced into evidence at the trial court level and, thus, cannot be considered by the Court of Appeal. We agree. Examination of exhibits attached to an appellate brief, but not offered into evidence at trial, is beyond the scope of review for the Court of Appeal. Uniform RulesCourts of Appeal, Rule 1-3; Coleman E. Adler & Sons, Inc. v. Waggoner, 538 So. 2d 1131 (La.App. 5th Cir.1989).
Ergo, we will not consider Exhibits 2-4 attached to appellee's brief.
We note the trial judge signed an appeal order for a "suspensive appeal without bond." There is no such appeal. Accordingly, we have converted this matter to a devolutive appeal. See Triangle v. Gulf Coast Aluminum Corp., 399 So. 2d 183 (La.1981).
ISSUE PRESENTED FOR REVIEW
Law
La.Code Civ.P. art. 926 provides for the dilatory exception of prematurity. Jurisprudence indicates it has long been recognized that the question of prematurity of a demand must be determined by the state of facts existing at the time the suit is brought. See Weldon v. Republic Bank, 414 So. 2d 1361 (La.App. 2d Cir.1982).
Discussion
The only facts existing at the time this suit was brought are those alleged in the plaintiff's petition, defendant's memorandum on the exception of prematurity, and plaintiffs' opposing memorandum. The transcript of the hearing on the exception does not contain any facts, nor did the parties attach any exhibits as evidence in the trial court.
The crux of plaintiff's claim is simply that St. Jude maintained a "joint in-patient substance abuse and mental health unit." He cites La.R.S. 28:2(28)(b), which, in pertinent part, states:
However, in the case of any involuntary hospitalization as a result of such emergency certificate for substance abuse or in the case of any judicial commitment as the result of substance abuse, such commitment or hospitalization may be made to any of the above facilities, except forensic facilities, provided that such facility has a substance abuse in-patient operation maintained separate and apart from any mental health in-patient operation at such facility.
Essentially, the plaintiff is maintaining that, because he was involuntarily committed by an Emergency Certificate to a facility that did not have separate substance abuse and mental health in-patient units, there was then necessarily a violation of La.R.S. 28:2(28)(b).
On the other hand, defendant argues the plaintiff is seeking damages allegedly arising from actions which constitute health care and/or professional services rendered by St. Jude. Thus, the claim falls within the scope of the Medical Malpractice Act, which would require the matter proceeding to a medical review panel prior to the institution of suit.
Defendant likewise argues it was a medical decision to admit the plaintiff to the joint chemical dependency and mental health unit. However, we note the record does not contain any evidence that refutes the plaintiff's allegation that he was committed due to alcoholism, i.e., substance abuse, and because the defendant was the exceptor, he had the legal burden of producing this evidence but did not. Ironically, the evidence that was relevant *773 to this point, namely, the Physician's Emergency Certificate and the Coroner's Certificate, are not part of the record and were properly stricken from consideration as part of appellee's brief at the request of the defendant.
Accordingly, we find that the allegations in the plaintiff's pleadings establish a cause of action that he was illegally committed.
For the reasons assigned, the trial court's judgment is hereby affirmed, and the matter is hereby remanded for further proceedings. All costs of this appeal are to be assessed against the appellant.
AFFIRMED AND REMANDED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604230/ | 401 F. Supp. 1142 (1975)
Mark H. ADAMS et al., Plaintiffs,
v.
UNITED STATES of America, Defendant.
No. W-4684.
United States District Court, D. Kansas.
July 23, 1975.
*1143 *1144 Mark H. Adams, of Adams, Jones, Robinson & Malone, Wichita, Kan., for plaintiffs.
Irving Shaw, Asst. U. S. Atty., Robert J. Roth, U. S. Atty., Wichita, Kan., Douglas G. Anderson, Yale F. Goldberg, Robert S. Milligan, Trial Atty. Tax Div., Refund Trial Sec. No. 3, Dept. of Justice, Washington, D. C., for defendant.
DECISION OF THE COURT, TOGETHER WITH FINDINGS OF FACT AND CONCLUSIONS OF LAW
THEIS, District Judge.
INTRODUCTORY STATEMENT
This action arose as a suit for refund of federal estate taxes and interest in the stated amount, brought by the Executors of the Will of a substantially wealthy decedent against the Government. There is no dispute between the parties as to venue or jurisdiction of the Court, which is granted jurisdiction under 28 U.S.C. § 1341(a)(1). Trial was had to the Court and the matter submitted. The Court now makes Findings of Fact and Conclusions of Law, followed by "Decision of the Court," setting forth the reasoning and legal authorities applied by the Court in reaching a decision in this matter.
FINDINGS OF FACT
1. This is an action for the refund of federal estate taxes and interest in the amount of $901,088.85, plus interest thereon as provided by law, in which action there were three issues:
(a) Claimed marital deduction free of federal estate tax;
(b) The amount of administrative expense to which the estate is entitled as deduction against federal estate taxes;
(c) What, if any, charitable deduction from federal estate taxes is the estate entitled?
On August 31, 1973, judgment was entered for the plaintiffs on issue (a) above set forth. Presently the parties have filed herein stipulation and agreement for a judgment in favor of the plaintiffs on issue (b) fixing the amount of the deduction against federal estate tax for the estate in the sum of $368,564.62, and for judgment accordingly.
2. Tom Palmer died testate May 19, 1966, and his Will was admitted to probate in the proceedings in the Probate Court of Sedgwick County, Kansas; Mark H. Adams, Hugh S. Edgerton, Jeff C. Lyle and The Union National Bank of Wichita, Kansas, are the duly qualified and acting Executors under such Will and are the duly appointed, qualified, and acting trustees under the two separate and distinct trusts provided for under such Will, a true copy of which is attached to the Pre-Trial Order as Exhibit "A".
*1145 3. After certain bequests relating to testator's homestead, household furnishings, automobile and other such items to decedent's wife and certain bequests to certain of decedent's employees, Paragraph Seventh of decedent's Will bequeaths to each of decedent's grandchildren, Dianne Courtney Buller and John Thomas Courtney, the sum of $25,000.00. Under Paragraph Eighth of decedent's Will, all the rest, residue, and remainder of said estate was given, devised and bequeathed unto Mark H. Adams, Hugh S. Edgerton, Jeff C. Lyle, and The Union National Bank of Wichita, Kansas, in trust, to have and to hold the same upon two separate and distinct trusts:
A. TRUST "A"
"1. To have and to hold an undivided one-half (½) of said residuary estate, said trust to be designated as Trust `A'.
2. During the existence of said trust, said trustees shall pay all of the net income from said trust estate to my wife, Daisye Palmer, for and during the period of her natural life, in quarterly or monthly payments, as said trustees shall determine.
3. I specifically direct that my wife, Daisye Palmer, shall have the power, exercisable by her alone and in all events to appoint the entire corpus of said trust or any portion thereof, free of said trust. Said power of appointment may be exercised by her in favor of her estate, or such person or persons as she may direct, and it may be exercised by her by Will.
4. Upon the death of my wife and in event she has not exercised the foregoing power of appointment, I direct that the remaining corpus and undistributed income, if any, in said Trust `A' shall be by the trustees thereof assigned, transferred and distributed to and merged with, and thereafter administered and distributed as a part and in accordance with the terms of Trust `B' hereinafter referred to."
B. TRUST "B"
"1. To have and to hold an undivided one-half (½) of said residuary estate, said trust to be designated as Trust `B'.
2. With respect to the net income from said trust, I direct:
(a) That during the lifetime of my daughter, Eileen Palmer Courtney (now Eileen Hipps), there shall be paid and distributed to her $600 a month.
(b) During the lifetime of my wife, Daisye Palmer, the remainder thereof shall be paid and distributed to her.
(c) Any remainder thereof shall be retained in said trust for reinvestment purposes and ultimate distribution as hereinafter provided.
3. I direct that my trustees shall pay to or expend for the use or benefit of my grandson, John Thomas Courtney, all necessary funds to pay any medical and hospital expenses by him incurred, and to provide for the care, comfort, maintenance, support and general welfare of my said grandson during his lifetime, and at the time of his death provide adequate funeral and burial services. While it is my desire that the trustees liberally provide for my grandson, said trustees shall, in their sole discretion, determine and conclude, from time to time, the extent and amount of care, support and maintenance expenditures from said trust estate.
4. Upon the deaths, respectively, of my wife, Daisye Palmer, my daughter, Eileen Palmer Courtney, and my grandson, John Thomas Courtney, I direct and authorize my trustees to contribute and make *1146 distribution of the remainder of such trust estate:
(a) To Hugh S. Edgerton and to Jeff C. Lyle, in equal shares, Lots 41, 43, 45 and 47 on Lawrence Avenue, now Broadway Avenue, in Greiffenstein's Original Town, now City of Wichita, in Sedgwic County, Kansas, as shown by the recorded plat thereof;
(b) The remainder of said trust funds and property shall be paid and distributed to a charitable and educational corporate foundation, to be created by the trustees, to be known and designated as "The Ella Palmer Foundation". That in the formation of such corporate foundation, its trustees shall be empowered to make contributions from either or both the corpus and income of the foundation properties to other educational or charitable corporations in Wichita, Kansas, in each instance for the establishment of a memorial to my mother, Ella Palmer."
Said Will then proceeds under Paragraph Ninth thereof, to provide:
"The trustees of my said Trusts `A' and `B' shall have the following powers, rights, duties and obligations:
. . . . . .
(d) I hereby authorize my said Trustees, irrespective of the provisions for the distribution of my said trust estates, to at any and all times pay from either the income or corpus of these trust estates to any of the beneficiaries hereinabove named or designated, such sum or sums of money as in the opinion and sole discretion of said Trustees shall be deemed necessary, advisable and requisite for their maintenance, support, care and health. Should any payment be made under this provision to any such person, the same shall be charged as an advancement to the share of such person in such trust estates, if such person's interest therein is that of an ultimate beneficiary."
Paragraph Fifteenth of decedent's Will then provides:
"I instruct and direct my executors to establish the trusts in this Will created at the earliest possible date, place therein immediately all assets of my estate, which are not otherwise devised or bequeathed or are necessary for the payment of debts, expenses or taxes which may be chargeable to, or assessed against, my said estate. I specifically authorize and direct the executors acting hereunder to make payments which my trustees may be authorized to make, as hereinbefore provided for, to the beneficiaries named or designated herein, at the time and in the manner hereinbefore set forth, and to continue to make said payments until my trustees shall qualify and receive the assets of the respective trusts created by this Will."
4. At the time of decedent's death, he left a gross estate of a value of approximately $4,290,000.00.
5. After the payment of all specific bequests and estimated state inheritance and federal estate taxes, there remains in said estate and as partially distributed to Trust Estates "A" and "B" property valued as of September 30, 1974, as follows (see Plaintiff's Exhibit 12):
(a) In decedent's estate, property of the approximate value of $175,000.00.
(b) Distributed to Daisye Palmer through Trust Estate "A", property of the approximate value of $975,000.00.
(c) In Trust Estate "B", property of the approximate value of $975,000.00.
The final distribution awaits a final determination of the federal estate taxes ($352,303.77 having been paid with return filed in 1967) and state inheritance *1147 taxes due from said estate or by reason of the succession thereof, there having heretofore been paid Kansas succession and inheritance taxes in the sum of $66,224.24; that before the payment of the additional federal estate tax, and interest thereon, complained of, there was in the estate and the trust estates property of a total value of approximately $3,475,000.00, from which (on experience to date) there has accrued net income per annum of in excess of $100,000.00.
6. Under date of June 2, 1969, Articles of Incorporation of the Ella Palmer Foundation, Inc., were issued by the Secretary of State of Kansas, and the same was supplemented by amendment dated June 27, 1969, creating a corporation organized not for profit to comply with the instructions in decedent's Last Will and Testament, the purpose of such corporation being to transact and carry on charitable, scientific or educational purposes within the meaning of § 501(c)(3) of the United States Internal Revenue Code of 1954, as amended. U. S. Treasury Exemption Certificate was granted such Foundation on July 11, 1969.
7. At the time of decedent's death, the following persons were of the following ages, with the following life expectancies:
Life
Name Age Expectancy
Daisye Palmer, wife 66, birthdate May 20, 1900 10.5 yrs.
Eileen Palmer Courtney, 43, birthdate June 22, 1923 26 yrs.
daughter
John Thomas Courtney, 18, birthdate October 14, 1948 43 yrs.
grandson
Hugh S. Edgerton, 50, birthdate January 4, 1916 20.9 yrs.
trustee
Jeff C. Lyle, trustee 43, birthdate February 19, 1923 26 yrs.
8. At the time of decedent's death the separate property of decedent's daughter, Eileen Hipps (nee Courtney), was of nominal value; that as a result of an adversary proceeding in decedent's estate in the Probate Court of Sedgwick County, Kansas, having jurisdiction of the official acts of fiduciaries, plaintiffs herein, order was entered therein on September 26, 1969, fixing and determining that for the care, support and maintenance of said Eileen Hipps, and furnished by the executors of the estate, the fair and reasonable costs of such care, support and maintenance was $1200.00 a month (including the $600.00 per month testamentary legacy); that such cost per month was comparable to that being incurred for the support and maintenance of the said Eileen Hipps in the same standard and fashion she lived on the date of decedent's death; that thereafter, and as a result of a further adversary proceeding in said Probate Court, order was entered therein on September 10, 1971, fixing and determining that for the care, support and maintenance of the said Eileen Hipps in the housing facility furnished by the estate, the fair and reasonable cost thereof was $1300.00 a month (including the $600.00 per month testamentary legacy).
9. Decedent's grandson, John Thomas Courtney, had at the time of decedent's death separate property of a value in excess of $100,000.00 producing an income to him of more than $5,000.00 per year. That in addition thereto, he received a $25,000.00 bequest under decedent's Will, which increased his capital estate in that amount. That during the years 1963, 1964, and 1965, respectively, *1148 John Thomas Courtney lived with his grandparents, decedent Tom Palmer and his wife, and attended Kapaun Memorial High School in Wichita, Kansas. During the year 1964, John Thomas Courtney had an income from his sole property of $1,359.48, which he contributed towards his support. During that year, John Thomas Courtney's grandfather, Tom Palmer, claimed he provided 70% of the cost of support of John Thomas Courtney and was entitled to claim him as an exemption. IRS allowed such a claim. On this basis, the total cost of care, maintenance and education for said minor in 1964 was the sum of $4,531.60; that during the year 1965, John Thomas Courtney had from wages and earnings on his capital, $2,486.70, which he contributed to his support. For said year, decedent Tom Palmer claimed he provided 60% of the cost of support of John Thomas Courtney and was entitled to claim him as an exemption. IRS allowed such claim. On this basis, the total cost of the care, maintenance and education of John Thomas Courtney for the year 1965 was $6,215.00. At the date of decedent's death, John Thomas Courtney had suffered severe and permanent injuries as a result of an automobile-train collision, which left him at least 20% disabled (Defendant's Exhibit H). During the year 1966, in which decedent died, John Thomas Courtney had continued to live in the home of his grandparents, decedent and his wife, here in Wichita, up to the date of decedent's death, after which time he moved to Hutchinson, Kansas, where he lived with his sister, Dianne Buller, paying her for his board and room and paying for registration and entrance fees at Hutchinson Junior College, Hutchinson, Kansas; that the total costs incurred by the said John Thomas Courtney for his care, support, and education for the year 1966, was the sum of $6,000.00; that for each of the years 1967, 1968, 1969, 1970 and 1971, the costs for the support, maintenance, and education of John Thomas Courtney has averaged approximately $6,000.00 a year; in 1972 he was not employed; he did some work at Wichita State University, Wichita, Kansas; that from his wages and earnings from his investments, John Thomas Courtney has been able to support himself since his grandfather's death without the necessity of the payment of any money to him from the income from his grandfather's estate, except $1,000.00 of estate income paid to him in 1966.
10. At the time of decedent's death, the separate property of decedent's wife, Daisye Palmer, was of nominal value. That under the terms of decedent's Will there is by reason of the power of appointment given therein to the said Daisye Palmer available for her use, care, and maintenance, not only one-half of the property in the estate, but also any part of the unexpended income from the other one-half of the property in such estate, which latter one-half will, upon distribution, become the property of Trust "B". Actually, Daisye Palmer did exercise her power of appointment of the property in Trust "A", i. e., one-half of the residue, and distribution was made to her pursuant to a stipulation filed in the Probate Court of Sedgwick County, Kansas, on March 9, 1972. However, the actual exercise of the power post-death is not important to this decision, since the Court considered the power itself to be equivalent to instant distribution at date of decedent's death as a fact.
11. Plaintiffs duly filed in the office of the District Director of Internal Revenue, Wichita, Kansas, on the 15th day of August, 1967, Federal Estate Tax return Form No. 706, and duly paid all federal estate taxes in the sum of $352,303.77 due and payable thereunder in said estate, there being no interest thereon due at that time.
12. On or about July 24, 1970, defendant, by and through its District Director of Internal Revenue, issued its ninety-day letter advising plaintiffs of a deficiency in federal estate tax in said *1149 decedent's estate in the amount of $741,982.40, based respectively upon the disallowance in whole or in part of the following deductions claimed per return:
(a) Administration expenses claimed in the total sum of $279,224.40 there was disallowed as a deduction the sum of $260,659.78 resulting in a deduction allowed of $18,564.62.
(b) Marital deduction claimed in the total sum of $1,924,694.73. There was disallowed as a deduction the sum of $547,354.66, resulting in a deduction allowed of the sum of $1,377,340.07.
(c) Charitable bequest deduction claimed in the total sum of $801,695.63. There was disallowed charitable bequest in decedent's estate to the Ella Palmer Foundation the entire amount of this claimed deduction.
As a result of such disallowances there was a proposed deficiency assessment of federal estate tax of $741,982.40, together with interest thereon to November 20, 1970, in the sum of $144,808.54.
13. In the aforementioned federal estate tax return there was claimed as a deduction administration expenses paid or estimated in the sum of $279,224.40. Subsequently, and on or about August 11, 1970, plaintiffs filed with the United States Treasury Department, Internal Revenue Service claim on Form 843 for additional administration expenses estimated in the sum of $250,000.00, resulting in a claim for refund of federal estate tax of $67,250.00.
14. On or about December 3, 1970, plaintiffs paid to said District Director of Internal Revenue the alleged deficiency of federal estate tax in the sum of $741,982.40, and the sum of $96,000.00 toward the satisfaction of the interest accrued on such alleged deficiency; that thereafter, and on January 15, 1971, plaintiffs paid to said District Director of Internal Revenue $48,808.54 remaining interest due on such federal estate tax deficiency.
15. On or about February 1, 1971, plaintiffs filed with the United States Treasury Department, Internal Revenue Service, their claim for refund on Form 843, of federal estate taxes in the amount of $756,279.51, together with interest paid thereon in the amount of $144,808.54, based respectively upon the following deductions claimed, as more specifically set forth in said Form 843 (Plaintiffs' Exhibit 7).
(a) Administration Expenses: Claimed in the total sum of $521,580.53, resulting in an additional claimed deduction of $503,015.91 in excess of the $18,564.62 previously allowed per the ninety-day letter. (This claim settled by stipulation of the parties.)
(b) Marital Deduction: Claimed in the total sum of $1,806,425.39, resulting in an additional claimed deduction of $429,085.32 in excess of the $1,377,340.07 previously allowed per the ninety-day letter. In the alternative, if the deduction for the administration expenses is decreased, there is hereby claimed the increased marital deduction. (This claim in judgment April 18, 1973.)
(c) Charitable Bequest Deduction: Claimed in the total sum of $705,809.74, resulting in an additional claimed deduction of $750,809.74, as no amount was allowed per the ninety-day letter. In the alternative, if either or both of the deductions for the marital deduction or administration expenses are decreased, there is claimed increased charitable bequest deduction.
16. Everything in Testamentary Trust "B", except the city real estate, will ultimately go to the charitable trust, The Ella Palmer Foundation. Such property or fund already amounts to over $800,000.00, in addition to which there will also accrue to such fund:
(a) The net income from the rental from the real estate in Trust "B" *1150 during the lifetimes of Mrs. Palmer, Eileen Hipps, and John Thomas Courtney;
(b) One-half of the approximate $150,000.00 remaining property in the estate at this time; and also
(c) One-half of the recovery in this tax refund suit.
17. During all the years in which accounting procedure has been completed (to December 31, 1973) since the date of decedent's death on May 19, 1966, payments from the estate to decedent's wife, Daisye Palmer, decedent's daughter, Eileen Hipps, and decedent's grandson, John Thomas Courtney, for their care, support, and maintenance, have as a total been less than the total income from the property in said estate. While under the law of the case the facts are determinable as of the date of death of the decedent and actually post-dated facts must be ignored in finding the facts and applying the law to such facts.
CONCLUSIONS OF LAW
1. Under the Last Will and Testament of the decedent, Tom Palmer, the Trustees are authorized to invade the corpus of Trust "B" for the benefit of non-charitable beneficiaries, including Daisye Palmer, Eileen Palmer Courtney Hipps, John Thomas Courtney, Hugh Edgerton and Jeff Lyle.
2. The Will of the decedent provides an ascertainable standard for calculation of reasonable amounts due from the assets of the estate as may be needed for the care, support and maintenance of the following beneficiaries:
Daisye Palmer, widow
Hugh Edgerton, devisee
Jeff Lyle, devisee
Eileen Palmer Courtney Hipps, daughter
John Thomas Courtney, grandson
in the same fashion and standard as they respectively lived on the date of decedent's death.
3. There is no reasonable likelihood that the decedent's widow, Daisye Palmer, would either need or require any payment from the corpus of the property constituting the assets of Trust "B" in view of wealth accruing to her from the property in Trust "A" and its sizeable income producing potential.
4. As to decedent's daughter, Eileen Palmer Courtney Hipps, viewing the situation at date of testator's death, there exists a probability of invasion of the corpus of Trust "B" during her life expectancy of a yearly amount based on her customary standard-of-living less the amount of specific legacy of $600.00 per month in Paragraph EIGHTH-B-2(a) of the Will. (Living expense was judicially determined by the Probate Court of Sedgwick County, Kansas, to be $1200.00 per month.)
5. As to decedent's grandson, John Thomas Courtney, viewing the situation at date of testator's death, there exists a probability of invasion of the corpus of Trust "B" during his life expectancy of a yearly amount based on his customary standard-of-living as determinable, less known assets which will be offset.
6. As to the devisees Hugh Edgerton and Jeff Lyle, there is no evidence to determine likelihood of invasion, and such determination would have to be made upon the basis of extrinsic evidence at the time of testator's death concerning the financial and personal situation of each devisee. If no likelihood of invasion exists, no deduction from the charitable bequest need be made. On the other hand, if probability of invasion exists, IRS, as the administrative agency, would determine the amount of invasion during the life expectancy of each such beneficiary based on his customary standard-of-living as determinable, less the offset value of the vested remainder interest of each in the specifically devised real estate in Paragraph EIGHTH-B-4(a).
*1151 OPINION OF THE COURT
The Government raises for the first time in its brief the question of plaintiffs' standing to bring this refund action, contending that the plaintiffs' claims in this suit are at variance with those presented to Internal Revenue in their claim for refund filed prior to this suit, and as a prerequisite for the filing of such suit. The Court has examined the claim for refund, the Internal Revenue Service's written denial of it, and recalls that no issue was made of such a variance at the time of trial.
It is the Court's opinion that this contention of the Government is nonsensical, an afterthought, and is well-refuted by the facts. It is clearly apparent that both the taxpayers and the Government, both at the administrative level and in this court, have well understood the contentions of each other and the legal issues extant therein. No one has been misled. It ill behooves the Government's attorneys to raise such a fragile facade to a hearing on the merits of what actually was a most serious and close legal question. The Court believes the officials of Internal Revenue acted quite properly in the interest of the Government in making its administrative determination for the Government, since as the Court later finds, there here existed a factual situation based on the wording of the Will and the size of the Palmer Estate which was somewhere between the two leading United States Supreme Court cases and the two leading Tenth Circuit cases governing the law in this particular area of federal estate taxation. The Government's counsel, likewise, have astutely presented their legal authorities and contentions, both in open court and in their briefs, except the question just addressed. The Court will proceed to dispose of this case on the merits.
After being before the Court for some time, this case has now boiled down to or been reduced to one issue remaining, viz., whether under the terms of the decedent's Will, such Will creates a charitable remainder interest which has an ascertainable value at the date of the decedent's death under the federal estate tax law and regulations.
This issue is basically one of interpretation of the terms of the Will. The fundamental rule of will construction is that the intent of the testator must govern, such intent is to be garnered from the four corners of the instrument, and in determining intent, the key words of the will must be interpreted in the light of their context. A frequently used testator device in a will is to provide for the setting up of a specific trust fund, i. e., a fund consisting of certain ascertainable property capable of evaluation at date of death. Such trust fund is often given to A, or A and B, or to A, B, C, etc. to pay to such beneficiary or beneficiaries their living expenses during their lifetime or lifetimes, with remainder of the balance of the fund to X charity. No real problem exists where the bequest for living expense is payable from income of the fund or corpus only, without power of the trustees or a beneficiary to invade the corpus for the payment of any bequest since the corpus remains intact and has ascertainable value of its assets.
The problem both as to the charitable remainder beneficiary and the Government for purposes of estate taxation arises only when the beneficiary, single or plural, or the trustees on behalf of such beneficiary or beneficiaries, have a power to invade the corpus. Neither the named charitable beneficiary or the Government can be certain that there will be anything of value left in the estate to pass on or be transmitted to the charitable beneficiary after the death of the life legatee.
Over the years, federal case law has developed which sets certain standards or criteria for determining or judging whether there is or reasonably can be expected to be, an ascertainable amount of corpus left to the charitable beneficiary so as to be exempt from federal taxation.
*1152 The bellweather cases setting up a broad rule of law in determining taxation of such gifts by will are two United States Supreme Court cases, viz., Ithaca Trust Co. v. United States, 279 U.S. 151, 49 S. Ct. 291, 73 L. Ed. 647 (1929); and Merchants National Bank of Boston v. Comm. of Internal Revenue, 320 U.S. 256, 64 S. Ct. 108, 88 L. Ed. 35 (1943). As stated, these two Supreme Court cases have established what have become traditional rules of thumb in applying Section 2055 (26 U.S.C. § 2055) and its regulations to specific instruments. In the Tenth Circuit, whose decisions likewise have stare decisis effect, the Court must consider the import of United States v. Powell, 307 F.2d 821 (1962); and United States v. Commercial National Bank of Kansas City, 404 F.2d 927 (1968).
In Ithaca, the trust allowed the widow life beneficiary to withdraw from the principal any amount "that may be necessary to suitably maintain her in as much comfort as she now enjoys." Justice Holmes, in allowing a charitable deduction, remarked that "the standard was fixed in fact and capable of being stated in definite terms of money. It was not left to the widow's discretion. The income of the estate at the death of the testator . . . was more than sufficient to maintain the widow as required. There was no uncertainty appreciably greater than the general uncertainty that attends human affairs."
The same Ithaca case is also noteworthy for reemphasizing the principle that in determining the amount of the charitable remainder, the amount of the standard-of-living expense must be computed on the basis of the beneficiary's life expectancy at the time of testator's death, and not on an afterknown factual basis occurring subsequent to the donor's date of death. In Ithaca, the widow, as life tenant died within a year after her husband's death and before any estate tax had been computed, and a contention was made and rejected that since it was absolutely known how much of the corpus she used or could have used, then that should be the basis for determining the remainder for charitable use for estate tax purposes.
The second Supreme Court case, Merchants National Bank of Boston v. Comm. of Internal Revenue, supra, involved a trust in which the grantor authorized the trustee to invade corpus "for the comfort, support, maintenance, and/or happiness" of his wife. The grantor stated further that "it is my wish . . . that . . . my said Trustee shall exercise its discretion with liberality to my said wife, and consider her welfare, comfort and happiness prior to claims of residuary beneficiaries under this trust." The Court denied the charitable deduction, stating that "the extent to which the principal might be used was not restricted by a fixed standard based on the widow's prior way of life." In this case, her "happiness" was among the factors to be considered by the trustee. The Court was willing to assume the unlikelihood of invasion. Nevertheless, Congress has required a more reliable measure of possible expenditures and present value than is now available for computing what the charity will receive. The salient fact is that the purposes for which the widow could, and might wish to have the funds spent, do not lend themselves to reliable prediction. This is not a "standard fixed in fact and capable of being stated in definite terms of money." Introducing the element of the widow's happiness and instructing the trustee to exercise its discretion with liberality to make her wishes prior to the claims of residuary beneficiaries brought into the calculation elements of speculation too large to be overcome, notwithstanding the widow's previous mode of life was modest and her own resources substantial.
In the first authoritative Tenth Circuit case of United States v. Powell, supra, the trustee was authorized to invade principal "for the maintenance, welfare, comfort or happiness" of the *1153 beneficiaries and was admonished that, before principal was invaded, he should "deem that the purpose for which the payments are to be made, justifies the reduction in the principal . . .."
The Court found "happiness" to have the same meaning as "welfare" and "comfort," which are commonly construed to impose the standard-of-living test. Merchants Bank was distinguished on the ground that there the trustee had been given a broader power of invasion, and the Tenth Circuit stated therein:
"It is clear, we think, that the court accorded such broader connotation to the word `happiness,' because of the context in which it was found and, particularly, the instructions to the trustee to exercise its discretion with liberality to the wife and to consider her welfare, comfort and happiness prior to the claims of the residuary beneficiaries."
The instrument in Powell, on the contrary, "indicated that the power should be exercised with restraint and only when the purpose justified a reduction of the corpus . . .," an interpretation fitting the context of that instrument.
This brings this Court to consideration of the very authoritative and illustrative case of United States v. Commercial National Bank of Kansas City, supra, the Tenth Circuit's second and last pronouncement on the law in this area of federal estate taxation. Here, Senior Judge Jones reviewed very thoroughly the Supreme Court cases of Ithaca and Merchants National Bank, and the previous Tenth Circuit case of United States v. Powell, distinguished all of these cases and others, and laid down certain guiding principles of will interpretation in this category of federal estate taxation cases.
In Commerical National Bank, the testator created a trust in which he gave the income to his wife and a sister of testator for their life or lives, and upon the death of the last income beneficiary, the trust estate was to be terminated and the principal distributed evenly among two charitable organizations and four of decedent's nephews. The trust empowered the trustee to invade the principal for the benefit of decedent's wife. The trustee was given sole discretion to use the principal of the trust estate to pay to decedent's wife "for her comfort, welfare, contentment and happiness . . . in order that she may continue to live in the manner in which she has been accustomed to live." Then the will admonished the trustee concerning such payments of principal to the survivor wife:
"Her enjoyment of the benefits of the Trust Estate shall be considered as paramount to the conserving of assets of said Trust Estate for the benefit of the distributees hereinafter named in paragraph 9 of this Trust Agreement (being the two charities and the four nephews)."
In Commercial National Bank, the Tenth Circuit panel summarized the same statutory law as is applicable in the instant case, as follows:
"Int.Rev.Code of 1954, § 2055(a)(2) allows a deduction from a decedent's gross estate in the amount of transfers to charitable organizations. Treas.Reg. § 20.2055-2(a) covers situations where the charitable transfer consists of a remainder interest with the intervening life estate belonging to a noncharitable beneficiary. This regulation states that a `deduction may be taken of the value of the charitable beneficial interest only insofar as that interest is presently ascertainable, and hence severable from the noncharitable interest. . . . Thus, if money or property is placed in trust to pay the income to an individual during his life . . . and then to pay the principal to a charitable organization, the present value of the remainder is deductible.' Where a trustee has a power to divert the principal to a noncharitable use, `the deduction will be limited to that portion, if any, of the property or fund which *1154 is exempt from an exercise of the power.'"
From Judge Jones, speaking for the Tenth Circuit in that case and other federal cases, one can summarize the criteria of judicial judgment distilled from the federal court cases of the Supreme Court and various circuits, as follows:
First, for a charitable remainder subject to invasion to be deductible, it must first be established that the instrument contains an ascertainable standard of invasion by a life beneficiary, i. e., one which is capable of being stated in definite terms of money.
Second, in all cases allowing the deduction, this ascertainable standard has been the standard-of-living criterion, either expressly stated or implied from the language of the instrument. If no such standard exists, the charitable deduction is denied, no matter how remote the possibility of invasion might be. If the instrument contains such a standard, then the Court will later have to determine the likelihood of invasion.
Third, the time of measurement or ascertainment of the standard of invasion, as well as the later determination of the likelihood of invasion if necessary, is at or as of the date of the testator's death, and not by after-occurring known facts.
Fourth, in determining whether an ascertainable standard of invasion exists, the language of the instrument under scrutiny must be interpreted in conformity with state law, citing Blodget v. Delaney, 201 F.2d 589 (1st Cir. 1953).
Fifth, where an instrument contains a standard-of-living clause in one place in the instrument that seems to meet the requirements of definiteness and at a later place language that seems to enlarge or open the doors of largess that is, it contains both a narrow and a broad standard of invasion, then the instrument must be treated as permitting invasion to the extent of the broader standard. Stated differently, the broad or indefinite standard establishes the outer limit of invasion, not the narrow or definite one. See Union Trust Co. v. Tomlinson, 355 F.2d 40 (5th Cir. 1966); and State Street Bank & Trust Co. v. United States, 313 F.2d 29 (1st Cir. 1963).
Sixth, and finally, if it is determined by the Court, as interpreter, that an ascertainable standard of invasion of the corpus does exist, then the Court will determine the likelihood of invasion. If invasion is likely, the estate whose federal estate tax liability is before the Court, would have to be sent back to Internal Revenue, as the administrative arm of Government, for a determination of the taxable and nontaxable portions of the bequest, unless such a conclusion is clear in the evidence before the Court. On the other hand, if a determination is made that invasion of the corpus is unlikely, then presumably it would go back to Internal Revenue for allowance of the entire unusable principal as a legitimate charitable deduction, unless the evidence before the Court supplies the correct answer.
Having reviewed the law of this decision, and the basic criteria for judgment of the Court, the Court now turns to analysis of the Palmer Will to determine the basic tenet of will construction, viz., the intent of the testator.
There is no legal or taxable question extant in the first seven paragraphs of the Palmer Will which provide for specific legacies. Paragraph EIGHTH deals with the residue of the estate and directs that one-half of the residue be set up as Trust "A", in which the net income thereof is bequeathed to testator's wife, Daisye Palmer, along with the power in the wife, exercisable either during her lifetime or by her will, to dispose of the entire corpus of Trust "A". If she failed to use the corpus or dispose of it by will, provision was made for that property to go to and fall into Trust "B". The widow has since exercised *1155 her power of disposal of the assets in Trust "A".
Trust "B" was created by paragraph EIGHTH with the remaining one-half of the residue of testator's property. It is with Trust "B" that the remaining issue in this law suit arises. See Finding of Fact No. 3 for exact context. To summarize, however, Part B-2 gave the net income of the trust as follows: $600.00 per month to testator's daughter, Eileen Palmer Courtney, now Hipps, during her lifetime; the remainder of such income to testator's wife Daisye during her lifetime. Part B-3, because it is the crucial clause, is quoted as follows:
"3. I direct that my Trustees shall pay to or expend for the use or benefit of my grandson, John Thomas Courtney, all necessary funds to pay any medical and hospital expenses by him incurred, and to provide for the care, comfort, maintenance, support and general welfare of my said grandson during his life time, and at the time of his death provide adequate funeral and burial services. While it is my desire that the Trustees liberally provide for my grandson, said Trustees shall, in their sole discretion, determine and conclude, from time to time, the extent and amount of care, support and maintenance expenditures from said trust estate."
Part B-4 provides that after the deaths of testator's wife Daisye, his daughter, Eileen Palmer Courtney (Hipps), and his grandson, John Thomas Courtney, the remainder of Trust "B" should be disposed of as follows:
(a) Certain described real estate is specifically devised to Hugh S. Edgerton and to Jeff C. Lyle;
(b) The remainder of said trust funds to be paid and distributed to a charitable and educational corporate foundation, designated as "The Ella Palmer Foundation."
The precise legal issue of this law suit is the calculable amount of assets, if any, which this charitable foundation will receive.
Paragraph NINTH of the Will deals with various powers of the trustees of the two Trusts "A" and "B", giving them virtually a free hand in the management, control and sale of assets with certain specific exceptions not germane to this law suit. Again, however, Paragraph NINTH (d) is of such significance to the interpretation here made that it is set forth verbatim:
"(d) I hereby authorize my said Trustees, irrespective of the provisions for the distribution of my said trust estates, to at any and all times pay from either the income or corpus of these trust estates to any of the beneficiaries hereinabove named or designated, such sum or sums of money as in the opinion and sole discretion of said Trustees shall be deemed necessary, advisable and requisite for their maintenance, support, care and health. Should any payment be made under this provision to any such person, the same shall be charged as an advancement to the share of such person in such trust estates, if such person's interest therein is that of an ultimate beneficiary."
No other provisions of the Palmer Will are material for the purposes of this decision.
The Court first examines and refers to the provision of Paragraph NINTH (d) quoted above. Indisputably, it refers only to the property or assets covered by the Trusts "A" and "B" set up in paragraph EIGHTH. Indisputably, likewise, it covers only beneficiaries mentioned there, viz., the testator's wife Daisye, his daughter Eileen, his grandson John Thomas Courtney, and the specific devisees, Edgerton and Lyle. By its provisions, NINTH (d) allows the payment to these beneficiaries by the *1156 trustees from corpus "such sum or sums of money as in the opinion and sole discretion of the trustees shall be deemed necessary, advisable and requisite for their maintenance, support, care and health." This particular language is the standard verbiage approved in Ithaca and its progency, and obviously provides a calculable standard should there be likelihood of distribution. For the purposes of this decision, it can be said it provides nothing additional for either the wife Daisye or the grandson John Thomas Courtney, the likelihood being nil that Daisye would require any more, and the fact that Courtney was previously given the same grant, with more liberal terms, in Paragraph EIGHTH B-3. As to the daughter Eileen, it enlarges her EIGHTH B-2(a) bequest into a standard-of-living bequest clearly calculable under Ithaca. Relative to Edgerton and Lyle, it may be an enlargement of the specific devise to them in EIGHTH B-4(a) to a standard-of-living bequest, again calculable under Ithaca, but extremely unlikely of realization because NINTH (d) provides any payments for living expense shall be considered an advancement or charge against the value of their ultimate vested remainder interest in the described real estate, obviously a very valuable estate asset whose one-half value as to each Edgerton and Lyle would have to be exceeded before any invasion of corpus could occur.
This brings the Court to consideration of the bequest to the grandson John Thomas Courtney in EIGHTH B-3, which has been the real center of controversy in this case. The Court has determined that the overall intent of this paragraph was to provide only a standard-of-living bequest to Courtney. Of course, all necessary funds for medical and hospital expense normally would fall within and be encompassed by a care-comfortmaintenance grant. The key words of the bequest to Courtney are to provide for the "care, comfort, maintenance, support and general welfare of my said grandson during his lifetime." The only words there which might suggest enlargement over standard-of-living are "comfort" and "general welfare." The Government would have the Court equate these with the frowned-on word "happiness." I do not do so. To the Court, "comfort" and "general welfare" are consistent with standard-of-living and were intended by the testator to be synonymous with and equivalent to "care," "maintenance," and "support."
Again, the Government contends the words "liberally provide for my grandson" constitutes an enlargement of the calculable standard-of-living measurement, and hence poisonous to the plaintiff's tax contentions. Again, the Court disagrees. The words following that phrase indicate an intention of the testator to rely on the sole judgment of the trustees as to the amount of care, support and maintenance expenditures. Neither does the Palmer Will as to Courtney or any other individual trust beneficiary indicate that decedent Palmer was more interested in the expenditures being made generously by the trustees for such beneficiaries than in conserving the estate for the charitable purposes provided in EIGHTH B-4(b).
It should be noted that in virtually all of the federal cases cited in the Government's brief and those which have come to the attention of this Court where the standard of invasion has been held to be nebulous, speculative or incalculable, all contained verbiage more than is in this Will, which indicated the testator's clear intent to enlarge on the standard-of-living norm sanctioned by Ithaca. Certainly, such elastic language was apparent in Merchants National Bank (combination of expressions of "happiness," "liberally," and "her . . . happiness prior to claims" of charitable beneficiaries); and in Commercial National Bank (combination of "happiness of wife," and admonition that her enjoyment of benefits be considered "paramount" to that of charitable beneficiaries).
*1157 One of the Government's arguments in its brief designed to show the incalculable amount of living expense which the grandson Courtney might require, is that Courtney was only eighteen years of age at date of death of decedent, and had been injured severely. The claim is that a permanent fixed lifestyle had not yet been established and that because of some serious or permanent injury the expense requirement would be more and hence speculative. Both arguments are highly specious in the Court's opinion and inject two factors which no court has as yet required, i. e., that a donee must reach a certain age to attain a life style, and that he must be physically and mentally healthy and without bodily handicap. Not so. If standard-of-living as laid down by Ithaca is a norm, it must be applied equally through statistical formula to young, middle-aged and old alike, as well as to the healthy and sound vis-a-vis the unhealthy and handicapped. If the law is to apply equally, standard-of-living can be as calculable for the infant as the octogenarian through abundant data available from private and governmental sources on cost-of-living for income groups. Few wills, if any, contain lifestyle data on the beneficiaries. Usually only their name, relation and admonition as to maintaining them in their customary standard-of-living fashion is set forth. The data on a donee's customary standard-of-living must always be ascertained and is ascertainable from facts outside the will. However, extrinsic facts, such as the financial circumstances of a life beneficiary, though relevant to the remoteness of invasion, are irrelevant to whether the charitable interest is presently ascertainable. See Seubert v. Shaughnessy, 233 F.2d 134 (2nd Cir. 1956).
One other contention is made by the Government in its post-trial brief which needs comment by the Court. It is argued by the Government that the broad powers given to the trustees in paragraph NINTH of the Will to sell, convey, dispose . . . invest and reinvest the assets of the trust, much of which was oil and gas properties, and the added power to pay estate expenses from either income or principal make it speculative what assets might eventually remain in Trust "B". Without going into detail, suffice it to say this is an untenable argument. The purpose of the provisions was to give the competent trustees full and flexible power to manage the assets to enlarge and not diminish the estate. This is emphasized in the last sentence of paragraph NINTH (a), where it is stated:
"In making investments or reinvestments other than otherwise herein provided, said Trustees shall buy only such property as may be within the standards for investments by fiduciaries in the State of Kansas, as in the exercise of the Trustees' sound judgment shall be proper investment for trust funds."
Paragraph NINTH (6) went on to restrict the trustees' power of sale or disposal of certain specifically named property in the estate.
Furthermore, as pointed out in Powell, under Kansas law, a court of equity has power to review exercise of discretionary powers conferred on trustees, and to correct any abuse in exercise of such discretion. It is to be further noted that in Powell, the Tenth Circuit held broad powers of investment and control of trust assets as not giving trustees power to alter or amend the corpus within the prohibited provisions of the Internal Revenue Code.
Having first determined that the standards provided by this Will are sufficiently fixed, objective and measurable under the language of the testator, it is required that the Court make a determination as to the likelihood of invasion. The Court has no problem, of course, with the wife, Daisye Palmer, knowing she has the property of Trust "A", both as to principal and income as well as a *1158 substantial amount of the income from the properties constituting Trust "B". As to the remaining beneficiaries, the daughter Eileen Courtney Hipps, the grandson John Thomas Courtney, and the two specific devisees, Edgerton and Lyle, there is no evidence before the Court upon which a valid determination may be made as to the probable amount of invasion of the corpus of Trust "B" during each of their respective lifetimes. Therefore, it becomes necessary that this aspect of the case be remanded to Internal Revenue Service for an administrative determination to be made of the amount of necessary corpus for the care, support, and maintenance of Eileen Courtney Hipps during her life expectancy, and of the grandson John Thomas Courtney during his life expectancy.
In determining the amount the daughter Eileen Courtney Hipps might reasonably take from the corpus of Trust "B", the amount of her $600.00 monthly legacy from the income of Trust "B" would have to be taken into consideration, as well as the first Probate Court determination of standard-of-living as set forth in Conclusion of Law No. 4.
As to administrative determination of the probable deletion of corpus for John Thomas Courtney during his life expectancy, it would appear logical to require exhaustion of his known resources of $125,000.00, as found in Finding of Fact No. 9, by subtracting that amount from a total life expectancy sum. Unfortunately, and contrary to the belief and assertion of the plaintiffs in their briefs, Internal Revenue must make this on lifestyle or standard-of-living evidence as to both of them which was available at testator's date of death. It certainly appears at this time nine years after decedent's death in the light of transpiring events including the now-known renunciation by stipulation of the widow dated March 9, 1972, that the income of Trust "B" would easily take care of the living needs of both Eileen Courtney Hipps and John Thomas Courtney. However, this disclaimer by the widow, occurring as it did after the date prescribed for filing the Palmer Estate tax return, may not be taken into consideration by the Internal Revenue Service or a court in making computations of probable deletion from corpus by Hipps and Courtney.
Furthermore, while it is possible that had evidence been introduced before this Court relative to the financial circumstances of both Edgerton and Lyle, this Court could have found no likelihood of invasion of the corpus of Trust "B" on either of their behalfs, no such evidence was proffered. Hence, it will now be incumbent for either Internal Revenue Service to hear such evidence in this regard, or for this Court to reopen the evidentiary phase of this case to do so. For the purposes of terminating this litigation, the Court chooses to now refer this matter to the Internal Revenue Service for determination. Some loose language in plaintiffs' brief would indicate that the value of the devise to Edgerton and Lyle was worth $300,000.00. However, a copy of a State Inheritance Tax Return before the Court ex judicio indicates the total appraised value of the described real estate devised to be $315,000.00, while the value of the vested remainder interest of each Edgerton and Lyle after the deaths of the three life tenants, was appraised at approximately $31,000.00 each. Such sum is not inordinately large so as to provide instant and perpetual wealth in itself. Therefore, it would appear there is a possibility of invasion of the corpus by Edgerton or Lyle, or both, unless the financial circumstances of each is such as would likely preclude any intrusion into the corpus of Trust "B" over and above the value of the remainder interest of each which is to be offset against any advances from corpus. Here, again, if the financial situation of either Edgerton or Lyle was precarious at testator's death as to indicate probability of aid and succor, then Internal Revenue Service *1159 would necessarily be required to compute the amount of invasion for standard-of-living during life expectancy.
In sum, then, the Court believes that some of the contentions on both sides have been erroneous. The estate may not have its charitable deduction, as claimed, by viewing events in the light of facts occurring after death of the testator. The Government may not impose its estate taxes on its version of the facts or the law. Even though under circumstances now known, it would appear the whole corpus may very well, in fact, go to the charitable foundation, the Government, on behalf of the people of the United States, may exact a tax based on facts known at the date of death.
It is therefore ordered that judgment be hereby entered for the plaintiffs and against the defendant on the remaining legal issue, i. e., holding that the Will of Tom Palmer does create a charitable remainder interest which has an ascertainable value at the date of decedent's death under the federal estate tax law and regulations.
It is further ordered that the federal estate tax assessment or computation due from the Tom Palmer Estate, be remanded back to the Internal Revenue Service of the United States, Department of the Treasury, for final determination of federal estate tax due in accordance with the Court's Findings of Fact and Conclusions of Law, and views set forth in the Opinion of the Court.
It is further ordered that after either the Internal Revenue Service has made its tax computation as directed, or that the parties have agreed upon the amount of such final tax liability, then the parties shall submit a final journal entry of judgment to the Court for consideration and approval, if such computation is not claimed to have been arbitrarily or capriciously made, and for final resolution of this litigation. All costs accruing herein shall be taxed against the defendant. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552439/ | 243 B.R. 666 (1999)
In re Chuck KANG, Debtor.
Bankruptcy No. 398-36547-SAF-13.
United States Bankruptcy Court, N.D. Texas, Dallas Division.
February 9, 1999.
*667 Greg Gutman, Dallas, TX, for Movants, HKT Management Co. and First International Bank.
Herman A. Lusky, Dallas, TX, for Debtor.
MEMORANDUM OPINION AND ORDER
STEVEN A. FELSENTHAL, Bankruptcy Judge.
HKT Management Company and First International Bank move the court to dismiss *668 this Chapter 13 case and object to the debtor's claim of a business homestead. The court conducted an evidentiary hearing on these matters on December 10, 1998. Following the hearing, the parties engaged in discussions to address the creditors' grounds for dismissal. The debtor, Charles Kang, has informed the court that he intends to file an amended Chapter 13 plan addressing the disclosure and disposable income issues raised by the creditors. In turn, the movants have requested that the court carry the motion to dismiss until a confirmation hearing.
Indeed, the court intimated that a confirmation hearing afforded the best means to test the debtor's good faith approach to this case. A Chapter 13 plan provides the debtor with a vehicle to remedy problems, even if created by the debtor as late as the filing of the schedules. Under 11 U.S.C. § 1325(a)(3), to be confirmed, a Chapter 13 plan must be proposed in good faith. To test the debtor's good faith, the court considers the totality of the circumstances. See In re Chaffin, 836 F.2d 215, 217 (5th Cir.1988). The issues raised by the movants may be addressed by Kang in his plan.
For example, a plan that pays creditors in full or substantially in full will remedy the problems raised by the movants. Kang has now increased his plan, in response to the issues presented by the motion to dismiss, to approximately $75,000, to be paid over 60 months. After payment of administrative expenses, Kang estimates that the amended plan will result in about $71,000 of that amount being distributed to unsecured creditors, including the movants.
In addition, as the court will address below, Kang owns a strip shopping center, in which he may have considerable equity. Whether exempt or not as a business homestead, committing that equity to his plan will assure that creditors will receive a substantial dividend, depending on the outcome of the claims allowance process. Thus, once the claims allowance process has been completed, which should coincide with confirmation, Kang may commit to sell the shopping center in the final year of his plan if the equity is needed to complete a plan paying creditors a substantial dividend.
So, with the motion to dismiss being carried to the confirmation hearing, the court turns to the exemption objection. The determination of property exempt from a bankruptcy estate constitutes a core matter over which this court has jurisdiction to enter a final order. 28 U.S.C. §§ 157(b)(2) and 1334. This memorandum opinion contains the court's findings of fact and conclusions of law. Bankruptcy Rules 7052 and 9014.
Kang owns a strip shopping center. He estimates that the equity value of his interest would be about $100,000. In the center, Kang operates a grocery or convenience store. He leased space in the center to operate a business prior to purchasing the center. He testified that he purchased the center to protect his business location. His father had also operated a business in the center. Kang personally performs maintenance and upkeep to the center. He collects the rents from the other tenants. Kang has claimed this property as a business homestead. The movants object, contending that the property is an investment and not a place of business for Kang.
Section 522(b) of the Bankruptcy Code permits a debtor to exempt property under either the federal exemptions enumerated in § 522(d), if the state authorized, or those available under state or other federal law. Texas has authorized debtors to select the federal exemptions under § 522(b)(1). And Texas has created its own list of exemptions. NCNB v. Volpe (In re Volpe), 943 F.2d 1451, 1452 (5th Cir.1991). Accordingly, Kang could elect the "federal" exemptions specified in § 522(d) or the "state" exemptions under § 522(b)(2). Kang has claimed the Texas exemptions.
*669 The Texas exemptions recognize a business homestead. V.T.C.A. Property Code § 41.001. As Fifth Circuit Chief Judge King has written:
The test under Texas law for whether property qualifies as a business homestead is a familiar one: `To preserve a place of business which is separate and distinct from the home as a part of the homestead, the head of the family must have a calling or business to which the property is adapted and reasonably necessary and such property must be used as a place to exercise the calling or business of the head of the family.'
In re Starns, 52 B.R. 405, 414 (S.D.Tex. 1985) (King, Circuit Judge, nee Randall presiding). Although Texas homestead exemption laws must be liberally construed in favor of the debtor, the scope of the business exemption cannot be extended to protect property which is only incidentally useful or profitable to the business. Id. Thus, the court must determine if the head of the family has a calling or business to which the property is adapted and reasonably necessary and, then, if the property is actually used as the place to exercise that calling or business. Mays v. Mays, 43 S.W.2d 148, 152 (Tex.Civ.App. Beaumont 1931, writ ref'd).
Kang is the head of the family. He has a business, the ownership and operation of a grocery store, more aptly described as a convenience store. Although Kang has tried other businesses, as evidenced by the movants' claims in this case, at the time of the filing of his bankruptcy petition, the store occupied his time, labor and efforts as its owner. His wife assists him, but Texas public policy encourages family efforts to improve their economic lot. Kang, even with his wife, owns or operates the store. That qualifies as a business. C.D. Shamburger Lumber Co. v. Delavan, 106 S.W.2d 351, 356 (Tex.Civ. App. Amarillo 1937, writ ref'd).
The center is adapted for use as a convenience store. Center space is reasonably necessary for the store. A portion of the center is actually used as a location for the store, owned or operated by Kang, the head of the family. Thus, the business homestead test has been met.
But the movants contend, correctly, that only a portion of the center is used for the store. Since the store could be leased, as Kang did prior to purchasing the center, or located elsewhere, and since Kang derives rental income from other center tenants, the movants contend that the center should be held to be a non-exempt investment.
Texas cases recognize that the building and renting of houses do not meet the definition of "business" as used in the Texas Constitution. Shamburger, 106 S.W.2d at 356-57; Mays, 43 S.W.2d at 152. A person could own many rent houses and yet devote his business hours, time, labor and attention to other businesses. Rather than constitute a business homestead, the building and renting of houses amounts to an investment. Shamburger, 106 S.W.2d at 357. By analogy, owning a shopping center is similar to owning rent houses. Had Kang merely purchased the shopping center, maintained it, leased space to tenants and collected rents, Texas case precedent defining a business would not recognize the center as a business homestead.
Kang, however, uses a portion of the center for his business. He actually operated a convenience store at that location at the time of the filing of his bankruptcy case. While the center has investment value for Kang, he uses part of the center for his convenience store business. Thus, Kang's use of the center is different than a person who builds or rents commercial space without maintaining a business on the premises.
Texas cases recognize that a person in the business of operating a tourist camp who owns a gasoline station and 20 cabins could exempt the entire property as a business homestead. Shamburger, 106 S.W.2d at 358. But the business of operating a tourist camp requires multiple facilities. *670 Similarly, a miller who owns a mill yard with camp houses and outhouses necessary for customer lodging could exempt the entire property as a business homestead. Id., at 357-358. But Kang's business of operating a grocery or convenience store only requires the store's premises and customer parking facilities. The business does not require the entire center.
Kang's store occupies a portion of the center. The space it occupies is essential and necessary for the business. Compare Starns, 52 B.R. at 414. But Kang's use of the remainder of the center is only incidental to Kang's primary business. If the center could be separated, part would be essential and necessary for Kang's business, and part, incidental. If on separate lots, Texas law would recognize only the store location as a business homestead. Id.
"The use made of the premises determines the question of homestead." Mays, 43 S.W.2d at 152. The owner of a business homestead may enlarge the building occupied by him in his business, with the enlarged building being exempt. "[B]ut when the owner of a business . . . erects another building on the premises, though adjoining his business house, the new building being erected for the purpose of leasing to tenants, such use is inconsistent with its exemption as the place of business, and will form no part of the business home." Id. Thus, had Kang owned a store and later constructed a shopping center around it, the center would not be exempt. The court cannot discern a public policy difference when Kang purchases the center containing his store.
Prior to Mays and Shamburger, several Texas cases allowed debtors to exempt an entire building or an entire parcel of land when only a portion had been used for the business. For example, in Cooper Grocery Co. v. Peter, 35 Tex. Civ. App. 49, 80 S.W. 108 (1904, writ ref'd), the court allowed a business homestead claimant to exempt a building which he leased to another, but continued to occupy an office therein. The claimant had a grocery business. He sold out his stock of merchandise and thereafter rented the property on a month to month basis. He maintained an office in the building for the purpose of buying cotton and taking orders for tailor-made clothing, a business he started prior to selling out his grocery merchandise. Acknowledging that the record presented a "close question of fact," the court found that the evidence did not warrant a finding that the claimant was not actually engaged in the business of buying cotton and taking orders for clothing and that he was therefore not using the premises in question for that purpose. See also, e.g., Brennan v. Fuller, 14 Tex. Civ. App. 509, 37 S.W. 641 (1896, no writ history) (business homestead not abandoned by owner of one-story brick building who rented majority of building to another but reserved an office from which he maintained his business as postmaster).
But these cases predate and are therefore affected by Mays and Shamburger. Both Mays and Shamburger recognize that owning and renting space does not, per se, constitute a business or calling for homestead purposes. Instead, the court must focus on the use made of the premises and determine whether it is reasonably necessary for the operation of a business recognized for homestead purposes or only incidental to the operation.
Based on the analysis of Texas law, Kang may exempt as his business homestead his store with necessary space for ingress and egress and customer parking. But the remainder of the property is incidental to his business, and is in the nature of an investment not considered a business under Texas law and may not be included in the business homestead.
In Texas, in the case of an urban residence located on more than one acre of land, the excess property would be subject to creditors' claims. The debtor *671 may designate the acre for his homestead. Niland v. Deason, 825 F.2d 801, 815 (5th Cir.1987); Tex. Prop.Code Ann. § 41.022 (West 1999). The excess acreage over the debtor's homestead may then be sold to satisfy the claims of creditors. Id. Tex. Prop.Code Ann. § 41.024 (West 1999). This court has found no Texas authority that would not make that principal applicable to the debtor's property in excess of a business homestead. The court appreciates that the store cannot be physically separated from the rest of the center but that does not mean that the title to the excess property cannot be conveyed. If, however, title to the excess property cannot be conveyed because of applicable nonbankruptcy law, Texas law permits the sale of the property, with a portion of the proceeds allocated to the homestead and a portion to the excess. See, McSwain "The Texas Business Homestead in 1990," 42 Baylor L.Rev. 657, 673-74 (1990).
Unless the debtor commits to selling the property if necessary to confirm a Chapter 13 plan, the debtor must designate the portion of his property primarily used and reasonably necessary for his store. That portion will be recognized as his business homestead. The excess property shall be available for creditors' claims. The debtor shall file his designation within 60 days of the date of entry of this order. Parties in interest shall have 30 days to object to the designation. In the absence of an objection, the designation shall be recognized as the business homestead. In the event of an objection, the court will conduct a further evidentiary hearing to determine the exemption.
The court appreciates that a forced sale of the excess property may adversely affect the value of the property. See e.g. In re Tinsley, 217 B.R. 188 (Bankr.N.D.Tex. 1997). Actual use of the property, not impact on market value, however, informs the business homestead determination.
This decision recognizes the Texas constitutional policy to protect a debtor's business homestead without impairing the legitimate claims of creditors to that portion of the debtor's property not primarily used or reasonably necessary for that business. Permitting the debtor to exempt the entire strip shopping center would lead inevitably to exemptions for multistory commercial buildings and hotels owned by debtors who operate a small retail operation qualifying as a business for Texas homestead purposes on the premises. That would undermine the Texas decisions that exclude building and leasing property from a business for business homestead purposes and result in an unseemly windfall for debtors.
Based on the foregoing,
IT IS ORDERED that the objection to the business homestead is OVERRULED in part and SUSTAINED in part and the homestead is ALLOWED as provided in the above memorandum opinion.
IT IS FURTHER ORDERED that the motion to dismiss is carried to the hearing on the confirmation of the debtor's Chapter 13 plan of reorganization. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1552401/ | 239 B.R. 213 (1999)
In re Carol Douglas MUIR, Debtor.
Carol Douglas Muir, Plaintiff,
v.
Sallie Mae Servicing Corporation, and New York State Higher Education Services Corporation, Defendants.
Bankruptcy No. 98-33267-7. Adversary No. 99/00022.
United States Bankruptcy Court, D. Montana, Butte Division.
September 17, 1999.
*214 *215 Bruce M. Wilson, Missoula, MT, for the plaintiff.
Kathleen C. McBride, Corette Pohlman & Kebe, Butte, MT, for the defendant.
ORDER
JOHN L. PETERSON, Bankruptcy Judge.
In this adversary proceeding the Defendant New York State Higher Education Services Corporation ("NYSHESC") filed a motion to dismiss complaint on August 5, 1999, on the grounds this Court lacks subject matter jurisdiction or lacks jurisdiction over NYSHESC under Rule 7012 (applying Fed.R.Civ.P. 12(b)(1) & (2) in adversary proceedings) due to the State of New York's Eleventh Amendment sovereign immunity.[1] The Plaintiff has filed objections, and the parties have each submitted briefs. Trial of this cause is scheduled at Missoula on October 12, 1999. For the reasons set forth below, NYSHESC's motion to dismiss complaint is denied.
BACKGROUND
The Debtor/Plaintiff filed a voluntary Chapter 7 petition on November 9, 1998. Her Schedule F lists student loan debts owed to Sallie Mae Servicing Corp. ("Sallie Mae") in the sum of $53,518.00. The Clerk of the Bankruptcy Court mailed a notice of commencement of the case to the creditors, including Sallie Mae, on November 22, 1998. On March 4, 1999, the Debtor commenced this adversary proceeding against the United States of America, Department of Education ("DOE"), Sallie Mae, and Portland State University ("PSU"), seeking a determination that the Debtor's student loans are dischargeable under 11 U.S.C. § 523(a)(8) because excepting such debts will impose an undue hardship on the Debtor. A Discharge of Debtor was entered in Case No. 98-33267-7 on March 9, 1999, and served upon Sallie Mae. The Trustee filed a no-asset report on March 10, 1999.
On April 26, 1999, the DOE notified the Court that it had no interest in the matter since the Debtor owed it no student loans. The United States and PSU were each dismissed by Order entered May 13, 1999. The Debtor moved to join NYSHESC on May 19, 1999, on the grounds Sallie Mae had filed an insurance claim of the Debtor's student loans with NYSHESC, *216 and NYSHESC paid such claim and purchased the student loans, according to its reply brief, on or about April 10, 1999. The Court granted Debtor's motion and joined NYSHESC. Debtor filed an amended complaint seeking a determination that her student loan debts owed to Sallie Mae which was transferred to NYSHESC are dischargeable under § 523(a)(8). NYSHESC filed an answer and a motion to dismiss. NYSHESC's answer admits paragraph 1 of the amended complaint which states: "This is a core proceeding pursuant to 28 U.S.C. § 157[b](2)[I], and this court has jurisdiction to hear and determine this case pursuant to 28 U.S.C. § 1334." Later in its answer, however, NYSHESC contends the Court lacks subject matter jurisdiction since it is an agency of the State of New York and is immune from suit in federal court by a private citizen under the Eleventh Amendment.
NYSHESC filed a motion to dismiss, supporting brief, and reply brief contending that the State of New York's Eleventh Amendment sovereign immunity deprives this Court of jurisdiction over it, and that it has not waived its sovereign immunity. The Plaintiff filed a brief in opposition, arguing that NYSHESC consented to jurisdiction and waived sovereign immunity by purchasing the Plaintiff's loan from Sallie Mae with knowledge of the pending § 523(a)(8) dischargeability proceedings.
DISCUSSION
Eleventh Amendment immunity proscribes federal jurisdiction over non-consenting states. In re Mueller, 211 B.R. 737, 739 (Bankr.Mont.1997); quoting Seminole Tribe of Florida v. Florida, 517 U.S. 44, 116 S. Ct. 1114, 134 L. Ed. 2d 252 (1996). This Court has already held that Congress has no authority under the Bankruptcy Clause of the United States Constitution art. I, § 8, cl. 4 to abrogate state sovereign immunity in federal courts, and that 11 U.S.C. § 106(a) is void as unconstitutional. See, In re Mueller, 211 B.R. 737, 740-41 (Bankr.D.Mont.1997). On the other hand, sovereign immunity does not bar all judicial review of sate compliance with the Constitution and valid federal law. Alden v. Maine, 527 U.S. ___, 119 S. Ct. 2240, 2266-67, 144 L. Ed. 2d 636 (1999). Sovereign immunity is limited by States' consent to suit, either pursuant to the plan of the Constitutional Convention or subsequent amendments, specifically the Fourteenth Amendment, § 5 which is not applicable in the instant case. Id. In addition to consent, sovereign immunity is not a bar to suits prosecuted against a municipal corporation "or other government entity which is not an arm of the State." Alden v. Maine, 119 S.Ct. at 2267. Further, sovereign immunity does not bar certain actions for injunctive or declaratory relief against a state officer in his individual capacity for unconstitutional or wrongful conduct attributable to the officer, so long as relief is sought from the officer personally and not from the state treasury. Alden v. Maine, 119 S.Ct. at 2267-68; Ex parte Young, 209 U.S. 123, 28 S. Ct. 441, 52 L. Ed. 714 (1908). "[C]ertain suits for declaratory or injunctive relief against state officers must therefore be permitted if the Constitution is to remain the supreme law of the land." Alden v. Maine, 119 S.Ct. at 2263 (construing Ex parte Young).
In Mueller, this Court noted that it falls upon a plaintiff suing a nonconsenting State to establish that the state's sovereign immunity does not preclude the federal court's jurisdiction. However, NYSHESC has skipped a preliminary step in asserting sovereign immunity. NYSHESC is not the State of New York. It is a separate entity, a corporation established under the laws of the State of New York. N.Y. Educ. § 652. The State of New York is not a named Defendant in this adversary proceeding. In the Ninth Circuit, in order to establish that NYSHESC is an "arm of the state" entitled to Eleventh Amendment immunity, NYSHESC has the *217 burden of proving the facts that establish its immunity. ITSI TV Productions v. Agricultural Associations, 3 F.3d 1289, 1292 (9th Cir.1993).
NYSHESC was established for the purpose of participation in federal guaranteed student loan programs as a "guaranty agency", which is defined as a State or private nonprofit organization that has an agreement with the Education Secretary to administer a federal loan guarantee program. 34 C.F.R. Ch. VI, § 682.200(b). NYSHESC was empowered to lend money, guarantee student loans and to enter into cooperative agreements with the federal government to administer and operate federal student loan aid programs. NY Educ. § 652(2); NY Educ. § 680(1).
The test the Ninth Circuit uses in evaluating NYSHESC's claim that it is an "arm of the state" includes five (5) factors: (1) whether a money judgment would be satisfied out of state funds; (2) whether the entity performs central governmental functions; (3) whether the entity may sue or be sued; (4) whether the entity has power to take property in its own name or only the name of the state; and (5) the corporate status of the entity. ITSI TV Productions v. Agricultural Associations, 3 F.3d at 1292; Doe v. Lawrence Livermore National Laboratory, 131 F.3d 836, 839 (9th Cir.1997). In determining these factors, the Court looks to the way state law treats the entity. ITSI TV Productions v. Agricultural Associations, 3 F.3d at 1292.
In the instant case neither NYSHESC nor the Plaintiff has addressed any of these factors. The record is inadequate to undertake a full evaluation of the five factors, and thus NYSHESC's motion to dismiss is denied, although NYSHESC may raise its Eleventh Amendment immunity at any time even for the first time on appeal. In re Mitchell, 222 B.R. 877, 885 (9th Cir. BAP 1998). If it raises sovereign immunity again, NYSHESC must satisfy the five-factor ITSI TV Productions v. Agricultural Associations test.
At first glance, several of the factors suggest against a finding that NYSHESC is an arm of the state. Since it is in the business of lending money and guaranteeing student loans pursuant to a program established under federal law, NYSHESC can hardly be argued to be performing "central governmental functions" such as collecting taxes, operating the legislative, judicial and executive branches of state government, and maintaining roads. ITSI TV Productions v. Agricultural Associations, 3 F.3d at 1293.
NYSHESC is empowered to sue and be sued in the name of the corporation pursuant to N.Y. Educ. § 653(4), although by itself a state's intention to "sue and be sued" does not constitute a clear and unequivocal declaration of waiver of its sovereign immunity. College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board ("College Savings Bank"), ___ U.S. ___, 119 S. Ct. 2219, 2226, 144 L. Ed. 2d 605 (1999) (Overruling Parden v. Terminal Ry. of Ala. Docks Dept., 377 U.S. 184, 84 S. Ct. 1207, 12 L. Ed. 2d 233 (1964), and rejecting the theory of constructive or implied waiver of state sovereign immunity. College Savings Bank, 119 S.Ct. at 2227, 2229.).
The fourth factor is whether NYSHESC has power to take property in its own name or only the name of the state. NYSHESC has the power and duty "to take, hold, and preserve, on behalf of the corporation all moneys appropriated to the corporation or otherwise available to it." NY Educ. § 653(1) (emphasis added). For the fifth factor, NYSHESC is a corporation, albeit an educational corporation in the State Education Department and within the University of the State of New York. N.Y. Educ. § 652(1).
The first factor, whether a money judgment would be satisfied out of state funds, is the most important factor. *218 ITSI TV Productions v. Agricultural Associations, 3 F.3d at 1292; Durning v. Citibank, N.A. ("Durning"), 950 F.2d 1419, 1424 (9th Cir.1991). It is the entity's legal liability that is relevant, even though a judgment may have no impact upon the state treasury. Regents of the University of California v. Doe, 519 U.S. 425, 431, 117 S. Ct. 900, 904, 137 L. Ed. 2d 55 (1997); In re Mitchell, 222 B.R. at 884. Given the incomplete record at this stage of this proceedings, this first factor remains undetermined and NYSHESC has not satisfied its burden of showing it is an arm of the state entitled to Eleventh Amendment immunity.
The Plaintiff does not seek a money judgment against NYSHESC or the State of New York. Her prayer does not seek attorney's fees, or any relief other than a determination that her student loan debts are dischargeable because excepting them from discharge would be an undue hardship upon her under § 523(a)(8). While several courts have concluded that the Eleventh Amendment extends to suits for declaratory relief as well as to money damages, In re Mitchell, 222 B.R. at 884, that does not equate to a conclusion that the State of New York would have a legal liability to pay a judgment against NYSHESC. See ITSI TV Productions v. Agricultural Associations, 3 F.3d at 1293 n. 3 "([T]he mere possibility that state funds might be used to pay a judgment is of no independent significance: `The relevant question is whether the state would have a legal liability to pay the judgment, not whether the defendant entity would have the practical ability to pay it.)'" (quoting Durning, 950 F.2d at 1424 n. 2) (Emphasis in original)).
The court concluded in ITSI TV Productions v. Agricultural Associations that the California State Fair and Exposition ("Cal Expo") was not an arm of the State of California because its funds are derived from its own activities or allocation from special revenue funds, and there appeared no obligation on the part of the state to pay debts of a special fund agency even though other statutes required funds must be appropriated to pay judgments against the State. 3 F.3d at 1292-93 & n. 2 & 3. The Ninth Circuit wrote: "The critical question is whether, in the event of a judgment against Cal Expo, `the state treasury would also be legally pledged to satisfy the obligation.' Durning, 950 F.2d at 1424." ITSI TV Productions v. Agricultural Associations 3 F.3d at 1293. There was no showing in ITSI TV Productions v. Agricultural Associations that the state treasury would be legally pledged to satisfy an obligation in the event of a judgment against Cal Expo judgment in this adversary proceeding.
Similarly, in Durning the court concluded the Wyoming Community Development Authority (the "Authority") was not an arm of the state entitled to sovereign immunity under the Eleventh Amendment because of its separate corporate status, its power to contract in its own name, its power to sue and be sued, and its bond issuing powers which fund a special fund. See, 950 F.2d at 1424-1428. In light of the detailed analyses in ITSI TV Productions v. Agricultural Associations and Durning, the Court must deny NYSHESC's motion to dismiss because it has not satisfied its burden of showing that it is an arm of the state entitled to Eleventh Amendment sovereign immunity. Eleventh Amendment immunity does not extend to suit prosecuted against a government entity which is not an arm of the State. Alden v. Maine, 119 S.Ct. at 2267.
Even if NYSHESC satisfies its burden and is entitled to sovereign immunity, it does not automatically follow that this Court is divested of jurisdiction to hear and decide this matter. There is no dispute that on the date the Debtor filed her complaint in this adversary proceeding on March 4, 1999, Sallie Mae was the creditor with a claim consisting of the Debtor's student loans. Debtor's attorney served the summons and complaint upon Sallie Mae on March 7, 1999.
*219 Neither Sallie Mae nor NYSHESC has filed a claim in this case. Sallie Mae was specifically directed not to file a claim until told to do so by the notice of bankruptcy filing served upon it November 22, 1998. Allowance of claims is governed by 11 U.S.C. § 502(b), which specifies that a claim is allowed in an amount "as of the date of the filing of the petition". This section makes it clear that the petition date establishes the right to allowance of a claim. "Debt" is defined as "liability on a claim". 11 U.S.C. § 101(12). "Creditor" means "(A) entity that has a claim against the debtor that arose at the time of or before the order for relief concerning the debtor." It is not disputed that Sallie Mae had a claim against the Debtor that arose before the petition date for student loans. F.R.B.P. 3001(e) provides for a transferee of a claim other than for security to file a proof of claim, which NYSHESC has declined to do in order to preserve its sovereign immunity. See Gardner v. New Jersey, 329 U.S. 565, 573, 67 S. Ct. 467, 91 L. Ed. 504 (1947).
NYSHESC admits purchasing the loan from Sallie Mae on April 10, 1999, as it was required to do under federal regulation 34 C.F.R. § 682.402(h), which required NYSHESC to purchase the claim from Sallie Mae because of the Debtor's bankruptcy case. NYSHESC contends that this requirement under federal regulations defeats Debtor's contention that it voluntary waived its sovereign immunity by stepping into Sallie Mae's shoes when it purchased the student loan claims. After the Supreme Court's decision in College Savings Bank overruling constructive waiver in sovereign immunity cases, the Court agrees that implied waiver does not appear applicable in this case based upon NYSHESC's purchase of the claim from Sallie Mae:
[T]here is little reason to assume actual consent based upon the State's mere presence in a field subject to congressional regulation. There is a fundamental difference between a State's expressing unequivocally that it waives its immunity, and Congress's expressing unequivocally its intention that if the State takes certain action it shall be deemed to have waived that immunity. In the latter situation, the most that can be said with certainty is that the State has been put on notice that Congress intends to subject it to suits brought by individuals. That is very far from concluding that the State made an "altogether voluntary" decision to waive its immunity.
College Savings Bank, 119 S.Ct. at 2228.
On the other hand, NYSHESC has additional obligations under the same federal regulations which it argues required it to purchase the student loans from Sallie Mae. Joseph Bradley filed an affidavit in support of NYSHESC's motion to dismiss, in which he contends he is responsible to ensure that NYSHESC complies "with all statutes and regulations which govern" the federal student loan program. Bradley Affid. p. 2. NYSHESC cannot persuasively argue that it is required by federal regulations to purchase the loan from Sallie Mae, but is not required to comply with other related regulations. Sovereign immunity does not allow a State to disregard the Constitution or valid federal laws. Alden v. Maine, 119 S.Ct. at 2266-67; In re NVR, 1999 WL 486614 *7 (4th Cir.1999) ("The Eleventh Amendment, of course, does not free Maryland from federal law, but simply the jurisdiction of federal courts."). Yet, that is what NYSHESC is attempting to do in seeking dismissal of this adversary proceeding on the basis of Eleventh Amendment, rather than performing its duties as a guaranty agency according to the same federal regulations it relies upon to explain its post-petition purchase from Sallie Mae of Debtor's student loan debt.
34 C.F.R. § 682.402(i)(1) requires NYSHESC, as guaranty agency in a bankruptcy case in which a debtor seeks *220 discharge of student loans on grounds of undue hardship under § 523(a)(8), to "determine on the basis of reasonably available information. . . (B) Whether repayment ... would impose an undue hardship on the borrower and his or her dependents." After such determination, the guaranty agency is to undertake a cost/benefit analysis of opposing such a dischargeability proceeding and, if the agency determines repayment would not constitute an undue hardship and the costs of opposing dischargeability do not exceed one-third of the total debt owed[2], the agency "shall" oppose the borrower's petition for dischargeability. § 682.402(i)(1)(B).
Instead of participating in this adversary proceeding as it is required to do under § 682.402(i)(1)(B), NYSHESC seeks dismissal on the grounds of Eleventh Amendment immunity. The regulations set forth a specific course of action for guaranty agency to take in opposing a dischargeability proceeding under § 523(a)(8), and they do not include the shortcut NYSHESC seeks via Eleventh Amendment immunity. NYSHESC's argument that it purchased the loan from Sallie Mae because the regulations so required is undercut by its selective view of its obligations under federal law.
NYSHESC asserts sovereign immunity as its sole ground for dismissing the entire complaint, even though the Plaintiff initiated the adversary proceeding against, among others, Sallie Mae. Sallie Mae has not appeared, and has not asserted, nor is it entitled to assert, the State of New York's Eleventh Amendment sovereign immunity. NYSHESC contends that this Court lacks jurisdiction "to entertain the Plaintiff's adversary proceeding Complaint against NYSHESC, and this adversary complaint seeking the discharge of the Plaintiff's student loan should be dismissed" due to its sovereign immunity. However, even if NYSHESC's sovereign immunity argument is valid, that is not necessarily reason to dismiss the entire adversary proceeding. Sallie Mae remains a named party, and was the party with a claim against the Debtor on the petition date, and on the date the Plaintiff filed her adversary complaint. Furthermore, under 34 C.F.R. § 682.402(j)(1)(ii), Sallie Mae's repurchase of the Debtor's student loans from the guaranty agency if they are determined to be nondischargeable is mandatory.
A complaint for a determination of dischargeability constitutes a suit for purposes of the Eleventh Amendment, In re Mitchell, 222, B.R. 877, 884-85 (9th Cir. BAP 1998); See In re Morrell, 218 B.R. 87, 89-90 (Bankr.C.D.Cal.1997). Even so, this Court applies the facts as they existed on the petition date in this bankruptcy case in determining dischargeability. In re Combs, 101 B.R. 609, 614-15 (9th Cir. BAP 1989); In re Tessler, 44 B.R. 786, 788 (Bankr.S.D.Cal.1984). On the petition date, November 9, 1998, Sallie Mae, not NYSHESC, held student loan claims against the Debtor. NYSHESC did not purchase Debtor's student loan debt from Sallie Mae until, at the earliest, April 10, 1999. If NYSHESC enjoys New York's Eleventh Amendment sovereign immunity, Sallie Mae does not.
This Court had jurisdiction over the Debtor's dischargeability complaint on March 4, 1999, when she filed her complaint. Debtor's claim for dischargeability under § 523(a)(8) is a core proceeding which this Court has jurisdiction to hear and determine under 28 U.S.C. § 157(b)(2)(I). NYSHESC's answer admits this Court has jurisdiction to hear and determine this case. Section 523(a)(8) is *221 not self-effectuating, it requires the debtor to bring an adversary proceeding to determine whether the debt is dischargeable under that section. In re Greenwood, 237 B.R. 128, 130 (N.D.Tex.1999); In re Stout, 231 B.R. 313, 315 (Bankr.W.D.Mo.1999). The Debtor did her part by filing her complaint. NYSHESC, after purchasing the student loans, was required to determine the merits of Debtor's dischargeability claim, and oppose it if warranted, by the provisions of 34 C.F.R. § 682.402(i). Sallie Mae remains potentially obligated to repurchase the loans from NYSHESC under 34 C.F.R. § 682.402(i).
Instead of performing its obligations under 34 C.F.R. § 682.402(i), and filing a notice of transferred claim as provided under F.R.B.P. 3002(e), NYSHESC asserts sovereign immunity without satisfying its burden of showing it is an arm of the State. NYSHESC may ultimately succeed in obtaining dismissal for itself on the basis of Eleventh Amendment immunity, but that does not divest this Court of its jurisdiction to hear and decide whether Debtor's student loan debt is dischargeable under § 523(a)(8). This Court's jurisdiction over dischargeability of debt derives not from jurisdiction over a State or other creditors, but rather from jurisdiction over debtors and their estates. In re NVR, 1999 WL 486614 *6 (4th Cir.1999) (quoting Maryland v. Antonelli Creditors' Liquidating Trust ("Antonelli"), 123 F.3d 777, 787 (4th Cir.1997)). "Bankruptcy operates by virtue of the Supremacy Clause and without forcing the state to submit to suit in federal court." State of Texas v. Walker, 142 F.3d 813, 822 (5th Cir.1998) (citing Antonelli).
There is no record in Case No. 98-33267-7 of Sallie Mae's transfer of Debtor's student loan debts to NYSHESC, only a statement in its brief and Bradley's affidavit. Given NYSHESC's failure to comply with its requirements under federal regulations to determine the merits and, if warranted, appear and oppose the Debtor's dischargeability complaint, and Sallie Mae's potential requirement to repurchase the loans from NYSHESC, this Court is not inclined to dismiss this adversary proceeding on the basis of NYSHESC's asserted sovereign immunity. In the first place, NYSHESC's conduct in refusing to honor of its requirements under federal student loan regulations is inconsistent with its obligation to obey the binding laws of the United States in good faith. Alden v. Maine, 119 S.Ct. at 2267. This lack of good faith is especially glaring when NYSHESC argues it was compelled to comply with the regulation requiring it to purchase Debtor's student loan debt from Sallie Mae, but ignores its obligations to determine the merits of Debtor's dischargeability claim and oppose it pursuant to 34 C.F.R. § 682.402(i).
In the second place, dismissal would leave the question of the dischargeability of Debtor's student loans unresolved. As stated above, the Debtor did her part by initiating the instant dischargeability proceeding. NYSHESC seeks dismissal on the basis of Eleventh Amendment Immunity, but dismissal would not equate to a determination on the merits. It is clear from Walker that the Debtor's right to assert an affirmative defense of discharge in bankruptcy to the State's suit on the debt in state court is preserved. 142 F.3d at 822-23; Greenwood, 237 B.R. at 131. The granting of a bankruptcy discharge does not offend the Eleventh Amendment, and the State cannot claim sovereign immunity against a claim of discharge. Walker, 142 F.3d at 822-823. Neither can Sallie Mae hide behind the State of New York's sovereign immunity from its contingent liability to repurchase loans which are determined to be nondischargeable.
A Discharge of Debtor was entered in the main bankruptcy case on March 9, 1999, releasing the Debtor from all dischargeable debts and voiding any future judgment with respect to "debts dischargeable under 11 U.S.C. § 523(a)". *222 With certain exceptions which are not applicable here the Bankruptcy Court has original and exclusive jurisdiction over the dischargeability of student loan debt under § 523(a)(8). In re Towe, 147 B.R. 545, 549 (Bankr.D.Mont.1992), (citing In re Daley, 776 F.2d 834, 838 (9th Cir.1985)), (cert. denied, 476 U.S. 1159, 106 S. Ct. 2279, 90 L. Ed. 2d 721 (1986)); In re Gruntz ("Gruntz"), 166 F.3d 1020, 1024-26 & n. 4 (9th Cir.1999); Berr v. FDIC, 172 B.R. 299, 312 (9th Cir. BAP 1994); In re Houtman, 568 F.2d 651, 653-54 (9th Cir.1978). NYSHESC does not cite any authority granting another court jurisdiction over dischargeability proceedings.
In light of NYSHESC's failure to follow its obligations under 34 C.F.R. § 682.402(i), its failure to file proof of a transferred claim as provided under Rule 3002(e), the Court's undisputed jurisdiction over Debtor's core dischargeability proceeding on the petition date and on the date Debtor filed her complaint, and Sallie Mae's contingent liability to repurchase loans determined nondischargeable under 34 C.F.R. § 682.402(j)(1)(ii), this Court deems itself with authority and jurisdiction under the Supremacy Clause proceed with this adversary proceeding. If the student loans are determined to be dischargeable under § 523(a)(8), further declaratory relief may be available to the Debtor under the Ex Parte Young exception to sovereign immunity against any State officer which pursues collection against the Debtor of discharged student loan debts. Alden v. Maine, 119 S.Ct. at 2263, 2267-68 (citing Ex Parte Young). Since Walker provides that the Debtor may assert discharge as an affirmative defense, and this Court has exclusive jurisdiction to determine the dischargeability of student loans, neither NYSHESC nor Sallie Mae could proceed in state court with collection of student loans in any event until after dischargeability of the loans is determined, without possibly violating the discharge injunction.
IT IS ORDERED NYSHESC's motion to dismiss this adversary proceeding, filed August 5, 1999, is denied.
NOTES
[1] The Eleventh Amendment of the United States Constitution states:
"The Judicial Power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State."
[2] NYSHESC's supporting memorandum states the Debtor owes it $53,387.82 as of April 10, 1999. Debtor's Schedule I and Statement of Financial Affairs show the Debtor is employed as a temporary clerical worker, earns $855 net per month and has monthly expenses of $805. Her 1996 income was $8,622; 1997 income was $7,203; and 1998 income through October 11, 1998, was $5,100.36. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2809441/ | People v Stevenson (2015 NY Slip Op 05216)
People v Stevenson
2015 NY Slip Op 05216
Decided on June 17, 2015
Appellate Division, Second Department
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.
This opinion is uncorrected and subject to revision before publication in the Official Reports.
Decided on June 17, 2015
SUPREME COURT OF THE STATE OF NEW YORK
Appellate Division, Second Judicial Department
PETER B. SKELOS, J.P.
JOHN M. LEVENTHAL
LEONARD B. AUSTIN
ROBERT J. MILLER, JJ.
2013-06438
(Ind. No. 945/11)
[*1]The People of the State of New York, respondent,
vFrank R. Stevenson, appellant.
Lynn W. L. Fahey, New York, N.Y. (Jenin Younes of counsel), for appellant.
Kenneth P. Thompson, District Attorney, Brooklyn, N.Y. (Leonard Joblove and Ruth E. Ross of counsel), for respondent.
DECISION & ORDER
Appeal by the defendant from a judgment of the Supreme Court, Kings County (Murphy, J.), rendered May 28, 2013, convicting him of rape in the first degree, sexual abuse in the first degree (two counts), and endangering the welfare of a child (two counts), upon a jury verdict, and imposing sentence.
ORDERED that the judgment is affirmed.
The Supreme Court properly admitted into evidence a recording of a telephone call that was made by the defendant from Rikers Island three days after his arrest. "Even equivocal consciousness-of-guilt evidence may be admissible so long as it is relevant, meaning that it has a tendency to establish the fact sought to be proved—that [the] defendant was aware of guilt" (People v Bennett, 79 NY2d 464, 470; see People v Braithwaite, 126 AD3d 993, 995-996). Here, the recording of the telephone call was admissible as evidence of consciousness of guilt, and its probative value outweighed any potential for prejudice (see People v Livrieri, 125 AD3d 579; People v Case, 113 AD3d 872, 873; People v Marcus, 101 AD3d 1046, 1048; People v Cruz, 41 AD3d 893).
We agree with the defendant that the Supreme Court erred in granting the People's request to charge the jury, over the defendant's objection, regarding intoxication, as there was insufficient evidence of intoxication in the record (cf. People v Beaty, 22 NY3d 918, 921; People v Blouin, 223 AD2d 650). Nevertheless, this error was harmless, as there was overwhelming evidence of the defendant's guilt and there is no significant probability that the error contributed to his convictions (see People v Crimmins, 36 NY2d 230, 242; see also People v Fowle, 60 AD3d 691, 691; People v Martinez, 18 AD3d 343, 344).
The defendant contends that the trial court erred by permitting the People to introduce into evidence a photograph depicting the victim, that the prosecutor improperly displayed slides, including that photograph, with accompanying text as part of a PowerPoint presentation during summation, and that the prosecutor made certain improper remarks during summation. These contentions are unpreserved for appellate review (see CPL 470.05[2]). In any event, contrary to the defendant's contention, these alleged errors were not, either individually or collectively, so egregious [*2]as to deprive the defendant of a fair trial.
Moreover, contrary to the defendant's contention, defense counsel's failure to object to the challenged summation remarks did not constitute ineffective assistance of counsel (see People v McGowan, 111 AD3d 850, 851; People v Brown, 106 AD3d 754, 755; People v Torres, 72 AD3d 709, 709). The record reveals that defense counsel provided meaningful representation (see People v Taylor, 1 NY3d 174, 174; People v Benevento, 91 NY2d 708, 712; People v Williams, 123 AD3d 1152, 1154).
Contrary to the defendant's contention, the fact that the sentence imposed after trial was greater than the sentence offered during plea negotiations does not, standing alone, establish that he was punished for asserting his right to proceed to trial (see People v Murray, 116 AD3d 1068, 1069; People v Fernandez, 115 AD3d 977, 979). Moreover, the sentence imposed was not excessive (see People v Suitte, 90 AD2d 80, 83).
SKELOS, J.P., LEVENTHAL, AUSTIN and MILLER, JJ., concur.
ENTER:
Aprilanne Agostino
Clerk of the Court | 01-03-2023 | 06-17-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1032517/ | ineffective was itself procedurally barred. Hathaway v. State, 119 Nev.
248, 252-53, 71 P.3d 503, 506 (2003). Further, appellant's reliance upon
Martinez was misplaced as Martinez relates to federal procedural bars and
not state procedural bars. Also, we note that Martinez involves ineffective
assistance of post-conviction counsel and not ineffective assistance of trial
counsel. Therefore, the district court did not err in denying this claim.
Next, appellant claimed that Missouri v. Frye, 566 U.S.
132 S. Ct. 1399 (2012), provided good cause because trial counsel was
ineffective in advising him to accept a plea offer from the State.
Appellant's good-cause argument was without merit because this claim
was always available and he failed to demonstrate why he waited nearly
three years to raise it. Further, his case was final when Frye was decided,
and he failed to demonstrate that the case would apply retroactively to
him. Even if Frye announced new rules of constitutional law, he failed to
allege that he met either exception to the general principle that such rules
do not apply retroactively to cases which were already final when the new
rules were announced. See Colwell v. State, 118 Nev. 807, 816-17, 59 P.3d
463, 469-70 (2002). Therefore, the district court did not err in denying this
claim.
Finally, appellant claimed that new evidence demonstrated
that he was actually innocent of burglary. Appellant did not demonstrate
actual innocence because he failed to show that "it is more likely than not
that no reasonable juror would have convicted him in light of. . . new
evidence." Calderon v. Thompson, 523 U.S. 538, 559 (1998) (quoting
Schlup v. Delo, 513 U.S. 298, 327 (1995)); see also Pellegrini v. State, 117
Nev. 860, 887, 34 P.3d 519, 537 (2001); Mazzan v. Warden, 112 Nev. 838,
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842, 921 P.2d 920, 922 (1996). We therefore conclude that the district
court did not err in denying appellant's petition, and we
ORDER the judgment of the district court AFFIRMED. 2
J.
Hardesty
J.
Parraguirre
J.
cc: Hon. Jennifer P. Togliatti, District Judge
John Lee Rush
Attorney General/Carson City
Clark County District Attorney
Eighth District Court Clerk
2 We have reviewed all documents that appellant has submitted in
proper person to the clerk of this court in this matter, and we conclude
that no relief based upon those submissions is warranted. To the extent
that appellant has attempted to present claims or facts in those
submissions which were not previously presented in the proceedings
below, we have declined to consider them in the first instance.
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II | 01-03-2023 | 07-09-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1032519/ | matter of right sufficient cross-examination has been permitted to satisfy
the sixth amendment." Crew v. State, 100 Nev. 38, 45, 675 P.2d 986, 990
(1984). Where bias is meant to be shown, the district court's discretion is
narrower, and an examiner must be allowed to draw out any fact which
might color the witness's testimony. Bushnell v. State, 95 Nev. 570, 572,
599 P.2d 1038, 1040 (1979). An accused is given great latitude in cross-
examining an accomplice with regard to his or her motives for testifying.
Eckert v. State, 96 Nev. 96, 101, 605 P.2d 617, 620 (1980); see also
Bushnell, 95 Nev. at 572, 599 P.2d at 1039.
Appellant elicited testimony that Shay initially faced multiple
felony charges and that, after negotiations with the State in which she
agreed to testify at appellant's trial, she ultimately pleaded guilty to one
felony count of pandering with the opportunity to reduce it to a gross
misdemeanor and received probation. Her motive to lie was emphasized
in appellant's opening and closing statements, as well as in the jury
instructions, which included a list of Shay's initial charges as well as the
charge to which she pleaded. Furthermore, Shay testified that she had
been jailed as a result of the matter and never wanted to have the
experience again. 1 The jury was made fully aware of the legal benefits
that Shay received by agreeing to testify at appellant's trial.
The district court sustained respondent's objection to
appellant's line of questioning which attempted to elicit the fact that Shay
faced a possible term of life imprisonment, arguing that if the information
'To the extent that appellant argues that he was prevented from
demonstrating Shay's motive to lie based on her understanding of
incarceration as brutal and humiliating, his claim is belied by the record.
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tiffe-j5iWicrEM3Vw-7Y1 I l'"--
)ft ' -
, TrY14DIfttrA,- - WitlY1154arM. ; *-Tr, ?Ta.;
was disclosed, the jury would know appellant's potential sentence. In
balancing appellant's right to extract any fact which might color Shay's
testimony against the concern for an unbiased jury, including one that
does not consider punishment while considering guilt, see Valdez v. State,
124 Nev. 1172, 1184, 196 P.3d 465, 473-74 (2008) (explaining that jurors
should not consider the punishment during the guilt phase of trial), the
district court allowed appellant to ask Shay if she faced "substantial time"
prior to striking a deal with the State. We conclude the district court did
not abuse its discretion in limiting appellant's cross-examination of Shay.
See Leonard v. State, 117 Nev. 53, 72, 17 P.3d 397, 409 (2001) (finding that
"trial judges 'retain wide latitude' to restrict cross-examination to explore
potential bias 'based on concerns about, among other things, harassment,
prejudice, confusion of the issues, the witness' safety, or interrogation that
is repetitive or only marginally relevant" (quoting Delaware v. Van
Arsdall, 475 U.S. 673, 679 (1986))).
Second, appellant argues that there was insufficient evidence
to sustain his convictions for sexual assault with the use of a deadly
weapon and kidnapping with the use of a deadly weapon. In reviewing a
claim of insufficient evidence, we consider whether the evidence, when
viewed in the light most favorable to the prosecution, was sufficient to
establish guilt beyond a reasonable doubt as determined by a rational trier
of fact. Jackson v. Virginia, 443 U.S. 307, 319 (1979); McNair v. State, 108
Nev. 53, 56, 825 P.2d 571, 573 (1992). It is for the jury to determine the
weight and credibility to give conflicting testimony, and a reviewing court
will not disturb a verdict if it is supported by substantial evidence. See
Bolden v. State, 97 Nev. 71, 73, 624 P.2d 20, 20 (1981).
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LIMENB2W20211 '
Appellant claims that because the victim relayed various
stories to different individuals regarding the sexual assault incident, the
resulting conviction cannot stand. The jury heard testimony from the
victim as to the events before, during, and after the alleged sexual assault.
The victim's uncorroborated testimony alone, if believed by the jury
beyond a reasonable doubt, is sufficient to uphold a conviction. See
Hutchins v. State, 110 Nev. 103, 109, 867 P.2d 1136, 1140 (1994) modified
on other grounds by Mendoza v. State, 122 Nev. 267, 275 76, 130 P.3d 176,
-
181 (2006). Nonetheless, the jury also heard corroborating evidence.
Shay's testimony as to the events before and after the time when
appellant and the victim were alone supported the victim's testimony. A
video showing appellant's beating of the victim also supported various
aspects of her testimony. 2 Furthermore, items retrieved from the
residence served to reinforce the testimony. We conclude that there was
sufficient evidence to sustain the conviction of sexual assault with the use
of a deadly weapon. See NRS 193.165(1); NRS 200.366.
Appellant further contends that he improperly sustained a
conviction for first-degree kidnapping with the use of a deadly weapon,
arguing that the victim's movement from one bedroom to another as she
was being beaten was incidental and did not substantially exceed the
movement required to complete the associated crime charged or
2 Insomuch as appellant claims that his convictions were the result of
an emotional response to videotaped evidence and that the district court
erred in allowing the video to be played, we discern no abuse of discretion
by the district court in admitting the evidence.
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significantly increase the risk of harm to her. 3 On the day of the sexual
assault, appellant grabbed the victim by the hair and forcibly dragged her
from her bedroom to the master bedroom where she was beaten with
objects located in the room and brought into the room by Shay on
appellant's orders. Appellant held an aluminum bat to her throat as he
continued to beat her and eventually moved her to the bathroom where he
sexually assaulted her. The evidence was sufficient for a rational juror to
find beyond a reasonable doubt that appellant could have committed the
sexual assault without moving the victim and that the forcible movement
and restraint created a greater risk of harm to her than was necessary to
accomplish the crime of sexual assault. Therefore, we conclude that there
was sufficient evidence to sustain appellant's conviction of first-degree
kidnapping with the use of a deadly weapon. 4 See NRS 193.165(1); NRS
200.310(1); Mendoza, 122 Nev. at 274-75, 130 P.3d at 180-181 (explaining
that dual convictions for kidnapping and the underlying offense are
3 Appellantargues that his kidnapping for the purpose of committing
a sexual assault cannot stand because there is insufficient evidence to
support the sexual assault charge. As we have resolved the insufficiency
claim against appellant, we conclude that this argument is without merit.
4 Tothe extent that appellant argues that the victim came to Las
Vegas voluntarily and had daily access to others through her laptop,
cellphone, and sporadic public outings, we consider this a sufficiency
challenge to his conviction of second-degree kidnapping with the use of a
deadly weapon. The victim testified that she could not leave because
appellant warned that he would kill her if she tried, a threat corroborated
by Shay, and that when the victim said she wanted to leave, she was
beaten by appellant with a bat and chain belt. We conclude that there
was sufficient evidence to sustain this conviction. See NRS 193.165(1);
NRS 200.310(2).
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(0) I947A
=.3-74011ASFM.1-I---V-r3,-,Y- • 1):',(`.. 11:11111111=1111
appropriate where "movement or restraint serves to substantially increase
the risk of harm to the victim" or "substantially exceeds that required to
complete the associated crime charged").
Third, appellant claims that the district court erred by
denying his battery/domestic violence instruction thereby limiting the
presentation of his theory of the case. The district court enjoys broad
discretion in settling jury instructions, and we review its decision for an
abuse of discretion or judicial error. Crawford v. State, 121 Nev. 744, 748,
121 P.3d 582, 585 (2005). While a defendant is entitled to a jury
instruction on his theory of the case if some evidence supports it, Harris v.
State, 106 Nev. 667, 670, 799 P.2d 1104, 1105-06 (1990), a defendant is not
entitled to instructions that are "misleading, inaccurate or duplicitous,"
Carter v. State, 121 Nev. 759, 765, 121 P.3d 592, 596 (2005), and a request
for a lesser-included offense instruction is conditioned on that offense
being necessarily included in the charged offense, see Rosas v. State, 122
Nev. 1258, 1264, 147 P.3d 1101, 1106 (2006). An instruction on the crime
of battery/domestic violence would be misleading and inaccurate because
appellant was not charged with battery/domestic violence and the
instruction would incorrectly suggest that the jury could find him guilty of
the uncharged crime. Furthermore, battery/domestic violence is not a
lesser-included offense of any of appellant's charges. See NRS 33.018(1);
NRS 193.165; NRS 199.480; NRS 200.310; NRS 200.366; NRS 201.300;
NRS 201.320; NRS 207.190; NRS 453.337; Smith v. State, 120 Nev. 944,
946, 102 P.3d 569, 571 (2004) (defining lesser-included offense).
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El AY.4\5:4WW1 I LM.-141:
10-74,9,1:1
Accordingly, we conclude that the district court did not abuse its discretion
by refusing to give the proffered instruction. 5
Having considered appellant's claims and concluded that no
relief is warranted, we
ORDER the judgment of conviction AFFIRMED.
‘144.41/4,
Hardesty
Parraguirre Cherry
cc: Hon. Michael Villani, District Judge
Clark County Public Defender
Attorney General/Carson City
Clark County District Attorney
Eighth District Court Clerk
We note that, despite appellant's claim that denial of the
5
instruction curtailed the presentation of his theory of the case, he
thoroughly argued the incident as battery/domestic violence in his opening
and closing statements.
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• = | 01-03-2023 | 07-09-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603915/ | 135 Mich. App. 579 (1982)
354 N.W.2d 263
GILLIARD
v.
DEPARTMENT OF SOCIAL SERVICES
Docket No. 54462.
Michigan Court of Appeals.
Decided May 25, 1982.
Fraser, Trebilcock, Davis & Foster, P.C. (by Michael E. Cavanaugh and William R. Landgraf), for Michigan State Employees Association and Charles Gilliard.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Janis Meija and Robert N. Rosenberg, Assistants Attorney General, for the Department of Social Services.
Frank J. Kelley, Attorney General, Robert A. Derengoski, Solicitor General, and Varda N. Fink, Assistant Attorney General, for the Civil Service Commission.
Before: BEASLEY, P.J., and T.M. BURNS and E.A. QUINNELL,[*] JJ.
*582 PER CURIAM.
Petitioner Charles Gilliard began working as an assistant payments worker for the Department of Social Services on October 21, 1973. On September 25, 1975, the DSS sent petitioner the following telegram:
"This is to inform you that your employment with the Michigan Department of Social Services is terminated for reasons of conduct unbecoming a state employee as evidence indicates that you are involved in a welfare fraud. This dismissal action is effective at the close of business hours on September 24, 1975.
"John Smith, Director "Office of Administration "Michigan Department of Social Services"
The DSS subsequently summarized the alleged activities which led to petitioner's dismissal in the following manner:
"1. Mr. Gilliard approached ADC client Dianne Davison in February, 1975, and requested her complicity in cashing an ADC warrant to be issued by Mr. Gilliard in another person's name. Mr. Gilliard indicated that proceeds would then be split between Mr. Gilliard and Ms. Davison.
"2. Mr. Gilliard failed to close client Linda Jackson's case at her request in December, 1974, and, instead, forwarded warrants in her name to another address where they were received by client Delores Johnson who cashed the warrants and split the proceeds with Mr. Gilliard. These warrants were issued bi-weekly from January 9, 1975, until April 8, 1975."
On April 6, 1976, petitioner was indicted on 11 charges of conspiracy to commit and the commission of welfare fraud. On September 28, 1976, a jury acquitted him on all charges. The next day, petitioner sought reinstatement to his former position, but the DSS refused his request. The DSS *583 also refused to give him a hearing on the charges leading to his discharge on the ground that he had not filed a grievance within ten days in accordance with the requirements of the civil service rules.
Petitioner thereupon filed a petition for review in the circuit court, which denied relief. He fared no better on appeal to this Court. However, the Michigan Supreme Court, in Michigan State Employees Ass'n v Civil Service Comm, 406 Mich 313; 279 NW2d 530 (1979), held that petitioner was entitled to a hearing because the limitation period for filing a grievance under the civil service rules had been tolled from the time of his discharge until his acquittal on the criminal charges.
On January 2, 3, and 4, 1980, petitioner finally received the hearing, for which he had fought so long, before an arbitrator. On March 19, 1980, the arbitrator ruled that petitioner was entitled to reinstatement with full back pay. However, the arbitrator did not award interest on the back pay and ruled that the award would be reduced by any outside earnings, unemployment benefits, and governmental assistance.
Both petitioner and DSS sought to appeal the arbitrator's award to the Civil Service Commission which denied leave to appeal to both parties "because the commission defers to arbitration and because neither unfair or irregular arbitration procedures nor a result repugnant to commission rules has been shown".
DSS and petitioner then appealed the commission's decision upholding the arbitration award to the circuit court, which affirmed. Petitioners Gilliard and the Michigan State Employees Association appeal as of right the arbitrator's refusal to award interest and the arbitrator's deduction of unemployment compensation and ADC benefits form the *584 back pay award. Respondent DSS appeals the arbitrator's finding that DSS failed to show that Gilliard was discharged for cause. Respondent Civil Service Commission contends that petitioners' and DSS's claims should be dismissed and that the commission's decision to uphold the arbitration award should be affirmed.
We initially observe that the DSS may lack standing to pursue the instant appeal. The DSS is essentially a subordinate of the Civil Service Commission. Since the commission's decision amounts to a decision by the State of Michigan, a subordinate agency would ordinarily lack standing to challenge such a decision absent express statutory authority. We have not located any such express authority. Despite our reservations about the DSS's capacity to appeal,[1] we shall address the merits of its claims of error.
The DSS initially contends that the decision of the Civil Service Commission denying review of the arbitrator's decision was not supported by competent, material, and substantial evidence on the whole record and must therefore be reversed. Although the government's case against petitioner was strong, there were serious questions about the credibility of crucial government witnesses. Resolution of this case turned upon the trier of facts' assessment of the credibility of the witnesses, and the arbitrator apparently chose to believe petitioner's version of the facts. We find that the commission's decision to uphold the arbitrator's award was supported by competent, material, and substantial evidence.
DSS also contends that the arbitrator applied an *585 incorrect standard of proof "beyond a reasonable doubt" against it, rather than a "preponderance of the evidence" standard. Although the arbitrator stated that he was applying a "clear and convincing evidence" standard, he relied upon several cases which embraced the "reasonable doubt" standard. We need not determine, however, which standard was employed by the arbitrator since the commission is free to approve the use of a higher standard of proof in a case involving allegations of criminal conduct (or, for that matter, in any case). The commission is free to adopt any grievance or appellate procedure it finds appropriate as long as it does so consistently with the requirements of due process since it has full and absolute power over civil service employees. Const 1963, art 11, § 5.
Finally, the DSS contends that the arbitrator committed error by excluding evidence of a polygraph examination taken by one of their witnesses. We disagree. Subject to one carefully drawn exception (which is inapplicable to the case at bar),[2] Michigan courts have consistently held that the results of polygraph examinations are inadmissible. See, e.g., People v Liddell, 63 Mich App 491; 234 NW2d 669 (1975).
We now turn to petitioner's allegations of error. First of all, petitioner contends that the arbitrator erred by failing to award interest on the back pay award from the date of his wrongful discharge. We agree. MCL 438.7; MSA 19.4 provides:
"In all actions founded on contracts express or implied, whenever in the execution thereof any amount in money shall be liquidated or ascertained in favor of either party, by verdict, report of referees, award of arbitrators, or by assessment made by the clerk of the *586 court, or by any other mode of assessment according to law, it shall be lawful, unless such verdict, report, award, or assessment shall be set aside, to allow and receive interest upon such amount so ascertained or liquidated, until payment thereof, or until judgment shall be thereupon rendered; and in making up and recording such judgment, the interest on such amount shall be added thereto, and included in the judgment."
In Wilson v Doehler-Jarvis Div of National Lead Co, 358 Mich 510; 100 NW2d 226 (1960), the Supreme Court held that this statute permits the circuit court to award interest on a workers' compensation award, finding that the right to such an award arises out of a statutorily imposed contract between the worker and employer. Interest was awarded from the date the claim should have been paid.
We find the Wilson rationale applicable to the case at bar. The award of back pay was based upon a contract between petitioner and the DSS. In the words of the Wilson Court:
"Who benefited from the delay in payment here? Who, if anyone, suffered any loss? In the instant case the disputed claim for compensation has been in the throes of litigation for over 5 years. In the meantime the defendant-appellant has had the possession and use of funds that it now appears rightfully belonged all along to the plaintiff, while the plaintiff (theoretically if not actually) had to raise money elsewhere (and presumably pay interest on it) to meet the daily necessities of life. In a real sense, then, the employee and his dependents have been obliged to help subsidize the employer in the long, expensive fight for possession of the money thus wrongfully withheld." 358 Mich 516-517.
Similarly, petitioner should not be forced to bear *587 the burden of subsidizing his employer during the pendency of this litigation.[3] Accordingly, we remand this case to the circuit court with directions to modify the award by adding interest from the date of petitioner's discharge.
Petitioner also contends that unemployment compensation and ADC benefits were erroneously deducted from the arbitrator's award. We cannot agree. Commission rules clearly mandate such deductions.[4] Citing no relevant authority in support of his position, petitioner apparently urges this Court to strike down these rules. We decline to do so. Such a double recovery would be manifestly unfair in the context of a recovery for breach of contract, and particularly so in the present case because both the principal recovery and the collateral benefits would be paid by the same party, the state.
Affirmed in part, reversed in part, and remanded for modification of the award in accordance with this opinion. Petitioner may tax costs.
NOTES
[*] Circuit judge, sitting on the Court of Appeals by assignment.
[1] In Groehn v Corporation & Securities Comm, 350 Mich 250; 86 NW2d 291 (1957), the Supreme Court addressed the merits of a departmental employer's appeal of a commission decision, but did not mention the standing issue.
[2] See People v Barbara, 400 Mich 352; 255 NW2d 171 (1977).
[3] We note that the Wilson case was decided against a background of considerably lower interest and inflation rates than those prevailing in the present period. Hence, an award of interest is even more necessary to compensate petitioner for the actual damages he has sustained.
[4] The relevant rules provide:
"9-2609 Awards. All awards of back pay and benefits, even when not expressly stated, shall be subject to the rules and regulations of the commission, and shall be subject to:
"9-2609a Deduction of earnings in other employment or self-employment.
"9-2609b Deduction of benefits received from employer contributory income protection insurance.
"9-2609c Deduction of benefits received under the following government assistance programs:
"(1) Worker's Compensation "(2) Unemployment Compensation "(3) Social Security "(4) Social Welfare". | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603916/ | 8 So.3d 526 (2009)
In re Roy A. RASPANTI.
No. 2008-B-0954.
Supreme Court of Louisiana.
March 17, 2009.
Rehearing Denied May 22, 2009.
*527 Charles Bennet Plattsmier, Baton Rouge, for applicant.
John Anthony Occhipinti, Roy Anthony Raspanti, Metairie, Douglas Michael Schmidt, New Orleans, for respondent.
ATTORNEY DISCIPLINARY
WEIMER, J.
This disciplinary matter arises from formal charges filed by the Office of Disciplinary *528 Counsel (ODC) against attorney Roy A. Raspanti (Respondent). The charges alleged, in part, that he filed a defamation suit against a former client based on a complaint she filed with the ODC. The ODC asserted Respondent's actions violated Section 12 of Louisiana Supreme Court Rule XIX (Rule XIX), which provides, in part, that communications to the disciplinary board, the hearing committee, and the ODC "shall be absolutely privileged" and that "no lawsuit predicated thereon may be instituted against any complainant or witness."
Both the hearing committee and the disciplinary board found Respondent's conduct violated Rules 3.1, 8.4(a), and 8.4(d) of the Rules of Professional Conduct. Furthermore, the hearing committee determined Respondent violated the "spirit" of Rule XIX, § 12(A), and the disciplinary board found his conduct was in "direct violation" of that provision.
Because this court has never specifically addressed the effect of Section 12(A), we docketed the matter on our own motion in order to address the legal issue raised herein: whether an attorney's violation of Rule XIX, § 12(A) can be the basis for discipline and the imposition of sanctions.[1]
FACTS
The following facts are undisputed and supported by the record. Thus, if we agree with the committee's and the board's resolution of the legal issue, the ODC will have met its burden of proof by clear and convincing evidence.
Over the years, Respondent has represented his sister, Janine Raspanti, in various civil matters, at the urging of his parents. In 1994, Ms. Raspanti filed the first of several disciplinary complaints against Respondent with the ODC; she alleged that Respondent had engaged in unethical conduct in representing her in two civil suits for damages. For the most part, her complaints stemmed from disputes between herself and Respondent concerning the payment of legal fees. In each instance, the ODC found no clear and convincing evidence of ethical misconduct by Respondent and dismissed the complaint. As is the right of every complainant under the provisions of Rule XIX, Ms. Raspanti appealed the dismissal of each of her complaints to a hearing committee, to the disciplinary board, and to this court. Again, in each instance, the ODC's decision to dismiss the complaint against Respondent was affirmed.
Ms. Raspanti's second complaint was filed in 1997. According to Respondent, Ms. Raspanti alleged he had engaged in a "dishonest, fraudulent and deceitful misrepresentation" and that he engaged in document concealment, was "exploitive" and breached "his ethics." The ODC determined that Ms. Raspanti's "new" complaint was meritless, did not require a response from Respondent, and warranted dismissal without further investigation. Unfortunately, due to an oversight, the ODC did not notify Respondent of the 1997 complaint. Respondent avers he would not have undertaken a subsequent *529 representation of his sister in 1999 had he known of her second complaint in 1997. During the years, Respondent obtained judgments in favor of his sister, but the disputes over fees continued.
Ms. Raspanti filed her third complaint with the ODC in December of 2001. In March and April of 2002, she made five communications to the ODC, in which she restated her continuing dissatisfaction with Respondent. Again, the ODC responded by dismissing her complaints.
In January 2003, Respondent filed a lawsuit against Ms. Raspanti for breach of contract and defamation. The third cause of action contained in Respondent's petition specifically asserted defamation by Ms. Raspanti because of the complaints she had filed against him with the ODC. In response to the petition, Ms. Raspanti asserted the defense of immunity pursuant to Rule XIX, § 12(A). Respondent opposed the exception, arguing that, at a minimum, Ms. Raspanti was not immune from liability for defamatory statements she made in her complainant appeals filed in this court, a body which is not specifically listed in Rule XIX, § 12(A).[2]
Following a mediation effort in early 2004, the attorney for Ms. Raspanti's insurer sent a letter to the other parties and their counsel stating, in part:
Both parties agree to execute a Release Agreement which will prevent them from ever bringing any further disciplinary complaints or lawsuits arising out of or in any way connected with Roy's representation of Janine over the past ten years. Roy will receive payment of $3,000.00. Janine will agree that if she `defames Roy in the future, and he successfully prosecutes to final judgment a claim for that defamation, Janine will pay him, in addition to the actual damage award, a penalty of $15,000 plus reasonable attorney's fees.
Thereafter, Respondent forwarded to Ms. Raspanti's attorneys a two-page settlement proposal which contained the essence of the above statement. Respondent also proposed that: "In the event that Roy Raspanti ever obtains a final collectible judgment against Janine M. Raspanti for libel, slander, or defamation, for any incidents occurring after the date of this agreement, Janine M. Raspanti agrees to pay Roy Raspanti, in addition to the actual damage award, an additional penalty of $15,000 plus reasonable attorney's fees and costs." Ms. Raspanti did not agree to Respondent's settlement proposal, and Respondent's lawsuit against her remains pending at this time.
DISCIPLINARY PROCEEDINGS
On December 19, 2006, the ODC filed one count of formal charges against Respondent, alleging that his conduct as set forth above violated Rule XIX, § 12(A) as well as the following provisions of the Rules of Professional Conduct: Rules 8.4(a) (violation of the Rules of Professional Conduct) and 8.4(d) (engaging in conduct prejudicial to the administration of justice).[3] Respondent answered the formal charges and denied any misconduct.
*530 Formal Hearing:
This matter proceeded to a formal hearing on May 15, 2007. Respondent appeared at the hearing and was represented by counsel. The committee received documentary evidence from both Respondent and the ODC. The ODC called attorney Thomas Buck to testify in person before the hearing committee. Mr. Buck represented Janine Raspanti and her homeowner's insurer in connection with the defamation and breach of contract lawsuit filed against her by Respondent.
Respondent testified on his own behalf and on cross-examination by the ODC. In his testimony, Respondent stated that he agreed to represent Ms. Raspanti at the urging of their parents. According to Respondent, Ms. Raspanti filed disciplinary complaints against him whenever she did not want to pay him his fee. He filed a lawsuit against her because he believed he had a cause of action for defamation. However, he amended the lawsuit to remove the defamation cause of action based on Ms. Raspanti's disciplinary complaints and her complainant appeals to the ODC, hearing committees, and disciplinary board, but kept the defamation cause of action based upon her complainant appeals to this court. He also added the causes of action of abuse of process and malicious prosecution based on Goldstein v. Serio, 496 So.2d 412 (La.App. 4 Cir.1986), writs denied, 501 So.2d 208, 209 (La.1987), and Sommer v. State, Department of Transportation and Development, 97-1929 (La. App. 4 Cir. 3/29/00), 758 So.2d 923, writ denied, 00-1759 (10/27/00), 772 So.2d 122. Respondent also stated that he sent the proposed settlement agreement to Mr. Buck in response to Mr. Buck's February 12, 2004 letter, which summarized Mr. Buck's view of the settlement reached during the mediation. He testified that he did not think any of the provisions were going to be enforceable, but the judge and the mediator were strongly urging the parties to come to some sort of agreement. Therefore, he responded in good faith with his proposed settlement agreement.
Hearing Committee Report:
After considering the evidence and testimony presented at the hearing, the committee made the following findings.
Respondent filed a lawsuit against Ms. Raspanti that alleged a claim for defamation based upon various disciplinary complaints Ms. Raspanti had filed with the ODC and appeals to the hearing committee and disciplinary board, which claim is precluded by Rule XIX, § 12(A) and, therefore, is a non-meritorious action. Mr. Buck wrote to Respondent's attorney, raising the issue of Rule XIX, § 12(A) and requesting a dismissal of the defamation claim. Respondent amended the lawsuit but did not remove the defamation claim entirely. The third cause of action listed communications to the ODC and there was no clear delineation that the cause of action was based only on defamation in the Fifth Circuit Court of Appeals, United States District Court, and the Louisiana Supreme Court. On December 9, 2003, the trial court dismissed the defamation claim. Respondent's reliance on Goldstein is misplaced because the court of appeal based its decision on the Louisiana State Bar Association's Articles of Incorporation, Article XV, § 13 (repealed), which does not appear to specifically provide an absolute preclusion of suit based upon communications to the disciplinary board as is *531 contained in Rule XIX, § 12(A). Respondent's reliance on Sommer is also misplaced because Sommer does not interpret Rule XIX, § 12(A). Respondent wrote to Mr. Buck on March 9, 2004, and proposed a settlement agreement that included monetary penalties against Ms. Raspanti if she filed future disciplinary complaints against him. If executed, the agreement would have had a "chilling effect" on the filing of such complaints in the future.
Based on these findings, the committee determined that Respondent violated the spirit of Rule XIX, § 12(A) and also violated Rules 3.1, 8.4(a), and 8.4(d) of the Rules of Professional Conduct. The committee also determined that Ms. Raspanti suffered no direct harm. The only aggravating factor found by the committee was Respondent's refusal to acknowledge the wrongful nature of the conduct.
The committee further found that Ms. Raspanti filed at least two non-meritorious complaints against Respondent, and Respondent only represented her at the insistence of their parents. The committee indicated it appreciated Respondent's frustration with his sister and expressed sympathy with his plight, but stated that "we have no choice but to recognize the violation and recommend a sanction." Accordingly, the committee recommended that Respondent be publicly reprimanded.
Neither Respondent nor the ODC filed an objection to the hearing committee's recommendation.
Disciplinary Board Recommendation:
After review, the disciplinary board determined that the hearing committee's factual findings are not manifestly erroneous. The board found Respondent's conduct violated Rules 3.1, 8.4(a), and 8.4(d) of the Rules of Professional Conduct. Furthermore, the board determined Respondent engaged in conduct that was in direct violation of Rule XIX, § 12(A).
Regarding Respondent's reliance on Goldstein, the board noted that the Goldstein decision was rendered prior to the promulgation of Rule XIX, § 12(A), which became effective April 1, 1990. Regarding Respondent's reliance on Sommer, the board agreed with the committee that Sommer does not address Rule XIX, § 12(A).
The board determined that Respondent knowingly violated duties owed to the legal system and to Ms. Raspanti. He caused harm to Ms. Raspanti in that she was forced to defend the defamation claims. Furthermore, Respondent's retaliatory action threatens to undermine the disciplinary system. Relying on the ABA's Standards for Imposing Lawyer Sanctions, the board determined that the baseline sanction is suspension.
In aggravation, the board found the following factors: refusal to acknowledge the wrongful nature of the conduct, lack of remorse, substantial experience in the practice of law (since 1975), and indifference to making restitution or minimizing the harmful effects of the misconduct. The only mitigating factor found by the board is the absence of a prior disciplinary record.
Considering the above, the board recommended that Respondent be suspended for one year with all but three months deferred. The board further recommended that Respondent be placed on unsupervised probation for nine months following the active period of the suspension, subject to the condition that any misconduct during this period may be grounds for making the deferred suspension executory or imposing additional discipline, as appropriate. Finally, the board recommended that Respondent be assessed with all costs and expenses of these proceedings.
*532 DISCUSSION
The United States Supreme court has characterized attorney disciplinary proceedings as quasi-criminal in nature. In re Ruffalo, 390 U.S. 544, 551, 88 S.Ct. 1222, 1226, 20 L.Ed.2d 117 (1968). Rule XIX, § 18(A), states that "[disciplinary proceedings are neither civil nor criminal but are sui generis."
Louisiana Supreme Court Rule XIX, § 12(A):
The core legal issue in this matter relates to the interpretation and effect of Rule XIX, § 12. Rule XIX is entitled "Rules for Lawyer Disciplinary Enforcement;" Section 12 is entitled "Immunity" and provides immunity from civil suits and criminal prosecutions. Specifically, this court is called upon to decide whether a violation of Rule XIX, § 12(A) can be the basis for discipline and the imposition of sanctions.
Rule XIX, § 9(a) states that it shall be ground for discipline for a lawyer to "violate or attempt to violate the Rules of Professional Conduct, or any other rules of this jurisdiction regarding professional conduct of lawyers." Clearly, Rule XIX, § 12(A) is not a provision of the Rules of Professional Conduct. See Louisiana State Bar Association (LSBA) Articles of Incorporation, Art. XVI, Rules of Professional Conduct, Rule 1.0, et seq. Thus, the sole question presented is whether Rule XIX, § 12(A) is one of the "other rules of this jurisdiction regarding professional conduct of lawyers."
It will be helpful to consider these provisions in their historical perspective.
In the late 1980s, the Louisiana Supreme Court recognized that the state bar was experiencing an "ethics crisis." Address by Chief Justice John A. Dixon, Press Conference (Feb. 6, 1990), cited in The New Louisiana Disciplinary Enforcement Rules v. The Old Rules: A Comparison, 36 Loy. L.Rev. 433 (1990). With a significant increase in this state's lawyer population, the number and complexity of complaints had increased, overburdening the then existing disciplinary system. This court requested that the American Bar Association (ABA) Standing Committee on Professional Discipline evaluate Louisiana's disciplinary enforcement procedures. Id. at 438. An ABA team came to Louisiana and conducted the evaluation, and thereafter issued a report, "Professional Discipline for Lawyers and Judges," on the areas of Louisiana's system that the team concluded were in need of revision.[4] After the submission of the report in July of 1987, this court appointed a committee to review the ABA's findings. Id.
However, in 1989, while the local review was pending, the ABA adopted the Model Rules for Lawyer Disciplinary Enforcement. This court responded by discontinuing its own evaluation project and adopting and promulgating the ABA's new model rules regarding disciplinary enforcement, La. S.Ct. Order (Feb. 6, 1990), making Louisiana the first state to use the new ABA Model Rules for Lawyer Disciplinary Enforcement. Id. at 433.
*533 In 1990, Article XV, "Discipline and Disbarment of Members," of the LSBA Articles of Incorporation was vacated and repealed. In its place, Louisiana Supreme Court Rule XIX was reenacted[5] to incorporate the "Rules for Lawyer Disciplinary Enforcement." The "Rules of Professional Conduct" remained and still are in Article XVI of the LSBA Articles of Incorporation.[6] However, the reenacted Rule XIX changed the disciplinary procedure and the sanctions imposed for professional misconduct. Id. at 445. Additionally, there was a change in the provision related to a privilege for complaints to the disciplinary committee of the LSBA.
The previous "Privileges and Immunities" provision, Art. XV, § 13 provided, in pertinent part:
[1] Complaints filed with the Committee in accordance with these rules shall be absolutely privileged
and
[2] all communications and evidence predicated thereon shall not be admissible in any court in this State in proceedings against the person filing such complaints.
The replacement for Art. XV, § 13, Paragraph A of Section 12, of Rule XIX entitled "Immunity,"[7] states, in pertinent part:
[1] Communications to the board, hearing committees, or disciplinary counsel relating to lawyer misconduct or disability and testimony given in the proceedings shall be absolutely privileged,
and
[2] no lawsuit predicated thereon may be instituted against any complainant or witness.
Obviously, both provisions create an absolute privilege. However, Art. XV, § 13 implicitly recognized that complainants could be sued, whereas Rule XIX, § 12(A) prohibits such suits.
The key words in both provisions are "absolutely privileged." A "privilege" as it relates to the law of libel and slander is defined as an "exemption from liability for the speaking or publishing of defamatory words concerning another, based on the fact that the statement was made in the performance of a duty, political, judicial, social, or personal." BLACK'S LAW DICTIONARY, 1360(4th ed.1968). An "absolute privilege" is defined as a "privilege that immunizes an actor from suit, no matter how wrongful the action might be, and even though it is done with an improper motive." BLACK'S LAW DICTIONARY, 1215 (7th ed.1999). Louisiana jurisprudence has consistently held that communications made in judicial or quasi-judicial proceedings carry an absolute privilege so that *534 witnesses, bound by their oaths to tell the truth, may speak freely without fear of civil suits for damages. Knapper v. Connick, 96-0434, p. 3 (La.10/15/96), 681 So.2d 944, 946, citing Bienvenu v. Angelle, 254 La. 182, 223 So.2d 140 (1969), overruled on other grounds, Gonzales v. Xerox Corporation, 254 La. 182, 320 So.2d 163 (1975). This court has recognized the difference between absolute immunity, which defeats a suit at the outset, and qualified immunity, which depends on circumstances and motivations and often must be established by evidence at trial. Knapper, 96-0434 at 6, 681 So.2d at 948.
The key words in the additional sentence of Rule XIX, § 12(A) and no lawsuit predicated thereon may be instituted against any complainant or witness are "instituted" and "no lawsuit." In the context of this legal rule, the word "instituted" is defined as "to begin or start; commence." BLACK'S LAW DICTIONARY, 801 (7th ed.1999). The words "no lawsuit" clearly foreclose the institution of any lawsuit whatsoever, regardless of the cause or causes of action pled therein. Thus, Respondent's argument in the instant matter that Rule XIX, § 12(A), as applied by this court, leaves the door open for suits for malicious prosecution and/or abuse of process is untenable. It is absolutely clear that Rule XIX, § 12(A) prohibits all lawsuits predicated on the complaint or the testimony, and, thus, provides additional protection to complainants and witnesses that the former rule did not provide. The policy decision by this court to protect those who file complaints against lawyers from retaliatory lawsuits avoids a chilling effect upon the proper function of the lawyer regulatory system. This provision is consistent with the overall purpose of Rule XIX to engender confidence by the public in Louisiana's lawyer regulatory system.
The ABA "Commentary" regarding the portion of Rule 12 "Immunity" at issue in this case states, in pertinent part:
A policy of conferring absolute immunity... encourages those who have some doubt about a lawyer's conduct to submit the matter to the proper agency, where it may be examined and determined. Without immunity, some valid complaints will not be filed. The individual lawyer may suffer some hardship as the result of the occasional filing of a malicious complaint, but a profession that wants to retain the power to police its own members must be prepared to make some sacrifice to that cause.
It is unlikely that even a malicious complaint will cause any damage beyond some inconvenience. The members of the agency to whom the complaint is submitted will surely not hold it against the lawyer, for their very function is to separate meritorious from undeserving complaints.
Model Rules for Lawyer Disciplinary Enforcement, Rule 12: Immunity, Commentary (1993 ed.).
This Rule 12 Commentary explains and confirms the absolute privilege accorded to communications to the board, hearing committees, or disciplinary counsel and the immunity from civil suit accorded to complainants and witnesses.[8] However, the *535 Rule 12 Commentary does not address the issue in this case: whether an attorney is subject to discipline for filing suit against the complainant.
As previously stated, our decision is based on whether Section 12(A) can be considered among "other rules of this jurisdiction regarding professional conduct of lawyers" as provided in Rule XIX § 9(a). We find it disingenuous to assert otherwise. Admittedly, Section 12(A) does not mention lawyers. However, the provisions specify an absolute privilege for communications and a prohibition of the filing of civil suits against complainants and witnesses. Thus, the prohibition of Section 12(A) addresses itself to lawyers, who in most cases are the subjects of the privileged communications and who would be the ones to institute suits against complainants or witnesses.[9] Thus, we conclude Rule XIX, § 12(A) is a "rule regarding professional conduct of lawyers" and makes lawyers susceptible to discipline for violation of its provisions.
Considering the facts as found by the hearing committee and the conclusions of the board, we agree that Respondent, by filing suit against a complainant for defamation not only violated the spirit of Rule XIX, § 12(A), but was in direct violation of its prohibitions, an action that subjects him to the disciplinary process. See Rule XIX, § 9(a).
In his defense to this court, Respondent argues that the Rules for Lawyer Disciplinary Enforcement cannot form the basis of misconduct or discipline. In support of this contention Respondent cites In re Harris, 03-0212, (La.5/9/03), 847 So.2d 1185. In that case, the ODC filed one count of formal charges alleging that respondent's behavior in relation to a previous disciplinary proceeding (Harris I), had been in violation of a laundry list of rules; he allegedly "engaged in conduct prejudicial to the administration of justice in violation of Rule 8.4(d); and, in bad faith, obstructed the disciplinary process in violation of Rules 8.1(c) and 8.4(g) and Supreme Court Rule XIX, § 12(A)." Harris, 03-0212 at 5, 847 So.2d at 1188.
In the instant case, Respondent relies on the following language: "[T]he board noted that [Supreme Court Rule XIX, § 12(A) ] does not provide a disciplinary remedy. Accordingly, the board declined to find that respondent violated Rule XIX, § 12(A)." Harris, 03-0212 at 14, 847 So.2d at 1193-1194. Consideration of that statement in the context of the entirety of this court's opinion reveals that Respondent's reliance is misplaced. The statement was included in the "Disciplinary Board Recommendation." Although this court did not specifically repudiate the statement by the board, it is clear from our "Discussion," that violation of Rule XIX, § 12(A) played a significant part in our decision that permanent disbarment was the proper sanction. We stated:
Bar disciplinary matters come within the original jurisdiction of this court. La. Const, art. V, § 5(B). Consequently, *536 we act as triers of fact and conduct an independent review of the record to determine whether the alleged misconduct has been proven by clear and convincing evidence....
The record supports a finding of professional misconduct that is unquestionably serious in nature. Respondent manufactured evidence and presented perjured testimony in an attempt to avoid lawyer discipline, and he threatened his former clients with civil litigation if either of them testified against him in the disciplinary proceeding. By engaging in these practices, respondent has violated the most fundamental duty of an officer of the court.
Having found evidence of professional misconduct, the sole issue presented for our consideration is the appropriate sanction for respondent's actions....
Respondent's conduct clearly violated duties owed to the public, the legal system, and the profession. In our view, respondent's breach of ethics was profound and directly affected the lawyer disciplinary system and the administration of justice. [Citations omitted; emphasis supplied.]
Harris, 03-0212 at 15-16, 847 So.2d at 1194.
In the board's recommendation to this court in the instant case, the board stated:
Respondent's post-hoc rationalizations ignore the Section 12(A) proscription which provides that "no lawsuit predicated" upon any communications to the board, hearing committee or disciplinary counsel "may be instituted against any complainant or witness." [Emphasis added.] Respondent's defamation suit against Ms. Raspanti based upon her complaints to Disciplinary Counsel flies squarely in the face of the Section 12(A) prohibition.
Unlike Respondent, we cannot ignore the plain terms of Section 12(A). We believe the Supreme Court said what it meant and meant what it said in Section 12(A). That provision is essential to the effective functioning of the disciplinary process.
We agree with the board that violation of Rule XIX § 12(A) can subject an attorney to discipline and a finding of professional misconduct, which in turn supports the imposition of sanctions.
Rules of Professional Conduct:
We now consider whether Respondent can be sanctioned for his actions.
Rule 8 of the Rules of Professional Responsibility is entitled "Maintaining Integrity of the Profession," and its five parts run the gamut of provisions regarding bar admissions and disciplinary matters to a provision outlining the jurisdiction of the disciplinary process.
Rule 8.4 is entitled "Misconduct" and provides a list of various acts that constitute professional misconduct. Rule 8.4's definition of professional misconduct is a corollary of Rule XIX, § 10(A), which provides that misconduct shall be grounds for one or more of the sanctions listed therein. Rule 8.4 provides, in pertinent part:
It is professional misconduct for a lawyer to:
(a) Violate or attempt to violate the Rules of Professional Conduct, knowingly assist or induce another to do so, or do so through the acts of another;
. . . .
(d) Engage in conduct that is prejudicial to the administration of justice.
We agree with the committee and the board that Respondent's behavior breached Rule 3.1 of the Rules of Professional Conduct and, thus, constituted professional misconduct pursuant to Rule 8.4(a). Rule 3 of the Rules of Professional *537 Conduct is entitled "Advocate"[10] and sets forth the standards a lawyer must follow when he or she assists, defends, pleads, or prosecutes. Rule 3.1, which is the first of eight parts, is entitled "Meritorious Claims and Contentions"; it provides, in pertinent part:
A lawyer shall not bring or defend a proceeding, or assert or controvert an issue therein, unless there is a basis in law and fact for doing so that is not frivolous, which includes a good faith argument for an extension, modification or reversal of existing law.
The hearing committee and the board concluded that Respondent's civil suit against his former client, which asserted a claim of defamation arising from her complaints to the ODC, was frivolous in nature and violated Rule 3.1. Although Respondent's suit was also a suit for the payment of legal fees and contained assertions of defamatory statements in venues other than disciplinary proceedings, Rule 3.1 clearly provides that an "issue" in a law suit must have a basis in law which is not frivolous. As a practicing attorney Respondent is charged with knowing the law, including the provision of Rule XIX § 12(A) that completely bars his filing a petition that alleges defamation by the complainant. That provision has been in place since 1990, more than a decade before Respondent filed his law suit.
A reasonable lawyer in Respondent's position would have easily concluded that his defamation lawsuit against his former client predicated on her complaints to the ODC was meritless. Because there existed a clear legal bar to the filing of a suit for defamation predicated on Ms. Raspanti's complaints to the ODC, we agree with the committee and the board that Respondent's suit was frivolous and violated Rule 3.1. We are not the first state to find that the filing of a civil suit in violation of absolute immunity afforded complainants is a frivolous action that violates Rule 3.1. See In re Spikes, 881 A.2d 1118, 1125 (D.C.2005); for violations of similar rules, see also, Conduct of Adams, 293 Or. 727, 739-740, 652 P.2d 787 (1982); Columbus Bar Association v. Elsass, 86 Ohio St.3d 195, 713 N.E.2d 421 (1999).
In arguing that his suit against Ms. Raspanti was not frivolous Respondent relies on Goldstein v. Serio, 496 So.2d 412 (La. App. 4 Cir.1986), and Sommer v. State, Department of Transportation and Development, 97-1929 (La.App. 4 Cir. 3/29/00), 758 So.2d 923.[11]
In Goldstein, attorneys filed a lawsuit against former clients after the Louisiana State Bar Association's Committee on Professional Responsibility dismissed the former clients' complaints against the attorneys. The lawsuit sought damages for defamation, malicious prosecution, and abuse of process. The trial court held that the complaints to the Louisiana State Bar Association were absolutely privileged and maintained the exception of no cause of *538 action. The court of appeal affirmed the trial court's ruling with respect to the defamation claim. However, it reversed the ruling with respect to the malicious prosecution and abuse of process claims, finding that absolute privilege is not an affirmative defense when "the crux of the action is not the statements made but the fact that a proceeding was maliciously and/or illegally pursued." Goldstein, 496 So.2d at 415.
In the instant case, the board noted that Respondent's initial petition alleged defamation, but he subsequently added claims of abuse of process and malicious prosecution. The board noted that the ODC did not make an issue of these claims in its formal charges. Nevertheless, the board rejected the Goldstein argument, concluding that the "no lawsuit" prohibition contained in Section 12(A) is clearly broad enough to encompass suits for malicious prosecution as well as abuse of process. The board opined that in promulgating Section 12(A), this court could have concluded that providing a complainant or witness with an affirmative defense was insufficient protection since affirmative defenses must be pleaded, LSA-C.C.P. art. 1005, and can be waived. We agree with the board's rejection of Respondent's Goldstein argument.
Respondent also cites this court's discussion of Goldstein in Marrogi v. Howard, 01-1106 (La.1/15/02), 805 So.2d 1118, a case involving the privilege of absolute immunity for witnesses in civil litigation. In explaining Goldstein, this court stated, "[T]he privilege applies to preserve candor in the attorney disciplinary system, yet complaints to the bar undertaken in malice or in abuse of process are not worthy of such protection." Marrogi, 01-1106 at 13, 805 So.2d at 1127. However, as the disciplinary board now points out, Goldstein was decided on the basis of LSBA Articles of Incorporation, art. XV, § 13, which did not contain the "no lawsuit" clause now embodied in Section 12(A). The Marrogi opinion did not address Rule XIX, § 12(A), and it is clearly distinguishable from a case in the lawyer disciplinary system.
Because we have determined that Respondent's action in filing a civil lawsuit against a complainant violated Rule 3.1, it follows that he engaged in professional misconduct pursuant to Rule 8.4(a) which states, "It is professional misconduct for a lawyer to ... violate the Rules of Professional Conduct."
Finally, even if we were inclined to disagree with the hearing committee and the board concerning their conclusions that Respondent violated Rule 3.1 and, thus, engaged in professional misconduct pursuant to Rule 8.4(a), we conclude that the gravamen of the ODC's formal charges against Respondent lies in misconduct pursuant to Rule 8.4(d), i.e., conduct that is prejudicial to the administration of justice. Filing a lawsuit based on a cause of action which is specifically prohibited by Rule XIX, § 12(A) has a chilling effect on complaints against attorneys and is prejudicial to the administration of justice within the arena of attorney discipline.
In the instant case, where suit against a complainant was actually filed (as contrasted with a threatened lawsuit, as in Harris, supra) and continued (with various amendments) in violation of Rule XIX, § 12(A), we conclude that Respondent engaged in professional misconduct pursuant to Rule 8.4(d). Accord, In re Smith, 989 P.2d 165, 172 (Colo.10/4/99); Spikes, supra.
Louisiana Supreme Court Rule XIX, § 10. Sanctions:
Having found evidence of professional misconduct, we now consider the sole remaining issue, i.e., the appropriate sanction for Respondent's actions. In determining *539 a sanction, we are mindful that disciplinary proceedings are designed to maintain high standards of conduct, protect the public, preserve the integrity of the profession, and deter future misconduct. Louisiana State Bar Association v. Reis, 513 So.2d 1173 (La.1987). The discipline to be imposed depends upon the facts of each case and the seriousness of the offenses involved, considered in light of any aggravating and mitigating circumstances. Louisiana State Bar Association v. Whittington, 459 So.2d 520 (La.1984).
Rule XIX, § 10(A) provides that misconduct shall be ground for this court to impose, among others, one or more of the following sanctions: disbarment, suspension, probation, reprimand.
Rule XIX, § 10(C) provides that this court shall consider the following factors in imposing sanctions: 1) whether the lawyer has violated a duty owed to a client, to the public, to the legal system, or to the profession; 2) whether the lawyer acted intentionally, knowingly, or negligently; 3) the amount of the actual or potential injury caused by the lawyer's misconduct; and 4) the existence of any aggravating or mitigating factors.
In the instant case, the hearing committee recommended Respondent be reprimanded. Neither the ODC nor the Respondent specifically objected to this recommendation. As previously stated, the hearing committee determined that Respondent violated the spirit of Rule XIX, § 12(A) and also violated Rules 3.1, 8.4(a), and 8.4(d) of the Rules of Professional Conduct. The committee also determined that Ms. Raspanti suffered no direct harm; Ms. Raspanti filed at least two non-meritorious complaints against Respondent; and Respondent only represented her at the insistence of their parents. The committee found Respondent's frustration with his sister was understandable, but nevertheless resulted in a rule violation that called for a sanction. The only aggravating factor found by the committee was Respondent's refusal to acknowledge the wrongful nature of his conduct. The committee felt constrained to recognize a violation and recommend a sanction. Accordingly, the committee recommended that Respondent be publicly reprimanded.
On the other hand, the board determined Respondent knowingly violated duties owed to the legal system and to Ms. Raspanti; caused harm to Ms. Raspanti in forcing her to defend the defamation claim; and took retaliatory action that threatens to undermine the disciplinary system.
In aggravation, the board found the following factors: refusal to acknowledge the wrongful nature of the conduct, lack of remorse, substantial experience in the practice of law, and indifference to making restitution or minimizing the harmful effects of the misconduct. The only mitigating factor was the absence of a prior disciplinary record.
Relying on the ABA's Standards for Imposing Lawyer Sanctions, the board determined that the baseline sanction is suspension. The board recommended that Respondent be suspended for one year with all but three months deferred. The board further recommended that Respondent be placed on unsupervised probation for nine months following the active period of the suspension, subject to the condition that any misconduct during this period may be ground for making the deferred suspension executory or imposing additional discipline, as appropriate. Finally, the board recommended that Respondent be assessed with all costs and expenses of these proceedings.
Our de novo review of the record in this case convinces us that the recommendation *540 of the hearing committee for a public reprimand is more in line with the nature of Respondent's violation. Our choice of the most lenient discipline available to us pursuant to Rule XIX, § 10 should not be interpreted as deprecating the importance of the rule that was violated in the instant case. Thus, we issue the following caveat.
Considering that the facts of this case were undisputed by Respondent and the ODC, we were left with a single, novel issue: the interpretation and application of Rule XIX, § 12(A). We have resolved that issue by finding the provision accords complainants absolute immunity from civil suits. As the instant case illustrates, not all complainants will be equally justified in making complaints to the lawyer disciplinary system; yet all complainants will have equal, absolute immunity. Granting a complainant absolute immunity when filing a complaint against a lawyer is a part of the disciplinary system adopted from the ABA Model Rules for Lawyer Disciplinary Enforcement in 1990, which are designed to regulate attorneys and sanction those who violate the ethical standards of the legal profession.
Respondent has violated a clear, unambiguous rule that has been in place for almost two decades; if he did not know that filing suit against his former client alleging defamation (and later abuse of process and malicious prosecution) was completely prohibited, he should have known. Louisiana is not the only state to find that violation of the absolute immunity rule is also a violation of the Rules of Professional Conduct prohibiting frivolous lawsuits and interference with the administration of justice. See Spikes, supra.
However, there are several factors in mitigation of Respondent's knowing violation. First, we are issuing a sanction for a matter for which no one has been sanctioned previously. There are statements in the jurisprudence that might indicate the possibility of our arriving at an interpretation of Rule XIX, § 12(A) contrary to the interpretation we issue today. For example, the board in Harris, supra, as recently as 2003, indicated Section 12(A) did not provide a sanction; the board in the instant case found the rule clear and unambiguous.
Second, we do not consider Respondent's lack of remorse an aggravating factor; instead, we find he had a principled belief he was not engaging in inappropriate behavior. While we disagree with his belief, we are at the same time convinced he was sincere in his belief, thus, making any finding of a lack of remorse inappropriate.
Third, we note he has no prior disciplinary record during his lengthy career.
Next, although Respondent cannot avoid discipline by relying on the fact that he was represented by counsel in his suit against his sister, that fact may be considered in mitigation.
Finally, as did the hearing committee, this court recognizes that Respondent represented his sister only because his parents urged him to do so. Unlike the completely unprovoked threat of a civil suit in Harris, Respondent's suit apparently was filed in an attempt to put an end to what the ODC determined to be baseless complaints on the part of his former client.
Regardless of the mitigating factors listed above, we find that Respondent in failing to refrain from filing a civil suit violated a duty he owed to a former client, the public, the legal system and the profession. He acted with, at least, constructive knowledge of a prohibition. Although he may have caused injury to his former client because she was called upon to defend herself, such injury was not substantial *541 because there was ongoing litigation regarding a fee dispute.
Accordingly, we conclude that a public reprimand issue against Respondent, and that he be cast for costs of these proceedings.
PUBLIC REPRIMAND IMPOSED; RESPONDENT CAST FOR COSTS OF THESE PROCEEDINGS.
NOTES
[1] Respondent filed an objection in this court to the disciplinary board's recommendation, but the filing was not within the time limits of Louisiana Supreme Court Rule XIX, § 11(G)(1). Ordinarily, the filing of objections in a bar disciplinary case determines how the case is treated. In a "no objection" matter under Rule XIX, § 11(G)(1)(a), this court may enter an order based on the recommended disciplines with written reasons, which may be summary in nature. By contrast, the filing of an objection mandates that the case be scheduled for oral argument under Rule XIX, § 11(G)(1)(b). Despite the fact that this is technically a "no objection" case, we chose to schedule oral argument and docket the case for a full opinion because the issue is res nova with this court.
[2] In December 2003, the trial court granted Ms. Raspanti's motion to dismiss Respondent's defamation claims "based on complaints to the disciplinary board, including the appeal to the Supreme Court." Respondent filed a notice of intent to seek supervisory writs from the trial court's ruling, but it appears that the application was never filed in the court of appeal.
[3] In its recommendation to this court, the disciplinary board noted that the ODC's prehearing memorandum also alleged Respondent's conduct violated Rule 3.1 entitled "Meritorious Claims and Contentions." Respondent thereafter filed a motion to strike allegations relative to Rule 3.1 of the Rules of Professional Conduct. Citing Louisiana State Bar Association v. Keys, 567 So.2d 588, 591 (La. 1990), the hearing committee concluded fair and adequate notice of the nature of the misconduct had been given to Respondent, and therefore, the Rule 3.1 claim could be pursued by ODC.
[4] Suggestions for reform were made concerning: 1) structure of the disciplinary system, such as separation of the duties of the executive counsel from disciplinary duties; 2) intake and docket procedures; 3) investigation; 4) disposition after investigation; and 5) sanctions. The report noted an absence of provisions for complainant appeals and for witness immunity from criminal prosecutions and recommended the addition of same. Although the existing bar rule, Art. XV, § 13, provided an absolute privilege for complaints to the disciplinary committee, but did not provide immunity from the instigation of civil suits, the ABA team did not note that deficiency.
[5] Prior to the reenactment, Louisiana Supreme Court Rule XIX provided: "All matters touching upon the discipline and disbarment of members of the bar shall be governed by Article XV of the Articles of Incorporation of the Louisiana State Bar Association, as amended, and as approved by this court." La. S.Ct. R. XIX (West 1988) (repealed 1990).
[6] The rules are divided into eight categories:
1. Client-Lawyer Relationship;
2. Counselor;
3. Advocate;
4. Transactions with Persons Other Than Clients;
5. Law Firms and Associations;
6. Public Service;
7. Information about Legal Services; and
8. Maintaining Integrity of the Profession.
[7] Immunity from criminal prosecution which had been recommended by the ABA team was enacted in Paragraph B of Section 12, as follows: "Upon application by disciplinary counsel and notice to the appropriate prosecuting authority, the court may grant immunity from criminal prosecution to a witness in a discipline or disability proceeding."
[8] We note that although the wisdom of the rule has been questioned, the rule has been adopted in other states. For example, the Supreme Court of New Jersey has recognized that the strong public policy in favor of maintaining strict adherence to the rules of discipline required the removal of any impediment to the effective functioning of the disciplinary system. Allowing complainants to be vulnerable to lawsuits brought by lawyers against whom they complained would be an undesirable impediment. Allowing such suits might eliminate some maliciously motivated complaints, but legitimate complaints would similarly be chilled. The public policy considerations making unacceptable any such chilling effect is deemed important enough to overcome well-founded arguments against such immunity. In re Hearing on Immunity for Ethics Complainants, 96 N.J. 669, 671-672, 477 A.2d 339, 340 (1984).
[9] It is conceivable that a non-lawyer would be defamed in a communication by a complainant or witness in an attorney-disciplinary proceeding. In which case, Section 12(A) nevertheless prohibits filing a suit against complainants and witnesses, and attorneys would be subject to discipline for filing suit on behalf of non-lawyers. Such allegedly defamed persons would be in violation of this rule if they filed in proper person, but there would be no sanctions against non-lawyers.
[10] Compare with Rule 2, which is entitled "Counselor," and includes Rule 2.1, as follows: "In representing a client, a lawyer shall exercise independent professional judgment and render candid advice. In rendering advice, a lawyer may refer not only to law but to other considerations such as moral, economic, social and political factors, that may be relevant to the client's situation." The roles of counselor and advocate illustrate the dichotomy of a lawyer's practice.
[11] In Sommer, the court of appeal held defamatory statements by a State employee to the United States Customs Service about a Customs Service employee were not protected by absolute judicial privilege because the privilege does not protect against intentional destruction of the employee's career. As previously stated, the board rejected Respondent's defense based on Sommer because that case did not involve disciplinary proceedings. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1032728/ | NRS 17.115(4) and NRCP 68, the district court must analyze the factors
established in Beattie v. Thomas, 99 Nev. 579, 588-89, 668 P.2d 268, 274
(1983). Similarly, when determining the reasonable value of an attorney's
services in a motion for attorney fees, the district court must analyze the
factors established in Brunzell v. Golden Gate National Bank, 85 Nev. 345,
349-50, 455 P.2d 31, 33 (1969). The district court must then provide
sufficient reasoning and findings concerning those factors in its order.
Shuette, 121 Nev. at 865, 124 P.3d at 549. But if the district court's order
fails to provide such reasoning and findings, we will nevertheless defer to
the district court's discretion in awarding attorney fees if the record
indicates that the district court properly evaluated the Beattie and
Brunzell factors. Wynn v. Smith, 117 Nev. 6, 13, 16 P.3d 424, 428-29
(2001).
In this case, appellant argues that attorney fees were
improperly awarded because appellant's former counsel controlled the
case, did not inform appellant about the case, took actions without
appellant's knowledge or permission, and made mistakes during the case.
Appellant's arguments, however, are not relevant to the attorney fees
determination here. See Beattie, 99 Nev. at 588-89, 668 P.2d at 274;
Brunzell, 85 Nev. at 349-50, 455 P.2d at 33; see also Lange v. Hickman, 92
Nev. 41, 43, 544 P.2d 1208, 1209 (1976) (holding that notice to an attorney
is notice to the client, and if the attorney neglects the client's case, the
client's recourse is an action against the attorney).
Here, although the district court failed to set forth any
findings of fact or its reasoning in the order awarding attorney fees,
respondent's motion for attorney fees contains a discussion of the Beattie
and Brunzell factors and a detailed breakdown of incurred attorney fees,
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and the district court's order indicates that a hearing was held on the
contested attorney fees motion. Thus, although written findings
supporting an attorney fees award are preferred for appellate review,
Wynn, 117 Nev. at 13, 16 P.3d at 428-29, the record indicates that the
district court evaluated the Beattie and Brunzell factors and awarded
respondent approximately half of its requested fees as reasonable attorney
fees. In this case, we will defer to the district court's discretion in
awarding attorney fees. Id. Accordingly, having considered appellant's
arguments and the record on appeal, we conclude that the district court
did not abuse its discretion. We therefore
ORDER the judgment of the district court AFFIRMED.
J.
Douglas
J.
Saitta
cc: Hon. Valerie Adair, District Judge
Adrian Niculescu
Littler Mendelson/Las Vegas
Eighth District Court Clerk
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https://www.courtlistener.com/api/rest/v3/opinions/1032731/ | herniated disc in March 2008. 1 In April 2008, MGM Mirage's insurer,
appellant Chartis Insurance, accepted respondent's workers' compensation
claim, and in so doing, it categorized respondent's injury as a "lumbar
strain." 2
After his claim for a lumbar strain had been accepted,
respondent requested temporary total disability (TTD) benefits from
Chartis. Respondent submitted a physician's progress report completed by
his own neurosurgeon that certified respondent as TTD from the date of
his initial January 2008 examination. Chartis denied respondent's
request for TTD benefits, as did a hearing officer.
Respondent then appealed the denial to an appeals officer.
Before the appeals officer, appellants argued that respondent's herniated
disc was not a compensable injury because it was a preexisting condition
that was not aggravated by respondent's November 2007 fall. The appeals
officer disagreed and awarded TTD benefits to respondent, as well as
medical benefits. Appellants then filed a petition for judicial review,
which the district court denied. This appeal followed.
"This court, like the district court, reviews an appeals officer's
decision for clear error or abuse of discretion." Dickinson v. Am. Med.
Response, 124 Nev. 460, 465, 186 P.3d 878, 882 (2008); see also NRS
233B.135(3) (setting forth the standard for judicial review of an agency's
decision). Although we review issues of law de novo, "the appeals officer's
'Respondent underwent a follow-up surgery roughly one year later.
2 Wenote that AIG, and not appellant Chartis, was actually the
insurer responsible for the initial processing of respondent's claim. We
refer to Chartis in this disposition for the sake of clarity.
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fact-based legal conclusions are entitled to deference and will not be
disturbed if they are supported by substantial evidence. Substantial
evidence is evidence that a reasonable person could accept as adequately
supporting a conclusion." Dickinson, 124 Nev. at 465-66, 186 P.3d at 882
(footnotes omitted). Moreover, our review is limited to the record before
the appeals officer. Id. at 466, 186 P.3d at 882; see NRS 233B.135(1)(b).
Substantial evidence supports the appeals officer's finding that
respondent's fall aggravated his preexisting condition
Under NRS 616C.175, if an employee sustains a work-related
injury that "aggravates, precipitates or accelerates" a nonwork-related
preexisting condition, the employee is entitled to compensation "unless the
insurer can prove by a preponderance of the evidence that the subsequent
injury is not a substantial contributing cause of the resulting condition."
NRS 616C.175(1). Appellants argued before the appeals officer that there
was no evidence to support respondent's contention that his fall
aggravated, precipitated, or accelerated his preexisting condition. Rather,
appellants contended that the pain respondent experienced following his
fall was merely a recurrence of the pain associated with his already-
herniated disc. The appeals officer disagreed and awarded TTD benefits
to respondent.
On appeal, appellants contend that it was clearly erroneous
for the appeals officer to find that respondent's fall aggravated his
herniated disc. We disagree, as substantial evidence supports the appeals
officer's finding. First, respondent testified that immediately before his
fall, he was able to discharge his occupational duties, whereas
immediately after his fall and in the ensuing days, he struggled to stand
under his own power. This is the epitome of an "aggravation." See Grover
C. Dils Med. Ctr. v. Menditto, 121 Nev. 278, 286-87, 112 P.3d 1093, 1099
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(2005) (indicating that an "aggravation" is "the result of a specific,
intervening work-related trauma," whereas a "recurrence" is when
" symptoms of an original injury persist and when no specific incident can
independently explain the worsened condition"). Moreover, the physician
who treated respondent after his fall referred him to a neurosurgeon,
which is something that his pre-fall treating physicians never did.
Finally, the doctor who conducted an independent review of respondent's
medical records expressly opined that respondent's surgeries were "done
as a direct result of the industrial accident."
Thus, substantial evidence supports the appeals officer's
finding that respondent's fall aggravated his herniated disc. NRS
616C.175(1); Grover C. Dils Med. Ctr., 121 Nev. at 286-87, 112 P.3d at
1099. As this was the only meaningful argument that appellants put forth
before the appeals officer to support the denial of TTD benefits, the officer
did not clearly err in awarding these benefits. 3 Dickinson, 124 Nev. at
465-66, 186 P.3d at 882; NRS 233B.135(1)(b).
3Appellants argued alternatively that TTD benefits were
unwarranted because respondent moved out of state shortly after his fall,
which, according to appellants, prevented them from offering respondent
modified light-duty employment. See NRS 616C.475(5)(b) (relieving an
employer of the obligation to pay TTD benefits if the employer offers the
employee light-duty employment that complies with restrictions imposed
by the employee's physician). Appellants presented no evidence to the
appeals officer to suggest that they had a viable light-duty employment
offer for respondent and were simply unable to communicate this offer to
respondent or his attorney. Accordingly, the appeals officer did not clearly
err in rejecting this argument.
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Medical benefits were properly awarded once the appeals officer determined
that respondent's herniated disc was a compensable injury
Appellants contend that the appeals officer improperly
awarded medical benefits for the treatment associated with respondent's
herniated disc because appellants initially accepted respondent's claim for
only a "lumbar strain" and respondent did not directly challenge the scope
of his claim. We disagree. Because appellants' primary argument before
the appeals officer was that respondent's herniated disc was not
aggravated by his fall, the issue of whether his herniated disc was a
compensable injury was squarely before the appeals officer. 4 See NRS
616C.360(2) (indicating that an appeals officer must hear any matter
raised before him or her on its merits). Thus, once the appeals officer
determined that the herniated disc was a compensable injury, medical
benefits were clearly part of the "compensation" to which respondent was
entitled. See NRS 616A.090 (defining "compensation" to include "accident
benefits"); NRS 616A.035(1) (defining "accident benefits" as "medical,
surgical, hospital or other treatments").
In sum, the award of TTD benefits was not clearly erroneous
because substantial evidence supported the appeals officer's finding that
respondent's fall aggravated his herniated disc. Dickinson, 124 Nev. at
465-66, 186 P.3d at 882; NRS 233B.135(1)(b). Additionally, the officer
properly awarded medical benefits as part of the compensation to which
4We note that the appeals officer's May 2009 interim order expressly
stated as much: "[T]here remains an underlying medical issue in this
appeal as to whether the claim includes the disc pathology and subsequent
surgery or whether the claim is limited to a [lumbar] strain only with all
other conditions denied."
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respondent was entitled. NRS 616A.090; NRS 616A.035. Accordingly, we
affirm the district court's denial of appellants' petition for judicial review. 5
It is so ORDERED.
cc: Chief Judge, The Eighth Judicial District Court
Hon. Jack B. Ames, Senior Judge
Janet Trost, Settlement Judge
Lewis Brisbois Bisgaard & Smith, LLP/Las Vegas
Michael Paul Wood
Eighth District Court Clerk
5Any concerns about respondent's TTD certification from his
neurosurgeon that were not properly advanced as arguments to the
appeals officer were not considered on appeal. See City of Las Vegas v.
Lawson, 126 Nev. , n.2, 245 P.3d 1175, 1179 n.2 (2010) (indicating
that a party is precluded from raising an argument on appeal that was not
raised before the appeals officer); Edwards v. Emperor's Garden Rest., 122
Nev. 317, 330 n.38, 130 P.3d 1280, 1288 n.38 (2006) (noting that this court
need not consider an issue when a party fails to provide cogent argument
supported by salient authority).
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https://www.courtlistener.com/api/rest/v3/opinions/1603952/ | 8 So.3d 498 (2009)
Benicia DEMEDRANO, Appellant,
v.
LABOR FINDERS OF the TREASURE COAST and Amisure Insurance Company, Appellees.
No. 1D06-6122.
District Court of Appeal of Florida, First District.
May 13, 2009.
*499 Kip A. Davis and Jeffrey Friedman of Vassallo & Bilotta, P.A., Palm Springs, and Bill McCabe, Longwood, for Appellant.
No appearance for Appellees.
ON MOTION FOR CERTIFICATION
PER CURIAM.
Appellant's motion for certification is DENIED. On the merits, our opinion remains unchanged. We write only to clarify our opinion. Therefore, we withdraw our previous opinion and substitute this opinion in its place.
Claimant's attorneys challenge the Judge of Compensation Claims' (JCC) order denying reimbursement for paralegal costs. They argue the JCC erred by finding he had jurisdiction to review costs to be reimbursed to claimant's attorneys from settlement proceeds and that paralegal time is not a reimbursable cost but is, instead, included within attorney time. We affirm.
A JCC lacks inherent judicial power, such as that given a court of general jurisdiction. See Pace v. Miami-Dade County Sch. Bd., 868 So.2d 1286, 1287 (Fla. 1st DCA 2004). The JCC only has the power expressly set out in chapter 440, Florida Statutes. Id. Section 440.33(1), Florida Statutes, directs that a JCC may "do all things conformable to law which may be necessary to enable the judge effectively to discharge the duties of his or her office."
A JCC is required to approve any attorney's fee paid as a result of a settlement agreement. See § 440.20(11)(c), Fla. Stat. (2004); Eshlibi v. Consol. Box Mfg., 962 So.2d 377 (Fla. 1st DCA 2007); Rodriguez v. Graduate Plastics, Inc., 954 So.2d 629, 630 (Fla. 1st DCA 2007). The attorney's fee is limited to a percentage of the benefits secured. See § 440.34(1), Fla. Stat. (2003).[1] A JCC "shall not approve... a joint stipulation for lump sum settlement... that provides for an attorney's fee in excess of the amount permitted by this section." Id. Because the JCC is authorized to do whatever is necessary to insure that a fee in excess of the fee schedule is not approved, the JCC had jurisdiction to determine whether what claimant's attorney characterized as costs should have been included in the attorney's fee.
*500 Analysis of the attorneys' second argument, that paralegal time is a reimbursable cost, begins with a review of section 57.104, Florida Statutes, enacted in 1987, which reads in part:
In any action in which attorneys' fees are to be determined or awarded by the court, the court shall consider, among other things, time and labor of any legal assistants who contributed nonclerical, meaningful legal support....
This section applies to workers' compensation matters. See Dayco Prods. v. McLane, 690 So.2d 654, 656 (Fla. 1st DCA 1997). Application of section 57.104, Florida Statutes, is mandatory when attorney fees are awarded. See Loper v. Allstate Ins. Co., 616 So.2d 1055, 1061 (Fla. 1st DCA 1993) (holding the trial court "disregarded the mandatory language in section 57.104" when it failed to consider the paralegal's time as reflected in the affidavit filed by Loper's attorney).[2]
The attorneys' argument that the question of costs is controlled by a retainer agreement envisioned by the rules regulating the Florida Bar is without merit. Rules "cannot alter, amend or eliminate" a substantive right. See Heymann v. Free, 913 So.2d 11, 12 (Fla. 1st DCA 2005). Section 440.34(1), Florida Statutes, mandates that the retainer agreement not provide "for compensation [as to fees and costs] in excess of the amount allowed under this section." Thus, a retainer agreement in a workers' compensation matter must comply with both sections 440.34 and 57.104, Florida Statutes.
Here, the JCC reviewed sections 57.104 and 440.34(1), Florida Statutes, Loper, and Dayco Products, and concluded paralegal time was included with attorney time. The change in section 440.34(1), Florida Statutes (2003), as it relates to attorney's fees to be paid pursuant to a joint stipulation for lump sum settlement, altered the basis for determining the fee amount, requiring all fees be based solely upon benefits secured. That change did not alter the long-standing statutory requirement that paralegal time, when it provides "meaningful legal support," be compensated within attorney time. Because paralegal time falls within the ambit of attorney time, the attorney fee paid as a part of lump sum settlement is based on the fee schedule now mandated by the statute and includes paralegal time within the award of attorney time. The JCC correctly concluded the charges for paralegal time were compensated within the statutory fee schedule and were not recoverable from claimant as a separate cost.
AFFIRMED.
KAHN, BENTON, and BROWNING, JJ., concur.
NOTES
[1] The Supreme Court's recent opinion in Murray v. Mariner Health, 994 So.2d 1051 (Fla.2008), is not applicable here. Murray determined that when a claimant is entitled to recover attorney fees from an employer/carrier "as provided by section 440.34(3)(a), (b), (c), or (d), the claimant is entitled to recover `a reasonable attorney's fee,'" and that employer/carrier paid fee is not limited by the formula set out in section 440.34(1), Florida Statutes. Id. at 1053. Here, claimant is paying a fee to his attorney pursuant to a lump sum settlement, a situation which is governed by section 440.34(1), Florida Statutes.
[2] This court recently applied Dayco Products, 690 So.2d at 655, with its reliance on section 57.104, Florida Statutes, in a dispute involving a carrier paid fee, to affirm the JCC's "denial of costs associated with legal assistants," because the claimant's attorney failed "to establish that time spent by these legal assistants was nonclerical." See Moore v. Hillsborough County Sch. Bd., 987 So.2d 1288, 1289 (Fla. 1st DCA 2008). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603959/ | 354 N.W.2d 690 (1984)
STATE of North Dakota, ex rel. John S. LESMEISTER, in his capacity as State Treasurer of the State of North Dakota and as a resident and taxpayer of the State of North Dakota, Petitioner,
v.
Allen OLSON, Robert Wefald, and Kent Jones, as members of the Industrial Commission of North Dakota, and Allen Olson, Kent Jones, Florenz Bjornson, Guy Larson, Henry Schank, Alvin Kramer, Garvin Jacobson, Ray Hutton, and Bernie Voulek, as members of the North Dakota Water Commission, Respondents.
Civ. No. 10719.
Supreme Court of North Dakota.
August 16, 1984.
*691 Thomas F. Kelsch, Sp. Asst. Atty. Gen., of Kelsch, Kelsch, Bennett, Ruff & Austin, Bismarck, for petitioner.
Brian D. Neugebauer, Sp. Asst. Atty. Gen., of Ohnstad, Twichell, Breitling, Rosenvold, Wanner, Nelson, Neugebauer & Maring, West Fargo, for respondents. Appearances by Daniel R. Twichell, Sp. Asst. Atty. Gen., and Timothy E. Pickrell, of Chapman & Cutler, Chicago, Ill.
VANDE WALLE, Justice.
The State of North Dakota, on the relation of the State Treasurer, John Steven Lesmeister, seeks to invoke the original jurisdiction of this court for a declaratory judgment holding certain statutes unconstitutional and seeks an injunction prohibiting the issuance of bonds to finance the Southwest Pipeline. The relevant facts have been stipulated by the parties.
The 1983 Legislative Assembly enacted legislation to provide for the construction and financing of the Southwest Pipeline. The Southwest Pipeline project would attempt to alleviate water shortages in the southwest corner of the State by treating and transporting water from the Missouri River to various communities and industrial users in that portion of the State. The estimated construction cost of the Southwest Pipeline is approximately $100,000,000.
The 1983 Legislature passed three bills which created Chapters 61-24.3 and 61-24.4, N.D.C.C., and amended Section 57-51.1-07, N.D.C.C. Chapter 61-24.3 authorizes construction of the Southwest Pipeline project; Chapter 61-24.4 authorizes the issuance of bonds to finance the project; and the amendment to Section 57-51.1-07 provides that ten percent of monies deposited in the oil extraction tax development fund should be allocated to a sinking fund established for payment of the Southwest Pipeline bonds.
Pursuant to this legislation, the Industrial Commission has adopted and approved a "Construction and Operating Agreement" and an "Agreement Regarding: System Revenue Bonds in the Southwest Pipeline Project" to implement the project. These *692 agreements require the signature of the State Treasurer. The State Treasurer, however, has refused to sign the agreements and has petitioned this court for a determination of the validity of the financing scheme outlined in Chapter 61-24.4. He seeks a declaratory judgment holding the financing scheme unconstitutional and an injunction prohibiting issuance of bonds to finance the project. The respondents, members of the Industrial Commission and the North Dakota State Water Commission, seek a writ of mandamus ordering the State Treasurer to execute the agreements.
Before turning to the merits of this controversy, we must determine whether or not this court has jurisdiction to decide this case. We have recently stated the principles which govern our authority to exercise original jurisdiction in State ex rel. Wefald v. Meier, 347 N.W.2d 562, 564 (N.D.1984):
"Article VI, Section 2, of the North Dakota Constitution, gives this court authority to exercise original jurisdiction and to issue remedial writs as may be necessary to properly exercise the court's jurisdiction. The power vested in this court to issue original writs is a discretionary power which may not be invoked as a matter of right, and this court will determine for itself whether or not a particular case is within its original jurisdiction. State ex rel. Peterson v. Olson, 307 N.W.2d 528 (N.D.1981). It is well settled that the power of this court to issue writs in the exercise of its original jurisdiction extends only to those cases in which the question presented is publici juris, wherein the sovereignty of the State, the franchises or prerogatives of the State, or the liberties of its people are affected. State ex rel. Link v. Olson, 286 N.W.2d 262 (N.D.1979). To warrant the exercise of this court's original jurisdiction, the interests of the State must be primary, not incidental, and the public, the community at large, must have an interest or right which may be affected, State ex rel. Vogel v. Garaas, 261 N.W.2d 914, 916 (N.D.1978)."
We are also concerned with whether or not the State Treasurer has standing to bring the action. This court has indicated that an elected State official to whom no injury can result and to whom no violation of duty can be imputed by reason of the performance of an act in compliance with the requirements of a statute may not question its constitutionality. See State v. Baker, 74 N.D. 244, 21 N.W.2d 355 (1946). A portion of the Syllabus by the Court in Baker states:
"Pursuant to the constitution and the statutes of the state of North Dakota, when a state officer is in doubt as to the constitutionality of a statute, under the terms of which he is called upon to perform a ministerial act, it is his duty to consult with and procure the opinion of the attorney general with respect to the matter and be guided in his action by that opinion until it is superseded by judicial decision. If he follows this course he will be protected and absolved from liability under his oath and on his official bond. If he does not request an opinion from the attorney general, or, having done so disregards it, and refuses to perform as required by the statute, he cannot raise the question of its constitutionality as a defense in a mandamus proceeding to compel performance."
Although Baker involved a mandamus action brought against the State Auditor in which the Auditor raised the constitutionality of the statute sought to be enforced as a defense, whereas this case involves an action brought by the State Treasurer in which he questions the constitutionality of certain statutes, we do not believe that difference is significant.
The holding of this court in Baker has not been superseded in the intervening years, and we recently cited Baker in Haugland v. Meier, 339 N.W.2d 100, 106 n. 6 (N.D.1983). The State Treasurer did not request the opinion of the Attorney General concerning the constitutionality of the *693 statutes he now challenges,[1] nor does he allege that he has any duties other than ministerial duties with regard to the issuance of the bonds. Rather, he urges that we do not apply the holding in Baker because the Attorney General, as a member of the Industrial Commission, is a respondent to the action and it would be a useless act to request his opinion as to the constitutionality of the statutes at issue. Further, the State Treasurer alleges that Baker should not apply because he instituted this action not only as State Treasurer but also as a resident and taxpayer of the State of North Dakota. Neither of these reasons persuades us that the holding of Baker should not be applied in this instance. There is no reason to believe that because the Attorney General is a member of a board charged with implementing statutes enacted by the Legislature he would be unable to perform his statutory duty to consult with and advise State officers and, "when requested give written opinions on all legal or constitutional questions relating to the duties of such officers ..." as specified in Section 54-12-01(6), N.D.C.C. Nor are we impressed with the argument that the State Treasurer also instituted the action as a resident and taxpayer of the State of North Dakota. Every elected official must be a resident of the State as a qualification of office. See Article V, Section 12, North Dakota Constitution. Presumably most of them are taxpayers as well. If we are to accept jurisdiction of this matter, it will be for reasons other than that the rationale of Baker is no longer viable or is not applicable under the facts of this case.
We have no doubt, however, of the significance of this case to the people of the State of North Dakota. It is significant to those who will be served by the Southwest Pipeline, as well as to all taxpayers of the State. It presumably will be significant in the future as a precedent for the Legislature in determining whether or not bond issues for projects the Legislature deems desirable and advisable, and which the Legislature finances with a portion of the tax revenues of the State, are in violation of the limits of indebtedness imposed by our Constitution. The State Treasurer, in his challenge, has raised issues which involve the State debt limitation in our North Dakota Constitution as well as the authority of the Legislature to enact legislation prescribing the use of future tax revenues. The issues raised in this case are publici juris. State ex rel. Wefald v. Meier, supra.
Furthermore, we recognize the action for what it isan action necessary to test the constitutionality of the statutes authorizing the issuance of the bonds in order to determine the marketability of the bonds. We agree with the position taken by the Supreme Court of Montana in Grossman v. State, Mont., 682 P.2d 1319, 1326 (1984), wherein that court, in determining whether or not it should accept jurisdiction of an original action brought to test the validity of statutes authorizing bonds, stated:
"We should without hesitancy recognize this case for what it appears to be: a test case designed to obtain a final judgment on the validity of coal severance tax revenue bonds so that if valid, the bonds will be marketable. We will no longer be qualmish about jurisdiction in a bond issuance case. When the issues are fairly stated, fully explored and vigorously contended, as they appear *694 here, we have a justiciable controversy suitable for final resolution by this Court. Legal niceties must bend on occasion to the reality of the market. The living law moves with the times."[2]
We do not, however, encourage original filings in this court and this opinion should not be construed as a change in our position on that matter. The district courts are open as the initial forum for many such controversies. Similar challenges have been brought in the district court in the past. See, e.g., Nord v. Guy, 141 N.W.2d 395 (N.D.1966), in which an action to challenge the constitutionality of statutes authorizing the issuance of bonds to provide and equip facilities at State-supported institutions of higher education was initiated in the district court by a taxpayer.
But, as the Montana court noted in Grossman, supra, a district court opinion is not sufficiently authoritative to provide underwriters and investors with a final resolution of the constitutional issues involved. Unless we accept jurisdiction the issuance of the bonds will be delayed if district court proceedings are required and the bonds are found valid. If we do not accept jurisdiction and the bonds are found to be invalid, the process of litigation may well extend into or beyond the 1985 Legislative Session. We agree with the Montana Supreme Court it is "when special circumstances, presenting issues of an urgent or emergency nature, exist requiring speedy determination, that we deem it wise to accept original jurisdiction, and to recognize standing of an ordinary taxpayer for that proceeding." Grossman, supra, Mont., 682 P.2d at 1325. Although we have not been advised of the reason that the action challenging the statutes was not filed until June 8, 1984, we note that if we should find constitutional objections which would negate the issuance of the bonds, a decision by us now will allow the 1985 Legislature to consider alternative methods of financing the project. Requiring the action to be litigated initially in district court might preclude the 1985 Legislature from considering such alternatives. We accept jurisdiction.
It is a well-established principle that an enactment of the Legislature is conclusively presumed to be constitutional unless it is clearly shown that the legislation contravenes the State or Federal Constitution. Hall GMC, Inc. v. Crane Carrier Co., 332 N.W.2d 54 (N.D.1983); Patch v. Sebelius, 320 N.W.2d 511 (N.D.1982); Paluck v. Board of County Commissioners, Stark County, 307 N.W.2d 852 (N.D.1981). Because the State Constitution does not confer power on the Legislature, but is a limitation on power, the Legislature "may in the exercise of its power appropriate and expend money for whatever purpose it pleases unless its action violates a limitation found, either expressly or impliedly, in the Constitution." Verry v. Trenbeath, 148 N.W.2d 567, 571 (N.D.1967).
The State Treasurer has raised numerous challenges to the constitutionality of the financing scheme for the Southwest Pipeline. We determine that the following issue is dispositive: Would the issuance of bonds pursuant to Chapter 61-24.4 be in violation of the constitutional debt limit established in Article X, Section 13, of the North Dakota Constitution?
Article X, Section 13, provides:
"The state may issue or guarantee the payment of bonds, provided that all bonds in excess of two million dollars shall be secured by first mortgage upon real estate in amounts not to exceed sixty-five percent of its value; or upon real and personal property of state-owned *695 utilities, enterprises, or industries, in amounts not exceeding its value, and provided further, that the state shall not issue or guarantee bonds upon property of state-owned utilities, enterprises, or industries in excess of ten million dollars.
"No further indebtedness shall be incurred by the state unless evidenced by a bond issue, which shall be authorized by law for certain purposes, to be clearly defined. Every law authorizing a bond issue shall provide for levying an annual tax, or make other provision, sufficient to pay the interest semi-annually, and the principal within thirty years from the date of the issue of such bonds and shall specially appropriate the proceeds of such tax, or of such other provisions to the payment of said principal and interest, and such appropriation shall not be repealed nor the tax or other provisions discontinued until such debt, both principal and interest, shall have been paid. No debt in excess of the limit named herein shall be incurred except for the purpose of repelling invasion, suppressing insurrection, defending the state in time of war or to provide for the public defense in case of threatened hostilities."
It is conceded by the respondents that the bonds in this case are in excess of $2,000,000, are unsecured, and do not fall within any of the listed exceptions to the debt limitation. They contend, however, that the bonds are not subject to the debt limitation because they are not State "debts" under the special-fund doctrine.
We have long recognized the special-fund doctrine as an exception to the constraints of the constitutional debt limitation. See, e.g., Marks v. City of Mandan, 70 N.D. 474, 296 N.W. 39 (1941); Thomas v. McHugh, 65 N.D. 149, 256 N.W. 763 (1934); Lang v. City of Cavalier, 59 N.D. 75, 228 N.W. 819 (1930). The special-fund doctrine was explained in Marks v. City of Mandan, supra, 70 N.D. at 487-488, 296 N.W. at 47:
"From the foregoing cases it may be said that North Dakota has adopted what is generally termed as the `special fund' doctrine as applied to the obligations incurred by municipalities or the state itself with regard to special assessment funds for paving and sewers, contracts for the purchase of electric light plants and the erection of dormitories at state educational institutions. This doctrine may be stated as an established rule of law. It is that, bonds, warrants, contracts, or other obligations issued or entered into by the state, or its municipalities, when specially authorized by statute, do not come within the meaning of the words `debt' or `indebtedness' as used by the debt limitations provisions of the constitution if these obligations are secured by and payable exclusively from revenues to be realized from public property acquired with the proceeds of the obligations or assessments on private property benefited by the special improvements."
We further explained the doctrine in State ex rel. Syvertson v. Jones, 74 N.D. 465, 477, 23 N.W.2d 54, 60 (1946):
"There is no question but that in recent years the "special fund doctrine" has been establishedthat is, the theory that the revenue obtained from some utility or any public improvement is devoted to the debt created by that utility or improvement as the sole source of payment of the indebtedness and thus does not become a public debt of the state within the meaning of the term indebtedness used in consideration of debt limits.... Where a law provides for public utilities or improvements, for a revenue therefrom and that all indebtedness created is payable solely from that revenue and not from state taxation this indebtedness is not taken into consideration in determining the debt limit of the state or municipality."
It was further pointed out in State ex rel. Syvertson v. Jones, supra, that the special-fund doctrine, which had previously been raised before this court only in cases involving the municipal debt limitation, was equally applicable to the State debt limitation contained in the Constitution.
*696 Previous cases in which we have applied the special-fund doctrine have involved bonds to be paid from a special fund consisting of revenues from the project to be funded. See Stark v. City of Jamestown, 76 N.D. 422, 37 N.W.2d 516 (1949) (improvement and expansion of municipal water plant to be funded by revenues from plant); Thomas v. McHugh, supra, (municipal electrical power plant to be funded from plant revenues); Lang v. City of Cavalier, supra, (municipal electrical plant funded by plant revenues likened to a "special assessment fund"). We have not previously had an opportunity to determine whether the special-fund doctrine applies when the fund is derived from a general excise tax of the State, as in this case.[3] There is language in our early cases, however, which strongly suggests that bonds which are funded by State taxes are State "debts" within the meaning of the debt limitation. For example, in State ex rel. Board of University and School Lands v. McMillan, 12 N.D. 280, 304, 96 N.W. 310, 319 (1903), this court stated:
"It requires no argument to show that this is a promise of the state to pay the principal and the interest; and, as we shall hereafter see, it is a promise to pay out of state resources, and a promise which can only be discharged by a resort to taxation.... Without attempting to classify these instruments, it is entirely apparent that they evidence a state debt, every dollar of which, both principal and interest, must inevitably be repaid by a resort to general taxation. The theory is that the interest and income fund will pay these bonds and the interest on them, and that they cast no burden upon the taxpayer. Our answer is that the taxpayer is compelled to pay them."
And, in State ex rel. Syvertson v. Jones, supra, 74 N.D. at 477, 23 N.W.2d at 60, we stated that the special-fund doctrine applies when "a law provides for public utilities or improvements, for a revenue therefrom and that all indebtedness created is payable solely from that revenue and not from state taxation...." [Emphasis added.]
The result urged by the respondents would require us to extend the special-fund doctrine well beyond any prior application of the doctrine by this court. Although we have not previously considered the precise issue presented in this case, the parties have cited numerous cases from other jurisdictions in support of their respective positions *697 on the constitutionality of bonds, funded by excise taxes, which exceed the debt limit. The cases evidence a wide divergence of opinion.
We decline to extend the special-fund doctrine as requested by the respondents, and agree with those jurisdictions which hold that an obligation to be funded from general tax revenues, whether they be ad valorem or excise taxes, is a "debt" within the meaning of the debt limitation provision. Therefore, the special-fund doctrine does not exempt such obligations from the $2,000,000 debt limitation contained in our State Constitution.
We believe that the experiences of the State of Washington point out the potential dangers inherent in extending the special-fund doctrine as urged by the respondents. Prior to 1949, the Supreme Court of Washington had applied the special-fund doctrine in several cases to uphold bonds payable from funds not derived from taxation, but had struck down bonds which were to be financed with State tax dollars. See State v. Martin, 62 Wash.2d 645, 384 P.2d 833 (1963), for a discussion of these early cases. In Gruen v. Tax Commission, 35 Wash.2d 1, 211 P.2d 651 (1949), over the dissent of four justices, the court vastly extended its application of the doctrine, holding that $80,000,000 in bonds issued to provide bonuses to World War II veterans payable from a special fund derived from an excise tax on cigarettes did not violate Washington's constitutional debt limitation provision.
Gruen remained the law of the State of Washington until 1963. During those fourteen years, the Washington Legislature authorized nearly two-thirds of a billion dollars in bonds to fund State construction projects financed primarily by taxes on retail sales, motor vehicles, gasoline, and other motor fuels. State v. Martin, supra. Although the court noted that in relation to the State's total revenues the outstanding bonds actually represented a modest commitment, it was the opportunity for uncontrolled proliferation of special-fund bonds which disturbed the court:
"So it seems that, even as the Gruen case was filed, the seeds of its possible dissolution were sown. Time became its enemy even though the state government, under stare decisis, was obliged to treat it as a guidepost in the funding of badly-needed projects throughout the state. Thus, a single excise on a lone commodity, limited and precise, placed in a special fund for the redemption of bonus bonds, could understandably appeal to the majority of the judges as not constituting a general obligation of the state and hence not violative of the state's debt limit; but the very logic of the holding authorized preemption of portions of the state's general revenues by each succeeding session of the legislature in the form of segregating future sales tax revenues into special funds. So it is that the reasoning of the minority in Gruen, clarified by time and events on the question of debt limitation, now seems more cogent and persuasive." State v. Martin, supra, 62 Wash.2d at 651-652, 384 P.2d at 837.
One of the Gruen dissenters had accurately predicted such a proliferation in warning the majority to heed the experiences of South Carolina:
"[South Carolina] is finding that the breach in the dike of debt limitation made in the cases cited, where bonds for highway construction were to be paid from motor vehicle fuel taxes pledged for that purpose, is rapidly widening.... South Carolina's subsequent experiences might suggest: `Stop! Look! Listen!'" Gruen v. Tax Commission, supra, 35 Wash.2d at 72-73, 211 P.2d at 690-691 (Hill, J., dissenting).
Other courts have also expressed concern that allowing specific tax revenues to constitute a special fund exempt from constitutional debt limitations would, in effect, nullify the debt limits. For example, in Morris v. Board of Regents of University of Nevada, 97 Nev. 112, 115-16, 625 P.2d 562, 564 (1981), the court held that bonds issued to construct buildings at the University of Nevada, to be repaid from the slot *698 machine tax, violated the constitutional debt limitation:
"Were we to accept the proposition that a pledge of any specific tax revenues would be sufficient to invoke the `special fund' doctrine, the constitutional debt limitation would be largely nullified, since the legislature could exempt almost any obligation from its strictures merely by identifying a specific tax from which the obligation could be paid."
Similarly, in State ex rel. Diederichs v. State Highway Commission, 89 Mont. 205, 211-212, 296 P. 1033, 1035 (1931), the Supreme Court of Montana stated:
"Under this contention the Legislature, or the debt-contracting authority, could divide the public revenue into numerous subdivisions, calling one the `road fund,' another the `school fund,' another the `agricultural fund,' another the `public health fund,' and others almost without limit. Debts could then be contracted in unlimited amounts and payable in the far distant future, and still be immune from attack as violating constitutional provisions limiting indebtedness provided each debt was made payable out of some one of the specially designated funds into which all of the revenue collected by taxation from the people had been divided. A mere statement of the proposition carries with it, it seems to us, its own refutation."
See also Taxpayers and Citizens of the Town of Georgiana v. Town of Georgiana, 265 Ala. 654, 93 So.2d 493 (1956); Richards v. City of Muscatine, 237 N.W.2d 48 (Iowa 1975); State ex rel. Ward v. Anderson, 158 Mont. 279, 491 P.2d 868 (1971); State ex rel. Meyer v. Steen, 183 Neb. 297, 160 N.W.2d 164 (1968).
In determining whether or not a special fund may be derived from an excise tax, we are also mindful of the strong public policy considerations which are embodied in the constitutional debt limitation. In Lang v. City of Cavalier, supra, our court stated that such constitutional provisions are intended to serve as a limit to taxation and as a protection to taxpayers. The Supreme Court of South Dakota, in Boe v. Foss, 76 S.D. 295, 77 N.W.2d 1 (1956), suggested that the debt limitation is intended to shield the taxpayers from the burdens of debt service, foster public credit, and restrain one generation from enjoying benefits at the expense of those to come.
We believe that allowing a special-fund exemption for bonds funded from excise taxes would, in effect, nullify the debt limitation and remove the protections which the people of the State of North Dakota reserved unto themselves in Article X, Section 13, of the Constitution. We hold that bonds funded by any general State tax, excise or ad valorem, constitute a "debt" of the State within the meaning of the constitutional debt limitation.
In so holding, we adopt the following statement of the Supreme Court of Washington in State v. Martin, supra, 62 Wash.2d at 661, 384 P.2d at 842-843:
"That the special fund doctrine is a useful and valid tool of government is apparent when one thinks of all of the institutions and devices of government supported by it. But the true test of its application here is not what comes out of the fund, but what goes into it. If the revenues in it derive exclusively from the operation of the device or organ of government financed by the fund, as in the case of a toll bridge, or the operation of the State Liquor Control Board, or from sales or leases of publicly owned lands, any securities issued solely upon the credit of the fund are not debts of the state, but debts of the fund only. But if the state undertakes or agrees to provide any part of the fund from any general tax, be it excise or ad valorem, then securities issued upon the credit of the fund are likewise issued upon the credit of the state and are in truth debts of the state. Hence, we must take care that the employment of peripheral doctrines do not lead us away from the main point of the case. What is a debt of the State of Washington? Any obligation which must in law be paid from any taxes levied generally is, we think, a debt *699 of the state. It matters little whether the tax be ad valorem or an excise."
We are not unmindful that there are courts which have arguably reached the result urged by respondents and have upheld special funds which are supported by general tax revenues. See, e.g., City of Phoenix v. Phoenix Civic Auditorium & Convention Center Association, 100 Ariz. 101, 412 P.2d 43 (1966); Switzer v. City of Phoenix, 86 Ariz. 121, 341 P.2d 427 (1959); City of Palatka v. State, 440 So.2d 1271 (Fla.1983); Miller v. Covington Development Authority, 539 S.W.2d 1 (Ky.1976); In re Request for Advisory Opinion, 400 Mich. 311, 254 N.W.2d 544 (1977); Mims v. McNair, 252 S.C. 64, 165 S.E.2d 355 (1969). See also Moses v. Meier, 148 Or. 185, 35 P.2d 981 (1934); but see Terry v. Multnomah County, 27 Or.App. 15, 554 P.2d 1017 (1976). Some of these decisions may be distinguished on the basis of the particular constitutional provision involved. In addition, some jurisdictions allow the special fund to be financed through any taxes other than ad valorem property taxes. E.g., City of Palatka v. State, supra; State v. City of Daytona Beach, 431 So.2d 981 (Fla. 1983); Mims v. McNair, supra. Article X, Section 1, of the North Dakota Constitution prohibits the levying of an ad valorem property tax by the State, and therefore our State government must rely upon other revenue sources. If we were to extend the special-fund doctrine as Florida and South Carolina have, all State revenues could be used as a source for special funds because none are derived from ad valorem property taxes, and the constitutional debt limitation would be rendered meaningless.
Additional cases could be discussed which hold that tax revenues may not be included within a special fund. E.g., People ex rel. City of Chicago v. Barrett, 373 Ill. 393, 26 N.E.2d 478 (1940); State ex rel. Wyoming Farm Loan Board v. Herschler, 622 P.2d 1378 (Wyo.1981); Witzenburger v. State ex rel. Wyoming Community Development Authority, 575 P.2d 1100 (Wyo. 1978). We have reviewed the authorities on both sides of the issue before us and we are convinced that the reasoning supporting the conclusion we reach today is more persuasive.
We have also considered the respondents' argument that the instant case is distinguishable from the other excise tax cases because the oil extraction tax is a nontraditional tax on a depletable resource. They contend that because the oil extraction tax is less "comprehensive" than the taxes which supported the bonds in the various cases we have followed, a different result is warranted. We see no logical basis for distinguishing the oil extraction tax from any other excise tax applied generally across the State. The Washington experience, with its proliferation of "special fund" projects between 1949 and 1963, is graphic evidence of what happens once the "foot is in the door." A dividing line must be drawn, and we believe it is more clearly drawn by prohibiting any tax from being the basis for a special fund, rather than by creating artificial distinctions based upon the "comprehensiveness" of the tax.[4]
The respondents also argue that the holding in Stark v. City of Jamestown, supra, is controlling and requires us to uphold the bonds. In Stark, the city planned to finance improvements and expansion of its municipal water plant and sewage system by issuing bonds to be paid from the revenues of the plant and system, including revenues from the existing system. We held that the bonds fell within the special-fund exemption to the municipal debt limitation, without requiring that revenues from the existing and new systems be segregated. The respondents contend that we thereby rejected a "restricted" special-fund doctrine, and that the case supports *700 their theory that funds from any source may be used to repay bonds.
We believe that the distinctions between Stark and this case are obvious. In Stark, we upheld bonds which were to be financed by revenues from an existing facility which was to be improved and expanded with the funds obtained; in this case, the State wishes to issue bonds payable from an oil extraction tax which is wholly unrelated to the project being funded. We do not believe that Stark is controlling over the instant case, nor is our holding today inconsistent with Stark.
The respondents argue that if this court rejects the application of the special-fund doctrine in this case, the legislation nevertheless can be sustained on the theory of a "continuing appropriation." In support of this contention, the respondents rely on this court's decisions in State v. Sorlie, 56 N.D. 650, 219 N.W. 105 (1928), and State v. Moses, 72 N.D. 142, 5 N.W.2d 303 (1942), and several decisions of courts in other jurisdictions. See McDonald v. Frohmiller, 63 Ariz. 479, 163 P.2d 671 (1945); In re Continuing Appropriations, 18 Colo. 192, 32 P. 272 (1893); Jeffreys v. Huston, 23 Idaho 372, 129 P. 1065 (1913); Fleckten v. Lamberton, 69 Minn. 187, 72 N.W. 65 (1897); Grossman v. State, Mont., 682 P.2d 1319 (1984); and Holmes v. Olcott, 96 Or. 33, 189 P. 202 (1920).
An analysis of these decisions reveals that the "continuing appropriations" approved in most of these cases differ significantly from the legislation at issue in this case. With the exception of Grossman, which is distinguishable on the basis of the particular State constitutional provisions involved, each appropriation in the other cases, although "continuing" in a sense, was nevertheless subject to repeal or modification by future legislative assemblies.[5] However, the "continuing appropriation" in this case cannot be repealed once the bonds are issued without threat of a breach of contract action by the bond holders until the bonds and interest are paid in full.
We agree with the rationale of the Colorado Supreme Court in In re Senate Resolution No. 2, Etc., 94 Colo. 101, 115-116, 31 P.2d 325, 331 (1933), in which the court addressed a similar assertion that the "continuing appropriation" theory could serve as an alternative basis to the special-fund doctrine for upholding the challenged legislation:
"It is said that this bill can be sustained on the theory of a `continuing appropriation' as upheld in In Re Continuing Appropriations, 18 Colo. 192, 32 P. 272. But an appropriation made by one General Assembly to pay for services or materials to be thereafter annually furnished, and which `continues' only because future General Assemblies do not, as well they might, discontinue both consideration and payment, and a `continuing appropriation' by a so-called `irrepealable act' to pay in installments, over a long period of years, for services or materials furnished in toto during the current year, are so different in all essential particulars as to have nothing in common save an arbitrary name. If the latter can be upheld under the cloak of continuing appropriations, this constitutional prohibition against contracting debts is construed out of existence, for under that cloak any debt may pass."
We conclude that the "continuing appropriation" theory cannot serve as a subterfuge for evading the State constitutional debt limitation.
In view of our disposition of this case, we deem it unnecessary to address the other arguments raised by the State Treasurer. "Questions, the answers to which are not necessary to determination of the case, need not be considered." Hospital Services v. Brooks, 229 N.W.2d 69, 71 (N.D.1975).
For the reasons stated in this opinion, the injunction sought by the State Treasurer prohibiting the issuance of bonds to finance the Southwest Pipeline is granted and the writ of mandamus sought by the *701 respondents ordering the State Treasurer to execute the agreement is denied.
ERICKSTAD, C.J., and PEDERSON, GIERKE and SAND, JJ., concur.
NOTES
[1] The State Treasurer did request the Attorney General to bring the action but the Attorney General refused. Ordinarily, the consent or refusal of the Attorney General to institute the action should be secured in initiating the exercise of original jurisdiction of this court for the reason that the Attorney General is the legal representative of the interests of the State, its sovereignty, franchises, and liberties of the people. See, e.g., State v. State Board of Canvassers, 44 N.D. 126, 172 N.W. 80 (1919). However, that consent or refusal is not necessary when the action is one in which the Attorney General is one of the parties defendant, and which concerns his alleged wrongful acts and seeks to restrain them. See, e.g., State v. Langer, 46 N.D. 462, 177 N.W. 408 (1919).
[2] Although we have cited with approval the Montana Supreme Court in its disposition of the jurisdictional issues in Grossman, we do not reach the same conclusion on the merits. Montana has different constitutional provisions than does North Dakota and thus the Grossman decision is of little value as precedent on the issue we consider controlling in this instance.
[3] Under the statutory scheme enacted by the 1983 Legislature, the bonds issued to finance the Southwest Pipeline would be paid from a special fund derived from the oil extraction tax. The oil extraction tax was created by an initiated measure of November 4, 1980, and is codified as Chapter 57-51.1, N.D.C.C. Section 57-51.1-02 provides that an excise tax shall be imposed upon the extraction of oil within the State at the rate of six and one-half percent of gross value at the well. Pursuant to Section 57-51.1-07(1), N.D.C.C., as amended in 1983, ten percent of the oil extraction tax is to be allocated to a sinking fund to pay the Southwest Pipeline bonds.
As adopted by the people of the State, the oil extraction tax was to be apportioned as follows: forty-five percent to the state school aid program; forty-five percent to the general fund; and the remaining ten percent to a trust fund, with the first $15,000,000 appropriated to the Grafton State School. After this initial appropriation to the Grafton State School, the principal of the trust fund was to be left to accumulate, with the interest thereon to be appropriated for development of energy conservation and renewable energy sources, development of co-generation systems, and development of waste products utilization. See 1981 N.D.Sess.Laws Ch. 649.
The 1981 Legislature extensively amended the provisions of the initiated measure. In particular, the Legislature changed the terms of the trust fund to allow use of principal and income of the fund for planning and construction of water supply facilities, and appropriated money for preliminary designs for the Southwest Pipeline. See 1981 N.D.Sess.Laws Ch. 613. The Legislature also amended the distribution of the remaining ninety percent of revenues, allocating sixty percent to the state school aid program and thirty percent to the general fund. The 1983 Legislature further amended the trust fund allocation, codified at 57-51.1-07, N.D.C.C., to provide that the funds be allocated to a sinking fund established for payment of the Southwest Pipeline bonds, with any excess credited to a trust fund to finance other water supply facilities and alternative energy sources. The Legislature again revamped distribution of the remaining revenues from the tax, allocating all ninety percent to the general fund. See Section 57-51.1-07, N.D.C.C.
[4] Although it is not controlling, and perhaps not even relevant to the issue before us, we note that in at least three instances in the past the electors approved an amendment to the North Dakota Constitution in order that bonds to pay adjusted compensation to veterans could be issued. See 1971 N.D.Sess.Laws Ch. 616 (Vietnam Conflict); 1957 N.D.Sess.Laws Ch. 396 (Korean Conflict); 1949 N.D.Sess.Laws, p. 510 (World War II).
[5] It is unclear whether or not the appropriation in Fleckten v. Lamberton, 69 Minn. 187, 72 N.W. 65 (1897), was subject to repeal or modification by ensuing legislatures. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2001467/ | 131 B.R. 359 (1991)
HAWORTH, INC., Plaintiff,
v.
SUNARHAUSERMAN LTD./SUNARHAUSERMAN LTEE, et al., Defendants.
Adv. No. 91-8454.
United States Bankruptcy Court, W.D. Michigan.
September 3, 1991.
*360 Devin S. Schindler, Warner, Norcross & Judd, Grand Rapids, Mich., for plaintiff.
Rock A. Wood, Dickinson, Wright, Moon, Van Dusen & Freeman, Grand Rapids, Mich., for defendant, Sunarhauserman Ltd./Sunarhauserman Ltee.
Deborah K. Urban, Akron, Ohio, for defendant, Ernst & Young.
Alan R. Lepene, Mary C. Kaczmarek, Thompson, Hine & Flory, Cleveland, Ohio, for defendants, Soc. Nat. Bank, Ameritrust Co. Nat. Ass'n and NBD Bank, N.A.
OPINION
LAURENCE E. HOWARD, Bankruptcy Judge.
Currently before the Court are three interrelated motions. First, there is a motion to dismiss or, alternatively, to transfer or stay this action filed by the Defendants. Next, there is a motion filed by the Plaintiff, Haworth, Inc. (or "Haworth"), for mandatory abstention or remand. Finally, Ernst & Young, Inc. has filed a motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). All of these proceedings arise from a complicated factual setting and were removed to this Court by the Defendants pursuant to 28 U.S.C. § 1452.
For the reasons set forth in this opinion, the Defendants' motion for transfer is granted and this proceeding will now be sent to the United States Bankruptcy Court for the Northern District of Ohio, Eastern Division. The Plaintiff's motion for mandatory abstention or removal is denied. Due to the fact that it is proper to transfer this proceeding, final judgment is not rendered on the other issues raised.
FACTS
The Plaintiff, Haworth, Inc., originally filed its cause of action in the Circuit Court for the County of Kent, Michigan, on April 26, 1991. The action was filed against Sunarhauserman Ltd./Sunarhauserman Ltee (hereinafter known as "Sunar"); Ernst & Young, Inc., as trustee of the bankruptcy estate of Sunar; and Society National Bank, Ameritrust Company, N.A. and NBD Bank, N.A. (collectively known as "the Banks"). Sunar is a Canadian corporation engaged in the manufacture and sale of office furniture. Sunar is presently in bankruptcy in Canada. Sunar was formed as a wholly owned subsidiary of SunarHauserman Inc., which is an Ohio Corporation and a wholly owned subsidiary of Hauserman, Inc., also an Ohio corporation. The Ohio Corporations are referred to by the parties as "Hauserman". On October 5, 1989, Hauserman filed for Chapter 11 relief in the United States Bankruptcy Court for the Northern District of Ohio, Eastern Division.
These complicated disputes arise out of the purchase, by Haworth, of the "RACE" line of office furniture from both Sunar and Hauserman. The sale was embodied in two agreements that the parties admit are virtually identical. The contract to purchase the assets from Hauserman is referred to as the "American Agreement", while the contract with Sunar is known as the "Canadian Agreement." The purchase agreements were negotiated after the parent corporation, Hauserman, filed its Chapter 11 in Ohio.
*361 Hauserman filed an adversary proceeding against Haworth in the Ohio Bankruptcy Court on February 28, 1991. In the Ohio action, Hauserman alleges that Haworth failed to pay the Banks $1,000,000.00 as called for by the American purchase agreement. Haworth has filed defenses in the Ohio adversary proceeding based upon the American Agreement.
In the action before me in this Court, Haworth seeks the remedies of offset and indemnification, claiming that Sunar breached its promise to transfer full rights, free of infringement, to the RACE line. The action by Haworth is based solely on the Canadian Agreement and lists only the Canadian parties and the Banks as Defendants.[1]
The reasons given in support of each party's action appear to be the opposing sides of a single dispute where each is alleging that the other was first to breach. In the adversary proceeding before me in Michigan, Haworth asserts that Sunar failed to comply with its obligations in the transfer of the RACE line. The action is maintained against Sunar for breach of contract, breach of warranty and fraud and misrepresentation and is maintained against the Banks for indemnification. In the adversary proceeding before the Ohio Bankruptcy Court, Hauserman alleges that Haworth breached its payment obligation. Hauserman claims that Haworth was not justified in suspending payment, while Haworth asserts that the aforementioned breach of contract motivated its actions.
With Sunar in bankruptcy in Canada, and Hauserman in bankruptcy in Ohio, the question of how this matter came before me should be addressed. The action filed by Haworth in Kent County Circuit Court was removed to this Court by the Defendants pursuant to 28 U.S.C. § 1452(a). The Defendants now seek dismissal, stay or transfer of the action. In response, Haworth asks for remand to the state court or abstention. The Canadian Trustee seeks to have proceedings against him dismissed.
I will deal with all the motions raised in this one opinion. At issue, is the decision of where Haworth's claims, based on the Canadian agreement and against the Canadian parties, should be adjudicated. What is difficult about this matter is determining the relationship between the Canadian subsidiary and its American parent and between the Canadian and American Agreement for the sale of the RACE line of furniture. Before me now are five possible courses of action in response to the motions filed. They are:
(1) Dismissing the Plaintiff's suit altogether;
(2) Allowing the Plaintiff's action to proceed in this forum, unhindered;
(3) Keeping the Plaintiff's action in this forum, but staying the proceeding until the completion of the Ohio Bankruptcy;
(4) Remanding to the state court or abstaining from deciding Haworth's suit pursuant to 28 U.S.C. § 1452(b) or § 1334; or, finally,
(5) Transferring the proceeding to the U.S. Bankruptcy Court for the Northern District of Ohio, Eastern Division.
DISCUSSION
The first question to be considered is whether this adversary proceeding is properly before this court and whether we have any jurisdiction to decide the motions presented. The Defendants removed Haworth's action pursuant to 28 U.S.C. § 1452(a) which states that:
A party may remove any claim or cause of action . . . to the district court for the district where such civil action is pending, if such district court has jurisdiction of such claim or cause of action under section 1334 of this title.
As § 1452(a) sets forth, the court must have jurisdiction under § 1334 for removal to take place. If the adversary proceeding before me does not satisfy the jurisdictional grant of 28 U.S.C. § 1334, then the case must be sent back to the state court for want of jurisdiction and improper removal.
*362 § 1334(a) provides for original and exclusive jurisdiction for all cases "under title 11." § 1334(b) establishes original but not exclusive jurisdiction "for all civil proceedings arising under title 11, or arising in or related to cases under title 11." Sufficient jurisdiction exists in this Court, and removal was therefore properly achieved, if the proceeding before me is at least "related to" the Ohio Bankruptcy.
Haworth's suit is considered to be related to Hauserman's Chapter 11 case if the outcome of the proceeding could conceivably have any effect upon the estate being administered in bankruptcy. In re Salem Mortgage Company, 783 F.2d 626, 634 (6th Cir.1986) (quoting Mazur v. U.S. Air Duct Corp., 8 B.R. 848, 851 (Bankr. N.D.N.Y.1981)).
Even with this liberal definition supplied by the Sixth Circuit, the determination of whether removal was properly accomplished and whether the jurisdictional grant of § 1334(b) was minimally satisfied is not an easy one. Consideration must be given to the fact that the proceeding before the Court is only against the Canadian subsidiary and is based solely on the Canadian agreement. Removal is not proper unless Haworth's proceeding, which is against a separate corporation and based on a separate contract, could conceivably affect the Ohio Bankruptcy.
Here, although difficult to decide, I find that the jurisdictional test of Salem Mortgage has been met. The sale of the RACE asset line was essentially accomplished in one transaction. Both parties agree that the contracts are mirror images of each other. Also, with the Canadian Corporation being the subsidiary of the Ohio parent, a conceivable relationship has been established.
Additionally, the parties seem to concede that at least "related to" jurisdiction is present in this case. In its supporting brief, Haworth, as part of its argument, states that this adversary proceeding is of "related to" status. (See Plaintiff's Brief in Support of Its Motion for Mandatory Abstention and Remand Pursuant to § 1334(c)(2) at 6).
Having established at least related to jurisdiction for this adversary proceeding, removal was properly achieved by the Defendants under § 1452(a). With this decided, attention can now be given to the motions raised by the parties.
The Defendants seek an order dismissing the proceeding initiated by Haworth or, alternatively, the transfer of the case to the Northern District of Ohio where the parent corporation's bankruptcy is proceeding. I find that their motion for transfer should be granted and, in the interest of justice, this adversary proceeding should be sent to the Bankruptcy Court for the Northern District of Ohio, Eastern Division.
28 U.S.C. § 1412, which is incorporated by Bankruptcy Rule 7087, provides that a "District Court may transfer a case or proceeding under title 11 to a district court for another district, in the interest of justice or for the convenience of the parties."
Six factors are usually considered in the determination of whether transfer to another district is "in the interest of justice and for the convenience of the parties." They are:
1. The proximity of creditors of every kind to the Court;
2. The proximity of the debtor to the Court;
3. The proximity of the witnesses necessary to the administration of the estate;
4. The location of the assets;
5. The economic administration of the estate; and
6. The necessity for ancillary administration if bankruptcy should result.
In re Commonwealth Oil Refining Co., Inc., 596 F.2d 1239, 1247 (5th Cir.1979).
The most important factor to be considered is whether the transfer would promote the economic and efficient administration of the estate. In re Commonwealth Oil Refining Company, Inc., 596 F.2d at 1247.
Here, the parent company, Hauserman, is in Ohio. In fact, all parties involved in the dispute, including the Plaintiff, are already *363 before the Bankruptcy Court for the Northern District of Ohio. Efficiency is served by having this matter transferred to the forum where all the parties are present and before the Court.
Another persuasive reason for transfer is the fact that the Bankruptcy Court for the Northern District of Ohio has already begun to hear the adversary proceeding before it and has already made rulings with respect to the case. It would be a waste of judicial energy for me to begin to hear the same issues. As noted, the fact situations out of which each adversary proceeding arose are identical. The proceeding in Ohio and the one before me now are two sides of the same coin. There would be a bifurcation of the dispute for me to hear the Canadian part while the Bankruptcy Court in Ohio heard the American.
Lastly, justice strongly favors transferring this case to the forum wherein the debtor is located. This case is complicated because there is no debtor involved in the case that is in bankruptcy in this district. Sunar is in bankruptcy in Canada, while Hauserman has filed in the Northern District of Ohio. But, as the proceeding before me is related to Hauserman's bankruptcy in Ohio, and due to the fact that all the parties are before that forum and are going ahead with an action substantially similar to the one before me now, I find that justice dictates that this adversary proceeding be transferred to the court in Ohio. Transferring this proceeding will place all the disputes arising out of the sale of the RACE line of furniture before the Court which is hearing the parent corporation's bankruptcy and which originally was involved in and had approved the sale of the RACE line.
Ernst & Young and the Banks, have argued that this matter should be dismissed. I find, however, that once deciding to transfer this case, the question of whether to dismiss need not be decided. The Trustee's objection to jurisdiction and the compulsory counterclaim issue need not be dealt with in this forum. By transferring the case, all matters involving the sale of the RACE line of furniture will be placed before the Bankruptcy Court for the Northern District of Ohio. As the adversary proceeding in Ohio has already been deemed to be a core proceeding, endowing the court in Ohio with complete dispositive power, it would be appropriate to transfer this matter to the Northern District of Ohio.
The Plaintiff contends that transfer under 28 U.S.C. § 1412 is improper because the Banks, the Trustee and Sunar have already consented to venue and jurisdiction in Michigan. However, the consent to jurisdiction and venue in the Canadian agreement was nonexclusive. Since the Marathon[2] decision, Bankruptcy Courts have become acutely aware of the limits of their dispositive power. It is clear to me that the Bankruptcy Court for the Western District of Michigan is not the proper Court to hear this proceeding. The Plaintiff has argued that the matter should be sent back to the state court. However, since this case is related to the one in Ohio and since all parties are already before the Ohio Court arguing, essentially, the same issues, it is more in the interest of justice to see this matter litigated before the Ohio Bankruptcy Court.
Under Section 1412, the movant has the burden to establish that transfer was in the interest of justice. The Defendants have met this burden. It is therefore held that this adversary proceeding be transferred to the Bankruptcy Court for Northern District of Ohio, Eastern Division. I find that transfer does not merely shift the inconvenience of proceeding from one party to another, but is in the interest of justice and places the matter before the proper forum.
Next, we must consider the Plaintiff's motion for mandatory abstention or remand. Remand is proper under 28 U.S.C. § 1452(b) when equitable grounds exist. As already noted, equity favors this *364 proceeding being litigated in Ohio. The Ohio Bankruptcy Court is prepared to handle the issues raised by the dispute and jurisdiction exists there over all the necessary parties. A detrimental bifurcation of the issues will be spared by having the matter heard before the Ohio Bankruptcy Court.
Mandatory abstention is provided for under 28 U.S.C. § 1334(c)(2). Relying on my decision in D.C. Equipment, I find that, although this matter is only related to a case under title 11, mandatory abstention is nonetheless improper as the state court proceeding was filed after the bankruptcy in Ohio to which this adversary proceeding is related. In re D.C. Equipment Co., Inc., No. HM 86-00049, 1990 WL 102237, 1990 Bankr. LEXIS 569 (Bankr.W.D.Mich. 1990). There being no basis for either mandatory abstention or remand, the motion of the Plaintiff is denied.
CONCLUSION
Pursuant to 28 U.S.C. § 1412, I now grant the Defendants' motion to transfer this adversary proceeding to the Bankruptcy Court for the Northern District of Ohio. Accordingly, Plaintiff's motion is denied. Judgment is not rendered on all other issues raised.
NOTES
[1] The Banks are involved in this litigation since under both the American and Canadian Agreements they are being compensated for security interests possessed in the RACE line.
[2] Northern Pipeline Construction Co., v. Marathon Pipe Line Co., 458 U.S. 50, 102 S.Ct. 2858, 73 L.Ed.2d 598 (1982). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603834/ | 354 N.W.2d 656 (1984)
Peter A. QUIST, Securities Commissioner of the State of North Dakota, Appellee,
v.
BEST WESTERN INTERNATIONAL, INC., an Arizona nonprofit corporation, Appellant.
Civ. No. 10571.
Supreme Court of North Dakota.
July 18, 1984.
*658 Kermit Edward Bye (argued), of Vogel, Brantner, Kelly, Knutson, Weir & Bye, Fargo; and Jerry C. Bonnett, Phoenix, Ariz., of counsel, of Evans, Kitchel & Jenckes, Phoenix, Ariz., for appellant.
Peter A. Quist, Securities Commissioner, State Capitol, Bismarck, for appellee.
GIERKE, Justice.
This is an appeal from a judgment of the District Court of Burleigh County affirming an order of the North Dakota Securities Commissioner, which required the appellant, Best Western International, Inc., an Arizona corporation, to refrain and desist from the further offer or sale of membership agreements in North Dakota until the offer or sale of these agreements has been registered with the Securities Commissioner, pursuant to the North Dakota Franchise Investment Law, Chapter 51-19, N.D.C.C.
This action was begun by way of a declaratory judgment action commenced by Best Western to determine its status under the North Dakota Franchise Investment Law (FIL). The district court in which the action was filed concluded that a determination of Best Western's status was a matter to be pursued through the administrative processes available to the Commissioner. The Commissioner then commenced his own action seeking an order requiring that Best Western register its offers of membership agreements in compliance with the requirements of the FIL. Best Western's answer alleges that the FIL was inapplicable, or, alternatively, that Best Western was exempt from its provisions. Best Western further alleges that if its activities were within the contemplation of the FIL and not exempt, the law itself was unconstitutional as violative of Article I, §§ 21 and 22 of the North Dakota Constitution, and the Commerce, Due Process, and Equal Protection Clauses of the United States Constitution. Best Western also alleges that the broad authority delegated to the Commissioner by the FIL rendered it facially unconstitutional.
On June 24, 1982, a hearing was conducted before Mr. Douglas L. Johnson, hearing officer, pursuant to § 28-32-05, N.D.C.C. The hearing officer issued his proposed findings of fact, conclusions of law, and order on March 2, 1983. The hearing officer concluded that the agreements between Best Western and its members were "franchises" as defined in § 51-19-02(5), N.D. C.C.; that Best Western had offered or sold franchises in North Dakota in violation of the registration provisions of § 51-19-03, N.D.C.C.; that Best Western did not qualify for the statutory exemptions from registration; that Best Western had not been exempted by rule from registration; and that the Commissioner had not applied the FIL in a discriminatory manner. The Securities Commissioner, by his order dated March 3, 1983, adopted the proposed findings of fact and conclusions of law, and ordered Best Western to refrain and desist from offering memberships in its organization until the offers are registered with the Securities Commissioner, pursuant to the provisions of the FIL.
Best Western then appealed from the Commissioner's order to the District Court of Burleigh County, pursuant to § 28-32-15, N.D.C.C. The district court affirmed the Commissioner's order and judgment was entered accordingly. From that judgment, Best Western appeals.
Best Western raises three issues on appeal:
*659 1. Does Best Western's operation constitute a franchise as contemplated by the North Dakota Franchise Investment Law?
2. Does the application of the registration provisions of the Franchise Investment Law violate Best Western's rights under Article 1, §§ 21 and 22 of the North Dakota Constitution and the Commerce, Due Process, and Equal Protection Clauses of the United States Constitution?
3. Is the Franchise Investment Law facially unconstitutional because it delegates broad discretionary authority to the Commissioner without establishing proper standards or guides for the exercise of that discretion?
We will discuss these issues in the order listed above.
I
The material facts of this case are not in dispute. Evidence regarding the structure and operation of the Best Western organization was presented by Best Western itself and it was on that evidence that the Commissioner based his determination.[1] Best Western nevertheless asserts that the Legislature did not intend that cooperative associations, such as Best Western, should be subject to registration under the FIL.
It is Best Western's position that the statutory definition of "franchise" is ambiguous, and that, when properly interpreted in light of its legislative history and underlying policy, the term "franchise" does not include cooperative marketing associations. This argument is outlined in Best Western's brief as follows:
"The definition of `franchise' is manifestly circular. Under the first element of the test, a marketing plan or system must be prescribed in substantial part by a franchisor. A `franchisor', on the other hand, is `a person who grants a franchise'. § 51-19-02(8). Neither the term `franchise' nor the term `franchisor' has a self-evident meaning; one cannot be fully and unequivocally defined merely by referring to the other. Hence, some analysis of the legislative intent must be undertaken to arrive at what the Legislature meant by `franchisor'.
The statutory definition of "franchise" is found in § 51-19-02(5)(a), N.D.C.C., as follows:
"5.a. `Franchise' means a contract or agreement, either expressed or implied, whether oral or written, between two or more persons by which:
"(1) A franchisee is granted the right to engage in the business of offering, selling, or distributing goods or services under a marketing plan or system prescribed in substantial part by a franchisor;
"(2) The operation of the franchisee's business pursuant to such plan or system is substantially associated with the franchisor's trademark, service mark, trade name, logotype, advertising, or other commercial symbol designating the franchisor or its affiliate; and
"(3) The franchisee is required to pay, directly or indirectly, a franchise fee."
A "franchise fee" is defined in § 51-19-02(6), N.D.C.C., as:
"... any fee or charge that a franchisee or subfranchisor is required to pay or agrees to pay for the right to enter into a business under a franchise agreement, including, but not limited to, any such payment for such goods or services...."
In construing the above statute we are guided by §§ 1-02-02, 1-02-03, and 1-02-05, N.D.C.C., which provide:
"1-02-02. Words to be understood in their ordinary sense.Words used in any statute are to be understood in their ordinary sense, unless a contrary intention plainly appears, but any words explained in this code are to be understood as thus explained.
"1-02-03. LanguageHow construed. Words and phrases shall be construed according to the context and *660 the rules of grammar and the approved usage of the language. Technical words and phrases and such others as have acquired a peculiar and appropriate meaning in law, or as are defined by statute, shall be construed according to such peculiar and appropriate meaning or definition.
"1-02-05. Construction of unambiguous statute.When the wording of a statute is clear and free of all ambiguity, the letter of it is not to be disregarded under the pretext of pursuing its spirit."
The primary purpose of statutory construction is to ascertain the intent of the Legislature, McCroskey v. Cass County, 303 N.W.2d 330 (N.D.1981), and that intent must first be sought in the language of the statute. State v. Nordquist, 309 N.W.2d 109 (N.D.1981); McCroskey v. Cass County, supra. Furthermore, a statute must be viewed as a whole, with a view at arriving at the Legislature's intent. Horst v. Guy, 219 N.W.2d 153 (N.D.1974). Legislative intent is presumed to be clear from the face of the statute. Morton County v. Henke, 308 N.W.2d 372 (N.D.1981); Barnes County Ed. Ass'n v. Barnes County Special Ed. Bd., 276 N.W.2d 247 (N.D.1979). Resort may be had to extrinsic aids in the event that the statutory language is ambiguous. Morton County v. Henke, supra.
Applying the rules of statutory construction set forth above, we cannot agree with Best Western's contention that the statutory definition of "franchise" is ambiguous. Under the plain meaning of the statute, a "franchise" is simply a contract or agreement between two parties by which one party grants and the other party receives certain statutorily delineated rights and obligations. In return, the grantor, or "franchisor", receives a "franchise fee". The statute contains no exception for cooperative marketing agreements.
Furthermore, it is apparent that the statutory definition of "franchise", when viewed within the context of Chapter 51-19, N.D.C.C., the Franchise Investment Law, as a whole, was intended to be a broad definition. The variety of business organizations and their purposes preclude a precise definition of the term. Instead, the Legislature has broadly defined "franchise" and provided certain exemptions from the definition. Of particular importance in the statutory scheme is the exemption found at § 51-19-04(3), N.D.C.C.:
"3. There shall be exempted from the provisions of section 51-19-03 any other transaction which the commissioner by rule exempts as not being comprehended within the purposes of the chapter and the registration of which he finds is not necessary or appropriate in the public interest or for the protection of investors."
By this method, the Legislature broadly defined the area of regulation and authorized the Commissioner to determine on a case-by-case basis whether or not the protection of the public requires registration of a particular business arrangement. The administration of the FIL is an area where there is an obvious need for agency expertise. The statutory scheme provided in the FIL is common to such situations where the Legislature cannot be expected to provide for regulation of the public interest on a case-by-case basis. In this case, the Commissioner has refused to exempt Best Western from the statutory definition.
Section 51-19-16(8), N.D.C.C., provides that:
"8. Every final order, decision, license, or other official act of the commissioner is subject to judicial review in accordance with chapter 28-32."
Chapter 28-32, N.D.C.C., is the "Administrative Agencies Practice Act". Section 28-32-19 provides for appeal to the district court from the determination of an administrative agency. The section further provides, in pertinent part, that:
"... the court shall affirm the decision of the agency unless it shall find that any of the following are present;
"1. The decision or determination is not in accordance with the law.
*661 "2. The decision is in violation of the constitutional rights of the appellant.
"3. Provisions of this chapter have not been complied with in the proceedings before the agency.
"4. The rules or procedure of the agency have not afforded the appellant a fair hearing.
"5. The findings of fact made by the agency are not supported by a preponderance of the evidence.
"6. The conclusions and decision of the agency are not supported by its findings of fact...."
Section 28-32-21, N.D.C.C., provides for supreme court review of the judgment of the district court in an appeal from a decision of an administrative agency. Our scope of review is identical to that of the district court. Our review is limited to the evidence contained in the record of the administrative hearing. Barnes County v. Garrison Diversion Conservancy District, 312 N.W.2d 20 (N.D.1981); North Dakota Real Estate Commission v. Allen, 271 N.W.2d 593 (N.D.1978).
Applying these rules to the present case, we conclude that the Commissioner's conclusions of law are supported by the findings of fact; and that the Commissioner's final determination is in accordance with the law. Best Western has not complained that the Commissioner's findings of fact are not supported by a preponderance of the evidence; that the provisions of the Administrative Agencies Practice Act have not been complied with; or that the Commissioner's rules and procedures have not afforded Best Western a fair hearing. We therefore proceed to the constitutional issues raised by Best Western.
II
In the administrative hearing and on appeal to the district court, Best Western alleged that the FIL unconstitutionally discriminated against retailer-owned marketing cooperatives such as Best Western and further alleged that the delegation of authority to the Commissioner was without intelligible guidelines and is therefore an unconstitutional delegation of legislative power.
Before proceeding to these issues we must first address an issue raised by the Commissioner: that is, whether or not Best Western has waived the right to challenge the constitutionality of the FIL by virtue of its own conduct. Discussion of this issue requires some background concerning the events leading to this appeal.
In 1980, David S. Maring, a Fargo attorney, inquired of the Securities Commissioner's office if Best Western was registered to offer and sell franchises in North Dakota. Colleen Schweigert, the franchise examiner at that time, sent a standard form inquiry-complaint letter to Best Western on March 14, 1980. Enclosed in that letter was a list of items which Best Western was asked to provide.
On March 24, 1980, Harold J. Bliss, Jr., an Arizona attorney, wrote to Ms. Schweigert and indicated that he would be responding to her letter of March 14, 1980, on behalf of Best Western. Mr. Bliss then submitted Best Western's response by letter dated April 17, 1980. The portion of that letter pertinent to the issue under consideration states as follows:
"... If it is your opinion, based upon review of the enclosed, that Best Western's business is a franchise under the North Dakota law, we request that an exemption or no-action letter be issued under Section 51-19-04.3, North Dakota Century Code...."
Approximately one month later, Ms. Schweigert wrote to Mr. Bliss and informed him of the conclusions which had been reached following a review of the material submitted on behalf of Best Western. She also stated that:
"With reference to your request that an exemption be issued under Section 51-19-04(3), N.D.C.C., this office is extremely reluctant to open this heretofore closed door without very serious consideration of all aspects of a plan of business, *662 with special emphasis on what measures are taken to protect the investment of potential franchisees. Therefore, we hereby extend to Best Western International, Inc., the opportunity to justify the creation of an exemption by rule for the franchise it offers."
On June 26, 1980, Mr. Bliss advised Ms. Schweigert that he had been informed by Best Western that it desired to pursue an exemption by rule. Mr. Bliss requested advice on the information needed to determine whether the exemption should issue.
Ms. Schweigert's response, in a letter dated August 28, 1980, informed Mr. Bliss that the Commissioner's office was
"... very reluctant to exempt by rule any transactions which would otherwise be subject to the registration provisions of the franchise law, thus opening a door of escape to companies whose methods of business require regulation. It is our very strong inclination to require Best Western International to register immediately...."
Ms. Schweigert added, however, that the office would take no action until Best Western had had an opportunity to respond.
Best Western then submitted to the Commissioner's office a formal request for an exemption ruling, pursuant to § 51-19-04(3), N.D.C.C.
The Commissioner's office responded to the formal request for exemption by letter of January 21, 1981, in which the Commissioner indicated that his office would be willing to initiate a rule-making procedure on the condition that Best Western make rescission offers to all North Dakota members who had bought memberships after July 1, 1975, the date the franchise law became effective. By letter of February 4, 1981, Jerry C. Bonnett, who had replaced Mr. Bliss as Best Western's counsel, informed the Commissioner's office that Best Western had begun evaluating the suggestions contained in the Commissioner's response to Best Western's formal request for exemption.
Shortly thereafter, Best Western, rather than tendering rescission offers to its North Dakota members, requested of the Commissioner an interpretive opinion or "no-action" determination, pursuant to § 51-19-16(5), N.D.C.C., regarding the applicability of the North Dakota Franchise Investment Law to Best Western. The Securities Commissioner at that time was Mr. Arly Richau. By letter dated April 3, 1981, Mr. Richau informed Mr. Bonnett that although he felt that Best Western's arguments were meritorious, it would be inappropriate for him to render such an opinion during the pendency of a lawsuit involving Best Western and one of its former North Dakota members.
In 1981, Mr. Richau was succeeded as Securities Commissioner by Mr. Dale V. Sandstrom. Mr. Sandstrom took the position that he would not promulgate a rule to exempt Best Western from registration under the Franchise Investment Law. In his letter of June 22, 1981, to Mr. Bonnett, Commissioner Sandstrom stated his reasons for this refusal:
"I decline to promulgate a rule to exempt Best Western from registration under the Franchise Investment Law. I do not believe such promulgation would be in the public interest. I do not believe it would be in the public interest to exempt Best Western from the disclosure and other requirements of the Franchise Investment Law.
"Best Western is clearly a franchise. It clearly comes nowhere near the $10,000,000 net worth exemption (an amount worth far less today than the value of $10,000,000 when the legislature set the figure).
"I have read with interest your contention that the legislature intended to exempt all cooperatives. I believe the comment that `No cooperatives are franchised,' in the context made at the legislative committee session, was intended and understood to be the standard North Dakota legislative halls [sic ] reference to agricultural cooperatives, and simply notes the fact that they do not operate as franchises (emphasis in original).
*663 "I also note your comment that `A statute's "spirit and purpose should prevail over its strict letter."` While I believe that requiring registration of Best Western is consistent with the spirit and purpose of the law, I would note that North Dakota Century Code Section 1-02-05 provides:
"`CONSTRUCTION OF UNAMBIGUOUS STATUTE.When the wording of a statute is clear and free of all ambiguity, the letter of it is not to be disregarded under the pretext of pursuing its spirit.'
"I also note that other entities you mention, such as Holiday Inn, which are exempted from North Dakota registration because of the $10 million net worth provision, are required to make disclosures to potential investors by Federal Trade Commission requirements. On the other hand, Best Western, in the absence of state requirement, would not be required to make such disclosure.
"I find nothing in the organization form of a nonprofit, retailer-owned cooperative that guarantees freedom from franchisee victimization.
"For these reasons, jointly and severally, I decline to exercise my rule-making power in this regard."
It is the position of the present Commissioner, Mr. Peter A. Quist, that Best Western waived its right to challenge the constitutionality of the FIL when it attempted to seek "benefits" under the statute, through its formal request for exemption and its request for a "no-action" letter. In short, the Commissioner contends that Best Western should not be allowed to question the constitutionality of the authority delegated to him by the Legislature after petitioning him to exercise that very authority.
Best Western's response to the Commissioner's contention is that:
First, Best Western's conduct does not support an inference of clear, voluntary abandonment of constitutional rights;
Second, Best Western neither sought nor received any benefit or advantage conferred by the FIL;
Third, the waiver rule urged by the Commissioner is not a rule at all, but is honored mainly in the breach; and Fourth, all efforts by Best Western to convince the Commissioner that he should not enforce the FIL against Best Western were compelled by the threat of administrative or judicial penalty.
The law in North Dakota regarding waiver of the right to assert the unconstitutionality of a statute is clear. The Commissioner places his principal reliance upon City of Fargo v. Annexation Review Commission, 123 N.W.2d 281 (N.D.1963). In that case the City of Fargo attempted to annex adjacent properties. The governing body of the city adopted a resolution including these properties within the city limits. Various owners of the annexed property appealed to the Annexation Review Commission from the action of the City. After a hearing, the Review Commission decided that the greater portion of the annexed properties could not be annexed. The City then applied to the district court for a writ of certiorari. The district court entered judgment adverse to the City and the City appealed to this court. One of the City's contentions was that the statute providing for a hearing and decision by the Annexation Review Commission was unconstitutional as an unlawful delegation of judicial power. In holding that the City had waived its right to assert the constitutional question, we stated in City of Fargo v. Annexation Review Commission, supra 123 N.W.2d at 285, that:
"At no time did the City question the authority of the review commission to hear and determine the question of the use which was being made of the land in question, which land the City is attempting to annex. Had the review commission determined this question of use in favor of the City, no question of the authority of the commission would have been raised by the City. After the commission rendered an adverse decision, the City cannot, for the first time, question the constitutionality of the Act under which the commission was acting. In *664 other words, a party who has submitted to the jurisdiction of the commission, seeking to obtain a decision in his own favor, cannot, after an adverse decision, question the right of the commission to render such decision on the ground that the Act authorizing the hearing before the commission is unconstitutional because of an alleged unlawful delegation of judicial authority. This court has repeatedly held that a party who seeks to enjoy benefits under a law cannot thereafter, in the same proceeding, question the constitutionality of the Act."
In Benson v. North Dakota Workmen's Comp. Bureau, 250 N.W.2d 249 (N.D. 1977), we held that an employee who filed a claim with the Workmen's Compensation Bureau and thus submitted to its jurisdiction could not question the constitutionality of the agricultural exclusion from the Compensation Act for the first time on appeal to the district court. We also stated, in Benson, supra 250 N.W.2d at 250, that:
"It is questionable whether one who seeks to enjoy the benefits under a law can thereafter, in the same proceeding, question the constitutionality of the Act under which he proceeds. City of Fargo v. Annexation Review Commission, 123 N.W.2d 181 (N.D.1963)."
In Newman Signs, Inc. v. Hjelle, 268 N.W.2d 741 (N.D.1978), appeal dismissed 440 U.S. 901, 99 S. Ct. 1205, 59 L. Ed. 2d 449 (1979), a challenge was brought to the constitutionality of the North Dakota Highway Beautification Act. In that case we held that the plaintiff was estopped from attacking the constitutionality of the rule and regulation of the Highway Commissioner. We also stated, in Newman, supra 268 N.W.2d at 750, that:
"... one who seeks and obtains the advantage of a statute is estopped from challenging the constitutionality of that statute. The rule goes back at least to 1893, where we said in Minneapolis, St. P. & S. Ste. M. Ry. Co. v. Nester, 3 N.D. 480, 483, 57 N.W. 510, 512 (1893):
"`He went before the commissioners, and sought the benefit of the law. Subsequently, he voluntarily chose to pursue a remedy provided by the statute in preference to a common-law remedy that was open to him. By these acts he has waived any benefit of the constitutional provision. Such should be the law in reason, and such is the law upon authority. Cooley, Const. Lim. 216; End.Interp.St. § 537, and cases there cited.'"
The plaintiff, in Frieh v. City of Edgeley, 317 N.W.2d 818 (N.D.1982), challenged the legality of a city ordinance under which the City sought bids for the collection of garbage within the City. The trial was held in the district court and the court determined that the defendant had fully participated in the bidding process conducted by the City and never raised any claim of irregularity or lack of authority on the part of the City and, in fact, registered no complaint until after the City had awarded the contract to the plaintiff's competitor. On appeal to this court we stated that we have "repeatedly held that a party seeking to enjoy the benefits under a law cannot thereafter, in the same proceedings, question the constitutionality of the act". We then held that the plaintiff had waived any right to object to the legality of the City's action, or the legality of the law under which the City acted, notwithstanding the fact that he had received no benefit.
As the foregoing cases attest, it is clear that in North Dakota one who seeks to enjoy the benefits under a law cannot, in the same proceedings, question the constitutionality of the act under which he proceeds. This is so even in the event that benefits are ultimately denied. In this case, Best Western petitioned the Commissioner to exercise the discretionary authority delegated to him by the Legislature in the FIL. Best Western actively sought a "benefit" through the exercise of the Commissioner's discretion. Because Best Western actively sought the exercise of the Commissioner's discretion, we conclude that Best Western has waived the right, in this proceeding, to question the constitutionality of the statute which is the source *665 of the Commissioner's discretionary authority.
The same does not hold true in regard to Best Western's remaining constitutional issue by which Best Western asserts that the enforcement of the FIL against Best Western is unconstitutionally discriminatory. Such a constitutional infirmity is not apparent from the face of the statute and arose only after the Commissioner, in the exercise of his discretion, determined that Best Western would not be exempted from the registration provisions of the FIL. Therefore, Best Western did not waive the right to question the constitutionality of the application of the registration provisions of the FIL against Best Western.
III
Best Western contends that the North Dakota Legislature did not intend that the FIL regulate agricultural marketing cooperatives and that there is no rational basis for distinguishing between agricultural cooperatives and retailer-owned marketing cooperatives such as Best Western. Best Western also asserts that even if the Legislature did not intend to draw such a distinction, it is the policy of the Commissioner not to apply the FIL to agricultural cooperatives. In challenging the constitutionality of that distinction, Best Western must bear the burden of establishing that this classification bears no reasonable relation to a conceivable legislative purpose. Newman Signs, Inc. v. Hjelle, supra 268 N.W.2d at 758. As noted earlier in this opinion, our review is limited to the evidence contained in the record of the administrative hearing.
To begin, as we have already noted, the Franchise Investment Law does not exempt marketing cooperatives in general, or, more particularly, agricultural cooperatives, from its registration provisions. Second, it is the Commissioner's position, as stated in his brief "that cooperatives, whether categorized as marketing, agricultural, or otherwise, are not exempt from the FIL if they come within the definitional provisions thereof". The record reveals no evidence to establish that the Commissioner's actions are contrary to this policy. Third, even if a separate classification for agricultural cooperatives were to be delineated, either by the statute or by exemption by rule, the record fails to establish that such a classification would bear no reasonable relation to a conceivable legislative purpose.
In sum, the record is simply insufficient to establish discriminatory intent on the part of the Legislature or the Commissioner and equally insufficient to establish discriminatory effect. Neither the statute nor the Commissioner, by rule, has carved out any exemption for cooperatives, agricultural or otherwise.
Closely related to the issue discussed above, is Best Western's contention that the Commissioner has selectively enforced the FIL. It is conceded by the Commissioner that his office has not attempted to force any marketing cooperative, except Best Western, to register under the FIL. It is also apparent, however, that a number of marketing cooperatives have voluntarily chosen to register. The mere fact that the Best Western is the only cooperative association which has been "forced" to register is not sufficient to establish discriminatory enforcement by the Commissioner's office. At the administrative hearing, the franchise examiner testified that not only had a number of cooperative associations registered with the Commissioner's office, but she was unaware of any which had not registered, with the exception of Best Western. Furthermore, the record does not reveal whether any cooperative associations which fall within the definitional provisions of the FIL have not registered. The evidence contained in the record on appeal is simply insufficient to sustain Best Western's contention.
For the reasons expressed in this opinion, the judgment is affirmed.
ERICKSTAD, C.J., and PEDERSON, VANDE WALLE, and SAND, JJ., concur.
NOTES
[1] On this appeal, Best Western has raised no objection to the proposed findings of fact submitted by the hearing officer and adopted by the Commissioner. The findings of fact are, therefore, not set forth herein. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603859/ | 354 N.W.2d 25 (1984)
Robert J. LUNDGREN, D.C., as trustee for the heirs and next of kin of Ruth Carol Lundgren, decedent, Appellant,
v.
Rick FULTZ, Defendant,
David W. Cline, individually and as a member of the Department of Psychiatry of the University of Minnesota Hospitals, Respondent.
No. C1-82-1517.
Supreme Court of Minnesota.
September 7, 1984.
*26 Warren P. Eustis and Cynthia K. Nyman, Minneapolis, for appellant.
John Richard Bland, Minneapolis, for respondent.
Considered and decided by the court en banc without oral argument.
YETKA, Justice.
This case arises upon review of a summary judgment granted in favor of defendant, a University of Minnesota psychiatrist, on the ground that plaintiff failed to state a cause of action. The trial court held that the psychiatrist was under no legal duty to warn the public of the potential danger posed by his patient, nor was he under any duty to rehospitalize the patient upon learning the patient had stopped taking his medication. The trial court did not address plaintiff's allegation that the psychiatrist negligently recommended to the University police that they return several handguns to the patient, one of which the patient later used in the senseless murder of plaintiff's decedent. We reverse and remand for a jury trial on the ground that the unaddressed element of plaintiff's complaint states a cause of action.
Viewing the troubling facts of this case in the light most favorable to the plaintiff, they are as follows: In October of 1968, police brought Rick Fultz, a graduate student in theoretical physics at the University of Minnesota, to the University of Minnesota Hospitals. Fultz had been arrested after brandishing a revolver in a Minneapolis restaurant. The Hennepin County District Court ordered Fultz admitted to the psychiatric section of the University Hospitals. Upon admission, Fultz was extremely agitated and had delusions of omnipotence. His thought content was violent and paranoid, and he spoke of killing or being killed. Fultz, at this time, came under the care of defendant Dr. David Cline, a psychiatrist with the Department of Psychiatry at the University.
It seems clear that, during this first hospitalization, Rick Fultz was a seriously disturbed individual. Fultz talked repeatedly of killing people. At one point, he vented his hostility by striking a doctor with a pool cue. The patient later brought the pool cue to a test session, stating that it took the place of a gun. Fultz told one doctor that his guns meant more to him than his penis, and Dr. Cline thought his "defensive pattern of interest" characteristic of introspective males who have great concern about their masculinity.
Dr. Cline diagnosed Fultz as a paranoid schizophrenic. Fultz was discharged from the hospital about January of 1969, after exhibiting an apparent remission in delusional thinking. The discharge statement noted, however, that the patient continued to exhibit considerable inner tension and required follow-up care.
Sometime in late 1969 or early 1970, Fultz purchased at least five handguns. He was voluntarily re-admitted to the hospital on April 20, 1970, after he was observed brandishing a pistol at a campus demonstration. At this point, he was very nervous and afraid of hurting people with his hands. The next day, Fultz escaped and went to the apartment he shared with his wife Emily. He was very angry and demanded all five of his handguns. He *27 armed himself to prepare for an imagined FBI assault and stated that he would fight to the death to avoid again taking thorazine.
At the request of Emily Fultz, Dr. Cline spoke with Rick on the telephone and convinced him to return to the hospital. Fultz continued to talk of hurting people during this third period of hospitalization, and clinical tests suggested that he was likely to respond to stress with irritable outbursts of anger. During the same period, Dr. Cline spoke with the University police, who suggested to Cline that his patient's weapons be confiscated. Dr. Cline and Emily Fultz agreed, and she brought the guns to the police for safekeeping. The hospital released Fultz in June of 1970, but he continued to see Dr. Cline approximately once a week.
After his release, Fultz sought return of his guns from the University police. On July 29, 1970, Fultz contacted Dr. Cline and said that the police wanted a letter from Cline before they would return his handguns to him. Captain House of the University Police Department protested to Cline that Fultz should not have guns. Captain House also refused to turn them over unless he received assurances from Dr. Cline that Fultz was "cured."
On July 29, 1970, Dr. Cline wrote a letter to House stating that "[i]n my opinion Rick Fultz has recovered from his mental illness. I feel that he can have the firearms that have been deposited with you returned to him." The police turned the weapons over to Fultz after receiving that letter. Later, at his deposition, Dr. Cline stated that Rick Fultz was in remission from his psychosis at that time. When asked whether he complied with Fultz' request in order to signal his trust in his patient, Dr. Cline emphasized that developing trust is of "the utmost importance" in treating paranoid schizophrenics.
Dr. Cline continued to treat Fultz as an outpatient for the next 18 months. Cline thought his patient was making progress and was in remission from his mental disease. Dr. Cline last saw Rick Fultz as a patient on November 10, 1971. Following that meeting, Fultz continually missed his scheduled appointments, gave various excuses for his failure to come in, and rescheduled them. On November 24, Fultz told Dr. Cline that he had stopped taking his prescribed medication. Cline told Fultz to come in to see him, but Fultz failed to do so.
Some three weeks later, on December 16, 1971, Fultz entered a restaurant near the University and shot and killed Ruth Lundgren in an unprovoked and random attack. Fultz eventually committed suicide while serving a prison sentence for this murder.
Plaintiff sued Dr. Cline for the wrongful death of his wife, alleging that Cline had been "negligent in the care, treatment, and control of Defendant Rick Fultz, and failed to exercise reasonable prudence to protect persons whom [Cline] knew, or should have known, were in danger of physical harm from Defendant Rick Fultz." Plaintiff alleged that Cline had been negligent in at least three respects: (1) by failing to warn Fultz' family that he required hospitalization, (2) by failing to recommit Fultz to the hospital, and (3) by directing that Fultz' guns be returned to him.
Generally, a defendant has no duty to control the conduct of a third person to prevent that person from causing injury to another. Restatement (Second) of Torts § 315 (1965). Whether a duty exists depends on two factors: (1) whether a "special relationship" existed between the defendant and the third person and (2) the foreseeability of the harm.
In law, we are not our brother's keeper unless "a special relationship exists between the actor and the third person which imposes a duty upon the actor to control the third person's conduct." Id. Implicit in the duty to control is the ability to control. Id. at § 319 comments and illustrations. Viewing the evidence in the light most favorable to the plaintiff, a reasonable juror could conclude that Dr. Cline possessed some ability to control Rick Fultz' access to handguns. The University *28 police told Dr. Cline that they would not return the confiscated weapons without assurances of Fultz' "recovery." Dr. Cline alone made the decision to provide such assurance. A jury could conclude that the doctor possessed the ability to keep the handguns in police custody indefinitely simply by advising against their release. True, Dr. Cline could not entirely control his patient's use of handguns. Fultz was free to borrow or buy another gun; indeed, it appears the guns Fultz had were purchased by him after his first hospitalization. However, on this record, there is a genuine issue of fact whether Cline had ability to control, to some extent, Fultz' access to weapons. Although a close question, the "ability to control" is a question for the jury.
Even if the ability to control another's conduct exists, there is no duty to control that person unless the harm is foreseeable. Foreseeability has been called the fundamental basis of the law of negligence. Justice Cardozo succinctly expressed the central relationship between the foreseeability of harm and the existence of a legal duty in Palsgraf, stating that "[t]he risk reasonably to be perceived defines the duty to be obeyed * * *." Palsgraf v. Long Island R.R. Co., 248 N.Y. 339, 344, 162 N.E. 99, 100, 59 A.L.R. 1253, 1256 (1928). See also Christianson v. Chicago, St. P.M. & O. Ry. Co., 67 Minn. 94, 97, 69 N.W. 640, 641 (1896) (Mitchell, J.) ("What a man may reasonably anticipate is important, and may be decisive, in determining whether an act is negligent * * *."); W. Prosser, Handbook of the Law of Torts §§ 31 & 43 (4th ed. 1971).
It is also a close question whether the shooting was foreseeable. The question is whether it was reasonably foreseeable in July 1970 that (a) the patient would, a year and a half later, refuse his medication and have a reoccurrence of his illness and that (b) in the course of that reoccurrence, he would use his gun to shoot someone. The question before us is one of policy: Is the doctor's conduct so closely connected with the tragedy of the shooting that the law may allow a cause of action?
Close questions on foreseeability should be given to the jury. For example, in Illinois Farmers Insurance Company v. Tapemark Company, 273 N.W.2d 630 (Minn.1978), a car owner negligently left the keys to his unlocked car in the trunk and parked the vehicle in a lot where crowds of young people often gathered and loitered. Without attempting to conceal his activities, the car owner opened the trunk of the car by a trunk release button located in the glove compartment. He then got out of the car, removed his golf equipment from the trunk, tossed the car keys into the trunk, and closed the lid. The car was later stolen and involved in an accident, injuring the plaintiff. We reversed the trial court's grant of summary judgment in favor of the defendant car owner.
We held that the foreseeability of the vehicle's theft and involvement in an accident-causing injury due to the negligent placement of the keys was a question for the jury. Its resolution would depend upon the jury's view of other facts, including whether young people were loitering in the parking lot at the time defendant parked his car; if so, whether the defendant knew or should have known they were present, and whether he was aware that the parking lot had been plagued by thefts and vandalism in the recent past.
Here, Rick Fultz had twice been observed brandishing handguns in public places, and defendant Dr. Cline was fully aware of this. The psychiatrist also knew of Rick Fultz' violent thought and expression, as well as his plain fixation with guns. Fultz himself expressed fear of harming others and appeared to have fairly seethed with repressed rage and fear during each of his three hospitalizations.
Moreover, the police captain said that he considered it extremely unwise to return the handguns to Fultz. He also stated that he expressly told the psychiatrist that he would not return them unless the patient were, in his word, "cured" of his mental *29 disease. In response, the psychiatrist wrote a letter stating that Fultz had "recovered." From this, a jury could conclude that the psychiatrist's letter caused the police to return these guns and, thus, materially increased the danger that Fultz posed. A jury could also conclude that Fultz presented a danger to the public when armed with the handguns that figured so largely in his psychosis and that someone in Dr. Cline's position should have foreseen that harm to a member of the public might result.
In holding that this plaintiff has stated a cause of action, we recognize that, in other cases, policy considerations have made courts reluctant to extend the psychiatrist's duty to control the conduct of the patient too far. In Cairl v. State, 323 N.W.2d 20 (Minn.1982), for example, this court refused to impose a duty to warn potential victims of a patient's dangerous propensities unless the patient has made specific threats against identifiable persons. 323 N.W.2d at 25-26. The court was concerned that if such a duty were imposed, the resulting "cacaphony" of warnings would add greatly to the stigma of mental illness while contributing little to public protection. Id. In Leverett v. State, 61 Ohio App. 2d 35, 41, 399 N.E.2d 106, 110 (1978), the Ohio Court of Appeals declined to impose a duty to re-admit a patient. The court felt that this obligation would force psychiatrists to rely, at their peril, on lay persons' opinions of the danger posed by a patient. Id. at 399 N.E.2d at 110.
The policy considerations underlying the denial of a psychiatrist's duty in those cases are not present here. This case has its own special facts, including, as it does, the use of a handgun. In this case, a jury could find that Dr. Cline assisted his patient in gaining access to deadly handguns and that the patient later used one of those guns in a random homicide. There is a limit to the protection given the discretion in a professional relationship. That limit is exceeded where a psychiatrist places the gun in a potential assassin's hand under the guise of fostering trust between patient and psychiatrist. We do not believe that the imposition of a duty in those circumstances would contribute to the stigma of mental illness or impair a psychiatrist's professional discretion.
We believe Dr. Cline's duty was a professional duty, namely, whether he used that degree of care normally possessed and used by psychiatrists in good standing under like circumstances. There are many questions left unanswered in the record before us. It may be that plaintiff will be unable to prove a case, either to the trial court or the jury, but enough of a showing has been made to escape a summary judgment motion. See Olson v. Ratzel, 89 Wis. 2d 227, 278 N.W.2d 238 (Wis.Ct.App. 1979) (summary judgment for defendant who sold pistol to a minor who shot plaintiff premature).
Reversed and remanded for trial.
SCOTT and COYNE, JJ., took no part in the consideration or decision of this case. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603853/ | 354 N.W.2d 127 (1984)
217 Neb. 865
Ronald R. BENSON, Appellant,
v.
BARNES & BARNES TRUCKING, Defendant and Third-Party Plaintiff,
Nebraska Second Injury Fund, Third-Party Defendant, Appellees.
No. 83-400.
Supreme Court of Nebraska.
July 13, 1984.
*129 Larry R. Taylor of Taylor, Fabian, Thielen & Thielen, Omaha, for appellant.
William J. Dunn and Larry E. Welch of Gross, Welch, Vinardi, Kauffman & Day, P.C., Omaha, for appellee Barnes & Barnes Trucking.
Paul L. Douglas, Atty. Gen., and Martel J. Bundy, Asst. Atty. Gen., Lincoln, for appellee Second Injury Fund.
KRIVOSHA, C.J., and BOSLAUGH, WHITE, HASTINGS, CAPORALE, SHANAHAN, and GRANT, JJ.
KRIVOSHA, Chief Justice.
The appellant, Ronald R. Benson, an employee of the appellee Barnes & Barnes Trucking (employer), appeals from an order entered by a three-judge panel of the Nebraska Workmen's Compensation Court which, on rehearing, reversed an earlier award entered by a single judge of the Nebraska Workmen's Compensation Court. Employer had impleaded the Nebraska Second Injury Fund, which likewise was found by the three-judge panel not to be liable to the employee. For reasons more particularly set out hereinafter, we believe that the order of the three-judge panel must be in part affirmed and in part reversed.
The transcript discloses that on June 8, 1982, Benson filed a petition in the Nebraska Workmen's Compensation Court, alleging that on July 25, 1980, while in the employment of Barnes & Barnes Trucking, he sustained an injury in an accident arising out of and in the course of his employment. Specifically, Benson alleged that while he was unloading 100-pound bags of potatoes from a truck, he stumbled over a pallet and fell backwards with a bag of potatoes. The employer filed an answer admitting that Benson was one of its employees on July 25, 1980, and that, based upon the representations made by Benson, the employer has paid to employee temporary total disability benefits for 83 weeks at the rate of $180 per week for the period October 3, 1980, through May 6, 1982, for a total of $14,940; and, further, that it has paid permanent partial disability benefits for 5 weeks at the rate of $4.63 per week, for a total of $23.15, that "it continues to pay permanent partial disability at said rate," and that it has paid medical expenses on behalf of the employee in the amount of $18,555.09. The employer denied each and every other allegation of the petition, and alleged that any disability which Benson had at the time of the filing of the answer was the result of a deteriorating condition preexisting the alleged accident. By way of further answer the employer alleged that if indeed the employee was entitled to any further compensation or medical expense, such claim was a claim against the Second Injury Fund. The Second Injury Fund also filed an answer generally denying all of the allegations of the employee's petition and praying that the employee be placed on strict proof.
The single-judge compensation court found that the employee had established by sufficient proof that he was totally disabled and therefore entitled to an award. In its order the court divided the responsibility for compensation between the employer and the Second Injury Fund, 15 percent and 85 percent, respectively. It was from this order that the Second Injury Fund appealed; the employer elected not to appeal. On rehearing, the three-judge panel dismissed Benson's petition because it found that he had failed to prove by expert medical testimony, with sufficient certainty, that the present disability was caused by the accident which allegedly occurred on July 25, 1980. Apparently, the three-judge panel placed both the burden of proving that an accident or injury, arising out of and in the course of the employee's employment, had occurred and the burden of proving the liability of the Second Injury Fund, as though they were interrelated, upon the employee. We believe that, in so doing, the three-judge panel committed error. It appears to us that there are really two separate issues involved in this case. The first *130 issue, raised by the employee, involves the question of whether the employee's current condition is as a result of an accident which occurred on July 25, 1980, and which accident arose out of and in the course of employee's employment. The second issue is whether the Second Injury Fund is liable for some part of the injury and resulting disability. These issues are separate and distinct and should be so viewed.
We turn, then, to what we perceive to be the first issue: Did Benson, on July 25, 1980, suffer a personal injury caused by an accident arising out of and in the course of his employment for which he is entitled to compensation pursuant to the Nebraska workmen's compensation law? To answer this question it is necessary that we review the facts. The record discloses that prior to Benson's employment by Barnes & Barnes, Benson was employed by Missouri River Industries, Inc. On January 31, 1977, while its employee, he slipped and fell on the ice and a 2,400-pound cart of meat, which he was pulling, ran over him. As a result of the accident, he injured his back. In July of 1977 Benson underwent back surgery performed by Dr. William Smith, an orthopedic surgeon. The surgery consisted of a laminectomy on the left side at the L4-5 space. Following the surgery, the plaintiff returned to work with instructions to lift no more than 20 pounds. On February 26, 1978, Benson again slipped on a piece of cardboard and fell. In March of 1978 Dr. Smith again performed a laminectomy at the L4-5 space, this time on the right side. Following these two incidents, in September of 1978, Benson entered into a lump sum settlement with his then employer, based upon a finding that Benson had sustained a 37.5 percent disability to the body as a whole. Although he continued to experience some back pain, Benson worked at a series of truck driving jobs, none of which involved lifting.
Then, on July 25, 1980, while in the employ of Barnes & Barnes Trucking, Benson tripped on a pallet while unloading a truck and fell with a 100-pound sack of potatoes. Two days after the incident, Benson was treated by Dr. Smith in the emergency room at Methodist Hospital in Omaha, Nebraska, and was again seen and treated by Dr. Smith in August and September of 1980. Benson continued to work; however, the work Benson did was with the assistance of his wife, who also was a truckdriver. On October 3, 1980, the record reflects that Benson simply collapsed when his "legs gave out," and he fell to the floor. There was no new incident which precipitated that fall as reflected by the record. Following this October incident, Dr. Smith once again performed a laminectomy on the L4-5 space, again on the left side, during which he removed degenerated disk material. Everyone agrees that Benson has not worked again since October 3, 1980.
While home recovering, Benson suffered two further accidents. In December 1980 he fell down a flight of stairs in his home. As a result of this accident, Benson was once more hospitalized, in February of 1981, and in July of 1981 was again operated on by Dr. Smith, at which time Dr. Smith performed a fusion to eliminate motion at L4-5 and L5-S1. Then, in October of 1981, Benson again fell down a flight of stairs in his home, and in March of 1982 a double laminectomy was performed at the L4-5 and L5-S1 spaces on the right side. Benson contended that these subsequent falls were caused by reason of his inability to walk properly and that his inability to walk properly related back to the injury which occurred on July 25, 1980, and the subsequent surgery which was necessitated by that accident.
While we recognize that in reviewing the judgment of the compensation court after rehearing, we must keep in mind that its findings have the effect of a jury verdict and will not be set aside on appeal unless clearly wrong, Taylor v. Benton, 205 Neb. 203, 286 N.W.2d 755 (1980), we are also aware of the fact that if the judgment and order of the court is not supported by the evidence, we are required to reverse it. Neb.Rev.Stat. § 48-185 (Reissue 1978). We believe such to be the case here with regard to the question of *131 whether Benson suffered an accident arising out of and in the course of his employment for which he is entitled to compensation. The burden of proving that he suffered an accident arising out of and in the course of his employment, entitling him to compensation, is unquestionably on the employee. In Novotny v. Electric Hose & Rubber Co., 214 Neb. 216, 219, 333 N.W.2d 406, 409 (1983), we said:
Under the Nebraska Workmen's Compensation Act, the claimant has the burden of proof to establish by a preponderance of the evidence that an unexpected and unforeseen injury was in fact caused by the employment. There is no presumption from the mere occurrence of such unexpected or unforeseen injury that the injury was in fact caused by the employment.
See, also, Newbanks v. Foursome Package & Bar, Inc., 201 Neb. 818, 272 N.W.2d 372 (1978); Randall v. Safeway Stores, 215 Neb. 877, 341 N.W.2d 345 (1983). And we acknowledge that where there is knowledge of a preexisting condition, the claimant carries a greater burden of proof. In Engel v. Nebraska Methodist Hospital, 209 Neb. 878, 881, 312 N.W.2d 281, 284 (1981), we said: "The employee must prove the injury was not the result of the normal progression of his preexisting condition which would have been sustained even in the absence of the accident." We went on to say at 883, 312 N.W.2d at 285: "The question simply is whether the plaintiff suffered an injury arising out of and in the course of his employment which aggravated the preexisting condition and resulted in the disability."
In light of these rules it appears to us that Benson has sustained his burden. No one, including Benson's employer, seriously disputes that he suffered an accident on July 25, 1980, when he tripped over a pallet and fell with a 100-pound bag of potatoes. Moreover, no one disputes that Benson is currently totally disabled. It appears to us that it is by reason of the employer having injected the Second Injury Fund into the case that confusion as to the employee's burden has occurred. The employer aregues that the medical testimony produced by Benson was insufficient to establish causation. We do not read the record that way.
On direct examination Dr. Smith, by deposition, was asked whether he had an opinion as to the cause of Benson's disability. He said that he did, and when asked to give his opinion, testified as follows: "The disability that he has now is from the multiple surgeries that he's had and the disc herniations, and the rating that I would tie him to now is a culmination of all of these things, the recurrent injuries that he had and the subsequent surgeries." The record makes clear that the injury sustained in the July 1980 accident required surgery in October 1980. Dr. Smith candidly admitted that there was no way he could specifically separate one from the other, because the current condition was "kind of a cumulating effect." The three-judge panel concluded that Dr. Smith's testimony was speculative in nature and was insufficient to establish causation. We do not believe that to be the case.
Unlike Taylor v. Benton, supra, where there was evidence from which the three-judge panel could believe that even absent an alleged accident which arose out of and in the course of Taylor's employment, she nevertheless would have sustained the difficulty she in fact encountered and would have required the surgery which was performed, the evidence in this case is otherwise. Dr. Smith was not vague about the cause of Benson's total disability. He was quite specific. He said that it was the accumulation of the various injuries. That is to say, that by reason of a preexisting condition aggravated by a subsequent injury, requiring several operations, Benson was now totally disabled. There is nothing vague or indefinite about this testimony, nor is the testimony insufficient to entitle the employee to recover. For reasons known only to the employer, no expert evidence was tendered by the employer to contradict anything said by Dr. Smith. No effort was made to show that *132 notwithstanding the second injury, Benson would have suffered whatever difficulty he ultimately suffered, and even absent the second injury, would have required the subsequent surgery and would have ultimately been totally disabled. We have never held that an injury made worse by reason of a preexisting condition prevents an employee from receiving compensation. Quite to the contrary, we have consistently held that where an injury arising out of and in the course of employment combines with a preexisting condition to produce disability, though absent the preexisting condition no disability would have resulted, recovery can be had by the employee. See, Chatt v. Massman Construction Co., 138 Neb. 288, 293 N.W. 105 (1940); Maul v. Iowa-Nebraska Light & Power Co., 137 Neb. 128, 288 N.W. 532 (1939); Dymak v. Haskins Bros. & Co., 132 Neb. 308, 271 N.W. 860 (1937). Once Benson established that he suffered an injury arising out of and in the course of his employment, which, together with a preexisting condition, caused his permanent and total disability, he satisfied his burden of proof. If the employer wished to show that this condition would have prevailed, notwithstanding the intervening accident, the burden was upon the employer to do so.
Recently, in the case of White v. Western Commodities, Inc., 207 Neb. 75, 295 N.W.2d 704 (1980), we were confronted with a somewhat similar situation. There, the compensation court allowed recovery, notwithstanding the fact that the physician was unable to separate the extent of disability between an earlier service-connected disability and an employment accident. When specifically asked to separate the two, the doctor testified, "I can't separate the two." Id. at 84, 295 N.W.2d at 710. And, in affirming the compensation court, we noted at 86, 295 N.W.2d at 711:
"The primary purpose of the workmen's compensation act is to insure an employee against accidental injury arising out of and in the course of his employment. To accomplish this purpose the act should be liberally construed, not to find that liability exists without the required quantum of proof, but to include within the protection of the act by liberal interpretation all injuries arising out of and in the course of the employment which the act does not clearly exclude. A strict interpretation should not be resorted to in order to accomplish such exclusion."
By dismissing the plaintiff's petition in its entirety, the three-judge panel found, in effect, that Benson had failed to prove that he was entitled to any compensation for medical expenses, including the substantial sum which the employer had already paid to him. While the payment by the employer does not, in and of itself, constitute an admission, nevertheless, it is difficult to perceive how the three-judge panel could find that Benson had not suffered any compensable injury or be entitled to any medical expense by reason of his fall on July 25, 1980. The evidence clearly established that this fall was compensable in some degree and, when combined with his preexisting condition, necessitated the subsequent surgery and caused the ultimate disability.
One may argue that the subsequent falls down the stairs, resulting in further disability and expense, should not be treated as a part of the accident which occurred on July 25, 1980. The record is clear, however, and the employer sought to introduce no evidence to contradict the record to this effect, that as of October 1980, Benson was already totally and permanently disabled and that his inability to properly maneuver in 1980 and 1981 was the cause of his falling down the stairs. If such was not the case, then the employer had some burden to introduce contrary evidence. The compensation court, therefore, erred in not finding that Benson had met his burden of proof and that he was entitled, at that point, to be compensated.
The second issue which must then be considered is the liability of the Second Injury Fund, if any, and, specifically, the question of who has the burden of proof with regard to this issue. While it appears that we have never before had an occasion to pass upon this question, it further appears clear to us that a reading of the *133 statute imposes the burden upon the employer for whose benefit the Second Injury Fund was principally created. Neb.Rev. Stat. § 48-128 (Reissue 1978) provides in part:
If an employee who has a preexisting permanent partial disability whether from compensable injury or otherwise, which is or is likely to be a hindrance or obstacle to his obtaining employment or obtaining reemployment if the employee should become unemployed and which was known to the employer prior to the occurrence of a subsequent compensable injury, receives a subsequent compensable injury resulting in additional permanent partial or in permanent total disability so that the degree or percentage of disability caused by the combined disabilities is substantially greater than that which would have resulted from the last injury, considered alone and of itself; and if the employee is entitled to receive compensation on the basis of the combined disabilities, the employer at the time of the last injury shall be liable only for the degree or percentage of disability which would have resulted from the last injury had there been no preexisting disability, and for the additional disability the employee shall be compensated out of a special trust fund created for that purpose, which sum so set aside shall be known as the Second Injury Fund.
(Emphasis supplied.) The purpose of the statute is clear. If an employer, knowing that an employee has a preexisting condition, agrees nevertheless to employ the individual and the employee subsequently suffers a second injury which, but for the preexisting condition, would have produced a lesser degree of injury and disability and, therefore, a smaller payment by the employer, then the employer is only required to pay for that portion of the total injury which would have occurred without the preexisting condition. The balance is to be paid out of the Second Injury Fund. It is, therefore, in the interests of the employer to establish that the extent of disability now experienced by the employee was increased by the preexisting condition and, therefore, the employer should only be required to pay for a proportion of the disability.
As we have already noted, an employee is entitled to full compensation, notwithstanding the fact that his present disability is the result of an aggravated preexisting condition. Absent the provisions of § 48-128, an employer would be liable for all of the injury. Therefore, the general rules with regard to burden of proof seem to demand that the burden of proving apportionment between the portion of the injury for which the employer is liable and the portion for which the Second Injury Fund is liable must be on the employer. The employee is not interested in who pays him the money, so long as he receives it. And he is entitled to receive compensation notwithstanding the existence of a preexisting condition. To therefore impose upon the employee the burden of proving both that he suffered an accident arising out of and in the course of his employment and also what proportion should be paid by the employer and what portion by the Second Injury Fund is to impose upon the employee a burden which should not be placed on him.
Just noting how the Second Injury Fund is made a party to this case should make it clear as to where the burden lies. It was not Benson who made the Second Injury Fund a party to this action but, rather, the employer who did so, saying, in effect, that if there is liability on the employer, then a portion of it should be paid by the Second Injury Fund. And, in fact, when the single-judge court entered an award assessing liability to the employer in the amount of 15 percent and liability to the Second Injury Fund in the amount of 85 percent, the employer chose not to appeal. The employer's joining of the Second Injury Fund is in every respect akin to making the Second Injury Fund a third-party defendant, and the rules with regard to third-party practice should apply here as everywhere else. See Mobil Oil Corp. v. Grantham, 200 Neb. 782, 265 N.W.2d 669 (1978), in which this court held that a defendant *134 who cross-claims has the burden of proving the facts necessary to recover on its cross-claim. The burden of proof is generally upon the party who, absent meeting his burden, is not entitled to relief. Empire State Building Co. v. Bryde, 211 Neb. 184, 318 N.W.2d 65 (1982). In the instant case it is the employer who will suffer if evidence of apportionment is not introduced, and, therefore, it is the employer who should assume the burden of proving such facts. We therefore hold that the burden of proof necessary to establish apportionment under § 48-128, the Second Injury Fund statute, is upon the employer who seeks the benefits of that statute. See, Masotto v. Atlantic & Pac. Tea Co., 70 A.D.2d 714, 416 N.Y.S.2d 433 (1979); Texas Employers' Ins. Ass'n v. Haunschild, 527 S.W.2d 270 (Tex.Civ.App.1975); Scott v. Day and Zimmerman, Inc., 215 Kan. 782, 529 P.2d 679 (1974). The three-judge panel was correct in determining that the employer had failed to prove apportionment and, therefore, should have dismissed the petition against the Second Injury Fund. It committed error, however, in not entering an award for Benson based upon the evidence. The judgment of the three-judge panel of the compensation court is therefore affirmed insofar as it found the Nebraska Second Injury Fund not liable in this case and is reversed and remanded with directions to enter an award on behalf of Benson consistent with this opinion.
AFFIRMED IN PART, AND IN PART REVERSED AND REMANDED WITH DIRECTIONS. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603880/ | 8 So. 3d 1024 (2008)
Jeffery Richard DOSECK
v.
STATE of Alabama.
CR-07-0198.
Court of Criminal Appeals of Alabama.
September 26, 2008.
Shannon A. Rash, Dothan, for appellant.
Troy King, atty. gen., and Laura I. Cuthbert, asst. atty. gen., for appellee.
WELCH, Judge.
The appellant, Jeffery Richard Doseck, pleaded guilty to second-degree escape, a violation of § 13A-10-32, Ala.Code 1975. Doseck was sentenced, as a habitual felony offender, to 15 years' imprisonment, 14 years of which were suspended, with one year to be served through the Houston County Department of Community Corrections and three years' probation.
Before entering his guilty plea, Doseck expressly reserved the right to appeal the circuit court's denial of his motion to dismiss the indictment on the ground that, based on the facts of his case, the indictment erroneously charged him with the felony offense of second-degree escape instead of the misdemeanor offense of failing to remain within the extended limits of confinement or failing to return to the place of confinement within the time prescribed, a violation of § 14-8-42, Ala.Code 1975.
At the time of his escape, Doseck was serving a sentence through the Houston County Department of Community Corrections work-release program for his conviction of the misdemeanor offense of negotiating a worthless negotiable instrument. On March 21, 2007, Doseck failed to return to the jail at the designated time of 7:00 p.m. He returned to the jail at approximately 10:00 on the following morning. He was subsequently indicted for second-degree escape.
Doseck's motion is based upon his contention that the State cannot present sufficient evidence to sustain a conviction for escape in the second degree. This court has previously held that a lack of evidence as to the elements of the offense charged in the indictment cannot be the basis for the pretrial dismissal of an indictment. In State v. Foster, 935 So. 2d 1216, 1216-17 (Ala.Crim.App.2005), this court explained its rationale as follows:
*1025 "Rule 13.5(c)(1), Ala. R.Crim. P., provides:
"`A motion to dismiss the indictment may be based upon objections to the venire, the lack of legal qualifications of an individual grand juror, the legal insufficiency of the indictment, or the failure of the indictment to charge an offense.'
"The State is correct in its contention that Rule 13.5(c)(1) does not provide for the dismissal of an indictment based on the insufficiency of the evidence or, as in this case, a possible lack of evidence. See State v. Edwards, 590 So. 2d 379 (Ala.Crim.App.1991) (establishment of the corpus delicti requires proof of facts by the State so entwined with the merits of the case that a decision as to whether it had been proved should not be made before trial but should be postponed until trial); State v. McClain, 911 So. 2d 54 (Ala.Crim.App.2005) (trial court cannot dismiss the indictment based on a lack of evidence)."
Therefore, the indictment cannot be dismissed on the grounds Doseck raises on appeal in this case.
The dissent agrees that a motion to dismiss an indictment is not the proper avenue for challenging the sufficiency of the evidence. The dissent then states that this court has improperly considered Doseck's motion based on its style rather than its substance and that, in this case, the substance of the motion "was purely a question of lawwhether the undisputed facts constituted felony escape or misdemeanor escape." 8 So.3d at 1026. The dissent further asserts that "[t]he trial court, in denying Doseck's motion, effectively ruled that, as a matter of law, his actions constituted felony escape and not misdemeanor escape, and Doseck properly reserved that ruling of law for review on appeal during the guilty-plea colloquy." 8 So.3d at 1026. However, a trial court does not give advisory opinions on pure questions of law. Here, the trial court was asked to dismiss the indictment based on an argument that the State could not prove the facts necessary to constitute escape in the second degree, and it denied that motion. It is unclear what motion or pleading was contemplated by the dissent. Whether the trial court's legal opinion about whether the State had properly charged Doseck with escape in the second degree, based upon what the dissent argued were essentially stipulated facts, was correct or incorrect is not material to the issue decided in this case. That issue is whether a trial court can dismiss an indictment before trial based upon an expected failure of the State to be able to prove the facts constituting the offense charged in that indictment.
The dissent would create a mechanism for examining the validity of the factual underpinning of indictments that is not contemplated by the Alabama Rules of Criminal Procedure. Rule 13.5(c)(1), Ala. R.Crim. P., "does not provide for the dismissal of an indictment based on the insufficiency of the evidence or, as in this case, a possible lack of evidence." Foster, 935 So.2d at 1217. In his pretrial motion, Doseck asked the court to dismiss his indictment on a ground that would require the circuit court to determine whether the facts sufficed to establish the charged offense. There is no Rule of Criminal Procedure that provides a mechanism for a pretrial challenge to the sufficiency of the evidence. This court is not empowered to add such a mechanism to the Alabama Rules of Criminal Procedure.
This is not to suggest that a defendant cannot challenge an indictment on constitutional grounds or other grounds allowed by rule, by statute, or by other law. Because Doseck's motion to dismiss the indictment was based on a challenge of the *1026 sufficiency of the evidence, the trial court properly denied the motion. Accordingly, the judgment of the trial court is affirmed.
AFFIRMED.
BASCHAB, P.J., and WISE, J., concur. McMILLAN, J., concurs in the result. SHAW, J., dissents, with opinion.
SHAW, Judge, dissenting.
I agree with the majority that a motion to dismiss an indictment is not the proper avenue for challenging the sufficiency of the evidence. However, the majority fails to acknowledge the well settled principal that "[t]he substance of a motion and not its style determines what kind of motion it is." Evans v. Waddell, 689 So. 2d 23, 24 (Ala.1997). See also Boykin v. Law, 946 So. 2d 838 (Ala.2006) (treating a motion to dismiss as a motion to set aside a void judgment under Rule 60(b), Ala.R.Civ.P.); Stabler v. City of Mobile, 844 So. 2d 555 (Ala.2002) (treating motion to dismiss as a motion for summary judgment); and Ex parte S.W.T., 782 So. 2d 766, 767 (Ala.2000) (treating a motion requesting "`an enlargement of time in which to file a post-trial motion'" as a motion requesting an extension of time for an appeal pursuant to Rule 77(d), Ala.R.Civ.P.). The fact that Jeffery Richard Doseck's pretrial motion challenging whether his actions constituted felony escape was styled as a "Motion to Dismiss" is not dispositive of this appeal, as the majority concludes.
Although Doseck's motion was styled as a motion to dismiss, and in it Doseck requested dismissal of the indictment against him, as Doseck noted in his rebuttal to the State's response to his motion, "[t]he issue is whether or not an individual who violates the conditions of work release [by not returning to his work-release facility as scheduled] can be charged with [and convicted of] a felony when that individual is at work release due to misdemeanor convictions." (C. 9.) Doseck admitted in his motion that he failed to return to his work-release facility at his scheduled time, i.e., he stipulated to the facts as alleged by the State. The only issue presented to the trial court was purely a question of law whether Doseck's undisputed actions constituted felony escape or misdemeanor escape. See, e.g., Ex parte J.C.C., 4 So. 3d 1188 (Ala.2008). The trial court, in denying Doseck's motion, effectively ruled that, as a matter of law, his actions constituted felony escape and not misdemeanor escape, and Doseck properly reserved that ruling of law for review on appeal during the guilty-plea colloquy. I would not penalize Doseck for not styling his motion properly when the pure question of law presented to this Court was properly presented to the trial court, ruled on by the trial court, and properly reserved for appellate review.
I would address the issue presented; therefore, I respectfully dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603900/ | 645 So. 2d 59 (1994)
Ernest M. STEELE, Appellant,
v.
STATE of Florida, Appellee.
No. 93-3812.
District Court of Appeal of Florida, Fourth District.
November 2, 1994.
Ernest M. Steele, pro se.
No appearance required for appellee.
ON MOTION FOR REHEARING
PER CURIAM.
Defendant has moved for rehearing of our opinion filed April 20, 1994. We withdraw our opinion, substitute the following opinion and deny defendant's motion for rehearing.
Defendant appeals the summary denial of his motion for post-conviction relief. In the first verified motion, defendant alleged that his plea was involuntary because his trial counsel failed to inform him that he would not be eligible for gain time as a habitual offender. After the state responded with case law demonstrating that defendant's argument was legally insufficient, defendant filed a sworn motion to amend. He alleged that he had made several "typos" in his motion and that he had really meant to state that his trial counsel had affirmatively misrepresented *60 to him that he would be eligible for gain time under the plea agreement. Defendant's explanation that his substantially changed story from the first motion to the second motion was a typographical error lacks any semblance of believability.
Even accepting defendant's belated story as true, we nonetheless affirm the trial court's denial of defendant's motion for post-conviction relief. On the issue of counsel's alleged misrepresentation of defendant's eligibility for gain time, the record reflects defendant's acknowledgment at his plea hearing that no "promises," other than those referred to at the plea hearing, had been made to him by anyone. This inquiry and response is sufficient to support a summary denial of his claim. See Zaetler v. State, 627 So. 2d 1328 (Fla. 3d DCA 1993), rev. denied, 639 So. 2d 984 (Fla. 1994).
However because gain time affects the length of a defendant's incarceration, we agree with the second district in Carmichael v. State, 631 So. 2d 346 (Fla. 2d DCA 1994), which announced in dicta, that it would be preferable for a trial court to ask a specific question as to promises concerning gain time:
It would be a simple matter during the plea dialogue to have the defendant affirm under oath that no one, especially the defendant's counsel, has made any promises concerning eligibility for any form of early release authorized by law and the actual amount of time to be served under the sentence to be imposed. It would also be beneficial to have the defendant further acknowledge the absence of such promises in a written plea form, if one is routinely used by the judge.
Although we are not holding that such an inquiry is required, see Dolan v. State, 618 So. 2d 271, 273 n. 2 (Fla. 2d DCA 1993), such a procedure would add little to the burdens of the trial bench and would hopefully result in facilitating summary disposition of this type of case at the trial and appellate levels... .
Id. at 347 (emphasis added).
In Carmichael, an evidentiary hearing was required because there was no inquiry by the trial court as to any promises made to the defendant apart from those discussed during the plea colloquy; thus, it is distinguishable from this case. Here an inquiry as to such promises was made, which is sufficient to summarily defeat defendant's motion, especially in light of the dubious manner in which his claims and sworn allegations were presented to the court.
GLICKSTEIN and PARIENTE, JJ., and HARRY LEE ANSTEAD, Associate Judge, concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603897/ | 882 F. Supp. 184 (1995)
KERRY B., Plaintiff,
v.
UNION 53 PUBLIC SCHOOLS, Defendant.
Civ. A. No. 92-10278-PBS.
United States District Court, D. Massachusetts.
March 21, 1995.
*185 *186 Thomas F. Schiavoni, McGee & Schiavoni, Lynn, MA, for plaintiff.
Richard N. Sullivan, Kenney, Conley, Sullivan & Smith, Braintree, MA, for defendant.
MEMORANDUM OF DECISION AND ORDER
SARIS, District Judge.
This case involves the appropriate educational placement of plaintiff Kerry B., a severely mentally retarded girl with autistic behavior, by the defendant Pentucket Regional School District (Union 53). Plaintiff seeks attorneys fees under the fee-shifting provision of the Individuals with Disabilities Education Act (IDEA), 20 U.S.C. § 1415(e)(4)(B). On October 14, 1994, the magistrate judge issued a report and recommendation denying attorneys fees on the ground plaintiff was not a prevailing party, and plaintiff filed timely objections pursuant to Rule 3(b) of the Rules for Magistrates. Pursuant to 28 U.S.C. § 636(b), this Court must make a de novo determination of those recommendations. After hearing and review of the record, the court declines to adopt the report and recommendation and orders entry of judgment in favor of the plaintiff for attorney fees in the amount of $22,700.79.
DISCUSSION
The factual background recited by the Magistrate Judge's Report and Recommendation is incorporated by reference and adopted except where stated:
A. Prevailing Party Standard
Section 1415(e)(4)(B) provides:
In any action or proceeding brought under this subsection, the Court, in its discretion, may award reasonable attorneys' fees as part of the costs to the parents or guardian of a child or youth with a disability who is the prevailing party.
The standard governing attorneys fees disputes under the IDEA is the same as that developed in the context of civil rights statutes containing fee-shifting provisions, such as 42 U.S.C. § 1988. See, e.g., Phelan v. Bell, 8 F.3d 369, 373 (6th Cir.1993); Fenneman v. Town of Gorham, 802 F. Supp. 542, 546 (D.Me.1992); Mr. D. v. Glocester Sch. Cte., 711 F. Supp. 66, 68 (D.R.I.1989). The seminal case in this area is Judge Coffin's opinion in Nadeau v. Helgemoe, 581 F.2d 275 (1st Cir.1978). Nadeau set forth two separate tests for the awarding of attorneys' fees to a prevailing party: the merits test and the catalyst test.
*187 1. Merits Test
Under the merits test, a prevailing party is one who "has succeeded on `any significant issue in litigation which achieve[d] some of the benefit the [plaintiff] sought in bringing suit' ..." Texas State Teachers Ass'n v. Garland Indep. Sch. District, 489 U.S. 782, 791-92, 109 S. Ct. 1486, 1493, 103 L. Ed. 2d 866 (1983) (quoting Nadeau, 581 F.2d at 279). "[A]t a minimum ... the plaintiff must be able to point to a resolution of the dispute which changes the legal relationship between itself and the defendant." Texas Teachers, 489 U.S. at 792, 109 S.Ct. at 1493. Even under this "generous formulation", the plaintiff cannot qualify as a "prevailing party" if his "success on a legal claim can be characterized as purely technical or de minimis ..." Id. "The touchstone of the prevailing party inquiry must be the material alteration of the legal relationship of the parties in a manner which Congress sought to promote in the fee statute." Id. at 792-793, 109 S.Ct. at 1493.
Thus the "prevailing party" criteria endorsed in Texas Teachers inquire whether the plaintiff obtained relief on a significant claim in litigation, effecting a material alteration in the parties' legal relationship, that is not merely technical or de minimis in nature. Texas Teachers, 489 U.S. at 791-93, 109 S.Ct. at 1492-93. "In short, a plaintiff `prevails' when actual relief on the merits of his claim materially alters the legal relationship between the parties by modifying the defendant's behavior in a way that directly benefits the plaintiff." Farrar v. Hobby, ___ U.S. ___, ___, 113 S. Ct. 566, 573, 121 L. Ed. 2d 494 (1992) (surveying recent Court case law).
The degree of success achieved in the litigation is a "critical" factor in fixing the amount of an award. Texas Teachers, 489 U.S. at 789-90, 109 S.Ct. at 1492. See also Farrar v. Hobby, ___ U.S. ___ - ___, 113 S.Ct. at 574-75 (a plaintiff who seeks compensatory damages but receives no more than nominal damages is often a party who formally prevails but who should receive no attorney's fees at all because fee awards were never intended to produce "windfalls to attorneys").
2. Catalyst Test
Under the catalyst test of the First Circuit, plaintiffs may be considered prevailing parties "when they vindicate rights through a consent judgment or without formally obtaining relief." Nadeau, 581 F.2d at 279. "[W]hen plaintiff's lawsuit acts as a `catalyst' in prompting defendants to take action to meet plaintiff's claims, attorney's fees are justified despite the lack of judicial involvement in the result." Id.; see also Maher v. Gagne, 448 U.S. 122, 129, 100 S. Ct. 2570, 2575, 65 L. Ed. 2d 653 (1980). The good faith of defendants is not a controlling factor in determining whether or not plaintiffs merit an award. Nadeau, 581 F.2d at 280. "The key issue is the provocative role of the plaintiff's lawsuit, not the motivations of the defendant." Id. Where the plaintiff's efforts were a "necessary and important factor" in achieving the improvements, plaintiffs should be held "to have overcome their first hurdle toward their goal of recovering some attorneys fees." Id. at 281. This is not an "all or nothing determination", and based on many factors, the Court may reduce the amount of attorneys fees, for example, where the beneficial results are attributable to both parties. Id. Even if plaintiff can establish that the action was causally related to the defendant's actions which improved her condition, plaintiff must also establish that the conduct was required by law and not gratuitous. Id.
As stated recently by the First Circuit, under the catalyst theory, plaintiff must demonstrate "(1) a causal connection between the litigation and the relief sought and (2) that the success was not obtained by a gratuitous gesture of the fee-target." Paris v. U.S. Dept. of Hous. & Urban Dev., 988 F.2d 236, 241 (1st Cir.1993); see also Pearson v. Fair, 980 F.2d 37, 44 (1st Cir.1992) (plaintiff must prove that the lawsuit caused the sought after improvements, and the improvements were more than of minor significance).
B. The First Hearing
The first hearing before the Board of Special Education Appeals (BSEA) considered two questions: (1) whether the *188 1991-92 Individual Education Plan (IEP) designed for Kerry was "appropriate" so as to "assure her maximum feasible educational development in the least restrictive environment consistent with that goal"; and (2) if not, whether it would be appropriate to place Kerry in a residential program. The hearing officer concluded that the IEP was largely appropriate, and that residential placement was "overly restrictive for this student at this point in time." He did, however, order compensatory physical therapy services. In a post-hearing ruling regarding the plaintiff's prevailing party status, the hearing officer made the following findings:
[T]he substantive components of the public school program, adjudged appropriate for the student, were not altered, augmented or enhanced to any significant degree by said decision.
Parents did, however, secure an order as to provision of compensatory physical therapy services pursuant to the terms of the decision. It should be noted that the sufficiency of the physical therapy service plan was not challenged at hearing, nor was the issue of compensatory services raised by parents. However, as evidence elicited during the hearing revealed that provision of physical therapy services did not commence in timely fashion at the beginning of the academic year, compensatory services were ordered to redress this. With regard then to this limited issue, parents should be assigned prevailing party status.
(Emphasis added).
In this context the hearing officer, as a fact-finder, is entitled to deference only for fact-based inquiries. See Domegan v. Ponte, 972 F.2d 401, 406-07 & n. 8 (1st Cir.1992) (discussing cases) vacated on other grounds, ___ U.S. ___, 113 S. Ct. 1378, 122 L. Ed. 2d 754 (1993). Neither side disputed the hearing officer's factual finding that the claim for compensatory physical therapy services was not raised by the parents. However, the determination of whether plaintiff met the "prevailing party" test by prevailing on this "limited issue" is a question of law. Id.
Because plaintiff failed to achieve the "primary goal" of placement in a residential facility, the magistrate judge held that she "did not succeed as to any significant issue, or achieve the benefit sought by bringing suit at the conclusion of the first hearing." (Emphasis added). Although the magistrate judge fairly points out that plaintiff did not prevail on her claim that the IEP was inappropriate, she did achieve some of the benefit sought in the litigation improved educational services to assure her maximum feasible educational development. Under the merits test, plaintiff is a prevailing party because the compensatory physical therapy ordered by the BSEA effected a material alteration in the parties' legal relationship in a manner Congress sought to promote in the fee statute. See Krichinsky v. Knox County Schools, 963 F.2d 847, 850 (6th Cir.1992) (although parents were primarily seeking residential placement, the order to provide the student with additional therapy changed the "legal relationship"). Plaintiffs who prevail in the sense of obtaining relief that was not requested by them, but that was called into play by their claims, may be entitled to attorney's fees, for they have obtained "some of the benefit [they] sought in bringing suit." Nadeau, 581 F.2d at 279. Cf. Mitten v. Muscogee Cty. Sch. Dist., 877 F.2d 932, 936 (11th Cir.1989) (noting that, under IDEA, "free and appropriate education" is both "the fundamental objective" and "the significant relief sought").
Although plaintiffs never made a specific demand for compensatory physical therapy services, the evidence at the hearing flagged the need for physical therapy. Litigation is not an all or nothing endeavor. Many courts have ruled that parents may be considered prevailing parties in an IDEA dispute if they obtain a significant revision of their child's IEP, even if they do not obtain the maximal objective of having their child placed in a residential facility. See, e.g., Krichinsky v. Knox Cty. Schools, 963 F.2d at 849-50 (IEP revised to include increased speech therapy and occupational therapy, and at-home behavioral management); Mitten, 877 F.2d at 936-37 (IEP revised to include 8 hours of instruction by licensed teachers during school day); Fenneman, 802 F.Supp. at 546-48 (IEP revised to include extended day academic program, instruction in study skills *189 and assistance in extracurriculars); In re Mary S., B.S.E.A. No. 87-0805, slip op. at 7 (May 27, 1988) (IEP revised to include increased special education services and modifications to regular education, more appropriate class size and level, stricter coordination and oversight). While plaintiff's success was quite limited, it was not de minimis. The degree of success governs the amount of attorney fees awarded, not whether plaintiff qualifies as a prevailing party.
C. The Second Hearing
Kerry completed the 1991-92 school year under her IEP. She attended school for a few days the following year, at which point her parents noticed that her body was covered with bruises. The parents withdrew Kerry from school, and filed a second appeal to the BSEA, seeking an emergency interim placement at a residential facility. A hearing was held on September 18, 1992 and a decision issued on October 23, 1992. The parents' position, according to the hearing officer, included not only the contention that the public school placement was not "safe" for Kerry, but also the contention that the "restraint procedures utilized by the classroom teacher were not written into the IEP, nor was parental consent sought or received for use of restraint."
The hearing officer concluded that both parties had acted in good faith with the school authorities attempting to respond appropriately to Kerry's worsening behavioral problems, and the parents understandably upset over the resultant physical bruising to their daughter. The videotape provided by plaintiff amply demonstrates the basis for the parents' good faith concern. The officer rejected the parents' request for an emergency residential placement, but agreed that the school's failure to include physical restraints in the IEP, and the failure to obtain parental permission for such restraints, were in violation of the statute. She further noted that the placement of Kerry in a residential facility pursuant to normal procedures had become a distinct possibility; and ordered Kerry's supervisory team to convene immediately with Kerry's parents, to reconsider her needs in light of evolving circumstances. The team met soon thereafter and resolved to place Kerry in a residential facility.
The magistrate judge rejected the argument that plaintiff's legal actions at the two BSEA hearings were a catalyst for Union 53's subsequent placement of Kerry in a residential facility. With respect to the first hearing, there is no evidence it was a catalyst for the educational placement the following school year. However, the administrative record supports a different conclusion with respect to the second hearing. The magistrate judge concluded that Kerry's residential placement was the result of her regression during the 2½ month period in which her parents took the "unilateral action" of withdrawing her from school. Plaintiff strenuously objects that the magistrate judge's finding is not supported by the administrative record. This court agrees with plaintiff. Whether Kerry would have regressed had she not been withdrawn from school cannot be determined based on this record. Indeed, prior to the withdrawal from school, Kerry had grabbed in anger at her new teacher and abused herself by head-banging. These incidents involving violence required her to be physically restrained. The hearing officer called these "unexpected and serious behavioral issues."
In light of plaintiff's unexpected regression at the start of the school year, she succeeded in obtaining an order that Kerry's supervisory team meet to consider new IEP options, including the option, which was sought by plaintiff at the hearing, of residential placement. Even if the team had not decided to move Kerry to a residential institution, the team would have been required, in light of the hearing decision, to alter her IEP to permit physical restraints. Under the merits test, the order that the team meet thus modified the legal relationship between the parties. Cf. Phelan, 8 F.3d at 374-75 (plaintiff deemed prevailing party where hearing officer ordered school system to implement a new IEP, and to consider as option the behavioral device sought by plaintiff at the hearing). Under the catalyst test, plaintiff has demonstrated a causal connection between the litigation and the relief sought, and the success was obtained not as a result a *190 gratuitous gesture by the school. This court therefore concludes that plaintiff should be awarded fees as a prevailing party for this hearing.
D. Relief
"[T]he extent of a plaintiff's success [for purposes of a statute authorizing fee-shifting] is a practical question, involving a qualitative, as well as a quantitative, judgment." Aubin v. Fudala, 782 F.2d 287, 290 (1st Cir.1986) (citing cases). "There is no precise rule or formula for making these determinations. The district court may attempt to identify specific hours that should be eliminated, or it may simply reduce the award to account for the limited success." Hensley v. Eckerhart, 461 U.S. 424, 436-37, 103 S. Ct. 1933, 1941, 76 L. Ed. 2d 40 (1983) (emphasis added). Thus, a plaintiff may be entitled not only to fees for time spent on his winning claim, but also for time spent on claims that involve a "common core of facts" or "related legal theories." Id., 461 U.S. at 435, 103 S.Ct. at 1940. District courts are accorded broad discretion in fee-setting matters. Segal v. Gilbert Color Systems, Inc., 746 F.2d 78, 86 (1st Cir.1984) (citing cases).
In this case, the court has been provided with a thorough, reasonable breakdown of the plaintiff's legal expenses. Defendant does not contest the hourly rate or the number of hours expended. Based upon the extremely limited degree of success obtained as a result of the first hearing, this court awards plaintiff 10% of expenditures incurred for bringing the first appeal ($16,262.50 × .10 = $1,626.25). Compare Pearson v. Fair, 980 F.2d 37, 46 (1st Cir.1992) (recognizing that there are cases which do not require a line-by-line explanation of the conclusion that the attorneys' fees must be reduced, court awarded only fifteen percent of total award claimed to reflect limited success).
As the second hearing was a substantial factor in obtaining the requested relief a residential placement I award the full amount of $15,318.75. Although plaintiff did not obtain her requested relief of an emergency interim placement in a residential facility, the hearing officer ordered an emergency team evaluation of plaintiff's appropriate educational placement based on the evidence presented at the hearing that plaintiff's condition had deteriorated to the degree that a modified IEP might be necessary. While the defendant school district was fully exonerated on the charge of physical abuse, nonetheless the hearing resulted in the long sought after residential placement.
With respect to the legal services rendered in this federal court litigation, unfortunately plaintiff's counsel has aggregated the "legal services rendered in post-adjudicatory period for compliance/implementation issues and federal court litigation, between January 7, 1992 and January 2, 1993 (Exhibit 12)." I conclude that all court litigation fees expended prior to October 23, 1992 (the second decision) were expended in connection with the first hearing, and I will award only ten percent of those fees or $370.00 ($3697.50 × .10). However, with respect to all attorney fees incurred after October 23, 1992, as the issues involving the two hearings were intertwined, the Court will award the full amount, $5,385.79.
ORDER
For the foregoing reasons, plaintiff's application for attorneys' fees (Docket # 1) is granted in part. Judgment is awarded in the amount of $22,700.79. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603985/ | 354 N.W.2d 402 (1984)
STATE of Minnesota, Respondent,
v.
Gordon FRATZKE, Appellant.
No. C6-83-17.
Supreme Court of Minnesota.
August 17, 1984.
*404 C. Paul Jones, Public Defender, Susan K. Maki, Asst. Public Defender, Minneapolis, for appellant.
Hubert H. Humphrey, III, Atty. Gen., Janet A. Newberg, Sp. Asst. Atty. Gen., St. Paul, James A. Lavoie, Mille Lacs County Atty., Milaca, for respondent.
Considered and decided by the court en banc without oral argument.
YETKA, Justice.
Defendant was tried and found guilty of first-degree murder and aggravated robbery in Mille Lacs County District Court. He was sentenced on the murder charge to life imprisonment. We affirm.
The only genuine issue at the trial was whether defendant was capable of acting with intent when he killed the victim. The defendant admitted at trial that he killed Hjalmer Westberg, and defense counsel conceded that the prosecution had proved every element of its case except intent. The defense strategy was to prove that defendant was too intoxicated on the night of February 17, 1982, to act with intent. Because of that defense, a rather detailed statement of the facts is necessary.
Defendant Gordon Fratzke was 27 years old on February 17, 1982. He testified that he started drinking alcohol at age 16 and that he had abused alcohol and other drugs continuously since that time. Defendant was put under 72-hour custody at alcohol detoxification facilities approximately ten times between 1974 and 1977 and was committed by the court to extended treatment programs on at least six occasions. He was involuntarily discharged from the Army because of alcohol and drug abuse.
February 17, 1982, was the day of the killing. On that date, defendant was living with Jeff Lucking in Foley, Minnesota. Sometime after noon, defendant and Lucking decided to drive to Mora in Lucking's pick-up truck to cut some wood. Before leaving Foley, defendant purchased an 8-pack of 8-ounce bottles of beer, which defendant and Lucking drank in the truck. On the way to Mora, they stopped and purchased another 6- or 12-pack of beer, which they also drank in the truck.
As the two men drove towards Mora, they passed Hjalmer Westberg's trailer home on Mille Lacs County Road 24. They noticed a junked automobile in the driveway and stopped to ask whether it was for sale. Defendant knocked on the door of the trailer, but no one answered. He and Lucking then noticed some firewood stacked outside the trailer and decided to steal some of it. They loaded the pick-up truck with wood and drove off.
Their next stop was the Beach Side Bar at Ann Lake. They tried unsuccessfully to *405 sell the stolen wood to the bartender and each drank two beers. Defendant then purchased a 12-pack of beer and they left the bar to go and visit Dean Moen, a friend of defendant's. Dean was not home so defendant and Lucking visited with Mrs. Moen and all three drank some beer out of the 12-pack. When Dean returned, they gave him a beer too. Then they sold the wood to him for $10 and left. Moen testified that he heard defendant state, "Boy, am I drunk." However, both Moen and Lucking testified that defendant did not appear to be intoxicated at that time.
After leaving the Moens, defendant and Lucking drove to Mora to visit Lucking's father. On the way to Mora, they smoked approximately three marijuana cigarettes. They stayed with Lucking's father for 15-20 minutes and shared one of their beers with him. They then went to see Lucking's brother Richard for a short time. After leaving Richard's house, they headed back to Foley.
On the way back to Foley, they again passed Hjalmer Westberg's residence. The lights were on in the trailer so they decided to stop and ask about the junked automobile. Westberg invited them in and asked them who they were and what they wanted. Defendant lied to Westberg about his residence, stating that he lived in Garrison. He actually resided in Foley, about 30 miles south of Garrison. The three men agreed on a price for the automobile and then Lucking asked Westberg if he would sell them $5 worth of firewood. Westberg agreed to do so, and they went outside to load the wood into Lucking's truck. Westberg indicated how much wood they could take, and Lucking and defendant loaded the wood.
After the wood was loaded, Lucking started counting out $5 to pay Westberg. He heard a "klunk" sound and looked up to see Westberg throw up his hands and fall to the ground. Defendant was standing behind Westberg, holding a piece of firewood in both hands, "holding it like a club or bat." Lucking shouted, "Gordon, what the hell did you do that for?" The defendant told Lucking to shut up and not to mention his (defendant's) name. Defendant started loading the rest of the woodpile into Lucking's truck. Lucking was looking at Westberg and defendant said to him, "Don't just sit there, G____ d______ it. Start loading the f______ing wood." Lucking picked up a piece of wood and threw it into the truck. Defendant walked over to Westberg and started kicking him in the head. Lucking testified that defendant kicked Westberg four or five times "about as hard as you can kick." The force of the kicks was so great that it caused Westberg's whole body to move. Lucking shouted at defendant to stop, and he did. Defendant went back to loading wood. Lucking got into the truck and shouted, "I'm getting out of here." He saw defendant going through Westberg's pockets, then dragging him around behind the remains of the woodpile. After Westberg was behind the woodpile, Lucking saw defendant's head and back moving up and down as if he were hitting Westberg with his fists or pounding his head against the ground. Lucking started to drive away, and defendant ran and jumped into the truck.
According to Lucking's testimony, defendant was not exhibiting signs of obvious intoxication while they were at Westberg's property. He carried and loaded the wood without stumbling, although he did accidentally hit Lucking with one piece that he had thrown into the truck. He did not slip on the snow-covered ground and he was not staggering. Defendant did not deny any part of Lucking's testimony; his testimony was simply that he could not remember much of what had happened on the night of February 17. However, he did state that he remembered seeing Westberg lying on the ground and that he believes he did hit Westberg. In addition, he admitted under cross-examination that he killed Westberg.
As Lucking drove away, defendant started to pound on the dashboard of the truck and shout, "I'm a killer" or "I'm a killer again." He stated that Lucking was an "accessory to the fact." Defendant then *406 opened Westberg's wallet and divided the $14-$18 it contained with Lucking. When Lucking said that defendant had killed a person for $18 and some firewood, defendant responded, "Well, maybe he's better off dead. That way he can't say nothing." Defendant seemed to be thinking coherently as they drove away from the scene. He told Lucking to slow down because he was driving too fast. He noticed Westberg's driver's license and stated that he knew Westberg from a treatment program both had attended at Moose Lake State Hospital. He suggested that they return to Richard Lucking's house and try to sell him the wood. Finally, he made a point of instructing Lucking not to tell anyone about the crime so they would not be caught.
Richard Lucking testified that defendant and Jeff Lucking arrived at his house at about 9:00 p.m. and offered to sell him the wood. Richard wanted to see how "green" the wood was so they split a few pieces up to burn in Richard's stove. Defendant was able to handle a heavy splitting maul without incident. Richard testified that he knew defendant had been drinking by the smell on his breath, but defendant was not stumbling and was able to converse coherently without wandering off the subject of conversation. Richard also stated that Jeff related the story of the killing to him in private. The details did not differ from Jeff's version at the trial.
Hjalmer Westberg was 73 years old on the night he was killed. An autopsy revealed that his skull had been fractured in three places across the back and at each temple. The medical examiner testified that the fractures were caused by multiple blows to the head. The force of the blows was sufficient to break several bone fragments loose and to flatten out the right side of Westberg's face.
Defendant was apprehended because Jeff Lucking turned himself in to the police and revealed defendant's role in the killing.
Defendant raises these issues on appeal:
1. Did the trial court err in denying a change of venue and refusing to record the voir dire examination of the jury?
2. Was the evidence sufficient to support the jury's finding that defendant had the capacity to act with intent when he killed Westberg?
3. Did the trial court err in excluding the opinion of an expert witness on defendant's capacity to "plan anything" on February 17?
4. Did the trial court err in admitting testimony concerning defendant's confession to an earlier murder?
5. Did the trial court err in refusing to instruct on third-degree murder?
6. Was defendant convicted of aggravated robbery in addition to first-degree murder?
1. The district court file contains 11 articles relating to this crime, published in local newspapers between approximately February 25, 1982, and July 28, 1982. On October 13, 1982, defense counsel moved for a change of venue, apparently on the basis of adverse newspaper publicity. The motion was denied by an order dated October 13, 1982. The order was issued without an accompanying memorandum.
Defendant now claims that the court's refusal to change venue violated his right to a fair trial. This court has stated that trial courts have wide discretion in deciding motions for change of venue. The trial court's decision will not be reversed "unless there has been a clear abuse of discretion." State v. Salas, 306 N.W.2d 832, 835 (Minn.1981) (quoting State v. Gilbert, 268 N.W.2d 576, 581 (Minn.1978)). The fact that a case generates widespread publicity does not require a trial court to grant a change of venue. What matters is whether the publicity is of a type that is prejudicial to the defendant and whether it affects the minds of the specific jurors involved in the case. Id. at 836.
Of the 11 newspaper articles related to this case, three do not mention defendant's name at all. Five more are concerned with the prosecutor's appeal from an unfavorable pretrial order and only mention defendant's *407 name as an indicted party. Thus, only three articles contain material that could be considered prejudicial. Two of these report on defendant's and Lucking's arrest and quote from a deposition filed by the county sheriff in support of the complaint. They relate Lucking's accusations against defendant, including Lucking's statements that defendant hit Westberg on the head with a piece of firewood and kicked him in the head. The third article reports on the two suspects' indictment and quotes from the indictment that defendant "caused Westberg's death."
The articles are not the type that would require the trial court to grant a change of venue. In State v. Salas, supra, this court indicated that publicity would be prejudicial if it quoted public officials' opinions concerning the defendant's guilt. 306 N.W.2d at 835. See also State v. Thompson, 266 Minn. 385, 123 N.W.2d 378 (1963): "The vice of the publicity given this case is not in printing or disseminating factual news but in printing and broadcasting what purports to be the opinions of people who are supposed to know the facts." Id. at 388, 123 N.W.2d at 381. The most damaging statements in the newspaper reports were all clearly ascribed to Lucking, who was identified as a co-defendant charged with the same crimes as defendant. Since no public officials were quoted, this publicity did not require a change of venue. The quote from the indictment cannot be considered prejudicial because it was a purely factual report. See State v. Swain, 269 N.W.2d 707, 720 (Minn.1978). It is also significant that these three reports were published over 7 months before the trial. This court has recognized the lapse of time as a factor in evaluating the prejudicial effect of pretrial publicity. See State v. Hogan, 297 Minn. 430, 437, 212 N.W.2d 664, 669 (1973) (3-month interval); State v. Swain, 269 N.W.2d 707, 720 (Minn.1978) (6-month interval). For these reasons, the trial court did not abuse its discretion in denying defendant's motion.
Defendant argues that the court's refusal to record the voir dire examination entitles him to a new trial. Defendant's argument is based on the premise that any irregularities in the voir dire would be concealed by the lack of a record. However, after voir dire in this case was completed, defendant's attorney was given a specific opportunity to make a record of his objections to any of the jurors. He did not make one comment. Therefore, defendant's argument requires the court to act on the basis of pure speculation. We decline to do so.
2. The only sufficiency of evidence question in this case concerns the finding that defendant had the capacity to act with intent. If defendant had capacity, the finding that he actually acted with intent to kill is justified by the manner in which Westberg was killed. Multiple blows were delivered with great force to very vulnerable parts of Westberg's body, for example, both "temple" areas of his skull. This court has stated that "the length and severe brutality" of a beating are sufficient to prove intent as an element of first-degree murder. State v. Walker, 306 Minn. 105, 120, 235 N.W.2d 810, 820 (1975).
Defendant argues that the evidence of capacity is inadequate as a matter of law because it is based solely on the uncorroborated testimony of an accomplice. This is simply wrong; the record contains several items of evidence that tend to corroborate Jeff Lucking's testimony. Defendant and Lucking visited Lucking's brother Richard shortly after the killing. Richard testified that defendant was able to handle a maul and split firewood and that defendant did not stumble as he walked. Defendant's mental condition was also described he was able to stay on the topic of conversation without wandering and he was not confused. Dean Moen saw defendant before the killing, and he testified that defendant did not appear to be intoxicated. Finally, there was evidence that defendant had been capable of drinking two quarts of vodka per day in July or August of 1981. Defendant's expert acknowledged that this was far in excess of the amount of alcohol defendant consumed on February 17, 1982. *408 This court has indicated before that past history of alcohol consumption is relevant to the defense of intoxication. State v. Marsyla, 269 N.W.2d 2, 5 (Minn.1978) (defendant had a blood alcohol content of .20% at the time he killed three people. Fact that he had previously been apprehended while driving with .37% concentration supported a finding that he had capacity to act with intent at the time of the killing).[1]
Since there is other evidence indicating that defendant was capable of acting with intent, Lucking's testimony may be considered. It indicates that defendant was sufficiently clear-headed on the night of February 17 to attempt to conceal his identity: he lied to Westberg about his residence and told Lucking not to mention his name after he first struck Westberg. Defendant acted purposefully after he killed Westberg by loading the rest of the wood into the truck and going through Westberg's pockets to find his wallet. It was defendant's idea to sell the wood to Lucking's brother. Finally, defendant was capable of foresight and took steps to conceal the crime. He dragged the body to a hiding place and warned Lucking not to tell anyone about the killing. He stated that it was better for Westberg to be dead because that way he could not report the crime.
The question of whether defendant was too intoxicated to form an intent is one for the jury to answer. Bangert v. State, 282 N.W.2d 540, 545 (Minn.1979). If there is sufficient evidence to support the jury's conclusion on the intoxication issue, that conclusion will stand despite the existence of some contrary evidence. State v. Wahlberg, 296 N.W.2d 408, 416 (Minn.1980). The evidence in this case was adequate to support the verdict.
3. Defendant called Dr. Randawl Lakosky as an expert witness. Dr. Lakosky is a psychiatrist with a great deal of experience treating chemically dependent patients. Lakosky expressed his opinion that defendant was intoxicated on the night of the crime and that defendant was not fully able to exercise good judgment or self-control because of his long history of alcohol abuse. Defendant's counsel then asked Lakosky if he had "an opinion as to whether [defendant] could have planned or was planning anything" on the evening of February 17. The prosecutor's objection on the basis of relevance was sustained. Defendant's counsel did not make an offer of proof and closed the direct examination without further questions.
Defendant's failure to make an offer of proof precludes him from claiming error on this issue. Minn.R.Evid. 103(a)(2) (1982). However, had there been an offer of proof, we would still sustain the trial court's ruling.
In State v. Bouwman, 328 N.W.2d 703 (Minn.1982), defendant was charged with first-degree murder. The state asked the trial court to prohibit the defendant from examining his expert psychiatric witnesses on the issues of intent and premeditation. The court denied the state's motion, but certified the following question to this court:
May the court admit, at the trial of a defendant charged with murder in the first degree, expert psychiatric opinion testimony (not offered to establish a defense under Minn.Stat. § 611.026) that the defendant, at the time of the alleged crime, lacked the mental capacity to premeditate the killings or to form the specific intent to kill?
*409 Id. at 704-05. This court answered the certified question "in the negative." It held that intent is primarily a question of fact for the jury to decide on the basis of their experiences in life and common sense. Expert testimony on capacity could only be admitted when a defendant raised the insanity defense.
Thus, Bouwman is dispositive in this case. It might be argued that this case is distinguishable because the defendant in Bouwman did not claim that his capacity was reduced because of intoxication. The average juror has some experience with intoxication and is presumably able to consider the effect of alcohol consumption on the ability to act with intent. Mental illness is a specialized field where expert knowledge and experience are required. Therefore, it is within the court's discretion to admit expert testimony regarding the effect of insanity on mental capacity in phase II of a bifurcated trial. The exclusion of this evidence was not reversible error. See State v. Bouwman, 354 N.W.2d 1 (1984).
4. Jeff Lucking testified that, as he and defendant were driving away from the scene of Westberg's death, defendant admitted to another killing on an earlier date. Lucking testified that defendant said, "Don't worry about it. They never caught me for the last one seven years ago." Defendant's attorney immediately asked for a conference at the bench, and it is obvious that he objected at that time on the basis of relevance and undue prejudice.
The statement showed defendant's capacity to act intentionally. It demonstrates that he was thinking clearly immediately after the killing, aware of the gravity of his act and its potential consequences. Given the broad definition of relevance contained in Minn.R.Evid. 401 (1982), the trial court properly overruled defendant's relevance objection.
Defendant also argued that the probative value of this evidence was outweighed by the possibility that it would unduly prejudice the jury. Minn.R.Evid. 403 (1982). However, we do not need to consider whether the trial court balanced these two factors properly because any error in admitting the evidence was harmless. We have stated that the doctrine of harmless error is applicable to cases where prejudicial evidence was erroneously admitted. State v. Dinneen, 300 Minn. 354, 358-59, 220 N.W.2d 292, 295 (1974); State v. Wofford, 262 Minn. 112, 120, 114 N.W.2d 267, 272 (1962). The standard for establishing harmless error is demanding the error will only be disregarded "if there is no reasonable possibility that the evidence complained of might have contributed to the conviction," or when defendant's guilt was "conclusively proven." State v. Paige, 256 N.W.2d 298, 302 (Minn.1977); State v. Hutchison, 121 Minn. 405, 409, 141 N.W. 483, 484 (1913).
As noted above, the issue in this case was whether defendant was capable of acting with intent when he killed Westberg. There was a great deal of evidence to support the state's argument that he was capable: Jeff Lucking's testimony about statements made after the crime, Moen's testimony about defendant's demeanor before the crime, Richard Lucking's testimony about defendant's demeanor and capacity for physical activity immediately after the crime, and evidence indicating his ability to consume large quantities of alcohol. Defendant was not able to rebut any of this evidence. The only evidence he offered to prove his lack of capacity was the opinion of one expert witness to the effect that he was "intoxicated" on the night of the crime and that his 6-week "dry" period preceding the crime could have reduced his tolerance for alcohol.
In some cases, it is difficult to decide when there is sufficient evidence to prove conclusively that a defendant is guilty, but the evidence in this case is overwhelming. Therefore, defendant is not entitled to a new trial on the basis of the trial court's admission of his confession to an earlier crime.
5. State v. Wahlberg, 296 N.W.2d 408 (Minn.1980), is dispositive of this issue. *410 In Wahlberg, essentially the same facts were presented as exist in this case. Defendant was accused of killing Jeffrey Goedderz. Goedderz died as a result of multiple blows with an ax and a knife, and defendant was intoxicated at the time of the murder. After a jury trial, defendant was convicted of first-degree murder. On appeal, he contended that the trial court erred in refusing to instruct the jury on third-degree murder.
We held that the refusal to instruct was not error. We defined the circumstances where a third-degree murder instruction would be indicated:
This statute was intended to cover cases where the reckless or wanton acts of the accused were committed without special regard to their effect on any particular person or persons; the act must be committed without a special design upon the particular person or persons with whose murder the accused is charged.
Id. at 417 (citations omitted). Applying this test to the facts of the present case, it is clear from the manner of death that defendant's actions were directed towards the person of Hjalmer Westberg. Thus, no third-degree murder instruction was required.
6. Defendant claims that he was convicted of aggravated robbery in addition to first-degree murder. He argues that the robbery conviction must be vacated under Minn.Stat. § 609.04 (1982) which provides that:
Upon prosecution for a crime, the actor may be convicted of either the crime charged or an included offense, but not both. An included offense may be * * *:
(4) A crime necessarily proved if the crime charged were proved * * *.
Defendant was convicted of first-degree murder under the felony-murder section of the statute. The felony at issue was the aggravated robbery of Hjalmer Westberg. Therefore, under section 609.04, defendant cannot be convicted of both aggravated robbery and felony murder because aggravated robbery is an offense "necessarily proved" if the felony-murder charge is proved.
The crux of this issue is the definition of "conviction." The term is not defined in the statute, but it was recently considered by the court. In State v. LaTourelle, 343 N.W.2d 277 (Minn.1984), defendant was convicted on three counts of first-degree murder. He argued that, under section 609.04, only one conviction could be sustained. The court agreed, but it did not require that the other convictions be vacated outright. Instead, it held that only one conviction could be adjudicated. The other two were allowed to stand, but had to remain unadjudicated. LaTourelle defines "conviction" as "adjudicated conviction" for section 609.04 purposes.
An adjudication of conviction is defined in Rule 27.03, subd. 7, Minn.R.Crim.P. (1982): "The sentence or stay of imposition of sentence is an adjudication of guilt." In this case, defendant was only sentenced for first-degree murder. There was no sentence or stay of imposition of sentence on the aggravated robbery charge that charge was never mentioned in the trial court's sentencing order. Since the aggravated robbery conviction was never adjudicated, defendant's argument that it must be vacated is without merit.
The trial court is upheld and the conviction is affirmed.
NOTES
[1] There was evidence that defendant did not drink alcohol between late December 1981 and mid-February 1982. Defendant's expert testified that this "dry" period immediately before February 17 could have reduced his ability to drink large amounts of alcohol. However, the expert never offered an opinion about how much defendant's tolerance would be decreased; his testimony was in very general terms. This court is required to review the evidence "in the light most favorable to the state." State v. Thompson, 273 Minn. 1, 36, 139 N.W.2d 490, 515, cert. denied, 385 U.S. 817, 87 S. Ct. 39, 17 L. Ed. 2d 56 (1966). Therefore, the evidence of defendant's drinking capacity corroborates Jeff Lucking's testimony that defendant was able to act with intent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2522797/ | 109 F. Supp. 2d 834 (2000)
Gary BOGGS, Plaintiff,
v.
UNITED STATES of America, Defendant.
No. C-1-99-51.
United States District Court, S.D. Ohio, Western Division.
June 20, 2000.
*835 Gary L Boggs, Loveland, OH, plaintiff pro se.
Lydia D Bottome, Todd L Treadway, U.S. Department of Justice, Tax Division, Washington, DC, for USA, Internal Revenue Service, defendants.
ORDER
HERMAN J. WEBER, District Judge.
This matter is before the Court upon the Report and Recommendation of the United States Magistrate Judge (doc. no. 14) to which neither party has objected.
Upon a de novo review of the record, the Court finds that the Judge has accurately set forth the applicable law and has properly applied it to the particular facts of this case. Accordingly, in the absence of any objection by plaintiff, this Court accepts the Report as uncontroverted.
The Report and Recommendation of the United States Magistrate Judge (doc. no. 14) is hereby ADOPTED AND INCORPORATED BY REFERENCE HEREIN. The Motion for Summary Judgment filed by the defendant, United States of America (doc. no. 10), is GRANTED. Plaintiff's Complaint is DISMISSED. This matter is TERMINATED on the docket of this Court.
IT IS SO ORDERED.
REPORT AND RECOMMENDATION THAT THE GOVERNMENT'S MOTION FOR SUMMARY JUDGMENT (DOC. 10) BE GRANTED, AND THIS CASE THEREFORE TERMINATED UPON THE DOCKET
SHERMAN, United States Magistrate Judge.
NOTICE TO THE PARTIES REGARDING THE FILING OF OBJECTIONS TO THIS R & R
This is a civil tax action initially filed pro se by taxpayer Gary Boggs against the United States ("Government"). In his complaint, plaintiff seeks an injunction to (1) enjoin the Internal Revenue Service ("IRS") from continuing its efforts to collect plaintiff's back federal taxes for 1995-96; (2) require the IRS to release a lien it supposedly placed upon plaintiff's Clermont County, Ohio property; and (3) direct the IRS to also release a "notice of levy" served upon plaintiff's employer, Makino, Inc. See doc. 1 (pro se complaint) at 1. Believing the Court lacks jurisdiction to enter such an injunction, the Government now moves for summary judgment. See docs. 10 (motion), 12 (plaintiff's opposition memorandum).
I.
A motion for summary judgment should be granted if the evidence submitted to the Court demonstrates that there is no genuine issue as to any material fact, and that the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). See Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). The Court must read the evidence, and all inferences drawn therefrom, in the *836 light most favorable to the non-moving party. Smith v. Hudson, 600 F.2d 60, 63 (6th Cir.1979). "[S]ummary judgment will not lie if the dispute about a material fact is `genuine,' that is, if the evidence is such that a reasonable jury could return a verdict for the non-moving party." Anderson, 477 U.S. at 248, 106 S. Ct. 2505. The Court's function is not to weigh the evidence and determine the truth of the matters asserted, "but to determine whether there is a genuine issue for trial." Id. at 249, 106 S. Ct. 2505. The relevant inquiry is "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Id. at 251-52, 106 S. Ct. 2505.
II.
The motion is well taken. Plaintiff's claim for injunctive relief is barred by both the Anti-Injunction Act, 26 U.S.C. § 7421(a), and the Declaratory Judgment Act, 28 U.S.C. § 2201(a). As one Court of Appeals has explained:
The Declaratory Judgment Act authorizes federal courts to grant declaratory relief in cases of actual controversy within its jurisdiction, but expressly precludes granting such relief in cases "with respect to federal taxes." 28 U.S.C. § 2201(a). This prohibition is "designed to protect `the Government's need to assess and collect taxes as expeditiously as possible with a minimum of pre-enforcement judicial interference.'" Nelson v. Regan [84-1 USTC ¶ 9306], 731 F.2d 105, 109 (2d Cir.1984) (quoting Bob Jones University v. Simon [74-1 USTC ¶ 9438], 416 U.S. 725, 736[, 94 S. Ct. 2038, 40 L. Ed. 2d 496] (1974)), cert. denied sub. nom., Manning v. Nelson, 469 U.S. 853, 105 S. Ct. 175, 83 L. Ed. 2d 110 (1984). The statute makes clear that Congress intended to bar federal courts from granting declaratory relief in cases challenging the IRS's method of collecting and assessing federal taxes. Nelson [84-1 USTC ¶ 9306], 731 F.2d at 109; Jolles Foundation v. Moysey [58-1 USTC ¶ 9122], 250 F.2d 166, 169 (2d Cir.1957). The exception for tax matters is very broad, see Martin v. Andrews [56-2 USTC ¶ 10,072], 238 F.2d 552 (9th Cir.1956), and applies regardless of a recitation of alleged constitutional violations. Willis v. Alexander [78-2 USTC ¶ 9525], 575 F.2d 495, 495-96 (5th Cir.1978); Jolles [58-1 USTC ¶ 9122], 250 F.2d at 169.
As for [plaintiff's] claim for injunctive relief, the district court likewise correctly determined that it lacked jurisdiction to grant it. The Anti-Injunction Act states that "[n]o suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person...." 26 U.S.C. § 7421(a). None of the possible exceptions to this provision apply, in particular the exception defined by the Supreme Court in Enochs v. Williams Packing & Navigation Co. [62-2 USTC ¶ 9545], 370 U.S. 1, 7[, 82 S. Ct. 1125, 8 L. Ed. 2d 292] (1962), which allows suits to go forward where (i) the government's position has no chance of success on the merits, and (ii) equity jurisdiction otherwise exists. See also Bob Jones University [74-1 USTC ¶ 9438], 416 U.S. at 745[, 94 S. Ct. 2038].
Tien v. Goldenberg, No. 96-6100, 1996 WL 751371, at *1 (2d Cir. Oct.31, 1996). Other circuits have also so held. See Wyoming Trucking Ass'n, Inc. v. Bentsen, 82 F.3d 930, 932-33 (10th Cir.1996); Progressive Consumers Fed. Credit Union v. United States, 79 F.3d 1228, 1233 (1st Cir.1996). The Sixth Circuit, likewise, is in accord with this view. See Lutz v. United States, No. 90-5226, 1990 WL 193066, at *2 (6th Cir. Dec.6, 1990) (per curiam); Gleason v. Fahey, No. 90-5066, 1990 WL 143597, at *1 (6th Cir. Oct.2, 1990); Ecclesiastical Order of the ISM of AM, Inc. v. IRS, 725 F.2d 398, 400-01 (6th Cir.1984); Dickens v. United States, 671 F.2d 969, 972 (6th Cir.1982).
*837 Plaintiff's request for injunctive relief is thus barred by the above caselaw. The Williams Packing exceptions to the Anti-Injunction Act, described in Tien, are inapplicable here because plaintiff has available to him the option of filing a "claim for a tax refund or credit" under 26 U.S.C. § 7422(a). See Hezel v. United States, No. 97-6046, 1998 WL 702311, at *1 (6th Cir. Sept.21, 1998); see also Wyoming Trucking Ass'n, 82 F.3d at 935 ("The fact ... that ... plaintiffs have an adequate remedy at law via a tax [refund action] filed in accordance with [IRS] procedures ... prevents equity jurisdiction in this case").
III.
The Court therefore RECOMMENDS that the Government's motion for summary judgment be GRANTED, and this case TERMINATED UPON THE DOCKET.
May 1, 2000.
NOTICE
Pursuant to Fed.R.Civ.P. 72(b), any party may serve and file specific, written objections to this Report & Recommendation ("R & R") within TEN DAYS of their service of this R & R. That period may be extended further by the Court on timely motion by either side for an extension of time. All objections shall specify the portion(s) of the R & R objected to, and shall be accompanied by a memorandum of law in support of the objections. A party shall respond to an opponent's objections within TEN DAYS after being served with a copy of those objections. Failure to make objections in accordance with this procedure may forfeit rights on appeal. See Thomas v. Arn, 474 U.S. 140, 106 S. Ct. 466, 88 L. Ed. 2d 435 (1985); United States v. Walters, 638 F.2d 947 (6th Cir.1981). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603920/ | 8 So.3d 126 (2009)
Rodney R. DUHON, Sr.
v.
The LAKE CHARLES ELECTRICAL JOINT APPRENTICE, et al.
No. CA 08-1106.
Court of Appeal of Louisiana, Third Circuit.
March 4, 2009.
Edward J. Fonti, Jones, Tete, Fonti, & Belfour, L.L.P, Lake Charles, LA, for Plaintiff/Appellant, Rodney R. Duhon, Sr.
Louis L. Robein, Jr., Robein, Urann, Spencer, Picard & Cangemi, Metairie, LA, Kenneth Michael Wright, Lake Charles, LA, for Defendant/Appellee, the Lake Charles Electrical Joint Apprentice & Training Committee.
Court composed of MARC T. AMY, BILLY HOWARD EZELL, and JAMES T. GENOVESE, Judges.
EZELL, Judge.
Rodney Duhon appeals the trial court's granting of a summary judgment in favor of the Lake Charles Joint Apprenticeship and Training Committee (the JATC). For the following reasons, we affirm the decision of the trial court.
The JATC operates a training program in which apprentice electricians receive a combination of on-the-job training and classroom instruction in electrical work. The program is a joint venture between the National Electrical Contractor Association (contractors) and the International Brotherhood of Electrical Workers (IBEW). The National JATC (the *127 NJATC) sets the standards to which the local programs are to comply. Under those standards, an apprentice is to complete five years and 8,000 hours of training to be certified as a journeyman electrician.
The JATC is governed by a joint committee of three contractors and three members of the IBEW. Prior to his termination, Mr. Duhon served under the JATC board as Apprenticeship Coordinator and Director. He was responsible for the dayto-day business of the training program.
On June 7, 2006, the JATC met and voted four to two to terminate Mr. Duhon's employment contract. Mr. Duhon sued, claiming he was terminated without cause, in violation of the terms of his employment contract. The JATC filed a motion for summary judgment, claiming there were no genuine issues of material fact and that Mr. Duhon had been fired for just cause. The motion for summary judgment was granted by the trial court, dismissing Mr. Duhon's claims. From that decision, Mr. Duhon appeals.
Mr. Duhon asserts one assignment of error on appeal, that the trial court erred in ruling that cause existed for his termination.
When an appellate court reviews a trial court judgment on a motion for summary judgment, it applies the de novo standard of review "using the same criteria that govern the trial court's consideration of whether summary judgment is appropriate, i.e., whether there is a genuine issue of material fact and whether the mover is entitled to judgment as a matter of law." Supreme Serv. & Specialty Co., Inc. v. Sonny Greer, Inc., 06-1827, p. 4 (La.5/22/07), 958 So.2d 634, 638. The motion should be granted only "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to material fact, and that mover is entitled to judgment as a matter of law." La.Code Civ.P. art. 966(B).
In reviewing this judgment, we must apply the burden of proof imposed upon a movant in a motion for summary judgment, which is set forth as follows in La. Code Civ.P. art. 966(C)(2):
The burden of proof remains with the movant. However, if the movant will not bear the burden of proof at trial on the matter that is before the court on the motion for summary judgment, the movant's burden on the motion does not require him to negate all essential elements of the adverse party's claim, action, or defense, but rather to point out to the court that there is an absence of factual support for one or more elements essential to the adverse party's claim, action, or defense. Thereafter, if the adverse party fails to produce factual support sufficient to establish that he will be able to satisfy his evidentiary burden of proof at trial, there is no genuine issue of material fact.
Mr. Duhon's contract stated that disciplinary action taken against him would be subject to a "just cause" standard. "The Louisiana Civil Code explains that `cause' is synonymous with `reason.'" Voitier v. Church Point Wholesale Beverage Co., Inc., 99-1777, p. 9 (La.App. 3 Cir. 4/5/00), 760 So.2d 451, 458, writ denied, 00-1920 (La.9/29/00), 770 So.2d 350 (citing La.Civ. Code art.1967 cmt. (a)). Black's Law Dictionary (8th ed.2004), defines just or good cause as "[a] legally sufficient reason." Therefore, it is our task to determine if there is no genuine issue of material fact that Mr. Duhon was fired for a legally sufficient reason.
The JATC provided Mr. Duhon a list of ten reasons for his termination, including failure to attend JATC meetings or training seminars, neglect of duties, failure to *128 maintain proper business hours in his office, improperly awarding hours to apprentices, and failing to implement changes mandated by the NJATC.
Mr. Duhon's main argument is that the trial court relied on the JATC's claim that he was not running a program in line with that mandated by the NJATC while they were the ones who ordered him to go from a five-year to a four-year program. However, we find this argument unconvincing.
While it is true that the JATC board did order the change, the record clearly shows that Mr. Duhon certified false apprentice records to the Louisiana Department of Labor, the NJATC, and the IBEW. These falsifications concerned the number of years apprentices attended the program and the number of hours they worked. Gail Miller, Mr. Duhon's former secretary, stated in her affidavit that Mr. Duhon would have her wait one year after the completion of the four-year program to submit diplomas, so that it would indicate to the Louisiana Department of Labor and the NJATC that the apprentices had completed a five-year program. Her affidavit gave several specific examples of instances of manipulation of hours to benefit specific apprentices even beyond the lying about their having reached the required 8,000 hours needed for journeyman status. This fact is uncontradicted, as Mr. Duhon admits falsifying these documents.
Despite his arguments in brief to the contrary, there is no evidence in the record whatsoever that shows that the board was aware of this behavior. Even if his argument concerning the reduction in the number of years of schooling had merit, nowhere does Mr. Duhon even argue that the board ordered him to change the number of hours required for certification as a journeyman. Thus, there is no genuine issue as to the fact that Mr. Duhon inappropriately certified false information concerning apprentice schooling and hours.
Mr. Duhon attempts to argue that this information was discovered after the firing and could not retroactively constitute just cause under Voitier. We find that argument also to be lacking. Most notably, he refers to the specific example of hour manipulation contained in Gail Miller's affidavit. However, the fact that specific examples were given after the fact in Mrs. Miller's affidavit certainly does not mean that they were not known prior to the termination. Mrs. Miller clearly knew she was filling out false documents at the time he told her to prepare them. Jeff Sanders stated that while he was assistant business manager to the IBEW, prior to the termination, he knew of one apprentice who miraculously rose from a one-year helper to a four-year (at best) journeyman a scant one year later. Although he stated that he could not name one specific person off the top of his head during his deposition, Tink Reeves stated that he knew of instances where Mr. Duhon had manipulated hours for an apprentice. Further, the record contains uncontradicted testimony that the practice was generally known throughout the IBEW. It is clear that Mr. Duhon's behavior was well known prior to his termination. This argument is without merit.
Additionally, the record is also clear that Mr. Duhon did fail to attend the JATC seminars and training courses and that his office hours were unusual, to be generous. It is clear from the record that the JATC had ample just cause to terminate Mr. Duhon's contract and that there is no genuine issue of material fact pertaining to that matter.
Finally, the JATC answers Mr. Duhon's appeal, seeking attorney fees for work done on appeal and claiming that the appeal is frivolous and brought solely for *129 the purpose of delay. We find no frivolity in the appeal and, therefore, deny the JATC's answer to it.
For the above reasons, the decision of the trial court is hereby affirmed. Costs of this appeal are assessed against Mr. Duhon.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604018/ | 645 So.2d 685 (1994)
FERRUZZI, U.S.A., INC., et al.,
v.
R.J. TRICON CO., INC., et al.
No. 93-CA-1591.
Court of Appeal of Louisiana, Fourth Circuit.
September 29, 1994.
Rehearing Denied December 13, 1994.
*686 Lawrence J. Ernst, Fred T. Hinrichs, Christovich & Kearney, New Orleans, for *687 plaintiffs-appellants Mississippi River Grain, Inc. and Ranger Ins. Co.
William W. Messersmith, III, Judy L. Burnthorn, Deutsch, Kerrigan & Stiles, New Orleans, for appellant Harbor Const. Co., Inc.
Nelson W. Wagar, III, Hailey, McNamara, Hall, Larmann & Papale, Metairie, for defendant-appellee Essmueller, Inc.
Paul V. Cassisa, Sr., Carl J. Giffin, Jr., Bernard, Cassisa & Elliott, Metairie, for defendant-appellee Browning Mfg. Div. of Emerson Elec. Co.
Edward A. Rodrigue, Jr., Robert I. Baudouin, Boggs, Loehn & Rodrigue, New Orleans, for defendant-appellee R.J. Tricon Co., Inc.
Before KLEES, CIACCIO and ARMSTRONG, JJ.
KLEES, Judge.
Plaintiff Mississippi River Grain, Inc. appeals the trial court's judgment finding no liability on the part of defendants for property damage and lost profits caused by an explosion and fire which erupted at plaintiff's grain elevator on August 16, 1989. We affirm.
Plaintiff brought a products liability claim based on the theory that a defect in the elevator's head pulley assembly caused a spark, which ignited grain dust collected in the silo. The original defendants were R.J. Tricon, the sales engineer for installation of the elevator; Harbor Construction Company ["Harbor"], which actually erected the elevator; Essmueller Company, which designed and manufactured the elevator; and Browning Manufacturing Division of Emerson Electric Company ["Browning"], which manufactured a bushing in the head pulley assembly of the elevator. Both R.J. Tricon and Harbor filed cross claims against Browning for indemnity and contribution. The accident allegedly happened when a pulley within the head drive assembly unit moved along its shaft and came into contact with the casing of the elevator leg, created friction and producing heat.
Prior to trial, the district court granted the motion for summary judgment brought by defendant R.J. Tricon, and dismissed it from the suit. Trial was held October 27-30, 1992, without a jury. At the conclusion of the plaintiff's case, the trial court granted motions for the involuntary dismissal of Browning and Harbor pursuant to Louisiana Code of Civil Procedure article 1672. The trial proceeded with the presentation of evidence by Esmueller, the sole remaining defendant.
On December 30, 1992, the trial court rendered judgment in favor of Essmueller. In extensive written Reasons for Judgment, the trial judge stated that the evidence presented had convinced him unquestionably that the head pulley had moved along its shaft and had come into contact with the housing, triggering the explosion. However, the trial judge ruled in favor of Essmueller because the plaintiff had not met its burden of proving that the movement of the pulley was caused by the fault of Essmueller.
On appeal, plaintiff contends the trial court erred in finding no liability on the part of Essmueller. Additionally, plaintiff argues that the trial court erred in dismissing Browning and Harbor. All three defendants have opposed the appeal and Harbor has also asserted that, in the event its dismissal is reversed, its cross claim against R.J. Tricon should be reinstated. After reviewing the record, we find no manifest error in the judgment of the trial court.
Dismissal of Harbor
The record clearly supports the trial court's involuntary dismissal of Harbor. Harbor was awarded the construction contract to erect the Essmueller bucket elevator at the Mississippi River Grain site. Harbor purchased the elevator from R.J. Tricon, who had ordered it from Essmueller. Harbor received the elevator with its head pulley mechanism fully assembled. It received no instructions regarding the recommended torquing levels or the need to torque or retorque the capscrews in the head pulley. The evidence at trial showed undisputably that *688 torquing was not considered part of Harbor's responsibility. In fact, because the capscrews were completely encased within the pulley mechanism, Harbor could not have checked the torquing levels without completely disassembling the preassembled head pulley component.
As a nonmanufacturer seller, Harbor can have no tort liability for a defective product unless Harbor knew or should have known the product was defective and failed to declare it. Home Insurance Company v. National Tea Company, 577 So.2d 65, 74 (La.App. 1st Cir.1990). Under the law, a nonmanufacturer seller is not required to inspect the product prior to sale to determine the possibility of inherent vices or defects. Id.; Picolo v. Flex-A-Bed, Inc., 466 So.2d 652, 654 (La.App. 5th Cir.1985). Therefore, the trial court correctly held that because the alleged defect in the head pulley was not readily apparent, Harbor as a matter of law could not be found liable for failing to discover it. Harbor's involuntary dismissal was proper.
Dismissal of Browning
Browning is the manufacturer of an allegedly defective bushing which was incorporated into the head pulley assembly of the elevator by Essmueller, the designer and manufacturer of the bucket elevator. Plaintiff alleged that the Browning bushing was defective in its design and manufacture, and also that it was not accompanied by adequate warnings. At the conclusion of the plaintiff's case, counsel for plaintiff conceded that there was no defect in the manufacture of the bushing. Furthermore, when questioned at trial, plaintiff's own experts admitted that the bushing did not have a defective design.
Plaintiff's final claim against Browning was for a failure to warn. Plaintiff introduced into evidence the written instructions/warnings which were provided to Essmueller by Browning. These instructions contain information on the recommended wrench torque, as well as a warning that the bushings and capscrews should be rechecked for proper torquing at least once per week for the first month and periodically thereafter. We find, as did the trial judge, that the instructions/warnings provided by Browning were more than adequate, especially for Essmueller, a sophisticated user. Therefore, the dismissal of Browning was proper.
Dismissal of Essmueller
The trial court's conclusion that Essmueller was not liable for the accident because of plaintiff's failure to prove causation is a factual determination which we will not disturb absent manifest error. Canter v. Koehring, 283 So.2d 716, 724 (La.1973). Plaintiff argues on appeal that this standard does not apply because the trial judge committed a legal error by evaluating the evidence according to an incorrect standard of proof.
We disagree.
Plaintiff's argument is based upon this excerpt from the trial court's Reasons for Judgment:
The Court is presented with only circumstantial evidence that Essmueller's failure to re-torque the capscrews allowed the pulley to move on its shaft, causing this accident. As such, in order to recover, plaintiff's circumstantial evidence must preclude every other reasonable hypothesis as to the cause of the accident.
Citing this passage, plaintiff contends that the trial judge utilized an old, now abandoned standard of proof which required the plaintiff to negate all other possibilities as to the cause of the accident. The correct standard in civil cases was first set forth in Naquin v. Marquette Casualty Company, 153 So.2d 395 (La.1963), and restated by the Court in Boudreaux v. American Insurance Company, 262 La. 721, 264 So.2d 621, 636 (1972), as follows:
Further, as we specifically held in Naquin v. Marquette Casualty Co., 244 La. 569, 153 So.2d 395 (1963), by this burden of proof, the circumstantial evidence requisite in civil negligence cases need not negate all other possible causes of injury, as the opinions of the previous courts seemed to hold. It suffices if the circumstantial proof excludes other reasonable hypotheses only *689 with a fair amount of certainty, so that it be more probably than not that the harm was caused by the tortious conduct of the defendant. 153 So.2d at 396-397.
Although the trial judge in this instance did not quote the Naquin standard fully, his use of the term "reasonable hypothesis" rather than "possibilities" or "possible causes" indicates that he did indeed follow the proper standard. Plaintiff's contention that this standard has been changed by the recent case of Lasha v. Olin Corporation, 625 So.2d 1002 (La.1993) is erroneous. The Lasha Court merely reiterated, citing Naquin, that plaintiff must prove each element of his case, such as causation, by a preponderance of the evidence, which means the fact sought to be proved must be more probable than not. 625 So.2d at 1005.
In reviewing the record, we find that the trial court did not commit manifest error in concluding that the plaintiff had failed to show that the explosion at the grain elevator was more probably than not caused by Essmueller's failure to properly torque and/or re-torque the capscrews in the head pulley. By the testimony of those who examined the elevator immediately following the accident, plaintiff showed that the pulley had moved on its shaft and that the screws were not tightened to the manufacturer's recommended torque of 250 foot lbs., which was the responsibility of Essmueller. In fact, the capscrews on the motorized end of the pulley were torqued at 150 foot lbs. Nevertheless, plaintiff failed to show that this defect caused the accident.
Plaintiff's expert, Mr. Owens, opined that the improperly torqued capscrews had allowed the head pulley and shaft to move laterally and come in contact with the shroud. Mr. Owens believed that this conclusion was obvious. He did admit, however, that manufacturers generally set torque standards utilizing a "margin of error" or "safety factor".
Defendant's expert, Mr. Cooper, established that in this case, Browning had designed the bushing using a safety factor of 2 ½ :1. Mr. Owens admitted that using this figure, the torque of 150 foot lbs., which existed after the accident, should have been sufficient to hold the bushing on the shaft. To test plaintiff's theory of causation, defendant's expert Mr. Cooper performed a test, which was videotaped and introduced into evidence, in which lateral force of varying degrees was applied to an allegedly identical shaft and bushing torqued at only 75 foot lbs. In that test, no lateral movement of the bushing occurred even when a force of 29 tons, the greatest force used in the test, was applied. Although plaintiff contends on appeal that this test was not truly representative of the accident situation, no testimony or evidence was introduced at trial to call into question the test methodology or results.
The trial judge noted on the record, after the presentation of the plaintiff's case, that he was concerned that Mr. Owens did not know how much force would be required to move the pulley on its shaft, and further that Owens hadn't performed any tests or calculations to determine the load on the shaft or the tolerance of the torque level of the bolts. However, at that juncture of the case, the trial judge denied a motion for involuntary dismissal of Essmueller because he needed to see more evidence. The only testimony presented after the trial judge's denial of the motion was that of defendant's expert, Mr. Cooper. The trial court was obviously impressed by Mr. Cooper's testimony, as well as by the evidence supporting it. The plaintiff's failure to present evidence challenging Mr. Cooper's test, coupled with the lack of any specific testing or calculations to support Mr. Owens' opinion, makes it reasonable for the trial judge to have concluded that causation was not proved by a preponderance of the evidence. We therefore find no manifest error in his conclusion.
Accordingly, for the reasons given, we affirm the judgment of the trial court.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1645329/ | 994 So.2d 1108 (2007)
Charlotte JAMES, Appellant,
v.
FLORIDA STATE ORIENTAL MEDICAL ASSOCIATION, INC., Appellee.
No. 3D06-345.
District Court of Appeal of Florida, Third District.
March 7, 2007.
Rehearing Denied April 9, 2008.
Charlotte James, in proper person.
Carlton Fields, and Nancy C. Ciampa, and Sorraya Solages, Miami, for appellee.
Before RAMIREZ, WELLS, and LAGOA, JJ.
PER CURIAM.
Charlotte James appeals the trial court's final judgment entered in favor of Florida State Oriental Medical Association, Inc. James challenges various aspects of the final judgment, referencing the proceedings that took place before the trial court, as well as the trial court's rulings and review of the evidence. However, James has failed to present a transcript of the proceedings in question, thus the record presented to us is inadequate to demonstrate reversible error. Accordingly, we are required to affirm. See Applegate v. Barnett Bank of Tallahassee, 377 So.2d 1150, 1152 (Fla.1979).
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603987/ | 645 So. 2d 565 (1994)
Joanette R. LINDSEY and Robert L. Lindsey, her husband, Appellants,
v.
BILL ARFLIN BONDING AGENCY INC., Barry Zisser, and Eunice Zisser, Appellees.
No. 93-978.
District Court of Appeal of Florida, First District.
November 18, 1994.
*566 Edward S. Mallow and Michael R. McCullough of Michael R. McCullough & Associates, Jacksonville, for appellants.
E.T. Fernandez, III, of Inman & Fernandez, Jacksonville, for appellee Bill Arflin Bonding Agency, Inc.
Lee T. Griffin of Marks, Gray, Conroy & Gibbs, P.A., Jacksonville, for appellees Barry Zisser and Eunice Zisser.
BENTON, Judge.
We reverse a final summary judgment entered in favor of Bill Arflin Bonding Agency, Inc. (Arflin) and Barry and Eunice Zisser, owners of the building in which Arflin operates a Western Union office. As she left this building, the Lindseys' complaint alleges, Mrs. Lindsey slipped, fell and fractured her ankle. It is for a jury to say whether events transpired as alleged and, if so, to assess the extent of the defendants' responsibility, if any, under appropriate instructions.
The complaint alleges negligence in failing to discover and remove a "wet spot" on the landing, and in failing to provide a handrail. On appeal, the Lindseys rely only on the second theory, in urging reversal of summary judgment. On September 22, 1990, the complaint alleges, Joanette Lindsey ascended three steps to enter the building; remained inside the Western Union office for no longer than twenty minutes; then in leaving the building, slipped on a wet spot at the top of the steps and fell, ending up at street level with a broken ankle. Joanette Lindsey claims damages for her injury, and Robert Lindsey claims loss of consortium and companionship.
Facts Regarding Causation In Dispute
In granting the defendants' motions for summary judgment, the trial court found that the absence of handrails did not contribute to Ms. Lindsey's injuries because "the uncontroverted evidence reveals that she broke her ankle at the time she slipped on the liquid substance on the landing, and not while actually on the steps themselves." On this factual basis, the trial court concluded that the absence of handrails was not the legal cause of Mrs. Lindsey's fall or her injuries. Although labelled a "finding of Law," the trial court's determination that the absence of handrails did not contribute to Mrs. Lindsey's fall or injuries was in part the resolution of a central fact in dispute. Viewed in this light, the finding invades the province of the jury.
Summary judgment should be granted only where it is clear that no issues of material fact exist. Craig v. Gate Maritime Properties, 631 So. 2d 375, 377 (Fla. 1st DCA 1994); Hancock v. Department of Corrections, 585 So. 2d 1068 (Fla. 1st DCA 1991), review denied, 598 So. 2d 75 (Fla. 1992). The movant's proof must be conclusive; all reasonable inferences which may be drawn in favor of the opposing party must be overcome. Landers v. Milton, 370 So. 2d 368, 370 (Fla. 1979); Holl v. Talcott, 191 So. 2d 40, 43-44 (Fla. 1966); Craig, 631 So.2d at 377. "[I]f the record raises even the slightest doubt that an issue [of material fact] might exist, summary judgment is improper." Craig, 631 So.2d at 377, citing, Holland v. Verheul, 583 So. 2d 788, 789 (Fla. 2d DCA 1991). Particular *567 caution should be employed when granting summary judgment in negligence actions. Moore v. Morris, 475 So. 2d 666, 668 (Fla. 1985); Johnson v. Deep South Crane Rentals, Inc., 634 So. 2d 1113, 1113-14 (Fla. 1st DCA 1994).
As a whole, testimony Ms. Lindsey gave on deposition indicates that she did not know exactly when her ankle fractured. She testified repeatedly that all she knew was that her ankle was swollen, when, after coming to rest on the sidewalk at the bottom of the steps, she examined her foot. The trial court resolved a question of fact that should have been saved for the jury, in deciding that she broke her ankle on the landing, rather than on a step or on the sidewalk. The jury might reasonably infer that the fracture followed the initial slip.
Legal Duty To Invitee
The summary judgment reflects the trial court's conclusion that the building code of the City of Jacksonville in force when the building was constructed did not require that the defendants' steps or stairs be equipped with handrail(s); and, more broadly, that no common law principle required that the steps be equipped with handrail(s), in order to protect patrons from an unreasonably hazardous condition. In the present posture of the case, affirmance would be appropriate, despite the unwarranted resolution of a factual question, if no jury could consider a lack of handrails in deciding whether the defendants breached their duty of ordinary care.
The owner or occupant of premises owes an invitee the duty of ordinary care in maintaining the premises in a reasonably safe condition; and of giving invitees timely notice of latent perils of which the owner or occupant is in fact or reasonably should be aware. Here no one disputes that the lack of handrails was apparent to all. See Matson v. Tip Top Grocery Co., Inc., 151 Fla. 247, 9 So. 2d 366 (1942). The trial court determined that no appellee had any legal duty to erect handrails at any time prior to Mrs. Lindsey's slip and fall, and that failure to install them was not evidence of a breach of any duty.
Whether, as a general rule, handrail(s) are necessary to make steps or stairs reasonably safe, see generally Atlantic Terrace Co. v. Rosen, 56 So. 2d 444 (Fla. 1952); Ainsworth v. Intercontinental Hotels Corp., 467 So. 2d 386 (Fla. 3d DCA), review dismissed, 475 So. 2d 694 (1985), we need not decide here, because an ordinance addressed the subject at the time the building was constructed. The record contains the pertinent page from the City of Jacksonville's building code then in force, and brief excerpts from national safety codes incorporated by reference into the Jacksonville code at that time.
Effect Of Ordinance
"Violations of statutes [or ordinances], other than those imposing a form of strict liability, may be either negligence per se or evidence of negligence." deJesus v. Seaboard Coast Line Railroad Co., 281 So. 2d 198 (Fla. 1973) (emphasis omitted). Because a "building code is designed to protect the general public rather than a particular class of individuals," Grand Union Co. v. Rocker, 454 So. 2d 14, 16 (Fla. 3d DCA 1984), a violation constitutes evidence of negligence, id.; Liberty Mutual Ins. Co. v. Kimmel, 465 So. 2d 606, 607 (Fla. 3d DCA 1985), but does not establish negligence per se. Morrison Cafeterias Consol., Inc. v. Lee, 215 So. 2d 491 (Fla. 1st DCA 1968); see Groh v. Hasencamp, 407 So. 2d 949 (Fla. 3d DCA 1981), review denied, 415 So. 2d 1360 (Fla. 1982); Schulte v. Gold, 360 So. 2d 428 (Fla. 3d DCA 1978), cert. denied, 368 So. 2d 1367 (Fla. 1979); Richardson v. Fountain, 154 So. 2d 709 (Fla. 3d DCA), cert. denied, 157 So. 2d 818 (Fla. 1963). Violation of a building code "constitute[s] prima facie evidence of negligence." Holland v. Baguette, Inc., 540 So. 2d 197, 198 (Fla. 3d DCA 1989).
A determination that the steps at issue were in compliance with the building code in force at the time of the accident would not foreclose a finding of negligence, if handrail(s) were required at the time the steps were constructed. "[W]hile ... compliance with a statute or ordinance may amount to evidence of reasonableness, such compliance is not tantamount to reasonableness as a matter of law" so as to exclude other relevant *568 evidence. Westland Skating Center, Inc. v. Gus Machado Buick, Inc., 542 So. 2d 959, 964 (Fla. 1989). A jury could find the appellees liable to the Lindseys, even if the current building code does not require handrail(s), if the jury concluded that the lack of handrail(s) amounted to a failure to construct or maintain the steps in a reasonably safe condition. On this question, violation of the ordinance in effect at the time the building was constructed is evidence the jury may consider. See generally Edmonds, Inc. v. Vojka, 332 F.2d 309 (D.C. Cir.1964).
Ordinance Applicable
The affidavit and deposition of Claude Bagwell, Division Chief of Building and Zoning for the City of Jacksonville, to the effect that handrails were not required when the building was erected, because the structure in question constituted "steps," not "stairs," cannot be determinative regarding the meaning of the ordinance. Mr. Bagwell testified on deposition that he applied his personal definition of "stairs" in the permitting process, viz., a structure going "from one story to another story, from one occupied level to another occupied level." Bagwell conceded that his definitions of "stairs" as distinguished from "steps" were not generally accepted by the industry, and that neither term had any definite meaning in the application of building codes.
Expert testimony as to the meaning of an ordinance is not appropriate when the disputed language consists of "ordinary words susceptible to being given plain effect consistent with their ordinary meaning." T.J.R. Holding Co., Inc. v. Alachua County, 617 So. 2d 798, 800 (Fla. 1st DCA 1993). The legal effect of a building code presents a question of law for the court, not a question of fact for the jury. Williams v. State Dep't of Transp., 579 So. 2d 226, 230-31 (Fla. 1st DCA 1991); Edward J. Seibert, A.I.A., Architect and Planner, P.A. v. Bayport Beach and Tennis Club Ass'n, Inc., 573 So. 2d 889 (Fla. 2d DCA 1990). While expert testimony may be relevant and helpful to the court where a statute or ordinance contains words of art or scientific and technical terms, even then such testimony cannot dictate the court's construction of the enactment. T.J.R. Holding Co., 617 So.2d at 799-800.
The terms "stairs" and "steps" were not shown to be terms of art. The trial court was under no obligation to defer to Mr. Bagwell's construction of the ordinance. Id.; Williams v. State Dep't of Transp., 579 So. 2d 226, 231 (Fla. 1st DCA 1991). But see Seibert, 573 So.2d at 892 (trial court should have accepted city's chief building inspector's interpretation of building code as a permissible interpretation of a "statute" by the agency charged with implementing it). The plain language of the standards incorporated in section 900-604.8, which apply to "[e]very flight of stairs having two or more risers," should be given effect.
When the building was constructed in 1974, section 900-604.8 of the City of Jacksonville building code required a handrail on at least one side for stairs less than forty-four inches in width; handrails on both sides for stairs forty-four inches to eighty-eight inches wide; and handrails on both sides and one in the middle for stairs eighty-eight inches or wider. The 1973 American National Standards Institute's safety requirements for floor and wall openings, railings, and toeboards, at that time incorporated by reference into the Jacksonville building code, provided that every flight of stairs having two or more risers be equipped with one or more handrails. When built, these three risers and two treads were required under the code to be equipped with handrails.
Accordingly, we reverse the summary judgment, and remand the case for further proceedings consistent with this opinion.
ZEHMER, C.J., and KAHN, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1603997/ | 8 So. 3d 1135 (2009)
BERRY
v.
STATE.
No. 1D08-5687.
District Court of Appeal of Florida, First District.
May 20, 2009.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604076/ | 8 So. 3d 365 (2009)
WATERS
v.
AGENCY FOR PERSONS WITH DISABILITIES.
No. 2D09-966.
District Court of Appeal of Florida, Second District.
April 24, 2009.
Decision without published opinion. App.dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1604057/ | 130 N.W.2d 573 (1964)
Andrew HELGESON and Agnes C. Helgeson, Plaintiffs and Respondents,
v.
Engvald LOCKEN, Defendant and Appellant.
No. 8157.
Supreme Court of North Dakota.
October 1, 1964.
Rehearing Denied October 22, 1964.
Palda, Palda, Peterson & Anderson, Minot, for appellant.
*574 Joseph P. Stevens, Minot, for respondents.
ERICKSTAD, Judge.
Engvald Locken, as defendant, appeals from the judgment which was rendered on the verdict of the jury in favor of the plaintiffs and from the order denying the motion for judgment notwithstanding the verdict or, in the alternative, for a new trial.
In their complaint the plaintiffs assert two causes of action. For their first cause of action they allege facts in support of their contention that they have suffered damages as a result of the unlawful and improper termination by Mr. Locken of a farm rental agreement. They conclude their first cause of action as follows:
"That by reason of the unlawful and improper termination of the agreement by the defendant, the plaintiffs have been damaged in the sum of $1360.00 for cream they would have been able to sell, and the sum of $1500.00 for the plaintiffs' interest in cattle wrongfully taken from them. That by reason of the aforesaid, and by reason of the provisions of Section 32-03-29 the plaintiffs are entitled to damages in the sum of $8,586.00."
In the second cause of action they allege facts to support their contention that they are entitled to exemplary damages for the manner in which they were evicted from the premises by Mr. Locken on the termination of the contract. They conclude their second cause of action with the following:
"That by reason of the aforesaid, the plaintiffs pray judgment from the defendant for exemplary damages in the sum of Ten Thousand ($10,000.00) Dollars."
To this complaint Mr. Locken filed an answer denying the major allegations of the complaint and asserting a counterclaim for damages allegedly suffered by him.
Both sides submitted testimony to support their allegations, and after each side had rested, the court instructed the jury. The instructions pertinent to the issue on appeal were to the effect that treble damages allowable for forcibly ejecting or excluding a person from the possession of real property are punitive damages.
PUNITIVE DAMAGES FOR EVICTION BY MEANS OF FORCE OF AN UNUSUAL KIND
"`Actual' or `compensatory damages,' the terms being synonymous, are damages in satisfaction of, or in recompense for, the loss or injury or damage actually sustained, and no more. Plaintiffs are entitled to compensatory damages only, unless plaintiffs have clearly proved by a fair preponderance of the evidence that they were wrongfully evicted from the home they were occupying by force of an unusual kind, in which event plaintiffs are entitled to treble damages as punitive damages. `Punitive damages' are penal in their nature and are imposed upon the defendant to punish him and to make an example of him to others as a wrongdoer. A North Dakota statute provides that for forcibly ejecting and excluding a tenant by means of force of an unusual kind from the possession of real property, the measure of damages is three times the compensatory damages, that is to say, three times such a sum as would compensate for the injury, damage, and detriment caused to the tenant by the wrongful eviction. Such statute is highly penal in its character and is subject to strict construction against the tenant and strict construction in favor of the landlord.
"The term `forcibly ejecting and excluding a tenant' means force of an *575 unusual kind which tends to bring about a breach of the peace, such as an injury with a strong arm, or a multitude of people, or in a riotous manner, or with personal violence, or with threat or menace to life or limb, or under circumstances which would naturally inspire fear. So to authorize a recovery of treble damages for a forcible eviction from real property, it is necessary that the entry shall be forcible, but it is not necessary that the force shall be actually applied. It is enough if it is present and threatened, and is justly to be feared. The damages which may be trebled are the actual or compensatory damages sustained by the plaintiffs, and nothing can be trebled but what the jury has found to be the actual, compensatory damages."
In these instructions the court apparently had the provisions of Section 32-03-29, N.D.C.C., in mind:
"32-03-29. Damages for forcible exclusion from realty.For forcibly ejecting or excluding a person from the possession of real property, the measure of damages is three times such a sum as would compensate for the detriment caused to him by the act complained of."
North Dakota Century Code.
In line with the court's thinking that the provisions of said section involved punitive damages, the court submitted to the jury three forms of verdict. The first form was entitled "Verdict for Plaintiffs for Compensatory Damages Only"; the second was entitled "Verdict for Plaintiffs for Treble Damages"; and the third was entitled "Verdict of Dismissal."
No challenge was made to these instructions nor to the jury forms which were made part of the instructions. The jury returned a verdict on the form entitled "Verdict for Plaintiffs for Compensatory Damages Only." The material portion of the verdict read as follows:
"We, the jury, duly impaneled and sworn in the above entitled action, do find in favor of the plaintiffs, Andrew Helgeson and Agnes C. Helgeson, and against the defendant, Engvald Locken, and we do hereby assess plaintiffs' damages in their favor and against the defendant in the total sum of Six Thousand Five Hundred Thirteen and 71/100 Dollars ($6,513.71) and we do further assess defendant Locken's damages against the plaintiffs in the total sum of One Thousand Five Hundred Forty-Eight Dollars ($1,548.00), and subtracting defendant Locken's damages from plaintiffs' damages, we find the difference or balance to be Four Thousand Nine Hundred Sixty-five and 71/100 Dollars ($4,965.71) in which amount we return a verdict for compensatory damages in favor of the plaintiffs and against the defendant."
The material portions of the verdict form entitled "Verdict for Plaintiffs for Treble Damages," which form was not used by the jury, read as follows:
"We, the jury, duly impaneled and sworn in the above entitled action, do find in favor of the plaintiffs, Andrew Helgeson and Agnes C. Helgeson, and against the defendant, Engvald Locken, and do hereby assess plaintiffs' actual or compensatory damages in their favor and against the defendant in the total sum of ____ Dollars ($____), and we do further assess defendant Locken's actual or compensatory damages in his favor and against the plaintiffs in the total sum of ____ Dollars ($____), and subtracting defendant Locken's damages from the plaintiffs' damages, we find the difference and balance to be ____ Dollars ($____) and three times said balance is ____ Dollars ($____), in *576 which treble sum we return a verdict for treble damages in favor of the plaintiffs and against the defendant."
Instructions not objected to are the settled law of the case. Chicago, M., St. P. & P. R. Co. v. Johnston's Fuel Liners, N.D., 122 N.W.2d 140; Montana-Dakota Utilities Co. v. Hoerner, N.D., 81 N.W.2d 648.
As the court in its instructions considered treble damages to be punitive damages and as these instructions were not challenged, they are the settled law of the case and prohibit recovery for treble damages unless punitive damages were found by the jury to be proper. Here the jury returned a verdict for compensatory damages only. The verdict, therefore, can stand only if supported by proof of actual damages. Mr. Locken contends that this verdict could not include items of compensatory damages not pleaded, nor could it exceed the amount of compensatory damages requested in the prayer for relief, unless the pleadings and the prayer for relief were amended to conform to the evidence. No motion was made to amend the pleadings to conform to the evidence, and no such amendment was made.
Contrary to the defendant's views, the pleadings do not limit the amount of the verdict, where the amount is justified by the evidence admitted without objection during the trial of the case.
"RULE 15. AMENDED AND SUPPLEMENTAL PLEADINGS
* * * * * *
"(b) Amendments to conform to the evidence. When issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. Such amendment of the pleadings as may be necessary to cause them to conform to the evidence and to raise these issues may be made upon motion of any party at any time, even after judgment; but failure so to amend does not affect the result of the trial of these issues. * * *"
North Dakota Rules of Civil Procedure.
In regard to the prayer for relief, it has been held that damages may be given in excess of the amount demanded. Couto v. United Fruit Co., 203 F.2d 456 (2d Cir.1953).
It is interesting in this regard to compare the provisions of Rule 8(a) of the North Dakota Rules of Civil Procedure with Section 28-0702 of the North Dakota Revised Code of 1943, which it superseded.
"RULE 8. GENERAL RULES OF PLEADING
"(a) Claims for relief. A pleading which sets forth a claim for relief, whether an original claim, counterclaim, cross-claim, or third-party claim, shall contain (1) a short and plain statement of the claim showing that the pleader is entitled to relief, and (2) a demand for judgment for the relief to which he deems himself entitled. Relief in the alternative or of several different types may be demanded."
* * *
North Dakota Rules of Civil Procedure.
"28-0702. Complaint; What to Contain. The first pleading on the part of the plaintiff is the complaint. The complaint shall contain:
"1. The title of the cause, specifying the name of the court and county in which the action is brought, and the names of the parties to the action, plaintiff and defendant;
"2. A plain and concise statement of the facts constituting the cause of *577 action without unnecessary repetition; and
"3. A demand for the relief to which the plaintiff claims to be entitled. If the recovery of money is demanded, the amount thereof shall be stated."
North Dakota Revised Code of 1943.
It is to be noted that Subsection 3 of Section 28-0702 required that the amount be stated if recovery of money was demanded and that under Rule 8(a) there is no such requirement.
Both of these rules must be considered in the light of Rule 54(c) of the North Dakota Rules of Civil Procedure.
"RULE 54. JUDGMENTSCOSTS
* * * * * *
"(c) Demand for judgment. A judgment by default shall not be different in kind from or exceed in amount that prayed for in the demand for judgment. Except as to a party against whom a judgment is entered by default, every final judgment shall grant the relief to which the party in whose favor it is rendered is entitled, even if the party has not demanded such relief in his pleadings." (Emphasis supplied.)
* * * * * *
North Dakota Rules of Civil Procedure.
In the instant case the plaintiffs apparently initiated their action on the theory that they were entitled to compensatory damages for losses in cream and cattle only and for a period of merely one year.
The theory of the case was changed and the scope of the action enlarged when the plaintiffs, without objection, offered evidence of losses in income from custom combining, from rental of the Eidet land, and from cream and cattle, all for a period of approximately three years, which was the balance of the term of the lease.
As evidence beyond the scope of the pleadings was received without objection, the pleadings, including the prayer for relief, do not limit the amount of the verdict.
The defendant further contends that the verdict was the result of passion and prejudice of the jury and therefore should be set aside as excessive. In a decision rendered by this court in 1963, we said:
"* * * there is a presumption that the jury was composed of fair-minded persons and that the verdict expressed their honest judgment. This presumption disappears only where the verdict returned is so excessive as to shock the sense of justice of the court. In such case, the court will and should conclude that the jury was improperly influenced by either prejudice or passion. Carpenter v. Village of Dickey, 26 N.D. 176, 143 N.W. 964; Booren v. McWilliams, 34 N.D. 74, 157 N.W. 698.
"Such motion for new trial on the ground that the verdict was excessive is addressed to the sound, judicial discretion of the trial court, and this court will not set aside the determination of the trial court in the absence of a clear showing that such discretion was abused. Emery v. Midwest Motor Express, Inc., 79 N.D. 27, 54 N.W.2d 817; Montana-Dakota Utilities Co. v. Culver (N.D.), 80 N.W.2d 541; Lake v. Neubauer (N.D.), 87 N.W.2d 888." Kern v. Art Schimkat Construction Co., N.D., 125 N.W.2d 149, at 153.
When damages due to losses in income from custom combining, sales of cream, increase in livestock, and other miscellaneous items over a period of almost three years are considered, the amount of the verdict is amply supported by the evidence. Consequently, the verdict could not be said to be so excessive as to shock the *578 conscience of the court. We therefore find that the trial court did not abuse its discretion in denying the motion for a new trial.
It should be noted that the defendant assigned other specifications of error, but, as they were not supported by argument in his brief, they are deemed abandoned. Rule 8(b), Supreme Court of North Dakota, 76 N.D. xix; Mevorah v. Goodman, N.D., 68 N.W.2d 469; Regent Coop. Equity Exch. v. Johnston's Fuel Liners, N.D., 122 N.W.2d 151.
The judgment and order appealed from are affirmed.
MORRIS, C. J., and BURKE and TEIGEN, JJ., concur.
STRUTZ, J., did not participate. | 01-03-2023 | 10-30-2013 |
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