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https://www.courtlistener.com/api/rest/v3/opinions/1920047/ | 245 Pa. Superior Ct. 562 (1977)
369 A.2d 770
COMMONWEALTH of Pennsylvania
v.
Richard A. MITCHELL, Defendant-Appellant.
Superior Court of Pennsylvania.
Submitted December 16, 1975.
Decided February 18, 1977.
*563 Wayne G. Hummer, Jr., and Lombardo & Hummer, Lancaster, for defendant-appellant.
Charles A. Achey, Jr., Assistant District Attorney, and D. Richard Eckman, District Attorney, Lancaster, for appellee.
Before WATKINS, President Judge, and JACOBS, HOFFMAN, CERCONE, PRICE, VAN der VOORT and SPAETH, JJ.
*564 CERCONE, Judge:
This is an appeal from the judgment of sentence of the Court of Common Pleas, Criminal Division, of the County of Lancaster. Appellant, Richard A. Mitchell claims that he was denied his right to a speedy trial in that he was not brought to trial within 180 days from the date on which the criminal complaint was filed against him, thus violating Pa.R.Crim.P. 1100(a)(2).[1]
A written complaint was filed against appellant on July 15, 1974, charging him with burglary and theft by unlawful taking. The 180 days would normally have run on January 11, 1975. On November 25, 1974, the Commonwealth filed a petition for an extension of time for commencing trial pursuant to Pa.R.Crim.P. 1100(c).[2] A hearing on the Commonwealth's petition was held on November 29, 1974, and the appellant, although notified, did not appear. On January 7, 1975, the lower court granted the Commonwealth's petition and extended the date for commencement of trial 120 days from January 7, 1975, or until May 7, 1975. On January 16, 1975, appellant filed a petition pursuant to Pa.R.Crim.P. 1100(f)[3] alleging *565 that Rule 1100 of the Pennsylvania Rules of Criminal Procedure had been violated by the delay in the commencement of trial. Said petition was denied. On March 26, 1975, appellant renewed his application to dismiss, the lower court denied it and the matter proceeded to trial that same day and a jury verdict of guilty was returned also on the same day, March 26, 1975. In light of the fact that the trial was held within the 120 day extension granted on January 7, 1975, the seminal question in this case is whether, on January 7, the court below erred in granting the Commonwealth's petition for extension of time by extending the time for trial by 120 days from January 7, 1975.[4] We hold that the lower court did not err because we find that the delay in bringing the case to trial is within that type of "judicial delay" which our Supreme Court recently held could justify the granting of a petition for extension of time pursuant to Rule 1100(c), Commonwealth v. Shelton, 469 Pa. 8, 364 A.2d 694 (1976).
Any application by the Commonwealth pursuant to Rule 1100(c) must be filed prior to the expiration of the 180 day period. Commonwealth v. O'Shea, 465 Pa. 491, 350 A.2d 872 (1976). In the instant case, the application was filed on November 25, 1975, approximately six weeks before the end of the 180 day period. Therefore, procedurally, the Commonwealth filed a timely petition for extension of time.
Subsection c of Rule 1100 provides for extensions of the mandatory period where despite due diligence by *566 the Commonwealth, trial cannot be commenced within the 180 day mandatory period provided by the Rule. In analyzing the Commonwealth's petition for extension pursuant to Rule 1100(c) we find that the only reason given in requesting the extension was that the case had not been received by the court below until August 19, 1975 and that the docket had closed for presentation of case to the September Grand Jury of Lancaster County. Appellant admits that since Lancaster County did not have a scheduled criminal court term for the commencement of trial until January 13, 1975 it was inevitable that, without an extension, the 180 day rule would run and the charges would be dismissed. Anticipating this problem the district attorney filed for his extension alleging that it would be impossible for the district attorney's office to prosecute appellant within the 180 day period despite due diligence on the part of the prosecution.
The reason the case had not been returned before the docket was closed was due to the fact that the preliminary hearing, which was originally scheduled for July 22, 1974, was not held until August 13, 1974. This was in violation of Pa.R.Crim.P. 140(f)(1) which provides that a preliminary hearing should be held no later than ten days after preliminary arraignment.[5] However, it was not due to any lack of diligence on the part of the prosecutor but rather, it was due to a continuance requested by the Justice of the Peace.[6]
In Commonwealth v. Mayfield, 469 Pa. 214, 364 A.2d 1345 (1976), our Supreme Court reversed the decision of this Court and noted that:
"The Superior Court, concluding that rule 1100 was intended to promote prompt action by the courts as well as by the prosecution, held that delays attributable to court administration could never justify an extension *567 under rule 1100(c). The rule, however, was not intended to create such an inflexible result."
What has occurred in the case at bar is that a three week delay at the district magistrate's office resulted in an unavoidable four month delay for trial. Our Supreme Court recently stated that:
"The `Commonwealth' in the context of the Rule clearly refers to prosecutorial officers and not to the judiciary. Literally read, the Rule quite simply does not attempt to solve the problem of eliminating delay due to the judiciary; rather, it attempts to eliminate delay due to lack of due diligence on the part of prosecutorial officers." Commonwealth v. Shelton, supra, 469 Pa. at 16, 364 A.2d at 698.
The Shelton court later noted that "judicial delay" may, under certain circumstances, justify an extension "because of a causal relationship between the `judicial delay' and the Commonwealth's inability to commence trial despite due diligence." One of the examples cited by the court was, "Situations where the Commonwealth is prepared to commence trial prior to the expiration of the mandatory period but the court because of scheduling difficulties or the like is unavailable." The record of the hearing on the Commonwealth's petition for an extension of time clearly shows that because of the scheduling difficulties the case could not be heard prior to the expiration of 180 days. Thus this case is squarely within the mandate of the Shelton case. The court granted the Commonwealth an extension of 120 days thus specifying the period within which trial shall commence as mandated by Rule 1100(c), and the trial did, in fact, commence and conclude within the extension granted.
The delay in this case is within those circumstances which our Supreme Court has recognized as that type of "judicial delay" which the court does not find objectionable, and the delay occurred even though the Commonwealth *568 was diligent in attempting to bring the defendant to trial.
Accordingly, the judgment of sentence is affirmed.
HOFFMAN, J., files a dissenting opinion in which PRICE and SPAETH, JJ., join.
PRICE, J., files a dissenting opinion in which SPAETH, J., joins.
HOFFMAN, Judge, dissenting:
I join in the well-reasoned dissenting opinion by Judge PRICE, but am compelled to add a brief dissent because of confusion created by the Supreme Court's recent decisions in Commonwealth v. Mayfield, 469 Pa. 214, 364 A. 2d 1345 (1976), and Commonwealth v. Shelton, 469 Pa. 8, 364 A.2d 694 (1976).
Appellant's preliminary hearing was originally scheduled for July 22, 1974, but was continued until August 13, 1974, because of scheduling difficulties experienced by the justice of the peace. The lower court subsequently granted the Commonwealth's petition to extend pursuant to Rule 1100(c). However, a prerequisite to such an extension is that the Commonwealth exercise due diligence in bringing an accused to trial. Judge PRICE notes that the Supreme Court in Commonwealth v. Mayfield, supra, held that the judiciary as well as the prosecutor must exercise due diligence. See also, ABA Project on Standards for Criminal Justice, Standards Relating to the Function of the Trial Judge § 3.8 (Approved Draft, 1972); ABA Project on Minimum Standards for Criminal Justice, Standards Relating to Speedy Trial § 1.2 (Approved Draft, 1968). Further, Judge PRICE notes that the justice's failure to comply with Rule 140(f),[1] precludes *569 a finding that the Commonwealth demonstrated due diligence. I agree.
The Supreme Court reversed our holding in Mayfield, see Commonwealth v. Mayfield, 239 Pa.Super. 279, 362 A.2d 994 (1976), and stated that "[t]he Superior Court, concluding that rule 1100 was intended to promote prompt action by the courts as well as by the prosecution, held that delays attributable to court administration could never justify an extension under rule 1100(c). The rule, however, was not intended to create such an inflexible result." Commonwealth v. Mayfield, supra, 469 Pa. at 220, 364 A.2d at 1348. Nonetheless, Justice ROBERTS, writing for a unanimous court, was careful to note that the rule did not exempt the judiciary from the exercise of due diligence.
The Majority, however, resolves the instant problem by relying on language in Commonwealth v. Shelton, 469 Pa. 8, 364 A.2d 694 (1976), rather than on Commonwealth v. Mayfield, supra: "What has occurred in the case at bar is that a three week delay at the district magistrate's office resulted in an unavoidable four month delay for trial. Our Supreme Court recently stated that:
"`The "Commonwealth" in the context of the Rule clearly refers to prosecutorial officers and not to the judiciary. Literally read, the Rule quite simply does not attempt to solve the problem of eliminating delay due to the judiciary; rather, it attempts to eliminate delay due to lack of due diligence on the part of prosecutorial officers.' Commonwealth v. Shelton, supra, 469 Pa. at 16, 364 A.2d at 698." At 772. Although Shelton and Mayfield *570 were handed down on the same day by a unanimous court, I believe that the Court's position is inconsistent on whether the "Commonwealth" for purposes of the rule means the prosecutor or the entire court system. See also Commonwealth v. Silver, 238 Pa.Super. 221, 357 A.2d 612 (1976). In Shelton, the Supreme Court disapproved dicta in our Court's decision in the same case. Compare Commonwealth v. Shelton, supra, 469 Pa. at 19, 364 A.2d at 699 and Commonwealth v. Shelton, 239 Pa. Super. 195, 361 A.2d 873 (1976).[2] In turn, the language relied upon by the Majority was also unnecessary to the Supreme Court's decision. However, the issue was not dicta in Mayfield. Thus, I resolve any contradiction in language by relying on the holding in Mayfield and agree with Judge PRICE's conclusion that the judiciary must exercise due diligence.
Therefore, I dissent.
PRICE and SPAETH, JJ., joined in this dissenting opinion.
PRICE, Judge, dissenting:
I respectfully dissent. On July 15, 1974, a criminal complaint was filed against the appellant, charging him with burglary[1] and theft by unlawful taking.[2] On March 26, 1975, the appellant was convicted of these charges by a jury. The appellant now claims that his right to a speedy trial was denied in that he had not been brought to trial within 180 days from the date the criminal complaint was filed against him, as required by Pa. *571 R.Crim.P. 1100(a) (2).[3] After careful examination of the record, I agree with this contention, and would therefore reverse the judgment of sentence and discharge the appellant.
On November 25, 1974, the Commonwealth applied to the court below for an extension of time for commencement of trial pursuant to Pa.R.Crim.P. 1100(c).[4] On January 7, 1975, the court below granted the Commonwealth an extension of 120 days, or until May 7, 1975, for commencement of trial. On January 16, 1975, the appellant filed a petition to dismiss the charges against him for violation of his right to a speedy trial pursuant to Pa.R.Crim.P. 1100(f).[5]
The Commonwealth predicated its petition for an extension of time upon a claim that trial could not be commenced by January 13, 1975, the 180th day, because the case had not been received by the court below until August 19, 1974, which was five days after the docket had closed for presentation to the September Grand Jury of Lancaster County. Implicit in the Commonwealth's petition is a recognition that it was highly improbable that the appellant's trial could be commenced within the prescribed period because the next Grand Jury of Lancaster County was not scheduled to convene until January, *572 1975. The record clearly shows that the appellant was not responsible for any of the delay in the case reaching the court below. The Commonwealth admits that the case was delayed in being brought to the lower court solely because the appellant's preliminary hearing, scheduled for July 22, 1974,[6] was continued until August 13, 1974, at the request of the local Justice of the Peace. (NT 12) Because Justices of the Peace constitute an integral part of the judiciary of this Commonwealth, we must classify the instant delays as judicial delay. The majority interprets the recent Pennsylvania Supreme Court decisions in Commonwealth v. Mayfield, 469 Pa. 214, 364 A.2d 1345 (1976), and Commonwealth v. Shelton, 469 Pa. 8, 364 A.2d 694 (1976), as authority for its holding that the type of judicial delay present in the instant case justified the allowance of an extension of time for commencement of trial to the prosecution. I emphatically disagree with the majority's reading of these cases.
In Mayfield, the Supreme Court held that the prosecution may be granted an extension of time predicated solely upon the judiciary's inability to provide trial within the prescribed period. The court, however, recognized that the judiciary, as well as the prosecution, must exercise due diligence in implementing the objectives of Rule 1100 and therefore conditioned its holding by declaring that the Rule may not be ". . . circumvented by unwarranted grants of extensions." Commonwealth v. Mayfield, supra, 469 Pa. at 221, 364 A.2d at 1349. For this reason, the court declared that the:
"[T]rial court may grant an extension under rule 1100(c) only upon a record showing: (1) the `due diligence' of the prosecution, and (2) certification that trial is scheduled for the earliest date consistent with the court's business; provided that if the delay is due to the court's inability to try the defendant within the prescribed period, the record must also show the causes *573 of the court delay and the reasons why the delay cannot be avoided." Id. at 222, 364 A.2d at 1349-50.
There can be no doubt that the first requirement of the Mayfield test has been satisfied in the present case. The record clearly shows that the prosecution proceeded with due diligence to bring the appellant to trial. However, it is equally clear that the second requirement of the Mayfield test has not been met. The record reveals that the Justice of the Peace violated the mandate of Pa.R.Crim. P. 140(f)[7] by failing to arrange a preliminary hearing within three to ten days after the preliminary arraignment. As the majority notes, this failure on the part of the Justice of the Peace resulted in a four month delay in trial. The majority, however, fails to recognize that under Mayfield the ultimate responsibility for the actions of the lower judiciary lies with the trial court.[8] I believe we are therefore precluded from finding on the record either that trial was scheduled for the earliest date consistent with the court's business or that the trial court acted with due diligence in attempting to commence trial within the prescribed time. Further, although the record reveals that the Justice of the Peace's inaction caused the delay in trial, the record, in violation of Mayfield, is silent as to why the delay could not have been avoided. Because the record does not evidence compliance with the requirements of Mayfield and because the appellant's trial did not commence within the time period prescribed by Rule 1100(a)(2), I would reverse the judgment of sentence and discharge the appellant.
*574 Surprisingly, the majority, in affirming the judgment of sentence, ignores the requirements of the Supreme Court as prescribed in Mayfield. Instead, the majority relies upon certain language from Commonwealth v. Shelton, supra, as authority for its holding. The Supreme Court there stated:
"[A]lthough we rule `judicial delay' may justify an extension, it does not follow that every period of time utilized by a court in considering a matter pending before it relating to the accused will justify an extension. To the contrary, Rule 1100 allows an adequate period of time in which the Commonwealth may prepare its case and during which matters preliminary to trial may be disposed of. . . .
While the following situations are not to be considered exclusive, they represent the type of circumstances wherein an extension may be justifiably granted because of a causal relationship between the `judicial delay' and the Commonwealth's inability to commence trial despite due diligence. . . . (2) Situations where the Commonwealth is prepared to commence trial prior to the expiration of the mandatory period but the court because of scheduling difficulties or the like is unavailable." Id. 469 Pa. at 17-18, 364 A.2d at 698-99.
I believe the majority's reliance upon this language to be improper for several reasons. First, the requirements prescribed by the Supreme Court in Mayfield must be satisfied before an extension of time for commencement of trial can be justified. The examples given by the court in Shelton were clearly meant to serve only as general guidelines in determining a sufficient basis for an extension of time. The mandate of Mayfield is clear: Each individual fact situation, even a situation apparently envisioned by the court in Shelton, must comply with the Mayfield test. Here, as previously demonstrated, the record does not show compliance with those requirements. *575 Secondly, this case certainly does not fit "squarely within the mandate of the Shelton case." The example used by the court in Shelton, and relied upon by the majority here, depicts a situation in which the trial court is unable, despite due diligence, to hear a case, otherwise ready for trial, within the prescribed time period because of "scheduling difficulties or the like. . . ." Commonwealth v. Shelton, supra, 469 Pa. at 18, 364 A.2d at 699. Here, the delay was not caused because the court was unavailable due to an unavoidable court backlog "or the like;" rather, it was occasioned by an unexplained violation by the lower court of a specific rule of procedure.
Rule 1100 was adopted "[i]n order to reduce the backlog of criminal cases in the courts of common pleas and to provide an objective standard for the protection of a defendant's right to a speedy trial . . .." Commonwealth v. White, 469 Pa. 460, 366 A.2d 880 (1976). In Mayfield, the Supreme Court provided the courts of this Commonwealth with a means by which to determine whether a sufficient basis exists to justify an extension of time. The purpose of this test is to ensure that the underlying principle of Rule 1100 is upheld. I believe that the holding of the majority not only distorts the import of both Mayfield and Shelton but also ignores the express mandate of Mayfield and destroys the protective function of the Rule.
I would reverse the judgment of sentence.
SPAETH, J., joins in this dissenting opinion.
NOTES
[1] Pa.R.Crim.P. 1100(a)(2) provides that:
"Trial in a court case in which a written complaint is filed against the defendant after June 30, 1974 shall commence no later than one hundred eighty (180) days from the date on which the complaint is filed."
[2] Pa.R.Crim.P. 1100(c) provides that:
"At any time prior to the expiration of the period for commencement of trial, the attorney for the Commonwealth may apply to the court for an order extending the time for commencement of trial. A copy of such application shall be served upon the defendant through his attorney, if any, and the defendant shall also have the right to be heard thereon. Such application shall be granted only if trial cannot be commenced within the prescribed period despite due diligence by the Commonwealth. Any order granting such application shall specify the date or period within which trial shall be commenced."
[3] Pa.R.Crim.P. 1100(f) provides in pertinent part that:
"At any time before trial, the defendant or his attorney may apply to the court for an order dismissing the charges with prejudice on the ground that this Rule has been violated.. . ."
[4] It appears, from the transcript of March 26, that the case was set for trial during the January, 1975 Term but was continued when the Commonwealth learned that appellant's co-defendant was incarcerated in Tennessee. Significantly, however, trial commenced on March 26, 1975, clearly within the period of time allowed by the court's 120 day extension granted on January 7, 1975. There is no allegation, by appellant, that trial could have been held prior to the expiration of the 180 day period on January 11, 1975, without a special term of court.
[5] Appellant was arraigned on July 15, 1974.
[6] The reasons for the requested continuance by the Justice of the Peace are not apparent from the record.
[1] Rule 140(f) provides: "when a preliminary hearing is not waived, the issuing authority shall:
"(1) fix a day and hour for a preliminary hearing which shall not be less than three nor more than ten days after preliminary arraignment unless extended for cause shown, unless the issuing authority fixes an earlier date upon request of the defendant or his attorney with the consent of the complainant and the attorney for the Commonwealth;
"(2) give the defendant notice of the time and place of hearing thus fixed; and
"(3) afford the defendant a reasonable opportunity to post bail, and if bail is not so obtained, commit him to jail according to law."
[2] The Supreme Court agreed with this Court that the Commonwealth's failure to petition to extend pursuant to Rule 1100(c) mandated a dismissal of the charges. Our Court had gone further and discussed whether, had a timely petition been filed, the justification offered by the Commonwealth courtroom unavailability could justify an extension.
[1] 18 Pa.C.S. § 3502.
[2] 18 Pa.C.S. § 3921.
[3] Pa.R.Crim.P. 1100(a)(2) provides that: "[t]rial in a court case in which a written complaint is filed against the defendant after June 30, 1974 shall commence no later than one hundred eighty (180) days from the date on which the complaint is filed."
[4] Pa.R.Crim.P. 1100(c) provides in pertinent part:
"At any time prior to the expiration of the period for commencement of trial, the attorney for the Commonwealth may apply to the court for an order extending the time for commencement of trial. . . . Such application shall be granted only if trial cannot be commenced within the prescribed period despite due diligence by the Commonwealth."
[5] Pa.R.Crim.P. 1100(f) provides in pertinent part:
"At any time before trial, the defendant or his attorney may apply to the court for an order dismissing the charges with prejudice on the ground that this Rule has been violated.. . ."
[6] The appellant was arraigned on July 15, 1974.
[7] Pa.R.Crim.P. 140(f)(1) provides:
"When a preliminary hearing is not waived, the issuing authority shall: (1) fix a day and hour for a preliminary hearing which shall not be less than three nor more than ten days after preliminary arraignment unless extended for cause shown, unless the issuing authority fixes an earlier date upon request of the defendant or his attorney with the consent of the complainant and the attorney for the Commonwealth."
[8] Clearly, the appellant has no obligation to arrange for a preliminary hearing. E.g., Commonwealth v. Adams, 237 Pa.Super. 452, 352 A.2d 97 (1975). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3346131/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]MEMORANDUM ON MOTION FOR REQUEST FOR CERTIFICATION
The plaintiffs have moved the court that an issue before it be certified to the Connecticut Supreme Court for determination of the law of the state on that issue. The issue is whether there is a right of action for money damages under the state constitution.
The plaintiffs purport to make this motion under Practice Book § 4168 et seq.; Chapter 74, Special Certification Proceedings. Sections 4167 through 4174 deal with questions certified to our supreme court by the federal courts. Sections 4176 through 4180 of the Practice Book concern certification procedure under Section 52-265a of the General Statutes. That statutory section applies to rights of certification given to "any party to an action who is aggrieved by an order or decision of the superior court." This court has made no order or decision on the issue which the plaintiffs seek to have certified and which was presented to the court on a motion to strike.
The plaintiffs may be trying to rely on Practice Book § 4147 (See § 52-235 C.G.S.A.) but reservations of questions of law may be made only if all parties consent to the procedure CT Page 10123-E which is not the case here, see statute, also see stipulation requirement of Practice Book § 4148 which contemplates consent of all parties to the procedure, also see Sargent Co. v. NewHaven Steamboat Co., 67 Conn. 116, 128 1894).
The motion to strike should be set down for further argument. Although the matter was argued in March the court kept receiving briefs going to the merits of the issue until the end of June. Having denied this motion the court would request counsel to contact his clerk for a date to schedule further argument on the motion to strike.
Corradino, J. | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/1614121/ | 23 So.3d 120 (2009)
RITTER
v.
STATE.
No. 2D09-938.
District Court of Appeal of Florida, Second District.
November 23, 2009.
Decision Without Published Opinion Appeal dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2860680/ | <HTML>
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<P><SPAN STYLE="font-size: 14pt"><STRONG><CENTER>TEXAS COURT OF APPEALS, THIRD DISTRICT, AT AUSTIN</STRONG></SPAN></CENTER>
</P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P><HR ALIGN="CENTER" WIDTH="26%">
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<STRONG><CENTER>NO. 03-9<A NAME="1">6</A>-00<A NAME="2">266</A>-CV</CENTER>
</STRONG>
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</P>
<STRONG></STRONG><CENTER><A NAME="3">Wireless Providers of Texas, et al.<A HREF="#N_1_"><SUP> (1)</SUP></A></A>, Appellants</CENTER>
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><CENTER>v.</CENTER>
</STRONG></P>
<BR WP="BR1"><BR WP="BR2">
<P ALIGN="CENTER"><STRONG><A NAME="4">Advisory Commission on State Emergency Communications and The Greater Harris County
9-1-1 Emergency Network</A>, Appellees</STRONG></P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P><STRONG><HR SIZE="3">
</STRONG></P>
<SPAN STYLE="font-size: 11pt"><STRONG><CENTER>FROM THE DISTRICT COURT OF <A NAME="5">TRAVIS</A> COUNTY, <A NAME="6">261ST</A> JUDICIAL DISTRICT</CENTER>
</STRONG></SPAN>
<P><SPAN STYLE="font-size: 11pt"><STRONG><CENTER>NO. <A NAME="7">95-15818</A>, HONORABLE <A NAME="8">F. SCOTT MCCOWN</A>, JUDGE PRESIDING </STRONG></SPAN><STRONG></CENTER>
</STRONG></P>
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</STRONG></P>
<STRONG>PER CURIAM</STRONG>
<BR WP="BR1"><BR WP="BR2">
<P> Appellants have filed a motion to dismiss the appeal. We grant the motion.</P>
<P> The appeal is dismissed. Tex. R. App. P. 59(a)(1)(B).</P>
<BR WP="BR1"><BR WP="BR2">
<BR WP="BR1"><BR WP="BR2">
<P>Before Justices Powers, Jones and Kidd</P>
<BR WP="BR1"><BR WP="BR2">
<P>Appeal Dismissed on Appellants' Motion</P>
<BR WP="BR1"><BR WP="BR2">
<P>Filed: August 28, 1997</P>
<BR WP="BR1"><BR WP="BR2">
<P>Do Not Publish
<P><A NAME="N_1_">1. </A> For a complete list of appellants, see our judgment of this date.</P>
</BODY>
</HTML> | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1613989/ | 23 So. 3d 1187 (2009)
RILEY
v.
STATE.
No. 1D09-4855.
District Court of Appeal of Florida, First District.
December 14, 2009.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1613967/ | 23 So. 3d 981 (2009)
STATE of Louisiana
v.
Rayard BELL.
No. 2009-KA-0588.
Court of Appeal of Louisiana, Fourth Circuit.
October 14, 2009.
*982 Leon A. Cannizzaro, Jr., District Attorney, Alyson Graugnard, Assistant District Attorney, New Orleans, LA, for State/Appellee.
*983 John Harvey Craft, Louisiana Appellate Project, New Orleans, LA, for Defendant/Appellant.
(Court composed of Judge TERRI F. LOVE, Judge EDWIN A. LOMBARD, Judge PAUL A. BONIN).
EDWIN A. LOMBARD, Judge.
The defendant, Rayard Bell, appeals the denial of his motion to reconsider sentence. After review of the record in light of the applicable law and arguments of the parties, the judgment of the trial court is affirmed.
Relevant Facts and Procedural History
The defendant was convicted of being a felon in possession of a firearm in violation of La. Rev.Stat. 14:95.1 and, on March 31, the assigned sentencing date, the trial judge court took testimony from defendant's mental health case worker and ordered a pre-sentence investigation. On September 12, 2008, the defendant was sentenced to serve fifteen years at hard labor with the Department of Corrections. The defendant's motion for reconsideration of sentence was denied by the trial court.
Discussion
In his sole assignment of error on appeal, the defendant argues that he was subjected to an unreasonable sentence due to improper content in the presentence report. Specifically, he claims that the contents of the presentence report was unduly prejudicial, result in an unusually harsh sentence, and that he was denied an opportunity to properly confront William Purcell, his probation officer and preparer of the presentence report. He further argues that the probation officer supplemented the presentence report with personal testimony assailing the defendant, and refers to the following passage from the report to support this assertion:
This agent supervised Rayard Bell during his parole and probation tenure prior to his arrest. He was honest about his prior firearms arrest, and admitted to me that he had a shotgun in his possession and used cocaine. Mr. Bell was seen at his residence monthly and originally slept in the front living room on an air mattress. During a home visit on April 5, 2007, Mr. Bell informed this agent that he had moved to the back bedroom. He was arrested a little over two weeks later for the instant offense and additional weapons and ammo clips were found in the back bedroom. The subject never stated to this officer that his nephew, Andre Bell, a convicted felon and on active probation at the time, was also living at the residence.
The defendant asserts that the testimony of the probation officer was presented in manner that did not afford him an opportunity to confront the probation officer. The record reflects, however, that contrary to the defendant's argument, the probation officer was presented by the State as its first witness in the defendant's trial. Accordingly, there is no merit to the defendant's claim that he was denied an opportunity to counter the "personal testimony" of the probation officer.
The Code of Criminal Procedure sets forth the factors which must be considered by the trial court in imposing sentence. La.Code Crim. Proc. art. 894.1, Section C states:
The court shall state for the record the considerations taken into account and the factual basis therefore in imposing sentence.
Articulation of the factual basis for a sentence is the goal of La.Code Crim. Proc. art. 894.1, not rigid or mechanical compliance with its provisions and, accordingly, the trial judge is not required to list every aggravating or mitigating *984 circumstance so long as the record reflects that he adequately considered the guidelines of the article. See State v. Lanclos, 419 So. 2d 475, 478 (La.1982) (where the record clearly shows an adequate factual basis for the sentence imposed, remand is unnecessary even where there has not been full compliance with La.Code Crim. Proc. art. 894.1); State v. Davis, 448 So. 2d 645, 653 (La.1984) (the trial court need not recite the entire checklist of article 894.1, but the record must reflect that it adequately considered the guidelines). In this case, the trial judge discussed in great detail the factors he considered and the reasoning by which he arrived at his sentencing decision in a ten-page colloquy. In so doing, the court adequately complied with Article 894.1.
The defendant also argues that his sentence is excessive, citing Article I, Section 20 of the Louisiana Constitution which prohibits excessive punishment:
Even a sentence which is within the statutory limits may violate a defendant's constitutional right against excessive punishment if it is "grossly out of proportion to the severity of the crime" or is "nothing more than the purposeless imposition of pain and suffering"
Historically, trial courts have been granted wide discretion in sentencing, absent a definitive showing that the court has abused that discretion. See State v. Louis, 496 So. 2d 563, 568 (La.App. 1 Cir.1986) (the trial court has wide discretion in the imposition of sentences and a sentence within statutory limits will not be set aside in the absence of an abuse of discretion). "Generally, the reviewing court must determine whether the trial judge adequately complied with the guidelines set forth in La.Code Crim. Proc. art 894.1 and whether the sentence is warranted in light of the particular circumstances of the case." State v. Pleasant, 99-2349, p. 13 (La.App. 4 Cir. 11/8/00), 772 So. 2d 910, 917. Because a sentence could be excessive even though it falls within the statutory limit, the trial court's statements regarding the factors considered under Article 894.1 of the Code of Criminal Procedure are an important aid in reviewing an alleged excessive sentence. State v. Trepagnier, 97-2427, p. 11 (La.App. 4 Cir. 9/15/99), 744 So. 2d 181, 189 (citation omitted). Once adequate compliance with Article 894.1 is found, the reviewing court must determine "whether the sentence imposed is too severe in light of the particular defendant and the circumstances of the case, keeping in mind that maximum sentences should be reserved for the most egregious violators of the offense so charged." State v. Ross, 98-0283, p. 8 (La.App. 4 Cir. 9/8/99), 743 So. 2d 757, 762.
In this case, we do not find that the defendant's fifteen year sentence is excessive. See State v. Taylor, 04-689, p. 6 (La.App. 5 Cir. 12/14/04), 892 So. 2d 78 (upholding fifteen-year sentence for defendant who was stopped while driving a stolen vehicle in which a handgun was discovered between the driver's seat and center console; the defendant's record revealed numerous felony convictions including drug possession, one possession which occurred while he was in custody, and an arrest for illegal use of a weapon); see also State v. Crawford, 03-1494 (La.App. 5 Cir. 4/27/04), 873 So. 2d 768 (defendant's maximum fifteen-year sentence for felon in possession of a firearm upheld, noting defendant's previous convictions for violent offenses and recidivism tendencies); State v. Bannister, 38,967, p. 10 (La.App. 2 Cir. 9/22/04), 882 So. 2d 693; State v. Bannister, 38,967, p. 10 (La.App. 2 Cir. 9/22/04), 882 So. 2d 693 (upholding fifteen-year sentence for a felon in possession of a firearm where the defendant has prior convictions, noting that the defendant's presentence *985 report revealed he had six prior felony convictions); State v. Willis, 36,759, p. 2 (La.App. 2 Cir. 4/9/03), 843 So. 2d 592, 600 (fifteen-year maximum sentence for a felon in possession of a firearm not excessive, noting that defendant had many prior arrests and convictions involving substance abuse, use of dangerous weapons and crimes of violence).
The trial judge in this case noted in mitigation the portion of the presentence report referencing the positive comments by Ms. Janice Bolin, the defendant's mental health counselor. The probation officer interviewed her as part of his presentence investigation and devoted a paragraph in his report to her statement:
"Ms. Janice Bolin was interviewed on April 4, 2008. She is a mental health counselor with the Mental Health Court, which is currently held in Section "K" of Orleans Parish Criminal District Court. She stated that Mr. Bell was very stable prior to his arrest. She believed that the police officers gave false testimony during the subject's trial and believes that the Rayard Bell is innocent."
The trial judge also noted for the record his awareness of a letter, purportedly mailed by the defendant's younger relative, in which the relative accepts responsibility for and ownership of the weapons found on the night in question. The trial judge held, however, that such an admission alone would not clear the defendant because they could have shared control of the weapons. The trial judge took notice of the number of weapons involved in the incident and the defendant's prior convictions for simple burglary and aggravated burglary. The trial judge also referred to the presence of a small child in the residence, calling the situation "grossly negligent, gross negligence at a bare minimum." Further, the trial judge noted that the defendant's record covered over thirty years:
Thirty years of the New Orleans Police arresting you, bringing you to jail, having you released. Their frustration, I can only begin to imagine it. Thirty years Mr. Bell has been placed in and out of the jails of this city and this state. Thirty years. Thirty years.
Accordingly, the trial judge heard both mitigating and aggravating evidence concerning the defendant and adequately enunciated his reasons for the sentence imposed. Thus, we find that the trial judge adequately complied with Article 894.1 and that the sentence is not disproportionate.
Conclusion
In accordance with the foregoing reasons, the defendant's conviction and sentence are affirmed.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1613995/ | 939 So. 2d 1106 (2006)
FOOD LION, LLC, Appellant,
v.
MONUMENT/JULINGTON ASSOC. LTD. PARTNERSHIP, a/k/a STAFFORD DEVELOPMENT CO. and FAY CHAMBERLAIN, Appellees.
Case No. 1D05-3769.
District Court of Appeal of Florida, First District.
Opinion filed September 20, 2006.
James G. Lindquist, Esquire and David M. Fernandez, Esquire of Barr, Murman & Tonelli, P.A., Tampa, for Appellant.
Charles Cook Howell, III, Esquire of Howell & O'Neal, P.A., Jacksonville, for Appellee Monument/Julington Assoc. Ltd. Partnership, a/k/a Stafford Development Co. and Randall Rutledge, Esquire, Jacksonville, for Appellee Fay Chamberlain.
BENTON, J.
This case grows out of a dispute between the owner of a shopping center and one of its tenants, a grocery store, about who is responsible for injuries Fay Chamberlain, a grocery store customer, sustained when she slipped on an icy sidewalk outside the store. The grocer leases the store building, but not the sidewalk. We reverse summary judgment entered in favor of the shopping center owner.
The customer sued the owner and Food Lion, LLC (Food Lion), the grocer. Food Lion filed a cross-claim against the shopping center owner for indemnification and contribution, a cross-claim it later dismissed. Judgment was entered thereafter against the plaintiff on the owner's motion for summary judgment, which the customer did not oppose or appeal. Here, as below, however, Food Lion argues that entering summary judgment in favor of the owner and against the customer was error. See Holton v. H.J. Wilson Co., Inc., 482 So. 2d 341, 342 (Fla. 1986) (recognizing a civil defendant's "right to appeal alleged errors in judgments exonerating codefendants").
The mere right to appeal does not obviate the necessity to preserve for appeal every point urged on appeal. See, e.g., C.M. v. Dep't of Child. & Fam. Servs., 854 So. 2d 777, 780 (Fla. 4th DCA 2003) ("[T]he error was not preserved and is not a ground for reversing the order terminating the mother's parental rights."). Food Lion's dismissal of its cross-claim precludes relief on the present appeal, therefore, on the claims for indemnification and contribution it first stated in the cross-claim, then abandoned by dismissing the cross-claim.
But the judgment exonerating the shopping center owner also affects important procedural rights Food Lion would otherwise have, under Fabre v. Marin, 623 So. 2d 1182, 1183-85 (Fla. 1993), receded from in part on other grounds in Wells v. Tallahassee Mem'l Reg'l Med. Ctr., Inc., 659 So. 2d 249, 250-54 (Fla. 1995), and its progeny, see Thomas v. Daniel, 736 So. 2d 100, 101(Fla. 1st DCA 1999) ("[T]o include a nonparty on a verdict form, defendants seeking to raise third-party liability must not only plead the nonparty's negligence as an affirmative defense, but must also specifically . . . prove the nonparty's fault in causing the accident."), and Food Lion did argue against entry of summary judgment below.
Accordingly, we reach Food Lion's contention that summary judgment should be reversed because the shopping center owner's nondelegable duties to Ms. Chamberlain did not, on the facts developed below, rule out liability on the part of the owner for her injuries. A landowner owes a business invitee a duty not only to react to hazards of which it has notice but also to inspect to ensure conditions are safe or, at the least, that hazards (unless open and obvious) are discovered and warned against. See Lynch v. Brown, 489 So. 2d 65, 66 (Fla. 1st DCA 1986); Anderson v. Walthal, 468 So. 2d 291, 294 (Fla. 1st DCA 1985) (explaining that the landlord had a duty "to use ordinary care in keeping the premises in a reasonably safe condition"). See also § 768.0710(2)(b), Fla. Stat. (2002) ("Actual or constructive notice of the transitory foreign object or substance is not a required element of proof to this claim.").
Whether a landlord's duty to maintain the premises "ha[s] been breached is ordinarily a question for the jury to decide." Hancock v. Dep't of Corr., 585 So. 2d 1068, 1071 (Fla. 1st DCA 1991). We reverse and remand for a trial at which "evidence of notice or lack of notice" can be adduced "together with all of the [other] evidence," § 768.0710(2)(b), Fla. Stat. (2002), on the plaintiff's claims.
Reversed and remanded.
ERVIN and BROWNING, JJ., CONCUR.
NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1613991/ | 939 So. 2d 251 (2006)
MAYNOR E. MONNAR, Appellant,
v.
STATE OF FLORIDA, Appellee.
Case No. 1D06-1923.
District Court of Appeal of Florida, First District.
Opinion filed October 16, 2006.
Maynor E. Monnar, pro se, Appellant.
Charlie Crist, Attorney General, and Anne C. Conley, Assistant Attorney General, Tallahassee, for Appellee.
PER CURIAM.
Appellant seeks review of the denial of his motion filed pursuant to Florida Rule of Criminal Procedure 3.800(a). We reverse and remand for further proceedings consistent with this opinion.
In October 1997, appellant was convicted of one count of aggravated battery on a law enforcement officer and four counts of resisting an officer with violence and sentenced to 15 years and 18 days in prison. On appeal, we reversed three of the four convictions for resisting an officer with violence because all four charges arose out of a single criminal episode. Monnar v. State, 752 So. 2d 1252 (Fla. 1st DCA 2000). Appellant was resentenced in September 2000 to 88 months in prison, with the trial court assessing 40 points on appellant's guidelines scoresheet for severe victim injury.
Appellant contends that the jury never found severe victim injury and, thus, the trial court's assessment of victim injury points on his guidelines scoresheet violated his Sixth Amendment right, as explained in Apprendi v. New Jersey, 530 U.S. 466 (2000), to have all facts increasing his sentence beyond the statutory maximum found by a jury. He further alleges that without the inclusion of the victim injury points, his maximum guidelines sentence would be 37 months in prison.
Pursuant to Apprendi, the facts supporting the imposition of a sentence beyond the statutory maximum must be found beyond a reasonable doubt by a jury or admitted by the defendant. As clarified in Blakely v. Washington, 542 U.S. 296, 303 (2004), the statutory maximum is "the maximum sentence a judge may impose solely on the basis of the facts reflected in the jury verdict or admitted by the defendant" (emphasis in original). Therefore, under Apprendi and Blakely, appellant is entitled to a jury determination of severe victim injury when the inclusion of the points increases his sentence beyond the guidelines maximum. See Behl v. State, 898 So. 2d 217 (Fla. 2d DCA 2005) (applying the ruling in Apprendi to a trial court's assessment of victim injury points). Thus, the trial court's finding of severe victim injury, which supported the increase in appellant's guidelines sentence, violated appellant's Sixth Amendment rights.
On appeal, the state asserts that Apprendi does not apply to appellant's case because his convictions became final before Apprendi. However, in Isaac v. State, 911 So. 2d 813 (Fla. 1st DCA 2005), we held that Apprendi applies to cases, such as this one, where the defendant is resentenced after Apprendi was decided. But see Barron v. State, 31 Fla. L. Weekly D825 (Fla. 2d DCA Mar. 17, 2006) (certifying conflict with Isaac); Galindez v. State, 910 So. 2d 284 (Fla. 3d DCA) (holding Apprendi did not apply to convictions rendered prior to its issuance notwithstanding future resentencing proceedings post-Blakely, and certifying conflict with Isaac), review pending, SC05-1341 (Fla. filed July 29, 2005); Garcia v. State, 914 So. 2d 20 (Fla. 4th DCA 2005) (certifying conflict with Isaac); Langford v. State, 929 So. 2d 598 (Fla. 5th DCA 2006) (certifying conflict with Isaac). Furthermore, even though appellant was resentenced prior to Blakely, the holding of \sect fs28 Blakely applies to appellant's case because Blakely is a clarification of Apprendi. See Isaac, 911 So. 2d at 815; Morrow v. State, 31 Fla. L. Weekly D466 (Fla. 1st DCA Feb. 13, 2006). Because Apprendi and Blakely apply to appellant's case, we reverse the summary denial of appellant's motion and remand to the trial court with directions that it either resentence appellant or refute appellant's claim with record attachments.
REVERSED and REMANDED, with directions.
WEBSTER, BENTON, and VAN NORTWICK, JJ., CONCUR.
NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614016/ | 939 So. 2d 1123 (2006)
Mark WALLACE, Appellant,
v.
The STATE of Florida, Appellee.
No. 3D05-1158.
District Court of Appeal of Florida, Third District.
October 4, 2006.
Rehearing Denied October 17, 2006.
*1124 Bennett H. Brummer, Public Defender, and Lisa S. Walsh, Special Assistant Public Defender, for appellant.
Charles J. Crist, Jr., Attorney General, and William J. Selinger, Assistant Attorney General, for appellee.
Before CORTIÑAS, ROTHENBERG, and LAGOA, JJ.
LAGOA, Judge.
Mark Wallace,(hereinafter "Defendant"), appeals the trial court's denial of his post-sentencing motion to withdraw his plea, arguing that the trial court erred by not holding an evidentiary hearing on the issue. Because we conclude that the trial court did not err in summarily denying Defendant's post-sentence motion to withdraw his plea, we affirm.
The standard of review for a trial court's denial of a motion to withdraw a plea is abuse of discretion. See Williams v. State, 919 So. 2d 645, 646 (Fla. 4th DCA 2006)(denial of motion to withdraw guilty plea without evidentiary hearing not abuse of discretion). If the motion to withdraw a plea occurs, as is the case here, after sentencing, the defendant has the burden of proving that a "manifest injustice has occurred." Id.
On February 24, 2005, Defendant filed a pro se motion to withdraw his plea pursuant to Florida Rule of Criminal Procedure 3.170(l). In his motion, Defendant alleged that defense counsel failed to convey a favorable plea offer to him and that he entered into the plea under duress. In a supplemental motion, Defendant argued that defense counsel coerced him into entering into the plea. The trial court denied the motion without holding an evidentiary hearing.
On appeal, Defendant argues that he is entitled to an evidentiary hearing because the record does not refute his allegation of ineffective assistance of counsel. We respectfully disagree with Defendant's contention, as his allegations are conclusively refuted by the record and he cannot show that a manifest injustice has occurred.
The facts of this case are similar to Williams v. State, 919 So. 2d 645 (Fla. 4th DCA 2006). In Williams, the defendant filed a motion to withdraw his plea pursuant to Florida Rule of Criminal Procedure 3.170(l), asserting that his defense counsel coerced him into entering into the plea. Id. at 646. The trial court denied the motion without holding an evidentiary hearing and the Fourth District affirmed "[b]ecause [defendant's] motion to withdraw [his] plea made no factual allegations of `coercion' that were not completely refuted by the sworn plea colloquy." Id. Specifically, at the plea colloquy the defendant stated that he had not been forced, threatened or coerced into making an open plea in court. Moreover, the defendant *1125 acknowledged signing "two forms stating that he had not been coerced into relinquishing his rights by entering a plea . . . [and][w]hen asked whether he was satisfied with his attorney's services, Williams said `yes'." Id. As the Williams court observed, "[w]here the coercion alleged is legally insufficient or conclusively refuted by the record, there is no need to hold an evidentiary hearing or appoint conflict-free counsel." Id.
In this case, Defendant's allegations of coercion or ineffective assistance of counsel are conclusively refuted by the record. First, Defendant, in his motion, admits that he was aware of the first plea offer but that he rejected it.[1] While out on bond, however, Defendant committed two additional felonies and was placed in custody. In his motion, Defendant admits being advised by his counsel that the State was now offering a less favorable plea "a plea of 20 with a mandatory 15 years in prison" and that he "agreed with counsel that such [a] plea was unacceptable." The record is therefore clear that Defendant was aware of and rejected the State's plea offers.
Second, as in Williams, the trial court's inquiry prior to accepting the Defendant's plea conclusively shows that the Defendant is not entitled to the relief sought.
THE COURT: Has anyone threatened you or coerced you into entering into this plea?
THE DEFENDANT: No.
THE COURT: Are you presently under the influence of drugs or alcohol?
THE DEFENDANT: No.
. . .
THE COURT: Sir, you were given a rights waiver form, did you read it, understand it an [sic] sign it?
THE DEFENDANT: Yes, I did.
THE COURT: Do you have any questions about it?
THE DEFENDANT: No.
THE COURT: You are also represented by an attorney, have you discussed this plea with your lawyer, have you had sufficient time to do that?
THE DEFENDANT: Yes.
THE COURT: And you understand has your lawyer done everything that you asked him to do, has he filed all motions, taken all depositions or investigated every single aspect of this case?
THE DEFENDANT: Yes.
THE COURT: Are you satisfied with his services?
THE DEFENDANT: Yes.
Thus, during the plea colloquy, Defendant stated that no one threatened or coerced him into making the plea, that he was satisfied with his attorney's services, and acknowledged signing a written plea of guilty waiver form.
Third, the written plea also refutes Defendant's allegations. That document, signed by both the Defendant and his counsel, contains the following pertinent language:
This plea is in my own best interest. . . . I am not under the influence of any alcohol or drugs at this time, nor am I presently suffering from any mental defect. I fully understand the Judge's instructions, this document . . . all the legal proceedings herein, and all of my *1126 rights under the law. No one, including my attorney or the Judge, has made any promises, threats, or representations to me to induce me to enter this plea. Further, no promises or representations were made to me apart from those discussed during the plea colloquy, nor has anyone, especially my attorney, made any promises to me concerning my eligibility for any form of early release authorized by law and the actual amount of time I will serve under the sentence that the court will impose. . . . I further understand that I am waiving any right that I may have to withdraw this plea and that my plea of guilty or no contest to the charge(s) are final and may not be withdrawn without the consent of the court. . . . I am mentally alert and am entering this plea knowingly, intelligently and voluntarily. I understand I have the right to speak to the Judge concerning the sentence before sentencing, and to appeal in writing within thirty (30) days. . . . I have read, understand, and agree with all the contents, terms and conditions on both sides of this form, including that portion entitled "Satisfaction with Attorney."
The written plea also contained a separate section signed by Defendant entitled "Satisfaction with Attorney" that stated:
I am voluntarily entering this plea after having had adequate, complete, and full consultation with my attorney. My counsel has done everything that I have asked him/her to do on my behalf and has filed with the court all pleadings, motions and documents that I wanted him/her to file. My counsel has spoken to and discussed my case with all the witnesses and prospective witnesses that I requested that he/she talk to, and has discussed my case with me fully and completely. My attorney, among other things, has fully discussed the strengths and weaknesses of my case and the State of Florida's case, as well as any defenses I may have to the charge(s) against me. Further, my attorney has raised all the objections and defenses that I wanted to be raised with the prosecutor and/or the court. My attorney has been competent, professional, and effective throughout his/her representation of me. I am completely satisfied with the representation that my attorney has afforded me.
Because the allegations of coercion and ineffective assistance of counsel are conclusively refuted by the record, there is no need to hold an evidentiary hearing. Accordingly, we affirm the trial court's order denying Defendant's motion to withdraw plea.
Affirmed.
NOTES
[1] In his motion, Defendant states that he "appeared before this Honorable Court on August 30, 2004 regarding case numbers F04-14924, F04-14926, and F04-14927. Counsel advised Defendant, who was out on felony bond, that the State was offering a plea of 15 years with a mandatory 10 years. Defendant did not accept [the] plea [and the][c]ases were set for trial." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1618064/ | 38 So. 3d 1131 (2010)
STATE of Louisiana
v.
Derone PATTERSON.
No. 2009-KA-0645.
Court of Appeal of Louisiana, Fourth Circuit.
May 12, 2010.
*1132 Leon A. Cannizzaro, Jr., District Attorney, Alyson Graugnard, Assistant District Attorney, New Orleans, LA, for The State of Louisiana.
Michael H. Idoyaga, Louisiana Appellate Project, New Orleans, LA, for Defendant, Derone Patterson.
(Court composed of Judge DENNIS R. BAGNERIS, SR., Judge MAX N. TOBIAS, JR., Judge EDWIN A. LOMBARD).
MAX N. TOBIAS, JR., Judge.
On 4 February 2008, the defendant, Derone Patterson ("Patterson"), was charged by a bill of information with being a felon in possession of a firearm and with possessing cocaine in an amount of twenty-eight grams or more, but less than two hundred grams. Patterson pled not guilty at his arraignment. On 10 and 20 October 2008, testimony was given at a hearing on his motion to suppress the evidence. On 16 December 2008, the trial court denied the motion to suppress the evidence.
The bill of information was amended on 10 February 2009 to allege attempted possession *1133 of a firearm by a convicted felon. On that same day, Patterson entered a guilty plea to both counts under State v. Crosby, 338 So. 2d 584 (La.1976), thereby preserving his right to appeal the trial court's denial of his motion to suppress evidence. The trial court sentenced Patterson to serve three years imprisonment for the violation of La. R.S. 14:95.1, and five years imprisonment for the violation of La. R.S. 40:967(F)(1). This timely appeal followed.
Officer Victor Gant testified that on 31 August 2007, he was assigned to the New Orleans Police Department Fifth District task force. On that day, a concerned citizen entered the police station during roll call to make a complaint regarding several individuals distributing narcotics out of what the complainant described as an abandoned dwelling located at 3239 Metropolitan Street in New Orleans.
The members of the task force unit formulated a course of action to investigate, which involved Officer Gant conducting surveillance of the location. Officer Gant related that from his surveillance position he observed five unknown black males standing in front of the location. He observed that the structure, and apparent residence, displayed considerable hurricane damage. The building had been gutted and had no windows or doors. A trailer was located on the front lawn of the property as well.
After approximately twenty minutes of surveillance, Officer Gant observed Patterson enter a green Lincoln LS automobile parked at the location.[1] Patterson exited the vehicle shortly after entering. Officer Gant could see that he was carrying a black object in his hand. Patterson walked towards the residence and just before entering, Officer Gant observed that Patterson was carrying a Tech-9 semi automatic pistol with an extended magazine in his hand.
Patterson emerged empty handed from the residence shortly thereafter. Officer Gant alerted other members of the task force of his observations and advised them to detain the defendant. Officer Gant discontinued his surveillance, relocated to the scene, and entered the building. To the right of the first room inside the building, he observed a white pillow on the floor with a few small tools in the area. He lifted the pillow and discovered the Tech-9 he had observed Patterson take into the building.
A criminal records check revealed that Patterson had only recently been released from probation after being convicted of possession of cocaine. The defendant was then arrested for possession of a weapon by a convicted felon. Patterson was searched and approximately sixty-one grams of cocaine and $361.00 in small bills were recovered from him.
The owner of the residence, Jane Knopp, arrived on the scene after Patterson's arrest. She advised Officer Gant that no one had permission to be inside the residence and that she had made several complaints about people hanging out in front of her location. Ms. Knopp was living in the trailer located on the property. She told Officer Gant that she was in fear for her life, and that when she would tell the subjects to leave, they would come right back.
Officers searched the Lincoln LS automobile parked at the location and recovered marijuana. Another individual, who had been observed distributing the marijuana from the vehicle, was arrested. Another individual was also arrested in conjunction with narcotics activity observed at the location.
*1134 Ms. Knopp testified that the she knew Patterson as his family had been a tenant of hers in 2003 or 2004 and that afterwards he began working for her. She testified that she was not in New Orleans on the day in question and consequently could not have spoken with Officer Gant. She stated that she was in Mississippi on that day. She related that she ceased living on the trailer in August 2009.
Errors Patent
Our review of the record reveals two patent errors.
Patterson was convicted of possession of cocaine in an amount of twentyeight grams or more, but less than two hundred grams, a violation of La. R.S. 40:967 F(1)(a) that provides for a mandatory fine of not less than $50,000.00, nor more than $100,000.00. In sentencing the defendant, the trial court did not impose a fine as mandated. This court has decided that the failure to impose a mandatory fine requires that the matter be remanded for the imposition of that fine. State v. Williams, 03-0302, p. 3 (La.App. 4 Cir. 10/6/03), 859 So. 2d 751, 753, following State v. Legett, 02-0153, pp. 3-4 (La.App. 4 Cir. 5/22/02), 819 So. 2d 1104, 1106, and State v. Hall, 02-1098, pp. 5-6 (La.App. 4 Cir. 3/19/03), 843 So. 2d 488, 494.
A second patent error in the sentence concerns the trial court's failure to prohibit parole as mandated by La. R.S. 14:95.1.[2] However, La. R.S. 15:301.1 A provides that in instances where the statutory restrictions are not recited at sentencing, they are contained in the sentence, whether or not imposed by the sentencing court. State v. Williams, 00-1725, p. 10 (La.11/28/01), 800 So. 2d 790, 798-99. Hence, this court need take no action to correct the trial court's failure to specify that Patterson's sentence be served without benefit of parole, probation, or suspension of sentence. The correction is statutorily effected. La. R.S. 15:301.1 A.[3]
Assignment of Error
Patterson contends that the trial court erred when it denied his motion to suppress the evidence suggesting that the evidence was obtained in violation of the United States and Louisiana Constitutions. Specifically, he contends that the Tech-9 should have been suppressed as Officer Gant possessed neither a warrant nor consent to search the building located at 3239 Metropolitan Street. Noting that the mere possession of a weapon is not prohibited by law, he contends that no probable cause existed to believe that he had committed a crime and that no argument could be raised to suggest that exigent circumstances precipitated Officer Gant's warrantless entry into the structure.
He also contends that the evidence that was recovered from his person, the cocaine and U.S. currency, should also have been suppressed. Patterson contends that because his arrest was predicated by the recovery of the weapon in an illegal search, then the evidence obtained in the search incident to his arrest should also have been suppressed as it was tainted by the earlier warrantless search conducted at 3239 Metropolitan Street.
The Fourth Amendment protects "the right of the people to be secure in their . . . houses . . . against unreasonable searches and seizures." U.S. Const. amend. IV. "At the very core [of the *1135 Fourth Amendment] stands the right of a man to retreat into his own home and there be free from unreasonable governmental intrusion." Silverman v. United States, 365 U.S. 505, 511, 81 S. Ct. 679, 683, 5 L. Ed. 2d 734 (1961). Similarly, the Louisiana Constitution protects the right of every person "to be secure in his person, property, communications, houses, papers, and effects against unreasonable searches, seizures, or invasions of privacy." La. Const. Art. I, § 5. A search or seizure conducted without a warrant issued upon probable cause is per se unreasonable, unless justified by a specific exception to the warrant requirement. Katz v. United States, 389 U.S. 347, 357, 88 S. Ct. 507, 514, 19 L. Ed. 2d 576 (1967); State v. Moreno, 619 So. 2d 62, 65 (La.1993).
Initially, because of the circumstances involving Patterson's presence at 3239 Metropolitan Street, the question arises whether he has standing under either state or federal law to contest the admissibility of the weapon that was seized by Officer Gant when he searched the front room of the building. The state contends he does not because he lacked any reasonable expectation of privacy over his personal property at 3239 Metropolitan Street both because of the condition of the property and because he had no ownership interest in the property.
In State v. Owen, 453 So. 2d 1202 (La. 1984), the Court explained how an individual's standing to challenge a violation of privacy is treated differently by our state and federal constitutions as follows:
The federal jurisprudential rule is that one has standing only if the search or seizure allegedly violated the defendant's own constitutional rights; and, the defendant's fourth amendment rights are violated only when the challenged conduct invaded the defendant's reasonable expectation of privacy rather than that of a third person. United States v. Salvucci, 448 U.S. 83, 100 S. Ct. 2547, 65 L. Ed. 2d 619 (1980); Rakas v. Illinois, 439 U.S. 128, 99 S. Ct. 421, 58 L. Ed. 2d 387 (1978); Alderman v. United States, 394 U.S. 165, 89 S. Ct. 961, 22 L. Ed. 2d 176 (1969). However, under La. Const. art. 1[sic], § 5 as interpreted by this court, "any person adversely affected" by a search or seizure allegedly conducted in violation of art. 1[sic], § 5 has standing to raise that illegality. There is no equivalent under Louisiana constitutional law to the federal rule that one may not raise the violation of a third person's constitutional rights. State v. Hebert, 351 So. 2d 434 (La.1977) (on rehearing); State v. Culotta, 343 So. 2d 977 (La.1976).
Id. at 1205. See also State v. Perry, 502 So. 2d 543, 558 (La.1986) ("The Louisiana Constitution does not limit standing to challenge a search to those who live in the premises and thus have a reasonable expectation of privacy in it.").
Accordingly, although it is safe to say that Patterson lacked a reasonable expectation of privacy over his property at 3239 Metropolitan Street, he nevertheless has standing to contest the legality of the search.[4] However, the propriety of the trial court's ruling denying Patterson's motion to suppress the evidence is not entirely resolved by answering the question of his standing.
In State v. Walker, 06-1045 (La.4/11/07), 953 So. 2d 786, the Court confronted a set of circumstances whereby the defendant's rights under the Louisiana Constitution were unaffected by the warrantless entry into a home of a third person and subsequent apprehension of him. In Walker, the police were chasing the defendant *1136 when he fled into the home of a third person. Unbeknownst to the officers, the owner had previously informed the defendant that he was not allowed in her home. The defendant was apprehended inside the home, and narcotics which he discarded were recovered. The Court found that even though the Louisiana Constitution allows a defendant to raise the violation of a third person's privacy interests, no legitimate purpose would be served by suppressing the evidence seized after the warrantless entry into the house by permitting the defendant to assert a third party's privacy interests, which he had himself violated. Id. at p. 8, 953 So.2d at 791.
Here, Officer Gant testified that Ms. Knopp stated to him that no one had permission to be inside the residence, that she had made several complaints about subjects hanging out in front of her property, and that she was in fear of the subjects because she would tell them to leave and they would just come right back.
We acknowledge that Ms. Knopp's testimony was in conflict with Officer Gant's, it is clear that the trial court believed the officer in ruling as it did. Furthermore, regardless of whether Patterson was known to Ms. Knopp, nothing suggests that she consented to the use of her residence, its condition notwithstanding, for the purpose of keeping a weapon by Patterson or any other person.
In State v. Stephens, 40,343 (La.App. 2 Cir. 12/14/05), 917 So. 2d 667, another case presenting similar issues, the court refused to exclude evidence that was legitimately seized under the Fourth Amendment but whose seizure was in violation of the Louisiana Constitution.
In Stephens, the defendant was apprehended hiding in the carport at the home of another. Subsequently, the police entered a screened porch at the front of the residence and searched a backpack where they located narcotics. The court concluded the search was an unconstitutional infringement of the homeowner's rights and ruled that the defendant had standing to challenge the illegality of the search, even though he had no expectation of privacy in the backpack. The court examined two cases decided by the Louisiana Supreme Court where the court had not rigidly enforced Louisiana's standing provision and concluded that exclusion of the evidence under the circumstances of the case was not mandated. The court stated:
In this case, we find that the illegality of the search does not require the imposition of the exclusionary rule under these unique facts. The entry of the police upon the porch was into a place at the residence where some degree of intrusion was expected by the homeowner. The property which was involved in the search, like the search in [State v.] Barrett, [408 So. 2d 903 (La.1982)] turned out not to be the property of a third party homeowner. There was some basis, given the backpack's proximity to defendant, to consider that the bag was the defendant's abandoned property. Last, while in a larger sense the search took place under circumstances requiring a search warrant, the homeowner's privacy was not in fact violated since the record neither reflects that the owner was ever aware of the police presence on the porch or that any property of the owner was rummaged or seized. Thus, in this case, where the actual intrusion experienced by the homeowner does not even compare to that experienced by the homeowner in Barrett, who witnessed Barrett's arrest during the unauthorized entry of the home, the deterrence from the exclusionary rule, which is marginal at best, should not outweigh the search for the truth involving the charged offense. We therefore find the application of the exclusionary rule unwarranted.
*1137 Stephens, 40,343, at pp. 12-13, 917 So.2d at 676.
As minimally invasive upon the homeowner's rights as the search in Stephens was, Officer Gant's entry into the open and vacant structure on Metropolitan Street and subsequent recovery of the firearm from underneath the pillow, represents even less of an intrusion upon Ms. Knopp's privacy rights.
Accordingly, under the reasoning adopted by the Second Circuit in Stephens, this court likewise declines to exclude the firearm under the facts of this case.
Additionally, two Louisiana courts under facts similar to those presented here have effectively found that when a defendant relinquishes control over or otherwise abandons property in a constitutionally protected area, the property may be seized without a warrant.
In State v. Harper, 27,278, p. 17 (La. App. 2 Cir. 8/23/95), 660 So. 2d 537, 547, the defendant concealed a gun used in the commission of a crime by wrapping it in a shirt and in placing it in some tall grass in his neighbor's back yard. The police searched the yard and recovered the gun without a warrant. The court concluded that the search was permissible because the gun had been abandoned, stating, "[w]hen property has been abandoned, a person's property interest in it lapses, and there is no further reasonable expectation of privacy, so property may be searched and seized without normally requiring a search warrant."
Similarly, in State v. Fielding, 37,943, p. 15 (La.App. 2 Cir. 12/10/03), 862 So. 2d 420, 430, during a homicide investigation, police officers were informed that the defendant, who had become a suspect, frequently stayed in one of several abandoned houses near the scene of the crime. Also, a friend of the defendant informed the officers that the defendant possessed a pistol that could possibly be found in one of the abandoned houses. Acting on the information, the police began a search of the abandoned houses in the area and found the murder weapon hidden between a cushion and the back of a recliner.
Citing Harper, among other cases, the court found that probable cause existed to search the houses and that the trial court had properly denied the motion to suppress the evidence because the defendant left the gun in an abandoned house that did not belong to him.
For the foregoing reasons, we find that the trial court properly denied Patterson's motion to suppress the evidence with respect to the gun recovered by Officer Gant.
Because the trial court properly denied Patterson's motion to suppress with respect to the gun, the motion was also properly denied with respect to the evidence recovered incident to Patterson's arrest. (We note that regardless of the disposition of the gun, the evidence recovered from Patterson was nevertheless admissible.)
From the testimony, it is clear that the police had a reasonable suspicion to detain Patterson under the belief that he may have been engaged in narcotics trafficking. See La.C.Cr.P. art. 215.1; State v. Temple, 02-1895, pp. 4-5 (La.9/9/03), 854 So. 2d 856, 859-60. Acting on the initial complaint, Officer Gant confirmed one aspect of the reported observations of the concerned citizen who had contacted the officers at the precinct earlier that day when he observed several unknown individuals standing about in front of the vacant and hurricane damaged residence. Additionally, narcotics trafficking activity emanating from the vehicle was also observed, further confirming the complaint. These observations led to the arrest of two other subjects from the location. When Officer Gant observed Patterson transporting the Tech-9 semi-automatic *1138 pistol from the automobile into the vacant house, he had the requisite reasonable suspicion to further his investigation by stopping the defendant. Having observed Patterson with the gun, a criminal background check would have created probable cause to arrest Patterson for being a felon in possession of a firearm. Incidental to that arrest, he could search the defendant and lawfully seize the cocaine. State v. Parker, 06-0053, p. 3 (La.6/16/06), 931 So. 2d 353, 355.
Conclusion
For the foregoing reasons we affirm Patterson's convictions; however, we remand this case to the trial court for imposition a fine as required by La. R.S. 40:967 F(1).
CONVICTIONS AFFIRMED: REMANDED FOR IMPOSITION OF FINE.
NOTES
[1] It was subsequently determined that the vehicle was registered to Patterson.
[2] La. R.S. 14:27 provides that the sentence shall be imposed "in the same manner as for the offense attempted."
[3] Although La. R.S. 14:95.1 also calls for a mandatory fine, La. R.S. 14:27 only prescribes a penalty of not over one-half of the maximum fine. No minimum fine is mandated.
[4] The trial court concluded that Patterson had no reasonable expectation of privacy over the gun at the residence, and Patterson does not challenge that conclusion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2456144/ | 493 S.W.2d 569 (1973)
C. Wesley HAMMONDS, Appellant,
v.
David Leslie ROPER et al., Appellees.
No. 748.
Court of Civil Appeals of Texas, Corpus Christi.
April 5, 1973.
Rehearing Denied April 26, 1973.
*570 Mahoney, Shaffer, Hatch & Layton, Charles W. Zahn, Jr., Corpus Christi, for appellant.
Robert L. Joseph, Sinton, for appellees.
OPINION
NYE, Chief Justice.
This is a suit involving a dispute over the ownership of a horse. The plaintiff, C. Wesley Hammonds, originally owned a horse by the name of "Miss Barbara". In 1967 the horse in question hurt her foot. The plaintiff alleged that David Leslie Roper and his son, Scott Roper, (both defendants) were called upon by him to take care of the horse. In 1971, four years later, plaintiff demanded the return of the horse. The defendants refused, contending that plaintiff gave the horse to the defendant Scott Roper. One issue was submitted to the jury which found that plaintiff had made a gift of the horse to Scott Roper. It is from this adverse verdict and judgment that the plaintiff appeals.
The evidence is conflicting. Apparently, in 1967, after the horse in question had sustained a serious injury to her foot, the plaintiff turned over the possession of the horse to Scott Roper. At that time, according to the evidence the horse was worth less than $100.00. During the ensuing four years, after young Scott had obtained possession of the mare, he nursed *571 her back to health, trained her for roping, dogging, for showing, for pulling a buggy, for running the barrels and poles, and to be a top-notch riding horse. It was undisputed that the mare's value increased. The plaintiff alleged at the time he made demand for the return of the mare that she was worth at least $2,500.00.
According to the plaintiff's theory of the case, he loaned the horse to the defendant Scott Roper with the understanding that he could use the horse as long as he took care of it. The defendants, father and son, contended that the plaintiff made an outright gift of the horse to young Scott Roper in 1967.
Plaintiff's first four points of error complain of the trial court's special issue and the resulting judgment for the reason that there were no pleadings to support the special issue or the judgment. Plaintiff plead that he turned over the use of the mare to the defendants because the defendants had requested that they be permitted to use the mare "Miss Barbara" in connection with the boy's 4-H Club work. Plaintiff contended that the mare was used by the son Scott Roper in accordance with their understanding and agreement. Plaintiff argues that any gift was conditional and defendants' own pleadings substantiate this fact. Therefore, no legal gift was ever perfected. In 1971 plaintiff demanded the return of the mare from the defendants, which demand was refused. The defendants answered plaintiff's suit with a general denial. Subject to the general denial, they plead a cross-action for damages. The pertinent part of the defendants' pleading reads as follows:
"(2) Pleading further in the alternative, the Plaintiff, C. WESLEY HAMMONDS, gave the horse, commonly known as `Miss Barbara,' to SCOTT ROPER just after the horse was seriously cut by a barbed wire and promised that the horse would belong to SCOTT ROPER if he would take care of the horse. (Emphasis supplied.)
(3) Plaintiff's C. WESLEY HAMMOND'S, words and actions led the Defendants to believe that the horse had been given to SCOTT ROPER. The Defendants never dreamed that C. WESLEY HAMMONDS would later try to claim that the horse was still his or demand that it be returned to him. The Defendants relied upon the representations of the Plaintiff, cared for the horse, trained the horse, possessed and treated the horse as if it were their own, believing, in fact, that it did belong to SCOTT ROPER.
* * * * * *
WHEREFORE, Defendants pray that Plaintiff take nothing by his suit; that the Court order that said horse be returned to the Defendants and be declared to be the property of SCOTT ROPER ... And for such other and further relief, at law and in equity, to which Defendants may show themselves justly entitled."
The plaintiff answered defendants' cross-action denying that any gift had taken place. The plaintiff's pleading in part was as follows:
"Plaintiff denies that he at any time either by expression, word or action, informed or told Defendants, or either of them, or anyone else, that he would give or sell the horse to them, or either of them, or to anyone else. On the contrary, the horse in question was specifically trained for Plaintiff because of Plaintiff's physical impairments."
The entire case was tried before the jury on the disputed theory that the plaintiff had made a gift of the mare to young Scott Roper. The plaintiff did not file any special exceptions or objections to Scott Roper's pleadings. The plaintiff contends, however, that the pleadings of the defendants were insufficient in that they did not actually set up the defense of an outright gift; that the pleadings were insufficient to support an issue of a gift because by their own admission the mare *572 was conditionally given to the defendants; the condition being, that Scott Roper could have the horse "if he would take care of the horse." We disagree.
The general rule is that the pleadings shall be liberally construed. Where a defendant has plead a general denial, he may prove anything thereunder which tends to show that the plaintiff's allegations are untrue. Here the plaintiff claimed ownership of the horse. The test that is applied is if the matter that the defendant seeks to assert as a defense injects a new issue into the case not raised by the pleadings, it must be specially pleaded in order to render evidence in support thereof admissible. Where a defendant desires to introduce evidence of a fact that does not tend to rebut the facts of the plaintiff's case but shows an independent reason why the plaintiff should not recover on the case stated and proved by him, then the defendant must first plead the facts that will avoid the legal consequences of the plaintiff's case. Otherwise, the evidence will not be admissible and a judgment rendered on that evidence cannot be sustained. 45 Tex.Jur.2d, Physicians and Other Healers § 60-62; 38 C.J.S. Gifts § 64.
Here there is an action by plaintiff to recover property allegedly belonging to the plaintiff. Plaintiff's case is based on his superior right and title to the horse. Defendant may, under a general denial, and under the pleadings hereinabove quoted, prove that the horse was his, that a gift of the horse was made by plaintiff to him. There was no surprise by the defense offered. There was no objection by the plaintiff to the evidence introduced by the defendants. The plaintiff offered no exceptions to the defendants' pleadings. No exceptions were filed to make more certain any of the elements of the gift.
The Supreme Court of Texas has set forth the following requirements for an inter vivos gift:
"... The courts sustain the rule that to constitute a gift inter vivos there must be a delivery of possession of the subject matter of the gift by the donor to the donee, and a purpose on the part of the donor to vest in the donee, unconditionally and immediately, the ownership of the property delivered...." Wells v. Sansing, 151 Tex. 36, 245 S.W.2d 964 (1952).
Based on this law the learned trial judge correctly submitted a single issue with the accompanied instruction which was as follows:
"ISSUE NO. 1
Do you find from a preponderance of the evidence that the Plaintiff Hammonds made a gift of the horse Miss Barbara to the Defendant Scott Roper?
Answer `He did' or `He did not'.
We, the Jury, answer: HE DID.
You are instructed in connection with Issue No. 1 in order for there to have been a gift of the horse by Hammonds to Scott Roper there must have been a delivery of possession of the horse by Hammonds to Scott Roper, with the intention on the part of Hammonds to vest the ownership of the horse in question in defendant, Scott Roper, immediately and unconditionally; and an acceptance of the horse by Scott Roper."
We hold that the pleadings of the defendants (absent special exceptions) were sufficiently broad to apprise the plaintiff of the defendants' ground of defense and sufficient to raise the issue of an inter vivos gift that was placed before the jury. Appellant's points one through four are overruled.
Plaintiff-appellant in his fifth, sixth and seventh points complain that there was no evidence to support the judgment of the court.
Under a no evidence contention, the fundamental principle of appellate review is that the record must be viewed in *573 the light most favorable in support of the judgment of the trial court and jury verdict. The appellate court must consider only the evidence and the inferences tending to support the finding of the jury, disregarding all evidence and inferences to the contrary. Garza v. Alviar, 395 S.W.2d 821 (Tex.Sup.1965); Fisher Construction Co. v. Riggs, 160 Tex. 23, 325 S.W.2d 126 (1959).
On one occasion, a witness, Mr. Horace Ridens, overheard a conversation that Mr. Hammonds (the plaintiff) had relative to the horse in question:
"Q Did you hear him (plaintiff) talk about the horse?
A Yes Sir.
Q What did he say?
A He said he was glad to see that the mare, that Scotty had made something out of the mare that he had given him."
Defendant David Leslie Roper testified as follows:
"Q Did you have occasion at your supper table to discuss the horse with Mr. Hammonds after she had her foot cut?
A Mr. Hammonds, during the course of conversation mentioned the fact that he didn't want the mare taken back to his place and take a chance on being hurt real, real bad and as long as Scotty could take care of her and care for her he could have her and if he ever wanted to sell her to contact him."
At another point in the record defendant Roper testified as to a conversation he had with the plaintiff Hammonds:
"Q Tell the jury what you recall happened that day.
A There was a rule in 4-H that in the event a question comes up pertaining to ownership of a horse that you must be able to produce legal ownership and since this mare had been a gift, well there were no papers or legal ownership and I went to him and asked him if he would give me the papers that would show legal ownership so the boy could show her in these A and H shows and he readily assured me that I did not need anything in writing that his word was good enough."
Another witness, Barbara Tipps, testified as follows:
"Q And you recall having a conversation with Mr. Hammonds after Miss Barbara cut her foot, about Miss Barbara?
A Yes sir, he told me he didn't think Miss Barbara would be able to be ridden any more and he was going to let Scott Roper have her because he thought he would care for her regardless of whether she could be ridden again or not."
Young Scott Roper (the defendant) testified unequivocably that the horse was given to him by the plaintiff Mr. Hammonds:
"Q And what did he (the plaintiff) say to you at that time Scotty?
A Mr. Hammonds told me, he said, the horse is yours, I don't want it back, but if you ever want to sell her or get rid of her contact him first and that's his words that he told me.
Q And did you then continue to take care of and nurse Miss Barbara after that?
A Yes, sir."
Although the plaintiff's points of error might possibly be construed as complaining of factually insufficient evidence even though they use the words "no evidence" throughout, we would hold nevertheless in such case, that the evidence was sufficient to support the jury's verdict. *574 See Calvert, "No Evidence" and "Insufficient Evidence" Points of Error, 38 Tex. L.Rev. 359 (1960). Appellant's points five, six and seven are overruled.
Judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614022/ | 331 N.W.2d 578 (1983)
In the Matter of the ESTATE OF Lawrence MAY, Deceased.
No. 13878.
Supreme Court of South Dakota.
Considered on Briefs February 15, 1983.
Decided March 30, 1983.
David R. Gienapp of Arneson, Issenhuth & Gienapp, and Carl E. Bohn, Madison, for appellants First Northwestern Trust Co. and William Doblar.
*579 John Dewell, Asst. Atty. Gen., Pierre, for appellee South Dakota Dept. of Revenue.
HENDERSON, Justice.
ACTION
Decedent Lawrence May died on February 17, 1981. Appellant William Doblar, a nephew of decedent, was an heir under decedent's will of property valued at $297,475.41. When the South Dakota Inheritance Tax return was filed, appellant requested classification as decedent's son for tax purposes pursuant to SDCL 10-40-23(3). Appellee South Dakota Department of Revenue refused to grant appellant's requested exemption as a son. First Northwestern Trust of South Dakota, the executor of the estate, requested a hearing on the tax assessment. After a March 12, 1982, hearing, the trial court found the relationship between appellant and decedent did not comport with SDCL 10-40-23(3) and entered judgment in favor of appellee establishing a tax and determining appellant, for tax purposes, was not a son. We affirm.
FACTS
In 1939, appellant, at age eight, began staying with decedent during the week apparently because the roads were in poor condition near appellant's father's residence and decedent could insure that appellant attended school in Madison, South Dakota. This arrangement continued until 1945. During appellant's stay with decedent, testimony established that decedent financed appellant's room and board and helped raise the boy. Appellant's tuition was paid by his father, and appellant would go home on weekends to be with his family.
In 1945, appellant, age fourteen, moved home and entered a public high school. Appellant left school after one year. From 1945 to 1952, appellant worked in Madison and also for decedent. Appellant would stay at decedent's home from time to time. Appellant married in 1953, then entered the army for four months. After his army service, appellant returned to live and work on decedent's farm where appellant remained until decedent's death. Appellant and decedent engaged in a farming enterprise and had an extremely close relationship as uncle and nephew. In decedent's will, appellant was referred to as "my beloved nephew."
ISSUE
DID THE TRIAL COURT ERR IN CONCLUDING THAT APPELLANT DID NOT STAND IN A MUTUALLY ACKNOWLEDGED RELATION OF PARENT WITH THE DECEDENT PURSUANT TO SDCL 10-40-23(3)?
DECISION
We have yet to construe SDCL 10-40-23(3) which provides:
The following exemptions from the tax are hereby allowed:
* * * * *
(3) Property of the clear value of thirty thousand dollars transferred to each of the lineal issue of the decedent, or any child adopted as such in conformity with the laws of any state, or any child to whom the decedent for not less than ten years prior to such transfer stood in mutually acknowledged relation of a parent, if such relationship began at or before the child's fifteenth birthday and was continuous for ten years thereafter, or any lineal issue of such adopted or mutually acknowledged child[.]
New York's Collateral Inheritance Tax Act, 1885 N.Y.Laws ch. 483, as amended 1887 N.Y.Laws ch. 713; and 1892 N.Y.Laws § 2 ch. 399 provides the genesis for SDCL 10-40-23(3). Our statute builds upon its New York origins by requiring that the mutually acknowledged parent relationship begin before the claimant's fifteenth birthday and be continuous for ten years thereafter. For the exemption to apply, the relationship must be generally understood and acknowledged to be that of parent and child. In re Moulton's Estate, 11 Misc. 694, 33 N.Y.S. 578 (1895).
*580 In re Beach's Estate, 154 N.Y. 242, 245, 48 N.E. 516, 518 (1897), provides an early interpretation of the "mutually acknowledged parent" requirement:
The clause, we think, was intended to have a broader scope; to include, among others, those cases, not infrequent, where a person without offspring, needing the care and affection of some one willing to assume the position of a child, takes, without formal adoption, a friend or relative into his household, standing to such person in loco parentis or as a parent, and receives, in return, filial attention and service.
Both the decedent and claimant must view the relationship as that of parent and child. Estate of Wilts, 80 Cal.App.3d 599, 145 Cal.Rptr. 759 (1978). Objective factors that have been used to make a determination if the relationship exists include: a) A relationship by blood or marriage; b) The reception of the child into the home and treatment of the child as a member of the family; c) An assumption of responsibility for support beyond occasion of gifts and financing aid; d) An exercise of parental authority in discipline; e) Advice and guidance to the child; f) A sharing of time and affection. Estate of Wilts, 145 Cal.Rptr. 759. A sufficient relationship for the exemption does not arise by chance but is an intentional assumption by the decedent of the parent's role in providing for the child. In re Teddy's Estate, 214 Cal. App.2d 113, 29 Cal.Rptr. 402 (1963).
We do not hesitate to conclude that decedent and appellant remained close throughout decedent's life. The trial court found "Lawrence May and William Dobler lived, worked and played together and there existed a close relationship between the Uncle and the Nephew." SDCL 10-40-23(3) requires more than closeness. After reviewing the record and testimony below, we are unable to hold that appellant and decedent remained in a mutually acknowledged parent and child relationship for ten continuous years. The trial court did not err in its ruling.
Affirmed.
All the Justices concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614038/ | 331 N.W.2d 505 (1983)
213 Neb. 715
STATE of Nebraska, Appellant,
v.
James E. LEVERING, Appellee.
No. 82-438.
Supreme Court of Nebraska.
March 11, 1983.
*506 Donald L. Knowles, Douglas County Atty., S.W. Cooper, Omaha, and Charles Campbell, York, for appellant.
Thomas M. Kenney, Douglas County Public Defender, and Michael F. Gutowski, Asst. Public Defender, Omaha, for appellee.
KRIVOSHA, C.J., BOSLAUGH, McCOWN, WHITE, HASTINGS, and CAPORALE, JJ., and MORAN, District Judge.
HASTINGS, Justice.
This is a proceeding in error under Neb. Rev.Stat. § 29-2315.01 (Reissue 1979). Its purpose is to review the orders of the District Court in suppressing the testimony of the alleged robbery victim, Donald Playfoot, and of Deputy Sheriff Linda Valencia, in proceedings preliminary to trial. The defendant, James E. Levering, was charged with an August 24, 1981, robbery in Omaha. The State assigns as error the suppressing of the posthypnotic testimony of the victim, as well as his testimony as to those events recalled and recorded prior to the hypnotic session. No error is assigned in suppressing the testimony of the deputy sheriff, although we will be required to discuss her testimony in order to resolve this appeal.
According to the victim's testimony, on August 24, 1981, his home in Omaha was entered by three black males who robbed him of property of value. After the robbers left he reported the incident to the Douglas County sheriff's department, and they sent Linda Valencia to take his report. As part of the suppression hearing, the State offered the testimony of Deputy Valencia as to what the victim had reported, as well as the written report itself, all of which were rejected by the court as hearsay. An offer of proof was made in the nature of the deputy sheriff's report itself, which was also rejected.
That report, dated August 24, 1981, contained a rather detailed description of the robbery of the victim. In addition, Deputy Sheriff William W. Black took a supplemental report from the victim on that same date, which was testified to by the officer at a suppression hearing. In that report the victim was quoted as saying that at approximately 12:30 a.m. he was reading in bed when he and his wife became aware of the presence of three armed, black males. He described in some detail the instructions given him by these intruders, including their demand that he show them where his money was located. During the remainder of the time while these three men were ransacking the house, he recalled the repeated demands made upon him not to look at their faces. He detailed the various items of property taken, then described the three men to the deputy sheriff as to age, height, and build, and in some instances furnished other characteristics of the alleged robbers.
The victim himself testified that on August 28, 1981, at the request of the sheriff's department, he was subjected to a hypnotic interview. According to the testimony of Dr. George Bartholow, a licensed psychiatrist familiar with the use of hypnosis, he believes hypnosis to be a valuable tool in order to enhance and refresh memory. It was his opinion that the deputy sheriff who conducted the hypnotic interview was qualified to induce a hypnotic state, and from an *507 examination of the recorded interview it was his judgment that the interview conducted with the victim was "excellent," and he saw no examples of leading questions or planting information.
As a result of the hypnotic interview, the victim was able to identify two of the men as having robbed him, one of whom was the defendant. According to the cassette tapes of the hypnotic interview, the facts of the alleged robbery were discussed in great detail, including the fact of the robbery and that it was perpetrated by three black men.
Both parties in their briefs agree that at the trial, held on April 30, 1982, neither the testimony of the victim nor of the deputy sheriff who took his initial report was permitted because of the suppression orders under consideration here. Also, a defense motion to dismiss due to insufficiency of the evidence was sustained in spite of the fact that the confession of the defendant was received in evidence.
It is apparent that the trial court sustained the defense motion to dismiss because the State failed to prove the corpus delecti. This could have been proved by testimony of the victim that he was robbed by three black men. That evidence, together with the defendant's confession, undoubtedly could have resulted in the defendant's conviction. That particular testimony of the victim, if permitted, would have related only to matters which he was able to recall and relate prior to hypnosis as to which there was sufficient evidence in the form of the deputy sheriff's report to satisfy the court that such evidence was known and related by the victim prior to hypnosis. That particular testimony should not have been suppressed. See State v. Patterson, 213 Neb. 686, 331 N.W.2d 500 (1983).
We therefore conclude that the orders of the District Court suppressing that evidence were erroneous and the exceptions must be sustained.
EXCEPTIONS SUSTAINED.
WHITE, Justice, dissenting.
For the reasons stated in the dissent in State v. Patterson, 213 Neb. 686, 331 N.W.2d 500 (1983), I dissent.
McCOWN, J., joins in this dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919992/ | 447 N.W.2d 118 (1989)
STATE of Iowa, Appellant,
v.
Charles Garland ANDREWS, Jr., Appellee.
No. 88-1082.
Supreme Court of Iowa.
October 18, 1989.
*119 Thomas J. Miller, Atty. Gen., Roxann M. Ryan, Asst. Atty. Gen., and Paul Martin, County Atty., for appellant.
Raymond E. Rogers, State Appellate Defender, and Peter Persaud, Asst. State Public Defender, for appellee.
Considered by McGIVERIN, C.J., and HARRIS, SCHULTZ, NEUMAN, and SNELL, JJ.
NEUMAN, Justice.
The State has charged defendant Charles Andrews with two counts of lascivious acts with a child in violation of Iowa Code section 709.8(1) and (2) (1987). An earlier trial on these same charges resulted in a hung jury and declaration of mistrial. The case before us concerns pretrial rulings in connection with Andrews' retrial.
The trial court has declared the child victim incompetent to testify, and the court has also refused to allow the State to offer a videotape of the child's prior trial testimony into evidence. We granted the State's application for discretionary review of these pretrial rulings. Finding no abuse of the trial court's broad discretion in such matters, we affirm.
I. Defendant Andrews was charged with lascivious acts after his four-year-old neighbor, Debbie, told a social worker that Andrews had invited her into his apartment where he touched her vagina and prompted her to hold his penis until he "went potty" on her. The defendant challenged Debbie's competence to testify at trial and a hearing on that question was held. Judge Ralph McCartney, who presided at the hearing and conducted much of the questioning, found her competent. His ruling elaborated on his finding as follows:
Debbie is clearly a non-verbal child, not particularly loquacious. And it could be, of course, the surroundings in which she finds herself.
She was able to distinguish on some questions what was the truth and what was a lie; i.e., colors, number of fingers held up by the Court, the color of the walls, I believe.
And I was somewhat more ill at ease with her commitment to tell the truth.
But taking the thing by the four corners, including [the social worker's] testimony and my own observation of the little girl, I am reasonably satisfied that she would tell things in a generally truthful way.
The State also filed a motion for closed-circuit televised testimony pursuant to Iowa Code section 910A.14(1) in order to permit Debbie to testify outside the presence of the defendant. The court granted the motion based on Debbie's "tender years," the courtroom's "strange surroundings," and the court's unwillingness "to have her in the courtroom with 13 jurors, 2 bailiffs and the Defendant present." The trial proceeded in accordance with the judge's rulings. The jury was unable to reach a unanimous verdict and a mistrial was declared.
A new trial was scheduled sixty days later before Judge Paul W. Riffel. Andrews renewed his objection to Debbie's competency. A second competency hearing was held which included the testimony of Debbie, her mother, Kenneth Zimmerman (the social worker who had first interviewed Debbie), and a psychiatrist called by the defense, Dr. William Erickson.
Following this second competency hearing, Judge Riffel found that Debbie lacked the competency to be a witness, ruling as follows:
The child has shown an inability to formulate intelligent answers or communicate impressions and recollections regarding the incidents at issue. She was unresponsive to simple, straightforward questions put to her during her interview with Zimmerman, at trial and at the competency hearing. The questions to which she has responded have generally been forced choice questionsdid he do this or did he do that. She did not verbalize any independent recollection or details surrounding the alleged incidents.
*120 In view of the court's ruling, the State moved to have Debbie's prior videotaped trial testimony admitted as evidence pursuant to Iowa Rule of Evidence 804(b). The court denied the motion on two grounds: (1) that the child was not "unavailable" as a witness for purposes of rule 804, and (2) that in the absence of a particularized finding of need, use of the videotape violated the defendant's right of confrontation under Coy v. Iowa, 487 U.S. , 108 S.Ct. 2798, 101 L.Ed.2d 857 (1988).
II. The State charges the trial court with having abused its discretion with regard to these determinations of witness competency and admissibility of evidence. First, it cites error in the court's reconsideration of a witness's competency once a finding of competency has been made; second, it challenges the merits of the court's competency decision; and, third, it attacks the court's refusal to admit the child's videotaped trial testimony under rule 804.
Our review of such rulings is strictly circumscribed. We will not reverse unless it is demonstrated that the court's broad discretion has been abused; that is, that the ruling is clearly untenable and without reason. State v. Brotherton, 384 N.W.2d 375, 377 (Iowa 1986); Calvert v. State, 310 N.W.2d 185, 187 (Iowa 1981); State v. Buck, 275 N.W.2d 194, 195 (Iowa 1979). With this standard in mind, we consider the issues on review.
A. Reconsideration. The State argues that a competency determination, once made, should not be subject to modification absent proof of a change in circumstances requiring re-examination of the witness. Such a rule, the State argues, is needed in order to strengthen the presumption of competency of child witnesses and thereby reduce unnecessary trauma suffered by child victims. By way of resistance, the defendant argues that the State has not only failed to preserve error on this issue, it has cited no authority for its proposition.
The defendant has a strong argument on the preservation question. The record clearly suggests that the county attorney conceded, rather than resisted, the defense request that Debbie's competency be reassessed prior to the second trial. Although the prosecutor's show of cooperation creates a technical obstacle for the State on appeal, we think his response was consistent with the letter and spirit of Iowa Rule of Evidence 601.
The rule calls for intervention by the court "[i]f the child's competency is questioned." Iowa R.Evid. 601. No temporal limitation on the court's action appears. Though a witness's change in status from competent to incompetent (or the reverse) may be rare during the course of a trial, such change in status is certainly conceivable. Absent a showing of abuse, we see no reason to limit the court's authority to make necessary competency determinations whenever and as often as may be required by the particular circumstances of a case.
Here, Debbie's competency has been a source of ongoing concern for counsel and the court. The transcripts and videotapes submitted with this appeal reveal court and counsels' great difficulty engaging the child in any meaningful dialogue, even at a child's level of communication. We find nothing unreasonable about the trial court's decision to reassess Debbie's present capacity to testify competently by holding a second hearing at defendant's request. The assignment of error is without merit.
B. Competency.
The competency of a person to testify is governed generally by Iowa Rule of Evidence 601. The rule was amended, effective July 1, 1985, to provide that "a child... is presumed to be competent." Iowa R.Evid. 601. If the child's competency is questioned, then the rule requires the court to determine whether
(1) the child is mentally capable of understanding the questions being asked;
(2) the child is able to formulate intelligent answers and communicate impressions and recollections regarding the incident about which the child is to testify; and
(3) the child can understand the responsibility to tell the truth. *121 Id. This three-part test does not materially differ from the traditional measure of a witness's competency: "(1) the mental capacity to understand the nature of the questions put and to form and communicate intelligent answers thereto and (2) the moral responsibility to speak the truth, which is the nature and obligation of an oath." State v. Harvey, 242 N.W.2d 330, 336 (Iowa 1976). We have previously applied this standard to child victims of sexual abuse. See Brotherton, 384 N.W.2d at 377.
In arguing for reversal of the trial court's ruling, the State asserts that the court held her to an adult standard of competency instead of recognizing and accommodating the developmental limitations associated with childhood. The State's argument advances the view held by many child abuse experts that "[a]ge differences in perceptual, memory, and verbal capacities should be taken into consideration in assessing witness competence" Berliner & Barbieri, The Testimony of the Child Victim of Sexual Assault, 40 J.Soc.Iss. 125, 129 (1984). The question is whether the trial court erroneously disregarded the importance of the age factor here. We think not.
Contrary to the State's assertion, the record in this case reveals repeated attempts by everyone involved in these proceedingssocial workers, prosecutors, defense counsel, judgesto relate to Debbie on a four-year-old level. They were largely unsuccessful. As the trial court noted at the first competency hearing, Debbie simply is not a talkative child, even compared with other children her own age. As the case progressed, Debbie's reluctance to communicate became even more pronounced. Whether the questions put to her were concrete and grounded in her experience (How many fingers am I holding up? What color is my shirt?) or clearly too abstract for even most adult minds (Can you give me an example of what the truth is?), Debbie's response became quite predictable: no response.
The State contends that the court should determine a child's competency solely by "whether the child can distinguish truth from lies and whether the child is capable of communicating that knowledge." This proposed standard does not differ markedly from the one articulated in Brotherton, 384 N.W.2d at 377. An essential component is missing, however: the requirement that a child be able to demonstrate a "moral responsibility" to tell the truth. It is this prong of the competency test about which Judge McCartney was uneasy and upon which Judge Riffel disallowed Debbie's testimony. We find considerable evidence in the record to support their concern.
At the competency hearing before Judge Riffel, Debbie was allowed to sit on her mother's lap. She would not verbally answer whether she would tell the truth; instead, she nodded ambiguously in response to the prosecutor's many inquiries. When cross-examined by defense counsel, Debbie refused to respond at all, eventually turning away and burying her head in her mother's shoulder. Later, Debbie's mother testified that she could generally tell when Debbie was lying because she would be "reluctant to look [her] straight in the eye" and would "kind of put her head down."
The State's own witness, social worker Ken Zimmerman, conceded on cross-examination that Debbie was "likely to give people things that are not necessarily the truth." Child psychiatrist William Erickson testified without objection that, in general, four-year-olds feel no moral obligation to speak the truth. Based on his review of Debbie's videotaped testimony and initial investigatory interview, he stated that it was impossible to determine whether or not she was capable of telling the truth because she had "just shut down."
Given this record, we cannot ascribe the State's difficulty in establishing Debbie's competency to some unreasonable standard of adult perception and recollection imposed upon her by the trial court. Under rule 601, competency is measured by four essential capacitiesto understand, to recollect, to communicate, and to be truthful. We can infer from the rule that these skills, when required of a child, are to be *122 measured in accordance with a child's level of perception and intelligence. We are not persuaded that the trial court failed to do so here.
We deplore the fact that crimes of violence and abuse are perpetrated upon children too young to even speak out about them in court. We recognize that accommodation must be made to enable children to testify with as much accuracy as a child can muster, without demanding more. Yet precisely because these crimes are so repugnantand our hearts go out so easily to their young victimswe must insure that the fact finder is weighing testimony that meets a minimum threshold of competency. We cannot say that the trial court abused its discretion in deciding that competency was lacking here.
C. Prior testimony.
Iowa Rule of Evidence 804 provides exceptions to the hearsay rule by allowing the admission of prior statements when the declarant is unavailable as a witness. Because the court disqualified Debbie as a witness based on her incompetency, the State argued that her videotaped testimony from the first trial should be admitted as evidence in the second trial under the "former testimony" exception:
The following are not excluded by the hearsay rule if the declarant is unavailable as a witness:
(1) Former testimony. Testimony given as a witness at another trial or hearing of the same or a different proceeding,... if the party against whom the testimony is now offered ... had an opportunity and similar motive to develop the testimony by direct, cross, or redirect examination.
Iowa R.Evid. 804(b)(1).
The court concluded that rule 804(b)(1) did not apply because Debbie was not "unavailable" as defined by rule 804(a). Moreover, the court held that the admission of the videotape, recorded outside the defendant's presence, would violate the defendant's sixth amendment confrontation right.
Rule 804 provides, in pertinent part, that `[u]navailability as a witness' includes situations in which the declarant
....
(4) is unable to be present or to testify at the trial or hearing because of death or then existing physical or mental illness or infirmity.
Iowa R.Evid. 804(a)(4).
Other jurisdictions have uniformly held that an incompetent child witness is "unavailabile" for the purposes of rule 804. See Haggins v. Warden, 715 F.2d 1050, 1055 (6th Cir.1983); Lancaster v. People, 615 P.2d 720, 723 (Colo.1980); State v. Bellotti, 383 N.W.2d 308, 314 (Minn.App.1986); State v. Bounds, 71 Or.App. 744, 749 n. 1, 694 P.2d 566, 568 n. 1 (1985); State v. Doe, 105 Wash.2d 889, 894-96, 719 P.2d 554, 557 (1986); see also J. Meyers and N. Perry, Child Witness Law and Practice, § 5.27 at 313 (1987 & 1989 Supp.). We agree with the rationale put forth by the Washington Supreme Court in support of this interpretation:
While the concepts of availability and competency do not overlap entirely, it is quite clear that an incompetent child is not available. The term `available' denotes a witness who can be confronted and cross-examined. A child unable to take the stand obviously cannot respond to opposing counsel's questions.
Doe, 719 P.2d at 557 (citation omitted).
In support of a more restrictive view of the term "unavailability," the defendant relies on a cryptic footnote found in State v. Brown, 341 N.W.2d 10, 13 n. 1 (Iowa 1983). There the court observed that "the non-testifying child did not meet the definition of `unavailable.'" See id. As noted by the State, it is unclear from the Brown opinion whether the statement was a fact-specific finding or a general interpretation of rule 804(a). Moreover, our decision in the case turned on the applicability of the "residual or catchall" hearsay exception of rule 804(b)(5), an analysis that presumes a threshold determination of unavailability. Given the uncertainty surrounding the dicta in Brown, and the great weight of authority supporting a contrary view, we do not find Brown controlling on the question.
*123 Even assuming that Debbie meets the definition of unavailability under rule 804, however, the admissibility of her former testimony in a criminal proceeding must still be scrutinized under the sixth amendment's confrontation clause. The clause operates to restrict the range of admissible hearsay in criminal cases in two ways: first, by burdening the State with a "rule of necessity" requiring proof of the declarant's unavailability and, second, by requiring that the out-of-court statement be cloaked with indicia of reliability. Ohio v. Roberts, 448 U.S. 56, 65, 100 S.Ct. 2531, 2539, 65 L.Ed.2d 597, 607 (1980). Reliability can be inferred "without more in a case where the evidence falls within a firmly rooted hearsay exception." Id. at 66, 100 S.Ct. at 2539, 65 L.Ed.2d at 608.
Recently the Court drew an important distinction between the "implicit" hearsay-based exceptions to the confrontation clause described in Ohio v. Roberts and the "explicit" right of face-to-face confrontation guaranteed by the sixth amendment. Coy v. Iowa, 487 U.S. ___, ___, 108 S.Ct. 2798, 2802, 101 L.Ed.2d 857, 864 (1988). Exceptions to the latterif they exist at allwould be allowed "only when necessary to further an important public policy." Id. at , 108 S.Ct. at 2803, 101 L.Ed.2d at 867. Taking the lead from Justice O'Connor's concurring opinion in Coy, this court has since recognized that reasonable protection of child witnesses in sex abuse cases furthers just such an "important public policy" and will be upheld when there is a case-specific finding of necessity. State v. Hoversten, 437 N.W.2d 240, 242 (Iowa 1989); In Interest of J.D.S., 436 N.W.2d 342, 345 (Iowa 1989).
In the present case, the trial court found that the State was unable to overcome either the "unavailability" test or the "case-specific finding of necessity" requirement prompted by the Coy decision. While we think the court erred with respect to its narrow interpretation of "unavailability" under rule 804(a), the error does not benefit the State in light of the court's correct analysis of the Coy obstacle to the admission of Debbie's prior testimony.
As previously noted in this opinion, Debbie's original trial testimony was videotaped outside the defendant's presence in accordance with Judge McCartney's general unwillingness to expose her to the "strange surroundings" of the courtroom. This concern, while commendable, does not address the question of whether the child needed the protection. See Hoversten, 437 N.W.2d at 242 (need for protection demonstrated where child victim of "horrendous and painful" abuse is under treatment for posttraumatic stress syndrome); J.D.S., 436 N.W.2d at 346-47 (court found, based on expert testimony, that child would be "traumatized" by confrontation with defendant.)
Judge Riffel concluded that no special need for protection was demonstrated under this record. We cannot disagree with his conclusion. In support of the need for a shield, the State had argued that Debbie "shut down" when questioned in the presence of the defendant. But as aptly noted by Judge Riffel, Debbie was equally unresponsive to questioning when the defendant and jury were confined to other rooms.
In stark contrast to the potential for psychological harm demonstrated in Hoversten and J.D.S., the record before us contains no evidence from which such inference could be drawn. The child's mother, for example, testified that the child had expressed no fear of the defendant. Dr. Erickson dispelled the notion that fear was prompting Debbie's silence by his testimony that this child was likely to be unresponsive in the presence of any adult. The alleged incident of abuse revealed no evidence of physical injury from which some emotional trauma could be inferred.
Given this record, it appears reasonable to us that the court was "not convinced that the child's failure to respond to questions is attributable to a fear of the defendant." Because the State did not prove the need for protection under Coy, Hoversten, and J.D.S., the court correctly ruled that the admissibility of Debbie's prior testimonyeven if otherwise allowable under rule 804would violate Andrews' sixth amendment *124 right of confrontation. No abuse of the trial court's broad discretion in the admissibility of evidence has been shown. Accordingly, we affirm the ruling of the district court and remand the case for further proceedings.
AFFIRMED AND REMANDED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920010/ | 447 N.W.2d 190 (1989)
TRAIL LEASING, INC., Respondent,
v.
DROVERS FIRST AMERICAN BANK, Petitioner, Appellant.
No. CX-88-1352.
Supreme Court of Minnesota.
November 3, 1989.
R.D. Blanchard, Thomas H. Crouch, Meagher, Geer, Markham, Anderson, Adamson, Flaskamp & Brennan, Minneapolis, for appellant.
Patrick A. Farrell, Elliott B. Knetsch, Grannis, Grannis, Farrell & Knutson, P.A., South St. Paul, for respondent.
Heard, considered, and decided by the court en banc.
OPINION
SIMONETT, Justice.
This case asks whether a bank, defending against a customer's claim of negligence in the handling of its checks, was a holder in due course. We conclude that it was as a matter of law and reverse the court of appeals' decision to the contrary.
Plaintiff-respondent Trail Leasing, Inc., sues defendant-appellant Drovers First American Bank. Trail Leasing alleges Drovers negligently cashed certain checks drawn on plaintiff's checking account at Drovers. The facts are stipulated.
Over a period of about 2½ years, Pamela Haas, employed as an assistant bookkeeper by Trail Leasing, embezzled funds from her employer. Haas had access to the check blanks for Trail Leasing's commercial account at Drovers. On April 11, 1983, she wrote out a check for $328.20 payable to Drovers First American State Bank. She then had two of Trail Leasing's authorized *191 officers sign the check. (Three of Trail Leasing's officers were authorized by resolution to sign checks and this authorization was on file with the bank. Haas was not one of the three.) Haas went to Drovers and asked for cash for the check. She filled out and gave to the bank a "change order form," a form used by a bank's customers specifying the coins and bill denominations in which they wish to take cash for business operations. Haas did not endorse the check. Drovers paid the cash to Haas, who pocketed the money.
From April 11, 1983, to October 1985, every few weeks, Haas would repeat this transaction, the amounts of the checks varying from $67.97 to as much as $1,156.43, always, it seems, in some odd amount and always payable to the Drovers bank. By the time her scheme was discovered (through a discrepancy in one of the change orders), Haas had negotiated 55 checks for a total of $39,952.17. The stipulation of facts does not disclose how Haas was able to get the authorized officers of her company to sign the checks, nor how her scheme was able to evade whatever internal controls her employer might have had. The checks contained no notations as to their purpose.
During all of this time Trail Leasing was indebted to Drovers on loans involving its leasing business. The stipulation of facts does not disclose the amounts or due dates of the periodic payments on these loans. Drovers did not participate in or know of the embezzlement scheme, and the parties stipulated that Drovers did not have notice of facts from which it could be inferred that Haas was acting contrary to her employer's interests. Drovers never contacted Trail Leasing to determine if Haas had authority to receive cash for these checks she brought to the bank. As already mentioned, Haas was not authorized by her employer to sign checks.
When this case was called for trial, a discussion arose on Drovers' asserted defense that it was a holder in due course. The parties felt this was a threshold issue. Consequently, the trial was continued and Drovers moved for summary judgment on its asserted defense. The trial court granted Drovers summary judgment, ruling that the bank was a holder in due course as a matter of law and, therefore, took the Haas checks free from all claims.
The court of appeals in an unpublished opinion reversed the trial court, ruling that Drovers was not a holder in due course because "Drovers did not take the instrument for value." Rather, "Haas was simply withdrawing money from Trail Leasing's commercial account." The appeals panel remanded the case for trial on plaintiff's negligence claim. We granted Drovers' petition for further review.
Apparently at the trial court and court of appeals levels, Trail Leasing alternatively contended that whether Drovers was a holder in due course was irrelevant to its negligence claim. Before us, however, Trail Leasing agrees with Drovers that if the bank is a holder in due course plaintiff's negligence claim is barred. The dispositive issue before us, then, and the only issue presented, is whether Drovers is a holder in due course.
The issue may be further narrowed. Under Minn.Stat. § 336.3-302 (1988), a holder in due course is anyone who takes the instrument "(a) for value; and (b) in good faith; and (c) without notice that it is overdue or has been dishonored or of any defense against or claim to it on the part of any person." Here it has been stipulated that Drovers took the Haas checks in good faith and without notice of any claims.[1] The issue then becomes, as it did for the appeals panel, whether Drovers meets the third requirement of taking the checks "for *192 value." This, too, is the issue raised in the petition for further review by Drovers.
We conclude that Drovers took the Haas checks "for value" and, therefore, was a holder in due course.
"A holder takes the instrument for value," says Minn.Stat. § 336.3-303(a), "to the extent that the agreed consideration has been performed or that he acquires a security interest in or lien on the instrument otherwise than by legal process." This provision eliminated a conflict in prior law by making clear that merely a promise to the transferor is not value until the promise has been performed[2] Here Drovers performed; it paid cash for the checks. Trail Leasing argues that at best Drovers gave only "conditional value" because it retained and exercised the right to debit Trail Leasing's commercial account. But even so, the bank first had to pay out its money before debiting Trail Leasing's account. As the comment to § 336.3-303 says, "Where an agreed sum of money is actually paid for an instrument * * * as the purchase price for it * * * the instrument is clearly taken `for value' * * *." Cf. Suit & Wells Equipment Co., Inc. v. Citizens Nat'l Bank of Southern Maryland, 263 Md. 133, 137, 282 A.2d 109, 111 (1971) (bank which cashes a check, i.e., purchases the check, drawn on another bank is a holder in due course); Roland v. Republic Nat'l Bank of Dallas, 463 S.W.2d 747, 749 (Tex.Civ.App.1971) (bank becomes a holder in due course when bank paid face value for checks presented by payee and drawn on an account at bank and thus had right to reimburse itself from customer's account). Cases cited by Trail Leasing where a bank takes a check, credits the depositor's account, but never issues cash against the check, are not on point. This is not a case, either, where Haas withdrew money from Trail Leasing's account with a simple withdrawal slip. Here she used a valid negotiable instrument.
Reversed and the trial court's summary judgment in favor of the bank is reinstated.
COYNE, J., took no part in the consideration or decision of this case.
NOTES
[1] In any event, it appears from the stipulation of facts that Drovers did not have actual notice of any claim by Trail Leasing that cash paid for the checks was not to be paid to Haas nor did it have knowledge of facts from which a holder could reasonably infer the probable existence of Trail Leasing's claim. See Eldon's Super Fresh Stores, Inc. v. Merrill Lynch, 296 Minn. 130, 136-37, 207 N.W.2d 282, 287-88 (1973). Under a holder in due course analysis, negligence does not amount to notice when based on "failure to make inquiry about an unknown fact." Id., 296 Minn. at 138, 207 N.W.2d at 288.
[2] See comment to Minn.Stat. § 336.3-303 (1988):
Where an agreed sum of money is actually paid for an instrument either as the purchase price for it or as a loan or discount on it as security * * * the instrument is clearly taken "for value" under paragraph (a). However, where the taker merely makes a promise to the transferor to pay, lend, act or transfer for example, where a bank gives revocable credit in a checking account there is no "value" until and to the extent that the credit is drawn out or the promise is otherwise performed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919959/ | 447 N.W.2d 896 (1989)
Eugene H. SEIBERLICH, Appellant,
v.
BURLINGTON NORTHERN RAILROAD COMPANY, Respondent.
No. C2-89-478.
Court of Appeals of Minnesota.
November 21, 1989.
Review Denied January 12, 1990.
*897 Lindsay G. Arthur, Jr., Katherine L. MacKinnon, Sarah Z. Erickson, Arthur, Chapman & McDonough, P.A., Minneapolis, for appellant.
Thomas W. Spence, Ward D. Werner, Thomas W. Spence Law Office, St. Paul, for respondent.
Heard, considered and decided by NORTON, P.J., and LANSING and FLEMING,[*] JJ.
OPINION
LANSING, Judge.
Eugene Seiberlich appeals a judgment entered on an adverse jury verdict after the trial court vacated an arbitration award of $234,849.46. We hold the district court did not err in vacating the judgment entered on the arbitrator's award, and affirm the judgment entered on the jury's findings.
FACTS
Eugene Seiberlich, an employee of Burlington Northern, injured his back in a work-related accident on January 13, 1982. Seiberlich was unable to return to work, and sought disability benefits under the Federal Employer's Liability Act (FELA).
In September, 1984, Seiberlich signed a release of all claims against Burlington Northern in exchange for a settlement of $90,000. On April 12, 1985, Seiberlich filed a complaint alleging that Burlington Northern's claims adjusters had violated the Minnesota Unfair Claim Practices Act, Minn.Stat. § 72A.20, in obtaining the release.
The Fourth Judicial District ordered arbitration under its Special Rules of Practice, and a nonbinding arbitration hearing was held on January 7, 1988. The arbitrator awarded Seiberlich $233,061.60 in addition to the $90,000 already paid by Burlington Northern.
A copy of the arbitrator's award was sent to each party's attorney, with a form letter notifying the parties that under Rule 5.12 of the Special Rules of Practice for the Fourth Judicial District any request for trial de novo must be made within 20 days of the arbitrator's award. Neither party requested a trial de novo, and on February 24, 1988, judgment was entered on the arbitrator's award.
On March 1, 1988, Burlington Northern filed a motion for relief from the judgment under Minn.R.Civ.P. 60.02. The trial court vacated the order for judgment and set the matter for trial. The jury found in favor of Burlington Northern, and judgment was entered on February 10, 1989.
On March 14, 1989, Seiberlich filed his notice of appeal to the court of appeals. Two weeks later, Burlington Northern filed a motion for taxation of costs incurred at trial. Seiberlich objected to the taxation of costs on the grounds that his appeal to this court stayed all further proceedings. The trial court awarded Burlington Northern $2,037.36 in costs, and judgment was entered.
Seiberlich appeals, limiting the appeal to the propriety of the trial court's vacation of the original judgment entered on the arbitrator's award, and to the trial court's award of trial costs to Burlington Northern after the notice of appeal had been filed.
ISSUES
1. Can Minn.R.Civ.P. 60.02 be used to vacate a judgment entered pursuant to Rule 5 of the Special Rules of Practice for the Fourth Judicial District?
2. Assuming that Rule 60.02 may be applied, did the trial court err in vacating the judgment entered pursuant to the arbitrator's award?
3. Did the trial court err in awarding trial costs to Burlington Northern after Seiberlich had filed his notice of appeal with the court of appeals?
*898 ANALYSIS
I
Seiberlich contends that Rule 5.11 of the Special Rules of Practice for the Fourth Judicial District is the exclusive means available to set aside an arbitration award and Minn.R.Civ.P. 60.02 cannot be applied to vacate the arbitrator's award in this case. This issue was previously addressed by this court in Pearce v. Lindstrom, 443 N.W.2d 857 (Minn.Ct.App.1989). In Pearce, we held that Rule 5.11 conflicts with Minn.R.Civ.P. 60.02 and therefore violates Minn.Stat. § 480.055 (1988), which allows courts to adopt rules governing practice which are not in conflict with rules promulgated by the Minnesota Supreme Court.
Seiberlich maintains that Pearce is inconsistent with two other decisions of this court, Gruman v. Hendrickson, 416 N.W.2d 497 (Minn.Ct.App.1987) and Great American Insurance Companies v. Lemieux, 439 N.W.2d 733 (Minn.Ct.App.1989), pet. for rev. denied (Minn. July 12, 1989).
In Gruman, this court stated in dicta that appellant's reliance on Rule 60.02 as a means to vacate an arbitration award was misplaced because Rule 5.11(d) specifically provides that judgment entered upon an arbitration award may not be attacked except as provided within the rule. Id. at 501. The Gruman dicta is a misstatement to the extent it fails to consider Minn.Stat. § 480.055.
The decision in Lemieux is distinguishable. Lemieux involved an arbitration proceeding under the arbitration clause in an automobile insurance policy. This court's reversal of the order vacating judgment in Lemieux was based on the failure of the party seeking to have the judgment vacated to comply with the provision of the Uniform Arbitration Act, Minn.Stat. § 572.19, subd. 2 (1988), which requires that a motion to vacate be brought within 90 days after notice of the award is received. Lemieux does not involve the application of a local court rule and is not governed by the proscriptions of Minn.Stat. § 480.055. The decision in Lemieux was governed by the framework of the Uniform Arbitration Act specifically set out in Minn. Stat. § 572.19.
The decision in Pearce controls in the present case and that decision does not conflict with other holdings of this court.
II
Whether a judgment should be opened is a matter largely within the discretion of the trial court, and that court's decision will not be reversed unless its discretion is abused. Kosloski v. Jones, 295 Minn. 177, 180, 203 N.W.2d 401, 403 (1973). When a party seeks relief from judgment under the "excusable neglect" provision of Rule 60.02, the trial court will grant relief if the party has met the four-part test set forth in Hinz v. Northland Milk & Ice Cream Co., 237 Minn. 28, 30, 53 N.W.2d 454, 455-56 (1952). Under Hinz, the party seeking relief must show: (1) that it has a reasonable defense on the merits; (2) that it has a reasonable excuse for its failure or neglect to answer; (3) that it has acted with due diligence after notice of entry of judgment; and (4) that no substantial prejudice will result to the other party.
The trial court's finding that Burlington Northern has met its burden of proof under Hinz is supported by the facts. The subsequent trial court decision in favor of Burlington Northern demonstrates that it had a reasonable defense on the merits. The record confirms that Burlington Northern acted with due diligence on notification of entry of the judgment, contacting the trial court to schedule a hearing on its motion to vacate within 24 hours of notification.
Seiberlich does not contend, and the record does not demonstrate, that any substantial prejudice resulted from vacation of the judgment. The matter ultimately went to trial, as both parties expected it would, and Seiberlich was able to present the same evidence and call the same witnesses as he would have had the original judgment not been entered.
As to excusable neglect, the attorney for Burlington Northern stated that he received a copy of the arbitrator's award *899 (with notification of the 20-day period within which to request trial de novo), but assumed that because the arbitration was designated as "nonbinding," the award would not in fact be controlling on the parties.
Parties to litigation should not be penalized for the neglect or mistakes of their lawyers. See, e.g., C & A Enterprises v. Carlson Tractor & Equipment Co., 408 N.W.2d 921, 923 (Minn.Ct.App.1987). When the defaulting party is not personally guilty of neglect and the party entrusts the matter to an attorney, courts should employ a liberal policy conducive to trial of causes on the merits. Lund v. Pan American Machines Sales, 405 N.W.2d 550, 554 (Minn.Ct.App.1987). The trial court did not abuse its discretion in vacating the judgment under Minn.R.Civ.P. 60.02 for excusable neglect on the part of Burlington Northern's attorney.
III.
Seiberlich contends that the trial court erred in awarding trial costs to Burlington Northern after Seiberlich had filed his notice of appeal with this court.
Minn.R.Civ.App.P. 108.03 provides:
When a bond is filed as provided by Rule 108.01, it shall stay all further proceedings in the trial court upon the judgment or order appealed from or the matter embraced in it; but the trial court may proceed upon any other matter included in the action and not affected by the judgment or order from which the appeal is taken.
The question is whether the taxation of trial costs is a matter "not affected by the judgment or order from which the appeal is taken."
In Spaeth v. City of Plymouth, 344 N.W.2d 815 (Minn.1984), the supreme court held that the trial court retained jurisdiction to enter an order awarding attorneys' and experts' fees, even though the case had been appealed. Id. at 825-26. This holding has been followed in Welsh v. City of Orono, 355 N.W.2d 117 (Minn.1984), and in Fette v. Peterson, 406 N.W.2d 594 (Minn. Ct.App.1987), pet. for rev. denied (Minn. June 30, 1987). The trial court's award of costs to Burlington Northern is "collateral and supplemental to decision on the merits," and the trial court did not err in making the award subsequent to the perfection of Seiberlich's appeal.
DECISION
A judgment on an arbitration award under Rule 5 of the Fourth Judicial District Special Rules of Practice may be vacated under Minn.R.Civ.P. 60.02, which provides for relief from any final judgment except a divorce decree. The trial court did not abuse its discretion in applying Rule 60.02 to the facts of this case. The trial court did not err in awarding trial costs to Burlington Northern after Seiberlich perfected his appeal to the court.
Affirmed.
NOTES
[*] Acting as judge of the Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 2. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614085/ | 111 Wis. 2d 470 (1983)
331 N.W.2d 83
STATE of Wisconsin, Plaintiff-Respondent,
v.
Michael Noel STONE, Defendant-Appellant.
STATE EX REL. Hickman M. CORLEY, Jr., Petitioner-Appellant,
v.
Edwin WILLIAMS, Adams County Sheriff, Respondent.
Nos. 82-080, 82-896.
Supreme Court of Wisconsin.
Argued January 6, 1983.
Decided March 29, 1983.
*471 For the appellant there was a brief and oral argument by L. William Connolly, Milwaukee. [Case No. 82-080.]
For the respondent the cause was argued by Michael R. Klos, assistant attorney general, with whom on the brief was Bronson C. La Follette, attorney general. [Case No. 82-080.]
For the appellant there were briefs and oral argument by James M. Mason, Wisconsin Rapids. [Case No. 82-896.]
For the respondent the cause was argued by Pamela Magee-Heilprin, assistant attorney general, with whom on the brief was Bronson C. La Follette, attorney general. [Case No. 82-896.]
On certification from court of appeals.
HEFFERNAN, J.
Both of these appeals arise out of extradition demands under the Uniform Criminal Extradition *472 Act, sec. 976.03, Stats. The State of Michigan sought the return of Stone to answer to charges of drug law violations, and the State of Ohio sought the return of Corley, who allegedly escaped from confinement there. Both were taken into custody in Wisconsin pursuant to warrants issued by the governor of Wisconsin following extradition demands made by the governors of Michigan and Ohio.
Both Stone and Corley sought to test the warrant issued in the demanding state in separate Wisconsin habeas corpus proceedings. Each of them based his demand for release on the ground that the warrant of the demanding state, and hence the warrant of the Wisconsin governor, was not based upon probable cause.
The State of Wisconsin resisted the demand for release on habeas corpus, contending in each case that, subsequent to Michigan v. Doran, 439 U.S. 282 (1978), where there was a judicial determination of probable cause in the demanding state, an asylum state was foreclosed from making any determination in respect to probable cause.
The Wisconsin law, clearly controlling prior to Doran, was that stated in State ex rel. Sieloff v. Golz, 80 Wis. 2d 225, 258 N.W.2d 700 (1977). This court therein held that an issue for a habeas corpus court in an asylum state in an extradition proceeding was whether properly authenticated documents from the demanding state demonstrated such probable cause as to justify the issuance of a governor's warrant in the asylum state.
In Sieloff, p. 242, we stated that:
"[T]here need be no deference accorded at this stage of the proceeding . . . to a finding of probable cause by the demanding state's magistrate."
This court, nevertheless, has always recognized the primacy of the federal law in interstate extradition. We said in Sieloff, p. 238:
*473 "[A state] may not enact or enforce standards in derogation of the federal rights of other states of the Union to obtain the return of persons who have violated their laws and fled from those jurisdictions."
Because we recognize the primacy of federal law, we follow the mandates of the United States Supreme Court in respect to the standards to be applied in extradition proceedings. While Sieloff, relying upon the Fourth Amendment, dictated that there be an opportunity for de novo review of the probable cause foundation for the issuance of the warrant of the asylum state's governor, Doran, relying upon the extradition clause, Art. IV, sec. 2, cl. 2,[1] of the United States Constitution, concluded that almost absolute deference was required to a finding of probable cause in the demanding state.
The United States Supreme Court held in Doran, p. 290:
"[O]nce the governor of the asylum state has acted on a requisition for extradition based on the demanding state's judicial determination that probable cause existed, no further judicial inquiry may be had on that issue in the asylum state."
[1]
Doran also made it explicit that not only was review of the existence of probable cause in the demanding state precluded if an appropriate determination had been made there, but it also strictly limited the review of any action pursuant to the demand that had been undertaken by the governor of the asylum state. Doran stated, p. 289:
"Once the [asylum state] governor has granted extradition, a court considering release on habeas corpus can *474 do no more than decide (a) whether the extradition documents on their face are in order; (b) whether the petitioner has been charged with a crime in the demanding state; (c) whether the petitioner is the person named in the request for extradition; and (d) whether the petitioner is a fugitive. These are historic facts readily verifiable."
Thus, even though it were to be argued that Doran did not expressly address the propriety of a court's review of the asylum state's governor's determination of probable cause for the issuance of his warrant, it seems clear that such a review is not encompassed in the review permitted by Doran.
The general attitude of the United States Supreme Court in respect to extradition proceedings is capsulized in the following quotation from Doran, p. 290:
"[W]hen a neutral judicial officer of the demanding state has determined that probable cause exists, the courts of the asylum state are without power to review that determination. . . . To allow plenary review in the asylum state of issues that can be fully litigated in the charging state would defeat the plain purposes of the summary and mandatory procedures authorized by Art. IV, sec. 2." (Emphasis supplied.)
Accordingly, it is apparent that Sieloff no longer correctly states the duty of a habeas corpus court in an asylum state when there has been a determination of probable cause by a judicial officer in the demanding state and the demanding state's documents are, on their face, in proper order. The United States Supreme Court's view of the law as stated in Doran is controlling. We are not, however, obliged to overrule Sieloff, for, in circumstances where the demanding state has not made a judicial determination of probable cause or where the documents do not demonstrate prima facie validity, the Sieloff analysis appears to be appropriate and not in conflict with controlling federal extradition law.
*475 Having concluded that the law as stated in Michigan v. Doran is controlling, we turn to the application of that case to the facts of the two cases before us.
Stone was arrested under a warrant for commitment issued August 18, 1981, pursuant to sec. 976.03 (15), Stats. A warrant was issued by the governor of Wisconsin for Stone's arrest and extradition on October 5, 1981. The extradition warrant was based on the requisition of the governor of Michigan, dated September 9, 1981, stating that Stone was charged with two counts of delivery of a controlled substance in Michigan. The Michigan demand for extradition was accompanied by copies of the complaint, of the arrest warrant, and of an affidavit of probable cause.
Stone petitioned for a writ of habeas corpus to challenge the governor's warrant pursuant to sec. 976.03 (10), Stats. Judge Neal Nettesheim, Circuit Judge, Waukesha county, upheld the extradition warrant on the grounds that the affidavit of probable cause stated probable cause to believe Stone committed the charged offenses.
Judge Nettesheim acknowledged Michigan v. Doran but felt obliged to follow the methodology laid down by this court in Sieloff. Basing his conclusion upon the Sieloff analysis, he found facts sufficient to justify probable cause and quashed the writ.
It is clear that, under the Doran analysis, which we are obliged to adopt, Judge Nettesheim's analysis was superfluous. At the most, assuming the prima facie sufficiency of the documents a fact not challenged he could only inquire whether a finding of probable cause had been made by a judicial officer in the demanding state.
Because the Michigan documents supporting the demand for extradition are before us, we make that limited inquiry. The warrant issued pursuant to the complaint recites, over the signature of the Michigan judge:
*476 "Whereas on examination of said sworn COMPLAINT and other sworn testimony by me, it appears to me that said offense has been committed and there is just cause to suspect that said Defendant(s) are guilty . . . ."
Moreover, sec. 764.1a, Michigan Stats., recites that a warrant shall be issued upon a finding of "reasonable cause."
[2]
It is clear, and it is not asserted to the contrary by Stone, that this finding is the equivalent of a finding of probable cause. Under Doran, we can go no further. Because we conclude that the documents presented are concededly in proper order and because a judicial officer of the demanding state has made a finding of probable cause, our inquiry is at an end. The order of the circuit court for Waukesha county, which quashed Stone's petition for habeas corpus, is affirmed.
Turning next to Corley's application for habeas corpus, the following facts appear of record.
Corley was arrested pursuant to an extradition warrant issued by the governor of Wisconsin on April 16, 1982. This warrant was based on the request for interstate rendition from the governor of Ohio, dated March 19, 1982, stating that Corley was charged with the crime of escape in Ohio. The request for rendition was accompanied by copies of an affidavit for complaint, the complaint, and the warrant for arrest, among other papers. The warrant for arrest is signed by a municipal court judge and dated March 15, 1982. The warrant does not contain a statement that probable cause was found but does have a parenthetical reference, under the heading, to Rule 4 (A) (1), Ohio Rules of Criminal Procedure.
Corley petitioned for a writ of habeas corpus. After a hearing, Circuit Judge Raymond E. Gieringer, Adams county, concluded that the papers from the demanding state were in order and that they established probable *477 cause. He quashed the writ of habeas corpus. Corley appealed.
It is apparent that Corley's case presents a somewhat different facet of extradition law than that discussed above in respect to Stone. In respect to Stone, there was an express recital in the documents from the demanding state that Stone's warrant was based upon a judicial determination of "just [probable] cause"; and, accordingly, a court in this state is precluded from making an independent or de novo probable cause determination. In respect to Corley, however, the magic words, "probable cause," "just cause," or "reasonable cause," do not appear in the extradition documents. What does appear on the face of the Ohio warrant is the caption:
"Warrant for Arrest (Rule 4 (A) (1), Ohio Rules of Criminal Procedure)"
Rule 4 (A) (1), which thus has been incorporated by reference into the complaint charging Corley, provides:
"If it appears from the complaint, or from an affidavit or affidavits filed with the complaint, that there is probable cause to believe that an offense has been committed, and that the defendant has committed it, a warrant for the arrest of the defendant . . . shall be issued by a judge . . . to any law enforcement officer authorized by law to execute or serve it."[2]
The question in Corley, then, is whether the presumption of regularity which Doran mandates and which has been recognized in State ex rel. Reddin v. Meekma, 102 Wis. 2d 358, 365, 306 N.W.2d 664 (1981), leads to the conclusion that, when an independent judicial officer of a demanding state issues a warrant and the law of that state explicitly requires that warrants only be issued upon *478 probable cause, the issuance of the warrant constitutes a judicial declaration that there has been a finding of probable cause.
While it is clear that we could not apply such a presumption to an unsubstantiated warrant issued by a Wisconsin judge, the purposes of the extradition clause, at least as viewed by the most recent discussion by the United States Supreme Court in Doran, appear to be served by a sweeping application of interstate comity. Comity, as mandated by the United States Supreme Court in Doran, indicates that we should conclude, given the presumption of regularity, that warrants issued by a demanding state are issued only on the basis of probable cause. While such presumption is, as Corley contends, undoubtedly a rebuttable one, the presumption cannot, under Doran, be attacked in the courts of the asylum state. As we said in Reddin v. Meekma, supra, p. 365, the proper forum for such attack upon the underpinnings of the warrant is the court of the demanding state that issued the warrant.
[3]
Thus, we conclude that, in accordance with interstate comity and in accordance with the presumption of regularity of the court proceedings in other states, mandated in respect to extradition by Doran, we must presume that the warrant issued in Ohio for the arrest of Corley for escape a warrant that incorporated by reference the Ohio statute requiring that warrants be issued only upon probable cause was in fact issued on the basis of an explicit finding of probable cause. Accordingly, we conclude that, because the finding of probable cause was made in Ohio by a judicial officer, this court is precluded from further inquiry. We need not, and under the current status of the federal law we may not, look to the facts to determine whether in our view there was probable cause for an arrest.
*479 We, therefore, conclude that the order of the circuit court for Adams county quashing Corley's application for habeas corpus must be affirmed.
We affirm the order of the circuit court for Waukesha county quashing the writ in respect to Stone, and we affirm the order of the circuit court for Adams county quashing the writ in respect to Corley.
By the Court. Orders affirmed.
NOTES
[1] "A person charged in any state with treason, felony, or other crime, who shall flee from justice, and be found in another state, shall, on demand of the executive authority of the state from which he fled, be delivered up, to be removed to the state having jurisdiction of the crime."
[2] We take judicial notice of the statutes of other states of the United States by virtue of sec. 902.02 (1), Stats. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614301/ | 939 So. 2d 224 (2006)
ARTURO GONZALEZ, Appellant,
v.
STATE OF FLORIDA, Appellee.
Case No. 2D05-2804.
District Court of Appeal of Florida, Second District.
Opinion filed October 13, 2006.
Heather M. Gray of Bodiford & Associates, P.A., Tampa, for Appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, and Amanda Lea Colón, Assistant Attorney General, Tampa, for Appellee.
PER CURIAM.
Arturo Gonzalez appeals the judgment, sentence, and fines that were imposed on him after a jury found him guilty of lewd or lascivious molestation against a victim less than twelve years of age. Mr. Gonzalez argues that the trial court erred when it (1) refused to give a definition in the jury instructions for the words "genital" and "genital area"; (2) allowed the State to amend the information at the end of the State's case-in-chief to reflect an offense date of October 8 until October 9, 2003; (3) allowed the State to elicit testimony and argue during closing arguments that Mr. Gonzalez had subsequent contact with law enforcement on an unrelated case; (4) denied his motion for a judgment of acquittal; and (5) added forty points to his sentencing worksheet for sexual contact with the victim. We find no reversible error in the trial court's rulings on these matters, and we affirm Mr. Gonzalez' judgment and sentence without further comment.
In a separate issue, Mr. Gonzalez argues that two separate fines of $50 and $65 for court costs should be stricken because they were discretionary costs and the trial court failed to orally pronounce them at sentencing. On this issue, we agree. The trial court assessed these fines as mandatory costs in accordance with section 775.083(2), Florida Statutes (2004), and section 939.185, Florida Statutes (2004), respectively. These statutes, however, did not take effect until July 1, 2004. Because Mr. Gonzalez' offense date was October 8, 2003, the trial court should have assessed these costs in accordance with the statutes in effect at that time (i.e., section 775.083(2)(b), Florida Statutes (2003),[1] and section 939.18, Florida Statutes (2003)[2]), which required the court to conduct an inquiry into the defendant's ability to pay the fine before imposing it.
Because the trial court imposed both discretionary court costs without conducting the required inquiry concerning Mr. Gonzalez' ability to pay, we strike these costs. On remand, the trial court may reimpose the appropriate costs if it conducts the necessary hearing. See Stewart v. State, 916 So. 2d 53, 54 (Fla. 2d DCA 2005); Waller v. State, 911 So. 2d 226, 229 (Fla. 2d DCA 2005).
Affirmed in part, reversed in part, and remanded.
WHATLEY, SILBERMAN, and WALLACE, JJ., Concur.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED.
NOTES
[1] The 2004 version of section 775.083 replaced the 2003 version effective July 1, 2004. Ch. 2003-402, § 117, at 3741-42, Laws of Fla.
[2] The Florida legislature repealed section 939.18 effective July 1, 2004. Ch. 2004-265, § 101, at 1026, Laws of Fla. It replaced this section, effective the same day, with section 939.185. Ch. 2004-265, § 88, at 1022-23, Laws of Fla. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614111/ | 23 So. 3d 715 (2009)
MARSHALL
v.
STATE.
No. 1D08-5366.
District Court of Appeal of Florida, First District.
December 8, 2009.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614149/ | 23 So.3d 1156 (2009)
D.P.
v.
MADISON COUNTY DEPARTMENT OF HUMAN RESOURCES.
2080243.
Court of Civil Appeals of Alabama.
May 8, 2009.
Brian D. Clark of Clark, Smith & Messervy, P.C., Huntsville, for appellant.
Sharon E. Ficquette, gen. counsel, and Elizabeth L. Hendrix, staff atty., Dept. of Human Resources, for appellee.
BRYAN, Judge.
D.P. ("the father") appeals from judgments of the Madison Juvenile Court ("the juvenile court") terminating his parental rights to P.P., a girl born in March 2003, and L.P., a boy born in May 2004 (collectively referred to hereinafter as "the children").[1]
The record reveals the following pertinent facts. The Madison County Department of Human Resources ("DHR") first became involved with the children in May 2007, when DHR received a report asserting that the children had inadequate supervision and inadequate food and that the father and L.L. were ("the mother") using drugs in the presence of the children. After an investigation, DHR took custody of the children; on July 11 2007, based on a stipulation of the parties, the juvenile court found the children to be dependent and authorized their placement in foster care.[2] On April 22, 2008, DHR petitioned *1157 the juvenile court to terminate the parental rights of the father and the mother to the children. In the petitions, DHR stated that the juvenile court had previously adjudicated the children to be dependent, that the condition of the parents was such that they were unable or unwilling to properly care for the children, that that condition was unlikely to change in the foreseeable future, and that DHR had been unable to locate a suitable relative to assume custody of the children.
On October 6, 2008, the juvenile court held an ore tenus proceeding regarding DHR's petitions to terminate the father's parental rights. The father was not present because he was incarcerated at the time of that proceeding. Lloyd Holloway, the DHR case worker assigned to the children, was the only witness to testify at the parental-rights-termination hearing.
Testimony relevant to this appeal revealed the following. Holloway stated that DHR had been unable to offer any services to the father because, he said, in June 2007, shortly after DHR had assumed temporary custody of the children, the father became incarcerated; Holloway testified that the father remained incarcerated at the time of the hearing. The permanency plan for the children was adoption by the current foster parent. Holloway stated that he has not been in contact with the father since his incarceration, but he was aware that the father had been writing the children letters.
Following Holloway's testimony regarding DHR's investigation of viable alternatives to termination of the father's parental rights, DHR rested its case. The guardian ad litem for the children did not object to DHR's petitions to terminate the father's parental rights.
At the close of the evidence, the juvenile court orally granted DHR's petitions to terminate the father's parental rights. On October 20, 2008, the father moved the juvenile court to reopen the proceeding, citing his current incarceration and his belief that he would be "released in the near future" and alleging that he had made "significant progress in rehabilitating himself." DHR opposed the father's motion to reopen the proceeding, asserting that the father, through his own choices, had been incarcerated at the time of the hearing and had presented no evidence indicating that he would be immediately released from incarceration. The juvenile court denied the father's motion.
On November 20, 2008, the juvenile court issued written judgments terminating the parental rights of the father to the children.[3] Those judgments, in pertinent part, state:
"The [children], who previously had been adjudicated by the Court to be dependent, remain[] dependent....
"No parent or other relative has sought to exercise furnish [sic] material support for the child[ren]. During the time the child[ren] ha[ve] been in the care of [DHR] or a person designated by [DHR], the father has been incarcerated.
"....
"[DHR] has considered less drastic alternatives to filing a petition to terminate parental rights. Neither [DHR] nor this Court believes that there are any alternatives less drastic than termination of parental rights available to serve the best interests of the child[ren]. Placement alternatives which were considered *1158 and determined not to be in the child[ren]'s best interests include placement with suitable relatives. Despite a diligent search, [DHR] has been unable to locate a suitable relative to assume custody of the child[ren].
"The [father] of the child[ren] [is] unable or unwilling to discharge [his] responsibilities to the child[ren]. The conduct and condition of the [father] is such that [sic] as to render [him] unable or unlikely to change in the foreseeable future.
"The best interests of the child[ren] require that the parental rights of the [father] be terminated and the child[ren] be placed in the permanent legal custody of [DHR] for the purposes of adoptive planning."
On December 1, 2008, the father filed a "Motion to Reconsider," alleging that the children are being well provided for by the foster parent and that it would be in the best interest of the children to remain in foster care until the father was released from incarceration "in the near future." The juvenile court denied the father's motion, and the father timely appealed.
On appeal, the father alleges that DHR failed to prove by clear and convincing evidence that he was unable or unwilling to care for the children. Our resolution as to that issue is dispositive of this appeal, thus we do not address the father's remaining issue regarding whether DHR exhausted all viable alternatives before terminating his parental rights.[4]
"This court's standard of appellate review of judgments terminating parental rights is well settled. A juvenile court's factual findings, based on ore tenus evidence, in a judgment terminating parental rights are presumed to be correct and will not be disturbed unless they are plainly and palpably wrong." J.C. v. State Dep't of Human Res., 986 So.2d 1172, 1183 (Ala. Civ.App.2007).
Section 26-18-7, Ala.Code 1975, states, in pertinent part:
"(a) If the court finds from clear and convincing evidence, competent, material, and relevant in nature, that the parents of a child are unable or unwilling to discharge their responsibilities to and for the child, or that the conduct or condition of the parents is such as to render them unable to properly care for the child and that such conduct or condition is unlikely to change in the foreseeable future, it may terminate the parental rights of the parents. In determining whether or not the parents are unable or unwilling to discharge their responsibilities to and for the child, the court shall consider, and in cases of voluntary relinquishment of parental rights may consider, but not be limited to, the following:
"(1) That the parents have abandoned the child, provided that in such cases, proof shall not be required of reasonable efforts to prevent removal or reunite the child with the parents.
"(2) Emotional illness, mental illness or mental deficiency of the parent, or excessive use of alcohol or controlled substances, of such duration or nature as to render the parent unable to care for needs of the child.
"(3) That the parent has tortured, abused, cruelly beaten, or otherwise maltreated the child ....
"(4) Conviction of and imprisonment for a felony.
*1159 "(5) Unexplained serious physical injury to the child under such circumstances as would indicate that such injuries resulted from the intentional conduct or willful neglect of the parent.
"(6) That reasonable efforts by the Department of Human Resources or licensed public or private child care agencies leading toward the rehabilitation of the parents have failed.
"(7) That the parent has been convicted by a court of competent jurisdiction of any of the following:
"a. Murder or voluntary manslaughter of another child of that parent.
"b. Aiding, abetting, attempting, conspiring, or soliciting to commit murder or voluntary manslaughter of another child of that parent.
"c. A felony assault or abuse which results in serious bodily injury to the surviving child or another child of that parent....
"(8) That parental rights to a sibling of the child have been involuntarily terminated."
(Emphasis added.)
This court has stated that clear and convincing evidence is "`[e]vidence that, when weighed against evidence in opposition, will produce in the mind of the trier of fact a firm conviction as to each essential element of the claim and a high probability as to the correctness of the conclusion.'" L.M. v. D.D.F., 840 So.2d 171, 179 (Ala.Civ.App.2002)(citing § 6-11-20(b)(4), Ala.Code 1975).
The father argues that DHR did not present clear and convincing evidence demonstrating that he was unable or unwilling to care for his children because, he states, DHR relied on his incarceration to support that assertion, but failed to enter evidence on the record showing that he is incarcerated as a result of a felony conviction. In response, DHR states that Holloway's testimony revealed that the father had been incarcerated from June 2007 through the date of the termination hearing, approximately 16 months. DHR argues that that testimony is sufficient evidence to demonstrate that the father has been convicted of a felony because a felony conviction requires that a convicted felon serve at least one year and one day in a correctional facility. See § 13A-5-6(a), Ala.Code 1975.
After careful review, we find that there is nothing in the record to confirm that the father has been convicted of and imprisoned for a felony. We are not convinced that the father is incarcerated for a felony conviction simply based on the fact that he has been incarcerated for more than one year and one day.[5] There is no evidence indicating that the father has been convicted of and imprisoned for a felony, nor is there sufficient evidence to show that the father has engaged in any behavior found in § 26-18-7(a)(1)-(8) that would support a finding of his inability or unwillingness to discharge his responsibility as a parent to the children.[6] It is clear from the testimony of the only witness called by DHR that DHR was relying on the father's incarceration to serve as the ground for terminating *1160 his parental rights. We cannot assume that the father has been convicted of a felony based on nothing more than Holloway's testimony that the father has been incarcerated for approximately 16 months.
We conclude that DHR did not clearly and convincingly show that the father was convicted of and imprisoned for a felony to support a finding that he was unable or unwilling to care for the children. We, therefore, reverse the juvenile court's judgment terminating the father's parental rights.[7]
REVERSED.
THOMPSON, P.J., and PITTMAN, J., concur.
THOMAS and MOORE, JJ., concur in the result, without writings.
NOTES
[1] L.L., the mother, also had her parental rights terminated in the same judgments. She is not a party to this appeal.
[2] A report from DHR dated July 22, 2008, states that the children were placed with the father from May 25, 2007, through August 6, 2007, when they were placed with their current foster parent. That fact conflicts with the testimony of Lloyd Holloway, a DHR case worker assigned to the children, indicating that the father was incarcerated in June 2007.
[3] The juvenile court issued separate judgments regarding P.P. and L.P., but the judgments contained identical language.
[4] Although we are not ruling on the issue whether DHR sufficiently overcame its burden regarding viable alternatives, we note that the evidence presented by DHR regarding viable alternatives is sparse.
[5] This argument ignores the possibility that the father is incarcerated and serving time for more than one misdemeanor conviction.
[6] We recognize that other factors not mentioned in § 26-18-7(a)(1)-(8) may be considered in parental-rights-termination cases. See In re Colbert, 474 So.2d 1143, 1146 (Ala.Civ. App.1985). However, the record does not indicate that DHR relied on any factors other than the father's alleged conviction of and incarceration for a felony as a basis for terminating his parental rights.
[7] We note that, by reversing the judgment in this case, we are not holding that the children are no longer dependent or that the father is entitled to custody of the children in the event the father is no longer incarcerated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919972/ | 180 Mich. App. 495 (1989)
447 N.W.2d 797
HILL
v.
ADLER'S FOOD TOWN, INC
Docket No. 105360.
Michigan Court of Appeals.
Decided July 26, 1989.
Raymond L. Krell, P.C. (by Derek A. Hurt), for plaintiff.
Law Offices of Brochert & Ward (by Linda M. Garbarino), for defendant.
Before: WAHLS, P.J., and DOCTOROFF and BRENNAN, JJ.
PER CURIAM.
Defendant appeals by leave granted from a November 25, 1987, order of the Oakland Circuit Court denying its motion for summary disposition on the basis that the common-law rule enunciated in Kreski v Modern Wholesale Electric Supply Co, 429 Mich. 347; 415 NW2d 178 (1987), known as the fire fighter's or police officer's rule and which provides that "a fire fighter or police officer may not recover damages from a private party for negligence in the creation of the reason for the safety officer's presence," 429 Mich. 358, is inapplicable in this case. We reverse the order of the circuit court and hold that plaintiff's action is barred by the rule enunciated in Kreski.
The record reveals that plaintiff Rodney C. Hill is an Oakland County deputy sheriff and that plaintiff Janette Hill is his wife. On January 19, 1985, Hill responded to a call for police assistance from defendant, Adler's Food Town, Inc., a local food store at which employees had apprehended two shoplifting suspects. When Hill and his partner arrived at the store, an employee led them to the shoplifting suspects, who were being detained in the manager's office in an area accessible by a *497 flight of four steps and not open to the public. After spending about twenty minutes in the manager's office, Hill and his partner began to escort the two shoplifting suspects out of the store. While descending the flight of steps from the manager's office, Hill slipped, he alleges, on "water and other foreign substances" which had accumulated on the top step, causing him to fall and injure his head and left leg.
Hill filed a complaint and, subsequently, two amended complaints against the store, alleging negligence. The store filed a motion for summary disposition pursuant to MCR 2.116(C)(8) and (C)(10), contending that Hill's action was barred by the police officer's rule as set froth in Kreski, supra. The circuit court, after hearing the parties' positions as presented during oral argument, denied defendant's motion without prejudice, finding that plaintiffs' claim was not barred by the police officer's rule because it fell within the rule's "exceptions" recognized by the Supreme Court in Kreski.
In denying the store's motion for summary disposition, the circuit court failed to indicate the particular subrule under which it was proceeding. It is apparent, however, from the focus of the parties' counsel and of the court on the significance of the Kreski opinion as well as from the lack of focus on any disputed factual issues, that the order was issued pursuant to MCR 2.116(C)(8) failure to state a claim on which relief can be granted. Regarding this subrule, this Court has stated:
A motion for summary disposition under MCR 2.116(C)(8) will be granted only where the claim is unenforceable as a matter of law. Because such a motion tests the legal basis of the complaint, its *498 factual allegations are taken as true, along with any reasonable inferences or conclusions which may be drawn from them. Rathbun v Starr Commonwealth For Boys, 145 Mich. App. 303, 307; 377 NW2d 872 (1985), lv den 424 Mich. 908 (1986); Local 80 Sheet Metal Workers v Tishman Construction Corp, 103 Mich. App. 784, 787; 303 NW2d 893 (1981). [Kauffman v Shefman, 169 Mich. App. 829, 833; 426 NW2d 819 (1988).]
On appeal, the store maintains that the rule in Kreski "bars plaintiff's negligence action because he was injured from an inherent risk in the performance of his employment as an Oakland County sheriff's deputy." Hill, in response, contends that the rule in Kreski is inapplicable in this case because "[p]laintiff's fall had absolutely nothing to do with the nature and purpose of police work, which is to confront danger and protect the public," and that, even if the rule were applicable, certain exceptions to the rule, recognized by the Supreme Court in the Kreski decision itself, are applicable in this instance.
In Kreski, supra, p 372, the Supreme Court stated:
[A]s a matter of public policy, we hold that fire fighters or police officers may not recover for injuries occasioned by the negligence which caused their presence on the premises in their professional capacities. This includes injuries arising from the normal, inherent, and foreseeable risks of the chosen profession.
We find that a police officer's slipping and falling on a negligently maintained step in a store to which he was summoned to exercise his authority to detain, question and arrest apprehended shoplifting suspects constitute occurrences stemming from the performance of the officer's police duties. *499 It is impossible to imagine that Hill could have fulfilled his obligation to investigate the situation and, if necessary, to escort the shoplifting suspects from the store to the sheriff's office without, in this case, entering the manager's office where the shoplifting suspects were being detained and transporting the suspects from the store to the sheriff's office. In order to accomplish these functions, it was necessary that Hill ascend the four steps leading to the manager's office and later descend them with the shoplifting suspects in custody. Thus, the negligence, if any, of the store relating to the condition of the steps leading to the manager's office created a hazard which posed a threat to the safety of Hill in the performance of his duties. Such is precisely the type of action to which the rule in Kreski was intended to apply.
Our conclusion that the rule in Kreski is applicable in this case is buttressed by cases from other jurisdictions cited by the Kreski Court. For example, in Flowers v Rock Creek Terrace, 308 Md 432; 520 A2d 361 (1987), discussed in Kreski, supra, pp 373-374, the Maryland Court of Appeals held that a fire fighter was precluded from suing the defendants for injuries sustained from falling down an open elevator shaft while attempting to evacuate tenants from a smoke-filled lobby on the twelfth floor of an apartment building, and in Williams v Levitt, 213 NJ Super 604; 517 A2d 1242 (1986), discussed in Kreski, supra, p 374, the New Jersey Superior Court held that a police officer was precluded from suing a defendant homeowner for injuries sustained from tripping in a hole in the homeowner's yard while investigating the activation of a burglar alarm. Moreover, in Reetz v Tipit, Inc, a case consolidated with Kreski, the Supreme Court held that a police officer was precluded from suing a bar for injuries sustained from *500 falling approximately ten feet through an open trap door while investigating a reported breaking and entering at the bar. In reaching its decision, the Supreme Court emphasized that the plaintiff police officer was performing her duty when she fell and that, "[i]n performance of her duty, plaintiff took the premises as she found them, with no representations being made regarding their safety." 429 Mich. 378.
Moreover, we discern no merit in plaintiff's contention that "exceptions" to the rule in Kreski apply in this case. First, the Supreme Court in Kreski did not specifically adopt any exceptions to the rule but merely noted, with some discussion on the matter, that "[s]everal exceptions involving factual situations not presented here have developed in the states employing a fireman's rule." 429 Mich. 370. In separate opinions in Kreski, Justices ARCHER and CAVANAGH expressed their willingness to sign the majority opinion because it did not wholly foreclose fire fighters and police officers from bringing causes of action for injuries sustained under certain circumstances. 429 Mich. 379-380. Indeed, the majority opinion itself specifically acknowledged that "we are not attempting to delineate the precise parameters of the rule in this opinion." 429 Mich. 370. Nevertheless, even if we were to treat as exceptions to the rule the three criteria listed in Hill's appellate brief, we would not be tempted in this case to conclude that any of the three criteria had been fulfilled.
Based on language on page 371 of the Kreski opinion, Hill asserts that several exceptions to the general rule exist. He further asserts that three of those exceptions concern actions by a police officer or fire fighter regarding injuries sustained in a building (1) when the building was open to the *501 public for business, (2) when the building's owners or occupiers were on the premises at the time of the incident and were aware of the safety officer's presence, and (3) when the building's owners or occupiers had a present ability to warn the safety officer of the danger on the premises. The first exception is inapplicable because the area in which Hill sustained his injuries was not "open to the public." 429 Mich. 371. The second and third exceptions are inapplicable because the danger which facilitated Hill's slip and fall, said by Hill himself to have been "water and other foreign substances" on the top of the four-step stairway leading to the manager's office, was not a hidden condition. 429 Mich. 361, 371, 373.
Having determined that the rule in Kreski is applicable in this case and that the claimed exceptions to that rule recited in Hill's appellate brief are inapplicable, we reverse the order of the circuit court and hold that Hill's action against Adler's Food Town, Inc., does not state a claim for which relief can be granted.
Reversed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919975/ | 447 N.W.2d 569 (1989)
Donald L. BETTIS, Plaintiff-Appellant,
v.
WAYNE COUNTY MUTUAL INSURANCE ASSOCIATION, Defendant-Appellee.
No. 88-1423.
Court of Appeals of Iowa.
August 23, 1989.
Lance A. Grotewold, of Heslinga, Heslinga, Dixon & Grotewold, Oskaloosa, for plaintiff-appellant.
Lawrence P. McLellan, of Bradshaw, Fowler, Proctor & Fairgrave, Des Moines, for defendant-appellee.
Considered by DONIELSON, P.J., and SCHLEGEL and SACKETT, JJ.
SACKETT, Judge.
The question we must answer is whether the trial court correctly determined damages incurred while towing a tractor, following a collision, were not covered under collision insurance plaintiff-appellant Donald Bettis had with defendant-appellee Wayne County Mutual Insurance Association. *570 We find the damage was covered. We reverse the trial court.
This is a declaratory judgment action tried in equity. Our review is de novo. Iowa R.App.P. 4; see Grinnell Mut. Reins. Co. v. Voeltz, 431 N.W.2d 783, 785 (Iowa 1988). We give weight to the district court's findings of fact but are not bound by them. Iowa R.App.P. 14(f)(7).
The front suspension of plaintiff's farm tractor was damaged when it struck a culvert while being operated by the plaintiff's son. One of plaintiff's neighbors was contacted to tow the tractor into town for repairs. Before the tractor was towed, another one of plaintiff's sons placed the gearshift lever in the position marked "Tow." The tractor was then towed into town at twenty to twenty-five miles per hour, the tractor's normal operating speed. During towing, the front end of the tractor was raised approximately one foot off the ground.
When one of the plaintiff's sons picked up the tractor after the suspension repairs were made, he noticed the transmission did not seem to be operating properly. He immediately took the tractor to the local implement dealer, where it was discovered the upper and lower pinion shafts had frozen to the gears in the transmission. The mechanic who worked on the tractor believed the damage had been caused by towing the tractor without the engine running, thus preventing the transmission from being properly lubricated.
The owner's manual for the tractor provided the engine must be kept running during towing to maintain power steering and power brakes, and an extra gallon of oil should be added to the transmission for every six inches the front end is raised. No oil was added to plaintiff's tractor before it was towed. Plaintiff did not have an owner's manual, as he had bought the tractor used. Testimony at trial indicated the manual did not clearly state that the engine should be kept running in order to keep the transmission lubricated.
Plaintiff's insurer, defendant Wayne County Mutual Insurance Association, paid for the suspension repairs, less deductible, under plaintiff's collision coverage. Defendant refused to pay the transmission repair bill of over $6,000 due to policy language limiting coverage to "direct loss resulting from overturn or collision." Defendant argued the transmission damage was not a direct result of the collision.
Plaintiff filed the present declaratory judgment action, seeking a determination whether the policy covered the transmission damage. The district court held that the policy did not cover the transmission damage because the transmission damage was not a "direct loss resulting from" the collision with the culvert. The district court concluded that "direct loss" refers to proximate cause and that the culvert collision here was not a proximate cause of the transmission damage because it was not a substantial factor in causing the transmission damage. In making this determination, the court relied upon the definition of proximate cause found in the Negligence chapter of the Iowa Uniform Jury Instructions.
Plaintiff has appealed the district court's ruling. He contends the district court misinterpreted the phrase "direct loss" by applying the tort concept of proximate cause to a question of contract interpretation. Plaintiff argues the transmission damage was directly caused by the culvert collision because it would not have happened in the absence of the collision.
Our goal in interpreting an insurance policy is to determine the intent of the parties at the time the policy was sold. Due to the difference in bargaining power between the parties, we interpret any ambiguities in favor of the insured. We interpret the policy from the standpoint of an ordinary person, rather than an expert, in order to further the reasonable expectations of the parties. Grinnell Mut. Reins. Co. v. Voeltz, 431 N.W.2d 783, 785-86 (Iowa 1988).
Our supreme court has stated that the term "direct loss by fire" in a fire insurance policy is generally synonymous with proximate cause. Kintzel v. Wheatland Mut. Ins. Assoc., 203 N.W.2d 799, 808 *571 (Iowa 1973). In an insurance policy, direct cause means immediate cause or proximate cause, as distinguished from remote cause. See Tracy v. Palmetto Fire Ins. Co., 207 Iowa 1042, 1045, 222 N.W. 447, 448 (1929). "`Direct' as used in an insurance policy relates to causal connection and is to be interpreted as the immediate or proximate cause as distinguished from the remote cause." John Drennon & Sons Co. v. New Hampshire Ins. Co., 637 S.W.2d 339, 341 (Mo.Ct.App.1982).
The doctrine of proximate cause is applied differently in insurance cases than in tort cases. Beckley v. New York Life Ins. Co., 229 Iowa 1007, 1013, 295 N.W. 844, 847 (1941). In insurance law, an insured event is considered the proximate cause of a loss if the event sets in motion other causes which, through an unbroken sequence and connection, result in the loss. Qualls v. Farm Bureau Mut. Ins. Co., 184 N.W.2d 710, 713 (Iowa 1971).
When it is said that the cause to be sought is the direct and proximate cause, it is not meant that the cause or agency which is nearest in point of time or place to the result is necessarily to be chosen, since the dominant cause may be concurrent or remote in point of time or place.
43 Am.Jur.2d Insurance § 463 (1982). Thus, we look not necessarily to the last act in the chain of events, but rather to the predominant cause which set in motion the chain of events causing the loss. 5 J. Appleman, Insurance Law & Practice § 3083, at 309 (1970).
In Chase Investment Co. v. Mid-Western Casualty Co., 232 Iowa 73, 4 N.W.2d 863 (1942), the plaintiff's truck was damaged in a collision. Plaintiff's driver required hospitalization immediately after the accident. Left unprotected, the truck suffered freezing damage to its motor and was broken into. The court refused to find that the freezing and theft were intervening, independent causes of damage to the truck. It instead held that the collision itself was the proximate cause of the damage. Id. at 77, 4 N.W.2d at 865.
The loss in this case, the transmission damage, was the result of a chain of events set in motion by the collision, an insured event. While the defendant urges us to look at the towing as the efficient physical cause of the loss, we find the collision in the ditch was the dominant cause of the transmission damage. Therefore, the transmission damage is covered by plaintiff's collision insurance.
The parties to the insurance contract here could have reasonably foreseen that a collision would result in the need for towing, and damage to the vehicle might result while it was being towed. Such a contingency should therefore be deemed an element of the risk insured against. See Lipshultz v. General Ins. Co. of Am., 256 Minn. 7, 96 N.W.2d 880, 886 (1959).
The district court decision is reversed.
REVERSED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614391/ | 23 So. 3d 291 (2009)
STATE of Louisiana
v.
Ryan Marie SMITH.
No. 2007-K-2028.
Supreme Court of Louisiana.
October 20, 2009.
Rehearing Denied December 11, 2009.
*292 James D. Caldwell, Attorney General, Paul Carmouche, Dist. Atty., Lea R. Hall, Jr., Catherine Marion Estopinal, Asst. Dist. Attys., for Applicant.
Margrett Ford, New Orleans, for Respondent.
PER CURIAM.[1]
The state charged defendant and Raul Jorge Castro by bill of information with armed robbery in violation of La. R.S. 14:64. The cases severed when Castro entered a plea of guilty as charged on the day before trial. Following trial by jury, defendant was found guilty as charged and sentenced to 12 years imprisonment at hard labor without benefit of parole, probation, or suspension of sentence. Defendant appealed her conviction and sentence to the Second Circuit, which found that the evidence presented at trial appeared sufficient to support her conviction as a principal to the crime of simple robbery but not to the charged offense of armed robbery because the state had failed to establish that defendant knew or intended that Castro would arm himself with a gun immediately before confronting the victim in a Wal-Mart parking lot and snatching her purse from a shopping cart within her control. The court of appeal accordingly vacated defendant's conviction for armed robbery, entered a judgment of guilt for simple robbery in violation of La. R.S. 14:65, and remanded for resentencing. State v. Smith, 42,302 (La.App.2d Cir.8/15/07), 962 So. 2d 1190 (Brown, C.J., dissenting from denial of rehearing). We granted the state's application to review the decision below and reverse because we disagree with the premise of the Second Circuit's opinion that "[t]o be a principal to armed robbery, the State must prove beyond a reasonable doubt that a defendant knew that her co-offender would arm himself with a dangerous weapon." Smith, 42,302 at 4, 962 So.2d at 1193.
On a late August afternoon in 2005, Tammy Rogers rolled her shopping cart through a pelting rain storm to the rear of her SUV parked on the lot of a Wal-Mart on Mansfield Road in Shreveport. Rogers held an umbrella against the rain and she had placed her purse on top of the items stacked in the shopping cart. She popped the rear hatch of her vehicle to begin loading her purchases into the back when she noticed a small white car stop nearby. Rogers at first thought the occupants were looking for a shopping cart. Instead, an Hispanic man jumped out of the vehicle, ran around, grabbed Rogers's purse out of *293 her cart, then jumped back into the car, which sped away. Rogers could not tell whether the man had anything in his hand because he was holding his arm down at his side and the confrontation had happened "very fast." However, she observed that the vehicle had at least two other occupants.
The Hispanic male was Raul Jorge Castro and, as he admitted when he entered a guilty plea to armed robbery, he had been armed with a small, black powder hand gun. Castro was defendant's boyfriend and they had arrived in Shreveport only days earlier from Arkansas in a stolen white Kia sedan. They were staying with defendant's aunt in Shreveport and on the afternoon of August 9, 2005, they drove to the Wal-Mart in the company of Cody Duos, defendant's 17-year-old cousin, and his younger brother, Dillon. Both boys sat in the back seat of the vehicle as defendant drove and Castro occupied the front passenger seat. Cody Duos testified at trial that along the way, Castro talked about removing the license plate from the car, although they were ostensibly going to the Wal-Mart only to buy some groceries. When they arrived at the Wal-Mart, defendant began driving up and down the parking lot aisles for "like just a little while," bypassing open parking places as she and Castro discussed looking for people with umbrellas. Defendant then stopped briefly and Castro climbed into the back seat of the car. Cody did not notice that Castro had anything in his hand when he joined him in the back seat as defendant continued cruising the parking lot but he heard defendant and Castro discuss that Rogers would be an "easy snatch" when they spotted her. After defendant stopped, Cody noticed for the first time that Castro had a gun in his hand as he stepped out of the car and rushed towards the victim. According to Cody, defendant also got out of the car and went "[s]traight for the lady's purse." He testified that defendant then snatched the purse from the cart as Castro stood next to her with a gun and pointed it at the victim "like a little above her head just a bit." After defendant and Castro jumped back into their car with Rogers's purse, defendant "just started driving.... She got lost, and they ditched the purse," but not before Castro removed Rogers's check book and several credit cards. Defendant eventually drove to a Kentucky Fried Chicken where they used one of Rogers's checks to pay for food at the take-out window. Cody testified that as they headed back to the residence of defendant's aunt, defendant threatened to tie him up and beat him if he mentioned the purse snatching to anyone and Castro drove home the point by waving the gun in his face as he warned that he would kill him and his brother if he talked.
On August 11, 2005, officers from the Caddo Parish Sheriff's Office acted on tips that a redheaded woman and an Hispanic male were passing bad checks and could be found at the address of defendant's aunt, and located the white Kia parked outside the residence. The officers ran the plate number on the vehicle and determined that it had been reported stolen in Arkansas. They knocked on the door and spoke with defendant's aunt, who told them that the car belonged to defendant and Castro and that they were staying with her. After speaking with Cody and determining that defendant and Castro had passed a bad check at Kentucky Fried Chicken, the officers ran a check and found out that Tammy Rogers had made a report of a robbery two days earlier. They searched the white Kia and recovered the check book and credit cards taken from Rogers, along with two black powder pistols. Cody then led the officers to the location where Castro had discarded *294 Rogers's purse and the police recovered that item as well. At trial, Cody Duos identified one of the guns as the weapon he had seen in Castro's hand as he got out of the car and approached Tammy Rogers.
Following her arrest, defendant gave a statement to the police in which she initially denied any knowledge of the Rogers offense, but eventually admitted that she had been present and that, "We took a lady's purse." However, she denied any knowledge that Castro had used a gun. At trial, defendant testified that after they arrived at Wal-Mart, she gave the wheel to Cody and climbed into the back seat with Castro after Dillon got up front to sit next to his brother. "We stopped the vehicle," defendant told jurors, "Jorge got out with the gun in his hand, stole the purse out of the lady's buggy, jumped back in the car, and we took off." Defendant identified the silver black powder pistol recovered from the Kia as the weapon Castro had held in his hand as he approached Rogers. According to defendant, Cody was still at the wheel when they drove away and defendant claimed that Cody and Dillon then got "out of the car down in the ditch and threw the purse in the woods." Defendant denied that she wrote out one of Rogers's stolen checks, claiming that Castro had done so, but admitted that she then passed the check at the take-out window in return for their order. Defendant again claimed that she had not planned to rob anyone, that she "never intended on any of that to happen," and that she never armed herself with a weapon or used one in any fashion on that day. She also denied threatening Cody after the offense. Defendant explained to jurors that she had initially lied in her statement to the police because she was coming off "ice," or crystal methamphetamine, which had produced a "speedy mind loss."
In his guilty plea colloquy on the day before defendant's trial, Castro acknowledged his role in the Rogers offense and confirmed that defendant had been involved as well. The state introduced a transcript of that colloquy at defendant's trial, but when it called Castro to testify, he sought to distance himself from any statements made during his plea implicating defendant, explaining that he had been nervous and "just wanted to get it over with," and that what he had meant to say was that defendant may have been present at the time but was not involved in any fashion with his snatching of Rogers's purse. Castro had signed an affidavit to that effect which the defense introduced at trial in counterpoise to the state's introduction of its witness's plea colloquy. Castro also testified that he had "no use of force, intimidation, or nothing" toward the victim, and testified that he had been armed not with one of the black powder handguns in the car but with a silver crowbar that he discarded after the offense. Castro testified that he had entered his guilty plea to armed robbery only because, "I wasn't getting any counsel to the best of my ability." However, Castro eventually admitted that while he alone had approached Rogers, defendant knew that he intended to rob someone at Wal-Mart. When asked by the prosecutor whether defendant "knew that you were armed with that gun and you took that purse," Castro replied, "Yes, sir."
In his closing argument to jurors, the prosecutor made no effort to reconcile the divergent accounts of the confrontation in the Wal-Mart parking lot given by Cody Duos and Tammy Rogers. "What's really germane here," he argued to jurors, "is whether [defendant is] involved.... No matter how you think the robbery went down, it's not really a question that it was a robbery ... that it was armed. It's not really a question that she was involved ... *295 [as] a principal to that offense ... [and] just as guilty as everybody else."
In reviewing the evidence presented at trial, the court of appeal also made no effort to resolve the discrepancies in the accounts of the actual confrontation in the parking lot. However, it concluded that the jurors "chose to believe the testimony of Defendant's young cousin, Cody, as opposed to Defendant and Castro," at least with respect to the circumstances leading up to the confrontation and the events which then took place following the offense. Smith, 42,302 at 12, 962 So.2d at 1197. Thus, evidence "that Defendant was the driver of the getaway vehicle and that Defendant was involved in the planning, commission and, later, an attempted coverup of the offense," established, "[b]y all aspects of the definition of principal to the offense," that defendant "could be found guilty as a principal based on any of her actions before, during and after the offense." Id., 42,302 at 11, 962 So.2d at 1196.
However, in determining exactly what offense defendant had committed, the court of appeal found that "[t]he evidence is insufficient ... to establish that Defendant had any knowledge or intent that Castro would arm himself with a dangerous weapon." Id., 42,302 at 12, 962 So.2d at 1197. Defendant denied any such knowledge and no other witness at trial "provide[d] any evidence that Defendant knew or anticipated that Castro would arm himself with a weapon." Id. The court of appeal thus concluded that defendant "did not have the requisite mental state ... to be a principal to armed robbery." Id. At the same time, the majority on the panel concluded that defendant was a principal to the crime of simple robbery, and not merely to a theft, because Tammy Rogers did not "give up the purse of her own will, nor was it merely taken secretly." Id., 42,302 at 14, 962 So.2d at 1198. Thus, evidence that the victim "was openly and quickly approached by a man in the heavy rain who grabbed her purse, which was in her close proximity," gave jurors a rational basis for finding "that such a situation was, at the very least, intimidating." Id. The majority decision accordingly modified defendant's conviction from armed robbery to simple robbery and remanded the case to the trial court for resentencing in accord with La. R.S. 14:65. In his dissent to the denial of rehearing, Chief Judge Brown emphasized evidence that defendant "drove the car, specifically looked for and identified a victim and immediately after the robbery passed the victim's check at KFC," and defendant's own testimony that "she saw her boyfriend with a `silver gun.'" Smith, 42,302 at 1, 962 So.2d at 1198 (Brown, C.J., dissenting from denial or rehearing). In his view, that evidence fully supported the jury's verdict and the majority had "simply reweighed the evidence which is constitutionally prohibited and reduced the conviction." Id.
As an initial matter, we agree with Chief Judge Brown that viewing the evidence in a light most favorable to the prosecution, as a reviewing court must under the due process standard of Jackson v. Virginia, 443 U.S. 307, 99 S. Ct. 2781, 61 L. Ed. 2d 560 (1979), a rational trier of fact could find from Castro's testimony that defendant knew he had a gun and from defendant's testimony that she saw Castro with a gun when he confronted the victim, that defendant was fully aware Castro would arm himself when they discussed looking for easy targets as she played the aisles in the Wal-Mart parking lot. However, even assuming, arguendo, that rational jurors would interpret the testimony to mean only that defendant observed Castro with a gun at the moment he snatched Tammy Rogers's purse and that, as appellate *296 counsel argues, she only then realized that Castro had deviated from their plan calling for an "easy snatch" by "in essence, calling an unnecessary audible," we remain in agreement with the dissent that the evidence at trial fully supported the jury's verdict that defendant was guilty as a principal to the crime of armed robbery.
Some jurisprudential support exists for the position taken by the court of appeal and defendant that defendant must have subscribed to Castro's decision to arm himself before he stepped from the car to render her a principal in the offense of armed robbery. See State v. Doucet, 93-1523, p. 6 (La.App. 3rd Cir.5/4/94), 638 So. 2d 246, 249 (reducing first degree robbery conviction to simple robbery because "[t]he evidence does not support a conclusion that the defendant knew of the existence of the knife before or during the robbery or that [the co-perpetrator] might lead the victim to believe that he was armed with a dangerous weapon.... Additionally, [the co-perpetrator] testified that the defendant was not aware that he had a knife on his person until after the robbery."); State v. Smith, 450 So. 2d 714, 716-17 (La.App. 4th Cir.1984)(reducing armed robbery conviction to simple robbery because the evidence revealed that the co-perpetrator spontaneously armed himself with a hammer belonging to the victim in the middle of the robbery and used it to intimidate the victim while defendant stood on the other side of the counter urging his accomplice to get all of the money but not mentioning the hammer). Both decisions rely on the general rule that "[a]ll principals to a crime are not necessarily guilty of the same grade of the offense. A principal may be convicted of a higher of lower degree of the crime, depending upon the mental element proved at trial." Smith, 450 So.2d at 717 (citing State v. Holmes, 388 So. 2d 722 (La.1980)). Thus, under Smith and Doucet, the requisite intent of a principal who concerns himself in a robbery by aiding and abetting another in the commission of the offense is the intent to commit either armed or simple robbery, and in the latter case, the intent of the co-perpetrator to arm himself before or during the offense may not be imputed to the principal.
However, neither Doucet nor the Fourth Circuit's Smith, nor the Second Circuit's decision in the present case for that matter, takes into account a general principle of accessorial liability that when two or more persons embark on a concerted course of action, each person becomes responsible for not only his own acts but also for the acts of the other, including "`deviations from the common plan which are the foreseeable consequences of carrying out the plan.'" State v. Smith, 98-2078, p. 7 (La.10/29/99), 748 So. 2d 1139, 1143 (quoting 2 Wayne R. LaFave and Austin Scott, Substantive Criminal Law, § 7.5, p. 212 (1986)). The rule has particular application in cases of felony murder. Thus, a simple burglary may turn into an aggravated burglary and then escalate further into a second degree felony murder well beyond the original plan of the defendant or his accomplice who then unexpectedly kills during commission of the underlying felony offense. See, e.g., State v. McFarland, 07-0026, p. 10 (La.App. 5th Cir.5/29/07), 960 So. 2d 1142, 1148 (affirming conviction for second degree felony murder in the course of an aggravated burglary because "the fact that the defendant claimed he did not know [the co-perpetrator] was armed does not absolve him from responsibility, as the risk that the unauthorized entry of an inhabited dwelling may escalate into violence and death is a foreseeable consequence of burglary which every party to the offense must accept no matter what he or she actually intended.")(citing Smith, 98-2078 *297 at 7, 748 So.2d at 1143). An armed robbery planned by defendant may also escalate into a second degree felony murder when co-perpetrator kills to facilitate his escape from the scene. State v. Wiley, 03-0884, p. 14 (La.App. 5th Cir. 4/27/04), 880 So. 2d 854, 864. Louisiana courts have also given the rule broader application beyond felony murder. See State v. Wix, 02-1493, p. 10 (La.App. 4th Cir 1/15/03), 838 So. 2d 41, 48 (defendant guilty of aggravated battery when co-perpetrator shot victim during an armed robbery because "it is foreseeable that an armed robbery victim may be shot during the perpetration of the robbery, particularly when both of the perpetrators, as in the instant case, held weapons on the victim."); but see State v. B.J.D., 35,409, pp. 9-10 (La.App. 2nd Cir.9/26/01), 799 So. 2d 563, 569 (trespassing defendant not guilty of criminal damage to property because co-perpetrator's use of box cutter to carve initials into swimming pool liner was not a foreseeable consequence of entering the property to use the pool without permission).
Professor LaFave has cautioned against applying the rule of foreseeable deviation too broadly beyond the special context of felony murder doctrine. 2 Wayne R. LaFave, Substantive Criminal Law, § 13.3(b)(2nd ed. 2002)("[G]eneral application, of the `natural and probable consequence' rule of accomplice liability is unwarranted. A's guilt as an accomplice to one crime should not per se be a basis for holding A accountable for a related crime merely because the latter offense was carried out by A's principal, for this as well would result in A's guilt of a crime as to which he did not have the requisite mental state."). In fact, some jurisdictions have modified the rules of felony murder by providing a statutory affirmative defense for the principal who participates in the underlying felony without knowledge or good reason that his co-perpetrator is armed and bent on a lethal result. See, e.g., Ark.Code Ann. § 5-10-102(b) (Michie 2002) (affirmative defense to the crime of felony murder if defendant (1) does not commit, solicit or aid in anyway the homicidal act; (2) was not armed with a deadly weapon; (3) "[r]easonably believed that no other participant was armed with a deadly weapon;" and (4) "[r]easonably believed that no other participant intended to engage in conduct that could result in death or serious bodily injury."); Conn. Gen.Stat. Ann. § 53a-54c (West 2007)(same); Colo. Rev.Stat. 18-3-102(2)(2008) (same, but adding the requirement that the defendant "[e]ndeavored to disengage himself from the commission of the underlying crime or flight therefrom immediately upon having reasonable grounds to believe that another participant is armed with a deadly weapon... or intended to engage in conduct likely to result in death or serious bodily injury.").
However, Louisiana statutory law does not provide that kind of affirmative defense in any context, and application of the foreseeable deviation rule in the present case does not carry the risk of convicting defendant of an offense for which she did not have the requisite intent. Under present law, armed robbery is a general intent, not specific intent, crime.[2]*298 An offender therefore has the requisite intent when "from the circumstances the prohibited result may reasonably be expected to follow from the offender's voluntary act, irrespective of any subjective desire on his part to have accomplished such result." State v. Elzie, 343 So. 2d 712, 714 (La.1977); R.S. 14:10. Thus, "in the case of armed robbery, when the proof shows that the perpetrator armed with a dangerous weapon causes another to surrender to him whatever was the object of the robbery, the necessary criminal intent has been furnished by the very doing of those criminal acts." Holmes, 388 So.2d at 727.
In the present case, the evidence at trial showed, and defendant does not dispute, that she and Castro drove around the Wal-Mart parking lot looking for "an easy snatch." Although by implication they were looking for targets of easy opportunity that did not call for excessive force, the offense they contemplated, purse snatching, is a crime of violence, R.S. 14:2(B)(24) that entails misappropriation by the use of force. La. R.S. 14:65.1.[3]*299 Defendant was therefore accountable for Castro's decision to arm himself with the black powder pistol before he stepped from the car even if she did not know at any point before Castro got out of the car and approached the victim that he had a weapon and would have it in hand when he snatched the victim's purse, and even if she remained behind in the car while Castro rushed towards the victim's shopping cart. Castro's decision to take the gun to increase the odds of success in the event the victim offered unexpected resistance was an entirely foreseeable consequence and inherent risk of the original plan to commit a crime of violence by snatching Tammy Rogers's purse. The crime escalated from purse snatching to armed robbery when the armed Castro rushed at the victim and snatched her purse in a face-to-face confrontation.[4] Although Rogers did not see anything in Castro's hand (whether held at his side or pointed at her head) and did not testify that she felt threatened or feared for her life, and although Castro insisted that he had used no force or violence directed towards the victim, we agree with the Second Circuit that the circumstances were sufficiently intimidating for a rational trier of fact to find that Castro's taking amounted to a robbery because an ordinary person in Rogers's position reasonably could have inferred a threat of bodily harm from the onrushing Castro if she resisted. Cf. United States v. Gipson, 383 F.3d 689, 699 (8th Cir. 2004)(for purposes of 18 U.S.C. § 2113(a), defining bank robbery as the taking "by force and violence, or by intimidation," the element of intimidation "is satisfied if an ordinary person in the position of a victim teller or bank employee reasonably could have inferred a threat of bodily harm from the robber's actions."); State v. Pasek, 691 N.W.2d 301, 306 (S.D.2004)(adopting federal objective standard of intimidation under state statute defining first degree robbery committed by means of force or fear)(citing Gipson).
Thus, even assuming that the jury did not credit Cody's testimony that Castro held out the black powder pistol aimed at the victim's head while defendant stood at his side snatching the victim's purse, the evidence, viewed in a light most favorable to the prosecution, permitted a rational trier of fact to find that Castro *300 had committed an armed robbery and that defendant was a principal to the crime because she counseled and encouraged Castro in the commission of a crime of violence and then shared in the proceeds after fleeing the scene. The decision of the court of appeal is therefore reversed, defendant's conviction and sentence for armed robbery are reinstated, and this case is remanded to the district court for purposes of execution of sentence.
DECISION OF COURT OF APPEAL REVERSED; CONVICTION AND SENTENCE REINSTATED; CASE REMANDED.
JOHNSON, J., dissents and assigns reasons.
JONES, J., dissents for reasons assigned by JOHNSON, J.
JOHNSON, J., dissents and assigns reasons.
This case involves a robbery that occurred in a Wal-mart parking lot. Raul Jorge Castro (Castro) was charged with armed robbery in violation of La. R.S. 14:64. Ryan Marie Smith (Smith) was also charged, as a principal, with armed robbery for her role in the offense. Smith and Castro were tried separately.
At Smith's trial, the victim testified that while she was unloading items from her shopping cart into her vehicle, a man exited from a white car, grabbed her purse from her shopping cart, and escaped. Smith was the driver of the vehicle. The victim testified that she saw at least two other people inside of the getaway car, but she was unable to determine whether the man who robbed her (Castro) was holding anything in his hands, and she did not see a gun. Smith testified that she did not have any knowledge that Castro planned to arm himself with a weapon or that a weapon was present in the car before the robbery. A jury found Smith guilty of armed robbery and sentenced her to twelve (12) years imprisonment at hard labor without the benefit of parole, probation, or suspension of sentence.
The Court of Appeal, Second Circuit, found that the evidence was insufficient to establish that Smith had knowledge that Castro would arm himself with a dangerous weapon to commit the robbery. The Court of Appeal noted that:
All principals to a crime are not necessarily guilty of the same grade of offense. State v. Doucet, 93-1523 (La. App. 3d Cir.5/4/94), 638 So. 2d 246. An individual may only be convicted as a principal for those crimes for which he personally has the requisite mental state. State v. Pierre, 93-0893 (La.2/3/94), 631 So. 2d 427; State v. King, 06-554 (La.App. 5th Cir.1/16/07), 951 So. 2d 384. To be a principal to an armed robbery, the State must prove beyond a reasonable doubt that a defendant knew that her co-offender would arm himself with a dangerous weapon. Doucet, supra.[1]
The Court of Appeal properly found that the evidence was sufficient to convict Smith of simple robbery because this robbery involved (1) a taking, (2) of something of value, (3) from a person or in the immediate control of another, (4) by the use of force or intimidation, (5) but not armed with a dangerous weapon. La. R.S. 14:65.
Given the facts present in this case, the defendant's conviction was properly modified to simple robbery. Finding no error, I would not disturb the Court of Appeal judgment.
NOTES
[1] Judge Benjamin Jones, of the Fourth Judicial District Court, assigned as Justice Pro Tempore, participating in the decision.
[2] Before the 1983 amendment of R.S. 14:64, armed robbery was a specific intent crime because it required proof of a theft from the victim, i.e., an intent to deprive the victim permanently of his or her personal possessions. See State v. Johnson, 368 So. 2d 719, 722 (La. 1979). However, the 1983 amendment of R.S. 14:64 substituted "taking" for "theft" and armed robbery thereby became a general intent crime. State v. Gordon, 504 So. 2d 1135, 1142, n. 4 (La.App. 5th Cir.1987). However, even under former law, the requisite specific intent was to commit a theft, not to use a dangerous weapon. The latter element has always been a matter of general intent, i.e., the offender intends to arm himself because in fact he arms himself before, during, or immediately after, committing a robbery.
[3] Other states have taken divergent views of whether the mere snatching of a victim's personal effects without any additional force directed toward the victim constitutes robbery or larceny. See Peter G. Guthrie, Annot., Purse Snatching as Robbery or Theft, 42 A.L.R. 3d 1381, 1383 (1972)("[T]he rule prevailing in most jurisdictions [is] that the mere snatching or sudden taking of property from the person of another does not itself involve such force, violence, or putting in fear as will constitute robbery[.]"); see also 3 Wayne R. LaFave Substantive Criminal Law, § 20.3(d), pp. 181-82 (2nd ed. 2003)("The great weight of authority ... supports the view that there is not sufficient force to constitute robbery when the thief snatches property from the owner's grasp so suddenly that the owner cannot offer any resistance to the taking.")(footnote omitted).
However, legislatures remain free to denominate taking by sudden snatching as a species of robbery and not of larceny. Thus, Florida defines the offense of robbery by sudden snatching as the taking of money or other property from the victim's person when "in the course of the taking, the victim was or became aware of the taking." Fla. Stat. Ann. § 812.131(1)(West 2000); see Brown v. State, 848 So. 2d 316 (Fla.App. 2nd Dist.2003). The statute specifically provides that the state need not show that the offender "used any amount of force beyond that effort necessary to obtain possession of the money or other property," or that the victim offered any resistance or suffered any injury.
Similarly, in Louisiana, the crime of purse snatching is defined as "the theft of anything of value contained within a purse or wallet at the time of the theft, from the person of another or which is in the immediate control of another, by use of force, intimidation, or by snatching, but not armed with a dangerous weapon." (emphasis added). The offense constitutes a particular and more serious species of misappropriation with violence when the offender is not armed with a dangerous weapon, i.e., simple robbery in violation of La. R.S. 14:65, because it carries a maximum term of imprisonment of 20 years at hard labor, nearly three times as great as the maximum penalty provided for simple robbery.
However, unlike the Florida statute, R.S. 14:65.1 does not require that the victim know at the time of the taking that his or her property is taken or snatched. It therefore remains possible in Louisiana to "snatch" a victim's purse from her possession without her awareness at the time of the taking. See State v. Anderson, 418 So. 2d 551, 552 (La.1982)(defendant guilty of purse snatching when he grabbed victim's purse placed on floor between her legs as she sat watching a football game unaware of the taking until after it occurred); compare McNearney v. State, 210 Ga.App. 582, 436 S.E.2d 585 (1993)(evidence that victim was leaning over and unloading groceries into her car from the opposite end of her shopping cart when defendant grabbed her purse from the cart without her knowledge did not support conviction for robbery by snatching; victim learned of the crime only when bystander informed her that defendant had taken her purse). An anomalous consequence of the rule in Anderson is that a defendant may commit the more serious offense of purse snatching under circumstances in which he does not commit the less serious offense of simple robbery because the offense did not entail the use of any more force than the act of snatching or any act of intimidation to separate the victim from her property.
[4] Even assuming that jurors did not credit the testimony of Cody Duos that Castro raised his gun to the head of the (unaware) victim, R.S. 14:64(A), defining the crime of armed robbery, does not require that the offender "use" a dangerous weapon during commission of the offense, or accomplish the robbery by means of a dangerous weapon; it requires proof only that the offender was "armed" during the offense. Compare Bailey v. United States, 516 U.S. 137, 116 S. Ct. 501, 133 L. Ed. 2d 472 (1995)(18 U.S.C. § 24(c)(1), which proscribes "use" of a firearm in relation to a drug trafficking crime requires proof that the defendant actually employed a gun in relation to the drug offense.); cf. Ga. Code Ann. § 16-8-41(a)(2007)("A person commits the offense of armed robbery when, with intent to commit theft, he or she takes property of another from the person or the immediate presence of another by use of an offensive weapon, or any replica, article, or device having the appearance of such weapon.").
In the present case, and in terms of the potential danger to Tammy Rogers, it made little difference whether Castro pointed his pistol at the victim's head as he snatched her purse or held it at the ready at his side. In either case, he was "armed" during commission of an offense which involved misappropriation accompanied by the use of force or intimidation.
[1] State v. Smith, 42,302, (La.App. 2 Cir. 8/15/07) 962 So. 2d 1190, 1194. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614098/ | 939 So. 2d 926 (2006)
Pat GARTMAN
v.
LIMESTONE COUNTY BOARD OF EDUCATION.
2041018.
Court of Civil Appeals of Alabama.
February 3, 2006.
Certiorari Denied April 14, 2006.
*927 Gregory B. Stein of Stein, Brewster & Pilcher, L.L.C., Mobile, for appellant.
J.R. Brooks of Lanier Ford Shaver & Payne, P.C., Huntsville, for appellee.
David R. Boyd, Dorman Walker, and JoClaudia Moore of Balch & Bingham, LLP, Montgomery, for amicus curiae Alabama Association of School Boards, in support of the appellee.
Alabama Supreme Court 1050633.
THOMPSON, Judge.
Pat Gartman appeals from the trial court's judgment entered on the pleadings, upholding the decision of the Limestone County Board of Education ("the Board") to terminate Gartman's employment as a principal in the Limestone County school system. Gartman's appeal focuses on whether § 16-24B-3(c), a part of the "Teacher Accountability Act," § 16-24B-1 et seq., Ala.Code 1975 ("the Act"), applies to principals serving on a probationary basis in a local school system. We conclude that that section does not apply to principals serving on a probationary basis, and we affirm the trial court's judgment.
The facts of this case are neither complex nor in dispute. In July 2003, the Board hired Gartman to serve as a principal in the Limestone County school system. Gartman, who had no previous experience as a principal in the Limestone County school system, entered into an employment contract with the Board. The contract, which referred to Gartman as the "contract principal," specified that Gartman was to serve a probationary period until the end of the 2004-2005 school year.[1] The contract stated that, at the end of the probationary period, the Board could "terminate the contract principal for any reason or without a stated reason." The contract further stated that if the Board did not terminate Gartman's employment at the end of the probationary period, she would be employed as a principal for a three-year term.
On May 24, 2005, the Board voted unanimously to terminate Gartman's employment as a principal. That same day, the superintendent of the Board notified Gartman of the Board's decision by certified letter.[2] On May 31, 2005, Gartman filed a complaint in the trial court, alleging that § 16-24B-3(c), Ala.Code 1975, required the Board to vote to terminate her employment at least 90 days before the end of the 2004-2005 school year. On June 17, 2005, the Board answered Gartman's complaint and asserted that the § 16-24B-3(c) did not apply to contract principals serving during a probationary period. Also on that date, the Board filed a motion for a judgment on the pleadings, see Rule 12(c), Ala. R. Civ. P.; the Board submitted a *928 brief in support of that motion. In its brief, the Board asserted that § 16-24B-3(c) did not apply to principals such as Gartman who were serving during a probationary period. Gartman later filed a brief in response to the Board's motion, and the Board filed a reply brief. On August 11, 2005, the trial court heard oral arguments from the parties' attorneys. After considering those arguments, the trial court granted the Board's motion and entered a judgment on the pleadings in favor of the Board. This appeal followed.
We review a trial court's entry of a judgment on the pleadings de novo. Harden v. Ritter, 710 So. 2d 1254, 1255 (Ala. Civ.App.1997). A court reviewing a judgment on the pleadings accepts the facts stated in the complaint as true and views them in the light most favorable to the nonmoving party. Id. at 1255-56.
As she did in the proceedings below, Gartman argues on appeal that, pursuant to § 16-24B-3(c), the Board had a duty to vote to terminate her employment as a principal at least 90 days before the end of the 2004-2005 school year and that the Board's failure to do so caused the termination of Gartman's employment to be void. Section 16-24B-3, Ala.Code 1975, provides, in pertinent part:
"(a) Any other provision of law to the contrary notwithstanding, persons employed as principals in the public schools in Alabama on or after July 1, 2000, may, at the election of the employing board, be employed as probationary principals for up to one full contract year; provided, however, that if such person is being employed as a principal for the first time, such probationary period may be for up to two full contract years. After completion of such probationary period, the same employing board shall either offer the probationary principal not less than a three-year contract pursuant to this section or terminate the probationary principal for any reason, or without a stated reason, as the case may be. In the case of a probationary principal who is terminated prior to the end of the school year, the probationary principal shall be entitled to the hearing process as described in this section. Any contract principal hired on or after July 1, 2000, to work in the capacity of a contract principal in a public school in the state shall be properly certified and shall be employed pursuant to a written contract for an initial period of not less than three years. The initial contract of not less than three years may only be canceled for cause as described in subdivision (1) of subsection (e). . . .
"(b) Subject to the procedures described in subsection (c), in the case of a contract principal after the initial term of the contract, the contract shall be renewed for a period not less than three years, and shall contain a provision for cancellation during the term of the contract only for just cause, described in subdivision (1) of subsection (e).
"(c) Notwithstanding whether the contract is the initial contract or otherwise, should the chief executive officer make a recommendation to the employing board followed by a majority vote of the board not to offer a new, renewed, or extended contract to the contract principal, the vote of the employing board shall be made at least 90 days before the end of the existing contract. The recommendation shall contain written notice of the decision of the chief executive officer and the reasons for the decision to nonrenew the contract. Notice shall be provided to the contract principal either by personal service or by certified mail, return receipt requested, mailed to the last known address of the contract *929 principal. The decision of the chief executive officer and the employing board may be based on any reason except personal or political reasons."
(Emphasis added.)
The sole issue Gartman raises on appeal is whether § 16-24B-3(c) applies to probationary principals, which is a matter of statutory interpretation. "It is a well-settled rule of statutory construction that courts ascertain the Legislature's intent in enacting a statute from the language used in the statute itself, as well as from the reason for the statute and the goals the Legislature seeks to accomplish through the statute." Alabama Bd. of Pardons & Paroles v. Brooks, 802 So. 2d 242, 247 (Ala. Civ.App.2001) (citing McGuire Oil Co. v. Mapco, Inc., 612 So. 2d 417 (Ala.1992)). Words used in a statute are to be given their natural, plain, ordinary, and commonly understood meaning. IMED Corp. v. Systems Eng'g Assocs. Corp., 602 So. 2d 344, 346 (Ala.1992). "Further, it is well established that `"[s]ections of the Code dealing with the same subject matter are in pari materia. As a general rule, such statutes should be construed together to ascertain the meaning and intent of each."'" State v. Amerada Hess Corp., 788 So. 2d 179, 183 (Ala.Civ.App.2000) (quoting New Joy Young Rest., Inc. v. State Dep't of Revenue, 667 So. 2d 1384, 1387 (Ala.Civ.App.1995) (quoting in turn Locke v. Wheat, 350 So. 2d 451, 453 (Ala. 1977))). "In construing a statute, the court must consider the entire statute and not an isolated part, giving to every clause effect in light of the subject matter and purpose of the enactment." Standard Oil Co. v. State, 55 Ala.App. 103, 111, 313 So. 2d 532, 539 (Civ.1975). "Statutory construction dictates that in construing a statute, a court must, if possible, avoid a construction that would place statutes in conflict with other statutes, and statutes should be resolved in favor of each other, when possible, so as to form one harmonious plan." Bryce Hosp. Credit Union, Inc. v. Warrior Dodge, Inc., 50 Ala.App. 15, 21, 276 So. 2d 602, 607 (Civ.1973).
Section 16-24B-2(2), defines "contract principal" as "only those persons hired on or after July 1, 2000, and certified for the position of principal as prescribed by the State Board of Education and who are employed by an employing board as the chief administrator of a school. . . ." Section 16-24B-2(8), defines "probationary principal" as "[a]ny principal hired for the first time in any local school system as a principal on or after July 1, 2000." Gartman argues that the definition of "contract principal" used in § 16-24B-2(2) describes her status because she was hired as a principal, the chief administrator of a school, after July 1, 2000. Gartman further argues that, because she was serving as a probationary principal, as defined by § 16-24B-2(8), her status met both the definition of a contract principal and a probationary principal; therefore, she contends, a "probationary principal" is a "subspecies of contract principal." As such, Gartman argues that she was entitled to the 90-day notice afforded contract principals by § 16-24B-3(c).
In support of her argument, Gartman maintains that the opening language of § 16-24B-3(c) stating that "[n]otwithstanding whether the contract is the initial contract or otherwise" suggests that § 16-24B-3(c) applies to both contract principals and probationary principals. Gartman asserts that because the Act's definition section, § 16-24B-2, defines "contract principal" and "probationary principal" but not "initial contract," the term "initial contract" should be given its plain meaning when read in the statute. See DeKalb County LP Gas Co. v. Suburban Gas, Inc., 729 So. 2d 270, 275 (Ala.1998) (noting that *930 "[i]f the language of the statute is unambiguous, then there is no room for judicial construction and the clearly expressed intent of the legislature must be given effect")(internal citations omitted). Merriam-Webster's Collegiate Dictionary 643 (11th ed.2003) defines "initial" as: "of or relating to the beginning; . . . [f]irst." Gartman argues that her contract was her first contract and, therefore, that it fit within the parameters of § 16-24B-3(c). That argument cannot succeed for at least two reasons.
Gartman's argument fails to acknowledge the manner in which the term "initial contract" is used in the Act: § 16-24B-3(a) provides that a person hired as a principal for the first time may serve for a probationary period of "two full contract years." Section 16-24B-3(a) further states that contract principals "shall be employed pursuant to a written contract for an initial period of not less than three years." Thus, § 16-24B-3(a) distinguishes between a "probationary" principal and a principal serving his or her "initial" contract as a contract principal because the probationary period can last up to two years while the initial contract for a contract principal can be no less than three years. It is clear that § 16-24B-3(a) uses the term "initial contract" in relation to a principal who is serving under the terms of his or her first contract as a contract principal after the completion of his or her probationary period.
Further, if read in isolation, the opening language of § 16-24B-3(c) "[n]otwithstanding whether the contract is the initial contract or otherwise" would seem to support Gartman's argument. We cannot, however, read a portion of a statute in isolation. See Standard Oil Co. v. State, supra. Rather, we must examine the remainder of § 16-24B-3(c), which does not support Gartman's argument. Pursuant to § 16-24B-3(c), the notice sent to a contract principal whose employment has been terminated "shall contain written notice of the decision of the chief executive officer and the reasons for the decision to nonrenew the contract." Pursuant to § 16-34B-3(a), a probationary principal's employment can be terminated for "any reason, or without a stated reason. . . ." Thus, if we accepted Gartman's interpretation, we would be placing § 16-34B-3(a) in direct conflict with § 16-24B-3(c) because one subsection requires notice of the board's reasons for terminating the principal's employment while the other subsection expressly allows the board to withhold the reasons, if any, behind its decision to terminate a principal's employment. We are bound, however, to read the subsections in such a way as to avoid such a conflict and to promote one harmonious plan. See Bryce Hosp. Credit Union, Inc. v. Warrior Dodge, Inc. supra.
Also, contrary to Gartman's interpretation of the Act, § 16-24B-3(e), Ala.Code 1975, specifically lists several reasons for which a contract principal's employment can be terminated. Section 16-24B-3(a) expressly provides that probationary principals can be terminated "for any reason," further distinguishing between contract principals and probationary principals. Because all of the sections of the Act deal with the same subject matter, we are bound to read all of the sections of the Act together. See State v. Amerada Hess Corp., supra. The manner in which the terms "initial contract," "probationary principal," and "contract principal" are used and/or defined in the Act precludes the interpretation advanced by Gartman. See DeKalb County LP Gas Co. v. Suburban Gas, Inc., supra; and Alabama Bd. of Pardons & Paroles v. Brooks, supra. Accordingly, we decline to extend the 90-day notice requirement of § 16-24B-3(c) to probationary principals because to do so *931 would be contrary to the Legislature's intent as expressed in the Act.
AFFIRMED.
CRAWLEY, P.J., and PITTMAN and BRYAN, JJ., concur.
MURDOCK, J., concurs in the result, without writing.
NOTES
[1] As discussed infra, § 16-24B-2, Ala.Code 1975, defines the terms "contract principal" and "probationary principal," thus distinguishing between the two.
[2] Though the actual last day of Gartman's employment period, as defined in her contract, is disputed by the parties, there is no dispute that May 24, 2005, was less than 90 days from the end of that period. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614092/ | 111 Wis. 2d 497 (1983)
331 N.W.2d 320
STATE of Wisconsin, Plaintiff-Respondent,[]
v.
HOLLAND PLASTICS COMPANY, MacArthur Company, Johnson-Wagner-Isley-Widen and Hipp, Inc., Orville E. Madsen & Son, Inc., and Ettel and Franz Company, Defendants-Appellants.
No. 82-024.
Supreme Court of Wisconsin.
Argued February 28, 1983.
Decided March 29, 1983.
*498 For the appellants, Holland Plastics Company, MacArthur Company and Orville E. Madsen & Son, Inc., there were joint briefs by Richard A. Hollern, Robert Horowitz, Jeffrey M. Gallagher and Stafford, Rosenbaum, Rieser & Hansen, Bradley D. Armstrong, Barbara J. Swan and Brynelson, Herrick, Gehl & Bucaida, all of Madison, Robert D. Sullivan and Merten & Schwemer, S.C., Milwaukee, and for appellants, Johnson-Wagner-Isley-Widen and Hipp, Inc., and Ettel and Franz Company, there were joint briefs by John F. Jenswold and Jenswold, Studt, Hanson, Clark & Kaufmann and Tom *499 Jacobs and Frank Coyne Law Offices, all of Madison, and oral argument by Mr. Horowitz and Allen A. Arntsen.
For the respondent the cause was argued by John J. Glinski, assistant attorney general, with whom on the brief was Bronson C. La Follette, attorney general.
On certification from court of appeals.
DAY, J.
This is an appeal from a nonfinal order of the circuit court for Dane county, William F. Eich, Judge, which denied the defendants' motion for summary judgment. The court of appeals granted the defendants' petition for leave to appeal pursuant to sec. 809.50, Stats. 1979-80. The court of appeals then certified the case to this court pursuant to sec. (rule) 809.61, Stats. 1979-80. The certification request was granted and the appeal accepted on October 12, 1982.
The issues considered on appeal are:
1) Is an action by the state for negligent construction and breach of contract governed by the ten year statute of limitations contained in sec. 893.18(6), Stats. 1971,[1] (now sec. 893.87 (1981-82), or by sec. 893.19(5) 1971,[2] and sec. 893.19(3), 1971,[3] (now secs. 893.52 and 893.43 1981-82, respectively)?[4]
*500 2) If the state's action for negligent construction is governed by the six year limitation in sec. 893.19(5) does that statute bar the state's claim here?
3) If the state's action for breach of contract is governed by the six year limitation in sec. 893.19(3), does that statute bar the state's claim here?
We conclude that the action by the state is governed by the six year limitations in sec. 893.19(5) and 893.19(3), Stats. We further conclude that sec. 893.19(3), Stats., bars the state's claim for damages for breach of contract. We remand the case to the trial court for a determination as to whether the state's action for negligent construction is barred by sec. 893.19(5), Stats.
This case involves problems which occurred in the construction of the roof of the Creative Communications Building on the campus of the University of Wisconsin Green Bay.
Construction of the building was commenced in late 1970. According to the deposition of Mr. Gerald Germanson, chief of project management for the Wisconsin Department of Administration, Division of State Facilities Management, the "basic contract work" for the roof was completed by August 23, 1973.
Prior to the completion of the roof, construction observation reports dated January 24, March 28 and April 4, 1973, documented roof leakage in the building. These reports were made out by state employees.
The building was substantially completed on November 28, 1973. This action was commenced on October 31, 1979.
*501 The complaint alleged that defendants Holland Plastics Company (Holland) and MacArthur Company (MacArthur) were negligent in the manufacture and sale of roof insulation which was used in the construction of the building. The complaint also alleged that defendant Ettel and Franz Company (Ettel) was negligent in using the wrong type of asphalt in the construction of the roof. Finally, the complaint alleged that defendants Johnson-Wagner-Isley-Widen and Hipp, Inc. (Johnson) and Orville E. Madsen & Son, Inc. (Madsen) acted negligently with regard to the construction of the roof and that both breached their contracts with the state involving the construction of the building.
Following a series of interrogatories and depositions, the defendants moved for summary judgment on the ground that the statute of limitations barred this action because the action was commenced more than six years after the cause of action accrued. The state countered by arguing that the applicable statute of limitations was that found in sec. 893.18 (6), Stats. 1971, and that section gave the state ten years to commence the action. The trial court found sec. 893.18 (6) to be the applicable statute and determined that the action was commenced within the time limitations set out therein. The motion for summary judgment was therefore denied. The defendants appealed.
Under sec. 893.18(6), Stats. 1971, the state is given ten years to commence an action in its favor "when no other limitation is prescribed in this chapter [Chap. 893 (1971)]." In Gilman v. Northern States Power Co., 242 Wis. 130, 134-35, 7 N.W.2d 606 (1943), this court determined that the language of this statute "manifestly was intended . . . to provide that the general limitation statutes . . . should apply to the state and that a ten-year limitation was created to cover any case by the state not falling within the general limitation statutes or any *502 special statutes." The question is whether the interpretation of sec. 893.18 (6), Stats., which is set out in Gilman controls this case. We conclude it does.
Gilman involved an action by the Village of Gilman to recover funds which had allegedly been paid illegally to a utility for line construction. The action was commenced almost fifteen years after the money had been paid out. The village argued that no statute of limitations applied to the State or its subdivisions. The court examined this argument and rejected it. In so doing the Court held that the general limitation statutes applied to both the state and its subdivisions and the ten-year limitation was created to cover actions not falling under any other statute.
The state now argues that the language of Gilman is dicta because the state was not a party to the action. However, this argument ignores the fact that the village argued, and the court apparently accepted the argument,[5] that a subdivision of the state should stand in the same position as the state regarding the applicability of the statute of limitations. Thus, the court in determining which statute of limitation applied to actions by the village also determined which applied to the state.
The state next argues that even if the language in Gilman is not dicta, the holding in that case was based on an erroneous examination of the statute's legislative history and thus the holding was in error. However, the holding in Gilman did not rest upon its examination of the legislative history but rather relied on the language of the statute to show the "manifest" intent of the legislature.
*503 The court's reference to legislative history in Gilman was not used to aid in a determination of what legislative intent was in creating the statute. Rather, the court looked at the words of the statute and determined that they were sufficiently clear and unambiguous so that it could properly determine that which was "manifestly intended by the enactment of the act." The court's use of the word "manifestly"[6] here is significant because it shows that it was the wording of statute upon which the court relied.
[1]
We find the language of the statute clear and unambiguous in setting a ten-year limitation for the state only when "no other limitation is prescribed." This court has stated repeatedly that where the language of a statute is clear, it is improper to resort to extrinsic aids for the purpose of statutory construction. Swanson Furniture v. Advance Transformer, 105 Wis. 2d 321, 326, 313 N.W.2d 840 (1982); State v. Derenne, 102 Wis. 2d 38, 45, 306 N.W.2d 12 (1981); Milwaukee v. Lindner, 98 Wis. 2d 624, 632, 297 N.W.2d 828 (1980). The state's attempt to use legislative history to support its position is not persuasive in the face of the clear language of the statute.
The state next argues that the Gilman court's interpretation of the language in sec. 893.18(6) was explicitly rejected in Estate of Allen, 43 Wis. 2d 260, 168 N.W.2d 869 (1969). In Allen, the state sought to enforce a claim under sec. 46.10, Stats., against a mother for the costs of taking care of her child who had been placed in a state institution for the mentally retarded. Relying upon four earlier decisions,[7] the court held that a ten year statute *504 of limitations applied to the claims by the state under sec. 46.10. Allen, 43 Wis. 2d at 264. The court considered Gilman but determined it to be inapplicable because the state was not a party in Gilman and because no statutory liability under sec. 46.10 was involved.
The fact that the state was not a party in Gilman was shown previously to be insignificant in determining the validity of the court's interpretation of sec. 893.18 (6). It is clear that the court in Allen did not overrule the holding in Gilman but rather distinguished it out of deference to the principle of stare decisis. The most that can be said of the Allen case is that it reaffirmed a very narrow exception to the general rule set out in Gilman.
[2]
We conclude that sec. 893.18 (6), Stats. 1971, (now sec. 893.87 1981-82), sets a ten-year limitation for actions by the state only where the action is of such a type that it does not fall under any other of the limitations set out in the limitations chapter of the statutes.
Because of our holding above, it is clear that sec. 893.19 (5), Stats. 1971, and sec. 893.19 (3), 1971, governed this action. The question thus becomes whether those statutes operate to bar this action.
[3]
As an initial matter, the defendants ask this court to refuse to consider these questions contending that these are issues which were raised by the state for the first time on appeal. Generally, issues not raised or considered by the trial court will not be considered for the first time on appeal. Brown County v. H&SS Dept., 103 Wis. 2d 37, 42, 307 N.W.2d 247 (1981); Wirth v. Ehly, 93 Wis. 2d 433, 443, 287 N.W.2d 140 (1980).
These questions were not considered by the trial court because of its determination that the ten year rather *505 than six year statute of limitations applied. Further, the issues are not new for the defendants themselves urged the trial court to grant their motion for summary judgment because the six year statutes barred the action. All that is new is that the state now claims that even if the six year statutes apply, its claims are nevertheless not barred. This is merely an additional argument on issues already raised by the defendants and the general rule against raising issues for the first time on appeal does not prevent the state from making its argument in this court.
The second issue considered on appeal is whether the state's action for negligent construction is barred by the six-year limitation in sec. 893.19 (5), Stats. 1971?
[4]
As this court stated in Wis. Natural Gas v. Ford, Bacon & Davis Constr., 96 Wis. 2d 314, 324, 291 N.W.2d 825 (1980):
"a cause of action accrues and the statute of limitations (sec. 893.19 (5), Stats.) begins to run when the evidence of injury to property, resulting from the negligent act upon which the action is based, is sufficiently significant to alert the injured party to the possibility of a defect. The injury need not, however, be of such magnitude as to identify the causal factor." quoting Tallmadge v. Skyline Construction, Inc., 86 Wis. 2d 356, 359, 272 N.W.2d 404 (Ct. App. 1978).
[5]
The determination of when a cause of action accrues under this statute is a factual one. The trial judge did not engage in such a determination because of his decision that the ten year statute applied. Based upon our review of the motion for summary judgment and the accompanying documents, we cannot say as a matter of law that the three documented leaks which occurred *506 prior to the completion of the building's roof were sufficiently significant to alert the state to the possibility of a defect in the roof. We therefore remand this question to the trial court for further proceedings on this question.
The final question on review is whether the state's action against Johnson and Madsen for breach of contract is barred by the six-year limitation in sec. 893.19 (3), Stats. 1971?
[6]
In an action for breach of contract, the cause of action accrues and the statute of limitations begins to run from the moment the breach occurs. Milwaukee County v. Schmidt, Garden & Erikson, 43 Wis. 2d 445, 455, 168 N.W.2d 559 (1968); Denzer v. Rouse, 48 Wis. 2d 528, 531, 180 N.W.2d 521 (1970). This is true whether or not the facts of the breach are known by the party having the right to the action. 48 Wis. 2d at 531.
The state contends that the breach could not have occurred until the building was substantially completed (here November 28, 1973) because until that time there was no representation made that the building was without defect. To support this argument, the State relies on Krueger v. V.P. Christianson Silo Co., 208 Wis. 460, 240 N.W. 145 (1932). In Krueger there is language suggesting that for purposes of the statute of limitations, a breach of contract occurs when a job is completed and a defect exists.
The court examined the meaning of this language in the Milwaukee County case. The appellant in Milwaukee County argued that, under the holding in Krueger, the cause of action did not accrue until the respondents had completed their contract. The court in Milwaukee County rejected this argument after determining that the language in Krueger supported the appellants position only when taken out of context. The court then went on to reaffirm that it is the moment the breach occurs that is the time a cause of action in contract accrues.
*507 [7]
In this case the breach of contract relates to Johnson and Madsen's contractual obligations with regard to the roof of the building. From the information before us, we cannot say specifically when the breach of contract occurred. However, it is clear that the breach could have occurred no later than August 23, 1973, because that is the date on which the roof was basically completed. That date is six years and two months prior to the commencement of the action. Therefore, the contract action was barred by the statute of limitations in sec. 893.19 (3).
By the Court. Order reversed and cause remanded for further proceedings not inconsistent with this opinion.
NOTES
[] Motion for reconsideration denied, without costs, on May 3, 1983.
[1] Section 893.18(6), Stats. 1971:
"893.18 Within 10 years. . . . (6) Any action in favor of the state when no other limitation is prescribed in this chapter. No cause of action in favor of the state for relief on the ground of fraud shall be deemed to have accrued until discovery on the part of the state of the facts constituting the fraud."
[2] Section 893.19(5), Stats. 1971:
"893.19 Within 6 years; one year notice of damage by railroad. Within 6 years: . . . (5) An action to recover damages for an injury to property, or for an injury to the character or rights of another, not arising on contract, except in case where a different period is expressly prescribed."
[3] Section 893.19(3), Stats. 1971:
"893.19 Within 6 years; one year notice of damage by railroad. Within 6 years: . . . (3) An action upon any other contract, obligation or liability, express or implied, except those mentioned in ss. 893.16 and 893.18."
[4] The parties agree that sec. 893.155, Stats. 1971, (now sec. 893.89, 1981-82), does not apply. This statute was declared unconstitutional in Kallas Millwork Corp. v. Square D Co., 66 Wis. 2d 382, 393, 225 N.W.2d 454 (1975). The statute was amended in Chap. 335, Laws of 1975. This court, in Hunter v. Sch. Dist. of Gale-Ettrick-Trempealeau, 97 Wis. 2d 435, 293 N.W.2d 515 (1980) held that sec. 893.255 as amended was applicable only to causes of action accruing after June 13, 1976.
[5] The following language in Gilman convinces us on this point:
"As an action such as the instant one would be barred if brought by the state, it is also barred by a subdivision of the state, as exemption to the state under the general rule relied on by the village would be the only possible reason for exempting the village." 242 Wis. at 135.
[6] "Manifest" is defined in Webster's Third New International Dictionary (1961) as "capable of being easily understood or recognized at once by the mind."
[7] Estate of Heller, 246 Wis. 438, 17 N.W.2d 572, 18 N.W.2d 594 (1945); Estate of Cameron, 249 Wis. 531, 25 N.W.2d 504 (1946); Derouin v. State Dept. of Public Welfare, 262 Wis. 559, 55 N.W.2d 871 (1952); Guardianship of Dach, 272 Wis. 120, 74 N.W.2d 766 (1956). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614109/ | 939 So. 2d 1095 (2006)
ADRIAN KEVIN GRAY, SR., Appellant,
v.
STATE OF FLORIDA, Appellee.
Case No. 1D05-3476.
District Court of Appeal of Florida, First District.
Opinion filed September 13, 2006.
Nancy A. Daniels, Public Defender, and Richard M. Summa, Assistant Public Defender, Tallahassee, for Appellant.
Charlie Crist, Attorney General, Robert R. Wheeler, Chief Criminal Appeals, and Carolyn J. Mosley, Assistant Attorney General, Tallahassee, for Appellee.
PER CURIAM.
Adrian Gray appeals his conviction for kidnapping and sentence as a prison releasee reoffender (PRR), contending that the trial court erred by (I) failing to enter judgment of acquittal, because the state failed to prove that he kidnapped the victim, (II) failing to grant his motion to suppress evidence, and (III) finding him to be a PRR. We affirm on Issues II and III without comment, but reverse his conviction for kidnapping, because the evidence did not prove that Gray had confined the victim in any degree that exceeded the parameters of the robbery.
In Faison v. State, 426 So. 2d 963 (Fla. 1983), the supreme court ruled that if a victim is confined for the purpose of facilitating the commission of another crime, the confinement, to constitute the separate offense of kidnapping,
(a) Must not be slight, inconsequential and merely incidental to the other crime; (b) Must not be the kind inherent in the nature of the other crime; and (c) Must have some significance independent of the other crime in that it makes the other crime substantially easier of commission or substantially lessens the risk of detection.
Id. at 965 (quoting Kansas v. Buggs, 547 P.2d 720, 731 (Kan. 1976)).
The evidence at trial discloses that Gray entered a convenience store in Fernandina Beach on February 24, 2004, at around 11:00 p.m., wearing a mask. He seized the clerk by the hair, threatening to blow her head off if she tried to do anything. He continued to pull the victim by her hair to the office where the keys were located, then pulled her by the hair to the front door and ordered her to lock it. Leaving the keys in the front door, Gray forced her behind the counter and ordered her to open the two registers. He then took money from each, and directed the victim to lie face down between the registers and open the safe. She replied she could not open it, but she did retrieve two bills from the money drop. Gray then ordered her to remove all of her clothing except her undergarments. He further advised her he had a friend inside the store, and if she attempted to leave, the friend would blow her head off. The clerk heard him walk around the counter, heard the keys jingle, then the doorbell, and after listening for another 20 seconds, she pushed the panic button to notify the police, called 911, and dressed herself. The clerk reported that the robber took a large set of store keys, but he did not lock the door when he left. Neither did he make any sexual advances toward her, nor threaten her sexually.
In our judgment the above facts do not satisfy the Faison test to support a separate conviction for kidnapping, because Gray's movement and confinement of the clerk were incidental to the robbery and ceased once he left the store. See Berry v. State, 668 So. 2d 967, 969 (Fla. 1996) (observing that binding the victims satisfied the Faison test, whereas if the robbers had simply held the victims at gunpoint, or had confined them in a room and ordered them not to leave, such confinement would cease naturally with the robbery); Walker v. State, 604 So. 2d 475, 477 (Fla. 1992) (lying down or moving to the back of the store during a robbery was "slight, inconsequential, and merely incidental to the robberies"); McCutcheon v. State, 711 So. 2d 1286 (Fla. 4th DCA 1998) (ordering victim into a storeroom where the safe was located, and beating her because she would not open the safe, did not extend beyond commission of the robbery); Formor v. State, 676 So. 2d 1013 (Fla. 5th DCA 1996) (confining victims to motel bathrooms with threats to kill them if they came out was incidental to the robberies); Elozar v. State, 825 So. 2d 490, 491 (Fla. 5th DCA 2002) (confining employees in an open safe during robbery was not kidnapping, because they were "free to come out when the armed robbers left the premises"); Frederick v. State, 931 So. 2d 967 (Fla. 3d DCA 2006) (confining two employees in a closed freezer for duration of the robbery was insufficient to establish kidnapping).
In the case at bar, Gray violently dragged the victim around the store for the purpose of finding the keys that would open the cash register and safe and lock the door. While Gray made threats on her life, he did not bind her. Notwithstanding his directions to the clerk requiring her to lock the store and remove her clothes, such acts did not extend beyond the actual commission of the robbery, because when Gray left the store, the door was unlocked with the victim's clothes inside, thereby enabling her to dress immediately. As such, her confinement did not exceed the scope of the robbery.
Although we acknowledge that forcing the victim to undress appears to satisfy the third Faison requirement, because Gray may have believed it would make his escape easier, by slowing her ability to go outside the store and observe the route of his departure, such act was rendered incidental to the robbery due to his leaving the clothing accessible to her. Thus, the disrobing was comparable to placing her in a separate room and closing the door with orders for her not to come out, which the court ruled in Berry was not kidnapping, because such confinement would "cease naturally with the robbery." Berry, 668 So. 2d at 969. If Gray had taken or hidden the victim's clothing, the disrobing would be more comparable to tying her up and leaving her "in a precarious and vulnerable state for a period beyond the robbery." Id.
We therefore reverse the kidnapping conviction and remand the case with directions for the trial court to impose the lesser-included offense of false imprisonment. § 924.34, Fla. Stat. (2004). "False imprisonment" is defined as "forcibly, by threat, or secretly confining, abducting, imprisoning, or restraining another person without lawful authority and against her or his will." § 787.02(1)(a), Fla. Stat. (2004) (emphasis added). In contrast, "kidnapping" is defined as "forcibly, secretly, or by threat confining, abducting, or imprisoning another person against his or her will and without lawful authority," with specific intent to commit another offense. § 787.01(1)(a), Fla. Stat. (2004). Merely "restraining" one's victim is not included in the definition of kidnapping. By dragging the victim around the store by her hair, locking the door, and forcing her to disrobe, Gray forcibly restrained the victim against her will. See, e.g., Davis v. State, 816 So. 2d 840 (Fla. 1st DCA 2002) (affirming conviction for false imprisonment based upon evidence that the victim was restrained on a sofa and told to "shut up" by a man holding a gun on her while other perpetrators robbed another person inside the house).
AFFIRMED IN PART, REVERSED IN PART, and REMANDED for resentencing.
ERVIN, WEBSTER, and HAWKES, JJ., CONCUR.
NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614101/ | 331 N.W.2d 822 (1983)
James D. JIMISON, Appellant,
v.
NORTH DAKOTA WORKMEN'S COMPENSATION BUREAU, Appellee.
Civ. No. 10268.
Supreme Court of North Dakota.
March 17, 1983.
Hartelius and Associates, Great Falls, Mont. and Mahoney & Mahoney, Center, for appellant; argued by Ann Mahoney, Center.
Joseph F. Larson, II, Asst. Atty. Gen., North Dakota Workmen's Compensation Bureau, Bismarck, for appellee; argued by Joseph F. Larson, II, Asst. Atty. Gen., Bismarck.
*823 ERICKSTAD, Chief Justice.
This is an appeal by James D. Jimison from a judgment of the District Court of McKenzie County dated May 10, 1982, affirming the North Dakota Workmen's Compensation Bureau's order dated July 21, 1980, which affirmed the Bureau's previous order denying Jimison further disability benefits. For the reasons hereinafter stated, we affirm.
On January 28, 1979, Jimison was injured in a work-related accident while employed by Circle T Drilling Company as a motorman on a drilling rig. Jimison described the accident and resultant injuries to his treating physician, Dr. Harper, in the following manner:
"Boiler was out on the rig. Rig floor was icy. Stepped off floor to pick up chain. Feet flew out from under, causing me to fall, injuring shoulder, neck, right arm. Fingers (2 small on right hand) have no feeling . . . . Constant headache since injury."
The Bureau accepted liability for Jimison's injuries and consequently paid him temporary total disability benefits[1] from January 29, 1979, through October 14, 1979. These facts are not questioned on appeal.
On November 14, 1979, the Bureau issued an order denying Jimison any further disability benefits. Upon Jimison's request, a rehearing was held with regard to this matter on May 20, 1980. Subsequent thereto, the Bureau issued an order, dated July 21, 1980, affirming its prior decision to terminate Jimison's benefits. In this order, the Bureau made the following findings of fact and conclusions of law:
"FINDINGS OF FACT
"I.
"That the claimant filed a claim for benefits with the North Dakota Workmen's Compensation Bureau on March 1, 1979, for an injury sustained by him on January 28, 1979.
"II.
"That on January 28, 1979, the claimant was employed by Circle T Drilling Company, Inc., of Denver, Colorado, as a motorman.
"III.
"That the claimant suffered injuries to his back, neck, and fingers on his right hand due to falling on ice on the rig floor while in the course of his employment on January 28, 1979.
"IV.
"That the Bureau accepted liability for the claim and paid benefits indicated above.
"V.
"That the claimant has been extensively evaluated, at the Bureau's expense, at the University Hospital of the University of Washington.
"VI.
"That the medical information obtained as the result of that evaluation indicated that the claimant's primary problem was of headaches which were felt to be tension-related; that the bilateral arm pain with right hand paresthesias would be aided by an excerise [exercise] program *824 in that the strength that the claimant has had in his arms and legs has decreased over the past year primarily due to disuse; and that the third problem was found to be of mild arachnoditis from previous surgery.
"VII.
"That the medical information supplied from the University Hospital also indicates that these findings were discussed with the claimant and his wife and that they were informed of recommendations made at the hospital.
"VIII.
"That the claimant and his wife denied any knowledge of the findings of recommendations made by the University Hospital.
"IX.
"That the claimant is capable of engaging in many employment related activities and has a substantial income from those activities.
"CONCLUSIONS OF LAW
"I.
"That the claimant has failed to prove that he remains disabled as a result of an employment injury on January 28, 1979.
"II.
"That the claimant has failed to prove that he is entitled to any further benefits under the Workmen's Compensation Act in connection with his condition."
Jimison appealed the Bureau's decision to the District Court of McKenzie County which affirmed the Bureau's order. Consequently, Jimison now appeals from the judgment of the district court. His contentions on appeal are twofold: first, that findings of fact numbers six and nine are not supported by a preponderance of the evidence; and, second, that the Bureau's conclusions of law are not sustained by its findings of fact.
When reviewing an appeal from an administrative agency decision, this court is guided by the standard of review set forth in Section 28-32-19, N.D.C.C., which reads in pertinent part:
"... the court shall affirm the decision of the agency unless it shall find that any of the following are present:
* * * * * *
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."
In accordance thereto, we must review the findings of fact, conclusions of law and order made by the Bureau rather than the findings by the district court. Davis v. North Dakota Workmen's Compensation Bureau, 317 N.W.2d 820, 822 (N.D.1982); Nelson v. North Dakota Workmen's Compensation Bureau, 316 N.W.2d 790, 793 (N.D.1982); Inglis v. North Dakota Workmen's Compensation Bureau, 312 N.W.2d 318, 321 (N.D.1981); Claim of Bromley, 304 N.W.2d 412, 414 (N.D.1981); Steele v. North Dakota Workmen's Compensation Bureau, 273 N.W.2d 692, 696 (N.D.1979). This review is limited and involves the three-step process of determining whether or not the findings of fact are supported by a preponderance of the evidence, whether or not the conclusions of law are sustained by the findings of fact, and whether or not the agency decision is supported by the conclusions of law. Davis, supra, 317 N.W.2d at 822; Nelson, supra, 316 N.W.2d at 793; Inglis, supra, 312 N.W.2d at 322; Claim of Bromley, supra, 304 N.W.2d at 415.
Hence, in the case at bar, our first step is to ascertain whether or not the disputed findings of fact are supported by a preponderance of the evidence. In Power Fuels, Inc. v. Elkin, 283 N.W.2d 214, 219 (N.D.1979), we defined preponderance of evidence as "evidence more worthy of belief," or "the greater weight of evidence," or "testimony that brings the greater conviction of truth." See, also, Gramling v. *825 North Dakota Workmen's Compensation Bureau, 303 N.W.2d 323, 328 (N.D.1981); Steele, supra, 273 N.W.2d at 697. We have further clarified the scope of review to be utilized under the "preponderance of evidence" standard by enunciating the following guideline:
"In construing the `preponderance of the evidence' standard to permit us to apply the weight-of-the-evidence test to the factual findings of an administrative agency, we do not make independent findings of fact or substitute our judgment for that of the agency. We determine only whether a reasoning mind reasonably could have determined that the factual conclusions reached were proved by the weight of the evidence from the entire record." Power Fuels, Inc., supra, 283 N.W.2d at 220.
Furthermore, when reviewing the evidence in a workmen's compensation case, this court will consider only the record which was before the Bureau, the transcript of the formal hearing, and any evidence presented at the hearing.[2] Section 28-32-19, N.D. C.C.; Gramling v. North Dakota Workmen's Compensation Bureau, 303 N.W.2d 323, 327 (N.D.1981).
Could a reasoning mind have determined, as did the Bureau, that the factual conclusions in the sixth finding of fact were proved by the weight of the evidence from the entire record? In order to adjudicate this question, we are required to evaluate the medical report issued by the University Hospital [Seattle Pain Clinic] of the University of Washington, Seattle, Washington, subsequent to its evaluation of Jimison for approximately two weeks in 1980. The Seattle Pain Clinic analyzed Jimison's case in the following manner:
"HOSPITAL COURSE:
"PROBLEM # 1Headache.
"These headaches were felt to be tension related .... It was felt that instruction in relaxation techniques would be beneficial in helping Mr. Jimison control his headaches.
"PROBLEM # 2Bilateral arm pain with right hand paresthesias.
"Evaluation of this symptomatology formed a primary basis of his evaluation during this hospitalization. . . .
". . . A multidisciplinary conference was held on the final day of the patient's admission and recommendations as a result of that conference included suggestion that an exercise program be undertaken to help Mr. Jimison keep up the obvious great strength that he has had in his arms and legs which has decreased over the past year, mainly because of disuse....
* * * * * *
"PROBLEM # 3Bilateral leg pain and sacral pain.
". . . No growth was found on culturing. This was felt to be consistent mild arachnoiditis from his previous surgery.[3] Because complaints of posterior thigh pain and sacral pain increased during his hospitalization, particularly during times when he was confined to bed as after his myelogram, the day of his discharge, an epidural injection through the sacral hiatus with 80 mg of Depo-Medrol was done to try to relieve any pain in his legs from the arachnoiditis."
The Bureau's conclusions in its sixth finding of fact concerning Jimison's bilateral arm pain and arachnoiditis are, in essence, verbatim statements from the Seattle Pain Clinic's report. Therefore, because we have found no conflicting evidence in the record with regard to these medical observations, *826 we conclude that the Bureau's findings relative to Jimison's bilateral arm pain and arachnoiditis are supported by a preponderance of the evidence.
In its sixth finding, the Bureau also determined that Jimison's "primary problem was of headaches." However, we have scrutinized the entire record and found no evidence to support this factual conclusion other than a heading in the Seattle Pain Clinic's report which states the following: "PROBLEM # 1headache". Because we do not believe that a simple numerical categorization should be construed to mean that Jimison's primary problem was that of headaches, we determine that a reasoning mind could have determined that the greater weight of the evidence indicated that Jimison suffered from headaches but not that his primary problem was of headaches.
In determining whether or not the "preponderance of evidence" standard was satisfied with regard to the Bureau's ninth finding of fact, we carefully scrutinized Jimison's entire file containing all the claims, correspondence, and medical records filed with the Bureau. See, Inglis, supra, 312 N.W.2d at 321; Gramling, supra, 303 N.W.2d at 327. Our examination revealed that information in a report furnished to the Bureau by Gary Stefonowicz of Equifax Services was of substantial import in resolving this issue. Stefonowicz investigated Jimison on the Bureau's behalf and, subsequent thereto, made the following observations:[4]
"I ... started a conservation [conversation] with Jim Pritkaus about what type of business the claimant was in. He told me that he owned a backhoe tractor and did excavation work on basements, water and sewer lines, and other general excavation work. He said that the claimant's son Jimmy Jimison works in the business with his father.... He said that they have only one backhoe, and the son usually operates that while the claimant usually does the bidding on the jobs, drives the pickup or truck to the site....
"Mrs. Hill ... said that he was a excavation contractor, and he had his son working in the business with. However she said that he drives the truck or pickup to job sites, handles the business end of it and does maintence [maintenance] work on the equipment in his shop at home.....
"I stopped at the home of this neighbor [A.D. Volbrecht], .... He added that the claimant normally does the bidding on jobs, supervision and maintence [maintenance] work on the excavation equipment....
"SELF EMPLOYED CLAIMANT: Prior to his disability he worked in the oil fields as a roughneck and operated his excavation business in his spare time. He would earn approximately $20-24,000 from his oil field job and net $15,000 from his excavation business. Since his disability his son has started in the business.... His son is known to operate the backhoe and he also does the heavy work. Claimant does mechanical work, bidding on job and supervision or work."
The testimony of Jimmy Jimison, the claimant's son, at Jimison's rehearing verifies the fact that since his injury Jimison has been involved in the excavating business in a supervisory capacity.
"Q What I was referring toif you need parts and you have to go to a parts dealership or whatever, he goes and picks them up?
"A Yeah.
"Q And biddinghe's indicated that he does most. Do you do any of the bidding?
"A Well, ... yes ...."
The record further reveals that in 1979 Jimison's gross income from his excavating business was approximately $35,000. Therefore, based upon our review of both the record and the transcript of Jimison's hearing, we conclude that the greater weight of the evidence supports the Bureau's *827 finding "that [Jimison] is capable of engaging in many employment related activities and has a substantial income from those activities."
Thus, with the exception of a minor phrase in the sixth finding of fact, the Bureau's sixth and ninth findings of fact are supported by a preponderance of the evidence. Hence, we must now address the question of whether or not the Bureau's findings of fact support its conclusions that Jimison is no longer disabled, and therefore not entitled to any further temporary total disability benefits pursuant to Section 65-05-09 of the North Dakota Century Code.
Basic to a determination of this issue are the legal principles defining the term "total disability". It is well established that "total disability" exists when a workman is unable, solely because of his job-related injury, to perform or obtain any substantial amount of labor in his particular line of work, or in any other for which he would be fitted. Lyson v. North Dakota Workmen's Compensation Bureau, 129 N.W.2d 351, 356 (N.D.1964). Where the Bureau has determined, as it did in this instance, that Jimison is capable of engaging in many employment-related activities such as repairing the machinery, bidding for prospective jobs, and supervising the excavating work, and where such finding is supported by a preponderance of the evidence, we conclude that Jimison is not "totally disabled".
Accordingly, we conclude that the Bureau's findings of fact sustain the agency's conclusions of law which in turn sustain its order delineating that Jimison is not disabled as a result of his employment-related injury on January 28, 1979, and thus at this time is not entitled to further temporary total disability benefits.[5]
In accordance with this opinion, the judgment of the district court is hereby affirmed.
VANDE WALLE, PEDERSON, SAND and PAULSON, JJ., concur.
NOTES
[1] The Bureau's order terminating Jimison's benefits does not specify as to the specific type of workmen's compensation benefits Jimison had been receiving. However, we believe the following correspondence between Richard J. Gross, counsel for the Workmen's Compensation Bureau, and Randall O. Skorheim, counsel for Jimison, indicates that the Bureau awarded Jimison benefits on the basis that he was "totally disabled":
"Dear Mr. Skorheim:
"We have your letter and your request for a rehearing....
"... they [the commissioners] would prefer that any further action on this claim await the reports from the Seattle Pain Clinic as to Mr. Jimison's condition. If the Pain Clinic evaluation indicates that Mr. Jimison remains totally disabled as the result of his employment injury, the Bureau will, at that time, reverse its order and reinstate benefits from the date [of] their termination."
[2] When adjudicating the issues presented for review, Jimison has urged us to consider Exhibits A and B which are attached to his brief. However, such evidence is not a part of the record and, accordingly, we have given it no consideration.
[3] The "previous surgery" referred to in the Seattle Pain Clinic's report is that of a laminectomy operation undergone by Jimison in 1966 for low back complaints. Jimison does not contend that he is entitled to disability benefits due to aggravation of a preexisting injury. Therefore, in adjudicating the issues raised on appeal, we have not considered the question of compensation for aggravation of a prior condition.
[4] No objection was made to a consideration of Mr. Stefonwicz's observations, but it was asserted that the son left other employment to aid his father and they could have earned more if the father could have continued to operate the backhoe.
[5] We make no determination today, nor could we do so on the state of the record, as to whether or not Jimison would be entitled to compensation for partial disability pursuant to Section 65-05-10, N.D.C.C., which reads:
"65-05-10. Partial disabilityWeekly Compensation. If the injury causes partial disability the fund shall pay to the disabled employee during such disability a weekly compensation to be fixed by the bureau." At a minimum, perhaps three factors should exist for an individual to be partially disabled. First, there should be a physical disability; second, the disability should be partial, or in other words, the employee should be able to work subject to the disability; and third, there should be an actual loss of earning capacity that is causally related to the disability. Dorn v. A.J. Chromy Const. Co., 310 Minn. 42, 47, 245 N.W.2d 451, 454 (1976). In Larson's treatise on workmen's compensation, it is stated that:
"... post-injury earnings and earning capacity are not synonymous. Earnings equal to preinjury earnings are the strongest evidence of nonimpairment of capacity, but they are not conclusive. In most jurisdictions their effect seems to be to create a presumption which may be overcome by other evidence showing that the actual earnings do not fairly reflect claimant's capacity." 2 Larson, Workmen's Compensation Law, § 57.31, p. XX-XXX-XX-XXX (1982). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614116/ | 939 So. 2d 842 (2006)
Marvin Sinatra SANDERS, Appellant
v.
STATE of Mississippi, Appellee.
No. 2005-KA-00068-COA.
Court of Appeals of Mississippi.
October 10, 2006.
*843 Johnnie E. Walls, Jr., Greenville, attorney for appellant.
Office of the Attorney General by Deirdre McCrory, attorney for appellee.
Before MYERS, P.J., BARNES, and ISHEE, JJ.
*844 MYERS, P.J., for the Court.
¶ 1. On August 19, 2004, Marvin Sinatra Sanders was found guilty of two counts of capital murder and one count of aggravated assault in the Circuit Court of Coahoma County. Sanders received a sentence of two terms of life imprisonment without the possibility of parole for the capital murder charges, and a twenty year sentence for the charge of aggravated assault, all to run consecutively.
¶ 2. Sanders then filed a motion for a judgment notwithstanding the jury verdict or, in the alternative, a new trial, which the trial court overruled on August 30, 2004. Thereafter, Sanders timely filed his motion for appeal and his notice of appeal in forma pauperis. The circuit court granted Sanders' motion and appointed Honorable Johnnie E. Walls, Jr., to continue the representation of Sanders in his appeal. Subsequently, Walls filed a brief summarizing the case's procedural and factual history, complete with citations to the record, certifying that after scouring the record thoroughly he found no arguable issues supporting Sanders' appeal in conformity with our supreme court's ruling in Lindsey v. State, 2003-KA-00331-SCT, 939 So. 2d 743, 2005 WL 613396 (Miss. Mar. 17, 2005). Additionally, Walls addressed several potential arguable issues that Sanders might have possibly raised on appeal as a pro se litigant, but correctly concluded that each issue was without merit and advised Sanders of his right to file a pro se brief.
¶ 3. Aggrieved, Sanders timely filed a brief on his own behalf and now appeals the following issues:
I. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY JUDICIAL MISCONDUCT.
II. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY PROSECUTORIAL MISCONDUCT.
III. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY THE INTRODUCTION OF INFLAMMATORY PHOTOGRAPHS.
IV. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY THE COURT ALLOWING AN IN-COURT IDENTIFICATION RESULTING FROM A PRIOR MISIDENTIFICATION.
V. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL DUE TO THE INEFFECTIVE ASSISTANCE OF COUNSEL.
¶ 4. Finding no reversible error, we affirm the judgment of the circuit court.
FACTS
¶ 5. In the late evening hours of October 3, 2003, Vester Mae Triplett was operating her small neighborhood grocery store located on Miles Road in the Roundway Community near Clarksdale, Mississippi, which was equipped with guest tables, game machines and a pool table. At that time, Triplett's brother's residence was located approximately one hundred yards from her store. On some occasions, including the night of October 3, 2003, Triplett catered to adults who shot pool, gambled and had a few drinks. On this evening, Triplett and several others, including Johnny Scott and Marvin Sanders were participating in a craps game.
¶ 6. Sanders, a long-time resident of the small community, arrived at Triplett's store at approximately 10:00 p.m. While at Triplett's store, Sanders drank beer and gin and was losing in the craps game. Sanders apparently ran out of money during the game and twice borrowed money from other players. Testimony at trial indicated that Sanders was upset about *845 losing and stated, "I'm gonna get my `F' money back, my mother `F' money back." Shortly before midnight Sanders left. Only Triplett and Scott remained in the store. At approximately midnight Triplett saw Sanders stop his car in the middle of the road in front of her store for a short time, then pull off. Shortly thereafter Triplett began preparing to close the store and depart. While Triplett and Scott were preparing to leave, Sanders returned to the store, fatally shot Scott in the back of the head, and demanded money from Triplett. At this point, Triplett saw through the window another person enter the parking lot of the store, exit his running vehicle, and proceed toward the front door of the store. After Triplett handed Sanders the money and pleaded for her life, Sanders shot Triplett in the face and she fell to the floor. As Triplett lay on the floor, Brandon Lott unknowingly walked into the store and was immediately shot and killed by Sanders, his body left lying in the doorway. After Sanders left, Triplett then pulled herself from the floor, found her keys, walked over the body of Lott to reach her van in the parking lot of the store. She then drove to her brother's nearby residence and blew the horn for attention. Triplett's brother called 911 and waited until the ambulance arrived. Triplett identified the shooter, both at that time and later in open court, as Marvin Sanders, whom she had attended high school with and had known for more than fifteen years.
LEGAL ANALYSIS
I. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY JUDICIAL MISCONDUCT.
II. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY PROSECUTORIAL MISCONDUCT.
¶ 7. These two issues are combined as they arise under the same standard of review and are governed by the same facts. Sanders cites several instances that he characterizes as judicial and prosecutorial misconduct. He argues that it was judicial misconduct on the part of the trial court to allow the prosecutor to ask leading questions and prosecutorial misconduct to ask the leading questions. Additionally, he argues that it was judicial misconduct for the court to allow the prosecutor to question a witness on redirect beyond the scope of the direct examination. Sanders further alleges error and misconduct by citing to several statements made by the prosecutor in his closing argument.
¶ 8. The decision to allow leading questions rests within the discretion of the trial court. Parks v. State, 930 So. 2d 383, 387(¶ 9) (Miss.2006). Only upon a finding of an abuse of discretion will a trial courts' ruling be disturbed. Id. We cannot say that under the context and circumstances of this case that the trial court abused its discretion in allowing the prosecutor to ask leading questions.
¶ 9. Pursuant to the Mississippi Supreme Court's recent adoption of a two-part test to determine whether a prosecutor's closing remarks constitute reversible error, we review first whether the remarks were improper, and if so, whether the remarks prejudicially affected the accused's rights. Spicer v. State, 921 So. 2d 292, 318(¶ 55) (Miss.2006) (adopting test annunciated by the Ohio Court of Appeals in State v. Grimes, 2005 Ohio 203, P18 (Ohio Ct.App.2005)). "It must be clear beyond a reasonable doubt, that absent the prosecutor's comments, the jury could have found the defendant guilty." Id. The standard used in reviewing closing arguments is "whether the natural and probable effect of the prosecuting attorney's improper argument created unjust prejudice against the accused resulting in a decision influenced by prejudice." Rushing v. State, 711 So. 2d 450, 455(¶ 15) (Miss.1998) (quoting *846 Taylor v. State, 672 So. 2d 1246, 1270 (Miss.1996)). The trial judge is in the best position to determine if an alleged objectionable remark has a prejudicial effect. Roundtree v. State, 568 So. 2d 1173, 1177 (Miss.1990). As we review the decision of the trial court regarding the admissibility of statements made in closing arguments, we keep in mind that counsel is allowed wide latitude when making their arguments to the jury; the trial court should show restraint in curtailing counsel's arguments. Any allegedly improper prosecutorial comments must be considered in the context and circumstances of the case.
¶ 10. After a thorough review of the record, this Court finds no merit in any of Sanders' claims of judicial or prosecutorial misconduct. There is nothing in the trial transcript to indicate that Sanders was prejudiced before the jurors by any judicial or prosecutorial misconduct during this phase of the trial. Therefore, neither judicial nor prosecutorial misconduct deprived Sanders of a fair trial as these issues are without merit.
III. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY THE INTRODUCTION OF INFLAMMATORY PHOTOGRAPHS.
¶ 11. "The standard of review regarding admission [or exclusion] of evidence is abuse of discretion. Where error involves the admission or exclusion of evidence, this Court will not reverse unless the error adversely affects a substantial right of a party.'" Whitten v. Cox, 799 So. 2d 1, 13(¶ 27) (Miss.2000) (citing Floyd v. City of Crystal Springs, 749 So. 2d 110, 113(¶ 12) (Miss.1999)).
¶ 12. Several photographs were introduced as exhibits into evidence at trial. At issue are four of the introduced photographs depicting the crime scene. Sanders argues that the introduction of the photographs was error because the exhibits were introduced for the sole purpose of evoking sympathetic emotions from the jury, and thus deprived him of a fair trial under the due process clause.
¶ 13. The law regarding admissibility of crime scene photographs is well-settled. The Mississippi Supreme Court has held,
Photographs have evidentiary value where they: 1) aid in describing the circumstances of the killing and the corpus delicti; Williams v. State, 354 So. 2d 266 (Miss.1978); 2) where they describe the location of the body and cause of death; Ashley v. State, 423 So. 2d 1311 (Miss.1982); and 3) where they supplement or clarify witness testimony. Hughes v. State, 401 So. 2d 1100 (Miss. 1981).
Westbrook v. State, 658 So. 2d 847, 849 (Miss.1995). All of the pictures introduced into evidence at trial that Sanders now appeals served to clarify the testimony of witnesses, to give the jury a visual depiction of the crime scene, and to show the cause of the victims' deaths. Three of the four contested photographs depict the physical position of the victims as they lay at the crime scene. These exhibits aid in the description of the crime scene and the circumstances surrounding the deaths. The fourth photograph introduced into evidence depicts the wound suffered by the victim, Scott. This photograph served to corroborate Triplett's testimony concerning Scott's manner of death. For the foregoing reasons, the trial court's admission of the photographs was not an abuse of discretion. Therefore, this issue is without merit.
IV. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL BY THE COURT ALLOWING AN IN-COURT IDENTIFICATION RESULTING FROM A PRIOR MISIDENTIFICATION.
¶ 14. Sanders next contends that the trial court erred in allowing the sole surviving *847 eyewitness of the shootings to testify regarding her pretrial identification and to make an in-court identification. The objections are based upon the credibility of Triplett in her identification of Sanders and upon the credibility of her testimony in general, due to alleged inconsistencies in her testimony. Sanders argues that this trial court error deprived him of a fair trial and thereby violated his due process rights.
¶ 15. In addressing Sanders' first objection to the in-court identification, the law concerning identification procedures is well-settled and must comply with the requirements of due process. Neil v. Biggers, 409 U.S. 188, 196, 93 S. Ct. 375, 34 L. Ed. 2d 401 (1972). The factors to be considered when determining whether an identification complies with due process are as follows:
(1) the opportunity of the witness to view the criminal at the time of the crime;
(2) the witness' degree of attention;
(3) the accuracy of the witness' prior description of the criminal;
(4) the level of certainty demonstrated by the witness at the confrontation; and
(5) the length of time between the crime and the confrontation.
Id. at 199-200, 93 S. Ct. 375; Ferguson v. State, 856 So. 2d 334, 338(¶ 10) (Miss.Ct. App.2003). These factors are to be considered under the totality of the circumstances. Biggers, 409 U.S. at 199, 93 S. Ct. 375. A review of the record establishes that each of the Biggers factors is satisfied.
¶ 16. Sanders claims that Triplett would not have had sufficient opportunity to view the assailant during Lott's murder because Triplett was lying on the floor. Sanders reasons that because Triplett was lying on the floor, her testimony concerning the shooter is faulty. However, the Mississippi Supreme Court has held that identifications are admissible when the witness viewed the criminal for only a few seconds. Horne v. State, 825 So. 2d 627, 638(¶ 41) (Miss.2002). Here, Triplett viewed Sanders during the entire robbery and addressed Sanders by name as she pleaded for her life. It was only at the point when she was shot that she fell backwards onto the floor. Based upon the facts, Triplett had ample opportunity to view the assailant during the commission of the crime, and Triplett's momentary loss of her line of sight of the appellant is not sufficient to bar Triplett's identification of Sanders as the shooter.
¶ 17. Further, the witness' degree of attention is not at issue in this case. Triplett was a victim of a robbery and aggravated assault and spoke face-to-face with the appellant as she plead for her life. Her testimony indicated that she recognized Sanders immediately upon his reentrance into the store and she acknowledged his presence. This testimony shows that she was paying sufficient attention during the commission of the crimes.
¶ 18. The accuracy and level of certainty demonstrated by Triplett in her prior description, which occurred almost immediately after the crime, is also not at issue. Once Triplett was able to drive to her brother's residence and gain his attention for help, she immediately and specifically identified Marvin Sanders, by name, as the assailant and never wavered from this initial identification. As the record reflects, Triplett had known Sanders for approximately fifteen years before the crime occurred. Triplett and Sanders attended the same high school, lived only a few hundred yards away from each other, and socially interacted on occasion, including the evening of the crime. All of these factors taken together demonstrate the accuracy *848 and level of certainty in Triplett's identification. Moreover, the elements of Biggers are supported by substantial evidence. Therefore, considering the totality of the circumstances of the out-of-court and in-court identifications, we find that there was sufficient evidence to support the trial court's admission of the identification evidence.
¶ 19. Sanders' second argument concerning the in-court identification is predicated upon the credibility of the witness and cites to alleged inconsistencies in Triplett's testimony. After a thorough review of the record, this Court is satisfied that there are no inconsistencies in Triplett's testimony. However, the jury is the true judge of witness credibility. The jury has the plenary discretion to believe or disbelieve any part of the testimony of any witness. Groseclose v. State, 440 So. 2d 297, 300 (Miss.1983). In this case, the jury chose to believe Triplett's testimony and consequently convicted Sanders. Therefore, the trial court did not err in allowing Triplett's out-of-court or in-court identification of Sanders.
V. WHETHER APPELLANT WAS DEPRIVED OF A FAIR TRIAL DUE TO THE INEFFECTIVE ASSISTANCE OF COUNSEL.
¶ 20. Sanders claims that his counsel's failure to interview a potential alibi witness, failure to have gun powder residue tests performed on Sanders' clothing, and failure to object to the prosecutor's use of a nickname for the appellant resulted in ineffective assistance of counsel, and thus violated his constitutional right to a fair trial.
¶ 21. Claims of ineffective assistance of counsel are reviewed by using the two-pronged test of Strickland v. Washington, 466 U.S. 668, 687, 104 S. Ct. 2052, 80 L. Ed. 2d 674 (1984). In order to prevail on a claim of ineffective assistance of counsel, Sanders has the burden of proof to show by a preponderance of the evidence that (1) counsel's performance was deficient, and (2) that the deficiency did, in fact, prejudice the defense's case so as to prevent a fair trial. Id.; Hall v. State, 735 So. 2d 1124, 1127(¶ 6) (Miss.Ct.App.1999). In determining whether the first prong of Strickland concerning counsel's performance has been satisfied, we must "indulge a strong presumption that counsel's conduct falls within the wide range of reasonable professional assistance. . . ." Strickland, 466 U.S. at 689, 104 S. Ct. 2052. The second prong of the Strickland test requires that Sanders prove prejudice by showing that there was a reasonable probability, but for counsel's errors, the trial court's result would have been different. Id. at 699, 104 S. Ct. 2052. Whether the prongs of this test are met is determined by an examination of the totality of the circumstances. Id.
¶ 22. In this instance, Sanders makes no valid argument of a deficiency in his lawyer's representation. Decisions to call witnesses, ask certain questions, or make particular objections fall within the purview of the attorney's trial strategy and "cannot give rise to an ineffective assistance of counsel claim." Carr v. State, 873 So. 2d 991, 1003(¶ 27) (Miss.2004). Although Sanders cites to numerous issues in support of his claim of ineffective assistance of counsel, he provides no evidence that he suffered harm as a result of his attorney's performance.
¶ 23. Sanders states that his lawyer refused to interview an alibi witness; however, he does not provide an identity of the witness, nor the substance of the potential testimony that would create his alibi. In fact, at trial the defense called three witnesses in an attempt to establish *849 Sanders' alibi. The jury chose not to believe those witnesses.
¶ 24. Sanders' argument regarding the failure of the gun residue testing also fails. This Court has previously held that the absence of a test for gun powder or nitrate "in no way renders the jury verdict invalid." Catchings v. State, 757 So. 2d 360, 363(¶ 11) (Miss.Ct.App.2000). Based on testimony provided at trial, a significant amount of time, possibly two hours, elapsed between the shootings and the subsequent arrest of Sanders. Thus a negative result of a gun powder test would not conclusively prove Sanders' innocence.
¶ 25. Lastly, upon this Court's review of the trial transcript, Sanders' argument concerning his attorney's failure to object to the prosecutor's use of a nickname for the appellant factually fails. An objection was properly made and subsequently overruled by the trial court. Furthermore, Sanders has shown no evidence that had his attorney interviewed the phantom alibi witness, or ordered a gun powder residue test, the outcome would have been different. Considering the totality of the circumstances, the performance of Sanders' trial counsel was not deficient, nor did it prejudice Sander's case in any way. Therefore, Sanders has failed to meet his burden of proof under the two-part test set out in Strickland, and his claim of ineffective assistance of counsel fails.
¶ 26. THE JUDGMENT OF THE CIRCUIT COURT OF COAHOMA COUNTY OF CONVICTION OF COUNT I CAPITAL MURDER AND SENTENCE OF LIFE IMPRISONMENT WITHOUT THE POSSIBILITY OF PAROLE; COUNT II CAPITAL MURDER AND SENTENCE OF LIFE IMPRISONMENT WITHOUT THE POSSIBILITY OF PAROLE; AND COUNT III AGGRAVATED ASSAULT AND SENTENCE OF TWENTY YEARS, TO RUN CONSECUTIVELY TO THE SENTENCES IN COUNTS I AND II, ALL IN THE CUSTODY OF THE MISSISSIPPI DEPARTMENT OF CORRECTIONS IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO COAHOMA COUNTY.
KING, C.J., LEE, P.J., SOUTHWICK, IRVING, CHANDLER, GRIFFIS, BARNES, ISHEE, AND ROBERTS, JJ., CONCUR. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614107/ | 416 Mich. 558 (1982)
331 N.W.2d 456
In re CERTIFIED QUESTIONS
KARL
v.
BRYANT AIR CONDITIONING COMPANY
Docket No. 68258, (Calendar No. 5).
Supreme Court of Michigan.
Argued June 8, 1982.
Decided December 23, 1982.
Ronald R. Stempien, P.C., for the plaintiff.
Law Offices of Gofrank & Kelman (by Sally Steinhart, Barry M. Kelman, and Philip G. Bozzo) for the defendants.
Amici Curiae:
Plunkett, Cooney, Rutt, Watters, Stanczyk & Pedersen (by Ernest R. Bazzana) for Association of *561 Defense Trial Counsel and Michigan Defense Trial Counsel.
Lopatin, Miller, Freedman, Bluestone, Erlich, Rosen & Bartnick (by Steven G. Silverman and Richard E. Shaw) for Michigan Trial Lawyers Association.
WILLIAMS, J.
INTRODUCTION
This is a case of first impression. The issues are whether the comparative negligence provisions of MCL 600.2949; MSA 27A.2949,[1] applies to a products liability action sounding in "negligence, breach of warranty and other misconduct"; and, if so, whether it is retrospective; and, if retrospective, whether it is constitutional.
This diversity case was removed from Oakland Circuit Court to the United States District Court for the Eastern District of Michigan. Plaintiff was injured when the terminal of an industrial air *562 conditioner manufactured by defendant, a foreign corporation, blew out. After a verdict for the plaintiff, the federal trial judge, under MCL 600.2949; MSA 27A.2949, reduced plaintiff's damages by the corresponding amount that plaintiff was negligent, which was 95% of the total.
Specifically, we have agreed to answer three questions certified to us by the United States Court of Appeals for the Sixth Circuit. The three questions are the following:
"I. Whether the Michigan products liability statute, MCL 600.2945 et seq.; MSA 27A.2945 et seq., is to be construed as abrogating the principle of Michigan implied warranty jurisprudence that a plaintiff injured by breach of an implied warranty is entitled to recover the full measure of damages sustained, irrespective of any negligence by the plaintiff.
"II. Whether the Michigan products liability statute, MCL 600.2945 et seq.; MSA 27A.2945 et seq., if so construed, is to be applied to an implied warranty action accruing and sued upon prior to the enactment of the statute and brought to trial after the effective date of the statute.
"III. Whether the Michigan products liability statute, MCL 600.2945 et seq.; MSA 27A.2945 et seq., if so construed and applied, violates the Due Process Clause (art 1, § 17) of the Michigan Constitution of 1963."
We hold first that under MCL 600.2949; MSA 27A.2949 a plaintiff injured by breach of an implied warranty is not entitled to recover the full damages sustained, if the plaintiff was negligent. Second, under Michigan law, the comparative negligence principle established in MCL 600.2949; MSA 27A.2949 can be applied to an implied warranty action accruing and sued upon prior to the enactment of the provision, but brought to trial *563 after the effective date of that provision. Third, applying the statute in that way does not violate the Due Process Clause of the Michigan Constitution. Const 1963, art 1, § 17.
FACTS
In certifying the instant case from the Court of Appeals for the Sixth Circuit under GCR 1963, 797.2, the following statement of facts was entered by order:
"On May 23, 1975, while employed in Southfield, Michigan, as an air conditioner repairman, plaintiff William Karl was injured when the terminal of an industrial air conditioner manufactured by defendants blew out. On February 28, 1978, plaintiff filed suit in Oakland Circuit Court, alleging negligence and breach of implied warranty. Thereafter, the action was removed by defendants to the United States District Court for the Eastern District of Michigan pursuant to 28 USC 1441. As a case falling within federal diversity jurisdiction, the substantive law which the trial judge was obliged to apply, and which this Court is required to apply, is the substantive law of the State of Michigan.
"While this case was pending in the trial court, the Michigan Legislature, on December 13, 1978, enacted the Michigan products liability statute, MCL 600.2945 et seq. [MSA 27A.2945 et seq.], effective immediately. Thereafter, this action came for trial before the Hon. Charles W. Joiner and a jury. At the conclusion of trial, the jury returned a special verdict finding, in pertinent part, that the total damages sustained were $52,000.00, that defendants breached an implied warranty, that plaintiff was negligent, and that plaintiff's negligence amounted to 95% of the total.
"Defendants then sought entry of judgment in the amount of $2,600 (5% of $52,000), while plaintiff sought entry of judgment in the amount of $52,000, the full measure of damages. Judge Joiner accepted the position *564 advocated by defendant. Plaintiff then appealed to this Court, presenting the above-described issues of Michigan law."
I. WHETHER THE MICHIGAN PRODUCTS LIABILITY STATUTE, MCL 600.2945 ET SEQ.; MSA 27A.2945 ET SEQ., IS TO BE CONSTRUED AS ABROGATING THE PRINCIPLE OF MICHIGAN IMPLIED WARRANTY JURISPRUDENCE THAT A PLAINTIFF INJURED BY BREACH OF AN IMPLIED WARRANTY IS ENTITLED TO RECOVER THE FULL MEASURE OF DAMAGES SUSTAINED, IRRESPECTIVE OF ANY NEGLIGENCE BY THE PLAINTIFF.
The United States Court of Appeals for the Sixth Circuit has requested that we consider whether the federal trial judge erred, as a matter of Michigan law, in reducing plaintiff's recovery by 95% under the comparative negligence principle adopted in MCL 600.2949; MSA 27A.2949. This requires us to determine whether the comparative negligence principle in that section was intended to apply to products liability actions sounding in implied warranty.[2]
*565 The plaintiff argues that both historically and presently products liability actions may sound either in negligence or breach of warranty without establishing privity with the defendant. See Spence v Three Rivers Builders & Masonry Supply, Inc, 353 Mich. 120, 134-135; 90 NW2d 873 (1958); Piercefield v Remington Arms Co, Inc, 375 Mich. 85, 98; 133 NW2d 129 (1965).[3] He then makes three points. First, "`concepts of negligence and fault, as defined by negligence standards, have no place in warranty recovery cases. Proof of negligence is unnecessary to liability for breach of implied warranty and the lack of it is immaterial to defense thereof'". Piercefield, supra, 96, quoting Picker X-Ray Corp v General Motors Corp, 185 A2d 919 (DC App, 1962).[4] Second, the Legislature did not repeal the implied warranty cause of action in enacting MCL 600.2949; MSA 27A.2949 and thereby create a "single theory of recovery" as found by Jorae v Clinton Crop Service, 465 F Supp 952 (ED Mich, 1979). In other words, he argues there is no warrant to diminish the verdict by the percentage of plaintiff's comparative negligence, because a breach of warranty action is extant and is a contractual, not a negligence, action. Among *566 other reasons advanced for this conclusion were (a), that since redress was sought for injury caused by "manufacture, construction, design", etc., the Legislature was not thinking of an implied warranty action, and (b), that the term "comparative fault" was rejected in favor of the term "comparative negligence".[5] Third, in MCL 600.2949; MSA 27A.2949, the Legislature intended to apply comparative negligence only to products liability negligence actions; and this also indicates that the Legislature was not thinking of implied warranty actions.
Defendant, on the other hand, has made two main arguments. First, referring to Jorae, supra, and to Justice LEVIN'S opinion, as a Court of Appeals judge, in Cova v Harley Davidson Motor Co, 26 Mich. App. 602, 614; 182 NW2d 800 (1970), the defendant suggests that the Legislature in 1978 PA 495 may have intended to create "one theory of `products liability'" and thereby eliminate the so-called contractual exemption from contributory negligence and comparative negligence. Second, defendant argued that the Legislature intended the comparative negligence provision to apply by its plain and specific language to "all" and "any" products liability actions.
*567 Our reading of the statute does not require us to determine whether the Legislature completed the possible confluence of products liability negligence and implied warranty actions into one cause of action or whether two separate actions still remain extant. We hold that the combination of § 2949, the products liability comparative negligence section, and § 2945, the section defining products liability actions, by plain, unambiguous language, indicates that the Legislature intended to apply comparative negligence to all products liability actions, regardless of whether two separate actions in negligence and breach of warranty remain extant or whether a new unified products liability action was created by the act.
Before examining the actual language of the statute, it is well to have in mind certain rules of statutory construction. The most important rule, of course, is to discover and give effect to the legislative intent. Spartan Asphalt Paving Co v Grand Ledge Mobile Home Park, 400 Mich. 184, 187; 253 NW2d 646 (1977); Dussia v Monroe County Employees Retirement System, 386 Mich. 244, 248; 191 NW2d 307 (1971).
The next rule is to derive the legislative intention from the actual language used in the statute. Grand Rapids v Crocker, 219 Mich. 178, 182-183; 189 N.W. 221 (1922). If the language used is clear and the meaning of the words chosen is unambiguous, a common-sense reading of the provision will suffice, and no interpretation is necessary. Dussia v Monroe County Employees Retirement System, supra, p 248; MacQueen v City Comm of Port Huron, 194 Mich. 328, 342; 160 N.W. 627 (1916).
We believe that the language of § 2949, particularly *568 in conjunction with § 2945, is clear and unambiguous. Sections 2949 and 2945 are here set out for review:
"Sec. 2949. (1) In all products liability actions brought to recover damages resulting from death or injury to person or property, the fact that the plaintiff may have been guilty of contributory negligence shall not bar a recovery by the plaintiff or the plaintiff's legal representatives, but damages sustained by the plaintiff shall be diminished in proportion to the amount of negligence attributed to the plaintiff." (Emphasis added.)
"Sec. 2945. As used in sections 2946 to 2949 and section 5805, `products liability action' means an action based on any legal or equitable theory of liability brought for or on account of death or injury to person or property caused by or resulting from the manufacture, construction, design, formula, development of standards, preparation, processing, assembly, inspection, testing, listing, certifying, warning, instructing, marketing, advertising, packaging, or labeling of a product or a component of a product." (Emphasis added.)
In § 2949, the operative language is "all products liability actions". This language is defined in § 2945 as follows: "`products liability action' means an action based on any legal or equitable theory of liability". It is difficult to imagine any language more all-inclusive.
As a consequence, it is clear and unambiguous that the Legislature intended that comparative negligence should apply to "all products liability actions", which include a "`products liability action' * * * based on any legal or equitable theory of liability".[6] It is inescapable that any and every *569 products liability action is included regardless of whether it is labeled a possible unified action, a possible negligence action, or a possible implied warranty action.
We believe that the Legislature's use of the words "all" and "any" require, without further interpretative inquiry, the construction that comparative negligence applies to all and any products liability actions, including those sounding in implied warranty. See Paquin v Harnischfeger Corp, 113 Mich. App. 43, 50; 317 NW2d 279 (1982); McGrath v Clark, 89 Mich. App. 194, 197; 280 NW2d 480 (1979). As a consequence, we are not persuaded by plaintiff's arguments that the Legislature intended § 2949 to apply only to negligence actions. The plain, unambiguous language of the statute is such that we need not speculate on its legislative history. Furthermore, we are not impressed by the plaintiff's argument that an implied warranty products liability action is not included in the long litany found in § 2945 which describes the act's effect on the various stages a product may go through before it causes injury to a plaintiff.
Thus, we hold that the comparative negligence principle adopted in MCL 600.2949; MSA 27A.2949 dictates that "damages sustained by the plaintiff shall be diminished in proportion to the amount of negligence attributed to the plaintiff" irrespective of the fact that a plaintiff is injured by the breach of an implied warranty.[7]
*570 II. WHETHER THE MICHIGAN PRODUCTS LIABILITY STATUTE, MCL 600.2945 ET SEQ.; MSA 27A.2945 ET SEQ., IF SO CONSTRUED, IS TO BE APPLIED TO AN IMPLIED WARRANTY ACTION ACCRUING AND SUED UPON PRIOR TO THE ENACTMENT OF THE STATUTE AND BROUGHT TO TRIAL AFTER THE EFFECTIVE DATE OF THE STATUTE.
A. The Four Rules of Retrospectivity
In answering Question I, we have held that the products liability statute, in light of § 2949, establishes the principle of comparative negligence in an action based on implied warranty. In considering Question II, we address whether § 2949 applies where the statute was enacted subsequent to the injury and commencement of an implied warranty action, but prior to the trial and judgment in that action. We hold that § 2949 should be applied under such circumstances.
In answering this question, we must consider four rules in determining whether a new act applies to a pre-enactment cause of action. First, is there specific language in the new act which states that it should be given retrospective or prospective application. See headnote no. 1, Hansen-Snyder Co v General Motors Corp, 371 Mich. 480; 124 NW2d 286 (1963). Second, "[a] statute is not regarded as operating retrospectively [solely] because it relates *571 to an antecedent event". Hughes v Judges' Retirement Board, 407 Mich. 75, 86; 282 NW2d 160 (1979). Third, "[a] retrospective law is one which takes away or impairs vested rights acquired under existing laws, or creates a new obligation and imposes a new duty, or attaches a new disability with respect to transactions or considerations already past". Hughes, supra, p 85; Ballog v Knight Newspapers, Inc, 381 Mich. 527, 533-534; 164 NW2d 19 (1969). Fourth, a remedial or procedural act which does not destroy a vested right will be given effect where the injury or claim is antecedent to the enactment of the statute. Rookledge v Garwood, 340 Mich. 444; 65 NW2d 785 (1954).
B
The first and second rules are inapplicable to the instant case. As to the first rule, the products liability statute contains no specific language indicating either retrospective or prospective application. Second rule cases relate to measuring the amount of entitlement provided by a subsequent statute in part by services rendered pursuant to a prior statute, whereas the instant case relates to what if any changes may be made with respect to a cause of action begun under one rule of law by a subsequent statute. Examples of second rule cases are measuring the amount of a judicial pension not only by years served subsequent to enactment but also by years served under a previous act, Hughes, supra, and measuring the amount of highway entitlement not only by expenditures subsequent to enactment but also by expenditures under a previous act. Clearwater Twp v Kalkaska County Supervisors, 187 Mich. 516; 153 N.W. 824 (1915).
*572 C
Rules three and four define the issue in Question II. Both rules relate to retrospective application of a new law to prior facts. The third rule and the cases thereunder define those retrospective situations that are not legally acceptable, whereas the fourth rule defines those that are acceptable.
The third rule states that retrospective application of a law is improper where the law "takes away or impairs vested rights acquired under existing laws, or creates a new obligation and imposes a new duty, or attaches a new disability with respect to transactions or considerations already past". Hughes, supra, p 85. The fourth rule was stated in Hansen-Snyder, supra (headnote no. 1):
"1. STATUTES REMEDIES RETROSPECTIVE OPERATION AMENDMENT. Statutes related to remedies or modes of procedure which do not create new or take away vested rights, but only operate in furtherance of a remedy or confirmation of rights already existing will, in the absence of language clearly showing a contrary intention, be held to operate retrospectively and apply to all actions accrued, pending or future, there being no vested right to keep a statutory procedural law unchanged and free from amendment."
We will examine the general statement of each rule and the specific factors in the cases relating to that rule. When we have done this, we will then compare the facts in the instant case with those rules and factors to determine which rule should cover the instant case.
D. Rule Three Cases
1. Impairment of Contractual Rights
In marshaling his arguments under this certified *573 question, the plaintiff relies on two lines of cases which have a distinct cleavage, even though the Court in both lines of cases has invoked the general proscription found in rule three. Under the first line of cases, the plaintiff asserts that a retrospective application of the products liability statute interferes with his "contractual cause of action" since "implied warranty litigation is essentially contractual in nature". E.g., Campbell v Judges' Retirement Board, 378 Mich. 169; 143 NW2d 755 (1966); Byjelich v John Hancock Mutual Life Ins Co, 324 Mich. 54; 36 NW2d 212 (1949); McGavock v Ducharme, 192 Mich. 98; 158 N.W. 173 (1916).
A review of these cases, however, does not support plaintiff's position, since the contracts in those cases did not involve implied warranties but were "express" contracts.
2. Abolition of a Cause of Action
The general rule against retrospective application has been applied in cases where a new statute abolishes an existing cause of action. It is clear that once a cause of action accrues, i.e., all the facts become operative and are known it becomes a "vested right". See Connelly v Paul Ruddy's Equipment Repair & Service Co, 388 Mich. 146, 150-152; 200 NW2d 70 (1972); Devlin v Morse, 254 Mich. 113, 115; 235 N.W. 812 (1931). A new statute which abolishes an existing cause of action brings the statute within the general proscription of rule three.
In Devlin, for example, this Court held that the guest passenger act should not have been applied to a plaintiff's claim which accrued prior to the new act. When the plaintiff passenger was injured, the common law recognized his right to sue the driver of the car for ordinary negligence. The new *574 act, however, only allowed suit when a driver was grossly negligent. This Court refused to apply the new act to the plaintiff's common-law claim, which was sued upon after the new act became effective, but where the injury had occurred before its enactment, because the new law abolished the plaintiff's accrued cause of action. Devlin, supra, p 116.
Similarly, in Cusick v Feldpausch, 259 Mich. 349, 353; 243 N.W. 226 (1932), the plaintiff passenger was held to have a statutory claim to sue the owner of a car for the ordinary negligence of the driver. The amendment of that statute, which was adopted after plaintiff's action had accrued, only allowed the plaintiff to sue the owner where the driver was grossly negligent. Because plaintiff's cause of action would have been totally barred by a retrospective application, we stated that this case did not involve a "mere change in remedy or procedure", but affected a rule of substantive law.
Finally, in Minty v Board of State Auditors, 336 Mich. 370; 58 NW2d 106 (1953), the plaintiff sustained personal injuries at a time when the state waived sovereign immunity from liability for the injuries caused by the tortious conduct of its employees. Before the plaintiff's cause of action had been reduced to judgment in the Court of Claims, the act was repealed. The state argued that it could raise the total bar of governmental immunity. Once again, this Court refused to apply a statute retrospectively because it totally barred the plaintiff from recovery for his damages.
The converse factual setting to the cases discussed is found in Rookledge, supra. At the time of the plaintiff's work-related accident, he had to elect between workers' compensation benefits from his employer and bringing an action against a third-party tortfeasor. The plaintiff elected to receive *575 compensation benefits, thereby barring his third-party claim. After he received his compensation benefits, the workers' compensation act was amended to permit the worker both options. He brought suit against the third-party tortfeasors, and this Court held that the defendant did not have a "vested right" in the statutory defense dependent upon the plaintiff's election accorded him prior to the new act. 340 Mich. 457.
E. Rule Four Cases
The case law development of rule four establishes the corollary to the general proscription found in rule three. A remedial or procedural statute may operate retrospectively if it does not "take away vested rights". Ballog v Knight Newspapers, Inc, supra, pp 533-534, quoting from headnote no. 1 of Hansen-Snyder Co v General Motors Corp, 371 Mich. 480 (1963).
Moreover, in Guardian Depositors Corp v Brown, 290 Mich. 433, 439-440; 287 N.W. 798 (1939), this Court, in a "contract case", stated that the Legislature may modify, limit, and even alter the remedy for enforcement of a contract without violating the rule against retrospectivity. Thus, such a new act would fall into rule four because it does not completely deny a remedy with such restrictions that it impairs the value of the contract or the substantive right.
Although Rookledge, supra, was considered in our discussion of rule three, its holding supports our analysis of rule four. While the Rookledge Court found that the defendant third-party tortfeasor did not have a vested right in a statutory defense which barred the plaintiff from suit once he elected workers' compensation benefits, that Court implicitly recognized, consistent with rule four, that the fact that the new statute changes *576 the legal consequences of a prior act does not prevent a retrospective application of that statute, since that statute is remedial in nature.
In Hansen-Snyder, supra, this Court held that a plaintiff could take advantage of a statutory amendment which extended the period for serving notice of intent to claim a lien from 60 days to 90 days from the date of first furnishing labor and material. The plaintiff, who had begun work under the prior statute, had failed to file within the old act's 60-day prescription. Nevertheless, the new act was viewed as a procedural amendment which was applicable to the plaintiff's claim.
Once again, in Ballog, supra, this Court, in a case procedurally similar to the instant case, applied a new act retrospectively. The Court in Ballog had to determine whether a statute in effect at the time of the plaintiff's injury which granted interest "from the date of judgment" or a new act which granted interest "from the date of filing the complaint" was applicable. The plaintiff's personal injury cause of action accrued before the new act became effective, and he also filed suit before its enactment. Nevertheless, we indicated that the new act fell within the remedial or procedural classification which did not take away a vested right, and, thus, we gave the new act retrospective effect. 381 Mich 533-536.
F. Comparing the Instant Case to Rule Three and Four Cases
In comparing the instant case to rule three and rule four cases discussed, it is immediately apparent that the federal trial judge did not err under Michigan law in applying the products liability statute in the case at bar where plaintiff's claim accrued and was sued upon prior to the time the new statute became effective. On the one hand, it *577 is conceded that plaintiff's right became "vested" when his cause of action accrued. But, on the other hand, two things are clear. First, § 2949 is part of a remedial statute which may be applied retrospectively. Second, the relevant case law indicates to us, when we compare it to the case at bar, that plaintiff's right was not taken away in the technical meaning of the case law proscription.
1. Rule Three Cases
Comparison of "rule three cases" to the instant case indicates that application of the products liability statute did not trigger the proscription found in rule three. First, the statute did not interfere with plaintiff's "contractual cause of action" since an implied warranty action for personal injuries caused by a defective product is different from an express contract. Second, this rule is also triggered when a plaintiff's accrued cause of action would be totally barred or taken away by a new act. While the total damages which plaintiff could have received were significantly reduced by § 2949, plaintiff's cause of action was not legally barred or taken away.
Section 2949 does not bar any claim, legal or equitable, but it states that "damages sustained by the plaintiff shall be diminished in proportion to the amount of negligence attributed to the plaintiff". See, also, Li v Yellow Cab Co of California, 13 Cal 3d 804, 828-829; 119 Cal Rptr 858, 875; 532 P2d 1226, 1243 (1975). Section 2949 is not a legal bar, but is a principle established by the Legislature which mitigates damages in products liability actions.
In short, we hold that the applicability of the products liability statute in the instant case did not offend Michigan's general rule against the retrospective application of a statute which *578 "take[s] away vested rights". Ballog, supra, pp 533-534.
2. Rule Four Cases
Notwithstanding the general proscription of rule three, this Court has recognized that new remedial or procedural statutes which do not destroy vested rights should be given retrospective application. The plaintiff does not contend that his cause of action was destroyed by the application of § 2949. Thus, the key factor is to determine whether the new act concerns remedies or modes of procedure.
The tenor of the products liability statute and the legislative history referred to in the briefs indicate that the Legislature was responding to complaints about the cost of products liability insurance and the operation of products liability law prior to its enactment. See Products Liability Task Force, 58 Mich Bar J 524, 525 (1979). See, also, Jorae v Clinton Crop Service, 465 F Supp 952 (ED Mich, 1979). Since the Legislature has adopted comparative negligence as a principle which reduces plaintiff's damages in proportion to the amount of his negligence, such legislation operates to improve and further a remedy. As Rookledge, Hansen-Snyder, and Ballog make explicitly clear, legislation with such a purpose is remedial in nature.
Thus, rule four supports our holding that the federal trial judge did not err, as a matter of Michigan law, in applying the comparative negligence principle adopted in § 2949 to an implied warranty action for personal injuries caused by a defective product which had accrued and was sued upon prior to the enactment of the products liability statute and was brought to trial after the effective date of that statute.
*579 III. WHETHER THE MICHIGAN PRODUCTS LIABILITY STATUTE, IF SO CONSTRUED AND APPLIED, VIOLATES THE DUE PROCESS CLAUSE (ART 1, § 17) OF THE MICHIGAN CONSTITUTION.
The plaintiff asserts that if this Court holds that the Legislature intended the act to be given retroactive effect, such an interpretation violates the Due Process Clause of the Michigan Constitution.[8] He argues that once his claim accrues, it becomes a vested property right subject to due process protection. The plaintiff contends that his cause of action accrued and vested on May 23, 1978, and that any impairment of this "vested property right in an implied warranty action must be measured against due process guarantees".
The nature of plaintiff's argument is the undoing of his constitutional claim. An application of the comparative negligence provision at trial, besides promoting important societal policy, did not destroy or bar plaintiff's cause of action. This Court is reluctant, on constitutional grounds, to apply statutes which accomplish this evil. See Minty v State, supra, pp 389-391. As the defendant so adroitly points out, the products liability statute neither destroys nor bars plaintiff's cause of action, nor does it impair plaintiff's right to contract. Simply stated, the statute only affects a remedy which "has been changed so that the measure of plaintiff's damages is to be reduced by the amount of the plaintiff's own fault which also proximately *580 caused the injuries complained of". Thus, the Legislature's adoption of such a remedial scheme is reasonable and does not violate the Due Process Clause of the Michigan Constitution.
CONCLUSION
Our review of MCL 600.2949; MSA 27A.2949 and the relevant case law indicates that the Legislature intended comparative negligence to apply in an action for breach of implied warranty. Moreover, our interpretation of Michigan law leads us to hold that MCL 600.2949; MSA 27A.2949 can be applied in a case where the implied warranty action accrues and is sued upon prior to the enactment of the provision and is brought to trial after the effective date of that provision. Finally, such an application does not violate the Due Process Clause of the Michigan Constitution. Const 1963, art 1, § 17.
FITZGERALD, C.J., and KAVANAGH, LEVIN, COLEMAN, and RYAN, JJ., concurred with WILLIAMS, J.
RILEY, J., took no part in the decision of this case.
NOTES
[1] MCL 600.2949; MSA 27A.2949 provides that:
"(1) In all products liability actions brought to recover damages resulting from death or injury to person or property, the fact that the plaintiff may have been guilty of contributory negligence shall not bar a recovery by the plaintiff or the plaintiff's legal representatives, but damages sustained by the plaintiff shall be diminished in proportion to the amount of negligence attributed to the plaintiff.
"(2) If the court determines that the claim or defense is frivolous, the court may award costs and reasonable attorney's fees to the prevailing party in a products liability action. Moreover, MCL 600.2945; MSA 27A.2945 provides that:
"As used in sections 2946 to 2949 and section 5805, `products liability action' means an action based on any legal or equitable theory of liability brought for or on account of death or injury to person or property caused by or resulting from the manufacture, construction, design, formula, development of standards, preparation, processing, assembly, inspection, testing, listing, certifying, warning, instructing, marketing, advertising, packaging, or labeling of a product or a component of a product."
[2] During oral arguments, Justice RYAN addressed the following question to defense counsel: "whether it is within the competence of the Legislature to make a law concerning what is and what is not admissible evidence". He further asked whether counsel was familiar with Perin v Peuler, 373 Mich. 531; 130 NW2d 4 (1964). Defense counsel's answer and a review of the briefs clearly indicates that the parties in the instant case were unfamiliar with Perin. Moreover, this issue was not considered by the trial court.
The certified questions in the instant case do not raise the propriety of applying the statutory rules of evidence found in the products liability statute. See MCL 600.2946; MSA 27A.2946, MCL 600.2947; MSA 27A.2947, MCL 600.2948; MSA 27A.2948.
Since the issue has not been raised or briefed and its consideration is not necessary in answering the certified questions, the general rule of law is that this Court will not consider such an extraneous issue. See Turner v Consumers Power Co, 376 Mich. 188, 191-192; 136 NW2d 1 (1965). See, also, Heider v Michigan Sugar Co, 375 Mich. 490, 517; 134 NW2d 637 (1965) (ADAMS, J., dissenting). See, also, Swartz v Dow Chemical Co, 414 Mich. 433; 326 NW2d 804 (1982).
[3] See Comment, Products Liability in Michigan: Implied Warranty, Strict Tort, or Both, 15 Wayne L Rev 1558 (1969). See, also, Dolan, Commercial Transactions, 1980 Annual Survey of Michigan Law, 27 Wayne L Rev 589, 605 (1981).
[4] In Smith v E R Squibb & Sons, Inc, 405 Mich. 79, 91; 273 NW2d 476 (1979), this Court stated that:
"This opinion is limited solely to its facts. We do not suggest that implied warranty and negligence are not independent causes of action. When the factual issue is the adequacy of the warnings given, the legal standard under either theory is one of reasonable care under the circumstances. Note should be made, however, that on different facts it could be prejudicial error not to give the implied warranty instruction. See, e.g., Midgley v S S Kresge Co, 55 Cal App 3d 67; 127 Cal Rptr 217 (1976) (issue of contributory negligence requires instruction on both negligence and strict liability)."
[5] On May 15, 1978, the second draft of House Bill 5689, which preceded MCL 600.2949; MSA 27A.2949, was introduced. This provision stated:
"Sec. 2949. (1) IT SHALL BE A REBUTTABLE DEFENSE IN A PRODUCTS LIABILITY ACTION THAT THE PLAINTIFF WAS COMPARATIVELY NEGLIGENT OR AT FAULT. THE COURT OR A JURY IN DETERMINING LIABILITY OR THE AMOUNT OF DAMAGES IF THIS DEFENSE IS ALLEGED SHALL WEIGH THE COMPARATIVE NEGLIGENCE OR FAULT OF EACH PARTY AND ASSESS A PORTION OF THE LIABILITY OR DAMAGES BASED ON THE COMPARATIVE NEGLIGENCE OR FAULT OF EACH PARTY."
See, also, 12 ULA, Civil Procedural & Remedial Laws, Uniform Comparative Fault Act, § 1b, p 34 (1982 Cum Supp); Products Liability Task Force, 58 Mich Bar J 524, 525 (1979).
[6] See, generally, Note, Timmerman v Universal Corrugated Box Machinery Corp An Exception to the Doctrine of Comparative Negligence in Products Liability Litigation: Michigan Courts Speak out on Public Act 495, 1981 Det C L Rev 222, 235. See, also Comment, Public Act 495 A Beginning Step in Products Liability Reform in Michigan, 1979 Det C L Rev 677, 688 ff.
[7] In Hardy v Monsanto Enviro-Chem Systems, Inc, 414 Mich. 29, 47, fn 12; 323 NW2d 270 (1982), this Court, in effect, refused to address some of the questions in the instant case. We stated that:
"We decline to speculate about the effect of Placek and the products liability statute, MCL 600.2945; MSA 27A.2945, on the law of products liability. This case, as well as Tulkku and Funk, are negligence cases. The cases cited in our brother's opinion for the proposition that comparative negligence should not apply are inapplicable. Zerby v Warren, 297 Minn 134, 141; 210 NW2d 58 (1973), held that no comparative negligence defense was available under a statute imposing strict liability for selling model airplane glue to a minor; Suter v San Angelo Foundry & Machine Co, 81 NJ 150; 406 A2d 140 (1979), was a strict liability case holding that comparative negligence was unavailable under those facts but noting that comparative negligence is a defense in some strict liability cases. See Ettin v Ava Truck Leasing, Inc, 53 NJ 463; 251 A2d 278 (1969); Cintrone v Hertz Truck Leasing & Rental Service, 45 NJ 434; 212 A2d 769 (1965)."
[8] Const 1963, art 1, § 17, states that:
"No person shall be compelled in any criminal case to be a witness against himself, nor be deprived of life, liberty or property, without due process of law. The right of all individuals, firms, corporations and voluntary associations to fair and just treatment in the course of legislative and executive investigations and hearings shall not be infringed." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1618742/ | 303 S.W.3d 108 (2010)
KENTUCKY BAR ASSOCIATION, Movant,
v.
Eric Lamar EMERSON, Respondent.
No. 2009-SC-000508-KB.
Supreme Court of Kentucky.
January 21, 2010.
As Modified March 5, 2010.
OPINION AND ORDER
Respondent, Eric Lamar Emerson, whose last known bar roster address is Gateway Center West, 300 Madison Avenue, Suite 300, Covington, Kentucky 41011 and whose KBA Member No. is 89553, was admitted to the practice of law in the Commonwealth of Kentucky in 2002. The Kentucky Bar Association has petitioned this Court to impose reciprocal discipline against Respondent because he has been disciplined in Ohio.
Respondent was previously publicly reprimanded in this state, Kentucky Bar Ass'n v. Emerson, 260 S.W.3d 782 (Ky. 2008), and then suspended from the practice of law in this state, Kentucky Bar Ass'n v. Emerson, 275 S.W.3d 183 (Ky. 2008) (61-day suspension); Kentucky Bar Ass'n v. Emerson, 276 S.W.3d 823 (Ky. 2009) (181-day suspension). Respondent received reciprocal discipline in Ohio for each of these cases. See Disciplinary Counsel v. Emerson, 120 Ohio St. 3d 1206, 897 N.E.2d 647 (2008); Disciplinary Counsel v. Emerson, 121 Ohio St. 3d 1229, 903 N.E.2d 647 (2009); Disciplinary Counsel v. Emerson, 121 Ohio St. 3d 1226, 903 N.E.2d 644 (2009).
Since those cases were decided, Respondent has been subject to further discipline for other misconduct in Ohio. On June 25, 2009, the Ohio Supreme Court found that Respondent had committed multiple instances of misconduct, which it described as follows:
Respondent agreed in August 2005 to pursue a civil rights action on behalf of a client, who then advanced $1,200 for costs in her case. After filing an amended complaint in federal district court, respondent failed to respond to requests for discovery and did not appear as scheduled at two depositions. The district court ordered respondent in October 2006 to file a notice of withdrawal *109 immediately or continue as counsel. Respondent did not withdraw but continued in failing to assist the client.
Respondent conceded that he had abandoned his client, leaving her to file motions on her own to preserve her claim. He also conceded his failure to promptly honor requests for the client's file and an itemized billing for his services. After the client filed a grievance with relator, respondent failed to reply to letters of inquiry even after promising during his deposition to respond in writing.
. . .
In December 2005, another client paid respondent $2,500 for his representation, along with another attorney, in a property dispute with the client's ex-husband. During litigation in the matter, the court ordered the client to convey certain property rights to her ex-husband as part of the divorce decree. The client refused to sign the necessary papers and discharged respondent, afterward reclaiming her file and demanding a refund.
Respondent believed that he had earned the entire $2,500 with the services he had provided. But he admittedly did not comply with the client's request for an itemized billing, explaining that he had not documented the hours spent on her case and had given her everything from which he might have reconstructed the time. After the client filed a grievance with relator, respondent further failed to respond to an investigator's letters, even after promising at his deposition to respond in writing.
. . .
A third client hired respondent in March 2006 after the client sustained injuries in a traffic accident. Respondent accepted the case but then failed to obtain his client's file from a previous lawyer and did not review court records of the proceedings that had already occurred. When respondent also failed to appear in the case on his client's behalf, the court dismissed the action for want of prosecution. Respondent failed to communicate with his client and did not return the case file upon request. He also failed to reply to investigative letters relative to a grievance about his representation.
. . .
Before the Supreme Court of Kentucky suspended respondent from practice of law in that state, the court publicly reprimanded him for misconduct committed when he represented an Ohio resident in Kentucky during July 2006. Respondent had accepted a $2,500 fee from that client and his family, later withdrew as counsel without returning any portion of the fee, and then failed to respond to the disciplinary charges brought against him.
During preliminary inquiries about the Kentucky case, respondent failed to respond to various letters and forced relator to subpoena him for deposition. He then failed to present a written response that during his deposition he had promised to provide.
Cincinnati Bar Ass'n v. Emerson, 122 Ohio St. 3d 176, 909 N.E.2d 635, 637-38 (2009) (citations and paragraph marks omitted). The court summarized Respondent's misconduct as "repeatedly neglect[ing][his] clients' legal interests and fail[ing] to cooperate in the ensuing disciplinary investigation." Id. at 638. As a result of the misconduct, Respondent was indefinitely suspended from the practice of law in Ohio and barred from applying for reinstatement for two years. Id.
In August 2009, the KBA moved this Court to issue an order requiring Respondent *110 to show cause why identical reciprocal discipline should not be imposed under SCR 3.435. A show cause order was issued on October 1, 2009. Respondent failed to file a response, so the issue of what, if any, discipline to impose is now ripe for review by this Court.
Under Kentucky Supreme Court Rule 3.435, Respondent shall be subject to identical discipline in the Commonwealth of Kentucky unless he proves by substantial evidence: (a) a lack of jurisdiction or fraud in the out-of-state disciplinary proceeding, or (b) that the misconduct established warrants substantially different discipline in this State. SCR 3.435(4). The Ohio Supreme Court's order, as a "final adjudication in another jurisdiction that an attorney has been guilty of misconduct[,] shall establish conclusively the misconduct for purposes of a disciplinary proceeding in this State." SCR 3.435(4)(c).
Seeing no reason why Respondent should not be subjected to identical discipline in this state SCR 3.435, it is hereby ORDERED that:
1. The Kentucky Bar Association's petition for reciprocal discipline is GRANTED. Respondent, Eric Lamar Emerson, is suspended indefinitely from the practice of law in the Commonwealth of Kentucky and shall not seek reinstatement for two years.
2. In accordance with SCR 3.450, Respondent is directed to pay any costs associated with these disciplinary proceedings against him, should there be any, and execution for such costs may issue from this Court upon finality of this Opinion and Order.
3. Should Respondent currently have any clients, pursuant to SCR 3.390, he shall, within ten days from the entry of this Opinion and Order, notify all clients in writing of his inability to represent them, and notify all courts in which he has matters pending of his suspension from the practice of law, and furnish copies of said letters of notice to the Director of the Kentucky Bar Association. Furthermore, to the extent possible and necessary, Respondent shall immediately cancel and cease any advertising activities in which he is engaged.
All sitting. All concur.
ENTERED: January 21,2010.
/s/ John D. Minton Jr.
Chief Justice | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614162/ | 939 So.2d 698 (2006)
David Bradley ARDOIN, et ux.
v.
Dr. Douglas McKAY.
No. 06-0171.
Court of Appeal of Louisiana, Third Circuit.
September 27, 2006.
*699 Jay Pucheu, Attorney at Law, Marksville, LA, for Plaintiffs/Appellants, David Bradley Ardoin and Elizabeth Ardoin.
Marc W. Judice, Judice & Adley, Lafayette, LA, for Defendant/Appellee, Dr. Douglas McKay.
Court composed of Chief Judge ULYSSES GENE THIBODEAUX and Judges JIMMIE C. PETERS and J. DAVID PAINTER.
PETERS, J.
The plaintiffs in this medical malpractice case, David Bradley Ardoin and his wife, Elizabeth Ardoin, appeal a jury verdict rejecting their claim against the defendant, Dr. Douglas McKay. For the following reasons, we affirm the trial court judgment in all respects.
DISCUSSION OF THE RECORD
This litigation arises from a September 23, 1997 surgical procedure performed on Mr. Ardoin by Dr. McKay at the Savoy Medical Center in Mamou, Evangeline Parish, Louisiana. However, Mr. Ardoin's extensive medical history with Dr. McKay *700 actually began in 1989 when the doctor, an orthopedic surgeon, performed a laminectomy and discectomy for a bulging disc at L5-S1. This initial surgical procedure proved successful, and Mr. Ardoin returned to work.
For the next four years, Mr. Ardoin saw Dr. McKay occasionally for pain in his legs or back. However, Mr. Ardoin's involvement in a 1993 oilfield accident caused him to return to Dr. McKay with complaints of more severe pain in his neck and lower back. Over the period of the next three years, Dr. McKay treated Mr. Ardoin for his complaints and referred him to a number of other medical specialists in an effort to pinpoint the cause of his pain and symptoms. The other medical specialists included Dr. Robert Rivet, a neurosurgeon; Dr. Steven Snatic, a neurologist; Dr. Robert Franklin, a physiatrist; Dr. John Humphries, an orthopedic surgeon; Dr. James Domingue, a neurologist; and Dr. Thomas Bertuccini, a neurosurgeon. Although Mr. Ardoin related complaints of severe and constant pain in the neck and low back, these physicians were unable to find the source of his complaints. MRIs, bone scans, an EMG, a nerve conduction study, and a myleogram were all negative for isolating the cause of his constant pain. In fact, only Dr. Bertuccini would hazard a recommendation for follow-up treatment. Based on the longevity of the symptoms, he recommended that Mr. Ardoin undergo a lumbar discectomy.
Despite this inability to isolate the cause of Mr. Ardoin's symptoms, Dr. McKay believed Mr. Ardoin to be totally disabled and continued to search for a medical reason for, and a solution to, his complaints. Agreeing with Dr. Bertuccini's recommendation as to the next logical step, Dr. McKay concluded that Mr. Ardoin would be a good candidate for a new procedure with which he had been experimenting that entailed using a device of his own invention which had proven successful in its limited use. The device was a pie-shaped titanium steel "wedge," which, when surgically placed between the vertebrae of a patient, helped decompress the intervertebral space and allow it to expand to its normal size. The wedge contained "teeth" on the surface to help keep it in place once inserted.[1]
On three different occasions during the summer of 1997, Dr. McKay discussed with Mr. Ardoin and his wife the prospect of performing a fusion to stabilize the spine and inserting a wedge or wedges at the L4-5 level. Mr. Ardoin opted for the procedure, which was performed on September 23, 1997. According to Dr. McKay, throughout the surgery he was able to see directly into Mr. Ardoin's back, observe the exposed nerve, and insert the wedges exactly where they should be placed. The doctor believed the surgery to be a success although an intra-operative fluoroscopy film revealed that one of the wedges was protruding two millimeters into the spinal canal.
For the next fourteen months, Dr. McKay followed Mr. Ardoin's progress and thought his patient was progressing. However, because of continued complaints from the patient, Dr. McKay referred him to Dr. John D. Jackson, a Metairie, Louisiana neurosurgeon, for a second opinion.
Dr. Jackson first saw Mr. Ardoin on December 3, 1998. According to Dr. Jackson, Mr. Ardoin informed him that, immediately after Dr. McKay's surgery, he *701 knew his back was not corrected and that his pain was still present. Mr. Ardoin's initial complaint to Dr. Jackson was that of pain extending from his neck and upper extremities through his low back and lower extremities. Dr. Jackson reviewed x-rays of the lower back taken in December of 1997 and interpreted these to reflect a projection of the wedges posteriorly into the spinal canal at the L4-5 level. Dr. Jackson's own x-ray revealed a six millimeter protrusion of a wedge into the spinal canal.
Dr. Jackson initially informed Mr. Ardoin that he believed the lower back pain was caused by the protruding wedge. However, when he reviewed the results of a post-operative normal EMG study, Dr. Jackson decided to initially treat Mr. Ardoin's complaints conservatively.
Dr. Jackson's continued conservative treatment for the next year and one-half resulted in no improvement in Mr. Ardoin's symptoms. On May 31, 2000, Dr. Jackson performed surgery on Mr. Ardoin wherein he removed the protruding wedge from the disc space at L4-5 and decompressed the nerve roots by replacing the wedge with another type of spacer. Mr. Ardoin's pain was not resolved by this subsequent surgery.
On August 17, 2000, the Ardoins filed a request for review of their malpractice claim by a medical review panel as provided for in La.R.S. 40:1299.47. In their claim, they asserted that Dr. McKay had committed medical malpractice by improperly placing the wedges during the surgical procedure of September 23, 1997, and by not informing them of the possibility of migration of the wedges. After reviewing the evidence presented, the medical review panel found no medical malpractice on the part of Dr. McKay. Specifically, it found that the condition corrected by Dr. Jackson's surgery resulted from migration of the wedges, and not improper placement; that the Ardoins were properly informed of the procedure and the possible complication of migration; that the use of the non-FDA approved wedges was not a breach of the standard of care required of Dr. McKay; and that the doctor's post-operative decision to wait and see if the complaints of pain would resolve themselves was an acceptable course of action and one similarly followed by Dr. Jackson. The medical review panel was comprised of three Lafayette, Louisiana orthopedic surgeons Dr. John E. Cobb, Dr. David Muldowny, and Dr. John R. Budden. All three of the physicians testified at trial as witnesses for Dr. McKay.
After the medical review panel's decision, the Ardoins filed the instant medical malpractice suit against Dr. McKay. In this suit, they again asserted that Dr. McKay failed to obtain informed consent for the procedure and that he improperly placed the wedges during the surgical procedure. After a jury rejected their claims, the Ardoins perfected this appeal.
APPLICABLE STANDARD OF REVIEW
As a preliminary matter, we must consider and respond to the Ardoins' contention, ranked in their appellate brief as their "principle argument," that the appeal should be reviewed de novo. This contention is based on the interpretation of the jury verdict as being manifestly wrong and so contradictory that it should be ignored.
The verdict form provided to the jury was proposed by the Ardoins and was still labeled as "PLAINTIFF'S PROPOSED JURY VERDICT FORM" when it was returned to the trial court after the jury reached its verdict. The relevant part of this verdict form appears as follows:
*702 1. Did plaintiff establish by a preponderance of evidence the standard of care applicable to Dr. McKay? Yes ___ No &chk;
2. Did Dr. McKay breach the standard of care? Yes ____ No &chk;
(If "Yes", continue to No. 3. If "No", report your verdict.)
In compliance with the instruction following the second interrogatory, the jury returned its verdict without answering the remaining interrogatories. The verdict was unanimous.
The questions raised by the jury verdict are the focus of both of the Ardoins' assignments of error. In those assignments of error, they assert:
(1) The jury committed manifest error in finding that the plaintiffs failed to prove the standard of care where the panel members, a treating neurosurgeon and the defendant himself agreed on the standard of care in the testimony presented.
(2) The jury committed manifest error in answering the second Jury interrogatory when its answer to the first precluded an answer.
Basically, they argue that we should find manifest error in the responses to both interrogatories, perform a de novo review of the record, find that Dr. McKay breached the standard of care applicable to him, and award them damages for that breach.
In making this argument, they rely on the principle of appellate review as stated in Oubre v. Eslaih, 03-1133 (La.2/6/04), 869 So.2d 71. In that case, the supreme court stated that, "if a court finds that the trial court committed a reversible error of law or manifest error of fact, the court of appeal must ascertain the facts de novo from the record and render a judgment on the merits." Id. at 76. The Ardoins argue that they established the standard of care through the testimony of at least five doctors, including Dr. McKay himself. That being the case, the Ardoins assert that the jury's answer to the first interrogatory was manifestly erroneous and that we should ignore the response to the second interrogatory because, assuming the jury believed that no standard of care had been established, it should not have answered the second interrogatory.
We agree that the standard of care on both the question of informed consent and the placing of the wedges was well established by the trial record. However, there are a number of reasonable explanations for the jury's responses to the interrogatories. One is that the jury did not appreciate the precise meaning of the first interrogatory. That is to say, the jury could well have thought that the two interrogatories were asking essentially the same question. Another is that the jury believed the standard of care was established, but by Dr. McKay, and not by the Ardoins.
A third and more likely explanation for the apparent inconsistency is that the parenthetical instruction following the second interrogatory, (If "Yes", continue to No. 3. If "No" report your verdict.), was itself confusing. A negative answer to the first interrogatory essentially terminated the litigation and eliminated the need to answer the second interrogatory. However, because it contained no parenthetical instruction similar to that following the second interrogatory, the jury could have construed the instruction as applying to both interrogatories and could have concluded that a verdict for the doctor required it to answer "No" to both interrogatories.[2]
*703 In any event, whatever the jury's confusion may have been as to the first interrogatory, there can be no doubt it understood the second. This interrogatory asked for the jury's verdict on the heart of the case whether Dr. McKay breached the standard of care applicable to his treatment of Mr. Ardoin. The jury's answer to that question and its compliance with the parenthetical instruction following that interrogatory leave no doubt concerning the jury's belief on this issue.
Misleading or confusing interrogatories may constitute reversible error, but the manifest error standard of appellate review still applies except where the jury interrogatories are so inadequate or incorrect as to preclude the jury from reaching a verdict based on the law and the facts. Doyle v. Picadilly Cafeterias, 576 So.2d 1143 (La.App. 3 Cir.1991). We do not find that the exception applies in this case. Thus, we reject the Ardoins' argument that we should review the verdict de novo.
Having concluded that the standard of care applicable to Dr. McKay was established, we turn to the issue of whether the jury committed manifest error in concluding that Dr. McKay did not breach that standard of care. In addressing this issue, we note that the Ardoins' assignments of error relate solely to the answers to the interrogatories and their request for a de novo review. In doing so, they do not particularly specify, as an alternate assignment of error, manifest error on the merits of the jury's findings on the standard of care issue. Under Uniform Rules Courts of Appeal, Rule 1-3, this court "will review only issues which were submitted to the trial court and which are contained in specifications or assignments of error, unless the interest of justice clearly requires otherwise." Thus, the question arises whether a review based on manifest error is properly before this court. We have answered that question in the affirmative for several reasons.
One reason is that nowhere in his appellate brief does Dr. McKay take the position that, if we reject the request for a de novo review, that action would terminate the litigation. Instead, he treats the appeal in his brief as addressing manifest error and responds accordingly. Additionally, we are mindful of the supreme court's decision in Nicholas v. Allstate Insurance Co., 99-2522, (La.8/31/00), 765 So.2d 1017, where the supreme court concluded that the appellate court should have addressed a particular issue in that litigation even though it had not been assigned as error. In reaching that conclusion, the supreme court cited La.Code Civ.P. art. 2129, which provides that an assignment of error is not necessary in any appeal, and La.Code Civ.P. art. 2164, which provides that an appellate court "shall render any judgment which is just, legal, and proper upon the record on appeal." The Nicholas court also emphasized that Uniform Rules Courts of Appeal, Rule 1-3, was applicable "unless the interest of justice clearly requires otherwise."
Liberally construing the Ardoins' argument in brief, we can glean from it that they are also challenging the verdict from the standpoint of manifest error as to its findings on the merits that there was no breach of the standard of care. Therefore, we will now address that issue.
OPINION
Louisiana Revised Statutes 9:2794 sets forth the burden of proof required in a *704 medical malpractice case and provides in pertinent part:
A. In a malpractice action based on the negligence of a physician licensed under R.S. 37:1261 et seq., . . . the plaintiff shall have the burden of proving:
(1) The degree of knowledge or skill possessed or the degree of care ordinarily exercised by physicians, dentists, optometrists, or chiropractic physicians licensed to practice in the state of Louisiana and actively practicing in a similar community or locale and under similar circumstances; and where the defendant practices in a particular specialty and where the alleged acts of medical negligence raise issues peculiar to the particular medical specialty involved, then the plaintiff has the burden of proving the degree of care ordinarily practiced by physicians, dentists, optometrists, or chiropractic physicians within the involved medical specialty.
(2) That the defendant either lacked this degree of knowledge or skill or failed to use reasonable care and diligence, along with his best judgment in the application of that skill.
(3) That as a proximate result of this lack of knowledge or skill or the failure to exercise this degree of care the plaintiff suffered injuries that would not otherwise have been incurred.
Our review of the factual findings of the jury must be conducted in accordance with the familiar precept announced by our supreme court that, "[i]f the trial court or jury's findings are reasonable in light of the record reviewed in its entirety, the court of appeal may not reverse, even though convinced that had it been sitting as the trier of fact, it would have weighed the evidence differently." Sistler v. Liberty Mut. Ins. Co., 558 So.2d 1106, 1112 (La.1990). Also, "[w]here there are two permissible views of the evidence, the factfinder's choice between them cannot be manifestly erroneous or clearly wrong." Rosell v. ESCO, 549 So.2d 840, 844 (La. 1989).
"[E]xpert witnesses who are members of the medical profession are necessary sources of proof in medical malpractice actions to determine whether the defendant doctor possessed the requisite degree of skill and knowledge, or failed to exercise reasonable care and diligence." Martin v. E. Jefferson Gen. Hosp., 582 So.2d 1272, 1277 (La.1991). "The determination of an expert's credibility is also a factual question subject to the manifestly erroneous/clearly wrong standard of review." Id.
Informed Consent Issue
With regard to the question of informed consent, La.R.S. 40:1299.40(A)(1) provides:
Notwithstanding any other law to the contrary, written consent to medical treatment means a handwritten consent to any medical or surgical procedure or course of procedures which: sets forth in general terms the nature and purpose of the procedure or procedures, together with the known risks, if any, of death, brain damage, quadriplegia, paraplegia, the loss or loss of function of any organ or limb, of disfiguring scars associated with such procedure or procedures; acknowledges that such disclosure of information has been made and that all questions asked about the procedure or procedures have been answered in a satisfactory manner; and is signed by the patient for whom the procedure is to be performed, or if the patient for any reason lacks legal capacity to consent by a person who has legal authority to consent on behalf of such patient in such circumstances. Such consent shall be presumed to be valid and effective, in *705 the absence of proof that execution of the consent was induced by misrepresentation of material facts.
To meet the burden of proof in an informed consent case, a plaintiff must prove the existence of a material risk unknown to the patient, a failure on the part of the physician to disclose the risk, that disclosure of the risk would have led a reasonable person in the plaintiff's position to reject the procedure or to choose a different course of treatment, and injury arising from the procedure. Fremin v. Continental Ins. Co., 02-1157 (La.App. 3 Cir. 3/5/03), 839 So.2d 1137, writs denied, 03-966, 03-979, 03-981 (La.6/27/03), 847 So.2d 1271, 1272. With regard to the materiality issue, the supreme court in Hondroulis v. Schuhmacher, 553 So.2d 398, 412 (La.1989), stated:
The determination of materiality is a two-step process. The first step is to define the existence and nature of the risk and the likelihood of its occurrence. "Some" expert testimony is necessary to establish this aspect of materiality because only a physician or other qualified expert is capable of judging what risk exists and the likelihood of occurrence. The second prong of the materiality test is for the trier of fact to decide whether the probability of that type harm is a risk which a reasonable patient would consider in deciding on treatment. The focus is on whether a reasonable person in the patient's position probably would attach significance to the specific risk. This determination of materiality does not require expert testimony.
In reviewing an informed consent decision, we must not substitute our own factual findings for that of the trier of fact, and the evidence must be viewed in the light most favorable to the party who prevailed before the trier of fact. Thibodeaux v. Jurgelsky, 04-2004 (La.3/11/05), 898 So.2d 299.
The Ardoins argue that Dr. McKay failed to inform them of the existence of posterior migration of the wedge and that such a possibility was a material risk which would have lead Mr. Ardoin to reject the procedure and choose another course of treatment. Put another way, the Ardoins argue that Dr. McKay should have specifically informed them that posterior migration was a possibility of the procedure and that it might cause nerve irritation. The evidentiary record is clear that Dr. McKay did not make the specific disclosure suggested by the Ardoins.
Dr. McKay testified that he met with the Ardoins three times before the surgery and that at those meetings he used illustrations to explain the procedure, invited questions, and answered all questions that were asked. Four days before the surgery, Mr. Ardoin signed four different consent forms authorizing Dr. McKay to perform the anticipated procedure. One of the forms contained general warnings that the wedge or wedges "may sink into the bone," or "may slip," or "may become loose." It further warned that the wedges could cause bleeding, leakage of spinal fluid, allergic reaction, or infection. Furthermore, it warned that the infection could result in blood clots, additional surgical intervention, and neurological weakness. However, one of the forms contained the statement that, should a wedge slip, it "should slip anteriorly and not cause any problems," but made no mention of posterior slippage.
In support of their position, the Ardoins submitted the testimony of Dr. Cobb and Dr. Budden. Dr. Cobb testified that, when the surgeon places the wedge in the intervertebral space from the back, or posteriorly, he should expect any migration to be posteriorly. Thus, he always informs *706 his patient that the chance of migration is greater posteriorly than anteriorly. Dr. Budden also testified that the risk of posterior migration into the spinal canal was one which should be related to the patient, but he did not believe that it was a significant risk.
On the other hand, Dr. Muldowny, whose orthopedic surgical practice emphasizes spine surgery, testified that the applicable standard of care does not require a specific warning that the instrumentation might migrate and pinch a nerve. He felt it would suffice "to make a more general statement that there may be . . . a problem with the instrumentation that might damage a nerve that might require additional surgery."
Obviously, the jury chose to believe Dr. Muldowny, and we find no manifest error in that conclusion with regard to the issue of informed consent. That is to say, we cannot say that the jury erred in concluding that a specific disclosure of the risk of posterior migration, in those terms, would have led a reasonable person in Mr. Ardoin's position to reject the procedure or to choose a different course of treatment. This aspect of the Ardoins' argument has no merit.
Insertion of Wedges Issue
All of the physicians who testified stated that it would be a breach of the standard of care required of Dr. McKay if he placed the wedges in such a manner as to touch a nerve. Specifically, had the wedges been placed where they protruded six millimeters into the spinal canal, that would have been a breach of the standard of care. Additionally, there was general agreement among the physicians who testified that migration is one of the hazards of the procedure and that the existence of migration does not indicate a breach of the standard of care.
In their opening statement, the Ardoins informed the jury that they would prove by a preponderance of the evidence that the wedges were initially placed by Dr. McKay in a position where they were protruding into the spinal canal and irritating nerve roots. They further asserted that the wedges continued to irritate the nerve roots until their removal by Dr. Jackson. It is not disputed that Dr. Jackson removed the wedges from a position where one was protruding six millimeters from its proper position and was impinging on a nerve. However, no physician testified that the wedges were protruding six millimeters when placed by Dr. McKay. Thus, the question is whether the Ardoins established by a preponderance of the evidence that Dr. McKay's initial placement resulted in nerve root irritation, regardless of the extent of protrusion.
Dr. Stephen Pflug, a radiologist, testified for the Ardoins and is basically the only physician who testified that the initial placement breached the standard of care. He testified that, when he examined two x-ray images ordered by Dr. McKay on the date of the surgery, he observed that the wedge protruded approximately two millimeters into the spinal canal. However, he acknowledged on cross-examination that the normal posterior projection of the annulus fibrosis is about two millimeters, and, therefore, he could not state for a fact that the two millimeter protrusion impinged on a nerve. Additionally, Dr. Muldowny testified that the two millimeter protrusion was not a breach of the appropriate standard of care.
According to Dr. Muldowny, the posterior margin of the spinal canal is not necessarily the same as the posterior margin of the bone. He suggested that there could be additional material such as a fibrous cartilaginous implate that sticks beyond the bone that x-rays would not detect. *707 Thus, the x-rays may provide a false picture concerning the location of the wedge, even to the extent of showing that it appears to be placed right on the edge of a nerve root. He testified that the surgeon performing the procedure can clearly see the nerve root and has a much better view of the wedge's specific location in relation to that nerve root. He further noted that the outside portion of the disc itself, the annulus fibrosis, normally projects into the canal about two millimeters. In his opinion, Dr. McKay placed the wedges properly during surgery, and at least one migrated thereafter.
Even Dr. Jackson was of the opinion that Dr. McKay placed the wedges in proper position and that they migrated thereafter. Although he testified that, at the time he performed surgery to remove and replace the wedges, one had migrated backwards into the spinal canal and slightly laterally to the edge of the dura and was encroaching on the neural foramen, he further stated that "[t]hose things sometimes move" and that "that's just one of the complications that can occur."
Given the medical testimony, we find no error in the jury's determination that Dr. McKay did not breach the standard of care in placing the wedges during the September 23, 1997 surgery.
PRESCRIPTION
After trial and before appeal, Dr. McKay filed a peremptory exception of prescription, urging the application of the one-year prescriptive period established in La.R.S. 9:5628. The jury's verdict mooted that issue at the trial level, and the trial court never considered it. Dr. McKay has again urged that exception on appeal. Because we affirm the jury's verdict in full, we find it unnecessary to address that exception.
DISPOSITION
For the foregoing reasons, we affirm the trial court judgment in all respects. We tax all costs of this appeal to David Bradley Ardoin and Elizabeth Ardoin.
AFFIRMED.
NOTES
[1] The device Dr. McKay had designed and was using was not yet approved by the FDA, but, subsequent to September 23, 1997, the date of the surgery involved in this case, Johnson & Johnson obtained the licensing right for the device (differing only in respect to the material used to form it), and it became FDA approved.
[2] Neither the jury charges nor the closing arguments directed the jury's attention to the interrogatories specifically. The closest that anyone came to guiding the jurors in their consideration of the specific interrogatories was when one of the attorneys told them to "follow the instructions on the sheet." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614169/ | 939 So.2d 948 (2005)
Gary Davis HART II
v.
STATE of Alabama.
CR-05-0056.
Court of Criminal Appeals of Alabama.
November 23, 2005.
Rehearing Denied February 3, 2006.
Certiorari Denied April 14, 2006.
Eric J. Magnuson, Minneapolis, Minnesota, for appellant.
Submitted on appellant's brief only.
Alabama Supreme Court 1050659.
PER CURIAM.
The appellant, Gary Davis Hart II, appeals the circuit court's order setting aside his sentence of death pursuant to Roper v. Simmons, 543 U.S. 551, 125 S.Ct. 1183, 161 L.Ed.2d 1 (2005), and sentencing him to life in the penitentiary without the possibility of parole.
In 1990, Hart was convicted of capital murder for the killing of Todd Evans during the course of a robbery. He was sentenced to death. Hart's conviction and his sentence were affirmed on direct appeal. Hart v. State, 612 So.2d 520 (Ala. Crim.App.1992), aff'd, 612 So.2d 536 (Ala. 1993).
Hart also filed a petition for postconviction relief under Rule 32, Ala.R.Crim.P. attacking his conviction. On appeal, we affirmed the denial of Hart's Rule 32 petition. Hart v. State, 796 So.2d 446 (Ala. Crim.App.1999) (table), aff'd, 800 So.2d 140 (Ala.2000).
In August 2005, the attorney general filed a motion in the Mobile Circuit Court requesting that the circuit court vacate Hart's death sentence based on the United States Supreme Court's decision in Roper v. Simmons, 543 U.S. 551, 125 S.Ct. 1183, 161 L.Ed.2d 1 (2005), which prohibited the imposition of a sentence of death on any individual under the age of 18 when the offense was committed. Hart was 16 when he committed the murder. The motion stated:
"Comes now the State of Alabama, Respondent in the above-styled cause, and files its motion respectfully requesting that this Honorable Court re-sentence Gary Davis Hart, II, to life imprisonment *949 without the possibility of parole, pursuant to United States District Court Judge Charles R. Butler, Jr.'s order instructing the State to re-sentence Hart to life imprisonment without the possibility of parole within thirty days. In support of this motion, the State submits the following;
"1. In Roper v. Simmons, 125 S.Ct. 1183, 1200 (2005), the United States Supreme Court held that the `Eighth and Fourteenth Amendments forbid (the) imposition of the death penalty on offenders who were under the age of 18 when their crimes were committed.' Based on the Court's ruling in Roper, inmates who were convicted of capital murder and sentenced to death for a capital offense that they committed when they were under the age of eighteen are no longer eligible for the death penalty.
"2. Hart's capital murder conviction and death sentence currently are under habeas review in the United States District Court for the Southern District of Alabama. On June 8, 2005, United States District Court Judge Charles R. Butler, Jr., ordered the parties to file their respective positions on the effect of Roper on Hart's penalty phase claims. The parties complied with the court's order. In their pleadings, the parties agreed that the court should grant Hart habeas corpus relief if the court found, based upon its review of the evidence, that Hart was under the age of eighteen when he committed the capital murder of Todd Evans.
"3. On August 8, 2005, Judge Butler entered an order finding that Hart was, in fact, under the age of eighteen when he murdered Todd Evans. In that order, Judge Butler instructed the State to re-sentence Hart to life imprisonment without the possibility of parole within the next thirty days. See `Appendix.'
"4. The State agrees with Judge Butler's finding that Hart was under the age of eighteen when he murdered Todd Evans and that he is, therefore, entitled to penalty phase relief under Roper. Roper requires this Court to enter an amended sentencing order sentencing him to life imprisonment without the possibility of parole."
The circuit court vacated Hart's death sentence and sentenced Hart to life imprisonment without the possibility of parolethe only other available sentence for a person who has been convicted of a capital offense. See § 13A-5-45, Ala.Code 1975. Hart filed a notice of appeal. The question presented by this case is whether Hart has the right to appeal this ruling.
Section 12-22-130, Ala.Code 1975, governs appeals from convictions. This statute states:
"A person convicted of a criminal offense in the circuit court or other court from which an appeal lies directly to the Supreme Court or Court of Criminal Appeals may appeal from the judgment of conviction to the appropriate appellate court."
"The right of appeal is wholly statutory. Under our statute an appeal is authorized in criminal cases only from a judgment of conviction." Dawson v. State, 37 Ala.App. 16, 17, 66 So.2d 567, 568 (1952) (emphasis added). The Alabama Supreme Court in Allen v. State, 141 Ala. 35, 37 So. 393 (1904), addressed whether a defendant could appeal an order scheduling a date for the defendant's execution. The Supreme Court stated:
"Section 4313 of the Criminal Code [of 1896] [now § 12-22-130, Ala.Code 1975], relating to appeals by defendants in criminal cases, reads as follows: `Any person convicted of a criminal offense in the circuit court, or other court from *950 which an appeal lies directly to the Supreme Court, may appeal from the judgment of conviction to the Supreme Court.' It will be observed that the statute authorizes an appeal only from the judgment of conviction. The present appeal is not taken from the judgment of conviction, but from the sentence of the circuit court made under section 5439 of the Criminal Code [of 1896], appointing a day for the execution of the defendant. And as no appeal lies from such an order, this court is without jurisdiction to review the case, and it follows that the appeal must be dismissed."[1]
141 Ala. at 36-37, 37 So. at 393.
In Dixon v. City of Mobile, 859 So.2d 462, 463 (Ala.Crim.App.2003), we likewise stated:
"`The right of appeal is wholly statutory and is authorized in criminal cases from a judgment of conviction.' McCray v. State, 46 Ala.App. 588, 589, 246 So.2d 475, 476 (Ala.Crim.App.1971). `Appeals lie only from judgments of conviction, and then only on those counts upon which there is a finding of guilt.' Thornton v. State, 390 So.2d 1093, 1096 (Ala.Crim.App.1980). `An appeal cannot be taken from an order subsequent to the judgment of conviction unless authorized by statute.' Harris v. State, 44 Ala.App. 632, 632, 218 So.2d 285, 286 (1969)."
There is no statute that allows Hart to appeal the circuit court's ruling vacating his sentence of death and imposing a sentence of life imprisonment without the possibility of parole. Hart has already obtained appellate review of the proceedings that lead to his capital-murder conviction.
Because there is no statutory authority for this Court to review this appeal, this appeal is dismissed.
APPEAL DISMISSED.
McMILLAN, P.J., and COBB, BASCHAB, SHAW, and WISE, JJ., concur.
NOTES
[1] Rule 8(d)(1), Ala.R.App.P., states that the Supreme Court "shall at the appropriate time enter an order fixing a date of execution." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1619211/ | 152 So.2d 721 (1963)
FRIENDLY FROST USED APPLIANCES and American Fire and Casualty Company, Petitioners,
v.
Paul REISER and Florida Industrial Commission, Respondents.
No. 31772.
Supreme Court of Florida.
April 3, 1963.
Rehearing Denied May 13, 1963.
Edwin H. Underwood, Jr., Miami, Gerald T. Nolan and Wakefield & Underwood, Miami, for petitioners.
Donald Feldman, Coral Gables, and Kaplan, Ser & Abrams, Miami, for Paul Reiser.
Burnis T. Coleman and Patrick H. Mears, Tallahassee, for respondents.
O'CONNELL, Justice.
The claimant, respondent Paul Reiser, was employed by the employer, Friendly Frost Used Appliances, as a truck driver, deliveryman and shop worker. He spent approximately 40% of his time delivering *722 appliances and 60% in the shop assisting in the repair of used appliances.
The employer was in the business of repairing and selling used major appliances weighing from 25 to 350 pounds, including gas refrigerators weighing approximately 310 pounds.
In performing his duties as truck driver-deliveryman claimant was required to load appliances on a truck and deliver them to purchasers. In this function claimant had the assistance of an elderly man but claimant testified this helper rendered little assistance because of his age and inability "to do much lifting."
Claimant testified that beginning about four weeks prior to the date of the event here involved he loaded and delivered several of the 310 pound gas refrigerators above mentioned, and on those occasions he experienced pains in his chest. He testified that he experienced similar pains on every occasion that he loaded and delivered this type of refrigerator, but that they would disappear after a few minutes rest. He attributed these pains to indigestion and/or bad drinking water at his place of employment.
On Saturday afternoon, August 27, 1960, claimant without assistance or use of a dolly was required to "catwalk" one of these gas refrigerators about 15 feet onto a hoist by which it was raised to a truck.
He testified that he had the same chest pains during this exertion that he had on previous occasions; they lasted a few minutes; he was very tired during Saturday evening; and that after breakfast the next morning he was working a puzzle in his apartment when the pains appeared in his chest and then spread to both arms. He was taken immediately to a hospital where he remained for treatment. Diagnosis of claimant's condition showed pre-existing arteriosclerosis and hypertension and indicated that he had suffered a myocardial infarction.
A claim was filed and ultimately the deputy commissioner entered an order in which he found that claimant's activity in lifting the gas refrigerators for some weeks before August 28, the day of the disabling attack, accelerated or aggravated the claimant's pre-existing diseased arteries causing the myocardial infarction. He found that all of claimant's medical care and temporary total disability compensation was related to the "accident of August 27, 1960, without ruling whether there shall be any apportionment of benefits for any permanent residual disability."
The full commission affirmed the deputy's order, one member dissenting.
The petitioner argues that the deputy did not find that the disabling infarct was due to any "unusual strain or overexertion not routine to the type of work he was accustomed to performing" as this Court recently said is essential to recovery in cases of aggravation of pre-existing heart diseases. See Victor Wine & Liquor, Inc. v. Beasley, Fla. 1962, 141 So.2d 581, 589.
Petitioner's contention is well founded, the deputy merely found that "the lifting event on August 27, 1960 was of such nature as to constitute an accident arising out of and in the course of his employment." Had the deputy's order in this cause been rendered subsequent to the rendition of our opinion in Victor Wine, supra, the lack of the essential finding that the infarct was due to unusual strain or overexertion would be fatal. However, this order was rendered prior to the ultimate decision in the Victor Wine case. Therefore, we will treat the deputy's order as if it contained the pertinent finding and turn then to a determination of whether the record contains competent substantial evidence which will support such a finding.
The only evidence in the record which indicates that the lifting incident constituted "unusual strain" or "overexertion" is found in the testimony of Dr. Morton M. Halpern.
Unfortunately for claimant, Dr. Halpern in candor admitted that he based his statement that the incident constituted unusual *723 effort or strain on the history related to him by the claimant.
It is worthy of note here that Dr. Halpern expressed the view that seems to relate strain and the question of whether it is excessive or unusual to the individual involved, rather than to the ordinary requirements of the employment. It was his opinion that unusual strain or stress could be unusual every day even though it arose out of work which was habitually or regularly performed by the individual and normally required by his employment.
Dr. Halpern's view is interesting and understandable, but it is directly opposed to the position adopted by this Court in the Victor Wine case in which we established the usual and ordinary requirements of the employment as the norm and held that a disabling heart condition occasioned by exertion or strain normal to the employment would not be compensable.
Returning to the testimony of Dr. Halpern indicating that his opinion, that the lifting incident here involved constituted unusual effort or strain, was based on the history given him by claimant, we are forced to the conclusion that there is no evidence in the record to support this history and therefore the opinion must be held to have no evidentiary value. Arkin Construction Co. v. Simpkins, Fla. 1957, 99 So.2d 557.
Neither the claimant's testimony nor any other evidence in the record establishes that the lifting incident of August 27th was unusual or not routine to his employment. He testified that he had handled the identical type gas refrigerator on several occasions prior to the pertinent date. There is no evidence showing that moving appliances of the size and weight of these refrigerators was not routine to the employment. The absence of a helper on this date is not significant for claimant testified that the helper assigned to him on other occasions was an elderly man who gave little or no assistance.
Claimant's employer testified that the moving of appliances weighing as much as 350 pounds was routine to claimant's work.
With Dr. Halpern's opinion stripped of evidentiary value the record is left devoid of competent substantial evidence that the lifting incident of August 27th constituted unusual strain or overexertion not routine to the type of employment in which claimant was engaged so as to bring it within the rule laid down in the Victor Wine case. It follows that the orders of the deputy and the full commission must be reversed on authority of that case.
Accordingly, the petition for writ of certiorari is hereby granted, the order of the full commission quashed, and the cause remanded with directions to the commission to enter an order quashing the order of the deputy commissioner.
ROBERTS, C.J., and TERRELL, THOMAS and CALDWELL, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920182/ | 337 A.2d 651 (1975)
SUNDOR ELECTRIC, INC., a corporation of a State other than the State of Delaware, Defendant below, Appellant,
v.
E. J. T. CONSTRUCTION CO., INC., a Delaware Corporation, Plaintiff below, Appellee.
Supreme Court of Delaware.
Submitted December 2, 1974.
Decided April 17, 1975.
R. Brandon Jones, Dover, for defendant below, appellant.
John J. Schmittinger of Schmittinger & Rodriguez, Dover, for plaintiff below, appellee.
Before HERRMANN, C. J., and DUFFY and McNEILLY, JJ.
DUFFY, Justice:
This appeal is from an order of the Superior Court entering a default judgment against defendant for failure to answer interrogatories.
I
The action is for breach of contract with damages claimed of more than $25,000. On March 1, 1974 defendant was ordered to answer interrogatories not later than *652 March 15. The Court deferred a ruling on plaintiff's motion to award counsel fees (sought because of delay in answering the interrogatories) and permitted defendant to state any objection to specific questions at the time the answers were filed. In a writing filed on March 13 defendant answered some of the interrogatories and objected to others.
On March 15 plaintiff moved for a default judgment and in granting the motion the Superior Court stated:
"Under Rule 37(a) (3) the answers to interrogatories 1, 2, 3, 4, 5, 6, & 7 are evasive and incomplete. Judgment is entered against the defendant in accordance with Rule 37(b) (2)(c)."
This appeal followed.
II
Superior Court Rule 37(b) (2) (C), like the comparable Federal Rule, permits a judgment by default against a party who fails to comply with an order of Court. Judgment by default is, of course, the extreme remedy and generally speaking the Rule has been interpreted to require "some element of wilfulness or conscious disregard of the order" before such a sanction is imposed. 4A Moore's Federal Practice (2 ed) § 37.03[2.5].[1] It has been frequently held that a motion for such a judgment will be granted "if no other sanction would be more appropriate under the circumstances." Annot., 6 A.L.R.3d 713 Pretrial Proceedings § 11. To state it otherwise, sanctions provided by the Rule for failure to make discovery "are not ordinarily applied where there has been an active, good faith effort to comply." Annot., 2 A.L.R.Fed. 811 Discovery Failure to Obey § 2. See Warner v. Warner Co., Del.Super., 4 Storey 478, 180 A.2d 279 (1962).
On appeal the issue is whether or not the Trial Court abused its discretion. See Williams v. Hall, Del.Super., 4 Storey 350, 176 A.2d 608 (1961).
III
We agree with the conclusion of the Trial Court that the answers to the questions were evasive and that sanctions were appropriate but, in our view, judgment by default was too severe a penalty. For that reason the judgment must be reversed. We note particularly the absence of wilfulness in defendant's conduct, the relatively short period of time involved and that defendant did file answers within the time specified by the Court.[2] And defendant was specifically permitted by the Court to include objections to questions with the answers to others. That procedure contributed to the procedural impasse.
It seems to us that, under the circumstances found in the record, counsel for defendant (local and out-of-State), and not the party, bear the responsibility for preparing and filing such an inadequate document and must therefore answer for it. Sanctions may be imposed upon counsel under Rule 37(b) (2), which specifically provides:
"In lieu of any of the foregoing orders or in addition thereto, the court shall require the party failing to obey the order or the attorney advising him or both to pay the reasonable expenses, including attorney's fees, caused by the failure, unless the court finds that the failure was substantially justified or that other circumstances make an award of expenses unjust." (Emphasis supplied.)
*653 * * *
The judgment of the Superior Court is reversed with directions to strike the order of default, to require further and complete answers by defendant, and to hold a hearing for the purpose of determining what amount defendant's attorneys should be required to pay by way of sanction under Rule 37(b)(2).
NOTES
[1] See, e. g., Trans World Airlines v. Hughes, 2 Cir., 449 F.2d 51 (1971), in which a default was entered because of defendant's "repeated and contumacious" refusal to appear for his disposition.
[2] It appears that the principal shareholder of the corporate defendant, acting as agent, made with plaintiff the oral contract which is the subject of this action. His death prior to initiation of discovery apparently put a burden on defendant in answering the interrogatories. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920186/ | 337 A.2d 226 (1975)
POTOWOMUT GOLF CLUB, INC.
v.
John H. NORBERG, Tax Administrator.
No. 73-292-M.P.
Supreme Court of Rhode Island.
May 9, 1975.
Rabinowitz & Zimmerman, Coleman B. Zimmerman, Providence, for petitioner.
Richard J. Israel, Atty. Gen., W. Slater Allen, Jr., Asst. Atty. Gen., Perry Shatkin, Chief Legal Officer (Taxation), Providence, for respondent.
OPINION
KELLEHER, Justice.
We have issued a writ of certiorari pursuant to the Administrative Procedures Act, G.L. 1956 (1969 Reenactment) § 42-35-16. The petitioner, Potowomut Golf Club, Inc., is seeking our review of a Superior Court order which upheld the tax administrator's assessment of a deficiency as to certain sales tax due the state.
Potowomut Golf Club provides more than exercise for its members it also serves food and liquor to them and their guests. It seems, however, that the members were more interested in the first eighteen holes than the proverbial nineteenth, because in 1966 the board of governors, which is charged with operating the club, was faced with an economic problem. Its members were not buying enough victuals and liquid refreshments to make the club's restaurant profitable. The board voted to raise the needed money by imposing a *227 "* * * $15 per month minimum charge * * * [on] all Golf-playing members * * * this charge to be applied against food and liquor, not to include entrance fees to social events * * *." In 1968, the resolution was amended so that the charge would be applied only against food purchases. Thus, if a member consumed at least $15 per month in foodstuffs, he would not incur any additional charges by the club, but if he consumed less, he would be assessed the difference between the amount of his consumption and the $15 fee.
The club, recognizing that any sale of food to its members was subject to the 5 percent sales tax, G.L. 1956 (1970 Reenactment) §§ 44-18-7 and 44-18-18, duly complied with all the taxing laws and paid the tax on its gross receipts realized from the actual sale of food. It did not pay any tax on the $15 fee or the remainder of such fee which represented unconsumed food.
Upon an audit of the club's books, the tax administrator determined that any unused portion of the monthly minimum charge was also subject to the sales tax, and assessed the deficiency on the total amount of the unused portion of the $15 fees that remained in the food charge account. The club objects to this particular assessment, and the correctness of the administrator's decision is the sole issue before us.
Rhode Island imposes a tax on all retail sales at the rate of 5 percent of the gross receipts from such sales. Section 44-18-18. "Gross receipts" comprise the total amount received in respect of the sale price of the retail sales of all retailers. Section 44-18-13.
Section 44-18-7 classifies nearly a dozen different transactions as sales. The two that are pertinent to this controversy are §§ 44-18-7C and 44-18-7D. Subsection C defines the following as a sale: "The furnishing and distributing of tangible personal property for a consideration by social, athletic, and similar clubs and fraternal organizations to their members or others." Subsection D defines a sale as: "The furnishing, preparing, or serving for a consideration of food, meals, or drinks, including any cover, minimum, entertainment, or other charge in connection therewith." The club takes the position that only an actual sale of food is taxable by virtue of § 44-18-7C. The tax administrator concentrates his fire on § 44-18-7D. The statute, he says, includes within a taxable sale any "minimum charge" which is connected with the preparation, furnishing, or serving of food. As justification for his actions, the administrator relies on the language of § 44-18-7D, the language used by the board in its resolution where it speaks of a $15 "minimum charge," and to the undisputed fact that the charge is related to the furnishing of food. On the other hand, the club argues that its unexpended food fees do not come within the statutory reference to minimum or cover charges but are in actuality special assessments or additional membership dues, both of which admittedly are not subject to any sales tax. We agree with the club.
In determining the nature of the club's receipts in this assessment, we are guided by the basic proposition that taxing statutes are to be strictly construed against the taxing authority. "Doubts as to the construction of [taxing] laws of this character are to be resolved in favor of the taxpayer. The legislative intent to impose the burden of a tax is not to be found by implication nor conjecture. Before approving an assessment a court may well require that its authorization be clearly and explicitly expressed in the law." Manning v. Board of Tax Comm'rs, 46 R.I. 400, 410, 127 A. 865, 870 (1925); United Transit Co. v. Hawksley, 86 R.I. 53, 133 A.2d 132 (1957).
Our function in interpreting the statute at issue here is no different than when we are faced with the task of *228 construing any law to ascertain the legislative intent. In so doing, we assume that the Legislature, when it employed the language of § 44-18-7, subd. D, intended to give it its ordinary plain meaning and sense in the context within which it is used. United Transit Co. v. Hawksley, supra. Although the Legislature and the golf club resolution both employ the term "minimum charge," the differing contexts in which the term is used lead us to conclude that different meanings were intended. The Legislature in enacting § 44-18-7, subd. D obviously was attempting to anticipate the problems which would arise when a nightclub operator or an owner of a restaurant tried to segregate his gross receipts into those which came from the actual purchase and consumption of food or liquor and those which came from a so-called cover or minimum charge. Foreseeing the problems of factual proof and recordkeeping that could arise, and recognizing that such cover and minimum charges were so inter-twined with the actual serving of the food or drink, the legislation mandated their taxation. However, the minimum charge assessed by the club in this case is of a different nature. Even if a club member never enters the dining room and never orders so much as a cup of coffee, he will be charged the $15 fee. The relationship between the fee and the food actually consumed is more tangential.
The Legislature in employing the words "minimum charge" to describe that part of the gross receipts subject to taxation clearly did not intend to include a minimum charge such as that assessed against the golf club's members. The plain and common meaning of the phrase "minimum charge" does not encompass such assessments as that placed upon its members by the Potowomut Golf Club.
The burden here is on the tax administrator to overcome the presumption of nontaxation. His mere reference to the language of the statute has not convinced us that the Legislature intended to impose a sales tax upon any remaining balance of each monthly $15 assessment.
While our research has failed to uncover a case exactly in point, we do note that the California Sales Tax Counsel has issued a ruling to the effect that amounts paid to meet minimum food and drink requirements imposed upon country club members are to be considered additional costs of membership rather than taxable additional amounts paid for food. The rationale adopted there was that the purpose of the minimum requirement was to keep the restaurant at a break-even level in lieu of making up a deficit from other club accounts, dues, or assessments and thus the members have a social reason for paying the minimum although no tangible personal property which would be subject to taxation is consumed. California Sales Tax Counsel Ruling, July 22, 1969, found in CCH All State Sales Tax Reports ¶ 2-025.09 at 2033; ¶ 7-150.09 at 7221 (1974).
The federal courts have also faced the problem of differentiating dues or membership fees from charges for food and liquor. Until its repeal in 1966,[1] and excise tax was imposed by the federal government upon all dues or membership fees above a certain minimum imposed by social clubs. Internal Rev. Code of 1954, § 4242. In litigation revolving around the taxability of minimum drink and food purchase requirements of country clubs, the federal courts have been faced with a problem the direct counterpart of ours. In those cases the roles were reversed; the taxing authority did its utmost to argue that the minimum purchase requirements were the equivalent of dues or membership fees, whereas the clubs strove just as hard to convince the court that the charges were actually tied to purchases of food and other tangible personal property not subject to the federal excise tax. The federal courts are in near unanimous agreement that such minimum *229 purchase requirements are dues and membership fees and are subject to the federal tax. The courts found the controlling factor to be that such minimum purchase requirements were shared equally by all club members. As our brethren of the 7th Circuit Court of Appeals have said, "`The [minimum purchase] deposit is a payment required as a condition of continued membership, as a device for imposing on each member a minimum contribution as his share of the operating expense of maintaining a club activity. There was no necessary equivalence between the payment and the benefit received, since this payment had to be made whether or not the member ever availed himself of the use of the club restaurant.'" Freeport Country Club v. United States, 430 F.2d 986, 991 (7th Cir.1970), quoting from Boyden v. United States, 218 F. Supp. 220 (D.Mass.1963); see Wichita Club v. United States, 454 F.2d 135 (5th Cir.1972); Cohen v. United States, 381 F.2d 383, 180 Ct.Cl. 647 (1967); Twinbrook Swimming Pool Corp. v. Comptroller of Treas., Md., 333 A.2d 49 (1975).
We find ourselves in agreement with the almost unanimous expressions of the federal courts as regards that unused portion of the $15 fee paid by members of the Potowomut Golf Club which is not related to purchases of food but is instead assessed equally among all members. We therefore hold that an assessment being shared equally by all members and not levied as a charge in direct proportion to any benefit received is a dues or membership fee and thus not subject to a sales tax under the minimum-charge language of § 44-18-7, subd. D.
We would also add that the club's minimum charge is due regardless of whether or not the member makes any use of the restaurant's facilities. The minimum charge referred to in the statute, however, contemplates that it will be paid only if the patron comes onto the taxpayer's premises and makes some use of the facilities.
The petition for certiorari is granted, the judgment entered in the Superior Court is quashed, and the papers in the case are ordered returned to the Superior Court with our decision endorsed thereon.
NOTES
[1] Act of June 21, 1965, Pub.L.No.89-44, Title III, § 301, 79 Stat. 145. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920016/ | 447 N.W.2d 665 (1989)
Roger Gene VAN HOFF, Applicant-Appellant,
v.
STATE of Iowa, Resister-Appellee.
No. 87-1758.
Court of Appeals of Iowa.
August 23, 1989.
*668 Robert E. Walker, Fort Dodge, for applicant-appellant.
Thomas J. Miller, Atty. Gen., Richard J. Bennett, Asst. Atty. Gen., and James C. Hudson, Pocahontas County Atty., for resister-appellee.
Heard by DONIELSON, P.J., and SCHLEGEL and HAYDEN, JJ.
DONIELSON, Presiding Judge.
Shortly after his live-in girlfriend told him she was moving out, Roger Van Hoff found his shotgun and started firing. Both his father and his son were killed as a result. Van Hoff claims that at the time of the shootings he was depressed, confused, sleep-deprived, and under the influence of alcohol and amphetamines, and that he could not clearly remember what happened until shortly before trial when his memory returned. His attorneys having prepared a defense based on his loss of memory requested a continuance to allow them to develop a new theory based on the return of his memory. The district court denied that motion, and in due course a jury found Van Hoff guilty of two counts of first-degree murder. His conviction was affirmed in State v. Van Hoff, 371 N.W.2d 180 (Iowa App.1985), cert. denied, 474 U.S. 1034, 106 S.Ct. 598, 88 L.Ed.2d 578 (1985). Van Hoff subsequently applied for postconviction relief but it was denied.
Van Hoff's claims of ineffective assistance are grounded in seven allegations: 1) his trial attorneys were rendered ineffective by the trial court's denial of a continuance; 2) his trial attorneys presented no meaningful defense based on intoxication and/or diminished capacity or insanity; 3) his trial attorneys failed to explore the issue of whether the entry by police into Van Hoff's house on the day of the shooting constituted a warrantless search requiring the suppression of the fruits of that search; 4) his trial attorneys failed to challenge the admissibility of statements made by Van Hoff to police officers at the scene of the shootings; 5) his trial attorneys failed to present an adequate argument for the suppression of statements given by Van Hoff at the hospital; 6) his trial attorneys prejudiced his case when they took depositions in his absence and without his having waived his right to be present at this stage of the proceedings; and 7) his trial attorneys failed to challenge the prosecutor's impermissible comments during closing argument that called the jury's attention to Van Hoff's failure to testify.
Van Hoff asserts that his appellate counsel also provided ineffective assistance because of his failure to raise any of these issues on appeal.
Our ultimate concern in claims of ineffective assistance is with the "fundamental fairness of the proceeding whose result is being challenged." State v. Risdal, 404 N.W.2d 130, 131 (Iowa 1987), quoting Strickland v. Washington, 466 U.S. 668, 696, 104 S.Ct. 2052, 2069, 80 L.Ed.2d 674, 699 (1984). We review de novo the totality of the circumstances relating to counsel's conduct, keeping in mind the presumption that counsel performed competently. Risdal, 404 N.W.2d at 131. The burden is on the defendant to prove by a preponderance of the evidence that (1) counsel failed to perform an essential duty and (2) prejudice resulted.
Ordinarily, our review of postconviction relief proceedings is for errors of law. Hinkle v. State, 290 N.W.2d 28, 30 (Iowa 1980). However, when a postconviction petitioner asserts violation of constitutional safeguardssuch as ineffective assistance of counselwe make our own evaluation based on the totality of the circumstances. This is the equivalent of de novo review. Id.
I. Denial of Motion for Continuance. Van Hoff contends that the trial court's denial of his motion for a continuance rendered his trial attorneys constitutionally ineffective in presenting his defense. Specifically, Van Hoff asserts that his trial attorneys could have, and would have, been effective and able to put on a proper defense of intoxication and/or diminished responsibility or insanity if the continuance had been allowed. He also argues that his *669 appellate attorney was constitutionally ineffective in failing to address on appeal the issue of whether or not the denial of Mr. Van Hoff's motion for a continuance was an abuse of the trial court's discretion which denied him effective assistance of counsel.
On Tuesday, August 23, 1983, the day the trial was scheduled to begin, Van Hoff's attorneys sought a continuance of the trial. The attorneys informed the court that the recent return of Van Hoff's memory of the incident necessitated a change in the defense they would pursue. The attorneys argued that additional time was needed to prepare for presentation of the new defense.
The attorneys had originally intended to rely on a defense which was predicated on the basis that Mr. Van Hoff had fallen into a fit of rage or passion, had loaded a weapon, and had indiscriminately began firing it. Their theory of the case was nonintentional, albeit reckless, shooting. According to Van Hoff's attorneys, the night before the trial was to begin he informed them that he recalled shooting his father and son and that he had believed shooting his family was necessary to end his father's pain and to prevent the family from being split up.
A motion for a continuance shall not be granted except upon a showing of good and compelling cause. Iowa R.Crim.P. 8.1. To obtain a continuance, a moving party must make a showing that substantial justice will be more nearly obtained by granting the continuance. State v. Ware, 338 N.W.2d 707, 714 (Iowa 1983). Generally, continuances will not be granted for want of defense preparation in the absence of a showing of good excuse. State v. Youngbear, 229 N.W.2d 728, 733 (Iowa), cert. denied, 423 U.S. 1018, 96 S.Ct. 455, 46 L.Ed.2d 390 (1975). When a defendant claims he needs a continuance for further trial preparation because of some type of surprise or change in circumstances regarding the case, denial of a continuance is proper if the record rebuts the surprise claim. See State v. Slayton, 417 N.W.2d 432, 435 (Iowa 1987). A ruling on a motion for a continuance is a matter committed to the sound discretion of the trial court and will be reversed only when an abuse of discretion is shown. Id. Abuse of discretion is a difficult standard to meet. State v. Halstead, 362 N.W.2d 504, 506 (Iowa 1985).
The record in this case reveals that on the day of the murders, November 5, 1982, Van Hoff made statements in the hospital about discussions he allegedly had with his father about killing the entire family. The fact that Van Hoff on the eve of trial suddenly "recalled" that he had a belief that he needed to kill his entire family to save them from some fate he felt was going to befall them, should not have come as a great surprise to his attorneys in light of those prior statements.
Van Hoff's attorneys sought a court-ordered psychiatric examination. This request was granted and on May 5, 1983, Dr. Taylor examined Van Hoff. On June 22, 1983, Van Hoff's attorneys gave notice of their intent to rely on the defense of insanity and diminished capacity. Yet two months later on August 23rd, Van Hoff's attorneys moved for a continuance so that they might investigate the possibility that at the time of the commission of the crime Van Hoff might have been operating "under a mental disease or defect." It is evident from the record that the attorneys had earlier recognized and considered the possibility of relying on such a defense. Van Hoff's revelations to his attorneys on the eve of trial were not of such a nature that additional time was necessitated to allow them to prepare a defense based on Van Hoff's mental condition.
Similarly, the trial court's denial of a continuance did not render Van Hoff's counsel unable to render a defense based on his intoxication and/or diminished capacity. Evidence regarding Van Hoff's condition on the day of the murder was available long before Van Hoff's memory recall on the eve of trial. Test results showing the alcohol content of his urine sample and statements from hospital and police personnel who dealt with Van Hoff were much more important in preparing a defense based on intoxication and/or diminished capacity *670 than any of the things remembered by Van Hoff and revealed to his attorneys on August 22, 1983. Van Hoff's attorneys were not rendered constitutionally ineffective and unable to develop a defense based on intoxication by the denial of their motion for a continuance.
In sum, the trial court acted within its discretion by denying the motion for a continuance. Van Hoff's attorneys had adequate time to prepare his case and they were allowed sufficient time within which to develop their trial defenses. Likewise, appellate counsel's decision not to appeal the denial of the continuance does not render him constitutionally ineffective.
II. Intoxication/Diminished Capacity Defenses. Van Hoff challenges the postconviction relief court's finding that the trial attorneys were effective in their representation of defendant and fully presented the defense of intoxication and/or diminished capacity or insanity.
Van Hoff's attorneys requested that the jury be instructed on the defenses of insanity and diminished responsibility. The trial court concluded that the evidence presented at trial was not substantial enough to warrant submitting these issues to the jury. The trial court did, however, instruct the jury that the defendant's intoxication could be considered in determining whether the State had proven premeditation, willfulness, deliberation, and specific intent to kill.
A review of the record reveals that the defense did not present any evidence but for the admission of two laboratory reports. One report included the results from a test measuring the alcohol content of Van Hoff's urine on the day of the murders. The other report contained the results of a gunshot residue test performed on Rania Green. A transcript of closing arguments reveals that the defense strategy was to concede that Van Hoff had fired the weapon that killed his son and father but to challenge whether Van Hoff had the requisite intent to commit first-degree murder.
Van Hoff specifically objects to his counsel's failure to put him, lay witnesses, and expert witnesses on the stand to testify with regard to his intoxication and/or diminished capacity or insanity. Counsel's duty to investigate and prepare a defense is not limitless and does not require counsel to pursue each possible witnesses and delve into every line of inquiry. Heaton v. State, 420 N.W.2d 429 (Iowa 1988). The record reveals that while a few witnesses may have been available to testify about Van Hoff's consumption of alcohol or drugs on the day of the murders, there were also a number of witnesses who could have testified that he did not seem intoxicated that day. When counsel makes a reasonable tactical decision, this court will not engage in second-guessing. Fryer v. State, 325 N.W.2d 400, 413 (Iowa 1982). Van Hoff's counsel did not render ineffective assistance with regard to a defense based on intoxication.
Likewise, Van Hoff's counsel did not err in not introducing expert evidence on the issue of Van Hoff's mental condition. A psychiatric examination of Van Hoff had been performed by Dr. Taylor and it was the doctor's conclusion that Van Hoff suffered from no mental disorder other than borderline mental retardation. Van Hoff argues that Dr. Taylor's diagnosis would have differed if information regarding Van Hoff's history as an abused child, of his marital problems, and of his history of alcohol and drug abuse had been conveyed to the doctor. Van Hoff presented no evidence at the postconviction hearing as to the significance of such information. This court cannot find that Van Hoff's attorneys erred in this regard or even that such conduct prejudiced Van Hoff.
Only a defendant can choose whether or not to testify in a criminal case. Schrier v. State, 347 N.W.2d 657 (Iowa 1984). Van Hoff points to nothing in the record which would indicate that his attorneys usurped this decision and denied him his right to testify.
Van Hoff's reliance on Davis v. State of Ala., 596 F.2d 1214 (5th Cir.1979), is misplaced in this case. In Davis, the defendant's attorneys were determined to have *671 rendered ineffective assistance because they failed to investigate potential defenses for the defendant. In Van Hoff's case, his attorneys obtained a psychiatric exam for him and they took numerous depositions before trial. Two months before trial, they had filed their notice of intent to inform the prosecution that they might rely on the defenses of insanity and diminished capacity. Before the State rested its case the defense attorneys indicated that although they had not yet made a firm decision, they might call an expert on the intoxication defense. It is without question that Van Hoff's attorneys were aware of, and had investigated, the various defenses available to him. If they chose to forego these defenses in favor of others, it was undoubtedly due to the strong case the prosecution had established. Van Hoff's attorneys cannot be faulted for relying on the defense strategy which had the most likely chance of being accepted by the jury. The court finds that neither Van Hoff's trial or appellate attorneys were constitutionally ineffective with regard to their presentation of intoxication or diminished capacity defenses.
III. Warrantless Search. Van Hoff argues that his trial and appellate attorneys were constitutionally ineffective for failing to challenge the warrantless search of his home which occurred on November 5, 1982. Warrantless searches and seizures are per se unreasonable unless they come within a recognized exception to the warrant requirement. State v. Holtz, 300 N.W.2d 888, 892 (Iowa 1981). Warrantless searches are per se unreasonable unless one of three exceptions are present: (1) the search is incident to an arrest; (2) the search is consented to; or (3) exigent circumstances require an immediate search. State v. Folkens, 281 N.W.2d 1, 3 (Iowa 1979). The burden is on the State to justify an entry under one of these exceptions. Holtz, 300 N.W.2d at 892.
The record reveals that the search of Van Hoff's home was neither consented to or incidental to his arrest. To be constitutional, the search in this case must have been the result of exigent circumstances. Exigent circumstances sufficient to justify a search and seizure without a warrant usually include danger of violence and injury to the officers or others; risk of the subject's escape; or the probability that, unless taken on the spot, evidence will be concealed or destroyed. State v. Jackson, 210 N.W.2d 537, 540 (Iowa 1973).
Various factors which indicate the existence of exigent circumstances have been set forth[1], however, they are not all-inclusive. Holtz, 300 N.W.2d at 893. The ultimate issue is whether an emergency or urgent need for the warrantless entry existed. Id.
When officers arrived at the scene of the shooting, they found two bodies outside of the house. Van Hoff emerged from the house without the weapon and his arms were raised. Blood was dripping from his cut wrists. Van Hoff told police that no one was left in the house. Van Hoff told officers at the scene that his girlfriend, Rania Green, had done the shooting and had cut him. Rania Green's whereabouts were unknown to police at the scene. It was evident that the police were concerned that the shooter might yet be in the house. Furthermore, one officer at the scene who was familiar with the family was concerned with the whereabouts of Van Hoff's unaccounted-for children. While Van Hoff said no one was in the home, his injured and somewhat emotional state would render his statement to be less than reliable. The officers at the scene conducted a search of the home to ensure that neither the shooter or other victims were inside. The circumstances *672 of this case make this warrantless search constitutional. While Van Hoff is right in that there is no "murder scene" exception to the warrant requirement, Mincey v. Arizona, 437 U.S. 385, 395, 98 S.Ct. 2408, 2415, 57 L.Ed.2d 290, 301-02 (1978), police at a homicide scene "may make a prompt warrantless search of the area to see if there are other victims or if a killer is still on the premises." Id. at 392, 98 S.Ct. at 2413, 57 L.Ed.2d at 300. See also State v. Emerson, 375 N.W.2d 256, 258-59 (Iowa 1985) (citing this Mincey language with approval).
Van Hoff's trial and appellate counsel did not err in failing to challenge the constitutionality of the initial search of his home. It was a search justified by exigent circumstances and Van Hoff's counsel violated no duty in failing to challenge it.
IV. Statements Made at Murder Scene. Van Hoff contends that his trial and appellate counsel were ineffective for failing to challenge the admissibility of statements Van Hoff made at the murder scene. Van Hoff argues that he was in custody at the scene and that the statements were elicited in violation of his constitutional rights because he was not first informed of his rights pursuant to Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966).
It is well established that a defendant who is placed in custody must be given Miranda warnings prior to being interrogated. Miranda v. Arizona, 384 U.S. 436, 86 S.Ct. 1602, 16 L.Ed.2d 694 (1966). Miranda only applies when a defendant is interrogated while in custody. Oregon v. Mathiason, 429 U.S. 492, 495, 97 S.Ct. 711, 714, 50 L.Ed.2d 714, 719 (1977); State v. Cook, 330 N.W.2d 306, 311-13 (Iowa 1983). Custodial interrogation is defined as "questioning initiated by law enforcement officers after a person has been taken into custody or otherwise deprived of his freedom of action in any significant way." Miranda, 384 U.S. at 444, 86 S.Ct. at 1612, 16 L.Ed.2d at 706. Custodial interrogation does not include investigatory questioning without custody, State v. McDonald, 190 N.W.2d 402, 404 (Iowa 1971), basic identification questioning, State v. Beatty, 305 N.W.2d 496, 499 (Iowa 1981), or general on-the-scene questioning. State v. Brown, 176 N.W.2d 180, 182 (Iowa 1970). To determine whether a person is in custody, the relevant inquiry is "how a reasonable man in the suspect's position would have understood his situation." Berkemer v. McCarty, 468 U.S. 420, 442, 104 S.Ct. 3138, 3151, 82 L.Ed.2d 317, 336 (1984). The court must determine whether there was a formal arrest or restraint on freedom of movement of the degree associated with a formal arrest. California v. Beheler, 463 U.S. 1121, 1125, 103 S.Ct. 3517, 3520, 77 L.Ed.2d 1275, 1279 (1983).
The record reveals that when Van Hoff emerged from the house his wrists or arms appeared to be bleeding. When Officer Stowell attempted to bandage the wounds, Van Hoff pulled away and attempted to return to the scene. Van Hoff became quite loud and combative and indicated that he wanted to return to the scene to see his son. Van Hoff's insistence to do so forced the police to physically restrain him. Van Hoff had informed the police that Rania Green had done the shooting and at that time her whereabouts were unknown. Until the house had been searched it was not unreasonable for the police to fear that the shooter may still be in the residence. Van Hoff was restrained, not to be held in "custody," but for his own safety. Much like firefighters physically prevent residents from returning to their burning homes, Van Hoff was similarly constrained for his own safety. Furthermore, the officers had an interest in preventing anyone, including Van Hoff, from entering the crime scene and risking the possible destruction of evidence.
Nothing in the record indicates that Van Hoff would not have been allowed to leave the area as long as he was not trying to return to the crime scene. A reasonable person in Van Hoff's place would have believed that he was being prevented from returning to the crime scene, but would not have concluded that he was in the custody of the police. This is further evidenced by the fact that no officer accompanied Van *673 Hoff when he was transported to the hospital. Any statements elicited from Van Hoff at this time were the result of general on-the-scene questioning and were not the product of custodial interrogation.
Van Hoff's trial and appellate counsel did not err in failing to challenge the custodial nature of his restraint at the scene and the admissibility of statements that resulted therefrom. Counsel did not fail to perform an essential duty in this case.
V. Suppression of Statement Given at Hospital. Van Hoff asserts that the postconviction relief trial court erred in finding that his trial attorneys adequately presented evidence in support of suppression of statements he made at the hospital. In addition, he argues that his appellate attorney was constitutionally ineffective for failing to present this issue on appeal.
Mr. Van Hoff entered the hospital at 4:23 p.m. At approximately 5:30 p.m., a police officer was sent to the hospital to watch over him. After Mr. Van Hoff was admitted to a hospital room, at approximately 6:00 p.m., his Miranda rights were read to him and the sheriff began interrogating him.
Van Hoff sets forth several factors and alleges that they demonstrate that he did not make a knowing, intelligent, and voluntary waiver of his rights as required under Miranda. Van Hoff relies on the following in support of his argument:
1) the hot temperature of the hospital room in which he was questioned;
2) his confusion and incoherence during the questioning;
3) his request for "help" during the questioning;
4) his low intelligence;
5) his consumption of alcohol on the day of the shootings;
6) his use of marijuana and amphetamines on the day of the shootings;
7) his lack of sleep;
8) that he was overborne by the interrogating officer due to his condition; and
9) that the interrogating officer and Van Hoff knew each other and the officer used this relationship to elicit statements from Van Hoff.
The test for determining the admissibility of inculpatory statements is voluntariness. State v. Munro, 295 N.W.2d 437, 440 (Iowa 1980). Courts examine the totality of the circumstances to determine the voluntariness of statements. Id. The State must prove by a preponderance of evidence that such statements were voluntarily made. State v. Jacoby, 260 N.W.2d 828, 832 (Iowa 1977). This burden is heavy when a defendant is not represented by counsel in a custodial interrogation. Id.
Intoxication renders a statement inadmissible when the intoxication reaches the extent of incoherence or mania. State v. Youngbear, 229 N.W.2d 728, 736 (Iowa), cert. denied, 423 U.S. 1018, 96 S.Ct. 455, 46 L.Ed.2d 390 (1975). Testimony from the police officers and hospital personnel reveals that Van Hoff did not appear drunk or incoherent despite his blood alcohol content of .14 percent.
Mental subnormality does not in itself prevent statements from being voluntary unless it is sufficient to deprive the person involved of capacity to understand their meaning and effect. State v. Conner, 241 N.W.2d 447, 454 (Iowa 1976). Deficiencies like low intelligence are simply part of the totality of circumstances which must be considered in determining the voluntariness issue.
Van Hoff appears to be arguing that his requests for "help" in the interrogation were a request for counsel and that subsequent statements should not have been admissible at trial. The pertinent language from the interrogation is as follows:
OFFICER: Now you tell us the truth and lets stick to the story and we'll have it down.
VAN HOFF: I tell you the truth and you guys will try and help me right.
OFFICER: We'll do what we have too, Rog, if it means help, ah, thats what it will be.
VAN HOFF: I'll tell you the truth, I think I do need some help.
*674 OFFICER: You do need some help. OK, let's go back to the beginning.
Van Hoff's request for help was directed to the officers"you guys will try and help me right." His statements evince an interest in cooperating with the officers so that they will help him out.[2] His statements were not a request for counsel.
Van Hoff's allegation that he was overborne by the interrogating officer and that the officer inappropriately used the fact that he knew Van Hoff to elicit statements is without merit. The record reveals that the officers engaged in persistent and thorough interrogation; it does not reveal that Van Hoff's will was in any way overborne by the officer. Van Hoff offers only the allegation and no substantiation as to why the fact that an interrogating officer knew him would affect the voluntariness of his decision.
Many of the factors relied on by Van Hoff as evidence of his nonvoluntariness were countered by evidence which sustained the conclusion that he was coherent and not confused when he made his statements. Upon review of the totality of the circumstances, this court concludes that Van Hoff's counsel did not fail to perform an essential duty with regard to suppression of his statements made in the hospital. His trial counsel did an effective job in arguing to suppress the statements. Van Hoff's appellate counsel did not err in choosing not to appeal the issue.
VI. Confrontation of Witnesses. Van Hoff contends that his attorneys prejudiced his case and violated his constitutional right to confront witnesses by not ensuring his presence at the taking of depositions. The record reveals that thirty depositions were taken by Van Hoff's counsel. None of the depositions were used at trial other than for impeachment purposes.
A criminal defendant is to be present at every stage of the trial. Iowa R.Crim.P. 25. The Iowa Supreme Court has determined that a "stage of the trial" includes all pretrial proceedings where fact issues are presented or when their dispositions will be significantly aided by the defendant's presence. State v. Foster, 318 N.W.2d 176, 179 (Iowa 1982). Van Hoff relies on State v. Turner, 345 N.W.2d 552, 559 (Iowa App.1983), for the view that the taking of depositions is a stage of the trial. While this court did hold in Turner that the taking of a deposition, where testimony is taken for introduction at trial, is a "stage of trial" at which the defendant has a right to be present, id., the factual setting in Turner involved a deposition that was specifically taken to perpetrate testimony and to be introduced at trial. The witness in Turner was in the military and would not be present for the trial. The record in Turner did not disclose that the defendant was ever given the opportunity to be present for the deposition. Clearly the defendant in that case was denied the opportunity to confront the witness.
A recent decision of the Iowa Supreme Court concluded that a discovery deposition not taken for use at trial is not a "stage of trial." Otteson v. Iowa District Court, 443 N.W.2d 726, 728 (Iowa 1989). In the case now before this court, the depositions were taken as discovery depositions and not to perpetrate the testimony of one who would be absent from the trial. None of the depositions in this case were introduced into evidence at the trial. One of the more important purposes of Iowa Rule of Criminal Procedure 25(1) is to protect the defendant's constitutional right of confrontation in presenting evidence from which the trier of fact determines guilt. Id. See State v. Yaw, 398 N.W.2d 803, 808 (Iowa 1987) (defense attorney's stipulation to admission of deposition wasn't barred because defendant had had opportunity to attend deposition and confront accusers and had voluntarily chosen not to do so).
In a recent decision, the United States Supreme Court also emphasized that the key aspect of the Confrontation Clause is the opportunity for effective cross-examination. Kentucky v. Stincer, 482 U.S. 730, *675 739, 107 S.Ct. 2658, 2664, 96 L.Ed.2d 631, 642 (1987) (defendant's absence from competency hearing for witness did not violate confrontation clause).
Van Hoff's absence from the depositions does not constitute the failure to perform an essential duty by his counsel.
VII. Prosecutor's Closing Argument. Van Hoff asserts that all of his prior attorneys failed to challenge the prosecutor's comments during closing arguments that allegedly called the jury's attention to Van Hoff's failure to testify. The statement of the prosecutor is as follows with the specifically-challenged language underscored:
Now a great deal of what was brought into this courtroom wasn't contradicted. A great deal of what was told to you as jurors, I think, you will probably agree has been proven without any doubt left, and I will talk to you a little bit about that proving without a doubt or beyond a reasonable doubt standard, but the State has that obligation when there is a plea of not guilty. In essence, the defendant is saying to the State, "Prove it to a jury."
That is why we are here.
You saw a lot of witnesses come through this courtroom that to you as jurors on this case you thought well, you know there really isn't much question about that or you have heard two or three or maybe even more witnesses discuss the same thing, the exact same thing, and you thought, well, you know there is no doubt about that. We believed the first witness and the second witness and third, but it is still necessary for the State to prove the case, and that is what I have been doing here for the past week, is proving the case, and to do that, it is necessary for us to call these witnesses to present this evidence.
Generally, a prosecutor may not comment on an accused's failure to testify. Schertz v. State, 380 N.W.2d 404, 410 (Iowa 1985). Comments which draw inferences of guilt from a defendant's failure to testify violate the self-incrimination clause of the fifth amendment and constitute reversible error. State v. Kimball, 176 N.W.2d 864, 868 (Iowa 1970). An overt statement is not required, State v. Nelson, 234 N.W.2d 368, 371 (Iowa 1975), both direct and indirect comments on the accused's silence are prohibited. State v. Bishop, 387 N.W.2d 554, 562 (Iowa 1986).
Whether a statement constitutes an improper reference on a defendant's silence at trial depends on whether (1) the prosecutor manifestly intended to refer to the defendant's failure to testify, or (2) the jury would naturally and necessarily interpret the statement to be a reference to the defendant's silence. Bishop, 387 N.W.2d at 563. The court will not find that the prosecutor manifestly intended to comment on a defendant's right to remain silent when an equally plausible explanation exists for his or her statement. Id. A prosecutor's statements are not viewed in isolation, but in the context they were made. Id. See Lockett v. Ohio, 438 U.S. 586, 595, 98 S.Ct. 2954, 2959-60, 57 L.Ed.2d 973, 983 (1978) (The court looked at the context of the trial and found that the prosecutor's references to the State's unrefuted and uncontradicted evidence did not violate constitutional prohibitions.).
The context of the prosecutor's statement suggests that it was made in connection with his observation that the State had presented numerous and repetitive witnesses and a great deal of evidence to prove its case. References to the weight and credible nature of evidence are not prohibited, and the context of the prosecutor's statement assures this court that he did not manifestly intend to refer to the defendant's silence. Likewise, the context of the statement convinces this court that it was not of such a nature that a jury would naturally and necessarily interpret the statement to be a reference to the defendant's silence.
The prosecutor's statement was not improper and Van Hoff's counsel did not err in not objecting to it and in not challenging it on appeal.
AFFIRMED.
NOTES
[1] (1) a grave offense is involved;
(2) the suspect is reasonably believed to be armed;
(3) there is probable cause to believe the suspect committed the crime;
(4) there is strong reason to believe he is on the premises;
(5) there is a strong likelihood of escape if not apprehended; and
(6) the entry, though not consented to, is peaceable.
Holtz, 300 N.W.2d at 893.
[2] The trial court correctly found that no offers of leniency or preferential treatment were extended to Van Hoff from the officers. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920054/ | 91 B.R. 893 (1988)
In re David Wayne OSINGA, Beverly Sue Osinga, Debtors.
Robert S.N. TENORIO, Maria Q. Tenorio, Appellants,
v.
David Wayne OSINGA, Beverly S. Osinga, Appellees.
BAP No. CC-87-1067 VMoMe, Bankruptcy No. SA 83-01977RP, Adv. No. SA 83-2932.
United States Bankruptcy Appellate Panel of the Ninth Circuit.
Argued and Submitted July 20, 1988.
Decided September 7, 1988.
John A. Belcher, Herramann, Potter & Taylor, San Diego, Cal., for appellants.
Andrew K. Phelps, Law Offices of Robert L. Goodrich, San Bernardino, Cal., for appellees.
Before VOLINN, MOOREMAN and MEYERS, Bankruptcy Judges.
OPINION
VOLINN, Bankruptcy Judge:
Robert and Maria Tenorio, husband and wife, creditors and plaintiffs below, are appellants herein. They appeal from an order of the bankruptcy judge dismissing their Complaint to Determine Dischargeability of Debt for want of prosecution and an order denying their motion for reconsideration of this matter. David and Beverly *894 Osinga, debtors and defendants below, are appellees herein.
We affirm.
FACTS
The Osingas filed a Chapter 13 petition in bankruptcy on April 26, 1983. This was later converted to a Chapter 7, and an order for relief under Chapter 7 was entered on July 11, 1983. On September 19, 1983, Robert and Maria Tenorio, who had loaned the debtors $15,000.00, filed their Complaint to Determine Dischargeability of Debt. This was the last day on which they could timely do so. The Osingas timely answered.
The matter was set for trial November 16, 1983. The trial date was vacated and the matter set for status conference on January 13, 1984. The record, which does not reflect why the trial date was vacated, simply refers to the filing of the "Notice of Vacating Trial Date and of Status Conference." The Tenorios filed a pretrial statement on or about May 10, 1984. The matter was then set for trial on May 18, 1984. The court vacated the trial date and set the matter for status conference on May 10, 1984. Again, the record does not reflect why the trial date was vacated. Regarding this matter, the record contains: (1) an "Order Vacating Hearing Date and Setting Status Conference" signed by Bankruptcy Judge Ralph G. Pagter and dated April 18, 1984; (2) Minutes of the Bankruptcy Court, reflecting that both sides appeared for a status conference at 10:00 a.m. on May 10, 1984, and the matter was continued to July 6, 1984. While the record does not reflect who requested continuance of the status conference, appellants' opening brief states that appellees requested such continuance. Appellees do not dispute this statement.
On or about May 22, 1984, the Tenorios substituted counsel, and the Osingas were so informed on or about June 1, 1984. By agreement, the parties took depositions on June 18, 1984, nine months after the Complaint had been filed, and took the July 6 status conference off calendar.
On November 17, 1986, the court dismissed the case for want of prosecution. The court's docket reflected no activity since July 6, 1984. Counsel for the Tenorios moved for reconsideration of this ruling (the motion was filed December 8, 1986). The motion was briefed by both sides, and was heard and denied on January 5, 1987. The Tenorios timely appealed.
ISSUE
Did the trial court abuse its discretion in dismissing the case for want of prosecution?
STANDARD OF REVIEW
The court had inherent authority to sua sponte dismiss the case for want of prosecution. Henderson v. Duncan, 779 F.2d 1421 (9th Cir.1986).
A trial court is required to consider the following five factors in determining whether to dismiss an action for lack of prosecution: (1) the public's interest in expeditious resolutions of litigation, (2) the court's need to manage its docket, (3) the risk of prejudice to defendants, (4) the public policy favoring disposition of cases on their merits, and (5) the availability of less drastic sanctions. Henderson v. Duncan, 779 F.2d at 1423; Ash v. Cvetkov, 739 F.2d 493, 496 (9th Cir.1984); In re Stuart, 88 B.R. 247 (9th Cir. BAP 1988). When, as here, the trial court does not explicitly consider these five factors, the appellate court reviews the record independently to determine whether there was an abuse of discretion. Malone v. United States Postal Service, 833 F.2d 128, 130 (9th Cir.1987); Henderson, 779 F.2d at 1424; Ash, 739 F.2d at 496. The trial court will be reversed only if the appellate court is convinced that a mistake was made. Nealey v. Transportacion Maritima Mexicana, S.A., 662 F.2d 1275 (9th Cir.1980); Henderson, 779 F.2d at 1424.
ANALYSIS
Appellants concede that the trial court is to be reversed only for abuse of discretion. They present three arguments that the trial court abused its discretion in dismissing the case: (1) the appellees have shown no *895 prejudice resulting from the delay, (2) the court should have imposed a less harsh penalty, and (3) the delay was caused by counsel rather than the appellants themselves.
We rule against appellants on these three arguments.
I. Dismissal Factors
A. The first two factors
The appellate court gives deference to the trial court in the area of determining whether dismissal for lack of prosecution is supported by a showing of unreasonable delay, since the trial court is in the best position to determine what period of delay can be endured before its docket becomes unmanageable. Henderson v. Duncan, 779 F.2d at 1423.
In this case, the twenty-nine-month delay impeded the expeditious resolution of the case and hindered the trial court in managing its docket. See Malone v. U.S. Postal Service, 833 F.2d at 131; Ash, 739 F.2d at 496.
B. Prejudice to the defendant
The law presumes injury to the defendant from unreasonable delay.
The fact that defendants neither sought dismissal for lack of prosecution nor made a showing of prejudice does not require reversal of an order dismissing for lack of prosecution. Pearson v. Dennison, 353 F.2d 24 (9th Cir.1965).
In determining whether a defendant has been prejudiced, an appellate court is to consider whether plaintiff's actions impair the defendant's ability to go to trial or threaten the rightful decision of the case. Malone, 833 F.2d at 131. In this case, defendants/appellees had seen no action and had heard nothing from the plaintiffs/appellants regarding this matter for twenty-nine months. In light of the fact that witnesses move away and their memories fade, injury to the defendants is rightfully presumed. Alexander v. Pacific Maritime Association, 434 F.2d 281 (9th Cir.1970) (presumption of injury to defendants when plaintiff caused nine-month delay); Hicks v. Bekins Moving & Storage Co., 115 F.2d 406 (9th Cir.1940) (Defendants were not required to show specific impairment of their defense in order to justify the court's dismissal on its own motion of an action which had been called for assignment sixteen times in a period of twenty months before being set for dismissal, since the law will presume injury from unreasonable delay). We note that debtors have recourse to bankruptcy so that they may have the benefit of immediate relief from oppressive economic circumstances and a fresh start. Parties seeking to except their debts from the operation of a discharge should litigate their claims with reasonable promptitude. Here, appellants' two and one half years of inaction impaired or prejudiced the debtors' fresh start.
C. Consideration of Less Drastic Alternatives
Although the Ninth Circuit Court of Appeals has indicated a preference for explicit discussion by the trial court of the feasibility of lesser sanctions when ordering dismissal, it has never ruled that explicit discussion of alternatives is necessary for an order of dismissal to be upheld. Malone, 833 F.2d at 132. Under egregious circumstances, it is unnecessary (although helpful) for a trial court to discuss why alternatives to dismissal are infeasible. Malone, 833 F.2d at 132.
In affirming a dismissal, without prior warning, for failure of counsel to appear at a pretrial conference, the United States Supreme Court said:
Nor does the absence of notice as to the possibility of dismissal or the failure to hold an adversary hearing necessarily render such a dismissal void. It is true, of course, that "the fundamental requirement of due process is an opportunity to be heard upon such notice and proceedings as are adequate to safeguard the right for which the constitutional protection is invoked." Anderson National Bank v. Luckett, 321 U.S. 233, 246, [64 S.Ct. 599, 606, 88 L.Ed. 692 (1944) ]. But this does not mean that every order entered without notice and a preliminary adversary hearing offends due process. *896 The adequacy of notice and hearing respecting proceedings that may affect a party's rights turns, to a considerable extent, on the knowledge which the circumstances show such party may be taken to have of the consequences of his own conduct. The circumstances here were such as to dispense with the necessity for advance notice and hearing.
Link v. Wabash R.R. Co., 370 U.S. 626, 632, 82 S.Ct. 1386 at 1389, 8 L.Ed.2d 734 (1962).
In this case, the 29-month delay was egregious. No discussion of alternatives nor prior warning was necessary.
II. It was the duty of the appellants as plaintiffs below, rather than of the appellees as defendants below, or the court, to expedite the case to final determination.
The duty rests upon the plaintiff at every stage of the proceeding to use diligence and to expedite his case to a final determination, and unless it is made to appear that there has been a gross abuse of discretion on the part of the trial court in dismissing an action for lack of prosecution its decision will not be disturbed on appeal.
Hicks v. Bekins Moving & Storage Co., 115 F.2d at 409 (9th Cir.1940), quoting Inderbitzen v. Lane Hospital, 17 Cal.App.2d 103, 61 P.2d 514 (1936).
"It is a well established rule that the duty to move a case is on the plaintiff and not on the defendant or the court." Fidelity Philadelphia Trust Company v. Pioche Mines Consolidated, Inc., 587 F.2d 27, 29 (9th Cir.1978), (Citations omitted), (affirming dismissal of counterclaim when defendants (counterclaimants) did not show diligence in prosecuting it).
It is the plaintiff's duty to expedite his case to its final determination, and if he allows delays by the defendant, he cannot complain of them. Boudreau v. United States, 250 F.2d 209, 211 (9th Cir.1957) (court held that plaintiff could not complain of defendant's one-year delay in filing answer when plaintiff allowed delay).
In this case, plaintiffs/appellants complain that they were ready to go to trial on three occasions, and delays were caused by the defendants/appellees. The record, however, does not reflect what caused the delays. When the trial court reviewed the file, it saw that two trial dates had been vacated, the case had been set for status conference, taken off calendar, and thereafter nothing occurred for twenty-nine months. This record demonstrates per se a lack of prosecution. In any event, assuming arguendo that the delay was contributed to or caused by appellees, dismissal may nevertheless be appropriate. Accord, Thompson v. Housing Authority of the City of Los Angeles, 782 F.2d 829 (9th Cir.1986) (affirmance of dismissal after several continuances).
III. That counsel may have been more at fault than was his client is not grounds for reversal in this case.
For purposes of a motion to dismiss for failure to prosecute, the plaintiff has the ultimate burden of persuasion both as to excuse for his own delay and as to lack of prejudice to the defendant. The trial court is to determine whether there has been sufficient unjustified delay to warrant dismissal of the plaintiff's case. Nealey, 662 F.2d 1275, 1279-81; Franklin v. Murphy, 745 F.2d 1221, 1233 (9th Cir.1984).
In this case, the plaintiffs/appellants have offered as an excuse for their twenty-nine-month delay that counsel forgot to file an at-issue memorandum. This memorandum was apparently required by local court rule, although neither the record nor the briefs make that completely clear. In their Opening Brief, appellants state:
Plaintiffs and defendants both took depositions on June 18, 1984, by stipulation. The transcripts not having been created, the attorneys agreed that the status conference could go off calendar, the court by then having adopted the use of an "at-issue memorandum" to control trial settings.
In his declaration supporting the motion for reconsideration, attorney for appellants, states:
*897 Plaintiff and defendants both took depositions on June 18, 1984, in my offices. After the conclusion of the depositions, we engaged in some unsuccessful settlement negotiations. I instructed my secretary to file an at-issue memorandum. I assumed it had been done and that I was awaiting a trial date. During the time since then, I have received no communication of any kind from the adverse parties or their counsel.
From this statement appellants argue that, since delay was caused by counsel, rather than his clients, clients should not be punished. Appellants rely on Pond v. Braniff Airways, Inc., 453 F.2d 347 (5th Cir.1972) to support this position. However, Pond is distinguishable from this case. In Pond, plaintiff's counsel appeared for trial in a timely fashion without having filed a proposed pretrial order and jury instructions. The trial court dismissed the case without prejudice. The Fifth Circuit held that this was too severe a sanction, in light of the fact that counsel's oversights were merely inadvertent.
Appellants also rely on Sykes v. United States, 290 F.2d 555 (9th Cir.1961). There the Ninth Circuit reversed the trial court's dismissal, partly because it was counsel's rather than the client's fault, but largely because less than a seven-month delay had occurred. Sykes is distinguishable from this case in which a twenty-nine-month delay occurred, during which time plaintiffs should have and could have insisted that their lawyers take some action or that new counsel be substituted.
CONCLUSION
Dismissal, given justifiable circumstances, is appropriate. Link v. Wabash R.R. Co., 370 U.S. 626, 633, 82 S.Ct. 1386, 1390, 8 L.Ed.2d 734 (1962) (United States Supreme Court affirmed dismissal for counsel's unexcused failure to appear at pretrial conference, reasoning that since petitioner freely chose counsel, petitioner could not avoid the consequences of counsel's acts or omissions); Henderson v. Duncan, 779 F.2d at 1424 (not error to dismiss case for counsel's failure to comply with pretrial order).
We cannot conclude, on the basis of the record before us, that the trial judge abused his discretion. Accord, States S.S. Co. v. Philippine Air Lines, 426 F.2d 803 (9th Cir.1970) (dismissal affirmed when plaintiff took no action for thirteen months); Fitzsimmons v. Gilpin, 368 F.2d 561 (9th Cir.1966) (dismissal affirmed when plaintiff took no action for fifteen months); Von Poppenheim v. Portland Boxing & Wrestling Comm'n, 442 F.2d 1047 (9th Cir. 1971) (dismissal affirmed when plaintiff did not comply within eleven months with court order to specify claim more specifically and list witnesses who would testify at trial); Ballew v. Southern Pac. Co., 428 F.2d 787 (9th Cir.1970) (dismissal affirmed where counsel had taken no action to obtain disclosure of allegedly inaccessible factual data in one and a half year period since filing).
We therefore affirm. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920059/ | 91 B.R. 904 (1988)
In re Loretta Q. NELSON, Debtor.
Stephen C. BECKER, Trustee in Bankruptcy, Plaintiff-Appellant,
v.
The COUNTY OF SANTA CLARA, a political subdivision of the State of California, and Jack Huber, individually and dba Century Medallion Realtors, Defendants-Appellees.
No. C-88-0424 EFL, Bankruptcy No. 4-87-03164WB-3, Adv. No. 3-87-0493 LK (OAK).
United States District Court, N.D. California.
October 18, 1988.
Steven Becker, San Francisco, Cal., for plaintiff-appellant.
Duane W. Shewaga, Adleson, Hess, Christensen & Kelly, San Jose, Cal., for Century Medallion.
Susan Branch, San Jose, Cal., for Santa Clara County.
ORDER
LYNCH, District Judge.
This is an appeal from the bankruptcy court's dismissal for failure to state a claim of the trustee in bankruptcy's complaint seeking to set aside and avoid as a preferential transfer a restitution payment made by the debtor in bankruptcy to defendant county pursuant to a state criminal conviction. For the reasons discussed below, the Court affirms.
According to the trustee's complaint, the debtor is subject to a state criminal judgment of conviction that requires the debtor to make periodic restitution payments to the county for the benefit of a victim of her crime, defendant Huber. The trustee asserts that the debtor made a restitution payment of $4,000 to the county within the 90-day period prior to the filing of her bankruptcy. Pursuant to 11 U.S.C. § 547,[1] the trustee seeks to recover that sum from *905 the county or from Huber, to whom the county allegedly may have already forwarded the payment.
Plaintiff relies chiefly on Superior Court v. Heincy, 78 B.R. 246 (Bankr. 9th Cir.1987), in which a majority of a Bankruptcy Appellate Panel of the Ninth Circuit, based on a technical reading of the Bankruptcy Code, held that a restitution obligation arising from a state criminal conviction was a "debt" within the meaning of section 101(11) that was properly dischargeable in Chapter 13 bankruptcy proceedings. The majority therefore affirmed the bankruptcy court's order enjoining the state criminal court from enforcing the collection of restitution payments. In a sharp and compelling dissent, Bankruptcy Judge Volinn argued that the majority's literal approach to interpreting the Bankruptcy Code was contrary to the Supreme Court's rationale in Kelly v. Robinson, 479 U.S. 36, 107 S.Ct. 353, 93 L.Ed.2d 216 (1986), in particular because it ignored the Kelly Court's concern for overriding principles of federalism.[2]
Whatever the correctness of the Heincy majority's result, as plaintiff essentially concedes this Court is of course not bound by any Bankruptcy Appellate Panel decision, much less one concerning a case from another district. See, e.g., 28 U.S.C. § 158; Starbuck v. San Francisco, 556 F.2d 450, 457 n. 13 (9th Cir.1977). Moreover, even if Heincy's reasoning were correct or binding on the Court, it would not be dispositive here. As both the Heincy majority and dissent recognized, Heincy was based on the majority's belief that interpretation under Chapter 13 should be different from that under Chapter 7, and that therefore the Supreme Court's reasoning in the Chapter 7 case Kelly was not controlling. Heincy, 78 B.R. at 246, 249 (majority opinion), 249-51 (dissenting opinion). Like Kelly, however, the case at bar concerns Chapter 7 proceedings, and therefore Kelly unquestionably is applicable in this case.
In Kelly, the Supreme Court found that restitution obligations were not subject to discharge in Chapter 7 proceedings. The trustee therefore must argue that even though restitution is not dischargeable in this bankruptcy, it nevertheless is avoidable. Like the Heincy majority, the trustee bases his argument on the plain meaning of the language in the Bankruptcy Code and contends that a restitution obligation is a debt pursuant to section 101(11), that a debt is avoidable as a preference under section 547, and therefore that the restitution payment at issue is avoidable and that he has stated a claim.
In reversing the Second Circuit's similar plain meaning analysis, the Supreme Court in Kelly made it abundantly clear that the Bankruptcy Code must be interpreted "in light of the history of bankruptcy court deference to criminal judgments and in light of the interests of the States in unfettered administration of their criminal justice systems." Kelly, 479 U.S. at 44, 107 S.Ct. at 358. The Court determined that absent a specific expression of intent by Congress to overturn the "established judicial exception to discharge" the exception should remain valid. Id. at 46, 107 S.Ct. at 359. The Court further found that:
[I]nterpretation of the Code also must reflect the basis for this judicial exception, a deep conviction that federal bankruptcy courts should not invalidate the *906 results of state criminal proceedings. The right to formulate and enforce penal sanctions is an important aspect of the sovereignty retained by the States. This Court has emphasized repeatedly "the fundamental policy against federal interference with state criminal prosecutions."
Id. at 47, 107 S.Ct. at 360 (quoting Younger v. Harris, 401 U.S. 37, 46, 91 S.Ct. 746, 751, 27 L.Ed.2d 669 (1971)). The Court accordingly rejected a literal approach to statutory construction of the Code with respect to restitution. The Court criticized the imposition of any requirement that the state object in order to prevent discharge of restitution, finding that forcing the state so to protect its restitution orders via sections 523(a)(2) and (a)(4) "would create uncertainties and impose undue burdens on state officials." Id. at 48, 105 S.Ct. at 360. The Court noted that mechanical analysis of the Code could result in "federal remission of judgments imposed by state criminal judges," a prospect the Court believed abhorrent particularly because it:
would hamper the flexibility of state criminal judges in choosing the combination of imprisonment, fines, and restitution most likely to further the rehabilitative and deterrent goals of state criminal justice systems.
Id. at 49, 105 S.Ct. at 360 (footnote omitted).
Although expressly voicing its "serious doubts" that restitution is a debt within the meaning of the Code, the Court found it unnecessary to decide this question. Id. at 50, 105 S.Ct. at 361. Instead, Kelly based its holding on an interpretation of section 523(a)(7), which the Court read very liberally to preserve from discharge restitution exactly equal to the amount of the victim's loss, see Kelly, 479 U.S. at 38-39 & n. 2, 105 S.Ct. at 355-56 & n. 2, even though on its face the restitution hardly seemed to satisfy the section's explicit requirement that it "`not [be] compensation for actual pecuniary loss,'" Id. at 50-53, 105 S.Ct. at 361-62 (quoting 11 U.S.C. § 523(a)(7)). Here, defendants have not argued that there is any provision comparable to section 523 to preserve restitution from avoidance.[3] The Court therefore cannot refrain from going on to consider whether restitution is a debt or whether, even if so, restitution nevertheless may not be avoided.
The Court believes that a fair reading of Kelly leaves little doubt about the proper outcome in this appeal. While an historical exception to avoidance of restitution does not appear to be as clearly established as the exception for discharge of restitution, this Court finds that the reasons for an exception are similarly compelling.
Here as in Kelly, Congress has given no clear signal to indicate that this Court should construe the Bankruptcy Code to require the anomalous result that restitution should be avoidable. Kelly therefore mandates that the Code should be liberally construed to minimize federal interference with the state criminal justice system. If anything, avoidance of restitution obligations is seemingly even more intrusive and disruptive of the state's criminal justice system than discharge of restitution. Far beyond merely extinguishing a debt that ought to be paid in the future, the trustee seeks to recover restitution that has been paid; plaintiff attempts to reach into the coffers of the county that convicted the debtor of her crime, and even into the pockets of the individual victim of her theft. Plaintiff's claim would thus turn the state's criminal justice system on its head in a federal bankruptcy proceeding: the state and the crime victim are the defendants, the criminal is the complainant. There can be no doubt that such an ironic and unseemly specter would impose undue burdens and uncertainties on the state (not to mention the victim), would lead to federal remission of state criminal judgments, and would hamper the sentencing decisions of state judges. To paraphrase what the Supreme Court described as the "leading case":
*907 "It might be admitted that section [547] of the [B]ankrupt[cy Code], if only the letter of those provisions be looked to, would embrace [criminal restitution]; but it is well settled that there may be cases in which such literal construction is not admissible. . . . It may suffice to say that nothing but a ruling from a higher court would convince [this Court] that [C]ongress, by any provision of the [Code], intended to permit the [avoidance], under its operations, of any judgment rendered by a state or federal court imposing [restitution] in the enforcement of criminal laws. . . . "
See Kelly, 479 U.S. at 45, 105 S.Ct. at 358 (approvingly quoting In re Moore, 111 F.145, 149 (W.D.Ky.1901)) (ellipses in original). Compare generally, e.g., United States v. Caddell, 830 F.2d 36 (5th Cir. 1987); Davenport v. Pennsylvania Dept. of Pub. Welfare, 89 B.R. 428 (E.D.Pa.1988) (reversing 83 B.R. 309 (Bankr.E.D.Pa. 1988)); Kohr v. Magisterial Dist. of Lebanon County, 82 B.R. 706 (Bankr.M.D.Pa. 1988); Pennslyvania Dept. of Pub. Welfare v. Oslager, 46 B.R. 58 (Bankr.M.D.Pa. 1985); Black Hawk County v. Vik, 45 B.R. 64 (Bankr.N.D. Iowa 1984); Pellegrino v. Connecticut Div. of Criminal Justice, 42 B.R. 129 (Bankr.D.Conn.1984); Arizona v. Magnifico, 21 B.R. 800 (Bankr.D.Ariz. 1982); In re Button, 8 B.R. 692 (Bankr.W. D.N.Y.1981), later proceeding, Button v. Sheridan Oil Co., 18 B.R. 171 (Bankr.W.D. N.Y.1982); People v. Calhoun, 145 Cal. App.3d 568, 193 Cal.Rptr. 394 (1983); People v. Washburn, 97 Cal.App.3d 621, 158 Cal.Rptr. 822 (1979) with, e.g., Becker v. County of Sacramento (In re Hackney), 83 B.R. 20 (Bankr.N.D.Cal.1988); People v. Taite, 76 B.R. 764 (Bankr.C.D.Cal.1987); Rajala v. Bowlus School Supply, Inc. (In re Kirk), 38 B.R. 257 (Bankr.D.Kan.1984); Blast v. Atlantic National Bank (In re Kayajanian), 27 B.R. 711 (Bankr.S.D.Fla. 1983).
Accordingly, the Court concludes that, regardless of whether restitution should be analyzed as a debt, criminal restitution is excepted from avoidance under section 547. The trustee in bankruptcy has therefore failed to state a claim, and the decision of Chief Bankruptcy Judge King is affirmed.
IT IS SO ORDERED.
NOTES
[1] Unless otherwise indicated, all statutory references are to Title 11 of the United States Code (the "Bankruptcy Code" or "Code").
[2] Subsequent to submission of the appeal at bar, the Ninth Circuit very recently reversed Heincy on the grounds that injunctive relief was inappropriate because there were adequate legal remedies such as the potential modification of the Chapter 13 payment plan. See Superior Court v. Heincy, 858 F.2d 548 (9th Cir.1988). In addition, because it was not known whether the debtors had successfully completed payments under the Chapter 13 plan, the circuit found that the issue of dischargeability of the restitution was not ripe. Although stating that it was "revers[ing]" the Bankruptcy Appellate Panel's ruling on this issue, the circuit should be understood to have effectively vacated rather than changed to the contrary the ruling, because the court expressly recognized that the issue is an open one and declined to decide it. Id. at 550. In doing so, the circuit noted that in light of Kelly "there is considerable doubt whether the restitution order would be dischargeable." Heincy, at 550. Given the posture of the appeal at bar, it therefore remains necessary to address plaintiff's argument based on the Heincy Bankruptcy Appellate Panel's reasoning.
[3] The Court therefore does not have before it and does not reach any such argument that might be advanced. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/96254/ | 197 U.S. 343 (1905)
McMILLEN
v.
FERRUM MINING COMPANY.
No. 185.
Supreme Court of United States.
Argued March 15, 16, 1905.
Decided April 3, 1905.
ERROR TO THE SUPREME COURT OF THE STATE OF COLORADO.
*344 Mr. George R. Elder for plaintiffs in error.
Mr. Charles Cavender, with whom Mr. John A. Ewing was on the brief, for defendant in error.
*345 MR. JUSTICE BROWN, after making the foregoing statement, delivered the opinion of the court.
In their amended complaint the plaintiffs averred that in the location and record of the Eulalia lode mining claim their grantor had complied with the laws of the United States, the laws of Colorado and the rules and regulations of miners in the district, with reference to the discovery, location and appropriation of said Eulalia mining claim. They did not question the validity of the state statutes, which prescribe certain acts as necessary to a valid location, but set up a compliance with them, and contended that the defendant did not establish a valid location.
Plaintiffs did not claim by virtue of a discovery of their own, but by virtue of their knowledge of the existence of a vein within the surveyed limits of that claim, though several hundred feet distant from the discovery shaft of the Eulalia, which he, McMillen, together with his coowner, had previously discovered in the process of its development; and insisted that this knowledge was equivalent to an actual discovery by him of a vein within the Eulalia location.
The proposition of plaintiffs, as stated by their counsel, was this:
"That Mr. McMillen, as an owner and a locator of the Eulalia lode, knew at the time he placed his stake upon the Eulalia claim on the thirtieth of May, 1893, that he in company with the coowners of the Pocket Liner claim had discovered ore in the shaft of the Pocket Liner claim; that at the moment that he placed his stake upon that ground, claiming the Eulalia claim as abandoned and unoccupied territory, that theretofore there had been a discovery of mineral within the requirements of the statutes of the United States and of the State of Colorado, and that that knowledge within the mind of *346 Mr. McMillen constituted a complete, final and perfect location of that mining claim, provided he did the other things requisite under the statutes of the State of Colorado, by sinking a discovery shaft ten feet in depth, etc."
The substance of the plaintiff's argument was that the mere knowledge of the Eulalia locator of the existence of a vein in the Pocket Liner, the previous lode, made his location valid, provided he performed the other things requisite under the statutes of the State of Colorado, besides the actual discovery of mineral. The court did not deny the proposition that, if the locator knew that there had been a discovery of a vein or lode within his location, he might base his location upon it, although he made no discovery himself; but the statutes of Colorado provide (Mills Annotated Statutes, section 3152) certain requirements in addition to those specified in the Revised Statutes, among which were that the discoverer before filing his location certificate shall sink a discovery shaft to the depth of at least ten feet from the lowest part of the rim of such shaft at the surface, or deeper, if necessary, to show a well defined crevice, and shall also post at the point of discovery a notice containing the name of the lode, the name of the locator, and the date of the discovery, and shall also mark the surface boundary of the claim. The court further held that where "the locator himself selects the discovery shaft, as the one in which the discovery of mineral has been made, and there posts his location stake, and bases his location upon such discovery, he may not, after intervening rights have attached, abandon and disregard the same, neglect to comply with such provisions, and select another discovery upon which his location was not predicated."
In this connection the court held that if the plaintiffs relied upon a former discovery they were bound to show that it was claimed by their locator, or adopted by him as the only one upon which the Eulalia lode was made; and that the court was correct in refusing to hear the proof offered, since it did not meet the requirements of the decisions, to the effect that *347 a former discovery may be made the basis of a valid location. The court, however, found expressly that the plaintiffs not only did not question the validity of the state statutes, which prescribe certain acts as necessary to a valid location, but averred in their complaint that those statutes had been complied with.
After the disposition of the case by the Supreme Court, plaintiffs in error filed a petition for a rehearing, in which, for the first time, they raised the question that, as there had been upon their part a full compliance with the requirements of Rev. Stat. sec. 2320 before any valid adverse rights had intervened, there was a perfect and complete appropriation of this ground, and that court should have so adjudicated. In its opinion the court reiterated what it had previously said, that, admitting that the plaintiffs might have availed themselves of the previous discovery within the Eulalia location, and adopted the same as their own without making a valid discovery for themselves, they had not brought themselves within this principle, since in their offer of proof they merely relied upon a former knowledge of such location. In its opinion the court made no mention of the Federal question, which does not seem to have been pressed upon their attention. Though unnecessary to our decision a recent case upon this subject is instructive. Butte City Water Co. v. Baker, 196 U.S. 119.
It is sufficient for the purposes of this case to say that no Federal question appears to have been raised until the petition was filed for a rehearing. This was obviously too late, unless at least the court grants the rehearing and then proceeds to consider the question. Mallett v. North Carolina, 181 U.S. 589; Loeber v. Schroeder, 149 U.S. 580; Miller v. Texas, 153 U.S. 535.
In both courts the question was treated as one of local law, and the mere fact that suit was brought under Rev. Stat. sec. 2326 to try adverse rights to a mining claim, does not necessarily involve a Federal question, so as to authorize a writ of error from this court. Bushnell v. Crooke Mining Co., *348 148 U.S. 682; Telluride Power Co. v. Rio Grande Ry. Co., 175 U.S. 639; Blackburn v. Portland Gold Mining Co., 175 U.S. 571; Shoshone Mining Co. v. Rutter, 177 U.S. 505.
The writ of error is accordingly dismissed. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/96256/ | 197 U.S. 356 (1905)
KEPPEL
v.
TIFFIN SAVINGS BANK.
No. 116.
Supreme Court of United States.
Argued January 6, 1905.
Decided April 3, 1905.
CERTIFICATE FROM THE CIRCUIT COURT OF APPEALS FOR THE SIXTH CIRCUIT.
*357 Mr. John C. Royer, with whom Mr. Henry J. Weller was on the brief for Keppel, trustee.
Mr. George E. Seney, Mr. Milton Sayler and Mr. John L. Lott for the Tiffin Savings Bank.
*359 MR. JUSTICE WHITE, after making the foregoing statement, delivered the opinion of the court.
The following are the questions asked by the Court of Appeals:
"First. Can a creditor of a bankrupt, who has received a merely voidable preference, and who has in good faith retained such preference until deprived thereof by the judgment of a court upon a suit of the trustee, thereafter prove the debt so voidably preferred?
"Second. Upon the issue as to the allowance of the bank's claims was it competent, in explanation of the judgment of the Ohio Circuit Court in favor of the trustee and against the bank in respect to its $2,000 mortgage, to show the disclaimer made in open court by the attorney, representing the bank, of any claim of preference, and the grounds upon which the bank declined to consent to a judgment in favor of the trustee?
"Third. If the failure to `voluntarily' surrender the mortgage given to secure the $2,000 note operates to prevent the allowance of that note, does the penalty extend to and require the disallowance of both the other claims?"
Before we develop the legal principles essential to the solution *360 of the first question it is to be observed that the facts stated in the certificate and implied by the question show that the bank acted in good faith when it accepted the mortgage and when it subsequently insisted that the trustee should prove the existence of the facts which, it was charged, vitiated the security. It results that the voidable nature of the transaction alone arose from section 67e of the act of 1898, invalidating "conveyances, transfers, or encumbrances of his property made by a debtor at any time within four months prior to the filing of the petition against him, and while insolvent, which are held null and void as against the creditors of such debtor by the laws of the State, Territory or District in which such property is situate'" and giving the assignee a right to reclaim and recover the property for the creditors of the bankrupt estate.
On the one hand it is insisted that a creditor who has not surrendered a preference until compelled to do so by the decree of a court cannot be allowed to prove any claim against the estate. On the other hand, it is urged that no such penalty is imposed by the bankrupt act, and hence the creditor, on an extinguishment of a preference, by whatever means, may prove his claims. These contentions must be determined by the text, originally considered, of section 57g of the bankrupt act, providing that "the claims of creditors who have received preferences shall not be allowed unless such creditors shall surrender their preferences." We say by the text in question, because there is nowhere any prohibition against the proof of a claim by a creditor who has had a preference, where the preference has disappeared as the result of a decree adjudging the preferences to be void, unless that result arises from the provision in question. We say also from the text as originally considered, because, although there are some decisions under the act of 1898 of lower Federal courts, which are referred to in the margin,[1] denying the right of a creditor *361 to prove his claim, after the surrender of a preference by the compulsion of a decree or judgment, such decision rests not upon an analysis of the text of the act of 1898 alone considered, but upon what were deemed to have been analogous provisions of the act of 1867 and decisions thereunder. We omit, therefore, further reference to these decisions as we shall hereafter come to consider the text of the present act by the light thrown upon it by the act of 1867 and the judicial interpretation which was given to that act.
The text is, that preferred creditors shall not prove their claims unless they surrender their preferences. Let us first consider the meaning of this provision, guided by the cardinal rule which requires that it should, if possible, be given a meaning in accord with the general purpose which the statute was intended to accomplish.
We think it clear that the fundamental purpose of the provision in question was to secure an equality of distribution of the assets of a bankrupt estate. This must be the case, since, if a creditor, having a preference, retained the preference, and at the same time proved his debt and participated in the distribution of the estate, an advantage would be secured not contemplated by the law. Equality of distribution being the purpose intended to be effected by the provision, to interpret it as forbidding a creditor from proving his claim after a surrender of his preference, because such surrender was not voluntary, would frustrate the object of the provision, since it would give the bankrupt estate the benefit of the surrender or cancellation of the preference, and yet deprive the creditor of any right to participate, thus creating an inequality. But it is said, although this be true, as the statute is plain, its terms cannot be disregarded by allowing that to be done which it expressly forbids. This rests upon the assumption that the word "surrender" necessarily implies only voluntary actions, and hence excludes the right to prove where the surrender is the result of a recovery compelled by judgment or decree.
*362 The word "surrender," however, does not exclude compelled action, but to the contrary generally implies such action. That this is the primary and commonly accepted meaning of the word is shown by the dictionaries. Thus, the Standard Dictionary defines its meaning as follows: 1. To yield possession of to another upon compulsion or demand, or under pressure of a superior force; give up, especially to an enemy in warfare; as to surrender an army or a fort. And in Webster's International Dictionary the word is primarily defined in the same way. The word, of course, also sometimes denotes voluntary action. In the statute, however, it is unqualified, and generic, and hence embraces both meanings. The construction, which would exclude the primary meaning so as to cause the word only to embrace voluntary action would read into the statute a qualification, and this in order to cause the provision to be in conflict with the purpose which it was intended to accomplish, equality among creditors. But the construction would do more. It would exclude the natural meaning of the word used in the statute in order to create a penalty, although nowhere expressly or even by clear implication found in the statute. This would disregard the elementary rule that a penalty is not to be readily implied, and on the contrary that a person or corporation is not to be subjected to a penalty unless the words of the statute plainly impose it. Tiffany v. National Bank of Missouri, 18 Wall. 409, 410. If it had been contemplated that the word "surrender" should entail upon every creditor the loss of power to prove his claims if he submitted his right to retain an asserted preference to the courts for decision, such purpose could have found ready expression by qualifying the word "surrender" so as to plainly convey such meaning. Indeed, the construction which would read in the qualification would not only create a penalty alone by judicial action, but would necessitate judicial legislation in order to define what character and degree of compulsion was essential to prevent the surrender in fact from being a surrender within the meaning of the section.
*363 It is argued, however, that courts of bankruptcy are guided by equitable considerations, and should not permit a creditor who has retained a fraudulent preference until compelled by a court to surrender it, to prove his debt and thus suffer no other loss than the costs of litigation. The fallacy lies in assuming that courts have power to inflict penalties, although the law has not imposed them. Moreover, if the statute be interpreted, as it is insisted it should be, there would be no distinction between honest and fraudulent creditors, and therefore every creditor who in good faith had acquired an advantage which the law did not permit him to retain would be subjected to the forfeiture simply because he had presumed to submit his legal rights to a court for determination. And this accentuates the error in the construction, since the elementary principle is that courts are created to pass upon the rights of parties, and that it is the privilege of the citizen to submit his claims to the judicial tribunals, especially in the absence of malice and when acting with probable cause, without subjecting himself to penalties of an extraordinary character. The violation of this rule, which would arise from the construction, is well illustrated by this case. Here, as we have seen, it is found that the bank acted in good faith without knowledge of the insolvency of its debtor and of wrongful intent on his part, and yet it is asserted that the right to prove its lawful claims against the bankrupt estate was forfeited simply because of the election to put the trustee to proof in a court of the existence of the facts made essential by the law to an invalidation of the preference.
We are of opinion that, originally considered, the surrender clause of the statute was intended simply to prevent a creditor from creating inequality in the distribution of the assets of the estate by retaining a preference and at the same time collecting dividends from the estate by the proof of his claim against it, and consequently that whenever the preference has been abandoned or yielded up, and thereby the danger of inequality has been prevented, such creditor is entitled to stand *364 on an equal footing with other creditors and prove his claims.
Is the contention well founded that this meaning, which we deduce from the text of the surrender clause of the present act, is so in conflict with the rule generally applied in bankruptcy acts, and is especially so contrary to the act of 1867 and the construction given to it, that such meaning cannot be considered to have been contemplated by Congress in adopting the present act, and hence a contrary interpretation should be applied?
Without attempting to review the English bankruptcy acts or the provisions contained therein concerning what constituted provable debts, and the decisions relating thereto, it is clear that under those acts, where a debt was otherwise provable and the creditor had acquired a lien to which he was not entitled, the English courts in bankruptcy did not imply a forfeiture by refusing to allow proof of the debt because there had not been a voluntary surrender of the preference. On the contrary, where claims were filed against the estate by one who was asserted to have retained a preference, a well-settled practice grew up, enforced from equitable considerations. The practice in question was followed in the case of Ex parte Dobson, 4 Deacon & Chitty English Bankruptcy Reports, 69, decided in 1834, and was thus stated in the opinion of Sir G. Rose (p. 78):
"I apprehend the practice to be settled, where a creditor applies to prove a debt, and claims a right to property to which the Commissioners think he has no lien, that the Commissioners admit the proof, and leave the question to be controlled merely by retention of the dividend. This was settled by the case of Ex parte Ackroyd [1 Rose, 391], where the Commissioners had rejected the proof of a creditor, because he had received a portion of his debt, which the assignees contended he was bound to refund; but when the question came before Sir John Leach, as Vice Chancellor, he decided that the proof of the debt was not to be rejected, because there was a question *365 to be tried between the bankrupt's assignees and the creditor, although it was proper that no dividend should be paid on that proof, until the question was determined."
And Erskine, C.J., p. 78, after assuming that the transaction complained of might have been fraudulent and amounted to an act of bankruptcy, said italics mine (p. 75):
"The next part of the prayer is, that the claim should be disallowed. But though the assignment of the property may be invalid, that will not invalidate the debt of the respondents. We could not therefore disallow the claim, or expunge the proof, if the claim had been converted into a proof; all that we can do is, to restrain the respondents from receiving any dividends, until they give up the property."
Thus the English rule substantially conformed to the construction we have given to the bankruptcy act before us.
Neither our bankrupt act of 1800, 2 Stat. 19, nor that of 1841, 5 Stat. 440, contained a surrender clause or any provision generally denying the right of a creditor of a bankrupt to prove his debt in the event that he had received a preference. But, under those acts, bankruptcy courts must necessarily have exercised the power of protecting the estate by preventing a creditor having an otherwise provable debt who retained that which belonged to the estate from at the same time taking dividends from it.
The purpose of Congress when a forfeiture or penalty was intended not to leave it to arise from mere construction, but to expressly impose such penalty or forfeiture, is well illustrated by the bankrupt act of 1800, wherein numerous penalties and forfeitures were explicitly declared. Two instances are illustrative. By section 16 it was provided: "That if any person or persons shall fraudulently, or collusively claim any debts, or claim or detain any real or personal estate of the bankrupt, every such person shall forfeit double the value thereof, to and for the use of the creditors." And by section 28 it was provided that a creditor suing out a commission, who subsequently accepted a preference, "shall forfeit and lose, as well *366 his or her whole debts, as the whole he or she shall have taken and received, and shall pay back, or deliver up the same, or the full value thereof to the assignee or assignees who shall be appointed or chosen under such commission, in manner aforesaid, in trust for, and to be divided among the other creditors of the said bankrupt, in proportion to their respective debts."
The bankrupt act of 1867, c. 176, 14 Stat. 517, 528, contained the following surrender clause:
"SEC. 23. . . . Any person who, after the approval of this act shall have accepted any preference, having reasonable cause to believe that the same was made or given by the debtor, contrary to any provision of this act, shall not prove the debt or claim on account of which the preference was made or given, nor shall he receive any dividend therefrom until he shall first have surrendered to the assignee all property, money, benefit, or advantage received by him under such preference."
And section 35 of the act conferred power upon the assignee to sue to set aside and recover illegal preferences, transfers, etc., but there was not contained in the section any provision prohibiting the proof of claims after recovery by the assignee. In section 39 of the act, however, which was found under the head of involuntary bankruptcy, there was contained an enumeration of the various acts which would constitute acts of bankruptcy, and following a grant of authority to the assignees to sue for and recover property transferred, etc., by the bankrupt contrary to the act, the section concluded with the declaration that when the recipient had reasonable cause to believe that a fraud on the act was intended, and that the debtor was insolvent, "such creditor shall not be allowed to prove his debt in bankruptcy."
Passing the present consideration of the judicial construction given to the act of 1867, and treating, as we believe should be done, the restriction as to the proof of debts expressed in section 39 as applicable to voluntary as well as involuntary bankruptcy, we think, as a matter of original interpretation, the surrender clause of the act of 1867 not only fortifies but absolutely *367 sustains the construction which we have given to the surrender clause of the act of 1898. Whilst the surrender clause of the act of 1867 changed the method of procedure prevailing under the English rule, and presumptively also obtaining under the acts of 1800 and 1841, by which a creditor holding a preference might prove his claim but was allowed to obtain no advantage from so doing until he had surrendered his preference, it cannot we think in reason be considered that this mere alteration in the practice to be followed was intended in and of itself to impose a penalty upon a creditor who did not voluntarily surrender his preference. And this we think is demonstrated when it is seen that after making the change as to the procedure in the proof of debts by preferred creditors there was subsequently embodied in section 39 an express prohibition, in the nature of a penalty, forbidding the proof of debt by a creditor who came within the purview of the section. Either that provision solely related to proof of debts embraced in the previous surrender clause or it did not. If it did, then the expression of the penalty in section 39 indicates that it was not deemed that the surrender clause contained provision for the penalty, otherwise section 39 would in that regard be wholly superfluous. If, on the other hand, it be considered that section 39 embraced other debts or claims against the estate than those to which the surrender clause related, then the expression of the penalty in section 39, under the rule of expressio unius, could not by implication be read into the previous surrender clause. That is to say, if section 23 and section 39 of the act of 1867 be considered as not in pari materia, then it follows that the former, the surrender clause, standing alone, did not impose the penalty or forfeiture provided for in the latter. If they were in pari materia, then the penalty, whilst applicable and controlling as to both, because of its expression in the later section, cannot be said to have existed alone in and by virtue of an earlier section, wherein no penalty was expressed.
The decisions of the lower Federal courts interpreting the *368 sections in question, as they stood prior to the amendment of section 39 of the act of 1874, hereafter to be referred to, were numerous, and we shall not attempt to review them in detail. They will be found collected in a note contained in the eleventh edition of Bump on Bankruptcy, pp. 550 et seq. Disregarding the discord of opinion shown by those decisions concerning what constituted an involuntary surrender that is, whether it was involuntary if made at any time after suit brought by the assignee, or was only so after recovery by the force of a judgment or decree and putting out of view also the differences of opinion which were engendered by the fact that the forfeiture imposed by section 39 was found in that portion of the act of 1867 which related to involuntary bankruptcy, we think the decisions under the act of 1867, prior to the amendment of 1874, may be classified under four headings.
First. The cases which held that the prohibition of section 39 against the proof of debt operated as a bar to such proof, even although there was a voluntary surrender, where the preference had the characteristics pointed out in section 39. These cases were, however, contrary to the great weight of authority under the act, and the construction which they enforced may be put out of view.
Second. Those cases which, whilst treating the surrender clause as giving a creditor an alternative which he might exercise without risk of penalty or forfeiture, yet held that by the operation of section 39 upon the surrender clause the creditor lost the option to prove his claim, when the surrender was compelled by a judgment or decree at the suit of the assignee. The cases enforcing this interpretation constituted the weight of authority, and such construction may, therefore, be said to have been that generally accepted, and, in our judgment, was the correct one.
These cases, which thus held that the loss of the right to prove, after compulsory surrender, arose not from the surrender clause independently considered, but solely from the operation upon that clause of section 39, are exemplified by *369 the case of In re Leland, 7 Ben. 156, opinion of Blatchford, J. In that case, after holding (p. 162) that the prohibition of section 39 applied as well to cases of voluntary as to cases of involuntary bankruptcy, the court came to consider the surrender clause of section 23 as affected by the penalty provided for in section 39, and said:
"This provision is to be construed in connection, and in harmony, with the provision of the twenty-third section, before cited. If, under the twenty-third section, the preferred creditor were allowed to surrender to the assignee the property received in preference, even after it had been recovered back by the assignee, as mentioned in the thirty-ninth section, so as to be able to prove his debt, no creditor taking a preference would ever be debarred from proving his debt. If, under the thirty-ninth section, it were held that the mere taking of a preference by a creditor would debar him from proving his debt, without the precedent necessity for a recovery back by the assignee of the property conveyed in preference, there never could be any scope for the operation of the twenty-third section in respect to a surrender."
Thus clearly pointing out that by the surrender clause alone the creditor would not be debarred from proving his claim if in fact there had been a surrender, whether voluntary or not, but that as a result solely of the prohibition of section 39 the creditor would be barred after recovery by the assignee.
Third. Cases which treated the surrender clause as in and of itself forbidding a surrender after recovery, because the recovery authorized by section 35 was the antithesis of the surrender and precluded a surrender after recovery. This class of cases in effect treated the prohibition expressed in section 39 as unnecessary, quoad the subject matters to which sections 23 and 35 were addressed. The cases, however, were few in number, and are illustrated by the case of In re Tonkin, 4 N.B.R. 52.
Fourth. Cases which without seemingly considering the incongruity of the reasoning adopted both theories; treated *370 sections 23, 35 and 39 as in pari materia, and hence applied the prohibition of section 39 to the other two sections, and yet reasoned to show that the surrender clause alone prohibited a surrender after recovery by the assignee. This class of cases is illustrated by In re Richter, 1 Dill. 544; 4 N.B.R. 221. In that case a creditor, who, in consequence of a recovery by the assignee, had surrendered a preference, sought to prove his claim against the estate, and his right to do so was resisted. Analyzing the act and stating the different constructions of which it was susceptible, the court expressly declared that the correct view was to construe sections 23, 35 and 39 together, and that the result of so doing would be to annex to both section 35 and 23 the penalty provided in section 39. The surrender clause was then noticed, it being said:
"It is urged by the claimants that this refusal was erroneous because they had, before the time when they made their motion, surrendered to the assignee all property received by them under the preference. This devolves upon us the duty of interpreting the meaning of the word surrender, as it is here used. And it is our opinion, that a creditor who receives goods by way of fraudulent preference, and who refuses the demand therefor which the assignee is authorized to make (section 15), denies his liability, allows suit to be commenced by the assignee, defends it, goes to trial, is defeated and judgment passes against him, which he satisfies on execution, cannot be said within the meaning of the statute, to have surrendered to the assignee the property received by him under such preference. He has surrendered nothing."
As an alternative, however, to this view, and treating the sections referred to as in pari materia, it was reiterated that section 23 was limited and controlled by the penalty provided in section 39.
We need not further notice the cases under the act of 1867, because of the action of Congress on the subject. In 1874, 18 Stat. 178, section 39 of the act of 1867 was amended and reenacted. That amendment consisted of omitting the forfeiture *371 clause as originally contained in the section and substituting in its stead the following proviso:
"Provided, . . . and such person, if a creditor, shall not, in cases of actual fraud on his part, be allowed to prove for more than a moiety of his debt; and this limitation on the proof of debts shall apply to cases of voluntary as well as involuntary bankruptcy."
Plainly, this amendment not only abolished the penalty provided in section 39 as originally enacted, since it allowed a creditor to prove his claim for the whole amount thereof after recovery against him if he had not been guilty of actual fraud, and even in case of actual fraud after recovery permitted him to prove for a moiety. The amendment clearly also was repugnant to that construction of the act of 1867 given in some of the cases to which we have referred under the third classification, wherein in the reasoning employed it was assumed that a forfeiture or penalty might be implied alone from the terms of the surrender clause, irrespective of the operation of section 39. This results from the very words of the amendment, which says, and this limitation on the proof of debts shall apply, etc., showing that the restriction on the right to prove after a compulsory yielding up of a preference was deemed by Congress to result, not from the surrender clause, but from the limitation expressly declared by section 39 as amended, which operated a qualification of the broad terms of the surrender clause. It manifestly also arises from the fact that whilst Congress plainly intended by the amendment to make a change in the rigor of the rule previously obtaining, the phraseology of the surrender clause as originally found in the act was not altered.
After the adoption of the amendment of 1874 it is true that in one or two instances it was held that the amendment, instead of mitigating the severity of section 39 as it stood before the amendment, had increased it by adding an additional limitation, viz., prohibiting a preferred creditor who had been guilty of actual fraud from proving for more than one-half of his claim, even where he had voluntarily surrendered his *372 preference. But these were isolated cases, since practically the otherwise universal construction was that the amendment was remedial and intended by Congress to mitigate, even in cases of actual fraud, the severity of the prohibition of section 39 as originally enacted.
The import of the amendment was tersely stated by Mr. Justice Clifford in In re Reed, 3 Fed. Rep. 798, 800, as follows:
"Beyond doubt the question must depend upon the true construction of the act of Congress, and I am of opinion that Congress intended to moderate the rigor of the prior rules and to allow the creditors, after payment back of the preference, whether by suit or otherwise, to prove their whole debt, in case they had been guilty of no actual fraud."
And such construction was also expounded in the following cases: In re Currier (1875), 2 Lowell, 436; Burr v. Hopkins, (1875) 6 Biss. 345, per Drummond, J.; In re Black (1878), 17 N.B.R. 399, per Lowell, J.; In re Newcomer (1878), 18 N.B.R. 85, per Blodgett, J.; In re Kaufman (1879), 19 N.B.R. 283, per Nixon, D.J.; In re Cadwell (1883), 17 Fed. Rep. 693, per Coxe, J.
The meaning of the amendment of 1874 was considered by the Court of Appeals of New York in the case of Jefferson County National Bank v. Streeter, 106 N.Y. 186. The New York court expressly adopted the construction given in the cases to which reference has just been made, and its action in so doing was affirmed by this court in Streeter v. Jefferson County Bank, 147 U.S. 36.
It follows that the construction which we at the outset gave to the text of the act of 1898, instead of being weakened, is absolutely sustained by a consideration of the act of 1867, both before and after the amendment of 1874, and the decisions construing the same, since in the present act, as we have said, there is nowhere found any provision imposing even the modified penalty which was expressed in the amendment of 1874. The contention that because the act of 1898 contains a surrender clause, therefore it must be assumed that *373 Congress intended to inflict the penalty originally imposed by section 39 of the act of 1867 must rest upon the erroneous assumption that that penalty was the result of the surrender clause alone. But this, as we have seen, is a misconception, since from the great weight of judicial authority under the act of 1867, as well as by the express enactment of Congress in the amendment of 1874 and the decisions which construed that amendment, it necessarily results that the penalty enforced under the act of 1867 arose not from the surrender clause standing alone, but solely from the operation upon that clause of the express prohibition contained in section 39 of that act. When, therefore, Congress in adopting the present act omitted to reenact the provision of the act of 1867, from which alone the penalty or forfeiture arose, it cannot in reason be said that the omission to impose the penalty gives rise to the implication that it was the intention of Congress to reenact it. In other words, it cannot be declared that a penalty is to be enforced because the statute does not impose it.
And, irrespective of this irresistible implication, a general consideration of the present act persuasively points out the purpose contemplated by Congress in refraining from reenacting the penalty contained in section 39 of the act of 1867. Undoubtedly the preference clauses of the present act, differing in that respect from the act of 1867, as is well illustrated by the facts of this case, include preferences where the creditor receiving the same acted without knowledge of any wrongful intent on the part of the debtor and in the utmost good faith. Pirie v. Chicago Title & Trust Co., 182 U.S. 438, 454. Having thus broadened the preference clauses so as to make them include acts never before declared by Congress to be illegal, it may well be presumed that Congress, when it enacted the surrender clause in the present act, could not have contemplated that that clause should be construed as inflicting a penalty upon creditors coming within the scope of the enlarged preference clauses of the act of 1898, thereby entailing an unjust and unprecedented result.
*374 Our conclusion, therefore, is that the first question propounded must be answered in the affirmative, and that the two other questions require no response.
And it is ordered accordingly.
MR. JUSTICE DAY, with whom JUSTICES HARLAN, BREWER and BROWN concurred, dissenting.
I am unable to agree with the construction given to the sections of the bankruptcy act under consideration, and because of the importance of the questions involved have deemed proper a statement of the conclusions reached.
Notwithstanding the first question propounded by the Court of Appeals presupposes that the $2,000 mortgage was a preference within the meaning of the bankrupt act, it is argued on behalf of the creditors that although the mortgage, made a few days prior to the bankruptcy proceedings and when the bankrupt was insolvent, was void under section 6343 of the Revised Statutes of Ohio, as amended April 26, 1898, 93 Ohio Laws, p. 290, read in connection with section 67, paragraph e, of the bankruptcy act, it did not constitute a preference which must be surrendered, preliminary to proof of the creditor's claim, because there was no actual transfer of any property to the creditor, and the only thing obtained was a void mortgage.
The Ohio statute makes provision, among other things, as to sales, etc., in trust or otherwise, in contemplation of insolvency, or with a design to prefer one or more creditors to the exclusion, in whole or in part, of others, and sets forth:
"And every such sale, conveyance, transfer, mortgage or assignment made, . . . by any debtor or debtors, in the event of a deed of assignment being filed within ninety (90) days after the giving or doing of such thing or act, shall be conclusively deemed and held to be fraudulent, and shall be held to be void as to the assignee of such debtors or debtors, whereupon proof shown, such debtor or debtors was or were actually insolvent at the time of the giving or doing of such act *375 or thing, whether he or they had knowledge of such insolvency or not. . . ."
By section 67, paragraph e, of the bankrupt act, it is provided:
"And all conveyances, transfers, or encumbrances of his property made by a debtor at any time within four months prior to the filing of the petition against him, and while insolvent, which are held null and void as against the creditors of such debtor by the laws of the State, Territory, or District in which such property is situate, shall be deemed null and void under this act against the creditors of such debtor if he be adjudged a bankrupt, and such property shall pass to the assignee and be by him reclaimed and recovered for the benefit of the creditors of the bankrupt."
Under section 60 of the bankruptcy act of 1898 it was provided:
"a. A person shall be deemed to have given a preference if, being insolvent, he has procured or suffered a judgment to be entered against himself in favor of any person, or made a transfer of any of his property, and the effect of the enforcement of such judgment or transfer will enable any one of his creditors to obtain a greater percentage of his debt than any other of such creditors of the same class.
"b. If a bankrupt shall have given a preference within four months before the filing of a petition, or after the filing of the petition and before the adjudication, and the person receiving it, or to be benefited thereby, or his agent acting therein, shall have had reasonable cause to believe that it was intended thereby to give a preference, it shall be voidable by the trustee, and he may recover the property or its value from such person."
In section 1, paragraph 25, of the act of 1898, a "transfer" is defined to include the sale and every other and different mode of disposing of or parting with the property or the possession of property, absolutely or conditionally, as a payment, pledge, mortgage, gift or security.
This definition of a transfer covers a mortgage given for the *376 security of a debt in express terms, and section 60 provides that preferences shall include transfers, the effect of the enforcement of which would be to enable any one of the bankrupt's creditors to obtain a greater percentage of his debt than other creditors of the same class.
It is true that if the mortgage is void, it can have no effect to diminish the estate of the bankrupt, but upon its face the mortgage is good as against the bankrupt and the creditors of the estate.
It is said that the mortgage being void, the creditor had nothing to surrender, but this assumes the invalidity of the security. Until set aside or voluntarily surrendered it is a good encumbrance upon the property, whether regarded as a conditional conveyance or as a mere security for the debt. It could be set aside by the trustee upon proof of insolvency of the bankrupt and other conditions named in the act at the time of giving it; otherwise it would stand as a valid security, unless the creditor should elect to surrender it and make proof of his claim as a general creditor.
There seems to be no question that, upon its face, though void in the light of the facts found, this mortgage was one of the transfers of property which was invalidated by the act, it being given within the time limited, and at a time when the bankrupt was in fact insolvent, and expressly made void by the Ohio statute when read with the bankrupt act of 1898.
The answer to the first question requires a consideration of paragraph 57g of the act of 1898, which, as it stood prior to the amendment of February 5, 1903, read: "The claims of creditors, who have received preferences shall not be allowed unless such creditors shall surrender their preferences." May a creditor who has received a preference, voidable by the act, contest the validity thereof, and if it is declared invalid, still prove his debt upon surrender of his preference as though no contest had been had?
It was held by this court in Pirie v. Chicago Title & Trust Company, 182 U.S. 438, that a creditor who had received a *377 preference, although he did not have reason to believe that one was intended, could only keep the property transferred upon condition of refraining from proof of the balance of his debt.
It was pointed out in that case, in the opinion of the court by Mr. Justice McKenna, that section 60 in its various provisions permitted a creditor, who had innocently received a preference, to hold it if he chose, and it could only be recovered by the trustee in the event that he had reasonable cause to believe that a preference was intended, in which case the trustee might recover the property or its value. But the innocent creditor might keep the property transferred to him, although a preference within the definition of the act, upon terms of non-participation in the bankruptcy estate in the general distribution to the creditors.
Section 23 of the bankruptcy act of 1867 provided:" . . . Any person who, after the approval of this act shall have accepted any preference, having reasonable cause to believe that the same was made or given by the debtor, contrary to any provision of this act, shall not prove the debt or claim on account of which the preference was made or given, nor shall he receive any dividend therefrom until he shall first have surrendered to the assignee all property, money, benefit or advantage received by him under such preference." Section 57g of the present act, prior to the amendment of February 5, 1903, required broadly that claims of creditors who have received preferences shall be surrendered, and that the same shall not be allowed unless this is done.
Under the former act the surrender was required of creditors who had accepted preferences, having reasonable cause to believe the same contrary to the provisions of the act, and such creditor could not receive any dividend until he had first surrendered the preference. In passing the act of 1898, Congress doubtless had before it prior legislation on the subject, and particularly the act of 1867, the most recent enactment on the subject.
Section 57 g provides that all preferences, whether innocent *378 or otherwise, shall be surrendered before the creditor can prove his claim, and the right of proof is not postponed until the surrender, but claims are not to be allowed unless creditors shall surrender their preferences. The element of time is indicated in the word "until," which means to the time of, or up to, while the use of "unless" more emphatically denies the right of proving the claim, save or except upon terms of relinquishing the preference.
In view of the purpose of the bankruptcy act to make an equal distribution of the bankrupt's estate among creditors of the same class and to avoid preferences made within four months, I think, having in view the first question put by the Circuit Court of Appeals, that the sections of the law in question must be construed to put a creditor who has received a merely voidable preference, which could be recovered from him by the trustee, to his election between striving to retain that which he has received, and voluntarily surrendering his preference, and filing his claim that he may participate with other unsecured creditors in the general distribution of the estate.
The law looks to a prompt, equal and inexpensive distribution of the estate among those entitled thereto, and I do not think it was intended to permit a creditor to take the chances of litigation with the trustee, and when defeated still have the right to "surrender" his preference and participate in the distribution of the general estate. I think the surrender contemplated by the law is not the capitulation which comes after unsuccessful resistance, but is intended to require the creditor, who must be presumed to know the law, to make a prompt election and to stand or fall upon the choice made. In other words, it was not intended to permit a creditor who holds security liable to defeat under the law to keep it if he can maintain it by successful contest, and, if not, to have the same right and privilege as to proof of his debt that he would have if he promptly availed himself of the privilege of surrender which the law gives to one who would place himself upon a general equality with other creditors of the estate.
*379 These conclusions are sustained by a consideration of the terms of the law under discussion, as well as the adjudicated cases which have arisen under it. The act of 1898 made important changes when compared with the bankrupt law of 1867. As we have already seen, section 23 of the latter act limited the requirement as to the surrender of preferences to those made or given contrary to the provisions of the act. Section 35 of the same law gave the right to the assignee in bankruptcy to set aside illegal preferences, and section 39, after enumerating certain transactions which should amount to acts of bankruptcy, including fraudulent conveyances as therein described, provided that whenever the beneficiary had reasonable cause to believe that a fraud upon the act was intended, or the debtor was insolvent, the assignee might recover the property, and the creditor should not be allowed to prove his debt in bankruptcy. In 1874, 18 Stat. 178, section 39 of the act was amended, and, instead of prohibiting a creditor who had received a conveyance in fraud of the act from proving his debt, it was provided that such creditor should not, in case of actual fraud on his part, be allowed to prove for more than a moiety of his debt, and this limitation should apply to cases of voluntary as well as involuntary bankruptcy.
It will not, in my view, aid in the determination of the proper construction of the act of 1898 to review the numerous and conflicting decisions made under the act of 1867 as to the effect of these various provisions upon the right of the creditor to prove his claim. The great weight of authority is that one who had a voidable preference under the act could not be permitted to prove his claim after a judgment had been rendered against him in a contest with the trustee.
Presumably with the provisions of the act of 1867 before it, providing that in certain cases of fraudulent conveyance the creditor could not prove his claim in bankruptcy, first as to the whole, and later as to a half of the debt, and the limitations of the requirement to surrender preferences to those made in violation of the act, Congress laid aside these requirements, *380 and broadly provided in section 57g of the act of 1898 that all preferences must be surrendered as a condition of proof of claims against the estate. The innocent holder of a preference could not be deprived of his right of election between proof of his debt and the surrender of his preference. He who had a voidable preference might surrender it and prove his debt. If he did not "surrender," the trustee could recover the preference, and the privilege of proof which was conditioned upon surrender no longer existed.
Prior to the amendment of 1903 this court, in the case of Pirie v. Trust Company, already referred to, decided that the requirement extended to all manner of preferences, whether innocently received or otherwise, and this was the law until the amendment of 1903.
Therefore the sole question here is: What is meant by the term "surrender" as used in the act of 1898?
We have been referred to four cases decided under this law before the passage of the amendment of 1903. Before passing to them I may refer to a decision of Judge Dillon at the circuit, In re Richter, 1 Dill. 544, rendered in 1870 under the act of 1867, but in defining the word "surrender" and pointing out its meaning, the language of the learned judge is as pertinent now as it was then. Having before him the construction of the term "surrender" as used in section 23 of the act of 1867, and speaking of the right of a creditor to prove the balance of a claim which had been illegally preferred, the judge said:
"The statute is that they shall not prove up the debt or claim on account of which the preference was given. It was this precisely which, by the motion under consideration, they sought to have done, and which the court refused to allow.
"It is urged by the claimants that this refusal was erroneous because they had, before the time when they made their motion, surrendered to the assignee all property received by them under the preference. This devolves upon us the duty of interpreting the meaning of the word surrender, as it is here used. And it is our opinion that a creditor, who receives *381 goods by way of fraudulent preference, and who refuses the demand therefor which the assignee is authorized to make (section 15), denies his liability, allows suit to be commenced by the assignee, defends it, goes to trial, is defeated and judgment passes against him, which he satisfies on execution, cannot be said within the meaning of the statute, to have surrendered to the assignee the property received by him under such preference.
"He has surrendered nothing. He accepted a fraudulent preference and defended it to the last. Paying a judgment which he stoutly resisted, and from which he could not escape, is not such a surrender as the statute contemplates. To hold that it was would be against the spirit of the statute, which is to discourage preferences. Such a holding would manifestly encourage them, for if the transaction should be upheld the creditor would profit, if overthrown, he would lose nothing, and stand upon an equal footing with those over whom he had attempted to secure an illegal advantage, and whom he has, by litigation, delayed in the collection of their claims."
The question, under the act of 1898, came before the United States District Court for the Northern District of Iowa, in the case of In re Keller, 109 Fed. Rep. 118; 6 Am. B.R. 334, where the subject is discussed by Judge Shiras. Summing up the matter, the learned judge said:
"It would certainly be wholly inequitable to hold that a creditor who has received a preference from an insolvent debtor can refuse to account therefor, and after causing the other creditors the delay, cost, and expense of litigation, after being defeated therein, can still prove up his claim, and take an equal share in the proceeds of the estate after depleting the same in the manner stated. Contesting the claim of the trustee, and paying back the preference in obedience to the process of the court, is not a surrender, within the meaning of clause `g' of section 57. Therefore there is this difference between a preferred creditor who surrenders the preference and a preferred creditor from whom the preference is recovered by the trustee. *382 The former, having voluntarily surrendered the preference received, is entitled to prove up his entire claim, and share with the other creditors. The latter, having refused to surrender, cannot prove the claim or share in the estate."
To the same effect is In re Owings, 109 Fed. Rep. 623, and in In re Greth, 112 Fed. Rep. 978; 7 Am. B.R. 598, the cases are reviewed and the same conclusion reached.
In Collier on Bankruptcy, third edition, section 319, that author says:
"The question what constitutes a surrender has received much discussion. It is admitted by all that if the assignee is compelled to bring an action to invalidate a transfer, and if he recovers and enters up a judgment, no subsequent payment of that judgment by the preferred creditor and no subsequent compliance by him with its terms can be considered a surrender. By his judgment the trustee has `recovered' the property. In legal effect the transferee no longer has anything to surrender."
And in the fifth edition of the same work, p. 420, it is said:
"What is a surrender. Here the doctrines declared under the law of 1867 seem at least somewhat applicable. The phrasing of that statute undoubtedly colored some of the decisions under it. But, under well-recognized principles of law, a surrender that is compulsory is not a surrender. The element of fraud is usually present, but may be lacking; the test is: was the act a voluntary one? Each case turns on its own facts and there is some conflict, but the weight of decision under the present law supports this view."
The only case, decided under the act of 1898, which has come to my attention sustaining a contrary view is In re Richard, 94 Fed. Rep. 633; 2 Am. B.R. 506, in which it was decided that, notwithstanding the preference was set aside, after a fruitless fight with the trustee, the creditor might prove his claim.
We are cited to Streeter v. Jefferson County Bank, 147 U.S. 36, as sustaining the contrary view of the meaning of the term *383 "surrender" as used in this act. The case was under the act of 1867. But in that case the contest was over a stock of goods, and the creditor, the bank, had consented through its attorneys to the appointment of a special receiver, who was ordered to sell the goods and pay the proceeds into court. Of this feature of the case Mr. Justice Shiras, who delivered the opinion of the court, said (p. 45):
"To sustain the contention that the bank did not surrender its preference, it is urged that the bank did not at once, on demand of the assignee, turn over the goods levied on, but litigated the matter with the assignee in both the District and the Circuit Courts, and that the proceeds of the executions were not relinquished until final judgment was entered against the bank.
"It was the opinion of the state court that, as the sheriff, having custody of the goods seized on execution was, with the consent of the bank's attorneys, appointed special receiver, and was ordered to sell the goods and pay the proceeds into court, to await the result of the litigation between the bank and the assignee in bankruptcy, and that as the proceeds were finally turned over to the assignee, and thus became subject to distribution as bankruptcy assets, the transaction amounted to a surrender under section 5084. In so holding we think the state court was right."
We are also cited to the meaning of the word "surrender" as given in the Standard Dictionary:
"1. To yield possession of to another upon compulsion or demand, or under pressure of a superior force; give up, especially to an enemy in warfare; as to surrender an army or a fort."
This definition is given in support of the contention that a surrender may sometimes be made involuntarily. This is doubtless true, and obviously the term may have different meanings when used in different connections. It may be that an army may surrender a fort after a most vigorous contest, while there is still the choice between further resistance and *384 yielding the fortress to an enemy, but the most liberal meaning of the term could hardly describe as a surrender the occupation which a victorious army has gained of a fort after it has ejected the enemy from its walls and is securely intrenched therein without leave of those who have been forcibly driven out.
The bankrupt law contemplates that a secured creditor, who holds a security voidable under the law and which he should put into the common fund as a condition of the right to participate with other unsecured creditors in the division of the estate, must make his choice while he has yet something to give for the privilege of being taken from the class of those who have a security which may be taken from them, and placed in a class, always favored in the bankrupt law, who shall share in the equal distribution of the bankrupt's estate, freed from fraudulent conveyances and voidable preferences.
The complete answer to the argument that one who has received a preference which he must give up before proof as a general creditor has the right to try out with the trustee the question of the validity of the preference and then surrender, is that when the judgment of the law has taken the preference from him he has nothing left to surrender, and if then so disposed the creditor cannot surrender a thing which has been wrested from him by the strong hand of the law.
In this case the Ohio statutes, when read with the bankrupt law, distinctly avoid preferences, and the trustee, by bringing the action, diminished the estate and delayed its distribution. The creditor, before the litigation, had his election as to the course he would pursue. While he had something to surrender he might give it up, prevent costs, delay and litigation, and aid the speedy and equal distribution of the bankrupt's estate. After two judgments against him, and when he had absolutely nothing to give up to the bankrupt's estate, it is, in our view, too late to "surrender."
I think the construction here given comports with the purposes and carries into effect the design of the act as expressed *385 by its terms. It is true that in the present case, after resisting the attack upon the $2,000 mortgage in the Court of Common Pleas, and when the judgment had gone against the bank it did not appeal, and its counsel in the Circuit Court disclaimed intention to insist upon the preference of the $2,000 mortgage, but even then refused consent to a decree against the mortgage, and in our opinion the time of election was before judgment in the court of original jurisdiction wherein the mortgage was contested and defeated. It is unnecessary to consider whether an election to surrender the preference can be made after issued joined and before judgment. In this case a trial was had upon the merits. The judgment rendered was vacated by the appeal and in the appellate court, notwithstanding the qualified disclaimer of counsel for the bank, a final judgment was rendered against the mortgage.
These considerations lead to the conclusion that the first and second questions should be answered in the negative.
The importance of the ruling just made is shown in its application not only to the act of 1898 as it originally stood, but to the act as it now stands since the amendment of February 5, 1903, which only requires a surrender of preferences when the same are in violation of subdivision b of section 60, or void or voidable under § 67, subdivision e. The reasoning of the majority of the court permits the holder of a preference, no matter how fraudulent, to contest with the trustee when his preference is attacked, and when convicted of fraud and an intention to defeat the purposes of the law to "surrender" that which the law has declared he cannot hold, and prove his debt as a general creditor. To permit this seems to me to defeat the purpose of the act and to encourage the very thing the surrender clause was intended to promote a prompt and inexpensive distribution of the estate. The fraudulent transferee, although he has lost his suit, has taken no risk, and may still prove his claim on an equality with unpreferred creditors over whom he has sought an illegal advantage. I cannot agree *386 with this construction, and therefore dissent from the judgment and reasoning of the majority of the court.
I am permitted to state that MR. JUSTICE HARLAN, MR. JUSTICE BREWER, and MR. JUSTICE BROWN concur in this dissent.
NOTES
[1] In re Greth, 112 Fed. Rep. 978; In re Keller, 109 Fed. Rep. 118, 127; In re Owings, 109 Fed. Rep. 623. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/740662/ | 113 F.3d 1240
NOTICE: Ninth Circuit Rule 36-3 provides that dispositions other than opinions or orders designated for publication are not precedential and should not be cited except when relevant under the doctrines of law of the case, res judicata, or collateral estoppel.Rodolfo Maghirang BANGUNAN, Petitioner,v.IMMIGRATION AND NATURALIZATION SERVICE, Respondent.
No. 96-70242.
United States Court of Appeals, Ninth Circuit.
Submitted April 21, 1997.*Decided May 2, 1997.
On Petition for Review of an Order of the Board of Immigration Appeals, No. Asc-qmm-vkw.
BIA
REVIEW DENIED.
Before: BROWNING, THOMPSON, and HAWKINS, Circuit Judges.
1
MEMORANDUM**
2
Rodolfo Maghirang Bangunan, a native and citizen of the Philippines, petitions for review of the Board of Immigration Appeals' ("BIA") decision affirming the immigration judge's ("IJ") denial of his applications for asylum and withholding of deportation under sections 208(a) and 243(h) of the Immigration and Nationality Act ("the Act"), 8 U.S.C. §§ 1158(a), 1253(h). We have jurisdiction pursuant to 8 U.S.C. § 1105a(a), and we deny the petition.
3
Bangunan contends that there is no substantial evidence to support the BIA's determination that he has failed to establish past persecution or a well-founded fear of future persecution on account of political opinion. We disagree.
4
The BIA's decision whether to grant asylum is reviewed for abuse of discretion. See Acewicz v. INS, 984 F.2d 1056, 1061 (9th Cir.1993). Factual findings underlying the BIA's decision, including whether the alien has proven past persecution or a well-founded fear of future persecution, are reviewed for substantial evidence. See id. Under the substantial evidence standard, we must uphold the BIA's denial of asylum unless the alien demonstrates that the evidence he presented was so compelling that no reasonable factfinder could fail to find the requisite fear of persecution. See INS v. Elias-Zacarias, 502 U.S. 478, 481 (1992).
5
To be eligible for asylum, an applicant must show either "persecution or a well-founded fear of persecution on account of race, religion, nationality, membership in a particular social group, or political opinion." 8 U.S.C. § 1101(a)(42)(A). To establish a well-founded fear of future persecution, the applicant must show both a genuine subjective fear of persecution and an objectively reasonable fear. See Acewicz, 984 F.2d at 1061. The objective component requires "a showing by 'credible, direct, and specific evidence' of facts supporting a reasonable fear of persecution" on account of one of the enumerated grounds. Id. (citation omitted).
6
Here, Bangunan claimed that he suffered persecution between 1988 and 1989, when he received letters from the New People's Army ("NPA") demanding bribes. After he failed to respond, the NPA beat him and kidnapped him overnight, and he was not released until a payment of 3,000 pesos was made. Bangunan received further letters, causing him to relocate or to go into hiding until he eventually left for Saudi Arabia and then the United States. Bangunan further stated that "he refused to become a supporter of the NPA, because [he] was and still [is] opposed to Communism and [doesn't] believe to their ideology."
7
First, Bangunan contends that there is substantial evidence to grant him asylum on account of political opinion. However, Bangunan's admission that the NPA wanted his money and that he was immediately released once the bribe was paid evidences the economic rather than political motivation of the NPA. See Abedini v. INS, 971 F.2d 188, 192 & n. 1 (9th Cir.1992). In addition, there was no evidence that Bangunan ever expressed his political views to the NPA or that the NPA was aware of his views. See id.; see also Alonzo v. INS, 915 F.2d 546, 548 (9th Cir.1990) (holding that persecution is not established when alien failed to show communication of political views or persecutor's awareness of those views). Substantial evidence, therefore, supports the BIA's determination that Bangunan's mistreatment was not on account of his personal political views, but on account of his financial status. See Elias-Zacarias, 502 U.S. at 481-82.
8
Second, Bangunan contends that there is substantial evidence of persecution on account of his membership in a particular social group. However, Bangunan's identification with successful small businessmen does not stem from any associational relationship, but simply because he was wealthy. See id.; see also De Valle v. INS, 901 F.2d 787, 793 (9th Cir.1990) (stating that a social group implies a collection of people closely affiliated with each other and who are actuated by some common impulse or interest). Substantial evidence, therefore, supports the BIA's determination that Bangunan failed to show persecution on account of membership in a particular social group. See Acewicz, 984 F.2d at 1061.
9
Third, Bangunan contends that there is substantial evidence to establish a well-founded fear of future persecution. However, the fact that Bangunan's problems seemed to subside after relocating to Manila establishes a strong likelihood of finding refuge in other areas in the Philippines, and avoiding future conflict with the NPA.1 See id.; see also Cuadras v. INS, 910 F.2d 567, 571 n. 2 (9th Cir.1990) (reaffirming that Court may consider that alien could avoid geographic localized danger by settling in a different part of the country). Substantial evidence, therefore, supports the BIA's determination that Bangunan has not established a well-founded fear of future persecution. See Acewicz, 984 F.2d at 1061.
10
Accordingly, we deny the petition for review because the evidence, even if accepted as true,2 would not compel a reasonable factfinder to find the requisite past persecution or well-founded fear of future persecution on account of political opinion. Acewicz, 984 F.2d at 1062.
11
Because Bangunan failed to demonstrate a well-founded fear of persecution, he also failed to satisfy the higher standard of "clear probability of persecution" required for withholding of deportation. See Ghaly v. INS, 58 F.3d 1425, 1429 (9th Cir.1995).
12
PETITION FOR REVIEW DENIED.
*
The panel unanimously finds this case suitable for decision without oral argument. See Fed.R.App.P. 34(a); 9th Cir.R. 34-4
**
This disposition is not appropriate for publication and may not be cited to or by the courts of this circuit except as provided by 9th Cir.R. 36-3
1
Bangunan also contends that the BIA misplaced reliance on certain factors in the State Department Report ("the Report") that prejudiced his claim. The BIA did not abuse its discretion by taking administrative notice of certain factors in the Report, especially since Bangunan's testimony and evidence presented actually supported the opinions in the Report regarding current country conditions and the NPA's motivations. See Ghaly v. INS, 58 F.3d 1425, 1429-30 (9th Cir.1995)
2
Bangunan contends that he has provided credible personal testimony and evidence to support a grant of political asylum and withholding of deportation. However, this court has no jurisdiction to review this contention because the IJ's adverse credibility determination was not raised by Bangunan on appeal to the BIA. See Rashtabadi v. INS, 23 F.3d 1562, 1567 (9th Cir.1994) | 01-03-2023 | 04-17-2012 |
https://www.courtlistener.com/api/rest/v3/opinions/1614481/ | 23 So.3d 199 (2009)
Joseph L. WORRELL, Appellant,
v.
Marcella M. WORRELL, Appellee.
No. 4D09-208.
District Court of Appeal of Florida, Fourth District.
November 25, 2009.
Joseph L. Worrell, Palm Beach Gardens, pro se.
No brief filed for appellee.
*200 POLEN, J.
Appellant, Joseph L. Worrell, appeals the trial court's denial of his Florida Family Law Rule of Procedure 12.540 motion for relief from the child support award he was ordered to pay his ex-wife, as part of a dissolution of marriage decree entered by the court. Worrell presents three claims on appeal: (1) the child support hearing officer lacked the authority to adjudicate the matter; (2) the trial court erred by refusing to enforce Florida Family Law Rule of Procedure 12.285; (3) the trial court erred by denying appellant's motion for relief pursuant to Florida Family Law Rule of Procedure 12.540. We affirm without comment as to the second and third issues; however, we affirm with brief discussion as to the first.
The Final Judgment of Dissolution of Marriage with Minor Child named Worrell's ex-wife primary residential custodian of their minor child. It also ordered that Mr. Worrell pay $500.00 per month in child support and an additional $100.00 per month toward agreed upon arrears. He appealed the judgment to this court which subsequently affirmed.
Mr. Worrell filed a motion pursuant to Florida Family Law Rule of Procedure 12.540, alleging 1) that the child support award was predicated on his ex-wife's fraudulently filed financial affidavit, which was used and relied on to calculate the amount of child support, and 2) the hearing officer presiding over the child support hearing lacked the authority to do so.
A hearing on the motion was held by a general magistrate and the motion was subsequently denied by the trial court. In regard to Mr. Worrell's allegations of fraudulent filing, the court found that no evidence was presented to establish such an assertion. The court also found that the hearing officer had the authority to preside over the child support matter under Florida Family Law Rule of Procedure 12.491(b).
On appeal, Worrell argues that his right to "full and fair jury or judicial hearing of grievances" was infringed because the child support hearing officer who presided over his rule 12.540 motion hearing was a "non-judicial official." Although he acknowledges that rule 12.491 provides that hearing officers may hear certain limited family law matters without the consent of both parties, he claims that the "many serious issues" raised in his 12.540 petition regarding fraud and deceit are "well outside the restricted scope" of rule 12.491.
Rule 12.491(b) confers subject matter jurisdiction to child support hearing officers for proceedings concerning "the establishment, enforcement, or modification of child support." Fla. Fam. L.R.P. 12.491(b)(1). This narrow grant is limited further by the caveat that a support enforcement hearing officer does not have the authority to hear contested paternity cases. Fla. Fam. L.R.P. 12.491(e).
Mr. Worrell's rule 12.540 motion prayed for relief from a child support judgment which was predicated on his exwife's allegedly fraudulent financial affidavit. This request for a modification to the child support award appears on its face to fall within the grant of jurisdiction outlined in rule 12.491(b)(1). Such a plain reading of the rule is illustrative. However, the question before the court is whether, given the unique nature of allegations of fraud, the appellant's 12.540 motion actually fell outside the contemplation of this rule.
Claims of fraud generally require a full explanation and exploration of the facts and circumstances of the alleged wrong. Robinson v. Kalmanson, 882 So.2d 1086, 1088 (Fla. 5th DCA 2004). A court can seldom determine the presence or absence of fraud without a trial or *201 evidentiary proceeding. Id. (citing Alepgo Corp. v. Pozin, 114 So.2d 645 (Fla. 3d DCA 1959), cert. denied, 117 So.2d 842 (Fla. 1960)). Allegations of fraud involve the intent or state of mind of the alleged perpetrator and thus require that the factfinder evaluate the credibility of witnesses and other evidentiary matters. See Webb v. Kirkland, 899 So.2d 344, 346-47 (Fla. 2d DCA 2005). However, child support hearing officers are fully able to conduct such examination, as rule 12.491 empowers them with the ability to "issue process, administer oaths, require the production of documents, and conduct hearings for the purpose of taking evidence." Fla. Fam. L.R.P. 12.491(e).
We find no case law that would serve to abrogate the jurisdiction plainly granted in the rule. In Oliveri v. Oliveri, 541 So.2d 174, 175 (Fla. 4th DCA 1989), this court held that it was beyond the authority of a hearing officer to make determinations with regard to attorney's fees and temporary alimony. We find this interpretation of rule 12.491[1] distinguishable, as the issue of fees and alimony cannot be construed as falling into one of either "the establishment, enforcement, or modification of child support," Fla. Fam. L.R.P. 12.491(b)(1). Whereas fees were clearly collateral to the issues which fell within the scope of jurisdiction in Oliveri, in the instant case, an allegation of fraud was the basis of the request for a modification of child support, a request for which the rule provides jurisdiction to hearing officers.
Further, while addressing the merits of lower court findings, the district courts have previously had the opportunity to admonish the practice of allowing hearing officers to deal with issues involving fraud, but have failed to do so. See State, Dep't of Revenue ex rel. Chambers v. Travis, 971 So.2d 157 (Fla. 1st DCA 2007) (holding that appellant failed to show good cause for a court order for paternity testing by failing to make an allegation of fraud, duress, material mistake of fact, or newly discovered evidence in the child support proceedings pending before the support enforcement hearing officer); State, Dep't of Health and Rehab. Servs. v. Day, 615 So.2d 176, 177 (Fla. 2d DCA 1993) (criticizing a child support hearing officer's conclusion that there "may" have been a fraud upon the court).
Given the plain reading of Florida Family Law Rule of Procedure 12.491, and the lack of case law abrogating the grant of jurisdiction, we find that the child support hearing officer in this case did not lack the authority to preside over the hearing on the appellant's motion to modify child support.
Affirmed.
WARNER and TAYLOR, JJ., concur.
NOTES
[1] In Oliveri, this court interpreted the grant of jurisdiction under Florida Rule of Civil Procedure 1.491, the predecessor to Florida Family Law Rule of Procedure 12.491. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919999/ | 151 Wis.2d 892 (1989)
447 N.W.2d 100
Gregory S. BIRES, Plaintiff-Appellant,
v.
CITY OF MAUSTON, City of Mauston Fire Department, and Heritage Insurance Company, Defendants-Respondents,
Richard HALE, John Does I through X inclusive, and Mauston Plumbing & Heating, Defendants.
No. 88-1641.
Court of Appeals of Wisconsin.
Submitted on briefs May 8, 1989.
Decided August 24, 1989.
*893 For the plaintiff-appellant, there were briefs by Daniel Berkos of Berkos Law Office, of Mauston.
On behalf of the defendants-respondents (City of Mauston and City of Mauston Fire Department), there were briefs by Barrette J. Corneille and Jean M. Wiencek of Bell, Metzner, Gierhart & Moore, S.C., of Madison.
On behalf of the defendant-respondent Heritage Mutual Insurance Company, there was a brief by James W. Mohr, Jr., of Hartford.
Before Eich, C.J., Gartzke, P.J., and Sundby, J.
EICH, C.J.
Gregory Bires appeals from a judgment dismissing his personal injury action against the City of Mauston Fire Department and several of its officers and employees. The trial court dismissed the action on grounds that workers compensation is the exclusive remedy for his injuries.
We see the issue as whether sec. 102.16(1), Stats., which provides that "[a]ny controversy concerning compensation ... shall be submitted to the department," requires decisions on an employee's entitlement to compensation which, under the "exclusive remedy" provisions of ch. 102, Stats., would bar any action at law for negligenceto be made in the first instance by the Department of Industry, Labor and Human Relations (DILHR) before being heard in court. We believe that it does, and we therefore reverse the trial court's dismissal of the action and remand with directions to the court to hold the action in abeyance until DILHR resolves the issue of Bires's entitlement to compensation. Because we so decide, we do not reach other issues raised by the parties.
Bire's injuries arose out of his participation in the City of Mauston's Volunteer Fire Department's "initiation *894 night." As part of his "initiation" as a firefighter, he was required to put on an old uniform and equipment and was then led to various bars by his fellow firefighters, where all consumed large amounts of alcohol. At one point in the evening, his companions covered Bires's face mask so that he could not see. The captain represented to him that he was two stories above the pavement and told him to jump into a firemen's net. The fall was actually only one foot, and Bires slipped and broke his leg in the "jump."
Without Bires's knowledge, the fire chief instructed the city clerk to apply for worker's compensation on his behalf. Eventually, Bires's medical expenses were paid and he received compensation for twenty weeks of temporary total disability. He cashed the checks.
Bires then sued the city, the fire department, the chief and various department employees for negligence. He also alleged a bad faith claim against the city's insurer.
All defendants moved for summary judgment dismissing the action. The trial court granted the motion, concluding that workers compensation was the exclusive remedy for Bires's injuries. The court also held that any challenge to his entitlement to such benefits must be raised before DILHR.
Bires argues on appeal that he is not subject to the exclusive remedy provisions of the act because he was not entitled to worker's compensation benefits.
The requirement of sec. 102.16, Stats., that any "controvers[ies] concerning compensation" must be submitted to DILHR is bolstered by the primary jurisdiction rule, which provides that "[w]hen an issue arises which fits squarely within the very area for which the agency was created, it would be logical to require prior administrative recourse before a court entertains jurisdiction." *895 Wisconsin Collectors Asso. v. Thorp Finance Corp., 32 Wis.2d 36, 44, 145 N.W.2d 33, 36 (1966).
We do not determine whether Bires's injury falls within the purview of the Worker's Compensation Act. That question is to be determined by DILHR. While referral to the appropriate agency under the primary jurisdiction rule is discretionary, Local 913 v. Manitowoc County, 140 Wis.2d 476, 483, 410 N.W.2d 641, 644-45 (Ct. App. 1987), we conclude that sec. 102.16, Stats., makes it mandatory with respect to questions concerning a previous entitlement to workers compensation. The trial court correctly held that Bires was required to submit the issue of compensation to DILHR. We disagree, however, that the action should have been dismissed.
When enforcement of a claim requires resolution of issues within the special competence of an administrative agency, the judicial process should be suspended pending referral of the issue to the administrative agency. Wisconsin Collectors Asso., 32 Wis.2d at 47, 145 N.W.2d at 38. We hold, therefore, that the trial court should have simply suspended Bires's action pending DILHR's resolution of the coverage issue. The trial court may, of course, set appropriate time limits within which Bires must apply to DILHR for a ruling.
Whether Bires's acceptance of benefits estops him from claiming he did not suffer a compensable injury is not ripe for determination, since DILHR has not yet decided whether the act applies.
By the Court. Judgment reversed and cause remanded for further proceedings consistent with this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920004/ | 91 B.R. 791 (1988)
In re Robert E. BORING, Karen E. Boring, Debtors.
Bankruptcy No. 2-85-01401.
United States Bankruptcy Court, S.D. Ohio, E.D.
April 27, 1988.
Robert H. Farber, Jr., Columbus, Ohio, for debtors.
F. Richard Heath, Hite & Heath, Utica, Ohio, for Cambridge PCA.
Frank M. Pees, Worthington, Ohio, Chapter 13 Trustee.
Michelle T. Sutter, Baker & Hostetler, Columbus, Ohio, for Trustee.
ORDER DENYING MOTION OF CAMBRIDGE PRODUCTION CREDIT ASSOCIATION FOR RELIEF FROM STIPULATION
R. GUY COLE, Jr., Bankruptcy Judge.
I. Preliminary Statement
This matter is before the Court upon the Motion for Relief from Stipulation ("Motion") filed by Cambridge Production Credit Association. An opposing memorandum was filed by Frank M. Pees, the standing Chapter 13 trustee ("Trustee"). The Court has jurisdiction over this case pursuant to 28 U.S.C. § 1334(b) and the General Order of Reference entered in this District. This is a core proceeding which the Court may hear and determine. 28 U.S.C. § 157(b)(1), and (2)(A). The following opinion shall constitute findings of fact and conclusions of law pursuant to Bankruptcy Rule ("B.R.") 7052.
II. Findings of Fact
At the August 21, 1987, hearing the Trustee, Cambridge Production Credit Association and debtors requested, through counsel, that they be allowed to submit this *792 contested matter for decision on the basis of certain stipulated facts. Upon the filing on August 28, 1987, of a document captioned "Stipulation of Facts," the Court deemed this matter to be fully submitted. The facts stipulated by the Trustee, Cambridge Production Credit Association and debtors are incorporated as factual findings in this matter and are reprinted verbatim below:
1. P.C.A. is the holder of a second mortgage on real property located at 10814 Township Road, 390B Northwest, Thorneville [sic], Ohio. The holder of the first mortgage against such property is Federal Land Bank of Louisville.
2. The schedules filed by debtors, Robert E. Boring and Karen E. Boring ("Debtors") on May 10, 1985, valued the real property at $70,000. P.C.A. filed an objection to this valuation.
3. On June 28, 1985, a meeting of creditors was held pursuant to 11 U.S.C. § 341. At that time, Debtors, P.C.A. and Trustee entered into a signed stipulation whereby all parties agreed that the value of the real property at the time of the filing of the bankruptcy petition was $83,000. At the time of filing of the petition, P.C.A. was owed $35,976.25 in principal.
4. A copy of the stipulation has been attached to this Stipulation of Facts as Exhibit A.P.C.A. and Trustee state that Exhibit A is a true and accurate copy of the stipulation executed by them either individually or through their attorney on June 28, 1985.
5. Debtors' plan was confirmed by order of this court entered November 27, 1985. Under the plan, the allowed secured claim of P.C.A. is to be paid at the rate of 100 cents on the dollar, together with interest thereon at the rate of 11 percent per annum. Any unsecured claim is to be paid at the rate of 25 cents on the dollar.
6. Debtors, P.C.A. and Trustee entered into a further stipulation on June 28, 1985, whereunder the value of the livestock and farm machinery subject to the security interest of P.C.A. was determined to be the sum of Twenty-One Thousand Six Hundred Forty Dollars ($21,640).
7. Based on the above stipulations, Trustee determined that the allowed secured claim of P.C.A. was the amount of $29,492.86. This figure was determined as follows:
$83,000.00 ....value of real property per
stipulation.
($8,300.00)....10 percent deduction for
cost of sale.
($66,847.14)....secured claim of Federal
Land Bank of Louisville,
first mortgage holder.
$ 7,852.86 ....equity in real property remaining.
This equity combined with the value of the livestock and farm machinery resulted in an allowed secured claim in the stated amount.
8. Trustee has paid P.C.A. in accordance with these valuations since November, 1985. This motion was filed by P.C.A. on September 29, 1986. Prior to the filing, P.C.A. had accepted and retained the sum of $8,846.37 pursuant to the stipulation and determinations set forth above. During the pendency of this motion, P.C.A. has received an additional $5,480.52 in partial satisfaction of its allowed secured claim.
9. In determining the amount of the claim which would be secured for purposes of distribution under debtors' plan, the Trustee deducted from the stipulated valuation for the real property a figure equivalent to 10% of said valuation. This deduction was made purusant [sic] to the decision in In re Paige [13 B.R. 713 (Bankr.S.D.Ohio 1981)].
10. The Trustee further deducted from the stipulated value of the real property all outstanding mortgages with a higher priority than P.C.A.'s.
11. Prior to entering into the Stipulation of June 28, 1985, P.C.A. had no knowledge that the Trustee would reduce the stipulated values by 10%.
12. At the time of entering into this Stipulation, P.C.A. understood that, by virtue of the stipulated amounts, it would be paid in full as a fully secured creditor at the 11% interest rate.
*793 13. The plan proposed by the debtors and confirmed by this Court did not provide for the sale of property for which a stipulation was made.
III. Conclusions of Law
This matter is before the Court in a rather unusual procedural posture. Neither the debtors nor the Trustee has objected to the proof of claim of Cambridge Production Credit Association ("Cambridge PCA"), filed as a secured claim in the amount of $35,976.25 (the "Claim"). The Trustee has, however, distributed monies pursuant to the confirmed plan to Cambridge PCA and other allowed claimants, but has treated Cambridge PCA as the holder of both a secured claim in the amount of $29,492.86 and an unsecured claim totaling $6,483.39. Although Cambridge PCA has never expressly agreed that any portion of its Claim is unsecured, nor has there been any judicial determination to that effect, the Trustee has relied upon a written Stipulation of Value of Secured Collateral ("Stipulation of Value") signed by these parties on June 28, 1985. Pursuant to that stipulation, the parties jointly agreed to the value of certain real and personal property (hereinafter sometimes collectively referred to as the "Collateral") in which Cambridge PCA claims a valid security interest. The collateral consisting of real property has been valued at $83,000. The personal property collateral is valued at $21,640, and consists of livestock ($7,200), and farm machinery and equipment ($14,440). Although the Stipulation of Value established the value of the Collateral in which Cambridge PCA claims an interest, it does not specify the standard of valuation (e.g. retail, wholesale, forced sale, liquidation, etc.), nor does it include any reference to, or make provision for, the specific amounts of Cambridge PCA's allowed secured or unsecured claims.
In calculating the amounts to be distributed to creditors under the plan, the Trustee deducted, as a projected sale cost of the real property subject to the mortgage liens of Cambridge PCA and Federal Land Bank of Louisville ("FLB"), ten percent of the stipulated value of the real property. The deduction of $8,300 as a sale cost leaves FLB, holder of a first mortgage on the real property, with a fully-secured claim in the amount of $66,847.14. The remaining equity in the real property $7,852.86 serves as partial security for the claim of Cambridge PCA. Thus, the Trustee has assumed that Cambridge PCA's allowed secured claim is $29,492.86, not $35,976.25 as filed, on the basis of the parties' agreement as to the value of the Collateral and a deduction of the projected costs of sale.
The Motion requests two alternative forms of relief. Cambridge PCA requests an order barring the Trustee from applying the ten percent deduction and requiring him to adjust all prior payments accordingly. Alternatively, the movant requests relief from the Stipulation of Value on the ground that it had no knowledge that the Trustee would deduct ten percent from the agreed-upon value of the real property.
As support for its Motion, Cambridge PCA contends that it was unaware at the time it entered into the Stipulation of Value that the Trustee would deduct ten percent as a cost of sale. In agreeing, through negotiations, to the values set forth in the Stipulation of Value, Cambridge PCA believed its Claim was fully secured. It is undisputed that, had the Trustee not deducted $8,300 as a sale cost, there would be $16,152.86, not $7,852.86, in equity left in the real property, more than enough to place Cambridge PCA in a fully secured in fact, oversecured position. Thus, the deduction of ten percent results in distributions by the Trustee to Cambridge PCA as if its Claim is secured in the amount of $29,492.86 and unsecured in the amount of $6,483.39. Cambridge PCA objects to such treatment of its Claim by the Trustee on the ground that holders of secured claims will be paid in full with interest, whereas holders of allowed unsecured claims will receive only a 25% dividend.
The primary issue before the Court is whether, under the facts of this case, it was proper for the Trustee to deduct ten percent from the stipulated value of the real property as a projected cost of sale. An analysis of the basis for deducting costs *794 of sale from the value of real property necessarily must begin with the conceptual approach which must be employed in determining the amount of a creditor's secured claim. Section 506(a)[1] clearly states that value should not be viewed as a static concept, but, instead, its determination depends upon the purpose of the valuation and of the proposed disposition or use of such property. Further, the legislative history accompanying § 506 indicates that the value of an asset may vary depending upon the context of the valuation hearing:
Value does not necessarily contemplate forced sale or liquidation value of the collateral; nor does it always imply full going concern value. Courts will have to determine value on a case-by-case basis, taking into account the facts of each case and the competing interests in the case.
H.R.Rep. No. 595, 95th Cong., 1st Sess. 356, reprinted in 1978 U.S.Code Cong. & Admin.News 5787, 6312.
As one Bankruptcy Court has recently noted, "[b]y what standard security interests in Chapters 11, 12 and 13 ought to be determined is controversial to say the least." In re Claeys, 81 B.R. 985, 990 (Bankr.D.N.D.1987). The present controversy stems, in large part, from the conflicting language of § 506(a). The Claeys court described this conflict in the following manner:
Whether a valuation is made without regard for potential costs of liquidation depends, it seems, upon the emphasis given to the first and second sentences of section 506(a). The first sentence, providing that the claim is secured to the extent of the value of the creditor's interest in the property, suggests that since it is the creditor's interest that is being valued and not the collateral itself, it should not make any difference whether the debtor is retaining the property. Yet, the language of the second sentence suggests that the proposed disposition or use of the collateral itself must be considered when determining that value.
81 B.R. at 990-991.
Given the seemingly inconsistent language of § 506(a), it is not surprising that divergent lines of authority have developed from judicial application of the valuation concepts embodied in the Code. A few courts have read the second sentence of § 506(a) to require use of a fair market value in Chapter 13 cases where the collateral will be retained by the debtor. In Matter of Crockett, 3 B.R. 365 (Bankr.N.D. Ill.1980), the Court, in evaluating the secured status of a creditor whose collateral (an automobile) was to be retained and used under debtors' Chapter 13 plan, stated:
Under a Chapter 13 plan the secured claim should be valued with due regard to the value of the property to the estate. "[T]he proposed disposition or use of such property" (Sec. 506(a)) in the instant case is for the debtors' retention and use. Therefore, the debtors cannot eat with the hounds and run with the hares. Seeking retention of the property, they cannot insist on liquidation values to be paid to the creditor in installments. The value of GMAC's secured claim under 506(a) is enhanced by the continued use of the collateral in effectuating the debtors' performance under the plan, which value must be reflected in distributions under the plan.
3 B.R. at 367. Thus, the Crockett court found that the creditor's secured claim should be determined by the fair market value of the automobile which, under the facts of that case, was found to be the wholesale value. See also, In re Courtright, 57 B.R. 495 (Bankr.D.Or.1986) (relying upon second sentence of § 506(a) to hold that, where debtors' plan contemplates retention of collateral, no deduction for *795 costs of foreclosure and resale should be made).
The clear weight of authority runs contrary to the Courtright and Crockett decisions, however. Most courts recognize that the debtor's proposed retention and use of collateral does not emasculate the fact that it is in the first instance the creditor's interest in the collateral that must be valued. See, e.g., In re Claeys, 81 B.R. at 991. Hence, in valuing a creditor's interest in property, bankruptcy courts attempt to determine what the creditor could recover if the collateral were disposed of in a commercially reasonable[2] manner. See, Virginia National Bank v. Jones (In re Jones), 5 B.R. 736, 739 (Bankr.E.D.Va. 1980); In re Klein, 10 B.R. 657, 660 (Bankr.E.D.N.Y.1981); Cohen v. Werner (In re Cohen), 13 B.R. 350 (Bankr.E.D.N.Y. 1981); In re Davis, 14 B.R. 226, 227-28 (Bankr.D.Me.1981); Parr v. First Alabama Bank (Matter of Parr), 30 B.R. 276, 277 (Bankr.N.D.Ala.1983); In re Frost, 47 B.R. 961, 964 (D.Kan.1985); In re Claeys, 81 B.R. at 990-92.
In In re Paige, 13 B.R. 713, 714 (Bankr. S.D.Ohio 1981) (Sidman, J.), this court followed the majority rule in focusing on the creditor's interest in the property when valuing a claim in a Chapter 13 case:
It is not the value of the property, per se, which is to be used in the determination of secured status, but rather it is the value of the creditor's interest in that property. While it may be conceded that the valuation standard in the Chapter 13 setting is not a forced sale or liquidation standard [see In re Damron, 8 B.R. 323 (Bkrtcy., S.D.Ohio 1980)], the Court must determine what a creditor would receive from the collateral upon its customary and commercially reasonable means of disposition. In re Klein, 10 B.R. 657, 7 B.C.D. 668 (Bkrtcy., E.D.N.Y. 1981). It is not, therefore, appropriate to merely take the fair value of property and assume that a creditor would receive that full amount upon disposition.
See also, In re Neal, 10 B.R. 535 (Bankr.S. D.Ohio 1981).[3] In determining the secured claim of a second mortgagee, the Paige court approximated the costs of sale at ten percent, based upon the customary seven percent real estate broker's commission in this geographic locale and various other costs which, hypothetically speaking, would approximate three percent. In reliance on Neal and Paige, this Court has routinely assessed a ten percent sale cost deduction, absent evidence establishing actual costs. See, In re Richardson, 82 B.R. 872, 873 (Bankr.S.D.Ohio 1987) (Sellers, J.). We hereby reaffirm our approval of Paige and Neal, at least as to the requirement that costs of sale should be deducted, and conclude that it is the creditor's interest in property which should be valued under § 506, not the value, per se, of the property itself. A valuation of the creditor's interest should, therefore, include a deduction for the hypothetical costs of sale, which this Court finds reasonable in the amount of ten percent.
In the case sub judice, the Court simply does not understand why the Trustee did not object, or has not objected, to the Claim of Cambridge PCA, or why he has attempted *796 to determine administratively the secured portion of the Claim. Usually, the propriety of deducting projected costs of sale comes before the Court upon an objection to a claim. Here, because there has been no objection, the amount and validity of the Claim are presumed by virtue of B.R. 3001(f). Thus, it would appear that, unless a party files a written objection, and prevails thereon, the Claim remains an allowed secured claim in the amount of $35,976.25. Assuming an objection is filed which proposes to reduce the secured portion of the Claim to $29,492.86 under the formulae stated herein, that matter, if contested, could be submitted on the facts already before the Court since the record is complete as to value of the Collateral.
Movant further believes that it should be accorded relief from the Stipulation of Value, presumably on the ground that it would not have agreed to the stipulated values had it been aware of the ten percent deduction. Where a stipulation has been entered into and filed, one of the parties will not be allowed to withdraw from the agreement, except by leave of court upon cause shown. Aurrecoechea v. Bangs, 110 U.S. 217, 3 S.Ct. 639, 28 L.Ed. 125 (1884). No such cause has been shown by Cambridge PCA. Further, Paige and Neal have provided for a ten percent cost-of-sale deduction in this Court since 1981. The fact that Cambridge PCA and its counsel were unaware of that case law is insufficient cause to grant movant relief from the Stipulation of Value. Finally, Cambridge PCA stated no fact which would demonstrate that it recently became aware of the Trustee's ten percent deduction. A delay of more than two years before seeking relief from a stipulation constitutes a waiver and laches, precluding any equitable relief this Court might otherwise order.
Based upon the foregoing, the Motion shall be, and the same is hereby, DENIED.
IT IS SO ORDERED.
NOTES
[1] (a) An allowed claim of a creditor secured by a lien on property in which the estate has an interest, . . . is a secured claim to the extent of the value of such creditor's interest in the estate's interest in such property, . . . and is an unsecured claim to the extent that the value of such creditor's interest . . . is less than the amount of such allowed claim. Such value shall be determined in light of the purpose of the valuation and of the proposed disposition or use of such property, and in conjunction with any hearing on such disposition or use or on a plan affecting such creditor's interest.
[2] The determination that the general standard of valuation in bankruptcy should be the most commercially reasonable disposition was made by Judge Cyr in the seminal case of In re American Kitchen Foods, Inc., 2 B.C.D. 715 (Bankr.D. Me.1976), which was decided under Chapter XI of the Act. In American Kitchen, the court compared the concept of a forced sale valuation against a standard based on commercial reasonableness (which was borrowed from Article 9 of the Uniform Commercial Code) and concluded that where a debtor continues to operate as a going concern and the collateral is used in connection with that operation, valuation of the collateral should be made in recognition of the "net recovery realizable from its disposition as near as may be in the ordinary course of business." Id. at 722.
[3] Legal commentators also have suggested that a court, in determining the value of a creditor's security interest, should ascertain what the creditor would receive upon a disposition of the collateral in a commercially reasonable manner. See, J. Queenan, Standards for Valuation of Security Interests in Chapter 11, 92 Com.L.J. 18, 29-33 (1987) (noting that in order to realize value in its collateral every creditor and, in fact, the debtor itself, will be required to sell it and incur the attendant costs of sale). Also, see generally, Fortgang and Mayer, Valuation in Bankruptcy, 32 U.C.L.A.L.Rev. 1061 (1985). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920022/ | 152 Wis.2d 17 (1989)
447 N.W.2d 66
IN RE the MARRIAGE OF: David HERDT, Petitioner-Respondent,
v.
Emma Lu HERDT, Respondent-Appellant.[]
No. 89-0300-FT.
Court of Appeals of Wisconsin.
Submitted on briefs July 14, 1989.
Decided August 8, 1989.
*19 For respondent-appellant there were briefs by Glen Cunningham of Marcovich, Cochrane, Milliken & Cunningham, Superior.
For petitioner-respondent there was a brief by Kathryn zumBrunnen of Robert zumBrunnen Law Office, Spooner.
Before Cane, P.J., LaRocque and Myse, JJ.
MYSE, J.
Emma Herdt appeals a judgment of divorce.[1] She contends that the trial court abused its discretion when it failed to award her any interest in David's pension as part of its property division, erred when it made her responsible for a debt that was not a marital obligation, and erred when it failed to consider federal statutes governing civil service retirement when awarding her a partial interest in survivor's benefits "which may be payable through petitioner's pension fund." We conclude that the trial court did not abuse its discretion when it made an unequal property division in lieu of maintenance; that the trial court's finding of fact with respect to partnership debts and assets was not clearly erroneous; and that the trial court's award of an interest in the survivor's benefit was proper. Accordingly, we affirm.
David and Emma Herdt had been married almost thirty years at the time of their divorce. The marital estate consisted primarily of two assets, the homestead *20 and David's civil service pension benefits. David is a retired postal carrier. Emma has been a full-time postal carrier since February, 1986. At present, David's gross income is $1,233 per month in pension benefits, augmented for eight months of the year by a monthly sum of $1,299 from employment as a boat rigger. Prior to the divorce proceedings, David owned and operated the Hometown Saloon in partnership with his daughter. A $6,900 loan from David's mother enabled him to start this business, which was not successful and has since ceased operation. Emma worked part time and was a homemaker in the early years of their marriage. Her current gross income earned as a postal carrier is $3,250 per month.
The trial court, after hearing testimony from an expert witness on the value of David's pension, ordered that:
1. Proceeds from the sale of the homestead are to be split evenly between the parties;
2. Emma is entitled to 50% of any survivor's benefits that may be payable through David's pension fund;
3. Emma is responsible for 50% of the $6,900 debt owed to David's mother; and
4. No maintenance is granted to either party.
Emma first contends that the trial court abused its discretion when it failed to award her any interest in David's pension as part of the property division. She cites Steinke v. Steinke, 126 Wis. 2d 372, 380, 376 N.W.2d 839, 843 (1985), modified per curiam, 127 Wis. 2d 444, 379 N.W.2d 853 (1986), which held that, as a matter of law, the value of a spouse's interest in a pension fund must be included in the property division. *21 Emma further relies on the language of Steinke that states: "[Prior case law] did not create a rule that pension rights may be excluded from the property division if they are included in the maintenance award ...." Id. at 382, 376 N.W.2d at 844.
[1, 2]
A division of property is within the sound discretion of the trial court and will not be disturbed on appeal in the absence of an abuse of discretion. Mausing v. Mausing, 146 Wis. 2d 92, 95, 429 N.W.2d 768, 770 (1988). To sustain a discretionary determination, the trial court's decision must be based upon the facts appearing in the record and in reliance on the applicable law. Id. (citing Hartung v. Hartung, 102 Wis. 2d 58, 66, 306 N.W.2d 16, 20 (1981)).
[3]
After reviewing the record, we conclude that the trial court did not exclude David's pension from its calculation of the marital estate, as was the case in Steinke. The court merely exercised the discretion given it under Wisconsin law to make an unequal division of the marital estate based on certain allowable considerations. Section 767.255, Stats., provides in pertinent part:
Property division. Upon every judgment of annulment, divorce or legal separation ... the court shall divide the property of the parties and divest and transfer the title of any such property accordingly. ... The court shall presume that all other property is to be divided equally between the parties, but may alter this distribution without regard to marital misconduct after considering:
. . . .
(8) The amount and duration of an order ... granting maintenance payments to either party, ... *22 and whether the property division is in lieu of such payments. (Emphasis supplied.)
See also sec. 767.26(3), Stats.
While Steinke mandates that pension funds be considered as part of the marital estate, it does not remove the trial court's discretion to make an unequal property division for good reason. Section 767.255(8) specifically permits the trial court to make an unequal distribution of marital assets based upon an award of maintenance. The trial court correctly concluded that it could make such an uneven division of marital assets in lieu of an award of maintenance payments that would otherwise be appropriate.
The trial court's reason for making an unequal division is supported by the record. Had the court awarded Emma an interest in David's monthly pension benefits, and then awarded David maintenance due to Emma's higher gross income, a circular flow of funds between the parties would have resulted. Wisconsin law does not require that the trial court ignore such practical realities when dividing the marital estate and awarding maintenance.
[4]
Next, Emma contends that the trial court erred when it made her responsible for a debt that was not a marital obligation. She contends that the $6,900 loan was a partnership debt, incurred by David alone. She further argues that the trial court erred when it assigned her responsibility for half of that debt, but did not award her any of the partnership's assets. The trial court specifically found that the loan from David's mother was a marital debt made during the marriage, and that "there was no marital asset stemming from the sale or operation of the Hometown Tavern." A valuation of the marital estate is a finding of fact that we will not upset unless *23 clearly erroneous. Liddle v. Liddle, 140 Wis. 2d 132, 136, 410 N.W.2d 196, 198 (Ct. App. 1987); sec. 805.17(2), Stats.
[5]
The record supports a conclusion that money from David's mother was a personal loan to David, causing the marital estate to incur a debt. With the loan proceeds, David entered into a business venture. Had the business produced a profit, David's percentage of that profit would have been part of the marital estate. In this case, however, the business failed. There were no assets to divide after the property was sold and the outstanding bills paid. We conclude that the trial court's findings of fact are not clearly erroneous.
[6]
Emma's third allegation of error is that the trial court failed to consider federal statutes governing civil service retirement when awarding her a partial interest in survivor's benefits "which may be payable through petitioner's pension fund." Emma initially contends that the trial court's award is defective because the court did not require David to make an election of survivorship benefits pursuant to 5 U.S.C.A. sec. 8341 (West Supp. 1989). She argues that "[i]f David makes no election, then there is nothing for Emma to have 50% of." In her reply brief, however, Emma notes that survivor reductions for a current spouse are automatic under 5 U.S.C.A. sec. 8416(a)(1) (West Supp. 1989), unless there is a waiver by both spouses at the time of retirement. This waiver never occurred, entitling Emma to her survivor reduction share and rendering moot her suggestion that she may be entitled to "50% of nothing."
[7]
Regardless, the trial court here was not required to become expert in the area of federal pension law prior to *24 making its award. It ordered that Emma "shall be entitled to 50% percent of any survivor's benefits which may be payable through [David's] pension fund with the U.S. Postal Service in the event [David] predeceases [Emma]." We conclude that this award can be construed only as an award of survivor's benefits if such benefits are available under the terms of the pension plan. While Emma may eventually have to undertake litigation in a federal court to determine whether survivorship benefits were waived at the time of David's retirement, the trial court did not err by refusing to take up these issues. For these reasons, the trial court's decision is affirmed.
By the Court.Judgment affirmed.
NOTES
[] Petition to review denied.
[1] This is an expedited appeal pursuant to Rule 809.17. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920046/ | 447 N.W.2d 17 (1989)
Leo Joseph SCHULTZ, Petitioner, Appellant,
v.
COMMISSIONER OF PUBLIC SAFETY, Respondent.
No. C5-89-619.
Court of Appeals of Minnesota.
October 24, 1989.
*18 Stephen R. O'Brien, Minneapolis, for appellant.
Hubert H. Humphrey, III, Atty. Gen. and Jeffrey F. Lebowski, Sp. Asst. Atty. Gen., St. Paul, for respondent.
Heard, considered and decided by NORTON, P.J., and LANSING and FLEMING,[*] JJ.
OPINION
WILLIAM J. FLEMING, Judge.
Appellant was arrested for driving while under the influence, and his driver's license was revoked for refusing testing pursuant to the implied consent law, Minn.Stat. § 169.123 (1988). He petitioned for judicial review, contending that because he told the officer he wanted to change his mind after first refusing, he did not refuse testing. The trial court sustained the revocation and Schultz appeals.
FACTS
On December 23, 1988, shortly after 1:00 a.m., Officer Clark Messenbrink placed appellant under arrest for driving while under the influence. Messenbrink transported appellant to the Brooklyn Center Police Station where the implied consent advisory was read to him. Appellant said he did not understand it. The advisory was re-read three times and appellant was allowed to read it himself. Appellant still indicated he did not understand it. Messenbrink asked if he would give a breath test and appellant refused. When asked why, he said "because I don't understand." After appellant refused, the officer noted a refusal on the implied consent form. Appellant then said "Wait, I want to change that." Messenbrink did not give appellant a breath test, but did give him some field sobriety tests.
Appellant's driver's license was revoked pursuant to the implied consent law for refusal. He petitioned for judicial review. The trial court found appellant refused testing, and that his apparent change of heart after having said no did not require the officer to give appellant a test. The referee recommended sustaining the revocation, and the trial court issued an order sustaining the revocation. Schultz appeals from the trial court's order.
ISSUE
Did appellant refuse testing within the meaning of the implied consent law, Minn. Stat. § 169.123 (1988)?
ANALYSIS
Any person who drives, operates, or is in physical control of a motor vehicle within Minnesota consents to a chemical test for the purpose of detecting the presence of alcohol. Minn.Stat. § 169.123, subd. 2(a). The legislature has allowed drivers to nonetheless refuse testing. Nyflot v. Commissioner of Public Safety, 369 N.W.2d 512, 517 (Minn.), appeal dismissed, 474 U.S. 1027, 106 S.Ct. 586, 88 L.Ed.2d 567 (1985). If a driver refuses testing, none shall be given, but the driver's license will be revoked for one year. Minn.Stat. § 169.123, subd. 4.
The supreme court has indicated that an expression of willingness to take a test after talking with an attorney is "an ineffective attempt to avoid the consequences of * * * refusal." Nyflot, 369 N.W.2d at 517 n. 4. It quoted State v. Palmer, 291 Minn. 302, 308-09, 191 N.W.2d 188, 191-92 (1971), for the proposition that "the testing officers should not be required `to await the driver's convenience of a different time or place' to submit to the statutory requirement."
This court addressed the issue of whether a person could withdraw a refusal most recently in Mossak v. Commissioner of Public Safety, 435 N.W.2d 578 (Minn.Ct. App.1989), pet. for rev. denied (Minn. April 10, 1989). In Mossak, the driver refused testing. Five or ten minutes later, after talking with a friend on the telephone, she asked to take the test, but was refused the opportunity. By this time, the officer had completed his paperwork and was on his way out of the building. Id. at 579. This *19 court held appellant's refusal was not cured by a later offer to take the test. We observed that:
[C]onsent for testing serves the evident purpose of the implied consent statute, and that law enforcement officers serve minimum public expectations by being flexible in disregarding a tentative refusal which is promptly withdrawn. Nevertheless, we find no basis for an appellate court mandate for flexibility such as would expunge appellant's refusal in the circumstances here.
Id. at 580.
In this case, appellant's change of mind was almost immediate, and was not separated from his initial response by any substantial time, place, or a telephone call to counsel or a friend. The only action the officer took was to mark a refusal on the implied consent form. The officer had not completed his processing of appellant's case, and, in fact, went on to administer field sobriety tests to appellant. Even under the apparent "bright line" rule in Minnesota, see Nyflot, 369 N.W.2d at 517, n. 4, we hold that under these facts, appellant did not refuse testing, and the breath test should have been administered.
DECISION
The order of the trial court sustaining the revocation is reversed.
Reversed.
NOTES
[*] Acting as judge of the Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 2. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614197/ | 939 So. 2d 159 (2006)
HOWARD MOSS, Appellant,
v.
PATRICIA L. MOSS Appellee.
Case Nos. 2D03-478, 2D03-2355 consolidated.
District Court of Appeal of Florida, Second District.
Opinion filed September 29, 2006.
Cynthia L. Greene of Law Offices of Greene, Smith & Associates, P.A., Miami; and David M. Wall of Law Offices of David M. Wall, Clearwater, for Appellant.
Joseph R. Park and Michael J. Park, Park and Ossian, P.A., Clearwater, for Appellee.
STRINGER, Judge.
On remand from the Florida Supreme Court, Howard Moss (the Husband) challenges the trial court's determination that he was not entitled to an award of attorney's fees against his former wife, Patricia Moss (the Wife). The supreme court did not make a decision in this case, but instead remanded for this court to reconsider its previous opinion in light of the supreme court's decision in Lashkajani v. Lashkajani, 911 So. 2d 1154 (Fla. 2005), concerning the validity and enforceability of prevailing party attorney's fee provisions in prenuptial agreements. We again affirm.
FACTS
Underlying Facts
The parties were married on February 14, 1993, in Reno, Nevada. At the time of the marriage, the parties were living in Illinois, where the Husband's family owned several successful currency exchange businesses. The Wife had worked for one of these businesses before the marriage. Because of the Husband's significant preexisting wealth and ownership interest in the family businesses, the parties signed a prenuptial agreement ("the Agreement") before the marriage. Paragraph 18 of the Agreement provided, in pertinent part:
If either party breaches any provision of this Agreement, the breaching party or his or her estate shall indemnify the other party and make the other party whole as if no such breach had taken place with respect to this Agreement. . . . Further, the breaching party or his or her estate shall be liable for any attorney's fees, costs and expenses incurred by the other party in attempting to enforce the provisions of this Agreement.
Shortly after the marriage, the parties moved to Florida where they together began to investigate starting a new currency exchange business. Ultimately, the parties opened five currency exchange businesses in the Tampa/St. Petersburg area. There was undisputed testimony at the dissolution hearing that the Wife worked with the Husband to find business locations, coordinate the construction of the buildings, hire and train employees, and manage the day-to-day operations of the businesses. Even though the Wife spent as many, if not more, hours actually working for the businesses than the Husband did, the Wife was not paid a salary nor was she considered an employee. Moreover, the businesses were incorporated and held solely by the Husband and his brother. Thus, the Wife worked more than full time for these postmarital businesses, but she was not compensated for her efforts either by salary or through ownership. Instead, the Husband told the Wife that once she determined what she wanted to do, he would "repay" her by setting her up in a business that she could leave to her children.
In February 2001, the Wife filed a petition for dissolution. In that petition, the Wife admitted that the Agreement was valid and enforceable. She sought the lump sum payment due to her under the Agreement, and she sought the two years of alimony payments provided for by the Agreement. In addition, the Wife sought an award of temporary alimony while the dissolution proceedings were pending and an award of rehabilitative alimony so that she could complete her training as a massage therapist. She also sought to be awarded a "special equity" in the Florida businesses based on the services she had provided to those businesses and the Husband's postmarriage promises to set her up in another business. In seeking the awards of rehabilitative alimony and "special equity," the Wife contended that these claims were not barred by the Agreement because they were simply not addressed anywhere in it. Thus, the Wife's claims dealt with the interpretation and scope of what she admitted was a valid and enforceable prenuptial agreement. The Wife also sought an award of attorney's fees and costs pursuant to section 61.16, Florida Statutes (2001).
In response to the Wife's petition, the Husband argued that the claims for rehabilitative alimony and a "special equity" were within the scope of the Agreement and were barred by it. He also argued that any award of temporary alimony should be offset against the lump sum amounts due to the Wife under the Agreement. He further contested the Wife's interpretation of the Agreement as it applied to the lump sum payment, claiming that the length of the marriage, and thus the corresponding payment, should be determined based on when the petition was filed rather than when dissolution was actually granted. Finally, the Husband sought an award of his attorney's fees pursuant to section 57.105, Florida Statutes (2001), contending that the Wife's claims were frivolous in light of the plain language of the Agreement.
During the course of the proceedings, the Wife's claim for rehabilitative alimony became moot. In the final judgment of dissolution, which was rendered December 20, 2002, the trial court found that the Wife's claim for "special equity" in the Florida businesses was barred by the Agreement. However, the trial court agreed with the Wife that the temporary alimony paid during the pendency of the dissolution case was not an offset to either the lump sum payment or the two years of alimony payments provided for by the Agreement. In addition, the trial court agreed with the Wife's interpretation as to the determination of the proper lump sum owed under the Agreement.
After the hearing on the petition for dissolution but before the final judgment of dissolution was actually entered, both parties set a hearing on their claims for attorney's fees and costs for December 6, 2002. When that hearing was scheduled, the only pending motion for attorney's fees filed by the Husband was his motion seeking fees pursuant to section 57.105. There was no pending motion seeking an award of attorney's fees pursuant to paragraph 18 of the Agreement, and no such claim had been made in the Husband's answer to the Wife's petition.
Shortly before the December 6, 2002, hearing, the Husband cancelled the portion of the hearing dealing with his motion. Thus, the December 6 hearing dealt solely with the Wife's motion for attorney's fees and costs. At the start of the December 6 hearing, the Husband told the court that he had cancelled the hearing on his motion because the final judgment had not yet been entered. The sum total of the Husband's discussion concerning his motion for fees was as follows:
The Respondent's Motion for Attorney's Fees, Your Honor, is really based upon two different issues that will really be resolved when a final judgment is entered that addresses the issues that were tried before the Court.
Until that final judgment is entered, the issues that we want to address regarding provisions in the prenuptial agreement relating to the breach of contract provision, which is I believe paragraph eighteen that we are asserting, there was a breach of the contract here in that the Petitioner sought an award of benefits or entitlements that were waived in the prenuptial agreement. And again, until the final judgment addresses and resolves those, we are not in a position to move forward with our Motion for Attorney's Fees.
The other motion or the other issue that was pending is a 57.105 motion. That addresses the same sort of issues, and as I'm sure the Court is well aware of, that section or that statutory provision really begins with a requirement that there be a prevailing party and we haven't reached that point yet.
That's why we cancelled our notice of hearing.
At the conclusion of the December 6 hearing, the parties agreed that they would schedule a continuation of the hearing on the motions for fees after the final judgment was entered.
After the December 6 hearing and the December 20 entry of the final judgment of dissolution, the parties scheduled the continuation of the hearing on their motions for attorney's fees for April 11, 2003. However, despite the Husband's stated intent at the December 6 hearing, the Husband never made any argument at the April 11 hearing that he was entitled to fees under paragraph 18 of the Agreement. Rather, the Husband's entire argument focused on section 57.105 issues.
After considering the arguments made by both parties, the trial court granted the Wife's motion for attorney's fees and costs and denied the Husband's motion. The trial court's ruling on the Husband's motion was limited to the statement that "[a]ny request for attorney's fees by the Former Husband is denied." The Husband subsequently appealed from both the final judgment of dissolution and the order on attorney's fees.
Initial Appeal
In his initial appeal to this court, the Husband challenged the trial court's finding concerning the length of the marriage for purposes of determining the proper lump sum to be awarded the Wife under the Agreement. The Husband also raised three issues concerning the attorney's fees awarded to the Wife. We affirmed the trial court on these issues. Moss v. Moss, 901 So. 2d 177 (Fla. 2d DCA 2005).
The Husband also argued that the trial court had erred in denying his request for attorney's fees. He argued that the Wife's claims were meritless and therefore that he was entitled to an award of fees pursuant to section 57.105. He also argued that the trial court had "disregarded" his argument that he was entitled to an award of fees under paragraph 18 of the Agreement. However, in his brief, the Husband recognized that this court had previously held that similar attorney's fee provisions in prenuptial agreements were unenforceable, and he asked this court to certify to the supreme court the same question that was certified in Lashkajani v. Lashkajani, 855 So. 2d 87 (Fla. 2d DCA 2003), concerning the enforceability of these types of provisions.
In our opinion, we affirmed the trial court's denial of the Husband's motion for attorney's fees under section 57.105. Moss, 901 So. 2d at 177. Per the Husband's request, we also certified the same question that we did in Lashkajani concerning the enforceability of prevailing party attorney's fee provisions in prenuptial agreements. In doing so, we neither considered nor decided the issue of whether the Husband's claim under paragraph 18 of the Agreement had any merit.
Supreme Court
The Husband appealed the certified question to the supreme court. Because the supreme court had recently quashed this court's decision in Lashkajani and because this case posed the same certified question, the supreme court accepted summary review, quashed our decision in Moss, and "remanded this case for reconsideration in light of this Court's decision in Lashkajani." Moss v. Moss, 914 So. 2d 942, 942 (Fla. 2005).
Current Appeal
On remand, the Husband makes the same arguments concerning whether the trial court properly awarded the Wife her attorney's fees pursuant to section 61.16. He also makes the same arguments concerning the merit of the Wife's positions in the trial court in an effort to assert that he is entitled to attorney's fees and costs under section 57.105.
On the issue of the Wife's alleged breach of the Agreement, the Husband again argues that the trial court "disregarded" his arguments concerning his entitlement to attorney's fees under paragraph 18 of the Agreement. The Husband asserts that he is entitled to "return to the trial court for a full consideration of this issue, specifically, whether the Wife's spurious 'special equity' claim below constituted a breach of the provisions of the parties' Prenuptial Agreement."
ANALYSIS
A. Husband's Claims Regarding Award of Wife's Attorney's Fees
In his brief on remand, the Husband raises the identical claims concerning the trial court's award of attorney's fees to the Wife that he raised in his initial appeal. In our earlier opinion, we specifically rejected these arguments and affirmed the award of attorney's fees to the Wife. Moss, 901 So. 2d at 177. The award of attorney's fees to the Wife was not the subject of the certified question to the supreme court and is not controlled in any fashion by the supreme court's decision in Lashkajani. Accordingly, our prior opinion stands as to the award of attorney's fees to the Wife.
B. Husband's Claim for Attorney's Fees under section 57.105
The Husband also raises the identical claims concerning his alleged entitlement to attorney's fees under section 57.105 that he raised in his initial brief. We again affirm on this issue as well.
The Husband essentially claims that the language of the Agreement is clear that the Wife was not entitled to any type of "special equity" in the Florida businesses. He contends that because the Agreement barred the Wife from having or obtaining "any right, title, claim in or to any assets [the Husband] may now own or subsequently acquire" and because she waived her right to any "marital or community property . . . in or to all property which [the Husband] may own or possess . . . at any time during the marriage," it was "crystal clear" that she had no right to any interest in the Florida businesses.
While admitting that the language itself seems clear, the Wife contends that it was not clear how that language applied to a business that the parties jointly started and operated postmarriage. She notes that paragraph 3 of the Agreement states that the Husband likewise waives his rights to "marital or community property . . . which [the Wife] owns or may own or possess, or in which she may have a beneficial interest . . . at any time during the marriage." Because she arguably had a beneficial interest in the Florida businesses that arose during the marriage by virtue of her efforts, she contends that the Agreement is not "crystal clear" on this point and that her resort to judicial interpretation was neither meritless nor frivolous.
While the trial court ultimately denied the Wife's "special equity" claim, it did so only after a lengthy discussion of the applicable law and how it related to the terms of the parties' Agreement. It distinguished several cases based on differences in the language between the prenuptial agreements presented in those cases and the parties' Agreement here. Given the cases cited and the trial court's discussion of the facts and law, we agree with the trial court that the Wife's claims were not so meritless or frivolous as to warrant an award of attorney's fees under section 57.105. Accordingly, we again affirm the trial court's denial of the Husband's motion for fees pursuant to section 57.105.
C. Husband's Claim for Attorney's Fees under the Agreement
Finally, the Husband claims that this court should reverse the trial court to the extent that it denied his claim for attorney's fees under paragraph 18 of the Agreement. Because the Husband never sought fees under paragraph 18 of the Agreement in the trial court, we affirm on this issue as well.
As a threshold matter, we note that we did not reach the merits of this issue in the initial appeal because our decision in Lashkajani held that prevailing party attorney's fee provisions in prenuptial agreements were not enforceable as a matter of law. Thus, we affirmed because, regardless of any possible merit to the Husband's argument, any claim was unenforceable. However, the supreme court subsequently decided that such prevailing party attorney's fee provisions may be enforceable. Lashkajani, 911 So. 2d at 1156. Accordingly, now that this threshold issue has been resolved, we must address the arguments raised by the Husband.
While the Husband repeatedly argues in this appeal that the trial court "disregarded" his arguments concerning his entitlement to fees under paragraph 18 of the Agreement, our review of the record shows that this issue is not preserved for our review. The supreme court has repeatedly held that "[i]n order to be preserved for further review by a higher court, an issue must be presented to the lower court and the specific legal argument or ground to be argued on appeal or review must be part of that presentation if it is to be considered preserved." Sunset Harbour Condo. Ass'n v. Robbins, 914 So. 2d 925, 928 (Fla. 2005) (quoting Tillman v. State, 471 So. 2d 32, 35 (Fla. 1985)); see also Dade County Sch. Bd. v. Radio Station WQBA, 731 So. 2d 638, 644 (Fla. 1999) (noting that generally a claim not raised in the trial court will not be considered on appeal); Mariani v. Schleman, 94 So. 2d 829, 831 (Fla. 1957) (holding that "matters not presented to the trial court by the pleadings and evidence will not be considered by this court on appeal"). This court has followed these rulings, stating:
It is the duty of a party to bring to the attention of the trial court his contentions relating to his claim for relief, and when he fails to do so, he certainly cannot assert that the trial judge was in error for failure to anticipate his desires.
Alliance for Conservation of Natural Res. in Pinellas County v. Furen, 122 So. 2d 51, 65 (Fla. 2d DCA 1960).
This principle has been applied when a party contends on review that the trial court denied relief that was otherwise available. For example, in Margolis v. Klein, 184 So. 2d 205 (Fla. 3d DCA 1966), the defendant sought review of an order dismissing her counterclaim and cross-claim and argued that the trial court should have granted her leave to amend. However, the appellate court noted that it could not "find any application to the trial court in the record to allow such an amendment." Id. at 206. The court noted that it is "elementary that before a trial judge will be held in error, he must be presented with an opportunity to rule on the matter before him." Id. Thus, because the defendant had never requested leave to amend, the appellate court refused to find that the trial court had erred by failing to grant her such leave.
As in Margolis, a careful review of the record in this case shows that the Husband never made any argument concerning his entitlement to fees under paragraph 18 of the Agreement in the trial court. The Husband never filed any pleading or motion seeking attorney's fees pursuant to any provision of the Agreement. The Husband never argued to the trial court that he was entitled to attorney's fees pursuant to any provision of the Agreement. While it is true that at the December 6 hearing the Husband told the trial court that he intended, at some later time, to pursue a claim for attorney's fees pursuant to paragraph 18 of the Agreement, he never actually did so. The Husband did not file a motion for fees pursuant to paragraph 18 after the December 6 hearing. Moreover, at the April 11 hearing, the Husband did not raise or argue the issue of his alleged entitlement to attorney's fees pursuant to any provision of the Agreement. In the absence of a motion or other pleading, the trial court should not be expected to remember that the Husband once stated an intent to seek fees pursuant to the Agreement. Further, even if the trial court remembered the Husband's reference to this intended claim, when the Husband failed to make any arguments concerning entitlement to fees under the Agreement at the hearing specifically held for that reason, the trial court was entitled to assume that the Husband had abandoned that position and had decided to seek fees pursuant solely to section 57.105.
Because the Husband never argued to the trial court that he was entitled to an award of attorney's fees pursuant to any provision of the Agreement, this issue was not preserved for appellate review and is not properly before this court on appeal. The trial court could not err by denying a claim that was never actually presented to it.
Affirmed.
WHATLEY and CASANUEVA, JJ., Concur.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919978/ | 447 N.W.2d 126 (1989)
ROCKPORT COMPANY, d/b/a Frye Boots, Appellant,
v.
WEDGEWOOD, INC., Appellee.
No. 88-1455.
Supreme Court of Iowa.
October 18, 1989.
*127 Theodore F. Sporer of Watson & Peterson, P.C., Des Moines, for appellant.
Michael F. Mumma and Rita Harmening Pedersen of Mumma & Pedersen, Jefferson, for appellee.
Considered by McGIVERIN, C.J., and HARRIS, SCHULTZ, NEUMAN and SNELL, JJ.
McGIVERIN, Chief Justice.
The Rockport Company sued Wedgewood, Inc., because of Wedgewood's failure to pay for shoes and other goods which Rockport sold and delivered to Wedgewood. Rockport's collection suit was aided by a prejudgment order for attachment under which some of Wedgewood's inventory was seized. Wedgewood's eventual counterclaims included a claim for wrongful attachment which is the subject of this appeal. The trial court entered judgment for Rockport on the debt and then ruled that Rockport had wrongfully attached Wedgewood's inventory. On the counterclaim, the court assessed actual and punitive damages against Rockport. Rockport appeals the court's judgment on the wrongful attachment counterclaim. We affirm and remand for fixing of attorney fees for Wedgewood.
I. Background facts and proceedings. The trial court's findings of fact are not disputed by either party.
The court found that at various times prior to the filing of this lawsuit, Wedgewood purchased a shoe inventory from Rockport on account. When Rockport filed its petition on August 5, 1987, Wedgewood owed Rockport $10,924.30. The debt was unsecured.
In May 1987, Wedgewood began receiving demand letters from Rockport's counsel regarding this debt. At about the same time, Wedgewood began negotiations to sell its assets to David Ewan. A final sale agreement was reached on July 24. On that day, Wedgewood's counsel sent out notices of the proposed bulk transfer to Ewan of all of Wedgewood's inventory, furniture, fixtures and equipment. Notice was given to all of Wedgewood's creditors, including Rockport, whose notice was mailed to its business address in Marlboro, Massachusetts. The notice apprised Wedgewood's creditors that the bulk transfer was to take place at 11:00 a.m. on August 6.
Rockport received the notice of bulk transfer on July 29. There is no claim that the notice did not conform to the requirements of Iowa's bulk transfer law. See Iowa Code §§ 554.6101554.6111 (1987) (Iowa version of Uniform Commercial CodeBulk Transfers). The notice stated that the estimated total of Wedgewood's debts was $427,005.58. The notice also stated that the total consideration to be received for the bulk transfer was $133,000; that First Interstate Bank of Urbandale had a security interest in Wedgewood's "collateral" and was to be paid *128 $118,000 from the proceeds of the transfer; and that the remaining $15,000 was to be paid to Merle Hay Mall of Des Moines, which had a landlord's lien on Wedgewood's property. The notice further stated that Wedgewood's debts would not, as a result of the transfer, be paid in full as they fell due. The court found that there was no suggestion of fraud in this transaction.
Rockport filed this collection suit on August 5, and obtained a prejudgment order for attachment of Wedgewood's property on the same day. Rockport's counsel did not perform a "U.C.C. search" to confirm that First Interstate Bank did, indeed, have a security interest in the assets being transferred. See Iowa Code § 554.9407. The ground alleged for the attachment was that contained in Iowa Code section 639.3(10) (1987):
That the defendant is about to convert the defendant's property or a part thereof into money for the purpose of placing it beyond the reach of the defendant's creditors.
At approximately 10:00 a.m. on August 6, a Polk County deputy sheriff, executing the writ of attachment, seized 452 pairs of shoes from Wedgewood's store at Merle Hay Mall. The shoes were returned the next day.
The parties agree that the seizure of Wedgewood's inventory pursuant to the prejudgment order for attachment prevented the August 6 closing of the bulk transfer between Wedgewood and Ewan. The transfer finally was consummated on August 10, but Wedgewood received $36,000 less than it was to receive under the original agreement. The reduction in the sales price of the business was attributed to damage to Wedgewood's trade name which occurred from the seizure of its inventory. The trial court found that the use of Wedgewood's trade name had been included in the original agreement between Wedgewood and Ewan.
Wedgewood timely filed its answer to Rockport's petition. The answer included counterclaims for wrongful attachment, abuse of process, and tortious interference with a contractual relationship, and sought actual and punitive damages from Rockport.
This law action proceeded to trial before the court. The court entered judgment for Rockport on its petition for the debt and then entered judgment for Wedgewood on its wrongful attachment counterclaim, assessing $36,000 actual damages plus reasonable attorney fees against Rockport. The court also awarded Wedgewood $1,000 exemplary damages, finding that Rockport's actions were taken in reckless disregard of Wedgewood's rights. The court did not address Wedgewood's counterclaims for abuse of process and tortious interference with a contractual relationship.
Rockport appeals from the court's judgment on the wrongful attachment counterclaim.[1]
II. Wrongful attachment and the trial court's order. An attachment may be said to have been sued out wrongfully where the grounds upon which the plaintiff predicates its right to the attachment are false. The burden of proof is on the counterclaiming defendant to show that the alleged grounds for attachment are not true and that the plaintiff had no reasonable grounds to believe otherwise. Moore v. Altmyer, 199 Iowa 368, 373, 202 N.W. 214, 216 (1925); Iowa Code §§ 639.14 and 639.15.
In Iowa, the recognized grounds for attachment are specified by statute. Iowa Code section 639.3(10) provides that one ground for attachment is "[t]hat the defendant is about to convert the defendant's property or a part thereof into money for the purpose of placing it beyond the reach of the defendant's creditors." In this case, Rockport obtained a prejudgment order for attachment on this ground after learning that Wedgewood intended to convert its *129 assets into money through a bulk transfer under Iowa Code sections 554.6101554.6111, and to pay its secured creditors from the proceeds in preference over Rockport, an unsecured creditor. Essentially, Wedgewood announced its intention to prefer its secured creditors over its unsecured creditors after the liquidation of its business assets.
Rockport first contends that the trial court erroneously engrafted a "fraudulent intent" requirement onto section 639.3(10). Because there is no suggestion of fraudulent intent in this case, the argument goes, the court necessarily concluded that the attachment obtained pursuant to section 639.3(10) was wrongful, based upon its erroneous interpretation of that statute.
Rockport further contends that but for the error in engrafting a "fraudulent intent" requirement onto section 639.3(10), the court would have found that its attachment of Wedgewood's inventory was justified, because Wedgewood clearly was converting its assets into money and admitted to intending to place the money beyond the reach of Rockport by paying its secured creditors. Thus, Rockport argues that the requirements of section 639.3(10) were satisfied in this case, so that its attachment was not wrongful and the trial court erred in finding otherwise.
Rockport's first contention is not supported by the record. The trial court did not engraft a fraudulent intent requirement onto section 639.3(10). In its ruling, the court wrote:
[T]he purpose of the bulk transfer was to liquidate Defendant's business assets to pay its secured creditors, not to place the assets beyond the reach of its creditors. This is apparent from the Notice of Bulk Transfer that Plaintiff received. The alleged ground for attachment is not true. Nor did the Plaintiff have a reasonable ground to believe otherwise. The mere bulk transfer of a business does not warrant an attachment unless the transfer was made with fraudulent intent.... No evidence of fraudulent intent appears in the record. The Court concludes Plaintiff's Writ of Attachment was sued out wrongfully.
The first sentence of the quoted passage shows that the court's conclusion was based on the fact that Wedgewood did not intend to place the money beyond the reach of its creditors, but was going to pay its secured creditors. The last part of the quoted passage simply explains why the court concluded that Rockport had no reasonable grounds to believe that its attachment was justifiedthat is, because there was no evidence of fraud. Rockport had no reason to believe that Wedgewood was not going to carry out its announced intention to pay other creditors. If fraud was, in fact, reasonably suspected, then a bulk transfer notice would warrant attachment to prevent consummation of the transfer under Iowa Code section 639.3(5). See Iowa Code § 639.3(5) (attachment available where "the defendant is about to dispose of the defendant's property with intent to defraud the defendant's creditors"). We conclude that the trial court did not erroneously engraft a fraudulent intent requirement onto section 639.3(10).
III. Wrongful attachment, preferential transfers and Iowa Code section 639.3(10). The question remaining is whether the fact that Wedgewood announced its intention to convert its assets into money through a bulk transfer and then prefer its secured creditors over Rockport is justification for suing out an attachment under section 639.3(10).
Rockport points out that section 639.3(10) does not require that a party against whom an attachment is sought place the property or proceeds beyond the reach of "all" of its creditors. What Rockport ignores, however, is that neither does section 639.3(10) state that an attachment is available where the party against whom it is sought is placing the property or proceeds beyond the reach of "some" of its creditors, or beyond the reach of "the creditor who is seeking the attachment." Rockport's "argument from omission" does not advance its position in this case, because the implication of the omission could cut either way. The statute simply does not address the *130 situation we are faced with, i.e., where the party against whom the attachment is sought is placing the property or proceeds beyond the reach of some creditors by paying other bona fide creditors.
Rockport contends that its position is supported by language in Klooster v. North Iowa State Bank, 404 N.W.2d 564 (Iowa 1987). In that case, the bank obtained an ex parte order for attachment of the Kloosters' swine herd, which was collateral for debts the Kloosters owed the bank. Id. at 566. The ground alleged for attachment was that set forth in section 639.3(10). Id. After the bank sold the swine herd without the Kloosters' knowledge, Kloosters sued the bank on numerous theories, including wrongful attachment. Id. The evidence tended to show that Kloosters had been selling parts of their swine herd, in which the bank held a security interest, without turning the proceeds over to the bank. Id. at 568. The jury returned substantial verdicts against the bank on all counts. Id. at 566. On appeal, we reversed and held that the bank's motion for a directed verdict on the wrongful attachment claim should have been granted. Id. at 568.
Rockport seizes upon language in Klooster that states:
If [an unsecured creditor] has reasonable grounds to believe that a debtor is placing assets beyond the creditor's reach, enough of the debtor's assets to satisfy the creditor's claim may be placed in custodia legis pending trial of the action on the unsecured account.
Id. As Rockport points out, this language speaks in the singular. Nothing in the quoted passage implies that the debtor need be placing the assets beyond the reach of all of its creditors. In addition, some of the court's language suggests that the reversal of the Klooster wrongful attachment judgment could have been based upon section 639.3(10) as an alternative holding ("We need not, however, turn our decision entirely on the reasonableness of the bank's belief [that the Kloosters were putting assets beyond the reach of their creditors]."). Id. (emphasis added).
Nevertheless, the language relied upon by Rockport is clearly dicta. Our holding on the issue of wrongful attachment was stated later in the opinion, where we said:
We agree that under this set of circumstances the bank was entitled to possession of the hogs either by self-help, where permissible under section 554.9503, or by appropriate legal process as authorized in section 554.9501(1). Because the Kloosters' wrongful attachment claim is based upon actions of the bank in wrongfully dispossessing them of the hogs, it is lacking in legal merit. The bank was legally entitled to take possession of the hogs either personally or by employing legal process to place the collateral in custodia legis.
Id. (emphasis added). Thus, we held that the bank, as a secured creditor, was entitled to seize the hogs under chapter 554, regardless of whether it was reasonable in its belief under section 639.3(10) or entitled to an attachment under chapter 639. Chapter 554 clearly provides that a secured creditor may take possession of its collateral merely upon the debtor's default whether by judgment, foreclosure, other judicial procedure or self-help. See Iowa Code §§ 554.9501 and 554.9503 (1987).
In addition, Klooster is distinguishable from the present case on its facts. Unlike this case, Klooster did not involve a debtor reducing its property to money with the announced and uncontroverted intention of paying its secured creditors over its unsecured creditors; rather, Klooster involved a debtor refusing to pay a secured creditor from the proceeds of that creditor's collateral. In addition, the bank in Klooster, a secured creditor, was attaching its own collateralcollateral it had the right to take possession of immediately upon mere default. In the present case, Rockport is an unsecured creditor that attached collateral it knew, or should have known, belonged to Wedgewood's secured creditors.
As noted before, section 639.3(10) is silent as to whether it authorizes an attachment when the party against whom the attachment is sought is placing property or proceeds beyond the reach of "all" of its creditors, "some" of its creditors, or "the creditor who is seeking the attachment." *131 The statute is ambiguous, and this case turns on its construction.
The substance of the transaction which Rockport objected to in this case is that of a proposed non-fraudulent preferential transfer outside of bankruptcy. We believe that section 639.3(10) should not be construed to authorize an attachment under these circumstances.
Allowing an attachment here would conflict with the well-established principle that outside of bankruptcy and in the absence of fraud, even an insolvent debtor may prefer one creditor over another. See, e.g., Andrew v. Nabholz, 219 Iowa 75, 76, 257 N.W. 587, 588 (1934). We are not inclined to adopt a construction of section 639.3(10) that would allow a disappointed unsecured creditor to attach its debtor's assets merely because the debtor was paying another bona fide creditor.
The fact that this preferential transfer involved a bulk sale does not change the general rule allowing a debtor to prefer one creditor over another. The general assembly rejected that option when it rejected section 6-106 of the Uniform Commercial Code's bulk transfer law. See U.C.C. § 6-106 (1962); cf. Iowa Code § 554.6106 (1987) (reserved section indicating that Iowa omitted, and still has not adopted, section 6-106 of the Official Text of the 1962 Uniform Commercial Code, otherwise enacted into Iowa law by 1965 Iowa Acts ch. 413). Section 6-106 would have imposed a duty on bulk transferees to ensure that the proceeds of the bulk transfer were applied to pay the transferor's debts. U.C.C. § 6-106(1) (1962). Significant for our purpose here is the fact that the rejected section also would have provided that: "If the consideration payable [for the bulk transfer] is not enough to pay all of the said debts [of the transferor] in full distribution shall be made pro rata." U.C.C. § 6-106(3) (1962). Thus, the legislature must have contemplated that a bulk transfer might not satisfy all of a transferor-debtor's creditors; yet the legislature chose not to step in and require that all creditors be treated equally in such a case.
Furthermore, it would be particularly incongruous with other Iowa law to hold that an attachment was justified by the threatened preferential transfer in this case, given the fact that the assets seized were fully encumbered in favor of creditors other than Rockport. Under Iowa law, a security interest in collateral continues in the proceeds of the collateral. Iowa Code § 554.9306. Moreover, an unsecured creditor who attaches a debtor's personal property which is security for another debt must pay the secured creditor the amount of the secured debt or post security therefor within ten days of the levy. See Iowa Code §§ 626.34 and 639.40. Simply stated, where there is no suggestion of fraud, an unsecured creditor who attaches a secured creditor's collateral to delay its sale for the benefit of the secured creditor gains nothing; the only effect of the attachment is to inconvenience the other parties involved.
The result urged by Rockport would also appear to conflict with the intent of the bulk transfer law. Were we to hold that a mere bulk transfer notice constitutes grounds for attachment under section 639.3(10), then bulk transfers of even fully encumbered property would be subject to the interference of unsecured creditors. Yet Iowa's bulk transfer law exempts from its provisions transfers in settlement or realization of a lien or security interest. Iowa Code § 554.6103(3) (1987). Thus, it appears that Wedgewood might have lawfully effected this entire transaction without giving any notice of the intended bulk transfer whatsoever. See Ouachita Elec. Coop. Corp. v. Evans-St. Clair, 12 Ark. App. 171, 672 S.W.2d 660 (1984) (transfer of encumbered assets to party other than the secured party held within U.C.C. § 6-103(3) where result of transaction was to settle security interest and no harm was done to position of any unsecured creditor); Techsonic Indus., Inc. v. Barney's Bassin' Shop, Inc., 621 S.W.2d 332 (Mo.Ct.App. 1981) (U.C.C. § 6-103(3) does not require that the transfer in settlement of a security interest be made to the secured party); but see Starman v. John Wolfe, Inc., 490 S.W.2d 377 (Mo.Ct.App.1973) (to be exempt from Article 6 under U.C.C. § 6-103(3), transfer should be made to holder of security interest and not to a transferee for the benefit of the security interest holder); see *132 also Stone's Pharmacy, Inc. v. Pharmacy Accounting Management, Inc., 812 F.2d 1063 (8th Cir.1987) (recognizing split of authority).
We conclude that the fact that a debtor announces its intention to convert its assets to money through a bulk transfer and then prefer its secured creditors over its unsecured creditors in distribution of the money is not justification for suing out an attachment under Iowa Code section 639.3(10). The language in Klooster implying the contrary is not controlling. In the case of ordinary preferential transfers, the debtor is not placing its assets beyond the reach of its creditors; it is simply preferring some creditors over others. Outside of bankruptcy and in the absence of fraud, our law allows this. The trial court was correct in so holding.
The judgment of the trial court is affirmed. Because Rockport's appeal was taken before the trial court had determined the amount of its award to Wedgewood for reasonable attorney fees incurred there, we remand for that determination.
AFFIRMED AND REMANDED.
NOTES
[1] Rockport does not contest the amount of actual and punitive damages awarded by the trial court on the wrongful attachment counterclaim; the sole issue on appeal is whether the attachment was wrongful. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614202/ | 939 So. 2d 881 (2006)
Basil Timothy CASE
v.
ALABAMA STATE BAR.
1041325.
Supreme Court of Alabama.
March 31, 2006.
*882 William J. Baxley, Joel E. Dillard, and Donald R. James, Jr., of Baxley, Dillard, Dauphin, McKnight & Barclift, Birmingham, for appellant.
J. Anthony McLain, gen. counsel, and Samuel S. Partridge, asst. gen. counsel, Alabama State Bar, for appellee.
SEE, Justice.
Basil Timothy Case appeals the circuit court's dismissal on the basis of lack of jurisdiction of his petition against the Alabama State Bar seeking declaratory and injunctive relief. We dismiss his appeal.
On September 27, 2004, the Alabama State Bar petitioned the Disciplinary Commission of the Alabama State Bar to enter an order temporarily suspending Case's right to practice law based on 10 pending complaints against him and on his history of disciplinary proceedings with the Bar. On the same day, the Disciplinary Commission granted the State Bar's petition and entered an order temporarily suspending Case's right to practice law. Case learned about the suspension when the General Counsel of the State Bar faxed him a copy of the order. Case immediately petitioned the Disciplinary Commission to dissolve the order of interim suspension; the Disciplinary Commission denied Case's petition. The day after the Disciplinary Commission entered its order, the Lauderdale Circuit Court appointed a trustee to inventory Case's files, to manage his trust accounts and fiduciary accounts, and to protect the interests of his clients.
On April 8, 2005, now represented by counsel, Case petitioned the Disciplinary Board of the State Bar to dissolve or terminate his interim suspension. On April 18, 2005, the Disciplinary Board held a hearing. At the hearing, the Bar sought to introduce evidence concerning additional complaints it said it had received against Case after the September 27, 2004, order temporarily suspending Case from the practice of law. The hearing officer continued the hearing to determine the admissibility of the evidence of the additional complaints. On April 26, 2005, the hearing officer entered an order limiting the scope of evidence to only those complaints that were the basis of the September 27, 2004, petition for interim suspension. On the same day, the State Bar petitioned the Disciplinary Commission, pursuant to Rule 20(a), Ala. R. Disc. P., for an order temporarily suspending Case from the practice of law based on the additional complaints it had received against Case after September 27, 2004. On April 27, 2005, the Disciplinary *883 Commission granted the State Bar's petition and entered another order temporarily suspending Case from the practice of law. The State Bar also moved the Disciplinary Board to "dismiss or dissolve" the September 27, 2004, order of interim suspension. The Disciplinary Board granted the State Bar's motion and dissolved the order of interim suspension the Disciplinary Commission had entered on September 27, 2004.
On May 6, 2005, Case petitioned the Montgomery Circuit Court, seeking declaratory and injunctive relief from the order of interim suspension. Judge Charles Price issued a temporary restraining order ("TRO") that essentially prohibited the State Bar from proceeding with any disciplinary action against Case while the TRO was effective. On May 10, 2005, the State Bar petitioned this Court for a writ of mandamus directing Judge Price to vacate the TRO, arguing that the circuit court lacked jurisdiction to interfere in the disciplinary process. On May 16, 2005, the TRO expired as a matter of law. On June 3, 2005, Judge Truman M. Hobbs, Jr., to whom the case was assigned, dismissed Case's petition for declaratory and injunctive relief, finding that the court lacked jurisdiction to hear matters involving lawyer discipline. The State Bar then moved this Court to dismiss its mandamus petition because the circuit court's decision removed the basis for the State Bar's mandamus petition; on June 8, 2005, this Court, by an unpublished order, granted the State Bar's motion to dismiss.
Case appealed the circuit court's dismissal of his petition for declaratory and injunctive relief to this Court, arguing that the circuit court had jurisdiction to hear his case. While his appeal was pending, Case also petitioned this Court for a writ of mandamus directing the State Bar to set aside its April 27, 2005, order of interim suspension pending further orders of this Court, or, alternatively, to dissolve the order of interim suspension, under our supervisory jurisdiction over proceedings before the State Bar. We held that the ex parte interim suspension pursuant to Rule 20(a), Ala. R. Disc. P., had deprived Case of due process; we therefore granted Case's mandamus petition and directed the Disciplinary Board to dissolve the April 27, 2005, order against Case.[1]Ex parte Case, 925 So. 2d 956, 964 (Ala.2005).
On October 14, 2005, when we decided Case's mandamus petition, the briefing of Case's appeal had not been completed. Case submitted his reply brief in his appeal on October 18, 2005. In his reply brief, Case admits that our decision on his mandamus petition
"mooted most, but not all constitutional issues in dispute between these parties. The [State] Bar's public notice to Case, via the Florence Times Daily, in response to this Court's four day old decision, makes it clear that it now intends to `pursue 53 complaints against Case and seek to have him resuspended.' (Florence Times Daily, October 15, 2005.) It also makes it clear that this appeal is not moot. In this appeal, this Court is invited to determine the jurisdiction of the Montgomery County Circuit Court to hear and determine Case's remaining constitutional claims against the [State] Bar."
Case's reply brief, p. 1.
Because our decision in Ex parte Case appeared to have mooted all of the issues that Case argues on his appeal, we ordered Case to show cause why this appeal should *884 not be dismissed as moot. In response to our show-cause order, Case states:
"This action is not moot. The Alabama State Bar has had no contact with [Case] or his counsel since oral argument [in Ex parte Case], at which time it represented to this court and to him that it planned to prosecute numerous cases against him. . . .
". . . .
"Without a clarification and determination of the jurisdictional questions before this Court [on appeal] questions not decided by this Court [in the mandamus proceeding] [Case] will be forced to seek mandamus review in this Court, rather than an initial review by the Circuit Court for Montgomery County, if the [State] Bar makes good on its threats made at oral argument in [Ex parte Case]."
(Emphasis added.)
Case's appeal is from the circuit court's dismissal of his petition for declaratory and injunctive relief from the Disciplinary Commission's April 27, 2005, order temporarily suspending him from the practice of law. He does not point to any specific claim in that petition that was not mooted by our decision in Ex parte Case. Our resolution of Ex parte Case, which ordered the Disciplinary Board to dissolve the April 27, 2005, order, effectively resolved the controversy that is the basis of this appeal. Therefore, Case's appeal is moot.
"A moot case or question is a case or question in or on which there is no real controversy; a case which seeks to determine an abstract question which does not rest on existing facts or rights, or involve conflicting rights so far as plaintiff is concerned." American Fed'n of State, County & Mun. Employees v. Dawkins, 268 Ala. 13, 18, 104 So. 2d 827, 830-31 (1958). An action that originally was based upon a justiciable controversy cannot be maintained on appeal if the questions raised in it have become moot by subsequent acts or events. See Employees of Montgomery County Sheriff's Dep't v. Marshall, 893 So. 2d 326, 330 (Ala.2004) ("This Court will dismiss an appeal from the denial of an injunction when an event occurring after the denial of the injunction renders the appeal moot.").
In his reply brief, Case invites this Court to "determine that the Circuit Court for Montgomery County is a far better qualified and more judicious forum for original jurisdiction over these constitutional questions than is the Bar itself." Case's reply brief, p. 6. Thus, Case asks the Court to determine whether he may take the Disciplinary Commission's decision to the circuit court if the State Bar prosecutes and if the Disciplinary Commission rules against him. Case argues that his appeal is not moot because "there remains an issue underpinned by the Bar's unknown prosecutorial intentions and the jurisdiction of the Montgomery County Circuit Court to review its misconduct, which prevents this appeal from being moot."
Case is substantially arguing that, even though the claims he asserted in his petition for declaratory and injunctive relief are moot, the State Bar has indicated that it may prosecute complaints against him in the future, and he would like to know where to take an adverse decision on such a prosecution. Whether the State Bar prosecutes Case and, if it does, whether the Disciplinary Commission rules against him are matters that may or may not occur at some time in the future. Matters that may or may not occur in the future are not matters in controversy. See Baldwin County v. Palmtree Penthouses, Ltd., 831 So. 2d 603, 605 (Ala.2002) ("Matters *885 that may or may not occur in the future do not present an existing controversy to a plaintiff. . . . Therefore, a plaintiff fails to invoke the jurisdiction of a court by alleging facts that merely anticipate a possible controversy in the future.").
Furthermore, because the facts necessary to create an actual controversy have not materialized, that is, the State Bar has not prosecuted Case for additional complaints and the Disciplinary Commission has not ruled against Case, Case is essentially asking this Court to render an advisory opinion. "It is well settled that the judiciary of Alabama is not empowered `"to decide moot questions, abstract propositions, or to give advisory opinions, however convenient it might be to have these questions decided for the government of future cases."'" Ex parte Connors, 855 So. 2d 486, 488 (Ala.2003) (quoting Stamps v. Jefferson County Bd. of Educ., 642 So. 2d 941, 944 (Ala.1994)). See also Smith v. Alabama Dry Dock & Shipbuilding Co., 293 Ala. 644, 651, 309 So. 2d 424, 429 (1975) ("It has long been the law of this State that courts will not decide moot, abstract or hypothetical questions or render purely advisory opinions.").[2]
The claims Case presented to the circuit court in his petition for declaratory and injunctive relief are moot; his argument that this Court should nonetheless decide whether the circuit court will have jurisdiction in a case that may or may not be brought against him by the State Bar in the future is a request for an impermissible advisory opinion. Accordingly, we dismiss Case's appeal.
APPEAL DISMISSED.
NABERS, C.J., and LYONS, HARWOOD, WOODALL, STUART, SMITH, BOLIN, and PARKER, JJ., concur.
NOTES
[1] We also, by separate order issued on the day we released our opinion in Ex parte Case, amended Rule 20(a) and Rule 20(d) of the Alabama Rules of Disciplinary Procedure.
[2] The only exception to this rule is that this Court is authorized by statute in limited circumstances to issue advisory opinions in response to a request from the governor or the legislature. See § 12-2-10, Ala.Code 1975 ("The Governor, by a request in writing, or either house of the Legislature, by a resolution of such house, may obtain a written opinion of the justices of the Supreme Court of Alabama or a majority thereof on important constitutional questions."). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614205/ | 939 So. 2d 1165 (2006)
Courtney DEMPSEY, Appellant,
v.
STATE of Florida, Appellee.
No. 4D04-4380.
District Court of Appeal of Florida, Fourth District.
October 25, 2006.
*1166 Tara A. Finnigan, West Palm Beach, for appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, and Laura Fisher Zibura, Assistant Attorney General, West Palm Beach, for appellee.
KLEIN, J.
Appellant and a co-defendant were convicted of attempted murder of a police officer, four counts of robbery with a firearm, and attempted robbery with a firearm. The written instructions given to the jury stated that the state had to prove that a co-defendant, James Womack, "and/or Courtney Dempsey" committed the elements of the crimes. This was apparently an inadvertent error because appellant had objected to the "and/or" language, and the court had modified the oral instructions so that they did not suffer from this infirmity. Because we conclude that the written "and/or" instructions were error, we reverse for a new trial.
The evidence showed that appellant and Womack committed an armed robbery of several victims and, during a subsequent high speed chase, shots were fired at an officer who was pursuing them. It appeared from the evidence that the shots were fired from the passenger side of the vehicle by Womack while appellant was driving. Appellant and Womack were tried together, before separate juries. During the jury instruction conference the court agreed not to use "and/or" instructions, after an objection was made; however, the written instructions given to the jurors were not modified. For example, the court gave the following written instruction pertaining to attempted first degree murder with a firearm to the jurors:
Before you can find the defendants guilty of Attempted First Degree Murder with a Firearm the State must prove the following four elements beyond a reasonable doubt:
1. James Womack and/or Courtney Dempsey did some act intended to cause the death of Leif Broberg that went beyond just thinking or talking about it.
2. James Womack and/or Courtney Dempsey acted with premeditated design to kill Leif Broberg.
3. The act would have resulted in the death of Leif Broberg except that someone prevented James Womack and/or Courtney Dempsey from killing Leif Broberg or they failed to do so.
4. In the course of committing the Attempted First Degree Murder, James Womack and/or Courtney Dempsey carried a firearm . . .
The written instructions for all of the other crimes charged also contained the "and/or" language.
Before we reach the merits we address the preservation issue. Appellant *1167 has assumed that his trial counsel, Ms. Whitfield, failed to object to the "and/or" instructions and argues that the error is fundamental. The record, however, is to the contrary. The objection was first raised by counsel for co-defendant Womack, who explained why "and/or" instructions were incorrect. He then stated "I'm sure that Ms. Whitfield would like that for her client as well." At that point the court interrupted with a question and, for the moment, disagreed with counsel. Several pages later in the transcript Ms. Whitfield pointed out to the court that it would be convenient to instruct as to each defendant separately because there were separate juries. The court apparently decided after that comment to not use "and/or" instructions. Although the transcript does not show Ms. Whitfield expressly agreeing with her co-counsel initially, her silence, after co-counsel explained that he was certain he was speaking for her client as well as his, was sufficient to preserve the issue for both defendants. Unfortunately, as we noted earlier, the court changed only the oral instructions.
Under an "and/or" instruction the jury is informed that if defendant A has committed all the elements of the crime, B is guilty without having committed any elements. Or the jury could find both defendants guilty where it found only A committed some elements of the crime and only B committed other elements. We have held that the "and/or" instruction is so seriously flawed as to be fundamental error. Davis v. State, 804 So. 2d 400 (Fla. 4th DCA 2001); Williams v. State, 774 So. 2d 841 (Fla. 2d DCA 2000).
In this case the court gave the principals instruction, standard jury instruction 3.5(a), which explains that if the defendant assisted another person in committing a crime, it is as though the defendant were a principal in committing the crime. The instruction requires that the defendant "had a conscious intent that the criminal act be done." The "and/or" instructions, however, are of course inconsistent with the principals instruction, because the "and/or" instructions do not require that the defendant intended that the act be done. The principals instruction was given after all of the "and/or" instructions on the elements of the crimes, so the jury could have concluded that appellant was guilty because of the conduct of his co-defendant, before it considered the principals instruction.
An error in the giving of an incorrect jury instruction on the element of a crime is such a serious error that it can be fundamental error. Reed v. State, 837 So. 2d 366 (Fla.2002). The "and/or" written instructions in this case, which were incorrect as to the elements which had to be proven by the state for each defendant, require a new trial.
In Garzon v. State, 939 So. 2d 278 (Fla. 4th DCA 2006), this court, in a two-to-one opinion, held that "and/or" instructions, given along with a principals instruction, were not fundamental error, even where the defendant was not directly involved in the crimes and could only have been convicted as a principal. Garzon certified conflict with Zeno v. State, 910 So. 2d 394 (Fla. 2d DCA 2005), and Davis v. State, 922 So. 2d 279 (Fla. 1st DCA 2006), in which the courts concluded that the use of the principals instruction does not cure the "and/or" error, and that the error is fundamental. In the event the supreme court reviews Garzon, it may also find it appropriate to determine if the "and/or" instruction, given in combination with a principals instruction, is non-fundamental error. We accordingly certify the following question as one of great public importance:
DOES THE USE OF AN "AND/OR" JURY INSTRUCTION, OVER OBJECTION, IN A CASE INVOLVING CO-DEFENDANTS, *1168 CONSTITUTE ERROR REQUIRING A NEW TRIAL, WHERE A PRINCIPALS INSTRUCTION IS GIVEN?
Reversed for a new trial.
SHAHOOD and TAYLOR, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614246/ | 939 So. 2d 826 (2006)
Dennis BRACKEN, Jr., Appellant
v.
STATE of Mississippi, Appellee.
No. 2005-KA-01423-COA.
Court of Appeals of Mississippi.
October 10, 2006.
*827 William C. Bristow, Tupelo, attorney for appellant.
Office of the Attorney General by Jacob Ray, attorney for appellee.
Before KING, C.J., SOUTHWICK, IRVING, and GRIFFIS, JJ.
GRIFFIS, J., for the Court.
¶ 1. Dennis Bracken, Jr. was convicted of attempted sexual battery in the Lee County Circuit Court. The trial court sentenced him to serve thirty years, with fifteen suspended, in the custody of the Mississippi Department of Corrections, and *828 the remainder of the sentence to be served under post-release supervision. Bracken appeals and: (1) challenges the sufficiency of the evidence, (2) argues that the verdict was against the overwhelming weight of the evidence, and (3) claims the trial court erred in denying a mistrial due to the exposure of two jurors to extrajudicial comments and actions of witnesses. We find no error and affirm.
FACTS
¶ 2. In April of 2002, Jane[1], a six-year-old girl, told her mother that her bottom hurt and was itchy. Her mother noticed that her daughter's vagina and bottom were red and irritated. Her mother applied medicine to Jane's apparent rash. While doing so, her mother told Jane that the only reason she was touching Jane there was because she needed medicine, but that no one should ever touch her there. Jane stopped her mother and said, "Momma." Her mother asked what was she going to say. Jane replied, "Denny has touched me there." "Denny" is the name Jane used for Bracken.
¶ 3. Jane then told her mother that the last time she was at her aunt's house, her aunt left for a while and left Bracken in charge of Jane. Bracken was eighteen years old. Bracken took her to her aunt's bedroom and told her to undress. He undressed also, lay down on top of her, and pushed down hard, touching his "privacy" to hers. Jane said she cried, told him to stop and that it hurt. Bracken told Jane not to tell. Jane said it had happened several times before. She said no one else had touched her there besides Bracken. Jane said this happened the last time she was at her aunt's house. Her mother determined that this was Easter Sunday, March 31, 2002.
¶ 4. Jane's mother took Jane to her aunt's house. Jane told her aunt she could not come play at her house anymore because Bracken had hurt her. Jane's aunt asked if Bracken hit her. Jane replied, "No," and pointing to her genitals, "He hurt me down there." Jane did not see Bracken again after that.
¶ 5. Jane was taken to a doctor and examined twice. The irritation cleared up within two weeks and never returned. Her mother reported the incident to the Department of Human Services and the police. Jane's mother took Jane to counseling. At counseling, Jane also expressed anxiety she was having over her mother's divorce and her fear of being separated from her stepsisters.
¶ 6. The evidence at trial showed that Jane's account of the event never changed. Her story remained consistent when told to her mother, aunt, counselors, and the jury.
ANALYSIS
I. Was there sufficient evidence to sustain Bracken's conviction?
¶ 7. Bracken argues there was insufficient evidence to support a conviction for attempted sexual battery. The State responds that Jane's symptoms and testimony were sufficient for a reasonable juror to conclude that Bracken had attempted to commit sexual battery.
¶ 8. In reviewing a sufficiency of the evidence claim, the Court considers the evidence in the light most favorable to the verdict. Bush v. State, 895 So. 2d 836, 844(¶ 16) (Miss.2005). Usually, if any reasonable trier of fact could have found the essential elements of the crime beyond a reasonable doubt, we will uphold the verdict. Id.
*829 ¶ 9. A person is guilty of an attempted crime when he intends and tries to commit a crime, does any overt act toward committing the crime, but he fails or is prevented from committing the crime. Miss. Code Ann. § 97-1-7 (Rev.2000). Sexual battery is "sexual penetration with another person without his or her consent [or with] a child under the age of fourteen (14) years of age, if the person is twenty-four (24) or more months older than the child." Miss.Code Ann. § 97-3-95(1)(a) and (d) (Rev.2000). Therefore, to convict Bracken of attempted sexual battery, the State had to prove that Bracken (1) intended to sexually penetrate a child under the age of fourteen, while Bracken was at least two years older than the child, (2) Bracken made an overt act toward committing this offense, and (3) failed or was prevented from doing so.
¶ 10. At the time of the alleged offense, Jane was six years old, and Bracken was eighteen. Jane testified that she and Bracken were both completely undressed. He lay down on top of her and touched his "privacy" to hers. She said he was pushing hard and it hurt. She said his "privacy" was "the thing he pees with." When asked where hers was, she pointed to her genital area. She could not remember if he penetrated her. Her mental health counselor, Carla Davis testified that Jane discussed the abuse, and Jane said that he had "tried" to penetrate her. Jane testified that Bracken told her not to tell anyone or she would not be able to see her cousin anymore. Her mother testified that Jane's skin was red and irritated from the top of her vagina down to her rectum. The jury heard testimony that Jane's story was consistently reported to her mother, aunt, and counselors.
¶ 11. We find there is sufficient evidence for a reasonable jury to conclude beyond a reasonable doubt that Bracken attempted to commit sexual battery. There was evidence he intended to penetrate Jane's vagina with his penis. This satisfies the definition of sexual penetration. Miss Code Ann. § 97-3-97(a) (Rev.2000). At the time of the incident, Bracken was more than two years older than Jane. The evidence also established an overt act toward committing the crime. Finally, there was evidence that Bracken failed to penetrate her. We affirm the trial court's denial of a directed verdict.
II. Was the verdict against the overwhelming weight of the evidence?
¶ 12. The next issue raised by Bracken is that the verdict is against the overwhelming weight of the evidence. He contends that the State's case only consists of Jane's uncorroborated testimony. The State again points out that the evidence consists of Jane's physical symptoms as well as her testimony.
¶ 13. "When reviewing a denial of a motion for a new trial based on an objection to the weight of the evidence, we will only disturb a verdict when it is so contrary to the overwhelming weight of the evidence that to allow it to stand would sanction an unconscionable injustice." Bush, 895 So.2d at 844(¶ 18). The evidence is weighed in the light most favorable to the verdict. Id. The power to grant a new trial should be invoked only in exceptional cases in which the evidence preponderates heavily against the verdict. Id. If the verdict is against the overwhelming weight of the evidence, the proper remedy is to grant a new trial. Id.
¶ 14. We have already discussed the State's evidence which supports the verdict. At trial, Bracken denied the allegations. He said all that happened was that they played a video game. Jane's aunt testified that when she came home Jane and Bracken were playing a video game in *830 the living room. Her aunt said Jane did not appear upset. Jane's mother testified as to the red irritated skin around Jane's vagina and rectum. The jury had this to consider as well as Jane's testimony of her attack. The trial court was within its discretion to consider the competency of the then nine-year-old witness. Veal v. State, 585 So. 2d 693, 697 (Miss.1991). Moreover, Bracken does not challenge whether Jane was a competent witness or not. We are unable to say that the guilty verdict was so against the overwhelming weight of evidence, where the victim's testimony was corroborated by physical evidence. We affirm.
III. Was Bracken entitled to a mistrial because of extrajudicial comments and actions witnessed by some of the jurors?
¶ 15. Finally, Bracken argues that he was entitled to a mistrial. Specifically, he claims that a juror was exposed to the extrajudicial statements and emotional outbursts of the victim's grandmother and two aunts. He argues this raised the possibility of taint, which entitled him to a mistrial. The State argues that the trial court correctly determined that the juror was able to remain fair and impartial. We agree.
¶ 16. Whether to grant a motion for mistrial is within the sound discretion of the trial court. Caston v. State, 823 So. 2d 473, 492(¶ 54) (Miss.2002). The standard of review for denial of a motion for mistrial is abuse of discretion. Id. The Uniform Rules of Circuit and County Court provide:
Upon motion of any party, the court may declare a mistrial if there occurs during the trial, either inside or outside the courtroom, misconduct by the party, the party's attorneys, or someone acting at the behest of the party or the party's attorney, resulting in substantial and irreparable prejudice to the movant's case.
Upon motion of a party or its own motion, the court may declare a mistrial if [ ] the trial cannot proceed in conformity with law. . . .
URCCC 3.12. The most fundamental and sacred rights secured for the criminal defendant is his right to a trial before a fair and impartial jury. Johnson v. State, 476 So. 2d 1195, 1209 (Miss.1985). "Because of this, once the jury is empaneled, all cautionary measures possible should be taken to prevent extraneous or outside influence from reaching the jury in an effort to ensure impartiality and to ensure that the accused receives a fair trial." Williamson v. State, 512 So. 2d 868, 882 (Miss.1987) (overruled on other grounds). Outside influences must be eliminated if possible and minimized otherwise or the verdict rendered is questionable and a mistrial is appropriate. Fuselier v. State, 468 So. 2d 45, 53 (Miss.1985).
¶ 17. During the trial, Juror Elliott approached the bench and told the trial court that she had overheard witnesses discussing the case in the bathroom. The trial court dismissed the jury with the exception of Juror Elliott. Juror Nickey Carter spoke up, "She asked my opinion, Your Honor. I know about it." The trial court instructed Juror Carter to leave the courtroom and to wait until he was called back.
¶ 18. Juror Elliott told the court that she went to the bathroom and overheard a conversation between Jane's grandmother and two aunts, one of whom had testified. She described an angry outburst and discussion about the case. She said she did not hear anything that she could not set aside. When asked did she relay this information to Juror Carter, Juror Elliott responded, "Yeah. We were sitting in the jury room later, you know, together, and I *831 said, well, you know, I said I didn't really hear anything. Do you think I should say something? And he said, well, it wouldn't hurt." The trial court had Juror Elliott return to the jury room and then called Juror Carter.
¶ 19. The trial court asked Juror Carter to tell exactly what Juror Elliott told him about the bathroom incident. He replied, "She said she went to the bathroom and saw some of them there. I'm not sure if she specified who. And that they were talking. She heard nothing specific. Should I tell somebody? And who? I said yes, I think you need to tell the judge." The trial court dismissed Juror Elliott and had her replaced by the second alternate. The first alternate had already replaced a juror who, halfway through the trial, realized he knew Jane's family. The trial court did not dismiss Juror Carter and denied Bracken's motion for a mistrial.
¶ 20. From this record, we cannot say the trial court abused its discretion by denying the mistrial. From both jurors' testimony it does not appear that Juror Carter knew anything other than Juror Elliott overheard some witnesses talking. He did not know which witnesses nor did he know the substance of the conversation. His only role was to encourage a fellow juror to report an incident which might have affected that juror's impartiality. There is nothing to indicate that Juror Carter was exposed to the outside influence. Accordingly, we find no error and affirm.
¶ 21. THE JUDGMENT OF THE CIRCUIT COURT OF LEE COUNTY OF CONVICTION OF ATTEMPTED SEXUAL BATTERY AND SENTENCE TO SERVE A TERM OF THIRTY (30) YEARS IN THE CUSTODY OF THE MISSISSIPPI DEPARTMENT OF CORRECTIONS, AND THAT FIFTEEN (15) YEARS SHALL BE SUSPENDED, AND THE DEFENDANT SHALL BE PLACED UNDER POST-RELEASE SUPERVISION IS AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO LEE COUNTY.
KING, C.J., LEE AND MYERS, P.JJ., SOUTHWICK, IRVING, CHANDLER, BARNES, ISHEE AND ROBERTS, JJ., CONCUR.
NOTES
[1] To protect the identity of the victim and her family, we use a fictitious name. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919987/ | 91 B.R. 473 (1988)
In re Annie JACKSON, Debtor.
Bankruptcy No. 88 B 05051.
United States Bankruptcy Court, N.D. Illinois, E.D.
June 8, 1988.
Katherine Harvey, Oak Park, Ill., for debtor.
John F. Brennan, Jaros, Tittle & O'Toole, Chicago, Ill., for Talman Home Sav.
MEMORANDUM OPINION AND ORDER
RONALD S. BARLIANT, Bankruptcy Judge.
This Chapter 13 case is before the Court for a hearing on confirmation of the Debtor's plan and on the motion of Talman Home Federal Savings and Loan Association to dismiss the case. This Court finds that the present plan is an attempt to achieve a purpose forbidden by Congress, and for that reason cannot satisfy the good faith requirement of 11 U.S.C. § 1325(a)(3). Therefore, confirmation is denied and the case is dismissed.
The factual allegations made in Talman's motion have not been controverted, and additional facts came out at the hearing of these matters or appear from the Debtor's filings. The Debtor and her husband, Melvin Jackson, together with their three children, live in a house subject to a 1979 first mortgage held by Talman in the original amount of $21,900. According to the Debtor's schedules, there is now a $21,123.00 principal balance due on that mortgage and a $7,894.00 arrearage. The Debtor and her husband are both mortgagors under the Talman mortgage.
This is the fourth Chapter 13 petition filed by the Debtor and her husband since 1982. Melvin Jackson filed the first case in September, 1982. That case was converted to a Chapter 7 case and Mr. Jackson received a discharge in 1984.[1]
*474 The Debtor filed the second of the Jacksons' four Chapter 13 petitions in December, 1983. After a fourteen month default in post-petition mortgage payments, Talman obtained relief from the automatic stay in February, 1987. According to representations made in Court, Mrs. Jackson's 1983 Chapter 13 case was eventually dismissed.
The third case was filed by the Debtor's husband in April, 1987, the stay was again lifted for failure to make post-petition mortgage payments and that case was dismissed in February, 1988. A month later, the present case was filed.
The Bankruptcy Code permits a Chapter 13 debtor to cure a home mortgage arrearage within a "reasonable time". 11 U.S.C. § 1322(b)(5). In no event, however, may plan payments extend more than five years. 11 U.S.C. § 1322(c). Therefore, in every case a "reasonable time" must be five years or less.
According to Talman's motion, all the plans proposed by the Debtor and her husband, including Mr. Jackson's September, 1982 plan, proposed curing the arrearage under the Talman mortgage in 24 months. Yet, if this Court were to confirm the present plan, the Debtor and her husband jointly would have been allowed about seven and a half years to cure the arrearage.[2] Thus, the Jacksons' would have achieved in four cases (the first three of which failed) what Congress has prohibited a debtor from doing in one case.
Attempts to use serial filings to achieve purposes otherwise unattainable under the Bankruptcy Code have been characterized as "bad faith" by other Courts. Matter of Troutman, 11 B.R. 108 (Bankr.E.D.N.Y., 1981); In re Diego, 6 B.R. 468 (Bankr.N.D. Cal.1980). In those cases, the debtors obtained Chapter 7 discharges of their unsecured, dischargeable debts, and then filed Chapter 13 petitions to restructure their secured and non-dischargeable debts. Those serial Chapter 7 and 13 filings would have had the same result as Chapter 13 plans proposing no payments to unsecured creditors, which would have been non-confirmable at least in those courts at those times. As the Troutman Court said,
Here the Debtor's are attempting to accomplish in two proceedings what they could not accomplish in one. They have used Chapter 7 to discharge their unsecured debts and now seek to use Chapter 13 to deal with their secured creditors. Had they combined the two proceedings into one under Chapter 13, confirmation would have been denied since their plan would have offered no payments to unsecured creditors.
11 B.R. at 109. For those reasons, the plans in Troutman and Diego were held to be in bad faith.[3]
Here, the Debtor maintains that she is acting in good faith. She states that she and her husband are making every effort to save their home after various financial misfortunes caused them to fall in arrears. She also states that her circumstances have changed in that one of her three children is now employed and able to make a contribution to the household. (The Debtor's budget does not reflect any such contribution from a child but only reflects a $290 per month contribution from the Debtor's husband.)
This Court has no reason to doubt that the Debtor and her husband are sincere in their efforts to keep their house and that, if they could, they would satisfy their obligation to Talman. Certainly, Chapter 13 of the Bankruptcy Code is designed to afford a second chance to people like the Jacksons *475 when they encounter financial difficulties. But, the Bankruptcy Code also imposes limits upon the power of debtors to reorganize at the expense of creditors, particularly secured creditors.
Good faith is not synonymous with honesty and bad faith is not synonymous with dishonesty. But if the good faith requirement of Section 1322 means anything, it means that the proposed plan cannot be a device to avoid the limitations imposed by the Bankruptcy Code itself. The good faith requirement "is meant to bar the confirmation of a chapter 13 plan . . . where the proposed plan, if consummated, would contravene the spirit of Chapter 13." H.R.Rep. No. 1195, 96th Cong., 2d Sess. 24 (1980). Although the plan proposed here, looked at in isolation, appears to comply with the spirit and purposes of Chapter 13, when viewed in combination with the prior filings, the effect would be the circumvent of statutory limitations on the powers of Chapter 13 debtors to compromise the rights of secured creditors.
Confirmation of the Debtor's Chapter 13 plan is therefore denied and this case is dismissed.
NOTES
[1] Talman's motion states that Mr. Jackson and his wife are both liable under the note. If Mr. Jackson received a Chapter 7 discharge and there was no reaffirmation of the mortgage debt, it is doubtful that Mr. Jackson has personal liability. That question, however, it not relevant to the issues here. It does not appear that the present Debtor, Mrs. Jackson, has ever been discharged.
[2] The first case was filed in September, 1982. The plan now under consideration proposes to satisfy the arrearage in two years, or by about May, 1990.
[3] Other courts have held that multiple filings for the purpose of delaying secured creditors evidenced an absence of good faith. In re Kinney, 51 B.R. 840 (Bankr.C.D.Cal.1985) (10 petitions within 25 months); In re Jones, 41 B.R. 263 (Bankr.C.D.Cal.1984) (6 petitions within two years). This Court elects not to rely on that ground, although it is clear that Talman has been seriously delayed in the exercise of its rights. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920036/ | 91 B.R. 673 (1988)
In re Jerome JORDAN, Debtor.
Bankruptcy No. 87-04533S.
United States Bankruptcy Court, E.D. Pennsylvania.
August 25, 1988.
Supplemental Opinion Sur Motion for Reconsideration October 31, 1988.
As Modified October 31, 1988.
Edward Sparkman, Philadelphia, Pa., Standing Chapter 13 Trustee.
Timothy P. Booker, Philadelphia, Pa., for debtor.
Arthur J. Matasow, Edwin Seave, Philadelphia, Pa., for Mid-Penn.
Hugh A. Benson, Chief Counsel, Dept. of Banking, Harrisburg, Pa., for Pa. Dept. of Banking.
Alan C. Gershenson, Philadelphia, Pa., for Pa. Financial Services Ass'n.
OPINION
DAVID A. SCHOLL, Bankruptcy Judge.
We herein consider certain Objections raised by JEROME JORDAN, a Chapter 13 *674 Debtor (hereinafter "the Debtor"), to a Proof of Claim filed by a party holding a second mortgage on his residential realty, Mid-Penn Consumer Discount Company (hereinafter "the Claimant"). The principal contest is over entries on an Amended Proof of Claim for pre-petition "late charges" and post-petition "additional late charges," the latter of which the Claimant contends are chargeable to provide it with the value of its claim upon the Debtor's deferral of payment to it in his Plan, pursuant to 11 U.S.C. § 1325(a)(5)(B)(ii).
We hold that the Claimant has not met its burden of establishing the legitimacy of its pre-petition late charges, especially since the Claimant appears to be arguing that it may compound such charges. We further hold that, under no circumstances, is the Claimant justified in imposing claimed post-petition late charges.
The Debtor filed the instance Chapter 13 bankruptcy case on September 11, 1987. A Plan, calling for payments of $200.00 monthly for thirty-six (36) months was filed with the Petition. This Plan would generate total payments of $7,200.00. The Claimant filed its initial secured Proof of Claim, on October 2, 1987, reciting "[t]he sum of $7,209.39 to be paid inside of Plan. The sum of $1,820.00 to be paid directly to Mid-Penn outside of Plan." The components of the $7,209.39 figure were set forth as follows:
Principal Amount $2,860.00
Late Charges 486.06
Additional Late Charges 2,308.78
Charges Due 1,554.55
_________
TOTAL $7,209.39
On October 22, 1987, the Claimant also filed its de rigueur Objection to confirmation of the Debtor's Plan, contending that, as per his Plan, the Debtor was not remitting post-petition payments. See In re Ford, 84 B.R. 40, 41 (Bankr.E.D.Pa.1988). In fact, the instant Plan recites nothing concerning remittance of post-petition payments to the Claimant, although this may have been the Debtor's implicit intention.
However, the Debtor's initial difficulties were not with the Claimant, but concerned his first mortgagee, Atlantic Financial Federal (hereinafter referred to as "AFF"), which filed a motion for relief from the automatic stay under 11 U.S.C. § 362(d) when he made no post-petition remittances to it. AFF ultimately filed a secured claim in the amount of $7,029.61 for arrearages only and the Debtor managed to iron out his difficulties with AFF by apparently catching up on all post-petition payments, which he was making outside of the Plan.
Unfortunately, remitting payments to AFF resulted in the Debtor's inability to pay either the Claimant or the Trustee. Also, his Plan, generating but $7,200.00 in total payments, was clearly insufficient to fund both the claim of $7,029.61 of AFF and the claim of over $7,200.00 filed by the Claimant. Therefore, the Debtor's Plan could not be confirmed at its first listed Confirmation Hearing on February 25, 1988.
By the date of the second listed Confirmation Hearing on April 7, 1988, the Standing Chapter 13 Trustee had filed a motion to dismiss the Debtor's case on the ground that the Debtor's Plan was infeasible, and that payments were not being made, even according to the Plan.
Since the case appeared to have serious problems which must be resolved immediately if the case was to survive and result in a confirmed Plan, we ordered the Debtor, on April 7, 1988, to file an Amended Plan and either make payments, file a motion to abate payments, and/or file an Objection to the Claimant's Proof of Claim on or before April 15, 1988, and we rescheduled hearings on Confirmation, the Trustee's motion to dismiss, and any Objections which were in fact filed on May 19, 1988.
By May 19, 1988, the Debtor had resolved the payment delinquency, and he sought to file an Amended Plan calling for payments of $125.00 monthly for sixty (60) months. However, clearly this Amended Plan was insufficient to resolve the feasibility problem in light of the presence of AFF's claim and the Claimant's claim, since it would generate total payments of only $7,500.00. Therefore, On May 19, 1988, we entered a further Order directing the Debtor to file a further Amended Plan and/or *675 Objections to the Claimant's claim on or before May 27, 1988, or suffer dismissal of the case at the next scheduled Confirmation Hearing date, on June 7, 1988.
On May 31, 1988, the Debtor belatedly filed the instant Objections to Claimant's Proof of Claim. Although these were to also be heard on June 7, 1988, the late filing of the Objection caused the Clerk's Office to schedule same on July 5, 1988. On June 7, 1988, we agreed to a final relisting of the Confirmation Hearing and the Trustee's Motion to dismiss on that date.
In the Objections, the Debtor contended that the claim "contains illegal interests [sic] and usurious interests" [sic] and "erroneous and exorbitant late charges" which resulted in a claim for "an outrageous figure and not legal or lawful by any means." The Claimant responded with an Answer defending its claim but, later, on July 1, 1988, implicitly admitting its partial merit, filed an Amended Claim which reduced its component of "additional late charges" claimed to $1,310.17, dropping its total claim to $6,210.78.
At the July 5, 1988, scheduled hearing, the Debtor expressed a desire to contest the claim, even as amended. He and Frederick Robinson, the Claimant's Vice-President, testified at the hearing of July 5, 1988, on this matter.
It was established at this hearing that, on November 14, 1985, the Debtor had made a loan from the Claimant in which he received net proceeds of $3,022.07. However, with added costs for life and disability insurance and a fee to record a mortgage taken upon his home in the transaction, and the addition of pre-computed finance charges for allowing repayment at $130.00 monthly over three years at an annual percentage rate of 25.4 percent, the total payments, through November, came to $4,680.00. The following clause in the contract pertained to "late charges:"
LATE CHARGES AND DEFERMENT CHARGES: If any payment is 10 or more days past due a late charge of 1½% per month of the amount that is past due may be collected provided however a minimum charge of $1.00 may be collected per defaulted payment. If payment is deferred a deferment charge of 1½% per month of the amount deferred for the period of the deferment may be collected. Nothing contained herein shall in any way be deemed to authorize the Debtor(s) to make any payment other than on the due date thereof or defer any payment beyond such due date.
The Debtor conceded that he never made any payments on this loan. He attributed this to the fact that he was not working over this period due, in large part, to a severe arthritic condition that rendered him physically disabled as of February or March, 1986. Unfortunately, the Debtor admittedly failed to notify the Creditor of this until over a year later in spring of 1988. Therefore, although the disability insurer on the loan should have been making the payments since early 1986, in fact it had only begun to do so as of a much later date. Since these payments would now be made directly to the Claimant by the insurer, the parties agreed that they should be designated as payments "outside the Plan."
Upon hearing the Debtor's testimony and recognizing that some considerable indebtedness was owed to the claimant, as well as to AFF, we did some rough calculations as to what the Debtor would have to remit to render the Plan potentially feasible. We stated that we believed the sum necessary to be paid to the Trustee in a 60-month Plan would be close to $250.00 monthly. We asked the Debtor if he could pay this much. With some reluctance, he answered affirmatively.
Mr. Robinson, identifying himself as the custodian of the Claimant's records, then took the stand. He stated that the "Principal Amount" of the Proof of Claim reflected twenty-two (22) payment due prepetition ($130.00 × 22 = $2,860.00). He explained that the "additional late charges" had been computed by determining the balance due as of November, 1988, when the loan expired, and adding the late charge of 1½% per month on each month through the termination of the Plan in September, 1992, when he projected that the loan would be *676 paid off. The precise calculations were not tendered. The reduction of the "additional late charge" computation from $2,308.78 to $1,310.17 was attributed to an unexplained error in the original calculations. Support for the procedure of calculation utilized was garnered from an exchange of correspondence of July, 1987, between Edwin Seave of the Claimant and F.A. George, Director of the Consumer Credit Bureau of the Pennsylvania Department of Banking in which Mr. George stated that "it is our opinion that at the expiration date of the contract . . . the entire balance due is delinquent and, therefore, subject to the 1½% per month charge to continue until the final amount is paid."
Copious documentation of the "charges due" was supplied, in the form of a computer print-out of the account history and copies of actual receipts of charges. These charges were incurred in two separate collection lawsuits against the Debtor which proceeded to judgments and consequent execution sales before being halted by the present and a previous bankruptcy filing, respectively. We note that the sum of the receipts is $1,649.50, but that only $1,554.55 is claimed for this entry by the Claimant.
No calculation of the amount of $486.06 for "late charges" was proffered. In a colloquy with the court, Mr. Robinson made it clear that late charges were not merely computed as a one-time charge when a payment was late each month, but that 1½% per month was assessed on the entire balance due in that month in making the calculations.
At the close of the hearing, counsel for the Claimant expressed an interest in defending particularly its assessment of "additional late charges." We therefore entered yet another Order of July 6, 1988, allowing the Debtor to file another Plan which had a greater probability of feasibility than its predecessors; allowing the Claimant and the Debtor until August 1, 1988, and August 15, 1988, respectively, to file Briefs supporting their positions; and rescheduled the Confirmation Hearing and the Trustee's Motion to Dismiss on September 1, 1988. Undoubtedly taking his cue from our colloquy with the Debtor at the July 5, 1988, hearing, the Debtor has filed an Amended Plan calling for payments of $250.00 monthly for sixty (60) months.
The beginning point of our legal analysis is our decision in In re Lewis, 80 B.R. 39, 41 (Bankr.E.D.Pa.1987), wherein we indicated our view of the appropriate allocation of the burden of proof in proof of claim litigation. Since both parties presented evidence at a contested hearing, the instant matter tracks Scenario 5 recited therein. The Debtor having produced some evidence tending to defeat certain components of the claim, the "bubble" of any presumption in favor of the Claimant was "burst," and the burden of proving all components of its claim by a preponderance of the evidence was thrust upon the Claimant.
The most vulnerable component of the Claimant's Proof of Claim is, as it anticipated, its entry for "additional late charges." The legal bases of the Claimant's demand for such charges is the contract clause recited at page 675 supra; the applicable state statute, the Pennsylvania Consumer Discount Company Act, 7 P.S. § 6201, et seq. (hereinafter referred to as "CDCA"), and particularly § 6213 K thereof; and the pertinent state regulation, 10 PA.CODE § 41.3(d). The latter two provisions read as follows:
7 P.S. § 6213 K:
In addition to the general powers conferred upon a corporation by the Business Corporation Law of this Commonwealth, a corporation licensed under this act shall have power and authority:
. . . . .
K. To collect an additional charge for extension, deferment or default in the payment of any contract or for extension, deferment or default in the payment of any installment on a contract at the rate of one and one-half percent (1½%) per month on the amount extended, deferred or in arrears. Provided, however, a minimum charge of one dollar ($1) may be collected *677 for any extension, deferment or default of ten (10) or more days.
10 PA.CODE § 41.3(d):
(d) The act requires that due notice of a licensee's intention to collect default charges be given to the consumer in the statement of contract. A licensee may, upon notice, collect a specified default charge on loan contracts at the rate permitted in the action on the amount in default. The minimum charge permitted in the act may be collected for a default of 10 or more days. No charge may be collected for default created by the deduction of default charges from prior installments. After maturity of the loan contract, the entire unpaid balance is the amount in default. No provision has been made permitting the full default charge to be collected for a fraction of a month when the loan contract is less than a month in default; therefore, it is necessary to calculate the default charge on the actual number of days from the due date of the payment in default to the date the payment is collected. Default charges may be accrued and collected at the time of final payment of a loan contract. Default charges accruing prior to periods of claims may be deducted from the proceeds of accident and health insurance claim payments; however, default charges may not accrue during periods of claims (emphasis added).
For purposes of this argument, we will assume, as the Claimant argues, that the language emphasized above supports the Claimant's imposition of these charges under state law, apart from consideration of the impact of the Bankruptcy Code. We will also assume arguendo that these charges were calculated correctly. Nevertheless, we must conclude that the Claimant's attempt to append "additional late charges" to its Proof of Claim in bankruptcy cannot be supported.
In a careless moment during the hearing of July 5, 1988, Mr. Robinson stated that the entry for "additional late charges" was the equivalent of a claim for "interest on arrears." We agree, and we believe that the decision in In re Capps, 836 F.2d 773 (3d Cir.1987), precludes this portion of the Claimant's Proof of Claim.
The Claimant argues, like the mortgagee in Capps, that 11 U.S.C. § 1325(a)(5)(B)(ii) "necessitates" payment to it for the loss of the use of its money during the period of time that it takes the Debtor to "cure" the payment delinquency to the Claimant through his Plan. Id. at 775. However, as the Court of Appeals points out in Capps, a "cure" of a default is not an impermissible modification of the interests of a secured creditor. Id. All that § 1325(a)(5)(B)(ii) does is "limit the effects of cramdown," id. at 776, by assuring that a creditor receives the present value of its claim. Thus, § 1325(a)(5)(B)(ii) merely provides that the deferral of a secured creditor's allowed claim will not be uncompensated. In no sense does it provide that the secured creditor will be guaranteed a return, upon deferral, which is enhanced by all of the additional charges that would be otherwise permissible under the parties' contract and/or state law.
The Claimant also misreads those cases where we have held that § 1325(a)(5)(B)(ii) does come into play, e.g., In re Mitchell, 77 B.R. 524 (Bankr.E.D.Pa.1987) (hereinafter "Mitchell II"); In re Mitchell, 75 B.R. 593, 598-99 (Bankr.E.D.Pa.1987) (hereinafter "Mitchell I"); and In re Crompton, 73 B.R. 800, 806-07 (Bankr.E.D.Pa.1987) (hereinafter "Crompton II"). In those cases, we required the respective debtors, as a condition for presenting confirmable plans, to compensate their respective secured creditors for deferral of their claims. We did not hold that the deferral charge was added into or became part of the claim itself. Compare Mitchell I, 75 B.R. at 599, 600 (interest for deferral added to claim, not made a part of the claim); Crompton II, 73 B.R. at 806-07 (interest for deferral added to the amount of the claim already determined in In re Crompton, 68 B.R. 831 (Bankr.E.D.Pa.1987) ("Crompton I"), not made a part of the claim).
*678 Moreover, as we emphasized in Mitchell II, the interest rate for effecting deferral of payment of a secured claim, pursuant to § 1325(a)(5)(B)(ii), is measured by the lesser of the contract rate or the market rate of interest. 77 B.R. at 527, 529. The "contract rate" of 1½% per month, or 18% per annum, is surely higher than the market rate.
The Claimant may, of course, object to confirmation of the Debtor's plan if the Plan fails to provide it with interest, at the market rate, for deferral of its secured claim under § 1325(a)(5)(B)(ii). However, it may not add the interest for deferral into its claim. Nor may it insist that the interest rate for deferral be as steep as the "contract rate" of 18% per annum.
We now address the pre-petition "late charge" component of the Claimant's claim. In this discussion, we express our doubt that the parties' contract and the applicable state law permits a computation of "late charges" as the Claimant would have it. We also express our firm conclusion that the Claimant has failed to establish, by the requisite preponderance of evidence, that it properly and legally computed either the pre-petition or the post-petition "late charges" recited in its Proof of Claim.
We have considered the subject of "late charges" in the past in three cases, Gambale v. Lomas & Nettleton Co., 80 B.R. 308, 310 (E.D.Pa.1987); In re Andrews, 78 B.R. 78, 80-84 (Bankr.E.D.Pa.1987); and In re Dangler, 75 B.R. 931, 933-34 (Bankr.E. D.Pa.1987). In Gambale and Dangler, we addressed allegations that violations of the federal Truth-in-Lending Act, 15 U.S.C. § 1601 et seq. (hereinafter referred to as "TILA"), arose due to the failures of the respective mortgagees to designate, on the TILA disclosure statements given to the respective mortgagors, whether the late charge, measured by a percentage of four (4%) percent per month, was computed by reference to "the current monthly payment only or the entire accrued delinquency of all monthly payments then due." Gambale, supra, 80 B.R. at 310. The defense of the mortgagee in Gambale was that it was self-evident that a "late charge" would be computed by reference to the current monthly payment only. Id. Here, however, the Claimant seeks to calculate its "late charge" by reference to the entire accrued delinquency of all monthly payments.[1]
The Claimant obviously believes that its contract and the pertinent state law and regulation are clear in allowing it to compute the late charge by reference to the accrued delinquency of all monthly payments. We disagree. The pertinent contract clause, quoted at page 675 supra, allows 1½% "per month of the amount that is past due." It also states that the charge is imposed "per defaulted payment." The terms "per month" and "per defaulted payment," appearing, respectively, before and after the phrase "amount that is past due" may confine the meaning of the phrase "to the amount that is past due" to only the amount that is past due per one month or per one defaulted payment. At any rate, the phrase is ambiguous, and, as in a similar context in Andrews, supra, we note "that any ambiguities in a contract, particularly an adhesion contract in which there was no bargaining over terms, must be construed strictly against the party who drafted the contract." 78 B.R. at 81.
Irrespective of the applicable law, which is merely permissive in allowing a certain maximum sum of finance charges if the contract so provides, the Claimant cannot collect any particular "late charges" without express authorization to do so in the contract. Therefore, an ambiguity in the contract may be fatal to the Claimant's attempt to compound late charges on the entire balance in default.
*679 Similarly, a contract clause allowing a certain computation of late charges will be unenforceable if it is contrary to that authorized by the applicable statute or regulation. Therefore, only if the contract and the statute and regulation are all unambiguous in allowing the Claimant to compound late charges would we be confident in allowing the Claimant to do so.
The applicable statute, 7 P.S. § 6213 K, quoted at pages 676-77 supra, is not clear on this point at all. It states that the maximum permissible "charge for . . . default in the payment of any installment on a contract . . . in arrears" is 1½% "per month." The use of the singular terms "charge," "installment," "payment" and "month" suggest that the maximum single charge for any late installment is 1½% of the payment due in a single month. Therefore, the use of the singular throughout suggests that the computation must be made by reference to the current monthly payment only.
The applicable regulation, 10 PA.CODE § 41.3(d), also quoted at page 677 supra, does little to assist in interpretation of this point. Reference is made to the right of a licensee under the CDCA to collect a late charge "on the amount in default." This phrase could apply to the default for only that month or the entire amount in default. The balance of the regulation's language does not address this latent ambiguity. Meanwhile, the regulation is very clear in providing that "[a]fter maturity of the loan contract, the entire balance is the amount in default." However, it is considerably less clear in defining what "the amount in default" is deemed to be prior to maturity of the loan contract.
The Claimant cites no Pennsylvania cases construing 7 P.S. § 6213 K or 10 PA.Code § 41.3(d) in the manner in which it does, and we could find none. Therefore, we are apparently dealing with a matter of first impression. The most closely analogous cases in which the issue of computation of late charges generally was raised was in our decisions in the Gambale, Andrews, and Dangler cases. There, the mortgagees consistently took the position that late charges could be computed only on the particular monthly payment which is late.
Several general principles in construction of contract clauses and laws regarding charges for interest or late payments to borrowers or consumers suggest that the Claimant's method of computing late charges is incorrect.
The first is the holding of Haas v. Pittsburgh National Bank, 526 F.2d 1083, 1094-95 (3d Cir.1975); and Acker v. Provident National Bank, 512 F.2d 729, 739-42 (3d Cir.1975), that compounding interest or charging "interest-on-interest" is contrary to Pennsylvania law. Both of these cases addressed the seemingly innocuous practices of certain well-respected, well-represented, and well-meaning financial institution in computing finance charges on the "outstanding balance" or the "previous balance" from the prior month in computing monthly finance charges imposed on revolving credit-card account balances. Haas echoed Acker's holding that compounding of interest was tolerated in Pennsylvania only when an "express, affirmative statement" in the law permitted it. 512 F.2d at 739. Both cases held that the Defendants' practices in issue there, be they ever so "reasonable," were illegal.
The Claimant's precise method of operation in computing late charges is unclear. That lack of clarity is a sufficient basis in itself for denying the late charges claimed due to it by the Claimant, on the ground that it has not met its burden of proving, by a preponderance of evidence, that the charges imposed were legitimate. Compare Lewis, 80 B.R. at 43 (mortgagee denied all late charges in Proof of Claim where it failed to show precise method of computation of such charges).
It is my no means certain that the Claimant has not illegally compounded late charges in making its calculations. It appears that the Claimant believes that it was entitled, under the CDCA provision and regulation quoted, to add late charges for the initial month that payments were late onto a total balance, and then to compute late charges for each succeeding month on the basis of a figure which included not *680 only all of the payments which were delinquent, a practice itself questionable, but onto a figure which included previously-accrued late charges as well as delinquent payment. This clearly would be compounding of late charges, a practice condemned in Haas and Acker. This is comparable to the method of computation which permitted the creditor in In re Souders, 75 B.R. 427, 437-38 (Bankr.E.D.Pa.1987), to parlay a $30,000.00 obligation into a claim of $147,933.75. We submit that the pertinent law and regulation give no more express, affirmative approval to such a practice than did the state laws in issue in Haas and Acker.
Courts in several other American jurisdictions have utilized several legal grounds as bases for invalidating unconscionable late charges. See Annot., Validity of Construction of Provision Imposing "Late Charge" or Similar Exaction for Delay in making Periodic Payment on Note, Mortgage, or Instalment Sale Contract, 63 A.L.R.3d 50, 57-65 (1975).
One basis is that excessive late charges constitute imposition of additional interest charges and are hence usurious. See, e.g., Bunn v. Weyerhauser Co., 268 Ark. 445, 598 S.W.2d 54, 56 (1980); Wright Insurance Agency, Inc. v. Scott, 371 So.2d 1207, 1208 (La.App.1979); Begelfer v. Najarian, 381 Mass. 177, 409 N.E.2d 167, 172-74 (1980); Dixon v. Brooks, 604 S.W.2d 330, 333-34 (Tex.Civ.App.1980); and Annot., supra, 63 A.L.R.3d at 61-64. We note that, in Bunn, the late charge imposed was precisely the same as that in issue here, 1½% per month.
Another basis is that such late charges are a purported liquidated damage clause which, being excessive in measuring the damage resulting to the creditor as a consequence of the consumer's late payment, constitutes an unenforceable penalty clause. See Garrett v. Coast & Southern Federal Savings & Loan Ass'n, 9 Cal.3d 731, 1202-03, 108 Cal.Rptr. 845, 850-51, 511 P.2d 1197 (1973); Willoughby Real Estate Co. v. Sanders, 109 Daily Wash.L.Rptr. 1149 (D.C.App.1981) (maximum enforceable late charge for a delinquent rental payment limited to a one-time charge equal to 5% of the monthly rent or $10.00 monthly, whichever is less); Burstein v. Liberty Bell Village, Inc., 120 N.J.Super. 54, 57, 293 A.2d 238, 240 (1972); and Annot., supra, 63 A.L.R.3d 59-61.
This latter argument strikes a responsive chord in a vein of Pennsylvania cases holding that a contractual provision for liquidated damages "that calls for a payment of a sum on non-performance or on default that is disproportionate to the . . . injury that has actually occurred will be deemed a penalty [and] . . . `will be voided. . . .'" Finkle v. Gulf & Western Mfg. Co., 744 F.2d 1015, 1021 (3d Cir.1984). See also, e.g., In re Plywood Co. of Pa, 425 F.2d 151, 155 (3d Cir.1970); In re Oscar Nebel Co., 117 F.2d 326, 328 (3d Cir.1941); Dorrance v. Lehigh Valley Coal Co., 13 F.Supp. 73, 76 (M.D.Pa.1936); Unit Vending Corp. v. Tobin Enterprises, 194 Pa.Super. 470, 473, 168 A.2d 750, 751 (1961); National Fuel Gas Distribution Corp. v. Pennsylvania Public Utility Comm'n, 76 Pa.Cmwlth. 102, 127 n. 8, 464 A.2d 546, 558 n. 8 (1983); and RESTATEMENT (SECOND) OF CONTRACTS, § 356(a) (1981).[2]
We are certainly not prepared to conclude intuitively that the Claimant suffered $486.06 of additional losses as a result of the Debtor's failure to make his loan payments in timely fashion. Certainly, no proof of any such damages was placed upon the record here. It should be recalled that this particular lender was, by the terms of the parties' original contact, imposing interest charges at an annual percentage rate of over 25 percent per annum. See page 675 supra. It appears unconscionable to allow the Claimant to enhance this sum with late charges calculated by a *681 method substantially more beneficial to it than the method utilized by other mortgagees, such as those in issue in Gambale, Andrews, and Dangler, who were collecting interest at an annual percentage rate of less than half as much.
There are, therefore, alternative policy reasons for construing the ambiguous provisions of the parties' contract and the applicable law against the Claimant, and limiting it to no more than a one-time 1½% surcharge on a late monthly payment, similar to the practices espoused by the mortgagees in Gambale, Andrews, and Dangler. While we cannot determine precisely how the Claimant made its calculations of late charges, we know that it charged more than the $70.20 maximum permissible additional charges under this method of calculation. See page 678 n. 1 supra.
In any event, as we explained at page 679 supra, since the Claimant has failed to meet its necessary burden of proof of totally justifying the late charges imposed upon the Claimant here by revealing its method of calculation of same, our decision in the Lewis case on analogous facts is controlling here. Therefore, the Claimant's entire itemized entry of $486.06 for "late charges," as well as its entire itemized entry of $1,310.17 for "additional late charges," will be stricken from its Amended Proof of Claim. The sum of these figures, $1,796.23, will therefore be deducted from the amount claimed of $6,210.78 in our calculation of the valid Proof of Claim to which the Claimant is entitled. We shall therefore reduce the Claimant's secured claim to the net amount of $4,404.55.
In his Brief, the Debtor contends that the "charges due," or costs, of $1,554.55 are excessive due to the fact that, in its calculation of same, the Claimant failed to give the Debtor credit for refunds deducted from the two sums of $650.00 deposited with the sheriff as deposits for the costs of conducting sheriff's sales, receipts for which were included among those submitted by Mr. Robinson. Furthermore, in a wild swing for a grand-slam home run, the Debtor closes his Brief by stating that, because of the Claimant's failure to include the refund, "we asked [sic] that the entired [sic] claim be dismissed on the grounds that it was filed in bad faith."
On this point, the Debtor confronts the same problem that the Claimant did on its request for pre-petition late charges, i.e., there is a total lack of any substance in the record to support his contentions. The potential inaccuracy of the receipts produced by Mr. Robinson was never questioned at the hearing. On this point, the Claimant placed into the record documentation supporting a total sum of $1,649.50, surely ample to support a $1,554.55 amount for this entry on the Proof of Claim. We cannot assume that the sheriff would have or did issue a refund to the Claimant without evidence of same. The Debtor had ample opportunity to question Mr. Robinson on this point, but did not do so. Our speculation is not conclusive, but we note that it is conceivable that the difference between the receipts produced by Mr. Robinson and the amount claimed for such costs could reflect these refunds.
In any event, while overstating the sums due to it, we fail to find the Claimant to have acted in bad faith. Mr. Robinson's contentions appeared to have represented genuine convictions that he was correct in his requests for all of the entries on the Proof of Claim. The Claimant's post-hearing arguments in support thereof were plausible and delivered in, if anything, a more coherent and convincing fashion than the Debtor's counter-arguments.
However, we disagree with the contentions of the Claimant that the entries for "late charges" or "additional late charges" in its Proof of Claim are supported by this record, and therefore we will proceed to enter an Order reducing its secured claim to $4,404.55.
SUPPLEMENTAL OPINION SUR MOTION FOR RECONSIDERATION
On August 31, 1988, subsequent to our Opinion and Order of August 25, 1988 (hereinafter referred to as "The Opinion" and "The Order", respectively) sustaining in part the Debtor's Objections to the Proof of Claim of Mid-Penn Consumer Discount *682 Company (hereinafter "the Claimant"), the Claimant filed a Motion seeking that we reconsider The Order and stay its enforcement. We addressed this Motion at the Debtor's confirmation hearing which, per The Order, was conducted on September 1, 1988. At that hearing, the Standing Chapter 13 Trustee recommended Confirmation of the Debtor's second Amended Plan in light of the disposition effected by the Order. The Claimant argued that we should re-open the record to allow testimony to be adduced from employees of the Pennsylvania Department of Banking (hereinafter "DOB"), who it contended would clear up the ambiguity which we found extant in 7 P.S. § 6213 K of the Pennsylvania Consumer Discount Company Act (hereinafter "CDCA") and the DOB's Regulation pertinent thereto at 10 PA.CODE § 41.3(d), in our discussion at pages 679-81 of The Opinion.
As we stated at that time and reiterated in our subsequent Order of September 2, 1988, granting the Claimant's Motion for Reconsideration in part, we were not willing to open the record to allow further testimony relative to the Objection to the Claim in issue. However, we were willing to give the parties, and any other parties who wished to do so in the capacity of amici curiae, an opportunity to address the issues of first impression which we discussed at pages 679-81 of The Opinion, i.e., what late charges were permissible under 7 P.S. § 6213 K and 10 PA.CODE § 41.3(d). We believed that this was the proper means by which the DOB could properly recite its interpretation of the statute and Regulation in issue and reasons therefor, as opposed to providing testimony. We therefore allowed to the Claimant and any amici supporting its position until September 30, 1988, to file a Brief addressing the Motion for Reconsideration, and the Debtor and any parties supporting his position until October 17, 1988, to respond. We also stayed entry of an Order confirming the Plan until this supplemental briefing was completed.
As it developed, we received timely amici Briefs from the DOB and the Pennsylvania Financial Services Association (hereinafter "PFSA"). The Claimant requested and was granted an brief extension until October 5, 1988, to file its Brief. The Debtor filed a very short and not very helpful Reply Brief on October 20, 1988.
The amici properly confine themselves to the issue of first impression concerning which we indicated that we would be receptive to further briefing in our Order of September 2, 1988. The DOB, while citing no statutory or regulatory authority for its position, contends, simply, that its reading of the reference to "the amount . . . in arrears" in 7 P.S. § 6213 K and "the amount in default" in 10 PA.CODE § 41.3(d), allows a licensee under the Pennsylvania Consumer Discount Company Act, 7 P.S. § 6201, et seq. (hereinafter "CDCA") to assess a late charge on "the total amount past due or then in arrears," rather than the amount of each monthly payment. The PFSA states that "others will argue in depth why the court's construction is contrary to the clear and unambiguous language of the statute," a prediction which never comes to fruition. It then devotes the remainder of its Brief to two contentions: (1) We should defer to the DOB's interpretation of the pertinent statute and regulation; and (2) We should defer to the "uniform practice of the lending industry" of computing late charges pursuant to the CDCA by reference to the sums of payments in default rather than only the payment for a given month.
The Claimant submitted a lengthy Brief addressing numerous issues relative to the Objection in issue. A sizable portion is devoted to whether we properly applied our own prior decision in In re Lewis, 80 B.R. 39 (Bankr.E.D.Pa.1987), to the record at hand in concluding that the Claimant had the burden of vindicating the "late charge" component of its claim. The propriety of our striking the portion of the claim designated as "additional late charges" is briefly revisited. Tables setting forth four separate "late charge" calculations are included, including an admission that the $486.06 figure previously claimed was in error and should have been $458.82, and vigorously contending that it did not compound late *683 charges in its calculations, as we suggested it may have done at pages 679-80 of The Opinion. At the outset, two pages are even devoted to an argument that we never should have considered the Debtor's Objections to its Proof of Claim on its merits at all because the Debtor's counsel did not file and serve his previous pleadings punctually!
We believe that each of the parties submitting Briefs on the Claimant's behalf were laboring under some misconceptions. First, as to the Claimant, we thought our Order of September 2, 1988, and our statements in court on September 1, 1988, had made it clear that we were reconsidering only that portion of The Opinion relating to the proper means of computing late charges under 7 P.S. § 6213 K and 10 PA.CODE § 41.3(d). Thus, we envisioned briefing on this issue alone. Our Order of September 2, 1988, clearly stated that we were not receptive to supplementation of the record with additional evidence. Therefore, we will not consider the Claimant's Tables in the same light as if they had been presented as evidence at the hearing on July 5, 1988. We will consider them only, as they appear to have been presented, as illustrative of the computation process utilized by the Claimant under the CDCA.
The amici seem to have clearly grasped this point, as they address only the issue that we anticipated reconsidering, i.e., the proper interpretation of 7 P.S. § 6213 K and 10 PA.CODE § 41.3(d). However, both express the somewhat mistaken impression that The Opinion definitively held that late charges could be computed, under those statutory and regulatory provisions in issue, only on the payment due for a particular month. To the contrary, in The Opinion, as illustrated by our statements at pages 678 and 680, we merely expressed our doubt that the assumption of the Claimant that it could compute the late charge on the entire balance due was correct.
In any event, we believe that our Order of September 2, 1988, indicated quite clearly that we did not intend to reconsider our holdings, in The Opinion, that the Claimant had the burden of proving, at the hearing of July 5, 1988, that its asserted late charge of $486.06 was accurate and that this burden was not sustained by it at that hearing. Moreover, even were we to do so, our decision on that score would be sustained.
Contrary to the claimant's contentions, the scenario presented here is not the first (no objection filed to proof of claim) nor the third (no evidence presented at the hearing on the Objection) of the five potential scenarios in which objections to proofs of claim come before us recited in Lewis, 80 B.R. at 39, 40. Rather, we were clearly presented with the fifth scenario (both parties presented testimony relative to the objection at the hearing). As we later reiterated in In re Celona, Celona v. Equitable National Bank, 90 B.R. 104, 108-09 (Bankr.E.D.Pa.1988), once an objector raises an objection to a claim and provides any evidence tending to dispute a claim, "the claimant will prevail only in the amount that it would be awarded at a trial or hearing, in which the burden of proving its case by a preponderance of evidence [is] upon the claimant." Lewis, supra, 80 B.R. at 41. We cited The Opinion in this case with approval in Celona, at 109. Any contention that the principles enunciated in The Opinion here were contrary to or reconsidered even in part in Celona is therefore misplaced.
As we previously pointed out in The Opinion, at page 679, the facts here were analogous to those of Lewis in numerous relevant respects. The debtor there presented testimony relating only to the mortgage payments she claimed to have made. 80 B.R. at 42. She made no reference to late charges, but merely claimed that she owed a figure which did not include such charges. The mortgagee, while successfully rebutting many of the debtor's contentions, "made no showing of how its claim for late charges was computed." Id. at 43. We declined to take judicial notice of "the potentially uncertain means by which such charges are computed," citing In re Andrews, 78 B.R. 78 (Bankr.E.D.Pa. 1987). 80 B.R. at 43. Consequently, all *684 late charges claimed by the mortgagee there were denied. Id. at 43, 44.
Practically, the burden of proving a claimant's right to late charges in its claim could scarcely be allocated otherwise. A debtor could hardly be expected to prove a negative, i.e., to present evidence disproving the unknown reasoning and rationale of a claimant in contending that late charges which the debtor denies are justified are in fact due. The logic of allocation of the burden of proof is that it is necessarily placed on the party who has the most knowledge and best means of proof on a given issue at his disposal. Compare In re New York City Shoes, Inc., 86 B.R. 420, 425 (Bankr.E.D.Pa.1988) (landlord has burden of proving his own diligent efforts to replace an errant tenant); In re Crompton, 73 B.R. 800, 808-09 (Bankr.E.D.Pa. 1987) (debtor has burden of proving that his own statement of income and expenses satisfies the requirement that all of his projected disposable income is being paid into a Chapter 13 plan); and In re Furlow, 70 B.R. 973, 978 (Bankr.E.D.Pa.1987) (debtor has burden of proving the logic of his reasons for discriminating in his treatment of creditors). Clearly, the party having the most knowledge of computation of the late charges in issue here and the party upon which the burden of proof must therefore be placed is the Claimant.
The only burden of the Debtor is to raise a particular issue in reference to a claim. We do not agree with the Claimant's contention that the Debtor failed to put the issue of the legitimacy of the Claimant's late charge on the table of issues raised in his Objections. See pages 674-75 of The Opinion. Imposition of all late charges was definitely an explicit bone of contention, as expressed in the Objections. We fail to understand what specific evidence the Debtor could have been expected to put on to rebut the legitimacy of a charge the imposition of which he disputed and the calculation of which were totally beyond his comprehension. We also disagree with the Claimant's further contention that its witness, Frederick Robinson, sufficiently explained the calculations of the late charges. Despite the court's sua sponte efforts to assist the Claimant's cause by eliciting such testimony, we received only vague generalities in response from Mr. Robinson.
Furthermore, it is scarcely comforting to note that the Claimant now concedes that its previous calculation of $486.06 due in late charges, as opposed to its present calculation of $458.82 as the amount of late charges owed by the Debtor, was in error. Reminiscent of its previous concession of an over-statement in its calculations of "additional late charges" by almost $1,000.00, see pages 674 and 675 of The Opinion, this concession rebuts the notion that those calculations are characterized by mathematical certainty and precision.
By way of contrast, Mr. Robinson presented clear and copious documentation of the costs charged to the Claimant. Consequently, all Objections as to that component of the claim were rejected by us. See page 681 of The Opinion.
Similarly, we did not intend, in our Order of September 2, 1988, to reopen the issue of whether the Claimant could legitimately demand the component of its claim designated as "additional late charges" from the Debtor. The Claimant's comments on this score and its swipes at slightly-belated filings and alleged incompetency of the Debtor's counsel are misplaced. The court, in considering Objections to Proofs of Claim which jeopardize confirmation, cannot overlook the fact that interests of the Debtor's other creditors, none of which (nor the Trustee, their collective representative) objects to confirmation here, demand that legitimate objections raised to claims be decided on their merits rather than solely on the basis of the relative skill of opposing counsel.
We now address the sole issue concerning which we did contemplate be allowed reconsideration in our Order of September 2, 1988: how should late charges be properly computed under the CDCA?
We do not find the arguments of either the Claimant or the amici very persuasive on an intellectual level. Their recitations *685 do not cite to any judicial or administrative precedent. This observation reinforces our belief that this issue is truly a matter of first impression, and furthermore is one to which neither the legislature, the courts, or the regulating agency have given much critical consideration. None of the policy arguments which we recited in The Opinion points at pages 679-81 are rebutted by either the Claimant or the amici, i.e.: (1) Ambiguities in the law must be construed against allowance of additional charges; (2) Imposition of such substantial late charges such as are requested by the Claimant are in the nature of a penalty; and (3) The Claimant's method of calculation is much more generous to its interests than that regularly used by home-purchase mortgagees. E.g., Gambale v. Lomas & Nettleton Co., 80 B.R. 308, 310 (E.D.Pa.1987); Andrews, supra, 78 B.R. at 80-84; and In re Dangler, 75 B.R. 931, 933-35 (Bankr.E.D. Pa.1987).
We have, moreover, become aware of possibly controlling decision of the Third Circuit Court of Appeals in In re Tastyeast, Inc., 126 F.2d 879, 881-82 (3d Cir. 1942), which presents another line of reasoning supporting our actions of disallowing late charges to the Claimant. In that case, the Court of Appeals held that a bankruptcy court retains equitable power to disallow even non-usurious, contractually-agreed interest to a mortgagee when the amount sought is so disproportionate to the damages suffered by a mortgagee as a consequence of a default as to constitute a penalty for late payment. The Court also strongly states that the presence of inequality of bargaining power, which certainly appears to have been present here, is a factor in disallowance of such charges. Id. at 881. Accord, In re White, 88 B.R. 498, 510-11 (Bankr.D.Mass.1988); and In re Rolfe, 25 B.R. 89, 94 (Bankr.D.Mass. 1982), aff'd, 710 F.2d 1 (1st Cir.1983). On the authority of Tastyeast, we believe that we could and probably should deny all late charges requested by the Claimant, irrespective of what the CDCA may allow. The Claimant is already receiving pre-paid interest at a 25.4 annual percentage rate (APR) under the contract. No evidence of additional damages of anything close to $458.82 to the Claimant as a result of the Debtor's late payments has been suggested, much less supported by any evidence.
The citation of the Claimant and the PFSA to Schleeter v. Intrieri, 326 Pa.Super. 233, 473 A.2d 1067 (1984), is inapposite. Schleeter involved calculation of interest, a different element than the late charges which are sought to be imposed here in addition to an extremely high rate of interest in the contract, at 25.4 APR. It also cannot be overlooked that the Schleeter court recomputed a lower court award more generous to the mortgagee to provide the mortgagor with 15 percent interest on its money and no more. Here, it is the very lack of connection between the late charge imposed and the financial consequences to the Claimant which motivated our skepticism of the legitimacy of the Claimant's calculation of the late charges imposed. See The Opinion at page 681.
We also question whether the principle that deference must be accorded to a regulating agency's interpretation of a statute applies to anywhere near the same degree here as in the situations in the cases cited by the Claimant and the PFSA, if at all. Here, the DOB is merely giving a legal opinion. It has not promulgated any official regulation or interpretation construing the statute and regulation in issue. It is not defending an administrative interpretation of the regulation which it made in a proceeding involving the public fisc or involving its interests at all. Its counsel is simply, like us, looking at the words of an ambiguous statute and regulation and opining as to its interpretation.
We cannot equate the DOB's pronouncements here with that of a formal regulation or interpretation. Compare, e.g., Ford Motor Credit Co. v. Milhollin, 444 U.S. 555, 563-70, 100 S.Ct. 790, 795-96, 63 L.Ed.2d 22 (1980) (Official Staff Interpretation of *686 Truth-in-Lending Act by Federal Reserve Board must be accorded deference); E.I. duPont deNemours & Co. v. Train, 430 U.S. 112, 116-24, 97 S.Ct. 965, 969-73, 51 L.Ed.2d 204 (1977) (deference accorded to regulations promulgated by Federal Environment Protection Agency under statutorily-mandated procedure); Masland v. Bachman, 473 Pa. 280, 374 A.2d 517 (1977) (deference accorded to officially-promulgated state regulation). An official regulation or interpretation is promulgated only after some rule-making process occurs within an administrative agency. See 45 Pa.S. §§ 1201-08; and A.E. BONFIELD, STATE ADMINISTRATIVE RULE MAKING 255-396 (1986).
Also, the DOB's Brief fails to recite any factual basis or findings which support its interpretations. An agency normally supports promulgation of official regulations with factual findings. See generally 1 K. DAVIS, ADMINISTRATIVE LAW TREATISE 447-634 (2d ed. 1978). No facts supporting the DOB's interpretation are included in its Brief. The DOB's Brief merely presents, without any indication of a basis other than the ambiguous words of the pertinent CDCA statutory provision and regulation, what the DOB believes is the proper interpretation of this language.
The consideration of deference to an agency's interpretations is certainly considerable when a lawsuit involves a direct attack upon the agency's own interpretation of a regulation in a legal matter to which the agency is a party. See, e.g., duPont deNemeurs, supra; Carol Lines v. Pennsylvania Public Utility Comm'n, 83 Pa.Cmwlth. 393, 477 A.2d 601 (1984); Spicer v. Commonwealth Dep't of Public Welfare, 58 Pa.Cmwlth. 558, 428 A.2d 1008 (1981); and Beneficial Consumer Discount Co. v. Whitesell, 45 Pa.Cmwlth. 156, 404 A.2d 794 (1979). This is especially true when, as in Carol Lines and Spicer, the public fisc may be jeopardized by a court interpretation at variance from that of the agency. Here, the DOB is not a party to the action. The public fisc is in no way affected. Hence, the DOB has little stake in this matter and its views constitute strictly its own abstract interpretation of the statute and regulation at hand.
Nevertheless, the mere fact that the DOB has taken a certain interpretative position, which was not before us when we issued The Opinion, is an element entitled to some weight, no matter what context in which it is delivered. 1 Pa.C.S. § 1921(c)(8). The context is relevant only to the weight to be given to the agency's interpretation. Cf. United Services Automobile Ass'n v. Muir, 792 F.2d 356, 362 (3d Cir.1986) (administrative interpretation has insufficient weight to "settle" law for purposes of abstention under Railroad Comm'n of Texas v. Pullman, 312 U.S. 496, 61 S.Ct. 643, 85 L.Ed. 971 (1941)). Here, we cannot give a great deal of weight to the DOB's statements.
The DOB clearly expresses its view that the use of the phrase "the amount in arrears" in 7 P.S. § 6213 K and the phrase "the amount in default" in 10 PA.CODE § 41.3(d) permit a CDCA licensee to compute late charges on the entire amount due. It then goes on to calculate, in almost blase fashion, the huge sum of late charges which results from its prescribed method of calculation, i.e., a maximum sum of $1,298.70 at the end of a 36-month contract such as in issue here.[1] Moreover, were it *687 not for the intervention of the bankruptcy, the "additional late charges" sought by the Claimant would apparently, according to the DOB, also be collectible. See pages 677-78 of The Opinion.
The Debtor, it will be recalled, only borrowed about $3,000.00. Id. at 675. However, by use of the DOB's calculations, he would have to repay the original $4,680.00 including pre-computed interested at 25.4 percent, plus $1,298.70, or a total of almost $6,000.00 in the event that no payments were made after 36 months. Thus, he would be obliged to pay almost twice what he borrowed. This results in an effective annual percentage rate, in the transaction, when the interest and late charges are combined, approaching 50 percent.[2] Moreover, except for the intervention of bankruptcy, the "additional late charge" meter would still be running.
These observations would seem to us to cause the DOB to stop and wonder whether this method of calculation of late charges, with its pyramiding effect, was really what the legislature intended in using the language which it did in 7 P.S. § 6213 K. We would certainly expect such a rather unusual result to be spelled out more clearly in the statute if that was the intent.
We also note that the legislature expressly stated that "due notice" of the intention to collect late charges must be provided in the contract. 7 P.S. § 6215. We question whether the ambiguous contract language, see page 675 of The Opinion, fulfills this prerequisite.
Our observations of the consequences of interpreting the pertinent law and regulation otherwise should, if anything, heighten the attention due to the fact that home-purchase mortgagees consistently interpret late-charge provisions in their documents to allow late charges to be computed on only the current monthly payment. See, e.g., Gambale, Andrews, and Dangler, supra. We also note that the Uniform Consumer Credit Code, drafted in 1974, almost forty years after the CDCA, is more specific, and allows late charges of "not more than five per cent of the unpaid amount of the installment (emphasis added)." 7A UNIFORM LAWS ANNOTATED, § 2.502 (1985). This is, of course, how we suggest the CDCA could and should be read.
We therefore stand by our contentions that the interpretation of the statute and regulation urged by the Claimant and its *688 amici is doubtful, given the considerations that Pennsylvania law discourages unconscionable methods of calculating finance charges and refuses to enforce contract provisions which measure liquidated damages by amounts which are excessive in comparison with the damages suffered as a consequence. See pages 679-81 of The Opinion.
Because of our observations in cases involving claims for late charges by home-purchase mortgagees, we cannot attach great significance to the argument of the PFSA that all of its members calculate late charges under the CDCA in the same manner as the Claimant. It is not surprising that interested, sophisticated lenders consistently interpret ambiguous laws to their own advantage and to the disadvantage of their obviously less-sophisticated customers. This data only highlights the need of the disinterested courts to be vigilant to prevent industry-wide overreaching.
We therefore conclude that the articulated interpretation of the statute and regulation in issue by the DOB, though a factor, does not convince us that any of the reasoning of The Opinion was mistaken. We do, however, again observe that it was not necessary for us in The Opinion and is not necessary here to conclusively determine what late charges the CDCA would allow, since this issue is not determinative of the matter of the claim before us.
We reiterate that, here, The Order accompanying The Opinion was not conclusively based on any particular interpretation of 7 P.S. § 6213 K and 10 PA.CODE § 41.3(d). It was based on the failure of the Claimant to establish, on the record, the basis of its calculation for its requested late charges. The Opinion considered the ambiguity of the applicable law merely as an illustration as to why the claimant's calculation of late charges could not be assumed to be correct, and therefore would not be allowed as an element in its proof of claim, unless such calculations had been proven to be justified and accurate. By way of comparison, we did not doubt that the relatively conservative claim for late charges by the mortgagee in Lewis could have been explained by the mortgagee by reference to calculations which were in no sense violative of the law or the terms of the mortgage. However, we denied the mortgagee's claims in Lewis because, like the claimant here, the mortgagee there failed to meet its requisite burden of proving the basis for the late charges demanded on the record at the hearing on the Objections to its proof of claim.
Further, the Tastyeast decision suggests that, for equitable reasons, a bankruptcy court could decline to include all of the late charges sought by the Claimant as a portion of its allowed claim even if they were allowable under the CDCA. We therefore see no basis to reconsider the equitable result of denying such substantial late charges reached by The Order.
We have observed some typographical errors in The Opinion, and we shall enter an Order correcting these. However, we shall not withdraw The Opinion, but reiterate it insofar as it is further supported by our observations expressed here. We will reiterate that portion of The Order establishing the Claimant's allowed secured claim as $4,404.55. In the Order, we also indicate our intention to execute an Order approving the Trustee's Report and enter an Order confirming the Debtor's most-recently-amended Plan upon receipt of the said Report.
NOTES
[1] Although the Claimant has not, as we indicate hereinafter at pages 679-81 infra, indicated precisely how it did calculate the purported "late charges" of $486.06, it is clear that this figure is more than if it were calculated at 1½% of the monthly payments of $130.00, which would result in "late charges" of no more than $1.95 per month and a maximum total of $70.20 even if all 36 payments were late.
[2] We also observe that the Federal Trade Commission has promulgated a regulation prohibiting "pyramiding" of late charges, i.e., imposing late charges attributable solely to prior imposition of late charges, at 16 C.F.R. § 444.4. The Commentary to Rule reveals a broad federal concern with late charge policy which duplicate penalties for late payments in prior months, as does the Claimant's computation method utilized here. See 49 Fed.Reg. 7770-72 (March 1, 1984).
[1] The Brief of the DOB states the following, at pages 5-6:
"The interpretation that the default charge [proffered by the DOB] is based on the amount in arrears, and not on the amount of the installment, logically incorporates a progression from the $1.95 charge after the first month, to the $70.20 charge after the maturity of the loan. For example,
Month Default Charge
1 $ 1.95 ($130 × .015)
2 $ 3.90 ($260 × .015)
3 $ 5.85 ($390 × .015)
4 $ 7.80 ($520 × .015)
5 $ 9.75 ($650 × .015)
6 $11.70
7 $13.65
8 $15.60
Month Default Charge
9 $17.55
10 $19.50 ($1300 × .015)
11 $21.45
12 $23.40
13 $25.35
14 $27.30
15 $29.25
16 $31.20
17 $33.15
18 $35.10
19 $37.05
20 $39.00 ($2600 × .015)
21 $40.95
22 $42.90
23 $44.85
24 $46.80
25 $48.75
26 $50.70
27 $52.65
28 $54.60
29 $56.55
30 $58.50 ($3900 × .015)
31 $60.45
32 $62.40
33 $64.35
34 $66.30
35 $68.25
36 $70.20 ($4680 × .015)
The total default charge in this example would be the sum of the charges or $1,298.70."
By summing the late charges due for each month, the DOB's calculations allow a pyramiding of late charges. For example, in Month 2, the lender is being permitted to collect the charges for month 1 plus the charges for month 2, or three times the 1½ percent late charge. By month 10, the lender is permitted to collect the charge for month 10, plus the sum of the charges from each of the prior months.
[2] A finance charge of $2,700.00 on a loan of $3,000.00 for a period of 36 months constitutes an annual percentage rate of over 47.5 percent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2749773/ | In The
Court of Appeals
Ninth District of Texas at Beaumont
____________________
NO. 09-13-00573-CR
____________________
RAMON AGUILAR JR., Appellant
V.
THE STATE OF TEXAS, Appellee
______________________________________________________ _
On Appeal from the 9th District Court
Montgomery County, Texas
Trial Cause No. 13-11-12564 CR
_______________________________________________________ _
ORDER
The clerk’s record in the above styled and numbered cause was filed
February 3, 2014, a supplemental clerk’s record was filed on June 13, 2014,
and the reporter’s record was filed February 10, 2014. On April 17, 2014, the
Court granted an extension of time to file the brief, noting that the extension
was a “FINAL EXTENSION.” On October 24, 2014, the appellant’s court-
appointed attorney, Jarrod Walker, was notified that neither the brief of the
appellant nor a motion for extension of time to file the brief has been filed.
1
Although the brief of the appellant was due to be filed Monday, June 30, 2014,
the brief has not been filed.
We abate the appeal and remand the case to the trial court to conduct a
hearing at which a representative of the State, counsel for the appellant, and the
appellant shall be present in person. See Tex. R. App. P. 38.8(b)(3). If the
appellant is not incarcerated, but fails to appear at the hearing after having been
notified to do so, or after reasonable attempts to notify him have been made,
then the trial court may enter a finding that appellant no longer desires to
pursue the appeal and send said finding to this Court. See Tex. R. App. P.
38.8(b)(4). If the appellant is present for the hearing, we direct the trial court to
determine whether or not appellant desires to pursue his appeal. If appellant
desires to pursue his appeal, we direct the trial court to determine why the brief
of the appellant has not been filed, why appellant’s counsel has not responded
to late notices from this Court, and whether good cause exists for appointed
counsel, Jarrod Walker, to be relieved of his duties as appellate counsel and
replaced by substitute counsel. See Tex. Code Crim. Proc. Ann. art. 26.04(j)(2)
(West Supp. 2014). If the trial court determines that good cause exists to relieve
appointed counsel of his duties, we direct the trial court to appoint substitute
counsel.
2
The record of the hearing, including any orders and findings of the trial
court judge, shall be sent to the appellate court for filing. The court reporter’s
record from the hearing and the clerk’s record containing the recommendations
of the trial court judge are to be filed on or before December 8, 2014.
ORDER ENTERED November 6, 2014.
PER CURIAM
Before McKeithen, C.J., Horton, and Johnson, JJ.
3 | 01-03-2023 | 11-08-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1614308/ | 939 So. 2d 46 (2006)
STATE DEPARTMENT OF HUMAN RESOURCES
v.
A.J.T.
A.J.T.
v.
State Department of Human Resources.
2050024.
Court of Civil Appeals of Alabama.
March 24, 2006.
Troy King, atty. gen., and Sharon E. Ficquette and Elizabeth Hendrix, asst. attys. gen., Department of Human Resources, *47 for appellant/cross-appellee State Department of Human Resources.
Jerry Wayne Baker, Jr., Albertville; and A. Dalton Chandler, Albertville, guardian ad litem, for appellee/cross-appellant A.J.T.
CRAWLEY, Presiding Judge.
In May 2002, the State Department of Human Resources ("DHR") received a report that five children were being left at home alone. Upon investigation, DHR discovered that the children, G.M.A., T.A.A., A.D.A., A.J.A., and F.M.T., whose ages ranged from eight to one, were being left at home by their mother, D.A., who had a methamphetamine addiction, and A.J.T., the father of A.J.A. and F.M.T. DHR instituted a safety plan that allowed the children to remain in the home provided that A.J.T. supervised the children's contact with the mother and that the mother was not left alone with the children. However, the parties failed to comply with the safety plan; A.J.T. would go to work, leaving the mother alone with the children, and the mother would then leave the children unattended. The children were then placed with a friend of the family for supervision while DHR instituted services for the family. The mother, however, was not cooperative with DHR, refusing to take drug tests and failing to otherwise adjust her circumstances to meet her children's needs. Her parental rights were ultimately terminated in December 2003, and she is not involved in the present appeal.
In September 2002, when the children's custodian informed DHR that she would need to leave the state for a family emergency, DHR placed the children in foster care. DHR filed a petition to terminate the parental rights of A.J.T. in September 2003. After a trial in June 2005, the trial court terminated A.J.T.'s parental rights but granted him visitation with A.J.A. and F.M.T. every other weekend. DHR filed a postjudgment motion in which it argued that the trial court could not properly award visitation to A.J.T. while also terminating his parental rights and awarding permanent custody of the children to DHR. After a hearing on that motion, the trial court amended its judgment to award A.J.T. 48 hours of visitation each month, the timing of which was to be determined by DHR, the foster parents, or the adoptive parents of the children. DHR appeals, arguing that the trial court erred by awarding A.J.T. visitation after terminating his parental rights; A.J.T. cross-appeals, arguing that the termination of his parental rights was not supported by the evidence. We reverse.
This court has held that a judgment terminating parental rights but reserving certain parental rights to the parent is contradictory. B.C.M. v. H.E.C., 907 So. 2d 445, 446 (Ala.Civ.App.2005). Although the juvenile court in B.C.M. specifically terminated only the mother's right to object to the adoption of her child and reserved to her the right to visit with the child and to be involved in the child's schooling and activities, this slight difference between the cases is inconsequential. A judgment terminating the parental rights of a parent and awarding permanent custody of a child to DHR gives DHR the right to make permanent plans, including adoption, for that child. Ala. Code 1975, § 26-18-8(1). To reserve to the parent any right is diametrically opposed to the fundamental principles underlying the termination of parental rights. A termination of parental rights should be accomplished only in the most egregious of circumstances, is to be based on a determination that the parent is unwilling or unable to provide for the child and that the circumstance or condition resulting in *48 the parent's unwillingness or inability to provide for the child is unlikely to change in the foreseeable future, should occur only after consideration of all possible viable alternatives to termination, and must be in the child's best interest. Ex parte Beasley, 564 So. 2d 950, 954 (Ala.1990). To terminate parental rights and yet award visitation indicates that the trial court must think that continued contact between the parent and the child is in the child's best interest and that the complete severance of the parent-child relationship is not. Accordingly, we must reverse the trial court's judgment and remand this cause for the trial court to determine, based on the evidence presented at trial, whether A.J.T.'s rights should be terminated without the reservation of visitation or whether termination of A.J.T.'s parental rights is not truly in the best interest of the children.
In light of our disposition of DHR's appeal, we dismiss A.J.T.'s cross-appeal as being moot.
APPEALREVERSED AND REMANDED WITH INSTRUCTIONS.
CROSS-APPEALDISMISSED AS MOOT.
THOMPSON, PITTMAN, MURDOCK, and BRYAN, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614310/ | 331 N.W.2d 576 (1983)
STATE of South Dakota, Plaintiff and Appellee,
v.
Dale E. GRIFFEE, Defendant and Appellant.
No. 13928.
Supreme Court of South Dakota.
Argued February 15, 1983.
Decided March 30, 1983.
Richard Dale, Asst. Atty. Gen., Pierre, for plaintiff and appellee; Mark V. Meierhenry, Atty. Gen., and Judith A. Atkinson, Asst. Atty. Gen., Pierre, on the brief.
John P. Abbott of Abbott & Abbott, Brandon, for defendant and appellant.
WOLLMAN, Justice.
This is an appeal from an order committing defendant to the State Penitentiary pursuant to an earlier judgment of conviction. We affirm.
On February 8, 1982, defendant pleaded guilty to a charge of sexual contact with a child under the age of fifteen years. SDCL 22-22-7. The trial court sentenced defendant to five years' imprisonment in the State Penitentiary, "with said sentence being suspended until March 10, 1983, with the Court to consider modification of sentence after February 1, 1983, and before March 10, 1983." At the time the above described judgment was entered against him, defendant had been convicted of two prior feloniesindecent molestation of a child and grand theft.
Following an incident between defendant and a fourteen-year-old boy in Faywick Park in Sioux Falls on May 8, 1982, the State filed a complaint charging defendant with attempting to engage in sexual contact with a child under the age of fifteen years. On July 12, 1982, the State filed a motion to revoke the suspended sentence that the trial court had entered in February of 1982. Following a hearing on the motion, the court entered findings of fact, conclusions of law, and an order. The order read in part "that the Judgment and Sentence of this court dated February 12, 1982 is modified to the extent that the said Defendant *577 Dale E. Griffee shall be forthwith transported to the South Dakota State Penitentiary."
Defendant contends that the trial court violated the due process requirements imposed by the United States Supreme Court's decisions in Morrissey v. Brewer, 408 U.S. 471, 92 S. Ct. 2593, 33 L. Ed. 2d 484 (1972), and Gagnon v. Scarpelli, 411 U.S. 778, 93 S. Ct. 1756, 36 L. Ed. 2d 656 (1973), on parole and probation revocation proceedings. We do not reach that contention, however, because it is clear that the trial court did not have jurisdiction to either suspend the imposition of sentence and place defendant on probation or to suspend the execution of sentence and place defendant on probation in view of defendant's prior felony convictions.
SDCL 23A-27-12 provides:
After conviction of an offense not punishable by death or life imprisonment, a defendant may be placed on probation. This section shall apply only to persons who are convicted of a felony for the first time and misdemeanor offenders.
SDCL 23A-27-13 provides in part:
Upon receiving a verdict or plea of guilty for a misdemeanor or felony not punishable by death or life imprisonment by a person never before convicted of a crime which at the time of conviction thereof would constitute a felony in this state, a court having jurisdiction of the defendant, when satisfied that the ends of justice and the best interest of the public as well as the defendant will be served thereby may, without entering a judgment of guilt, and with the consent of the defendant, suspend the imposition of sentence and place the defendant on probation for such period and upon such terms and conditions as the court may deem best.
SDCL 23A-27-18 provides:
Upon conviction of any misdemeanor or upon the first conviction in this state of a felony, the court having jurisdiction to try the offense may suspend the execution of any sentence imposed during good behavior, subject to such conditions or restitutions as the court may impose. The suspension order or judgment can be made only by the court in which the conviction occurred.
The trial court stated at the so-called revocation hearing that:
[W]hat I did was I stayed execution of the sentence for a period of one year. It is my opinion that the Court has virtually unbridled discretion as to whether or not to stay execution of a sentence and that during the period that a stay has been granted the Court has virtually unbridled discretion to discontinue that stay.
We do not agree with the trial court's analysis of its jurisdiction to stay a sentence. SDCL 23A-33-1 authorizes a trial court to stay execution of a sentence for a period not to exceed thirty days in the event a defendant announces his desire to appeal. Likewise, SDCL 23A-33-2 authorizes the stay of sentence of imprisonment if an appeal is taken and the defendant is admitted to bail. We have been directed to no statute that gives the trial court unbridled discretion to stay execution of sentence. Indeed, if the trial court's position in this case were upheld it would mean that trial courts could circumvent the legislative will, clearly expressed in the above quoted statutes, that there shall be no suspension of imposition of sentence or suspension of execution of sentence for a defendant who has been convicted of a prior felony. This legislative restriction on the power of the trial courts is quite clearly authorized by South Dakota Constitution art. V, § 5, which provides in part that "Imposition or execution of a sentence may be suspended by the court empowered to impose the sentence unless otherwise provided by law." (Emphasis added.)
"The power to suspend imposition of sentence is not a power inherent in the courts or legislature of this state. It is a power, which like that of suspended execution of sentence, had to be granted by constitutional amendment." State v. Marshall, 247 N.W.2d 484, 486 (S.D.1976). Likewise, "[t]he source of sentencing power derives *578 from constitutional or statutory provisions." State v. Poor Thunder, 302 N.W.2d 412, 413 (1981).
Our holding in the instant case is governed by State ex rel. Grant v. Jameson, 70 S.D. 369, 17 N.W.2d 714 (1945), wherein this court held that the trial court was without power or authority to suspend a prior offender's sentence, with the result that the purported suspension order was void. Likewise, we follow the holding in the Jameson case in affirming the trial court's order committing defendant to the State Penitentiary:
There is no question presented concerning the validity of the judgment of conviction. This judgment being valid and not having been completely served, petitioner was lawfully imprisoned thereunder. Where the suspension order is void it does not prevent the subsequent enforcement of the judgment, which may be enforced at any time after its rendition, so long as it remains unexecuted.
70 S.D. at 371, 17 N.W.2d at 714.
The order of August 2, 1982, directing that defendant be committed to the State Penitentiary to serve the sentence imposed by the judgment of conviction of February 12, 1982, is affirmed.
All the Justices concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614318/ | 111 Wis. 2d 643 (1983)
331 N.W.2d 614
STATE of Wisconsin EX REL. John H. PFLAUM, Petitioner-Appellant,
v.
State of WISCONSIN PSYCHOLOGY EXAMINING BOARD; Donald R. Rittel, Hearing Examiner, Respondents.[]
No. 82-909.
Court of Appeals of Wisconsin.
Submitted on briefs January 12, 1983.
Decided February 14, 1983.
For the petitioner-appellant the cause was submitted on the brief of Alan D. Eisenberg, S.C., of Milwaukee.
For the respondent the cause was submitted on the brief of Bronson C. La Follette, attorney general, and Daniel D. Stier, assistant attorney general.
Before Decker, C. J., Moser, P. J. and Wedemeyer, J.
WEDEMEYER, J.
Dr. John H. Pflaum (Pflaum) appeals from a judgment of the trial court affirming an *644 order of a hearing examiner for the State Psychology Examining Board (PEB). The order of the hearing examiner compelled Pflaum to disclose the names, addresses and telephone numbers of the four individuals on whom Pflaum used an electrical device known as MELS. We determine that the psychologist-patient privilege (sec. 905.04, Stats.) is inapplicable to this case, because the individuals whose identity Pflaum wishes to protect were never patients of Pflaum, as "patient" is defined in sec. 905.04(1) (a).
The PEB instituted disciplinary proceedings against Pflaum by filing a complaint, which was subsequently amended. Pflaum answered both the complaint and the amended complaint, and the PEB then initiated discovery.
Interrogatory questions were sent to Pflaum. The pertinent questions sought to elicit the following information: the number of persons on whom MELS was used; whether those persons were patients, clients, subjects or volunteers; the manner in which MELS was used; and the names, addresses and telephone numbers of those individuals. Pflaum's responses were: only four individuals were subject to the MELS experiment; these four people were volunteer research subjects; MELS was used on these individuals for the purpose of testing; and disclosure of the names, addresses and telephone numbers of the four people was privileged under sec. 905.04, Stats.
[1]
Section 905.04(1) (a), Stats., states: "A `patient' is a person who consults or is examined or interviewed by a physician, chiropractor or psychologist." The Federal Advisory Committee's Note to proposed Standard 504(a) (1)[1] of the Federal Rules of Evidence, states in pertinent *645 part: "The definition of patient does not include a person submitting to examination for scientific purposes." Wisconsin Rules of Evidence, 59 Wis. 2d R126 (1973). The Judicial Council Committee's Note to sec. 905.04(1) (a), states, in pertinent part: "The same patient relationship that existed under Wis. Stats. s. 885.21[2] is maintained." Wisconsin Rules of Evidence, 59 Wis. 2d R123 (1973). We agree with both comments as they define "patient." It is clear that since all four of the individuals subject to the MELS experiment were volunteers helping Pflaum engage in scientific research, they were not patients as defined in sec. 905.04(1) (a), Stats. Therefore, the psychologist-patient privilege does not apply to this case.
Pflaum also argues that the disclosure of the identities of the four volunteers violates their constitutional right of privacy. Although Pflaum has raised this issue for the first time on appeal, we will review this issue. See Allen v. Allen, 78 Wis. 2d 263, 270-71, 254 N.W.2d 244, 248 (1977).
The right of privacy is not explicitly mentioned in the United States Constitution. The United States Supreme *646 Court has never recognized a general constitutional right to privacy. The Court has recognized that some Bill of Rights's provisions are concerned with privacy. See J.P. v. DeSanti, 653 F.2d 1080, 1087 (6th Cir. 1981) (lists examples). In Whalen v. Roe, 429 U.S. 589 (1977), a case involving a New York statute requiring that the names and addresses of all persons who are prescribed certain drugs be recorded by the state's central computer file, the Court stated:
The cases sometimes characterized as protecting "privacy" have in fact involved at least two different kinds of interests. One is the individual interest in avoiding disclosure of personal matters, and another is the interest in independence in making certain kinds of important decisions. Id. at 598-600. [Footnotes omitted.]
[2]
We do not believe the Supreme Court's language in Whalen, enunciated a general right of nondisclosure against which governmental action must be weighed. See J.P. v. DeSanti, supra, at 1089-90. The right of privacy is limited to those personal rights that can be deemed "fundamental" or "implicit in the concept of ordered liberty." Id. at 1090. The interest Pflaum wishes to assert here on behalf of his four volunteers, we conclude, is neither fundamental nor implicit to a concept of ordered liberty. We do not believe that disclosure of the identities of the MELS volunteers implicated a constitutional right to privacy.
By the Court.Judgment affirmed.
NOTES
[] Petition to review denied.
[1] Congress struck proposed Standard 504 when considering enactment of the Federal Rules of Evidence. The only difference between proposed Standard 504(a) (1) and sec. 905.04(1) (a), Stats., is that Wisconsin uses "physician, chiropractor or psychologist" while the proposed Standard used "psychotherapist." The proposed Standard defined a "psychotherapist" as including a licensed psychologist engaged in the practice of psychology. For our purposes, then, the Federal Advisory Committee's Note is relevant and useful to a disposition of this case.
[2] Section 885.21, Stats., was the physician-patient privilege statute before Wisconsin adopted sec. 905.04, Stats. Section 885.21 and its predecessors were interpreted to apply only to cases in which physicians treated persons. See Rusecki v. State, 56 Wis. 2d 299, 316-17, 201 N.W.2d 832, 842 (1972); Schwartz v. Schneuriger, 269 Wis. 535, 544, 69 N.W.2d 756, 761 (1955); City of Racine v. Woiteshek, 251 Wis. 404, 406, 29 N.W.2d 752, 754 (1947). We agree with the Judicial Council Committee's Note in its implication that the patient must be "treated" for the privilege to apply. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614328/ | 939 So.2d 1078 (2005)
The STATE of Florida, Appellant,
v.
Vonda Denise CHRISTIE, Appellee.
No. 3D04-1214.
District Court of Appeal of Florida, Third District.
November 2, 2005.
Rehearing Denied December 7, 2005.
Charles J. Crist, Jr., Attorney General, and Jennifer Falcone Moore, Assistant Attorney General, for appellant.
Bennett H. Brummer, Public Defender and Howard K. Blumberg, Assistant Public Defender, for appellee.
Before LEVY, GREEN, and WELLS, JJ.
GREEN, J.
The State of Florida appeals the trial court's dismissal of its information against Vonda Denise Christie for child neglect with no bodily harm pursuant to sections 827.03(3)(a) and (c), Florida Statutes (2003). At issue in this case is whether a public school teacher can be deemed a "caregiver" for students during school *1079 hours, as that term is defined in section 827.01(1). We conclude that a public school teacher is a "caregiver," as defined by section 827.01(1), during school hours. Accordingly, we reverse the dismissal of the information.
The charges in this case stemmed from incidents where Christie, a public school teacher, stood by and did nothing while her teacher's aide bound certain students to their desks and/or to the blackboard with adhesive tape, in the classroom. The State charged Christie with five counts of child neglect with no bodily harm under sections 827.03(3)(a) and (c). That statute defines "neglect of a child" as a caregiver's failure or omission to provide a child with care or supervision. Section 827.01(1), in turn, defines "caregiver" as "a parent, adult household member, or other person responsible for a child's welfare."
Christie filed a motion to dismiss the complaint. She asserted that as a public school teacher, she was not a section 827.03(3) "caregiver" or "other person responsible for a child's welfare" if that section was read in pari materia with section 39.01(47), Florida Statutes (2003).[1] The State responded that the Chapter 39 definition of "other person responsible for a child's welfare" did not need to be superimposed on section 827.03. Moreover, the state argued that Christie was a section 827.03 "caregiver" because, as a school teacher, she stood in loco parentis to the students during school hours and was therefore an "other person responsible for a child's welfare." § 827.01(1), Fla. Stat. (2003). The trial court granted Christie's motion to dismiss. The State appealed.
We agree with the State that there is no need to refer to the section 39.01(47) definition of "other person responsible for a child's welfare" in considering a neglect charge under section 827.03. That is because we conclude that a teacher falls within the plain meaning of "caregiver" during school hours as that word is defined in section 827.01(1).
Section 827.03(3) criminalizes child neglect by a "caregiver." A "caregiver" in turn is statutorily defined as "a parent, adult household member, or other person responsible for a child's welfare." § 827.01(1), Fla. Stat. (2003). Since Christie was not the parent or adult household member of the student victims, the question becomes whether she is an "other person responsible" for their welfare during school hours. Contrary to the trial court's conclusion, there is nothing vague or ambiguous about the phrase "other person responsible for a child's welfare." Thus, because the statute's language is clear and unambiguous, the statute must be given its "plain and obvious meaning." Holly v. Auld, 450 So.2d 217, 219 (Fla. 1984). The plain and obvious meaning of "caregiver," in 827.01(1), has been applied to neglect prosecutions under 827.03(3). Durand v. State, 820 So.2d 381 (Fla. 5th DCA 2002).
We further agree with the State that teachers stand in loco parentis to the students during school hours.
A public school . . . owes a general duty of supervision to the students placed within its care. Case law is replete with instances of schools, principals and teachers being required to reasonably fulfill their duty to supervise students. The genesis of this supervisory duty is based on the school employee standing partially in place of the student's parents. Mandatory schooling has forced *1080 parents into relying on teachers to protect children during school activity.
Rupp v. Bryant, 417 So.2d 658, 666 (Fla. 1982) (citations omitted)(footnotes omitted); State v. D.T.W., 425 So.2d 1383, 1386 (Fla. 1st DCA 1983)(teachers act in loco parentis). See Nova Southeastern Univ. v. Gross, 758 So.2d 86 (Fla.2000)(college has duty to protect students from dangers in mandatory internship placement). A person who stands in loco parentis to a child during school hours must obviously be deemed a "person responsible for the child's welfare" under section 827.01(1).
Christie nevertheless urges that we are required to look at the Chapter 39 definition of "other person responsible for a child's welfare" as the Florida Supreme Court did in DuFresne v. State, 826 So.2d 272 (Fla.2002). Using the Chapter 39 definition, Christie maintains that public school teachers are excluded as an "other person responsible for a child's welfare." Contrary to Christie's argument, because the phrase "other person responsible for a child's welfare" has a plain and obvious meaning in everyday parlance, there is no need to resort to the statutory definition given in section 39.01(47) as in DuFresne.
In DuFresne, the supreme court was confronted with a constitutional vagueness challenge to a criminal statute because of the lack of a statutory definition for "mental injury." The court noted that in cases where the exact meaning of a term was undefined by the Legislature, the court had ascertained a meaning by reference to other statutory provisions as well as case law or the plain and ordinary meaning of a word or common usage. 826 So.2d at 275. The court further noted that "[w]hile the legislature may direct that statutes be read in pari materia, the absence of such a directive does not bar construing two statutes in that manner." Id. (citations omitted). Accordingly, the court opted to read the statutory definition of "mental injury" found in Chapter 39 in pari materia with section 827.03, Florida Statutes (2003).
DuFresne, however, does not mandate that chapter 39 always be read in pari materia with section 827.03. See S.J.C. v. State, 906 So.2d 1115, 1117 n. 1 (Fla. 2d DCA 2005) ("We are mindful of the supreme court's reading of chapter 39 in pari materia with section 827.03, Florida Statutes (2003), to define "mental injury." . . . We disagree with the State, however, that the supreme court's reading of these two statutes in pari materia creates a blanket proposition that these two statutes should always be read together.") (citations omitted).
The DuFresne court recognized, among other things, that in order to withstand a vagueness challenge, a statute must define the offense in a manner that does not encourage arbitrary and discriminatory enforcement. See 826 So.2d at 275. An adoption of Christie's argument in this case would precisely create just such an arbitrary and discriminatory result a private school teacher could be criminally charged with child neglect under the facts of this case, but a public school teacher could not, even though both perform the same duties during the course of a school day.
Moreover, to read these two statutes in pari materia in this case would actually defeat the underlying legislative purpose of both statutes, which is the general protection of children from neglect. See DuFresne, 826 So.2d at 276. That is because such a reading would serve to insulate from prosecution a group of adults public school teachers despite the fact that these adults stand in loco parentis to the students that they oversee during school hours. "[T]he public interest is in education, upon which society places a high value. It requires an orderly atmosphere which is free from danger and disruption." *1081 D.T.W., 425 So.2d at 1386 (citations omitted). We find no logic to Christie's argument, which counters the plain dictate of section 827.03(3).
Accordingly, for all of the foregoing reasons, we reverse the dismissal of the State's information and remand this cause for is reinstatement.
Reversed.
NOTES
[1] Section 39.01(47), in pertinent part, defines "[o]ther person responsible for a child's welfare" as "the child's legal guardian, legal custodian, or foster parent; an employee of a private school, public or private child day care center[.]" | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/580710/ | 960 F.2d 327
Prod.Liab.Rep. (CCH) P 13,140Richard BORMAN and Joanne Borman, his wife, Joanne Borman,Executrix of the last will of Richard Bormanv.RAYMARK INDUSTRIES, INC., Keene Corporation, Eagle-PicherIndustries, Inc., Owens-Corning Fiberglas Corporation,Owens-Illinois Glass Company, Celotex Corporation,Fibreboard Corporation, GAF Corporation, Turner-Newall, PLC,Garlock, Inc.v.NICOLET, INC.Celotex Corporation, Appellant.
No. 89-2110.
United States Court of Appeals,Third Circuit.
Argued Aug. 2, 1990.Decided March 30, 1992.
Marc W. Reuben (argued), Bruce H. Bikin, Montgomery, McCracken, Walker & Rhoads, Philadelphia, Pa., for appellant.
Martin Greitzer (argued), Kirk V. Wiedemer, Greitzer & Locks, Philadelphia, Pa., for appellee, Joanne Borman, Executrix and in her own right.
Before: SLOVITER, Chief Judge*, SCIRICA and ALITO, Circuit Judges.
OPINION OF THE COURT
SCIRICA, Circuit Judge.
1
In this diversity case involving asbestosis, the district court declined to charge the jury on the apportionment of decedent's damages between cigarette smoking and asbestos exposure. Because we predict that the Pennsylvania Supreme Court would not find a reasonable basis for apportionment in this case, we will affirm.
I.
2
Richard Borman worked as an insulator at various locations and with various employers from 1956 to 1987, when he became unable to work. During the first thirteen years, he came in daily contact with asbestos products manufactured by the appellant, Celotex. He also smoked over a pack of cigarettes a day for thirty-five years (1950-1985). In 1985, he was diagnosed as having asbestosis, and in 1988, lung cancer. In that same year, he died of lung cancer.
3
On February 11, 1987, he and his wife filed suit in district court against several manufacturers of asbestos products, including Celotex. The complaint alleges that occupational exposure to these products caused Mr. Borman's disability1 and that defendants should be strictly liable for failure to warn of the products' dangerous propensities.2 Before trial, several defendants, later joined by Celotex, asked the trial judge to "instruct the jury to allow apportionment of the harm alleged by the plaintiff between that caused by cigarette smoking and that caused by exposure to asbestos." The motion was taken under advisement.
4
On August 15, 1989, trial commenced on a reverse bifurcated basis against the non-settling defendants, including Celotex. At the conclusion of testimony, the trial judge found that there was no reasonable basis for apportionment of damages,3 and denied the request for charge.4 Subsequently, the jury returned a verdict on damages, awarding $532,719 to Mrs. Borman and the estate of her husband. Later, the jury returned a verdict on liability against Celotex but exonerated the remaining defendant.
5
Celotex moved for a directed verdict and/or j.n.o.v., and a new trial, asserting inter alia that the evidence warranted an apportionment of damages charge and did not support damages for lost wages. The trial court denied this motion in an order without opinion. Celotex appealed, challenging the court's failure to charge on apportionment of damages and to direct a verdict on the issue of wage loss.5
6
We have jurisdiction under 28 U.S.C. § 1291 (1988).6 We will affirm the district court's denial of j.n.o.v. unless the record is " 'critically deficient of that minimum quantum of evidence from which the jury might reasonably afford relief.' " Honeywell, Inc. v. American Standards Testing Bureau, Inc., 851 F.2d 652, 654 (3d Cir.1988) (citations omitted), cert. denied, 488 U.S. 1010, 109 S.Ct. 795, 102 L.Ed.2d 787 (1989). We will review the denial of a motion for new trial only for abuse of discretion unless, as in this case, the motion was based on the application of a legal precept, in which case our review is plenary. Id. As a federal court sitting in diversity, we look to state law. Our review of the district court's interpretation of state law is plenary, Compagnie des Bauxites de Guinee v. Insurance Co. of North America, 724 F.2d 369, 371 (3d Cir.1983).
II.
7
Celotex's primary argument concerns apportionment of damages. According to Celotex, the evidence was sufficient to require the trial court to charge the jury on apportionment of damages between asbestos exposure and tobacco consumption. Our first step, therefore, is to review the expert testimony presented at trial.
8
Mrs. Borman called Dr. Daniel DuPont, a specialist in pulmonary medicine. On direct examination, Dr. DuPont testified that Mr. Borman's "exposure to asbestos dust was a substantial contributing factor to" both his asbestosis and his lung cancer. On cross-examination, Dr. DuPont testified that "Mr. Borman's cigarette smoking history [was] a substantial contributing factor to the development of his lung cancer."
9
Much of the cross-examination of Dr. DuPont, however, focused on the increased risk of lung cancer caused by tobacco smoking and asbestos inhalation:
10
Q And what is [the risk of developing lung cancer for persons with a significant smoking history] as compared with the non-smokers and ... the non-asbestos exposed folks in the general population?
11
A Up to 12--up to 12 to 15 times the group you compared, which is known as the background group.
12
Q The background group is--that's the so-called clean livers, the people who aren't exposed to asbestos and who didn't smoke; right?
13
A Correct.
14
* * * * * *
15
Q Doctor, can you tell the jury what the risk of an occupationally exposed worker who was not a cigarette smoker, what his risk is of getting lung cancer as compared to the background population of non-smokers, non-asbestos exposed people?
16
A Yes.
17
Q What is it?
18
A Up to five to six times the background incidence.
19
Q So would you agree with me, therefore, Doctor, that taken alone, cigarette smoking is two or three times more likely to cause a lung cancer than asbestos is, taken alone?
20
A In the interpreted statistically, and that is, in looking at a large number of people or a body of people, which the rule of epidemiology, that that's what the statistics would indicate, yes.
21
Not in the particular case, however. As I previously testified, under any one individual, which is different than the information that you have reviewed, in one individual that any one can give us an assignment of causation.
22
Q Well, Doctor, along those lines, since you've testified that--on the one hand you've given us these numbers, on the one hand you said that you agree with me that smoking alone is two or three times as likely to cause lung cancer as asbestos alone--why should this jury not assume that in this case, cigarette smoking was two or three times as responsible, under your analysis, for the lung cancer as asbestos was?
23
A Among other reasons, you haven't gotten into the statistics as to the risk of lung cancer in the population that Mr. Borman would fit. And that would be the population of people who have combined asbestos exposure and tobacco consumption. And those factors are very impressive.
24
Those factors, just to complete the statement, refer to synergistic effect. And that is, if you take the 12 to 15 up to--I want to make that clear for the record--up to 12 to 15 fold increase of cigarette smoking alone. And the up to five to six fold increase of asbestos exposure alone and you put the two together and you take the statistics in that area, which is really the only group that applies to Mr. Borman, that risk factor is multiplied and therefore, the risk factor is up to 60 to 90 times the background incidence.
25
Despite the extensive evidence on likelihood of causation, Dr. DuPont emphasized that he could not apportion the damages:
26
Q ....
27
Now Doctor, can you tell us which of these two factors was more responsible for the development of his lung cancer?
28
A Not in Mr. Borman's case, I can't.
29
Q You can't do that at all?
30
A Well, you're taking data applying to 100,000 people and asking me to refine that to one individual. As I previously testified ... I don't know that you can, in one individual, give an assignment as to what the risk factor was or proportion which of the two significant risk factors was more or what percentage there was.
BY MR. MCDAVID:
31
Q All you can say is that asbestos and cigarette smoking were each greater than zero percent and less than 100 percent responsible; is that right?
32
A Each factor--this patient[']s lung cancer, which was the cause of his death, was caused to a substantial degree by asbestos exposure and tobacco consumption.
33
Q Well, would you agree with me that each factor must have been more than zero and less than 100 percent?
34
A Yeah, I guess I would agree with that.
35
Q Can you tell us anything other than that about the percentage?
36
A I don't believe that, speaking on one individual, and narrowing those statistics down to one person, that I could.
37
The defense put on its own expert, Dr. William Weiss, also a specialist in pulmonary medicine.7 Dr. Weiss testified that asbestos exposure "did not cause [Mr. Borman's] lung cancer." On the contrary, he said only smoking "caused the lung cancer in Mr. Borman's case." Dr. Weiss was not asked to apportion damages.
A.
38
The parties agree that Pennsylvania law applies on the apportionment of damages. Before looking at specific Pennsylvania law, however, some background is appropriate. Certain types of harm "are normally incapable of any logical, reasonable, or practical division." Restatement (Second) of Torts § 433A comment i (1965). Such harms include death, a broken limb and any single wound. Id. "By far the greater number of personal injuries ... are ... normally single and indivisible." Id. In this case, although Mr. Borman suffered numerous diseases, his disability is the sole harm for which recovery is sought. Martin v. Johns-Manville Corp., 349 Pa.Super. 46, 56, 502 A.2d 1264, 1269 (1985) (Martin I ) ("While it is apparent from the testimony at trial that appellant suffered separate harms--chronic bronchitis, emphysema and asbestosis--the 'harm' for which he sued and as to which the jury found him entitled to recover was his disability"), rev'd on other grounds sub nom. Martin v. Owens-Corning Fiberglas Corp., 515 Pa. 377, 528 A.2d 947 (1987) (Martin II ).
39
While a single harm may resist apportionment, apportionment can nonetheless be invoked when the particular contribution of multiple causes can be determined on a factual basis. Restatement (Second) of Torts § 433A. The procedure remains equally viable when the plaintiff's conduct, even if innocent, was a substantial cause of his harm. Id. comment a. In both cases, apportionment promotes fairness by "limit[ing] a defendant's liability to that part of the harm of which that defendant's conduct has been a cause in fact." See Prosser and Keeton on Torts § 52, at 345 (5th ed. 1984). Apportionment can be harsh to the plaintiff, however, because it shifts to him "the risk of financial irresponsibility of each wrongdoer." Id. at 351.
B.
40
A federal court exercising diversity jurisdiction must apply state law as declared by the highest state court. See Erie R.R. v. Tompkins, 304 U.S. 64, 71-80, 58 S.Ct. 817, 818-23, 82 L.Ed. 1188 (1938); Gruber v. Owens-Illinois Inc., 899 F.2d 1366, 1369 (3d Cir.1990). When the state's highest court has not addressed the issue, the federal court must predict its holding. See Commissioner of Internal Revenue v. Estate of Bosch, 387 U.S. 456, 465, 87 S.Ct. 1776, 1782, 18 L.Ed.2d 886 (1967); Gruber, 899 F.2d at 1369-70. As we shall see, resolution of this matter is somewhat complicated because the Pennsylvania Supreme Court has addressed the issue but only in its plurality opinion in Martin II.
41
"The rules in [Pennsylvania] governing apportionment of damages are consistent with those expressed in the Restatement (Second) of Torts." Martin II, 515 Pa. at 381, 528 A.2d at 949. At the close of evidence, "[t]he trial court must determine, as a matter of law, whether the harm is capable of apportionment." Id. at 382, 528 A.2d at 949 (citing inter alia Restatement (Second) of Torts § 434(1)(b)). The following provision controls this determination:
42
(1) Damages for harm are to be apportioned among two or more causes where
43
(a) there are distinct harms, or
44
(b) there is a reasonable basis for determining the contribution of each cause to a single harm.
45
(2) Damages for any other harm cannot be apportioned among two or more causes.
46
Restatement (Second) of Torts § 433A (1965), quoted in Martin II, 515 Pa. at 381, 528 A.2d at 949. "[T]he burden of proving apportionment rests on the party seeking it." Martin II, 515 Pa. at 382, 528 A.2d at 949 (citing Restatement (Second) of Torts § 433B(2)). "Once it is determined that the harm is capable of being apportioned, the actual apportionment of the damages among the various causes is a question of fact, which is to be determined by the jury...." Restatement (Second) of Torts § 434 comment d.
47
This case implicates § 433A(1)(b)--whether "there is a reasonable basis for determining the contribution of each cause to a single harm." Because we apply Pennsylvania law, resolution of this issue hinges on one case, Martin II. Martin, an insulator for thirty-nine years and a cigarette smoker for approximately thirty-seven years (two packs a day over the last eighteen years), sought damages for pulmonary disability that he claimed was caused by working with asbestos-containing products manufactured by the defendants. With respect to apportionment, the following evidence was adduced:
48
1. Plaintiff's experts "testified that his disability was due to both asbestosis, caused by asbestos exposure, and emphysema, caused by [his] long-term cigarette smoking and aggravated by asbestos exposure and the resulting asbestosis." Martin II, 515 Pa. at 380, 528 A.2d at 948.
49
2. Plaintiff's experts could not assign a percentage of contribution to either cause. Id. at 383-84, 528 A.2d at 950.
50
3. Defendants' experts testified that "[plaintiff's] disability was solely the result of emphysema, caused by cigarette smoking." Id. at 380, 528 A.2d at 948.
51
In addition, the evidence demonstrated bullous changes associated with cigarette smoking in the upper portions of the lungs and pleural plaques consistent with asbestos inhalation, in the middle and lower zones of the lungs. Id. at 388-91, 528 A.2d at 952-53. On this evidence, the trial judge instructed the jury that it could apportion damages for plaintiff's disability between asbestos inhalation and cigarette smoking. See id. at 380, 528 A.2d at 948.
52
On appeal, the Pennsylvania Superior Court affirmed, holding the evidence "sufficient to enable the jury to reach a reasonable approximation of the harm due to each cause." Martin I, 349 Pa.Super. at 51, 502 A.2d at 1267. Writing for the court, Judge Spaeth reasoned that the injuries to the upper and lower lobes and the different periods of asbestos and tobacco inhalation showed that "the causes of the harm were ... distinct and capable of rough approximation." Id. at 59, 502 A.2d at 1271. He relied particularly on the principle that "damages may be apportioned if the plaintiff's conduct, even though innocent, has contributed to the harm. Thus, the question whether appellant was negligent in smoking cigarettes is irrelevant to deciding whether his damages may be reduced because of the part that smoking played in his disability." Id. at 56-57, 502 A.2d at 1270 (paraphrasing Restatement (Second) of Torts § 433A comment a).
53
In a plurality opinion,8 the Pennsylvania Supreme Court reversed and remanded for a new trial, holding the evidence on apportionment of damages too speculative to support submission of the issue to the jury. Martin II, 515 Pa. at 384-85, 528 A.2d at 950. As Justice Larsen explained,
54
[T]he jury cannot be expected to draw conclusions which medical experts, relying on the same evidence, could not draw. The causes of disability in this case do not lend themselves to separation by lay-persons on any reasonable basis. Thus, common sense and common experience possessed by a jury do not serve as substitutes for expert guidance, and it follows that any apportionment by the jury in this case was a result of speculation and conjecture and hence, improper. "Rough approximation" is no substitute for justice.
55
Id., 528 A.2d at 950 (footnotes omitted).
56
In his concurring opinion, however, Justice McDermott made clear that Martin II would not preclude apportionment in the appropriate asbestos case:
57
The Majority Opinion stands for a single proposition, i.e., under the facts and circumstances of this case there was not enough evidence to submit the issue of apportionment to the jury. With this I can agree.
58
However, this case should not be construed as standing for the proposition that evidence of contributory negligence is inadmissible in an asbestosis case. Furthermore, it should not be interpreted as precluding the defendants in this case from introducing new evidence of decedent's negligence, nor precluding a jury from returning a lesser verdict if the evidence would support such.
59
Id. at 386, 528 A.2d at 951.
60
Because Justice Larsen's opinion does not represent a majority view, it is not considered controlling precedent under Pennsylvania law. Decatur Contracting v. Belin, Belin & Naddeo, 898 F.2d 339, 344 (3d Cir.1990) (quoting Vargus v. Pitman Mfg. Co., 675 F.2d 73, 75 (3d Cir.1982)); McGowan v. University of Scranton, 759 F.2d 287, 293 (3d Cir.1985). Therefore, "without an authoritative announcement, we still must predict how the Pennsylvania Supreme Court would rule on this issue." Decatur Contracting, 898 F.2d at 344 (citation omitted).9
C.
61
To determine whether the Pennsylvania Supreme Court would find the evidence in this case too speculative to support submission of the apportionment issue to the jury, we must compare the evidence presented in this case with that adduced in Martin. The evidence is remarkably alike. First, the decedents have similar histories of asbestos and tobacco consumption. Martin was an asbestos worker for thirty-nine years; he smoked cigarettes for about thirty-seven years, two packs a day during the last eighteen years. Mr. Borman worked with asbestos insulation for thirteen years; he smoked cigarettes for thirty-five years, over a pack a day. Second, the experts espouse the same diagnostic framework. Pulmonary disease may be restrictive (the lung cannot fully expand) or obstructive (the airway passages are blocked). Asbestosis is a restrictive disease, although the plaintiffs' experts testified that it also has an obstructive component. Emphysema and chronic bronchitis are obstructive diseases. Furthermore, asbestosis is caused by asbestos exposure, and emphysema and bronchitis are caused by cigarette smoking.10 Third, the decedents exhibited similar symptoms. Both developed pleural plaques, which are caused by asbestos inhalation but not by cigarette smoking. In addition, both had chronic obstructive pulmonary disease, revealed in Martin as bullous changes on x-rays and in Mr. Borman as diminished exhalation speed in spirograms. Fourth, the experts drew the same conclusions regarding decedents' disabilities. While the plaintiffs' experts concluded that the decedents had asbestosis, all experts agreed that the plaintiffs also had emphysema and bronchitis.11 Thus, the plaintiffs' experts concluded that asbestos exposure and tobacco inhalation were both substantial causes of the harm while the defendants' experts asserted that cigarette smoking was the sole cause of the harm. The plaintiffs' experts also testified that, in the individual case, they could not apportion cause between the two factors; the defendants' experts, however, did not testify on the issue.
62
Celotex argues with considerable plausibility that despite the inability of the experts to assign a percentage of contribution to each cause, the evidence provided the jury with a reasonable basis for apportioning damages between the two causes in this case. The jury heard testimony from the plaintiff's expert regarding the risk of developing lung cancer from cigarette smoking, asbestos exposure or both, and the extent to which the distinctive effects of both asbestos exposure and cigarette smoking were evident in the lungs of Mr. Borman. The jury was aware of the length of time during which Mr. Borman had worked with asbestos and smoked cigarettes. Therefore, Celotex contends that despite the fact that the experts could not calculate the exact proportion that each factor contributed to Mr. Borman's disability, the causes of the harm were distinct and capable of rough approximation. Thus, Celotex argues that where a factual basis exists, it is preferable in the interest of fairness to permit some rough apportionment of damages, rather than to hold the defendant entirely liable for a harm that was inflicted by separate causes. See Prosser and Keeton, supra, at 345.12
63
However, we reiterate that we are not free to treat this issue as if it were a matter of first impression in our court. We recognize that Martin II is not controlling. Because the facts of this case mirror those of Martin II, however, we find the limited holding expressed by Justice McDermott--"under the facts and circumstances of this case there was not enough evidence to submit the issue of apportionment to the jury"--critical in predicting how the Pennsylvania Supreme Court would decide this issue. On the facts, we cannot justifiably distinguish this case from Martin. Therefore, based on Martin II, we predict that the Pennsylvania Supreme Court would hold this evidence insufficient to support a charge on apportionment of damages.13
64
Nor does the statistical evidence presented by Borman's expert in this case concerning the increased risk of lung cancer associated with cigarette smoking, asbestos inhalation or both, change our conclusion. Although the opinions do not reveal whether such evidence was presented in Martin, Celotex contends that it was not. The question is whether this additional statistical evidence distinguishes this case from Martin and gives the jury a reasonable basis for apportionment.
65
Although the Restatement (Second) requires only a "reasonable basis for determining the contribution of each cause to a single harm" and Justice McDermott's concurrence contemplates evidence sufficient to support apportionment of damages, we do not believe the Pennsylvania Supreme Court would hold the increased risk evidence sufficient to create a reasonable basis for apportionment. This evidence speaks to the likelihood that either cigarette smoking, asbestos exposure or both will cause cancer, rather than to the apportionment of damages between two causes. Thus, based on this evidence, the plaintiff's expert concluded that cigarette smoking and asbestos exposure were each substantial factors in causing Mr. Borman's lung cancer. However, the expert was unwilling to rely on this evidence in the individual case as a basis for apportioning cause. Moreover, even assuming that this detailed statistical evidence was not presented in Martin, the jury was informed that " 'many people think [cigarette smoking] enhances the genesis of asbestosis. That is it enhances the fibrosis of asbestosis and certainly enhances the associated complication of asbestosis.' " Martin I, 349 Pa.Super. at 54, 55, 502 A.2d at 1269. Nonetheless, the Pennsylvania Supreme Court held that there was insufficient evidence to support an apportionment. We find nothing in the plurality or concurring opinions to indicate that the Pennsylvania Supreme Court would reach a different result on the apportionment issue if faced with this additional evidence.
66
In our research, we examined four cases that have cited Martin II and found no conflict with Martin II's conclusions. Of these four cases, the most analogous is Taylor v. Celotex Corp., 393 Pa.Super. 566, 574 A.2d 1084 (1990). In that case, as here, the plaintiff was a heavy smoker who had been exposed to asbestos. He was diagnosed as suffering from asbestosis, hypertension, arteriosclerotic heart disease, and emphysema. Defense experts testified that Taylor did not have asbestosis, and neither plaintiffs' experts nor defendants' experts attempted to apportion the cause of Taylor's illness among cigarette smoking, asbestos exposure, and heart disease. Id. at 592-93, 574 A.2d at 1097-98. The Superior Court, following Martin II, affirmed the trial court's refusal to instruct the jury on apportionment. Id. at 593, 574 A.2d at 1098.14
III.
67
We now turn to Celotex's second argument, concerning damages for lost wages. According to Celotex, the only evidence adduced on the cost of Mr. Borman's personal maintenance is the following testimony of his wife:
68
Q Before he retired, did--and while he was working full-time and including the overtime, did he take any money for personal maintenance purposes on a weekly basis?
69
A Yeah.
70
Q Can you give the ladies and gentlemen of the jury an approximate amount of what heA He--approximately 20, $25 a week for whatever he wanted.
71
Mrs. Borman does not cite additional evidence.
72
Asserting that this evidence--by which the wage loss claim would be reduced--invited speculation as to the cost of Mr. Borman's personal maintenance, the non-settling defendants moved "that the wage loss claim be precluded."15 The district judge denied this motion. After trial, Celotex moved unsuccessfully for a directed verdict on the issue. Celotex now challenges the post-trial order.
73
Under Pennsylvania law, "[l]oss of future earnings is a distinct item of damages, which if properly proved, may result in recovery for the plaintiff." Kaczkowski v. Bolubasz, 491 Pa. 561, 566, 421 A.2d 1027, 1029-30 (1980) (footnote omitted). If an injured plaintiff dies, "the proper measure of damages includes a deduction based upon decedent's cost of personal maintenance." Id. at 566 n. 7, 421 A.2d at 1030 n. 7. The cost of personal maintenance does not encompass "only those expenditures essential to the barest survival." McClinton v. White, 497 Pa. 610, 617, 444 A.2d 85, 89 (1982). Rather, it includes the " 'sum which a decedent would be expected to spend, based on his station in life, for food, clothing, shelter, medical attention and some recreation.' " Id., 444 A.2d at 89 (citation omitted).
74
Celotex does not argue that the amount of maintenance costs should be increased, but only that inadequacy of the proof of maintenance defeats the entire future earnings claim. However, it cites no case in which a Pennsylvania court refused to allow the jury to consider a lost earnings claim for this reason. In any event, the evidence presented by plaintiff in this case is more concrete than that presented in McClinton. Although the evidence on the cost of personal maintenance is spare, it is sufficient. Because damages need not be proven with mathematical exactness, we will affirm.
IV.
75
For the foregoing reasons, we will affirm the order of the district court.
76
Each side to bear its own costs.
*
The Honorable Dolores K. Sloviter became Chief Judge of the Third Judicial Circuit on February 1, 1991
1
According to the complaint, "plaintiff was caused to contract diseases and injuries to his body system, lungs, respiratory system, heart and damages to various organs of his body including injury to tissue and bone, the full extent of which has not been determined, and including, but not limited to, asbestosis, scarred lungs, respiratory disorders, and the risk of mesothelioma and other cancers, some or all of which may be permanent and/or fatal."
2
Although the complaint also avers negligence and breach of warranty, the case proceeded on the theory of strict liability only
3
"Well, I'm not going to charge on apportionment. As I understand it, the plaintiff's position is that the causation issue is non-apportionable and in both the defendants' openings, the jury was advised that your positions were that the lung cancer was not caused at all by exposure to asbestos
"So I don't really see any basis for apportionment. The plaintiff's evidence, its expert--the plaintiff's expert--said that the causation wasn't apportionable and I don't think it's proper or fair to submit that issue to the jury under all the circumstances."
4
After a day of jury deliberations, the foreman sent out a question:
One of the members of the jury is wrestling with the ... concept "substantial factor" in evaluating the impact asbestos exposure may have had in contributing to Mr. Borman's lung cancer. According to the testimony of Dr. DuPont, smoking increases the likelihood of contracting lung cancer 12 to 15 fold. Exposure to asbestos ... increases the likelihood of contracting lung cancer 6 to 9 fold.
Can asbestosis be considered to be a "substantial factor" in Mr. Borman's lung cancer if, in fact, in percentage terms, it was responsible but not primarily responsible. (i.e. smoking was the major contributor (60-70%) but asbestosis was a contributor as well (30-40%) and increased the likelihood of Mr. Borman contracting lung cancer.)
The court recharged the jury on substantial factor. Celotex implies that it requested the court to instruct the jury on apportionment at this point but does not cite the record for support. According to Mrs. Borman, however, the record does not reveal such a request, nor has our research uncovered one.
5
The notice of appeal also challenges an order granting Mrs. Borman's motion for delay damages. Neither party, however, has briefed this issue. Therefore, this objection has been waived
6
The district court had jurisdiction under 28 U.S.C. § 1332 (1988)
7
The defense also presented the videotaped deposition of a radiologist, Dr. Joseph Becker, but neither party has relied on his testimony
8
Two other justices joined this opinion, Justice McDermott concurred and three justices dissented
9
Celotex also directs our attention to an unpublished opinion of this Court, Parker v. Bell Asbestos Mines, Ltd., No. 86-1197, slip op. at 2-7 (3d Cir. Dec. 30, 1987) (per curiam) [838 F.2d 462 (table) ]. However, "[b]ecause only published opinions have precedential value, the court does not cite to its unpublished opinions as authority." Third Circuit Internal Operating Procedure 5.6 (July 1990)
10
The experts here went one step further, testifying that asbestos inhalation and tobacco consumption can also cause lung cancer
11
The experts here also concluded that Mr. Borman had lung cancer
12
We note with interest the analysis in the dissent by then Justice Hutchinson, now of our court:
I am at a loss to imagine what additional testimony would satisfy the majority. Requiring the experts to speak in terms of numerical percentages introduces a false precision into the evidence. Mathematical exactitude is not found in the real world of medicine. We should not mislead lay jurors by requiring experts to falsely imply its existence. Honest, but more flexible, words such as "substantial factor," "major contribution" or "significant cause" are more suitable to the proper jury function of justly and fairly resolving uncertainties.
Martin II, 515 Pa. at 392, 528 A.2d at 954.
13
It should also be noted that Martin II prohibited apportionment despite evidence of disease specific to tobacco in the upper lobes and asbestos in the lower lobes. Such evidence, which tends to support apportionment, is not present here
14
Nor do the other three cases citing Martin II conflict with Martin II's conclusions. In Guidry v. Johns-Manville Corp., 377 Pa.Super. 308, 547 A.2d 382 (1988), the plaintiff died six months after he was diagnosed with lung cancer. Medical expert testimony was conflicting over whether decedent's lung cancer resulted from asbestos exposure or smoking or both. Id. at 315, 547 A.2d at 386. Relying on Martin II, the Superior Court refused to allow a new trial on the ground that damages were too low. Id. at 316, 547 A.2d at 386. The other two cases involved awards for personal injuries in which the court decided that apportionment was not justified. See Corbett v. Weisband, 380 Pa.Super. 292, 327, 551 A.2d 1059, 1077 (1988) (concluding from evidence presented in a medical malpractice claim for negligent care and treatment that any attempt to apportion damages would be speculative); Glomb v. Glomb, 366 Pa.Super. 206, 214-15, 530 A.2d 1362, 1367 (1987) (stating from evidence involving the negligent hiring and retaining of a babysitter who intentionally abused a child, that there was no "logical, reasonable, or practical" basis for a jury to even roughly apportion the percentage of injuries attributable to the defendants)
In support of its position, Celotex cites to four unpublished cases of the Philadelphia Court of Common Pleas. However, three of these cases supplied by Celotex were decided before Martin II and one case had no date or docket number. Celotex does not cite to any lower court opinion in Pennsylvania decided after Martin II.
15
It should be noted that Celotex does not challenge the evidence of Mr. Borman's lost wages | 01-03-2023 | 08-23-2011 |
https://www.courtlistener.com/api/rest/v3/opinions/96261/ | 197 U.S. 430 (1905)
LOUISVILLE AND NASHVILLE RAILROAD COMPANY
v.
BARBER ASPHALT PAVING COMPANY.
No. 170.
Supreme Court of United States.
Argued March 7, 8, 1905.
Decided April 3, 1905.
ERROR TO THE COURT OF APPEALS OF THE STATE OF KENTUCKY.
Mr. Helm Bruce, with whom Mr. James P. Helm and Mr. T.K. Helm were on the brief, for plaintiff in error.
Mr. William Furlong and Mr. A.E. Richards, with whom Mr. Benjamin F. Washer was on the brief, for defendants in error.
*432 MR. JUSTICE HOLMES delivered the opinion of the court.
This is a proceeding under the Kentucky Statutes, § 2834, to enforce a lien upon a lot adjoining a part of Frankfort avenue, in Louisville, for grading, curbing and paving with asphalt the carriage way of that part of the avenue. The defendant, the plaintiff in error, pleaded that its only interest in the lot was a right of way for its main roadbed, and that neither the right of way nor the lot would or could get any benefit from the improvement, but on the contrary rather would be hurt by the increase of travel close to the defendant's tracks. On this ground it set up that any special assessment would deny to it the equal protection of the laws, contrary to the Fourteenth Amendment of the Constitution of the United States. It did not object to the absence of the parties having any reversionary interest, but defended against any special assessment on the lot. The answer was demurred to, judgment was rendered for the plaintiff, and this judgment was affirmed by the Kentucky Court of Appeals. 76 S.W. Rep. 1097. A writ of error was taken out, and the case was brought to this court. It will be noticed that the case concerns only grading, curbing and paving, and what we shall have to say is confined to a case of that sort.
The State of Kentucky created this lien by a statute entitled "An act for the government of cities of the first class." Louisville is the only city of the first class at present in Kentucky, and the general principles of the act are taken verbatim from the part of the charter of Louisville which was considered and upheld by this court in Walston v. Nevin, 128 U.S. 578. But we take the statute as a general prospective law and not as a legislative adjudication concerning a particular place and a particular plan such as may have existed in Spencer v. Merchant, 125 U.S. 345, and as was thought to exist in Smith *433 v. Worcester, 182 Massachusetts, 232, referred to at the argument.
The law provides in the case of original construction, such as this improvement was, that it shall be made at the exclusive cost of the adjoining owners, to be equally apportioned according to the number of feet owned by them. In the case of a square or subdivision of land bounded by principal streets, which the land including the defendant's lot was held to be, see Cooper v. Nevin, 90 Kentucky, 85; Nevin v. Roach, 86 Kentucky, 492, 499, the land is assessed half way back from the improvement to the next street. Acts of 1898, c. 48. Ky. Stat. § 2833. A lien is imposed upon the land and "the general council, or the courts in which suits may be pending, shall make all corrections, rules, and orders to do justice to all parties concerned." Section 2834. The principle of this mode of taxation seems to have been familiar in Kentucky for the better part of a hundred years. Lexington v. McQuillan, 9 Dana, 513.
The argument for the plaintiff in error oscillates somewhat between the objections to the statute and the more specific grounds for contending that it cannot be applied constitutionally to the present case. So far as the former are concerned they are disposed of by the decisions of this court. There is a look of logic when it is said that special assessments are founded on special benefits and that a law which makes it possible to assess beyond the amount of the special benefit attempts to rise above its source. But that mode of argument assumes an exactness in the premises which does not exist. The foundation of this familiar form of taxation is a question of theory. The amount of benefit which an improvement will confer upon particular land, indeed whether it is a benefit at all, is a matter of forecast and estimate. In its general aspects at least it is peculiarly a thing to be decided by those who make the law. The result of the supposed constitutional principle is simply to shift the burden to a somewhat large taxing district, the municipality, and to disguise rather than to answer the theoretic *434 doubt. It is dangerous to tie down legislatures too closely by judicial constructions not necessarily arising from the words of the Constitution. Particularly, as was intimated in Spencer v. Merchant, 125 U.S. 345, it is important for this court to avoid extracting from the very general language of the Fourteenth Amendment a system of delusive exactness in order to destroy methods of taxation which were well known when that Amendment was adopted and which it is safe to say that no one then supposed would be disturbed. It now is established beyond permissible controversy that laws like the one before us are not contrary to the Constitution of the United States. Walston v. Nevin, 128 U.S. 578; French v. Barber Asphalt Paving Co., 181 U.S. 324; Webster v. Fargo, 181 U.S. 394; Cass Farm Co. v. Detroit, 181 U.S. 396; Detroit v. Parker, 181 U.S. 399; Chadwick v. Kelley, 187 U.S. 540, 543, 544; Schaefer v. Werling, 188 U.S. 516; Seattle v. Kelleher, 195 U.S. 351, 358.
A statute like the present manifestly might lead to the assessment of a particular lot for a sum larger than the value of the benefits to that lot. The whole cost of the improvement is distributed in proportion to area, and a particular area might receive no benefits at all, at least if its present and probable use be taken into account. If that possibility does not invalidate the act it would be surprising if the corresponding fact should invalidate an assessment. Upholding the act as embodying a principle generally fair and doing as nearly equal justice as can be expected seems to import that if a particular case of hardship arises under it in its natural and ordinary application, that hardship must be borne as one of the imperfections of human things. And this has been the implication the cases. Davidson v. New Orleans, 96 U.S. 97, 106; Mattingly v. District of Columbia, 97 U.S. 687, 692; Parsons v. District of Columbia, 170 U.S. 45, 52, 55; Detroit v. Parker, 181 U.S. 399, 400; Chadwick v. Kelley, 187 U.S. 540, 544.
But in this case it is not necessary to stop with these general considerations. The plea plainly means that the improvement *435 will not benefit the lot because the lot is occupied for railroad purposes and will continue so to be occupied. Compare Chicago, Burlington & Quincy R.R. v. Chicago, 166 U.S. 226, 257, 258. That, apart from the specific use to which this land is devoted, land in a good-sized city generally will get a benefit from having the streets about it paved, and that this benefit generally will be more than the cost, are propositions which, as we already have implied, a legislature is warranted in adopting. But, if so, we are of opinion that the legislature is warranted in going one step further and saying that on the question of benefit or no benefit the land shall be considered simply in its general relations and apart from its particular use. See Illinois Central R.R. v. Decatur, 147 U.S. 190. On the question of benefits the present use is simply a prognostic, and the plea a prophecy. If an occupant could not escape by professing his desire for solitude and silence, the legislature may make a similar desire fortified by structures equally ineffective. It may say that it is enough that the land could be turned to purposes for which the paving would increase its value. Indeed, it is apparent that the prophecy in the answer cannot be regarded as absolute, even while the present use of the land continues for no one can say that changes might not make a station desirable at this point; in which case the advantages of a paved street could not be denied. We are not called on to say that we think the assessment fair. But we are compelled to declare that it does not go beyond the bounds set by the Fourteenth Amendment of the Constitution of the United States.
Judgment affirmed.
MR. JUSTICE HARLAN, not having been present at the argument, took no part in the decision.
MR. JUSTICES WHITE and PECKHAM dissent. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/1614463/ | 939 So.2d 743 (2005)
Randy Cal LINDSEY
v.
STATE of Mississippi.
No. 2003-KA-00331-SCT.
Supreme Court of Mississippi.
March 17, 2005.
Rehearing Denied February 9, 2006.
*744 Edmund J. Phillips, Jr., Appellant, pro se.
Office of the Attorney General by Scott Stuart, Attorney for Appellee.
Before WALLER, P.J., GRAVES AND DICKINSON, JJ.
WALLER, Presiding Justice, for the Court:
¶ 1. Randy Cal Lindsey appeals from his conviction in Scott County Circuit Court of burglary of a business and his sentence as a habitual offender to seven years without parole in the custody of the Mississippi Department of Corrections. Lindsey's appellate attorney filed a brief arguing that Lindsey's appeal is without merit and cited to our decision in Turner v. State, 818 So.2d 1186, 1189 (Miss.2001) (providing procedure to be followed by attorneys who believe indigent client's appeal has no merit), overruling Killingsworth v. State, 490 So.2d 849 (Miss.1986).[1] Lindsey now comes before the Court pro se.
FACTS
¶ 2. After being dispatched to Cox's Chevron in response to a burglary alarm, Officers Will Jones and Russell Ellis of the Forest Police Department discovered that someone had broken the glass in the front door with a brick and stolen seven cartons of Marlboro cigarettes. Upon arriving at the scene around 5 a.m., Ellis questioned Fonzy Odom, who was standing in the area. Odom told Ellis he had seen two black males at the scene and indicated the men went down West Fourth Street.[2] After going down the street, Ellis noticed Randy Lindsey under a car port and tried to question him. When Lindsey behaved defensively, Ellis took him into custody. Upon returning to the car port to investigate, Ellis discovered seven cartons of Marlboro cigarettes inside a stack of tires close to where Lindsey had been standing when Ellis spotted him.
¶ 3. The surveillance tape revealed that the person who stole the cigarettes wore the same outfit that Lindsey was wearing that morning. Furthermore, after the police took Odom into custody, he altered his previous statement and told the police that after the two black males ran off, Lindsey came up with the cigarettes in hand and said, "Fonzy, I got what you need."
¶ 4. At trial, Lindsey admitted taking the cigarettes, but denied breaking into Cox's Chevron. He explained,
I went behind the Chevron and used the bathroom. As I was getting ready to come around the corner the alarm went off, so I panicked at first, and I said, `Well, hey, I ain't did nothing [sic].' . . . So, when I go around front I see the front glass broken, and I said, `Well, s* * *, this is opportunity[.]' So I squatted down and went on into the store . . . and got some cigarettes and ran behind the store to a friend's house[.]
¶ 5. The following exchange took place between the prosecutor and Lindsey regarding Lindsey's partial admission.
*745 MR. TURNER: [I]f I understand your story correctly, you're saying somebody else just came by and did the breaking for you, but they just they didn't go in. So, you fortuitously came by and saw the door had already been broken and said, `Well, if I can sell that to a jury if I get caught, the worst thing they'll get me for is maybe just a little petty larceny or something.' Is that kind of what your thinking process was?
MR. LINDSEY: No sir, that's not my thinking process. When I came around the building you could see someone else leaving. I didn't know if it was the two men or what, but you could kind of tell from the corner there was somebody running . . . away. So, that was my chance to get me some cigarettes[.]
¶ 6. The State presented no evidence revealing who broke the glass door with the brick. After the State rested, Lindsey's trial counsel moved for a directed verdict, arguing the State failed to prove all the elements of burglary beyond a reasonable doubt. The trial court overruled the objection, and after presentation of the defense, the jury unanimously found Lindsey guilty of burglary. Lindsey's attorney filed a brief purportedly complying with the Turner decision and notified Lindsey of his right to file a brief pro se.
ANALYSIS
¶ 7. In his pro se brief, Lindsey raises several grounds of reversible error: (1) he has unconstitutionally been denied assistance of counsel at the appellate stage; (2) the State failed to prove beyond a reasonable doubt Lindsey committed the crime of burglary; (3) the trial court committed various errors in denying a continuance as well as denying him a trial transcript; (4) he received ineffective assistance of counsel at trial; and (5) the Mississippi Supreme Court "error [sic] by not entertaining petitioner [sic] unexhaustion [sic] claim." Finding additional briefing warranted in accord with Lindsey's complaints regarding issue one, we direct further briefing consistent with this opinion.
¶ 8. Lindsey cites the Fourteenth Amendment as well as applicable Supreme Court precedent and essentially complains pro se that he has been denied his constitutional right to counsel as a result of his attorney's failure to properly represent him before this Court. The State acknowledges the legitimacy of Lindsey's argument, and in its response, highlights the unconstitutionality of our procedure for addressing potentially frivolous claims of indigent defendants.[3] We therefore find Lindsey has adequately raised the issue and address this argument on its merits.
¶ 9. In Smith v. Robbins, 528 U.S. 259, 273-74, 120 S.Ct. 746, 145 L.Ed.2d 756 (2000), the United States Supreme Court, speaking through Justice Thomas, stated that although the Court had previously laid down a "prophylactic framework" to vindicate the Fourteenth Amendment right to appellate counsel, it "expressly disclaimed any pretensions to rulemaking authority for the States in the area of indigent criminal appeals." Instead, the Court stated, "States may and, we are confident, will craft procedures that, in terms of policy, are superior to, or at least as good as" the framework the Court introduced in Anders v. California, 386 U.S. *746 738, 87 S.Ct. 1396, 18 L.Ed.2d 493 (1967), and Douglas v. California, 372 U.S. 353, 83 S.Ct. 814, 9 L.Ed.2d 811 (1963).
¶ 10. Before reviewing California's procedure, the Court stated,
[I]t is important to focus on the underlying goals that the procedure should serve to ensure that those indigents whose appeals are not frivolous receive the counsel and merits brief required by Douglas, and also to enable the State to `protect itself so that frivolous appeals are not subsidized and public moneys are not needlessly spent.' . . . For although, under Douglas, indigents generally have a right to counsel on a first appeal as of right, it is equally true that this right does not include the right to bring a frivolous appeal and, concomitantly, does not include the right to counsel for bringing a frivolous appeal.
Robbins, 528 U.S. at 277-78, 120 S.Ct. 746 (citations omitted).
¶ 11. In its survey of the procedures which it has found unconstitutionally inadequate in past cases, the Court noted four instances in which it had found State procedures to be inappropriate: (1) when the procedure requires that a defendant be "unlikely to prevail on appeal," rather than requiring the appellate court or counsel to find the appeal is frivolous; (2) when a procedure permits appellate counsel to withdraw his or her representation of the indigent defendant and the appellate court decide the appeal without appointing new counsel;[4] (3) when the procedure allows appellate counsel to submit a letter asserting the "bare conclusion" that the appeal is without merit; and (4) when the procedure only provides one level of review. Id. at 279, 120 S.Ct. 746.
¶ 12. In Turner, we approved the following procedure for use when defendant's appellate counsel believes an indigent defendant's appeal to be frivolous:
The appellate counsel must:
(1) determine that the defendant is "unlikely to prevail on appeal."
(2) file a brief indicating "that he scoured the record thoroughly[,]" and "refer[] to anything in the record that might arguably support the appeal[,]" and
(3) advise client of his right to file a pro se supplemental brief.
At this point, the appellate court shall then make its own independent review of the record, in the manner followed in all other cases.
Turner, 818 So.2d at 1189 (citations omitted).
¶ 13. Today, based on the sound logic and admonition of the Supreme Court's holding in Robbins, we overrule Turner in part.
¶ 14. First, by requiring appellate counsel to determine the client is merely "unlikely to prevail on appeal," we inadvertently endorsed one of the very problems which the Supreme Court found to render such a procedure unconstitutional. It is more than a matter of semantics that led the Robbins Court to draw a distinction between a claimant who is unlikely to prevail on appeal and one whose claims are altogether frivolous. A claim is frivolous when it is "lacking in arguable issues." Robbins, 528 U.S. at 279-80, 120 S.Ct. 746. Although Lindsey may indeed be unlikely to prevail in this appeal, that does not mean his arguments reach the level of *747 frivolity (i.e. that he presents no arguable issues), and requiring his attorney to make such an argument explicitly violates Robbins.
¶ 15. The second problem with the Turner procedure is less obvious than the first. According to Robbins, a procedure is unconstitutional where either the appellate court allows counsel to withdraw before the court determines whether the appeal is frivolous or where a procedure makes no provision for the court to receive a brief on the merits after finding arguable issues. Id. at 280, 120 S.Ct. 746. Under Turner, when appellate counsel files a brief with the appellate court, the client is concurrently advised of his or her right to file a pro se brief. Turner, 818 So.2d at 1189. Thereafter, the appellate court must "make its own independent review of the record." Id. This procedure potentially leaves the impression that once the attorney has filed the Turner brief, he or she is discharged of his or her duty to represent the indigent client. It is true that Turner does not explicitly state the attorney is relieved of his or her duties prior to the appellate court's determination of whether defendant's appeal is frivolous. But neither does the Turner rule expressly state there is any further obligation after the attorney has submitted the appellate brief, even if a nonfrivolous issue exists in the record.
¶ 16. In the case at hand, Lindsey's appellate counsel filed a one-and-a-half page brief on his behalf, merely asserting that he had complied with Turner and that he regarded Lindsey's appeal to be without merit since it was "unlikely to prevail on appeal." He then requested twenty-five days for Lindsey to file a pro se brief. The brief filed on behalf of Lindsey was deficient even under Turner since it did not refer to "anything in the record that might arguably support the appeal." Turner, 818 So.2d at 1189. However, it is understandable how Turner's requirement that the attorney determine his client is "unlikely to prevail on appeal" lends itself to the assumption by attorneys that they have no obligation to make further contentions in their briefs to the appellate court. We conclude the better practice is to have a procedure which requires supplemental briefing where appellate counsel has filed an inadequate brief. Robbins, 528 U.S. at 280, 120 S.Ct. 746 (citing Anders v. California, 386 U.S. at 740, n. 2, 87 S.Ct. 1396 and People v. Wende, 25 Cal.3d 436, 158 Cal.Rptr. 839, 600 P.2d 1071, 1075 n. 3 (1979)).
¶ 17. We therefore overrule Turner in part, rectifying the constitutional problems with our procedure governing appeals by indigent criminal defendants. We first note that, under the sound guidance of the Supreme Court, we refrain from replacing the requirement that appellate counsel determine that defendant is "unlikely to prevail on appeal" with a requirement that appellate counsel determine that all of the client's claims are frivolous. The Court rightly noted the conundrum faced by appellate attorneys forced to make any assertions under Anders procedures about the frivolity of their client's argument: "[There is] some tension both with counsel's ethical duty as an officer of the court (which requires him not to present frivolous arguments) and also with his duty to further his client's interests (which might not permit counsel to characterize his client's claims as frivolous)." Robbins, 528 U.S. at 281-82, 120 S.Ct. 746 (footnote omitted); see also Miss. R. Prof'l Conduct 3.1 & cmt. (2004) (barring attorneys from making frivolous arguments and defining such arguments as those where attorney is "unable either to make a good faith argument on the merits of the action taken or to support the action *748 taken by a good faith argument for an extension, modification or reversal of existing law."). The Court then commended California's effort to rectify this problem by (1) "not requiring counsel to explicitly describe the case as frivolous" and (2) by allowing attorneys who determine that a case is frivolous to limit their briefs to a statement of the facts and applicable law. Robbins, 528 U.S. at 282, 120 S.Ct. 746 (citing People v. Wende, 158 Cal.Rptr. 839, 600 P.2d at 1073).[5]
¶ 18. In accord with Robbins, we overrule Turner in part and implement the following procedure to govern cases where appellate counsel represents an indigent criminal defendant and does not believe his or her client's case presents any arguable issues on appeal:
(1) Counsel must file and serve a brief in compliance with Mississippi Rule of Appellate Procedure 28(a)(1)-(4),(7);[6]see also Robbins, 528 U.S. at 280-81, 120 S.Ct. 746 (stating that "[c]ounsel's summary of the case's procedural and factual history, with citations of the record, both ensures that a trained legal eye has searched the record for arguable issues and assists the reviewing court in its own evaluation of the case.").
(2) As a part of the brief filed in compliance with Rule 28, counsel must certify that there are no arguable issues supporting the client's appeal, and he or she has reached this conclusion after scouring the record thoroughly, specifically examining: (a) the reason for the arrest and the circumstances surrounding arrest; (b) any possible violations of the client's right to counsel; (c) the entire trial transcript; (d) all rulings of the trial court; (e) possible prosecutorial misconduct; (f) all jury instructions; (g) all exhibits, whether admitted into evidence or not; and (h) possible misapplication of the law in sentencing. See Robbins, 528 U.S. at 280-81, 120 S.Ct. 746; Turner, 818 So.2d at 1189.
(3) Counsel must then send a copy of the appellate brief to the defendant, inform the client that counsel could find no arguable issues in the record, and advise the client of his or her right to file a pro se brief. Turner, 818 So.2d at 1189; cf. Wende, 600 P.2d at 1074.[7]
(4) Should the defendant then raise any arguable issue or should the appellate court discover any arguable issue in its review of the record, the court must, if circumstances warrant, require appellate counsel to submit supplemental briefing on the issue, regardless of the probability of the defendant's success on appeal. Robbins, 528 U.S. at 280, 120 S.Ct. 746 (citing Wende, 158 Cal.Rptr. 839, 600 P.2d at 1074).
(5) Once briefing is complete, the appellate court must consider the case on its merits and render a decision.
*749 ¶ 19. Although this procedure more effectively implements the constitutional mandates of Robbins, we do not create or imply a right to post-conviction relief for those cases decided under Turner. In spite of its flaws, the Turner procedure at least required that we conduct an independent review of the record. Turner, 818 So.2d at 1189. In doing so, our appellate review afforded the protection to indigent clients they might not have otherwise received from their attorneys and satisfies any concerns we may have otherwise had as to whether indigent clients received constitutionally adequate representation under Turner. See, e.g., Sayles v. State, 823 So.2d 537, 540-41 (Miss.2002) (raising issue of sufficiency of evidence after independent review of record although neither appellate counsel nor appellant raised issue on appeal).
¶ 20. The purpose of applying more stringent protective measures is simply to safeguard the constitutional right to counsel which is afforded to indigent criminal defendants throughout the entirety of appellate proceedings. See Robbins, 528 U.S. at 280, 120 S.Ct. 746. Although we remain steadfast in our refusal to subsidize frivolous appeals, we also recognize the essential role of appellate attorneys in helping us accomplish this goal. Attorneys who thoroughly brief the claims of indigent appellants not only provide invaluable assistance to their clients and appellate courts, they eliminate the costs to the State that will inevitably result when attorneys fail to comply with the requirements articulated today. Because Lindsey's attorney has submitted a brief simply concluding that his client's claim has no merit, we order him to submit a supplemental brief in compliance with this opinion.
CONCLUSION
¶ 21. We overrule the Turner procedure in part in order to afford adequate and effective counsel to those indigent clients whose attorneys do not believe they have arguable issues to present the appellate court. We direct that the briefing schedule in this appeal be reopened for additional briefing consistent with this opinion. The Clerk of this Court shall notify the parties of the new briefing schedule. See M.R.A.P. 31.
¶ 22. SUPPLEMENTAL BRIEFING ORDERED.
SMITH, C.J., COBB, P.J., EASLEY, CARLSON, DICKINSON AND RANDOLPH, JJ., CONCUR. GRAVES, J., CONCURS IN RESULT ONLY. DIAZ, J., NOT PARTICIPATING.
NOTES
[1] Turner was our response to United States Supreme Court precedent as well as Fifth Circuit criticism of our former Killingsworth procedure which consisted of the following: "Where counsel regards the appeal without merit and deems it his obligation to so state to the Court, the full protection of the rights of the accused require that he receive a copy of the representation counsel has made to the Court and be furnished a reasonable opportunity to file his own comments and raise any additional points that he chooses." Killingsworth, 490 So.2d 849, 851 (Miss.1986).
[2] At the time of trial, Odom was in jail for an unrelated charge.
[3] We commend the State for acknowledging this problem, and note that it has previously done so in the past. See Brewer v. State, 834 So.2d 36, 38 (Miss.2003)(noting State's request that we revisit Turner but declining to do so for procedural reasons); accord Evans v. State, 813 So.2d 724, 726-27, 729 (Miss. 2002). In specifically discussing the constitutional deficiencies in our current procedure, it has greatly assisted the Court in refining our jurisprudence.
[4] The Court also noted that it would be especially egregious for an appellate court to decide the appeal without counsel if the court discovered arguable issues. Robbins, 528 U.S. at 280, 120 S.Ct. 746 (citing Penson v. Ohio, 488 U.S. 75, 83, 109 S.Ct. 346, 102 L.Ed.2d 300 (1988)).
[5] By no means do we imply that an indigent client has received unconstitutional representation because his or her attorney referred to the client's claims as "frivolous." Instead, this particular aspect of our opinion seeks to alleviate any potential concerns an attorney may have about compliance with Mississippi Rules of Professional Conduct and has no effect on the constitutional rights of indigent clients.
[6] We note that since counsel does not actually present an argument when filing a Turner brief, it would be impossible to comply with Mississippi Rule of Appellate Procedure 28(a)(5)-(6).
[7] California's Wende procedure allows appellate counsel to withdraw when it finds the attorney has adequately discharged his duty to set forth the facts and present the applicable law. See Wende, 158 Cal.Rptr. 839, 600 P.2d at 1073-74. We decline to adopt this approach in order to avoid temporarily leaving the defendant without the benefit of counsel and possibly necessitating the appointment of new counsel. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614477/ | 939 So.2d 1146 (2006)
JOSE G. PUIG, JR., P.E., Appellant,
v.
FLORIDA ENGINEERS MANAGEMENT CORP., Appellee.
Case No. 3D06-298.
District Court of Appeal of Florida, Third District.
Opinion filed October 18, 2006.
Reiner & Reiner and Samuel B. Reiner, II, for appellant.
Bruce A. Campbell (Tallahassee), for appellee.
Before COPE, C.J., and FLETCHER and ROTHENBERG, JJ.
FLETCHER, Judge.
Jose G. Puig, Jr., P.E. (Puig) appeals from a final order of the Florida Engineers Management Corporation (FEMC) which rejected an administrative law judge's recommendation that an administrative complaint against Puig be dismissed. We reverse.
On September 30, 2004, FEMC filed an administrative complaint against Puig, a licensed engineer, alleging violations of sections 471.033(1)(a)&(j) and 455.227(1)(a)&(j), Florida Statutes (2004), which prohibit sealing plans not prepared by, or under the supervision of, the engineer and assisting an unlicensed person in the practice of engineering. The specific charges against Puig were that he sealed plans to two projects under contract to Orlando Naranjo, whose license to practice engineering had been revoked in September of 2001. Puig denied the charges against him.
At an evidentiary hearing before an administrative law judge, Puig testified that he assumed the role of engineer of record on the Tora Emes and Manatee Village projects as a favor to Naranjo and without compensation. Puig affirmed that he reviewed the work done prior to his involvement, directed and instructed Naranjo and his employees in drafting work, and oversaw completion of the design work before finally affixing his signature and seal to the plans. He admitted, however, that all documents relating to the projects remained in Naranjo's offices which were located next to his own offices.
The administrative law judge issued a detailed order concluding that Puig "affirmatively established, through his own credible testimony, which was corroborated by the testimony of other witnesses, that the plans he signed and sealed . . . were prepared under his responsible supervision, direction, and control," and "he did not do anything intended to aid or assist in the unlicensed practice of engineering." He, therefore, recommended that the complaint be dismissed. Upon review, FEMC rejected this recommendation and imposed penalties, including an administrative fine and costs.
A hearing officer's findings based on competent, substantial evidence may not be rejected by an administrative agency. Packer v. Orange County School Bd., 881 So. 2d 1204 (Fla. 5th DCA 2004). Nor may the agency avoid this responsibility by labeling the findings as conclusions of law. McMillan v. Broward County School Bd., 834 So. 2d 903 (Fla. 4th DCA 2003). Here, FEMC objected to the finding that Puig did not intend to assist Naranjo in the unlicensed practice of engineering deeming this to be a conclusion of law not supported by the language of Sections 471.033 and 455.227. Whether or not Puig intended to violate the statute, however, is not the point at issue. The only acts upon which an alleged violation of the statutes is predicated are the signing and sealing of the plans for the two projects contracted to Naranjo. The hearing officer, in its role as a finder of fact and based on competent substantial evidence, determined that the plans were properly sealed under Puig's active supervision and control when he assumed the role of engineer of record on the two projects. Because the acts, upon which the violations were predicated, were disproved, Puig could not be found to be in violation of the statutes.
We, therefore, reverse and remand with instructions that the administrative law judge's recommended order be approved.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DISPOSED OF. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614482/ | 939 So.2d 861 (2006)
In the Matter of the ESTATE OF Samuel B. MINOR, Deceased.
Tony Trask and Ethel Young, Appellants
v.
Halla Minor, Jr., Executor of the Last Will and Testament of Samuel B. Minor, Appellee.
No. 2005-CA-00442-COA.
Court of Appeals of Mississippi.
October 10, 2006.
*863 David S. Crawford, Ron Senko, Woodville, attorneys for appellants.
Holmes Sturgeon, attorney for appellee.
Before LEE, P.J., CHANDLER, GRIFFIS, and ROBERTS, JJ.
GRIFFIS, J., for the Court.
¶ 1. Tony Trask and Ethel Young filed a petition to establish paternity and to contest the Last Will and Testament of Samuel B. Minor. They alleged the will was void due to Halla Minor, Jr.'s undue influence. The chancellor upheld the will. Trask and Young appeal and argue the chancellor erred (1) in his evaluation of the evidence, (2) in his analysis of the evidence, (3) in his application of the evidence, and (4) in his determination that Minor overcame the presumption of undue influence. We find no error and affirm.
FACTS
¶ 2. Samuel Minor ("Judge Minor") owned 100 acres of land in Wilkinson County, Mississippi. He was a farmer, deacon, local historian, and former justice of the peace. His wife predeceased him, and he had no children.
¶ 3. In 1994, Judge Minor executed his first will. He divided his land among Trask, Halla, Young, and eight others. Judge Minor's personal property was divided among Halla, Young, and five others. Halla was left the most land, including Judge Minor's house, as well as the most personal property.
¶ 4. In the mid-eighties, Judge Minor was involved in a car accident. At his request, nephew Halla moved in, took care of him, and helped on the farm. Judge Minor offered to pay Halla in exchange for these services, but he told Judge Minor there was no need. In 2000, Judge Minor was involved in another car accident. As a result, he was confined to a wheelchair. He was eventually dependent on Halla for transportation, cleaning, bathing, dressing, etc. Halla's mother Beatrice provided meals. Because Judge Minor's disability made it difficult to get inside the bank, he added Halla as a signatory on his checking account. Judge Minor also gave Halla a copy of the key to his safety deposit box.
¶ 5. In June of 2001, Judge Minor attempted to call his attorney several times regarding his will and land survey. The survey suggested Judge Minor owned seventy acres. He was concerned, because he had willed away 100 acres. Late that month, he had Halla drive him to the grocery store. Halla went inside, and Judge Minor stayed in the truck. Judge Minor spotted his attorney Alonzo Sturgeon and told Sturgeon that he had researched durable powers of attorney. Judge Minor directed Sturgeon to give his durable power of attorney to Halla. Judge Minor also directed Sturgeon to change the 1994 will. Judge Minor wanted all his land to be kept in the Minor family name. He also wanted to give it to Halla in appreciation of the fact that Halla had *864 taken care of him. He met once more with Sturgeon about the changes he wanted. Halla drove him this time also and went across the street to a service station while Judge Minor and Sturgeon discussed the will.
¶ 6. On July 9, Halla took Judge Minor to the doctor for his monthly check up. While he was there he was also screened for a nursing home, on the advice of Judge Minor's home health nurse. She advised him that he could be placed in a nursing home in the event that Halla had to be away on weekends. Judge Minor was never placed in a nursing home.
¶ 7. Judge Minor executed his new will at his home on July 11. He bequeathed $500 apiece to Samuel Booker T. Shepard, J.T. Shepard, Nemiah Smith, Trask, and Young. He bequeathed the remaining funds in his checking account to Halla and Young. All else was left to Halla. Halla was outside working in the field during this time. His fiancee, Shirley McPipe was in the house but excused herself from the room. After the will was signed, Judge Minor instructed Halla to pay the attorney's bill. Halla did so with a check from Judge Minor's checkbook.
¶ 8. The following October, Judge Minor died.
STANDARD OF REVIEW
¶ 9. Undue influence is a question of fact. Watkins v. Watkins, 142 Miss. 210, 229, 106 So. 753, 755 (1926). A chancellor's findings of fact will not be disturbed unless manifestly wrong or clearly erroneous. Sanderson v. Sanderson, 824 So.2d 623, 625(¶ 8) (Miss.2002). This Court will not disturb the findings of a chancellor when supported by substantial credible evidence unless the chancellor abused his or her discretion, was manifestly wrong, clearly erroneous, or an erroneous legal standard was applied. Id. at 625-26(¶ 8). Legal questions are reviewed de novo. Russell v. Performance Toyota, Inc., 826 So.2d 719, 721(¶ 5) (Miss.2002).
ANALYSIS
¶ 10. Although Trask and Young list four issues, all the issues go to whether Halla overcame the presumption of undue influence. Trask and Young argue that Halla did not meet the clear and convincing burden of proof, because their evidence was more credible. They also question the sufficiency of Halla's evidence. Halla responds he provided sufficient evidence to overcome the presumption of undue influence.
¶ 11. A will secured through undue influence is not valid. Madden v. Rhodes, 626 So.2d 608, 623 (Miss.1993). A presumption of undue influence arises when there is a confidential relationship, and the fiduciary took some active part in getting the will written. Croft v. Alder, 237 Miss. 713, 722-23, 115 So.2d 683, 686 (1959).
¶ 12. Once the presumption is established, the burden shifts to the fiduciary to rebut the presumption by clear and convincing evidence. Id. In order for Halla to overcome the presumption, he must show (1) that he exhibited good faith in the fiduciary relationship with Judge Minor; (2) Judge Minor acted with knowledge and deliberation when he executed his will, and (3) Judge Minor exhibited independent consent and action. Rogers v. Pleasant, 729 So.2d 192, 193(¶ 7) (Miss.1998).
¶ 13. First, we consider whether there was substantial credible evidence that Halla acted in good faith. To determine this element, we must examine five factors: (1) who sought the preparation of the will, (2) where and in whose presence was the will executed, (3) what was the fee that was paid to execute the will, (4) who paid the *865 fee, and (5) was the will executed openly or secretly. Id. at 194 (¶¶ 8-11). Halla testified that it was Judge Minor's idea to visit the attorney, and Halla did not know why. There was testimony that Judge Minor had called Sturgeon several times during the month of June 2001. Mr. Sturgeon testified it was Judge Minor who approached him about drafting his will. The will was executed at Judge Minor's home in the presence of Mrs. Sturgeon, Edward and Sedonia Anthony, and Cora Sherman. Mrs. Sturgeon and Judge Minor went over the contents of the will alone in the kitchen. The will was signed in the living room in the presence of Mrs. Sturgeon, the Anthonys, and Sherman. Halla was outside working, and his fiancee was neither in the kitchen nor living room. The fees for the will and power of attorney were paid together at $327. Judge Minor paid the fees. The will execution was quite open, as it was in the middle of the day, in Judge Minor's living room, in front of three witnesses, none of whom were beneficiaries. We find there was substantial credible evidence to support the chancellor's finding that Halla acted in good faith.
¶ 14. Next, we look at whether Judge Minor acted with knowledge and deliberation when the will was executed. We must consider four factors: (1) Judge Minor's awareness of his total assets and their general value, (2) an understanding by Judge Minor of the persons who would be the natural inheritors of his bounty under the laws of intestacy or under a prior will and how the proposed change would legally effect the prior will or natural distribution, (3) whether non-relative beneficiaries would be excluded or included, and (4) knowledge of who controls Judge Minor's finances and business and by what method, and if controlled by another, how dependent was Judge Minor on him and how susceptible to his influence. Id. at 194(¶ 13).
¶ 15. When discussing the changes to the will, Mr. Sturgeon questioned Judge Minor about his assets. They discussed the survey that showed Judge Minor only owned seventy acres. He was aware that this was different than his understanding that he always had 100 acres. Mr. Sturgeon testified that Judge Minor knew he owned a main house and a smaller house. He was aware of his LTD automobile, but felt that since it was not running, it would not be worth what it would cost any beneficiary to fix. Judge Minor accurately recounted that he had $2,500 in his bedroom. He knew of his checking account at Commercial Bank. He correctly believed he did not have any money left over in the Masonic Relief Fund. He did not know if he ever had any in the State Retirement System. He instructed Mr. Sturgeon to check on both these funds. Trask testified that Judge Minor was aware of the timber on his land and its value. Finally, Halla testified that Judge Minor was aware that Young was stealing items of personal property out of his house. There was a question about whether he knew he still had a cow.
¶ 16. Sturgeon and Celeste Holland testified that Judge Minor understood that his 1994 will divided up the land among related and non-related parties. He now wanted the land kept intact and given to a Minor. He also wanted the land given to a person who was going to stay on it and use it. He knew Halla was a likely candidate, because he stayed and helped on the farm for many years. Judge Minor understood the new will was disinheriting several people out of land. He provided for five of those people to be given cash. Mr. Sturgeon suggested he just do a deed to Halla and reserve a life estate in himself. Judge *866 Minor said no, he wanted a will recorded in the Chancery Court's will book.
¶ 17. The same non-relative beneficiaries, inter alia Trask and Young, who had been included in the first will were included in the second will. However, these beneficiaries were given smaller inheritances in favor of Judge Minor's nephew Halla.
¶ 18. Finally, the testimony was that Judge Minor was in charge of his finances and business. Halla served as his "legs." There was testimony from several witnesses that Judge Minor was in charge, and Halla only did "what the Judge sa[id] do." Judge Minor made the decision to have Halla added as a signatory on his account. Halla never exercised this power unless instructed by Judge Minor. It was Judge Minor's decision to give Halla an extra key to his safety deposit box. Halla only opened the safety deposit box once and that was at Judge Minor's instruction. It was Judge Minor's decision to give Halla power of attorney. Halla never acted on his power of attorney. The only financial decision he was able to talk Judge Minor into was to buy a certificate of deposit on which the Judge drew interest. Halla deposited Judge Minor's Social Security checks into the Judge's account. Judge Minor exclusively handled his landlord-tenant relationship with hunters who leased the smaller house on his land. Judge Minor handled his own land survey and will drafting. There was substantial credible evidence to support the chancellor's finding that Judge Minor acted with knowledge and deliberation when the will was executed.
¶ 19. The final element we must examine is whether Judge Minor exhibited independent consent and action. Several witnesses testified that Judge Minor was an intelligent, sharp and strong-willed individual, and this never changed despite his age. Judge Minor initiated the new will, without telling Halla. Although Halla drove his ninety-seven-year-old uncle to the lawyer's office, he did not know the purpose of the visit and excused himself from all three discussions about the will.
¶ 20. Holland testified that Judge Minor had previously confided in her, outside of Halla's presence, that he wanted all the land to go to Halla. Mrs. Sturgeon read the will paragraph-by-paragraph to Judge Minor. At the end of each he replied, "That's what I want." Mrs. Sturgeon then testified that she had Judge Minor read the will. Mr. Anthony testified that he overheard Judge Minor tell Mrs. Sturgeon that the will was what he wanted. Sherman testified that when Mrs. Sturgeon and Judge Minor returned from reading the will in the kitchen, Judge Minor remarked, "I always read what I sign." He then signed the will. All the witnesses to the will execution testified Judge Minor was in good spirits. Jessie Stewart testified that he visited Judge Minor later that same day. Outside of Halla's presence, Judge Minor told Stewart that he was happy, because he had just executed his will. The supreme court has affirmed a finding of independent consent and action where the fiduciary was ignorant of the new will and the testator was strong-willed. Id. at 194-95(¶ 18). That being the case here, we likewise affirm the finding of independent consent and action.
¶ 21. In sum, there was substantial credible evidence to support the chancellor's finding that Halla overcame the presumption of undue influence by clear and convincing evidence.
¶ 22. Nevertheless, Trask and Young insist that there was conflicting evidence, so Halla cannot be said to have borne his burden of proof. That evidence is in conflict means only that there is a triable issue. It does not prevent a trier of fact *867 from assessing whether one side has proven its case by clear and convincing evidence. See, e.g., Bacot v. Duby, 724 So.2d 410, 419(¶ 44) (Miss.Ct.App.1998) (holding that whether adverse possession was proven by clear and convincing evidence is a factual determination made by the chancellor).
¶ 23. Trask and Young next urge that whether facts were proven by clear and convincing evidence is a question of law, and therefore we must conduct a de novo review of the evidence. To support this contention they cite In re Will of Carney, 758 So.2d 1017 (Miss.2000), and In re Estate of Homburg, 697 So.2d 1154 (Miss. 1997). Both of these cases say that application of the rules of construction and interpreting the testator's intent are questions of law. Carney, 758 So.2d at 1019(¶ 8); Homburg, 697 So.2d at 1157 (¶¶ 10-11). These cases do not say that whether a burden of proof is met is a question of law. Indeed, it is one of fact.
¶ 24. Finally, Trask and Young maintain that Halla did not sustain his burden of proof, because their witnesses were more credible. The chancellor found Halla to be a credible witness. In assessing conflicting evidence, the chancellor, sitting as the trier of fact, retains the sole authority to determine the credibility of the witnesses. Mullins v. Ratcliff, 515 So.2d 1183, 1189 (Miss. 1987). We give deference to the chancellor's credibility findings since he is the only one who hears the testimony and observes the demeanor of witnesses. In re Estate of Carter, 912 So.2d 138, 143(¶ 18) (Miss.2005). He is in the best position to judge their credibility, and it is not this Court's province to undermine the chancellor's authority by replacing his judgment with our own. Id.
¶ 25. We affirm the chancellor's finding that the Last Will and Testament of Samuel B. Minor, dated July 11, 2001, was not the product of undue influence.
¶ 26. THE JUDGMENT OF THE CHANCERY COURT OF WILKINSON COUNTY IS HEREBY AFFIRMED. ALL COSTS OF THIS APPEAL ARE ASSESSED TO THE APPELLANTS.
KING, C.J., LEE AND MYERS, P.JJ., SOUTHWICK, IRVING, CHANDLER, BARNES, ISHEE AND ROBERTS, JJ., CONCUR. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614490/ | 497 F.Supp. 1173 (1980)
COMMONWEALTH OF PENNSYLVANIA DEPARTMENT OF ENVIRONMENTAL RESOURCES, Plaintiff,
v.
WILLIAMSPORT SANITARY AUTHORITY, and all other Pennsylvania municipal authorities, municipalities or persons similarly situated et al., Defendants.
Civ. No. 79-690.
United States District Court, M. D. Pennsylvania.
September 15, 1980.
As Corrected November 20, 1980.
*1174 *1175 Michael S. Alushin, Asst. Atty. Gen., DER, Harrisburg, Pa., for plaintiff.
Ann S. Pepperman, Brett O. Feese, McNerney, Page, Vanderlin & Hall, Williamsport, Pa., for defendants.
OPINION
MUIR, District Judge.
I. Introduction.
This case requires the Court to determine whether the Commonwealth of Pennsylvania, *1176 Department of Environmental Resources (DER) or the Williamsport Sanitary Authority was entitled to the $198,600.00 paid to DER in July 1974 by the United States Environmental Protection Agency (EPA) pursuant to § 206(a) of the 1972 amendments to the Water Pollution Control Act, 33 U.S.C. § 1286(a). If the Court concludes that the Sanitary Authority was entitled to the money, the Court must determine whether the Eleventh Amendment bars relief in this case.
An action for declaratory relief was commenced by DER in the Commonwealth Court of Pennsylvania and removed to this Court pursuant to 28 U.S.C. § 1441. The Authority has asserted counterclaims for damages, declaratory relief, and injunctive relief. The Court has previously dismissed the counterclaims against DER because they are barred by the Eleventh Amendment. Because the individual counterclaim defendants are being sued in their official capacities, the Court will refer to them as DER.
The case was tried to the Court from August 25 to August 27, 1980. The following constitute the Court's findings of fact, discussion, and conclusions of law.
II. Findings of Fact.
1. The Plaintiff is the Commonwealth of Pennsylvania, Department of Environmental Resources (DER) with principal offices at 9th Floor, Fulton Building, 3rd and Locust Streets, Harrisburg, Pennsylvania, 17120 (Undisputed fact, hereinafter designated U).
2. The Defendant and Counterclaim Plaintiff is the Williamsport Sanitary Authority, WSA, the Sanitary Authority or the Authority. (U)
3. The WSA is a municipal corporation incorporated pursuant to the terms of the Municipality Authorities Act of 1945, 53 P.S. §§ 301 et seq. Its principal office and place of business is at 253 West Fourth Street, Williamsport, Pennsylvania, 17701. (U)
4. Counterclaim Defendant Clifford L. Jones is Secretary of the Commonwealth Department of Environmental Resources. He has held this position since February 1979. (U)
5. Counterclaim Defendant Louis W. Bercheni is Director, Bureau of Water Quality Management, Commonwealth Department of Environmental Resources. He has held this position since February 1980. From April 1979 until February 1980 he held the position of Acting Director, Bureau of Water Quality Management. (U)
6. Counterclaim Defendant Cedric Karper is Chief, Planning and Evaluation Section, Division of Sewerage and Grants, Commonwealth Department of Environmental Resources. He has held this position since April 1979. (U)
7. Counterclaim Defendant Mark Roller is Regional Director, Environmental Protection, Commonwealth Department of Environmental Resources. He has held this position since June 1978. From January 1970 until June 1978 he was Williamsport Regional Sanitary Engineer, Commonwealth Department of Environmental Resources. (U)
8. The WSA initially constructed its sewerage facilities in 1953. (U)
9. The WSA facilities consist of two plants, the Central Plant and the West Plant, both of which facilities are owned by the WSA. (U)
10. The cost of these sewerage facilities was $5,100,000.00. (U)
11. The funding for this project was provided from local funds, to-wit, a bond issue in the amount of $5,100,000.00, with the exception of a state grant-in aid in the amount of $26,725.54 toward the engineering expenses for the project paid to the City of Williamsport. (U)
12. No federal funding was received for the initial construction project. (U)
13. In 1969, the WSA received an order from the Commonwealth Department of Health, one of the predecessor agencies to DER, instructing the WSA to upgrade its treatment at its two sewage treatment plants, the Central Plant and the West Plant, to secondary treatment. (Defendant's Exhibits 122-123). (U)
*1177 14. The purpose of this upgrading was to protect the waters of the Susquehanna River. (U)
15. The upgrading took the form of a planning, design, and construction project, hereinafter for reference purposes only sometimes referred to as "Project No. 420486", "Project No. C-420486", or "Project WPC Pa. 486". (U)
16. This construction project to upgrade the WSA's facilities undertaken by the WSA and for which the WSA was responsible was solely the WSA's construction project.
17. The WSA, not DER, designed and planned Project No. 420486, contracted with the engineers for this project, and entered into the construction contracts with the contractors.
18. The WSA, not DER, was responsible for the day-to-day operations of and general supervision of Project No. 420486.
19. The WSA, not DER, had both the direct and ultimate financial responsibility for Project No. 420486 and for complying with the order to upgrade its sewage treatment facilities.
20. The cost of Project No. 420486 was $4,094,752.86. (U)
21. The "eligible costs" of Project No. 420486 were $4,060,752.86. (U)
22. "Eligible costs" as used herein means costs which can be included for federal construction grant participation. (U)
23. The WSA applied for a federal construction grant under § 8(b) of the Federal Water Pollution Control Act, P.L. 84-660, for its construction Project No. 420486.
24. The WSA applied for state grant funds under the Pennsylvania Land and Water Conservation and Reclamation Act, Act No. 443 of 1968, 32 P.S. §§ 5101 et seq., in particular, under 32 P.S. § 5116 (hereinafter referred to as "Act 443"). (U)
25. The WSA originally applied for and was awarded a grant in the amount not to exceed $851,600.00 from the DER. (U)
26. At the time the state grant of $851,600.00 was made, § 206(a) had not yet been enacted. (U)
27. The WSA's grant was later adjusted, because the actual construction costs of the project were less than the amount estimated at the time of the application, to $802,400.00. (U)
28. The WSA received $802,400.00 in state grant funds under Act 443. This was the full amount authorized by the grant offer. (U)
29. The WSA's state grant was awarded under Act 443, in particular, under 32 P.S. § 5116. (U)
30. The WSA's state grant contained, inter alia, the following Terms of Offer:
1. In the event the actual cost of the project is less than the estimated cost upon which the grant offer is based, such actual cost shall be used to determine the amount of the state grant and the grant shall be reduced as necessary.
2. Project accounting and fiscal records relative to state grant assistance shall be maintained and be accessible to duly authorized representatives of the DER for the purpose of audit and examination.
3. All funds granted pursuant to the Land and Water Conservation and Reclamation Act shall be expended solely for carrying out the approved project.
4. The applicant must adhere to the project construction schedule listed on the federal application form, except that under item c.2. the time limit must not be greater than 100 days. Any required additional documentation must be submitted within 30 days of request. (U)
31. Since January, 1978, the DER has been using a new form for grants awarded under the Pennsylvania Land and Water Conservation and Reclamation Act, Act 443. This new form for state grants includes the following condition: "If any additional Federal funds become available for this project, it is the Commonwealth of Pennsylvania's intent to recoup any or all of the Land and Water Conservation and Reclamation Act funds paid to the Authority for this project." (Exhibit D14) (U)
*1178 32. The state grant offer was signed by William Saltzer on behalf of the DER on February 24, 1971 and was accepted on behalf of the WSA by John C. Youngman, Sr., on March 3, 1971. (U)
33. The WSA used the grant it received under the Pennsylvania Land and Water Conservation and Reclamation Act, Act 443, for construction of its secondary sewage treatment facilities for its Central and West Plants, which secondary treatment facilities provided added protection for the waters of the West Branch of the Susquehanna River. (U)
34. The WSA has performed all of its obligations under the terms of this state grant agreement.
35. This state grant did not set forth that it was pre-financing for the federal share of Project No. 420486. (Exhibit P-3).
36. This state grant did not set forth that it was refundable or subject to reimbursement by WSA or any other party, other than in the event the actual costs of the project were less than the estimated costs on which the grant was based. (Exhibit P-3).
37. The DER administered the sewerage construction grant programs under Act 443 to accomplish two goals: (1) to qualify projects for the highest level of federal funding available in any funding year and (2) to insure equity among projects funded in any funding year by equalizing the combined federal-state grants of each year.
38. The 1971 Grant Agreement between the DER and the WSA contains no provision barring Pennsylvania DER from accepting subsequent federal funding to augment its Act 443 grant program.
39. The 1971 Grant Agreement between the DER and the WSA contains no promise by the DER to forego any subsequent federal funding which may become available to augment its state grant program.
40. There is no provision in the 1971 Grant Agreement between the DER and the WSA by which the DER agreed to pay to the WSA federal funds for which the DER may become eligible after the execution of the 1971 Grant Agreement.
41. There is no provision in the 1971 Grant Agreement between the DER and the WSA by which any individual counterclaim Defendant in his official capacity agreed to pay any § 206(a) money to the WSA.
42. Since 1954, WSA has received an annual grant for its operating costs in the amount of 2% of the construction costs of its facilities, less the amount of any federal or state construction assistance under Act 339 of 1953, 35 P.S. §§ 701-703, hereinafter Act 339.
43. The grant payments made to WSA under Act 339 were placed into the WSA's operating budget and have been used solely for the operating costs of the WSA.
44. The grant payments made to the WSA under Act 339 were for the WSA's operating expenses, not for capital improvements or construction costs.
45. The 2% annual operating costs state grants under Act 339 received by WSA were unconditional.
46. The 2% annual operating costs state grants under Act 339 received by WSA were not prefinancing for future federal grants and were not subject to reimbursement.
47. WSA was never advised that the 2% state operating grants under Act 339 were pre-financing for future federal grants or subject to reimbursement.
48. WSA used the 2% state grants it received under Act 339 for the purposes specified by the Act and intended by DER.
49. The payments pursuant to Act 339 to the WSA prior to November 17, 1972 totalled approximately $1,121,649.00. (U)
50. The grant payments received by WSA attributable to Project 420486 pursuant to Act 339 totalled $200,835.99 for the period 1973-1978.
51. The grants pursuant to Act 339 were annual payments based on a percentage of the cost of construction and acquisition of sewage treatment plants which represent an additional state contribution to the WSA's sewage treatment plants.
*1179 52. WSA expended the funds it received under the Land and Water Conservation and Reclamation Act and under Act 339 with the understanding that the grants were outright, unconditional grants, not subject to repayment or reimbursement by WSA or any other party other than as set forth in the "Terms of Offer."
53. WSA's understanding that the state grants to it were not subject to reimbursement, other than as set forth in the "Terms of Offer," and were not pre-financing, and its expenditure of these funds based on this understanding, was reasonable and in good faith.
54. The WSA applied for a federal construction grant for Project No. 420486 under § 8(b) of the Federal Water Pollution Control Act, P.L. 84-660. (Exhibit D-2). (U)
55. State grants under both Act 339 and Act 443 were certified by the DER to be applied to meet state matching grant provisions under § 8(b) of the Federal Water Pollution Control Act, P.L. 84-660, then codified at 33 U.S.C. § 1158(b), the act in effect prior to the 1972 amendments. (Exhibits P-49 and P-56.) (U)
56. As a result of the certification under § 8(b) and the contribution of state funds under Act 339 and Act 443 WSA received a higher level of federal funding under the Federal Water Pollution Control Act, P.L. 84-660 than it would otherwise have received.
57. By letter dated February 19, 1971, Warren Carter of the U.S. EPA notified the WSA that the Authority was to be offered a federal grant in an amount not to exceed $1,703,200.00 and that the grant documents would be forwarded to the Authority through the DER and should be returned to the U.S. EPA through the DER. (Exhibit D-3.1) (U)
58. By letter dated December 3, 1971, the WSA was notified that it had received the federal grant. (Exhibit D-7) (U)
59. The WSA was awarded federal construction grant assistance under Section 8(b) of the Federal Water Pollution Control Act, P.L. 84-660, in the amount of 40% of its eligible costs. (U)
60. The $802,440.00 state grant to WSA under the Land and Water Conservation and Reclamation Act was the state matching grant for purposes of section 8(b) of the Federal Water Pollution Control Act.
61. The WSA also received a 10% planning grant under Section 8(f) of the Federal Water Pollution Control Act, P.L. 84-660. The Authority was notified of the award of a planning grant in the amount of 10% of the grant under section 8(b), $170,320.00, on August 11, 1971. (Exhibit D-46) (U)
62. The total federal grant assistance received by the WSA under the Federal Water Pollution Control Act, P.L. 84-660, was $1,765,360.00, 44% of the eligible costs. (U)
63. The WSA received all of the federal grant funding it was awarded under Sections 8(b) and (f) of the Federal Water Pollution Control Act, P.L. 84-660. (U)
64. The WSA was not eligible for the maximum amount of federal assistance under Section 8(b) of the Federal Water Pollution Control Act, P.L. 84-660, 55% of the eligible cost for Project No. 420486, because the DER had not enacted water quality standards for the West Branch of the Susquehanna River into which the Authority discharged. (U)
65. All of the municipalities and municipal authorities in Pennsylvania that received 50-55% federal funding under the Federal Water Pollution Control Act, P.L. 84-660, discharged into waters for which the Commonwealth of Pennsylvania or the appropriate agency had enacted the requisite water quality standards. (U)
66. The total federal grant assistance received by the WSA under the Federal Water Pollution Control Act, P.L. 84-660, was $1,765,360.00. (U)
67. Project No. 420486 was jointly funded by a 20% state contribution, a 44% federal contribution, and a 36% local contribution toward the total eligible project costs.
*1180 68. After being notified by telephone on April 17, 1972 that grants authorized by § 206(a) of the 1972 Amendments to the Water Pollution Control Act, P.L. 92-500, 33 U.S.C. § 1286(a), hereinafter referred to as "§ 206(a)" would be available, the DER acted speedily to notify potentially eligible parties.
69. The DER urged as many of the potentially eligible municipal corporations or municipal authorities in the Commonwealth of Pennsylvania as it could reasonably contact to apply for grant funding under § 206(a). (U)
70. The DER's contacts with these municipal corporations and municipal authorities were made through the Regional Sanitary Engineers or their staff members for the regions in which those projects were located in the Commonwealth of Pennsylvania, pursuant to guidelines provided by the Harrisburg office of the DER. (U)
71. The DER stated that the various municipal authorities and municipal corporations in the Commonwealth of Pennsylvania, including the WSA, should forward their applications for § 206(a) funds to the DER which, in turn, would forward the applications to the U.S. EPA. (U)
72. On November 17, 1972, Counterclaim Defendant Mark A. Roller telephoned L. Vernon Frye at his home. (U)
73. Neither Mark Roller nor L. Vernon Frye recall the exact words of the telephone conversation of November 17, 1972. (U)
74. In this conversation, Mr. Roller suggested that the WSA apply for a federal grant under § 206(a) for its construction project, Project No. 420486. Mr. Roller suggested that the WSA apply for the § 206(a) grant through DER and stated that DER would forward the application to EPA. Mr. Roller stated that DER would assist WSA in applying for a § 206(a) grant.
75. At the time of the conversation, Mr. Roller did not know if DER would apply for any portion of the § 206(a) grant for WSA's construction project, Project No. 420486, for DER.
76. In the November 17, 1972 telephone conversation, L. Vernon Frye did not inquire whether Mark Roller was authorized to enter a contract.
77. On November 17, 1972, L. Vernon Frye did not inquire as to what approvals were necessary for DER to enter into a contract.
78. Counterclaim Defendant Roller sent L. Vernon Frye, Executive Director of the WSA, the letter dated November 20, 1972. (Exhibit P-2) (U)
79. The letter of November 20, 1972, stated, inter alia, "This is to confirm our telephone call on November 17, 1972" and that "you are urged to promptly apply for funding for which your municipality or authority may be eligible." (U)
80. On the basis of the telephone conversation between Mr. Roller and Mr. Frye and the November 20, 1972 letter of Mr. Roller, the WSA reasonably understood that the § 206(a) payment for its construction project, Project No. 420486, would be paid to the WSA and that DER would assist WSA in obtaining the full section 206(a) grant.
81. On the basis of the conversation between Mr. Roller and Mr. Frye and the November 20, 1972 letter of Mr. Roller, the WSA reasonably understood that DER would assist WSA in obtaining a § 206(a) grant from EPA for WSA.
82. In making the telephone call on November 17, 1972, and in sending the letter dated November 20, 1972, Counterclaim Defendant Roller was acting upon the instructions of his superiors in the DER, Walter Lyon and Daniel Drawbaugh. (U)
83. Walter Lyon and Daniel Drawbaugh had the authority to issue the instructions contained in Exhibit D-48. (U)
84. In response to this conversation and letter, the WSA filed a letter of application for a § 206(a) grant with the U.S. EPA through the DER. (U)
85. The DER forwarded the applications for § 206(a) funds for municipal authorities and municipal corporations in the Commonwealth *1181 of Pennsylvania, including the WSA's application, to the U.S. EPA on October 10, 1973. (Exhibit D-23) (U)
86. In processing the applications for § 206(a) funding, the DER verified the date of the initiation of the applicants' projects for the U.S. EPA. (U)
87. The DER also provided the U.S. EPA with a "reimbursement listing" of Pennsylvania projects qualified for § 206(a) funding. (Exhibit D-23). (U)
88. The DER certified the projects in Pennsylvania for EPA which DER thought eligible for § 206(a) grants.
89. The letter of application was dated November 17, 1972 and signed by L. Vernon Frye for John C. Youngman, Sr., Chairman of the WSA, upon John C. Youngman's express authorization. (Exhibit D-9) (U)
90. The WSA's letter of application for the § 206(a) funds was received by the DER. (U)
91. The instructions from Walter Lyon and Daniel Drawbaugh to Mark Roller contained no authorization for Roller to enter any contract with the WSA.
92. On November 17 and 20, 1972, Mr. Roller did not state that he had any authority to enter a contract on behalf of the DER with the WSA.
93. On November 17 and 20, 1972, Mark Roller made no offer to enter any contract with the WSA.
94. Mr. Roller's letter of November 20, 1972, contains no offer to enter a contract on behalf of the DER with the WSA.
95. On November 17 and 20, 1972, Mr. Roller did not offer to pay the WSA any § 206(a) money.
96. Mr. Roller's letter of November 20, 1972 contains no offer or promise to pay to the WSA any § 206(a) money.
97. At the time of Mark Roller's November 17 and 20, 1972 communications with the WSA, Mark Roller had not identified or secured approval of any state appropriation which would authorize a payment to the WSA.
98. Executive Directive # 95, Plaintiff's Exhibit 10, was promulgated by the Governor of Pennsylvania, Raymond Shafer, on February 4, 1970.
99. Executive Directive # 95 was in effect on November 17 and 20, 1972.
100. Executive Directive # 95 sets forth the approval process for contractual agreements entered by Pennsylvania state agencies under the Governor's jurisdiction for the period 1971-1973.
101. Executive Directive # 95 requires the following approvals for the valid execution of a contractual agreement binding upon Pennsylvania for less than $100,000.00:
(a) The agency head (here the Secretary of DER) must approve all grant award contracts;
(b) The agency attorney is responsible for drafting the contract and must attest to its contents;
(c) The Comptroller's Office must review all contracts entered by state agencies under the Governor's jurisdiction.
102. One of the purposes of Executive Directive # 95 is to insure the availability of state appropriations to pay for contracts entered by the state.
103. Pursuant to Executive Directive # 95, all contracts of any nature for $100,000.00 or more were required to be submitted to the Bureau of Systems Analysis, Office of Administration for approval.
104. "Administrative Directive 95" was not a published agency regulation or otherwise made available to the general public.
105. The permits for the upgrading of the West and Central Plants, which was Project No. 420486, were executed and issued by Counterclaim Defendant Roller on behalf of DER. (Exhibits D-114, D-115).
106. If any agreement was entered into by Mr. Roller on November 17 or 20, 1972, it was not approved by the Comptroller of Pennsylvania. (U)
107. If any agreement was entered into by Mr. Roller on November 17 or 20, 1972, it was not approved by any Commonwealth attorney. (U)
*1182 108. If any agreement was entered into by Mr. Roller on November 17 or 20, 1972, it was not approved by the Pennsylvania Office of Administration, Bureau of Systems Analysis. (U)
109. Any agreement entered into by Mr. Roller on November 17 and 20, 1972, did not have approval by the Bureau of Systems Analysis.
110. The DER did all that Mark Roller told L. Vernon Frye it would do by forwarding the applications of the WSA and other municipalities to the U.S. EPA.
111. By letter dated November 20, 1972, from Walter A. Lyon to Edward Furia, Regional Administrator, U.S. EPA, Pennsylvania itself applied for § 206(a) money. (Exhibit P-12) (U)
112. Because the DER itself applied, there were in effect two competing applications for § 206(a) money for Project No. 420486, that of the DER and that of the WSA.
113. By letter dated September 4, 1973, Marshall Cashman, Chief, Program Services Section, Bureau of Water Quality Management, DER, advised the WSA that "Your sewerage construction project WPC-Pa.-486 meets the requirements for reimbursement funding under § 206(a) of the Federal Water Pollution Control Act Amendments of 1972, Public Law 92-500." Mr. Cashman further advised the WSA that "we are currently processing your letter request for submission to the Regional Administrator by the October 18, 1973 filing date set forth in the Federal Register, Volume 38, No. 122, dated June 26, 1973." (Exhibit P-11) (U)
114. Mr. Cashman's letter of September 4, 1973, contained no language evidencing an agreement by DER to forego any § 206(a) money for which DER itself might be eligible.
115. Mr. Cashman's letter of September 4, 1973, was not approved by the Comptroller of Pennsylvania. (U)
116. Mr. Cashman's letter of September 4, 1973, was not approved by any Commonwealth attorney. (U)
117. Mr. Cashman's letter of September 4, 1973, was not approved by the Pennsylvania Office of Administration, Bureau of Systems Analysis. (U)
118. On or about April 16, 1974, the U.S. EPA approved Project No. 420486 for a grant under § 206(a) in the amount of $220,700.00. (U)
119. Of the $220,700.00 referenced in the last preceding paragraph, $198,600.00 was paid by the U.S. EPA to the DER. (U)
120. The $198,600.00 for Project No. 420486 was paid to and received by the DER on July 10, 1974, along with grant payments based on other projects in one lump sum of $8,948,099.00. (U)
121. The $198,600.00 payment made to the DER represented approximately one-half of the § 206(a) grant for which Project No. 420486 was approved as eligible, the balance not being awarded at that time because of insufficient congressional appropriation. As a result of the insufficient congressional appropriation, the U.S. EPA determined to make grants in the amount of approximately 50% of the eligibility of each of the projects at that time. (U)
122. The WSA was not advised prior to April 1974 that DER was claiming or would claim that DER was entitled to receive payment of the § 206(a) grant for the WSA's Project No. 420486. (U)
123. The DER first advised the WSA that DER considered the grant to be subject to reimbursement or pre-financing under § 206(a), or in any other sense, on April 20, 1974. (U)
124. The first time that the WSA was advised that the § 206(a) grant for Project No. 420486 would be paid to the DER was by the April 23, 1974 letter of Fred Grant of the U.S. EPA sent with the Notice of Reimbursement Action. (U)
125. On the "Multipurpose Wastewater Treatment Reimbursement Action" form used by the U.S. EPA for its grant action with respect to § 206(a) payment for Project No. 420486, Plaintiff's Exhibit 4, the "Williamsport Sanitary Authority" appears in the block entitled "grantee."
*1183 126. The "Multipurpose Wastewater Treatment Reimbursement Action" form further contains the following condition: "In accepting this award of amendment and any payment made pursuant thereto, (1) the undersigned represents that he is duly authorized to act on behalf of the grantee organization ...." (U)
127. The block designated for signature on behalf of the grantee organization on the "Multipurpose Wastewater Treatment Reimbursement Action" form contains the inscription "n/a". (U)
128. A cover letter dated April 23, 1974 (Plaintiff's Exhibit 5), was attached to the "Multipurpose Wastewater Treatment Reimbursement Action" form. It stated, inter alia, "Our records indicate the Commonwealth of Pennsylvania prefinanced a portion of the Federal grant to assure a grant at the applicable percentage level, therefore, reimbursement will be made directly to the Commonwealth." (U)
129. The cover letter and "Multipurpose Wastewater Treatment Reimbursement Action" form were received by the WSA on April 25, 1974. (U)
130. The DER accepted the $198,600.00 received for Project No. 420486 as grantee.
131. The DER did not accept the $198,600.00 for Project No. 420486 on behalf of the WSA.
132. The WSA never authorized DER to accept any payment of any funds or any grant moneys on its behalf. (U)
133. The WSA never acquiesced in the payment of the $198,600.00 of § 206(a) grant for its Project No. 420486 to DER.
134. The U.S. EPA did not designate the DER to receive the $198,600.00 for Project No. 420486 on behalf of the WSA.
135. The WSA waited more than five years after receiving notice that the § 206(a) funds were paid to the DER before asserting claims against DER in any legal action for the funds.
136. The WSA never filed an administrative appeal under 40 C.F.R. § 35.895 demanding payment to it of § 206(a) funds received by the DER.
137. The WSA's first legal action against the DER for the § 206(a) funds was the counterclaim filed in this action on June 6, 1979.
138. The cover letter of April 23, 1974 advised the WSA that if it had any questions or inquiries concerning this matter, it should contact a Mr. E. D. Knott, Pennsylvania Team Leader, Grant Operations Staff, Office of Grants Coordination, of the U.S. EPA. (U)
139. On April 30, 1974, L. Vernon Frye telephoned Mr. Knott and spoke to Mr. Knott concerning the payment of § 206(a) grants to the DER. (U)
140. Mr. Knott advised Mr. Frye to call Marshall Cashman of DER if he questioned the payment of the funds to DER.
141. In his telephone conversation with Mr. Knott, Mr. Frye protested the payment of the § 206(a) grant to DER.
142. Mr. Knott did not tell Mr. Frye of any other procedure or avenue for appealing the payment of the § 206(a) grant to DER.
143. Also on April 30, 1974, L. Vernon Frye telephoned Marshall Cashman, Chief, Program and Board Services Section, Bureau of Sanitary Engineering, DER, to inquire into the payment of the § 206(a) grant to the DER. (U)
144. Mr. Frye was unable to speak to Mr. Cashman and was referred to Mrs. Gertrude Bryson with whom he spoke concerning the payment of the § 206(a) grant to the DER. (U)
145. Mrs. Bryson advised Mr. Frye that DER was claiming the § 206(a) grant for Project No. 420486 because the State Land and Water Conservation and Reclamation Act grant was considered to be pre-financing for the federal funding for WSA's construction Project No. 420486 and that the state grant was subject to reimbursement.
146. In his conversation with Mrs. Bryson, Mr. Frye protested DER's claim to and receipt of the § 206(a) grant for the WSA's construction project and asserted WSA's right to receive the grant payment.
*1184 147. Between April 30, 1974 and December 17, 1974, Mr. Frye wrote four letters to the DER concerning the WSA's position with respect to its entitlement to the § 206(a) funds. (Exhibits D-18, D-19, D-20, and D-21) (U)
148. DER advised WSA to apply to the federal government, not DER, for payment of the $198,600.00 in § 206(a) grant funds for WSA's construction project to DER. (Exhibit 17)
149. WSA attempted to resolve the dispute concerning the entitlement to the § 206(a) grant funds diligently and in good faith.
150. When the WSA was not able to obtain an amicable resolution of its differences with the government agencies involved informally, the WSA filed a civil action against the then administrator of the U.S. EPA, Russell Train, Williamsport Sanitary Authority v. Train, Civil Action No. 75-1377, in the United States District Court for the Middle District of Pennsylvania. (U)
151. Civil Action No. 75-1377 was filed on November 11, 1975 and was assigned to the Honorable R. Dixon Herman of this Court.
152. The WSA sought to recover the entire $441,350.00 § 206(a) grant, including the $198,600.00 paid to DER, for WSA's Project No. 420486 in Williamsport Sanitary Authority v. Train, Civil Action No. 75-1377.
153. Judge Herman issued his decision in Williamsport Sanitary Authority v. Train on February 6, 1979 published at 464 F.Supp. 768 (M.D.Pa.) (U)
154. The DER learned that the WSA had instituted the Williamsport Sanitary Authority v. Train, supra, Civil No. 75-1377, on December 11, 1975, when it received a copy of the complaint filed by the WSA from the U.S. EPA. (U)
155. The DER provided background information to the U.S. EPA in the Williamsport Sanitary Authority v. Train, supra, litigation. (Exhibits D-38, D-39) (U)
156. On May 17, 1979, the DER filed a Petition for Declaratory Judgment in the Commonwealth Court of Pennsylvania which upon removal to this Court became this suit.
157. Counsel properly noticed Williamsport Sanitary Authority v. Train in the initial papers filed with the Clerk of Court with the removal petition.
158. At the time the DER filed its Petition for Declaratory Judgment in Commonwealth Court, the WSA was considering the possibility of and researching the requirements for a suit against the Commonwealth and appropriate officers, to recover the $198,600.00 paid to the DER. (U)
159. The total amount paid to the DER by the U.S. EPA under § 206(a) was $9,225,883.00. (U)
160. The § 206(a) payments were received by the DER in the following amounts on the following dates: $8,948,099.00 received July 10, 1974; $21,900.00 received September 7, 1974; $2,430.00 received January 14, 1975; $8,400.00 received January 16, 1975; $39,770.00 received April 21, 1975; $45,614.00 received October 3, 1975; and $159,670.00 received February 10, 1976. (U)
161. The DER believed it was entitled to § 206(a) funds when it applied for, received, and made disposition of the funds.
162. Project No. 420486 was one of 132 sewerage projects for which the DER received grant payments under § 206(a).
163. Pursuant to Act 443, the DER made grants to municipal authorities and municipalities for those 132 projects in the amount of $35,799,160.00. (U)
164. The total amount paid by the U.S. EPA to municipal authorities and municipalities for the 132 projects for which the DER received some payment under § 206(a) to date totalled $30,636,113.00. (U)
165. Section 206(a) grants for approximately 98 other projects in the Commonwealth of Pennsylvania were paid directly to a municipal authority or municipal corporation. (U)
*1185 166. Payments were made by the U.S. EPA to either the DER or municipalities based on the U.S. EPA's determination as to whether the DER or a municipality was eligible to receive the funding.
167. The DER did not serve as an agent for disbursing § 206(a) money when the U.S. EPA determined that money should be paid to a municipality.
168. When the U.S. EPA determined that a municipality was eligible to receive the § 206(a) payment, such payment was made directly to the municipality by the U.S. EPA.
169. The U.S. EPA and the DER did not enter any agency agreement for administration of the § 206(a) grant program.
170. The DER did not serve as the U.S. EPA's agent in awarding § 206(a) grants.
171. The § 206(a) grants claimed and received by the DER were used to augment the state grant program under Act 443 which benefitted municipalities and municipal authorities.
172. Project No. 420486 is not eligible for payment of additional state funds under Act 443 and the regulations promulgated thereunder at 25 Pa.Code Chapter 103.
173. All checks received by the DER, including checks received for § 206(a) grants, were and are forwarded to the State Treasury Department (Treasury) through the DER's comptroller and the State Department of Revenue.
174. Treasury also receives other checks and monies, including but not limited to tax revenues, proceeds from sales of bonds and fees.
175. Treasury conveys the checks and monies it receives to a bank and the bank credits the amount received to Treasury's bank account.
176. The amounts credited to Treasury's bank account are invested as soon as possible or paid out as necessary.
177. The amounts credited to Treasury's bank account are not credited to any particular source or purpose. (U)
178. The DER itself does not hold any monies from which it can make payments to grantees or vendors.
179. Payments of state grants awarded by the DER are made by means of checks issued by Treasury.
180. To make payments, the DER must forward a requisition to Treasury through DER's comptroller. The approval of the comptroller and the Treasury is required.
181. "Fund 39" is a term used to identify funds credited to the Land and Water Development Fund by the DER and certain other executive agencies. (U)
182. The Land and Water Development Fund was created as a result of the passage of Act 443.
183. The Land and Water Development Fund includes monies received from the sale of bonds and notes, pursuant to Act 443, and federal funds from several sources including all § 206(a) funds.
184. Monies received by the DER under § 206(a) were credited to Restricted Revenue Account 92. (U)
185. Restricted Revenue Account 92 was created in 1971 by administrative action of DER.
186. Restricted Revenue Account 92 is designated Appropriation Symbol 92 by DER's Comptroller and by Pennsylvania's accounting system.
187. A restricted revenue account is an account code which functions as a discrete revenue identifier. The purpose of an account code is to enable the state to identify and restrict the revenue credited to an account. "Restricted Revenue Account 92" is used by the DER for certain federal grants paid to the DER, including § 206(a) grant funds. (U)
188. The characteristics of a restricted revenue account include the following: a restricted revenue account does not require legislative action for its creation; once a restricted revenue account is created, the account continues from year to year without any further action by the governor or the legislature; money credited to a restricted *1186 revenue account is restricted in the purposes for which it can be spent and is restricted in the sources of revenue which can be credited to it.
189. A restricted revenue account is not a bank account. (U)
190. The only funds credited to Restricted Revenue Account 92 are federal grant funds, specifically, funds received under §§ 205(g), 206 and 208 of the Federal Water Pollution Control Act.
191. There is no physical entity known as Fund 39.
192. There is no physical entity known as Restricted Revenue Account 92.
193. Fund 39 and Restricted Revenue Account 92 are names of ledger accounts.
194. The Department of Environmental Resources keeps separate records for all payments credited to and disbursements from Restricted Revenue Account 92.
195. The Office of the Comptroller of DER prepares separate reports for Restricted Revenue Account 92.
196. DER can deduce the ultimate disbursement and expenditure of § 206(a) funds. (U)
197. Restricted Revenue Account 92 is a division of Fund 39. Restricted Revenue Account 92 is separately administered from the rest of Fund 39 by DER in that the funds credited to Restricted Revenue Account 92 are restricted to federal grants, the use to which the restricted revenue funds are to be put is restricted, separate personnel in DER are responsible for the administration of Restricted Revenue Account 92, and separate reports are prepared for Restricted Revenue Account 92 to distinguish funds credited to Restricted Revenue Account 92 from other funds credited to Fund 39.
198. The receipt of federal funds from several sources, including § 206(a), was recorded by the DER under Restricted Revenue Account 92.
199. The § 206(a) funds received by the DER were commingled with other state and federal funds.
200. In its accounting, Treasury concerns itself only with Fund 39 as a whole, not with Restricted Revenue Account 92 or any other part of Fund 39.
201. The individual Counterclaim Defendants do not have physical possession of the § 206(a) grant funds. (U)
202. The individual Counterclaim Defendants did not acquire the § 206(a) funds through execution process. (U)
203. The individual Counterclaim Defendants did not acquire the § 206(a) funds through replevin or any other judicial process similar to execution process.
204. DER can determine the balance of § 206(a) funds carried in Restricted Revenue Account 92 at any time and has determined the balance of the section 206(a) funds in Restricted Revenue Account 92 for purposes of this suit.
205. There is a balance of $3,170,075 of section 206(a) grant funds in Restricted Revenue Account 92 at this time.
206. The DER encumbered $6,055,808.00 of the § 206(a) money it received as grant payments to municipalities and municipal authorities as follows on the indicated dates. (U)
Amount of Date of
Encumbrance Project Encumbrance
$ 20,180.00 State Grant to 9-10-75
Loysville Village
Mun. Auth.
4,708,778.00 State Grant to 9-16-75
Valley Forge Sewer
Auth.
605,280.00 State Grant to Boro 12-4-74
of Ambridge Mun.
Auth.
721,570.00 State Grant to Boro 5-20-76
of Jefferson.
207. The DER expended $5,419,040.00 of the money identified as encumbered in the preceding paragraph on the following dates as indicated below: (U)
Date of
Project payment Amount
Borough of Ambridge 7-30-76 $ 52,080.00
Municipal Authority 1-12-77 175,470.00
Beaver Co., Pa. 5-25-77 143,570.00
11-25-77 159,520.00
3-12-79 74,640.00
*1187
Date of
Project payment Amount
Borough of Jefferson 1-12-77 300,740.00
Allegheny Co., Pa. 3-77-77 (sic) 116,900.00
4-21-77 175,340.00
1-16-78 11,690.00
Loysville Village 12-16-76 3,710.00
Municipal Authority 3-8-77 4,700.00
Perry County, Pa. 8-26-77 4,710.00
Valley Forge Sewer 11-19-75 109,850.00
Authority 12-30-75 239,500.00
Chester Co., Pa. 3-10-76 383,270.00
4-23-76 383,240.00
6-23-76 335,340.00
9-22-76 1,006,000.00
10-21-76 479,070.00
1-27-77 689,330.00
3-31-77 427,780.00
10-18-77 142,590.00
208. The municipalities and municipal authorities identified in the preceding two paragraphs were not eligible for § 206(a) grant payments. (U)
209. $5,334,238 of the encumbrances occurred before filing of the WSA's complaint against the U.S. EPA in Williamsport Sanitary Authority v. Train, Civil No. 75-1377 on November 11, 1975.
210. All of the encumbrances occurred before entry of Judge Herman's decision in Williamsport Sanitary Authority v. Train, 465 F.Supp. 786 (M.D.Pa.1979).
211. The DER anticipated distributing the remaining $3,170,075.00 calculated balance of § 206(a) funds pursuant to Act 443 as grants to municipalities and municipal authorities for planning, design, and construction of sewerage facilities.
212. The $3,170,075 balance of § 206(a) monies has been placed under a miscellaneous encumbrance which will isolate and hold the balance until this Court declares the rights of the parties to the remaining monies in the instant proceedings.
213. A miscellaneous encumbrance is a device which ties up the Restricted Revenue Account 92 funds so that an amount of money equal to the amount of the encumbrance is held by the Treasury.
214. Granting the relief requested by the WSA would disrupt the DER's program plans and budgeting.
215. Granting the relief requested by the WSA would result in less money being available to the DER for new sewage treatment plants needed to abate pollution of the waters of the Commonwealth.
216. If the WSA had filed its claims in court between April 25, 1974 and July 10, 1974, it would have minimized the disruption of the Commonwealth's programs and budget if the WSA had won.
III. Discussion.
The Court will first address DER's claim for declaratory relief, then, to the extent that the issues have not been disposed of in the course of that discussion, will turn to the Sanitary Authority's claims for declaratory relief and ultimately will discuss the Authority's claims for damages and mandatory injunctive relief.
DER seeks a judgment declaring that it was the rightful recipient of the § 206(a) funds and is entitled to retain them. The Court has subject matter jurisdiction over this claim because DER's rights to the monies may depend upon a construction of federal law. To the extent DER's claims are based on state law, those claims are pendent to the federal claim and are also within the subject matter jurisdiction of the Court.
In pertinent part, § 206(a) of the 1972 amendments to the Water Pollution Control Act provides:
Any publicly owned treatment works in a state on which construction was initiated after June 30, 1966, but before July 1, 1972, [which meet certain requirements] shall be reimbursed in a total amount equal to the difference between the amount of Federal financial assistance, if any, received under section [1158] [§ 8 of the Water Pollution Control Act, P.L. 84-660,] for such project and ... 55 per centum of the project cost ....
In Williamsport Sanitary Authority v. Train, 464 F.Supp. 768 (M.D.Pa.1979), an earlier and closely related case by the Authority *1188 and involving a claim against EPA for the same monies, the Honorable R. Dixon Herman of this Court held that § 206(a) is clear on its face and required the EPA to remit the § 206(a) monies to the Sanitary Authority.[1] Judge Herman, however, limited the effect of his ruling to funds still in the possession of the EPA. He did not, therefore, decide who is entitled to approximately $198,000.00 that the EPA had previously paid to DER.
As the Court's opinion accompanying its order No. 1 of June 11, 1980 in this case states, § 206(a) on its face required the funds in question to be paid to the Williamsport Sanitary Authority. While read literally, the section of the amendment requires payments to the treatment works themselves, common sense dictates that the reimbursement be made to the owners of the treatment works, in this case, the Williamsport Sanitary Authority. The reference in § 206(a) to § 8 of the Water Pollution Control Act, 33 U.S.C. § 1158, is a further indication that Congress intended the § 206(a) reimbursement to go to the Authority. Section 8(a) provided for grants to any state, municipality, or intermunicipal agency for the construction of treatment works. In this case, it is undisputed that the § 8 grant went to the Williamsport Sanitary Authority. Therefore, the Sanitary Authority was the entity to be reimbursed a total equal to the difference between what it received under § 8 and 55% of the eligible costs of the project.
Moreover, § 206(b), 32 U.S.C. § 1286(b), specifically provides for reimbursements for state or local funds used in construction of sewer works. That section, however, relates to reimbursement when projects eligible for federal assistance under § 8 did not receive that assistance because of Congress's failure to appropriate necessary funds. Section 206(b) provides reimbursement to the entity, be it the state or local authority, which in fact advanced the federal share of the construction. In this case, it is undisputed that Williamsport Sanitary Authority received the full amount of § 8 funding to which it was entitled prior to the enactment of § 206. Therefore, DER's argument that it pre-financed the § 8 grant is without merit and does not justify its receipt of the § 206(a) funds in dispute.
The Court's opinion accompanying its order No. 1 of June 11, 1980 examined the Committee reports relating to the 1972 amendments and concluded that the Congress intended 206(a) funds to go to local authorities which because of their states' failure to enact certain pollution standards or to provide required matching funds were not eligible for the maximum funding under § 8 while 206(b) money was to go to whichever entity in fact paid what would have been the federal share under § 8 but was not paid by the federal government because of Congress's failure to make appropriations for that purpose. Section 206(a), therefore, operated to bring federal funding for all eligible projects to 55% regardless of the area of the state in which the plant was located. Commonwealth of Pennsylvania v. Williamsport Sanitary Authority, Civil No. 79-690, slip op. at 30-34 (M.D.Pa. June 11, 1980).
The parties have submitted portions of the Congressional Record relating to the 1972 amendments. The Court has reviewed the materials submitted by the parties and finds the statements by members of Congress to be inconclusive as to the issue presented in this case. The Court, therefore, relying on the language of § 206(a), its relationship to § 206(b), and the legislative history set forth in [1972] U.S.Code Cong. & Admin.News, p. 3668 concludes that the payment of the $198,600.00 by the EPA to DER was contrary to § 206(a) and that the money should have been paid to the Williamsport Sanitary Authority.
The Commonwealth argues that even if the Authority was entitled to the § 206(a) funds, the Authority's acceptance of grants under Acts 443 and 339 permitted the Commonwealth to receive the § 206(a) *1189 monies as a form of reimbursement. The Court's opinion accompanying its order No. 1 of June 11, 1980 held that the absence of any language in the grant applications precluding reimbursement was not dispositive. Commonwealth of Pennsylvania v. Williamsport Sanitary Authority, Civil No. 79-690, slip op. at 36-37 (M.D.Pa. June 11, 1980). As the findings of fact indicate, the grants awarded by DER do not contain any reference to pre-financing or otherwise impose an obligation on the Authority to forego any federal funds which might later become available. Title 32 P.S. § 5119, which permits the DER to use available federal funds to augment its grants under Act 443, does not constitute a provision for reimbursement. That section merely provides that if DER is entitled to federal funds, those funds may be used to augment grants under Act 443. Based on the testimony adduced at trial, the Court concludes that when DER awarded the grants under Acts 443 and 339 it did not intend to seek reimbursement from the Sanitary Authority's share of future federal funds which might become available. Moreover, the Williamsport Sanitary Authority never had an intention to forego any federal grant or reimburse the state for any of the latter's grants. Therefore, even if the DER intended to seek reimbursement in that manner, the absence of a meeting of the minds on this point precludes any claim for reimbursement based on the grants under Acts 443 and 339.
DER has argued that the Authority is not entitled to the § 206(a) funds in dispute because DER sought to assure through Acts 339 and 443 that in any fiscal year all local authorities receiving funds for sewage plant construction received the same combined share of federal and state funds. To accomplish this goal those authorities eligible for more federal funds received less in state grants. DER contends that the Authority would enjoy a windfall if it were to receive the § 206(a) funds and thereby have its share of federal and state funding increased over that of other authorities which commenced projects in 1971.
This argument must be rejected. The federal program under § 206(a) required that the federal share for the Authority's project be 55%. The state's laudable intent to equalize funding must give way to the federal law. The Supremacy Clause of the Constitution prevents Pennsylvania from defeating the federal mandate of 55% federal funding by wrongfully receiving and retaining the § 206(a) funds in dispute.
Having determined that the Williamsport Sanitary Authority should have been paid the § 206(a) money in dispute, the question remains whether the Sanitary Authority was entitled to the money as of June 6, 1979, the date its counterclaims were filed. In response to the Sanitary Authority's counterclaims, DER has raised defenses in addition to the Eleventh Amendment. The Court will first consider the other defenses before addressing the Eleventh Amendment issue. In this way, the claims may possibly be disposed of on a non-constitutional basis which is a preferred method of adjudication. The Court will do this even though the Eleventh Amendment goes to the jurisdiction of the Court and ordinarily a jurisdictional issue should be considered first. The Court will postpone discussion of the Eleventh Amendment issue in this case because the Commonwealth as Plaintiff in the declaratory judgment action sought to establish its rights under both federal and state law. If the Sanitary Authority is barred for other reasons from claiming the § 206(a) funds, there would be no need to address the Court's jurisdiction to award relief on the Authority's counterclaims.
In its attempt to prove that the Sanitary Authority has no claim for the § 206(a) money paid to DER, DER offered evidence relating to an alleged contract between DER and the Authority which the Authority claims arose as the result of a telephone conversation between counterclaim Defendant Roller and Vernon Frye, the General Manager of the Authority. The parties have addressed in depth the question whether the appropriate statute of limitations is six years for a written contract as provided in 42 Pa.C.S.A. § 5527(2), *1190 four years for an express oral contract under 42 Pa.C.S.A. § 5525(3), as extended to June 27, 1979 by Act of July 9, 1976, P.L. 586, No. 142 § 2, Appendix Title 42, 6 months for contract claims against the Commonwealth under 72 P.S. § 4651-6, or two years for the recovery of property in the possession of any Commonwealth officer pursuant to 42 Pa.C.S.A. § 5524(6). The Court in its opinion accompanying order No. 1 of June 11, 1980 indicated that the two-year limitation of § 5524(6) is not applicable because that section relates to funds in the possession of a government officer or entity by reason of execution or similar process. The parties were directed to submit the legislative history of that section but neither located any. Consequently, the Court shall make final its determination that § 5524(6) is inapplicable because the funds in question were not in the possession of the counterclaim defendants by reason of execution or similar process.
The Court need not resolve the dispute over which statute of limitations is applicable. Based on the testimony at trial, the Court concludes that there was no evidence whatsoever of any contract between DER or any of the counterclaim Defendants on the one hand and the Authority on the other obligating DER to pay the § 206(a) funds to the Authority.
In both the telephone conversation between Roller and Frye and Roller's letter confirming that conversation, DER did not offer to pay any money to the Authority. DER advised the Authority of the availability of funds under § 206(a) and urged the Authority promptly to apply for funds to which it might be entitled. DER offered to assist the Authority, which it did, by forwarding the application to EPA and by providing the required back-up information. Neither Roller nor Frye at the time of the telephone conversation or letter believed that DER was obligating itself to pay any § 206(a) money to the Authority. Moreover, Roller did not have the authority to make such an agreement. Consequently, the Authority's claim for the § 206(a) funds does not rest on any contract theory be it express, implied in fact, or implied in law.
After hearing all of the evidence in the case and reviewing the undisputed facts, the Court concludes that the Sanitary Authority's claim for the § 206(a) funds is, as it suggest in its trial brief, a claim for the taking of personal property or for money had and received. Federal law, § 206(a), established the Authority's right to the funds. DER, therefore, wrongfully received the money and the Authority has a valid claim against DER in the nature of conversion. That claim was governed by the six-year statute of limitations, Act of March 27, 1713, 1 Sm.L. 76, codified at 12 P.S. § 31 repealed by Act of April 28, 1978, P.L. 202, No. 53, § 2(a), and could have been brought within six years of the date the claim arose which was July 12, 1974, the day DER received the § 206(a) money. The applicable statute of limitations under Title 42 of the Pennsylvania Consolidated Statutes is either the two-year limitation at 42 Pa.C.S.A. § 5524(3) relating to an action for taking personal property, including claims for specific recovery, or the six-year limitation at 42 Pa.C.S.A. § 5527(6) for any civil action which is not subject to another limitation period specified in Title 42. In either event, § 2 of the Appendix, Act of July 9, 1976, P.L. 586, No. 142, gave the Authority one year from June 27, 1978, the effective date of Title 42, in which to assert its claims. Therefore, at the time the Commonwealth filed its petition for declaratory judgment and at the time the Authority asserted its counterclaims, the Authority's claim for the money was not time barred. Since the Court has concluded that the Authority should have been paid the § 206(a) money and since its claim for the money was not time barred, the Court cannot enter the declaratory judgment sought by the Commonwealth but rather must enter a judgment declaring the Authority's right to the section 206(a) money unless such a declaration is barred by the Eleventh Amendment.
Although the Court has determined that the Sanitary Authority has a theory under state law which if not barred by the Eleventh *1191 Amendment would provide it with full relief, in view of the extensive briefing done on the question of federal claims for relief, the Court will address those issues as well.
DER argues that assuming that the Authority has a claim under Federal law, it is barred because the Authority did not pursue the administrative remedy provided at 40 C.F.R. § 35.895 which, if applicable, requires an administrative appeal within 30 days of the date of a Regional Administrator's order. The Court concluded in its opinion accompanying order No. 1 of June 11, 1980 that on the basis of the record then before it 40 C.F.R. § 35.895 was not applicable to this case. Commonwealth of Pennsylvania v. Williamsport Sanitary Authority, Civil No. 79-690, slip op. at 9-11 (M.D.Pa. June 11, 1980). After hearing testimony on the issue and considering the additional briefing of the parties, the Court adheres to that conclusion.
Title 40 C.F.R. § 35.895 governs administrative appeals when there is a question as to the eligibility of an applicant for federal financial assistance, the amount to which it is entitled, or the allowability of costs. In this case, there is no dispute that the Williamsport Sanitary Authority was eligible to receive funds under § 206(a) in the sense that its project had not received 55% federal funding under § 8. In addition, there is no dispute as to the amount to be awarded for the Sanitary Authority's project. Neither is there any dispute as to the allowability of costs. What is in dispute is to whom the money was to have been paid. The EPA determined that although the Authority was eligible for the monies in question, that money would be paid to the state because the EPA concluded that the state had "prefinanced" a portion of federal share.
While it is possible to stretch the language of § 35.895 to cover this case, it is the Court's view that the EPA did not intend its regulation to be so construed. This is evidenced by the fact that in notifying the Authority that its money would be paid to DER, EPA did not inform the Authority of its rights under 40 C.F.R. § 35.895. Rather, EPA instructed the Authority to contact one of its own employees if the Authority had any questions. If EPA, which promulgated the regulation considered it applicable, it would probably have brought the regulation to the Authority's attention when it announced its intention to pay the money to DER. Moreover, 40 C.F.R. § 35.895 relates to disputes with the EPA. It was not promulgated to limit the rights of unsuccessful applicants to sue parties other than EPA if such suits are otherwise permitted. The Authority's claim, therefore, is not barred because of its failure to exhaust administrative remedies.
Turning now to a determination of the parties' respective rights under federal law, the Court must first determine whether to imply a cause of action in favor of the Authority under § 206(a). The Authority argues that no cause of action for damages can be implied from § 206(a) but contends that equitable relief is available. "The question whether a statute creates a cause of action, either expressly or by implication, is basically a matter of statutory construction." Transamerica Mortgage Advisors v. Lewis, 444 U.S. 11, 15, 100 S.Ct. 242, 245, 62 L.Ed.2d 146 (1979).
In Cort v. Ash, 422 U.S. 66, 78, 95 S.Ct. 2080, 2087, 45 L.Ed.2d 26 (1975), the Supreme Court set forth four relevant factors to consider in determining whether to imply a private cause of action from a federal statute. First, whether the plaintiff is one of a class for whose special benefit the statute was enacted; second, any indication of legislative intent; third, consistency with the underlying purposes of the legislation; and fourth, whether the cause of action is one traditionally relegated to state law so that it would be inappropriate to infer a cause of action based solely on federal law. In Touche Ross & Co. v. Redington, 442 U.S. 560, 575-76, 99 S.Ct. 2479, 2488-89, 61 L.Ed.2d 82 (1979), the Supreme Court, in explaining Cort v. Ash, stated that the four factors are not entitled to equal weight. The central inquiry is whether Congress intended to create a private cause of action. See Micklus v. Carlson, *1192 632 F.2d 227, 235 (3d Cir. 1980).
Turning first to the statutory language, § 206(a) states only who is entitled to reimbursement. To that extent, it was passed for the special benefit of a class a member of which is the Authority. The facts that § 206(a) was designed to benefit the Authority and that it has been harmed by a violation of § 206(a) do not require the implication of a private action on its behalf. See Touche Ross & Co. v. Redington, 442 U.S. 560, 578, 99 S.Ct. 2479, 2490, 61 L.Ed.2d 82 (1979); Cannon v. University of Chicago, 441 U.S. 677, 688, 99 S.Ct. 1946, 1953, 60 L.Ed.2d 560 (1979). Section 206 does not in any way impose liability on anyone or address the responsibilities of anyone other than the Administrator of the Environmental Protection Agency.
Turning to the second factor identified in Cort, the legislative history accompanying § 206 yields no information concerning the possibility of private rights of action against entities who improperly received § 206(a) funds.
Looking at other sections of the Water Pollution Control Act to determine if a private cause of action is consistent with the underlying purposes of the statute, 33 U.S.C. § 1365(a)(2) provides for a civil action against the administrator of the EPA where "there is alleged a failure of the Administrator to perform any act or duty under this chapter which is not discretionary with the Administrator." This section shows that Congress contemplated a cause of action against the Administrator in certain circumstances. Section 206 imposes a non-discretionary duty upon the Administrator to reimburse eligible applicants. Had the Authority taken advantage of the right of action provided in § 1365 before the EPA paid the money to the state, the Authority would not be in the position it is now; attempting to recover the money from DER.
"[I]t is an elemental canon of statutory construction that where a statute expressly provides a particular remedy or remedies, a court must be chary of reading others into it. `When a statute limits a thing to be done in a particular mode, it includes the negative of any other mode.'" Transamerica Mortgage Advisors v. Lewis, 444 U.S. 11, 19-20, 100 S.Ct. 242, 247, 62 L.Ed.2d 146 (1979) (citation omitted). Congress provided for a judicial remedy to prevent the particular harm suffered by the Authority. While admittedly the Authority did not have an abundance of time in which to pursue its remedy, it did have from April 1974, when it learned that EPA was going to pay DER, until July 1974, when the first payment was made to DER, to commence an action against the EPA to prevent payment of the funds to DER. Although EPA and DER told the Authority that it should petition the other for redress, neither did anything which prevented in any way an action by the Authority against the Administrator as contemplated by 33 U.S.C. § 1365(a)(2). "In view of [the] express [provision] for enforcing the duties imposed by [§ 206], it is highly improbable that `Congress absentmindedly forgot to mention an intended private action.'" Transamerica Mortgage Advisors v. Lewis, 444 U.S. at 20, 100 S.Ct. at 247 (citation omitted). Therefore, the Court concludes that a private cause of action against the recipient of § 206(a) funds is not consistent with the purposes of the Water Pollution Control Act which limited private actions to those against the Administrator.
Moreover, the recovery of money wrongfully paid has traditionally been a concern of state law. A claim for conversion or for money had and received provides a plaintiff with an adequate remedy. There is, therefore, no reason to assume Congress intended to create a duplicative federal cause of action.
Looking at the four factors delineated in Cort and heeding the Supreme Court's admonishment that a private cause of action is to be implied only if Congress so intended, the Court concludes that Congress did not intend to create a private cause of action in favor of the Authority against DER.
*1193 The Authority argues that even though it has no right of action for damages under § 206(a), the Court may imply an equitable claim. The Authority argues that a different analysis is to be used when equitable claims are asserted. The Court must reject this argument in light of the Supreme Court's decision in Transmerica Mortgage Advisors. In that case, the Court considered whether §§ 206 and 215 of the Investment Advisors Act of 1940 created implied legal or equitable causes of action. After a review of the statutory language and legislative history, the Court concluded that § 215, which declared certain contracts void, implied a private cause of action for rescission of such contracts or to enjoin their enforcements. Transamerica Mortgage Advisors v. Lewis, 444 U.S. at 19, 100 S.Ct. at 247. The Court also determined that no legal or equitable claim could be implied from § 206 which made unlawful certain activities. Transamerica Mortgage Advisors v. Lewis, 444 U.S. at 24, 100 S.Ct. at 249. The Court embarked on no different type of analysis in reaching the conclusion with respect to equitable remedies.
The type of injunctive relief sought by the Authority is another reason why a private cause of action in its favor cannot be implied from § 206(a). The equitable remedies sought by the Authority are indistinguishable for all practical purposes from its claims for damages. All seek payment of approximately $198,000.00 representing the amount of the § 206(a) funds paid by EPA to DER. Whether that relief is ordered in the form of damages or in the form of an injunction directing that the money be paid is immaterial. The Court, therefore, need not decide whether a claim for equitable relief seeking to enjoin the DER from accepting future § 206(a) money may be implied from § 206. The Authority cannot by attaching the label of injunctive relief change the nature of is claims which are in essence for damages.
The cases cited by the Authority in support of its argument that the Court may grant it equitable relief are inapposite. Each of those cases involved situations where the plaintiffs' complaints stated a claim for relief under either federal or state law and the question involved was whether the federal court should exercise its equitable powers. That situation is not present here because the Authority does not have a claim for relief under Federal law. Moreover, the equitable relief ordered in each of the cases cited by the Authority enjoined the Defendants from acting contrary to the law in the future. In this case, the only equitable relief sought by the Authority is in the nature of an order directing DER to pay the § 206(a) money. Consequently, the Court concludes that § 206 does not provide the Authority with any equitable claim to recover § 206(a) money from DER. Since the Authority has no equitable claims, the Court need not determine if they are barred by laches.
Having determined that the Sanitary Authority was entitled to the § 206(a) funds and that the money was improperly paid to DER, the Court must now determine what relief it is able to grant the Authority. In its counterclaims, the Authority requests payment of the $198,600.00 under theories of breach of contract, constructive trust, and mandatory injunctive relief. As indicated above, the Authority has no contract claims against DER. The Court must decide whether it may consistently with the Eleventh Amendment award the $198,600.00 to the Authority under any of the remaining theories.
The Eleventh Amendment provides:
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.
The Eleventh Amendment has long been extended to prohibit suits against a state by her own citizens. Edelman v. Jordan, 415 U.S. 651, 663, 94 S.Ct. 1347, 1355, 39 L.Ed.2d 662 (1974); Hans v. Louisiana, 134 U.S. 1, 10 S.Ct. 504, 33 L.Ed. 842 (1890). The Court's opinion of January 21, 1980, held that the Authority's status under Pennsylvania law did not prevent the Defendants *1194 from raising the Eleventh Amendment as a bar to the Court's jurisdiction.
The Eleventh Amendment bars an action by a private party seeking to impose a liability which must be paid from public funds in the state treasury. Edelman v. Jordan, 415 U.S. 651, 663, 94 S.Ct. 1347, 1355, 39 L.Ed.2d 662 (1974). It matters not what label is attached to the award. If the award must inevitably come from the general revenues of the Commonwealth it is barred by the Eleventh Amendment. Edelman v. Jordan, 415 U.S. at 665, 94 S.Ct. at 1356. If, however, the award takes the form of prospective relief, requiring the counterclaim Defendants to conform future conduct to federal law, then the award is not prohibited. Quern v. Jordan, 440 U.S. 332, 337, 99 S.Ct. 1139, 1143, 59 L.Ed.2d 358 (1979).
In this case, an award of moneys would be retrospective relief to compensate the Authority for DER's wrongful retention of the § 206 funds. It is undisputed that there will be no future funds appropriated under § 206(a) to which the Authority is entitled. Therefore, the Court cannot issue an injunction requiring DER to pay future awards from the EPA to the Authority. The relief sought by the Authority would compensate it for DER's past conduct which is now determined to have been unlawful. See Edelman v. Jordan, 415 U.S. at 668, 94 S.Ct. at 1358.
Even though an award in this case would be in the nature of compensation for past injury, such an award is not prohibited by the Eleventh Amendment unless it would require the payment of state funds. The Authority asserts that since DER keeps separate bookkeeping records showing its expenditure of § 206(a) funds, an award by this Court could be satisfied from federal funds, not state funds. The fallacy of this argument is that it substitutes the illusion of bookkeeping for the reality of what happened to the money EPA paid to Pennsylvania.
The $198,600.00 in dispute in this case was included in a check to Pennsylvania in an amount of approximately $9,000,000.00 which was delivered in July 1974. The check was deposited to the credit of the Commonwealth in a Philadelphia bank. It was carried on the Commonwealth's books in its Fund 39 until it was withdrawn and used to purchase commercial paper. Once the commercial paper matured, the proceeds thereof were again credited to Fund 39 and shortly thereafter disbursed. At no time did Pennsylvania segregate the § 206(a) funds from other revenues. Moreover, the Commonwealth was able to draw checks on the money so long as it remained in its demand deposit account. Any judgment directing payment of an amount in excess of $198,000.00 would be satisfied from funds available to the Commonwealth of Pennsylvania. It is immaterial whether DER would in accounting for that disbursement charge its Appropriation Symbol 92. DER's bookkeeping has no relation to the movement of funds in the Commonwealth's fiscal system. DER's books may show authorization to spend sums of money in excess of the amount of cash available to the Commonwealth. Without cash available, the Treasurer will not issue any checks.
It was also developed at trial that the payment of $198,600.00 would have a direct impact on the fisc of the Commonwealth. Pennsylvania has used the § 206(a) money to supplement funds it has available for the construction of new sewage treatment plants. An award of $198,600.00 to the Authority would upset DER's allocation of those funds. It is this type of disruption the Eleventh Amendment forbids. See Edelman v. Jordan, 415 U.S. 651, 666 n.11, 94 S.Ct. at 1357 n.11 (1974).
The Authority makes much of the fact that the § 206(a) money was paid by the federal government rather than collected by the Commonwealth in the form of taxes. This fact, however, is not material. In Edelman v. Jordan, the District Court had awarded retroactive benefits to public aid recipients from an Illinois program funded in part by federal funds. There is no discussion in Edelman indicating that the initial source of the money used to satisfy the award is relevant. The Supreme Court concluded *1195 that any award of retroactive benefits by a federal court is barred by the Eleventh Amendment.
The Authority attempts to limit the reach of Edelman by arguing that the only state funds it is concerned with are those derived from state tax revenues. Such a limited reading of Edelman is not warranted by the case. At no point does the Court define "state funds" in such a restricted manner. Nor would it be consistent with the reasoning of Edelman to have done so. Edelman clearly establishes the principle that the power of a federal court does not extend to directing a state to pay a money judgment for past conduct found to be unlawful. Any funds which a state uses to pay such a judgment are state funds for the purposes of the Eleventh Amendment if those funds would otherwise be available to the state to be used as it pleases. The facts in this case indicate that from the moment the check from EPA was received by Pennsylvania it was treated similarly to all other revenue received. The payment of $198,600.00 would of necessity leave the Commonwealth with $198,600.00 less than if the payment were not made. The effect on Pennsylvania would be the same regardless of the label attached to the relief. For Eleventh Amendment purposes, there is no distinction between damages, imposition of a constructive trust or injunctive relief requiring Pennsylvania to pay the Authority $198,600.00. See Edelman v. Jordan, 415 U.S. 651, 666, 94 S.Ct. 1347, 1357, 39 L.Ed.2d 662 (1974).
The Court's opinion of January 21, 1980 rejected the Authority's argument that DER waived its Eleventh Amendment protection because it commenced this action in state court or because of its cooperation with EPA in the Train action or because of its participation in the federal pollution control program. Commonwealth of Pennsylvania v. Williamsport Sanitary Authority, Civil No. 79-690, slip op. at 5-9 (M.D.Pa. January 21, 1980). The Authority was unable to prove that DER acted as EPA's agent in administering the § 206(a) program. The Court, therefore, need not consider what effect, if any, DER's status as EPA's agent would have on DER's right to assert the Eleventh Amendment as a bar to the Authority's claims.
This case is also distinguishable on its facts from the cases of Schiff v. Williams, 519 F.2d 257 (5th Cir. 1975), and Bowen v. Hackett, 387 F.Supp. 1212 (D.R.I.1975). Schiff involved the question whether a judgment against a state university for back pay to the plaintiffs who were wrongfully discharged from their positions as editors of the student paper was barred by the Eleventh Amendment. In that case, the Court of Appeals found that the judgment would be paid from a fund generated by student activities fees which were collected for the purposes of operating the newspaper, including paying the salaries of the editors. In addition, the fund did not come into the possession of the state until after the lawsuit in question was commenced.
Bowen involved a claim against two employment security funds mandated by Rhode Island law but administered separately from the state treasury. The funds were at all times segregated from the general revenues and Rhode Island had not pledged its credit to maintain the solvency of the funds.
In the related case of Municipal Authority of Bloomsburg v. Pennsylvania, 496 F.Supp. 686, (M.D.Pa. 1980), the Court in denying Pennsylvania's motion to dismiss held that the Plaintiffs' claims would not be barred by the Eleventh Amendment if they could prove that the § 206(a) money was paid with the understanding that it would be distributed to the Plaintiffs and that it was maintained separately from other state funds. The federal government placed no restrictions on the uses recipients could make of the money. It was paid to reimburse them for past expenses. The fact that the money was improperly paid to DER may impose an implied duty on DER to pay the money to the Authority thereby meeting the first branch of the test set forth in Bloomsburg. The Authority, however, was not able to meet its burden with respect to the second branch because the *1196 money paid pursuant to § 206 was not maintained separately from other state funds. The fact that an influx of money from the federal government permits Pennsylvania to spend more on its sewage treatment program than it otherwise could have done does not make the additional amount available federal rather than state funds. The Commonwealth at all times has treated the proceeds of the check from EPA as available for meeting the cash needs of the Commonwealth. The fact that DER kept track of its expenditures in a way to show it when it had spent an amount equal to the § 206(a) funds does not alter the fact that at all times the cash was available and used by the Commonwealth for its day to day needs. In short, there is no fund of § 206(a) moneys from which to satisfy a judgment. The Eleventh Amendment, therefore, prevents this Court from ordering the payment of the $198,600.00 to the Authority under any of the theories put forth by the Authority.
DER contends that the Eleventh Amendment also prevents the Court from granting declaratory relief. A judgment declaring the respective rights of the parties will not in and of itself require the Commonwealth to do anything. Like the notice approved in Quern v. Jordan, 440 U.S. 332, 99 S.Ct. 1139, 59 L.Ed.2d 358 (1979), which informed members of the Plaintiff class of available state administrative procedures through which to determine whether they were eligible for past benefits, declaratory judgment in this case would not by itself require Pennsylvania to pay any money to the Authority. In order for that to occur, the Authority must first decide to seek payment from Pennsylvania in state court. Next, the state court must determine whether to order payment to the Authority. The federal court plays no role in either determination. Whether the Authority will receive its money "rests entirely with the State, its agencies, courts, and legislature, not with the federal court." Quern v. Jordan, 440 U.S. 332, 348, 99 S.Ct. 1139, 1149, 59 L.Ed.2d 358 (1979). The Eleventh Amendment, therefore, does not prevent the Court from awarding declaratory relief.
IV. Conclusions of Law.
1. The Court has subject matter jurisdiction over the claims for declaratory relief.
2. The Court lacks subject matter jurisdiction over the Authority's counterclaims seeking payment of $198,600.00.
3. There was no contract between DER and the Authority for the payment of the § 206(a) funds.
4. There is no private cause of action created by § 206(a) of the 1972 Amendments to the Water Pollution Control Act available to the Authority against DER for payment of the § 206(a) money in dispute.
5. The Authority is entitled to a judgment declaring that it was the proper recipient of $198,600.00 in § 206(a) funds and that DER improperly received and retained those funds.
6. The Authority is entitled to a judgment declaring that neither Act 443 nor Act 339 authorized DER to receive or retain the § 206(a) funds.
7. The Authority's requests for an injunction enjoining violations of the Pennsylvania Land and Water Conservation and Reclamation Act, 32 P.S. §§ 5101 et seq. and Water Pollution Control Act Amendments of 1972, 33 U.S.C. §§ 1251 et seq. will be dismissed because there is no probability of future conduct in violation of those acts.
An appropriate order will be entered.
JUDGMENT
This action came on for trial before the Court, Honorable Malcolm Muir presiding, and the issues having been duly tried and in accordance with the Order of Court entered this date,
IT IS ORDERED AND ADJUDGED that:
1. The Williamsport Sanitary Authority was the proper recipient of $198,600.00 of funds authorized by § 206(a) of the 1972 Amendments of the Water Pollution Control *1197 Act, 33 U.S.C. § 1286(a) and the Commonwealth of Pennsylvania, Department of Environmental Resources, acted unlawfully in the receipt and retention of that money.
2. Neither the Pennsylvania Land and Water Conservation and Reclamation Act, 32 P.S. §§ 5101 et seq., nor Act 339, 35 P.S. §§ 701 et seq. authorized DER's receipt and retention of the § 206(a) funds.
3. DER's claims for declaratory relief are dismissed.
4. The remaining claims of the Williamsport Sanitary Authority are dismissed.
NOTES
[1] This case should have been assigned by the Clerk's Office to Judge Herman because it is closely intertwined with WSA v. Train, previously assigned to and disposed of by him. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920081/ | 91 B.R. 616 (1988)
STORAGE EQUITIES, INC., PS Partners III, and Storage Equities/PS Partners, III Gould Drive, Appellants,
v.
Richard Allen DELISLE, Appellee.
Civ. A. No. 1:88-CV-494-JOF.
United States District Court, N.D. Georgia, Atlanta Division.
September 8, 1988.
*617 Barbara J. Lukes, O'Callaghan, Saunders & Stumm, Atlanta, Ga., for appellants.
Frank W. Scroggins, Atlanta, Ga., for appellee.
ORDER
FORRESTER, District Judge.
This matter is before the court on plaintiffs/appellants' appeal of the bankruptcy court's January 5, 1988 order denying their motion to transfer. For the reasons set forth below, the court concludes that the bankruptcy court's order denying plaintiffs' motion should be affirmed.
I. HISTORY OF THE CASE.
The underlying Chapter 7 bankruptcy petition was filed June 1, 1987 in the United States Bankruptcy Court for the Northern District of Georgia, Atlanta Division. On August 26, 1987, plaintiffs commenced this adversary proceeding by the filing of their complaint to determine dischargeability of debt and debtor, to lift automatic stay and for damages. The motion to transfer venue to the Western District of Louisiana, Shreveport Division, was filed September 23, 1987. A hearing on plaintiffs' motion was conducted September 24, 1987.[1] By order entered January 5, 1988, the bankruptcy court, after entering extensive findings of fact and conclusions of law, denied plaintiff's motion to transfer. Notice of appeal was timely filed January 13, 1988.[2]
Two issues are presented by this appeal: (1) whether the bankruptcy court had authority to issue a final order regarding a motion to transfer venue, and, if so (2) whether the bankruptcy court's denial of plaintiff's motion to transfer venue was clearly erroneous.
II. WHETHER A BANKRUPTCY COURT HAS AUTHORITY TO ISSUE A FINAL ORDER REGARDING TRANSFER.
As a preliminary matter, the court notes that plaintiffs stop just short of conceding that the bankruptcy court was acting within its authority in issuing the final order from which this appeal is taken. Less than one full page of plaintiff's brief is dedicated to this issue and no argument is made whatsoever that the bankruptcy court exceeded its authority in issuing the order. Nevertheless, as the question of the validity of the order itself could conceivably render moot the question of whether the underlying motion to transfer was correctly decided, the court will address the issue.
Consideration of this issue starts with the language of 28 U.S.C. § 1412. This statute provides, "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." As noted by the bankruptcy court, a literal reading of section 1412[3] indicates that a bankruptcy court lacks jurisdiction to hear a change of venue motion "in that the power under that section is given to the district court." Order of January 5, 1988 at 4. Thus, the question becomes whether the issue of transfer is one which may constitutionally be referred to the bankruptcy court for hearing and final disposition.
As is well known by now, the Supreme Court in Northern Pipeline Co. v. Marathon Pipe Line Co., 458 U.S. 50, 102 S.Ct. 2858, 73 L.Ed.2d 598 (1981), concluded that the Bankruptcy Act of 1978's broad grant of jurisdiction to the bankruptcy courts over all "civil proceedings arising under Title 11 or arising in or related to cases under Title 11"[4] was unconstitutional. *618 The Court held, "[T]he Bankruptcy Act of 1978 has impermissibly removed most, if not all, of `the essential attributes of the judicial power' from the Article III district court, and has vested those attributes in a non Article III adjunct. Such a grant of jurisdiction cannot be sustained as an exercise of Congress' power to create adjuncts to Article III courts." Northern Pipeline Co. at 87, 102 S.Ct. at 2880. Congress' response to this decision was the "Bankruptcy Amendments And Federal Judgeship Act of 1984," 28 U.S.C. § 151 et seq., which provides in relevant part
(a) Each district court may[5] provide that any or all cases under Title 11 and any or all proceedings arising under Title 11 or arising in or related to a case under Title 11 shall be referred to the bankruptcy judges for the district.
(b)(1) Bankruptcy judges may hear and determine all cases under Title 11 and all core proceedings arising under Title 11, or arising in a case under Title 11, referred under subsection (a) of this section, and may enter appropriate orders and judgments, subject to review under section 158 of this title.
. . . . .
(c)(1) A bankruptcy judge may hear a proceeding that is not a core proceeding but that is otherwise related to a case under Title 11. In such proceeding, the bankruptcy judge shall submit proposed findings of fact and conclusions of law to the district court, and any final order or judgment shall be entered by the district judge after considering the bankruptcy judge's proposed findings and conclusions and after reviewing de novo those matters to which any party has timely and specifically objected.
28 U.S.C. § 157. A bankruptcy court may therefore hear and finally decide all core proceedings, subject to district court review. On the other hand, noncore proceedings may be heard by the bankruptcy court which would then submit its proposed findings of fact and conclusions of law to the district court for final disposition. This scheme, patterned after the Northern Pipeline decision, has consistently withstood constitutional challenges. See In re Earle Industries, Inc., 71 B.R. 919 (Bankr. E.D.Pa.1987); In re Chase & Sanborn Corp., 51 B.R. 733 (Bankr.S.D.Fla.1985); In re Northwest Cinema Corp., 49 B.R. 479 (Bankr.E.D.Minn.1985); In re Production Steel, Inc., 48 B.R. 841 (W.D.Tenn. 1985).
The question now becomes whether a motion to transfer is a core proceeding which a bankruptcy court may therefore constitutionally hear and finally decide. In the case at bar, the bankruptcy court concluded that "the issue of transfer of venue is a proceeding within the meaning of 28 U.S.C. § 157(a) because it is a matter `concerning the administration of the estate' under section 157(b)(2)(A) and (O) and is thus a core matter." Id. at 5. The court agrees. Consideration of such a motion involves "fundamental bankruptcy issues." In Re Finley, 62 B.R. 361, 365 (Bankr.N.D. Ga.1986). These issues include (1) the proximity of creditors of every kind to the court; (2) the proximity of the bankrupt (debtor) to the court; (3) the proximity of the witnesses necessary to the administration of the estate; (4) the location of the assets of the estate; (5) the economic administration of the estate; and (6) the necessity for ancillary administration if bankruptcy should result. Matter of Commonwealth Oil Refining Company, Inc., 596 F.2d 1239, 1247 (5th Cir.1979). In addition, "the most important consideration is whether the requested transfer would promote the economic and efficient administration of the estate." Id. As previously noted, "matters concerning the administration of the estate" are core proceedings on which a bankruptcy court may constitutionally issue a final order.[6] 28 U.S.C. § 157(b)(2)(A).
*619 Though the authorities are split, the majority of courts considering the issue have likewise found motions to transfer under 28 U.S.C. § 1412 to be core matters concerning the administration of the estate. See In re F/S Airlease II, Inc., 67 B.R. 428 (Bankr.W.D.Pa.1986); In re Thomasson, 60 B.R. 629 (Bankr.M.D.Tenn.1986); In re Leonard, 55 B.R. 106 (Bankr.D.D.C.1985); In re Oceanquest Feeder Service, Inc., 56 B.R. 715 (Bankr.D.Conn.1986); In re Waits, 70 B.R. 591 (Bankr.S.D.N.Y.1987); In re 19101 Corp., 74 B.R. 34 (Bankr.D.R.I. 1987); In re Ofia Realty Corp., 74 B.R. 574 (Bankr.S.D.N.Y.1987); In re Whilden, 67 B.R. 40 (Bankr.M.D.Fla.1986); In re Finley, 62 B.R. 361 (Bankr.N.D.Ga.1986).
Further support for the conclusion that issues of venue are core proceedings on which the bankruptcy court may enter final orders is found in the recent amendments to the bankruptcy rules. Bankr.Rule 9027(e), amended effective August 1, 1987, provides that "a motion for remand shall be heard by a bankruptcy judge, who shall file a report and recommendation for disposition of the motion." Similarly, Bankr. Rule 5011(b), also amended effective August 1, 1987, provides that "a motion for abstention pursuant to 28 U.S.C. § 1334(c) shall be heard by the bankruptcy judge, who shall file a report and recommendation for disposition of the motion." In contrast, Bankr.Rule 7087, like Rules 9027 and 5011, amended effective August 1, 1987, provides "on motion and after a hearing, the court may transfer an adversary proceeding or any part thereof to another district pursuant to 28 U.S.C. § 1412, except as provided in [Bankr.] Rule 7019(2)."[7] As noted by the bankruptcy court, the transfer rule does not contain the "report and recommendation" language found in the abstention and remand rules. The court finds this significant and declines to read into Rule 7087 a restriction which is not apparent from the text of the rule itself. Accordingly, the court concludes that the issue of a transfer is a core proceeding on which the bankruptcy court may properly enter a final order.
III. WHETHER THE BANKRUPTCY COURT'S DENIAL OF PLAINTIFFS' MOTION TO TRANSFER WAS CLEARLY ERRONEOUS.
Having determined that the bankruptcy court acted within its authority in issuing the final order from which this appeal is taken, the court now turns its attention to whether the bankruptcy court's denial of plaintiffs' motion was clearly erroneous.
In considering the change of venue sought by plaintiffs, the bankruptcy court correctly considered the factors enumerated above. In so doing, the bankruptcy court determined that the proximity of the creditors to the court would not be enhanced by a transfer because plaintiffs are residents of California and no other creditors would be affected by the transfer. The debtor is a Georgia resident, so forcing him to litigate in Louisiana would impose an obvious hardship. With respect to proximity of the witnesses, the bankruptcy court noted that while some witnesses may have to come from Louisiana, plaintiffs have failed to demonstrate any particular hardship on the part of any of the potential witnesses, and that only plaintiffs would be benefited by the proposed change of venue. Regarding assets, the bankruptcy court relied upon the trustees' conclusion that there were no assets in which the debtor had enough equity to be considered part of the estate, in Louisiana or elsewhere. Thus, the court correctly concluded that the location of assets was irrelevant. Finally, given that the administration of the estate had been concluded, that factor was also properly deemed irrelevant. The court *620 thus determined that plaintiffs had failed to demonstrate that the case should be transferred and denied the motion.
On appeal, plaintiffs have not demonstrated to the court that any of these findings are clearly erroneous.[8] They argue that the debtor has assets in Louisiana, but do not demonstrate that he has any equity in those assets, such that their location militates towards a transfer. Their other arguments on appeal concern the availability of witnesses and the fact that plaintiffs have a similar action pending in Louisiana concerning the debt owed to them by the debtor's former business partner. With respect to plaintiffs' argument that it would be less expensive for plaintiffs to pursue their action in Louisiana, the court agrees with the bankruptcy court's analysis. Plaintiffs chose to bring this adversary proceeding. The debtor must defend it. The court does not have the responsibility to provide plaintiffs with the most cost-effective forum. It makes more sense for this adversary proceeding to be resolved in the bankruptcy court that has already dealt with the underlying bankruptcy. Further, the bankruptcy court found that the existence of plaintiffs' action against defendants' former business partner did not merit a transfer, and plaintiffs have not given the court any specific reason to overturn those findings.
One potentially meritorious argument raised by plaintiffs is their contention that compulsory service of process will not be available to obtain witnesses' appearance in Georgia. However, they have not demonstrated that compulsory process will be necessary to prove the issues they need to prove in this adversary proceeding. It may be that any live testimony may come from witnesses who are ready, willing and able to come to Georgia. In addition, while the court acknowledges the general preference of live testimony, there is no reason to believe that deposition testimony would be insufficient or would otherwise create special problems in this case. In any event, should it become evident that compulsory process is vital to present the proof necessary to resolve the dischargeability issue, the parties may bring that to the attention of the bankruptcy court, and the court may reconsider the transfer issue at that time.
IV. CONCLUSION.
In sum, the court finds that the bankruptcy court's January 5, 1988 order denying plaintiffs' motion for a transfer is not clearly erroneous. Accordingly, it is AFFIRMED.
NOTES
[1] The transcript of this hearing has not been made a part of the record.
[2] This appeal was originally submitted for consideration to the Honorable Orinda D. Evans on April 21, 1988. By order entered May 27, 1988, however, the appeal was transferred to the undersigned judge.
[3] Section 1412 replaced section 1475 which provided, "A bankruptcy court may transfer a case under Title 11 or a proceeding arising under or related to such a case to a bankruptcy court for another district, in the interest of justice and for the convenience of the parties."
[4] 28 U.S.C. § 1471(b) (1976 ed., Supp. IV).
[5] By standing order entered July 12, 1984, and pursuant to § 157(a), "all cases under Title 11 [core proceedings] . . . and all proceedings arising in or related to a case under Title 11 [noncore proceedings] . . ." in the Northern District of Georgia were referred to the bankruptcy court for this district.
[6] Obviously, the fact that Congress denominates a particular proceeding as "core" does not automatically mean that a bankruptcy court may constitutionally enter a final order in that proceeding. However, a proceeding properly determined to concern the administration of the estate will pass the Northern Pipeline analysis and thus may be referred to the bankruptcy court for final disposition. See In re Thomasson, 60 B.R. 629, 631 n. 4 (Bankr.M.D.Tenn.1986).
[7] Bankr.Rule 7019 applies to joinder of third parties and is thus not applicable to the present action.
[8] As noted previously, plaintiffs apparently chose not to have a transcript of the hearing on their motion made a part of the record on appeal. As it is the plaintiffs' burden to demonstrate that the bankruptcy court's findings were clearly erroneous, the court must weigh any unsubstantiated challenges to the bankruptcy court's findings in favor of the debtor; the plaintiffs, not the debtor, are responsible for the court's inability to review the basis for those conclusions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920092/ | 91 B.R. 401 (1988)
In re Donald Eugene PETERS and Carolyn Jean Peters, Debtors.
Bankruptcy No. 88-10360.
United States Bankruptcy Court, W.D. Texas, Austin Division.
September 20, 1988.
*402 John B. Meadows, Meadows & Welch, Austin, Tex., for debtors.
Beth Fielding Siever, Austin, Tex., for trustee.
MEMORANDUM OPINION
LARRY E. KELLY, Bankruptcy Judge.
On the 3rd day of August, 1988, this Court heard the objections of the Trustee to certain real and personal property exemptions claimed by Donald E. Peters and Carolyn J. Peters, (hereinafter "Debtors"). The real property is located in Sao Paulo, Brazil and it is the location of the real property, outside of the State, which forms the basis of the Trustee's objection. The objection to the personal property centers on the values attributed to the property by the Debtors and on the issue of whether jewelry can be exempted in light of the recent amendments and codification of the Texas Property Code (hereinafter referred to as "Property Code") TEX.PROP.CODE § 42.001(a). For the reasons stated the Court sustains the Trustee's objection to Debtor's homestead claim and overrules the objections to the personal property including the jewelry. This matter is a core proceeding within the meaning of 28 U.S.C. § 157(b)(2)(A) and (B).
I. FACTUAL BACKGROUND
1.01. The Debtors commenced this Chapter 7 case with a voluntary petition on February 8, 1988.
1.02. Schedules were timely filed and in Schedule B-4, Debtors listed those assets they claimed as exempt, opting to use applicable state law as authorized by 11 U.S.C. § 522(b)(2).
1.03. The Trustee timely objected to the homestead claim, the jewelry and the aggregate values attributed to the jewelry, household goods and art objects.
1.04. In pertinent part Debtors' Schedule B-4 and Debtors' Exhibits at the trial list:
a. Residence located in Sao Paulo, Brazil;
b. Personal jewelry consisting of:
(1) Men's wedding ring estimated value $200.00;
(2) Men's Seiko watch estimated value $50.00;
(3) Three men's class rings estimated value $150.00;
(4) Ladies Seiko watch estimated value $50.00;
(5) Citrine ring estimated value $165.00;
(6) One carat diamond wedding ring estimated value $1800.00;
(7) Tourmaline pendant estimated value $60.00;
(8) Emerald-cut tourmaline estimated value $100.00;
*403 (9) Two gold bangles estimated value $100.00;
(10) One gold bracelet estimated value $100.00;
(11) One gold chain estimated value $100.00;
(12) Garnet and tourmaline earrings estimated value $125.00.
Total estimated value $3,000.00.
c. Miscellaneous art objects consisting primarily of small sculptures, watercolors, paintings, prints, sketches and rugs valued at $3,180.00;
d. Various itemized household goods and appliances valued at $9295.00.
1.05. All of the jewelry was used by Debtors in their usual and normal course of living and was not in any way acquired for reinvestment.
1.06. All of the artwork was acquired and is used by the Debtors in the usual and normal course of living and was displayed in their house as normal decoration. It was not in any way acquired as an art collection or for reinvestment.
1.07. All of the household goods and appliances were acquired and used in the usual and normal course of Debtors' daily living.
1.08. The Trustee introduced no evidence to counter the values testified to by the Debtors. The Court found Debtors' testimony to be credible. Therefore, the aggregate value of the jewelry, artwork and household goods is found to be those values indicated above.
1.09. The residence in Sao Paulo, Brazil was purchased by the Debtors when they lived and worked in Brazil and they used it as their principal residence. Approximately one year prior to the filing of this bankruptcy Debtors returned to the United States, first living in Lakeway, Texas and currently living in Houston, Texas. Their home in Brazil is leased. Debtors own no other real estate which they claim as homestead in Texas or elsewhere. Although Debtors would like to find an opportunity to return to Brazil, they currently have no plans or expectations of returning.
II. ISSUES
2.01. The first issue is whether a debtor filing bankruptcy in Texas and claiming exemptions under the Texas statutes, can exempt residential real property located outside the state.
2.02. The second issue is whether or not jewelry falls within the scope of the list of eligible items of personalty which debtors can exempt from property of the estate under Texas law.
2.03. A third issue is whether this Court can rule on the second issue in light of a recent District Court opinion within this District which has ruled that jewelry cannot be exempted under the applicable Texas statute.
III. DISCUSSION CONCERNING HOMESTEAD CLAIM TO RESIDENCE IN SAO PAULO, BRAZIL
3.01. Exemption laws are local in their nature and have no extra-territorial force or operation; they relate to the remedy and depend on the law of the forum. Bell v. Indian Line-Stock Co., 11 S.W. 344 (Tex.1889); William Cameron and Co. v. Abbott, 258 S.W. 562 (Tex.Civ.App. Amarillo, 1924, no writ).
3.02. The law setting forth an individual's right to claim real property homestead exemptions in Texas is established in Article XVI, § 51 of the Texas Constitution and in the Property Code §§ 41.001 and 41.002. The Texas homestead exemption, based on size rather than value, is among the most generous, if not the most generous in the United States. See Collier on Bankruptcy, (15th ed.), Vol. 7 (1987).
3.03. Homestead is defined in Property Code § 41.002:
"(a) If used for the purposes of an urban home or as a place to exercise a calling or business in the same urban area, the homestead of a family or a single adult person, not otherwise entitled to a homestead, shall consist of not more than one acre of land which may be in one or more lots, together with any improvements thereon.
. . . . .
*404 (c) The definition of a homestead as provided in this section applies to all homesteads in this state whenever created." (emphasis added).
3.04. This Court has previously been faced with a similar issue involving proceeds from a pre-petition sale of a debtor's Iowa homestead. At that time this Court ruled that Texas statutory references to homestead are limited to homesteads located within the state of Texas. In Re John and Joann Schmidt, Case No. 1-86-01102 (Bankr.W.D.Tex., September 1, 1987).
3.05. To reach a contrary result could lead to absurd results. By the mere happenstance of filing in Texas, or through blatant forum shopping, a debtor could attempt to change the size, value or susceptibility to claims of creditors of real property located in other states, or as in this case, other countries. The case of William Cameron and Co. v. Abbott, supra, also supports the proposition that statutory references to homesteads are limited to real property located within this state. That decision reviewed several cases involving sales of homestead in one state and attempted exemption of the proceeds pursuant to the law of a second state. It also referred to decisions holding that the proceeds from the sale of a homestead had to involve proceeds from the sale of a homestead within the state whose exemption laws were being asserted. In reviewing those cases the court stated:
"They are correct, however, we think in the holding that the homestead exemption laws of the state are to be construed as applying only to homestead property within such state."
This Court concurs in that observation.
IV. DISCUSSION CONCERNING CLAIMED PERSONALTY AND JEWELRY
4.01. The facts show that the Debtor's jewelry, art objects and household goods and appliances are valued well under the $30,000.00 aggregate valuation which can be claimed as exempt under Property Code § 42.001(a). The Court finds that the art objects and household goods are not collections or items acquired for reinvestment. The Trustee therefore has failed to meet her burden of proof to demonstrate that the items are not properly claimed. Property Code, § 42.001(a) and Bankruptcy Rule 4003(c).
4.02. The Trustee's objection to the exemption of Debtors' jewelry however merits more serious attention. A recent District Court opinion in this District, affirming a prior Bankruptcy Court opinion, has ruled that "jewelry" is not within the pale of items eligible to be exempted under Property Code § 42.002(3)(C). In Re Francisco A. Fernandez and Maura M. Fernandez, 89 B.R. 601 (W.D.Tex.1988) (hereinafter "Fernandez"). The Fernandez opinion observed that Property Code § 42.002
". . . lists the various categories of personal property eligible for exemption, none of which include jewelry."
The decision concludes that jewelry is therefore not eligible to be exempted. The cited Property Code section does list "clothing" while its predecessor, Articles 3836 and 3832 refer to "wearing apparel". The Fernandez opinion cites Websters Ninth New Collegiate Dictionary, G & C Merriam Co., 1987 and Black's Law Dictionary, page 1765, (revised 4th Ed.1968) as authority for the proposition that the term "wearing apparel" is a broader category than the current term "clothing". With this reading the District Court denied the Debtor's claimed jewelry exemption.
4.03. It is with the utmost respect for the District Court and the doctrine of the law of the case that this Court hesitantly goes forth to note its opinion that "clothing," within the meaning of Property Code § 42.002 is a synonymous term with "wearing apparel" and alternatively that Property Code, § 42.002(3)(C) does encompass jewelry to the extent reasonably necessary for a debtor's family.
A. STATUTORY BACKGROUND AND DEFINITIONS
4.04. This analysis must begin with some essential fundamentals. In Butner v. United States, 440 U.S. 48, 50, 99 S.Ct. *405 914, 915, 59 L.Ed.2d 136 (1979), the Supreme Court recognized that property rights are created by state law and that unless federal law requires a different result, state law should govern property law issues in federal court.
4.05. Article 1, § 8, cl. 4 of the United States Constitution requires Congress to establish uniform laws on the subject of Bankruptcy. Pub.L. 95-598, Title I, Nov. 6, 1978, 92 Stat. 2549 enacted the current bankruptcy laws and codified them into Title 11 of the United States Code.
4.06. 11 U.S.C. § 522(b) allows an individual debtor to exempt from property of the estate that property listed in paragraph (1) or paragraph (2) of § 522(b). The debtor therefore is given the right to elect whether to rely on the exemption laws of his own state or on those of the United States. Sub-paragraph (2) provides the debtor with the right to exempt under subsection (2)(A) "Any property that is exempt under . . . State or local law that is applicable on the date of the filing of the petition . . .". (emphasis added). The fact that the federal statute, the general intent of which is to enact a uniform law on bankruptcy, allows invocation of state law as to exemptions indicates that there is no overriding federal interest as to exemptions. The Debtors in this case have elected to claim under § 522(b)(2)(A), state exemptions. Therefore, state law must govern the outcome of objections to the exemptions which the Debtors have claimed in this case.
4.07. It is undisputed that when state exemptions are elected, exemptions are to be allowed or set aside in accordance with the state or local laws in effect at the time of the filing of the bankruptcy petition. 11 U.S.C. § 522(b)(2)(A).
4.08. At the time this case was commenced, Property Code § 42.002 governed exemptions of property under Texas law. The Property Code had been enacted by the 68the Texas Legislature acting in regular session in 1983, with the Property Code taking effect January 1, 1984. The Property Code was intended to revise the language, but not the meaning of the existing state statutes as a part of an ongoing statutory revision program authorized by the Texas Legislative Council. See generally, Vernon's Annotated Article Texas Statute 5429b-1, et seq, repealed by Acts 1985, 69th Leg., Ch. 479 § 224 effective September 1, 1985 and now found in titles No. 1 and No. 3 of the Government Code. TEX.GOV'T CODE ANN. §§ 311.001-312.013 (Vernon 1988).
4.09. TEX.GOV'T CODE ANN. § 323.006 details the powers and duties of the Texas Legislative Council:
"(a) The council shall:
(6) report council recommendations to the legislature and, if appropriate, provide drafts of legislation with the report;
(7) assist the legislature in drafting proposed legislation; and
(b) By agreement with either house of the legislature or legislative agency, the council may perform other services or functions for or on behalf of the house or agency."
4.10. The statutory revision program is explained in TEX.GOV'T CODE ANN. § 323.007 as follows:
"(a) The council shall plan and execute a permanent statutory revision program for the systematic and continuous study of the statutes of this state and for the formal revision of the statutes on a topical or code basis. The purpose of the program is to clarify and simplify the statutes and to make the statutes more accessible, understandable and usable. (emphasis added).
(b) When revising a statute the council may not alter the sense, meaning, or effect of the statute. (emphasis added).
(c) As part of the statutory revision program, the council shall:
(1) prepare a statutory record showing the status and disposition within the classification of the revised statutes of all Acts enacted by the Legislature;
(2) prepare and submit to the Legislature in Bill form statutory revisions on a topical or code basis;
*406 (3) include a report with each revision that contains revisor's notes explaining in detail the work done; and
(4) formulate and implement a continuous revision program so that statutes that have been revised and enacted may be updated without the need for subsequent major revisions."
4.11. As a part of the revision process the Property Code was enacted. The specific purpose of the Property Code is stated in Property Code § 1.001:
"(a) This Code is enacted as a part of the State's continuing statutory revision program begun by the Texas Legislative Council in 1963 as directed by the Legislature in Chapter 448 Acts of the 58th Legislature, Regular Session 1963 (Article 5429 b-1, Vernon's Texas Civil Statutes). The program contemplates a topic by topic revision of the State's general and permanent statute law without substantive change. (emphasis added).
(b) Consistent with the objectives of the statutory revision program, the purpose of the Code is to make the law encompassed by this Code more accessible and understandable by:
(1) Rearranging the statutes into a more logical order;
(2) employing a format and numbering system designed to facilitate citation of the law and to accommodate future expansion of the law;
(3) eliminating repealed, duplicative, unconstitutional, expired, executed, and other ineffective provisions; and
(4) restating the law in modern American English to the greatest extent possible." (emphasis added).
4.12. It is therefore abundantly clear that the Texas Legislature did not intend to substantively change prior Texas law relating to exemptions by enactment of the Property Code.
4.13. The Fernandez opinion correctly notes that state exemption law prior to enactment of the Property Code did not itemize jewelry as a category of personal property eligible to be exempted. It recognized that prior Texas law had permitted certain items of jewelry to be included as exempt property under the "wearing apparel" category, citing Hickman v. Hickman, 228 S.W.2d 565 (Tex.Civ.App. Eastland 1950), aff'd 149 Tex. 439, 234 S.W.2d 410 (1950); and First National BankEagle Lake v. Robinson, 124 S.W. 177, 179 (Tex. Civ.App. San Antonio 1910, no writ). Other authorities for the proposition that jewelry was eligible personal property which could be exempted under the predecessor Texas Exemption Statutes include Sellers v. Bell, 94 F. 801, 810-12 (5th Cir. 1899) (necessary and proper wearing apparel includes watch worn by debtor); In Re Richards, 64 F.Supp. 923 (S.D.Tex.1946) (diamond ring is exempt property under Texas Personal Property Exemption Statute); and In Re Evans, 25 B.R. 105 (Bankr. N.D.Tex.1982) (Rolex watch is exempt).
4.14. Since neither the Property Code nor its predecessor statutes, Articles 3836 and 3832 specifically itemize "jewelry", it is important to focus on why the Fernandez opinion concluded that the Property Code has "excluded the possibility of jewelry as exempt personal property" while acknowledging that the predecessor statutes clearly included the possibility of jewelry as exempt personal property. At the heart of the Fernandez opinion is the assumption that the change in language from Vernon's Annotated Texas Statute, Articles 3832 and 3836 to Texas Property Code § 42.002(3)(C), (from "wearing apparel" to "clothing"), was a substantive change to a narrower definition of the type of personal property eligible to be exempted, which now excludes jewelry. In Fernandez the Court looked to the literal language of the Property Code provision and made its ruling after looking at Webster's Ninth New Collegiate Dictionary ("Webster Ninth") and Black's Law Dictionary, supra. The Fernandez court did not address the legislative history which indicates that the wording of the Property Code was not intended to work any substantive change from the predecessor property statutes. Because of the Fernandez focus on the language of the Property Code, this Court asserts its view that "clothing" and "wearing apparel" are synonymous terms.
*407 4.15. Going blindly in, where wiser men should fear to tread, this Court will engage in the battle of the dictionaries.[1] First it is noted that Webster's Ninth is an "abridged"[2] version. Webster's Ninth defines "clothing" as "garments in general" and then defines "garments" as "articles of clothing". Although wearing apparel is not a separately defined term in Webster's Ninth, "apparel" is defined as "personal attire; CLOTHING; something that clothes or adorns." It would appear, based on the definitions in Webster's Ninth, that wearing apparel, or apparel, is a slightly broader definition than clothing. Based on this definition Fernandez determined that clothing was in fact a more restrictive term and that jewelry was no longer within the scope of its meaning. No explanation is given as to why jewelry would not otherwise be within the perceived narrower scope of clothing even if such narrower scope was a fact.
4.16. To determine if the meaning of "clothing" is so narrow as to foreclose its inclusion of to general items of adornment, such as items of jewelry which are reasonably necessary for a family or an individual, this Court did resort to other dictionaries and found the definitions in pertinent part as indicated:
a. Webster's II New Riverside University Dictionary, the Riverside Publishing Co., 1984 Ed. (Abridged):
(1) Clothing "clothes";
(2) Clothes "WEARING APPAREL, garments" (emphasis added);
(3) Apparel "clothing: something that covers or adorns" (emphasis added).
(b) Webster's Third New International Dictionary, G & C Mariam Co., 1981 ed.:
(1) Clothing "all the garments and accessories worn by a person at any one time"; (emphasis added).
(2) Apparel "something that clothes or adorns as if with garments." (emphasis added).
(c) Webster's New Universal Unabridged Dictionary, Dorset and Baber, 2d Ed.1979:
(1) Clothing "garments in general; clothes; raiment.";
(2) Clothes "covering for the human body; articles usually of cloth, designed to cover, protect, or adorn the body . . .". Clothing is noted as a synonym of "apparel";
(3) Apparel "clothing; garments; dress; anything that clothes or adorns." (emphasis added).
(d) The Random House Dictionary of the English Language, Unabridged Edition, Random House/New York, 1971 ed.:
(1) Clothing "garments collectively; clothes, raiment, apparel." (emphasis added).
(2) Wearing apparel "clothing" (emphasis added).
(3) Apparel "a person's clothing, garments; attire . . . to adorn . . . ".
(e) Webster's New World Dictionary,
The World Publishing Co., 1963 ed.:
(1) Clothing "clothes; wearing apparel".
(2) Apparel "clothing".
(3) Wearing apparel "garments; clothing" (emphasis added).
(f) The Oxford English Dictionary, (unabridged) Vol. II, Oxford at the Clarendon Press, (1933 ed.):
(1) Clothing "clothes collectively, apparel, dress"; (emphasis added).
(2) Apparel "personal outfit or attire; clothing generally, raiment, dress". (emphasis added).
*408 Other resource works also support a conclusion that these two terms are essentially synonymous.[3]
4.17. Taking the clear intent of the Legislature as stated in Property Code §§ 1.001 and 1.002 along with these additional standard reference dictionaries, this Court concludes that the plain and normal associations used in the American language support the opinion that "clothing" is synonymous with "wearing apparel". For both reasons, prior case law is applicable. This Court respectfully concludes that jewelry, to the extent reasonably necessary for a family or individual is eligible personal property for exemption purposes based on Property Code Section 42.001 as interpreted by applicable case law.
B. LIBERAL, NOT LITERAL CONSTRUCTION
4.18. Even if this Court were wrong in deriving its conclusion based on definitions through standard reference works, it could not make the leap that Fernandez does after it determined that "clothing" was a narrower term than "wearing apparel" and then stated that jewelry could not be included within the scope of such narrower term.
4.19. In determining the scope and meaning of any exemption statute bankruptcy courts have long observed the principle that exemptions are to be liberally construed in favor of the debtor. Hyman v. Stern, 43 F.2d 666 (4th Cir.1930); Meritz v. Palmer, 266 F.2d 265 (5th Cir.1959).
4.20. Exemption laws are local in their nature and have no extra-territorial force or operation. Therefore they relate to the remedy and depend on the law of the forum. Bell v. Indian Line Stock Co., 11 S.W. 344 (Tex.1889). It has been said that exemption laws are subjected to the most liberal construction that the Court can possibly give; the Courts take the stand that since the statutes have a beneficial object, it is the court's first duty to see that this object is accomplished. Gaddy v. First National Bank, 115 Tex. 393, 283 S.W. 472 (Tex.1926).
4.21. In applying the bankruptcy law of the United States to exemptions claimed by bankrupt residents in Texas, the interpretations given to the exemption laws by the courts of Texas govern as precedent. The federal courts, therefore, must give to the exemption laws the same liberal construction in favor of the person claiming the exemption as is accorded to them by the Texas courts. Southern Irrigation Co. v. Wharton National Bank, 144 S.W. 701 (Tex.Civ.App. San Antonio 1912, no writ); In Re Thompson, 103 F.Supp. 942 (S.D. Tex.1952); and Phillips v. Palomo & Sons, 270 F.2d 791 (5th Cir.1959); also In Re Schneider, 9 B.R. 488 (D.C.Cal.1981) (where debtor chooses to exempt property under applicable state provisions, interpretation of those provisions is to be guided by state law and state court decisions; extent of such application is to be governed by applicable state non-bankruptcy law.)
4.22. Statutes are to be read in conjunction with the constitutional provision pursuant to which they were enacted and are to be construed so as not to change the clear mandate of the Constitution. Stichter v. Southwest National Bank, 258 S.W. 223 (Tex.Civ.App. Dallas 1924, writ dism'd). A fair construction of the grants of exemptions must include not only the subject itself, but everything essential to its beneficial enjoyment. Cobbs v. Coleman, 14 Tex. 594 (1855). (emphasis added)
4.23. Texas courts have long held that liberal views prevail with regard to Texas exemptions claims. See generally Cobbs v. Coleman, 14 Tex. 594 (1855); Rodgers v. Ferguson, 32 Tex. 523 (1870); Patterson v. English, 142 S.W. 18 (Tex.Civ.App. Amarillo, 1911, no writ history); Malone v. Kennedy, *409 272 S.W. 509 (Tex.Civ.App. Beaumont, 1925, no writ history); Cities Service Co. v. North River Insurance Co., 130 Tex. 186, 107 S.W.2d 994 (Tex.Comm'n. App.1937); Moore v. Neyland, 180 S.W.2d 658 (Tex.Civ.App. Texarkana, 1944, no writ history);
4.24. In Meritz v. Palmer, supra, the Fifth Circuit reversed a lower court decision interpreting the Texas Exemption Statute at that time, Article 3832, subsection 5, which provided for the exemption of "tools and apparatus of trade." The lower court was reversed for following a "strict rather than a liberal construction." Meritz v. Palmer, supra at 267. The Texas Supreme Court decision of Green v. Raymond, 58 Tex. 80 (1882) was quoted by the Fifth Circuit as authoritatively setting forth the controlling principles:
"The settled policy has ever been to make liberal exemptions of property from forced sale in this state. That liberality has been extended from time to time, until today Texas, in this particular, surpasses all the other states in the American union. . . .
It has not been the policy of the judicial department to restrict this liberalizing trend of the law-making powers by a strict construction of these laws; on the contrary, they have been `liberally construed with a view to effect their objects and to promote justice.'"
4.25. In another early federal court decision which struggled with the meaning of "wearing apparel" in the Texas exemption statute, the court stated that
". . . the phraseology of the Texas statute is as comprehensive as language can make it and, as has been seen, exempts from forced sale all wearing apparel. In this connection it may be remarked that the exemption laws of this state are liberally construed in favor of the person claiming the exemption." (Emphasis added).
In Re Smith, 96 F. 832, 833 (W.D.Tex. 1899). (Exempting a diamond shirt stud under the provisions of Tex.Rev.Civ.Stat. Ann. Art. 2397).
This same decision also recognized other state cases interpreting the language of applicable Texas Exemption Statutes to include more than what is literally stated as eligible for exemption. See, e.g., St. Louis Foundry v. International Livestock, Printing and Publishing Co., 74 Tex. 651, 12 S.W. 842 (Tex.1889) (holding that the press, type and material belonging to a firm of painters is exempt as tools and apparatus belonging to a trade or profession); Allison v. Brookshire, 38 Tex. 200 (the word "horses" in effect is held to be a generic terms and under the statute it was construed to embrace a mule); Rodgers v. Ferguson, 32 Tex. 533 (drays and carts are held to be included within the term "wagon"); Cobbs v. Coleman, 14 Tex. 596 (1855) (an exemption of a horse is held to extend to things that would make its use beneficial so that a saddle, bridle, etc., are exempt); and Dearborn v. Phillips, 21 Tex. 451 (the exemption of a "horse" would include a rope).
It is evident that Texas courts use the principle of liberality, not the strict construction of literalism, in dealing with questions of exemptions. The present Property Code also fails to address issues relating to items such as saddles, bridles, blankets or ropes for horses as well as items such as eye glasses, purses, wallets, umbrellas or usual and normal items of jewelry. This Court believes that the Texas Exemption Statutes were not intended to be a literal laundry list of eligible items of property subject to exemption, but rather, to be considered as generic categories which the courts are to review with a liberal construction in resolving factual disputes such as the one at bar.
4.26. As previously pointed out, this Court believes that the Property Code term "clothing" is synonymous with the term "wearing apparel" used in the pre-Code statutes. Therefore Property Code § 1.002 would compel this Court to consider this prior case law construing those pre-Code statutes in analyzing whether the jewelry at issue can be exempted.
Even if the definition was not synonymous, however, and even if the Fernandez *410 opinion that clothing be considered a more narrowly defined term than wearing apparel is accepted as accurate, this Court still believes that items of jewelry which are usually and normally associated with a family or an individuals daily wearing habits, should under the principal of a liberal and not a literal construction, be eligible for exemption in this case.
C. PRINCIPLES OF STATUTORY CONSTRUCTION
4.27. All of the Court's previous discussion is further supported by general principles of statutory construction. The Fernandez opinion correctly cited Carbide International Ltd. v. State of Texas, 695 S.W.2d 653 (Tex.App. [3rd Dist.] (Austin) 1985, no writ) for the principle that once laws are revised and codified, the Code becomes the statutory law of the state and it can be looked to without resorting to previous statutes, except to explain contradictions and ambiguities. Fernandez did not, however, specifically address the "ejusdem generis" principle of statutory construction which was raised in Carbide. Supra.
4.28. Ejusdem generis states that "when particularly described things are followed by words of a more general description, the general description is not to be construed in its widest sense but is held to encompass only things of the same general class as those particularly described. See Carbide International, at 656-657. The term "clothing" in the Property Code is a general descriptive term which is not preceded by specific or particularly described items of clothing otherwise listed within the statute. Therefore, the ejusdem generis doctrine discussed in the Carbide International opinion would not appear to apply to the interpretation of this exemption provision.
4.29. Carbide International is instructive on the limits of canons of construction such as ejusdem generis:
"the principle of ejusdem generis, if it be applicable . . . may not prevail if the statute in general contains language which effectively discloses a legislative intent contrary to the interpretation which the principle would produce," (emphasis added)
citing Employers Casualty Co. v. Stewart Abstract Co., 17 S.W.2d 781 (Tex.Comm'n. App.1929). A further qualification on the doctrine is that general words are not restricted in meaning to objects of the same kind if there is a clear manifestation of a contrary intent. United States v. Staats, 8 How. (49 U.S.) 41, 12 L.Ed. 979 (1850); United States v. Mescall, 215 U.S. 26, 30 S.Ct. 19, 54 L.Ed. 77 (1909). In the words of the United States Supreme Court,
"while the rule is a well established and useful one, it is, like other canons of statutory construction, only an aid to the ascertainment of the true meaning of the statute. It is neither final nor exclusive. . . . If upon a consideration of the context and the objects sought to be attained and of the act as a whole, it adequately appears that the general words were not used in the restricted sense suggested by the rule, we must give wider effect to the conclusion afforded by the wider view in order that the will of the Legislature shall not fail."
Helvering v. Stockholms Enskilda Bank, 293 U.S. 84, 88-89, 55 S.Ct. 50, 52, 79 L.Ed. 211 (1934). Property Code sections 1.001 and 1.002 disclose the clear legislative intent to follow prior state law interpreting exemptions. This Court does believe Carbide International's direction to look to the codified statute, relied upon by Fernandez, is qualified by Carbide International's further instruction to consider legislative intent, overlooked in Fernandez.
4.30. The problem is not with stating various principles of statutory construction, however, but with the application thereof. A leading authority on the overall issue is Sutherland on Statutory Construction ("Sutherland"). Statutory construction and a court's struggles with the meaning of words written by others has long been a recognized contest between two or more probabilities of meaning.[4]
*411 4.31. Section 46.07 of Sutherland, entitled Limits of Literalism, states:
"The literal interpretation of the words of an Act should not prevail if it creates a result contrary to the apparent intention of the legislature and if the words are sufficiently flexible to allow a construction which will effectuate the legislative intention. The intention prevails over the letter, and the letter must, if possible, be read to conform to the spirit of the act."
Sands, Sutherland Stat. Const. § 46.07 (4th Ed.).
4.32. In looking at what is referred to as the principal of judicial restraint, at least as applied to statutory construction, another respected jurist has written:
"The basic principle of judicial restraint in statutory interpretation is deceptively simple: stay close to the statutory language. If the statutory language is clear and the result of a literal interpretation does not seem to be one completely unanticipated by the legislature, then relying on the language of the statute is relatively uncontroversial. If the statute is unclear, however, or if read literally applies to a situation in a way that the legislature probably did not intend, the task is more difficult." (emphasis added). J. Clifford Wallace, The Jurisprudence of Judicial Restraint: A Return to the Moorings, 50 Geo.Wash.L.Rev. 649, 650 (1981).
This commentary goes on to observe that even where there is no prior case law on the point, certain principles apply:
"(1) clarify only as much of the statute as is necessary to decide the case before the court;
(2) clarify the statute in the fashion that the legislature probably would have, had the ambiguity been brought to its attention;
(3) follow common law principals of statutory construction; and
(4) clarify the statute in a manner that innovates the least against the background of prior law . . . ".
It further states that "for the most part, common law construction principles are intended to reproduce the intent of the legislature." See, J. Clifford Wallace, supra.
4.33. "Words in statutes are not unlike words in a foreign language, in that they too have associations, echoes and overtones." Frankfurter, Some Reflections on The Reading of Statutes, 47 Col.L.Rev. 527 (1947).
4.34. Because the meaning of the term "clothing" is at best ambiguous, a court must in any fact situation, involving exemptions under the Property Code, construe the meaning of the term in accordance with the facts of the case. This Court has noted its conclusion that definitionally the term "clothing" is synonymous with "wearing apparel". Definitionally, the rule *412 which should prevail in this situation is best expressed by Justice Frankfurter:
"Legislation when not expressed in technical terms is addressed to the common run of men and is therefore to be understood according to the sense of the thing, as the ordinary man has a right to rely on ordinary words addressed to him."
Addison v. Holly Hill Fruit Products, Inc., 322 U.S. 607, 618, 64 S.Ct. 1215, 1221, 88 L.Ed. 1488, 1496 (1944).
4.35. Alternatively, this Court has noted its conclusion that if the terms were not considered synonymous and the scope of the term `clothing' was more restrictive than `wearing apparel'; applying the principle of liberal interpretation as required by state law, Butner v. U.S., supra, and Fifth Circuit authority, interpretation would allow jewelry, to the extent reasonably and normally associated with items of adornment which are normally worn by individuals or maintained by families in this state, to be considered eligible personal property subject to exemption.
4.36. Finally, principles of statutory construction recognize that when a court is faced with a statutory term or word which is susceptible of more than one meaning, the court must strongly consider legislative intent. If the definitions were not synonymous, they would need to be interpreted as synonymous because that is what the Texas Legislature mandates. TEX.GOV'T CODE ANN. § 323.007(b) and Property Code § 1.001.
"Tex.Prop.Code Ann. § 42.001 . . . represents a codification of pre-existing property law which was emphatically intended not to effect substantive changes in the law. The foreword to the Texas Property Code urges the reader to keep in mind that, `this is a non-substantive revision.' Similar sentiments are expressed throughout the revisers report written by the executive director of the Texas Legislative Council, which prefaces the volumes containing the Property Code . . . [i]t is not within our domain to reformulate either Texas law or our panel's prior interpretation of Texas law." (emphasis added).
In the Matter of C.T. Bessent, et ux., Silva R. Bessent v. United States of America, (Farmers Home Administration), 831 F.2d 82, 83 (5th Cir.1987).
V. DOCTRINE OF LAW OF THE CASE
5.01. In preparing this opinion this Court was confronted by the doctrine of the law of the case. The rules of this doctrine have been devised to maintain consistency and to avoid reconsideration of matters once decided during the course of a single continuing law suit. See, generally, WRIGHT, MILLER & COOPER, FEDERAL PRACTICE AND PROCEDURE § 4478, at 788, (1982).
There are generally four distinctive problems which arise under this doctrine:
1. Desire of a single court to adhere to its prior rulings without need for repeated reconsideration;
2. Obligation of every court to honor the rulings of a court that stands higher in a hierarchical judicial structure;
3. Respect that one judge or court owes to the rulings of another judge or court in closely related cases; and
4. Issues which arise as a consequence of failure to appeal an issue.
Certainly the second and third of these arguably apply to the case at bar.
5.02. The law of the case directs a court's discretion, but it does not limit the tribunal's power. Arizona v. California, 460 U.S. 605, (1983) 103 S.Ct. 1382, 1391, 75 L.Ed.2d 318; U.S. v. Dejesus, 752 F.2d 640, 642 (1st Cir.1985) (Law of the case is not a jurisdictional bar to reconsideration of the issue . . .); and Lourmar, Inc. v. Smith, 698 F.2d 759, 762 (5th Cir.1983) (Law of the case doctrine "is not . . . a barrier to correction of judicial error. It is a rule of convenience and utility and yields to adequate reason.")
5.03. Departure from the law of the case established from an earlier decision such as Fernandez, requires a compelling reason. Major grounds recognized by case law include intervening change of controlling law, the availability of new evidence, *413 or the need to correct a clear error or prevent manifest injustice. White v. Murtha, 377 F.2d 428, 431-32 (5th Cir. 1967).
5.04. "Law of the case terminology is often employed to express the principle that inferior tribunals are bound to honor the mandate of superior courts within a single judicial system." Insurance Group Comm. v. Denver and R.G.W. Railroad, 329 U.S. 607, 612, 67 S.Ct. 583, 585, 91 L.Ed. 547 (1947); South Central Livestock Dealers, Inc v. Security State Bank, 614 F.2d 1056, 1059 (5th Cir.1980).
5.05. Of course, the scope of the prior rulings and their finality play an important role in the application of this doctrine. Also, there exists a difference between the rule that permits reconsideration of prior rulings by the same judge who made them and the rule that requires an inferior tribunal to heed the commands of a superior tribunal. Prior rulings may be offered for reconsideration by different members of the same court within the framework of a single case or closely related cases and various degrees of fealty have been recognized in each of the many settings that come within this broad description. Wright, Miller and Cooper, supra at 794.
5.06. With all due respect this Court is aware that it is an inferior tribunal in the hierarchy of this district and it has complete respect for the opinion of the District Court in this regard. It will, however, step forward with this opinion, not without trepidation, but based in part upon the confusion it discerns between Fernandez and prior state case law interpretations. This Court is not convinced that Fernandez supersedes the Fifth Circuit reasoning in Meritz v. Palmer, supra (exemption statutes are to be "liberally construed with a view to effect their objects and promote justice"). On the basis of this Court's review of the legislative intent contained in the Property Code, and the interpretation of U.S. Supreme Court and Fifth Circuit authorities cited herein, as well as on the exception of clear error, this opinion is respectfully proffered.
CONCLUSION
It is the opinion of this Court that the mandate of the Texas Legislature in codifying the Property Code not to make any substantive change has not been violated and the language of Property Code § 42.002(3)(C) is substantially synonymous with that of its predecessor statute, Tex. Rev.Civ.Stat.Ann., Articles 3836 and 3832. This Court further concludes that the liberal construction which courts in this state must give to exemption statutes also allows such jewelry to be included within the scope of the Texas Property Code § 42.002(3)(C). Furthermore, this Court finds that principles of statutory construction compel it to follow the mandate and intent of the legislature and prior case law authority which would allow jewelry in this case to be exempted.
A separate Order of even date herewith will be entered to effectuate this memorandum opinion.
ORDER ON TRUSTEE'S OBJECTION TO EXEMPTIONS
On the third day of August, 1988 this Court heard the objections of the Trustee to certain real and personal property exemptions claimed by Debtors in this case. Of even date herewith this Court has entered its memorandum opinion expressing the view that the objection of the Trustee to the real property of the Debtor is located in Sao Paulo, Brazil should be sustained and that the Trustee's objections to the remaining personal property, including jewelry, should be denied. The Findings of Fact and Conclusions of Law contained in the Memorandum Opinion are incorporated herein for all purposes.
IT IS THEREFORE ORDERED that the objection of the Trustee to the homestead exemption claimed by Donald E. Peters and Carolyn J. Peters, located in Sao Paulo, Brazil is sustained and such real property is determined not to be eligible for exemption; and
IT IS ALSO ORDERED that the remaining objections of the Trustee as to any and all remaining personal property, including *414 jewelry claimed by the Debtors is DENIED and such items are allowed as exempt.
IT IS SO ORDERED.
NOTES
[1] Webster's Ninth defines a dictionary in part as "a reference book containing words usually alphabetically arranged along with information about their forms, pronunciations, functions, etymologies, meanings and syntactical and idiomatic uses." (emphasis added).
[2] Webster's Ninth defines the term "abridged" in part as meaning "to reduce in scope . . . to shorten in duration or extent . . . to shorten by omission of words without sacrifice of sense." However well-intentioned, this Court concludes that the definition in Webster's Ninth for legal interpretation purposes did in fact sacrifice the sense intended by the legislators in enacting the Property Code.
[3] Roget's Thesaurus In Dictionary Form, Garden City Books, 1961 ed.
1. Clothing ". . . wearing apparel . . .". In the preface to this thesaurus, a stated aim is indicated in part to be the providing of ready synonyms.
Also see, The World Book Encyclopedia, Field Enterprises Education Group, Vol. 4: Clothing, (1976 ed.). "Includes all the different garments, accessories and ornaments worn by people throughout the world." (emphasis added).
[4] "Though it has its own preoccupations and its own mysteries, and above all its own jargon, judicial construction ought not to be torn from its wider, nonlegal context. Anything that is written may present a problem of meaning, and that is the essence of the business of judges in construing legislation. The problem derives from the very nature of words. They are symbols of meaning. But unlike mathematical symbols, the phrasing of a document, especially a complicated enactment, seldom attains more than approximate precision. If individual words are inexact symbols, with shifting variables, their configuration can hardly achieve invariant meaning or assured definiteness. Apart from the ambiguity inherent in its symbols, a statute suffers from dubieties. It is not an equation or a formula representing a clearly marked process, nor is it an expression of individual thought to which is imparted the definiteness a single authorship can give. A statute is an instrument of government partaking of its practical purposes but also of its infirmities and limitations, of its awkward and groping efforts . . . The process of construction, therefore is not an exercise in logic or dialectic: The aids of formal reasoning are not irrelevant; they may simply be inadequate. The purpose of construction being the ascertainment of meaning, every consideration brought to bear for the solution of that problem must be devoted to that end alone. To speak of it as a practical problem is not to indulge a fashion in words. It must be that, not something else. Not, for instance, an opportunity for a judge to use words as `empty vessels into which he can pour anything he will' his caprices, fixed notions, even statesman like beliefs in a particular policy. Nor on the other hand, is the process a ritual to be observed by unimaginative adherence to well-worn professional phrases." Justice Felix Frankfurther, Some Reflections on the Reading of Statutes, 47 Col.L.Rev. 527 (1947). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920096/ | 91 B.R. 77 (1988)
In re Tim KVAMME and Teri Kvamme, Debtors.
Bankruptcy No. 86-06005.
United States Bankruptcy Court, D. North Dakota.
August 18, 1988.
William F. Needler, Chicago, Ill., for debtor.
Glenn Fenske, Fargo, N.D., Local Counsel, for debtor.
Cameron Hayden, Bismarck, N.D., for USA/FmHA/ASCS.
Mark Larson, Minot, N.D., for Velva Credit Union.
R. James Maxson, Minot, N.D., for People's State Bank of Velva.
ORDER
WILLIAM A. HILL, Bankruptcy Judge.
At the confirmation hearing on the Debtors' third amended Chapter 11 plan held on August 9, 1988, the Debtors, through recently retained counsel conceded that the plan as written could not be confirmed but requested additional time to prepare a fourth amended plan modifying the treatment accorded FmHA.
FmHA is presently a Class 4 creditor holding a second mortgage on 1,200 acres presently valued at $98,948.00 in the aggregate. A first mortgage on the same land reduces FmHA's secured claim to $60,510.00. FmHA also has security in farm equipment worth $55,750.00 and in cattle worth $13,000.00. Its total loan balance is $368,205.00. On September 2, 1987, FmHA filed an 1111(b) election an event the third amended plan fails to address and one which the Debtors concede makes confirmation under Chapter 11 difficult if not impossible. The Debtors object to FmHA's 1111(b) election charging that the Agricultural Credit Act of 1987 (Act) operates to prohibit the election and instead mandates that FmHA restructure its claim downward to the value of the collateral. The parties seek a determination of this issue in advance of any further plan proposals.
Reliance is placed upon portions of the Act which amend 12 U.S.C. § 2202 by adding new sections relative to the restructuring of distressed loans. As relevant, these amending sections provide:
Section 4.14 A
(b)1 "On a determination by a qualified lender that a loan made by the lender is or has become a distressed loan, the lender shall provide written notice to the borrower [together with a copy of the lender's restructuring policy and materials necessary for the borrower to apply for restructuring]. * * *
(b)3 "No qualified lender may foreclose or continue any foreclosure proceeding with respect to any distressed loan before the lender has completed any pending consideration of the loan for restructuring under this section."
(c) "On determination by a qualified lender that a loan made by the lender is or has become a distressed loan, the lender shall provide a reasonable opportunity for the borrower thereof to personally *78 meet with a representative of the lender [to discuss the loan status, borrower's financial condition and the possibility of restructuring]". * * *
(d)(1) "When a qualified lender receives an application for restructuring from a borrower, the qualified lender shall determine whether or not to restructure the loan, taking into consideration: [costs of restructuring, commitment by borrower of all discretionary income to primary obligations, borrowers financial and management ability, sound lending practices]". * * *
(e)(1) "If a qualified lender determines that the potential costs to a qualified lender of restructuring the loan in accordance with a proposed restructuring plan is less than or equal to the potential costs of foreclosure, the qualified lender shall restructure the loan in accordance with the plan."
Agricultural Credit Act of 1987, Pub.L. No. 100-233, § 102, 101 Stat. 1575.
Subsection (e)2 sets forth the means by which a lender is to compute the costs of restructuring.
The Debtors take the position that restructuring under the Act is an exclusive remedy which prevents an 1111(b) election in the context of bankruptcy. The effect of the Debtors' argument is an implied repeal of section 1111(b) of the Bankruptcy Code and any other Bankruptcy Code provision that impinges upon the Act.
Neither the legislative history accompanying the Act nor case law dealing with statutory interpretation lead to this result. The Act merely provides for a restructuring opportunity and within bankruptcy that opportunity is no more nor less than what would be available to a borrower outside of bankruptcy. Contrary to the Debtors' view, the Act does not in this court's opinion, overrule, repeal or render inoperative any portion of the Bankruptcy Code including section 1111(b). Indeed, Debtors' present counsel made a similar argument in the case of Matter of Dilsaver, 17 B.C.D. 785 (Bankr.Neb.1988), arguing the Act prevented sequestration of rents and profits under section 552 of the Bankruptcy Code. With a broad brush, the Debtors now say that Dilsaver stands for the proposition that the Act applies to creditors in Chapter 11 cases and thereby prohibits creditors from taking advantage of certain Bankruptcy Code afforded remedies. While this court agrees that the Act applies to creditors in bankruptcy cases, it disagrees with the attenuated argument that Dilsaver can be read to mean that the Act truncates the United States Bankruptcy Code. In Dilsaver the court merely held that compliance with the Act is a condition precedent to commencement of foreclosure proceedings. An 1111(b) election is not a foreclosure proceeding but is a remedy available to creditors in bankruptcy.
Whether an 1111(b) election has any vitality in the face of the Act depends upon whether the FmHA, as a qualified lender, has determined under section 4.14A(d)1, to restructure or, whether it is required by section 4.14A(e)1, to restructure. Restructuring under the Act is not mandatory in all instances without taking into account the borrower's personal situation and the lender's restructuring costs. While the event of bankruptcy does not ameliorate the qualified lender's duties to make available and consider restructuring in appropriate instances; on the other hand, the mere duty to consider restructuring does not eliminate Bankruptcy Code remedies unless a particular Code remedy becomes moot by virtue of an independent restructuring determination. The Act itself requires only that a qualified lender provide informed notice and an opportunity for discussion to a borrower and that the lender not commence or continue with a foreclosure until it has completed its determination on the appropriateness of restructuring. The Act does not mandate restructuring unless the qualified lender has determined that the cost of restructuring will be less than or equal to the costs of foreclosure.
The Act impacts upon the Bankruptcy Code remedy of section 1111(b) only if the qualified lender has decided to restructure consistent with section 4.14A of the Act and as a consequence, writes down the borrower's loan to the value of the collateral. *79 Absent a decision to restructure, an 1111(b) election is a viable Bankruptcy Code option available to a qualified lender.
Accordingly, the Debtors' objection to the FmHA's section 1111(b) election is overruled. Any Chapter 11 plan must take into account the fact of the election.
SO ORDERED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919983/ | 180 Mich. App. 465 (1989)
447 N.W.2d 777
ENGINEERED HOUSING CONCEPTS, INC
v.
WAYNE COUNTY
Docket No. 108359.
Michigan Court of Appeals.
Decided June 28, 1989.
Fried & Levitt, P.C. (by David M. Fried and Dennis Watson), for plaintiff.
Samuel A. Turner, Corporation Counsel, and Mary M. Nassar, Assistant Corporation Counsel, for defendants.
Amici Curiae:
*467 Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, and Michael A. Lockman and Joseph M. Binno, Assistant Attorneys General, for the Mobile Home Commission, Corporation and Securities Bureau, Michigan Department of Commerce.
Dykema Gossett (by William J. Perrone and Cindy M. Wilder), for the Michigan Manufactured Housing Association.
Before: GRIBBS, P.J., and MURPHY and NEFF, JJ.
PER CURIAM.
This case involves the question whether defendants had authority to require that plaintiff pave the public road abutting plaintiff's property as a prerequisite to approval of plaintiff's preliminary plan for a mobile home park. Plaintiff appeals as of right from a Wayne Circuit Court order granting defendants' motion for summary disposition and dismissing plaintiff's complaint for a writ of mandamus. We reverse.
Plaintiff owns a thirty-five-acre parcel of land located at the southeast corner of South Huron Road and Clark Road in Huron Township, Wayne County. Plaintiff intended to develop this property as a mobile home park, a permissible use under the Huron Township zoning regulations. As required by the Mobile Home Commission Act, MCL 125.2301 et seq.; MSA 19.855(101) et seq., plaintiff submitted preliminary plans to the township, county and state agencies required to review the plans.
On June 17, 1987, plaintiff received a letter from the Wayne County Office of Public Services requesting the following modifications:
1. Driveway geometrics are to be in conformance *468 with the Wayne County standard for boulevard approaches.
2. Clark Road is to be paved from the site driveway to another paved road as per Wayne County Standards and Procedures for Mobile Home Parks. An excerpt from the Standards is enclosed (fully explaining the requirements) along with a copy of acceptable pavement cross-sections.
3. The Wayne County Master Plan for road right-of-way requires an ultimate width of 120 feet for Clark and S. Huron Roads within the limits of the proposed site frontage. The proprietor will be requested or required to dedicate road right-of-way to the 60 foot line as part of this project. A final determination as to whether or not dedication is required cannot be made until the detailed engineering plans have been submitted for our review and approval. Please contact Mr. Al Naderi at 224-7807 if you have any questions regarding dedication of right-of-way.
Since the Wayne County Road Commission did not approve plaintiff's preliminary plans, no construction permit was issued.
Under the standards adopted by the Wayne County Road Commission, Clark Road was a "public access road" on plaintiff's plans, because it would provide "ingress and egress for the site of the mobile home park." According to those standards, plaintiff may pay for the paving itself, or "may elect to initiate such improvement by the special assessment method." As the lower court stated in its opinion: "In other words, the County of Wayne declines to assume the cost of paving Clark Road." Plaintiff alleged that defendants' modifications would require paving six thousand feet of public road at a cost in excess of $600,000.
Section 11(3) of the Mobile Home Commission Act provides for review of preliminary plans for mobile home parks:
*469 (3) The county drain commissioner shall review and may approve outlet drainage. The county road commission shall review and may approve ingress and egress roads. The county road commission and the county drain commissioner shall adopt and publish standards to implement this subsection. The county road commission and the county drain commissioner shall not have authority as to interior streets and drainage in the mobile home park or seasonal mobile home park, unless the streets or drains are dedicated to the public. [MCL 125.2311; MSA 19.855(111).]
The lower court in this case noted that defendants had authority to regulate and approve ingress and egress roads under § 11, and implicitly ruled that Clark Road was an "ingress and egress road" within the meaning of the statute.
It is axiomatic that a county's authority is derived from and limited by the constitution and valid state statutes. Arrowhead Development Co v Livingston Co Road Comm, 413 Mich 505, 512; 322 NW2d 702 (1982); Gray v Wayne Co, 148 Mich App 247; 384 NW2d 141 (1986), lv den 426 Mich 872 (1986). The county road commission has a broad, general duty to keep all county roads in reasonable repair so that they shall be reasonably safe and convenient for public travel. MCL 224.19-224.21; MSA 9.119-9.121. The county may not discharge its duty by imposing the costs of county road improvements on local developers, absent statutory authority. Arrowhead, 413 Mich 512. Thus, defendants in this case may not condition their approval of plaintiff's preliminary plans on the paving of Clark Road unless Clark Road is an "ingress and egress road" within the meaning of the act.
While the act itself did not define the term "ingress and egress road," it delegated authority to *470 the Mobile Home Commission to promulgate rules and standards for road construction in mobile home parks. MCL 125.2305; MSA 19.855(105). The commission defined "ingress and egress road" as follows:
"Ingress and egress road" means that road which connects a public road with the internal road system of a mobile home park. [1979 AC, R 125.1901(i).]
The construction given to a statute by those charged with the duty of executing it is always entitled to great deference and will not be overturned unless clearly wrong or another construction is plainly required. Breuhan v Plymouth-Canton Community Schools, 425 Mich 278, 282-283; 389 NW2d 85 (1986); Magreta v Ambassador Steel Co, 380 Mich 513; 158 NW2d 473 (1968); ACCO Industries, Inc v Dep't of Treasury, 134 Mich App 316, 322; 350 NW2d 874 (1984), lv den 421 Mich 857 (1985).
It is apparent from the Mobile Home Commission's definition that an "ingress and egress road" is not a public road. We do not believe this definition is clearly wrong or that another construction is plainly required. The Mobile Home Commission's definition is consistent with the legislative purpose of the Mobile Home Commission Act, with the road commission's affirmative duty to keep all county roads in reasonable repair, and with other statutory schemes relating to county roads. E.g. MCL 247.321 et seq.; MSA 9.140(21) et seq., which grants authority to county road commissions to adopt rules regulating any "driveway, lane, road or any other way providing vehicular access to or from the highway from or to property adjoining the highway." The definition is also consistent with the statutory prohibition of local ordinances *471 designed to exclude mobile home parks. MCL 125.2307(3); MSA 19.855(107)(3).
We conclude that the Mobile Home Commission Act does not provide defendants any explicit or implicit authorization to condition issuance of a permit in this case on the paving of a county road. The trial court erred by ruling that defendants had statutory authority to require improvement of Clark Road as a prerequisite for approval of plaintiff's preliminary plan.
Plaintiff also challenges the requirement that it dedicate its property for the eventual widening of Clark Road as a prerequisite for approval of plaintiff's preliminary plan.
Although, as defendants contend, there is a statutory presumption of a sixty-six-foot right of way for a public road created by public user, this presumption may be rebutted by a showing that the actual use of the road does not extend to the statutory width. MCL 224.11; MSA 9.111. Rigoni v Michigan Power Co, 131 Mich App 336; 345 NW2d 918 (1984). When the taking of private property becomes necessary in the "laying out, widening, changing, or straightening of a road," the county must acquire that property by either purchase or condemnation. MCL 224.11-224.12; MSA 9.111-9.112.
We find that defendants exceeded their authority here. A city ordinance which required reservation of property for a proposed road right of way established by the city's master plan has been held by our Supreme Court to be unconstitutional on its face. Gordon v City of Warren Planning & Urban Renewal Comm, 388 Mich 82; 199 NW2d 465 (1972). A government may not use its police power to require a property owner to refrain indefinitely and without payment from using and enjoying his *472 land because it had been set aside for possible future condemnation. Gordon, 388 Mich 91-92.
Reversed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614555/ | 939 So. 2d 644 (2006)
Jacqueline BAZILE
v.
NESTLÉ USA, INC., et al.
No. 06-223.
Court of Appeal of Louisiana, Third Circuit.
September 27, 2006.
Stephen C. Resor, Sullivan, Stolier & Resor, New Orleans, LA, Defendant/Appellee Dolgencorp, Inc.
Jason R. Bonnet Kendra Leigh Duay Leake & Anderson New Orleans, LA Defendant/Appellant Nestlé USA, Inc.
*645 Cory Paul Roy, Marksville, LA, Plaintiff/Appellee Jacqueline Bazile.
Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, JIMMIE C. PETERS, and J. DAVID PAINTER, Judges.
THIBODEAUX, Chief Judge.
This case involves the assessment of damages against a private corporation for failure to fund a settlement within thirty days. The plaintiff, Jacqueline Bazile, sued Nestlé USA, Inc. (Nestlé) after allegedly finding worms in a candy bar manufactured by Nestlé. No insurance companies were involved in the suit. The parties settled the matter for $1,500.00, and the settlement was funded approximately sixty-four days later. However, when the settlement was not funded within thirty days, Bazile filed a motion for enforcement of the settlement and for bad faith damages. The trial court assessed $5,000.00 in bad faith damages against Nestlé pursuant to La.R.S. 22:1220, which governs an insurer's duty to fund a settlement within thirty days from settlement. It is from this judgment, and from a judgment denying a new trial, that Nestlé appeals. We reverse the judgment for the bad faith penalty against Nestlé. It is not an "insurer" within the meaning of La.R.S. 22:1220.
I.
ISSUES
We must decide whether the trial court erred in applying the thirty-day time restriction of La.R.S. 22:1220 to a settlement not involving an insurer.
II.
FACTS AND PROCEDURAL HISTORY
On July 12, 2004, Bazile sued the Nestlé corporation and Dolgencorp, Inc. after allegedly discovering worms in a candy bar that she had purchased from a Dollar General store in December 2003. Dolgencorp, Inc. was subsequently dismissed. No insurance companies were named in the suit or involved in the litigation.
On December 6, 2004, Nestlé accepted the counteroffer from Bazile to settle the suit for $1,500.00 and faxed a letter to Bazile confirming the amount. The letter agreed to "pay plaintiff $1,500, inclusive of medical specials and court costs, in exchange for a full and final dismissal of all claims against Nestlé USA, Inc." The letter also requested a tax identification number (TIN) from Bazile's attorney for the funding of the settlement. The parties had previously agreed that Nestlé would pay the court costs in addition to the settlement amount. Therefore, this letter of December 6, 2004, inaccurately reflects that the amount of $1,500.00 includes and settles all damages and all court costs. Bazile did not respond to this mistake but later argued that the settlement was confected in this letter of December 6, 2004. Bazile also did not respond to the request for the TIN.
On December 8, 2004, Nestlé forwarded a Receipt and Release and Motion to Dismiss and again requested the TIN for the settlement. Bazile did not respond to this correspondence, even though the enclosed dismissal again failed to reflect that court costs would be paid by Nestlé.
As of January 7, 2005, Nestlé had not received the signed settlement documents. On this date, Nestlé forwarded correspondence requesting the executed copies of the Receipt and Release and also requesting the TIN for a third time.
On January 12, 2005, Bazile wrote Nestlé, acknowledging the January 7, 2005 correspondence and enclosing the executed *646 Receipt and Release. However, at this time Bazile requested a revised Motion to Dismiss that reflected the parties' agreement that all costs would be paid by Nestlé. Counsel for Bazile did not ask about the settlement check, nor did he provide his TIN as requested for the settlement. Counsel for Nestlé obtained the TIN of counsel for Bazile by phone and wrote it on the January 12, 2005 correspondence. Nestlé would later argue that the settlement was confected no earlier than January 12, 2005.
On January 21, 2005, Bazile wrote Nestlé, enclosing the executed revised Motion to Dismiss reflecting that all costs would be borne by Nestlé.
On January 27, 2005, counsel for Nestlé inadvertently filed the Motion to Dismiss before funding the settlement. The record indicates that the Nestlé corporation's third-party claims administrator transferred the file to another office and that this transfer contributed to miscommunications between the attorney's office and the claims office and contributed to some delay in confecting the settlement check.
On January 29, 2005, Bazile filed a motion to enforce the settlement and requested damages for bad faith handling of the settlement pursuant to La.R.S. 22:1220. The motion to enforce was ostensibly filed to protect Bazile's interests in light of the premature filing by Nestlé of the motion to dismiss.
On February 4, 2005, Nestlé cut the settlement check for $1,500.00 and, upon receipt of same, counsel for Nestlé sent the check by Federal Express to counsel for Bazile. Accompanying the check was correspondence dated February 7, 2005. The correspondence contained an apology for the premature filing of the Motion to Dismiss before sending the settlement check which prompted the filing of the motion to enforce. The correspondence also confirmed in writing a verbal agreement wherein counsel for Bazile agreed to withdraw the motion to enforce upon receipt of the settlement check. At the hearing, counsel for Bazile did not deny the agreement to withdraw the motion to enforce but attempted to discount it by indicating that there was no proof of the agreement.
On April 26, 2005, Bazile filed a motion to reopen the case for submission of additional evidence. Counsel for Bazile asserted that he hand wrote a response on Nestlé's first offer to settle wherein Bazile made the counteroffer of $1,500.00, and that this letter was inadvertently omitted from the exhibits. The trial court granted the motion, and after a hearing on May 16, 2005, the court accepted the letter with the handwritten response.[1] While there is confusion in the record regarding the date of this letter with the handwritten response, the letter is of no moment. The December 6, 2004 letter from Nestlé, which is in the record, without any response, confirms the previous counteroffer of $1,500.00, and there are no allegations of a confected settlement prior to December 6, 2004.
The trial court found in favor of Bazile and assessed a $5,000.00 penalty against Nestlé pursuant to La.R.S. 22:1220 for failure to fund the settlement within thirty days from December 6, 2004.
On June 27, 2005, Nestlé filed a motion for a new trial based upon La.Code Civ.P. arts.1971 and 1972(1), on the grounds that the judgment was contrary to the law and the evidence. In its supporting memorandum, Nestlé argued for the first time that it was not an insurer and, therefore, not subject to La.R.S. 22:1220 or its thirty-day *647 limitation on funding a settlement. Nestlé has continued to maintain that, despite the inapplicability of the statute, the settlement was funded timely under La.R.S. 22:1220, where the settlement was not confected until January 12, 2005, and the settlement was funded on February 9, 2005. Nestlé further argues that La.R.S. 22:1220 is inapplicable because Nestlé never knowingly held the check.
III.
LAW AND DISCUSSION
Whether Nestlé Is an Insurer under La.R.S. 22:1220
Nestlé contends that the trial court erred in applying the thirty-day time restriction of La.R.S. 22:1220 to the Nestlé settlement in this case where Nestlé is not an insurer under the meaning of that statute. We agree. Louisiana Revised Statutes 22:1220 is a penal statute and must be strictly construed. Bennett v. State Farm Ins. Co., 03-1195 (La.App. 3 Cir. 3/24/04), 869 So. 2d 321. It provides in pertinent part:
La.R.S. 22:1220. Good faith duty; claims settlement practices; cause of action; penalties
A. An insurer, including but not limited to a foreign line and surplus line insurer, owes to his insured a duty of good faith and fair dealing. The insurer has an affirmative duty to adjust claims fairly and promptly and to make a reasonable effort to settle claims with the insured or the claimant, or both. Any insurer who breaches these duties shall be liable for any damages sustained as a result of the breach.
B. Any one of the following acts, if knowingly committed or performed by an insurer, constitutes a breach of the insurer's duties imposed in Subsection A:
(1) Misrepresenting pertinent facts or insurance policy provisions relating to any coverages at issue.
(2) Failing to pay a settlement within thirty days after an agreement is reduced to writing.
(3) Denying coverage or attempting to settle a claim on the basis of an application which the insurer knows was altered without notice to, or knowledge or consent of, the insured.
(4) Misleading a claimant as to the applicable prescriptive period.
(5) Failing to pay the amount of any claim due any person insured by the contract within sixty days after receipt of satisfactory proof of loss from the claimant when such failure is arbitrary, capricious, or without probable cause.
. . . .
C. In addition to any general or special damages to which a claimant is entitled for breach of the imposed duty, the claimant may be awarded penalties assessed against the insurer in an amount not to exceed two times the damages sustained or five thousand dollars, whichever is greater. Such penalties, if awarded, shall not be used by the insurer in computing either past or prospective loss experience for the purpose of setting rates or making rate filings.
Nestlé cites Thibodeaux v. Stapp Towing Co., Inc., 96-1511, 96-1514 (La. App. 3 Cir. 8/27/97), 702 So. 2d 693, where the trial court awarded punitive damages to the plaintiffs under La.R.S. 22:1220, after the defendant towing company's vessel drifted into the plaintiffs' pleasure craft and dock. In reversing the trial court, a panel of this court held that the statute imposing a duty of good faith and fair dealing upon an insurer and prescribing penalties for violating this duty did not *648 permit an award of punitive damages against the defendant, who was not an insurer. More specifically, after making it clear that the award of negligence damages was not at issue, but rather the only issue was whether the trial court erred as a matter of law in assessing a penalty under La.R.S. 22:1220, the panel articulated as follows:
The gist of defendant's argument is that because it is not an insurer, it should not have been held liable for punitive or exemplary damages, as the penal provisions of La.R.S. 22:1220[2] explicitly imposes [sic] both the duty and the penalties only against insurers. As defendant points out, La.R.S. 22:1212 defines the term "insurer" as follows:
§ 1212. Definitions
C. "Insurer" means any person, reciprocal exchange, interinsurer, Lloyds insurer, fraternal benefit society, or any other legal entity engaged in the business of insurance, including insurance agents, insurance brokers, surplus lines brokers, and insurance solicitors. Insurer shall also mean medical service plans, hospital service plans, health maintenance organizations, and prepaid limited health care service plans. For the purposes of this Part, these foregoing entities shall be deemed to be engaged in the business of insurance.
In view of the fact that there is no question but that defendant is not and never has been alleged to be an insurer within the purview of La.R.S. 22:1212, we are compelled to reverse the judgment of the trial court. When a statutory or codal provision enacted by the Louisiana Legislature is clear and unambiguous, its letter shall not be disregarded under the pretext of pursuing its spirit; rather, the law is to be applied as written and no further interpretation may be made in search of the intent of the legislature. La.Civ.Code art. 9; La. R.S. 1:4. La.R.S. 22:1220, particularly when read in conjunction with La.R.S. 22:1212(C), only imposes upon insurers the duty to settle upon pain of penalties, and the trial court erred in holding to the contrary, for the law of Louisiana is clear insofar as it provides that a party cannot recover damages for failure to settle a case, except in the limited circumstances provided by statute. Yoes v. Shell Oil Co., 95-12 (La.App. 5 Cir. 5/10/95); 657 So. 2d 241, writ denied, 95-2087 (La.11/17/95); 663 So. 2d 714; Guillory v. Gulf South Beverages, Inc., 506 So. 2d 181 (La.App. 5 Cir.1987).
In this case, plaintiffs can allude to no legal authority by which defendant, neither an insurer nor a health provider, can be held answerable for more than the damages occasioned by its delict.
Id. at 694.[3]
Nestlé also cites Rawls v. City of Bastrop, 38,449 (La.App. 2 Cir. 5/12/04), 873 So. 2d 934. In this property damage case, the plaintiffs filed suit against the City of Bastrop, claiming that paint overspray from the negligent painting of a municipal building damaged their vehicle. The trial court found the city liable for damages, penalties, and attorney fees. The city appealed and argued that the trial court erred in awarding inappropriate damages and in awarding penalties and attorney fees. The appellate court affirmed the damage award, but reversed *649 the award of penalties and attorney fees, stating as follows:
The City's second issue on appeal is whether the trial court erroneously awarded penalties and attorney fees. On this issue, the City argues that it is a member of the Louisiana Municipal Association Risk Management Agency ("LMARMA") and part of a self-insurance fund. The City further argues that there is a distinct difference between a regular insurance company and the LMARMA. In support of this argument, the City cites the provisions of La.R.S. 33:1345, which state in pertinent part that an interlocal risk management agency is not an insurance company or an insurer under the laws of Louisiana, and that the development and administration by such agency of one or more group self-insurance funds shall not constitute doing insurance business.
In opposition to this argument, the plaintiffs assert that the record in this matter does not reflect that the City is anything other than a self-insured entity. They also argue that the trial court did not indicate that the City was an insurance company, but that the court simply likened the City to any other self-insured company, and that because of the untimely manner in which the City satisfied its liability in this case, the court concluded it was appropriate to sanction the City as though it were an insurance company. In this regard, the plaintiffs argue that the duties of good faith and fair dealing incumbent upon insurers pursuant to the provisions of La.R.S. 22:658 and 22:1220 should also apply to self-insurers.
Id. at 937.
After reviewing the statutory provisions, the court in Rawls disagreed with the plaintiffs, quoting La.R.S. 22:1220(A) and (C) and stating as follows:
The above-quoted provisions are found in Part 26 of Chapter 1 of the Louisiana Insurance Code. Part 26, entitled "Unfair Trade Practices," is designed to regulate the trade practices in the business of insurance, in accordance with federal law, by defining or providing for the determination of all acts, methods, and practices which constitute unfair methods of competition and unfair or deceptive acts and practices in this state, and to prohibit the same. La.R.S. 22:1211.
Id. at 938.
After quoting the definition of an insurer pursuant to La.R.S. 22:1212(C), as did this court in Thibodeaux, the Rawls court stated as follows:
As we held in Block v. St. Paul Fire & Marine Ins. Co., 32,306 (La.App.2d Cir.9/22/99), 742 So. 2d 746, statutes requiring timely payment of claims and imposing a duty of good faith and fair dealing are penal in nature and, therefore, must be strictly construed. Even without the definition of "insurer" quoted above, a strict interpretation of the word "insurer" would not include the City in the instant case. . . . [T]he above-quoted definition of "insurer" plainly shows that the legislature intended to include only those entities engaged in the business of insurance; the City is not in the insurance business. Accordingly, the City is not an "insurer" for purposes of La.R.S. 22:1220.
Because the penal provisions of this statute must be strictly construed, they cannot be applied by analogy to the City when the City does not fall within the plain reading of the words of the statute. Thibodeaux v. Stapp Towing Co., 96-1514 (La.App. 3d Cir.8/27/97), 702 So. 2d 693. Moreover, because the City is not an insurer, we also find inapplicable the *650 penalty and attorney fee provisions of La.R.S. 22:658.
Id. at 939.
Accordingly, based upon the foregoing, we find that the trial court erred as a matter of law in finding that Nestlé was an insurer under Title 22 and in assessing a $5,000.00 penalty under La.R.S. 22:1220 for failure to fund a settlement within thirty days. Because we find La.R.S. 22:1220 inapplicable, we need not address whether the settlement was reduced to writing on December 6, 2004, as Bazile argues, or on January 12, 2005, as Nestlé argues.
Nestlé has further contended that the trial court erred in finding that the thirty-day limitation on funding the Nestlé settlement began to run before counsel for Bazile supplied his TIN to counsel for Nestlé. Again, since we find that La.R.S.22:1220 is inapplicable to Nestlé in the present case, it is likewise not necessary to address the issue of the TIN or the issue of the denial of Nestlé's motion for a new trial.
IV.
CONCLUSION
Based upon the foregoing, the judgment of the trial court is reversed. Costs of this appeal are to be borne by plaintiff-appellee, Jacqueline Bazile.
REVERSED AND RENDERED.
PAINTER, Judge, concurs and assigns written reasons.
PAINTER, Judge, concurs.
Were it possible under the law, I would affirm the trial court's judgment assessing Nestlé with penalties. However, the law as written allows Nestlé avoid the consequences of its failure to pay by self-insuring. Under the existing law no result other than that reached by the majority is possible. Basically, the law provides no penalty where a self-insured defendant fails to pay a plaintiff after settlement. Even worse, if the defendant has a shadow insurer that does not appear on the surface, the same result can occur. In this case, there is no evidence that Nestlé is anything other than self-insured and La. R.S. 22:1220 must be strictly construed. It may be that this problem is one which should be corrected by the legislature. As a result, I concur in the result reached by the majority.
NOTES
[1] This letter does not appear in the record.
[2] Louisiana Revised Statutes 22:1220 was amended by 2006 La. Acts No. 12, § 1; however, the amendment does not affect the issues addressed in this opinion.
[3] Judge Thibodeaux dissented in Thibodeaux. He has now abandoned his contrary position. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920102/ | 91 B.R. 143 (1988)
In re The SECURITIES GROUP 1980, Debtor.
Louis LOWIN, Trustee of the Estate of The Securities Group 1980, Plaintiff,
v.
DAYTON SECURITIES ASSOCIATES, Defendant and Third Party Plaintiff,
v.
Kenneth T. KALTMAN, et al., Third Party Defendants.
Bankruptcy Nos. 84-428-BK-J-GP, 84-431-BK-J-GP and 84-433-BK-J-GP, Adv. Nos. 85-214, 87-303 to 87-305.
United States Bankruptcy Court, M.D. Florida, Jacksonville Division.
August 9, 1988.
*144 Daniel P. Levitt, Kramer, Levin, Nessen, New York City.
Gregory C. Horn, Keltner & Schreiber, Los Angeles, Cal.
Lewis A. Grafman, Busch, Grafman & von Dreusche, Bala Cynwyd, Pa.
Arthur Olick, Anderson, Russell, Kill & Olick, P.C., New York City.
Ira Rubin, Goldman, Rubin & Shapiro, Dayton, Ohio.
Philip A. Kantor, Mangone & Schnapp, New York City.
Gruen, Muskin & Thau, New York City.
Birch, Horton, Bittner, Pestinger & Anderson, Washington, D.C.
Booth, Prichard & Dudley, McLean, Va.
Guy R. Fairstein, Summit, Rovins & Feldesman, New York City.
Christopher Sanger, Washington, D.C.
Finley, Kumble, Wagner, Heine, Underberg & Manley, New York City.
Sheldon Lowe, Botein, Hays & Sklar, New York City.
Larry B. Pedowitz, Wachtell, Lipton, Rosen & Katz, New York City.
Roy F. Babitt, Anderson, Russell, Kill & Olick, New York City.
Philip Tierney, McGuire, Woods, Battle & Boothe, Alexandria, Va.
Deborah A. Reperowitz, Anderson, Russell, Kill & Olick, P.C., New York City.
Jonathon H. Alden, Hall, Estill, Hardwick, Gable, Collingsworth & Nelson, Inc., Tulsa, Okl.
Norman S. Buckvar, McCarthy, Lebit, Crystal & Haiman Co., L.P.A., Cleveland, Ohio.
Robert L. Young, Carlton, Fields, Ward, Emmanuel, Smith & Cutler, Orlando, Fla., for Kaltman et al.
Glenn E. Stern, Stern, Cook & Naiditch, Monrovia, Cal.
Richard M. Estes, Christy & Viener, New York City.
Stephen L. Black, Graydon, Head & Ritchey, Cincinnati, Ohio.
James J. Gross, Amram and Hahn, P.C., Washington, D.C.
George L. Cass, Buchanan Ingersoll P.C., Pittsburg, Pa.
John R. Serpico, Brooklyn, N.Y.
Lawrence L. Pedley, Pedley, Ross, Ziekle & Gordinier, Louisville, Ky.
David Dunn, Davis, Markel, Dwyer & Edwards, New York City.
William E. Kuntz, Smith & Hulsey, Jacksonville, Fla.
Stewart E. Bland, Louisville, Ky.
Jonathan R. Mook, Hirkschkop & Associates, Alexandria, Va.
Jonathan A. Chandler, Sutherland, Asbil & Brennan, Atlanta, Ga.
David B. Newman, Fine, Tofel, Saxl, Berelson, New York City.
John B. MacDonald, Brant, Moore, Sapp, MacDonald & Wells, P.A., Jacksonville, Fla.
Richard P. Swanson, Spengler, Carlson, Gubar, New York City.
Paul R. Hejmanowski, Kionel, Sawyer & Collins, Las Vegas, Nev.
Lane & Mittendorf, New York City.
Glenn B. Rice, Otterbourg, Steindler, Houston & Rosen, New York City.
MEMORANDUM OPINION
GEORGE L. PROCTOR, Bankruptcy Judge.
These consolidated adversary proceedings are before the Court on plaintiff's motion for partial summary judgment as to the first cause of action against the defendants on the limited issue of liability for the return of all consideration received by the defendants in connection with the sale of their partnership interests. Also before the court is defendants' cross-motion for summary judgment on the first cause of action. A hearing on the motions was held *145 July 15, 1988, after the submission on written memoranda of law. Upon consideration, the Court will hold in favor of plaintiff and grant his motion for partial summary judgment as to the first cause of action. The Court will deny the summary judgment motion of the defendants.
BACKGROUND
This case arises out of the defendants' investment in The Securities Group ("TSG"), The Monetary Group ("TMG") and The Securities Group 1980 ("TSG80") (the "Partnerships"). The Partnerships were three New York limited partnerships formed by Charles Agee Atkins ("Atkins"). The Securities Groups ("Groups") was a general partnership comprised of the Partnerships as general partners. Among other things, Groups was a broker-dealer that invested in United States government securities. The four partnerships are now in bankruptcy and the plaintiff, Louis Lowin, is the Post-Confirmation Administrator and former Chapter 11 Trustee of all four bankruptcy estates.
The parties do not dispute that defendants purchased interests in the Partnerships and made initial capital contributions in varying amounts.
Groups began its operations as a "joint operating account" which coordinated the activities of TSG and TMG prior to the formation of TSG80. After its formation, TSG80's activities were also coordinated through Groups. Atkins and others who acted as the management of Groups were also responsible as general partners for the management of the Partnerships and ran their operations out of New York City. As the general partners of Groups, the Partnerships are jointly liable for the debts incurred by Groups. See New York Partnership Law, Section 26(2) [McKinney's Partnership Law, Book 38, Article 3, 1948], which provides that all partners are jointly liable for the debts and obligations of a partnership.
Sometime prior to autumn of 1982, it became apparent that changes in the tax laws would no longer permit broker-dealers such as Groups to continue to defer income from year to year as had previously been the practice. These changes in turn translated into adverse tax consequences for the limited partners, as they would now be required to recognize theretofore unrecognized income of the Partnerships and pay taxes on that income without receiving equivalent cash distributions in an amount adequate to pay the taxes.
To offset these potential tax liabilities, Atkins began to arrange a sale of the limited partners' interests. One of the options explored was the merger of the Partnerships with an entity having large tax loss carryovers. However, by mid-1982, the managers settled upon the idea of selling the limited partners' interests to a new partnership to be comprised of Group's managing partners. Consequently, a new partnership was formed and named TSG Partners.
On November 15, 1982, TSG Partners made a tender offer for all the interests of the limited partners in the Partnerships. TSG Partners offered as consideration for these interests and amount equal to 105% of the net asset value of the Partnerships as of September 30, 1982.
The defendants accepted the tender offer and thereafter sold their interests to TSG Partners. The sale was consummated and on April 1, 1983, the defendants received cash and promissory notes for their interests.
TSG Partners subsequently became insolvent and filed a petition under Chapter 11, Title 11, of the United States Code. Its chief general partner, Charles Agee Atkins, also filed a Chapter 11 petition.
Subsequent to defendants' purchase of their limited partnership interests and their contribution of capital, the Partnerships and Groups were indebted to various creditors. Many of those creditors were unpaid at the time defendants received a return of their capital contributions through the sale of their limited partner interest to TSG Partners and remain unpaid today.
Plaintiff, as Post-Confirmation Administrator, has filed this and other related adversary proceedings seeking to recover for the bankruptcy estates a return of the limited partners' capital contributions which they received under the terms of the tender offer and, secondly, to compel the limited partners to honor their commitment to make additional capital contributions to the Partnerships. Although the Post-Confirmation Administrator has settled a number of these related proceedings, these consolidated actions remain pending. This proceeding is now before the Court upon the plaintiff's motion for partial summary judgment as to the first cause of action.
*146 SCOPE OF PLAINTIFF'S MOTION
In his amended complaint, plaintiff has asserted two causes of action. The first is based primarily upon Section 106(4) of the New York Limited Partnership Law [McKinney's Partnership Law, Book 38, Article 8] (the "Act"). Plaintiff contends that this statute creates an obligation on the part of defendants to return to the Partnership the consideration they received in exchange for their partnership interests under the terms of the tender offer made by TSG Partners. Section 106(4) provides:
When a creditor has rightfully received the return in whole or in part of the capital of his contribution, he is nevertheless liable to the partnership for any sum, not in excess of such return with interest, necessary to discharge its liabilities to all creditors who extended credit or whose claims arose before such return.
In addition to arguing that defendants are liable for the consideration received in the form of cash and notes from TSG Partners, plaintiff also claims that Section 106(4) dictates that defendants honor their commitments to the Partnerships to contribute additional capital to the extent necessary to pay existing creditors of the Partnerships.
The second cause of action which is not part of the motion is based upon the Certificate of Limited Partnership to which defendants subscribed when they purchased their partnership interests. Plaintiff argues that under its terms, the defendants are obligated to make additional capital contributions up to three times their initial capital commitments if necessary to pay the recourse obligations of the Partnerships.
In his motion for summary judgment, plaintiff seeks a determination that defendants are liable under the first cause of action in an amount, not to exceed the shortfall in the Partnerships' obligations, equal to the cash and principal amount of the notes received in the tender offer, plus interest. Since the amount of creditor's claims against the Partnerships has not been finally determined, plaintiff's motion is limited solely to the issue of liability. The issues of additional capital contributions, recourse obligations and the actual amount of defendants' liability are not presently before the Court.
DISCUSSION
Plaintiff's argument is premised upon the conclusion that the sale by defendants of their partnership interests amounted to a "return of capital" within the meaning of New York Partnership Law Section 106(4) and that defendants must now return for the benefit of unpaid creditors the consideration they received in the tender offer.
Thus, the first issue to be addressed is whether the sale of a limited partnership interest amounts to a "return of capital." Whitley v. Klauber, 51 N.Y.2d 555, 435 N.Y.S.2d 568, 416 N.E.2d 569 (1980), appears to be a case on point. There, the New York Court of Appeals held that, for purposes of Section 106(4), the sale of a partnership interest pursuant to a tender offer does indeed amount to a return of capital. Said the Court:
. . . As to the Partnership Law, six of us agree that the strong policy enunciated by Section 106 permitting a creditor who was such when a limited partner's capital was returned to him to recover from the limited partner to the extent of the capital returned, with interest, even though return of the capital was entirely proper, mandates the conclusion that a transaction or series of transactions in which all general and limited partners dispose of their interest in the limited partnership leaving a creditor unpaid constitutes a return of capital notwithstanding that in form it is the sale of the limited partners' interest.
51 N.Y.2d at 560, 435 N.Y.S.2d 568, 416 N.E.2d 569.
In reaching its conclusion, the Court determined that the effect upon creditors is the decisive factor in whether a specific transaction amounts to a return of capital. Explained the Court:
[P]rimary in the determination whether a particular transaction constitutes a return of capital is not the limited partner's purpose or intent but its effect upon partnership creditors.
51 N.Y.2d at 563, 435 N.Y.S.2d 568, 416 N.E.2d 569.
Here, the defendants received cash and promissory notes in exchange for their partnership interests. However, the net effect of these transactions upon partnership creditors appears to be a reduction in the amount of capital left to satisfy their claims.
*147 Whitley v. Klauber makes it clear that the fact that the limited partners sold their interests to a third party rather than receiving a direct return of capital from the Partnerships would not alter this finding. This Court finds that the promissory notes defendants received constitute a return of capital contributions as much as did the cash. Both of these issues were raised in Whitley and were summarily dismissed. Said the Court:
On the basis of that overriding purpose, we and other courts have held limited partners liable under subdivision (4) of section 106 notwithstanding the absence of fraud, the fact that property other than cash is received by the limited partner or the fact that the transaction takes the form of a sale of limited partners' interests to a third-party, rather than a distribution by the partnership itself.
51 N.Y.2d at 563, 435 N.Y.S.2d 568, 416 N.E.2d 569. The Court went on to add:
Receipt by the limited partners of property (here Bermec stock) rather than cash does not change the result. While subdivision (3) of section 105 of the Partnership Law restricts a limited partner to receipt of cash for his contribution unless the partnership certificate states otherwise or all members consent, that provision has no bearing upon the interpretation of subdivision (4) of section 106, intended as it is to protect creditors.
51 N.Y.2d at 565, 435 N.Y.S.2d 568, 416 N.E.2d 569.
Several older cases stand for the proposition that notes given by the general partner or by an outside third party to a limited partner constitute a return of capital. For example, in Beers v. Reynolds, 11 N.Y. 97 (1853), the Court held that a limited partner who had sold his interest to a general partner by taking back a note secured by a chattel mortgage on both partnership property and property of the general partner had received a return of capital. Similarly, in Neil v. United States, 195 F.2d 336 (5th Cir.1952), a transaction in which a general partner used cash, his own personal assets and his own promissory note to buy out the limited partners was found to be a return of capital.
As these cases were cited with approval by the Court of Appeals in Whitley, the Court must view them as the clearest and most recent statement of New York law. In their cross-motion the defendants cite several old lower New York court decisions [George v. Carpenter, 25 N.Y.S. 1086 (N.Y. Sup.Ct.1893), aff'd 147 N.Y. 686, 42 N.E. 723 (App.Div.1895); Lachaise v. Marks, 4 E.D. Smith 610 (Common Pleas 1855)] in arguing that the notes should not be considered a return of capital. However, the Court finds that the rationale of Klauber effectively overrules those cases. Hence, the full amount received by the defendant in the tender offer, both cash and notes, is subject to being refunded under Section 106(4) of the Act.
The fact that the notes eventually became worthless due to TSG Partner's inability to pay does not change the result. The notes were considered valuable when accepted by the limited partners and its present worth has little relevance to the question now. This same conclusion was reached in Whitley. There, the limited partners received stock in a third party corporation in exchange for their limited partnership interests. Like the situation here, the corporation in that case eventually went bankrupt and the stock became worthless. However, the court considered this fact to be immaterial as the stock was considered valuable consideration at the time it was accepted by the limited partners and the subsequent misfortunes of the corporation had no bearing on their characterization as a return of capital.
In actions to recover a return of capital contributions under Section 106(4), there is no need to prove an evil intent. Specifically, Section 106(4) has no requirement that the return of capital be fraudulent, wrongful or designed to deceive creditors in order to be avoided. Instead, it simply speaks in terms of returned capital which is "rightfully received." Other sections such as Section 106(2)(a) and (b) of the Act were designed to deal with situations in which the contribution of capital was wrongfully returned. Therefore, the Court concludes that the plaintiff need not prove fraud or other wrongdoing in connection with the tender offer in order to recover from the defendants.
Additionally, for purposes of Section 106(4), it does not matter that there may have been sufficient capital remaining in the partnership after the withdrawal to pay all then existing creditors. If the remaining capital becomes depleted at any time after the withdrawal, the withdrawing limited partners must reimburse the partnership so that it may pay creditors who existed at the time of the withdrawal. See *148 Kittredge v. Langley, 169 N.E. at 631; Whitley v. Klauber, 51 N.Y.2d at 563-64, 435 N.Y.S.2d 568, 416 N.E.2d 569. In view of the pronouncements of these New York cases, the court again rejects defendants' contention that the notes did not constitute a return of capital because there was no actual payment made on them.
Also, by virtue of Section 108(7) of the New York Partnership law the defendants are not relieved of liability because they assigned their interests to TSG Partners. Section 108(7) of the Act states:
The substitution of the assignee as a limited partner does not release the assignor from liability to the partnership under sections ninety-five and one hundred and six.
This statute has been held to apply to assignments of interest pursuant to a tender offer. See Whitley v. Klauber, supra.
The defendants have argued that Whitley is inapplicable to the present action as some of the limited partners have chosen to retain their interests rather then to tender their interests pursuant to the tender offer. The Court finds, however, that to accept such an argument would be putting form ahead of substance. Therefore, the Court concludes that the sale of the vast majority of the partnership interests is tantamount to a complete bail out of the limited partners.
Obviously, the New York courts are far more concerned with the protection of creditors than with the protection of limited partners who had received a return of their capital. For instance, in Whitley the Court said:
That the purpose of the subdivision is the protection of creditors is crystal clear not only from the explicit reference to "creditors who extended credit or whose claims arose before such return" but also from the imposition of liability under its provision even though the contributor has "rightfully received the return."
Whitley echoes the sentiments expressed in Kittredge v. Langley, 252 N.Y. 405, 169 N.E. 626 (1930), wherein Justice Benjamin Cardozo stated:
[A] special [limited] partner is liable, to the extent of his withdrawn capital for the payment of a partnership liability, where the assets left with the general partners irrespective of their valuation at the time of dissolution, are thereafter found to be inadequate.
* * * * * *
We think his obligation to creditors to the extent of his limited liability can be discharged by nothing less than payment.
. . . The special partner does not relieve himself of liability by withdrawing his contribution. He remains liable as before, though as before his liability is limited.
. . . The conclusion is hardly thinkable that the special partner may keep the cash, and leave the creditors with nothing. His contribution, like the capital of a corporation, and to a similar extent, is to be treated as a trust fund for the discharge of liabilities.
. . . The special partner insists that the risk of change was on the creditors. We think it was on him.
Id. 169 N.E. at 631.
This Court will defer to the wisdom of the New York Court and will follow its precedence by imposing liability upon the defendants.
Plaintiff contends that the present action is not barred by the three year statute of limitations applicable to liabilities created by statute, Section 214(2) New York Civil Practice Law and Rules (McKinney's Book 17B) [C.P.L.R. 214(2)], or any other statute of limitations. Plaintiff points out that the only case that has addressed the applicable limitations period for a claim under Section 106(4) is again Whitley v. Klauber.
There, the Court of Appeals upheld the lower court decision which squarely held that the statute of limitations under Section 106(4) of the Act does not begin to run until the creditor has obtained a judgment. Said the Court:
Respondents contend that the present claim is barred by the statute of limitations, asserting that plaintiff's cause of action accrued either in August 1966 when BWF distributed the Bermec stock to the limited partners, or no later than March 1971, when Bermec filed for reorganization under bankruptcy laws. However, in order for plaintiff to proceed against the limited partners, it would be necessary for him to establish the unavailability of partnership assets to satisfy his claim. This did not occur until conclusion of the prior litigation against the partnership and its corporate general partner when judgment in that action was entered March 7, 1977.
Whitley v. Klauber, 417 N.Y.S.2d 959, 965, 69 A.D.2d 99 (1st Dept.1979).
*149 Here, a determination has been made as to the validity of only six claims, the earliest of which was allowed on September 11, 1986. Thus, if C.P.L.R. 214(2) is the applicable statute of limitation, it will not expire until September 11, 1989. The Court concludes, therefore, that plaintiff's action is not time barred under C.P.L.R. 214(2) or any other statute of limitations.
The Court finds that New York law is abundantly clear on the issues thus presented. The policies embodied in Section 106(4) and Section 108(7) of the Act mandate that creditors be protected from limited partners who would bail out of the partnership when prospects of financial demise appear on the horizon.
Plaintiff contends that the Whitley decision mandates that he be granted partial summary judgment as to the first cause of action on the issue of liability under Section 106(4) upon showing that the following facts are not in dispute: (1) defendants were limited partners of the Partnerships and made capital contributions to the Partnerships; (2) defendants subsequently received a return of their capital contributions by means of a tender offer; (3) at the time defendants received a return of their capital contributions, there existed creditors of the Partnerships; and (4) creditors of the Partnerships who existed at the time the defendants received a return of their capital contributions remain unpaid today.
Plaintiff's contention is borne out by the language of the Whitley decision, wherein the court states:
What a limited partner will be permitted to contest in an action by a partnership against which a judgment establishing its liability to a creditor has been obtained is only whether he is in fact a limited partner, whether he received a return of capital, whether the judgment creditor was one whose claim arose before that return, and whether the amount sought by the partnership as return of capital was necessary to discharge the partnership liability (that is, whether the partnership had other means for discharging the liability).
51 N.Y.2d at 571, 435 N.Y.S.2d 568, 416 N.E.2d 569.
As plaintiff has moved for summary judgment as to the first cause of action on the issue of liability only, it is not now necessary to show the final element mentioned above, that is, that the return of capital is necessary because the Partnerships will have no other means to pay creditors. That issue is better left until a final determination can be made regarding claims against the Partnerships' bankruptcy estate. Thus, plaintiff's motion is limited in scope to a determination that defendants will be liable as limited partners for the shortfall between assets of the Partnerships and claims of creditors that are eventually allowed in bankruptcy, subject only to the amount of returned capital contributions plus interest.
The documentary evidence before the Court in affidavits and exhibits leaves no doubt that the elements the plaintiff must prove are no longer at issue in this case. Indeed, defendants have stipulated away most of the facts which would establish their defenses, to wit:
1. the defendants were limited partners of the Partnerships and made capital contributions to the Partnerships;
2. the defendants subsequently received a return of their capital contributions by means of a tender offer;
3. At the time that the defendants received a return of their capital contributions, there existed creditors of the Partnerships; and
4. The creditors of the Partnerships who existed at the time defendants received a return of their capital contributions remain unpaid today.
Defendants have failed to muster adequate evidence to rebut the conclusion that there remain no material issues of fact regarding the present motion. Accordingly, the Court finds that the motion for summary judgment as to the first cause of action should be granted as to the defendants' liability only. For the reasons above stated the Court also finds that defendants' motion for summary judgment should be denied.
The Court will enter a separate order in accordance with this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3038946/ | United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 05-3061
___________
United States of America, *
*
Appellee, * Appeal from the United States
* District Court for the District
v. * of Minnesota.
*
Jesus Ivan Romero, * [UNPUBLISHED]
*
Appellant. *
___________
Submitted: November 15, 2005
Filed: November 22, 2005
___________
Before WOLLMAN, FAGG, and MELLOY, Circuit Judges.
___________
PER CURIAM.
The Government charged Jesus Ivan Romero with a drug conspiracy and a
firearm offense. In a tentative plea agreement, Romero agreed to plead guilty to the
firearm charge and testify truthfully against other suspects in exchange for dismissal
of the conspiracy charge. After Romero refused to testify, however, the Government
withdrew the offer to drop the conspiracy charge. Concluding Romero did not fulfill
the plea offer’s conditions, the district court* rejected Romero’s motion for specific
enforcement. Without reserving his right to appeal the district court’s denial of his
*
The Honorable David S. Doty, United States District Judge for the District of
Minnesota.
motion to compel specific performance, Romero pleaded guilty to a different charge:
aiding and abetting a drug transaction. The district court sentenced Romero to 151
months in prison.
On appeal, Romero claims he is entitled to specific performance of the
withdrawn plea offer, despite his refusal to accept its terms. Romero waived this
claim by his unconditional guilty plea to a different charge. United States v.
Arrellano, 213 F.3d 427, 430 (8th Cir. 2000) (guilty plea waives all nonjurisdictional
defenses). Even if the issue were appealable, the district court correctly ruled Romero
was not entitled to specific performance because he refused to agree to the offer’s
condition that he testify against other suspects. See United States v. Ayd, 25 F.3d
624, 626 (8th Cir. 1994) (government may withdraw offer when defendant cannot
perform conditions).
Romero also asserts the district court committed error in refusing to grant him
a minor role reduction. This assertion fails because Romero did not carry his burden
to prove he was entitled to the reduction. United States v. Johnson, 358 F.3d 1016,
1018 (8th Cir. 2004). Romero offered no evidence in support of the reduction and the
undisputed facts did not support the reduction.
We thus affirm the district court.
______________________________
-2- | 01-03-2023 | 10-13-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1614283/ | 23 So. 3d 1284 (2010)
Daniel M. PORUSH, Appellant,
v.
Nancy PORUSH, Appellee.
No. 4D09-949.
District Court of Appeal of Florida, Fourth District.
January 6, 2010.
*1285 Robin Bresky, Boca Raton, for appellant.
Nancy Porush, Woodbury, New York, pro se.
STEVENSON, J.
Daniel Porush, the former husband, appeals a non-final order, authorizing the suspension of his driver's license and motor vehicle registration for failure to pay child support. We reverse and remand for the trial court to amend its contempt order to include a purge amount and a finding of the former husband's present ability to pay it.
The clerk of the lower court, per the request of the former wife, notified the former husband of a $368,022.75 delinquency in his child support payments. In response, the former husband filed a verified motion to contest the delinquency. At the hearing on this matter, the former husband, in pertinent part, testified that he had made child support payments of $50,000 and $104,450 that had not been recorded in the clerk's ledger. The trial court, adopting the magistrate's findings, entered an order, in pertinent part, directing the clerk to reduce the delinquency by $154,450, but also finding the former husband delinquent and directing the clerk to process the suspension of his driver's license and motor vehicle registration.
Florida Family Law Rule of Procedure 12.615 governs civil contempt proceedings in support matters related to family law cases and limits the use of civil contempt sanctions under the rule to those used to compel compliance with a court order and those used to compensate a movant for losses sustained as a result of a contemnor's willful failure to comply with a court order. Revocation of a delinquent child support obligor's driver's license and motor vehicle registration is a possible sanction to obtain compliance. § 61.13016, Fla. Stat. (2008). "If the court orders incarceration, a coercive fine, or any other coercive sanction for failure to comply with a prior support order, the court shall set conditions for purge of the contempt, based on the contemnor's present ability to comply." Fla. Fam. L.R.P. 12.615(e) (emphasis added). See also Larsen v. Larsen, 901 So. 2d 327, 329 (Fla. 4th DCA 2005) ("[T]he sanction of driver's license suspension must be considered a contempt sanction ... for which the court must find a present ability to pay any purge amount set.").
In the instant case, the trial court erred in neglecting to include a purge provision in its contempt order that authorized the immediate revocation of the former husband's driver's license and motor vehicle registration. Prior to setting a purge provision, the trial court will need to determine the former husband's present ability to pay such an amount. This finding should be included in the order. As to the other issues raised on appeal and not withdrawn, we affirm without discussion.
Affirmed in part, reversed in part, and remanded.
GROSS, C.J., and TAYLOR, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920064/ | 91 B.R. 834 (1988)
In re Joyce J. SCHLANGEN, Debtor.
Bankruptcy No. 86 B 9157.
United States Bankruptcy Court, N.D. Illinois, E.D.
October 27, 1988.
William J. Stevens, Chicago, Ill., for debtor.
Denyse H. Heffner, Office of the U.S. Trustee, Chicago, Ill., for U.S. Trustee.
Louis R. Schroeder, Jaros, Tittle & O'Toole, Chicago, Ill., for Horizon Federal.
MEMORANDUM OPINION
RONALD S. BARLIANT, Bankruptcy Judge.
A secured creditor, Horizon Federal Savings Bank, has moved to dismiss this Chapter 11 case "for cause" under 11 U.S.C. § 1112(b). Horizon alleges that the Debtor's *835 petition was filed in bad faith, solely to frustrate Horizon's efforts to enforce its five mortgage notes, and is being maintained as a litigation tactic in a purely two-party dispute. The United States Trustee supports Horizon's motion to dismiss this case. The Debtor argues that her purposes for filing and maintaining the Chapter 11 case are to rehabilitate her rental real estate business and to liquidate her claims against Horizon for the benefit of her unsecured creditors. The automatic stay was modified after the present motion to dismiss was filed, so that Horizon's foreclosure actions with respect to the Debtor's five properties are proceeding in the state courts. The Debtor's claim against Horizon is the subject of an adversary proceeding now pending in the District Court.
The Court concludes that this case cannot serve the purposes of Chapter 11 because no reorganization of the Debtor's business is possible, nor is the Debtor attempting to liquidate her assets. Rather, the only purpose that can be served by maintaining this case is to preserve federal jurisdiction over a dispute that otherwise would be in the state courts. That is not a sufficient reason for maintaining a Chapter 11 case, and this case will therefore be dismissed.
FACTS
The Debtor operated a real estate rental, management, consulting and brokerage business with her former husband until late 1981. Their real estate activities included the ownership and management of five properties in Wheeling, Illinois, all of which were financed by Horizon's predecessor, Glenview Guaranty Federal Savings and Loan Association. In November, 1981, Glenview declared all five loans in default. These defaults, which the Debtor claims were improperly declared, apparently precipitated the Debtor's first Chapter 11 petition on January 26, 1982, which she filed jointly with her then husband. On January 5, 1984, the automatic stay was modified to allow Glenview to file its complaints for foreclosure on the Debtor's properties. On April 25, 1984, the Debtor's Chapter 11 case was dismissed on a creditor's motion. In late 1984, Horizon's predecessor filed five actions in the Circuit Court of Cook County, Illinois to foreclose the five mortgaged properties and proceeded to judgments of foreclosure in all but one of those cases. The Debtor filed motions in the state court foreclosure proceedings to vacate the judgments. Horizon then petitioned the state court for appointment of a receiver, after which the Debtor filed the present Chapter 11 petition on July 12, 1986.
The Debtor then filed an adversary complaint in this Court on August 1, 1986 alleging that Horizon and its predecessor improperly declared defaults on the five mortgage loans and conspired to destroy her real estate business. The complaint seeks damages of $100,000,000 plus costs. The District Court withdrew the reference of that adversary proceeding, and it is now pending in that Court.
In the bankruptcy case, Horizon moved to modify the automatic stay to permit it to complete the pending state court foreclosures. That motion was also withdrawn by the District Court and ultimately granted. Four of the five foreclosure actions have been concluded, and the properties have been sold at judicial sales, subject to the expiration of redemption periods in November and December, 1988. The fifth foreclosure action is still pending, and the Debtor is in possession of the property that is the subject of that action. She is collecting the rental income from that property.
On December 8, 1986, Horizon filed its motion to dismiss, which is presently before the Court. The reference of that motion was also withdrawn by the District Court, which re-referred that motion to this Court in April, 1988. On September 27, 1988, the Court conducted an evidentiary hearing on Horizon's motion to dismiss at which the Debtor testified as to the current state of her real estate business. She testified that she is currently managing only the one property as to which a foreclosure judgment has not been entered. The rents for units in that property are her only current source of income. She is using *836 that income to pay her personal expenses as well as maintenance and utility costs for the building. She has not paid real estate taxes, insurance premiums, or mortgage payments on this or any of the other properties since the defaults were declared in November, 1981. The Debtor has earned no income since filing the present Chapter 11 petition from real estate brokerage, management or consulting activities. Although she testified that she is currently engaged in several endeavors that may generate income in the near future, she offered no details about any such transaction. She and her attorney made it clear that the bulk of their time and energy in this case is taken up with the litigation in the District and state courts.
On her statement of liabilities, the Debtor lists approximately $36,000 in unsecured debt. One unsecured creditor, with a claim of $10,000, testified to the effect that he is a personal friend of the Debtor, and does not intend to pursue the debt in the bankruptcy proceedings. The only other unsecured claims are those of the Debtor's attorneys in this and her previous Chapter 11 case. One of her prior attorneys appeared in Court to support the Debtor's position, but did not testify. These other unsecured creditors have made no effort to pursue their claims and the Debtor testified that she is current on all her other obligations.
According to her debtor in possession reports (filed in compliance with Bankruptcy Rule X-1007(b)), through August, 1988 the Debtor had received income of about $117,000 and had disbursements of about $118,000. Her reported income includes $10,000 transferred from her credit union, $1,000 from a "vault" and $550 in "cash". She has not filed tax returns for 1986 or 1987 because, according to her testimony, her accountant would not sign the returns.
The Debtor has filed a plan of reorganization. That plan proposes three sources of funds for payments to creditors. One is the Debtor's business. As noted above, in the two years this case has been pending, the only income the Debtor has received is rent on her one remaining property, and that income has been insufficient to cover her disbursements, even though those disbursements do not include insurance, taxes or mortgage payments.
The second proposed source of funds is the refinancing of her remaining building. The Debtor testified that she will be unable to refinance that property until she has successfully defended the Horizon foreclosure action, eliminating Horizon's mortgage. This source of funds therefore depends upon the outcome of that lawsuit in state court.
Third, the Debtor contemplates applying ten percent of any recovery in the adversary proceeding against Horizon, after payment of administrative expenses, to the payment of creditors. The Debtor proposes that she keep the other 90%.
DISCUSSION
The Bankruptcy Code does not expressly require that a Chapter 11 case be filed or maintained in good faith.[1] Historically, however, courts imposed a good faith standard on the commencement and maintenance of bankruptcy reorganization cases under the prior bankruptcy acts. In re Victory Construction Co. Inc., 9 B.R. 549 (Bankr.C.D.Cal.1981) (discussion of the history of good faith standard), modified on other grounds 9 B.R. 570 (Bankr.C.D.Cal. 1981), vacated as moot 37 B.R. 222 (B.A.P. 9th Cir.1984). The Bankruptcy Code authorizes the dismissal of a Chapter 11 case "for cause." 11 U.S.C. § 1112(b).[2] The courts have consistently relied on that provision as authorization for the use of their *837 equity powers to prevent abuse of bankruptcy jurisdiction and the reorganization process. In re HBA East, Inc., 87 B.R. 248, 258-63 (Bankr.E.D.N.Y.1988). The circuit courts have recognized and affirmed the power of bankruptcy courts to dismiss Chapter 11 cases that fail to meet a good faith standard. See e.g., In re Madison Hotel, 749 F.2d 410, 425 (7th Cir.1984) (dicta); In re Natural Land Corporation, 825 F.2d 296 (11th Cir.1987); In re Little Creek Development Co., 779 F.2d 1068 (5th Cir. 1986).[3]
Chapter 11 was designed to prevent the waste and reduction in asset values that result from unnecessary liquidation. Congress meant to encourage financial restructuring and to reestablish efficient business operations with the goals of permitting greater payments to creditors then could otherwise be made, while also preserving jobs and shareholders' interests. See e.g., In re Victory Construction Co., 9 B.R. at 551-65; H.R.Rep. No. 595, 95th Cong., 1st Sess. 220-21 (1977), U.S.Code Cong. & Admin.News 1978, pp. 5787, 5963, 6179; In re HBA East, Inc., 87 B.R. at 259. The good faith standard is the bankruptcy court's equitable mechanism for assuring that a Chapter 11 case at least has the potential to serve those purposes.
The Court's duty as vigilante against illegitimate use of the Bankruptcy Code must be balanced against the policy of open access to the bankruptcy process. See, In re Johns-Manville Corp., 36 B.R. 727, 735-37 (Bankr.S.D.N.Y.1984). Therefore, the Court must be careful not to deny the protection of the Bankruptcy Code to a Debtor whose legitimate efforts at financial rehabilitation may be hidden among derivative benefits (such as the delay of creditors resulting from the automatic stay) that, if viewed alone, might suggest bad faith. See, In re Clinton Centrifuge, Inc. 72 B.R. 900, 905 (Bankr.E.D.Pa.1987).
To protect against unwarranted dismissals, the good faith standard should be viewed as objective rather than subjective. That is, the court's inquiry should primarily focus on the presence or absence of ascertainable, objective factors or "guidelines", rather than the Debtor's subjective intent. HBA East, 87 B.R. at 262. The guidelines that are pertinent to this case that have been articulated by other courts include, 1) that the Chapter 11 petition serves as a litigation tactic in essentially a two-party dispute, 2) that the Debtor has few or no unsecured creditors, 3) that there are few debts to non-moving creditors, 4) that the Debtor has previously filed a Chapter 11 petition, 5) that the petition was filed to delay foreclosure of the Debtor's only or primary asset or assets, 6) that the Debtor has no ongoing business, and 7) that there is no possibility of a rehabilitation of the debtor's business. In re HBA East, Inc., 87 B.R. at 259; In re Clinton Centrifuge, Inc., 72 B.R. at 904; Matter of Grieshop, 63 B.R. 657 (N.D.Ind.1986). The existence of one of these factors will not obligate the court to dismiss the petition for bad faith. Instead, the facts viewed in their totality must show that the case serves predominately or exclusively illegitimate purposes to warrant dismissal for bad faith. In re Little Creek Development Co., 779 F.2d at 1072.
The Court finds that in this case all of the "guidelines" listed above are present. The Debtor filed her complaint in the adversary proceeding approximately one month after the Chapter 11 petition was filed. The timing of the bankruptcy filing by itself does not indicate that the Debtor intended to use the bankruptcy process to confer federal jurisdiction on the adversary proceeding. The allegations in that complaint, however, arise out of the same transactions and occurrences that gave rise to Horizon's foreclosure actions on the five Wheeling, Illinois properties. The Debtor could have filed the action as a counterclaim in the state court foreclosure actions. Even after the automatic stay was lifted and the foreclosure actions allowed to proceed *838 in the state courts, the Debtor maintained her closely related claim as a separate proceeding in the federal court, rather than as a counterclaim in the state court. Moreover, it is clear that the litigation of that claim is the principal activity of the Debtor and her lawyer in this case. There would be no basis for federal jurisdiction but for the bankruptcy filing. It therefore appears that one of the purposes for the Debtor's second Chapter 11 filing was to confer federal jurisdiction on what is otherwise a two-party dispute involving issues of state law. That clearly is the primary purpose for maintaining this case now.
Further, foreclosure of the Debtor's properties was postponed by filing the petition. The petition was filed soon after judgment of foreclosure was entered by the state court on four of the Debtor's properties and after Horizon had petitioned the state court for appointment of a receiver. The imminence of final termination of the Debtor's interests in her properties suggests that a significant reason for filing the bankruptcy petition was to reap the benefits of the automatic stay. As the Debtor points out, imposition of the automatic stay as a derivative benefit of a reorganization proceeding is not justification for dismissal due to bad faith. Matter of Levinsky, 23 B.R. 210, 221 (Bankr.E.D. N.Y.1982). The stay is a legitimate benefit that allows Debtors time to reorganize and some bargaining power in negotiating with creditors. Filing a Chapter 11 case for the sole purpose of invoking the automatic stay without the ability or intent to reorganize, however, is bad faith. Matter of Herndon Executive Center, Inc., 36 B.R. 803 (Bankr. M.D.Fla.1984); In re Thirtieth Place, Inc., 30 B.R. 503 (B.A.P. 9th Cir.1983).
It is clear that the Debtor sought to confer federal jurisdiction on its lawsuit against Horizon and to invoke the automatic stay when she filed her Chapter 11 petition. These two uses of the bankruptcy process would not compel dismissal of the case for bad faith if the Debtor had other legitimate purposes for her filing. The most obvious legitimate purpose would be the reorganization of the Debtor's real estate business. But the facts do not support the Debtor's claim that she is attempting to reorganize an ongoing business. The Debtor is collecting rent on only one building. She has not paid mortgage, insurance or tax expenses for this building since 1981, about five years before the petition was filed in July, 1986. The rent she collects is used to pay her personal expenses and building maintenance and utility costs, not to develop her real estate business. Four of her five properties have been sold, and there is no evidence that the Debtor will be able to redeem them. Although she testified that she is involved in consulting and brokerage activities, they have generated no income since July, 1986. This is in stark contrast with the Debtor's earlier real estate activities when she and her exhusband sold over $7 million worth of properties in their first seven months of operations. Most of the Debtor's time and energy, by her testimony, has been spent on investigatory work for the lawsuit against Horizon. The Debtor's plan depends upon her success in the federal and state litigation, not any restructuring of her business or her relationship with creditors. The Court must find that there is no business left to reorganize and that this Chapter 11 case cannot serve the purpose of rehabilitating the Debtor's business.
The Debtor, however, argues that it does not matter whether she has a chance to rehabilitate her business because she is proposing a "liquidating" plan to pay all her creditors. It is correct that a Chapter 11 plan may "provide for the sale of all or substantially all of the property of the estate, and the distribution of the proceeds of such sale among holders of claims or interests . . ." 11 U.S.C. § 1123(b)(4). Liquidation is therefore a legitimate purpose of a Chapter 11 case, and a case should not be dismissed simply because the Debtor contemplates a liquidating plan. R. Ginsberg, Bankruptcy, ¶ 13,104 (1986).
The Debtor, however, is not proposing to sell the property of the estate. Instead, she proposes to pay creditors from three sources: the operation of the Debtor's business, the refinancing of the one property that remains in her possession, and her *839 litigation with Horizon. It is evident from her testimony that her real hope is to prevail on her claim against Horizon. But she is not proposing to sell that claim, only to litigate it to judgment. The Debtor's success in that dispute may provide her with a fund with which to pay debts, but that would be equally true outside Chapter 11.
Moreover, the Debtor does not have substantial unsecured creditors who are pressing for payment. If the Debtor were able to show a desire and a means to reorganize, absence of unsecured creditors alone would not justify dismissal for bad faith. Levinsky, 23 B.R. at 220-21. Along with the other badges of bad faith and the absence of an operating business to reorganize, this factor further demonstrates the absence of a legitimate reorganization purpose.
It may well be, as the Debtor argues, that the dismissal of this case will further delay the final resolution of the Debtor's dispute with Horizon. Nevertheless, although efficient disposition of litigation is a desirable goal, use of the bankruptcy court's jurisdiction without some other legitimate link to the bankruptcy process is not proper. Without at least the means and the desire to reorganize, a Debtor may not invoke federal bankruptcy jurisdiction to litigate state court matters. In addition, the Debtor might have avoided this delay by litigating her claim as a counterclaim in the foreclosure cases that were filed four years ago.
Since 1981, the Debtor's business activities have been sparse and she has no substantial unsecured creditors. The Chapter 11 petition was filed in July 1986 to confer federal jurisdiction on what is otherwise a two-party dispute involving state law issues and to invoke the benefits of the automatic stay to protect her real estate interests. Upon the modification of that stay, jurisdiction over the Debtor's five real estate holdings effectively passed to the state courts, and four of those properties have been sold. There is no likelihood that this case will result in the rehabilitation of the Debtor's business or the orderly liquidation of her remaining assets. The only present purpose being served by this case is to provide a basis for federal jurisdiction over the Horizon lawsuit. Absent some legitimate reorganization objective achievable in a Chapter 11 case (which might include the orderly liquidation of assets), Chapter 11 cannot be used merely to provide a federal forum for a lawsuit. Since no such objective is achievable here, Horizon's motion to dismiss the Debtor's Chapter 11 case "for cause" is granted.
An Order will be entered dismissing the case for cause.
NOTES
[1] The Bankruptcy Code does expressly require that the debtor's plan of reorganization be "proposed in good faith and not by any means forbidden by law" as a prerequisite to confirmation of the plan. 11 U.S.C. § 1129(a)(3). The issue here does not concern confirmation.
[2] Section 1112(b) provides that the court "may dismiss a case under this chapter . . . for cause, including . . .", and then lists ten specific "causes." By using the word "including" Congress made it clear that dismissal under section 1112(b) might be for causes not listed in that section. 11 U.S.C. § 102(3) (rule of construction that "`including' [is] not limiting").
[3] Between them, Victory Construction, 9 B.R. at 552-70, and HBA East, 87 B.R. at 258-63, thoroughly discuss the development and current understanding of the good faith standard, as well as the authorities that support the application of that standard. This opinion will only summarize that analysis and will cite only a few of the cases referred to in those opinions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/97113/ | 215 U.S. 266 (1909)
RIO GRANDE DAM AND IRRIGATION COMPANY
v.
UNITED STATES.
No. 49.
Supreme Court of United States.
Argued December 3, 1909.
Decided December 13, 1909.
APPEAL FROM THE SUPREME COURT OF THE TERRITORY OF NEW MEXICO.
*271 Mr. William W. Bride and Mr. Frederick S. Tyler, with whom Mr. Charles A. Douglas was on the brief, for plaintiffs in error.
The Solicitor General for the United States, appellee.
*274 MR. JUSTICE HARLAN, after making the foregoing statement, delivered the opinion of the court.
We perceive no error in the judgment now under review. *275 The main contention of the defendants is that it was error to permit the United States to file its supplemental bill. We do not accept this view of the trial court's duty. When the cause was last here the court expressed the conviction that if the case was finally disposed of on the record as it then was great wrong might be done to the United States and to all interested in preserving the navigability of the Rio Grande. Hence, the cause was sent back that each side might adduce further evidence, if they had any to adduce. When the Government asked to file its supplemental bill the suit was of course reinstated on the docket of the court of original jurisdiction for such action as might be proper or necessary. The case having been opened that further evidence might be produced, it was certainly open for an amendment of the original pleadings or for such additional pleadings as might be appropriate to the issues between the parties. The parties were not limited to the production merely of evidence. The defendants, in the discretion of the court, could have been allowed, upon a proper showing and before taking further proof, to amend their pleadings, and equally the Government, before taking further proof, could have been allowed to file a supplemental complaint. Marine Ins. Co. v. Hodgson, 6 Cranch, 206, 218. Besides, subsection 87 of the New Mexico Civil Code would seem to be broad enough to cover the question of power. It provides: "A party may be allowed, on motion, to make a supplemental complaint, answer or reply, alleging facts material to the cause, or praying for any other or different relief, order or judgment." The facts set forth in the supplemental complaint were manifestly not foreign to the Government's original cause of action. In every substantial sense those facts were material. Strictly speaking, they may have constituted new matter, but they did not present a new cause of action. Jenkins v. International Bank of Chicago, 127 U.S. 484. They grew out of and were connected with the same transaction from which this litigation arose, and were germane to the object of the suit. That object was to restrain the defendants *276 from constructing and maintaining dams, reservoirs, canals or ditches that would obstruct the navigable portion of the Rio Grande River. If all the grounds of relief set out in the supplemental complaint did not exist when the original complaint was filed, they were alleged to exist when the supplemental complaint was tendered, and being connected with the original cause of action it was right to bring them, in proper from, to the attention of the court when determining whether the Government was entitled to the relief it asked. So the Supreme Court of the Territory held, and so we hold. There was, plainly, no abuse of discretion or of the established rules of practice in permitting the supplemental complaint to be filed. The allowance of amendments of equity pleadings must "at every stage of the cause, rest in the discretion of the court; and that discretion must depend largely on the special circumstances of each case." Hardin v. Boyd, 113 U.S. 756, 761.
Upon the question of the diligence or want of diligence of the parties, it may be said that the supplemental complaint was tendered at a time when the court was open; the leave to file was given in open court; and the defendant's attorney was served with a copy of that complaint on the very day it was tendered and filed. On this part of the case the Supreme Court of the Territory said that attorneys of record are presumed to be present during terms of the court in which their causes are pending, and in contemplation of law were chargeable with notice of all proceedings transpiring in open court in respect of such causes; also, that "under the facts of this case, counsel are presumed to have been present, and to have such notice as the law requires of matters transpiring in open court on the day on which leave was granted to file the supplemental complaint, and the same was filed and served upon them. Younge v. Broxson, 23 Alabama, 684; Sanders v. Savage, 63 S.D. 218. The court was vested with discretion by the last clause of sec. 104, supra, [Code of Civil Procedure, as amended by c. 11 of Laws of 1901] which does not seem to have been abused, nor was there any abuse of the general discretion *277 to allow an amended or supplemental bill in equity conferred upon the courts of the United States, as may be seen by reference to the case of Berliner Gramophone Co. v. Seamon, 113 Fed. Rep. 750, in which it was held that, `the granting of leave to file an amended and supplemental bill is a matter within the discretion of the court, and its action will not be reviewed in an appellate court unless there has been a gross abuse of this discretion.'"
The objection that the trial court erred in taking the supplemental complaint for confessed cannot be sustained. That objection was thus properly disposed of by the Supreme Court of the Territory: "There being no error or irregularity in the court's order allowing the supplemental complaint to be filed, the same having been done in open court, and a copy of the same having been served upon one of the attorneys of record on the same day on which it was filed, the statute required an answer or other proper pleading to be filed within twenty days from the date of such filing, and in the event of failure to plead, or secure additional time to plead, neither of which were done in this case, it was perfectly regular for the court to render decree. Gregory v. Pike, 29 Fed. Rep. 588. Appellants seek to be relieved from their own default by alleging neglect on the part of their attorneys. . . . There being service of a copy of the supplemental complaint upon one of the attorneys of record on the day on which it was filed it was entirely regular for the court to render the decree when applied for 44 days after such service, in the absence of any appearance or pleading by the appellants."
Some stress is laid on the fact that the Government obtained an injunction to prevent the defendants from constructing its reservoir and dam. That fact, it is contended, estops the Government from relying on the five-years' limitation prescribed by the above act of March 3d, 1891, c. 561. But this view is without merit. The preliminary injunction referred to was dissolved July 31st, 1897, and was never reinstated. The supplemental bill was taken as confessed on *278 May 21st, 1903, and a perpetual injunction was then awarded against the defendants. So that between the dissolution of the preliminary injunction and the granting of the perpetual injunction more than five years elapsed, during which the defendants were not impeded or hindered by any injunction against them. This is sufficient to show that the point just stated is without merit. We need not, therefore, consider the larger question, whether the five-years' limitation prescribed by Congress in the above act of March 3d, 1891, could have been disregarded or enlarged either by the action or non-action of the parties or by any order of injunction made by the court in the progress of the cause.
There are some minor questions in the case, but they are not of substance and need not be noticed. We perceive no error of law in the record, and the judgment is
Affirmed.
MR. JUSTICE McKENNA did not participate in the consideration or determination of this case. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/1614521/ | 939 So.2d 247 (2006)
TYRONE M. HOWARD, Petitioner,
v.
FLORIDA PAROLE COMMISSION, Respondent.
Case No. 1D06-0580.
District Court of Appeal of Florida, First District.
Opinion filed October 16, 2006.
Tyrone M. Howard, pro se, Petitioner.
Kim M. Fluharty, General Counsel, and Susan Schwartz, Assistant General Counsel, Florida Parole Commission, Tallahassee, for Respondent.
PER CURIAM.
By a petition for writ of certiorari, petitioner, Tyrone Howard, a prisoner in the state correctional system, seeks review of a final order entered by the circuit court. Because we conclude that the circuit court's order constituted a departure from the essential requirements of law, we grant the petition.
The Florida Parole Commission ("FPC") declined to set an effective parole release date ("EPRD") for petitioner, citing his criminal history, unsatisfactory conduct while in prison, and a psychological evaluation. To facilitate judicial review, FPC must articulate with specificity the reasons for its decision and provide the information from the complete official record in the inmate's file that supports those reasons. Williams v. Fla. Parole Comm'n, 625 So. 2d 926, 939 (Fla. 1st DCA 1993) receded from on other grounds, Sheley v. Fla. Parole Comm'n, 703 So. 2d 1202 (Fla. 1st DCA 1997). A circuit court is required to review the record considered by FPC before entering its final order. See Myers v. Fla. Parole & Prob. Comm'n, 705 So. 2d 1000 (Fla. 4th DCA 1998); McCorvey v. Fla. Parole Comm'n, 625 So. 2d 1296 (Fla. 1st DCA 1993). Petitioner filed a petition for writ of habeas corpus in the circuit court to challenge FPC's decision. FPC filed a response and cited petitioner's psychological evaluation, but FPC did not provide a copy of that evaluation to the circuit court for review. Petitioner filed a reply and argued that the circuit court was required to review the psychological evaluation. The circuit court denied the petition, and petitioner sought certiorari review in this Court.
"The scope of our review on such a petition for certiorari is limited to determining whether the trial court (1) afforded due process and (2) observed the essential requirements of law." Randall v. Fla. Dep't of Law Enforcement, 791 So. 2d 1238, 1240 (Fla. 1st DCA 2001) (citing Sheley, 703 So. 2d at 1202, approved, 720 So. 2d 216 (Fla. 1998)). A ruling constitutes a departure from "the essential requirements of law" when it amounts to "a violation of a clearly established principle of law resulting in a miscarriage of justice." Combs v. State, 436 So. 2d 93, 95-96 (Fla. 1983).
FPC has argued that its summary of the psychological evaluation was sufficient and that petitioner did not challenge that summary as inaccurate. In Williams, this Court held that a circuit court reviewing an FPC decision for an abuse of discretion must determine from the record whether FPC deviated from legal requirements or otherwise acted improperly in reaching its decision. This Court stated:
Based on the record before us, it appears that the Commission did not identify the portions of the record that support some of its reasons, and that the trial court did not have material portions of the complete official file in Williams's case that were or should have been considered by the Commission in deferring Williams's EPRD and denying parole for the reasons stated.
Williams, 625 So. 2d at 939. In order to determine whether FPC acted properly, "the trial court should have had available for review those portions of the inmate's file that are relevant and material to the reasons cited by the Commission's order. . . ." Id. In Swain v. Fla. Parole Comm'n, 776 So. 2d 1079 (Fla. 4th DCA 2001), the court similarly viewed Williams as creating a requirement that the circuit court must review the material portions of an inmate's file before determining whether FPC abused its discretion. Here, the circuit court was required to review the psychological evaluation considered by FPC to determine whether FPC abused its discretion in declining to authorize an EPRD. See Welsch v. State, 823 So. 2d 310 (Fla. 2d DCA 2002) (stating that a circuit court is required to review the record, including an inmate's psychological evaluation, considered by FPC before entering its final order).
Accordingly, we grant the petition for writ of certiorari, quash the circuit court's order, and remand for further proceedings.
PETITION GRANTED.
KAHN, BENTON, and LEWIS, JJ., CONCUR.
NOT FINAL UNTIL TIME EXPIRES TO FILE MOTION FOR REHEARING AND DISPOSITION THEREOF IF FILED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614319/ | 23 So.3d 329 (2009)
TRANSCONTINENTAL GAS PIPE LINE CORPORATION, Texas Eastern Transmission Corporation, Florida Gas Transmission Company, and Gulf South Pipeline Company, L.P.
v.
LOUISIANA TAX COMMISSION; Frank Granger, III, In his Official Capacity as the Assessor of East Baton Rouge Parish; and Elmer B. Litchfield, In his Official Capacity as the Sheriff and Ex Officio Tax Collector for East Baton Rouge Parish.
Florida Gas Transmission Company
v.
Louisiana Tax Commission; Elizabeth Guglielmo, In her Capacity as Chairperson of the Louisiana Tax Commission; Sheriff Wayne Melancon, Acadia Parish; Sheriff Mike Waguespack, Assumption Parish; Sheriff Tony Mancuso, Calcasieu Parish; Sheriff Theos Duhon, Cameron Parish; Sheriff Greg Phares, East Baton Rouge Parish; Sheriff Sid Hebert, Iberia Parish; Sheriff Brent Allain, Iberville Parish; Sheriff Richard Edwards, Jr., Jefferson Davis Parish; Sheriff Michael Neustrom, Lafayette Parish; Sheriff Craig Webre, Lafourche Parish; Sheriff Paul Raymond Smith, Pointe Coupee Parish; Sheriff Gregory Champagne, St. Charles Parish; *330 Sheriff Ronald Ficklin, St. Helena Parish; Sheriff Bobby Guidroz, St. Landry Parish; Sheriff Ronald J. Theriot, St. Martin Parish; Sheriff David A. Naquin, St. Mary Parish; Sheriff Daniel Edwards, Tangipahoa Parish; Sheriff Michael Couvillion, Vermilion Parish; Sheriff Aubrey Jones, Washington Parish; and Sheriff Mike Cazes, West Baton Rouge Parish, in their Capacities as ex Officio Tax Collectors in and for their Respective Parishes. Hon. Russel L. Benoit, Acadia Parish; Hon. Wayne P. Blanchard, Assumption Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. James H. Dupont, Iberville Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Conrad Comeaux, Lafayette Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. James A. Laurent, Pointe Coupee Parish; Hon. Clyde A. Gisclair, St. Charles Parish; Hon. Wesley Blades, St. Helena Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Joaquin Matheu, Tangipahoa Parish; Hon. Michael Langlinais, Vermilion Parish; Hon. M. Randall Seal, Washington Parish; and Hon. Barney Altazan, West Baton Rouge Parish, in their Capacities as Assessors in and for their Respective Parishes.
Nos. 2009 CA 0628, 2009 CA 0629.
Court of Appeal of Louisiana, First Circuit.
August 10, 2009.
Rehearing Denied September 3, 2009.
*334 Linda S. Akchin, Baton Rouge, LA, for Plaintiff/Appellant, Florida Gas Transmission Company, Centerpoint Energy Mississippi River Centerpoint Energy Gas Transmission.
Brian Eddington, Baton Rouge, LA, for Defendants/Appellees, Sheriff Wayne Melancon, Acadia Parish and Sheriffs and Assessors.
Robert D. Hoffman, Jr. Mandeville, LA, for Defendant/Appellee, Louisiana Tax Commission.
*335 Michael J. Vallan, Baton Rouge, LA, for Defendant/Appellee, State of Louisiana Attorney General Office.
Before CARTER, C.J., WHIPPLE and DOWNING, JJ.
CARTER, C.J.
This is an appeal from the partial grant of a partial summary judgment filed in an ad valorem tax dispute between Florida Gas Transmission Company (the plaintiff), an interstate natural gas pipeline company, and the defendants, the Louisiana Tax Commission (LTC) and various sheriffs and assessors throughout the state of Louisiana. This appeal has been expedited in accordance with La. R.S. 47:1998.
At issue is whether Louisiana's ad valorem tax scheme violates the Commerce Clause of the United States Constitution either in form or in application. After due consideration, that part of the district court judgment partially granting the assessors' motion for summary judgment is affirmed. That part of the district court judgment partially denying the assessors' motion for summary judgment is reversed, and we render judgment declaring La. R.S. 47:1851 K unconstitutional and La. R.S. 47:1851 M unconstitutional in part.
FACTS AND PROCEDURAL HISTORY[1]
The facts of this case, although lengthy, are substantially undisputed. The plaintiff is the owner of interstate natural gas pipelines located in part within the territorial boundaries of Louisiana. At issue herein is the plaintiffs liability for 2006 Louisiana ad valorem taxes.
The plaintiff is a "pipeline company," as defined in La. R.S. 47:1851 K, that owns, and owes ad valorem taxes on, "public service property," as that category of property is defined in La. R.S. 47:1851 M. So defined, the plaintiff is subject to an assessment of 25% of fair market value, as determined by the LTC. See La. Const, art. VII, § 18. Other similarly situated, direct competitors operating in intrastate commerce do not meet the definition of "pipeline companies." Their properties are not considered "public service properties," and therefore, they are subject to assessments of 15% of fair market value, as determined by the local assessors. See La. Const, art. VII, § 18.
The plaintiff paid its 2006 ad valorem tax assessment under protest and filed suit, asserting therein that "challenges to the assessed valuation of its pipeline property by the LTC and to the Louisiana ad valorem tax scheme ... are solely constitutional issues." The plaintiff sought a finding that "the Louisiana ad valorem tax scheme is unconstitutional [and] in violation of the Commerce Clause of the United States Constitution, in that it imposes an impermissible burden on interstate commerce by imposing a greater tax burden on interstate natural gas pipelines companies than it does upon intrastate natural gas pipeline companies." Specifically, the plaintiff maintained that the assessment of its property at 25% of fair market value, as opposed to 15% of fair market value, is in violation of the Commerce Clause of the United States Constitution.[2]
*336 Named as defendants in this litigation are the LTC; Elizabeth Guglielmo, in her capacity as Chairperson of the LTC; and twenty sheriffs and twenty assessors from parishes scattered throughout the state of Louisiana.[3]
On motion of various assessors, this action (bearing docket number 551,435) was transferred and consolidated with district court docket number 491,453 (Transcontinental Gas Pipe Line Corporation, et al. v. Louisiana Tax Commission, et al.). Numerous distinct district court actions have been consolidated under docket number 491,453 and are currently pending in the Nineteenth Judicial District Court. Although there may be some overlap in the plaintiffs, the defendants, and the tax years in these consolidated actions, each action is unique. See Dendy v. City National Bank, 2006-2436 (La.App. 1 Cir. 10/17/07), 977 So.2d 8, 11 (noting that the consolidation of actions pursuant to La. Code Civ. P. art. 1561 is a procedural convenience designed to avoid multiplicity of actions and does not cause a case to lose its status as a procedural entity). In common, the plaintiffs in each suit are corporate interstate pipeline companies, all challenging the constitutionality of Louisiana's ad valorem tax scheme.
Thirteen assessors collectively answered the plaintiffs petition.[4] Thereafter, a motion for summary judgment was filed on *337 behalf of twelve assessors.[5] The assessors asked for a declaration as to the constitutionality of the Louisiana ad valorem tax scheme and, to the extent the district court determined the tax scheme to be unconstitutional, a judgment specifically striking the unconstitutional provisions. The assessors also asked for entry of summary judgment dismissing the plaintiffs claims for refunds and remanding this matter to the LTC for revaluation of the plaintiffs property by the parish assessors and reassessment at 15% of fair market value. Succinctly stated, through their motion for summary judgment, the assessors asked the district court to determine the legal efficacy of the plaintiffs claims.
Later, Sheriff Greg Champagne of St. Charles Parish and Sheriff Sidney Gautreaux filed their own answers to the plaintiffs petition.[6] Sheriff Champagne and Sheriff Gautreaux did not join in the motion for summary judgment and are not parties to this appeal.
On December 16, 2008, the district court signed a written judgment granting in part and denying in part the motion for summary judgment filed by the "Assessors of Acadia; Cameron; East Baton Rouge; Iberia; Jefferson Davis; Lafourche; St. Landry; St. Martin; St. Mary; Vermilion and Washington Parishes in Docket No. 551,432."[7] The trial court rendered judgment, finding that in order to avoid a violation of the Commerce Clause of the United States Constitution, taxes on all pipeline property (whether operated in interstate or intrastate commerce) should be calculated at a 15% rate. Citing to Transcontinental Gas Pipe Line Corporation v. Louisiana Tax Commission, 2005-2604, 2005-2605 (La.App. 1 Cir. 3/31/06), 925 So.2d 777 (unpublished), writ denied, XXXX-XXXX (La.9/1/06), 936 So.2d 204, and ANR Pipeline Co. v. Louisiana Tax Commission, XXXX-XXXX (La.App. 1 Cir. 9/7/05), 923 So.2d 81, writ denied, 2005-2372 (La.3/17/06), 925 So.2d 547, cert. denied, 549 U.S. 822, 127 S.Ct. 157, 166 L.Ed.2d 38, the district court further remanded the matters to the LTC with instructions that the LTC require the named assessors "to determine the valuation of public service properties of the Plaintiff, Florida Gas Transmission Company[,] in their respective parishes for each year at issue and calculate ad valorem taxes based on fifteen percent (15%) of those assessments." The district court found it unnecessary to rule on the constitutionality of La. R.S. 47:1851 in reaching its decision.
On motion of the assessors, the trial court designated the partial judgment as *338 final and immediately appealable pursuant to La.Code Civ. P. art. 1915 B. The plaintiff then moved for orders of appeal to both the Louisiana Supreme Court and to the Louisiana First Circuit Court of Appeal. After the plaintiffs appeal was lodged with this court, the LTC answered the appeal stating it is aggrieved by the trial court's judgment "to the extent that the judgment holds that any portion of the Louisiana Ad Valorem property tax scheme is unconstitutional or otherwise illegal." The assessors did not appeal the trial court's judgment and have not answered the appeal.
After the record was lodged with this court, the Louisiana Supreme Court issued an opinion dismissing the plaintiffs appeal to the supreme court. The supreme court noted that "[b]ecause there is no declaration of unconstitutionality in the district court's judgment, there is no basis for the exercise of this court's appellate jurisdiction. Appellate jurisdiction lies in the court of appeal. La. Const, art. V, § 10(A)." The appeal was transferred "to the court of appeal for consideration on the merits."[8]Florida Gas Transmission Co. v. Louisiana Tax Commission, XXXX-XXXX (La.05/15/09), 10 So.3d 1219, 1220 (per curiam).
The remand from the Louisiana Supreme Court has been lodged with this court as Transcontinental Gas Pipe Line Corp. v. Louisiana Tax Commission, XXXX-XXXX, consolidated with, Florida Gas Transmission Co. v. Louisiana Tax Commission, XXXX-XXXX (La.App. 1 Cir. 8/10/09), 2009 WL 2462543 (unpublished). The issues raised by the plaintiff in the cases remanded by the Louisiana Supreme Court were raised herein. In addition, the LTC has answered this appeal. For these reasons, we will evaluate the merits of all claims herein and dismiss by separate action the appeal lodged under docket no. 2009-0966 c/w XXXX-XXXX as moot.
DISCUSSION
The Standard of Review and the Burden of Proof
Appellate review of the granting of a motion for summary judgment is de novo, using the identical criteria that govern the district court's consideration of whether summary judgment is appropriate. King v. Illinois National Insurance Co., XXXX-XXXX (La.4/3/09), 9 So.3d 780, 784. A motion for summary judgment is properly granted only if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is no genuine issue of material fact, and the mover is entitled to judgment as a matter of law. See La.Code Civ. P. art. 966 B.
On a motion for summary judgment, the burden of proof remains with the movant. Samaha v. Rau, XXXX-XXXX (La.2/26/08), 977 So.2d 880, 883. However, if the movant will not bear the burden of proof at trial, 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. Samaha, 977 So.2d at 883. Rather, the movant's burden is 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. Samaha, 977 So.2d at 883. 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 *339 fact. Samaha, 977 So.2d at 883. Once the motion for summary judgment has been properly supported by the moving party, the failure of the non-moving party to produce evidence of a material factual dispute mandates the granting of the motion. Samaha, 977 So.2d at 883.
Herein, the significant facts are undisputed, and only questions of law remain. Because statutes are presumed to be constitutional, the party challenging the validity of a statute, the plaintiff herein, has the burden of proving its unconstitutionality. Fruge v. Board of Trustees of Louisiana State Employees' Retirement System, XXXX-XXXX (La.12/2/08), 6 So.3d 124, 128. However, when engaged in a Commerce Clause analysis, the burden may shift between the taxpayer and taxing authority. For example, once a state law is shown to discriminate either on its face or in practical effect, the burden falls on the state to demonstrate that the statute serves a legitimate local purpose that cannot be achieved in a less discriminatory way. Maine v. Taylor, 477 U.S. 131, 138, 106 S.Ct. 2440, 91 L.Ed.2d 110 (1986).[9]
Commerce Clause Analysis
The Commerce Clause of the United States Constitution grants Congress the power "[t]o regulate Commerce... among the several States...." U.S. Const, art. I, § 8, cl. 3. "The very purpose of the Commerce Clause was to create an area of free trade among the several States." McLeod v. J.E. Dilworth Co., 322 U.S. 327, 330, 64 S.Ct. 1023, 88 L.Ed. 1304(1944).
The Commerce Clause not only authorizes congressional action but also prohibits certain state taxation even when Congress has failed to legislate on the subject. Oklahoma Tax Commission v. Jefferson Lines, Inc., 514 U.S. 175, 179, 115 S.Ct. 1331, 131 L.Ed.2d 261 (1995). The Commerce Clause has a negative aspect that denies the states the power unjustifiably to discriminate against or burden the interstate flow of articles of commerce. Oregon Waste Systems, Inc. v. Department of Environmental Quality of the State of Oregon, 511 U.S. 93, 98, 114 S.Ct. 1345, 128 L.Ed.2d 13 (1994). This restrictive aspect of the Commerce Clause is referred to as the dormant Commerce Clause.[10]See Oklahoma Tax Commission, 514 U.S. at 179, 115 S.Ct. 1331.
The dormant Commerce Clause prohibits states, unless authorized by Congress, from attempting to advance their own commercial interests by curtailing the movement of articles of commerce, either into or out of the state. H.P. Hood *340 & Sons, Inc. v. DuMond, 336 U.S. 525, 535, 69 S.Ct. 657, 93 L.Ed. 865 (1949). Discrimination is the "differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter." Oregon Waste Systems, 511 U.S. at 99, 114 S.Ct. 1345. A state may not tax a transaction or incident more heavily when it crosses state lines than when it occurs entirely within the state. Armco Inc. v. Hardesty, 467 U.S. 638, 642, 104 S.Ct. 2620, 81 L.Ed.2d 540 (1984). No state may impose a tax that discriminates against interstate commerce by providing a direct commercial advantage to local business. Boston Stock Exchange v. State Tax Commission, 429 U.S. 318, 329, 97 S.Ct. 599, 50 L.Ed.2d 514 (1977).
This anti-discrimination principle arises from the basic purpose of the Commerce Clause, which is to prohibit the multiplication of preferential trade areas destructive of the free commerce anticipated by the Constitution. Maryland v. Louisiana, 451 U.S. 725, 754, 101 S.Ct. 2114, 68 L.Ed.2d 576 (1981). The dormant Commerce Clause's fundamental objective is to preserve a national market for competition that is undisturbed by preferential advantages conferred by a state upon its resident competitors. See General Motors Corp. v. Tracy, 519 U.S. 278, 299, 117 S.Ct. 811, 136 L.Ed.2d 761 (1997).
Any notion of discrimination assumes a comparison of substantially similar entities. United Haulers Association, Inc. v. Oneida-Herkimer Solid Waste Management Authority, 550 U.S. 330, 342, 127 S.Ct. 1786, 167 L.Ed.2d 655 (2007); General Motors, 519 U.S. at 298, 117 S.Ct. 811. For the dormant Commerce Clause to apply, it is essential that there be actual or prospective competition between supposedly favored and disfavored entities in a single market, whether by express discrimination against interstate commerce or undue burden upon it. General Motors, 519 U.S. at 300, 117 S.Ct. 811. All parties agree that the natural gas pipeline companies operating in Louisiana, both those operating intrastate and interstate, are direct competitors and similarly situated; therefore, dormant Commerce Clause analysis is appropriate.
In Complete Auto Transit v. Brady, 430 U.S. 274, 279, 97 S.Ct. 1076, 51 L.Ed.2d 326 (1977), the Supreme Court set forth a four-part test that state taxes must pass in order to be valid under the Commerce Clause. The tax must:
1. Be applied to an activity that has a substantial nexus with the state;
2. Be fairly apportioned to activities in the state;
3. Not discriminate against interstate commerce; and
4. Be fairly related to services provided by the state.
Only the third requirement is at issue herein. Does the Louisiana ad valorem tax scheme discriminate against interstate commerce? A state tax discriminates against interstate commerce if it: (1) is facially discriminatory; (2) has a discriminatory intent; or (3) has the effect of unduly burdening interstate commerce. Amerada Hess Corp. v. Director, Division of Taxation, New Jersey Department of the Treasury, 490 U.S. 66, 75, 109 S.Ct. 1617, 104 L.Ed.2d 58 (1989).
Notably, even nondiscriminatory burdens on commerce may be struck down on a showing that they clearly outweigh the benefits of a state or local practice. Pike v. Bruce Church, Inc., 397 U.S. 137, 142, 90 S.Ct. 844, 25 L.Ed.2d 174 (1970). If interstate commerce is burdened, courts should consider three facts:
1. Is there a furtherance of a legitimate local public interest;
*341 2. Does the statute regulate even-handedly; and
3. Does the statute place an undue burden on interstate commerce?
Pike, 397 U.S. at 142, 90 S.Ct. 844.
Unfortunately, there is no clear line separating the category of state regulation that is virtually per se invalid under the Commerce Clause and the category subject to the Pike balancing approach. Brown-Forman Distillers Corp. v. New York State Liquor Authority, 476 U.S. 573, 579, 106 S.Ct. 2080, 90 L.Ed.2d 552 (1986). In both situations, however, the critical consideration is the overall effect of the statute on both local and interstate activity. Brown-Forman, 476 U.S. at 579, 106 S.Ct. 2080.
When called upon to make the delicate adjustment between the national interest in free and open trade and the legitimate interest of the individual states in exercising their taxing powers, the Supreme Court has advised that the result turns on the unique characteristics of the statute at issue and the particular circumstances in each case. Boston Stock Exchange, 429 U.S. at 329, 97 S.Ct. 599. This case-by-case approach has left "much room for controversy and confusion and little in the way of precise guides to the States in the exercise of their indispensable power of taxation." Northwestern States Portland Cement Co. v. Minnesota, 358 U.S. 450, 457, 79 S.Ct. 357, 3 L.Ed.2d 421 (1959).
With these legal precepts in mind, we turn our attention to Louisiana's ad valorem tax scheme. "A state tax must be assessed in light of its actual effect considered in conjunction with other provisions of the State's tax scheme." Maryland, 451 U.S. at 756, 101 S.Ct. 2114. The assessment and collection of ad valorem taxes in Louisiana is provided for in our constitution, as well as in our revised statutes. Louisiana employs a classified property tax system in assessing ad valorem taxes. Under the Louisiana system, pipeline properties, both interstate and certain intrastate, are assessed at a higher ratio to fair market value (25%) than other intrastate pipeline properties (15%). The plaintiff maintains that Louisiana's classification scheme subjects interstate natural gas pipelines to discriminatory taxation, which is prohibited under the Commerce Clause of the United States Constitution.
Louisiana Constitution article VII, section 18 B provides for the classification of property subject to ad valorem taxes in Louisiana and the percentage of fair market value applicable to each classification for the purpose of determining the assessed valuation. Significant to this litigation, "public service properties," excluding land, are subject to a 25% assessed valuation. "Other property" is subject to a 15% of fair market value assessment. Article VII, section 18(B) provides that "[t]he legislature may enact laws defining ... public service properties."
The legislature has defined "public service properties" as "immovable, major movable, and other movable property owned or used but not otherwise assessed in this state in the operations of each ... pipeline company[.]" La. R.S. 47:1851 M. "Pipeline company" is defined in La. R.S. 47:1851 K as:
[A]ny company that is engaged primarily in the business of transporting oil, natural gas, petroleum products, or other products within, through, into, or from this state, and which is regulated by (1) the Louisiana Public Service Commission, (2) the Interstate Commerce Commission, or (3) the Federal Power Commission, as a "natural gas company" under the Federal Natural Gas Act, 15 U.S.C. §§ 717-717w, because that person is engaged in the transportation of *342 natural gas in interstate commerce, as defined in the Natural Gas Act.
Article VII, section 18(D) provides for the method of determining the fair market value of property subject to ad valorem taxation. Specifically:
Each assessor shall determine the fair market value of all property subject to taxation within his respective parish or district except public service properties, which shall be valued at fair market value by the Louisiana Tax Commission or its successor. Each assessor shall determine the use value of property which is to be so assessed under the provisions of Paragraph (C). Fair market value and use value of property shall be determined in accordance with criteria which shall be established by law and which shall apply uniformly throughout the state.
When a constitutional provision is plain and unambiguous and its application does not lead to absurd consequences, its language must be given effect. Board of Directors of Indus. Development Bd. of City of Gonzales, Louisiana, Inc. v. All Taxpayers, Property Owners, Citizens of City of Gonzales, 2005-2298 (La.9/6/06), 938 So.2d 11, 20. Under the clear language of La. Const, art. VII, § 18(D), the LTC determines the fair market value of "public service properties." The fair market value of all other property subject to taxation within a parish is determined by the assessor of the parish where the property is located.
To summarize, pursuant to La R.S. 47:1851 K and M and La. Const, art. VII, § 18(D), companies that transport natural gas within, through, into, or from this state and which are subject to specific regulation are defined as "pipeline companies." These statutorily defined "pipeline companies" possess immovable, major movable, and other movable properties that are statutorily defined as "public service properties." These statutorily defined "public service properties" are subject to an assessment based on 25% of fair market value as determined by the LTC.
The plaintiffs pipelines are regulated by the Federal Energy Regulatory Commission (FERC), successor agency of the Federal Power Commission, under the Federal Natural Gas Act (NGA), 15 U.S.C. §§ 717-717w. Accordingly, the plaintiff is a "natural-gas company" as that term is defined under the NGA, 15 U.S.C. § 717a(6). As an FERC-regulated natural gas company under the NGA, the plaintiff is a "pipeline company," as that term is defined in La. R.S. 47:1851 K, which owns "public service property," as that term is used in La. R.S. 47:1851 M. So defined and in accordance with La. Const, art. VII, § 18, the plaintiff is subject to a 25% assessment of fair market value, as determined by the LTC.
To determine whether this ad valorem tax assessment procedure discriminates against interstate commerce, we now examine the Amerada Hess factors. A state tax discriminates against interstate commerce if it: (1) is facially discriminatory; (2) has a discriminatory intent; or (3) has the effect of unduly burdening interstate commerce. Amerada Hess, 490 U.S. at 75, 109 S.Ct. 1617. The plaintiff does not argue that Louisiana's tax assessment procedure has a discriminatory intent; therefore, the second Amerada Hess factor is not at issue. Rather, the plaintiff submits that Louisiana's ad valorem tax scheme violates the first and third factors in that the tax scheme is facially discriminatory or unduly burdensome on interstate commerce.
The assessors respond that the higher tax assessment is not based on whether a natural gas pipeline company is engaged in *343 interstate or intrastate commerce. Rather, the higher assessment is based on whether a natural gas pipeline company is subject to rate regulation, regardless of whether it is engaged in interstate or intrastate commerce. The assessors submit that, where taxation is concerned and assuming no specific federal right is imperiled, states have large leeway to establish classifications that produce a reasonable system of taxation. The right to create classifications, however, is not without restraint, and a classification cannot be maintained if it results in a violation of the United States Commerce Clause.
The United States Supreme Court does not recognize a de minimis defense to a charge of discriminatory taxation under the Commerce Clause. Fulton Corp. v. Faulkner, 516 U.S. 325, 333 n. 3, 116 S.Ct. 848, 133 L.Ed.2d 796 (1996). A court "need not know how unequal the Tax is before concluding that it unconstitutionally discriminates." Maryland, 451 U.S. at 760, 101 S.Ct. 2114. The fact that intrastate as well as interstate commerce may be adversely affected is immaterial to the determination of whether a law is discriminatory for Commerce Clause purposes. Sanifill, Inc. v. Kandiyohi County, 559 N.W.2d 111, 115 n. 3 (Minn.App.1997). Regulations that treat all out-of-state companies in a disparate manner will be treated as discriminatory even though some in-state companies also are adversely affected by the regulation. Kentucky Power Co. v. Huelsmann, 352 F.Supp.2d 777, 786 (E.D.Ky.2005).
In Bacchus Imports, Ltd. v. Dias, 468 U.S. 263, 104 S.Ct. 3049, 82 L.Ed.2d 200 (1984), the Supreme Court struck down as facially discriminatory certain liquor tax exemptions that benefitted two specific, locally produced alcoholic beverages. The tax exemptions applied to some, but not all, locally produced beverages. The court offered, "as long as there is some competition between the locally produced exempt products and non-exempt products from outside the state, there is a discriminatory effect." Bacchus Imports, 468 U.S at 271, 104 S.Ct. 3049. Actual discrimination, wherever it is found, is impermissible, and the magnitude and scope of the discrimination have no bearing on the determinative question of whether discrimination has occurred. Associated Industries of Missouri v. Lohman, 511 U.S. 641, 650, 114 S.Ct. 1815, 128 L.Ed.2d 639 (1994).
More recently, in the matter of In re CIG Field Services Co., 279 Kan. 857, 112 P.3d 138, 150 (2005), the Kansas Supreme Court held that a property tax statute that differentiated between interstate and intercounty natural gas gathering systems and intracounty systems was facially discriminatory under the Commerce Clause. As in the case at hand, there was no differential treatment of certain intrastate entities in comparison to entities in interstate commerce. After a careful study of Supreme Court jurisprudence, the court concluded that "this imperfect discrimination is nevertheless discrimination." CIG, 112 P.3d at 150. Because there exists no de minimis exception to facial discrimination under the United States Commerce Clause, we are compelled to conclude that, in its present state, Louisiana's ad valorem tax scheme facially discriminates against the plaintiff in violation of the Commerce Clause of the United States Constitution.
Facial discrimination against interstate commerce invokes the strictest scrutiny of any professed legitimate local purpose and of the absence of nondiscriminatory alternatives. Hughes v. Oklahoma, 441 U.S. 322, 337, 99 S.Ct. 1727, 60 L.Ed.2d 250 (1979). In 1994, the Supreme Court stated that if a restriction on commerce is discriminatory, it is "virtually per *344 se invalid." Oregon Waste, 511 U.S. at 99, 114 S.Ct. 1345. Once a state law is shown to discriminate either on its face or in practical effect, the burden falls on the state to demonstrate that the statute serves a legitimate local purpose that cannot be achieved in a less discriminatory way. Maine v. Taylor, 477 U.S. 131, 138, 106 S.Ct. 2440, 91 L.Ed.2d 110 (1986). This is an extremely difficult burden placed on taxing authorities, so heavy that facial discrimination by itself may be a fatal defect. Camps Newfound/Owatonna, 520 U.S. at 582, 117 S.Ct. 1590. "Once a state tax is found to discriminate against out-of-state commerce, it is typically struck down without further inquiry." Chemical Waste Management, Inc. v. Hunt, 504 U.S. 334, 342, 112 S.Ct. 2009, 119 L.Ed.2d 121 (1992). Moreover, the record before us offers no adequate proof of either a legitimate local purpose or of the absence of nondiscriminatory alternatives such as might defeat the strict scrutiny accorded a facially discriminatory scheme.[11]
Finding Louisiana's ad valorem tax scheme in its present form is facially discriminatory against natural gas pipeline transportation companies operating in interstate commerce, we must fashion a legal remedy.
The Remedy
Louisiana's ad valorem tax scheme encompasses both constitutional and statutory provisions. As already observed, the plaintiff is a "pipeline company," as defined in La. R.S. 47:1851 K, that owns and owes taxes on "public service property," as that category of property is defined in La. R.S. 47:1851 M. So defined, the plaintiff is subject to an assessment of 25% of fair market value, as determined by the LTC. See La. Const, art. VII, § 18. Other similarly situated, direct competitors operating in intrastate commerce do not meet the definition of "pipeline companies" because they are unregulated. Their properties are not considered "public service properties," and therefore, they are subject to assessments of 15% of fair market value, as determined by the local assessors. See La. Const, art. VII, § 18. It is this discrepancy in classifying some, but not all, similarly situated and competing natural gas pipeline transportation companies as "pipeline companies" that creates the facial discrimination against interstate commerce. In fashioning a legal remedy for the plaintiff, we find it unnecessary to declare the entire ad valorem tax scheme unconstitutional when removal of the limited, offensive provisions of that scheme can accomplish the necessary result.
During oral argument, counsel for the plaintiff suggested that the current discrimination is a result of the amendment to La. Const, art. VII, § 18(B) by 1979 La. Acts No. 799. The preamble to Act 799 provided for "an additional classification of property subject to ad valorem taxation for public service properties as defined by law... and [provided] that the percentage of fair market value applicable for the purpose of determining assessed valuation for such public service properties, excluding land, shall be twenty-five percent." The proposed amendment was presented to, and approved by, the electors of the state of Louisiana at the October 27, 1979, gubernatorial general election. See 1979 La. Acts No. 799, § 2.
In essence, the plaintiff submits this court should remedy the discriminatory treatment imposed upon it by the Louisiana ad valorem tax scheme by ordering the LTC to reduce its tax burden to reflect *345 the 15% assessed valuation applicable to those intrastate natural gas pipelines that are not defined as "pipeline companies" under the ad valorem tax scheme. The plaintiff seeks to maintain its properties' status as "public service properties," thus having its properties centrally valued by the LTC. However, it seeks an assessment of 15% of that value. To grant the plaintiff the relief it requests would be to disregard the clear directives of La. Const, art. VII, § 18. Only "public service properties," subject to an assessment at 25% of fair market value, are to be valued by the LTC. All "other property," subject to an assessment of 15% of fair market value, is to be valued by the local assessors.
The constitution is the supreme law, to which all legislative acts and all ordinances, rules, and regulations of creatures of the legislature must yield. Macon v. Costa, 437 So.2d 806, 810 (La.1983). We decline to strike a Louisiana constitutional provision, approved by the electors of this state, when a fair and equitable result can be reached by striking the statutory provision that creates the discrimination. For these reasons, we turn our attention to the relevant statuteLa. R.S. 47:1851and, in particular, subsections K and M.
We are ever mindful of the presumption that the legislature acts within its constitutional authority in enacting legislation, and courts must construe a statute so as to preserve its constitutionality when it is reasonable to do so. Fruge, 6 So.3d at 128. The unconstitutionality of one or more portions of a law does not render the entire law unenforceable if the remaining portions are severable from the offending portions. Louisiana Associated General Contractors, Inc. v. State, 95-2105 (La.3/8/96), 669 So.2d 1185, 1201; see La. R.S. 24:175 A. Severance requires a determination that the legislature would have passed the act in the absence of the invalid portion. Thus, the issue is would the legislature have passed La. R.S. 47:1851 had the legislation been presented with the invalid features removed? See Louisiana Associated, 669 So.2d at 1201. Where the purpose of the statute is defeated by the invalidity of part of the act, the entire act is void. Louisiana Associated, 669 So.2d at 1201. Conversely, however, when the general objectives of the act can be achieved without the invalid part, the remaining parts of the act will be upheld. Louisiana Associated, 669 So.2d at 1201; see also World Trade Center Taxing Dist. v. All Taxpayers, Property Owners, XXXX-XXXX (La.6/29/05), 908 So.2d 623, 637-638.
Louisiana Revised Statutes 47:1851, subsections K and M, were enacted by 1976 La. Acts No. 703, § 1 (prior to 1979 La. Acts No. 799, which amended La. Const, art. VII, § 18(B)). Section 4 of Act 703 specifies:
If any provision or item of this Act or the application thereof is held invalid, such invalidity shall not affect other provisions, items, or applications of this Act which can be given effect without the invalid provisions, items, or applications, and to this end, the provisions of this Act are declared to be severable.
Louisiana Revised Statutes 47:1851 need not be stricken in its entirety. It is the definition of "pipeline company" found in subsection K that results in disparate treatment between interstate and some intrastate pipeline companies. Thus, we are compelled to conclude that subsection K is unconstitutional and in violation of the Commerce Clause. So concluding necessitates a declaration that inclusion of "pipeline company" in La. R.S. 47:1851 M is unconstitutional and in violation of the Commerce Clause, and the phrase "pipeline company" should be stricken from La. R.S. 47:1851 M. The remaining portions of La. R.S. 47:1851 are independent and *346 capable of being given effect without reference to the invalid portions. Thus, the remaining part of La. R.S. 47:1851 M and other provisions of La. R.S. 47:1851 (excluding subsection K) are severable and valid. As a result of these declarations, the plaintiffs properties will be classified as "other properties" for purposes of Louisiana's ad valorem tax scheme and will be assessed in compliance with La. Const, art. VII, § 18 at 15% of fair market value as determined by the assessors of the parishes within which the plaintiffs properties are located.[12]
The plaintiff submits that upon remand for de novo assessment by the local assessors, the local assessors will be motivated to arrive at higher valuations than those set by the LTC. We find the plaintiffs contention unpersuasive. At the hearing on the motion for summary judgment, the plaintiff offered into evidence, without objection, the affidavit of Nancy Heller Hughes. Ms. Hughes attested that she is an Accredited Senior Appraiser of public utility property. Although the LTC and the local assessors use different valuation methods, Ms. Hughes concluded:
Fair market value is fair market value. If applied properly to reflect all forms of depreciation (physical, functional and economic), the cost approach used by local parish assessors should produce similar results as the correlated cost and income approaches used by the Louisiana Tax Commission to assess the value of public service property.
Moreover, the local assessors' valuations of properties are not unbridled. Article VII, § 18(D) requires that "[f]air market value and use value of property shall be determined in accordance with criteria which shall be established by law and which shall apply uniformly throughout the state." Like the plaintiff herein, the plaintiff in ANR Pipeline advanced a similar argument.[13] This court noted that the assessors are required, pursuant to La. R.S. 47:1992 A(1), to prepare a list showing the assessment of immovable and movable property of the affected companies in and for the parish or district and expose the list daily for inspection by the plaintiff and any other interested parties for a period of fifteen days. ANR Pipeline, 923 So.2d at 97. Thereafter, the lists shall be certified to the board of review within three days in *347 accordance with La. R.S. 47:1992 B. Accordingly, the plaintiff herein "will have ample opportunity to object, if necessary, to the local assessors' valuations." See ANR Pipeline, 923 So.2d at 97-98.
So concluding, we agree with the district court that the proper remedy is a remand to the LTC so that it can allow the parish assessors to assess the value of the plaintiffs properties for tax year 2006 and calculate taxes based on 15% of those assessments. Such relief complies with the mandates of La. Const, art. VII, § 18 and ensures that all natural gas pipeline companies, those operating intrastate and interstate, are treated identically. There will exist no differential treatment of in-state and out-of-state economic interests that benefits the former and burdens the latter. See Oregon Waste, 511 U.S. at 99, 114 S.Ct. 1345. A remand for reassessment, both as to rate and methodology, of properties owned by the plaintiff is a "just and equitable" remedy. See ANR Pipeline, 923 So.2d at 98; Transcontinental Gas, 2005-2604, 2005-2605 at p. 6 (unpublished).
CONCLUSION
For the foregoing reasons, we affirm that portion of the district court judgment partially granting the motion for summary judgment filed on behalf of the Assessors of Acadia, Cameron, East Baton Rouge, Iberia, Jefferson Davis, Lafourche, St. Landry, St. Martin, St. Mary, Vermilion, and Washington parishes, and ordering that ad valorem taxes on all pipeline property (whether operated in interstate or intrastate commerce) must be calculated at 15% of fair market value as determined by the assessors of the parishes within which the plaintiffs properties are located. We reverse that part of the district court judgment declining to consider the constitutionality of La. R.S. 47:1851 and render judgment declaring La. R.S. 47:1851 K unconstitutional and in violation of the Commerce Clause of the United States Constitution. We further render judgment declaring that inclusion of the phrase "pipeline company" in La. R.S. 47:1851 M is unconstitutional and in violation of the Commerce Clause of the United States Constitution; so finding, we order the phrase "pipeline company" be stricken from La. R.S. 47:1851 M. The relief requested in the answer filed by the Louisiana Tax Commission is denied. The parties to this appeal are to bear their own costs.
JUDGMENT AFFIRMED IN PART; REVERSED IN PART; AND RENDERED. ANSWER TO APPEAL DENIED.
NOTES
[1] Although the facts are fairly simple, the same cannot be said for the procedural history of this complex consolidated district court proceeding. Discrepancies in the pleadings and unusual legal process have created what can best be described as a legal labyrinth.
[2] In its petition, the plaintiff also challenged the ad valorem tax scheme under the Equal Protection and Due Process Clauses of the United States and Louisiana Constitutions, and the Uniformity Clause of the Louisiana Constitution. During oral argument, counsel for the plaintiff confirmed that the sole issue before this court is whether the Louisiana ad valorem tax scheme violates the Commerce Clause of the United States Constitution.
[3] The sheriffs and assessors named as defendants in this suit are: Sheriff Wayne Melancon, Acadia Parish; Sheriff Mike Waguespack, Assumption Parish; Sheriff Tony Mancuso, Calcasieu Parish; Sheriff Theos Duhon, Cameron Parish; Sheriff Greg Phares, East Baton Rouge Parish; Sheriff Sid Hebert, Iberia Parish; Sheriff Brent Allain, Iberville Parish; Sheriff Richard Edwards, Jr., Jefferson Davis Parish; Sheriff Michael Neustrom, Lafayette Parish; Sheriff Craig Webre, Lafourche Parish; Sheriff Paul Raymond Smith, Pointe Coupee Parish; Sheriff Gregory Champagne, St. Charles Parish; Sheriff Ronald Ficklin, St. Helena Parish; Sheriff Bobby Guidroz, St. Landry Parish; Sheriff Ronald J. Theriot, St. Martin Parish; Sheriff David A. Naquin, St. Mary Parish; Sheriff Daniel Edwards, Tangipahoa Parish; Sheriff Michael Couvillon, Vermilion Parish; Sheriff Aubrey Jones, Washington Parish; and Sheriff Mike Cazes, West Baton Rouge Parish, in their capacities as ex officio tax collectors in and for their respective parishes. Hon. Russel L. Benoit, Acadia Parish; Hon. Wayne P. Blanchard, Assumption Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. James H. Dupont, Iberville Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Conrad Comeaux, Lafayette Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. James A. Laurent, Pointe Coupee Parish; Hon. Clyde A. Gisclair, St. Charles Parish; Hon. Wesley Blades, St. Helena Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Joaquin Matheu, Tangipahoa Parish; Hon. Michael Langlinais, Vermilion Parish; Hon. M. Randall Seal, Washington Parish; and Hon. Barney Altazan, West Baton Rouge Parish, in their capacities as assessors in and for their respective parishes.
[4] The twelve assessors named as defendants who joined in answering the petition were: Hon. Russel L. Benoit, Acadia Parish; Hon. Richard J. Cole, Jr., Calcasieu Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Michael Langlinais, Vermilion Parish; and Hon. M. Randall Seal, Washington Parish. Although not named as a defendant in this litigation, an answer also was filed on behalf of Hon. Gene P. Bonvillain, assessor of Terrebonne Parish.
[5] The eleven assessors named as defendants who joined in the motion for summary judgment were: Hon. Russel L. Benoit, Acadia Parish; Hon. Robert E. Conner, Cameron Parish; Hon. Brian Wilson, East Baton Rouge Parish; Hon. Rickey J. Huval, Sr., Iberia Parish; Hon. Donald G. Kratzer, Jefferson Davis Parish; Hon. Michael H. Martin, Lafourche Parish; Hon. Rhyn L. Duplechain, St. Landry Parish; Hon. Lawrence Patin, St. Martin Parish; Hon. Sherel A. Martin, Jr., St. Mary Parish; Hon. Michael Langlinais, Vermilion Parish; and Hon. M. Randall Seal, Washington Parish. Joining in the motion was the Hon. Gene P. Bonvillain, assessor of Terrebonne Parish, who answered the petition but was not named as a defendant. The Hon. Richard J. Cole, Jr., assessor of Calcasieu Parish, who joined with the other movers in answering the petition, did not join in the motion for summary judgment.
[6] The answer does not identify the parish with which Sheriff Sidney Gautreaux is affiliated.
[7] Clearly the reference to docket number 551,432 is a typographical error, as the judgment is captioned "JUDGMENT IN DOCKET NO. 551,435." Notably, the judgment is not entered in favor of the Hon. Gene P. Bonvillain, Assessor of Terrebonne Parish, who answered the petition and joined in the motion but was not named by the plaintiff as a defendant.
[8] To the extent this court may lack appellate jurisdiction over all of the issues raised on appeal, we exercise our supervisory jurisdiction and consider the merits of the plaintiff's claims. See Hood v. Cotter, XXXX-XXXX, XXXX-XXXX (La.12/2/08), 5 So.3d 819, 823-824.
[9] A facially discriminatory tax may survive Commerce Clause scrutiny if it is, in fact, a compensatory tax designed to make interstate commerce bear a burden already borne by intrastate commerce. The state bears the burden of showing that the requirements of the compensatory tax doctrine are clearly met. Fulton Corp. v. Faulkner, 516 U.S. 325, 331, 344, 116 S.Ct. 848, 133 L.Ed.2d 796 (1996). Herein, no argument has been advanced, nor evidence presented, that the ad valorem tax is a justifiable compensatory tax. Notably, the Supreme Court has stated that there is "doubt that such a showing can ever be made outside the limited confines of sales and use taxes." Fulton, 516 U.S. at 344, 116 S.Ct. 848.
[10] As noted by the Alabama Supreme Court in Ex parte Hoover, Inc., 956 So.2d 1149, 1153 (Ala.2006), dormant Commerce Clause analysis is not without criticism. See e.g., Camps Newfound/Owatonna, Inc. v. Town of Harrison, 520 U.S. 564, 610, 117 S.Ct. 1590, 137 L.Ed.2d 852 (1997) (Thomas, J., joined by Rehnquist, C.J., and Scalia, J., dissenting) ("The negative Commerce Clause has no basis in the text of the Constitution, makes little sense, and has proved virtually unworkable in application.").
[11] A finding of facial discrimination eliminates the need for this court to evaluate whether the third Amerada Hess factor (undue burden on interstate commerce) is present.
[12] The plaintiff observes that airline and railroad companies, although classified as owning "public service properties," are assessed at the lower 15% assessment of fair market value as determined by the LTCnot the local assessors. The United States Congress has elected to treat airline and railroad companies differently from pipeline companies. Specific federal legislation has been passed in regard to taxation of airline and railroad companies. See 49 U.S.C. § 40116(2)(A); 49 U.S.C. § 11501(b). We are unaware of similar federal legislation in favor of natural gas pipeline companies. Moreover, because the plaintiffs properties will no longer be classified as "public service properties" for purposes of La. Const, art. VII, § 18, the plaintiffs arguments regarding the alleged disparity in treatment between itself and other owners of "public service properties" is moot.
[13] In ANR Pipeline, this court evaluated the Louisiana ad valorem tax scheme in the context of equal protection and uniformity challenges. Therein, interstate natural gas pipeline companies that met the definition of "pipeline companies" owning "public service properties" were not being appraised and assessed in the same manner as intrastate pipeline companies that also met the definition of "pipeline companies" owning "public service properties." Rather, the intrastate companies were being assessed as if they owned non-public service properties. This court determined that the appropriate remedy for a denial of uniformity in taxation "is to employ the same valuation and assessment methodology as that used to assess the preferred properties." ANR Pipeline, 923 So.2d at 97. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/94788/ | 168 U.S. 627 (1898)
HIGHLAND AVENUE AND BELT RAILROAD COMPANY
v.
COLUMBIAN EQUIPMENT COMPANY.
No. 427.
Supreme Court of United States.
Submitted November 29, 1897.
Decided January 8, 1898.
CERTIFICATE FROM THE CIRCUIT COURT OF APPEALS FOR THE FIFTH CIRCUIT.
*629 Mr. Alexander T. London and Mr. Samuel A. Putnam for Highland Avenue Belt Railroad Company.
Mr. John F. Martin and Mr. Henry D. Hotchkiss for Columbian Equipment Company.
MR. JUSTICE BREWER, after stating the case, delivered the opinion of the court.
Is an interlocutory order appointing a receiver appealable from the Circuit Court to the Circuit Court of Appeals? And if such an order, standing alone, be not appealable, does it become so by the incorporation into it of a direction to the defendant, its officers, directors, agents and employés, to turn over and deliver to the receiver the property in their hands? These questions must be determined by a consideration of section 7 of the act of March 3, 1891, c. 826, creating Circuit Courts of Appeal, 26 Stat. 517, as amended February 18, 1895, c. 96, 28 Stat. 666. The section provides
"That where, upon a hearing in equity in a District Court or a Circuit Court, an injunction shall be granted, continued, *630 refused or dissolved by an interlocutory order or decree, or an application to dissolve an injunction shall be refused in a case in which an appeal from a final decree may be taken under the provisions of this act to the Circuit Court of Appeals, an appeal may be taken from such interlocutory order or decree granting, continuing, refusing, dissolving or refusing to dissolve an injunction to the Circuit Court of Appeals: Provided, That the appeal must be taken within thirty days from the entry of such order or decree, and it shall take precedence in the appellate court; and the proceedings in other respects in the court below shall not be stayed unless otherwise ordered by that court during the pendency of such appeal: And provided further, That the court below may in its discretion require, as a condition of the appeal, an additional injunction bond."
Under this section it has been decided that when an appeal is taken from an interlocutory order or decree granting or dissolving an injunction the whole of such interlocutory order or decree is before the Court of Appeals for review, and not simply that part which grants or dissolves the injunction, and that on the hearing in the Court of Appeals that court may consider and decide the case upon its merits. Smith v. Vulcan Iron Works, 165 U.S. 518; In re the Tampa Suburban Railroad Company, ante, 583. But each of those cases proceeded upon the fact that there was a distinct order granting, continuing or dissolving an injunction. In the case at bar there is no such order. It is true, following the order of appointment, there is a direction to the defendant, its officers, directors and agents, to turn over to Campbell the property of which he is appointed receiver, but that is only incidental and ancillary to the receivership. This is obvious; for if the court subsequently entered an order, in terms setting aside only the appointment of the receiver, all the other parts of the original order would immediately and without specific mention disappear and cease to have any force. Indeed, the mere appointment of a receiver carries with it the duty on his part of taking possession, and the further duty of those in possession of yielding such possession. So that while as a part of an *631 order appointing a receiver there is something in the nature of a mandatory injunction, that is a command to the receiver to take and to the defendant to surrender possession, yet such command is not technically and strictly an order of injunction.
The last proviso in the section emphasizes this distinction: "The court below may in its discretion require, as a condition of the appeal, an additional injunction bond." The bond is described. It is not a bond to secure against injuries which may result if a receiver is wrongfully appointed or discharged, but is technically an injunction bond; that is, a bond to answer for damages in case of a wrongful order either granting, continuing or vacating an injunction. Receivership implies possession, and if no bond can be required to guard against loss from taking or surrendering possession it is difficult to perceive the significance of an additional injunction bond in a receivership case. The question is not, whether included in an order appointing a receiver, there may not be, either expressed or implied, some directions of a mandatory character, something in the nature of an injunction, but whether Congress in this legislation provided for appeals in cases other than those in which an injunction, technically speaking, is either the sole or a principal part of the order or decree. Orders granting injunctions and orders appointing receivers are, in the common understanding of the profession, entirely independent. The distinction between the two is clearly recognized in the text books and in the reports. We have separate treatises on injunctions and on receivers. The separation between them is one which runs through the law, and while it is true that the mandatory features which, either expressly or by implication, attend orders appointing receivers, are sometimes made the matter of discussion in treatises on receivers, or the subject of comment in decisions concerning receivers, yet the distinction is never forgotten. Familiar, as it must be assumed to have been, with this generally recognized distinction, Congress, if it had intended that appeals should be allowed from orders appointing receivers, as from orders in respect to injunctions, would doubtless have expressly named such orders. Its omission of the one and the mention *632 of the other is a clear declaration that only one should be the subject of appeal and the other not. And it would savor of judicial legislation to hold that, although Congress has not authorized appeals from orders appointing receivers, the mere fact that in such an order there is a direction of a mandatory character, either expressed or implied, in respect to taking possession, makes it appealable, as an order granting an injunction.
For these reasons we are of opinion that the question should be answered in the negative, and it will be so certified to the Court of Appeals. | 01-03-2023 | 04-28-2010 |
https://www.courtlistener.com/api/rest/v3/opinions/1614338/ | 23 So.3d 727 (2009)
PECORA
v.
BERLIN.
Nos. 3D09-594, 3D09-1343.
District Court of Appeal of Florida, Third District.
October 28, 2009.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614349/ | 939 So.2d 1126 (2006)
A.D., a juvenile, Appellant,
v.
The STATE of Florida, Appellee.
No. 3D06-629.
District Court of Appeal of Florida, Third District.
October 4, 2006.
*1127 Bennett H. Brummer, Public Defender, and Howard K. Blumberg, Assistant Public Defender, for appellant.
Charles J. Crist, Jr., Attorney General, and Juliet S. Fattel, Assistant Attorney General, for appellee.
Before GERSTEN, FLETCHER, and ROTHENBERG, JJ.
ROTHENBERG, Judge.
A.D., a juvenile, appeals the trial court's order adjudicating him delinquent and the denial of his motion to suppress evidence seized as a result of his arrest. We affirm.
A.D. was observed by law enforcement in a business area on Main Street in Miami Lakes at approximately 8:59 p.m. It is undisputed that some of the businesses were open at the time, and that the area is marked with signs which provide that the business owners have authorized law enforcement to prevent individuals from loitering or trespassing. While there was conflicting evidence as to exactly what occurred during A.D.'s encounter with the police, it is undisputed that A.D. was asked to leave and when he became agitated, he was asked to step off to the side to speak to an officer, who explained to A.D. that he was obstructing a walk-way on private property and that the officer was authorized by the owner of the property to prevent loitering. When A.D. refused to leave, he was arrested. A search incident to the arrest revealed a Xanax pill in the pocket of A.D.'s shorts.
A.D. argues that he was not trespassing and that his detention was unlawful as law enforcement lacked reasonable articulable suspicion that A.D. was trespassing or engaged in any other criminal activity to justify an investigatory stop. As we conclude that the encounter with A.D. did not rise to the level of an investigatory *1128 stop requiring reasonable suspicion of criminal activity, we affirm.
There are three levels of law enforcement/citizen encounters: (1) consensual encounters where the citizen is free to leave and no constitutional safeguards are invoked; (2) investigatory stops ("Terry stops") where a citizen may be temporarily detained and which requires a well-founded articulable suspicion that the person has committed, is committing, or is about to commit a crime; and (3) an arrest, which must be supported by probable cause. Popple v. State, 626 So.2d 185, 186 (Fla.1993).
A.D. argues that when he was asked to move to another area for further questioning, what may have begun as a consensual encounter, turned into an investigatory stop requiring reasonable suspicion. We disagree. The Fourth Amendment prohibition against unreasonable searches and seizures is not implicated when an encounter with the police is found to be consensual. Whether a particular encounter is consensual requires consideration of all of the facts and circumstances surrounding the encounter and hinges on whether the circumstances would communicate to a reasonable person that he/she is free to leave and terminate the encounter. Florida v. Bostick, 501 U.S. 429, 439, 111 S.Ct. 2382, 115 L.Ed.2d 389 (1991); Taylor v. State, 855 So.2d 1, 15 (Fla.2003). Under the facts and circumstances in this case, law enforcement was not attempting to detain A.D. To the contrary, they were attempting to convince him to leave. A.D., therefore, could not reasonably argue that he or any reasonable person would have felt that he/she could not leave. The consensual encounter unfortunately turned into a valid arrest after A.D. was asked three times to leave by the officer, and refused to do so, thus elevating the consensual encounter to an arrest for trespass after warning.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614436/ | 23 So.3d 1190 (2009)
THOMPSON
v.
STATE.
No. 2D09-4943.
District Court of Appeal of Florida, Second District.
December 14, 2009.
Decision Without Published Opinion Appeal dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614448/ | 416 Mich. 510 (1982)
331 N.W.2d 159
THE DETROIT EDISON COMPANY
v.
PUBLIC SERVICE COMMISSION
ATTORNEY GENERAL
v.
PUBLIC SERVICE COMMISSION
Docket Nos. 61294, 61295. (Calendar No. 4).
Supreme Court of Michigan.
Argued June 5, 1979.
Decided December 23, 1982.
Foster, Swift, Collins & Coey, P.C. (by Theodore *514 W. Swift and David W. McKeague), and Leon S. Cohan for The Detroit Edison Company.
Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, and Arthur E. D'Hondt and James E. Riley, Assistants Attorney General, for the Public Service Commission.
Frank J. Kelley, Attorney General, Louis J. Caruso, Solicitor General, and Hugh B. Anderson and Roderick S. Coy, Assistants Attorney General, for the Attorney General.
Conner, Harbour & Dew (by P.D. Connor) and James D. Irvine for intervening defendant Ford Motor Company.
Decided December 23, 1982. Rehearing denied 417 Mich 1133.
FITZGERALD, C.J. (for affirmance).
In our order granting leave to appeal, we stated as the first issue whether "the charge allowed by the fuel cost adjustment clause [is] a charge to recover past costs, or a charge based on past experience reflected in a current charge".[1] The answer to this question is decisive in resolving all of the issues presented in this case.
The cornerstone of the position taken by Edison, and accepted by the opinion for reversal, is that the FCAC adopted in February 1974 was intended to impose a fuel adjustment in the billing month to recover fuel costs incurred two months before. If that is the way the clause operated, then the December 1974 and January 1975 fuel costs had not yet been billed when the MPSC changed the FCAC in February 1975.
On the other hand, if, as the MPSC maintains, the FCAC was designed to impose a fuel adjustment in the billing month as an estimate of fuel *515 costs based on prior experience, then Edison did not suffer any gap in collection of fuel costs in the months in question because the December 1974 and January 1975 billings included the fuel costs for those months.
We think it is clear that the February 1974 FCAC used prior costs as an estimate of current costs, and would affirm.
I
Three features of the FCAC demonstrate that it was not designed to recover all past costs, but was intended only to estimate current costs on the basis of past experience.
First, the FCAC based its adjustment on the consumption of electricity in the billing month, not on consumption in the prior month whose fuel costs were used. If the superseded FCAC was intended to produce a dollar-for-dollar recovery of excess fuel costs, it would have applied the adjustment factor on the basis of actual fuel costs in a given month to the amount of energy used by a customer in that month. However, the superseded FCAC applied the adjustment factor to the amount of energy used in the billing month, which was one or two months after the month in which the fuel was used. Consequently, there never would be an exact match of excess fuel costs and FCAC billings unless energy use in the cost month was the same as energy use in the billing month. Any variation would lead to a corresponding over- or undercollection of fuel expenses. Similarly, individual Edison customers were never billed the actual cost of the energy they had used; rather, they were billed an amount based on a formula using an earlier month's costs and current month's usage.
*516 A second feature of the FCAC that demonstrates that it was a charge for estimated fuel costs in the billing month is that customers leaving Edison were not assessed an additional charge for the excess fuel costs in their last two months of service, nor were new customers excused from paying the adjustment charge for their first two months of service. If, as Edison and the opinion for reversal contend, the superseded FCAC was in fact a charge to recover past costs, customers leaving Edison would avoid paying for fuel they used and new customers would be forced to pay for fuel charges incurred before they received service.
Finally, perhaps the clearest evidence that the FCAC was not designed to recover past costs is the fact that the superseded FCAC was applied in the month following its inception. The fuel clause became effective February 4, 1974, and Edison first applied it to residential customers in its March 1974 bills.[2] Under the fuel clause formula, the adjustment was based on January 1974 costs. Using the analysis of the opinion for reversal and Edison, the March bill was a deferred charge for January's costs. However, Edison had already collected all it was entitled to for January under its pre-FCAC rate structure. Thus, application of the February 1974 FCAC to collect for costs incurred in January 1974 would have meant that Edison was collecting more for January than was authorized under the rate structure in effect in January, the clearest possible kind of prohibited retroactive ratemaking.[3] Only if the billings in March 1974 *517 were meant to charge for March fuel costs, estimated with the actual January data, could the FCAC be permissible prospective ratemaking.
The opinion for reversal says that with the change in the FCAC in February 1975, "Edison was entitled to collect at some time for December and January as such." As the foregoing analysis of the FCAC demonstrates, Edison did collect for December 1974 and January 1975 in its December 1974 and January 1975 billings. There was no gap in Edison's billing of fuel costs recoverable under its FCAC.[4]
II
Litigation over whether fuel adjustment clauses are deferred or current charges has been fairly common in federal courts. Indeed, those courts have developed a standard terminology for characterizing the two kinds of systems, referring to a fuel clause that recovers all past costs as a "cost of service" tariff, and to a clause that uses past costs to estimate current ones as a "fixed rate" tariff.[5]
*518 We find several cases from the United States Courts of Appeals dealing with very similar facts persuasive authority for finding the superseded Edison FCAC to have been a fixed-rate tariff, designed to estimate current costs on the basis of past experience.
Boston Edison Co v Federal Energy Regulatory Comm, 611 F2d 8 (CA 1, 1979), is a case factually very similar to the instant case. Boston Edison appealed an order of the Federal Energy Regulatory Commission that had struck down a surcharge to cover fuel cost expenses allegedly left unrecovered when Edison converted from a two-month lag billing formula to a current month formula. The First Circuit noted that under the former fuel clause, fuel costs from one month were applied to energy use in the second succeeding month. Thus, the old clause was not designed to achieve dollar-for-dollar recovery as would a true cost of service tariff. The Court also noted that Edison failed to assess additional charges on customers leaving the system as would be expected under a true deferred billing system. The Court therefore concluded that the fuel clause was a fixed-rate tariff and, therefore, no surcharge could be allowed. Both of the reasons underlying the First Circuit's decision are present in the instant case.
In Public Service Co of New Hampshire v Federal Energy Regulatory Comm, 195 US App DC 130; 600 F2d 944 (1979), cert den 444 US 990; 100 S Ct 520; 62 L Ed 2d 419 (1979), four electric companies sought review of the commission's orders refusing to allow surcharges to compensate for alleged uncompensated fuel costs to which the companies claimed to have become entitled when *519 they switched from fuel clauses based on fuel costs in the billing month rather than for some prior period. Two of the companies had fuel clauses based on fuel costs from two months preceding the billing month, which coincides with the system used in the fuel clauses in the instant case. As did Edison in the present case, the companies began billing under the superseded clauses immediately after they became effective.
The District of Columbia Circuit held that the fuel clauses were fixed-rate tariffs primarily on the basis of two facts. The first was that the formulas mismatched the costs from an earlier month with the power consumption in the billing month.
"Thus, the fuel adjustment charge that was used was not based on the cost of fuel that had been used to generate the power for which users were billed. Since customer usage varies from month to month, this mismatch applying a fuel adjustment factor based on one month to kilowatt-hours used during another month would not lead to exact recovery of actual fuel expenses. Thus, the superseded clauses did not simply defer recovery of the cost of fuel. The clauses brought about a charge that differed from actual cost. This result is inconsistent with petitioners' claim that the clauses were cost of service tariffs with deferred billing. But the result squares with the Commission's view that the clauses were fixed rate tariffs which used fuel costs in a prior period as a proxy for actual current costs." (Emphasis in original; footnote omitted.) 195 US App DC 138-139; 600 F2d 952-953.
Second, the Court said that the companies' billing was not actually deferred because they began billing immediately after the clauses became effective, rather than waiting until the "billing lag" had elapsed.
The District of Columbia Circuit concluded that *520 the fuel clauses were fixed-rate tariffs and, accordingly, the refusal to impose surcharges was proper. Again, the reasons supporting the Court's decision apply with equal force to the facts of the case before us.
In two other cases, Virginia Electric & Power Co v Federal Energy Regulatory Comm, 580 F2d 710 (CA 4, 1978), and Jersey Central Power & Light Co v Federal Energy Regulatory Comm, 589 F2d 142 (CA 3, 1978), the federal courts were again presented with alleged unbilled fuel expense resulting from a superseded fuel clause. The principal issue was whether the old clause was designed to collect actual expenses on a deferred basis or to collect an approximation of current costs based on past experience. Each Court held that the superseded fuel clause before them fell within the latter category.
Both Courts noted that new customers began paying the adjustment immediately and that customers leaving the system were not billed for deferred charges. In addition, the Fourth Circuit pointed out that the company billed adjustments in the first month the fuel clause became effective and that these initial adjustments could not legally have represented charges for past service.
The FCAC in the Third Circuit case, like Edison's, required the adjustment factor to be applied to energy used during the billing month. The Court noted that this was inconsistent with the utility's contention that the charge was a pass-on of actual past costs incurred. In order to achieve that result, the Court said that the billing should have been computed on the basis of energy use in the month in which the fuel expenses were actually incurred.
The Third Circuit Court of Appeals also thought it significant that the FCAC used a formula, as *521 this was inconsistent with the utility's argument that an assessment of actual cost was intended. Nor did the fact that the formula was based on costs of a past period, the Court said, prevent it from being used as the basis for a current charge.
"The fact that the formula was based on costs in a preceding period did not change its effect of providing a method to calculate a current charge rather than to exact a precise recovery of past expenses. Such a formula could as well have been based, for example, on some past wholesale price index or similar factor rather than actual cost incurred, and yet be the basis for a `current' charge." 589 F2d 145.
All of the factors which led to the Courts' decisions in these two cases are present here. As explained more fully above, Edison's new customers began paying immediately and customers leaving the system were not billed for deferred charges; Edison billed adjustments in the month after the fuel clause became effective; Edison's superseded FCAC required the adjustment factor to be applied to energy used during the billing month rather than the fuel cost incurrence month; and, Edison's superseded FCAC used a formula based on costs of a past period.[6]
*522 III
We think the concern that Edison has not been able to recover all of its costs misses the point. Certainly it is true that in this case Edison's total FCAC charges were less than its excess fuel costs. However, that is simply one of the risks that any utility operating under our regulatory system takes.[7] Rates are set on the basis of estimates of costs, typically based on a "test year" or other period,[8] which is sometimes adjusted on the basis *523 of predictions as to future trends and events that will affect costs.[9] In the case of Edison's February 1974 rates, the FCAC provided a further device for improving the estimates on which the billings were based. But the essential principle of the rule against retroactive ratemaking is that when the estimates prove inaccurate and costs are higher or lower than predicted, the previously set rates cannot be changed to correct for the error; the only step that the MPSC can take is to prospectively revise rates in an effort to set more appropriate ones.[10] The MPSC's adoption of the lag-adjustment factor in February 1975 was simply one more effort to better estimate current costs in future billings.[11]
*524 The applicable statute[12] did not create a right of the utility to have any particular kind of fuel adjustment clause; it merely authorized the MPSC to use such clauses. Thus, Edison is entitled to whatever the MPSC-approved FCAC provided. Analysis of the operation of the FCAC in question and examination of the most relevant authorities compels the conclusion that Edison's February 1974 FCAC did not entitle it to a dollar-for-dollar recovery of excess fuel costs. It provided a specific method of calculating adjustments based on excess fuel costs in prior months. Edison has used the formula to collect the appropriate amounts, and it is entitled to no more.
The Court of Appeals judgment should be affirmed.
WILLIAMS and RYAN, JJ., concurred with FITZGERALD, C.J.
LEVIN, J. (for reversal).
On February 4, 1974, the Michigan Public Service Commission authorized *525 the Detroit Edison Company to include in its rate structure a fuel adjustment clause for domestic service;[1] the order provided that "[t]he adjustment shall apply to the second billing month following the calendar month in which the fuel is burned".[2]
On July 29, 1974, the commission entered an order authorizing and directing Edison to adopt revised accounting procedures so that costs or credits subject to later billing are "deferred" until reflected in billing adjustments without increase in rate base or cost of service for ratemaking purposes and with proper disclosure in the financial statements of the company.[3] This meant that Edison *526 could set up on its balance sheet as an asset the "deferred" fuel expense to be collected two months hence.
On February 3, 1975, the commission granted Edison a rate increase, and, at the same time, on its own initiative, decided that the billing lag should be eliminated because the fuel cost adjustment clause did not "in fact achieve the goal of fully recognizing the changes in fuel costs in a timely manner. Therefore the commission finds it necessary to correct the operation of the clause to reduce the existing time lag between the incurring and the reflecting of increased or decreased costs of fuel in the fuel adjustment. This lag has become a significant problem with rapidly escalating cost of fuels and with the potential assessment of proposed new taxes on these fuels."
The February 3 order went on to state that the commission was revising "the procedure used in determining the appropriate billing month adjustment factor so as to effectively eliminate the lag. This should be accomplished using actual figures as the basis for calculation of the adjustment factor."[4]
*527 The February 3 order also provided that the elimination of the lag "removes the need" for Edison to account for deferred fuel costs as directed in July, 1974, and, therefore, Edison "should file an application with the commission for a determination in a separate proceeding as to disposition of the accumulated fuel cost deferral up to the effective date of this order."
On December 22, 1975, the commission entered an order finding that Edison's actual fuel costs in December 1974 and January 1975 exceeded the amount it could recover under the fuel cost adjustment clause by $26,349,806. The commission observed that Edison had not asserted that it is entitled to recover the $26,349,806 "because of the accounting treatment" (emphasis in original) authorized in July 1974, but asserted rather that the accounting entries resulting from that order "simply serve as the device for measuring the amount of fuel costs actually incurred which were not collected by [Edison] from its customers prior to February 3, 1975". The commission concluded that it was "inherent in [Edison's] previous fuel clause that the full amount of fuel expenses would not be collected if fuel costs rose above the base fuel cost without at some subsequent time falling below the base cost. The only effect of Case No. F-647 [decided by the order dated July 29, 1974] was to display the undercollection separately in Account 174."
*528 "So understood, it is evident that [Edison] in effect requests the commission to retroactively revise the fuel clause which was in existence prior to February 3, 1975. The purpose of that revision would be to permit [Edison] to recover dollar for dollar its actual fuel expenses, even though the clause as originally adopted did not permit complete and total recovery in a period of steady [sic] rising fuel costs."
Finally, the commission said it was "aware of the potential for negative consequences for [Edison] if those accumulations are written off in too short a period. Consequently, the commission finds that the $26,349,806 should be written off against net income over a period of 10 years."
Edison and the Attorney General filed actions in the circuit court for review of this order. The circuit court vacated the commission order and remanded to the commission with directions to enter an order as proposed by the hearing referee allowing collection of the $26,349,806 over a 12-month period. The commission complied with that direction on October 1, 1976. The collection of the surcharge[5] proceeded while the appeals by the Attorney General and the commission from the circuit judge's decision were pending.
On March 20, 1978, the Court of Appeals reversed and directed the circuit court to remand the cause to the commission for such further action as was necessary.
We granted leave to appeal.[6]
*529 I
The Court of Appeals focused on the July 29, 1974, order concerning the accounting treatment of "deferred fuel costs". It said that the commission order in that proceeding did not set rates but, rather, was limited to accounting procedures. The effect of that order was merely to create a "paper" asset, and that bookkeeping entry does not entitle Edison to additional revenues.[7]
Edison did not contend, however, that it was entitled to collect for the two-month lag because it had been authorized to show the amount thereof as an asset on its books. The commission's order of December 22, 1975, acknowledged that Edison made no such claim. The accounting procedures authorized by the commission, rather, simply recognized that Edison spent more money for fuel during the relevant period than it had collected under the fuel adjustment clause.
II
It is urged that under the February 3, 1975 revised fuel adjustment clause the amount to be collected in February and March 1975 includes the December 1974 and January 1975 fuel adjustment amounts of $26,349,806. Edison responds that the fuel adjustment clause, as revised on February 3, 1975, merely authorizes use of the December and January amounts for the purpose of computing *530 what is owing for February and March. Merely that the amount so to be calculated is to be partly based on December and January does not mean that Edison has collected for December and January. But, says the commission and the Attorney General, Edison was still authorized to collect for December and January in February and March. Not so, says Edison, we were only authorized to collect February and March costs computed on the basis of December and January, and never collected for December and January. But the commission and the Court of Appeals say that those are just paper entries, and that Edison still collected a sum of money equal to the December and January costs.
We agree with Edison. Once the commission authorized the fuel adjustment clause in February 1974, and then decided in February 1975 to eliminate the billing lag and that was what the commission said it was doing Edison was entitled to collect at some time for December and January as such. Although February and March were to be calculated on the basis of December and January, Edison never was paid for December and January as such.
The commission's order of December 22, 1975, states in effect that Edison cannot complain because it never was supposed to collect the $26,349,806. It would always be some amount behind and would never catch up. The only way that it could catch up would be if fuel costs fell to the base level.[8]
*531 The commission's order of February 3, 1975, revising the fuel clause, states that the clause "is intended to recover all increases in fuel costs which are beyond applicant's control on a timely basis". The commission's order of December 22, 1975, states that the hearing referee would have allowed collection of the $26 million over a 12-month period. The order states that Edison does not assert that it is entitled to recover the $26 million because of the accounting treatment provided for in the order of July 29, 1974, and that its request should not be denied on the ground that the proceedings do not constitute rate proceedings.
The commission decided against Edison on the ground that Edison is in effect seeking a retroactive revision of the fuel clause:
"So understood, it is evident that applicant in effect requests the commission to retroactively revise the fuel clause which was in existence prior to February 3, 1975. The purpose of that revision would be to permit applicant to recover dollar for dollar its actual fuel expenses, even though the clause as originally adopted did not permit complete and total recovery in a period of steady rising fuel costs.
*532 "The commission is persuaded that granting applicant's request would be inappropriate and unfair. The commission is not empowered to establish rates for a past period, but instead is only allowed to engage in prospective ratemaking. At the least, applicant's request comes especially close to violating that principle. The previous fuel clause was adopted after thorough and full hearing in a rate case; if it was an improper or insufficient clause, then applicant should have so argued at that time. Further, applicant's proposal in this proceeding, if adopted, would mean that applicant's present customers would be charged for fuel expenses incurred on behalf of customers during a previous period; clearly, the respective sets of customers may and do consist of different people and entities. Consequently, the commission cannot permit the temporary surcharge requested by applicant to recover the $26,349,806 of undercollection under its previous fuel cost adjustment clause.
"The administrative law judge noted `* * * the underlying commission policy * * * that customers would pay for increased fuel expenses such as those represented by the $26,349,806 involved in these proceedings' as the basis for his recommendation. The administrative law judge's interpretation of commission policy is accurate with regard to the fuel cost adjustment clause of Case No. U-4570, wherein the billing lag was eliminated. However, the policy implicit in applicant's previous fuel clause was not the same as the policy implicit in the clause adopted in Case No. U-4570. The previous clause embodied a policy which contemplated either undercollection or overcollection, depending upon whether the cost of fuel increased or decreased from the basing point. Since fuel costs in fact increased during that period, it is consistent with that policy that applicant bear the burden of the undercollection."
When the commission, in its order of February 3, 1975, stated that Edison shall file an application for a determination in a separate proceeding "as to disposition of the accumulated fuel cost deferral up to the effective date of this order", it was *533 speaking of expenses (excess fuel costs of $26 million) that had been incurred within just a few months of the date of the order. Edison could not have been expected to have filed an application more immediately than within a few months after the incurrence of the expense.
The rule against retroactive ratemaking does not require that an application for an increase in rates be filed before the incurrence of the expense which is said to justify the increased rate. The rule against retroactive ratemaking precludes the commission from increasing or reducing rates retroactively, but manifestly does not preclude it from acting on the basis of facts that occurred before the order was entered.
Edison is not seeking a retroactive change in the fuel clause, but simply recovery of the $26 million two-month lag which the fuel clause carried forward from month to month until the commission's catch-up order of February 3, 1975, and its order of December 22, 1975, requiring the write-off of that amount.
If Edison had complained about the form of the fuel clause at the time it was first approved by the commission, the commission would no doubt have advanced administrative and other objections to a current collection of the full amount of the excess cost to justify the form of the clause.
There is no reason to suppose that Edison waived the right someday to seek and collect the $26 million merely because it was satisfied at the time the fuel clause was first approved with a two-month lag and to carry forward what grew to $26 million from month to month.
There is nothing in any of the orders which indicates that the commission decided that Edison was never to collect the $26 million until the order *534 of December 22, 1975, providing that it be written off,[9] at which point Edison acted expeditiously by filing an action in the Ingham Circuit Court less than a month later, on January 19, 1976.
What Edison sought in 1975 and what it was entitled to was some sort of order recognizing its right ultimately to recover, and providing a means by which it would recover, the $26 million two-month lag carried forward for which no provision for collection had as yet been made.
Although the fuel clause as originally established may have provided for an indefinite carrying forward of this amount, it does not follow that Edison could not seek at any time to have the commission provide for the current collection of the amount of the two-month lag or that it had waived the right to seek the current collection of, and ultimately to collect, the $26 million actually expended. It is apparent from the several modifications in less than two years of this fuel clause that fuel clauses are subject to change.
It was beyond the power of the commission to require Edison to write off $26 million of expenses actually incurred.
The Court of Appeals judgment should be reversed.
KAVANAGH and COLEMAN, JJ., concurred with LEVIN, J.
LEVIN, J.
The opinion for affirmance states that "a fuel clause that recovers all past costs [is] a *535 `cost of service' tariff" and a fuel clause that "uses past costs to estimate current ones [is] a `fixed rate tariff'";[1] that this fuel adjustment clause, approved by the commission in February, 1974, "was not designed to recover past costs";[2] that the statute does not "create a right of the utility to have a particular kind of fuel adjustment clause": "Edison is entitled to whatever" the commission-approved fuel adjustment clause provides.[3] While "it is true that in this case Edison's total [fuel adjustment clause] charges were less than its excess fuel costs", "that is simply one of the risks that any utility operating under our regulatory system takes".[4] In that "analysis", "[t]here was no gap in Edison's billing of fuel costs recoverable under" the fuel adjustment clause.[5]
When this fuel adjustment clause was authorized, there was no prospect of fuel costs being "lower than predicted".[6] This was, as the commission observed, "a period of steady rising fuel costs".[7]
Because fuel costs were moving in the commission's language, "escalating"[8] in one direction: up, the two-month lag meant that collection of the excess fuel costs for that period was at least deferred or, as the commission would now have this Court read the fuel adjustment clause, would never occur at all.
*536 While in another context the concept of "estimating" or approximating might be regarded as a fair, albeit a rough accommodation, where that method can only, in light of market conditions, work against the utility, it cannot properly be characterized or justified as even-handed and just "one of the risks that any utility operating under our regulatory system takes".
If this fuel adjustment clause "was not designed to recover past costs" and if Edison could only recover for the $26 million amount of the two-month lag if and when the cost of fuel returned to December 1973 levels, then it was "designed" to assure that Edison would never recover the excess fuel cost for the two-month lag.
While the commission was indeed authorized to design the fuel adjustment clause, Edison need not acquiesce in "whatever" the commission approved. It was not until the entry of the December 22, 1975, order requiring a write-off of the $26 million amount of the two-month lag that Edison knew that the commission (which had given other indications)[9] ignoring both the reason for providing for adjustment in rates to recover excess fuel costs and the terminological anachronism would characterize the fuel adjustment clause as a fixed rate and require a write-off of the $26 million amount of the two-month lag.
In sum, the commission could not, consistently with the purpose of fuel adjustment clauses, design a clause which, as the commission would now have us read it, was bound to fail to recover excess fuel costs, and Edison acted timely when it sought judicial relief as soon as the commission declared *537 that the fuel adjustment clause did not contemplate that Edison could ultimately bill customers for the amount of the two-month lag.
RILEY, J., took no part in the decision of this case.
NOTES
[1] 403 Mich 853 (1978).
[2] The FCAC could not affect February 1974 billings because the second preceding month would have been December 1973, the base month for the FCAC, as to which, by definition, there could be no excess fuel costs.
[3] Michigan Bell Telephone Co v Public Service Comm, 315 Mich 533; 24 NW2d 200 (1946).
[4] As noted in the opinion for reversal, we remanded to the MPSC for the taking of evidence and the making of findings regarding the fuel adjustment clauses used between February and May, 1975.
On remand, the MPSC found that the modifications in FCAC adopted in the February 1975 order were put into effect in billings for February 1975, except that the lag-adjustment feature was not used immediately. For customers being billed on the two-month lag system, the lag-adjustment procedure went into effect in April. For those being billed on a one-month lag system, the lag adjustment was first applied in March 1975. Thus, even using Edison's theory regarding the operation of the FCAC, the failure to apply the lag adjustment in February and March means that the 1974 FCAC was still effectively in operation in December 1974 and January 1975, resulting in the recovery of Edison's excess fuel costs for those months.
[5] Maine Public Service Co v Federal Energy Regulatory Comm, 622 F2d 23, 25 (CA 1, 1980); Boston Edison Co v Federal Energy Regulatory Comm, 611 F2d 8, 9 (CA 1, 1979); Public Service Co of New Hampshire v Federal Energy Regulatory Comm, 195 US App DC 130, 134; 600 F2d 944, 948 (1979).
[6] Edison relies upon Maine Public Service Co v Federal Power Comm, 579 F2d 659 (CA 1, 1978), which it claims "seriously challenges" the cases relied upon by appellees. In that case, the First Circuit held that the Federal Power Commission had erred in regarding itself as automatically precluded by the "filed rate doctrine" from approving a surcharge because the First Circuit found the "filed rate doctrine" was not applicable. Under the "filed rate doctrine" a public utility "can claim no rate as a legal right that is other than the filed rate, whether fixed or merely accepted by the Commission." Montana-Dakota Utilities Co v Northwestern Public Service Co, 341 US 246, 251; 71 S Ct 692; 95 L Ed 912 (1951).
The Court remanded the case to the commission for reconsideration, stating that the commission was not precluded from rejecting the surcharge, but that it was error for the commission to have rejected the surcharge on the grounds that its hands were tied by the "filed rate doctrine". Obviously, there is no problem with the "filed rate doctrine" in the instant case. The narrow ground upon which the Maine case turns is sufficient in itself to distinguish it from the case at bar.
Yet, Edison seizes upon other language in the opinion which it claims, inter alia, requires the conclusion that surcharges do not necessarily constitute retroactive ratemaking and that courts reviewing surcharges must "inquire into the equities", considering the reasonable expectations of customers and the legitimate needs of the utility.
The language upon which Edison relies has been seriously undermined by later cases. On remand, the commission concluded that the FCAC was a fixed-rate tariff and, therefore, the surcharge was disallowed. The decision was appealed to the First Circuit, which denied the petition for review. Maine Public Service Co v Federal Energy Regulatory Comm, 622 F2d 23 (CA 1, 1980).
In a later First Circuit case, Boston Edison Co v Federal Energy Regulatory Comm, supra, the Court also disallowed a surcharge, holding that a fixed-rate tariff was involved. Significantly, the author of the original Maine Public Service decision, speaking for himself, stated that Maine Public Service must be read in light of the presentation the commission made at the time. The commission chose to rest mainly on the "filed rate doctrine", and the Maine Public Service Court did not feel that the commission had analyzed sufficiently the nature of the superseded fuel clause which determined the question of retroactive ratemaking.
Thus, it is clear that the First Circuit has held that it will disallow a surcharge where a fixed-rate tariff is involved. This is similar to the other federal decisions considered. In addition, in Public Service Co of New Hampshire v Federal Energy Regulatory Comm, supra, the District of Columbia Circuit thoroughly analyzed the language in Maine Public Service relied upon by Edison and was extremely critical of it.
[7] Of course, the utility faces a corresponding "risk" of overcollection should costs fall. Cf. Michigan Bell Telephone Co v Public Service Comm, supra.
[8] See, e.g., Attorney General v Public Service Comm, 63 Mich App 69; 234 NW2d 407 (1975).
[9] See, e.g., General Telephone Co of Michigan v Public Service Comm, 78 Mich App 528; 260 NW2d 874 (1977).
[10] See generally General Telephone Co of Michigan v Public Service Comm, 341 Mich 620, 632; 67 NW2d 882 (1954):
"This Court made it very clear in Michigan Bell Telephone Co v Public Service Comm, 315 Mich 533 (66 PUR NS 287), that the commission cannot establish a retroactive rate thereby correcting injustice caused by delay in establishing rates for the past. When failure to provide adequate rates in the past cannot be remedied by retroactive orders, it follows that every reasonable effort should be made by the commission to eliminate unnecessary delay and to pass judgment on facts that will not only reflect upon the present but a reasonable period in the future."
[11] We also disagree with Edison's claim that the deferred fuel cost accounting procedure approved on July 29, 1974, implies that excess fuel costs incurred but not yet "reflected" in customers' bills were to be recovered in later months.
First, the accounting change was authorized almost six months after the superseded FCAC was adopted. Thus, it cannot serve as an indication of Edison's or the commission's intent regarding the nature of the superseded FCAC at the time it was instituted. One of the acknowledged purposes of the accounting change was to enable Edison to have a more favorable financial position to assist in sales of its securities. This, we suggest, is the primary implication of Edison's request for and the commission's approval of the accounting change.
Edison also argues that use of the deferred accounting method would have violated accounting principles and misled investors unless there was a reasonable assurance of recovery; hence, the commission would not have approved the accounting change unless it believed that the superseded FCAC was a recovery mechanism. This contention fails for two reasons. First, in the order approving the accounting change, the commission specifically ordered the change to be properly disclosed in Edison's financial statements. Second, in its original application for the deferred accounting method, realizing that a balance might be left in such an account if the FCAC was changed to make it more current, Edison included a paragraph which would have allowed charging customers for this balance. This paragraph was deleted by stipulation and replaced with a paragraph in which Edison agreed that the new accounting method would not result in higher rates for its customers. Thus, neither Edison nor its investors was misled to believe that the accounting change assured recovery of any balance created by its use.
Finally, we note that other courts have likewise rejected the argument that implementation of deferred fuel accounting implies recovery of excess fuel costs in later months. Boston Edison Co v Federal Energy Regulatory Comm, supra, p 10; Public Service Co of New Hampshire v Federal Energy Regulatory Comm, supra, pp 136-137; State of North Carolina ex rel Utilities Comm v Attorney General, 291 NC 451, 472-474; 232 SE2d 184, 197 (1977).
[12] Former MCL 460.6a; MSA 22.13(6a).
[1] For a number of years fuel cost adjustment clauses had been included in rates charged by Edison to industrial and commercial customers. The statute (MCL 460.6a; MSA 22.13[6a]) was amended in 1972, and thereafter such clauses could be provided for domestic service.
The Legislature has recently amended this statute again to preclude fuel adjustment clauses. 1982 PA 304. In addition, the adoption of Proposals D and H at the 1982 general election will affect utility practices in this area.
[2] On September 20, 1973, Detroit Edison applied to the commission for authority to include a fuel adjustment clause in its domestic (residential) rate schedules. (Case No. U-4426.) On February 4, 1974, the commission granted Edison's request to add a fuel adjustment clause to the rates for its domestic customers. The billing rule approved by the commission allowed Edison to increase or decrease the charges per kilowatt-hour by the amount that costs for fuel had increased or decreased from the cost in a base month (December 1973). The approved billing rule said that "[t]he adjustment shall apply to the second billing month following the calendar month in which the fuel is burned."
Thus, beginning in February 1974, Edison customers' electric bills consisted of two components: a base rate, and a fuel cost adjustment based on the fuel costs incurred two months before. For example, the September 1974 fuel costs (adjusted by a "line loss factor") exceeded the December 1973 base costs by $0.53517 per kilowatt-hour adjustment.
The fuel adjustment clause for certain commercial and industrial customers operated somewhat differently. Fuel costs were billed to those customers in the next billing month following the month in which the fuel was burned.
[3] Edison's accounting procedures called for fuel costs to be recorded as expenses in the month when the fuel was used. Under the fuel adjustment clause approved in February 1974 billings to customers did not immediately reflect cost changes, creating a lag in recovery of fuel costs, which were rapidly increasing during this period. Citing this billing lag, on June 18, 1974, Edison petitioned the commission for approval of a change in the accounting procedure. (Case No. F-647.)
On July 29, 1974, the commission approved the request for the accounting change. The commission authorized Edison to record fuel costs above the base as an asset on the company's balance sheet. The accounting procedures treated these "deferred fuel costs" as being recovered when customers' bills were adjusted on the basis of these excess fuel costs two months later. The change in accounting procedures was made retroactive to January 1974.
[4] The February 3, 1975 order was issued in connection with a pending Edison rate increase application. (Case No. U-4570.) The order revised Edison's fuel cost billing rule. The order added a "lag adjustment" provision. Under the new rule, bills for a particular month would be adjusted on the basis of the second previous month's excess fuel cost plus the difference between the second and the fourth preceding months' excess fuel cost. Assuming a steady increase in fuel prices over the relevant period, this formula would lead current fuel cost adjustment billings to quite closely reflect actual current fuel prices.
The new schedule read much the same as the first; i.e., "[t]he fuel adjustment shall be applied to the second billing month following the calendar month in which the fuel is burned", but to correct for the two-month lag, there was to be an increase or decrease "by the difference between the `two-month lag' adjustment factor applied in the second immediately preceding billing month and the `two-month lag' adjustment factor to be applied for the immediate billing month."
[5] The amount actually collected from customers was only $23,514,278.
[6] This Court initially denied leave to appeal. 403 Mich 823 (1978). However, Edison's motion for reconsideration was granted and on reconsideration leave to appeal was granted. 403 Mich 853 (1978). On October 27, 1978, this Court stayed the refund of the money collected.
After the cause was argued, we remanded on February 1, 1980, to the commission to take evidence and make specific findings of fact regarding the method of calculation and figures used by Edison in determining billings for the months of February, March, April, and May of 1975, and particularly as to which fuel adjustment clause was used during those months. The findings after remand were filed by the commission on July 30, 1982.
[7] The Detroit Edison Co v Public Service Comm, 82 Mich App 59, 74-75; 266 NW2d 665 (1978).
[8] "The pertinent facts necessary to determine the central question raised by this application are clear and undisputed. Under the fuel cost adjustment clause existing prior to February 3, 1975, there was a billing lag. The result of that lag was that changes in applicant's fuel costs were not recognized in customers' bills until 30 to 60 days after they were incurred. Thus, if fuel costs steadily increased, applicant would spend more for fuel than it collected from its customers through the fuel clause. Conversely, if fuel costs steadily declined, applicant would collect more from its customers through the fuel clause than it actually expended for fuel.
"In Case No. U-4570, the commission revised applicant's fuel clause so that fuel expenditures and revenues from the fuel clause would occur at about the same points in time. Since fuel costs had steadily increased during the preceding period, applicant had not collected through the previous rates, including the fuel clause, all of its actual expenditures for fuel.
"The Order in Case No. F-647 had nothing to do with this undercollection of $26,349,806. It was inherent in applicant's previous fuel clause that the full amount of fuel expenses would not be collected if fuel costs rose above the base fuel cost without at some subsequent time falling below the base cost. The only effect of Case No. F-647 was to display the undercollection separately in Account 174." MPSC Order, December 22, 1975 (Case No. U-4758).
[9] "Finally, it is necessary that the proper disposition of the amounts accumulated in Account 174 be determined. The commission is aware of the potential for negative consequences for applicant if those accumulations are written off in too short a period. Consequently, the commission finds that the $26,349,806 should be written off against net income over a period of 10 years." MPSC Order, December 22, 1975 (Case No. U-4758).
[1] Ante, p 517.
[2] Ante, p 516.
[3] Ante, p 524.
[4] Ante, p 522.
[5] Ante, p 517.
[6] Ante, p 523.
[7] Order of December 22, 1975 (Case No. U-4758); see seventh paragraph of the opinion for reversal, ante, p 528, for quoted language in context.
[8] Order of February 3, 1975 (Case No. U-4570); see third paragraph of the opinion for reversal ante, p 526, for quoted word in context.
[9] Commission's order of July 29, 1974 (Case No. F-647), speaking of credits subject to "later billing" and "deferred payment"; and the order of February 3, 1975, fn 8 supra, speaking of a "billing lag" and "deferred fuel costs" and "accumulated fuel cost deferral". | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614497/ | 939 So.2d 123 (2006)
MICHAEL GRIMSLEY, Appellant,
v.
STATE OF FLORIDA, Appellee.
Case No. 2D05-3705.
District Court of Appeal of Florida, Second District.
Opinion filed September 1, 2006.
James Marion Moorman, Public Defender, and Lanitra Sanchez-Moore, Assistant Public Defender, Bartow, for Appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, and Richard M. Fishkin, Assistant Attorney General, Tampa, for Appellee.
STRINGER, Judge.
Michael Grimsley raises four issues on review of his judgment and sentence for aggravated battery. We affirm Grimsley's judgment and sentence but write to discuss one of the issues raised on appeal and an issue that was not raised on appeal.
Grimsley was charged with aggravated battery with great bodily harm or permanent disability or permanent disfigurement. The State's theory at trial was that Grimsley attacked the victim, causing great bodily harm to him by inflicting a sinus bone fracture, an orbital fracture, and a hematoma. Grimsley's defense at trial was self-defense.
During the jury charge conference, Grimsley requested instructions on both justifiable use of deadly force and justifiable use of nondeadly force. The court refused to give both instructions, and Grimsley asked for some time to decide which instruction to choose. After a recess, Grimsley chose the instruction on justifiable use of nondeadly force without further objection. On appeal, Grimsley argues that the trial court abused its discretion in denying his request for both instructions.
If the evidence does not establish that the force used by the defendant was deadly or nondeadly as a matter of law, then the jury should decide the question and the defendant is entitled to instructions on both justifiable use of deadly force and justifiable use of nondeadly force. Caruthers v. State, 721 So. 2d 371, 371-72 (Fla. 2d DCA 1998); Mathews v. State, 799 So. 2d 265, 266 (Fla. 1st DCA 2001); Williams v. State, 727 So. 2d 1062, 1062 (Fla. 4th DCA 1999). The evidence in this case does not establish that the force used by Grimsley was deadly or nondeadly as a matter of law. Accordingly, Grimsley was entitled to both instructions.
However, we conclude that Grimsley did not preserve this issue for review because counsel abandoned his request for both instructions by choosing the instruction on justifiable use of nondeadly force without further objection. Thus, Grimsley is not entitled to reversal on this basis.
There is an error in the jury instructions that would require a new trial regardless of Grimsley's failure to object below; however, this error was not raised on appeal. Our review of the record revealed that the trial court erroneously gave the standard jury instruction regarding the forcible felony exception to self-defense. See York v. State, 932 So. 2d 413, 415-16 (Fla. 2d DCA 2006); Houston v. State, 919 So. 2d 489, 490 (Fla. 2d DCA 2005); Zuniga v. State, 869 So. 2d 1239, 1240 (Fla. 2d DCA 2004). Although this court has determined that the giving of this instruction constitutes fundamental error under similar circumstances, see id., we are precluded from reviewing the issue because it was not raised on appeal. Our affirmance is therefore without prejudice to any right Grimsely might have to file a motion for appropriate postconviction relief.
Affirmed.
CANADY and LaROSE, JJ., Concur.
NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1646488/ | 9 So.3d 631 (2009)
CARDONA
v.
STATE.
No. 4D07-3946.
District Court of Appeal of Florida, Fourth District.
May 13, 2009.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614527/ | 939 So.2d 338 (2006)
JOSEPH HARRIS, Appellant,
v.
STATE OF FLORIDA, Appellee.
No. 4D05-632.
District Court of Appeal of Florida, Fourth District.
October 18, 2006.
James O. Walker, III, Fort Lauderdale, for appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, and Melynda L. Melear, Assistant Attorney General, West Palm Beach, for appellee.
ON MOTION FOR REHEARING
STONE, J.
We deny Harris' motion for rehearing, but withdraw our opinion of March 29, 2006, and substitute the following opinion:
Harris was convicted of possession of cocaine with intent to deliver/sell. He contends that the trial court erred in denying his motion for disclosure of the identity of a confidential informant. We affirm.
We conclude that the failure to disclose the informant's identity in this case did not infringe on the right to disclose recognized in Roviaro v. United States, 353 U.S. 53 (1957), as there was no showing of a colorable entrapment defense and mere speculation that the informant's testimony would be useful.
Although Harris argues that an exchange of drugs and money took place between the informant and a perpetrator, the record reflects that the informant's role at the scene was insignificant. DEA agent Kim Wright testified that she was acting undercover with an informant in conjunction with the Fort Lauderdale police. She drove with the informant to Harris' residence seeking to purchase crack cocaine. She was in the driver's seat, and the informant was in the passenger seat. There was a device in the car that allowed other officers to listen.
When Wright and the informant pulled up, Harris approached the informant's side of the car. The informant told Harris that Wright wanted to buy crack cocaine. Harris went inside the house and returned with the drugs. He approached on the passenger side and handed the crack cocaine to the informant, who immediately passed it to Wright. The tape recording of the incident was published to the jury.
After the state rested, defense counsel advised the court that it wanted to call the confidential informant but did not have him under subpoena because, pursuant to the prior order denying the motion, the identity of the informant was not disclosed. Harris did not testify, but contends that the unknown informant would support defense counsel's argument that Harris did not sell cocaine to either Wright or the informant and, also, that any criminal act originated with the police and the informant.
A trial court's discovery orders are reviewed for an abuse of discretion. Gold, Vann & White, P.A. v. DeBerry By and Through DeBerry, 639 So. 2d 47, 56 (Fla. 4th DCA 1994).
Florida law recognizes a limited privilege for the state to withhold the identity of a confidential informant. Florida Rule of Criminal Procedure 3.220(g)(2), Informants, states that "Disclosure of a confidential informant shall not be required unless the confidential informant is to be produced at a hearing or trial or a failure to disclose the informant's identity will infringe the constitutional rights of the defendant." Fla. R. Crim. P. 3.220(g)(2).
In Roviaro, the Supreme Court recognized the government's privilege to withhold from disclosure the identity of persons who furnish information to law enforcement officers. However, the government's privilege gives way to a defendant's rights where the disclosure of the informant's identity would be relevant and helpful to the defense and where the disclosure is essential to a fair determination of the case. The Supreme Court concluded:
We believe that no fixed rule with respect to disclosure is justifiable. The problem is one that calls for balancing the public interest in protecting the flow of information against the individual's right to prepare his defense. Whether a proper balance renders nondisclosure erroneous must depend on the particular circumstances of each case, taking into consideration the crime charged, the possible defenses, the possible significance of the informer's testimony, and other relevant factors.
353 U.S. at 62.
In State v. Zamora, 534 So. 2d 864, 867-68 (Fla. 3d DCA 1988), the court explained the underlying rationale for the exception to the state's privilege:
notwithstanding the important public policy considerations which support the privilege of nondisclosure, these considerations cannot prevail where such nondisclosure either runs a substantial risk of convicting an innocent person or substantially threatens the accused's due process right to a fair trial. Moreover, it is clear that `the burden is upon the defendant claiming [the aforesaid] exception to the rule [of nondisclosure] to show why an exception should be invoked.'
Factors the trial court should consider in determining whether the identity of the informant should be disclosed "include, but are not limited to, whether the prosecutor must refer to the informer in the presentation of the case, whether the informer was an active participant in the offense charged or whether he simply supplies a lead, whether the accused admits or does not deny guilt, and whether there is independent evidence of the accused's guilt." Rowell v. State, 382 So. 2d 886, 887 (Fla. 1st DCA 1980)(citing Treverrow v. State, 194 So. 2d 250 (Fla. 1967)).
"Absent allegations of a specific defense sought to be established through the confidential informant, the privilege of nondisclosure must not be invaded. A bare allegation that the defendant cannot prepare his case without disclosure is insufficient. Mere speculation that the confidential informant's testimony would be useful is insufficient." State v. Mashke, 577 So. 2d 610, 612 (Fla. 2d DCA 1991)(citations omitted). "The defendant must make a preliminary showing of the colorability of the defense prior to disclosure." State v. Hernandez, 546 So. 2d 761, 762 (Fla. 2d DCA 1989)(citing State v. Acosta, 439 So. 2d 1024 (Fla. 3d DCA 1983)).
In Roviaro, the drug transaction was exclusively between the defendant and the informant, although one officer was hiding in the informant's car trunk and others were following. There, the court stated,
The materiality of John Doe's possible testimony must be determined by reference to the offense charged . . . and the evidence relating to that count. The charge is in the language of the statute. It does not charge mere possession; it charges that petitioner did `fraudulently and knowingly receive, conceal, buy and facilitate the transportation and concealment after importation of . . . heroin, knowing the same to be imported into the United States contrary to law. . . .' While John Doe is not expressly mentioned, this charge, when viewed in connection with the evidence introduced at the trial, is so closely related to John Doe as to make his identity and testimony highly material.
***
The circumstances of this case demonstrate that John Doe's possible testimony was highly relevant and might have been helpful to the defense. So far as petitioner knew, he and John Doe were alone and unobserved during the crucial occurrence for which he was indicted. Unless petitioner waived his constitutional right not to take the stand in his own defense, John Doe was his one material witness. Petitioner's opportunity to cross-examine Police Officer Bryson and Federal Narcotics Agent Durham was hardly a substitute for an opportunity to examine the man who had been nearest to him and took part in the transaction. . . . This is a case where the Government's informer was the sole participant, other than the accused, in the transaction charged. The informer was the only witness in a position to amplify or contradict the testimony of government witnesses.
Roviaro, 353 U.S. at 62-64.
In Styles v. State, 780 So. 2d 1040, 1040 (Fla. 4th DCA 2001), a detective drove an informant to an apartment building, gave him money, and told him to make a drug buy at a certain apartment. After the informant completed the transaction, he directly returned to the car where the detective had been observing the transaction. Id. The detective then sent the arrest team to arrest the defendant. Id.
In reversing the conviction, we found that, as in Roviaro, disclosure was "deemed essential in order to guarantee the defendant his due process right to a fair trial." Id. at 1041 (quoting Zamora, 534 So. 2d at 869). We recognized that "`disclosure of a confidential informant is absolutely required where the defendant is charged with selling or delivering illegal drugs to the subject informant.'" Id.
We deem Roviaro and Styles distinguishable. In State v. Carnegie, 472 So. 2d 1329, 1329 (Fla. 2d DCA 1985), a detective, together with an informant, met with the appellant to procure contraband drugs. The court stated, "[t]he conclusory contention set forth in Carnegie's motion that non-disclosure of the informant's identity `would directly affect the Defendant's opportunity to establish possible defenses,' is wholly inadequate in overcoming preservation of the state's privilege." Id. at 1330 (citation omitted). The court continued, "Here, unlike that which occurred in Roviaro, at no pertinent time was Carnegie alone with the informant; on each occasion the detective was present. Thus, it cannot be said that the informant was the sole material witness to the events without whose testimony Carnegie would be denied the right to examine his accuser. Carnegie's unembellished contentions are insufficient to satisfy his burden." Id.
In essence, Harris made an insufficient preliminary showing of the colorability of his defense, or that the testimony of the informant would vary materially from that of the police. In Roviaro, the appellant and the informant were alone during the transaction; here, the informant was simply a conduit. Styles also involved a situation where the informant and the accused were the only participants to the transaction, necessitating disclosure. Here, the sale was directly to the law enforcement officer. Additionally, there is simply speculation by defense counsel that the informant's testimony could possibly support the attorney's contention that Harris was not the individual involved in the transaction. Further, other than noting that the incident was initiated by the police, the defense of entrapment is not mentioned or supported, nor is there more than mere speculation that the informant would add anything to the known facts. To the contrary, here, there is no evidence of an asserted defense.
We also note that Harris asserted in an affidavit in support of the motion to disclose that he thought he was at work when the transaction occurred, but he does not argue that there were any witnesses he could call in support of that claim, nor was alibi raised as a defense. We also note that neither party in this case sought an in camera review, nor does either party raise the failure to hold an in camera as an issue on appeal.
As to all other arguments we also find no abuse of discretion. Therefore, the judgment and sentence are affirmed.
MAY, J., concurs.
FARMER, J., dissents with opinion.
FARMER, J., dissenting.
I must admit that I failed to grasp defendant's argument when I agreed to affirm his conviction without any opinion. Now that I understand it, I agree that it has merit. I would grant rehearing and reverse for a new trial.
The majority says that Roviaro[1] and Styles are distinguishable but their attempt to do so actually shows that they are not materially different in any meaningful way. As Judge Gross explained in Styles:
"Factually, this case is similar to Roviaro. In both cases, police officers watched an informant purchase drugs from a defendant, the police recovered the drugs soon after the transaction, and the police identified the defendant as the person who delivered the drugs. The Supreme Court in Roviaro required the government to disclose the informant's identity, observing that since the informant was the `sole participant, other than the accused, in the transaction charged,' the informant `was the only witness in a position to amplify or contradict the testimony of government witnesses.' Under such circumstances, the Supreme Court ruled that
[t]he desirability of calling [the informant] as a witness, or at least interviewing him in preparation for trial, was a matter for the accused rather than the Government to decide.
Because the crime in this case involved the delivery of cocaine directly to the informant, this case falls within the exception to the limited informant privilege. . . . If one goal of the privilege is to preserve the anonymity of those helping the police, that aspect is not implicated here. Unlike a tipster who provides information to the police to establish probable cause for a search or arrest, the informant in this case disclosed his identity by coming face to face with the defendant to purchase drugs." [c.o.]
Styles v. State, 780 So.2d 1040, 1041 (Fla. 4th DCA 2001).
As in Roviaro and Styles, the informant here participated in the crime itself, rather than merely furnishing a tip to establish probable cause for a warrant. The informant handled the drug buy, did the speaking to the person selling the drugs, received the drugs directly from the seller, and in turn delivered the substance to the police. Defendant's contention here is that police have the wrong man. The informant is thus in exactly the same situation as the informants in Roviaro and Styles. Because the informant dealt directly with the person selling the drugs, if it really was defendant, the cat is already partially out of the bag.
Roviaro makes clear that it is not relevant to disclosure whether the informant will actually be called by defendant to testify at trial:
"Petitioner's opportunity to cross-examine Police Officer Bryson and Federal Narcotics Agent Durham was hardly a substitute for an opportunity to examine the man who had been nearest to him and took part in the transaction. [The informant] had helped to set up the criminal occurrence and had played a prominent part in it. His testimony might have disclosed an entrapment. He might have thrown doubt upon petitioner's identity or on the identity of the package. He was the only witness who might have testified to petitioner's possible lack of knowledge of the contents of the package that he `transported' from the tree to [the informant's] car. The desirability of calling [the informant] as a witness, or at least interviewing him in preparation for trial, was a matter for the accused rather than the Government to decide."
353 U.S. at 64. As Roviaro further emphasized:
"Finally, the Government's use against petitioner of his conversation with [informant] . . . emphasizes the unfairness of the nondisclosure in this case. The only person, other than petitioner himself, who could controvert, explain or amplify [the] report of this important conversation was [the informant]. Contradiction or amplification might have borne upon petitioner's knowledge of the contents of the package or might have tended to show an entrapment."
Id. All of these considerations from Roviaro apply in this case.
It is said that defendant made an "insufficient preliminary showing of the colorability of his defense," that the informant was merely a conduit. The jury might well have so concluded if defendant presented a full defense after taking a discovery deposition of the informant and was able to make full use of anything gleaned from it. But Roviaro merely requires that the information might have affected defendant's presentation of evidence. 353 So.2d at 64 ("His testimony might [e.s.] have disclosed an entrapment. He might [e.s.] have thrown doubt upon petitioner's identity or on the identity of the package. He was the only witness who might [e.s.] have testified to petitioner's possible lack of knowledge of the contents of the package that he `transported' from the tree to [the informant's] car."). It does not require a defendant seeking the identity of an informant to show that it probably will affect the evidence at trial. 353 So.2d at 64 ("The desirability of calling [the informant] as a witness, or at least interviewing him in preparation for trial, was a matter for the accused rather than the Government to decide.").
Neither can the propriety of disclosing the informant turn on whether defendant has already presented "evidence of an asserted defense." After all, the error here is in failing to give the name of the informant to exhaust that source of "evidence of an asserted defense." For that reason also, the failure to ask for an in camera inspection is illogical and unfair.
I would reverse for disclosure of the informant and a new trial.
NOTES
[1] Roviaro v. United States, 353 U.S. 53 (1957). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614596/ | 939 So. 2d 1175 (2006)
Antwuan SNELL, Appellant,
v.
STATE of Florida, Appellee.
No. 4D04-3602.
District Court of Appeal of Florida, Fourth District.
October 25, 2006.
*1177 Carey Haughwout, Public Defender, and John M. Conway, Assistant Public Defender, West Palm Beach, for appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, and Jeanine M. Germanowicz, Assistant Attorney General, West Palm Beach, for appellee.
WARNER, J.
Antwuan Snell appeals his multiple convictions, including ones for trafficking in cocaine, aggravated fleeing and eluding, and two counts of leaving the scene of an accident with injuries. Snell claims that the trial court erred in admitting his statement connecting him to the cocaine, because *1178 the state had not established the corpus delicti before its admission. He also claims that numerous evidentiary errors cumulatively denied him a fair trial. We conclude that the court did not err in admitting his statement, and the alleged evidentiary errors were either not error, not preserved, or were harmless. We affirm.
Two Fort Lauderdale police officers noticed a vehicle with dark tinted windows. They activated their lights to stop the vehicle for the equipment violation, but the vehicle took off. Rather than engage in a high speed chase, they turned off their lights but observed the vehicle continue at a high rate of speed and ultimately crash into another vehicle. The crash was of such force as to throw both occupants of the other vehicle out of the car and onto the pavement.
The officers pulled up and saw defendant Snell, whom they identified as the driver, crawling over his unconscious passenger out the passenger side window. He took off running, but one officer caught him almost immediately, took him to the ground, and handcuffed him. EMT personnel arrived to assist the injured victims. The other officer checked Snell's passenger. When he did, he observed a plastic bag containing cocaine on the front seat in the middle of the car. Officers searched Snell and found a wad of small bills totaling $2010 in his pocket.
Snell complained of foot pain, and the officers transported him to the same hospital where the injured victims from the other vehicle were taken. Both during the trip to the hospital and at the hospital, Snell was talkative. In fact, at the hospital he provoked a confrontation with the family of one of the victims with some of his comments and his laughing. During this time, he continued to talk and told one of the officers, using expletives, that they could keep his cocaine but he wanted his money back.
The state ultimately charged Snell with trafficking in cocaine, as the amount of cocaine seized was 29.2 grams, as well as aggravated fleeing and eluding, two counts of leaving the scene of an accident with injuries, leaving the scene of an accident with property damage, misdemeanor reckless driving, and having no valid driver's license. The jury convicted him of all charges. The court sentenced Snell to thirty years in prison on the trafficking count, fifteen years on the aggravated fleeing and eluding, five years on the counts for leaving the scene of an accident with injuries, and time served on the remaining counts.
On appeal, Snell contends that the court erred in allowing the state to introduce his admission of ownership of the cocaine before establishing the corpus delicti of the crime. "Ordinarily, proof of the corpus delicti of the crime charged is required before a confession or admission against interest may be received in evidence." Garmon v. State, 772 So. 2d 43, 46 (Fla. 4th DCA 2000). Specifically, the state has to prove:
(1) that a crime of the type charged was committed; and (2) that the crime was committed through the criminal agency of another. In regard to the first partthat a crime was committed each element of the relevant offense must be shown to exist. With respect to the second partthe criminal agency of anotherthe proof need not show the specific identity of the person who committed the crime. That is, it is not necessary to prove that the crime was committed by the defendant.
Franqui v. State, 699 So. 2d 1312, 1317 (Fla.1997) (citations omitted). The primary function of this requirement is to protect the defendant "from being convicted *1179 of a nonexistent crime due to `derangement, mistake or official fabrication.'" Baxter v. State, 586 So. 2d 1196, 1198 (Fla. 2d DCA 1991) (quoting State v. Allen, 335 So. 2d 823, 825 (Fla.1976)).
However, corpus delicti does not necessarily include each element of proof required to establish the defendant's guilt. Baxter, 586 So.2d at 1199. "For example, the defendant's identity is not typically an element of a crime's corpus delicti." Id. As the supreme court stated,
This [corpus delicti] rule obviously does not require the state to prove a defendant's guilt beyond a reasonable doubt before his or her confession may be admitted. Indeed, as this Court has stated before, it is preferable that the occurrence of a crime be established before any evidence is admitted to show the identity of the guilty party, even though it is often difficult to segregate the two. The state has a burden to bring forth `substantial evidence' tending to show the commission of the charged crime. This standard does not require the proof to be uncontradicted or overwhelming, but it must at least show the existence of each element of the crime.
Allen, 335 So.2d at 825 (footnotes omitted). The state's burden in establishing the corpus delicti for an admission is far below its burden for a conviction. See Garmon, 772 So.2d at 46 ("The state is not required to prove the elements of the corpus delicti beyond a reasonable doubt before admission of a defendant's self-incriminatory statements. That burden is only required to convict. The state must, however, present substantial evidence which tends to show that the crime charged was, in fact, committed by someone.") (citations omitted). Circumstantial evidence may be offered to satisfy this burden. See Allen, 335 So.2d at 824 ("[B]efore a confession is admitted the state has the burden of proving by substantial evidence that a crime was committed, and that such proof may be in the form of circumstantial evidence.").
In this case, Snell was charged with violating section 893.135(1)(b)1.a., Florida Statutes (2001), which is the offense of trafficking in cocaine. "The four elements of the offense which must be established beyond a reasonable doubt are as follows: a) that the defendant knowingly purchased or possessed a certain substance, b) the substance was cocaine, c) the quantity was 28 grams or more, and d) the defendant knew the substance was cocaine."[1]Concepcion v. State, 857 So. 2d 299, 300 (Fla. 5th DCA 2003). In order to establish constructive possession of a controlled substance, the state must prove that the defendant "knew of its presence, knew of its illicit nature, and had dominion and control over the contraband." Lewis v. State, 570 So. 2d 346, 348 (Fla. 2d DCA 1990).
The state established sufficient evidence of these elements prior to the admission of the defendant's statement. It proved that officers found a trafficking weight of cocaine in open view in the car Snell had been driving. See State v. Wallace, 734 So. 2d 1126, 1129 (Fla. 3d DCA 1999); Johnson v. State, 569 So. 2d 872, 874 (Fla. 2d DCA 1990). The state introduced additional circumstantial evidence that the crime of trafficking in cocaine had been committed. Snell was the driver of the vehicle who attempted to elude the police at a high rate of speed. After the collision, Snell tried to escape from the scene. *1180 Moreover, Snell had $2010 in a wad of bills in his pocket.
The cases cited by Snell all involve insufficient evidence of the commission of the charged crime to admit the defendant's statement, so these are distinguishable on their facts. McQueen v. State, 304 So. 2d 501 (Fla. 4th DCA 1974) (mere fact that defendant pawned stolen item insufficient to prove corpus delicti where there were no other facts showing defendant's knowledge that item was stolen); State v. Colorado, 890 So. 2d 468 (Fla. 2d DCA 2004) (no independent proof that defendant was driver of vehicle to support admission of inculpatory statement in vehicular homicide prosecution); and Harrison v. State, 483 So. 2d 757 (Fla. 2d DCA 1986) (no independent evidence of defendant's possession of gun to support defendant's admission in prosecution for possession of a firearm by a convicted felon). In none of those cases did the state introduce evidence showing the degree of connection of the defendant to the crime that was present in this case.
The state presented a sufficient evidentiary predicate to establish the corpus delicti. The primary purpose of the rule to prevent admission of a statement of a nonexistent crime or a mistake has been satisfied, and the trial court did not err in admitting the defendant's statement of ownership of the cocaine.
In his second issue on appeal, Snell argues that the trial court erred in admitting evidence that was irrelevant and prejudicial. The standard of review of trial court determinations of relevance is an abuse of discretion standard. Blackmon v. State, 920 So. 2d 1284, 1285 (Fla. 4th DCA 2006); Nardone v. State, 798 So. 2d 870, 874 (Fla. 4th DCA 2001). "All relevant evidence is admissible, except as provided by law." Elysee v. State, 920 So. 2d 1205, 1208 (Fla. 4th DCA 2006). "Relevant evidence is evidence tending to prove or disprove a material fact." § 90.401, Fla. Stat.
First, Snell complains that the officers were able to testify to Snell's interaction with the family of the victim at the hospital when Snell was grinning, laughing, and making comments that antagonized the family. His actual comments were not introduced into evidence, and Snell did not object to some of the statements by witnesses that he was grinning and laughing. The state sought admission of this evidence on the charges of leaving the scene of an accident with injuries. Snell's defense was that when he got out of the vehicle, he was not running away but was himself injured with a broken ankle and essentially could not render aid. See §§ 316.027(1)(a) and 316.062(1), Fla. Stat. His demeanor in the emergency room would tend to disprove his claim of pain and significant injury and thus discredit his claim that he was unable to run away at the scene. The trial court did not abuse its discretion in overruling Snell's objection, because the evidence had some relevance to the material facts in issue.
A second area of evidence, the introduction of which is raised as error on appeal, involves evidence of the injuries to the victims of the accident. The defendant's knowledge of injury is an element of the offense of leaving the scene of the accident involving injury or death. See State v. Dumas, 700 So. 2d 1223 (Fla.1997). Further, in T.B. v. State, 669 So. 2d 1085, 1086 (Fla. 4th DCA 1996), we stated "evidence of victim injury, even where not an element of the offense charged, is admissible if otherwise relevant."
When a paramedic who attended to the victims of the accident testified, the state asked him to explain what kind of treatment he administered. Snell's counsel objected to the testimony on the *1181 ground that the seriousness of the injury is not an element of the crime of leaving the scene of an accident with injuries. The trial court expressed disagreement with the contention that evidence of the seriousness of an injury was not relevant, because a defendant might argue that a victim really suffered no injury. Snell's counsel agreed that the state would be entitled to bring in evidence of what a victim's injuries were and the extent of the injuries. He clarified that he was objecting to continuing testimony about treatment, particularly the treatment in the hospital. The court denied the objection.
The paramedic testified that he put a dressing on a victim's abrasions on his scalp and placed the victim on a board to stabilize his spine in case of injury. Then paramedics transported him to the hospital. Essentially, that was the extent of the testimony following the objection. While evidence of the type of treatment of a victim would not be necessarily relevant to show whether the victim was injured, the evidence, even if irrelevant, was harmless given the other evidence of injury to which the paramedic testified.
Later both victims testified about their injuries. Victim Schepp testified without objection to the extent of his injuries, including that his head was "split open," he was in a wheelchair for eight months, he had pins in his legs, and he could not walk. He showed the jury some of his scars and his right hand which was crushed in the accident. After multiple questions on these injuries, the prosecutor asked if he had any other medical conditions, and to this question Snell's attorney objected "based on my previous argument." The court overruled this objection, and Schepp testified that he had convulsions and was constantly in pain.
Schepp was allowed to testify to the extent of his injuries without objection. When defense counsel objected based upon "previous argument," the question to Schepp did not involve treatment but more evidence of the nature of his injuries. The trial court did not err in overruling this inapposite objection. However, in any event we would consider that this evidence was merely cumulative of other unobjected-to testimony regarding Schepp's injuries and harmless.
A third claimed error in the admission of evidence involves a comment on the right to remain silent by one of the officers who testified that Snell refused to answer questions by the traffic homicide investigator when she came to the hospital to interview him. Reviewing the testimony, we conclude this objection was not preserved. On cross-examination, defense counsel asked the officer whether he remembered the investigator talking to Snell at the hospital, to which the officer responded that he did not believe that Snell talked to her, because he refused to answer the questions. Again, defense counsel asked if the officer remembered the investigator talking to Snell. After several other questions, the officer again said that he remembered that the investigator had come to take a statement from him but that he refused to give a statement.
At that point, defense counsel asked to approach the bench and then began by contending that he had not opened the door to the statement. After the prosecutor responded, defense counsel admitted that he had asked the officer whether the investigator questioned Snell. Nevertheless, defense counsel contended that the statement was a gratuitous remark on Snell's right to remain silent. While the prosecutor commented that he did not think it was a comment on silence because Snell was actually talking to the officers, the prosecutor did not have any objection to the court giving a cautionary instruction. Snell's attorney then said, "I'm just *1182 going to note my objection" and said he would make a decision later on "if I even want a curative. I may not." The court never definitively ruled on the objection, and counsel never requested a curative instruction.
Under these circumstances the issue was not preserved. A party must obtain a ruling from the trial court in order to preserve an objection for appeal. See Carratelli v. State, 832 So. 2d 850 (Fla. 4th DCA 2002). Although the court made comments which indicated that counsel opened the door to the answer given, it did not rule, and counsel did not take advantage of the offer of a curative instruction, as advocated by the state. There is no showing that the request would have been refused.
As to the remaining evidentiary issues raised, the trial court did not abuse its discretion in admitting either the traffic investigator's expert evidence, or in admitting a prior consistent statement by one of the officers. See § 90.801(2)(b), Fla. Stat. Finally, with respect to Snell's claim that, during closing argument, the prosecutor impermissibly commented on Snell's right to remain silent, the comment was not objected to and is not preserved for appeal.
Affirmed.
GROSS and HAZOURI, JJ., concur.
NOTES
[1] The alleged crime was committed in 2001, which was before section 893.101, Florida Statutes, was amended, deleting the requirement that the state prove that the defendant was aware of the illicit nature of the drugs. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1745215/ | 998 So. 2d 623 (2008)
KING
v.
STATE.
No. 5D08-1158.
District Court of Appeal of Florida, Fifth District.
December 23, 2008.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1529770/ | 146 B.R. 206 (1992)
In re Judge HARDY, d/b/a J & M Communications, Debtor.
Bankruptcy No. 92 B 2755.
United States Bankruptcy Court, N.D. Illinois, E.D.
September 11, 1992.
Kevin Murnighan, Carey, Filter, White & Boland, Chicago, Ill., for American Beeper Co.
Richard Goldman, Robert Coe & Associates, Northbrook, Ill., for debtor.
MEMORANDUM, OPINION AND ORDER
ROBERT E. GINSBERG, Bankruptcy Judge.
This matter comes before the Court on American Beeper Company's ("ABC") motion to require the debtor, d/b/a J & M Communications, to assume or reject its leases with ABC. For the reasons stated below, the Court grants ABC's motion and gives the debtor 28 days to assume or reject the ABC lease.
FACTS
ABC is an air time provider/lessor of beepers. Between May 23, 1991 and July 2, 1991, ABC leased a total of 1,100 beepers to J & M for 20-month periods at a rate of $6.50 per beeper per month, for a total payment of $130 per beeper for the term of the lease. The lease agreements are identical for all beepers and provide in pertinent part:
3. RENTAL: . . . All rents shall be paid without . . . set-off of any amount whatsoever. The operation and use of the leased equipment shall be at the sole risk of Lessee, and not of Lessor, and the obligation of Lessee to pay rent hereunder shall be unconditional.
4. DESTRUCTION OF LEASED EQUIPMENT. If any leased equipment is totally destroyed, the liability of the Lessee to pay rent therefor may be discharged by paying to Lessor all the rent due thereon, plus all the rent to become due thereon less the net amount of the recovery, if any, actually received by Lessor from insurance or otherwise for such loss or damage. Except as expressly provided in this paragraph, the total or partial destruction of any leased equipment, or total or partial loss of use or possession thereof to Lessee, shall not release or relieve Lessee from the duty to pay the rent herein provided.
*207 7. TAXES. Lessee agrees that, during the term of this lease, in addition to the rent provided herein to be paid, it will promptly pay all taxes, assessments and other governmental charges levied or assessed upon the interest of the Lessee and Lessor in the leased equipment . . .
8. TITLE OF THE LESSOR. Title to the leased equipment shall at all times remain with the Lessor . . .
10. DEFAULT. . . . (b) all sums due and to become due hereunder shall become payable forthwith, and the Lessor, in addition to being entitled to take possession of the leased equipment as hereinbefore described, also shall be entitled to recover immediately as and for damages for the breach of this lease . . . an amount equal to the difference between the aggregate rent reserved hereunder for the unexpired term of the lease . . .
15. IRREVOCABILITY. This lease is irrevocable for the full term hereof as set forth hereinabove and for the aggregate rentals herein reserved hereinabove set forth and the rent shall not abate by reason of termination of Lessee's right of possession and/or the taking of possession by the Lessor or for any other reason . . .
21. OPTION TO PURCHASE. Lessor hereby gives Lessee the option to purchase the leased equipment specified on Schedule 1 upon the expiration of the full term of this lease for the sum of one dollar ($1) per beeper set identified on Schedule 1, provided however this option to purchase is subject to the following conditions precedent . . .
On February 6, 1992, the debtor filed a petition under Chapter 11 of the Bankruptcy Code. No trustee has been appointed in the Chapter 11 case. Accordingly, the debtor has continued to run his business as a debtor in possession.
Prior to the Chapter 11 case, the debtor defaulted on its lease obligations. Accordingly, on June 26, 1992, ABC filed a Motion to Extend Time to Determine Dischargeability of a Debt and a Motion to Assume or Reject Leases, seeking to set a date for the debtor to either assume or reject its leases with J & M. Both ABC and the debtor have briefed the question of whether the beeper leases are true leases or disguised secured transactions. ABC's motion is now before the Court for decision.
JURISDICTION AND PROCEDURE
The Court has jurisdiction over this proceeding under 28 U.S.C. § 1334(b) as a matter arising under 11 U.S.C. § 365. This is a core proceeding under 28 U.S.C. § 157(b)(2)(A) as a matter involving the administration of the estate. The matter is before the Court under Local Rule 2.33 of the United States District Court for the Northern District of Illinois, automatically referring bankruptcy matters to this Court for hearing and determination.
DISCUSSION
The issue the Court must decide is whether the agreements between ABC and the debtor for the use of the beepers are true leases or disguised security instruments. If the agreements are true leases, then, under § 365 of the Bankruptcy Code, the debtor must assume or reject the unexpired leases.[1] If the agreements are security interests, the beepers are part of the debtor's bankruptcy estate, and ABC is a secured creditor, subject to any rights the debtor in possession may have to avoid ABC's security interests in the beeper. Naturally enough, ABC argues that the agreements are true leases. It wants the Court to set a date for the debtor to assume or reject the leases under § 365. The debtor, on the other hand, claims that the agreements are in fact sales with a reservation of title in ABC for security, and *208 therefore the agreements are not subject to assumption or rejection under § 365.
The determination of whether the agreements between the debtor and ABC are true leases or security agreements is governed by § 1-207(37) of the Illinois Commercial Code, which provides in relevant part:
"`Security interest' means an interest in personal property or fixtures which secures payment or performance of an obligation. . . .
Whether a transaction creates a lease or security interest is determined by the facts of each case; however, a transaction creates a security interest if the consideration the lessee is to pay the lessor for the right to possession and use of the goods is an obligation for the term of the lease not subject to termination by the lessee, and
(a) the original term of the lease is equal to or greater than the remaining economic life of the goods,
(b) the lessee is bound to renew the lease for the remaining economic life of the goods or is bound to become the owner of the goods,
(c) the lessee has an option to renew the lease for the remaining economic life of the goods for no additional consideration or nominal consideration upon compliance with the lease agreement, or
(d) the lessee has an option to become the owner of the goods for no additional consideration or nominal additional consideration upon compliance with the lease agreement.
A transaction does not create a security interest merely because it provides that
(a) the present value of the consideration the lessee is obligated to pay the lessor for the right to possession and use of the goods is substantially equal to or is greater than the fair market value of the goods at the time the lease is entered into,
(b) the lessee assumes risk of loss of the goods, or agrees to pay taxes, insurance, filing, recording, or registration fees, or service or maintenance costs with respect to the goods,
(c) the lessee has an option to renew the lease or to become the owner of the goods,
(d) the lessee has an option to renew the lease for a fixed rent that is equal to or greater that the reasonably predictable fair market rent for the use of the goods for the term of the renewal at the time the option is to be performed, or
(e) the lessee has an option to become the owner of the goods for a fixed price that is equal to or greater than the reasonably predictable fair market value of the goods at the time the option is to be performed.
For purposes of this subsection (37):
(x) Additional consideration is not nominal if (i) when the option to renew the lease is granted to the lessee the rent is stated to be the fair market rent for the use of the goods for the term of the renewal determined at the time the option is to be performed, or (ii) when the option to become the owner of the goods is granted to the lessee the price is stated to be the fair market value of the goods determined at the time the option is to be performed. Additional consideration is nominal if it is less than the lessee's reasonably predictable cost of performing under the lease agreement if the option is not exercised;
(y) "Reasonably predictable" and "remaining economic life of the goods" are to be determined with reference to the facts and circumstances at the time the transaction is entered into . . . [2]
*209 In determining if an agreement which purports to be a true lease is instead a disguised security agreement, the majority of courts have focused on three factors: (1) whether the "lessee" is required to make aggregate rental payments to the "lessor" equalling the cost of the leased property plus interest; (2) whether the option price to purchase the leased equipment at the end of the "lease" is nominal; and (3) whether the lease term covers the total useful life of the equipment. See, e.g., In re Hispanic American Television Co., Inc., 113 B.R. 453 (Bankr.N.D.Ill.1990); In re Loop Hospital Partnership, 35 B.R. 929 (Bankr.N.D.Ill.1983); In re Triple B Oil Producers, Inc., 75 B.R. 461 (S.D.Ill.1987); Matter of Marhoefer Packing Company, Inc., 674 F.2d 1139 (7th Cir.1982); Orix Credit Alliance, Inc. v. Pappas, 946 F.2d 1258 (7th Cir.1991). But see, Carlson v. Tandy Computer Leasing, 803 F.2d 391 (8th Cir.1986) (most important factors are who retains title to the equipment and whether the lessee is under a duty to purchase the equipment).
Under the test used by the majority approach, the Court first must determine whether the debtor was obligated to pay ABC the full purchase price of the beeper plus an interest charge over the term of the alleged lease. The agreement between ABC and the debtor requires the debtor to pay ABC a total lease price of $130 per beeper. In his deposition, Robert Leonardis, the president of ABC, testified that ABC purchased the beepers it leased to the debtor for $152.09 per beeper.[3] It is clear that the debtor is required to make rental payments to ABC for the duration of the lease that are less than the purchase price of the beepers. Thus, one of the central tenets of finding a security agreement instead of a lease has not been met.
The next question is whether the one dollar per beeper purchase option price at the end of the lease period is nominal. Under the Illinois Commercial Code, whether a price is nominal is determined by comparing the option price to the fair market price of the goods at the time when the option is to be exercised. Hispanic American Television Co., 113 B.R. at 459. Leonardis testified at his deposition that the fair market value of a 20-month old beeper was approximately $1 because beeper technology advances at a rapid pace, the market for beepers is dynamic, and that the typical beeper will break down approximately once per year. Judge Hardy, on the other hand, testified in his deposition that the current market price for used beepers is $25 per beeper. However, Hardy did not explain where the $25 price came from or what types of beepers it applied to.[4]
In Hispanic American Television Co., where the court did have to determine whether the purchase option price was nominal, the court relied heavily on testimony about how the price was fixed and the relative experience of the parties. In that case, the court decided that the lessor's projection of the fair market price was more persuasive since the lessee's projection might have been influenced by his consideration of the value to him of maintaining the equipment as opposed to temporarily shutting the business and replacing the equipment. Hispanic American Television Co., 113 B.R. at 459. However, in the case before this Court, there is no testimony or evidence on which the Court can rely. Thus, Hispanic American Television Co. also provides little guidance to the Court.
*210 This Court concludes that the one dollar purchase option price is nominal. At the outset, the debtor apparently could buy the beepers for $152.09. After the debtor pays $130 to lease the beeper for 20 months, he could then buy the same beeper for $1. While there is little evidence in the record about the actual value of the beepers at the end of the lease, it is hard to conclude that the one dollar option purchase price is of any significance in the context of an item that originally cost $152.09, regardless of whether the actual value of the beepers is the $25 suggested by the debtor, the $22.09 difference between the original purchase price and the lease payments, or some other number. In addition, the fact that the rental in the last month of the lease is six and one half times the option purchase price strongly suggests the option price of one dollar is nominal. See, e.g., Orix Credit Alliance, Inc. v. Pappas, 946 F.2d 1258, 1261 (7th Cir.1991). Thus, because the purchase option price is nominal, this second factor in the majority approach points toward the treatment of this transaction as a disguised secured transaction.
Finally, the Court must determine whether the agreement between ABC and the debtor covers the total useful life of the beeper. Both parties agree that a 20-month old beeper is not tossed on the trash heap. Instead, an old beeper can be refurbished and resold or relet. Thus, the old beeper would have a value to ABC. If the debtor chose not to exercise the one dollar option purchase at the end of the lease period, the debtor would be returning beepers to the lessor that would have significant value in the real world. This scenario suggests the agreement between the parties is a true lease.
In addition, the Court must consider the totality of the facts of this case. In re Hispanic American Television Co., Inc., 113 B.R. 453, 457 (Bankr.N.D.Ill.1990). Considering the realities of ABC's business, the Court must conclude that ABC truly intended only to lease the beepers to the debtor. Since ABC receives less than its capital outlay in leasing its beepers, ABC must rely on its provision of air time to its lessees in order to make a profit. It appears that the low rental payments are an incentive to beeper users to lease both their beepers and their air time from ABC. Thus, ABC would not have intended to sell the beepers to the debtor, since if the debtor owned the beepers, it could have changed the beepers' frequency and purchased its air time from a different air time supplier to ABC's detriment. Therefore, the Court finds that the parties intended a true lease.
On balance, the factors used in the majority approach lead the Court to conclude that the agreements between ABC and the debtor are true leases. Although the option purchase price is nominal, the debtor's rental payments are less than what ABC paid for the beepers. Furthermore, the agreement between ABC and the debtor does not cover the total useful life of the beepers.[5] The realities of the beeper air time provider business reinforce this conclusion. Therefore, the debtor can and should be required to assume or reject these leases before taking a plan to confirmation. ABC's beepers are the debtor's most important asset.[6] Without the beepers, the debtor is out of business. The debtor has been in Chapter 11 for more than seven months. It is not unreasonable at this point to require the debtor to commit to its ability to reorganize or not by assuming or rejecting the leases within the next 28 days.
CONCLUSION
For the reasons stated above, the Court finds that the agreements between the debtor and ABC are true leases. Accordingly, *211 ABC's motion is granted, and the debtor is ordered to assume or reject these leases within 28 days of the entry of this order.
NOTES
[1] Section 365 provides in pertinent part:
(a) . . . the trustee, subject to the court's approval, may assume or reject any . . . unexpired lease of the debtor.
(b)(4) . . . if there has been a default in an unexpired lease of the debtor, . . . the trustee may not require a lessor to provide services or supplies incidental to such lease before assumption of such lease unless the lessor is compensated . . .
[2] This section of the Illinois Commercial Code was revised in 1990. The pre-1990 section provided in relevant part:
"Whether a lease is intended as security is to be determined by the facts of each case; however, (a) the inclusion of an option to purchase does not of itself make the lease one intended for security, and (b) an agreement that upon compliance with the terms of the lease the lessee shall become or has the option to become the owner of the property for no additional consideration or for a nominal consideration."
[3] In his deposition, Judge Hardy, the owner of the debtor, testified that he had purchased similar beepers from ABC for $106 per beeper. It is unclear to the court what degree the beepers the debtors referred to in his deposition are "similar" to the beepers now before the court. Therefore, the court gives no weight to the debtor's testimony in this regard.
[4] In Marhoefer, the Seventh Circuit suggested that, under certain circumstances, a one dollar purchase option price was conclusively nominal. Marhoefer, 674 F.2d at 1142. This court does not believe those circumstances have arisen here. The property involved in Marhoefer, sausage stuffers, obviously differs greatly from the beepers involved here in value terms. In any case, Marhoefer is distinguishable from the instant case because Marhoefer did not involve the issue of whether a purchase option price was nominal.
[5] The court places little weight in the fact that the debtor has assumed all risks and paid all taxes on the beepers, since this most likely is a result only of the bargaining strength of the parties rather than their intent. See, e.g., Marhoefer, 674 F.2d at 1145.
[6] The beepers are an asset of the debtor in the sense it has a possessory right in those beepers under the leases. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920108/ | 91 B.R. 113 (1988)
In re CONSOLIDATED OPERATING PARTNERS L.P., a Delaware Limited Partnership, Debtor.
Bankruptcy No. 87 B 02896 C.
United States Bankruptcy Court, D. Colorado.
September 22, 1988.
*114 Glen E. Keller, Jr., Douglas W. Jessop, Davis, Graham & Stubbs, Denver, Colo., for debtor Consolidated Operating Partners L.P.
James B. Holden, Sherman & Howard, Denver, Colo., for creditor First Interstate Bank of California and First RepublicBank Dallas, Nat. Ass'n.
ORDER ON MOTIONS TO REQUIRE DEBTOR TO PAY ALL GENERAL UNSECURED CLAIMS PRIOR TO CONFIRMATION AND FOR VALUATION OF SECURED CLAIM
PATRICIA ANN CLARK, Bankruptcy Judge.
This matter comes before the Court on the motions of the First Interstate Bank of California and First RepublicBank Dallas, National Association (the Lenders) seeking to require the debtor to pay all general unsecured claims prior to confirmation of a plan of reorganization and for valuation of the Lenders' secured claim.
The Lenders assert that the primary objective of the bankruptcy laws is to maximize the repayment of general unsecured creditors and to repay unsecured creditors at the earliest possible date. To achieve that objective the Lenders contend that the Court should impose limitations and conditions on the operation of debtor's business pursuant to 11 U.S.C. §§ 105, 1107 and 1108. The Lenders propose that the Court require debtor to satisfy unsecured creditors prior to the confirmation of the plan through the use of proceeds from the sale of property or by the acceptance of a noninterest bearing cash advance from Lenders sufficient to pay the unsecured creditors. Lenders further contend that the payment to unsecured creditors should be made to avoid artificial circumvention of 11 U.S.C. § 1129(a)(10). The debtors assert that preconfirmation payment of unsecured creditors by a forced loan from a secured creditor violates the provisions and policies of the Bankruptcy Code.
As for the valuation of Lenders' secured claim, the Lenders maintain that they are entitled to interest accrued at the Late Payment Rate from the date of the debtor's prebankruptcy default to the effective date of confirmation of a plan. The Lenders assert that the debtor is solvent and hence, the equities dictate payment of interest at the Late Payment Rate. The Lenders submit that 11 U.S.C. § 506(b) allows default interest to be paid. The debtor disputes the imposition of any interest at the Late Payment Rate. The debtor contends *115 that the default interest provision must be construed as a penalty under Texas law. The debtor asserts that even if the default interest provision is not a penalty, the Lenders are not entitled to receive late payment interest as it is inequitable and that here the Late Payment Rate is prohibited by Section 506(b). Alternatively, the debtor asserts that the Lenders have waived their claim for default interest and they are estopped from claiming any default interest.
The essential facts are as follows. The debtor filed a Chapter 11 petition on March 17, 1987. The Lenders' claims total approximately 99 percent of all claims and the general unsecured claims total approximately 1 percent. The Lenders tendered to the Court a plan to liquidate the debtor on July 20, 1987. The debtor has tendered several non-liquidating plans to the Court. The debtor's scheduled value for the property securing the Lenders' claims is $74,200,000 and the scheduled liabilities of the debtor total $46,787,510.46. The parties agree that the debtor is solvent.
The Lenders each hold a promissory note (the Notes) signed by debtor pursuant to an October 15, 1985, credit agreement, as amended. The Notes each provide that "[a]ll past due principal of and past due interest on the Loan shall bear interest on each day outstanding at the Late Payment Rate in effect on such day, and such interest shall be due and payable immediately as it accrues." The credit agreement defines the Late Payment Rate as the Base Rate plus 4 percent per annum. The Base Rate is defined in the credit agreement as each Lender's prime rate plus a specified spread which increases slightly at various points throughout the term of the loan. Pursuant to the Note, debtor should have made a $10 million principal payment to the Lenders on March 2, 1987. The debtor failed to make that payment and has made no such payment to the present date. The Lenders advised the debtor by letter on March 2, 1987, of the existence of a default, demanded performance and stated that the Late Payment Rate was in effect for the $10 million principal payment. In addition, the Lenders advised the debtor that the Lenders had not yet accelerated, and that the Lenders reserved the right to accelerate the obligations if the debtor failed to cure by March 16, 1987.
Pursuant to a stipulation and agreement regarding limited use of cash collateral signed on April 20, 1987, the debtor has paid the regularly scheduled interest payments at the Base Rate to the Lenders. The stipulation and agreement specifically reserved the rights of the Lenders to assert a claim for interest at the Late Payment Rate and did not waive any default. The debtor also reserved its right to contest the validity of the Late Payment Rate.
As to the issue of the Lenders' request for an order requiring the debtor to pay general unsecured claims, this Court finds that the debtor cannot be forced to pay off pre-petition unsecured creditors prior to confirmation as it thwarts the debtor's ability to obtain confirmation of a plan. There is no Code provision or case authority supporting the Lenders' motion. In essence, the Lenders want to eliminate the unsecured class which would leave them in complete control of the bankruptcy proceedings in contravention of the policy of the Bankruptcy Code.
The primary purpose of Chapter 11 is to rehabilitate a going business, not, as the Lenders contend, to maximize the repayment of general unsecured creditors. See generally, Legislative Statement offered by Representative Edwards as Chairman of and by and on behalf of the Subcommittee on Civil and Constitutional Rights of the house Committee on the Judiciary, Cong.Rec. H11100-02 (daily ed. September 28, 1978). As the Fifth Circuit stated in In re Nite Lite Inns, 17 B.R. 367, 370 (Bankr.S.D.Cal.1982),
The primary purpose of the reorganization chapters of both the Act and the Code has been to promote restructuring of debt and the preservation of economic units rather than a dismantling of the estate . . . [T]he primary focus and effort of a Chapter 11 proceeding should be a reorganization. Liquidation plans should be secondary concerns unless the *116 debtor chooses such a course of action or the necessities of justice require the confirmation of a liquidation plan.
Congress did not intend that a secured creditor could, in essence, force the purchase of an unsecured claim by the debtor on behalf of the lender. The debtor seeks to retain its funds rather than pay off unsecured creditors in order to continue its business so that it may have an opportunity to obtain confirmation of its plan. The Court will not use its powers under 11 U.S.C. §§ 105, 1107 and 1108 to issue orders in contravention of Congressional intent.
The Lenders' allegation that 11 U.S.C. § 1129 is being artificially circumvented because the debtor is able to cash out the impaired unsecured claimants' amounts to an assertion of bad faith. In determining that the debtor is not acting in bad faith, the Court is guided by In re Sun Country Development, Inc., 764 F.2d 406 (5th Cir.1985). There the secured creditor contended that the plan was not submitted in good faith because the debtor changed the unsecured creditors' status from unimpaired to impaired so that the unsecureds could approve the plan and the debtor could effectuate a cram down. The Fifth Circuit did not find bad faith, noting:
Where the plan is proposed with the legitimate and honest purpose to reorganize and has a reasonable hope of success, the good faith requirement of section 1129(a)(3) is satisfied. Id. at 408.
The court confirmed the plan, stating:
Congress made the cram down available to debtors; use of it to carry out a reorganization cannot be bad faith. Id.
Thus, as the debtor's proposed plan is consistent with the criteria noted above, the debtor is not acting in bad faith by impairing its unsecured creditors.
The other issue before the Court is whether the Lenders are entitled to default interest on the past due Notes. When the debtor is solvent, the equities dictate that additional interest be paid to the secured creditor rather than to the debtor. Vanston Bondholders Protective Committee v. Green, 329 U.S. 156, 164, 67 S. Ct. 237, 240-41, 91 L. Ed. 162 (1946); Ruskin v. Griffiths, 269 F.2d 827 (2d Cir.1959) cert. denied, 361 U.S. 947, 80 S. Ct. 402, 4 L. Ed. 2d 381 (1960); and Matter of Chicago, Milwaukee, St. Paul and Pacific Railroad Co., 791 F.2d 524 (7th Cir.1986).
The enforceability of the interest term in the credit agreement is governed by state law and policy. In re Tastyeast, Inc., 126 F.2d 879, 881-882, 881 (3rd Cir.) cert. denied, Modern Factors Company v. Tastyeast, Inc., 316 U.S. 696, 62 S. Ct. 1291, 86 L. Ed. 1766 (1942), Black Ranches, Inc. v. Strand, 362 F.2d 8, 16 (8th Cir.1966); and United Merchants and Manufacturers v. Equitable Life Insurance Society, 674 F.2d 134, 141 (2d Cir.1982).
The Court finds that the default interest rate does not constitute a penalty under Texas law. By statute, Texas permits parties to any contract to agree on an interest rate as long as that rate does not exceed the statutory usury ceiling.[1] The usury ceiling varies between 18 percent and 28 percent per annum, depending on the current rate for Treasury bills. Even the lowest usury ceiling, 18 percent, is substantially in excess of the Lenders' Late Payment Rate, which floats with prime and currently is 14.125 percent per annum.
Texas also upholds contracts or promissory notes that contain specific default interest rates that are higher than the pre-default interest rates. E.g., Dixon v. Brooks, 678 S.W.2d 728 (Tex.Civ.App. 14th Dist. 1984).
*117 The Court is not persuaded by the debtor's argument that in this instance strict adherence to the parties' interest rate is not required by 11 U.S.C. § 506(b). 11 U.S.C. § 506(b) gives an oversecured creditor the right to accrue interest at the rate provided for under the agreement between the creditor and its debtor. In re Skyler Ridge, 80 B.R. 500 (Bankr.C.D.Calif.1987). The equities of this case do not favor any deviation from the imposition of the Late Payment Rate. The benefit derived from any reduction in the contract rate would not inure to the creditors but instead would be a windfall to the debtor. Such a result would mean that any solvent debtor seeking to avoid the cost of default rate interest could file for Chapter 11. No such result was intended by Congress. Under the circumstances of this case, the debtor should be held to the Late Payment Rate agreed to prior to the debtor's bankruptcy filing.
Finally, this Court finds no merit in debtor's argument that the Lenders' words and conduct constitute waiver and estoppel on the issue of late payment interest. The Lenders asserted their claim for the Late Payment Rate in the default letter sent to debtor prior to the bankruptcy filing and at various times thereafter, including the parties' cash collateral stipulation.
The Court finds that the Lenders are entitled to interest at the Late Payment Rate pursuant to their contract with the debtor. The Lenders are entitled to the Late Payment Rate on the $10 million principal payment default from March 2, 1987, through March 16, 1987, the end of the arbitrary cure period set by Lenders. The debtor's filing of its bankruptcy petition accelerated the Notes automatically. See In re Manville Forest Products Corp., 43 B.R. 293 (Bankr.1984) aff. in part and rev. in part, 60 B.R. 403 and cases cited therein. Therefore, the Late Payment Rate shall be applied on the entire principal balance from March 17, 1987, through the effective date of a confirmed plan or until some other disposition of the secured claims may occur in the debtor's bankruptcy case, less any payments made after March 17, 1987.[2] It is, therefore,
ORDERED that the Lenders' motion for an order requiring payment of general unsecured claims is denied.
FURTHER ORDERED that the Lenders' secured claims are to be valued in a manner consistent with this opinion.
FURTHER ORDERED that all questions related to the inclusion of reasonable fees, costs, and charges in the secured claims are reserved for determination at a later date.
NOTES
[1] Tex.Rev.Civ.Stat.Ann. Art. 5069-1.04(f) provides the general rule for determining interest rates on any contract. That article provides as follows:
The parties to any contract, including a contract for an open-end account, may agree to and stipulate for a rate or amount by contracting for any index, formula, or provision of law, by or under which the numerical rate or amount can from time to time be determined. However, the rate or amount so produced may not exceed the ceiling that may from time to time be in effect and applicable to the contract, for so long as a debt is outstanding under the contract.
Section (a) of the same article specifies the usury ceiling discussed in Section (f).
[2] The Court recognizes the debtor's right to decelerate this debt under 11 U.S.C. § 1124(2). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614429/ | 939 So.2d 604 (2006)
FOX ELECTRIC, L.L.C., Plaintiff-Appellee
v.
Ali MOGHIMI, Defendant-Appellant.
No. 41,197-CA.
Court of Appeal of Louisiana, Second Circuit.
September 20, 2006.
James M. Stephens, Winnsboro, Raymond L. Cannon, Tallulah, for Defendant-Appellant.
Boles Law Firm by L. Scott Patton, Monroe, for Plaintiff-Appellee.
Before STEWART, CARAWAY and LOLLEY, JJ.
LOLLEY, J.
Defendant, Ali Moghimi, appeals a default judgment rendered against him by the Monroe City Court, Parish of Ouachita, State of Louisiana, in a suit to recover a debt on an open account. In light of the legislation implemented in response to Hurricanes Katrina and Rita suspending and extending legal deadlines, we vacate the judgment and remand for a trial on the merits.
FACTS
On August 25, 2005, appellee, Fox Electric, LLC ("Fox"), filed a suit on open account naming as defendant, Ali Moghimi, alleging that Moghimi owed $2,940.00 for electrical contracting services provided, along with $53.00 in filing fees for a statement of lien and privilege together with attorney fees and legal interest. On August 26, 2005, personal service was made upon Moghimi.
On September 7, 2005, Fox filed a pleading seeking a default judgment. On September 9, 2005, Moghimi, pro se, filed a petition for Enlargement of Time requesting a 60-day extension to answer explaining that Moghimi's local attorney was not available; all his files had been forwarded to his contact person in New Orleans in hopes of retaining other legal counsel; and, due to the hurricane he was unable to reach anybody in New Orleans, including his contact person. On September 12, 2005, the trial court granted a 10-day extension. On October 3, 2005, Moghimi was served with an order extending the delay for answering by 10 days. On October 4, 2005, Moghimi, pro se, again requested a *606 60-day extension, this time based on Executive Order KBB No.2005-32 establishing emergency suspension of legal deadlines, signed by Governor Blanco in response to the hurricanes. However, the trial court denied the request.
On October 20, 2005, the trial court signed the default judgment, and recognized Fox's Lien and Privilege against Moghimi's residence. Moghimi was personally served with the judgment on October 21, 2005. On October 27, 2005, Moghimi, pro se, filed a Motion for New Trial asserting that the Executive Orders suspended all legal deadlines and therefore the default judgement should be set aside.[1] On the same day, Moghimi also filed an Answer and a Reconventional Demand. On November 4, 2005, Fox filed an Answer to Reconventional Demand. A Writ of Fieri Facias ("Fi Fa") was issued on November 14, 2005, and cash was seized from Moghimi's residence on November 17, 2005, to satisfy Fox's judgment. On November 21, 2005, Donald Studer enrolled as Moghimi's counsel and filed a Motion For Order Recalling the Writ of Fi Fa.
On December 6, 2005, a hearing was held on Moghimi's Motion for New Trial and Rule to Recall the Writ of Fi Fa. The trial court denied the Motion for New Trial, and stayed the Writ of Fi Fa pending the timely filing of an appeal. Fox deposited $4,211.46, representing funds seized from Moghimi, into the registry of court. This appeal ensued.
LAW AND DISCUSSION
Moghimi argues that the Governor's Executive Orders ("Executive Orders") suspending legal deadlines due to Hurricanes Katrina and Rita apply to the instant case and therefore the trial court erred in rendering a default judgment. Fox maintains that the default judgment was correctly rendered and believes the Executive Orders were enacted primarily to apply to lawsuits in the southern parts of Louisiana. Furthermore, Fox argues that Moghimi had the burden to prove he was adversely affected by the hurricanes.
This court recognizes the period of uncertainty and instability our judicial system experienced during the aftermath of the hurricanes. Because of the judicial climate and as we have commented before, "when dealing with a pro se litigant, it is incumbent upon the members of the bar to well represent their profession and behave with the utmost professionalism so as to avoid any appearance of attempting an unfair advantage over their pro se adversary." Youngblood v. Lee, 40,314 (La. App.2d Cir.11/02/05), 914 So.2d 1186, 1189, writ denied, 926 So.2d 522 (La.04/17/06). It is generally true that when a defendant fails to answer in the time prescribed by law a default judgment may be rendered against him. See La. C.C.P. art. 4904. However, given the Executive Orders and circumstances, the case at bar should be looked at in context.
Louisiana R.S. 9:5821(A) clearly sets forth the purpose of the suspension of legal deadlines in response to the hurricanes, codifying the Executive Orders, and states:
The legislature finds that Hurricanes Katrina and Rita created a statewide emergency disrupting and forcing the closure of certain courts and public offices and further resulting in the displacement of courts, offices, clients, and counsel. This Chapter is enacted for the benefit and protection of the state as a whole and its citizens, and to prevent injustice, inequity, and undue hardship *607 to persons who were prevented by these hurricanes from timely access to courts and offices in the exercise of their legal rights, including the filing of documents and pleadings as authorized or required by law. Therefore, this Chapter shall be liberally construed to effect its purposes. (Emphasis added.)
Furthermore, La. R.S. 9:5822(A) states, in pertinent part, that:
All prescriptions, including liberative, acquisitive, and the prescription of nonuse, and all peremptive periods shall be subject to a limited suspension and/or extension during the time period of August 26, 2005, through January 3, 2006; however, the suspension and/or extension of these periods shall be limited and shall apply only if these periods would have otherwise lapsed during the time period of August 26, 2005, through January 3, 2006.
(Emphasis added.) In addition, the supreme court has upheld other extensions of prescription periods stemming from the hurricanes. See State of Louisiana v. All Property and Casualty Insurance Carriers Authorized and Licensed to Do Business in the State of Louisiana, 2006-2030 (La.08/25/06), 937 So.2d 313.
We acknowledge that, in the instant case, at the time of the proceedings Executive Order No. KBB 2005-67 was in effect, and applicable, which extended the initial suspension to November 25, 2006. We also note that the Louisiana Supreme Court, in the same order, set forth a temporary procedure for courts to lift or shorten the suspension in appropriate cases. Here, the temporary procedure was not followed, and therefore did not effect the suspension period set forth in the Executive Order. Furthermore, every Executive Order in response to the hurricanes made clear that it applied statewide, and not only to those in the "southern part of the state" as suggested by Fox.
Nonetheless, since it is now clear that the suspension was in effect on the date that initial service was made on Moghimi, the action taken subsequent to the service is akin to a premature default judgment. Here, the prescribed period to answer had been suspended. Since the 10-day delay provided by La. C.C.P. Art. 4903 had not expired, the default judgment was premature and therefore null. Cardone v. G & R Service Center, Inc., 360 So.2d 244 (La. App. 1st Cir.1978). Because we determine that the first assignment of error is dispositive of the matter on appeal, we pretermit discussion of plaintiff's other assignments of error. Moghimi further seeks an order cancelling Fox Electric's lien. Given the underlying facts, the trial court must conduct a trial on the merits and dispense with the cancellation of the lien at that time. See generally Mayeaux v. McInnis, XXXX-XXXX (La.App. 1st Cir.09/28/01), 809 So.2d 310, writ denied, 810 So.2d 1165 (La.03/08/02).
CONCLUSION
For the foregoing reasons, we find the default judgment prematurely entered and therefore null. We hereby set aside the default judgment, and remand for trial on the merits. Costs of this appeal are assessed against appellee, Fox Electric.
REVERSED AND REMANDED.
NOTES
[1] A Motion for New Trial is the proper procedural mechanism as provided by La. C.C.P. art. 4907(B) in response to the default judgment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614433/ | 939 So.2d 1182 (2006)
JOSHUA WEBB, Appellant,
v.
FLORIDA DEPARTMENT OF CHILDREN AND FAMILY SERVICES, Appellee.
No. 4D05-1409.
District Court of Appeal of Florida, Fourth District.
October 25, 2006.
Howard M. Talenfeld and Tracey K. McPharlin of Colodny, Fass, Talenfeld, Karlinsky & Abate, P.A., Fort Lauderdale, for appellant.
Charles J. Crist, Jr., Attorney General, Tallahassee, and Charles M. Fahlbusch, Senior Assistant Attorney General, Fort Lauderdale, for appellee.
WARNER, J.
Joshua Webb appeals an order of an administrative hearing officer denying his application for Medicaid Waiver Services through the Agency of Persons with Disabilities program (APD). Webb claims that the officer erred in determining that he was not retarded, because the officer relied solely upon one full scale IQ test, without consideration of Webb's other test scores. We conclude that the officer applied a standard for eligibility contrary to the applicable statute and to the agency's published interpretations. We therefore reverse.
Joshua Webb, born in 1987, has been in foster care since the age of nine after having been removed from his mother's home and declared a dependent. He has a troubled past, including a history of left brain injury, emotional dysfunction, depression, and behavioral problems, and a long juvenile arrest record. After being placed in state care, his behavior seemed to improve somewhat, but he continued to have other problems.
Four neuropsychological evaluations have been performed on him. In 1997, when he first entered DCF care at age ten, psychologists from Nova Southeastern University performed an evaluation, testing him using the Wechsler Intelligence Scale for Children. Webb received a verbal IQ score of 66, a performance IQ score of 81, and a full scale IQ score of 71. (The full scale IQ is a mathematically derived combination of the other individual scores.) In 2003, the Dependency Court judge ordered another test, also performed by Nova. This time Webb's scores revealed a verbal IQ of 66, a performance IQ of 75, and a full scale IQ of 69. A third evaluation of Webb took place in August 2004 at the request of the Agency when Webb sought a waiver to obtain community services. This testing was performed by Dr. Janice Wilmoth, using the Wechsler Adult Intelligence Scale. Webb obtained the following scores: a verbal IQ of 77, a performance IQ of 91, and a full scale IQ of 82. Dr. Wilmoth concluded that Webb "no longer meets the standards to be deemed mildly mentally retarded." A final evaluation was performed by Dr. Appel who had been appointed by the Dependency Court to make a second evaluation of whether Webb was mentally retarded and met the waiver requirements. She used the Weschler Intelligence Scale for Children, and Webb scored a verbal IQ of 66, a performance IQ of 81, and a full scale IQ of 71.
The Agency denied Webb's request for a waiver, based upon Dr. Wilmoth's testing results. Webb requested a hearing before an administrative hearing officer. The issue for the hearing officer to determine was whether Webb was developmentally disabled within the meaning of the Agency for Persons With Disabilities program.
At the hearing, Brian Moore, the APD counselor who determined Webb's eligibility for the program, testified that he relied on the Support Coordination Guide Book in determining Webb's eligibility. The Guide Book provides that "no single score or combination of scores, tests or procedures is to be used as the sole criterion for determining eligibility." Additionally, the Guide Book provides, in pertinent part:
Any I.Q. score that is three to five points below or above 70 is to be accompanied by an interpretation of the following criteria: . . . 2. The district developmental services program has the authority to determine eligibility without additional testing if the applicant's history indicates:
a. the applicant is or has received special education classes designed to address the needs of people who have a diagnosis of mental retardation or
b. the applicant's educational records indicate that the person tested in the range of mental retardation, both intellectually and adaptively, prior to the age [of] 18 and there is no documentation that conditions other than mental retardation are responsible for the class placement or depressed scores.
Despite the Guide Book's direction to look at all the scores, Moore testified that he was instructed by the Department psychologists to use the full scale IQ scores. As a result, Moore himself placed more emphasis on the full scale than the other scores. Because Moore considered Webb's history to be close on whether he qualified for the waiver without further testing, the counselor ordered the testing which was performed by Dr. Wilmoth. After receiving those scores, he denied the application based upon Dr. Wilmoth's conclusion that Webb was not mentally retarded.
In Dr. Wilmoth's testimony at the hearing, she stood by her testing and rejected the suggestion that Webb's scores were inflated due to the "practice effect" of Webb having taken other intelligence tests. She extensively interviewed Webb regarding his prior history in addition to the testing that she performed. She used the full scale score as a portion of her analysis, combined with scales of adaptive functioning, designed to measure his ability to perform basic tasks of living. Based upon her testing, she determined that he did not meet the criteria for mental retardation. She used the Florida statutory definition of retardation, which requires test scores that are two or more standard deviations below the mean on a standardized intelligence test. She did not use a single score but relied on the full scale score combined with the adaptive functioning test. She opined that Webb's lack of functional skills were the result of an emotional disturbance, not mental retardation.
Dr. Appel strenuously disagreed with a determination that Webb was not mentally retarded. She looked to Webb's verbal IQ score of 66 when he was ten as well as his scores in 2003 and explained that under federal Social Security regulations, if any of the three scores on a standardized IQ test fall below 70, the individual qualifies as being mentally retarded. She also reviewed the 2003 tests, conducted her own tests, and concluded that at least one score from all of the tests other than Dr. Wilmoth's would qualify Webb as being mentally retarded. She attributed Dr. Wilmoth's scores to the "practice effect" and concluded that Dr. Wilmoth's testing was "totally inconsistent" with the other testing done on Webb.
The hearing officer issued an opinion in which he "considered" the evidence of both Dr. Wilmoth and Dr. Appel, including the "practice effect" argument along with all of the other arguments. He quoted from the statutory definitions and made the following conclusions:
In this case, the petitioner has the burden of proof as an applicant to show that he qualifies for the program, as explained in the Florida Administrative Code at 65-2.060. It is determined that this burden has not been met. According to the cited Statute, retardation means significantly subaverage general intellectual functioning existing concurrently with deficits in adaptive behavior and manifested during the period from conception to age 18. Also included in the definition is significantly subaverage general intellectual functioning with a performance that is two or more standard deviations from the mean score on a standardized intelligence tests.
The petitioner obtained a Full Scale I.Q. score of 82, prior to his eighteenth birthday. This indicates that he is functioning within the low ranges of below average intelligence, however he is not significantly subaverage in general intellectual functioning, with a performance which is two or more standard deviations from the mean score on a standardized intelligence test. After careful consideration, it is determined that the action of denying the application for the Agency For Persons With Disabilities Program (APD) Home and Community Based Medicaid Waiver Services, because the petitioner's test scores do not place him in the mentally retarded ranges, is upheld.
From this order, Webb appeals, contending that the hearing officer applied an incorrect standard in evaluating the evidence.
When an agency determines an applicant is ineligible for services, the applicant has the right to a "fair hearing" under the provisions of Florida Administrative Code Rule 65-2.042, et seq. Pursuant to rule 65-2.056(3), "[t]he Hearing Officer shall determine whether the action taken by the Agency was correct at the time the action was taken." The burden of proof is on the applicant in cases where the Department denies an application. Fla. Admin. Code R. 65-2.060.
We apply a deferential standard of review to factual conclusions of a hearing officer in disability cases but not to conclusions of law, including the proper standards to apply to the disability determination. See Axilrod v. Dep't of Children & Family Servs., 799 So. 2d 1103 (Fla. 4th DCA 2001).
Webb maintains that both the agency and the hearing officer erred in determining that Webb was not mentally retarded by relying exclusively upon one full scale IQ score which did not fall below two standard deviations from the mean test score on a standardized intelligence test. Webb points out that he had multiple other tests which met that standard and argues that reliance on the full scale score only is precluded by section 393.063(38), Florida Statutes (2004).[1] He considers the hearing officer's reference to the full scale IQ score as setting the legal standard upon which he determined the issue.
Pursuant to the Home and Community Based Services Waiver Act, Title XIX of the Social Security Act, 42 U.S.C. § 1396n(c), Congress has authorized certain persons with developmental disabilities to receive Medicaid services in a community setting. This Act enables the Secretary of Health and Human Services to grant a waiver to a state under which approved costs of home and community-based services are reimbursed for eligible individuals who elect to remain in their homes, but who otherwise would require care in an institutional facility. See 42 U.S.C. § 1396n(c); Prado-Steiman ex rel. Prado v. Bush, 221 F.3d 1266, 1268 (11th Cir. 2000).
Florida has elected to participate in the Home and Community Based Waiver Program. See Fla. Admin. Code R. 59G-13.080. To be eligible for the waiver program, an applicant must have a developmental disability as defined in Chapter 393, Florida Statutes. See Developmental Services Waiver Services Florida Medicaid Coverage and Limitations Handbook, p. 2-2; Fla. Admin Code R. 59G-13.080(12) (incorporating the handbook by reference).
The hearing officer was charged with determining whether the agency's action in denying the benefits was correct when taken that is, whether Webb was disabled within the statutory definition. A "developmental disability" is defined as "a disorder or syndrome that is attributable to retardation, cerebral palsy, autism, spina bifida, or Prader-Willi syndrome and that constitutes a substantial handicap that can reasonably be expected to continue indefinitely." § 393.063(10), Fla. Stat. (2004). The term "retardation" means "significantly subaverage general intellectual functioning existing concurrently with deficits in adaptive behavior and manifested during the period from conception to age 18." § 393.063(38), Fla. Stat. (2004). "Significantly subaverage general intellectual functioning" is in turn defined as "performance which is two or more standard deviations from the mean score on a standardized intelligence test specified in the rules of the agency." § 393.063(38), Fla. Stat. (2004). Further, "Adaptive Behavior" is defined as "the effectiveness or degree with which an individual meets the standards of personal independence and social responsibility expected of his or her age, cultural group, and community." Id.
The agency has not adopted rules which specify the type of standardized intelligence test to utilize in determining "significantly subaverage general intellectual functioning." Further, there are no rules with respect to the interpretation of intelligence tests for purposes of determining retardation, nor are there any other rules which govern the determination of retardation. Therefore, the statute alone determines the legal standard to apply. Thus, the criteria for determining developmental disability are: 1) a disorder or syndrome; 2) attributable to retardation; 3) constituting a substantial handicap; 4) which can reasonably be expected to continue indefinitely. The criteria for determining retardation are: 1) performance which is two or more standard deviations from the mean score on a standardized intelligence test; 2) existing concurrently with deficits in adaptive behavior; and 3) manifested before age 18.
The hearing officer failed to correctly apply the legal test of the statute. The criteria for determining retardation required only that the applicant obtain a qualifying score prior to his eighteenth birthday and concurrently exhibit deficits in adaptive behavior. Rather than focus on the scores which showed that Webb met this qualification, the hearing officer instead looked only to a score which did not meet the statutory definition. He thus ignored the legal standard for retardation set forth in the statute. Because he went no further than determining that Webb obtained a score which would not constitute mental retardation under the statute, he did not make any other findings which would apply the standard correctly.
Where the applicant achieves a qualifying score more than two deviations below the mean score on a standardized intelligence test prior to his eighteenth birthday, which Webb did on several other tests, then the hearing officer must determine whether, concurrently, deficits in adaptive behavior were observed, and the officer must make a finding of fact on this issue. Next, the officer must determine whether the retardation manifests itself in a disorder or syndrome which constitutes a substantial handicap. Finally, the officer must determine whether the substantial handicap can reasonably be expected to continue indefinitely.
In Webb's case, the hearing officer failed to make the necessary findings, given the legal standard set forth in the statute. The evidence was undisputed that on other tests Webb had scored in a range to meet the first criteria for retardation, and the hearing officer made no findings that the prior tests were invalid. Therefore, the hearing officer should have gone to the next criteria, namely determining whether he also exhibited deficits in adaptive behavior. The hearing officer failed to make any finding on this factor or on the remaining factors, including whether the disorder or syndrome may be reasonably expected to continue indefinitely.
It is clear that the hearing officer relied on the results of Dr. Wilmoth's tests and her opinions. Those tests and opinions offer evidence on the other criteria which also must be met, namely whether the retardation observed results in a substantial handicap which can be reasonably expected to continue indefinitely. Dr. Wilmoth attributed Webb's improved scores to a diagnosis of emotional disturbance, not retardation. With treatment his lower intelligence IQ would not continue indefinitely. Of course, there was other evidence, including the testimony of Dr. Appel, which disputed Dr. Wilmoth's observations. However, the hearing officer did not make any findings on these other factors.
We reject Webb's reliance on federal Social Security disability regulations which he claims would mandate his qualification as developmentally disabled because he scored below an IQ of 70 on one test. He suggests that the Florida Legislature, in using language identical to the definition of "mental retardation" in the Social Security regulations, necessarily intended the federal Social Security regulations to apply with respect to the interpretation of intelligence tests for purposes of determining retardation under Chapter 393 of the Florida Statutes. He simply argues that it is reasonable to assume that the Florida Legislature intended the Social Security regulations to apply because both Chapter 393 and the Social Security Administration utilize the standard definition of retardation set forth in the Diagnostic and Statistical Manual of Mental Disorders. However, Webb cites to no authority which indicates that the Florida Legislature intended regulations promulgated by the Social Security Administration to apply to Chapter 393.
Moreover, even if we were to apply the Social Security regulations in determining his eligibility for waiver services, his verbal IQ score of 66 in 1997 would not automatically qualify him for services under the disability standards in the Social Security regulations. The Social Security Administration has adopted rules regarding the interpretation of IQ tests to determine retardation for purposes of SSDI eligibility. The relevant Social Security regulation provides that, "[i]n cases where more than one IQ is customarily derived from the test administered, e.g., where verbal, performance, and full scale IQs are provided in the Wechsler series, we use the lowest of these in conjunction with 12.05." 20 C.F.R. Pt. 404, Subpt. P, App. 1, at § 12.00(D)(6)(c) (2006). Webb points to this language in arguing that he should be deemed eligible for waiver services as of 1997, when he received a verbal IQ score of 66.
Under provision 12.05 of the Social Security Administration's Listing of Impairments, one basis for determining that a person has the required level of severity of mental retardation is if that person has:
D. A valid verbal, performance, or full scale IQ of 60 through 70, resulting in at least two of the following:
1. Marked restriction of activities of daily living; or
2. Marked difficulties in maintaining social functioning; or
3. Marked difficulties in maintaining concentration, persistence, or pace; or
4. Repeated episodes of decompensation, each of extended duration.
20 C.F.R. Pt. 404, Subpt. P, App. 1, at § 12.05. Additionally, the Social Security regulations require any mental disability determination to be made on the basis of longitudinal evidence. See 20 CFR Pt. 404, Subpt. P., App. 1 12.00(D)(2) ("Need for longitudinal evidence. Your level of functioning may vary considerably over time. The level of your functioning at a specific time may seem relatively adequate or, conversely, rather poor. Proper evaluation of your impairment(s) must take into account any variations in the level of your functioning in arriving at a determination of severity over time. Thus, it is vital to obtain evidence from relevant sources over a sufficiently long period prior to the date of adjudication to establish your impairment severity."). Even under the Social Security regulations, the results of one IQ test would not necessarily qualify a person as retarded. Therefore, even if we were to agree with Webb and apply the Social Security regulations, it is clear that additional fact-finding would be required in this case to determine if Webb had the required level of severity of mental retardation to qualify for services.
Although we reject Webb's reliance on the Social Security disability regulations, we agree that the hearing officer used an erroneous legal standard in upholding the agency's denial of his application for waiver services. Because the hearing officer did not use the correct legal standard as contained in the statute for determining whether Webb was developmentally disabled, we reverse and remand for further proceedings in accordance with this opinion.
GROSS and HAZOURI, JJ., concur.
Not final until disposition of timely filed motion for rehearing.
NOTES
[1] Due to a statutory amendment by the legislature in 2006, the definition of retardation is now set forth in section 393.063(31), Florida Statutes (2006). See Laws of Fla. Ch. 2006-227. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614441/ | 939 So.2d 369 (2006)
Ray Don EVERETT
v.
RUBICON, INCORPORATED, and Huntsman Chemical Corporation.
No. 2006-C-1785.
Supreme Court of Louisiana.
October 13, 2006.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614450/ | 939 So.2d 755 (2005)
The MISSISSIPPI BAR
v.
Rodney E. REXRODE.
No. 2005-BD-00872-SCT.
Supreme Court of Mississippi.
October 26, 2005.
*756 ORDER OF DISBARMENT
JESS H. DICKINSON, Justice, for the Court.
¶ 1. This matter came before this Court sitting en banc on the Mississippi Bar's Formal Complaint against Rodney E. Rexrode, an attorney resident of the Commonwealth of Pennsylvania, admitted to practice in Mississippi, and subject to the disciplinary jurisdiction of this Court. Disbarment proceedings which Rexrode did not contest were previously instituted against him in Pennsylvania, and the Supreme Court of Pennsylvania disbarred him on April 19, 1999, retroactive to April 20, 1998, Office of Disciplinary Counsel v. Rexrode, 556 Pa. 587, 730 A.2d 469 (1999). See also Office of Disciplinary Counsel v. Rexrode, 556 Pa. 587, 707 A.2d 1142 (1998).
¶ 2. The Mississippi Bar filed its Formal Complaint against Rexrode pursuant to Rule 13 of the Mississippi Rules of Discipline, seeking disbarment of Rexrode in Mississippi. The Mississippi Bar further requests this Court to require Rexrode, within fourteen days of disbarment, to notify all of his Mississippi clients of his disbarment and inability to continue as their attorney, and that they should seek alternate legal counsel. Finally, the Bar seeks recovery of its costs and expenses.
¶ 3. Rexrode was served with process through the Executive Director of the Mississippi Bar in accordance with Rule 16 of the Rules of Discipline, and in addition he was personally served, by mail, with notice, summons, and formal complaint on May 16, 2005; thus, this Court has personal jurisdiction over Rexrode in this matter. Rexrode does not contest these proceedings.
¶ 4. The misconduct leading to the Mississippi Bar's Formal Complaint was essentially the same conduct that resulted in his Pennsylvania disbarment. He engaged in business transactions with clients without informing them of the risks involved or advising them to seek independent counsel. Thus, he advanced his personal financial interests to the detriment of his clients. Furthermore, he failed to fulfill his contractual obligations to the clients. The Disciplinary Board of the Supreme Court of Pennsylvania found that Rexrode had violated Rules 1.8(a), 8.4(b), and 8.4(c) of the Rules of Professional Conduct in his representation of one client and Rules 1.3, 1.4(b), and 1.8(a) of the Rules of Professional Conduct in his representation of another client. The Disciplinary Board also found that his violations were aggravated by his failure to pay restitution to his clients, his failure to comply with his contractual obligations to his clients, and his failure to reimburse the Lawyers Fund for Client Security after it awarded compensation to one of his clients.
¶ 5. The first client injured by Rexrode's misconduct was the Meridian Corporation for whom Rexrode was corporate counsel. After receiving a payroll advance in the amount of $50,000 to finance his automobile racing business, Rexrode wrote three checks to Meridian as reimbursement, each of which bounced for insufficient funds. Meridian was reimbursed the $50,000 payroll advance only after filing a claim with the Pennsylvania Lawyers *757 Fund for Client Security. Rexrode failed to reimburse the Lawyers Fund.
¶ 6. The second client injured as a result of Rexrode's misconduct was Gerald Stern, who retained Rexrode to handle legal matters concerning his dry cleaning business and to advise him concerning his divorce settlement. After Stern requested that Rexrode inform him of business opportunities, Rexrode informed Stern of one of his clients who was seeking to sell his limousine business. Stern and Rexrode agreed to purchase the business together and that Stern would provide the purchase money and manage the daily operations of the business while Rexrode would provide all legal services, including obtaining the transfer of the Public Utility Commission license. Rexrode was also to pay Stern's living expenses for a few months until the business became profitable. Stern tendered the purchase price and signed a contract for purchase of the business assets. However, Rexrode did not proceed to obtain transfer of the PUC license, forcing Stern to close the limousine business. The Disciplinary Board was unsure what happened to the initial investment which Stern never recovered.
¶ 7. Under Rule 13 of the Mississippi Rules of Discipline, the sanction from the other jurisdiction is itself conclusive evidence of the guilt of the offense or unprofessional conduct. It is not necessary to prove the grounds for the discipline again in this state.
The sole issue to be determined in the disciplinary proceeding in this state shall be the extent of the final discipline to be imposed on the attorney, which may be less or more severe than the discipline imposed by the other jurisdiction.
Miss. Rule of Discipline 13. After careful consideration of the facts before us, we find that the extreme sanction of disbarment is appropriate. We further find that the other relief requested by the Mississippi Bar is both reasonable and appropriate.
¶ 8. IT IS THEREFORE ORDERED that effective upon entry of this order Rodney E. Rexrode is hereby disbarred from the practice of law in the State of Mississippi.
¶ 9. IT IS FURTHER ORDERED that Rexrode shall bear all costs and expenses of these proceedings and shall pay to the Mississippi Bar its actual and reasonable expenses as provided for under Rule 27 of the Rules of Discipline.
¶ 10. IT IS FURTHER ORDERED that immediately following entry of this order, Rexrode shall take action to protect the interest of his clients as provided under Rule 11 of the Rules of Discipline, including but not limited to (1) giving to all clients notice of his disbarment and his consequent inability to act as an attorney as of the effective date of this order; (2) notifying each client involved in pending litigation or administrative proceedings and the attorney or attorneys for each adverse party in such proceedings, of his disbarment and consequent inability to act as an attorney after the effective date of this order; (3) advising each client promptly to substitute another attorney or attorneys in his place or to seek legal advice elsewhere; and (4) notifying all affected courts and agencies of his disbarment and consequent inability to act as an attorney after the effective date of this order.
¶ 11. IT IS FURTHER ORDERED that the Clerk of this Court shall mail certified copies of this order to the clerks of the Supreme Court of the United States, the United States Courts of Appeals for the Fifth Circuit, the United States District Courts for the Northern and Southern Districts of Mississippi, and Mississippi courts wherein Rexrode is known to practice.
*758 ¶ 12. IT IS FURTHER ORDERED that the Clerk of this Court shall send, via certified mail, a certified copy of this order to Rodney E. Rexrode whose last known address is 104 East Springettessbury Avenue, York, Pennsylvania 17403.
¶ 13. SO ORDERED, this the 26th day of October, 2005.
DIAZ, J., NOT PARTICIPATING. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614458/ | 939 So.2d 21 (2006)
CERTAIN UNDERWRITERS AT LLOYD'S, LONDON, and Certain London Market Insurance Companies
v.
SOUTHERN NATURAL GAS COMPANY.
1041880.
Supreme Court of Alabama.
March 24, 2006.
*22 Richard W. Lewis, William K. Bradford, and Douglas H. Bryant of Austill, Lewis & Simms, P.C., Birmingham; Deborah Alley Smith of Christian & Small, LLP, Birmingham; and Jay Russell Sever of *23 Phelps Dunbar, LLP, New Orleans, Louisiana, for appellants.
Tony G. Miller of Maynard, Cooper & Gale, P.C., Birmingham; and Michael John Miguel of Morgan, Lewis & Bockius, LLP, Los Angeles, California, for appellee.
HARWOOD, Justice.
Certain Underwriters at Lloyd's, London, and Certain London Marketing Insurance Companies (collectively "the Insurers") appeal from an order of the Jefferson Circuit Court, entered at the conclusion of a trial conducted from February 28 to March 10, 2005, and assessing damages against the Insurers in favor of the plaintiff, Southern Natural Gas Company ("Sonat"), for nearly $1 million. The Insurers have appealed that judgment but have also moved this Court for an expedited determination of appellate jurisdiction, contending that the order does not constitute a final judgment that can support an appeal. In particular, the Insurers assert that the order did not completely dispose of any single "claim for relief" and that, consequently, the trial court's attempted certification of the "judgment" as final pursuant to Rule 54(b), Ala. R. Civ. P., was unavailing and should be vacated by this Court and the appeal dismissed. Based on our analysis set forth below, we agree.
Background
Sonat operates approximately 14,000 miles of pipeline in the southeastern United States for the purpose of transporting natural gas to markets in a seven-state area. As Sonat explains in the complaint it filed to institute the underlying litigation, its "integrated pipeline operations" include, among other operational features, numerous "compressor stations," including 11 located in Alabama, and numerous "mercury-metering stations," including 131 located in Alabama. The Insurers provide a balanced summary of the circumstances giving rise to the action in their principal brief to this Court:
"From 1957 to 1972, Sonat used a PCB-based[[1]] synthetic lubricant at many of its compressor stations. Environmental testing performed by Sonat in 1989 revealed that 13 of its 38 compressor stations had PCB contamination. Sonat also allegedly sustained environmental damage to its property at 14,700 other sites, including 25 additional compressor stations; 650 mercury metering stations; 14,000 liquid removal points; five manufactured gas plants; and 20 offshore platforms. Sonat voluntarily undertook to remediate the contamination at its sites.
"In 1991 Sonat put [the Insurers] on notice that it had discovered contamination at 13 of its compressor stations and that it had taken action to contain and remediate the contamination. In November 1995, counsel for [the Insurers] sent Sonat a reservation of rights letter with respect to the claim made by Sonat. In 1996 Sonat advised [the Insurers] that the cleanup had been completed and that [the Insurers] should close their files on the claim."
(The Insurers' brief, pp. 6-7.)
In the action it subsequently filed against the Insurers, Sonat asserted that the Environmental Protection Agency, "other governmental agencies and departments and/or private parties," including Alabama residents, "have brought or asserted lawsuits, claims, and demands against Sonat alleging property damage, personal injury, bodily injury, and other damages and causes of action, including, without limitation, nuisance, trespass, negligence and strict liability, allegedly as a *24 result of Sonat's operations and ownership" of the pipeline system. Sonat asserted that it had "paid substantial amounts under legal obligation for the remediation of damage in, at, and around the vicinity of compressor stations, and for mercury damage arising from mercury meters." Sonat went on to explain that the contamination experienced at the compressor stations involved principally the presence of PCBs and the contamination at the mercury-metering stations involved principally "the presence of mercury in the ground water, surface water, air and general environment in, at, around, and in the vicinity of the mercury-metering stations."
Sonat stated in its complaint that the Insurers had issued various policies of liability insurance, covering successive policy periods commencing on November 30, 1949, and concluding on December 1, 1987, which entitled Sonat to coverage "for all sums, including costs of investigation and defense and legal liabilities, arising out of environmental and tort actions. . . ." In paragraph 32 of the complaint (captioned "Environmental and Tort Action Concerning Reform, Alabama[,] Compressor Station"), Sonat alleged:
"Claims, demands and suits have been asserted against Sonat concerning property damage and other damages arising out of Sonat's operation of the Reform, Alabama[,] compressor station. The claimants in the environmental actions, allege, inter alia, damage and other injury based on purported damage including the presence of polychlorinated biphenyls and other substances of concern in the environment in, at, around, and in the vicinity of the Reform, Alabama[,] compressor station. Claimants seek damages for past and future response costs for alleged property damage which is continuous and progressive, beginning in or before 1949 and extending until at least 1986. The monies spent and to be spent in response to demands of a governmental agency, or a private party are `damages' under the Liability Insurance Policies.[[2]] Alabama Plating Co. v. United States Fidelity and Guar. Co., 690 So.2d 331 (Ala.1996). As such, the Liability Insurance Policies respond to and are required to pay for all damage because of property damage, bodily injury or personal injury (or a combination thereof) which Sonat is or becomes legally obligated to pay as respects the Reform, Alabama[,] compressor station. Sonat has paid, and is likely to continue to become legally obligated to pay, damages arising from the Reform, Alabama[,] compressor station."
By means of the next four paragraphs of its complaint, introduced by identical captions except for the name of the location of the compressor station, and making identical averments, Sonat made precisely parallel allegations concerning the compressor stations located at Elmore, Gallion, McConnells, and Tarrant, Alabama.
Thereafter, Sonat undertook in its complaint to delineate five separately captioned claims for relief. The claims respectively asserted that although the Insurers were obligated to pay in full Sonat's legal liabilities arising out of or in connection with the previously described "environmental and tort actions," the Insurers had "failed, or threatened to fail, to fulfill, or acknowledge completely their insuring obligations to pay in full Sonat's legal liabilities"; that *25 there was an actual and justiciable controversy as to the Insurers' obligations in that regard (first claim for relief); that the Insurers had breached their insuring obligations to Sonat and were obligated to pay Sonat "all direct, indirect, consequential, incidental, special, compensatory and other damages resulting from" the breaches of contract (second claim for relief); that the conduct of the Insurers effected a waiver of their right "to enforce any contractual obligation, limitation, exclusion, or other provisions running in [their] favor" and Sonat was entitled to a judicial declaration to that effect (third claim for relief); that the Insurers had breached their contracts of insurance by "disclosing confidences of Sonat and confidential settlement communications of Sonat in violation of their contractual duties to act with good faith and with reasonable care and prudence with regard to their insured," thereby waiving the Insurers' "ability to enforce any contractual obligation, limitation, exclusion, or other provision running in [their] favor," entitling Sonat to a judicial declaration to that effect (fourth claim for relief); and that the conduct of the Insurers represented an anticipatory breach of contract entitling Sonat to recover damages (fifth claim for relief). In its concluding "prayer for relief," Sonat demanded judgment by way of a judicial declaration that the Insurers were "obligated to pay or reimburse in full Sonat's cost and expenses for investigation and defense of the environmental and tort actions and to pay or reimburse in full Sonat's legal liabilities in connection with said environmental and tort actions" and to pay an award for "compensatory damages in an amount or amounts to be determined by the trier of fact at trial, and attorneys' fees and costs."
Eventually, the trial court entered two case-management orders pertinent to the jurisdictional issue before this Court. The first order provided:
"Considering the number of sites at issue in this litigation and the complexity of the issues involved, it is necessary that the trial of this matter be conducted in phases, as follows:
"Trial Phase I: Trial Phase I shall involve the parties' claims and defenses relative to the availability of insurance coverage for a subset of those sites listed in Exhibit `A' ('Phase I Sites'), as agreed to by the parties or ordered by the Court in the future."
Exhibit A listed dozens of "compressor stations/PCBs" in Alabama, Georgia, Louisiana, and Mississippi, several hundred "meter and compressor stations/mercury" located in Florida, South Carolina, Alabama, Georgia, Louisiana, Texas, and Tennessee, and several dozen "offshore facilities." The second case-management order explained that "[t]he initial trial phrase in this action shall focus on the claims and defenses related to the Tarrant, Alabama, and Reform, Alabama, locations," those being two of the Alabama "compressor stations/PCBs" identified on Exhibit A to the first case-management order.
At the conclusion of the trial relating to those two sites, the jury responded to a set of 14 special interrogatories, identifying 9 separate policies as having been in existence and finding 1) that an "occurrence" had occurred under both definitions of that term in the two applicable insurance policies; 2) that notice to the Insurers of any occurrence was not late with respect to either the Tarrant or the Reform compressor station; 3) that Sonat had not waived its claim; 4) that "a single occurrence caused the property damage[] at Tarrant compressor station and Reform compressor station"; 5) that at both locations there was damage to property owned by third *26 parties other than Sonat; 6) that the property damage at both stations began in 1957 and ended in 1988; 7) that the amounts paid by Sonat with respect to both compressor stations were paid because Sonat "was legally obligated to pay them as damages"; 8) that soil contamination at the two sites was not "expected or intended" by Sonat; 9) that the Insurers had breached the contracts, doing so on November 13, 1995; and 10) specifying the total amounts Sonat was entitled to recover "as a result of PCB contamination" at each site. Lastly, the jury declared that three specific policies were "excess of $50,000 in underlying insurance."
The PCB contamination at the various compressor stations resulted from Sonat's use throughout its system of the synthetic lubricant "Pydraul," composed partly of PCBs. In moving the trial court for the entry of a judgment in response to the jury's answers to the special interrogatories, Sonat asserted that its "damages were, in fact, caused by the systematic use of Pydraul, causing damages at the compressor stations, which constitutes a single occurrence." The Insurers opposed the entry of a final judgment, arguing that the only authority for such a judgment would be Rule 54(b), Ala. R. Civ. P., but contending that the court could not certify its order under that rule because none of Sonat's claims had been completely resolved. The first sentence of Rule 54(b) provides:
"When more than one claim for relief is presented in an action, whether as a claim, counterclaim, cross-claim, or third-party claim, or when multiple parties are involved, the court may direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment."
(Emphasis supplied.)
Rule 42(b), Ala. R. Civ. P., provides:
"The court, in furtherance of convenience or to avoid prejudice, or when separate trials will be conducive to expedition and economy, may order a separate trial of any claim, cross-claim, counterclaim, or third-party claim, or of any separate issue or of any number of claims, cross-claims, counterclaims, third-party claims, or issues, always preserving inviolate the right of trial by jury as declared by Article 1, Section 11 of the Alabama Constitution of 1901."
(Emphasis supplied.)
The Insurers argued to the trial court that instead of certifying its order under Rule 54(b), the court should certify appropriate issues for an interlocutory appeal pursuant to Rule 5, Ala. R.App. P. The Insurers committed that they could stipulate with Sonat the issues the court could certify for an interlocutory appeal taken pursuant to Rule 5. On June 17, 2005, the trial court entered its "judgment" in favor of Sonat against the Insurers for monetary damages and stating, with respect to the issue of Rule 54(b) certification, the following:
"Defendants contend that a partial final judgment is not appropriate. In Grantham v. Vanderzyl, 802 So.2d 1077 (Ala.2001), it was held that the trial court's decision to dismiss claims for loss of income and fear of contracting a communicable disease were not properly certified as final. The order dismissing the claim on the tort of outrage was appealable.
"In Norfolk Southern Corp. v. California Union Ins. Co., 859 So.2d 167 (La. Ct.App.2003), an appeal was taken involving only alleged contamination sites *27 in Louisiana although the petition alleged sites in other states.
"In this case the parties agreed to try the issues on the sites at Tarrant and Reform. All the issues on these sites were tried. Therefore, it appears that a final judgment on these claims is appropriate.
". . . .
"The judgment is certified as final pursuant to Rule 54(b), there being no cause for delay and entry of judgment should be final."
Analysis
It is clear that in this case the trial court did not order a "severance" of the claims relating to the Reform and Tarrant compressor stations, pursuant to Rule 21, Ala. R.App. P. ("any claim against a party may be severed and proceeded with separately"), but rather simply ordered separate trials of those issues pursuant to Rule 42(b), Ala. R. Civ. P. See Key v. Robert M. Duke Ins. Agency, 340 So.2d 781 (Ala.1976).
"As this Court stated in Foster v. Greer & Sons, Inc., 446 So.2d 605, 610 (Ala.1984), `Rule 54(b) certifications should be granted only in exceptional cases and "should not be entered routinely or as a courtesy or accommodation to counsel." Page v. Preisser, 585 F.2d 336, 339 (8th Cir.1978).' The Committee comments to Rule 54 note:
"`The rule provides that, in the absence of affirmative action by the judge, no decision is final until the entire case has been adjudicated. The one exception is that where the court has completely disposed of one of a number of claims, or one of multiple parties, and has made an express determination that there is no just reason for delay, the court may direct the entry of judgment on that claim or as to that party.' (Emphasis added).
"Committee comments, Rule 54, [Ala. R. Civ. P.]
"The question before this Court is whether the partial summary judgment LSC received completely disposed of a claim so as to make that judgment final. Rule 54(b) does not authorize the entry of final judgment on part of a single claim. Tolson v. United States, 732 F.2d 998, 999 (D.C.Cir.1984). Neither federal nor state courts have been able to settle on a single test to determine when claims are separate or exactly what constitutes a claim. See, Tolson, 732 F.2d at 1001; Cates v. Bush, 293 Ala. 535, 307 So.2d 6 (1975). However, authorities have stated that `when plaintiff is suing to vindicate one legal right and alleges several elements of damage, only one claim is presented and subdivision (b) [of rule 54] does not apply.' 10 C. Wright, A. Miller, & M. Kane, Federal Practice and Procedure: Civil 2d, § 2657, at 69-71 (1983); Landry v. G.B.A., 762 F.2d 462, 464 (5th Cir. 1985)."
Precision American Corp. v. Leasing Serv. Corp., 505 So.2d 380, 381 (Ala.1987).
"The sine qua non of [Rule 54's] applicability is the existence of multiple parties or claims. The rule confers appellate jurisdiction over an order of judgment only where the trial court `has completely disposed of one of a number of claims, or one of multiple parties.' Rule 54(b), committee comments (emphasis added). In other words, the `trial court cannot confer appellate jurisdiction upon this court through directing entry of judgment under Rule 54(b) if the judgment is not otherwise "final."' Robinson v. Computer Servicenters, Inc., 360 So.2d 299 (Ala.1978). `That a judgment is not final when the amount *28 of damages has not been fixed by it is unquestionable.' 'Automatic' Sprinkler Corp. of America v. B.F. Goodrich Co., 351 So.2d 555, 557 (Ala.1977); see also Moody v. State ex rel. Payne, 351 So.2d 547 (Ala.1977)."
Tanner v. Alabama Power Co., 617 So.2d 656, 656-57 (Ala.1993).
"[F]or a Rule 54(b) certification of finality to be effective, it must fully adjudicate at least one claim or fully dispose of the claims as they relate to at least one party." Haynes v. Alfa Fin. Corp., 730 So.2d 178, 181 (Ala.1999).
"If an order does not completely dispose of or fully adjudicate at least one claim, a court's Rule 54(b) certification of the order is not effective. See Haynes v. Alfa Fin. Corp., 730 So.2d 178 (Ala.1999). Damages are only one portion of a claim to vindicate a legal right, even though the damages claimed may consist of several elements. See id. at 181. An order is not final if it permits a party to return to court and prove more damages or if it leaves open the question of additional recovery. See Precision American Corp. v. Leasing Serv. Corp., 505 So.2d 380, 382 (Ala.1987)."
Grantham v. Vanderzyl, 802 So.2d 1077, 1080 (Ala.2001).
"To be sure, the trial court recited the formula for certification of a judgment pursuant to Rule 54(b), Ala. R. Civ. P. However, `[n]ot every order has the requisite element of finality that can trigger the operation of Rule 54(b).' Goldome Credit Corp. v. Player, 869 So.2d 1146, 1147 (Ala.Civ.App.2003) (emphasis added). A claim is not eligible for Rule 54(b) certification unless it has been completely resolved by the judgment. In that regard, it must be remembered that `[d]amages are [an element] of a claim to vindicate a legal right.' Grantham v. Vanderzyl, 802 So.2d 1077, 1080 (Ala.2001).
"`Where the amount of damages is an issue, . . . the recognized rule of law in Alabama is that no appeal will lie from a judgment which does not adjudicate that issue by ascertainment of the amount of those damages.' Moody v. State ex rel. Payne, 351 So.2d 547, 551 (Ala.1977). `That a judgment is not final when the amount of damages has not been fixed by it is unquestionable.' `Automatic' Sprinkler Corp. of America v. B.F. Goodrich Co., 351 So.2d 555, 557 (Ala. 1977) (recitation of the Rule 54(b) formula was ineffective to render appealable a judgment that resolved liability, but reserved the issue of damages for future resolution). `[T]he trial court cannot confer appellate jurisdiction upon this [C]ourt through directing entry of judgment under Rule 54(b) if the judgment is not otherwise "final."' Robinson v. Computer Servicenters, Inc., 360 So.2d 299, 302 (Ala.1978). Thus, it is well-established that a claim for which damages are sought is insufficiently adjudicated for Rule 54(b) purposes until the element of damages is resolved; a judgment resolving only liability in an action seeking damages cannot be certified as final pursuant to Rule 54(b). Tanner v. Alabama Power Co., 617 So.2d 656 (Ala.1993).
"That this case suffers from this defect is self-evident. The trial court purported to certify for appellate review the default judgment of 35 counterclaims, 29 of which sought damages that are yet to be determined. Because the trial court's order was ineffective to confer appellate jurisdiction over those counterclaims, the judgment, as it relates to the 29 counterclaims seeking damages, is nonfinal and nonreviewable at this time."
*29 Dzwonkowski v. Sonitrol of Mobile, Inc., 892 So.2d 354, 361-62 (Ala.2004).
The trial court's reliance on Norfolk Southern Corp. v. California Union Insurance Co., 859 So.2d 167 (La.Ct.App.2003), was misplaced. For one thing, all of the "numerous environmental sites" involved in that case had "proceeded to trial either separately or in groups of sites located in the same state," with the appeal before the Louisiana Court of Appeals dealing only with judgments concerning the sites in Louisiana. Norfolk Southern Corp., 859 So.2d at 172 n. 4. More importantly, as the Insurers point out in their reply brief, noting their participation as appellants in Norfolk Southern, the appeal was brought pursuant to a provision of the Louisiana Code of Civil Procedure allowing for a "suspension appeal," a procedure foreign to the Alabama Rules of Civil Procedure and the Alabama Rules of Appellate Procedure. As the Insurers explain:
"In 1997, the Louisiana legislature adopted Article 1915 of the Louisiana Code of Civil Procedure. Article 1915 addresses the problem of partial judgments, or judgments on less than an entire claim or less than all parties in a multi-party litigation. Included in Article 1915 is an exclusive list of partial judgments that under Louisiana Law are immediately appealable partial final judgments. One such partial judgment is a judgment on an issue of liability where the liability issue has been tried separately by the court or when in a jury trial, the issue of liability has been tried before a jury and the issue of damages is to be tried before a different jury. Article 1915 allowed [the Insurers] to appeal the legal issues of its liability for coverage to Norfolk Southern notwithstanding the fact that damages at other sites had not yet been determined."
(The Insurers' reply brief, pp. 9-10.)
In its oppositions to the summary-judgment motion the Insurers unsuccessfully filed, Sonat argued, in pertinent part:[3]
"[The Insurers] may not ignore that [Sonat's] pipeline operations, and the PCB remedial activities at its compressor stations, were unitary. It would be inappropriate to view either of the two trial sites individually as opposed to being a part of the unitary system or unitary cleanup. . . .
"The fact that two of the thirteen compressor stations are identified for early trial is one of convenience for judicial administration, and neither an overt or tacit admission that [Sonat's] compressor stations should be treated separately. . . . "
___________________
"The fact that an initial trial is scheduled to focus on only two of the thirteen compressor stations where PCB-related damage [was] found does not somehow alter the unitary nature of [Sonat's] operations, and does not magically transform the legal effect of such unitary operations that the several losses constitute a single occurrence. . . . [Sonat] has always maintained, and still does today, that the operation of its unitary pipeline system constitutes a single occurrence under the [Insurers'] policies. . . .
". . . .
*30 "The policy language and facts of this claim dictate a single occurrence. The unitary nature of the pipeline operation, the single cause of the contamination, the unitary nature of the type and location of contamination at all of the stations and the unitary nature of the remediation support a single occurrence."
As pleaded and presented by Sonat, and as consistently argued by it throughout this litigation, there exists a single claim, expressly predicated on an allegedly "single occurrence," followed by a single denial of coverage by the Insurers, thereby entitling Sonat to obtain declaratory relief and to recover damages for breach of contract. With respect to the PCB contamination at its "integrated operations at compressor stations," Sonat has expressly asserted that there was one continuous exposure over the course of the policy periods to the same PCBs emanating from the same synthetic lubricant. Sonat has emphasized throughout this litigation that it undertook a single project to investigate and remediate the damage it discovered throughout its integrated system of compressor stations. In short, Sonat has asserted the unitary nature of its pipeline operation, including the unitary nature of the type and location of contamination at all of the compressor stations and has expressly asserted in the trial court that its remedial activities at its compressor stations were likewise unitary.
Sonat's action seeks to recover globally for a single occurrence. At the very least, and independent of the interrelationships among the course of events and resulting damage at various other locations along its pipeline system, Sonat's claims for relief seek to "`vindicate one legal right and allege[] several elements of damage'" with respect to claims for declaratory relief and damages relating to the PCB contamination at the Reform, Elmore, Gallion, McConnells, and Tarrant, Alabama, compressor stations. Precision American Corp., 505 So.2d at 381 (quoting 10 C. Wright, A. Miller & M. Kane, Federal Practice and Procedure: Civil 2d, § 2657, at 69-71 (1983)).
Conclusion
Although disposing of the parties' claims and defenses relative to the "availability of insurance coverage" for the Reform and Tarrant sites, the order entered by the trial court following the Phase I trial necessarily "leaves open the question of additional damages" with respect to the other three compressor stations. Accordingly, we need not decide whether there is simply one claim for relief asserted in Sonat's complaint, or whether recognition for some separate claims could be justified, as for example, with respect to mercury contamination at mercury-metering stations as opposed to PCB contamination at compressor stations. All that is necessary to resolve the jurisdictional issue at this stage is that we are clear to the fact that, at a minimum, the identically phrased assertions relating to the events, and resulting damage, at the five compressor stations represents a single claim for relief and that the trial court has not completely disposed of that claim for relief.
Therefore, we are compelled to dismiss this appeal as being from a nonfinal order.
APPEAL DISMISSED.
NABERS, C.J., and SEE, LYONS, WOODALL, STUART, SMITH, BOLIN, and PARKER, JJ., concur.
NOTES
[1] "PCB" is an acronym for polychlorinated biphenyl.
[2] The "Liability Insurance Policies" referred to in the complaint are those "Known Primary, Umbrella and Excess General Liability Insurance Policies Issued to [Sonat,] by Certain Underwriters at Lloyd's" listed in Appendix 1 to Sonat's complaint. The policies there listed cover the period from November 30, 1949, to December 1, 1987.
[3] On January 7, 2005, Sonat filed two documents in opposition to the Insurers' summary-judgment motion; one was entitled "Opposition to Motion for Summary Judgment Regarding Owned Property," and one was entitled "Opposition to Defendants' Motion for Summary Judgment Regarding Number of Occurrences." The quoted material is taken from both documents. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1615809/ | 266 Wis.2d 453 (2003)
2003 WI App 167
668 N.W.2d 736
IN RE the MARRIAGE OF Lynn Danette CURDA-DERICKSON
v.
Richard DuWayne DERICKSON:
SOKAOGON GAMING ENTERPRISE CORPORATION, Appellant,
v.
Lynn Danette CURDA-DERICKSON and Richard Du-Wayne Derickson, Respondents.
No. 02-0924.
Court of Appeals of Wisconsin.
Submitted on briefs November 11, 2002.
Decided July 3, 2003.
*456 On behalf of the appellant, the cause was submitted on the briefs of Andrew S. Caulum of Caulum Law Office, S.C., and of counsel, Michael J. Collins of Collins Law Office, S.C., of Madison.
*457 On behalf of the respondents, the cause was submitted on the brief of J. Thomas McDermott of Steinhilber, Swanson, Mares, Marone & McDermott of Oshkosh.
Before Dykman, Roggensack and Lundsten, JJ.
¶ 1. ROGGENSACK, J.
The Sokaogon Gaming Enterprise Corporation appeals the circuit court's judgment concluding that a restitution order imposed as part of Richard Derickson's criminal conviction for embezzlement during his marriage to Lynn Curda-Derickson is not a marital debt. Because the restitution order was the result of conduct that constituted the tort of conversion, which tort was committed by only one spouse, we affirm the circuit court's conclusion that the restitution order is Richard's sole obligation pursuant to WIS. STAT. § 766.55(2)(cm) (2001-02).[1]
BACKGROUND
¶ 2. Lynn Curda and Richard Derickson were married on February 20, 1988. In 1994, Richard was appointed the tribal planner for the Sokaogon Chippewa Community, a federally recognized American Indian nation. Between October 1995 and July 1997, Richard embezzled more than $370,000 from the Sokaogon Gaming Enterprise Corporation (Sokaogon), a tribally chartered and wholly-owned subsidiary of the Chippewa, by causing checks to be issued in payment of false billing invoices. In January 1998, Richard and Lynn were indicted in federal district court on five counts of conspiracy to commit theft, fraud, interstate transportation of stolen funds and money laundering.
*458 ¶ 3. In May 1998, Richard entered into a plea agreement. He pled guilty to one count of conspiracy to defraud an Indian gaming establishment, contrary to 18 U.S.C. §§ 371 and 1167(b), and one count of money laundering, contrary to 18 U.S.C. § 1956. Richard also agreed to make restitution to the Sokaogon in the amount of $370,796.34 and to forfeit any right, title and interest in real and personal property traceable to funds from the Sokaogon. In a letter dated May 21, 1998, Lynn also agreed to forfeit any right, title and interest in assets purchased with money from the Sokaogon, but excluding parcels of real property located: (1) at E3888 Valley Road, Iola, Wisconsin, (2) at E5777 East Hidde Road, Marion, Wisconsin and (3) in the Town of Mattesor.
¶ 4. On May 26, the district court accepted Richard's plea, and upon the government's motion, dismissed the indictment against Lynn. At the plea hearing, the government submitted a list of assets for forfeiture that were purchased with stolen funds, consisting mainly of farm machinery and cattle. On April 1, the district court entered judgment against Richard, sentenced him according to the plea agreement and issued a restitution order of $370,796.34 to be paid to the Sokaogon. Additionally, the court ordered the turnover of the assets in Lynn and Richard's possession at the farm located on East Hidde Road, for liquidation in partial restitution to the Sokaogon.
¶ 5. In November 2000, Lynn commenced a divorce action. The Sokaogon moved to intervene as a third party claiming an interest in the real and personal *459 marital property to be divided by the court.[2] Specifically, the Sokaogon requested that the court classify the criminal restitution order against Richard as a marital debt. The court granted the Sokaogon's motion to intervene and a bench trial was held on February 18, 2002.
¶ 6. At trial, Lynn testified that she works as an economic support worker for the Waupaca County Department of Health and Human Services. In June 2000, the East Hidde Road property was sold in foreclosure proceedings and Lynn moved to the Valley Road property. She further testified that she did not sell, give or take away any of the assets listed for liquidation and that some were still at the East Hidde Road property when she left.
¶ 7. Additionally, Lynn testified that in February 2001, Richard quitclaimed his interest in the Valley Road property to her, in anticipation of a property division between the parties. Richard and Lynn had purchased the property prior to their marriage and paid off the original mortgage on the property in 1990, before Richard started to work for the Sokaogon. The property is therefore not traceable to his theft. It is currently valued at approximately $10,000 with a $5000 mortgage. There are also several judgment liens against the property, including unpaid real estate taxes, $17,000 due to Jerry's Excavating and the lien created by United States government's restitution order. Prior to the divorce proceeding, Lynn and the United States stipulated that her interest in the Valley Road property, notwithstanding the quitclaim deed, continued to be *460 subject to any legal effects the docketed lien and judgment against Richard may have under applicable law.
¶ 8. Based on Lynn and Richard's testimony, the circuit court granted the divorce and divided the parties' property according to the terms of a marital settlement agreement that the court found to be fair and equitable. Under the settlement agreement, Lynn received her 1995 Ford Aerostar valued at $2200, her retirement plan worth $1937, an annuity valued at $161.50, the Valley Road property subject to its liens and all personal property in her possession. Additionally, Richard was "solely responsible for all debts and obligations of the parties incurred prior to the commencement of this action." Finally, the court denied the Sokaogon's request to classify the restitution order as a martial debt, reasoning that the Sokaogon had failed to demonstrate that Lynn was involved in the embezzlement. Therefore, the court concluded that under Wisconsin's marital property statutes, the Sokaogon's claim was not valid. The Sokaogon appeals.[3]
DISCUSSION
Standard of Review.
[1]
¶ 9. The resolution of this appeal requires us to determine whether a restitution order imposed by a *461 criminal judgment is a marital obligation under WIS. STAT. § 766.55. The construction of a statute and its application to undisputed facts present questions of law that we review without deference to the circuit court. Truttschel v. Martin, 208 Wis. 2d 361, 364-65, 560 N.W.2d 315, 317 (Ct. App. 1997).
Restitution Order.
¶ 10. The Sokaogon argues that the circuit court erred by concluding that the restitution order imposed against Richard was not a marital debt subject to division. The Sokaogon starts with the presumption that all property acquired during the marriage that is not inherited or gifted is subject to division in the divorce proceedings. WIS. STAT. § 767.255. Additionally, the divorce court presumes that the division of the marital estate, comprised of assets and debts, is to be equally allocated between the parties. Id. The Sokaogon then characterizes the restitution order as a type of "negative property" and reasons that because "[s]tolen money is not a gift or an inheritance," the restitution order that requires repayment of stolen money that was acquired during marriage must be presumed to be part of the marital estate. The Sokaogon also contends that Lynn failed to rebut the presumption that all debts incurred during the marriage are marital debts and therefore, the restitution order is a marital debt and subject to division between the parties. In so doing, the Sokaogon attempts to assume the posture of a spouse appealing from a judgment of divorce, rather than a judgment creditor seeking recovery for an obligation incurred by a spouse during the marriage.[4]
*462 [2, 3]
¶ 11. The underlying purpose of this appeal is plain: the Sokaogon wants to recover from Lynn the indebtedness created by the restitution order and seeks the court's ruling that the order is a "marital debt" under WIS. STAT. § 767.255, towards this end. It is true that WIS. STAT. ch. 767 sets out a framework for the division of assets and debts upon dissolution of marriage. Kuhlman v. Kuhlman, 146 Wis. 2d 588, 590, 432 N.W.2d 295, 296 (Ct. App. 1988). However, a creditor's satisfaction rights for an obligation incurred by a spouse during the marriage turns on the nature of the obligation under WIS. STAT. § 766.55 of the Wisconsin Marital Property Act. See St. Mary's Hosp. Med. Ctr. v. Brody, 186 Wis. 2d 100, 103, 519 N.W.2d 706, 708 (Ct. App. 1994). Stated in practical terms, the Sokaogon's right to reach Lynn's property to satisfy the restitution order is not determined by § 767.255; rather, it is driven solely by the classification into which the obligation falls under § 766.55. Id.; Bank One v. Reynolds, 176 Wis. 2d 218, 221, 500 N.W.2d 337, 338 (Ct. App. 1993). The Sokaogon's reliance on § 767.255 is therefore misplaced.
¶ 12. We begin our analysis with an examination of WIS. STAT. § 766.55 that establishes classifications of obligations, marital and individual, with which spouses *463 may be involved, and clarifies what property is available to satisfy obligations of differing classes. Section 766.55 provides in relevant part:
(1) An obligation incurred by a spouse during marriage, including one attributable to an act or omission during marriage, is presumed to be incurred in the interest of the marriage or the family. ...
(2) After the determination date all of the following apply:
(a) A spouse's obligation to satisfy a duty of support owed to the other spouse or to a child or the marriage may be satisfied only from all marital property and all other property of the obligated spouse.
(b) An obligation incurred by a spouse in the interest of the marriage or the family may be satisfied only from all marital property and all other property of the incurring spouse.
. . .
(cm) An obligation incurred by a spouse during marriage, resulting from a tort committed by the spouse during marriage, may be satisfied from the property of that spouse that is not marital property and from the spouse's interest in marital property.
(d) Any other obligation incurred by a spouse during marriage, including one attributable to an act or omission during marriage, may be satisfied only from property of that spouse that is not marital property and from that spouse's interest in marital property, in that order.
¶ 13. The Sokaogon argues that the stolen funds benefited the marital estate and the restitution order was therefore incurred as a marital debt. Although it casts the argument in ch. 767 "property division" language, *464 we understand it to argue that the restitution order was incurred "in the interest of the marriage or the family," under WIS. STAT. § 766.55(2)(b). An obligation under the "family purpose" category may be satisfied from all marital property and all other property of the incurring spouse. Additionally, in dissolution, the court may assign an obligation incurred in the interest of the family to the "nonincurring" spouse and "the obligation may be satisfied as if both spouses had incurred the obligation." WIS. STAT. § 766.55(2m). In practical terms, a subsec. (2)(b) classification of the debt may allow the Sokaogon to attach the nonincurring spouse's wages to satisfy the restitution order after dissolution of the marriage.
¶ 14. In contrast, Lynn argues that the restitution order is an obligation "resulting from a tort committed by the spouse during marriage," and therefore falls within the purview of WIS. STAT. § 766.55(2)(cm). She reasons that the conduct that gave rise to Richard's criminal conviction would constitute the civil tort of conversion and therefore, the restitution order resulted from a tort committed by Richard during the marriage. She contends that the circuit court properly rejected the Sokaogon's request to hold her responsible for the obligation after divorce. Because the statutory classification of the restitution order determines whether it is a marital or an individual obligation, the resolution of this appeal turns on whether the restitution order was an obligation incurred "in the interest of the marriage or the family," or whether it resulted "from a tort committed by the spouse during marriage." See §§ 766.55(2)(b) and (2)(cm).
¶ 15. WISCONSIN STAT. § 766.55 contains no clear provision for obligations arising from an order for restitution, but we conclude it may be classified as are *465 other obligations incurred during marriage. Accordingly, we start with the statutory presumption that obligations incurred by a spouse during marriage are "incurred in the interest of the marriage or the family." Section 766.55(1). It is not disputed that Richard incurred the restitution order during his marriage to Lynn. However, the legislature carved out statutory exceptions to the presumption, denominated as individual obligations because they may be satisfied only from that spouse's individual property and from that spouse's interest in marital property. See § 766.55(2)(cm). The nonincurring spouse, in this case Lynn, may therefore overcome the "family purpose" presumption by proving that the incurred obligation falls within the statutory exception for torts. See Schmidt v. Waukesha State Bank, 204 Wis. 2d 426, 442-43, 555 N.W.2d 655, 661-62 (Ct. App. 1996). To determine whether Lynn satisfied this burden, we must first examine the scope of § 766.55(2)(cm).
¶ 16. WISCONSIN STAT. § 766.55(2)(cm) protects an innocent spouse from personal liability for torts committed by the other spouse during marriage. Bothe v. American Family Ins. Co., 159 Wis. 2d 378, 382, 464 N.W.2d 109, 110 (Ct. App. 1990). We previously held that the statute is not ambiguous and plainly provides that satisfaction of a tort obligation may be made only from (1) property of the tortfeasor spouse that is not marital property, and (2) the tortfeasor spouse's interest in marital property. Id.; see also Schultz v. Sykes, 2001 WI App 260, 248 Wis. 2d 791, 638 N.W.2d 76, review denied, 2002 WI 23, 250 Wis. 2d 557, 643 N.W.2d 94 (Wis. Jan. 29, 2002), cert. denied, 536 U.S. 960 (June 28, 2002) (holding that during marriage, a judgment creditor may garnish the tortfeasor's interest in the innocent spouse's wages). The issue here is whether a restitution *466 order imposed by a criminal judgment is an obligation "resulting from a tort committed by the spouse" under § 766.55(2)(cm) (emphasis added).
[4-11]
¶ 17. The purpose of all statutory construction is to discern the intent of the legislature. State v. Setagord, 211 Wis. 2d 397, 406, 565 N.W.2d 506, 509 (1997). We give the language of an unambiguous statute its ordinary meaning. Id. Applying this test to WIS. STAT. § 766.55(2)(cm), we conclude that the underlying determination of whether an obligation resulted from a "tort" requires examination of the spouse's conduct that gave rise to the claim made. A tort is a wrongful act for which a civil remedy may be obtained. See BLACK'S LAW DICTIONARY 1496 (1994). We begin by noting that an individual's conduct may constitute a tort without a civil judgment so concluding. See WEBSTER'S NEW COLLEGIATE DICTIONARY 1232 (1977) (defining "tort" as "a wrongful act for which a civil action will lie ..." (emphasis added)). Additionally, the same act may be both a crime because it violates a state law and a civil tort against an individual. PROSSER AND KEETON ON TORTS § 2, at 8 (W. Page Keeton et al. eds., Lawyers ed. 1984). Furthermore, there is nothing in the language of the statute to suggest that its purpose is to protect innocent spouses from liability only for obligations incurred as a result of a civil tort action. Instead, the statute shields an innocent spouse from some of the consequences of the other spouse's wrongful conduct. Accordingly, we conclude that § 766.55(2)(cm) classifies obligations resulting from a spouse's wrongful act during the marriage as an obligation for which only the tortfeasor spouse is personally liable.
*467 [12, 13]
¶ 18. Applying WIS. STAT. § 766.55(2)(cm) to the facts here, we note first that whether a spouse committed the act for which a civil remedy may be obtained presents a question of fact that is not disputed on appeal. At trial, the circuit court found that Richard committed a "horrendous property crime that continued on over many, many years" by repeatedly taking money from the Sokaogon without their permission. That conduct, for civil purposes, constitutes the tort of conversion. See Schara v. Thiede, 58 Wis. 2d 489, 497, 206 N.W.2d 129, 133 (1973). Additionally, the court found that Lynn "had no active part in the taking of this money" and that the restitution order "is totally one hundred per cent incurred and the responsibility" of Richard. The Sokaogon does not contest the court's findings or Lynn's assertion that the restitution order resulted from a tort committed solely by Richard during the marriage. A proposition asserted by a respondent on appeal and not disputed by the appellant's reply is taken as admitted. Schlieper v. DNR, 188 Wis. 2d 318, 322, 525 N.W.2d 99, 101 (Ct. App. 1994). Accordingly, for the reasons stated above, we conclude that the circuit court properly classified the restitution order as Richard's individual obligation, according to the provisions of § 766.55(2)(cm).
¶ 19. To refute this conclusion, the Sokaogon argues, on policy grounds, that where a marital estate benefits from a tort committed by a spouse during the marriage, the subsequent restitution order should be a marital debt. The Sokaogon contends that "the State of Wisconsin [should not] shelter their marital estate from financial responsibility to the very members of the public they injured." The Sokaogon relies on Cadwell v. Cadwell, 126 Ariz. 460, 616 P.2d 920 (Ct. App. 1980) and *468 Bell v. Bell, 49 Cal. App. 4th 300, 56 Cal. Rptr. 2d 623 (Ct. App. 1996), for the proposition that if liability of the married person is based on an act preformed for the benefit of the community, it should be satisfied from the community estate. In short, the Sokaogon asks us to apply a "family purpose analysis" to obligations arising from a tort committed by a spouse. See WIS. STAT. § 766.55(2)(b). We decline to do so.
[14]
¶ 20. The original Wisconsin Marital Property Act contained no separate category for tort obligations. KEITH A. CHRISTIANSEN ET. AL., MARITAL PROPERTY LAW IN WISCONSIN § 6.5 (2nd ed. 1986). Torts were included in the general satisfaction scheme of WIS. STAT. § 766.55(2) that required an analysis of whether the tort was committed in the interest of the marriage or the family. Id. Section 766.55(2)(cm) was added by the 1985 Trailer Bill and by its terms, removes the necessity of a family purpose analysis for torts committed during the marriage. Id. Therefore, debts created by the torts of only one spouse are an exception from those debts incurred in the interest of the family. Accordingly, we decline the Sokaogon's invitation to "re-insert" a family purpose analysis into tort obligations, and we affirm the judgment of the circuit court.[5]
*469 CONCLUSION
¶ 21. Because the restitution order was the result of conduct that constituted the tort of conversion, which tort was committed by only one spouse, we affirm the circuit court's conclusion that the restitution order was Richard's sole obligation under WIS. STAT. § 766.55(2)(cm).
By the Court.Judgment affirmed.
NOTES
[1] All further references to the Wisconsin Statutes are to the 2001-02 version unless otherwise noted.
[2] The United States also intervened as a third party in the Derickson's divorce action but did not participate in the trial or this appeal.
[3] On appeal, Lynn moved to strike from the Sokaogon's reply brief an article from The Philadelphia Daily News and a criminal complaint from United States v. Fastow. Because the material was included to provide background for an argument grounded in public policy that has no bearing on our analysis regarding whether the restitution order is a marital obligation under WIS. STAT. § 766.55, we deny Lynn's motion to strike that portion of the reply brief.
[4] The procedural posture of this case is unusual because, in the Sokaogon's words, it "appeals only the trial court's finding that the ... restitution order is not a marital debt." Therefore, the case differs from a usual creditor's action against a spouse to reach his or her property to satisfy a debt, for example, a creditor's action to garnish a spouse's wages pursuant to WIS. STAT. § 803.045. However, because the Sokaogon "became a creditor as a direct result of the criminal acts of Richard," our analysis is driven by the rules regarding debtors' and creditors' rights and remedies. See WIS. STAT. § 766.55.
[5] We note that this decision does not preclude an action in rem by a creditor to realize on a lien on property that was part of the marital estate. For example, if the government should choose to foreclose on its lien for the restitution order that is an encumbrance on the Valley Road property, it could do so. However, Lynn would not be personally liable if the price obtained for the property was insufficient to satisfy the lien. Similarly, this decision does not address whether WIS. STAT. § 766.55(2)(cm) protects the property of an innocent spouse where a marital property division granting property to the innocent spouse is entered prior to the resolution of a criminal or tort action against the other spouse and the property awarded to the innocent spouse was acquired in whole or in part with money obtained by the tortious act of the other spouse. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1614780/ | 23 So.3d 716 (2009)
SHABTAI
v.
STATE.
No. 1D09-4465.
District Court of Appeal of Florida, First District.
December 15, 2009.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1919991/ | 91 B.R. 428 (1988)
In re Paul R. PRETZER, Debtor.
Bankruptcy No. B88-2195.
United States Bankruptcy Court, N.D. Ohio, E.D.
September 19, 1988.
Glenn R. Schmitt, Thompson, Hine & Flory, Cleveland, Ohio, for debtor.
*429 Kenneth J. Nordstrom, Nordstrom & Locke, Ashland, Ohio, for Production Credit Assoc.
MEMORANDUM OF OPINION AND ORDER
RANDOLPH BAXTER, Bankruptcy Judge.
In this Chapter 12 case, Production Credit Association (PCA), a secured creditor, seeks adequate protection from Paul R. Pretzer (Debtor) for use of its cash collateral. Pursuant to requirements of Rule 7052, Bankr. Rules, the following constitutes the Court's findings and conclusions.
This is a core proceeding under provisions of 28 U.S.C. § 157(b)(2), with jurisdiction further conferred under 28 U.S.C. § 1334 and General Order No. 84 of this District. From a loan made by PCA to the Debtor, a balance remains in an amount of $224,032.53. The loan was collateralized, in part, by a security interest in certain greenhouse vegetable crops grown by the Debtor. The security interest was duly recorded. Contending that the Debtor is selling or otherwise consuming its collateral without providing adequate protection thereon, PCA states that § 1205 of the Code allows it to receive adequate protection payments from the Debtor for the use or sale of its cash collateral. PCA further contends that an additional or replacement crop lien on future greenhouse crops would not constitute adequate protection as there is no guarantee that such crops would be grown, marketed or that the Debtor would continue in business. For those reasons, PCA seeks an order requiring the Debtor to pay a minimum of $1,500.00 monthly for the Debtor's use, sale and consumption of its cash collateral.
In opposition to PCA's request for additional payments as adequate protection, the Debtor represents that an earlier order of this Court allowing it to use cash collateral and granting PCA a postpetition replacement lien respecting the subject collateral affords adequate protection to PCA and that further payments are unwarranted. Debtor further contends that the value of PCA's collateral is unimpaired.
Adequate protection in Chapter 12 cases is addressed in § 1205. In pertinent part, § 1205 of the Code provides:
§ 1205. Adequate Protection.
(a) Section 361 does not apply in a case under this chapter.
(b) In a case under this chapter, when adequate protection is required under section 362, 363, or 364 such adequate protection may be provided by
(1) requiring the trustee to make a cash payment or periodic cash payments to such entity, to the extent that the stay under section 362 use, sale, or lease under section 363 results in a decrease in the value of property securing a claim or of an entity's ownership interest in property;
(2) providing to such entity an additional or replacement lien to the extent that such stay, use, sale, lease, or grant results in a decrease in the value of property securing a claim or of an entity's ownership interest in property. . . . § 105(a) and (b)(1), (2).
Construing the language of § 1205 to the present matter, no valuation data has been presented to evidence a decrease in the value of property securing a claim. Although § 1205(b)(1) requires the debtor to make a cash payment or periodic cash payments where there has occurred a decrease in the value of property securing a claim or of an entity's ownership interest in property, no specific evidence has been adduced to indicate that the Debtor is undercollaterized respecting the subject secured property or that the value of the collateral has decreased.[1] Section 1205(b)(2) allows adequate protection to be provided in the form of an additional or replacement lien where a decrease in the value of property securing a claim or an entity's ownership interest has occurred. In an order authorizing use of PCA's cash collateral, PCA was granted a postpetition lien on the subject collateral. The collateralized property covered *430 by the replacement lien is inclusive of "all greenhouse crops, including but not limited to tomatoes and lettuce."
The Debtor argues that there are minimal risks to PCA's collateral due to the Debtor's cultivation of its crops in a greenhouse environment. PCA argues that the replacement lien is not adequate protection since there is no guarantee that future crops will be grown, and that § 1205 mandates adequate protection for use of its cash collateral.
The legislative history to § 1205 states that "No debtor may use cash collateral unless the secured creditor consents, or the court, after notice and a hearing, authorizes such use." It further explains that under § 1205, (1) the § 361 requirements for adequate protection are not applicable in Chapter 12 cases; (2) the requirement for payment of lost opportunity costs is eliminated; and (3) the "indubitable equivalent" language of § 361(3) has been eliminated. HR Conf.Rep. No. 99-958, 99th Cong. 2nd Sess. 49-50 (1986), U.S.Code Cong. & Admin.News 1986, p. 5227. What is to be protected is the value of the property, not the value of the creditor's interest in the property. Id.
The testimony reveals that the Debtor is currently growing a greater volume of crops than he had grown prepetition. There presently is no insurance coverage on the collateralized growing crops. The Debtor testified that no insurance is presently available on growing crops, but upon inquiry of the Court, further testified that no extensive efforts had been made to see if insurance companies provided the coverage. As the above-referenced legislative history of § 1205 reveals, it is the value of the property which must be adequately protected and not the value of the creditor's interest therein. Without insurance coverage on the growing crops the value thereof is not adequately protected. Although a greenhouse environment does minimize certain potential risks to growing crops, it does not provide sufficient protection to constitute the level of adequate protection envisioned by the § 1205 of the Code.
Accordingly, adequate insurance coverage on the growing crops is required and the Debtor has 15 days from the date of this ruling to provide evidence of adequate coverage thereon to PCA with certification to the Court, or provide evidence that Debtor has made his best efforts to obtain insurance and that such insurance is not available.
Periodic payments for adequate protection are to be made under § 1205(b)(1) only where there is evidence of a decrease in value of the subject property. No such decrease in value has been shown, and periodic cash payments will not be required.
IT IS SO ORDERED.
NOTES
[1] Indeed, the Debtor testified that he has now planted twice as many crops with a present value that is ten to fifteen percent higher than at time of filing. This testimony was unrefuted. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920032/ | 91 B.R. 463 (1988)
In re SOUTHERN INDUSTRIAL BANKING CORPORATION, Debtor.
Thomas E. DUVOISIN, Liquidating Trustee, Plaintiff,
v.
Gerhard BUCHER and Jean Bucher, Defendants.
Bankruptcy No. 3-83-00372, Adv. No. 3-84-0344.
United States Bankruptcy Court, E.D. Tennessee.
September 20, 1988.
John A. Lucas, Jeffrey S. Norwood, Hunton & Williams, Knoxville, Tenn., for plaintiff.
Dexter A. Christenberry, Knoxville, Tenn., for defendants.
FINDINGS OF FACT AND CONCLUSIONS OF LAW
GEORGE C. PAINE, II, Chief Judge.
The following constitutes findings of fact and conclusions of law pursuant to Bankruptcy Rule 7052. This is a core proceeding. 28 U.S.C. Section 157(b)(2)(A).
A. Procedural History
This proceeding was commenced by the filing of a complaint by the Trustee to recover certain transfers by the Debtor to the defendants as preferential under 11 U.S.C. Section 547(b). On June 30, 1988, the Court entered a judgment in favor of the Liquidating Trustee and against the defendants granting the plaintiff's motion for summary judgment and his motion to dismiss the "Counter-Complaint" filed by the defendants. The Judgment avoided as preferential the transfers to the defendants *464 and entered judgment against them, jointly and severally, in the amount of $9,649.09, plus costs and prejudgment interest.
On July 1, 1988, the defendants filed a "Motion for New Trial" (the "Motion"). On July 8, 1988, the plaintiff moved to strike this pleading and for sanctions pursuant to Federal Bankruptcy Rule 9011 and 28 U.S.C. § 1927 against defendants or their counsel on the grounds that the Motion contained redundant, immaterial and impertinent matters and attempted to raise matters that have been previously rejected or decided by this Court. In addition, the pleading, signed by counsel, contained statements of law and fact that have no foundation.
A complete recitation of the defects and inaccuracies in the Motion is not necessary. A brief summary of some of the more egregious ones is sufficient:
1. The Debtor's fraud as a defense to these preference actions has previously been considered and rejected by this Court. See Order and Memorandum entered in Consolidated Adversary Proceedings, September 26, 1988 (J. Bare).
2. The Motion states that the Court "erred in sustaining Chapter 11 since the creditors would have gotten much more money under Chapter 7. . . ." No factual basis for this assertion is proffered. Of course, the Court previously determined the opposite to be true in confirming the Modified Plan. See Order Nos. 73 and 93 entered November 28, 1983 and January 24, 1984, respectively (J. Bare). In addition, the Court previously determined that the Debtor was insolvent by at least $11,638,028 throughout the Preference Period. See DuVoisin v. Anderson, et al. (In re SIBC), 71 B.R. 351, 375 (Bankr.E.D.Tenn. 1987). Mr. Christenberry's assertion, consequently, is incredible. Even if true, no explanation is given as to why this constitutes a basis for a new trial.
3. No factual basis is suggested for the notions that the creditors' committee was "appointed by insiders" or that it was "controlled by the Butchers". No explanation is given as to why these constitute a basis for a new trial.
4. The suggestion that the Court violated 11 U.S.C. § 1129(a)(10) by confirming the Modified Plan in the absence of an acceptance by at least one impaired class is not supported by any proffered factual basis. In fact, the record in this bankruptcy case shows that the Modified Plan was accepted by at least one impaired class. No explanation is given as to why this unfounded allegation even if true constitutes a basis for a new trial.
On July 25, 1988, the Court entered an Order denying Mr. Christenberry's motion for a new trial because "there is no basis whatsoever to grant it. All issues raised in the motion have either been dealt with in prior orders of the court or are nonsensical."
On August 4, 1988, the Court served written notice on counsel for all parties that the plaintiff's Motion to Strike and for Sanctions would be heard on August 16, 1988, at 1:30 p.m., Room 216, Customs House, 701 Broadway, Nashville, Tennessee.
Defendants' counsel failed to appear at the hearing. Mr. Christenberry also failed to respond to plaintiff's Motion for Sanctions, despite ample opportunity to do so. Because Mr. Christenberry chose not to appear at the hearing, the Court exercised its discretion to decide the motion based upon the briefs, the plaintiff's counsel's argument, the motion to strike and the record in this proceeding as a whole, and granted sanctions against defendants' counsel.
At the hearing, the Court was presented with a pleading captioned "Notice of Attorney Dismissal" filed by Mr. Christenberry. This "Notice" was served upon plaintiff's counsel shortly before the hearing but was not contained in the Court's file. The Notice states as follows:
Comes Dexter A. Christenberry, Attorney, and announces that he has been dismissed by defendants in this cause. He has been advised by his former clients that they are in contact with plaintiff attempting a settlement of this matter.
*465 The Motion set for August 16, 1988 is hereby withdrawn.
/s/ Dexter A. Christenberry
Mr. Christenberry failed to follow the Court's procedure for withdrawing as counsel. To the extent that the Notice is intended by Mr. Christenberry as a Motion requesting permission to withdraw, it is denied. Obviously, Mr. Christenberry is without authority to withdraw a motion for sanctions filed against him or to cancel a hearing noticed by the Court.
B. Bankruptcy Rule 9011
Bankruptcy Rule 9011 is patterned after Rule 11, Fed.R.Civ.P., which was amended in 1983. The Rule imposes an affirmative duty on an attorney to conduct a reasonable investigation of the law and facts prior to signing a pleading. In In re Ligon, 50 B.R. 127, 132 (Bankr.M.D.Tenn.1985), this Court noted that the 1983 amendments replaced the original subjective requirement that an attorney sign a pleading in good faith with a more stringent requirement. There must be objective reasonableness under the circumstances rather than an attorney's certification that there are good grounds to support the pleading. See INVST Financial Group, Inc. v. Chem-Nuclear Systems, Inc., 815 F.2d 391, 401 (6th Cir.1987).
The Advisory Committee Notes indicate some factors to consider in determining what constitutes reasonable inquiry. 1983 Amendments to Fed.R.Civ.P., 97 F.R.D. 165, 199. These include (1) how much time for investigation was available to the signer, (2) whether he had to rely on a client for information as to the facts underlying the pleading, (3) whether the pleading was based on a plausible view of the law, or (4) whether he depended on forwarding counsel or another member of the bar.
None of these factors benefit Mr. Christenberry as to the reasonableness of his inquiry given the circumstances of the case. INVST Financial Group, Inc. v. Chem-Nuclear Systems, 815 F.2d at 401. Mr. Christenberry had ample opportunity for investigation, he did not have to rely on information from his clients, his pleading was not based on a plausible view of the law and, in fact, was directly in conflict with prior rulings in this case, and he did not depend on other attorneys.
The Motion's patent misstatements of fact and law and its attempted re-argument of defenses already ruled upon by the Court are precisely the sort of conduct that Rule 11 is designed to reach. In this case, neither the factual allegations nor the legal theories are well founded. The pleading clearly violates the strictures of Rule 11. The imposition of sanctions therefore is both appropriate and mandatory. See Albright v. Upjohn Co., 788 F.2d 1217, 1222 (6th Cir.1986) (Trial courts have a mandatory, non-discretionary duty to impose sanctions under Rule 11 where pleadings are not "well grounded in fact."). The imposition of sanctions is part of the Court's responsibility for securing the system's effective operation. 1983 Amendments to Fed.R.Civ.P., 97 F.R.D. 165, 200. Finally, the election of the type of sanctions to be imposed is within the Court's discretion. Albright v. Upjohn Co., 788 F.2d at 1222.
C. 28 U.S.C. § 1927
Plaintiff's motion for sanctions is also based upon 28 U.S.C. § 1927 which provides as follows:
Any attorney or other person admitted to conduct cases in any court of the United States or any Territory thereof who so multiples the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorney's fees reasonably incurred because of such conduct.
Section 1927 is a compliment to the Court's power under Rule 11 and provides an additional basis for imposing sanctions against Mr. Christenberry in this proceeding.
This Court has repeatedly rejected Mr. Christenberry's efforts to re-open the question of whether the Debtor's fraud constitutes a defense to these preference actions. Such attempted relitigation of issues is precisely the sort of conduct proscribed by § 1927. The court's decision in McLaughlin v. Bradlee, 602 F.Supp. 1412 (D.D.C. 1985) is instructive. In that case, a pro se plaintiff continued to pursue claims and *466 legal issues previously rejected by the court. The trial court warned against this but reserved ruling on sanctions.[1] When faced with four frivolous post-trial motions, the court imposed sanctions. The court's language is also applicable here:
The defendants first moved for sanctions against McLaughlin because McLaughlin was attempting to relitigate matters already adjudicated. It is especially appropriate to impose sanctions in situations where the doctrines of res judicata and collateral estoppel plainly preclude relitigation of this suit. The imposition of sanctions is one of the few options available to a court to deter and punish people who relitigate cases hopelessly foreclosed.
Id. at 1417.
The Sixth Circuit's opinion in Jones v. Continental Corp., 789 F.2d 1225 (6th Cir. 1986), also demonstrates that sanctions under 28 U.S.C. § 1927 are appropriate here. There the court cited with approval the Seventh Circuit's opinion in Knorr Brake Corp. v. Harbil, Inc., 738 F.2d 223 (7th Cir.1984), where the Court held that sanctions could be awarded under § 1927 "when an attorney, though not guilty of conscious impropriety, `intentionally . . . [pursues] a claim that lacks plausible legal or factual basis.'" 738 F.2d at 226-27. The Sixth Circuit noted that in Knorr the Seventh Circuit had "accurately discerned the meaning of § 1927" and further held:
28 U.S.C. § 1927 authorizes a court to assess fees against an attorney for `unreasonable and vexatious' multiplication of litigation despite the absence of any conscious impropriety. An attorney's ethical obligation of zealous advocacy on behalf of his or her client do not amount to carte blanche to burden the federal courts by pursuing claims that are frivolous on the merits, or by pursuing non-frivolous claims through the use of multiplicative litigation tactics that are harassing, dilatory, or otherwise `unreasonable and vexatious.'
Accordingly, at least when an attorney knows or reasonably should know that a claim pursuit is frivolous, or that his or her litigation tactics will needlessly obstruct the litigation of non-frivolous claims, a trial court does not err by assessing fees attributable to such actions against the attorney.
789 F.2d at 1230.
The present motion goes beyond "zealous advocacy." It is both multiplicative and vexatious. Many statements in it are totally nonsensical. Sanctions are therefore appropriate under § 1927.
D. Conclusion
It is unacceptable for the Liquidation Trust to have to expend its beneficiaries' funds for legal fees and expenses to respond to such a frivolous motion. The Court must be especially vigilant in a case such as this with literally hundreds of adversary proceedings and the real threat posed to the estate's assets from such multiplicative and harassing litigation tactics. The cost of responding to this Motion therefore should be borne by Mr. Christenberry, not by the Liquidating Trustee.
The Liquidating Trustee's counsel has submitted an Affidavit which details the time and expenses incurred in responding to the Motion, attending the hearing and preparing the proposed findings of fact and conclusions of law requested by the Court.[2] Mr. Norwood's Affidavit reflects that Hunton & Williams expended a total of 30.5 hours at the hourly rates of $150.00 for John A. Lucas and $110.00 for Jeffrey S. Norwood as a consequence of Mr. Christenberry's Motion for a New Trial. In addition, Hunton & Williams incurred travel expenses in the amount of $90.95. The Court finds that the hours expended and *467 expenses incurred were reasonably necessary. The Court further finds that the hourly rates are reasonable. INVST Financial Group v. Chem-Nuclear, Inc., 815 F.2d at 405. Accordingly, the Liquidating Trustee is entitled to a judgment for compensatory damages of $3,585.95.
The Court further finds that the Motion, for the reasons stated above, is so frivolous that it is appropriate to impose punitive damages against Mr. Christenberry in addition to the compensatory damages discussed above. In this case, punitive damages are appropriate and necessary to fulfill the twin goals of Rule 11 "which are the deterrence and punishment of offenders and the compensation of their opponents for expenditure of time and resources responding to unreasonable pleadings or motions. INVST Financial Group, Inc. v. Chem-Nuclear Systems, Inc., 815 F.2d at 404. Mr. Christenberry has unnecessarily multiplied these proceedings by attempting to re-litigate issues previously decided adverse to the defendants. Even a cursory review of the Court's opinions in these consolidated adversary proceedings would have revealed these controlling precedents. Accordingly, the Liquidating Trustee is entitled to an award of punitive damages of $2,000.00.
NOTES
[1] In a related adversary proceeding, DuVoisin v. Kirkland (Adversary Proceeding No. 3-85-0103) Mr. Christenberry also attempted to raise the same defense again. Judge Bare granted the Plaintiff's motion to strike in that proceeding, while reserving ruling on his motion for sanctions. See Order entered April 7, 1987, in that adversary proceeding. This Court has now granted the Plaintiff's request for sanctions against Mr. Christenberry in the Kirkland adversary proceeding. See Memorandum and Order entered Sept. 20, 1988, in 91 B.R. 467.
[2] The Affidavit also details the time and expenses incurred in responding to Mr. Christenberry's Motion for Summary Judgment in the Kirkland case, Adversary Proceeding No. 3-84-0103. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1920040/ | 91 B.R. 445 (1988)
In re Robert L. BLOOM and Alison G. Bloom, Debtors.
Bankruptcy No. B88-1716.
United States Bankruptcy Court, N.D. Ohio, E.D.
October 11, 1988.
Sheldon Stein, Cleveland, Ohio, for debtors.
Diana M. Thimmig, Arter & Hadden, Cleveland, Ohio, trustee.
MEMORANDUM OF OPINION AND ORDER
RANDOLPH BAXTER, Bankruptcy Judge.
This matter is before the Court upon the Trustee's motion for a turnover of funds. Following a hearing with notice thereof to all entitled parties, the Court has reviewed the pleadings and other relevant portions of the record. Pursuant to Rule 7052, the following constitutes the Court's findings:
I.
This is a core proceeding under provisions of 28 U.S.C. 157(b)(2), with jurisdiction further conferred under 28 U.S.C. 1334 and General Order No. 84 of this District. Herein, the Trustee seeks a turnover of funds. On the petition date the Debtors had an estimated $10,291.60 on deposit in an IRA account. Additionally, the Debtors had another $326.92 in two separate bank accounts. Further, they were entitled to a federal tax refund exemption in an amount of $1,221.00, for a total of $11,809.52. Initially allowing for the Debtor's statutory exemptions, the Trustee sought a nonexempt recovery of $10,209.52. Consequent to the turnover motion, the Trustee filed an objection to the Debtors' claim for exemptions.
On the Debtors' Schedule B-4, an exemption for all funds held in their IRA account is claimed. Contending that the Debtors have provided no documentation in support of their claimed exemption, the Trustee objects to an exemption allowance. This motion ensued.
II.
The dispositive issues are two-fold: (1) Whether a debtor is entitled to claim as exempt property funds on deposit in an individual retirement account (IRA); and (2) Whether the "reasonably necessary" language of § 2329.66(A)(10)(c) of the Ohio Revised Code violates the equal protection clause of the United States Constitution.
In support of her motion for turnover, the Trustee contends that the Debtors are currently able to earn income which is sufficient to meet their basic needs and, for that reason, the IRA funds are unnecessary to meet those obligations and should be classified as nonexempt property. To support that contention, the Trustee avers that the Debtors: (1) have a combined net monthly income of $1,714.92; (2) earned approximately $26,000.00 during the 1987 tax year, according to their statement of *446 financial affairs, but their 1987 federal tax return reflects combined earned income in an amount in excess of $34,000.00; (3) are both gainfully employed; (4) received interest income and dividend income totalling in excess of $2,200.00 during 1987; (5) have maintained their employment as a machine operator and as a payroll clerk, respectively; (6) under their current income, have been able to maintain their lifestyle in a fashion which was higher than that necessary for maintenance and/or support; (7) have funds in an IRA account owned by co-debtor Robert Lee Bloom totalling $10,291.60; (8) have additional accounts, including but not limited to a joint checking account, a savings account, a credit union share account, and two mutual fund accounts; (9) own a gun collection valued in excess of $3,000.00; (10) own thirty (30) shares of stock in Chemical New York; (11) reside in a personal residence which is fair market valued at $70,000.00, and own two automobiles, a 1980 Buick Skylark and a 1982 Buick Regal. Further, the Trustee states that the subject IRA account was established in 1983, without disbursement restrictions, and at no time have the Debtors disturbed the corpus of the account. For these reasons, the Trustee strongly urges that the IRA funds be deemed as nonexempt assets since they obviously are not necessary for the support of the Debtors or of their dependent.
In opposition to the Trustee's motion for turnover of funds, the Debtors differ regarding the Trustee's status report on certain of their assets. They admit that both co-debtors are employed but contend that the Trustee has overstated their net monthly income. They contend that their respective net weekly incomes are $224.43 and $221.02.[1] They further assert that although their personal residence is valued at approximately $70,000.00, it is subject to a mortgage of equal amount, requiring monthly payments thereon of $645.00. Additionally, they state that of the two automobiles, one has been returned to a secured creditor during the course of their estate's administration. They further represent that the balance of their nonexempt assets, including a coin collection, thirty (30) shares of Chemical New York stock, and funds in excess of exemption limitations are in the process of being voluntarily turned over to the Trustee for administration.
III.
In order to maintain a motion for turnover, the burden of proof is upon the party seeking the turnover. That burden must be carried by clear and convincing evidence. Maggio v. Zeitz, 333 U.S. 56, 68 S.Ct. 401, 92 L.Ed. 476 (1948). As the State of Ohio has elected to opt out of the federal exemption scheme provided under § 522 of the Bankruptcy Code, [11 U.S.C. 522], an examination of Ohio's exemption statute is required. In pertinent part, Ohio Revised Code § 2329.66(A)(10)(c) provides:
(c) Except for any portion of the assets that were deposited for the purpose of evading payment of any debt, the person's right in the assets held in, or to receive any payment thereunder, any individual retirement account, individual retirement annuity, or Keogh or "H.R. 10" plan that provides benefits by reason of illness, disability, death, or age, to the extent reasonably necessary for the support of the person and any of his dependents. Ohio Revised Code § 2329.66(A)(10)(c).
The above statutory provision was revised in 1984. There exists no Ohio case law interpreting this relatively new exemption for IRA's or interpreting the statute's legislative history. A resolution of the initial issue calls for the Court to determine whether, in view of the statutory requirements of § 2329.66(A)(10)(c), the IRA funds on deposit are reasonably necessary for the Debtors to maintain their basic needs.
An examination of the pleadings and the record, generally, reveals that the subject IRA account was established in 1983. It is undisputed that the Debtors have not disturbed the amounts on deposit. It is undisputed *447 that both Debtors are currently employed. Their 1987 tax return reflects combined earnings in excess of $34,000.00. Co-debtor, Robert Bloom, is employed as a machine operator at Marshallan Industries, Inc., while his spouse, co-debtor Alison Bloom, is employed as a payroll clerk with Martien Electric, Inc. In addition to their earned income, they have a modest amount of passive income from interest and dividends. The proceeds on deposit in their IRA account reportedly total $10,291.60. That amount is undisputed. The Debtors' representation that they are in the process of voluntarily turning over certain non-exempt assets to the Trustee which include a coin collection, thirty shares of Chemical New York stock, and other funds in excess of the exemption limitation, is of record.
Federal exemptions available to a debtor in a "non-opting out" state are provided under provisions of § 522 of the Bankruptcy Code. As the "reasonably necessary" standard is applied to the particulars of this case, it is significant to note that the language of Ohio Revised Code § 2329.66(A)(10)(c) is, in part, mirrored from the exemption language of § 522(d)(10)(E) of the Bankruptcy Code which exempts from a debtor's estate:
(10) The debtor's right to receive
(F) a payment under a stock bonus, pension, profit sharing, annuity, or similar plan or contract on account of illness, disability, death, age, or length of service, to the extent reasonably necessary for the support of the debtor and any dependent of the debtor, unless . . . 11 U.S.C. 522(d)(10)(E); See also, § 6, Uniform Exemptions Act; H.R.Rep. No. 595, 95th Cong., 1st Sess. 361 (1977).
The Debtor, Robert Bloom is 56 years old. His co-debtor spouse, Alison, is 43 years old. They have one minor dependent, age fifteen months. A review of the Debtors' petition and other portions of the record reveals that they have been employed for a combined total of eight years on their present jobs and have scheduled assets totalling $88,775.00. Their scheduled debts indicate secured debts of $75,459.00 and unsecured debts of $18,710.47, totalling $94,169.48 among twenty-four scheduled creditors. Two of their secured debts have been reaffirmed, inclusive of the mortgage on their personal residence (Indiana Mortgage Corp.) and a debt owed to National City Bank. Their estimated monthly expenses are stated at $2,004.75. Total exemptions claimed from their estate, including the subject IRA account, total $17,400.00. The reaffirmed debts total $68,418.03 and, when viewed against their total indebtedness of $94,169.48, show that the Debtors effectively are seeking a discharge of some $25,751.00 of debt, including scheduled exemptions.
Although the Debtors argue that the co-debtor husband is approaching retirement, that averment by their counsel is not supported in the record. Further, to the extent that certain of their assets may have been abandoned, that does not alter the undisputed representation that the Debtors have not relied upon their IRA account since it was established in 1983 for their basic support.
The burden of proof respecting a motion for turnover is on the movant. Here, the Trustee has sustained that burden by clear and convincing evidence.
The Debtors' argument relative to the legislative intent of the Ohio legislature when enacting § 2329.66(A)(10)(c) is without merit. The statutory language of that section is unambiguous. Where the statutory language clearly expresses the legislative intent, a court may not read another meaning into the statute in order to arrive at a more preferable result. Central Trust Co. v. Official Creditors' Comm., 454 U.S. 354, 359-60, 102 S.Ct. 695, 697-69, 70 L.Ed.2d 542 (1982). Further, the Debtors' equal protection argument has been considered and is not well-founded.
Section 2329.66(A)(10)(c), Ohio Revised Code, allows the exemption of an IRA only to the extent that such exemption is reasonably necessary for the support of the debtor and any dependents. When the Debtors' situation is viewed against that statutory requirement, one can reasonably and fairly conclude that the full amount of *448 their IRA deposit is not required to meet their basic support needs. This finding is reached upon consideration of the Debtor's reaffirmation of a majority of their scheduled indebtedness; the undisputed representation that their IRA deposit has remained undisturbed since it was opened in 1983; their passive income, coupled with the existence of other bank accounts including a savings account; their relative ages; their employability; and their earning power. See, In re Bartlett, 67 B.R. 455 (Bankr.W.D.Mo.1986); In re Phillips, 45 B.R. 529, 533 (Bankr.N.D.Ohio 1984); In re Taff, 10 B.R. 101, 7 B.C.D. 493 (Bankr. Conn.1981). Generally, when there exists the presence of such evaluative criteria, the claimed exemption has been wholly disallowed. In this matter, however, the Court has also considered the estimated monthly expenses of the Debtors which are undisputed and are otherwise within reasonable limits. Those expenses are estimated at $2,004.00 monthly and barely exceed the Debtors' aforementioned net monthly income. For this reason, the full amount of the IRA will not be submitted for turnover. See, In re Taff, supra.
Accordingly, the Trustee's objection is sustained, and the Debtors will immediately remit an amount of $5,500.00 from their IRA to the Trustee. Failure to make such remittance within ten (10) days from the date of this Order will result in the full amount of the IRA ($10,291.60) being subject to recovery by the Trustee.
IT IS SO ORDERED.
NOTES
[1] Using the Debtors' weekly income figures, their combined net monthly income ($1,925.10) actually is greater than that alleged by the Trustee ($1,714.92). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/896475/ | 604 N.W.2d 860 (2000)
2000 ND 17
Orlyn WANSTROM, Claimant and Appellant,
v.
NORTH DAKOTA WORKERS COMPENSATION BUREAU, Appellee, and
City of Bismarck, Respondent.
No. 990306.
Supreme Court of North Dakota.
January 24, 2000.
Kathryn L. Dietz, Dietz, Little & Haas, Bismarck, ND, for appellant.
Brent J. Edison, Special Assistant Attorney General, Bismarck, ND, for appellee.
VANDE WALLE, Chief Justice.
[¶ 1] Orlyn Wanstrom appealed from a district court judgment affirming a Workers Compensation Bureau decision dismissing Wanstrom's claim. The Bureau held because Wanstrom filed his claim after July 1, 1997, he was subject to N.D.C.C. § 65-01-15 (1995), and thus prohibited from using the presumption under N.D.C.C. § 65-01-02(18)(d) (1995). We hold the Bureau erred as a matter of law by concluding the application date was dispositive instead of the injury date, and remand for additional Findings of Fact and Conclusions of Law as to whether the presumption has been successfully rebutted.
[¶ 2] Wanstrom was a firefighter with the City of Bismarck from May 1, 1974 until June 30, 1997. Dr. Monica T. Paulo examined Wanstrom on June 6, 1997. Paulo's report diagnosed Wanstrom with chronic obstructive pulmonary disease and stated that Wanstrom was at risk for further *861 exposure to smoke or other inhalants. On June 30, 1997, Wanstrom was placed on medical leave by his employer.
[¶ 3] Wanstrom filed a claim with the Bureau on July 3, 1997.[1] He sought application of the presumption in N.D.C.C. § 65-01-02(18)(d) (1995). If applicable, the statute would presume Wanstrom's lung condition was suffered in the line of duty. N.D.C.C. § 65-01-02(18)(d) (1995).[2] The Administrative Law Judge ("ALJ") held N.D.C.C. § 65-01-15 (1995), prohibits Wanstrom from using this presumption. Section 65-01-15, N.D.C.C., requires Wanstrom to provide "yearly documentation from a physician which indicates ... [he]... has not used tobacco for the preceding two years," in order to use the presumption in section 65-01-15(18)(d), N.D.C.C. It is undisputed Wanstrom has smoked one to one-and-one-half packs of cigarettes a day for approximately 30 years. Since Wanstrom had not complied with N.D.C.C. § 65-01-15, the ALJ held he was not eligible for the presumption. The district court affirmed the Bureau's order.
[¶ 4] Wanstrom's appeal is limited in scope. He argues N.D.C.C. § 65-01-15 does not apply to him because firefighters were not "subject to" the section until July 1, 1997, and Wanstrom's injury date was before July 1, 1997. It is undisputed Wanstrom's date of injury was before July 1, 1997. The dispositive issue on this appeal is whether the date of injury or the date of claim filing should be used in determining if a worker is "subject to" N.D.C.C. § 65-01-15.
[¶ 5] In an appeal from a district court judgment entered on review of an administrative agency decision, we review the decision of the agency, rather than that of the district court, Vraa v. North Dakota Workers Comp. Bureau, 1999 ND 6, ¶ 8, 588 N.W.2d 857, but the district court's analysis is entitled to respect. Holmgren v. North Dakota Workers Comp. Bureau, 455 N.W.2d 200, 201 (N.D. 1990). The interpretation of a statute is a question of law, which is fully reviewable by this court. Jensen v. North Dakota Workers Comp. Bureau, 1997 ND 107, ¶ 9, 563 N.W.2d 112. "Because this appeal presents only a question of law, §§ 28-32-19 and 28-32-21, N.D.C.C., require us to affirm the Bureau's order unless it `is not in accordance with the law.' " Id. (citing section 28-32-19(1)).
[¶ 6] Section 65-01-15, N.D.C.C., became effective on August 1, 1995. It says a "full-time paid firefighter ... employed on June 30, 1995, is not subject to this section until July 1, 1997." N.D.C.C. § 65-01-15 (1995). The legislative history appears to show the legislature's intent was to allow time for tobacco users to comply with the statute, by ending their tobacco use immediately in 1995 so they could demonstrate by 1997 they had not used tobacco for two years.[3]See Hearing on S.B.2085 Before the Senate Judiciary Comm., 54th N.D. Legis. Sess. (March 31, 1995) (testimony of Representative Berg). This fact, however, gives us no guidance in determining whether the statute applies to a worker injured before being "subject to" its terms, but applies for benefits after *862 being "subject to" its terms. N.D.C.C. § 65-01-15.
[¶ 7] We have consistently held " `unless otherwise provided, the statutes in effect on the date of an injury govern workers' compensation benefits.' " Jensen, at ¶ 11; see Saari v. North Dakota Workers Comp. Bureau, 1999 ND 144, ¶ 10, 598 N.W.2d 174; Engebretson v. North Dakota Workers Comp. Bureau, 1999 ND 112, ¶ 11, 595 N.W.2d 312; Geck v. North Dakota Workers Comp. Bureau, 1998 ND 158, ¶ 6, 583 N.W.2d 621; Loberg v. North Dakota Workers Comp. Bureau, 1998 ND 64, ¶ 9, 575 N.W.2d 221; Fuhrman v. North Dakota Workers Comp. Bureau, 1997 ND 191, ¶ 7 n. 2, 569 N.W.2d 269; Anderson v. North Dakota Workers Comp. Bureau, 553 N.W.2d 496, 498 (N.D.1996); Thompson v. North Dakota Workers' Comp. Bureau, 490 N.W.2d 248, 251 (N.D.1992).
[¶ 8] In some statutes the legislature has stated the injury date is not relevant to the section. See, e.g., N.D.C.C. § 65-05-08(5) (Supp.1999) (stating "[t]he provisions of this section apply to any disability claim asserted against the fund on or after July 1, 1991, irrespective of injury date") (emphasis added). Here, however, the drafters of N.D.C.C. § 65-01-15 did not prohibit application of the statute based on the date of injury or specify another basis for being "subject to" the statute. Thus, we will continue to follow our precedent that " `unless otherwise provided, the statutes in effect on the date of an injury govern workers' compensation benefits.' " Jensen, at ¶ 11. Wanstrom was injured before becoming "subject to" the terms of N.D.C.C. § 65-01-15, and thus the presumption in N.D.C.C. § 65-01-02(18)(d) applies.
[¶ 9] The Bureau's decision was not in accordance with the law. We reverse the judgment and remand the matter to the district court for entry of a judgment reversing the Bureau's order and remanding the matter for the Bureau to determine whether the presumption in N.D.C.C. § 65-01-02(18)(d) has been successfully rebutted.
[¶ 10] CAROL RONNING KAPSNER, MARY MUEHLEN MARING, WILLIAM A. NEUMANN, JJ., EVERETT NELS OLSON, D.J., concur.
[¶ 11] EVERETT NELS OLSON, D.J., sitting in place of DALE V. SANDSTROM, J., disqualified.
NOTES
[1] At the hearing Wanstrom's position was that he filed a claim for his lung condition with the Bureau on June 30, 1997, but he conceded for purposes of appeal the claim filing date was July 3, 1997.
[2] Section 65-01-02(18)(d), N.D.C.C. (1995), reads:
However, any condition or impairment of health of a full-time paid firefighter or law enforcement officer caused by lung or respiratory disease, hypertension, heart disease, or exposure to infectious disease as defined by sections 23-07.3-01 and 23-07.3-02, or occupational cancer in a full-time paid firefighter, resulting in total or partial disability or death is presumed to have been suffered in the line of duty.
[3] Although the legislative history appears to show the legislature wanted to give smokers time to comply with the statute, the time between the statute's effective date and the date persons became subject to it was only 23 months. | 01-03-2023 | 06-08-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1141345/ | 868 P.2d 268 (1994)
In the Matter of the Worker's Compensation Claim of:
Annette BEARDEN, Appellant (Employee/Claimant),
v.
STATE of Wyoming, ex rel., WYOMING WORKERS' COMPENSATION DIVISION, Appellee (Objector/Defendant).
No. 93-119.
Supreme Court of Wyoming.
February 9, 1994.
Robert A. Nicholas of Hettinger & Leedy, Riverton, representing the appellant.
Joseph B. Meyer, Atty. Gen., John W. Renneisen, Deputy Atty. Gen., Kenneth E. Spurrier, Asst. Atty. Gen., and Thomas C. Bancroft, Sp. Asst. Atty. Gen., representing the appellee.
Before MACY, C.J., and THOMAS, CARDINE, GOLDEN and TAYLOR, JJ.
MACY, Chief Justice.
Appellant Annette Bearden requested an administrative hearing after the Wyoming Workers' Compensation Division refused to pay part of her claimed medical bills. The hearing examiner denied Ms. Bearden's claim, and on appeal the district court affirmed the hearing examiner's decision. In essence, we are asked to determine whether substantial evidence existed to support the hearing examiner's conclusion that Ms. Bearden's neck injury was not a work-related compensable injury.
We affirm.
Ms. Bearden presents the following issues for our review:
*269 1. Is [Ms. Bearden's] cervical injury work related and therefore compensable under the Wyoming Worker[']s Compensation Act?
2. The underlying factual issue that must be resolved to answer this question is:
Did [Ms. Bearden's] original injury to her lumbar spine cause the subsequent injury to her cervical spine, and if so, is it compensable?
In February 1990, Ms. Bearden, then a Wyoming State Training School employee, injured her back while she was trying to break a disabled patient's fall. She promptly reported her back injury to her employer and began receiving medical treatment paid for by the Workers' Compensation Division.
Approximately four months later, as she was leaving her home to return a performance evaluation to her employer, Ms. Bearden tripped on a nail which was protruding from the floor of her porch. She fell, aggravated her back injury, and also injured her neck. Ms. Bearden did not report her neck injury to either her employer or the Workers' Compensation Division.
The Workers' Compensation Division continued to pay for Ms. Bearden's medical care until, approximately ten months after she injured her neck, she had her neck x-rayed and underwent an MRI in order to have her neck injury diagnosed. The Workers' Compensation Division denied Ms. Bearden's claim for payment of expenses related to the neck injury.
Ms. Bearden contends that, because she was on her way to deliver a performance evaluation to her employer, she injured her neck during the course of her employment and that the injury was, therefore, compensable. The hearing examiner found that Ms. Bearden was not acting within the scope of her employment when she tripped on the nail and that her neck injury was excluded from coverage by Wyo.Stat. § 27-14-102(a)(xi) (Supp.1993).
Section 27-14-102(a)(xi) defines "injury" for worker's compensation purposes:
(xi) "Injury" means any harmful change in the human organism other than normal aging and includes damage to or loss of any artificial replacement and death, arising out of and in the course of employment while at work in or about the premises occupied, used or controlled by the employer and incurred while at work in places where the employer's business requires an employee's presence and which subjects the employee to extrahazardous duties incident to the business.
Standard of Review
The scope of our review of administrative decisions is limited by Wyo.Stat. § 16-3-114(c) (1990). In this instance:
Our task is to examine the entire record to determine if substantial evidence exists to support the hearing examiner's findings. We will not substitute our judgment for that of the hearing examiner if his decision is supported by substantial evidence. Substantial evidence is relevant evidence which a reasonable mind might accept in support of the agency's conclusions.
Romero v. Davy McKee Corporation, 854 P.2d 59, 61 (Wyo.1993) (citing Farman v. State ex rel. Wyoming Workers' Compensation Division, 841 P.2d 99, 102 (Wyo.1992)).
Ms. Bearden contends that her neck injury was compensable either because she was in the course of her employment at the time she injured her neck or alternatively because her work-related back injury caused her neck injury.
Course of Employment
Ms. Bearden testified at her hearing that she was required to return her performance evaluation, along with her comments, to her employer. She also testified that, by "go[ing] out of the house and get[ting] some air outside," she was following her doctor's order to become more active. The record fails to reveal that Ms. Bearden's employer or her doctor required her to hand deliver the evaluation. The record does reveal, however, that, when Ms. Bearden injured her neck, she was not in the course of her employment, in a place her employer required her to be, or in or about her employer's premises.
*270 We hold that the record contained substantial evidence to support the hearing examiner's findings that Ms. Bearden incurred her neck injury outside the scope of her employment and that compensation for her injury was thus excluded by § 27-14-102(a)(xi).
Work-Related Injury
Ms. Bearden also contends that her neck injury was compensable because her work-related back injury caused that injury. She claims that she tripped on the nail and injured her neck because the back injury caused her to drag her feet and because the back injury was her reason for hand delivering the evaluation.
As part of her burden of proof at the hearing, Ms. Bearden had to prove the existence of a causal connection between the neck injury and the course of her employment. Johnson v. State ex rel. Wyoming Worker's Compensation Division, 798 P.2d 323 (Wyo.1990). A "causal connection exists when there is a nexus between the injury and some condition, activity, environment or requirement of the employment." Id. at 325 (citing Baker v. Wendy's of Montana, Inc., 687 P.2d 885, 891 (Wyo.1984)).
Ms. Bearden testified at the hearing that, because of her back injury, she was dragging her feet when she tripped on the nail. The medical evidence considered by the hearing examiner,[1] however, gives conflicting accounts about Ms. Bearden's ability to walk. Two doctors examined Ms. Bearden after she injured her back and before she injured her neck. The first doctor reported three examinations: "3/20/90: . . . She really gets around quite well. . . . With ambulation, she walks normally"; "4/2/90: . . . She is walking well"; and "5/9/90: . . . Since she stopped taking the Feldene, she has noted increased back pain and some other psychosomatic type symptoms such as trembling, shaking, sweating and that sort of thing." The second doctor reported one examination: On April 6, 1990, "she says she can walk about fifteen feet and then she has to stop to rest because of the numbness increasing down the legs."
The hearing examiner must assess the credibility of the witnesses and weigh the evidence. We will not substitute our judgment for that of the hearing examiner if his decision is supported by substantial evidence. Romero, 854 P.2d at 61. We hold that the record contained sufficient evidence for the hearing examiner to find that Ms. Bearden's neck injury resulted from the condition of the house and not from her prior medical treatment or prior medical condition.
Ms. Bearden asks us to adopt a "quasi-course of employment" analysis used by other jurisdictions to test for compensable injuries. She claims that the hearing examiner did not apply this analysis and that, if he had, she would have prevailed.
Under the proposed test, injuries are compensable if they arise out of "quasi-course" activities. Those activities are defined as:
activities undertaken by the employee following upon his injury which, although they take place outside the time and space limits of the employment, and would not be considered employment activities for usual purposes, are nevertheless related to the employment in the sense that they are necessary or reasonable activities that would not have been undertaken but for the compensable injury. "Reasonable" at this point relates not to the method used, but to the category of activity itself.
1 ARTHUR LARSON, THE LAW OF WORKMEN'S COMPENSATION § 13.11(d) at 3-542 (1993).
Contrary to Ms. Bearden's claim, however, the hearing examiner did consider the proposed test. He found:
The unusual fact situation of this case in which the employee is homebound because of an injury she incurred within the scope of her employment creates an expectation that any subsequent injury resulting from her initial injury would be covered. I do not disagree with this; however, in this case, it appears the injury was the result of a condition of her house when she tripped on a nail and fell when exiting that house. She was not within the scope of her employment. The injury she received was *271 not a result of her medical treatment nor medical condition and she certainly was not within the course of her employment.
In effect, the hearing examiner found that the "but for" causation requirement of the proposed test was not met, that Ms. Bearden did not hand deliver the evaluation form because she had a back injury, and that the back injury did not cause Ms. Bearden to injure her neck. Because the proposed test would not control the outcome of this case, we do not find it necessary to consider, in the abstract, the merit of the "quasi-course of employment" test proposed by Ms. Bearden.
Summary
The record contains substantial evidence to support the hearing examiner's findings that Ms. Bearden's neck injury did not arise out of or within the scope of her employment and that her earlier back injury did not cause her neck injury. The hearing examiner's findings were not arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. Section 16-3-114(c).
Affirmed.
NOTES
[1] Ms. Bearden gave the only testimony at the hearing. The hearing examiner took judicial notice of the contents of the court file. | 01-03-2023 | 10-30-2013 |
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