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https://www.courtlistener.com/api/rest/v3/opinions/2857780/ | WESTECH
IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-90-127-CV
WESTECH ENGINEERING, INC.,
APPELLANT
vs.
CLEARWATER CONSTRUCTORS, INC., A DIVISION OF PHELPS, INC.,
APPELLEE
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 167TH JUDICIAL DISTRICT
NO. 448,087, HONORABLE JOE B. DIBRELL, JUDGE PRESIDING
This case involves a construction contract. In twenty-three points of error, the sub-contractor, WesTech Engineering, Inc. (WesTech), has challenged the trial court's determination
that it entered into and subsequently breached an agreement with the general contractor,
Clearwater Constructors, Inc. (Clearwater) to provide wastewater-treatment equipment. In sixteen
points of error, WesTech attacks the legal or factual sufficiency of the evidence supporting the
trial court's judgment that WesTech pay damages to Clearwater for breach of contract; in the
remaining seven points of error, WesTech attacks particular conclusions of law underlying the
judgment. Clearwater, in turn, has brought two cross-points complaining of the trial court's
denial of consequential damages and certain expenses. We will affirm the judgment of the trial
court as modified.
THE CONTROVERSY
This appeal arises from WesTech and Clearwater's business dealings during 1987
and 1988. In the summer of 1987, the City of Austin undertook to expand and improve its Walnut
Creek Wastewater Treatment Facility. Early in the process, the City retained the engineering firm
of Camp, Dressar & McKee (CDM) to prepare the plans and specifications for the project. The
City then solicited bids from general contractors, one of which was Clearwater Constructors.
WesTech was aware of the Walnut Creek Facility expansion and made bids to
prospective general contractors, including Clearwater, in an attempt to secure a portion of the
project. In these bids, WesTech offered to supply particular water-treatment equipment called for
in the plant expansion. Specifically, WesTech sought to supply (1) two final clarifier mechanisms
("clarifiers"), and (2) a dissolved air flotation sludge thickening system ("DAF"). On June 30,
1987, Clearwater received a bid from WesTech on these two items and used WesTech's figures
when formulating its own bid to the City.
In August 1987, the City chose Clearwater as the general contractor for the plant
expansion project. In a letter of intent dated September 15th, notifying WesTech that it had been
selected to supply the clarifiers and the DAF, Clearwater indicated that it would forward to
WesTech a purchase agreement "in the very near future." WesTech received an unsigned
agreement from Clearwater in mid-December.
A WesTech representative signed the purchase agreement but attached a letter to
Clearwater indicating that the agreement contained terms that differed from WesTech's initial
proposal. In its letter dated December 16, 1987, WesTech expressed its intent that the terms of
its original proposal be "made a part of the [purchase] order." In its findings of fact, the trial
court found that Clearwater subsequently signed the purchase agreement and dated it December
18, 1987. In separate findings, the trial court referred to this purchase agreement as "the
contract" between the parties.
Initially, relations between WesTech and Clearwater proceeded normally.
WesTech submitted to Clearwater specific data concerning both the clarifiers and the DAF.
Problems arose, however, when the project engineering firm, CDM, determined that WesTech's
clarifier equipment would not meet the particular specifications set out in the City's contract. The
parties conducted a number of meetings to resolve these problems. For its part, WesTech
supplied additional data on its proposed equipment, which Clearwater and CDM re-evaluated.
Nevertheless, CDM decided that the WesTech equipment would not comply with the City's
contract requirements.
Ultimately CDM concluded that the central-drive gears to be used in WesTech's
clarifiers did not meet the durability requirements set out in the City's plans and specifications.
Clearwater notified WesTech of its decision to seek an alternate source for the clarifiers and
informed WesTech that it would be liable for Clearwater's increased procurement costs, if any.
In March 1988, WesTech supplied Clearwater with its DAF equipment submittal.
Later that month, CDM engineers rejected WesTech's DAF submittal on the grounds that
WesTech lacked the DAF installation experience called for in the City contract. Clearwater again
notified WesTech of the rejection and informed WesTech it would be accountable for any
increased costs in procuring DAF equipment from an alternate source. Eventually Clearwater
obtained the clarifiers and the DAF from other companies, but at a cost greater than that
contracted for with WesTech.
In March 1990, Clearwater filed suit against WesTech for breach of contract,
hoping to recover its increased costs for the equipment. After a trial before the court, Clearwater
was awarded $123,495 in "cover" costs resulting from WesTech's breach, plus prejudgment
interest and attorney's fees. WesTech now appeals the trial court's judgment.
STANDARDS OF REVIEW
At WesTech's request, the trial court filed findings of fact and conclusions of law
in support of its judgment; some eighty-nine findings of fact and twenty-seven conclusions of law
are contained in the record. In addition, the record contains a statement of facts from the
proceedings.
Findings of Fact
We attach to findings of fact the same weight that we attach to a jury's verdict upon
jury questions. City of Clute v. City of Lake Jackson, 559 S.W.2d 391, 395 (Tex. App. 1977,
writ ref'd n.r.e.). Findings of fact are reviewable for legal and factual sufficiency of the evidence
by the same standards used to review jury findings. Okon v. Levy, 612 S.W.2d 938, 941 (Tex.
App. 1981, writ ref'd n.r.e.) (citing Hall v. Villareal Dev. Corp., 522 S.W.2d 195 (Tex. 1975)).
An appellant who challenges the legal sufficiency of the evidence supporting an
issue upon which it did not have the burden of proof must demonstrate that there is no evidence
to support the adverse finding. Raw Hide Oil & Gas, Inc. v. Maxus Exploration Co., 766 S.W.2d
264, 275 (Tex. App. 1988, writ denied). In reviewing a no-evidence point, we consider only the
evidence supporting the finding and we disregard all evidence to the contrary. Best v. Ryan Auto
Group, Inc., 786 S.W.2d 670, 671 (Tex. 1990). If there is any evidence supporting the finding,
we must overrule the point and uphold the finding.
When challenging the factual sufficiency of the evidence supporting an adverse
finding upon which it did not carry the burden of proof, an appellant must demonstrate that there
is insufficient evidence to support the adverse finding. Maxus Exploration Co., 766 S.W.2d at
275-76. We will consider and weigh all the evidence in support of and contrary to the finding.
Plas-Tex, Inc. v. U. S. Steel Corp., 772 S.W.2d 442, 445 (Tex. 1989). The contested finding will
be upheld unless we find that (1) the evidence is too weak to support the finding, or (2) the finding
is so against the overwhelming weight of the evidence as to be manifestly unjust. Garza v. Alviar,
395 S.W.2d 821, 823 (Tex. 1965). We will not substitute our judgment for that of the trier of
fact merely because we reach a different fact conclusion. Otis Elevator Co. v. Joseph, 749
S.W.2d 920, 923 (Tex. App. 1988, no writ).
On those issues on which an appellant has the burden of proof, it must prevail on
a no-evidence challenge and then must demonstrate on appeal that the evidence conclusively
establishes the issue in its favor as a matter of law. Holley v. Watts, 629 S.W.2d 694, 696 (Tex.
1982). Only when the contrary proposition is established conclusively by the evidence will we
sustain the point of error. Meyerland Community Improvement Ass'n v. Temple, 700 S.W.2d
263, 267 (Tex. App. 1985, writ ref'd n.r.e.).
Conclusions of Law
The trial court's conclusions of law are always reviewable. Middleton v. Kawasaki
Steel Corp., 687 S.W.2d 42, 44 (Tex. App. 1985, writ ref'd n.r.e.). (1) Conclusions of law will be
upheld on appeal if the judgment can be sustained on any legal theory supported by the evidence.
Simpson v. Simpson, 727 S.W.2d 662, 664 (Tex. App. 1987, no writ). Incorrect conclusions of
law will not require reversal, however, if the controlling findings of facts will support a correct
legal theory. Valencia v. Garza, 765 S.W.2d 893, 898 (Tex. App. 1989, no writ). Moreover,
conclusions of law may not be reversed unless they are erroneous as a matter of law. Mercer, 715
S.W.2d at 697.
DISCUSSION
Preservation of Error
Before discussing the substantive issues of this case, we address Clearwater's
contention that WesTech has not preserved error. Clearwater argues that WesTech failed to
preserve error in two respects. First, WesTech failed to present to the trial court any request,
objection or motion complaining of the issues WesTech has raised on appeal as required by Tex.
Rule of Appellate Procedure 52. See Tex. R. App. P. Ann. 52 (Pamph. 1992). Although Rule
52 was amended to allow factual-insufficiency points challenging a finding of fact in a bench trial
to be raised for the first time on appeal, Clearwater argues that the amendment came after
WesTech's time to perfect its appeal had expired. Second, Clearwater asserts that under the
former rule WesTech failed to follow the procedures for preserving a no-evidence point.
We disagree with Clearwater's interpretation of Rule 52. As WesTech points out
in its reply brief, challenges to a finding of fact's legal and factual sufficiency can be made for
the first time by properly raising them as points of error. Kissman v. Bendix Home Sys., Inc.,
587 S.W.2d 675, 678 (Tex. 1979); Bluebonnet Express, Inc. v. Employers Ins., 651 S.W.2d 345
(Tex. App. 1983, writ ref'd n.r.e.). As the explanation following Rule 52 indicates, the purpose
of the amendment is "to clarify appellate requisites from nonjury trials." Tex. R. App. P. Ann.
52 cmt. (Pamph. 1992) (emphasis added). We agree with WesTech that the amendment to the
rule does not change prior case law as much as it clarifies that law, and we conclude that WesTech
has properly preserved error for appeal.
Applicability of Uniform Commercial Code
In general, the Uniform Commercial Code (UCC), Tex. Bus. & Com. Code Ann.
§§ 1.01 - 11.108 (1968, 1991 & Supp. 1992), (2) applies to the sale of goods. § 2.102 (1968).
Where a contract contains a mix of sales and services, the UCC applies if the sale of goods is the
dominant factor or "essence" of the transaction. Freeman v. Shannon Constr., Inc., 560 S.W.2d
732, 738 (Tex.. App. 1977, writ ref'd n.r.e.). Although WesTech's original proposal of June 30,
1987, included some service trips for inspection, startup, instruction of plant personnel, and
observation, the contract was predominantly for the supply of equipment. The later
communications from WesTech specifically noted that most service items would be in addition
to the contract price. Accordingly, the UCC applies to this transaction. See Custom Controls Co.
v. Rogers Ins., 652 S.W.2d 449, 452 (Tex. App. 1983, no writ) (custom manufactured wellhead
control panels are "goods" for purposes of UCC); see also Mace Indust. v. Paddock Pool Equip.
Co., 339 S.E.2d 527, 529 (S.C. Ct. App. 1986) (applying UCC to sale of wastewater treatment
equipment).
Contract Formation
In its first two points of error, WesTech challenges the legal and factual sufficiency
of the evidence to support:
Finding of fact no. 15: "On or about October 12, 1987, Clearwater sent
WesTech a Purchase Agreement (the "Contract") to document the parties'
agreement"; and
Related findings of fact nos. 16, 17, 25, 28, 41, 42 and 44, regarding specific
dates and terms of the contract.
We note that WesTech does not deny that the parties had an agreement; rather, the dispute centers
on which document or documents supply the terms of their agreement. We understand WesTech's
argument to be that the evidence adduced not only fails to support finding of fact no. 15, but also
dictates a contrary finding. We disagree.
This exchange of documents between the parties gives rise to a classic battle of the
forms. See § 2.207; see also James J. White and Robert S. Summers, Uniform Commercial Code,
§ 1-3, at 28-49 (3rd ed. 1988) (analyzing applicability of Uniform Commercial Code § 2-207 to
agreements reached through battles-of-the-forms). We begin by reviewing the exchanges and
documents involved in the formation of this commercial agreement:
Date Transaction
06/30/87 WesTech sends Clearwater original bid proposal to
supply clarifiers and DAF. Clearwater uses WesTech's
figures in submitting its bid to City.
08/21/87 Clearwater selected as general contractor.
09/15/87 Clearwater sends WesTech a letter of intent to contract.
10/12/87 Clearwater sends unsigned purchase agreement to WesTech
containing new terms and different terms.
12/16/87 WesTech signs purchase agreement and returns it to Clearwater,
objecting to certain terms and requiring that its bid proposal be
incorporated into the agreement.
12/18/87 Effective date of Clearwater's signing purchase agreement.
02/12/88 Clearwater mails signed purchase agreement to WesTech.
WesTech's original proposal to Clearwater dated June 30th contained four sections:
(1) a four-page list detailing the equipment WesTech proposed to furnish for the project; (2) a
boiler-plate form entitled "General Terms and Conditions;" (3) an additional preprinted list of
conditions entitled "specifications-escalation;" and (4) a boiler-plate warranty.
Clearwater used WesTech's figures in submitting its bid to the City; it sent
WesTech a letter of intent to contract on September 15th. On October 12th, Clearwater
forwarded to WesTech Clearwater's unsigned printed form entitled "Standard Purchase Agreement
(Order)," which contained typed-in details particular to this transaction. WesTech signed and
returned the purchase agreement, along with a three-page letter from Russ Wright, WesTech's
group leader for the project, asking that WesTech's original bid proposal be incorporated into the
purchase agreement and outlining several "items of difference." A Clearwater representative
placed the purchase agreement and attached letter in his desk drawer for nearly two months. After
the problems with the clarifiers arose, Clearwater finally sent the signed agreement to WesTech
on February 12, 1988, agreeing to the suggested price increase but ignoring all other comments
in Wright's letter.
In finding of fact no. 15, the court found that Clearwater sent WesTech a purchase
agreement (the "contract") on October 12, 1987, to document the parties' agreement. WesTech
argues that the unsigned purchase agreement of October 12, 1987, cannot be the contract because
it contained terms that conflicted with the original bid proposal. Further, WesTech insists that
it signed the purchase agreement on the express condition that the terms of WesTech's original
bid be made a part of the agreement. Clearwater replies that the evidence supports the trial
court's finding that the purchase agreement Clearwater sent to WesTech does document the
parties' agreement. Clearwater notes that the trial court did not state that the purchase agreement
embodied the exclusive terms of the contract, but merely found that it documented the parties'
agreement.
One policy goal of the UCC is to liberalize the formation of contracts so that the
parties' intentions are not frustrated by the difficulties of fitting a transaction into the traditional
common-law model of offer and acceptance. See §§ 2.204, 2.206, and cmts.; Caroline N. Brown,
Restoring Peace in the Battle of the Forms: A Framework for Making Uniform Commercial Code
Section 2-207 Work, 69 N.C. L. Rev. 893, 899 (1991). To that end the UCC directs that "an
offer to make a contract shall be construed as inviting acceptance in any manner and by any
medium reasonable in the circumstances." § 2.206(a)(1).
It is clear that Clearwater accepted WesTech's offer to supply wastewater
equipment for the expansion of the Walnut Creek facility, either by use of WesTech's figures in
submitting its bid to the City, by giving notice of its intent to contract with WesTech, or by
sending its purchase agreement to WesTech. It does not matter that the purchase agreement
contained additional or different terms:
(a) A definite and seasonable expression of acceptance or a written confirmation
which is sent within a reasonable time operates as an acceptance even though it
states terms additional to or different from those offered or agreed upon, unless
acceptance is expressly made conditional on assent to the additional or different
terms.
§ 2.207(a). There is nothing in the purchase agreement that expressly required WesTech to assent
to its additional or different terms. We therefore treat Clearwater as having accepted WesTech's
offer and turn to the provisions of § 2.207(b) to determine whether the terms of the purchase
agreement became a part of the parties' agreement:
(b) The additional terms are to be construed as proposals for addition to the
contract. Between merchants such terms become part of the contract
unless:
(1) the offer expressly limits acceptance to the terms of the offer;
(2) they materially alter it: or
(3) notification of objection to them has already been given or is given within
a reasonable time after notice of them is received.
§ 2.207(b).
We begin with the statutory assumption that in this commercial transaction
Clearwater's additional terms became part of the contract unless WesTech's bid proposal expressly
limited the term of acceptance, the additional terms materially altered the parties' agreement, or
WesTech objected within a reasonable time. WesTech's bid proposal did not expressly limit
acceptance to its precise terms and nothing in the purchase agreement could be said to materially
alter the parties' agreement. (3) See § 2.207 cmts 4 and 5.
This transaction does not involve the sending of conflicting printed forms with no
other communications. WesTech signed and returned Clearwater's purchase agreement, and
indicated its agreement in Russ Wright's letter of December 16, 1987:
Thank you for your purchase order on the above referenced project. I apologize
for the lateness of my formal response. We appreciate the opportunity of doing
business with you and know that you will be pleased with our equipment.
Enclosed are the signed copies of your order. . . .
The next paragraph of Wright's letter sets forth WesTech's objections to certain additional and
different terms contained in Clearwater's purchase agreement:
In reviewing your purchase order, there are a few items which need further
clarification. We quoted this equipment through our sales representative based on
our proposal number 87314. This shall be made a part of the order. Any items of
difference are addressed below.
(Emphasis added). There follows a list of differences relating to pricing, submittals, shipment,
terms of payment, specifications, items of service not included in the contract, and some
miscellaneous provisions.
We understand WesTech to argue that by incorporating its original bid proposal
in the parties' agreement it effectively "knocked out" all additional or different terms contained
in Clearwater's purchase agreement. To adopt this argument we would have to ignore § 2.207(b)
and Wright's letter, which we decline to do. Rather, we believe Wright's letter, and WesTech's
signing of the purchase agreement, amounted to an acceptance of all of the terms of the purchase
agreement except those items of difference specifically noted in Wright's letter.
Section 2.207 generally applies to agreements in which at least one party's printed
form plays a role. Brown, supra, at 899-901. This section furthers the Code's goal of promoting
the formation of contracts by adding a presumption that the printed form will not always be read.
"The obvious utility of preprinted forms rests in part upon their customary use without being read
by either party. . . . The customary failure to read forms is the very reality intentionally
accommodated by section 2-207." Id. at 938.
Knowing that when both parties use printed forms, the offer and acceptance are
likely to contain conflicting terms, the drafters of section 2.207(b) offer a mechanism for
ascertaining the parties' intentions in a commercial context:
The drafters apparently believed that if the time and money spent in the drafting
of preprinted forms for use in modern commerce were not to be wasted, the forms'
preprinted terms must be given some effect. But they seem to have recognized as
well that it is pure fantasy to construct a theory of effectiveness based on the
presumption that the forms will be read. It might be so, but the likelihood is very
small. Consequently, the significance of a simple exchange of forms (or an
exchange of forms coupled with performance) must be determined in large part by
rather mechanical rules derived from the drafters' presumption of what the parties
expected based on their reading only the filled-in terms."
Id. at 904. (Emphasis in original).
In ascertaining the parties' intentions, the "filled-in" terms are to be given more weight
than preprinted terms. "Not being part of the preprinted verbiage, the filled-in terms reflect not
only a high degree of importance attached to them by the offeree, but also the term's particular
applicability to the specific agreement." Id. at 912. Wright's letter represented important "filled-in" terms particular to this agreement. We conclude that the specific terms of the typewritten
letter should prevail over the general printed terms of the original bid proposal. The request that
the bid proposal be incorporated into the agreement did not nullify Wright's acceptance of the
terms of the purchase agreement, subject only to the items of difference specified in his letter.
We would hold that Wright's letter must also be considered part of the parties' agreement, but
because we do not read the trial court's finding of fact to establish the purchase agreement as the
exclusive documentation of the parties' agreement, we find sufficient evidence in the record to
defeat both the no-evidence and the sufficiency-of-the-evidence challenges to finding of fact no.
15. We overrule point of error one.
There is evidence in the record sufficient to defeat the no-evidence challenge to
findings of fact nos. 16, 17, 25, 28, 41, 42 and 44. We find conflicting evidence in the record
regarding the dates on which Clearwater actually signed the purchase agreement and the dates for
WesTech's submittals and delivery of the equipment. However, credibility choices are left to the
trial court. Great American Ins. Co. v. Murray, 437 S.W.2d 264, 266 (Tex. 1969). Further, we
cannot say that these findings are so against the overwhelming weight of the evidence as to be
manifestly unjust, and we therefore overrule the sufficiency of the evidence challenges to findings
of fact nos. 16, 17, 41, 42, and 44.
To support our conclusion that findings of fact nos. 25 and 28 find sufficient
support in the evidence, we return to our previous discussion of how section 2.207(b) treats the
terms of Clearwater's purchase agreement in this transaction. These two findings of fact both
look to the purchase agreement (1) to hold WesTech liable for providing clarifiers and a DAF that
meet the specifications set forth in the contract between Clearwater and the City, and (2) to hold
WesTech liable for Clearwater's inability to perform timely under its contract with the City if
Clearwater's failure is attributable to WesTech's failure to perform.
WesTech relies on the following provision in its bid proposal to ask us to overturn
this finding of fact:
PARTIES TO CONTRACT: WesTech Engineering Inc. is not a party to or bound
by the terms of any contract between WesTech's customer and any other party.
WesTech's undertaking are limited to those defined in the contract between
WesTech and its direct customers.
Clearwater relies on the following provisions in its purchase agreement to sustain the court's
findings:
[Preprinted] THE VENDOR [WesTech] AGREES TO FURNISH, SUPPLY AND
DELIVER THE GOODS AND/OR SERVICES DESCRIBED BELOW IN
COMPLETE ACCORDANCE WITH THE GOVERNING CONTRACT
DOCUMENTS, INCLUDING ANY ADDENDA OR AMENDMENTS
THERETO, FOR THE VENDEE'S [Clearwater's] USE AND/OR
INCORPORATION IN THE ABOVE CAPTIONED PROJECT, TO WIT:
[Typed] "Furnish a complete job of all final clarifier equipment and dissolved air
flotation sludge thickening system equipment as required by the plans and
specifications, including Addenda numbers 1,2,3,and 4."
[Preprinted] STANDARDS CONDITIONS. IN ADDITION TO THE
FOREGOING PROVISIONS THE PARTIES HERETO ALSO AGREE AS
FOLLOWS:
[Typed] 13. In general, and subject only to the provisions hereof, the vendor shall
be bound to the vendee by the same terms and conditions by which the vendee is
bound to the owner. . . .
[Typed] 14. Vendor acknowledges that he has familiarized himself with all of the
conditions of the locality, project, plans and specifications and any other factor or
circumstance which may affect his performance under this agreement, and nothing
in this agreement shall obligate or render the vendee liable for additional payment
to the vendor on account of his misunderstanding or failure to familiarize himself
with such factors and conditions.
To decipher the parties' intentions from the conflicting terms, we give more weight
to the "filled-in" terms than to the preprinted terms. We conclude that when WesTech signed the
purchase agreement it consented to Clearwater's "filled-in" terms unless Wright specifically
excepted to them in his letter. Wright addressed specifications twice in his letter. Discussing
submittals, he said, "We are waiting for a complete set of plans and specifications that should be
on the way to us, as we have discovered that we need more complete information to properly
complete the submittal." Discussing specifications, he said, "WesTech quoted standard equipment
for this project, with modifications to match the specifications. Minor deviations may be taken
during the submittal process which make the equipment equal to or superior to that specified."
Neither of these statements can be reasonably interpreted as putting Clearwater on notice that
WesTech did not consider itself obligated to supply equipment that met the specifications of the
contract documents or otherwise bound to Clearwater on the same terms and conditions by which
Clearwater was bound to the City. We then conclude that the evidence supporting findings of fact
nos. 25 and 28, interpreted in light of section 2.207(b), defeats a no-evidence challenge and is not
so weak that it fails to support the findings. We overrule point of error two.
Condition Precedent
In its third point of error WesTech raises no-evidence and insufficient-evidence
challenges to finding of fact no. 84: "All conditions precedent to Westech's right and liability to
perform under the contract were met." WesTech contends that CDM's approval of its design
submittal was a condition precedent to WesTech's performance. We disagree.
Conditions precedent are generally disfavored in Texas:
In construing a contract, forfeiture by finding a condition precedent is to be
avoided when another reasonable reading of the contract is possible . . . . When
the intent of the parties is doubtful or when a condition would impose an absurd
or impossible result, the agreement will be interpreted as creating a covenant rather
than a condition . . . .
Criswell v. European Crossroads S. Ctr., 792 S.W.2d 945, 948 (Tex. 1990)(citations omitted).
The evidence supports the trial court's finding that WesTech unconditionally promised to supply
wastewater equipment that met the specifications of the project documents. The project engineer's
approval was not a condition precedent to WesTech's performance; rather, WesTech breached its
covenant to supply DAF equipment and clarifiers that met the contract specifications. The
evidence in the record defeats both a legal- and factual-sufficiency challenge. We overrule
WesTech's third point of error. We likewise overrule related points of error nineteen and twenty
challenging the court's findings that WesTech's bid offered to supply equipment that would meet
the plans and specifications in Clearwater's contract with the City.
Impossibility of Performance
The Uniform Commercial Code provides that a party to a contract may be excused
from performance because of an unforeseen supervening circumstance not within the
contemplation of the parties at the time of contracting. § 2.615, Cmt. 1. At trial, WesTech
unsuccessfully argued that it was excused from complying with the contract due to impossibility
of performance. In point of error eight, WesTech challenges, as against the great weight and
preponderance of the evidence, finding of fact no. 85 that WesTech is not excused from liability
because of impossibility of performance. Point of error ten challenges as erroneous the court's
conclusion of law no. 21 that WesTech is not excused for impossibility of performance, arguing
that this conclusion is based upon findings that are against the great weight and preponderance of
the evidence. Again, we disagree.
WesTech contends that it should be excused from performance because it could not
anticipate that CDM would interpret the contract specifications so strictly. Comments 4 and 8 to
§ 2.615 illustrate why WesTech does not escape from its contractual obligations under these
circumstances. Comment 4 gives several examples of events that may excuse performance, such
as a severe shortage of raw materials or supplies due to war, embargo, crop failure or unforeseen
shutdown of major sources of supply. The standard contractual arrangement of submitting
specifications to a project engineer is not contemplated as an impossibility. Further, comment 8
notes that the impossibility exception does not apply when the contingency in question is
"sufficiently foreshadowed at the time of contracting." WesTech knew from the beginning that
its clarifier and DAF submittals were subject to approval by the project engineer. We therefore
conclude that finding of fact no. 85 is not against the great weight and preponderance of the
evidence and overrule the eighth point of error. We likewise find conclusion of law no. 21 to be
supported by findings of fact that have evidentiary support in the record and overrule point of
error ten.
Challenges to the Project Engineer's Decisions Supporting Breach.
Having rejected WesTech's arguments that the engineer's approval was a condition
precedent to WesTech's performance, and that performance was an impossibility for WesTech,
we next consider all points of error challenging the project engineer's disapproval of WesTech's
submittals. These challenged findings of fact are essential to support the court's conclusion that
WesTech breached its covenant to supply wastewater equipment that met the project
specifications. Because the project engineer's decision as to approval or disapproval of submittals
is final, and because there is sufficient evidence in the record of CDM's disapproval of WesTech,
we reject all of WesTech's challenges to the findings of fact and conclusions of law upholding
CDM's decision that the WesTech equipment was not "equal" to the standards specified in the
contract documents.
WesTech had pledged to supply its standard equipment with minor deviations to
"make the equipment equal to or superior to that specified" (Wright's letter dated December 16,
1987). Specifically, WesTech complains that CDM applied the "or equal" provision too strictly
in disqualifying its clarifiers. Where a contract specifies that a project engineer shall be the final
arbitrator on disputed issues, the engineer's decision is final and conclusive unless she is guilty
of fraud, misconduct or gross mistake:
When parties to a building contract agree to submit questions which may arise
thereunder to the decision of the engineer, his decision is final and conclusive;
unless in making it he is guilty of fraud, misconduct, or such gross mistake as
would imply bad faith or failure to exercise an honest judgment . . . .
City of San Antonio v. McKenzie Constr. Co., 150 S.W.2d 989, 996 (Tex. 1941); Austin Bridge
Co. v. State, 550 S.W.2d 135, 137 (Tex. Civ. App. 1977, writ ref. n.r.e.); Plantation Foods, Inc.
v. R.J. Reagan Inc., 520 S.W.2d 432, 434 (Tex. Civ. App. 1978, writ ref'd n.r.e.). Even if
WesTech may have anticipated a more lenient application of project standards by CDM's
engineer, the engineer's decision to reject WesTech's equipment as nonconforming cannot be
challenged simply because another engineer might have arrived at a different decision:
[Her] decision cannot be set aside . . . simply by proving that some other engineer
would have acted differently or given a different decision. . . [or] simply on a
conflict of evidence as to what [s]he ought to have decided. This must be true,
because any other rule would simply leave the matter open for a court or jury to
substitute its judgment and discretion for the judgment and discretion of the
engineer.
McKenzie Constr. Co., 150 S.W.2d at 996.
WesTech does not allege, nor does the record reveal, any fraud, misconduct, or
gross mistake implying bad faith on CDM's part. The evidence supports and does not
preponderate against the findings of fact upholding the decisions of the project engineer. And we
find no errors in the complained-of conclusions of law that WesTech breached its agreement by
not supplying equipment that satisfied the project specifications as CDM interpreted and applied
those specifications.
We overrule the ninth point of error that there is no evidence or insufficient
evidence to support finding of fact no. 68 that WesTech's proposed gears did not meet project
specifications. For the same reason we overrule the fifteenth and sixteenth points of error
challenging the evidence to support findings of fact nos. 37 and 39 that the project engineer
properly investigated and properly rejected WesTech's experience involving DAF's.
We overrule point of error thirteen challenging as against the great weight and
preponderance of the evidence finding of fact no. 66 that the project engineer acted reasonably
and prudently in reviewing WesTech's performance under the contract. Under existing case law,
which affords almost total deference to the project engineer in such instances, the evidence
supports the court's finding that the engineer's actions were prudent and reasonable.
In point of error fourteen, WesTech challenges finding of fact no. 35 that
Clearwater did not unreasonably delay its efforts to have WesTech approved by the project
engineer. The evidence in the record supports the finding that Clearwater's efforts to secure
WesTech's approval were reasonable, and we cannot say that this finding is so clearly against the
great weight and preponderance of the evidence as to constitute a manifest injustice. We overrule
point of error fourteen.
Similarly, we find evidence in the record supporting the court's finding that
Clearwater was not arbitrary or unreasonable in failing to obtain all the details of the engineer's
decision to reject the WesTech clarifiers and did not wrongfully terminate WesTech's opportunity
to supply the clarifiers. WesTech was charged with meeting all of the specifications; failure of
its equipment to meet even one specification warrants rejection. Further, the rejection of the
WesTech clarifiers came after numerous resubmittals and working conferences had been
conducted with the goal of obtaining equipment approval. We cannot say that this finding is so
contrary to the overwhelming weight of the evidence as to be clearly wrong. We therefore
overrule point of error eleven.
We also overrule point of error twelve, challenging the court's finding that
WesTech refused to submit other final clarifier equipment in a timely manner. The expansion
project was predicated on a particular timetable; the evidence was that the rejection of the initial
clarifier submittals, as well as of the resubmittals, delayed this timetable. Evidence exists in the
record to support this finding; thus WesTech's no-evidence challenge fails. And after considering
all the evidence, we cannot say that this evidence, standing alone, is too weak to support the
finding or that this finding is manifestly wrong or unjust.
Finally, WesTech brings a sufficiency challenge to finding of fact no. 78, that
WesTech breached its contract by failing to supply equipment under the contract's terms and
conditions. Having determined that WesTech promised to meet the project specifications in the
contract documents, and having overruled all challenges to the decisions of the project engineer,
we find sufficient evidence to support the court's finding of WesTech's breach and to rebuff a no-evidence challenge. Further, we cannot say that this evidence is too weak to support this finding
or that the finding is so against the overwhelming weight of the evidence as to be manifestly
unjust. We overrule the fourth and seventh points of error. We likewise overrule points of error
nos. five, six, and twenty-two, finding no error in the trial court's conclusion of law no. 3 that
WesTech breached its contract with Clearwater by failing to supply clarifiers and DAF equipment
that met contract specifications.
Promissory Estoppel
In point of error twenty-one, WesTech argues that the trial court erred in
alternatively imposing liability under the doctrine of promissory estoppel. We believe that under
the terms of the UCC a contract was formed between WesTech and Clearwater, and we have
upheld the trial court's conclusion of law no. 1 to that effect. However, we find no error in the
trial court's alternative theory of liability under the doctrine of promissory estoppel. There is
testimony from Russ Wright that WesTech understood that Clearwater was seeking bids that
would comply with the City's plans and specifications for expansion of the Walnut Creek facility.
Two witnesses for Clearwater testified that Clearwater relied on WesTech's bid in formulating
and submitting its bid to the City. Clearwater provided further testimony that it relied upon the
provision that WesTech's equipment would be equal to project specifications. We find no error
in the court's conclusion of law no. 4 and overrule point of error twenty-one.
Mitigation of Damages
In points of error seventeen and eighteen, WesTech contends that Clearwater failed
to mitigate its damages by not requesting a change order from the City. It argues that Clearwater
could have avoided all its extra costs in purchasing the equipment from other suppliers by insisting
upon a change order to the City contract. WesTech relies on the following language in the City
contract, which provides that
[i]f the Engineer/Architect requires a change of any proposed Subcontractor . . .
previously accepted by them, the Contract amount shall be increased or decreased
by the difference in cost occasioned by such change and the appropriate change
order shall be issued . . . .
WesTech's reliance on this language is unpersuasive. First, the provision allows for a change
order only if the Engineer/Architect has "previously accepted" the subcontractor. CDM never
accepted WesTech's clarifiers or DAF equipment. Second, Mr. Rajandra Bhattarai, a City of
Austin engineer, testified that the City would not have granted a change order where a proposed
subcontractor is removed for failure to perform. The logic of WesTech's position is unpersuasive
in the context of commercial-construction contracts. Any increased costs resulting from the
default of a subcontractor should be absorbed by the general contractor, not the owner. We do
not interpret the language relied on by WesTech to force the City to pay for the increased costs
when a subcontractor defaults.
The testimony supports the trial court's finding of fact no. 83 that Clearwater
mitigated its damages, and we reject WesTech's challenge to the evidence supporting this finding.
We reject as well WesTech's complaint that the trial court improperly concluded that Clearwater
mitigated its damages. Points of error seventeen and eighteen are overruled.
Attorney's Fees
In its final point of error, WesTech complains of the trial court's award of
attorney's fees on appeal without conditioning the award on Clearwater's success on appeal.
Clearwater attempts to rely on the parties' stipulation as to the amount of attorney's fees, which
did not condition that amount on the success of an appeal. We agree with WesTech that any
award of attorney's fees on appeal must be conditioned on the receiving party's success. Smith
v. Smith, 757 S.W.2d 422, 426 (Tex. App. 1990, writ denied); Siegler v. Williams, 658 S.W.2d
236, 241 (Tex. App. 1983, no writ). We sustain appellant's twenty-third point of error that an
unconditional award of attorney's fees is erroneous as a matter of law. This error does not require
reversal, however. Rather, we modify the trial court's judgment to condition the award of
attorney's fees on appeal to Clearwater's success on appeal. See CPS Int'l. v. Harris &
Westmoreland, 784 S.W.2d 538, 544 (Tex. App. 1990, no writ).
Cross-Points
Clearwater asserts two cross-points of error complaining of the trial court's failure
to grant Clearwater consequential damages and certain expenses related to the prosecution of its
claim.
In its first cross-point, Clearwater contends that because of WesTech's breach,
Clearwater was forced to schedule a construction crane for an additional two months. Crane
rental expenses and related insurance, operator labor, fuel oil and maintenance and extended
overhead expenses amounted to $60,095.
Damages may be recovered when "loss is the natural, probable, and foreseeable
consequence of the defendant's conduct." Mead v. Johnson Group, Inc., 615 S.W.2d 685, 687
(Tex. 1981) (citing Hadley v. Baxendale, 9 Exch. 341, 354 (1854)). Further, speculative or
remote damages may not be recovered. A.B.F. Freight Sys. v. Austrian Import, 798 S.W.2d 606,
615 (Tex. App. 1990, writ denied); Roberts V. U.S. Home Corp., 694 S.W.2d 129, 135 (Tex.
App. 1985, no writ).
Three witnesses for Clearwater testified as to damages: Rick Minks, Clearwater's
superintendent; Steve Carrico, comptroller at Phelps, Inc., Clearwater's corporate parent; and
Lance Johnson, area manager for Clearwater. Minks testified that in his opinion, although the
crane and crew did not sit idle, there was a loss of efficiency in moving the equipment around to
make use of it. However, he was unable to give any specific examples of the crane's idleness or
of increased overhead costs directly attributable to WesTech's failure to supply the clarifiers.
Further, there were no notations in project logs indicating inefficiencies or improper use of the
cranes. Carrico gave detailed testimony on the rental and insurance expenses for two months of
crane rental. Johnson also gave evidence, but could not present any specific examples of
consequential damages.
We find Minks's testimony the most persuasive. Clearwater probably did incur
increased costs due to a loss of efficiency in the use of its crews. As his testimony shows, orderly
scheduling of construction crews is essential for efficient utilization. Having recognized this,
however, none of Clearwater's witnesses were able to tie specific additional expenses to
WesTech's breach of contract. Therefore, the trial court correctly denied consequential damages.
To award damages based on the evidence provided would be to speculate on their amount. We
overrule appellee's first cross-point.
Clearwater's second point of error is that it is entitled to recover $7,269 in
expenses related to the prosecution of its claim. Section nine of the purchase agreement provides
in part:
In any determination of damages directly attributed to failure or deficiency in the
performance of the vendor, it is agreed that vendee shall recover all damages it
may sustain, as well as all costs and attorney fees which may arise from the
enforcement of any suit for damages under this agreement.
(Emphasis added).
WesTech relies on language in the General Terms and Conditions of its original
bid proposal stating, "WesTech shall not be liable for any contingent, incidental or consequential
damages for any reason whatever." We note, however, that Wright's letter of December 16,
1987, did not object to consequential damages as an item of difference. We therefore hold that
the terms of the purchase agreement, not WesTech's General Terms and Conditions, control the
determination of this issue.
We are not persuaded, however, that the purchase-agreement provisions encompass
the costs Clearwater is seeking to recover. "Costs" generally do not include costs billed to the
client as part of the attorney's fee for services provided. Rather, costs usually refer to "[f]ees and
charges required by law to be paid to the courts or some of their officers, the amount of which
is fixed by statute or the court's rules; e.g. filing and service fees." Black's Law Dictionary, p.
312 (5th ed. 1979). We find no error in the court's decision to deny appellee's requested
litigation expenses which do not comport with the traditional definition of costs. We overrule the
second cross-point.
CONCLUSION
We sustain appellant's twenty-third point complaining of the trial court's
unconditional award of attorney's fees and modify the judgment to reflect an award of such fees
only upon success on appeal. As modified, we affirm the judgment of the district court.
Bea Ann Smith, Justice
[Before Justices Powers, Jones, and B. A. Smith; Justice Powers not participating]
Modified and, As Modified, Affirmed
Filed: July 1, 1992
[Publish]
1. In addition, when the appellate record contains specific findings of fact and conclusions
of law as well as a statement of facts, the reviewing court may review the legal conclusions
drawn from those facts in order to determine their correctness. Mercer v. Bludworth, 715
S.W.2d 693, 697 (Tex. App. 1986, writ ref'd n.r.e.); see also 4 Roy W. McDonald, Texas
Civil Practice in District and County Courts, § 16.10, at 35 (Frank W. Elliott ed., rev. ed.
1991).
2. Unless otherwise noted, all statutory cites are to this Act.
3. "Assuming that the transaction is between merchants and that there is nothing
communicated by the offeror triggering (2)(a) or (2)(c), the offeree's additional terms
ordinarily should become part of the contract. The offeree's burden under this analysis is a
light one indeed: all that the offeree must do in such a case to negate `material alteration' is
to establish that the term is common enough in the industry or in transactions between the two
parties to negate the possibility of the offeror's surprise . . . ." Brown, supra, at 936. | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1533862/ | 991 S.W.2d 768 (1999)
In re NOLO PRESS/FOLK LAW, INC., Relator.
No. 98-0724.
Supreme Court of Texas.
Argued October 21, 1998.
Decided April 15, 1999.
*769 R. James George, Peter D. Kennedy, Austin, for Relator.
James Donald Blume, Bretton C. Gerard, Dallas, Wesley V. Geary, Plano, J. Rodney Gilstrap, Marshall, Larry W. Lay, Austin, Clint W. Lewis, Beaumont, James N. Rader, Steven W. Young, Linda A. Acevedo, Austin, for Respondent.
Justice HECHT delivered the opinion of the Court, in which Chief Justice PHILLIPS, Justice OWEN, Justice BAKER, Justice HANKINSON, Justice O'NEILL, and Justice GONZALES join.
In this original proceeding, Nolo Press, Inc., a publisher of self-help legal books and computer software, petitions for a writ of mandamus compelling the Unauthorized Practice of Law Committee to produce documents and information related to the Committee's operations in general, and in particular, to its current investigation into whether certain of Nolo Press's publications constitute the unauthorized practice of law in Texas. Alternatively, Nolo Press requests clarification or modification of this Court's September 16, 1986 Order[1] that limits disclosure of Committee records. We hold that the Court lacks jurisdiction to grant the requested relief by mandamus, and that Nolo Press's petition should be treated in part as an administrative rather than a judicial matter. By administrative order issued today,[2] we vacate the Court's 1986 Order to permit disclosure of Committee records as provided by newly adopted Rule 12 of the Rules of Judicial Administration.[3]
I
We begin by describing the Unauthorized Practice Committee and then summarizing the events which have given rise to this proceeding.
A
The Supreme Court of Texas has inherent power to regulate the practice of law in Texas for the benefit and protection of the justice system and the people as a whole.[4] The Court's inherent power is *770 derived in part from Article II, Section 1 of the Texas Constitution, which divides State governmental power among three departments.[5] The authority conveyed to the Supreme Court by this constitutional provision includes the regulation of judicial affairs and the direction of the administration of justice in the judicial department.[6] Within this authority is the power to govern the practice of law.[7] The Court's inherent power under Article II, Section I to regulate Texas law practice is assisted by statute, primarily the State Bar Act.[8]
The practice of law in Texas is restricted to members of the State Bar, with limited exceptions permitted by this Court.[9] The "practice of law" is defined in the State Bar Act as:
the preparation of a pleading or other document incident to an action or special proceeding or the management of the action or proceeding on behalf of a client before a judge in court as well as a service rendered out of court, including the giving of advice or the rendering of any service requiring the use of legal skill or knowledge, such as preparing a will, contract, or other instrument, the legal effect of which under the facts and conclusions involved must be carefully determined.[10]
This statutory definition, however, is by its own terms "not exclusive and does not deprive the judicial branch of the power and authority under both this chapter and the adjudicated cases to determine whether other services and acts not enumerated may constitute the practice of law."[11] From time to time the Legislature has imposed civil and criminal penalties on the unauthorized practice of law.[12] Most recently, *771 in 1993, the Legislature made the unauthorized practice of law, defined somewhat differently in the Penal Code than in the State Bar Act, a Class A misdemeanor or, for multiple convictions, a third degree felony.[13]
The entity charged with policing the unauthorized practice of law is the Unauthorized Practice of Law Committee. The first such entity, the Committee on the Lay and Corporate Encroachment of the Practice of Law, was created in 1932 by the voluntary Texas Bar Association and its members appointed by the Association's president.[14] The Committee's sole purpose was to draft and urge enactment of a statute defining the practice of law and prohibiting the unauthorized practice. That goal having been accomplished in the 1933 legislative session,[15] the Committee was made a standing committee of the Bar Association with the name, the Committee on Unlawful Practice of the Law.[16] The Committee's purposes were enlarged to include informing local bar associations about the problems of the unauthorized practice of law, investigating possible violations of the new statute, and enforcing the statute by injunctions and criminal prosecutions.[17] Shortly after the integrated State Bar of Texas was formed in 1939,[18] this Court promulgated rules governing its operations, which called for local grievance committees to investigate and prosecute the unauthorized practice of law.[19] The State Bar also created a state committee on unauthorized practice to assist the local grievance committees, stimulate interest, and disseminate information.[20] The state committee was not a standing committee, however, and its role was largely advisory; investigation and prosecution of the unauthorized practice of law was left to local grievance committees.[21] Rules amendments adopted by the bar and approved by this Court in 1952 established the Unauthorized Practice of Law Committee as a permanent entity in the State Bar administration and gave the Committee investigative and prosecutorial powers, as well as the responsibility to inform the State Bar and others about the unauthorized practice of law.[22] In 1979, the Legislature amended the State Bar Act to require that members of the UPL Committee be appointed by this Court rather than by the president of the State *772 Bar.[23] Since then the Court has appointed Committee members.
By Order dated November 17, 1980,[24] the Court promulgated rules governing "the Unauthorized Practice of Law Committee for the State Bar of Texas". The Committee's duties are prescribed as follows:
The Committee shall keep the Court and the State Bar informed with respect to the unauthorized practice of law by laypersons and lay agencies and the participation of attorneys therein, and concerning methods for the prevention thereof. The Committee shall seek the elimination of the unauthorized practice by action and methods as may be appropriate for that purpose, including the filing of suits in the name of the Committee.[25]
Section 81.104 of the State Bar Act defines the UPL Committee's responsibilities similarly.[26] The UPL Committee is thus empowered, not to adjudicate whether activities constitute the unauthorized practice of law, but to seek adjudication of that issue in appropriate forums, and to provide information concerning such activities to this Court and the State Bar of Texas. To further these purposes, the Court's 1980 Order provides that the UPL Committee may adopt rules and procedures to guide its operations[27] and may subpoena witnesses and tangible evidence.[28] But the Committee has no authority to adjudicate whether a particular activity constitutes an unauthorized practice of law; indeed, the Order prohibits the Committee from issuing even advisory opinions concerning the unauthorized practice of law.[29]
Section 81.103 and the 1980 Order[30] both provide that the UPL Committee is comprised of nine members, at least three of whom must not be lawyers, appointed by this Court for staggered three-year terms. Members receive no monetary compensation for their service, but Section 81.103(f) and the 1980 Order[31] require the State Bar to pay the Committee's necessary and actual expenses. (The State Bar is, and is declared by statute to be, a public corporation and an administrative agency of the judicial department of government.[32]) Section 81.106 gives the UPL Committee and persons to whom it delegates authority immunity from liability "for any damages for an act or omission in the course of the official duties of the committee", and gives complainants and witnesses before the Committee the same immunity they would have in a judicial proceeding. The 1980 Order provides a similar grant of immunity.[33] Section 81.105 provides that the UPL Committee is not prohibited from using local subcommittees, and the 1980 Order expressly authorizes the appointment of subcommittees *773 of one or more persons.[34] Finally, this Court's September 16, 1986 Order prohibits disclosure of the Committee's records except for use in enforcement proceedings, to satisfy any requirements of the State Bar Act, to assist law enforcement agencies and prosecutors, and in furtherance of this Court's orders.[35]
The UPL Committee's authority to institute legal proceedings to prohibit the unauthorized practice of law is not exclusive. Such proceedings have been prosecuted by grievance committees,[36] local bar associations,[37] and groups of attorneys.[38] Criminal proceedings would ordinarily, of course, be conducted by criminal prosecuting attorneys.
B
In June 1997, the Chair of the Houston UPL Subcommittee wrote Nolo Press the following letter:
The Unauthorized Practice of Law Committee has received information that you may have engaged in activities which constitute the unauthorized practice of law. More specifically, it is our information that you have prepared and distributed to citizens of the State of Texas certain software and a User's Guide which represent that your forms as well as the suggested information to be inserted will properly affect legal rights. This software includes "Living Trust Maker2.0". Your activities, the representations made, the form of the presentations and other aspects of these programs may constitute the unauthorized practice of law.
The Unauthorized Practice of Law Committee is appointed by the Supreme Court of the State of Texas, and is charged by statute to enforce the State Bar Act. Persons not licensed by the Supreme Court as attorneys at law are prohibited from performing acts that constitute the practice of law.
You are requested to provide the undersigned investigator with a written response to the foregoing description of your activities in connection therewith. You are requested to include in your initial response the names, addresses and states of licensure of any attorneys who contributed to the contents of the software and/or User's Guide. Your written response should be received by me within ten (10) days of the date of this letter. Your failure to respond could mean that the Committee will consider the allegations and information before it without benefit of your reply.
You are entitled to be represented in this matter by an attorney of your own choosing. We look forward to your response.
The record before us reflects that Nolo Press responded to this letter, although the response is not included in the record.[39]
The next event evidenced in our record occurred in March 1998, when an investigator for the Dallas UPL Subcommittee wrote Nolo Press that he had been assigned to investigate the complaint initially considered by the Houston Subcommittee, and that the Dallas Subcommittee had scheduled a brief ("normally" thirty to forty-five minutes, according to the letter), informal hearing for August 20, 1998, "to *774 investigate and consider allegations that Nolo Press may have engaged in the unauthorized practice of law, as prohibited by [the State Bar Act]." The letter continued:
We request that an appropriate representative of Nolo Press attend that hearing. The failure of Nolo Press to have a representative present at the hearing could mean that the UPLC will consider the allegations and information before it without benefit of the information that such a representative could provide.
In response, Nolo Press requested additional information about the complaint, the investigation, and the hearing process, as well as more general information about the UPL Committee's activities and authority, all "[a]s part of deciding whether to appear" at the August hearing. The Dallas Subcommittee refused to provide Nolo Press information on complaints or possible witnesses against Nolo Press on the ground that such information was confidential. However, in answer to Nolo Press's other questions, the Subcommittee stated that investigatory hearings were informal and not open to the public, that testimony was not taken under oath, and that Nolo Press would be allowed to present evidence at the hearing subject to the discretion of the Subcommittee Chair. The Subcommittee added:
Neither the UPLC nor its Dallas Subcommittee has the power to ban anything. After the investigative hearing, the choices available to the Dallas Subcommittee are (i) to continue the investigation, or (ii) to close the file on the complaint, or (iii) to recommend to the UPLC that suit be filed to enjoin Nolo Press from engaging in whatever activities the Subcommittee believes constitute the unauthorized practice of law. The UPLC may accept or reject the Subcommittee's recommendation. If the Subcommittee recommends that an injunction suit be filed and the UPLC accepts that recommendation and authorizes the filing of such a suit, the suit will be filed in a court of competent jurisdiction.
[Two of your questions] imply that the UPLC or its Dallas Subcommittee has alleged, or has taken the position, that Nolo Press is engaged in the unauthorized practice of law. I hope you realize from some of the answers [provided in the letter] that neither the UPLC nor its Dallas Subcommittee has made any such allegations or taken any such position. We are merely investigating a complaint. We have not reached any conclusions or taken any position with respect to the activities of Nolo Press.
Nolo Press requested and received from the Clerk of this Court copies of the 1980 and 1986 Orders regarding the UPL Committee. Again, Nolo Press asked the Dallas Subcommittee to provide the details of the complaints against it, expressing its concern that an unfavorable decision had already been made and that "this hearing is just window dressing." The Subcommittee again refused to provide the requested information but explained:
[We are] sorry that you believe Nolo Press is not getting a fair shake and you believe the UPLC has made up its mind. We are interested in what Nolo Press has to say and the UPLC has not made any decision on filing suit to seek an injunction.
For clarification purposes, the process that we will follow is a hearing will be conducted to obtain information on whether any activities of Nolo Press, including the distribution of Living Trustmaker or other products, may constitute the unauthorized practice of law. After that hearing, the Dallas Subcommittee will then decide whether to dismiss the investigation, seek more information, or recommend to the State Unauthorized Practice of Law Committee that a lawsuit be filed to enjoin Nolo Press from unauthorized practice of law. The State Committee will then take up the matter and decide if suit should be authorized. If suit is not authorized, *775 there is no lawsuit; if suit is authorized, a lawsuit seeking injunctive relief will be brought in a court of competent jurisdiction. If a lawsuit is filed, the court will decide whether Nolo Press has committed unauthorized practice of law and whether injunctive relief is appropriate.
Please note the courts, not UPLC determine whether unauthorized practice of law has occurred and the relief, if any, to be afforded. Please be aware that the Texas legislature has defined what constitutes the practice of law. See TEX. GOV'T CODE ANN. § 81.101 (Vernon 1988).
(Emphasis in original.)
Nolo Press and the Dallas Subcommittee continued to exchange correspondence without resolving their differences. At one point, Nolo Press invoked the Public Information Act[40] in its request for information, but the Subcommittee refused the request on the ground that the Act does not apply to the judiciary.[41] Instead, the Subcommittee continued to rely on the 1986 Order in refusing to produce the information Nolo Press requested.
Four weeks prior to the scheduled August hearing, Nolo Press petitioned this Court for a writ of mandamus compelling the UPL Committee to produce the following information: the names of its subcommittee members; the dates, times, locations, agendas, and minutes of past and future meetings; copies of the Committee's internal rules and procedures; and all internal documents related to the Subcommittee's investigation of Nolo Press. Alternatively, Nolo Press requested the Court to "construe, clarify or modify" its 1986 Order to provide that "the UPL Committee is required to disclose to the public upon request the requested documents and information." We granted Nolo Press's petition and stayed the Subcommittee's hearing.[42]
II
Before we can consider whether Nolo Press is entitled to mandamus relief, we must first determine whether we have jurisdiction to issue such relief. Generally, the district court has exclusive original jurisdiction over mandamus proceedings except when the Constitution or a statute confers original jurisdiction on another tribunal.[43] This Court may entertain original mandamus proceedings only when jurisdiction is conferred by the Constitution or by statute.[44] Nolo Press asserts three bases for this Court's jurisdiction over this proceeding.
First, Nolo Press contends that jurisdiction lies under Article V, Section 3 of the Texas Constitution, which empowers this Court to issue writs of mandamus "as may be necessary to enforce its jurisdiction." But we have repeatedly construed this provision as authorizing the Court to issue writs only when a lower court's action threatens to impair our appellate jurisdiction or nullify the effect of our judgments.[45] No such threat is presented here, and therefore Article V, Section 3 does not confer jurisdiction over this proceeding.
Nolo Press next contends that jurisdiction lies under Section 22.002(a) of the *776 Government Code, which authorizes the Court to issue writs of mandamus against "any officer of state government except the governor". We have construed this phrase to refer, not to every State official at every level, but only to chief administrative officersthe heads of State departments and agencies who are charged with the general administration of State affairs.[46] Important as the UPL Committee members are, they are not within the small circle to which Section 22.002(a) refers. The UPL Committee is no different, in this respect, from other boards and commissions against which our original mandamus jurisdiction does not run.[47]
Finally, Nolo Press contends that jurisdiction lies under Article II, Section 1 of the Texas Constitution in combination with the provisions of the State Bar Act dealing with the UPL Committee. Article II, Section 1 requires a division of power among the three departments of State government. Nolo Press argues that because this Court appoints the UPL Committee and has inherent power to regulate the practice of law, it has jurisdiction to mandamus the Committee. The premises of this argument are true, but they do not support the conclusion. As we have previously held, "the Court's inherent powers, such as the power to regulate the bar, are administrative powers, not jurisdictional powers."[48] The Court's administrative powers imply no mandamus jurisdiction. It is true that those administrative powers necessarily include enforcement of the Court's regulations by order, and that such orders resemble writs of mandamus in that both may compel specific actions. But that one similarity does not equate the two kinds of directives. The bases for issuing a writ of mandamus are more restrictive than those for issuing an administrative order. "Mandamus issues only to correct a clear abuse of discretion or the violation of a duty imposed by law when there is no other adequate remedy by law."[49] Administrative orders direct action irrespective of whether there has been an abuse of discretion or a violation of a legal duty. Indeed, such orders are routinely used to set rules and policies for entities operating within the judicial department. We have not previously referred to such orders as writs of mandamus, or inferred mandamus jurisdiction from Article II, Section 1, and we decline to do so today.[50]
Accordingly, we conclude that we do not have jurisdiction to issue mandamus against the UPL Committee or any of its members on any basis Nolo Press asserts.
III
As an alternative to mandamus relief, Nolo Press urges that we consider its petition as an administrative matter and grant it essentially the same relief it seeks by mandamus, either by directing the UPL Committee to produce the information and materials Nolo Press has requested or by declaring that our 1986 Order does not preclude such production.
Whether we should treat a petition as an administrative rather than a judicial matter depends on the nature of the request and the availability of a judicial forum. In State Bar of Texas v. Gomez,[51]*777 we concluded that whether Texas attorneys should be compelled to provide free legal services to persons who cannot pay for them was an administrative matter. The plaintiffs in that case could not obtain the relief they sought unless this Court promulgated additional rules governing the State Bar. Promulgation of rules is clearly an administrative matter rather than a judicial one.[52] Furthermore, because only this Court could grant plaintiffs relief, plaintiffs' claims in the district court did not present a justiciable controversy, and hence that court had no jurisdiction to entertain them. We explained, however, that not
all remedies bearing upon the regulation of the legal profession would be unacceptable infringements on the inherent powers of the Court. Had this Court actually promulgated rules establishing a pro bono program and had Gomez challenged the constitutionality of such rules, the district court would have jurisdiction to decide, in the first instance, whether such rules met constitutional standards. See O'Quinn v. State Bar, 763 S.W.2d 397 (Tex.1988) (upholding the trial court's decision on a constitutional challenge to the rules of disciplinary conduct promulgated by the Court). In due course, we would review any adverse determination in our adjudicative capacity. See Cameron v. Greenhill, 582 S.W.2d 775, 777 & n. 3 (Tex. 1979) (holding that the Court could both promulgate a rule and determine its constitutionality). The important distinction between such a case and the one at hand is that in the former case, the district court would not be cast in the impermissible role of effectively promulgating policies and regulations governing Texas lawyers. Such a case would be justiciable because the district court would be capable of rendering a judgment that accords the parties complete relief, subject of course to appellate review.
But when, as here, the essence of a complaint is that this Court has failed to establish rules governing some aspect of lawyer conduct, a district court has no authority to assume this Court's authority to regulate the legal profession. This prohibition includes the rendition of orders that would, as a practical matter, preempt this Court's authority. Because the district court cannot effect a remedy that would resolve this dispute, this case does not present a justiciable controversy.[53]
In Chenault v. Phillips,[54] on the other hand, we held that a challenge to the attorney occupation tax[55] was a judicial matter, not an administrative matter, and that plaintiffs had a full remedy available in the district court. Distinguishing the case from Gomez, we explained:
Unlike the plaintiffs in Gomez, Relators do not seek imposition of new regulations on lawyers in Texas, but rather challenge the constitutionality of a statute that affects lawyers. Yet, as we noted in Gomez, constitutional challenges to rules enacted by this Court must be brought in district court and heard by this Court in the exercise of its appellate jurisdiction.... Analogously, Relators must follow the same procedure in challenging the constitutionality of the Attorney Occupation Tax. A litigant may not bring such a claim in the first instance in this Court.[56]
The attorney occupation tax, like all taxes, was imposed by the Legislature, not this Court. Although the Legislature has required *778 the Court to administer collection of the tax,[57] the Chenault plaintiffs' complaints were directed to the imposition and enforcement of the tax, not merely the manner of its collection. A constitutional challenge to a tax does not fall within this Court's administrative authority merely because the tax is on lawyers or the Court is the collector.
Gomez and Chenault illustrate the analysis we employ in determining whether to treat a petition as an administrative rather than a judicial matter. The matter in Gomez was clearly administrative, and plaintiffs could obtain the relief they sought in no forum other than this Court. In Chenault, by contrast, the matter was clearly judicial, and plaintiffs could obtain full relief in the district court and on appeal. Applying this same analysis to Nolo Press's request for the UPL Committee's records, we must determine whether Nolo Press's request should be addressed as an administrative matter, and whether Nolo Press has a judicial forum in which to assert its claims.
Whether the UPL Committee's records requested by Nolo Press are confidential is a judicial issue. Nolo Press argues that this Court's 1986 Order contravenes the Public Information Act,[58] various state constitutional provisions, and the common law. Recently in Commission for Lawyer Discipline v. Benton,[59] we considered a constitutional challenge to Rule 3.06(d) of the Texas Disciplinary Rules of Professional Conduct, a rule promulgated by this Court. The district court rejected the challenge, but the court of appeals sustained it, holding the rule unconstitutional. Nolo Press's challenge to this Court's 1986 Order is no less justiciable than the challenge in Benton to this Court's rule, and the appropriate initial forum for this challenge is the district court.
But Nolo Press not only argues that the UPL Committee's records are not confidential; it also argues that those records should not be confidential. That is, Nolo Press argues that even if our 1986 Order shields the UPL Committee's records from disclosure, the Order should be changed. This is not a justiciable issue for the district court, since that court cannot modify this Court's Order merely because it disagrees with the policies underlying the Order. The policy issue Nolo Press raises is purely an administrative matter which only this Court can address. Indeed, we have already done so in a broader context, while this proceeding has been pending, by promulgating Rule 12 of the Rules of Judicial Administration, governing the confidentiality of all judicial records, including the records of judicial agencies like the UPL Committee.[60] Rule 12 took effect April 1, 1999.[61]
Thus, Nolo Press's petition raises both justiciable and administrative issues. We could defer consideration of the administrative issues while Nolo Press asserted its challenges to our 1986 Order in the district court and under the procedures provided by Rule 12. Even when all those proceedings had run their course, however, the policy issues Nolo Press raises might remain unresolved. Because of our recent promulgation of Rule 12, and its change in the confidentiality of judicial records in general, we believe that the better course is to address those arguments of Nolo Press's that can be treated as an administrative matter concomitantly with this proceeding. Our administrative order issues with this opinion.
*779 * * * * *
Nolo Press's petition for mandamus is dismissed for want of jurisdiction. The Court's Order issued September 16, 1986, concerning the confidentiality of records of the Unauthorized Practice of Law Committee is vacated in Misc. Docket No. 99-9082.
Justice ENOCH filed a concurring opinion.
Justice ABBOTT did not participate in the decision.
APPENDIX I
IN THE SUPREME COURT OF THE STATE OF TEXAS
Order of the Court Approving Rules For The Unauthorized Practice of Law Committee
WHEREAS, the Unauthorized Practice of Law Committee is appointed by the Supreme Court of Texas; and,
WHEREAS, the Committee currently has no operating rules; and,
WHEREAS, a motion has been presented by the Chairman of the Unauthorized Practice of Law Committee, proposing alternative sets of rules; and,
WHEREAS, the Supreme Court of Texas has considered and approved the rules presented in alternative one,
IT IS, THEREFORE, ORDERED that the rules identified as "Exhibit A" and attached hereto and incorporated by reference be adopted.
By the court, en banc, in chambers, this 17th day of November, 1980.
s/ Joe R. Greenhill, Chief Justice
Zollie Steakley, Justice
Jack Pope, Justice
Sears McGee, Justice
James G. Denton, Justice
Charles W. Barrow, Justice
Robert M. Campbell, Justice
Franklin S. Spears, Justice
Will Garwood, Justice
[EXHIBIT A]
ARTICLE ____ UNAUTHORIZED PRACTICE OF LAW COMMITTEE
RULE NO. ____
The Supreme Court of Texas, pursuant to Tex.Rev.Civ.Stat. Ann. art. 320a-1, § 8 (1979) and pursuant to this Court's own inherent power to regulate and control the practice of law, promulgates the following Rules governing the activities of the Unauthorized Practice of Law Committee for the State Bar of Texas:
SECTION 1. Appointment of Committee
The Unauthorized Practice of Law Committee for the State Bar of Texas (hereinafter the "Committee") shall consist of nine (9) members appointed by the Supreme Court, three (3) of which members shall be nonlawyers. Members of the Committee shall serve for a term of three (3) years, except that the Supreme Court in making the first appointments to the Committee shall appoint three (3) members to serve an initial term of one (1) year, three (3) members to serve an initial term of two (2) years, and three (3) members to serve an initial term of three (3) years. All members of the Committee shall be eligible for reappointment. A chairperson of the Committee shall be designated each year by the Supreme Court.
SECTION 2. Duties of Committee
The Committee shall keep the Court and the State Bar informed with respect to the unauthorized practice of law by laypersons and lay agencies and the participation of attorneys therein, and concerning methods for the prevention thereof. The Committee shall seek the elimination of the unauthorized practice by action and methods as may be appropriate for that purpose, including the filing of suits in the name of the Committee.
*780 SECTION 3. Rules and Procedures
The Committee, in carrying out its duties, shall establish from time to time rules and procedures governing the activities of the Committee, which rules and procedures shall be approved by vote of two-thirds of the members of the Committee. Such rules and procedures shall include provision for the following:
a. investigation as deemed appropriate by the Committee or its delegees of complaints involving the possible unauthorized practice of law;
b. at a reasonable time prior to a decision by the Committee to commence litigation and/or other enforcement activity, notice to the subject of the complaint of the nature of the complaint and an opportunity for the subject of the complaint to respond to the complaint, unless providing such notice and/or such opportunity to respond in a particular case is determined by a majority of the Committee's quorum to prejudice unduly the Committee's enforcement activity and the public's interests;
c. determination by the Committee of the advisability of litigation and/or other enforcement activity in the name of the Committee necessary or appropriate for the elimination or prevention of the unauthorized practice of law;
d. recusal of individual Committee members and delegees in circumstances in which it would be improper or appear to be improper for the individual(s) to participate in a case before the Committee;
e. convening of regular meetings of the Committee, and the calling of special meetings and/or special mail ballotings;
f. establishment of a quorum as being a majority of the Committee, or in the case of a special mail balloting as being the casting of voted ballots by a majority of the Committee.
SECTION 4. Delegation of Powers
The Committee, acting through its Chairperson, may appoint subcommittees of one or more members of the State Bar of Texas and/or of other persons to carry out the Committee's duties of investigation. The Committee may also appoint counsel to act on its behalf in litigation and/or other enforcement activity. The Committee may not delegate its duty of making the final decision concerning against whom litigation and/or other enforcement activity shall be brought.
SECTION 5. Subpoena Power
The Committee or any member of the Committee authorized to act on behalf of the Committee shall have the power to subpoena witnesses and tangible evidence before the Committee or its subcommittees or delegees. If any witness, after such subpoena has been served, fails or refuses to appear before the Committee or its delegees, or to produce tangible evidence described in the subpoena, or refuses to be sworn or to testify, such witness may be compelled by a judge of any district court to appear, to testify and to produce such evidence.
SECTION 6. Bonds
The Committee shall not be required to post any bond upon the granting of a temporary restraining order, temporary injunction, or permanent injunction pursuant to any litigation filed by the Committee.
SECTION 7. Advisory Opinions
The Committee shall not issue advisory opinions concerning the unauthorized practice of law.
SECTION 8. Oath of Office
Each member of the Committee and each person acting as a delegee of the Committee shall take the following oath before the present chairperson of the Committee or the chairperson of the Committee for the immediately prior year, or any other person authorized by law to administer oaths:
I, ________, do solemnly swear (or affirm) that I will faithfully execute the duties of the office of a member (or delegee) of the Unauthorized Practice of *781 Law Committee for the Bar of the State of Texas, and will to the best of my ability preserve, protect, and defend the Constitution and laws of the United States and of this State; and I furthermore solemnly swear (or affirm), that I have not directly nor indirectly paid, offered, or promised to pay, contributed, nor promised to contribute any money, or valuable thing, or promised any public office or employment, as a reward to secure my appointment or the confirmation thereof. So help me God.
SECTION 9. Replacement of Members
In the event of death, disability, resignation or misconduct (including failure to participate in the Committee's activities) of a member of the Committee, the Supreme Court of Texas shall have the power to replace such member and to appoint a new member of the Committee to fulfill the term of office of the member so replaced.
SECTION 10. Immunity
The Committee, any member thereof, and any delegee thereof shall be immune from any suit for any conduct in the course of their official duties. Complainants and witnesses shall enjoy the same immunity in proceedings before the Committee as is accorded to complainants and witnesses in judicial proceedings.
SECTION 11. Expenses
The necessary and actual expenses of the Committee and its subcommittees or delegees shall be provided for and paid out of the budget of the State Bar of Texas.
APPENDIX II
IN THE SUPREME COURT OF THE STATE OF TEXAS
Supplemental Order to the November 17, 1980 Order
Adopting Rules for the Unauthorized Practice of Law Committee
WHEREAS, the Unauthorized Practice of Law Committee is appointed by the Supreme Court of Texas; and,
WHEREAS, the Committee currently operates pursuant to rules considered and approved and ordered adopted by the Supreme Court, in banc, in chambers of November 17, 1980; and
WHEREAS, The Committee in its work discharges its obligations on behalf of the Supreme Court;
IT IS, THEREFORE, ORDERED that the rule adopted as "Exhibit A" and attached hereto and incorporated by reference be adopted by the Court, in banc, in chambers, this 16 th day of September, 1986.
John L. Hill, Chief Justice
Sears McGee, Justice
Robert M. Campbell, Justice
Franklin S. Spears, Justice
C.L. Ray, Justice
James P. Wallace, Justice
Ted Z. Robertson, Justice
William W. Kilgarlin, Justice
EXHIBIT "A"
UNAUTHORIZED PRACTICE OF LAW COMMITTEE
Rule No.______
Section 12.
Said Committee shall keep all records, documents and other information of the Unauthorized Practice of Law Committee and its subcommittees (hereinafter referred to collectively as the "Committee") that are in its possession for the purposes of discharging its obligations in behalf of the Supreme Court confidential and shall release same only:
(1) For the Committee's use in enforcement proceedings to eliminate the unauthorized practice of law;
*782 (2) To satisfy all other requirements of the Committee pursuant to Tex.Rev. Civ. Stat. Ann. art. 320a-1, § 19;
(3) In response to proper requests of or to assist law enforcement agencies and prosecutors in the detection, investigation and prosecution of crimes; and
(4) In furtherance of any other orders from the Texas Supreme Court.
Justice ENOCH, concurring.
I only take issue with the Court's approach to this matter. The phrase "making a mountain out of a mole hill" comes to mind.
This Court is empowered to determine the qualifications of persons authorized to practice law in this state's courts.[1] With that power comes the necessary ancillary power to stop the unauthorized practice of law. The Unauthorized Practice of Law Committee is simply an entity that has the standing necessary to litigate whether one is practicing law without authority.[2] The UPL Committee has no independent regulatory power. Its power is that of any other plaintiffit can investigate whether to sue, and can bring a lawsuit. As well, Nolo Press, if sued, would have the power of any other defendantit could choose to defend and have discovery. If the UPL Committee decides to sue and if Nolo Press decides to defend, a court will decide the case. This is the entire matter. Yet the Court jumps the gun by entertaining Nolo Press's request for a writ of mandamus and elevating this case with the mantra of open records.
Why the Court jumps the gun troubles me. I cannot imagine under any similar circumstance that the Court would enable a potential defendant to pretermit a plaintiff's suit and the orderly application of the discovery rules through a mandamus action. This is particularly so because the legislature has empowered potential defendants to invoke the jurisdiction of the courts and the power of discovery through the device of declaratory judgment[3]a device, by the way, that Nolo Press evidently knows how to use.[4]
It also troubles me that we use this one case to alter an administrative rule that has been in effect for thirteen years. And we do so without any comment on the proposed changes from the UPL Committee members or any other interested persons. Nolo Press certainly is not the only one with an interest in the operation of the UPL Committee. Furthermore, I do not think it's fair to say that our comment period for Administrative Rule 12, which generally deals with judicial records, was fair notice that our previous specific order concerning the Unauthorized Practice of Law Committee was to be changed.[5] In fact, I'm confident the Court didn't even know that that order was under consideration. So how could our committee know at the time that this order was being reconsidered?
I agree that the request for mandamus should be dismissed because this Court doesn't have jurisdiction. While I also agree with much of what the Court says, the opinion serves only to build a mole hill into a mountain. The writ should be dismissed without further comment.
*783 APPENDIX
IN THE SUPREME COURT OF TEXAS
Misc. Docket No. 99-9082
IN RE PETITION OF NOLO PRESS, INC.
TO AMEND RULES GOVERNING THE UNAUTHORIZED PRACTICE OF LAW COMMITTEE
PER CURIAM
In Cause No. 98-0724, styled In re Nolo Press/Folk Law, Inc., relator Nolo Press, Inc., a publisher of self-help legal books and computer software, has petitioned for a writ of mandamus compelling the Unauthorized Practice of Law Committee of the State Bar of Texas to produce certain documents and information, and alternatively, for clarification or modification of this Court's September 16, 1986 Order[1] that limits disclosure of Committee records. In today's opinion in that case we deny mandamus relief and, for reasons there explained, conclude that Nolo Press's alternative request for clarification or modification of the 1986 Order should be treated as an administrative matter.[2] We here address that matter.
The 1986 Order makes all the UPL Committee's records confidential. Before considering modifications to this Order our usual procedure would be to call for comments from the Committee and all interested persons. That procedure has already been served last year, however, by the Judicial Council's lengthy study and several public hearings regarding disclosure of certain records and information possessed by courts and agencies in the Judicial Department. Although the study did not focus on the UPL Committee, all persons interested in the confidentiality and disclosure of records of all judicial agencies were invited to comment. The Court received no comments specifically related to the UPL Committee. Based on the Council's recommendations and public comments, the Court promulgated proposed Rule 12 of the Rules of Judicial Administration, subject to comments received prior to its effective date of April 1, 1999.[3] After receiving additional comments and making other changes, the Court has promulgated Rule 12.[4]
The UPL Committee is a "judicial agency" as defined by Rule 12.2(b), but because this Court's 1986 Order makes all the Committee's records confidential, Rule 12 does not apply to the Committee.[5] Rule 12 is designed to protect a judicial agency's records from public disclosure when its function would be compromised, and otherwise to make records available to the public on request. We see no reason why this rule should not apply to the UPL Committee as it would to any other judicial agency; indeed, one goal of Rule 12 is a uniform treatment for judicial records throughout the judicial department. Since the UPL Committee has no adjudicative power, all its records would be judicial records as defined by Rule 12.2(d).
Nolo Press has requested four categories of information and records: (1) the names of the UPL Committee's subcommittee members; (2) the dates, times, locations, agendas, and minutes of past and future meetings; (3) copies of the Committee's *784 internal rules and procedures; and (4) all internal documents related to the Subcommittee's investigation of Nolo Press. We cannot, of course, decide how Rule 12 would apply to specific records of the UPL Committee. We have not reviewed the Committee's records, nor is it for this Court to make such determinations in the first instance. Rule 12 provides a procedure for applying and enforcing its provisions. Rather, our concern is whether there is something about the UPL Committee's operations or records in general that should require treatment different from that afforded other judicial agencies whose functions must also be conducted with a degree of confidentiality. Neither Nolo Press's request, nor any factor considered by the Judicial Council of which we are aware, suggests that the UPL Committee must be treated uniquely.
Accordingly, we conclude that our 1986 Order should not insulate the UPL Committee's records from disclosure under Rule 12. Vacating that Order will place the UPL Committee under Rule 12.
IT IS THEREFORE ORDERED that the Court's September 16, 1986 Order relating to the Unauthorized Practice of Law Committee is vacated.
SIGNED AND ENTERED this 15th day of April, 1999.
/s/ Thomas R. Phillips
Thomas R. Phillips, Chief Justice
/s/ Nathan L. Hecht
Nathan L. Hecht, Justice
/s/ Craig T. Enoch
Craig T. Enoch, Justice
/s/ Priscilla R. Owen
Priscilla R. Owen, Justice
/s/ James A. Baker
James A. Baker, Justice
/s/ Greg Abbott
Greg Abbott, Justice
/s/ Deborah G. Hankinson
Deborah G. Hankinson, Justice
/s/ Harriet O'Neill
Harriet O'Neill, Justice
/s/ Alberto R. Gonzales
Alberto R. Gonzales, Justice
APPENDIX I
IN THE SUPREME COURT OF THE STATE OF TEXAS
Supplemental Order to the November 17, 1980 Order
Adopting Rules for he Unauthorized Practice of Law Committee
WHEREAS, the Unauthorized Practice of Law Committee is appointed by the Supreme Court of Texas; and,
WHEREAS, the Committee currently operates pursuant to rules considered and approved and ordered adopted by the Supreme Court, in banc, in chambers of November 17, 1980; and
WHEREAS, The Committee in its work discharges its obligations on behalf of the Supreme Court;
IT IS, THEREFORE, ORDERED that the rule adopted as "Exhibit A" and attached hereto and incorporated by reference by adopted by the Court, in banc, in chambers, this 16 th day of September, 1986.
s/ John L. Hill, Chief Justice
Sears McGee, Justice
Robert M. Campbell, Justice
Franklin S. Spears, Justice
C.L. Ray, Justice
James P. Wallace, Justice
Ted Z. Robertson, Justice
William W. Kilgarlin, Justice
EXHIBIT "A"UNAUTHORIZED PRACTICE OF LAW COMMITTEE
Rules No.______
Section 12.
*785 Said Committee shall keep all records, documents and other information of the Unauthorized Practice of Law Committee and its subcommittees (hereinafter referred to collectively as the "Committee") that are in its possession for the purposes of discharging its obligations in behalf of the Supreme Court confidential and shall release same only:
(1) For the Committee's use in enforcement proceedings to eliminate the unauthorized practice of law;
(2) To satisfy all other requirements of the Committee pursuant to Tex.Rev. Civ. Stat. Ann. Art. 320a-1, § 19;
(3) In response to proper requests of or to assist law enforcement agencies and prosecutors in the detection, investigation and prosecution of crimes; and
(4) In furtherance of any other orders from the Texas Supreme Court.
NOTES
[1] Supplemental Order to the November 17, 1980 Order Adopting Rules for the Unauthorized Practice of Law Committee (Tex. Sept. 16, 1986) (hereinafter "1986 Order") (infra, Appendix II).
[2] In re Petition of Nolo Press, Inc. to Amend Rules Governing the Unauthorized Practice of Law Committee, Misc. Docket No. 99-9082 (Tex. Apr. 15, 1999) (per curiam).
[3] Final Approval of Rule 12 of the Texas Rules of Judicial Administration and of Canon 3(C)(5) of the Code of Judicial Conduct, Misc. Docket No. 99-9058 (Tex. Mar. 24, 1999) (adopting Rule 12 of the Rules of Judicial Administration, effective April 1, 1999), reprinted in 62 TEX. BAR J. 450 (May 1999).
[4] See State Bar of Texas v. Gomez, 891 S.W.2d 243, 245 (Tex.1994); Unauthorized Practice Comm. v. Cortez, 692 S.W.2d 47, 51 (Tex. 1985). Cf. Sperry v. Florida, 373 U.S. 379, 383, 83 S. Ct. 1322, 10 L. Ed. 2d 428 (1963) (recognizing that a state has a "substantial interest in regulating the practice of law within the State"); Hexter Title & Abstract Co. v. Grievance Comm., 142 Tex. 506, 179 S.W.2d 946, 948 (1944) ("The State has a vital interest in the regulation of the practice of law for the benefit and protection of the people as a whole").
[5] Gomez, 891 S.W.2d at 245; Eichelberger v. Eichelberger, 582 S.W.2d 395, 398-399 (Tex. 1979) (holding that "[t]he inherent judicial power of a court is not derived from legislative grant or specific constitutional provision, but from the very fact that the court has been created and charged by the constitution with certain duties and responsibilities", and "also springs from the doctrine of separation of powers between the three governmental branches", "to enable our courts to effectively perform their judicial functions and to protect their dignity, independence and integrity.") (emphasis in original).
[6] Gomez, 891 S.W.2d at 245.
[7] Id. ("Because the admission and practice of Texas attorneys is inextricably intertwined with the administration of justice, the Court must have the power to regulate these activities in order to fulfill its constitutional role."). See also John L. Hill & David C. Kent, Administrative Law, 35 Sw. L.J. 465, 468-470 (1981).
[8] TEX. GOV'T CODE §§ 81.001-.114 (formerly TEX.REV.CIV. STAT. ANN. art. 320a-1); id. § 81.011(b) ("This chapter [the State Bar Act] is in aid of the judicial department's powers under the constitution to regulate the practice of law, and not to the exclusion of those powers."). All statutory references are to the Government Code unless otherwise noted.
[9] See TEX. GOV'T CODE § 81.102.
[10] Id. § 81.101(a).
[11] Id. § 81.101(b). Accord, Cortez, 692 S.W.2d at 51 ("independently of any statutory provisions as to what may constitute practice of law, the court has the duty and the inherent power to determine in each case what constitutes the practice of the law, and to inhibit persons from engaging in the practice of law without having obtained a license to do so" (quoting Grievance Comm. v. Coryell, 190 S.W.2d 130, 131 (Tex.Civ.App.Austin 1945, writ ref'd w.o.m.), and citing Grievance Comm. v. Dean, 190 S.W.2d 126, 128-129 (Tex.Civ.App.Austin 1945, no writ) (concluding that in regulating the practice of law, the Legislature acts "not to the exclusion of, nor in denial of, the constitutional powers of the judicial branch of the government"))).
[12] See Act approved Jan. 26, 1839, 3rd Cong., R.S., § 3, reprinted in 2 H.P.N. GAMMEL, THE LAWS OF TEXAS 1822-1897, at 136, 137 (Austin, Gammel Book Co. 1898) (imposing a $500 civil penalty on unlicensed practitioners for every case prosecuted or defended); Act approved May 12, 1846, 1st Leg., R.S., §§ 7, 9, reprinted in GAMMEL., supra, at 1551, 1553 (repealed 1879) (imposing a fine of $50 to $500 for every offense by an unlicensed practitioner, and authorizing any two or more practicing attorneys to institute prosecution); Act of May 31, 1933, 43rd Leg., R.S., ch. 238, 1933 Tex. Gen. Laws 835, repealed by Act of May 19, 1949, 51st Leg., R.S., ch. 301, 1949 Tex. Gen. Laws 548.
[13] TEX. PENAL CODE § 38.123. See also id. § 38.122 (prohibiting falsely holding oneself out as a lawyer); Satterwhite v. State, 979 S.W.2d 626 (Tex.Crim.App.1998) (affirming felony conviction under § 38.122 of an attorney suspended from practice for failing to timely pay his annual bar dues).
[14] Texas Bar Ass'n, Proceedings of the Fifty-First Annual Meeting of the Texas Bar Association, TEX. L.REV., Oct. 1932, at 152, 153-154, 169 (Texas Bar Ass'n Proceedings vol. 51).
[15] Act of May 31, 1933, 43rd Leg., R.S., ch. 238, 1933 Tex. Gen. Laws 835, repealed by Act of May 19, 1949, 51st Leg., R.S., ch. 301, 1949 Tex. Gen. Laws 548.
[16] Texas Bar Ass'n, Proceedings of the Fifty-Second Annual Meeting of the Texas Bar Association, TEX. L.REV., Oct. 1933, at 168, 173-174 (Texas Bar Ass'n Proceedings vol. 52).
[17] Id. at 173-174.
[18] Act of April 6, 1939, 46th Leg., R.S., ch. 1, 1939 Tex. Gen. Laws 64.
[19] TEX. STATE BAR RULES OF CONDUCT art. XII, § 35 (1940).
[20] See Melvin F. Adler, The Unauthorized Practice Committee Begins, 7 TEX. BAR J. 400 (1940).
[21] See, e.g., Hexter Title & Abstract Co. v. Grievance Comm., 142 Tex. 506, 179 S.W.2d 946 (1944) (holding that local grievance committee had standing to prosecute the unauthorized practice of law).
[22] 15 TEX. BAR J. 59, 65-66 (1952).
[23] Act of May 28, 1979, 66th Leg., R.S., ch. 510, § 19(b), 1979 Tex. Gen. Laws 1081, 1091.
[24] Order Approving Rules For The Unauthorized Practice of Law Committee (Tex. Nov. 17, 1980) (hereinafter "1980 Order") (infra, Appendix I).
[25] Id. § 2.
[26] "The unauthorized practice of law committee shall:
(1) keep the supreme court and the state bar informed with respect to:
(A) the unauthorized practice of law by lay persons and lay agencies and the participation of attorneys in that unauthorized practice of law; and
(B) methods for the prevention of the unauthorized practice of law; and
(2) seek the elimination of the unauthorized practice of law by appropriate actions and methods, including the filing of suits in the name of the committee."
[27] 1980 Order, § 3 (infra, Appendix I).
[28] Id. § 5.
[29] Id. § 7.
[30] Id. § 1.
[31] Id. § 11.
[32] TEX. GOV'T CODE § 81.011(a).
[33] 1980 Order, § 10 (infra, Appendix I).
[34] Id. § 4.
[35] 1986 Order (infra, Appendix II).
[36] E.g., Rattikin Title Co. v. Grievance Comm., 272 S.W.2d 948 (Tex.Civ.App.Fort Worth 1954, no writ).
[37] E.g., San Antonio Bar Ass'n v. Guardian Abstract & Title Co., 156 Tex. 7, 291 S.W.2d 697 (1956).
[38] E.g., Touchy v. Houston Legal Found., 432 S.W.2d 690 (Tex.1968) (concluding that practicing attorneys had standing to bring suit to enjoin the unauthorized practice of law).
[39] Nolo and the Committee both cite to Nolo's website, http://www.nolo.com for a list and the text of their correspondence.
[40] TEX. GOV'T CODE §§ 552.001-.353.
[41] Id. §§ 552.003(1)(B), 552.221(a).
[42] 41 TEX. SUP.CT. J. 1310 (Aug. 6, 1998).
[43] TEX. CONST. art. V, § 8; TEX. GOV'T CODE § 24.007; A & T Consultants, Inc. v. Sharp, 904 S.W.2d 668, 671-672 (Tex.1995).
[44] Chenault v. Phillips, 914 S.W.2d 140, 141 (Tex.1996) (per curiam).
[45] City of Orange v. Clark, 627 S.W.2d 146, 147 (Tex.1982) (per curiam); Stoner v. Massey, 586 S.W.2d 843, 846 (Tex.1979); Texas Aeronautics Comm'n v. Betts, 469 S.W.2d 394, 398-399 (Tex.1971); Sparenberg v. Lattimore, 134 Tex. 671, 139 S.W.2d 77, 78, 80 (1940); Hovey v. Shepherd, 105 Tex. 237, 147 S.W. 224, 224 (1912).
[46] Chemical Bank & Trust Co. v. Falkner, 369 S.W.2d 427, 430-31 (Tex.1963); Betts v. Johnson, 96 Tex. 360, 73 S.W. 4, 5 (1903).
[47] Superior Oil Co. v. Sadler, 458 S.W.2d 55, 55-56 (Tex.1970) (per curiam); Betts, 73 S.W. at 5.
[48] Chenault, 914 S.W.2d at 142.
[49] Walker v. Packer, 827 S.W.2d 833, 839 (Tex.1992) (quoting Johnson v. Fourth Court of Appeals, 700 S.W.2d 916, 917 (Tex.1985)).
[50] Cf. Jones v. Commission for Lawyer Discipline, 917 S.W.2d 4 (Tex.1995) (per curiam) (dismissing petition for writ of mandamus against the Commission for Lawyer Discipline, the Board of Law Examiners and its executive director, and the Clerk of this Court as moot without discussing jurisdiction).
[51] 891 S.W.2d 243 (Tex.1994).
[52] Cf. TEX. GOV'T CODE § 81.024 (recognizing that the Supreme Court may promulgate rules governing the State Bar).
[53] Gomez, 891 S.W.2d at 246.
[54] 914 S.W.2d 140, 142 (Tex.1996) (per curiam).
[55] TEX. TAX CODE §§ 191.141-.145.
[56] Id.
[57] TEX. TAX CODE § 191.1431.
[58] TEX. GOV'T CODE §§ 552.001-.353.
[59] 980 S.W.2d 425 (Tex.1998).
[60] See TEX.R. JUD. ADMIN. 12, published for comment in 61 TEX. BAR J. 994 (Nov.1998).
[61] Order of Final Approval of Rule 12 of the Texas Rules of Judicial Administration and of Canon 3(C)(5) of the Code of Judicial Conduct, Misc. Docket No. 99-9058 (Tex., Mar. 24, 1999), reprinted in 62 TEX. BAR J. 450 (May 1999).
[1] See TEX. GOV'T CODE § 81.061; see also State Bar of Texas v. Gomez, 891 S.W.2d 243, 245 (Tex.1994).
[2] See TEX. GOV'T CODE §§ 81.103-.104; Order Approving Rules For The Unauthorized Practice of Law Committee § 2 (Tex. Nov. 17, 1980) (supra, Appendix I).
[3] See TEX. CIV. PRAC. & REM.CODE §§ 37.002-.004.
[4] See Nolo Press/Folk Law, Inc. v. The Unauthorized Practice of Law Committee, No. 99-03252 (201 st Dist. Ct., Travis County, Tex., Mar. 17, 1999).
[5] See In re Petition of Nolo Press, Inc. to Amend Rules Governing the Unauthorized Practice of Law Committee, Misc. Docket No. 99-9082 (Tex. Apr. 15, 1999) (per curiam).
[1] Supplemental Order to the November 17, 1980 Order Adopting Rules for the Unauthorized Practice of Law Committee (Tex. Sept. 16, 1986) (hereinafter "1986 Order") (infra, Appendix I).
[2] In re Nolo Press/Folk Law, Inc., 991 S.W.2d 768 (Tex.1999).
[3] Order Approving Revisions to the Texas Rules of Judicial Administration, Misc. Docket No. 98-9170 (Tex., Oct. 8, 1998), reprinted in 61 TEX. BAR J. 994 (Nov.1998).
[4] Order of Final Approval of Rule 12 of the Texas Rules of Judicial Administration and of Canon 3(C)(5) of the Code of Judicial Conduct, Misc. Docket No. 99-9058 (Tex., Mar. 24, 1999), reprinted in 62 TEX. BAR J. ___ (May 1999).
[5] TEX.R. JUD. ADMIN. 12.3(a). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1533909/ | 273 B.R. 416 (2002)
In re Robert Helfrich KEELER.
Robert Helfrich Keeler,
v.
Academy of American Franciscan History, Inc., et al.
CIV. A. No. DKC 2001-0888.
United States District Court, D. Maryland.
February 14, 2002.
*417 Terri Lynn Sneider, Law Office, Annapolis, MD, for Robert Helfrich Keeler.
Patrick C. McKeever, Miller, Miller & Canby, Rockville, MD, for Academy of American Franciscan History, Inc.
MEMORANDUM OPINION
CHASANOW, District Judge.
This case is before the court on appeal from the order of Bankruptcy Judge Duncan Keir denying Appellant Robert Helfrich Keeler's motion under Fed.R.Civ.P. 59(e) for reconsideration or, in the alternative, for new trial. Presently pending and ready for resolution in this case are 1) Appellee Academy of American Franciscan History, Inc.'s renewed motion to dismiss the appeal, 2) Appellee's motion to stay the appeal pending the outcome of Appellant's appeal to the Court of Special Appeals of Maryland and 3) Appellant's appeal from the denial of his motion to reconsider or *418 for new trial on the grounds that new evidence demonstrated that the state court charging order at issue was not a proper final state court judgment and so should have been reviewed by the bankruptcy court.[1] In light of the Maryland Court of Special Appeals' resolution of Appellant's state appeal, Appellee's motion to stay the present appeal is moot. Oral argument is deemed unnecessary because the facts and legal arguments are adequately presented in the briefs and record, and the decisional process would not be significantly aided by oral argument. See Bankr.Rule 8012. For reasons that follow, the court will deny Appellee's motion to dismiss, but affirm the bankruptcy's court's denial of Appellant's motion to reconsider.
I. Background
The following facts are uncontroverted. Both parties agreed in their pleadings and in the hearing before the bankruptcy court that there is no dispute of material fact, In re Keeler, 257 B.R. 442, 445 (Bankr.D.Md.2001), and Appellant has not appealed any of the bankruptcy court's factual findings.
Appellant commenced his original bankruptcy case by voluntary petition under Title 7 of the United States Bankruptcy Code on December 20, 1999. Schedule B filed with his petition listed a partnership interest in Gaither Road Partnership which owned an interest in the 370 Limited Partnership (hereinafter "Partnership Interests"). One of the unsecured creditors of this partnership was Appellee. on May 11, 2000, a discharge order was entered and on June 27, 2000, the Chapter 7 Trustee filed a report of no distribution. On July 20, 2000, a final decree was entered and the bankruptcy case was administratively closed.
On August 17, 2000, Appellant requested a reopening of the bankruptcy case because he alleged that Appellee attempted to collect income on account of the partnership interests pursuant to a charging order entered by the Circuit Court for Montgomery County prior to the bankruptcy. Appellant alleged that this charging order had been terminated by the bankruptcy discharge and so Appellee had no right, post bankruptcy petition, to the income it collected pursuant to that charging order.
In the case before the bankruptcy court, Appellant argued that the charging order was not an assignment of property interests or a lien upon his property. Instead, he argued that it was akin to a garnishment of wages (future income) and, thus, the charging order did not survive satisfaction of the debt. Because the debt was satisfied upon its discharge in bankruptcy court, Appellant asserted that Appellee had no further right to obtain income payable to the partnership interests after that discharge.
Holding that "[t]he nature of interests acquired pre-petition by the entry of the charging order must be determined by *419 applicable state law," In re Keeler, 257 B.R. at 447, citing Butner v. United States, 440 U.S. 48, 55, 99 S. Ct. 914, 59 L. Ed. 2d 136 (1979) ("Property interests are created and defined by state law."); see also American Bankers Ins. Co. of Florida v. Maness, 101 F.3d 358, 363 (4th Cir.1996), the bankruptcy court analyzed the charging order under Maryland law to determine whether it was a mere garnishment of Appellant's future income or whether a property interest was transferred.
The nature of the property interest in the charging order was critical because Appellant argued that a garnishment of future income can have no effect post-bankruptcy discharge. A pre-petition lien against property, on the other hand, is not automatically avoided by the filing of the bankruptcy petition. "Unless otherwise addressed by orders entered in the bankruptcy case, pre-petition liens held by creditors `ride though' the bankruptcy unscathed." Keeler, 257 B.R. at 446, citing Dewsnup v. Timm, 502 U.S. 410, 416, 112 S. Ct. 773, 116 L. Ed. 2d 903 (1992); Cen-Pen Corp. v. Hanson, 58 F.3d 89, 92-93 (4th Cir.1995).
The court ruled that while the bankruptcy had discharged Appellant's personal liability for debts owed to Appellee, the charging order had been unaffected by the bankruptcy and remained a lien upon property captured before the case had been commenced. Further, it ruled that the Rooker-Feldman doctrine (as well as res judicata) barred it from reviewing final orders of a state court with competent jurisdiction and so the court could not consider Appellant's challenges to the validity of the charging order.
On his motion for reconsideration or, in the alternative, for a new trial, Appellant did not challenge the bankruptcy court's legal conclusion that the charging order acted as a lien against property and so "rode though" the bankruptcy. Instead, Appellant claimed to have "newly discovered evidence" that the state court was without jurisdiction to grant the charging order; particularly alleging that he was never properly served in accordance with Maryland law. Paper no. 1, Appellant's Appendix, Motion for Reconsideration. Accordingly, he contended that the charging order was not a proper "final order" and so neither res judicata nor the Rooker-Feldman doctrine should prevent the bankruptcy court from reviewing it to determine whether the Montgomery County Circuit Court has jurisdiction to issue it.
The bankruptcy court denied Appellant's motion on the ground that the state court's charging order is no less a final judgment just because Appellant challenges its underlying validity. Appellant appeals from this denial, arguing that it was an abuse of discretion for the bankruptcy court not to review the charging order and that Rooker-Feldman should not apply.
II. Standard of Review
On appeal from the bankruptcy court, the district court acts as an appellate court and reviews the bankruptcy court's findings of fact for clear error and conclusions of law de novo. In re Deutchman, 192 F.3d 457, 459 (4th Cir.1999) (internal citations omitted). See also In re Kielisch, 258 F.3d 315, 319 (4th Cir.2001) ("[W]e review findings of fact for clear error and conclusions of law de novo.") On appeal, the court, "review[s] the denial of a motion to alter or amend under Fed R. Civ. P. 59(e) for abuse of discretion." Collison v. International Chemical Workers Union, Local 217, 34 F.3d 233 (4th Cir.1994), citing Temkin v. Frederick County Comm'rs, 945 F.2d 716, 724 (4th Cir.1991), cert. denied, 502 U.S. 1095, 112 S. Ct. 1172, 117 L. Ed. 2d 417 (1992); see *420 also Pacific Insurance Co. v. American National Fire Ins. Co., 148 F.3d 396, 403 (4th Cir.1998). In considering Appellant's motion, the bankruptcy judge applied the standard recognized by the Fourth Circuit that there are three grounds for amending an earlier judgment pursuant to Rule 59(e): "(1) to accommodate an intervening change in controlling law; (2) to account for new evidence not available at trial; or (3) to correct a clear error of law or prevent manifest injustice." Pacific Insurance, 148 F.3d at 403, citing EEOC v. Lockheed Martin Corp., Aero & Naval Sys., 116 F.3d 110, 112 (4th Cir.1997); Hutchinson v. Staton, 994 F.2d 1076, 1081 (4th Cir.1993). Appellant does not challenge the bankruptcy court's application of this standard when considering his Rule 59(e) motion. Hence, the district court reviews the bankruptcy court's denial of Appellant's motion only for abuse of discretion in failing to take into account relevant factors or acting on the basis of "`legal or factual misapprehensions' respecting these factors." Pacific Insurance, 148 F.3d at 402, 403, quoting James v. Jacobson, 6 F.3d 233, 242 (4th Cir.1993).
III. Analysis
Appellant appeals on the ground that the bankruptcy court allegedly abused its discretion by declining to review whether the state court charging order was a proper final judgment despite new "evidence" that the state court lacked jurisdiction over the matter. Specifically, Appellant challenges the application of the Rooker-Feldman doctrine, which holds that lower federal courts lack jurisdiction to review final state court decisions. See District of Columbia Court of Appeals v. Feldman, 460 U.S. 462, 482, 103 S. Ct. 1303, 75 L. Ed. 2d 206 (1983); Rooker v. Fidelity Trust Co., 263 U.S. 413, 416, 44 S. Ct. 149, 68 L. Ed. 362 (1923). Appellant argues that because the state charging order is allegedly void, Rooker-Feldman, as well as doctrines of preclusion, do not apply to bar the bankruptcy court from reviewing that charging order. Paper no. 1, Appellant's Brief, at 6. Appellee, on the other hand, contends in its motion to dismiss that the decision of the Court of Special Appeals of Maryland upholding the state charging order against Appellant's jurisdictional challenge renders Appellant's appeal moot and merits dismissal of the appeal. Paper no. 14. Therefore, the court's determination of whether the bankruptcy court correctly declined to review the validity of the state charging order because it lacked jurisdiction under Rooker-Feldman will determine both whether the bankruptcy court abused its discretion and whether the Maryland Court of Special Appeals decision is relevant to this appeal and so grounds for dismissal.
A. Rooker-Feldman
The Rooker-Feldman doctrine creates a jurisdictional obstacle to collateral review of final state court judgments in federal court. This doctrine "rests on the principle that district courts have only original jurisdiction; the full appellate jurisdiction over judgments of state courts in civil cases lies in the Supreme Court of the United States . . ." GASH Associates v. Village of Rosemont, Illinois, 995 F.2d 726, 728 (7th Cir.1993). "The doctrine prohibits the United States District Courts, with the exception of habeas corpus actions, from `sit[ting] in direct review of state court decisions.'" Jordahl v. Democratic Party of Virginia, 122 F.3d 192, 199 (4th Cir.1997), quoting Feldman, 460 U.S. at 483 n. 16, 103 S. Ct. 1303. Accordingly, the bankruptcy court would not have subject matter jurisdiction over claims barred by Rooker-Feldman.
Appellant argues that the state charging order was void because, among *421 other things, there was never effective service of process and so is not a valid final judgment for the purposes of Rooker-Feldman. Because the state charging order is void, Appellant argues, it should be given no preclusive effect. However, Rooker-Feldman is not a doctrine of preclusion, but of jurisdiction. See GASH, 995 F.2d at 728 (The Rooker-Feldman doctrine has nothing to do with the Full Faith and Credit Statute, 28 U.S.C. § 1728, which requires the federal court to give the same preclusive effect to state court judgments as the rendering state would).
Appellant contends that Rooker-Feldman should not apply where the state court had no jurisdiction to render the charging order. However, there is no procedural due process exception to the Rooker-Feldman doctrine for the argument that there was not a fair opportunity to be heard on the merits in state court, nor for state judgments that do not qualify as final judgments on the merits. "If the state trial court erred . . . relief was available in the appellate courts of Minnesota." In re Goetzman, 91 F.3d 1173, 1177-78 (8th Cir.1996), cert. denied, 519 U.S. 1042, 117 S. Ct. 612, 136 L. Ed. 2d 537 (1996).
There is a split among the circuits as to whether there is a narrow exception to Rooker-Feldman for state judgments that are void ab initio. Most circuits recognize no exception and agree with GASH, 995 F.2d at 728, that the only federal review of a final state order lies with the Supreme Court, after the debtor has exhausted state appellate rights. See also In re Ferren, 203 F.3d 559 (8th Cir.2000) (bankruptcy court lacks jurisdiction under Rooker-Feldman to void a state court decision). Some circuits, however, recognize a limited exception. See In re Pavelich, 229 B.R. 777, 781-83 (9th Cir. BAP 1999) (bankruptcy court can override state court judgment to extent that state court construes the bankruptcy discharge incorrectly because such judgment is void ab initio under Bankruptcy Code section 524(a)(1)[2]); see also In re Dabrowski, 257 B.R. 394 (Bankr.S.D.N.Y.2001) (exception when state court judgment entered is void because the claim underlying the judgment is discharged in bankruptcy). The Fourth Circuit has not spoken on this issue.
This exception would be inapplicable in the current case in any event. First, the exception is only raised in cases where the state court and bankruptcy court have concurrent jurisdiction over some liability of a debtor that is the subject of a bankruptcy discharge. Specifically, Section 524(a), the source of this exception to Rooker-Feldman where it is recognized, voids the state judgment to the extent that it is a determination of personal liability with respect to a debt discharged in the bankruptcy. Here, the pre-petition charging order at issue was not a personal liability, but a liability of the partnership and was not, in any case, discharged in the bankruptcy by the determination of the bankruptcy court. Even in the context of concurrent jurisdiction, a bankruptcy court in this circuit not only refused to recognize an exception, but assailed the reasoning of the Ninth Circuit in Pavelich, stating that, "[o]nce the debtors choose a forum and that court renders judgment, the debtors cannot then run to the other forum if the result is incorrect." In re Toussaint, 259 B.R. 96, 102 (Bankr.E.D.N.C.2000). Moreover, that bankruptcy court stated:
*422 ... once that state court exercises concurrent subject matter jurisdiction and renders judgment, the state court judgment is at worst erroneous, not void ab initio, and the bankruptcy court lacks jurisdiction to collaterally attack the decision. The only way a bankruptcy court could procedurally review that judgment would be to, in effect, sit as an appellate court over the state trial court. This is exactly what the Rooker-Feldman doctrine prohibits.
Id., at 102-103. Therefore, there is no exception to Rooker-Feldman recognized in the Fourth Circuit that would be applicable to the current case.
B. Motion to Dismiss
Appellee asserts that the Maryland Court of Special Appeals' recent ruling in its favor satisfies any doubts as to the validity of the charging order that is challenged on appeal by Appellant. However, because of Rooker-Feldman, whether a state appellate court upheld the trial court's ruling is irrelevant to any error by the bankruptcy court because the bankruptcy court could not review the validity of that original charging order whether it was appealed or not. Accordingly, Appellee's motion to dismiss is denied.
C. Merits of the Appeal
Appellant appeals the denial of his motion to reconsider or, in the alternative, for a new trial. The substance of his claim is that the bankruptcy judge abused his discretion by denying the motion to reconsider after appellant presented "newly discovered evidence" allegedly demonstrating that the state court was without jurisdiction to render the charging order at issue in the bankruptcy court's decision. As demonstrated above, apart from a limited circumstance in some circuits, there is no exception to the Rooker-Feldman doctrine for challenges to state court rulings predicated on jurisdictional concerns. See GASH, 995 F.2d at 728; Goetzman, 91 F.3d at 1177-1178. Furthermore, the Court of Special Appeals of Maryland did affirm the Montgomery County Circuit Court decision at issue, denying Appellee's contentions that the lower court lacked jurisdiction to grant the charging order. Though the failure of Appellant's state court appeal is irrelevant given Rooker-Feldman, it suggests that Appellant suffered no prejudice from the bankruptcy court's refusal to review the charging order and even more strongly supports the notion underlying Rooker-Feldman that lower federal courts cannot sit in appellate review of state courts. Because Appellant appeals only the Rule 59(e) motion to reconsider, the district court reviews only for abuse of discretion. Finding none, we AFFIRM.
IV. Conclusion
The bankruptcy court lacks jurisdiction under the Rooker-Feldman doctrine to review state court judgments, even for alleged jurisdictional deficiencies, and so did not abuse its discretion in declining to review the validity of a Maryland state court charging order. The operation of Rooker-Feldman renders the resolution of a state court appeal irrelevant to the question raised on appeal before this court. Accordingly, Appellee's motion to dismiss is DENIED, but the bankruptcy court's denial of Appellant's motion to reconsider or, in the alternative, for new trial, is AFFIRMED.
NOTES
[1] In his brief, Appellant also contends that the bankruptcy court erred in ruling that a pre-petition lien against property captured before the bankruptcy "rides through" the bankruptcy unscathed and is not automatically discharged by the bankruptcy. However, Appellant only appeals from the Bankruptcy court's denial of his Rule 59(e) motion for reconsideration of its previous order denying relief to Appellant, or for new trial, not from the merits of the first order itself. Appellant's motion to reconsider was predicated not on a challenge to the Bankruptcy court's legal determination regarding the status under Maryland law of a pre-petition charging order, but on a challenge to the legality of that charging order itself. Hence, only the question of whether the bankruptcy court abused its discretion by not reviewing the legality of the state court charging order is properly before this court on appeal.
[2] Bankruptcy Code section 524(a)(1) sets forth the effect of a discharge in bankruptcy and states, in pertinent part, that a discharge, "voids any judgment at any time obtained to the extent that such judgment is a determination of the personal liability of the debtor with respect to any debt discharged under Section 727 . . . of this title." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1533964/ | 991 S.W.2d 14 (1997)
CITY OF AMARILLO and the City of Amarillo Civil Service Commission, Appellants,
v.
Mark GLICK, Jerome Godfrey, Douglas Heaster, Douglas Herrington and Darrell Wirtz, Appellees.
No. 07-96-0160-CV.
Court of Appeals of Texas, Amarillo.
December 8, 1997.
Rehearing Overruled February 5, 1998.
*15 Merrill E. Nunn, Claud H. Drinnen, III, Amarillo, for appellant.
Jeff Blackburn, Amarillo, for appellee.
Before BOYD, C.J., and DODSON and REAVIS, JJ.
DODSON, Justice.
In this appeal, the City of Amarillo and its Civil Service Commission (the City) are the appellants and Marty Glick, Jerome Godfrey, Douglas Heaster, Douglas Herrington, and Darrell Wirtz (the police officers) are the appellees. On appeal, the City challenges that portion of the trial court's judgment awarding the police officers attorney's fees and costs as the prevailing parties in their action to set aside the Civil Service Commission's determination in the police officers' appeal to the Commission concerning a police corporal *16 promotion examination conducted by the City. We affirm.
The record shows that all of the police officers took the corporal promotion examination and failed, with the exception of Herrington, who did not take the exam. Thereafter, the officers appealed to the Civil Service Commission, claiming the examination was conducted unlawfully because of improper notice and for other reasons. However, the Commission determined:
... that due to the lack of Civil Service jurisdiction, the Commission takes no action regarding the Corporal promotional examination and resulting eligibility roster as appealed and requested by Police Officers....
After the Commission's determination, the police officers timely filed their appeal and action in the district court. After a bench trial, the Court, among other things ordered that:
... the corporals' promotional examination given on August 2, 1995, by the City of Amarillo Civil Service Commission, and any resulting scores or eligibility lists, except as to those officers who passed said examination, are VOID;
* * * * *
... as the prevailing party, Plaintiffs [i.e., the police officers] are entitled to reasonable attorney's fees in the amount of ELEVEN THOUSAND ONE HUNDRED AND TWENTY-FIVE and NO/ 100 Dollars ($11,125.00).
The record further shows that the City requested the trial court to make findings of facts and conclusions of law. Among other things, the trial court found that:
1. The Plaintiffs [i.e., the police officers] timely filed their appeals to the Civil Service Commission.
2. The Plaintiffs [i.e., the police officers] timely filed their appeal to this court.
3. This court has jurisdiction.
4. The Civil Service Commission's decision concerning the officers' appeals was not supported by substantial evidence.
5. The Civil Service Commission's ruling was not free of the taint of illegality.
6. The Civil Service Commission's ruling was not reasonable.
7. The attorney's fees and expenses awarded to the Plaintiffs [i.e., police officers] were necessary and are reasonable.
The City's appeal to this court is limited. By its sole point of error, the City claims only that the police officers are not entitled to attorney's fees because they were not the "prevailing party" in the lawsuit.[1] We disagree.
Initially, we point out that attorney's fees are not recoverable in an action unless provided for by statute or by contract between the parties. First Nat'l Bank of Commerce v. Anderson Ford-Lincoln-Mercury, Inc., 704 S.W.2d 83, 85 (Tex.App.Dallas 1985, writ. ref'd. n.r.e.) Section 143.015(c) of the Texas Local Government Code provides that upon appeal of a commission decision to a district court, "The court may award reasonable attorney's fees to the prevailing party and assess court costs against the nonprevailing party." Tex. Loc. Gov't.Code Ann. § 143.015(c). The award of attorney's fees and costs under § 143.015 is within the district court's discretion. City of Sherman v. Henry, 928 S.W.2d 464, 474 (Tex. 1996).
Because the award of attorney's fees rests in the sound discretion of the trial court, the judgment will not be reversed on appeal without a clear showing *17 of abuse of discretion. City of Sherman v. Henry, 928 S.W.2d at 474. A trial court abuses its discretion when it acts arbitrarily or unreasonably, or without reference to any guiding rules and principles. Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex.1985), cert. denied, 476 U.S. 1159, 106 S. Ct. 2279, 90 L. Ed. 2d 721 (1986). The fact that a trial judge decided a matter within the judge's discretionary authority differently from how an appellate court might decide the matter under the same circumstances does not establish abuse of discretion. Downer v. Aquamarine Operators, Inc., 701 S.W.2d at 242.
Also, we further note that our research has revealed no reported Texas cases dealing with the definition of "prevailing party" as that phrase is found in § 143.015(c) of the Local Government Code. However, the cases construing the same phrase under Chapter 38 of the Civil Practice and Remedies Code and under Texas Rule of Civil Procedure 131 have consistently applied the same definition and analysis to the phrase. Accordingly, we look to those cases for guidance.
A prevailing party is "one of the parties to a suit who successfully prosecutes the action or successfully defends against it, prevailing on the main issue, even though not to the extent of its original contention." F.D.I.C. v. Graham, 882 S.W.2d 890, 900 (Tex.App.Houston [14th Dist.] 1994, no writ) (quoting Criton Corp. v. the Highlands Ins. Co., 809 S.W.2d 355, 357 (Tex.App.Houston [14th Dist.] 1991, writ denied)); Weng Enterprises v. Embassy World Travel, 837 S.W.2d 217, 222-23 (Tex.App.Houston [1st Dist.] 1992, no writ). Determination of whether a party is the prevailing or successful party must be based upon success on the merits, and not on whether or not damages were awarded. Scholl v. Home Owners Warranty Corp., 810 S.W.2d 464, 468 (Tex.App.San Antonio 1991, no writ); Perez v. Baker Packers, 694 S.W.2d 138, 143 (Tex.App.Houston [14th Dist.] 1985, writ ref'd n.r.e.). In other words, a prevailing party is one who is vindicated by the trial court's judgment. Dear v. City of Irving, 902 S.W.2d 731, 739 (Tex.App.Austin 1995, writ denied).
As stated above, the main issue in the appeal before the district court was whether or not the Commission's decision that it did not have jurisdiction to act was lawful. The district court expressly found that the decision was not supported by substantial evidence, was not "free of the taint of illegality," and was not reasonable. In its judgment, the district court overturned the Commission's decision by acting to declare the exam results partially void.
The police officers, basically, wanted their test scores set aside and a new test administered in order to be considered for the promotion of corporal. The trial court's January 19, 1996 judgment determined that "the corporals' promotional examination given on August 2, 1995, by the City of Amarillo Civil Service Commission, and any resulting scores or eligibility lists, except as to those officers who passed said examination, are VOID." Accordingly, the police officers were vindicated by the judgment, although not to the extent of their original contentions.
In support of its position, the City claims that the police officers did not obtain any of the relief that they sought in the trial court and, therefore, they were not the successful or prevailing parties. Again, we disagree.
We reiterate that under the cases discussed above, the police officers need not receive all of the relief which they sought in order to prevail on their actions in the trial court. They need only to obtain a judgment which mandates that they were right on the main issue in the case. In this instance, the Commission determined that it had no jurisdiction to take action on the police officers' appeal. However, the trial court found, by its unchallenged conclusions, that the Commission's decision was not supported by substantial evidence, *18 was not "free of the taint of illegality," and was not reasonable. Furthermore, the trial court determined that the corporal's promotion examination in question and any resulting scores or eligibility lists were void except as to those officers who passed the exam.
It is undisputed that none of the police officer appellees passed the exam. Thus, the effect of the trial court's determination is that the exam was void as to the police officer appellees. Therefore, we conclude that the police officers prevailed on the main issue in the case, even though they did not receive all of the relief they requested.
Consequently, we conclude that the City has failed to show that the trial court abused its discretion in awarding attorney's fees and costs to the police officers as the "prevailing parties." Accordingly, the City's sole point of error is overruled, and the judgment of the district court is affirmed.
NOTES
[1] The commission does not challenge any other facets of the findings of facts and conclusions of law and the judgment. Accordingly, we limit our determination to the issue raised by the sole point of error. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534016/ | 991 S.W.2d 216 (1999)
Charles HIGGINS, Respondent,
v.
Melba L. OLSON, Appellant.
No. 73212.
Missouri Court of Appeals, Eastern District, Division Two.
May 18, 1999.
*217 William James O'Herin, Florissant, for appellant.
William W. Hollander, Clayton, for respondent.
LAWRENCE G. CRAHAN, Judge.
Melba L. Olson ("Melba")[1] appeals certain adverse aspects of the judgment in this action brought by Charles Higgins ("Charles") seeking damages for conversion of personal property, to quiet title to various parcels of real property and to partition property titled jointly. We affirm in part and reverse in part.
Charles and Melba met in 1991 and lived together without benefit of marriage from June, 1992, until December, 1995. At the time they met, Charles was separated from his wife and a dissolution proceeding was pending.
During their relationship, Charles and Melba jointly purchased two properties which were titled in Melba's name alone so that Charles' interest would not be disclosed or discovered in his pending dissolution proceeding. Another property, on Robert Street, was acquired and titled in joint names, although Melba paid the entire purchase price. When Charles' dissolution was concluded, he was awarded three rental properties which were separately titled in his name alone. Charles also acquired other houses during the relationship for which he paid all of the purchase money. These properties were also titled in Charles' name alone.
Charles and Melba's relationship ended when Melba obtained an adult abuse order in December, 1995. Although Charles had an extensive amount of personal property at the home he and Melba were sharing, much of it was never seen again.
Charles brought this action for conversion of his personal property, partition of jointly owned real property and to quiet title to the real estate held in his name alone. At trial, Melba claimed that she and Charles were engaged in a partnership to invest in real estate for profit and to sell certain Avon products she was accused of converting.
The trial court found that the parties had never entered into any written contract or partnership agreement with respect to any parcel of real estate. The court specifically found that a purported written agreement concerning a partnership in the Robert Street property had been fabricated by Melba. The court further found that there was no partnership agreement to sell Avon products.
The trial court found that Melba had converted Avon products owned by Charles valued at $18,715.40 and other personal property owned by Charles valued at $11,081.95. Judgment for such amounts was rendered in favor of Charles together with interest from December 1, 1995.
Charles was declared the sole owner of each of the parcels of real property titled in his name alone. Although the court found that Charles had contributed to the acquisition of the two properties titled in *218 Melba's name alone, Melba was declared the sole owner of those properties.
The jointly titled Robert Street property was awarded solely to Charles based on his contributions to the acquisition, maintenance and improvement of that property as well as the two other properties awarded to Melba. Charles was also awarded $5,000.00 in attorneys' fees.
The standard of review of this bench-tried case is set out in Murphy v. Carron, 536 S.W.2d 30 (Mo. banc 1976). The judgment will be affirmed unless there is no substantial evidence to support it, it is against the weight of the evidence, or it erroneously declares or applies the law. Id. at 32. We accept as true all evidence favorable to the prevailing party and all reasonable inferences drawn from it, disregarding all contrary evidence. State ex rel. Miller v. McLeod, 605 S.W.2d 160, 162 (Mo.App.1980).
In her first point, Melba claims the trial court erred in awarding Charles the entire interest in the property on Robert Street on the basis of his contributions to the two properties titled solely in Melba's name and awarded to Melba. Melba urges that this was a misapplication of the law because the judgment on its face indicates the court was impermissibly attempting to adjust equities beyond the scope of the common property being partitioned i.e. the property on Robert Street. Further, Melba urges, the trial court's finding that she had "failed to produce any competent evidence that she had made any substantial contribution to the acquisition, purchase and/or maintenance of [the Robert Street property]" is not supported by substantial evidence. We agree.
Charles testified that, although the Robert Street property was titled jointly, Melba furnished the entire $33,500 purchase price and he contributed nothing at the time of purchase. In Montgomery v. Roberts, 714 S.W.2d 234, 236 (Mo.App.1986) we held:
With a tenancy in common, if a deed "... does not specify the shares of each co-tenant, it will be presumed that they take equal undivided interests, but this presumption may be rebutted by proof, e.g., that the co-tenants contributed unequal amounts toward the purchase of the property and there is neither a family relationship among the co-tenants nor any evidence of donative intent on the part of those who contributed more than their pro rata amounts towards the purchase price." Roger Cunningham, William Stoebuck, Dale Whitman, The Law of Property, Section 52 (1984).
If one of two such co-tenants makes no contributions to the purchase price of the property, he is not entitled to any share. Id.
In this case, the stated basis for the trial court's award of the Robert Street property to Charles was in recognition of Charles' contribution to the acquisition, maintenance and improvement of the Robert Street property and the other two properties awarded to Melba. Melba does not dispute the evidence that Charles made substantial contributions to the acquisition, maintenance and improvement of the two properties she was awarded. However, Melba claims that the trial court cannot properly consider such contributions in partitioning the Robert Street property. We agree. The power of the court to adjust equities and conflicting claims on partition is subject to the limitation that the claims must relate to the common property. Grunden v. Nelson, 793 S.W.2d 569, 574 (Mo.App.1990), citing 68 C.J.S. Partition Sec. 135, p. 210 (1950). As the Missouri Supreme Court observed in Richardson v. Kuhlmyer, 250 S.W.2d 355, 360 (Mo.1952):
The circuit court may exercise a wide latitude in the adjustment of the equities among the parties to a partition suit.... The equities to be adjusted, however must of necessity be those which have arisen from or are in some way connected with the real estate to be partitioned; *219 they must be claims relating to the common property.
To the extent the trial court awarded the Robert Street property to Charles based on his contributions or improvements to other properties it misapplied the law.
As noted above, Charles made no contribution to the acquisition of the Robert Street property. Charles did offer evidence of approximately $3,450 in expenditures he made with respect to the Robert property. Melba claims that these expenditures were mere "upkeep" and not true improvements. From our examination of Charles' exhibit, it appears that Melba is at least partially correct in that Charles appears to have included ongoing expenses for utilities and even newspaper advertisements in his calculation which would not tend to enhance the value of the property. Other items apparently could be characterized as improvements but the record does not contain any testimony concerning the amount by which these modest expenditures enhanced the value of the Robert Street property.
On the other hand, the record also discloses a transaction for Charles' benefit which would substantially detract from the value of the Robert Street property. After the Robert Street property was acquired free of encumbrances, Charles, with Melba's consent, used the Robert Street property and another property owned by Charles as collateral for a $68,000 loan. Charles used the proceeds of this loan to pay an outstanding debt to his ex-wife and to purchase yet another property titled solely in Charles' name.
We need not decide whether a co-tenant who makes no contribution to the acquisition of the property may otherwise acquire a protected interest by making substantial improvements to the property. Under the somewhat unique circumstances presented in this case, we hold that the "improvements" claimed by Charles are insubstantial, particularly in light of the detriment imposed upon the property by the lien incurred solely for his benefit. Accordingly, in the interest of laying this litigation to rest and as permitted by Rule 84.14, we reverse that portion of the judgment awarding the Robert Street property to Charles and award the property at 1021 Robert Street to Melba Olson. We further order that Charles shall be required to hold Melba harmless for payment of the indebtedness secured by the lien.
In her fifth point, Melba urges the trial court erred in awarding attorneys' fees to Charles. Charles urges that the award of fees was predicated at least in part on the partition statute, Section 528.530 RSMo 1994. The only property which was the subject of a partition claim was the Robert Street property. In a partition action, the award of fees must be limited to fees incurred representing both parties. Buchanan v. Mitchell, 873 S.W.2d 945, 948 (Mo.App.1994). The attorney's initial duty is to prove his client's interest in the property. Id. Thereafter, the attorney is to render services for the benefit of both parties, with the result that the attorney is entitled to be compensated out of the common fund realized from the sale of the property. Id.[2]
Here, none of Charles' attorney's services inured to the benefit of both parties. The Robert Street property was neither partitioned nor sold, nor will it be in view of our disposition. Charles' attorney represented only Charles' interests in an adversary proceeding against Melba. He is not entitled to any fee pursuant to the partition statute.
Charles alternatively suggests that an attorneys' fee award was proper because the court was sitting as a court of equity. We disagree. Missouri follows the American Rule concerning the allowance *220 of attorneys' fees. Consolidated Public Water Supply Dist. No. C1 of Jefferson County v. Kreuter, 929 S.W.2d 314, 316 (Mo.App.1996). None of the circumstances which justify a departure from the American Rule are present in this case.
Pursuant to Rule 84.14, we reverse the award of attorneys' fees and amend the judgment to delete all references to attorneys' fees.
Melba's remaining points challenge the sufficiency of the evidence to support the trial court's finding that there was no partnership and its award of damages for conversion. We have reviewed the briefs of the parties and the record on appeal and find no error of law. Melba's remaining points are denied pursuant to Rule 84.16(b).
JAMES R. DOWD, P.J., RICHARD B. TEITELMAN, J., concur.
NOTES
[1] We will use the parties' first names for clarity. No disrespect is intended.
[2] These services typically include: preparing court orders; assisting in preparing notices advertising the sale; ensuring potential buyers for the sale; preparing deeds and documents after the sale; and disbursing the proceeds of the sale. Id. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534023/ | 424 A.2d 644 (1981)
Jacento ROSA and Maria F. Rosa
v.
John OLIVEIRA.
No. 76-323-A.
Supreme Court of Rhode Island.
January 15, 1981.
Gerard McG. DeCelles, Providence, for plaintiffs.
John Oliveira, pro se.
OPINION
PER CURIAM.
This case comes before us in a somewhat confusing posture. In 1973 a boundary dispute between these parties was heard by a justice of the Superior Court. Judgment was entered on January 21, 1974. Defendant Oliveira appealed from said judgment, and this court denied and dismissed the appeal in Rosa v. Oliveira, 115 R.I. 277, 342 A.2d 601 (1975). The case was remanded for further proceedings based solely upon the apparent failure to join Mrs. Oliveira as a party to the action. No issue was left open in respect to Mr. Oliveira.
Thereafter, following our disposition on appeal, Mr. Oliveira filed two motions directed to the trial justice asking that he "dismiss judgment" that had been previously rendered. The grounds for such motions are not entirely clear, but an examination of the first motion, together with the transcript of the hearing thereof, indicates that Mr. Oliveira made vague reference to misconduct *645 by plaintiffs and error by the trial justice. The first motion was denied June 8, 1976. The defendant appealed from the denial on June 17, 1976. A second motion was filed on June 25, 1976, also requesting that judgment be dismissed on the ground that Mrs. Oliveira was an indispensable party to the case. This claim may have been based upon a misunderstanding of our opinion in Rosa v. Oliveira, supra. In that case we suggested in a footnote that the record titleholder to the Oliveira property was Margaret Kilduff and that she had conveyed by unrecorded deed to Mr. and Mrs. Oliveira, but that Mrs. Oliveira had not been made a party to the action. We further suggested that this omission might be rectified on remand by use of Rule 21 of the Superior Court Rules of Civil Procedure. At no time was it claimed, nor did we suggest, that Mrs. Oliveira was an indispensable party to this action. The trial justice denied the second motion on July 9, 1976, and awarded attorney's fees in the amount of $150 to counsel for plaintiffs for defending both motions. From these orders defendant Oliveira has appealed.
Still later, on October 29, 1976, Mr. Oliveira filed a motion for a special order to give him access to the stenographer's tapes of the original trial proceedings which had taken place on various dates between October 17, 1973, and December 18, 1973. On November 24, 1976, the Presiding Justice of the Superior Court denied the request for review of such stenographic tapes on the ground that the asserted errors in the transcript were irrelevant. No appeal was taken from that decision.
However, a similar motion was made to this court on December 24, 1976, seeking review of the stenographic tapes. The motion was denied on April 14, 1977. On August 25, 1977, Mr. Oliveira commenced an action in the United States District Court seeking access to the same stenographic tapes. The complaint was dismissed in the United States District Court on April 17, 1979. Oliveira v. Rhode Island Supreme Court, C.A. 77-0527 (D.R.I. April 17, 1979), aff'd mem., 607 F.2d 993 (1st Cir.1979).
In light of the fact that this court determined the merits of defendant's appeal in 1975, Rosa v. Oliveira, supra, all actions taken by defendant since that time related to matters that were no longer open to consideration by the Superior Court. The trial justice had no power to vacate a judgment which had been affirmed by this court. His award of a modest counsel fee to the plaintiffs was certainly appropriate when Mr. Oliveira sought to vacate the identical judgment a second time.
The defendant has raised no matter before us on this second round of appeal which could not have been raised and adjudicated in our initial appellate review. All issues in respect to Mr. Oliveira arising out of this boundary dispute are res judicata. The doctrine of res judicata operates as a bar to relitigation of the same claim between the same parties not only in regard to issues that were specifically determined, but also in regard to all matters which might have been litigated in the earlier dispute. Molony & Rubien Const. Co. v. Segrella, 118 R.I. 340, 373 A.2d 816 (1977); Perez v. Pawtucket Redevelopment Agency, 111 R.I. 327, 302 A.2d 816 (1973). In short Mr. Oliveira presents to us on appeal no issues which were not precluded by the previous final judgment.
For the reasons stated, the defendant's appeals are denied and dismissed, the orders below are affirmed, and the papers in the case may be remitted to the Superior Court.
BEVILACQUA, C.J., did not participate. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534008/ | 47 Md. App. 526 (1981)
424 A.2d 784
ARTHUR W. MELESKI ET AL.
v.
PINERO INTERNATIONAL RESTAURANT, INC.
No. 137, September Term, 1980.
Court of Special Appeals of Maryland.
Decided January 20, 1981.
The cause was argued before MELVIN, WILNER and COUCH, JJ.
Jervis S. Finney, with whom were Ober, Grimes & Shriver on the brief, for appellant Chas. H. Steffey, Inc., Jerome F. Connell, Sr., with whom were Connell & Clinton on the brief, for appellants Arthur W. and Elizabeth J. Meleski. Michael Demyan on the brief for appellant John S. Collins.
*528 Martin J. Snider, with whom were Manis, Wilkinson & Snider, Chartered on the brief, for appellee.
MELVIN, J., delivered the opinion of the Court.
This case involves questions of partnership law, more particularly the liability of a partnership and its individual members to a non-partner for compensatory damages and punitive damages resulting from an alleged fraud practiced upon the non-partner by the partners in connection with a contract for the sale of a liquor license. To understand the precise issues presented it is necessary to set out in considerable detail the procedural history of the case below, tried before a jury in the Circuit Court for Anne Arundel County on special issues pursuant to Maryland Rule 560.
On June 21, 1974, a partnership known as Fort George Associates and Elizabeth J. Meleski, "parties of the first part, vendors," entered into a written "Agreement of Sale" with "International Restaurant, Incorporated, Maryland Corporation, second part, Vendee." The agreement contained the following recitals:
"Whereas the Vendors are the owners and possessors of a certain Class B liquor License issued by the Board of License Commission of Anne Arundel County for the premises known as 1630-32 Annapolis Road, unto Elizabeth J. Meleski trading as Butch's Beef and Beer, and
Whereas, the Vendee is the tenant of the adjacent property known as 1634 Annapolis Road, Odenton, Maryland and does intend to re-open the restaurant and tavern business on the said premises and
Whereas, the Vendees [sic] do desire to transfer their interest in the said Class B Liquor License and the said Vendees do desire to acquire and purchase the Vendors said interest, these premises are made."
The agreement then provided that the vendors "do hereby bargain and sell and transfer and assign all their right, title *529 and interest in and to the Class B Seven Day Liquor License owned by them unto the said Vendee at and for the purchase price of Twelve Thousand Five Hundred Dollars ($12,500)...." (Emphasis added). The purchase price was to be paid in monthly installments over a three year period and if the vendee failed to make any monthly payment within ten days of its due date "the whole balance" became "due and collectable at once." The agreement also provided that the vendors would "assist in any and whatever the Vendees in the matter of the transfer of the said License to them including whatever assistance it may render at the hearing before the Zoning Hearing Officer for Special Exception and before the Board of License Commissioners for the transfer of the said license." (Emphasis added).[1]
The agreement was signed on behalf of the partnership by one of the partners, John S. Collins. Collins was the managing partner and the attorney for the partnership. The agreement was also signed by Elizabeth Meleski individually, apparently in her capacity as the individual to whom a Class B liquor license had been issued in connection with the operation of the restaurant known as Butch's Beef and Beer. There was testimony, however, that the partnership, Fort George Associates, was "in fact" the owner of the liquor license. It seems that sometime in 1971 or 1972 Mrs. Meleski and her husband. Arthur Meleski, had bought into the partnership consisting of John S. Collins and Chas. H. Steffey, Inc. The partnership owned the property on which Mr. and Mrs. Meleski operated Butch's Beef and Beer restaurant, but at the time of the agreement, the restaurant had been closed since April 30, 1973, and, according to Mr. Meleski, the building was demolished two or three months after the restaurant was closed "due to the fact that we [the partnership] were going to build motels in the back." The motel was under construction in April 1974. Apparently, the *530 original building plans for the motel did not include a restaurant and there was testimony that the partnership considered it advantageous to have an operating restaurant with a liquor license next door as a convenience to the motel's guests.
The agreement was signed on behalf of the vendee, International Restaurant, Incorporated, by its president, Antonio Pinero. Mr. Pinero is a native of Cuba. He came to the United States in 1957 and became a U.S. Citizen in 1966. Prior to coming to Anne Arundel County he and his wife had operated, successively, small restaurants in Pennsylvania, Delaware and Washington, D.C. He said that in 1973 when "we lost our lease" to the premises where his Washington, D.C. restaurant was located, he and his wife sought another restaurant location. They were unsuccessful in their search until, in April 1974, they came to Anne Arundel County in answer to a newspaper advertisement that the English Company had a restaurant for rent. The restaurant was immediately adjacent to the property owned by the Fort George Associates partnership where Butch's Beef and Beer restaurant had been operated.
Before signing a lease with the English Company, Mr. Pinero, in early April, 1974, contacted Mr. Collins whose name had been mentioned to him as one who had a liquor license for sale. Collins told him of his (Collins') association with Fort George Associates and that the partnership had a license they would transfer to him. According to Pinero, after the $12,500 price was verbally agreed upon, he asked Collins why he couldn't "just get a new one" rather than pay $12,500 for the transfer. Pinero said Collins replied that there was a "moratorium" on the issuance of new licenses and that "you have to buy an existing license." Pinero testified that he regarded Collins as his lawyer in connection with all the "paperwork" necessary to the obtention of the transfer of the license, including the formation of International Restaurant Corporation to receive it, the preparation of the June 21, 1974 agreement of sale, and representation before the Anne Arundel County Zoning Hearing Officer and the County Liquor Board. He testified *531 that although he had owned a beer license in connection with his restaurant in Washington, D.C., he "didn't have any knowledge" of the liquor laws or "the different classes of licenses that existed in Anne Arundel County."
On September 7, 1977, the partnership (then consisting of Mr. and Mrs. Meleski and Chas. H. Steffey, Inc. Mr. Collins having retired as a partner in 1976 and Mrs. Meleski filed suit against International Restaurant Corporation.[2] The declaration alleged the existence of the June 21, 1974 written agreement of sale and that International had "wrongfully breached the contract by failing to pay" a balance claimed to be due on the purchase price of the liquor license they had sold to International. International had a perfect defense to this suit: the Class B liquor license that the plaintiffs purportedly owned and for which they sought payment from International did not exist on June 21, 1974. Although a valid Class B license had at one time been owned by the plaintiffs-vendors, it had been allowed to expire on April 30, 1974, after Butch's Beef and Beer restaurant had ceased to operate. Thus, when these admitted facts became known to the court, at a pre-trial hearing, International's motion for Summary Judgment was granted as to the plaintiffs' claim for payment.
In the meantime, International had filed in the proceedings a counterclaim against the original plaintiffs for fraud and deceit. It alleged that the counter defendants were partners in Fort George Associates and claimed a judgment against them "jointly and severally" for compensatory and punitive damages. International also filed in the proceeding what it called a "Third-Party Claim" against Mr. Collins seeking the same damages for the same fraud alleged in the counterclaim, i.e., that the partnership acting through one of the partners (Collins) falsely and fraudulently represented to International that the partnership owned a valid liquor *532 license "with the intent to deceive and defraud Third-Party Plaintiff to pay valuable consideration for a non-existent commodity." A separate count of the "Third-Party Claim" also sought damages against Mr. Collins for an alleged breach of duty owed to International as its attorney.
The case went to trial by jury on International's counterclaim and "Third-Party Claim" and the general issue pleas filed thereto. At the close of the evidence, various issues were submitted to the jury pursuant to Md. Rule 560 with instruction from the court. Based on the jury's answers to the issues submitted, the docket entries show that the following judgments were entered on October 2, 1979:
"Judgment Absolute extended for the Counter-Plaintiff, Pinero International Restaurant, Inc., against the Counter-Defendant, Arthur W. Meleski, in the amount of $4,068.00 compensatory damages and $11,250.00 punitive damages ($15,318.00); for the Counter-Plaintiff, Pinero International Restaurant, Inc., against the Counter-Defendant, Elizabeth J. Meleski in the amount of $4,068.00 compensatory damages and $11,250.00 punitive damages; in favor of Counter-Plaintiff, Pinero International Restaurant, Inc., against the Counter-Defendant, Charles H. Steffey, Inc., in the amount of $4,068.00 compensatory damages and $22,500.00 punitive damages, and in favor of the Third-Party Plaintiff, Pinero International Restaurant, Inc., against the Third-Party Defendant, John S. Collins, in the amount of $4,068.00 compensatory damages and $22,500.00 punitive damages, jointly and severally and as partners in Fort George Associates, Inc."
All of the partners (Mr. and Mrs. Meleski, Chas. H. Steffey, Inc. and John S. Collins) joined in filing a single notice of appeal. One brief was filed on behalf of all appellants.[3] We shall consider the questions presented in the *533 chronological order in which the alleged errors of the trial court occurred.
I
Appellants contend that the court erred in granting summary judgment to International on the partnership's original suit for breach of the June 21, 1974 agreement. Their argument here is that at the time the motion was granted there was evidence before the court from which it could be inferred that the original agreement had been changed by the parties and that International was indebted to them under the alleged new agreement or "novation." The difficulty with this argument is that the appellants elected to sue on the original written agreement, claiming that International owed them a balance on the purchase price of a liquor license that they allegedly owned and had sold to International for $12,500. There is no indication or contention that they ever sought to amend their declaration to allege any other agreement. Having conceded to the court in oral argument that at the time of the written agreement on which their suit was based they had no liquor license to sell, it is difficult to comprehend how they could expect to recover its "selling" price from International. The Summary Judgment was properly granted. Md. Rule 610.
II
During the course of appellant Collins' testimony at trial, the trial judge asked him a number of questions. `No objection was made to any of the questions as they were being asked by the judge, but shortly thereafter counsel for Chas. H. Steffey, Inc. asked the court to "tell the jury to disregard the questions and responses" on the grounds that the judge "clearly cross examined him [Collins]" and "inevitably influenced the jury and prejudiced the jury." Counsel for the Meleskis said that "the Court far exceeded its scope of examination ...", and counsel for Collins complained that "the way the questions were brought out, I think that the jury could have surmised that something important was being brought out that wasn't brought out before, *534 yet it was brought out in such a way that it was indication to them to the prejudice of the defense in this case that it it had more importance than it actually had." The record does not show that either of these counsel asked the court to take any action.
On appeal, appellants contend that "the court below erred in refusing to grant an immediate instruction to the jury, or a mistrial, upon its hypercritical interrogation of John S. Collins." They assert that the court's "questions were unsettling, belittling and overbearing" and that "the prejudicial impact was ... irreparable." We find no reversible error. First of all, none of the appellants asked for a mistrial. That issue is therefore not before us. Md. Rule 1085. Moreover, even though some of the court's questions may have elicited answers that were harmful to the appellants' case, we do not think that the questions were unwarranted under the circumstances. In any event, even if there had been error in any of the questions, the error was dispelled by the judge's instructions to the jury at the close of the case:
"You should not conclude from any conduct or words of mine that I favor one party or the other or believe or disbelieve the testimony of any witness. You and not I are the sole judges of the believability of the witnesses and the weight of the evidence. And you must not be influenced in any way by my conduct during the course of the trial. I sometimes ask questions during a trial because I'm not clear about a witness's testimony on certain points. You should not infer that this ... you should not infer that these matters are more important than others I did not ask questions about. I was merely seeking clarification. Even should you conclude that I may have come to certain conclusions of my own, you will not speculate as to what those conclusions are. I'm not a juror and I have no function in your deliberations in deciding the facts and applying the law. You are the ones who must decide the case."
*535 See State Roads Comm. v. Wyvill, 244 Md. 163, 170, 223 A.2d 146 (1965); Nicholson v. Blanchette, 239 Md. 168, 175, 210 A.2d 732 (1965).[4]
III
Appellants contend that "the court erred in refusing to direct verdicts for appellants on the issue of fraud, punitive damages, and the statute of limitations."
(a) Fraud
The appellants, citing Section 9-305 of the Corporations and Associations Article (Ann. Code of Md. 1975),[5] concede in their brief "that if fraud is established against one partner, the partnership (and thus all partners) are liable for that fraud...." With this correct concession, and in view of the absence of any real argument concerning the sufficiency of the evidence of fraud as to one of the partners (Collins), we find no merit to appellants' contention that a directed verdict should have been granted in favor of any of the appellants. The issue was clearly one for the jury to determine on the conflicting evidence and inferences therefrom.
(b) Punitive Damages
As we understand the appellants' argument here, it pertains only to the Meleskis and Chas. H. Steffey, Inc. It is argued that the jury should not have been permitted to consider punitive damages against the Meleskis and Chas. H. Steffey, Inc. because there is no evidence that they individually "authorized, participated in, or ratified the *536 malicious act." This argument is without merit for two reasons.
First, there is evidence in the case from which the jury could have found that the Meleskis and Chas. H. Steffey, Inc. did authorize, or at least ratify, the action of Collins in entering into the alleged fraudulent agreement of June 21, 1974 to "sell" the non-existent liquor license. By his own testimony, Mr. Meleski read the agreement before it was executed and authorized his wife to sign it. He also testified that Mr. John Steffey, chairman of the board of Chas. H. Steffey, Inc., was "aware" the agreement "was coming into existence." There was also evidence from which the jury could have found that after the execution of the agreement the partners accepted, indeed insisted upon, payments from the appellee with full knowledge that the liquor license they had "sold" him did not exist.
Secondly, it is uncontroverted that in executing the agreement on behalf of the partnership Collins was acting within the scope of the business of the partnership. His allegedly fraudulent conduct in inducing the appellee to enter the contract was, then, a partnership act, and if as a consequence he is liable for punitive damages, so too are the partnership and all other partners regardless of whether or not there is any affirmative proof that any of the other partners authorized, participated in or ratified his tortious conduct. Although we recognize there is authority to the contrary in other states,[6] we think the rule in Maryland is as we have stated it.
In Schloss v. Silverman, 172 Md. 632, 192 A. 343 (1937), the Court of Appeals stated the general rule of liability of a partnership and its several members for the torts of any of its members:
"The liability of one copartner for the tortious acts of another is analogous to the liability of a principal for the acts of his agent, since each *537 partner acts both as principal and as the agent of the other as to acts done within the apparent scope of the business and purpose of the partnership and for its benefit. 1 Rowley on Partnership, secs. 509, 485; 47 C.J. 884; 20 R.C.L., Partnership, secs. 94, 126. The test of the liability of the partnership and of the several members thereof for the torts of any one partner is whether the wrongful act was done within what may be reasonably found to be the scope of the business of the partnership and for its benefit (Ibid; Cooley on Torts, sec. 88), and the scope of the authority of a partner is determined by the same principles as those which measure the scope of an agent's authority." 172 Md. at 638.
The Court then went on to recognize that there is authority for the proposition that this general rule "is not applicable to the liability of one partner for the willful and malicious torts of another (Cooley on Torts, sec. 88), because such torts cannot be considered as within the usual scope of partnership business." Id. at 638. The opinion makes clear, however, that if a tort is "willful and malicious" [and therefore one for which punitive damages may be awarded] and is committed within the scope of the agency, the non-participating partners are equally liable.
"... But it is not altogether certain that the general rule is not applicable to such cases, because the conclusion that willful and malicious wrongs are not within the scope of an ordinary partnership may be a mere factual inference. The case of McIntyre v. Kavanaugh, 242 U.S. 138, 139, 37 S. Ct. 38, 39, 61 L. Ed. 205, cited as in apparent conflict with the rule that willful and malicious torts are not to be considered as within the usual scope of the business of an ordinary partnership, does not go as far as that. The court there was dealing with a case in which a partnership engaged in business as brokers wrongfully converted certain securities. Thereafter the firm and its members were adjudged *538 bankrupts. The depositor then sued one of the partners, who pleaded his discharge, personal ignorance of and nonparticipation in any tortious act. The Court there said: `That partners are individually responsible for torts by a firm when acting within the general scope of its business, whether they personally participate therein or not, we regard as entirely clear. ... If, under the circumstances here presented, the firm inflicted a willful and malicious injury to property, of course, plaintiff in error incurred liability for that character of wrong.' That case turned upon the fact that the tort was actually within the general scope of the partnership business, and is not inconsistent with the rule that a willful and malicious tort is not within the usual scope of an ordinary partnership. If the tortious act is a partnership act, it must also be severally the act of the partners; but if it is willful and malicious, and done by one of the partners without the knowledge or consent of the others, and not for the benefit or purposes of the partnership, it will not be considered as within the usual scope of an ordinary business partnership. In the case last cited the partnership received the securities, and the partnership appropriated them wrongfully to its use, sold them, deposited the proceeds to its credit, and used them as its funds. That those transactions were partnerships business was not a matter of inference, but was shown by direct and unequivocal proof. But whether regarded as an exception to the general rule, or as a mere application of it to appropriate facts, the weight of authority supports the view that, where one partner commits a willful and malicious tort not within the scope of the agency or the common business of the partnership, to which the other members have not consented, and which has not been ratified, they are not liable for harm thereby caused.... [Citations omitted]." (Emphasis supplied). Id. at 638, 639.
*539 In Schloss, the Court found no liability against a partnership and the non-participating partners for the tort (assault) of one partner, on the ground that the assault was not committed within the scope of partnership business. In the instant case, however, as we have already indicated, the conduct complained of as warranting punitive damages was uncontrovertedly within the scope of the agency or the common business of the partnership. Consequently, even if there had been no evidence that the Meleskis and Chas. H. Steffey, Inc. had authorized, participated in or ratified that conduct, they would be jointly and severally liable for any punitive damages awarded therefor.
The Maryland rule of derivative liability for punitive damages is well settled. In Safeway Stores, Inc. v. Barrack, 210 Md. 168, 122 A.2d 457 (1956), it was argued by the appellant corporation that it was not liable for punitive damages because it had not authorized, ratified or participated in the tortious acts of its agent and employee, one Smith. The Court said, at 210 Md. 176-177:
"The reasoning that would support an award of punitive damages against Smith would not necessarily apply to his employer. Some courts have held that a principal is not liable for punitive damages unless the principal authorizes, ratifies or participates in the act complained of. Lake Shore Ec. Railway Co. v. Prentice, 147 U.S. 101; Prosser, Torts (2d ed.), p. 21; Restatement, Torts, § 909. Cf. Wardman-Justice Motors v. Petrie, 39 F.2d 512 (D.C.), and Safeway Stores v. Gibson, 118 A.2d 386, 388 (Mun. C.A., D.C.), in which cases the courts found evidence of express authorization or ratification from the terms of employment and the retention of the agent after the incident was reported. But the Maryland cases take a less strict view. In Boyer & Co. v. Coxen, 92 Md. 366, 371, punitive damages were allowed against an employer in an assault case, where there was no evidence of authorization, participation or *540 ratification. There was, of course, evidence that the servant was acting in furtherance of the master's business, although his action in beating the plaintiff with a wrench was `wanton, high-handed and outrageous'. See also Dennis v. Baltimore Transit Co., 189 Md. 610, 616, and Balt. & Yorktown Turn. v. Boone, 45 Md. 344." (Emphasis added.)
In Boyer & Co. v. Coxen, 92 Md. 366, 367-369, 48 A. 161 (1901), the Court explained the reason for the Maryland Rule:
"Some courts of high authority have adopted the rule that a principal is only liable in punitive damages for the act of his agent when the former has either given express authority to the agent or subsequently ratified his act, or was guilty of some misconduct himself in connection with it. When it is remembered that such damages are allowed by way of punishment to the offender as a warning to others, the doctrine sanctioned by those Courts cannot be said to be wholly without foundation to base it upon, for it is at least unusual to punish one person for the act of another, unless the former did either authorize or ratify it or take some part himself in what is complained of. But there are a number of instances in which the principal may be even criminally liable for the acts of his agent, for some of which see 1 Ency. of Law (2 ed.), 1161, n. 2, and in this State we have not followed the doctrine held by the Courts above referred to in civil suits. Although the rule adopted here may in some cases result in hardship to the principal, yet, if carefully applied, there is less danger of injustice in enforcing it, in proper cases, than in denying it in all cases unless the principal has actually participated in the wrong done by his agent or servant or authorized or ratified it. Any liability of the master for a tort of his servant is dependent upon the fact that the *541 servant was acting at the time in the course of his master's service, and for his benefit, within the scope of his employment. The master selects him for that service and knows, or ought to know, what sort of a person he is investing with authority to act for him. The servant is acting for his master when the wrong is done it is in contemplation of law the act of the master. In a great many cases, a judgment against the servant would be of no value to the injured one and no punishment to the wrong-doer, as it could not be collected. Every character of business, of any considerable proportions, is for the most part conducted through agents and servants, and if the principal or master cannot be held responsible in punitive damages, it would in many, perhaps in most actions of torts, be equivalent to abolishing that character of damages, if he is to be relieved by reason of the fact that the act complained of was done by the servant, and not by him individually. This Court has therefore followed the rule that the master is not exempted from the liability for such damages merely because the act complained of was done by a servant, and not by the master himself, and in many cases exemplary damages have been allowed against the master for acts done by the servant, without express authority from the former or ratification by him having been shown.
In this case the jury was required to find that the agent, McKewen, was acting in the discharge of his duty for which he was employed, when he made the assault complained of, before it could render a verdict for the plaintiff, and, having so found, his principal was responsible in punitive damages, provided the facts were such as would have warranted that kind of damages, if the agent was being sued." (Emphasis in original).
We conclude from the cases cited (see also Carl M. Freeman Associates, Inc. v. Murray, 18 Md. App. 419, 306 *542 A.2d 548 (1973)), that since the relationship of co-partners, each to the other, is that of principal and agent, the principal of derivative liability that renders the partnership and each partner liable in compensatory damages for the acts of a partner done within the scope of the partnership business also renders them liable for punitive damages.
For the reasons stated, it was not error to submit the issue of punitive damages to the jury as to all partners in this case.
(c) Statute of Limitations
Appellants argue that the appellee's claim against them is barred by Md. Code Ann., Courts and Judicial Proceedings Article, § 5-101, which requires civil actions to be filed within three years from the date they accrue.
Three of the appellants, the two Meleskis and Chas. H. Steffey, Inc., did not file timely pleas of limitations to the counterclaim filed against them by the appellee. See Maryland Rule 342 c 2 (requiring limitations as a matter of defense to be "specially pleaded in actions ex delicto") and Rule 342 d 2 (requiring that a plea of limitations be filed within fifteen days of service of the counterclaim). The untimeliness of the plea as to them was raised by the appellee in its response to their pre-trial motion for summary judgment on limitations grounds. The court correctly ruled that the defense was not available to them. Foos v. Steinberg, 247 Md. 35, 230 A.2d 79 (1967).
It appears that the other appellant, Collins, also failed to file his plea of limitations within the time required by the Rules.[7] In his case, however, the appellee has raised no issue of its untimeliness either in the proceedings below or in this appeal. The untimeliness of the plea has therefore been waived and is not before us as an issue in the case. Md. Rule 1085.[8] The issue that is before us is whether, without regard *543 to the untimeliness of the plea, the "Third-Party Claim" against Collins is barred by limitations as a matter of law or whether the trial judge was correct in submitting the issue to the jury.
Md. Code Ann., Courts and Judicial Proceedings Article, § 5-101, requires civil actions to be filed within three years from the date they accrue. In this case the action for fraud and deceit was filed on January 6, 1978. Ordinarily, a claim accrues when the wrong is committed, not when it is discovered. Watson v. Dorsey, 265 Md. 509, 290 A.2d 530 (1972). The appellee does not argue here that the fraud and deceit alleged by it occurred within three years prior to the filing of suit; rather that the beginning date for limitations was postponed until the fraud was discovered by Pinero in October, 1977 and that since the action was filed within three years of that time, the suit is not barred by limitations.
Md. Code Ann., Courts and Judicial Proceedings Article, § 5-203, provides:
"If a party is kept in ignorance of a cause of action by the fraud of an adverse party, the cause of action shall be deemed to accrue at the time when the party discovered, or by the exercise of ordinary diligence should have discovered the fraud."
In view of the conflicting evidence and inferences therefrom concerning what the appellee knew and when he knew it, we cannot say, under all the circumstances, that the trial judge erred in not ruling as a matter of law that the action against Collins was barred by limitations. See Herring v. Offutt, 266 Md. 593, 599, 295 A.2d 876 (1972), where the Court of Appeals said:
"Whether a plaintiff's failure to discover his cause of action was due to his lack of diligence, or *544 to defendant's concealment of his wrong, is ordinarily a question for the trier of fact. [Citations omitted]."
IV
Finally, appellants contend that the trial judge erred in his instructions concerning punitive damages. We find no reversible error except in one important respect.
The jury was told, in effect, that where one partner "acting in the ordinary course of the business of the partnership" wrongfully acts or fails to act and thereby causes loss or injury to a non-partner, the other partners are liable for that loss or injury as well as for any punitive damages incurred "to the same extent as the partner sole acting or omitting to act." (Emphasis added). This was consistent with the principle of derivative liability for punitive damages already discussed in this opinion. It is also consistent with the Maryland Uniform Partnership Act, Title 9 of Md. Ann. Code (1975), Corporations and Associations Article, § 9-305 and § 9-307.[9] We find no reversible error in that instruction. Later in his instructions, however, the judge instructed the jury as follows:
"If you find that punitive damage should be awarded, then you will consider a separate award as to each defendant as set out in issue number 10." (Emphasis added).
*545 Issue No. 10 and the jury's answer thereto was as follows:[10]
"10. If your answer to #9 is `yes,' what punitive damages do you find as to:
Arthur Meleski $11,250.00
Elizabeth Meleski $11,250.00
Charles H. Steffey, Inc. $22,500.00
If you answered #1 `no,'
John S. Collins $22,500.00"
Oddly enough both sides made timely objections to the form of issue No. 10. Though counsel for appellee now defends the instruction, he objected to it below:
"With reference to number 10 specifying the punitive damages can be found by the jury as to *546 each individual or against each individual defendant, I'd respectfully indicate that, at least as the state of the law at this time, it is a joint and several obligation as I read the law and that the apportionment, although maybe more reasonable and ultimately required by the courts or the legislature, it is not the state of the law at this time and that the jury should probably have considered a joint and several verdict."
Counsel for Chas. H. Steffey, Inc., speaking for all appellants at the time, said:
".... [A]s did Mr. Snider [counsel for appellee], I also object to question ten. It seems to me first, that Your Honor states in the instruction that each partner is liable for the punitive damages as to one. And now in effect in the issues, Your Honor is inviting the jury to find in effect punitive damages as to all. Second, this suffers from the same objection which I've made to Your Honor several times and stated earlier in this presentation, and that is that it permits the jury to assess liability for punitive damages against partner `as', not liability against partner `b' and then proceed to assess no punitive damages against partner `a', but then go ahead and impose punitive damages upon partner `b', when they found that partner `b' in and of partner `b' himself or herself was not liable for punitive damages. Finally, with respect to number ten, my third point is, Your Honor, that once Your Honor has decided, as Your Honor did, to impute or impose punitive damages upon all when the jury found upon one, it seems to me it is inconsistent and unfair and inflationary to the find of punitive damages to then double back and suggest to the jury in the last analysis that they find individual awards of punitive damages against the individual defendants. Thank you, Your Honor."
We think it was error to allow the jury to "consider a *547 separate award [of punitive damages] as to each defendant" in this case. It is true that the purpose of punitive damages is not so much to compensate the plaintiff but is, "over and above full compensation, to punish the wrongdoer, to teach him not to repeat his wrongful conduct and to deter others from engaging in the same conduct." Wedeman v. City Chevrolet Co., 278 Md. 524, 531, 366 A.2d 7 (1976). Considering that purpose, there is considerable logic to support the individualization of punitive damage awards in cases where multiple defendants are all liable for one sum in compensatory damages but there are shown different degrees of complicity among the individual defendants in the wrongdoing giving rise to punitive damages. As we said in Cheek v. J.B.G. Properties, Inc., 28 Md. App. 29, 43-44, 344 A.2d 180 (1975):
"Those jurisdictions favoring apportionment seem to rely on the reasonable view that a jury should be permitted to vary the damages depending upon the degree of culpability since punitive or exemplary damages are not compensation for injury; instead, they are private fines levied by civil juries to punish reprehensible conduct and to deter its future occurrence. Cf., Gertz v. Welch, supra, 418 U.S. at 350, 41 L.Ed.2d at 811."
In Cheek we reversed judgments entered against a corporate defendant and its employee for allegedly slanderous remarks made by the employee about the plaintiffs. The judgments included awards for punitive damages which the jury "apportioned" between the two defendants. More precisely, the jury made separate awards of punitive damages against each defendant.[11] The judgments were reversed and a new trial ordered on grounds *548 not related to the "apportionment" issue. We, nevertheless, by way of strong dicta, if not by way of a holding, concluded "that Maryland should be in the majority of states permitting apportionment of punitive damages." Id. at 45 (emphasis added). In espousing this dicta for guidance of the trial judge to whom Cheek was remanded, we were influenced by the logic of allowing apportionment of punitive damages and the inequity inherent in a rule to the contrary. To fully accomplish their purpose, punitive damages must be imposed individually based upon the individual's culpability and financial means. Moreover, the introduction of evidence of financial worth of the defendants is bound to produce unfairness if the awards are not individualized.[12]See Washington Gas Light Co. v. Lansden, 172 U.S. 534; Nance v. Gall, 187 Md. 656, 50 A.2d 120 (1947); Schloss v. Silverman, 172 Md. 632, 192 A. 343 (1937).
Nevertheless, we are now squarely faced with the issue of, not whether Maryland should permit "apportionment" of punitive damages, but whether it does permit it. We conclude that it does not at least where, as in this case, the defendants are in a principal-agent relationship. The reason for our conclusion is the Maryland rule heretofore discussed that liability for punitive damages, where there are multiple defendants who are in a principal-agent relationship, is joint and several without regard to their relative culpability. As this rule presently stands it does not permit the application of and cannot co-exist with a so-called "apportionment" rule that allows a separate award against each of several defendants measured by each defendant's individual culpability.
In Nance v. Gall, 187 Md. 656, 50 A.2d 120 (1947), the plaintiff, Gall, brought suit for malicious prosecution against a railroad superintendent, Nance, and the railroad company for allegedly wrongful conduct of the *549 superintendent in instituting criminal charges against him. A verdict in one sum for punitive damages was rendered against Nance and the railroad company. On appeal, the Court held that Nance acted beyond the scope of his authority and therefore reversed the judgment against the railroad company without a new trial. By its first opinion, the Court let stand the judgment against Nance, but later modified the opinion to reverse the judgment against Nance as well and awarded him a new trial. The Court felt that "the jury intended, by its verdict, to inflict punishment on both the corporate and individual defendants, and would not have rendered the verdict it did if the action had been instituted solely against Nance." Id. at 677. In the course of its modified opinion the Court said:
"The verdict which the jury rendered was a joint verdict and it could not have been apportioned as to the two defendants." Id. 675.
* * *
"Appellee argues that Nance knew that punitive damages might be assessed against him as the case below was tried on that theory, and that the record is devoid of any suggestion that Nance was entitled to or sought separate consideration in the matter of damages. But the jury could not apportion its judgment so as to make a part of it applicable to Nance and a part applicable to the railroad company. It could only render a joint judgment, and each would be responsible for the entire judgment." Id. 676. (Emphasis added).
In Cheek v. J.B.G. Properties, Inc., supra, we discerned from Nance and the cases there cited, acceptance of the principles for a punitive damage apportionment rule and apparently concluded that by the above-quoted language the Court was making an observation upon the dilemma of the jury in that case, rather than espousing binding legal concepts. However, in light of the clearly established Maryland rule of derivative liability for punitive damages, we have rethought *550 our former position. We do not now believe that Nance can be read so broadly as to allow us to effect a change in that rule so as to permit individualized awards of punitive damages in cases where, as here, the defendants are in a principal-agent relationship. Only the Court of Appeals or the Legislature is free to change this long standing Maryland rule that in our opinion prevents such awards.
Aside from what we have already said, in view of the inconsistent instructions on punitive damages (on one hand that all partners are liable for punitive damages to "the same extent" as any one partner, and, on the other hand, that separate amounts may be awarded against each of the partners), we think it is by no means clear that the jury intended a total punitive damage award of $67,500 rather than a total of $22,500 for which each partner[13] would be jointly and severally liable "to the same extent" as every other partner. The judgments actually entered, with respect to punitive damages, were separate judgments in favor of the appellee (counterclaim plaintiff and Third-Party Plaintiff below) against each of the partners of $22,500.00 for which each of them would be liable "jointly and severally and as partners." Obviously, a joint and several judgment for which each partner is individually liable is not consistent with the notion that each partner be liable for only his own individual culpability. This uncertainty as to the jury's intention would alone require a new trial on the issue of punitive damages.
With respect to compensatory damages, it is obvious that the jury intended a total award of $4,068.00 against all partners not $4,068.00 separately against each partner. Yet, separate judgments, totalling $16,272 were entered for which the partners were, again, to be "jointly and severally liable and as partners." Clearly, as to compensatory damages, there should have been one joint judgment for $4,068.00 against all partners. This can be easily corrected upon remand.
*551 For the reasons stated, we shall vacate the judgments entered and remand the case with direction to the trial court to enter one judgment for $4,068.00 in compensatory damages against all appellants. With respect to punitive damages, a new trial on that issue is awarded. For the guidance of the trial court, we point out that, in view of the issues already properly determined by the jury, the sole issue to be determined on remand is the amount of punitive damages that in the discretion of the trier of fact should be assessed jointly against the appellants as a result of their liability, already determined, for having committed fraud in the inducement of the June 21, 1974 contract.
Judgments vacated; case remanded for further proceedings not inconsistent with this opinion; costs to be paid one-half by appellants and one-half by appellee.
NOTES
[1] As a condition precedent to the regular use of any premises for the sale of alcoholic beverages, the Anne Arundel County Zoning Regulations in effect at the time required that a Special Exception therefor be granted. The issuance or transfer of a liquor license was also subject to the approval of the County Liquor Board.
[2] The named defendant was actually "Pinero International Restaurant, Inc." but the pleadings were amended by interlineation on October 3, 1978, to reflect "International Restaurant Corporation" as the apparently correct name of Mr. Pinero's corporation. We hereafter refer to the Corporation as "International."
[3] At the trial below, the Meleskis, Chas. H. Steffey, Inc. and Collins were represented by separate counsel.
[4] We do not intimate that in all circumstances a trial judge's prejudicial conduct can be cured by instructions at the end of the case. Depending on the circumstances, there may be cases where a judge's conduct is so prejudicial as to be irreparable. The instant case is not one of those cases.
[5] "§ 9-305. Partnership bound by partner's wrongful act.
Where, by any wrongful act or omission of any partner acting in the ordinary course of the business of the partnership, or with the authority of his copartners, loss or injury is caused to any person, not being a partner in the partnership, or any penalty is incurred, the partnership is liable therefor to the same extent as the partner so acting or omitting to act. (An. Code 1957, art. 73A, § 13; 1975, ch. 311, § 2.)"
[6] See e.g. Broudy-Kantor Co. v. Levin, 135 Va. 283, 116 S.E. 677, 32 A.L.R. 249 (1923); Wright v. E.Z. Finance Co., 267 S.W.2d 602 (Tex. Civ. App. 1954).
[7] Appellee's "Third-Party Claim" against Collins was filed January 6, 1978 and served upon Collins on January 16, 1978. His pleas thereto, including the plea of limitations, were not filed until March 16, 1978.
[8] See also Poe's Pleading and Practice, Vol. 2 (Sixth Ed.), § 618:
"... [T]he failure of the defendant to file the plea within the time prescribed by the rule of court will be waived if the plaintiff reply and issue be joined. To avoid this result, the proper course for the plaintiff to pursue when the plea of limitations is filed too late is to move that it be not received which motion will be granted almost as of course; the plea, if already filed by the clerk, will be stricken from the record."
[9] "§ 9-305. Partnership bound by partner's wrongful act.
Where, by any wrongful act or omission of any partner acting in the ordinary course of the business of the partnership, or with the authority of his copartners, loss or injury is caused to any person, not being a partner in the partnership, or any penalty is incurred, the partnership is liable therefor to the same extent as the partner so acting or omitting to act. (An. Code. 1957, art. 73A, § 13; 1975, ch. 311, § 2.)"
"§ 9-307. Nature of partner's liability.
All partners are liable:
(1) Jointly and severally for everything chargeable to the partnership under §§ 9-305 and 9-306; and
(2) Jointly for all other debts and obligations of the partnership; but any partner may enter into a separate obligation to perform a partnership contract. (An. Code 1957, art. 73A, § 15; 1975, ch. 311, § 2.)"
[10] The other pertinent issues submitted and the jury's answers were:
"1. Does the statute of limitations bar any claims against Mr. Collins?
Yes ____ No x
2. Was there a mutual mistake as to the subject matter of the contract?
Yes ____ No x
4. If your answer to #2 is `no,' did the parties come to a new agreement a new contract after June 21, 1974?
Yes ____ No x
5. If your answers to #2 and #4 are `no,' did the partners commit fraud in the inducement of the contract of June 21, 1974?
Yes x No ____
6. If your answer to #5 is `yes,' what compensatory damages do you find?
$4,068.00
9. If your answer to either #5 or #7 is `yes,' and if you have awarded compensatory damages in either #6 or #8, do you find that punitive damages should be awarded against the partners?
Yes x No ____"
[11] We use the word "apportionment" only for convenience and because other cases have employed it. In fact, this term is inaccurate as applied to punitive damages, in that it assumes the existence of a single sum that can then be divided. When a jury is allowed to "apportion" punitive damages, it does not first ascertain some abstract total award and then equitably apportion that among the multiple defendants; rather, the jury begins and ends by imposing a separate amount against each defendant determined by that defendant's individual culpability and estimated ability to pay.
[12] In the present case, as in Nance v. Gall, supra, no evidence was introduced of the financial means of any of the defendants. Such evidence is not a prerequisite to awarding punitive damages. Fletcher v. Western National Life Insurance Co., 10 Cal. App. 3d 376, 404, 89 Cal. Rptr. 78 (1970).
[13] The jury considered Mr. and Mrs. Meleski, who between them held a one-third interest in the partnership, as one unit. The other two partners each held a one-third interest. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534046/ | 991 S.W.2d 330 (1999)
CITY OF HOUSTON, Texas, Appellant,
v.
James E. TIPPY and Texas Workforce Commission, Appellees.
No. 01-97-01429-CV.
Court of Appeals of Texas, Houston (1st Dist.).
April 1, 1999.
Rehearing Overruled May 14, 1999.
*331 Marcus Dobbs, Houston, for appellant.
Anthony Aterno, Austin, W. Stacey Mooring, Houston, for appellee.
Panel consists of Chief Justice SCHNEIDER and Justices O'CONNOR and TAFT.
OPINION
O'CONNOR, J.
The City of Houston, the appellant, appeals from the award of unemployment benefits by the Texas Workforce Commission *332 (TWC),[1] the appellee, to James E. Tippy, also an appellee. We reverse and render judgment for the City.
A. Factual Background
Tippy was a police officer for the Houston Police Department (HPD). As a police officer, he was responsible for knowing the laws, rules, and regulations governing police officers, including those in the rules manual of the HPD, and the City of Houston Civil Service Commission's Rules Governing Members of the Fire and Police Departments. Tippy was responsible for following these regulations and the general orders of his department.
Tippy began working for the HPD in 1983. In May 1994, the HPD internal affairs division began an investigation of Tippy's former partner. During the investigation, the HPD reviewed transcripts of the mobile digital terminal (MDT) transmissions sent between Tippy and his former partner. The MDT is the computer terminal used in the City's police cars. The transcripts revealed conversations between Tippy and his former partner in which Tippy referred to a superior officer as a "guinea wop" (an ethnic slur against Italians), he referred to his superiors as a "bunch of zips," and he complained of a directive issued by "my stupid lieutenant."
The investigation of Tippy's former partner led to a review of Tippy's MDT transmissions over the entire month of March 1994. The review of Tippy's on-duty activities during that month revealed numerous violations of department policy, including habitual negligence in the performance of his duties and disrespect for his supervisors and fellow officers.
The internal affairs division sent Tippy a letter informing him of seventeen allegations against him.[2] Tippy was ordered to respond to the allegations, which he did. In September 1994, Tippy was fired by the chief of police. The police chief indicated by letter that he fired Tippy because of the allegations against him and because of his past record with the HPD.
B. Procedural Background
Tippy filed a claim for and was awarded unemployment benefits by the TWC.[3] The *333 City appealed that decision, claiming Tippy was discharged for misconduct and, therefore, disqualified from receiving unemployment benefits.[4] A hearing was conducted before the Appeals Tribunal of the TWC. The hearing officer affirmed the award of unemployment benefits.
Of the 17 allegations of misconduct against Tippy, the hearing officer concluded only two were proven by the City Tippy's use of an ethnic slur and a failure to adhere to police duty because he spent an excessive amount of time on the MDT for personal conversations.[5] The hearing officer concluded the evidence did not support a finding of misconduct to disqualify Tippy from receiving unemployment benefits under Section 207.044 of the Labor Code.
The City appealed the decision of the Appeals Tribunal to the Commission.[6] The Commission affirmed in a 1-1 decision. The City appealed the TWC decision by filing suit in district court. Tippy and the TWC filed a motion for summary judgment, and the City filed a cross-motion for summary judgment. The trial court granted Tippy and the TWC's motion, and denied the City's. The City appeals the trial court's judgment.
The City presents two issues on appeal. First, the City argues there was not substantial evidence to support the TWC's decision. Second, the City asks this Court to decide whether the hearing officer followed the correct standard in determining whether Tippy should have been disqualified from receiving unemployment benefits.
C. Analysis
1. Trial court's standard of review
The trial court reviews a TWC decision de novo to determine whether there is substantial evidence to support the TWC's decision. Mercer v. Ross, 701 S.W.2d 830, 831 (Tex.1986); Morgan, 877 S.W.2d at 13. The trial court may hear any evidence in existence at the time of the hearing before the Appeals Tribunal regardless of whether it was introduced at the hearing. See Firemen's and Policemen's Civil Serv. Comm'n v. Brinkmeyer, 662 S.W.2d 953, 956 (Tex.1984); G.E. American Communication v. Galveston Cent. Appraisal Dist., 979 S.W.2d 761, 764 (Tex.App.Houston [14th Dist.] 1998, no pet.). The determination of whether the TWC's decision was supported by substantial evidence is a question of law. Arrellano v. Texas Employment Comm'n, 810 S.W.2d 767, 770 (Tex.App.San Antonio 1991, writ denied).
The TWC's ruling carries a presumption of validity, and the party seeking to set it aside has the burden to show it was not supported by substantial evidence. *334 Mercer, 701 S.W.2d at 831; Morgan, 877 S.W.2d at 13. The trial court may not set aside a TWC decision merely because it would reach a different conclusion. Mercer, 701 S.W.2d at 831; Morgan, 877 S.W.2d at 13-14. It may do so only if it finds the TWC's decision was made without regard to the law or the facts, and, therefore, was unreasonable, arbitrary, or capricious. Mercer, 701 S.W.2d at 831; Morgan, 877 S.W.2d at 13-14.
2. Summary judgment standard of review
The summary judgment rule provides a method of summarily ending a case that involves only a question of law and no fact issues. Tex.R.Civ.P. 166a(c); Nixon v. Mr. Property Management Co., 690 S.W.2d 546, 548 (Tex.1985); Cigna Ins. Co. v. Rubalcada, 960 S.W.2d 408, 411 (Tex. App.Houston [1st Dist.] 1998, no pet.). When, as here, both sides move for summary judgment and the trial court grants one motion and denies the other, we review the summary judgment evidence presented by both sides and determine all questions presented. See Commissioner's Ct. of Titus Cty. v. Agan, 940 S.W.2d 77, 81 (Tex.1997); Rubalcada, 960 S.W.2d at 411-12. We render such judgment as the trial court should have rendered. Agan, 940 S.W.2d at 81; Rubalcada, 960 S.W.2d at 411-12.
Tippy and the TWC's motion for summary judgment asserted there was substantial evidence to support the decision to grant Tippy unemployment benefits. The City's cross-motion claimed it was entitled to judgment as a matter of law because the hearing officer applied the wrong standard in determining whether there was misconduct. Specifically, the City argued there was not substantial evidence to support the hearing officer's decision because, even though he also found Tippy committed two of the allegations against him, the hearing officer concluded Tippy was not discharged for misconduct.
By granting summary judgment to Tippy and the TWC, the trial court held there was substantial evidence to support the TWC's decision. We must determine whether Tippy and the TWC established there was substantial evidence to support the TWC's decision. We must look at the evidence presented to the trial court, and not the agency record by itself. Nuernberg v. Texas Employment Comm'n, 858 S.W.2d 364, 365 (Tex.1993); Morgan, 877 S.W.2d at 13. The record of the TWC's proceeding, which was admitted as summary judgment evidence without objection, was part of the evidence considered by the trial court.
3. Substantial evidence
When the trial court examines whether there is substantial evidence to support an agency's decision, it determines whether reasonable minds could have reached the same conclusion the TWC reached. See Dotson v. Texas State Bd. of Med. Exam'r, 612 S.W.2d 921, 922 (Tex. 1981); Sanchez v. Huntsville I.S.D., 844 S.W.2d 286, 290 (Tex.App.Houston [1st Dist.] 1992, no pet.). Substantial evidence is more than a mere scintilla, but less than a preponderance of the evidence; therefore, the evidence may preponderate against the TWC's decision but still amount to substantial evidence. See Texas Health Facilities Comm'n v. Charter Medical-Dallas, Inc., 665 S.W.2d 446, 452 (Tex.1984); Sanchez, 844 S.W.2d at 290.
4. Tippy and the TWC did not prove there was substantial evidence as a matter of law
The following summary judgment evidence was presented to the trial court: a letter sent to Tippy from his sergeant detailing the allegations against Tippy, Tippy's letter responding to the allegations, the police chief's letter of indefinite suspension, the tapes and a full transcript of the hearing before the Appeals *335 Tribunal, Tippy's affidavit, and the Appeals Tribunal's findings.[7]
Tippy offered plausible explanations for most of the allegations against him, except the allegations regarding his personal messages over the MDT. Tippy sent unauthorized, personal messages over the MDT that included racial slurs (referring to a superior officer as a "guinea wop") and criticism of his supervisors (referring to his superiors as a "bunch of zips," and complaining of a directive issued by "my stupid lieutenant"). Tippy responded that his use of "guinea wop" was just a manner of referring to supervisors in general, and was not meant as an ethnic slur for either the sergeant or lieutenant for whom he worked, although they were Italian. Tippy believed the other comments he made did not constitute violations of the rules regarding respect for fellow employees, criticism of the department, or the use of racial slurs. Tippy also said he followed all lawful orders.
Tippy's explanation for using racial slurs, and his criticism of his superiors and the department, is not plausible considering he had a history of problems with an Italian sergeant and an Italian lieutenant. Tippy and the TWC attempt to distinguish between a racial and an ethnic slur, claiming that Tippy's statements were ethnic slurs, and, therefore, did not violate the rule. This argument is without merit. The HPD Rules Manual states, "No officer shall engage in any form of speech likely to be construed as a racial or religious slur or joke, whether in the presence of citizens or of other officers." Tippy's attempt to categorize "guinea wop" as an ethnic slur, as opposed to a racial slur, does not eliminate the fact that it is a phrase "likely to be construed" as a racial slur.
After reviewing the evidence before the trial court, we find that the hearing officer's decision was arbitrary and capricious because the hearing officer disregarded the law defining misconduct and the evidence of the HPD's rules. See Mercer, 701 S.W.2d at 831; see also Morgan, 877 S.W.2d at 13-14. Therefore, we conclude that the trial court erred by concluding there was substantial evidence to support the TWC's decision. See Dotson, 612 S.W.2d at 922; Sanchez, 844 S.W.2d at 290.
The hearing officer, and the trial court, ignored the evidence of the HPD rules and regulations.[8] The City and HPD had specific *336 rules against the use of racial slurs, against misuse of the MDT system,[9] and against devoting on-duty time to any activity that is not directly related to the officer's police duties.[10]
The hearing officer also ignored the Labor Code's definition of misconduct: mismanagement of a position of employment by action or inaction, neglect that jeopardizes the life or property of another, intentional wrongdoing or malfeasance, intentional violation of a law, or violation of a policy or rule adopted to ensure the orderly work and the safety of employees. Tex.Lab.Code § 201.012(a) (emphasis added); see also Morgan, 877 S.W.2d at 14. The statute limits misconduct to the violation of a rule or policy "adopted to ensure the orderly work and the safety of employees." The rules against the use of racial slurs, against misuse of the MDT system, and against devoting on-duty time to any activity unrelated to police duty must fall within this category.
We recognize not every violation of an employer's personnel policy will trigger the denial of unemployment benefits. Collingsworth Gen. Hosp. v. Hunnicutt, 988 S.W.2d 706, 708 (Tex., 1998).[11] However, we must focus on the adverse impact of an employee's misconduct on an employer, and the purpose of the Unemployment Compensation Act. Id. at 709. The intent and purpose of the Unemployment Compensation Act is to provide compensation for workers who are unemployed through no fault of their own. Id. It is implausible to argue, as Tippy and the TWC do, that Tippy was not at fault.
We sustain the appellant's issue one.
We reverse the trial court's judgment and render judgment for the City.
NOTES
[1] This case was originally styled as The City of Houston, Texas v. James E. Tippy and Texas Employment Commission. However, effective September 1, 1995, after the suit was filed, the Texas Employment Commission was renamed the Texas Workforce Commission. See Act of May 26, 1995, 74th Leg., R.S., ch. 655, § 11.75, 1995 Tex.Gen.Laws 3543, 3621-22. In this opinion, we refer to the TWC.
[2] In addition to Tippy's use of racial slurs and misuse of the MDT system, the other allegations, and Tippy's response to them, can be summarized as follows:
(1) Tippy did not sign on for duty within 20 minutes after the start of his shift on several occasions. Tippy said this was accepted practice because officers did not sign on until they were available to be dispatched for calls. He said there were a number of circumstances that would preclude him or any other officer from signing on within 20 minutes, such as a roll-call that ran late, returning telephone calls, picking up subpoenas, or waiting on the availability of a car because none was permanently assigned to him.
(2) Tippy spent an excessive amount of time on several calls (the City gave specific dates and times). Tippy said the time he spent on these calls was within the average time spent according to the department's compiled statistics. He said there were circumstances to justify the time spent; therefore, he did not spend an excessive amount of time on any of the calls.
(3) Tippy did not notify the dispatcher of a change in his location on at least three occasions. Tippy said he was never told he had to notify the dispatcher of a change in his location while out on a call, and he was always available by hand-held radio, car radio, MDT, or telephone.
(4) Tippy ate lunch outside his assigned area. Tippy said he had permission to do so from his sergeant.
[3] The statutory procedure for filing unemployment claims is as follows: An unemployed individual files a claim with the TWC. Tex.Lab.Code § 208.001(a). The TWC notifies the individual's previous employer of the claim. Tex.Lab.Code § 208.002(a). The employer must notify the TWC of any facts that may adversely affect the individual's claim. Tex.Lab.Code § 208.004(a). The TWC then makes an initial determination of whether the individual's claim for unemployment is valid. Tex.Lab.Code § 208.021.
A dissatisfied claimant or employer may appeal the TWC's initial determination to the Appeals Tribunal. Tex.Lab.Code § 212.101(a). The Appeals Tribunal consists of a salaried examiner (also called a hearing officer). Tex.Lab.Code § 212.101(b). Either the claimant or the employer may appeal the Appeals Tribunal's decision to the Commission. Tex.Lab.Code § 212.151. The Commission refers to the three gubernatorial appointees to the TWC. Tex.Lab.Code § 301.002.
[4] An individual is entitled to unemployment benefits unless the individual was discharged for misconduct connected with his last work. Tex.Lab.Code § 207.044; see also Texas Employment Comm'n v. Morgan, 877 S.W.2d 11, 14 (Tex.App.Houston [1st Dist.] 1994, no writ).
[5] In reaching this conclusion, the hearing officer said,
[W]hile the claimant [Tippy] may have been a marginal police officer, the only allegations supported unquestionably by the evidence are his use of an ethnic slur and a failure to adhere to police duty by spending excessive time on the MDT on personal conversations.
[6] The Commission refers to the three gubernatorial appointees to the TWC. Tex.Lab.Code § 301.002.
[7] The City argues for the first time in its reply brief that the trial court should not have considered the written conclusions of the hearing officer because the conclusions were not evidence in existence at the time of the hearing. Specifically it attacks the hearing officer's opinion regarding Tippy's suspension. We agree that the trial court should not have considered this evidence because it was not in existence at the time of the hearing. See Brinkmeyer, 662 S.W.2d at 956. However, the City did not object to its admission as summary judgment evidence. Despite the fact that the City did not object to it, it is irrelevant to our decision, because we do not rely on the hearing officer's opinion regarding Tippy's suspension.
[8] With regard to Tippy's use of ethnic slurs, the hearing officer said:
The evidence before the Appeals Tribunal establishes that the claimant knew, or was responsible for knowing, the rules, regulations, policies, and procedures governing his actions as a police officer for the City of Houston. The Appeals Tribunal finds that although the employer's General Orders restrict the use of the MDT system to `necessary assigned duties,' it has become accepted past practice to use the system for personal communications as well. Therefore, the mere use of the system for personal communications by the claimant, in and of itself, is insufficient to establish misconduct connected with the work.... The claimant's selection of the expression `Ginny Whop' as a generic term for supervisors would have significantly greater credibility if he did not have a previous history of problems with a sergeant and lieutenant of Italian-American heritage. The claimant's inability to spell `Guinea' or `Wop' does not alter the significance of the comment as a racial slur.... These expressions do not violate the regulations prohibiting criticism of the department, as they were neither made publicly nor at an internal official meeting as specified in the regulation. While the expressions do clearly indicate disrespect for superior officers, the regulation also requires courtesy and civility which creates the inference that such regulation refers to personal conduct between the officer and superiors and associates, directly; and no evidence was presented to establish that any direct verbal exchanges between the claimant and any other officers or supervisors created a violation of this rule.... However, the claimant's use of 5% to 13% of his work day on personal non-business related messages on his MDT does represent a violation of the regulations regarding adherence to police duty.
[9] HPD General order 400-21 states any misuse of the MDT system will be considered grounds for disciplinary action. It specifies that the MDT system is intended as an aid to classified employees in the performance of their assigned duties. It goes on to say employees shall limit their transactions and activities to necessary assigned duties.
[10] Rule 2.9 of the HPD Rules Manual states officers shall not devote any of their on-duty time to any activity that is not directly related to the officer's police duties.
[11] In Collingsworth, the issue was whether a nurse's violation of hospital policy while she was off-duty (she assaulted a woman) was misconduct "connected with" her last work. Id. at 709. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534064/ | 991 S.W.2d 90 (1998)
Marco Bence GRONDONA, Santa Cristina Sociedad Anonima, Atahualpa del Monte Sociedad Anonima, and Ignacio Maria Steverlynck, Appellants,
v.
Joseph H. SUTTON, Appellee.
No. 03-98-00454-CV.
Court of Appeals of Texas, Austin.
October 22, 1998.
Rehearing Overruled November 19, 1998.
Released for Publication November 19, 1998.
*91 Robert C. Alden, Bracewell & Patterson, L.L.P., Austin, for Appellants.
Edward P. Watt, Watt & Associates, P.C., Austin, for Appellee.
Before Justices POWERS, ABOUSSIE and KIDD.
PER CURIAM.
Appellants Marco Bence Grondona, Santa Cristina Sociedad Anonima, Atahualpa del Monte Sociedad Anonima, and Ignacio Maria Steverlynck move this Court to deem their appeal timely perfected. Appellee Joseph Sutton moves to dismiss the appeal for want of jurisdiction.
On April 21, 1998, the trial court signed a default judgment against appellants. Appellants timely moved for a new trial on May 21, and the court denied the motion by an order signed on July 15. On August 11, Grondona filed a motion to establish late notice of judgment, asserting that he first had notice of the judgment on May 19. He filed a notice of appeal on the same date. The remaining appellants filed notices of appeal on August 14. Grondona amended his motion to establish late notice of judgment on August 19, and on September 3, the trial court signed an order denying Grondona's motion.
An exception to the rule that procedural timetables run from the date the judgment is signed exists for a party who learns of the judgment more than twenty, but less than ninety, days after it was signed. Tex.R. Civ. P. 306a(4); Tex.R.App. P. 4.2. To benefit from the exception, the party must prove in the trial court, on sworn motion and notice, the date he or his attorney first received notice or acquired actual knowledge of the signing. Tex.R. Civ. P. 306a(5). If evidence at the hearing establishes the date of notice, appellate deadlines and the court's plenary power start from that date rather than the date the judgment was signed. Id. 306a(4); Tex. R.App. P. 4.2(a)(1).
Complying with the provisions of Rule 306a is a jurisdictional requisite. Memorial Hosp. v. Gillis, 741 S.W.2d 364, 365-66 (Tex.1987); In re Simpson, 932 S.W.2d 674, 677 (Tex.App.Amarillo 1996, no writ). The sworn motion serves the purpose of establishing a prima-facie case of lack of timely notice, thereby invoking the trial court's jurisdiction for the limited *92 purpose of holding a hearing to determine the date of notice. Carrera v. Marsh, 847 S.W.2d 337, 342 (Tex.App.El Paso 1993, orig. proceeding). If the movant fails to establish the applicability of the exception in the manner prescribed, the trial court lacks jurisdiction to determine the date of notice and any order doing so is void. Gillis, 741 S.W.2d at 365-66; Simpson, 932 S.W.2d at 678.
We first consider whether Grondona's motion invoked the trial court's jurisdiction to hear evidence to determine the date of notice. Grondona filed his motion eighty-four days after the date he claims to have learned of the default judgment. Neither Rule 306a nor Rule 4 states when a party must move for a determination of late notice. Several courts of appeals have held that a party must file such a motion within thirty days of acquiring notice. See Gonzalez v. Sanchez, 927 S.W.2d 218, 221 (Tex.App.El Paso 1996, no writ); Montalvo v. Rio Nat'l Bank, 885 S.W.2d 235, 237 (Tex.App.Corpus Christi 1994, no writ); Womack-Humphreys Architects, Inc. v. Barrasso, 886 S.W.2d 809, 816 (Tex. App.Dallas 1994, writ denied).
This Court, however, has concluded that a party can file such a motion more than thirty days after receiving notice, as long as he files it within the court's plenary power counted from the date of notice. Vineyard Bay Dev. Co. v. Vineyard on Lake Travis, 864 S.W.2d 170, 172 & n. 1 (Tex.App.Austin 1993, writ denied). In Vineyard Bay, the motion to determine notice was filed thirty-one days after the date of notice but during the court's plenary power, which had been extended by a motion for new trial. Id. Here, Grondona moved for a new trial on May 21, two days after the asserted date of notice, and the trial court overruled the motion on July 15. The court's plenary power would therefore have expired thirty days later on August 14. Grondona's motion, filed on August 11, was timely.
To make a prima-facie case of lack of timely notice, Grondona had to offer evidence that neither he nor his attorney learned of the judgment within twenty days after it was signed. Tex.R. Civ. P. 306a(5); Simpson, 932 S.W.2d at 678; see Tex.R.App. P. 4.2(c). By affidavit attached to the motion, Grondona states that he first received notice of the judgment on May 19. Grondona offered no evidence, however, of when his attorney first learned of the judgment.
On August 19, Grondona filed an amended motion to determine the date of notice. The amended motion includes the affidavit of Grondona's attorney, who avers that he did not know of the judgment until May 19. Grondona therefore could not have made a prima-facie case until the amended motion was filed on August 19, beyond the trial court's plenary power. By failing to offer prima-facie evidence of late notice of judgment during the trial court's plenary power, Grondona did not invoke the court's jurisdiction to determine the date of notice. Barrasso, 886 S.W.2d at 816; Montalvo, 885 S.W.2d at 237-38; see Owen v. Hodge, 874 S.W.2d 301, 303 (Tex.App.Houston [1st Dist.] 1994, no writ).
Even if Grondona had offered prima-facie evidence during the court's plenary power, he failed to obtain a ruling on his motion within that period. See Montalvo, 885 S.W.2d at 237-38; Barrasso, 886 S.W.2d at 816; Conaway v. Lopez, 843 S.W.2d 732, 733 (Tex.App.Austin 1992, no writ). The trial court heard the motion and signed the order overruling it on September 3, beyond the time it would have had power to determine the date of notice of judgment. The order is therefore of no effect.[1]
We conclude that Grondona failed to invoke the trial court's jurisdiction to determine *93 the date of notice of the judgment. His notice of appeal, filed 112 days after the judgment was signed, is thus untimely. See Tex.R.App. P. 26.1. The remaining appellants assert that they have timely appealed because they filed their notices of appeal within fourteen days after Grondona filed his notice of appeal. See id. 26.1(d). Because Grondona's notice of appeal is ineffective to perfect appeal, the remaining notices are likewise ineffective.
We overrule appellants' motion to deem the appeal timely perfected. Because we lack jurisdiction over an appeal that is not timely perfected, we grant Sutton's motion to dismiss the appeal. Davies v. Massey, 561 S.W.2d 799, 800 (Tex.1978). We dismiss the appeal for want of jurisdiction. Tex.R.App. P. 42.3(a).
NOTES
[1] The court found in its order that the date the judgment was signed remained applicable. Having determined that the trial court lacked jurisdiction to render the order, we do not review the finding substantively. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534068/ | 424 A.2d 1072 (1981)
Aram K. BERBERIAN
v.
RHODE ISLAND BAR ASSOCIATION.
No. 77-260-Appeal.
Supreme Court of Rhode Island.
January 30, 1981.
Aram K. Berberian, pro se.
Letts, Quinn & Licht, Richard A. Licht, Robert N. Huseby, Sr., Providence, for Rhode Island Bar Association.
OPINION
MURRAY, Justice.
This is an appeal from an order and judgment of the Superior Court dismissing the plaintiff's suit for mootness on a motion for summary judgment by the defendant bar association. We affirm the judgment of the Superior Court, but for reasons other than those of the trial justice.[1]
The facts may be stated briefly. The plaintiff filed a complaint for mandamus in the Superior Court on April 27, 1977, to compel defendant to enroll him in its medical insurance program, to mail him copies of defendant's publication, and to print therein his "editorial comments." The clerk of the court entered a default against defendant approximately one month later. The defendant immediately filed motions to vacate the default and for entry of summary judgment in its favor on grounds that plaintiff was not a member of the bar association[2] because of his failure to pay membership fees for fiscal years 1975-76 and 1976-77 and was thus not entitled to relief. A justice of the Superior Court granted the motion to vacate the default and denied the motion for summary judgment because there was an issue of fact concerning whether defendant could suspend plaintiff from membership without some action by the Supreme Court.
This court subsequently did act on petitions before it requesting plaintiff's suspension. In Petition of the Rhode Island Bar *1073 Association, 118 R.I. 489, 374 A.2d 802 (1977), we ordered plaintiff's suspension from membership in defendant bar association and from the practice of law unless he paid the arrearages. The plaintiff timely complied, and defendant reinstated plaintiff, conferring the full benefits of membership upon him. The defendant also renewed its motion for summary judgment on the ground that plaintiff had received his requested relief and that the matter was thus moot. A second trial justice granted the motion on mootness grounds, despite plaintiff's testimony at the hearing that he was now in arrears for fiscal year 1977-78 and that he had no intention of paying those dues. The trial justice concluded that plaintiff was free to sue once more.
The issue we confront is that which the first trial justice articulated. We conceive it, however, to be an issue of law, rather than of fact. Can defendant, without the express approval of this court, suspend an attorney from membership on the deny him the benefits of membership on the basis of his refusal to pay dues? The answer is clearly no. In Petition of the Rhode Island Bar Association, 111 R.I. 936, 306 A.2d 199 (1973), we conditioned the unification of defendant association upon the expressed reservation of our right to approve or disapprove in advance any suspension or removal from membership of any attorney proposed by defendant.
The defendant did indeed supersede its authority by suspending plaintiff from membership, although not from practice, when it did. However, in Petition of the Rhode Island Bar Association, 118 R.I. 489, 374 A.2d 802 (1977), we essentially ratified defendant's action.[3] There, we ordered plaintiff to pay his dues within fifteen days or thereafter face suspension. We framed our order prospectively for, although the petitions of defendant nominally dealt with an earlier period, suspension therefor would have had little effect in 1977. Moreover, we made it abundantly clear that "[t]he dues owed the association are a continuing obligation. They are a fee exacted for the privilege of practicing law in this state." Id. at 493, 374 A.2d at 804.
In view of the plaintiff's "continuing obligation" to pay his dues, his failure to do so raises no issue of material fact in the case at bar. The case is more properly dismissed on these grounds than on grounds of mootness. Normally, full payment of arrearages for a past period would cause the case to be moot. However, as the record indicates, the identical problem arose once more after the plaintiff paid his dues for fiscal years 1975-76 and 1976-77 because of his refusal to pay his dues for fiscal year 1977-78. Thus the question that formerly existed concerning the plaintiff's membership rights between fiscal years 1975-76 and 1976-77 continues to exist beyond that period and up to the present time. The question is therefore not moot so long as the plaintiff continues to ignore his "continuing obligation" toward the defendant bar association. See Town of North Kingstown v. North Kingstown Teachers' Association, 110 R.I. 698, 700 n. 1, 297 A.2d 342, 343 n. 1 (1972).
The order of the Superior Court is affirmed, the plaintiff's appeal is denied and dismissed, and the papers are remanded to the Superior Court.
NOTES
[1] Our authority to sustain a correct judgment of a lower court although we do not accept that court's reasoning is by now well established. See Mercier v. City of Central Falls, R.I., 412 A.2d 927 (1980); Souza v. O'Hara, R.I., 395 A.2d 1060 (1978).
[2] Membership is a requirement for admission to practice law in Rhode Island, pursuant to the order for unification of the bar association. Petition of the Rhode Island Bar Association, 111 R.I. 936, 306 A.2d 199 (1973).
[3] For purposes of this appeal alone we do not deal with defendant's premature action, and our acquiescence therein should not be interpreted as a retreat from the relevant part of our order regarding unification. See note 2, supra. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534074/ | 991 S.W.2d 437 (1999)
CMM GRAIN COMPANY, INC., Charlie Myers, Individually d/b/a Charlie Myers Grain Company, Mary Myers, Charlie Myers, Jr., and Alfredo Jaimes, Appellants,
v.
Paul OZGUNDUZ, Appellee.
No. 2-98-156-CV.
Court of Appeals of Texas, Fort Worth.
April 22, 1999.
*438 Charles M. Barnard, Wichita, Chad Williams, Seymour, for appellant.
Bernard A. Guerrini, P.C., and Bernard A. Guerrini, John L. Thompson, Dallas, for appellee.
Before PANEL A: CAYCE, C.J.; DAY and RICHARDS, JJ.
OPINION
JOHN CAYCE, Chief Justice.
CMM Grain Company, Inc., Charlie Myers, individually and d/b/a Charlie Myers Grain Company, Mary Myers, Charlie Myers, Jr., and Alfredo Jaimes (collectively "appellants") appeal the trial court's judgment denying an offset for medical and disability benefits paid to appellee Paul Ozgunduz for an on-the-job injury under an insurance policy issued to Charlie Myers Grain Company. We will affirm the trial court's judgment.
On July 8, 1993, Ozgunduz was injured during the course of his employment with appellant CMM Grain Company, Inc. ("CMMGC, Inc.").[1] Thereafter, Philadelphia American Life Insurance Company paid Ozgunduz approximately $61,000 for his job-related injuries plus disability benefits under an occupational death and disability policy issued to "Charlie Myers Grain Company."[2] Ozgunduz later sued CMMGC, Inc. and the other appellants for negligence, premises liability, negligence per se, and gross negligence, seeking past medical expenses, lost wages, and lost earning capacity as damages. In their answer to the suit, appellants requested an offset against any potential judgment in the amount Philadelphia American paid Ozgunduz under the policy issued to Charlie Myers Grain Company.
The case was tried by a jury. At the conclusion of the trial, the trial court held a hearing on the offset claim which the court later denied by written order. On April 28, 1998, the trial court rendered a joint and several judgment against appellants based on the jury's verdict awarding Ozgunduz damages totaling $166,789.39.
The question we have been asked to decide is whether the trial court erred by *439 refusing to credit appellants with the amount Philadelphia American paid to Ozgunduz under the policy issued to Charlie Myers Grain Company. Before reaching this question, however, we must determine whether appellants have satisfied the requirements for presenting this appeal with a partial reporter's record. In their notice of appeal, appellants stated that they "desire to appeal all rulings and orders of the trial court that dealt with the denial of the offset of benefits." Consequently, the only portion of the reporter's record requested by appellants, and filed by the court reporter, is the hearing on the offset claim. Appellants, however, did not include in their request for the partial reporter's record a "statement of the points or issues to be presented on appeal." Tex.R.App. P. 34.6(c)(1).
Appellate Rule 34.6(c)(1) sets out the exclusive procedures for appealing with a partial reporter's record:
(c) Partial Reporter's Record.
(1) Effect on Appellate Points or Issues. If the appellant requests a partial reporter's record, the appellant must include in the request a statement of the points or issues to be presented on appeal and will then be limited to those points or issues.
Id. This rule allows an appellant to reduce the expense of an appeal by abridging the reporter's record and thereby limit the appellate court's review to only those portions of the record that are relevant to the points raised in the appeal.[3] If an appellant complies with Rule 34.6(c)(1) by including with the request for a partial reporter's record a statement of points or issues to be presented on appeal, the reviewing court must "presume that the partial reporter's record designated by the parties constitutes the entire record for purposes of reviewing the stated points." Id. 34.6(c)(4). If, on the other hand, an appellant fails to comply with Rule 34.6(c), the contrary presumption arises and the reviewing court must instead presume that the missing portions of the record do contain relevant evidence and that the omitted evidence supports the trial court's judgment. See id.
As with its predecessor, Rule 53(d), strict compliance with Rule 34.6(c) is necessary to activate the presumption that the omitted portions of the record are irrelevant. See Christiansen v. Prezelski, 782 S.W.2d 842, 843-44 (Tex.1990) (discussing the necessity of strict compliance with former Rule 53(d)). Generally, this means that both the request for a partial reporter's record and the statement of points must be timely filed and appear in the appellate record.[4]See Schafer, 813 S.W.2d at 155 (discussing former Rule 53(d)). Furthermore, while the terminology of the statement of points need not be exact, the statement should describe the nature of the complained of error with reasonable particularity. See Kwik Wash Laundries, Inc. v. McIntyre, 840 S.W.2d 739, 741 (Tex.App.Austin 1992, no writ).
In the instant case, appellants announced in their notice of appeal the desire to limit their appeal to the trial court's denial of their offset claim. However, neither the notice of appeal nor the request for a partial reporter's record contains any "statement of the points or issues to be presented on appeal." TEX. R.APP. P. 34.6(c)(1). We conclude that a general statement identifying the portion of the judgment appealed from and declaring an intention to appeal that portion of the judgment is insufficient to satisfy the narrow purpose of Rule 34.6(c). We must *440 therefore presume that the omitted portions of the record are relevant to this appeal and that the missing evidence supports the trial court's judgment. See id. 34.6(c)(4); Schafer, 813 S.W.2d at 155.
In their sole point, appellants argue that they are each entitled to an offset against the entire judgment because the purpose of the Philadelphia American policy was to replace workers' compensation insurance and to limit the common law exposure of Ozgunduz's employer in the event of a work-related injury. See Castillo v. American Garment Finishers Corp., 965 S.W.2d 646, 650 (Tex.App.El Paso 1998, no pet.) (judgment against employer may be offset by the amount of benefits paid under an accident policy); Tarrant County Waste Disposal, Inc. v. Doss, 737 S.W.2d 607, 611 (Tex.App.Fort Worth 1987, writ denied) (same). Ozgunduz urges that we affirm the trial court's judgment denying the offset because the policy was issued to Charlie Myers Grain Company and not to Ozgunduz's employer, CMMGC, Inc., or any other named appellant, and thus the policy constituted a collateral source the benefits from which cannot be credited to any appellant. See RESTATEMENT (SECOND) OF TORTS § 920A (1977) (tort-feasor does not get the benefit of payment conferred by another source); see also Brown v. American Transfer & Storage Co., 601 S.W.2d 931, 934 (Tex.) (collateral source rule precludes wrongdoer from receiving credit for insurance procured by another), cert. denied, 449 U.S. 1015, 101 S. Ct. 575, 66 L. Ed. 2d 474 (1980).
Appellants' failure to comply with Rule 34.6(c) is fatal to their appeal. A partial reporter's record unaided by the presumption of Rule 34.6(c)(4) does not provide us with a sufficient record to determine whether the Philadelphia American policy covered any appellant, and, if so, whether the trial court erred in refusing to credit appellants with the amounts paid Ozgunduz under the policy. Because appellants did not comply with Rule 34.6(c), or bring forth a complete reporter's record, we presume the omitted evidence supports the trial court's judgment denying the offset credit and we overrule appellants' point. See Schafer, 813 S.W.2d at 155; Christiansen, 782 S.W.2d at 843.[5]
The trial court's judgment is affirmed.
NOTES
[1] Charlie and Mary Myers are the sole shareholders of CMMGC, Inc., which the jury found to be their alter ego.
[2] The designation of parties shows Charlie Myers Grain Company as the assumed name of appellant Charlie Myers. However, in his answer and response to interrogatories, Mr. Myers alleged that Charlie Myers Grain Company is the assumed name of CMMGC, Inc.
[3] When a request for a partial reporter's record is made, any other party may designate additional exhibits and portions of the testimony to be included in the reporter's record. See id. 34.6(c)(2).
[4] Although Rule 34.6(c)(1) indicates that the statement of points must be included "in" the request for a partial reporter's record, the rule is complied with if the statement of points is filed in a separate document with the request. See Schafer v. Conner, 813 S.W.2d 154, 155 (Tex.1991).
[5] We note that the trial court excluded on relevancy grounds a letter dated October 3, 1991, from Charlie Myers to the Texas Workers' Compensation Commission which suggests that the policy may have been purchased by CMMGC, Inc. and issued under CMMGC, Inc.'s assumed name, Charlie Myers Grain Company. Appellants, however, do not challenge the exclusion of this letter on appeal, and, as a result, we cannot consider it. See San Jacinto River Auth. v. Duke, 783 S.W.2d 209, 210 (Tex.1990); Allright, Inc. v. Pearson, 735 S.W.2d 240, 240 (Tex.1987). Even if we were permitted to consider the letter in determining whether the policy covered CMMGC, Inc., we must nevertheless presume that the remainder of the reporter's record contained evidence supporting the trial court's judgment. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534075/ | 273 B.R. 481 (2001)
In re Annette D. CARLSON, Debtor.
Annette D. Carlson, Plaintiff,
v.
UNIPAC Student Loan, Defendant.
Bankruptcy No. 00-07519/W. Adversary No. 00-80255/W.
United States Bankruptcy Court, D. South Carolina.
May 18, 2001.
*482 Jan M. Baker, King and Dalrymple, PA, West Columbia, SC, for debtor.
ORDER
JOHN E. WAITES, Bankruptcy Judge.
THIS MATTER comes before the Court upon a Complaint to Determine Dischargeability of Debts filed by Annette D. Carlson ("Plaintiff" or "Debtor") on November 20, 2000. Debtor seeks to discharge a debt in the amount of $6,802.46 owed to Educational Credit Management Corporation ("ECMC"), successor in interest to UNIPAC Student Loan pursuant to 11 U.S.C. § 523(a)(8).[1] After reviewing the pleadings in this matter, considering the evidence presented, and hearing the arguments of counsel at the trial on the merits; the Court makes the following Findings of Fact and Conclusions of Law pursuant to Fed.R.Civ.P. 52, made applicable to bankruptcy proceedings by Fed. R. Bankr.P. 7052.[2]
FINDINGS OF FACT
1. Plaintiff is a forty-nine-year-old divorced mother of two. After her divorce in 1986, Plaintiff was awarded custody of her two minor children. Plaintiff's former spouse was ordered to pay support, but Plaintiff received it only sporadically.
2. Shortly after Plaintiff's divorce, she received her GED and enrolled in a junior college. Thereafter, she transferred to a four-year university, and, despite a learning disability and the responsibility of caring for her children, earned academic honors and received a Bachelor of Science in Secondary Education Social Sciences.
3. While pursuing her degree, Plaintiff obtained guaranteed student loans from the Nebraska Student Loan Program. The guaranteed student consolidated loans at issue were originally disbursed by the Nebraska Student Loan Program in four payments occurring in November 1989, January 1990, November 1990, and January 1991. The total principal amount disbursed was $6,402.00. ECMC, successor in interest to UNIPAC Student Loan, is the current owner and holder of the loans at issue.[3]
4. The repayment period on the loans began September 26, 1992. Plaintiff requested and received forbearances on the loan payments for the periods of September 1992 through May 1994, December 1997 through August 1998, October 1998 through June 1999, September 1999 through February 2000, and March 2000 *483 through November 2000. However, Plaintiff made her regular payments between the forbearance periods. She made her last payment on the student loans on September 18, 1998, after which she defaulted on her student loan obligations.
5. On August 16, 1999, Plaintiff was involved in an automobile accident and suffered a brain and spinal concussion. Plaintiff's physician has advised Plaintiff that she will never again be capable of holding full-time employment due to her medical conditions caused as a result of the accident.
6. Since the automobile accident, Plaintiff has had a succession of odd jobs, including a position as a vacuum sales person, a radio promoter, and a carpenter. However, due to the injuries she sustained in the automobile accident, Plaintiff has been unable to hold a permanent job. Plaintiff's current income is derived from part-time baby-sitting at the rate of $115.00 per week and a $300.00 contribution from her father each month.[4]
7. At trial, evidence was introduced reflecting Plaintiff's efforts to secure employment. In fact, she introduced copies of multiple cover letters which had been mailed to various employers seeking various job openings. However, up to this time, Plaintiff has been unsuccessful in securing any position, and she testified that her medical conditions which resulted due to the car accident have significantly limited her ability to work.
8. On August 28, 2000, Plaintiff filed a petition for relief under Chapter 7 of the United States Bankruptcy Code. Plaintiff filed this Adversary Proceeding on November 20, 2000, seeking to have the student loans at issues declared dischargeable pursuant to § 523(a)(8).
9. At trial in this matter, Plaintiff demonstrated to the Court that she was not able to afford housing and she currently resides with a friend. Her monthly income, including the $300.00 per month that her father sends her, is approximately $760.00 per month; while her monthly expenses, including medical expenses, are approximately $739.00 per month.
CONCLUSIONS OF LAW
The issue before the Court is whether Plaintiff's student loans owed to ECMC, successor in interest to UNIPAC Student Loan are dischargeable pursuant to § 523(a)(8).[5]
Section 523 (a)(8) of the Bankruptcy Code provides as follows:
(a) A discharge under Section 747, 1141, 1228(a), 1228(b) or 1328
(b) of this title does not discharge an individual debtor from any debt . . .
(8) for an education benefit overpayment or loan made, insured or guaranteed by a governmental unit, or made under any program funded in whole or in part by a governmental unit or nonprofit institution, or for an obligation to repay funds received as an education benefit, scholarship or stipend, unless excepting such debt from discharge under this paragraph will impose an undue hardship on the debtor and the debtor's dependents.
11 U.S.C. § 523(a)(8).
In the District of South Carolina, the appropriate test for determining *484 whether the repayment of a student loan constitutes an undue hardship on the debtor is outlined in the case of Ammirati v. Nellie Mae, Inc. (In re Ammirati), 187 B.R. 902 (D.S.C.1995); aff'd 85 F.3d 615 (4th Cir.1996); see also Myers v. Sallie Mae Student Loans, et al. (In re Myers), C/A No. 00-08859-W; Adv. Pro. No. 00-80274-W (Bankr.D.S.C.5/14/2001); McCormack v. Educational Credit Management Corp. (In re McCormack), C/A No. 99-10637-W; Adv. Pro. 99-80401-W (Bankr.D.S.C.7/3/2000). In order to establish that the repayment of a student loan constitutes a hardship on the debtor pursuant to the Brunner test adopted in In re Ammirati, the debtor must establish the following:
(1) that the debtor cannot maintain, based on current income and expenses, a "minimal" standard of living for herself and her dependents if forced to repay the loans;
(2) that additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and
(3) that the debtor has made good faith efforts to repay the loans.
In re Ammirati, 187 B.R. at 904 (citing Brunner v. New York State Higher Educ. Services Corp., 831 F.2d 395 (1987)); see also Grine v. Texas Guaranteed Student Loan Corp. (In re Grine), 254 B.R. 191, 197 (Bankr.N.D.Ohio 2000) ("[T]he Court observes that it is the Debtor who bears the burden to prove, by a preponderance of the evidence, that each one of the Brunner requirements have been satisfied."); Greco v. Sallie Mae Serv. Corp. (In re Greco), 251 B.R. 670, 675-76 (Bankr.E.D.Pa.2000) ("The burden of establishing each prong of the Brunner test lies with the debtor.").
The Court finds that the Plaintiff has demonstrated that the repayment of her student loan would cause her undue hardship. As to the first prong of the Brunner test, "`[t]he bankruptcy court must determine what amount is minimally necessary to ensure that the debtor's needs for care, including good, shelter, clothing, and medical treatment are met. . . . Once that determination is made, the question is whether the debtor has any additional funds with which to make payments toward his or her student loan obligations.'" McCormack v. Educational Credit Management Corp. (In re McCormack), C/A No. 99-10637-W; Adv. Pro. 99-80401-W (Bankr.D.S.C.7/6/2000) (quoting Salinas v. United Student Aid Funds, Inc. (In re Salinas), 240 B.R. 305, 314 (Bankr.W.D.Wis.1999)). In this case, the parties agreed that the first requirement was met in that, based on her current income and her modest monthly budget, Plaintiff would not be able to maintain a minimal standard of living.[6] Thus, the issues remaining before the Court and which are in dispute among the parties are whether Debtor's conditions and inability to repay the loan are likely to persist in the future, and whether she has made good faith efforts to repay the loans at issue.
*485 As to the first issue, the Court finds that circumstances are present in this case to indicate that Plaintiff's inability to repay will persist for a significant portion of the loan repayment period. In determining the second prong of the Brunner test, the Court must consider whether the circumstances that prevent the debtor from being able to make the student loan payments are temporary or whether they are likely to persist into the future. As the Court noted in the case of Salinas v. United Student Aid Funds, Inc. (In re Salinas), 240 B.R. 305 (Bankr.W.D.Wis.1999):
The requirement that there be some "additional circumstances" which indicate that the debtor will be unable to make payments does not mean that only those debtors who are elderly or disabled can obtain a discharge. . . . In considering the debtor's future financial prospects, the financial, physical, or mental hardship which may have precluded the debtor's current or past ability to address the debt must appear likely to continue indefinitely into the future.
Id. at 314-15. In this case, as a result of her medical condition, Plaintiff has been unable to secure steady employment since her automobile accident in 1999. Furthermore, Plaintiff testified that her physician has advised that Plaintiff will never again be able to be employed full time. Due to the permanent debilitating nature of her injuries, the Court finds that the Plaintiff's income is not likely to increase to a level that would allow her to repay her student loans.
Finally, the Court finds that Plaintiff did make a good faith effort to repay the loan. In considering whether a debtor has acted in good faith in the repayment of his or her student loans, the following factors are usually considered:
(1) whether the debtor attempts to repay the debt;
(2) the length of time after the student loan becomes due that the debtor seeks to discharge the debt;
(3) the percentage of the student loan debt in relation to the debtor's total indebtedness;
(4) the debtor's attempts to find suitable employment.
McCormack v. Educational Credit Management Corp. (In re McCormack), C/A No. 99-10637-W; Adv. Pro. 99-80401-W (Bankr.D.S.C.7/6/2000) (quoting Green v. Sallie Mae Serv. Corp. (In re Green), 238 B.R. 727, 736 (Bankr.N.D.Ohio 1999)). In this case, despite the fact that Plaintiff requested and received multiple forbearances on her loan repayment, she did in fact make the payments faithfully between the forbearance periods. Despite her personal difficulties, Plaintiff never fully abandoned her obligation to repay her student loan debt; rather, she paid when she could, sought forbearances when she was unable to make the payments, and kept the student loan lender informed about her financial situation. Furthermore, she has diligently been seeking employment but has been unsuccessful in obtaining a job.
Defendant argued that Debtor cannot meet her burden of proof that the payment of the subject loans would be an "undue hardship" and specifically cannot meet the requirements of the third prong because she may have the opportunity to consolidate her outstanding student loans under an Income Contingent Repayment Program ("ICRP"). At trial, Defendant argued that ICRP loans are available through the U.S. Department of Education, which permit a student loan debtor to pay 20% of the difference between his or her adjusted gross income and the poverty level for her family size or the amount the debtor would pay if the debt were *486 repaid in 12 years, whichever is less. A debtor's payments could be as low as $0.00, which amount would be subject to adjustment each year based upon the then current balance on the loan as well as the current adjusted gross income. Defendant cited some recent cases in support of her arguments; however, this Court notes that theses cases are distinguishable from the one before it. See, e.g. United States Dept. of Educ. v. Wallace (In re Wallace), 259 B.R. 170 (C.D.Cal.2000); Douglass v. Great Lakes Higher Educ. Serv. Corp. (In re Douglass), 237 B.R. 652 (Bankr.N.D.Ohio 1999). Both cases address the issue of good faith and focus on whether the debtor ever attempted to negotiate an alternate repayment plan with their lender. For example, in In re Wallace the court noted that an important factor to consider is the debtor's effort to negotiate a repayment plan or seek a deferment on her or his loan from the educational lender. See, e.g. id. at 185 ("It is unclear whether Wallace ever attempted to negotiate coordinated payments with Education and Hemar. Nor does anything in the record suggest that he never applied for, or inquired about, the `alternate' plan that the Department's lawyer described several times at the motions hearings."); see also In re Douglass, 237 B.R. at 657 ("Not only has the Debtor failed to make a payment on the loan, she has made no attempt to negotiate any repayment schedule which would accommodate her means.").[7] In this case Debtor has asked for forbearances and for various deferral. Furthermore, there is no evidence that Debtor would be qualified for the ICRP Program and there is no proof that Debtor was advised of such option in time for her to properly respond to it or consider it as an option.
The Court disagrees with Defendant's implication that it is Plaintiff's responsibility to seek out every possible alternative payment plan available before she can meet the burden of demonstrating good faith. It is conceivable that there might be a charitable foundation in existence that would possibly provide Debtor with financial assistance; however, the Court is of the opinion that to put a debtor to the impossible burden to seek out every possible program in existence was not contemplated by Congress when § 523(a)(8) was enacted. Lastly, the Court notes that under the program proposed by Defendant, while the educational lender may be paid in full by the Federal Government, Debtor would in turn be indebted to the Federal Government. Debtor would, in essence, be trading debt for debt, without any relief despite meeting the burden of proof on the three requirements of the Brunner test.
In light of these findings and after hearing the credible and persuasive testimony of Plaintiff, the Court concludes that the Brunner test for establishing that the repayment of Debtor's student loan will cause her undue hardship has been met. Thus, the student loan debt is dischargeable pursuant to § 523(a)(8). Based on the foregoing, it is
ORDERED that the student loan owed by Annette D. Carlson to Education Credit Management Corporation, successor in interest to the named Defendant UNIPAC Student Loan, is discharged pursuant to § 523(a)(8).
IT IS SO ORDERED.
NOTES
[1] Further references to the Bankruptcy Code shall be by section number only.
[2] The Court notes that to the extent any of the following Findings of Fact constitute Conclusions of Law, they are adopted as such; and to the extent any Conclusions of Law constitute Findings of Fact, they are so adopted.
[3] The Complaint filed on November 20, 2000 also sought the dischargeability of the student loan owed to Colorado Student Loan Program in the amount of $539.00. However, Defendant Colorado Student Loan Program failed to file an answer to the Complaint; therefore, the debt owed by Plaintiff to that defendant was discharged by virtue of an Order of Default entered February 28, 2001.
[4] At the trial, Plaintiff testified that her father is 87 years old and not independently wealthy. Furthermore, he is presently struggling with cancer; therefore, his financial help that he provides to his daughter is likely to cease in the near future.
[5] There is no question that the loan at issue in this case is the type of educational loan "insured or guaranteed by a governmental unit, or made under any program funded in whole or in part by a governmental unit or nonprofit institution" as required in § 523(a)(8).
[6] Debtor testified that her monthly income is approximately $760.00 per month, while her monthly expenses total approximately $739.00 per month. Her present income includes the $300.00 per month that her eighty-seven-year-old father who has cancer gives her. Debtor is not able to afford housing and is currently living with a friend. Despite the fact that she is technically qualified for unemployment benefits, she explained that she cannot draw such benefits. Furthermore, her medical conditions have caused her to incur many medical bills. Even though she has been declared indigent by her medical provider, and thus a large portion of her medical bills have been forgiven, she is still responsible for a portion of those and incurs additional monthly expenses for her medications.
[7] In In re Douglass the Court also seemed to indicate that the ICRP program is available only for loans held by the Department of Education. Id. at 657 ("ICRP repayment terms are available for most defaulted loans held by the Department of Education."). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534070/ | 991 S.W.2d 671 (1999)
STATE of Missouri, Appellant,
v.
Marc A. McFALL, Respondent.
No. WD 54945.
Missouri Court of Appeals, Western District.
April 20, 1999.
*672 Dawn M. Parsons, Asst. Pros. Atty., Kansas City, for appellant.
Vince Esposito, Kansas City, for respondent.
Before BRECKENRIDGE, C.J., ELLIS and HANNA, JJ.
PATRICIA BRECKENRIDGE, Chief Judge.
The State appeals from the trial court's order sustaining defendant Marc McFall's motion to suppress. The State contends that the police had reasonable suspicion to conduct a protective search for weapons of Mr. McFall's car after observing him make furtive movements during a routine traffic stop. Deferring to the trial court's credibility determinations and considering all of the facts and inferences in the light most favorable to the trial court's order, this court finds that the trial court's order suppressing the seized evidence is not clearly erroneous. Therefore, the order of the trial court suppressing the seized evidence is affirmed.
Factual and Procedural Background
On April 30, 1997, Officers Kurtis Schmidt and Stuart Carpenter were on tactical response patrol in Kansas City, Missouri. At around 4:30 p.m. on that day, as Mr. McFall left his girlfriend's residence, he observed the officers in a parked patrol car a block and a half down the street from his girlfriend's residence. Mr. McFall got into his vehicle and started driving down the street. By the time Mr. McFall got to the corner, the police officers had caught up to his vehicle and were following behind him. The officers observed Mr. McFall make a turn at the corner without signaling. The officers then activated their lights and siren, signaling for Mr. McFall to stop. Mr. McFall pulled his vehicle over immediately.
At the suppression hearing, Officer Schmidt testified that after Mr. McFall pulled over, the officers observed him glance over each of his shoulders a couple of times, lean back in the driver's seat as if he were removing something from his pants, and then lean forward, almost out of view, as if he were putting something under the seat. Mr. McFall testified, however, that after he pulled over, he did not take anything out of his waistband, he did not place anything under the seat, and he did not lean forward and put his hands under the seat. He testified that about five minutes passed from the time of the stop until the officers approached the car, with one on each side, and removed Mr. McFall from the vehicle.
After Mr. McFall exited his vehicle, Officer Carpenter took Mr. McFall to the rear of his car and gave him a quick pat down to ensure he was unarmed. Following the pat down, Officer Schmidt went to the front of the vehicle and searched under the driver's seat, where he testified he had seen Mr. McFall put something. As a result of the search, Officer Schmidt found a clear plastic bag which held numerous small bags containing a white, rock-like substance. The substance was field-tested and the officers determined the substance was cocaine. Mr. McFall was then arrested for possession of narcotics and cited for failing to signal before turning. He was later indicted for trafficking drugs in the second degree and, in an amended information, he was charged as a prior drug offender.
Following the institution of charges against Mr. McFall, he filed a motion to suppress the evidence seized from his car. Mr. McFall alleged that the search violated the Fourth Amendment to the United States Constitution because it was not conducted incident to a custodial arrest, it was not necessary to ensure the officers' safety, and it was not supported by probable cause or reasonable suspicion. In its response, the State argued that the search was a proper protective sweep because Mr. *673 McFall's motions in the car, subsequent to the lawful stop, gave rise to the officer's reasonable suspicion that Mr. McFall was armed and potentially dangerous. On September 10, 1997, the circuit court of Jackson County conducted a hearing on Mr. McFall's motion to suppress. After taking the matter under advisement, the trial court granted Mr. McFall's motion to suppress on September 11, 1997.
Subsequently, the State filed a timely interlocutory appeal to this court pursuant to § 547.200.4, RSMo 1994, and Missouri Supreme Court Rules 21.01 and 30.02.[1]
Standard of Review
A trial court's ruling on a motion to suppress may be reversed only if it is clearly erroneous. State v. Slavin, 944 S.W.2d 314, 317 (Mo.App.1997). Appellate review is limited to a determination of whether the trial court's ruling is supported by sufficient evidence from the record as a whole. Id. In reviewing a trial court's order on a motion to suppress, this court considers all facts and reasonable inferences in the light most favorable to the challenged order. State v. Taylor, 965 S.W.2d 257, 260 (Mo.App.1998). The appellate court must defer to the trial court's determination as to the credibility of witnesses. State v. Schieber, 760 S.W.2d 557, 559 (Mo.App.1988). This court may not substitute its discretion for that of the trial court when reviewing an order suppressing evidence. Taylor, 965 S.W.2d at 260. Nonetheless, "we must consider the ruling in light of the proper application of the precepts of the Fourth Amendment." Id. (internal quotations omitted). The ultimate issue of whether the Fourth Amendment was violated is a question of law which this court reviews de novo. Slavin, 944 S.W.2d at 317.
No Reasonable Suspicion to Search
On appeal, the State argues that the trial court erred in sustaining Mr. McFall's motion to suppress because the evidence was sufficient to conclude that the search was "supported by law" since the officer had a reasonable suspicion to conduct a protective sweep of the automobile.[2] Mr. McFall counters that the search was not supported by reasonable suspicion because he made no furtive gestures during the stop. He reasons that because the trial court sustained his motion to suppress and on appeal, the evidence must be viewed in the light most favorable to the ruling, this court must review this case assuming the trial court believed his testimony regarding the stop. He maintains that this court is bound by the facts as he presented them at trial.
The standard for evaluating the constitutionality of a protective search of an automobile, incident to a stop for a traffic violation, is set out in Michigan v. Long, 463 U.S. 1032, 1049-50, 103 S. Ct. 3469, 3481, 77 L. Ed. 2d 1201 (1983).[3] In Long, the United States Supreme Court *674 examined whether and when an officer may search a vehicle stopped for a routine traffic violation for weapons to protect the safety of the officer. Id. Likening the roadside stop of a vehicle to a Terry[4] investigative stop of a person, the Court found that concerns for officers' safety in both situations justified protective searches for weapons when the police suspected that the subject may be armed and dangerous. Id. The Court explained, "A Terry search, `unlike a search without a warrant incident to a lawful arrest, is not justified by any need to prevent the disappearance or destruction of evidence of crime.... The sole justification of the search ... is the protection of the police officer and others nearby.... `"Id. at 1049, 103 S.Ct. at 3481 n. 14 (quoting Terry, 392 U.S. at 29, 88 S.Ct. at 1884). This justification holds true even if the suspect is outside of the car during the stop. Id. at 1051, 103 S.Ct. at 3482. Although outside of the car and in the brief control of a police officer, a suspect might still be able to "break away from police control and retrieve a weapon from his automobile," or if the suspect is not placed under arrest, "he will be permitted to reenter his automobile, and he will then have access to any weapons inside." Id. at 1051-52, 103 S.Ct. at 3482.
A Terry protective search of an automobile is justified only if the police officer possesses a reasonable belief based on specific and articulable facts, as well as the reasonable inferences from those facts, that his safety or that of others is in danger. Id. at 1049-50, 103 S.Ct. at 3481. The issue is whether a reasonably prudent person in similar circumstances would believe that the suspect was dangerous. Id. at 1050, 103 S.Ct. at 3481. See also State v. Kovach, 839 S.W.2d 303, 310 (Mo.App. 1992) (protective search justified when the facts available to the officer "warrant a man of reasonable caution in the belief that the action taken was appropriate"). For the protective search of a vehicle to be justified in light of the Fourth Amendment, the police must objectively believe that "the suspect is dangerous and the suspect may gain immediate control of weapons." Long, 463 U.S. at 1049, 103 S.Ct. at 3481.
Many jurisdictions have addressed whether "furtive gestures" by a vehicle's occupants during a traffic stop support a reasonable suspicion that the occupants are armed and potentially dangerous. See 4 WAYNE R. LAFAVE, SEARCH AND SEIZURE, Sec. 9.5(e), at 293 n.247 (3d ed.1996) (collection of federal and state cases finding furtive movements support reasonable suspicion). Generally, movement indicating that a driver is attempting to conceal something in the car is found to support an officer's reasonable suspicion that the driver may have a weapon. See id. In Missouri, a driver's suspicious movements in an automobile have been held to support reasonable suspicion to search for weapons. State v. Hunter, 783 S.W.2d 493, 495-96 (Mo.App.1990). In Hunter, a protective search was upheld where an officer conducted a protective search after observing activity inside the vehicle, where the driver lunged toward the passenger and then returned to an upright position and the passenger then ducked completely out of view. Id. The court held that the activity observed by the officer would warrant a reasonably prudent man to believe that his safety was in danger. Id. at 496.
In this case, Officer Schmidt testified that he and Officer Carpenter stopped Mr. McFall for failing to signal before turning. After Mr. McFall pulled over, but before the officers approached his car, Mr. McFall glanced over each of his shoulders a couple of times, leaned back in the driver's seat as if he were removing something from his pants, and then leaned forward as though he were putting something under his seat. Officer Schmidt testified that Mr. McFall's movements in the car made the officers believe that Mr. McFall had *675 placed a gun or something under the seat. He further testified that, when the officers approached Mr. McFall's vehicle, they immediately removed Mr. McFall from the vehicle for their safety, in the event it was a gun that Mr. McFall had placed under his seat. In this testimony, Officer Schmidt articulated a reasonable suspicion that, based upon Mr. McFall's furtive gestures after the stop, a search for weapons was necessary to protect the officers' safety. Thus, if Officer Schmidt's testimony is taken as true, the search was justified under Long and Hunter.
Pursuant to the standard of review, however, this court must defer to the trial court's credibility determinations and view the evidence in the light most favorable to the trial court's granting of the motion to suppress. Taylor, 965 S.W.2d at 260; Schieber, 760 S.W.2d at 559. Mr. McFall testified, essentially, that he did not make any furtive gestures after the stop. He testified that after he pulled over, he did not take anything out of his waistband, he did not put anything under the seat, and he did not lean forward and put his hands under the seat. Deferring to the trial court's credibility determinations, this court must disregard Officer Schmidt's testimony and assume that the trial court believed Mr. McFall's account of his actions after the stop. Viewing the evidence in the light most favorable to the trial court's ruling, the trial court did not err in granting the motion to suppress.[5]
Accordingly, the trial court's order suppressing the evidence is affirmed.
HANNA, J., concurs.
ELLIS, J., concurs in a separate opinion.
ELLIS, Judge, concurring.
I concur in the reasoning used, and the result reached, in the majority opinion. However, I respectfully decline the opportunity to join in the majority's obiter dictum to the effect that had the trial court believed the state's furtive gestures testimony, then the search in this case was legal.
In Muench v. South Side Nat. Bank, 251 S.W.2d 1 (Mo.1952), our Supreme Court stated:
`An obiter dictum, in the language of the law, is a gratuitous opinionan individual impertinencewhich, whether it be wise or foolish, right or wrong, bindeth none, not even the lips that utter it.' Hart v. Stribling, 25 Fla. 433, 435, 6 So. 455. Or as classically expressed by Judge Caskie Collet, it is "`That useless chatter of judges, indulged in for reasons known only to them, to be printed at public expense.'" United States v. Certain Land in City of St. Louis, D.C., 29 F. Supp. 92, loc. cit. 95 [(1939)].
Muench, 251 S.W.2d at 6. Under our standard of review, we must disregard Officer Schmidt's "furtive gestures" testimony. In reviewing a trial court's order on a motion to suppress, the facts and all reasonable inferences arising therefrom "are to be stated favorably to the trial court's order," State v. Franklin, 841 S.W.2d 639, *676 641 (Mo. banc 1992) (emphasis added), and all contrary evidence and inferences must be disregarded. State v. Blair, 691 S.W.2d 259, 260 (Mo. banc 1985) (emphasis added). Thus, any "what if" speculation about what the result would be "if Officer Schmidt's testimony is taken as true," Maj. Op. at 675, is irrelevant to disposition of the instant appeal. "Judicial opinions are meant to resolve legal disputes. Therefore, an appellate court does not decide and should suppress its instructive instincts and not discuss issues which are irrelevant and unimportant to resolution of the legal dispute presented." Coalition to Preserve Educ. On the Westside v. School Dist. Of Kansas City, 649 S.W.2d 533, 536 (Mo. App. W.D.1983).
The instant appeal is a poster child for the wisdom of the rule against deciding issues irrelevant to resolution of the pending case. It must be recalled that the undisputed evidence in this case was that the police officers waited approximately five minutes after they stopped Mr. McFall's vehicle until they exited the police car and approached his vehicle. I can see a very significant potential for abuse if law enforcement officers are permitted to use "furtive gestures" by a defendant to justify a search, when those movements are made during a protracted delay, caused by the officers, between the stop of the vehicle and the officers approaching it. It is only reasonable for a driver waiting that long for the officers to approach his car to be looking over his shoulder, becoming anxious and acting nervously. For this reason, if no other, discussion and decision of that issue should be left to a case in which it is presented. Ultimately, however, the saving grace is that dictum has no controlling or precedential value.
The statements ... are obiter dicta in that they were not essential to the court's decision of the issue before it. Accordingly, the statements are not controlling on this court. "Any reported opinion should be read in the light of the facts of that particular case, and it would be unfair as well as improper `to give permanent and controlling effect to casual statements outside the scope of the real inquiry.'"
Campbell v. Labor and Indus. Relations Com'n, 907 S.W.2d 246, 251 (Mo.App.W.D. 1995) (Citations omitted).
NOTES
[1] Mr. McFall argues the State did not file a timely appeal. The order granting Mr. McFall's motion to suppress was entered on September 11, 1997. The State's notice of appeal was filed on September 18, 1997. Section 547.200, RSMo 1994 requires the State's notice of appeal be made within five days following the trial court's ruling on the motion to suppress. The State complied with the timeliness requirement because Rule 20.01 provides that for time periods less than seven days, Saturday, Sunday, and legal holidays shall be excluded from the time computation. Excluding Saturday and Sunday, September 13 and 14, September 18 was the fifth day following the entry of the order to suppress. Because the State filed its notice of appeal on September 18, the State's notice of appeal was timely.
[2] The State does not argue that the search was justified by probable cause, which is necessary for the police to search a vehicle for contraband. Therefore, this court will not address whether these facts would give rise to probable cause.
[3] Mr. McFall does not argue the constitutionality of the initial stop. Officers are authorized to stop drivers to issue a traffic summons. See State v. Burkhardt, 795 S.W.2d 399, 405 (Mo. banc 1990).
[4] Terry v. Ohio, 392 U.S. 1, 88 S. Ct. 1868, 20 L. Ed. 2d 889 (1968).
[5] At the close of the motion hearing, the judge made comments that indicate that he may not have ruled upon the credibility of the witnesses because of a misunderstanding of the law permitting protective searches upon the observation of furtive movements. Specifically, the judge stated that he thought the evidence justifying the protective sweep was "extremely thin," and that he was "not sure that there is a reasonable articulable suspicion of any criminal activity, even given the motions that were described by the police officer." (emphasis added). Because these comments did not constitute findings of fact, see Schieber, 760 S.W.2d at 559, this court does not consider whether the trial court's statements mean it did or did not believe the police officer's testimony. This court merely accepts the facts in the light most favorable to the order sustaining the motion to suppress. However, if the facts recited, based upon the standard of review, do not accurately reflect the trial court's holding, the trial court can rectify this because the trial court's ruling on the motion to suppress evidence is interlocutory. See State v. Milliorn, 794 S.W.2d 181, 187 n. 4 (Mo. banc 1990). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534066/ | 492 Pa. 424 (1981)
424 A.2d 1263
COMMONWEALTH of Pennsylvania,
v.
Richard P. BRIGHTWELL, Appellant.
Supreme Court of Pennsylvania.
Argued October 13, 1980.
Decided January 30, 1981.
Roy Davis, Asst. Public Defender, for appellant.
*425 David E. Fritchey, Chief, Appeals Unit, Asst. Dist. Atty., for appellee.
Before O'BRIEN, C.J., and ROBERTS, NIX, LARSEN, FLAHERTY and KAUFFMAN, JJ.
OPINION OF THE COURT
O'BRIEN, Chief Justice.
Appellant, Richard P. Brightwell, was convicted of, inter alia, both murder of the third degree and voluntary manslaughter for the June 24, 1974 shooting killing of Nanny Brown. Before the trial court accepted these obviously inconsistent verdicts, he called opposing counsel to sidebar and stated that "It is my understanding that the verdict in this case would be recorded as guilty of murder of the third degree. . . . Do you agree to that?" When both counsel agreed, the trial court announced that appellant had been found guilty of murder of the third degree. No objection was taken by appellant. New counsel represented appellant at post-verdict motions, which were denied. Appellant was sentenced to ten-to-twenty years imprisonment. On direct appeal, while represented by the same counsel as on post-verdict motions, appellant argued the inconsistent verdict issue, but we held the issue had been waived because of appellant's failure to either object at trial or to assert the ineffectiveness of trial counsel. Commonwealth v. Brightwell, 479 Pa. 541, 388 A.2d 1063 (1978).
Appellant subsequently filed a petition pursuant to the Post Conviction Hearing Act, alleging, inter alia, that both trial and appellate counsel had been ineffective for failing to preserve the claim concerning the inconsistent verdicts. Following an evidentiary hearing, the court denied appellant's requested relief and this appeal followed.
Appellant argues instantly that trial counsel was ineffective for failing to object to the trial court's actions in ordering the verdict be recorded as guilty of murder of the third degree. Appellant further argues that appellate counsel was ineffective for failing to challenge the effectiveness *426 of trial counsel at both post-verdict motions and on direct appeal. See Commonwealth v. Dancer, 460 Pa. 95, 331 A.2d 435 (1975).
Our standard of review involving claims of ineffective assistance of counsel is by this time well-settled. As this Court unanimously stated:
"In order to determine whether counsel's assistance was effective, we must be `able to conclude the particular course chosen by counsel had some reasonable basis designed to effectuate his client's interests.' Commonwealth ex rel. Washington v. Maroney, 427 Pa. 599, 604, 235 A.2d 349, 352 (1967). [Emphasis in original.] However, counsel cannot be found ineffective for failing to assert a meritless claim. Only when an abandoned claim is of arguable merit must we inquire into counsel's basis for not pursuing it. Commonwealth v. Sherard, 483 Pa. 183, 394 A.2d 971 (1978); Commonwealth v. Hubbard, 472 Pa. 259, 372 A.2d 687 (1977)."
Commonwealth v. Weathers El, 485 Pa. 28, 32, 400 A.2d 1295, (1979). It is thus incumbent upon us to determine whether appellant's claim concerning the inconsistent verdict was of arguable merit.
Appellant argues that the jury's verdict finding him guilty of both murder of the third degree and voluntary manslaughter for the same killing was inconsistent. As appellant correctly points out, the major difference between murder of the third degree and voluntary manslaughter is the absence of malice in the latter. We believe appellant's claim clearly has arguable merit, as evidenced by this Court's statement on appellant's direct appeal:
"Had appellant objected and the court determined the verdict was inconsistent, the court could have directed the jury to retire and reconsider its verdict. Commonwealth v. Johnson, 369 Pa. 120, 85 A.2d 171 (1952); Commonwealth v. Micuso, 273 Pa. 474, 117 A. 211 (1922)."
Commonwealth v. Brightwell, supra, 479 Pa. at 547, 388 A.2d 1063.
*427 Believing appellant's claim to be of arguable merit, we must proceed to the second step of our analysis; we must determine if appellant's trial counsel had any reasonable basis designed to effectuate appellant's interest by not objecting to the inconsistent verdicts.
At the evidentiary hearing on appellant's P.C.H.A. petition, his trial counsel testified as follows:
". . . I was relieved when they found him not guilty of the first degree charge. My recollection is that we went to side bar and as Richard indicated the Judge said that obviously it was voluntary manslaughter being part and parcel of third degree homicide did we agree that it was the intention of the jury was to find him guilty of third degree murder and I agreed. I made no objection. It seemed reasonable to me at the time. I cannot, I don't know that I can go back and put myself in that place and second-guess whether I did the right thing or wrong thing at that time. It seemed to be the right thing at the time. That's all I can say bout it.
Trial counsel also responded to the following question by the prosecutor:
"Q. Would you be able to say that anything was to be gained by letting the jury go back in the retirement room and deliberate?
"A. Since the Clerk had not recorded the verdict and the Judge had not accepted any verdict at that time I didn't want to give the jury another opportunity to go out and come back with first degree murder. I wanted the jury since they had the opportunity to review the entire verdict, the Clerk hadn't recorded the verdict, it hadn't been made part of the record, he was either going to have the verdict come in at third degree or have the jury go back and consider it. My only consideration was that I didn't want to send the jury back and do anything more damaging to us. Whether this was correct or in error in hindsight I can't say."
Trial counsel was correct in his assertion that an unrecorded jury verdict, though announced, is of no force and is *428 alterable or amendable. Commonwealth v. Johnson, 359 Pa. 287, 59 A.2d 128 (1948); Commonwealth v. Dzvonick, 450 Pa. 98, 297 A.2d 912 (1972). Thus, had counsel objected, the Court could have ordered the jury to redeliberate on all possible counts of homicide. Although counsel could have asked that the jury be ordered to redeliberate on only murder of the third degree and voluntary manslaughter, the following passage is particularly instructive.
"The test is not whether other alternatives were more reasonable, employing a hindsight evaluation of the record. Although weigh the alternatives we must, the balance tips in favor of a finding of effective assistance as soon as it is determined that trial counsel's decisions had any reasonable basis." Commonwealth ex rel. Washington v. Maroney, 427 Pa. 599, 604-05, 235 A.2d 349 (1967) (Emphasis in original) (Footnote omitted).
Since trial counsel had a reasonable basis for not objecting, appellant was not denied the effective assistance of counsel.
Order affirmed.
NIX, J., concurs in the result.
ROBERTS, J., files a dissenting opinion.
ROBERTS, Justice, dissenting.
I dissent. After the foreman of the jury had announced the jury's verdicts to the court, the clerk of the court recorded the verdicts and announced them as follows:
"Members of the jury, hearken to the verdict as the Court hath it recorded. You do say, in the issue joined between the Commonwealth of Pennsylvania and Richard P. Brightwell, that you find him on Indictment No. 388, murder, not guilty first degree; guilty third degree; guilty on Indictment No. 389, voluntary manslaughter; guilty on Indictment No. 391, resisting arrest, and guilty on Indictment No. 394, possession of firearms without license, and so say you all?"
The jury, both as a whole and individually when polled, then affirmed its verdicts.
*429 As the majority notes, the verdicts of guilty of third degree murder and guilty of voluntary manslaughter are inconsistent. These verdicts, however, clearly are in no way inconsistent with the verdict of not guilty of murder of the first degree. Thus, had the court sent the jury back with additional instructions for further deliberation, it could not have permissibly directed the jury to reconsider its verdict of not guilty of first degree murder. See State v. Rhinehart, 267 N.C. 470, 148 S.E.2d 651 (1966) (where jury returned verdict of acquittal on one count and no verdict on another, reversible error to instruct jury to reconsider acquittal verdict while reaching verdict on other count).
The cases cited by the majority, Commonwealth v. Johnson, 359 Pa. 287, 59 A.2d 128 (1948) and Commonwealth v. Dzvonick, 450 Pa. 98, 297 A.2d 912 (1972), require this result and do not support the majority's contrary conclusion. These cases stand for the proposition that the jury, before discharge, may correct its verdict only if the verdict, on its face, shows an error in form or in substance. Here, the only verdicts which on their face show an error are the inconsistent verdicts of third degree murder and voluntary manslaughter. Because only these verdicts could have been reconsidered, counsel was ineffective for not requesting the court to instruct the jury to redeliberate only with respect to these inconsistent verdicts.
Further, even accepting the majority's erroneous premise that the jury could have validly reconsidered its verdict of acquittal of murder of the first degree, the majority's conclusion that counsel was effective despite his failure to request a limiting jury instruction is manifestly erroneous. Counsel advanced no interest of appellant by failing to request that the jury be directed to reconsider only its inconsistent verdicts of third degree murder and voluntary manslaughter. See Commonwealth ex rel. Washington v. Maroney, 427 Pa. 599, 235 A.2d 349 (1967). Even if the court had refused the request, counsel would have preserved his meritorious objection for direct appellate review. And, of course, if the court had complied with counsel's request, on *430 redeliberation appellant could have been found guilty of no more than murder of the third degree, and possibly would have been found guilty of voluntary manslaughter or acquitted. In short, there was something to gain and nothing to lose by requesting the court to limit the scope of the jury's redeliberations.
Because counsel was clearly ineffective for not requesting that the jury be permitted to reconsider only its inconsistent verdicts, the order of the PCHA court should be reversed, the judgment of sentence vacated, and a new trial granted on the charges of murder of the third degree and voluntary manslaughter. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534078/ | 176 N.J. Super. 511 (1980)
424 A.2d 222
IN THE MATTER OF THE COMMITMENT OF ROBERT LEE NEWSOME, APPELLANT.
Superior Court of New Jersey, Appellate Division.
Submitted October 7, 1980.
Decided October 31, 1980.
*513 Before Judges FRITZ, POLOW and JOELSON.
Stanley C. Van Ness, Public Advocate, attorney for appellant (Michael L. Perlin, Director, Division of Mental Health Advocacy; Edgar Devine, Assistant Deputy Public Advocate, of counsel and on the brief).
John J. Degnan, Attorney General, attorney for the State (Donald S. Coburn, Essex County Prosecutor, of counsel; Margaret Ann F. Mullins, Assistant Essex County Prosecutor, on the letter brief).
The opinion of the court was delivered by POLOW, J.A.D.
On December 31, 1979, following a commitment review hearing[1] pursuant to State v. Fields, 77 N.J. 282 (1978) the trial judge ordered that defendant "remain committed to the civil section of Trenton Psychiatric Hospital." Defendant's application for a new trial was denied on January 30, 1980 for the following reasons:
1. That Robert Lee Newsome continues to suffer from psychosis and organic brain damage;
*514 2. That he constitutes a danger to himself and to society; and
3. That the interests of society, as well as the interests of the defendant can best be served by in-patient supervision at the Trenton Psychiatric Hospital (civil section).
We are thus called upon to determine whether the broad discretionary authority of the trial judge was mistakenly exercised in ordering continued commitment of appellant who had been previously acquitted of criminal charges by reason of insanity. Recognizing the extremely narrow scope of appellate review and according the trial judge's determination the utmost deference, we nevertheless conclude that the record fails to supply a legitimate justification for continuance of prevailing restraints on the liberty of committee-appellant. Hence, we reverse and remand for further proceedings as indicated below.
When he was approximately 19 years of age, in May 1975, appellant Robert Lee Newsome, was the victim of a brutal mugging whereby he sustained severe head injuries. He was ultimately transferred from East Orange General Hospital to the Essex County Hospital Center and diagnosed as suffering from diffuse encephalopathy. In January 1976 he was discharged to his mother's care. In June 1977 he was indicted for carnal abuse and impairing the morals of a minor. It is conceded that he engaged in a voluntary and consensual sexual relationship with his 12 year old "girlfriend."
At a competency hearing, the court found that appellant suffered marked intellectual impairment and memory deficiency for recent and remote events. In addition, Newsome had a history of psychotic symptoms and suffered from chronic brain syndrome with psychosis and mental retardation. The trial judge concluded that defendant was unable to appreciate that his sexual behavior with a 12 year old child was wrong. Hence, appellant was acquitted by reason of insanity and transferred from the Essex County Jail to the Essex County Hospital Center, a psychiatric facility.
*515 Krol[2] hearings were conducted periodically and as of May 1, 1978, an order was entered for appellant's conditional discharge from the Essex County Hospital Center to an out-patient residential treatment program known as Project Right-On, operated by the Mount Carmel Guild in Newark. Although he eventually left the program in violation of the court's order, he did return on occasion to collect his mail and "see how things are going." He lived with members of his family and there is no evidence of any incident or problems involving appellant during the several months following his leaving the Right-On project until he was committed to Trenton Psychiatric Hospital on execution of a bench warrant issued by the court in November 1979.
At a hearing on December 20, 1979 two psychiatrists offered their opinions that Newsome was not dangerous to himself or others. Both concluded that there was no need for continued hospitalization although appellant continued to suffer from chronic organic brain syndrome and functioned at a mildly retarded level. He required medication to control a convulsive disorder resulting from his head injuries.
Both doctors were of the opinion that his mother could provide the committee with suitable structure and supervision, especially that necessary to insure his receiving regular medication.
Although counsel for the State agreed with the applicant that continued hospitalization was no longer necessary, by order of December 31, 1979 the court directed continued commitment to the civil section of Trenton Psychiatric Hospital. On this appeal, the State concedes that "in light of all of the information presently available with respect to appellant's condition, his continuing in-patient status is no longer required."
*516 After the United States Supreme Court announced that the standard of involuntary commitment must "bear some reasonable relation to the purpose for which the individual is committed," Jackson v. Indiana, 406 U.S. 715, 738, 92 S.Ct. 1845, 1858, 32 L.Ed.2d 435 (1972), the New Jersey statutory provision, N.J.S.A. 2A:163-3, was held unconstitutional because it permitted continued commitment of individuals suffering from slight mental illness. State v. Krol, 68 N.J. 236, 246-247 (1975). Nevertheless, the ultimate issue of "dangerousness," although it involves medical considerations, is a legal question for decision by the judge.
[W]hile courts in determining dangerousness should take full advantage of expert testimony presented by the State and by defendant, the decision is not one that can be left wholly to the technical expertise of the psychiatrists and psychologists. The determination of dangerousness involves a delicate balancing of society's interest in protection from harmful conduct against the individual's interest in personal liberty and autonomy. [Id. at 261]
Once the degrees of mental illness and "dangerousness" are determined, the judge is required to formulate an appropriate order providing for the least restrictive restraints found to be consistent with the safety of the community and the individual.
The object of the order is to impose that degree of restraint upon defendant necessary to reduce the risk of danger which he poses to an acceptable level. Doubts must be resolved in favor of protecting the public, but the court should not, by its order, infringe upon defendant's liberty or autonomy any more than appears reasonably necessary to accomplish this goal. [Id. at 261-262]
Such an order is subject to modification if the defendant has become more or less dangerous than he was previously, or it may be terminated upon a determination that the defendant is no longer mentally ill or dangerous at all. Id. at 263.
The Krol standards were further refined in Fields. The Fields court determined that a defendant acquitted by reason of insanity has the same right to periodic review as a civil committee. Fields, supra, 77 N.J. at 294. It was further noted that the burden of proof is imposed upon the State of justify continued restrictions. Id. at 299-300.
*517 The burden should not be placed on the civilly committed patient to justify his right to liberty. Freedom from involuntary confinement for those who have committed no crime is the natural state of individuals in this country. The burden must be placed on the state to prove the necessity of stripping the citizen of one of his most fundamental rights, and the risk of error must rest on the state. Since the state has no greater right to confine a patient after the validity of the original commitment has expired than it does to commit him in the first place, the state must bear the burden of proving the necessity of recommitment, just as it bears the burden of proving the necessity for commitment. [Id. at 300, citing Fasulo v. Arafeh, 173 Conn. 473, 378 A.2d 553, 557 (Sup.Ct. 1977).]
A recent United States Supreme Court decision has increased the burden imposed upon the state. In Addington v. Texas, 441 U.S. 418, 99 S.Ct. 1804, 60 L.Ed.2d 323 (1979) the court, in the context of a civil commitment proceeding, held,
To meet due process demands, the standard has to inform the factfinder that the proof must be greater than the preponderance of the evidence standard applicable to other categories of civil cases.
We noted earlier that the trial court employed the standard of `clear, unequivocal and convincing' evidence in appellant's commitment hearing before a jury. That instruction was constitutionally adequate. [Id. at 432-433, 99 S.Ct. at 1806].
More recently, we ordered a rehearing for application of the "clear and convincing evidence" standard rather than the "preponderance of the evidence" test previously applied. In re Scelfo, 170 N.J. Super. 394, 397 (App.Div. 1979).
The trial judge's conclusion that Newsome still constituted a danger to himself and to society and "that his behavior clearly indicated that he should not be released or the restraints in any way removed" was substantially based upon his concern about potential ill effects should appellant fail to take his medication regularly. There was no evidence that Newsome ever committed violent acts or demonstrated violent tendencies. His antisocial sexual behavior in 1977 involved no use of force. Although he was found at that time to be incapable of understanding "the age of consent" concept, there was evidence that he now understands it is wrong. Furthermore, during the four months residency with his family before the bench warrant was executed in November 1979, there is no evidence of misbehavior or offense of any kind on Newsome's part. There is no factual *518 support based upon past actions of the patient and no medical prognosis based upon his present condition to justify a finding of likelihood of dangerous conduct which either society or appellant must be guarded against. In re Matter of R.B., 158 N.J. Super. 542, 546 (App.Div. 1978). Hence, we must conclude that the trial judge's findings were so clearly erroneous "and so plainly unwarranted that the interests of justice demand intervention and correction." State v. Johnson, 42 N.J. 146, 162 (1964).
Although we must reverse, a further plenary hearing will be required. Hence, we cannot comply with the Public Advocate's request that we exercise original jurisdiction to establish conditions of release. The policy enunciated in State v. Maik, 60 N.J. 203, 218 (1972), that an offender is not "restored to reason" sufficient to justify release "unless he is so freed of the underlying illness that his `reason' can be expected to prevail," has been superseded by the concept of "conditional release."
The value of conditional release as a therapeutic measure is to be considered against the background of the Legislature's intent to provide `humane care and treatment.' Surely there is a point reached where a patient can no longer benefit from confinement in the artificial and protected environment afforded by a mental institution. Perhaps even more compelling is the harm which could occur to patients confined in institutions when contact with the outside world would stimulate them to recovery or prevent deterioration into more harmful states. [State v. Carter, 64 N.J. 382, 395 (1974) (footnote omitted)].
In formulating an appropriate order for conditional release, the trial judge must bear in mind the need for gradual relaxation of restraints.
It cannot be emphasized too strongly that the relaxation of the restraints on the committee's liberty must proceed in gradual stages. As the level of dangerousness posed by the committee decreases, he should be afforded the opportunity to demonstrate his ability to cope responsibly with the stresses of normal everyday life with diminishing degrees of supervision. Only after the committee has progressed to the point where he has proven that he can function in normal society with minimal supervision should consideration be given to unconditional release. This process of gradual de-escalation will substantially minimize the risk of erroneous determinations of non-dangerousness and will thus protect the State's compelling interest in maintaining the safety and security of its citizens. [State v. Fields, 77 N.J. at 303].
*519 We conclude, therefore, that the trial judge is in the best position to determine appropriate conditions, to obtain such additional information as may be necessary by way of testimony and medical reports, to determine what out-patient treatment may be required, to ascertain what facilities are available for such treatment and to impose appropriate requirements for supervision and review. A plenary hearing to establish release conditions shall be conducted within thirty days hereof.
Reversed and remanded.
FRITZ, P.J.A.D. (concurring).
In the circumstances of this case, I am satisfied of the correctness of the result achieved by the majority. My inability to join with certain of their determinations and my deep-seated concern for a potential problem in the area invoke this concurring opinion.
At the outset I record my unqualified agreement with the statement of the law in this area as it is articulately detailed by Judge Polow. I am certain, as well, that the trial judge was correctly informed in this respect and that he endeavored to apply that law to the facts. I concur in his comment in his oral opinion:
It is the burden of the State on a hearing such as this to, by a clear and convincing evidence, to demonstrate that the defendant remains a danger to himself and society. The determination of dangerousness involves the prediction of the defendant's future conduct rather than mere characterization of past conduct, although that is evidential as to probable future conduct. This determination, while requiring the Court to make use of the medical testimony furnished by both sides, in the final analysis the decision is a legal one and not a medical one. All doubts are to be resolved in favor of the public. Psychiatric opinion is no more conclusive on the dangerousness of a person who has been committed than his evidence manifested by actual potential harmful behavior. The final decision, as I said, is for the Court and not the psychiatrist.
I concur as well with my brethren that the record provides no support at all for the finding that "[t]he man is psychotic." The *520 evidence elicited from two testifying psychiatrists[1] seems wholly to the contrary. That he was previously psychotic seems undeniable. The record provides no evidence at all to suspect that condition prevails presently.
On the other hand, I cannot share the conviction of the majority that there "is no factual support based upon past actions of the patient and no medical prognosis based upon his present condition to justify a finding of likelihood of dangerous conduct which either society or appellant must be guarded against."
As far as past actions go, appellant departed without leave from a structured program which assured a medication regime both testifying doctors find vital to his well being and rational conduct. Without regard for the mentality here which, understandably perhaps, disregards orders of the court, I share the concern of the trial judge for the mentality here which does not realize (or understand) the absolute essentiality of the medication.
With respect to the prognosis, unlike the majority I also share the awareness of the trial judge that the favorable diagnoses and prognoses of both physicians were emphatically bottomed on the hypothesis that appellant would continue to take his medicine, a state of affairs which the treating psychiatrist, Dr. Remo, testified she suspected not to have prevailed while appellant was absent without leave. In his findings the trial judge emphasized his regard for the opinions of the doctors defining the necessity for continued medication and for the condition with respect thereto which they imposed on their favorable prognoses. He recognized that their belief that appellant was not presently a danger to himself or others was predicated on the fact that appellant was taking his medicine. These findings respecting *521 the expert opinions cannot be said to lack record support. When Dr. Remo was asked what might happen if appellant stopped taking his medication, she replied, "Well, I feel it might be there is a stress factor involved, he might be susceptible to it and react otherwise." The qualifications she imposed on her response to a question as to the circumstances which might cause appellant to become dangerous are even more telling:
Well, if circumstances prevail he was exposed to, for instance, any altercations, probably on the outside, and he's not taking any medication and he could be provoked by circumstances that prevails at the time, he could be susceptible in his emotion or impulses. He might not be able to control these, if he was not taking medication. However, if he would continue to take medication, perhaps his impulses could be controlled or tranquilizers it could be more amicably controlled, this behavior.
Candidly favoring discharge, Dr. Simring frankly stated that "[i]n terms of his medical condition, if he did not keep medical treatment ... I think he would be facing the problem of what to do once again."
The trial judge found therefrom (1) that appellant's condition of being not a danger to himself or others obtains "at this time" because he is compelled to take his medication by virtue of his hospitalization and (2) that his unauthorized departure from a court-ordered structured program and the experience thereafter at his mother's, both with regard to the medication and her lack of understanding of the situation, compelled a guarded forecast. I think these findings are not only reasonably supported by the record, but inescapable in the light of the expert testimony from both sides. In such circumstance we must not interfere, at least with respect to the findings. Rova Farms Resort v. Investors Ins. Co., 65 N.J. 474 (1974).
In my view it is extremely important, especially in this most sensitive field, that we do not permit hard facts to blind us to the wisdom (indeed, the mandate) of Rova, supra, and its predecessors in the field of deference to the trial judge, such as Dolson v. Anastasia, 55 N.J. 2, 7 (1969) and State v. Johnson, 42 N.J. 146 (1964). See also Mayflower Securities v. Bureau of Securities, 64 N.J. 85 (1973), DeAngelo v. Alsan Masons, Inc., 122 *522 N.J. Super. 88 (App.Div. 1973), aff'd o.b. 62 N.J. 581 (1973) and Parkview Village Asso. v. Bor. of Collingswood, 62 N.J. 21 (1972). Indeed, there is a direction that we should not undertake our own fact-finding jurisdiction (and presumably this also in the circumstance of declaring nonproof of facts; see Kaplowitz v. K & R Appliances, Inc., 108 N.J. Super. 54, 61-62 (App.Div. 1969), certif. den. 55 N.J. 452 (1970)) except "sparingly and in none but a clear case where there is no doubt about the matter." Greenfield v. Dusseault, 60 N.J. Super. 436, 444 (App.Div. 1960), aff'd o.b. majority opin., 33 N.J. 78 (1960).
This case is clearly one of hard facts. Apparently appellant is retarded through no fault of his own nor even as a matter of genetics: he suffered severe brain damage from a mugging. In such circumstance sexual activity with a consenting "girl friend" who also happened to be below the statutory age of consent does not take on the opprobrium of a rape or of the seduction of a child. The activity simply does not generate anger or inspire the revenge of punishment. Rather, almost irresistibly it invokes sympathy and a desire to help.
I respectfully suggest that it is this humanity and kindness, always commendable attributes, that mislead the majority. They find that there is no record evidence of likelihood of dangerous conduct which either society or appellant must be guarded against. They omit the condition necessary to invest that statement with accuracy: so long as defendant faithfully complies with a prescribed medication regimen.[2] It is this perfectly natural reaction (which I recognize because I had my *523 own struggle with it) which evokes that described above as my deep-seated concern for a potential problem.
Unless in these cases particularly, by the determined deference to the trial judge traditionally promised and accorded him, Dolson, supra, 55 N.J. at 7, we acknowledge his superior ability to latch on to a responsible "feel" for the case and to measure the demeanor of the witness, thereby not only assessing credibility but also measuring the innuendo of the testimony, we risk a dangerous, albeit perhaps unintentional, surrender of the function of the judiciary. No one here contests nor could anyone successfully contest that in New Jersey at least the determination respecting release is ultimately a legal one to be made not by doctors, or even the agreement of all counsel, but by the judge. This is not only his privilege but his obligation. State v. Krol, 68 N.J. 236, 261 (1975). Neither he nor we may delegate this function or abandon it. But unless on review we leave some room for play in the joints of the machine, we may well be turning over this decisional process to the medical profession or even to the executive branch. If the integrity of findings must rest on bases in literal expression derived from a printed transcript, we have told the State and the doctors that they may compel the result. I think such an effect offends both the letter and the spirit of our present law. As is specifically emphasized in Krol, supra, at 261,
... [W]hile courts ... should take full advantage of expert testimony presented by the State and by defendant, the decision is not one that can be left wholly to the technical expertise of the psychiatrists and psychologists. The determination of dangerousness involves a delicate balancing of society's interest in protection from harmful conduct against the individual's interest in personal liberty and autonomy.
Accordingly, I would defer to the findings of the judge and the entirely reasonable inferences he has drawn therefrom, except for that finding respecting appellant's psychotic nature. I am wholly satisfied he did not at all indulge in the "complete disregard of expert testimony absent any basis for disagreement" interdicted in State v. Carter, 64 N.J. 382, 406 (1974). Rather, he quite properly analyzed and evaluated the testimony.
*524 Irrespective of this, I am convinced that the ultimate determination of the trial judge was needlessly restrictive, even with an assumption of the findings made by him (less, of course, that concerning appellant's purportedly psychotic nature), and agree with the majority that to that extent he went wide of the mark. I am satisfied that a reasonably structured medication regimen would satisfy present needs. Therefore I join the majority in its intention to remand for the purposes set forth in the conclusion of its opinion.
NOTES
[1] The hearing was precipitated by the execution of a bench warrant issued when defendant violated conditions of a previous order. It was, nevertheless, dealt with by the court as a commitment review hearing.
[2] State v. Krol, 68 N.J. 236 (1975).
[1] Because neither the court nor counsel had "any problem" with the qualifications of Dr. Simring, they do not appear in this record. That his specialty is in psychiatry seems beyond question.
[2] I have intentionally not beclouded that which I think is a fairly clear measurement of the findings against the record by reference to such things as the fact that uncontroverted expert opinion in the case also spoke to the necessity for "follow-up care" including psychiatric treatment. Nor have I referred to the fact, possibly significant, that even when in the structured environment and medicating, appellant "never recognized his means to fit to the demands of the boarding home" and "would be a pest sometimes, a nuisance to the staff and to neighbors." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534079/ | 273 B.R. 313 (2002)
In re R. David BETZ Jean S. Betz, Debtors.
No. 01-43236.
United States Bankruptcy Court, D. Massachusetts.
February 15, 2002.
*314 *315 Richard S. Hackel, Boston, MA, for Debtors.
Stephen E. Shamban, Braintree, MA, for M. Selim Cetiner.
MEMORANDUM OF DECISION
HENRY J. BOROFF, Bankruptcy Judge.
Before the Court is a "Motion to Establish Value and Avoid Judicial Liens" ("Motion to Avoid Lien") filed by R. David Betz and Jean S. Betz (the "Debtors"), the debtors in this Chapter 7 case. M. Selim Cetiner ("Cetiner"), as conservator for Nevin Elibol, a creditor holding a judicial lien, has objected to allowance of the Motion (the "Objection"). The dispute arises out of the Debtors' claim to a homestead exemption in their primary residence located in Sudbury, Massachusetts (the "Residence"). Specifically, the parties dispute the amount of the exemption the Debtors may claim in the Residence pursuant to Mass. Gen. Laws Ann. Chap. 188, § 1 (1991 and Supp.2001) (hereinafter M.G.L.A. c. 188, § 1 or the "Homestead Statute"), as amended by the Statutes of 2000 Chap. 174, § 1 (the "Amendment").
The central issue in this case is whether the limitation set forth in § 3 of the Amendment, St.2000 c. 174, § 3 (hereinafter "Section 3"), which increases the dollar amount of the homestead from $100,000 to $300,000 but subordinates the increase to preexisting liens, is inconsistent with the Bankruptcy Code. Also in dispute in this case is whether Cetiner's response objecting to the Debtors' Motion to Avoid Lien satisfies the requirements of Fed. R. Bank. P. 4003(b) ("Rule 4003(b)"). That rule requires that an objection to a debtor's claimed exemptions be filed within 30 days of the conclusion of the § 341(a) meeting of creditors.
For the reasons outlined below, this Court holds that Cetiner's response to the Debtor's Motion satisfies the requirements of Rule 4003(b). This Court also holds that the reasoning of the First Circuit Court of Appeals in Patriot Portfolio v. Weinstein, 164 F.3d 677 (1st Cir.1999) extends to Section 3's subordination clause, and the exception to the increased homestead exemption for preexisting liens is thus preempted by § 522(c). Accordingly, the Debtors are entitled to claim an exemption in the Residence in the amount of $300,000 and employ that exemption for the purposes of § 522(f). This Court further holds that retroactive application of the increased exemption amount to Cetiner's lien presents no violation of his constitutionally protected property rights.
I. Facts and Position of the Parties
The Debtors filed for relief under Chapter 7 of the Bankruptcy Code on May 11, 2001. In their schedules, they claimed the state exemptions pursuant to § 522(b)(2). On May 29, 2001, the Debtors filed their Motion to Avoid Lien, claiming an exemption of $300,000 in the Residence. The meeting of creditors under 11 U.S.C. § 341(a) was held and concluded on June 25, 2001. Although Cetiner never filed an objection to the Debtors' claimed exemption as listed in their schedules, he filed a response objecting to the Debtor's Motion to Avoid Lien on June 25th. The deadline to file objections to the Debtors' claimed exemptions was July 24, 2001.
The Debtors assert that Cetiner's lien on the Residence is fully voidable on two grounds. First, the Debtors assert that, as a procedural matter, Cetiner is precluded from raising any objections to their claimed exemption because his failure to file a formal objection as mandated by Rule 4003(b) and Taylor v. Freeland & *316 Kronz, 503 U.S. 638, 112 S. Ct. 1644, 118 L. Ed. 2d 280 (1992), precludes him from doing so at this point. The Debtors claim that Rule 4003(b) requires that an independent, formal objection must be filed within the Rule's prescribed deadline.[1] The Debtors further claim that no such formal objection was filed within the deadline and that a response objecting to the Debtors' Motion to Avoid Liens does not satisfy the rule's requirements. As such, Cetiner can no longer raise any objections to the claimed amount of their homestead exemption.
Cetiner disagrees with the Debtors' interpretation of Rule 4003(b). Initially, Cetiner argues that the Objection in and of itself satisfies the requirements of Rule 4003(b). Because this response was filed well within the rule's deadline, he contends that he is not barred from objecting to the claimed $300,000 homestead exemption. Alternatively, he argues that if the Objection does not satisfy the definition of "objection" under Rule 4003(b), then he is still not precluded from challenging the Debtors' claimed exemption amount because his response to their Motion gave the Debtors timely notice of his objection.
The Debtors' second ground for voiding Cetiner's lien revolves around the interplay between §§ 522(b), (c) and (f) of the Bankruptcy Code. The Code allows a debtor to exempt certain property from the bankruptcy estate. If a state has not opted out of the federal scheme of exemptions, § 522(b) permits the debtor to choose between the federal exemptions outlined in § 522(d) and those exemptions provided under state or local law and other nonbankruptcy federal law. § 522(b)(1)-(2).[2] Massachusetts has not opted out of the federal scheme, so a debtor filing in this state has the option to choose between these two alternatives. Under § 522(c), the debtor's exempted property is then protected from liability for any pre-petition debts except those specifically outlined in § 522(c)(1)-(3).[3] § 522(c). Debts *317 which may encroach upon exempted property, as listed under § 522(c), include debts for certain taxes and custom duties, alimony and child support, and liens that are not void under § 522(f). Id. In turn, § 522(f) allows a debtor to avoid a lien on a debtor's property "to the extent that such lien impairs an exemption to which the debtor would have been entitled" under section § 522(b).[4] § 522(f)(1). Section 522(f)(2)(A) sets forth a formula to determine the extent to which a lien impairs an exemption to which the debtor would be entitled under subsection (b).[5]
The Homestead Statute allows a resident of Massachusetts to claim a homestead exemption upon the filing or recording of a homestead declaration, but with certain exceptions.[6] M.G.L.A. c. 188, §§ 1-2, 5. Chapter 174 of the Statutes of 2000 amended the Homestead Statute by increasing the amount of the homestead exemption from $100,000 to $300,000, effective November 2, 2000. St.2000 c. 174, § 1. Section 3 of the 2000 Amendment, however, subordinates the increased exemption to any "lien, right or interest" recorded or filed before the effective date of the Amendment. Section 3 states:
This act shall apply to declarations of homestead recorded or filed for registration pursuant to section 1 or 1A of chapter 188 of the General Laws before, on, or after the effective date of this act, but the increase in the amount of homestead protection for declarations recorded or filed for registration before the effective date of this act shall not have priority over, and shall be subordinate to, any lien, right or interest recorded or filed for registration before the effective date of this act.
Id., § 3.
Thus, the increase in the amount of the homestead exemption applies to all homestead declarations regardless of when they *318 were recorded, but to the extent that a lien arose after the date of the declaration of homestead but before the effective date of the statute, Section 3 mandates that the exemption be limited to the pre-amendment amount of $100,000. In effect, Section 3 carves out an exception to the homestead increase for preexisting liens or interests, much like the provisions in M.G.L.A. c. 188, §§ 1 and 5 which were invalidated by Weinstein.
The Debtors filed and recorded a declaration of homestead with the Massachusetts Land Registration Office on June 12, 2000. In the Motion to Avoid Lien, the Debtors claim that the value of their residence was $295,500 as of the date of case commencement.[7] The Residence was on that date encumbered by first and second mortgages in the amounts of $92,000 and $36,000, respectively, and by a non-avoidable real estate tax lien held by the Town of Sudbury in the amount of $4,741. Accordingly, as of the date of case commencement, non-avoidable encumbrances totaled $132,741. Cetiner holds a judicial lien in the amount of $500,000, issued by the Massachusetts Superior Court as pre-judgment security for a pending personal injury action filed by Cetiner against the Debtors. The writ of attachment was issued and recorded on June 14, 2000, two days after the Debtors filed their declaration of homestead but prior to the effective date of the Amendment.[8]
The continued viability of Cetiner's lien is dependent on the validity of Section 3's subordination clause in this case. Because the Debtors recorded their homestead declaration prior to the Amendment's effective date and because Cetiner's lien was also recorded prior to that date, the $100,000 amount applies unless the Bankruptcy Code preempts Section 3's exception for preexisting liens. If Section 3 is preempted, adding a $300,000 exemption to the other non-avoidable liens totaling $132,741 may invalidate Cetiner's judicial lien of $500,000 in its entirety, given the claimed value of the property.[9]
The Debtors assert that they are entitled to claim the $300,000 homestead exemption notwithstanding Section 3's clear language subordinating the increase to preexisting liens. They claim that the First Circuit's holding in Weinstein precludes application of Section 3's limitations in a bankruptcy case. Specifically, Weinstein held that § 522(c) prohibits application of state exemption exceptions that are not specifically listed in that subsection. Because § 522(c) does not list an exception for preexisting liens, the First Circuit held that the limitations contained in M.G.L.A. c. 188, §§ 1 and 5 were inapplicable in a bankruptcy case. The Debtors argue that this holding extends to the Amendment's *319 restriction on the increase in the amount of the homestead exemption.
Cetiner disagrees. He maintains that "as is its right, the Massachusetts state legislature has determined not only the types of property which may be claimed exempt, but also the amount of the claimed exemption." He further claims that "[i]t has been held in this District and in others that `bankruptcy courts defer to state law when determining the amount of the allowable state exemption.'" Although Cetiner concedes that under Weinstein the states are precluded from adding to the "categories" of debts listed in § 522(c), he maintains that the states are not prohibited from setting "the dollar amount of an exemption, or the conditions attendant to a change in the dollar amount of the claimed exemption." Under this rationale, bankruptcy courts must "first examine the state statute to determine the property which may be exempted and the amount which the Debtors may claim exempt," along with all of their built-in limitations. Accordingly, Cetiner concludes that the amount of the exemption as applicable to his specially protected lien is $100,000.[10] Therefore, even given the Debtors' valuation, his lien would only be partially voided.[11]
II. Discussion
A. Requirement of a Formal Objection Under Rule 4003(b)
As a threshold matter, the Court holds that Cetiner's failure to file a formal written objection to the Debtors' exemptions does not bar his present objection. Cetiner's response objecting to the Debtors' Motion to Avoid Lien was timely filed, giving the Debtors ample notice of Cetiner's objection to the claimed exemption amount.
Section 522(l) of the Bankruptcy Code provides that property claimed by a debtor as exempt will be deemed exempt if no timely objections are filed.[12] 11 U.S.C. § 522(l). Rule 4003(b) sets the time limit for filing objections to claimed exemptions. Upon the debtor's filing of schedules, an interested party must object to exemptions within 30 days after the meeting of creditors is concluded. Rule 4003(b). In Taylor v. Freeland & Kronz, 503 U.S. 638, 112 S. Ct. 1644, 118 L. Ed. 2d 280, the Supreme Court established the bright line rule that unless an objection is timely filed, an exemption *320 is valid even though it may have no legitimate basis. Taylor, 503 U.S. at 643-44, 112 S. Ct. 1644.[13] However, Taylor did not address the present question of what constitutes a sufficient "objection." Section 522(l) of the Code and Rule 4003(b) are also silent on this point. Applebee v. Brawn, 138 B.R. 327, 333 n. 29 (Bankr.D.Me.1992) (In re Brawn) ("The rules prescribe no form for objections to exemption claims.")
Nonetheless, the issue is well-settled. An overwhelming majority of courts have held that, at least in the instance where some form of written objection was manifested within the 30 day deadline, Rule 4003(b) is satisfied even though no formal objection was filed. See generally, Kenneth D. Ferguson, Repose or Not? Informal Objections to Claims of Exemptions After Taylor v. Freeland, 50 Okla. L.Rev. 45 (1997) (discussing differing rationales used by courts to conclude that failure to file a formal objection does not preclude objection to a § 522(f) or (h) claim). See also, In re Brawn, 138 B.R. at 333 n. 29 ("[R]esponse to § 522(f) motion qualifies, in and of itself, as the `objection' Rule 4003 requires."); Premier Capital, Inc. v. DeCarolis, 259 B.R. 467, 471 n. 8 (1st Cir. BAP 2001) (In re DeCarolis) (citing to In re Maylin, 155 B.R. 605, 613 (Bankr.D.Me.1993)) ("[E]ven if Taylor were applicable, `its rule does not foreclose a secured creditor from defending a § 522(f) or 522(h) action by denying that the property involved is exempt under applicable law.'"); Spenler v. Siegel, 212 B.R. 625, 630-31 (9th Cir. BAP 1997) (In re Spenler); In re Harry, 151 B.R. 735, 738 (Bankr.W.D.Va.1992) (objection in response to the debtor's motion to avoid lien constitutes sufficient objection under Rule 4003(b)); In re Young, 64 B.R. 611, 613 (E.D.La.1986) (trustee's motion to compel debtor's turnover of property was sufficient objection). But see, In re Snyder, 215 B.R. 477, 478 (Bankr.W.D.Okla.1997) (response to a motion to avoid lien does not constitute sufficient objection for purposes of Rule 4003(b)).
This Court will follow the majority view and holds that Cetiner's Objection, though not formally styled as an "objection to exemption," comprises a sufficient objection for purposes of Rule 4003(b). To hold otherwise would be to "elevate form over substance." In re Spenler, 212 B.R. at 630 (quoting Young v. Adler, 806 F.2d 1303, 1305 (5th Cir.1987)). Where, as here, the Debtors had full written notice of Cetiner's intent to object well within the deadline, the purposes of Rule 4003(b) are fully satisfied. As stated by the Spenler court, the Debtors cannot "complain that [they] did not have actual notice of [Cetiner's] objection," and accordingly, should not be allowed to "gain refuge behind Rule 4003(b)." Id.
B. Preemption of M.G.L.A. c. 174, § 3's Subordinating Clause
In Owen v. Owen, 500 U.S. 305, 111 S. Ct. 1833, 114 L. Ed. 2d 350 (1991), the Supreme Court set forth a three part test to determine § 522(f)' s applicability in avoiding a judicial lien. First, this Court must determine whether the debtor is entitled to an exemption. David Dorsey Dist. Inc., v. Sanders, 39 F.3d 258, 261 (10th Cir.1994) (citing to Owen v. Owen, 500 U.S. at 312-313, 111 S. Ct. 1833). Second, the Court must determine the extent to which *321 the lien may be avoided. Id. The third step is to determine whether the lien does, in fact, impair the exemption. Id. The issue in this case revolves around the first step. Although it is undisputed that the Debtors are entitled to claim a homestead exemption, the Court must determine the amount of the exemption to which they are entitled. The Court must make this determination in order to determine the extent to which Cetiner's lien may be avoided under § 522(f)(2)(A).
1. Analytical Framework
In order to determine the applicable amount of the Debtors' homestead exemption, the interplay between § 522(b), (c) and (f) of the Bankruptcy Code must be analyzed. As Judge Haines noted in In re Leicht, the analysis of these code sections presents a "circular conundrum." In re Leicht, 222 B.R. 670, 677 (1st Cir. BAP 1998). In this case, the Debtors chose the state exemptions under § 522(b)(2). That section tells us to look to the law that "is applicable on the date of the filing of the petition." The applicable law provides for a homestead exemption of $300,000 (instead of $100,000), unless a preexisting lien or interest is impaired. Weinstein holds that § 522(c) invalidates state law exceptions not specifically enumerated in § 522(c)(1)-(3). Section 522(c)(2)(A)(i) includes liens which cannot be avoided under subsection (f). In turn, because subsection (f)(1) directs us to look to what the debtor would be entitled to claim under subsection (b) to make this determination, we are back to square one.
The key to this puzzle lies in the interpretation of § 522(b) and its scope. That is, "[w]e must discern the outer limits of a state law's ability to control an exemption's operative characteristics in the bankruptcy universe." Id. A brief description of the history of subsection (b) is helpful to that understanding.
a. Background
Subsection (b) is the result of a compromise between two ideals of federalism. As noted by the Fifth Circuit in Davis v. Davis, 170 F.3d 475 (5th Cir.1999):
[e]xemptions are fought over by states'-rights advocates, who value the traditional state legislative prerogative to adjust exemptions to local economic conditions, and by advocates of federal uniformity, who want to raise- or lower exemptions based on conceptions of national equity. Congress allayed the controversy between state and federal advocates by providing in the 1978 Bankruptcy Code that states could opt out of prescribed federal exemptions altogether or could allow their citizens to select either schedule.
Davis v. Davis, 170 F.3d at 478. See generally, Matter of Sullivan, 680 F.2d 1131, 1133-34 (7th Cir.1982) (describing the divide between "true uniformity" and "geographic uniformity" in exemptions under the Bankruptcy Code); 9A Am.Jur.2d Bankruptcy § 1256 (1999) (same). The enactment of subsection (b), however, by no means settled this underlying dispute. The interpretation of the scope of this subsection, vis a vis the interplay of state defined exemptions under the Bankruptcy Code, is a subject of much disagreement. See In re Scott, 199 B.R. 586, 592-93 (Bankr.E.D.Va.1996) (discussing differing interpretations on the effect of the opt-out provision and cases cited therein). The circuits have divided along two lines.
Some courts have held that because Congress has delegated authority to the states to define exemptions under § 522(b), the states have full authority to supplement bankruptcy law with respect to exemptions. Under this view, a state is *322 free to expand or restrict exemptions regardless of whether they conflict with the Code. There is no preemption issue involved, according to these courts, because Congress has delegated full authority for the states to legislate in this area. See, e.g., Davis, 170 F.3d at 482 ("Congress allowed states to define the existence and limits of exemptions" so the state is free to "supplement bankruptcy law with respect to exemptions."); Granger v. Watson, 754 F.2d 1490, 1492 (9th Cir.1985) (stating that an opt-out state "has considerable freedom in creating exemptions and eligibility requirements for those exemptions."); Clark v. Chicago Mun. Credit Union, 119 F.3d 540, 544 (7th Cir.1997) ("Because Illinois has opted out of federal exemptions, the Illinois scheme of exemptions is allowed to be `quite inconsistent with the general goals of the federal Bankruptcy Code.'"); In re Duda, 182 B.R. 662, 670-71 (Bankr.D.Conn.1995) (holding that the debtor was not entitled to claim a homestead exemption because Connecticut law defined the homestead statute so as to preclude preexisting liens).
Other courts have held that the states may define "the nature and amount" of exemptions but cannot supplement the provisions of the Bankruptcy Code. See, e.g., In re Whalen-Griffin, 206 B.R. 277, 282 (Bankr.D.Mass.1997) (citing to In re Scott, 199 B.R. 586, 593 (Bankr.E.D.Va.1996)). Under this view, § 522(b) merely incorporates the state exemption list by reference. See, e.g., In re Bartlett, 168 B.R. 488, 494 (Bankr.D.N.H.1994) (stating that states "may [define] their own exemptions, but this is simply an incorporation by reference by Congress."). The states' ability to opt-out of the Code merely extends to the list of exemptions enumerated in § 522(d). In re Scott, 199 B.R. at 591 ("While it is clear that Congress in § 522(b)(1) intended to defer to the states in determining what property could be claimed exempt, Congress did not thereby permit the states to `opt out' of other exemption-related provisions of the Bankruptcy Code."); In re Thacker, 5 B.R. 592, 594 (Bankr.W.D.Va.1980) (stating that § 522(b)(1) opt out refers only to the federal exemptions under § 522(d), not § 522 entirely); In re Williams, 225 B.R. 759, 762 (Bankr.D.Nev.1998) ("Whether a lien `impairs' an exemption may be determined in every case by simply applying the formula set forth in § 522(f)(2) regardless of the limitations on the exemptions contemplated by state law."). Accordingly, insofar as a state law limiting exemptions conflicts with provisions in the Code, it is preempted and inapplicable in a bankruptcy case. In re Richardson, 224 B.R. 804, 808 (Bankr.N.D.Okla.1998) ("While federal law permits states to select the property that is exemptible, federal law exclusively governs the field of lien avoidance thereby preempting state law that limits the scope of its exemptions."). This is the view espoused by the First Circuit.
b. The Law in the First Circuit
In Weinstein, the First Circuit resolved a split within the District of Massachusetts on the question of whether the Bankruptcy Code preempts the Massachusetts homestead statute's exception for preexisting debts. The court held that M.G.L.A. c. 188, §§ 1 and 5 were preempted to the extent they allow "exempt property to be liable for debts other than those expressly enumerated in § 522(c)(1)-(3)." Weinstein, 164 F.3d at 683 (quoting In re Whalen-Griffin, 206 B.R. at 291-92). The court cited to Owen v. Owen, in which the Supreme Court stated that "[w]e have no basis for pronouncing [§ 522(b)'s] opt-out policy absolute, but must apply it along with whatever other competing or limiting policies the statute contains." Owen, 500 U.S. at 313, 111 S. Ct. 1833. Following the *323 Owen rationale, the First Circuit rejected an expansive reading of § 522(b). The court determined that:
. . . Congress afforded significant deference to state law by allowing bankruptcy debtors to choose state exemptions and by further allowing states to opt out of the federal exemption scheme entirely. Yet, such deference does not warrant the conclusion that the "property exempted" in section 522(c) must be defined by first applying all the built-in exceptions to the state exemption scheme.
Weinstein, 164 F.3d at 683. See also, In re Boucher, 203 B.R. 10, 12-13 (Bankr.D.Mass.1996) (stating that Congress "expressed no deference for debts protected by state law from the state's exemptions. . . . ").
In reaching this conclusion, the court cited to In re Whalen-Griffin and In re Leicht with approval. These two decisions rejected the theory espoused by this Court in In re Fracasso, 210 B.R. 221 (Bankr.D.Mass.1997) and In re Van Rye, 179 B.R. 375 (Bankr.D.Mass.1995). In Fracasso and Van Rye, this Court adopted a broad interpretation of the scope of § 522(b)'s opt-out provision. See In re Fracasso, 210 B.R. at 226 ("nothing in the legislative history [of § 522] suggests that the states are precluded from excepting certain debts in defining their exemptions."). In adopting the Whalen-Griffin and Leicht approach, the First Circuit rejected the theory that a court must first apply all of a state's limitations before making a determination of what property is exempt for purposes of §§ 522(b) and (c). Thus, Weinstein rejected the view that preexisting debts must be subtracted from the equity in the debtor's homestead estate before the determination of "exempt property" under § 522(b). Weinstein, 164 F.3d at 683.
In Leicht and Whalen-Griffin, Judge Haines and Judge Feeney, respectively, further defined the scope of § 522(b) and the operation of state exemptions under bankruptcy law as adopted by Weinstein. Leicht concluded that although Congress left it to the states to define the "category and content" of exemptions, it defined the "operative effect of exemptions in bankruptcy through §§ 522(c) and (f)." In re Leicht, 222 B.R. at 677. Accord, In re Bartlett, 168 B.R. at 498 ("[T]he effect of exemptions and the implementation of § 522(f)(1) avoidance powers will be determined in terms of the federal purposes involved notwithstanding the results that would otherwise be obtained if no bankruptcy had ensued.").
Thus, state defined exemptions are merely the backdrop upon which "federal principles operate to render results consistent with bankruptcy policy (results often contrary to state law)." In re Leicht, 222 B.R. at 680-81. Accord, Sanders, 39 F.3d at 260 ("Although bankruptcy courts defer to state law when determining the amount of the allowable state homestead exemption, section 522(f) still controls the availability of lien avoidance."); Tower Loan of Miss., Inc. v. Maddox, 15 F.3d 1347 (5th Cir.1994) ("States may not pass or enforce laws to interfere with or complement the Bankruptcy Code."); In re Richardson, 224 B.R. at 807 ("Impairment of an exemption is a concept embodied in § 522(f) of the Bankruptcy Code, and therefore its meaning is determined by analyzing the policies underlying bankruptcy law rather than state exemption law."); In re Conyers, 129 B.R. 470, 472 (Bankr.E.D.Ky.1991) ("The determination of the types of debts that remain collectible after bankruptcy from exempt property is controlled by federal rather than state law."). In practical application, this means that "states can determine the nature and *324 amount of property that can be exempted, but not the types of debts to which the exemption applies." Id. at 678; Whalen-Griffin, 206 B.R. at 282 (citing to In re Conyers, 129 B.R. at 472); In re Stewart, 246 B.R. 134, 139 (Bankr.D.N.H.2000) (same). This approach is commensurate with § 522(b)'s goal of balancing the state's interest in defining exemptions according to the needs and conditions of the locality, and the Code's "fresh-start" policy and uniformity. In re Leicht, 222 B.R. at 677. "[S]tate exemptions were retained when the Bankruptcy Code was enacted `so that exemption levels could be set at a level commensurate with the standard of living in various parts of the country.'" In re Scott, 199 B.R. at 592-93.
Weinstein, therefore, carves out two distinct and separate spheres within which federal and state laws operate under the Bankruptcy Code. Congress has delegated a limited subset of the federal sphere of power in allowing states to define the nature and amount of exemptions. Federal law trumps state law where it conflicts with policies of the federal law or where state law steps outside the delineated limits of the allotted subset of state law. This approach comports with the fact that "Congress has plenary power to enact uniform federal bankruptcy laws." Weinstein, 164 F.3d at 682-83.
2. The Amount of the Debtors' Homestead Exemption
Cetiner argues that the exception carved out by Section 3's subordinating provision falls under the permissive sphere of state law as delegated by Congress under § 522(b), and not under the exclusive sphere of federal bankruptcy law. No court in the District of Massachusetts has expressly addressed the question of whether Weinstein's holding preempting state law exclusions for preexisting debts extends to the state's ability to set exceptions for the amount of exemptions. Cetiner claims that it does not. He cites to language in Whalen-Griffin to support his argument that although states may not add to the type of debts enumerated in § 522(c), bankruptcy courts must uphold the limitations the state sets on the amount of exemptions.
In Whalen-Griffin, Judge Feeney noted that "[a]lthough a state can place limits on the dollar amount of a homestead exemption, the state cannot define the exemption with reference to obligations not identified in § 522(c)." In re Whalen-Griffin, 206 B.R. at 291-92 (emphasis added). Cetiner interprets this language to mean that unlike categories of debts for which exempt property may be liable under § 522(c), the determination of the amount of exemptions is wholly outside the sphere of federal law when the state exemption scheme is at play. According to Cetiner, this extends to the exceptions to the amount of the exemptions. Cetiner interprets "limits" in the above quoted language to include exceptions or restrictions, as opposed to merely a ceiling on the dollar amount of an exemption.
For purposes of §§ 522(c) and (f), this Court believes that Cetiner advocates a distinction without a difference. In light of the clearly established precedent in this Circuit, this Court believes that Cetiner has misinterpreted Judge Feeney's language in Whalen-Griffin. In application, Section 3's subordinating clause has the same effect as the other provisions of the Homestead Statute previously invalidated by the Weinstein holding. Whether the state excludes a category of debt from exemption protection altogether or whether it carves out an exception for the applicable dollar amount for the same category of debt is an irrelevant distinction given the overarching principle that conflicting *325 state exemption limitations have no effect under the Bankruptcy Code. Either method of carving out exceptions ultimately reduces the debtor's homestead estate because under either method, this Court must first apply the statute's exceptions before determining what property is exempt. Under the Bankruptcy Code, both methods must fail because § 522(b)(2) does not incorporate all of a state's built-in limitations on exemptions. Rather, the state exemption scheme is merely the platform upon which federal policies operate.
Accordingly, in determining what property is exempt under §§ 522(b)(2) and (c), this Court must look to the law in effect at the time of the bankruptcy filing notwithstanding the limitations set forth in the Homestead Statute. This is a principle that applies universally throughout § 522, irrespective of whether the exemption statute's exceptions apply to a category of debt as a whole or to the dollar amount of an exemption as applied to a particular category of debt.[14]
Giving effect to Section 3's limitation would be to contradict Weinstein's clear holding. Section 522(c) nowhere provides that preexisting debts or liens receive special protection under the Code. Accordingly, Section 3's subordinating clause conflicts with § 522(c) and has no effect in this bankruptcy proceeding. The applicable exemption amount in this case, therefore, is the amount in effect at the time the Debtors filed for relief, namely $300,000.
C. Retroactive Application of The Exemption Increase and the Fifth Amendment Takings Clause
Finally, Cetiner argues that a retroactive application of the exemption increase constitutes a taking of property under the Fifth Amendment of the Constitution. Following the reasoning of Weinstein, this Court holds otherwise.
Indeed, courts are divided on the question of whether increases in the amount of homestead exemptions must be applied prospectively in order to comport with the constitutional mandate of the Fifth Amendment.[15] However, this Court believes *326 that the relevant question is not whether the exemptions under state law have changed since the date that the lien arose (particularly since those exemptions are circumscribed in any event by the limitations of § 522(c)), but whether the avoidance provisions of the Bankruptcy Code, i.e., § 522(f), changed after that date and is sought to be applied retroactively. Weinstein focused not on the underlying exemption, but on § 522(f). The First Circuit held that because the creditor's lien in that case arose after § 522(f)'s enactment in 1979, there was no retroactive application of a lien avoidance provision. Id.; Leicht, 222 B.R. at 682. Noting that in United States v. Security Industrial Bank, 459 U.S. 70, 74-82, 103 S. Ct. 407, 74 L. Ed. 2d 235 (1982), the Supreme Court strongly suggested that prospective application of § 522(f)'s lien avoidance provision did not constitute a taking, the First Circuit concluded that avoidance of the creditor's lien in that case did not violate the Fifth Amendment. Id. at 685; Leicht at 682-83 ("[W]e take Security Inds. Bank's teaching as a strong signal, though short of an express holding, that prospective application of § 522(f)'s lien avoidance provisions does not offend the Fifth Amendment.").
As in Leicht and Weinstein, Cetiner's lien also arose after § 522(f)' s effective date. Cetiner's lien attached on June 14, 2000, twenty-one years after § 522(f)'s passage. The effect of lien avoidance in this case was prospective, not retroactive. When Cetiner's lien arose, he knew or should have known that, in the event of the Debtors' bankruptcy, § 522(f) might impact upon his lien and that the underlying state court exemptions might be adjusted depending upon the date of the filing of the bankruptcy case. As noted by other courts, it is reasonable to expect exemption rights to be periodically adjusted to reflect current economic conditions. In re Larson, 260 B.R. at 199. See also, In re Bartlett, 168 B.R. at 496 ("Property right [s] attaching to a creditor is subject to the vagaries of the economy which while it might provide increasing property value of the collateral in question likewise predictably would produce legislative response to adjust the homestead exemption amount to correspond with such increased property values."); In re Punke, 68 B.R. at 943 (stating that the effect of an increase in the exemption amount stems from the state legislature's attempt to align exemptions with modern economic reality); In re Johnson, 69 B.R. at 993 (same). This result "is not unjust, as every debt is contracted with reference to the rights of the parties thereto under existing exemption laws, and no creditor can reasonably complain if he gets his full share of all that the law, for the time being, places at the disposal of creditors." Leicht, 222 B.R. at 683-84 (quoting Hanover Nat'l Bank. v. Moyses, 186 U.S. 181, 189, 22 S. Ct. 857, 46 L. Ed. 1113 (1902)). Accordingly, Cetiner's property rights under the Fifth Amendment *327 are not infringed upon by application of the increased homestead amount.
III. Conclusion
For the foregoing reasons, the Court concludes that the applicable amount of the Debtors' homestead exemption, for the purpose of applying § 522(f) is $300,000. The Court will schedule such further hearings as may be necessary to determine the value of the Residence in order to determine the extent, if any, by which the Cetiner's lien should be avoided, employing the formula mandated by 522(f)(2)(A).
A separate order in conformity with this Memorandum of Decision shall enter in conjunction with this decision.
NOTES
[1] Fed. R. Bank. P. 4003(b) provides in relevant part:
A party in interest may file an objection to the list of property claimed as exempt only within 30 days after the meeting of creditors held under § 341(a) is concluded or within 30 days after any amendment to the list or supplemental schedules is filed, whichever is later. The court may, for cause, extend the time for filing objections if, before the time to object expires, a party in interest files a request for an extension.
[2] 11 U.S.C. § 522(b) provides in relevant part:
Notwithstanding section 541 of this title, an individual debtor may exempt from property of the estate the property listed in either paragraph (1) or, in the alternative, paragraph (2) of this subsection . . .
(1) property that is specified under subsection (d) of this section, unless the State law that is applicable to the debtor under paragraph (2)(A) of this subsection specifically does not so authorize, or in the alternative, (2)(A) any property that is exempt under Federal law, other than subsection (d) of this section, or State or local law that is applicable on the date of the filing of the petition at the place in which the debtor's domicile has been located for the 180 days immediately preceding the date of the filing of the petition . . .
[3] § 522(c) provides:
Unless the case is dismissed, property exempted under this section is not liable during or after the case for any debt of the debtor that arose, or that is determined under section 502 of this title as if such debt had arisen, before the commencement of the case, except
(1) a debt of a kind specified in section 523(a)(1) or 523(a)(5) of this title;
(2) a debt secured by a lien that is
(A)(1) not voided under subsection (f) or (g) of this section . . . and
(B) a tax lien, notice of which is properly filed.
(3) a debt of a kind specified in section 523(a)(4) or 523(a)(6) of this title owed by an institution-affiliated party of an insured depository institution to a Federal depository institutions regulatory agency acting in its capacity as conservator, receiver, or liquidating agent for such institution.
[4] § 522(f)(1) states in relevant part:
Notwithstanding any waiver of exemptions . . . the debtor may avoid the fixing of a lien on an interest of the debtor in property to the extent that such lien impairs an exemption to which the debtor would have been entitled under subsection (b) of this section, if such lien is
(A) a judicial lien, other than a judicial lien that secures a debt
(i) to a spouse, former spouse, or child of the debtor, for alimony to, maintenance for, or support of such spouse or child . . . ;
(B) a nonpossessory, nopurchase-money security interest . . .
[5] 11 U.S.C. § 522(f)(2)(A) provides:
For the purposes of this subsection, a lien shall be considered to impair an exemption to the extent that the sum of
(i) the lien,
(ii) all other liens on the property; and
(iii) the amount of the exemption that the debtors could claim if there were no liens on the property exceeds the value of the exemption that the debtor's interest in the property would have in the absence of any liens.
[6] M.G.L.A. c. 188, § 1 as amended provides in relevant part:
An estate of homestead to the extent of $300,000 in the land and buildings may be acquired pursuant to this chapter by an owner or owners of a home or one or all who rightfully possess the premise by lease or otherwise and who occupy or intend to occupy said home as a principal residence. Said estate shall be exempt from the laws of conveyance, descent, devise, attachment, levy on execution and sale for payment of debts or legacies except in the following cases:
(2) for a debt contracted prior to the acquisition of said estate of homestead.
In addition, M.G.L.A. c. 188, § 5 provides:
No estate of homestead shall affect a mortgage, lien or other encumbrance previously existing.
[7] Cetiner has not stipulated to that claimed value.
[8] This case differs from the facts of Weinstein where the judicial lien was recorded prior to the filing of a homestead declaration. See Weinstein, 164 F.3d at 679. Weinstein's substantive holding, however, applies to the instant case, as set forth below.
[9] The Debtors maintain that the § 522(f)(2)(A) formula should be applied as follows:
Cetiner's judicial lien $500,000
All other liens $132,741
Amount of Exemption $300,000
________
$932,741
Exceeds the value of the debtors' - $295,500
________
interest in the property by: $637,241
(Leaving no value for the lien) ($500,000-$637,241)
[10] Cetiner does not deny that the Debtors are entitled to claim the $300,000 homestead exemption as to all other creditors and the Chapter 7 Trustee. He claims that the $100,000 exemption applies specially to him due to his judicial lienor status as outlined in Section 3.
[11] Cetiner calculates the extent of the impairment of the Debtors' homestead exemption under § 522(f)(2)(A) as follows:
Cetiner's judicial lien $500,000
All other liens $132,741
Amount of Exemption $100,000
________
$732,741
Exceeds the value of the debtors' - $295,500
________
interest in the property would have by: $437,241
(Leaving a judicial lien of $62,759) ($500,000-$437,241)
[12] 11 U.S.C. § 522(l) provides in relevant part:
The debtor shall file a list of property that the debtor claims as exempt under subsection (b) of this section.... Unless a party in interest objects, the property claimed as exempt on such list is exempt.
[13] Although note that the bright line was somewhat befogged by the Court's inability to determine the impact, if any, of an argument made under 11 U.S.C. 105(a). Id. at 645, 112 S. Ct. 1644. See also Mercer v. Monzack, 53 F.3d 1 (1st Cir.1995).
[14] In reaching this conclusion, the Court is mindful of case law in other circuits that have held that state exemption statutes that preclude application of an increase in the dollar amount of the exemption to preexisting debts must be given effect under § 522(b)(2). In First National Bank of Mobile v. Norris, 701 F.2d 902 (11th Cir.1983), for instance, the Eleventh Circuit upheld the Alabama homestead statute's limit on the application of an increase in the amount of the exemption, stating that "[n]othing in [§ 522] suggests that the state cannot determine exemptions according to the date debts were incurred, i.e., allow different amounts for the exemption fixed by the date of debts." Norris, 701 F.2d at 905. See also, In re Eipp, 66 B.R. 1, 2 (Bankr.N.D.N.Y.1984) (holding that the New York homestead statute increasing the amount of the exemption but excepting the increase to debts contracted prior to the effect of the amendment applies in a bankruptcy proceeding); In re Puff `N Stuff of Winter Park, Inc., 183 B.R. 959, 962 (Bankr.M.D.Fla.1995) ("[E]quity suggests that debtors who incurred debts prior to [the exemption increase] should be bound by the exemptions in place at that time."); In re Murillo, 4 B.R. 612, 614 (Bankr.C.D.Cal.1980) (same). We are bound, however, by Weinstein's clear holding.
[15] See, e.g., In re Bartlett, 168 B.R. at 499 (upholding application of the higher exemption amount and reasoning that the legitimate public purpose of providing a debtor with a fresh start did not substantially impair the parties' contractual relationship); In re Larson, 260 B.R. 174, 202-03 (Bankr.D.Colo.2001) (noting circuit split on the issue and holding that retroactive application of increase in the amount of Colorado's homestead statute constitutes a "mere consequential incidence of a valid state regulation rather than rising to the level of a taking requiring just compensation."); In re Punke, 68 B.R. 936 (Bankr.N.D.Iowa 1987) (holding that retroactive application of the increase in the amount of the homestead exemption is the product of a "public program adjusting the benefits and burdens of economic life to promote the common good" and therefore no taking is involved); In re Johnson, 69 B.R. 988, 993 (Bankr.D.Minn.1987) (same). But see, In re Mayer, 156 B.R. 54, 59 (Bankr.S.D.Cal.1993) (holding that a creditor's judicial lien creates a vested right which cannot be impaired through retroactive application of an increase in the amount of a statutory exemption); In re Fossum, 59 B.R. 820, 823 (Bankr.D.Minn.1986) (holding that Minnesota statutory amendment increasing the value of exemptions for tools of trade must be applied prospectively only so as to avoid violation of the contracts clause); Bassin v. Stopher, 637 F.2d 668, 670 (9th Cir.1980) (holding that the amount in effect at the time debts arise must be applied in order to avoid unconstitutional impairment of a creditor's contract rights). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534106/ | 991 S.W.2d 484 (1999)
ALL AMERICAN BUILDERS, INC., Appellant,
v.
ALL AMERICAN SIDING OF DALLAS, INC., d/b/a All American Products, Appellee.
No. 2-98-198-CV.
Court of Appeals of Texas, Fort Worth.
May 6, 1999.
*486 Paxton Beal & McGahey, L.L.P., Orsen E. Paxton, III, and Jeff S. Knotts, Arlington, for Appellant.
Arch M. Skelton, PC, Arch M. Skelton, Dallas, for Appellee.
Panel A: CAYCE, C.J.; LIVINGSTON and BRIGHAM, JJ.
OPINION
WILLIAM BRIGHAM, Justice.
This is an appeal from the trial court's denial of permanent injunctive relief in a trademark infringement action. Both parties are competitors in the home remodeling industry; they install exterior siding. Appellant began operating under the name "All American Builders" prior to Appellee's use of the names "All American Products" and "All American Siding of Dallas, Inc." Appellant claimed trademark violation and sought permanent injunctive relief requiring Appellee to stop using the term "All American" in connection with the siding business. The trial court denied Appellant's request for permanent relief. Because we find no abuse of discretion, we affirm.
BACKGROUND
Appellant began doing business in 1988 as All American Builders, and incorporated as All American Builders, Inc. (AA-Builders) the following year. In 1990, Appellee began selling and installing storm windows and siding under the name All American Products. In 1995, Appellee incorporated as All American Siding of Dallas, Inc. (AA-Siding) and ceased using the name All American Products. In 1996, AA-Builders' owner, Milton Nelson, heard a radio advertisement for AA-Siding. Because of the similarity in names and the fact that consumers routinely referred to AA-Builders by that name, Nelson applied for and received a Certificate of Trademark or Service Mark Registration for All American Builders, Inc. from the secretary of state. In that registration, AA-Builders stated that the name "All American Builders, Inc." was to be used in connection with "[e]xterior remodeling services for single-story buildings and their surroundings, and especially the application of siding... and related accessories to singlefamily residences," and that "no other person to the best of [applicant's] knowledge... has the right in this state to use such mark either in the identical form thereof, *487 or in such near resemblance to cause confusion, or to cause mistake or to deceive."[1]
After registering its mark,[2] AA-Builders requested that AA-Siding stop using the term "All American" in connection with the siding business, but AA-Siding refused. Consequently, AA-Builders brought both common law and statutory claims seeking a statewide permanent injunction restricting AA-Siding's use of "All American Products" or "All American Siding" in connection with exterior siding.
In a trial to the court, AA-Builders presented witnesses and other evidence to prove its case. While AA-Siding crossexamined witnesses, its only other evidence consisted of exhibits from four area telephone directories showing that the term "All American" was commonly used regarding a variety of services. The trial court denied AA-Builders' request for relief and this appeal followed. The record contains no written findings of fact or conclusions of law.
STANDARD OF REVIEW
On appeal from a judgment either denying or granting a permanent injunction, the standard of review is clear abuse of discretion. See 2300, Inc. v. City of Arlington, 888 S.W.2d 123, 126 (Tex. App.Fort Worth 1994, no writ). The question for the appellate court is whether the trial court acted without reference to any guiding rules and principles. See Downer v. Aquamarine Operators, Inc., 701 S.W.2d 238, 241-42 (Tex.1985), cert. denied, 476 U.S. 1159, 106 S. Ct. 2279, 90 L. Ed. 2d 721 (1986). Simply because the trial court decided a matter differently than the appellate court would under similar circumstances is not an abuse of discretion. See id. at 242.
In a single point, AA-Builders contends that "the trial court erred in issuing a judgment denying ... a permanent injunction... because such decision is against the great weight of evidence presented and is a clear abuse of discretion."[3] Legal and factual sufficiency challenges are not independent grounds for reversal, but are factors to be considered in assessing whether the court has abused its discretion. See Beaumont Bank v. Buller, 806 S.W.2d 223, 226 (Tex.1991). There is no abuse of discretion if the trial court bases its decision on conflicting evidence and some evidence supports the trial court's finding on an issue of fact. See Griffin Indus., Inc. v. Thirteenth Court of Appeals, 934 S.W.2d 349, 355 (Tex.1996); Roa v. Roa, 970 S.W.2d 163, 165 (Tex. App.Fort Worth 1998, no writ). Likewise, we may not find an abuse of discretion merely because we would have decided a factual matter differently than the trial court. See Roa, 970 S.W.2d at 165. However, it is an abuse of discretion when the record demonstrates that the findings of the trial court necessary to sustain its order are not supported by some evidence. See Operation Rescue v. Planned Parenthood, 975 S.W.2d 546, 560 n. 56 (Tex.1998).
In a trial to the court where no findings of fact or conclusions of law are filed, the trial court's judgment implies all findings of fact necessary to support it. *488 See Pharo v. Chambers County, 922 S.W.2d 945, 948 (Tex.1996). Where a reporter's record is filed, however, these implied findings are not conclusive, and an appellant may challenge them by raising sufficiency of the evidence points. See Roberson v. Robinson, 768 S.W.2d 280, 281 (Tex.1989). Where the implied findings of fact are supported by the evidence, it is our duty to uphold the judgment on any theory of law applicable to the case. See Worford v. Stamper, 801 S.W.2d 108, 109 (Tex.1990).
TRADEMARK INFRINGEMENT
Because AA-Builders invoked both statutory and common law grounds in seeking to enjoin AA-Siding's use of the names "All American Products" and "All American Siding," we will address each ground in turn, starting with the statutory action.
To obtain a statutory injunction for infringement, Appellant must prove that Appellee uses or reproduces a colorable imitation of a registered mark in connection with selling, offering for sale, or advertising goods or services when the use is likely to deceive or cause confusion or mistake as to the source or origin of the goods or services. See TEX. BUS. & COM.CODE ANN. § 16.26(a).
Kenneth Kirks, AA-Siding's owner, testified that AA-Siding was the only name his company had used since 1995. Because the evidence is undisputed that AA-Siding abandoned use of the name "All American Products," it is not necessary to determine whether the trial court erred in refusing a permanent injunction against AA-Siding's use of the name "All American Products" on statutory grounds.
We next address whether the trial court abused its discretion in refusing an injunction against AA-Siding's use of the name "All American Siding" on statutory grounds. Section 16.27 provides that "[n]o registration under this chapter adversely affects common law rights acquired prior to registration under this chapter." TEX. BUS. & COM.CODE ANN. § 16.27(a). Because both parties used the phrase "All American" to identify their respective businesses for several years prior to April 22, 1996, when AA-Builders received a mark for the name "All American Builders, Inc.," and the statute preserves any common law rights of the parties acquired prior to registration, this case is essentially governed by the common law. See id. Therefore, we must look to the common law to determine whether the trial court abused its discretion in refusing an injunction against AA-Siding's use of the name "All American Siding."
To succeed on a common law claim for trade name infringement, the party seeking an injunction must show: (1) the name it seeks to protect is eligible for protection; (2) it is the senior user of the name; (3) there is a likelihood of confusion between its mark and that of its competitor; and (4) the likelihood of confusion will cause irreparable injury for which there is no adequate legal remedy.[4]See Thompson v. Thompson Air Conditioning and Heating, Inc., 884 S.W.2d 555, 558 (Tex. App.Texarkana 1994, no writ); Zapata Corp. v. Zapata Trading Int'l, Inc., 841 S.W.2d 45, 47 (Tex.App.Houston [14th Dist.] 1992, no writ) (citing Union Nat'l Bank, Laredo v. Union Nat'l Bank, Austin, 909 F.2d 839, 844 (5th Cir.1990)). The issues in a common law trademark infringement action under Texas law are no different than those under federal trademark law. See Waples-Platter Cos., 439 F.Supp. at 583.
The threshold issue is whether the word or phrase is initially eligible for *489 protection. See Union Nat'l Bank, Laredo, 909 F.2d at 844. AA-Builders argues that because it was able to register "All American Builders, Inc.," and because in registering the mark, it disclaimed the terms "Builders" and "Inc." standing alone, such registration creates a rebuttable presumption that "All American" is eligible for protection. We disagree. Registration creates a rebuttable presumption that the party registering the mark is the owner thereof, and that the registration is valid and exclusive to the registrant.[5]See TEX. BUS. & COM.CODE ANN. § 16.15(c). Any advantage is only procedural. A rebuttable presumption shifts the burden of producing evidence to the party against whom it operates. See General Motors Corp. v. Saenz, 873 S.W.2d 353, 359 (Tex.1993). Once the burden is discharged and evidence contradicting the presumption has been offered, the presumption is extinguished and shall not be weighed or treated as evidence. See id. Furthermore, the presumption has no effect on the burden of persuasion. See id.
Nelson admitted on cross-examination that he knew before he registered for exclusive use protection that All American Siding of Dallas, Inc. existed and sold siding in the area. This is some evidence that AA-Builders did not have the exclusive right to use the mark at the time of registration. Also, AA-Siding introduced evidence consisting of pages from local telephone directories, showing that the phrase "All American" was used by a number of service and product providers. Examples include: "All American Industries," "All American Products," "All American Services," "All American Homes," and "All American Inspectors." This evidence was sufficient to contradict the presumption that AA-Builders' mark was protectable at the time it was registered. Therefore, AA-Builders' initial burden, not affected by any presumption, was to persuade the trial court that the term "All American" was eligible for protection.
Whether a word or phrase is eligible for protection is determined by the category to which it belongs: (1) generic; (2) descriptive; (3) suggestive; or (4) arbitrary. See Union Nat'l Bank, Laredo, 909 F.2d at 844. The importance of assigning a term to one of the four categories is to determine whether or not, or in what circumstances, the term is eligible for protection. See id. "Generic" terms are never eligible for protection. See id. "Descriptive" terms may only be protected after proof of secondary meaning, while "suggestive" and "arbitrary or fanciful" terms are all protectable without proof of secondary meaning. See id.; Zatarains, Inc. v. Oak Grove Smokehouse, Inc., 698 F.2d 786, 790-91 (5 th Cir.1983). Assigning a term to a specific category is a difficult and imprecise task. See, e.g., Zatarains, 698 F.2d at 790. The categorization of a term is properly considered a question of fact because the appropriate categorization is not self-evident. See Union Nat'l Bank, Laredo, 909 F.2d at 846.
The categories are well defined, sometimes overlapping, points on a continuum ranging from strong to weak. See id. at 845-46; Little Caesar Enters., Inc. v. Pizza Caesar, Inc., 834 F.2d 568, 571 (6 th Cir.1987). The strongest marks are "arbitrary or fanciful:" words or phrases that are either coined, such as "Xerox," or that are not suggestive of the product or service, such as "Ivory," as applied to soap. See Union Nat'l Bank, Laredo, 909 F.2d at 845. Next on the continuum are "suggestive" terms, or those that require the consumer to draw a conclusion or exercise *490 their imagination. These terms allude to rather than describe an attribute or characteristic of the good or service, such as "Igloo" in connection with an ice chest. See id. "Arbitrary or fanciful" and "suggestive" terms are given the greatest amount of protection because they are distinctive; they require no proof of secondary meaning. See id. at 844.
Moving on in ascending order of strength, next and last on the continuum are "descriptive" and "generic" terms. See id. at 844-45. "Descriptive" terms usually identify a characteristic or quality of the good or service. See id. at 845. Typically, these terms are adjectives, such as "speedy," "blue," or "reliable." See id. Geographical terms, such as "Texas" or "North Main" are also considered descriptive when they describe where the products or services are offered or manufactured. See id. "Descriptive" terms are eligible for protection only after proof that they have acquired a secondary meaning. See id. at 844.[6] "Generic" terms, the weakest marks, identify a class of things or services of which the item or service in dispute is simply a member. See id. at 845. For instance, the term "fruit" applies equally to apples, oranges, or grapes. "Generic" terms are not entitled to protection because the public interest would be disserved if a single competitor were allowed to prevent others from using a word that designates the good or service being offered. See id. at 844; Jellibeans, Inc. v. Skating Clubs of Georgia, Inc., 716 F.2d 833, 841 n. 19 (11th Cir.1983).
AA-Builders' sole argument as to the threshold issue is that because "All American Builders, Inc." was registered, it is eligible for protection. But in order to persuade the trier of fact, AA-Builders' burden was to show that the phrase "All American" is eligible for protection by putting on evidence that the phrase is distinctive and requires no further proof of secondary meaning. Appellant neither contends nor points to any evidence supportive of such a contention. Alternatively, AA-Builders had to prove that "All American" is "descriptive," with the additional heavy burden of showing that the primary significance of the phrase in the minds of the consumers is siding, and not AA-Builders. We find no such argument in its brief, and no evidence in the record of secondary meaning in the minds of siding consumers.
Because the trial court's denial of injunctive relief could have been based on grounds that AA-Builders did not meet its burden of showing that the phrase "All American" is eligible for protection, we hold there was no abuse of discretion. Accordingly, we overrule AA-Builders' sole point.
CONCLUSION
Having overruled AA-Builders' only point, we affirm judgment denying permanent injunctive relief.
NOTES
[1] Nelson knew at the time he filed for exclusive use protection that there was a corporation named All American Siding of Dallas, Inc. that was selling siding.
[2] "Mark" means a word, name, symbol, device, slogan, or any combination thereof that, whether registered or not, has been used to identify a product or service and distinguishes that product or service from others. "Trademark" applies to products and "service mark" applies to services. See TEX. BUS. & COM.CODE ANN. § 16.01 (Vernon 1987). Accordingly, service marks and trademarks are governed by identical standards. See Boston Prof'l Hockey Ass'n v. Dallas Cap & Emblem Mfg., Inc., 510 F.2d 1004, 1009 (5th Cir.), cert. denied, 423 U.S. 868, 96 S. Ct. 132, 46 L. Ed. 2d 98 (1975).
[3] A party may raise complaints about the factual sufficiency of the evidence in a nonjury trial for the first time on appeal. See TEX.R. CIV. P. 324(a)-(b) (Vernon Supp.1999); Regan v. Lee, 879 S.W.2d 133, 135 (Tex.App.Houston [14th Dist.] 1994, no writ).
[4] We disagree with AA-Siding that AA-Builders must also prove intent to defraud. In an action strictly based on trademark infringement, prior use of the trademark gives rise to a presumption of exclusive right of use; thus, it is unnecessary to prove an intent to defraud. See Waples-Platter Cos. v. General Foods Corp., 439 F. Supp. 551, 574 (N.D.Tex. 1977).
[5] A mark, valid and exclusive to the registrant, is nothing more than constructive notice in this state of the registrant's claim of ownership. See TEX. BUS. & COM.CODE ANN. § 16.15(b). Registered marks may be canceled upon a finding that the mark: (1) has been abandoned; (2) is not owned by the registrant; (3) was granted contrary to trademark law provisions; (4) was obtained fraudulently; or (5) has become incapable of serving as a mark. See id. § 16.16(4).
[6] In order to establish secondary meaning, the plaintiff must show that the primary significance of the term in the minds of the consuming public is not the product but the producer. See Kellogg Co. v. National Biscuit Co., 305 U.S. 111, 118, 59 S. Ct. 109, 113, 83 L. Ed. 73 (1938). A high degree of proof is necessary to establish secondary meaning for a descriptive term. See American Heritage Life Ins. Co. v. Heritage Life Ins. Co., 494 F.2d 3, 12 (5 th Circ.1974). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534126/ | 415 B.R. 832 (2009)
In re Cynthia J. NEVELS, aka Cynthia J. Elvrum, Debtor.
No. 13-07-11513 SA.
United States Bankruptcy Court, D. New Mexico.
October 9, 2009.
*833 William R. Brummett, Albuquerque, NM, Debtor.
MEMORANDUM OPINION ON ATTORNEY SCHUCHARDT'S OBJECTION TO CHAPTER 13 TRUSTEE'S FINAL ACCOUNT AND PETITION FOR FINAL DECREE
JAMES S. STARZYNSKI, Bankruptcy Judge.
This matter came before the Court on the Standing Chapter 13 Trustee's Final Account of Trustee and Petition for Final Decree (doc 74), and the Objection to Chapter 13 Trustee's Final Accounting ("Objection") (doc 75) filed by Elliott Schuchardt, the Debtor's former counsel (sometimes "Counsel"). For the reasons set forth below, the Court finds that the Objection is not well taken and should be overruled.[1]
Background
Debtor Cynthia Nevels filed a Chapter 13 petition and plan through Counsel on June 26, 2007. The Statement of Financial Affairs disclosed a $50,000 transfer to Debtor's son some four months before the bankruptcy to cover his college expenses. Ms. Nevel's largest creditor by far was her ex-husband Ronald Nevels, whose claim ultimately turned out to be a little under $50,000. Mr. Nevels was the only non-priority, non-administrative unsecured creditor to receive a distribution.
The plan called for monthly payments of $300 for 36 months. The confirmation order (doc 28)[2], entered March 4, 2008, ordered Debtor to make these payments and also provided for the turnover to the estate of the $50,000. Since the $50,000 had been deposited in a certificate of deposit with *834 New Mexico Educators Federal Credit Union and had been held pending entry of the confirmation order, those funds were delivered to the Trustee shortly after the entry of the confirmation order.
On February 21, 2008, Counsel withdrew from representing Debtor and attorney William R. Brummett substituted in, doc 27, although Counsel had signed off on the confirmation order. Following confirmation, Counsel filed an application for approval of attorney fees of $5,527.58 and costs of $297.23 (doc 38), which Debtor contested. Ultimately the Court granted the application in the full amount of $5,824.81, having found that Counsel represented Debtor well at a very reasonable cost. Doc 65. Taking into account Debtor's prepetition payment of $776 and the Trustee's initial (and only) post petition payment to Counsel of $1,524, Counsel is still owed $3,524.81.[3]
On August 19, 2008, the Trustee filed a Motion to Dismiss for failure to make plan payments in the amount of $1200, doc 68, which the Court granted on October 3, 2008. Doc 70. Trustee filed the Final Account of Trustee and Petition of [sic should be "for"?] Final Decree ("Final Account") on October 23, 2008, which drew Counsel's objection.
In the meantime, the events which led to this dispute occurred. Plan section III(b) discusses the treatment of Debtor's attorney's fees as an administrative claim:
Debtor's Attorney's Fees. The debtor's attorney's fees shall be paid as follows: (a) counsel for the debtor anticipates total attorney's fees in an amount of at least $2,300 including gross receipts tax, and not including the filing fee ("Pre-Application Fees"); (b) counsel for the debtor shall be permitted to apply a pre-petition retainer (the "Retainer") for fees and costs received by counsel in the amount of $776 (not including the filing fee) to the Pre-Application Fees; (c) upon confirmation, to the extent such funds exist and are available for this purpose, the trustee shall distribute the difference between the Pre-Application Fees and the Retainer to counsel for the debtor pending the filing and allowance of a fee application; (d) within fifteen (15) days after confirmation of the plan, counsel for the debtor shall file a fee application for all services rendered and costs incurred up to and including confirmation; (e) any fees requested in addition to the Pre-Application Fees shall only be paid by the trustee after approval by the Court; and (f) in the event that the fees approved by the Court are less than the Pre-Application Fees paid to counsel by the debtor, trustee or otherwise, then counsel for the debtor shall refund to the trustee the difference between the Pre-Application Fees and the amount awarded. If debtor's attorney fails to file its fee application within fifteen (15) days after entry of an order confirming this plan (or within such additional time as the Court may allow upon motion for extension filed within said time), counsel shall refund to the trustee the Pre-Application Fees and funds distributed by the trustee, and the trustee shall be entitled to an order requiring such turnover. Nothing herein shall preclude counsel from filing a fee application after the time allowed hereunder, and being paid pursuant to this paragraph upon entry of an order allowing such fees, but counsel's entitlement to payment at the time of the first distribution of funds from the trustee after confirmation of this plan shall depend *835 on the timely filing of the initial fee application.
The confirmation order repeated in decretal paragraph 3 the substance of the first sentence of the above-quoted plan provision.
The Final Report states that the case was dismissed after confirmation, and accounted for total receipts of $54,575.72, no administrative payments, a priority payment of $1,524.00[4], no secured payments, $49,231.42 unsecured payments, and $3,820.30 in Trustee fees, for total disbursements of $54,575.72. Counsel received from the estate only the $1,524.00 which, combined with the $776 that Counsel received from Debtor prepetition, totaled the $2,300 figure in the plan and confirmation order.
The deadline for filing the fee application was March 19, 2008. It got filed on April 22. On March 31, almost two weeks after the application was due, Counsel e-mailed the Trustee asking her for an extension of time because he would be out of the country until mid-April. However, Counsel did not, as some other counsel do, file a motion asking for an extension of time to file the application, which he could have done at any time before he left the country or indeed even before confirmation.
Counsel and Trustee agree that Counsel told Trustee on March 31 that the application was going to be filed, and they both agree that Trustee agreed that she would not seek disgorgement of any of his fees pursuant to the plan and confirmation order prior to April 30, 2008.[5] Counsel understood Trustee's commitment not to seek disgorgement until April 30 as an agreement, de facto or explicit, to allow him up to April 30 to file a fee application and to withhold distribution, or withhold sufficient funds from the distribution, until then. Trustee understood no such thing, but merely that she would not file a disgorgement motion against Counsel.
The standard chapter 13 procedure in this District is that upon the filing of a fee application, Trustee reserves from distribution sufficient funds to cover the maximum amount requested by the application (to the extent of the funds available), and holds the funds until a ruling on the fee application. Trustee then pays according to the court order on the next disbursement date. In this instance, Trustee made a small disbursement in late March (including the $1,524) and then disbursed the bulk of the funds on April 22, the same day the fee application was filed.[6] Thus, she did not have on file nor, as explained below, was she, practically speaking, on notice on that day (April 22) that she should reserve any amount for Counsel's fee application. And since as it turned out Debtor had made her last monthly payment to Trustee almost a month earlier, on March 28, there turned out to be no funds to be reserved for payment of Counsel's fees.
Analysis
Counsel objects to the Final Report 1) as violative of the "absolute priority rule" *836 [sic] of 11 U.S.C. § 507(a)(2); 2) as violative of the Trustee's fiduciary duties; 3) as violative of the rule that administrative expenses should be paid pro rata. He seeks to hold the Trustee personally responsible for the alleged mispayments, or alternatively to require her to seek disgorgement from the unsecured creditor who received the bulk of the distributions, and seeks punitive damages.
ABSOLUTE PRIORITY RULE
The "absolute priority rule" is a term of art in chapter 11 bankruptcies. It is of no relevance to Chapter 13 administrative expenses.
[T]he absolute priority rule "provides that a dissenting class of unsecured creditors must be provided for in full before any junior class can receive or retain any property [under a reorganization] plan." [Ahlers v. Norwest Bank Worthington] 794 F.2d [388], at 401 [(8th Cir.1986)]. The rule had its genesis in judicial construction of the undefined requirement of the early bankruptcy statute that reorganization plans be "fair and equitable." See Northern Pacific R. Co. v. Boyd, 228 U.S. 482, 504-505, 33 S. Ct. 554, 560, 57 L. Ed. 931 (1913); Louisville Trust Co. v. Louisville, N.A. & C.R. Co., 174 U.S. 674, 684, 19 S. Ct. 827, 830, 43 L. Ed. 1130 (1899). The rule has since gained express statutory force, and was incorporated into Chapter 11 of the Bankruptcy Code adopted in 1978. See 11 U.S.C. § 1129(b)(2)(B)(ii) (1982 ed., Supp. IV). Under current law, no Chapter 11 reorganization plan can be confirmed over the creditors' legitimate objections (absent certain conditions not relevant here) if it fails to comply with the absolute priority rule.
Norwest Bank Worthington v. Ahlers, 485 U.S. 197, 202, 108 S. Ct. 963, 99 L. Ed. 2d 169 (1988).
Counsel appears to argue that administrative expenses must be paid in full before lower priority (i.e., non-priority unsecured) claims may be paid. However, this is not the rule in Chapter 13. First, Section 1322(b)(4) states that a plan may provide for payments on any unsecured claim to be made concurrently with payments on any secured claim or any other unsecured claim. Administrative claims are unsecured, so this suggests that administrative claims can be paid at the same time as priority or secured claims. This concept is reinforced by Section 1326(b) which provides, in relevant part:
(b) Before or at the time of each payment to creditors under the plan, there shall be paid
(1) any unpaid claim of the kind specified in section 507(a)(2) of this title; [and]
(2) if a standing trustee appointed under section 586(b) of title 28 is serving in the case, the percentage fee fixed for such standing trustee under section 586(e)(1)(B) of title 28....
This section states that, at the time of each individual payment, the Trustee should first pay both 507(a)(2) claims (i.e., administrative expense claims allowed under § 503(b) including attorneys fees) and the standing trustee's commission. This suggests that if there are no unpaid 507(a)(2) claims at the time of an individual distribution, the Trustee, by statute, takes her fees and pays the balance of the funds according to the plan. There is no language that the Trustee is to reserve funds for future payment of unfiled 507(a)(2) expenses[7]. There is no requirement that all approved *837 507(a)(2) claims and all future but yet unapproved 507(a)(2) claims be paid in full before any payments to non-priority unsecured creditors could be made according to the plan. If this were the case, a trustee could only disburse after many if not all payments by the debtor were received and all administrative expenses were finally approved;[8] in other words, the trustee might be able to make only one payment: the last one. In short, there is no priority of payment rule in Chapter 13 of the sort that Counsel suggests. Compare 11 U.S.C. 726(a) (In Chapter 7 cases, trustee must distribute to Section 507 claims "in the order specified in section 507".) There is no parallel statute in Chapter 13. Alabama v. Brown (In re Brown), 2008 WL 205578 at *3 (M.D.Ala.2008). See also 3 Keith M. Lundin, Chapter 13 Bankruptcy § 204.2 n. 29 (3rd Ed.2007)("The order of distribution of property in 11 U.S.C. § 726(a) does not apply in a Chapter 13 case.")
TRUSTEE'S FIDUCIARY DUTIES
One reason for the deadline to file a fee application is to assure that the Trustee is on notice of what amounts are claimed and are authorized by the Court (through an order approving a fee application) to pay the fees. But the Court will not impose the duty on the Chapter 13 Trustee to ensure that fee applications are filed before distributions are made. The Code requires a trustee to distribute as soon as practicable. The plan explicitly spells out the consequences of not filing a fee application within a very short period of time: the debtor's attorney forfeits the right to share in the initial distributions. That is especially true in this case, where Debtor's attorney knew from the confirmation Order that a $50,000 certificate of deposit was likely to be distributed early in the case. Debtor's attorney cannot blame the Trustee for his own failure to file a timely fee application. Furthermore, the Trustee was expecting years more of payments from which the attorney fees could have been paid. The Trustee had no control over the fact that Debtor stopped making payments and was dismissed before the attorneys fees were paid.
PRO RATA ADMINISTRATIVE EXPENSES
Counsel argues that it is inequitable and a violation of the absolute priority rule [sic] that the Trustee has received all of her Chapter 13 commissions from the estate yet he has received none. As discussed above, there is no priority rule for payment of administrative expenses in a chapter 13 as there is in a chapter 7 case. It may be unfair that Mr. Schuchardt did not get paid, but it is purely a timing issue. Debtor elected to stop making payments before the attorneys fees were paid. "Given Chapter 13's voluntary nature, an unsecured creditor must accept the risk that a case will not be commenced in the first place or that it will never complete." In re Baines, 263 B.R. 868, 873 (Bankr.S.D.Ill. 2001).
Conclusion
The Trustee has done nothing wrong and is not liable to Mr. Schuchardt for any of his attorney fees.[9] Punitive damages are not appropriate. Explicitly, the Court *838 finds no basis whatever to conclude that Trustee was "gaming" the system, intending to cheat Counsel, or engaging in any unethical conduct in any manner, in this case or any other case.
The Trustee shall submit an Order approving the Trustee's Final Account and overruling Mr. Schuchardt's objection.
NOTES
[1] The Court has jurisdiction of the subject matter and of the persons herein pursuant to 28 U.S.C. §§ 1334 and 157(a); this is a core proceeding pursuant to 28 U.S.C. § 157(b)(2)(A); and these are findings of fact and conclusions of law as may be required by F.R.B.P. 7052. The Court is making this decision based on the presentations of the parties, a procedure agreed to by the parties at the hearing conducted by the Court on November 18, 2008.
[2] Due to the poor visual quality of the order that was entered, the Court subsequently "refiled" the text of the order so that it is readable. Doc 36.
[3] Counsel asserts that the amount he is still owed is $3,100.81. Objection, ¶ 12, at 3. Given the Court's approval of the Final Account, the difference is irrelevant.
[4] In fact, the $1,524.00 was the payment to Counsel, and therefore the Final Account is in error when it categorizes this payment as Priority rather than Administrative. The error is harmless.
[5] To be clear, the disgorgement discussed in the presentations to the Court referred only to potential disgorgement by Counsel of unapproved fees ($2,300). There was never any suggestion to the Court that Trustee agreed to pursue disgorgement from the single unsecured creditor or that the Trustee agreed to disgorge any of her commissions.
[6] Trustee disburses plan payments on a monthly basis. There is no suggestion that Trustee did not disburse according to her normal monthly disbursement schedule.
[7] In contrast, 11 U.S.C. § 1326(a)(2) requires that if a plan is confirmed, the Trustee "shall" distribute the preconfirmation payments in accordance with the plan "as soon as is practicable."
[8] In the course of a chapter 13 case there may well be two or more fee applications, depending on the length of the case and how well a debtor is progressing through the case.
[9] Because of the disposition of this matter, the Court need not consider In re Vigil, Case No. 07-10413-s13 (Bankr.D.N.M.) (see docs 61, 68 and 69, in which funds paid to a secured creditor were returned to the estate to pay Counsel's fees in that case). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534122/ | 415 B.R. 668 (2009)
In re Richard BLACKBURN and Victoria Blackburn, Debtor(s).
Marco J. Muscarello, individually and Marco J. Muscarello, derivatively on behalf of Eldercare Risk Management, Inc., Plaintiff(s),
v.
Richard Blackburn and Victoria Blackburn, Defendant(s).
Bankruptcy No. 07 B 05905. Adversary No. 07 A 00796.
United States Bankruptcy Court, N.D. Illinois, Eastern Division.
June 11, 2009.
*673 Abraham Brustein, Dimonte & Lizak, LLC, Park Ridge, IL, for Plaintiff.
James A. Young, James A. Young & Associates, Ltd., Elgin, IL, Richard G. Larsen, Myler, Ruddy & McTavish, Aurora, IL, for Defendants.
MEMORANDUM OPINION
MANUEL BARBOSA, Bankruptcy Judge.
This matter comes before the Court on the objections to discharge filed by plaintiffs Marco J. Muscarello, individually and Marco J. Muscarello, derivatively on behalf of Eldercare Risk Management, Inc., ("Plaintiffs"), pursuant to 11 U.S.C. § 523(a)(4), (a)(6), on August 14, 2007. Counsel for debtors Richard Blackburn and Victoria Blackburn ("Debtors") and Debtors' valuation expert filed motions for compensation for post-petition services in representation of Debtors in their adversary trial. For the reasons set forth herein, the Court sustains Plaintiffs' objections to discharge under § 523(a)(6) in Counts I and IV, and overrules Plaintiffs' objections to discharge under § 523(a)(4) in Counts II, III and V. Plaintiffs' compensatory damages are $385,638.04. In addition, Debtors' attorneys and valuation expert shall be afforded a priority Chapter 7 administrative claim, pursuant to 11 U.S.C. §§ 503(b)(2), 507(a)(2), 726(a)(1), but Debtors' attorneys and valuation expert are not entitled to immediate payment of their administrative claim, and, instead, shall be paid by the Chapter 7 trustee, pursuant to 11 U.S.C. § 726(a)(1).
JURISDICTION AND PROCEDURE
The Court has jurisdiction to decide these matters pursuant to 28 U.S.C. § 1334 and Internal Operating Procedure 15(a) of the United States District Court for the Northern District of Illinois. They are core proceedings pursuant to 28 U.S.C. § 157(b)(2)(J).
FACTS AND BACKGROUND
The following facts are taken from plaintiffs' Marco J. Muscarello, individually and Marco J. Muscarello, derivatively on behalf of Eldercare Risk Management, Inc. ("ECRM"), adversary complaint and from all public records and proceedings to which the parties refer. Many of the facts alleged in the complaint, which were admitted in the answer, are uncontested.
Debtors Richard Blackburn and Victoria Blackburn ("Debtors") filed a voluntary Chapter 13 bankruptcy petition on April 3, 2007. The meeting of creditors, pursuant to 11 U.S.C. § 341, was held on May 2, 2007 and objections to discharge were due by July 2, 2007, which was subsequently extended to August 17, 2007 by the Court's order. Plaintiffs served subpoenas to third-parties, accountants Charles J. Motl & Associates and attorney Thomas Young, as well as LegalZoom.com, Inc. for examination and documents, pursuant to Bankruptcy Rule 2004, and, in orders dated May 24, 2007, the Court granted Plaintiffs request for Rule 2004 discovery.
On August 14, 2007, Plaintiffs filed adversary complaint number 07-A-00796 to object to Debtors' discharge under five counts, pursuant to 11 U.S.C. §§ 523(a)(4), (a)(6). In Count I, Muscarello, acting derivatively *674 on behalf of ECRM, sought recovery of a non-dischargeable judgment against Debtors, pursuant to section 523(a)(6), for willful and malicious injury to property. In Count II, Muscarello, acting derivatively on behalf of ECRM, sought recovery of a non-dischargeable judgment against Debtors, pursuant to section 523(a)(4), for fraud or defalcation while acting in a fiduciary capacity. In Count III, Muscarello, acting derivatively on behalf of ECRM, sought recovery of a non-dischargeable judgment against Debtors, pursuant to section 523(a)(4) for larceny. In Count IV, Muscarello, acting individually, sought recovery of a nondischargeable judgment against Debtors, pursuant to section 523(a)(6), for willful and malicious injury to property. In Count V, Muscarello, acting individually, sought recovery of a nondischargeable judgment against Debtors, pursuant to section 523(a)(4), for fraud and defalcation while acting in a fiduciary capacity. Debtors filed an answer on October 5, 2007.
Debtors' modified Chapter 13 plan, filed September 6, 2007, was confirmed on September 10, 2007 and provided 100% payments to unsecured creditors over sixty (60) months. The order dated September 10, 2007 that confirmed Debtors' plan was vacated on September 20, 2007.
Regarding Plaintiffs' § 523 adversary complaint, the Court conducted a trial on March 10, 11, 12 and 16, 2009. On May 11, 2009, Debtors' attorneys, Myler, Ruddy & McTavish, and Debtors' valuation expert, James D. Keith, sought compensation for post-petition services in their representation of Debtors in their adversary trial as well as for priority cost of administrative claim, pursuant to 11 U.S.C. §§ 330, 503, 507. Debtors subsequently filed a motion to voluntary convert to Chapter 7 on May 13, 2009.
A little background is in order. In 1994, Debtor Richard Blackburn ("Blackburn") was a senior health care consultant at CNA insurance for approximately four years providing risk management consulting to long-term care nursing home accounts, (Blackburn Test., Tr. 3/10/09, 102-03), but CNA terminated his employment in November 1998 as part of an internal downsizing of Blackburn's department. (Stipulation of Facts ("Stip") No. 3) Blackburn then created Eldercare Risk Management, Inc. ("ECRM"), which was originally organized as an Illinois corporation in November 1998. (Stip No. 1) Initially, the corporation was called Windy Park Associates, Inc., (Stip No. 1), and Blackburn was the sole shareholder, director, and officer of Windy Park Associates, Inc. when he was issued 1,000 shares of common stock. (Stip No. 2) The services performed by ECRM were similar to the consulting services which Blackburn performed while at CNA. (Blackburn Test., Tr. 3/10/09, 102-103)
Plaintiff Mark Muscarello ("Muscarello") is both an attorney licensed to practice law and a licensed certified public accountant ("CPA") in the State of Illinois, but he retired from the active practice of law in 2001. (Stip No. 4) Blackburn's former domestic relations' attorney, Thomas Young, referred him to his law partner, Muscarello, who was the partner within the law firm that handled business matters. (Young Test., Tr. 3/11/09, 83-84) Muscarello was the attorney that prepared the organizational documents for Windy Park Associates, Inc. (Stip No. 5).
Shortly after the organization of Windy Park Associates, Inc., Blackburn and Muscarello reached an agreement which provided, among other things, that Muscarello would pay $2,000 for one-third of the issued and outstanding common shares of Windy Park Associates, Inc. (Stip No. 6) *675 On January 29, 1999, Windy Park Associates, Inc., filed Articles of Amendment to change the corporation name to Eldercare Risk Management, Inc. and increase the number of issued and authorized shares to 3,000, (Stip No. 7) On January 13, 1999, Richard Blackburn, as sole shareholder and director of Windy Park Associates, Inc., caused the by laws of the corporation to be amended to increase the number of directors to two persons, Muscarello and Blackburn. (Stip No. 8) No other person has served as an ECRM director at any time since January 13, 1999. (Stip No. 9) In a memorandum labeled "Directors Action" and dated December 27, 1999, Muscarello and Blackburn agreed to set Blackburn's annual salary at $50,000 beginning in 2000 and Muscarello's salary at $25,000 per year beginning when ECRM generated sufficient income to pay Muscarello's salary. (Pl.'s Ex. 1)
In November 2000, Blackburn asked Muscarello for additional funding for ECRM to meet its working capital needs. (Blackburn Test., Tr. 3/12/09, 68-69) Muscarello sought 50% ownership of the company in return for advancing $10,000 to ECRM from his wife's account. (Muscarello Test., Tr. 3/10/09, 32-33; Pl.'s Ex. 2; Blackburn Test., Tr. 3/12/09, 68-69, 98) In November 2000, Muscarello's wife, Patricia Muscarello, issued a check drawn upon her Merrill Lynch brokerage account payable to ECRM in the amount of $10,000, (Stip No. 15), and, although Blackburn claimed he was shocked by Muscarello's request for an increase in his percentage ownership of ECRM, he accepted the check; did not voice any objection to Muscarello becoming a 50% owner; and signed tax returns from 2001 through 2007 that showed Muscarello as the owner of 50% of the shares of ECRM. (Blackburn Test., Tr. 3/12/09, 46-47; PL's Exs. 5-10) Muscarello prepared ECRM's tax returns from 2000 through 2003, (Stip No. 13), while Charles Motl prepared the tax returns for ECRM for 2004, 2005, and 2006. (Stip No. 14) From the commencement of the engagement of his accounting firm, Motl understood that Muscarello was the owner of 50% of the shares of ECRM. (Motl Test., Tr, 3/10/09, 192) Moreover, Blackburn signed ECRM's 2004 through 2006 tax returns that indicated that both he and Muscarello owned 50% of the shares. (Plaintiffs Exs. 7-9)
Between 2001 and 2002, Muscarello and Blackburn had discussions about Muscarello further assisting ECRM in obtaining a line of credit from Amcore Bank for $25,000 which was eventually guaranteed by Muscarello. (Blackburn Test., Tr. 3/12/09, 79) According to Muscarello, in exchange for providing additional funding for ECRM to obtain financing, Muscarello and Blackburn, on behalf of ECRM, allegedly agreed to the "Ten Percent Agreement" which had the following elements:
A. Muscarello would sign the guaranty of the line of credit loan from Amcore Bank to ECRM;
B, Muscarello would relinquish whatever right he had to control the fiscal matters of ECRM and cede total control of fiscal decision making to Blackburn;
C. Muscarello would have no part in day to day management of the company or hiring and firing decisions; and
D. Muscarello would be entitled to receive as compensation and other benefits in the amount equal to 10% of the gross receipts of ECRM, adjusted to give credit for any salaries paid for insurance or other benefits paid to Muscarello or his wife; the amount due would be calculated each year and any unpaid balance would be reflected as a shareholder *676 loan on books and records of the company. Specifically, it would be shown on schedule L of the 1120 S tax return.
(Muscarello Test., Tr. 3/10/09, 41-44; Blackburn Test., Tr. 3/12/09, 79; Pl.'s Ex. 3, first para., 2). Blackburn testified that, on behalf of ECRM, he agreed to some form of this proposal, particularly that Muscarello would be entitled to 10% of ECRM's annual gross receipts. (Blackburn Test., Tr. 3/12/09, 79). The parties dispute whether the "Ten Percent Agreement" was memorialized in a written agreement or if the documents were misplaced, (Muscarello Test., Tr. 3/10/09, 44-46; Blackburn Test., Tr. 3/12/09, 92), but a written version of the "Ten Percent Agreement" was never submitted to the Court. During the entire course of the relationship of ECRM, Muscarello and Blackburn, Muscarello's maximum cash investment into ECRM did not exceed $18,000. (Muscarello Test., Tr. 3/10/09, 94).
Beginning in 2002 and continuing through 2006, ECRM's gross revenues were:
2002 - $731,706.00
2003 - $850,881.00
2004 - $655,694.00
2005 - $549,954.00
2006 - $476,218.00
(Blackburn's Ex. 2, 6; Pl.'s Exs. 5-9) In 2007, Beacon Risk Management, a subsequent, yet similar company created by Debtors, had gross revenues of $256,569.00. (Blackburn's Ex. 3, 7; Pl.'s Ex. 10) For tax years 2002 through 2006, schedule L of ECRM's 1120 S tax returns indicated loans from shareholders as:
Year - Beginning Total - End Total - Difference
2002 - $30,035.00 - $ 60,531.00 - $30,496.00[1]
2003 - $60,531.00 - $132,266.44 - $71,735.44[2]
2004 - $ 0.00 - $ 19,162.00[3] - $19,162.00[4]
2005 - $19,162.00 - $ 19,111.00[5] - $ 51.00[6]
2006 - $19,111.00 - $ 16,846.00[7] - ($2246.00)[8]
(PL's Exs. 5-9) Subtracting the adjustments paid to (1) Muscarello's wife for salary in 2002 and 2003; (2) Muscarello and his wife for health insurance premiums *677 in 2002 and 2003; and (3) Muscarello for cell phone service in 2003, under the "Ten Percent Agreement" and according to Muscarello, Muscarello is entitled to $300,451.44 from ECRM.
Item - Amount Due
Unpaid Shareholder loans as of
12/31/2003, per tax return - $132,266.44
10% of 2004 Gross Revenues - $ 65,569.40
10% of 2005 Gross Revenues - $ 54,995.40
10% of 2006 Gross Revenues - $ 47,621.80
Total: - $300,453.04
The relationship between Muscarello and Blackburn began to deteriorate in 2003. In July 2003, Muscarello decided to not guarantee a $150,000 line of credit for ECRM with Amcore Bank that was to be secured by ECRM's accounts receivable. (Muscarello Test., Tr. 3/10/09, 53-55; Muscarello Test., Tr. 3/16/09, 23-24; Pl.'s Exs. 3, 49) This led Blackburn to believe that Muscarello was no longer committed to the success of ECRM. (Pl.'s Exs. 48-49; Blackburn Test., Tr. 3/16/09, 13-14) Thus, Muscarello did not support Blackburn's proposed "Sapphire" project, which required the additional financing. (Muscarello Test., Tr. 3/16/09, 18-20) In addition, there was tension surrounding the office relocation from the shared space with Muscarello at the location of his old law firm, (Muscarello Test., Tr. 3/10/09, 34, 46-48), to another location where Blackburn and his wife Victoria Blackburn ("Victoria") relocated the offices. (Muscarello Test., Tr. 3/10/09, 46) Moreover, Blackburn never informed Muscarello of any of ECRM's financial problems and did not respond to Muscarello's letter dated May 10, 2006 about the state of the business of ECRM or the 2004 and 2005 income tax returns that Blackburn sent to Muscarello in early 2006. (Muscarello Test., Tr. 3/10/09, 67-71, 78-79; Pl.'s Ex. 15)
From the time of its organization until May 2005, Muscarello was the registered agent of ECRM, but, on May 6, 2005, without notifying Muscarello, Blackburn changed ECRM's registered agent to himself. (Stip No. 12; Muscarello Test., Tr. 3/10/09, 66-67) Furthermore, Blackburn did not ask Muscarello for advice, assistance or money to assist ECRM even though he knew Muscarello was an experienced business person, a lawyer experienced in business affairs, and a certified public accountant. Instead, Blackburn unilaterally decided to close ECRM in November 2006. (Blackburn Test., Tr. 3/10/09, 165, 169-70). Blackburn, without Muscarello's signature or consent, filed ECRM's Articles of Dissolution with the Illinois Secretary of State on January 18, 2007. (Pl.'s Ex. 46)
On December 11, 2006, Blackburn placed an order with LegalZoom to prepare and file organizational papers for Beacon Risk Management Services, Inc., ("Beacon"). (Stip No. 16) On December 11 and 12, 2006, Blackburn placed telephone calls and emailed the three principal ECRM customers for the purpose of informing them that he was forming a new business, dissolving ECRM, and transferring all RCRM business to Beacon. (Blackburn Test., Tr. 3/10/09, 141-53; Pl.'s Exs. 27-28) Blackburn intended that ECRM's former customers would not recognize any difference between ECRM and Beacon. (Blackburn Test., Tr. 3/10/09, 145-146) Blackburn and his wife Victoria were the sole shareholders, directors, and officers of Beacon from its inception. (Pl.'s Ex. 21; Stip No. 19) Beacon's Articles of Incorporation were filed with the Illinois Secretary of State on December 27, 2006. (Stip No. 17) Beacon began active business operations on January 2, 2007 from offices in the basement of the Blackburn's residence at 3119 Chatham Lane, Dundee, IL 60118. (Stip No. 18) Beacon performed the same services to the same ECRM customers and had the same business model. (Blackburn Test., Tr. 3/10/09, *678 216-217; Pl.'s Exs. 27-28) Even ECRM's old website directed former ECRM customers to Beacon until May 2007. (Muscarello Test, Tr. 3/10/09, 83-87; Pl.'s Exs. 34-36) Blackburn took four ECRM computers and moved them to his residence for use by Beacon. (Blackburn Test., Tr. 3/10/09, 154)
Blackburn and his wife, Victoria, held the ECRM board of directors meeting at their residence without the only other director Muscarello on December 14, 2006 and unilaterally made the decision to close ECRM, which was formalized in meeting minutes. (PL's Ex. 22) Prior to the December 14, 2006 meeting, no written notice of a meeting of directors was given to Muscarello. (Blackburn Test., Tr. 3/10/09, 208-09; Muscarello Test., Tr. 3/10/09, 79) Despite the assertions in the ECRM meeting minutes dated December 14, 2006, the decision to dissolve ECRM, discontinue its business, and form a successor company called Beacon had been made prior to December 14, 2006. There were conversations and emails between Blackburn and ECRM's three main customers on December 11, and 12, 2006. Blackburn engaged LegalZoom to incorporate Beacon on December 11, 2006 and prepared Beacon's Articles of Incorporation on December 12, 2006. Blackburn made no effort to contact Muscarello by telephone or otherwise when Muscarello was not in attendance December 14, 2006. (Blackburn Test., Tr. 3/10/09, 218-219) By instituting a board meeting on December 14, 2006, Blackburn understood and elected to not communicate to Muscarello that ECRM was dissolving; that Beacon was going to begin as a new entity with virtually the same business as RCRM on January 1, 2007; and that the arrangements for the dissolution of ECRM and the commencement of Beacon had been implemented as of December 12, 2006. (Blackburn Test., Tr. 3/10/09, 218-19)
Blackburn first notified Muscarello of the dissolution of ECRM and the winding up of its business on December 29, 2006, when he prepared a letter to Muscarello at his home in Arizona which included a draft ECRM's Articles of Dissolution. (Pl.'s Ex., 24) This letter made no reference to the December 14, 2006 meeting, related meeting minutes or the formation of Beacon. (Pl.'s Ex. 24)
Blackburn and his wife, Victoria, jointly prepared the final Articles of Dissolution, form BCA 12.20, dated December 29, 2006, and filed it with the Illinois Secretary of State on January 18, 2007. (Pl.'s Ex. 46) The Articles of Dissolution contained numerous errors and falsehoods, including: (1) At Section 3 of the Article of Dissolution, Blackburn and Victoria certified under penalty of perjury that the shareholders had either authorized the dissolution either by informal action or a formal meeting at which at least two-thirds of the shareholders affirmatively voted in favor dissolution in accordance with the provisions of Section 7.10 or 12.15 of the Illinois Business Corporation Act; and (2) in Section 3, the shareholders had executed written consent to the dissolution and that any shareholder, who did not consent, had been given written notice of the meeting at which action was taken in accordance with Section 7.10. (Pl.'s Ex. 46)
Beacon's December 2007 monthly statement, prepared by Motl, indicates that Blackburn received a salary from Beacon of $50,769.24 and that Victoria received a salary from Beacon of $25,384.56. (Pl.'s Ex. 42, Dec. 31, 2007 financial statement, 5) This was in addition to the shareholders distribution of $42,045.29 which equates to a total of $118,199.09 as compensation or ownership distributions from Beacon in 2007. (Pl.'s Ex. 42, Dec. 31, 2007 financial statement, 5)
*679 Valuation of ECRM
Muscarello called Jeffery Krol ("Krol") to give expert testimony concerning the value of ECRM (Krol Rpt., Pl.'s Ex. 45). Krol has been a CPA since 1976, has been an accounting firm owner since 1980, and has performed several hundred valuation assignments of small, closely held businesses over the past 25 years. (Krol Test., Tr. 3/11/09, 24; Krol Rpt., Ex. 45) Using the normalized income approach, pursuant to Internal Revenue Service ("IRS") Revenue Ruling 5960, Krol testified that the value of Muscarello's 50% ownership interest in ECRM at the end of 2006 was $166,727. (Pl.'s Ex. 45) Revenue Ruling 5960 requires the valuator to (1) determine what a hypothetical buyer and seller would agree to as a sales price to determine market value for a company, (Krol Test., Tr. 3/11/09, 39-40); and (2) make certain "normalizing" adjustments to the reported income statements. (Krol Test., Tr. 3/11/09, 30-33). Krol further testified that ECRM's principal asset was its goodwill generated by the business as reflected in current or expected future income. (Krol Test., Tr. 3/11/09, 41-42) Krol determined his valuation based on the results of ECRM's business operations in 2005 and 2006 as well as the results of Beacon's business operations in 2007, (Krol Test., Tr. 3/11/09, 29-33) Krol, however, did not offer any opinion regarding Beacon's value, Krol testified that ECRM's closing was not inevitable due to its tax liabilities because ECRM could have entered into an installment agreement with the taxing authorities, rather than use wages earned from Beacon to pay ECRM tax debt through their Chapter 13 plan. (Krol Rpt., Pl.'s Ex. 45, 3)
In opposition, Blackburn called James Keith ("Keith") to give expert testimony concerning the value of ECRM. (Keith Rpt., Blackburn's Ex. 2) Keith has performed valuations and handled troubled financial companies for at least twenty years, but he is neither a certified business valuator, nor a certified public accountant, nor does he have any formal training in accountancy or evaluation. (Keith Test., Tr. 3/12/09, 89-92, 108, 119) Keith testified that the value of Muscarello's 50% of ownership interest in ECRM at the end of 2006 was $0. (Keith Test., Tr. 3/12/09) Keith further testified that the value of 100% interest in Beacon was $23,100 at the end of 2007 and $14,900 at the end of June 2008. (Keith Test., Tr. 3/12/09) Thus, if Beacon's value is attached to ECRM's value, then the value of Muscarello's 50% ownership interest in Beacon at the end of 2007 was $11,550 and $7450 in June 2008. For his valuation, Keith utilized gross revenues for the year preceding the closing of ECRM without analyzing profit. (Keith Rpt., Blackburn's Ex. 2, 6-7; Keith Test., Tr. 3/12/09, 125-26) Keith testified that his ECRM valuation was based on the consistent decline in gross revenue from 2002 to 2006 and that ECRM experienced an operating loss of $25,000 in 2006. (Keith Rpt., Blackburn's Ex. 2, 6; Keith Test., Tr. 3/12/09, 126-29) Keith did not make any adjustments for income deferred from ECRM's orders in late 2006 that were deferred to 2007 when ECRM's business was transferred to Beacon. (Keith Test., Tr. 3/12/09, 126-27)
DISCUSSION
The main purpose of a discharge in bankruptcy is to give a debtor a fresh start. See Vill. of San Jose v. McWilliams, 284 F.3d 785, 790 (7th Cir.2002). The party that seeks to establish an exception to the discharge of a debt bears the burden of proof. Goldberg Sees., Inc. v. Scarlata (In re Scarlata), 979 F.2d 521, 524 (7th Cir.1992); Banner Oil Co. v. Bryson (In re Bryson), 187 B.R. 939, 957 (Bankr.N.D.Ill.1995), The United States *680 Supreme Court has held that the burden of proof required to establish an exception to discharge is a preponderance of the evidence. Grogan v. Garner, 498 U.S. 279, 291, 111 S. Ct. 654, 112 L. Ed. 2d 755 (1991); see also In re McFarland, 84 F.3d 943, 946 (7th Cir.1996); In re Thirtyacre, 36 F.3d 697, 700 (7th Cir.1994). Exceptions to discharge are to be construed strictly against a creditor and liberally in favor of a debtor. In re Morris, 223 F.3d 548, 552 (7th Cir.2000); Kolodziej v. Reines (In re Reines), 142 F.3d 970, 972-73 (7th Cir. 1998); In re Zarzynski, 771 F.2d 304, 306 (7th Cir.1985). "The statute is narrowly construed so as not to undermine the Code's purpose of giving the honest but unfortunate debtor a fresh start." Park Nat'l Bank & Trust of Chi. v. Paul (In re Paul), 266 B.R. 686, 693 (Bankr.N.D.Ill. 2001). Section 523 of the Bankruptcy Code enumerates specific, limited exceptions to the dischargeability of debts.
A. 11 U.S.C. § 523(a)(4)
Section 523(a)(4) provides as follows:
(a) A discharge under section 727 . . . does not discharge an individual debtor from any debt
. . .
(4) for fraud or defalcation while acting in a fiduciary capacity, embezzlement, or larceny[.]
11 U.S.C. § 523(a)(4). The meaning of these terms is a question of federal law. In re Burke, 398 B.R. 608, 625 (Bankr. N.D.Ill.2008) (citing In re McGee, 353 F.3d 537, 540 (7th Cir.2003)).
Most courts apply the general rule that the creditor bears the burden of proof in a proceeding to determine the dischargeability of a debt under section 523(a)(4). Fowler Bros. v. Young (In re Young), 91 F.3d 1367 (10th Cir.1996); Cobum Co. v. Nicholas (In re Nicholas), 956 F.2d 110 (5th Cir.1992); 4 COLLIER, ¶ 523.10[1][c].
"Fraud" for purpose of this exception has generally been interpreted as involving intentional deceit, rather than implied or constructive fraud. In re Tripp, 189 B.R. 29 (Bankr.N.D.N.Y.1995); In re McDaniel, 181 B.R. 883 (Bankr.S.D.Tex.1994); 4 COLLIER ON BANKRUPTCY 1523.10[1][a] (15th ed.2008).
"Defalcation" is not defined in the Bankruptcy Code, but the term "defalcation" has been used in the Bankruptcy Code since 1841. Meyer v. Rigdon, 36 F.3d 1375, 1382-83 (7th Cir.1994) (citing Central Hanover Bank & Trust Co. v. Herbst, 93 F.2d 510, 511 (2d Cir.1937) (the leading case defining "defalcation")). Judge Learned Hand in Herbst concluded that while a purely innocent mistake by the fiduciary may be dischargeable, a "defalcation" for purposes of this statute does not have to rise to the level of "fraud," "embezzlement," or even "misappropriation." Meyer, 36 F.3d at 1384 (citing Herbst, 93 F.2d at 512). The Seventh Circuit held that defalcation requires reckless conduct. Id. at 1385; In re Howard, 339 B.R. 913, 920-21 (Bankr.N.D.Ill.2006); 4 COLLIER, ¶ 523.10[1][b].
The Seventh Circuit has found that a fiduciary relationship exists for purposes of section 523(a)(4) when there is "a difference in knowledge or power between fiduciary and principal which . . . gives the former a position of ascendancy over the latter." Burke, 398 B.R. at 625 (quoting In re Marchiando, 13 F.3d 1111, 1116 (7th Cir.1994)); see also In re Woldman, 92 F.3d 546, 547 (7th Cir.1996) ("[S]ection 523(a)(4) reaches only those fiduciary obligations in which there is substantial inequality in power or knowledge."). Thus, a lawyer-client relationship, a director-shareholder relationship, and a managing partner-limited partner relationship all require *681 the principal to "repose a special confidence in the fiduciary." Burke, 398 B.R. at 625 (quoting In re Frain, 230 F.3d 1014, 1017 (7th Cir.2000)). Not all fiduciary relationships, however, fall within the purview of § 523(a)(4). Ibid, (citing Woldman, 92 F.3d at 547). A fiduciary relation qualifies under § 523(a)(4) only if it "imposes real duties in advance of the breach. ..." Ibid. (quoting Marchiando, 13 F.3d at 1116) (lottery agent not a "fiduciary"). Therefore, the fiduciary's obligation must exist prior to the alleged wrongdoing. Ibid. (citing Marchiando, 13 F.3d at 1116).
In larceny, felonious intent must exist at the time of the taking. BLACK'S LAW DICTIONARY (6th ed.1990); see United States Life Title Ins. Co. v. Dohm, 19 B.R. 134 (N.D.Ill.1982); see also 4 COLLIER, ¶ 523.10[2]. Thus, in larceny, the original taking must be unlawful. In re Brown, 399 B.R. 44, 47 (Bankr.N.D.Ind.2008) (citing In re Rose, 934 F.2d 901, 903 (7th Cir.1991) (discussing larceny); In re Hofmann, 144 B.R. 459, 464 (Bankr.D.N.D. 1992)). Larceny is proven for § 523(a)(4) purposes if the debtor has wrongfully and with fraudulent intent taken property from its owner. In re Rose, 934 F.2d at 903; see also Amcore Bank N.A. v. House, No. 07 C 4934, 2007 WL 2908815, at *1 (N.D.Ill. Oct. 4, 2007).
Here, the Court finds that there is not "a difference in knowledge or power between fiduciary and principal which ... gives the former a position of ascendancy over the latter." Burke, 398 B.R. at 625. Not all fiduciary relationships fall within the purview of § 523(a)(4). Ibid. Unlike a managing partner-limited partner relationship, Blackburn and Muscarello were equal or 50% partners. Moreover, Muscarello was not a principal who "repose[d] a special confidence in the fiduciary." Ibid. Instead, Muscarello, a CPA, was the partner in the law firm who handled business matters, (Young Test., Tr. 3/11/09, 83-84), and then prepared the organizational documents for ECRM. (Stip No. 5). Thus, Muscarello fails to meet his burden for fraud or defalcation while acting in a fiduciary capacity under section 523(a)(4).
The Court finds that Plaintiffs have not met their burden as to larceny under § 523(a)(4). The original taking must be unlawful. In re Brown, 399 B.R. at 47; In re Rose, 934 F.2d at 903. Plaintiffs argue that Blackburn misappropriated computers and committed larceny by his "unauthorized diversion" of $18,910.10 in orders placed with ECRM that were collected by Beacon in January 2007. Blackburn had a reasonable basis to conclude that this business would not be completed and paid until ECRM closed and Beacon had launched in its place. Thus, there was not the fraudulent intent necessary at the time of the original taking to constitute larceny under § 523(a)(4).
B. 11 U.S.C. § 523(a)(6)
Section 523(a)(6) provides as follows:
(a) A discharge under section 727 ... does not discharge an individual debtor from any debt
(6) for willful and malicious injury by the debtor to another entity or to the property of another entity[.]
11 U.S.C. § 523(a)(6).
To determine the non-dischargeability of a debt under section 523(a)(6), a creditor must prove three elements by a preponderance of the evidence: (1) the debtor intended to and caused an injury to the creditor's property interest; (2) the debtor's actions were willful; and (3) the debtor's actions were malicious. Burke, 398 B.R. at 625 (citing Baker Dev. Corp.v. Mulder (In re Mulder), 307 B.R. *682 637, 641 (Bankr.N.D.Ill.2004); Glucona Am., Inc. v. Ardisson (In re Ardisson), 272 B.R. 346, 356 (Bankr.N.D.Ill.2001)). The requirements of "willfulness" and "maliciousness" are distinct requirements in the statutory text and are usually treated as such by the courts. 4 COLLIER, ¶ 523.12[2]; see Carrillo v. Su (In re Su), 290 F.3d 1140 (9th Cir.2002).
"The word `willful' in (a)(6) modifies the word `injury,' indicating that nondischargeability takes a deliberate or intentional injury, not merely a deliberate or intentional act that leads to injury." Burke, 398 B.R. at 625 (quoting Kawaauhau v. Geiger, 523 U.S. 57, 61, 118 S. Ct. 974, 140 L. Ed. 2d 90 (1998)). Under Geiger and its stringent standards, to satisfy the requirements of § 523(a)(6), a creditor must plead and prove that the debtor actually intended to harm him and not merely that the debtor acted intentionally and he was thus harmed. Burke, 398 B.R. at 625-26 (citing Geiger, 523 U.S. at 61-62, 118 S. Ct. 974). Thus, the debtor must have intended the tortious consequences of his act, Burke, 398 B.R. at 626 (citing Geiger, 523 U.S. at 61-62, 118 S. Ct. 974; Berkson v. Gulevsky (In re Gulevsky), 362 F.3d 961, 964 (7th Cir.2004)). Injuries either negligently or recklessly inflicted do not come within the scope of § 523(a)(6). Ibid. (citing Geiger, 523 U.S. at 64, 118 S. Ct. 974).
The Supreme Court did not define the scope of the term "intent" utilized to describe willful conduct. Recent decisions, however, have found that either a showing of subjective intent to injure the creditor or a showing of a debtor's subjective knowledge that injury is substantially certain to result from his acts can establish the requisite intent required by Geiger. Burke, 398 B.R. at 626 (citing Markowitz v. Campbell (In re Markowitz), 190 F.3d 455, 463-65 (6th Cir.1999); Tex. By & Through Board of Regents of Univ. of Tex. Sys. v. Walker, 142 F.3d 813, 823 (5th Cir.1998); Su v. Carrillo (In re Su), 259 B.R. 909, 913 (9th Cir. BAP 2001), aff'd, 290 F.3d 1140 (9th Cir.2002); Fidelity Fin. Servs. v. Cox (In re Cox), 243 B.R. 713, 719 (Bankr.N.D.Ill.2000)). But see Miller v. J.D. Abrams, Inc. (In re Miller), 156 F.3d 598 (5th Cir.1998) (employing an objective standard under which the "willfulness" requirement is satisfied if there is either a subjective intent to cause injury or an objective certainty that the conduct will cause injury). Because a person will rarely admit to acting in a willful and malicious manner, those requirements must be inferred from the circumstances surrounding the injury. Burke, 398 B.R. at 626 (citing Cutler v. Lazzara (In re Lazzara), 287 B.R. 714, 723 (Bankr.N.D.Ill.2002)).
An act is "malicious" if it is taken "in conscious disregard of one's duties or without just cause or excuse...." Burke, 398 B.R. at 626 (quoting Thirtyacre, 36 F.3d at 700). The test for maliciousness under § 523(a)(6) is (1) a wrongful act, (2) done intentionally, (3) which causes injury to the creditor, and (4) is done without just cause and excuse. Ibid. (citing Paul, 266 B.R. at 696); see also Thirtyacre, 36 F.3d at 700. A debtor does not have to act with ill will or a specific intent to do harm to the creditor for the conduct to be malicious. Burke, 398 B.R. at 626 (citing Thirtyacre, 36 F.3d at 700). Whether an actor behaved willfully and maliciously is ultimately a question of fact reserved for the trier of fact. Ibid.
"Injury" means the violation of another's legal right or the infliction of an actionable wrong. Bukowski v. Patel, 266 B.R. 838, 844 (E.D.Wis.2001) (citing BLACK'S LAW DICTIONARY 785-86 (6th ed.1990)). Injuries covered under section 523(a)(6) are not confined to physical damage *683 or destruction; an injury to intangible personal or property rights is sufficient. See ibid, (citing In re Riso, 978 F.2d 1151 (9th Cir.1992) (contract rights); In re Rushing, 161 B.R. 984 (Bankr.E.D.Ark. 1993) (real property)); see also 4 COLLIER, ¶ 523.12[4]. The conversion of another's property without the owner's knowledge or consent, done intentionally and without justification and excuse, is a willful and malicious injury within the meaning of the exception. In re Meyer, 7 B.R. 932, 932 (Bankr.N.D.Ill.1981); see In re Moore, Nos. 98-70726, 98-7090, 1999 WL 33593323, at *2 (Bankr.C.D.Ill. Jan. 14, 1999); In re Lampi, 152 B.R. 543 (C.D.Ill. 1993); Sec. Bank of Nev. v. Singleton, 37 B.R. 787 (Bankr.D.Nev.1984); see also S.Rep.No. 989, 95th Cong., 2d Sess. 77 (1978), reprinted in 1978 U.S.Code Cong. & Ad. News 5787; 4 COLLIER, ¶ 523.12[4].
Here, Muscarello, derivatively and individually, has met his burden to satisfy his maliciousness claims under section 523(a)(6). The test for maliciousness under section 523(a)(6) is (1) a wrongful act, (2) done intentionally, (3) which causes injury to the creditor, and (4) is done without just cause and excuse. Burke, 398 B.R. at 626; Thirtyacre, 36 F.3d at 700. The decision to dissolve ECRM, form Beacon and transfer ECRM's business to Beacon was conceived and implemented by December 12, 2006 when Debtors informed ECRM's main customers that Beacon would replace ECRM as their service provider. In addition, Debtors had retained LegalZoom to form the new company and dissolve ECRM in December 2006. Then, in a board of directors meeting held on December 14, 2006. Debtors attempted to authorize the dissolution of ECRM, but Blackburn failed to inform the only other director, Muscarello, of the meeting.
Debtors understood and elected to not communicate to Muscarello that ECRM was dissolving; that Beacon was going to begin as a new entity with virtually the same business as ECRM on January 1, 2007; and that the arrangements for the dissolution of ECRM and the commencement of Beacon had been implemented as of December 12, 2006. Debtors also submitted a materially false Articles of Dissolution to the Illinois Secretary of State that indicated that the shareholders had approved the dissolutions, despite the fact that the majority of shareholders had not approved this action. Furthermore, Debtors intentionally diverted the majority of their ECRM business to Beacon since Beacon was not conditioned under the "Ten Percent Agreement." Blackburn testified that, on behalf of ECRM, he agreed to some form of the "Ten Percent Agreement" proposal, particularly the 10% annual gross receipts of ECRM to Muscarello. The only remaining question is the extent of injury to Muscarello.
The first question involves the value of the "Ten Percent Agreement." In exchange for providing additional funding for ECRM to obtain a line of credit from Amcore Bank for $25,000, Muscarello and Blackburn, on behalf of ECRM, agreed to the "Ten Percent Agreement" which provided that Muscarello would be entitled to receive as compensation an amount equal to 10% of the gross receipts of ECRM, adjusted to give credit for any salaries, medical insurance or other miscellaneous benefits. Subtracting the adjustments paid to (1) Muscarello's wife for salary in 2002 and 2003; (2) Muscarello and his wife for health insurance premiums in 2002 and 2003; and (3) Muscarello for cell phone service in 2003, under the 10% Agreement, Muscarello is entitled to $300,453.04 from ECRM.
The second question on the value of injury involves the valuation of ECRM when it closed. Two competing experts, *684 Krol for Muscarello and Keith for Debtors, gave testimony regarding the value of ECRM. Using the normalized income approach, pursuant to IRS Revenue Ruling 5960, Krol testified that the value of Muscarello's 50% ownership interest in ECRM at the end of 2006 was $166,727. (PL's Ex. 45) In contrast, Keith found that the value of Muscarello's 50% of ownership interest in ECRM as of the end of 2006 was $0 because ECRM has no value. (Keith Rpt., Blackburn's Ex. 2) ECRM experienced a consistent decline in gross revenue from 2003 ($850,881.00) to 2006 ($476,218.00).
There are a number of factors that distinguish Krol's ECRM valuation from Keith's ECRM valuation. Krol has more experience with service companies, such as ECRM, and more extensive formal training, than Keith. Keith made no adjustments for ECRM's deferral of income to Beacon. Keith mainly focused on gross revenues, but he did not conduct a thorough profit analysis. Most significantly, while Keith found that ECRM had no value at the end of 2006, he did find that the successor company, Beacon, which has an identical business and customer base to ECRM, did have value in 2007. In light of these factors, the Court does not agree with Keith that ECRM had no value at the end of 2006.
The Court must next review Krol's normalization approach. To determine ECRM's valuation, Krol made several adjustments or normalizations to ECRM's 2005 and 2006 income statements, including: outside services; rent; salaries: officers; salaries: general; payroll taxes; and travel and lodging. In addition, the Court agrees with Krol's testimony that consistently performing insurance consulting agencies typically sell at five (5) to six (6) times earnings, and, a potential buyer would require Blackburn's expertise which necessitates ECRM's multiple of earnings of four (4). The Court also concurs with Krol's assessment that ECRM should be discounted by 33.33% for its lack of marketability and lack of control.
The Court agrees with Krol's adjustments for "salaries: officers" and its related "Taxes: Payroll," but it does not agree with the remaining adjustments for outside services, rent, travel and lodging, and "Salaries: General." In the "Directors Action" memorandum dated December 27, 1999, both parties agreed to set Blackburn's annual salary at $50,000 beginning in 2000. Thus, the Court agrees with this adjustment under Salaries: Officers for Blackburn's salary. In 2005, ECRM made four "outside consultant" payments to Blackburn and his wife Victoria for $129,916. Since it is not clear from the record whether these payments were for services within the duties contracted under the "Directors Action" memorandum, nor is it specified how much Victoria, who is not listed in the "Directors Action" memorandum, contributed, the Court will not adjust these figures. The Court also does not agree that rent should be valued at $0 or that ECRM's office must be administered from Blackburn's residence. Regarding Krol's adjustment for "Salaries: General," the Court does not agree with Krol's adjustments for Victoria's salary because it is not entirely clear from the record what services Victoria provided, there is no salary agreement similar to the "Directors Action" memorandum, and Victoria's salaries of $30,273 in 2005 and $27,829 in 2006 appear reasonable for an additional assistant, if that was ultimately her role. Travel and lodging was not appropriate deduction because the disputed entries involved a valid business trip to a Hawaiian client, Payroll taxes were adjusted *685 accordingly.[9] Based on these adjustments and utilizing Krol's normalized income approach, the value of Muscarello's 50% ownership interest in BCRM at the end of 2006 was $85,185.
Average Normalized Net Income
(2005 & 2006) - $ 63,889[10]
Multiple of Earnings - 4
--------
Fair Market Value of ECRM - $255,555
Discount for lack of marketability and
lack of control @ 33.3% - ($85.185)
---------
Enterprise Value of ECRM at 12/31/06
net of Discounts - $170,370
---------
Fair Market Value of Muscarello's 50%
Ownership Interest in ECRM at 12/31/06 - $ 85,185
Thus, under the "Ten Percent Agreement," Muscarello is entitled to $300,453.04 from ECRM and Muscarello is entitled to the fair market value of Muscarello's 50% ownership interest in ECRM as of December 31, 2006 which equaled $85,185. Therefore, Muscarello's compensatory damages are $385,638.04.
C. Request for Punitive Damages
Punitive damages are not intended to compensate the injured party, but rather to punish the defendant and to deter him and others from similar conduct. E.E.O.C. v. Waffle House, Inc., 534 U.S. 279, 295, 122 S. Ct. 754, 151 L. Ed. 2d 755 (2002). In a bench trial, the decision to award punitive damages is within the discretion of the trial court. Merritt v. De Los Santos, 721 F.2d 598, 601 (7th Cir. 1983) (citing Busche v. Burkee, 649 F.2d 509 (7th Cir.), cert. denied, 454 U.S. 897, 102 S. Ct. 396, 70 L. Ed. 2d 212 (1981)). Courts apply state law to determine punitive damages under § 523(a), Cohen v. de la Cruz, 523 U.S. 213, 223, 118 S. Ct. 1212, 140 L. Ed. 2d 341 (1998), and Illinois law views punitive damages as a punishment. Kochan v. Owens-Corning Fiberglass Corp., 242 Ill.App.3d 781, 182 Ill. Dec. 814, 610 N.E.2d 683, 693 (1993), appeal denied, 152 Ill. 2d 561, 190 Ill. Dec. 891, 622 N.E.2d 1208 (1993); see also In re H. King & Assocs., 295 B.R. 246, 276 (Bankr.N.D.Ill. 2003). Although punitive damages are generally disfavored because of their penal nature, punitive damages may be awarded where the defendant committed a tort with actual malice. In re Misna, Nos. 01-B-03732, 01-A-0422, 2003 WL 21785648, at *9 (Bankr.N.D.Ill. July 31, 2003) (citing Lowe Excavating Co. v. Int'l Union of Operating Eng'rs Local No. 150, 327 Ill. App. 3d 711, 262 Ill. Dec. 195, 765 N.E.2d 21, 34 (2002), appeal denied, 199 Ill. 2d 557, 266 Ill. Dec. 441, 775 N.E.2d 3 (2002)). Where pre-petition conduct justifies the award of punitive damages, a bankruptcy court may include those punitive damages in the judgment finding non-dischargeability. Ibid. (citing Diaz v. Diaz (In re Diaz), 120 B.R. 967, 982 (Bankr.N.D.Ind.1989)). In an appropriate case of breach of fiduciary duty, punitive damages may be awarded. *686 In re McCook Metals, L.L.C., 319 B.R. 570, 597 (Bankr.N.D.Ill.2005) (citing Levy v. Markal Sales Corp., 268 Ill.App.3d 355, 205 Ill. Dec. 599, 643 N.E.2d 1206, 1222-23 (1994)). For instance, egregious circumstances, such as "underhanded, deceitful and sly" conduct, may give rise to punitive damages. In re McCook Metals, L.L.C., 319 B.R. at 598 (citing Levy, 205 Ill. Dec. 599, 643 N.E.2d at 1223).
Muscarello argues that Blackburn's actions as a corporate officer willfully violated his corporate fiduciary duties and supports an award of punitive damages, citing E.J. McKernan Co. v. Gregory, 252 Ill. App. 3d 514, 191 Ill. Dec. 391, 623 N.E.2d 981, 997-98 (1993) and Levy, 268 Ill.App.3d at 379-80, 205 Ill. Dec. 599, 643 N.E.2d 1206. In Gregory, the jury properly awarded punitive damages when corporate officers concealed transactions from the McKernan company by directing those opportunities to other corporations that the officers had formed in competition with the McKernan company. Id. at 990. The officers had secretly formed new entities in direct competition with the McKernan company and utilized the same employees and processes to do so. Id. at 987-88. In Levy, the court awarded punitive damages when directors of a corporation that acted as sales representative for consumer electronics formed a new entity to act as sales representative for Apple computers, used corporate assets to benefit their new venture and conspired to actively conceal their actions from the other shareholders. 643 N.E.2d at 379-80.
The Court finds that Muscarello is not entitled to punitive damages. As noted in part A, Debtors were not liable as fiduciaries under § 523(a)(4), and, thus, unlike the corporate officers in Gregory and Levy, Debtors did not breach a fiduciary duty. Moreover, despite Debtors pre-petition conduct, the Court finds that these actions do not rise to the level of "underhanded, deceitful and sly" conduct to warrant punitive damages.
D. Administrative Claim for Attorney's Fees
Prior to Debtors' conversion from Chapter 13 to Chapter 7, Debtors' attorneys, Myler, Ruddy & McTavish, and Debtors' valuation expert, James D. Keith, sought compensation for post-petition services in their representation of Debtors in their adversary trial and priority cost of administrative claim, pursuant to 11 U.S.C. §§ 330, 503, 507.
Section 329(b) of the Bankruptcy Code effectively allows the Court to determine whether the fees charged by the debtor's attorney are excessive and, if so, the Court may cancel any compensation agreement between the attorney and the client. See In re Mortakis, 405 B.R. 293, 297 (Bankr.N.D.Ill.2009) (citing In re Wiredyne, Inc., 3 F.3d 1125, 1127 (7th Cir. 1993)). Section 329(a) requires a debtor's attorney to "file with the court a statement of the compensation paid or agreed to be paid ... and the source of such compensation." Ibid. (quoting 11 U.S.C. § 329(a)), Bankruptcy courts have wide discretion to determine reasonable compensation for actual and necessary services. In re Wildman, 72 B.R. 700, 705 (Bankr.N.D.Ill. 1987).
Section 330(a)(1) provides:
(a)(1) After notice to the parties in interest and the United States Trustee and a hearing, and subject to sections 326, 328, and 329, the court may award to ... a professional person employed under section 327 or 1103
(A) reasonable compensation for actual, necessary services rendered by the... professional person, or attorney *687 and by any paraprofessional person employed by any such person; and
(B) reimbursement for actual, necessary expenses.
11 U.S.C. § 330(a) (2006). Thus, pursuant to 11 U.S.C. § 330(a)(3), courts should consider six factors to determine whether or not to award attorney fees. Section 330 states, in relevant part:
(a)(3) In determining the amount of reasonable compensation to be awarded to... [a] professional person, the court shall consider the nature, the extent, and the value of such services, taking into account all relevant factors, including
(A) the time spent on such services;
(B) the rates charged for such services
(C) whether the services were necessary to the administration of, or beneficial at the time at which the service was rendered toward the completion of, a case under this title;
(D) whether the services were performed within a reasonable amount of time commensurate with the complexity, importance, and nature of the problem, issue, or task addressed;
(E) with respect to a professional person, whether the person is board certified or otherwise has demonstrated skill and experience in the bankruptcy field; and
(F) whether the compensation is reasonable based on the customary compensation charged by comparably skilled practitioners in cases other than cases under this title.
11 U.S.C. § 330(a)(3)(A)-(F). The plain language of § 330(a)(4)(B) allows compensation for services that benefit the debtor. In re Lee, 209 B.R. 708, 710 (Bankr. N.D.Ill.1997). It also allows the court to consider the six factors in § 330(a)(3).
"Once a question has been raised about the reasonableness of the attorney's fee under [§] 329, it is the attorney himself who bears the burden of establishing that the fee is reasonable." In re Geraci, 138 F.3d 314, 318 (7th Cir.1998): see also In re Wildman, supra, 72 B.R. 700 at 708. The legislative history for § 329 states that "[p]ayments to a debtor's attorney provide serious potential for evasion of creditor protection provisions of the bankruptcy laws, and serious potential for overreaching by the debtor's attorney, and should be subject to careful scrutiny." In re Mortakis, 405 B.R. at 299-300 (Bankr. N.D.Ill.2009) (quoting H.R. REP. NO. 95-595, at 329 (1977), as reprinted in 1978 U.S.C.C.A.N. 5787, 6285) (emphasis supplied).
Section 329(a) requires a debtor's attorney to "file with the court a statement of the compensation paid or agreed to be paid ... and the source of such compensation." 11 U.S.C. § 329(a). Fee disclosure under § 329 and the Rules is mandatory, not permissive. In re Mortakis, supra, 405 B.R. at 299-300 (citing In re Whaley, 282 B.R. 38, 41 (Bankr.M.D.Fla.2002)). Failure to disclose is sanctionable and can include partial or total denial of compensation, as well as partial or total disgorgement of fees already paid. See In re Prod. Assocs., Ltd., 264 B.R. 180, 186, 189 (Bankr.N.D.Ill.2001),
Under the Federal Rules of Bankruptcy Procedure 2016, to establish actual and necessary services when an applicant files an application for compensation, an applicant shall submit a detailed statement of the services rendered, time expended and expenses incurred as well as the amounts requested. In re Wildman, supra, 72 B.R. at 707 (citing Fed. R. Bankr.P. 2016). The detailed statement establishes the "actual" requirement, while an accompanying narrative explanation of *688 the "how" and "why" establishes the "necessary" requirement. Ibid.
In addition, Local Bankruptcy Rule 5082-2 and General Order 07-02 identify the requirements for the contents of an application for compensation made by a professional, including a debtor's attorney, under a Chapter 13 case. Bankr.N.D. Ill. R. 5082-2; Bankr.N.D. Ill. Gen. Order 07-02. If a debtor's counsel and debtor enter into a Model Retention Agreement, then counsel may apply for a flat fee not to exceed $3500. Bankr.N.D. Ill. R. 5082-2. If the debtor's counsel and debtor have not entered into a Model Retention Agreement, then counsel must include a completed form itemization with the fee application. Ibid.
Section 503 of the Bankruptcy Code provides for the "allowance" of administrative expenses and derives its importance from section 507. 4 COLLIER, ¶ 503.01. Section 507 provides that certain categories of expenses and claims have priority in the distribution of the assets of the estate. Ibid. Specifically, section 507(a)(2) sets forth second priority for administrative expenses allowed under section 503(b). Ibid. Thus, section 503(b)(2) provides:
(b) After notice and a hearing, there shall be allowed administrative expenses, other than claims allowed under section 502(f) of this title, including
(2) compensation and reimbursement awarded under section 330(a) of this title[.]
11 U.S.C. § 503(b)(2). Section 507(a)(2) then provides:
(a) The following expenses and claims have priority in the following order:
(2) Second, administrative expenses allowed under section 503(b) of this title, and any fees and charges assessed against the estate under chapter 123 of title 28.
11 U.S.C. § 507(a)(2) (2006).
In a Chapter 13 case, section 330(a)(4)(B) provides that the court may allow reasonable compensation to the debtor's attorney for representing the interests of the debtor in connection with the bankruptcy case. 11 U.S.C. § 330(a)(4)(B); see also In re Met-L-Wood Corp., 103 B.R. 972, 975 (Bankr.N.D.Ill.1989). In addition, section 331, in conjunction with Bankruptcy Rule 2016, allows any professional person employed pursuant to § 327 or § 1103 of the Code, to apply to the court for interim compensation and reimbursement. In re Met-L-Wood Corp., 103 B.R. at 975-76 (citing 11 U.S.C. § 331), Moreover, the allowance of a claim for reasonable compensation to the debtor's attorney is an administrative expense, entitled to priority distribution under 11 U.S.C. § 507. See id. at 976. To determine whether to approve an interim compensation application, the court must weigh important competing interests. Ibid. For instance, the primary policy behind the awarding of interim compensation under § 331 is to relieve attorneys from the burden of financing lengthy and complex bankruptcy proceedings. Ibid. (citing In re UNR Indus., Inc., 72 B.R. 796, 798-99 (Bankr.N.D.Ill.1987) (Chapter 11)). On the other hand, the court must also weigh the interests of preserving the estate and protecting its various classes of creditors. Ibid. (citing In re Tri-County Water Ass'n, Inc., 91 B.R. 547, 549 (Bankr.D.S.D.1988)). It is well-settled that a debtor's attorney is not entitled to compensation from the estate unless his services benefitted the estate. Ibid. (citing In re Ryan, 82 B.R. 929 (N.D.Ill. 1987)).
Here, Debtor's attorneys and valuation experts defended Debtor in a four-day adversary trial that represented, one of the *689 largest claims in Debtor's estate. Thus, Debtors' attorneys and their valuation expert are entitled to an administrative expense, entitled to priority distribution under 11 U.S.C. § 507. The only remaining question is the timing of payment of these allowed administrative expenses.
The Bankruptcy Code does not set forth the appropriate timing of payment of allowed administrative expenses in Chapter 13. See 4 COLLIER, ¶ 503.03. The timing for payment of administrative claims, however, is within the discretion of the bankruptcy court. Varsity Carpet Servs., Inc. v. Richardson (In re Colortex Indus., Inc.), 19 F.3d 1371, 1384 (11th Cir.1994); Spartan Plastics v. Verco Indus. (In re Verco Indus.), 20 B.R. 664, 665 (9th Cir. BAP 1982); Journeymen Plasterers Protective & Benevolent Soc'y Local No. v. Energy Insulation, Inc. (In re Energy Insulation, Inc.), 143 B.R. 490, 496 (N.D.Ill.1992). In considering the timing of administrative claim payments, courts review, inter alia, the following factors: the status of the case; the ability of the debtor to pay present claims; the particular needs of the administrative claimants; and the possibility that future administrative claims may not be paid in full. See, e.g., Verco Indus. (In re Verco Indus.), 20 B.R. at 665; Energy Insulation, Inc., 143 B.R. at 496; In re United West, Inc., 87 B.R. 138, 141 (Bankr.D.Nev.1988). Minimally, in the Chapter 13 context, courts have authority to order payment of attorney's fees over the life of the debtors' plans, rather than in full before payments to other creditors begin. See In re Lanigan, 101 B.R. 530, 532 (Bankr.N.D.Ill. 1986). In a Chapter 7 proceeding, section 726(a)(1) requires that administrative expenses be paid first upon a distribution of the assets of an estate. See U.S. v. Noland, 517 U.S. 535, 540, 116 S. Ct. 1524, 134 L. Ed. 2d 748 (1996); In re Johnson Rehabilitation Nursing Home, Inc., 239 B.R. 168, 180 (Bankr.N.D.Ill.1999).
In light of the Debtors' recent conversion to Chapter 7, Debtors' attorneys and valuation expert are not entitled to immediate payment of their administrative claims. When the Chapter 7 trustee makes distributions from the estate, then the outstanding administrative expenses, including the compensation from Debtors' attorneys and the Debtors' expert relating to this adversary proceeding, shall be paid, pursuant to 11 U.S.C. § 726(a)(1).
CONCLUSION
For the foregoing reasons, the Court sustains Plaintiffs' objections to discharge under § 523(a)(6) in Counts I and IV, and overrules Plaintiffs' objections to discharge under § 523(a)(4) in Counts II, III and V. Under the "Ten Percent Agreement," Plaintiffs are entitled to $300,453.04 from ECRM Plaintiffs are also entitled to the fair market value of Muscarello's 50% ownership interest in ECRM as of December 31, 2006 which equaled $85,185. Therefore, Plaintiffs' compensatory damages are $385,638.04. Plaintiffs' request for punitive damages is denied.
In addition, the compensation for post-petition services in representation of Debtors in their adversary trial from Debtors' attorneys and valuation expert shall be afforded a priority Chapter 7 administrative claim, pursuant to 11 U.S.C. §§ 503(b)(2), 507(a)(2), 726(a)(1), but Debtors' attorneys and valuation expert are not entitled to immediate payment of their administrative claim, and, instead, shall be paid by the Chapter 7 trustee, pursuant to 11 U.S.C. § 726(a)(1).
THEREFORE, IT IS ORDERED that the foregoing constitutes findings of fact and conclusions of law as required by Fed. R.Civ.P. 52(a) and Fed. R. Bankr.P. 7052. A separate order shall be entered pursuant *690 to Fed. R. Bankr.P. 9021 giving effect to the determinations reached herein.
MEMORANDUM OPINION
This matter comes before the Court on the motion to alter or amend the Court's June 11, 2009 judgment filed by debtors Richard Blackburn and Victoria Blackburn ("Debtors"), pursuant to Federal Rules of Bankruptcy Procedure 9023 and 7052 as well as Federal Rule of Civil Procedure 59(e), on June 19, 2009. For the reasons set forth herein, the Court grants in part and denies in part Debtors' motion to alter or amend, upon reconsideration of the Court's June 11, 2009 order and memorandum, the Court sustains Plaintiffs' objections to discharge under § 523(a)(6) in Count IV, and overrules Plaintiffs' objections to discharge under § 523(a)(6) in Count I. Plaintiffs' compensatory damages remain $385,638.04. Debtors' request to reconsider the liability of Victoria Blackburn is denied.
In addition, the Court's June 11, 2009 order granting administrative expense claim priority to Debtors' counsel's and valuation expert's applications for compensation shall be vacated. Debtors' counsel's and valuation expert's request for administrative priority on their individual applications for compensation requires the requisite notice and hearing, pursuant to 11 U.S.C. § 503(b)(2). Accordingly, the Court will notice the parties-in-interest and set both professional fee applications for hearing on September 18, 2009.
JURISDICTION AND PROCEDURE
The Court has jurisdiction to decide these matters pursuant to 28 U.S.C. § 1334 and Internal Operating Procedure 15(a) of the United States District Court for the Northern District of Illinois. They are core proceedings pursuant to 28 U.S.C. § 157(b)(2)(J).
FACTS AND BACKGROUND
The following facts are taken from plaintiffs' Marco J. Muscarello, individually and Marco J. Muscarello, derivatively on behalf of Eldercare Risk Management, Inc. ("ECRM"), adversary complaint and from all public records and proceedings to which the parties refer. Many of the facts alleged in the complaint, which were admitted in the answer, are uncontested. The procedural and factual history was outlined in the Court's previous memorandum, dated June 11,2009.
Debtors Richard Blackburn and Victoria Blackburn ("Debtors") filed a voluntary Chapter 13 bankruptcy petition on April 3, 2007. The meeting of creditors, pursuant to 11 U.S.C. § 341, was held on May 2, 2007 and objections to discharge were due by July 2, 2007, which was subsequently extended to August 17, 2007 by the Court's order. Plaintiffs served subpoenas to third-parties, accountants Charles J. Motl & Associates and attorney Thomas Young, as well as LegalZoom.com, Inc. for examination and documents, pursuant to Bankruptcy Rule 2004, and, in orders dated May 24, 2007, the Court granted Plaintiffs request for Rule 2004 discovery.
On August 14, 2007, Plaintiffs filed adversary complaint number 07-A-00796 to object to Debtors' discharge under five counts, pursuant to 11 U.S.C. §§ 523(a)(4), (a)(6). In Count I, Muscarello, acting derivatively on behalf of ECRM, sought recovery of a non-dischargeable judgment against Debtors, pursuant to section 523(a)(6), for willful and malicious injury to property. In Count II, Muscarello, acting derivatively on behalf of ECRM, sought recovery of a non-dischargeable judgment against Debtors, pursuant to section 523(a)(4), for fraud or defalcation while acting in a fiduciary capacity. In Count III, Muscarello, acting derivatively on behalf *691 of ECRM, sought recovery of a non-dischargeable judgment against Debtors, pursuant to section 523(a)(4) for larceny. In Count IV, Muscarello, acting individually, sought recovery of a nondischargeable judgment against Debtors, pursuant to section 523(a)(6), for willful and malicious injury to property. In Count V, Muscarello, acting individually, sought recovery of a nondischargeable judgment against Debtors, pursuant to section 523(a)(4), for fraud and defalcation while acting in a fiduciary capacity. Debtors filed an answer on October 5, 2007.
Debtors' modified Chapter 13 plan, filed September 6, 2007, was confirmed on September 10, 2007 and provided 100% payments to unsecured creditors over sixty (60) months. The order dated September 10, 2007 that confirmed Debtors' plan was vacated on September 20, 2007.
Regarding Plaintiffs' § 523 adversary complaint, the Court conducted a trial on March 10, 11, 12 and 16, 2009. On May 11, 2009, Debtors' attorneys, Myler, Ruddy & McTavish, and Debtors' valuation expert, James D. Keith, sought compensation for post-petition services in their representation of Debtors in their adversary trial as well as for priority cost of administrative claim, pursuant to 11 U.S.C. §§ 330, 503, 507. Debtors subsequently filed a motion to voluntary convert to Chapter 7 on May 13, 2009.
In the June 11, 2009 order and memorandum, the Court sustained Plaintiffs' objections to discharge under § 523(a)(6) in Counts I and IV, and overruled Plaintiffs' objections to discharge under § 523(a)(4) in Counts II, III and V. Under the "Ten Percent Agreement," Plaintiffs were entitled to $300,453.04 from ECRM. Plaintiffs were also entitled to the fair market value of Muscarello's 50% ownership interest in ECRM as of December 31, 2006 which equaled $85,185. Plaintiffs' compensatory damages were $385,638.04. Plaintiffs' request for punitive damages was denied. In addition, the compensation for post-petition services in representation of Debtors in their adversary trial from Debtors' attorneys and valuation expert was afforded a priority Chapter 7 administrative claim, pursuant to 11 U.S.C. §§ 503(b)(2), 507(a)(2), 726(a)(1), but Debtors' attorneys and valuation expert are not entitled to immediate payment of their administrative claim, and, instead, shall be paid by the Chapter 7 trustee, pursuant to 11 U.S.C. § 726(a)(1).
On June 19, 2009, Debtors filed a motion to alter or amend the Court's June 11, 2009 judgment, pursuant to Federal Rules of Bankruptcy Procedure 9023 and 7052 as well as Federal Rule of Civil Procedure 59(e). On July 24, 2009, Plaintiffs filed a response.
On July 25, 2009, the Chapter 7 trustee filed a no asset report.
DISCUSSION
Technically, a "motion for reconsideration" does not exist under either the Federal Rules of Bankruptcy Procedure or the Federal Rules of Civil Procedure. The Seventh Circuit, however, has indicated that Rule 59(e) governs such a motion, which should properly be termed a "Motion to Alter or Amend Judgment." Talano v. Nw. Med. Faculty Found., 273 F.3d 757, 760 n. 1 (7th Cir.2001). Pursuant to the Federal Rule of Bankruptcy Procedure 9023, Federal Rule of Civil Procedure 59(e) applies in cases under the Bankruptcy Code. Fed. R. Bankr.P. 9023.
Rule 59(e) allows a party to direct the district court's attention to newly discovered material evidence or a manifest error of law or fact, and enables the court to correct its own errors and thus avoid the unnecessary appellate procedures. The rule does not provide a vehicle *692 for a party to undo its own procedural failures, and it certainly does not allow a party to introduce new evidence or advance arguments that could and should have been presented to the district court prior to the judgment.
Moro v. Shell Oil Co., 91 F.3d 872, 876 (7th Cir.1996) (citations omitted).
The main purpose of a discharge in bankruptcy is to give a debtor a fresh start. See Vill. of San Jose v. McWilliams, 284 F.3d 785, 790 (7th Cir.2002). The party that seeks to establish an exception to the discharge of a debt bears the burden of proof. Goldberg Sees., Inc. v. Scarlata (In re Scarlata), 979 F.2d 521, 524 (7th Cir.1992); Banner Oil Co. v. Bryson (In re Bryson), 187 B.R. 939, 957 (Bankr.N.D.Ill.1995). The United States Supreme Court has held that the burden of proof required to establish an exception to discharge is a preponderance of the evidence. Grogan v. Garner, 498 U.S. 279, 291, 111 S. Ct. 654, 112 L. Ed. 2d 755 (1991); see also In re McFarland, 84 F.3d 943, 946 (7th Cir.1996); In re Thirtyacre, 36 F.3d 697, 700 (7th Cir.1994). Exceptions to discharge are to be construed strictly against a creditor and liberally in favor of a debtor. In re Morris, 223 F.3d 548, 552 (7th Cir.2000); Kolodziej v. Reines (In re Reines), 142 F.3d 970, 972-73 (7th Cir. 1998); In re Zarzynski, 771 F.2d 304, 306 (7th Cir.1985). "The statute is narrowly construed so as not to undermine the Code's purpose of giving the honest but unfortunate debtor a fresh start." Park Nat'l Bank & Trust of Chi. v. Paul (In re Paul), 266 B.R. 686, 693 (Bankr.N.D.Ill. 2001). Section 523 of the Bankruptcy Code enumerates specific, limited exceptions to the dischargeability of debts.
Section 523(a)(6) provides as follows:
(a) A discharge under section 727 ... does not discharge an individual debtor from any debt
. . . .
(6) for willful and malicious injury by the debtor to another entity or to the property of another entity[.]
11 U.S.C. § 523(a)(6).
Debtors first request that the Court reconsider its ruling under 11 U.S.C. § 523(a)(6) for $300,453.04 in damages from the "Ten Percent Agreement." In an order dated June 11, 2009, pursuant to 11 U.S.C. § 523(a)(6), the Court entered judgment in favor of Muscarello and against Debtors on Counts I and IV of the adversary complaint in the amount of $385,638.04, including $300,453.04 from the "Ten Percent Agreement." Count I was brought derivatively on behalf of ECRM, while Count IV was brought individually by Muscarello. The "Ten Percent Agreement" allocation in the damages is not recoverable in Count I, as part of the derivative claim, because ECRM cannot owe money to itself. Regarding Count IV, pursuant to 11 U.S.C. § 523(a)(6), the Court finds, by a preponderance of the evidence, that Debtors' actions in dissolving ECRM, forming Beacon and transferring ECRM's business to Beacon was (1) a wrongful act, (2) done intentionally, (3) which caused injury to Muscarello, and (4) was done without just cause and excuse. In re Burke, 398 B.R. 608, 625 (Bankr. N.D.Ill.2008).
Debtors engaged in conduct that qualifies as willful and malicious injury to property. Kawaauhau v. Geiger, 523 U.S. 57, 61, 118 S. Ct. 974, 140 L. Ed. 2d 90 (1998); In re Burke, 398 B.R. at 625. By unilaterally closing ECRM and transferring ECRM's business to Beacon, Debtors enriched themselves at the expense of Muscarello and made it impossible for ECRM to pay the debt that it owed Muscarello under the "Ten Percent Agreement." Therefore, without any newly discovered *693 material evidence, the Court finds that there was no manifest error of law or facts regarding the Court's June 11, 2009 judgment in favor of Muscarello and against Debtors on Count IV of the adversary complaint in the amount of $385,638.04, including $300,453.04 from the "Ten Percent Agreement."
Debtors next request that the Court reconsider the liability of debtor Victoria Blackburn. Victoria Blackburn was employed by ECRM from January 2002 and until December 31, 2006. (Victoria Test., Tr. 3/12/09, 134-35.) When Beacon was formed in January 2007, Victoria, as a Beacon officer and 50% Beacon owner, worked at Beacon until October 2007. (Victoria Test., Tr. 3/12/09, 136, 142.) By December 11, 2006, Richard Blackburn told ECRM clients that he was going to close ECRM, open Beacon and continue to service ECRM's business clients through Beacon. (Victoria Test., Tr. 3/12/09, 143.) At the time, Victoria was aware that ECRM owed money to Muscarello and knew the general details regarding the "Ten Percent Agreement." (Victoria Test., Tr. 3/12/09, 138-39.) Moreover, Victoria typed notifications to ECRM's clients indicating that ECRM was closing and that their business was transferring to Beacon. (Victoria Test., Tr. 3/12/09, 140-42.) On December 14, 2006, a board of directors meeting for ECRM took place with Victoria in attendance, but Muscarello, who was not informed, did not attend and, more importantly, Victoria made no attempts to contact Muscarello to either inform him about ECRM's board of directors' meeting, ECRM's closing, or Beacon's formation. (Victoria Test., Tr. 3/12/09, 140.) As of December 14, 2006, Victoria testified that she had made a determination that Beacon was going to be a new business and Muscarello was not going to be a part of it. (Victoria Test., Tr. 3/12/09, 143.) Thus, Victoria and Richard Blackburn intentionally diverted the majority of ECRM's business to Beacon, since Beacon was not conditioned under the "Ten Percent Agreement." (Opinion, June 11, 2009, 19; Victoria Test., Tr. 3/12/09, 143.) Regarding ECRM's dissolution, Victoria and Richard Blackburn submitted a materially false Articles of Dissolution to the Illinois Secretary of State that indicated that the shareholders had approved the dissolutions, despite the fact that the majority of the shareholders had not approved this action. (Opinion, June 11, 2009, 10, 19; PL's Ex. 46).
Thus, without any newly discovered material evidence, there is ample support for the proposition that there was no manifest error of law or facts regarding the liability of Victoria Blackburn.
In ruling on professional fees as an administrative expense claim, Debtors request that the Court specify the specific amounts that Debtors sought in their fee petition. Prior to Debtors' conversion from Chapter 13 to Chapter 7, Debtors' attorneys, Myler, Ruddy & McTavish, and Debtors' valuation expert, James D. Keith, sought compensation for post-petition services in their representation of Debtors in their adversary trial and priority cost of administrative claim, pursuant to 11 U.S.C. §§ 330, 503, 507. Keith's application for compensation, dated May 11, 2009, sought $6760.00 in fees and $142.90 in expenses. Debtors' counsel's application for compensation, dated May 11, 2009, sought $18765.00 in fees and $2535.89 in expenses.
Section 329(b) of the Bankruptcy Code effectively allows the Court to determine whether the fees charged by the debtor's attorney are excessive and, if so, the Court may cancel any compensation agreement between the attorney and the client. See In re Mortakis, 405 B.R. at 297 (Bankr. N.D.Ill.2009) (citing In re Wiredyne, Inc., *694 3 F.3d 1125, 1127 (7th Cir.1993)). Section 329(a) requires a debtor's attorney to "file with the court a statement of the compensation paid or agreed to be paid ... and the source of such compensation." Id. (quoting 11 U.S.C. § 329(a)). Bankruptcy courts have wide discretion to determine reasonable compensation for actual and necessary services. In re Wildman, 72 B.R. 700, 705 (Bankr.N.D.Ill.1987).
Section 330(a)(1) provides:
(a)(1) After notice to the parties in interest and the United States Trustee and a hearing, and subject to sections 326, 328, and 329, the court may award to ... a professional person employed under section 327 or 1103
(A) reasonable compensation for actual, necessary services rendered by the... professional person, or attorney and by any paraprofessional person employed by any such person; and
(B) reimbursement for actual, necessary expenses.
11 U.S.C. § 330(a) (2006). Thus, pursuant to 11 U.S.C. § 330(a)(3), courts should consider six factors to determine whether or not to award attorney fees. Section 330 states, in relevant part:
(a)(3) In determining the amount of reasonable compensation to be awarded to... [a] professional person, the court shall consider the nature, the extent, and the value of such services, taking into account all relevant factors, including
(A) the time spent on such services;
(B) the rates charged for such services;
(C) whether the services were necessary to the administration of, or beneficial at the time at which the service was rendered toward the completion of, a case under this title;
(D) whether the services were performed within a reasonable amount of time commensurate with the complexity, importance, and nature of the problem, issue, or task addressed;
(E) with respect to a professional person, whether the person is board certified or otherwise has demonstrated skill and experience in the bankruptcy field; and
(F) whether the compensation is reasonable based on the customary compensation charged by comparably skilled practitioners in cases other than cases under this title.
11 U.S.C. § 330(a)(3)(A)-(F). The plain language of § 330(a)(4)(B) allows compensation for services that benefit the debtor. In re Lee, 209 B.R. 708, 710 (Bankr. N.D.Ill.1997). It also allows the court to consider the six factors in § 330(a)(3).
"Once a question has been raised about the reasonableness of the attorney's fee under [§ ] 329, it is the attorney himself who bears the burden of establishing that the fee is reasonable." In re Geraci, 138 F.3d 314, 318 (7th Cir.1998); see also In re Wildman, supra, 72 B.R. 700, 708. The legislative history for § 329 states that "[p]ayments to a debtor's attorney provide serious potential for evasion of creditor protection provisions of the bankruptcy laws, and serious potential for overreaching by the debtor's attorney, and should be subject to careful scrutiny." In re Mortakis, 405 B.R. at 299-300 (Bankr. N.D.Ill.2009) (quoting H.R. REP. NO. 95-595, at 329 (1977), as reprinted in 1978 U.S.C.C.A.N. 5787, 6285) (emphasis supplied).
Section 329(a) requires a debtor's attorney to "file with the court a statement of the compensation paid or agreed to be paid... and the source of such compensation." 11 U.S.C. § 329(a). Fee disclosure under § 329 and the Rules is mandatory, not permissive. In re Mortakis, supra, 405 B.R. at 299-300 (citing In re Whaley, 282 *695 B.R. 38, 41 (Bankr.M.D.Fla.2002)). Failure to disclose is sanctionable and can include partial or total denial of compensation, as well as partial or total disgorgement of fees already paid. See In re Prod. Assocs., Ltd., 264 B.R. 180, 186, 189 (Bankr.N.D.Ill.2001).
Under the Federal Rules of Bankruptcy Procedure 2016, to establish actual and necessary services when an applicant files an application for compensation, an applicant shall submit a detailed statement of the services rendered, time expended and expenses incurred as well as the amounts requested. In re Wildman, supra, 72 B.R. at 707 (citing Fed. R. Bankr.P. 2016). The detailed statement establishes the "actual" requirement, while an accompanying narrative explanation of the "how" and "why" establishes the "necessary" requirement. Id.
In addition, Local Bankruptcy Rule 5082-2 and General Order 07-02 identify the requirements for the contents of an application for compensation made by a professional, including a debtor's attorney, under a Chapter 13 case. Bankr.N.D. Ill. R. 5082-2; Bankr.N.D. Ill. Gen. Order 07-02. If a debtor's counsel and debtor enter into a Model Retention Agreement, then counsel may apply for a flat fee not to exceed $3500. Bankr.N.D. Ill. R. 5082-2. If the debtor's counsel and debtor have not entered into a Model Retention Agreement, then counsel must include a completed form itemization with the fee application. Id.
Section 503 of the Bankruptcy Code provides for the "allowance" of administrative expenses and derives its importance from section 507. 4 COLLIER, ¶ 503.01. Section 507 provides that certain categories of expenses and claims have priority in the distribution of the assets of the estate. Id. Specifically, section 507(a)(2) sets forth second priority for administrative expenses allowed under section 503(b). Id. Thus, section 503(b)(2) provides:
(b) After notice and a hearing, there shall be allowed administrative expenses, other than claims allowed under section 502(f) of this title, including
. . . .
(2) compensation and reimbursement awarded under section 330(a) of this title[.]
11 U.S.C. § 503(b)(2). Section 507(a)(2) then provides:
(a) The following expenses and claims have priority in the following order:
. . . .
(2) Second, administrative expenses allowed under section 503(b) of this title, and any fees and charges assessed against the estate under chapter 123 of title 28.
11 U.S.C. § 507(a)(2) (2006).
In a Chapter 13 case, section 330(a)(4)(B) provides that the court may allow reasonable compensation to the debtor's attorney for representing the interests of the debtor in connection with the bankruptcy case. 11 U.S.C. § 330(a)(4)(B); see also In re Met-L-Wood Corp., 103 B.R. 972, 975 (Bankr.N.D.Ill.1989). In addition, section 331, in conjunction with Bankruptcy Rule 2016, allows any professional person employed pursuant to § 327 or § 1103 of the Code, to apply to the court for interim compensation and reimbursement. In re Met-L-Wood Corp., 103 B.R. at 975-76 (citing 11 U.S.C. § 331). Moreover, the allowance of a claim for reasonable compensation to the debtor's attorney is an administrative expense, entitled to priority distribution under 11 U.S.C. § 507. See id. at 976. To determine whether to approve an interim compensation application, the court must weigh important competing interests. Id. For instance, the primary policy behind the awarding of interim compensation *696 under § 331 is to relieve attorneys from the burden of financing lengthy and complex bankruptcy proceedings. Id. (citing In re UNR Indus., Inc., 72 B.R. 796, 798-99 (N.D.Ill.1987) (Chapter 11)). On the other hand, the court must also weigh the interests of preserving the estate and protecting its various classes of creditors. Id. (citing In re Tri-County Water Ass'n, Inc., 91 B.R. 547, 549 (D.S.D. 1988)). It is well-settled that a debtor's attorney is not entitled to compensation from the estate unless his services benefitted the estate. Id. (citing In re Ryan, 82 B.R. 929 (N.D.Ill.1987)).
Debtor's attorneys and valuation experts defended Debtors in a four-day adversary trial that represented one of the largest claims in Debtors' estate. The Court, sua sponte, determines that Debtors' counsel's and valuation expert's request for administrative priority on their individual applications for compensation requires the requisite notice and hearing, pursuant to 11 U.S.C. § 503(b)(2). Thus, the Court's June 11, 2009 order granting administrative expense claim priority to these applications shall be vacated. In light of the Chapter 7 trustee's July 25, 2009 no asset report, there may not be any assets to distribute for these professional fees. Regardless, the Court will notice the parties-in-interest and set both professional fee applications for hearing on September 18, 2009.
CONCLUSION
For the foregoing reasons, upon reconsideration of the Court's June 11, 2009 order and memorandum the Court sustains Plaintiffs' objections to discharge under § 523(a)(6) in Count IV, and overrules Plaintiffs' objections to discharge under § 523(a)(6) in Count I. Plaintiffs' compensatory damages remain $385,638.04. Debtors' request to reconsider the liability of Victoria Blackburn is denied.
In addition, the Court's June 11, 2009 order granting administrative expense claim priority to Debtors' counsel's and valuation expert's applications for compensation shall be vacated. Debtors' counsel's and valuation expert's request for administrative priority on their individual applications for compensation requires the requisite notice and hearing, pursuant to 11 U.S.C. § 503(b)(2). Accordingly, the Court will notice the parties-in-interest and set both professional fee applications for hearing on September 18, 2009.
THEREFORE, IT IS ORDERED that the foregoing constitutes findings of fact and conclusions of law as required by Fed. R.Civ.P. 52(a) and Fed. R. Bankr.P. 7052. A separate order shall be entered pursuant to Fed. R. Bankr.P. 9021 giving effect to the determinations reached herein.
NOTES
[1] This includes: (1) monies owed to Muscarello under the "Ten Percent Agreement" Agreement at $73,171.00 or 10% of 2002 gross revenue for ECRM, which equaled $731,706.00, subtracted by (2) monies paid to Muscarello's wife, Trish, for salary at ($21,922.96) and (3) health insurance premiums paid for the Muscarello's at ($20,752.00), which ultimately totaled 530,496.04 owed to Muscarello in 2002. (Pl.'s Ex. 13)
[2] This includes: (1) monies owed to Muscarello under the "Ten Percent Agreement" at $85,088.10 or 10% of 2003 gross revenues for ECRM, which equaled $850,881.00, subtracted by (2) monies paid to Muscarello's wife, Trish, for salary at ($8,076.88), (3) health insurance premiums paid for the Muscarello's at ($12,786.00), and (4) Muscarello's AT & T wireless cell phone service at ($500.64), which ultimately totaled $63,724.58 owed to Muscarello in 2003. (Pl.'s Ex 11) The Court notes that there is an additional $8010.86 ($71,735.44-$63,724.58) on the 2003 Schedule L (loans to shareholders) when compared to the amount listed pursuant to the "Ten Percent Agreement" after monies were paid for various Muscarello expenses and salary.
[3] The 2004, 2005 and 2006 ECRM tax returns prepared by Motl reflect a shareholder loan on Schedule L, Line 19loans from shareholders outstanding end of the year amounts still due shareholder (Blackburn) as $3111 and Muscarello as $16,000. (Pl.'s Exs. 7-9)
[4] Motl prepared ECRM's 2004 through 2006 tax returns, but Blackburn did not fully inform Motl of the "Ten Percent Agreement," and, thus, these tax returns may not reflect the entire extent of the shareholder loan relating to the "Ten Percent Agreement." (Motl Test., Tr. 3/10/09, 176-78)
[5] See supra, n. 3.
[6] See supra, n. 4.
[7] See supra, n. 3.
[8] See supra, n. 4.
[9] Based on Krol's report findings, payroll taxes ($15,984) were 8.19% of salaries ($101,653-officers; $93,553-general) in 2005 and 7.85% ($20,561) of salaries ($101,208-officers; $160,576-general) in 2006. Similarly, under Krol's normalized findings, payroll taxes ($9535) were 8.42% of salaries ($50,000-officers; $63,280-general) in 2005 and 7.85% ($14,339) of salaries ($50,000-officers; $132,747-general) in 2006. The average rate of payroll taxes was 8.3% in 2005 and 7.85% in 2006. Under the Court's adjustments, 2005 payroll taxes at 8.3% of salaries ($50,000-officers; $93,553-general) equals $11,919, while 2006 payroll taxes a 7.85% of salaries ($50,000-officers; $160,576-general) equals $16,531.
[10] After adjusting the 2005 entries for salaries: officers from $101,653 to $50,000 and for payroll taxes from $15,984 to $11,919, ECRM's 2005 net income equaled $78,181. Similarly, after adjusting the 2006 entries for salaries: officers from $101,208 to $50,000 and for payroll taxes from $20,561 to $16,531, ECRM's 2006 net income equaled $49,596. Thus, ECRM's net income average for 2005 and 2006 ($49,596; $78,181) equaled $63,889. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534183/ | 121 N.H. 19 (1981)
THE STATE OF NEW HAMPSHIRE
v.
ROGER M.
No. 80-007.
Supreme Court of New Hampshire.
January 28, 1981.
R. John Roy, of Manchester, by brief and orally, for the defendant.
Gregory H. Smith, acting attorney general (Richard C. Nelson, assistant attorney general, on the brief and Peter W. Mosseau, attorney, orally), for the State.
BROCK, J.
The sole issue presented on appeal is whether RSA 651:5 allows the superior court to annul the record of conviction of a defendant who was over the age of twenty-one at the time of the offense and whose sentence included a fine and a suspension of license, in addition to a one-year conditional discharge. The Superior Court (Souter, J.) ruled that the statute does not provide for the annulment of a record of conviction under these circumstances. For the reasons which follow, we reverse.
On January 26, 1978, the defendant, Roger M., was arrested and charged with operating a motor vehicle under the influence of intoxicating liquor. (RSA 262-A:62.) In accordance with Rule 2.14 of the District and Municipal Court Rules, the defendant waived presentation of evidence by the State, entered a plea of not guilty *20 and was found guilty. The defendant appealed to the superior court. In November 1978, after plea negotiations between his counsel and the county attorney, the defendant entered a plea of guilty. The Superior Court (Contas, J.) followed the recommendation agreed upon by the prosecutor and defense counsel and imposed the following sentence: $150 fine with $100 suspended; $5 penalty assessment; sixty days suspension of operator's license; and one year conditional discharge.
In September 1979, the defendant filed a petition in the superior court to annul his record of conviction and sentence, under RSA 651:5 I. On December 13, 1979, the Superior Court (Souter, J.) dismissed the petition, ruling that RSA 651:5 does not provide for annulment of a record of conviction when the sentence of a defendant, who is over the age of twenty-one at the time of the offense, includes both a fine and a conditional discharge. Defendant's motion for rehearing was denied and defendant appealed to this court.
RSA 651:5 authorizes the original sentencing court to annul records of criminal convictions and sentences under certain circumstances. See generally Gough, The Expungement of Adjudication Records of Juvenile and Adult Offenders: A Problem of Status, 1966 WASH. U.L.Q. 147, 162-68; Comment, Application of New Hampshire's Criminal Annulment Statute, N.H. Rev. Stat. Ann. 651:5: Doe v. State, 17 N.H.B.J. 92 (1975).
RSA 651:5 I provides that "a person who has been sentenced to probation or conditional discharge" and "has complied with the conditions of his sentence" may have the record of his conviction annulled at the termination of his sentence.
The State argues, however, that the defendant cannot rely on RSA 651:5 I because Doe v. State, 114 N.H. 714, 716, 328 A.2d 784, 786 (1974), stands for the proposition that persons who are ordered to pay a fine as part of their sentence are not entitled to an annulment of their record. Dictum in Doe v. State, supra at 716, 328 A.2d at 786, lends some support to this argument. However, the defendant in that case was not sentenced to a conditional discharge but was ordered only to pay a fine. The State correctly asserts that a fine is not probation or a conditional discharge, but overlooks the fact that the defendant here was nevertheless given a conditional discharge as part of his sentence. Therefore, the question which remains is whether the imposition of a fine in addition to a conditional discharge prevents annulment.
RSA 651:5 I grants authority to annul the record of conviction whenever the sentence includes probation or conditional discharge. *21 It does not provide that a fine cannot be a part of the sentence. If that had been the intent, the statute would have read "when a person who has been sentenced only to probation or conditional discharge...."
The fact that subsection III provides for annulment when imprisonment is part of the sentence only when the defendant is a minor would prevent an annulment under subsection I when probation is combined with imprisonment for an adult.
The fact that Doe v. State, 114 N.H. 714, 328 A.2d 784 (1974), was unnecessarily decided under subsection III does not militate against the result reached here.
The State claims that in order to rely on RSA 651:5 I, a defendant must receive only probation or a conditional discharge. In support of this argument, it relies on State v. Doe, 117 N.H. 259, 372 A.2d 279 (1977). In that case we held that a person who has been sentenced to both a term of imprisonment and probation does not qualify for an annulment of his record under the statute. That holding, however, was not reached because RSA 651:5 I required such a result, but because we considered RSA 651:5 III the exclusive statutory means of having a record of conviction annulled where a defendant had been sentenced to a term of imprisonment. State v. Doe, 117 N.H. 259, 260-61, 372 A.2d 279, 280-81 (1977). RSA 651:5, however, makes no specific reference to persons who have only been fined and given a conditional discharge.
[1-3] Similarly, RSA 651:5 III does not expressly provide that a person under the age of twenty-one who is ordered to pay a fine, rather than serve a prison term, can petition to have his record annulled. When that situation came before us, we considered the legislative purpose and intent of the statute and concluded that "it would clearly do violence to the intent of this statute to deny its benefits to defendants . . . who committed one foolish misdemeanor because the judge sentenced him to a small fine rather than the harsh sentence of imprisonment." Doe v. State, 114 N.H. 714, 718, 328 A.2d 784, 786-87 (1974). In this case, the defendant was ordered to pay a small fine and was not placed on probation. It would be illogical to conclude that defendants whom the court finds it necessary to give a term of probation may have their records annulled while those who receive only a fine may not, where the trial court expressly included the phrase "conditional discharge" in their sentence. "No sound reason of policy or otherwise for such unfair discrimination is advanced, and none is perceived. It has long been settled here that our court will not *22 interpret a statute so as to produce an injust and seemingly illogical result." Doe v. State, 114 N.H. 714, 717, 328 A.2d 784, 786 (1974), quoting General Electric Co. v. Dole Company, 105 N.H. 477, 479, 292 A.2d 486, 488 (1964). RSA 625:3 requires that the criminal code be construed liberally "to promote justice."
Accordingly, we remand this case to the superior court for it to consider the defendant's petition on the merits.
Reversed and remanded.
BOIS, J., and KING, J., dissented; the others concurred.
BOIS, J., dissenting:
The defendant, to be entitled to an annulment of his record of conviction, necessarily must satisfy the requirements of RSA 651:5 I which deals with a sentence of probation or conditional discharge. He argues that because the trial court included a conditional discharge as one element of his sentence the annulment provisions of RSA 651:5 are applicable to him. I disagree.
In State v. Doe, 117 N.H. 259, 372 A.2d 279 (1977), this court rejected a similar argument of a defendant (over twenty-one years of age) who was sentenced to imprisonment and on his release to probation for one year.
We held therein that RSA 651:5 I was not applicable because the sentence contained both imprisonment and probation. We further held that "[i]t is too well established to require elaboration that where a purely statutory remedy, such as in this case, is concerned, courts can neither ignore the plain language of the legislation nor add words which the lawmakers did not see fit to include." 117 N.H. at 261, 372 A.2d at 280; see 2A C. SANDS, SUTHERLAND STATUTORY CONSTRUCTION § 46.01 (4th ed. 1973).
Although Senator Nixon included the term "fine" as a type of punishment subject to annulment in a speech urging the State Senate to adopt the statute, N.H.S. JOUR. 1643 (1971); see Doe v. State, 114 N.H. 714, 717, 328 A.2d 784, 786 (1974); the text of RSA 651:5, which the legislature eventually enacted, does not include the word "fine" within any of the categories which provide for an application for the annulment of a record of conviction.
The plain meaning of RSA 651:5 I and II does not provide for an application for annulment of a record of conviction when a court has imposed a fine as part of the sentence, and therefore, I would hold that the defendant herein cannot avail himself of the statute's application.
KING, J., concurs in the dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534187/ | 468 S.W.2d 435 (1971)
Leslie Dean DeHART, Jr., Appellant,
v.
The STATE of Texas, Appellee.
No. 43943.
Court of Civil Appeals of Texas.
June 29, 1971.
*436 Kenneth D. DeHart, Houston, for appellant.
Carol S. Vance, Dist. Atty., Phyllis Bell and Ted Busch, Asst. Dist. Attys., Lubbock, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ODOM, Judge.
This appeal is from a conviction for the offense of murder with malice aforethought; the punishment was assessed by the jury at 99 years in the Department of Corrections.
The sufficiency of the evidence is not challenged.
Leslie Dean DeHart, Sr., father of appellant, died as the result of a gun shot wound inflicted to his face and neck at his home in Houston on November 10, 1969.
William Francis testified that at approximately 5:00 to 5:30 P.M. on November 10, 1969, appellant came to his house and asked to borrow his .22 magnum pistol. He loaned appellant his pistol and some .22 magnum bullets. He later identified the pistol which was recovered from appellant at the time of his arrest as being the same one he had loaned to appellant earlier that day. Norma Jean DeHart, appellant's ex-wife, testified that between 6:00 and 7:00 P.M. on November 10, 1969, she received a telephone call from appellant. As to her conversation with appellant she testified as follows:
"He told me he had shot his daddy and killed him. I didn't believe him. I kept on telling him that I didn't believe. I asked him what was the matter with him, because he was real upset. He kept saying over and over that he shot his daddy, that he killed his daddy. I got him to calm down a little bit. Then he told me that he shot his daddy over at his mother's. He didn't know where he was. He left. That is all he would say."
Charles Kent, an arson investigator with the Houston. Fire Department, testified that sometime around 8:30 P.M. on November 10, 1969, he learned about the shooting of the deceased and received a description of the automobile appellant was driving. Sometime later, Kent spotted appellant's automobile and followed it until appellant turned around and pulled up beside Kent's vehicle and asked what the "G___ d___ h___" Kent wanted. Kent replied that he was a police officer and wanted to see appellant's driver's license. Appellant replied "h___," put his car in gear and took off at a high rate of speed. Kent chased appellant's automobile at speeds up to 80 miles per hour until appellant abandoned the car in a yard near a railroad track.
Officer W. E. Reed, of the Houston Police Department, testified that after talking to Houston arson investigators at the place where appellant had abandoned his automobile, he put out a broadcast over his two-way police radio that appellant was armed and last seen going down a railroad track toward Enid Street.
Officer S. M. Nuchia, of the Houston Police Department, made the initial investigation of the shooting. Approximately three hours after his initial investigation, he went to a residence on Enid Street approximately ten miles from the scene, and knocked on the door, which appellant opened. Apparently, appellant had been *437 taking a shower, since he was nude although he had a towel in his right hand and a pistol in his left hand. Nuchia pointed a 12-gauge shotgun at appellant, told him he was under arrest, to put his hands up, and to drop the gun. The pistol, a six shot .22 magnum, was loaded with five live bullets and one empty shell. Appellant dropped the pistol and asked if he could get dressed. Officer Nuchia accompanied appellant to a bedroom and asked him if he realized that his father was dead, whereupon appellant replied: "Yes, I know. I only wish it had been my mother."
The sole ground of error relates to the trial court's admission of appellant's oral statement to Officer Nuchia that he knew his father was dead and wished it had been his mother, on the ground that such statement was hearsay. The following is reflected from the record:
"Q. What did you do after you picked up the pistol that the Defendant had dropped out there?
"A. I had already told the Defendant that he was under arrest. He asked if I would let him get dressed first. I told him I would. We then walked into the bedroom which was adjoining the hallway that the front door was connected to.
"Q. All right. At that time did you say anything to the Defendant?
"A. I asked the Defendant if he realized that his daddyas I called himwas dead.
"Q. Did you have any response?
"A. Yes, sir.
"MR. DE HART (Defense Council): We object. It is hearsay.
"THE COURT: Overruled.
"Q. (By Prosecutor) You may answer what his response was to your statement.
"A. (By Witness) He said, `Yes, I know. I only wish it had been my mother.'"
On cross-examination, the following testimony was elicited:
"Q. Are you sure about the statements he made concerning the matter? Are you sure those were his exact words?
"A. Yes, sir.
"Q. Do you recall that from the scene?
"A. Yes, sir. I do.
"Q. Did you place that in your report?
"A. Yes, sir. I did.
"Q. Are you sure that statement was made in the bedroom?
"A. Yes, sir. I am certain.
"Q. Did you or the other officer ask him if he wished to shoot his mother?
"A. No, we didn't. All I said, `You know your daddy is dead, don't you?'
"Q. You didn't phrase that statement for his response?
"A. No sir. Not at all."
In view of the fact that the statement was made immediately after arrest and was a spontaneous, non-responsive answer to Officer Nuchia's question, it was res gestae of the arrest. Art. 38.22, Sec. 1(f) Vernon's Ann.C.C.P. Tilley v. State, Tex.Cr. App., 462 S.W.2d 594; Wright v. State, Tex.Cr.App., 440 S.W.2d 646; Moore v. State, Tex.Cr.App., 440 S.W.2d 643.
There being no reversible error, the judgment is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534196/ | 415 B.R. 529 (2009)
In re Judy Clariece COOK, Debtor.
No. 09-10064.
United States Bankruptcy Court, D. Kansas.
September 10, 2009.
*530 Michael J. Studtmann, Wichita, KS, for Debtor.
ORDER REGARDING VALUATION
ROBERT E. NUGENT, Chief Judge.
Creditor GMAC objected to confirmation of Debtor Judy Clariece Cook's Chapter 13 Plan for failing to comply with the requirements of 11 U.S.C. § 1325(a)(5)(B)(ii) because it undervalued GMAC's claim, which is secured by Debtor's 2006 Saturn Vue ("the Vehicle").[1] The Court confirmed Debtor's Plan subject to the allowance of GMAC's secured claim.[2]
The Court conducted a valuation hearing on August 19, 2009.[3] Debtor appeared in *531 person and by counsel Michael Studtmann. GMAC appeared by Nelson Mitten and Creath Pollack. The Chapter 13 trustee, Laurie B. Williams, appeared in person. Debtor and the parties' respective auto appraisers testified. The parties stipulated Debtor's Exhibits 1-4 and GMAC's Exhibits 1-5 into evidence. At the hearing, the parties urged different valuation benchmarks under § 506(a)(2). GMAC maintained that the proper valuation was as of the date of petition and that its collateral should be valued at retail without regard for any costs of sale or reconditioning. Debtor maintained that the proper valuation was as of the hearing date that value is determined and that various repair and reconditioning costs should be deducted from retail value.
A. Factual Background
Debtor filed her voluntary Chapter 13 petition and Chapter 13 Plan on January 14, 2009. In her Plan, Debtor proposed to pay GMAC $9,280.00 on its claim of $15,829.00. The Plan provided for monthly payments of $284.42 to GMAC. Both parties presented the testimony of automobile sellers in support of their value contentions. The Court was generally impressed with the abilities of both experts and found their presentations helpful and credible.
Debtor's expert, Alan Rupp, inspected and appraised the Vehicle on August 13, 2009, when it had approximately 76,830 miles on it. Mr. Rupp testified that the Vehicle's NADA retail value, as of the date of his appraisal, is $12,800 after reconditioning and its NADA trade-in value is $9,400 after reconditioning.[4] He estimated that it would cost approximately $1,425 to recondition the vehicle: $200 to repair paint chips, $275 to repair scrape on rear bumper, $125 to remove interior stains, $250 to fix windshield chips/stars, $450 for inspection and fluid changes, and $125 for detailing. He appraised the Vehicle's net retail value at $11,375 and its net trade-in value at $7,975.[5] Mr. Rupp did not know what the NADA values were in January of 2009, the petition date.
GMAC's expert, Alan Moore, inspected the Vehicle on May 17, 2009 when it had 76,319 miles on it. He noted the Vehicle has a couple of paint scuffs and was a little dirty but these problems could be fixed for less than $180. He did not note any defects in the windshield. He described the Vehicle as being in good condition overall. Mr. Moore's report indicates that the Vehicle's NADA "Clean Retail" value in May 2009 is $12,400. He added another $600 to the Vehicle's value due to the high demand for used cars in this economy, the popularity of the Vehicle's make and model, special features (sunroof, Honda engine, etc.), gas mileage, and its overall condition. Mr. Moore concluded that the Vehicle's retail value in May 2009 was $13,000 plus the value of the balance of the extended service contract. He testified that the difference in NADA value from January to May, 2009 was a decrease of $1,200, making the Vehicle's retail value in January 2009 $14,200 plus the value of the remaining extended service contract. Mr. Moore also testified that comparable vehicles would sell for $13,900 to $16,900, but that he had been pressed to find a similar vehicle in the multi-state area.
Mr. Moore assumed that the Vehicle had approximately 60,000 miles on it in January 2009 as this was the figure Debtor had reported in her schedules. At the hearing, Debtor testified that she recently discovered *532 that the mileage in the Vehicle in January was higher than she had previously reported and that it was closer to 69,000 miles.[6] She also testified that this is her personal vehicle and uses it to go to and from work, shopping, and other places. She testified that Saturn East of Wichita advised they would trade in the Vehicle for $7,500 to $8,000 and sell it for $11,800.[7]
B. Analysis
Section 1325(a)(5) specifies that the holder of an allowed secured claim must receive, as of the effective date of the plan, an amount that is not less than the amount of its allowed secured claim. Unless the security in question is a purchase money car acquired within 910 days of the filing date, determining the value of the collateral securing the claim is governed by § 506. That section generally provides that an allowed secured claim is allowed to the extent of the value of the collateral and that the value shall be determined in light of the purpose of the valuation and the proposed disposition or use of the property. BAPCPA added § 506(a)(2) which provides as follows:
If the debtor is an individual in a case under chapter 7 or 13, such value with respect to personal property securing an allowed claim shall be determined based on the replacement value of such property as of the date of the filing of the petition without deduction for costs of sale or marketing. With respect to property acquired for personal, family, or household purposes, replacement value shall mean the price a retail merchant would charge for property of that kind considering the age and condition of the property at the time value is determined. (Emphasis added).
The language of this subsection, specific to chapter 7 and 13 cases, raises two issues that directly bear on the disposition of this and many other like cases. First, the Court must determine as of what date the property is to be valued. Second, if the property is used for personal, family, or household purposes, the Court must decide how to adjust the retail merchant price considering the age and condition of the property.
The debtor argues that since she uses the Vehicle for personal needs, the second sentence controls and that the Vehicle's value should be determined as of the date of the valuation hearing as set out in Judge Berger's decision in In re Feagans.[8] GMAC argues that the collateral should be valued as of the date of the filing of the petition notwithstanding the verbiage contained in the second sentence. The parties also differ as to what factors drive the value of the Vehicle.
This Court has not had an opportunity to consider the temporal provisions of § 506(a)(2). Before BAPCPA, courts disagreed on the date for fixing the value of collateral in Chapter 13 cases.[9] Some courts held that the value of collateral for Chapter 13 plan confirmation purposes should be determined as of the date of the petition because the amount of the creditor's claim is fixed at the date of the *533 petition by § 502.[10] Other courts fixed the value of collateral at some later date, some using the date of confirmation, others the date that proceedings to determine value are initiated, and several at the date of the valuation hearing.[11] Yet other courts relied on the phrase "effective date of the plan" in § 1325(a)(5)(B)(ii) to value property as of the effective date. With respect to chapter 7 and 13 cases, BAPCPA changed all that with the addition of § 506(a)(2).
Section 506(a)(2) appears to contain two temporal benchmarks. Personal property that was not acquired for personal, family or household purposes is to be valued "as of the date of the filing of the petition." In the second sentence of the subsection, however, property acquired for personal, family or household purposes is to be valued "at the time value is determined." Feagans concluded that personal use collateral is valued as of the time of the hearing while other personal property should be valued as of the petition date. One other court has held to the contrary. In In re Morales, the court held that the second sentence of § 506(a)(2) requires retail value to be determined as of the petition date, stating:
... a full view of the interaction between the first and second sentences of § 506(a)(2) favors valuation as of the petition date. By its own terms, the second sentence only establishes a specific definition of the general term "replacement value" to be used for certain property. The second sentence thus functions to provide a definition for a single term in the first sentence. * * * This definition does not alter the requirement that courts not deduct for costs of sale or marketing, nor should it alter the valuation date established in the first sentence.[12]
The Morales court stated that this approach establishes a single, static date of valuation for all personal property in individual Chapter 7 and Chapter 13 cases and generally encourages the parties to determine value as promptly as possible.[13]
This Court respectfully disagrees with Morales and concludes that the valuation of the Vehicle should be "as of the time value is determined." To hold otherwise would require the Court to ignore Congress' differing choice of words in the two sentences and render the last few words of the second sentence of § 506(a)(2) superfluous. In addition, it is difficult for the Court to consider the "age and condition" of the property as of the filing date at a later valuation hearing. As Judge Lundin writes in his treatise:
Logically, if the drafters intended property acquired for personal, family or household purposes to be valued at the petition, they would have used the same language in the second sentence as in the first sentence of new § 506(a)(2), or said nothing at all about timing in the *534 second sentence. A convincing argument emerges that property acquired for personal, family or household purposes is valued as of whatever time value is determined and all other personal property is valued at the petition.[14]
The Court notes that this view accords with that expressed in Collier and by other courts.[15]
Having determined the appropriate valuation date for the Vehicle, the Court turns to the requisite method of valuation. In 1997, the Supreme Court set the standard for valuing property retained by debtors in Associates Commercial Corp. v. Rash.[16] In Rash, the Supreme Court determined that, under § 506(a), the value of property retained when the debtor attempts to "cram-down" a creditor's claim in a chapter 13 case is the "cost the debtor would incur to obtain a like asset for the same proposed use" or "replacement value."[17] The Supreme Court did not mandate that replacement value was to be retail, wholesale value, or some other value. The bankruptcy courts were left to "ascertain[ ] replacement value based on the evidence presented" by considering the type of debtor and the nature of the property involved.[18] In footnote 6, the Rash court specifically noted that creditors should not receive "portions of the retail price, if any, that reflect the value of items the debtor does not receive when he retains his vehicle, items such as warranties, inventory storage, and reconditioning."[19]
Congress enacted § 506(a)(2) to codify Rash, incorporating the "replacement value" concept for chapter 7 and 13 cases, but modifying that concept as well. The first sentence of § 506(a)(2) directs that in chapter 7 and 13 cases involving personal property, replacement value is to be determined without regard to the cost of sale or marketing. Because reconditioning prepares the vehicle for sale, it is a cost of sale or marketing that may not be deducted. This departs from the Rash standard that allowed reduction of the value of collateral by subtracting the value of items that the debtor did not receive like warranties and reconditioning.
However, the second sentence of § 506(a)(2) defines the replacement value of any property that was acquired for personal, family, or household purposes, as "the price a retail merchant would charge for property of that kind considering the age and condition of the property at the time value is determined." The "age and condition" language suggests that the cost of reconditioning may be deducted from the merchant retail value of personal use property in order to account for depreciation and wear.[20]
*535 Here, both appraisers employed the NADA website to establish the retail and trade-in value of the Vehicle. "Clean Retail" is defined as
No mechanical defects and passes all necessary inspections with ease; Paint, body and wheels have minor surface scratching with a high gloss finish and shine; Interior reflects minimal soiling and wear, with all equipment in complete working order; Vehicle has a clean title history; Vehicle will need minimal reconditioning to be made ready for resale.[21]
It strikes the Court that NADA Clean Retail, as so defined, is in most cases the best starting point for valuing personal use vehicles under § 506(a)(2)'s second sentence. While the Court recognizes that some vehicles will be sufficiently unique (low mileage, rare or classic) to require in depth appraisal and evaluation, courts valuing most vehicles in chapter 7 and 13 cases could safely begin with this well-accepted and readily available source.[22] Therefore, the Court holds that, in this case, NADA Clean Retail, adjusted for needed mechanical, body, and interior repairs, as well as for other Rash items that the debtor does not receive (like reconditioning or detailing), is the best approximation of value for personal use vehicles subject to § 506(a)(2) treatment.[23]
Here, debtor's appraiser, Mr. Rupp, included a copy of the August 13, 2009 NADA Clean Retail and Clean Trade-in summaries with his report. Clean Retail was, after adjustment for mileage and accessories, $12,800. GMAC's appraiser, Mr. Moore, included a summary from May 12, 2009 that indicated clean retail at $12,400. Because both sentences of § 506(a)(2) refer to "replacement" or "retail," the Court disregards the trade-in or wholesale values. Although his report was generated later, Mr. Rupp's NADA retail value is higher. The Court notes that Rupp is affiliated with a dealer and that his summary is based on the "NADA Official Used Car Guide" for the "Midwest Used Car Guide, August, 2009." Mr. Moore's summary appears to be a print-out of "consumer values" from www. nadaguides.com and is not specific to region. The Court notes that, at the bottom of this print, NADA states, "the consumer values on nadaguides.com are based on the Consumer edition of the N.A.D.A. Official Used Car Guide®, and should not be utilized for industry purposes." No testimony explained the difference between prices reported in the consumer and dealer versions of the Guide. In any event, because the Court believes that the appropriate point in time for valuation in this case is as of the hearing date, it begins with the *536 August 13, 2009 clean retail price contained in Mr. Rupp's report.
Based on NADA's definition of "Clean Retail," the Court deducts the cost of services necessary to bring the car to a state of "no mechanical defects," "minor surface scratching" on the outside, "minimal soiling and wear" on the interior, and "all equipment in complete working order." Therefore, the Court deducts from Mr. Rupp's "clean retail" of $12,800 windshield repair of $250, interior stain removal of $125, and body paintwork of $475. The Court also deducts the inspection and fluid charge of $450 and the detail charge of $125. A debtor acquiring a like Vehicle with the noted defects would receive none of these items, each of which is the result of the vehicle's age and affects its condition. The Court therefore concludes that a retail merchant would charge $11,375 for a like vehicle that needed these repairs and reconditioning.
C. Conclusion
Accordingly, the Trustee is directed to determine whether the debtor's plan is rendered unfeasible by the result of this Order and, if it is, the Trustee shall move to set aside the confirmation order previously entered in this case. Alternatively, debtor shall be granted 10 days in which to present a modified plan that considers and treats GMAC's allowed secured claim in the amount set out above or provides for the vehicle's surrender to the creditor.
SO ORDERED.
NOTES
[1] Dkt. 17. All future references to "Section" or "§" refer to the Bankruptcy Code, Title 11 U.S.C. unless otherwise noted. The Vehicle is not a "hanging paragraph" 910-vehicle under § 1325(a)(9)(*).
[2] Order Confirming Chapter 13 Plan Subject to Valuation, Dkt. 31.
[3] This is a core proceeding over which this Court has jurisdiction pursuant to 28 U.S.C. §§ 157(b)(2)(B) and 1334.
[4] NADA refers to the National Automotive Dealers Association.
[5] Debtor's Ex. 2 (emphasis added).
[6] Debtor testified that she had located a receipt for the purchase of tires that recorded the mileage shortly after the beginning of the year 2009. This testimony was credible.
[7] Debtor's Ex. 4.
[8] Case No. 06-20049, slip op. (Bankr.D.Kan. Oct. 18, 2006) (Berger, J.) (Memorandum and Order Denying Confirmation of Chapter 13 Plan).
[9] 2 Keith M. Lundin, Chapter 13 Bankruptcy, 3d Ed. § 107.1 (2000 & Supp.2004) (collection of cases).
[10] Id.
[11] Id., see also Winston v. Chrysler Fin. Corp. (In re Winston), 236 B.R. 167, 171 (Bankr. E.D.Pa.1999) (crucial time at which the car must be evaluated is the date of confirmation of the plan); In re Jones, 219 B.R. 506, 508-09 (Bankr.N.D.Ill.1998) (date of confirmation is proper date for valuing car); Virginia Nat'l Bank v. Jones, 5 B.R. 736 (Bankr.E.D.Va. 1980) (collateral values fixed on the date that proceedings to determine value are initiated); In re Ibarra, 235 B.R. 204, 213 (Bankr. D.P.R. 1999) (determine present value as of the date of the hearing of confirmation); In re Arnette, 156 B.R. 366, 368 (Bankr.D.Conn.1993) (value should be determined as of the effective date of the plan); Blobaum v. Blobaum, 34 B.R. 962 (Bankr.W.D.Mo.1983) (same); In re Klein, 10 B.R. 657 (Bankr.E.D.N.Y.1981) (same).
[12] 387 B.R. 36, 47 (Bankr.C.D.Cal.2008).
[13] Id.
[14] 5 Lundin, supra note 9, § 450.1 at 450-4 (2000 & Supp.2007-1).
[15] 4 Collier on Bankruptcy ¶ 506.03[7][c], p. 506-76.1 (rev. 15th ed.2006) (explaining that for property governed by sentence 2 of § 506(a)(2), the date value is determined "will often be the date of confirmation") and In re Cheatham, 2007 WL 2428046, at *2 (Bankr. W.D.Mo. June 19, 2007) (using value as of hearing date and noting that courts must use "the value at the time the determination is being made").
[16] 520 U.S. 953, 963, 117 S. Ct. 1879, 138 L. Ed. 2d 148 (1997)
[17] Id. at 965, 117 S. Ct. 1879.
[18] Id., n. 6.
[19] Id.
[20] 5 Lundin, supra note 14, at 450-3 ("With respect to property acquired for personal, family, or household purposes, ... new § 506(a)(2) does not preclude adjustments for costs of sales or marketing."). See also Feagans at 5.
[21] See GMAC's Ex. 3, p. 3 (emphasis added).
[22] The Court notes that the Tenth Circuit Bankruptcy Appellate Panel has affirmed a bankruptcy court's use of another readily-available source, www.kbb.com, see Midwest Regional Credit Union v. De Anda-Ramirez (In re De Anda-Ramirez), 359 B.R. 794 (10th Cir. BAP 2007). In DeAnda, the court disdained the use of Kelly Blue Book "Retail," which assumes that the vehicle has been fully reconditioned and accounts for the dealer's cost of advertising and sale, does not account for the age and condition of a vehicle and is limited to vehicles in excellent condition. The court preferred KBB "Private Party" value, which is based on the age and condition of the vehicle and does not consider reconditioning cost. This Court expresses no opinion about the use of the KBB website for § 506 valuation purposes.
[23] None of this is to suggest that the Court will not entertain proposed valuations based on sources other than the NADA Guide. Counsel's use of a readily-available and recognized source of vehicle valuation may better serve the economies of most cases than the employment and presentation of expert reports and testimony. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534209/ | 468 S.W.2d 880 (1971)
STANDARD FIRE INSURANCE COMPANY, Appellant,
v.
Marcos M. CUELLAR, Appellee.
No. 14977.
Court of Civil Appeals of Texas, San Antonio.
June 16, 1971.
Rehearing Denied July 14, 1971.
*881 Michael M. Fulton, Beckmann, Stanard, Keene, Krenek & Fulton, San Antonio, for appellant.
Michael Rizik, Richard Tinsman, Tinsman & Houser, Inc., San Antonio, for appellee.
KLINGEMAN, Justice.
The Standard Fire Insurance Company has appealed from a judgment based upon a jury finding awarding Marcos M. Cuellar a recovery for total permanent disability in a workmen's compensation case. Except for the refusal to award a lump sum recovery, all issues were answered favorably to plaintiff.
Cuellar was an employee of Stowers Furniture Company, and part of his duties was that of a truck driver and driver's helper. On April 4, 1969, Cuellar and another employee of Stowers had delivered a load of furniture to Victoria in the course of their employment; and after making such delivery, were returning to San Antonio on a highway in a Stowers company truck, which was used for delivery of the furniture, with Cuellar driving. It was a warm day, and there is testimony that the truck did not have air conditioning, and that the window of the truck was down. As they were returning to San Antonio, Cuellar was allegedly stung by an insect on his upper lip, with swelling commencing almost immediately. By the time the truck returned to the Stowers warehouse in San Antonio, Cuellar's whole face had swollen considerably, and he had difficulty in seeing. That night he went to a doctor, who gave him a shot. Since that time he has been unable to carry on his duties as a workman at Stowers, and there is evidence that every time he attempted to do any work involving physical activity, his face and other parts of his body became badly swollen and he suffered considerable pain. He has undergone extensive medical treatment for over a year without any noticeable improvement. Although he has attempted to work, there is evidence that when he tries to do so, his face, wrists, arms, feet and other parts of his body swell. There is evidence that this condition is permanent.
The jury in answer to Special Issue No. 1 found that Cuellar sustained an injury on April 4, 1969, as a result of an insect sting. Appellant, by his first two points of error, contends that there is no evidence or insufficient evidence to sustain such finding.
*882 Cuellar testified that as he was driving the truck to San Antonio, he felt something sting him on the mouth; that he tried to grab it, but was not successful; that he never did see the insect; that it hurt him a lot; and that by the time he got back to the warehouse in San Antonio, his face was so swollen that he could hardly see. Cuellar's fellow worker, Mr. Gomez, testified that while Cuellar was driving he suddenly exclaimed that an insect had hit him on the lip, and that he felt some kind of sting on his upper lip; that he looked at Cuellar's upper lip at that time, and he noticed that it had swollen up and that it continued to swell up more and more all the time until they got back to San Antonio. He also testified that he never did see the insect. Dr. Strauch, a dermatologist, who treated Cuellar for over a year, testified that an insect sting was the cause of all of Cuellar's problems; and that in his opinion, based on reasonable medical certainty, all of Cuellar's symptoms are due to reactions and continued reactions to the single poisonous insect sting on April 4th; that every symptom which Cuellar stated he was suffering from, blurring of vision, pain in the hand, pain in the back and joints, swelling of the skin and lips, were compatible with a reaction that had continued as a result of the single episode of the insect sting.
The gist of appellant's contention in this regard seems to be that since no one saw the insect, there is no evidence or insufficient evidence that Cuellar sustained an insect sting.
We have reviewed that entire record, and we hold that there is ample evidence to sustain the jury's finding to Special Issue No. 1, and appellant's Points of Error Nos. 1 and 2 are overruled.
By five points of error appellant complains that the trial court erred in overruling its motion for judgment non obstante veredicto and motion for new trial, because the evidence was insufficient to support a finding of a causal relationship between appellee's employment and his alleged injury. The thrust of appellant's contentions is to the effect that the insect sting or bite did not have its origin in any causative danger prevailing in the conditions of appellee's employment, and that he was not exposed to any hazard to which he would not have been equally exposed apart from his employment; that the accident forming the basis of appellee's cause of action resulted from a danger to which mankind in general was equally exposed.
A similar contention was made and rejected in the only two Texas cases we have found involving an insect sting in a workmen's compensation case. Travelers Insurance Co. v. Williams, 378 S.W.2d 110 (Tex.Civ.App.Amarillo 1964, writ ref'd n.r.e.), and Indemnity Insurance Co. of North America v. Garsee, 54 S.W.2d 817 (Tex.Civ.App.Beaumont 1932, no writ), both involved injuries to an employee arising out of insect stings in a workmen's compensation case. In both of these cases, such injuries were held to be compensable. The argument was made in these cases, as in the case before us, that the insect stings sustained by the employees were a risk to which the general public was subject and not a risk or hazard of the employment. Such argument was rejected by the Court in both of these cases. In these cases an insect sting was held to be not an act of God.
The Court in Travelers Insurance Co. v. Williams, supra, stated: "Although it may be argued that anyone who happened to be in that particular area might be stung, the fact is the deceased was stung while in the performance of his duties of employment. He was subjected to this risk by carrying out his designated duties. We think it is clear the wasp sting was a risk or hazard of his employment and is compensable." (378 S.W.2d 110 at 113)
Appellant asserts and we agree that it is not alone sufficient to show that the claimant was injured while engaged in or about the furtherance of his employer's business, but he must also show that his *883 injury was of such kind and character as had to do with and originated in the employer's work, trade, business or profession. Aetna Life Insurance Co. v. Burnett, 283 S.W. 783 (Tex.Com.App.1926). The Supreme Court in a landmark case has laid down the rule that "[a]n injury has to do with, and arises out of, the work or business of the employer, when it results from a risk or hazard which is necessarily or ordinarily or reasonably inherent in or incident to the conduct of such work or business." Lumberman's Reciprocal Ass'n v. Behnken, 112 Tex. 103, 246 S.W. 72, 73 (1922). The Court then quoted with approval a statement of the Supreme Court of Iowa: "`What the law intends is to protect the employee against the risk or hazard taken in order to perform the master's tasks.'Pace v. Appanoose County, 184 Iowa, 498, 168 N.W. 918." See also Aetna Insurance Co. v. Hart, 315 S.W.2d 169 (Tex.Civ.App.Houston 1958, writ ref'd n.r.e.).[1]
The evidence establishes that the insect bite sustained by Cuellar resulted from the effort on his part to discharge in an orderly way the duties of his employment. He was stung while in the performance of his duties of employment, and he was subjected to this risk by carrying out his designated duties. We think it clear that the insect sting was a risk or hazard of his employment and is compensable. Appellant's Points of Error Nos. 3, 4, 5, 6, and 7 are overruled.
Appellant's last point of error is that the trial court erred in failing to submit appellant's requested Special Issue No. 1.[2] The trial court, intead of submitting such special issue requested by appellant, submitted the following issue: "Do you find, from a preponderance of the evidence, that such accidental injury, if any you have found, was sustained in the course of Marcos M. Cuellar's employment for Stowers Furniture Company?" The trial court correctly charged the jury in its definition of injury sustained in the course of employment with having to do with and originating in the work, business, trade or profession of the employer, and while the employee is engaged in or about the furtherance of the affairs or business of the employer, whether upon the employer's *884 premises or elsewhere. Article 8309, Section 1, Vernon's Annotated Civil Statutes.
Appellee asserts that such special issue requested by appellant was properly refused because the matter which it inquired about was a question of law and not a question of fact. He also asserts that such special issue was properly refused because there were no pleadings to support it.
The special issue submitted by the trial court, taken together with the court's charge, correctly submitted the proper issue to be decided by the jury, and the trial court properly refused to submit appellant's requested Special Issue No. 1. A similar point was passed upon in the case of Travelers Insurance Co. v. Williams, supra, where the Court said: "Being of the opinion the wasp bite was not an act of God, it was not error to refuse to submit an issue to the jury as to whether the deceased was exposed to a greater hazard in his employment than ordinarily applies to the general public." (378 S.W.2d 110 at 113)
In support of his contention that appellant's requested Special Issue No. 1 was not supported by the pleadings, appellee relies on the provisions of Rule 94, Texas Rules of Civil Procedure, which provide: "Where the suit is on an insurance contract which insures against certain general hazards, but contains other provisions limiting such general liability, the party suing on such contract shall never be required to allege that the loss was not due to a risk or cause coming within any of the exceptions specified in the contract, nor shall the insurer be allowed to raise such issue unless it shall specifically allege that the loss was due to a risk or cause coming within a particular exception to the general liability; * * *."
Appellant did not plead any exceptions to the general liability that exists under a workmen's compensation policy, and we doubt if appellant's pleadings are sufficient to raise its requested Special Issue No. 1. In any event, the trial court properly refused to submit such special issue, as hereinbefore discussed.
All of appellant's points of error are overruled. The judgment of the trial court is affirmed.
NOTES
[1] There are similar cases not involving insect stings where the argument has been made that the injury was not compensable because the accident forming the basis of the employee's cause of action resulted from a danger to which the public in general was equally exposed, and as such, was not a risk or hazard incident to the employment. In Travelers Insurance Co. v. Hampton, 414 S.W.2d 712 (Tex.Civ. App.Eastland 1967, writ ref'd n.r.e.), an employee was shot by an insane person as he was leaving his employer's store through the rear door. The Court held the death compensable under the workmen's compensation laws. In Vivier v. Lumbermen's Indemnity Exchange, 250 S.W. 417 (Tex.Com.App.1923), the Commission of Appeals held that where a night watchman, while on the employer's premises performing his duties, was assaulted and killed by unknown persons whose motive was robbery, his death was caused by an injury suffered in the course of his employment. In Southern Surety Co. v. Shook, 44 S.W.2d 425 (Tex.Civ.App.Eastland 1931, writ ref'd), Shook was employed as a pumper on an oil lease, being on duty twenty-four hours a day, and required to reside on the lease. Shook, while in a hunting party, was killed by a person whose motive in killing him was either robbery or a depraved desire to "see the deceased kick." The workmen's compensation carrier contended that the injury did not have to do with or originate in the work of the employer, and was not sustained by the employee while engaged in or about the furtherance of the affairs or business of the employer. The Court held that Shook's injury resulted from a hazard reasonably inherent in or incident to the conduct of his work as a pumper, and his death was held to be compensable.
[2] "Do you find from a preponderance of the evidence that such accidental injury, if any, inquired about in the preceding question, resulted from a risk or hazard which is necessarily, ordinarily, or reasonably inherent in, or incident to, the conduct of the work or business of Stowers Furniture Company?" | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534195/ | 283 Pa. Super. 488 (1981)
424 A.2d 914
COMMONWEALTH of Pennsylvania
v.
Michael D. KRAJCI, Appellant.
Superior Court of Pennsylvania.
Argued March 11, 1980.
Filed January 9, 1981.
*490 Malcolm W. Berkowitz, Philadelphia, for appellant.
Ellen Mattleman, Assistant District Attorney, Philadelphia, for Commonwealth, appellee.
Before SPAETH, BROSKY and VAN der VOORT, JJ.
SPAETH, Judge:
This is an appeal from judgments of sentence for robbery, criminal conspiracy, and possession of an instrument of crime.
On July 19, 1977, at approximately 9:30 a.m., Marcelo's Pharmacy in Philadelphia was robbed by two armed men. At least two hundred dollars was stolen, as well as quantities of dilaudid, percodan, desoxyn, quaalude, and valium. A principal issue at trial was whether appellant was one of the robbers.
Edmund Marcelo testified that appellant and one Daniel Cronin were the robbers. He also testified that several days after the robbery, he had identified appellant's photograph in a photo array, and that on August 17, 1977, he had identified appellant in a line-up. Marcelo said that during the robbery he was able to observe appellant for three minutes at a distance of three feet in good lighting while appellant was holding a gun on him, and that he remembered appellant's clothing and physical characteristics.
James Dunlevy, a postman, testified as follows. He walked into Marcelo's Pharmacy at the time of the robbery and was approached by Cronin, who pointed a silver revolver at his head and conducted him to the rear of the store, where he was forced to lie on the floor facing the wall. He remained in that position for five to six minutes until the robbery was over and the robbers had fled. During the robbery, Dunlevy saw only Cronin and one of Marcelo's children; he was therefore unable to identify appellant as one of the robbers. Several months after the robbery, Dunlevy identified Cronin's photograph and a photograph of the revolver used by Cronin.
*491 No other eyewitnesses to the robbery testified.[1] Detective McNamee testified to the investigation that occurred immediately after the robbery. Detectives Henwood and Cashman testified to subsequent investigations that occurred, including their observation of appellant on the evening of the robbery wearing a full beard and mustache, and the search of appellant's residence on July 21, 1977, which search uncovered no incriminating evidence. Detective Caruso testified that on August 5, 1977, appellant was arrested when he went to a hospital in Bucks County to fill a drug prescription, and that when arrested, appellant was clean-shaven. Detective Margulis testified to the circumstances surrounding Marcelo's line-up identification of appellant.
Of appellant's numerous arguments in support of a new trial, we need address but one.[2]
*492 During his cross-examination of James Dunlevy, the postman who walked into the pharmacy at the time of the robbery, appellant's counsel asked that the photograph of Cronin's revolver, which Dunlevy had been shown after the robbery, be produced. The district attorney said that the photograph was not in his possession, but the court stated that it should be produced. The next day the district attorney called to the stand Officer Loub of the Collingswood, New Jersey, Police Department. Over appellant's objection, the officer was permitted to testify as follows. On November 5, 1977, he stopped a motorist, who was later identified as Cronin, because his car was carrying an invalid inspection sticker. Cronin was the only person in the car. When asked for identification, Cronin produced a Pennsylvania operator's license and a New Jersey car registration, both in the name of Richard Noble. Loub then asked for additional identification, explaining to Cronin that he wished to run a check to learn if Richard Noble had a revoked New Jersey operator's license. When Cronin began to reach into a gym bag that was inside the car, Loub told him to remove his hand from the bag and to face him. Cronin, however, continued to look over his shoulder to see Loub's position. Loub became alarmed and placed his hand on Cronin's back, saying, "Take your hands out of the bag." Cronin said he was getting his identification, but when he turned he had a metal object in his hand. Loub grabbed Cronin's wrist, but Cronin broke the wrist free and held the object, which Loub now recognized as a gun, in Loub's face. Loub quickly snapped Cronin's hand against the roof of the car and hit Cronin on the head with a flashlight. Cronin and Loub then *493 wrestled, each trying to overpower the other. Eventually, Loub was able to reach his own gun, and placed it against Cronin's head. Loub warned Cronin to drop his gun, but Cronin continued fighting, slapping the gun from his head. Loub shot twice. One bullet struck Cronin's neck, the second his head. When Cronin fell, he was dead.
Following this recitation, Officer Loub was asked by the district attorney to identify certain photographs that had been taken in connection with the shooting of Cronin. The first photograph showed Cronin lying on the pavement beside a car. A dark stream of what appeared to be blood was flowing from his head, and a gun lay nearby. The second photograph focused on the gun lying beside Cronin's body. The third photograph, which apparently was taken at a different time and place than the shooting, showed Cronin's gun on a table next to a ruler. The fourth photograph, the only one in color, portrayed Cronin's face and torso after the shooting; partially dried blood appeared on Cronin's forehead, neck, and right nostril.[3]
After appellant's counsel had cross-examined Officer Loub, the Commonwealth recalled Dunlevy. Dunlevy identified the gun depicted in the third photograph as lying beside a ruler as the gun that Cronin had used in the robbery. He also identified the color photograph of Cronin. All four photographs were shown to the jury, although they did not go out with the jury during its deliberations. N.T. 1/26/78 at 91, 97-98.[3a]
*494 As mentioned, Officer Loub testified over appellant's counsel's objection; the only part of the testimony to which counsel did not object was when Loub stated that on November 15, 1977, he apprehended Cronin in New Jersey, and as a result recovered a gun that was photographed, which photograph was being offered as a Commonwealth exhibit. E.g., N.T. 1/25/78 at 28-29, 32-34, 47, 49. Counsel also objected to the introduction of the three photographs taken at the scene, i.e., the photograph of Cronin lying by the car, the photograph focusing on the gun beside Cronin's body, and the photograph of Cronin's face and torso, on the ground that they were irrelevant and inflammatory. E.g., N.T. 1/25/78 at 40.
In determining whether the lower court erred in allowing Officer Loub to testify to the circumstances of Cronin's apprehension and death, and admitting into evidence the photographs connected with Loub's testimony, we *495 begin with the general rule that the admission and exclusion of evidence is a matter within the discretion of the trial judge. E.g., Commonwealth v. Hart, 479 Pa. 84, 387 A.2d 845 (1978); Commonwealth v. Scott, 469 Pa. 258, 368 A.2d 140 (1976); Commonwealth v. Kivlin, 267 Pa.Super. 270, 406 A.2d 799 (1979). That discretion, however, may be abused, and abuse may be found if it appears that the judge admitted irrelevant evidence that was prejudicial to the accused, e.g., Commonwealth v. Story, 476 Pa. 391, 383 A.2d 155 (1978); Commonwealth v. Hickman, 453 Pa. 427, 309 A.2d 564 (1973), or evidence the probative value of which was outweighed by its prejudicial impact. E.g., Commonwealth v. Schroth, 479 Pa. 485, 388 A.2d 1034 (1978); Commonwealth v. Ulatowski, 472 Pa. 53, 371 A.2d 186 (1977); Commonwealth v. Bighum, 452 Pa. 554, 307 A.2d 255 (1973); Commonwealth v. Kramer, 247 Pa.Super. 1, 371 A.2d 1008 (1977); McCormick, Evidence § 185 (Cleary ed. 1972). First, therefore, we must appraise the relevance of Loub's testimony and the photographs, and then we must weigh that relevance against their prejudicial impact.
Evidence is relevant if it tends to make more or less probable the existence of some fact material to the case. Commonwealth v. Hickman, supra, 453 Pa. at 433, 309 A.2d at 567. See also Commonwealth v. Story, supra, 476 Pa. at 398, 383 A.2d at 158, quoting McCormick, Evidence § 185 at 438 (Cleary ed. 1972) ("Relevant evidence then, is evidence that in some degree advances the inquiry, and thus has probative value, and is prima facie admissible"). In the present case, the principal issue in dispute was not whether Marcelo's Pharmacy was robbed on July 19, 1977, by two armed men, but whether appellant was one of the robbers. It will be recalled that Edmund Marcelo was the only person to identify appellant as one of the robbers. Since James Dunlevy could identify only Cronin as one of the robbers, his testimony could be relevant to the issue of appellant's identity only to the extent that it supported, or contradicted, Marcelo's testimony. In certain respects, Dunlevy's testimony plainly did support Marcelo's, in particular, the testimony that Marcelo's *496 Pharmacy had indeed been robbed on July 19, and that the robber Dunlevy observed (Cronin) was armed. Dunlevy's testimony that several months after the robbery he was shown a photograph of a gun that he recognized as having been used by Cronin in the robbery, together with the introduction of the photograph, was relevant only by way of illustrating Dunlevy's earlier testimony, thereby giving the jury a better understanding of the kind of gun Cronin possessed. Loub's testimony that on November 5, 1977, he apprehended Cronin and recovered a gun that was subsequently photographed was relevant to establish a foundation for the photograph identified by Dunlevy. This testimony also tended to corroborate Dunlevy's identification of Cronin as a robber since it placed in Cronin's possession the gun used in the robbery. Thus, up to this point it may be said that Loub's testimony was relevant to the issue of appellant's identity only to the degree that it corroborated Dunlevy's corroboration of Marcelo's testimony, Loub's additional testimony, concerning the details of his apprehension and shooting of Cronin, and the photographs taken at the scene of the shooting, were relevant only in an even more attenuated way, for their only relevance was to bolster the credibility of Loub's testimony that on November 5 he apprehended Cronin and recovered a gun. In this regard, it should be noted that appellant did not attack Loub's credibility, other than to inquire why he brought a photograph of the gun to trial rather than the gun itself. Loub's credibility was not in issue, and the jury would have had no reason to disbelieve him. On balance the most that may be said regarding Loub's testimony and the photographs taken at the scene of the shooting of Cronin is that they were marginally relevant to the issue of appellant's identity.
On the other hand, the prejudice that resulted to appellant from the introduction of Loub's testimony and the photographs was substantial. Of course, as the Commonwealth asserts, it would have been illogical for the jury to impute to appellant Cronin's attempted murder of the officer, and had *497 Loub's description of the circumstances surrounding Cronin's death been briefer and the photographs taken at the scene not been introduced and displayed to the jury, any prejudice to appellant would have been minimal.[4] But Loub's description was not brief, and the photographs were introduced and displayed to the jury.
In addition, the danger this created that the jury would confuse Cronin's misdeeds with the charges against appellant was heightened and exploited by the district attorney in his closing argument, when he said:
Certainly from the evidence that you heard in this case there was an agreement to commit the crime, because two people don't just walk in a store accidentally, pull out guns accidentally, and one watches the place while the other one has the people crawling around on the floor. And they don't accidentally leave together, they don't accidentally jump in a car waiting outside with the engine running with a blond driving it. That's a conspiracy. There is an obvious agreement there.
Possession of instruments of a crime is possession of the gun. We don't have one of the guns or any of the pills, but we have the other gun, a gun which one of the co-conspirators tried to shoot a police officer in New Jersey with
Mr. Berkowitz [defense counsel]: Your Honor, I object. I ask the court to strike that remark in this case.
The Court: Motion denied.
Mr. Castille [district attorney]: You are allowed to make reasonable inferences from the facts produced, and you are allowed to draw inferences from the evidence produced in this particular crime.
That was not only an inference, that's what the policeman said. What was the guy doing, sticks a gun at the *498 policeman's head? What was he trying to do to him? He was trying to shoot him, that's all.
So possession of a weapon by either person. You heard testimony two people had guns.
N.T. 1/26/78 at 27-28.
This intemperate statement confused Cronin's attempted murder of Officer Loub with appellant's culpability for the robbery of Marcelo's Pharmacy, and amounted to an invitation to the jury to do the same. The lower court should have sustained appellant's counsel's objection to the district attorney's argument, and should have done immediately what it had failed to do when Loub's testimony and the photographs were introduced i.e., give the jury a cautionary instruction as to the limited purpose for which the testimony and photographs had been admitted into evidence. Cf. Commonwealth v. Geho, 223 Pa.Super. 525, 302 A.2d 463 (1973) (when co-defendant pleads guilty during a consolidated trial court has duty "to give adequate and clear cautionary instructions to the jury to avoid `guilt by association' as to the defendant being tried"). The lower court, however, never gave such an instruction, and the evidence was submitted to the jury to use as it saw fit.
It is settled that evidence of criminal activity not charged in the indictment or information on which the defendant is being tried cannot be introduced at trial except in certain limited circumstances. This principle is premised on the observation that although the commission of one offense is not proof of the commission of another, a factfinder will often be reluctant to acquit a known criminal. E.g., Commonwealth v. Fuller, 479 Pa. 353, 388 A.2d 693 (1978); Commonwealth v. Roman, 465 Pa. 515, 351 A.2d 214 (1976); Commonwealth v. Fortune, 464 Pa. 367, 346 A.2d 783 (1975); Commonwealth v. Foose, 441 Pa. 173, 272 A.2d 452 (1971); Commonwealth v. Wable, 382 Pa. 80, 114 A.2d 334 (1955). This principle is frequently applied to exclude evidence of the accused's own prior and subsequent crimes; but a similar principle applies to exclude evidence that might *499 persuade a jury to convict an accused on the basis of unrelated criminal activity by another. Thus in Commonwealth v. DuVal, 453 Pa. 205, 213, 307 A.2d 229, 233 (1973), the Supreme Court held that it was improper for the district attorney to call to the stand a witness likely to be associated with the defendant in the minds of the jurors, when the district attorney knew that the witness would assert his privilege against self-incrimination. "[T]he inference to be drawn from the refusal to testify of the defendant's co-defendant, accomplice or associate has no probative value whatsoever in establishing the guilt of the defendant. It is rather an effort to cause the jury to think `guilt by association.'" 453 Pa. at 213-14, 307 A.2d at 232-33 (original emphasis). Similarly, in Commonwealth v. Hales, 384 Pa. 153, 119 A.2d 520 (1956), the Court held that it was reversible error to permit the district attorney to question a defendant charged with murdering her six-week old baby about her weekly visits with her aunt, when the aunt was in no way connected with the crime but had been imprisoned for committing an unrelated murder. In Commonwealth v. Hoskins, 485 Pa. 542, 403 A.2d 521 (1979), the Court stated that it was improper for the district attorney to refer to the accused's membership in the Black Muslims, a group that had been the subject to widespread unfavorable publicity because of the criminal activity of some of its members, and in Commonwealth v. Truitt, 369 Pa. 72, 85 A.2d 425 (1951), the Court ordered a new trial because of the improper admission of evidence concerning the accused's Communistic connections. See also Commonwealth v. Bobko, 453 Pa. 475, 309 A.2d 576 (1973), and Commonwealth v. Trapp, 217 Pa. Super. 384, 272 A.2d 512 (1970) (disclosure of co-defendant's criminal history aggravated prejudice accused already suffered from improper disclosure of his own prior crimes); Commonwealth v. Greenwood, 488 Pa. 618, 413 A.2d 655 (1980) (new trial granted because of district attorney's irrelevant examination on defendant's participation in the Universal Life Church).
*500 It is the duty of the district attorney to seek justice and not merely a conviction. Commonwealth v. Evans, 479 Pa. 100, 387 A.2d 854 (1978); Commonwealth v. Starks, 479 Pa. 51, 387 A.2d 829 (1978); Commonwealth v. Mayberry, 479 Pa. 23, 387 A.2d 815 (1978); ABA Project on Standards for Criminal Justice, Standards Relating to the Prosecution Function § 1.1(c) (Approved Draft, 1971). Here, the Commonwealth admits in its brief that it "had no intention of calling Officer Loub as a witness or presenting any evidence concerning the fatal encounter between Loub and Cronin" until appellant requested the production of the photographs, Commonwealth's Brief at 18, and further asserts that "[i]f defendant wished to keep Loub's testimony from the jury, he should have refrained from demanding the photograph."[5]Id. The lower court accepted this excuse.[6] We do not. Appellant's counsel had the right to demand the production of the photograph of the gun identified by Dunlevy. Indeed, the photograph should have been introduced when Dunlevy first testified that he had made the identification. Counsel also had the right to demand that a foundation be laid before the photograph was admitted into evidence. It should have been a simple matter for the district attorney to lay the necessary foundation without asking Loub to describe his shooting of Cronin, a collateral matter that was not probative of any matter in dispute. Instead, the district *501 attorney intentionally developed an inquiry into the circumstances of Cronin's violent death, displayed photographs of Cronin's dead body to the jury, and then, during closing argument, confused the charges against appellant with Cronin's misdeeds. The effect of this conduct was to punish appellant for exercising his right to insist that the Commonwealth be put to its proof. In these circumstances, the Commonwealth is in no position to argue that the potential prejudice caused by the conduct did not in fact materialize.[7]See generally Commonwealth v. DuVal, supra; Commonwealth v. Williams, 470 Pa. 172, 368 A.2d 249 (1977); Commonwealth v. Cannon, 453 Pa. 389, 309 A.2d 384 (1973). Nor can it be maintained in these circumstances, where only one eyewitness identified appellant at trial and no cautionary instructions were given by the court, that the prejudice suffered by appellant was harmless beyond a reasonable doubt. Commonwealth v. Story, supra.
Judgment of sentence reversed, and case remanded for new trial.
VAN der VOORT, J., notes his dissent.
ORDER
And now on this 7th day of January 1981 it is ordered that the opinion authored by me in the case of Commonwealth v. Krajci, filed on August 1, 1980 be withdrawn and that my revised opinion in this case be filed.
NOTES
[1] Marcelo's two children (ages 12 and 13) were in the pharmacy at the time of the robbery, but were not called at trial. Instead, Detectives Henwood and Cashman testified that on July 20 the children identified appellant's photograph in a photo array. (We are unable to determine precisely what Detective Henwood's testimony was because the transcript of his testimony, for some reason, is not included in the record that was transmitted to us by the lower court.) The district attorney evidently believed that he was not required to call the children to the stand because he had offered to make them available for appellant to call. See N.T. 1/24/78 at 130; N.T. 1/26/78 at 46-47. The soundness of the district attorney's belief is questionable. The children were not in fact in the courtroom during Henwood's and Cashman's testimony, and thus were physically unavailable for immediate cross-examination by appellant. See generally Commonwealth v. Sanders, 260 Pa.Super. 358, 394 A.2d 591 (1978); Commonwealth v. Dugan, 252 Pa.Super. 377, 382, 381 A.2d 967, 970 (1977) (SPAETH, J., concurring); Commonwealth v. Hill, 237 Pa.Super. 543, 353 A.2d 870 (1975); McCormick, Evidence § 251 at 603 (Cleary ed. 1972); see also Commonwealth v. Gore, 262 Pa.Super. 540, 396 A.2d 1302 (1978); Commonwealth v. Rossetti, 255 Pa.Super. 524, 388 A.2d 1090 (1978). Moreover, the Commonwealth has cited no authority for the proposition that Henwood and Cashman could testify to the out-of-court identifications by Marcelo's children before the children themselves testified.
[2] Because of our decision infra, we do not consider appellant's arguments that he is entitled to a new trial because the lower court 1) did not suppress Marcelo's identifications; 2) ruled that appellant's prior convictions could be used to impeach him; 3) denied appellant's application for a bill of particulars; 4) allowed the Commonwealth to amend the informations two days before trial; 5) instructed the jury that the trial judge was "the law"; 6) refused to declare a mistrial after Marcelo and the district attorney referred to appellant's mugshots; 7) allowed the jury to observe a slide of a line-up that showed appellant dressed in prison garb; and 8) failed to discharge the jury when it informed the court that its deliberations were "hopelessly deadlocked." Nor do we consider appellant's allegations of prosecutorial misconduct and erroneous evidentiary rulings other than those specifically discussed infra. Appellant has also argued that he should be discharged because the evidence was insufficient to support his convictions. We have considered this argument, and have found it without merit.
[3] Loub also identified a fifth photograph a mugshot of Cronin taken on May 12, 1971. The description in the text of the photographs is based on the photographs themselves, which are part of the record before us on appeal. It has been suggested to us that the jury did not actually see the photographs. Regarding this suggestion, see note 3a infra.
[3a] The following interchange appears in the notes of testimony:
Mr. Berkowitz: You're not going to let the photographs of Cronin with the bullet in his head go out with the jury, will you? The Court: Of course not. We'll come to the exhibits, but I don't think any exhibits will go out. They've been shown to the jury. N.T. 1/26/78 at 91 (emphasis added).
After our opinion in this case was first filed, we received separate written communications from the lower court and from defense counsel stating that the court's answer to counsel's question above notwithstanding, "the photographs of Cronin with the bullet in his head" were not shown to the jury. However, our decision does not depend on the jury's actually having seen the photographs. At trial, defense counsel objected to the entire line of testimony by Officer Loub concerning the circumstances of Cronin's death and also to the introduction of the photographs into evidence. As noted in the text, supra, Officer Loub first described the struggle in which Cronin was killed by a shot from a gun placed against his head; he then identified each photograph. Following this testimony, Dunlevy was asked to identify the color photograph of Cronin, and he prefaced his identification by saying, "Well, I can tell you who it resembles. It's pretty hard to tell somebody when he's been shot through the head." N.T. 1/25/78 at 64. In our discussion below of the balance between relevance and prejudice, see infra at 918, we consider the marginal relevance of Loub's testimony as to the details of Cronin's death as compared with the substantial prejudice arising from that testimony. We also note the prejudice created by the district attorney's exploitation of Loub's testimony in his closing argument. See infra at 918-919. If we assume that the jury did not actually see the photographs, the prejudice to appellant from Officer Loub's testimony and the district attorney's closing argument would nevertheless require us to reverse the judgment of sentence and order a new trial. Because this is the case, we need not decide what effect we could properly give to the communications we received after our opinion was filed.
[4] Indeed, the first time Dunlevy was called to testify, he made several passing remarks, without objection from appellant's counsel, regarding Cronin's death. See N.T. 1/24/78 at 16, 35-36.
[5] These assertions belie the Commonwealth's assertion elsewhere in its brief that "evidence of Cronin's traffic violation, and ensuing gun battle with Officer Loub, was essential to establish Cronin's identity as one of the males who held the Marcelos and Dunlevy at bay with the identical weapon," Commonwealth's Brief at 18. Furthermore, Loub's testimony regarding his shooting of Cronin did not establish Cronin's identity as one of the robbers of Marcelo's Pharmacy; it was, as has been discussed, at best only marginally relevant to buttress Loub's credibility (which had not been attacked).
[6] At trial the lower court stated:
Well, presuming this matter has a prejudicial effect, which I don't believe insofar as the ambience of the entire matter, this has to be told. The point here is that a very simple question here has been, from the defense point of view, according to your objection here, has been exacerbated by an objection that required this testimony be established.
N.T. 1/25/78 at 49-50.
[7] Although they do not affect our result, we note that the record discloses other instances of intemperate conduct by the district attorney. For example, at one point in the trial, the district attorney referred to appellant's mugshot. N.T. 1/19/78 at 68. Later, during closing argument, when appellant objected to the district attorney's references to the out-of-court identifications by Marcelo's children, see note 1, supra, the district attorney stated:
All right, let's bring the children in here, bring them in, put them on the witness stand, let Mr. Berkowitz [defense counsel] ask them the questions I can't even understand. Let's let these little children relive the traumatic experience. That sounds like a lot of fun. N.T. 1/26/78 at 48. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534226/ | 120 N.H. 836 (1980)
CITY OF LEBANON
v.
A. STORRS TOWNSEND
No. 79-354.
Supreme Court of New Hampshire.
December 22, 1980.
*837 Decato & Cirone, of Lebanon (R. Peter Decato orally), for the plaintiff.
McNamara & Larsen, of Lebanon (Marilyn B. McNamara orally), for the defendant.
[1] BOIS, J.
The issue presented in this case is whether a person who has not applied for a municipal business license may, in a 1979 civil contempt proceeding to enforce a court order entered against him in 1971, challenge the constitutionality of an ordinance relating to the procedure for obtaining that license. We hold that he does not have standing to make that challenge.
The defendant, A. Storrs Townsend, has operated the same business within the City of Lebanon for more than thirty years. On June 1, 1965, the city enacted Ordinance 22, which it amended on August 2, 1965, and re-enacted on October 18, 1978. The ordinance prohibits anyone from maintaining or operating a junkyard within the city limits without first obtaining a license from the city manager or city council and sets forth the procedure for obtaining the license. The defendant refuses to apply for a license.
On December 22, 1971, the superior court, in an equity action brought by the city against Mr. Townsend, found that the defendant was operating a junkyard in violation of Ordinance 22 and ordered him to comply with the ordinance. In another action brought against him by the city, the Lebanon District Court, on September 11, 1978, also found that the defendant was in violation of the ordinance and ordered him to remove all junk from his premises within 60 days. Furthermore, between April and September of 1979, the city filed 154 complaints with the Lebanon District Court, charging the defendant with operating a junkyard in violation of Ordinance 22. The district court, after two separate hearings, found the defendant guilty of violating Ordinance 22 and fined him a total of $3,175. The defendant appealed from these convictions to the superior court for a trial de novo.
Shortly thereafter, the city filed a petition for capias and for a finding of contempt in the superior court, alleging that the defendant had failed to comply with the December 22, 1971, court order. The superior court held a hearing on September 26, 1979, at which the parties agreed to consolidate a number of the appeals from the district court. The parties also stipulated that "if the city prevails on its petition for capias . . . it will prevail on the 154 appeals." The Court (Johnson, J.) held as a matter of fact and law that the defendant does operate a junkyard, reaffirmed the defendant's convictions for violating Ordinance 22, and found the *838 defendant in contempt of court for failing to abide by the 1971 court order. The superior court ordered the defendant to pay the full amount of the fines levied by the district court and to remove the junk from his premises. The superior court also ruled that by following these directives the defendant could purge himself of the contempt.
The defendant appeals the finding of contempt but does not contest the factual findings of the superior court. He does not question the jurisdiction of the court, see Latrobe Steel Co. v. United Sheetworkers, 545 F.2d 1336 (3d Cir. 1976), or its authority to issue the 1971 order, see ITT Community Dev. Corp. v. Barton, 569 F.2d 1351 (5th Cir. 1978). He does not challenge the authority of the City of Lebanon to exercise its police power to regulate the use of property within the city limits, see State v. Cohen, 73 N.H. 543, 63 A. 928 (1906), the reasonableness of requiring a license as a condition to operating a junkyard, see Lachapelle v. Goffstown, 107 N.H. 485, 225 A.2d 624 (1967), or the reasonableness of imposing fines to force compliance with the ordinance, see State v. Fletcher, 5 N.H. 257 (1830). He asks us to excuse his past disobedience if, as he now alleges, the ordinance underlying the court order is unconstitutional.
The defendant argues that the procedure for obtaining a license as set forth in Ordinance 22 is so lacking in due process as to render the entire ordinance unconstitutional and thereby unenforceable against him. He asserts that the licensing procedure does not insure adequate notice of a hearing, does not provide adequate opportunity to prepare for a hearing, does not delineate sufficient standards and, in short, is filled with the potential for arbitrariness and capriciousness. The defendant, however, has never applied for a license. The defendant merely speculates that the alleged harm will be realized.
[2] We will not invalidate an ordinance based on a mere conjecture that the city will either interpret or administer the ordinance in a manner detrimental to the constitutional rights of the defendant. See Bliss Excavating Co. v. Luzerne County, 418 Pa. 446, 211 A.2d 532 (1965); Robins v. County of Los Angeles, 248 Cal. App. 2d 1, 56 Cal. Rptr. 853 (1966).
[3] In a coercive civil contempt proceeding, the general rule is that a court will not reconsider the legal or factual justification for the order alleged to have been disobeyed. Maggio v. Zeitz, 333 U.S. 56, 69 (1948); Morgan v. Kerrigan, 509 F.2d 618, 620 (1st Cir. 1975). The underlying action out of which the contempt charge *839 arose is separate and distinct from the contempt proceeding. See State v. Towle, 42 N.H. 540, 544 (1861). Accordingly, once a court having jurisdiction over the subject matter and the parties renders a final order within its authority, that order "becomes res judicata and not subject to collateral attack in the contempt proceedings." Maggio v. Zeitz, supra at 68; State v. Linsky, 117 N.H. 866, 876-77, 379 A.2d 813, 819 (1977).
[4] An individual subject to a court order must obey that order until it is reversed on direct appeal, stayed or dissolved by the court, regardless of how constitutionally suspect the ordinance upon which it is based may be. Walker v. City of Birmingham, 388 U.S. 307 (1967); United States v. United Mine Workers, 330 U.S. 258, 293-94 (1947). The defendant herein never sought reversal of the 1971 court order by direct appeal, and the order may not be attacked collaterally. Accordingly, the defendant has no standing, in his appeal from the contempt proceeding, validly to claim that the court erroneously issued the order of December 22, 1971.
In view of the fact that the defendant has presented no questions which he has standing to raise, the judgment of the superior court is
Affirmed.
All concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534189/ | 468 S.W.2d 818 (1971)
Victor MILLER, Appellant,
v.
The STATE of Texas, Appellee.
No. 43740.
Court of Criminal Appeals of Texas.
June 16, 1971.
Rehearing Denied July 28, 1971.
*819 Will Gray, Houston, for appellant.
Carol S. Vance, Dist. Atty., Phyllis Bell and Ted Busch, Asst. Dist. Attys., Houston, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ODOM, Judge.
This appeal is from a conviction for the offense of murder with malice. The punishment was assessed by the jury at life.
The record reflects that appellant, in company with Eugene DeLeon, an employee of a service station in Pasadena, was working on his car during the evening of November 6, 1965; that the deceased entered the service station around midnight and asked to use the telephone. After completing her call, she walked back to her car and "was laying on the seat" when DeLeon, who testified that he "thought she was drunk," approached her and "told her to leave," as he was preparing to close the service station. DeLeon further testified that deceased told him "that she wasn't well and she couldn't drive and she wanted somebody to drive her home." Appellant then told DeLeon that he would take the woman home, and left the service station driving deceased's car. The following morning, deceased's body was found in the back seat of her automobile in a pasture; she had been choked and beaten to death. Approximately seven months later, appellant was apprehended by Dallas authorities and returned to Harris County for trial.
Appellant presents twenty-one grounds of error, all of which pertain to the admissibility of his confessions; timely appointment of counsel; constitutional warnings; and waiver of constitutional rights. In view of the questions presented and the particular circumstances of this case, we deem it necessary to set out in detail the facts surrounding the arrest, and subsequent confessions which directly deal with appellant's first fifteen grounds of error.
The record reflects that appellant was arrested in Dallas County at his place of employment of June 6, 1966, under authority of a warrant for arrest based upon an indictment out of Harris County charging him with the offense of murder. Immediately thereafter, he was taken before a magistrate; he was not questioned at this time. The magistrate, Judge Friedlander, testified as follows:
"Q. Did you advise him why he was in custody?
"A. Yes. I told him he was being held for investigation of a murder out of Harris County.
"Q. What else did you advise him, other than what he was charged with?
"A. Well, I told him that he had a right to an attorney; that our detectives would permit him to call an attorney here or that he could call an attorney when he got back to Houston or that he could request the appointment of an attorney when he got to Harris County, if he was unable to get his own attorney. I told him that he was not required to make any statement; that if he did make a statement, that statement could be used against him if the case went to trial.
*820 * * * * * *
"THE COURT: Did you advise him if he didn't have a lawyer, that you would appoint one?
"THE WITNESS: Yes, sir, that is what I answered when the District Attorney first asked me.
"THE COURT: I didn't understand that.
"THE WITNESS: I told him that he had a right to an attorney; that we would permit him to phone an attorney in Dallas; or if he wanted to wait to come back to Harris County, that he could get one here; or if he was unable to get his own attorney, he could request the appointment of an attorney when he came back to Harris County.
"THE COURT: Well, did you advise him whether you would appoint an attorney then?
"THE WITNESS: I did not advise him that I would appoint an attorney for him. He didn't request an attorney at the time.
"THE COURT: He didn't request one. You told him that he could have an attorney when he got back to Houston?
"THE WITNESS: Right. Or I told him that he could use the telephone right there and call one.
* * * * * *
"THE COURT: You told him that he could use the phone and call an attorney?
"THE WITNESS: Right. Or call someone to get an attorney for him. At the end of this, I always ask them if there are any questions. And I don't recall him making any request or asking any questions about it.
"THE COURT: Did you advise him that he had a right to remain silent?
"THE WITNESS: Right. I told him that if he made any statement, it could be used against him, of any kind.
* * * * * *
"THE COURT: You did advise him that if he made a statement, it could be used against him?
"THE WITNESS: That is right."
Judge Friedlander, on cross-examination by defense counsel, again testified:
"Q. Tell me exactly how you advised him of his right to counsel?
"A. I told him that he had a right to an attorney; that he could call an attorney at that time; that the detectives would permit him to call an attorney; or that if he wanted to wait until he got back to Harris County, he could call in Harris County; or he request the appointment of a lawyer when he got back to Harris County." (Emphasis supplied)
The record further reveals that after the aforementioned warnings were given appellant[1] he was placed in jail to await the arrival of Harris County authorities. Two Deputy Sheriffs arrived around midnight the same day, and upon meeting appellant they again warned him of his constitutional rights as evidenced from the record:
"Q. Did you give him a warning?
"A. It was read.
"Q. Who read it?
"A. I did.
"Q. And what warning did you give him, Mr. Cleboski?
"A. It was the warning that we call the warning upon arrest. It was a printed card that had been issued to us. * * * For substance, it was that he didn't have to say *821 anything; he had the right to a lawyer; he could remain silent; if he made a statement it could be used against him and probably would be used against him."
After appellant was warned of his rights the second time by the two Houston deputies, he left Dallas in company with the officers for Houston approximately "1:00 A.M." En route to Houston, after stopping to eat at a cafe, the appellant "discussed the case then." He and the deputies arrived in Houston "around 4:00 A.M." on June 7th, 1966. Later that same morning, he led the officers to where he had hidden a pill box belonging to deceased and retrieved this object himself, which was found "inside of a junk yard * * * inside of a door and up in the rafters of the shop." See Article 38.22(e) Vernon's Ann.C.C.P.
Appellant later made statements to the press, after signing a written note that "he would freely talk to the newspapers and all news media." Subsequently a full written confession was made after a warning was given.
The trial court held an exhaustive independent hearing on the voluntariness of the written confession and filed findings of fact and conclusions of law to the effect that appellant was afforded all of his rights pursuant to Article 15.17, V.A.C.C.P., and in compliance with the standards enunciated in Jackson v. Denno, 378 U.S. 368, 84 S. Ct. 1774, 12 L. Ed. 2d 908. However, we conclude that this case hinges on the adequacy of the Dallas warning. See Wong Sun v. United States 371 U.S. 471, 83 S. Ct. 407, 9 L. Ed. 2d 441.
We are squarely confronted with the issue of whether or not appellant, under the circumstances presented by this case, was entitled to appointed counsel during the six hour time period he spent awaiting transfer to Houston. We hold first of all that he was not; and secondly, even if he was, such right was effectively, intelligently, and knowledgeably waived. As previously pointed out, appellant was clearly apprised of his right to call a lawyer in Dallas and of his right to have an attorney appointed in Houston. Secondly, he made no request whatsoever to contact a lawyer, either retained or appointed. Thirdly, he underwent no interrogation as reflected by the record, and was asked no questions until he began volunteering information en route to Houston. In this context, the record reflects the following testimony by one of the two deputies to whom oral incriminations were made:
"Q. During the drive down from Dallas, did you discuss the case or any details with the defendant?
"A. (By Officer Cleboski) Yes. We stopped and ate at a small town outside of Dallas. And then, after we left the cafe, we discussed the case then."
On cross-examination, Officer Cleboski further testified:
"Well, for a while it was very little conversation. And then, they (Officer Irby and appellant) got to talking. And Miller, Mr. Miller, started just talking about the murder and the whole story." Complaint is made that evidence of oral admissions which occurred at this time was in violation of Massiah v. United States, 377 U.S. 201, 84 S. Ct. 1199, 12 L. Ed. 2d 246, and Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694. These arguments are misplaced. In Massiah, supra, the incriminating statements were secured as a result of surreptitious eavesdropping by officers who implanted a radio transmitter in the appellant's car, while he was on bail. Such a situation is clearly not evident in the case at bar. Furthermore, we do not have a problem such as that which occurred in Escobedo v. Illinois, 378 U.S. 478, 84 S. Ct. 1758, 12 L. Ed. 2d 977, where Escobedo, while undergoing constant interrogation, was repeatedly denied an opportunity to consult counsel.
*822 In Miranda v. Arizona, supra, the Supreme Court stated:
"Prior to any questioning, the person must be warned that he has a right to remain silent, that any statement he does make may be used as evidence against him, and that he has a right to the presence of an attorney, either retained or appointed. The defendant may waive effectuation of these rights, provided the waiver is made voluntarily, knowingly and intelligently. If, however, he indicates in any manner and at any stage of the process that he wishes to consult with an attorney before speaking there can be no questioning."
In the case at bar, appellant was clearly warned of all afore-mentioned rights; he did not indicate in any way that he desired counsel, and the record repeatedly evidences the fact that he waived his right to counsel voluntarily, knowingly, and intelligently.
Furthermore, the record is completely void of any indication of coercion, either physical or psychological, and none is alleged. See Phelper v. Decker, 401 F.2d 232 (5th Cir.). The Supreme Court of the United States has held that the constitution does not require that an accused have a lawyer before he may waive a constitutional right. Adams v. United States ex rel. McCann, 317 U.S. 269, 63 S. Ct. 236, 87 L. Ed. 268. See also Johnson v. Zerbst, 304 U.S. 458, 58 S. Ct. 1019, 82 L. Ed. 1461; Narro v. United States (5th Cir.) 1966, 370 F.2d 329, cert. denied, 1967, 387 U.S. 946, 87 S. Ct. 2081, 18 L. Ed. 2d 1334; United States v. Venere (5th Cir., 1969) 416 F.2d 144.
The Fifth Circuit recently reaffirmed this position in Gilpin v. United States, 415 F.2d 638. In Gilpin, supra, a case where the factual situation was similar to the one at bar, the court reversed because the accused was given his constitutional warnings under conditions less than ideal. The court stated:
"Gilpin had only a sixth grade education. He signed the waiver and made his statement the morning after he was arrested for drunkenness. Apparently his mental faculties were not functioning fully the `morning after' since he confused the date of the mail robbery with the date he was in jail."
In the case at bar, appellant had received a twelfth grade education, and was under neither the influence of intoxicants nor drugs. Furthermore, the record lends credence to Officer Cleboski's testimony that appellant "just started talking." Witness DeLeon testified that he saw appellant the day after the alleged murder and that:
"* * * He told me about some murder that he apparently committed or something about it. I didn't pay much attention to it, because I didn't believe him.
"Q. He was always saying things like that?
"A. Yes, he was. Well, not saying that he murdered people, but, I mean, other things that would not be true."
The witness stated that he also recalled hearing appellant tell a man who "was running a wrecking yard" about the killing.
Del Monte Whitehurst testified that on November 7, 1965, at approximately 8:30 A.M. the appellant telephoned him and asked to be picked up, and then the following is revealed in the record:
"Q. (By the State's Attorney) At the time that you talked to him, did he say anything else, other than he wanted you to pick him up?
"A. Well, he thought he was in some trouble.
"Q. All right. Did he elaborate, did he say anything further about what trouble he was in?
"A. Yes, sir.
*823 "Q. What did he say, Mr. Whitehurst?
"A. Oh, it was about that he thought he had killed somebody."
It is apparent that appellant was willing to freely discuss his actions with friends and acquaintances (including law enforcement officers). See Santiago v. State, Tex. Cr.App., 444 S.W.2d 758; Easley v. State, Tex.Cr.App., 448 S.W.2d 490; Gunter v. State, Tex.Cr.App., 421 S.W.2d 657; McCandless v. State, Tex.Cr.App., 425 S.W.2d 636; United States v. Hayes (5th Cir.) 385 F.2d 375; Charles v. State, Tex.Cr.App., 424 S.W.2d 909; Carter v. State, Tex.Cr. App., 445 S.W.2d 747; Gonzales v. State, Tex.Cr.App., 429 S.W.2d 882; Torres v. State, Tex.Cr.App., 422 S.W.2d 741.
The first fifteen grounds of error are overruled.
By grounds of error 16 through 19, appellant contends the trial court should have instructed the jury in accordance with the statutes in effect at the time trial began, rather than the amended statutes; that his rights were not fully protected by the court's charge, and that the court's instruction in regard to oral confessions is violative of the holding in Rogers v. Richmond, 365 U.S. 534, 81 S. Ct. 735, 5 L. Ed. 2d 760.
The record reflects trial began on August 21, 1967, and that Articles 15.17 and 38.22, Vernon's Ann.C.C.P., as amended became effective August 28, 1967. The 1967 Laws of the 60th Legislature, Chapter 659, Sec. 41, provide:
"Any confession admissible at the time it was made shall be admissible at any trial subsequent to the effective date of this Act. The provisions of this Act shall not affect the admissibility of confessions made prior to the effective date of the Act."
We perceive no error in the court's charge; the amended statutes are not ex post facto as applied to this case. Ritchey v. State, Tex.Cr.App., 407 S.W.2d 506. Furthermore, the court's charge fully protected appellant's constitutional rights in accordance with Miranda v. Arizona, supra, and we find no merit in his general allegation of harm. Reliance upon Rogers v. Richmond, supra, is misplaced as that case involved a coerced confession. Such an element is neither present nor alleged in the case at bar.
Grounds of error sixteen through nineteen are overruled.
Appellant brings as his 20th ground of error the contention that the court's charge on admissibility of his written and oral statements was "multifarious and duplicitous," and therefore confusing to the jury.
The record reflects that the trial court separately instructed the jury on the admissibility of the written and oral statements, and the law applicable to each. The requirements of Article 36.14, V.A.C.C.P., were clearly met. Ground of error number twenty is overruled.
By his twenty-first ground of error, appellant complains of the court's instructions to the jury in regard to the applicable law relating to oral and written statements. He further contends that the court strained to secure a favorable jury finding on the warnings given by Officer Cleboski, and thus in a subtle way commented on the evidence.
We find no such indication in the record. Further, as mentioned previously, we consider the first warning given as adequate.
Ground of error number twenty-one is overruled.
There being no reversible error, the judgment is affirmed.
MORRISON, Judge (concurring).
I do not agree with the majority that the appellant was not entitled to the services of an attorney while in Dallas, and at all times before he began confessing.
*824 It is my opinion that the written confession was admissible and was obtained from the defendant after he had waived his constitutional rights against self-incrimination. When he agreed to be interviewed by newspaper reporters prior to the making of the written confession, he gave strong indication of his willingness to talk despite his right not to talk. The long written confession which was read to the jury and gave full, gory facts in detail, was so condemning as to render the admission of the oral confession harmless error. The oral confession, as given in the testimony, was brief and absent any details.
To paraphrase Harrington v. California, 396 U.S. 250, 89 S. Ct. 1726, 23 L. Ed. 2d 284, I can conceive of no "juror whose mind might have been made up because of" the oral confession.
NOTES
[1] He made no claim of indigency at this time. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534268/ | 424 A.2d 139 (1981)
Rhoda F. GRANT
v.
William R. GRANT.
Supreme Judicial Court of Maine.
Argued June 3, 1980.
Decided January 2, 1981.
*140 Markos & Roy, Peter R. Roy (orally), Ellsworth, for plaintiff.
Libhart, Ferris, Dearborn, Willey & Ferm, Wayne P. Libhart (orally), William N. Ferm, Ellsworth, for defendant.
Before McKUSICK, C. J., and WERNICK, NICHOLS and GLASSMAN, JJ.
WERNICK, Justice.
Defendant William R. Grant has appealed from the child support and property division provisions of a divorce judgment entered in the Superior Court (Hancock County) on November 29, 1979. The appeal raises three issues: (1) whether the court's order for support of children is erroneous because it erroneously conceived the legal obligation of the wife to contribute to the support of the children; (2) whether the court, in light of Section 722-A(4),[1] had authority to divide any property of the Grants, even if it was correctly held to be marital property, acquired prior to January 1, 1972, in the absence, as here, of a "request ... in writing" made by "both parties" that the court "order disposition of [such] marital property. . ."; and (3) whether the court committed error in classifying as marital property, subject to division under 19 M.R.S.A. § 722-A (Supp.1979-80), certain real estate known as the "Coyle house" acquired during their marriage by the defendant and the plaintiff Rhoda F. Grant, through a devise to them as joint tenants.
On the first and second issues the Court is unanimous in its opinion that the Superior Court acted without error. On the third issue, the Superior Court's classification of the "Coyle house" as marital property, Chief Justice McKusick and I are of the opinion that the Superior Court committed error but Justices Glassman and Nichols disagree concluding that there was no error. No error, therefore, being found by a majority of the Court, the judgment of the Superior Court is affirmed.
Rhoda and William Grant were married in Maine on December 2, 1967, and they resided in this State during all of their marriage. They have three minor children. In August, 1978, Rhoda instituted an action for divorce on the grounds of cruel and abusive treatment and irreconcilable differences. At the time of the divorce hearing, *141 the spouses had been separated for a year; Rhoda had been residing at the "Coyle house" and William had been living at the family residence located less than a half mile away.
The Superior Court justice granted a divorce to Rhoda on the ground of irreconcilable differences. He classified all of the Grants' substantial property as "marital" and distributed it approximately equally between them. The distribution to Rhoda included the "Coyle house", furnishings, and adjoining land. Included in the property distributed to William was the family home, its furnishings, and the adjoining land. Rhoda was awarded $1.00 per year as alimony.
The justice also found:
"Since under the current law of the State of Maine, the Defendant-father is liable for the full support of the minor children, without any contribution from the Plaintiff-mother. . . the Defendant-father shall pay to the Plaintiff-mother the sum of Three Hundred Dollars ($300.00) per month for the support of said children."
Defendant William Grant filed a timely Motion to Alter or Amend Judgment, pursuant to Rule 59(e) M.R.Civ.P., to have deleted the above quoted language respecting his liability, as father, for child support and to have the justice order the plaintiff, as mother, to maintain medical insurance for the children. This motion was granted, the judgment was amended accordingly, and defendant thereafter took the present appeal from the amended judgment.
1.
Defendant's point is correct that the original formulation of the order for support erroneously conceived the law of Maine when it said that the
"father is liable for the full support of the minor children, without any contribution from the ... mother."
See 19 M.R.S.A. § 752 (1979-80). Wood v. Wood, Me., 407 A.2d 282 (1979). However, this erroneous statement was omitted in the amended judgment and, as requested by defendant, the amended judgment did require the mother of the children to contribute to their support in the form of maintaining medical insurance for each child.
It is the judgment as amended that is the final judgment from which defendant's appeal is taken. Moreover, since the amended judgment embodied exactly the contribution by his wife to child support that defendant sought in his motion to amend, defendant will not now be heard to complain, for the first time on appeal, that the amended judgment should have required her to make a larger contribution.
We therefore affirm the child support provisions of the Superior Court's judgment.
2.
On the controlling authority of Fournier v. Fournier, Me., 376 A.2d 100 (1977) and Bryant v. Bryant, Me., 411 A.2d 391 (1980), we reject defendant's claim on appeal that absent, as here, a written request by the parties for the disposition of property (marital or non-marital) acquired by either or both of them prior to January 1, 1972, the Superior Court lacked authority to divide such property.
3.
As to defendant's only remaining point on appeal on which the Court is evenly divided, I write for Chief Justice McKusick and myself. Our opinion is that the Superior or Court erred in deciding that the "Coyle house" was marital property under the provisions of Section 722-A.
While Rhoda and William Grant were husband and wife (and before any legal decree of separation, none being involved here) the "Coyle house" was devised to them as joint tenants. We conclude that the fact alone that the Grants acquired the Coyle house by a devise from a third person excludes it as marital property, notwithstanding the other circumstances that the acquisition occurred during marriage and was an acquisition in joint tenancy.
The provisions of Section 722-A(3) delineate the circumstances giving rise to a "presumption" *142 of marital property as well as those that overcome such presumption. As to the overcoming of the presumption, subsection 3 is not self-contained but interrelates with the provisions of Section 722-A(2). This appears from the language in subsection 3:
"The presumption of marital property is overcome by a showing that the property was acquired by a method listed in subsection 2."
Because of this linkage of subsections 2 and 3 we interpret them to express a conception that is fundamentally unitary but has two subsidiary facets: (1) property "acquired... subsequent to the marriage" is presumptively marital property, and (2) property thus acquired moves beyond being only presumptively marital and becomes established as conclusively defined marital property if the presumption is not overcome by any of five specifically enumerated factors. One of these five factors is that the "[p]roperty [was] acquired by gift, bequest, devise or descent."
We proceed, then, in accordance with this foundational conception to apply Section 722-A to the circumstances of this case.
Because of the undisputed fact that the property at issue was "acquired ... subsequent to the marriage", we inquire, first, whether such time of acquisition was sufficient to make the property presumptively marital property under subsection 3. As to this, we note the additional language appearing in subsection 3, that the property must have been acquired by "either" spouse. This raises the question whether an acquisition in "joint tenancy", beyond being an acquisition by both spouses, is also an acquisition by "either" spouse. More sharply focused, this issue is whether "either" spouse connotes that one, or the other, spouse must acquire the property in a sole, or individual, form of ownership.
We conclude that the answer to this question is provided by the other language in subsection 3:
"regardless of whether title is held individually or by the spouses in some form of co-ownership such as joint tenancy, tenancy in common, tenancy by the entirety, and community property."
We take this language to signify that property is acquired by "either" spouse, within the contemplation of subsection 3, whether or not title is held "individually" and even if it is held by the spouses in "joint tenancy", as one "form of co-ownership."
We conclude, therefore, that under Section 722-A(3) the Coyle house was "property acquired by either spouse subsequent to the marriage", and for that reason it became, presumptively, marital property.
The next inquiry is whether, as provided in subsection 3, the presumption is "overcome by a showing" that the said property, presumptively marital, was acquired "by a method listed in subsection 2."
For this purpose, we turn to the provision in subsection 2 that:
"`marital property' means all property acquired by either spouse subsequent to the marriage except: A. Property acquired by gift, bequest, devise or descent."
Since the undertaking in which we are engaged is to bring to bear the functional interrelationship by which this provision in subsection 2 overcomes the presumption arising by virtue of subsection 3, we discern no sound reason to conclude that the words "either spouse" in subsection 2 are calculated to have a meaning different from that plainly delineated as their meaning in subsection 3. Hence, for the purposes of subsection 2, as interrelated with subsection 3, we decide that property is acquired by "either spouse" even when there is an acquisition in a "form of co-ownership such as joint tenancy."[2]
*143 Under Section 722-A(3), then, the Coyle house, because it was acquired by "either spouse" subsequent to marriage and prior to a decree of legal separation, was presumptively marital property. The presumption, however, was overcome by the provisions of Section 722-A(3) as interrelating with those of Section 722-A(2). The presumption was overcome by the fact that the "method" of acquisition was one of those "listed" in Section 722-A(2), namely, that the "[p]roperty [was] acquired by gift, bequest, devise or descent."[3]
The case at bar must be distinguished from the recently decided case of Carter v. Carter, Me., 419 A.2d 1018 (1980). In Carter, the principle of "transmutation" became applicable because that case dealt with a claimed gift by one spouse to the other. Transmutation cannot be applicable in a case where, as in the instant case, the acquisition of property during marriage is by "gift, bequest, devise or descent" from a third person other than the spouses.
Here, then, the plain meaning of the statute remains controlling, cf. Grishman v. Grishman, Me., 407 A.2d 9, 12 (1979), and the "Coyle house", acquired by a method listed in subsection 2 of 19 M.R.S.A. § 722-A, must be excluded from the category of "marital" property.
The entry shall be:
The judgment of the Superior Court is affirmed.
McKUSICK, C. J., concurring.
GLASSMAN, J., with whom NICHOLS, J., joins, concurring in separate opinion.
GLASSMAN, Justice, with whom NICHOLS, Justice, joins, concurring.
Because of my disagreement with part 3 of the Court's opinion, I write separately on behalf of Justice Nichols and myself.
The statutory definition of marital property is found in 19 M.R.S.A. § 722-A(2). This definition is not without ambiguity. The Missouri Court of Appeals (Kansas City District) announced an interpretation of an identically worded statute completely inconsistent with that adopted by the opinion of this Court. See Forsythe v. Forsythe, 558 S.W.2d 675 (Mo.App.1977). Neither the interpretation of the Missouri court nor the interpretation of this Court is logically compelled by either the language or the structure of subsection 2. Although it is true, as noted by the opinion of the Court, that subsections 2 and 3 of Section 722-A are functionally interrelated, that conclusion does not aid in determining the meaning of the language in either subsection. Subsection 3 is itself unclear.[1] For these reasons, *144 I conclude that it is fruitless to endeavor to determine the meaning of subsections 2 and 3 as well as their interrelationship by a mere textual analysis.
The fundamental guide to the determination of the meaning of a statute is the intention and purpose of the Legislature in adopting such a statute. See, e. g., King Resources Co. v. Environmental Improvement Commission, Me., 270 A.2d 863, 869 (1970). See generally Comment, Statutory Construction, 30 Me.L.Rev. 72 (1978). We have previously noted that our marital property statute is based upon "the fundamental conception of marriage, having its roots in community property law, as a partnership or shared enterprise." Carter v. Carter, Me., 419 A.2d 1018, 1022 (1980); Tibbetts v. Tibbetts, Me., 406 A.2d 70, 76 (1979). In order to effectuate this partnership conception of marriage, subsection 3 creates a statutory rebuttable presumption that property acquired during marriage is marital property without regard to the manner in which title is held. Drawing upon underlying community property concepts upon which our marital property statute is based and in recognition of the principle that each spouse should be able to maintain a separate estate consisting of 1) property brought into the marriage, 2) the increase in value of such property, 3) property excluded by agreement of the parties from the marital estate, 4) property acquired by a spouse by gift, bequest, devise or descent, 5) property acquired in exchange for non-marital property and 6) property acquired by a spouse after the partnership has been terminated by a decree of legal separation, subsection 2 excludes from the definition of marital property and therefore from the operative effect of the statutory rebuttable presumption the kinds of property enumerated above. The underlying purpose of our marital property statute is not furthered by excluding from the operation of the statutory presumption property received by both spouses during marriage by gift, bequest, devise or descent. On the contrary, the partnership concept of marriage is enhanced by a recognition that property acquired jointly by the spouses during marriage by gift, bequest, devise or descent is a part of the marital estate. Of course, this statutory rebuttable presumption may be overcome by evidence demonstrating that the transferor to the spouses had a contrary intention.
The interpretation of the statute here urged is totally consistent with the community property law on which our marital property statute is based. Describing the community estate, Professor de Funiak stated:
It includes the property earned or gained by onerous title by either during the union, as well as that given to both during the marital union. . . . Likewise, property given to one spouse alone, during marriage, is the separate property of that spouse. 1 W. de Funiak, Principles of Community Property § 1 (1943) (emphasis added) (footnote omitted).
The source of these principles was elucidated by Professor de Funiak:
The statute laws of Spain, from the time of the promulgation of the Fuero Juzgo in 693, have explicitly made provision as to property acquired by the spouses during marriage by gift, inheritance, devise or bequest and have been most careful in protecting each spouse in his or her right to have such acquisition as separate property when it was given to such spouse alone. This was fully recognized and thoroughly discussed by the Spanish jurisconsults. Property so acquired was not *145 acquired by labor, skill or industry so as to have been acquired by onerous title and, consequently, shared between spouses.. . . Of course, if the gift, inheritance, devise or bequest was made to both spouses, they both took it as community property; but if it was made to one alone it was the separate property of that spouse. Id. at § 69 (emphasis added) (footnotes omitted).
Since there was no evidence introduced in the Superior Court to overcome the statutory presumption that the property devised to the parties jointly during marriage was marital property, I would affirm the judgment of the Superior Court.
NOTES
[1] 19 M.R.S.A. § 722-A(4) provides in relevant part:
"If both parties to a divorce action also request the court in writing to order disposition of marital property acquired by either or both of the parties to the divorce prior to January 1, 1972, ... the court shall ... order such disposition . . . ."
[2] We disagree, therefore, with the approach of the Missouri Court of Appeals (Kansas City District) in Forsythe v. Forsythe, Mo.App., 558 S.W.2d 675 (1977). We interpret Forsythe v. Forsythe to have taken a position we deem untenable, that "either spouse" includes an acquisition by "both" spouses in joint tenancy for the purpose of determining whether a presumption of marital property has arisen, but that they have the different meaning, of excluding such a joint tenancy acquisition, where they come into play in relation to the functionally interrelated purpose of determining whether the presumption, having come into existence, is overcome.
In this regard, too, we derive little assistance from the analysis of the District of Columbia Court of Appeals in the cases of Turpin v. Turpin, 403 A.2d 1144 (1979) and Hemily v. Hemily, 403 A.2d 1139 (1979), because the language of the Maine statute differs markedly in crucial respects from the District of Columbia Marriage and Divorce Act of 1977.
[3] We thus take the plain language of Section 722-A(2) and (3) to manifest legislative intendment that a title status produced through the instrumentality of a third party by way of "gift, bequest, devise or descent" shall remain unaffected by the subsequent termination of a marriage relationship that happened to exist at the time the title status was created.
[1] 19 M.R.S.A. § 722-A(2) and (3) provide:
2. Definition. For purposes of this section only, "marital property" means all property acquired by either spouse subsequent to the marriage except:
A. Property acquired by gift, bequest, devise or descent;
B. Property acquired in exchange for property acquired prior to the marriage or in exchange for property acquired by gift, bequest, devise or descent;
C. Property acquired by a spouse after a decree of legal separation;
D. Property excluded by valid agreement of the parties; and
E. The increase in value of property acquired prior to the marriage.
3. Acquired subsequent to marriage. All property acquired by either spouse subsequent to the marriage and prior to a decree of legal separation is presumed to be marital property regardless of whether title is held individually or by the spouses in some form of co-ownership such as joint tenancy, tenancy in common, tenancy by the entirety, and community property. The presumption of marital property is overcome by a showing that the property was acquired by a method listed in subsection 2.
The last sentence of subsection 3 unquestionably refers to the five subdivisions of subsection 2. Three of the subdivisions of subsection 2 do not describe "a method" of acquiring property. The first sentence of subsection 3 excludes from the operation of the presumption property acquired subsequent to a decree of legal separation. This exclusion is unnecessary in light of the last sentence of subsection 3 which incorporates the exclusion of subsection 2(C). The point is that the lack of clarity in the drafting makes textual analysis a tenuous basis for discerning the meaning of the statute. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534281/ | 468 S.W.2d 855 (1971)
Clinton Lee ISAAC, Appellant,
v.
The STATE of Texas, Appellee.
No. 43863.
Court of Criminal Appeals of Texas.
June 16, 1971.
Rehearing Denied July 28, 1971.
Bernard & Bernard, Putnam Kaye Reiter, Houston, for appellant.
Carol S. Vance, Dist. Atty., James C. Brough and Thomas C. Dunn, Asst. Dist. Attys., Houston, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ROBERTS, Judge.
This is an appeal from a conviction for murder with malice; trial was before the court and the punishment was assessed at seven years.
The appellant presents four grounds of error, three of which challenge the sufficiency of the evidence to prove murder with malice, and one of which contends that there is no evidence to support the verdict.
The indictment alleged that the appellant, on April 18, 1969, in Harris County, "did with malice aforethought kill Lavern Isaac by shooting her with a gun."
Mahalie Thomas was the first of two witnesses for the State.[1] She testified that on April 18, 1969, she was in her home along with her mother (the deceased), the appellant, and her little sister. The appellant and the deceased were arguing over what bills they were going to pay. She saw the appellant standing in the bedroom holding a pistol in his hand. She went to another room in the house and then she heard three shots. She ran to the bedroom and the appellant said, "I shot your Goddamned mother." The appellant prevented her from using the phone, so she went next door to call the police. When she returned, she found her mother lying on the floor. Her mother's heart was not beating and there was a wound in her forehead.
*856 Officer W. C. Roman of the Houston Police Department was the State's second witness. When he went to the house, he found the appellant, who gave him a pistol and told him that he had shot his wife during an argument.
The appellant took the stand in his own behalf and testified that he and his wife were arguing over whether to pay a car note; that he went into the bedroom and that the deceased came in cussing and saying, "I tell you what you gonna get, you gonna get these .32 bullets, I mean every word," and reached for the gun, which was lying at the head of the bed. There was a struggle for possession of the gun, and finally the gun fired and the deceased fell to the floor. He also testified that the deceased got a gun every time they had an argument and that she had shot him before.
Where controverted issues are raised by the appellant's testimony, and the jury returns a verdict of guilty, such issues pass out of the case with the jury's verdict. Paris v. State, 157 Tex. Crim. 580, 249 S.W.2d 217. It is for the jury to believe or reject any part of the testimony, and this Court will not disturb their verdict where the same is based upon probative evidence. Barry v. State, 165 Tex. Crim. 204, 305 S.W.2d 580; Johnson v. State, Tex.Cr.App., 449 S.W.2d 65. Thus, in considering the sufficiency of the evidence, we must discard the appellant's testimony and determine only if there was probative evidence to sustain the verdict.
In Hill v. State, Tex.Cr.App., 456 S.W.2d 699, the rule was stated as follows:
"The jury is the judge of the facts, the credibility of the witnesses and the weight to be given to their testimony. The jury may accept or reject any portion of the testimony, even that of one witness.
"This Court in determining the sufficiency of the evidence is confined to whether, viewing the evidence in the light most favorable to the prosecution, there is substantial evidence, either direct or circumstantial, which together with reasonable inferences sustains the verdict."
In this case, the judge was the trier of the facts and the same rules apply.
The State's evidence showed, (1) the appellant and the deceased were arguing, (2) the appellant was holding a pistol, (3) three shots were fired, (4) shortly thereafter, the deceased was lying on the floor and her heart was not beating, (5) the appellant said, "I shot your God-damned mother," (6) the appellant prevented Thomas from using the telephone, (7) the appellant gave a police officer the gun and told him that he had killed his wife. This evidence is sufficient to support the judgment of conviction. All of the appellant's contentions are without merit.
The judgment is affirmed.
NOTES
[1] At the time of this offense, her name was Mahalie Crawford. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534448/ | 178 Conn. 606 (1979)
GORIN'S, INC.
v.
BOARD OF TAX REVIEW OF THE TOWN OF WATERBURY
Supreme Court of Connecticut.
Argued June 7, 1979.
Decision released August 7, 1979.
LOISELLE, BOGDANSKI, LONGO, SPEZIALE and PETERS, JS.
Fred B. Rosnick, for the appellant (plaintiff).
James F. Meenan, with whom, on the brief, were Carl R. Cicchetti, Robert P. Spataro and John A. Connelly, for the appellee (defendant).
BOGDANSKI, J.
The plaintiff appealed to the defendant board of tax review from the tax assessments upon certain of its property in the city of Waterbury for the years 1974, 1975 and 1976. When the board refused to reduce the assessments, the plaintiff appealed to the Court of Common Pleas. From the judgment of the court dismissing its appeal, the plaintiff has appealed to this court.
The record reveals that the city's assessor estimated the fair market value of the plaintiff's property *607 to be $364,000, for an assessed value of $227,000; the plaintiff's appraiser valued the property at $138,900, for an assessed value of $90,285.
The trial court concluded from the evidence before it that the plaintiff had failed to sustain its burden of showing an excessive assessment; that the single "comparable sale" relied upon by the plaintiff's appraiser was not an arm's length transaction and did not represent the fair market value of the property; and that the city's assessor had utilized a proper unit value in determining the fair market value. In its assignment of errors, the plaintiff has challenged each of the above conclusions as not supported by the evidence or the facts as set forth in the court's finding.[1] On appeal a trial court's conclusions are tested by the court's finding and cannot be disturbed unless the challenged conclusions are legally or logically inconsistent with the facts found or unless they involve the application of some erroneous rule of law material to the case. Belford v. New Haven, 170 Conn. 46, 55, 364 A.2d 194 (1975).
We note at the outset that the valuation of property for assessment purposes has long been a vexed and much litigated problem, as is indicated by the briefs of the parties in the present case. In this state, the problem has generally been regarded as a question of fact for the trier, provided, of course, that no rule of law has been violated. National *608 Folding Box Co. v. New Haven, 146 Conn. 578, 588, 153 A.2d 420 (1959). This approach is understandable when the safeguards employed in the valuation process are considered. The valuation is first fixed by the assessor; an appeal then lies to the board of tax review. A taxpayer who believes he has been aggrieved by the action of a board of tax review has the further right to appeal to the court pursuant to General Statutes § 12-118, which statute expressly confers upon the court broad discretionary power to grant such relief, whether legal or equitable, "upon such terms and in such manner and form as appear equitable."
In an appeal, as here, from a board of tax review, the court performs a double function. The court must first determine whether the plaintiff has met his burden of establishing that he is, in fact, aggrieved by the action of the board. Only when the court finds that the action of the board will result in the payment of an unjust and, therefore, illegal tax, can the court proceed to exercise its broad discretionary power to grant such relief as is appropriate. National Folding Box Co. v. New Haven, supra, 585; Sibley v. Middlefield, 143 Conn. 100, 106, 120 A.2d 77 (1956); Wilcox v. Madison, 103 Conn. 149, 156, 130 A. 84 (1925). The burden, in the first instance, is upon the plaintiff to show that he has, in fact, been aggrieved by the action of the board in that his property has been overassessed. New Haven Water Co. v. Board of Tax Review, 166 Conn. 232, 234, 348 A.2d 641 (1974).
The issue dispositive of this appeal is thus whether the court's conclusion that the plaintiff failed to sustain its burden of establishing that the assessment of its property was excessive is consistent with the facts set forth in the court's finding.
*609 The court, as previously noted, concluded from the evidence before it that the allegedly "comparable sale" relied upon by the plaintiff's appraiser was not an arm's length transaction and did not therefore represent the fair market value of the property in question.
We note that General Statutes § 12-63 mandates that "[t]he present true and actual value of ... [the] property shall be deemed by all assessors and boards of tax review to be the fair market value thereof and not its value at a forced or auction sale." In its finding the court expressly states that "[t]he property ... shall be assessed at fair market value and not at a value realized from a forced or bid sale"; that "[t]he market approach to value consists in analyzing and collecting information concerning sales of comparable properties... , making allowances for any dissimilarities, considering present market conditions and future market trends to arrive at fair market value"; and that "[t]he plaintiff's appraiser relied on one sale which the court finds not to be a comparable sale."[2] (Emphasis added.)
The above facts, as found by the court, are adequately supported by the evidence in the record and are more than sufficient to sustain the court's conclusion *610 that the plaintiff had failed to sustain its burden of establishing that the action of the board will result in the payment of an excessive and therefore illegal tax.
There is no error.
In this opinion the other judges concurred.
NOTES
[1] The plaintiff has assigned error in the refusal of the court to find that the value of the property on the reproduction less depreciation method is $138,200 as an admitted or undisputed fact. To secure such an addition to the finding the plaintiff must point to its appendix, pleadings or exhibits properly before the court which disclose that the fact in question was admitted or that its truth was undisputed. Brauer v. Freccia, 159 Conn. 289, 290, 268 A.2d 645 (1970). There is nothing in the record to support this claim.
[2] As to this finding, the evidence printed in the appendix reveals the following testimony by the plaintiff's appraiser: "Mr. Gaber, you did use what approach? A. The market value approach. Q. All right. And is it customary to go out and obtain what we call comparables in the particular area in order to reach a conclusion as to a fair market value? A. As close as possible, yes.... The Court: Before you rest, let me ask you [this] question .... On this sale that you have, is it comparable, was that an arm's length sale? The Witness: No, sir. That was by bid and the Connecticut the Colonial Bank & Trust Company and they were the highest bidders." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534460/ | 468 S.W.2d 90 (1971)
Eugene THOMAS, Appellant,
v.
The STATE of Texas, Appellee.
No. 43945.
Court of Criminal Appeals of Texas.
June 16, 1971.
David J. Nagle of Nagle & Barr, Houston, for appellant.
Carol S. Vance, Dist. Atty., Phyllis Bell and Jack Bodiford, Asst. Dist. Attys., Houston, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ONION, Presiding Judge.
This appeal arises out of a conviction for robbery by assault where punishment was assessed at 25 years.
Appellant's brief presents the following three questions:
"1. Was Defendant so prejudiced by the admission of the testimony of offenses not connected to him, that he was denied a fair trial?
"2. Did the Trial Court err in admitting evidence of extraneous offenses, *91 over defense Motion, even though limited by the charge to the question of `identity'?
"3. Did the Trial Court err in letting the State argue, outside the record, that Appellant was arrested because of a police chase of two cars which each had been involved in unlawful activity not connected to Appellant?"
Patsy Turman, an employee of the Pilgrims Cleaners at 6929 Jensen in the city of Houston, testified that on May 14, 1969, the appellant and a man named Jones entered such business establishment, asked for some cleaning in the name of Smith, then pulled a gun and forced her to give him an unknown amount of money which she surrendered because of fear for her life or serious bodily injury. The appellant then caused Mrs. Turman and Peggy Phillips, another employee, to lie on the floor while he and his companion departed.
Mrs. Turman related that some two weeks later, the exact date of which she could not recall, a man whom she later learned to be one McGrew entered the business establishment and asked for cleaning in the name of Smith. At this time she saw the appellant walk up to the front door and she fled through the rear door to a nearby wrecker service.
Mrs. Phillips corroborated Mrs. Turman's testimony as to the events of May 14th and made a positive identification of the appellant.
D. R. Miller, owner of the wrecker service, testified that it was on June 6, 1969, that Patsy Turman came into his storage yard, appeared nervous, and frightened, and reported that the man who had robbed her earlier had returned. Miller then drove a wrecker truck onto Jensen Street where he saw two men "coming from the cleaners" and observed them get into an orange Road Runner automobile. He broadcasted on the wrecker's radio a description of the car and its license number to his dispatcher who was in contact with the police. He lost the Road Runner in the traffic, but some 15 to 30 minutes later had occasion to see the automobile after it had been stopped by the police.
Frank McCarty, an employee of Miller's, who was driving a wrecker, heard the broadcast and spotted the described Road Runner containing four persons. He followed. He saw the car stop and two men, whom he was unable to identify, get out and enter a black Chevrolet. He reported a description of the Chevrolet and its license number to the police. He continued to follow the Road Runner and when it was parked, he reported its location to Officer Terpstra who subsequently apprehended McGrew and another man in the Road Runner. The appellant was not present.
The next day, June 7th, McCarty again saw the black Chevrolet and reported it to the police. Officer Collie and his partner apprehended the two Hudson brothers in the Chevrolet. After a conversation with such individuals Collie testified he arrested the appellant at his home.
In his first ground of error the appellant has failed to specify what testimony of offenses not connected to him deprived him of a fair trial. His ground of error certainly does not comply with the requirements of Article 40.09, Sec. 9, Vernon's Ann.C.C.P.
This Court, with its heavy caseload, should not be compelled to search through a record while speculating just what evidence the appellant might have in mind. McElroy v. State, Tex.Cr.App., 455 S.W.2d 223. Nothing is presented for review.
If it be offenses growing out of the "cops and robbers" chase of the two automobiles, then we observe that the appellant elicited from McCarty that he had seen the red or orange Road Runner driving on the wrong side of the road, and first elicited from Officer Terpstra on cross-examination that the reason he stopped the Road Runner on June 6th was a report that it *92 had been used in a robbery the day before. It was also the appellant's counsel who elicited from Officer Collie in the jury's presence that the appellant had been arrested by virtue of an arrest warrant based on "a serious threat to take a life."
Appellant's second ground appears to relate to the failure of the trial court to grant his motion to strike the testimony of Miller, McCarty and Collie. This motion was made the day after these witnesses had testified and had been thoroughly cross examined. The motion was made without specification of the portions sought to be excluded. Clearly appellant's contention that all of such testimony was immaterial and irrelevant and involved extraneous offenses is without merit, and appellant is in no position to complain of that testimony he himself developed, particularly as to the extraneous offenses. See Mays v. State, Tex.Cr.App., 428 S.W.2d 325; Rogers v. State, Tex.Cr.App., 420 S.W.2d 714.
Appellant's last ground of error relates to jury argument.
The prosecutor's argument was:
"Now, Mr. Nagle quarrels with me because the testimony of the officers that led to Eugene Thomas, he thought was immaterial. Had I not done so, the question in your mind would be, `Well, how is he here? What happened What led to his arrest?' That's why you heard that testimony. It just led in sequence of events to Eugene Thomas."
Appellant objected on the ground that such argument was "prejudicial and untrue." He moved at this point to "open the testimony and let the jury know the full facts of the warrant for his arrest."
The objection was overruled. No further relief was requested.
First, we observe that the argument, if any way improper, was invited by the earlier defense counsel's argument that the appellant was not arrested because of anything to do with the instant charge, but that counsel was "not allowed to tell you about the facts that were there or that it's long since dismissed or anything about it at all * * *."
Further, we note that the testimony referred to by the prosecutor had been admitted into evidence under the rulings of the court and the prosecutor certainly had a right to refer thereto in his argument. In addition, it was the appellant who had elicited testimony that his arrest was based upon an arrest warrant.
Appellant also complains of the prosecutor's reference in argument to the effect that the Road Runner led to appellant's downfall and that such automobile "was not a stranger to the police." To such argument, there was no objection or other request for relief. Nothing is presented for review. See Thurmond v. State, Tex.Cr.App., 441 S.W.2d 528. It should also be remembered that appellant elicited the evidence that the police had been searching for such Road Runner.
The judgment is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534442/ | 47 Md. App. 627 (1981)
424 A.2d 1118
LISA MARIE STEVENS, INFANT, ETC.
v.
UNION MEMORIAL HOSPITAL ET AL.
No. 676, September Term, 1980.
Court of Special Appeals of Maryland.
Decided February 5, 1981.
The cause was argued before GILBERT, C.J., and MOORE and LOWE, JJ.
Marian V. Fleming, with whom were Henry E. Dugan, Jr., Jerome J. Seidenman and Seidenman & Dugan, P.A. on the brief, for appellants.
Alva P. Weaver, III, with whom were Lord, Whip, *628 Coughlan & Green, P.A. on the brief, for appellee Union Memorial Hospital. John F. King, with whom were Angus R. Everton and Anderson, Coe & King on the brief, for appellee Jerrie Cherry M.D. M. King Hill, Jr., with whom were John R. Penhallegon and Smith, Somerville & Case on the brief, for appellee K.F. Rashad, M.D.
GILBERT, C.J., delivered the opinion of the Court.
This appeal seeks to make res ipsa loquitur viable in an alleged medical malpractice case. We are asked by the infant appellant, Lisa Marie Stevens, to hold that res ipsa loquitur has a place in medical malpractice claims, notwithstanding prior decisions by the Court of Appeals and this Court to the contrary.
THE FACTS
The backdrop for this appeal, as disclosed by the record, is that Lisa, then age six, was admitted to the Union Memorial Hospital in Baltimore City on November 19, 1975, for the surgical excision of her tonsils and adenoids. Lisa's surgeon was Dr. Jerrie Cherry. Lisa's mother accompanied the child to the doors of the operating room and, according to the mother, Lisa had no marks or scars on her face at that time. The anesthesiologist, Dr. Karim F. Rashad, did not recall seeing any marks on Lisa's face prior to the operation. The only other persons present in the operating room in addition to Doctors Cherry and Rashad were a scrub technician and a circulating nurse.
A mask was placed over Lisa's mouth, and the anesthesia was administered. Before the actual surgery, the mask was removed, and no marks were observed by Dr. Rashad on the child's face. Upon removal of a mouth gag that had been employed to facilitate access to Lisa's throat, she was discovered to have two blisters on her face. The blebs ruptured. Upon healing, noticeable scars remained. The evidence showed that an electrocauterizer was used by Dr. *629 Cherry during the operation.[1] The scars were claimed in the suit to be a source of anxiety and to cause emotional suffering to the young girl.
Lisa's attorneys were cognizant to the fact that the child was unconscious during the operation and, thus, unable to relate the events that produced the blisters which resulted in the scarring. Moreover, they did not produce an expert witness who might have opined that the scars were a direct result of negligent treatment.
On oral argument, we were advised that the two nurses, who were present at the time of the operation, had not been deposed by the appellants. Moreover, neither nurse was called as a witness in the case.
We think a clear inference may be drawn from the manner in which the case was presented that the appellants attempted to mold the facts so as to fit within the framework of the doctrine of res ipsa loquitur. There is an equally pellucid inference that the appellants' counsel sought to arm themselves for a frontal attack on the Maryland appellate precedent proscribing res ipsa loquitur in medical malpractice suits.[2]
The case was presented to the trial judge and jury on the basis of the testimony of Lisa's mother, excerpts from the depositions of Doctors Cherry and Rashad, and the in-court testimony of Lisa, herself.
At the conclusion of Lisa's case, the appellees, Union Memorial, Dr. Cherry, and Dr. Rashad, all moved for a directed verdict on the ground that Lisa had not proven prima facie negligence on their part, and that res ipsa *630 loquitur did not apply to a medical malpractice claim. In granting the motions, the trial judge commented:
"Everything that Plaintiff's Counsel argues here, very forcefully in my judgment, sets forth what is a substantial difference of opinion that other jurisdictions have with Maryland over the applicability of the doctrine of Res ipsa in situations such as we find here, but at this date, as far as I can determine from my study of the subject, it is not the law of Maryland."
RES IPSA LOQUITUR
The doctrine of res ipsa loquitur is actually a rule of evidence invented by the English courts[3] in order to permit the plaintiff in a negligence action to establish a prima facie case of negligence when he could not otherwise satisfy the traditional requirements of negligence. The rule thereby avoided a directed verdict in favor of the defendant and enabled the case to go to the jury for its deliberation. Res ipsa loquitur was originally associated with falling objects,[4] and is grounded on the inference that the injury would not have occurred absent someone's negligence. The justification for this special rule of evidence is "found in the circumstance that the principal evidence of the true cause of the accident is accessible to the defendant, but inaccessible to the victim of the accident." Potts v. Armour & Co., 183 Md. 483, 488, 39 A.2d 552, 555 (1944). The rule is not applicable when it can be inferred from ordinary experience that the accident might have happened without any fault of the defendant. Id.
Under the law of this State, the following prerequisites must be fulfilled before res ipsa loquitur may be invoked:
*631 1) The injury is of a nature that would not ordinarily occur in the absence of negligence;
2) The defendant had exclusive control of the instrument which caused the injury; and
3) The plaintiff did not contribute to the injury.
See Blankenship v. Wagner, 261 Md. 37, 273 A.2d 412 (1971); Chesapeake & Potomac Telephone Co. v. Hicks, 25 Md. App. 503, 337 A.2d 744 (1975); United States v. Chesapeake Delaware Shipyard, Inc., 369 F. Supp. 714 (D.C. Md. 1974).
Despite the efforts of the appellants to assail the ramparts of Sard v. Hardy, supra, and others, note 2, supra, their assault must be turned back because this is not a bona fide case of res ipsa loquitur. Indeed, it is simply a case of alleged, but unproven, medical malpractice clad in the costume of res ipsa loquitur.
We reach that conclusion because of the appellants' failure to meet the three criteria needed to invoke the doctrine upon which they seek to rely. If we assume arguendo that the appellants have satisfied the first and third prongs of the three-tined test set out above, they, nevertheless, have not sated the second prong. There is no proof that the appellees had exclusive control of the instrument which caused the injury. Although neither of the two nurses was joined as defendants in the suit, or deposed, or served written interrogatories, either or both of the nurses may have been the person or persons responsible for the injury to Lisa. We cannot assume that of the four persons present in the operating room that only one or two of them or the hospital itself is the responsible party or parties.
Appellants may not, as they have tried to do in this case, exclude possible parties defendant, and selectively tailor their discovery in order to invoke res ipsa loquitur. The appellants, had they deposed the two nurses, may have discovered the "true cause of the accident."
Furthermore, Potts flatly holds that the rule of res ipsa loquitur is not available to a plaintiff when "it can be *632 inferred from ordinary experience that the accident might have happened without the fault of the defendant." Id. at 488, 39 A.2d at 555.
The facts of the instant case give rise to a rational inference, founded on ordinary experience, that when four persons other than the victim are in attendance at the happening of an accident, any one or more of the four may have caused the accident.
We think the appellants are in the position of proving too much and too little: too much for the application of res ipsa loquitur to the facts,[5] and too little for a finding of ordinary negligence.
Judgment affirmed.
Costs to be paid by appellants.
NOTES
[1] A method of cauterizing tissue through the use of a platinum wire heated by a current of electricity. Steadman's Medical Dictionary 3d (1972).
[2] See, e.g., Sard v. Hardy, 281 Md. 432, 379 A.2d 1014 (1977); Nolan v. Dillon, 261 Md. 516, 276 A.2d 36 (1971); Johns Hopkins Hospital v. Genda, 255 Md. 616, 258 A.2d 595 (1969); State, Use of Solomon v. Fishel, 228 Md. 189, 179 A.2d 349 (1962); Lane v. Calvert, 215 Md. 457, 138 A.2d 902 (1958); Bettigole v. Diener, 210 Md. 537, 124 A.2d 265 (1956); State, Use of Kalives v. Baltimore Eye, Ear and Throat Hospital, Inc., 177 Md. 517, 10 A.2d 612 (1940); Fink v. Steele, 166 Md. 354, 171 A. 49 (1934); McClees v. Cohen, 158 Md. 60, 148 A. 124 (1930); Angulo v. Hallar, 137 Md. 227, 112 A. 179 (1920); Riffey v. Tonder, 36 Md. App. 633, 375 A.2d 1138 (1977); Hans v. Franklin Square Hospital, 29 Md. App. 329, 347 A.2d 905 (1975); Raitt v. Johns Hopkins Hospital, 22 Md. App. 196, 322 A.2d 548 (1974).
[3] Byrne v. Boadle, 2 H.C. 722, 159 Eng. Rep. 299 (1863).
[4] In Byrne v. Boadle, id., the plaintiff's injury was sustained after a barrel of flour rolled out of a warehouse window, striking him as he was walking past.
[5] We are not to be understood as refusing to sanction the application of the doctrine of res ipsa loquitur to medical malpractice cases. The question of whether the prior holdings of the Court of Appeals and this Court are still viable will have to await another day. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2857762/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-92-370-CR
JACK WILBURN DELONEY,
APPELLANT
vs.
THE STATE OF TEXAS,
APPELLEE
FROM THE DISTRICT COURT OF CALDWELL COUNTY, 22ND JUDICIAL DISTRICT
NO. 90-242, HONORABLE CHARLES R. RAMSAY, JUDGE
PER CURIAM
This is an appeal from a judgment of conviction for attempted murder. Punishment
was assessed at confinement for 20 years.
Appellant and the State have filed a joint motion to withdraw the appeal. No
decision of this Court has been delivered. The motion is granted and the appeal is dismissed. See
Tex. R. App. P. Ann. 59(b) (Pamph. 1992).
[Before Chief Justice Carroll, Justices Aboussie and B. A. Smith; Justice Aboussie
not participating]
Dismissed On Joint Motion
Filed: August 12, 1992
[Do Not Publish]
August 12, 1992
Mr. Douglas D. Behrendt
130 E. San Antonio
San Marcos, Texas 78666
Honorable Charles R. Kimbrough
Criminal District Attorney
Caldwell County Courthouse
P. O. Box 869
Lockhart, Texas 78644
Re: No. 3-92-370-CR--Jack Wilburn Deloney v.
The State of Texas
(t/c no. 90-242)
Counsel:
In accordance with Rule 91, Texas Rules of Appellate Procedure, enclosed is a copy of the
opinion and judgment handed down by this Court on this date in the above cause.
The Court's mandate has been issued this date to the clerk of the trial court under separate cover.
Very truly yours,
W. KENNETH LAW, CLERK
By
Ora Aranda, Deputy
Enclosures
xc: State Prosecuting Attorney
Clerk, Court of Criminal Appeals
Honorable Charles R. Ramsay, District Judge
Ms. Emma Jean Schulle, District Clerk
MR. DOUGLAS D. BEHRENDT
130 E. SAN ANTONIO
SAN MARCOS TX 78666
HONORABLE CHARLES R. KIMBROUGH
CRIMINAL DISTRICT ATTORNEY
CALDWELL COUNTY COURTHOUSE
P. O. BOX 869
LOCKHART TX 78644
HONORABLE CHARLES R RAMSAY
JUDGE PRESIDING
22ND JUDICIAL DISTRICT COURT
CALDWELL COUNTY COURTHOUSE
LOCKHART TX 78644
MRS EMMA JEAN SCHULLE
DISTRICT CLERK
CALDWELL COUNTY COURTHOUSE
P O BOX 749
LOCKHART TX 78644
TRIAL COURT NO. 90-242
THE STATE OF TEXAS.
TO THE 22ND DISTRICT COURT of CALDWELL COUNTY - GREETINGS:
Before our COURT OF APPEALS, on the 12th of August A.D. 1992, the cause upon appeal to
revise or reverse your Judgment between
JACK WILBURN DELONEY, Appellant,
No. 3-92-370-CR vs.
THE STATE OF TEXAS, Appellee,
was determined; and therein our said COURT OF APPEALS made its orders in these words:
THIS CAUSE came on to be heard on joint motion of appellant and the State to withdraw the appeal and
the same being considered, because it is the opinion of this Court that the same should be granted: it is
ORDERED, ADJUDGED and DECREED by the Court that appellant be allowed to withdraw notice of
appeal and that the appeal be dismissed; and it appearing that the appellant is indigent and unable to pay
costs, that no adjudication as to costs is made; and that this decision be certified below for observance.
WHEREFORE, We command you to observe the order of said COURT OF APPEALS in this
behalf and in all things have it duly recognized, obeyed and executed.
WITNESS the HONORABLE JIMMY CARROLL, Chief Justice
of our said COURT OF APPEALS for the Third District of Texas,
with the seal thereof annexed, at the City of Austin, this the 12th
day of August A.D. 1992.
W. KENNETH LAW, CLERK
By: , Deputy
Ora Aranda
August 12, 1992
Mrs. Emma Jean Schulle
District Clerk
Caldwell County Courthouse
P. O. Box 749
Lockhart, Texas 78644
Re: No. 3-92-370-CR--Jack Wilburn Deloney v. State of
Texas
(t/c no. 90-242)
Dear Mrs. Schulle:
Enclosed, with reference to the above cause, is the mandate of this Court. Please acknowledge
your receipt of same by returning the enclosed card to this office, appropriately completed.
Your cooperation in this regard is appreciated.
Very truly yours,
W. KENNETH LAW, CLERK
by
Ora Aranda, Deputy
Enclosures to Clerk
xc: Mr. Douglas D. Behrendt
Honorable Charles R. Kimbrough
IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
JUDGMENT RENDERED AUGUST 12, 1992
NO. 3-92-370-CR
JACK WILBURN DELONEY V. THE STATE OF TEXAS
APPEAL FROM 22ND DISTRICT COURT OF CALDWELL COUNTY
BEFORE CHIEF JUSTICE CARROLL, JUSTICES ABOUSSIE AND B. A. SMITH;
JUSTICE ABOUSSIE NOT PARTICIPATING
DISMISSED ON JOINT MOTION -- PER CURIAM OPINION
THIS CAUSE came on to be heard on joint motion of appellant and the State to withdraw the
appeal and the same being considered, because it is the opinion of this Court that the same should
be granted: it is ORDERED, ADJUDGED and DECREED by the Court that appellant be allowed
to withdraw notice of appeal and that the appeal be dismissed; and it appearing that the appellant
is indigent and unable to pay costs, that no adjudication as to costs is made; and that this decision
be certified below for observance. | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1534222/ | 468 S.W.2d 75 (1971)
Roberto Rodriquez AGUILAR, Appellant,
v.
The STATE of Texas, Appellee.
No. 44145.
Court of Criminal Appeals of Texas.
June 16, 1971.
*76 Thomas V. Priolo, Amarillo, for appellant.
Tom Curtis, Dist. Atty. and Hugh Russell, Asst. Dist. Atty., Amarillo, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ODOM, Judge.
This is an appeal from a conviction for assault with intent to murder with malice aforethought; the punishment, twenty-five years.
As his first ground of error, appellant contends the evidence is insufficient to support the jury's verdict.
Juan Bustos testified that on September 27, 1969, he and the appellant went out into the country and spent about two hours shooting his .22 pistol; that they had been drinking throughout the afternoon. He stated that the appellant asked him if he could purchase the gun, and that he later delivered possession of the said gun to the appellant. They returned to Amarillo at approximately 8:30 P.M. and went to the Longhorn Bar. Jesus Kiros Valadez was at the bar and he and appellant exchanged greetings, whereupon appellant told him "somebody was going to shoot" him. Then Valadez stated: "If somebody going to shoot me, that's all right, I'm here." Valadez turned from appellant, began drinking beer, and was shot twice in the back. Appellant and Bustos immediately fled from the bar, going in different directions, pursued by bar patrons and employees. Numerous individuals were present at the time of the shooting, but only one testified that she actually saw appellant with a pistol.
*77 The record reflects the following testimony by Market Sally Ray:
"Q. Were you working there on the 27th of September of 1969, the night which there was a shooting?
"A. Yes, I was.
"Q. Did you see the shooting?
"A. Yes.
* * * * * *
"Q. Now, at this time were you able to see the gun?
"A. No, becausewell, before it went off, I did; but afterwards I was in a state of shock and I looked down and took off running.
"Q. How many shots were fired?
"A. I don't know right now; I know it was more than two. I'm not sure.
"Q. All right. Now, did you chase the men?
"A. Yeah, we took off after them and we just saw this one run to the car and he couldn't make it in the car and he started running off catty-cornered from the Longhorn. We didn't see the sight of the other one, I don't know which direction
"Q. Were you able to catch that man?
"A. Luiz is the one that caught him.
"Q. Now, was the one you caught the same one that Carmen Baca helped catch? (Referring to Bustos)
"A. Yeah, we were all bunched up.
"Q. Now, was the one you and Carmen Baca caught of the two men, was this the same man that had done the shooting, or was it the man that had not done the shooting?
"A. He was the one that didn't do the shooting. (Emphasis supplied)
* * * * * *
Well he's the one I saw with the gun when the gun went off, the other man." (Referring to appellant)
We conclude that the testimony of the eye witness alone was sufficient to support the jury's verdict. See Lopez v. State, 172 Tex.Cr.R., 356 S.W.2d 674. Further, under this testimony, the failure of the court to charge on circumstantial evidence was not error. This was brought as ground of error number four. See Lane v. State, 162 Tex. Crim. 305, 284 S.W.2d 723.
Appellant's first and fourth grounds of error are overruled.
The second and third grounds of error are that the evidence is insufficient to support a conviction for assault with intent to murder with malice as there is no evidence of malice between the appellant and the assaulted party and no apparent motive.
The court charged the jury on malice.
Malice may be inferred from the circumstances and does not require any specific length of time for germination or growth, but may arise at any instant or immediately. Haynes v. State, 167 Tex.Cr. R. 68, 317 S.W.2d 945; Hernandez v. State, 157 Tex. Crim. 112, 247 S.W.2d 260; Oliver v. State, 155 Tex. Crim. 461, 236 S.W.2d 143; Morse v. State, 154 Tex. Crim. 561, 229 S.W.2d 376; Jones v. State, 153 Tex. Crim. 345, 220 S.W.2d 156; Harvey v. State, 150 Tex. Crim. 332, 201 S.W.2d 42.
The intentional shooting of one with a pistol is sufficient to authorize the jury to find that the shooting was actuated by malice. Sloan v. State, Tex.Cr.App., 409 S.W.2d 412; Peterson v. State, Tex.Cr. App., 399 S.W.2d 813; Stewart v. State 168 Tex. Crim. 166, 324 S.W.2d 228, cert. denied 363 U.S. 815, 80 S. Ct. 1253, 4 L. Ed. 2d 1155. See also Bell v. State, Tex.Cr.App., 398 S.W.2d 133; Beasley v. State, 171 Tex. Crim. 115, 346 S.W.2d 123.
*78 Motive is not essential in order for malice to exist. Holland v. State, Tex.Cr. App., 216 S.W.2d 228.
Appellant's second and third grounds of error are overruled.
Appellant's fifth ground of error alleges that the trial court commented on the weight of the evidence by "over-emphasizing, by repetition and example, the assault with intent to murder with malice aspect of the case * * *."
We note that the charge is in substantial compliance with that set out in 4 Branch's Ann.P.C.2d, Section 1850.1.
Ground of error number five is overruled.
By his sixth ground of error, appellant alleges the trial court's granting of a state's motion for continuance to procure a missing subpoenaed witness was prejudicial error, as the state then produced an unsubpoenaed witness. The record reflects the following testimony:
"MR. REESE (State's Attorney): In that regard, I can only offer the court my best understanding that even a relatively short delay is likely to produce Mr. Gallegos, although we have no knowledge of his whereabouts, because we are so surprised.
"THE COURT: Mr. Reese, the motion for a continuance to another term or another week will, of course, be denied. It is now 3:15 in the afternoon, and we will recess the trial until 9:30 in the morning."
Article 29.13, Vernon's Ann.C.C.P., provides:
"A continuance or postponement may be granted on the motion of the State or defendant after the trial has begun, when it is made to appear to the satisfaction of the court that by some unexpected occurrence since the trial began, which no reasonable diligence could have anticipated, the applicant is so taken by surprise that a fair trial cannot be had."
Continuance is a matter within the sound discretion of the trial judge, and we find no abuse of such. Appellant's sixth ground of error is overruled.
Appellant's seventh ground of error alleges that all available state's witnesses present at the time of the shooting should have been called to testify.
This court, in Escamilla v. State, Tex.Cr. App., 464 S.W.2d 840, at 841, speaking through Judge Roberts, stated:
"An examination of the record shows a sufficiency of the evidence at the time the State rested. There is no rule that requires the State to call all witnesses subpoenaed. It is only necessary that the proof be present. Kidwell v. State, 35 Tex. Crim. 264, 33 S.W. 342; Trotter v. State, 37 Tex. Crim. 468, 36 S.W. 278; McGrew v. State, Tex.Cr.App., 47 S.W. 226."
In the case at bar, unlike Escamilla v. State, supra, the alleged absent witnesses were not even subpoenaed.
Ground of error number seven is overruled.
By his eighth ground of error appellant contends that the trial court abused its discretion by denying his application to take depositions. The record reflects that the said motion was filed on the day of trial. The transcription of the court reporter's notes reveals the following:
"THE COURT: I have before me the motions filed by the Defendant to take the depositions of certain witnesses, and an objection to the Indictment. Let the record reflect that these instruments were filed with the Court at 9:30 a.m. on Wednesday, July 22nd, 1970. Let the record further reflect that at the docket call on Monday morning, both the State and the Defendant announced ready for this trial. The motions will be overruled.
"MR. PRIOLO: Note our exception.
"(A jury was duly impaneled.)"
*79 Article 39.02, V.A.C.C.P., provides for the taking of depositions of witnesses and the trial court has wide discretion in either granting or denying an application. Under the facts of this case no abuse of discretion is shown. See Langston v. State, Tex.Cr.App., 416 S.W.2d 821.
There being no reversible error, the judgment is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534220/ | 468 S.W.2d 693 (1971)
STATE of Missouri, ex rel. LACLEDE GAS COMPANY, Relator,
v.
Honorable Michael F. GODFREY, Judge of the Twenty-Second Judicial Circuit of the State of Missouri, and as such, Judge of the Circuit Court of the City of St. Louis, Missouri, Respondent.
No. 33845.
St. Louis Court of Appeals, Missouri.
May 25, 1971.
*695 M. E. Stokes, St. Louis, for relator.
Walter J. Gelber, Clayton, Adolph K. Schwartz, Robert R. Schwarz, Luke, Cunliff, Wilson, Herr, Chavaux & McCluggage, Tom Mendelson, St. Louis, for respondent.
DOWD, Judge.
A third party practice case. In this original prohibition, relator Laclede Gas Company seeks to prevent respondent, as Judge of the Circuit Court of the City of Saint Louis from allegedly exceeding his jurisdiction by entering an order denying the motion of relator to file a third party petition joining as third party defendant the Ace Sales Company (hereinafter Ace). This motion was in the case of Allen Goodwin and Helen Goodwin, plaintiffs v. Laclede Gas Company, Vernon Rusert, Robert Baum and Robert Douglas, d/b/a Weco Company, defendants. Rusert, Baum and Douglas are owners of the building where the injury occurred. The court sustained the motion to intervene filed by Providence Washington Insurance Company, the workmen's compensation insurer of Ace.
In plaintiffs' second amended petition it is alleged that Allen Goodwin, an employee of Ace, was injured in a natural gas fire and explosion in a building occupied by Ace. Plaintiffs allege numerous allegations of negligence against defendant Rusert, d/b/a Weco Company, and Laclede. Included in the allegations of negligence contained in paragraph 7 against Rusert are the following:
"a) In that in constructing, installing and repairing the overhead gas heater on the first floor of defendant's premises, they did such work in a careless, negligent, unsafe, improper, inexperienced and unworkmanlike manner;
* * * * * *
"c) In that he permitted, caused and suffered said gas boilers, water heater, *696 and gas pipes connected thereto and leading into the other floors of said building and overhead heating units within said building to be and remain in a broken, defective, dangerous and unsafe condition;
* * * * * *
"e) In that he created said dangerous, defective and unsafe condition of said boilers, water heater and gas pipes connected thereto and leading into other parts of said building and overhanging heating units on the first floor of said building;
* * * * * *
"g) In that he hired negligent and inexperienced persons to inspect, repair and service said gas boiler and water heater and gas pipes connected thereto in said basement;
"h) In that he hired negligent and inexperienced persons to repair, replace and install overhanging gas units within said building."
Included in plaintiffs' allegations of negligence contained in paragraph 6 against Laclede are the following:
"c) That it negligently and carelessly failed to maintain, inspect and service said gas meters, pressure regulatros (sic) and the various valves, cocks, fittings, pipes and lines through which the gas flowed and the gas mains and gas lines adjacent to said building;
* * * * * *
"f) That it failed to exercise due care and proper care in and about the making of careful, prudent and adequate inspection of the premises, gas meters, pressure regulators, valves, cocks, fittings, pipes, gas mains and gas lines after being notified and having knowledge of said gas leakage, gas odors and gas seepage into said building, in failing to prevent said gas from leaking, escaping, seeping into and accumulating in and about said building after notice of said gas leakage and seepage; * * *."
The defendant Rusert filed a cross-claim against Laclede in which he sought $85,000 damages for loss of the building and indemnity on the theory that if he were liable to plaintiffs, he would "only be secondarily liable" and Laclede "would be primarily liable."
Laclede then filed a motion to join as additional parties defendant Rusert's co-owners of the building, Baum and Douglas. Also filed at that time was Laclede's cross-claim against Rusert and the proposed additional defendants Baum and Douglas, seeking indemnity from them. This cross-claim was based on the theory that if Laclede were liable to plaintiffs, the building-owner defendants (Rusert, Baum and Douglas) were obligated to indemnify Laclede for such liability because any negligence on the part of the building-owner defendants would be primary or active negligence whereas any negligence on the part of Laclede would be secondary or passive. This cross-claim was also based on the additional theory that the building-owner defendants had agreed with Laclede to keep their gas facilities within the building (those not belonging to Laclede) in safe operating condition. The court sustained Laclede's motion to add Baum and Douglas as additional parties defendant on the cross-claim of Laclede seeking indemnity from the building owners.
At the time that Laclede filed its cross-claim against the building-owner defendants, it filed a motion for leave to file a third party petition adding as a third party defendant Ace which occupied the premises damaged by the fire. This third party petition was also based on the theory that if Laclede were liable to plaintiffs, Ace was obligated to indemnify Laclede for such liability because any negligence on the part of Ace would be active and primary negligence whereas any negligence of Laclede would be passive or secondary. The third party petition was also based on the theory *697 that as a condition to initiating and continuing gas services to the premises, the proposed third party defendant agreed to maintain its facilities in safe operating condition. The court announced its intention to deny Laclede's motion for leave to file this third party petition. The court did not state the reason for its prospective denial of relator's application for leave to file its third party petition. We issued the preliminary writ.
The authority for instituting a third party action is found in Civil Rule 52.10, V. A.M.R. This rule provides defendant may after his answer has been filed, upon notice to plaintiff, apply to the court "* * * for leave as a third-party plaintiff to serve a summons and petition upon a person not a party to the action who is or may be liable to him for all or part of the plaintiff's claim against him. * * *" Rule 14 of the Federal Rules of Civil Procedure is substantially the same as Civil Rule 52.10.
One of the tests of the propriety of a third party impleader is whether there is a right of indemnification present. Hipp v. Kansas City Public Service Co., Mo. App., 237 S.W.2d 928, 931 [4].
To determine whether a case for indemnity exists we look to the allegations of the plaintiffs' second amended petition and the third party petition. If from those allegations some possibility of liability over appears, the third party petition should be permitted. State ex rel. Siegel v. McLaughlin, Mo.App., 315 S.W.2d 499, 502[1]. "The area in which a party held liable for negligence may secure indemnity from another party also negligent is closely circumscribed. It embraces a group of special situations and relationships where it has seemed reasonable and desirable to impose the ultimate responsibility on the person found to have played the active or primary role in the negligent situation in favor of one also held liable, but whose part in the event is passive or secondary. In such situations the parties are said not to be in pari delicto." State ex rel. Siegel v. McLaughlin, supra, [2].[1]
*698 The basis for indemnification is dependent on the character of the negligence rather than the difference in the degrees of the negligence. Crouch v. Tourtelot, Mo., 350 S.W.2d 799. Our Supreme Court in Barb v. Farmers Insurance Exchange, Mo., 281 S.W.2d 297, 304, stated: "It is the general rule, where one person has been exposed to liability and compelled to pay damages on account of the negligence of another, the first has a right of action against the other for indemnity where the parties are not in pari delicto." (Emphasis theirs). Said another way, the principle of indemnification applies where one party creates the condition which causes injury and the other does not join therein but is exposed to liability on account of it. The negligence of the party responsible for the dangerous condition is active and primary while the negligence of the other is passive and secondary. Kansas City Southern Ry. Co. v. Payway Feed Mills, Inc., Mo., 338 S.W.2d 1, 5.
Likewise, in Woods v. Juvenile Shoe Corporation of America, Mo., 361 S.W.2d 694, a retailer was permitted to file a cross-claim for indemnity against a manufacturer of a pair of shoes on the theory that the manufacturer was guilty of active negligence in creating a dangerous condition; (i. e., making a pair of shoes with a tack protruding into the inside of the shoe) and the retailer was only passively negligent in failing to discover and correct this condition.
It is evident that plaintiffs' second amended petition contains allegations of active negligence on the part of Rusert and passive negligence on the part of Laclede. In paragraph 7(e) of this petition Rusert is specifically charged with creating the dangerous condition which is an allegation of active negligence. The other allegations [7(a), (c), (g), and (h)] set out in the opinion are also charges of active negligence against Rusert. The allegations of passive negligence against Laclede are set out in paragraphs 6(c) and (f). In substance, these allegations charged Laclede with the failure to inspect and discover the condition and the failure to correct the condition. Also, Laclede's third party petition contains a charge of active negligence against Ace. On the proof of such allegations Laclede would be entitled to indemnification from the tort feasor who created the dangerous condition.
The purpose of third party practice is to avoid two actions which should be tried together to save the time and cost of a reduplication of evidence to obtain consistent results from identical or similar evidence and to accomplish ultimate justice for all concerned with economy of litigation and without prejudice to the rights of another. State ex rel. McClure v. Dinwiddie, 358 Mo. 15, 213 S.W.2d 127, 129; Crompton-Richmond Co., Inc., Factors v. United States, D.C., 273 F. Supp. 219, 200; 3 Moore, Federal Practice, ¶ 14.04, 2d ed.
Again the court in Hipp v. Kansas City Public Service Co., supra, stated at 237 S.W.2d 1. c. 931: "The court's jurisdiction to summon a third party defendant does not depend on plaintiff's wishes in the matter but on defendant's, providing that he bring himself within the provisions of the statute."
While it is true that the trial court has discretion with respect to permitting a third party petition, this discretion is not unlimited and must be exercised on sound legal principles. Here the defendant Laclede has brought itself within the provisions of Rule 52.10. As said, the trial *699 court did not state in its order the reason for its prospective denial of relator's motion to file its third party petition. There is no showing here that the rights of others will be prejudiced by the third party petition; nor has any meritorious ground for the denial of the motion been shown.
The third party petition has injected no new issue into the trial. Plaintiffs' petition has allegations of active and passive negligence against Laclede and the building-owner defendants. Laclede and Rusert both have cross-claims against each other each seeking indemnity from the other on the theory that the evidence ultimately will show that one party was guilty of primary or active negligence whereas the other party was guilty, if at all, of passive or secondary negligence. At the same trial Laclede would also have an opportunity to prove its allegations pleaded in the third party petition that Ace was guilty of active negligence and Laclede's negligence, if any, was passive. We believe the court would exceed its jurisdiction by denying this third party petition.
Respondent contends that under the Workmen's Compensation Law the employee's remedies under the Act are exclusive and that he cannot maintain a common law action against his employer which would be the legal effect if his employer (Ace) is joined here. This same contention was rejected in McDonnell Aircraft Corporation v. Hartman-Hanks-Walsh Painting Co., Mo., 323 S.W.2d 788. In that case an employee of Hartman-Hanks-Walsh Painting Co. (hereinafter Hartman) sued McDonnell Aircraft Corporation (hereinafter McDonnell) for personal injuries sustained when he contacted an exposed electric wire while painting McDonnell's plant. McDonnell then joined Hartman under a third party petition asking for indemnity from Hartman. McDonnell's third party petition alleged that Hartman had agreed in a contract with McDonnell to warn Hartman's employees as to the existence and location of exposed electric lines and to take all necessary precautions for the safety of its employees and that Hartman failed in its duty in this regard. This is analogous to the allegation in Laclede's third party petition that Ace agreed to maintain its facilities in a safe operating condition. The employee had received workmen's compensation from Hartman. The issues between the employee and McDonnell were severed and tried separately which resulted in a judgment against McDonnell. McDonnell settled the judgment. McDonnell was then permitted to proceed against Hartman for indemnity based upon the breach of an express agreement by Hartman to perform the duty to McDonnell to warn and protect Hartman's employees.
Respondent then contends that Laclede is not permitted to implead Ace because Ace has been adjudicated bankrupt. No case is cited to support this contention. There is no allegation that the third party claim of Laclede against Ace is scheduled as an obligation of Ace in the bankruptcy proceedings. Respondent then argues that the United States District Court in the bankruptcy proceedings in an order of December 18, 1969 restrained "all other persons or corporations" from bringing an action against Ace. We have examined this order. It does not restrain anyone from bringing an action against Ace. It enjoined Providence Washington Insurance Company from paying over any money to any person (except the Receiver or trustee in bankruptcy) because of the fire suffered by Ace. It further enjoined "all other persons or corporations" from bringing any garnishments, attachments, executions, or levies against any funds held by Providence Washington Insurance Company by reason of the fire loss. This order does indicate that Providence Washington Insurance Company is the insurance carrier for Ace. Under these facts and in the absence of any restraining order, we do not believe that Ace's adjudication in bankruptcy prevents this third party action.
*700 On August 25, 1970, the plaintiffs filed a motion to quash the preliminary writ on the ground that since the issuance of the preliminary writ the plaintiffs have filed a third amended petition which changed the allegations of negligence as to Laclede and as to the building-owner defendants and that the issue here is now moot. The petition for the writ was filed on April 28, 1970. Our preliminary writ was issued on May 29, 1970 based on plaintiffs' second amended petition and both relator and respondent argued and briefed this case based on the allegations of negligence contained in plaintiffs' second amended petition. The determination of whether respondent exceeded his jurisdiction must be based on the record before him at the time of his announced intention to deny the motion which was April 10, 1970. We do not believe the issue has been made moot by the third amended petition.
This motion is denied and the preliminary writ is made absolute.
BRADY, P. J., and WOLFE, J., concur.
NOTES
[1] This court in a scholarly opinion by Judge Anderson in State ex rel. Siegel v. McLaughlin, Mo.App., 315 S.W.2d 499, 502 summarized a number of Missouri cases in which a party held liable for passive or secondary negligence secured indemnity from the active wrongdoer as follows: "* * * where a landlord is held liable by reason of the dangerous condition of his premises he may recover indemnity from the person who actually created the dangerous condition. Barb v. Farmers Insurance Exchange, Mo.Sup., 281 S.W.2d 297. A city held liable by reason of the dangerous condition of a sidewalk may recover from an adjacent property owner whose negligence created the hazardous condition. City of Springfield v. Clement, 205 Mo.App. 114, 225 S.W. 120. A principal who without personal fault is held liable for the acts of his agent may recover indemnity from said agent. State ex rel. Algiere v. Russell, 359 Mo. 800, 223 S.W.2d 481. One admittedly liable for injuries to a servant due to a defect in a scaffold of which defect he is ignorant may recover indemnity from the manufacturer of the scaffold for the amount paid in settlement. Busch & Latta Paint Co. v. Woermann Construction Co., 310 Mo. 419, 276 S.W. 614. Where a party wall is rendered dangerous by a fire and collapses, injuring persons, the municipality, after being held liable for failure to abate the nuisance, has an action over against the owners. Swentzel v. Holmes, dictum, Mo.Sup., 175 S.W. 871, L.R.A.1915E, 926. A telephone company which sets poles in the highway was held liable to the city for any damage it might be compelled to pay a party injured by reason of a defect in the street caused by the negligence of the telephone company. Kinloch Telephone Co. v. City of St. Louis, 268 Mo. 485, 188 S.W. 182. Where a railroad company constructs its tracks across a city street and fails to keep the crossing in repair, and the city is held liable for injuries resulting therefrom, the city may recover from the railroad. City of Independence v. Missouri Pacific Ry. Co., 86 Mo.App. 585. Where a judgment was recovered against a city by one whose horse was injured by an unguarded opening in a street, the city was held to have a cause of action against a contractor for his wrongful neglect to guard the openings as required by ordinance. City of Columbia v. Malo, Mo. App., 217 S.W. 625. A city held liable in damages because of an injury caused by a defective grating in a sidewalk maintained by an abutting property owner may recover against such owner. Kilroy v. City of St. Louis, 242 Mo. 79, 145 S.W. 769." The right of indemnification was also discussed in McDonnell Aircraft Corp. v. Hartman-Hanks-Walsh Painting Co., Mo., 323 S.W.2d 788 [6]. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534234/ | 120 N.H. 849 (1980)
In re RONNIE PRIME
No. 80-068.
Supreme Court of New Hampshire.
December 22, 1980.
*850 Bell, Falk & Norton, of Keene (Arnold R. Falk orally), for the petitionee, Ronnie Prime.
Gregory H. Smith, acting attorney general (Jeffrey R. Cohen, assistant attorney general, orally), for the State of New Hampshire.
DOUGLAS, J.
The issues in this case relate to a proceeding for involuntary commitment to the New Hampshire State Hospital under RSA 135-B:26 to :41.
On December 21, 1979, Sherwood Vachss, a State probation officer, filed a petition in the Cheshire County Probate Court seeking to have Ronnie Prime committed to the State Hospital. The petition alleged that Prime suffered from a mental illness that made him a danger to himself and others, as was demonstrated by his threats to his mother with a knife. It also stated that an Attorney Pappas was Prime's representative. RSA 135-B:28.
On that same day, a psychiatrist, Dr. Karin Mack, examined Prime and made a report which she later filed with the court. After a hearing on January 22, 1980, the Probate Court (Espiefs, J.) ordered Prime involuntarily committed to the State Hospital for a period not exceeding two years. He appeals that decision.
[1, 2] The first question raised by Prime's appeal is whether the probate judge had discretion to question a witness. After Dr. Mack had been questioned by counsel for both parties, Judge Espiefs asked her several questions in an apparent attempt to satisfy himself that the psychiatrist believed that Prime's illness posed a "potentially serious likelihood of danger to himself or to others" as required by RSA 135-B:26. As long as a judge maintains his impartiality, he has the right to question a witness in order to clarify the testimony. State v. Davis, 83 N.H. 435, 436, 144 A. 124, 125 (1928). It is the judge's duty to understand the testimony since it is he, and not the medical expert, who must determine whether a patient's illness has met the statutory standard. Dolcino v. Clifford, 114 N.H. 420, 421, 321 A.2d 577, 578 (1974). In this case, Dr. Mack expressed her opinion that Prime "could possibly harm himself or others," terms which are at odds with the statutory language. The probate judge was within his discretion in asking several questions to gain a clearer understanding of the testimony.
[3, 4] Prime's next argument is that there was insufficient evidence to support the court's order. For involuntary commitment, the State must prove beyond a reasonable doubt that an individual is potentially dangerous to himself or others. Proctor v. Butler, 117 N.H. 927, 935, 380 A.2d 673, 677-78 (1977). Before a court may *851 order involuntary commitment, "RSA 135-B:28 requires evidence of sufficiently recent `specific acts or actions' showing potential dangerousness...." Id., 380 A.2d at 678. Prime argues that the actions alleged in the petition were too remote from the time of the hearing to meet that requirement and urges us to adopt the forty-day limitation period of RSA 135-B:19 (Supp. 1979). We refuse to do so for the obvious reason that stricter standards must apply to emergency commitments under RSA 135-B:19 than under RSA 135-B:26, because a proceeding under the former deprives a person of his liberty immediately while the latter affords an evidentiary hearing before commitment.
In this case, in two separate incidents in May 1979, Prime threatened his mother and his brother with a knife. He again approached his mother with a knife in September, smashing it through a door she had locked behind her. That same night he threatened to slit her throat. Considering that Prime's conduct shows a consistent pattern, we believe that his most recent act is sufficiently recent to show a potential for dangerousness even though the period between the latest incident and the filing of the petition was two and one-half months.
[5] The words "mental illness" are defined in RSA 135-B:2 XI (Supp. 1979), which provides:
"[A] substantial impairment of emotional processes, or of the ability to exercise conscious control of one's actions, or of the ability to perceive reality or to reason, which impairment is manifested by instances of extremely abnormal behavior or extremely faulty perceptions; it does not include impairment primarily caused by: (a) epilepsy; (b) mental retardation; (c) continuous or noncontinuous periods of intoxication caused by substances such as alcohol or drugs; (d) dependence upon or addiction to any substance such as alcohol or drugs."
Although Dr. Mack never defined "mental illness," she did testify that from October 1979 to January 1980 she had admitted six patients for emergency hospitalization. Since the definition of "mental illness" is the same for both emergency hospitalizations and involuntary admissions, it is reasonable to assume that she was aware of the appropriate standard.
Dr. Mack testified that, through her examination, she was able to test Prime's ability to think and reason and was able to discern that his judgment was impaired. She further testified that Prime was often easily distracted; had difficulty expressing himself; was *852 very vague; had difficulty explaining the circumstances surrounding why he was being reevaluated; why he was in jail and what should or should not happen to him. This testimony supports the judge's finding that Prime met the statutory definition of mental illness.
[6] Prime further argues that Dr. Mack should have made specific findings that his mental impairment was not caused by epilepsy, mental retardation, or drug or alcohol intoxication or addiction. In her testimony, Dr. Mack stated that Prime "was somewhat retarded, but this was not the predominant part of the picture." That statement amounts to a finding that mental retardation was not the cause of Prime's illness. Common sense indicates that Dr. Mack made no findings as to epilepsy or drug or alcohol use because they were so obviously not the cause of Prime's instability. We do not require that a psychiatrist apply the statutory definition mechanically but only that a doctor address those elements that might reasonably be the cause of a patient's illness.
Finally, Ronnie Prime argues that Attorney Pappas was not a qualified representative. RSA 135-B:28 states that the petition for involuntary admission "... shall include: the name of the person sought to be admitted and his last known address; his representative and his last known address, if any" (emphasis added). That unambiguous language, coupled with the fact that the statute makes no express provision for appointment of a representative, indicates that a representative is not required in a proceeding for involuntary admission. Accordingly, we do not address the question.
Mr. Prime's interests were adequately protected by counsel and the evidence substantiates the decision of the probate judge.
Affirmed.
All concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534302/ | 120 N.H. 882 (1980)
ROGER YOUNG
v.
NEW HAMPSHIRE INDEMNITY COMPANY, INC. & a.
No. 80-195.
Supreme Court of New Hampshire.
December 26, 1980.
Upton, Sanders & Smith, of Concord (John F. Teague orally), for the plaintiff.
Hall, Morse, Gallagher & Anderson, of Concord (Robert E. K. Morrill orally), for the defendant.
DOUGLAS, J.
In this insurance coverage case we must determine whether the plaintiff Roger Young is an "executive officer," thereby requiring the defendant New Hampshire Indemnity Company to defend an action brought by a fellow employee against him. We hold that he is.
Mrs. Ruth W. Holmes was injured by a hydraulic press while employed at International Packings Corporation in Bristol, New Hampshire. After collecting workmen's compensation, she brought an action in July 1978 against Roger Young, a fellow employee. New Hampshire is one of only fourteen states that permit such actions. Stevens v. Lewis, 118 N.H. 367, 368, 387 A.2d 637, 638 (1978). See RSA 281:12 (Supp. 1979). As did the plaintiff in the Stevens case, Mrs. Holmes alleged that Young was in charge of plant safety and that he breached that duty by failing to provide a safe place for her to work.
The insurance carrier denied coverage and Young filed a petition for declaratory judgment under RSA 491:22. The Master, Robert A. Carignan, Esq., ruled in the plaintiff's favor. DiClerico, *883 J. approved the recommendation that the carrier was to provide coverage for Mrs. Holmes' action. This appeal followed.
International Packings Corporation (IPC) is a New Hampshire company that makes rubber seals and parts primarily for the automotive industry. The manufacturing process at the plant in Bristol, where Roger Young serves as plant manager, involves the use of many large, complex machines. Young's managerial duties place upon him the responsibility to supervise directly three foremen and forty employees. As safety officer, Young is head of the safety committee and is responsible for compliance with regulations of the United States Occupational Safety & Health Administration and the United States Environmental Protection Agency. Young also was involved in the purchase and construction of other plants. On his own signature, he has bound the corporation to contracts with machinery contractors and other tradesmen.
The retired treasurer of IPC, James Clowes, purchased the 121-page insurance policy at issue. Section II provides as follows:
"PERSONS INSURED
Each of the following is an insured under this insurance to the extent set forth below:
...
(c) if the named insured is designated in the declarations as other than an individual, partnership or joint venture, the organization so designated and any executive officer, director or stockholder thereof while acting within the scope of his duties as such;" (Emphasis added.)
Clowes stated his opinion that an "executive officer" would have, as did Young, authority "to hire, fire, get things done in his department." It was Clowes' belief that the policy he purchased covered Young, and the president of IPC also testified that he expected the same.
The policy does not define "executive officer." The definition of "executive officer" in WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY 794-95 (Unabridged 1961) is "the military officer second in command of a company or similar organization." Obviously, that will not aid us. Using the same dictionary, under the word "executive" we find: "one who holds a position of administrative or managerial responsibility in a business or other organization." Id. at 794. A "corporate officer," on the other hand, is a more precise and narrow definition tied to the corporate charter and bylaws. 2 *884 W. FLETCHER, CYCLOPEDIA OF THE LAW OF PRIVATE CORPORATIONS §§ 269-70 (rev. perm. ed. 1969).
It is little wonder that some courts have concluded that the insurance policy term "executive officer" is ambiguous. E.g., Guillory v. Aetna Insurance Company, 415 F.2d 650, 652 (5th Cir. 1969); Holm v. Mutual Service Cas. Ins. Co., 261 N.W.2d 598, 600 (Minn. 1977); see Hadrick v. Diaz, 302 So. 2d 345, 352 (La. App. 1974); Berry v. Aetna Casualty & Surety Company, 240 So. 2d 243, 246 (La. App. 1970), cert. denied, 401 U.S. 1005 (1971). The Berry case involved a suit by a fellow employee against a plant manager and a personnel director, among others. At the outset, the Court observed,
"It is clear the term `executive officer' covers something more than, and is not restricted to, `corporate officers'. If not, certainly the insurance company ... would have used that terminology."
Berry v. Aetna Casualty & Surety Company, supra at 246.
[1, 2] We recently adopted the majority rule that in "cases where policy language is ambiguous or when separate clauses lend themselves to conflicting interpretations, ... ambiguous language is construed against the insurer." Trombly v. Blue Cross/Blue Shield of New Hampshire-Vermont, 120 N.H. 764, 423 A.2d 980 (1980). We did so on the basis that "[o]ne of the most frequently articulated rationales for the rule is based on the fact that it is the insurer who controls the language of the policy and, therefore, any resulting ambiguity should be resolved in favor of the insured." Id. at 771, 423 A.2d at 984. Having adopted the majority rule, we apply it in this case and uphold the decision below requiring the carrier to defend Mr. Young.
Affirmed.
All concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534301/ | 468 S.W.2d 754 (1971)
ARKANSAS LOUISIANA GAS COMPANY, Appellant,
v.
McGAUGHEY BROTHERS, INC., Appellee.
No. 5-5581.
Supreme Court of Arkansas.
June 28, 1971.
*755 Hout, Thaxton & Hout, Newport, for appellant.
Pickens, Pickens & Boyce, by Tim F. Watson, Newport, for appellee.
FOGLEMAN, Justice.
Arkansas Louisiana Gas Company appeals from a jury award of $28,314 as compensation for lands of McGaughey *756 Brothers, Inc., taken by eminent domain for installation, maintenance and operation of a 24-inch underground gas pipeline. McGaughey Brothers owned and operated 3,586 acres of farmland located on the east bank of the White River. Crops produced were rice, cotton, soybeans and feed crops. 870 acres were in improved pasture over which there were unimproved roads. The owners of the farming corporation maintained a herd of 200 to 250 brood cows with calves and replacement heifers.
Appellant took 3.45 acres in fee simple upon which it erected a tower 168.5 feet high to support a pipeline suspended over White River, 20.4 acres as permanent right-of-way easement 80 feet wide for an underground pipeline, and temporary ingress, egress and "regress" for construction purposes over appellee's private roads, the area of which totalled 26.4 acres. This pipeline was located north of and parallel to six 10-inch pipelines on the McGaughey property, which converged into one line on that farm. 15 acres of unharvested soybeans were damaged as a result of the pipeline construction.
Appellant argues that the circuit court erred in permitting appellee to introduce evidence of damages to the private roads during the period of construction and the cost of their restoration, over its objection. It asserts that error was committed in admitting testimony about the condition of the roads after appellant's work had been completed. It contends these were special damages which had not been pleaded. We have held, in a case where a railroad constructed its tracks upon a right-of-way which it used for a short time and then removed its tracks and abandoned the right-of-way, the measure of damages to the landowner was the rental value of the land taken, in the condition it was when taken, for the time it was occupied, its depreciation in value by reason of timber cut and other acts done thereon by the railway company and the damages to the remainder of the owner's land resulting from the building of the road across it and from flooding or overflow caused by the construction. Pine Bluff & W. Ry. Co. v. Kelly, 78 Ark. 83, 93 S.W. 562.
Whenever the contemplated construction for which a right-of-way is taken has not been completed, damages are assessed upon the presumption that it will be built with skill and proper precautions; however, if construction is complete at the date of the trial, the jury may consider the state of facts then existing in the light afforded by actual construction. The assessment of damages embraces all past, present and future damages, including those arising from faulty construction, which the location of the facility for which the right-of-way is taken may reasonably produce. Springfield & Memphis Railway Co. v. Rhea, 44 Ark. 258; Missouri & N. A. Rd. Co. v. Bratton, 92 Ark. 563, 124 S.W. 231. Such damages are not special damages which must be pleaded. In Arkansas Central Railroad Co. v. Smith, 71 Ark. 189, 71 S.W. 947, we said:
Counsel for the company say that, if the pond was left upon the premises by the improper construction of the road, this would be an element of special damages, which could not be proved in this action, for the reason that there was no allegation to that effect, and no notice to the defendant of such a claim. This contention must be overruled, for, in the first place, there is no evidence and no contention that the road was improperly constructed. The mere fact that the excavation of earth for the roadbed left a pond of water does not necessarily show that the road was improperly constructed. But even if it did, it would make no difference for the road had already been constructed at the time of the trial; and it was for the jury to consider the state of facts then existing, and, with the light afforded by the actual construction of the road, determine what the damages were.
In Arkansas Power & Light Co. v. Harper (1970) 249 Ark. , 460 S.W.2d 75, *757 we held that any error in the admission of testimony as to timber removed from a right-of-way and windrowed along and partially beyond its outside edges as evidence of unpleaded special damages was cured by the court's proper instruction as to the measure of the landowner's recovery. The correct instruction as to the measure of appellee's compensation was here as in Harper, as will be presently illustrated.
Assuming, however, that the damage to the roads constituted special damages which should have been pleaded, we cannot say that there was any prejudice to appellant, because it did not plead surprise or request a continuance. When the trial court permits the introduction of evidence in face of an objection that the point at issue was not raised by the pleadings, the effect of the ruling is to treat the pleadings as amended to conform to the proof. Bonds v. Littrell, 247 Ark. 577, 446 S.W.2d 672. So the trial court's ruling here was equivalent to treating the issue as if it had been asserted by a pleading amended at that stage of the proceeding. The purpose of requiring special damages to be pleaded is to prevent surprise. Arkansas State Highway Commission v. Dixon, 247 Ark. 130, 444 S.W.2d 571. If appellant had pleaded surprise, when its objection was overruled, it might have been entitled to a continuance, if an issue of special damages not pleaded had arisen, in order to prepare to meet it. Missouri Pacific Transportation Co. v. Williams, 194 Ark. 852, 109 S.W.2d 924. But where no surprise is pleaded and no time requested to prepare to meet the issue, there is no error. Arkansas State Highway Commission v. Dixon, supra; Missouri Pac. Transp. Co. v. Williams, supra; Bennett v. Snyder, 147 Ark. 206, 227 S.W. 402; Ft. Smith Refrigeration & Equipment Co., Inc., v. Ferguson, 217 Ark. 457, 230 S.W.2d 943; Famous Store v. Lund-Mauldin Co., 149 Ark. 658, 233 S.W. 767; Thomas v. Spires, 180 Ark. 671, 22 S.W.2d 553.
Appellant's second point for reversal relates to the giving and refusal of instructions relating to the measure of just compensation to the landowners. The circuit court gave appellant's requested Instruction No. 4, as follows:
Under the law, McGaughey Brothers, Incorporated, is entitled to recover the fair market value of the lands acquired by Arkansas Louisiana Gas Company, determined as of the 28th day of September, 1964, together with the difference, if any, in the fair market value of the remainder of the lands immediately before and immediately after the taking.
You will, therefore, ascertain the difference between the market value of the entire tract of land of McGaughey Brothers, Incorporated, before the taking and the fair market value of the lands remaining in the tract after such taking, and that difference is the amount that McGaughey Brothers, Incorporated, is entitled to recover, and your verdict should be for McGaughey Brothers, Incorporated, in such amount.
When I use the expression "fair market value," I mean the price that the property of McGaughey Brothers, Incorporated, would bring on the open market in a sale between a seller who is willing to sell and a buyer who is willing and able to buy after a reasonable opportunity for negotiations.
Appellant's requested Instruction No. 5, which was refused, read:
In determining the amount of compensation to be paid to McGaughey Brothers, Inc., by Arkansas Louisiana Gas Company, you are to consider that the use of the lands acquired by Arkansas Louisiana Gas Company is limited to those uses for which they were acquired, and that McGaughey Brothers, Inc., has the absolute right to continue using the surface of the lands acquired for the right-of-way for other purposes not inconsistent with the use of the easement by Arkansas Louisiana Gas Company.
*758 The court gave an instruction requested by appellee after modifying it to read as follows:
(Request)
You are instructed that Arkansas Louisiana Gas Company acquires by this Condemnation Proceeding the power to make such use of the 20.4 acre right-of-way across the property of the landowners as its present and future needs require for the purpose for which the right-of-way is condemned, and Arkansas Louisiana Gas Company is liable to the landowners as though the lands were taken in fee simple or absolute title.
(Modification)
As to the 3.45 acreage, McGaughey Brothers have no further right or control. As to the 20.4 acres over which the Arkansas Louisiana Gas Company now holds an easement, the McGaughey Brothers, Incorporated, have the right to such use and control of the surface of these lands so long as the uses and purposes to which they are put are not inconsistent with the Arkansas Louisiana Gas Company's right to maintain and operate their pipeline.
Appellant first argues that the instruction given was erroneous because it made the condemnor "liable to the landowners as though the lands were taken in fee simple or absolute title," rather than "liable for the full market value of the land taken as if it were taken in fee simple absolute." This semantic argument is not well founded. We do not see how the jury could have been misled when the instructions are read as a whole. "As if" and "as though" are commonly accepted as conveying the same meaning. Webster's New International Dictionary, Unabridged, Second Edition.
Appellant's principal argument relating to these instructions, however, is based upon Arkansas Power & Light Co. v. Mayo, 244 Ark. 435, 425 S.W.2d 531. There the court (three members dissenting) said that we could not be certain that the instructions given in a similar case did not confuse the jury as to the proper measure of the landowner's recovery. The court here, however, followed the teaching of Mayo. It is true that the appellee's requested instruction before its modification was quite similar in wording to the instruction requested by the landowner in Mayo, which we said might have been misleading and confusing to the jury when read with the instruction on the measure of compensation, given by the court, so that a double award might have resulted. The first paragraph of the instruction given by the court at appellant's request is virtually identical to the instruction which the condemnor had requested in Mayo, and which we said more clearly expressed the law than the court's instruction there, even though the latter standing alone was correct. In view of the modification of appellee's requested instruction and the giving of the first paragraph of appellant's requested instruction, the two instructions read together were not likely to have confused the jury or misled it into a double award.
Appellant also alleges that the verdict is excessive because there is no substantial evidence to support it. We are unable to agree. Appellee's six witnesses stated differences in the market value of the property before and after the taking ranging from $45,100 to $67,671.35. No useful purpose would be served by outlining all the testimony. J. C. McGaughey, an officer, director and assistant manager of appellee, testified that the value of the lands taken totalled $10,732.50. He also testified that it was necessary to move $1,000 worth of dirt in to restore the roads used by appellant and to reblade and rework them. DeWitt McGaughey, also an officer and director of appellee, who was also its manager, said that it would cost $2,000 to get the roads in proper shape.
Appellant first attacks the substantiality of the testimony of these witnesses *759 upon the ground that none of them mentioned any comparable sales. All of them qualified as competent to state opinions as to the market value of the lands. Having done so, they were not required to refer to comparable sales on direct examination or give the basis of their opinions. Arkansas State Highway Commission v. Hartsfield, 248 Ark. 821, 454 S.W.2d 82; Arkansas State Highway Commission v. Johns, 236 Ark. 585, 367 S.W.2d 436. The burden was upon appellant to demonstrate that the testimony of these witnesses was without any reasonable basis. Urban Renewal Agency of Harrison v. Hefley, 237 Ark. 39, 371 S.W.2d 141; Arkansas State Highway Commission v. Johns, supra. As far as we can tell from the abstract of the testimony, none of the six witnesses was asked about comparable sales or the extent to which he relied upon them. Failure to cross-examine on this subject might be taken to mean that appellant was satisfied on this subject. Arkansas State Highway Commission v. Hartsfield, supra. Appellant is in no position to contend that the testimony of any such witness was insubstantial because of his lack of knowledge of comparable sales. Arkansas State Highway Commission v. Clark, 247 Ark. 165, 444 S.W.2d 702.
Appellant states that the reasons given by some of the witnesses for the reduction in value of appellee's remaining lands after the taking were:
(1) during floods, appellee's cattle would have to walk around the tower erected on the land taken in fee or swim out through low land that admittedly was there before the acquisition by appellant; (2) speculation that appellant would continue to use appellee's private roads in the future and leave gates open, even though it is admitted that appellant has no further rights to the use of those roads; (3) supposed devaluation of improvements, even though the acquisition by appellant takes none; (4) the continuing right of appellant to traverse the right-of-way for maintenance purposes; (5) seepage and loss of drainage due to the pipeline, although a pipeline owned by another company is located parallel to appellant's pipeline and was laid long before appellant's pipeline was laid; (6) the tower located on the tract condemned in fee hinders the aerial application of chemicals on appellee's crop, although it was admitted that there were trees in the area; and (7) the nuisance factor is that the pipeline is "there."
Appellant then argues that the evidence in this case brings it within the ambit of Texas Illinois Natural Gas Pipeline Company v. Lawhon, 220 Ark. 932, 251 S.W.2d 477, in the sense that nuisance or inconvenience to the landowner because of the presence of the pipeline constituted the principal basis for the opinions of the witnesses, so that there was no substantial basis to fully support the jury verdict. Granting, without deciding, that the value testimony of certain witnesses may have been subject to this infirmity, it is clear that the testimony of others was not shown to be. While not controlling, it is significant that appellant not only did not challenge the qualifications of any witness to express his opinion as to values, but it moved to strike the testimony of only one of the six.
Appellee's witnesses testified that the cattle operation of McGaughey Brothers, Inc., like that of most of the neighboring farms bordering the river, was carried on along the river. From December to May, however, J. C. McGaughey testified that the cattle were pastured on about 1,500 acres of land on which soybeans were later planted. During times the river was at high stage, some of the lands were flooded.
According to J. C. McGaughey, prior to the taking, the cattle would go to the high ridge along the river as it rose, and walk to safety. The tower site, he said, covers a ridge so that it cannot be crossed by the cattle, and they would have to swim out if they were below the tower when the water rose. He said that there were four fences *760 crossing the right-of-way designed to keep cattle out of crops. He could not accurately estimate the amount by which the improvements were devaluated. He also took into consideration the compounding of drainage problems due to the additional pipeline and inability to use a dragline for ditching across the right-of-way, problems connected with aerial application of insecticide, seepage problems due to the excavation for the pipeline and the fill and the attendant difficulty in maintaining dikes for flooding rice fields. He could not break the devaluation due to the last item into dollars and cents.
John Keel, a neighboring farm owner corroborated the existence of a drainage problem due to the impoundment of surface water by the fill over the pipeline. D. L. Buffington, a Newport real estate man, whose qualifications were admitted, placed the difference in values at $53,796.53. He considered as elements of damages to appellee's remaining lands: interference with the cattle operation (which he said was attributable to the fact that the tower effectively cut off 200 acres of the farm in high water); the probability that emergencies might cause the condemnor to go across appellee's farmland, the only way by which the pipeline can be reached, without permission, which would involve time and trouble in a landowner's recovering damages; and aggravation of the drainage problems due to the additional pipeline. Buffington stated that if the cattle were cut off during high water and would not go through the water, the owners would have to take them out by boat or take them around by Tupelo or other such place. He was not asked to allocate a specific figure to any element.
In Arkansas State Highway Commission v. Wallace, 247 Ark. 157, 444 S.W.2d 685, we said that a witness' testimony to a total compensation figure could not stand against a motion to strike if it included an impermissible element of damage, unless the amount improperly included can be distinguished. But we said that the witness should be afforded an opportunity to specify the amount improperly included. We denied a challenge to value testimony both by motion to strike and by the contention that the verdict did not have substantial evidentiary support, because each witness considered at least one element proper for the jury's consideration, but was not afforded an opportunity to specify the amount attributable to an improper element of damage. Arkansas State Highway Commission v. Woody, 248 Ark. 657, 453 S.W.2d 45.
Both J. C. McGaughey and Buffington considered permissible elements of damage. The impoundment of surface water and impairment of drainage was a compensable element of damage. Springfield & Memphis Railway Co. v. Henry, 44 Ark. 360; Arkansas State Highway Commission v. Dixon, 247 Ark. 130, 444 S.W.2d 571; Miller Levee District No. 2 v. Wright, 195 Ark. 295, 111 S.W.2d 469. So was the severance damage because of the inability of the cattle to travel from one part of the land to another, Arkansas State Highway Commission v. Freyaldenhoven, 246 Ark. 688, 439 S.W.2d 791, and decreased value of improvements. Miller Levee District No. 2 v. Wright, supra; Donaghey v. Fones Brothers Hardware Co., 171 Ark. 1056, 287 S.W. 414; Donaghey v. Lincoln, 171 Ark. 1042, 287 S.W. 407. Since these elements, and perhaps others,[1] were properly *761 considered, we cannot say that the testimony of these witnesses was not substantial. Neither was afforded an opportunity to state the damage attributable to any impermissible element. We cannot say that their testimony was not substantial evidence.
The judgment is affirmed.
NOTES
[1] Increased difficulty in cultivation of a farm by reason of obstacles to use of farm machinery by electric transmission lines and towers seems to be a recognized element of damages. Illinois Iowa Power Co. v. Rhein, 369 Ill. 584, 17 N.E.2d 582 (1938); Central Illinois Public Service Co. v. Lee, 409 Ill. 19, 98 N.E.2d 746 (1951); Southwestern Public Service Co. v. Goodwine, 228 S.W.2d 925 (Tex.Civ. App.1949). Aerial application of insecticides is a common farming practice. Increased difficulty in this practice increasing cost and diminishing efficiency would seem to fall in the same category. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534307/ | 468 S.W.2d 837 (1971)
Cresencio G. VILLAREAL, Appellant,
v.
The STATE of Texas, Appellee.
No. 43891.
Court of Criminal Appeals of Texas.
June 16, 1971.
Rehearing Denied July 28, 1971.
*838 Walter E. Boyd, Jr., Houston, court appointed on appeal, for appellant.
Carol S. Vance, Dist. Atty., James C. Brough and Bob Floyd, Asst. Dist. Attys., Houston, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ONION, Presiding Judge.
This is an appeal from a conviction for burglary with intent to commit theft. The punishment, enhanced under the provisions of Article 63, Vernon's Ann.P.C., was assessed at life.
In addition to the instant offense, the indictment alleged that on June 22, 1954, the appellant was convicted of the offense of felony theft in Cause No. 69107 in the Criminal District Court No. 2 of Harris County, Texas, and that after such conviction became final the appellant committed the offense of burglary and on September 8, 1960, was duly convicted of such offense in Criminal District Court No. 4 of Harris County, Texas, in Cause No. 92359.
The sufficiency of the evidence as to the primary offense is not challenged. Appellant, however, vigorously contends the court erred in enhancing punishment under Article 63, supra, since the evidence is insufficient to reflect that the 1960 burglary conviction alleged for enhancement was for an offense committed after the 1954 felony theft conviction (also alleged for enhancement) became final.
In Rogers v. State, 168 Tex. Crim. 306, 325 S.W.2d 697, it was said:
"This Court has consistently held that to invoke the provisions of Article 63, Vernon's Ann.P.C., it is necessary that each succeeding conviction be subsequent both in point of time of the commission of the offense and the conviction therefor. Guilliams v. State, 159 Tex. Crim. 81, 261 S.W.2d 598, and cases cited.
*839 "The indictment must so allege and the averments of the indictment must be supported by proof. Arbuckle v. State, 132 Tex. Crim. 371, 105 S.W.2d 219, 221; Armendariz v. State, 163 Tex. Crim. 515, 294 S.W.2d 98, 99." See Wheat v. State, Tex.Cr.App., 442 S.W.2d 363 and cases there cited.
In the case at bar the State, at the penalty stage of the proceedings, introduced authenticated prison records of the appellant which included certified copies of the judgments and sentences in the prior convictions alleged for enhancement as well as photographs and sets of fingerprints.
Thereafter the State offered into evidence a certified copy of the indictment in said Cause No. 92359, the 1960 burglary conviction,[1] and then the record reflects the following:
"MR. HIRTZ: Thank you, Your Honor. We respectively call the court's attention to the fact that it (the authenticated prison records relating to the 1960 burglary conviction) alleges the date of the commission of the offense of burglary to be the 14th of June, 1960. And we would rely upon Article 179 of the Texas Code of Criminal Procedure of 1925, that the statute of limitations was five years and that the conviction in the theft case, No. 69107, was a final conviction, before the commission of the offense on which the indictment in Cause No. 92359 is based, Your Honor.
"MR. BURNS: I will so stipulate, that the five years has run in both of them.
"MR. HIRTZ: The State so stipulates. Do you stipulate, Mr. Villareal?
"THE DEFENDANT: Yes, sir.
"MR. HIRTZ: I have no further questions of Mr. Butts.
"MR. BURNS: My stipulation is: The five years has run on the '60 conviction. I am not stipulating anything as to Cause No. 69107, but I will stipulate as to the 1960 conviction; which number is that?
"THE COURT: You have stipulated as to No. 92359.
"MR. BURNS: You understand, I am not stipulating to anything on the '54 conviction, which is 69107?
"MR. HIRTZ: Except that it was a final conviction before the offense was committed in Cause No. 92359; is that correct?
"MR. BURNS: I am not stipulating to anything.
"MR. HIRTZ: Well, it is already in evidence before the Court."
The State has taken the position that evidence supposedly missing was supplied by the stipulation. The appellant contends that a stipulation to be valid must be clear and unambiguous and that the stipulation in question, therefore, cannot be considered.
We need not consider at all the stipulation to properly dispose of appellant's contention.
It is true as appellant contends that normally the State may not supply proof of the date of the commission of the offense resulting in the second prior conviction (alleged for enhancement) by offering only the indictment therefrom. See *840 Rogers v. State, 169 Tex. Crim. 239, 333 S.W.2d 383. However, in Garay v. State, Tex.Cr.App., 389 S.W.2d 952, it was held an indictment is not evidence as to when a prior offense was committed other than where there is a final conviction the offense should be presumed to have been committed some time within the period of limitation prior to the filing of the indictment. The 1960 burglary conviction became final on September 8, 1960, no notice of appeal having been given. See Robertson v. State, Tex.Cr.App., 418 S.W.2d 678; Wheat v. State, supra. The indictment in such case was shown to have been presented and filed on July 22, 1960. The statute of limitation for the offense of burglary is five years. See Article 12.03, V.A.C.C.P. Therefore, it is presumed that the offense was committed within five years prior to July 22, 1960, or sometime after July 22, 1955. The first prior conviction (Cause No. 69107) alleged for enhancement became final on June 22, 1954, no notice of appeal having been given. We conclude, therefore, that the evidence was sufficient to show that the first prior conviction alleged for enhancement was a final conviction before the commission of the offense which formed the basis of the second prior conviction.
Appellant's second ground of error attacks the use of a set of fingerprints taken from him during the process of the trial and utilized by a fingerprint expert at the penalty stage of the trial for comparison purposes with the fingerprints contained in the authenticated prison records in order to identify him as one and the same person so previously convicted as alleged. This Court has repeatedly held such fingerprints so obtained are admissible and no violation of the privilege against self-incrimination is involved. Gage v. State, Tex.Cr.App., 387 S.W.2d 679; De La Rosa v. State, Tex.Cr.App., 414 S.W.2d 668; Travis v. State, Tex.Cr.App., 416 S.W.2d 417; Harrington v. State, Tex.Cr.App., 424 S.W.2d 237; Branch v. State, Tex.Cr. App., 445 S.W.2d 756; Washington v. State, Tex.Cr.App., 434 S.W.2d 138; Johnson v. State, Tex.Cr.App., 432 S.W.2d 98; Trammell v. State, Tex.Cr.App., 445 S.W.2d 190; Price v. State, Tex.Cr.App., 449 S.W.2d 73; Tea v. State, Tex.Cr. App., 453 S.W.2d 179; McKenzie v. State, Tex.Cr.App., 450 S.W.2d 67; Gordon v. State, Tex.Cr.App., 461 S.W.2d 415; Williams v. State, Tex.Cr.App., 461 S.W.2d 614; Martin v. State, Tex.Cr.App., 463 S.W.2d 449; Rinehart v. State, Tex.Cr. App., 463 S.W.2d 216.
When such evidence was offered at the penalty stage of the trial reflecting that the appellant had been fingerprinted by the expert witness a few minutes before, there was no objection.
Appellant actually appears to complain about the action of the Assistant District Attorney who, earlier in the trial, had gone during the noon hour to a holdover cell near the courtroom where the appellant, in absence of counsel, was being held and demanded that he allow his prints to be taken by the expert witness who was present. The appellant refused, stating he was eating his lunch. He appears to disprove of an alleged statement then made by the prosecutor that he would get "three deputies" to see that the prints were obtained. The prints were not, of course, taken at the time and the action of the prosecutor was brought to the attention of the trial judge who stated that he would order the appellant printed if and when it became necessary.
We perceive no error.
The judgment is affirmed.
NOTES
[1] This exhibit which was marked for identification State's Exhibit #3 was received into evidence for "comparison purposes only" at the guilt stage of the trial and did not go to the jury. At the hearing on punishment before the court it "was received generally." It was not in the appellate record received but has been obtained by order of this Court. See Article 40.09, Sec. 15, Vernon's Ann. C.C.P. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534325/ | 468 S.W.2d 306 (1970)
Lorene Heflin HILL, Administratrix of the Estate of Juanita Heflin Taylor a. k. a. Monroe, Appellant,
v.
OHIO COUNTY, Kentucky, et al., Appellees.
Court of Appeals of Kentucky.
September 25, 1970.
As Modified on Denial of Rehearing July 2, 1971.
John D. Miller, Richard D. Gilliam, Owensboro, for appellant.
Carmol D. Cook, Hartford, for appellee Eva Hartley.
Ronald M. Sullivan; Sandidge, Holbrook, Craig & Hager, Owensboro, for appellee, Ohio County, Kentucky.
*307 MACAULEY SMITH, Special Commissioner.
In this action for wrongful death, plaintiff claimed $100,000 for "loss of earnings," $521 for funeral and $50,000 punitive damages against Ohio County, as owner and operator of Ohio County Hospital, the members of the fiscal court and the hospital board, two of the four doctors admitted to practice in the hospital, and Eva Hartley, R.N., in charge of the "floor" at the time plaintiff's intestate was refused admission. Pursuant to the ruling in Rather v. Allen County War Memorial Hospital, Ky., 429 S.W.2d 860, to the effect that under KRS 67.186 (and Constitution Sec. 231) a county is immune from such a suit except to the extent of insurance coverage, if any, authorized under KRS 67.186, plaintiff amended to reduce her demand to $48,000 (within the limits of the admitted $50,000 insurance policy with the Travelers).
Discovery was availed of, and complied with, and after hearing arguments and receiving memoranda, the trial court sustained defendants' motion for summary judgment and dismissed the action as against defendants Ohio County Hospital, Ohio County, and Eva Hartley, without adducing any reasons therefor. (This final order recites that all other defendants had been previously dismissed the record on appeal contains no such previous order).
The uncontradicted material facts brought out by the answers to discovery interrogatories and depositions of Nurse Hartley and Dr. Robert T. Johnson were as follows:
Decedent approached Nurse Hartley at her desk in the hospital before 9 a.m. on May 12, 1967, said that her name was Juanita Monroe, her doctor was in Illinois, she had come to Ohio County to attend a funeral and she was afraid she would not be able to get back to Illinois before she had her baby. Nurse Hartley assumed she wanted to be admitted for obstetrical (herein OB) care.
There were only four doctors admitted to practice in the hospital. Nurse Hartley consulted her list and found that Dr. Beard (according to the doctors' informal agreement among themselves) was "on call" that week. He was at the time in the operating room. Upon Nurse Hartley's inquiry whether to admit decedent, Dr. Beard required that he did not handle OB cases. Upon advice from the hospital administrator that another of the four doctors, Dr. Johnson, was making rounds, Nurse Hartley asked him the same question and Dr. Johnson replied that he did not handle "walk-in OBs."
Decedent did not advise that she had been delivered of a child at the Ohio County Hospital in June 1964, admitted by Dr. Charles Price of Hartford (one of the four doctors practicing in the Hospital) and had again consulted Dr. Price within the past year.
Decedent was advised that she could get OB service in Owensboro and Louisville, with doctors on call, and replied she did not want to go to Owensboro or Louisville, but would call a taxi to go home. Nurse Hartley assisted her in making the call. Being advised that decedent was still there more than an hour later, Nurse Hartley consulted with the hospital administrator and was told to call Bill Danks, ambulance driver, who promptly appeared and offered to take decedent wherever she wanted to go. She declined, and a taxi finally took her away.
Her baby was born at home (apparently unattended) during that night. Decedent called Bill Danks who came immediately, and about 6 a. m. called Dr. Johnson, who asked some questions concerning the state *308 of mother and child and advised Danks to take them to Owensboro. Decedent was dead on arrival at the Owensboro Hospital, some 25 miles from Hartford.
Ohio County Hospital is a public hospital, constructed (at least in part) with Hill-Burton funds which are for construction only. It is a one-floor building and the county pays the cost of operation, including an administrator (not a doctor) and at least two registered nurses. There are no salaried doctors, no residents or interns, and only four local doctors are admitted to practice. The hospital rules properly provide that no patient may be admitted without an order from a doctor to do so KRS 311.560 provides that no one may practice medicine without being licensed to do so. In Frank v. South (1917), 175 Ky. 416, 194 S.W. 375, it was held that the administering of anesthetics by a registered nurse did not constitute the practice of medicine by her when always done under the personal direction and supervision of a licensed surgeon.
In 40 Am.Jur., 2d 859, Hospitals and Asylums, Sec. 12, it is said:
"With respect to a public hospital, it has been said that since all persons cannot participate in its benefits, no one has, individually, a right to demand admission. The trustees or governing board of a public hospital alone determine the right of admission to the benefits of the institution, and their discretion in this regard will not be reviewed by the courts at the suit of an individual applicant."
Appellant chiefly relies upon Wilmington General Hospital v. Manlove (1961), Del., 4 Storey 15, 174 A.2d 135; O'Neill v. Montefiore Hospital (1960), 11 A.D.2d 132, 202 N.Y.S.2d 436; and Barcia v. Society of New York Hospital (1963), 39 Misc. 2d 526, 241 N.Y.S.2d 373.
In Manlove the refusal of a summary judgment for defendant hospital was affirmed, the court saying 174 A.2d at p. 141:
"In the circumstances we think the case should go back for further proceedings. We should add, however, that if plaintiff cannot adduce evidence showing some incompetency of the nurse, or some breach of duty or some negligence, his case must fall. Like the learned judge below, we sympathize with the parents in their loss of a child; but this natural feeling does not permit us to find liability in the absence of satisfactory evidence."
In discussing the Montefiore case, the court said in Manlove at page 140:
"* * * Two judges dissented, pointing out that the doctor called by the nurse did not, after talking to the patient, indicate that any emergency treatment was required, or request that the patient be admitted to the hospital. In these circumstances they found no liability.
"The difference of opinion in that case seems to turn on the question whether, by calling a physician for the applicant, the nurse assumed to give him hospital service. The case does not discuss the questions of what constitutes an emergency, and what is the duty of the nurse in such cases.
"As to the majority holding that the nurse's telephone call gave rise to liability, we respectfully dissent. We think the minority opinion is the better view."
In Montefiore a man in pain from a heart ailment applied at the emergency room of defendant hospital and was told that the hospital did not care for hospital-insurance-plan patients. The nurse did telephone for a Dr. Graig who was one of the doctors on call for such patients. The *309 patient conversed with him on the telephone and according to the doctor refused his services and asked for his own Dr. Kirstein who would not be available until 8 o'clock. The action as against the hospital was dismissed at the close of plaintiff's case and as against the doctor at the conclusion of all of the evidence. The Supreme Court, Appellate Division, reversed for a new trial, two justices dissenting as follows:
"I concur in the order for reversal and for a new trial as against defendant Frank Graig. I dissent and vote to affirm the dismissal of the complaint against defendant Montefiore Hospital. Through the efforts of the hospital's nurse, the decedent had been enabled to communicate by telephone with Dr. Graig who had knowledge of the decedent's presence at the hospital. Dr. Graig did not indicate in any manner that emergency treatment was required nor did he direct or request the admittance of the decedent as a patient to the hospital. Any action by the nurse contrariwise would not have been in keeping with her position. It is my view that the conduct of the nurse was by way of favor and I fail to see any legal basis for liability on the part of the hospital."
This dissent was approved in Manlove.
In Barcia an extremely ill child was admitted as an emergency, several tests were taken by a staff doctor and were put in process of culture, the child was sent home and then readmitted, whereupon it almost immediately died. This case is clearly distinguishable because it presented an emergency and an admission to the hospital and an undertaking to afford treatment, as involving possibly malpractice or negligence on the part of a staff doctor.
In the instant case, the decedent was not admitted to the hospital nor was the element of critical emergency apparent. The hospital nurse acted in accordance with valid rules for admission to the facility. The uncontradicted facts demonstrate that no breach of duty by the hospital occurred. The nurse could not force the private physicians to accept decedent as a patient. The nurse did all she could do for the decedent on the occasion in question. Therefore, the hospital and the nurse were entitled to dismissal as a matter of law.
The judgment is affirmed.
MILLIKEN, C. J., and HILL, NEIKIRK, PALMORE and STEINFELD, JJ., concur.
OSBORNE and REED, JJ., dissent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534322/ | 468 S.W.2d 432 (1971)
Robert Lee JENKINS, Appellant,
v.
The STATE of Texas, Appellee.
No. 43768.
Court of Criminal Appeals of Texas.
June 9, 1971.
Rehearing Denied July 14, 1971.
*433 Tim C. Curry, Fort Worth (court appointed), for appellant.
Frank Coffey, Dist. Atty., Jerry J. Loftin, George McManus, Roger Crampton and John Garrett Hill, Asst. Dist. Attys., Fort Worth, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ROBERTS, Judge.
This is an appeal from a conviction for robbery by assault, enhanced under the provisions of Art. 62 of the Vernon's Ann. Penal Code; trial was before a jury and the court assessed the mandatory punishment of life.
The evidence viewed most favorably to the jury's verdict shows that while Artie R. Ewing, Jr., was stopped at a red light on Lancaster Road in Fort Worth on November 8, 1969, at about 10 p.m., the appellant, reaching through the open window, stuck a gun in Ewing's left temple and demanded his money, so Ewing gave the appellant his billfold. The appellant then drove the car to a different place where the appellant shot Ewing in the back and in the right arm and locked him in the trunk and drove off. Appellant later stopped the car, asked Ewing if he was still alive, and told Ewing *434 to get out of the trunk. Ewing ran off and while he was running the appellant shot him again in the arm, but he still managed to escape.
The appellant's first ground of error challenges the testimony of two police officers pertaining to fingerprints taken from an automobile, alleging that the State failed to prove that the automobile in question belonged to the injured party.
Officer J. W. Burkhart of the Fort Worth Police Department testified that on the night in question he took some fingerprints off a 1967 red Chevrolet that was located near the Glass Key night club, but that he did not know who was the owner of the vehicle.[1]
Officer F. M. Alexander, identification officer for the Fort Worth Police Department, took some fingerprints of the appellant,[2] and based on a comparison between the two sets of prints, testified that they were taken from the same man.
Ewing had testified that he was driving a 1967 Chevelle Malibu, a Chevrolet, and that he had last seen it near the Glass Key night club when he ran from appellant.
Counsel for the appellant objected to the admission of State's Exhibit One into evidence, at the time of its introduction, solely on the ground that writing on the side of the exhibit constituted hearsay. Counsel objected to Alexander's testimony solely on the ground that he had not been qualified as an expert to compare the two sets of fingerprints. It was only after the State had rested that counsel for the appellant moved that, "the court withdraw State's Exhibit One from the jury on the ground that the State had failed to prove the chain of evidence from the crime lab to the police department. The State failed to prove that State's Exhibit One is, in fact, the same set of prints that was taken from the 1967 Chevrolet which arrived at the Police Department."
When this evidence was admitted, "No objection on the ground now urged was made and called to the trial court's attention and thus no error is presented for appellate review.' Hulin v. State, Tex. Cr.App., 438 S.W.2d 551; Guajardo v. State, 168 Tex. Crim. 503, 329 S.W.2d 878; Cork v. State, Tex.Cr.App., 362 S.W.2d 314; Cork v. State, Tex.Cr.App., 362 S.W.2d 316.
And the motion to withdraw State's Exhibit One from the jury came too late to preserve any alleged error since it was made after the exhibit had been admitted and after the State had rested its case. Klein v. State, Tex.Cr.App., 384 S.W.2d 872; Fernandez v. State, 158 Tex. Crim. 266, 254 S.W.2d 1004.
The appellant's first ground of error is overruled.
The appellant's second ground of error complains that there was written material on State's Exhibit One which constituted hearsay. The notation was as
follows: "Shooting
900 Luella
11-8-69 11:55 p
Victim: Artie R.
Ewing Jr.
J. W. Burkhart 599
Red 67 Chev 2 Dr.
DZY 708
#1 & #2 from outside,
Rt door glass #3 from
inside rt. vent glass"
It appears that the writing complained of consists of a notation as to the place, date, time, victim, the officer's name, and a description of the automobile and the location of the automobile from which the fingerprints were taken. There was no notation on the card which connected or would tend to connect the appellant with the offense charged. "The notations were means of identification of the exhibits and nothing *435 of an evidentiary nature was presented to the jury which was not otherwise properly before them." Ragland v. State, Tex.Cr. App., 391 S.W.2d 418; Ellison v. State, 154 Tex. Crim. 448, 227 S.W.2d 817.
The appellant's second ground of error is overruled.
The appellant's third ground of error complains of State's Exhibit One because the State failed to prove the chain of custody from the time the exhibit was recovered by the police officers until the time it reached the court. Objections were not timely made to the exhibit on these grounds, as explained in the discussion of appellant's first ground of error. See also: Watkins v. State, Tex.Cr.App., 411 S.W.2d 364.
The appellant's third ground of error is overruled.
Lastly, the appellant complains of Burkhart's testimony "because the State failed to comply with the defendant's request to furnish him with a list of all the witnesses the State expected to use."
The record reflects that when Burkhart took the stand, the appellant objected to his testimony for the reasons stated in the ground of error. Following this objection, the jury was excused and the attorneys argued over what the State's attorneys furnished to the defense attorneys and whether this witness's name was on the list. The court overruled the objection.
Art. 20.20 of the Vernon's Ann. Code of Criminal Procedure provides that the attorney for the State shall endorse on the indictment the names of the witnesses upon whose testimony it was found. Such endorsement can be compelled by motion, but the testimony of a witness will not be excluded because his name is not on the indictment. Mullins v. State, Tex.Cr.App., 425 S.W.2d 354. The statutory provision that the names of the witnesses upon whose testimony the indictment is found shall be endorsed thereon is directory and not mandatory. Hackathorn v. State, Tex.Cr.App., 422 S.W.2d 920.
No motion to compel the State to so endorse the names of the witnesses or to furnish them to the appellant's attorneys is in the record and although it appears from the discussion outside the presence of the jury that a list was furnished, that list is not in the record and the contents thereof are unknown.
Since no motion was made, no error is shown, and the appellant's fourth ground of error is overruled.
There being no reversible error, the judgment is affirmed.
NOTES
[1] They were introduced as State's Exhibit One.
[2] Introduced as State's Exhibit Two. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534318/ | 468 S.W.2d 496 (1971)
ALLSTATE INSURANCE COMPANY, Appellant,
v.
Faye MAINES, Appellee.
No. 489.
Court of Civil Appeals of Texas, Houston (14th Dist.).
May 19, 1971.
Rehearing Denied June 9, 1971.
*497 Ronald C. Kline, Bracewell & Patterson, Houston, for appellant.
James R. Watson, Jr., Robert E. Hall, Dixie, Wolf & Hall, Houston, for appellee.
BARRON, Justice.
This is a workmen's compensation case tried to a jury in District Court of Harris County. The jury found that Faye Maines, claimant, designated here as plaintiff, was totally and permanently disabled as the result of an injury she received while working for Sears Roebuck and Co.; that she notified her employer of said injury within thirty days of its occurrence; and that she had "good cause" for delaying the filing of her claim with the Industrial Accident Board. Judgment was accordingly rendered in favor of plaintiff for total permanent disability.
The appellant, Allstate Insurance Company, the insurance carrier, designated defendant here, has appealed, essentially contending that special issues number 12, 13 and 14 relating to "good cause" have no support in the evidence or are against the great weight and preponderance of the evidence; and that there is no evidence to support special issue number 4, dealing with the jury's finding concerning total permanent disability or that the evidence concerning same is against the great weight and preponderance of the evidence.
On this appeal we are required on the "no evidence" questions to consider only that evidence, if any, which, viewed in its most favorable light, supports the jury findings, and we are required to disregard all evidence which would lead to a contrary result. Biggers v. Continental Bus System, 157 Tex. 351, 303 S.W.2d 359, 363 (Tex.Sup.). Plaintiff was, however, required to prove why the filing of the claim was deferred up to the date of filing. Texas Casualty Insurance Company v. Beasley, 391 S.W.2d 33 (Tex.Sup.).
The record shows that plaintiff was a fifty-three year old woman possessed of a high school education. She had worked for Sears since 1948 as a "credit authorizer." The record shows no prior claim for workmen's compensation. On August 8, 1967, while she was at work, she went to get a ledger card out of a file cabinet in the office, which card was located in the bottom drawer. The file cabinet was standing open slightly, but she finally got the card out of the back of the drawer and used it. When she took the card to put it back in the file and replace it, she could not get the file cabinet to close. She bent over and pushed on the cabinet, but it would not close. She then attempted to push the drawer with her foot while she was bent over, and while she was doing this something pulled in her back which brought on a stinging, burning sensation. The file was not closed. The incident occurred about 10:30 a.m., on August 8, 1967, and the plaintiff told a co-employee that she had hurt her back. The next day she sat down too hard on a metal chair and again felt pain in her back. She reported this incident and the occurrence of the previous day to her supervisor and left work, because she felt ill.
*498 Plaintiff promptly went to Dr. W. J. Williamson, a doctor who had treated her before for various ailments, and he hospitalized her in Twelve Oaks Hospital where she remained for about nine days. Plaintiff told Dr. Williamson of the above incidents which had occurred at work, but the doctor did not advise plaintiff that the file cabinet incident or the chair incident were responsible for her back trouble. Dr. Williamson told her that her trouble was mostly "job pressure." He did not tell her that the accident was the cause of her difficulties. She did not believe the trouble she was having with her back was the result of the uneventful file cabinet incident. When no improvement resulted from Dr. Williamson's treatment, Mrs. Maines sought treatment from Dr. C. B. Lawrence, who had been her family doctor for many years. Plaintiff again related to the doctor an account of the circumstances, including the file cabinet incident. Dr. Lawrence treated her from about September 1, 1967 until January, 1968 with therapy and injections of vitamin B-12. Dr. Lawrence apparently did not relate or connect plaintiff's back pains with the incidents which occurred on the job. Instead he told her she was suffering from muscle spasm and "job pressure."
Mrs. Maines returned to work in January, 1968 but continued to have back pain. She then went to a chiropractor, Dr. Gariepy, who was again told all the facts. He, however, apparently never related her back trouble to the incident with the file cabinet. In March, 1968, plaintiff sought help from Dr. Keith Peavey and Dr. Arnold, and she was hospitalized again. Plaintiff again gave the facts to the doctors. She was hospitalized for one week in Diagnostic Center Hospital. After tests were made in the hospital plaintiff was advised that she had degenerative disc disease. Plaintiff told a Mr. Wilhite, her supervisor at work, who discussed her physical condition with her, that she was getting a different answer from every doctor she consulted.
In September, 1968, plaintiff consulted Dr. Alexander Brodsky. She again recounted the incidents at work concerning the file cabinet. Dr. Brodsky hospitalized plaintiff, conducted a myelogram and a discogram and found a midline L-5 S-1 disc protrusion with posterior rupture and extrusion. Dr. Brodsky operated on plaintiff's back on September 25, 1968, and while he testified that he had good results they were not remarkable and that the plaintiff had not ceased making complaints of pain. He told Mrs. Maines that her back trouble was causally connected with the occurrences on the job which she had related to him and so testified.
When plaintiff learned the true facts, she made preparations to file her claim with the Industrial Accident Board. The claim was filed and received by the Board on November 26, 1968, more than nine months following the normal expiration of the six-month requirement for filing under the statute. See. Art. 8307, Sec. 4a, Vernon's Ann.Tex.St. Plaintiff had never had trouble with her back prior to August 8, 1967 when she allegedly injured in while at work. Plaintiff called her sears supervisor from the hospital and reported the new developments to him. When she was released from the hospital, she went to an official at Sears and secured his agreement that he would file a claim for her. Next, approximately one month later, when she learned that Sears had not filed her claim as agreed, she promptly consulted her attorney on November 19, 1968, and a claim was promptly filed.
Plaintiff further testified that she knew her back hurt, but that she believed that there was nothing wrong that mattered too much. She knew there was something wrong with her, but the doctors kept assuring her that she would be all right. She hoped that she would get well and be on her feet again, and she testified that she did not suffer excruciating pain all the time. At Twelve Oaks Hospital the doctor said that the expected to see a 100-year old *499 back, but instead he saw nothing from the X-rays. She stated that she considered it improper to file a compensation claim for degenerative disc disease or muscle spasm, and that to say she was hurt when she thought she had degenerative disc disease or muscle spasm, something that in her opinion one can overcome, would not have been right. Most of the excruciating pain came on afterwards, and it grew worse.
It was stipulated that the plaintiff attempted to return to work in January of 1969 after her surgery but was not permitted to do so. She has not been allowed to return to Sears as an employee since. Plaintiff moved to Lubbock in early 1970. She still has pain in her back and complains continually concerning it. She can do only light housework. Since she left work at Sears she has attempted to obtain work at five or six places, but she has been turned down each time. She has consulted and obtained treatment of her back from Dr. Batson of Lubbock since her operation. Dr. Brodsky testified that some employers will not employ a person in plaintiff's condition, but that some of them will. There is no fixed rule, there are variations as to employability, and it generally depends upon the individual employer and the condition of the employee. The last time the doctor saw plaintiff was January 19, 1970.
Defendant contends that plaintiff suffered an injury; there was severe back pain following the injury; and there was never any back pain before the injury. Therefore, it is contended, plaintiff's claim that she needed a medical recitation with respect to her anatomy before she filed her claim is without reason when logic of the simplest nature was there to guide her. Moreover, it is contended that plaintiff did not inquire of the doctors as to the cause of her back condition, citing Texas Employers' Insurance Association v. Leathers, 395 S.W.2d 601 (Tex.Sup.). In Leathers, the injury occurred in 1954 and the claim was filed in 1962. The burden there was to explain a delay of more than seven years. Further, the evidence in Leathers was that the claimant's decision finally to file his claim was not based on medical opinions but on the advice of his brother, a layman. Leathers did not mention to his doctor in late 1955 about the accident of November 11, 1954 and did not inquire as to the cause of his condition, dizziness and blackout spells allegedly caused by facial burns in the accident of 1954.
In the instant case we believe that Mrs. Maines' conduct was consistent and was diligent. She told the doctors all the facts, including the apparently minor and undramatic incident with the file cabinet on August 8, 1967. But defendant contends that it was her duty to ask the doctors what was causing her back trouble. When true facts are given to a doctor or doctors as were given in this case, and the doctor diagnoses a condition as being caused by something other than an industrial accident, such as ordinary "muscle spasm," "job pressure," or "degenerative disc disease," it is not plaintiff's legal or absolute duty to ask the doctor specifically anything further to show reasonable diligence. This is a matter for jury consideration, and we believe this case is clearly distinguishable from the Leathers case above. Plaintiff's accident and the injury and disability which resulted involved no visible changes in her body which a layman could reasonably be expected to understand. In Hawkins v. Safety Casualty Co., 146 Tex. 381, 207 S.W.2d 370, 373 (Tex.Sup.), it was said:
"The injuries of the claimant were in the joints of his knee, shoulder and spine. They were not open and visible to him, and their severity and true character were to be revealed only by the most minute, technical and scientific examinations by medical experts."
See Hayes v. Commercial Standard Ins. Co., 140 S.W.2d 250 (Tex.Civ.App.), aff'd, 135 Tex. 288, 142 S.W.2d 897 (Tex.Sup.). Whether a claimant has used that degree of diligence required by law is ordinarily a question of fact to be determined by a jury *500 or a trier of facts. It may be determined against the claimant as a matter of law only when the evidence, construed most favorably for the claimant, admits no other reasonable conclusion. The above rule has often been quoted in the decisions of this state. See Hawkins v. Safety Casualty Co., supra; Moronko v. Consolidated Mutual Insurance Co., 435 S.W.2d 846, 847 (Tex.Sup.). The latter case above holds in part that in determining ordinary prudence which would justify the filing of a compensation claim subsequent to the expiration of the statutory time, the totality of claimant's conduct must be considered.
We believe the evidence and lawful inferences therefrom show that plaintiff was not trying to find an excuse to file a claim, but on the contrary she was genuinely trying to discover what was wrong with her. She did know her back hurt, and she did know of the incidents with the file cabinet and chair. But she did not know whether the two facts were causally connected. She prudently consulted physicians, and no interval of delay is shown in the record. She obtained varying diagnoses, but not one of them, until she consulted with Dr. Brodsky, accorded the crucial significance to the encounter with the file cabinet. We hold that plaintiff was not required, as a matter of law, to recognize the causal connection between her undramatic push on a file cabinet and the disabling back pain which ensued over the next few months. These are fact questions, and they may not be decided against plaintiff as a matter of law. When plaintiff was informed of the real facts of her case, she acted with promptness and diligence. See Moronko, supra; Texas Employers Ins. Ass'n v. Fowler, 140 S.W.2d 545, 552 (Tex.Civ.App.) writ ref.; Traders & General Ins. Co. v. Jacques, 131 S.W.2d 133 (Tex.Civ.App.), writ dismd., judge. corr.; Texas Employers Ins. Ass'n v. Little, 96 S.W.2d 677 (Tex.Civ.App.), writ dismd.; King v. Texas Employers' Insurance Association, 416 S.W.2d 533 (Tex. Civ.App.), no writ. And see Great American Indemnity Company v. Britton, 86 U. S.App.D.C. 44, 179 F.2d 60 (1949), where it was said:
"We cannot place a premium on the filing of claims which fly in the face of professional advice and ethical standards."
We hold that the jury's findings on good cause as contained in special issues number 12, 13 and 14 are supported by the evidence under the circumstances of this case.
Appellant further attacks the finding of the jury to special issue number 4 concerning total permanent disability as having no support in the evidence. We overrule such contention. The evidence concerning this point is briefly summarized above. The testimony shows that Mrs. Maines' employer would not take her back as an employee; that other employers turned her down; that a portion of her back was surgically removed; and that since the surgery plaintiff experiences substantial, unchanging and persistent pain and physical disability. Lay testimony was not contradicted by Dr. Brodsky. The jury found that her total incapacity was permanent, and we decline to disturb such finding under these circumstances. Texas Employers' Insurance Ass'n v. Washington, 437 S.W.2d 340 (Tex.Civ.App.), writ ref., n.r.e.; Travelers Insurance Company v. Wade, 373 S.W.2d 881 (Tex.Civ.App.), writ ref., n.r.e. Although the questions are close, the Workmen's Compensation Act is required to be liberally construed in favor of the claimant. Hargrove v. Trinity Universal Ins. Co., 256 S.W.2d 73, (Tex.Sup.).
The evidence supports the jury's findings in this case, and the testimony and findings were not so contrary to the great weight and preponderance of the evidence as to be manifestly unjust.
The judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534352/ | 468 S.W.2d 85 (1971)
Gonzalo GONZALEZ, Appellant,
v.
The STATE of Texas, Appellee.
Raymond GONZALEZ, Appellant,
v.
The STATE of Texas, Appellee.
Nos. 43717, 43718.
Court of Criminal Appeals of Texas.
May 19, 1971.
Rehearings Denied June 23, 1971.
Robert B. Billings, F. T. Gauen, Dallas, for appellant.
Henry Wade, Dist. Atty., John B. Tolle, Harry J. Schulz, Jr., W. T. Westmoreland, Jr. and Edgar A. Mason, Asst. Dist. Attys., Dallas, and Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
DOUGLAS, Judge.
The appeals are from convictions for murder without malice after a joint trial. The punishment of each appellant was assessed by the jury at five years.
The evidence viewed in the light most favorable to the verdicts shows that on the 26th day of October, 1968, Felix Gomez, the deceased, and David Gomez were working on a car in the backyard at Felix's home in Dallas. In the afternoon Oscar Flores who had just been discharged from the military service came by for a visit. Some of the neighbors gathered in front of the house to see Oscar.
*86 Gonzalo and Raymond Gonzalez, the appellants, drove up in Raymond's car, got out and greeted Oscar. After they were there about ten minutes an argument developed. Felix told David to go into the house and then followed him inside. Felix then told David to get the shotgun and later told him to stay in the house with the gun because it appeared there was going to be trouble.
David testified that Raymond drove away, and later David looked outside when Felix left the house and saw that Raymond had returned in his car and that Gonzalo was standing in the street with a shotgun. Felix proceeded toward the street and as he reached the ditch in front of his house and started to pick up a beer, Gonzalo shot Felix in the left side in the armpit. Felix fell into the ditch and Gonzalo shot at him four more times. While this shooting was going on, David ran outside and shot at Gonzalo one time but missed. Then David's gun jammed.
Raymond then shot David in the hand with a .38 caliber pistol causing him to drop the gun. As David ran, Raymond shot at him two more times. In the meantime, Nellie Gomez, the wife of Felix, came outside their house and screamed to Gonzalo to stop shooting at her husband. Raymond then pointed the pistol at Nellie and told her to go back in the house or he would shoot her. She followed his instructions. Raymond then ran to where David had dropped his gun, picked it up and took it with him. He testified that he did so because he wanted it for evidence in the case.
After emptying his gun at Felix, Gonzalo ran down the block between two houses. Raymond came by, picked him up and they drove away.
Officer Head, who arrived at the scene shortly after the shooting, testified that he found five spent 12-gauge shotgun shells, all within a four feet radius of each other. He testified that he found no weapons around the deceased (Felix) during the search of the scene.
David and Nellie both testified that the deceased was unarmed.
The cause of death was shown to have been by shotgun pellets destroying both the lungs and the heart of the deceased.
The testimony of Gonzalo and Raymond was substantially the same as that of the State up to the point where the argument started. Their testimony was to the effect that Felix was trying to pick fights with everyone present, and Gonzalo did not want to fight. Gonzalo testified that he stated walking away and Felix pulled a pistol and started shooting at him; that at this time Raymond drove up and Gonzalo ran, got the shotgun from the car and started shooting at Felix; and that during this time Gonzalo was running backwards to get away.
The jury chose not to believe the testimony of the appellants.
The appellants filed a brief containing some 79 grounds of error. No summation of the facts appears in the brief. No authority has been cited and no argument in support of any ground has been submitted. Many of the grounds of error are one sentence long and are of the conclusory-type with references to certain page numbers of the record.
Article 40.09, Section 9, Vernon's Ann. C.C.P., provides, in part:
"This brief shall set forth separately each ground of error of which defendant desires to complain on appeal and may set forth such arguments as he deems appropriate. Each ground of error shall briefly refer to that part of the ruling of the trial court, charge given to the jury, or charge refused, admission or rejection of evidence or other proceedings which are designated to be complained of in such way as that the point of objection can be clearly identified and understood by the court."
*87 In Alexander v. State, 458 S.W.2d 656, this Court stated:
"Neither the trial court nor this court, with its crushing case load, should be expected to examine and re-examine an appellate record trying to determine and speculate on the true meaning of appellant's contentions advanced without argument, reasoning or authorities."
The appellants included several grounds of error complaining that the evidence is insufficient to support the convictions. The testimony shows that the appellants were acting as principals and is sufficient to support the convictions.
Appellants complain that the court erred in overruling their motions to quash the indictments and their motions to quash the petit jury on the grounds that no one of the Latin-American race was on the grand jury or petit jury.
Neither of the motions was sworn to nor supported by an affidavit by the appellants or anyone else. The motions, therefore, do not comply with Article 35.07, V.A.C.C.P.
Further, no evidence appears in the record to support either motion. Nothing has been presented for review.
The appellants complain in their briefs and argument before this Court that the court erred in not granting the motions to shuffle the entire central jury panel. The motions to shuffle, omitting the formal parts, read:
"Comes now the defendant * * * in the above entitled and numbered cause and moves the Court, in accordance with C.C.P. 35.11 to cause the names of all the members of the general panel drawn or assigned as jurors in this case to be placed in a receptacle and well-shaken, and have the clerk draw therefrom the names of a sufficient number of jurors from which a jury may be selected to try such case, and order said clerk to be written, in the order drawn, on the jury list from which the jury is to be selected to try this case, and to write the names as drawn upon two slips of paper and deliver one slip to the State's counsel and the other to the defendant's attorney."
The trial judge noted that he was unable to get all of the central jury panel cards because other courts had already drawn from the central panel, but the panel of forty-five for which he had cards were shuffled.
The court granted all of the appellants' requests and fully complied with Article 35.11, V.A.C.C.P., in shuffling the cards containing the names of those assigned as jurors in such case.
To require a shuffling of all cards of those in the entire central jury panel (perhaps a thousand prospective jurors) in each case would be an impossibility for each trial court in a large city. The Legislature did not provide for such a procedure.
No error has been shown.
The appellants also complain that the court erred in giving separate charges to the jury and refusing to combine the charges.
The appellants were charged in separate indictments but were tried jointly. The trial court adopted the better and preferred practice of submitting separate charges to the jury. In joint trials, defenses are often different as they were in this trial. Separate charges help prevent confusion and better enable a jury to reach proper verdicts. Mayzone v. State, 88 Tex. Crim. 98, 225 S.W. 55, involved a joint trial and only one charge was submitted to the jury. This Court held that separate charges should have been given.[1]
*88 No error has been shown.
The instructions of the court adequately covered the issues raised by the evidence and protected the rights of the appellants. A discussion of the contentions about the court's instructions would add nothing to the jurisprudence of this State and would add only to the length of this opinion. They do not reflect reversible error.
The entire records have been reviewed and no reversible error appears.
The judgments are affirmed.
NOTES
[1] These separate appeals arose out of a joint trial. Two identical transcriptions of the court reporter's notes, consisting of 718 pages, were filed with the Clerk of this Court at the same time. Article 40.09, Section 5, V.A.C.C.P., provides that a party desiring to have included in the record a transcription of the notes of the reporter shall have the responsibility of obtaining such transcription to the Clerk in duplicate.
The statute is not clear how many transcriptions of such notes are required in this Court where there is more than one applicant. In the future cases where the records reach this Court at the same time, only one transcription of the reporter's notes of the joint trial will be required and the cases to the contrary under previous statutes will not apply. This will save expenses on behalf of appellants and the State. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534362/ | 468 S.W.2d 54 (1971)
SHAWNEETOWN FEED AND SEED COMPANY, a corporation, Plaintiff-Appellant,
v.
R. N. FORD and Clara Marie Ford (Mrs. R. N. Ford), Defendants-Respondents.
No. 33895.
St. Louis Court of Appeals, Missouri.
April 27, 1971.
Motion for Rehearing or to Transfer Denied May 25, 1971.
*55 Buerkle & Lowes, Jackson, for plaintiff-appellant.
Kenneth W. Shrum, Marble Hill, for defendants-respondents.
Motion for Rehearing or to Transfer to Supreme Court Denied May 25, 1971.
WOLFE, Judge.
This is an action brought on an account owing for seed corn against R. N. Ford who operated a combination grocery, feed and grain store. His wife, Clara Marie Ford, was joined as a party defendant on the theory that she was a partner in the business. A jury was waived and the trial was to the court. At the close of plaintiff's case the court sustained a motion to dismiss as to Mrs. Ford. Defendants rested their case without putting on any evidence and a judgment of $1,000 with interest was entered against R. N. Ford. The plaintiff corporation appealed, contending that the judgment should have been entered against both defendants.
There is no question before us relating to the amount owing to the plaintiff for the grain purchased. The points raised by the plaintiff all relate to the court dismissing as to Clara Marie Ford. It is contended here as it was below that the plaintiff made a prima facie showing that Ford and his wife were partners in the operation of the store and that the judgment should have been entered against both of them and not against R. N. Ford alone.
The testimony given by the officers of plaintiff corporation was that they had an account under the name of Ford Grocery and that payment was made to them by check. Printed at the top of the checks was R. N. Ford Grocery and Feed and Grain. They did not know whether Mrs. Ford signed any of the checks they received, but she did sign some. Neither did they know anything about the account that they were serving except that they carried it as Ford Grocery Company. No one testified that the defendants were partners in the operation of the store.
There was evidence that the Fords had a bank account at the Bollinger County Bank and another account at the Bank of Marble Hill, Missouri. Either party was authorized to sign checks on the accounts. A deposition of Mrs. Ford was offered in evidence by the plaintiff against interest. She stated in the deposition that both she and her husband had worked in the store together and that he kept the books. She did, however, occasionally write checks in payment of items delivered to the store. They both owned the store building and lived back of it until recent times when they moved to another house owned by both of them. She received no salary for her work but just worked "to help out." She drew upon the joint bank account for family expenses. The store had been closed prior to the time of trial but for about a year before it closed Mr. Ford had been working as a truck driver and Mrs. Ford was in the store most of the time.
In contending that the court erred in dismissing the action as to Mrs. Ford, it is first asserted that the existence of a partnership was not disputed. The plaintiff relies upon Civil Rule 55.16, V.A.M.R., which provides: "When parties sue or are sued as a partnership, and the names of the partners are set forth in the petition or counterclaim, the existence of the partnership shall be deemed confessed unless it is denied by specific negative averment, which shall include such supporting particulars as are peculiarly within the pleader's knowledge." We do not see how the rule aids the plaintiff's contention for the answer filed by the defendant states: "* * * Mrs. R. N. Ford, is not the owner, operator or partner or in any other way connected with Ford's Grocery Store or any other business in Bollinger County, Missouri." And: "* * * Defendants state that Mrs. R. N. Ford is, in no way, an owner, operator or partner in Ford's Grocery Store, but that Mr. R. N. Ford is the sole and only owner, operator, and manager of Ford's Grocery Store which is located in Bollinger County, Missouri." *56 This quite adequately denies the partnership and put in issue the question of its existence.
It is next asserted that the evidence presented by plaintiff made prima facie proof of a partnership. This assertion is predicated in part upon § 358.070(4), RSMo 1959, V.A.M.S., which states: "The receipt by a person of a share of the profits of a business is prima facie evidence that he is a partner in the business, but no such inference shall be drawn if such profits were received in payment: * * *." This section is without application of the facts here considered. There is no evidence Mrs. Ford shared in the profits of the store. She drew from the checking accounts for family expenses but this was not for herself and was nothing more than the use of her husband's funds, with his consent, to carry out his obligation as a husband and father to support his family. Nor is there any proof that the Ford Grocery showed any profit.
Partnership must be proven by clear and convincing evidence. As in cases seeking to hold a husband and wife as joint adventurers, the joint maintenance of a home by a husband and wife does not create a partnership, nor does the ownership of property by husband and wife as tenants by the entirety. Fish v. Fish, Mo.App., 307 S.W.2d 46, 1. c. 52. A partnership does not arise necessarily by reason of a wife working in her husband's place of business, particularly when she works simply to "help out." Miller v. Miller, 311 Mo. 110, 277 S.W. 922. As stated in Fish v. Fish, supra, in husband and wife cases the very nature of the relationship of parties tends to submerge adversity of individual interests. Prasse v. Prasse, Mo., 77 S.W.2d 1001; Johnson v. Johnson, Mo.App., 270 S.W.2d 65; State ex rel. Sirna v. Johnson, Mo.App., 287 S.W.2d 114; Cooper v. Freer, Mo.App., 385 S.W.2d 340. For the reasons stated, the plaintiff's evidence failed to establish the existence of a partnership between Ford and his wife.
As above set out, at the conclusion of the plaintiff's case, defendants moved to dismiss as to defendant Mrs. R. N. Ford and the court stated: "Motion to Dismiss as to defendant Mrs. R. N. Ford is sustained. I don't think you can consider he had a joint bank account with her. She had authority to write checks. She was helping him run his grocery store."
The defendants then rested their case and thereafter the attorney for the plaintiff stated: "We would like a finding of fact." The court replied: "You asked for that too late," and entered judgment against Mr. R. N. Ford. It is contended that the action of the court was in violation of Civil Rule 73.01, V.A.M.R., which requires the court to "* * * dictate to the court reporter, or prepare and file a brief opinion containing a statement of the grounds for its decision * * * and may, or if specifically requested by counsel, shall, include its findings on any of the principal controverted fact issues. * * *." (Emphasis ours.) The statement made by the court was sufficient compliance with the rule. The evidence here presented no controverted fact issue. The question before the court was whether the only facts presented established in law a partnership and it properly found that they did not. State ex rel. O'Brien v. Petry, Mo.App., 397 S.W.2d 1.
Judgment is affirmed.
BRADY, P. J., and DOWD, J., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534357/ | 468 S.W.2d 513 (1971)
John H. ANDES, Appellant,
v.
Carole Andes CAGLE et al., Appellees.
No. 473.
Court of Civil Appeals of Texas, Houston (14th Dist.).
May 26, 1971.
Rehearing Denied June 16, 1971.
*514 William Dickson, Dickson & Associates, Houston, for appellant.
Decatur J. Holcombe, Underwood & Holcombe, J. E. Tatum, David A. Gibson and J. E. Tatum, Houston, for appellees.
SAM D. JOHNSON, Justice.
John N. Andes, the appellant, instituted this suit for the restitution of shares of certain stock against the appellees, Carole Andes Cagle, Harry W. Cagle and Investors Diversified Services, Inc. The pertinent facts relative to a marriage, divorce and the ownership of property must be set forth in order to understand the contentions of the parties.
The appellant, John N. Andes, and the appellee, Carole Andes Cagle, were married in 1955, and divorced in December of 1961. One son, Rob Roy Andes, was born to this marriage. In February, 1960, John Andes and Carole Andes Cagle paid $8,000 to the appellee, Investors Diversified Services, Inc., for shares of stock acquired under two separate accounts. Both accounts listed John Andes as the shareholder and Carole A. Andes as a joint tenant. The account designated number "014" contained in excess of 660 shares in the Variable Payment Fund, Inc.; the account designated number "023" contained in excess of 238 shares in Investors Stock Fund, Inc. The appellant alleged that these accounts were purchased with funds from his separate property, that the divorce decree made no determination regarding the accounts and that the appellees, without the knowledge or consent of the appellant, effectively deprived him of his stock in the accounts. The trial of this case was to a jury in the District Court of Harris County, Texas, in August, 1970. After the appellant rested his case, the trial court granted the appellees' motion for instructed verdict and entered judgment that the appellant take nothing. The appellant, John Andes, perfects this appeal.
Carole Andes Cagle was married to Floyd Neageli before she married Andes. Two children were born of this marriage. Neageli died in 1952 and left insurance policies for the benefit of Carole Andes Cagle and the two minor children. Carole Andes Cagle testified that at the time of her marriage to Andes she had certain monies. She received insurance payments for the benefit of her two children during the first years of marriage to Andes. Carole Andes Cagle testified that she withdrew the funds from her childrens' savings account and deposited such funds in a joint account. Carole Andes Cagle also worked periodically as a secretary while married to Andes.
John Andes, at the time of his marriage to Carole Andes Cagle, owned approximately $20,000. Sixteen thousand dollars was invested in a house, which was sold subsequent to the marriage. The monies received from the sale of this house were used in a series of transactions involving the buying and selling of at least five properties. It was Andes' position that he and Carole Andes Cagle ultimately purchased the "023" and "014" accounts with funds received from the sale of properties which had been purchased with his separate property.
*515 On November 12, 1960, Carole Andes Cagle signed John Andes' name and her own name on forms authorizing the transfer of the "014" account into three accounts, 034, 044 and 054. She testified that such transfer was for the benefit of her three minor children (two by Naegeli and one by Andes) and in such transfer Carole A. Andes' name was listed as "custodian" for the children. On December 19, 1960, John Andes returned the confirmation of the transfer of the "014" account to Investors Diversified Services, Inc., and made inquiry with reference to the change of names on the account. In August, 1961, Carole Andes Cagle authorized the sale of the shares of stock in the childrens' 034, 044 and 054 accounts and Investors Diversified Services, Inc., sent checks to Carole Andes Cagle for these accounts in the amounts of $2,067.14, $1,241.12 and $2,067.14. Carole Andes Cagle deposited these checks in her separate bank account and later withdrew these funds from the bank and invested them in the Cagle Construction Company. She testified that she thereafter withdrew the funds from the construction company and used them for living expenses.
The 023 account was transferred by John Andes and Carole A. Andes on May 11, 1961 into an 063 account in the name of Carole A. Andes, as trustee for John Andes. Andes testified that he recognized his signature on the application for transfer of the 023 account into the 063 account. The 063 account was then pledged to a bank as collateral for a home improvement loan. John Andes admitted signing a letter dated June 30, 1961, requesting Investors Stock Fund, Inc. to issue a certificate in Investors Stock Fund in Carole A. Andes' name and requesting it be sent to a local bank on account of a loan made with the bank and secured by the stock. On October 6, 1961, a letter bearing the signatures of John Andes and Carole A. Andes authorized and instructed the bank to sell the shares of Investors Stock Fund that the bank was holding as collateral on the note. The bank was instructed to deposit the full amount from the sale in a checking account and deduct from the account the amount necessary to pay off the principal and interest on the note. Carole Andes Cagle testified that the excess from the sale of this stock was deposited in John Andes' separate bank account. All of the foregoing applications, exchanges, sales and transfers were made before the divorce of John Andes and Carole A. Andes.
In November, 1961, John Andes and Carole Andes Cagle entered into an extensive property settlement which partitioned the house in Houston, furniture, an automobile, property owned in California, an interest owned in a New Jersey trust, a promissory note payable to the parties jointly, retirement funds, pension plans and pension and retirement trust plans. The settlement agreement provided that "the parties hereto are desirous of dividing any and all property, whether real, or personal, accumulated during their marriage." This agreement stated that "any properties now owned by the parties not provided for herein are to be deemed jointly owned."
The appellant John Andes apparently contends that the 014 and 023 accounts constituted property which would have been subject to division at the time of the divorce decree. The record is clear, however, that the 014 and 023 accounts were no longer in existence at the time of the property division and divorce. Not being in existence at the divorce they could not be divided between the parties. Both of these accounts had been subject to transfer, exchange and sale prior to such time. The property settlement agreement of the divorce was signed by the appellant with knowledge of the transfer of the 014 and the 023 accounts. Appellant cannot now claim an interest in the two accounts because these were matters which belonged to the subject of the divorce litigation. "The plea of res judicata applies not only to points upon which the court was actually required to pronounce judgment, but to every point which properly belonged to the *516 subject of litigation, and which the parties, by exercising reasonable diligence, might have brought forward at the time." Ladd v. Ladd, Tex.Civ.App., 402 S.W.2d 940, 942, writ ref., n.r.e.
We hold that the trial court properly withdrew the case from the jury because the evidence conclusively established that the rights of the appellant John Andes and the appellee Carole Andes Cagle, had been finally adjudicated by the divorce decree of December 8, 1961.
There are at least two additional reasons why appellant's contentions must be overruled. The appellant's first allegation in his first amended original petition which relates only to Investors Diversified Services, Inc., is that the Variable Payment Fund, Inc. and Investors Stock Fund, Inc., were mutual funds owned by the appellee Investors Diversified Services, Inc. The application for the purchase of the shares of stock in these mutual funds provided that "Investors Diversified Services, Inc., acts as broker for issuer in this transaction." The record is devoid of evidence that these mutual funds were owned by Investors Diversified, Inc., or otherwise had the same identity. Moreover, the appellant has cited no authority which under any circumstances would require that a transfer agent, or broker for the issuer such as Investors Diversified Services, may be required to make restitution of shares of stock in another corporation.
The additional reason for our rejection of appellant's contentions involves the statute of limitations. The record shows that suit was filed on November 12, 1964. Appellant first learned of the alleged unauthorized transfer of the 014 account on December 19, 1960 and executed the transfer of the 023 account on May 11, 1961. The appellant contends that the four-year statute of limitations is applicable to this factual situation and cites Arts. 5527(1) and 5529.
Art. 5527(1) provides that all actions for debt where the indebtedness is evidenced by or founded upon any contract in writing shall be commenced and prosecuted within four years after the cause of action shall have accrued. The appellant argues that the shares of stock are written evidence of ownership in the corporation, and the alleged fraudulent transfer of stock out of appellant's name were upon a written instrument. The appellee, Investors Diversified Services, was named in an agreement as the broker for the issuer of the stock. There was no enumeration of any rights or obligation assumed by the appellee Investors Diversified Services. Under Texas law, where an agreement fails to set out specifically the obligations, the violation of which form the basis of a suit, it is considered to be an oral agreement subject to the two-year statute of limitations. Las Mendozas, Inc. v. Powell, 368 F.2d 445 (5th Cir. 1966); Shaw v. Bush, Tex.Civ.App., 61 S.W.2d 526, writ ref.; Cowart v. Russell, 135 Tex. 562, 144 S.W.2d 249 (Tex.Com.App.); Jordan v. Concho Theatres, Tex.Civ.App., 160 S.W.2d 275, no writ hist.
Art. 5529 provides that an action other than one for the recovery of real estate, for which no limitation is otherwise prescribed, shall be brought within four years after the right to bring it shall have accrued. This article is clearly inapplicable because the factual situation presented in this case is controlled by Art. 5526. Art. 5526 provides that "actions for debt where the indebtedness is not evidenced by a contract in writing" and "actions for detaining the personal property of another, and for converting such property to one's own use" must be commenced and prosecuted within two years after the accrual of the cause of action.
It is well settled that this two-year statute of limitation applies to misconduct of an agent, even though a written contract may have been involved. Las Mendozas, Inc. v. Powell, supra; Gordon v. *517 Rhodes and Daniel, 102 Tex. 300, 116 S.W. 40 (Tex.Sup.Ct.); Adams v. San Antonio Life Ins. Co., Tex.Civ.App., 185 S.W. 610, writ ref.; Mutual Life Ins. Co. of New York v. Garland, 23 Tex. Civ. App. 380, 56 S.W. 551, no writ hist.
We hold that the two-year statute of limitations was applicable to appellant's cause of action as to the appellee Investors Diversified Services, Inc. The trial court properly withdrew the case from the jury because the evidence established that the appellant's cause of action was barred by the two-year statute of limitations.
Because the appellant has, as a matter of law, failed to establish a cause of action against the appellees, the judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534355/ | 468 S.W.2d 277 (1971)
Thomas E. DOLAN, Jr., Appellant,
v.
COMMONWEALTH of Kentucky, Appellee.
Court of Appeals of Kentucky.
June 4, 1971.
*279 Eugene H. Alvey, Henry P. Gaddie, Louisville, for appellant.
John B. Breckinridge, Atty. Gen., Mark F. Armstrong, Asst. Atty. Gen., Frankfort, for appellee.
VANCE, Commissioner.
The appellant was convicted of murder and sentenced to life imprisonment. On appeal he claims (1) the trial court erred in admitting evidence of a purported confession (2) the evidence was not sufficient to sustain the verdict (3) the court failed to instruct on the whole law of the case and (4) the court erred in overruling appellant's motion for a new trial on the ground of newly discovered evidence.
The appellant and his wife, Genevieve Dolan, resided in the home of appellant's father and mother in Jefferson County, Kentucky. On Easter Sunday, April 6, 1969, Genevieve Dolan was wounded by a pistol shot in the bedroom of the home. She died at a Louisville hospital at approximately 4:00 P.M. the same day. The pistol shot entered her head at the left temple and ranged upward through her brain. It was fired from close range and left powder burns surrounding the wound.
*280 The week before the shooting, the appellant discovered his wife kissing another man; he struck her in the face, blacked her eyes and threatened to divorce her and take custody of their infant children. There was some evidence that the deceased was despondent and depressed and taking tranquilizers on prescription of a physician. There was also some evidence that the couple had become reconciled during the week preceding her death.
An Easter card was found in the room in which the deceased was shot. It was addressed to "Eddie" and the card contained the following message in the handwriting of the deceased.
"Honey
"On this Easter Sunday I know of the heartaches you have. With God's help you will be happy again! Without you my life musn't go on. With love in my heart I ask God to make you happy & some day bless you. You are my life. With love to you on Easter.
Love Genny"
The police officer on duty at police headquarters on April 6, 1969, testified that he received a telephone call from a man who identified himself as Thomas Dolan, Sr., and reported "That his son had shot his wife." Appellant's father testified that he reported to the police dispatcher that his son's wife had been shot.
The police were dispatched to the Dolan home and testified that upon arrival at the home the appellant made the following statement:
"I didn't mean to do it. I only meant to scare her."
Both parents denied that appellant made this statement. They testified he said, "Why did she do it" or words to that effect.
The injured Genevieve Dolan was removed to the hospital where she died shortly thereafter. At the hospital the appellant told a police officer "That his wife was lying on the bed face down and he was lying beside her. He stated he had the gun in his hand and he attempted to unload the gun but in pulling the slide back on the gun the safety slipped, the slide went forward and the gun discharged."
The appellant denied making any voluntary admission of the shooting. He testified that he was so upset and distraught that he could not remember what was said by him either at the home or at the hospital. He testified that he and his wife went driving Easter Sunday afternoon, arriving home about 2:30 P.M. They entered the house through the kitchen. At that time his father was seated upon the steps just outside the kitchen and his mother was preparing a meal. He stopped at the kitchen table while his wife went on to the bedroom. When the meal was ready he went to the bedroom to call his wife and discovered she had been shot. He commenced screaming and both parents immediately rushed to the bedroom.
Both parents corroborated this version of the incident. Although a noise similar to a shot was heard shortly before the discovery, nobody paid any attention to it because outside the house a group of motorcyclists were revving up the engines of their motorcycles, causing many noises similar to pistol shots.
The first contention raised by appellant is that the trial court improperly admitted evidence of his confession. He claims the confession was not voluntarily given and also that he had not been advised of his constitutional rights by the police officers.
The basis of the attack upon the voluntariness of the confession is two-fold, first, that the appellant was so upset, distraught and incoherent that he did not know what he was saying and second that sedatives were given to him at the hospital and any statement thereafter made was not freely given.
There is no intimation that the confession was coerced. The appellant was not *281 in custody and his statements were made in his home and in the hospital and not in a jail or police station. There is no evidence of any prolonged questioning or any conduct on the part of the officers to overcome his will. His statement at the hospital was given in response to a general inquiry as to what had happened.
It is now claimed that the statement was not freely given because he was not coherent at the time but there is no evidence that he was wildly irrational or unaware of what he was saying or doing. Admittedly he was upset but the testimony of the police officers indicates that they could understand the appellant and that he could understand them.
Evidence that a defendant was upset, hysterical, excited or distressed at the time of making a statement or confession does not render the statement involuntary or inadmissible but goes instead to the weight which a jury will give it. State v. Foster, 44 Haw. 403, 354 P.2d 960 (1960); 2 Wharton's Criminal Evidence, 12th Edition, Section 386, pages 118, 121; 23 C.J.S. Criminal Law § 828, Mental or Physical Incapacity, pages 226, 230.
The claim that appellant was sedated when he gave his statement rests upon inferences rather than direct proof. There is no direct evidence that a sedative was administered to the appellant. If a sedative was administered, there is no suggestion in the evidence as to what it contained or what effect it had upon the appellant. There is simply no showing to sustain the claim that the appellant was under the influence of drugs at the time his statement was made.
The appellant contends that he was not warned of his constitutional rights. The court conducted an inquiry out of the hearing of the jury in which it was shown that the officer at the hospital carefully explained appellant's constitutional rights as required by Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966). All statements made by the appellant before such warnings were given were excluded from evidence by the trial court. We think the action of the trial court in this respect was proper and we conclude that there was no abuse of discretion or error on the part of the trial judge in admitting the statements made by the appellant to police officers.
The claim that the verdict is not supported by the evidence is predicated upon RCr 9.60 which reads:
"A confession of a defendant, unless made in open court, will not warrant a conviction unless accompanied with other proof that such an offense was committed."
The language of RCr 9.60 is identical to former Criminal Code, Section 240. Those sections have been interpreted uniformly to require an instruction in the language of the rule in any case in which an out-of-court confession was admitted in evidence unless the confession was accompanied by other proof, independent of the confession, that a crime had been committed. Hawk v. Commonwealth, 284 Ky. 217, 144 S.W.2d 496 (1940).
A distinction has been drawn between confessions and admissions against interest. When the out-of-court statement amounts to no more than an admission against interest no such instructions need be given. Herron v. Commonwealth, 247 Ky. 220, 56 S.W.2d 974 (1932) and Eldridge v. Commonwealth, 229 Ky. 499, 17 S.W.2d 403 (1929).
An admission against interest is a statement of an accused which does not directly involve an acknowledgement of guilt or criminal intent. A confession is a voluntary statement made by a person charged with the commission of a crime, communicated to another person, wherein the facts acknowledged by him indicate criminal culpability on his part and discloses the circumstances of the act or the share and participation which he had in *282 it. Hedger v. Commonwealth, 294 Ky. 731, 172 S.W.2d 560 (1943) and Abdon v. Commonwealth, 237 Ky. 21, 34 S.W.2d 742 (1931).
The statements attributed to the appellant were not confessions. He did not confess guilt of any charge. At most the statements may be taken as an admission that a pistol in his possession fired the fatal shot.
RCr 9.60 must also be considered in connection with the requirement of proof of the corpus delicti. Corpus delicti means the body of the crime and in homicide cases proof of the corpus delicti requires a showing of (1) a death and (2) that the death resulted from the criminal agency of another. Warnell v. Commonwealth, Ky., 246 S.W.2d 144 (1952) and Hawk v. Commonwealth, 284 Ky. 217, 144 S.W.2d 496 (1940).
The corpus delicti may be shown by circumstantial evidence but the circumstances must be more consistent with guilt than with innocence. Goodman v. Commonwealth, Ky., 285 S.W.2d 146 (1955). Once the corpus delicti has been established a defendant's guilt can be established entirely by his own confession. Caldwell v. Commonwealth, Ky., 351 S.W.2d 867 (1961). Phrased in another way it may be said that the first requirement of the Commonwealth in a criminal prosecution is to establish that a crime has been committed. This cannot be established solely by an out-of-court confession. Once it has been sufficiently shown that a crime was committed the question of who committed it may be established solely upon the basis of an out-of-court confession.
In this case the appellant contends that the Commonwealth failed to establish that the death resulted from a criminal agency. He contends there is no evidence to establish that the death was the result of any act except suicide outside of the out-of-court confession of the appellant. Once again it is necessary to distinguish between a confession and a statement against interest and to point out that the statements attributed to appellant did not amount to a confession.
The evidence of appellant's discovery of the involvement of the deceased with another man, his previous physical violence toward her precipitated by that discovery and the discovery of an Easter card which might have indicated to him that the affair was not over are all circumstances which established a strong motive for the crime. That appellant had an opportunity to commit the crime was apparent.
The strong motive for the crime, and the opportunity to commit it combined with the testimony that appellant's father reported to the police that his son had shot his wife are circumstances which point strongly to a criminal agency as the cause of death and sufficiently establish the corpus delicti. Cf. Goodman v. Commonwealth, Ky., 285 S.W.2d 146 (1955); Powell v. Commonwealth, 308 Ky. 467, 214 S.W.2d 1002 (1948) and Wigginton v. Commonwealth, 92 Ky. 282, 17 S.W. 634 (1891) in which motive and opportunity were considered relevant factors in the establishment of the corpus delicti.
The cases relied upon by appellant are distinguishable upon the ground that in those cases the evidence was as consistent with the theory that no criminal agency caused the death as otherwise. In this case we think the evidence was sufficient to support the verdict.
The appellant contends that he should be granted a new trial upon the basis of newly discovered evidence. The alleged newly discovered evidence may be summarized as follows: Jack Willis McGill gave an affidavit and testified at the hearing on the motion for a new trial that he was in the Dolan household when the alleged shooting occurred. He stated that he went to the Dolan household to inquire about a used car which was advertised for sale on a poster at a nearby grocery. (Mr. Dolan, *283 Sr. stated that he had in fact posted such a notice). McGill knocked on the front door of the Dolan house, but no one answered. A young woman got out of a car parked in the driveway, came to the front door and asked if she could help him. When he informed her of his mission she told him to follow her inside. The young lady had a pistol in her hand partially concealed in some kind of wrapping material. He followed her into the house and she turned to her left telling someone not visible to him "there is a man here to see about the car." When no one came to him, he walked across the living room and looked toward the kitchen area. He could see a man, whom he identified as appellant, sitting at the end of a table talking to somebody. McGill remained unnoticed and sought to attract attention to himself by saying "excuse me." The appellant then got up from the table and came toward him. He asked about the car and appellant said "you will have to see my father" and pointed to where the father sat. Appellant then proceeded down the hallway, opened the bedroom door and discovered that his wife was shot. Appellant screamed and the other members of the family rushed to the bedroom. McGill stated that while he was in the house a noise was heard by him which could have been a gunshot but which he attributed to the backfire of some motorcycles which were in the vicinity.
McGill testified that when he found out that a woman had been shot in the bedroom and realized that he was a stranger in the house where the shooting took place, he was frightened and overcome by a powerful desire to be somewhere else. In the excitement, he left the house but remained close enough at hand to observe the arrival of the ambulance. He learned that Mrs. Dolan died and that her husband was charged with murder. He stated that he was tormented by the fact that he possessed knowledge important to the appellant but he was reluctant to involve himself in the case. He did attend the trial and intended there to make his knowledge known but when he asked someone at the court house for permission to speak with anyone connected with the Dolan case he was brushed aside. He never did tell anybody what he knew until after the trial and conviction. He then went to his employer, a Colonel Epley of the local security police, and made a disclosure of the facts. He stated that he was not acquainted with appellant or any of appellant's family and that he had not talked with any of appellant's counsel prior to his disclosure.
It is contended that this evidence does not meet the test of newly discovered evidence because appellant knew all during the trial that somebody else had been in the house on the day in question. This, of course, is true but the appellant did not know the identity of the person who had been there nor how to locate him nor did he have any way to produce McGill as a witness at the trial. Appellant and his parents testified on the hearing for a new trial that they spent many hours before trial visiting stores, taverns and public places around the neighborhood seeking to locate McGill but were unable to find him. They said they did not tell anybody the story about his presence in the house because they feared they would not be believed and the story would further discredit appellant.
We believe the evidence relied upon was discovered after the trial and it is not shown that appellant failed to exercise due diligence prior to the trial.
The Commonwealth contends that for newly discovered evidence to warrant a new trial it must be of such decisive force that it would, with reasonable certainty, have changed the verdict or would probably change the results if a new trial were granted. Citing Taylor v. Commonwealth, Ky., 444 S.W.2d 725 (1969) and Porter v. Commonwealth, Ky., 435 S.W.2d 756 (1968). We recognize the danger of fraudulent practices which is inherent in motions for new trials based upon newly discovered evidence and new trials should not be *284 granted except in those cases in which the import of the newly discovered evidence is so great as to establish the probability of a different result.
Although the evidence in this case was sufficient to uphold the verdict, it was not overwhelming. The theory of the defense was unsupported by any witness outside of the appellant and his immediate family, all of whom had a personal interest in the outcome of the trial. It was not shown that McGill had any relation to or was even acquainted with appellant or his counsel. We think the evidence of a disinterested witness, if the jury believed him to be so, would have made a vital difference in the result of this case.
We therefore direct that appellant be granted a new trial.
Since the instructions to the jury may be an issue in a new trial, we deem it appropriate to discuss appellant's contentions that the trial court erred by failure to instruct upon voluntary manslaughter, involuntary manslaughter, accidental death and suicide. Instructions on accidental death and suicide were unnecessary because the instructions given required for conviction that the jury believe beyond a reasonable doubt that appellant willfully, feloniously and with malice aforethought shot the deceased. Such a finding negates both suicide and accidental death.
The appellant did not make a specific objection either at the trial or in his motion and grounds for a new trial that instructions covering voluntary and involuntary manslaughter were not given and thus did not preserve that question for review. RCr 9.54, Greenville, Jr. v. Commonwealth, Ky., 467 S.W.2d 765 (Decided May 21, 1971) and Patrick v. Commonwealth, Ky., 436 S.W.2d 506 (1969). On another trial, however, if the same evidence is introduced relating to the involvement of the deceased with another man as a possible motive for the shooting and if appellant's admission that the pistol accidentally discharged while he was unloading it is introduced in evidence, the court should instruct on both voluntary and involuntary manslaughter. Pennington v. Commonwealth, Ky., 344 S.W.2d 407 (1961) and Marcum v. Commonwealth, 305 Ky. 92, 202 S.W.2d 1012 (1947).
The judgment is reversed.
All concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534366/ | 492 Pa. 550 (1981)
424 A.2d 1328
Timothy E. AUGUST, Appellant,
v.
George W. STASAK, Ruth Mary Stasak and John M. Stasak.
David C. BELZNER, Appellant,
v.
John M. STASAK.
Supreme Court of Pennsylvania.
Argued October 21, 1980.
Decided February 5, 1981.
*551 *552 Paul C. Hensel, Bethlehem, for Timothy E. August.
Robertson B. Taylor, Bethlehem, for David C. Belzner.
Thomas F. Traud, Jr., Allentown, for appellee.
Before O'BRIEN, C.J., and ROBERTS, NIX, LARSEN, FLAHERTY and KAUFFMAN, JJ.
OPINION
LARSEN, Justice.
This case involves an insurance policy provision which requires the insured to promptly notify the insurance company in the event of an accident or loss.[1] At one time such provisions were strictly enforced in our Commonwealth, and late notice would release the insurance company from its contractual duties, even where the late notice did not harm the insurance company in any way. See Meierdierck v. *553 Miller, 394 Pa. 484, 147 A.2d 406 (1959). However, we rejected the strict enforcement approach in Brakeman v. Potomac Insurance Co., 472 Pa. 66, 371 A.2d 193 (1977), holding that late notice would release the insurance company only where the late notice was prejudicial. Whether the new law should be applied retroactively to cases pending on appeal when this Court decided Brakeman is the issue in this case.
The accident in question occurred on November 22, 1973. John Stasak was the driver of a car which struck a telephone pole, injuring Timothy E. August and David C. Belzner (appellants) who were passengers in the car. John Stasak and his parents (appellees) did not inform their insurance company of the accident until seven months later on June 25, 1974. Appellant August had already sued the appellees; appellant Belzner sued soon thereafter. The insurance company investigated the claim but refused to defend or indemnify the appellees, asserting that the required prompt notice was not given. Appellees retained their own counsel to defend the suit of appellant August, but on May 28, 1975 August recovered a verdict of $12,150.26. Appellant Belzner obtained a default judgment on August 4, 1975, and a verdict was rendered in the amount of $4,120.00. These trials both occurred well after the insurance company had notice of the accident.
In order to satisfy their judgments, appellants instituted attachment proceedings against appellees' insurance company in 1975. At trial, the court expressly found that the insurance company was not prejudiced by the late notice because the company had access to all the witnesses, the police accident report, and appellee's personal defense counsel's files. Furthermore, adequate time to prepare for trial remained even after late notice. However, the court denied relief, holding that the insurance company's refusal was proper under the prior law. August v. Stasak, No. 387 January Term 1974, No. 356 January Term 1975 (Court of Common Pleas of Northampton County, filed February 1, 1977). In 1977, while an appeal to the Superior Court was *554 pending in this case, this Court decided Brakeman, supra, and changed the law. The Superior Court, however, refused to apply our holding in Brakeman retroactively to this case and denied relief. August v. Stasak, 253 Pa.Super. 311, 384 A.2d 1359 (1978). Judges Hoffman and Spaeth dissented and would have extended the new law to cases pending on appeal. We granted allocatur to consider this question.
This Court's Brakeman decision is silent as to whether the holding applies to cases pending on appeal, although the new law was applied retroactively to the parties to that litigation. Also, recourse to precedent is inconclusive because there is no fixed rule as to what effect an overruling decision should have. At common law, an overruling decision is normally retroactive. See Buradus v. General Cement Products Co., 356 Pa. 349, 52 A.2d 205 (1947); Harry C. Erb, Inc. v. Shell Construction Co., 206 Pa.Super. 388, 213 A.2d 383 (1965), allocatur denied. However, a sweeping rule of retroactive application cannot be justified. Box Office Pictures, Inc. v. Board of Finance and Review, 402 Pa. 511, 166 A.2d 656 (1961). Retroactive application is a matter of judicial discretion which must be exercised on a case by case basis. Linkletter v. Walker, 381 U.S. 618, 85 S. Ct. 1731, 14 L. Ed. 2d 601 (1965).
Justice Roger Traynor of the California Supreme Court has proposed an elegant test for deciding whether an overruling decision will have retroactive effect balancing the hardships imposed upon parties:
A judge is mindful of the traditional antipathy toward retroactive law that springs from its recurring association with injustice and reckons with the possibility that a retroactive overruling could entail substantial hardship. He may nevertheless be impelled to make such an overruling if the hardships it would impose upon those who have relied upon the precedent appear not so great as the hardships that would inure to those who would remain saddled with a bad precedent under a prospective overruling only . . . [T]he outworn precedent may be so badly *555 worn that whatever reliance it engendered would hardly be worthy of protection.
Traynor, R., La Rude Vita, La Dolce Giustizia; Or Hard Cases Can Make Good Law, 29 U.Chi.L.Rev. 223, 231-32 (1962).
Balancing the hardships in this case clearly mandates that the appellants prevail. The equities in this case are exactly the same as the equities in the Brakeman case which characterized the prior law as permitting a forfeiture and being inequitable:
Allowing an insurance company, which has collected full premiums for coverage, to refuse compensation to an accident victim or insured on the ground of late notice, where it is not shown timely notice would have put the company in a more favorable position, is unduly severe and inequitable.
Brakeman, supra 472 Pa. at 73, 371 A.2d at 196.
This Court will not protect the expectations of the company by enforcing an unfair forfeiture provision in an insurance policy. Forfeitures of insurance policies are not favored either at law or in equity. Poles v. State Mutual Benefit Society, 129 Pa.Super. 297, 195 A. 429 (1937). Forfeiture in this case would impose a severe hardship on appellants, the accident victims, whose outstanding judgments may well remain unsatisfied if forfeiture is permitted.
The Brakeman decision also sought to effectuate the reasonable expectations of the insured that coverage would not be forfeited by nonprejudicial late notice: "[W]e do not think such a result [forfeiture] comports with the reasonable expectations of those who purchase insurance policies." Id. 472 Pa. at 76, 217 A.2d at 198. See generally Collister v. Nationwide Life Insurance Co., 479 Pa. 579, 594, 388 A.2d 1346, 1353 (1978) ("The reasonable expectation of the insured is the focal point of the insurance transaction involved here. . . . Courts should be concerned with assuring that the insurance purchasing public's reasonable expectations are fulfilled.") The insured, appellees in this case, had a *556 reasonable expectation that the coverage would not be forfeited by nonprejudicial late notice.
We must balance the above hardships to the appellants against the hardships to the insurer from a retroactive application of Brakeman. The insurance company is being called upon to perform its duty of indemnification, for which it has received full premiums this can hardly be counted as a hardship. Moreover, the insurance company has not presented any evidence that remotely suggests it could have obtained a more favorable result if it had defended. Prejudice in the abstract is not prejudice. Finally, the insurance company's decision not to defend was made even though it had adequate notice and opportunity to prepare for trial. Thus, any hardship here in failing to defend was of the insurer's own doing. The insurance company has not demonstrated hardships greater than those of the appellants, if at all.
Therefore, applying the approach advanced by Justice Traynor, appellants must prevail. In fact, this case is factually similar to the Brakeman case and may well have been the case which overruled prior law if Brakeman had not been decided while this case was pending on appeal. Since no distinction can be drawn between appellants and the injured party in Brakeman, the same relief should be available. See: Gibson v. Commonwealth, 490 Pa. 156, 165, 415 A.2d 80, 85 (1980) where in an analogous situation Mr. Justice Roberts stated for this court: "There is no principled reason to discriminate now against appellants whose causes also accrued before [the overruling decision] . . . both classes of suits affect the Commonwealth in equal measure, and therefore must be treated in like fashion."
Applying Brakeman retroactively is in perfect accord with numerous recent decisions in this state. See: Kuchinic v. McCrory, 422 Pa. 620, 222 A.2d 897 (1966) (change of conflicts of law rule applied to case pending on appeal); Snyder v. Shamokon Area School District, 226 Pa.Super. 369, 311 A.2d 658, 659 (1973) (Abrogation of governmental immunity *557 of school district applied to cases pending on appeal; Superior Court relied on actions of this court in making this determination); Wheeling-Pittsburgh Steel Corp. v. Board of Revision of Taxes, etc., 40 Pa.Cmwlth. 306, 397 A.2d 1253 (1979) (ruling that certain property not subject to taxation applied retroactively); Gibson v. Commonwealth, supra (judicial abrogation of sovereign immunity applied retroactively).
It is unnecessary to remand because the trial court found that the insurance company was not prejudiced by the late notice. The order of the Superior Court is reversed.
ROBERTS, J., filed a concurring opinion in which O'BRIEN, C.J., and FLAHERTY, J., joined.
FLAHERTY, J., joins the majority opinion and ROBERTS, J., concurring opinion.
NIX, J. concurred in the result.
ROBERTS, Justice, concurring.
I agree with Mr. Justice Larsen that appellants are entitled to the benefit of this Court's decision in Brakeman v. Potomac Insurance Co., 472 Pa. 66, 371 A.2d 193 (1977). These cases were pending on direct appeal at the time Brakeman was decided. Manifestly, "it is unfair to litigants whose case is not yet final to subject them to a law that is now recognized as offensive. Even-handed decision-making requires that similarly situated individuals on direct appeal be treated the same." Commonwealth v. Hill, 492 Pa. 108, 111, 422 A.2d 491, 499 (1980) (Roberts, J., Opinion in Support of Reversal, joined by O'Brien, C.J., and Flaherty, J.). The orders of the Superior Court, therefore, must be reversed.
O'BRIEN, C.J., and FLAHERTY, J., join this concurring opinion.
NOTES
[1] The insurance policy in this case provides:
NOTICE
In the event of an accident, occurrence or loss, written notice containing particulars sufficient to identify the Insured and also reasonably obtainable information with respect to the time, place and circumstances thereof, and the names and addresses of the injured and of available witnesses, shall be given by or for the Insured to the Company or any of its authorized agents as soon as practicable . . . If claim is made or suit is brought against the Insured, he shall immediately forward to the Company every demand, notice, summons or other process received by him or his representative . . .
ACTION AGAINST THE COMPANY . . .
No action shall lie against the Company unless, as a condition precedent thereto, the Insured shall have fully complied with all the terms of this policy . . . | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534365/ | 468 S.W.2d 540 (1971)
HOUSTON ENDOWMENT, INC., Appellant,
v.
CITY OF HOUSTON, Texas et al., Appellees.
No. 438.
Court of Civil Appeals of Texas, Houston (14th Dist.).
May 12, 1971.
Rehearing Denied June 1, 1971.
John C. Nabors, Liddell, Sapp, Zivley & Brown, Houston, for appellant.
W. Lawrence Cook Jr., Sr. Asst. City Atty., Houston, for appellees.
SAM D. JOHNSON, Justice.
On November 29, 1967, Houston Endowment, Inc., brought suit against the City of Houston seeking temporary and permanent *541 injunctive relief against the City's plan to annex and tax a 220-acre tract of unimproved land owned by Houston Endowment. On December 6, 1967, the District Court of Harris County, Texas, temporarily enjoined the City from passing on final reading the ordinance which would annex the Houston Endowment tract of land. The First Court of Civil Appeals reversed the trial court's decision and dissolved the temporary injunction against annexation. City of Houston v. Houston Endowment, Inc., 428 S.W.2d 706 (1968), err. ref., n.r. e. After the Supreme Court found "no reversible error" in that action the City of Houston completed the procedural steps necessary to annex the Houston Endowment tract. The City of Houston then sought to impose taxes for the year 1970 at the full rate for property within the general city limits. Houston Endowment thereafter challenged the legality of the City of Houston's plan to tax the land owned by the appellant. In May 1970, the instant case was tried to a jury which answered the three submitted special issues in favor of Houston Endowment. The trial court granted the City of Houston's motion for judgment non obstante veredicto, however, and entered judgment that Houston Endowment take nothing. Houston Endowment has duly perfected appeal to this Court.
Houston Endowment owns approximately 770 acres of land in the Thomas Earle Survey in Harris County which is bounded on the north by the Houston Ship Channel. The approximately 200 acres in question here is a part of Houston Endowment's larger tract and is that part which is immediately adjacent to the Houston Ship Channel. The property is vacant, unimproved and devoted exclusively to agricultural purposes. Its greatest potential, however, is for industrial development.
Houston Endowment's 220-acre tract lies within a 5,000 foot wide strip of land that extended 20 air miles down the Houston Ship Channel which was specially annexed by Houston in 1913, pursuant to Articles 1183-1187, Vernon's Ann.Civ.St. This long strip of land (sometimes herein referred to as "specially annexed extension") lies on both sides of the ship channel. Pursuant to the cited statute it was annexed for the limited purpose of navigation and wharfage, but was not within the general city limits. Subsequent to the 1913 special annexation the City of Houston held exclusive jurisdiction of the specially annexed extension and no other city could annex or otherwise deal with any part of the area. City of Balena Park v. City of Houston, Tex.Civ.App., 133 S.W.2d 162, writ ref.; Tod v. City of Houston 276 S.W. 419 (Tex.Com.App.1925).
On August 28, 1967, Article 1187-1, V. A.C.S., became effective. It provides:
"The governing body of any incorporated city which has heretofore annexed or which shall hereafter annex territory under authority of and for the limited purposes described in Articles 1183 through 1187 of the Revised Civil Statutes of Texas, 1925, shall have the right, power, and authority to designate all or any part of such area so annexed and remaining in such limited purpose annexation status as an industrial district, as the term is customarily used, and to treat with such area from time to time as such governing body may deem to be in the best interest of the city. Included in such rights and powers of the governing body of any such city is the permissive right and power to enter into contracts or agreements with the owner or owners of land in such industrial district to guarantee the continuation of the limited purpose annexation status of such district, and its immunity from general purpose annexation by the city for a period of time not to exceed ten years, and upon such other terms and conditions as the parties might deem appropriate. Such contract or agreement shall be evidenced in writing and may be renewed or extended for successive periods not to exceed ten years each by such governing body and the owner or owners of land in such industrial district."
*542 In the month immediately following the effective date of the above statute, that is, in September 1967, the Houston City Council declared its intention with respect to the property within the specially annexed extension by setting forth the City's intent to enter into industrial district contracts with property owners who made application prior to October 31, 1967. The City of Houston further declared its intent to generally annex the property of owners who did not apply for industrial district contracts. Guidelines were established for the industrial district contracts which provided that (1) as to land, an owner should annually pay the City a sum equal to that which would be paid in city ad valorem taxes if the city were within the general city limits, and (2) on property other than land, the owner should annually pay at a rate which would begin at a reduced or fractional percentage of the ad valorem tax which would be due if the property were within the general city limits and then increase on a graduated basis for the next five years until it equaled the tax rate on property within the general city limits. The rate would remain at that equal to the tax rate on property within the general city limits for the remainder of the 10-year industrial district contract. The City of Houston agreed that it would not generally annex property covered by industrial district contracts for ten years.
Houston Endowment did not apply for an industrial district contract. Thereafter, on November 8, 1967, Houston's City Council passed on first reading Ordinance 67-2146 purporting to generally annex Houston Endowment's 220-acre tract lying within the specially annexed extension together with a 150-foot wide connecting strip (also lying within the specially annexed extension) to Houston's existing general city limits. Houston Endowment then brought this suit seeking temporary and permanent injunctive relief against the City's plan to annex and tax its property. The District Court of Harris County enjoined the annexation and the First Court of Civil Appeals reversed and dissolved the temporary injunction. City of Houston v. Houston Endowment, Inc., 428 S.W.2d 706, err. ref., n.r.e. Thereafter, on April 2, 1969, Ordinance No. 67-2146 was passed on second and final reading and the procedural steps necessary for annexation of Houston Endowment's tract were completed. It is clear that since the date last referred to Houston Endowment's 220-acre tract has been within the general city limits of the City of Houston. Being within the general city limits the City of Houston sought to impose full city taxes on Houston Endowment's 220-acre tract for the year 1970 and the instant controversy issued.
At the instant trial the jury responded to three special issues. The jury found (1) that the market value of the Houston Endowment tract would be substantially impaired as a result of the annexation and taxation while charging only the rates specified to signers of industrial district contracts, (2) that the City of Houston's primary purpose in entering into industrial district contracts was to raise revenue and not for the purpose of regulation, and (3) that Houston Endowment's land would not receive any benefit from annexation. Houston Endowment's motion for judgment on the verdict was denied and the City of Houston's motion for judgment non obstante veredicto was granted.
Appellant Houston Endowment brings five points of error. The thrust of appellant's contention is that the City of Houston's industrial district rates or charges (for those with whom it has industrial district contracts) are actually taxes. Further, that being taxes they are discriminatory in that they favor (a) improved property over unimproved property (which is covered by an industrial district contract, therefore within the industrial district yet outside the general city limits), and (b) industrial district property covered by an industrial district contract (therefore being outside the general city limits) over property within the general city limits. Appellant *543 reasons that being discriminatory taxes they not only impair the value of its property but also violate Art. VIII, Sec. 1, of the Texas Constitution, V.A.T.S., which provides that taxation shall be equal and uniform.
We are of the opinion that Houston Endowment's allegations concerning the harmful and discriminatory aspects of taxation and the violation of constitutional provisions are substantially the same as its allegations upon the former appeal from the trial court's order granting the temporary injunction. In considering such former appeal, City of Houston et al. v. Houston Endowment, Inc., supra, at p. 709, the First Court of Civil Appeals stated:
"Appellee says the City's industrial district program is a violation of both Article VIII, Section 1, of the Texas Constitution, Vernon's Ann.St. (which provides that taxation shall be equal and uniform), and the equal protection provisions of the Fourteenth Amendment to the United States Constitution. Appellee's property is unimproved, so it would be taxed at the full rate whether appellee signs an industrial district contract or not. A different rate is provided for improvements on the land of those who sign a contract.
"Appellee says that since 90% of the surrounding tracts have on them other property worth over one million dollars, the result is that the surrounding properties are taxed at a lower rate than appellee's.
"We overrule this counterpoint. If the annexation is completed, appellee's land will be taxed on the same basis as other land within the general city limits, and property outside such limits will be taxed at a different rate. Such is the usual case.
"Appellee asserts that it will receive no benefit from annexation, that the market value of its land would suffer and that the result is a taking of the property without due process. We cannot sustain this theory. (Citing cases.,)
"There being no disputed issue of fact, the questions for determination on this appeal are matters of law."
The questions now presented and most strenuously urged by Houston Endowment were advanced and fully considered in the former appeal by the First Court of Civil Appeals. That Court held that the City of Houston's industrial district program was not unconstitutional. A ruling by an appellate court on a question of law raised on appeal will generally be regarded as the law of the case in all subsequent proceedings in the same case, including a retrial and a subsequent appeal. Elliott v. Moffett, Tex.Civ.App., 165 S.W.2d 911, ref., w. o.m.; Allied Finance Company v. Shaw, Tex.Civ.App., 373 S.W.2d 100, ref., n.r.e. Although a determination of whether a prior decision in the same case will be reopened upon a second appeal is a matter within the discretion of the appellate court, Roberts v. Armstrong, 231 S.W. 371 (Tex. Com.App., op. adopted, 1921) this Court is not persuaded that this is a proper instance for its exercise.
Though the foregoing is considered dispositive the following has relevancy in this particular instance.
As will be recalled, Houston Endowment's property was unimproved land. Therefore, if it had signed an industrial district contract its charges would have been set at "A sum equal to the city ad valorem tax which would be due if the land were within Houston's general limits." It did not sign an industrial district contract and underwent annexation of its property into the general city limits. This alternative resulted in taxation identical to that applicable to all other property within the general city limits. Either alternative available to Houston Endowment would result in an annual payment to the City of the same identical sum of money whether it be denominated a charge or a tax. Either payment, whether denominated as a *544 charge or a tax, contends Houston Endowment, would be discriminatory. Aside from appellant's contentions, we believe it is apparent that Houston Endowment's tract, being inside the general city limits, is being taxed on the same basis as all other property within the general city limits. This has been stipulated. Even so, argues Houston Endowment, its annual tax payments, at least for the first five years, will be in excess of those charges applicable to improved property on which industrial contract have been made (which therefore is outside the general city limits.).
Article 1187-1, V.A.T.S., provides that all or any part of that property specially annexed under Articles 1183 through 1187, V.A.T.S., may be designated as an industrial district. It further provides the specific permissive power of the City to enter into written contracts with owners of property therein "* * * to guarantee the continuation of the limited purpose annexation status of such district, and its immunity from general purpose annexation * * * upon such other terms and conditions as the parties might deem appropriate." Art. 1187-1, V.A.T.S., is almost identical to Art. 970a, Sec. 5, V.A.T.S., except that the latter refers to industrial districts created on property within the extraterritorial jurisdiction of a city and provides for contracts of seven years duration. In a similar attack involving Art. 970a, Sec. 5, V.A.T.S., this Court stated:
"It is therefore clear that the action taken by the city (of Pasadena) is in contemplation of and is authorized by Art. 970a, Sec. 5, and we find no constitutional objection thereto. It is assumed that appellee's land will be taxed at a lawful rate when it is taken into the city. The property of (other owners), not being annexed, will lie outside the limits of the city and within the extraterritorial jurisdiction. In view of the power of the city to annex such contiguous territory as it sees fit, we see no constitutional objection to the city's dealing with property outside its boundaries at a different tax rate. A statute or rule under constitutional attack is to be construed as valid if reasonably possible. Duncan v. Gabler, 147 Tex. 229, 215 S.W.2d 155. If there is a substantial basis for classification and if the classification is not unreasonable, arbitrary or capricious, the legislature or a Home Rule city acts within the legitimate scope of its authority and power. Mumme v. Marrs, 120 Tex. 383, 40 S.W.2d 31, 36; Wood v. Wood, 159 Tex. 350, 320 S.W.2d 807. We believe a reasonable basis for classification under the above facts is afforded."
City of Pasadena v. Houston Endowment, Inc., Tex.Civ.App., 438 S.W.2d 152, 157, writ ref., n.r.e. For the reasons implied in the foregoing case, we hold that the action taken by the City in the instant case was in contemplation of and authorized by Art. 1187-1, to which we find no valid constitutional objection.
Appellant's points of error are overruled. The judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534369/ | 468 S.W.2d 592 (1971)
Walter WOODRUM, Appellant,
v.
Ray COWAN and Jake Jacobsen, Appellees.
No. 11817.
Court of Civil Appeals of Texas, Austin.
May 26, 1971.
Rehearing Denied June 23, 1971.
*593 Schulz, Hanna & Burke, W. L. Burke, Jr., McMahon, Smart, Sprain, Wilson & Camp, J. M. Lee, Abilene, for appellant.
Mitchell, Gilbert & McLean, Wallace A. McLean, Austin, for appellees.
O'QUINN, Justice.
Walter Woodrum, now the appellant, brought this suit against Ray Cowan and Jake Jacobsen for recovery of damages for breach of a written contract.
Cowan and Jacobsen filed a motion for summary judgment, and upon final hearing the trial court granted the motion and entered judgment that Woodrum take nothing.
We reverse the judgment of the trial court and remand the cause for trial on the question of damages.
The record before the trial court and before this Court includes the pleadings of the parties, eight oral depositions, three written interrogatories, affidavits and opposing affidavits, and briefs and arguments of counsel.
Prior to and for some four months after October of 1964 Walter Woodrum was president of the Bank of Commerce of Abilene, Texas, and owned about 73,682 shares of the common stock of the bank. In October of 1964 Ray Cowan and Jake Jacobsen acquired 68,926 shares of the bank's common stock, and on the date of this acquisition Woodrum, Cowan, and Jacobsen entered into a written contract under the terms of which they pooled all of their common stock, amounting to 142,608 shares. The parties to the contract agreed not to sell any of this block of stock to any other person without agreement of all parties to the contract. The parties also agreed to vote the entire block as a unit as long as any part of the shares were the subject of a pledge agreement with the Fort Worth National Bank of Fort Worth, Texas, where the parties had borrowed $426,897.35 in acquiring the common stock.
After this agreement, Woodrum continued as president, Ray Cowan became chairman of the board of directors, and all three of the men served as directors of the Abilene bank. About four months later some discord developed between Woodrum and the other two men. Cowan as chairman of the board refused authorization for Woodrum to receive a salary as president, and during the months of March and April of 1965 Woodrum was not paid. Woodrum was asked to move his offices from the bank itself into disconnected offices in the bank building. Woodrum testified by deposition that in other ways Cowan and Jacobsen interfered with his administration and that the course of conduct pursued by Cowan and Jacobsen was intended by them to put economic duress on Woodrum and compel him to sell his stock to Cowan and Jacobsen. The record shows that Woodrum *594 did sell his stock to Cowan and Jacobsen under terms of a written contract entered into by the three men on May 12, 1965.
The basis of this lawsuit, which Woodrum subsequently brought against Cowan and Jacobsen, is the contract the parties made on May 12, 1965, which Woodrum alleged appellees breached by selling a controlling interest in the bank without sharing with him one-third of the profit as provided in the contract.
The provision of the contract upon which Woodrum relied in bringing suit reads:
"It is agreed by and between the parties that in the event that Ray Cowan and Jake Jacobsen should sell controlling interest in the bank, or a sufficient amount of stock to amount to 51% of the bank's authorized capital stock to any one person, firm or corporation at any time within the next 2 years at and for a profit, that the said Ray Cowan and Jake Jacobsen will pay to Walter Woodrum his 1/3 share of the profit."
The contract also provided that "this contract is made in consummation of, implementation to and in accordance with the agreement of October, 1964 between the parties * * *" under which each of the three men held one-third of the block of 142,608, of which Woodrum initially owned 73,682 shares.
Cowan and Jacobsen sold the entire stock holdings to a group of five men on September 3, 1965, or within less than five months after the agreement of May 12. Under the contract, as noted, Cowan and Jacobsen agreed that if they sold a controlling interest in the bank "to any one person, firm or corporation at any time within the next two years" for a profit, they would "pay to Walter Woodrum his 1/3 share of the profit."
The principal question is whether sale of the stock, which the record shows was a controlling interest in the bank, to the group who purchased the stock constituted a sale to "one person, firm, or corporation" within the meaning and intent of the contract of May 12. Stated more precisely, the question is whether the five principals who acquired control of the bank from Cowan and Jacobsen were so constituted legaly as to be considered a firm within the meaning and intent of the contract.
The five men who bought the stock together were business and professional men in Abilene. Two of the men, Hal McGlothlin and Jack McGlothlin, were brothers engaged in various common interests, and were the purchasers who later furnished for the group $50,000 in earnest money in connection with the purchase. David Fry was a close friend of the McGlothlins and is shown to have had considerable banking experience. By prior agreement among the purchasers, Fry later became president of the bank. Joe Corbin, who by prior agreement later became chairman of the board of directors of the bank, was a brother-in-law of the McGlothlins. The fifth member of the group was Randall Jackson, an attorney having experience in banking who was also general counsel for another bank in Abilene. Jackson later became trustee for the group in handling money borrowed by the purchasers from the Fort Worth National Bank and in making distribution from the trust account of the funds due various persons, including Cowan and Jacobsen as the sellers of the stock.
Initial negotiations in behalf of the group was handled by Randall Jackson at the request of the purchasers. In the course of the negotiations Cowan represented that he would be able to deliver to the group controlling interest in the bank. Joe Corbin testified in answer to written interrogatories that "* * * the understanding and agreement between the five people was that the controlling interest in the bank would be acquired and that it would remain as a single block so that control *595 of the bank would remain in one single block."
It is undisputed that the purchasers felt that control of the bank was needed to insure continuity and centralized management, affording the right to dictate policies of the bank without interference from splinter groups. They were in agreement, and Cowan concurred, that holding controlling interest was of grave importance in administration, as well as in economics, and that a control block of stock was worth more money on a per share basis. Corbin testified that the five purchasers agreed that losses previously suffered by the bank and the consequent tax losses that could be carried forward would be used as offsets against income which three of the purchasers anticipated in the future. As it later turned out the extent of the losses were greater than the purchasers expected, although they recognized in advance that some losses would be experienced.
Following the initial negotiations between Cowan and Jackson, a meeting in Baird, Texas, was attended on August 28, 1965, by Hal McGlothlin, Corbin, Fry, and Jackson, representing the purchasers, and by Cowan, Jacobsen, and J. W. Munson, who acted as trustee for Jacobsen in making a contract to sell. Jackson took the lead in negotiations in behalf of the purchasers, which resulted in a contract by which Cowan and Jacobsen agreed to sell 163,000 shares of stock in the Bank of Commerce for $6.90 per share. Earnest money in the amount of $50,000 was deposited in the Austin National Bank in Austin, Texas. Although Jack McGlothlin was not at the meeting, he testified that he had discussed the proposed purchase in advance with the other men in the group and the agreement made by them was with his sanction.
The contract provided that Cowan and Jacobsen could vary the number of shares subject to transfer, but the figure could not be reduced below fifty-one percent of the outstanding stock of the bank.
These negotiations culminated on September 3, 1965, in Fort Worth at the Fort Worth National Bank, with transfer of the Cowan and Jacobsen block of shares, in the amount of 162,191 shares. The stock was deposited in the Fort Worth bank, with all certificates executed in blank. The five purchasers executed a joint and several note in excess of $1,000,000 to the bank for the funds with which Jackson, as trustee for the group, paid Cowan and Jacobsen. At the time of these transactions the purchasers had not decided among themselves how the stock would be apportioned, a matter to be determined by them later.
The joint and several note executed by the five purchasers was the subject of a pledge with the Fort Worth bank under the terms of which control of the Abilene bank was to be maintained by the group as long as the note was outstanding and unpaid. The note was further secured by a pledge of stocks separately owned by the two McGlothlins and by Corbin.
In connection with the sale of the stock to the group, Cowan and others transferred by deed the real estate upon which the Abilene bank was located to Jackson as trustee. Jackson testified, "The property deeded to me as trustee was donated as contributed capital to the Bank of Commerce. It was originally deeded directly to the bank; when the bank management and the State Banking Department did not agree on the method of carrying it on the books, then a loan was secured from the First Savings and Loan Association of San Angelo, and the monies received were donated to the bank as contributed capital."
At the time of the sale of stock in September, 1965, the total of outstanding shares of common stock in the Bank of Commerce was 230,000. The sale of 162,191 shares was in excess of the fifty-one percent required by the group who purchased from Cowan and Jacobsen. Appellees Cowan and Jacobsen argue that they *596 did not sell a controlling interest in the bank, but that as to 47,536 shares they acted as a sort of conduit for shares held by Sydney Niblo of Abilene. The basis for this contention is found in a buy-and-sell contract Cowan and Jacobsen made with Niblo about June, 1965.
After Cowan and Jacobsen acquired Woodrum's stock through the contract of May 12, 1965, in which they agreed to pay Woodrum "his one-third share of the profit" if control of the bank should be sold within two years, appellees in June selected Sydney Niblo to function as president and made a stock pool contract with him. This contract was similar to the pooling contract Cowan and Jacobsen first made with Woodrum around October, 1964. Under the terms of the agreement with Niblo an aggregate of 142,791 shares went into the pool. In the pooling contract with Woodrum the total was 142,608 shares. The shares attributable to Niblo under the pooling contract was 47,536 shares.
After the contract of August 28 with the group of purchasers and before the closing on September 3 with the group in Fort Worth, Cowan called on Niblo to buy or sell under terms of the pooling agreement. Cowan told Niblo that Cowan and Jacobsen "had a sale, and that they thought it was attractive and they wanted to do it." Niblo testified that he "was bound by the agreement" to sell "if they wanted me to," and he was not financially "in a position to buy their stock." Niblo stated, "* * * as I remember, I certainly expressed myself that I was disappointed that that was they way things were working and I certainly had no intention of getting into a situation like that just for a short interim period or as a speculative sort of thing. I regarded it as a more permanent situation."
Cowan and Jacobsen caused a complete stock power to be prepared, and Niblo executed the instrument before a notary public in Taylor County. The stock power, dated September 1, 1965, and directed to the Fort Worth National Bank, recited in pertinent part:
"This is to advise you that I have this date sold to Mr. Ray Cowan individually and to Mr. Ray Cowan and Mr. J. W. Munson, Trustees for Jake Jacobsen, all of the stock owned by me in the Bank of Commerce of Abilene, Taylor County, Texas, and which is in your possession. And you are hereby authorized to transfer said stock certificates in your possession to my grantees signing my name on said transfers.
* * * * * *
"For the foregoing purposes, I here and now designate Fort Worth National Bank as my attorney-in-fact to transfer said stock certificates."
Cowan gave Niblo his personal check for the stock. When asked if he converted Cowan's check "to a cashier's check that same day," Niblo replied, "Immediately."
The transaction by which Cowan and Jacobsen acquired 47,536 shares from Niblo, bringing the stock pool subject to transfer to the group of purchasers to the sum of 162,191, was completed two days before the closing which took place at the Fort Worth National Bank on September 3. The stock transferred to the Abilene group was in excess of fifty-one percent of the outstanding shares of 230,000 and constituted sale of controlling interest in the Bank of Commerce.
Subsequent to acquiring control of the bank, the five purchasers found that the bank was in greater need of capital than they initially believed it required. When the State Banking Commissioner would not approve a capital contribution in the form of the real estate acquired from Cowan and Jacobsen, the five principals took title to the property in their individual names and secured a loan of $200,000 from the San Angelo Savings and Loan Association. The loan was evidenced by a promissory note upon which all five principals were jointly and severally liable. They then made a capital contribution of $200,000 to the Bank of Commerce.
*597 At the time of hearing all of the principals, except Jackson who had settled with the other four men to relieve himself of further obligation on the San Angelo loan, were obligated on the note for $200,000. The record shows that all five principals involved in purchase of the controlling interest in the bank contributed jointly to the purchase of the stock by joint and several assumption of a loan at the Fort Worth National Bank in the sum of $1,301,450.40, and thereafter jointly contributed $200,000 in cash to the bank while all of them served on the bank's board of directors.
It does not appear to be disputed that the five principals obligated themselves to retain control of the bank, had specific understandings that no one of them would do anything to dilute their control, and would do nothing to prejudice the integrity of their joint agreement. Also, as noted, their contract with the Fort Worth National Bank obligated them to keep control of the bank within the group of five principals as long as the note to the Fort Worth bank was outstanding and not paid.
We find it conclusive in the record that the five principals would not have undertaken purchase of the block of stock from Cowan and Jacobsen if the purchase had not resulted in control of the bank being placed in the group and if the purchase and subsequent management of the bank had not been undertaken by them as a team working together. Corbin testified, "As an individual, I could not have bought the bank. As an individual, anyone of the five men who were involved in it could not, or would not have bought the bank. We were five joined together to make an acquisition."
After the five principals acquired the bank, for the years 1966 and 1967, joint partnership tax returns were filed reflecting equal interest of the five men in the bank real estate and buildings. During this period the property was still held for the group by Jackson as trustee. In accordance with their prior agreement, the five principals served in executive capacities in the bank and as a group maintained joint control of the bank and its affairs.
It is settled that in construction of contracts the court will ascertain the real intention of the parties from the language found by examination of the entire agreement and will view the agreement as of the time it was made and not in the light of subsequent events. Ervay, Inc. v. Wood, 373 S.W.2d 380 (Tex.Civ.App. Dallas 1963, writ ref. n.r.e.); Burrus Mills, Inc. v. Hein, 378 S.W.2d 85 (Tex.Civ.App. Dallas 1964, writ dsmd.); Dedier v. Grossman, 454 S.W.2d 231 (Tex.Civ.App. Dallas 1970, writ ref. n.r.e.).
We think it clear that the main purpose of the parties in making the contract in October, 1964, under which they pooled their bank stock and agreed in effect not to sell it except in a block, was to concentrate control of the bank in one groupWoodrum, Cowan, and Jacobsen. If they all agree to sell their controlling interest in the bank, the price per share would be enhanced thereby, as opposed to piecemeal sales made to persons not seeking control. Under this arrangement, Woodrum contributed 73,682 shares and Cowan and Jacobsen had 68,926, to bring the pool to 142,608 shares, more than enough to effect control of the bank.
The later contract of May 12, 1965, upon which Woodrum brought this suit, as noted earlier, was "* * * made in consummation of, implementation to and in accordance with the agreement of October 1964 between the parties." By the last contract, a majority of the bank stock, constituting control, remained concentrated, this time in Cowan and Jacobsen, with Woodrum to have "his 1/3 share of the profit" if sold as a controlling interest within the next two years. We believe that a fair and reasonable reading of the contract is that part of the consideration for its making was that Woodrum in surrendering title to his stock retained an interest in any profit that *598 might be realized within two years from sale of "controlling interest * * * or sufficient * * * stock to amount to 51% of * * * authorized capital * * to any one person, firm or corporation * * *"
In using the term "to any one person, firm or corporation" the parties did not further the general intent of their contract to sell control of the bank, calculated to bring a better price per share than if sold piecemeal. The term could serve no purpose but to indicate that the parties would not sell the stock in separate lots under circumstances in which the purchasers were without motivation or desire to acquire controlling interest in the bank.
The appellees are at great pains to show that the term "firm" as used in the contract is not applicable to the five principals who bought the bank stock in one block and acquired, by their own expressed intent, a controlling interest in the bank. Appellees insist that the purchasers do not come within the meaning of the term because the group did not have the characteristics of a partnership. The cases relied upon and the argument of appellees in this connection deal with the elemental essentials of a general partnership.
If the combination achieved by the five principals in negotiating and acquiring control of the Abilene bank amounts to a joint venture, their mutual agreements to borrow money, buy the stock, and continue to retain controlling interest within their number were obligations binding upon the individual members of the venture. Under the facts which we have already stated, we conclude that this combination was a joint venture as a matter of law.
The Supreme Court has described a joint adventure as a limited or special partnership engaged in the joint prosecution of a particular transaction for mutual benefit or profit. Holcombe v. Lorino, 124 tex. 446, 79 S.W.2d 307 (1935); Puryear Porter v. Puryear, 153 Tex. 82, 262 S.W.2d 933, 264 S.W.2d 689 (1953). "To constitute a joint adventure," the Supreme Court said in 1956, "there must be a community of interest and participation in the profits. It is in the nature of a partnership engaged in the joint prosecution of a particular transaction for mutual profit." Brown v. Cole, 155 Tex. 624, 291 S.W.2d 704 (1956). The Court there further stated, "The relationship being in the nature of a partnership, losses must be shared as well as profits." (291 S.W.2d 709, col. 2)
The five principals who bought control of the Abilene bank, with money they borrowed on a joint and several obligation, as between themselves bore the relation of joint adventures under holdings of authorities found in 48 C.J.S. Joint Adventures § 2, pp. 813-814. There it is said that particular transactions constituting joint adventures include agreements "* * * that one or more shall contribute money and the other or others special knowledge, experience, or judgment, as in the purchase and development of lands; * * * the buying and selling of corporate stock * * and other transactions," including purchase and management of vessels, nurseries, gas companies, theaters, ice plants, and radio stations. To these enumerations it is equally logical to add the purchase, control, management, and operation of a bank as a transaction constituting a joint adventure.
Although the courts of this State do not treat a joint venture as identical with a partnership, "* * * yet it is universally held that such relation is so similar in its nature to a partnership and in the contractual relation created thereby that the rights as to the members are governed by substantially the same rules that govern partnerships." Thompson v. Duncan, 44 S.W.2d 904 (Tex.Com.App.1932) The joint adventure has been recognized as "* * * a species of partnership, and a concept of comparatively modern origin. Generally it is a partnership of a limited nature by two or more persons to jointly prosecute a particular transaction for mutual *599 benefit or profit. * * * The joint adventurer relation is subject to dissolution and termination upon the same basis as a conventional partnership." Booth v. Wilson, 339 S.W.2d 388 (Tex.Civ.App. Texarkana 1960, writ ref. n.r.e.). A joint adventure has been described as a partnership for a single transaction or venture. Harris v. Cleveland, 294 S.W.2d 235 (Tex.Civ.App. Galveston 1956, writ dsmd.). There is no distinction to be drawn between the duties owing by partners and those owing by joint adventurers. Johnson v. Peckham, 132 Tex. 148, 120 S.W.2d 786 (1938).
The rule followed in Texas and in most other jurisdictions is stated in American Jurisprudence:
"The relations of the parties to a joint venture and the nature of their association are so similar and closely kin to a partnership that it is ordinarily held that their rights, duties and liabilities are to be tested by rules which are closely analogous to and substantially the same, if not exactly the same, as those which govern partnerships." 46 Am.Jur.2d, Joint Ventures, sec. 4, pp. 24-25.
Appellees in negotiating and making a sale of the block of stock which gave the buyers control of the bank dealt with the purchasers as a group and had no transactions with them as separate individuals. Both the sellers and the buyers knew that the sale would place control of the bank in the buying group. Both also recognized that such a sale justified a higher price per share than if the stock were sold in lesser lots and to separate buyers instead of to a group acting jointly. The record shows that the stock was sold at a price yielding a profit to the sellers.
The contract between Woodrum and the appellees contemplated just such a sale. The contracting parties intended that a control block of stock was the quantity of stock that would bring the best price and that sale of such control would necessarily be made in a single transaction to one person, one firm, or one corporation, or to one legal entity capable under the law of taking and holding that controlling interest.
The term "one person, firm or corporation," as a designation of the party to whom the sale would be made, was incidental and subordinate to the general intent of the contract to sell control of the bank in a single transaction, in order to produce a profit for the three contracting parties. A similar conclusion was reached, in construing this term, by a California court in Berylwood Investment Company v. Graham, 43 Cal. App. 2d 659, 111 P.2d 467.
Cowan and Jacobsen satisfied the purposes and intent of the contract of May 12, 1965, when they sold 162,191 shares of stock to the group of five principals from Abilene. The sale placed controlling interest, in excess of fifty-one percent of the stock, in one entity, a group of men seeking such control and obligated by their mutual agreements, and by their contract with the Fort Worth National Bank, to hold control of the bank intact for a period of time appearing under the facts to be substantial in duration. Such a sale, by which control passed in one transaction from one group to another, was calculated to bring a better price per share of stock and to produce the very profit Cowan and Jacobsen contracted to share with Woodrum by paying to him "his 1/3 share of the profit."
Appellees, as defendants below, moved for summary judgment "on the ground that there is no genuine issue as to any material fact and that defendants are entitled to judgment as a matter of law." The trial court, being of the opinion that the motion should be sustained, rendered judgment sustaining the motion and that plaintiff recover nothing from defendants.
In rendering judgment for defendants, the question was whether the summary judgment proof established as a matter of law that there was no genuine issue of fact as to one or more of the essential elements of the plaintiff's cause of *600 action. Gibbs v. General Motors Corporation, 450 S.W.2d 827 (Tex.Sup.1970). All doubts as to existence of a genuine issue as to a material fact will be resolved against the party moving for summary judgment, and the burden of such proof is upon the movant. It is not the purpose of Rule 166-A, Texas Rules Civ.Proc., governing summary judgments, to deprive a litigant of his right to a full hearing on the merits of any real issue of fact. Gulbenkian v. Penn, 151 Tex. 412, 252 S.W.2d 929 (1952). Appellees failed under the summary judgment proof to establish as a matter of law that there was no genuine issue of fact as to one or more of the essential elements of plaintiff's cause of action.
We hold that the purchasers of the stock were joint venturers, and that the sale to them was tantamount to a sale to a firm within the meaning and intent of the contract. The judgment of the trial court sustaining defendants' motion for summary judgment, and rendering judgment that plaintiff take nothing is reversed; and the cause is remanded to the trial court for determination of the issue of damages and rendition of judgment consistent with this opinion.
Reversed and remanded. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534360/ | 283 Pa. Super. 565 (1980)
424 A.2d 1345
COMMONWEALTH of Pennsylvania
v.
Levi RHEM, Appellant.
Superior Court of Pennsylvania.
Argued March 18, 1980.
Filed November 21, 1980.
Reargument Denied February 11, 1981.
*568 Richard J. Conn, Philadelphia, for appellant.
Lise Rapaport, Assistant District Attorney, Philadelphia, for Commonwealth, appellee.
Before HESTER, WICKERSHAM and LIPEZ, JJ.
HESTER, Judge:
Appellant Levi Rhem was convicted in a jury trial of charges of possessing instruments of crime, attempted robbery, and two counts of robbery in the Court of Common Pleas, Philadelphia County. Post-trial motions were argued and denied and an aggregate sentence of six to twenty years imprisonment was imposed. This direct appeal followed.
Facts adduced at trial established the following. In the early morning hours of July 3, 1978, complainants Raymond Carter and his sister Joyce were in their home at 2024 North *569 20th Street in Philadelphia. Visiting with Mr. Carter at that time was Miss Gustine McKenzie, also a complainant herein. Mr. Carter was summoned by a knock to the front door where he was met by appellant and co-defendant David Benson standing on the porch. One of these individuals inquired of Mr. Carter whether he was "cool",[1] to which Carter replied "No." The visitors turned to leave but suddenly spun around brandishing guns and demanded to know where Carter's money and drugs were. Benson accompanied Carter to the upstairs bedroom while appellant proceeded to the living room and relieved Miss McKenzie of her money and a watch. He then ordered her to walk upstairs. In the second floor bedroom, Carter and Miss McKenzie sat on the bed while appellant and Benson struck them with their guns and demanded money. Appellant roused Joyce Carter from her third floor bedroom and ordered her to join the others on the second floor. At this point, the police arrived and began knocking loudly on the front door.[2] Appellant and Benson forced their captives downstairs and onto the floor and then hid their guns. The robbers answered the front door and were thereafter arrested.
Both defendants testified at trial as to their version of the events of July 3rd. Essentially, their claim was that in the late evening of July 2nd, they had purchased some poor quality drugs from Raymond Carter, and that early on July 3rd they had returned to Carter's house to demand their money back. They maintained that once inside Carter's house, a fight ensued, instigated by Carter, and that when the police arrived they tried to explain that they, defendants, had been "burned" by Carter, the complainant, in a bad drug buy.
Based upon the foregoing, we must reject appellant's contention that the evidence was insufficient to establish every element of the crimes beyond a reasonable doubt. *570 Commonwealth v. Smith, 484 Pa. 71, 398 A.2d 948 (1979). Moreover, the fact that there were a few inconsistencies and minor variations in the Commonwealth's witnesses does not render the verdict against the weight of the evidence. Commonwealth v. Hinchcliffe, 479 Pa. 551, 388 A.2d 1068 (1978); Commonwealth v. Kahley, 467 Pa. 272, 356 A.2d 745 (1976).
Next, appellant contends that the court committed error in eliciting evidence of appellant's silence at his arrest. However, our review of the record simply does not bear out this contention. During his cross-examination, appellant was asked, without objection, whether he told the arresting officers that he had not robbed the complainants but was merely in the house to discuss a drug buy. Appellant stated that he tried to tell the officers this fact but that they "didn't want to hear that." N.T. 4214. Shortly thereafter, the court engaged appellant in the allegedly objectionable inquiry:
THE COURT: When you got to the district, did you tell them that you had purchased bad drugs there?
THE WITNESS: They wouldn't let me say nothing.
THE COURT: When you got to a hearing, there were lawyers there, were there not?
[Appellant's counsel] Objection.
N.T. 4222-3.
We do not agree with appellant that the foregoing constitutes a reference to appellant's silence after arrest, as construed by our cases:
"The law is clear. It is reversible error to admit evidence of a defendant's silence at the time of his arrest. Commonwealth v. Stafford, 450 Pa. 252, 299 A.2d 590 (1973); Commonwealth v. Haideman, 449 Pa. 367, 296 A.2d 765 (1972). The prohibition of any reference to an accused's silence reflects the court's desire that an accused not be penalized for exercising his constitutional rights. Commonwealth v. Stafford, supra; Commonwealth v. Haideman, supra; Miranda v. Arizona, [supra]. It is a recognition that most lay persons would view an assertion of the constitutional privilege as an admission of guilt. *571 Commonwealth v. Haideman, 449 Pa. at 371, 296 A.2d at 767, citing Walker v. United States, 404 F.2d 900, 903 (5th Cir. 1968)." 465 Pa. at 403, 350 A.2d at 828. (Emphasis added).
Commonwealth v. Greco, 465 Pa. 400, 404, 350 A.2d 826, 828 (1976); Commonwealth v. Williams, 252 Pa.Super. 435, 381 A.2d 1285, 1289 (1977). See also, Commonwealth v. Brown, 271 Pa.Super. 331, 413 A.2d 692 (1979); Commonwealth v. Anderjack, 271 Pa.Super. 334, 413 A.2d 693 (1979). The rationale for the rule quite clearly undercuts appellant's argument. Appellant was not attempting to "exercise his constitutional right" to remain silent. Greco, supra; Commonwealth v. Singletary, 478 Pa. 610, 387 A.2d 656 (1978). Indeed, according to his own testimony, he was making every effort to speak to the officers and present his version of the events. Moreover, we find no "admission of guilt" which a juror may glean from the quoted testimony. On the contrary, appellant was vehemently protesting his innocence but was frustrated in his endeavors. This is simply not a case of an impermissible reference to post-arrest silence in the fact of accusation or interrogation. Compare, Commonwealth v. Myers, 266 Pa.Super. 566, 405 A.2d 1252 (1979); Commonwealth v. Easley, 483 Pa. 337, 396 A.2d 1198 (1979); Commonwealth v. Seel, 76 Pa.Super. 481, 406 A.2d 1148 (1979); Commonwealth v. Hall, 264 Pa.Super. 261, 399 A.2d 767 (1979); Commonwealth v. Flynn, 248 Pa.Super. 62, 374 A.2d 1317 (1977). Since there was no impermissible reference to appellant's silence, there was likewise no error in failing to give a cautionary instruction.
Appellant next assigns as error several instances in the record wherein the court aggressively cross-examined him and made certain comments indicating disbelief in appellant. The rule of law limiting the trial judge's participation in the examination of witnesses is well-settled:
Witnesses should be interrogated by the judge only when he conceives the interest of justice so requires. It is better to permit counsel to bring out the evidence and clear up disputed points on cross-examination unaided by *572 the court .... The practice of a judge entering into the trial of a case as an advocate is emphatically disapproved. The judge occupies an exalted and dignified position; he is the one person to whom the jury, with rare exceptions, looks for guidance and from whom litigants expect absolute impartiality .... [H]e should not, during the trial, indicate an opinion, on the merits, a doubt as to the witnesses' credibility, or do anything to indicate a leaning to one side or the other, without explaining to the jury that all these matters are for them.
Accord, Commonwealth v. Seabrook, 475 Pa. 38, 379 A.2d 564 (1977); Commonwealth v. Miller, 442 Pa. 95, 275 A.2d 328 (1971); Commonwealth v. Elmore, 241 Pa.Super. 470, 362 A.2d 348 (1976); Commonwealth v. Lanza, 228 Pa.Super. 300, 323 A.2d 178 (1974); ABA Standards Relating to the Function of the Trial Judge, § 6.4, p. 19 (1972).
Commonwealth v. Toombs, 269 Pa.Super. 256, 409 A.2d 876, 877 (1979), quoting, Commonwealth v. Myma, 278 Pa. 505, 508, 123 A. 486, 487 (1924); See also, Commonwealth v. Williams, 468 Pa. 453, 364 A.2d 281 (1976); Commonwealth v. Laws, 474 Pa. 318, 378 A.2d 812 (1977).
The first instance of alleged error occurred following appellant's cross-examination wherein the judge attempted to clarify the purchase price of methadrine. During appellant's direct examination, he stated that he and co-defendant Benson purchased $100.00 worth of "monster", or methadrine, from Mr. Carter on July 2 but that this substance was in reality something other than methadrine and had made appellant and Benson ill upon injection. Appellant then stated he and his companion returned to the Carter home to discover exactly what Carter had sold them. Since appellant's expectation of what he was buying was crucial to his defense, the court sought to establish the quantity of "monster" appellant could buy for $100.00. Appellant at first expressed ignorance as to the exact quantity, N.T. 4.217, but then stated that $15.00 would buy "a spoon", N.T. 4.219, and that $100.00 brings "enough `monster' that would last me two weeks or so" N.T. 4.220. The court's questions were *573 clearly relevant to appellant's defense, were brief in nature, and did not indicate favor or disfavor with appellant. Moreover, the court clearly set forth in its instructions that the jury must be the sole judges of credibility. Finally, we note that counsel failed to object to the court's questions concerning drugs. We thus believe the issue to be waived and, in the alternative, without merit.
Appellant argues that the judge made a disparaging comment which limited the effect of counsel's cross-examination of a Commonwealth witness. Miss McKenzie testified that in the upstairs bedroom Benson struck her with a gun while the appellant struck Mr. Carter. On cross, counsel sought to impeach her through her testimony at the preliminary hearing wherein she stated:
"Then they asked did he have any money and he said no, he hadn't any money in two years. So then he struck Raymond and he struck me." N.T. 2.43.
The court sustained the Commonwealth's objection that the statement was not inconsistent, noting "[T]he grammar here is horrendous." N.T. 2.45. We agree that the preliminary hearing testimony was at best ambiguous as to who struck who. The court's comments did not prejudice appellant.
Appellant complains that the court labelled counsel's cross-examination of Joyce Carter as "trivial", N.T. 3.107. However, we note that the court nonetheless permitted counsel to continue his line of inquiry for some time. This comment, either in isolation or in tandem with other allegedly prejudicial comments, was simply not the type which would deprive appellant of a fair trial. See, Commonwealth v. Ryder, 467 Pa. 484, 359 A.2d 379 (1976) (court's observation that defense counsel's question of a witness was "ridiculous", held, did not deprive defendant of a fair trial). Similarly, the court's suggestion that the issue of drugs was "irrelevant" during cross-examination of a police witness, N.T. 3.222, was not prejudicial since counsel was permitted to pursue his line of inquiry. Further, the issue of drugs was not in fact relevant until the defense began its case.
*574 Appellant complains that the court improperly admitted evidence prejudicial to him. During cross-examination of Raymond Carter, counsel for co-defendant Benson elicited testimony to the effect that relatives of Benson offered money to Carter if he, Carter, would agree not to testify. N.T. 3.26-33. It was clear that there were no relatives of appellant who had made such an offer. N.T. 3.34. Thus, while the evidence may have been arguably prejudicial to Benson, appellant was not affected in any way. His counsel was granted leave to cross-examine Carter on this limited issue, N.T. 3.36, but in fact never did so. Later, counsel for Benson elected to call Benson's mother, Jessie Scott, who would testify that Carter had approached her shortly after the incident and said, "As long as [Benson] doesn't say anything about drugs . . . we are going to forget the whole thing", N.T. 4.104. Benson's counsel thus hoped to rebut Carter's allegations that Benson's relatives had offered restitution. The court refused to allow Ms. Scott to testify, finding her proffered evidence irrelevant and collateral. We again find no prejudice to appellant since it was always co-defendant Benson's relatives who were allegedly in dialogue with Carter. Appellant would gain nothing by Ms. Scott's testimony since he lost nothing by Carter's. Further, the offer of proof as to Ms. Scott did not suggest that a robbery had not taken place on July 3rd; it seemed Carter was attempting nothing more than to settle the parties' differences out of court.
Appellant contends he was improperly limited in his cross-examination of several witnesses and was prevented from presenting his defense. We have carefully examined the instances in the record wherein Commonwealth objections to defense cross-examination were sustained. We do not find that appellant was limited in any way from presenting his defense. The court merely directed counsel to develop his defense during his own case in chief. The issue of drugs was simply not a relevant point until the defense began its case when appellant was presented with a full opportunity to present his defense. The scope of cross-examination *575 is within the discretion of the trial judge and will not be reversed absent an abuse of discretion. Commonwealth v. Greene, 469 Pa. 399, 366 A.2d 234 (1976); Commonwealth v. Lee, 262 Pa.Super. 280, 396 A.2d 755 (1978). An abuse of discretion will not be found if the defendant's right to full and effective cross-examination is not abridged, even if the defense is not permitted to cross-examine in the manner it desires. Commonwealth v. Garcia, 478 Pa. 406, 387 A.2d 46 (1978). In view of the full and vigorous cross-examination conducted by counsel and the unimpeded presentation of his defense, we find no error.
Appellant cites several portions of the court's charge to the jury as requiring reversal.
This Court has consistently held that, in reviewing jury instructions for prejudicial and reversible error, the charge must be read and considered as a whole. Commonwealth v. Lesher, 473 Pa. 141, 373 A.2d 1088 (1977). Error cannot be predicated on isolated excerpts of the charge. It is the general effect of the charge that controls. See Commonwealth v. Archambault, 448 Pa. 90, 290 A.2d 72 (1972).
Commonwealth v. Woodward, 483 Pa. 1, 7, 394 A.2d 508, 510 (1978).
Appellant objected to the court's use of the word "victims" throughout the charge, arguing that employment of such a term assumes a robbery in fact occurred when the defense contended otherwise. The court corrected whatever arguable error may have occurred when it told the jury that the complainants were only "alleged victims". N.T. 3.99. Appellant took no further exceptions to this additional instruction.
Appellant avers the court told the jury that the defendants' accusations of drugs and a drug sale did not eliminate the possibility of a robbery from the case. However, our review of this portion of the charge[3] reveals the *576 court was merely stressing that even if the jury believed the complainants were "bad", people involved with drugs, that they could still be victims of a robbery. Moreover, the court never, as appellant suggests, "assumed" that a robbery occurred; on the contrary, it very clearly set forth the presumption of innocence and the Commonwealth's burden of proof.
Appellant avers that the court erred in refusing his requested points for charge, Nos. 9, 10, 11. However, these points merely set forth the elements of robbery and theft and incorporate appellant's version of the events of July 3. The court clearly instructed the jury as to the elements of the offenses and submitted all factual issues to them.
It is well established that a trial judge is not required to accept a requested instruction verbatim, even if legally correct and timely filed. The court is free to select its own form of expression, so long as the issue is adequately, accurately and clearly presented to the jury. Commonwealth v. McComb, 462 Pa. 504, 341 A.2d 496 (1975); Commonwealth v. Reston, 224 Pa.Super. 80, 302 A.2d 428 (1973). Where the basic charge properly covers a requested point, it is not error for the trial judge to refuse to give additional instructions. Commonwealth v. Newsome, 462 Pa. 106, 337 A.2d 904 (1975).
Commonwealth v. Gardner, 246 Pa.Super. 582, 371 A.2d 986, 989-90 (1977). There was no error.
Similarly, there was no error in the instructions as bearing upon complainant Raymond Carter's criminal record. *577 Carter admitted during the trial that he had been convicted in the past of burglary and receiving stolen property. N.T. 2.158-9. In the instructions, the court told the jury that this evidence is to be used only in testing the credibility of the witnesses and does not mean that he could not be a victim in the case. N.T. 5.84-5. We think the charge was in accord with existing law. Feldman, Pa.Trial Guide, § 6.34 (1973).
Appellant next invokes the six-hour rule of Commonwealth v. Davenport, 471 Pa. 278, 370 A.2d 301 (1977), in support of his contention that certain physical evidence should have been suppressed. The facts show that the crime occurred at approximately 1:00 a.m. on July 3, 1978 and that appellant was arrested shortly thereafter in the Carter home. At the North Central Detective Division, appellant was searched and items identified as taken in the robbery were seized from his person. At the suppression hearing, the Commonwealth did not produce evidence of the time of arraignment contending that the Davenport rule did not apply to physical evidence. We agree. The Supreme Court stated the Davenport holding succinctly:
In light of our experience since Commonwealth v. Futch, 447 Pa. 389, 290 A.2d 417 (1972), we conclude that, pursuant to our supervisory power, we should adopt a rule under which the admissibility of any statement taken while the accused is in custody before preliminary arraignment is based on the length of the delay between arrest and arraignment. If the accused is not arraigned within six hours of arrest, any statement obtained after arrest but before arraignment shall not be admissible at trial. If the accused is arraigned within six hours of arrest, pre-arraignment delay shall not be grounds of suppression of such statements except as the delay may be relevant to constitutional standards of admissibility. See Commonwealth v. Eiland, 450 Pa. 566, 301 A.2d 651 (1973); Commonwealth ex rel. Butler v. Rundle, 429 Pa. 141, 239 A.2d 426 (1968). 471 Pa. at 286, 370 A.2d at 306 (footnotes omitted).
*578 Compare, Commonwealth v. Ryles, 274 Pa.Super. 547, 418 A.2d 542 (S. 226/79; filed 1/18/80). By its very terms, the six-hour rule is only applicable to inculpatory statements[4] and not physical evidence. The inherent coercion during an unnecessary delay which may result in an invalid waiver of important constitutional rights is simply not present in Fourth Amendment cases where the search proceeds despite the accused's objections. Thus, the coercive influence against which Futch and Davenport were designed to guard is absent in the instant case since appellant was not asked to waive any rights. The court properly denied the motion to suppress.
Lastly, appellant contends he was arrested without probable cause and that a prima facie case was not established at the preliminary hearing. We have carefully examined these averments and find them completely lacking in merit. See Commonwealth v. Tolbert, 235 Pa.Super. 227, 341 A.2d 198 (1975); Commonwealth v. Rick, 244 Pa.Super. 33, 366 A.2d 302 (1976); Interest of Gonzales, 266 Pa.Super. 468, 405 A.2d 529 (1979).
Judgment of sentence affirmed.
NOTES
[1] "Cool" is apparently street language meaning to have or sell drugs.
[2] Unbeknownst to anyone in the Carter house, a neighbor, one Tina Warren, had Witnessed part of the robbery and summoned the police.
[3] Appellant's objection is directed toward the following language:
Now, you have heard accusations about drugs and you have also heard details about the very same accusations. The point I wish to make is this: If you find there is any truth in the accusation, it would not be any less robbery if that were the defendants' intentions and that is actually what happened. You see, ladies and gentlemen, the law is determined to protect the powerful and also to protect the weak. It is determined to protect black people, it is determined to protect white people. It is determined to protect beautiful people, it is determined to protect ugly people. It is determined to protect bishops and burglars. It is determined to protect virgins and it is determined to protect prostitutes. N.T. 589.
[4] The rule probably applies to uncounseled lineup identifications as well. See, Futch, supra. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534409/ | 468 S.W.2d 646 (1971)
STATE of Missouri, Respondent,
v.
Herbert Ned TATE, Appellant.
No. 55876.
Supreme Court of Missouri, Division No. 1.
June 28, 1971.
*647 John C. Danforth, Atty. Gen., J. Michael Jarrard, Asst. Atty. Gen., Jefferson City, for respondent.
Harold F. Fullwood, Francis P. Dorsey, St. Louis, for appellant.
HOUSER, Commissioner.
This a direct appeal by Herbert Ned Tate from a judgment of conviction and sentence of life imprisonment on a charge of murder in the first degree.
Tate and four others were jointly indicted for the murder of Mike LoGrasso in his restaurant during the course of a holdup.
State's witness Claude Johnson testified that four men, Berry, Brantner, McKinney and Fair, three of whom were armed, entered *648 the restaurant and that one Wright and Herbert Tate were outside. Cross-examination of Johnson was waived, whereupon the following occurred:
"THE COURT: That's Fair, Brantner, and McKinney, and Wright were the four who came in? Is that what you told us?
THE WITNESS: Yes, sir. And Berry.
THE COURT: And Berry. Berry was one of the four. Who were the two who stayed outside?
MR. DORSEY [counsel for appellant]: Your Honor, we object to this.
MR. FULLWOOD [co-counsel for appellant]: Object to this repetition from the bench.
MR. DORSEY: We want to make a record on that.
MR. FULLWOOD: We want to make a record on that."
Out of the hearing of the jury counsel for appellant objected to the court "taking an active part in the prosecution of this case" and "giving the jury the implication that this boy was involved in something," and asked the court to instruct the jury to disregard the court's remark and that a mistrial be declared. The court then in the presence of the jury instructed the jury to disregard his use of the phrase "remained outside." Appellant's counsel again objected on the ground that the last comment "just added fuel to the fire," was a comment on the evidence, and requested the court to instruct the jury to disregard all remarks made by the court and that a mistrial be declared. These requests were overruled.
Appellant's first point on appeal is that the foregoing could reasonably be construed by the jury to indicate that the trial judge believed defendant accompanied the others to the restaurant as an accomplice, which was contrary to appellant's defense. Appellant quotes § 546.380, RSMo 1969, V.A.M.S., which prohibits the court from commenting on the evidence, and cites and quotes from State v. Jones, Mo. Sup., 197 S.W. 156, and State v. Castino, Mo.Sup., 264 S.W.2d 372, 375, on the duty of a trial judge to avoid any indication of feeling against the accused in criminal trials; to be absolutely impartial both in his conduct and remarks, and not say anything that can be construed by the jury to prejudice the defendant. We reaffirm the solemn obligation of trial judges in these respects, but this record does not demonstrate feeling or partiality on the part of the judge or prejudice to appellant's rights. It is obvious that the judge was attempting to clarify the witness' testimony as to who was inside and who was outside the restaurant at the time of the shooting. The court has the right and duty to propound additional questions to clarify testimony and absent an abuse of discretion operating to deny the accused a fair trial prejudicial error is not demonstrated. State v. Grant, Mo.Sup., 394 S.W.2d 285; State v. Lay, Mo.Sup., 427 S.W.2d 394, 403. The trial judge's use of the phrase "stayed outside" was clearly an inadvertent misquotation of the witness' testimony, which was corrected and rendered harmless by his instruction to disregard. The discrepancy between "remained" outside and "stayed" outside is not a matter of such consequence as to amount to prejudicial error.
Appellant's second point is that the court erred in allowing the State to impeach its witness, Mary Jones, without first showing that she was hostile and without laying a foundation by showing entrapment or surprise.
Appellant's defense was that although he was with the other men while the crime was being planned he remonstrated with them, and tried to dissuade them; that although he went to the restaurant with the others he tried to keep Berry from entering the restaurant; that he did not see any of his associates in possession of guns; *649 that he was not disguised (as were the four who entered the restaurant) and was not armed; that he stayed outside, and that when he heard the shot he ran home and stayed there.
Mary Jones, in whose home the crime was planned, testified for the State, naming defendant Herbert Tate as one of the men who was at her house, with Berry, McKinney, Fair, and Wright, while the robbery was being planned. When asked to name the persons who came back to her house after the commission of the crime she named Berry, McKinney, Fair and Wright but failed to mention Herbert Tate as one of the men who returned to her house. The State's attorney asked permission to cross-examine the witness as to a prior inconsistent statement to the extent of asking her whether she made a prior statement in writing that Tate was present with the others at her house after the holdup and that Tate had said that Berry didn't have to shoot the man. Objections that no foundation had been laid for the inquiry and that this was an improper way to impeach a witness were overruled, and the following exchange took place:
"Q [by the State's attorney]: Do you recall last June telling me that one of those present at the time of this meeting following the holdup was Berry, Fair, and McKinney, and so on, that one of the men present was Herbert Ned Tate?
A Yes.
Q All right. And is that in fact the truth?
A Yes."
Appellant takes the position that this constituted impeachment of the witness and, citing cases,[1] seeks to invoke the rule that a party cannot impeach his own witness by proof of the witness' prior inconsistent statements merely because the witness fails to testify to the facts as expected; that the witness must go further and testify in favor of the opposite party, producing a situation amounting to an entrapment before he becomes adverse so as to warrant his impeachment by the party producing him.
That rule is inapplicable in the situation revealed by this record. Mary Jones was a willing witness. She testified in behalf of the State, freely and openly. She demonstrated no hostility, adverseness, or evasiveness. She did not indicate any disposition to suppress the truth. There was no necessity of impeachment. Obviously she merely forgot that Tate was among those present at the time in question. Patently this was not a situation in which it was necessary to formally impeach the witness by confronting her with an inconsistent extrajudicial statement, but rather was a situation which called for the refreshing of the witness' memory. As soon as the June conference with the assistant circuit attorney was recalled her memory was refreshed as to the statement she had made at that time about Tate; she readily remembered the fact and confirmed her prior statement as the truth. There was no effort to introduce the typed statement in evidence; it was not offered or received. So the rule relied upon is not applicable. Instead, the rules with respect to the refreshing of the memory of a party's witnesses come into play. "The refreshing of a witness' memory is a matter resting in the discretion of the trial court, whose rulings will not be disturbed in the absence of abuse of discretion." Brown v. Chicago, R. I. & P. Ry. Co., 315 Mo. 409, 286 S.W. 45, 50. State v. Patton, 255 Mo. 245, 164 S.W. 223, held that a witness, being fair and truthful and desirous of stating the facts as they were, but whose *650 memory is hazy from lapse of time, may have his present recollection refreshed by reference to and use of data made in his presence or dictated by him. This rule has been employed frequently, as late as State v. Renfro, Mo.Sup., 408 S.W.2d 57, 59. The State's attorney had the typewritten record of his interview with Mary Jones in hand, and although the record does not show that he exhibited it to her, it is obvious that he used it in framing the questions calculated to refresh the witness' present recollection. We find no abuse of discretion in the action of the court. Brown v. Chicago, R. I. & P. Ry. Co., supra; State v. Gregory, 339 Mo. 133, 96 S.W.2d 47, 55 [10]; Woelfle v. Connecticut Mut. Life Ins. Co., 234 Mo.App. 135, 112 S.W.2d 865, 874 [15].
Finally, appellant complains of certain remarks made by the State's attorney in his argument to the jury. The State's attorney, being of the opinion that the reason Mike LoGrasso was shot was that he could produce no more money, argued that from the evidence that the cash register was emptied; that LoGrasso's wallet was taken from him; that more money was demanded; that when he could produce no more money one of the robbers said, "Shoot him, Walter," whereupon LoGrasso was shot and killed, the jury could draw the conclusion that the reason the robbers shot him was that he could not produce more money. He also pointed out the possibility that the jury could arrive at any other conclusion, adding "Perhaps they're just mean punks." Appellant's counsel objected "to this type of argument" as beyond the scope of the evidence, inflammatory and prejudicial, and asked for a mistrial. The court overruled the objection and the request for a mistrial. We find no fault with this "type" of argument (that the killing was vengeful, based upon a senseless reason, or simply because the robbers were evil young tramps). "Mean punks" is strong language but in the face of evidence of a brutal, insensate, vindictive killing the remark may be considered as a reasonable deduction and a legitimate comment on the evidence, even as the State's attorney's reference in State v. Ayers, Mo.Sup., 305 S.W.2d 484, to defendant and his companion as "desperados" and "hoodlums" was considered a justifiable inference and not an epithet hurled at defendant. The same may be said of the reference to appellant as "a vicious man." In State v. Topalovacki, Mo.Sup., 213 S.W. 104, the court was not prepared to say that the prosecutor's reference to the defendant as a "scoundrel," although deemed violent language, was not justified by the circumstances (rape of a little girl).
Exception is taken to the following: "You know the evidence, and you can draw whatever conclusions are necessary from the vicious, mad-dog acts of these men that were there; and if it isn't because there was no more money, then there is perhaps no human motive that can be attributed to the men who committed this * * *." This was objected to as the personal opinion, the personal comment of the circuit attorney, and a reprimand and a mistrial were requested. The court denied both, but admonished the State's attorney as follows: "I understand, Mr. Darst, any opinions that you state must be based upon the evidence, and not your personal opinions." The "mad-dog" argument was improper and the court would have been acting properly to sustain the objection, reprimand counsel, strike it from the record and instruct the jury to disregard it. The court's admonishment, however, was in effect a sustaining of the objection and constituted a mild rebuke. Whether counsel's improper remarks on argument call for reprimand or discharge of the jury is a matter resting largely within the trial court's discretion, State v. Whipkey, 361 Mo. 1008, 238 S.W.2d 374, and the appellate court will not interfere unless the record shows an abuse of discretion to the prejudice of the appellant. State v. Madden, Mo.Sup., 394 S.W.2d 317. "The court *651 was in a far better position than we are to determine the remedial measures required, and we cannot say, as a matter of law, that in the circumstances we have here it erred in refusing to take the drastic step of declaring a mistrial and discharging the jury." State v. Nolan, Mo.Sup., 423 S.W.2d 815, 819.
Later the State's attorney argued: "Mike LoGrasso is dead and none of us have to be there or have been there [sic] to be able to testify about it because the odds are that if we had been there we'd be as dead as Mike LoGrasso." This was objected to as highly prejudicial and the court was requested to instruct the jury to disregard it and to declare a mistrial. The court instructed the jury to disregard it, thereby inferentially sustaining the objection, but overruled the motion for a mistrial. Assuming that the remark was improper, it is not ground for a reversal of the judgment, in view of the action of the court. State v. Smith, 250 Mo. 350, 157 S.W. 319, 324-325 [8]. A mistrial should be granted only "where the incident is so grievous that the prejudicial effect can be removed no other way." State v. Nolan, supra, 423 S.W.2d, 1.c. 818. We find no abuse of discretion in the denial of a mistrial.
No reversible error appearing, the judgment of conviction is affirmed.
WELBORN and HIGGINS, CC., concur.
PER CURIAM:
The foregoing opinion by HOUSER, C., is adopted as opinion of the court.
All of the Judges concur.
NOTES
[1] State v. Hogan, 352 Mo. 379, 177 S.W.2d 465; State v. Adams, 355 Mo. 1186, 200 S.W.2d 75; State v. Walker, 357 Mo. 394, 208 S.W.2d 233, 237, and State v. Drummins, 274 Mo. 632, 204 S.W. 271. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534467/ | 468 S.W.2d 685 (1971)
STATE of Missouri, Plaintiff-Respondent,
v.
Oren Tempelton EDMONDS, Defendant-Appellant.
No. 33846.
St. Louis Court of Appeals, Missouri.
May 25, 1971.
*686 Williams & Rush, Paul E. Williams, Bowling Green, for defendant-appellant.
James Millan, Pros. Atty., Bowling Green, for plaintiff-respondent.
SMITH, Commissioner.
Defendant was convicted by a jury of driving while intoxicated and fined $100. He appeals, raising only the question of whether the court erred in refusing to allow a nonexpert witness to give his opinion that defendant was not intoxicated.
The State's case consisted solely of the testimony of the state trooper who testified to defendant's erratic driving, that he was unsteady on his feet, that his eyes were watery, and that he had the smell of intoxicating beverage on his breath. The trooper also testified that immediately after being stopped defendant spontaneously remarked, "I knew I shouldn't have been driving it." The trooper, over objection, gave his opinion that defendant was intoxicated. He conducted no tests on defendant, chemical, physicial, or of coordination.
Defendant admitted driving the vehicle at the time and place charged, and defended solely on the basis that he was not intoxicated.
In support of this defense he adduced testimony that he is on medication to control tuberculosis, that he had taken such medication on the night in question and that the medication had made him dizzy. He did not deny the erratic driving, but stated he did not remember that he had driven erratically nor did he remember making the statement attributed to him. He testified that when he was twenty-one or twenty-two years old[1] he had had a severe illness which left him with a permanent unsteadiness of gait and lack of balance. Defendant admitted that from 4:00 p. m. on the date of the arrest until 8:00 p. m. he had consumed five cans of five per cent beer. From about 6:00 p. m. until about 10:00 p. m. he had been at a party. He testified he ate about 8:00 p. m. and had nothing to drink thereafter. He left the party at approximately 10:00 p. m. and the arrest was made at 10:20 p. m. while defendant was driving home. There is no evidence of any stops by defendant after leaving the party and before his arrest and defendant's testimony would indicate none were made.
The court's ruling on which defendant premises error arose during the testimony of defendant's friend of twelve years, who was with him at the party. Because the court's ruling was based upon lack of foundation we must set forth at some length the pertinent testimony leading up to the ruling.
"Q How long have you been acquainted with Oren T. Edmonds? A Oh, almost twelve years. Q In that length of time have you known him at work? A Yes, sir. Q Have you known him socially after hours? A Yes, sir. Q * * * I will ask you if you were with him just before he was arrested? A He was at the party we was having. Yes, I seen him. We had dinner together. Q Let me ask you about what time was it when you first saw him on that evening? A Oh, I would say approximately *687 around 6:00 o'clock. Maybe a little later. Q And then were you with him continuously up to the time that he left the party? A Well, there was several people he mingled with off and on. I seen him several times during the party and talked to him. Q How many people were at this party in round figures? A Oh, probably fifteen adults and that many children. * * * Q Did you notice anything unusual about his behavior either during the first part of the evening or the last part of the evening? A No, I did not. * * * Q Was there a meal served at this party? A Yes, there was. Q About what time was that? A Approximately 8:00 o'clock. Q Did you see him during the meal? A Yes. Q Was he drinking anything at that time? A No. Q Did you see him after the meal? A Yes. Q Was he drinking anything at that time? A I never seen him with anything. * * * Q Were you in the courtroom when Trooper Gaines testified that he was unsteady on his feet on this occasion? A Yes, I was. Q Have you been around Oren Edmonds long enough and observed him enough to observe anything about his general steadiness on his feet? A As long as I have known him he has been unsteady on his feet. You see him walk you think he is going to fall pretty regular. Q Is he unsteady on his feet when he hasn't had anything to drink? A Yes, he is. Q Have you been around people who have had quite a lot to drink? A Yes. Q People that have had a little and quite a bit and an awful lot, you have been around people in all stages of drinking, is that a fair statement? A Yes, I have. Yes, it is. Q Did Mr. Edmonds leave the party before you did? A Yes, he did. Q Did you see him just before he left? A Shortly before he left, yes. Q By shortly, are you speaking in terms of like five minutes, ten minutes, something of that kind? A Probably five to ten minutes I imagine. * * * Q Answering yes or no, do you have an opinion as to whether or not the defendant was drunk when he left the party? A Yes, I have an opinion. Q Okay. Do not answer this question until Mr. Millan has had a chance to object. In your opinion was he drunk? Don't answer. MR. MILLAN: Now I object, your Honor, on the ground that this witness isn't qualified to answer. THE COURT: I am going to sustain the objection at this time on the ground that sufficient foundation hasn't been laid. Q All right. Mr. Wundelich, do you drink on occasion? A Yes, sir. Q Have you been around a lot of people who did at one time or another? A Yes, sir. Q In your observations do intoxicated people have certain symptoms that when you see these symptoms you are inclined to say he is drunk? A Some people do I would say, yes. Q Well, are these symptoms the standard ones such as staggering and slurred speech and that type thing? A Yes, sir. * * * Q * * * have you ever watched somebody get drunk? A Well, drink with people, yes. And they have got pretty wellI would think intoxicated, yes. Myself, too. Q Over how many years would this experience reach with people in general on intoxication? A Oh, probably eighteensixteen, eighteen years. Q I will ask you again whether or not in your opinion, and don't answer, whether or not in your opinion this defendant was drunk when he left the party on this particular night? MR. MILLAN: The State makes the same objection. THE COURT: The Court will make the same ruling at this time. Sustained."
From the objection made and the court's ruling we are unable to tell whether the ruling was based on the witness' lack of qualification as an expert or upon a lack of sufficient evidentiary basis to express an opinion.
It is true that the admission or exclusion of opinion testimony is largely within the discretion of the trial court. Anderson v. Robertson, Mo.App., 402 S.W.2d 589 [8]. Judicial discretion is the option the trial judge has in doing or not doing a thing which cannot be demanded by a litigant as an absolute right. Such discretionary rulings are reviewable to determine *688 abuse. Abuse occurs when a trial court's ruling is clearly against the logic of the circumstances then before the court and is so arbitrary and unreasonable as to shock the sense of justice and indicate a lack of careful consideration. We presume that a discretionary ruling is correct and cast the burden of showing abuse upon appellant. Anderson v. Robertson, supra, [1, 2, 3, 4]. Under the circumstances here we find the trial court abused its discretion in rejecting the proferred testimony.
It is clear that a lay or non-expert witness may testify as to his opinion of the intoxication of another. The fact of intoxication is by its nature ordinarily a matter of opinion which must be shown by men not expert in such matters. State v. Hatcher, 303 Mo. 13, 259 S.W. 467 [9, 10]; State v. Revard, 341 Mo. 170, 106 S.W.2d 906 [7, 8]; State v. Powell, Mo., 306 S.W.2d 531 [1]; State v. Mayabb, Mo., 316 S.W.2d 609 [5, 6]; Limbaugh v. Forum Lunch Co., Mo.App., 258 S.W. 451 [5, 6]. Normally, where the witness is testifying that the person involved was intoxicated the opinion must be preceded or at least supported by the evidentiary facts of conduct or appearance upon which the witness bases his opinion. We have found no case in Missouri on what evidentiary facts must appear when the witness is testifying to non-intoxication. We believe, however, that the evidentiary rules dealing with opinion testimony of sanity or insanity are equally applicable to testimony of sobriety or drunkenness. A lay witness when giving an opinion that a person is of unsound mind must state the conduct or actions upon which he founds that opinion in order that the jury may determine whether the abnormalities testified to justify the opinion. Such factual basis is not required where the witness expresses an opinion of sanity, for there the opinion is based upon the absence of abnormalities. The opinion is not based on concrete facts demonstrating insanity but on the absence of such facts. See In re Bearden, Mo.App., 86 S.W.2d 585 [7, 8]. The same is true in the area of intoxication. An opinion of intoxication is based upon actions and appearances not normal, whereas an opinion of non-intoxication is based upon the absence of such actions and appearances. Here the witness testified that he noticed nothing "unusual about his [defendant's] behavior."
The witness' testimony reflects that he was in off-and-on contact with defendant for some four hours, that he talked with him "several" times, that he had known defendant socially and in his employment for some twelve years, that he had dinner with him on the night of the arrest and that he saw defendant within a few minutes before defendant left the party. He further testified to his experience in being around intoxicated persons. The testimony reveals that the witness had the experience to give an opinion, sufficient contact with defendant on the night in question to give an opinion, and that he was sufficiently acquainted with defendant to know what was normal conduct for defendant. This furnished an adequate foundation for the opinion sought.
Defendant's only defense was that he was not intoxicated. The State's case to a very real degree was based upon the opinion of the trooper that defendant was intoxicated. Defendant was entitled to have the jury consider the opinion of his witness of non-intoxication. The weight of such opinion was of course for the jury. We hold the trial court abused its discretion in sustaining the objection.
The judgment is reversed and the cause remanded for new trial.
PER CURIAM:
The foregoing opinion by SMITH, C., is adopted as the opinion of this court. Accordingly, the judgment is reversed and the cause remanded for new trial.
BRADY, P. J., and WOLFE, J., concur.
DOWD, J., not sitting.
NOTES
[1] Defendant was fifty-seven at the time of trial. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534469/ | 251 B.R. 547 (2000)
In re William Henry REDDING and Alice Patricia Redding, Debtors.
No. 98-30985-1.
United States Bankruptcy Court, W.D. Missouri, Western Division.
August 9, 2000.
*548 *549 David E. Schroeder, Springfield, MO, James B. Fleischaker, Joplin, MO, for debtor.
MEMORANDUM OPINION AND ORDER
JERRY VENTERS, Bankruptcy Judge.
This matter is before the Court on remand from the Bankruptcy Appellate Panel for the Eighth Circuit.
On December 21, 1999, this Court entered a Memorandum Opinion and Order in which it ordered David E. Schroeder, bankruptcy counsel for the Debtors, William Henry Redding and Alice Patricia Redding ("Debtors"), to disgorge the sum of $10,011.40 in attorney's fee payments which Schroeder had received from the Debtors. On April 28, 2000, the Bankruptcy Appellate Panel for the Eighth Circuit ("BAP") reversed this Court's decision, holding that this Court had improperly reviewed Schroeder's fee application under 11 U.S.C. § 330, and remanded to this Court for consideration of the fees pursuant to 11 U.S.C. § 329 and Rule 2016(b), FED.R.BANKR.P., and for the consideration of sanctions pursuant to this District's Local Rule 2016-1.
This Court has jurisdiction of these matters under 28 U.S.C. §§ 157(a) and (b)(1) and 1334.
FACTUAL BACKGROUND
The factual background giving rise to this matter is fully set out in In re Redding, 242 B.R. 468 (Bankr.W.D.Mo.1999) ("Redding I"), this Court's December 21, 1999, opinion, and is summarized in In re Redding, 247 B.R. 474 (8th Cir. BAP 2000) ("Redding II"), the BAP's April 28, 2000, opinion. Therefore, it is not necessary to recount the history of the matter in such full detail in this Memorandum Opinion and Order. The pertinent facts can be briefly summarized as follows:
The Debtors filed a "quick file" Chapter 13 petition on November 5, 1998, to forestall a foreclosure sale scheduled that same afternoon on an apartment complex owned by the Debtors. Schroeder filed an initial disclosure of compensation form indicating that he had been paid a prepetition retainer fee of $3,000.00. Shortly thereafter, on January 21, 1999, Schroeder filed, on behalf of the Debtors, an application to convert the Chapter 13 to a Chapter 11 proceeding, and an order effecting that conversion was entered on the following day. Subsequently, confronted with a Motion to Lift Stay filed by their principal *550 creditors, Frank and Dorothy Dell,[1] ("Dells") the Debtors consented to a conversion of the case to Chapter 7, under which the case has since continued.
On July 29, 1999, another attorney, James B. Fleischaker, entered his appearance on behalf of the Debtors for the express and limited purpose of representing them in opposing the Proof of Claim that had been filed by the Dells. At a hearing on September 23, 1999, it came to the Court's attention that Fleischaker had not filed an application to be employed as special counsel for the Debtors. Soon thereafter, Fleischaker filed an application for employment, but he did not disclose that he had been paid any retainer or other fees by the Debtors. However, on November 2, 1999, Fleischaker filed a fee application in which he revealed that he had already been paid $4,414.83 by the Debtors and was holding an additional $2,000.00 in his escrow account to be applied to his fees for October.
Prior to this time, the Panel Trustee, Norman E. Rouse, had learned through Rule 2004 examinations that the Debtors had paid a substantial amount of money to Schroeder and Fleischaker post-petition in payment of their legal fees and expenses. Consequently, on November 2, 1999, the same day Fleischaker filed his fee application, the Trustee filed a Motion for Disgorgement of Attorney's Fees, in which he asked that Schroeder and Fleischaker be compelled to disgorge the fees they had received from the Debtors without Court approval. Schroeder filed a response to the Trustee's Motion in which he admitted that he had received $11,011.40 in payments from the Debtors (including the $3,000.00 retainer fee originally disclosed) and admitting that he had violated Rule 1016(b) by not disclosing all of the payments received. Schroeder also stated that he believed that the cash payments that were made to him had not come from any assets of the bankruptcy estate, but if they had, they were "innocently received."
It was not until November 30, 1999, that Schroeder filed an application for approval and payment of his attorney's fee. This fee application, which is the application now before the Court, requested Court approval for $14,715.00 in fees and $1,001.96 in expenses, a total of $15,716.96. On the same day, Schroeder filed what he called a Supplemental Statement of Compensation of Attorney for Debtors in which he enumerated, for the first time, the various payments he had received from the Debtors the initial $3,000.00 retainer in November 1998; $4,500.00 on May 28, 1999; $761.40 on August 20, 1999; and $2,750.00 on October 6, 1999. All of these payments (with the exception of the retainer), which totaled $11,011.40, were received by Schroeder, in cash, after he sent invoices to the Debtors and without prior approval from the Court.
As previously indicated, this Court on December 21, 1999, entered an Order disapproving the fees awarded Schroeder (and Fleischaker, as well). Schroeder appealed this Court's Order to the BAP, and, as noted above, the BAP reversed and remanded to this Court for further consideration under 11 U.S.C. § 329, Rule 2016(b), and this Court's Rule 2016-1.[2]
DISCUSSION
A. Reasonableness of Schroeder's fees
First, the Court considers the reasonableness of Schroeder's requested fees under § 329, which provides:
Debtor's transactions with attorneys
(a) Any attorney representing a debtor in a case under this title, or in connection with such a case, whether or not such attorney applies for compensation under this title, shall file with the court a statement of the compensation paid or agreed to be paid, if such payment or *551 agreement was made after one year before the date of filing of the petition, for services rendered or to be rendered in contemplation of or in connection with the case by such attorney, and the source of such compensation.
(b) If such compensation exceeds the reasonable value of any such services, the court may cancel any such agreement, or order the return of any such payment, to the extent excessive, to
(1) the estate, if the property transferred
(A) would have been property of the estate; or
(B) was to be paid by or on behalf of the debtor under a plan under chapter 11, 12, or 13 of this title; or
(2) the entity that made such payment.
11 U.S.C. § 329.
Although the Trustee has not objected to the reasonableness of Schroeder's fees, the Court may nevertheless make an independent determination of their reasonableness. Redding II, 247 B.R. at 479. The Court has wide discretion in making a determination of the reasonableness of a debtor's attorney's fees. In re Willow Lake Partners II, L.P., 156 B.R. 638, 644 (Bankr.W.D.Mo.1993).
The Court has reviewed the detailed itemization submitted by Schroeder in tandem with his fee application and does not find the fees requested to be unreasonable. While some issue might be taken with the wisdom of some of the services provided, the Court is not going to second-guess Schroeder's judgment at this point. This has been a somewhat complicated case, made more so by the acrimonious relationship of the Debtors and the Dells. The Debtors apparently believed they had affirmative claims to assert against the Dells, and those required some investigation and led to the employment of Fleischaker as the Debtors' special counsel. At the same time, the Dells had filed a Proof of Claim which the Debtors opposed. Therefore, under all the circumstances, the Court will find the fees to be reasonable, and will not order any disgorgement of fees on the basis that they are unreasonable or excessive.
B. Counsel's noncompliance with statutes and rules
The second issue to be considered counsel's noncompliance with the statutes and rules and the sanctions to be imposed, if any is another matter, however.
In addition to § 329, this issue involves a consideration of Rule 2016(b), FED. R.BANKR.P., and this Court's Local Rule 2016-1. Rule 2016(b) provides:
(b) Disclosure of Compensation Paid or Promised to Attorney for Debtor.
Every attorney for a debtor, whether or not the attorney applies for compensation, shall file and transmit to the United States trustee within 15 days after the order for relief, or at another time as the court may direct, the statement required by § 329 of the Code including whether the attorney has shared or agreed to share the compensation with any other entity. . . . A supplemental statement shall be filed and transmitted to the United States trustee within 15 days after any payment or agreement not previously disclosed. (emphasis added)
FED.R.BANKR.P. 2016(b).
This Court's Local Rule 2016-1 provides, in pertinent part:
A. Prepetition Retainers. The disclosure of amount of retainer by debtor's counsel pursuant to § 329 and Bankruptcy Rule 2016(b) shall be filed with the petition and served on the U.S. Trustee and any trustee. All professionals shall deposit retainers, whether received from debtor or any other source, in a trust account, and withdraw and apply funds only after a fee application and order. (emphasis added)
B. When Application Unnecessary. If counsel's total fee in a case is $1,000 or less, the disclosure of fee in initial *552 filings is sufficient and it is unnecessary to file any itemized application. . . .
* * * * * *
D. Applications Over $1,000. For applications over $1,000, in addition to service in Paragraph A, applicant shall serve on all creditors a notice . . . stating: the amount of fees and expenses sought; period covered; number of previous applications filed; amounts of compensation previously sought and allowed; original retainer and balance; that parties have 20 days to object, if no objections are filed the Court may enter an order, and if objections are filed the Court may set a hearing.
Local Rule 2016-1.
As the Court detailed in its opinion in Redding I, Schroeder (as well as Fleischaker) blatantly disregarded and violated the statutes and rules with respect to obtaining Court approval of their fees and expenses. Schroeder's compliance with the statutes and rules basically ended with the filing of his initial disclosure of compensation in November 1998. His later, very tardy attempt to comply with Rule 2016(b) and Local Rule 2016-1 was largely forced upon him by the Trustee's filing of a motion to compel him to disgorge whatever fee payments he had received in violation of the rules.
It is well established that bankruptcy courts have broad and inherent authority to deny any and all compensation when an attorney fails to comply with the provisions of §§ 327, 329, 330 and 331. Franke v. Tiffany (In re Lewis), 113 F.3d 1040, 1045 (9th Cir.1997). The Eighth Circuit Court of Appeals has held that, where a debtor's attorney has failed to comply with the statute and the rules, subsequent fee applications "should be denied and the funds received should be ordered returned to the estate." Lavender v. Wood Law Firm, 785 F.2d 247, 248 (8th Cir.1986) (emphasis added). It is worthy of note that the Eighth Circuit used the word should and not the word may, thereby giving a strong indication that disgorgement of the fees received is the expected and proper remedy to be applied. See also, In re Downs, 103 F.3d 472, 479 (6th Cir.1996) ("[T]he bankruptcy court should deny all compensation to an attorney who exhibits a willful disregard of his fiduciary obligations to fully disclose the nature and circumstances of his fee arrangement under § 329 and Rule 2016. The authority to do so is inherent, and in the face of such infractions should be wielded forcefully."); Matter of Prudhomme, 43 F.3d 1000, 1003 (5th Cir.1995) ("[T]he court's broad discretion in awarding and denying fees paid in connection with bankruptcy proceedings empowers the bankruptcy court to order disgorgement as a sanction to debtors' counsel for nondisclosure."); In re Westside Creek Limited Partnership, 93 B.R. 177, 180-81 (Bankr.E.D.Ark.1988) ("Failure of attorney to comply with the requirement of the Bankruptcy Code to obtain prior court approval is a basis for ordering the estate to be reimbursed for fees improperly received.").
In this case, Schroeder has been paid $11,011.40 by the Debtors, but only $1,000.00 of that was received by Schroeder in compliance with the statutes and rules. Although Schroeder initially disclosed that he had been paid $3,000.00 prepetition by the Debtors, he never sought court approval for the excess over $1,000.00, as is required by this Court's Local Rule 2016-1, until a year later and after he had applied the excess to payment of his fees. Therefore, all amounts over $1,000.00 (namely, $10,011.40) were received without appropriate court approval and without prior disclosure to the Court or to creditors.
This, then, brings us to the issue of the appropriate sanctions to be imposed for Schroeder's violations. Bankruptcy courts generally have substantial discretion in fashioning sanctions; however, they must exercise that power with restraint and the sanction imposed must be commensurate with the egregiousness of the *553 conduct. Downs, 103 F.3d at 478. The Court may exercise its discretion and deny or reduce fees for counsel's failure to disclose his fee arrangements, whether or not actual harm accrues to the estate. In re Central Florida Metal Fabrication, Inc., 207 B.R. 742, 749 (Bankr.N.D.Fla.1997). "The disclosure requirements impose upon attorneys an independent responsibility. Thus, failure to comply with the disclosure rules is a sanctionable violation, even if proper disclosure would have shown that the attorney had not actually violated any Bankruptcy Code provision or any Bankruptcy Rule." In re Woodfield Gardens Associates, 1998 WL 276453 (Bankr. N.D.Ill.).[3] A failure or refusal to disclose fee payments has long been recognized as a sufficient basis for an attorney's disqualification or for disgorgement of fees. In re Keller Financial Services of Florida, Inc., 248 B.R. 859, 886 (Bankr.M.D.Fla.2000); In re Independent Engineering Co., Inc., 232 B.R. 529, 532 (1st Cir. BAP 1999); In re Envirodyne Industries, Inc., 150 B.R. 1008 (Bankr.N.D.Ill.1993); In re Dixon, 143 B.R. 671, 680 (Bankr.N.D.Tex.1992).
Schroeder, understandably, has argued against any sanctions, stating that his violations were not so egregious as to warrant sanctions. The Court strongly disagrees. Schroeder's violations of his responsibilities under the Code and the Rules were knowing, deliberate, and blatant. As an experienced bankruptcy attorney, Schroeder is doubtlessly well aware of the requirements of full disclosure of attorney fees in bankruptcy cases, and is likewise well aware of the necessity for obtaining prior Court approval for the payment of fees by debtors. In this case, Schroeder, for reasons totally unknown to the Court, chose to disregard those rules and requirements. At no time did he comply with the requirement of Rule 2016(b) that he file a supplemental disclosure statement within 15 days after receiving any payment from the debtors. From the beginning, Schroeder failed to comply with this Court's Local Rule 2016-1, which required the Court's approval for all fees in excess of $1,000.00. Though Schroeder initially disclosed that he had received a $3,000.00 pre-petition retainer, he never sought Court approval for the amount over $1,000.00. One thing that is particularly disturbing is that Schroeder sent statements to his clients at various times throughout these proceedings and thereby solicited their payment of his fees and expenses without obtaining prior Court approval. Schroeder's disregard for the rules and his ethical responsibilities continued for almost a year, until his grudging compliance was forced upon him by the filing of the Trustee's motion for disgorgement.
As the Court stated in Redding I, this Court will not condone such violations of the Bankruptcy Code and Rules and this Court's Local Rule 2016-1. If such violations are allowed to go unpunished, this Court may as well repeal Local Rule 2016-1, because it will be rendered meaningless and ineffective. The Rule is designed and intended to prevent occurrences such as this one, and it will be strictly enforced for that reason. This Court is not so far removed from the private practice of law to have forgotten the necessity of collecting the legal fees that have been earned through long hours of hard work, but those fees must be collected through strict compliance with the attorney's responsibilities under the Bankruptcy Code and Rules.
Disgorgement of the payments Schroeder received without compliance with the Rules is appropriate, and Schroeder will be ordered to disgorge and pay over to the Trustee the sum of $10,011.40. However, inasmuch as the Court has found the fees and expenses charged to be reasonable and the Debtors have not objected to them, the Court will allow payment of the fees to be made on a subordinated, nonpriority basis. Payment of the entirety of Schroeder's fees will be subordinated to *554 the general unsecured creditors in this Chapter 7 proceeding. There is substantial property in this bankruptcy estate, and it appears possible that there will be sufficient assets to pay the administrative costs and the claims of the general unsecured creditors (primarily the Dells) in full, after which Schroeder may be paid. If there are not sufficient funds with which to pay Schroeder, then Schroeder will not be paid, and that will be the price to be paid for his disregard of the statutes and rules. It would be grossly unfair to allow Schroeder to receive payment of his fees in advance of the payment of the claims of the general unsecured creditors; to do that would be to require the general unsecured creditors to bear the cost of attorney's fees that were improperly received in the first instance and would effectively reward Schroeder for his open defiance of the Rules.
There is one final issue that must be resolved. There has been no evidence adduced in this case to establish the source of the funds that were used to pay Schroeder's and Fleischaker's fees and expenses. In Redding I, the Court held that the funds were property of the estate; the Court found that the Debtors had transferred $20,911.04 from a certificate of deposit to their son in Florida within three months of the bankruptcy filing, and that that money was used to pay the post-petition legal fees and expenses. However, the BAP held this finding to be clearly erroneous. Since the BAP's ruling, the Trustee has obtained a default judgment against the Debtors' son, Richard DeCoursey, for $20,911.04, representing the amount of funds improperly transferred by the Debtors. On August 7, 2000, counsel for DeCoursey filed a Motion to set aside the default judgment on various grounds, and in that motion counsel has asserted that DeCoursey never received the $20,911.04 from the Debtors. These developments make it obvious that a further evidentiary hearing will be required to determine the source of the funds used to pay Schroeder's and Fleischaker's fees and expenses. If the funds were property of the estate, the Trustee will be permitted to retain the disgorged amounts and distribute them pursuant to the Bankruptcy Code and this Order. If it is found that the funds were not property of the estate, the Court will direct the Trustee to return the funds to the proper party.
Therefore, it is
ORDERED that David E. Schroeder be and is hereby directed to disgorge the sum of $10,011.40 to the Trustee, Norman E. Rouse, forthwith, as a sanction for Schroeder's violation of the Bankruptcy Code and Rules and this Court's Rule 2016-1. It is
FURTHER ORDERED that the fees and expenses of David E. Schroeder, in the total amount of $15,716.96, are found to be reasonable and not excessive pursuant to 11 U.S.C. § 329, and the payment of such fees and expenses shall be subordinated to the payment of the general unsecured creditors in this Chapter 7 proceeding. It is
FURTHER ORDERED that a further evidentiary hearing will be conducted by the Court to determine the source of the funds used to pay the Debtors' legal fees and expenses, so as to make a determination of whether the funds are or are not property of the bankruptcy estate.
SO ORDERED.
NOTES
[1] Acting on behalf of the Frank and Dorothy Dell Family Trust.
[2] Fleischaker did not take an appeal and the December 21, 1999, Order is final as to him.
[3] Despite the age of the case, only the West-law cite is available at this time. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534520/ | 813 S.W.2d 489 (1991)
Brenda POWERS, Petitioner,
v.
Paul PALACIOS, Respondent.
No. D-0371.
Supreme Court of Texas.
June 12, 1991.
Rehearing Overruled September 11, 1991.
*490 Andrew J. Lehrman, Bradford M. Condit, Corpus Christi, for petitioner.
William R. Kendall, L. Nelson Hall, Kathryn F. Green, Corpus Christi, for respondent.
PER CURIAM.
We consider whether a private litigant in a civil case may use a peremptory challenge to exclude a juror on account of race. Based on Edmonson v. Leesville Concrete Co., Inc., ___ U.S. ___, 111 S. Ct. 2077, 114 L. Ed. 2d 660 (1991), we hold that such an exclusion violates the equal protection rights of the challenged juror. We reverse and remand for a new trial.
Brenda Powers brought suit against Paul Palacios for injuries she suffered in a pit bull attack. At voir dire, after counsel for Palacios exercised his peremptory challenges, Powers sought to pose questions to opposing counsel to establish a racially discriminatory use of a peremptory strike. The trial court overruled both this request and a related attempt to make a bill of exception. Upon inquiry from the trial court, however, counsel for Palacios did concede that race was a factor in his determination to exercise the peremptory challenge.[1] At the end of the trial, the jury returned a verdict against Powers and the trial judge rendered a take-nothing judgment against her.
On appeal, Powers asserted a constitutional violation arising from the use of a peremptory strike against a venireperson based on race. Relying on Edmonson v. Leesville Concrete Co., Inc., 895 F.2d 218, 219 (5th Cir.1990) (en banc), the court of appeals held that, because no state action is present in a civil case between private litigants, no constitutional violation occurred. 794 S.W.2d 493 at 495.
Subsequent to the appellate court's opinion, the United States Supreme Court reversed the Fifth Circuit's decision, determining state action is present in the exercise by a private litigant of peremptory challenges pursuant to statute or decisional law and the enforcement of those strikes *491 by the court in the empaneling of the jury. Emphasizing that "[rjacial discrimination has no place in the courtroom, whether the proceeding is civil or criminal," the Court held that "courts must entertain a challenge to a private litigant's racially discriminatory use of peremptory challenges in a civil trial." Edmonson, ___ U.S. at___, 111 S.Ct. at 2088 (1991). The Supreme Court thus extended its previous opinions discussing the unconstitutional use of peremptory challenges in criminal actions to civil litigation. See Powers v. Ohio, ___ U.S.___, 111 S. Ct. 1364, 113 L. Ed. 2d 411 (1991); Batson v. Kentucky, 476 U.S. 79, 106 S. Ct. 1712, 90 L. Ed. 2d 69 (1986).
Here, Powers established that opposing counsel had exercised a peremptory challenge discriminatorily.[2] Such "automatic invocation of race stereotypes retards [our] progress [as a multiracial democracy] and causes continued hurt and injury." Edmonson, ___ U.S. at ___,111 S.Ct. at 2088. We hold that equal protection is denied when race is a factor in counsel's exercise of a peremptory challenge to a prospective juror.
Pursuant to Tex.R.App.P. 170, we grant Powers's application for writ of error, and without hearing oral argument a majority of the Court reverses the judgment of the court of appeals and remands the case for a new trial.
NOTES
[1] The following exchange took place before the trial court when Mr. Lehrman, Powers's counsel, was attempting to make a bill of exception:
[Mr. Lehrman] Okay. Can I put briefly on the stand Mr. Hall [Palacios's attorney]? This is a challenge based on race, Your Honor. We believe that this juror was struck
[The Court] Excuse me. You got any authority for that?
[Mr. Lehrman] No, I have authority for a criminal matter. I don't have authority for a civil matter.
[The Court] Thatthat request will be overruled.
[Mr. Lehrman] Okay, Well, can I make a bill of exception, Your Honor?
[The Court] No, sir, unless you have some authority.
* * * * * *
[Mr. Lehrman] ... There was one juror on this panel that was black. Ms. Powers is black, and I just feel that that juror was struck; it might have been for the race. And I think for purposes of just having it in the record, that's all. It's a simple matter. It will take me two seconds to announce that on the bill of exception.
[The Court] And that is overruled.
[Mr. Lehrman] Okay. Just for the record, I... would ... just simply state that the purpose of the bill of exception was to ask Counsel whether or not as a motive or as a decision in striking No. 25, which I've asked the Court to take judicial knowledge of, Marsha Hardeman, who appeared to me to be a black potential juror, whether or not that in any way was motivated by the race of Ms. Hardeman, due to the fact that
[The Court] The Court will ask Mr. Hall. Were you motivated by race to strike her?
[Mr. Hall] Well
[The Court] I don't know how you're going to answer that.
[Mr. Hall] All I can stay [sic] is not improperly, but it certainly figured into it, but it was not the sole reason for striking her, no.
[The Court] Gentlemen, it's still overruled.
[2] This peremptory challenge in civil litigation was exercised pursuant to Texas Rules of Civil Procedure 232 and 233. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534527/ | 813 S.W.2d 99 (1991)
Michael IRWIN, Plaintiff-Appellant,
v.
WAL-MART STORES, INC., Defendant-Respondent, and
SmithKline Bioscience Laboratories, Ltd., Defendant-Respondent.
No. WD 43707.
Missouri Court of Appeals, Western District.
July 9, 1991.
*100 Charles L. House (argued), James P. Cannon, Kansas City, for plaintiff-appellant.
Stanley E. Craven Kansas City, for Wal-Mart. Patrick C. Cena, Kansas City, for SmithKline.
Before NUGENT, P.J., WASSERSTROM, Senior Judge, and KENNEDY and GAITAN, JJ.
NUGENT, Presiding Judge.
Plaintiff Michael Irwin appeals from the trial court's entry of summary judgment in favor of defendants Wal-Mart Stores, Inc., and SmithKline Bioscience Laboratories, Ltd. We affirm the judgment of the trial court.
The plaintiff raises nine points on appeal. We do not address each point individually, in part because several points raise issues similar to each other, and in part because the plaintiff, in violation of Rule 84.04(d), has failed to cite any authority to support his arguments on five points, Thummel v. King, 570 S.W.2d 679, 687 (Mo.1978) (en banc); Ortmeyer v. Bruemmer, 680 S.W.2d 384, 396 (Mo.App.1984), and in one *101 point has not set out what action or ruling of the court he deems erroneous and the extant error. Thummel, supra, at 685; Ruffino v. Russell, 786 S.W.2d 152, 153 (Mo.App.1990). Nevertheless, because our courts follow the policy of deciding cases on the merits wherever possible, Thummel, supra, at 690, we address the issues raised by the plaintiff. Those we have narrowed to three: whether Wal-Mart acted negligently in dismissing him; whether SmithKline acted negligently in concluding that his urine sample revealed traces of a controlled substance; and whether either defendant slandered and libeled him in reporting the results of his urinalysis.
In January, 1989, plaintiff Irwin, a managerial employee of Wal-Mart, signed a consent form involving mandatory drug testing. Basically, the form stipulated that he consented to taking drug tests; that if a test revealed traces of a controlled substance in his body he would take a thirty-day unpaid leave of absence during which time he would participate in a drug rehabilitation program; and if he did not participate in the program or did participate and failed, Wal-Mart could fire him. Shortly thereafter, the company instructed him to submit to a urinalysis. He did so at a doctor's office. The urine sample, in a sealed container signed by Mr. Irwin went to SmithKline's laboratory, which had contracted with Wal-Mart to analyze Wal-Mart employees' urine specimens. SmithKline tested the specimen twice. Both tests revealed traces of cocaine in the urine.
On January 31, Wal-Mart told Mr. Irwin of the result and suspended him for thirty days without pay, effective on February 4. In a deposition Mr. Irwin testified that on January 31 he submitted another specimen to the doctor who had taken the first. He further testified that that specimen tested negative for drugs, that he offered the test result to Wal-Mart, and that Wal-Mart refused to consider that result.
Three weeks into his suspension, Wal-Mart told the plaintiff that it would permit him an additional thirty days in which to undergo the drug rehabilitation program. He refused to enter a program and the company fired him. Wal-Mart listed the reason for his termination as his refusal to enter a drug treatment program after testing positive. In his service letter, the company, in part, explained that Mr. Irwin "was placed on a leave of absence without pay when, during a routine drug screening, results of a urinalysis revealed an unacceptable level of a controlled substance in his system."
The plaintiff filed this action against both defendants, and the trial court entered summary judgment. SmithKline proffered the result of Mr. Irwin's urinalysis. The plaintiff submitted neither the result of the second urinalysis nor the deposition of the doctor or laboratory technician who ran the second test.
We review a summary judgment as we would any court-tried or equity proceeding. If we can sustain the judgment under any theory, we must do so. McReady v. Southard, 671 S.W.2d 385, 387 (Mo.App.1984). If the trial court has reached a correct result for incorrect reasons, we still must affirm. Labor Discount Center, Inc. v. State Bank & Trust Co. of Wellston, 526 S.W.2d 407, 429 (Mo. App.1975). We review the entire record in the light favorable to the party against whom the trial court entered judgment. Fisher v. Scott & Fetzer Co., 664 S.W.2d 662, 663 (Mo.App.1984).
A trial court must exercise great care in utilizing summary judgment. Gal v. Bishop, 674 S.W.2d 680, 682 (Mo.App. 1984). It may enter summary judgment where the pleadings, depositions and admissions on file, together with the affidavits, if any, show that no genuine issue of material fact exists and that the law entitles the moving party to a favorable judgment. Ronollo v. Jacobs, 775 S.W.2d 121, 125 (Mo.1989) (en banc); Rule 74.04(c). The motion need not rest upon unassailable proof. Schwartz v. Lawson, 797 S.W.2d 828, 832 (Mo.App.1990). To overcome a motion for summary judgment, the opposing party may not rest upon mere allegations or denials, but must set forth specific facts that demonstrate the existence of an outstanding genuine issue of material fact.
*102 St. Charles County v. Dardenne Realty Co., 771 S.W.2d 828, 830 (Mo.1989) (en banc). Facts of such probative value as would control or determine the litigation constitute "material facts." Schneider v. Forsythe Group, Inc., 782 S.W.2d 139, 142 (Mo.App.1989). Mere doubt and speculation do not create a genuine issue of material fact. St. Charles County, supra. Rather, the record must demonstrate a factual question that would permit a reasonable jury to return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S. Ct. 2505, 2509, 91 L. Ed. 2d 202 (1986).
Mr. Irwin has adduced nothing that raises a genuine issue of material fact in his allegation that Wal-Mart acted negligently in dismissing him. No jury question exists where the uncontradicted record shows that he signed an agreement acknowledging the company's right to dismiss him if he tested positive for drugs and then refused to participate in a drug rehabilitation program and that he indeed tested positive, refused the program, and the company fired him.
Plaintiff Irwin adduced nothing other than his own doubts and speculation that SmithKline acted negligently in concluding that his specimen indicated cocaine in his system. The company adduced evidence of its testing technique demonstrating credibility, and the plaintiff introduced no evidence raising a genuine issue of material fact regarding the validity of that technique.
Finally, plaintiff Irwin placed nothing in the record that tended to show that either defendant engaged in libelous or slanderous behavior. Truth serves as a complete defense to an accusation of defamation. Pulliam v. Bond, 406 S.W.2d 635, 642 (Mo.1966). SmithKline reported to Wal-Mart only that the plaintiff's urinalysis showed that his system contained cocaine. Wal-Mart, in turn, reported in his service letter only that his drug test showed an unacceptable level of a controlled substance in his system. Contrary to Mr. Irwin's allegations, neither defendant accused him of illegally obtaining a drug or illegally using a drug. They each reported cold facts, which coincidentally may have led others to infer illegal drug use. Again, plaintiff Irwin raises no genuine issue of material fact necessitating a jury's decision.
The trial court acted properly in entering summary judgment for the defendants because the plaintiff failed to raise a single genuine issue of material fact. Accordingly, we affirm the judgment of the trial court.
All concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534703/ | 426 Pa. 305 (1967)
Commonwealth
v.
Howard, Appellant.
Supreme Court of Pennsylvania.
Argued March 16, 1967.
July 25, 1967.
*306 Before BELL, C.J., MUSMANNO, JONES, COHEN, EAGEN, O'BRIEN and ROBERTS, JJ.
H. David Rothman, Trial Defender, with him George H. Ross, Public Defender, for appellant.
*307 Edwin J. Martin, Assistant District Attorney, with him Charles B. Watkins, Assistant District Attorney, and Robert W. Duggan, District Attorney, for Commonwealth, appellee.
OPINION BY MR. JUSTICE O'BRIEN, July 25, 1967:
On April 11, 1966, appellant, Stanley Howard, with the advice of counsel, entered a plea of guilty generally to an indictment for murder in the death of Clifford Grogan. After a hearing, wherein extensive testimony was taken and documentary evidence was reviewed, the court en banc fixed the degree of guilt as murder in the first degree and imposed the death penalty. The appellant filed a motion in arrest of judgment and, after submission of briefs and oral argument, the court, on October 25, 1966, by its opinion and order, denied the motion. On November 2, 1966, the death sentence was formally announced in open court, where appellant, with counsel, was present. This appeal followed.
On November 12, 1965, at approximately 3:30 P.M., Lorance J. Weyandt, a lieutenant of the guards, was standing in the yard of the Western State Correctional Institution at Pittsburgh conversing with another guard, John Fred Walz. Suddenly and without warning, someone came up behind Weyandt, and he received what he described as "a hard blow in the back". He wheeled around and confronted Stanley Howard, the appellant, who was then an inmate at that institution. Howard was facing him with a knife in his right hand. Howard advanced toward Weyandt, and Weyandt began backing away. Howard then swung the knife and, with a sweeping motion, struck the officer in the chest. Walz ran over to assist Weyandt and the appellant, Howard, turned upon him, cursing, and shouted "Do you want it too?". Walz ran to obtain assistance. Weyandt continued backing away, holding his hands in front of him. At this point, tradesmen instructor *308 Clifford Grogan came on the scene and approached Howard from behind. Just before Grogan was able to seize the appellant, Howard spun sideways and struck at Grogan with the knife. Grogan jumped backward, attempting to avoid the thrust, and in doing so, fell to the ground. He kicked out at the appellant and in the same motion rolled over onto his right side. Appellant, Howard, thereupon stabbed Grogan in the left side. Howard then stepped over his victim in a straddling position and, while Grogan was on his hands and knees and Howard was straddling him across the hips, Howard proceeded to stab Grogan twice in the right side.
By this time, other guards rushed to the scene and Howard was seized, subdued, and disarmed. It was at this point that Weyandt discovered that the blow which he had felt in his back had been a stab wound inflicted by the appellant. Weyandt recovered from this stab wound, but Grogan died shortly thereafter from the stab wounds which he had received.
Interrogation of Weyandt at trial revealed that he had had no personal contact with the appellant which would have resulted in any animosity between them. Officer Weyandt further indicated at the trial that from the time he felt the pain in his back until he saw Grogan attempting to restrain Howard was only a matter of seconds. Weyandt further indicated at the preliminary hearing that the demeanor of the appellant was that of someone who was mad or angry. There is no evidence to indicate that Grogan was ever known by Howard.
The history of Stanley Howard is very well covered by the court below as follows:
"Stanley Howard was born on May 18, 1939, in New Jersey, the youngest of six children. In November, 1943, following the breakup of his parents' marriage, he was placed in a foster home, under the care *309 of a Mrs. Halsey. In January, 1944, Mrs. Halsey reported that he was `misbehaving' and that she could not handle him, and he was therefore placed with a Mrs. Gilbert. In October, 1947, it is reported that Howard was stealing from Mrs. Gilbert's grandson. In December, 1948, Howard was reported annoying an elderly man on the way to school. In February, 1949, he is reported to have been a school problem, and in July, 1949, he climbed out of a school bus and ran away. In August, 1949, he was reported to have been dumping garbage cans into the hallways of apartment buildings adjacent to his own. By the end of 1949, Mrs. Gilbert reported that he was constantly staying out late and running around and that she was unable to handle him. In January, 1950, he was placed in the home of a Mrs. Ford. She reported that he lied to her as to his activities, stayed out late, and was a disciplinary problem.
"In April, 1950, he was placed in the home of a Mrs. Dumas. On July 10, 1950, he broke the window of a bakery shop, and on October 24, 1950, he broke a number of windows at school. Finally, in October, 1951, Mrs. Dumas reported that Howard had run away for a week-end, had committed thefts from her, and that she was unable to control him. On November 1, 1951, a Juvenile Court hearing was held, involving the thefts from Mrs. Dumas. Howard was placed on one year's probation and placed in an institutional home. He was, at this time, 12 years old.
"In January, 1952, he was placed with his mother, who it appears, was living in Philadelphia in an adulterous relationship.
"Within a relatively short time, Howard was arrested for aggravated assault and battery, and sent to the Glen Mills School. He adjusted poorly at Glen Mills, and was transferred to the State Correctional Institution at Camp Hill in 1954, where he remained *310 until 1958. He returned to living with his mother until 1960 when he enlisted in the Army.
"While in the service, he was court-martialed four times and was given an undesirable discharge in August, 1961. He once again returned to Philadelphia and resided with his mother.
"In April, 1962, Howard was convicted of aggravated assault and battery and sentenced to 6 to 22 months. On October 14, 1962, he was paroled.
"On November 3, 1962, he broke into a home in Philadelphia, stole money and jewelry, and raped the woman occupant. The victim's husband returned while Howard was still present, and a struggle ensued, with Howard inflicting a cutting upon the husband and escaping.
"On November 23, 1962, he robbed a grocery store and physically assaulted the woman proprietor with his fists.
"On December 15, 1962, and again on December 22, 1962, he committed robberies while armed with a rifle, and on December 25, 1962, he robbed a taproom while armed with a shotgun.
"Howard was apprehended on December 26, 1962. He pleaded guilty and, following a hearing on February 14, 1963, was sentenced to a total of 30 to 60 years in prison.
"He was sent initially to the State Correctional Institution at Graterford. His record there indicates a number of disciplinary offenses. In June, 1964, he was twice admitted to the hospital following apparent suicide attempts, once by cutting his forearms and the other by attempted hanging by his bedsheet.
"He was transferred to the Eastern State Correctional Institution at Philadelphia on July 14, 1964. On August 25, 1965, Howard attacked an inmate named Murphy with a knife, for which he was tried and received an additional 1 to 2 year sentence. As a result *311 of this attack, he was transferred to the State Correctional Institution at Pittsburgh on March 31, 1965.
"Upon reception at the State Correctional Institution at Pittsburgh, he was placed in administrative segregation for observation and thereafter was released into the general prison population on May 3, 1965.
"On July 2, 1965, he was charged with refusing to be searched and threatening an officer, and as a result was returned to administrative segregation. On July 9, 1965, while confined to segregation, he attacked an inmate named Joseph Weaver with a lock wrapped in a sock, as a result of which Weaver was hospitalized, and Howard was placed in punitive segregation. He was finally released from segregation on November 8, 1965. Four days later, on November 12, 1965, the attack upon Weyandt and the killing of Grogan occurred.
"On February 21, 1966, Howard physically attacked his court-appointed attorney who was in the process of consulting with Howard in his cell."
The court below, in its opinion, discusses the psychiatric evaluation of the appellant upon his arrival at the Eastern State Correctional Institution, where he was examined by Dr. Melvin S. Heller, a psychiatrist. Dr. Heller classified appellant's problem as "a long-standing character disorder of the dissocial type, manifested by a long history of anti-social behavior, inability to profit from experience, and a lack of capacity to form meaningful emotional relationships." In spite of appellant's record of suicidal attempts at Graterford, Dr. Heller was of the opinion that appellant did not present a significant suicide risk and recommended that he be placed in the prison population. Dr. Heller's second report on October 1, 1964, followed an apparent suicide attempt. At that time, he stated: "It would appear that this suicidal attempt was a superficial one, as was the original one he made *312 at Graterford . . .". At this time, Dr. Heller reiterated his previous evaluation of Howard and found him unable to respond to disciplinary relationship except for the briefest periods of time. On October 20, 1964, appellant was examined by Dr. C. Fred Hering, a psychiatrist, following an episode of bizarre behavior and a suicidal attempt on October 2, 1964, supposedly a severe reaction to the long sentence which had been imposed. Dr. Hering stated: "This man was admitted to 3 Block . . . following an episode of bizzarre [sic] behavior on 15 Block, where he had been sent following a suicidal attempt. . . . This seemed to be a very severe reaction to the fact that he had a 30 to 60 year sentence and feels he has nothing to lose. However, it was pointed out to him that he has a lot to gain with behavior which would be more productive and constructive for him; that there is an opportunity for him to learn many things, both about himself as well as vocationally and educationally, here in the institution. He seems somewhat impressed by this."
The instant killing occurred on November 12, 1965. However, appellant was not indicted until December of 1965, and early in January of 1966, he was brought to court for the appointment of public counsel or the opportunity to obtain private counsel. On January 17, 1966, he corresponded with the newly-created office of the Public Defender, requesting counsel, and counsel was formally appointed on February 1, 1966. On February 21, 1966, upon the application of the office of the public defender, Dr. Emil Trellis, a psychiatrist, and Dr. Leon I. Ford, a clinical psychologist, were appointed to examine appellant. On March 5, 1966, Dr. Ford examined the appellant for approximately 4 hours. This examination included testing and an interview with appellant at great length. Dr. Ford observed: ". . . He seems equally inclined to take direct action, often in an impulsive manner, to avoid or to *313 obtain release from tension. Most of the time he reacts on a reality basis, but he has the potential for sudden emotional eruptions on the basis of inner promptings with little regard for external reality. . . . When his defenses are lowered under great stress he can be overwhelmed by intense mixed moody and angry feelings and destructive impulses. . . .
"Psychological tests reveal Mr. Howard to be extremely immature and self-centered person who views the world as extremely hostile and unpleasant. He has many deep-seated fears and conflicts and an extremely low tolerance for frustration and anxiety. Passivity, fantasy, projection and counter-phobic defenses are insufficient to contain his anxiety, and he avoids and relieves tension by direct and often impulsive action. Assultive [sic] tendencies are easily elicited especially when he feels threatened. Generally, he is quite reality oriented, but he has occasional lapses when his thinking is illogical and disordered."
He concluded as follows: "The eneuresis (bed-wetting), anti-social behavior, impulsive assaultiveness towards self and others, and the psychological test results indicating emotional conflicts, illogical thinking and the potential for impulsive behavior with little regard for reality all suggest a borderline psychosis or transient psychotic episodes in an impulsive character disordered personality."
In his direct examination at trial, Dr. Ford described appellant as thinking concretely, meaning that he attempted to act to immediate things instead of stopping to think what the consequences of such acts might be. He indicated that Howard had inadequate counter-phobic defenses, indicating that appellant tended to become more aggressive to counteract his fears. The suggestion of transient psychotic episodes was supported by the effects upon appellant of his being isolated and the occasional lapses which occurred in the *314 process of psychological testing. Dr. Ford's testimony also revealed, in his opinion, it would have been better had appellant been tested soon after the crime, depending upon his condition, and that it would have been worth the attempt to try to determine appellant's state of mind at the time the offense was committed.
In direct examination, Dr. Ford defined "psychosis" as follows: "Psychosis, generally speaking, is a condition in which the person is emotionally disturbed. In other words, they don't react to things as other people do. They might see a situation differently than other people see a situation. . . . They might react in such a way that it is entirely unrealistic, . . ."
As to "transient psychotic episodes", Dr. Ford explained: "By this I mean that under great stress a person can go into one of these psychotic episodes. It doesn't mean that they are like this all the time. It would happen when they are under particular kinds of stress. . . . It can be inner stress. It could be external, it could be inner, it could be both."
Dr. Ford classified appellant as a sociopathic personality, defined as follows: "The sociopathic personality essentially is someone who from very early in life has had very few, if any, close personal relationships with people of longlasting nature, and as a result they tend to be very shallow, very superficial in the way they form friendships. They are really too immature socially and emotionally to really form friendships, real friendships, as most people do. They, of course, seem to be self-centered and primarily concerned with self-preservation and frequently may get into all sorts of difficulties with the law and with people in managing to survive as the only way they know how. They haven't been disciplined enough as children and really never developed a strong conscience, as the average person does who has more stable family relationships. Essentially, that's about it . . ."
*315 Dr. Ford went on to state that sociopaths do not normally adjust well to long periods of confinement, and that possibly long periods of confinement could lead to further anti-social acts. He stated that sociopathic personalities are mentally ill, and that in his opinion, Stanley Howard was mentally ill. When questioned as to his being treated for his illness, he replied: "That's a difficult question. People have been trying to treat sociopaths and people who are mentally ill like Stanley for many years, with some success and with some failures. I would say more failures than successes."
Dr. Emil Trellis first examined Stanley Howard on March 3, 1966, and again on April 1, 1966. His testimony revealed that he had studied the tests given to Howard by Dr. Ford, and after examining Howard's tests, diagnosed him as "emotionally unstable personality with schizoid features. . .". He quoted the definition of Emotionally Unstable Personality from the Diagnostic and Statistic Manual of the American Psychiatric Association as follows: "In such cases the individual reacts with excitability and ineffectiveness when confronted by minor stress. His judgment may be undependable under stress, and his relationship to other people is continuously fraught with fluctuating emotional attitudes, because of strong and poorly controlled hostility, guilt, and anxiety.
"This term is synonymous with the former term psychopathic personality with emotional instability."
He found that Howard showed hints of schizophrenic features, although Howard was not schizophrenic. He testified that the sociopathic person "tends to be impulsive; hence not to be able to have the judgment or control of impulses to delay immediate action with the idea that they have to have consequences for their behavior. The sociopath does not readily learn from experience. The sociopath in general isn't able *316 to have the controls to develop a sustained kind of occupational skill in many cases." Dr. Trellis also stated that, in his opinion, Howard was not legally insane.
We said in Commonwealth v. Green, 396 Pa. 137, 151 A. 2d 241 (1959): "Our scope of review is limited: we simply determine whether the court below in its imposition of the death penalty upon Green abused its discretion.
"In Com. v. Taranow, 359 Pa. 342, 344, 345, 59 A. 2d 53, this Court, speaking through Mr. Justice (now Chief Justice) JONES, stated: `The Act of 1939, supra, specifically provides that "In cases of pleas of guilty, the court, where it determines the crime to be murder of the first degree, shall, at its discretion, impose sentence of death or imprisonment for life". (Emphasis supplied). The extent of our function in the premises is merely to review for a possible abuse of the discretion so reposed in the trial court: Commonwealth v. Hough, 358 Pa. 247, 250, 56 A. 2d 84. "The point for consideration [on appeal] is not whether this Court would have imposed the death penalty but whether the discretion vested in the court below was judicially exercised,. . ." Commonwealth v. Howell, 338 Pa. 577, 580, 13 A. 2d 531.'"
As we said in Commonwealth v. Cater, 402 Pa. 48, 55, 166 A. 2d 44 (1960): "In determining whether the court below abused its discretion in the imposition of the death sentences we must bear in mind that while the discretion exercised by a trial court in the imposition of the death penalty, after a plea of guilty and a finding of murder in the first degree, is subject to our appellate review, yet on such review the question before us is not whether we would have imposed the same penalty under the circumstances but whether the trial court manifestly abused the discretion imposed upon it by the legislature: [citing cases]:"
*317 In the instant case, appellant contends that the evidence was insufficient to establish that this was a killing with premeditation and deliberation. We believe this contention to be without merit. The appellant entered a plea of guilty to murder generally, and after the three-judge court heard all the evidence, the crime was fixed at murder in the first degree, and appellant was sentenced to death. The Penal Code of 1939, Act of June 24, 1939, P.L. 872, § 701, 18 P.S. § 4701 provides: "Offenses Against the Person. Section 701. Murder of the First and Second Degree. All murder which shall be perpetrated by means of poison, or by lying in wait, or by any other kind of willful, deliberate and premeditated killing, . . . shall be murder in the first degree. All other kinds of murder shall be murder in the second degree."
We said, in Commonwealth v. Tyrrell, 405 Pa. 210, 212, 174 A. 2d 852 (1961): "The distinguishing criterion or hallmark of murder is legal malice, express or implied. Malice is an absolutely essential ingredient of murder. [citing cases] The essential difference in a nonfelony murder-killing between murder in the first degree and murder in the second degree is that murder in the first degree requires a specific intent to take the life of another human being: [citing cases]."
In Commonwealth v. Ballem, 386 Pa. 20, 26, 123 A. 2d 728 (1956), we said: "Indeed, the jury could have found a specific intent to kill and therefore first degree murder from `the offender's use of a deadly weapon, for while an intention to kill may be shown by the defendant's express words or declarations or other conduct, such intent may be just as effectively inferred from the deliberate use of a deadly weapon upon a vital part for a manifest purpose: [citing cases].'"
In the instant case, appellant's use of a deadly weapon and his acts, committed in the presence of others, were more than sufficient for the court to find *318 appellant guilty of murder in the first degree. The action of appellant supplies specific intent, willfulness, deliberation and premeditation essential for a determination of murder in the first degree. For example, in Commonwealth v. Millien, 291 Pa. 291, 295, 139 A. 851 (1927), it was held to be proper to admit evidence showing the number of shots fired by the defendant. As we said in Commonwealth v. Tyrrell, supra, "A criminal's intent, like the commission of a crime and the identity of the criminal, can be found by a jury or Judge from a consideration of the defendant's act, his words and his actions not only at the time of the commission of the crime but also, when relevant, prior and subsequent thereto in other words, from all relevant facts and circumstances and all reasonable inferences therefrom." In Commonwealth v. Carroll, 412 Pa. 525, 532, 194 A. 2d 911 (1963), this court, speaking through Mr. Chief Justice BELL, stated: "The specific intent to kill which is necessary to constitute in a nonfelony murder, murder in the first degree, may be found from a defendant's words or conduct or from the attendant circumstances together with all reasonable inferences therefrom, and may be inferred from the intentional use of a deadly weapon on a vital part of the body of another human being: [citing cases]."
In the instant case, where appellant made an unprovoked attack from the rear with a deadly weapon on a vital area of a prison guard; where he continued to strike at the unarmed guard with the weapon; and where he stabbed to death another unarmed man who was attempting to assist the guard, we find that the trial court was fully justified in making a finding of first degree murder.
Appellant further contends that the death penalty is not justified because of appellant's history, which has been set out previously, and particularly because an exhaustive inquiry was precluded by the failure of *319 the prison authorities to give appellant a mental examination immediately after the offense. Appellant further contends that this failure to give him a prompt medical examination was a denial of his constitutional right to the effective assistance of counsel, and prevented an effective inquiry into the defense of insanity. We find these contentions also to be without merit. We are aware that the psychiatrist and psychologist who testified on behalf of appellant both indicated it would have been desirable had appellant received an earlier mental examination; that is, shortly after the time the crime was committed. We are of the opinion that this would have been a desirable thing, and perhaps had the prison authorities had it to do over again, would have had such a mental examination conducted. However, we do not find that their failure to do so supports the contention as set forth by appellant. Nor do we find it mandatory that a defendant be given a mental examination on the spot. As we said in Commonwealth v. Melton, 406 Pa. 343, 356, 178 A. 2d 728 (1962): "The reports and opinions of psychiatrists and psychologists should be considered by the trial Court, together with all the other facts and evidence, but such reports and opinions are in no way controlling, and neither a jury nor a trial Court has to believe or give complete credence or any credence whatever to the opinion of the psychologists and of psychiatrists: [citing cases]."
Appellant's last contention is that the court's imposition of the death sentence was an abuse of discretion because the record disclosed appellant's mental illness at the time of the offense and for some time prior thereto, and that the imposition of this death sentence would constitute a cruel and unusual punishment in violation of the Federal and State Constitutions. We find this contention to be without merit. As we said in Commonwealth v. Smith, 405 Pa. 456, 459, *320 176 A. 2d 619 (1962): "This Court has sustained a verdict of first degree murder with penalty of death where defendant allegedly had an irresistible impulse, was a moron or a mental defective or a sexual pervert or a psychopathic personality, or had been previously confined in the hospital for the criminal insane for 14 years, or was a schizophrenic psychopath or was an unstable, mentally defective moron, or was feeble-minded: [citing cases]." We conclude, therefore, that appellant in the instant case received a fair hearing; that the evidence was more than sufficient for the court below to find appellant guilty of murder in the first degree. We further find the court below did properly and most thoroughly consider appellant's background, and that background, coupled with the testimony of both the psychiatrist and psychologist, was considered most properly by the court below in reaching its decision. We further find that under the scope of our review as has been previously set forth, the court below did not abuse its discretion in finding appellant guilty of murder in the first degree and in sentencing him to death.
Judgment affirmed.
Mr. Justice JONES concurs in the result.
DISSENTING OPINION BY MR. JUSTICE COHEN:
I dissent from the imposition of the death sentence and its affirmance by this Court. See my dissent in Commonwealth v. Ahearn, 421 Pa. 311, 218 A. 2d 561 (1966), and the opinion of Judge BREITEL of the New York Court of Appeals in People v. Moseley, 20 N.Y. 2d 64, 281 N.Y.S. 2d 762 (1967).
DISSENTING OPINION BY MR. JUSTICE ROBERTS:
I continue to adhere to the views expressed last year in my dissenting opinion in Commonwealth v. *321 Ahearn, 421 Pa. 311, 331, 218 A. 2d 561, 571 (1966),[1] and would, consistent with those views, vacate the instant judgment and remand so that the court below could consider the psychiatric testimony as it relates to the degree of guilt.[2]
In Ahearn, the majority opinion conceded that psychiatric testimony was both admissible and relevant for the purpose of determining penalty following a finding of murder in the first degree.[3] Thus, even if I were able to accept the rationale of Ahearn, I believe, in view of the psychiatric findings of both the majority of this Court and of the en banc court below, the imposition of the death penalty is improper in this case. Accordingly, I would exercise our authority under the Act of June 24, 1939, P.L. 872, § 701, 18 P.S. § 4701, *322 and instruct the court below to sentence Howard to life imprisonment. See Commonwealth v. Green, 396 Pa. 137, 144-46, 151 A. 2d 241, 245 (1959).
Appellant concedes that under the M'Naghten Rule, which is the current test for criminal responsibility in Pennsylvania, he is guilty of murder.[4] And given Ahearn, the court below properly found him guilty of murder in the first degree. But the M'Naghten Rule is totally irrelevant to the question of whether or not the death sentence ought to be imposed in a given case. Indeed by not holding that the imposition of the death penalty, despite the existence of a serious mental disease or defect, amounts to an abuse of discretion, we are ignoring the teachings of Commonwealth v. Green, supra at 148, 150, 151 A. 2d at 246-47, 248 (emphasis supplied): "No more awesome duty nor solemn obligation comes within the province of a judge than the decision whether penalty of death or life imprisonment shall be imposed upon a convicted first degree murderer. There is no rule that requires proof of mitigating or extenuating circumstances to reduce the penalty from death to that of life imprisonment. The imposition of the death penalty by a judicial tribunal should be made only when it is the sole penalty justified both by the criminal act and the criminal himself and then only after a full and exhaustive inquiry into both the criminal act and the criminal himself.
. . .
"An appropriate exercise of judicial discretion as required by the statute contemplates that the death penalty be imposed where all the facts surrounding the criminal act and the criminal actor have been exhaustively *323 considered and where, after such consideration, no other conclusion can be justified than the extermination of the convicted criminal by death. Determination of the appropriate penalty arrived at in any other manner constitutes an abuse of the judicial discretion."
The court below was aware of the Green principle but concluded that, in view of certain aggravating factors,[5] Howard's mental condition did not justify imposing a life sentence. Although the court below did not specifically refer to the M'Naghten test, it did seem to feel that it was bound by it on sentencing as well as in determining the degree of guilt, for it held that under Pennsylvania law "the mere presence of mental disease or defect, not amounting to such impairment that the murderer did not know the difference between right and wrong, will not prevent the finding of murder in the first degree or the imposition of the death penalty."[6] But as I have already stated M'Naghten is *324 a test for determining criminal responsibility, not the appropriate penalty.
I dissent.
NOTES
[1] Interestingly the majority opinion does not even cite Ahearn. Yet there can be no question that that decision, as both the appellant and appellee recognize, is crucial to the disposition of the instant case.
[2] A recent note in 71 Dick. L. Rev. 100 (1966) characterizes the Ahearn holding as having "disregarded modern enlightened authority and unwisely restricted the purpose for which psychiatric testimony may be admitted into evidence." Not only does this note, in my view, demonstrate the truth of its principal thesis but it also convincingly shows that Ahearn represents a new development in the law of Pennsylvania, for "while prior decisions have held that neither judge nor jury is to be controlled by psychiatric testimony, and that such testimony is to be accorded little weight, no prior Pennsylvania case has ever held that such testimony is inadmissible to show a lack of the elements necessary to establish murder in the first degree." Id. at 104.
I continue to believe that the most realistic rule devised to deal with this problem is that of The American Law Institute: "Evidence that the defendant suffered from a mental disease or defect is admissible whenever it is relevant to prove that the defendant did or did not have a state of mind which is an element of the offense." A.L.I. Model Penal Code, § 4.02(1) (Official Draft, 1962). See also People v. Gorshen, 51 Cal. 2d 716, 726-27, 336 P. 2d 492, 498-99 (1959).
[3] 421 Pa. at 325, 218 A. 2d at 568.
[4] In my view the entire area of criminal responsibility could benefit from a fresh review by the judiciary. See, e.g., United States v. Freeman, 357 F. 2d 606 (2d Cir. 1966) (adopting the A.L.I. Model Penal Code test of legal insanity). I believe this to be a step in the right direction.
[5] These aggravating factors were: (1) the murder was committed by a convict already serving a long prison sentence; (2) the defendant had previously been convicted of felonies involving the use of violence; (3) at the time the murder was committed the defendant also caused serious bodily injury to another person. At the same time, however, the court recognized Howard's serious mental incapacity prevented him from fully controlling his responses.
[6] The court below felt that the above conclusion was necessitated by certain language from Commonwealth v. Smith, 405 Pa. 456, 459, 176 A. 2d 619, 620 (1962), to wit: "This Court has sustained a verdict of first degree murder with penalty of death where defendant allegedly had an irresistible impulse, was a moron or a mental defective or a sexual pervert or a psychopathic personality, or had been previously confined in the hospital for the criminal insane for 14 years, or was a schizophrenic psychopath or was an unstable, mentally defective moron, or was feeble-minded. [Citations omitted]." Each case must be decided on its own facts and the mere existence of psychiatric evidence tending to show the existence of a mental disease or defect is not sufficient to preclude the imposition of the death penalty. Most, if not all, of the cases cited in the Smith opinion are distinguishable either because of the quantum of psychiatric testimony and/or because, as in Smith, a jury rather than a judge had determined the penalty. In the latter circumstances, this Court may not reverse the sentence for an abuse of discretion. See Commonwealth v. Taranow, 359 Pa. 342, 344-45, 59 A. 2d 53, 54 (1948). Nevertheless, in light of current medical knowledge, I cannot subscribe to the broad implications drawn by the court below from Smith's sweeping statement. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534552/ | 813 S.W.2d 141 (1991)
Christine FORD, Plaintiff-Appellant,
v.
Rayburn A. TRAUGHBER, Commissioner of the Tennessee Department of Employment Security, and the Veterans Administration Medical Center, Defendants-Appellees.
Court of Appeals of Tennessee, Middle Section.
March 13, 1991.
Application for Permission to Appeal Denied June 24, 1991.
*142 Russell J. Overby, Linda L. Narrow, Legal Services of Middle Tennessee, Inc., Nashville, for Christine Ford.
Charles W. Burson, Atty. Gen. & Reporter, Stuart F. Patton, Asst. Atty. Gen., Nashville, for Rayburn A. Traughber, Comm'r of Tennessee Dept. of Employment Sec.
Joe B. Brown, U.S. Atty., for M.D. Tennessee, Robert C. Watson, Asst. U.S. Atty., Nashville, for Veterans Admin.
Application for Permission to Appeal Denied by Supreme Court June 24, 1991.
OPINION
LEWIS, Judge.
Appellant Christine Ford applied to the Tennessee Department of Employment Security for unemployment compensation benefits. The Board of Review denied appellant's claim after finding that appellant "is not able and available for work under T.C.A. § 50-7-302(a)(4)." The trial court affirmed the decision of the Board of Review after determining that there was "substantial material evidence in the record to support the Board's decision."
On appeal, appellant contends that the Board of Review found, and the trial court affirmed, that appellant was not entitled to benefits solely because she was not able to return to her former employment as a nursing assistant. She insists that this is not the test but that she is entitled to benefits if she is "able to work, available for work and making a reasonable effort to secure work" that she is reasonably qualified to perform.
Appellant's employment with the Veterans Administration Medical Center (Medical Center) began in 1980. She was employed as a nursing assistant at the time her employment with the Medical Center was terminated on 30 November 1988.
Her job as a nursing assistant required her to care for patients. In her care of the patients, she was, among other things, required to bend, stoop and lift weights in excess of forty-five pounds.
At the hearing before the Appeals Tribunal, appellant testified that she became unable to perform her duties as a nursing assistant because of a back condition aggravated by her work. She testified that she could perform light duty work if it did not involve lifting over twenty-five pounds.
On cross-examination appellant testified that she was unable to do "day work" and that she had a doctor's statement to corroborate that she could not do "day work." She insists that "day work" required physical labor that aggravated her back condition. She did not offer the doctor's statement.
Prior to her termination and subsequent to her "back problems," the Medical Center placed appellant in a temporary position in its pharmacy service where her duties included packaging and wrapping medication to be mailed to patients.
*143 On or about 17 October 1988, the Medical Center submitted to appellant a notice of appellant's proposed separation for disability due to her inability to perform her job as a nursing assistant. On that same day appellant requested a permanent assignment to the pharmacy service.
On 16 November 1988, the Medical Center notified appellant she would be terminated effective 30 November 1988.
In January 1989, appellant applied to the Medical Center for the position of dental assistant.
The Medical Center rejected appellant's applications for pharmacy technician and dental assistant on the ground that appellant did not qualify for either position.
On her application for the position of pharmacy technician, it is noted: "Ms. Ford stated on her application that she would not accept a position below GS-4. This grade level requires six months specialized experience equivalent to the next lower grade. She does not possess this experience." The position of pharmacy technician also required appellant to do lifting of over forty-five pounds.
On the application for dental assistant, it is noted: "Ms. Ford stated on her application that she would not accept a position below GS-4. This grade level requires (GS-4) one year qualifying experience equivalent to the next lower grade. She does not possess this qualifying experience as stated on her application."
Prior to her termination, appellant was examined and treated by at least three doctors. Dr. Davis and Dr. Stanley Hobbs were private physicians selected by appellant. Dr. Watson was selected by the Medical Center to examine and treat appellant.
The record shows that Dr. Watson concluded in his report that Dr. Davis' reports were insufficient to support a causal connection between appellant's ongoing disability and her injury while at work on 20 August 1986. Dr. Watson also concluded that Dr. Davis' report admitted that there was no medical reason for placing appellant on light duty and that Dr. Davis did so because of appellant's subjective complaints of pain in her back.
Dr. Davis' note of 29 June 1987 stated in part: "I think I need to find out more about her, because she keeps staying off work and she had what I considered to be a fairly minor injury and I am having some difficulty finding enough physical evidence that she does have serious pain."
Subsequently, Dr. Davis recommended light duty for appellant. The light duty restrictions applied only to lifting and not to bending or stooping.
Because of the light duty restrictions, appellant was assigned on a temporary basis to the pharmacy. The pay scale for the job appellant was performing in the pharmacy was below that of nursing assistant. However, the Medical Center continued to pay appellant the same salary she received as a nursing assistant.
The Tennessee Employment Security Law was enacted for the purpose of alleviating the economic insecurity of an individual and his or her family due to unemployment and is for the benefit of those who are unemployed through no fault of their own. Tenn. Code Ann. § 50-7-102; Davis v. Aluminum Co. of Amer., 204 Tenn. 135, 316 S.W.2d 24 (1958). The statute is to receive a "liberal interpretation by the courts." Weaver v. Wallace, 565 S.W.2d 867, 869 (Tenn. 1978).
The standard of judicial review applicable in unemployment compensation benefit cases where the trial court sits as an appellate court is set forth in Tennessee Code Annotated Section 50-7-304(i)(3):
In determining the substantiality of evidence, the chancellor shall take into account whatever in the record fairly detracts from its weight, but he shall not substitute his judgment for that of the board of review as to the weight of the evidence on questions of fact. No decision of the board of review shall be reversed, remanded, or modified by the chancellor unless for errors which affect the merits of the final decision of the board of review.
*144 If there is substantial evidence to support the decision of the Board of Review, the Board's decision is conclusive, and the trial court's review shall be confined to questions of law. Perryman v. Bible, 653 S.W.2d 424, 429 (Tenn. App. 1983). This Court must apply the same standard as the trial court in reviewing the trial court's decision in an unemployment compensation case. See Armstrong v. Neel, 725 S.W.2d 953, 955 (Tenn. App. 1986).
Substantial evidence is "such relevant evidence as a reasonable mind might accept to support a rational conclusion and such as to furnish a reasonably sound basis for the action under consideration." Southern Ry. Co. v. State Bd. of Equalization, 682 S.W.2d 196, 199 (Tenn. 1984) (citations omitted). Courts should not disturb a reasonable decision of any agency which has expertise, experience and knowledge in a particular field. Id.
Tennessee Code Annotated Section 50-7-302(a)(4) provides in pertinent part as follows:
An unemployed claimant shall be eligible to receive benefits with respect to any week only if the commissioner finds that all of the following conditions are met:
(4) He is able to work, available for work, and making a reasonable effort to secure work. In determining whether the claimant is making a reasonable effort to secure work, the commissioner shall consider the customary methods of obtaining work in the claimant's usual occupation or any occupation for which he is reasonably qualified, the current condition of the labor market, and any attachment the claimant may have to a regular job.
The Tennessee Supreme Court, in Reese v. Hake, 184 Tenn. 423, 199 S.W.2d 569 (1947), held:
[A] claimant must be able to accept suitable employment if offered as a condition necessary to become eligible for unemployment compensation, and the burden of establishing a claimant's right to benefits under the Unemployment Compensation Law rests on claimant and a finding by an unemployment compensation commission that a claimant was not eligible for benefits on the ground that such claimant was not available need not be supported by affirmative, substantial evidence tending to show that she was not available for work, since the burden is on the claimant to make a prima facie case.
Id. at 427, 199 S.W.2d at 570 (citations omitted). The burden here was on appellant to show that she was able and available for work.
A person who quits a job is disqualified from receiving benefits unless there is good cause connected to the work. Thach v. Scott, 219 Tenn. 390, 397, 410 S.W.2d 173, 176 (1966). Only a disability or illness that is directly attributable to the job is sufficient good cause. Cawthron v. Scott, 217 Tenn. 668, 670, 400 S.W.2d 240, 242 (1966). In the present case plaintiff did not voluntarily quit her job. She was discharged by her employer. Therefore, the causal connection between plaintiff's injury and her job is irrelevant.
For the plaintiff to be eligible for benefits, she does not have to show that she is able to perform and available to perform the duties of her former employment, but she must show that she is "able to work and available for work" for employment for which she is reasonably qualified.
Where a claimant was unable to do his former work because he could not stand for long hours on a concrete floor but was qualified for work and had applied for other work, he was able and available for work. Department of Indus. Relations v. Chapman, 37 Ala.App. 680, 74 So. 2d 621 (1954). See also Harris v. Woodcrest Mobile Homes, 359 So. 2d 243 (La. Ct. App. 1978); Miles v. Review Bd. of Indiana Employment Sec. Div., 120 Ind. App. 685, 96 N.E.2d 128 (1951).
The Board of Review adopted the decision of the Appeals Tribunal. The Appeals Tribunal set forth its finding and concluded as follows: "The medical proof shows no causal connection between plaintiff's injury and her job. Claimant has restricted her *145 availability to work because of the medical restrictions. The Appeals Tribunal finds the evidence to show claimant is not able and available for work under T.C.A. § 50-7-302(a)(4)."
Plaintiff insists that implicit in the findings and conclusions is that plaintiff is not entitled to benefits solely because she is not physically ably to return to her last employment.
We respectfully disagree. The Board, and the Chancellor in affirming the Board, simply held that plaintiff was not able or available for work.
It is without question that plaintiff is not physically able to perform the work of her last employment. The question is: Does the record show that plaintiff has carried her burden of showing that she is "able to work, available for work and making a reasonable effort to secure work," Tenn. Code Ann. § 50-7-302(4), at a job that she is reasonably qualified to perform.
Following our review of this record we are of the opinion that the plaintiff has failed to carry her burden. She has placed salary restrictions and restrictions upon her physical ability to work far greater than the actual medical restrictions.
Dr. Davis gave plaintiff a light duty slip based on her subjective complaints of back pain. He stated in his 4 January 1988 report:
[Plaintiff] has a major back problem which I cannot prove. She says she has a lot of pain and she wants to stay on light duty. In giving her a light duty slip, however, I have no basic reason to give her this light duty slip except that she says she hurts.
Dr. Hobbs, who imposed the restriction that plaintiff not lift more than twenty to twenty-five pounds, in his 6 October 1988 report to the Medical Center stated in part: "Her back condition would probably make it difficult for her to do heavy lifting, such as lifting a patient from the bed into a chair, although she may be able to do this... . She certainly may attempt to work without risking any specific damage as such to her spine."
Plaintiff claimed at the Appeals Tribunal hearing that she was unable to do bending or stooping. However, none of the doctors who treated or examined her imposed any such restrictions.
Plaintiff, after filing her initial claim, admitted that she was qualified to do "day work" but stated she would never do such work again. She contended she has a doctor's statement showing she was physically unable to do day work. However, she never produced such a statement.
The initial agency decision found that she was qualified but unwilling to do "day work."
Plaintiff applied for two positions with the Medical Center. Her application for employment as a pharmacy technician was denied. On that application it is noted that she did not possess the necessary experience as a pharmacy technician. The record also shows that the pharmacy technician position requires heavy lifting of over forty-five pounds. On her application for dental assistant, it was also noted that she did not possess the "qualifying experience as stated on her application." The record shows that the position of dental assistant requires long periods of bending, standing and walking and also requires the dental assistant to help patients in and out of the dental chair.
Plaintiff also placed salary restrictions upon her acceptance of either the pharmacy technician or the dental assistant position. She would not accept a position level less than GS-4.[1]
Plaintiff argues that she demonstrated her ability to work in the Medical Center Pharmacy since she worked there for a period of six months. She was temporarily assigned to the Medical Center Pharmacy. However, during that period of time, she was paid the pay scale for a nursing assistant. This pay scale was in excess of that for the position in the pharmacy. She had stated that she would not accept a position less than GS-4. The position for which she was qualified in the pharmacy was less than a GS-4.
*146 Plaintiff also contends that she has applied for jobs with a number of other employers. However, no evidence of these applications are properly before the Court. There is no evidence in the record that the job search form was ever entered into evidence or that it was considered by the Appeals Tribunal or the Board of Review.
However, even if we considered the job search form, it would be of little help to the appellant. This form does not disclose what positions were sought by the appellant. The form also does not indicate whether these positions involve lifting weights which are inconsistent with the restrictions imposed by the appellant's physicians.
The plaintiff was properly denied benefits on the basis that she was not able and available for work. She voluntarily imposed restrictions upon her availability for work. She imposed medical restrictions which were beyond those restrictions set by her doctors, and she also imposed financial restrictions. She voluntarily chose to limit her availability for work.
The judgment of the Chancery Court affirming the Board of Review's decision is affirmed with the cause remanded to the Chancery Court for the collection of costs, which are assessed to plaintiff, and for any further necessary proceedings.
TODD, P.J., and KOCH, JJ., concur.
NOTES
[1] GS-4 corresponds to the rate at which employees are compensated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534563/ | 813 S.W.2d 643 (1991)
Michael Anthony BECK d/b/a Metro Auto Brokerage & Referral Services, Appellant,
v.
Henry PALACIOS & Elizabeth Palacios, Individually and as Husband and Wife, Appellees.
No. B14-90-869-CV.
Court of Appeals of Texas, Houston (14th Dist.).
July 11, 1991.
*644 Mack J. Travers, David C. Klosterboer, Houston, for appellant.
Daniel C. Graney, Houston, for appellees.
Before PAUL PRESSLER, JUNELL and ELLIS, JJ.
OPINION
PAUL PRESSLER, Justice.
A default judgment was granted in a deceptive trade practices action. A motion for new trial was overruled by operation of law. Appellant brings four points of error. We affirm.
Appellees brought suit for deceptive trade practices, breach of warranty, breach of contract and common law misrepresentation against appellants, MFC Finance Company of Texas and Champion Ford, Inc. MFC Finance Company of Texas Inc. and Champion Ford, Inc. were dismissed after settling with the appellees. Appellant was served notice of the claim by letter sent certified mail, dated December 6,1989. He was also served with citation and copy of appellees' original petition under the name of "Tony Beck d/b/a Metro Auto Brokerage & Referral Services" on February 17, 1990. Upon learning that appellant's true and correct name was "Michael Anthony Beck", appellees amended their petition to correct the name. Appellant was served with the amended petition on March 6. Appellant failed to respond to appellees' demand letter and failed to answer either appellees' original or amended petitions.
On April 27, the trial judge signed an interlocutory default judgment which was accompanied by a Certificate of Last Known Mailing Address. On May 31, after a hearing on damages, a final default judgment was entered against appellant. There is no record of the May 31, 1990 hearing presented on appeal. On June 29, appellant filed his motion for new trial supported by his affidavit in which he alleged that his failure to file an answer was due to his mistaken impression that service of the amended petition acted to dismiss him from the lawsuit. Appellant further alleged that he had been "negotiating" with appellees' attorney, and was under the impression that the parties had all settled their differences. Appellees' response denies that there were settlement negotiations with appellant. The motion for new trial was heard on July 11. No order was signed and no findings of fact and conclusions of law were made. Appellant's motion was overruled by operation of law on August 14.
In his first, second and third points of error, appellant alleges that the trial court abused its discretion in denying his motion for new trial. Appellant argues that this motion met all of the requirements in Craddock v. Sunshine Buslines, Inc., 134 Tex. 388, 133 S.W.2d 124 (Tex.Comm.'n App.1939). He also argues that appellees offered no competent evidence to controvert the facts alleged in his motion and affidavit. Appellant's contentions are without merit.
*645 The standard for granting a motion for new trial and setting aside a default judgment was established ago by the Texas Supreme Court in Craddock, supra. Craddock requires that the defendant must demonstrate that: (1) his failure to answer was not intentional or the result of conscious indifference, but rather due to an accident or mistake; (2) the motion for new trial sets up a meritorious defense; and (3) the motion must show that the granting of a new trial will cause no delay or injury to the plaintiff. 134 Tex. at 393, 133 S.W.2d at 126.
The granting or denial of a motion for new trial is within the sound discretion of the trial court, and such discretion will not be disturbed on appeal absent a showing of abuse. Strackbein v. Prewitt, 671 S.W.2d 37, 38 (Tex. 1984). While trial courts have discretion, they are also governed by equitable principles. They are not granted unbridled discretion to decide cases as they choose without reference to any guiding rule or principle. Craddock, 133 S.W.2d at 126.
The first Craddock requirement is applied liberally and each case depends on its own facts. Gotcher v. Barnett, 757 S.W.2d 398, 401 (Tex.App.Houston [14th Dist.] 1988, no writ). Negligence alone will not preclude the setting aside of a default judgment. Absent a record of an evidentiary hearing, only appellant's motion and affidavit and appellees response thereto will be considered in determining whether the first requirement was met. Strackbein, 671 S.W.2d at 38; Ward v. Nava, 488 S.W.2d 736, 737 (Tex.1972).
Conscious indifference is a failure to take some action which would seem indicated to a person of reasonable sensibility under the same or similar circumstances. Johnson v. Edmonds, 712 S.W.2d 651, 653 (Tex.App.Fort Worth 1986, no writ). In Johnson, the defendant failed to answer because he allegedly did not understand the nature of the citation served upon him, and he simply read the "papers" and filed them. Id. The Johnson court held that such an act amounted to conscious indifference. Id. at 653. In First Nat'l Bank v. Peterson, 709 S.W.2d 276 (Tex.App Houston [14th Dist.] 1986, writ ref'd n.r.e.), this court held that the defendant bank's failure to take any action after receiving a writ of garnishment was either intentional or the result of conscious indifference. In State Farm Life Ins. Co v. Mosharaf 794 S.W.2d 578 (Tex.App.Houston [1st Dist.] 1990, writ denied), the First Court of Appeals distinguished those cases where the defaulting defendant took some form of action that resulted in accidental loss or misplacement of the papers which had been served from those cases where the defendant took no action whatsoever after service. The court cited a line of cases where mistakes virtually identical to those of the defendant in Mosharaf, all resulting in a failure to answer, have repeatedly been excused under Craddock as not being the result of conscious indifference or of bad faith. Id. at 582. The Mosharaf court distinguished Johnson and Peterson from the facts before it because "[b]oth cases, Johnson and Peterson involved inaction by the defendant after service, and are distinguishable from cases where a defendant took actions that resulted in accidental loss or misplacement of suit papers after service." Id. at 583.
Here, appellant alleges in his affidavit the following excuses for failing to file an answer:
Based upon my conversations with the process server, I was of the opinion that because the petition had been amended I was no longer a party. Therefore, I did not forward the papers to my attorney, nor did I answer in my own behalf. Furthermore, I had been negotiating with Daniel C. Graney, attorney for the plaintiffs, and was under the impression that the parties to the lawsuit had settled their differences.
This amounts to an admission that he took no action whatsoever after service because of his "opinion" or "impression" that the suit had been dismissed against him, and he was not required to file an answer. Appellant was served with citation on two occasions and also notified of the interlocutory default judgment. The trial court did *646 not abuse its discretion in determining that the failure of the defendant to file an answer was the result of conscious indifference or intentional disregard. See Sunrizon Homes, Inc. v. Fuller, 747 S.W.2d 530, 533 (Tex.App.San Antonio 1988, writ denied).
Appellant argues that he established a meritorious defense. His motion must allege facts which would constitute a defense in law and must be supported by affidavits or other evidences showing prima facie proof that the defendant has a meritorious defense. Ivy v. Carrell, 407 S.W.2d 212, 214 (Tex.1966); Siegler v. Williams, 658 S.W.2d 236, 239 (Tex.App Houston [1st Dist] 1983, no writ).
Appellant's alleged meritorious defenses are the "breach of condition precedent, acts or omissions of third parties together with the plaintiffs' inability to qualify for financing together with certain defenses to eliminate or least mitigate the damages claimed by the plaintiffs." No facts are alleged to support there alleged defenses. Mere allegations of legal conclusions are insufficient to raise a meritorious defense. Boulware v. Security State Bank, 598 S.W.2d 687, 689 (Tex.Civ.App.Houston [14th Dist.] 1980, writ ref'd n.r.e.). Where the defendant has failed to allege facts supporting an element of its meritorious defense, the motion for new trial may be overruled. See The Moving Co. v. Whitten, 717 S.W.2d 117, 120 (Tex.App.Houston [14th Dist.] 1986, writ ref'd n.r.e.).
The trial court did not abuse its discretion. Appellant's first, second and third points are overruled.
In his fourth point of error, appellant alleges that the trial court erred in denying appellant's motion for new trial because there was insufficient evidence to prove the damages awarded. Appellant offers no argument or authority in support of this point of error. Additionally, appellant failed to request and file a statement of facts timely. Therefore, there is no record of the default judgment proceeding in which damages were proved. Without a record there is nothing to review. A.T. Lowry Toyota, Inc. v. Peters, 727 S.W.2d 307 (Tex.App.Houston [1st Dist] 1987, no writ). Appellant's fourth point of error is overruled.
Accordingly, the judgment of the trial court is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534594/ | 813 S.W.2d 801 (1991)
Jerry SARGENT, Appellant,
v.
COMMONWEALTH of Kentucky, Appellee.
Donald SARGENT, Appellant,
v.
COMMONWEALTH of Kentucky, Appellee.
Nos. 89-SC-321-MR, 89-SC-322-MR.
Supreme Court of Kentucky.
April 11, 1991.
Rehearing Denied September 26, 1991.
Linda K. West, Asst. Public Advocate, Dept. of Public Advocacy, Frankfort, for appellants.
Frederic J. Cowan, Atty. Gen., Carol C. Ullerich, Asst. Atty. Gen., Criminal Appellate Div., Frankfort, for appellee.
WINTERSHEIMER, Justice.
These consolidated appeals are from Jerry Sargent's conviction of trafficking in marijuana, first-degree wanton endangerment and first-degree persistent felony offender and his sentence of 20 years on each charge to run consecutively, and from Donald Sargent's conviction of trafficking in marijuana, possession of marijuana, possession of a Schedule IV controlled substance and as a first-degree persistent felony offender. He was sentenced to 20 years in prison, 90 days in jail and one year in jail to run concurrently.
The questions presented are whether two police officers could testify as to their opinion that the Sargents possessed the marijuana with intent to sell and not for personal use; whether Donald Sargent waived any alleged noncompliance with the discovery order, and whether a mention of "mug shots" warranted a mistrial.
In the course of executing a search warrant at an address occupied by appellants' *802 mother, police discovered a plastic bottle containing plant materials, two suitcases and a cooler which also contained plant material. As the police were leaving the address, an automobile drove into the parking lot and one of the officers recognized the driver as Jerry Sargent. The vehicle immediately left at a high rate of speed with police in pursuit, attaining speeds in excess of 100 miles an hour. The chase continued for more than 30 minutes until the fleeing vehicle spun around and landed in a creekbed. As the Sargents exited the wrecked automobile they were arrested. The police removed five plastic garbage bags from the trunk of the car, all containing plant material. Upon trial, the Sargents were convicted and this appeal followed.
At trial, two police officers testified as qualified experts that it was their opinion that the nearly 15 pounds of marijuana seized were for sale and not for personal use.
The trial judge did not commit error in allowing the police to testify as to their expert opinion that the Sargents had the drugs in their possession for sale and not personal use. The testimony of the two detectives was admissible as that of expert witnesses. Kroth v. Commonwealth, Ky., 737 S.W.2d 680 (1987); Kentucky Power Company v. Kilbourn, Ky., 307 S.W.2d 9 (1957). The police testimony indicates that their opinion was based on experience derived from many drug related investigations. Detective West had eight years with the Dry Ridge police department and six years with the Kentucky State Police and had been involved in several narcotic investigations. His familiarity with controlled substances arose from a combination of work experience and training. Detective Harrison had served with the state police for nine years and had worked in narcotics exclusively for nine months prior to trial. He was also knowledgeable about controlled substances and narcotics.
Both detectives testified about the marijuana trade which is certainly specialized in character and outside the scope of common knowledge and experience of most jurors. The opinion of the police aided the jury in understanding the evidence and resolving the issues. The trial judge did not abuse his discretion when he determined that both police officers were sufficiently qualified to give expert testimony. There was no invasion of the province of the jury as the ultimate factfinder and there was no error.
The police were skilled in a particular field and stated facts from which an opinion could be drawn. Coots v. Commonwealth, 295 Ky. 637, 175 S.W.2d 139 (1943). Both detectives referred to the large quantity of marijuana and the unique packaging as a basis for the belief that the marijuana was possessed for sale rather than for personal use.
Another issue on appeal raised by only Donald Sargent is that the trial judge should have excluded the laboratory reports of the marijuana because the prosecutor allegedly did not follow the discovery order mandating that the results be shared between counsel. Jerry Sargent does not join in this argument because he did not file a motion for discovery and his attorney acknowledged seeing the entire file of the prosecution. The announcement by Donald Sargent of "ready" waived any alleged noncompliance with the discovery order of the trial court. Barclay v. Commonwealth, Ky., 499 S.W.2d 283 (1973). Following a lengthy discussion, the trial judge overruled the motion to suppress, finding that the Commonwealth had substantially complied with the discovery order and that Donald Sargent had suffered no prejudice because he did not move for independent testing of the marijuana.
The final issue involves mug shots. A brief mention of mug shots during the two-day trial did not require a mistrial and did not amount to reversible error. The jurors were promptly and properly admonished to disregard a single comment. Considering the entire case and the overwhelming evidence of guilt, there is no substantial possibility that the result would have been any different. Abernathy v. Commonwealth, Ky., 439 S.W.2d 949 (1969); *803 Buchanan v. Commonwealth, Ky., 691 S.W.2d 210 (1985); RCr 9.24.
The judgments of conviction are affirmed.
LAMBERT, REYNOLDS and SPAIN, JJ., concur.
COMBS, J., dissents by separate opinion in which STEPHENS, C.J., and LEIBSON, J., join.
COMBS, Justice, dissenting.
Believing that these defendants were not afforded a fair trial, I respectfully dissent.
1. Police officers, however experienced in the investigation of concrete facts, are not qualified to express a testimonial opinion as to a defendant's mental state. Ordinarily, and certainly in this case, the jury is fully competent to determine from the objective evidence alone whether the facts prove culpable intent. In the event that expertise is required on this issue, it must be provided by a competent, neutral psychologist or psychiatrist, not by an investigating officer. Here, the so-called expert opinions were nothing more than bootstrap conclusions based merely upon the officers' own likely-biased opinions about previous cases; they simply beg the question.
Consider a criminal homicide case in which the mental state of the defendant is a prominent issue. According to the majority's rationale, a police detective (or perhaps a private detective? or an experienced amateur?) would be permitted to testify not only as to his/her factual observations, but also that in his/her opinion the defendant acted intentionally, as opposed to wantonly, recklessly or innocently. And upon what would this opinion be founded? Upon the detective's opinion that other defendants in similar cases had acted intentionally.
Such testimony constitutes an egregious usurpation of the function of the jury. Rather than perpetuating the flawed holding in Kroth v. Commonwealth, Ky., 737 S.W.2d 680 (1987), we ought today to seize the opportunity to overrule it.
2. Well in advance of trial, on Donald Sargent's discovery motion, the court ordered the Commonwealth to provide results of any scientific tests or experiments conducted in connection with the case. At trial, the prosecution was allowed, over objection, to enter the testimony of a crime lab chemist, and laboratory reports which had never been furnished to the defendant.
I cannot agree that the defendant waived objection to the Commonwealth's flagrant violation of the court order, or waived his right to a fair trial. In announcing ready, the defense was perfectly justified in believing that the Commonwealth had complied with the express order of the court, and that there was no undisclosed scientific evidence.
3. During the Commonwealth's direct examination of a police officer, there occurred the following:
Q. How is it that you knew Jerry Sargent? Did you know the man?
A. Yes, sir, I had known him. I had not had any previous contact with Jerry Sargent. However, he had been pointed out to me by other officers and detectives with the state police and so forth and through mug shots.
Evidence which in any manner shows or tends to show that a defendant has committed another offense independent of that for which he is on trial is inadmissible. Russell v. Commonwealth, Ky., 482 S.W.2d 584, 588 (1972). In this case, the testimony concerning the mug shots (and that concerning the other officers and detectives) was not introduced pursuant to any exception to the rule of exclusion. The witness' prior knowledge of the defendant was irrelevant. The sole purpose of the quoted testimony was gratuitously to indicate to the jury that Jerry Sargent was a person with a criminal background. Considering the pattern of prejudice revealed by this record, I am not prepared to say that the court's admonition to the jury was sufficient to cure the error.
Now that we have permitted the state to partially invade and usurp the jury's function of determining guilt or innocence, where will we go next? Is the ancient mode of trial by jury in jeopardy? That *804 was to be held sacred and inviolate by virtue of Section 7 of our constitution.
The trial of this case was marred by three clear and substantial errors. If not each independently, then certainly all in accumulation demonstrate that these defendants did not receive a fundamentally fair trial.
STEPHENS, C.J., and LEIBSON, J., join in this dissenting opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534893/ | 5 B.R. 822 (1980)
In re PARADISE BOAT LEASING CORP., Debtor.
BAMERICAL MORTGAGE & FINANCE COMPANY, INC., Plaintiff,
v.
PARADISE BOAT LEASING CORP., Defendant.
Bankruptcy No. 79-00007.
District Court, Virgin Islands, D. St. Thomas and St. John.
July 21, 1980.
*823 Frederick D. Rosenberg, Charlotte Amalie, St. Thomas, V.I., for plaintiff.
Arnold M. Selke, Charlotte Amalie, St. Thomas, V.I., for defendant.
OPINION
CHRISTIAN, Chief Judge.
This matter is an appeal from an Order of the Bankruptcy Court granting secured creditor Bamerical Mortgage & Finance Company, Inc.'s application for relief from the automatic stay imposed under 11 U.S.C.A. § 362(a). Bamerical seeks to enforce its lien against the yacht Solo, a vessel owned and operated by appellant-debtor Paradise Boat Leasing Corp. At issue is the Bankruptcy Court's determination that regardless of Paradise's substantial equity in the collateral, the mobility and risk inherent in the operations of a seagoing vessel signify that Bamerical's interest cannot be adequately protected and that, therefore, it is entitled to relief from the stay pursuant to 11 U.S.C.A. § 362(d)(1). In light of the circumstances and equities of the case at bar, the Court will find that Bamerical's interest might be adequately protected without resort to termination of the automatic stay. Accordingly, the case will be remanded to the Bankruptcy Court for reconsideration.
The Bankruptcy Court made the following findings of fact. On August 6, 1976 Paradise executed a promissory note for $161,400[1] in favor of Bamerical in exchange for a loan utilized to purchase the yacht "Solo". On September 15, 1978 Paradise executed a chattel mortgage encumbering the "Solo" as security for repayment of the loan. Bamerical has a valid lien and apparently the chattel mortgage was filed in Puerto Rico. Paradise has used the vessel for both charter and pleasure-sailing in the Caribbean.
After Paradise defaulted on the loan, Bamerical commenced an in rem proceeding against the "Solo" in St. Thomas. Paradise then filed this reorganization proceeding under Chapter 11 of Title 11 of the United States Code. The reorganization petition shows that the only asset of Paradise is the "Solo". It also shows that the balance due on the loan is approximately $70,000. and that the remaining claims, chiefly for marina charges, are about $3,000.
Certain additional facts are readily inferable from the Bankruptcy Court's Opinion. Firstly, the Bankruptcy Court raises little objection to Paradise's reorganization plan except the lack of adequate protection for *824 Bamerical. Thus, if this obstacle can be overcome, the plan is probably acceptable.[2] Secondly, Paradise has a substantial equity in the "Solo".[3] Finally, it is the vessel's characteristics of mobility, and vulnerability to the perils of the sea that underly the Bankruptcy Court's finding of the absence of adequate protection. Accordingly, it is the essentials of adequate protection that the Court must define.
The Court's analysis begins with the applicable statute, 11 U.S.C.A. § 362(d):
(d) On request of a party in interest and after notice and a hearing, the court shall grant relief from the stay provided under subsection (a) of this section, such as by terminating, annulling, modifying, or conditioning such stay
(1) for cause, including the lack of adequate protection of an interest in property of such party in interest; or
(2) with respect to a stay of an act against property, if
(A) the debtor does not have an equity in such property; and
(B) such property is not necessary to an effective reorganization.
Three conclusions follow immediately from a reading of § 362(d). Firstly subsection (d)(2) cannot apply in the case at bar because Paradise has equity in the vessel. Secondly, because (d)(2) explicitly conditions its applicability on the debtor's lack of equity in the collateral while (d)(1) makes no such demand, Bamerical may obtain relief under (d)(1) despite Paradise's equity in the "Solo". Thus, the Court must reject Paradise's argument that its equity in the yacht precludes the granting of any relief to Bamerical under § 362(d). Finally, the Court concludes that the Bankruptcy Court's decision was not limited to a choice between terminating or continuing the automatic stay. Instead, the court may grant relief "such as by terminating, annulling, modifying, or conditioning such stay . . ." 11 U.S.C.A. § 362(d).
As to the question of what constitutes adequate protection, § 361 provides the best definition available:
§ 361. Adequate protection
When adequate protection is required under section 362, 363, or 364 of this title of an interest of an entity in property, such adequate protection may be provided by
(1) requiring the trustee to make periodic case payments to such entity, to the extent that the stay under section 362 of this title, use, sale, or lease under section 363 of this title, or any grant of a lien under section 364 of this title results in a decrease in the value of such entity's interest in such 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 such entity's interest in such property; or
(3) granting such other relief, other than entitling such entity to compensation allowable under section 503(b)(1) of this title as an administrative expense, as will result in the realization by such entity of the indubitable equivalent of such entity's interest in such property.
Yet, section 361 cites examples of adequate protection rather than provide an exhaustive listing. 2 Collier on Bankruptcy ¶ 362.07 at 362-47 (15th ed. 1979). Thus, ample room is given in § 361 for case by case development of the appropriate standards. Id. at 362-46. We start from scratch since this development is still in its infancy.
At the outset, it is clear that only subsection (3) is relevant to our analysis. In effect, subsections (1) and (2) cannot apply to the "Solo" because they presume *825 that the debtor lacks equity in the collateral.[4] Unfortunately, the Bankruptcy Court misinterprets subsection (3). It reads subsection (3) as suggesting only that adequate protection may be achieved by providing for "(p)ossible compensation to the creditor by way of a claim for administration expenses." Instead, as stated in the notes of the Committee on the Judiciary, House Report No. 95-595, U.S.Code Cong. & Admin. News 1978, pp. 5787, 6296, the provision has a much broader meaning:
The fourth method gives the parties and the courts flexibility by allowing such other relief as will result in the realization by the protected entity of the value of its interest in the property involved. Under this provision, the courts will be able to adapt to new methods of financing and to formulate protection that is appropriate to the circumstances of the case if none of the other methods would accomplish the desired result. For example, another form of adequate protection might be the guarantee by a third party outside the judicial process of compensation for any loss incurred in the case. Adequate protection might also, in some circumstances, be provided by permitting a secured creditor to bid in his claim at the sale of the property and to offset the claim against the price bid in.
The paragraph also defines, more clearly than the others, the general concept of adequate protection, by requiring such relief as will result in the realization of value. It is the general category, and as such, is defined by the concept involved rather than any particular method of adequate protection.
Thus, as a court of equity the Bankruptcy Court is free to balance the hardships to the affected parties and fashion relief accordingly. See 2 Collier on Bankruptcy at 362-47.
Hence, the Bankruptcy Court's error in interpreting § 361(3) renders its termination of the stay suspect. The matter must be remanded to the Bankruptcy Court to calculate whether less drastic relief may be fashioned in line with the options available under § 362(d). In that regard, the Bankruptcy Court should consider whether adequate protection to Bamerical might be achieved by conditioning the stay on Paradise acquiring sufficient insurance on the craft. Because the Chattel Mortgage provides Bamerical with the power to mandate the acquisition of such insurance by Paradise, this alternative appears particularly attractive.
In addition, the Bankruptcy Court must evaluate the effect of the alleged prohibition on Paradise removing the "Solo" from Puerto Rico on the potential for adequate protection. Preliminarily, however, the Bankruptcy Court should verify whether the parties ever agreed to such a limitation. The Chattel Mortgage contains no such agreement and there is no other indication of it in the record or exhibits. Some evidentiary basis must exist before the Bankruptcy Court can make such a finding.
Lastly, some mention of the Bankruptcy Court's discussion of the term "indubitable equivalent" in § 361(3) is warranted. Without expressing a view on the particular facts at issue, the Court simply notes that the statute demands the "mere indubitable equivalent rather than the most indubitable equivalence. . . ." 1 Collier on Bankruptcy at 361-10. Thus, "where the creditor is in the business of extending credit a moratorium in debt service if accompanied by measures to preserve the collateral may suffice." Id. at 362-47.
NOTES
[1] $119,377.00 principal and $42,023.00 in interest.
[2] The Bankruptcy Court does question the prospects for rehabilitation and reorganization of paradise. The thrust of the Bankruptcy Court's decision, however, is that the rehabilitation question should not be reached because of the lack of adequate protection.
[3] The reorganization petition lists the market value of the Solo as $200,000. Also, the principal of the original loan in 1976 was $119,377.00 of which about half has been repaid.
[4] This presumption is significant, however, because it suggests that a debtor with equity in the disputed collateral has a very strong argument that its creditor is provided with adequate protection. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534909/ | 95 N.J. Super. 491 (1967)
231 A.2d 835
STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
JOSEPH DRIESSE, DEFENDANT-APPELLANT.
Superior Court of New Jersey, Appellate Division.
Argued May 29, 1967.
Decided June 22, 1967.
*492 Before Judges CONFORD, FOLEY and LEONARD.
Mr. Richard P. Marcus, assigned counsel, argued the cause for appellant.
Mr. Archibald Kreiger, Assistant Prosecutor, argued the cause for respondent. (Mr. John G. Thevos, Passaic County Prosecutor, attorney).
The opinion of the court was delivered by LEONARD, J.A.D.
Defendant appeals as an indigent by leave of this court from a judgment of conviction for violation of probation and contempt of court after a hearing before the County Court.
On December 14, 1961 defendant was tried and convicted of desertion, nonsupport and neglect of two minor children. N.J.S. 2A:100-2. He received a six-month suspended sentence and was placed upon probation for two years. He was also ordered to pay $25 per week for the support of the two children and was released on posting surety of $1,000.
Defendant was charged with violation of probation and a hearing on that charge was held on January 14, 1966. At that time the record indicated that he had made no support payments since June 2, 1964 and had not reported to the probation department since July 29, 1963. It was also established that he had fathered five illegitimate children, all of whom he was supporting under different court orders. The record indicated that at least one or more of these children was conceived after defendant was placed upon probation.
*493 Defendant was found guilty of violation of probation because he had committed adultery during the probationary period, and he was also held in contempt of court for failing to make the support payments. He was sentenced to 1 1/2-2 1/2 years in State Prison.
On this appeal defendant does not challenge the finding of guilt but only the propriety of his sentence. He contends that under the provisions of N.J.S. 2A:100-5 the court was without authority to impose a sentence for violation of probation which was greater in severity than the original sentence which had been suspended when he was first placed upon probation.
N.J.S. 2A:100-4 provides that upon conviction for desertion or nonsupport of a wife or children in destitute or necessitous circumstances, N.J.S. 2A:100-2, the court, instead of imposing the penalty provided for the conviction, may make an order directing defendant to pay a certain sum periodically for the support of the wife or children. The court also may release defendant from custody on probation upon a recognizance conditioned upon his appearance in court whenever ordered to do so and upon his compliance with the terms of the order.
N.J.S. 2A:100-5 reads in its pertinent part:
"If the court be satisfied by information and due proof under oath that the defendant has violated the terms of the order, it may forthwith proceed with the trial of the defendant under the original charge, or sentence the defendant under the original conviction or plea of guilty, or enforce the suspended sentence or punish for contempt, as the case may be." (Emphasis added)
Under the terms of the above noted statute, if it be established that the defendant "has violated the terms of the order" the court may only "enforce the suspended sentence" originally imposed. This would prohibit the imposition of a longer sentence.
On the other hand, N.J.S. 2A:168-4 provides that upon conviction for violation of probation the court "may continue *494 or revoke * * * the suspension of sentence, and may cause the sentence imposed to be executed or impose any sentence which might originally have been imposed." (Emphasis added). In the case of In re White, 18 N.J. 449 (1955), the court held that under this statute a court could impose a sentence of two to three years in State Prison after conviction for probation violation, even though the original sentence which had been suspended imposed only a term of one year in the county penitentiary. See also State v. Zachowski, 53 N.J. Super. 431, 437 (App. Div. 1959).
Query, if an individual under similar circumstances as defendant was found guilty of a violation of probation only because he violated the terms of the support order, which of the two seemingly conflicting statutes, N.J.S. 2A:100-5 and N.J.S. 2A:168-4 would prevail? However since defendant here not only failed to comply with the support order but also violated his probation (by committing adultery), we do not have to resolve this conflict. Under the instant circumstances we conclude that N.J.S. 2A:168-4 controls. Thus the court could properly impose "any sentence which might originally have been imposed," even though longer than the original one.
The crime of which defendant was originally convicted, N.J.S. 2A:100-2, was a misdemeanor and hence punishable by imprisonment for not more than three years. N.J.S. 2A:85-7. We do not find the sentence imposed 1 1/2 to 2 1/2 years to be "manifestly excessive." State v. Johnson, 67 N.J. Super. 414, 432 (App. Div. 1961).
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534568/ | 813 S.W.2d 132 (1991)
Barnett VAUGHN, Plaintiff-Appellee,
v.
SHELBY WILLIAMS OF TENNESSEE, INC., Defendant-Appellant.
Supreme Court of Tennessee, at Knoxville.
June 24, 1991.
William R. Seale, Mark C. Travis, Morristown, for appellant.
James M. Davis, Morristown, for appellee.
OPINION
DROWOTA, Justice.
In this workers' compensation action, the employer, Shelby Williams of Tennessee, Inc., Defendant-Appellant, has appealed from a judgment of the Circuit Court of Hamblen County awarding the employee, Barnett Vaughn, Plaintiff-Appellee, 80 percent permanent partial disability to the body as a whole as a result of a compensable back injury that occurred on September 12, 1988. The trial court also awarded temporary total disability benefits from the date of the Plaintiff's back surgery, May 8, 1989, to May 23, 1990, the day of the trial, in addition to a 25 percent bad faith penalty pursuant to the provisions of T.C.A. § 50-6-225(k).[1] Although five issues have been raised for our consideration, the question dispositive of this appeal is whether the *133 Defendant is entitled to a new trial in view of the fact that the trial court based its decision, at least in part, on personal observations of the Plaintiff prior to trial, separate and apart from any judicial proceedings. For the reasons set forth below, we reverse and remand for a new trial.
The Plaintiff, age 48 at the time of trial with an eighth grade education, injured his back while in the course and scope of his employment as a plywood bender on September 12, 1988. He was diagnosed as having sprained his spine. While continuing to work, he was treated by two physicians for back pain throughout 1988, and eventually sought treatment from Dr. Norwood, a neurosurgeon, in April, 1989. Surgery was performed on May 8, 1989, to remove a ruptured disc and some bone spurs. Dr. Norwood assessed an impairment rating of 25 percent and urged the Plaintiff to seek vocational rehabilitation because he could not return to his previous employment, which involved repetitive bending and lifting. The Plaintiff's work history consisted primarily of unskilled manual labor.
When the case was tried on May 23, 1990, the trial judge awarded 80 percent permanent partial disability to the body as a whole plus temporary total disability benefits. In its memorandum opinion, the court stated: "As to this particular defendant, the court had an opportunity to observe him on one occasion about a week before the trial, on another occasion at the Morristown Mall, and at another time in the parking lot, and, of course, during the trial. You can't always tell how disabled a person is by just observing him; anyway, this man looks and walks a little better than death warmed over." The court's award was based upon the medical and vocational proof and "general observations of the Plaintiff." This appeal followed.
As stated, the dispositive question in this case is whether it was error for the court to base its decision on facts not contained in the record, but acquired by the court's extrajudicial observations of the Plaintiff. The trial judge saw the Plaintiff on three separate occasions prior to trial and based his decision, in part, on what was observed. We hold that this constitutes reversible error.
There is ample authority for the proposition that a judge is not to use from the bench, under the guise of judicial knowledge, that which he knows only as an individual observer outside of the judicial proceedings. 9 Wigmore, Evidence, § 2569 at 723 (1981). Judicial knowledge upon which a decision may be based is not the personal knowledge of the judge, but the cognizance of certain facts the judge becomes aware of by virtue of the legal procedures in which he plays a neutral role. State v. Henderson, 221 Tenn. 24, 424 S.W.2d 186, 188 (1968). No judge is at liberty to take into account personal knowledge which he possesses when deciding upon an issue submitted by the parties.[2]Laurance v. Laurance, 198 Or. 630, 258 P.2d 784, 787 (1953). In other words, "[i]t matters not what is known to the judge personally if it is not known to him in his official capacity." Galbreath v. Nolan, 58 Tenn. App. 260, 429 S.W.2d 447, 450 (1967).
Significantly, a judge is not permitted to make an investigation of a case, even an inadvertent one, off of the record, and then base a holding on the information obtained incident thereto. See State v. Suttles, 767 S.W.2d 403, 407 (Tenn. 1989); Caldwell v. State, 164 Tenn. 325, 48 S.W.2d 1087, 1097 (1932); see also Moore v. Russell, 294 F. Supp. 615, 620-21 (E.D.Tenn. 1968) ("Whatever may have been the personal observations and individual views of the judge as a person, these factors have no place whatever in his exercise of judicial *134 discretion."). Moreover, when a judge becomes a source of evidence, appellate courts are put in an awkward position in that the character of the evidence obtained through private inquiry or observation, as well as its probative value, is not shown in the record, making an evaluation of the information on appeal difficult, if not impossible.
Other than difficulties associated with appellate review, actions such as those taken by the trial judge in the present case create problems for the parties which can and should be avoided. Simply stated, by observing a party outside of the judicial proceedings, and then basing a decision on those observations, the judge becomes a source of evidence, in effect, a witness. Rule 605 of the Tennessee Rules of Evidence[3] clearly prohibits a judge presiding over a trial from serving as a witness, and for good reason. Perhaps the most obvious one is that the system of justice does not appear to be impartial if the judge charged with the duty of adjudicating the litigation also acts as a source of evidence. See generally, Cohen, Tennessee Law of Evidence, § 605.1 at 247 (2d ed. 1990). Additionally, when the trial judge becomes a source of information, the parties may not be willing to cross-examine vigorously the judge whose goodwill is perceived to be important to the outcome of the case. Worse yet, the parties may not even get the opportunity to cross-examine the judge to begin with. The present case is a prime example. It seems appropriate that when the trial judge becomes a source of information, and when a decision is ultimately influenced by that information, the parties should have the opportunity to cross-examine in order to impeach the source of the evidence or otherwise persuade an impartial trier of fact that the court's observations are, for whatever reason, inaccurate, just as they would any other witness.
Finally, at no point prior to or during the trial did the trial court advise either counsel that he had previously observed the Plaintiff on three occasions separate and apart from any judicial proceeding. The court's memorandum opinion constituted the first notice to the Defendant that the trier of fact had personal knowledge regarding the Plaintiff. The parties were denied the opportunity to cross-examine the judge or offer rebuttal proof to the judge's "testimony" that he had seen the Plaintiff on three prior occasions and that the Plaintiff "looks and walks a little better than death warmed over." Without the opportunity to cross-examine, the Defendant was unable to verify the judge's identification of the Plaintiff as the person he saw at the mall and in the parking lot. In essence, the trial court's personal knowledge regarding the Plaintiff's physical condition which, consequently, was a hotly contested issue, and its apparent influence on his decision, made him a witness for the Plaintiff in contravention of the principles alluded to above. Although the trial court was no doubt unaware of the impropriety of his actions, we reiterate that a judge may not formulate a decision based upon information obtained outside the course of the judicial proceedings before him, even though the judge may not have intended to learn of the facts pertinent to the case. In the instant case, the trial court's personal observations played a significant role in the exercise of judicial discretion in arriving at an award of benefits. In doing so, the court committed reversible error.
For the foregoing reasons, the judgment of the trial court is vacated in its entirety and the matter is remanded for a new trial with instructions that a different judge preside over the proceedings.[4] Costs of this *135 appeal shall be split evenly between the parties.
REID, C.J., and O'BRIEN, DAUGHTREY and ANDERSON, JJ.
NOTES
[1] T.C.A. § 50-6-225(k) provides: "If an employer wrongfully fails to pay an employee's claim for temporary total disability payments, the employer shall be liable, in the discretion of the court, to pay the employee, in addition to the amount due for temporary total disability payments, a sum not exceeding twenty-five percent (25%) or such temporary total disability claim, provided that it is made to appear to the court that the refusal to pay such a claim was not in good faith and that such failure to pay inflicted additional expense, loss or injury upon the employee and provided further, that such additional liability shall be measured by the additional expense thus entailed."
[2] Judicial notice may, however, be taken of adjudicative facts provided those facts are not subject to reasonable dispute and, even then, only under limited circumstances. Rule 201, Tennessee Rules of Evidence. This case does not involve judicial notice of facts per se. Rather, this matter involves a trier of fact, who, in effect, became a source of facts or evidence. It is not appropriate to judicially notice facts that are beyond the scope of the knowledge of the general public, but are known instead to the judge through his personal, extrajudicial, experience. Cohen, Tennessee Law of Evidence, § 201.3 at 35 (2d ed. 1990).
[3] "The judge or chancellor presiding at the trial may not testify in that trial. No objection need be made in order to preserve the point." Rule 605, Tennessee Rules of Evidence.
[4] Canon 3(C)(1) of the Code of Judicial Conduct, which has been adopted as Rule 10 of the Supreme Court Rules, provides that "[a] judge should disqualify himself in a proceeding in which his partiality might reasonably be questioned, including ... instances where: (a) [h]e has personal ... knowledge of disputed evidentiary facts concerning the proceedings."
We think it also necessary upon remand to direct the parties' attention to Bond v. American Air Filter, 692 S.W.2d 638, 641-42 (Tenn. 1985), with respect to the questionable practice of awarding temporary total benefits up until the date of trial. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534626/ | 95 N.J. Super. 338 (1967)
231 A.2d 229
SYLVIA LEVINE AND LOUIS LEVINE, PLAINTIFFS-APPELLANTS,
v.
VINCENT SCAGLIONE, DEFENDANT-RESPONDENT.
Superior Court of New Jersey, Appellate Division.
Argued May 29, 1967.
Decided June 19, 1967.
*339 Before Judges SULLIVAN, KOLOVSKY and CARTON.
Mr. Jack Solomon argued the cause for appellants.
Mr. Edward E. Kuebler argued the cause for respondent.
The opinion of the court was delivered by KOLOVSKY, J.A.D.
In this automobile negligence-pedestrian knock-down case, plaintiffs appeal from a judgment for *340 defendant entered after a jury trial and from the trial court's denial of their motion for a new trial.
Plaintiffs urge three grounds for reversal. The most significant is the claim that the verdict was against the weight of the evidence and that the trial court erred in denying the motion for a new trial.
The only verdict returned by the jury was that "the defendant [was] not guilty of negligence." Our consideration is therefore limited to that finding. Kulbacki v. Sobchinsky, 38 N.J. 435, 452 (1962). We may not consider whether a general verdict of no cause for action would be immune from attack because of other issues in the case, including that of contributory negligence. There was no general verdict; the jurors ceased their deliberations, as the court's charge had expressly directed them to do, once they had decided that defendant was not negligent.
Applying the rationale of Kulbacki, supra, 38 N.J., at pp. 446-452, we have reviewed and considered the record and the trial court's reasons for denying a new trial. We conclude that under the proofs in this case, there was no reasonable justification for a finding that defendant was not negligent and that there has been "a manifest denial of justice under the law" mandating a new trial.
Mrs. Levine testified that she was standing south of the center line of Prince Street when she was struck. That testimony is confirmed by the other relevant evidence in the case, the testimony of the policeman who measured the distances from the southerly side of Prince Street to Mrs. Levine's body, and the admissions made by defendant in his testimony and in his answers to interrogatories. From that evidence it appears that defendant's westbound automobile was over the center line of Prince Street when, as defendant says, "the side of [its] left front fender" came in contact with Mrs. Levine.
Defendant testified that he was driving in a westerly direction on Prince Street intending to make a left turn into Morris Avenue. Morris Avenue runs in a southwesterly direction, *341 beginning at a point in Prince Street a short distance west of the point of impact. Defendant did not see Mrs. Levine at any time before the accident; the first time he saw her she was "sliding to the street at a point immediately next to the left side of my car near the windshield."
Defendant described what happened as follows:
"I was going along keeping to my right and then all of a sudden the reflection of the sun hit my eyes and I was blinded momentarily. After I regained my vision, I heard a noise and I applied my brakes and I stopped as I looked out I see Mrs. Levine laying on the floor."
By his own testimony defendant, when blinded by the sun, did nothing either by way of applying his brakes or lowering his sun visor. He continued driving until he regained his vision and heard the noise of impact; then for the first time he applied his brakes.
Defendant's conduct was incompatible with the jury's finding that he was not negligent. "No man is entitled to operate an automobile through a public street blindfolded." Hammond v. Morrison, 90 N.J.L. 15, 16 (Sup. Ct. 1917). The exercise of reasonable care requires that a driver in the predicament in which defendant found himself take action immediately to restore his vision, and if that requires that he slow down or come to a stop, that he do so instead of proceeding onward as if nothing untoward had happened. Hammond v. Morrison, supra; Osbun v. De Young, 99 N.J.L. 204, 208 (E. & A. 1923); State v. Kellow, 136 N.J.L. 1, 5 (Sup. Ct. 1947); Barth v. Reichert, 34 Ill. App.2d 472, 181 N.E.2d 609 (App. Ct. 1962); Annotation, "Automobiles Blinding Lights," 22 A.L.R.2d 292, 408 (1952).
Indeed, defendant's admitted familiarity with Prince Street, which he travelled twice a day to and from work, should have impelled him some distance before he reached the scene of the accident to lower his sun visor to shade his eyes against the setting sun which faced him as he proceeded in a westerly direction.
The suggestion by the trial judge in his ruling denying the motion for a new trial that the jury could have determined *342 that defendant did not have "time to stop after he was blinded" finds no support in the record. More meaningful is defendant's admission that he made no effort to stop or slow down and kept on driving although blinded.
It may be noted that the court's charge merely defined negligence generally. Plaintiff did not request a charge as to the duty of a driver temporarily blinded by the sun, and the charge as given made no reference thereto.
We treat next the other two grounds of appeal argued by plaintiffs since the same questions will undoubtedly arise at the new trial. The court did not err in submitting the issue of contributory negligence to the jury. Under the proofs in this case
"Fair-minded men of ordinary prudence might well differ * * * as to whether plaintiff acted as an ordinarily prudent man would act. It follows that the issue of contributory negligence was not one of law for determination by the court but rather one of fact for determination by the jury." Kopec v. Kakowski, 34 N.J. 243, 247 (1961).
The final ground of appeal relates to the admission of testimony describing defendant's unsuccessful efforts to obtain a physical examination of plaintiff prior to the institution of suit.
Although the accident took place on April 3, 1962, the complaint herein was not filed until almost two years later, on March 12, 1964. Plaintiff had, however, consulted Mr. Solomon, her present attorney, within days after the accident.
Mr. Barber, an investigator for defendant's insurance carrier, testified that he telephoned Mr. Solomon's office on April 23, 1962 and then spoke to Mr. Solomon on May 4, 1962 and requested a physical examination of plaintiff. According to Barber, Mr. Solomon said "that he would arrange in the future some date, a medical examination of his client." Barber detailed his unsuccessful efforts to obtain the physical examination, including a conversation of September 7, 1962 in which Mr. Solomon said he would have his client see defendant's examining physician, Dr. Butenas, and conversations on January 21, February 4, June 10, September 10 and *343 December 20, 1963, in which Barber repeated his requests that Mrs. Levine be examined by Dr. Butenas. A similar conversation took place early in May 1964, shortly after suit had been started. The record discloses that plaintiff was examined by defendant's doctors before trial, by Dr. Butenas on February 9, 1965, and by Dr. Flicker on April 13, 1966.
That the court rules provide a mechanism for obtaining an order for such a physical examination only after suit is instituted see R.R. 4:25-1 is irrelevant to the issue presented.
In our opinion, evidence indicating that a plaintiff seeking to recover for injuries involved in an accident had refused, without justifiable cause, to submit to a physical examination is admissible. A jury may infer that such refusal indicates that plaintiff has something to hide, a consciousness of the weakness of his cause. 29 Am. Jur.2d, Evidence, §§ 294, 625 (1967); 2 Wigmore, Evidence (3d ed. 1940), § 277, p. 119; § 289, p. 174; Annotation, "Evidence Refusal of Inspection," 175 A.L.R. 234 (1948); Austin & N.W.R. Co. v. Cluck, 97 Tex. 172, 77 S.W. 403, 408, 64 L.R.A. 494 (Sup. Ct. 1903); Stack v. New York, N.H. & H.R. Co., 177 Mass. 155, 58 N.E. 686, 687 (Sup. Jud. Ct. 1900).
In Austin & N.W.R. Co. the Supreme Court of Texas, while ruling that it had no power to order plaintiff to submit to a physical examination, said:
"The reason for refusing a physical examination of the plaintiff is not that the defendant is not entitled to have the benefit of the evidence, but because the court has no power to force the plaintiff to submit to such an examination. He has a right to submit or refuse, but, in case he should refuse, the defendant is entitled to have that fact go to the jury to be considered by them in determining upon the credibility and sufficiency of the testimony upon which he seeks to recover. Railroad Co. v. Botsford, 141 U.S. 255, 11 Sup. Ct. 1000, 35 L. Ed. 734. If the jury should believe that the refusal showed a purpose to conceal the truth, they might take the fact into account in weighing the evidence. If a satisfactory reason should be given for the refusal, and other evidence were sufficient, the refusal would not defeat a recovery." (77 S.W., at p. 408)
Here, defendant's unsuccessful attempts to obtain a physical examination extended over a period of almost two years *344 a period during which, plaintiff claimed at the trial, she was suffering continuously from the effects of the accident. The court did not err in admitting Barber's testimony.
Nor does it matter that, according to plaintiff, she was never advised of the requests made to her attorney that she submit to a physical examination. She had chosen the attorney to present the claim for her. She was chargeable with notice of the requests made of him. See O'Neil v. Bilotta, 18 N.J. Super. 82, 86 (App. Div. 1952), affirmed o.b. 10 N.J. 308 (1952); but cf. Texas & N.O. Ry. Co. v. Rooks, 292 S.W. 536 (Tex. Com. App. 1927).
The judgment is reversed and the cause remanded for a new trial. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2857808/ | cedar park
IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-91-139-CV
DONALD, WILLA AND DONNA O'CONNOR,
APPELLANTS
vs.
CITY OF CEDAR PARK,
APPELLEE
FROM THE DISTRICT COURT OF WILLIAMSON COUNTY, 277TH JUDICIAL DISTRICT
NO. 89-149-C, HONORABLE JOHN R. CARTER, JUDGE PRESIDING
Appellants Donald O'Connor, Willa O'Connor, and Donna O'Connor (the
O'Connors), sued appellee, City of Cedar Park (Cedar Park), for compensation for flood damage
to their property caused by a partially constructed drainage ditch. They appeal a district court
summary judgment, in favor of Cedar Park, ordering that the O'Connors take nothing, dismissing
the suit, and ordering the O'Connors to pay costs. We will affirm the summary judgment in part
and reverse and remand in part.
BACKGROUND
In 1985, Cedar Park gave Thornton-Bolding Partnership permission to build the
Park Place III development near the O'Connors' properties. These properties were in the 100-year flood plain and, according to the record, experienced severe flooding during rainfalls
beginning in the 1970s. Thornton-Bolding Partnership included in the development plans a
drainage ditch to alleviate the flooding. During the construction of the ditch, a gas line was found
running across the projected path of the ditch at a point right behind the O'Connors' properties.
The construction was halted immediately in order to confer with Lone Star Gas Company, the
owners of the pipeline. The incomplete drainage ditch created a dam which caused additional
flooding on the O'Connors' properties during the next heavy rainfall. Flooding continued to
occur until a subsequent owner of the project completed the ditch. Since that time, the O'Connors
concede that they have experienced no further problems.
The O'Connors sued Cedar Park under a constitutional-taking theory (inverse
condemnation), a water-code theory, and a common-law negligence theory. Cedar Park filed a
motion for summary judgment asserting that no issues of material fact existed and that the
summary judgment evidence established, as a matter of law, that plaintiffs could not prevail on
at least one essential element of each of their three causes of action. The O'Connors' response
claimed generally that factual and legal issues precluded summary judgment and specifically
addressed two fact issues and two legal issues in regard to the constitutional-taking claim. The
trial court granted the motion for summary judgment without specifying its grounds, allowing this
Court to affirm if any one of the grounds in the motion is meritorious. Rogers v. Ricane Enters,
Inc., 772 S.W.2d 76, 79 (Tex. 1989).
STANDARD OF REVIEW
A trial court should grant a motion for summary judgment only if the movant
establishes by competent summary judgment evidence that no genuine issue of material fact exists
to be decided and that the movant is therefore entitled to judgment as a matter of law. Nixon v.
Mr. Property Management Co., 690 S.W.2d 548 (Tex. 1985). Movant has the burden of proof,
and all reasonable doubts and inferences must be resolved in favor of the nonmovant. Wilcox v.
Saint Mary's Univ., 531 S.W.2d 589, 593 (Tex. 1976). A defendant who moves for summary
judgment is required to prove that, as a matter of law, the plaintiff has no cause of action, i.e. no
genuine issue of material fact exists as to one or more of the essential elements of the plaintiff's
cause of action. Citizens First Nat'l Bank v. Cinco Exploration Co., 540 S.W.2d 292, 294 (Tex.
1976). Where the trial court's order does not give a specific reason for granting the judgment,
the nonmovant, on appeal, must show why each ground asserted in the motion is insufficient to
support the order. Rogers, 772 S.W.2d at 79; McCrea v. Cubilla Condominium Corp., 685
S.W.2d 755, 757 (Tex. App. 1985, writ ref'd n.r.e.).
DISCUSSION
1. Inverse Condemnation
The O'Connors' first claim is based upon an inverse-condemnation theory which
requires taking, damage, or destruction of property for a public use. See Tex. Const. art. I, § 17.
Cedar Park argues that where the damage is caused exclusively by the alleged negligence of the
governmental unit, there is no inverse condemnation cause of action. We agree. A taking under
the Texas Constitution must be intentional. See Steele v. City of Houston, 603 S.W.2d 786, 790-91 (Tex. 1980); City of Abilene v. Smithwick, 721 S.W.2d 949, 951 (Tex. App. 1986, writ ref'd
n.r.e.). Further, the taking or damaging of the property must be for a public use. Smithwick, 721
S.W.2d at 952. In this case, the injury was the result of unforeseen circumstances delaying the
completion of the ditch. Although the ditch, as completed, might have contributed to a public use,
the uncompleted ditch and subsequent flood were not part of the public use. See Texas Highway
Dept. v. Weber, 219 S.W.2d 70 (Tex. 1949); Abbott v. City of Kaufman, 717 S.W.2d 927, 932
(Tex. App. 1986, writ dism'd). Since the O'Connors did not allege that the completed project,
as planned, caused the flooding but instead alleged, under their pleadings, that the negligence of
Cedar Park in failing to properly supervise the construction of the project caused the flooding, this
action sounds in negligence and cannot constitute the basis of an inverse condemnation action.
Point of error one is overruled.
2. Water Code
In point of error two the O'Connors claim that the trial court erred in granting
summary judgment because the evidence failed to disprove that Cedar Park impounded or diverted
surface waters in a manner that damaged the O'Connors' property by its overflow in violation of
law. (1) Cedar Park's motion for summary judgment asserted that the statute itself includes an
exception for municipalities engaged in flood control. It was the court's function to determine if
the exception applied to Cedar Park.
The record contains uncontroverted evidence that Lobo Street flooded frequently
and that the proper remedy was a ditch behind the O'Connors' properties. Further,
uncontroverted evidence established that once the ditch was completed, the flooding stopped. The
statutory exception applies to construction of improvements to control flooding, and canals for
irrigation or other purposes authorized by the code. Id. at § 11.086(c). Although there is no case
law under this section, we believe the language itself clearly exempts the construction of a
drainage ditch to prevent flooding from the proscriptive section of the Code.
It is true that Cedar Park, as a municipality, falls within the purview of the first
subsection. See Abbott v. City of Princeton, 721 S.W.2d 872, 875-76 (Tex. App. 1986, writ ref'd
n.r.e.) (the codification of the water control statutes requires the application of code construction
rules, under which a municipality is included in the definition of "person"). However, inclusion
of Cedar Park under the prohibitory section does not preclude application of a statutory exception
where the uncontroverted facts support application as they do in this case. The uncontroverted
summary judgment evidence demonstrated that Cedar Park approved the drainage ditch plans for
purposes of flood control and, therefore, was exempt under subsection (c) from the prohibitions
of subsection (a) of section 11.086 of the Water Code. The second point of error is overruled.
3. Common Law Negligence
The O'Connors' third amended petition included a common-law negligence claim
against Cedar Park, on the grounds that Cedar Park contributed to or negligently delayed the
completion of the drainage ditch. Further, they specifically asserted as a cause of their damages
that Cedar Park negligently (1) failed to oversee properly the installation of the ditch; (2) failed
to investigate the effects of the ditch on its citizens; and (3) failed to take prompt action to resolve
the problems accrued and occurring after construction of the ditch was abandoned.
The motion for summary judgment filed by Cedar Park also urged that
governmental immunity applied and that the facts of this case did not fit the exceptions provided
by the Tort Claims Act. See Tex. Civ. Prac. & Rem. Code Ann. § 101.021(A) (1976). (2)
Summary judgment was proper only if Cedar Park established by uncontroverted evidence that
the O'Connors could not prevail on an essential element of their claim.
In order to recover for property damage against a municipality acting in its
governmental capacity, the Tort Claims Act requires a plaintiff to prove that the property damage
arose from the operation or use of a motor-driven vehicle or motor-driven equipment. Tex. Civ.
Prac. & Rem. Code Ann. § 101.021(1)(A) (1986). In this case the uncontroverted evidence
established that no motor-driven vehicle or equipment caused the O'Connors' alleged property
damage. Therefore, the Tort Claims Act does not waive Cedar Park's immunity from liability
for the O'Connors' property damage.
The O'Connors also assert personal injuries in the nature of emotional distress
resulting from the flooding in question. In its motion for summary judgment, Cedar Park asserts
that, as a matter of law, the alleged injuries were not caused by a "use" or "condition" of tangible
real property as the Tort Claims Act requires. Tex. Civ. Prac. & Rem. Code Ann. § 101.021(2)
(1976).
The O'Connors urge that a genuine issue of material fact exists on their common-law negligence claim for personal injuries which precludes the district court from granting
summary judgment. We agree. In his oral deposition, a part of the summary judgment proof,
Donald O'Connor testified that Cedar Park was well aware of the presence of the gas line before
construction started and had even negotiated with Lone Star Gas regarding the cost of relocating
the line. O'Connor testified that the City Engineer took an active supervisory role in the
construction of the ditch. Finally, O'Connor testified that the City of Cedar Park "had made the
decision to stop [the] digging" when the gas line was discovered and was primarily responsible
for the delay in completing the construction of the ditch.
The O'Connors' personal injury claim is premised on section 101.021(2) of the
Tort Claims Act, which section waives a governmental unit's immunity from liability from a claim
for, "personal injury and death so caused by a condition or use of tangible personal or real
property if the governmental unit would, were it a private person, be liable to the claimant
according to Texas law." In order for the O'Connors to recover for injury caused by the "use"
of city property, they must show either negligence by an employee of Cedar Park responsible for
the use of the property, see State v. Tennison, 509 S.W.2d 560, 562 (Tex. 1974), or that the real
property being used was under the control of the unit of government or one of its employees at
the time of the injury causing event. See City of Denton v. Van Page, 701 S.W.2d 831, 835 (Tex.
1986); Payne v. City of Galveston, 772 S.W.2d 473 (Tex. App. 1989, writ denied).
Here, the direct testimony of Donald O'Connor creates a fact dispute regarding the
involvement of Cedar Park in the supervision and ultimate delay of the construction project. This
issue must be resolved by the trier of fact and is not appropriately resolved by summary judgment.
We overrule the O'Connors' third point of error as to their property claim and sustain it as to their
personal injury claim.
CONCLUSION
We reverse the final summary judgment of the district court only as to the common-law negligence claim for personal injury damages and remand that portion of the cause to the
district court for further proceedings. We affirm the summary judgment as to all other claims.
Mack Kidd, Justice
[Before Chief Justice Carroll, Justices Jones and Kidd]
Affirmed in Part; Reversed and Remanded in Part
Filed: June 24, 1992
[Do Not Publish]
1. The Water Code prohibits diversion or impoundment of "the natural flow of surface
waters in this state . . . in a manner that damages the property of another by the overflow
of the water diverted or impounded." See Tex. Water Code Ann. § 11.086(a) (1986).
However, subsection (c) creates an exception for "the construction and maintenance of levees
and other improvements to control floods, overflows, and freshets in rivers, creeks, and
streams or the construction of canals for conveying water for irrigation or other purposes
authorized by this code." Tex. Water Code Ann. § 11.086(c) (1986) (emphasis added).
2. Construction of a drainage ditch is a governmental function. See Tex. Civ. Prac. &
Rem. Code Ann. § 101.0215(9) (Supp. 1992). Where a city is engaged in a governmental
function, the doctrine of governmental immunity applies. Gates v. City of Dallas, 704 S.W.2d
737, 739 (Tex. 1986); City of Galveston v. Posnainsky, 62 Tex. 118, 125, 127 (1884). | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/2857769/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-92-083-CR
DAVID ALAN LINVILLE,
APPELLANT
vs.
THE STATE OF TEXAS,
APPELLEE
FROM THE DISTRICT COURT OF BELL COUNTY, 264TH JUDICIAL DISTRICT
NO. 40,794, HONORABLE JACK W. PRESCOTT, JUDGE PRESIDING
Appellant was tried under an indictment charging him with the offense of attempted
murder. See Tex. Penal Code Ann. § 15.01 (Supp. 1992). After a jury found him guilty of the
lesser included offense of aggravated assault, Tex. Penal Code Ann. § 22.02 (1989), the court
assessed his punishment, enhanced by a prior felony conviction, at fifteen years confinement. In
a single point of error, appellant asserts the trial court erred in admitting, over his objection, the
details of his prior conviction for the felony offense of driving while intoxicated. We overrule
appellant's point of error and affirm the judgment of the trial court.
An evaluation of appellant's point of error requires a review of the evidence.
Appellant and Lily Jones had been living with Leonard Sanders in his home in Killeen for about
five weeks prior to the time in question. When Sanders returned home during the late night hours
of September 7, 1991, he found his house in a "mess," a chair, "radio and whatnot" were broken.
Upon finding Jones on a couch, Sanders related that he saw something "I ain't ever seen before.
She was beat up severely . . . she just freaked me out when she picked up her head." Appellant
was on another couch asleep, with a rolled up chain, weighing "a couple of pounds" underneath
his hand.
Jones testified that she and appellant had been drinking and arguing prior to the
altercation, a course of conduct that had occurred on other occasions during their relationship.
Appellant had a "violent" temper when he was drunk. Jones related that appellant hit her in the
face with his fist "about 15, 20 times," threw her to the floor, kicked her in the ribs, pulled her
by the hair and threw her through the air into a chair. When appellant stopped the attack to get
another drink, Jones attempted to exit the house. Before she could leave, appellant hit her on the
head with a chain, grabbed her by the hair and began hitting her "all over my body" with the
chain wrapped around his fist. Appellant put the chain around her neck and threatened to kill her.
After throwing Jones to the floor and kicking her, appellant "straddled my body . . . jerked my
head to the right as hard as he could," walked off, and "laid down on the bed and passed out."
Jones testified she received a broken nose, two broken teeth, a broken toe, permanent loss of the
use of a little finger, loss of ability to see out of one eye for a few days and numerous cuts and
bruises as a result of the attack that lasted two hours.
Appellant testified he was an alcoholic, had undergone treatment for the problem
and was on parole until 1993 resulting from a five-year term of confinement for a felony D.W.I.
conviction. Appellant did not remember how many times he hit Jones with his fist, but denied
striking her with a chain. Appellant suggested that many of the injuries Jones sustained resulted
from their falling over a coffee table and her kicking at him and hitting the bed. He did not
threaten to kill Jones at any time during the fight that lasted for "maybe two minutes." Appellant
described his condition as "drunk."
Officer Bruno Matarozzo of the Killeen Police Department testified that he was
contacted by a counselor at the "Families in Crisis Center" to see Jones. Jones was reluctant to
identify her attacker for fear the police would be unable to protect her. In describing the extent
of Jones' injuries, Matarozzo stated, "[I]n routine police work . . . where I deal mainly with
domestic violence crimes she was the worst I had ever seen."
Appellant's point of error is directed to testimony elicited from him by the
prosecutor over his objection relative to prior D.W.I. convictions. During cross-examination of
appellant by the prosecutor, the following occurred:
Q: Now, this last time you went to court when you got sent to the penitentiary
you committed that offense right over there in front of Luby's, in front of the
Killeen Mall when you flipped your pickup. Do you recall all that?
A: Yes, sir.
MR. HARRIS [defense counsel]: Object, Your Honor, to the relevance of
this. We've already proven the prior convictions. The facts I think are not
in issue. We're not trying that case. We're trying the case of September the
7th.
THE COURT: Overruled.
* * *
Q: You had a .42 blood, blood alcohol test that you -- in that case. A .42 does
that not indicate to you that if you can be driving a truck on the street and be
four times the level of legal intoxication that you could be the very person that
Lily has described to this jury that don't have a clue of how mean they are and
what they've done; is that true? Are you that kind of person?
A: I don't know what you're getting at.
Q: You can drive a truck with a .42 blood alcohol that's what you had in this last
DWI case when I was your prosecutor, didn't you.
A: Yes, sir. That's what they said.
Q: Well, you certainly didn't want to go to trial in there and contest that, did
you?
[Defense counsel]: Your Honor, I do object to any question about how we
arrived at the judgment here.
THE COURT: I believe we've gone far enough, Mr. Carroll [Prosecutor].
Q: You pled guilty in that case rather than ask for a jury trial, didn't you?
A: I didn't have the money to pay for no jury trial.
Q: You think you have to have money to tell this judge you want a jury trial?
[Defense counsel]: Object, I would like a hearing outside the presence of the
jury. Now we're getting so far afield we're talking about prior attorney-client
relationships.
THE COURT: I'll overrule the objection. Let's move on please.
Neither the State nor the defendant may introduce into evidence the details of a
prior conviction. Hodge v. State, 631 S.W.2d 754, 759 (Tex. Crim. App. 1982). Contrary to
the State's argument that the appellant's objections were not specific enough to preserve error,
we find that the ground relied on was sufficiently clear in its context to fairly apprise the court
of his objection. See Tex. R. Crim. Evid. Ann. 103 (Pamph. 1992); Lankston v. State, 827
S.W.2d 907, 911 (Tex. Crim. App. 1992).
We must next determine whether the error was such as to require reversal.
Reversal is mandated unless the reviewing court "determines beyond a reasonable doubt that the
error made no contribution to the conviction or to the punishment." Tex. R. App. P. Ann.
81(b)(2) (Pamph. 1992). In Harris v. State, 790 S.W.2d 568, 585-88 (Tex. Crim. App. 1990),
the court noted that while Rule 81(b)(2) mandates that the reviewing court focus on whether the
error contributed to the conviction or punishment, it must determine whether it might possibly
have prejudiced the juror's decision-making process.
The complained-of evidence relates to details of appellant's prior D.W.I.
convictions. The thrust of appellant's defense, as evidenced by defense counsel's argument, was
that appellant did not intend to kill Lily Jones. The jury apparently agreed that this was a valid
defense, finding appellant guilty of the lesser-included offense of aggravated assault. Appellant
testified that his problems were the result of being an alcoholic. His former wife, Judith Linville,
a defense witness, testified that appellant's drinking problem was instrumental in their divorce.
In his argument, defense counsel noted that appellant had been convicted "at least six and maybe
eight times" of driving while intoxicated. Defense counsel characterized appellant as a "drunk
. . not necessarily a happy drunk . . . . In fact he may be a dangerous drunk." Defense counsel
placed emphasis on that portion of the court's charge defining intoxication to negate appellant's
intent to kill. The testimony about which appellant complains appears to support his defense that
he was not capable of possessing the requisite mental intent to kill because of his intoxication.
While appellant contended that he was guilty of nothing more than the offense of assault, the
severity of the injuries described by Jones is supported by the testimony of Sanders and
Matarozzo, as well as photographs in evidence depicting her injuries. We have no difficulty in
concluding that the complained-of testimony was harmless beyond a reasonable doubt in that it
made no contribution to the conviction, nor did it prejudice the jurors in the decision-making
process.
At the punishment stage of the trial, appellant's brother and sister gave additional
testimony relative to his drinking problem. While a copy of the P.S.I. (presentence investigation)
is not in the record, we note that the prosecutor argued without objection that the P.S.I. reflected
that appellant told the presentence people that he used the chain on Jones. We conclude beyond
a reasonable doubt that the complained-of evidence made no contribution to the punishment nor
did it prejudice the court's decision-making process. Moreover, the punishment hearing having
been before the court, it is presumed that the trial court disregarded any inadmissible evidence.
See Miffleton v. State, 777 S.W.2d 76, 82 (Tex. Crim. App. 1989). Appellant's point of error
is overruled.
The judgment is affirmed.
Tom G. Davis, Justice
[Before Justices Powers, Jones and Davis*]
Affirmed
Filed: August 12, 1992
[Do Not Publish]
* Before Tom G. Davis, Judge (retired), Court of Criminal Appeals, sitting by assignment.
See Tex. Gov't Code Ann. § 74.003(b) (1988). | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1534640/ | 813 S.W.2d 862 (1991)
STATE of Missouri, Respondent,
v.
Leamon WHITE, Appellant.
No. 71600.
Supreme Court of Missouri, En Banc.
July 23, 1991.
Rehearing Denied September 10, 1991.
*863 Nancy A. McKerrow, Columbia, Bruce W. Simon, Kansas City, for appellant.
William L. Webster, Atty. Gen., Joseph P. Murray, Asst. Atty. Gen., Jefferson City, for respondent.
BLACKMAR, Chief Justice.
Defendant White directly appeals his jury conviction of first degree murder, three counts of armed criminal action, and two counts of first degree assault. He also moved for postconviction relief under Rule 29.15 and now appeals from the motion court's denial of relief on procedural grounds. These two appeals were consolidated for review pursuant to Mo. Const. 1945, Art. V, Section 3 and Rule 29.15(l).
Defendant does not challenge the sufficiency of the convicting evidence, but a brief rendition of the facts follows. Defendant went with his friend Roger Buckner to the home of the victims, Don Wright and Carol Kinney. Also present was the third victim, Ernest Black, a guest in the home.
The purpose of defendant's visit was to obtain some "crack" cocaine. Wright had previously promised to get the cocaine and sell it to White. When defendant and Buckner arrived they discussed the crack deal with Wright. During the discussion Cleveland Ford, another of White's friends, came into the house unannounced through the back door and claimed to be associated with defendant and Buckner. At that point, the three purported drug buyers drew guns. Defendant put his gun to Wright's head and asked him where he kept the money and drugs. Wright said there were no drugs or money in the house. Defendant and his companions then tied up Wright, Black, Kinney and Kinney's two children, apparently with extension cords. The assailants beat Wright and Black with their guns, all the while unsuccessfully interrogating them about where the money and drugs could be found.
According to the witnesses' testimony, White declared that the three adults should die. Ford held up Wright's head while defendant slit his throat. Buckner then cut Kinney's throat repeatedly, slicing her jugular vein. Defendant, Buckner, and Ford then turned on the gas stove, extinguished the pilot lights, and left the apartment. Wright died from strangulation and asphyxiation. Black and Kinney survived this vicious attack and later identified *864 White, Buckner and Ford as their attackers.
Rule 29.15 Proceedings
After his conviction defendant filed a timely but unnotarized pro se postconviction motion on August 17, 1989. The motion court appointed counsel on September 25, 1989. Movant's attorney entered his appearance and moved for a thirty day extension on October 20, 1989. On November 9, 1989 the first attorney filed a motion to withdraw, and a second attorney entered his appearance as movant's counsel. This second attorney filed a "First Amended Motion" and a motion for a thirty day extension of time on November 27, 1989. The motion court then granted movant until January 9, 1990 to file a second amended motion. Movant's counsel filed the second amended motion on January 8, 1990. On August 1, 1990 the motion court entered its findings of fact and conclusions of law denying movant relief without an evidentiary hearing.
Movant argues that this case should be remanded to the motion court for findings on the issue of postconviction counsel's abandonment in light of this Court's recent decisions in Sanders v. State, 807 S.W.2d 493 (Mo. banc 1991), and Luleff v. State, 807 S.W.2d 495 (Mo. banc 1991). We agree.
Rule 29.15(f) provides:
Any amended motion shall be verified by movant and shall be filed within thirty days of the date counsel is appointed or the entry of appearance by counsel that is not appointed. The court may extend the time for filing the amended motion for one additional period not to exceed thirty days ...
This Court has held that the effective date of appointment of counsel is the date on which the office of public defender is designated rather than the date of counsel's entry of appearance. See Schneider v. State, 787 S.W.2d 718, 720 (Mo. banc), cert. denied ___ U.S. ___, 111 S. Ct. 231, 112 L. Ed. 2d 186 (1990) (applying the stated rule prospectively). In this case the motion court appointed counsel, and the thirty day limitation began to run, on September 25, 1989. Movant's first counsel obtained the allowed thirty day extension on October 20, 1989 and then withdrew from the case on November 9, 1989. Movant's second postconviction counsel entered his appearance on November 9, 1989, but failed to file an amended motion until November 27, 1989. Rule 29.15(e) specifically states:
For good cause shown, appointed counsel may be permitted to withdraw. If appointed counsel is permitted to withdraw, the court shall cause new counsel to be appointed.
Neither of movant's attorneys obtained the motion court's permission for the change of counsel.[1]
The first attorney's withdrawal without permission from the motion court could constitute abandonment which arguably prejudiced movant. This issue of abandonment should be the subject of a factual inquiry by the motion court, by conducting an evidentiary hearing, or by examining the existing record if no disputed facts appear.
Movant argues that his second counsel also effectively abandoned him by failing to file a timely and complete amended motion. He argues that the amended motions were not properly verified and do not allege sufficient facts and grounds as required by Rule 29.15(e). This failure to verify and properly amend the claims raises questions as to whether the defendant was essentially abandoned by his postconviction counsel. These issues should also be adjudicated in a factual hearing conducted by the motion court under the teaching of Sanders, 807 S.W.2d at 495.
Counsels' withdrawal, failure to file a timely amended motion, and failure to verify and allege sufficient facts raise serious questions as to whether the movant received postconviction representation in the sense of Rule 29.15. Answers to these questions are for the motion court as part *865 of movant's Rule 29.15 proceedings. Sanders v. State, 807 S.W.2d at 495.
Direct Appeal
In the interest of expedition, we also address defendant's direct appeal claims and find them to be without merit.
Defendant presents five primary claims of error in his direct appeal. First, defendant alleges the trial court erred in refusing to order a new trial after the court informed the jury during voir dire that the two possible sentences for first degree murder included the death penalty or life imprisonment without probation or parole, unless the governor exercised his executive clemency powers. Defendant claims this statement "served to dilute and restrict the [jurors'] sense of responsibility," and is therefore constitutionally prohibited under Caldwell v. Mississippi, 472 U.S. 320, 105 S. Ct. 2633, 86 L. Ed. 2d 231 (1985).
First, it must be noted that defendant's counsel did not object to these comments at the time they were made, and our review is necessarily limited to plain error. Rule 30.20; State v. McMillin, 783 S.W.2d 82, 95 (Mo. banc), cert. denied ___ U.S. ___, 111 S. Ct. 225, 112 L. Ed. 2d 179 (1990). We find no plain error resulting from the trial court's correct statements of the law. The Supreme Court addressed this question in California v. Ramos, 463 U.S. 992, 103 S. Ct. 3446, 77 L. Ed. 2d 1171 (1983), and held that an instruction allowing the jury to consider the governor's powers did not impermissibly restrict the jurors' role in sentencing. Accordingly, this Court held in State v. Feltrop, 803 S.W.2d 1 (Mo. banc 1991), that no error results where the statements were correct statements of existing law. Id. at 9 (citing Dugger v. Adams, 489 U.S. 401, 109 S. Ct. 1211, 103 L. Ed. 2d 435 (1989)). The trial court's statements about punishment accurately reflect Missouri law on the possible punishments for first degree murder. See § 565.020.1. Defendant's first point is denied.
Defendant's second point alleges that the trial court erred by impermissibly restricting the defense counsel's cross-examination of the state's chief witness, Carol Kinney. Defense counsel confronted Ms. Kinney with prior inconsistent statements made to the police and other witnesses in an effort to impeach her direct examination testimony. Defendant accurately points out that this Court set a liberal standard for impeachment of witnesses in State v. Bowman, 741 S.W.2d 10 (Mo. banc 1987), cert. denied 488 U.S. 829, 109 S. Ct. 83, 102 L. Ed. 2d 60 (1988). But the use of prior inconsistent statements is not absolute. In State v. Taylor, 726 S.W.2d 335 (Mo. banc 1987), we held "impeachment may be made only where the witness has been asked the specific question upon which [she] is sought to be discredited." Id. at 337 (citations omitted). The scope of cross examination is soundly within the trial court's discretion. This contention is well-supported by Missouri cases both from this Court and the courts of appeals.[2] The trial court's decision was not an abuse of discretion. The second point is also denied.
Third, defendant claims the trial court erred in sustaining the prosecutor's challenge of venire members Robertson and Bryson for cause on account of their opinions about imposing the death penalty. Again, this matter rests within the discretion of the trial court, and we find no reason to disturb that court's ruling. This Court in State v. McMillin, 783 S.W.2d at 91, reiterated the proper standard for striking venire members based on their views regarding the death penalty. The record must show for each venire member struck that the "views would `prevent or substantially impair the performance of his [or her] duties as a juror in accordance with his [or her] instructions and his [or her] oath.'" Id. at 91, quoting Wainwright v. Witt, 469 U.S. 412, 420, 105 S. Ct. 844, 850, 83 L. Ed. 2d 841 (1985).
*866 Venireperson Robertson clearly stated that as a member of the jury he would be incapable of considering death as one of the possible penalties. Defense counsel made no attempt to rehabilitate this venire member, although he did object "just for the record." Similarly, Venireperson Bryson stated that she was opposed to the death penalty. Upon defense counsel's questioning she stated that she could at least consider the death sentence, but would not vote in favor of imposing it. This Court defers to the trial judge's superior position to determine the impact of the venire member's statements and demeanor. The record supports the trial judge's conclusion that these jurors could not give appropriate consideration to the death penalty.
Defendant next argues the trial court erred by refusing defense counsel's motion for a mistrial based on statements made in the prosecutor's closing argument. The prosecutor stated:
Because if one of you doesn't do your job, if just one of you doesn't do your job, ladies and gentlemen, this man wins, and this man gets away with what he intended ...
Defendant's attorney immediately objected to this statement and requested the court to give the jury instructions to disregard the statement and follow the written instructions as given by the court. The trial court sustained the objection and gave the cautionary instruction defendant requested. Defense counsel then moved for a mistrial "to protect the record," but stated he did not want a mistrial "as a practical matter." The trial court denied the mistrial motion.
Under these circumstances, the trial court cannot be said to have erred in refusing to grant the drastic remedy of a mistrial. See State v. Laws, 668 S.W.2d 234, 238 (Mo.App.1984). The defendant cannot complain about the denial of a mistrial when his counsel plainly told the court that he did not want this relief.
Finally, defendant invokes this Court's mandatory proportionality review under § 565.035, RSMo 1986, and argues that the death sentence in this case is excessive and disproportionate when compared to similar cases. We reject this contention and further find no indication that the sentence was imposed under the influence of passion, prejudice or any other arbitrary factor.
Disregarding those cases in which the state waived the death penalty as a possible sentence,[3] this defendant's death sentence is apparently commensurate with other similar cases in which the ultimate penalty has been imposed. We find cases similar to this one in which the jury recommended the death penalty. In State v. Grubbs, 724 S.W.2d 494 (Mo. banc 1987), a defendant was sentenced to death for tying up a victim, cutting his throat, and attempting to burn down the victim's trailer where the crimes occurred. Similarly, in State v. McMillin, 783 S.W.2d 82 (Mo. banc 1990), this Court upheld a death sentence for a defendant who gagged, beat and set on fire a victim from whom the defendant had expected to obtain illegal drugs. Other cases with somewhat similar facts may not have resulted in the imposition of the death penalty, but this circumstance does not require the mitigation of this death sentence. The proper inquiry in determining proportionality is "not whether any similar case can be found in which the jury imposed a life sentence, but rather whether the death sentence is excessive or disproportionate in light of `similar cases' as a whole. See § 565.035.3(3)." State v. Mallett, 732 S.W.2d 527, 542 (Mo. banc 1987). On the basis of prior cases, we find this defendant's sentence comports with similar cases in which other defendants received the death penalty. Defendant claims that his death sentence is disproportionate because his accomplice received a life sentence for his role in the crimes (see State v. Buckner, 810 S.W.2d 354 (Mo.App.1991)), but the state waived the death penalty in that case. The multiple and vicious assaults, in the course of an attempt to obtain money *867 and drugs, demonstrate conduct of the most aggravating sort.
Conclusion
Defendant's conviction and death sentence are affirmed pursuant to § 565.035.5, RSMo 1986. His appeal based on the denial of Rule 29.15 relief is reversed and remanded to the motion court for further proceedings consistent with Sanders v. State, 807 S.W.2d 493 (Mo. banc 1991) and this opinion.
ROBERTSON, C.J., COVINGTON, J., DON W. KENNEDY, Special Judge, and HIGGINS, Senior Judge, concur.
HOLSTEIN, J., concurs in separate opinion filed.
RENDLEN, J., concurs and concurs in separate opinion of HOLSTEIN, J.
HOLSTEIN, Judge, concurring.
I concur fully in the Court's decision affirming the conviction. However, my concurrence with that portion of the opinion reversing the Rule 29.15 conviction is done with some reservations. I believe there is a serious question whether the appellant has properly preserved, in his point relied on, any claim that there was a violation of Rule 29.15(e). It is not a constitutional violation, but a violation of that rule which justifies a reversal under the opinions in Luleff v. State and State v. Sanders, cited and relied on in the majority opinion.
The point relied on, upon which the Rule 29.15 judgment is reversed, states as follows:
The motion court clearly erred in denying appellant's motion for postconviction relief because the record shows that appellant was denied a full and fair hearing on all of his claims due to ineffective assistance of appointed 29.15 motion counsel, in violation of the fifth, sixth, eighth, and fourteenth amendments to the United States Constitution and article I, sections 10, 18(a), and 21 of the Missouri Constitution, in that appointed counsel failed to file a timely amended motion and failed to ascertain if all justiciable allegations of error were included in the amended motion that was filed.
It is noteworthy that no claim is made in the point relied on that counsel or the trial court failed to comply with Rule 29.15(e). In the authorities under the point, no mention is made of Rule 29.15(e). The rules are reasonably clear as to what is required in a point relied on portion of a brief:
The points relied on shall state briefly and concisely what actions or rulings of the court are sought to be reviewed and wherein and why they are claimed to be erroneous, with citations of authorities thereunder.
Rule 84.04(d). In this particular case, the only violation asserted is a violation of a constitutional right. No claim is made that the rules of this Court were violated.
The United States Supreme Court recently reiterated that there is no constitutional right to counsel in a post-conviction proceeding, and the burden of an error made by an attorney in a collateral proceeding, including failing to meet time constraints under a state procedural rule, falls on the shoulders of the defendant. Coleman v. Thompson, ___ U.S. ___, 111 S. Ct. 2546, 115 L. Ed. 2d 640 (1991).
I can think of nothing that is clearer than the language of our rule requiring the preservation of claims:
Apart from questions of jurisdiction of the trial court over the subject matter and questions as to the sufficiency of pleadings to state a claim upon which relief can be granted or a legal defense to a claim, allegations of error not briefed or not properly briefed shall not be considered in any civil appeal....
Rule 84.13(a) (emphasis added). The language of that rule must be given at least as much meaning and force as the language of Rule 29.15(e).
In this case, appellant's brief was filed before the decision in Luleff and Sanders. Only in the reply brief was Rule 29.15 relied on and Luleff and Sanders were cited. Because of the peculiar circumstances of this case, I am willing to forgive the shortcomings in appellant's brief. In *868 the future, I will not join in an opinion in which the Sanders claim is not properly preserved in a brief that complies with this Court's rules. To require less than compliance with our rules on briefing undermines the integrity of all the rules and leads to confusion among bench, bar and the general public. The rationale behind the rule on briefing is stated in Thummel v. King, 570 S.W.2d 679, 686 (Mo. banc 1978), and need not be amplified here. It is sufficient to say that requiring a party to identify the issues to be decided is not unreasonable, but is essential to our process.
The current vogue in capital cases is to transmute virtually every claim of error into a violation of some provision of the state or federal constitution. The fact is that many, if not most, rights are granted under the grace of a rule, statute or judicial precedent. The right to counsel and counsel's duties in a Rule 29.15 proceeding are guaranteed by the rule, not the Constitution. Failure to properly brief the point is, or at least should be, a waiver of the claim.
NOTES
[1] We express no opinion as to what impact, if any, a withdrawal permitted by the motion court would have on the time limitations contained in Rule 29.15.
[2] See, e.g., State v. Taylor, 726 S.W.2d 335 (Mo. banc 1987); State v. Gilmore, 681 S.W.2d 934 (Mo. banc 1984); State v. Laux, 755 S.W.2d 315 (Mo.App.1988); and State v. Dunn, 731 S.W.2d 297 (Mo.App.1987).
[3] The Court has held that such cases are not appropriately considered for proportionality review purposes. See State v. Byrd, 676 S.W.2d 494 (Mo. banc 1984). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534667/ | 251 B.R. 302 (2000)
In re SOUTHERN SOYA CORPORATION, Debtors.
No. 99-06987-W.
United States Bankruptcy Court, D. South Carolina.
May 2, 2000.
*303 *304 G. William McCarthy, Jr., Columbia, SC, for debtors.
Robert F. Anderson, Columbia, SC, trustee.
ORDER
JOHN E. WAITES, Bankruptcy Judge.
THIS MATTER comes before the Court upon the Motion to Require Debtor to Pay Post-Petition Loan or Alternatively, Request for Payment of Administrative Claim (the "Motion") filed by The Exchange Bank on March 31, 2000. Southern Soya Corporation ("Debtor"), Thomas L. Harper ("Harper"), and Edisto Farm Credit filed Responses in support of the Motion. On April 11, 2000, a Response to the Motion was also filed by the Official Unsecured Creditors Committee (the "Committee") in which the Committee asserts that the debt for which payment is sought by The Exchange Bank is not entitled to an administrative priority status pursuant to 11 U.S.C. §§ 364 or 503.[1] Bank of America, N.A. also filed a Limited Objection to Motion stating that the bank opposes any payments to The Exchange Bank which would jeopardize Bank of America, N.A.'s cash collateral position in the case.[2] After considering the pleadings filed with the Court and the arguments of counsel at the hearing on the Motion, the Court makes the following Findings of Fact and Conclusions of Law pursuant to Rule 52 of the Federal Rules of Civil Procedure, made applicable by Rule 7052 of the Federal Rules of Bankruptcy Procedure.[3]
FINDINGS OF FACT
1. Debtor is the owner of a soybean milling complex in Estill, South Carolina and *305 owns other related assets in Allendale and Sumter, South Carolina.
2. On August 19, 1999, Debtor filed a petition for relief under Chapter 11 of the Bankruptcy Code and still continues to manage its properties and operate its business as debtor-in-possession pursuant to §§ 1107 and 1108.[4]
3. On August 20, 1999, Debtor filed its Motion for Authority to Incur Debt pursuant to § 364(c)(2), § 363, and § 105 in which Debtor sought the approval of a $4,000,000.00 loan from The Exchange Bank.[5] The loan by The Exchange Bank would be partly secured by unencumbered real property owned by Debtor; and, additionally, it would be guaranteed by Debtor's principal, Thomas L. Harper, said guaranty to be secured by real property owned by Mr. Harper.
4. Mr. Harper signed an Unconditional Guaranty on September 3, 1999, which specifically provides that "[t]his Guaranty is and shall remain an unconditional and continuing guaranty of payment and not of collection."
5. The purpose of the loan from The Exchange Bank was to fund necessary operating expenses of Debtor, including operating losses anticipated for the early months of the Chapter 11 case.
6. The key terms of the loan provided for monthly interest payments at the rate of prime plus 1% floating, with a default rate of 12%. The loan also provided that the maturity date would be January 4, 2000, subject to extension upon agreement of the parties and approval of the Court.
7. The only objection to the Motion for Authority to Incur Debt was filed by Bank of America, N.A.
8. Following a series of hearings and through various orders, the Court authorized Debtor to borrow up to approximately $4,000,000.00 from the Exchange Bank on the above stated terms.
9. On January 12, 2000, Debtor filed a Motion for Order Authorizing Debtor-in-Possession to Obtain Financing Pursuant to §§ 364(c)(2), 363, and 105, in which Debtor sought authority to modify the terms of the loan to extend the maturity date originally set for January 4, 2000. On February 23, 2000, the Court entered an Order granting the extension of the maturity date on the loan until May 4, 2000, with monthly interest payments continuing to be made by Debtor.
10. Since the Court's approval of the loan by The Exchange Bank, Debtor has made draws against the line of credit in the aggregate amount of $3,925,000.[6] As of March 31, 2000, the principal balance of the loan had been reduced to $3,725,000. Under the terms of the loan, interest accrues on the outstanding principal, so the principal reduction has saved interest carrying costs to the estate.
11. On March 30, 2000, Kelley Grain Company's Motion to Convert the case to Chapter 7 was heard before this Court. At the hearing, Debtor represented to the Court that pursuant to the terms of its proposed Chapter 11 Plan, filed on March 22, 2000, it intended to continue operations until approximately May 30, 2000, in an effort to generate funds to pay its post-petition obligations, including its loan to *306 The Exchange Bank, and to minimize potential damage claims that would result from any breach of post-petition soybean contracts. During the course of the hearing, the Committee and Kelley Grain Company questioned the propriety of Debtor utilizing its operating revenues to pay the post-petition loan due to The Exchange Bank. As a result of these asserted positions, The Exchange Bank filed the Motion which is presently before this Court.
CONCLUSIONS OF LAW
The Exchange Bank argues that the outstanding amount of the loan made to Debtor should be allowed as an administrative expense pursuant to § 503(b)(1)(A) of the Bankruptcy Code. The Committee objected to the Motion on the grounds that The Exchange Bank secured its loan to Debtor by acquiring a security interest in both Debtor's unencumbered real property and by having Mr. Harper guarantee the loan; therefore, The Exchange Bank should not be allowed to change the nature and security of the loan extended to Debtor. The Committee asserts that had The Exchange Bank looked to Debtor's operations profit, inventory or accounts receivable as security for the loan, it should have sought a lien on such or should have, in the alternative, sought an administrative priority for repayment at the time it made the loan.
A. Section 364
The first question that the Court must consider is whether the three Orders Authorizing Debtor-in-Possession to Obtain Financing pursuant to 11 U.S.C. § 364(c)(2), 363 and 105,[7] which authorized the loan from The Exchange Bank to Debtor, grants The Exchange Bank an administrative priority in conjunction with the explicitly granted secured status under § 364(c)(2). The Committee argues that the original Motion for Authority to Incur Debt filed by Debtor on August 20, 1999, included no reference to § 364(a), (b), or (c)(1), under which an administrative priority for repayment may be authorized by the Court; and, because § 364 sets forth a hierarchy of inducements to prospective lenders, The Exchange Bank, which chose to secure its loan to Debtor though the pledge of real estate, should be precluded at this time from choosing another subsection of § 364 as its security.[8]
Section 364 provides in pertinent part:
(a) If the trustee is authorized to operate the business of the debtor under section 721, 1108, 1203, 1204, or 1304 of this title, unless the court orders otherwise, the trustee may obtain unsecured credit and incur unsecured debt in the ordinary course of business allowable under section 503(b)(1) of this title as an administrative expense.
(b) The Court, after notice and a hearing, may authorize the trustee to obtain unsecured credit or to incur unsecured debt other than under subsection (a) of this section, allowable under section 503(b)(1) of this title as an administrative expense.
(c) If the trustee is unable to obtain unsecured credit allowable under section *307 503(b)(1) of this title as an administrative expense, the court, after notice and a hearing, may authorize the obtaining of credit or the incurring of debt
(1) with priority over any or all administrative expenses of the kind specified in section 503(b) or 507(b) of this title;
(2) secured by a lien on property of the estate that is not otherwise subject to a lien; or
(3) secured by a junior lien on property of the estate that is subject to a lien.
The Court finds that the Committee is correct to the extent that "[t]he subdivisions of Code § 364(c) are in the alternative; the authorization of credit under one does not imply authorization under another absent application for such additional relief." In re Sobiech, 125 B.R. 110, 115 (Bankr.S.D.N.Y.1991); aff'd 131 B.R. 917 (S.D.N.Y.1991). However, this Court finds that the fact that § 364 sets forth an "escalating series of inducements" and that a creditor who chooses to acquire the position under one subsection may not "fall back" to the position that a creditor would have under a different subsection does not in itself preclude the creditor from seeking repayment of a debt as an administrative expense pursuant to § 503(b). This premise is supported by various cases. See, e.g., In re Sobiech, 125 B.R. at 114-15 n. 2; Sapir v. CPQ Colorchrome Corp. (In re Photo Promotion Assoc.), 87 B.R. 835, 840-41 (Bankr.S.D.N.Y.1988); aff'd 881 F.2d 6 (2d Cir.1989); In re Pizza Hawaii, Inc., 69 B.R. 60, 61-62 (Bankr.D.Hawai'i 1986).
In In re Photo Promotion Assoc., Colorchrome was unwilling to extend unsecured credit to the debtor-in-possession in the ordinary course of business pursuant to § 364(a). As a result, Colorchrome sought to secure its photo finishing charges to the debtor by obtaining an assignment of the debtor's accounts receivable. However, Colorchrome's attempt to acquire a secured position failed because it did not get the bankruptcy court's authorization as required by § 364(c). Colorchrome argued that a creditor who has attempted to acquire secured status pursuant to § 364(c) but has failed in doing so is entitled to "fall back" to § 364(a) or alternatively should be entitled to an administrative status pursuant to § 503(b)(1). As to the ability of the creditor to "fall back" on a separate subsection, the court concluded:
There are no cases supporting Colorchrome's "fall back" argument because 11 U.S.C. § 364 was not structured to give a creditor, who violates the requirement under 11 U.S.C. § 364(c) for court approval, two bites of the apple and to be able to "fall back" to the position of a creditor who was willing to extend unsecured credit to a debtor pursuant to 11 U.S.C. § 364(a). If Colorchrome qualifies for administrative priority status it will be because of the application of another section of the Bankruptcy Code and not because Colorchrome may "fall back" from subsection (c) to subsection (a) in the same section.
In re Photo Promotion Assoc., Inc., 87 B.R. at 840; see also In re Pizza of Hawaii, Inc., 69 B.R. at 61. The court then proceeded to determine whether the claim should be granted administrative expense status pursuant to § 503 and concluded that "[t]he fact that Colorchrome was not induced to extend unsecured credit to the debtor pursuant to 11 U.S.C. § 364(a) does not preclude Colorchrome from asserting an administrative priority claim for the actual and necessary expenses which it incurred in preserving the orders from the debtor's customers." Id. at 840-41. The court ultimately concluded that, after remitting all proceeds from the debtor's customers to the Trustee, Colorchrome could then assert the unpaid processing and shipping charges incurred in completing the debtor's orders as an administrative expense under § 503(b)(1)(A). Similarly, this Court finds that even though The Exchange Bank is precluded from requesting that it be granted status pursuant to *308 another subsection of § 364 other than (c)(2), it is not precluded from requesting an administrative expense allowance under § 503.
B. Section 503 and Administrative Expenses
Thus, the next issue before the Court is whether The Exchange Bank's loan to Debtor should be granted administrative expense status. Section 503(b)(1)(A) provides that a claim should be allowed administrative expense priority if it was for "the actual, necessary costs and expenses of preserving the estate, including wages, salaries, or commissions for services rendered after the commencement of the case." The main purpose behind granting administrative expense status to certain expenses of a debtor is to induce creditors and landlords to continue doing business with the debtor or to enter into new loans or contracts. See, e.g., In re Merry-Go-Round Enter. Inc., 180 F.3d 149, 158 (4th Cir.1999); see also Toma Steel Supply, Inc. v. TransAmerican Natural Gas Corp. (In re TransAmerican Natural Gas Corp.), 978 F.2d 1409 (5th Cir.1992) (quoting In re Coastal Carriers Corp., 128 B.R. 400, 403 (Bankr.D.Md. 1991)) ("The purpose of Section 503 is to permit the debtor's business to operate for the benefit of its pre-petition creditors. In order to effectuate a successful reorganization, third parties must be willing to furnish post-petition goods or services on credit. Third parties might refuse to extend credit to debtors-in-possession for fear that their claims would not be paid, but an advance payment requirement would impede the debtor's business. Section 503 requires that such claims be given priority, therefore inducing third parties to extend credit and enhancing the likelihood of a successful reorganization.").
The claimant, in this case The Exchange Bank, has the burden to prove its entitlement to the administrative priority by a preponderance of the evidence. See, e.g., In re Merry-Go-Round, 180 F.3d at 157; In re Knoth, C/A No. 93-75478-B (Bankr.D.S.C.2/5/1996) (citing In re Bellman Farms, 140 B.R. 986, 995 (Bankr. D.S.D.1991)). The general rule is that, in order for a claim to be qualified as an administrative expense, the claimant must prove that (a) it arises from a transaction entered into post-petition with the debtor-in-possession, and (2) it must directly and substantially benefit the estate. See, e.g., In re Merry-Go-Round, 180 F.3d at 157; In re Jartran, Inc., 732 F.2d 584, 586-86 (7th Cir.1984); In re Economy Lodging Sys., Inc., 226 B.R. 840, 846-47 (Bankr. N.D.Ohio 1998); aff'd 234 B.R. 691 (6th Cir. BAP 1999); see also In re Cappelmann, C/A No. 94-75599-W (Bankr. D.S.C.12/23/1996) (quoting In re Knoth, C/A No. 93-75478-B (Bankr. D.S.C.2/5/1996)) ("When expenses are incurred without the authorization or approval of the trustee, the expenses must meet the following three criteria for allowance as administrate expenses: (1) they must be actual expenses; (2) they must be necessary to the preservation of the bankruptcy estate; and (3) the creditor must have undertaken the expenses in order to benefit the bankruptcy estate as a whole, not to further his own self-interest.").[9]
*309 In the case presently before the Court, there is no argument as to the fact that the loan by The Exchange Bank arose from a post-petition transaction entered into between claimant and the debtor-in-possession and approved by the Court. The only factor that merits further consideration by the Court is the second requirement dealing with the issue of whether the loan benefitted the estate. Courts have generally held that "[a] claim is not rendered a post-petition administrative priority claim merely by the fact that the time for payment is triggered by an event that happens after the filing of the petition." In re DeMert & Dougherty, Inc., 227 B.R. 508, 512 (Bankr.N.D.Ill.1998); see also In re Sobiech, 125 B.R. 110, 115 (Bankr. S.D.N.Y.1991) ("The mere fact that credit was extended in a post-petition period does not mean that an administrative priority will automatically attach, notwithstanding the origin of the credit."); Sapir v. CPQ Colorchrome Corp. (In re Photo Promotion Assoc.), 87 B.R. 835, 839 (Bankr. S.D.N.Y.1988) (same). The court's inquiry as to whether an administrative expense should be granted centers around whether the estate received an actual benefit. As previously noted in this district,
"Section 503(b) ... must be narrowly construed. This ... narrow interpretation requires actual use of the creditor's property by the debtor, thereby conferring a concrete benefit on the estate before a claim is allowable as an administrative expense. Accordingly, the mere potential of benefit to the estate is insufficient for the claim to acquire status as an administrative expense. The court's administrative expense inquiry centers upon whether the estate has received an actual benefit, as opposed to the loss a creditor might experience by virtue of the debtor's possession of his property."
In re Cappelmann, C/A No. 94-75599-W (Bankr.D.S.C.12/23/1996) (quoting Ford Motor Credit Co. v. Dobbins, 35 F.3d 860 (4th Cir.1994)).
The Committee argues that The Exchange Bank's debt should not be granted administrative expense status because the loan did not ultimately benefit the estate in that, since the filing of the bankruptcy petition, Debtor has continuously operated at a loss and the credit extended by The Exchange Bank was a mere prelude to the ultimate liquidation of Debtor's business. The Committee looks to the outcome of the bankruptcy case to conclude that the loan did not benefit the estate which will ultimately be liquidated when the case is converted to a Chapter 7 effective May 31, 2000. However, several courts have observed that the outcome of the bankruptcy case is not conclusive indicia of whether the extension of credit was beneficial to the estate. See, e.g., In re Molnar Brothers, 200 B.R. 555 (Bankr. D.N.J.1996); White Front Feed & Seed v. State Nat'l Bank (In re Ramaker), 117 B.R. 959 (Bankr.N.D.Iowa 1990).
In In re Molnar Brothers, the debtor filed a plan of reorganization under Chapter 12 of the Bankruptcy Code which provided that creditors would be paid out of the proceeds of the sale of the estate's assets. Plant Food filed an administrative claim seeking to be compensated for providing seed and fertilizer purchased by the debtor-in-possession. Plant Food contended that the seed and chemicals offered a benefit to the debtor and the estate in that they were used in the planting operation of the farm and to feed cattle. However, the United States and the Trustee argued that because the debtor operated the farm under a liquidating plan, the products did not add any value to the estate. The court held that "the outcome of the bankruptcy is not the exclusive determination in projecting whether the transaction was beneficial to the estate," and concluded that because "the feeding of the livestock was an essential activity while the Farm was listed for sale ... through the auction date ... and that the 1993 crop was utilized as an actual and necessary expense of maintaining the Debtor's estate for that period," *310 Plant Food's claim warranted administrative expense status pursuant to § 503(b)(1)(A). Id. at 559; see also In re Ramaker, 117 B.R. at 961 (citation omitted) (emphasis added) ("The outcome of the bankruptcy ... is not the test. It is whether the transaction was beneficial to the debtor-in-possession `in the operation of the business.' Despite the fact that the reorganization failed, and despite the evidence that the 1988 crop was a poor one, White's credit sales of goods were still beneficial to the debtors-in-possession in the operation of the farm business. This court does not accept the hindsight argument that feed, seed, and fertilizer are not necessary expenses of a crop and livestock farming operation merely because the reorganization later fails.").
Similarly, in this case, the Court finds that The Exchange Bank's debt against Debtor should be granted an administrative expense status. The loan that The Exchange Bank extended to Debtor was an "actual" and "necessary" expense which benefitted the estate. The Court recognizes that Debtor's attempt to reorganize its business operations under Chapter 11 has apparently failed and that the parties have all consented to Debtor continuing its operation until May 30, 2000 at which time the case will be converted to a Chapter 7; but such inability to rehabilitate the business does not per se preclude a finding that The Exchange Bank's loan should be accorded the priority of an administrative expense. The funds that the bank extended were used by Debtor in the continuation of its soybean operations; without such funds Debtor's business would have closed long before May 30, 2000. At the hearing on the Motion, Debtor represented that continuation of operations would avoid the risk of incurring substantial administrative claims against the estate that would potentially arise from its inability to fulfill post-petition contractual obligations if there were an immediate cessation of operations. Therefore, the Court finds that the money that was actually utilized by Debtor in the operation of its business was a necessary cost and expense which warrants the granting of administrative expense status pursuant to § 503(b)(1)(A). See, e.g., Ford Motor v. Dobbins, 35 F.3d 860, 867 (4th Cir.1994) (emphasis added) ("That which is actually utilized by a Trustee in the operation of a debtor's business is a necessary cost and expense of preserving the estate [under § 503(b)] and should be accorded the priority of an administrative expense.'").[10] At the time of the loan, *311 Debtor was apparently honestly pursuing rehabilitation of the business. But for the loan extended by The Exchange Bank, Debtor would have been unable to operate its business, which appeared at the time to be in the best interest of general unsecured creditors.
C. Timeliness of Administrative Claims
Another ground on which the Committee objected is the tardiness of the administrative claim. The Committee argues that the request by The Exchange Bank has not been timely filed and that the appropriate time to have sought administrative priority under § 503(b)(1)(A) would have been at the time the original Motion for Authority to Incur Debt pursuant to § 364(c)(2), 363, and 105 was filed. Section 503(b)(1)(A) provides: "An entity may timely file a request for payment of an administrative expense, or may tardily file such request if permitted by the court for cause." Neither the Bankruptcy Code nor the Federal Rules of Bankruptcy Procedure, however, set forth a deadline within which administrative claims must be filed; rather, "courts can exercise their discretion in setting bar dates according to the circumstances of each case." 4 Collier on Bankruptcy ¶ 503.02[2] (15th ed. rev. 1997). This Court finds that The Exchange Bank's request for an administrative claim in this case was timely. The Committee argues that the administrative claim should have been requested along with the original Motion for Authority to Incur Debt. As discussed in detail above, the test to determine if a claim should be granted administrative expense status involves the determination of whether the advance benefitted the estate. Such a determination should be made when the Court can consider the events necessary to make a full and fair assessment of whether the transaction did, in fact, provide a benefit to the estate. In this case, the administrative claim was requested immediately after the hearing on Kelley Grain Company's Motion to Convert the case to a Chapter 7, when the Committee and Kelley Grain Company raised for the first time the propriety of utilizing Debtor's operating revenues to pay the post-petition loan; thus, the Court concludes that it was timely.
D. Guaranty by Thomas L. Harper
After the Committee was given further opportunity to review the loan documents governing the loan from The Exchange Bank to Debtor, it submitted a Supplemental Response to the Motion, in which it argued that the guaranties executed by Mr. Harper clearly establish that he is a primary obligor on the loan. Furthermore, the Committee points to the language in the Unconditional Guaranty signed by Mr. Harper on September 3, 1999, which provides that "[t]his Guaranty is and shall remain an unconditional and continuing guaranty of payment and not of collection" and asserts that "Guarantor acknowledges that Guarantor's liabilities and obligations hereunder are primary rather than secondary." The Committee maintains that when such language is contained in a guaranty, the lender may maintain an action directly against the guarantor without first bringing an action against the borrower or any collateral. This Court finds that the Committee's reasoning is correct to the extent that the lender can seek recovery from the guarantor without first attempting recovery from the borrower; however, this premise in itself does not warrant the Court's denial of the Motion when given the fact that the loan's repayment is not overdue, its maturity date is May 4, 2000.
*312 There is no dispute as to the fact that Mr. Harper's guaranty is an absolute and unconditional guaranty of payment as opposed to a guaranty of collection. The difference between the two types of guaranty is as follows: "Under an absolute guaranty of payment, the creditor may maintain an action against the guarantor immediately upon default of the debtor. A guaranty of collection conditions liability of the guarantor upon prosecution of the primary debtor without success." Peoples Fed. Savings & Loan Assoc. v. Myrtle Beach Retirement Group, Inc., 300 S.C. 277, 387 S.E.2d 672, 674 (1989) (emphasis added); see also Citizens and Southern Nat'l Bank v. Lanford, 313 S.C. 540, 443 S.E.2d 549, 550 (1994) (citations omitted) ("A guaranty of payment is an absolute or unconditional promise to pay a particular debt if it is not paid by the debtor at maturity. Under an absolute guaranty of payment, the creditor may maintain an action against the guarantor immediately upon default of the debtor."). There is no question that the guaranty and pledge of collateral by Mr. Harper were important reasons to The Exchange Bank's decision to extend the loan. However, the structure of the loan transaction indicates the expectation that Debtor be held liable as the initial obligor on the loan and remain responsible for repayment from its assets. Thus, the initial obligation to repay the funds pursuant to the terms of the loan documents is still that of Debtor; however, The Exchange Bank could turn to Mr. Harper in order to pursue its debt, but any remedial rights that it has under the guaranty arise only in the case Debtor defaults, which cannot occur until after May 4, 2000. From the foregoing arguments, the Court concludes that Debtor may pay the administrative claim of The Exchange Bank on par with other § 503(b) administrative claims in the case.[11]
CONCLUSION
From the foregoing arguments, it is therefore
ORDERED that The Exchange Bank's Motion to Request Payment of Administrative Claim is granted and the loan that The Exchange Bank extended to Debtor is granted administrative expense status pursuant to § 503(b)(1)(A).
AND IT IS SO ORDERED.
NOTES
[1] Further references to the Bankruptcy Code shall be by section number only.
[2] At the hearing on the Motion, held before the Court on April 14, 2000, Debtor agreed to segregate from the available proceeds the full amount of Bank of America, N.A.'s cash collateral.
[3] The Court notes that to the extent any of the following Findings of Fact constitute Conclusions of Law, they are adopted as such, and to the extent any Conclusions of Law constitute Findings of Fact, they are so adopted.
[4] Bank of America, N.A. and Kelley Grain Company, two creditors in this case, each filed a Motion to Convert Case from a Chapter 11 to a Chapter 7. The motions were heard before the Court on April 20, 2000, at which hearing the parties announced that the matter had been resolved and that all parties involved consented to Debtor continuing its operation until May 30, 2000 and to the conversion of the case to a Chapter 7 effective May 31, 2000.
[5] A Motion for Authority to Incur Debt consistent with the terms outlined above was simultaneously filed in the Chapter 11 case of Thomas L. Harper, Debtor's principal.
[6] The remaining available credit of $74,600 is being reserved for payment of interest pursuant to the loan terms approved by the Court.
[7] On August 27, 1999, the Court entered the first Order Authorizing Debtor-in-Possession to Obtain Financing Pursuant to 11 U.S.C. § 364(c)(2), 363 and 105. The Order granted Debtor's motion for authorization to obtain post-petition financing in the amount of $1,600,000.00. On September 10, 1999, the Court entered the Second Order Authorizing Debtor-in-Possession to Obtain Financing Pursuant to 11 U.S.C. § 364(c)(2), 363 and 105, granting Debtor the authority to obtain financing from The Exchange Bank up to $940,000. Finally, on September 14, 1999, the Court entered the Final Order Authorizing Debtor-in-Possession to Obtain Financing Pursuant to 11 U.S.C. § 364(c)(2), 363 and 105, granting Debtor the authority to obtain financing up to an additional $1,500,000.00.
[8] The Committee has not raised the issue of whether The Exchange Bank should be made to satisfy this claim from the sale of Thomas L. Harper's real property subject to the bank's mortgage under a marshaling of assets theory; therefore, the Court will not address such argument.
[9] If a debt does not arise from a transaction with the debtor-in-possession, it may still be accorded administrative priority if the creditor gave consideration to the debtor-in-possession. See, e.g., In re Lunan Family Restaurants, 194 B.R. 429, 449 (Bankr.N.D.Ill.1996); see also In re Patient Educ. Media, Inc., 221 B.R. 97, 101-02 (Bankr.S.D.N.Y.1998) (citations omitted) ("The party asserting the status of an administrative claimant has the burden of proof. He must demonstrate that (1) his claim arose from a transaction with or on account of consideration furnished to the debtor-in-possession, and (2) the transaction or consideration directly benefitted the debtor-in-possession."). "Consideration is furnished to the estate only where the debtor-in-possession induces post-petition performance or where performance on a contract not rejected by the debtor-in-possession is rendered to the estate." In re Lunan Family Restaurants, 194 B.R. at 449; see also In re Patient Educ. Media, Inc., 221 B.R. at 101-02.
[10] In support of its position, the Committee cites the case of In re C.E.N., Inc., 86 B.R. 303 (Bankr.D.Me.1988). In that case, shortly after the filing of the Chapter 11 petition, the president and sole shareholder of the corporate debtor made several advances to debtor that were needed to meet payroll expenses and bills. The creditor then sought reimbursement of the advances as an administrative expense status and argued that, pursuant to § 364(a), the debt was incurred in the ordinary course of business of the debtor. It was clear that the debtor was incurring the expenses not in an attempt to continue the operation of the business, but rather in an attempt to hold on to its assets until the estate was liquidated. The court ultimately held that the debtor's president could not acquire administrative status under § 364(a) because the debt was not incurred in the ordinary course of business. The court noted:
It is true that the type of expenses incurred in this case are common to virtually all business. If the debtor was incurring these expenses to further the business in pursuit of reorganization another conclusion might be warranted. But debtor's incurrence of these expenses was not in the ordinary course of business because the debtor was not continuing the business but preparing to sell its principal asset.
Id. at 305. The court then continued with an analysis under § 503(b)(1), independent of § 364, and concluded that the claim was not for an actual and necessary expense of preserving the estate in that "[the president and sole shareholder's] advances were made to protect his own interests and not the interests of general creditors." Id. at 306. This Court finds that this case, which is cited by the Committee in support of its position, is distinguishable from the factual and legal situation presently before the Court. In this case, the legal determination that remains before the Court is whether The Exchange Bank's claim meets the requirement of § 503(b)(1)(A) in order to be granted administrative expense status. The Exchange Bank, unlike the creditor in In re C.E.N., 86 B.R. 303, is not an insider of Debtor, but rather an independent party who openly provided a loan, through the Court's approval, to aid Debtor in continuing its business operations.
[11] The Court notes that The Exchange Bank never requested and the factual and legal circumstances of the case do not warrant super-priority status. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534701/ | 231 A.2d 265 (1967)
John W. McDUELL, Appellant,
v.
STATE of Delaware, Appellee.
Supreme Court of Delaware.
June 8, 1967.
Arthur J. Sullivan, of Morris, James, Hitchens & Williams, Wilmington, for appellant.
Robert E. Daley, Deputy Atty. Gen., Wilmington, for appellee.
WOLCOTT, C. J., and CAREY and HERRMANN, JJ., sitting.
*266 HERRMANN, Justice:
The question before us in this appeal is whether a conviction of violation of 21 Del.C. § 4176,[1] prohibiting "driving" a *267 motor vehicle while under the influence of intoxicating liquor, necessarily constitutes a second offense thereunder by reason of a prior conviction of violation of 21 Del.C. § 4111,[2] now repealed, which prohibited "operating" a motor vehicle while under the influence of intoxicating liquor.
In 1961, the defendant John W. McDuell, was convicted before a Justice of the Peace of violating § 4111. In 1964, § 4111 was repealed and replaced by § 4176.[3] In 1966, the defendant was convicted of violating § 4176. The Superior Court held the defendant to be a second offender under § 4176, and sentenced him as such to a prison sentence of 60 days and a fine of $1,200., with suspension of sentence deemed impermissible under the Statute. The defendant appeals on the ground that it was error to punish him as a second offender under § 4176.
The State contends that § 4111 and § 4176 are substantially the same; that § 4176 did not create a different offense; that, by virtue of the rule of simultaneous repeal and re-enactment, the prohibitions of § 4111 remain in force and effect despite the language changes of § 4176. We disagree.
The two Statutes are not substantially the same. They are materially different as to the scope of the offense as well as the severity of the punishment: § 4111 prohibited "operating" and was applicable to "vehicles upon the highway" (21 Del.C. § 4101, repealed); § 4176 prohibits "driving" and is applicable "upon the highways and elsewhere throughout the State" [21 Del.C. § 4101(a) (2)].
These differences manifest, in our judgment, an intent of the General Assembly to create by § 4176 an offense more limited in scope than that created by § 4111. The words "operating" and "driving" are not synonymous; they have well-recognized statutory distinctions. Of the two terms, the latter is generally accorded a more strict and limited meaning. The term "driving" is generally used to mean, in this connection, steering and controlling a vehicle while in motion; the term "operating", on the other hand, is generally given a broader meaning to include starting the engine or manipulating the mechanical or electrical devices of a standing vehicle. See Annotation 47 A.L.R.(2d) 570, et seq. The two words have been thus distinguished in Delaware. See State v. Pritchett, 3 Storey 583, 53 Del. 583, 173 A.2d 886 (1961).
Applying these definitions, the term "driving" is encompassed within the term "operating"; but the reverse is not necessarily so. One may not drive a vehicle without operating it; but one may operate the engine or devices of a vehicle without driving it. Otherwise stated: while all driving is necessarily operation of a motor vehicle, not all operation is necessarily driving.
We conclude that the Legislature intended thus to limit the Statute when in § 4176 it substituted the term "driving" for the term "operating", previously appearing in § 4111. It is noteworthy that in 1961, the Superior Court dealt with and distinguished the statutory terms "operating" and "driving" a motor vehicle while under the influence of intoxicating liquor. In State v. Pritchett, supra, § 4111 was found applicable to an intoxicated defendant found slumped over the steering wheel of a standing vehicle. Presumably, the General Assembly was aware of that case and its discussion *268 of the different meanings attributed to the statutory language here involved. Apparently, the Legislature made the changes advisedly, intending thereby to remove "standing" violations from the operation of the Statute.
Because it was thus changed, § 4176 may not be said to be substantially and materially the same as § 4111. § 4176 proscribes some, but not all, of the acts covered by § 4111. It follows that the doctrine of simultaneous repeal and re-enactment does not preserve § 4111 as part and parcel of § 4176.
Accordingly, insofar as the term "operating" does not coincide with the term "driving", § 4176 creates a newly limited offense. We hold that the term "driving" as used in § 4176 requires that the vehicle must be in motion in order for the act proscribed by that Statute to be committed. Compare State v. Mason, 141 W.Va. 217, 89 S.E.2d 425 (1955).
There remains, therefore, the question of whether the defendant's violation of § 4111 in 1961 was a "moving" violation. If so, he was properly dealt with by the Superior Court as a second offender under § 4176. If, on the other hand, the 1961 case was a "standing" violation, it was reversible error to treat the defendant as a second offender under § 4176.
The record is silent as to the details of the 1961 violation. The cause must be remanded, therefore, for a determination of the nature of that offense.
Finally, we should dispose of the defendant's contention that to treat him as a second offender would violate his constitutional guaranties against ex post facto laws, citing State v. Owens, 9 Terry 230, 101 A.2d 319 (1953) and State v. Fowler, Del.Super., 194 A.2d 558 (1963). The position is untenable. A law is not objectionable as ex post facto which, in providing punishment for a future offense, authorizes the offender's past conduct to be considered and the punishment graduated accordingly. 1 Cooley, Constitutional Limitations (8th Ed.) 553.
For the reasons stated, the cause is remanded for further proceedings consistent herewith.
NOTES
[1] 21 Del.C. § 4176(a) and (d) provides:
"(a) Whoever drives a motor vehicle while under the influence of intoxicating liquor or of any drug shall be fined, for the first offense, not less than $200 nor more than $1,000, or imprisoned not less than 60 days nor more than 6 months, or both. For each subsequent like offense, he shall be fined not less than $500 nor more than $2,000, and imprisoned not less than 60 days nor more than 18 months. A suspended sentence shall not be granted those convicted for a second offense under this section.
* * * * *
"(d) In determining whether an offense is a second offense hereunder no offense prior to February 29, 1956, shall be taken into consideration."
[2] 21 Del.C. § 4111(a) provided:
"(a) Whoever operates a motor vehicle while under the influence of intoxicating liquor or of any drug shall be fined, for the first offense, not less than $100 nor more than $500, or imprisoned 30 days, or both. For each subsequent like offense, he shall be fined not less than $200 nor more than $1,000, and imprisoned not less than 30 days nor more than one year."
[3] The repeal was part of the enactment of a new Motor Vehicle Code. See 54 Del. Laws, Chapter 160. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534709/ | 426 Pa. 166 (1967)
Raesner
v.
Heinsius, Appellant.
Supreme Court of Pennsylvania.
Argued November 16, 1966.
January 30, 1967.
Before BELL, C.J., MUSMANNO, COHEN, EAGEN, O'BRIEN and ROBERTS, JJ.
David C. Baldus, with him John A. Metz, Jr., Sigmund Rosenwasser, and Metz, Cook, Hanna & Kelly, for appellant.
*167 James E. McLaughlin, with him John M. Tighe, and McArdle, Harrington, Feeney & McLaughlin, for appellee.
OPINION BY MR. JUSTICE COHEN, January 30, 1967:
This is an appeal from the decree of the lower court directing defendant, in his capacity as administrator of the estate of Nellie Heinsius, deceased, to pay over to plaintiff the sum of $40,100, which amount the court determined was held by the deceased as constructive trustee for plaintiff at the time of her death.
As found by the chancellor, the facts are as follows: Over some twenty years, plaintiff had acquired the practice of leaving large sums of money for safe keeping with decedent's husband who kept the money in a Pittsburgh bank in safe deposit box number G-392, which he held jointly with his wife. After the death of decedent's husband, the money entrusted to him was returned to plaintiff.
On February 6, 1958, decedent changed the designation of her individual safe deposit box number G-479 at the same bank to the joint names of plaintiff and herself. During that month real estate belonging to plaintiff was sold, and the proceeds were sent to plaintiff in the form of certified checks totalling $49,500. These checks were cashed by decedent, and the proceeds $40,000 in one thousand dollar bills, $9,000 in one hundred dollar bills, and $500 in fifty dollar bills were placed by decedent in the jointly held safe deposit box. The serial numbers of the forty one thousand dollar bills were recorded by the bank, in compliance with bank policy, at the time the bills were paid out to decedent. Between February 6, 1958 and May 25, 1959, decedent gained entrance to the box on eight occasions, upon three of which she also entered a safe deposit box at the same bank held in the names of herself and her son, the present defendant. Plaintiff entered *168 box G-479 on only two dates, September 14, 1959 and September 17, 1959. On September 14, 1959, plaintiff notified decedent that the money that had been placed in the safe deposit box number G-479 was missing. Decedent denied having any knowledge of the disappearance.
Decedent rented a third safe deposit box at another bank, where she also maintained checking and savings accounts. From June 3, 1957 until her death on March 12, 1963, she was the only person having access to that box. Following her death the box was found to contain $25,000 in one thousand dollar bills and $6,700 in one hundred dollar bills. Twenty-three of these one thousand dollar bills were negotiated by defendant on April 17, 1963 and were found to bear serial numbers identical with twenty-three of those recorded in February 1958. It was also established that eight one thousand dollar bills were received by the Federal Reserve Bank three on December 19, 1959 and five on April 14, 1960 from the bank where decedent maintained her individual safe deposit box and her checking and savings accounts. The serial numbers on all eight bills matched those borne by eight of the bills paid over to decedent in February 1958.
Before she died, depositions of decedent were taken. In her depositions, she denied having taken the money and claimed that on one occasion she withdrew $9,400 from the safe deposit box number G-479 and handed it over to plaintiff so that he could satisfy a tax liability. The chancellor ruled that under the Dead Man's Act, Act of May 23, 1887, P.L. 158, § 5(e), 28 P.S. § 322, plaintiff was not competent to testify, and, therefore, her depositions are not contradicted.[1] It was, however, *169 directly proved by disinterested witnesses and evidence of banking policy that decedent had converted $31,000. Since there was no way to prove by direct evidence that the remainder of the missing money had been taken by decedent, the chancellor was satisfied that proof had been established circumstantially. Accordingly, he decreed that decedent's estate was liable to plaintiff in the sum of $40,100.
On appeal, decedent does not contest the award of $31,000 to plaintiff. Likewise, plaintiff does not contest the chancellor's ruling that the Dead Man's Act disqualified plaintiff from giving testimony that would contravert decedent's testimony that she had returned $9,400 to plaintiff. Defendant seeks merely to reduce the chancellor's award to $31,000, while plaintiff seeks to uphold the award of $40,100.
We are convinced that the chancellor's award was correct. Since it was conclusively and directly proved that decedent converted $31,000 of a larger fund entrusted to her for safekeeping, and since only decedent had access to the money until all of it was found missing, and since decedent lied about taking any of the money despite the incontrovertible proof that she had taken $31,000, we believe that it is fair to infer that she took the balance of the fund. Under the evidence, the only explanation for the difference in testimony as to who took the remaining $9,100 is that either decedent or plaintiff was not being truthful. Inasmuch as it has been shown that decedent lied about a portion of the fund, it is more reasonable to conclude that she lied about the rest than to discredit plaintiff's claim.
While there are no Pennsylvania cases directly on point, there is an Alabama case which holds that proof *170 of the mere possession of bonds by defendant, which bonds had been contained in a recently stolen automobile, is sufficient to allow an inference that defendant stole both the bonds and the automobile. Dickey v. State, 32 Ala. App. 413, 26 So. 2d 532 (1946). Likewise, the chancellor could properly infer theft of the whole amount from proof of theft of the smaller amount.
Indeed, this Court has stated in a case involving proof of causation: "It is not necessary, under Pennsylvania law, that every fact or circumstance point unerringly to liability; it is enough that there be sufficient facts for the jury to say reasonably that the preponderance favors liability. . . . Therefore, when a party who has the burden of proof relies upon circumstantial evidence and inferences reasonably deducible therefrom, such evidence, in order to prevail, must be adequate to establish the conclusion sought and must so preponderate in favor of that conclusion as to outweigh in the mind of the factfinder any other evidence and reasonable inferences therefrom which are inconsistent therewith." Smith v. Bell Telephone Company of Pennsylvania, 397 Pa. 134, 138-139, 153 A.2d 477, 480 (1959). Accordingly, the award of the chancellor was quite properly based on the evidence adduced.
Decree affirmed at appellant's cost.
Mr. Justice JONES took no part in the consideration or decision of this case.
DISSENTING OPINION BY MR. JUSTICE ROBERTS:
Unanimous and recent decisions of this Court have held that claims against a decedent's estate must be established by evidence that is "clear, direct, precise and convincing," Petro v. Secary Estate, 403 Pa. 540, 170 A.2d 325 (1961); Petruzzi Estate, 410 Pa. 554, 190 A.2d 314 (1963) (per curiam). The evidence relied upon by the Court to establish the $9,100 claim against *171 the decedent's estate does not fit that formulation; more importantly, the Court's opinion completely ignores a well established and sound precedent and, instead, permits recovery of the $9,100 solely on the basis of inferences from circumstantial evidence, citing as authority therefor a standard of proof enunciated in a negligence case. Needless to say, the standard of proof in negligence is irrelevant to the instant determination. The Alabama criminal case relied upon by the Court is also inapposite, as well as distinguishable. There is no reason why an Alabama decision in a different branch of the law should disturb a well established and sound rule of Pennsylvania law.
I therefore dissent and would reverse the decree insofar as it awards to the appellee the $9,100 not traceable by serial numbers to the defendant's decedent's estate or established by other evidence that is "clear, direct, precise and convincing."
Mr. Chief Justice BELL joins in this dissenting opinion.
NOTES
[1] This ruling was correct inasmuch as decedent's depositions were offered in evidence by plaintiff rather than by defendant. In Rosche v. McCoy, 397 Pa. 615, 156 A.2d 307 (1959), we held that when the party who represents the interest of a decedent offers decedent's deposition in evidence, he has waived the Dead Man's Act and the surviving adverse party becomes competent to testify. We expressly cautioned practitioners therein that if the depositions of defendant-decedent were offered by plaintiff, that would not make plaintiff competent to testify. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534704/ | 813 S.W.2d 872 (1991)
James A. BUCK, Sr., Appellant,
v.
Ronald A. LEGGETT, Collector of Revenue, City of St. Louis, Respondent.
No. 73363.
Supreme Court of Missouri, En Banc.
July 23, 1991.
*873 William A. Shirley, Chesterfield, for appellant.
Anthony J. Sestric, St. Louis, for respondent.
ALMON H. MAUS, Special Judge.
In 1988, the assessed value of Parcel No. 3682-00-02900 of real property in the City of St. Louis was $11,000. In 1989, the assessed value of that parcel was raised to $50,700. In 1990, the assessed value was $19,600. Plaintiff James A. Buck, Sr., paid the 1989 real estate taxes of $3,892.75 based upon the assessed value of $50,700. He claims a refund under § 139.031.5 of that portion of the 1989 taxes resulting from a valuation in excess of $19,600. He asserts that portion of those taxes was "mistakenly or erroneously paid" within the meaning of § 139.031.5. The trial court rendered summary judgment against the plaintiff in his action against the Collector of Revenue of the City of St. Louis. The plaintiff appealed to this Court.
The plaintiff states his appeal presents the following questions.
"1) whether the laws of Missouri require a taxpayer to appeal an incorrect assessment, and to protest the taxes paid pursuant to a bill based on said incorrect assessment, to preserve the right of the taxpayer to recover the overpayment;
2) whether, in the instant situation, an assessment in the subsequent year may evidence that the assessor incorrectly assessed the property in the previous year; and,
*874 3) whether, in the instant situation, a refund should issue."
He contends that the answers to those questions require the construction of revenue laws of this state in this "case of first impression". Therefore, the plaintiff concludes, exclusive jurisdiction of his appeal is in this Court by reason of Mo. Const., art. V, § 3.
This case does involve the revenue laws of this state. However, as hereafter developed, the criteria for reaching the answers to those questions have been established by prior decisions of this Court. The answer to question 1) is "Yes" and the answers to questions 2) and 3) are "No". Those answers are found in cases such as B & D Inv. Co., Inc. v. Schneider, 646 S.W.2d 759 (Mo. banc 1983), and State ex rel. Council Apartments, Inc. v. Leachman, 603 S.W.2d 930 (Mo.1980).
"Given the establishment of such criteria, this appeal involves questions of application of a revenue law already construed by this Court and, therefore, jurisdiction of this appeal lies in the Eastern District of the Court of Appeals." Affiliated Med. Transport v. Tax Com'n, 741 S.W.2d 25, 27 (Mo. banc 1987).
"The conclusion regarding appellants' attempt to raise a constitutional issue would provide an adequate basis for transfer of this appeal to the Court of Appeals. However, in the interest of judicial economy, the appeal will be retained here. Rule 83.06. Foremost-McKesson, Inc. v. Davis, 488 S.W.2d 193, 196 (Mo. banc 1972)." Atkins v. Department of Bldg. Reg., Etc., 596 S.W.2d 426, 434 (Mo.1980). Much of what is written is redundant and is perhaps unnecessary except to rephrase the rationale of the cases establishing the controlling criteria.
The evidentiary material supporting and opposing the collector's motion for a summary judgment established there was "no genuine issue" concerning the following material facts. Rule 74.04. The plaintiff owns the real property located at 4223 Dr. Martin Luther King Drive and designated Parcel No. 3682-00-02900 in the City of St. Louis. For 1988, the assessed value of that real property was $11,000. As a part of a general reassessment the assessed value for 1989 was raised to $50,700. A "Notice of Change in Assessed Value" for 1989 was mailed to the plaintiff at 5157 Palm St., St. Louis, Missouri 63115. The real property taxes for 1989, calculated upon the basis of an assessed value of $50,700, were $3,892.75. Those taxes were paid without protest by Community Federal from an escrow fund that it held in connection with a loan secured by a deed of trust on that real property. Community Federal subsequently provided to the plaintiff a Mortgage Interest Statement for calendar year 1989. This Mortgage Interest Statement was addressed to plaintiff at 5157 Palm 2E [sic], St. Louis, MO XXXXX-XXXX and advised the plaintiff that Community Federal had paid real estate taxes for 1989 in the amount of $3,892.75. For 1990, the assessed value of the real property was $19,600. On August 20, 1990, the plaintiff made application to the Collector of Revenue of the City of St. Louis under § 139.031.5 for the refund of 1989 real estate taxes paid to the extent of $2,387.86. That figure was calculated upon the difference between the 1989 assessed value and the 1990 assessed value using the 1989 tax rate. In his application, the plaintiff asserted that a portion of 1989 real estate taxes in the amount of $2,387.86 had been "mistakenly or erroneously paid" within the meaning of § 139.031.5. The Collector of Revenue denied the application for a refund. By his petition in this action, the plaintiff seeks to recover that refund. As stated, the motion of the Collector of Revenue for a summary judgment in his favor was sustained.
To determine the scope of § 139.031.5, that section must be construed in context as a part of the statutory provisions for the assessment, levy and payment of taxes. Xerox Corp. v. Travers, 529 S.W.2d 418 (Mo. banc 1975). Moreover,
"[i]n construing a statute it is appropriate to take into consideration statutes involving similar or related subject matter when such statutes shed light upon the meaning of the statute being construed, even though the statutes are *875 found in different chapters and were enacted at different times." Citizens Elec. v. Dir. of Dept. of Rev., 766 S.W.2d 450, 452 (Mo. banc 1989).
From an overview of Chapters 137, 138 and 139, it is apparent that in regard to the facet of taxation under consideration, the legislature intends to provide a method whereby a taxpayer, who pursues his administrative remedy, may, under protest, pay taxes levied upon the basis of a disputed assessment and preserve his objection and thereby advise the taxing authority, with reasonable assurance, of the amount of its disposable revenue. See B & D Inv. Co., Inc. v. Schneider, supra.
It is clear that if a taxpayer with notice of an increase in assessed value of his property fails to exhaust his administrative remedy to question that increase, he cannot do so in any other proceeding. C & D Inv. Co. v. Bestor, 624 S.W.2d 835 (Mo. banc 1981). He cannot do so in an action to enjoin the collection of taxes based upon that increase. Cupples-Hesse Corporation v. Bannister, 322 S.W.2d 817 (Mo. 1959). Nor can he do so by paying his taxes under protest and suing to recover them under § 139.031.2. Westglen Village Associates v. Leachman, 654 S.W.2d 897 (Mo. banc 1983). This is true even if he asserts the increased assessment was unconstitutionally discriminatory. Westglen Village Associates v. Leachman, supra.
"Similarly, in a suit against the state for recovery of taxes, statutorily provided administrative procedures must be utilized exclusively, and must be followed to exhaustion even where constitutional claims are raised. Ellsworth Freight Lines, Inc. v. Missouri Highway Reciprocity Commission, 568 S.W.2d 521 (Mo. banc 1978). See, B & D Investment Company, Inc. v. Schneider, 646 S.W.2d 759, 762 (Mo. banc 1983) (where administrative remedies are adequate that remedy is ordinarily exclusive)...." Westglen Village Associates v. Leachman, 654 S.W.2d at 900.
By the same token, "[e]ven though a taxpayer has appealed an assessment to the State Tax Commission, to preserve the asserted error, the taxes, if paid, must be paid in compliance with § 139.031(1). Adcor Realty v. State Tax Com'n., 627 S.W.2d 604 (Mo. banc 1982); Xerox Corporation v. Travers, supra." B & D Inv. Co., Inc. v. Schneider, 646 S.W.2d at 763. (Emphasis added.)
"When a challenge is made to a tax assessment, the procedure as outlined in Xerox Corporation v. Travers, 529 S.W.2d 418, 422 (Mo. banc 1975), should still be followed. That procedure involves 1) paying taxes under protest and filing a statement with the collector, 2) within 90 days filing suit in circuit court, and, 3) if appeal is made to the Missouri State Tax Commission the taxpayer is to notify the collector and the circuit court to have that action stayed until the proceedings are finalized." Westglen Village Associates v. Leachman, 654 S.W.2d at 900. The plaintiff does not question the above principles. However, he asserts they are not applicable to his claim under § 139.031.5 because he had no notice of the increased assessment.
The statutory plan of taxation is a part of government. The officials administering that plan are obligated to follow the statutes. Yet, at least to some extent, landowners are held to know that all real property is assessed and taxed annually and bear some obligation to see that taxes on their property are paid each year. See Sutter v. Scudder, 110 Mont. 390, 103 P.2d 303 (1940), and Rains v. Teague, 377 So. 2d 924 (Miss.1979). This obligation is expressed by statute.
"Each tract of land or lot shall be chargeable with its own taxes, no matter who is the owner, nor in whose name it is or was assessed. The assessment of land or lots in numerical order, or by plats and a land list in alphabetical order, as provided in this chapter, shall be deemed and taken in all courts and places to impart notice to the owner or owners thereof, whoever or whatever they may be, that it is assessed and liable to be sold for taxes, interest and costs chargeable thereon; and no error or omission in regard to the name of any person, with reference to any tract of land or lot, shall in any wise impair the *876 validity of the assessment thereof for taxes." § 137.170. (Emphasis added.)
This statute has been applied to hold that assessments of a described tract to a named individual not only included the surface but also all mineral interests held by others, none of whom were given notice of such assessments. Dorman v. Minnich, 336 S.W.2d 500 (Mo. banc 1960). This statute has not been further construed. The Collector of Revenue does not rely upon it. It need not be further considered except as an example of the fact that the doctrine of due process and notice in the field of taxation is, to some degree, unique.
"It must be borne in mind that the principles involved in due process of law as applied to proceedings for the collection of public revenue by taxation are more summary in character and necessarily less formal than those applicable to cases of a judicial character." 72 Am. Jur.2d, State & Local Taxation, § 782, at p. 100.
The plaintiff's argument is premised upon a statutory requirement of notice of an increase in assessed value.
"Whenever any assessor shall increase the valuation of any real property he shall forthwith notify the record owner of such increase, either in person, or by mail directed to the last known address; every such increase in assessed valuation made by the assessor shall be subject to review by the county board of equalization whereat the landowner shall be entitled to be heard, and the notice to the landowner shall so state." § 137.180. (Emphasis added.)
Section 137.490 contains a similar provision. Those statutes provide for notice "by mail directed to the last known address". There is authority that, even if this provision is construed as mandatory, this requirement is satisfied when such notice has been placed in the mail, whether or not received by the taxpayer. County Treasurer v. LaSalle-Lake Investors, 62 Ill. Dec. 458, 106 Ill.App.3d 451, 436 N.E.2d 40 (1982); Southern Tier Pizza Hut, Inc. v. Bailey, 113 Misc. 2d 37, 448 N.Y.S.2d 406 (1982). A similar statute expressly so provides. Turner v. Lansing Tp., 108 Mich. App. 103, 310 N.W.2d 287 (1981). This proposition has been recognized in this state. Slay Warehousing Co., Inc. v. Leggett, 762 S.W.2d 63 (Mo.App.1988). However, the judgment of the trial court need not be sustained on that basis.
Where the issue is submitted to the finder of fact, notice of an increase in assessed value can be found to have been received upon the basis of a presumption of delivery of mail, even though a taxpayer denies receipt. Hughes v. Estes, 793 S.W.2d 206 (Mo.App.1990). See also United Missouri Bank of Kansas City v. March, 650 S.W.2d 678 (Mo.App.1983). However, a presumption cannot be the basis for sustaining the summary judgment denying the plaintiff's claim. The plaintiff's counter affidavit denies receipt of the notice. There is a genuine issue concerning the actual receipt of the mailed notice.
Nonetheless, even assuming § 137.490 requires actual receipt of a mailed notice, the fact that plaintiff did not receive that notice does not establish his right to a refund. Such notice is not declared to be a prerequisite to the power of the assessor to increase an assessment. The failure of the assessor to give the statutory notice may deny a taxpayer an opportunity to exhaust his administrative remedy to contest that increase before the Board of Equalization and the State Tax Commission. In such circumstances, a taxpayer may enjoin the collection of taxes based upon the increase. John Calvin Manor, Inc. v. Aylward, 517 S.W.2d 59 (Mo.1974); United Missouri Bank of Kansas City v. March, supra; Ingels v. Noel, 804 S.W.2d 808 (Mo.App.1991).[1] But, it does not follow that a taxpayer can, without protest, pay taxes based on the increased assessment and then seek recovery of such taxes.
*877 Ad valorem taxes on real property for each year are calculated and extended in a book that sets forth the assessed value of each tract. See § 137.215 and § 137.225. That assessed value is shown upon tax statements that, upon payment, become tax receipts. See § 137.520 and § 139.090. Upon payment, the taxpayer is charged with knowledge of the assessed value upon the basis of which the taxes are to be paid.
The taxpayer then, charged with notice, has a choice. He can choose to enjoin the collection of such taxes. Or, he can pay those taxes. However,
"[i]n the absence of statutory authority, taxes voluntarily, although erroneously paid, albeit under an unconstitutional statute, cannot be refunded." Com. Fed. Sav. & Loan v. Director of Rev., 752 S.W.2d 794, 797 (Mo. banc 1988). (Emphasis added.)
The legislature has provided a means whereby the taxpayer may establish his payment of the taxes is not voluntary, but is under duress. That means is provided by § 139.031.1. A taxpayer's failure to follow the mandate of that subsection has consistently been held to bar his claim of impropriety of any part of the taxes he has paid. That is demonstrated in State ex rel. Council Apartments, Inc. v. Leachman, supra, in which the taxpayer sought to assert the exempt status of its property. It is demonstrated in Westglen Village Associates v. Leachman, supra, in which the taxpayer sought to assert an allegedly excessive assessment was constitutionally invalid.[2] That principle bars the plaintiff from obtaining a refund of any portion of the 1989 taxes he paid, unless such a refund is expressly authorized by another statutory provision. See Community Federal S & L v. Dir. of Revenue, 796 S.W.2d 883 (Mo. banc 1990).
The plaintiff contends that § 139.031.5 expressly authorizes his recovery.
"All the county collectors of taxes, and the collector of taxes in any city not within a county, shall, upon written application of a taxpayer, refund any real or tangible personal property tax mistakenly or erroneously paid in whole or in part to the collector, or shall credit against the taxpayer's tax liability in the following taxable year any real or personal property tax mistakenly or erroneously levied against the taxpayer and collected in whole or in part by the collector...." § 139.031.5. (Emphasis added.)
Plaintiff focuses upon the words "mistakenly or erroneously paid". He argues that because he did not "forthwith" receive notice of the increased assessment for 1989, the taxes based upon the increase were illegally levied. Therefore, he concludes they were "erroneously paid". He also appears to contend that as the 1989 taxes, based upon the increased assessment, were paid by the mortgage company, they were "mistakenly paid".
Section 136.035, applicable to taxes "which the state is authorized to collect", provides for the refund of any overpayment or "erroneous payment" of any tax. In holding that § 136.035 is applicable to the recovery of a constitutionally invalid tax, it was said:
"A reasonable construction of the terms `overpayment' and `erroneous' as used in section 136.035 includes the term `illegal' as seen from other interpretations by this Court, the plain meaning of the language and the definition in Black's Law Dictionary." Com. Fed. Sav. & Loan v. Director of Rev., 752 S.W.2d at 798.
That definition does not aid the plaintiff. Even assuming notice by mail of the increased assessment was not forthwith given or received, that deficiency does not establish any portion of the plaintiff's 1989 taxes was an illegal tax.
*878 Similar statutes in other states have been construed. "The phrase `erroneously or illegally charged,' as used in statutes providing for a refund of taxes so exacted, is held to refer to a jurisdictional defect as distinguished from a mere error of judgment, and it is generally held that no recovery of taxes paid under protest can be had under such statutes on the theory that there has been a mistake in the valuation of the property, which resulted in an excessive assessment...." 72 Am.Jur.2d, State & Local Taxation, § 1066, p. 331. An excessive assessment does not result in an illegal tax. Annot., "Excessive assessments as within contemplation of statute providing for refunding of taxes `erroneously or illegally charged'", 110 A.L.R. 656 (1937).
Section 137.270 demonstrates the proper characterization of an excessive assessment. A similar statute is applicable to the Comptroller of the City of St. Louis.
"The county commission of each county may hear and determine allegations of erroneous assessment ... before the taxes are paid[.] ... Valuations placed on property by the assessor or the board of equalization shall not be deemed to be erroneous assessments under this section." § 137.270. (Emphasis added).
The plaintiff was charged with notice of the increased valuation before the taxes were paid. He had alternative remedies available and chose neither.[3] No portion of the tax paid upon the basis of an alleged overassessment was an illegal tax.
Nor can the plaintiff successfully claim the 1989 taxes were mistakenly paid within the meaning of that statute because he would have protested the increase but the mortgage company mistakenly paid the taxes. This contention has also been previously decided adversely to the plaintiff.
"The trial court judicially noticed that real estate taxes are frequently paid by third party financial institutions (HUD here), rendering it difficult for the taxpayer to file his protest at the time his taxes are paid. Assuming arguendo that such fact may be judicially noted, see, State ex rel. National Lead Co. v. Smith, 134 S.W.2d 1061, 1068 (Mo.App. 1939), that fact cannot justify the court's conclusion. The taxpayer would be well advised to inquire of its lending institution or agency authorized to act in its behalf of the time and plan for payment...." State ex rel. Nat. Inv. Corp. v. Leachman, 613 S.W.2d 634, 635 (Mo. banc 1981).
The mortgage company paid the taxes in question and, so far as the Collector of Revenue is concerned, the plaintiff is bound by the action of the mortgage company.
Nor is the plaintiff aided by Crest Communications v. Kuehle, 754 S.W.2d 563 (Mo. banc 1988). The taxes in that case were based upon lists of real and personal property upon which the taxpayer valued its property.[4] For the year 1985, the taxpayer was notified its valuation was increased. The taxpayer promptly protested the increase and appealed to the Board of Equalization and then to the State Tax Commission. While that appeal was pending, the taxpayer's valuation for 1986 was, without notice, similarly increased. The taxpayer paid the 1986 taxes based upon that increase. The State Tax Commission subsequently reduced the increased valuation. In Crest, the taxpayer exhausted its administrative remedy and complied with § 139.031. It had properly initiated a proceeding that resulted in a determination the increased assessment was excessive. Upon the basis of these unique facts, the taxpayer's petition for a partial refund of the 1986 taxes under § 139.031.5 was found to have been improperly dismissed. Crest is not applicable to the facts of this case.
*879 The Collector of Revenue properly denied the plaintiff's claim for a refund. The summary judgment rendered by the trial court is affirmed.
ROBERTSON, C.J., RENDLEN, COVINGTON, HOLSTEIN and BLACKMAR, JJ., and HIGGINS, Senior Judge, concur.
NOTES
[1] Late notice of an assessor's denial of reconsideration of the exempt status of property may provide a basis for a late appeal to the Board of Equalization and the State Tax Commission. Lake St. Louis Com. Ass'n v. Tax Com'n, 759 S.W.2d 843 (Mo. banc 1988).
[2] Naegele Outdoor Advertising Co., Inc. v. Kansas City, 509 S.W.2d 128 (Mo.1974), is not apposite. In that case the city, contrary to a constitutional provision, levied taxes upon the basis of its assessment, which was higher than that of the county. The taxpayer was not, upon payment of the city taxes, held to notice of the county assessment. The city taxes were found to have been paid under duress and the taxpayer was permitted to recover the city taxes paid resulting from the constitutionally invalid assessment.
[3] Taxes on property subsequently determined to be exempt, paid without protest, were not erroneously or mistakenly paid. State ex rel. Council Apartments, Inc. v. Leachman, 603 S.W.2d 930 (Mo.1980).
[4] The section providing for the taxpayer to place a value on listed property, often disregarded in practice, has been amended to eliminate such provision. § 137.120, amended by L.1989, H.B. Nos. 181 & 633, § A. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534728/ | 251 B.R. 554 (2000)
In re Kari Kristin WEBBER, Debtor.
No. 00-2817-PHX-RJH.
United States Bankruptcy Court, D. Arizona.
August 9, 2000.
*555 Mark Johnson, Mesa, AZ, for Debtor.
Mary Ellen Beardsley, Assistant Attorney General, Office of the Attorney General, Anchorage, AK, for Alaska Commission on Postsecondary Education.
Madeleine C. Wanslee, Gust Rosenfeld, P.L.C., Phoenix, AZ, for United Student Aid Funds and Educational Credit Management Corporation.
Ralph McDonald, Phoenix, AZ, Chapter 13 Trustee.
OPINION
RANDOLPH J. HAINES, Bankruptcy Judge.
May a chapter 13 plan provide that repayment of the debtor's student loans would constitute an undue hardship, and consequently upon successful completion of all plan payments the debtor's student loan debts will not be excepted from the discharge? This Court concludes such plan provisions are improper.
Factual Background
Debtor Kari Webber filed a chapter 13 plan, through counsel, which provided in paragraph 3(j)(2)(A):
DISCHARGE OF STUDENT LOANS Kari Webber can not maintain based on current income and expenses, a minimum standard of living if forced to repay student loans. She has made *556 good faith efforts to repay the loans. State of affairs is likely to persist for a significant portion of the student loan repayment period. Upon successful completion of the chapter 13, the student loans will not be excepted from discharge.
The State of Alaska, by the Alaska Commission on Postsecondary Education, the Education Credit Management Corporation, and the United Student Aid Funds, Inc. filed objections to confirmation of the chapter 13 plan, and specifically objected to its attempt to discharge their student loan debts in the confirmation process. The Court heard those objections on July 12, 2000. At the hearing, Debtor's counsel agreed to file an amended plan that eliminates the objectionable provision, but counsel for the objectors nonetheless requested a ruling on their objection due to the recurring nature of the problem.
Analysis
Government guaranteed student loan debts are generally not dischargeable unless failure to discharge them would pose an "undue hardship" on the debtor and the debtor's dependents. 11 U.S.C. § 523(a)(8). The Ninth Circuit has held that Congress' use of the adjective "undue" means that the hardship must be more than a mere hardship. United Student Aid Funds, Inc. v. Pena (In re Pena), 155 F.3d 1108, 1111 (9th Cir.1998), citing In re Brunner, 46 B.R. 752, 753 (S.D.N.Y. 1985), aff'd, 831 F.2d 395 (2d Cir.1987). To demonstrate undue hardship, a debtor must establish that: (1) the debtor cannot maintain, based on current income and expenses, a minimal standard of living if forced to repay the loans; (2) additional circumstances exist indicating that this state of affairs is likely to persist for a significant portion of the repayment period of the student loans; and (3) the debtor has made good faith efforts to repay the loans. Pena, 155 F.3d at 1111.
The language of Debtor's plan was obviously drafted to satisfy that Pena standard, but Debtor did not seek to establish those facts through an adversary proceeding. Federal Rule of Bankruptcy Procedure (hereinafter "Bankruptcy Rule") 7001(6) requires that such a determination be made in the context of an adversary proceeding, and Bankruptcy Rules 7003 and 7004 require that such adversary proceeding be commenced by the filing of a complaint and service of a summons.
Yet despite the lack of an adversary proceeding, if the plan were confirmed as drafted, the discharge of the student loans could not be challenged in a collateral proceeding, because the confirmation order would have res judicata effect, even if the offending provision violated the Bankruptcy Code or Rules. Great Lakes Higher Educ. Corp. v. Pardee (In re Pardee), 193 F.3d 1083, 1086-87 (9th Cir. 1999); Andersen v. UNIPAC-NEBHELP (In re Andersen), 179 F.3d 1253 (10th Cir.1999); United States v. Black (In re Black), No. 99-0267, 2000 U.S.Dist. LEXIS 5880 (D.Ariz. March 30, 2000). To avoid that result the governmental student loan agencies must monitor and affirmatively object to chapter 13 plans that contain such provisions, instead of awaiting the service of a summons and complaint seeking to establish the debtor's undue hardship.
Because such objections were duly filed here, this is not a collateral attack on a confirmation order, but rather a timely and proper direct objection. Therefore the holdings of Pardee and Andersen have no bearing. The Ninth Circuit's Pardee opinion expressly declined to decide the issue of the propriety of the plan provision discharging postpetition interest on student loans, although it noted the clear weight of authority was that such interest was nondischargeable. 193 F.3d at 1085 and n. 4. The Tenth Circuit stated in Andersen that the discharge provision "did not comply with the Code," 179 F.3d at 1259, but that was dictum given the holding based on res judicata.
A handful of bankruptcy court decisions have condemned such attempts to discharge *557 student loans by plan provisions that, if not objected to, would obviate the necessity of an adversary proceeding to establish the undue hardship. Perhaps the earliest such case was In re Mammel, 221 B.R. 238 (Bankr.N.D.Iowa 1998), in which the plan simply provided that the student loan debts would be discharged upon confirmation. Upon the trustee's objection (but not that of the lenders), that court found seven reasons why such a provision was objectionable, but most of them do not apply here. The most obvious objection to the Mammel plan provision was that it violated 11 U.S.C. § 1328 by purporting to discharge student loan debts immediately upon confirmation rather than upon completion of all plan payments. 221 B.R. at 240-41. That provision also constituted unfair discrimination in violation of § 1322(b)(1), because such immediately discharged debts would presumably not share pro rata in the payments made on other unsecured debts during the life of the plan. Id. at 242. Neither of these problems exists with the Webber plan provision, because it purports to discharge the student loan only upon completion of the plan, the same as other unsecured debt. The Webber provision also alleviates the problem the Mammel court found with a simple discharge provision that evades the Debtor's burden of proof under § 523, because the Webber provision seeks to establish, in the confirmation process, the facts necessary to support the finding of undue hardship under the applicable Ninth Circuit test. Consequently of all the objections found by the Mammel court, the only one significantly applicable here is that the plan provision is contrary to Bankruptcy Rule 7001(6) by evading the necessity of an adversary proceeding.
The court in In re Evans, 242 B.R. 407, (Bankr.S.D.Ohio 1999), condemned such plan provisions more strongly, relying primarily on the evasion of the adversary proceeding to establish the undue hardship. Among other things, that court noted that Bankruptcy Rule 7004(b)(4) and (5) establish special service procedures for service of adversary proceedings on agencies of the United States, which may not apply to the simple notice of the date to object to the plan. 242 B.R. at 410. The court also noted that it may be improper to attempt to establish undue hardship in the confirmation process, where a State's Eleventh Amendment immunity defense may not be as available as it might in an adversary proceeding. Id., n. 3. Ninth Circuit law recognizes that same distinction, In re Mitchell, 209 F.3d 1111 (9th Cir.2000), and the State of Alaska specifically makes that objection here.[1] The Evans court ordered debtor's counsel to show cause why the inclusion of the student loan discharge provision did not violate Bankruptcy Rule 9011, to deter the "abuse" of creating such a trap for unwary creditors and creating "discharge by declaration," akin to the exemption by declaration deplored in Taylor v. Freeland & Kronz, 503 U.S. 638, 644, 112 S. Ct. 1644, 118 L. Ed. 2d 280 (1992). 242 B.R. at 411-13.
The court in In re Conner, 242 B.R. 794 (Bankr.D.N.H.1999), similarly found such provisions objectionable, relying heavily on the fact that such plan provisions effectively shift the burden of going forward with the case for the hardship discharge. It held that the lending agencies should not be compelled to object to such plan provisions because they should be entitled to rely on the self-effectuating nature of § 523(a)(8), excepting such debts from discharge unless an adversary proceeding established the requisite undue hardship. 242 B.R. at 799. See also In re Hensley, 249 B.R. 318 (Bankr.W.D.Okla.2000); In re Fox, 249 B.R. 140 (Bankr.D.S.C.2000).
I concur that such student loan discharge provisions are not permissible in a chapter 13 plan or in an order confirming the plan. Bankruptcy Rule 7001(6) requires *558 an adversary proceeding to establish the dischargeability of such debts, and nothing in chapter 13 permits the Bankruptcy Rules to be evaded by simple plan provisions. See, e.g., Bear v. Coben (In re Golden Plan of Cal., Inc.), 829 F.2d 705 (9th Cir.1986) (fraudulent conveyances may not be avoided by the provisions of a chapter 11 plan without an adversary proceeding); Brady v. Andrew (In re Commercial W. Fin. Corp.), 761 F.2d 1329, 1336-38 (9th Cir.1985) (unperfected interests may not be avoided by a chapter 11 plan without an adversary proceeding). Some bankruptcy rules requiring adversary proceedings specifically provide for an alternative in the confirmation process, but Rule 7001(6) does not. See, e.g., Rules 7001(7) (plans may provide injunctive relief) and 7001(8) (plans may subordinate claims). It is not appropriate for debtors' counsel to submit such plans in the hope that the student lending agencies fail to object.
For these reasons, Debtor's counsel is directed to file an amended plan that eliminates the provision attempting to establish the basis for discharge of the student loans. This is without prejudice to the filing of an appropriate adversary proceeding to obtain a discharge of such debts.
NOTES
[1] This Court expresses no opinion as to whether the Alaska agency may properly assert Eleventh Amendment immunity against a proper proceeding seeking to discharge a student loan obligation or, if so, whether it would be permissible to evade that defense by seeking the relief in the confirmation process. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534725/ | 247 Md. 379 (1967)
231 A.2d 70
CHALMERS, ET VIR
v.
WILLIS
[No. 383, September Term, 1966.]
Court of Appeals of Maryland.
Decided July 5, 1967.
The cause was argued on May 4, 1967 before HAMMOND, C.J., and HORNEY, MARBURY, OPPENHEIMER and McWILLIAMS, JJ., and reargued on May 29, 1967 before HAMMOND, C.J., and HORNEY, MARBURY, OPPENHEIMER, BARNES, McWILLIAMS and FINAN, JJ.
George J. Goldsborough, Jr., (on both arguments) for appellants.
Dorothy H. Thompson (on both arguments), with whom was Ernest M. Thompson on the brief, for appellee.
OPPENHEIMER, J., delivered the majority opinion of the Court. HAMMOND, C.J., and HORNEY, and FINAN, JJ., dissent. Dissenting opinion by HAMMOND, C.J., at page 388, infra.
We are called upon to decide whether a friend, who accompanies a learning driver with only a learner's permit for the purpose of giving the driver instruction and help in learning to drive, must be held, as a matter of law, to have assumed the risk of injury in an accident in which no other vehicle and no unexpected emergency was involved and in which the only explanation *382 given of the accident was the conduct of the driver. The question is one of first impression in Maryland.
The facts are virtually undisputed. The appellants, Mr. and Mrs. Chalmers, and the appellee, Mrs. Willis, and her husband, were friends. Mrs. Chalmers is 43 years of age, Mrs. Willis is 53. Since about 1953, Mrs. Willis had been anxious to learn to drive, but, after one or two brief lessons, circumstances beyond her control and unrelated to her learning capacity, prevented her from pursuing her endeavor. In March of 1965, Mrs. Chalmers agreed, solely as an act of friendship, to teach Mrs. Willis how to drive. Mrs. Willis obtained a learner's license on March 31, 1965. The automobile owned by Mr. and Mrs. Willis was used for the lessons.
The first lesson, of about two hours duration, took place on Saturday, April 3. On that day, Mrs. Chalmers, behind the wheel, began the instructions with the rudiments of starting, stopping and steering. After about 45 minutes, Mrs. Willis took over. For an hour and a quarter to an hour and a half Mrs. Willis drove up and down a lane, and around a circle through an isolated and untraveled development known as Waverly Island Estates. Mrs. Chalmers testified that Mrs. Willis did "very well", had no difficulty and nothing occurred which suggested she was not "perfectly at ease behind the wheel."
On the next day, Sunday, April 4, Mrs. Chalmers gave Mrs. Willis the second lesson. Mrs. Willis took the wheel and drove from Waverly, where the Chalmers lived, to Oxford, a distance of at least ten miles, drove down a ramp or incline to a ferry slip, and then, after a stop for a cigarette, turned the car around and drove back through Oxford. Mrs. Willis testified that, in driving through the town, she encountered pedestrians, bicyclists, narrow roads and other cars, and had "absolutely no difficulty." She said nothing to Mrs. Chalmers to indicate she was nervous or unsure. During the two days, Saturday and Sunday, until the accident, Mrs. Willis testified that she had no difficulty or problem of any kind.
On the return trip from Oxford, Mrs. Willis, at the suggestion of Mrs. Chalmers, turned off the main road into a development known as Oaklands, where Mrs. Willis went in and "around and around" a circle and came out again without incident. *383 At the entrance to Waverly there are two brick pillars. Waverly Road, beyond the pillars, has a paved surface of 20 feet. Before making the left turn into Waverly Road, Mrs. Willis was instructed by Mrs. Chalmers with respect to observing traffic. Mrs. Willis testified that she momentarily stalled the car, but then started again and made the left-hand turn through the entrance pillars. She slowly started down Waverly Road, and the physical evidence indicates that she had proceeded at least 50 feet from the entrance pillars. She then drove off the road to her left into a shallow ditch and struck a telephone pole nine feet from the side of the road. No other vehicles were on the road, at least near the accident. Mrs. Willis' only explanation of the accident was that "I didn't pull my wheel back or let the wheel come back." Mrs. Chalmers tried, unsuccessfully, to prevent the collision.
During the two trips in which Mrs. Chalmers was instructing Mrs. Willis, Mrs. Willis had driven a total of approximately 40 miles before the accident. Nothing had happened during that time. Mrs. Willis testified that she had no momentary lapse of control, and nothing happened to demonstrate to her or to Mrs. Chalmers that she, Mrs. Willis, had any hesitancy about operating the car. Mrs. Willis testified further that, on the day of the accident, she had made "any number of similar turns." It was stipulated that Mrs. Willis, during the two days prior to the accident, had driven carefully and cautiously at all times.
Mrs. Chalmers and her husband brought suit in the Circuit Court for Talbot County for injuries sustained and losses incurred as a result of the collision. The case was tried before a jury. Mrs. Willis' motions for a directed verdict at the conclusion of the Chalmers' case and the entire case were denied. The trial judge instructed the jury, fully and carefully, on the issues of primary and contributory negligence. Mrs. Willis asked for no instructions as to assumption of risk. No exceptions were taken on behalf of Mrs. Willis to the charge, except as to the failure of the judge to rule as a matter of law that Mrs. Chalmers was not entitled to recover because she had assumed the risk of the accident. The jury returned a verdict for Mrs. Chalmers. Thereafter, on motion duly made by Mrs. Willis, the *384 judge granted judgment in her favor n.o.v. Mrs. Chalmers appealed; no cross-appeal was taken by Mrs. Willis. The only question before us, therefore, is whether the judgment n.o.v. was properly awarded.
The court below, in a memorandum opinion, held that the negligence of Mrs. Willis was imputed to Mrs. Chalmers, and that the "accident was caused by the inexperience and lack of skill of the learner driver which was a risk that the instructor clearly knew and fully understood when she agreed to act as such and ride in the car operated by the learner. Accordingly we rule that the plaintiff assumed the risk of this accident as a matter of law and is precluded from recovery for that reason."
In Slutter v. Homer, 244 Md. 131, 139-40, 223 A.2d 141 (1966), we referred to the criticisms of the imputed negligence theory as unrealistic and fictitious, and characterized it as a "controversial doctrine." In any case, however, that doctrine is not here applicable. Whatever effect the doctrine may have as to third parties, it is inapplicable as between the parties engaged in a common enterprise. Powers v. State, Use of Reynolds, 178 Md. 23, 29-31, 11 A.2d 909 (1940); Restatement, Torts, Second, § 491.
While no issue of imputed negligence is involved, the question of whether the plaintiff is barred from recovery, because she assumed the risk of what happened as a matter of law, is a close one. This Court has consistently recognized that while, in some cases, there is an overlapping between contributory negligence and assumption of risk, there is a distinction between the two. Baltimore County v. State, Use of Keenan, 232 Md. 350, 359-60, 193 A.2d 30 (1963), and cases therein cited. In Gibson v. Beaver, 245 Md. 418, 226 A.2d 273 (1967), Chief Judge Hammond, for the Court, quoted Prosser, Torts, § 55, p. 303 (2d ed. 1955), as follows:
"The defense of assumption of risk rests upon the plaintiff's consent to relieve the defendant of an obligation of conduct toward him, and to take his chances of harm from a particular risk. Such consent may be found: * * * by implication from the conduct of the *385 parties. When the plaintiff enters voluntarily into a relation or situation involving obvious danger, he may be taken to assume the risk, and to relieve the defendant of responsibility. Such implied assumption of risk requires knowledge and appreciation of the risk, and a voluntary choice to encounter it."
and said:
"In determining whether a plaintiff had knowledge and appreciation of the risk, an objective standard must be applied and a plaintiff will not be heard to say that he did not comprehend a risk which must have been obvious to him." 245 Md. at 421.
As in the case of contributory negligence, when the undisputed facts permit only one reasonable conclusion, we have approved the granting of a summary judgment or the direction of a verdict because we found, as a matter of law, that the plaintiff had assumed the particular risk. Gibson, and cases cited therein at 245 Md. 422. However, again as with contributory negligence, the issue of whether the plaintiff had assumed the risk is generally one for the trier of the facts. E.g., Keenan, supra, at 232 Md. 366-67; Velte v. Nichols, 211 Md. 353, 356-57, 127 A.2d 544 (1957); Bull Steamship Lines v. Fisher, Use of Globe Indemn. Co., 196 Md. 519, 526-27, 77 A.2d 142 (1950). See also, Williamson Truck Lines, Inc. v. Benjamin, 244 Md. 1, 222 A.2d 375 (1966); Restatement, Torts, Second, § 496; Prosser, op. cit. supra, § 67, at 453-54.
In this case, two questions are involved: first, whether a plaintiff helping a driver whom the plaintiff knows has only a learner's permit is barred, as a matter of law, from recovery against the driver for injuries sustained in an accident in which the inexperience of the driver plays a part; and, second, if that question is answered in the negative, whether the court below was correct in holding that the appellant was barred from recovery as a matter of law, because of the assumption of risk, on the evidence in the case and in the posture in which the case comes to us.
On the first question, courts in other jurisdictions are divided. *386 New York and Kentucky hold that one who is licensed to operate a motor vehicle and who voluntarily accompanies a driver for the purpose of teaching him to drive, assumes the risk of the learner's inexperience and may not recover damages for personal injuries caused by the lack of skill or inexperience of the learner. Richards v. Richards, 324 S.W.2d 400 (Ky. 1959); Spellman v. Spellman, 309 N.Y. 663, 128 N.E.2d 317 (1955); LeFleur v. Vergilia, 280 A.D. 1035, 117 N.Y.S.2d 244 (1952); Aloisio v. Nelson, 27 Misc. 2d 343, 209 N.Y.S.2d 674 (Sup. Ct. 1961).[1] On the other hand, Massachusetts, South Dakota, California, Louisiana and Pennsylvania hold that a licensed operator riding with a person who possesses only an instruction permit does not assume the risk of the driver's negligence as a matter of law; whether there has been such an assumption is a question of fact. Holland v. Pitocchelli, *387 299 Mass. 554, 13 N.E.2d 390 (1938); Jennings v. Hodges, 129 N.W.2d 59 (S.D. 1964); Roberts v. Craig, 124 Cal. App. 2d 202, 268 P.2d 500 (1954); Constantin v. Bankers Fire & Marine Ins. Co., 129 So. 2d 269 (La. App. 1961); Joyce v. Quinn, 204 Pa. Super. 580, 205 A.2d 611 (1964).
We agree with the latter decisions. In our opinion, the better rule is that the person helping the learner-driver does not, as a matter of law, assume the risk of anything that may happen to him as the result of an accident in which the driver's inexperience plays a part. Rather, we think the questions are whether the plaintiff assumed the particular kind of risk involved, the degree of incompetence or inexperience of the driver which, on the facts, should reasonably have been anticipated by the plaintiff, and whether, given the driver's experience in the act or omission which caused the accident, the driver may properly be held negligent, despite his inexperience. Where these questions are involved, as we believe they are in the present case, then we think the question of whether the plaintiff assumed the risk of the driver's conduct under all the circumstances, in which inexperience is included, is one for the trier of the facts.
Some of the cases indicate a distinction between the position of a plaintiff who is merely accompanying the driver-learner because of a statutory requirement and one who is actively assisting the driver. This distinction, we think, is one of the factors which may be considered by the trier of the facts, in that the first situation may indicate the plaintiff's confidence that the driver, because of prior experience, is reasonably competent, but we do not believe this factor, of itself, should be determinative. In Holland v. Pitocchelli, supra, and Constantin v. Bankers Fire & Marine Ins. Co., supra, the plaintiff was instructing the driver, and in Roberts v. Craig, supra, although the plaintiff was not in the usual role of an instructor, she was giving actual assistance at the time of the accident.
In the case before us, Mrs. Willis had driven, with Mrs. Chalmers instructing her, on two successive days, in various kinds of traffic and with no previous incident or compelling reason for Mrs. Chalmers to feel that she could not competently respond to the ordinary requirements of steering the automobile. *388 The accident occurred because Mrs. Willis, after making a left-hand turn, did not let the wheel come back or pull it back. The evidence is uncontested that she had made a number of similar left-hand turns during her previous driving of 40 miles without difficulty. Under these circumstances, the jury, if the question of assumption of risk had been submitted to it, could reasonably have found that Mrs. Willis' previous experience in the kind of situation with which she was confronted was sufficient to make her failure to turn the wheel negligent, despite her inexperience, and that Mrs. Chalmers, at the time of the accident, was not assuming the risk of Mrs. Willis' sudden ineptitute or negligence in the single act involved.
The verdict of the jury necessarily was based on a finding that Mrs. Willis was negligent. Mrs. Willis did not ask the court below to instruct the jury on the issue of assumption of risk, and took no exception to the court's failure to do so. She asked only for a directed verdict, and later for judgment n.o.v. For the reasons given, we find that the judgment n.o.v. was improperly awarded. Accordingly, judgment must be given for Mrs. Chalmers on the jury's verdict.
Judgment reversed; case remanded for entry of judgment for appellants in accordance with verdict of jury; costs to be paid by appellee.
HAMMOND, C.J., dissenting:
I accept the majority's statement of the facts with only minor additions later mentioned, but I cannot accept their conclusion. Although the precise question here involved is one of first impression in Maryland the application of well-established rules regarding the assumption of risk and causation leads me to conclude that as a matter of law there was an assumption by Mrs. Chalmers of the risk of misfortunes which might result from Mrs. Willis' inexperience, and that the risk assumed was the cause of the accident which resulted in Mrs. Chalmers' injury.
The doctrine of assumption of risk rests upon the plaintiff's express or implied consent to encounter a known risk, which *389 relieves the defendant of an obligation of conduct with regard to that risk or results in the abandoning in advance of the right to complain of harm flowing from the consequences of the risk incurred. It refers to the situation in which the plaintiff with full knowledge of the risk voluntarily enters into some relation with the defendant involving danger to the plaintiff through the defendant's conduct. Gibson v. Beaver, 245 Md. 418; Bull Steamship Lines v. Fisher, 196 Md. 519, 524-25; Warner v. Markoe, 171 Md. 351, 359-60. If the defect or danger which creates the risk is obvious, knowledge is presumed. Gibson v. Beaver, supra; Le Vonas v. Acme Paper Board Co., 184 Md. 16, 20; Gordon v. Maryland State Fair, Inc., 174 Md. 466, 468-69. In the Gibson case we stated: "In determining whether a plaintiff had knowledge and appreciation of the risk, an objective standard must be applied and a plaintiff will not be heard to say that he did not comprehend a risk which must have been obvious to him." (p. 421)
Here, Mrs. Chalmers expressly agreed and undertook to teach Mrs. Willis to drive. It is obvious that Mrs. Chalmers regarded Mrs. Willis as a complete novice since for the initial lesson the teacher took the pupil to an out-of-the-way, "uninhabited" area where there was no traffic and began by teaching her the most basic fundamentals stopping, starting, and steering. On the second day, the teaching continued and immediately prior to the accident Mrs. Chalmers gave instructions on looking for traffic and using the mirror before making turns. Continuous driving instruction is not ordinarily given to a driver in whose driving skill and experience one has confidence. Having thus demonstrated her appreciation of Mrs. Willis' inexperienced state down to the moment of the accident and having acted as she did in light of that inexperience, Mrs. Chalmers cannot be heard to deny her awareness of the specific dangers which might flow from Mrs. Willis' inexperience. The fact that Mrs. Willis had driven without incident for a total of some 30 to 40 miles over a two-day period did not render her an experienced driver. Inexperience in driving, by its very nature, is only eliminated slowly and by degrees. It is not totally or even significantly eliminated by 30 to 40 miles of safe driving. Legislative recognition of this fact has been given in recently enacted Ch. 717 *390 of the Laws of 1967, amending Art. 66 1/2, § 88 (1), to require that persons under 18 years of age applying for operator's licenses have at least 30 hours of classroom and 6 hours of in-car approved professional driving instruction. It also might be noted that this age group is probably one where the development of effective reflexes in driving would be somewhat more rapid than average. Some of the hazards of driving instruction have also been recognized by the Legislature, which in Code (1965 Repl. Vol.), Art. 77, § 212 (4), requires that cars used in school driver training programs "bear a red flag clearly visible from both front and rear" to warn the public. It is common knowledge that other "driver training" cars also frequently have signs warning that the driver is a learner and dual controls which, it might be noted, would have avoided the misfortune involved in this case. We think that the conclusion is compelled that Mrs. Chalmers must have appreciated Mrs. Willis' continuing inexperience and its potential consequences, and consented to assume the risk of misfortunes caused by this inexperience.
It is also plain that the only reasonable inference which can be drawn from the evidence is that the accident was the result of inexperience. It is agreed that Mrs. Willis had been driving carefully within the limits of her competence, and there is no evidence of inattentiveness, speed or distraction on her part at the time of the accident.[1] The turn was Mrs. Willis' first left turn between pillars and into a somewhat narrow road. The testimony indicates that most of her driving over the two days had been over straight roads and around circles, with relatively few left turns. In any event, even two days of making an ordinary number of turns would not make Mrs. Willis experienced in this respect. More than two days is required to learn to react instinctively to various driving situations. In the absence of some explanation such as inattentiveness, speed, distraction, or some peculiar physical condition of the road or the car, the only conclusion to be drawn is that Mrs. Willis lacked the instinctive reactions which an experienced driver would have and *391 that her failure to let the wheel come back or to pull the wheel back was the result of this inexperience. Under the circumstances, no attentive, experienced driver would have failed to instinctively pull the wheel back properly. Mrs. Willis' failure to do so, due to her lack of experienced instinctive reactions, was the cause of the accident and was precisely the type of risk which Mrs. Chalmers had assumed.
We have held that the doctrine of assumption of risk should be applied, as a matter of law, in cases such as this where the undisputed evidence and all permissible inferences deducible therefrom clearly establish that the risk of the danger which causes the accident was fully known to and understood by the plaintiff whose consent thereto may be implied. Gibson v. Beaver, supra; Evans v. Johns Hopkins University, 224 Md. 235; Velte v. Nichols, 211 Md. 353.
Our conclusions are supported by the decisions in other jurisdictions involving a plaintiff instructing an inexperienced operator. The general rule is stated in 8 Am.Jur.2d, Automobiles, § 539, p. 98:
"Generally, one who is licensed to operate a motor vehicle, and who voluntarily accompanies a driver who has just received a learner's permit for the purpose of teaching him to drive, assumes the risk of the learner's inexperience and may not recover damages for personal injuries caused by the lack of skill or inexperience of the learner."
One of the cases supporting this statement is Richards v. Richards (Ky.), 324 S.W.2d 400. In that case, on the second day of driving instruction, the learner "put his foot `too hard' on the accelerator and lost control of the car" which hit a tree. Holding that the question of assumption of risk was not for the jury because the instructing brother was injured in an accident clearly caused by the inexperience of the learning brother, the Court said:
"Allen knew his brother Edgar was without experience in operating a modern car. Thus, Allen assumed a risk when he got in the car with his brother and undertook to teach him to drive. * * *
*392 "It cannot be said this accident was caused by Edgar's negligence. It was obviously caused by his inexperience in the proper handling of the mechanical controls. * * * This is exactly the situation a person must anticipate when he undertakes to teach another how to drive. This is the risk he assumes." 402
The Courts of New York have adopted the same view in Spellman v. Spellman, 128 N.E.2d 317; Le Fleur v. Vergilia (App. Div.), 117 N.Y.S.2d 244; Aloisio v. Nelson (Supr. Ct.), 209 N.Y.S.2d 674, 675; St. Denis v. Skidmore (App. Div.), 221 N.Y.S.2d 613. In Aloisio the Court, citing Spellman and Le Fleur, stated: "A licensed operator who accompanies an operator possessing only a learner's permit in order to instruct that unlicensed operator, assumes the risk of the permittee's inexperience, and cannot recover damages for injuries caused by that inexperience or lack of skill."
As suggested by the majority, there are other cases which allow the question of assumption of risk to go to the jury when there is evidence that the injured passenger was merely accompanying the driver to satisfy a statutory requirement and was not giving instruction. Turner v. Johnson (Ky.), 333 S.W.2d 749; Jennings v. Hodges (S.D.), 129 N.W.2d 59; Roberts v. Craig (Cal.), 268 P.2d 500. One explanation for the distinction which is made between these cases and those where instruction is being given may arise from the evidentiary effect of the giving of instruction. As we have noted, the giving of instruction is a clear indication of appreciation of the lack of skill and experience of the driver. When no instruction is being given, the facts as to the accompanier's appreciation of the risk ordinarily may be more in dispute and therefore for the jury. In Turner, for instance, the questions of whether the claimant was a teacher or a mere passenger and whether the claimant knew the driver was inexperienced were disputed matters of fact. The other cases cited also involved jury questions as to whether the conduct of the novice driver was the result of inexperience or negligence.
I would affirm. Judge Horney and Judge Finan have authorized me to say that they concur in my view of the case.
NOTES
[1] In Corbett v. Curtis, 225 A.2d 402 (Me. 1967), the plaintiff was accompanying the defendant, who was driving under a learner's permit. There was a statutory requirement that learners could operate cars only under the supervision and instruction of a licensed operator. As the defendant was driving the car over a wooden bridge, it suddenly veered to the right and dropped into the river below. No explanation was given as to how the accident occurred. The jury gave a verdict for the plaintiff; a motion of the defendant for judgment n.o.v. was denied. The judgment for the plaintiff was affirmed. The Supreme Judicial Court held that, on the facts, the rule of res ipsa loquitur could be applicable, and the jury apparently so found. The court said further that there was no sufficient evidence that any lack of skill or inexperience on the part of the defendant was the proximate cause of the accident. In discussing the law, the court said:
"The weight of authority holds that a person riding with an unlicensed operator for the purpose of instructing him in the operation of the car assumes the risk of injury if it is occasioned by the lack of skill and experience of the driver. This is not so, however, if the action results from an act of negligence on the part of the driver not attributable to his lack of skill or experience. When a person enters a car for the purposes of supervising and assisting one in possession of a learner's permit to practice driving, and also to satisfy the requirements of Sec. 537, he is not as a matter of law subject to the rule of assumption of risk * * * The assumption of risk under the circumstances of the instant case is a jury question." 225 A.2d at 408.
[1] The appellant did not undertake to prove negligence on a res ipsa loquitur theory as apparently was done in Corbett v. Curtis (Me.), 225 A.2d 402. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534724/ | 813 S.W.2d 570 (1991)
Ex parte Jay Allen WALKER, Applicant.
No. 13-90-445-CR.
Court of Appeals of Texas, Corpus Christi.
July 25, 1991.
Discretionary Review Refused October 2, 1991.
*571 Douglas Tinker, Corpus Christi, for applicant.
Grant Jones, Corpus Christi, for appellee.
Before DORSEY, KENNEDY, and SEERDEN, JJ.
OPINION
DORSEY, Justice.
On original submission, we held that an indictment pending against appellant placed him in double jeopardy and ordered the indictment dismissed. Although the State did not file a motion for rehearing, it filed a petition for discretionary review on July 18, 1991. We reconsider our decision pursuant to Tex.R.App.P. 101 and now conclude we do not have jurisdiction to hear appellant's complaint in light of the decision of the Court of Criminal Appeals in Ex parte Apolinar, No. 682-90 (Tex.Crim. App. June 19, 1991) (not yet reported). We withdraw our previous opinion and dismiss the appeal for want of jurisdiction.
On November 1, 1990, appellant filed a pleading, entitled "Defendant's Application for Writ of Habeas Corpus and Special Plea in Bar," under the cause number of the pending indictment. The record does not show that a writ of habeas corpus was issued. On November 12, the trial court heard evidence and argument and then stated that he "would overrule the special plea and would deny the double jeopardy claim." The case before us is an attempted appeal of that ruling of the trial court.
Whether the action of the trial court is the denial of a plea in bar or was the denial of relief under an application for writ of habeas corpus determines whether we have jurisdiction to review the court's decision.
A special plea may be used to assert a double jeopardy claim under Tex. Code Crim.Proc.Ann. Art. 27.05 (Vernon 1989). If such a plea is asserted under that article, all issues of fact are determined during the trial on the merits, so as to preclude the determination of double jeopardy in advance of trial. Apolinar, Slip Op. at 2; Keller v. State, 760 S.W.2d 816, 817 (Tex.App.Corpus Christi 1988, no pet.). The denial of a special plea in advance of trial is an interlocutory order and not a final judgment. The courts of appeal have not been granted jurisdiction over this sort of interlocutory order. Apolinar, Slip Op. at 2. Therefore, the special plea procedure authorized by Article 27.05 does not protect a defendant from being put to trial repeatedly for the same offense; its protection goes only to being repeatedly convicted.
Use of the pretrial writ of habeas corpus is the only way to protect a defendant's fifth amendment right against twice being put to trial. Apolinar, Slip Op. at 3. Moreover, a special plea cannot be construed to be a pretrial writ of habeas corpus. Apolinar, Slip Op. at 1-3.
There is nothing in the record showing that the trial court issued a writ of habeas corpus. See Tex.Code Crim. Proc.Ann. art. 11.10 et seq. (Vernon 1977). A trial court's ruling on an application for writ of habeas corpus is appealable only when the trial court issues the writ and then rules upon the merits of the issue presented. See, e.g., Ex parte Moorehouse, 614 S.W.2d 450, 451 (Tex.Crim.App. 1981). The issuance of the writ is the necessary first step for the trial court to hear the basis for the relief sought. There is no appeal from the refusal of the court to issue the writ. Ex parte Noe, 646 S.W.2d 230, 231 (Tex.Crim.App.1983).
Finding no writ of habeas corpus in the record, we conclude that the trial court did not act on the application for the writ. Therefore, the ruling went to appellant's plea in bar, which was the only other matter before the trial court in the hearing.
*572 The denial of the pretrial plea in bar is interlocutory and is not appealable absent a final judgment. Apolinar, Slip Op. at 1-3.
The appeal is dismissed for want of jurisdiction. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534731/ | 247 Md. 446 (1967)
231 A.2d 697
TAYLOR, ET UX.
v.
SOLTER, ET UX.
[No. 470, September Term, 1966.]
Court of Appeals of Maryland.
Decided July 13, 1967.
The cause was argued before HAMMOND, C.J., and MARBURY, OPPENHEIMER, BARNES and McWILLIAMS, JJ.
J. Francis Ford, with whom was C. Rider Brandau, on the brief, for appellants.
B. Conway Taylor, Jr., for the appellees.
McWILLIAMS, J., delivered the opinion of the Court.
This imbroglio has to do with a country road. Judge Turnbull held the appellees (the Solters) have a right to use it. Appellant[1] (Mrs. Taylor) disagrees. Before the contentions of the parties can be brought into focus it is necessary to know something of the history of the land through which the road meanders.
In January 1933 Granville Arrowood became the owner of 97.24 acres of land in Baltimore County lying just south of the Mason-Dixon line. In October of the same year he conveyed lot A (see plat made a part of this opinion) to Fisher. The *448 western boundary of lot A is described in the deed as binding on the east side of "a private road owned and used by" Arrowood. Fisher was also granted an "easement and right * * * to the use of said * * * [16 foot] private road * * * as now used by said [Arrowood]" as a means of ingress and egress to Fisher's property "located on both sides of said road." (At the time Fisher owned lot F which is not a part of the 97 acres.)
In August 1935 Arrowood conveyed lot B to Ray whose deed provides that he has a right to the use of a "private road[2] 16' wide belonging to and owned by * * * [Arrowood and] as now used by [him] located through the western part of the property described herein as a means of ingress and egress to the property of the grantees located and adjoining the within described property on the south side." Obviously grantees was intended to be "grantors."
In October 1938 Arrowood conveyed lot D to Lowe. The deed grants the right to use "especially the 16 foot right of way now laid out on the west side of the remaining property [lot C] of * * * [Arrowood]."
In November 1938 Arrowood conveyed lot C to Mathews. The deed provides that "a driveway 16 feet wide is hereby reserved for the benefit of the tract [lot D] recently sold to" Lowe.
Fisher is still the owner of lot A. The other lots have changed hands several times. The Taylors became the owners of lot B in December 1954. The Solters acquired lots C and D in November 1965. Shortly thereafter the Taylors installed a heavy chain across the road and secured it in place by a padlock. The Solters have no other access to their property from the public roads. Their bill for an injunction and a declaratory decree was filed 6 December 1965.
*449 Appellant concedes that the Solters have a right of way over lot B to the public roads. She contends, however, that their right of way is over a road that, at some unknown time in the past, was cut through the woods somewhere along the western boundary of her property (the Western Road). Except for the testimony of Jerome Hromadnik there is no evidence that such a road was ever used or that such a road ever existed. Mr. Hromadnik specializes in the examination of titles to real estate. He said he could locate the 16 foot easement on lot A, as, indeed, could anyone, but that he could not locate it on lots B, C or D. He testified that he visited the area and that he found some evidence (a few stones according to the photographs) of an old stone wall about 870 feet west of the road in front of the Taylor cabin. He did not say what the extent of the wall was or might have been but he said he saw near the "wall" an opening in the trees that looked "like an old roadway to" him. He identified a photograph of what he said was the "old roadway." We have studied the photograph and we feel bound to say that such a conclusion requires a livelier imagination than has been bestowed on any of us. Even if we assume that there may have been at one time a logging road at this point there is no evidence to indicate where it went, who used it, or that it would have been of any use to the residents of the stone house on lot D. In any event there is testimony to the contrary.
In 1921, when Gerry McCullough was 3 years old, his family moved to a farm which included the 97.24 acres later acquired by Arrowood. He lived in what is now the Walchuck house until 1945. Although he moved away, his family continued to reside there until 1955 or 1956. He visited them about twice a week. He said the occupants of the stone house were served by two roads. One came in by the Walchuck house and the other came down from the north (the road). Both roads were used continuously. He identified all of the color photographs of the road and he said he saw no change in its nature or location and that it was as he recalled it during the years he lived there.
The Solters claim that the Walchuck road, east of the Walchuck house, was never used for vehicular traffic and is not now suitable, except at considerable expense, for vehicular traffic. Walchuck has declared the Solters have no right to cross *450 his property and he has effectively prevented access to their property across his land. In any event, the Walchuck road has no significance in the case at bar.
Harrison B. Dayton, the son-in-law of Granville Arrowood, lived in the stone house from 1933 to 1937. He visited the property a few weeks before the trial. He said when he lived on the property ingress and egress were accomplished both by the road and the Walchuck road. He described the road as being the same as it was during the time he lived there.
Essie Kopp, Dayton's daughter, said she was 5 years old when her father moved to the stone house. When she visited the property a few weeks before trial she found the location and condition of the road to be the same as she remembered it to be.
Harry Nace has worked for oil companies in the area since 1951 or 1952. Beginning about 15 years before the trial, he delivered oil to the occupants of the stone house every two weeks in cold weather and once a month when it was not so cold. He would drive his truck over the road and put the oil in 50 gallon drums provided by the occupant. He presented records showing regular deliveries over a period of 10 years. The road, he said, was the same during the entire period of his use of it.
Frances Phillips is the daughter of Mr. and Mrs. Sibley who owned lot B from 1944 to 1951. She visited her parents from time to time on weekends and in the summer time. She testified her father placed a chain across the road at the north entrance to lot B and that he erected a gate at the southern boundary. They were kept in place, as far as she knew, while her father owned the property. There was nothing to indicate that either the chain or the gate was ever locked. She said the road "was in fairly good condition" south of her father's property. She made some reference to another road along the easterly edge of the property but that testimony, even if true, seems to us to lack relevance to the question before us.
The Taylors allowed Herbert Wirtz to hunt on their property. He said he hunted there every season since they bought it. He expressed the opinion that the road south of lot B was *451 impassable to vehicles until the "cannery people"[3] went in there to farm lot D. The balance of his testimony lacks relevance.
Mrs. Taylor testified she didn't "believe an automobile, in 1954, could have gotten through" over the road from her line to lots C and D. She said they "permitted" the Lees (the Solters' predecessors in title) to use the road through their property because Mrs. Lee was ill. There were gates at the north and south lines of the property when they bought it but she "actually never saw the gates across the road." She said nothing about a road along the western boundary of lots B and C.
There appears to be no dispute about the fact that the road, as it exists today, was in existence and in use when Arrowood bought the 97 acre tract in 1933. Any lingering doubt as to that is banished by the testimony of McCullough, Dayton and Essie Kopp. When Arrowood conveyed lot A to Fisher he was careful to retain title to the westernmost 16 foot strip which the deed describes as being owned and used by him, and, entirely consistent with his ownership, he gave Fisher a right to use the 16 foot strip so that Fisher would have access not only to lot A but to lot F as well.
Two years later, in the deed which conveyed lot B to Ray (a predecessor in title of Mrs. Taylor), language was used which was both clumsy and imprecise. However, we think the intent of the grantor is clear. He gave Ray a right to use the 16 foot road running through lot A to the public road. Ray probably would have acquired that right anyway under the clause "together with the rights, ways, waters * * * thereto belonging or appertaining." In the circumstances, the only reasonable construction of the remainder of the language is that Arrowood was reserving a right of way over the road running through lot B for the benefit of his home and his remaining property, lots C and D, the use of which he continued as before. Appellant makes much of the expression "located through the western part" of lot B, claiming it refers to the "Western Road" and not to the road. We see no merit in this. As a matter of fact, *452 the road does run close to the western boundary of lot B for more than half its length.
In 1938 Arrowood sold lot D to Lowe. In addition to the usual grant of "rights, alleys, ways, [and] waters" we find the expression "especially the 16 foot right of way now laid out on the west side of the remaining property of" Arrowood. The "remaining property" is, of course, lot C and it is quite clear that the road is not on its "west side" but on its east side. We think this is an obvious inadvertence on the part of the draftsman. The grant concerns a 16 foot right of way "now laid out" and there is no evidence that a right of way of any width was ever "laid out" anywhere on lot C except, of course, the road. When lot C was sold, a month later, to Mathews the deed provided that "a driveway 16 feet wide" was reserved for the benefit of lot D "recently sold to" Lowe.
It is important to remember that the appellant concedes the Solters have a right of way across her property. She insists, however, that its location is somewhere in the western part of her property. We do not think the evidence supports her claim. Judge Turnbull found as a fact
"that the road through the Woods [lot C] and through the Taylor [lot B] tract[s] as described by the witnesses, as shown by the photographs has been used for many, many, many years, and has been used for many years prior to the first severing of the entire tract; * * * [and] that the reference * * * to the sixteen foot road as now being used * * * was meant and understood to be * * * the road described in the evidence and as shown by the pictures."
Judge Turnbull found it unnecessary, as do we, to consider the doctrines of adverse user and way of necessity, both of which were raised by appellees in this Court as well as in the trial court. In our judgment the case at bar falls comfortably within the familiar rule stated in Sibbel v. Fitch, 182 Md. 323, 326-27, 34 A.2d 773 (1943):
"`Where a way is granted without fixing its location, but there is a way already located at the time of the grant, such way will be held to be the location of *453 the way granted unless a contrary intention appears.' 28 C.J.S., Easements, Sec. 80, Subsec. b."
* * *
"`Where an easement in land, such as a way, is granted in general terms, without giving definite location and description of it, the location may be subsequently fixed by an express agreement of the parties, or by an implied agreement arising out of the use of a particular way by the grantee and acquiescence on the part of the grantor, provided the way is located within the boundaries of the land over which the right is granted. As otherwise expressed, it is a familiar rule, that, when a right of way is granted without defined limits, the practical location and use of such way by the grantee under his deed acquiesced in for a long time by the grantor will operate to fix the location. The location thus determined will have the same legal effect as though it had been fully described by the terms of the grant.' 28 C.J.S., Easements, Sec. 82."
To the same effect see Weeks v. Lewis, 189 Md. 424, 427, 56 A.2d 46 (1947).
In light of what we have said in this opinion we see no reason for disturbing the decree passed by Judge Turnbull.
Decree affirmed.
Appellant to pay the costs.
*454
NOTES
[1] Randolph D. Taylor died 12 April 1967.
[2] "Road" used alone means the road from the stone house to the public road as indicated by the dotted line on the plat.
"Walchuck Road" means a road that once ran from near the Walchuck house to the stone house, now said to be both closed and impassable.
"Western Road" means a road said by appellant to have run, at some time in the past, somewhere along the western boundary of lots B and C.
[3] There was testimony that both the Taylors and the predecessors in title of the Solters leased cleared portions of their land to a farming company. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534719/ | 231 A.2d 491 (1967)
RHODE ISLAND HOSPITAL TRUST COMPANY, Trustee u/d of Charles R. Forrest
v.
Arthur N. VOTOLATO, Jr., Adm'r c.t.a., Estate of Charles R. Forrest et al.
RHODE ISLAND HOSPITAL TRUST COMPANY, Trustee u/d of Harriet T. Forrest
v.
Arthur N. VOTOLATO, Jr., Adm'r c.t.a., Estate of Harriet T. Forrest et al. (two cases).
Appeal Nos. 46-48.
Supreme Court of Rhode Island.
July 14, 1967.
*492 Tillinghast, Collins, & Tanner, Providence, for complainant, William M. Sloan, Providence, of counsel.
Arthur N. Votolato, Jr., pro se ipso, as Administrator c.t.a.
Edwards & Angell, Edward F. Hindle, James H. Barnett; V. Duncan Johnson, Providence, Powers, Hall, Montgomery & Weston, Andrew C. Bailey; Hale & Dorr, John M. Maguire, Boston, Hinckley, Allen, Salisbury & Parsons, Ronald C. Green, Jr., Jacques V. Hopkins, Providence, Hooker, Alley & Duncan, New York City, of counsel. Graham, Reid, Ewing & Stapleton, Joachim A. Weissfeld, Providence, Robinson, Robinson & Cole, Hartford, John M. Donahue, Hartford, of counsel, Gardner, Sawyer, Cottam & Gates, Providence, Edward W. Day, Jr., Providence, Hatfield & Brady, New York City, Edgar W. Hatfield, New York City, of counsel, for other respondents.
OPINION
KELLEHER, Justice.
These actions have been brought by the plaintiff trustee and certified to us pursuant to the provisions of G.L. 1956, § 9-24-28, as amended, for this court's instruction as to the disposition of certain assets held by the plaintiff as trustee of three inter vivos trusts established in 1911 and 1913 by Charles R. Forrest and his wife, Harriet T. Forrest, both now deceased.
Sometime after oral arguments were heard in this case, plaintiff trustee, pursuant to our permission, filed a supplemental brief. We thereupon permitted defendants to file such reply thereto as they deemed necessary. The court also requested that the record herein be supplemented with certain information as to the grandchildren of the settlors. Receipt of the briefs and the requested information is acknowledged. The court is appreciative of the diligence and cooperation exhibited by counsel in this regard.
We deem it necessary to set forth the pertinent facts of the Forrest family history which are relevant to the issues before us. In addition to the parents, the Forrest family consisted of five children, four daughters and one son.
On December 10, 1902, Charles R. Forrest executed his last will and testament *493 and by its sole dispositive provision gave his entire estate to his wife, Harriet T. Forrest. On April 24, 1911, Harriet T. Forrest executed an inter vivos trust in which she reserved to herself for life the income from said trust and provided that the trustee then in its discretion could apply the income for the benefit of her son, George, during his life. Thereafter Mrs. Forrest gave the income for life to her daughters, Helen, Madeleine, Elsie and Virginia.
On June 5, 1911, Charles R. Forrest executed an inter vivos trust reserving for himself the income from said trust. When he died, the income of the trust was to be paid to his daughters in equal shares until the death of the surviving daughter.
Charles R. Forrest died on October 6, 1912, and over a year later on December 29, 1913, Harriet executed a second inter vivos trust which provided, as in the 1911 trust, that the income be paid to her for her life. Upon her death the income from this trust was to be paid in equal shares to the daughters until the death of the last surviving daughter.
All three trusts provided for the distribution of principal upon the decease of the last surviving daughter in substantially the same manner. It was to go to the children and more remote lineal descendants of the daughters who were then living and who would have been entitled to inherit if the settlor had died intestate immediately after the last daughter. Each trust contained a provision that no adopted child should be entitled to receive any share thereof.
In March 1915 Harriet T. Forrest amended both the 1911 and 1913 trusts. The provisions of these amendments are not material to the issues to be resolved in the instant causes. Thereafter, on June 21, 1915, Mrs. Forrest executed her will in which she made various testamentary dispositions of her property.
At the time of Harriet Forrest's death on November 8, 1920, she was survived by all of her five children. Except for her daughter Madeleine, none of the five children had issue. Madeleine was the survivor. She died on September 17, 1963. Although Madeleine had married and had issue, the issue predeceased her. As a result of this unfortunate incident, each of the trusts failed because none of them contained any provision for the eventuality which has occurred, that is, the death of all the daughters without any issue of them surviving.
The plaintiff alleges that in these circumstances it is uncertain as to the distribution of the principal in each of the three inter vivos trusts and therefore commenced the instant actions.
All the parties have agreed that Rhode Island law shall be applied to determine the persons who will benefit under the resulting trusts. In this regard the issue is whether we should invoke the rule enunciated by this court in Industrial National Bank v. Drysdale, 83 R.I. 172, 114 A.2d 191, and reaffirmed in Industrial National Bank v. Drysdale, 84 R.I. 385, 125 A.2d 84, and accordingly impose a resulting trust in favor of the next of kin of Charles R. Forrest and Harriet T. Forrest, or whether these particular assets should revert to the respective estates of the settlors and be distributed by the appropriate provisions of their respective wills.
If Drysdale is not applicable, we must then ascertain which clause of the will of Harriet T. Forrest is dispositive of the assets presently in the possession of plaintiff. Since Mrs. Forrest died a resident of Connecticut, we will, in construing her will, apply the appropriate Connecticut law.
After a careful consideration of all facets of these causes and the well-documented and researched positions of the several claimants to the undisposed trust assets, we are of the opinion that the Drysdale *494 rule is not applicable. In Drysdale the testator bequeathed $10,000 to a trustee to pay the income in equal portions to a charitable organization, The People's Mission, Incorporated, and then left his residuary estate to certain individuals. The trust had been operating for 18 years when it terminated because the corporate charitable beneficiary had been dissolved. In the first Drysdale case we held that the testator had demonstrated a specific charitable intent to aid the mission exclusively and not the poor generally. Therefore, we said the doctrine of cy pres was not applicable and thereupon we ruled the gift lapsed and the trust fund reverted to the next of kin by way of a resulting trust. We pointed out in the second Drysdale case that when we employed the term "lapsed," we were not using that term as it is used in the law of wills. We held that under the law of wills a legacy lapses and falls into the residuary only when the intended legatee dies before the testator and there is no express limitation or bequest over. Upon reflection, it is our opinion that much of the misunderstanding as to our holding in Drysdale comes from our use of the term "lapse" in a manner different from its usual connotation when it is associated with a testamentary disposition. Being possessed of 20/20 hindsight, we admit now that it might have been better if instead of the word "lapsed," we had used the word "failed."
After our opinion was filed, we granted a reargument, and in the second Drysdale case, we adhered to our earlier ruling. In his opinion, which was rendered after a hearing on the reargument, the late Chief Justice Condon pointed out that when the first Drysdale opinion stated that the trust funds reverted to the testator's next of kin, it meant next of kin and not his residuary legatees. It was clear in Drysdale that the gift had vested in the trustee some 18 years prior to the dissolution of the beneficiary. It was also evident that so far as the testator was concerned he did not intend that any other clause of his will was to affect this particular bequest. The title to the trust fund remained vested in the trustee and could not be divested except by an act of law creating a resulting trust. In an effort to place the parties as near as possible in statu quo in Drysdale we applied the trust fund for the benefit of the next of kin without regard to the testator's will since this was an equitable estate which arose by operation of law and not by a supposed intention of the testator. While some of defendants have urged us to adopt the Drysdale rule in these causes, we believe after a careful analysis of both Drysdale cases, having due regard for the facts set forth therein, that the principle of law they contain is limited in its application to the circumstances present in Drysdale, to wit, where there has been a failure of an operating testamentary charitable trust which had vested in the trustee and where there is no general charitable intent evidenced by the testator.
In Drysdale, the fact that the gift was created by a testamentary instrument allowed us to base our decision on the reasoning of In Re Slevin, 2 Ch.L.R. 236. There a bequest was made to an orphanage. The orphanage was in existence before and after the testator's demise but it went out of existence before the legacy could be paid over. The English court rejected the contention that the legacy had lapsed and became part of the residuary estate. The rights between a particular legatee and the residue are fixed, it said, at the time of the testator's death. In Drysdale we adopted this reasoning and held that it was equally applicable when title had vested in the trustee. Moreover, we emphasized in Drysdale that there was a charitable trust which had been operating and from the record there was no evidence indicating that the testator's gift should revert to the residuary estate. This being so, we described the trust property as having been well disposed of.
The facts in the cases at bar do not permit the application of the Drysdale rule. We are concerned here in each instance *495 with the failure of an inter vivos trust and the disposition of the assets. In resolving this issue the most reasonable solution can be found in 2 Restatement, Trusts 2d, § 411, p. 333, which states in part as follows:
"General Rule"
"Where the owner of property gratuitously transfers it and properly manifests an intention that the transferee should hold the property in trust but the trust fails, the transferee holds the trust estate upon a resulting trust for the transferor or his estate, unless the transferor properly manifested an intention that no resulting trust should arise or the intended trust fails for illegality.
"* * *
"b. Transfer inter vivos. Where the owner of property gratuitously transfers it inter vivos upon a trust which fails, the transferee holds it upon a resulting trust for the transferor.
"* * *
"k. Subsequent failure of trust. The rule stated in this Section is applicable not only where an intended trust fails at the outset but also where a trust is created which subsequently fails. Thus, if the owner of property transfers it in trust to pay the income to one beneficiary for life, and on his death to convey the principal to others, and the disposition of the principal is on a contingency which does not occur, there is a resulting trust for the transferor or his estate on the death of the life beneficiary."
The above rule, we believe, finds support in 2 Restatement, Property, § 154, where it discusses a reversionary interest. We point to the illustration therein at page 529 in its discussion of § 154, which reads as follows:
"7. A, owning shares and bonds worth $150,000, transfers them `to B as trustee to hold for the life of C, paying the net income to C to the extent of $4,000 per year, and dividing the balance of the net income between D and E, children of C, remainder on the death of C, to the then surviving children of C.' A has a reversionary interest in the shares and bonds."
It is our considered judgment that the settlors, Charles and Harriet, had a reversionary interest in and to the separate trusts which was capable of being transferred by their respective wills. In each instance there was a grant of a particular estate designed to terminate upon the happening of a certain event (that is, the death of their daughters) with a contingent remainder (in this case, issue to be born who would take the remainder). There remained in each settlor a reversionary interest which was subject to being divested upon occurrence of the above-described contingency.
Our actions herein are not without precedent. In Angell v. Angell, 28 R.I. 592, 68 A. 583, this court was confronted with a fact situation closely akin to the causes at bar. In Angell there was an inter vivos trust whereby the settlor received the income during his life and upon his decease, three of his children were to receive their share of the corpus free of any trust while the remaining share was to be held in trust for the benefit of the settlor's son with the income to be paid first during his life and thereafter to the son's children. There, like here, no provision had been made for the disposition of the trust corpus upon the termination of the life estate. The settlor's will bequeathed his estate in four equal shares to his four children. Three shares were given outright while the fourth was held in trust for the life of the testator's son with a remainder to his children. We held that the undisposed remainder of the inter vivos trust passed under the grantor's will. What we said in Angell, supra, at 599, 68 A. at 586, is apropos here:
"We can only judge of the intent of the settlor and testator by what he has left behind him; and in view of the imperfect and incomplete disposition of this trust fund under the deed, we think it was the manifest intention of the testator *496 by leaving a will to have the trust fund disposed of thereunder."
Our holding here is in accord with the great weight of authority in this field. See Bogert, Trusts and Trustees, § 468 (2d ed.), p. 675; 4 Scott, Trusts, § 430.1 (2d ed.), p. 2986.
We acknowledge there is a statement in 54 Am. Jur., Trusts, § 197, at page 154, which says that "It is a general rule of equity jurisprudence that where a donor conveys, either by will or deed, property on a certain trust or for a certain purpose, and the trust or purpose fails, a resulting trust arises for the benefit of the donor if he is living, or, if the donor is dead, for the benefit of his heirs or next of kin * * *." An analysis of the following cases it cites in connection with this rule does not support such a broad statement of law. In Witten v. Wegman, 182 Ark. 62, 30 S.W.2d 834, a testamentary charitable trust had failed. Although a distribution to the heirs was ordered, it was done because there was no clause in the will which could be described as having disposed of the trust property. So, too, in the case of Seran v. Davis, 174 Okla. 433, 437, 50 P.2d 662, 666, the court stated, "`If the conveyance be by deed, the trust will result in the grantor, if it be by will, the trust will result to the testator's residuary devisees or legatees, or to his heirs or personal representatives, according to the nature of the property and of the dispositions.'" As the case excerpts indicate, the opinions in Witten, supra, and Seran, supra, can hardly be considered as cogent authority for the proposition of law recited above from American Jurisprudence. While we customarily accord respect to the principles expressed in American Jurisprudence, we are constrained to conclude that in this instance the phrase "heirs or next of kin," as it appears in the section under discussion, has been imprecisely construed.
The supplemental brief and memoranda of law to which we referred earlier in this opinion concern the applicability of the ruling made in Kelly v. Nichols, 18 R.I. 62, 25 A. 840, to the instant case. Involved therein was the will of Joseph Greene which was executed in 1839 and provided in part that all Greene's "* * * real and personal estate whatsoever, and wheresoever to be found; particularly my farm on the island of Canonicut, known by the name of the Greene Farm * * *" be devised and bequeathed to certain trustees for the benefit of his unmarried sisters. After the death of the surviving sister, the trust was to continue for certain purposes which the testator evidently considered to be charitable in their nature.
The will also provided for several legacies and in its final dispositive provision gave and bequeathed to a cousin, Thomas B. Gould, books and papers and "* * * all my household furniture of whatever description, together with all the rest and residue of my estate and effects of every kind and nature not hereinbefore disposed of."
The heirs of Joseph Greene brought a bill in equity against the trustees asking that the trust be declared void and that the trust estates be conveyed to them. In an earlier phase of this case[1] the court, in disposing of a demurrer to the bill, determined that the primary purposes of the trust not being charitable in nature, the trust was invalid.
The issue in Kelly v. Nichols, supra, was who, in view of the finding of invalidity, would be awarded the assets of the stricken trust the testator's heirs at law or his cousin, Thomas B. Gould, as the residuary devisee. The court ruled the heirs at law and not the cousin were entitled to the trust proceeds.
Although the ultimate result in Kelly is the same as urged by several defendants here, it is our belief, after a thorough examination of that case together with the *497 authorities cited therein, that the court's decision was based upon rules of law not applicable here.
The trust corpus which was the subject of litigation in Kelly was real property. The governing factors in Kelly were the then prevailing legal principles which concerned the devolution of real estate. In its opinion, the court took pains to point out that both the execution of the testator's will and his death occurred prior to 1844 when the general assembly enacted a statute[2] which permitted the devise of real estate acquired after the execution of one's will. At common law it was impossible to make a general residuary devise. A devise, no matter how broad and sweeping in its terms, was in effect specific; or rather it disposed of specifically what was not already expressed to be given by the will.[3] Accordingly, before 1844, it was clear that a void devise passed to heirs at law and not the residuary devisee.
We think it interesting that the court in Kelly referred to Perry on Trusts, § 160a, and accordingly we set forth below a pertinent portion of this section found in the fifth edition (1899) of this scholarly treatise:
"* * * If real estate was bequeathed upon trusts that were void, or that failed, the real estate did not pass to the residuary devisee, but resulted to the heir-at-law, for the reason that nothing passed by the gift of the residue except what was intended to pass, and a bequest of real estate for a particular purpose indicated a plain intention not to embrace it in the residuary bequest, and although it might be void or fail, yet it was so far operative as to indicate the intention of the donor not to allow it to pass under the residuary clause of the will. * * *"
Perry further states that a different rule was to be applied when personal property was the subject of a trust. Upon failure of such a trust, he says, the corpus would go to the residuary legatee. He also points out that various statutes had been enacted in both England and the United States so that real estate would be governed by the same rules as personal property.
We believe, therefore, that the holding in Kelly is inapposite to the issue before us. The court there was concerned with the disposition of real property and its decision was based on the law of an earlier day. Here, the Forrest trusts are composed of intangible personal property and nothing said in Kelly is relevant or controlling in these circumstances.
It follows therefore that both Charles and Harriet Forrest had reversionary interests in and to the undisposed trust assets presently in the possession of plaintiff which can be conveyed by the appropriate provision of the respective wills. Charles' will presents no problem because he bequeathed his entire estate to his wife. Upon his death in 1912, his reversionary interest in and to his inter vivos trust was conveyed by his will to his wife.
It is the construction of the will of Harriet that presents us with the second issue to be decided here. Since she at the time of her death was a resident of Connecticut, the effect of her will on the trust assets will be determined by the law of that state. Carr v. Railton, 66 R.I. 225, 18 A.2d 646. Some defendants in the case claim that item 12[4] of the will is a general residuary clause and as such it operates to *498 convey to them the reversionary interests which the decedent had in the three trusts. There are other defendants who contend that item 12 is not a general residuary clause, but instead, should be construed to be a clause which simply disposes of Harriet's tangible personal property and nothing else. Under this particular interpretation, those defendants would have us conclude that the corpora of the three trusts, since they are composed solely of stocks and bonds, pass to them under the provisions of item 9.[5] Finally, there are other defendants who propose that still another clause in the will controls which of course results in their selection as beneficiaries over the competing parties. This last group bases their argument on the premise that item 9 governs and not item 12. Due to the view we take in this case, however, there appears no need for us to discuss the merits of the third proposition advanced.
We believe that item 12 of the will of Harriet T. Forrest is a general residuary clause and, as such, it effectively transfers all property of the decedent not otherwise disposed of, which in this case includes her reversionary interest in each of the inter vivos trusts created by either the testatrix or her husband.
Item 9 is not dispositive of the testatrix's interest in assets presently in the hands of the trustee. By its provisions the testatrix had bequeathed "* * * all stocks, all bonds, notes, and other evidences of indebtedness, of which I may die seized and possessed * * *" to the plaintiff as trustee. A chronological analysis of the record shows that Harriet executed her first trust indenture on April 24, 1911. She amended this instrument twice, once on March 18, 1915, and again on March 12, 1920. Her second trust indenture was executed on December 29, 1913, and amended on March 4, 1915. Her will was executed on June 21, 1915. At this time she was the recipient of her husband's reversionary interest in and to his inter vivos trust and she was certainly aware of her two prior trust conveyances.
We hardly think it realistic to hold that when she executed her last will and testament on June 21, 1915, she intended to dispose of intangible personal property which she knew was part and parcel of three separate inter vivos trusts and which she had every good reason to believe had been effectively disposed of by the past actions of her and her late husband. When Harriet T. Forrest stated in item 9 of her will that she was bequeathing to plaintiff trustee "* * * all stocks, all bonds, notes, and other evidences of indebtedness, of which I may die seized and possessed * * *" she was not referring to any such items which had been conveyed to the trustee by either her or her husband. As far as she was concerned, the trustee and not she was "seized and possessed" of these assets. At the time of her death she retained only a reversionary interest which represented a future right to these assets which would happen if the trust failed. See In Re Bracalello's Will, 11 App. Div.2d 804, 204 N.Y.S.2d 969. The reversionary interests which are capable of being bequeathed by Harriet's *499 will are not embraced by the terms of item 9.
The Connecticut Supreme Court in Mechanics Bank v. Yale University, 111 Conn. 452, 150 A. 526, in a case similar to these before us, ruled that a bequest of "all my stocks and bonds" did not carry with the testator's interest as residuary legatee of his mother's estate which was composed of several hundred shares of stocks. The testator died leaving a widow and children. His mother had predeceased him and at the time he died his mother's estate was still pending. The bequest of "all my stocks and bonds" was in trust with the income to be paid to the wife and children and upon certain contingencies the securities were to be given to Yale. There was a residuary clause wherein the wife was the sole beneficiary.
The Connecticut court, 111 Conn. at 459, 150 Atl. 529-30, stated:
"The words `all my stocks and bonds' * * * are to be read in their primary meaning unless that conflicts with the terms of the will when read in the light of the surrounding circumstances. The primary meaning of these words, by no process of expansion, can be made to include an interest in the residue of an unsettled estate, such as that of the testator's mother. Whatever interest the testator had in the shares of Proctor and Gamble Company which were a part of his mother's estate became a part of the residue of his estate unless they have been disposed of in some other part of his will. This cannot be found in any other part of the will unless it be included within the term `my stocks and bonds' * * *.
"* * *
"This stock was not in the possession of the testator at the time of his death but in that of the executor of his mother, nor did the testator have the right of possession, since the estate had not then been settled and a distribution ordered.
"The testator could not exercise any of the rights of an owner or possessor of the stock. * * *"
The court concluded:
"At the time of his death the testator had only an interest in the unsettled estate of his mother existent from her death; he had no present right to or ownership of the three hundred and four shares of the Proctor and Gamble Company stock belonging to the estate of his mother.
"From these considerations we conclude that it was the intention of the testator that his interest in the unsettled estate of his mother should become a part of the residue of his estate and should not become a part of the trust [of stocks and bonds] * * *."
Our belief in this regard is strengthened when we study the language used in the last portion of item 9, where the testatrix authorized the trustee to retain the securities "* * * in the form in which they are held by me at the time of my decease, even though they are of doubtful value * * *," is that the use of the term "held by me" makes it quite apparent that the securities Mrs. Forrest was referring to were of those which were in her actual physical possession and not to any reversionary interest she had in the securities which make up the three inter vivos trusts.
While the location of a residuary clause is not in and of itself determinative of its function, it is a factor to be considered when determining which provision in a will is the residuary clause. A residuary clause is usually the last dispositive provision in the will. 4 Bowe-Parker: Page on Wills, § 33.47, p. 370. In Harriet T. Forrest's will item 12 is located in just such a position. In State Bank & Trust Co. v. Nolan, 103 Conn. 308, 328, 130 A. 483, 490, the court held:
"In most cases a residuary clause, where there are other definite and important bequests, cannot be taken as the primary *500 and principal factor determinative of testamentary intent; it is a catch-all, a refuse group; a provision which operates after the operation of the other provisions of a given will; its logical position is the same as its local position, at the end of the testamentary process, not at the beginning."
What is said about the location of a residuary clause is equally applicable to the language necessary to the inclusion of such a provision in a will. Although there is no particular phraseology or set form of words which is necessary to a residuary clause, we held in Quinn v. McDowell, 47 R.I. 314, 132 A. 888, that the words "rest and residue" in the absence of language showing a contrary intention mean the estate remaining after satisfying all previous gifts. The words "rest, residue and remainder" in City Bank Farmers Trust Co. v. Taylor, 53 R.I. 126, 133, 163 A. 734, 737, were held to include all the estate left by the testator not previously disposed of by his will and signified a complete disposition of all his property. The same conclusion as to use of like language has been reached in Connecticut. See Raughtigan v. Norwich Nickel & Brass Co., 86 Conn. 281, 85 A. 517.
The use of the word "including" in item 12 enlarges not limits the scope of this provision. Thus in Carr v. Railton, supra, at 243, 18 A.2d at 654, we said: "`Including' is generally employed as a term of enlargement and not as one of limitation or enumeration and, when used in a will, it implies that something else is given beyond what is covered by the general language which preceded it."
We do not believe the fact that the testatrix enumerated certain items of property which were to pass under item 12 changes its character as a general residuary clause. In 4 Bowe-Parker: Page on Wills, § 33.49, p. 375, it is stated that "Where a clause purports to pass the residue of testator's estate, and attempts to enumerate some or all the different items in such residue by way of example, the clause passes the entire residue, and is not limited to the items named." See also 72 A.L.R. 2d 1173. Although there is no Connecticut case which expressly states this view, this statement appears to be the general rule, and there is no Connecticut case to the contrary.
In the case of Martin for an Opinion, 25 R.I. 1, 54 A. 589, which involved the construction of a clause similar in language to the one in the will of Harriet T. Forrest, we rejected a contention similar to the one made here by those who seek to invoke the provisions of item 9. We held there that the mere enumeration of some of the articles in a residuary clause does not alter the character of the legacy. The general rule, we said, is that a residuary legacy is general and not specific. This is equally true of the will of Harriet T. Forrest. We can discover no intent on her part to deprive item 12 of its general residuary character so as to limit its dispositive power. The assets of three inter vivos trusts created by Charles R. and Harriet T. Forrest fall within the dispositive provisions of item 12 of the last will and testament of Harriet T. Forrest.
On August 7, 1967, the parties may submit for our approval a form of judgment in accordance with this opinion to be entered in the superior court.
NOTES
[1] See Kelly v. Nichols, 17 R.I. 306, 21 A. 906, 19 L.R.A. 413.
[2] P.L. 1844, An Act in relation to Wills of Real and Personal Estate, Sec. 1, p. 231 (apparently during this time no chapter designation was accorded to any of the acts passed by the general assembly.)
[3] Schouler on Wills, (2d ed.) 1892, § 521. This work is cited by the court in its opinion.
[4] "Item 12. I give and bequeath to my said daughters, Madeleine F. Burke, Elsie Forrest and Virginia Forrest, all the rest and residue and remainder of my estate, including pictures, furniture, rugs, books, silver, jewels, antiques, clothing, and all other articles of personal property not hereinbefore disposed of to be divided equally between them."
[5] "Item 9. Subject to the demand upon the income thereof under Item 8, I give and bequeath all stocks, all bonds, notes, and other evidences of indebtedness, of which I may die seized and possessed to the said Rhode Island Hospital Trust Company, IN TRUST, for the following uses and purposes: To be added to the trust created by me in Item 2 of this will, under my power of disposition, to become part and parcel thereof, and to be treated, as to its management, payment of income, and final division, as provided by me in this will with reference to said trust; and I hereby confer upon said Trust Company in respect of the property bequeathed to it in this paragraph the same powers to vary and change investments and of sale which I have given or attempted to give it in said Item 2, and I further expressly authorize and empower said trustee to retain any securities in the form in which they are held by me at the time of my decease, even though they are of doubtful value or hazardous, without being liable for any resulting loss." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534739/ | 95 N.J. Super. 455 (1967)
231 A.2d 816
MEAD JOHNSON AND COMPANY, PLAINTIFF-APPELLANT,
v.
BOROUGH OF SOUTH PLAINFIELD, DEFENDANT-RESPONDENT AND DIVISION OF TAX APPEALS, IN THE DEPARTMENT OF THE TREASURY, STATE OF NEW JERSEY, RESPONDENT.
Superior Court of New Jersey, Appellate Division.
Argued June 12, 1967.
Decided June 26, 1967.
*457 Before Judges GOLDMANN, KILKENNY and COLLESTER.
*458 Mr. Richard M. Goldman argued the cause for appellant (Messrs. Stein, Bliablias and Goldman, attorneys).
Mr. Harman R. Clark, Jr. argued the cause for respondent, Borough of South Plainfield.
Mr. Arthur J. Sills, Attorney General of New Jersey, attorney for respondent, Division of Tax Appeals, filed a statement in lieu of brief (Mr. Elias Abelson, Deputy Attorney General, of counsel).
The opinion of the court was delivered by KILKENNY, J.A.D.
Mead Johnson and Company, a corporation of the State of Indiana, hereinafter "Mead Johnson," appeals from two judgments of the State Division of Tax Appeals. The first affirms an omitted tax assessment of $300,000 for 1964 made by the Borough of South Plainfield on personal property of Mead Johnson stored in a warehouse in that borough. The second affirms a tax assessment (not omitted) of $33,309 for 1965 on Mead Johnson's goods similarly stored in the same warehouse. Both judgments denied Mead Johnson's claims that the merchandise was stored in a public warehouse and was, therefore, exempt from taxation under R.S. 54:4-3.20.
R.S. 54:4-3.20 provides:
"All personal property stored in a warehouse of any person, copartnership or corporation engaged in the business of storing goods for hire shall be exempt from taxation under this chapter."
The statute was enacted "to place our public warehouses on an equal competitive footing with those of our neighboring states where no personal property taxes were imposed." General Electric Co. v. City of Passaic, 28 N.J. 499, 505 (1958). Its constitutionality has been sustained and it has been applied in many reported decisions. Ibid. The warehouse exemption, originally adopted in 1925, "was based on *459 the legislative policy to further the common good by encouraging the development of New Jersey's warehouse industry". Id., at p. 509. It was anticipated that "any loss of taxes in the State of New Jersey would be more than offset by the increase of taxable property of New Jersey warehousemen resulting from their growth." Ibid.
There is no issue herein as to the storage of Mead Johnson's goods in the particular warehouse at 3605 Park Avenue, corner of Oak Tree Road, during the periods involved, or as to the value of the personal property, which consists essentially of medically prescribed food articles. As the Division properly observed, the sole question for decision is whether or not under all of the circumstances the personal property was stored in a warehouse within the meaning of the statutory exemption. The Division concluded that as between Mead Johnson and the operator of the warehouse, Oak Tree Distributors, Inc., the latter was not acting as a "warehouseman." It determined that "this warehouse is operated principally for the private convenience of Mead Johnson." On that finding, the tax exemption was denied.
Mead Johnson owned this warehouse and operated it through its own employees and for its own purposes until 1961 when, in furtherance of a change in company policy discontinuing its own warehouse operations throughout the country, it sold this warehouse in a bona fide sale for $275,000 to Nat Singer. Singer had stored products of Mead Johnson for many years prior thereto in his public warehouse in the Bronx, New York. Title was taken in the name of S.F. Investors, Inc., a New Jersey corporation organized by Singer and composed of members of his family and his New York attorney. The "S" and "F" in the corporate name represent the initials of Singer's children, Shirley and Fred. The deal involved a payment of 10% in cash and a 15-year purchase money mortgage for the balance, with interest at 4 1/4% and annual amortization of 4%.
The agreement of sale between Mead Johnson and Singer provided that for a period of one year commencing May 1, *460 1961 Singer would furnish Mead Johnson with all warehousing and distribution services for its products at such location, including as incidental thereto other necessary and connected services, such as mailing and invoicing services which it might require. Singer was to charge for all services and Mead Johnson was to pay therefor "cost, plus 5% thereof." It was further agreed that similar services would be furnished for a further period of two years commencing on May 1, 1962 "at your cost, plus 5%." The agreement also provided that "at any time during the said two year period either party may terminate such arrangement upon giving to the other party ninety days' written notice of such termination."
Singer formed another New Jersey corporation, Oak Tree Distributors, Inc., hereinafter "Oak Tree," similarly composed of members of his family and his New York attorney, to operate the warehouse as a tenant of the title owner, S.F. Investors, Inc. "Oak Tree" in this corporation's name was derived from the fact that the warehouse was at the corner of Oak Tree Road. There was no inter-corporate relationship between Mead Johnson and any of Singer's corporations. Neither had any stock or financial interest in the other. Except for the purchase money mortgage and its rights of storage under the agreement of April 26, 1961 limited to the periods specified therein Mead Johnson had no rights in any of Singer's corporations or to store its goods in the South Plainfield warehouse. Its continued presence there to the present time on the same terms is at will only and terminable at any time by either party.
Mead Johnson occupies about 90% of the space in this warehouse. Oak Tree has about a dozen other well-known customers who store their goods in the remaining space. There is no actual separation of space as between Mead Johnson and the other customers. As goods come in from any customer they are stored in whatever space is then available. The operation is that of a modern distribution warehouse, as contrasted with the old dead-storage type. The *461 products and goods of the storers come in by carrier in large shipments and frequently move out in smaller quantities.
When Oak Tree took over the operation of this warehouse it engaged as its employees many of the personnel previously on the Mead Johnson payroll. It did so in order to avoid any problems with the labor union and to satisfy its own need for trained help. Full control of the warehouse operation, however, has been and is in the Singer corporations. Only Oak Tree employees perform the required services at the warehouse. No Mead Johnson employee functions there. At the beginning Oak Tree rented the office equipment which Mead Johnson had at the warehouse, until it subsequently acquired it by purchase. The only link Mead Johnson has with the warehouse, beyond the storage of its products there and its orders from time to time for release thereof, is a telephone listed in its name. Only Oak Tree employees answer this phone. Its principal use is for emergency orders from hospitals and doctors for Mead Johnson products. It was testified that this is not an unusual service in distribution warehouses.
The services rendered by Oak Tree for Mead Johnson are equally available to its other customers. While Mead Johnson is its principal customer, Nat Singer testified that he is constantly soliciting other customers by "belonging to and attending different clubs and meetings and trade functions, getting around meeting people and seeing people, golf outings, trophies, so on." The storage charges to Mead Johnson are calculated by taking the total operating expenses, deducting therefrom 60% of the income from other storers, and adding to the balance 5%. By this method Mead Johnson pays for its storage and related services a sum comparable to the rate per hundredweight charged to Oak Tree's other customers and generally by warehouses in northern New Jersey. This cost-plus method of paying for storage is similarly employed by Mead Johnson in its dealings with other public warehousemen.
*462 Oak Tree issues warehouse receipts to most of its other customers, but it follows a different method with Mead Johnson. It uses as a warehouse receipt "a photostated bill of lading which is already signed by the carrier." As Singer explained it, Mead Johnson sends to the warehouse a form or notice of "inbound" merchandise in advance of delivery. When the goods arrive, the truckman brings his bill of lading to the office. The inbound notice is compared to the bill of lading and, if everything checks out, the carrier is assigned a door or loading dock. The merchandise is unloaded on pallets and placed in storage. The warehouseman then signs the bill of lading, noting any exceptions. The signed bill of lading is used "in lieu of a warehouse receipt." This same procedure is followed in the case of some of Oak Tree's other customers.
Gene A. McDowell, the only other witness besides Singer, testified as distribution manager of Mead Johnson that the bill of lading consigning the merchandise to Mead Johnson in care of the public warehouse was a self-protective measure to avoid any question that title to the merchandise had passed out of the company. By the warehouseman's receipting for the merchandise, "he has accepted the liability as applicable to the bailee-bailor situation," according to McDowell. At least, that was the intended relationship between Mead Johnson and Oak Tree. He corroborated that the rates charged by Oak Tree are comparable to the rates charged by other warehousemen in the northern part of New Jersey; that Mead Johnson has no control over the goods while they are at the warehouse, other than to direct where they are to go; and that Mead Johnson has no employees at Oak Tree. Exemption had not been claimed for prior years because Mead Johnson was unaware then of the exemption statute.
The State Division of Tax Appeals, in denying exemption under R.S. 54:4-3.20, characterized the relationship between Mead Johnson and Oak Tree as more nearly approximating *463 that of principal and agent than that of warehouseman and customer. In its words:
"The financial relationship mortgagor-mortgagee, the long business relationship, the special services supplied to this customer, the cost plus compensation arrangement, the sharing of revenues from other customers, the dominant position of Mead Johnson among all customers all of these factors taken together, no one of which is sufficient by itself, lead us to the conclusion that this warehouse is operated principally for the private convenience of Mead Johnson, and exemption must be denied."
Reliance was placed on General Electric Co. v. City of Passaic, 28 N.J. 499 (1958).
The only other case cited by the Division in support of its conclusions was Jersey City v. Liggett & Myers Tobacco Company, 14 N.J. 112 (1953). That case is factually distinguishable. There, the taxpayer leased definite space in a warehouse, supplied its own employees, and the warehouseman had no control over, access to, or responsibility for the stored goods. This was obviously a landlord-tenant relationship, and was held to "exclude the bailor-bailee relationship and substitute an entirely different relationship outside the statutory exemption." At p. 115. The instant case is a far cry from that situation. Here we have the ordinary delivery of goods to a public warehouseman, for redelivery to the owner when called for. That constitutes a bailment, as the Liggett & Myers case recognized. 14 N.J., at p. 115.
In General Electric Co., supra, the State Division of Tax Appeals had held that the goods of the manufacturer stored in a warehouse were entitled to a tax exemption under R.S. 54:4-3.20, even though 99% of the approximately 100,000 square feet of warehouse space was occupied by the products of the General Electric Co. Because the record on review contained but little on the issue whether the warehouse was operated as a bona fide public warehouse, or as a business convenience for the manufacturer, the Supreme Court reversed and remanded the cause to permit a full exploration of the activities engaged in by the warehouse company.
*464 That case was factually much weaker than the case sub judice. General Electric Co. there had an inspector at the warehouse to check each unit immediately prior to its shipment to the customer. It sent its employees from time to time to the warehouse to adjust or alter units to conform with newly adopted designs. No warehouse receipts were used, but an I.B.M. card system was employed to record the units received and released by the warehouse company. The record was silent as to what activities, if any, the warehouseman engaged in towards soliciting warehouse business from the public generally. So, too, it did not indicate how the storage rates charged to General Electric Co. compared with storage rates charged by public warehouses in the Passaic area or elsewhere in northern New Jersey.
The test of exemption or not was expressed as follows in the General Electric Co. case:
"If the taxpayer stores its property in a well-established or newly created public warehouse, genuinely operated as such, it is entitled to the benefit of the statutory exemption. * * * On the other hand, if it stores its property in a warehouse created or operated for its own private convenience and not genuinely operated as a public warehouse, then the statutory objective is not being served and no justifiable basis exists for favoring such personal property as against personal property stored at premises of taxpayer generally." 28 N.J., at p. 513.
In a concurring opinion, Justice Heher expressed the view that "the issuance of warehouse receipts is not determinative of the legal existence of a warehouse." At p. 517. He also stated that it cannot matter "whether the particular warehouse has at a given time, one, two or three, or several or many customers." Ibid.
In Halligan & McLellan, Inc. v. State Board of Tax Appeals, 122 N.J.L. 551 (Sup. Ct. 1939), lumber stored upon the premises of a warehouse company engaged in the business of storing goods for hire was held to be tax-exempt under the statute, even though the warehouseman did not ordinarily issue warehouse receipts for lumber, but did so only as the occasion warranted, as for instance where deposited *465 with a bank as security for a collateral loan. The court ruled that the issuance of a warehouse receipt was not essential to bring the transaction within the statute. So, too, in the instant case, the use of a bill of lading by which Mead Johnson consigned the goods to itself and Oak Tree's receipt for the goods did not derogate from a bailment of the goods or from Oak Tree's status as a warehouseman, as defined in the exemption statute and in R.S. 57:1-1 et seq., the Warehouse Receipts Law.
In City of Newark v. Weyerhaeuser Timber Co., 18 N.J. Misc. 560, 15 A.2d 224 (1940), the State Board of Tax Appeals held that property stored by a merchandising company in a public warehouse for hire was exempt from taxation under R.S. 54:4-3.20, where such warehouse is operated by a corporation actually engaged in the business of public warehousing generally, and this despite the fact that said corporation is a wholly-owned subsidiary of the taxpayer, occupying the same premises formerly occupied by the taxpayer. That decision went so far as to hold that the State Board may not deny the statutory exemption upon the sole ground that the taxpayer contrived the organization of the warehouse company in order to avoid taxation of the stored property. There is no suggestion in the instant case that Oak Tree is a subsidiary of Mead Johnson or that it was contrived by Mead Johnson to avoid taxation. Thus, the facts herein make a stronger case for tax exemption.
In Dearborn Chemical Co. v. Division of Tax Appeals, 135 N.J.L. 580 (Sup. Ct. 1947), the chemical products of a foreign corporation stored in a public warehouse in New Jersey were held to be tax-exempt under R.S. 54:4-3.20, even though the owner of the goods had certain of its own employees on duty at its space in the warehouse. This did not operate to destroy the relationship of bailor and bailee between the storer of the goods and the warehouse company, an independent corporation of New Jersey having no connection by way of ownership or management with the owner of the chemical products. Again, the facts herein make a *466 stronger case for tax exemption, Mead Johnson not having had any of its employees at Oak Tree's warehouse.
The applicable legal principles present no difficulty. The right to the claimed statutory exemption depends entirely upon the facts and circumstances of each particular case. The bases relied upon by the State Division for denying tax exemption herein are not valid. The sale of this warehouse by Mead Johnson to Singer's corporation was a bona fide business transaction and the seller's taking back of a purchase money mortgage does not affect Oak Tree's status as a public warehouseman. Nor does the long business relationship between Mead Johnson and Singer as customer and warehouseman prove anything other than that they found mutual satisfaction in their dealings with each other. The services rendered to Mead Johnson were no different from those available to other customers of this general distribution warehouse. The cost-plus arrangement was that customarily employed by Mead Johnson in its dealings with other public warehouses and produced for Oak Tree a resulting rate in substantial conformity with that charged its other customers. Mead Johnson was Oak Tree's biggest and most important customer, but Mead Johnson had no exclusive right to any part of this warehouse or any financial interest therein. Its position there depended upon its willingness to continue to use it and Oak Tree's and Singer's willingness to allow it to do so.
We are mindful of the limited scope of our appellate review of determinations of administrative agencies. We may not substitute our independent judgment for that of the board or agency where its findings are supported by substantial evidence, i.e., such evidence as a reasonable mind might accept as adequate to support a conclusion. In re Public Service Electric and Gas Co., 35 N.J. 358, 376 (1961). So, too, it is not our function to weigh the evidence, to determine the credibility of witnesses, to draw inferences and conclusions from the evidence and to resolve conflicts *467 therein. Hornauer v. Division of Alcoholic Beverage Control, 40 N.J. Super. 501, 504 (App. Div. 1956).
But in this case there are no conflicts to be resolved and there is no issue as to the credibility of the only two witnesses who testified and whose testimony stands unimpeached. In brief, the conclusion of the State Division is not based upon substantial evidence, adequate to support it. On the contrary, the proofs herein lead us to conclude that Mead Johnson's claims to personal property tax exemption for 1964 and 1965, by reason of R.S. 54:4-3.20, should have been allowed.
The two judgments of the State Division of Tax Appeals under review are reversed and the assessments are set aside. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534743/ | 247 Md. 319 (1967)
231 A.2d 15
AMERICAN NATIONAL BANK OF MARYLAND
v.
MACKEY, ASSIGNEE
[No. 493, September Term, 1966.]
Court of Appeals of Maryland.
Decided June 30, 1967.
The cause was argued before HAMMOND, C.J., and HORNEY, MARBURY, OPPENHEIMER, BARNES, McWILLIAMS and FINAN, JJ.
Vincent R. Landau, with whom were John H. Somerville and Hinkley & Singley on the brief, for appellant.
*320 H. Kenneth Mackey for appellee.
MARBURY, J., delivered the opinion of the Court.
The Peoples Bank of Elkton, mortgagee, through its assignee for collection, H. Kenneth Mackey, appellee, brought suit in the Circuit Court for Queen Anne's County to foreclose first and second mortgages in default under powers of sale contained in the mortgages. The appellant, American National Bank of Maryland, filed a claim in the proceedings for $7,194.36, under a third mortgage, against the proceeds of sale. The auditor's report on the distribution of the foreclosure proceeds stated a $3,889.87 deficiency for the appellant, which excepted to the allowance in the report of certain fees and commissions as costs of sale. The exceptions were partially sustained and partially over-ruled. This appeal was taken from the part of the order which allowed payment of both the collection commissions stipulated in the two notes secured by the foreclosed mortgages and the sale commissions and fees provided by the terms of the mortgages themselves.
The Peoples Bank of Elkton was the holder, under assignment to it without recourse on February 25, 1965, from the original mortgagee, William J.J. Manning, Jr., of a purchase money mortgage dated March 27, 1963, which secured a promissory note of the same date in the sum of $40,000, and a second mortgage which secured a promissory note both dated May 18, 1964, in the sum of $10,000.
The note secured by the $40,000 purchase money mortgage authorized "any attorney of any court of record in Maryland or elsewhere, to appear, either at or after maturity thereof for (me) (us) in any court of record or before any Justice of the Peace, and consent to the docketing of a case wherein (I) (we) shall be defendants, and to confess a judgment against (me) (us) in favor of the plaintiff for the above sum and interest thereon, with costs of suit and without stay of execution and with 10% commissions for collection * * *." The deposit of the mortgage as collateral security was then cited and was followed by a printed provision authorizing the sale of the collateral security at any time on default to liquidate any payment due, including interest and costs thereon.
*321 The purchase money mortgage recited that it was executed to secure payment of the $40,000 note and set forth the terms of the note as to the amount of the principal, interest and time for repayment; no reference was made to costs or collection commissions provided by the note. It further provided a power of sale in the event of default, under which, in addition to a foreclosure sale commission, a fee of $100 was stipulated to be paid from the sale proceeds.
The note secured by the second mortgage promised to pay $10,000 * * * "with all costs and 15 per centum commissions for collecting same, and I, we, or either of us, whether makers, securities, endorsers, or guarantors, do hereby waive protest and notice of protest and do hereby confess judgment to be entered by the proper official, at any time after maturity for the amount due hereunder, with all exemptions waived."
The second mortgage recited that it was executed to secure payment of the $10,000 and set forth the terms of the note as to the amount and time for repayment; no reference was made to costs or collection commissions provided by the note. It further provided a power of sale in the event of default, under which, in addition to a foreclosure sale commission, a minimum counsel fee of $50 was stipulated to be paid from the sale proceeds.
The maturity dates of the mortgages were modified by addendum on February 25, 1965.
On July 28, 1965, The Peoples Bank of Elkton assigned the notes and the mortgages and addendum for collection by foreclosure or otherwise, to H. Kenneth Mackey, the appellee, the indebtedness being in default. The appellee instituted foreclosure proceedings under the power of sale contained in the mortgages. Mackey thereafter filed a petition in the proceedings to share in any surplus proceeds as judgment creditor, by virtue of a judgment entered February 24, 1965, by confession in his favor against the mortgagors under their note to him, in the sum of $9,550, with interest, costs and a fifteen per cent attorney's collection commission of $1,432.50. Appellant filed its petition as creditor for the sum of $7,194.36 under a third mortgage.
The property was sold at public auction by the appellee, as assignee, and the sale was ratified and confirmed by order of *322 court. From the sale proceeds of $64,502.25 there remained, under the auditor's report, surplus proceeds in the amount of $14,764.49. Appellee's claim was given priority by the auditor over that of the appellant, and full satisfaction thereof in the amount of $11,460 was allowed from the surplus proceeds, including the fifteen per cent attorney's commission of $1,432.50 under the note. The balance of the surplus proceeds, which consisted of $3,304.49, was applied to appellant's claim, leaving it with a deficiency of $3,889.87 as of the date of sale. Appellant's exception No. 1 to the allowance of the $1,432.50 attorney's commission was sustained, the court holding that the owner of or obligee of a confessed judgment note who himself, as an attorney, enters judgment on the note, cannot also claim the attorney's fee for collecting the debt. Appellant's deficiency was thereby reduced to $2,457.37. Among the costs of sale allowed by the auditor to the appellee as assignee for collection of the foreclosed first and second mortgages, were the following fees and commissions: attorney's fees recited in the notes secured by the mortgages, $4,498.27; assignee's commission on the $64,502.25 proceeds of sale, $3,375.10; and attorney's fees stipulated in the mortgages, $150; for a total of $8,023.37.
Appellant's exception No. 2 stated that "by reason of the attorney's fees allowed in the mortgage notes foreclosed in these proceedings, the commissions allowed in said Account to the assignee, who also received said attorney's fees, were excessive." The exception was overruled and this appeal taken.
On appeal appellee argued that the only challenge to the auditor's report by the appellant was to the compensation provided in the mortgages. Since appellant did not challenge below the compensation provided by the notes and since it had abandoned on appeal the question of compensation provided by the mortgages, appellee argued, there was nothing before this Court to decide.
Although the exception is inartfully stated, it can reasonably be read to have excepted to the allowance of collection commissions on the notes. "Mortgage notes" may fairly be read as meaning notes secured by mortgages. In any event, the exception filed by the appellants was exact and definite as to the item of the account excepted to (fees and commissions), and it was *323 not necessary that all reasons relied on to support the exception should have been stated in the exception itself. Stokes v. Detrick, 75 Md. 256, 23 A. 846.
The court below overruled the second exception on the basis of the decision in Gaither v. Tolson, 84 Md. 637, 36 A. 449. That case held that an attorney to whom a debt is referred for collection by foreclosure of a mortgage containing a power of sale and providing for attorney's commissions incurred in the collection of the indebtedness secured by it is entitled to commissions for making the sale and attorney's fees for collecting the debt. This rule was not applicable to the issue of whether collection commissions on the notes were payable to appellees; because in the Gaither case, the court did not have before it a claim for the allowance of collection commissions stipulated in a note in addition to the legal fees and commissions paid under the terms of a mortgage. By erroneously applying the law of Gaither to this issue, the court was in error in allowing payment of both the collection commissions stipulated in the two notes and the fees and commissions provided by the mortgages.
An attorney's fee specified in a promissory note authorizing a judgment by confession for the amount due with interest and attorney's fees can be collected only upon confession of judgment as specified in the note. Eaton v. Commercial Nat. Bank, 66 Colo. 450, 182 P. 890 (1919); Schmoldt v. Chicago Stone Setting Co., 309 Ill. App. 377, 33 N.E. 182 (1941). See Webster v. People's Loan Etc. Bank, 160 Md. 57, 152 A. 815. No allowance is made for attorney's commissions unless services contemplated for such allowance and commensurate therewith are actually rendered. Webster v. People's Loan Etc. Bank, supra.
In the present case, only one principal indebtedness existed under each mortgage and the note it secured. The notes made reference to the mortgages which secured the notes, and the mortgages identified the notes and recited the terms of the notes with respect to the principal indebtedness, interest, and time for payment. However, neither the notes nor the mortgages provided that action on one was action on the other, thereby entitling an attorney to the fees provided by both. Each instrument provided for its own relief on default. The mortgages provided, *324 by stipulation of attorney's fees, for legal services with respect to foreclosure and a sale; and the notes, by stipulation of collection commissions, provided for attorney's fees upon a confessed judgment.
However, while the functions and performances of services for which the allowances were made in the instruments were both for the purposes of securing repayment of the indebtedness in default, they were nevertheless distinct. Tompkins v. Drennan, 95 Ala. 463, 10 So. 638 (1892).
In Tompkins, the defendant sold certain land under a power of sale in a mortgage which had been made to secure two promissory notes payable to the defendant. Plaintiff excepted to the sum retained by defendant as attorney's fee. The mortgage conferred upon the mortgagee a power to sell the property and to pay for the expenses of sale and of attorney's fees. This was the extent of the provision in the mortgage on the subject. In each of the notes it was provided that the undersigned agreed that in case the notes were not paid at maturity, the mortgagor was to pay not less than ten per centum for collection. The Court, in holding that the mortgagee could not retain ten per centum out of the proceeds of sale under the power, said:
"There is one provision in the mortgage itself for the payment of attorney's fees, and another and different provision on the same subject in the notes which were secured by the mortgage. * * * The two provisions are separate and distinct, without any reference in the one to the other. There is an independent field of operation for each of them. A creditor whose demand is evidenced by the debtor's personal obligation, which is secured by a mortgage upon land, has the choice of foreclosing the mortgage upon the breach of the condition thereof, or of proceeding against the debtor without regard to the mortgage security. If either of the two resources may be exhausted without satisfying the demand, resort may be had to the other. Until the demand is satisfied, the creditor may seek at the same time, but by separate and independent proceedings, both the enforcement of the personal liability *325 of the debtor, and the foreclosure of the mortgage security. The power of sale in the mortgage affords a means of enforcing the security alone. In making a sale under the power, the creditor avails himself of a special provision for subjecting to the satisfaction of his demand only the property covered by the mortgage. The exercise of the power may involve the expense of attorney's or solicitor's fees. In the present case the payment of such fees out of the proceeds of sale is authorized by the terms of the power itself. This provision covers only such fees as are incident to the exercise of the power, and does not cover expenses incurred for fees for the prosecution of an action at law on the notes, or of a bill in chancery for the foreclosure of the mortgage. * * * There is nothing, either in the mortgage or in the notes, to show that it was the intention of the parties that the provisions in the notes on the subject of attorney's fees should apply in the case of a sale under the power; and as the provision in the mortgage itself fully covers that contingency, and there are other and different contingencies in which the provisions in the notes as to the attorney's fees would be applicable, our conclusion is that those provisions do not cover the case of a sale under the power." 10 So. at 639.
The only legal service performed by appellee was that done in the foreclosure of the mortgages for which fees for such services were provided by the terms of the mortgages. A second fee for the same services was not contemplated under the terms of the notes, since they were not payable unless services were rendered when confessed judgments were entered. The fees provided in the notes were not gratuities to which the attorney was entitled upon the entry of his appearance, and payment of such fees without corresponding services was in error. See Webster v. People's Loan Etc. Bank, supra.
We conclude that the chancellor by his order of September 23, 1966, erred in not sustaining appellant's exception No. 2, thereby allowing payment of both the collection commissions *326 stipulated in the two notes secured by the foreclosed mortgages and the commissions and fees provided by the terms of the mortgages themselves. He should have disallowed the payment of the collection commissions stipulated in the two notes.
Order reversed and case remanded to the lower court with instructions to require the auditor to re-state the account in accordance with this opinion. Appellee to pay the costs of this appeal. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534769/ | 49 N.J. 420 (1967)
231 A.2d 201
LEGION MANOR, INC., A CORPORATION OF THE STATE OF NEW JERSEY, AND WEBSTER HOMES, INC., A CORPORATION OF THE STATE OF NEW JERSEY, PLAINTIFFS-APPELLANTS,
v.
MUNICIPAL COUNCIL OF THE TOWNSHIP OF WAYNE, A MUNICIPAL CORPORATION OF THE STATE OF NEW JERSEY, DEFENDANT-RESPONDENT.
The Supreme Court of New Jersey.
Argued April 10, 1967.
Decided July 5, 1967.
*423 Mr. Martin S. Mandon argued the cause for plaintiffs-appellants (Messrs. Mandon & Schwartz, attorneys).
Mr. Anthony J. Orrico argued the cause for defendant-respondent (Mr. Peter J. Van Norde, attorney).
The opinion of the court was delivered by WEINTRAUB, C.J.
The municipal ordinance provides that in connection with the final approval of a subdivision the municipality may accept a performance bond for the installation thereafter of improvements required for the development. The ordinance further provides for the release of a performance bond upon acceptance of the work and the filing of a "maintenance" bond. After plaintiffs filed such bonds, the local ordinance was amended to require a subdivider to give written notice to all property owners in the development of the time when they could be heard before the municipal council with respect to whether the condition of a performance bond or of a maintenance bond had been met. Plaintiffs contend (1) these amendments calling for notice to the property owners are invalid and (2) in any event there is no statutory authorization for the exaction of a maintenance bond. The trial court found for the municipality and we certified plaintiffs' appeal before argument in the Appellate Division.
The Municipal Planning Act (1953) provides in N.J.S.A. 40:55-1.21:
"Before final approval of plats the governing body may require, in accordance with the standards adopted by ordinance, the installation, or the furnishing of a performance guarantee in lieu thereof, of any or *424 all of the following improvements it may deem to be necessary or appropriate: street grading, pavement, gutters, curbs, sidewalks, street lighting, shade trees, surveyor's monuments, water mains, culverts, storm sewers, sanitary sewers or other means of sewage disposal, drainage structures, and such other subdivision improvements as the municipal governing body may find necessary in the public interest."
N.J.S.A. 40:55-1.22 authorizes the governing body to accept "adequate performance guarantees for the purpose of assuring improvements" referred to in the section just quoted, and N.J.S.A. 40:55-1.2 defines "performance guarantee" to mean "any security * * * including performance bonds, escrow agreements, and other similar collateral or surety agreements."
I
Turning first to the question whether a maintenance bond may be required, we note that the statute empowers the governing body to require "adequate" performance guarantees. Performance contemplates not only that the work be completed but also that it be done correctly. The municipality properly protected itself upon both scores. It could have required a single performance bond calling for completion and for continued liability, surviving acceptance, with respect to defective work and materials, or it could provide for two bonds, one to deal with the completion of the work and the other to continue liability with respect to defects in work or material. The municipality took the latter course. The so-called "maintenance" bond, which in amount is 10% of the performance bond, is limited to "all defects of material or workmanship in the said work" which may develop during the ensuing three years. The use of a second bond benefits the developer by reducing the amount of the secured liability in harmony with the spirit of N.J.S.A. 40:55-1.22. It also avoids an issue of construction which sometimes arises under a single performance bond as to whether acceptance of the work was intended to end liability for defects which later appear. See, 17 Am. Jur.2d, Contractors' Bonds, § 96, p. 274; cf. Annotation, 72 A.L.R. 644 (1931).
*425 The covenant being for repairs with respect to defective work or material, the maintenance bond did not impose upon the developer (and, through him, on the property owners) a liability for the "maintenance" of roads in the ordinary sense of the term, i.e., with respect to repairs due to wear and tear, and thus did not depart from the thesis of the statute that the developer (and through him his vendees) shall absorb the cost of the improvement itself as distinguished from its future maintenance. See, West Park Ave., Inc. v. Ocean Tp., 48 N.J. 122, 126 (1966), and Levin v. Livingston Tp., 35 N.J. 500, 514-515 (1961). The "maintenance" bond here involved is but a guarantee of performance. See, 13 McQuillin, Municipal Corporations (3d ed. 1950), § 37.113, pp. 371-372; Wilson v. Inhabitants of City of Trenton, 61 N.J.L. 599 (E. & A. 1898); Mueller v. Boulevard Comm'rs of Hudson County, 87 N.J.L. 702 (E. & A. 1915).
II
The other question is whether the municipality may provide for a hearing on notice to the owners of property within the development with respect to compliance by a subdivider with these performance bonds.
First plaintiffs say the Municipal Planning Act (1953) does not expressly authorize such a public hearing. That this is so is of no moment. The act provides that it "shall be construed most favorably to municipalities, its intention being to give all municipalities the fullest and most complete powers possible concerning the subject matter hereof." N.J.S.A. 40:55-1.3. Surely the governing body may reserve to itself the right to decide for the municipality whether it should release a bond. That power is implicit in the nature of the subject and as well in N.J.S.A. 40:55-1.22 which provides that "the governing body by resolution" may reduce the amount of a performance guarantee and extend time for performance. A municipality may, if it is so minded, provide for public notice with respect to the adoption of a resolution. In their supplemental brief filed after argument, *426 plaintiffs conceded that power and shifted their complaint to the imposition upon the developer of the burden of giving the notice. That burden is trivial in its dollar demand, and we see no reason to deny the municipality the power to impose it as an incident of a performance guarantee.
We see no substance to the claim that the amendments to the ordinance are constitutionally infirm because they lack a standard for the ultimate action of the governing body. The standard is compliance with the condition of the bond. Nor is there an invidious classification because notice is required to be given only to a part of the public, i.e., the owners of property in the development. Those owners have a distinctive interest in that as a practical matter they paid for the public improvement via the purchase price for their properties. They also are specially well situated to know whether defects in the work have appeared.
Finally plaintiffs challenge the power of the municipality to apply the amendments retroactively to existing bonds. Plaintiffs say the effect is to enlarge their obligations after final approval contrary to the intent of the statute, Levin v. Livingston Tp., supra, 35 N.J., at pp. 516-517; Pennyton Homes, Inc. v. Planning Board of Borough of Stanhope, 41 N.J. 578, 585 (1964), and also to impair the obligation of contract in violation of the New Jersey Constitution, Art. IV, § 7, ¶ 3.
Both objections assume that under the ordinance prior to the amendments and also under the terms of the bonds, the improvements had to be installed only to the satisfaction of the township engineer, whereas under the amendments the governing body too must be satisfied. As to the ordinance, the amendments do not purport to modify the condition of the bonds or the general provisions dealing with the responsibility of the township engineer. As to the bonds themselves, the performance bond expressly requires performance "to the satisfaction of the Township Engineer" whereas the maintenance bonds do not contain that provision. At any rate, we see no need to decide the precise impact of a decision by the *427 township engineer. It was always within the authority of the governing body as the obligee upon the bonds to decide whether to accept the performance or to challenge its sufficiency. This was so whether or not the decision of the township engineer would be binding upon the parties in the event of litigation. The amendments merely provide for a hearing at which the governing body, and the township engineer as well, could well obtain helpful information with regard to their respective decisions.
Insofar as plaintiffs may be asserting that their obligation is invalidly enlarged by the retroactive requirement that they undertake the chore of sending notices to the owners of property within the development, we repeat that the burden is trivial. It relates only to the procedure for obtaining the acknowledgment by the governing body that the obligation of the bond has been performed; it does not add to the substance of that obligation. Cf. Pennsylvania Greyhound Lines, Inc. v. Rosenthal, 14 N.J. 372 (1954); 5 McQuillin, Municipal Corporations (3d ed. 1949), § 19.48, p. 599. Nor would it comfort plaintiffs at all if the municipality itself sent the notices to the property owners. Plaintiffs' real complaint is that a notice of hearing as to the performance bonds invites claims by their purchasers with respect to unrelated things, which, say plaintiffs, could distract a governing body, aware of the power of the voter, from the true question before the meeting. We need hardly say that local government may not be denied an appropriate power for fear that some governing body may not be equal to the responsibility it entails.
The judgment is affirmed.
For affirmance Chief Justice WEINTRAUB and Justices FRANCIS, PROCTOR, HALL, SCHETTINO and HANEMAN 6.
For reversal None. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534820/ | 5 B.R. 539 (1980)
In re FAST FOOD PROPERTIES, LTD. # 1, a limited partnership, Debtor.
Bankruptcy No. SA-80-01783-PE.
United States Bankruptcy Court, C.D. California.
July 21, 1980.
*540 Andrew P. Katnik, Santa Ana, Cal., for debtor.
Norman L. Hanover, San Bernardino, Cal., for Su-Jac Enterprises, a creditor.
MEMORANDUM OF DECISION AND ORDER DISMISSING CHAPTER 11 CASE
PETER M. ELLIOTT, Bankruptcy Judge.
The debtor filed a Chapter 11 case on July 11, 1980. The debtor has no unsecured creditors and only two secured creditors, the Small Business Administration, assignee of Security Pacific National Bank holding a note secured by a first trust deed on the debtor's property, and Su-Jac Enterprises holding an installment note secured by a second trust deed.
On July 17, 1980 Su-Jac filed a complaint for relief of stay against the debtor, adversary proceeding No. SA-80-0444-PE. On July 18, 1980 I heard Su-Jac's motion for an ex parte relief of the automatic stay which was opposed by the debtor.
It appears from the verified complaint in the adversary proceeding that the debtor is delinquent on the first trust deed for monthly payments due January 1, 1980 and all subsequent months at the rate of $3,407 per month for a total of $23,849. In addition, Su-Jac has advanced to the SBA and for foreclosure costs the sum of $23,530 in order to protect their second position.
Real property taxes in the amount of $5,766 are delinquent. The debtor has sought to restrain the foreclosure in the Superior Court, and the Superior Court has dissolved all restraining orders effective July 10, 1980.
It is obvious to me that this Chapter 11 case was filed solely for the purpose of frustrating the enforcement of the power of sale provision under Su-Jac's deed of trust and that the Chapter 11 case should be dismissed.
The first question which must be answered is whether this court's authority to dismiss a Chapter 11 case is limited to the grounds specified in 11 U.S.C. § 305(a). That section provides:
(a) The court, after notice and a hearing, may dismiss a case under this title, or may suspend all proceedings in a case under this title, at any time if
(1) the interests of creditors and the debtor would be better served by such dismissal or suspension; or
(2)(A) there is pending a foreign proceeding; and
(B) the factors specified in section 304(c) of this title warrant such dismissal or suspension.
Under the Bankruptcy Act of 1898, the bankruptcy court, without express statutory authority, dismissed bankruptcy cases which were filed improperly or for an improper purpose.
In re Ettinger, 76 F.2d 741 (2d Cir. 1935), states:
Also, it is the duty of the court sua sponte when it believes its jurisdiction may have been imposed upon to inquire into the facts and act in accordance therewith.
See also Porterfield v. Gerstel, 222 F.2d 137 (5th Cir. 1955).
It would appear then that a court of bankruptcy has always had the inherent power to dismiss a case which imposed upon its jurisdiction. The whole thrust of the Bankruptcy Reform Act of 1978 is to expand the jurisdiction of the bankruptcy court, not to restrict it. It follows that 11 U.S.C. § 305 does not restrict my power to dismiss, but rather enlarges it. Therefore, on my own motion,
IT IS ORDERED that the above entitled Chapter 11 case is dismissed.
This dismissal renders moot any decision on the complaint for relief of stay in the matter of Su-Jac v. Fast Food Properties. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534815/ | 813 S.W.2d 746 (1991)
Henry Lee CARTER, Appellant,
v.
The STATE of Texas, Appellee.
No. 01-90-00843-CR.
Court of Appeals of Texas, Houston (1st Dist.).
July 25, 1991.
Thomas J. Lewis, Houston, for appellant.
John B. Holmes, Harris Co. Dist. Atty. and J. Harvey Hudson, Asst. Harris Co. Dist. Atty., for appellee.
Before TREVATHAN, C.J., DUNN, J., and FRANK C. PRICE, Former Justice[1], Assigned.
OPINION
TREVATHAN, Chief Justice.
This is an appeal from assessment of punishment by the trial court. We affirm.
On January 15, 1977, appellant was convicted by a jury of five counts of aggravated robbery. The jury imposed punishment of life imprisonment for count one and 99 years for counts two, three, four, and six. Count five was dismissed prior to the punishment phase of the trial. All sentences were to run concurrently. Appellant began serving his sentences in December of 1977. In August of 1990, the United States District Court for the Southern District of Texas set aside appellant's sentences and allowed the State a retrial on punishment. On September 17, 1990, the trial court reheard *747 the punishment phase of the 1977 convictions, and appellant was sentenced by the court to 50 years confinement in the Institutional Division of the Texas Department of Criminal Justice.
In 1990, at appellant's punishment hearing, the State introduced a penitentiary packet that included appellant's 1986 conviction for possession of a deadly weapon in a penal institution. Counsel for appellant objected to this evidence, stating that it did not constitute a "prior" conviction, but was a "subsequent" conviction, since the conviction occurred after appellant was found guilty in the instant case.
In 1977, Texas Code of Criminal Procedure, article 37.07, section 3(a) provided:
Regardless of the plea and whether the punishment be assessed by the judge or the jury, evidence may be offered by the state and the defendant as to the prior criminal record of the defendant, his general reputation and his character. The term prior criminal record means a final conviction in a court of record, or a probated or suspended sentence that has occurred prior to trial, or any final conviction material to the offense charged.
This version of article 37.07 was in effect at the time appellant was convicted in 1977.
In 1987, article 37.07, section 3(a) was amended to state:
Regardless of the plea and whether the punishment be assessed by the judge or the jury, evidence may, as permitted by the Rules of Evidence, be offered by the state and the defendant as to any matter the court deems relevant to sentencing, including the prior criminal record of the defendant, his general reputation and his character. The term prior criminal record means a final conviction in a court of record, or a probated or suspended sentence that has occurred prior to trial, or any final conviction material to the offense charged.
Tex.Code Crim.P.Ann. art. 37.07, § 3(a) (Vernon Supp.1991) (emphasis added). The trial court used the amended version of article 37.07 to consider evidence of the 1986 conviction at the punishment phase of the trial.
Appellant brings forward one point of error, contending that the trial court erred in admitting evidence that appellant was convicted of a felony subsequent to the guilt/innocence phase of the trial. Appellant argues that application of the statute in effect in 1977 would have barred the State from introducing evidence of a subsequent felony conviction at the punishment phase of the trial in 1990. Appellant maintains that application of the 1987 amendment to the punishment phase of trial for the 1977 convictions is barred by federal and state constitutional prohibitions on ex post facto laws.[2]
An ex post facto law is one that: (1) punished as a crime an act previously committed, which was innocent when done; (2) makes more burdensome the punishment for a crime, after its commission; or (3) deprives one charged with a crime of any defense available according to law at the time when the act was committed. Dobbert v. Florida, 432 U.S. 282, 97 S. Ct. 2290, 2298, 53 L. Ed. 2d 344 (1977); Beazell v. Ohio, 269 U.S. 167, 169-70, 46 S. Ct. 68, 68-69, 70 L. Ed. 216 (1925).
Laws that do not amend substantive law by defining criminal acts or providing for penalties are procedural in nature. Ex parte Johnson, 697 S.W.2d 605, 607 (Tex. Crim.App. 1985). Unless a remedy is extinguished or so encumbered with conditions that its application is rendered useless, a law that merely affects a remedy or a procedure is not within the scope of the prohibition against retroactive laws. Ex parte Roper, 61 Tex. Crim. 68, 134 S.W. 334, 339 (1911).
We hold that article 37.07 is a procedural statute, as it involves only the admissibility of evidence and affects no change in substantive law. See Hubbard v. State, 809 S.W.2d 316 (Tex.AppFort Worth 1991, pet. filed); Huggins v. State, 795 S.W.2d 909 (Tex.App.Beaumont 1990, pet. ref'd). Even though procedural changes may work to the disadvantage of *748 an accused, such changes do not violate the constitutional ex post facto prohibition. Collins v. Youngblood, ___ U.S.___, 110 S. Ct. 2715, 2720, 111 L. Ed. 2d 30 (1990).
Absent an express provision to the contrary, procedural statutes control litigation from their effective date and apply to litigation that is pending. Wade v. State, 572 S.W.2d 533, 534 (Tex.Crim.App.1978); Cooper v. State, 769 S.W.2d 301, 306 (Tex. App.Houston [1st Dist.] 1989, pet. ref'd). The amended version of article 37.07 applied to evidence that was introduced at appellant's punishment hearing.
We overrule appellant's point of error and affirm the judgment of the trial court.
NOTES
[1] The Honorable Frank C. Price., former justice, Court of Appeals, first District of Teaxes at Houston, sitting by assignment.
[2] U.S.Const. art. 1, § 9, cl. 3; Tex.Const. art. 1, § 16. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534819/ | 813 S.W.2d 548 (1991)
CHARLES L. HARDTKE, INC., Appellant,
v.
Abe KATZ, Appellee.
No. 01-90-00600-CV.
Court of Appeals of Texas, Houston (1st Dist).
May 23, 1991.
Rehearing Overruled July 25, 1991.
*549 Drew M. Capuder, Houston, for appellant.
R.F. Margolin, Houston, for appellee.
Before COHEN, WILSON and DYESS,[1] JJ.
OPINION
COHEN, Justice.
The question presented is whether the trial court's specific, timely, initialed docket entry can set aside its prior order dismissing this case for want of prosecution. Under this record, we hold that it can. Consequently, we reverse and remand.
Charles L. Hardtke, Inc. (Hardtke) sued Abe Katz for breach of a loan guaranty. The trial court dismissed the suit for lack of jurisdiction in 1990, concluding that it had long before been finally dismissed for want of prosecution. The first dismissal for want of prosecution was on August 28, 1986. An order of reinstatement followed. The second dismissal was on March 11, 1987. We must decide whether the trial court succeeded in its two attempts to set aside the dismissals and reinstate the case. If either attempt failed, then the trial court had no jurisdiction in 1990.
I. The first dismissal for want of prosecution on August 28, 1986
On June 2, 1986, the trial judge, Thomas R. Phillips, ordered the parties to file a joint status report by July 15, 1986 or the suit would be dismissed, pursuant to Tex.R.Civ.P. 165a. On August 28, 1986, the trial court dismissed the case for want of prosecution because Hardtke failed to comply with its order. Hardtke's motion to reinstate was filemarked October 3, 1986, 34 days after the dismissal order. A motion to reinstate filed 34 days after dismissal is not timely. Rule 165a(3) requires that such motion be filed within 30 days. Nevertheless, the trial judge signed an order reinstating the case on October 17, 1986.
If the record were clear that Hardtke's motion to reinstate was, in fact, not filed until October 3, 1986, we would hold that the August 28 dismissal was final and that the trial court properly dismissed for lack of jurisdiction. The record, however, strongly indicates that Hardtke's motion was actually filed timely on September 26, 1986, but was not filemarked until October 3. The cover letter from Hardtke's attorney, asking the clerk to file the motion to reinstate, contains a certificate of service and a notary's verification, both dated September 25, 1986. The cover letter is dated September 25, 1986, and it bears a filemark by the District Clerk of September 26, 1986. The trial judge acted as though the motion was timely filed, and Katz never contended in the trial court, or even in his appellate brief, that the motion was not timely. This Court notified the parties of this potential lack of jurisdiction.
We conclude that, under these circumstances, the ambiguity in the record should be resolved in favor of jurisdiction. Therefore, we hold that Hardtke's motion to reinstate was filed timely, within 30 days of the dismissal of August 28, 1986, which gave the trial court authority to reinstate the case by its order of October 17, 1986.
II. The second dismissal for want of prosecution on March 11, 1987
Hardtke's point of error asserts the trial court erred in dismissing in 1990 for lack of jurisdiction because the court had validly reinstated the case after the dismissal of March 11, 1987.
On February 4, 1987, the trial judge ordered a joint status report to be filed by March 10,1987. The order stated the court had never received a status report pursuant *550 to its June 2, 1986 order and that the suit would be dismissed for want of prosecution if no status report was filed by March 10, 1987. A joint status report was filed on March 10, at 3:30 p.m. Unaware of that filing, the trial judge, on March 11, 1987, signed an order dismissing for want of prosecution for failure to comply with his order of February 4, 1987. This dismissal was based on the trial court's erroneous assumption that Hardtke had not complied, even though Hardtke had complied by filing the joint status report the previous day, as required.
Hardtke never filed a motion to reinstate after the March 11 dismissal. Nevertheless, Hardtke contends the case was reinstated on the court's own motion and order. There is no conventional "order" in our record setting aside the March 11, 1987 dismissal. Hardtke relies on two significant documents. The first is a docket entry dated "3-12-87," which states, "Order of 3-11-87 struck; case removed from special dismissal docketTRP." The initials are those of the trial judge, Thomas R. Phillips. In addition, Judge Phillips signed an order on April 3, 1987, setting the case for trial. Hardtke argues that the docket entry and the trial setting order, taken together, show unambiguously, and in a writing signed by the trial judge, that the trial judge set aside the dismissal of March 11 and granted a new trial.
When, as here, there is a time limit on the court's jurisdiction, its order must be in writing, specific, and signed by the trial judge. Walker v. Harrison, 597 S.W.2d 913, 915 (Tex.1980). Once a judgment is signed, a second, inconsistent judgment in the same case does not automatically vacate the former judgment. The second judgment must show that the first judgment has been set aside; otherwise, the second judgment is a nullity. Mullins v. Thomas, 136 Tex. 215, 217, 150 S.W.2d 83, 84 (1941).
The March 12 docket entry here is in writing, is specific, and is signed with the initials of the trial judge, as Walker v. Harrison requires. It specifically sets aside the dismissal order of March 11,1987, as Mullins v. Thomas requires. Although the docket entry is unambiguous, and therefore needs no explanation, the trial judge's understanding of its meaning is shown by the fact that he signed an order approximately three weeks later setting the case for trial.
We hold that the docket entry bears the requisites of specificity and authenticity sufficient to entitle it to dignity as an "order" vacating the March 11 dismissal. The trial judge's sua sponte order on March 11 was a mistake that he immediately tried to correct. The law should encourage, not frustrate, reasonable steps to correct routine administrative errors that inevitably occur in even the most well-managed courts. There being no doubt as to the timing, the meaning, or the authenticity of the March 12 docket entry, it would be manifestly unjust to deny it the effect that the trial judge obviously intended it to have and thereby cause Hardtke to suffer for an error that it did not cause and was in no position to correct.[2]
Several supreme court cases hold that, at least in some circumstances, a docket entry cannot set aside a judgment. We consider these cases to be distinguishable. In Clark & Co. v. Giles, 639 S.W.2d 449, 450 (Tex.1982), a docket entry joined with an oral order granting a motion for new trial was held insufficient to set aside a money judgment. That holding was compelled by Tex.R.Civ.P. 329b(c), which expressly required a signed written order to grant a motion for new trial. Rule 329b does not apply here because no motion for new trial was filed. Four different parts of rule 329b refer to new trial motions "filed" or "if filed"; rule 329b(a), (b), (e), (g). Subsection (c), the basis for the holding in Clark, refers to "an original or amended motion for new trial." In Clark, *551 there was one; here, there is not. Judge Phillips simply cured his error, without any motion or hearing, as he was entitled to do in the exercise of his plenary power. Tex. R.Civ.P. 320, 329b(d).
In Emerald Oaks Hotel/Conference Center, Inc. v. Zardenetta, 776 S.W.2d 577, 578 (Tex.1989), the court held a docket entry and oral order could not be used in lieu of a written order to reinstate a case dismissed for want of prosecution. That holding was compelled by Tex.R.Civ.P. 165a(3), which expressly required that a motion to reinstate "shall be filed" and overruled by law after 75 days unless "decided by a signed written order____" Rule 165a(3) does not apply here because no motion to reinstate was filed. The rule requires a "filed," "verified" motion that "shall set forth the grounds therefor," that "shall be served" on the parties, that "shall" be delivered by the clerk to the judge, who "shall set a hearing ... [and] shall notify all parties ... of the hearing." None of that happened here because this was not a proceeding conducted under rule 165a(3).
This case is not governed by Walker v. Harrison because there the court ruled on a pending motion to reinstate. 597 S.W.2d at 914-15. Under case law then, as under rule 165a(3) now, a motion to reinstate could be granted only by "written order." Id. at 916. Moreover, the party seeking reinstatement in Walker made the dubious claim that its motion was granted by a docket entry that said it was "denied." Id. at 915. Finally, the docket entry in Walker vaguely promised some conditional future relief, but none was granted until six months after the trial court's plenary power had expired. Id. at 916 n. 2. Here, the docket entry was timely, it did not refer to future orders, it unambiguously granted specific relief, and it was not governed by rule 165(a)(3) because no motion to reinstate was pending.
Nor is N-S-W Corp. v. Snell, 561 S.W.2d 798 (Tex.1977), controlling. In N-S-W, the disregarded docket entry was ambiguous, it had obviously been altered, the parties disputed the authenticity of its date, and it granted reinstatement "as per order," but, as in Walker v. Harrison, the required future order came too late. Id. at 798-99. See Reese v. Piperi, 534 S.W.2d 329, 330 (Tex.1976) ("The judge's intention to render judgment in the future cannot be a present rendition of judgment."). The docket entry here has no such defects. N-S-W Corporation sought to use the questionable docket entry to change the date of a reinstatement order so that it would be timely, i.e., within the trial court's plenary power. The supreme court wrote, "[T]he docket entry may not impeach the court's order.... A docket entry ... cannot be used to contradict or prevail over a final judicial order." Id. at 799. "The rule [in N-S-W] properly interpreted, means that a docket entry of what the judgment purports to be cannot override or cast doubt upon the written judgment, where the two are different." Energo Int'l Corp. v. Modern Indus. Heating, 722 S.W.2d 149, 153 n. 2 (Tex.App. Dallas 1986, no writ) (Akin, J., dissenting) (emphasis added). In this case, we are not using the March 12 docket entry as evidence of what the March 11 judgment purports to be. The two are entirely separate, and the meaning of each is clear.
It has been said that "[D]ocket entries are inherently unreliable." Energo, 722 S.W.2d at 151 n. 2. This one is not. It is more reliable than the mistaken order it strikes. It should be given effect in order to avoid injustice. Tex.R.Civ.P. 1. Doing so does not offend the policies underlying the decisions of our supreme court.
A signed docket entry is effective as a judgment dismissing a case for want of prosecution. Knox v. Long, 152 Tex. 291, 297, 257 S.W.2d 289, 292 (Tex.1953) (signed docket entries dismissed 180 cases). We hold, under these facts, that Judge Phillips' signed docket entry was effective as a judgment reinstating the case.
Hardtke's point of error is sustained. The judgment is reversed, and the cause is remanded.
NOTES
[1] The Honorable Arthur D. Dyess, former Justice, Court of Appeals, First District of Texas at Houston, sitting by assignment.
[2] Because the trial judge acted on his own motion, the record does not show that Hardtke ever knew the case was under consideration for dismissal on March 11 or for reinstatement on March 12. Nor does the record show that Hardtke ever knew in time to act that the trial judge had either dismissed the case on March 11 or reinstated it on March 12. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534826/ | 813 S.W.2d 698 (1991)
Demetric ADAMS, Appellant,
v.
The STATE of Texas, Appellee.
No. 01-90-00581-CR.
Court of Appeals of Texas, Houston (1st Dist.).
July 18, 1991.
Discretionary Review Refused October 30, 1991.
Michael P. Fosher, Houston, for Adams.
John B. Holmes, Jr., Harris Co. Dist. Atty., Carol Cameron and Craig Goodhart, Asst. Harris Co. Dist. Attys., for State.
Before TREVATHAN, DUNN and DUGGAN, JJ.
OPINION
DUGGAN, Justice.
A jury found appellant guilty of the unauthorized use of a motor-propelled vehicle, found the allegations in two enhancement *699 paragraphs to be true, and assessed punishment at 65 years confinement. Appellant brings two points of error on appeal. We affirm.
In point of error one, appellant contends that the evidence is insufficient to sustain his conviction because there is a fatal variance between the person named in the indictment as the owner of the car, and the proof of the complainant at trial.
The indictment provides, in relevant part:
It is further presented that in Harris County, Texas, DEMETRIC ADAMS, hereafter styled the Defendant, heretofore on or about APRIL 2, 1990, did then and there intentionally and knowingly operate a motorpropelled vehicle, namely, an automobile owned by PEARLIE MAE HELITON, hereafter styled the Complainant, without the effective consent of the Complainant.
(Emphasis added). The transcript of the court reporter's notes reflects that Pearlie Mae Heliton was sworn in for the State.[1] Thereafter, the court reporter's notes reflect the complainant's name as being "Heilton."
Appellant contends that the prosecutor called the complainant "Mrs. Heilton" and that the complainant stated her name as being "Pearlie Mae Heilton." If there was a variance between the indictment and the proof of the complainant's name at trial, appellant failed to object to it. However, there has been no showing that the complainant was known as "Heilton." The complainant was not asked to spell her name during direct or cross-examination; thus, the change in spelling could be the result of the court reporter misspelling the complainant's name.
Under the rule of "idem sonans," if names may be sounded alike without doing violence to the power of the letters found in the variant orthography, then any variance or misspelling is immaterial. Martin v. State, 541 S.W.2d 605, 608 (Tex.Crim. App.1976); Hilson v. State, 751 S.W.2d 279, 280 (Tex.AppHouston [1st Dist.] 1988, no pet.). Questions involving the rule of "idem sonans" must be raised in the first instance at trial. Martin, 541 S.W.2d at 608; Hilson, 751 S.W.2d at 281. Where the issue is raised for the first time on appeal, it will be treated as having been waived and will present nothing for review. Martin, 541 S.W.2d at 608. Appellant concedes that he failed to object to the alleged variance at trial. Thus, having failed to object to the alleged variance at trial, appellant presents nothing for review.
Point of error one is overruled.
In point of error two, appellant contends that the prosecutor's final argument during the punishment stage of the trial was so prejudicial that an instruction to disregard would not have cured the harm. During final argument the prosecutor stated:
By your verdict you've already said one thing. The man is a liar. He got on the stand. He told you. You found him guilty. He told you a story. You obviously didn't believe him.
....
Look at his attitude towards you when he sat on the witness stand and lied to you by making up a story.
Appellant did not object to this argument, and thus is complaining of the alleged error for the first time on appeal.
It is well settled that impropriety in the State's argument is waived by a defendant's failure to make a proper and timely objection. Romo v. State, 631 S.W.2d 504, 505 (Tex.Crim.App.1982); Archer v. State, 414 S.W.2d 484, 485 (Tex.Crim.App.1971). An exception to this rule occurs when the argument of the prosecutor is so prejudicial that an instruction to disregard will not cure the harm. Id.
After reviewing the argument of the prosecutor, we cannot say that the alleged error was so prejudicial that it could not have been cured by an instruction from the court.
Further, the prosecutor's argument was proper. To be permissible, jury argument must fall within one of the following *700 areas: (1) summation of the evidence; (2) reasonable deductions from the evidence; (3) answer to argument of opposing counsel; and (4) plea for law enforcement. Albiar v. State, 739 S.W.2d 360, 362 (Tex.Crim.App.1987). Even if argument exceeds the bounds of proper jury argument, it is not reversible error unless, in light of the record as a whole, the argument is extreme, manifestly improper, violative of a mandatory statute, or injects new facts harmful to the accused into the trial proceeding. McKay v. State, 707 S.W.2d 23, 36 (Tex.Crim.App.1985), cert, denied, 479 U.S. 871, 107 S. Ct. 239, 93 L. Ed. 2d 164 (1986).
The complainant, Pearlie Mae Heliton, testified that she parked her 1982 tan Buick Riviera in the parking lot of the Jewish Geriatric Center Nursing Home at 6200 North Braeswood at approximately 7:55 a.m. on April 2,1990. At approximately 1:40 p.m., the police notified the complainant that her car had been stolen and recovered.
Sergeant Gary Lee Pikett testified that at 12:50 p.m. on April 2, 1990, he saw appellant driving a 1982 tan Buick on Bellaire Boulevard. Appellant was exceeding the posted speed by 35 m.p.h. Sergeant Pikett pursued the vehicle and attempted to pull the vehicle over. Appellant fled for approximately three blocks before pulling into an apartment parking lot. He then jumped out of the car while the car was still traveling at approximately 10 miles per hour and fled on foot. Pikett pursued appellant down the bayou for approximately one quarter mile until appellant jumped over a fence into a backyard. While waiting for additional officers to arrive, Pikett enlisted the assistance of City of Houston Water Department employees to maintain the perimeter of the backyards. Upon the arrival of additional officers, a search was conducted of the backyards. Appellant was located beneath a bush and placed under arrest.
Sergeant Pikett then returned with appellant to the Buick and observed that the steering column had been broken and that chips from the steering column were located on the drivers side floorboard. Pikett stated that there were no keys in the ignition and that there were two screwdrivers on the passenger side floorboard. Pikett stated that these findings are consistent with an automobile having been stolen.
During direct examination, appellant testified that he believed the vehicle belonged to his friend Craig White, and that White had given him permission to drive the vehicle. He denied fleeing from the police and stated that he pulled over as quickly as he could. Appellant stated that when he got out of his car, the officer told him he had run a red light, so appellant ran from the officer. He testified that he ran from the officer because he thought the officer had a blue warrant on him for not reporting to his parole officer and for failing to make his payments. He stated that the steering wheel column was not broken, and that there were keys in the ignition.
On cross-examination, appellant denied running from the police because he suspected the vehicle had been stolen. He stated that he did not see chips from the steering column on the floor of the vehicle, nor did he see two screwdrivers on the passenger floorboard.
It is well settled that a prosecutor may argue his opinions concerning issues in the case so long as the opinions are based on the evidence in the record and do not constitute unsworn testimony. McKay, 707 S.W.2d at 37. Counsel may on argument draw from the facts in evidence all inferences that are reasonable, fair, and legitimate, and he will be afforded great latitude without limitation in this respect so long as his argument is supported by the evidence and offered in good faith. Griffin v. State, 554 S.W.2d 688, 690 (Tex.Crim. App.1977).
Here, the above argument of counsel fell within the bounds of proper jury argument as a reasonable deduction from the evidence. Appellant's testimony during guilt/innocence was directly contrary to the testimony of Sergeant Pikett. The jury could not have believed appellant and still found him guilty. Thus, the prosecutor's statement during argument at the punishment *701 phase was a reasonable deduction from the evidence and from the jury's verdict of guilty.
Moreover, during argument at the guilt/innocence phase, appellant's counsel argued that the issue at the guilt/innocence stage rested upon whether the jury believed appellant's testimony. Because the jury found appellant guilty of the offense, they necessarily found, as appellant's attorney had reasoned in argument, that appellant was not telling the truth. Thus, the prosecutor's statement during argument at the punishment phase was made in response to argument by counsel for appellant and in light of the earlier guilty verdict returned by the jury.
Point of error two is overruled.
The judgment is affirmed.
NOTES
[1] The record expressly recites that: "Pearlie Mae Heliton, having been previously sworn to tell the truth, the whole truth, and nothing but the truth, testified as follows: ..." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534811/ | 5 B.R. 112 (1980)
In re NASHVILLE WHITE TRUCKS, INC. (a/k/a Mobile Truck & Trailer Service, Inc.), Debtor.
WHITE MOTOR CORPORATION, Plaintiff,
v.
NASHVILLE WHITE TRUCKS, INC. (a/k/a Mobile Truck & Trailer Service, Inc.), Defendant.
Bankruptcy No. 380-00080, Adv. No. 380-0213.
United States Bankruptcy Court, M.D. Tennessee.
June 20, 1980.
*113 *114 I. C. Waddey, Jr., Nashville, Tenn., for defendant.
Thomas J. Sherrard, William R. O'Bryan, Jr., Nashville, Tenn., for plaintiff.
MEMORANDUM
PAUL E. JENNINGS, Bankruptcy Judge.
This matter is before the court upon complaint of the creditor White Motor Corporation for relief from the stay of 11 U.S.C. § 362 to permit termination of a lease and for a declaratory judgment concerning expiration of a dealer sales and service agreement with the debtor. The following shall constitute findings of facts and conclusions of law pursuant to Rule 752, F.R.B.P.
On or about January 30, 1978, plaintiff White Motor Corporation (hereinafter White) and defendant Nashville White Trucks, Inc. (hereinafter debtor or NWT) entered into a Dealer Agreement, appointing the latter an authorized dealer for White trucks, accessories and parts. The contract required the debtor to maintain certain working capital (Section B.1), to submit to White monthly financial statements (Section B.3), to carry in stock an adequate inventory of unassigned new trucks and an adequate inventory of accessories and parts (Section B.4). Under Section B.1 the dealer was not permitted to change location without the prior written consent of White. The contract also provided for termination at any time by mutual consent of the parties, for termination by either party upon thirty days notice, or for termination upon the happening of certain specified events (Section D.1). Section E.9 provided that the agreement was to continue in effect for a period of two years and to end on January 29, 1980, unless sooner terminated by either party as provided in D.1 and D.2; upon the expiration date the agreement was to terminate automatically without notice.
On or about June 1, 1978, White and the debtor entered into a lease agreement covering certain improved real property at 1321 Foster Avenue, Nashville, Tennessee, for a period of five years commencing June 1, 1978, and ending May 31, 1983. These premises were to be used for the sale, service and storage of motor vehicles (section 5). The agreement also provided for termination of the lease by thirty days written notice upon termination of the dealer selling agreement. Section 24 prohibited subletting or assignment of the lease without the prior written consent of the lessor which was not to be unreasonably withheld.
Problems between White and the debtor developed almost immediately. Payments on the lease were routinely late. Testimony at trial revealed that between June, 1978, and the present, NWT has been delinquent in lease payments a total of 365 days. Exh. 1. Because of delinquencies in payment on open account for parts, NWT was put on a cash basis in November, 1978, and has continued on such to date. The required monthly financial statements were not submitted regularly; there was a gap from August, 1978, to July, 1979, except for a December, 1978, audited statement prepared in September, 1979. Exh. 4. NWT did not have a floor plan arrangement after May, 1979. Prior to that date NWT was found to be substantially out of trust. This matter was resolved between the parties and NWT was allowed to repay the amount over a period of months. Working capital requirements as originally proposed were not met. A number of cash advances were made by NWT to the principals of NWT and to other corporations owned by them.
In an effort to work out these problems, the parties held a number of meetings in late 1979. A meeting in September resulted *115 in a plan of action to be taken by NWT to be reinstated on open account for parts purchases. Another meeting on October 17, 1979, was attended by T.G. Wilson and W.J. Wilson, president and vice-president of NWT respectively, George Kenyon, vice-president for the Southeastern Region of White, George Flynn, Regional Business Manager for White, and John Hill, District Sales Manager for White. At that time the parties agreed to have arrangements completed for establishing open account and wholesale finance accommodations by December 1, 1979.
At the September meeting the Wilsons had agreed to take certain action to improve the financial picture of NWT. Included were the sale of a Black Angus herd, sale of land owned by Cedarmont Farm, Inc., and sale of stock in Harpeth Savings and Loan. Proceeds of the various sales were to be used to pay off cash advances by NWT to the Wilsons and other corporations owned by them. During the fall the proposed sale of the cattle was held, resulting in the payment of approximately $130,000 to NWT, clearing some of the accounts in question from the books. Sale of a substantial portion of the Farm was accomplished but did not produce a surplus above the amount of the various mortgages; sale of the remaining portion of the Farm has not been made. Sale of the saving and loan stock was blocked by inability to obtain federal approval.
A meeting was held on December 3, 1979, attended by W.J. Wilson, Kenyon and Hill. During that meeting Wilson saw the 1980 marketing plan prepared by Hill in which he recommended among other things replacement of the dealer unless all areas of dealer operations were improved. Wilson's reaction was one of indignation and subsequent discussions were cut off. Wilson testified Hill was unable or unwilling to explain the basis of that recommendation or even the production goals which were being proposed. Having heard the testimony of Mr. Hill the court understands Mr. Wilson's testimony. Mr. Hill was either unable or unwilling to answer questions presented at trial. His testimony was of no benefit in this trial.
The parties met again on December 10, 1979. This meeting was attended by W.P. Holzworth, Director-Dealer Operations, and Ed Knoll, Manager of Dealer Financial Development. Holzworth testified that the purpose of the meeting was to discuss the failure of NWT to achieve the objectives set in the October meeting and pursue possible remedies. Wilson stated that he interpreted the visit by the White officials to be conciliatory in nature since the December 3 meeting had been heated. Wilson stated that Holzworth assured him at this meeting that the termination of the dealership would not occur. Holzworth testified that he assured Wilson that the termination would not occur IF the problems identified during the series of meetings were worked out. Holzworth also offered his help in attempting to set up wholesale financing with White Motor Credit Corporation but was not successful. From testimony the court concludes Wilson properly perceived the purposes of the meeting and was probably justified in concluding there was no immediate concern as to cancellation. White never advised a cancellation was forthcoming unless NWT corrected the problem areas. Clearly, Hill had not so informed NWT as he is totally incapable of making such a positive statement in a face to face discussion.
On January 5, 1980, an interoffice telegram was sent by Holzworth to Kenyon reading "Nashville Tennessee dealers sales and service agreement expires on January 29, 1980. Please advise this office as to the desired renewal term in order for us to send out the pages for signature." At trial Holzworth stated that the inquiry was made by clerical personnel in the office in a routine checking of expiration dates and not at his personal direction.
On January 10, 1980, NWT filed a voluntary petition in bankruptcy. W.J. Wilson notified White of the filing. On January 14, White initiated the "Request for Prior Approval Cancellation of Dealer Sales and Service Agreement." The request stated *116 that the termination was desired because of "D(c)(3)", referring to the paragraph in the Dealer Agreement which allows White to terminate upon the institution of involuntary or voluntary bankruptcy proceedings. The request also summarized the history of the dealership and the problems incurred.[1]
The proof is positive that the regional office has an important role in determining whether there is to be a franchise renewal. Indeed the testimony is that this recommendation is accepted by the home office. The testimony of Kenyon is that the operation of NWT was of continuing concern to White and that no decision to renew or revoke the franchise was finally made until early January. The parties testified that franchise relationships were designed to be continuing and were cancelled only as a last resort.
The indecision of White is reflected by the response to the Holzworth telex. Receipt of the telex resulted in Kenyon's office contacting Holzworth and in effect saying it is not a renewal term that is needed but a determination of whether there is to be a renewal.
White has filed a complaint for relief from the automatic stay of § 362 to permit termination of the lease and for a declaratory judgment concerning expiration of the dealer agreement. Trial was held May 15, 16 and 23. Testimony by White concentrated on the problems outlined previously. Additionally there was testimony as to the failure of NWT to meet assigned quotas.
Each of the witnesses for White testified that the failure to meet quotas, lack of a floor plan arrangement or lack of open account for parts would not individually constitute sufficient reasons for termination of the agreement. The evidence does not establish that either the sales or the service provided by NWT was inadequate or unsatisfactory. Testimony by NWT concentrated on the efforts by the Wilsons to achieve the identified objectives, the assurances by White officials during the various visits and the documents stating the reason for the termination to be the filing of bankruptcy January 10.
An attempted termination of a contract because of bankruptcy is ineffective. 11 U.S.C. § 365(e) provides that an executory contract or lease of the debtor may not be terminated or modified "at any time after the commencement of a case solely because of a provision in such contract or lease that is conditioned on (A) the insolvency or financial condition of the debtor at any time before the closing of the case; (B) the commencement of a case under this title; or (C) the appointment of or taking possession by a trustee in a case under this title or a custodian before such commencement."
An executory contract or unexpired lease may be assumed. It is a fundamental concept that the assumed contract or lease is accompanied by all its provisions and conditions. Atchison, Topeka & Santa Fe Ry. Co. v. Hurley, 153 F. 503 (8th Cir. 1907) aff'd 213 U.S. 126, 29 S. Ct. 466, 53 L. Ed. 729 (1909). Thus, a contract may be assumed subject to all its limitations, one of which is obviously the expiration date.
In the instant case it is clear that White could not terminate the franchise under the existing contract solely on the basis of the bankruptcy. It is apparent that the relationship had been plagued by problems *117 from its inception and that collectively these problems could have furnished grounds for termination long before the filing of the bankruptcy petition. It is also clear that the unexpired term of the contract (January 10-29) could have been assumed by NWT.
The parties have placed emphasis on whether the decision to terminate was the result of filing the bankruptcy. The exact time White determined to cancel is difficult to determine but the court, for reasons hereinafter stated, does not find it to be critical. Additionally, as shown by the facts, it cannot be logically argued that bankruptcy was the cause of termination. Numerous other factors existed and bankruptcy simply added to the stack. At most it was the event that triggered a final decision.
The assumption or rejection of executory contracts and leases allowed by the Bankruptcy Code is a unique power given to facilitate the rehabilitation of debtors. The Code does not, however, grant the debtor in bankruptcy greater rights and powers under the contract than he had outside of bankruptcy. The court finds nothing in the Code which enlarges the rights of NWT under the contract or which prevents the termination of the contract on it own terms on January 29, 1980.
Having reached that point, however, the court must determine what rights and interests the parties had after the January 29, 1980, expiration date. The court finds no state or federal law which gives the debtor rights to performance by White after the expiration date of the contract. 15 U.S.C. § 1221-1225, the Automobile Dealer Franchise Act, creates a cause of action for wrongful termination of a dealer by a manufacturer. The statute provides for recovery of damages when the manufacturer has used coercion or intimidation in his dealings with the dealer. The statute may not be used, however, to force continued dealings between the parties. Fray Chevrolet Sales, Inc. v. General Motors Corp., 536 F.2d 683 (6th Cir. 1976); Overseas Motors, Inc. v. Import Motors Ltd., Inc., 519 F.2d 119 (6th Cir. 1975), cert. denied 423 U.S. 987, 96 S. Ct. 395, 46 L. Ed. 2d 304 (1975).
T.C.A. § 55-17-114 allows the Tennessee Motor Vehicle Commission to revoke the license of a manufacturer who unfairly terminates or fails to renew the franchise of a motor vehicle dealer. It does not create a private cause of action or prohibit termination. T.C.A. § 47-19-101 requires the repurchase of inventory after termination of a franchise but provides no other remedy.
Having found no state or federal law which creates continuing rights in the Nashville dealership, the court must next determine whether a new contract arose by virtue of the conversations between the parties at any of the various meetings. It appears from the facts that White stated that a termination would not be forthcoming if NWT could correct their more serious problems. Emphasis was placed on the lack of open account for parts and lack of a floor plan arrangement. A number of other problem areas were discussed. As the expiration date of the contract approached, it became apparent that NWT was not going to be able to change those conditions.
Since the conditions outlined by White were not met by NWT by January 29, 1980, White was no longer bound to enter into the new contract. There was no unconditional promise to renew. Any acts taken by NWT can best be characterized as preliminary steps to improve the working capital problem; as such they are preparatory only and do not represent a substantial part of the requested performance by a party to the contract. Corbin on Contracts § 49 (1950); Williston on Contracts §§ 60A, 73 (3rd ed.)
Assuming arguendo that the conversations between NWT officers and White officials resulted in an oral contract to renew the dealership agreement, the court is forced to reach the same result. Such an agreement, although preliminary to the actual renewal, is not separate and distinct from the renewal of the dealer sales and service agreement to be executed later. By *118 the great weight of authority, an oral contract or agreement to enter into a written agreement which is within the scope of the Statute of Frauds is also within the Statute. Union Car Advertising Co., Inc. v. Boston Elevated Ry. Co., 26 F.2d 755 (1st Cir. 1928); Annot. 58 A.L.R. 1015; Patterson v. Davis, 28 Tenn.App. 571, 192 S.W.2d 227 (1945), cert. denied (1946); 72 Am. Jur.2d Statute of Frauds § 4; 37 C.J.S. Statute of Frauds § 64. The rationale behind such a position is obvious.
To allow the enforcement of such an agreement would be tantamount to taking the main contract out of the statute, and as has been said, it is absurd to say that an oral promise in relation to certain subject matter is invalid, but that a promise that the party will thereafter bind himself with respect to the subject matter is valid. Such a construction would be a palpable evasion of the statute and let in all of the evils against which it is directed. 72 Am.Jur.2d, Statute of Frauds § 4 at 568.
Thus, if the renewal contract is within the Statute of Frauds, the agreement to enter into the renewal contract falls within its protection as well. The determining factor seems to be the effect of the termination clause found in the original form contract used by the parties which provided for termination by either party at any time upon the giving of thirty days notice. Again the majority view seems to be that the fact that either of the parties may have the right to terminate a contract within a year does not take it out of the "operation of the statute, if, independent of the exercise of such a power, the agreement cannot be performed within a year." 72 Am.Jur.2d Statute of Frauds § 16 at 580. This position is consistent with that found in 37 C.J.S. Statute of Frauds § 48 and Williston on Contracts § 498A (3rd ed.). To the contrary, however, see Corbin on Contracts § 499 (1950).
While there are several Tennessee cases dealing with performances not to be completed within one year, none have been found in which the right of either party to terminate the contract has played a crucial role. In holding that an oral contract to do grading for a railroad was not within the Statute of Frauds, the Supreme Court of Tennessee stated that the Statute extends only to "contracts in which, by express appointment or understanding of the parties, the thing is not to be performed within a year." Later it added that such understanding "must appear either from the inherent nature of the contract, or from the words or actions of the parties at the time, that such an understanding was a part and parcel of the agreement itself." Johnston v. Cincinnati, N.O. & T.P. Ry. Co., 146 Tenn. 135, 240 S.W. 429, 432 (1922). In a similar case where the parties had entered into a contract to remove gravel and supply it to a road contractor, the court found the agreement to be outside the Statute of Frauds since it could be performed within a year and repeated that the Statute extends only to contracts in which by express understanding of the parties the contract is not to be performed within one year. Anderson-Gregory Co. v. Lea, 51 Tenn.App. 612, 370 S.W.2d 934 (1963).
In applying the Statute of Frauds to an employment contract, the Supreme Court of Tennessee found an oral contract to employ a carpenter for three years to be within the statute notwithstanding the fact that death could have terminated the agreement within one year. Dickens v. Tennessee Electric Power Co., 175 Tenn. 654, 137 S.W.2d 273 (1940). In that instance death acts to defeat the contract, not to complete it.
The Boutwell court applied the reasoning of the Johnston opinion, supra, and added:
The question is not what the probable, expected, or actual performance of the contract may be, but whether, according to the reasonable interpretation of its terms, it requires that it should not be performed within the year. Unless the court, looking at the contract in view of the surroundings, can say that in no reasonable probability can such agreement be performed within the year, it is its duty to uphold the contract. Boutwell v. Lewis Bros. Lumber Co., 27 Tenn.App. 460, 182 S.W.2d 1, 3 (1944).
*119 Performance in the reasonable interpretation of the word contemplates full and complete performance. It is the opinion of the court that exercise of the termination right acts to defeat performance, and thus the contract, not to complete it. Accordingly, the court finds that the right of termination in the contract at issue does not act to take it out of the Statute of Frauds and that to be enforceable it must be evidenced by a written memorandum.
The memorandum required to satisfy the Statute of Frauds "presupposes a prior valid agreement, and meeting of minds, of the parties." 72 Am.Jur. Statute of Frauds § 290. It must show an existing and binding contract as distinguished from mere negotiations and must disclose the particular contract sought to be enforced. Black v. Black, 185 Tenn. 23, 202 S.W.2d 659 (1947). Such writing must contain all the essential terms and conditions of the contract. 2 Corbin on Contracts § 499 (1950). "Unless the writing, considered alone, expresses the essential terms with sufficient certainty to constitute an enforceable contract, it fails to meet the demands of the statute." Williston on Contracts § 575 (3rd ed.).
Letters or other memoranda are not sufficient "unless they amount to an acknowledgement by the party to be charged that he has assented to the contract that is asserted by the other party. If, when interpreted together, they show no more than preliminary negotiation suggesting terms to be later agreed upon, they are insufficient to establish a contract." 2 Corbin on Contracts § 517 (1950). It has also been stated that "a memorandum disclosing merely that a contract had been made, without showing what the contract is, is not sufficient to satisfy the requirement of the Statute of Frauds that there be a memorandum in writing of the contract." Lambert v. Home Federal Savings and Loan Assoc., 481 S.W.2d 770, 773 (Tenn.1972).
Such memoranda may consist of separate writings if one of them is signed by the party to be charged and refers to others that supply the details. 2 Corbin on Contracts § 512 (1950). Telegrams and teletype messages are sufficient to satisfy the Statute. Williston on Contracts § 569 (3rd ed.). Letters, telegrams or other written communication by a party to a contract to his agent or to one who is not a party thereto, which sufficiently disclose the terms of the agreement and admit it or affirm it are valid memoranda to satisfy the Statute. Lee v. Cherry, 85 Tenn. 707, 4 S.W. 835 (1887); Annot. 112 A.L.R. 490.
Several documents may be relied on to satisfy the Statute if they clearly relate to each other and collectively make out the contract with all the terms. Yates v. Skaggs, 187 Tenn. 149, 213 S.W.2d 41 (1948); Schultz v. Anderson, 177 Tenn. 533, 151 S.W.2d 1068 (1941). Such memorandum must contain the essential terms of the contract expressed with such certainty that they may be understood without resort to parol. Johnson v. Haynes, 532 S.W.2d 561 (Tenn.App.1975). A term is essential if it seriously affects rights and obligations of the parties. Ginsberg Mach. Co. Inc. v. J & H Label Processing Corp., 341 F.2d 825 (2d Cir. 1964).
In the instant case the court finds that the telex sent from the Holzworth office to Kenyon did not show an existing and binding contract but merely a routine inquiry preliminary to further discussions with the debtor. Assuming arguendo that such an agreement were found, the telex by its own terms raises the question of the number of years to be considered in the future association. Recognizing the troubled history of the relationship, the court certainly cannot make any assumptions as to what the parties would have decided. It is also to be noted that once the telex was received by the regional officials of White, all action possibly precipitated by the notice was stopped. Kenyon and Flynn promptly called Holzworth and informed him that the Southeast Region recommended non-renewal of the franchise. Holzworth agreed with the recommendation and instructed Flynn to prepare the documents for approval of non-renewal. Accordingly the court must *120 find that the telex and its reference to the dealer sales and service agreement do not evidence prior agreement or contract between the parties, do not supply all the essential terms, and thus do not act as sufficient memoranda to satisfy the Statute of Frauds.
The continued business relationship between the parties since the January 29, 1980, date has resulted from the uncertainty as to the legal status of the franchise under the provisions of the new Bankruptcy Code and not from any waivers on the part of White. 11 U.S.C. § 362 provides that the filing of a petition operates as a stay of any act by an entity to obtain possession of property of the estate or of property from the estate; the stay continues until such property is no longer property of the estate. Since the court has found that the debtor had no interest in the franchise after the January 30, 1980, expiration date, it is clear that the franchise was no longer property of the estate and that the stay provisions of § 362 no longer applied. Accordingly, the court finds that the automatic stay of § 362 terminated in regard to the franchise as of January 30, 1980, when the property ceased to be property of the estate. The lease agreement provided that it could be terminated by either party following thirty days written notice upon termination of the dealer selling agreement. The giving of such notice has been stayed by § 362. Having found no dealership interest remaining in the debtor after January 30, 1980, the court also finds that the lease terminated thirty days afterward on March 1, 1980.
An appropriate order will be entered.
NOTES
[1] REASON:
Nashville White Trucks, Inc., filed a petition in bankruptcy (Chapter XI-Reorganization) on January 10, 1980. The dealer has been on a cash basis for parts purchases since November, 1978 and without a new truck floor plan source since May 1979, as a result of an out-of-trust situation with White Motor Credit Corporation. Due to these financial complications, this dealer purchased only 25 new trucks and $162,000 parts from White in 1979 versus 66 trucks and $198,000 parts in 1978. The added stigma of bankruptcy will certainly make it increasingly difficult for the dealer to perform his selling agreement obligations and our market position is croding rapidly. We have previously received complaints from one of our major customers regarding this dealer's inability to stock an adequate supply of parts and it is in our best interests in this market to replace this dealer at the earliest possible date. Exh. 14. (Request for Prior Approval Cancellation of Dealer Sales and Service Agreement.) | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534841/ | 231 A.2d 475 (1967)
In re TWO MINOR CHILDREN.
Supreme Court of Delaware.
May 31, 1967.
William Prickett, of Prickett, Ward, Burt & Sanders, Wilmington, for defendant below, appellant.
H. Albert Young and Bruce M. Stargatt, of Young, Conaway, Stargatt & Taylor, Wilmington, for plaintiff below, appellee.
WOLCOTT, C. J., and CAREY and HERRMANN, JJ., sitting.
HERRMANN, Justice:
This is an appeal from an order of the Superior Court granting to an adoptive *476 mother rights of visitation as to her adopted children.
I.
In an earlier appeal (173 A.2d 876), this Court preserved the anonymity of the parties for the sake of the children. We do the same here, again referring to the adoptive father as X, the adoptive mother as Y and her second husband as Z. The present third husband of Y will be referred to as H.
By petition for habeas corpus, Y again seeks visitation rights denied to her in the earlier appeal in 1961. The children, a girl and boy, are now aged 13 and 11 respectively.
Under 13 Del.C. § 956, the Superior Court referred the matter to the Family Court for findings and recommendations. After hearing, the Family Court recommended denial of visitation, finding that visitation will not be in the best interest of the children. This was the conclusion of the Family Court notwithstanding a report of an eminent psychiatrist, retained by the Court as an impartial expert with the consent of both parties, favoring visitation as probably not harmful to the children and beneficial as to Y. Y objected to the Family Court's recommendations. On the basis of the Family Court record, supplemented by a private, unrecorded interview with the children, the Superior Court granted visitation rights, specifying one day each month in Delaware until the Fall of 1967 and, thereafter, one weekend each month during which Y could take the children to her home in Connecticut. X appeals.
II.
Reference is made to the opinion in the earlier appeal for the factual background of this case. There, this Court reversed a very limited grant of visitation on the ground that, by her adulterous misconduct, Y had forfeited her rights. However, this Court there stated:
"We think therefore that the affording of even limited rights of visitation to Y at this time is premature and, therefore, an error in law. We do not say that Y by her past conduct has forever forfeited the right to visit with these children. If she continues to lead a stable moral life and demonstrates an emotional maturity which would not jeopardize the children's present well-adjusted situation, she may overcome the forfeiture. * *."
The present proceeding was instituted in January 1966. It appears that during the five year period between our earlier opinion and the hearing in the present proceeding, Y has led a stable and moral life and has demonstrated emotional maturity. She resided in the Wilmington area until 1963 with her prior husband Z. They then moved to California and lived near Y's father, a respected, retired business executive. He saw his daughter and her friends frequently; he testified to their good character and moral conduct. In June 1965, Y obtained a divorce from Z on the basis of his misconduct. In August 1966, she married H, a widower with whom she had been acquainted since the early years of her marriage with X. He is a teacher at a college preparatory school in Connecticut. Y and H now live on the campus; Y has adjusted well in the social and civic life of that community.
The children here involved, happy, normal and well adjusted, have been living with X in the Wilmington area. Y has not seen them, except for a passing meeting once in a store, since she left X in 1959. However, the parents of Y have kept in touch with the children and there has been visitation by them from time to time. The father of Y has established a trust fund for the children covering tuition for private school and the costs of summer camp. X is happily remarried and there are two children of this second marriage.
III.
It is elementary, and agreed by all concerned, that the best interest of the children *477 is the primary consideration in this case. The rights and welfare of the parents are secondary. Nelson v. Murray, Del., 211 A.2d 842 (1965). But, though secondary, the parent of a minor child does have natural rights of visitation which must be recognized. Such rights may not be denied unless it is clear that affording the rights would be contrary to the child's best interests.
After careful review of the record, we cannot say that it is clear that visitation by Y at this time would be harmful to the children. Accordingly, we will not disturb the ultimate conclusion of the Superior Court that Y should no longer be deprived of her right of visitation.
However, we have some doubt that more than minimal visitation will be in the best interest of the children. There has been no contact or personal relationship between Y and the children for almost eight years of their relatively short lives. The children are now secure and well adjusted in a happy and harmonious home that may become disrupted by the increased bitterness and animosity renewed contacts between X and Y will probably create. The conflicts and tensions of divided loyalties may be visited upon the children by the creation of a new relationship with Y after so long a time, especially when they now address X's present wife as Mother. The present normal relationship of the two sets of children in the X household may be impaired by a renewal of a relationship with Y.
Such doubts impel us to the conclusion that the order below should be modified. We are unable to agree with the Superior Court's conclusion that the best interest of the children permits visitation to the extent provided by its order. Visitation should be limited, in our judgment, to one day per month, in the State of Delaware, in such manner as not to interfere with school or vacations or holiday observances with X's family; and, in any other way possible, the order of visitation should safeguard the children against the doubts we have expressed.
IV.
X asked to be relieved of the obligation to pay $250., being 50% of the fee of the psychiatrist employed by the Family Court as impartial expert witness. Since X agreed to the employment of the expert, we find no abuse of discretion in requiring him to share in the fee equally.
* * *
The judgment below is reversed and the cause remanded for the entry of a modified order consistent herewith. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534854/ | 813 S.W.2d 855 (1991)
Clarence L. ZAHNER, Respondent,
v.
CITY OF PERRYVILLE, Missouri, Appellant.
No. 73136.
Supreme Court of Missouri, En Banc.
July 23, 1991.
Rehearing Denied September 10, 1991.
*856 David G. Beeson, Stephen Wilson, Jackson, for appellant.
Tom K. O'Loughlin II, Kathleen A. Wolz, Cape Girardeau, for respondent.
COVINGTON, Judge.
The City of Perryville appeals from a judgment ordering the City to refund assessments against certain properties for improvements, maintenance, or upkeep of existing paved streets abutting the properties, and restraining the City from further assessments without submission of the City's street policy to a vote of the citizens. The judgment is reversed and the cause is remanded.
This case involves construction of section 22(a) of article X of the Missouri Constitution. Sections 16-24 of article X were adopted on November 4, 1980. As pertinent to the questions presented here, section 22(a) provides:
(a) Counties and other political subdivisions are hereby prohibited from levying any tax, license or fees, not authorized by law, charter or self-enforcing provisions of the constitution when this section *857 is adopted or from increasing the current levy of an existing tax, license or fees, above that current levy authorized by law or charter when this section is adopted without the approval of the required majority of the qualified voters of that county or other political subdivision voting thereon.
Clarence L. Zahner, resident and taxpayer of the City of Perryville, filed a petition in the circuit court on June 3, 1988. He alleged that certain portions of the City's street improvement policy offended article X, section 22(a), of the Missouri Constitution, in that the City levied or increased the current levy of a tax, license or fee without approval of a majority of voters of the City.
Each party sought summary judgment upon submission of stipulated facts. The City of Perryville is a fourth class city. Prior to and after adoption of section 22(a), the City has effected street construction, improvement and repair under authority of Chapter 88, RSMo 1986.[1] Until November 6, 1980, the City was without written or standard "street policy." The City employed various methods and percentages of contribution from the general revenue and from abutting property owners. As a general practice, the City assessed against the abutting property the initial cost of paving an unpaved street but maintained streets at city expense. Curb and gutter work was not a regular part of the street work performed by the City.
On November 6, 1980, the City, through its mayor and board of aldermen, adopted its first written street policy. Three revisions followed, the last adopted June 1, 1988. The City adopted the first policy and all the revisions without voter approval.
Between 1985 and 1989 the City undertook numerous construction, maintenance or improvement projects. One involved Pine Street, an existing paved street without curbs, gutters or storm water control, which was improved under the third revised policy. Deeming the improvements necessary, the City assessed against the abutting property 100% of the cost for curbs, gutters and storm water control. See §§ 88.680, .700. Zahner paid under protest a "special tax assessment bill" of $1,629.59 for improvements under this project. Zahner claimed the City increased existing fees and charges for street improvements without approval of the required majority of the qualified voters of the political subdivision and without submitting the matter to the voters of the City of Perryville, in violation of article X, section 22(a), of the Missouri Constitution. Zahner further contended that the City undertook to tax residents under its street policy.
Entering judgment in favor of Zahner,[2] the trial court concluded that the special assessments levied by the City in the form of tax bills for street improvements could be characterized as either a tax or a fee within the meaning of article X, section 22(a). The court also concluded that the assessments made by the City of Perryville under its first written street policy and under its subsequent and revised policies violated the constitutional provision in that they impermissibly increased the percentage of contribution required of the taxpayers of the City above the percentage of contribution required of the taxpayers on November 4, 1980, without the required voter approval. The court ordered the City to refund the $1,629.59 paid by Zahner and to pay his attorney fees, and restrained the City from further assessments under any street policy without approval of the voters.
The dispositive question is whether the assessments at issue are taxes or fees within the meaning of article X, sections 16-24. If the special assessment is a tax or fee, the voters of the political subdivision *858 must give prior approval to the assessment. The City contends that the special assessments are neither taxes nor fees within the meaning of section 22(a). Zahner proffers arguments in support of the assessment's being, in the alternative, a fee or a tax. In so arguing he acknowledges Tax Increment Fin. Comm'n v. Dunn Constr., 781 S.W.2d 70, 77 (Mo. banc 1989), in which this Court found certain payments in lieu of taxes to be special assessments rather than taxes, but asks the Court to reconsider the question of special assessments.
Insofar as it reaches, Zahner's assertion that a special assessment may be a tax or fee is not incorrect. Mere denomination of a charge as a "special assessment" does not per se insulate the charge from application of section 22(a). This Court must determine whether the language of section 22(a) encompasses the assessment at issue. In making that determination, the court must undertake to ascribe to the words the meaning the people understood the words to have when they adopted the provision. Boone County Ct. v. State, 631 S.W.2d 321, 324 (Mo. banc 1982). The meaning conveyed to the voters is presumed to be the ordinary and usual meaning, which is derived from the dictionary. Id.
While the words "special assessment," "fee," and "tax" may sometimes be used interchangeably, the term "special assessment" is generally understood to be related either to a specific property or a specific purpose. Webster's Third New International Dictionary 131 (1965). The special assessment levied in this case comports with the general understanding of a special assessment and does not comport with the definition of either tax or fee as the meanings of those words derive from the dictionary and from previous interpretation by this Court.
The initial inquiry presented is whether the special assessment against abutting properties is a fee. This Court first defined "fee," in the context of article X, sections 16-24, in Roberts v. McNary, 636 S.W.2d 332, 335 (Mo. banc 1982). A fee is "a fixed charge for admission; a charge fixed by law or by an institution for certain privileges or services; a charge fixed by law for services of a public officer." From the commonly understood meaning recognized in Roberts, it is apparent that the assessments at issue are not fees. Zahner nevertheless sets forth a novel assertion that the assessment for curb and gutter installation is a fee charged property owners for the privilege of having their streets maintained by the City. Under the scheme set up by the City, he suggests, maintenance of public streets became contingent upon the street's having curbs and gutters. In support of this proposition, Zahner refers to the street policy provision that the City will overlay an existing street only when there are existing curbs and gutters. As a result, Zahner maintains, payment of the assessment for curbs and gutters "purchased" the "privilege" of street maintenancea "service" which had been provided to the City residents for many years. Zahner's argument disregards, however, other provisions in the policy under which the City provides routine maintenance to streets without curbs and gutters. As a consequence, Zahner's contention in this regard fails. The special assessments made by the City under authority of Chapter 88 are not fees.
It remains to determine whether the special assessment at issue is a tax. This Court has previously considered the definition, both prior to and since the adoption of article X, sections 16-24. See, e.g., Roberts v. McNary, 636 S.W.2d 332; Craig v. City of Macon, 543 S.W.2d 772 (Mo. banc 1976); Leggett v. Missouri State Life Ins. Co., 342 S.W.2d 833 (Mo. banc 1960). Taxes, as well as fees, have been defined not only by what they are but also by what they are not. In Roberts this Court noted the dictionary definition of tax as "`a pecuniary charge imposed by legislative or other public authority upon persons or property for public purposes: a forced contribution of wealth to meet the public needs of a government.'" 636 S.W.2d at 335 (quoting Webster's Third New International Dictionary 2345 (1965)).
*859 In Roberts the Court also cited Craig, which in turn quoted Leggett:
`Taxes are "proportional contributions imposed by the state upon individuals for the support of government and for all public needs" ... Taxes are not payments for a special privilege or a special service rendered ... Fees or charges prescribed by law to be paid by certain individuals to public officers for services rendered in connection with a specific purpose ordinarily are not taxes ... unless the object of the requirement is to raise revenue to be paid into the general fund of the government to defray customary governmental expenditures ... rather than compensation of public officers for particular services rendered....'
Roberts, 636 S.W.2d at 335-36. In Tax Increment Fin. Comm'n v. Dunn Constr., 781 S.W.2d at 77, this Court noted that Roberts is not inconsistent with Leggett, and stated that an exaction demanded by the government for specific purposes and not intended to be paid into the general fund to defray general public needs or governmental expenditures is not a tax.
The special assessment tax bills against abutting properties caused to be charged by the City of Perryville fit none of the established definitions of a tax. The payments made by the residents were for a specific purpose. The board of aldermen, through its street policy, clearly recognized a special benefit to property owners as a result of street improvements. According to ordinance, the amount of each assessment was determined by the cost of the improvement. Property owners were assessed pro rata according to the lineal footage of the improvement abutting their properties. The city clerk issued tax bills, payable to the contractor doing the work. There was no payment into the City's general fund. The procedure employed in this case by the City of Perryville is one of special assessment as that term is commonly understood, and is not one of taxation as that term is commonly understood and has been interpreted by this Court in the context of article X, sections 16-24.
Zahner alleges that the owners paid assessments into the general fund in the sense that the payments allowed the City to expend money from its general fund for purposes other than street improvement. Zahner contends that, since the City paid for some curb and gutter work before the amendment was adopted, assessing the costs to owners now frees money from the general revenue fund that otherwise would have been expended to pay for street improvements. Zahner's contentions in support of his argument that the assessment was, in effect, a payment to the general revenue fund are purely speculative and are not supported by the record. The record reflects only one instance in which the City paid for curb and gutter work prior to adoption of article X, sections 16-24. The record is devoid of evidence that the City would otherwise have used the general revenue to install curbs and gutters.
Zahner argues that there is no showing that any special benefit was conferred on residents of the improved streets. His argument is not well taken. He did not raise the challenge below. Furthermore, a legislative determination that benefits are conferred is conclusive on both the owner and the courts, unless it is made to appear that the legislative action is fraudulent, or arbitrary and wholly unwarranted, and by reason of its arbitrary character, is mere confiscation of particular property. City of Webster Groves v. Taylor, 321 Mo. 955, 13 S.W.2d 646, 647 (1928). In this case the board of aldermen through the street policy recite that the improvements benefit the properties. Zahner does not contend that the legislative determination is arbitrary, and nothing in the record indicates that the character of the determination is arbitrary. Zahner fails to meet his burden.
Zahner argues that the express exclusion, in section 22(b), of taxes related to certain bonds implies that there can be no exclusion of special assessments. His analysis in this regard requires no further explication because it rests upon the mistaken premise that the assessment at issue is a tax.
*860 This Court finds that the special assessments made by the City are neither taxes nor fees within the meaning of article X, section 22(a), of the Missouri Constitution. The judgment of the trial court is reversed and remanded for further orders not inconsistent with this opinion.
ROBERTSON, C.J., BLACKMAR, J., and HIGGINS and SEILER, Senior Judges, concur.
RENDLEN, J., dissents in separate opinion filed.
HOLSTEIN, J., dissents and concurs in dissenting opinion of RENDLEN, J.
RENDLEN, Judge, dissenting.
For the reasons following I respectfully dissent.
The majority downplays essential facts which when fully illumined, cast a favorable light on the action of the trial court requiring affirmance of its judgment.
Article X sections 16-24 (commonly referenced as Hancock), adopted by the people in 1980 as amendments to the Missouri Constitution, have as their central purpose, placing a lid on government taking by tax, license or fees without prior voter approval, and a correlative lid on governmental spending (though for legitimate governmental purposes) within limits prescribed by these amendatory sections. Buchanan v. Kirkpatrick, 615 S.W.2d 6 (Mo. banc 1981). In this case the City of Perryville in bygone years acquired lands for the construction and maintenance of its streets. These are public streets on public lands maintained by the city for the benefit of the public at large, and any person may use the streets, subject only to the usual safety regulations, for public travel. In 1987 and 1988, the city adopted resolutions for the improvement of Pine Street where plaintiff Zahner lives and whose property abuts the street. On November 16, 1988, the City Board authorized construction of curbs and gutters on portions of Pine Street and adopted an ordinance levying special assessment on the abutting property owners. Pursuant thereto, special tax bills were issued against plaintiff's property for payment of construction costs. In these matters, Perryville, a city of the fourth class, followed the financing scheme permitted in Chapter 88, RSMo 1986, entitled "Public Works and Special Assessments Therefor," and particularly Sections 88.700, "Street Improvementdeclaration of necessitytaxpayers' protest (fourth class cities)," Section 88.703, "Street Repairscost, how paid (fourth class cities)," and 88.707, "Certain Street Improvementsprotest, how heard and determined." By these statutes the legislature permitted cities of the fourth class to pay for such improvements in the following manner:
Any of said improvements to be paid for by such city may be paid for by said city out of the general revenue funds if the council so desires, but all such work and improvements shall be paid for with special tax bills unless the proceedings of the city for the same specify that payment will be made out of the general revenue funds of said city.
Section 88.703 (emphasis added). In this case, as noted by the majority, the city chose the "tax bill" method of funding, by which the city clerk issued tax bills, payable to the contractor during the work. These "tax bills" were available for levy upon the land of plaintiff, who paid this "special tax," used to defray this public expense, under protest.
As specified in Section 88.703, RSMo 1986, penalties are provided:
for failure to pay such special tax within a given time, and any such tax bills ... shall constitute a lien upon the property liable therefor until paid. (Emphasis added.)
It cannot be seriously questioned that the legislature recognized and denoted these assessments as a special tax, and further that until paid the tax bills "shall bear interest of eight percent per annum from the date of issue." Section 88.703. The statutes are specifically couched in traditional "tax" language, employing the term "special tax" and providing the accepted means of "liens" upon the land for the tax assessed and penalties for late payment. *861 Payment of the "tax" assessment was understandably "protested" by plaintiff in the usual manner for protecting his rights as a taxpayer.
The legislative scheme of Chapter 88 in 1980 and prior years did not require voter approval for any new tax that might be imposed by the city under Sections 88.700, 88.703 or 88.707, but all this changed in 1980 by Hancock, for in that year the constitutional amendment added the requirement of voter approval for such new taxes, regardless how laudatory the purposes for which this new revenue was to be expended. The majority erroneously concludes that the extracting of money by force of law from a landowner, to be used for a public street, is not a tax, citing Tax Increment Financing Commission of Kansas City v. J.E. Dunn Construction Co., 781 S.W.2d 70 (Mo. banc 1989). There this Court avoided application of Hancock to the Missouri Real Property Tax Increment Allocation Redevelopment Act, Sections 99.800 to 99.865, RSMo 1986, by holding that:
First, it makes no difference to the resolution of this point whether PILOTS are taxes as Dunn contends, or not. The Constitution does not prohibit a city from levying an existing tax without voter approval; instead, it prohibits a city from increasing the current levy of an existing tax without voter approval. It is the tax levy against which the constitution's prohibition is measured, not the tax itself,
Dunn, 781 S.W.2d at 74 (emphasis added), and that the record there disclosed no increase in the tax levy, hence this statement:
Second, Dunn does not argue, nor could it on this record, that the City has increased its tax levy. Indeed, the record shows that the PILOTS at issue are the product of the application of the current levy to increased assessed valuations. The evidence does not show any change in the tax levy.
Id. at 74-75.
Though in the case sub judice this "tax" is described and referenced in the statute as a "special tax" and though as stated in Roberts v. McNary, 636 S.W.2d 332, 335 (Mo. banc 1982), that a tax is "a pecuniary charge imposed by a legislative or other public authority upon persons or property for public purposes: a forced contribution of wealth to meet the public needs of a government," and though in this case it is assessed as a new tax upon realty, for which "tax bills" were issued, and private property was subjected to liens of the tax bills, the majority nevertheless concludes it is not a "tax" within the meaning of Hancock. The majority asserts that because the city fathers believed "a special benefit [accrued] to property owners as a result of street improvements" and that the payments from the landowners were for a "specific purpose and not intended to be paid into the general fund to defray public needs or governmental expenditures," the money paid by plaintiff was somehow "not a tax." In this, I submit, the majority errs; it misses the point of Hancock. The money paid by plaintiff was a new tax never before assessed against his land. It was imposed by the government for improvement on public land. Special assessments are levies used to confer benefit upon the parcels charged for the improvements; in contrast, the improvements here are by the city upon its own property for use by the public. The fact that the city in the exercise of its public power chose to improve its streets at a place where the street happens to abut the land of plaintiff does not somehow magically transform the city tax into something other than a tax and thus slide laterally from Hancock's protective cover, which was adopted by the people to provide such protection. This is quite unlike the purchase money in Dunn by which the municipality acquired private property and resold it to private investors and which (whether or not it was a tax) did not increase the current levies and was thus beyond the reach of Hancock. Here in effect the levy was increased, for a new tax was added to provide improvement to publicly owned and maintained city streets. Further, the fact that the monies were collected by the city through its "bill collector" (the contractor who did the work) cannot be said to transform the monies from "tax *862 payments" into something different or not contemplated by Hancock. The constitutional amendment to Article X can not be so neatly avoided by a public entity which it seems to me is patently included within the clear language and avowed purposes of the amendment. The fact that the city does not directly collect the tax but instead decrees the levy, issues the tax bills and is empowered to impose liens upon the private property of landowners cannot alter the fact that a tax is a tax.
This tax, unlike the "PILOTS" of Dunn, is not for the purchase of private property but is for the direct and sole purpose of improving public streets.
While it is important that Hancock, which requires approval by the qualified voters of the city before a new tax may be imposed, affords real protection for property owners threatened with such tax, the Hancock protection is but an additional fail-safe mechanism against imposition of such new taxes. The original safeguard found in § 88.700 remains. That section provides that a fourth-class city which proposes that such "a special tax ... be levied" must first publish notice of its resolution and may only "cause the improvements to be made" if:
a majority of the owners of the property liable to taxation therefor, residing in the city at the date of the passage of such resolution, shall not, within ten days from the date of the last insertion of the resolution, file with the city clerk their protest against [such improvements].
Thus, property owners enjoy the shelter of both the Constitution and the statutes as to such special taxing ordinances.
I would affirm the judgment of the trial court.
NOTES
[1] Section 88.700, RSMo 1986, permits a majority of affected property owners to file protests to prevent assessment for improvements, but, for sound policy reasons, does not provide for submission of the question to all qualified voters of the political subdivision.
[2] The judgment also purports specifically to adjudicate interests of other named taxpayers who filed protests. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534894/ | 108 N.H. 233 (1967)
FLEURY S. MARGESON
v.
THELMA R. LADD.
No. 5615.
Supreme Court of New Hampshire.
Argued May 3, 1967.
Decided July 18, 1967.
*235 Charles M. Dale (by brief and orally), for the plaintiff.
Arthur J. Reinhart (by brief and orally), for the defendant.
DUNCAN, J.
A fundamental argument advanced by the defendant is that there "was no evidence upon which the Master could support its finding that the wall in question was upon the Plaintiff's land." The argument is based primarily upon the proposition that the deeds under which the parties claim contain no measurements and refer to no monuments other than the sidelines of adjacent streets, so that the division line between the adjoining properties cannot be located with accuracy upon the ground.
The twelve inch brick wall erected against the defendant's eight inch brick wall in 1936 or 1937 presumably was to satisfy an easement of support appurtenant to the defendant's property. See Wadleigh v. Cline, 99 N. H. 202; Bean v. Dow, 84 N. H. 464. There was evidence that because of its height the defendant's brick wall would not stand without such support. In finding that the twelve inch wall was located upon the plaintiff's property, the master had before him in addition to the evidence obtained at the view, the description contained in the deed to the plaintiff, which antedated the deed to the defendant, and bounded the plaintiff's property along the boundary in question as follows: "thence . . . to the center of the original 8-inch brick Easterly wall of the Brick building on said last mentioned land [now owned by the defendant]; thence through the center of said original brick wall to said State Street."
Since the twelve inch wall in question was easterly of the "original 8-inch brick Easterly wall" mentioned in the deed, the finding of the master that the twelve inch wall was on the plaintiff's land was amply warranted. The deed under which the defendant claimed offered no contradiction since it bounded the defendant's property on the easterly side simply "by land now or *236 formerly of Charles M. Dale" (now belonging to the plaintiff). Since the evidence warranted the finding made, the finding is sustained.
The balance of the defendant's argument is devoted to the contention that the decree requiring the defendant to restore the wall is oppressive and inequitable, since the plaintiff suffered no material damage, while the defendant "acted in good faith, believing that the window which was cut through the wall was entirely upon her premises" and she will be put to substantial expense to restore the wall, in order to remedy a "harmless encroachment."
The evidence did not compel a finding that the defendant acted in good faith. There was evidence that she requested permission of the plaintiff which was denied, and that installation of the window was later accomplished in a short time by working from the inside of the defendant's own building, so that the plaintiff had no opportunity to halt the work before completion.
Relying upon Hunter v. Carroll, 64 N. H. 572, the defendant argues that the damage which will be caused to the defendant by reason of "an innocent mistake as to the line . . . will be greatly disproportionate to the injury of which the plaintiff complains."
This court has frequently recognized that injunctive relief in equity does not follow automatically from findings that rights of the moving party have been invaded. See Johnson v. Shaw, 101 N. H. 182, 183-189, and cases cited. There is no reason in the case before us however, to assume that the master and the Trial Court failed to weigh the factors which enter into a determination of whether an injunction should issue. Restatement, Torts, ss. 936-941. The issue of damages was considered by the master and a finding with respect thereto was made. The authorities support the granting of affirmative relief in analogous circumstances. Normille v. Gill, 159 Mass. 427; Bonney v. Greenwood, 96 Me. 335, 347; 2 Thompson on Real Property (1961 Replacement) s. 403; 5 Powell on Real Property, s. 690, p. 345; See also, Beaudoin v. Sinodinos, 313 Mass. 511, 519.
It cannot be said upon the record in the case before us that entry of the injunction was erroneous as a matter of law. Accordingly the order is
Exceptions overruled.
All concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535278/ | 5 B.R. 387 (1980)
In the Matter of Robert and Patricia MANNING, Debtors.
Bankruptcy No. 80-20326.
United States Bankruptcy Court, W.D. New York.
July 31, 1980.
George Reiber, Rochester, N.Y., trustee.
Samuel Klafter, Rochester, N.Y., for debtors.
MEMORANDUM AND DECISION
EDWARD D. HAYES, Bankruptcy Judge.
The debtors have filed a Chapter 13 petition and the plan has been submitted for confirmation. At the confirmation hearing, the Judge raised the question of "good faith".
From the facts presented, it appears that last year the debtors had an income exceeding $45,000. Mr. Manning was employed by Eastman Kodak Company as a manufacturing coordinator and Mrs. Manning was employed as an account executive selling insurance. Recently, Mrs. Manning's connection with her previous employer has been severed and she is now selling insurance on her own. In any event, the petition shows a monthly take home income approximating $2,600 and estimated expenses of approximately $2,500 for the husband, wife and three children.
Under the plan, the debtors propose to pay $80 a month for approximately 4.3 years. They propose to pay secured creditors totaling around $3,300 and priority creditors of approximately $1,700. The secured creditors cover an old vehicle which is valued at about $50, some furniture and a 1977 Oldsmobile Delta auto which the wife drives in her work. The priority claims are *388 approximately $1,600 in taxes. The plan does not propose to pay the unsecured creditors who total about $18,000 plus.
The major expense items on a monthly basis are as follows: tuition for the three children in college is $300; food is $754; house expenses are $681; transportation is $319.31 and clothing $117 per month. Other miscellaneous items bring the cost to in excess of $2,500 or over $500 per person per month.
The house which the debtors occupy is a two-family Boston styled home located at 137-139 Gorsline Street, Rochester, New York. There are two apartments in the house. The upper numbered, 137, consist of six rooms, living room, kitchen, dining room, open den, bath and two bedrooms with closets. The lower numbered, 139, has essentially the same room arrangement and is divided into three bedrooms, bath, kitchen and living room. Both kitchens are described by the appraisers as large with adequate cupboard and storage space. The debtors with their five-member family occupy both apartments.
The expenditures were questioned because they seemed in excess of normal expenditures proposed by the debtors under other Chapter 13's. The debtors explained this by saying one of their sons was ill and required a special diet and in fact the whole family required a special diet. The $300 a month tuition at college increases the expenses of the debtors. The job the wife has increases the expenses also. The debtors claim that they are a hardship case and the Court should confirm the plan.
In a recent decision in which this Court discussed "good faith", this Court said at page 423 discussing factors to consider in deciding "good faith" (In re Evelyn Dolores Bellgraph, 4 B.R. 421, (Bkrtcy.W.D.N.Y.))
These factors are the budget of the debtor, the amount the debtor can feasibly pay, the future income and payment prospects of the debtor, the amount of the outstanding indebtedness, the percentage of repayment and the nature of the debts being discharged . . .
Further on in that opinion the Court said:
. . . Attempts to prevent the abuse of creditors' interest by defining "good faith" are laudable until a case such as this case founders upon the rocks of a too restrictive definition of "good faith". Congress's failure to define "good faith" is a mandate to the bankruptcy judges to review each case on its merits and to confirm only those cases which in view of the factors defined by Judge Mabey, supra, measure up to the Courts' sense of what is equitable in a given case. The approach must and should be a flexible one. There should be no exact percentage payment that will insure confirmation. Each case must be decided on its own merits.
Applying that criteria to the present case, the Court can understand the high grocery costs, high transportation costs, the tuition of the children and the medical and drug expense which is incurred by this family. But the Court cannot understand why if this plan is proposed in "good faith" the debtors cannot rent out at least the upstairs apartment for the duration of the plan. This, because of the location of the house, would bring $200 to $250 a month additional income to the debtors and enable them to reduce their expenditures by the utility costs for this unit. The utilities for the smaller apartment average $110 per month. If the upstairs apartment was rented for $200, this would give the debtors an additional $310 per month to pay to their $18,000 in unsecured creditors. This would enable them even over a three year period to pay the payments proposed by the present plan, plus a substantial payment to the unsecured creditors.
Therefore, the plan proposed is denied confirmation and the debtors are given two weeks to submit a new plan which would take into account this order, if they so desire, and it is so ordered.
This Memorandum and Decision shall constitute Findings of Fact and Conclusions of Law in accordance with Rule 752 of the Rules of Bankruptcy Procedure. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535289/ | 5 B.R. 451 (1980)
In the Matter of Iris Levone BLOOM, Debtor.
Bankruptcy No. B 79-02601.
United States Bankruptcy Court, N.D. Ohio, E.D.
August 12, 1980.
*452 Marvin D. Silver, Cleveland, Ohio, for debtor.
Harvey S. Morrison, Cleveland Ohio, trustee.
MEMORANDUM OF OPINION AND DECISION
WILLIAM J. O'NEILL, Bankruptcy Judge.
The facts in this case are not in dispute and the Court, therefore, finds:
On December 12, 1979 the debtor Iris Levone Bloom petitioned this Court for an order for relief. On March 7, 1980 her attorney, Marvin D. Silver, transmitted a copy of the debtor's 1979 personal income tax return to the trustee, Harvey S. Morrison. The debtor was entitled to a $584.32 refund. On March 27, 1980 the trustee filed a motion claiming the tax refund to be non-exempt and to be turned over to the estate. The debtor opposes trustee's allegation and seeks to exercise the exemption rights provided by Sections 2329.66(A)(4)(a) and (A)(17) of the Ohio Revised Code.
The trustee maintains the Sections in question benefit debtors in bankruptcy only, thereby denying equal protection of the law to non-bankrupt debtors, to the trustee and the bankrupt's creditors. The trustee, therefore, asseverates that the Sections in issue are unconstitutional under the Fourteenth Amendment of the United States Constitution and Article I, Section 2 of the Constitution of the State of Ohio. The trustee further asserts the Sections are in conflict with the Bankruptcy Reform Act of 1978, P.L. 95-598, and Article I, Section 8 of the United States Constitution.
LAW AND COMMENTS
To analyze the trustee's charges, it is imperative to examine the pertinent statutes and the authority and facts from which the Ohio exemption law arises.
Article I, Section 8 of the United States Constitution, states, in part, that Congress shall have the power,
"To establish . . . uniform Laws on the subject of Bankruptcies throughout the United States."
From this authority Congress passed the Bankruptcy Reform Act of 1978, P.L. 95-598. This law was enacted on November 6, 1978 and became effective October 1, 1979. Section 522 of the new Bankruptcy Code, Title 11, sets forth the exemptions available to debtors. Section 522(b)(1) permits the debtor in bankruptcy to exempt from the estate "property that is specified under subsection (d) of this section, unless the State law that is applicable to the debtor . . . specifically does not so authorize; . . ." (emphasis added)
On September 28, 1979 the Ohio Legislature exercised its Section 522(b)(1) rights and "opted out" of the Section 522(d) Federal Exemption statute by revising Section 2329.66, O.R.C., as follows:
"(A) Every person who is domiciled in this state may hold property exempt from execution, garnishment, attachment or sale to satisfy a judgment or order, as follows:
. . . . .
(4)(a) The person's interest, not to exceed four hundred dollars, in cash on hand, money due and payable, money to become due within ninety days, tax refunds, and money on deposit with a bank, building and loan association, credit union, public utility, landlord or other person. This division applies only in bankruptcy proceedings. This exemption may include the portion of personal earnings that is not exempt under division (A)(13) of this section.
. . . . .
(17) The person's interest, not to exceed four hundred dollars, in any property, except that this division applies only in bankruptcy proceedings." (emphasis added)
The trustee attacks the underscored portions of (A)(4)(a) and (A)(17) of Section 2329.66; namely, the exemption benefits to bankrupt debtors to the exclusion of non-bankrupt debtors and the alleged unequal *453 protection to the trustee and creditors of the bankrupt debtor. To corroborate his contention the trustee cites a number of cases in which the classification of persons was unreasonable, arbitrary and capricious. These cases, however, are readily distinguishable from the facts and reasoning which gave rise to the enactment of (A)(4)(a) and (A)(17).
The Ohio exemptions per se are not questioned. Allowing them to bankrupt debtors only is challenged. It is noteworthy, however, that "The ultimate question in any classification problem is whether it has some reasonable basis, not whether some were excluded from such class who might well, have been included." State v. Greater Portsmouth Growth Corp., 7 Ohio St. 2d 34, p. 37, 218 N.E.2d 446, p. 450 (1966).
Unquestionably, the Ohio Legislature treated bankrupt and non-bankrupt debtors differently. The rationale for the distinction is to provide the former with the requisite "fresh start". Being fully aware of the unique problems confronting the bankrupt debtors' quest for financial rehabilitation, the Legislature employed reasonable classification of persons to accomplish this end. The Legislature was cognizant that the commencement of a bankruptcy case creates an estate comprised of all of the debtor's property (Section 541, T. 11 U.S.C.A.). Unlike non-bankrupt debtors, the financially distressed bankrupt is in a substantially different posture. He literally relinquishes his earthly possessions without which he is impecunious and relegated to welfare status to his degradation and to the detriment of the tax payers. The alleviation of this onus is a legitimate State interest which justifies a rational basis for resuscitating the bankrupt and relieving the State of an added burden.
To provide bankrupt debtors the necessary "fresh start" to regain self-respect and resume a productive role in the economy, the Ohio Legislature was compelled to draw the distinction between debtors. "That a statute may discriminate in favor of a certain class does not render it arbitrary if the discrimination is founded upon a reasonable distinction, or difference in state policy." Allied Stores of Ohio, Inc. v. Bowers, Tax Commissioner, 358 U.S. 522, p. 528, 79 S. Ct. 437, p. 441, 3 L. Ed. 2d 480 (1959).
"So long as classifications have a real and substantial basis they can not be said to be violative of the equal protection clause even though the lines drawn therein are very narrow." (cases cited) State v. Greater Portsmouth Growth Corp., supra, 7 Ohio St.2d p. 37, 218 N.E.2d p. 450, also McClellan v. Shapiro, 315 F. Supp. 484 (D.C.Conn. 1970).
The language on p. 864 of Howe v. Brown, 319 F. Supp. 862 (D.C.N.D.Ohio 1970), most effectively articulates the Courts' established position on the issue herein:
"[1] In view of the principle, implicit in the federal concept, that the states have broad powers to legislate in areas of their competence, the Supreme Court of the United States has historically exercised restraint in reviewing state legislation creating reasonable classifications of individuals in order to promote legitimate state interests. Thus, as a General Rule, where, a state legislates within areas of its competence, where its legislation is nondiscriminatory on its face and as applied, and where its legislation does not impinge upon the federal constitutional rights of any citizens, any classification created by the legislation survives scrutiny under the Equal Protection Clause so long as the classification is `rationally related' to promoting a legitimate state interest, and is reasonable. This general standard for reviewing state legislation challenged under the Equal Protection Clause, is known as the `rational relation' test." (emphasis added)
The Court continues by citing the wording of Chief Justice Warren in the 1961 case of McGowan v. Maryland, 366 U.S. 420 at page 425, 81 S. Ct. 1101 at page 1105, 6 L. Ed. 2d 393:
"Although no precise formula has been developed, the Court has held that the Fourteenth Amendment permits the States a wide scope of discretion in enacting *454 laws which affect some groups of citizens differently than others. The constitutional safeguard is offended only if the classification rests on grounds wholly irrelevant to the achievement of the State's objective. State legislatures are presumed to have acted within their constitutional power despite the fact that, in practice, their laws result in some inequality. A statutory discrimination will not be set aside if any state of facts reasonably may be conceived to justify it." (emphasis added)
Sections 2329.66(A)(4)(a) and (A)(17), O.R.C. were enacted pursuant to Section 522(b)(1), T. 11 U.S.C.A. of the Bankruptcy Reform Act of 1978, P.L. 95-598. This authority vested the states with the right to specify the exemptions and to employ the necessary provisions to answer the needs of persons domiciled therein. Though not as liberal as the Code's exemptions, the Ohio law is in conformity with the Federal legislative intent to provide the mandated "fresh start" to debtors in bankruptcy. To promote this legitimate State interest of rehabilitating the financially distressed bankrupt debtors to the benefit of the entire State, the Ohio Legislature created a reasonable classification "rationally related" thereto. If the Ohio exemptions appear unjust, recourse and remedy lie with the Ohio Legislature.
CONCLUSIONS OF LAW
1. Because the classification of persons is reasonable and "rationally related" to promote the State's legitimate interest, Sections 2329.66(A)(4)(a) and (A)(17) of the Ohio Revised Code do not violate the equal protection guarantees of the Fourteenth Amendment of the United States Constitution or Article I, Section 2 of the Ohio Constitution.
2. Sections (A)(4)(a) and (A)(17) do not conflict with Article I, Section 8 of the United States Constitution.
3. Sections (A)(4)(a) and (A)(17) are by authority of, and in conformance with, the Bankruptcy Reform Act of 1978, P.L. 95-598.
ORDER
This cause came before the Court and a Decision rendered determining the exemption Sections 2329.66(A)(4)(a) and (A)(17) of the Ohio Revised Code do not violate, nor are in conflict with, the Fourteenth Amendment and Article I, Section 8 of the United States Constitution, Article I, Section 2 of the Ohio Constitution and the Bankruptcy Reform Act of 1978, P.L. 95-598.
IT IS, THEREFORE, ORDERED that the trustee's motion to obtain the debtor's 1979 income tax refund of $584.32, alleging the unconstitutionality of Sections 2329.66(A)(4)(a) and (A)(17) of the Ohio Revised Code be, and it hereby is, denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535320/ | 212 B.R. 827 (1997)
In re Mark Wesley LEWIS, Debtor.
Bankruptcy No. 97-32918-T.
United States Bankruptcy Court, E.D. Virginia, Richmond Division.
July 25, 1997.
*828 Robert B. Brown, Paris, Blank & Brown, Richmond, VA, for Debtor.
Bruce E. Arkema, Cantor Arkema & Edmonds, Richmond, VA, for Richard L. and Judith C. Worland.
MEMORANDUM OPINION
DOUGLAS O. TICE, Jr., Bankruptcy Judge.
On July 23, 1997, the court held a hearing on the debtor's motion to avoid a lien pursuant to 11 U.S.C. §§ 522(f) and (h). After the parties had stipulated to those facts which the court deemed relevant, the court heard oral argument from counsel and then took the matter under advisement. For the reasons set forth in this memorandum opinion, the court will deny the debtor's motion.
Findings of Undisputed Fact
On August 29, 1996, the Circuit Court for the City of Richmond, Virginia, entered a judgment against the debtor and in favor of Richard L. and Judith C. Worland for $372,621.00. Eight months later, on April 18, 1997, Hanover Bank assigned to the Worlands a promissory note and security agreement which the debtor had executed on August 12, 1994, in consideration for a 1994 Toyota Land Cruiser. The security agreement included a dragnet clause which, in pertinent part, provides that the vehicle "secures this loan (including all extensions, renewals, refinancings and modifications) and any other debt I have with you now or later." The term "I" is defined as "each Borrower who signs this note and each other person or legal entity . . . who agrees to pay this note," while the term "You" is defined as "the Lender and its successors and assigns."
Once this assignment had been effected, the Worlands immediately repossessed the debtor's vehicle. On April 21, 1997, the Worlands notified the debtor that, under the terms of the security agreement, the vehicle secured both the amount due under the promissory note and the judgment debt. The debtor responded on April 25, 1997, by filing his petition under Chapter 7 of the Bankruptcy Code and by claiming a $4,500.00 homestead exemption in the vehicle pursuant to Va.Code § 34-4.
On July 2, 1997, the debtor filed the pending motion to avoid any judicial lien asserted by the Worlands to the extent that his homestead exemption would be impaired. The Worlands, however, countered (1) that they held not a judicial lien but rather a security interest in the vehicle which could not be avoided under 11 U.S.C. § 522(f) and (2) that the debtor's voluntary transfer of the interest precludes him from invoking 11 U.S.C. § 522(h).
Discussion and Conclusions of Law
Section 522(f)
The first question of law presented by the parties is quite simple: whether the scope of the dragnet clause included in the security agreement extends to the debt on which the circuit court entered judgment on August 29, 1996. If so, the Worlands hold a security interest in the vehicle which the debtor cannot avoid under § 522(f); if not, the Worlands at most hold a judicial lien which may be avoided under § 522(f) to the extent that the debtor's homestead exemption is impaired.
Although no one disputes that Virginia law must be applied, the courts of the Commonwealth have neither addressed this particular issue nor expressed a view on the propriety of dragnet clauses in general. The vast majority of states, however, have looked upon dragnet clauses with disfavor and have required that the debts sought to be brought within their reach be specifically referenced or bear some relation to one another. See, e.g., Potomac Coal Co. v. $81,961.13 in the Hands of an Escrow Agent, 451 Pa.Super. *829 289, 679 A.2d 800, 804 (1996), appeal denied, 547 Pa. 743, 690 A.2d 1163 (1997) (finding "the better-reasoned approach [to be] the one applying the relatedness test"); Mead Corp. v. Dixon Paper Co., 907 P.2d 1179, 1182 (Utah App.1995) (ruling that a dragnet clause will not be construed to cover future advances unless they "are of the same kind and quality or relate to the same transaction or series of transactions as the principal obligation secured"); Merchants Nat'l Bank v. Stewart, 608 So. 2d 1120, 1126 (Miss.1992) (holding that "antecedent debts will not be deemed within a dragnet clause unless they are specifically identified in the instrument"); Dixie Ag Supply, Inc. v. Nelson, 500 So. 2d 1036, 1040 (Ala.1986) (observing that dragnet clauses "are disfavored in Alabama law and must be explicit as to other debts where there is an intention to include those debts by reference in a newly executed security agreement"); In re Kazmierczak, 24 F.3d 1020, 1022 (7th Cir.1994) (noting that Wisconsin "is one of the states that in order to prevent the abuse of the dragnet clause requires `relatedness'"); In re Johnson, 105 B.R. 661, 664 (D.Kan.1989) (ruling that, under Kansas law, a dragnet clause will encompass antecedent debts only if "clearly identified"); Western Farm Credit Bank v. Auza (In re Auza), 181 B.R. 63, 69-70 (B.A.P. 9th Cir.1995) (finding Arizona law to employ both a "relationship of the loans" test and a "reliance on the security" test); Fokkena v. First Nat'l Bank of Glidden (In re McLaughlin Farms, Inc.), 120 B.R. 493, 506 (Bankr. N.D.Iowa 1990) (ruling that, under Iowa law, whether a later settlement agreement was secured under the dragnet clause in earlier security agreements was "a matter of intent of the parties at the time the original security agreements were executed," which in turn could be discerned from "the language of the security agreement and also to whether the later settlement agreement [was] related to or [was] within the same class as the original debt"); Lansdowne v. Security Bank of Coos County (In re Smith & West Constr., Inc.), 28 B.R. 682, 683 (Bankr.D.Or.1983) (stating that, "[i]n order for future indebtedness to be secured by a future advance clause in the initial security instrument, Oregon law requires that the subsequent debt `be of the same class as the primary obligation . . . and so related to it that the consent of the debtor to its inclusion may be inferred'"); but see Herkimer County Trust Co. v. Swimelar (In re Prichard), 170 B.R. 41, 44 (Bankr. N.D.N.Y.1994) (observing that New York law prohibited the court from interpreting away the obvious meaning of the words involved or supplying additional meanings to them and ruling, therefore, that a dragnet clause was valid and continued the creditor's security interest even after the original note was satisfied); In re Phillips, 161 B.R. 824, 826 (Bankr.W.D.Mo.1993) (noting that "Missouri, perhaps because of its more commercial orientation and less debtor orientation, has not engaged in such anti-dragnet comments").
Notwithstanding the weight of this case law, the court notes that Virginia's judiciary has adopted a rather strict approach when asked to construe the language used by parties in their agreements. For instance, in Graham v. Commonwealth, 206 Va. 431, 143 S.E.2d 831 (1965), the defendant argued that the phrase "price agreed upon" should have been interpreted by the trial court as "price to be agreed upon." The supreme court held, however, that "[t]he contract could have been written . . . in such a manner as to have the meaning for which defendant now argues, but it was not so written and the words used in the contract as written must be given their plain meaning and other words may not be added to change the meaning of those written." Id. 143 S.E.2d at 834. Similarly, in Seoane v. Drug Emporium, Inc., 249 Va. 469, 457 S.E.2d 93 (1995), the trial court had looked for the "commercially reasonable interpretation" of a lease. Id. 457 S.E.2d at 95. The supreme court reversed, ruling that "if such contractual language is unambiguous, . . . we do not apply rules of construction or interpretation; we simply give the language its plain meaning. Thus, `commercially reasonable' considerations are immaterial in applying these unambiguous provisions." Id. at 96 (citations omitted). See also Blue Cross of Southwestern Va. v. McDevitt & St. Co., 234 Va. 191, 360 S.E.2d 825, 827 (1987) (stating that, although printed form contracts should be construed against the party who supplies them, "[t]he rule applies . . . only when the contract is ambiguous on its face").
*830 Applying these principles to the present dispute, the court concludes that Virginia's judiciary would not require the Worlands' judgment debt to be explicitly referenced in the security agreement, to be in the same class as the automobile loan, or even to be specifically contemplated by the parties when the agreement was executed. Giving the language in the agreement its "plain meaning," the debtor pledged his vehicle as security both for the loan from Hanover and for "any other debt [he and `each other person or legal entity . . . who agrees to pay this note' has] with [Hanover and `its successors and assigns'] now or later." These provisions contain no ambiguity, and the court thus has no latitude to employ public policy to alter their meaning.
Therefore, since the debt on which the circuit court entered judgment on August 29, 1996, must have existed either "now or later"[1] and since the Worlands were Hanover's "assigns," the agreement must be read as providing that the vehicle secures the judgment debt. And since this security interest (whether deemed possessory or non-possessory) is not one which can be avoided under § 522(f), this part of the debtor's motion must be denied.
Section 522(h)
Pursuant to 11 U.S.C. § 522(h), a debtor may avoid the transfer of any interest in property which could be avoided by a trustee under 11 U.S.C. §§ 544, 545, 547, 548, 549, or 724(a). This authority, however, is conditioned on the debtor having not made a voluntary transfer of the interest. 11 U.S.C. § 522(h), (g)(1)(A). The debtor in this matter, however, executed the security agreement of his own volition, and he therefore is precluded from invoking § 522(h) to avoid the Worlands' interest in the vehicle.
Conclusion
For the reasons set forth above, then, the court will enter an order denying the debtor's motion to avoid the security interest held by the Worlands in the 1994 Toyota Land Cruiser.
ORDER
On July 23, 1997, the court held a hearing on the debtor's motion to avoid a lien pursuant to 11 U.S.C. §§ 522(f) and (h). After the parties had stipulated to those facts which the court deemed relevant, the court heard oral argument from counsel and then took the matter under advisement. For the reasons set forth in the memorandum opinion accompanying this order,
IT IS ORDERED that the debtor's motion to avoid a lien is denied.
NOTES
[1] The parties introduced no evidence and stipulated to no facts which established the precise date on which this debt arose. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535318/ | 27 Md. App. 460 (1975)
340 A.2d 717
DARYL RENARD STEVENS
v.
STATE OF MARYLAND.
No. 1076, September Term, 1974.
Court of Special Appeals of Maryland.
Decided July 7, 1975.
*461 The cause was submitted on briefs to ORTH, C.J., and DAVIDSON and LOWE, JJ.
Submitted by Sanford Z. Berman and Pickett, Houlon & Berman for appellant.
Submitted by Francis B. Burch, Attorney General, James G. Klair, Assistant Attorney General, Andrew L. Sonner, State's Attorney for Montgomery County, and Ronald G. Scheraga, Assistant State's Attorney for Montgomery County, for appellee.
LOWE, J., delivered the opinion of the Court.
Because the Court of Appeals has provided for an immediate appeal from a denial of a motion to dismiss based upon double jeopardy, Neal v. State, 272 Md. 323, appellant is properly before us. Although his motion to dismiss, denied in the Circuit Court for Montgomery County, asserted grounds of collateral estoppel and res judicata as well as double jeopardy, none of these questions may be reached without crossing the threshold of the jural effect of probation without verdict.
Appellant was arrested as the result of a warranted search of his Prince George's County abode and the seizure of some 28 items which we will assume for purposes of this appeal were stolen from a household in Montgomery County. Apparently as a result of a plea bargain he was charged in the Prince George's County District Court on June 13, 1974 with receiving stolen goods under $100.00. The judge said to *462 appellant "the Court is convinced of your guilt beyond a reasonable doubt." He then went on to say:
"The Court will accept the recommendation of the State Mr. Stevens, therefore, we will enter a finding of probation before verdict, place you on 12 months unsupervised probation. Any difficulties in the 12 months Mr. Stevens and you're brought back and I find you guilty. Do you understand what I'm saying?"[1]
Meanwhile in Montgomery County, appellant had been indicted on June 5, 1974 for burglary (both common law and statutory), daytime housebreaking, breaking and entering, larceny and receiving stolen goods. It is clear from the indictment that the goods he was charged with purloining or intending to purloin or receive were the same he had been charged with receiving in Prince George's County.[2] Appellant moved in the Circuit Court for Montgomery County to dismiss the indictment. The denial of that motion gave rise to this appeal.
Appellant admits that the probation without verdict he received in Prince George's County is incompatible with a guilty verdict, and the latter must yield to the former. The accused can indeed must be retired ab ovo upon violation of that probation. In Duppins v. State, 17 Md. App. 464, 467 we quoted ourselves for emphasis from Bartlett v. State, 15 Md. App. 234, 241.
"Should the probation thus granted be revoked at a subsequent hearing for that purpose, the case *463 reverts to its status at the time the probation was granted, and determination of guilt, by plea or trial, must follow before any sentence may be imposed."
As construed by these two cases, the effect of probation without verdict is the conditional suspension of both the State's right to prosecute and the various protections afforded an accused prior to trial, e.g., the presumption of innocence. This statutory hybrid provides a second chance for an accused to avoid the stigma of conviction. State v. Jacob, 234 Md. 452, 455.
Bartlett and Duppins, both supra, point out the contradiction of imposing a sentence "without finding a verdict." The Legislature has authorized the imposition of restitution by a court in such cases, C. 795, Acts of 1974, but awaited the 1975 session to meet the problem of what to do with respect to the original offense in the event of violation of the conditions of probation. Perhaps to preclude an errant probationer from simultaneously violating his probation and re-donning the cloak of presumed innocence (not to mention the necessity of the State re-shouldering the heavy burden of proof beyond a reasonable doubt, made heavier by passage of time) the Legislature recently eliminated the de novo trial upon violation of probation. The Legislative remedy so drastically changed the concept of Sec. 641 as to virtually eliminate probation without verdict in the orthodox sense. C. 527, Acts of 1975. We are, however, not concerned with the revised version, being restricted to the effect of Sec. 641 as it appeared prior to either the 1974 or the 1975 amendments.
Our Bartlett and Duppins opinions on the older version provide the necessary guidance. The trial judge correctly read those cases as implying "that there should be a retrial upon revocation" but erroneously extended that to mean that "there would not be a question of jeopardy." Presumably acknowledging that jeopardy attached, he was "not satisfied that it necessarily matured."
His reasoning would have been appropriate to considerations of the evidentiary rules of collateral estoppel *464 and res judicata since these principles are both conditioned upon an issue of ultimate fact having been once determined by a valid and final judgment. Ashe v. Swenson, 397 U.S. 436. However, when faced with the Fifth Amendment constitutional question of double jeopardy applied to the states through the Fourteenth Amendment by Benton v. Maryland, 395 U.S. 784 we are concerned with the question of whether jeopardy attached rather than if it "matured." Cf. Blondes v. State, 273 Md. 435. It makes no difference that the ultimate disposition of the Prince George's County charge of receiving stolen goods was conditional. The warrant was amended, a not guilty plea was entered, a finding of not guilty on a coincident assault charge was accepted in the absence of an evidentiary proffer by the State and a stipulation of facts was submitted to the court relative to the receiving charge. Preliminary the court explained to the accused:
"Judge: Just a moment, just a moment. Sir, we're going to proceed without witnesses being called against you, you of that, what I'm saying?
A Yes sir.
Judge: And you have no right to cross examine or question any witnesses. The State is going to tell the Court what happened, do you understand the way we're proceeding?
A Yes sir.
Q Do you have any objections to the manner in which we're proceeding?
A No I don't.
Judge: Alright, counsel?"
There followed the factual recitation upon which the judge declared that the evidence convinced him of appellant's guilt beyond a reasonable doubt.
In an analagous situation considered by the Supreme Court, a juvenile was transferred from Juvenile Court to a Superior Court after an adjudicatory hearing to determine if he had violated a criminal statute. Concluding that the *465 subsequent trial placed him in jeopardy twice for the same offense the Supreme Court in Breed v. Jones, U.S., 17 Crim. L.R. 3047 held that "Jeopardy attached when respondent was `put to trial before the trier of facts (United States v. Jorn, 400 U.S. 470, 479)' ibid., that is, when the ... Court, as the trier of facts, began to hear evidence. See Serfass v. United States, 420 U.S. at."
The Court went on to describe in detail what constitutes "jeopardy":
"Jeopardy denotes risk. In the constitutional sense, jeopardy describes the risk that is traditionally associated with a criminal prosecution. See Price v. Georgia, 398 U.S. 323, 326, 329 (1970); Serfass v. United States, 420 U.S. 377 (1975). Although the constitutional language, `jeopardy of life or limb,' suggests proceedings in which only the most serious penalties can be imposed, the Clause has long been construed to mean something far broader than its literal language. See Ex parte Lange, 85 U.S. (18 Wall.) 163, 170-173 (1873).
* * *
As we have observed, the risk to which the term jeopardy refers is that traditionally associated with `actions intended to authorize criminal punishment to vindicate public justice.' United States ex rel. Marcus v. Hess, supra, at 548-549. Because of its purpose and potential consequences, and the nature and resources of the State, such a proceeding imposes heavy pressures and burdens psychological, physical, and financial on a person charged. The purpose of the Double Jeopardy Clause is to require that he be subject to the experience only once `for the same offence.' See Green v. United States, 355 U.S. 184, 187 (1957); Price v. Georgia, 398 U.S., at 331; United States v. Jorn, 400 U.S. 470, 479 (1971)."
*466 In light of that discussion, we would be hard pressed to exempt a criminal proceeding which ends in probation without verdict from the strictures of the double jeopardy clause. Clearly it is the nature of the proceeding and not the suspension of verdict which controls.
That jeopardy attached here when the stipulated facts were submitted to the court is evident from a comparison with the facts in Blondes, 273 Md. at 446:
"When the prosecution asks for a ruling on the admissibility of the chief documentary evidence against a defendant, when it begins offering other documentary evidence against the defendant, and when it offers the testimony of a witness as a necessary condition to the admissibility of such evidence, then the court has begun `to hear the evidence.' And under the alternate test of `swearing the first witness,' jeopardy attached when Mr. Miller took the oath."
In Blondes, the commencement of the trial placed the appellant in jeopardy, after which the State elected to enter a nolle prosequi to conclude it. Here the stipulated factual recitation had the same effect and the agreed condition of "probation without finding a verdict" suspended the State's right to prosecute[3] in the absence of a violation of the conditions of probation.
Consequently, appellant's Motion to Dismiss the Indictment should have been granted as to the Seventh and Eighth Counts of the Montgomery County Indictment for receiving the same stolen goods for which he had been once placed in jeopardy in Prince George's County. It follows logically that the Fifth and Sixth Counts charging larceny of *467 the same items should also have been dismissed since one may not be convicted of stealing that which he has been determined to have received. Bell v. State, 220 Md. 75; Heinze v. State, 184 Md. 613, 617.
However, we affirm the denial of the Motion to Dismiss the first through fourth counts charging common law burglary, statutory nighttime housebreaking, statutory daytime housebreaking and breaking and entering. Each of these crimes has elements different from and/or in addition to the crime of receiving stolen goods for which appellant is serving his probationary period.[4] Generally, for double jeopardy to bar subsequent prosecution for other crimes arising from the transaction for which appellant had once been brought to trial, the offenses charged must be the same in law and in fact. United States v. Ewell, 383 U.S. 116; Rouse v. State, 202 Md. 481. The Court of Appeals in Bennett v. State, 229 Md. 208, 214 has termed that principle the Blockburger rule from its origin in Blockburger v. United States, 284 U.S. 299, 304:
"`Each of the offenses created requires proof of a different element. The applicable rule is that where the same act or transaction constitutes a violation of two distinct statutory provisions, the test to be applied to determine whether there are two offenses or only one, is whether each provision requires proof of a fact which the other does not.'"
We carry coals to Newcastle by adding that elements of the crimes charged in counts one through four require proof of facts that receiving stolen goods does not.
Judgments affirmed in part and reversed in part.
Case remanded for compliance with this opinion.
Costs to be divided equally between appellant and appellee.
NOTES
[1] The District Court transcript contains a notarized "Certificate which reads:
"I HEREBY CERTIFY this 17th day of September, 1974 that the foregoing transcript was typed by me as heard from the recordings provided by the District Court. Any errors or omissions are due solely to the inability of the undersigned to clearly hear said recordings."
[2] The Prince George's County Inventory of property seized itemizes the personalty found in appellant's abode. For purposes of appeal we accept their being the same as those described in counts of the Montgomery County indictment. But for a typographical spelling error the victim's identification is the same.
[3] The prosecution was on behalf of the State the sovereign whether or not it was conducted in Prince George's or Montgomery County. Political subdivisions such as counties "never were and never have been considered as sovereign entities. Rather, they have been traditionally regarded as subordinate governmental instrumentalities created by the State to assist in the carrying out of state governmental functions." Reynolds v. Sims, 377 U.S. 533, 575 cited in Waller v. Florida, 397 U.S. 387, 392. Thus we are not faced with responsibility for an offense against dual sovereigns as discussed in Moore v. Illinois, 55 U.S. 13 and Bell v. State, 22 Md. App. 496, 509-510.
[4] We do not decide whether a different result would obtain had appellant previously been acquitted of crimes with common elements arising from the same transaction. Ashe v. Swenson, supra, 397 U.S. 436. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535336/ | 275 Md. 321 (1975)
340 A.2d 255
J.I. HASS CO., INC.
v.
DEPARTMENT OF LICENSING AND REGULATION, DIVISION OF LABOR AND INDUSTRY FOR THE STATE OF MARYLAND
[No. 207, September Term, 1974.]
Court of Appeals of Maryland.
Decided June 26, 1975.
The cause was argued before MURPHY, C.J., and SINGLEY, SMITH, DIGGES, LEVINE, ELDRIDGE and O'DONNELL, JJ.
Martin J. Snider, with whom were George N. Manis and Manis, Wilkinson & Snider on the brief, for appellant.
Henry R. Wolfe, Assistant Attorney General, with whom were Francis B. Burch, Attorney General, and Edward M. Ranier, Assistant Attorney General, on the brief, for appellee.
LEVINE, J., delivered the opinion of the Court. SINGLEY and SMITH, JJ., concur in the result and SINGLEY, J., filed a concurring opinion in which SMITH, J., concurs at page 339 infra.
This appeal stems from a determination by the Maryland Commissioner of Labor and Industry (the Commissioner) that appellant, J.I. Hass Co., Inc. (the employer), had violated two safety standards promulgated pursuant to the *323 Maryland Occupational Safety and Health Law of 1973, Maryland Code (1957, 1969 Repl. Vol., 1974 Cum. Supp.) Art. 89, §§ 28-49B (the Maryland Act). On appeal to the Circuit Court for Queen Anne's County, that determination and the civil penalties of $9,000 and $3,000 imposed therein were affirmed.
In 1973, the employer was engaged in painting the new parallel span of the Chesapeake Bay Bridge (the William Preston Lane Memorial Bridge). On September 6, while being lowered into position to do some sandblasting, two of its employees plummeted into the Bay some 40 feet below when a cable unraveled from a winch and their scaffold collapsed. One of the men swam to safety and was rescued; the body of the other, who died of drowning, was recovered four days later. As a consequence, the employer was cited by appellee, Department of Licensing and Regulation, Division of Labor and Industry, with violations of two safety standards: 29 C.F.R. 1926.451(i)(8) (hereinafter referred to as (i)(8)) "Fail[ure] to have men wearing safety belts secured to a substantial member of the structure ..."; and 29 C.F.R. 1926.451(i)(11) (hereinafter referred to as (i)(11)) "Guardrails 42 inches in height, with a midrail and toe boards not in use on all four sides of scaffolds...." These violations were characterized as "Serious and Repeated" under the Act.[1]
Previously, on July 27, a similar tragedy had occurred which also resulted in the death of one employee. Citations *324 had been issued at that time: One for violating (i)(8) "Fail[ure] to require lifelines to be tied off to independent point above scaffold ..."; and the other for violating (i)(11) "Failure to provide top guardrails on both open end or open side of two point suspension scaffold and no toe boards or midrails at any point on the scaffold...." These violations were designated as "serious" and "willful" within the meaning of the Act, and respective penalties of $5,000 and $2,000 were imposed. The employer paid both and took no steps to challenge the citations administratively or judicially as it has done here.
The facts giving rise to these proceedings are virtually free of dispute. Although there were no eyewitnesses to the actual mishap, the uncontroverted evidence shows that while the employer had provided the required safety belts, which were attached to lifelines properly secured to the bridge superstructure, neither of the two workmen was wearing his safety belt when the scaffold collapsed.[2] It is equally uncontroverted that the scaffold had only a back guardrail with none provided at the front or ends and no midrails or toeboards.
Concerned with the "number and severity of work-related injuries and illnesses which, despite current efforts of employers and government, are resulting in ever-increasing human misery and economic loss,"[3] Congress enacted the Occupational Safety and Health Act of 1970 (the Federal Act), 29 U.S.C. § 651 et seq. Declaring as its purpose "to assure so far as possible every working man and woman in the Nation safe and healthful working conditions and to preserve our human resources," 29 U.S.C. § 651 (b), the Federal Act achieves its objectives through programs of research, education and training, and through the *325 development and administration, by the Secretary of Labor, of uniformly applied occupational safety and health standards. As noted in Brennan v. Occupational Safety & Health Review Com'n, 487 F.2d 438, 439 (8th Cir.1973):
"The Act provides for the development of a `laundry-list' of violations. Companies are subject to periodic compliance inspections which are carried out at random either upon complaints or upon the inspector's own initiative. Advance notice of an inspection is prohibited, and violators of this provision are subject to criminal sanctions. Violations may be either of standards promulgated by the Secretary [of Labor] or of the `general duty' provision, a catch-all provision intended to supplement the standards formulated by the Secretary."
The heart of the Federal Act is the power conferred by § 655 upon the Secretary of Labor to promulgate occupational safety and health standards.[4] That section designates specific and detailed procedures to be followed in the promulgation of standards, including publication in the Federal Register, the right of the public to submit written data or comments, a public hearing if requested, and a right of appeal to the United States Court of Appeals. In the first two years after the Federal Act became effective, however, the Secretary was empowered to adopt, without adhering to the full procedure, any national consensus standard[5] or any established federal standard.[6] The Secretary is also granted *326 the power to provide for emergency temporary standards, and, at the request of an employer, to permit a variance from a standard.
Section 654 (a) of the Federal Act imposes a two-fold obligation upon each employer:
"(1) [to] furnish to each of his employees employment and a place of employment which are free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees;
"(2) [to] comply with the occupational safety and health standards promulgated under this chapter."
When finding a violation of the general duty clause or a specific standard, the Secretary must issue a citation, specifying the violation and fixing a reasonable time for its abatement; and must notify the employer of any proposed penalty. The citation and penalty become final if the employer does not contest them within 15 days.
The civil penalties prescribed by § 666 fall into four categories:
1) A discretionary penalty of not more than $10,000 for an employer who willfully or repeatedly violates any standard;
2) A mandatory penalty of up to $1,000 for a serious violation;
3) A discretionary penalty of up to $1,000 for a violation specifically determined not to be of a serious nature;
4) A discretionary penalty of not more than $1,000 for each day during which a violation continues beyond the time permitted for its correction.
All contested cases are heard by the Occupational Safety and Health Review Commission, an independent adjudicatory agency.
In addition to the duties imposed upon employers, each employee must "comply with occupational safety and health *327 standards and all rules, regulations, and orders ... which are applicable to his own actions and conduct." § 654 (b).
In furtherance of its purposes, the Federal Act contemplates extensive state participation in the occupational safety and health field. The states may assert "jurisdiction under State law over any occupational safety or health issue with respect to which no standard is in effect under [the Federal Act]." § 667 (a). The states are permitted to assume responsibility for development and enforcement of "occupational safety and health standards relating to any occupational safety or health issue with respect to which a Federal standard has been promulgated under section 655 ..."; the statute provides for the submission of plans designed to achieve these ends. Subsection (c) of § 667 calls for approval of such plans if, in the judgment of the Secretary, they meet the conditions specified in the Federal Act. The primary requirement is that the state plan be at least as effective in providing safe and healthful employment and places of employment as the federal plan.
The Maryland Occupational Safety and Health Law, Art. 89, §§ 28-49B, was enacted as Chapter 59 of the Laws of 1973, effective July 1 of that year. It is substantially similar to the Federal Act. It vests in the Commissioner of Labor and Industry "the power and authority to administer and enforce the provisions of this subtitle and [the duty to] prescribe such rules and regulations as he may deem necessary to carry out his responsibilities under this subtitle." Art. 89, § 30. Essentially, it tracks the Federal Act in providing for the promulgation of occupational safety and health standards; and in fixing the duties of the employers and employees, and in establishing citation and enforcement procedures. Additionally, the State Act adopts the same civil penalties that are specified in the Federal Act. With particular reference to the standards, § 31 (c) of the State Act provides that: "... [T]he Board shall recommend or propose occupational safety and health standards which are or will be at least as effective in providing safe and healthful employment and places of employment as any standard *328 promulgated under the federal Occupational Safety and Health Act of 1970...."
Having met the applicable federal requirements, the State Act received the approval of the Secretary of Labor on July 5, 1973. 38 Fed. Reg. 17834. Thereafter, the Commissioner, acting on the recommendation of the Occupational Safety and Health Advisory Board created pursuant to § 31 (a) of the State Act, adopted as standards under the state plan the general industry standards (29 C.F.R. § 1910) and the construction standards (29 C.F.R. § 1926) promulgated by the Secretary of Labor under the Federal Act. Thus, the standards set forth in 29 C.F.R. § 1926, including the two standards which appellant is here charged with violating, are incorporated into the state plan.
Section 38 of Art. 89 provides for judicial review of the Commissioner's decisions and states: "The findings of the Commissioner with respect to questions of fact, as supported by substantial evidence, shall be conclusive. The court shall determine whether the rule, regulation, standard or order is in accordance with law...." Subsection (b) provides: "In any proceeding under this section, rules, regulations and standards of the Commissioner shall be deemed prima facie lawful and reasonable."
It was against this legislative and regulatory background that the citations in this case were issued, and that the hearing was held before an examiner designated by the Commissioner. With respect to (i)(8), the Commissioner, acting on the findings of the examiner, found "sufficient evidence that the men who fell into the bay were not wearing safety belts secured to a substantial member of the structure...." He therefore concluded that there was a violation of the standard. Since the employer had previously been cited for violating (i)(8), the September violation was deemed to be "serious" and "repeated"; thus, the $9,000 penalty was imposed. With regard to (i)(11), this finding was made:
"The evidence from the testimony and the admission of representatives of the `Employer' *329 clearly show there were no guardrails on the front or the end and had no midrail or toe-boards.... It is the opinion of the Hearing Examiner that alleged justifications for not providing the necessary guardrails are not in conformity with the law. Although the `Employer' and his representatives have strong opinions concerning hazards of guardrails especially the front guardrails, they did not avail themselves of the opportunity, under Article 89, Section 34(a), (b), (c), and (d) to request a variance, but chose to ignore the standard. It is the opinion of the Hearing Examiner that the `Employer' has not acted in good faith. Therefore, the Hearing Examiner concludes that there was a violation of Standard 29CFR1926.451(i)(11)."
Since the employer also had violated this standard previously, the violation was found to be "serious" and "repeated." The proposed penalty of $3,500, however, was reduced to $3,000 by the Commissioner.
(1)
The (i)(8) Standard
In respect to the (i)(8) standard, appellee contends that this violation was established merely by the uncontroverted evidence that at the time of the accident, the two employees were not wearing the safety belts. Under this view, the fact that they had been provided and were attached to a lifeline secured to the superstructure did not establish compliance. In short, the requirement of the safety standard that the employee "be protected by an approved safety life belt attached to a lifeline" means that they must be worn, not simply furnished.
The employer, though not disputing the evidence, challenges the construction placed upon the standard by appellee. It contends that the employees were "protected" within the contemplation of (i)(8), but simply refused to wear the safety belts. The employer maintains that it would *330 have been virtually impossible for it to have been aware that the employees being fearful of becoming ensnarled in the lines while lowering the scaffold would unhook their belts moments before the incident. The employer argues with considerable logic that compliance with this standard, as interpreted by the Commissioner, would impose a requirement incapable of being met constant surveillance by at least one monitor for each pair of workmen. Finally, the employer claims that scaffold workers are an unusual breed of men who traditionally resist the use of safety belts. Prior to this occurrence, nevertheless, it had taken the following steps in an effort to obtain compliance with the safety belt standards. It had:
1) Conducted weekly safety classes.
2) Provided each employee with a safety belt attached to independent lines.
3) Empowered the Shop Steward with authority to discharge any employee not wearing a safety belt "tied off," an authorization which was uncommonly broad for this field.
4) Instructed all supervisors to observe the men, and to report any employee not wearing a safety belt properly tied.
5) Fired two employees for refusing to wear their safety belts properly tied.
Thus, the employer maintains that it was not in violation of (i)(8) on September 6, 1973. Additionally, it contends that if there was such a violation, it was not of a "serious and repeated" nature, and that the penalty was improper because the Commissioner did not consider all the statutory criteria applicable to the assessment of penalties.[7]
Since the Maryland Act is patterned on the Federal Act this being our first encounter with either we look to the federal cases for guidance. The major authority in this area *331 is National Rlty. & C. Co., Inc. v. Occupational S. & H.R. Com'n, 489 F.2d 1257 (D.C. Cir.1973). There, National Realty was charged with a violation of the general duty clause, § 654 (a)(1), when an employee was injured while riding, contrary to the instructions of his employer, on the front of a loader. In construing the phrase "free from recognized hazards" in (a)(1) the court said:
"Construing the term in the present context presents a dilemma. On the one hand, the adjective is unqualified and absolute: A workplace cannot be just `reasonably free' of a hazard, or merely as free as the average workplace in the industry. On the other hand, Congress quite clearly did not intend the general duty clause to impose strict liability: The duty was to be an achievable one. Congress' language is consonant with its intent only where the `recognized' hazard in question can be totally eliminated from a workplace. A hazard consisting of conduct by employees, such as equipment riding, cannot, however, be totally eliminated. A demented, suicidal, or willfully reckless employee may on occasion circumvent the best conceived and most vigorously enforced safety regime. This seeming dilemma is, however, soluble within the literal structure of the general duty clause. Congress intended to require elimination only of preventable hazards. It follows, we think, that Congress did not intend unpreventable hazards to be considered `recognized' under the clause. Though a generic form of hazardous conduct, such as equipment riding, may be `recognized,' unpreventable instances of it are not, and thus the possibility of their occurrence at a workplace is not inconsistent with the workplace being `free' of recognized hazards." 489 F.2d at 1265-66 (emphasis in original).
The court then went on to conclude:
"... To establish a violation of the general duty *332 clause, hazardous conduct need not actually have occurred, for a safety program's feasibly curable inadequacies may sometimes be demonstrated before employees have acted dangerously. At the same time, however, actual occurrence of hazardous conduct is not, by itself, sufficient evidence of a violation, even when the conduct has led to injury. The record must additionally indicate that demonstrably feasible measures would have materially reduced the likelihood that such misconduct would have occurred." 489 F.2d at 1267 (emphasis added).
This rationale has been followed by a series of federal appellate cases and by several decisions of the Federal Occupational Safety and Health Review Commission: Brennan v. Occupational Safety & Health Review Com'n, 502 F.2d 946 (3rd Cir.1974) (upholding, as supported by substantial evidence, rejection by the Commission of Secretary's contention that would have required closer supervision); Brennan v. Occupational Safety & Health Review Com'n, 501 F.2d 1196 (7th Cir.1974) (instruction to employee to stay away from unloading truck satisfied employer's burden); Secretary of Labor v. Richmond Block, Inc., OSHRC Docket No. 82, 1973-74 CCH-OSHD, ¶ 17,137 (January 11, 1974); Secretary of Labor v. Canrad Precision Industries, Inc., Hanovia Lamp Division, OSHRC Docket No. 89, 1971-73 CCH-OSHD, ¶ 15,355 (December 13, 1972), aff'd, Brennan v. Occupational Safety & Health Review Com'n, supra, 502 F.2d 946; Secretary of Labor v. Standard Glass Co., Inc., OSHRC Docket No. 259, 1971-73 CCH-OSHD, ¶ 15,146 (June 26, 1972); see REA Express, Inc. v. Brennan, 495 F.2d 822, 826 (2d Cir.1974).
In the Canrad case, the Review Commission said:
"... While close supervision may be required in some cases to avoid accidents, it is unrealistic to expect an experienced and well-qualified laboratory technician to be under constant scrutiny. Such a holding by the Commission, requiring that each *333 employee be constantly watched by a supervisor, would be totally impractical and, in all but the most unusual circumstances, an unnecessary burden."
Similarly, in Standard Glass, the Commission explained:
"An employer cannot in all circumstances be held to the strict standard of being an absolute guarantor or insurer that his employees will observe all the Secretary's standards at all times. An isolated brief violation of a standard by an employee which is unknown to the employer and is contrary to both the employer's instructions and a company work rule which the employer has uniformly enforced does not necessarily constitute a violation of section [654 (a) (2)] of the Act by the employer."
Although many of these cases have dealt with the general duty clause, the same principles apply to a violation of a specific standard. Since the purpose of the State Act is "to assure as far as possible every working man and woman in the State of Maryland safe and healthful working conditions and to preserve our human resources," Art. 89, § 28 (c), and not to impose strict liability on employers, the effort made by the employer to prevent hazards is the focal point, not the happening of the accident.
The common thread running through the cases, therefore, is that the employer cannot be charged with being an insurer, or be held accountable to a standard of strict liability. As we have indicated, acceptance of the argument advanced by appellee would have the effect of imposing such a standard in this case. Here, the employer undertook all reasonable means to compel its employees to wear their properly attached safety belts. The evidence further shows that two of them were fired for failing to observe this procedure. In short, the Commissioner has failed to indicate "that demonstrably feasible measures would have materially reduced the likelihood that such misconduct would have occurred." For these reasons, the determination *334 respecting standard (i)(8) and the $9,000 penalty assessed against appellant must be reversed.
In light of our disposition of these issues, it is unnecessary for us to consider whether the violations were "serious and repeated," or whether, in fixing the penalty, the Commissioner took proper account of the statutory criteria.
(2)
The (i)(11) Standard
With respect to the violation of (i)(11), as we have noted, the absence of the required guardrails on the front and side, as well as the midrails and the toe boards, is admitted by the employer. The defense to this citation is that the general duty imposed by Art. 89, § 32 (a) (1), that each employer shall "furnish to each of his employees employment and a place of employment which are safe and healthful as well as free from recognized hazards that are causing or are likely to cause death or serious physical harm to his employees," fastens upon it the duty to create the safest possible work environment, even if this means violating a specific standard. The employer thus claims as an affirmative defense to the alleged violation of standard (i)(11) that the actual working conditions were safer than those contemplated by the standard.
The employer buttresses its contention that the required guardrails would have increased the hazard by pointing to the testimony which it presented. The chief construction inspector of the general contractor, for example, a longtime veteran of bridge construction, gave this testimony:
"Q. Do you feel that [the front guardrail requirement] is a hazard? A. I feel it could be a hazard because you're going to have to get around it anyway and to do it you're either going to have to go under it or over it and, therefore, you're creating a hazard of your own."
The employer's superintendent on this project, also experienced in bridge construction, testified as follows:
*335 "Q. Could you explain to me why you believe the front rail is more hazardous when you are painting the bridge than when you don't have it? A. That front rail the men would either have to climb over or go under. When they're cranking them scaffolds they bump elbows. It's more of a hazard than serves the purpose of safety."
In response to this contention, appellee maintains that the employer should have sought a variance pursuant to § 34 of Art. 89, which requires an applicant for such relief to demonstrate by a preponderance of the evidence that the employer will provide "places of employment to his employees which are as safe and healthful as those which would prevail if he complied with the ... standard from which the variance is sought." The employer acknowledges that no such variance was sought respecting the guardrail requirement. It parries this thrust, however, with the contention that it was not required to do so if the substantial evidence shows that compliance with the standard would have created a greater hazard than that sought to be avoided. In effect, the argument is that in such circumstances an exception to the standard must be implied.
The Federal Occupational Safety and Health Review Commission has had occasion to consider the question posed by these contentions in Secretary of Labor v. Industrial Steel Erectors, Inc., OSHRC Docket No. 703, 1973-74 CCH-OSHD, ¶ 17,136 (January 10, 1974). In addressing the conflicting obligations which may arise from the tension between the general duty clause and an individual standard particularly where the latter may be more hazardous than the employment practice actually followed the Commission observed:
"... While concededly employers have an obligation to comply with applicable standards, in a given situation, we do not read section [654] so literally as to require a form of compliance that will diminish rather than enhance the safety of the employees.... Employees and employers alike should not be required to comply with a standard so sedulously as *336 to follow a course of conduct that is shown by the weight of the evidence to be less safe than an existing work practice.
"This is not to say that the standards adopted by the Secretary are not substantive rules having the force and effect of law. But in our view an exception to the requirements ... must be implied to permit a condition of greater safety or health to prevail in the workplace than is possible under a standard that has general application."
In considering the argument that Industrial Steel Erectors should have obtained a variance, the Commission noted that this is the appropriate procedure, particularly if the employer desires a declaratory judgment type of pre-enforcement relief. It could be argued that an employer, however, may also proceed at his own risk without a variance, chancing that he can prove his action to be justified in a subsequent enforcement proceeding. Accord, Secretary of Labor v. Cleveland Wrecking Co., OSHRC Docket No. 1359, 1973-74 CCH-OSHD, ¶ 18,231 (July 10, 1974); Secretary of Labor v. J.H. Baxter & Co., OSHRC Docket No. 2043, 1973-74 CCH-OSHD, ¶ 16,315 (July 18, 1973). We need not, however, reach this question.
Here, the Commissioner, having noted the uncontroverted evidence that the guardrails (on three sides), the midrails, and the toe boards were not in place, rejected the argument that compliance with (i)(11) would have created a hazard. He was also of the view that this claim should have been presented by an application for a variance. Although there was testimony from which the Commissioner could have found that front guardrails would have created a hazard, he was not compelled to reach this conclusion. There was also testimony from which he could have determined that the painters merely found front guardrails an inconvenience rather than a hazard.
Confronted with these alternative possibilities, it was not inappropriate for the Commissioner to reason that the employer should have sought relief before the fact, rather than risk that it could prove its course of conduct to be *337 justified in some future enforcement proceeding. This reasoning is reinforced by the fact that the employer had been cited for the identical violation just weeks before when a fatality also resulted and had neither contested the charge nor taken any corrective action. That, under these conditions, the Commissioner took a jaundiced view of the increased hazard claim made by the employer is understandable. In any event, these circumstances coupled with the uncontroverted evidence respecting the guardrails readily furnished the substantial evidence necessary to support the findings of the Commissioner, and the circuit court properly affirmed them.
(3)
The $3,000 Civil Penalty
Apart from the violation of (i) (11) itself, the employer also attacks the $3,000 civil penalty imposed by the Commissioner. It contends that he failed to observe the necessary criteria prescribed by the statute, and that, in any event, there was insufficient evidence to permit him to do so. We do not agree. Section 40 (f) of Art. 89 states:
"The Commissioner shall have the authority to assess all civil penalties set forth in this subtitle giving due consideration to the appropriateness of the penalty with respect to the size of the business of the employer being charged, the gravity of the violation, the good faith of the employer, and the employer's history of previous violations."
We think that there is sufficient evidence to support the imposition of the penalty. Two preliminary observations are in order. First, the violation was found to be both "repeated" and "serious," and there is no contention by the employer that the evidence fails to support this determination, or to come within the statutory definition of those terms. For this purpose, it is sufficient to state that a "serious" violation essentially is one where "there is a substantial probability that death or serious physical harm could result." § 40 (b). Secondly, for a repeated violation, "a civil penalty not to *338 exceed $10,000" may be assessed. § 40 (a). The penalty imposed here, therefore, was well below the maximum limit for such a violation.
With respect to the criteria themselves, although, as argued by the employer, there is no evidence of the gross dollar volume of this contract, no such requirement appears in the statute. The evidence showed a range of between 50 and 60 men working on the bridge for this particular employer. This fact, coupled with the evidence that the employer, whose main office was in New Jersey, had handled construction jobs on the same magnitude as the bay bridge in a number of other states, was sufficient to show the size of its business within the contemplation of the statute.
In respect to the other statutory criteria, little need be said. That a fatality occurred for the second time is testimony to the "gravity of the violation." The Commissioner expressly determined in regard to (i)(11) that the employer had not acted in "good faith" one of the remaining criteria ample support for which may be found in its failure to take any remedial action after the prior tragedy. The final consideration to be met under the penalty provision "history of previous violations" speaks for itself in this case.
Contrary to the argument advanced by the employer, the statutory criteria were properly recognized by the Commissioner, and were supported by substantial evidence. Hence, we will not disturb the penalty imposed by him.
Judgment reversed in part, affirmed in part, as herein set forth; as to that part reversed, remanded to Circuit Court for Queen Anne's County with directions to reverse the decision of the Commissioner of Labor and Industry; costs to be equally divided between the parties.
*339 Singley, J., concurring:
I concur in the result reached by the majority only because the constitutionality of the civil penalty imposed under Maryland Code (1957, 1969 Repl. Vol., 1974 Cum. Supp.), Art. 89, § 40, was not challenged by the appellant. See, Maryland Declaration of Rights, Article 8; Constitution, Article IV, § 1.
Judge Smith has authorized me to say that he joins in this concurrence.
NOTES
[1] In relevant part, (i)(8) provides:
"Each employee shall be protected by an approved safety life belt attached to a lifeline. The lifeline shall be securely attached to substantial members of the structure (not scaffold), or to securely rigged lines, which will safely suspend the employees in case of a fall...."
Standard (i)(11) provides:
"Guardrails, not less than 2 x 4 inches, or the equivalent, approximately 42 inches high, with a midrail, and toe-boards, shall be installed at all open sides and ends on all scaffolds more than 6 feet above the ground or floor. Toe-boards shall be a minimum of four inches in height. Wire mesh shall be installed in accordance with paragraph (a)(6) of this section."
[2] The only evidence tending to show that the required safety equipment was not available during the critical moments of September 6 came in the form of a written statement given by the surviving employee to an occupational safety inspector later that day. On the following day, however, he recanted while being interviewed by an insurance claim supervisor. That the employer did furnish the required equipment was acknowledged by the Commissioner, and is accepted by appellee.
[3] S. Rep. No. 91-1282, 91st Cong., 2d Sess. (1970).
[4] Defined in § 652 (8) as a "standard which requires conditions, or the adoption or use of one or more practices, means, methods, operations, or processes, reasonably necessary or appropriate to provide safe or healthful employment and places of employment."
[5] A standard "which (1), has been adopted and promulgated by a nationally recognized standards-producing organization under procedures whereby it can be determined by the Secretary that persons interested and affected by the scope or provisions of the standard have reached substantial agreement on its adoption, (2) was formulated in a manner which afforded an opportunity for diverse views to be considered and (3) has been designated as such a standard by the Secretary, after consultation with other appropriate Federal agencies." § 652 (9).
[6] A standard "established by any agency of the United States and presently in effect, or contained in any Act of Congress in force on December 29, 1970." § 652 (10).
[7] No attack is made here upon the constitutionality of the penalty provisions, nor upon any other part of the State Act. Consequently, we do not consider that question here. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535175/ | 5 B.R. 242 (1980)
In the Matter of Marvin D. HAHN and Joyce M. Hahn, Debtors.
Bankruptcy No. 80-218-C.
United States Bankruptcy Court, S.D. Iowa.
July 15, 1980.
*243 Robert J. Spayde, Oskaloosa, Iowa, for debtors.
Stephen C. Gerard, II, Sigourney, Iowa, for Keokuk County State Bank.
MEMORANDUM OF DECISION
RICHARD STAGEMAN, Bankruptcy Judge.
At Des Moines, in the Southern District of Iowa, on the 15th day of July, 1980.
Marvin D. Hahn and Joyce M. Hahn filed a voluntary petition in bankruptcy on February 19, 1980. In Schedule B-4, annexed to the debtors' petition, Marvin D. Hahn claimed the following personal property as exempt by virtue of the provisions of Section 627, Code of Iowa (1979).
1977 F-250 Ford 4 × 4 truck
1975 Delta 6 × 20 gooseneck trailer
25,000 watt p.t.o. generator
180 A welder
Acetylene torch
air compressor
bolt assortment
paint sprayer
space heater
bench vise
1 tool box wrench set
special mechanic tools
construction tools
carpenter tools
Allis Chalmer WD45 tractor and loader
11' John Deere disc
4 sec. harrow and cart
Lillston rear cultivator
barge box and wagon
side dump and wagon
New Holland # 68 baler
New Holland # 50 bale thrower
60 gallons oil
5 gallons antifreeze
oil filters
(1) 20 × 24 farrowing house (insulated)
(1) 20 × 24 farrowing house
(1) 3 pen hog house
(3) 2 pen hog house
(1) 10 × 20 hog shelter
(4) 60 bushel hog feeders
(1) pig creep
(3) round pig feeders
(3) round pig waterers
(1) 80 gallon hog waterer
(1) electric fence set (posts and wires)
*244
(1) cattle lick tank
On April 2, 1980, the Keokuk County State Bank filed an objection to the debtor's claimed exemptions. It charges that the debtor cannot have the exemptions ordinarily allowed for a farmer because the debtor was not a farmer on the date his petition was filed. Alternatively, if he is deemed to be a farmer certain of the exemptions claimed are not properly "tools" or "instruments" of a farmer. It further objects that the debtor is claiming more than one "vehicle."
The objections were heard on May 5, 1980. The following persons appeared: Marvin D. Hahn, in person and by his attorney, Robert J. Spayde; the Keokuk County State Bank, by its attorney, Stephen C. Gerard II.
Title 11 U.S.C. § 522(b)(2)(A) states that an individual debtor may exempt from property of the estate any property that is exempt under Federal law (other than the specific statutory federal exemptions set out under 11 U.S.C. § 522(d)), "or state or local law that is applicable on the date of the filing of the petition at the place in which the debtor's domicile has been located for 180 days immediately preceding the date of the filing of the petition, or for a longer portion of such 180 day period than in any other place; . . ."
Iowa's exemption statute, Section 627.6, Code of Iowa (1979), provides:
[i]f a debtor is a resident of this state and the head of a family, he may hold exempt from execution the following property:
17. The proper tools, instruments, or books of the debtor, if a farmer . . .
18. If the debtor is a . . . farmer, . . . a team, consisting of not more than two horses or mules, or two yoke of cattle, and the wagon or other vehicle, with the proper harness or tackle by the use of which he habitually earns his living, . . . [*]
It is indeed age-encrusted and ill-suited for the twentieth century.
Nevertheless, under our system of government, lawmaking is within the legislative province and not within the province of the judiciary. It is also a self evident rule of statutory construction that the intention of the lawmakers must be ascertained and carried out. Where the intention of the legislature is not clear the courts must have regard for the statute's object and spirit, and follow that construction which carries out the purpose for which it was passed. 35 C.J.S. (Exemptions) § 4(a), pp. 13-14.
There are five basic purposes for exemption laws:
1. To provide a debtor enough money to survive.
2. To protect his dignity and his cultural and religious identity.
3. To afford a means of financial rehabilitation.
4. To protect the family unit from impoverishment.
5. To spread the burden of the debtor's support from society to his creditors. See Resnich, Prudent Planning or Fraudulent Transfer? The Use of Nonexempt Assets to Purchase or Improve Exempt Property on the Eve of Bankruptcy, 31 Rutgers L.Rev. 615, p. 621 (1978).
In Iowa the Supreme Court early stated that Iowa's exemption statutes are based on public policy to render each citizen independent and above want, shelter for a man and his family safe from abject poverty and beyond the reach of creditors who could turn them into beggars. See Charles v. Lamberson, 1 Iowa 435 (1855).
In interpreting exemption statutes the courts must not substantially depart from their express language, Wertz v. Hale, 234 N.W. 534 (Iowa 1931), or extend the legislative grant. Iowa Methodist Hospital v. Long, 12 N.W.2d 171 (Iowa 1944).
*245 The Iowa exemption statute uses the terms tools, instruments, and vehicle without limitation, qualification, or definition. It must be that they intended to avoid constantly reoccurring questions difficult of solution as to whether or not a particular item of personal property came within the meaning of those terms. The burden of answering such questions then falls necessarily upon the courts.
The Supreme Court of Iowa, divining the beneficent spirit and high purpose of the exemption statutes has used as a basic guideline, and repeatedly decreed and established, that whatever else they shall be liberally construed in favor of those claiming their benefits. This has been the pronouncement of a long line of decisions from Bevan v. Hayden, 13 Iowa 122 (1862), to Frudden Lumber Co. v. Clifton, 183 N.W.2d 201 (Iowa 1971).
Exemption rights in bankruptcy are determined as of the time of the bankruptcy filing. 11 U.S.C. § 522(b)(2)(A). Mansell v. Carrall, 379 F.2d 682 (10th Cir. 1967).
It is conceded that at the time of bankruptcy, Marvin D. Hahn, was a resident of the state and the head of a family. He gives his occupation (Statement of Affairs Q. 2) as "Farming, trucking, custom bailing and combining, and school bus driver." He habitually had made his living at the occupation of farming, although at the time of filing he was not so engaged. The debtor testified, however, that farming was his life's work and that he had no intention to abandon that occupation. In In re Fly, 110 F. 141 (D.C.Cal.1901), a bankrupt who was engaged in farming was entitled to a farmer's exemption even though he stopped farming shortly before he filed his bankruptcy case and was, in fact, engaged in another pursuit. See Pease v. Price, 69 N.W. 1120 (Iowa 1897).
It is not necessary that the person claiming an exemption wholly earn a livelihood using the items claimed exempt. Equitable Life Assur. Soc. of U.S. v. Goode, 70 N.W. 113 (Iowa 1897).
The objecting creditor further complains that some of the items of property are not "tools" or "instruments" used by a farmer, and that the debtor is entitled to but one "vehicle" among the several claimed as exempt.
A tool is commonly defined as an instrument of manual operation as compared to an appliance moved by machinery. Murphy v. Continental Ins. Co., 157 N.W. 855 (Iowa 1916). For example, a saw and hammer would be considered tools. Supra. Accord, Adams v. New York Bowery Fire Ins. Co., 51 N.W. 1149 (Iowa 1892); Peyton v. Farmers Nat. Bank of Hillsboro, Texas, 261 F. 326 (5th Cir. 1919).
The term "instrument," which is synonymous with implement, is more inclusive than "tool." Baker v. Maxwell, 168 N.W. 160 (Iowa 1918). It is an item reasonably fitted or employed as a means of making labor more effective. Supra. "Instrument" has been held to include a very wide range of implements reasonably fitted to be employed in making their owner's labor in his chosen employment more effective. Supra at 161.
A "vehicle" is that in or on which a person or thing is carried or may be carried. State v. Johnston, 252 Iowa 335, 105 N.W.2d 700 (1960). It is a means of conveyance. Employers' Liability Assur. Corp. v. Youghiogheny & Ohio Coal Co., 214 F.2d 418 (8th Cir. 1954). A wheelbarrow, a covered wagon, a Rolls-Royce, a patient mule, a Man of War, and possibly a Pullman Car or ocean liner is a "vehicle." U.S. v. One Ford Coach, 307 U.S. 219, 59 S. Ct. 861, 83 L. Ed. 1249 (1939).
Nearly all of the personal property claimed exempt by the debtor as a farmer qualifies as farm tools or instruments. The operation of a farm calls for many manual skills that require tools necessary to maintain buildings, mend fences and repair machinery. Tools that might otherwise be classified as those of a mechanic or a carpenter are commonly used by farmers and their use reasonably related to a farming operation. The almost entirely steel, complex, *246 and variegated machines of the modern farmer require the use of welders and a wide variety of mechanic's tools if it is to be properly maintained. It is axiomatic that the maintenance of wooden and metal farm buildings require periodic painting, as well as carpentry tools and construction equipment if they are to be kept in a condition that will make them useful for a farming operation.
In the case Baker v. Maxwell, supra at 160, a sawmiller sought to exempt a portable steam powered saw from execution. He and his family used the saw to cut wood for others. The Supreme Court held it to be a proper tool or instrument. It concluded that the property was not restricted to the narrow definition of tool since the Iowa statute also included the term instrument. It further held that a tool need not be a necessity but only a proper one. The statute fixes no limit upon the value or size of such instruments. Supra at 161. The interesting dicta of the Baker case is,
For [a] farmer it may properly include a gang plow, a harvester, a traction engine, or any or all of the multitude of modern farm machinery which may be useful or proper, and the fact that it costs hundreds or perhaps thousands of dollars, or is operated by steam, gas or electricity, or may require an expert to use it successfully, will not expose it to seizure as nonexempt property so long as it be fit and proper for the farmer's use.
Supra at 161.
The court is of the opinion that the case of Meyer v. Meyer, 23 Iowa 359 (1867), cited in Vandeventer v. Nelson, 163 N.W. 354 (Iowa 1917), is distinguishable from this case. In the Meyer case the court held that a threshing machine was not a proper instrument of frontier farming when used in custom threshing. Nevertheless, a portion of the court felt even then that they did not wish to be bound if a case should arise, "in which a threshing machine was claimed by a farmer who owned and needed it for actual use, and did not keep and own it for the purpose of gain." At pp. 376-377.
The hog raising equipment designated "houses" are really more implements than buildings as the term would ordinarily imply. They are small and portable. A farrowing pen can be easily moved from place to place and is only a temporary shelter for shoats, en ventre sa mere or newborn, and sows. Farrowing houses and portable hog pens are not part of the freehold, and ordinarily not intended to pass or descend with the land. Therefore, they are personalty. They have no other utility than in the raising and care of swine. Nothing could be more characteristic of the occupation of farming than that activity. The hog raising items of property claimed by the debtor as exempt property are exempt to him as a farmer.
The debtor has failed to establish that the 25,000 watt p.t.o. generator has any proper relationship to a normal farming operation, and it is not exempt.
Subsection 17 of § 627.6, Code of Iowa (1979) as quoted above holds exempt from execution the proper tools and instruments of a farmer. The Iowa Supreme Court has held, however, that a truck and an automobile owned by a farmer and used by him for general farm purposes, and including the marketing of farm produce, are not farm "tools or instruments" within the meaning of the exemption statute of Iowa, but are to be classed as vehicles "where the statute contains the further classification of a wagon or other vehicle, . . . [as provided for in § 327.6(18)]." Farmers' Elevator & Live Stock Co. v. Satre, 195 N.W. 1011 (Iowa 1923). In that case it is stated:
In a broad sense, perhaps the wagon, or the truck and the automobile, all three are farm implements. Were it not for the specific classification in the statute of the `proper tools, instruments, or books of the debtor, if a farmer,' and a further classification of `the wagon or other vehicles, etc.,' the position of the appellee would be very convincing. But the statute mentions and classifies separately `the proper tools, instruments,' used in the operation of the farm business and `the wagon or other vehicle.' Undoubtedly *247 the truck and automobile in question come within the latter classification and must therefore be considered strictly as vehicles, and not as farm tools.
It was earlier established in the case of Lames v. Armstrong, 144 N.W. 1 (1913), that an automobile is a vehicle within the Iowa exemption law as it serves the purpose of a wagon or other vehicle. This court questions the Lames decision, because in Wertz v. Hale, supra at 532, the Supreme Court held that a resident of this state and head of a family could not hold exempt from execution an automobile in addition to a team and harness. It equated the automobile with the team in terms of motive power. The Iowa exemption statute allowing a farmer a team and a wagon implies a source of motive power and a carrier. The tractor has replaced the team as a source of motive power, but a wagon or trailer which does not have its own source of power is still a wagon or other vehicle. In other words a tractor is a "motor vehicle" and a trailer is just a "vehicle." Making a farmer choose between his team and the wagon would make no sense as one is useless without the other, just as a tractor would be without a vehicle to pull when the transportation of goods was required.
The Ford truck claimed by the debtor and the gooseneck trailer represent a unit comprised of motive power source and carrier.
The debtor must therefore choose between a tractor-wagon combination or the truck and trailer combination, but he cannot have both.
It is therefore, ORDERED, that the objections to the exemptions claimed by the debtor, Marvin D. Hahn, as a farmer are sustained as to the 25,000 watt p.t.o. generator and his claim of both a truck and tractor and all other vehicles mentioned.
It is further, ORDERED, that the debtor elect within 10 days of the date of the entry of this order which vehicles he wishes set off as exempt to him in accordance with the foregoing memorandum of decision.
It is further, ORDERED, that the objections to the debtor's other claimed exemptions are overruled.
NOTES
[*] This wording has not changed since July 1, 1851, and is very similar to the exemptions of the Revised Statute of Iowa Territory, Chapter 155, § 5 (Blue Book 1843). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1535198/ | 5 B.R. 655 (1980)
In the Matter of Harold Thomas JONES and wife, Fritza Montgomery Jones, Debtors.
Bankruptcy No. B-80-00806C-7.
United States Bankruptcy Court, M.D. North Carolina.
August 15, 1980.
*656 R. Walton McNairy, McNairy, Clifford & Clendenin, Greensboro, N.C., for debtors.
Thomas W. Ross, Smith, Patterson, Follin, Curtis, James & Harkavy, Greensboro, N.C., for SunAmerica Financial Corp.
MEMORANDUM ORDER
JAMES B. WOLFE, Jr., Bankruptcy Judge.
This matter came on for a hearing and was heard before the undersigned U.S. Bankruptcy Judge on June 19, 1980 upon the application of the Debtors to avoid the lien of SunAmerica Financial Corporation on a garden tractor belonging to the Debtors pursuant to Section 522(f) of the Bankruptcy Code. The determinative issue is whether the lien is based upon a purchase money security interest or non-purchase money security interest. Upon consideration of the record herein, the written Application and Response submitted by counsel, the documents admitted into evidence, the testimony of the Branch Manager of SunAmerica Financial Corporation, and the arguments of the parties, the Court holds the lien is based upon a non-purchase money security interest and orders that the lien be avoided.
The Debtors borrowed money from SunAmerica Financial Corporation on August 12, 1974, for the purpose of purchasing a Gibson garden tractor and mower assembly. The proceeds from the loan were contemporaneously and simultaneously paid directly to the retail seller, and the Debtors executed a Promissory Note to SunAmerica Financial Corporation together with a Security Agreement granting a security interest in the tractor and mower assembly. The security agreement secured any future advances by the lender in addition to the purchase price of the tractor and mower assembly. SunAmerica promptly filed a financing statement. The purchase money character of the lien at this point is uncontested by the Debtors.
On four occasions thereafter, the last such occasion being February 27, 1980, the Debtors and the creditor refinanced or "flipped" the account in order to cure a delinquency and bring the account current. Each refinancing resulted in the opening of a new account with the old account being marked "paid by renewal". The refinancing resulted in the execution of new Promissory Notes which contained variations from the old Notes in the amounts financed, interest rates, payment amounts, payment numbers, and the total of payments. Each renewal note retained the identical collateral used to secure the refinanced note and advanced a sum of additional money. The sums advanced plus the amounts used to payoff the prior note never exceeded the sums of the original obligation to SunAmerica Financial Corporation. The lender considered the prior Promissory Note as paid in full and discharged upon the Debtor's execution of the renewal note.
The question before the Court is whether the security agreement created a purchase money security interest which will render the lien unavoidable under § 522(f). The Debtor contends the renewals by the lender destroyed the purchase money character of the note. In response, the lender denies that the character of the note is changed by merely refinancing it to accommodate the Debtor and asserts that a lender should not be penalized for attempting to assist a Debtor by lightening his financial burdens.
The purchase money character of the original lien was destroyed by the advancement of the additional sums and the refinancing of the note. The Uniform Commercial Code defines a security interest as purchase money, "to the extent that it is . . . (b) taken by a person who by making advances or incurring an obligation gives value to enable the Debtor to acquire rights in or the use of collateral if such value is in fact so used". U.C.C. § 9-107. The additional sums advanced by the renewal notes were not used to enable the Debtor to acquire rights in the collateral nor did the refinancing of the original Note enable the Debtor to acquire any additional rights in the collateral.
*657 At least one Court has stated the presence of a future advance clause removes a security interest from the purchase money classification. In re Simpson, 4 U.C.C.Rep. 243 (D.C.W.D.Mich.1966) (Dictum). Cf. In re Norrell, 426 F. Supp. 435 (D.C.Ga.1977), (holding a security agreement containing an add on clause was not purchase money because it, "purported to make collateral secure debt other than its own price, . ."). In Simpson, the Court relied on the purposes for adopting the U.C.C. to find that the future advance clause removed the security agreement from the purchase money class. That Court's discussion is pertinent here, where the lender has commingled purchase money and non-purchase money advances and distinguishing between the two becomes difficult.
One of the purposes of the Code is to "simplify, clarify and modernize the law governing commercial transactions". One of the few exceptions to the requirement that notice by filing be a prerequisite to perfection of a security agreement is the purchase money security interest under certain conditions. If a vendor or a lender desires to take advantage of this non-filing requirement, the burden should be on him to prepare a simple instrument which shall be a pure purchase money security agreement without attempting to burden it with complicated and ambiguous impedimenta. Much of the litigation which filled our Courts under pre-code law was due to the effort of adroit drafters to determine how far they could go in concocting instruments that would give maximum rights to vendors and lenders while still qualifying as conditional sales contracts and thus avoiding the necessity of filing. It is hoped that such antics will not occur under the code.
4 U.C.C.Rep. at 248 (citations omitted). The security agreement in the present case contains a future advance clause which uses the collateral to secure debt other than its purchase price. This future advance clause, in itself, is sufficient to extinguish the purchase money character of the security interest under the foregoing authorities. The fact that the lender in this instance filed a financing statement prior to committing any future advances indicates that he questioned the purchase money character of the transaction.
It is unnecessary for this Court to hold that the future advance clause destroys the purchase money character of the security interest since the refinancing alone extinguishes the purchase money character of the security interest. As previously stated, neither the cash advances nor the renewal note enabled the Debtor to acquire rights in the collateral. The purpose of the renewal note was to payoff the original note, an antecedent debt. The purchase money character of the security interest was extinguished when the proceeds from the first renewal note were used to satisfy the original note.
When a purchase money interest is claimed by a secured party who is not a seller, he must of course have given present consideration. . . . [T]he purchase money party must be one who gives value "by making advances or incurring an obligation": The quoted language excludes from the purchase money category and security interest taken as security for or in satisfaction of a preexisting claim or antecedent debt.
Official Comment 2 of U.C.C. § 9-107. The renewal note which was accepted by the lender in the refinancing of the original note was accepted in satisfaction of an antecedent debt. Therefore, the security interest held under the renewal note is nonpurchase money security interest and is avoidable under 11 U.S.C. § 522(f).
The lender also asserts the collateral is not a household good held for the household use of the Debtor which qualifies under the avoidance provisions of § 522. The collateral in this instance is a small garden tractor and mower attachment. The tractor and mower were used for yard work and were never used for any commercial venture. There is no evidence that the Debtor made the purchase with any intent to use it for other than his household purposes. This Court considers the garden tractor and mower attachment, which is *658 used exclusively to mow the Debtor's yard, no less a necessity than a vacuum cleaner. To consider the garden tractor and mower attachment as something other than household goods in this situation would deny the Debtor the basic necessities for the maintenance of his home and would hinder his fresh start.
The foregoing shall constitute Findings of Fact and Conclusions of Law under Bankruptcy Rule 752. IT IS, THEREFORE, ORDERED, ADJUDGED, AND DECREED that the lien is a non-purchase money security interest in household goods held for household use that is avoidable by the Debtor and that judgment be entered accordingly. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2857745/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-91-116-CR
ROBERT A. RODRIGUEZ,
APPELLANT
vs.
THE STATE OF TEXAS,
APPELLEE
FROM THE DISTRICT COURT OF TRAVIS COUNTY, 331ST JUDICIAL DISTRICT
NO. 100,646, HONORABLE BOB PERKINS, JUDGE
Following a joint trial, a jury found appellant and his co-defendant, Mauro
Martinez, guilty of burglary of a habitation. The court assessed appellant's punishment at
imprisonment for seventeen years.
In two points of error, appellant urges that the district court erred by admitting
evidence of an extraneous offense and that the evidence is legally insufficient to sustain the
conviction. We will affirm.
The Austin residence of James and Diana Gatzmeyer was burglarized on November
1, 1989. A large quantity of personal property was stolen, including cash, video equipment, rifles
and shotguns, jewelry, silver, and clothing. That same night and approximately one mile away,
the James and Wilma Sandberg residence also was burglarized. In addition to personal property
of the type stolen in the Gatzmeyer burglary, the intruder took a safe weighing approximately 260
pounds from the Sandbergs.
On December 4, 1989, a man named Chris Arnette contacted Austin police officer
Don Mayes and told him that property taken in these two burglaries could be found in a San
Antonio apartment. Based on this tip and information gathered during a subsequent investigation,
San Antonio police obtained a warrant to search this apartment, which they executed on December
7. The property seized during this search included between 75 and 150 items identified by the
Gatzmeyers and Sandbergs as having been stolen during the burglaries of their homes. Some of
the stolen items were in pillow cases identified as taken in the two burglaries and apparently used
to carry the stolen goods.
The San Antonio apartment was rented by Mauro Martinez and occupied by
Martinez and appellant. There is evidence that a third man, Richard Guerra, may also have lived
there. Much of the stolen property was found in the bedroom of the apartment, the door of which
was secured by a deadbolt lock. Appellant had the key to this lock.
The indictment in this cause was based on the Gatzmeyer burglary. In one point
of error, appellant contends the evidence is legally insufficient to sustain his conviction for this
offense. In his other point of error, appellant argues that the district court erred by admitting
evidence of the Sandberg burglary "because no proof existed that appellant committed the
extraneous offense." The court admitted the extraneous-offense evidence for the purpose of
showing identity, intent, and common plan, and so instructed the jury. See Tex. R. Crim. Evid.
Ann. 404(b) (Pamph. 1992). (1) Of course, the evidence was relevant only if it was shown that
appellant was the perpetrator. Elkins v. State, 647 S.W.2d 663, 665 n.3 (Tex. Crim. App. 1983).
Because the two points of error are interrelated, we will consider them together.
The Gatzmeyer and Sandberg burglaries occurred on the same night, a short
distance from each other. One month later, a large amount of the property taken from each house
was found in an apartment occupied by appellant. Although appellant was not the only occupant
of the apartment, much of the stolen property was found in a locked bedroom to which only
appellant was shown to have a key. The only evidence that anyone else had access to this room
was Martinez's wallet, which was found in the bedroom closet.
In a prosecution for burglary, guilt may be inferred from evidence of the burglary
together with the defendant's possession of the stolen property. Hardage v. State, 552 S.W.2d
837, 839 (Tex. Crim. App. 1977); England v. State, 727 S.W.2d 810, 811 (Tex. App. 1987, no
pet.). To support such an inference, however, the defendant's possession must be personal,
recent, unexplained, and must involve a distinct and conscious assertion of right to the stolen
property. England, 727 S.W.2d at 811. Appellant argues that none of these criteria is present
in this cause, either as to the property stolen in the primary burglary or as to that taken in the
extraneous offense.
Appellant argues that his possession of the stolen property was not personal because
two other men shared the apartment in which it was found. But most of the stolen property was
found in a locked room to which appellant had the only key shown by this record to exist. This
evidence demonstrates both appellant's personal possession of the stolen property and his distinct
and conscious assertion of a right to the property, and is inconsistent with a claim that Martinez
and Guerra had an equal right and facility of access to the stolen goods. See Id. at 811.
A defendant's possession of stolen property need not be exclusive in order to be
personal. For example, the evidence may demonstrate a joint enterprise or conspiracy between
the accused and others with access to the property. Id. at 812. Given the amount of property
stolen during the two burglaries and the weight of the safe taken from the Sandberg residence, it
is unlikely that one person alone committed the offenses. To the extent that the evidence suggests
that Martinez and Guerra also had possession of the stolen property, it does not, under the
circumstances, negate appellant's culpability for the crimes.
Appellant argues that his possession of the stolen property was not recent because
the search of his apartment took place over a month after the burglaries. Whether the property
was so recently stolen as to support an inference of guilt is a question to be determined by the
circumstances of each case. Hardage, 552 S.W.2d at 840. If appellant had been shown to be in
possession of only a few items of easily transferred property, his argument would have some
merit. But the evidence shows that appellant was in possession of scores of items stolen from the
Gatzmeyers and the Sandbergs. Some of this property was still in the pillow cases in which it
presumably was taken. We find the evidence sufficient to render it reasonably certain that there
was no intermediate change of possession.
Finally, appellant argues that his possession of the stolen property was not
unexplained. In his brief, appellant refers us to defense counsel's cross-examination of a San
Antonio police officer, during which the officer indicated that Martinez told him on the day he
was arrested that the stolen goods were brought to the apartment by Chris Arnette (the informer).
During the State's redirect questioning of this officer, however, he reexamined his offense report
and testified that Martinez told him that appellant brought the stolen property to the apartment.
Thus, Martinez's explanation for how the stolen property came to be in the apartment did not
exculpate appellant.
We find that the circumstantial evidence in this cause, when viewed in the light
most favorable to the conviction, does not support any reasonable hypothesis inconsistent with
appellant's guilt, and that the evidence is sufficient to support the jury's finding of guilt beyond
a reasonable doubt. See Jackson v. Virginia, 443 U.S. 307 (1979); Geesa v. State, 820 S.W.2d
154 (Tex. Crim. App. 1991). We also find that the evidence is sufficient to demonstrate
appellant's guilt of the extraneous burglary and overrule appellant's point of error complaining
of the introduction of the extraneous offense on this basis. (2)
The judgment of conviction is affirmed.
Marilyn Aboussie, Justice
[Before Chief Justice Carroll, Justices Aboussie and B. A. Smith]
Affirmed
Filed: August 12, 1992
[Do Not Publish]
1. Appellant does not challenge the stated bases for the trial court's admission of the
extraneous-offense evidence.
2. In this same point of error, appellant briefly asserts that the probative value of the extraneous
offense was outweighed by the danger of unfair prejudice. Tex. R. Crim. Evid. Ann. 403
(Pamph. 1992). We do not address this contention as it was not preserved by trial objection.
Montgomery v. State, 810 S.W.2d 372, 388-89 (Tex. Crim. App. 1991) (opinion on rehearing). | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/2857764/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-91-315-CR
HEATHER C. COX,
APPELLANT
vs.
THE STATE OF TEXAS,
APPELLEE
FROM THE COUNTY COURT AT LAW NO. 6 OF TRAVIS COUNTY
NO. 345,415, HONORABLE DAVID PURYEAR, JUDGE PRESIDING
Appeal is taken from a conviction for the misdemeanor offense of driving while
intoxicated. See Tex. Rev. Civ. Stat. Ann. art. 6701l-1 (Supp. 1992). Trial was before the court
upon a plea of not guilty. Punishment was assessed at sixty days' confinement and a fine of one
thousand dollars. Confinement and fine were probated for a period of two years.
Appellant asserts two points of error. In her first point of error, appellant contends
that the trial court erred in refusing to suppress the results of a breath test due to the fact that the
warnings required by Tex. Rev. Civ. Stat. Ann. art. 6701l-5 (Supp. 1992) were not given before
requesting that she take the breath test. In her remaining point of error, appellant urges that the
trial court erred in finding that the appellant's consent to take the breath test was not coerced. We
overrule appellant's points of error and affirm the judgment of the trial court.
Austin police officer Joyce Neff was the only witness to testify at the pretrial
hearing on the motion to suppress. The transcript of this hearing was introduced by agreement
of the parties and constitutes the entire testimony at trial. The breath test, admitted by stipulation,
reflects that appellant had an alcohol concentration of 0.216.
Officer Neff observed a vehicle traveling on South First Street with only its parking
lights on around midnight on October 12, 1990. Before Neff was able to turn the patrol car and
stop the vehicle she observed it strike the curb and overcorrected by entering the oncoming lane.
Appellant, the only occupant in the vehicle, possessed all the characteristics consistent with
intoxication. She expressed appreciation for being arrested, stating that she knew she was too
intoxicated to drive and did not want to wreck her car. Appellant told Neff that she was either
on San Antonio Street or in the City of San Antonio when she was stopped.
On the way to the police station Neff asked the appellant "if she'd be willing to take
the breath test . . . that I needed to know because . . . I would have to get an officer down there
to administer the test." Appellant was advised that if she refused to take the breath test, "a video
would be done and she'd be booked into jail for D.W.I." Appellant agreed to take the test. It is
agreed that appellant was given the warning prescribed by Tex. Rev. Civ. Stat. Ann. art. 6701l-5
(Supp. 1992) at the station house before she again consented to take the breath test and the test
was administered.
The issues presented in this cause were addressed in our opinion handed down this
day in Ewerokeh v. State, No. 3-91-425-CR (Tex. App.--Austin, August 12, 1992). Our holding
in Ewerokeh is adverse to appellant's contentions. Appellant's points of error are overruled.
The judgment is affirmed.
Tom G. Davis, Justice
[Before Chief Justice Carroll, Justices Jones and Davis*]
Affirmed
Filed: August 12, 1992
[Do Not Publish]
* Before Tom G. Davis, Judge (retired), Court of Criminal Appeals, sitting by assignment.
See Tex. Gov't Code Ann. § 74.003(b) (1988). | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/1644704/ | 994 So. 2d 154 (2008)
GISCLAIR
v.
LOUISIANA TAX COM'N.
No. 2008 CA 1616.
Court of Appeal of Louisiana, First Circuit.
October 31, 2008.
WHIPPLE, J.
Decision without published opinion. Judgments Reversed and Remanded.
DOWNING, J., concurs and assigns reasons. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534824/ | 5 B.R. 47 (1980)
In the Matter of William D. ANDERSON aka William Duane Anderson dba W.D. Anderson Construction Co. dba the Wiland Co., Debtor.
John R. FUERST et al., Plaintiffs,
v.
William D. ANDERSON aka William Duane Anderson dba W.D. Anderson Construction Co. dba the Wiland Co., Defendant.
Bankruptcy No. 679-01245, Adv. No. 680-0015.
United States Bankruptcy Court, N.D. Ohio.
May 9, 1980.
*48 David M. Hunter, Brouse & McDowell, Akron, Ohio, for debtor.
Robert L. Culbertson, Akron, Ohio, for plaintiffs.
FINDINGS OF FACT OPINION AND CONCLUSIONS OF LAW
JAMES H. WILLIAMS, Bankruptcy Judge.
The debtor filed a voluntary petition for relief under Chapter 7 of Title 11, United States Code on October 2, 1979. Plaintiffs were listed on Schedule A-3, "Creditors Having Unsecured Claims Without Priority," annexed to debtor's petition. The clerk of this court, on October 10, 1979, notified all creditors and other parties in interest that October 30, 1979 was established as the date for the meeting of creditors to be held pursuant to 11 U.S.C. § 341 and further, that January 28, 1980 was the last date for filing objections to discharge and for filing complaints to determine dischargeability. Also on October 10, 1979, the clerk served notice on all creditors and other parties in interest that a discharge hearing, pursuant to 11 U.S.C. § 524(d), would be held on January 31, 1980.
The discharge hearing was duly convened on January 31, 1980, a discharge was entered and all parties in interest, as required under the Bankruptcy Code and Rules of Bankruptcy Procedure, were notified of such entry. The court is now presented with a "Motion for Reinstatement of Complainant's Amended Complaint pursuant to Federal Rules of Civil Procedure 60(a) and (b)" upon which a hearing was held and arguments of counsel heard. In addition, counsel for the defendant has submitted a brief in opposition to the motion.
FINDINGS OF FACT
1. The plaintiffs filed a "Complaint Objection to Discharge" on January 24, 1980. The pleading was not accompanied with the requisite filing fee and failed to comply with Bankruptcy Rule 703 and 710, Official Form No. 25 and Official Interim Form No. 24. A copy of the pleading was sent to counsel for the debtor and the trustee in bankruptcy, but no summons and notice of trial or pre-trial conference was issued.
2. The debtor filed a motion on February 1, 1980, seeking the dismissal of plaintiffs' objection. An order granting the motion and dismissing the objection, with prejudice, was entered on February 12, 1980.
3. On the same date, February 12, 1980, plaintiffs filed an amended complaint with the proper caption and the requisite filing fee. This amended complaint demanded that the discharge of the debtor from his debts be denied and that a judgment be granted for damages incurred. No summons and notice of trial or pre-trial conference was issued for the reason that the complaint had been dismissed prior to the receipt of said amended complaint.
4. The within motion was filed by plaintiffs on March 14, 1980.
OPINION
This court, as all Bankruptcy Courts, has recently been confronted with a variety of problems created by the first major revision in the bankruptcy laws of the United States in over forty years, the so-called Bankruptcy Reform Act of 1978 (commonly referred to as the Code) which became effective on October 1, 1979. Indeed, the subject case was filed the very next day, on October 2, *49 1979. Much remains to be done to clarify procedural problems and, in many cases, clear and definitive answers will have to await the promulgation of new rules to be followed by the court and practitioners before it.
However, the new Bankruptcy Code itself does not appear to be the source of confusion which led to the problem which we must now attempt to unravel. Rather, the difficulty here seems to be in interpreting and applying the Rules of Bankruptcy Procedure which have been in existence since 1973!
The Congress, in enacting the Bankruptcy Code, chose not to draft rules but instead this task is left to an Advisory Committee which has, thus far, put forth only Interim Bankruptcy Rules. These Interim Bankruptcy Rules have been adopted for use in the Northern District of Ohio and accordingly, this court is bound thereby. Additionally, the court is bound to follow presently existing Rules of Bankruptcy Procedure, pursuant to § 405(d) as contained in Title IV of the Bankruptcy Reform Act of 1978, Pub.L. 95-598:
(d) The rules prescribed under section 2075 of title 28 of the United States Code and in effect on September 30, 1979, shall apply to cases under title 11, to the extent not inconsistent with the amendments made by this Act, or with this Act, until such rules are repealed or superseded by rules prescribed and effective under such section, as amended by section 248 of this Act.
Following these guidelines, we find, from Rule 701 of the Rules of Bankruptcy Procedure, that the Part VII Rules "govern any proceeding instituted by a party before a bankruptcy judge to * * * (4) object to or revoke a discharge * * *. Such a proceeding shall be known as an adversary proceeding." Continuing, Rule 703 provides that "An adversary proceeding is commenced by filing a complaint with the court." Rule 704 next spells out the duties of the bankruptcy judge upon the commencement of an adversary proceeding.
As found above, the document initially filed by plaintiffs on January 24, 1980, bore little resemblance to the form of complaint contemplated by the Rules. It denominated no parties as plaintiffs or defendants, gave no addresses and was accompanied by neither instructions to the clerk nor the requisite filing fee.
Defendant's motion to dismiss the complaint for want of proper service accompanied by a brief and affidavits by both defendant and his counsel that no service of process had been perfected upon either of them, went unanswered for more than ten days, contrary to Local Civil Rule 3(a)3 of the Rules of the United States District Court, applicable in bankruptcy cases in this District. (see L.Civ. R. 1(a)) The court therefore had no choice but to grant the motion to dismiss and did so by order entered February 12, 1980.
Now the court is requested to reconsider the discharge because, say plaintiffs, "the Court should be more interested in ascertaining whether or not the bankrupt has committed fraud upon the complainants and that the determination of that question is more important so far as the Court is concerned than in determining whether or not the complainants complied with certain rules with reference to the filing of the claim."
Plaintiffs' position is, then, quite simply that what they consider mere form should not prevail over substance, i.e. their asserted fraud claims against the defendant. To find that the court has some basis for unwinding the discharge proceedings herein is, it seems, to hold that finality of action in this area is to be sacrificed if it be demonstrated that counsel's unfamiliarity with practice and procedure before the Bankruptcy Court is the root of the problem.
The court is of the opinion that its order of dismissal of plaintiffs' objection to discharge was not only proper, but required. Plaintiffs had in excess of ninety days within which to commence their action and commence it properly. The discharge hearing went forward, the formalities thereof were observed and an order of discharge was *50 prepared and entered with no properly commenced attack on that process.
The Bankruptcy Court, as a court of equity, is required to act with fairness not only to creditors but to debtors as well. The comments of one court are appropriate:
Thus, while considerable latitude for finding the propriety of filing challenges to discharges is vested in the Bankruptcy Court, such actions must be undertaken in compliance with the provisions of the Bankruptcy Act and Rules, which are designed to protect the interests of both the bankrupt and his creditors. The balance between the entitlement of the bankrupt to his discharge and the interest of creditors in avoiding such a discharge when possible fraud or other grounds exist changes as the proceedings in bankruptcy moves through its various stages. The pre-requisites for asserting a challenge to the bankrupt's discharge change accordingly and must be complied with. In re Capshaw, 423 F. Supp. 1388, 1390-91 (D.C. 1977). (emphasis added)
The court can hardly be faulted for expecting compliance with the clear language of the Rules of Bankruptcy Procedure, nor can it be blamed for granting a motion to which there is no response as mandated by the local rules which it is required to follow.
Plaintiffs have cited no authority to buttress their contention that Rule 60(a) and (b) provides them relief under the circumstances here present. In re Capshaw, 423 F. Supp. 1388 (1977) held, at p. 1390, that "Following the expiration originally established under Rule 404(a) (here the maximum that the court could have allowed for the filing of plaintiffs' action), enlargement of time is governed by Rule 906(b)(2)." The last mentioned rule provides that the court may enlarge time "where the failure to act was the result of excusable neglect * * *". The court is not convinced that a misunderstanding by counsel of the requirements of the Bankruptcy Rules is such "excusable neglect" as is contemplated by Rule 906(b)(2). Turning to 13 Collier on Bankruptcy, 14th Ed., Para. 906.04[2], we read:
The party requesting the extension has the burden of showing a reasonable basis for the failure to comply within the time originally specified.
Excusable neglect is not defined in the rule and at least one court has taken the restrictive view that ordinary negligence, however understandable and excusable in another setting, does not amount to excusable neglect under the instant rule. The more liberal view has allowed extension where, based on a reasonable misunderstanding between the client and its attorneys, or where a reasonable misunderstanding of dates in a notice is coupled with an attorney's absence during the period when the original time allowed was elapsing. The courts have been more generous in granting extensions of time where there is no prejudice or surprise to the bankrupt. * * * The time for filing a creditor's complaint to determine dischargeability will not, however, be extended where the only reason for not filing earlier was a failure to discover the law relating to the filing of such petitions until after the time therefor had expired. (emphasis added) (citations omitted)
CONCLUSIONS OF LAW
1. An objection to discharge is an adversary proceeding pursuant to Bankruptcy Rule 701 and is instituted by the filing of a complaint, pursuant to Bankruptcy Rule 703. Failure to so commence such an action is grounds for dismissal of any pleading which is deficient under the Rules.
2. A request for extension of time is governed by Rule 906(b)(2). The moving party must demonstrate excusable neglect for failure to act within the allotted time and this must consist of more than the mere misunderstanding of counsel of the plain language of the Rules of Bankruptcy Procedure. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534834/ | 1 Md. App. 469 (1967)
231 A.2d 78
JEROME DYSON
v.
WARDEN, MARYLAND PENITENTIARY.
No. 114, Initial Term, 1967.
Court of Special Appeals of Maryland.
Decided June 30, 1967.
Before ANDERSON, MORTON, ORTH, and THOMPSON, JJ.
PER CURIAM:
The applicant for leave to appeal was convicted on July 6, 1960 under two indictments for robbery with a deadly weapon and under one indictment for attempted robbery with a deadly weapon. He was sentenced on December 13, 1960 to a total of thirty (30) years in the Maryland Penitentiary. On direct appeal the convictions were affirmed by the Court of Appeals, 226 Md. 18 (1961) and certiorari was denied by the Supreme Court on January 8, 1962, (368 U.S. 968). The applicant's petition for habeas corpus to the United States District Court for the District of Maryland was dismissed as premature on February 21, 1962. On June 26, 1962 applicant made his first petition under the Uniform Post Conviction Procedure Act. That petition was denied by order of Judge Meyer M. Cardin sitting in the Criminal Court of Baltimore on March 18, 1963. His application for leave to appeal from that order denying relief was denied by the Court of Appeals. Dyson v. Warden, 233 Md. 630 (1964).
*472 This application for leave to appeal was filed October 10, 1966 from an order denying relief of October 4, 1966 of Judge Albert L. Sklar sitting in the Criminal Court of Baltimore on the applicant's second petition for post conviction relief filed July 27, 1966. Relief was denied without appointment of counsel or hearing. The applicant made the following allegations of error in his petition and his amended petitions:
1. That the crimes charged in two of the indictments should have been merged into one offense, and that therefore, petitioner is a victim of "Double Jeopardy."
2. That his constitutional rights were violated because the consolidation of two (2) distinct cases created a prejudicial atmosphere, which influenced a witness in the second case to change her testimony to the detriment of applicant.
This application for leave to appeal fails to contain a statement of the reasons why the order should be reversed and could therefore be denied under Maryland Rules, BK 46b. Goetzke v. Warden, 1 Md. App. 3 (1967). However, we hold that the allegations of error have been waived within the meaning of Maryland Code (1967 Replacement Volume), Art. 27, § 645A (c), as they were not raised on direct appeal or in the first petition for post conviction relief. In Bagley v. Warden, 1 Md. App. 154 (1967) we found it to be implicit in the statute that a petitioner set forth in his petition for relief special circumstances to excuse the failure to raise the allegations or such facts so as to make an adequate showing to rebut the presumption that he intelligently and knowingly failed to make the allegations. Applicant did not set forth such circumstances or such facts in this second petition and is precluded from doing so for the first time at a hearing on that petition. Therefore, there was no error in the denial of relief without appointment of counsel or hearing under Maryland Rules, BK 48. There is no manifest repugnancy between Rule BK 48 and section 645A under the circumstances such as are here present. cf. Baldwin v. Warden, 243 Md. 326 (1966).
In any event, applicant's contentions are without merit. In this State "the true test of whether one criminal offense has *473 merged into another is held to be not whether the two criminal acts are successive steps of the same transaction, but whether one crime necessarily involves the other." Chittum v. State, 1 Md. App. 205 (1967); Veney v. State, 227 Md. 608, 613 (1961). Such merger may occur when a lesser offense is a necessary ingredient of another. Green v. State, 243 Md. 75 (1966). Applicant's contention is that the attempted robbery with a deadly weapon of one person is merged with the robbery with a deadly weapon of another person. These are separate and distinct crimes and obviously neither offense is a necessary ingredient of the other. In contending that there should have been a merger, applicant asserts that any money the person he attempted to rob would have turned over belonged to the person he robbed, and that therefore there was but one crime. However, the elements of the common law crime of robbery do not require that the victim be the owner of the property, only that he have possession or custody. See Clark and Marshall Law of Crimes, 6th Ed. § 12.11. Nor does the fact that the attempted robbery and the robbery took place at approximately the same time and in the same place prevent them from being two separate crimes. On direct appeal, Dyson v. State, supra, the Court found that it can be clearly inferred that the intent and purpose of the applicant was to rob everyone on the premises individually as part of his common scheme. Therefore the attempted robbery cannot be said to have merged with the robbery and the applicant was not twice in jeopardy for the same offense.
The granting of separate trials by a trial judge is discretionary under Maryland Rules, 735 and there is no absolute right to separate trials on separate indictments. Brown v. State, 230 Md. 467 (1963). The record before us does not disclose an abuse of that discretion. We feel that the contention that a witness changed her testimony to the detriment of the applicant was fully answered on direct appeal. Dyson v. State, supra.
Application denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534868/ | 426 Pa. 24 (1967)
Commonwealth
v.
Corbin, Appellant.
Supreme Court of Pennsylvania.
Argued May 25, 1967.
June 29, 1967.
*25 Before BELL, C.J., MUSMANNO, EAGEN, O'BRIEN and ROBERTS, JJ.
James H. Rowland, Jr., with him John J. Shumaker, for appellant.
Henry W. Rhoads, Assistant District Attorney, with him LeRoy S. Zimmerman, District Attorney, for Commonwealth, appellee.
*26 OPINION BY MR. JUSTICE MUSMANNO, June 29, 1967:
After pleading not guilty to a charge of murder, Henry Corbin was tried by a jury which, on February 1, 1966, found him guilty of murder in the second degree. Corbin's defense was that he had shot James Crockett in self-defense when Crockett entered his apartment. Following the jury's verdict, Corbin moved for a new trial. The motion was denied and the defendant appealed.
Corbin has charged various trial errors, none of which, after study, we find to bear merit.
Corbin claims the court was in error in refusing to allow his counsel to ask prospective jurors the question, "Have you ever served on a murder jury before?". The mere fact that a juror has served on a previous murder jury does not in and of itself present a cause for which the juror may be disqualified. As has often been stated, the purpose of a voir dire examination is to effectuate the selection of a competent, fair, impartial and unprejudiced jury. (Commonwealth v. McGrew, 375 Pa. 518.) Thus, the questioning is to be confined to disclosing qualifications or lack of qualifications of a juror and, particularly, whether a juror has formed a fixed opinion or may be otherwise subject to disqualification for cause. The inquiry as to previous jury service in a murder case would not, per se, reveal competence or lack of it in the juror. If the defense feared that a particular juror entertained a fixed opinion in murder cases, such bias could be ascertained through other relevant questioning. It is also to be noted that, as pointed out in the McGrew case, supra, the questioning in the voir dire examination remains within the scope of the trial judge's discretion. We do not find any abuse of discretion for the reason here discussed.
Corbin also charges that the court erred, because, in its charge, the court said: "The consequences are not *27 yours, but follow the crime and not the findings." The defendant has here taken one sentence out of context. The court's full statement on this phase of instruction reads: ". . . You have sworn to make a true deliverance between the Commonwealth and the Defendant, and to render a verdict in accordance with the evidence. You must not swerve from the duty because of the consequences of your findings. The consequences are not yours, but follow the crime and not the findings. You should then dismiss from your mind the fear of the consequences of your findings, except so far as their import should make you cautious, deliberate and just in considering the evidence, and clear and satisfied in the judgment you form upon it. If, through fear, pity, indignation or passion you suffer your mind to be drawn from a true and just verdict, you commit error." This statement is in accordance with established law and procedure.
Then the defendant maintains that the court committed prejudicial error, because in its charge, it referred to the victim of the homicide, James Crockett, on at least 15 occasions as either "James Corbet" or as "Corbet", and on at least two occasions it called the defendant, Henry Thomas Corbin, "James Corbin". Defendant fears that this misnaming (if such it can be termed) confused the jury. There is not the slightest indication that the jury was remotely confused as to the identity of the parties.
Finally, the defendant contends the verdict of guilty was contrary to the weight of the evidence and the law. It was the defendant's position that he shot the victim, James Crockett, when the latter forced himself into his apartment, because he, Corbin, feared for his life. As this court stated in Commonwealth v. Wilkes, 414 Pa. 246, self-defense is an affirmative defense, and the person who asserts such a defense must prove it by a preponderance of the evidence. When such evidence *28 is presented, it is still for the jury to determine if it is to be accepted, even though it might be uncontradicted. Thus, whether or not, under all of the testimony, Corbin was justified in taking Crockett's life was strictly a jury question. Reviewing the record we find no reason for reversing the jury's verdict or the action of the court below in refusing a new trial.
Judgment affirmed.
Mr. Justice ROBERTS concurs in the result.
Mr. Justice JONES and Mr. Justice COHEN took no part in the consideration or decision of this case. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534913/ | 5 B.R. 239 (1980)
In re Charles J. WALSH, Debtor.
Bankruptcy No. 80-00090.
United States Bankruptcy Court, District of Columbia.
July 11, 1980.
Robert O. Tyler, Washington, D.C., for himself as trustee.
Roy B. Zimmerman, Alexandria, Va., for debtor Charles J. Walsh.
MEMORANDUM OPINION
ROGER M. WHELAN, Bankruptcy Judge.
This matter came before the Court for hearing on an application for appraisal, pursuant to Local Bankruptcy Rule 24(b), filed by the trustee in bankruptcy, Robert O. Tyler, Esq., and the opposition thereto, filed by the debtor, Charles J. Walsh. Although *240 an application for an appraisal by the trustee may ordinarily be granted without a hearing, a dispute has arisen in the instant case with respect to the standard of valuation to be applied to property claimed by the debtor as exempt under 11 U.S.C. 522. The trustee's application seeks an appraisal of these assets at fair market value,[1] rather than liquidation value, on which basis a previous appraisal was made. There is no dispute as to the "disinterestedness" or qualifications of the appraiser.
The facts of record are as follows: An involuntary petition under Ch. 7 was filed against the debtor on March 14, 1980. An order for relief was entered, upon consent, on April 17, 1980, and the debtor filed a statement of affairs and schedules on May 16, 1980. A meeting of creditors pursuant to 11 U.S.C. 341 was set for May 28, 1980, and a fifteen-day period after the date of this meeting was set for the filing of objections to the debtor's claim of exempt property. (See Order dated May 16, 1980.) The trustee's application for appraisal was filed on June 17, 1980.
I. Timeliness of the Trustee's application
The first issue raised by the debtor is that the trustee's application is essentially an objection to the debtor's claim for exemptions, and, as such, is untimely filed. The trustee argues that (1) his application merely seeks a clarification of the statutory provision governing the value of exemptions and is not, in itself, an objection to the debtor's claim of exemptions; (2) if the application is deemed an objection, even then, it is timely filed, as the fifteen-day time limit is intended to apply to objections which could have been made on the basis of information reflected in the schedules. The trustee submits that, since the issue which he raises was not discoverable until after the fifteen-day period had elapsed, his application is not barred.
The court, however, is of the opinion that the application in this case, although not captioned as an objection to the claimed exemptions, is, in substance, an objection, because it calls into question the amounts claimed as exempt on the basis of their valuation. If the assets claimed as exempt exceed the monetary limits set forth in 522(d), then only to that extent, they are non-exempt assets.
Although Local Bankruptcy Rule 24 does not contain a time limit for the filing of an objection to claimed exemptions, a limitation is expressly set forth in the order for meeting of creditors, as this tracks the procedure under the old Bankruptcy Act, as set forth in Bankruptcy Rule 403.
The court finds, therefore, that the trustee's application is untimely filed.
Although dispositive of the matter pending before the Court, the crucial significance of the issue raised by the Trustee, as to the definition of value, should be addressed by the Court because of its relevance and likelihood of recurrence in Ch. 7 (liquidation) cases.
II. Fair Market Value
"Value", for the purposes of the exemption section, is defined as "fair market value as of the date of the filing of the petition." [11 U.S.C. § 522(a)(1)] This definition governs the meaning of "value" only for purposes of this section, and differs from the definition applicable in other sections of the Code. [11 U.S.C. 102(8)] The legislative history does not elaborate on the purpose or significance of this specific definition in Section 522. See: H.R.Rep. 595, 95th Cong., 1st Sess.(1977) 360. S.Rep. 989, 95th Cong., 2nd Sess. (1978) 75, U.S.Code Cong. & Admin.News 1978, p. 5787.
The rules of statutory construction dictate that, where the language of a statute is clear, the Court should interpret it according to its "plain meaning." However, a statute is to be interpreted as a whole, and one provision should not be construed in a manner inconsistent with the *241 whole. 2A Sutherland Statutory Construction (4th Ed.1973) §§ 46.01, 46.05 at 48, 56.
Thus, in construing the meaning of the definition of value in Section 522, the Court must look to the usual and accepted meaning of "fair market value," while taking into consideration the liquidation context and the goals of the Code as as whole. Fair market value has been defined as the "price at which a willing seller and a willing buyer will trade." Fair market value "assumes agreement between owner willing but not obliged to sell for cash and buyer desirous but not compelled to purchase." Black's Law Dictionary 716 (4th Ed.1968). In ascertaining fair market value, "there should be taken into account all considerations that fairly might be brought forward and reasonably be given substantial weight in bargaining." Karlson v. U.S., 82 F.2d 330, 337 (8th Cir. 1936), citing Olson v. U.S., 292 U.S. 246, 257, 54 S. Ct. 704, 709, 78 L. Ed. 1236 (1934).
The definition is "not invariable," but "varies with the circumstances surrounding a given object and situation to which it is sought to apply the term." McDougall Co. v. Atkins, 201 Tenn. 589, 301 S.W.2d 335, 337 (1957) (valuation for sales tax purposes, of air ducts installed in buildings, held not equivalent to scrap value). "A valuation is always a stage in some proceeding which has a practical purpose." McCormick, The Law of Damages, § 43 at 163 (1935). Thus, the Courts have viewed fair market value in the context in which the valuation question has arisen.[2]See: McCormick, The Law of Damages, § 43, § 44 at 163, 167 (1935).
In light of the rules of statutory construction, this contextual approach to the definition of "fair market value" appears particularly appropriate where the term appears in a statute. See: Sutherland, supra.
In the instant case, the trustee argues that the § 522(a)(1) definition of value should be construed literally and independently of the Ch. 7 context, rather than as "liquidation value." Counsel for the debtor, on the other hand, argues that the definition of "market" on the day a bankruptcy petition is filed, is, invariably, an eventual bankruptcy sale. Thus, he submits that the assets claimed as exempt should be appraised according to their liquidation value.
Inasmuch as the purpose of valuation under the exemption provisions is ultimately to determine whether such property is subject to liquidation by the trustee because it is in excess of specified monetary amounts, the Court believes that the term "fair market value," as it is used to define "value" in Section 522, must be interpreted in the liquidation context in a Chapter 7 case.[3]
Therefore, the Court finds that, in the instant case, "fair market value," as the term is used in Section 522, is equivalent to liquidation value. Accordingly, the trustee's application for an appraisal is denied.
NOTES
[1] Section 522(a) of the Code defines value as follows: "fair market value as of the date of the filing of the petition." 11 U.S.C. 522(a)(2).
[2] The term's meaning in the exemption provision would thus not necessarily be consistent with its meaning in the determination of insolvency under the Old Act, for instance. Cf.: 1 Collier on Bankruptcy ¶ 1.19 at 122-125 (14th Ed.)
[3] This is illustrated by the following hypothetical situation. A debtor owns an automobile, free and clear of any lien, which, if sold under ordinary market conditions the willing buyer and willing seller approach to the fair market value would yield $2,000. The debtor, pursuant to 11 U.S.C. 522d(2), claims the auto as exempt to the extent of $1,200. If the Court deems the asset to be worth $2,000 because of a theoretical fair market value standard and authorizes a sale by the Trustee, the resulting sale, of necessity, in the actual forced sale setting, may bring only $1,200 the amount which the debtor is entitled to claim as exempt. Obviously, in this situation, no benefit to the estate is gained because the only amount realized is subject to the debtor's claim of exemption. Accordingly, the only conclusion that can be logically drawn is that fair market value, as defined in 522(a), is subject to bankruptcy market conditions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1534918/ | 5 B.R. 192 (1980)
In the Matter of Jack W. DORRICOTT, Debtor.
Bankruptcy No. 579-874, Adversary No. 580-0009.
United States Bankruptcy Court, N.D. Ohio.
July 8, 1980.
Gerald B. Graham, Ravenna, Ohio, for defendants.
Kathryn A. Belfance, Akron, Ohio, trustee.
FINDING IN THE MATTER OF JACK W. DORRICOTT
H.F. WHITE, Bankruptcy Judge.
The duly elected trustee, Kathryn Belfance, filed a complaint to recover certain property that the debtor had in his possession and control on the date of filing his petition in bankruptcy on October 17, 1979.
The debtor, who is a lecturer at the University of Akron and a consultant on marketing and finance matters, and his son, Tom Dorricott, filed an answer to said complaint claiming the said proceeds were exempted as provided for under 11 U.S.C., section 522 of the Bankruptcy Code and section 2329.66 of the Ohio Revised Code as *193 amended, and further that Tom Dorricott alleges that the funds on deposit in bank account 2811-2821 at the First National Bank of Akron, Ohio are funds belonging to him and that on or about October 17, 1979, he was holding no funds in said account belonging to his father, the debtor.
The matter was duly set for trial. The only witness appearing was the debtor, Jack W. Dorricott.
The Court makes the following finding of fact from the testimony and exhibits submitted.
1) Jack W. Dorricott, the debtor, filed a voluntary petition in bankruptcy on October 17, 1979.
2) The debtor failed to list in his schedules the marketing-consulting fee of Three Hundred Dollars ($300.00) due him which was unpaid at the time of the filing of the bankruptcy.
3) On Schedule B-2, the debtor indicated there was no cash on hand nor did he have any deposit of monies at any banking institution.
4) On Schedule B-4 he claimed personal household furnishings, appliances, household goods, books and wearing apparel to the extent of Twelve Hundred Dollars ($1200.00). Also he claimed books and clothing as used in his trade to the extent of Seventy Five Hundred Dollars ($7500.00), and equity in a 1977 Toyota which was transferred to his son in September, 1978.
5) The debtor did not schedule any creditors under A-2 but listed eleven (11) creditors under A-3 as being unsecured, and totaling Eight Thousand Eight Hundred Ninety Dollars and Twenty Two Cents ($8,890.22).
6) The first meeting of creditors was held on November 13, 1979 and the debtor subsequently amended his schedules on December 20, 1979 to list three additional creditors as unsecured, totaling Thirteen Thousand Two Hundred Fourteen Dollars and Fifteen Cents ($13,214.15).
7) The debtor admitted he was aware that he was obligated to these three creditors on the date of filing the petition in bankruptcy, but he knowingly did not list them as he intended to pay them after filing the petition in bankruptcy and did subsequently reaffirm these debts.
8) The debtor admitted that he was obligated to pay his wife's attorney fees as ordered by the Court in Michigan, however, said counsel was not listed as the debtor was not aware of the amount, but the debtor knew he was obligated to pay said counsel.
9) The debtor admitted opening an account with First National Bank of Akron in his name in January or February, 1979, and that he subsequently had said account made into a joint account in his own name and in the name of his son, Tom Dorricott, who was a dependent and a student at Wooster College.
10) Subsequently, the account was closed by the debtor and a new account at the First National Bank 2811-2821 was opened in the name of Tom Dorricott, 924 Sugar Road, Copley, Ohio 44321. The debtor deposited said funds into the account which came from his salary and unemployment compensation from the State of Michigan, and that on the date of the filing of the petition in bankruptcy, there was in this account One Thousand Nine Dollars and Twenty Five Cents ($1,009.25) which were assets owned by this debtor which he failed to disclose in his petition.
11) The debtor admitted that he prepared checks for disbursement from said account and had his son execute said checks, and that disbursements from said account were for payment of the obligations of the debts as indicated in Defendant's Exhibit 8, being check 152 to Juanita Dorricott in the amount of One Hundred Dollars ($100.00) for support payment; check 154 to Postal Finance in the amount of One Hundred Fifty Dollars ($150.00) dated October 28, 1979; check 151 to Oscar Fraley in the amount of Three Hundred Fifty Dollars ($350.00) for rent dated October 16, 1979; check 149 to Attorney Gerald B. Graham for bankruptcy fees; check 142 in the amount of Twenty Dollars ($20.00) to the *194 University of Akron Faculty Club; check 145 to Michigan National bank in the amount of One Hundred Twenty Three Dollars and Forty Five Cents ($123.45), etc.
12) The Court finds that on March 10, 1980, approximately two (2) weeks after the first pre-trial which was held February 25, 1980, and after the objection to exemptions by the trustee on January 15, 1980, the debtor amended the claim of exemptions on March 10, 1980 to claim said exemption as allowed under the Ohio Revised Code 2329.66.
ISSUE
May the debtor claim exempt property which he knowingly concealed and failed to disclose to the trustee under 11 U.S.C. § 522 of the Bankruptcy Code and Ohio Revised Code 2329.66 which normally would be exempt had it been properly scheduled and claimed?
DISCUSSION OF LAW
A debtor may not claim exempt property which he has knowingly concealed from the trustee. To allow the debtor to claim exemptions out of such property would contravene the intentions of Congress set forth in section 522(g)(1) of the Bankruptcy Code.
11 U.S.C. § 522(g)(1) provides:
Notwithstanding sections 550 and 551 of this title, the debtor may exempt under subsection (b) of this section property that the trustee recovers under section 510(c)(2), 542, 543, 550, 551, or 553 of this title, to the extent that the debtor could have exempted such property under subsection (b) of this section if such property had not been transferred, if
(1)(A) such transfer was not a voluntary transfer of such property by the debtor; and
(B) the debtor did not conceal such property;
Section 522(g)(1) is analogous to a similar provision in section 6 of the Bankruptcy Act of 1898 as amended. Section 6, 11 U.S.C. § 24, was amended in 1938 as part of the Chandler Act and was designed to resolve the dispute as to whether the debtor might amend his schedule to claim exemptions out of property recovered by the trustee. Section 6 clearly prohibited an allowance for exemptions out of property which the debtor had fraudulently conveyed or concealed from the trustee:
This Act shall not affect the allowance to bankrupts of the exemptions which are prescribed by the laws of the United States or by the State laws in force at the time of the filing of the petition . . . Provided however, That no such allowance shall be made out of property which a bankrupt transferred or concealed which is recovered . . .
11 U.S.C. § 24 (repealed 1978).
Both section 6 of the Bankruptcy Act and section 522(g)(1) of the Bankruptcy Code should be interpreted in conjunction with section 521 of the Bankruptcy Code and Rules 108 and 403 of the Bankruptcy Rules of Procedure. These provisions place an affirmative statutory duty on the debtor to cooperate with the trustee. Section 521 requires that the debtor list his creditors, file a statement of his financial affairs, and turn over property of the estate to the trustee. Rule 108 provides that the statement disclosing his financial affairs must be complete and requires that the debtor list ". . . all his debts and all his property." Rule 403 further specifies that the debtor must claim his exemptions on the original schedule of assets filed pursuant to Rule 108. Failure to comply with these duties may result in a forfeiture of the exemptions that might otherwise have been claimed, 11 U.S.C. § 522(g)(1), or even in a denial of discharge, 11 U.S.C. § 523.
In the matter before the Court, the debtor knowingly failed to meet these statutory requirements. He maintains that the incomplete statement of his financial affairs resulted from a misunderstanding with regard to his duties. However, the debtor is a highly-educated man who keeps fastidious records. He is a university instructor and has twenty years' experience in the insurance business. Many less sophisticated *195 debtors are able to understand the simple directions clearly printed on the forms for filing bankruptcy. The Court is unable to accept the debtor's explanation that he misunderstood his duties.
Moreover, the debtor admitted to a series of acts which viewed cumulatively evince a pattern of concealment. Not only did he knowingly fail to disclose the existence of the disputed funds, he also neglected to list a consulting fee due him and failed to schedule several creditors he intended to pay in full. Most importantly, however, the debtor transferred both the disputed funds and an automobile to his son, but retained the use and possession of these assets for himself. He effectively put the assets beyond the reach of his creditors, yet continued to control the property which he had transferred. This arrangement depicts a constructive trust and signifies fraud.
The principle that a constructive trust constitutes fraud is firmly entrenched in the law. The ancient decision in Twyne's Case, 76 Eng.Rep. 809 (1601), reprinted in J. Hanna & J. MacCachlan, Creditors' Rights 149-52 (4th ed. 1957), analyzes the identical situation presently before the Court:
. . . and it is to be presumed that the father, if he had not been indebted to others, would not have dispossessed himself of goods and subjected himself to his cradle; and therefore it shall be intended that the transfer was made to defeat creditors . . . a trust implied is, when a man makes a gift without any consideration, or on a consideration of nature or blood only. . . . Id. at 151.
Modern statutes have codified this principle. For example, section 1335.01 of the Ohio Revised Code provides, "All deeds of gifts and conveyances of real or personal property made in trust for the exclusive use of the person making the same are void. . . ." Similarly, section 4 of the Uniform Fraudulent Conveyance Act provides that a ". . . conveyance made by a person who is . . . insolvent is fraudulent as to creditors without regard to his actual intent if the conveyance was made without adequate consideration."
These standards are also set forth in section 548 of the Bankruptcy Code:
§ 548 Fraudulent transfers and obligation
(a) The trustee may avoid any transfer of an interest of the debtor in property, or any obligation incurred by the debtor, that was made or incurred on or within one year before the date of the filing of the petition, if the debtor
(1) made such transfer or incurred such obligation with actual intent to hinder, delay or defraud any entity to which the debtor was or became, on or after the date that such transfer occurred or such obligation was incurred, indebted; or
(2)(A) received less than a reasonably equivalent value in exchange for such transfer or obligation; and
(B)(i) was insolvent on the date that such transfer was made or such obligation was incurred, or became insolvent as a result of such transfer or obligation;
(ii) was engaged in business, or was about to engage in business or a transaction, for which any property remaining with the debtor was an unreasonably small capital; or
(iii) intended to incur, or believed that the debtor would incur, debts that would be beyond the debtor's ability to pay as such debts matured.
11 U.S.C. § 548 (1978).
The account in the name of the debtor's son was opened while the debtor was experiencing financial difficulties because of his recent divorce and career changes. He deposited all his available funds into the account, closed out the account which he held jointly with his son, and paid his living expenses by checks which his son signed. When he filed a petition in bankruptcy a mere three months later, he failed to reveal the funds.
It was only through the efforts of the trustee in her examination of the debtor that the concealed funds were discovered. Had the debtor not subsequently amended his schedule to claim exemptions from the funds, the trustee could have avoided the *196 transfers of cash to the son's bank account under section 548 and could have recovered the funds for the estate under section 550. Consequently, section 522(g) is applicable and its prohibition on the allowance of exemptions out of concealed property must govern the issue.
The analogous provision in section 6 of the Bankruptcy Act, 11 U.S.C. § 24, repealed (1978), has been applied to similar fact patterns. For example, in Gardner v. Johnson, 195 F.2d 717 (9th Cir. 1952), the homestead exemption was invalidated because the debtor had fraudulently conveyed the property to her daughter and had omitted a claim for exemptions from her schedule. The court held that ". . . the conveyance by the bankrupt was an abandonment of any right of homestead." Id. at 720.
Similarly, the court in the matter of In re Sherk, 108 F. Supp. 138 (N.D.Ohio 1952), denied the debtor a cash exemption out of funds brought into the estate by the trustee through the avoidance of a fraudulent transfer made by the debtor prior to bankruptcy. The Court stated, "Had it not been for the diligence of the trustee in recovering the funds and property which the bankrupt had placed beyond his jurisdiction and out of his possession, there would be no fund . . . out of which the bankrupt could claim any exemptions." Id. at 142.
It must also be noted that this Court sits in equity, 28 U.S.C. § 1481 (1978), and that the debtor is under a duty to do equity before he can claim his right to exemptions. Stewart v. Ganey, 116 F.2d 1010, 1011 (5th Cir. 1941). This factor was considered in the case of Hyman v. Stern, 43 F.2d 666 (4th Cir. 1930):
While it is well-established law that exemptions in behalf of unfortunate debtors are to be liberally construed in furtherance of the object of such statutes, so also, must it be remembered that courts of bankruptcy proceed upon equitable principles and should no more sustain a positive fraud than would a court of equity." Id.
The debtor's actions undermine the fundamental purposes of bankruptcy law which seeks to treat all creditors fairly. Chicago, Burlington and Quincy Railroad Co. v. Hall, 229 U.S. 511, 515, 33 S. Ct. 885, 886, 57 L. Ed. 1306 (1913), and to provide the honest debtor with a fresh start, Hyman v. Stern, 43 F.2d 666, 668 (4th Cir. 1930). For these reasons, the debtor may not now claim exemptions out of the One Thousand Nine Dollars and Twenty Five Cents ($1,009.25) on deposit in bank account 2811-2821 at the First National Bank of Akron on the date of the filing of the petition in bankruptcy.
CONCLUSION
It is the conclusion of this Court that the complaint of the trustee to recover said funds in the amount of One Thousand Nine Dollars and Twenty Five Cents ($1,009.25) must be sustained and that the application of the debtor to claim said funds exempt must be denied. | 01-03-2023 | 10-30-2013 |
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