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https://www.courtlistener.com/api/rest/v3/opinions/1540601/ | 536 Pa. 490 (1994)
640 A.2d 386
Thomas DILLON, Appellant,
v.
WORKMEN'S COMPENSATION APPEAL BOARD (GREENWICH COLLIERIES), Appellee.
Supreme Court of Pennsylvania.
Argued September 23, 1993.
Decided April 20, 1994.
*491 Alexander J. Pentecost, Amiel B. Caramanna, Jr. and Elizabeth A. Gebhardt, Pittsburgh, for appellant.
Robert G. Rose and James C. Munro, II, Johnstown, for appellee.
Before NIX, C.J., and LARSEN, FLAHERTY, ZAPPALA, PAPADAKOS, CAPPY and MONTEMURO, JJ.
OPINION
ZAPPALA, Justice.
The narrow question in this case arising under the Workmen's Compensation Act is whether the appellant met his burden of proof with respect to his petition seeking to modify an award of compensation for partial disability to one for total disability. To answer this question, however, we must examine the broader issue of what elements make up that burden of proof.
Thomas Dillon suffered a lower back strain while working for Greenwich Collieries on September 13, 1976. Compensation for total disability was paid pursuant to a Notice of Compensation Payable issued September 30, 1976. These *492 benefits were terminated as of May 30, 1978, when Dillon executed a Final Receipt. Dillon received compensation again pursuant to a Supplemental Agreement for a brief period from August 30 to September 11, 1978.
It appears that on November 15, 1978, Dillon suffered another injury, and received compensation for the period through January 21, 1979, when he returned to work at wages equal to or greater than his pre-injury wages. On the day after he returned to work, however (January 22, 1979), Dillon suffered a recurrence of the original back injury. He filed a claim petition, which was later amended to be treated as a reinstatement petition.
Hearing was held on June 20, 1980, and on March 4, 1981, the referee awarded compensation for partial disability, consistent with the stipulation of the parties that there were jobs available of a light and sedentary nature that Dillon could perform given his physical limitations. Benefits were set at a weekly rate of $135.58, being sixty-six and two-thirds per cent of the difference ($203.38) between Dillon's average weekly wage ($319.38) and the wage for a forty hour week at the then-current federal minimum wage of $2.90 per hour ($116).
Dillon continued receiving compensation for partial disability through July of 1982, when he filed a petition for review asserting that as of January 15, 1982, he had become totally disabled. At a hearing on August 3, 1983, this was amended to a petition for modification. The referee received the deposition of Dillon's physician, who indicated that as of the date of examination, January 15, 1982, Dillon was unable to perform the work he had been performing when injured in 1976. He suggested that further vocational rehabilitation testing would be required to determine whether Dillon could engage in any type of selective or restricted duties. Dillon testified about his condition, and stated that while he was willing to try some type of light work, he had searched for such work and found none available.
Greenwich argued that the petition was an improper attempt to attack the unappealed March 4, 1981, award of *493 compensation for partial disability. It also argued that the evidence was insufficient to support the claim for modification, since the physician's testimony did not indicate a change in Dillon's condition from the time of the March 4 award.
On February 6, 1984, the referee ruled in favor of Dillon, and ordered the payment of compensation for total disability as of January 15, 1982. On appeal, the Workmen's Compensation Appeal Board reversed and remanded, finding that the referee had improperly closed the record and decided the case without receiving a physician's deposition that Greenwich had sought to introduce.
After receiving the deposition, the referee again granted the modification petition, making the following relevant findings of fact:
9. Claimant has not been employed at all since he last worked for the defendant during January, 1979.
10. Prior to Referee Moraca's decision dated March 4, 1981, the parties agreed by stipulation that the defendant could show that work was available to the claimant that he could perform within the limitations imposed on him by his partial disability. No evidence of such work availability was submitted by the defendant prior to Referee Moraca's decision, nor has any such evidence been submitted since that decision.
11. Since Referee Moraca's decision the claimant has attempted to find employment but has been unable to do so.
12. Claimant has not shown that there has been any change in his compensable injury since Referee Moraca's decision.
13. Claimant has remained unable to return to his regular work for the defendant from January, 1979 through the present time.
14. This present Referee accepts the testimony of Dr. Vanderschilden and finds as a fact that the claimant is able to perform sedentary work, within the limits stated by Dr. Vanderschilden.
*494 The referee also made the following pertinent conclusions of law:
2. This Referee has concluded that the stipulation as to the availability of work which was submitted to Referee Moraca does not extend beyond the date of Referee Moraca's decision. In reaching this conclusion, this referee has considered that the claimant never returned to any employment, that no evidence as to the availability of such employment has been submitted, and that the claimant has not been able to find employment since Referee Moraca's decision.
3. Claimant in this case is not required to show that his compensable injury has changed since Referee Moraca's decision dated March 4, 1981.
In response to Greenwich's further appeal, on June 5, 1987, the Board again reversed and remanded for new findings of fact and conclusions of law. The Board, citing Mancini v. Workmen's Compensation Appeal Board, 64 Pa.Commw. 484, 440 A.2d 1275 (1982), held that the party seeking a modification has the burden of proof and must show a change in physical condition since the date of the award or agreement sought to be modified. Dillon filed a petition for rehearing, which was granted, but on August 15, 1989, the Board affirmed its previous decision. Dillon's petition for review in Commonwealth Court was quashed as interlocutory, inasmuch as the Board had ordered the matter remanded for further findings of fact and conclusions of law. The referee made no new findings, and applying the law as instructed by the Board dismissed Dillon's petition for modification. The Board subsequently affirmed, incorporating its prior decisions.
On September 22, 1992, the Commonwealth Court affirmed the decision of the Board. The court cited its prior decisions in J & L Steel Corp. v. Workmen's Compensation Appeal Board (Shutak), 145 Pa.Commw. 99, 602 A.2d 467, allocatur denied, 530 Pa. 657, 608 A.2d 32, 530 Pa. 662, 609 A.2d 169 (1992) and Airco-Speer Electronics v. Workmen's Compensation Appeal Board, 17 Pa.Commw. 539, 333 A.2d 508 (1975) as "mandating that a party who seeks modification of an award or agreement for compensation has the burden to produce *495 competent evidence of change in the worker's physical condition since the award or agreement date." Memorandum Opinion at 4. We granted Dillon's petition for allowance of appeal, 534 Pa. 642, 626 A.2d 1160.
Both parties acknowledge that the starting point for analyzing this case is Section 413 of the Workmen's Compensation Act, Act of June 12, 1915, P.L. 736, as amended, 77 P.S. § 772. That section provides that
A referee designated by the department may, at any time, modify, reinstate, suspend, or terminate a notice of compensation payable, an original or supplemental agreement or an award of the department or its referee, upon petition filed by either party with the department, upon proof that the disability of an injured employe has increased, decreased, recurred, or has temporarily or finally ceased, or that the status of any dependent has changed. . . . And provided further, That where compensation has been suspended because the employe's earnings are equal to or in excess of his wages prior to the injury that payments under the agreement or award may be resumed at any time during the period for which compensation for partial disability is payable, unless it be shown that the loss in earnings does not result from the disability due to the injury.
As we observed in Kachinski v. Workmen's Compensation Appeal Board (Vepco Construction Co.), 516 Pa. 240, 532 A.2d 374 (1987), this section "governs the procedure for filing a modification petition" but it "provides no guidelines for ruling on the merits". 516 Pa. at 244, n. 1, 532 A.2d at 376, n. 1. "[T]o date the General Assembly has seen fit to allow the courts to wrestle with this issue." Id.
The "change in physical condition" requirement may be traced to Henderson v. Air Master Corporation, 2 Pa.Commw. 275, 276 A.2d 581 (1971). In Henderson, the claimant's reinstatement petition seeking compensation for total disability was filed after the claimant had received compensation for partial disability for the entire 350 weeks then authorized under the Act. Unlike compensation for total disability, which *496 has no fixed duration, the Act places a limit on the amount of time that a claimant may receive compensation for partial disability. By the terms of the statute, such compensation ceases when the maximum number of weeks has been reached regardless of whether the claimant's earning power has returned to its pre-injury level or remains at a reduced level on account of the injury.
Henderson had not worked at all since the date of the injury. Under the circumstances, the court viewed his reinstatement petition as an improper attempt to relitigate the original decision awarding him compensation for partial disability rather than for total disability. Thus the court's emphasis on Henderson's failure to show "a change in the percentage of disability from the original determination to the date of the application for reinstatement," 2 Pa.Commw. at 278, 276 A.2d at 582, may be seen as a means of ensuring that the statutory scheme would not be compromised.
The court expounded on this reasoning in Banks v. Workmen's Compensation Appeal Board, 15 Pa.Commw. 373, 327 A.2d 404 (1974). In that case the claimant received compensation for total disability for slightly more than a year. The employer then filed a petition for termination or modification. After hearing, the referee dismissed the petition. Five months later, the employer again filed a petition for termination or modification, and this time the petition was granted, the referee awarding benefits for partial disability. Commonwealth Court reversed, finding that the decision was not supported by substantial evidence. The court noted that the employer's physician testified that there had been no change in the claimant's condition from the examination before the first hearing to the examination before the second hearing.
The court applied the holding in Henderson, and observed The efficacy of this holding is made abundantly clear by the fact that [the employer] filed its petition for modification less than five months after the referee's award was made. Absent the requirement of showing a change in disability, a disgruntled employer (or claimant) could repeatedly attack *497 what he considers an erroneous decision of a referee by filing petitions for modification based on the same evidence ad infinitum, in the hope that one referee would finally decide in his favor. The proper, and only, method of attacking an erroneous decision of a referee is by an appeal to the Board and subsequently to this Court.
15 Pa.Commw. at 377, 327 A.2d at 406.
The same point was made again in Airco-Speer Electronics v. Workmen's Compensation Appeal Board, 17 Pa.Commw. 539, 333 A.2d 508 (1975). In that case, the parties entered into an agreement providing for compensation for total disability. Approximately a year and a half later the employer filed a termination petition. After hearing, the referee entered an award reinstating the agreement in modified form, that is, providing compensation for total disability for several months and for partial disability thereafter. Two months later the claimant filed a petition seeking to modify the award to provide compensation for total disability.
The referee granted the petition and the Board affirmed, but the Commonwealth Court reversed, holding that there was no substantial evidence to support the finding that her disability had increased after the date of the award. Despite evidence that following the award the claimant had attempted to perform the job and had been unsuccessful, the court stated that "[h]er ability to perform this job had already been litigated and resolved ... and was not at issue on claimant's present petition to modify. The only issue at this second hearing was whether or not claimant's disability had increased." 17 Pa.Commw. at 542, 333 A.2d at 510.
Finally, in Cerny v. Schrader & Seyfried, 463 Pa. 20, 342 A.2d 384 (1975), the referee found that the claimant was not totally disabled because he was able to engage in light work. The Board reversed, awarding total disability benefits because the employer had not shown that light work was available which the claimant was capable of obtaining. Commonwealth Court in turn reversed the Board, holding that the claimant had failed to show an increase in disability.
*498 Citing Airco-Speer Electronics, Banks, and Henderson, we stated that "it was Cerny's burden, as movant, to prove that his disability had increased after the date of the Referee's award for partial disability." 463 Pa. at 24, 342 A.2d at 386. We observed, however, that this did not require that he prove that he was incapable of performing any job. Stating that the same allocation of burdens of proof should apply to modification proceedings as had been settled upon for initial applications for compensation in Barrett v. Otis Elevator Company, 431 Pa. 446, 246 A.2d 668 (1968), we ruled
that the claimant in a modification proceeding, alleging total disability, initially has the burden of proving an increase in disability and that he is incapable of performing his regular employment. Once having met this burden a finding of total disability is warranted unless the employer discharges his burden of proving that work is available which the claimant is capable of obtaining.
463 Pa. at 25, 342 A.2d at 387. Because neither the referee nor the Board had addressed whether the claimant had established an increase in disability, we vacated the Commonwealth Court order and remanded for a finding of fact on this point.
Greenwich identifies a number of decisions of this Court and Commonwealth Court following Cerny applying the rule that a party seeking modification must show a change in the employee's physical condition. See Beissel v. Workmen's Compensation Appeal Board (John Wanamaker, Inc.), 502 Pa. 178, 465 A.2d 969 (1983); Spinabelli v. Workmen's Compensation Appeal Board (Massey Buick, Inc.), 149 Pa.Commw. 362, 614 A.2d 779 (1992); Klingler v. Workmen's Compensation Appeal Board, 50 Pa.Commw. 335, 413 A.2d 432 (1980).
Recently, however, in Lukens, Inc. v. Workmen's Compensation Appeal Board (Williams), 130 Pa.Commw. 479, 568 A.2d 981 (1989), allocatur denied, 527 Pa. 656, 593 A.2d 426 (1990), Commonwealth Court stated "it has long been established in the workmen's compensation area that proof of a change in medical condition is not required when that is not the basis for seeking a decrease in benefits." 130 Pa.Commw. at 484, 568 A.2d at 984-985. (Emphasis added.)
*499 In that case, the parties had signed an agreement providing for compensation for total disability shortly after the employee's injury. Some seven years later, the employer made available to the claimant a light duty job within his medical restrictions. The referee granted the employer's petition for modification, finding that the employer had met its burden of proof that the claimant's disability had been reduced from total to partial as of the date the light duty job was available to him. The Board reversed, finding that the employer had failed to meet its initial burden of showing change in condition, as outlined in Kachinski.
In reversing the decision of the Board, Commonwealth Court reproduced the Kachinski analysis:
1. The employer who seeks to modify the Claimant's benefits on the basis that he has recovered some or all of his ability must first produce medical evidence of a change in condition.
2. The employer must then produce evidence of a referral (or referrals) to a then open job (or jobs) which fits the occupational category for which the claimant has been given medical clearance, e.g., light work, sedentary work, etc.
3. The claimant must then demonstrate that he has in good faith followed through on these job referral(s).
4. If the referral fails to result in a job then Claimant's benefits should continue.
Kachinski, 516 Pa. at 252, 532 A.2d at 380. The court then observed that "the basis for the referee finding that Claimant's disability had evolved from total to partial was not that Claimant's physical condition had improved," but that "Employer had made a medically approved position available to Claimant." 130 Pa.Commw. at 483, 568 A.2d at 983. The court then concluded that "it is not a prerequisite to produce medical evidence of a change in condition when the Petition for Modification involves a claimant with no improvement whatsoever. Any other reading of the Kachinski court's language would be nonsensical." Id. The court also cited several of its own cases prior to Kachinski where the employer *500 had not been required to prove change in condition when the petition was based on job availability rather than change in physical status.[1]
Dillon argues that "[if] the employer has the right to modify the Referee's Decision based on additional proof of work availability, even if there is no change in claimant's physical status, it is a matter of fairness and equity that the claimant should have the same right." Brief at 11. We agree. Our review of the cases stating otherwise convinces us that they were based on an unwarranted extension of the holding in Henderson, beginning with Airco-Speer, accompanied by a failure to adequately distinguish between the concepts of "injury" and "disability" in the worker's compensation field.
The Henderson rationalemaintaining the integrity of unappealed rulingsis unquestionably a laudable objective. Unlike factual determinations made in cases litigated in the courts, however, determinations of the status of an injured employee's disability are subject to change. The statute itself explicitly provides that "[t]he board, or referee designated by the board, may, at any time, modify, reinstate, suspend, or terminate, an original or supplemental agreement or an award, upon petition filed by either party. . . ." (Emphasis added.)
Henderson and Banks presented unique circumstances where the petitioning party requested a change without producing any evidence that had not already been considered in the initial determination. In Airco-Speer, however, the claimant presented evidence that was unavailable to the referee who had made the initial ruling, that is, evidence of her actual attempt to perform the light work offered to her and her inability to do so. Even though only two months had passed since the first referee's decision, this new evidence bearing on *501 the claimant's earning capacity was properly received and considered by the second referee. Commonwealth Court erred in extending the Henderson rationale to this situation.[2]
It also appears that "change in physical condition" gained heightened importance as a factor in the movant's burden of proof, to the extent of becoming a separate "requirement", as a result of application of a flawed conception of "disability" under the Act. As we emphasized in Kachinski, going back to early cases interpreting the Act, "we determine the degree of a worker's disability by reference to how the injury affected his earning power." 516 Pa. at 248, 532 A.2d at 378, citing Woodward v. Pittsburgh Engineering and Construction Co., 293 Pa. 338, 143 A. 21 (1928) ("The disability contemplated by the act is the loss, total or partial, of the earning power from the injury.") See also Unora v. Glen Alden Coal Co., 377 Pa. 7, 104 A.2d 104 (1954) ("In the interpretation of the Workmen's Compensation Act . . . the word `disability' is to be regarded as synonymous with `loss of earning power'."); Petrone v. Moffat Coal Co., 427 Pa. 5, 233 A.2d 891 (1967); Barrett v. Otis Elevator Co., 431 Pa. 446, 246 A.2d 668 (1968).
To the extent that cases such as Airco-Speer Electronic recognized disability (in the physical sense) as an element distinct from loss of earning power, they deviated from proper interpretation of the Act. Inasmuch as both capacity to work and availability of work affect the extent of an injured employee's disability (loss of earning power), it follows that disability, for compensation purposes, may change from partial to total or vice versa based on a change in one with or without a change in the other. Commonwealth Court correctly recognized this in Lukens when it held that the "medical evidence of *502 a change in condition" criterion recognized in Kachinski applies only when the employer "seeks to modify a claimant's benefits on the basis that he has recovered some or all of his ability," Kachinski, 516 Pa. at 252, 532 A.2d at 380 (emphasis added), and such proof "is not required when that is not the basis for seeking a decrease in benefits." Lukens, 130 Pa. Commw. at 484, 568 A.2d at 984.
This analysis is consistent with the reasoning we employed in Pieper v. Ametek-Thermox Instruments, 526 Pa. 25, 584 A.2d 301 (1990). There, we considered the burden of proof of a claimant seeking reinstatement of compensation where benefits had been suspended due to the claimant's return to fulltime employment. We distinguished this situation from circumstances where a claimant sought reinstatement after the liability of the employer for the injury had been terminated. We observed that
A "suspension of benefits" is supported by a finding that the earning power of a claimant is no longer affected by his disability, whether it arises from his employer offering suitable replacement employment, or from the ability of the claimant to secure other suitable employment that provides equal or greater compensation. Should a claimant seek to have a suspension lifted, he is required to demonstrate only that the reasons for the suspension no longer exist.
526 Pa. at 33, 584 A.2d at 304. We explained that "the causal connection between the original work-related injury and the disability which gave rise to compensation is presumed," id. at 33, 584 A.2d at 305 (emphasis in original), for two reasons. First, because the causal connection was established at the time of the original claim, and second, because
with a mere suspension of benefits, there is no contention by either party that the liability of the employer has terminated. The only fact established at a suspension of benefits is that the earning power of a claimant has improved to a point where benefits are no longer necessary. . . . Therefore, in these situations the causal connection between the *503 original work-related injury and the disability goes unquestioned.
Id. Ultimately, we concluded that
since many months or years may pass before the economic condition of a claimant forces him to apply for reinstatement of benefits, the law requires him to prove two things in order to show that the reasons for the suspension no longer exist. . . . First, he must prove that through no fault of his own his earning power is once again adversely affected by his disability. And Second, that the disability which gave rise to his original claim, in fact, continues. . . .
Id. (Citations and footnotes omitted.)
Notwithstanding the sometimes imprecise use of the term "disability", these passages from Pieper demonstrate that the elements of the burden of proof on a claimant seeking to change the status of his benefits will differ depending on whether the employer's liability has previously been terminated or merely held in abeyance. For this purpose, at least, an award of benefits for partial disability may be viewed as a "partial suspension" of benefits: the causal connection has been established, the employer's liability for the injury has not terminated but the claimant's earning power is such that benefits for total disability are not necessary, benefits for partial disability being sufficient.[3] If a claimant whose benefits have been entirely suspended may have them reinstated on proof "that through no fault of his own his earning power is once again adversely affected" by the injury which gave rise to *504 his original claim, we can discern no basis for requiring a claimant who receives benefits for partial disability to prove more, i.e., that his physical condition due to his injury has worsened.
It appears, then, that the referee who decided this matter on February 6, 1984, correctly assigned the burden of proof to Dillon as the party seeking the modification, and correctly concluded that the petition should be granted if Dillon proved that he was then unable to obtain any work within the physical limitations caused by his work-related injury. We have reviewed the record and conclude that the referee's findings that Dillon was able to perform sedentary work but that there was no work of this type available to him are supported by substantial evidence. The Board committed an error of law in reversing the award of compensation for total disability which was based on these findings.
The order of the Commonwealth Court affirming the order of the Workmen's Compensation Appeal Board is reversed. The referee's decision dated February 6, 1984, awarding compensation for total disability as of January 15, 1982, is reinstated.
LARSEN, J., did not participate in the decision of this case.
MONTEMURO, J., who was an appointed Justice of the Court at the time of argument, participated in the decision of this case in his capacity as a Senior Justice.
NOTES
[1] Investors Diversified Services v. Workmen's Compensation Appeal Board (Howar), 103 Pa.Commw. 562, 520 A.2d 958 (1987); W & L Sales Co., Inc. v. Workmen's Compensation Appeal Board (Drake), 92 Pa. Commw. 396, 499 A.2d 710 (1985); Yellow Cab Co. v. Workmen's Compensation Appeal Board (Drake), 37 Pa.Commw. 337, 390 A.2d 880 (1978); Chamberlain Corp. v. Pastellak, 7 Pa.Commw. 425, 298 A.2d 273 (1973).
[2] We recognize the possibility that unscrupulous employers or claimants could abuse the system by filing modification petitions with great frequency. The Act, however, provides that a party may seek modification "at any time". We can do no more to discourage vexatious litigation than enforce the Act by requiring the party seeking the modification to prove what the statute defines as grounds for such: "that the disability . . . has increased, decreased, recurred, or has temporarily or finally ceased. . . ." As we observed in Kachinski, "[o]bviously the viability of this system depends on the good faith of the participants." 516 Pa. at 252, 532 A.2d at 380.
[3] It is interesting to note that the Act itself accords a certain similarity of character to suspension of compensation and compensation for partial disability in the final proviso of section 413. ". . . And provided further, That where compensation has been suspended because the employe's earnings are equal to or in excess of his wages prior to the injury that payments under the agreement or award may be resumed at any time during the period for which compensation for partial disability is payable, unless it be shown that the loss in earnings does not result from the disability due to the injury." 77 P.S. § 772. Thus an employee who returns to work at wages equal to or greater than his pre-injury wages, and thus has his compensation suspended, is in the same position after 500 weeks, see 77 P.S. § 512, as an employee who returned to work at reduced wages and thus received compensation for partial disability, i.e., the employer's liability for benefits is terminated. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1338228/ | 145 Ga. App. 8 (1978)
244 S.E.2d 15
STATE OF GEORGIA
v.
MEREDITH CHEVROLET, INC. et al.
54590.
Court of Appeals of Georgia.
Argued October 11, 1977.
Decided February 3, 1978.
Rehearing Denied February 22, 1978.
Arthur K. Bolton, Attorney General, Victor M. Baird, Assistant Attorney General, for appellant.
Smith & Shiver, Truett Smith, Troutman, Sanders, Lockerman & Ashmore, William G. Vance, Frederick E. Link, for appellees.
SHULMAN, Judge.
Appellant brought this action under the Fair Business Practices Act of 1975, Ga. L. 1975, p. 376 et seq. (Code Ann. § 106-1201 et seq.) (hereinafter, "FBPA"), alleging that appellees violated the Act by "rolling back" *9 the odometers (changing the reading on the odometer to show fewer miles of operation than have actually occurred) of 78 cars which they sold at private (not open to the general public) auction to retail car dealers. It has been stipulated that no consumers participated directly in these sales by appellees and, for the purposes of this appeal, that appellees did roll back the odometers of the cars in question. This appeal is from a grant of summary judgment for appellees.
1. Although the basis of the grant of summary judgment was a holding that the FBPA is not applicable to transactions between dealers, appellees assert that there are two additional reasons for which the judgment should be sustained.
A. Code Ann. § 106-1205 (c) provides that the administrator "... shall refer all complaints or inquiries concerning conduct specifically approved or prohibited by [certain enumerated departments] or other appropriate agency or official of this State to that agency or official for initial investigation and corrective action other than litigation." The licensing and regulation of automobile dealers, which appellees are, is entrusted to the Georgia Franchise Practices Commission, which has the authority to censure licensees or suspend or revoke their licenses for enumerated wrongdoings. Code Ann. § 84-6601 et seq. Appellees insist that the admitted failure of the administrator to make a referral in this case constitutes a bar to the suit because the language of the section is mandatory. We agree that the language is mandatory, but the conduct complained of here has not been "... specifically approved or prohibited ..." by the Franchise Practices Commission. The conduct is made unlawful by an Act of our legislature. Ga. L. 1975, pp. 754, 755 (Code Ann. § 68-1828 (a)). Since the conduct involved here does not fall within the category referred to in section 5 (c), there was no requirement that the administrator refer the complaint or inquiry.
B. Section 7 (b) of the FBPA (Code Ann. § 106-1207 (b)) provides that the administrator "... shall, before initiating any legal proceedings as provided in this section, give notice in writing that such proceedings are contemplated and allow such person a reasonable *10 opportunity to appear before the administrator and execute an assurance of voluntary compliance as in this Chapter provided." In the order granting summary judgment, the trial court found that appellees had tendered an assurance of voluntary compliance which was rejected by the administrator as inadequate. Appellees contend that section 7 (b) is mandatory and that the Administrator had no authority to reject their assurance. This contention is unavailing when the section quoted above is considered along with section 12 of the Act (Code Ann. § 106-1212): "In the administration of this Chapter, the administrator may accept an assurance of voluntary compliance with respect to any act or practice deemed to be violative of the Chapter from any person who has engaged or was about to engage in such act or practice." (Emphasis supplied.) Appellees submit that the permissive wording of this section places it in direct conflict with the mandatory provisions of section 7 (b) and that this court should interpret section 12 to be mandatory as well. We disagree.
Adoption of appellees' proposed construction would render section 12 meaningless. "Every part of a statute must be reviewed in connection with the whole to harmonize all parts where practicable, it being presumed that the legislature did not intend for any part of a statute to be without meaning. [Cit.]" City of Gainesville v. Smith, 121 Ga. App. 117, 119 (173 SE2d 225). Although the legislature provided for procedures other than litigation (see, e.g., FBPA §§ 5 (c), 7 (b), and 10 (b)) to promote the stated objective that the proscribed conduct "... be swiftly stopped ..." (FBPA § 1 (b)), we will not presume that the legislature expected all alleged malefactors to quickly reform themselves upon notice that their conduct had been called into question. If the legislature had chosen to repose so much confidence in the efficacy of administrative procedures, surely they would not have bothered to provide the administrator with the power to bring suit. See FBPA §§ 7, 15.
We hold that the reasonable interpretation of the scheme of assurances of voluntary compliance contained in the FBPA is that the administrator must provide an opportunity to execute such an assurance but that he may *11 reject an assurance he deems, in the exercise of his discretion, to be inadequate. The record here clearly shows that the administrator exercised his discretion. "The law is well settled that where public officials `are acting within the scope of their duties and exercising a discretionary power, the courts are not warranted in interfering, unless fraud or corruption is shown, or the power or discretion is being manifestly abused to the oppression of the citizen.' [Cit.]" Hudspeth v. Hall, 113 Ga. 4, 7 (38 SE 358). Since appellees' motion for summary judgment did not address the issues of fraud, corruption or abuse of discretion, the administrator's rejection of appellees' assurance of voluntary compliance could not have served as a basis for summary adjudication for appellees.
2. Having disposed of the collateral issues appellees asserted as justification for summary judgment, we turn to consideration of the primary issue of this case: whether the conduct complained of here was within the scope of the FBPA. The trial court ruled that it was not, and we affirm that judgment.
In order for conduct to be actionable under the FBPA, it must be within that class of conduct made unlawful by Code Ann. § 106-1203 (a): "Unfair or deceptive acts or practices in the conduct of consumer transactions and consumer acts or practices in trade or commerce ..." Before determining whether the acts or practices are unfair or deceptive, the inquiry must be directed to the issue of whether the particular activity is within the regulatory scope of the Act, i.e., whether it occurred "... in the conduct of consumer transactions and consumer acts or practices..."
"[T]he FBPA is no panacea for the congenital ills of the marketplace ..." Rothschild, "A Guide to Georgia's Fair Business Practices Act of 1975," 10 Ga. L. R. 917 (1976). The legislature has evidenced a clear intent to limit the scope of the Act to the consumer market. The model Act on which Code Ann. Ch. 106-12 was based extended its coverage to all commercial dealings, outlawing "unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce ...," whereas the Georgia statute limits its *12 coverage to activities "... in the conduct of consumer transactions and consumer acts or practices in trade or commerce... " Code Ann. § 106-1203 (a). (Emphasis supplied.) (See generally, Smith, "Georgia's Deceptive Trade Practices Legislation," 10 Ga. S. B. J. 281 (1973)).
Considering the definition of a consumer transaction in Code Ann. § 106-1202 (g), "... the sale, lease or rental of goods, services, or property, real or personal, primarily for personal, family, or household purposes," we find it clear that, under the stipulated facts of this case, no consumer transaction was involved. Therefore, in order to find appellees' activities to be within the regulatory prohibitions of the FBPA, we must find that it occurred "... in the conduct of ... consumer acts or practices..." i.e., "acts or practices intended to encourage consumer transactions." Code Ann. § 106-1202 (h).
Taking into consideration the legislature's express and precise language which refines and limits the scope of the Act to consumer commerce, Code Ann. § 106-1203 (a), we hold that, to be subject to direct suit under the FBPA, the alleged offender must have done some volitional act to avail himself of the channels of consumer commerce. The allegedly offensive activity must have taken place "in the conduct of ... consumer acts or practices," i.e., within the context of the consumer marketplace.
In analyzing the context of a defendant's activities, two factors are determinative: (a) the medium through which the act or practice is introduced into the stream of commerce; and (b) the market on which the act or practice is reasonably intended to impact. It is only when the application of both of those factors indicates that the act or practice occurred within the context of the consumer marketplace that the fairness or deceptiveness of the act or practice need be examined. This is so because an act or practice which is outside that context, no matter how unfair or deceptive, is not directly regulated by the FBPA.
To illustrate the application of the two-pronged standard by specific example, we would find that promotional advertising through a public medium addressed to the consuming public to create a demand for a product, if done in a deceptive manner, would be a violation of the FBPA; advertising in a limited circulation *13 commercial or professional journal, even though deceptive, would not be violative if the medium chosen reasonably restricted the audience (i.e., market) to nonconsumers, even though the product so advertised were eventually to reach the hands of consumers. Deceptive advertisements, even though in a public medium, addressed to the nonconsuming public are not in contravention of the Act if such advertisements cannot be said to reasonably tend to encourage consumer transactions. Offering a product for sale by opening one's door to the general public should trigger the prohibitions of the act if some deceptive act or practice were involved; private offers for sale, communicated between merchants, would not.
Applying the standard set out above to the stipulated facts of this case, we find there has been no violation of the FBPA by the appellees. That is so because, although the deceptive act alleged, which is the misrepresentation inherent in rolling back an odometer and selling the altered vehicle to a retailer, can reasonably be said to tend to encourage a consumer transaction (thus supplying the market impact factor), the medium chosen to introduce that act into the stream of commerce, i.e., a private sale limited to nonconsumers, is outside the context of consumer commerce. While the specific act would be unlawful, and in fact prohibited by the Act, the context in which it occurred is without the regulatory authority of the Act.
It must be noted that we have not, with this decision, relieved the appellees of all liability for their stipulated actions. The legislature has provided sanctions for rolling back odometers. See Code Ann. §§ 68-1828 (a), 84-6610, and 26-1706. In addition, if an action for damages is brought against a retailer who bought an altered car from the appellees and resold it to a consumer, appellees can be held liable to that retailer for his damages. Code Ann. § 106-1210 (e).
What this decision has done is make meaningful the carefully selected language in section 1203 (a) which defines the scope of the FBPA. If the legislature had intended a scope commensurate with the model Act, it would have adopted the language of that model. It chose *14 not to do so and we are neither willing nor empowered to expand the coverage of the Act to the commercial market as a whole. "We are thus not taking that journey ... `beyond the limits of judicial restraint and into the area of judicial legislation.'" Redfern Meats, Inc. v. Hertz Corp., 134 Ga. App. 381, 390 (215 SE2d 10).
In summary, we have held that for an act or practice to come within the regulatory authority of the FBPA, it must occur within the context of consumer commerce. The activities of which appellees stand accused were in the conduct of neither consumer transactions nor consumer acts or practices within the contemplation of the Act and did not, therefore, subject appellees to direct suit under the FBPA. The grant of summary judgment to appellees is affirmed on that basis.
Judgment affirmed. Quillian, P. J., and Banke, J. concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4515683/ | NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAR 12 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
JAMES CARR, No. 19-15408
Plaintiff-Appellant, D.C. No.
2:17-cv-01539-JAM-AC
v.
AUTONATION, INC.; LKQ MEMORANDUM*
CORPORATION,
Defendants-Appellees,
and
JEFFREY DAVIS; WAYNE HUIZENGA,
Defendants.
Appeal from the United States District Court
for the Eastern District of California
John A. Mendez, District Judge, Presiding
Argued and Submitted February 13, 2020
Pasadena, California
Before: BERZON, R. NELSON, and LEE, Circuit Judges.
James Carr appeals the dismissal of his trade secret claim against AutoNation,
Inc. and LKQ Corporation and the judgment on the pleadings for the contract claim
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
in favor of AutoNation. We have jurisdiction under 28 U.S.C. § 1291, and we
review the district court’s decisions de novo. See Daewoo Elecs. Am. Inc. v. Opta
Corp., 875 F.3d 1241, 1246 (9th Cir. 2017) (judgment on the pleadings); Dougherty
v. City of Covina, 654 F.3d 892, 897 (9th Cir. 2011) (motion to dismiss). We affirm.
1. Tolling of statute of limitations: Carr has plausibly alleged that the
statute of limitations for his claims should be tolled. LKQ is not a consumer-facing
company, and we must credit at the pleading stage Carr’s assertion that he was no
longer involved in the automobile wrecking industry and that he did not learn of
LKQ’s existence until 2015.
2. Trade secret: Carr failed to plausibly allege that he took reasonable
efforts to maintain the secrecy of his business plan when he sent it to (among other
people) Wayne Huizenga, the founder of AutoNation. He failed to label the business
plan as confidential, and he never told AutoNation that the information was
confidential. Nor did he seek a non-disclosure agreement before sending his business
plan. Moreover, the business plan on its face does not appear to be something that
a reader would reasonably expect to be treated as confidential. Rather, it appears to
be a fairly standard business proposal that offers vague, general concepts and merely
aspirational language. For such a document, more is needed to preserve
confidentiality. See Clark v. Bunker, 453 F.2d 1006, 1009–10 (9th Cir. 1972)
(explaining that secrecy must exist such that, “except by the use of improper means,
2
there would be difficulty in acquiring the information”); Motor City Bagels, L.L.C.
v. Am. Bagel Co., 50 F. Supp. 2d 460, 480 (D. Md. 1999) (court finding no
reasonable efforts to maintain secrecy of business plan with a general disclaimer
because “[t]he language is not highlighted or isolated so as to put one on immediate
notice that the plan constitutes a trade secret that the authors of the plan are actively
seeking to protect”).
Trade secret law is a two-way street: It protects ideas, but it also requires
giving notice that the information is in fact a secret so that others do not fall into a
“trap” of using information that they think is non-confidential. BondPro Corp. v.
Siemens Power Generation, Inc., 463 F.3d 702, 708 (7th Cir. 2006) (“Failure to take
protective steps also sets a trap, since a company that ferrets out information that the
originator does not think special enough to be worth incurring any costs to conceal
will have no reason to believe that it is a trade secret.” (emphasis in original)).
An implied duty of confidentiality is found when the other party has reason to
know that the information was in fact confidential. See Restatement (Third) of
Unfair Competition § 41 cmt. b (Am. Law Inst. 1995) (“[N]o duty of confidence will
be inferred unless the recipient has notice of the confidential nature of the
disclosure.”). AutoNation, however, did not have any such notice.
Because Carr failed to take reasonable efforts to maintain the secrecy of his
business plan, neither AutoNation nor LKQ can be liable for trade secret
3
misappropriation. Whether Carr took reasonable efforts speaks to whether he had a
trade secret. Cal. Civ. Code § 3426.1(d)(2); Buffets, Inc. v. Klinke, 73 F.3d 965, 969
(9th Cir. 1996) (“[T]he issue of whether security measures were reasonable pertains
to the preliminary question of whether the material is in fact a trade secret.”). And,
as there was no trade secret for AutoNation to misappropriate, LKQ cannot be liable
for misappropriation of a trade secret, either.
3. Breach of contract implied-in-fact: Carr’s breach of contract implied-
in-fact claim also fails. We have held that, under California law, “no contract may
be implied where an idea has been disclosed not to gain compensation for that idea
but for the sole purpose of inducing the defendant to enter a future business
relationship.” Aliotti v. R. Dakin & Co., 831 F.2d 898, 902 (9th Cir. 1987) (internal
quotation marks omitted). “If disclosure occurs before it is known that compensation
is a condition of its use, . . . no contract will be implied.” Id. (internal citation
omitted).
Carr’s complaint and supporting documents show that Carr was seeking
investment, not offering the business plan for sale. Though Carr argues that this case
is similar to Gunther-Wahl Productions, Inc. v. Mattel, Inc., 104 Cal. App. 4th 27
(2002), Carr points to no similar industry custom to show that AutoNation
understood that he was selling an idea rather than seeking a continuing business
relationship. See 104 Cal. App. 4th at 30, 40. Though Carr also alleges that the
4
context made clear that he expected compensation, his allegations are conclusory.
See Chavez v. United States, 683 F.3d 1102, 1108 (9th Cir. 2012) (refusing to take
conclusory allegations as true).
AFFIRMED.
5 | 01-03-2023 | 03-12-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1563743/ | 558 S.W.2d 10 (1977)
Paul David QUINN, Appellant,
v.
The STATE of Texas, Appellee.
No. 53657.
Court of Criminal Appeals of Texas.
November 23, 1977.
*11 Elaine Brady, Court appointed on appeal only, Houston, for appellant.
Carol S. Vance, Dist. Atty., Robert A. Shults and Jack Bodiford, Asst. Dist. Attys., Houston, Jim D. Vollers, State's Atty., Austin, for the State.
OPINION
ROBERTS, Judge.
This is an appeal from a conviction for murder. The jury assessed the appellant's punishment at 99 years.
The appellant's contentions are numerous, but we abate the appeal.
The appellant filed a motion to suppress his oral and written confessions. The trial judge held a pretrial hearing in order to comply with Jackson v. Denno, 378 U.S. 368, 84 S. Ct. 1774, 12 L. Ed. 2d 908 (1964), and Article 38.22, Vernon's Ann.C.C.P.
In Hester v. State, 535 S.W.2d 354, 356 (Tex.Cr.App.1976), we stated:
"It is the trial court that is charged with finding the facts and applying the law. Art. 38.22, Sec. 2, V.A.C.C.P., requires the trial court to enter an order stating its findings. On appeal challenges to the trial court's ruling generally should be directed to whether the trial court abused its discretion in one of its findings of fact or to whether the trial court properly applied the law to those facts found by it. This Court is not the proper forum for the initial fact-finding process, but should restrict its review of the facts to any issues raised in challenge to the trial court's findings. Without adequate findings of fact this Court is much handicapped in its review upon appeal of the trial court's ruling, because it lacks an adequate record of the basis for that ruling. One purpose for requiring the trial court to `enter an order stating [its] findings' (Art. 38.22, Sec. 2, V.A.C.C.P.) is to make the record reflect, for the parties and for possible appellate review, the basis for the ruling."
In the present case, the trial judge's order recites four findings of fact. Three of the four findings of fact were not in dispute at the hearing. The fourth finding is, at best, conclusory. The order does not recite findings in detail, nor does it resolve numerous disputed fact issues upon which the appellant's grounds of error are based. It does not assist us in determining the sufficiency of the evidence to support whatever unstated findings of fact were made by the trial judge. We are unable to review the appellant's grounds of error which necessarily rely upon the factual findings from the hearing.
Article 38.22, Section 2, Vernon's Ann.C. C.P., requires an order reciting the trial judge's findings on relevant disputed fact issues. See also Jackson v. Denno, supra. The disputed fact issues are apparent from the parties' briefs filed in this case.[1] The trial judge, of course, may also review the *12 transcription of the testimony upon which the original order was entered to assist his recollection of the findings previously made.
Therefore, we abate the appeal and direct the trial judge to reduce to writing his findings on the disputed fact issues surrounding the taking of appellant's oral and written confessions, and to file with this Court his findings.
The appeal is abated.
NOTES
[1] These disputed fact issues include, but are not limited to, whether: (1) the appellant, prior to making the oral and written confessions, asserted his right to counsel; (2) the appellant asserted his right to remain silent; (3) the appellant was physically beaten at various times and by various officers during the evening in question; (4) the appellant was taken to an interrogation room and questioned prior to or after the search of his residence; (5) the witness Heiser had informed the police of the location of the pistol prior to the search of appellant's residence; and (6) the officers had seized the appellant's keys upon his arrest. These fact issues, among others, relate to the admissibility of the oral and written confession allegedly given by the appellant. The trial judge's conclusory findings of fact and conclusions of law are not sufficient. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563738/ | 960 A.2d 1097 (2008)
111 Conn.App. 724
Gordon L. JONES
v.
Linda C. JONES.
No. 29354.
Appellate Court of Connecticut.
Argued October 21, 2008.
Decided December 23, 2008.
*1098 Leon M. Kaatz, Hartford, for the appellant (plaintiff).
George W. Kramer, for the appellee (defendant).
FLYNN, C.J., and LAVINE and HENNESSY, Js.
PER CURIAM.
Our rules of practice provide that "[i]t is the responsibility of the appellant to provide an adequate record for review. The appellant shall determine whether the entire trial court record is complete, correct and otherwise perfected for presentation on appeal. For purposes of this section, the term `record' is not limited to its meaning pursuant to Section 63-4(a)(2), but includes all trial court decisions, documents and exhibits necessary and appropriate for appellate review of any claimed impropriety." Practice Book § 61-10. "Where the factual or legal basis of the trial court's ruling is unclear, the appellant should seek articulation pursuant to Practice Book § [66-5]." (Internal quotation marks omitted.) Moreira v. Moreira, 105 Conn.App. 637, 641, 938 A.2d 1289 (2008).
The plaintiff, Gordon L. Jones, appeals from the judgment of the trial court opening the judgment of dissolution and ordering him to pay the defendant, Linda C. Jones, 50 percent of his pension benefits, adjusted for coverture and the interim period between dissolution and retirement, and 50 percent of his accrued benefits, adjusted for the period of continued service from the date of the dissolution and the date of retirement. The plaintiff claims that the court improperly (1) opened the judgment, (2) concluded that paragraph twelve of the stipulated judgment of dissolution was ambiguous, (3) concluded that his accrued leave at the time of dissolution was property subject to division between the parties and (4) concluded that the dissolution judgment was manifestly unfair without considering the totality of the circumstances. The record is inadequate for us to review the plaintiff's *1099 claims, and, thus, we affirm the judgment.
On October 23, 2006, the defendant filed a motion to open the dissolution judgment on the basis of fraud.[1] The court held a hearing on December 22, 2006, and January 26, February 7 and 27 and March 29, 2007. The court rendered its decision on October 18, 2007. In its memorandum of decision, the court found that all of the witnesses testified credibly. It also found that the parties were married on September 10, 1983, and that two children were born of the marriage.[2] The plaintiff sought a dissolution of the marriage by complaint dated March 20, 2001. Both parties were represented by counsel, and the court rendered judgment of dissolution on October 21, 2002, incorporating the parties' separation agreement (agreement).[3]
Prior to the rendering of judgment in the dissolution action, the case was pretried by a special master, and three judicial pretrials were held. The parties did not reach agreement, however, until the morning trial was to commence. The financial affidavit filed by the plaintiff on October 21, 2002, represented that he was employed as a police officer by the city of Hartford and that his gross weekly earnings were $1556 and his net income was $1037. Under deferred compensation, he reported "Hartford police pension present value 2" as $98,966. The defendant's financial affidavit disclosed that she was employed as a receptionist by a law firm and that her gross weekly income was $300 and her net income was $230.
Following the dissolution, the qualified domestic relations order (QDRO) called for in § 12 of the agreement[4] became a matter of disagreement between counsel for the parties. Counsel met with representatives of the city of Hartford but failed to resolve their disagreement. Frank J. Romeo III, then counsel for the defendant, *1100 filed a motion for clarification and order postjudgment dated January 8, 2004. Leon M. Kaatz, counsel for the plaintiff, filed an objection. Counsel submitted briefs following oral argument held on July 14, 2004. The court found that "[i]t appears the pension provision was based on ambiguous or erroneous information" and on "the inclusion of overtime, vacation and sick pay in the computation of the value of the pension at the time of dissolution." George Kramer, substitute counsel for the defendant, thereafter filed a motion to open the judgment.
In its October 18, 2007 memorandum of decision, the court found that the alimony provision of the agreement continued to be fair and equitable. The court also found, on the basis of testimony from Elaine Shetensky, an actuary with the city's pension plan administrator, that the plaintiff retired from his employment with the police department in September, 2003, at which time he began to receive his pension of $6450.28 per month.[5] On the basis of the parties' testimony, the court found that the plaintiff was contemplating early retirement at the time of the dissolution proceedings. At the time of his retirement, the plaintiff had accrued vacation time of $13,562.44, holiday time of $33,353.55, compensatory time of $745.10 and a perfect attendance benefit of $1205.55 for a total of $48,866.64, according to Michael Matles, supervising payroll manager for the city of Hartford. The plaintiff also had accrued sick time benefits of $29,669.93, a portion of which he used to enhance his pension benefits. The accrued benefits were not included on the plaintiff's financial affidavit at the time of the dissolution of marriage. Sheldon Wishnick, a consulting actuary for Actuarial Litigation Services, testified that the value of the plaintiff's pension at the time of dissolution adjusted for coverture was $989,500. At the time of dissolution, the plaintiff had been married to the defendant for nineteen of the twenty-one years he had been a Hartford police officer.
Kaatz and Romeo made several attempts at completing the QDRO order. Romeo was adamant that the defendant was entitled to 50 percent of the plaintiff's pension. The court stated that the crux of the disagreement centered on the delay in benefits to be received by the defendant until 2022, the year the plaintiff becomes age sixty-five. According to Romeo, the court found, it was represented to him at the time of the dissolution negotiations that even if the plaintiff retired early, he could not receive his pension benefits until he becomes age sixty-five. In actuality, the plaintiff began to receive his pension benefits of $6450 per month as soon as he retired, but the defendant would not be able to receive benefits until the plaintiff becomes sixty-five in 2022. Kaatz, the plaintiff's counsel, acknowledged that some of the assumptions he made to calculate the plaintiff's pension in negotiating the agreement were incorrect, but he denied ever telling Romeo that the plaintiff could not retire until age sixty-five.
The court found that "a manifest injustice would occur if the defendant would not receive any pension benefits until the year 2022 while the plaintiff [already is receiving his pension benefits]. There were substantial mutual mistakes made in this case, and the judgment is opened." The court did not identify, however, the specific, substantial mutual mistakes made or what substantial means. Moreover, the court cited no law and provided *1101 no legal analysis in support of its conclusion that manifest injustice would occur if the defendant did not receive pension benefits until 2022. Neither party filed a motion for articulation of the court's memorandum of decision. See Practice Book § 66-5.
A judgment rendered on a stipulation of the parties is in the nature of a contract and may be opened by the court if the stipulation was entered into by mutual mistake. See Kenworthy v. Kenworthy, 180 Conn. 129, 131, 429 A.2d 837 (1980). "Whether there has been [a mutual] mistake is a question of fact." Inland Wetlands & Watercourses Agency v. Landmark Investment Group, Inc., 218 Conn. 703, 708, 590 A.2d 968 (1991). In this case, the court failed to identify the mistake or mistakes made. "Our role is not to guess at possibilities, but to review claims based on a complete factual record developed by a trial court.... Without the necessary factual and legal conclusions furnished by the trial court, either on its own or in response to a proper motion for articulation, any decision made by us ... would be entirely speculative.... [S]peculation and conjecture ... have no place in appellate review." (Citation omitted; internal quotation marks omitted.) Konefal v. Konefal, 107 Conn.App. 354, 360, 945 A.2d 484, cert. denied, 288 Conn. 902, 952 A.2d 810 (2008). "Accordingly, [w]hen the decision of the trial court does not make the factual predicate of its findings clear, we will, in the absence of a motion for articulation, assume that the trial court acted properly." Watrous v. Watrous, 108 Conn.App. 813, 835, 949 A.2d 557 (2008).
The judgment is affirmed.
NOTES
[1] The defendant cited no statute or rule of practice in her motion.
[2] The children have reached the age of majority.
[3] Counsel representing the parties testified at the hearing on the motion to open. The transcript provided to this court contains the testimony of the defendant's trial counsel, Frank J. Romeo III, but only a portion of the testimony of plaintiff's trial counsel, Leon M. Kaatz. The plaintiff did not provide a copy of the transcript of the defendant's direct examination of Kaatz. The plaintiff did provide a copy of his direct examination of Kaatz.
[4] Section twelve of the agreement stated: "Pensions. Plaintiff shall assign to Defendant, by way of a Qualified Domestic Relations Order (QDRO), a portion of his pension presently in place for him through his place of employment. Said QDRO shall call for the payment to Defendant of an amount equal to $1,483.00 per month (one half of benefit, adjusted for coverture) starting in September 2022 and continuing until Plaintiff's decease. The foregoing notwithstanding, if the provisions of Plaintiff's pension program will allow for said payments to continue to Defendant's decease, should Defendant outlive Plaintiff, then said QDRO shall be drafted to allow for said provision. Counsel for Plaintiff shall be responsible for the preparation of said QDRO. Except as already provided for in this paragraph, each Party shall keep and retain as his or her own property, free and clear of any claims from the other Party, any pension plans, IRA's, 401K plans, incentive savings plans, Keogh Plans, or the like, which said Party presently owns in his or her own name or which is maintained for the benefit of said Party. Nothing contained in this paragraph shall be construed as precluding Defendant from attempting to arrange a payment plan with the administrator of Plaintiff's pension, which payment plan will be the actuarial equivalent of what is called for hereinabove but which plan will call for Defendant to receive smaller monthly payments over a longer period of time, provided that said payment plan causes no deviation in what Plaintiff will receive as his pension if the QDRO provisions first set out in this paragraph are implemented."
[5] The plaintiff thereafter found employment in the security field, initially earning approximately $65,000 annually. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563746/ | 558 S.W.2d 131 (1977)
Joe T. HUDGINS, Appellant,
v.
Alphonse KRAWETZ et al., Appellees.
No. 15810.
Court of Civil Appeals of Texas, San Antonio.
November 16, 1977.
*132 W. James Kronzer, Kronzer, Abraham & Watkins, Houston, Thomas F. Webb, Webb, Stokes & Sparks, San Angelo, Rey Perez, Crystal City, for appellant.
Robert Lee Bobbitt, Brite, Drought, Bobbitt & Halter, Richard J. Karam, Nicholas & Barrera, Inc., San Antonio, W. E. Casey, Carrizo Springs, for appellees.
CADENA, Chief Justice.
Plaintiff, Joe T. Hudgins, appeals from an order of the district court of Zavala County sustaining the pleas of privilege of defendants, Alphonse Krawetz and wife, Jeune Krawetz, Elizabeth Krawetz Lang and husband, Carl D. Lang, and Al Perkins, and transferring plaintiff's suit to Bexar County, the domiciliary county of all defendants.
Plaintiff contends that the suit is maintainable in Zavala County under the provisions of Subdivision 14 of Article 1995, Tex. Rev.Civ.Stat.Ann. (1964), which requires that suits "for the recovery of lands .., or to quiet the title to land" be brought in the county in which the land is located.
Since it is undisputed in this case that the land involved in this litigation is situated in Zavala County, it is only necessary to determine whether the suit is one for the recovery of land or to quiet title to land, and this determination is to be made solely from the facts alleged in the plaintiff's petition, the rights asserted, and the relief sought. Scott v. Whittaker Pipeline Constructors, Inc., 517 S.W.2d 406 (Tex.Civ. App.Austin 1974, no writ).
Plaintiff's pleadings may be summarized as follows:
1. Gulf Energy and Development Company, identified in the remainder of this opinion as "Gulf," employed plaintiff for the purpose of obtaining title to the minerals underlying the Krawetz Ranch in Zavala County. The fee simple title to the ranch was in Mrs. Lang, subject to a vendor's lien held by her parents, Mr. and Mrs. Krawetz. In this opinion, the term "lessor" will be used to designate Mr. and Mrs. Krawetz and Mrs. Lang, while the term "lienholder" will be used to designate Mr. and Mrs. Krawetz.
2. Following negotiations resulting in an oral agreement, plaintiff prepared an oil and gas lease and an instrument subordinating the vendor's lease to the interest of the lessee. These instruments, accompanied by a draft on the Broadway National Bank of San Antonio (herein identified as "Broadway") in the sum of $56,295.00, representing the bonus payment, were delivered by plaintiff to lessor on September 17, 1975, after Gulf had secured an agreement by Broadway to honor the draft.
3. After Mrs. Lang had been informed by Broadway that the draft would be paid, the executed instruments were, in keeping with the agreement of the parties, delivered by lessor to Frost National Bank of San Antonio (hereinafter designated as "Frost") with instructions that they be transmitted to Broadway for processing according to the terms of the draft. The draft recited that, subject to approval of lease form and title, it was payable within 22 days after receipt of the instruments by Broadway "and within 22 days after receipt of complete abstracts of title supplemented to date and received by Joe T. Hudgins, whichever be the latter."
4. On September 22, 1975, Gulf deposited $100,000.00 with Broadway on which plaintiff *133 was authorized to draw drafts. Broadway received the lease, subordination agreement, and draft on September 23 or 24, 1975.
5. On September 24, 1975, lessor agreed to convey the minerals beneath the surface of the Krawetz Ranch to defendants, Carl Lang and Al Perkins, and instructed Frost to retrieve the instruments which had been transmitted to Broadway. The following day, in response to Frost's request, Broadway returned the instruments to Frost and Frost delivered them to lessor. On September 27, 1975, lessor executed an oil and gas lease in which Carl Lang and Perkins were named as lessees. Carl Lang and Perkins had notice of the prior dealings between lessor and plaintiff and of the prior delivery of the lease, subordination agreement, and draft to Frost and to Broadway.
Plaintiff's pleading also contained a count in trespass to try title, worded in the statutory form.
After alleging that he had acquired Gulf's interest, plaintiff sought judgment (1) awarding him title to, and possession of, the minerals; (2) declaring the vendor's lien subordinate to his interest as lessee; and (3) removing the cloud cast on his title by the September 27 lease to Carl Lang and Al Perkins.
The parties agree that plaintiff's suit may be classified as a suit for the recovery of land or to remove cloud from title in order to be maintainable in Zavala County under Subdivision 14, only if the facts alleged show that plaintiff held either legal or equitable title to the mineral estate.
Whether the facts alleged in the petition effected a transfer of some species of title depends on whether such facts constitute a delivery of the lease and subordination agreement.
In Barton v. Richardson, 47 S.W.2d 430 (Tex.Civ.App.Texarkana 1932, writ ref'd), the grantor, after executing the deeds, accepted a demand draft and delivered the deeds and draft to his bank with instructions to deliver the instruments to the bank in Tyler, through which the draft was to be collected, and with whom grantee had made arrangements for payment of the draft. Grantee had been to the bank on March 12 and 13, but was informed that the instruments had not arrived.
Meanwhile, on March 13 grantee advised his bank to instruct the Tyler bank to return the instruments. The instruments arrived at the Tyler bank on the morning of March 14, and grantee instructed an officer of the bank to pay the draft and charge it to grantee's account. At about noon of the 14th, while the officer with whom grantee had made arrangements for payment of the draft was out to lunch, a messenger from grantor's bank arrived at the Tyler bank and another officer, knowing nothing of the arrangements which had been made by grantee, returned the instruments, which were eventually delivered to grantor by his bank.
The Texarkana Court held that the transaction was completed and title passed to the grantee when the deeds, with the draft attached, were delivered by grantor to his bank, saying that the draft accepted by grantor was, in legal effect, a promissory note, payment of which could have been enforced by grantor.
The Barton holding was based on the decision in Pou v. Dominion Oil Co., 265 S.W. 886 (Tex.Com.App.1924). However, in both Barton and Pou the facts showed that after delivery of the deeds and draft nothing remained to be done, or approved, by the grantee. The draft was to be honored and paid immediately upon receipt of the deeds and draft by the grantee's bank.
Neither Barton nor Pou is controlling here, since in this case payment of the draft was not to take place until the title was approved by grantee. Neither of those two cases compels the conclusion that in this case the transaction was completed upon delivery of the instruments to Frost Bank so that, at that moment, legal title passed to plaintiff.
However, the facts alleged in plaintiff's petition establish all of the elements necessary to constitute what is usually *134 called a delivery in escrow or an escrow transaction. There was a delivery of the instrument of conveyance, without reservation of power to recall, to a third person (not merely as agent or custodian for lessor), with the intention that it be delivered to the lessee on the happening of a condition not specified in the instrument of conveyance. It is true that plaintiff's pleadings do not embody the term "escrow," but the legal consequences of facts do not depend on the descriptive terms used. See 1A Corbin, Contracts § 247 (1963).
Where a deed has been delivered as an escrow, a second delivery by the depositary to the grantee in the future is generally, if not always, contemplated, and in the usual case the second delivery is, in fact, made, although the rule is that a second delivery is not, in fact, required. 22 Tex. Jur.2d Escrow § 12 (1961).
The function of the escrow transaction is to give security to both parties to an existing transaction. The grantor desires to retain at least some property interest to be assured of performance by the grantee. The grantee desires security that if he performs or the condition occurs, the property will be his. The courts have recognized the escrow transaction as a means of subserving these desired functions. The result of judicial recognition of the escrow device is that the deposit of the instrument with the escrow agent creates new legal relations between grantor and grantee. Clearly, the grantee obtains an interest or right as the result of the initial deposit, it being clear that upon performance of the condition the courts will give immediate and full effect to the instrument of conveyance. The interest of the grantee prior to the fulfillment of the condition is, of course, something less than that complete ownership which is sometimes called "full title," and it would seem clear that his interest is something less than "legal title."
In Texas, this interest of the grantee named in a deed deposited in escrow has been held to be "equitable title." In Cowden v. Broderick & Calvert, 131 Tex. 434, 114 S.W.2d 1166, 1169 (1938), the Court said: "While legal title did not pass to the lessee until the conditions of the escrow agreement were satisfied, the lessee had, from the time the lease was placed in escrow... an equitable title to the leasehold estate or interest." In Neal v. Pickett, 280 S.W. 748, 750 (Tex.Com.App. 1926), it was said that an escrow has some effect from the beginning and originally vests equitable title in the grantee.
The parties here agree that the escrow agreement may rest in parol. See Johnson v. Freytag, 338 S.W.2d 257 (Tex. Civ.App.Beaumont 1960, writ ref'd n.r.e.). In the case before us the lease recites that it was executed on September 17, 1975. The term of the lease is stated to be "five years from this date." Lessee is required to commence drilling operations "on or before one year from this date." Clearly, it was the intention of the parties that, upon performance of the conditions, the lease should take effect from the date of the delivery to the bank. See Cowden, supra, 114 S.W.2d at 1169.
It may be true, as defendant points out, that the cases holding that delivery of a deed in escrow vests equitable title in the grantee from the date of such delivery are not venue cases. But the holdings that, from the date of the initial delivery, grantee has equitable title are clear and unequivocal, and it cannot be said that whether equitable title passes is dependent on whether or not a defendant files a plea of privilege. If, as the parties agree, equitable title is sufficient to support a plaintiff's action in trespass to try title or to remove cloud, the facts alleged in plaintiff's petition are sufficient to entitle him to maintain such actions and the suit is one for the recovery of land and to remove cloud. The rule is that the nature of the suit is to be determined by the plaintiff's pleadings. The pleas of privilege filed by defendants cannot be considered as part of plaintiff's pleadings and can have no effect in the process of determining the nature of plaintiff's suit.
Since plaintiff's pleading alleges facts which entitle him to recover the land and to *135 have the cloud removed from his title, and since the relief sought by plaintiff is recovery of title to and possession of the mineral estate and removal of such cloud, it is clear that venue of the suit is controlled by Subdivision 14 and is properly maintainable in Zavala County.
The judgment of the trial court sustaining the pleas of privilege of defendants is reversed and judgment is here rendered overruling such pleas of privilege. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563774/ | 16 So. 3d 269 (2009)
Edwin MURPHY, Appellant,
v.
STATE of Florida, Appellee.
No. 5D08-2603.
District Court of Appeal of Florida, Fifth District.
August 21, 2009.
James S. Purdy, Public Defender, and Leonard R. Ross, Assistant Public Defender, Daytona Beach, for Appellant.
Edwin Murphy, Malone, Pro Se.
Bill McCollum, Attorney General, Tallahassee, and Bonnie Jean Parrish, Assistant Attorney General, Daytona Beach, for Appellee.
ORFINGER, J.
In this Anders[1] appeal, Edwin Murphy's pro se brief raises one meritorious issue. Following a trial, Murphy was convicted of attempted sexual battery and lewd or lascivious molestation. At his sentencing hearing, Murphy sought dismissal of one of the two convictions on double jeopardy grounds. The trial judge, while conceding that a double jeopardy issue might exist, declined to rule on Murphy's motion. Instead, the court adjudicated Murphy guilty of lewd or lascivious molestation and sentenced him to prison, while taking no action on the attempted sexual battery charge. The State concedes this was error.
A trial court must adjudicate and sentence a defendant convicted of a crime, or in an appropriate case, adjudicate the defendant not guilty due to a lack of sufficient evidence to convict, double jeopardy, or any other legally sufficient reason. The trial court may not simply refuse to act. State v. Houghtailing, 704 So. 2d 163, 164 (Fla. 5th DCA 1997). Accordingly, we remand this matter to the trial court for the purpose of rendering an order with regard to the attempted sexual battery charge. If it is appropriate to adjudicate Murphy not guilty of that charge, it may do so. If not, it must adjudicate and sentence him for that crime.
REVERSED AND REMANDED.
COHEN, J., concurs.
GRIFFIN, J., concurs and concurs specially, with opinion.
GRIFFIN, J., concurring and concurring specially.
The trial court appeared to be uncertain about the double jeopardy issue in this case, which was understandable given the uncertain state of the law. Since this case was decided, however, the Florida Supreme Court issued its decision in State v. Meshell, 2 So. 3d 132 (Fla.2009), which may inform the trial court's decision on remand.
In this case, count one charged capital sexual battery, alleging that defendant's penis had union with the victim's vagina. Defendant was found guilty of attempted sexual battery, which means that defendant did some act in furtherance of the charged offense but failed to complete it. See § 777.04(1), Fla. Stat. (2008). Count three, which charged lewd or lascivious molestation of the same victim, alleged that defendant intentionally touched her genitals or the clothing covering her genitals. Unlike count one, count three did not *270 allege that defendant used his penis, but alleged a lewd touching.
NOTES
[1] Anders v. California, 386 U.S. 738, 87 S. Ct. 1396, 18 L. Ed. 2d 493 (1967). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563764/ | 960 A.2d 1215 (2008)
183 Md. App. 188
Tracy Wendell ADAMS
v.
STATE of Maryland.
No. 2292 September Term, 2006.
Court of Special Appeals of Maryland.
December 2, 2008.
*1216 George E. Burns, Jr. (Nancy S. Forster, Public Defender, on the brief), Baltimore, MD, for Appellant.
Brenda Gruss (Douglas F. Gansler, Atty. Gen., on the brief), Baltimore, MD, for Appellee.
*1217 Panel: HOLLANDER,[*] MARY ELLEN BARBERA,[**] and J. FREDERICK SHARER, JJ.
J. FREDERICK SHARER, Judge.
Tracy Wendell Adams was convicted of possession of cocaine and distribution of cocaine by a jury in the Circuit Court for Wicomico County. He was sentenced to a term of 20 years incarceration.
Appellant presents three questions on appeal:
I. Did the trial court err in altering the order of calling jurors?
II. Did the trial court err in refusing the jury's request to review the tape of the alleged transaction?
III. Did the trial court err in granting the State's motion to quash a defense subpoena?
For the following reasons, we shall affirm.
FACTS
At approximately 5:15 p.m. on September 21, 2005, Salisbury Police Officer Howard Drewer was working undercover, targeting drug sellers. He was alone in an unmarked van equipped with a camera that recorded from the driver's side window. The vehicle was also equipped with an audio device located atop the driver's side sun visor. As Drewer approached a residence at 671 West Main Street, he saw "numerous individuals standing in the front yard," and Drewer was waved down by a black male. Drewer leaned out the van's window and, in response to the man's question, responded that he wanted to buy "a 20," meaning $20 worth of crack cocaine. The man told Drewer to drive around the block and return; he did so, returning in approximately 30 to 45 seconds. When he arrived again at the location, a different black male approached the passenger side door and "pulled out a piece of crack cocaine." Drewer told the man to go to the driver's side, but the man opened the passenger door instead. After Drewer repeated that he wanted to buy "a 20," the man bit off a portion of a piece of crack cocaine and gave it to Drewer. Drewer gave the man $20 in return.
After Drewer drove away, he transmitted a description of the man who sold him the cocaine, and the clothing the man was wearing, to officers in a nearby vehicle, and told them the location where the exchange had taken place. At trial, Drewer testified that his description was of a "black male wearing a white tank top shirt, a black baseball cap which he was wearing backward, blue jean shorts and a small or light beard." Drewer testified that he had not seen anyone else in front of the residence at 671 West Main Street similarly dressed.
Drewer was questioned about his handling and processing of the contraband. He described his normal procedure for maintaining purchased contraband:
Once I obtain it, I have envelopes, small manila envelopes that I place the crack cocaine into that bag. I write on the envelope the location, the time, and a description of the suspect for purpose of my notes so at a later point when we actually type it into the computer I'll have a set of notes referring back to where it had taken place.
*1218 Drewer testified that, following his usual procedure, he packaged the crack cocaine into a small envelope that he placed into a larger manila envelope. He folded over the flap on the larger manila envelope and placed it in the pocket of the van door. Drewer further stated that the envelope "is normally stapled into the inside of my manila folder however, it was turned in as evidence already." After packaging the cocaine, Drewer drove to a predetermined area to review the video/audio tape.
Within an hour and a half after he left West Main Street, Drewer viewed photographs at a police office in Salisbury, in the presence of Corporal Yankalunas and Officer Ehrisman.[1] The photographs were laid out side by side on a table before Drewer entered the room. After carefully observing the photographs, Drewer selected a photo, which he "immediately recognized to be the suspect that had sold crack cocaine to [him] in front of 671 West Main Street." Drewer told Yankalunas that the person in that photograph had sold him the cocaine, and initialed and dated the space below the photograph. The photograph, bearing Drewer's initials and date, was admitted into evidence.
Drewer made an in-court identification of appellant as the person whose photograph he had selected and, in addition, identified appellant as the man who sold him the crack cocaine on West Main Street. Drewer testified that he had "a face to face" view of the seller as he approached the vehicle, a side view as he walked around the vehicle, and again a "face to face" view when he opened the door of the van. Drewer explained that although the videotape captured the conversation, the camera did not record the transaction because appellant was on the passenger side of the vehicle, away from the camera. However, the State admitted the tape into evidence and played it for the jury.
On cross-examination, Drewer confirmed that he did not seal the smaller envelope. Defense counsel elicited that Drewer had not recorded the seller's height, weight, build, age, hair or complexion. Drewer further testified that he did not recall whether he had testified the previous Friday[2] that he had driven around the block before buying the crack cocaine. Defense counsel further elicited that Drewer had made more than one or two drug purchases a day, on a daily basis, during the time in question.
Drewer testified that he wrote out the property sheet at 10:30 on the night of the transaction, and that he then knew appellant's name. He admitted that he wrote the wrong dateSeptember 23, not September 21. On redirect, Drewer conceded that it looked like the date had been changed, but that the incorrect date was a "handwriting mistake" on his part. Drewer explained that he would have sealed the cocaine in a ziplock baggie on the date he seized it. He also testified that the chain of custody sheet attached to the front of the sealed bag bore the date "9-21-05" and that it was placed there when the drugs were put into the bag.
Officer Edward Fissel was one of the officers receiving a description over the radio from Drewer, while in the area of West Main Street and Delaware Avenue. The description was of "a black male wearing a white tank top shirt, blue jean shorts, black baseball hat with light beard, light facial hair last seen in the area of West *1219 Main and Delaware Avenue." Fissel, in uniform and driving a marked police vehicle, arrived at that intersection about three minutes after he received the description, where he saw a black male matching that description. Fissel stopped the man who, at his request, approached and answered his questions. The man told the officer his name was Tracy Wendell Adams. At trial, Fissel identified appellant as the person whom he stopped that day.
Catherine Savage, a Maryland State Police lab forensic scientist, testified that she received the heat-sealed package submitted by the Salisbury Police Department. Upon analysis, she determined that it was cocaine with a net weight of .1 grams.
Additional facts will be set out as needed in our resolution of the questions presented.
DISCUSSION
I.Jury Selection
Appellant complains that the trial court erred in the jury selection process by not starting the calling of the venire from juror number one. After excusing several of the venire for cause, the court began seating the jury. The following occurred:
THE COURT: We'll start with number seven, Carl Cottingham.
[PROSECUTOR]: Acceptable to the State, Your Honor.
[DEFENSE COUNSEL]: Please seat Mr. Cottingham.
THE COURT: Take seat number one, please.
THE CLERK: Joann Darling.
[DEFENSE COUNSEL]: Please seat Ms. Darling.
[PROSECUTOR]: Acceptable to the State, Your Honor.
THE COURT: Number two.
THE CLERK: Paula Davis.
[PROSECUTOR]: Acceptable to the State, Your Honor.
[DEFENSE COUNSEL]: Your Honor, may we approach?
THE COURT: Yes.
(Whereupon, counsel and the Defendant approached the bench and the following occurred at the bench:)
[DEFENSE COUNSEL]: Your Honor, I noticed that you started with number seven, and number six, Reverend Copeland, and my client, if we don't get back to him, my client would like to have an opportunity to have him on the jury.
THE COURT: Well, sorry. Thank you.
After twelve jurors were seated, defense counsel said, "We're satisfied, Your Honor."
The Rule
Maryland Rule 4-312, as operative at the time of appellant's trial, provided, in pertinent part:
(g) Designation of List of Qualified Jurors. Before the exercise of peremptory challenges, the court shall designate from the jury list those jurors who have qualified after examination. The number designated shall be sufficient to provide the number of jurors and alternates to be sworn after allowing for the exercise of peremptory challenges pursuant to Rule 4-313. The court shall at the same time prescribe the order to be followed in selecting the jurors and alternate jurors from the list.
(h) Impanelling the Jury. The jurors and any alternates to be impanelled shall be called from the qualified jurors remaining on the list in the order previously designated by the court and shall be sworn. The court shall designate a juror as foreman.
*1220 Nothing in the rule requires the trial court to begin the selection of jurors in any particular manner.
Appellant relies on Spencer v. State, 20 Md.App. 201, 314 A.2d 727 (1974), in support of his view that the trial court committed reversible error. In Spencer, 50 potential jurors, the remaining jurors of three distinct panels, were brought into the courtroom at the same time. When Spencer and the prosecution began to exercise peremptory challenges, they first excused potential jurors from one panel. At that point, the State had used three of its ten peremptory challenges and the defense had used ten of its 20 peremptory challenges. The clerk had called the jurors "in regular order reading from the top of the list to the bottom." Id. at 205, 314 A.2d 727.
The clerk then called names from the second panel, again calling the names in order from the top of the list to the bottom. Id. at 205-06, 314 A.2d 727. When that list was exhausted, the State had used all its peremptory challenges and Spencer had three remaining. Id. at 206, 314 A.2d 727.
The Spencer Court described the defendant's situation:
The tactical prospect then facing [Spencer] was this: He had three peremptory challenges remaining and the State had none. Seat no. 5 in the jury was vacant. The last list of 13 available names was sitting before him. He knew (or thought he knew) the order in which those 13 persons would be called. By exercising or not exercising some or all of his remaining peremptories, the appellant was in a position to select (by not rejecting) any of the next four names on the list to fill seat no. 5. He chose to go for the fourth name on the list. Accordingly, when the first three names on the list were called (and they were called in predictable order), [Spencer] exhausted his 18th, 19th and 20th peremptory challenges.
Id. at 206-07, 314 A.2d 727
At that point, after the first two panels were exhausted, neither party had a peremptory challenge remaining. Then,
[w]ith no explanation or warning, the clerk suddenly departed from the standard operating procedure and jumped over the next three names on the list, calling the name of the fourth person down the line to fill seat no. 5.
Id. at 207, 314 A.2d 727.
Defense counsel immediately complained that he had exercised his peremptory challenges in the expectation that the clerk would continue the customary manner and order of calling names. Counsel asserted that "the Court in all its fairness and justness should instruct the clerk to call the next prospective juror in line." Id. at 207, 314 A.2d 727. The trial court overruled the objection. Spencer was convicted and claimed on appeal that the clerk's deviation impaired his right to use his peremptory challenges. This Court agreed:
Under the peculiar circumstances of the case at bar, we see a violation of the due process of law to which the appellant was entitled by the arbitrary and capricious action of the court clerk. We do not establish any ironclad ritual to govern the calling of prospective jurors. We simply hold, under the facts of this case, that where the rules have been agreed upon, either explicitly or implicitly through settled usage, a defendant is entitled to rely upon those rules, unless good cause necessitates some departure therefrom.
Although the peremptory challenge, to be sure, only entitles a defendant to reject jurors and not to select others, *1221 there is at least some element of indirect selection inexorably at work in the very process of elimination. The right to reject need not be exercised in the dark, but is, under circumstances such as those here available, a right of informed and comparative rejection. When the appellant determined to spend his last three peremptories to challenge the first three of the next four persons whom he rightfully expected to be called, he was deciding that he liked the first three less than he liked the fourth. Had he known that he was comparing the three persons challenged with some other fourth person further down the list, he might well have preferred one, or more, of the rejected threesome to the unanticipated fourth. He was thus affirmatively misled in his three decisions to reject.
We hold that the arbitrary and unexplained action of the clerk in this case impaired the right of the appellant to the use of his peremptory challenges, free from manipulative countermeasures.
Id. at 208, 314 A.2d 727.
In Booze v. State, 347 Md. 51, 698 A.2d 1087 (1997), in the context of a comparative rejection case, the Court of Appeals reviewed the history of jury selection in Maryland. The Court explained that the early view of peremptory challenges, "[b]ased largely on English precedent, the views of Justice Story announced in U.S. v. Marchant, 25 U.S. 480, 12 Wheat. 480, 6 L. Ed. 700 (1827), and practice in Maryland and in other American States," was that "the defendant's right of peremptory challenge is `not a right to select the jurors, but simply to reject such as he may consider objectionable.'" Booze, supra, 347 Md. at 62, 698 A.2d 1087 (citing Turpin v. State, 55 Md. 462 (1881), superseded by statute as stated in Brown v. State, 359 Md. 180, 753 A.2d 84 (2000)). The Booze Court explained that the 1984 revisions to the rule regarding jury selection
communicate clearly this Court's intent that, to the extent possible, the parties should have before them the entire pool of prospective jurors before being required to exercise any of their peremptory challenges. That intent is not, in any sense, inconsistent with the basic notion that the function of peremptory challenges is to reject rather than to select jurors. It simply manifests the belief that the parties should have the right to exercise their rejections intelligently and strategically, and that they can better do that if they have the full panel of prospective jurors before them. This is not necessarily a matter of due process. By adopting Rule 4-312(g), we have made that intent a mandate of State judicial policy, and, in the absence of a waiver or other compelling circumstance, we insist that it be followed. In this case, it was not followed, and there was neither a waiver nor any justification for the deviation.
Id. at 69, 698 A.2d 1087.
The present case is different from Spencer and Booze in a significant way. In the present case, the trial court stated the order that the jurors would be selected before the parties had used any peremptory challenges. The court announced the rules at the outset; it did not change the rules as the game proceeded. Unlike Spencer and Booze, appellant was able to consider the entire venire before exercising his challenges. Indeed, the Spencer Court rejected the opportunity to establish "any ironclad ritual to govern the calling of prospective jurors." Spencer, supra, 20 Md.App. at 208, 314 A.2d 727. Appellant argued to the trial court that, by not starting the calling of the venire from number one, he was deprived of the possibility of having Reverend Copeland as a juror. *1222 But, as we have seen, a defendant's right to exercise peremptory challenges is reserved for the opportunity to reject a prospective juror whom he or she does not want. It is not the right to select a particular potential juror.
Pollitt v. State, 344 Md. 318, 686 A.2d 629 (1996), is likewise not helpful to appellant. In Pollitt's trial, immediately after the jury was seated and sworn, the trial court excused one juror when it discovered that she had difficulty hearing. The parties agreed that the court would select a replacement from the remaining venirepersons, who were still in the courtroom. Defense counsel, however, contended that the replacement juror was an alternate, claimed the right to an additional peremptory challenge. The trial court denied the request for an additional challenge.
The Court of Appeals reversed Pollitt's conviction because "defense counsel's consent to the impanelling of the next person on the jury list was based on the reasonable belief that he would receive another peremptory challenge and the court would not grant one, there was, in effect, no consent at all." Id. at 326, 686 A.2d 629. That scenario, of course, is inapposite to the facts before us; here, appellant complains of a ruling that was made before the jury was seated and sworn.
It is fundamental that the action of the trial court is presumed to have been correct. The burden of rebutting that presumption is on the party claiming error, first, to allege error, and then to persuade us that an error occurred. State v. Chaney, 375 Md. 168, 183-84, 825 A.2d 452 (2003) (citing Fisher v. State, 128 Md.App. 79, 104-05, 736 A.2d 1125 (1999)). "[E]rror is never presumed by a reviewing court, and we shall not draw negative inferences from this silent record." Chaney, supra, 375 Md. at 184, 825 A.2d 452.
In the present case, appellant did not object to the order in which jurors were seated, but stated only that he wanted juror number six on his panel. He does not allege in this Court that it was unusual or irregular for the trial judge to have started at a juror other than juror number one;[3] he does not allege that the jury ultimately selected was in any way improper; nor did he allege that the trial court acted with the intent of preventing juror number six from serving on the panel. Absent any allegation that the trial court had a discriminatory or improper reason for starting the selection as it did, or that any prejudice resulted from that procedure, we see no abuse of discretion.
Finally, we point out that after the jury was selected counsel agreed, saying "[w]e're satisfied, your Honor." "We have repeatedly held that a claim of error in the inclusion or exclusion of a prospective juror is ordinarily abandoned when the defendant or his counsel indicates satisfaction with the jury at the conclusion of the jury selection process." Mills v. State, 310 Md. 33, 527 A.2d 3 (1987).
II.Jurors' Request to View the Videotape
Later, during their deliberations, the jury sent a note requesting to see the videotape that had been admitted as Exhibit *1223 2.[4]
The following occurred:
THE COURT: Mr. [Bailiff], you say you have a note.
[THE BAILIFF]: They want to see the video.
THE COURT: No.
[DEFENSE COUNSEL]: No?
THE COURT: No.
[DEFENSE COUNSEL]: Your Honor, if the video is part of the evidence
THE COURT: That's right.
[DEFENSE COUNSEL]: You didn't want to let them look at it again?
THE COURT: You want them to take all the witnesses in there and hear from them again? What's the difference?
* * *
Tell them they will have to recall or you can bring them in and I'll tell them.
[THE BAILIFF]: Bring them out?
[DEFENSE COUNSEL]: Your Honor, that's like saying you can't look at a document again. It's been admitted.
THE COURT: It's singling out testimony, [Ms. Defense Counsel].
(Whereupon the jury returned to the courtroom.)
THE COURT: [Mr. Foreman], what was the question?
[JUROR]: If we could view the tape again?
THE COURT: You'll just have to recall
[JUROR]: Okay.
THE COURT:what you saw.
[JUROR]: Okay, that's fine.
THE COURT: I can't single out any testimony. Then I'd have to let each witness come in.
[JUROR]: Oh, I see. Okay.
* * *
THE COURT: You can except to that, if anybody wants to.
[DEFENSE COUNSEL]: Your Honor, I think we both made reference to the video.
THE COURT: I understand you did.
Yes, ma'am. Okay.
Take an exception then.
[DEFENSE COUNSEL]: Thank you, Your Honor.
Appellant now contends that the trial court erred in not permitting the jury to review the tape.[5] He contends that
[n]o good cause was found for not letting the jury have the tape; thus, its subsequent request to review the tape was no different from a request to examine any other exhibit. The exhibit was not testimony and therefore the trial court erred in treating it as testimony.
Appellant further states: "In relying on an incorrect rule, the court necessarily exercised no discretion."
The State responds that the conduct of a criminal trial, including decisions relevant to the appropriateness of responses to questions by the jurors during their deliberations, is committed to the sound discretion of the trial court.
Maryland Rule 4-326 provides, in pertinent part:
*1224 (b) Items Taken to Jury Room. Sworn jurors may take their notes with them when they retire for deliberation. Unless the court for good cause orders otherwise, the jury may also take the charging document and exhibits that have been admitted in evidence, except that a deposition may not be taken into the jury room without the agreement of all parties and the consent of the court. Electronically recorded instructions or oral instructions reduced to writing may be taken into the jury room only with the permission of the court. On request of a party or on the court's own initiative, the charging documents shall reflect only those charges on which the jury is to deliberate. The court may impose safeguards for the preservation of the exhibits and the safety of the jury.
(c) Jury Request to Review Evidence. The court, after notice to the parties, may make available to the jury testimony or other evidence requested by it. In order that undue prominence not be given to the evidence requested, the court may also make available additional evidence relating to the same factual issue.
This Court discussed the discretionary nature of items taken into the jury room in Jackson v. State, 164 Md.App. 679, 884 A.2d 694 (2005). In that case, the jury asked to hear the testimony of a witness again. The trial court refused the request because the court reporter would have had to transcribe the testimony, which the trial court believed would take too long. Jackson claimed that the trial court "had `the discretion to have the court reporter read [the] requested trial testimony to the jury.'" Id. at 725, 884 A.2d 694 (citing Veney v. State, 251 Md. 159, 173, 246 A.2d 608 (1968)). The Jackson Court iterated the discretionary nature of the trial court's decision not to allow the jury to hear the witness's testimony again, and the deference to which the trial court's determination is entitled:
Appellate courts are highly deferential to a trial judge's discretionary determinations. Even in cases in which the appellate court might have deemed it wiser or fairer to have ruled otherwise, it will not presume to substitute its judgment for that of the trial court except in the rare case in which the trial judge has literally abused his discretion. To rule differently than the appellate court might have ruled is not, ipso facto, such abuse.
Jackson, supra, 164 Md.App. at 725-26, 884 A.2d 694.
The question presented here is similar to that in Wright v. State, 72 Md.App. 215, 528 A.2d 498 (1987), in which the trial court had refused to permit a videotape to be taken into the jury room during deliberations. The tape in that case showed "several different line-up sessions," of which one session was pertinent to Wright's case. Id. at 218, 528 A.2d 498. The trial court reasoned that "to allow the jury to view the tape again and again would unduly emphasize that evidence." Id. This Court perceived no error:
[Wright] relies on the provision in Md. Rule 4-326(a) (which says, among other things) that "[U]nless the court for good cause shown orders otherwise, the jury may also take ... exhibits which have been admitted into evidence ..." into the jury room. As we see it, the "good cause" mentioned in that rule encompasses the reasons articulated by the trial court. We are not persuaded that the trial court was clearly wrong.
Id.
What constitutes "good cause" is a matter entrusted to the discretion of the trial court. See State v. Price, 385 Md. 261, 276-77, 868 A.2d 252 (2005) (dealing with good cause for a postponement of *1225 trial); State v. Brown, 355 Md. 89, 98, 733 A.2d 1044 (1999)(same); Johnson v. State, 348 Md. 337, 345-56, 703 A.2d 1267 (1998) (whether to permit filing of a belated insanity plea). "The trial judge's determination is entitled to the utmost respect and should not be overturned unless there was a clear abuse of that discretion." Johnson, supra, 348 Md. at 346, 703 A.2d 1267 (quoting Grandison v. State, 305 Md. 685, 711, 506 A.2d 580 (1986)) (citing Madore v. Baltimore County, 34 Md.App. 340, 346, 367 A.2d 54 (1976)). See also State v. Frazier, 298 Md. 422, 451, 470 A.2d 1269 (1984)(trial court's discretionary determination will not be set aside on appeal unless the exercise of discretion was arbitrary).
In the instant case, the trial court made a discretionary determination that allowing the jury to have the videotape of the alleged incident would overemphasize it. As in Wright, we are not persuaded that the trial court abused its discretion in making that determination.
Morris v. State, 59 Md.App. 659, 477 A.2d 1206 (1984), does not persuade us otherwise. The trial court refused a jury request to hear a tape recording because the tape had not been admitted into evidence. Defense counsel had requested that the recording be admitted, but the State objected, giving assurance that it would seek to admit it during the testimony of its next witness. Id. at 673-74, 477 A.2d 1206. But, the tape was never admitted as an exhibit. In their closing arguments, both defense counsel and the State referred to the recording, and argued its significance. The court declined to give the tape to the jury, because it had not been admitted. Id. at 674-75, 679-80, 477 A.2d 1206. On appeal, this Court stated that "based on the use of the tape made both during the trial and the closing arguments it was de facto already admitted into evidence." Id. at 679-80, 477 A.2d 1206.
Here, the trial court articulated an acceptable reason for refusing the jury's request. We perceive no abuse of discretion.
III.Motion to Quash
Before trial, defense counsel issued a subpoena duces tecum to Officer Drewer, requiring him to personally appear at appellant's trial and produce:
Records of all drug or non-CDS transactions on 9/21/05 made by you between the beginning of your undercover assignment on that date until your shift ended, including narratives and drug transmittal sheets to the lab for chemical analysis, envelopes used to temporarily transport the suspected drugs to the station before they were sealed. Any videotape of the alleged transaction in this case.
The State moved to quash alleging, inter alia, that "any such documents in the custody of the Salisbury City Police Department are not discoverable under the Maryland Rules and compliance with the Writ of Subpoena would circumvent the Rules of Procedure"; that "Officer [Howard Drewer] is not the proper person designated by the Salisbury City Police Department to maintain their records and reports"; and that "Compliance with this Writ of Subpoena would impose annoyance, oppression and undue burden on Officer [Howard Drewer]."
The trial court convened a hearing on the State's Motion to Quash, at which appellant's counsel argued that she needed the information to effectively cross-examine Drewer. Counsel proffered a transcript of a prior trial, involving a different defendant, in which Drewer had testified that he did not seal the little envelopes in which he placed the suspected drugs before putting them into the bigger envelope. *1226 Based on that information, defense counsel argued that there was a "potential for chain of custody problems, even problems that something that was a drug from one person might get into another envelope or the wrong person's name may end up on a transmittal sheet for drugs that really were somebody else's."
In response to the trial court's question, defense counsel pointed out that she was entitled to the officer's notes before she cross-examined him, and that she thought "the Court would rather have him turn those notes over prior to a trial than to have a jury trial stopped for him to provide [her] with documents for [her] to go out and spend however long it takes to do an adequate job to be able to develop cross-examination." Defense counsel also pointed out that "officers' notes are discoverable through Brady."[6]
The State argued that the information was irrelevant to appellant's case, that complying with the subpoena would be burdensome for the State, and that Drewer was not the appropriate person from whom to subpoena the records. The State acknowledged that, for the day in question, there was only one other "bust," but conceded that in other cases there could be many more.
The trial court granted in part, and denied in part, the State's Motion to Quash, stating:
Well, I'm not sure you have case law authority supporting your position Ms. [Defense Counsel], as far as the officer's notes pertaining to other transactions involving other possible suspects or Defendants, unless you can cite me a case.
In this appeal, appellant asserts that "in a fast moving, surreptitious transaction[, the] chance of misidentifying the seller or the drugs is substantial," and that the trial court's refusal to allow him the information he sought was error.
The State counters that the records were not relevant to appellant's misidentification defense. It also asserts that "[p]roduction of these records was also potentially burdensome for the State." It asserts that the information is not discoverable under Md. Rule 4-263, and that appellant has not claimed that the evidence was exculpatory Brady material.
Finally, the State asserts that any error was harmless.
Standard of Review
"Discovery questions generally `involve a very broad discretion that is to be exercised by the trial courts. Their determinations will be disturbed on appellate review only if there is an abuse of discretion.'" Cole v. State, 378 Md. 42, 55, 835 A.2d 600 (2003) (citation omitted). "The application of the Maryland Rules, however, to a particular situation is a question of law, and `we exercise independent de novo review to determine whether a discovery violation occurred.'" Id. at 56, 835 A.2d 600 (citation omitted).
Discovery Rules
Maryland Rule 4-263 governs pre-trial discovery in circuit court. Aside from exculpatory information, the State must disclose: (1) the names and address of each witness then known whom the State intends to call to prove its case-in-chief or to rebut alibi testimony; (2) statements of the defendant to a State agent that the State intends to use; (3) statements of co-defendants made to State agents that the State intends to use; (4) reports or statements of experts consulted by the State.
*1227 In addition, the State must make available for the defendant to inspect, copy, and photograph (1) any documents, computer-generated evidence, recordings or other tangible things that the State intends to use at a hearing or trial; and (2) any item obtained from, or belonging to, the defendant whether or not the State intends to use it at the hearing or trial. Md. Rule 4-263(b). At trial, however, defense counsel is entitled to see notes or reports of a State's witness in order to assist counsel in cross-examining the witness. Carr v. State, 284 Md. 455, 472-73, 397 A.2d 606 (1979); Massey v. State, 173 Md.App. 94, 115, 917 A.2d 1175 (2007); Leonard v. State, 46 Md.App. 631, 638, 421 A.2d 85 (1980).
In Massey, this Court pointed out the need for such statements at trial:
When confronted with the actual testimony of a critical witness and the knowledge that the witness has given a prior statement bearing on a material issue in the case, counsel is not engaged in a mere "fishing expedition" in seeking access to the prior statement. At that point, it becomes more than a matter of casting a seine over the State's files to see what turns up, but of directly confronting the witness; and the statement thus assumes a specific importance and relevance beyond its general value for trial preparation.
Massey, 173 Md.App. at 115, 917 A.2d 1175.
Both the State and the trial court apparently believed that because the information sought by the subpoena involved other cases, it was not relevant.
The word "relevance" has a different meaning in the discovery context from its meaning in the trial context. The issue at trial is admissibility of offered evidence, while the issue in pre-trial stages is whether a party may obtain information or documents through discovery. This distinction is made clearest in the civil setting. "A party may obtain discovery regarding any matter, not privileged, ... if the matter sought is relevant to the subject matter involved in the action." Rule 2-402(a). A party may not object to a discovery request on the ground that "the information will be inadmissible at the trial if the information sought appears reasonably calculated to lead to the discovery of admissible evidence."
Cole v. State, 378 Md. 42, 61, 835 A.2d 600 (2003) (quoting Md. Rule 2-402(a)) (internal footnote omitted).
Information is not irrelevant solely because it involves other cases. Blades v. Woods, 107 Md.App. 178, 183-84, 667 A.2d 917 (1995). Further, "[g]eneral allegations of overbreadth, vagueness, and burden, however, are not sufficient to defeat the requesting party's motion to compel. The complaining party should demonstrate, e.g. through an affidavit, why furnishing a particular answer would be burdensome." Id.
Here, defense counsel asked for the records in the hope of obtaining information with which to cross-examine Drewer regarding his handling of the various pieces of contraband he might have seized during his shift on that date, and whether it affected the substance the officer allegedly bought from appellant.
That said, however, and whether the information could or should have been disclosed by the State in discovery, appellant has not told us how he was prejudiced by the trial court's refusal to allow defense counsel the information she sought. Although the notes and records sought by the subpoena were not provided, defense counsel was not in any fashion encumbered in her cross-examination of Drewer. She *1228 elicited from Drewer at trial that he put the suspected drugs into a small manila envelope, "maybe an inch and a half by three" and that he closed the flaps of the envelopes, but did not seal them.
Defense counsel was permitted to ask Drewer whether he had any suspected substances in other small envelopes inside the larger envelope. Drewer reported that he made one other buy on that date, although he did not recall whether he made a purchase prior to, or after, his purchase from appellant. In addition, Drewer testified about how he maintained the substances he seized, and the chain of custody of the items. He also testified about the description he gave to the officers who detained appellant, and conceded that he had not recorded the seller's height, weight, build, age, hair color, or complexion.
Defense counsel explained at the hearing that she wanted the information to be able to cross-examine Drewer without taking a lot of time to review the information. Appellant has not identified anything that defense counsel was not able to ask, nor has he alleged that the trial court refused to give defense counsel sufficient time at trial to review the information. Without determining whether the trial court abused its discretion in quashing the subpoena, we conclude that appellant suffered no prejudice from not having the information before trial.
JUDGMENTS OF THE CIRCUIT COURT FOR WICOMICO COUNTY AFFIRMED; COSTS ASSESSED TO APPELLANT.
NOTES
[*] Barbera, Mary Ellen, now a member of the Court of Appeals, participated in the hearing and conference of this case while an active member of this Court; and in the adoption of this opinion as a specially assigned member of this Court.
[**] Sharer, J. Frederick, participated in the hearing and conference of this case while an active member of this Court; he participated in the adoption of this opinion as a retired, specially assigned member of this Court.
[1] The record does not disclose the first names of Corporal Yankalunas and Officer Ehrisman.
[2] Presumably, at the pre-trial suppression hearing.
[3] In those jurisdictions where the jury term continues for a number of weeks or months, and the same venire is returned time after time, it is not uncommon for the court to vary the beginning point of the calling of jurors for selection. To always begin at number one would result in the same jurors being seated frequently, to the probable exception of those at the end of the list. We find no prohibition of that practice, either in Rule 4-312 or case law.
[4] We recall Drewer's testimony that the transaction was not captured on videotape because appellant did not approach the driver's side of the van, where the camera was mounted. We assume, therefore, that it was the audio portion of the tape that was played for the jury, and which the jury asked for during deliberations.
[5] Defense counsel did not articulate a precise exception to the court's denial of the jury's request. However, the colloquy indicated that counsel did wish the tape to be provided.
[6] Brady v. Maryland, 373 U.S. 83, 87, 83 S. Ct. 1194, 10 L. Ed. 2d 215 (1963). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563847/ | 16 So. 3d 832 (2009)
WALKER
v.
STATE.
No. 5D08-861.
District Court of Appeal of Florida, Fifth District.
August 18, 2009.
Decision without published opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563859/ | 155 F.2d 445 (1946)
MANNSZ
v.
MACWHYTE CO. et al. ELLIS
v.
SAME.
Nos. 8999, 9000.
Circuit Court of Appeals, Third Circuit.
Argued January 22, 1946.
Decided May 8, 1946.
*446 *447 James J. Burns, Jr., of Pittsburgh, Pa., for appellants.
Mahlon E. Lewis, of Pittsburgh, Pa. (William J. Kenney and Stewart & Lewis, all of Pittsburgh, Pa., on the brief), for appellee.
Before BIGGS, MARIS and GOODRICH, Circuit Judges.
BIGGS, Circuit Judge.
The plaintiff, Dorothy King Mannsz, a citizen of Pennsylvania, the widow of Donald King, brought suit in the Court of Common Pleas of Allegheny County, Pennsylvania, against Macwhyte Company (Macwhyte), an Illinois corporation, and against Bradford Supply Company (Bradford), a Pennsylvania corporation. Donald King purchased from Bradford at Warren, Pennsylvania, a wire rope, described hereinafter, used by him to support a scaffold on which he and Myron R. Ellis worked. The rope broke, causing one end of the scaffold to fall to the ground. King was killed; Ellis was injured. Mrs. Mannsz' suit was removed to the court below pursuant to Section 28 of the Judicial Code, 28 U.S.C.A. § 71. The court below, ruling that Mrs. Mannsz' cause of action against Macwhyte was separate and distinct from her cause of action against Bradford, remanded her action against Bradford to the Court of Common Pleas of Allegheny County. Ellis sued Bradford and Macwhyte in the court below in a single suit. It appears that a motion, made by Bradford to dismiss Ellis's action as to it because of lack of diversity, was granted.[1]
Before answer Macwhyte filed a motion to dismiss the Mannsz suit on the ground that the complaint did not set forth a cause of action. The motion was denied[2] by the court below on the authority of Sierocinski v. E. I. DuPont De Nemours & Co., 3 Cir., 118 F.2d 531. Both cases were then brought on for trial. It was stipulated that the Ellis proceeding should be treated as if a like motion had been made by Macwhyte and had been disposed of as had *448 Macwhyte's motion in the Mannsz case. Both cases were then tried together.[3] At the close of the plaintiffs' evidence the court below granted motions made by Macwhyte for directed verdicts. The plaintiffs moved for new trials. The motion was denied. See D.C., 60 F. Supp. 76. Both plaintiffs have appealed.
The complaints in both cases assert breach of warranty and negligence by Macwhyte, charging it with improperly manufacturing the rope, with not having inspected it properly, and with having negligently represented it as fit for the purpose for which it was used. In its answer Macwhyte denied that the rope was not properly manufactured or adequately inspected and asserted that it was not used by King for the purpose for which it was manufactured.
The evidence shows the following, taking those inferences therefrom most favorable to the plaintiffs. King used the wire rope to suspend a scaffold upon which he and Ellis were working. Specifically, the wire rope, 16 feet in length and cut into two pieces of about equal length, was employed by King to hang from a channel iron blocks, pulleys and hooks which, in turn supported other ropes connected to the scaffold.
The evidence showed that the two pieces of wire rope were clamped into closed loops and from each of these loops was hung a block connected by tackle with another block, from which in turn the scaffold was suspended. The wire rope in turn was fastened around a channel iron at the top of the building from which the whole scaffold and its accouterments were hung. The channel iron had an edge which, though not sharp in any literal sense, none the less might cut by abrasion a wire rope of the sort employed by King.
There was uncontradicted evidence that the wire rope had been "moved" two or three times; that is to say, had been fastened or unfastened several times as the scaffold had been moved from building to building. There was also testimony that the scaffold might have swung a little as the men moved upon it. The left hand section of the wire rope broke. If it were proven that the break occurred at some point around the channel iron, the plaintiffs probably could not recover for it might then be assumed that the rope had been cut by abrasion. The evidence, however, shows that the break occurred "* * * in the area below the channel iron".[4] The word "area" was used by the witness to designate that part of the wire rope which lay beneath the channel iron. The parting of its fabrics apparently did not take place because of abrasion as warned against in the manual heretofore referred to.
The scaffold and its accouterments[5] weighed not more than 300 pounds. King weighed 150 pounds and Ellis weighed 170 pounds. The total burden upon the wire rope did not exceed 650 pounds. Actually the suspended weight was one-half of this since the scaffold was hung from two places, halving the weight.
The plaintiffs introduced into evidence a manual published by Macwhyte. At the top of the pertinent page appears the following: "Macwhyte Wire Rope, 6×42, Tiller or Hand Rope". There follows a printed simulacrum of the rope and a cross-section of it. Then appears, inter alia, the following:
"This is the most flexible wire rope made but because of its fine wires, it should be subjected to very little abrasive wear. It is made of 6 strands of 42 wires each,[6] a total of 252 wires. Each strand is a complete 6×7 rope fabricated around a central hemp cord making 7 hemp cords in all.
"It is used as a hand rope in connection with the operating device of passenger and freight elevators, as steering cable on small *449 boats and steamers, and for industrial and mining devices.
"Prices: List Price for Bright Ropes are shown below. Any rope smaller than that listed takes the price of the smallest rope listed. Any other omitted sizes take the next largest price shown. For Galvanized Ropes add 25% to these lists and apply the Bright Rope discount."
Then follow the words and figures: "Macwhyte 6×42 Tiller Rope" and a chart in box form. The first column headed "Diameter in Inches" gives various widths of rope beginning at 3/16ths and running to 7/8ths including 5/16ths. The next column headed "List Price Per Foot", is divided into 3 sub-columns headed respectively, "Iron", "Cast Steel" and "Plow Steel". Under the heading "Iron" and parallel to the figures "5/16" hereinbefore referred to appears ".08". The third column is headed "Approx. Weight Per Ft. in Lbs." and in this column parallel to the figures "5/16" and ".08" appears ".11". The last column is headed "Approx. Breaking Strength in Tons of 2000 lbs." This column has three sub-headings, viz., "Iron", "Cast Steel" and "Plow Steel" and under the column headed "Iron" and parallel to the figures heretofore specifically designated, "5/16", ".08" and ".11" appear the figures ".977". Translating the foregoing into non-technical language it would appear that the wire rope used by King should have supported a weight of almost one ton or, using a very broad margin of safety, more than twice that which had been put upon it when the accident occurred.
Macwhyte, asserting that the wire rope was not put to any use for which it was intended, pointed out that it was not used as a hand rope in the operation of an elevator or as a steering cable on a small boat or for industrial and mining signal devices, or put to any like use. The plaintiffs assert that this is immaterial; that the table of tensile strengths quoted from the manual was none the less applicable; that the tensile strength ascribed by the manual to wire rope of this size was much more than was required to suspend safely the weight that it was required to carry.
Macwhyte contends that since the wire rope was galvanized it was not within the purview of the tensile strengths shown in the manual. This contention, however, is belied by the page itself. The only reference to "Galvanized Ropes" was the following, "For Galvanized Ropes add 25% to these lists and apply the Bright Rope discount." As will be observed the allusion to galvanized ropes relates only to price and not to tensile strength. The table of tensile strengths immediately follows the sentence quoted. The representation in the manual therefore is to the effect that galvanized wire ropes would possess the same or substantially the same tensile strengths as the ungalvanized ropes referred to in the manual. No substantial evidence was introduced which indicates that galvanized wire ropes possess less tensile strength than wire rope which is not galvanized.[7]
The rule enunciated by the Supreme Court in Klaxon Co. v. Stentor Electric Co., 313 U.S. 487, 496, 61 S. Ct. 1020, 85 L. Ed. 1477 requires mention. That ruling is to the effect that in diversity of citizenship cases, such as those at bar, a federal court must follow the rule of conflict-of-laws of the State in which it sits. The conflict-of-laws rule of Pennsylvania is that the law of the place where the operative facts occurred must govern the rights of the parties. See the Pennsylvania Annotations to Section 378, Restatement, Conflict of Laws, as cited. Since the operative facts took place in Pennsylvania that law will govern the substantive rights of the parties. Under Pennsylvania law the plaintiffs may approach the goal of recovery by two roads as they have attempted to do in the cases at bar: viz., (1) by proof of breach of express warranty or (2) by proving that Macwhyte was negligent in its manufacture of the wire rope or in the inspection of it. We think it is clear that whether the approach to the problem be by way of warranty or under the doctrine of negligence, the requirement *450 of privity between the injured party and the manufacturer of the article which has injured him has been obliterated from the Pennsylvania law. The abolition of the doctrine occurred first in the food cases, next in the beverages decisions and now has been extended to those cases in which the article manufactured, not dangerous or even beneficial if properly made, injured a person because it was manufactured improperly. Compare the early case of Holmes v. Tyson, 147 Pa. 305, 23 A. 564, 15 L.R.A. 209, with recent foods and beverages cases such as Scalise v. F. M. Venzie, Inc., 301 Pa. 315, 152 A. 90, and Nock v. Coca-Cola Bottling Works, 102 Pa. Super. 515, 156 A. 537.[8] Compare the decision in Henderson v. National Drug Co., 343 Pa. 601, 23 A.2d 743. In the Henderson decision the Supreme Court of Pennsylvania indicated, albeit by way of dictum, that it would have held the manufacturer of a food liver concentrate guilty of negligence if it had proved that the concentrate had been prepared improperly or contained an irritant substance. See also the decision in Saganowich v. Hachikian, 348 Pa. 313, 35 A.2d 343. In this case the plaintiff, an employee of the purchaser of a drum of liquid caustic soda, was permitted to recover against the manufacturer of the soda who had equipped the drum with a defective plug. The plug came loose, spraying the employee with caustic which injured him. Compare such cases as Ebbert v. Philadelphia Electric Co., 330 Pa. 257, 198 A. 323, and Wissman v. General Tire Co., 327 Pa. 215, 192 A. 633.
The Supreme Court of Pennsylvania has approved expressly the doctrine enunciated by Judge Cardozo in MacPherson v. Buick Motor Co., 217 N.Y. 382, 111 N.E. 1050, L.R.A.1916F, 696, Ann.Cas. 1916C, 440. Indeed in the Henderson case (343 Pa. at page 611, 23 A.2d at page 749) Mr. Justice Maxey quoted from the MacPherson case as follows: "`We have put aside the notion that the duty to safeguard life and limb, when the consequences of negligence may be foreseen, grows out of contract and nothing else. * * * We have put its source in the law.'" We entertain no doubt that the law of Pennsylvania has come to the modern view suggested by Mr. Francis H. Bohlen nine years ago. That view is set out in the footnote.[9] It should also be pointed out that the Supreme Court of Pennsylvania frequently has adhered to the Restatement, Torts, in cases somewhat analogous on their facts to those of the cases at bar.[10] We think that the Pennsylvania law which must be considered under the plaintiffs' proof, whether by way of proof of breach of warranty or proof of negligence, is embodied in the Restatement, Torts, Section 395. Section 395 is as follows: "A manufacturer who fails to exercise reasonable care in the manufacture of a chattel which, unless carefully made, he should recognize as involving an unreasonable risk of causing substantial bodily harm to those who lawfully use it for a purpose for which it is manufactured and to those whom the supplier should expect to be in the vicinity of its probable use, is subject to liability for bodily harm caused to them by its lawful use in a manner and for a purpose for which it is manufactured." Section 395 is in fact a restatement of the language *451 employed by Judge Cardozo in the MacPherson case quoted above.
Dealing now with the alleged breach of warranty, ((1) supra), we state that the plaintiffs endeavored to prove that the contents of Macwhyte's manual came to King's knowledge and that he bought the wire rope because of the representations contained in it. The plaintiffs failed in this proof but in our opinion it was unnecessary to make it. McCarthy, the salesman employed by Bradford, testified that the manual was Macwhyte's manual, that it was widely disseminated by Bradford to purchasers and to prospective purchasers. This is important because the words and figures of the manual were a representation by the manufacturer of the tensile strength of the wire rope and the purposes for which it was manufactured. These representations ran to the public, to King and to Ellis, for as we have demonstrated no privity between Macwhyte and King and Ellis had to be shown. We conclude that the representations of Macwhyte's manual constituted an express warranty within the provisions of Section 12, P.L. 543 (1915), 69 P.S.Pa. Sec. 121.[11] The representations of the manual as to the tensile strength of the wire rope of the size purchased by King were binding on Macwhyte. If King was killed and Ellis was injured because the wire rope broke, having been subjected to less strain than that set forth in the table of tensile strengths, the plaintiffs would be entitled to recover by way of breach of express warranty provided the wire rope was used by King for a purpose intended by Macwhyte. At this point the plaintiffs' case, insofar as it is based on warranty, fails for it is clear that King did not use the rope for any purpose specified in the manual or for a purpose analogous to those specified. Our reasons for this conclusion follow.
The manual states: "It [the wire rope] is used as a hand rope in connection with the operating device of passenger and freight elevators, as steering cable on small boats and steamers, and for industrial and mining signal devices." The title of the page, printed in large capital letters, is "Tiller or Hand Rope". The manual also states, "This is the most flexible wire rope made * * *". Obviously Macwhyte did not intend the wire rope to be used only in connection with the operating device of an elevator or as a steering cable for a small boat or for industrial and mining signal devices. Any analogous use would be within the purview of the paragraph last quoted. But to employ the wire rope for the suspension of a load and a "live" load at that, viz., to support a scaffold on which men were working with the inevitable concomitant of ever-shifting tensions and strains,[12] may not be deemed to be within the scope of the purposes designated by Macwhyte in its manual. None of the purposes designated by Macwhyte included the suspension of any large load, dead or live.
This conclusion is supported by other phrases which we have quoted from the page of the manual. A tiller rope is a rope used for turning the tillers of "small boats and steamers". A hand rope is a rope to be hauled or manipulated by hand. Such ropes, for example, are employed for the operation of the valves of water-lift elevator mechanisms. It is a matter of common knowledge that the quality of great flexibility and the quality of great strength ordinarily do not occur in the same kind of wire rope. In this connection we point out *452 that the manual asserts that the Macwhyte tiller or hand rope is "the most flexible wire rope made". The table of tensile strengths in the manual must be read in the light of the manufacturer's stated uses for the wire rope and with due regard for all other pertinent statements in the manual.
We conclude that under the representations of the manual, which serve to define the scope of the warranty, the court below properly concluded that King had not used the wire rope for a purpose set out in the manual. No sufficient proof of breach of express warranty was made by the plaintiffs.
We will deal now with the asserted negligence of Macwhyte, ((2) supra). Since it is no longer necessary to prove privity between manufacturer and injured person and since the Pennsylvania Supreme Court has put the manufacturer's duty "to safeguard life and limb" "in the law"[13], if an article used for the purpose for which it was intended is defective and an accident results therefrom the manufacturer is liable. But the wire rope employed by King was not used for the purpose for which Macwhyte manufactured it. If it had been used as intended, despite the fact that the Supreme Court of Pennsylvania denies the application of the doctrine of res ipsa loquitur, we would conclude that the jury would be entitled to infer that the wire rope had been manufactured improperly and that a resulting defect has caused it to break. An analogy is supplied by Giordano v. Clement Martin, Inc., 347 Pa. 61, 31 A.2d 504.
Since it is clear that the wire rope was used by King for a purpose for which it was not manufactured by Macwhyte, no inference of negligence in manufacture from the mere fact that the rope broke could be drawn by the jury. The plaintiffs therefore were faced with the burden of proving that the rope broke not because it was used for a purpose for which it was not intended but because of a defect in manufacture. They fell far short of sustaining this burden. Their nearest approach lay in two questions asked by their counsel of Abbott who testified on their behalf. The first question in pertinent part was as follows, "In your opinion, would it be safe to use rope of that character [used by King] of good manufacture and in good condition, to sustain * * * [the] load * * * [under the circumstances]?" The witness answered, "I do." Reading the answer, "I do" as "Such would be my opinion", it will be observed that the answer falls far short of proving negligence in the manufacture of the wire rope. The second question, which came very close to the point, was as follows, "To you, as an experienced man in this business, [sic] in your opinion would this rope have parted had it been up to standard?" The witness never answered the question. No proof whatsoever was adduced as to any negligent inspection of the wire rope by Macwhyte.
The judgments are affirmed.
NOTES
[1] We again call the attention of counsel to the provisions of our Rule 26. It is the duty of the attorneys for the parties to print in the appendix all matters which should be called to the court's attention.
[2] See King v. Macwhyte Co., D.C., 60 F. Supp. 75.
[3] Mrs. Mannsz' case was at No. 2120 in the court below and is on appeal at our No. 8999. Ellis's case was at No. 2592 in the court below and is on appeal at our No. 9000.
[4] See testimony of Smith, p. 62a.
[5] These may have included a number of steel sheets with which the men were working. The sheets may have increased the weight on the scaffold by another 100 pounds.
[6] Hence the designation in the manual and in the complaint as "6×42" wire.
[7] McCarthy, an employee of Bradford, who sold the rope, testified that galvanization might reduce the tensile strength of the rope 1 or 2% but added "* * * I don't know." This is all the testimony in the record on this subject. The witness was not qualified as an expert.
[8] As is stated in the "Pennsylvania Annotations" to the Restatement, Torts, Pa. 212, "The food cases are complicated by the Act of May 4, 1889, P.L. 87, 69 P.S. § 123 note, which creates an implied warranty in a sale of food that the food is `sound and fit for household consumption.' and by the Sales Act of May 19, 1915, P.L. 543, Secs. 14 and 15, 69 P.S. §§ 123, 124." See Catani v. Swift & Co., 251 Pa. 52, 95 A. 931, L.R.A.1917B, 1272, and the other cases cited in the Annotations.
[9] See Bohlen, Fifty Years of Torts, 50 Harv.Law Rev. 1225, 1234. Mr. Bohlen stated, "In Pennsylvania the earlier decisions which [absent privity between the purchaser and manufacturer] denied liability on the ground that its imposition would prevent any sane man from becoming a manufacturer or a contractor have been so whittled away that it may be safely said that it only requires a decision directly presenting facts similar to those in MacPherson v. Buick Motor Co. to cause the court to overrule the earlier decisions and accept the modern view."
[10] See for example the Saganowich case, supra, citing with approval the Restatement, Torts, Section 392, Ebbert v. Philadelphia Electric Co., supra, citing Sections 402 and 388, and Wissman v. General Tire Co., supra, citing Sections 394 and 395.
[11] The pertinent portion of the statute is as follows: "Any affirmation of fact or any promise by the seller relating to the goods is an express warranty if the natural tendency of such affirmation or promise is to induce the buyer to purchase the goods, * * *." See also the Uniform Sales Act, Section 12.
[12] See Kidder-Parker, Architects' and Builders' Handbook, 18th Ed., p. 126, in pertinent part as follows: "Dead Loads and Live Loads. The term Dead Load means a load that is applied and increased gradually and that finally remains constant, such as the weight of a structure itself. The term Live Load means a load that is applied suddenly and causes vibrations, such as a train traveling over a railway bridge. It has been found by experience that the effect of a live load on a beam or other piece of material has twice the destructive tendency of a dead load of the same magnitude or intensity. Hence a piece of material designed to carry a live load should have a factor of safety twice as large as one designed to carry a dead load."
[13] In Henderson v. National Drug Co., 343 Pa. at page 611, 23 A.2d at pages 748, 749, Mr. Justice Maxey stated that an action for personal injuries brought against the manufacturer, not based on an express warranty, should be ex delicto and not ex contractu, citing 28 C.J.S. Druggists, § 10, page 517. Mr. Justice Maxey went on to say, "It is, of course, not necessary to plead a warranty in cases like this, for the action is based upon a breach of duty imposed by law." | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563721/ | 960 A.2d 957 (2008)
COMMONWEALTH of Pennsylvania/DEPARTMENT OF PUBLIC WELFARE, Petitioner
v.
WORKERS' COMPENSATION APPEAL BOARD (HARVEY), Respondent.
No. 802 C.D. 2008.
Commonwealth Court of Pennsylvania.
Submitted on Briefs September 19, 2008.
Decided November 26, 2008.
*959 J. Brendan O'Brien, Philadelphia, for petitioner.
Marla A. Joseph, Jenkintown, for respondent.
BEFORE: PELLEGRINI, Judge, and LEAVITT, Judge, and McCLOSKEY, Senior Judge.
OPINION BY Judge LEAVITT.
The Commonwealth of Pennsylvania, Department of Public Welfare (Employer) petitions for review of a remand order of the Workers' Compensation Appeal Board (Board). The Board directed the Workers' Compensation Judge (WCJ) to receive additional evidence on the amount of credit Employer could claim against the disability compensation owed to Larry Harvey (Claimant) by reason of Employer's contribution to Claimant's pension from the State Employees' Retirement System. Concluding that the Board's remand order is at odds with this Court's binding precedent, we reverse and reinstate the order of the WCJ.
Claimant suffered a work injury on July 24, 2001, and he began receiving total disability compensation. On June 10, 2005, Employer issued a notice of workers' compensation benefit offset, informing Claimant that Employer was taking a credit against Claimant's disability compensation commensurate with its contribution to Claimant's retirement benefits.[1] Employer asserted a right to both a retroactive and prospective credit in the amount of $1,577.01 per month. On September 1, 2005, Claimant filed a review petition to challenge Employer's offset. Employer filed a timely answer denying the material allegations in Claimant's review petition.
At the hearing, Employer presented the deposition testimony of Linda Miller, Director of the Benefit Determination Section of the State Employees' Retirement System (SERS). As Director, Miller oversees the calculation and payment of retirement, disability, and death benefits owed to members of SERS. Funding for the Commonwealth's defined benefit plan is provided by employee and Employer contributions, as explained by Miller in two depositions. The first deposition took place on October 27, 2005. At the second deposition on June 22, 2006, Miller corrected an error in her first deposition that resulted from SERS' failure to consider Claimant's debt owed to SERS for his purchase of service credit.[2] In that second deposition, Miller explained that Claimant's account was valued by first identifying the annual maximum single life annuity,[3]*960 subtracting Claimant's debt for his purchase of service credit, and then multiplying the remaining annual annuity amount by a life expectancy factor, which was 9.47370. This resulted in a total pension value of $214,746.42. Claimant's contribution to that total was determined by (1) calculating the sum total of all his contributions and (2) adding to that total an assumed 8.5 percent return on all those contributions. Subtracting Claimant's contributions plus interest from the total pension value produced Employer's contribution, which was determined by Miller to be $19,739.40 annually or $1,644.95 monthly.
Employer also presented the deposition testimony of Brent Mowery, a licensed actuary who does extensive consulting work for SERS. In particular, Mowery annually undertakes an actuarial valuation to determine the funding needs for the Commonwealth's defined benefit plan.[4] He also routinely calculates the Commonwealth's contribution to an individual's annuity where, as in this case, the member is receiving workers' compensation disability benefits in addition to his retirement pension from SERS.[5] The amount Employer contributes each year on behalf of a particular member fluctuates according to actuarially established funding needs.
With respect to the 8.5 percent assumed rate of return on Claimant's contribution, Mowery explained that it is impossible to specify the exact earnings on a single member's contribution in any given year. In a good year, SERS may realize a return of 15 percent on the funds it manages; in a bad year SERS may realize a negative return on its investments. Mowery testified that the assumed 8.5 percent annual return was reasonable and did not favor either Claimant or the Commonwealth. He explained why the assumed rate of return was preferable to using actual historical rates of return during the years that Claimant was contributing to the system:
Q.... Can't we look back in the past during [Claimant's] years of service and come up with what the rate of return was in all of the years that are applicable for the purpose of doing his calculation?
A. Yes, you can identify those rates of return. However, it is a problem to *961 take into account actual levels of investment return in the determination of the benefits under the defined benefit pension plan where the benefit is not and should not be a function of the results of investments of assets underlying the plan, and it goes back to that same princi[p]le that I had discussed before that the defined benefit pension plan design is one under which [Employer] bears the full risk of investment of assets and [Claimant] is essentially insulated. [Claimant's] benefits will not vary upward or downward as a result of the actual investment experience of the plan.
Deposition of Brent Mowery, 6/1/06, at 118-119; R.R. 118a-119a (emphasis added).
Mowery also testified that he reviewed Miller's calculation of the amount of Claimant's offset. Noting that Claimant had elected to pay for his purchase of military time by having his annuity payment reduced until the debt was extinguished, Mowery advised Miller to revise her calculations. When she did so, the amount of the credit to which Employer was entitled was established at $1,644.95 per month.
Claimant presented no evidence in support of his review petition. He presented no evidence in opposition to Employer's case.
The WCJ denied Claimant relief. The WCJ credited the unrefuted testimony of Miller and Mowery and concluded that the assumed 8.5 percent return on Claimant's contributions was appropriate. He explained this conclusion as follows:
Based upon a careful and thorough review of the foregoing record, Claimant's Review Petition is denied. . . . In so holding, this adjudicator finds the unrefuted testimony of Ms. Miller and Mr. Mowery to be credible and competent. In Pennsylvania State University v. WCAB (Hensal), 911 A.2d 225 (Pa. Cmwlth.2006), the Court noted that defined benefit plans are a subject particularly amenable to expert testimony. It is therefore significant that Claimant presented no expert evidence to rebut the testimony of [Employer's] actuary. In addition, the following are specifically found;
a. The uncontradicted testimony of Ms. Miller and Mr. Mowery establishes that the plan under which Claimant receives disability retirement benefits falls within the definition of a defined benefit plan in Section 123.2 of the Bureau Regulations. . . . Although amounts were not contributed to a pension fund on behalf of the Claimant as an individual, by definition contributions are not made on behalf of individual employees in a defined benefit plan. In this regard, the testimony of Mr. Mowery and Ms. Miller is credited and the distinction noted in Section 123.2 of the regulation between defined benefits and defined contribution plans is noted.
b. The actuarial opinion given b[y] Mr. Mowery that an 8.5% actuarial assumption rate was appropriate is credited. In this regard, it is noted that the actual statutory rate of return on Claimant's retirement contributions was only 4%. The rate of return applied by [Employer] therefore results in a higher amount than [Employer's] funding responsibilities could vary based upon market returns, he indicated that this was innate to a defined benefit plan wherein an employees contributions were fixed and an employe[r] is responsible to ensure that the plan as a whole is adequately funded. In this regard, Mr. Mowery noted that the investment risk is borne by [Employer] in a defined benefit *962 plan given that investments may not [r]each assumed levels.
c. . . . It is noted that Mr. Mowery's testimony that the methodology used by Ms. Miller was sound from an actuarial standpoint is completely unrefuted. This is significant given that Claimant receives more disability pension funds tha[n] he would have based upon his contributions plus the actual 4% rate of return.
WCJ Decision at 4-5, Finding of Fact No. 6; R.R. 282a-83a (emphasis added).
Claimant appealed to the Board, and it remanded the matter to the WCJ. The Board found a remand was warranted because the WCJ's five findings of fact were insufficient.[6] The Board held that:
The [WCJ] failed to make "critical" findings of fact listed by the court in Cato and failed to make any credibility determinations concerning those witnesses.
Board Opinion at 6; R.R. 291a. The Board also concluded that Employer should not have used an assumed rate of annual return to calculate Claimant's contribution to his annuity. Accordingly, the Board remanded, stating:
The matter is REMANDED for the [WCJ] to reopen the record for the submission of additional evidence as is necessary to determine the extent of [Employer's] funding of Claimant's pension, including evidence concerning the actual present value of Claimant's pension fund contributions based on the historical rates of return of the SERS pension fund, and for the [WCJ] to make necessary credibility determinations, findings of fact, and conclusions of law consistent with the foregoing Opinion.
Board Opinion at 10; R.R. 295a (emphasis added). Employer petitioned for this Court's review of the Board's remand order.
On appeal,[7] Employer contends that the Board exceeded its scope of review. First, Employer argues that the Board erred because it ignored the WCJ's credibility determinations. Second, Employer contends that the Board's directive that the WCJ determine Claimant's contribution on the basis of SERS' year-by-year rate of return would have the WCJ find so-called "critical facts" that lack any legal significance. Indeed, a hearing to determine those facts would violate this Court's binding precedent. In response, Claimant contends that Employer's appeal should be quashed because the Board's remand order is interlocutory.
We turn, first, to the question of whether the Board's remand order is appealable.[8] Employer contends that the *963 Board's remand order is appealable as of right under Pennsylvania Rule of Appellate Procedure 311(f)(2).
The Board's remand order is interlocutory, and as such, generally not appealable. Peterson v. Workers' Compensation Appeal Board (Wal Mart & CMI, Inc.), 938 A.2d 512, 515 (Pa.Cmwlth.2007) (holding that a remand order of the Board is interlocutory and unappealable). However, as we further observed in Peterson, the Pennsylvania Rules of Appellate Procedure authorize the appeal of an interlocutory order in two circumstances. Rule 311(f) states:
(1) an order of a . . . government unit remanding a matter to an administrative agency or hearing officer for execution of the adjudication of the reviewing tribunal in a manner that does not require the exercise of administrative discretion; or
(2) an order of a . . . government unit remanding a matter to an administrative agency or hearing officer that decides an issue which would ultimately evade appellate review if an immediate appeal is not allowed.
PA. R.A.P. 311(f) (emphasis added). Employer contends that the Board's remand order is appealable as of right under Rule 311(f)(2), arguing that if the WCJ makes new findings on the amount of Claimant's contribution to his pension, then his original decision will become moot and evade review. Further, Employer will be required to attend an unnecessary and illegal hearing.
In Lewis v. School District of Philadelphia, 690 A.2d 814 (Pa.Cmwlth.1997), this Court considered a trial court's remand order directing the school district's board to conduct a hearing on Lewis' dismissal from his employment. The school district and board asserted that the plaintiff was not entitled to any hearing other than the one that had already been conducted by a hearing officer and on the basis of which the board would issue its adjudication. If the board were required to conduct another, and illegal, hearing, then the school district's appeal seeking relief from that hearing would become moot. This Court agreed and granted the school district an appeal under Rule 311(f)(2). To hold otherwise would have deprived the school district and the board the relief they sought, i.e., being excused from the second hearing.
The present case is analogous to Lewis. Claimant argues that if the WCJ renders a different decision on remand, then Employer can appeal that decision. However, in that case, Employer would be forced into a hearing for what Employer contends is an improper purpose. Employer argues that binding precedent has already approved the use of an assumed 8.5 rate of return to calculate the amount of a workers' compensation claimant's contribution to his SERS pension. It violates decisional law to take evidence on another methodology, as ordered by the Board. As in Lewis, Employer will lose the relief sought in its petition for review, i.e., being excused from a completely improper hearing. We agree and hold that the Board's remand order in this case is appealable as of right under Rule 311(f)(2).
We turn, then, to the merits of Employer's appeal. Employer contends that the Board erred in ignoring the WCJ's credibility determinations and in holding that the WCJ failed to make critical findings of fact. We agree.
It goes without saying that the "WCJ is the ultimate finder of fact and the exclusive arbiter of credibility and evidentiary weight." Daniels v. Workers' Compensation Appeal Board (Tristate Transport), 574 Pa. 61, 76, 828 A.2d 1043, 1052 *964 (2003). It is also the case that the Board has the authority to remand a matter to the WCJ to take of additional evidence where the WCJ's findings are not supported by substantial evidence or where the WCJ fails to make findings on a crucial issue for a proper application of the law. Section 419 of the Act, added by Section 6 of the Act of June 26, 1919, P.L. 642, as amended, 77 P.S. § 852;[9]Reinert v. Workers' Compensation Appeal Board (Stroh Companies), 816 A.2d 403, 407 (Pa. Cmwlth.2003). In this case, however, neither basis for a remand can be found.
First, the WCJ did make credibility determinations. He expressly credited Miller and Mowery and detailed the reasons for so doing. WCJ Decision at 4-5; R.R. 282a-83a.
Second, there are no missing "critical" findings of fact, as asserted by the Board. To have the WCJ determine the amount of Claimant's pension fund contributions by establishing the rates of return of the SERS pension fund for each year of Claimant's contribution would send the WCJ on a meaningless mission. Indeed, it would violate this Court's prior holdings on this point.
The legal sufficiency of an actuarially assumed rate of annual return has been decided by this Court in Department of Public Welfare/Western Center v. Workers' Compensation Appeal Board (Cato), 911 A.2d 241, 246 (Pa.Cmwlth.2006) and Pennsylvania State University v. Workers' Compensation Appeal Board (Hensal), 911 A.2d 225, 232 (Pa.Cmwlth.2006). In Cato, this Court followed its decision in Hensal to hold that the Commonwealth can use an expert actuarial opinion to establish its contribution to an employee's retirement annuity. Miller and Mowery testified for Employer regarding the Commonwealth's contribution to the claimant's pension amount in Cato, and as the WCJ noted in the present case,
the evidence presented by [Employer] in the instant matter is virtually identical to the evidence upheld by the Commonwealth Court in DPW v. WCAB (Cato), 911 A.2d 241 (Pa.Cmwlth.2006), as sufficient to establish a pension offset.
WCJ Decision at 5; R.R. 283a (emphasis added).[10] In Hensal, Miller and Mowery similarly used the 8.5 percent investment return rate to calculate the amount of the claimant's contribution to his SERS pension. This Court held that
[s]ince an employer cannot provide evidence of actual contributions for the use of an individual member of a defined benefit pension plan, it may meet its burden of proof, as Employer attempted to in this case, with expert actuarial testimony. Employer's expert evidence here, if accepted as credible, is legally sufficient to establish the extent to which Employer funded Claimant's defined benefit pension for purposes of offset.
911 A.2d at 232. In sum, this Court already decided that the expert evidence *965 presented in Hensal and Cato was legally sufficient; therefore, the legal sufficiency of identical evidence in the present appeal is governed by controlling precedent. The Board erred in remanding the matter to the WCJ for the submission of additional evidence on the actual rate of return on Claimant's contributions.
Finally, we note that the WCJ's Order states that "[Employer] is entitled to a monthly offset of $1,995.52 based upon the retirement benefits received by Claimant." WCJ Decision at 5; R.R. 283a. This amount is a typographical error; $1,995.52 is the amount of Claimant's monthly pension before it was reduced by Claimant's debt for his purchase of his military service. In Finding of Fact No. 5, the WCJ found that "the revised calculation of $1,644.95 offset was correct from an actuarial standpoint." WCJ Decision at 3; R.R. 281a.[11] It is clear that the reference to "$1,995.52" in the WCJ's order was a typographical error and should be corrected to read "$1,644.95."
Accordingly, we reverse the Board and reinstate the WCJ's order as modified by this opinion.
ORDER
AND NOW, this 26th day of November, 2008, the order of the Workers' Compensation Appeal Board, dated April 4, 2008, is hereby REVERSED and the order of the Workers' Compensation Judge, dated April 13, 2007, is REINSTATED and MODIFIED to read as follows:
AND NOW, this 4th day of April, 2007, the Claimant's Review Petition is DENIED and DISMISSED. Defendant is entitled to a monthly offset of $1,644.95 based upon the retirement benefits received by Claimant.
CONCURRING OPINION BY Senior Judge McCLOSKEY.
I concur with the result reached by the majority in this case because I believe the present law proclaims actuarial testimony is sufficient to carry the employer's burden when seeking an offset, but I write separately to set forth my view that if the actual rate of return can be determined for each year that an employee worked, as acknowledged by the actuary in this case, then the actual rate, rather than an assumed rate, should be used in calculating an offset.
NOTES
[1] Section 204(a) of the Workers' Compensation Act (Act), Act of June 2, 1915, P.L. 736, as amended, states in relevant part:
The severance benefits paid by the employer directly liable for the payment of compensation and the benefits from a pension plan to the extent funded by the employer directly liable for the payment of compensation which are received by an employe shall also be credited against the amount of the award made under sections 108 [occupational disease] and 306 [total and partial disability], except for benefits payable under section 306(c) [specific loss benefits]....
77 P.S. § 71 (emphasis added).
[2] Claimant purchased his military service and elected to take a reduction in his monthly retirement amount as the method of payment for this purchase. Including this election in the calculation changed the value of his maximum annual single life annuity which, in turn, changed the offset amount.
[3] The formula SERS used to calculate the maximum single life annuity is defined in the State Employees' Retirement Code as follows:
"Standard single life annuity." An annuity equal to 2 of the final average salary, multiplied by the total number of years and fractional part of a year of credited service of a member.
71 Pa.C.S. § 5102. Miller further broke it down as follows: 2 percent times the member's total years of service times the member's final average salary times the class of service multiplier. Deposition of Linda Miller, 6/22/06, at 15 (Miller Depo. ____); Reproduced Record at 243a (R.R. ____).
[4] A defined benefit plan is defined at 34 Pa. Code § 123.2:
Defined-benefits planA pension plan in which the benefit level is established at the commencement of the plan and actuarial calculations determine the varying contributions necessary to fund the benefit at an employes retirement.
[5] The Bureau of Workers' Compensation has promulgated regulations regarding the offset of workers' compensation benefits where an injured employee also receives pension benefits. See 34 Pa.Code §§ 123.1-123.11. Mowery explained that the formula required working backwards from the estimated amounts of pension benefits claimant will receive in his lifetime. Then, an 8.5 percent assumed rate of annual return on investments is applied to the amount that claimant contributed to arrive at claimant's share. Employer's share is determined by subtracting claimant's share from the total value of claimant's pension fund. A spreadsheet was developed based on the formula to facilitate calculations in each specific case.
[6] The Board stated that there were five findings of fact. There were six. The sixth finding of fact detailed the WCJ's credibility determinations, as set forth above.
[7] This Court's scope and standard of review of an order of the Board is limited to determining whether the necessary findings of fact are supported by substantial evidence, whether Board procedures were violated, whether constitutional rights were violated or an error of law was committed. Melmark Home v. Workers' Compensation Appeal Board (Rosenberg), 946 A.2d 159, 161 n. 3 (Pa.Cmwlth. 2008).
[8] Section 763(a) of the Judicial Code, 42 Pa. C.S. § 763(a), provides that this Court has jurisdiction to hear appeals from final orders of Commonwealth agencies. Pennsylvania Rule of Appellate Procedure 341(a) provides the general rule for appeals from the "final order" of an administrative agency. Rule 341 defines a final order as one that:
(1) disposes of all claims and of all parties; or (2) is expressly defined as a final order by statute; or (3) is entered as a final order pursuant to subdivision (c) of this rule [dealing with determination of finality by the governmental unit].
PA. R.A.P. 341(b).
[9] Section 419 provides that
[t]he board may remand any case involving any question of fact arising under any appeal to a referee to hear evidence and report to the board the testimony taken before him or such testimony and findings of fact thereon as the board may order. The department may refer any question of fact arising out of any petition assigned to a referee, to any other referee to hear evidence, and report the testimony so taken thereon to the original referee.
77 P.S. § 852.
[10] The Board also held that the WCJ failed to make "critical" findings of fact as required by this Court in Cato. However, since the WCJ's findings in the present case are virtually identical to the WCJ's findings in Cato, the Board's conclusion is without merit.
[11] Miller testified that the correct offset amount was $1,644.95. See Miller Depo. at 11, 32; R.R. 239a; R.R. 260a. In Finding of Fact No. 6, the WCJ credited Miller's testimony. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563811/ | 155 F.2d 615 (1946)
BEECH AIRCRAFT CORPORATION
v.
ROSS.
No. 3242.
Circuit Court of Appeals, Tenth Circuit.
May 20, 1946.
Rehearing Denied June 14, 1946.
*616 Chas. G. Yankey, of Wichita, Kan. (Harvey C. Osborne and J. G. Sears, Jr., both of Wichita, Kan., on the brief), for appellant.
Paul R. Kitch and Howard T. Fleeson, both of Wichita, Kan. (Homer V. Gooing and Wayne Coulson, both of Wichita, Kan., on the brief), for appellee.
Before PHILLIPS, BRATTON, and MURRAH, Circuit Judges.
MURRAH, Circuit Judge.
Beech Aircraft Corporation, as the manufacturer of airplanes for the United States Army and Navy, entered into a contract with the Douglas Aircraft Corporation to build wings for its A-26 Airplane. The A-26 had never been manufactured when Beech took the contract and its design required the production of many thousands of different parts for which new "toolings" and "jigs" would have to be made. Beech entered into a sub-contract with Milburn M. Ross, doing business as Ross Engineering and Equipment Company to make the new "toolings" and "jigs," and to manufacture certain parts. The contract was evidenced by purchase order No. 1007 and No. 1066, each of which set forth the quantity and price of each unit.
The "purchase order contracts" contemplated reduction or method changes, and provided that such change in price should be subject to negotiations prior to acceptance by the sub-contractor.[1] The prices stipulated in the sub-contracts were subject to revision after completion of the first one hundred units, based upon a cost analysis during the period of fabrication.[2] Any change in the contracts was to be effected by mutual agreement through the medium of supplemental sub-contracts.[3]
In December 1943, before delivery of any units under purchase order contract No. 1007, Ross wrote Beech regarding a "revision of unit price per first one hundred units." Thereafter, the parties executed sub-contract "supplement No. 2" providing for a "tenfold" increase of the price of each unit covered by the original sub-contract, and providing further "these price increases are made due to an underestimate on the original sub-contract and are subject to final revision after completion of the first one hundred (100) units, and are retroactive over the entire sub-contract."[4]
Statements were rendered and settlements were made from time to time in accordance with the revised prices under the supplemental contract. Delivery of the first one hundred units under the contracts was completed in May, 1944. In late June or early July of the same year Beech made a cost analysis, based upon a time study of Ross' shop operations. As a result of this analysis Beech suggested that the unit prices be lowered, and conferences were held in an attempt to mutually agree on a new price. When the parties were unable *617 to reach an agreement on a revision of prices Beech ceased paying Ross' invoices. It continued, however, to accept delivery of parts at the prices contained in the contracts, as supplemented, and to extend the contracts with orders for additional parts until September 1944, when it finally cancelled the contracts. Ross brought this suit on the contracts, as supplemented, to recover the unpaid balance of the alleged contract price for units manufactured and delivered to Beech in the sum of $98,865.43.
Beech's defense to the suit there, and here, is that the prices established by the contracts, as supplemented, were mere estimate, it being the plain intention of the parties to finally revise the unit prices, based upon experience gained from production and a time study of Ross' operations after the first one hundred units had been produced. Accordingly, it tendered a cost analysis of Ross' operations, based upon a time study, and argues that since the parties are unable to mutually agree upon a final revision of the prices the court should judicially determine a price, based upon a reasonable profit, to be retroactive over the entire contract.
The trial court held that by the original purchase order contracts the parties agreed in writing to negotiate price revisions only by mutual agreement; that the parties did so revise the price schedule by the execution of the supplemental contracts, and the prices thus established were binding upon the parties to the contracts until revised by mutual consent, or until the contracts were cancelled under their provisions. In so holding, the court pointed out that there was nothing in the contracts or the supplements to indicate that upon failure of the parties to negotiate new prices, resulting in a cancellation of the contracts, the court was authorized to write a contract for the parties, thereby establishing prices upon which they did not, and could not agree.
It is true that the prices stipulated in the supplemental contracts were subject to final revision, after completion of the first one hundred units, and that the finally revised prices were to be retroactive over the entire sub-contract, but the supplemental contracts provided no formula for final revision of the prices. The parties obviously intended to rely upon the provisions of Item XXV (see footnote 2), which provides for revision after completion of the first one hundred units based upon an actual time study of a cost analysis. Indeed, when Ross requested a change in the unit prices, he expressly stated in his letter of December 23rd, 1943, that upon completion of the first one hundred units the price of each item was to be subject to the provisions of Item XXV.
It is the general rule that a contract price must be definite and certain, or capable of ascertainment from the contract itself, else it cannot be enforced. Vol. 12, American Jurisprudence Contracts, Sec. 70; Annotation, 92 A.L.R. 1396; Williston on Contracts (R.Ed.) Sec. 45. If, however, the contract contains matter which will enable the court to ascertain the terms and conditions on which the parties intended to bind themselves, it will give effect to the manifest intention of the parties. The courts will not permit a contract to fail for the want of a formal detail, which can be supplied within the frame work of the contract itself. Thus, if the contract provides for the payment of a reasonable or a just and equitable price, and the parties are unable to agree upon what is reasonable or just and equitable, the courts will imply that the parties intended for the court to determine a reasonable price as a consideration for the contract. Joy v. St. Louis, 138 U.S. 1, 11 S. Ct. 243, 34 L. Ed. 843; United States v. Swift & Co., 270 U.S. 124, 141, 46 S. Ct. 308, 70 L. Ed. 497; Brunner v. Stix, Baer & Fuller Co., 352 Mo. 1225, 181 S.W.2d 643; Raisler Sprinkler Co. v. Automatic Sprinkler Co., 6 W.W.Harr., Del., 57, 171 A. 214. Or, if the agreement makes no provision with reference to the price to be paid, the court may invoke the standard of reasonableness as a necessary implication of a policy to pay for services rendered, and the fair value of the services or property is the consideration. Vol. 12, Amer.Juris.Contracts, Sec. 324.
Neither party seeks to annul the contracts. Their differences lie in the matter of interpretation. The appellant contends that we not only have a contract for work *618 to be done without an established price, but one in which the final contract price was to be based upon a time study of a cost analysis after a certain amount of the work has been performed. It is urged that these provisions fixed the standard or formula by which the parties could reach an understanding, but if they could not so agree either party could invoke the judicial process for the ascertainment and enforcement of the price, which the parties by their contract intended, but upon which they could not agree.
We have a contract for the manufacture of goods providing for an estimated price per unit. Clearly by its very nature, the parties could not agree upon a specific price for each unit; that was necessarily left for future determination, based upon the contingencies of cost of production. Accordingly, the parties expressly stipulated for a revision of the prices upward or downward after completion of the first one hundred units, based upon an actual time study of a cost analysis. But the parties also pertinently agreed that any changes in the contract were to be effected by mutual agreement through the medium of supplemental contracts.
In accordance with these provisions, the parties did revise the originally estimated prices upward, due to an underestimate in the original price schedule, with the understanding that the revised prices were subject to a final revision based upon a time study of a cost analysis. But the supplemental agreements did not provide that Ross should be paid a "reasonable" profit based upon a cost analysis, nor did the agreements provide for a "just and equitable" price. The cost analysis furnished only a basis for negotiation for a final revision of the prices it did not provide an acceptable standard by which the court could give effect to the intention of the parties.
The record indicates persuasively that the appellee recovered more than a reasonable price; that he reaped more than a just and equitable profit for the goods he sold, but the contract was entered into freely between the parties it was drafted by appellant, and this is a straight action of law to recover upon it. We are not free to adjust the rights of the parties based upon equitable considerations. Our sole function is to determine whether, as a matter of law, the prices fixed in the contract control in the absence of a revision effectuated under the permissive provisions of the contract. The prices stipulated in the supplemental contracts were tentative and temporary, but they prevail until revised through the medium of supplemental contracts. The parties could not mutually agree upon the terms of a supplemental contract, and we cannot make one for them.
The judgment is affirmed.
NOTES
[1] Item XII "* * * C. Price Reduction or Increase. Unit price reduction or increase, due to engineering, material or method changes shall be subject to negotiations prior to acceptance of such changes by the sub-contractor."
[2] Item XXV "Prices as noted on this sub-contract are subject to revision either upward or downward, after completion of the first one hundred (100) units, This revision to be based on an actual time study of a cost analysis kept by the sub-contractor during the period of fabrication. This record shall at all times be subject to inspection and audit by any person designated by the head of any executive department of the government or any authorized representative of Beech Aircraft Corporation."
[3] Item XVIII "Supplemental Sub-contract Agreement. This purchase order shall be subject to change by mutual agreement through the medium of Supplemental sub-contracts * * *."
[4] The unit prices stipulated in purchase order No. 1066 were revised by supplemental sub-contract No. 1, and it is agreed that the two purchase order contracts, as supplemented, are not different in legal effect. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563798/ | 155 F.2d 606 (1946)
UPSON
v.
OTIS et al.
No. 267.
Circuit Court of Appeals, Second Circuit.
April 26, 1946.
As Revised on Denial of Rehearing May 23, 1946.
*607 *608 *609 Abraham Marcus, of New York City, for plaintiff-appellee.
Spence, Hotchkiss, Parker & Duryee, of New York City (Kenneth M. Spence, of *610 New York City, and Leo T. Norville, of Chicago, Ill., Julius J. Teller and David B. Tolins, both of New York City, of counsel), for individual defendants-appellees.
Simpson, Thacher & Bartlett of New York City (Robert H. O'Brien and Davis S. Junker, both of New York City, of counsel), for corporate defendants-appellees.
Samuel Marion, of New York City, for appellants.
Before L. HAND, SWAN and FRANK, Circuit Judges.
FRANK, Circuit Judge.
As Automatic had not registered under the Investment Company Act at the time of the occurrence of the transactions covered by the complaint, § 17(a) of that Act has no bearing here.[1] Under Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S. Ct. 817, 82 L. Ed. 1188, 114 A.L.R. 1487, we must therefore look to New York decisions. It would seem that they follow the usual conflict of laws rule in referring to Delaware "law" to determine the fiduciary obligations of directors of a Delaware corporation.[2]
The Delaware decisions are in accord with Irving Trust Company v. Deutsch, 2 Cir., 73 F.2d 121; see Guth v. Loft, Inc., 23 Del. Ch. 255, 5 A.2d 503, 511; cf. Bovay v. H. M. Byllesby & Co., Del. Sup., 38 A.2d 808. Whether, on the facts now presented, the individual defendants would have been liable had they bought the Majestic stock from DuMont we need not consider.[3] For Automatic bought that stock from DuMont, and these directors not only bought it from Automatic but borrowed the purchase price from that company. Thus (on the facts as now presented), in the most flagrant and inexcusable manner, they violated their obvious fiduciary obligations. Even if New York internal "law" applied, the directors would be liable in such circumstances. See Blaustein v. Pan American Petroleum Co., 293 N.Y. 281, 56 N.E.2d 705.
The Delaware courts, applying to wrongdoing directors the rules of accountability applicable to wrongdoing trustees, hold that a wrongful sale by directors to themselves of property owned by their corporation is treated as a conversion. Consequently, they hold that, where a director has improperly purchased stock from his company and then resold it, the company may elect either to hold the director for the profits he has made or ask a recovery which will restore the company "to the status quo ante as nearly as the facts and circumstances * * * will permit"; if it elects the latter, it may recover "the highest intermediate value of the stock from the time of its conversion up to a reasonable time after knowledge is acquired of the unlawful *611 act or conversion." Cahall v. Burbage, 14 Del. Ch. 55, 121 A. 646, 649.
So far as appears on this record, the improper purchases by the directors of the Majestic stock from Automatic seem to have occurred in Delaware; if so, the Delaware rule as to damages applies. But it might be urged that, as the evidence concerning the place of those purchases is not clear, we should assume that they occurred in New York. Were that true, probably the New York courts would follow Delaware in treating those purchases as conversions, on the ground that the law of the place of incorporation determines the nature of the wrong; but, since the wrongs occurred in New York, the New York rule of damages in conversion cases would control. That rule, however, is the same as Delaware's. Baker v. Drake, 53 N.Y. 211, 13 Am.Rep. 507; Griggs v. Day, 158 N.Y. 1, 22, 52 N.E. 692; Mayer v. Monzo, 221 N.Y. 442, 117 N.E. 948. We reach the same result if we assume that the New York courts would apply New York internal "law" in determining the nature of the wrong. For New York, like Delaware, treats directors, for most purposes, as trustees; Continental Securities Co. v. Belmont, 206 N.Y. 7, 16, 99 N.E. 138, 51 L.R. A.,N.S., 112, Ann.Cas.1914A, 777; People ex rel. Manice v. Powell, 201 N.Y. 194, 201, 94 N.E. 634; and conduct by a trustee, similar to that of the directors here, is held in New York to call for damages as on a conversion. People ex rel. Manice v. Powell, supra; Hart v. Ten Eyck, 2 Johns.Ch. 62, 115, 116; Mooney v. Byrne, 163 N.Y. 86, 96, 97, 57 N.E. 163.
One way or another, then, the critical question is the date when a "reasonable time" began to run. Clearly here it ran from the time when Automatic was first able to take steps, independent of the domination of the individual defendants, to go into the market to purchase the number of shares unlawfully acquired and resold by those defendants. As the market price rose after the resales by those defendants and as the price rise occurred when Automatic was not free of the domination of these defendants,[3] Automatic would plainly be better off to elect to ask for recovery on the basis of the "highest intermediate value" rather than for the profits made by those defendants. We reject the suggestion that, if these defendants had not dominated Automatic, it might, at some earlier date, have sold the Majestic stock as the result of disinterested business judgment; since the misconduct of defendants renders it impossible to ascertain whether Automatic would have done so, they may not assert that it would or might.[5] It follows *612 that, on the facts presented to the district judge, the liability of the individual defendants was indubitable and the amount of recovery beyond doubt greater than that offered in the settlement. Accordingly, it was an abuse of discretion to approve the settlement. This conclusion relates not only to the individual defendants other than Tracey but also to 31,500 of the shares bought by Tracey.
As to the other 40,000 shares which Tracey and his wife purchased, the situation is somewhat different. As, on the facts now presented, Tracey surrendered his option, previously obtained from DuMont, on 40,000 shares, in order to enable DuMont to sell to Automatic, there would have been no wrong, had he received from Automatic an option on 40,000 shares on the same terms as the surrendered option, i.e., at an average of $2.25 per share. He did receive such an option from Automatic as to 10,000; with respect thereto he is not liable. But the remaining 30,000, he bought from Automatic at a price of $1.20 per share. Consequently, on those shares, he made an unlawful profit of $1.05 a share or $31,500. As he showed no defense against that liability, to that extent the approval of the settlement also constituted an abuse of discretion.
Since the release which Tracey was to receive was not to be a general release, it would have had no effect on any claims against him with respect to the other options to which appellants refer; accordingly, we need not here consider the effect of the S. E. C. exemption order, which expressly excepted the transactions alleged in Upson's complaint. As the S. E. C. suit did not terminate in a decree on the merits, we need not consider whether, if it had, it would have barred recovery in the instant suit. Nor need we on this appeal explore the issue whether Automatic's sale of assets, the proceeds of which were used to buy the Majestic stock, was wrongful, and, if so, whether Majestic sustained resultant recoverable damages.
The district court's order must be vacated, with the consequence that the action will proceed as if no settlement had been offered. In the circumstances, appellants should be permitted to intervene.
Reversed and remanded.
On Petitions for Rehearing
PER CURIAM.
1. In their petitions for rehearing, the individual defendants state that "the theory of liability and the measure of damages adopted by this court was neither briefed nor argued in this court or below by any of the counsel in the case." But the fact is that, in the court below, counsel for appellants argued that these defendants were liable "on the theory of conversion," and in his brief here cited cases based on that theory. Counsel for plaintiff-appellee in his brief filed in this court, describing appellants' argument, said, "Basis for such rule of damage was stated to be `on the theory of conversion,'" and then proceeded for several pages to discuss decisions relating to "conversion of stock."
2. These defendants also object that in our opinion we said that they acquired the Majestic shares from Automatic; all the Majestic shares bought by these defendants, they now assert, were bought by them directly. Our version of the facts was based on the record as interpreted by and with the acquiescence of these defendants.
The record consists of (a) plaintiff's amended complaint, (b) a notice of the proposed settlement, (c) the proposed settlement, (d) affidavits, filed below, with attached exhibits, and (e) oral statements of counsel in the hearing in the district court, which preceded that court's order. That complaint, which is verified, explicitly states that Automatic had acquired the shares and sold them to these defendants; *613 plaintiff's counsel so stated in an affidavit filed below. In a colloquy in the district court hearing, he made the following statement of the facts on which the settlement offers were based:
"Mr. Marcus: Thereafter the transaction occurred which is the subject of complaint in this first transaction and that is, Automatic was caused to purchase these securities and option from DuMont. * * *"
"The Court: I see. The transaction did go through?"
"Mr. Marcus: It did go through but apparently not entirely for the benefit of Automatic. * * *"
"The Court: That money was paid by Automatic?"
"Mr. Marcus: That money was paid by Automatic. And that occurred somewhere about the end of April or the beginning of May, 1943. The 194,000 shares were taken in and the defendants Otis and Franklin and their co-directors allotted 102,500 shares out of that 194,000 shares to themselves, their wives and associates. So that the 102,500 shares were diverted from Automatic to these individuals. * * *"
"The Court: At which point did the diversion take place? Before or after the consummation of the transaction?"
"Mr. Marcus: The transaction with DuMont was consummated and I believe it was simultaneously that these shares were allotted to the individuals by Automatic."
In his brief in this court, counsel for plaintiff-appellee repeated the allegation of the complaint and, in explaining the amounts offered in settlement, said, "Since stocks acquired by the defendants from others than Automatic were also sold by them, the calculation was based on the price of all the stocks sold by the defendants during the period there involved," which plainly meant that the shares in question here were acquired by the defendants from Automatic.
In their brief filed in this court, these defendants did not challenge the statements of counsel for plaintiff-appellee, nor did they suggest that the allegation of the complaint, as to their purchases from Automatic, was incorrect.[1]
Thus this appeal was argued with the record facts interpreted by the parties to mean that Automatic bought 192,909 Majestic shares,[2] and simultaneously sold to the individual defendants 102,500 of the shares thus acquired. The fact that, as stated by plaintiff's counsel to the court below, the transactions were simultaneous, explains the fact, indicated by exhibits in the record,[3] that stock certificates for 102,500 Majestic shares were transferred directly into the names of these defendants and their designees. Of course, if Automatic bought these shares and sold them to the defendants, it is immaterial that there were no formal transfers of the certificates into the name of Automatic; sales of shares are often made without such formal transfers.
In support of their contention, made in their petitions for rehearing, that these defendants acquired no Majestic shares from Automatic, they now stress an exhibit containing an extract from the minutes of a meeting of the Automatic Board of Directors held April 20, 1943, which stated that the company "had been given the opportunity to acquire, as part of a group," from DuMont, the 192,909 shares and that those shares "had been subscribed for by the undermentioned persons for payment on or before November 30, 1943"; there follows a list of "Subscriptions For Shares" which shows "subscriptions" for 102,500 shares by these defendants, 25,000 shares by Automatic, and other shares by *614 Allied and B. T. I. Defendants now contend that this exhibit demonstrates that Automatic acquired merely 25,000 shares, and that the individual defendants acquired their Majestic shares directly, borrowing the needed funds from Automatic. But another extract from the minutes of the same meeting states the following: "The stock acquired by this corporation from the DuMont interests is subject to an option to E. A. Tracey to purchase 20,000 shares at $2 per share, and 20,000 shares at $2.50 per share."[4] Obviously, if Automatic itself acquired only 25,000 shares, that acquisition was not subject to options on 40,000 shares. The explanation of these minutes would seem to be that given by plaintiff-appellee's counsel in the district court, i.e., the acquisition by Automatic and the resales by it to these defendants occurred simultaneously.
3. We have not decided this appeal as if it were from a judgment on the merits. We have merely considered whether, on the facts presented to the court below, when it was asked to approve the settlement, there was sufficient doubt, in the light of the pertinent legal rules, about the liability and amount of damages to justify its approval order. In the district court, plaintiff and the defendants may now offer further proof in support of the settlement and then again ask for approval; or they may tender a different settlement for approval. In the alternative, they may seek judgment on the merits; any resulting decision will, of course, then turn on the correct legal rules applicable to the facts thus established.[5]
If they should seek approval in the district court of the present offers, or some others, they should have this in mind: (1) A record consisting in considerable part of colloquies between counsel and the judge is never satisfactory,[6] as we have several times advised the bar.[7] Indeed, on that ground alone we might have refused to affirm here. (2) Where court approval is asked of settlement of a suit by beneficiaries against fiduciaries, far more than a slight indication of doubt as to the likelihood of successful recovery in full against them is required; for equity closely scrutinizes settlements between fiduciaries and cestuis,[8] and, were the suit to go to trial, the fiduciaries would usually bear a heavy burden of proof as to all crucial issues.[9] To justify judicial sanction of such a settlement, *615 the fiduciaries must make a fairly detailed disclosure of the evidence which, on a trial, they would use defensively.[10]
Petitions for rehearing denied.
NOTES
[1] § 17(a) is 15 U.S.C.A. § 80a 17(a) which reads as follows:
"Transactions of certain affiliated persons and underwriters. (a) It shall be unlawful for any affiliated person or promoter of or principal underwriter for a registered investment company (other than a company of the character described in section 80a 12(d) (3) (A) and (B), or any affiliated person of such a person, promoter, or principal underwriter, acting as principal
"(1) knowingly to sell any security or other property to such registered company or to any company controlled by such registered company, unless such sale involves solely (A) securities of which the buyer is the issuer, (B) securities of which the seller is the issuer and which are part of a general offering to the holders of a class of its securities, or (C) securities deposited with the trustee of a unit investment trust or periodic payment plan by the depositor thereof;
"(2) knowingly to purchase from such registered company, or from any company controlled by such registered company, any security or other property (except securities of which the seller is the issuer); or
"(3) to borrow money or other property from such registered company or from any company controlled by such registered company (unless the borrower is controlled by the lender) except as permitted in section 80a 21 (b)."
[2] Restatement of Conflict of Laws, § 199; New York Annotations of Restatement of Conflict of Laws (1935) pp. 165, 166; German-American Coffee Co. v. Diehl (No. 2), 86 Misc. 547, 149 N.Y.S. 413, affirmed 168 A.D. 913, 152 N.Y. S. 1113; Stratton v. Bertles, 238 A.D. 87, 263 N.Y.S. 466. See also German-American Coffee Co. v. Diehl, 216 N.Y. 57, 109 N.E. 875.
[3] In all probability they would, under the Delaware decisions on the facts now before us. The same would seem to be true under the New York decisions.
[3] We leave open, for determination in the district court, the date when Automatic can be said to have been free of such domination.
[5] Bigelow v. RKO Radio Pictures, Inc., 66 S. Ct. 574; Package Closure Corp. v. Sealright Co., 2 Cir., 141 F.2d 972, 979.
In the Bigelow case, supra [66 S. Ct. 580], the Supreme Court said: "The most elementary conceptions of justice and public policy require that the wrongdoer shall bear the risk of the uncertainty which his own wrong has created. See Package Closure Corp. v. Sealright Co., 2 Cir., 141 F.2d 972, 979. That principle is an ancient one, Armory v. Delamirie, 1 Str. 505, and is not restricted to proof of damage in antitrust suits, although their character is such as frequently to call for its application. In cases of collision where the offending vessel has violated regulations prescribed by statute, see The Pennsylvania, 19 Wall. 125, 136, 22 L. Ed. 148, and in cases of confusion of goods, Great Southern Gas & Oil Co. v. Logan Natural Gas & Fuel Co., 6 Cir., 155 F. 114, 115; cf. F. W. Woolworth Co. v. N. L. R. B., 2 Cir., 121 F.2d 658, 663, the wrongdoer may not object to the plaintiff's reasonable estimate of the cause of injury and of its amount, supported by the evidence, because not based on more accurate data which the wrongdoer's misconduct has rendered unavailable. And in cases where a wrongdoer has incorporated the subject of a plaintiff's patent or trade-mark in a single product to which the defendant has contributed other elements of value or utility, and has derived profits from the sale of the product, this Court has sustained recovery of the full amount of defendant's profits where his own wrongful action has made it impossible for the plaintiff to show in what proportions he and the defendant have contributed to the profits. Westinghouse Electric & Mfg. Co. v. Wagner Electric & Mfg. Co., 225 U.S. 604, 32 S. Ct. 691, 56 L. Ed. 1222, 41 L.R.A.,N.S., 653; Hamilton-Brown Shoe Co. v. Wolf Brothers & Co., 240 U.S. 251, 36 S. Ct. 269, 60 L. Ed. 629; see also Sheldon v. Metro-Goldwyn Corp., 309 U.S. 390, 406, 60 S. Ct. 681, 687, 84 L. Ed. 825. * * * Any other rule would enable the wrongdoer to profit by his wrongdoing at the expense of his victim. It would be an inducement to make wrongdoing so effective and complete in every case as to preclude any recovery, by rendering the measure of damages uncertain. Failure to apply it would mean that the more grievous the wrong done, the less likelihood there would be of a recovery." See also Griggs v. Day, 158 N.Y. 1, 20, 52 N.E. 692.
[1] Although these defendants now tell us, in their rehearing petitions, that that allegation was erroneous in that it deviated from that contained in the complaint in the S. E. C. action (not in the record), counsel for these defendants, referring to plaintiff's complaint, had told the district court, "It is a copy of the S. E. C. complaint," and in their brief here said the allegations of the two complaints were "substantially the same."
[2] 100,000 of these shares were acquired through the exercise of an option which was bought from DuMont as part of the transaction.
[3] We have, of course, disregarded nonrecord matter contained in affidavits filed in this court in connection with the rehearing petitions.
[4] Emphasis added.
[5] A letter to this court from the Solicitor of the S. E. C. states that B. T. I., at the time of the transactions in question, was registered as an investment company under the Investment Company Act. But, as that fact is not in the record, we cannot consider what, if proved, its legal effect would be.
[6] To illustrate: Here the alleged fact that DuMont insisted on the release of Tracey's option as a condition precedent to the sale rests on statements by counsel in the district court and a statement in the notice of settlement. We note in passing that even those statements are ambiguous, being open to the construction that DuMont insisted on the release only as a condition precedent to the sale of the 40,000 shares under option to Tracey, not to the sale of the balance.
[7] In re Syracuse Stutz Co., Inc., 2 Cir., 55 F.2d 914, 917; In re National Public Service Corp., 2 Cir., 68 F.2d 859, 861; In re Adolf Gobel, Inc., 2 Cir., 80 F.2d 849, 853; Syracuse Engineering Co. v. Haight, 2 Cir., 97 F.2d 573, 575; Royal Petroleum Corp. v. Smith, 2 Cir., 127 F.2d 841, 843.
In Re Syracuse Stutz Co., supra [55 F.2d 917], we said: "In conclusion we wish to express our thorough disapproval of the manner in which this record on appeal is made up. Fully one-third of it embraces so-called `Minutes,' apparently a stenographic report of the colloquy between court and counsel at the hearing. Such a colloquy has no place in an equity record."
In Royal Petroleum Corp. v. Smith, supra [127 F.2d 843], we said: "If in the rambling discussion anything `essential' had appeared, it should have been selected and put in such form as to be comprehensible. We cannot undertake to grope our way through a heap of rubbish on the odd chance of picking up a bit of sound metal here and there."
[8] Cf. Adams v. Cowen, 177 U.S. 471, 484, 20 S. Ct. 668, 44 L. Ed. 851; Ingram v. Lewis, 10 Cir., 37 F.2d 259, 263, 70 A. L.R. 702; Comstock v. Herron, 6 Cir., 55 F. 803, 810.
[9] Thus, if we assume that, in connection with a renewed effort to procure approval of the settlements, it should satisfactorily be shown below that the individual defendants bought no Majestic shares from Automatic, then an issue as to lost business opportunity would arise. These defendants assert that in the district court enough has already been shown to raise ample doubt in their favor on that issue. We do not agree. All that was there shown was that Automatic and its affiliates already owned a very considerable block of Majestic stock. Defendants, in their petitions for rehearing, add a reference to Gluck v. Otis, 265 A.D. 244, 38 N.Y.S.2d 541; in the opinion in that case it appears that B. T. I. and affiliates in 1937 to 1939 had invested in securities, including some Majestic shares, and that these investments as a whole had been unprofitable; but the opinion does not disclose to what extent the Majestic shares shrank in value, and states that, by 1940, the investments had become profitable. Such facts alone we regard as insufficient to raise the needed doubt.
[10] Cf. Cohen v. Young, 6 Cir., 127 F.2d 721; Winkelman v. General Motors Corp., D.C., 48 F. Supp. 490, 496. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/8304512/ | OWEN, J.
Mrs. Jennie Boone, a citizen of Wynne, Cross county, Arkansas, is prosecuting a writ of error from a decree of the chancery court of Shelby county dismissing her bill.
Hereafter, in this opinion, we will refer to Mrs. Jennie Boone as complainant and Mrs. Florence E. Boone as defendant.
The defendant is a resident of Memphis, Tennessee. The defendant is the administratrix of the estate of J. N. Boone, deceased, having been appointed by the probate court of Shelby county, Tennessee. J. N. Boone was the son of the complainant and the husband of the defendant. J. N. Boone married the defendant the 22nd of December, 1916, at' 327 McLemore avenue, in Memphis, Tennessee. The defendant was a citizen of Tennessee ■at the time she married J. N. Boone. J. N. Boone was about forty-three years of age at the time he married, having never been married prior to his intermarriage with the defendant. J. N. Boone lived in Wynne, Cross county, Arkansas, from the time of his birth until his marriage. He died on the 17th of November, 1923, in a hospital in Fort Smith, Arkansas. J. N. Boone’s father was named Daniel Boone. He had died some years prior to J. N. Boone’s marriage. After- the death of J. N. Boone, his body was removed from Ft. Smith, to Wynne, Arkansas, and buried in a cemetery in which we presume his father was buried. J. N. Boone left some real estate, worth about $2000, consisting of two houses in Wynne, Arkansas, and he had personal property consisting of cash and certificates of time deposits issued by various banks of Memphis, Tennessee, amounting to something over $27,000.
Under the laws of Arkansas, if J'. N. Boone’s domicile was in Arkansas this personal property would descend, one-half to the complainant and one-half to the defendant; under the laws of Tennessee, if J. N. Boone was a citizen of Tennessee and his domicile was in Memphis, all the personal property would pass to the widow ■(the defendant). •
Complainant filed her bill to recover one-half of the personal estate on the ground that her son’s home and domicile was in Wynne, Arkansas, at the time of his death. The' widow denied this contention and insisted that his domicile was Memphis, Tennessee. With the issues thus formed numerous depositions were taken —more than fifty — the cause was submitted to Special Chancellor Lois Bejach, who in a written finding of facts decided that the *143evidence preponderated in favor of the defendant and complainant’s bill was dismissed. Within due time she excepted to the decree dismissing her bill, prayed and was granted an appeal but did not perfect the same, but within proper time filed a transcript in this court Eor error. She has assigned numerous errors in this court but it is not necessary to set out the assignments of error in this opinion. They raise but one question, and that is, was the court in error in holding that J. N. Boone was a citizen and had his domicile in Memphis, Tennessee.
It has been said of the Greek poet Homer,- during his life no city claimed him and he had no home while living, but after his death seven cities claimed Homer as a citizen. We do not have seven cities claiming J. N. Boone as a citizen but we have two claimants, each with witnesses /to substantiate their claims — one claiming he was a citizen of Arkansas, domiciled at Wynne, and another claiming he was a citizen of Tennessee, domiciled at Memphis. In addition to these claims, J. N. Boone had a number of temporary homes or residences for several months at the time. At the time of his marriage he was a traveling salesman, for a drug house fir Paducah, Kentucky. He represented this concern for a number of years. Shortly after his marriage the Paducah concern was purchased by the Paris Medicine Company of St. Louis, Missouri, and this concern employed J. N. Boone as a salesman. During his married life he was assigned by his house to various territories and he represented his employer in South Carolina, Florida, Oklahoma, Kansas, Missouri, Arkansas and Kentucky. At the time of the marriage of J. N. Boone and the defendant, she was renting rooms from a Mrs. Parker at 327 McLemore avenue, Memphis, Tennessee, where the marriage ceremony was performed. It appears that, after their marriage, Boone would leave his rooms in Memphis oftentimes, would be accompanied by his wife and they would go into various territories assigned them and there have temporary headquarters. Sometimes they would board for several months in towns in South Carolina, Oklahoma, Florida and other states and Boone would spend the week ends with his wife in these various temporary boarding places or apartments. It appears that J. N. Boone built a home in Wynne, Arkansas, while he was single and had his father and mother to move from the country to live with him, or he lived with his father and mother. The defendant owned a home in Wynne, Arkansas, and she had furniture stored in this home during her married life to J. N. Boone. J. N. Boone returned about twice a year to visit his mother and other relatives in Wynne. It appears that he had four brothers living in Arkansas. The defendant also ■ had a grandmother and a number of other relatives in Wynne. During certain seasons of *144the year J. N. Boone and his wife would send clothing to the complainant, asking her to keep same for them until the defendant and her husband needed the clothes. In warm weather they would send their winter clothing to the complainant and when the seasons changed they would send summer wearing apparel and have their winter clothes sent to them. As J. N. Boone wrote to his mother (and it appears she was very dear to him) he gave expressions to Wynne being his home; such expressions as, "I am coming home” or "I expect to come home.” On the other hand we find that after he located in Memphis he had all of his mail sent to Memphis, transferred his money from Arkansas banks to Memphis banks; that he procured an identification card from the Travelers Protective Association' and gave 327 McLemore avenue as his home. lie tried to buy three different homes in Memphis, two of them being near 327 McLemore avenue and carried on negotiations with the owners of these places. In one instance he could not agree on the price and for this reason the trade was not consummated, but he expressed to numerous people in Memphis that Memphis was his home and he expected to quit traveling and open a drug store or go into the drug business in Memphis. He informed the bankers with whom he did business in Memphis that Memphis was his home. It appears that while Mrs. Boone was accompanying her husband on one of his trips into South Carolina she became ill and was treated for ten days or more by a physician. This physician testifies that J. N. Boone told him that his residence was in Memphis. They had numerous conversations during their acquaintance. Other witnesses from Charleston, South' /Carolina, testify as to J. N. Boone stating that he lived in Memphis, Tennessee; that it was his permanent home. A witness with whom the defendant and her husband lived for a few weeks in Florida testified that J. N. Boone showed him a picture- of the home that he (Boone) owned in Wynne, Arkansas, and said, in substance, it was the place he owned; that it was occupied by his mother; that his home was in Memphis, Tennessee. These facts are corroborated by witnesses with whom the defendant and her husband boarded with and lived with in Oklahoma City and Wichita, Kansas. Boone told the physician who treated him in his last illness in Fort Smith, Arkansas, that his home was in Memphis, Tennessee. This physician advised him to write a will, and he stated that a will was unnecessary that his wife would get all that he had. When he entered the hospital he gave his permanent address as 327 Mc-Lemore avenue. Mrs. Boone was treated by a physician in Oklahoma City, and J. N. Boone and Mrs. Boone at that time, something like a year before his death, stated that their permanent home was in Memphis, Tennessee; He owned an automobile which *145be purchased a few months before his death and his application for license stated his address was 327 MeLemore avenue.
We are of opinion from the weight of the evidence that J. N. Boone was once domiciled in Cross county, Arkansas, but that he changed his domicile to Memphis, Tennessee. This question is not free from doubt, there is considerable conflict in the evidence, but after a careful and thorough examination of all the evidence, taking into consideration the witnesses who are interested by kinship and friendship, and those who are without any interest whatever in the result of this cause, we are constrained to hold, as a fact, that the deceased J. N. Boone was a citizen of Memphis, Tennessee, at the time of his death and that Memphis was his domicile.
A man may have two or more residences but only one domicile or legal residence. He must have a domicile somewhere; he can only have one; therefore, in order to lose one he must acquire another. Domicile and residence are not synonymous terms in the law relating to the situs for taxes. Domicile imports a legation relation issuing between a person ahd a particular place, based on actual residence, plus a concurrent intention there to remain as at a fixed abiding place. The law will, from facts and circumstances, fix a legal residence fór him, unless he voluntarily fixes it himself, and when a legál residence is once fixed it requires both fact and intention to change it. As contra-distinguished from a legal residence, he may have an actual residence in another state or county. He may abide in the latter without surrendering his legal residence in the former, provided he so intends.
There is no proof that J. N. Boone ever voted after his marriage. We infer that he did not. He had a brother who was a candidate for tax assessor shortly after his marriage. It appears that J. N. Boone returned to Wynne in behalf of his brother’s candidacy and solicited some of the electors to vote for his brother. One witness said that J. N. Boone gave him a cigar while he was electioneering with him in behalf of candidate Boone. The defendant testified that her husband would not vote' in that election for his brother. She states that she knows this as a fact and there is no proof offered that he did vote. However, this race was shortly after' his marriage and it appears that about four years later the same brother made the race for sheriff, and there is no proof to show that J. N. Boone came into Cross county at the time of the sheriff’s race to render assistance or aid to his brother’s candidacy.
It results that all of the assignments of error are overruled, the writ of error is dismissed and the judgment of the lower court is affirmed.
*146Complainant and her surety on the writ of error bond will pay all the cost of the cause, for which execution will issue.
Senter and Heiskell, JJ., concur. | 01-03-2023 | 10-17-2022 |
https://www.courtlistener.com/api/rest/v3/opinions/1563875/ | 16 So. 3d 135 (2009)
COOK
v.
STATE.
No. 2D08-3456.
District Court of Appeal of Florida, Second District.
July 10, 2009.
Decision without published opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563879/ | 16 So. 3d 824 (2009)
BOWMAN
v.
STATE.
No. 2D09-924.
District Court of Appeal of Florida, Second District.
September 11, 2009.
Decision without published opinion Appeal dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563856/ | 558 S.W.2d 933 (1977)
William MARLOW et ux., Appellants,
v.
Cynthia MEDLIN, Appellee.
No. 5775.
Court of Civil Appeals of Texas, Waco.
November 17, 1977.
*935 Herbert E. Evans, Austin, for appellants.
J. Terry Weeks, Levbarg, Weeks & Chapman, Austin, for appellee.
HALL, Justice.
This is a common law fraud action for actual and exemplary damages brought by Cynthia Medlin against William Marlow and wife Elli Marlow as partners. The gist of plaintiff's suit was that her landlords were defendants' vendees under a contract of sale of the premises she was renting, and that she was induced by defendants' false representations to pay defendants rent money she was withholding from her landlords as an offset against a debt they owed to her. Defendants answered with a general denial, several special pleas, and a counterclaim for unpaid rent. After a hearing without a jury, judgment was rendered awarding plaintiff actual and exemplary damages, and denying defendants recovery on their counterclaim. Defendants appeal. We affirm the awards of damages on plaintiff's action, but we reform the judgment to allow defendants recovery on their counterclaim.
On July 3, 1973, defendants sold a duplex-type house and lot located in the City of Austin, Texas, to Tom Kosowski and Mike Vogel under a written contract of purchase and sale. The terms of the contract called for a total price of $41,600.00, a down payment of $4,000.00, payment of the balance in monthly installments of $400.00, and execution by defendants of a general warranty deed to the purchasers upon payment of the entire purchase price. The monthly payments were payable to defendants at Silver Lake, Indiana. Although the contract provided that if the purchasers breached its terms defendants would be authorized to terminate the contract and retain all money paid by the purchasers as rental and liquidated damages, nothing was stated in it concerning the parties' rights to rent paid by tenants of the property. However, the language of the whole instrument (which we need not set forth) clearly evidenced an intention that the purchasers should have possession of the premises. On the day the contract of sale was executed, Kosowski and Vogel borrowed $2,700.00 from plaintiff, executed their promissory note to plaintiff for the loan, and used the borrowed money in making the $4,000.00 down payment to defendants. The note from Kosowski and Vogel to plaintiff called for full repayment of the loan by January 1, 1974, with 9% interest.
Within a few days after execution of the contract of sale and the note in July, 1973, plaintiff, who was a student at the University of Texas at Austin, leased the house from Kosowski and Vogel at a rental of $175.00 per month. She also managed the premises in an informal fashion, collected rent from other tenants, and deposited it with her own rent in Kosowski's and Vogel's bank account. Kosowski and Vogel never made any payment of either interest *936 or principal on plaintiff's note, and in August, 1974, plaintiff determined to withhold her rent from them. She did so for the months of September, October, and November, 1974. By this time, Kosowski and Vogel were in default on their payments to defendants under the contract of sale.
Plaintiff testified that defendant William Marlow telephoned her twice in the month of November, 1974. Her account of their conversation is as follows:
"[On the first call] Mr. Marlow wanted to know what happened, what had happened to Mr. Vogel and Mr. Kosowski and why he hadn't been receiving the full amount of house payments from them. I speculated as to why I thought that he was not receiving that money, and one of the things I told him was that I was withholding my rent from them because they had not attempted to repay my loan. And he became very angry with me and told me I had no right to do that; that it wasn't my money, that it wasn'twell, it wasn't my money to keep. That it was his money and I was stealing from him if I was withholding the rent, and I told him I did not believe that was so because I was not renting from him, and I was renting from [Kosowski and Vogel]. He was very insulted that I was doing it to him, and I told him I was not doing it to him but I was doing it to [Kosowski and Vogel]. He became very angry with me and told melike I said, he told me I had no right to do that and he said I was stealing from him and he was going to call his attorney and find out what he could do about it, and then he said he would call me back. In a few days to two weeks, I am not sure how long it was, he called me back and he told me that he had checked with his attorney and I had no right to that money; that I was stealing it and that he would call the Sheriff, and I hadhe wanted, he wanted me to send the money to him instead of withholding it from Vogel and Kosowski. He said that if I didn't send it that he could get me in trouble, that he would call the Sheriff. After that last conversation, I sent him the money. If it were not for those conversations I would not have sent him the money. I sent it then because I was afraid not to."
Plaintiff's brother resided with her in the leased premises. He testified, "Cynthia informed me of the first conversation. She was very upset and scared over it, and she asked me to listen in on the second conversation. I did." He gave this account of Mr. Marlow's attitude and statements:
"Mr. Marlow was very upset, very indignant. Insulted my sister profusely and insulted me, my sister, and the other people in the house in general. Was very flagrant and inflammatory toward Michael Vogel and Thomas Kosowski and proceeded to tell Cynthia, my sister, that if she did not send him the money that she had been withholding for rent against Mike Vogel and Thomas Kosowski, that if she did not send the money that he would have the Sheriff come out and arrest her, that he had his lawyer to check into the legality of it, and that she was stealing his money. After the conversation was completed Cynthia was very upset, very scared. She was in tears, and being very scared she went ahead and sent the money."
On December 2nd, after the conversations, plaintiff mailed defendants $476.44, stating in her letter of transmittal that this sum was the rent for the months of September, October, and November, 1974, at the rate of $175.00 per month, less $48.56 paid by her for a water bill which Kosowski and Vogel should have paid.
Mr. Marlow denied that he told plaintiff to pay the rent she was withholding to him.
On December 27, 1974, defendants rescinded the contract of sale, notified Kosowski and Vogel that they had done so, and caused an instrument reflecting those facts to be filed in the deed records of Travis County, Texas.
*937 Plaintiff continued living in the house until March 20, 1975, when she was judicially evicted under a forcible detainer action filed by defendants in the Justice Court of Travis County. During this time she paid only $175.00 for rent. This payment was voluntarily made by her to defendants in January, 1975. She testified that this was a "good-faith gesture" on her part when they were discussing the possibility of her purchase of the property.
The trial court made and filed the following findings of fact and conclusions of law:
"FINDINGS OF FACT
"1. In December, 1974, Cynthia Medlin was a tenant of Tom Kosowski and Mike Vogel at 3111 Hemphill Park, Austin, Texas. At that time Vogel and Kosowski were owners of 3111 Hemphill Park under a Contract of Sale from the Defendants William and Elli Marlow.
"2. Cynthia Medlin had advanced Kosowski $2,700.00 which was used as part of the down payment for the purchase of 3111 Hemphill Park by Vogel and Kosowski from the Marlows. The Marlows knew that Cynthia Medlin had advanced Kosowski this money for this purpose.
"3. Vogel and Kosowski executed a promissory note to Cynthia Medlin for the money she had loaned them.
"4. Vogel and Kosowski defaulted on their payments to Cynthia Medlin on the promissory note, and Cynthia Medlin withheld her rent payments from Vogel and Kosowski as an offset against the Vogel and Kosowski note.
"5. The Marlows learned that Cynthia Medlin was withholding rent from Vogel and Kosowski. William Marlow told Cynthia Medlin that the rent she was withholding belonged to him since Vogel and Kosowski had also defaulted on their obligation to the Marlows on the Contract of Sale.
"6. William Marlow falsely represented to Cynthia Medlin that she had no right to the money she was holding, that her holding the money was tantamount to theft from the Marlows, that he had consulted a lawyer about the matter and that he could send the Sheriff to get her.
"7. The false statements by William Marlow were intentionally made to Cynthia Medlin for the purpose of getting $476.44 which Cynthia Medlin had withheld from Vogel and Kosowski. Cynthia Medlin believed that she could be arrested as William Marlow had threatened. The false statements by William Marlow were material, and because of her reliance on these material false statements, Cynthia Medlin turned over the $476.44 to the Marlows.
"8. Cynthia Medlin's reasonable and necessary attorney's fees in this cause are $1,500.00."
"CONCLUSIONS OF LAW
"1. The acts of the Defendants constituted fraud against Cynthia Medlin.
"2. Cynthia Medlin is entitled to $476.44 as actual damages resulting from this fraud and $750.00 as exemplary damages.
"3. Cynthia Medlin is entitled to $200.00 as her reasonable attorney's fee for the securing of the Order of this Court whereby the Defendants were Ordered to appear for oral depositions.
"4. William Marlow had no greater right to the money than Cynthia Medlin."
Judgment was rendered awarding plaintiff $476.44 actual damages and $750.00 exemplary damages on her fraud claim. Defendants were denied any recovery on their counterclaim.
Plaintiff was also awarded $200.00 as reasonable attorney's fees for securing an order requiring defendants to appear for depositions, but this award is not questioned on this appeal.
Defendants assert that plaintiff did not establish that any representation made by them was false, or that plaintiff suffered injury. We disagree. The purchaser *938 under an executory contract of sale who goes into possession is entitled to all lease or rental money not reserved to the vendor by agreement of the parties. Robinson v. Smith, 130 S.W.2d 381, 384 (Tex. Civ.App.Waco 1939, writ ref.); Dallas Joint Stock Land Bank v. Lancaster, 91 S.W.2d 890, 891 (Tex.Civ.App.Waco 1936, no writ); F. Groos & Co. v. Chittim, 100 S.W. 1006, 1012 (Tex.Civ.App.1907, no writ); 35 Tex.Jur.2d 643, Landlord And Tenant, § 138; 58 Tex.Jur.2d 470, Vendor And Purchaser, § 250. This rule applies even if the vendee is in default on the contract, so long as the contract is in force. 35 Tex.Jur.2d 641, Landlord And Tenant, § 137. This is because of the remedies available to the seller who may, upon the purchaser's default, affirm the contract and sue for damages or for specific performance, or rescind the contract.
In our case, Kosowski and Vogel, in possession of the property under the executory contract of sale, were entitled to the rents until the contract was rescinded by defendants on December 27, 1974. If plaintiff had paid the rent in question to Kosowski and Vogel, defendants could not have compelled her to repay it to them. See Jones v. Hutchinson, 21 Tex. 370, 376-77 (1858). Defendants' representations to plaintiff that the rent money was "their money" and that they were entitled to receive it were, accordingly, false.
Defendants' statement to plaintiff that she had no right to withhold the rent was also false. The tenant is entitled to set off a debt owing to him by the landlord against the landlord's claim for rent. Walker v. Amberg, 284 S.W. 334, 335 (Tex. Civ.App.Austin 1926, no writ); Harris v. McGuffey, 185 S.W. 1024 (Tex.Civ.App. Texarkana 1916, no writ); 35 Tex.Jur.2d 653, Landlord And Tenant, § 145. When plaintiff was induced by defendants to pay the rent to them, she lost the opportunity to offset it against her landlords' debt to her and was thereby damaged in that amount.
Defendants contend that the court's findings do not support the award of exemplary damages because there were no findings that defendants intended to deceive, defraud or injure plaintiff; and that, in any event, the evidence does not support such findings. These contentions are overruled.
The evidence that defendants were abusive and insulting toward plaintiff, accused her of stealing, and threatened her with arrest when the misrepresentations were made supports an implied finding that defendants acted willfully and maliciously. A finding on this question was not requested by plaintiff or defendants. Under our record, which contains express findings on other elements of plaintiff's fraud action, the omitted, unrequested finding that defendants acted with malice is "supplied by presumption in support of the judgment." Rule 299, Vernon's Tex.Rules Civ.Proc.; Bednarz v. State, 142 Tex. 138, 176 S.W.2d 562, 563 (1944). In turn, this finding supports the award of exemplary damages. 17 Tex.Jur.2d 238, Damages, § 173.
Defendants urge that their representations to plaintiff were simply statements as to matters of law, and therefore will not support an action for fraud. We reject this argument. The general rule is that fraud cannot be predicated upon misrepresentations as to matters of law. The reason usually given for the rule is that everyone is presumed to know the law, and hence has no right to rely upon such representations made to him by another, and that the representations are to be treated as mere statements of opinion and not of fact. "But it is equally well settled that misrepresentations involving a point of law will be held actionable misrepresentations of fact if it appears that they were so intended and understood." Safety Casualty Co. v. McGee, 133 Tex. 233, 127 S.W.2d 176, 178 (Tex.Comm.App.1939, opinion adopted). The facts of our case fall within this latter rule. The record shows that defendants had been engaged for many years in the business of buying and selling and leasing properties. Defendants knew that plaintiff was a college student and a tenant of the *939 premises under Kosowski and Vogel. Plaintiff knew that Kosowski and Vogel were delinquent on their payments to defendants under the contract of purchase. Defendants' misrepresentations to plaintiff as to their right to the rent money and their remedy against her if she withheld it from them were made in an overbearing, threatening manner, assertedly after consultation with legal counsel on the subject. The trial court, as trier of the facts, was justified in believing and finding that defendants' statements were intended by them as representations of fact and were so understood by plaintiff.
As we have said, plaintiff remained in the house until she was evicted on March 20, 1975. The evidence shows without contradiction that a reasonable rental for the house was $175.00 per month. It also shows without dispute that plaintiff voluntarily paid defendants $175.00 for rent in January, 1975. She testified that this was for the January rent. But plaintiff admitted that she did not pay rent in December, 1974, or in February and March, 1975, to anyone. In their counterclaim, defendants asserted they were entitled to three months' renteither for the months of December, 1974, and February and March, 1975, or for the months of January, February, and March, 1975. However, as we have already held, Kosowski and Vogel were entitled to the rent until the contract of sale was rescinded by defendants on December 27, 1974. And, until the rescission, plaintiff had the right to set off her rental payments against the debt owed to her by Kosowski and Vogel. Defendants were entitled to the rent from plaintiff for only the months of January, February, and March, 1975. They have received the January rent. Accordingly, the maximum allowable recovery under their counterclaim would be $350.00.
Plaintiff's defense to defendants' counterclaim was the plea of res judicata on the theory that defendants' right to rent was adjudicated in the Justice Court with defendants' forcible detainer action. Without detailing the proof on this question, we hold that it is legally insufficient to support plaintiff's plea.
The trial court's awards of damages to plaintiff on her fraud action were proper. However, defendants should have been allowed a recovery of $350.00 on their counterclaim. The judgment is reformed to provide for this recovery by defendants. Reformed, the judgment is affirmed.
The costs of the trial and this appeal are assessed 75% against defendants and 25% against plaintiff. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563858/ | 960 A.2d 1268 (2008)
LAKESIDE LODGE, INC.
v.
TOWN OF NEW LONDON.
No. 2008-247.
Supreme Court of New Hampshire.
Argued: October 15, 2008.
Opinion Issued: December 5, 2008.
*1269 Orr & Reno, P.A., of Concord (James P. Bassett and Jeffrey C. Spear, on the brief, and Mr. Bassett orally), for the petitioner.
Upton & Hatfield, LLP, of Concord (Barton L. Mayer, on the brief and orally), for the respondent.
HICKS, J.
The petitioner, Lakeside Lodge, Inc. (Lakeside), appeals an order of the Superior Court (Abramson, J.) affirming a boat use limit on Lakeside's Lake Sunapee dock, imposed by the Town of New London Zoning Board of Adjustment (ZBA). We hold that state law and regulations preempt the regulation imposed by the ZBA, and reverse.
The record supports the following relevant facts. Lakeside owns property in New London on Lake Sunapee's waterfront. The property includes a private dock which has been used by Lakeside's owners since at least the 1980s.
The respondent, Town of New London (Town), enacted a zoning ordinance in 1991 (the 1991 ordinance) designating Lakeside's lot within a "Shore Land Overlay District." See New London, N.H., Rev. Ordinances art. XVI (amended 2006). The ordinance prohibits the use of waterfront "common areas" for lake access except in compliance with its provisions and with planning board approval. Id. § D(3). A "common area" is defined as one "used by a group of [three] or more unrelated persons or by an association, club or organization consisting of [three] or more members." Id. The ordinance also states that "[a]ny use of a common area ... for business or commercial purposes shall be subject to" special exception. Id. § E(3).
After receiving approval from the New Hampshire Department of Environmental Services (DES), Lakeside completed substantial dock repairs in 1995. The Town maintains that Lakeside's use intensified after these renovations.
In 2002, the Town asserted that the use of Lakeside's dock by multiple, unrelated persons violated the 1991 ordinance. Lakeside maintained that such use predated *1270 the 1991 ordinance, and applied to the New London Board of Selectmen (Selectmen) for an exemption, asserting that eleven users secured fifteen boats prior to the 1991 ordinance. The Selectmen determined that no preexisting, nonconforming use existed.
Lakeside appealed and the ZBA ultimately reversed, concluding that at least four users predated the enactment of the 1991 ordinance. The Selectmen issued a ruling interpreting the ZBA's decision to permit three owners and one non-owner to use the dock. The abutters sought to enforce this ruling in 2004 but the Selectmen declined, citing the lack of clarity from the ZBA as to how to proceed. The abutters appealed to the ZBA for clarification.
In 2007, the ZBA ruled that, because use by Lakeside's three owners predated the 1991 ordinance and because users typically invite guests, "there may be no more than six (6) users and six (6) boats at the dock at any one time." The ZBA intimated that renting dock space exceeded the scope of the "personal" use asserted by Lakeside's three owners. The superior court affirmed.
On appeal, Lakeside raises several arguments, but we need address only the preemption issue.
"Our review of zoning board decisions is limited." Guy v. Town of Temple, 157 N.H. ___, ___, 956 A.2d 272, 279 (2008). We will uphold the trial court's decision unless the evidence does not support it or it is legally erroneous. Id.
Lakeside argues that the Town's application of the 1991 ordinance is unlawful because the legislature has preempted local regulation of private dock use for boat storage on Lake Sunapee. Lakeside points to RSA chapter 482-A, which it characterizes as a comprehensive regulatory scheme governing the design and placement of docks over State-owned waters to achieve the State's goal of uniform regulation. Additionally, it argues that the State's permission to repair the dock in 1995 conflicts with local regulation restricting use of the renovated dock.
The Town argues that the State regulates only the construction of private docks, leaving to the Town the authority to regulate their use as extensions of the land. It maintains that dock users must cross the shorefront property to access the dock. It asserts its interest in the availability of parking and bathrooms in addition to its authority to promote environmental ends. It cites our holdings permitting municipalities to create more restrictive rules than the State. Finally, it argues that, by defining "wetlands" within RSA 674:55 (2008), the legislature intended to share concurrent regulatory authority over wetlands regulation.
The trial court ruled that the six-user, six-boat restriction was within the ZBA's authority, citing RSA 47:17, VII (2003) and our decision in Gray v. Seidel, 143 N.H. 327, 726 A.2d 1283 (1999). We disagree.
We are the final arbiter of the meaning of a statute as expressed by the words of the statute itself. Weare Land Use Assoc. v. Town of Weare, 153 N.H. 510, 511, 899 A.2d 255 (2006). "The state preemption issue is essentially one of statutory interpretation and construction whether local authority to regulate under a zoning enabling act is preempted by state law or policy." N. Country Envtl. Servs. v. Town of Bethlehem, 150 N.H. 606, 611, 843 A.2d 949 (2004) (quotation and ellipsis omitted). "Preemption may be express or implied." Id. "State law preempts local law ... when there is an actual conflict between State and local regulation." Id. "A conflict exists when a municipal ordinance or regulation permits that which a *1271 State statute prohibits or vice versa." Id. In addition, State law may preempt local regulation if such regulation "frustrates the statute's purpose," or "[t]he very nature of the regulated subject matter ... demand[s] exclusive state regulation to achieve the uniformity necessary to serve the state's purpose or interest." Id. (quotation omitted).
The State has delegated to municipalities authority to "regulate and restrict" certain land uses. RSA 674:16 (2008). An overlay district, such as that created by the 1991 ordinance, is one "that is superimposed over one or more zoning districts... and ... imposes specified requirements... in addition to those otherwise applicable for the underlying zone." 10 P. Rohan, Zoning and Land Use Controls § 53C.08[2][a], at 53C-444.90 (2008); see, e.g., Brewster v. Town of Amherst, 144 N.H. 364, 365, 742 A.2d 121 (1999). "Where the state has not preempted the area, a municipality may zone to protect its shorelines...." 2 K. Young, Anderson's American Law of Zoning § 9:13, at 144 (4th ed. 1996).
The parties and proceedings below assumed that a nonconforming personal use predated the 1991 ordinance. Thus, our inquiry is limited to whether the local attempt to restrict personal use of Lakeside's dock is permissible. See Cherry v. Town of Hampton Falls, 150 N.H. 720, 725, 846 A.2d 508 (2004).
The use of lakes of ten or more acres, such as Lake Sunapee, is controlled by the State, which holds these "valuable resources," RSA 483-B:1, II (2003), in trust for public use. See RSA 271:20, I (1999); RSA 483-B:1, II (The State has the "jurisdiction to control the use of the public waters and the adjacent shoreland for the greatest public benefit."). The State is the exclusive steward of public trust rights, a bundle of "all useful and lawful purposes," State v. Sunapee Dam Co., 70 N.H. 458, 460, 50 A. 108 (1900), such as the common law right to boat recreationally, see Hartford v. Gilmanton, 101 N.H. 424, 425-26, 146 A.2d 851 (1958). See generally 6 Waters and Water Rights 801-12 (Robert E. Beck ed., 1991, 2005 repl. vol.); Annotation, Rights of Fishing, Boating, Bathing, or the Like in Inland Lakes, 57 A.L.R. 2d 569, 577-78 (1958).
Numerous statutes regulate the right to boat. See RSA ch. 233-A (1993 & Supp. 2008) ("Access to Public Waters"); RSA ch. 270 (1999 & Supp.2008) ("Supervision of Navigation; Registration of Boats and Motors; Common Carriers by Water"); RSA ch. 270-A (1999) ("Use of Houseboats"); RSA ch. 270-(1999) ("Abandoned Boats"); RSA ch. 270-D (1999 & Supp. 2008) ("Boating and Water Safety on New Hampshire Public Waters"); RSA ch. 485 (2001 & Supp.2008) ("New Hampshire Safe Drinking Water Act"); RSA ch. 485-A (2001 & Supp.2008) ("Water Pollution and Waste Disposal"); RSA ch. 487 (2001 & Supp.2008) ("Control of Marine Pollution and Aquatic Growth"). This broad statutory framework is intended to safeguard public waters "in light of the fact that competing uses for the enjoyment of these waters, if not regulated for the benefit of all users, may diminish the value to be derived from them." RSA 270:1, II (1999).
As the steward of public waters, the State safeguards the right to use and enjoy public waters by avoiding piecemeal on-water regulation. See Opinion of the Attorney General, No. 0-87-067 (August 2, 1989) (public trust doctrine imposes limits upon municipality's use of public waters); see also RSA 483-B:1, II, IV (2001) (asserting State's "interest in protecting [the public waters of New Hampshire]" and seeking to avoid "uncoordinated, unplanned and piecemeal development along the state's shorelines"); RSA 482-A:14-b, *1272 II (2001) (allowing municipality to petition superior court for enforcement as the remedy for violations of RSA chapter 482-A, and requiring notice of such petition to the attorney general and the DES commissioner, "who may take such steps as they deem necessary to ensure uniform statewide enforcement"). Nowhere is the peremptory judgment of the legislature better expressed than in RSA chapter 483-A, creating the Lakes Management Protection Program (LMPP) and ordering the "develop[ment of] detailed guidelines for coordinated lake management and shoreland protection plans together with recommendations for implementation." RSA 483-A:7, I (Supp.2008).
In addition to enjoying the common law right to boat recreationally in Lake Sunapee, Lakeside appears to own the littoral rights accompanying its waterfront lot. "Littoral rights are incidental property rights associated with ownership of lakeshore property." Donaghey v. Croteau, 119 N.H. 320, 323, 401 A.2d 1081 (1979). While the State holds title to the bed of the great ponds, State v. Stafford Company, 99 N.H. 92, 97, 105 A.2d 569 (1954), "littoral owners have rights which are more extensive than those of the public generally." Sundell v. Town of New London, 119 N.H. 839, 844, 409 A.2d 1315 (1979) (quotation omitted). "These ... include... the right to use and occupy the waters adjacent to their shore for a variety of recreational purposes...." Id.; see also Stafford Company, 99 N.H. at 97, 105 A.2d 569. Such littoral rights, however, "are always subject to the paramount right of the State to control them reasonably in the interests of navigation, water storage and classification, health and other public purposes." Stafford Company, 99 N.H. at 97, 105 A.2d 569; see also RSA 483-A:3 (2001).
Against this backdrop we first observe that, by expressly permitting Lakeside to repair its dock in 1995, the State has placed its imprimatur upon the use of Lakeside's dock for personal boating. Presumably, the Town received notice of its opportunity to participate in this process. See RSA 482-A:3, I (Supp.2008). Construction connotes use. Construction of docks on public waters is prohibited without a DES permit. See RSA 482-A:3, I(a) (Supp.2008); RSA 483-B:9, II(c) (Supp.2008). RSA chapter 482-A prescribes detailed siting and construction requirements. See RSA 482-A:3, XIII (2001). The DES administrative rules prescribe additional restrictions. See N.H. Admin. Rules, Env-Wt 402.01 ("Configuration"), 402.02 ("Navigation Space"), 402.03 ("Dimensions"), 402.04 ("Setbacks").
Importantly, the administrative regulations prescribe frontage requirements per "boating slip" for lots with more than seventy-five feet of shoreline frontage in order
[t]o lessen congestion, improve public safety and navigation, protect neighboring property values, provide sufficient area for construction of facilities, provide adequate area for boat maneuvering, and protect health, safety and general welfare.
N.H. Admin. Rules, Env-Wt 402.13 (emphases added); cf. N.H. Admin. Rules, Env-Wt 402.12 (applicable to lots with less than seventy-five feet of frontage).
We find implicit within the permission to repair its dock the right to use the entire repaired dock for personal boating and boat dockinga clear exercise of its common law and littoral rights. Cf. N. Country Envtl. Servs., 150 N.H. at 615, 843 A.2d 949 (holding that RSA chapter 149-M preempted local regulation because the regulatory regime sought to achieve broad goals, delegated power to DES and prescribed *1273 detailed "design, construction, operation and closure" standards for facilities); Wasserman v. City of Lebanon, 124 N.H. 538, 543, 474 A.2d 994 (1984) (ordinance preventing reconstruction of dam preempted by state law); 6 Rohan, supra § 36.02[1][b], at 36-27 ("A municipality may not ... prohibit a use expressly permitted by state statute.").
The statutory scheme regulating the "mooring" of watercraft further reveals the State's expectation that private dock users will make use of the entire dock for personal boating and docking. See RSA 270:59-:72 (1999 & Supp.2008). The provisions of RSA chapter 270 are intended to "maintain[] jurisdiction to control the use of public waters for the greatest public benefit," RSA 270:60, I(a) (1999), by curtailing the "undue proliferation of moorings," RSA 270:60, I(c) (1999). The department of safety is charged with issuing mooring permits on Lake Sunapee. See RSA 270:61, I (Supp.2008); see also N.H. Admin. Rules, Saf-C 408.04. Individual mooring permit applications require the applicant to list the length and width of existing docking structures together with the number of boating slips and explain why they are insufficient to meet the user's need. See N.H. Admin. Rules, Saf-C 408.05(a)(1), 408.06(b)(12)-(13), (15)(d)(1). These provisions impel private dock users to exhaust available watercraft storage before seeking a mooring permit.
The Town argues that RSA 674:21, I(j) (2008) allows additional municipal regulation of Lakeside's private dock. We disagree. See JTR Colebrook v. Town of Colebrook, 149 N.H. 767, 770-72, 829 A.2d 1089 (2003); 3 A.H. Rathkopf et al., Rathkopf's The Law of Zoning and Planning § 48:16, at 48-37 to -38 (2008) ("Local control and regulation of navigable waters within a state often is preempted by state law."). But cf. Cherry, 150 N.H. at 725, 846 A.2d 508 (declining to address validity of ordinance, but stating that DES permit does not prove compliance with ordinance and that "municipality is not estopped from creating more restrictive rules for wetlands issues than those required by the Wetlands Board" (quotation and brackets omitted)); Anderson v. Motorsports Holdings, 155 N.H. 491, 501, 926 A.2d 261 (2007) (quoting language from Cherry in rejecting due process argument). Although the ZBA has broad authority to act under RSA 674:33 (2008), see Ouellette v. Town of Kingston, 157 N.H. ___, ___, 956 A.2d 286, 292 (2008), it acted ultra vires by imposing the six-user, six-boat limit upon Lakeside.
Whether the ZBA acted with authority requires examination of whether the conditions on use within the 1991 ordinance apply to personal boating and boat docking. The six-user, six-boat limit was an attempt to define and/or reasonably restrict a grandfathered useone asserted only after the Town maintained that Lakeside had violated the provisions of the 1991 ordinance restricting the number of nonrelated waterfront lot users. Although we have expressly permitted a ZBA to define and constrain nonconforming uses, see Peabody v. Town of Windham, 142 N.H. 488, 492, 703 A.2d 886 (1997); Vlahos Realty Co. v. Little Boar's Head District, 101 N.H. 460, 464, 146 A.2d 257 (1958), such authority derives from, and is coextensive with, the authority to enact the underlying ordinance because nonconforming use is the byproduct of regulation. Cf. RSA 674:33, I(a) (zoning board has power to hear and decide appeals if error alleged "in the enforcement of any zoning ordinance adopted pursuant to RSA 674:16"); Peabody, 142 N.H. at 493, 703 A.2d 886 ("[T]he ultimate purpose of zoning regulations is to reduce nonconforming uses to conformity as quickly as possible.").
*1274 "It is well established in this State that cities and towns have only those powers which are granted to them by the legislature." Dugas v. Town of Conway, 125 N.H. 175, 181, 480 A.2d 71 (1984). The Town lacks specific legislative authority to infringe upon the right to boat. Such authority is necessary to enact on-water regulations within public waters. See Opinion of the Attorney General, supra (specific legislative authorization required if local municipality's action infringes upon public trust rights in bodies of water); 6 Waters and Water Rights, supra at 807 (legislative grant of authority required if municipality's action interferes with public trust rights); Erbsland v. Vecchiolla, 35 A.D.2d 564, 313 N.Y.S.2d 576, 578, appeal denied, 27 N.Y.2d 485, 315 N.Y.S.2d 1025, 263 N.E.2d 563 (1970) (holding that municipality's zoning power did not extend into navigable waters because they "are within the sole jurisdiction and control of the State of New York").
The Town enacted the 1991 ordinance by invoking RSA 674:21, I(j), a grant of authority to develop "innovative land use controls" to accomplish environmental objectives. See 15 P. Loughlin, New Hampshire Practice, Land Use Planning and Zoning § 15.07, at 89-90 (Supp.2007) (describing inception of innovative land use control legislation). By any measure, the boundaries of the Town's authority under RSA 674:21, I (2008) are not precisely drawn, see RSA 674:16, II (2008), but to say that the statute confers general authority incidental to shoreland protection to regulate personal boating and boat docking upon State-owned waters stretches its language beyond logic. See Weare Land Use Assoc., 153 N.H. at 511, 899 A.2d 255 ("We interpret a statute to lead to a reasonable result...."); JTR Colebrook, 149 N.H. at 771, 829 A.2d 1089.
Perhaps the clearest statutory grant of retained, local shoreland protection authority is found within the Comprehensive Shoreland Protection Act, RSA chapter 483-B, which sets the minimum standards for shoreland protection, see RSA 483-B:2 (2001), and permits municipalities to "adopt land use control ordinances ... which are more stringent." RSA 483-B:8, I (2001); see also N.H. Dep't of Envtl. Servs. v. Marino, 155 N.H. 709, 713-17, 928 A.2d 818 (2007) (discussing and upholding constitutionality of RSA chapter 483-B). RSA chapter 483-B, however, lacks any provisions regulating the use of docks for boating or boat docking as part of shoreland protection. See RSA ch. 483-B (2001 & Supp.2008). "Had the legislature intended to permit municipalities to enact [such regulations], it could have explicitly done so." JTR Colebrook, 149 N.H. at 771-72, 829 A.2d 1089.
The DES guidelines state that "only the federal ... and state ... government[s] ha[ve] the authority to impose on-lake regulations" upon State-owned public water and that dock and mooring regulations are considered "on-lake" management. The N.H. Guidelines for Coordinated Lake Mgmt. and Shoreland Prot. Plans 53-54 (DES 2008), available at http://des.nh.gov/organization/ commissioner/pip/publications/wd/ documents/nhdes-wd-08-8.pdf. Indeed, vesting localities with broad authority to enact piecemeal on-water regulation of recreational boating and boat docking would threaten the State's need and desire for uniform regulation, which is expressly manifested within the broader statutory scheme governing regulation of public waters. "The legislature will not be presumed to pass an act ... nullifying, to an appreciable extent, the purpose of the statute." Weare Land Use Assoc., 153 N.H. at 511-12, 899 A.2d 255; Erbsland, 313 *1275 N.Y.S.2d at 578 (allowing municipality to regulate navigable waters owned by the state "would have the effect of nullifying rights which the State has the authority to grant"); 6 Rohan, supra § 36.02[1][a], at 36-25 ("[M]unicipal zoning ordinances cannot frustrate the purpose or implementation of a general or special law enacted by the state legislature."); 3 Rathkopf, supra at 48-37 ("[L]ocal regulation of wharves... may not be exercised contrary to state statutory provisions or policy.").
RSA 47:17, VII, relied upon by the trial court in rejecting Lakeside's preemption argument, grants towns only the authority to regulate public docks. See RSA 47:17, VII; Gray, 143 N.H. at 330, 726 A.2d 1283. Consistent with our well-established rules of statutory interpretation, we do not find within RSA 47:17, VII, implied local authority to regulate the use of private docks for personal boating or boat docking on public waters. St. Joseph Hosp. of Nashua v. Rizzo, 141 N.H. 9, 11-12, 676 A.2d 98 (1996) ("Normally the expression of one thing in a statute implies the exclusion of another." (quotation omitted)).
Contrary to the ZBA's assertion, the statutory definition of "wetlands," found within the provisions authorizing local land use regulation, does not, by itself, suggest local authority to regulate personal boating and boat docking on waters held in trust for the public. See RSA 482-A:2, X (Supp. 2008) ("`Wetlands' means an area that is inundated or saturated by surface water or groundwater at a frequency and duration sufficient to support, and that under normal conditions does support, a prevalence of vegetation typically adapted for life in saturated soil conditions."). The legislature could have defined "wetlands" either to facilitate wetland setbacks or for local wetland regulation outside the sphere of any exclusive State wetland regulation. See Blagbrough Family Realty Trust v. Town of Wilton, 153 N.H. 234, 238, 893 A.2d 679 (2006) ("[M]unicipalities may adopt local ordinances to further wetland protection in areas outside the State's regulation."); Cherry, 150 N.H. at 725, 846 A.2d 508 (examining compliance with local wetlands ordinance); 3 Rathkopf, supra at 48-37 ("Local regulation of wetlands is permitted when not in direct conflict with state law.").
Given our conclusion, we do not reach the other issues raised in this appeal.
Reversed.
BRODERICK, C.J., and DALIANIS, DUGGAN and GALWAY, JJ., concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563855/ | 155 F.2d 799 (1946)
PHILADELPHIA RECORD CO.
v.
MANUFACTURING PHOTO-ENGRAVERS ASS'N OF PHILADELPHIA et al.
No. 9082.
Circuit Court of Appeals, Third Circuit.
Argued March 18, 1946.
Decided May 17, 1946.
*800 Daniel Lowenthal, of Philadelphia, Pa. (Jerome J. Rothschild, Leonard J. Schwartz, and Fox, Rothschild, O'Brien & Frankel, all of Philadelphia, Pa., on the brief), for appellant.
Robert T. McCracken, of Philadelphia, Pa. (C. Russell Phillips, of Philadelphia, Pa., on the brief), for appellees Philadelphia Photo-Engravers' Union No. 7, I. P. E. U. of N. A., Warner D. Curry, and Charles J. Kraft.
Walter B. Gibbons, of Philadelphia, Pa. (Albert W. Sanson, of Philadelphia, Pa., on the brief), for appellees Artcraft Photo-Engravers Co., Inc., et al.
Before BIGGS, GOODRICH, and McLAUGHLIN, Circuit Judges.
Opinion of the Court.
McLAUGHLIN, Circuit Judge.
Plaintiff, a Pennsylvania corporation, is engaged in publishing a morning newspaper in Philadelphia. It brought suit in the District Court under the Declaratory Judgments Act[1] asking that the alleged activities of the defendants be declared to be in violation of the Sherman Anti-trust Law[2] and for a preliminary and final injunction. Defendants are the Manufacturing Photo-Engravers Association of Philadelphia, a corporation, the eighteen companies which are members thereof, Philadelphia Photo-Engravers' Union No. 7, I. P. E. U. of N. A. and the president and general manager of the latter.
From the facts found by the Trial Court it appears that since 1929 plaintiff has been engaged in the commercial photo-engraving business. At the time of the hearing before the District Court plaintiff's gross from this source amounted to about $100,000 a year with approximately 25% of the business in interstate commerce. Plaintiff employs twenty-seven photo-engravers, all members of the defendant union. Twenty-two of these work at night and the remaining four *801 in the daytime. It is necessary to have twenty-two men on the night shift to properly take care of the newspaper's emergency requirements. During slack periods the men do commercial photo-engraving which is chiefly produced at night. Because of the local labor situation in the particular trade there are no extra photo-engravers available for plaintiff during the day. The defendant association is comprised entirely of competitors of the plaintiff in commercial photo-engraving. These were designated by the president of the union testifying in the plaintiff's case as "* * * * the manufacturing commercial employers of Philadelphia * * *." (Emphasis ours).
The plaintiff and the union have a contract covering plaintiff's daytime commercial photo-engraving. They have no contract as to the night commercial work. The association and the union for many years had a contract covering their general relationship which included a supplemental agreement providing that "future night forces shall be prohibited unless by consent of both parties to this agreement." The latest supplemental agreement expired February 28, 1945. The parties, however, continued to act in accordance with it and the failure to renew it did not alter their relationship in connection therewith. One of the members of the association, Peerless Engraving Co., is a partnership with one of that firm also the current president of the association. That company is permitted to do night commercial photo-engraving with the approval of the union and the association. The same company does the photo-engraving for another Philadelphia newspaper.
In 1944 plaintiff asked the association and the union to negotiate a night commercial contract with it. On September 6, 1944 there was a meeting in the office of the plaintiff. Those present were the business manager of the union, the then president of the association, its secretary and attorney and representatives of the plaintiff. The purpose of the meeting was to find a solution which would permit the union to negotiate the desired contract. The association's representatives objected to the proposed negotiations on the ground that plaintiff was charging lower prices which the association's representatives declared was unfair competition and on the ground that there was insufficient work for members of the association. On September 14, 1944 the association adopted the following resolution, a copy of which was sent to the union:
"Resolved: That the Association insist upon compliance of the Supplemental Agreement dated February 2, 1937 made and executed by the Photo-Engravers' Union No. 7 of Philadelphia and Manufacturing Photo-Engravers' Association of Philadelphia, and continued by supplemental agreement each year, which agreement is now in full force and effect."
On July 30, 1945 a strike vote was taken among plaintiff's photo-engravers under the provisions of the Smith Connally Act[3] to determine whether they should stop doing commercial work at night. The employees rejected the strike proposal. On September 24, 1945 in compliance with the order of the union, plaintiff's photo-engraving employees stopped night commercial work for the plaintiff. This was not due to any grievance or dispute between the union and the plaintiff as to labor or working conditions.
The District Court [63 F. Supp. 254, 259], held "* * * the evidence sustains a finding that the union combined with, or aided and abetted, the defendant association, at least to prevent the Record from producing the commercial photo-engraving products at night." It further held that under the facts this practically prevented plaintiff from engaging in the commercial photo-engraving business.[4] The conclusion of law of the Trial Judge on this is:
"3. A combination and agreement exists between defendant union, defendant association, and defendant competitors (1) to enforce the supplementary agreement between *802 defendant union and defendant association, which restricts future night commercial photo-engraving in Philadelphia without the consent of both parties, against the plaintiff, and (2) to compel the plaintiff to cease production of commercial photo-engraving products at night." (Emphasis ours).
The Court held:
"The evidence sustains plaintiff's contention that the effect of the work stoppage, coupled with the status of the local labor supply, reduced the volume of commercial engravings produced and lowered the volume of interstate shipments. These acts of the defendants affected interstate commerce."
The Court then found that the evidence did not show an interference with interstate commerce in violation of the Sherman Act and denied the motion for a temporary injunction saying:
"The evidence adduced as to the present application of the supplemental agreement does not show such restraint upon competition which has `or is intended to have an effect upon prices in the market or otherwise to deprive purchasers or consumers of the advantages which they derive from free competition * * *.' [Apex Hosiery Co. v. Leader], 310 U.S. 469, 501, 60 S. Ct. 982, 84 L. Ed. 1311, 128 A.L.R. 1044. There is no evidence that the association, in concert with the union, is attempting to fix or raise prices. Nor is there any evidence that cessation of night production of photo-engravings by the plaintiff `had any substantial commercial effect upon either the prices at which the goods (are) sold or the supply upon the market.' United States v. Gold, 2 Cir., 115 F.2d 236, 237. There is a total lack of evidence showing that the joint action of the union and the association prejudiced the consumers in any way."
The evidence clearly supports the finding of the Trial Judge that there was a combination between the union and the association to prevent the plaintiff from producing photo-engraving products at night. This because of local labor conditions known to all the parties shows not only the intent of the defendants to prohibit the plaintiff from engaging in the commercial photo-engraving business but achieves that practical result. The finding that the enforcement of the supplemental agreement between the union and the association was forced by the latter is fully sustained. Mr. Kraft, the president of the union testified that the association by its resolution "called attention to the union to enforce the contract that we have with them." Again he said: "But it just meant for us that they were calling our attention that we have a commercial agreement with the manufacturing commercial employers in Philadelphia, and it had stipulated paragraphs in there that we were to live up to during an agreement that we had with them." And further: "Because of the resolution, we immediately I am pretty sure we got in touch with the Philadelphia Record company in trying to negotiate with them to eliminate all commercial work at night." He stated that the resolution of the association was the only reason for the union getting in touch with the plaintiff. At the time there was no labor dispute between the union and the plaintiff. While commercial work was frowned on by the parent body of the union, there was actually a current commercial day contract between the plaintiff and the Philadelphia union. There was also a night commercial contract in existence between the union and Peerless with the latter company admittedly handling newspaper photo-engraving production. The transcript amply justifies the District Judge's finding that the reasons the association pressed the union to prohibit plaintiff's night photo-engraving were that plaintiff was charging lower prices and because there was insufficient work for members of the association. It is obvious from the record, as the District Court decided, that the supplemental agreement between the association and the union continued effectively between parties even though it was allowed to formally expire in January 1945 after this matter had come to a head in September 1944 and after the association had insisted that the union put an end to the plaintiff's night commercial photo-engraving. It is noteworthy that at the hearing in this case September 27, 1945 the president of the *803 union on at least two occasions speaks of the supplemental agreement in the present tense.
There can be no doubt from the whole case that the defendant association comprised substantially the commercial photo-engraving industry in Philadelphia. It is true that the District Judge does not use the word "monopoly." He plainly implies it, however, when he holds that the supplemental agreement "restricts future night commercial photo-engraving in Philadelphia without the consent of both parties [the association and the union], against the plaintiff." The president of the union testified that the agreement was with "the manufacturing commercial employers in Philadelphia." The sense of what both the president and the secretary of the association said at the meeting of September 6th is to the same effect. Nor is there any doubt that the members of the association are in business competition with the plaintiff. Indeed, this is frankly stated in the association's brief.
As the case stands it reveals a combination of labor and business instigated by the latter to put an end to night commercial work by the plaintiff which, under the facts, would put the plaintiff out of the entire commercial photo-engraving field. The association had two reasons for so doing. The first was plaintiff's lower prices. The second was that there was not enough work to go around or, in other words, the elimination of a competitor. There was no labor dispute between the plaintiff and the union. The acts of the defendants affected interstate commerce.
We think that the plaintiff not only has shown a case where "fair play" indicates an injunction as stated by the District Court, but where as a matter of law it is entitled to such injunction. The volume of interstate commerce involved is shown generally by the over-all figures which are not contradicted. That business is primarily from the night production which has been wholly stopped. Increased day production is impossible under the circumstances. Final computations of loss could hardly have been available at the hearing held within a week of the stoppage. Even if the inference as to the amount of interstate commerce business could not be as sharply drawn as is possible under the present simple facts, the cases definitely show that the primary governing factor in such matter as this is the intent "to restrain or control the supply entering and moving in interstate commerce, or the price of it in interstate markets." Coronado Coal Co. v. United Mine Workers, 268 U.S. 295, 45 S. Ct. 551, 556, 69 L. Ed. 963; United Leather Workers' Int. Union v. Heikert & Meisel Truck Co., 265 U.S. 457, 44 S. Ct. 623, 68 L. Ed. 1104, 33 A.L.R. 566. Apex Hosiery Co. v. Leader, 310 U.S. 469, 60 S. Ct. 982, 84 L. Ed. 1311, 128 A.L.R. 1044, which involved purely a labor dispute is to the same effect. There the presently lamented Chief Justice, then Justice Stone, said at page 512 of 310 U.S., at page 1002 of 60 S.Ct.:
"We only hold now, as we have previously held both in labor and non-labor cases, that such restraints are not within the Sherman Act unless they are intended to have, or in fact have, the effects on the market on which the Court relied to establish violation in the Second Coronado case."
This litigation concerns the converse of the problem involved in the Apex decision, namely, where a labor organization is used by a combination of those engaged in an industry as the means or instrument for suppressing competition or fixing prices. As such it comes squarely under the rule of the recent opinion of the Supreme Court in Allen Bradley Co. v. Union, 325 U.S. 797, 65 S. Ct. 1533, 1536, 89 L. Ed. 1939. There a combination of union, contractors and manufacturers, forced agreements to purchase and sell electrical equipment locally. Mr. Justice Black for the Court stated the precise question to be:
"Our problem in this case is therefore a very narrow one do labor unions violate the Sherman Act when, in order to further their own interests as wage earners, they aid and abet business men to do the precise things which that Act prohibits?"
The Court in allowing an injunction to the plaintiff held:
"* * * we think Congress never intended that unions could, consistently with the Sherman Act, aid non-labor groups to *804 create business monopolies and to control the marketing of goods and services."
And said further at page 811 of 325 U.S., at page 1541 of 65 S.Ct., 89 L. Ed. 1939:
"A business monopoly is no less such because a union participates, and such participation is a violation of the Act."[5]
Lumber Products Ass'n v. United States, 9 Cir., 144 F.2d 546, certiorari granted 323 U.S. 706, 65 S. Ct. 430, 89 L. Ed. 569, is the same type of case.[6] There the Court said at page 549 of 144 F.2d:
"We agree with the government that the charges of the indictment and the factual allegations made in their support are not of a restraint upon commerce merely incident to the ordinary disruption of the production of an employer, arising out of a protracted labor dispute and necessary to the achieving of a legitimate objective of organized labor. Rather there is here alleged a combination for a direct restraint upon commerce with an objective of destroying the competition of that commerce and permitting the fixing and maintenance of the local area prices at an arbitrary, artificial and non-competitive level. It is such intended restraints for such an objective at which the sanctions of the Sherman Act are directed."
During the hearing the president of the association asked by the Court why the association would not give a contract to the plaintiff similar to the Peerless agreement replied, "I think they would." Immediately thereafter he testified that he had not changed his position from the date of the association resolution requiring the union to stop night work on the Record. He then stated that he had not understood the Court's previous question above referred to. At the end of the testimony, counsel for the association in effect stated the association had no objection to the Record having the same kind of contract as Peerless. The District Court held, "I do not think this change of attitude of the association renders the union immune from the law of the Allen Bradley case." That holding was obviously correct. The underlying principle is concisely set out in Vaughan v. John C. Winston Co., 10 Cir., 83 F.2d 370, at page 373:
"Even if he had recanted at the trial, which he did not, still there was equity in the bill when it was brought, and relief to which appellee was then entitled could not be denied because of verbal protestations upon the trial. Equity may act to avert an impending wrong; it is not divested of power because a defendant suspends his wrongdoing when he is sued, or protests his good intentions for the future."
And see Swift & Co. v. United States, 276 U.S. 311, 326, 48 S. Ct. 311, 72 L. Ed. 587.
The order of the District Court is reversed and the cause remanded with directions to that Court to grant a preliminary injunction forthwith to the plaintiff against the defendants. Such order shall be confined to the illegal activities in which the union engaged in combination with the association and the members thereof and restrain until final hearing and further order of the Court, the defendants, severally and jointly, their officers, agents, servants, employees, attorneys, and anyone in active concert or participation with them from ordering, directing, planning, inducing, or attempting to induce, any of the photo-engraving employees of the plaintiff to refuse to work upon the plaintiff's commercial photo-engraving products at night in pursuance to and in furtherance of any conspiracy and combination to stifle or restrain interstate commerce, or to secure the defendant association and its members a practical monopoly in commercial photo-engraving products. Reversed.
NOTES
[1] Section 274d of the Judicial Code, 28 U.S.C.A. § 400.
[2] Act of July 2, 1890, c. 647, § 1, 26 Stat. 209, as amended, August 17, 1937, c. 690, Title VIII, 50 Stat. 693, 15 U.S.C.A. § 1.
[3] War Labor Disputes Act, Act of June 25, 1943, c. 144, § 8, 57 Stat. 167, 50 U.S. C.A. Appendix, § 1508.
[4] The Court said:
"It [plaintiff] seeks to engage in a lawful business in a lawful and legitimate way. Under present circumstances, it is practically prohibited from so doing by defendants' acts."
[5] The opinion in Hunt et al. v. Crumboch et al., 325 U.S. 821, 65 S. Ct. 1545, 89 L. Ed. 1954, also by Mr. Justice Black, was filed the same day as Allen Bradley Co. v. Union. That case was solely concerned with a labor dispute which had resulted in the ruination of the employer's business. This Circuit was affirmed in its holding that the Sherman Act did not there apply.
[6] Certiorari was allowed in this case at the same time as in Allen Bradley Co. v. Union, supra, because of the contrary conclusions of the Second and Ninth Circuits. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1169760/ | 931 P.2d 244 (1997)
JACKSON HOLE TRADERS, INC., a Wyoming Corporation; David W. Speaks; and Elizabeth Speaks, Appellants (Defendants),
v.
Catherine JOSEPH d/b/a Metro Classics, Appellee (Plaintiff).
No. 96-58.
Supreme Court of Wyoming.
January 28, 1997.
*245 James K. Lubing of Law Office of James K. Lubing, Jackson, for Appellants.
Kenneth S. Cohen, Jackson, for Appellee.
Before TAYLOR, C.J., and THOMAS, MACY, GOLDEN and LEHMAN, JJ.
MACY, Justice.
Appellants Jackson Hole Traders, Inc., David Speaks, and Elizabeth Speaks appeal from the judgment which was entered in favor of Appellee Catherine Joseph, who was doing business as Metro Classics.
We affirm in part and reverse in part.
ISSUES
Appellants present the following issues for our review:
I. Did the trial court violate [Appellants'] due process rights by disallowing them an adequate opportunity to defend [Appellee's] lawsuit?
II. Did the trial court err when it concluded, as a matter of law, that the Uniform Commercial Code applied to the contracts between the parties when the contracts were for labor and services and not goods?
III. Did the trial court err when it determined, as a matter of law, that [Appellants] David W. Speaks and Elizabeth Speaks were individually liable for the debts of their corporation when the trial court made no findings to support such a conclusion, and the evidence at trial was to the contrary?
FACTS
The trial court summarized the evidence in its findings of fact and conclusions of law. We quote from the relevant portions of the judgment:
1. [Appellee] does business as Metro-Classics, and she is a resident of the state of New York. [Appellee] designs and manufactures men's and women's clothing.
2. In the manufacturing process [Appellee] makes some of the clothing herself, but on large orders subcontracts various steps in the manufacturing process, including grading of patterns, cutting, and sewing.
3. [Appellant] Jackson Hole Traders, Inc., is a Wyoming corporation and [Appellants] David W. Speaks and Elizabeth Speaks are corporate officers and apparently share holders.
4. [Appellants] operate[] a clothing store in Jackson, Wyoming known as Jackson Hole Traders, which sells clothing for men and women through a retail store and through a mail-order catalogue business.
. . . .
*246 6. [Appellants] from time to time hire clothing manufacturers to manufacture clothing to sell in their store and through their mail-order catalogue.
7. In 1993 [Appellants] contracted with [Appellee] to design and/or manufacture clothing to sell in their store, and this was accomplished by [Appellee] to the mutual satisfaction of the parties.
8. In the Spring of 1994, [Appellants] and [Appellee] discussed a large order of clothing to be manufactured by [Appellee].
9. Pursuant to these discussions, [Appellee] had a pattern maker work on the patterns and [Appellee] manufactured certain samples of about fourteen different styles, which samples were used by models for [Appellants] and photographed for a Fall/Winter catalogue on or about May 20, 1994.
10. On or about May 24, 1994, [Appellant] Elizabeth Speaks called [Appellee] on the telephone, and during an approximately sixty-seven minute phone conversation, tentative quantities of clothing items were discussed. [Appellee] was to supply certain fabric for some of the clothing and [Appellants] were to order and supply the remaining fabric.
11. In early March, 1994, [Appellants] placed an order for several hundred yards of fabric from Woolrich to be used in the manufacture of clothing by [Appellee]. [Appellants] failed and refused to provide sufficient financial background information for Woolrich to immediately extend to them credit. Several weeks of correspondence and exchange of information occurred, delaying the shipping of the Woolrich fabric to [Appellee] by approximately six weeks.
12. During the telephone conversation of May 24, [Appellee] and Elizabeth Speaks discussed fitting of the patterns, changes to the patterns and quantities of clothing.
13. [Appellee] thereafter initiated a credit check of [Appellants] and on or about June 10, 1994, [she] went to her banker to secure a $50,000.00 loan to be used to produce the clothing for [Appellants] and other customers. At that time [Appellee] had nothing in writing from [Appellants] and her bank required her to obtain the same.
14. [Appellee] informed [Appellants] that she would require their orders to be in writing and on or about June 21, 1994 [Appellants] caused written purchase orders to be communicated to [Appellee] for approximately nine hundred items of clothing to be manufactured by [Appellee]. One purchase order recited a cancellation date of July 30, 1994, and the remaining orders specified August 15, 1994. There were five purchase orders in all.
15. It is customary in the clothing business for delivery dates of clothing for the Fall season to be made from July through the end of September. Up until the point that the written purchase orders had been transmitted to [Appellee], there had been no discussion between [Appellee] and [Appellants] with regard to cancellation or delivery dates.
16. A cancellation date in an order is a date specified by the parties, and if the order is not delivered by that date, the purchaser has the option of returning the goods and cancelling the order or negotiating other terms.
17. When [Appellee] received the five purchase orders with the cancellation date[s] she spoke on the telephone with [Appellant] Elizabeth Speaks and advised her that she could not meet those cancellation dates. [Appellant] Elizabeth Speaks agreed to move each of the dates by fifteen days. [Appellee] informed her that it would be helpful but she could not get all of the items there by August 30, 1994. [Appellant] Elizabeth Speaks by her own admission told [Appellee] to "do the best you can." Thereafter the parties understood that the cancellation date of August 30, 1994 could not be met by [Appellee].
18. [Appellee] testified that it takes her approximately ten to twelve weeks from the time something is ordered to go through the entire process through production.
19. During the production of the clothing by [Appellee] she experienced some problems with some of the Woolrich fabric *247 known as Blue Ombre, which was a plaid pattern, and which during the mass production of the cutting process, produced problems in lining up the lines on the plaid fabric at the seams. [Appellee] communicated this problem to [Appellant] Elizabeth Speaks during the production process and was told to do the best she could.
20. The first shipment of clothing to [Appellants] from [Appellee] went out on July 18, 1994 and shipments continued thereafter through the end of October, 1994. Part of these items of clothing delivered were a supplemental holiday order which was placed after the initial order by [Appellants] with [Appellee].
21. [Appellee] submitted her bills to [Appellants] in the form of invoices, the terms of which were "Net 30," which meant that the goods were to be paid for within thirty days. This is a standard in the clothing industry.
22. All of the goods shipped through the end of August, 1994 by [Appellee] to [Appellants] were paid for on an untimely basis, that is at least six weeks late.
23. [Appellee's] exhibits 18 through 33[] are for invoices for clothing shipped after September 1, 1994, none of which have ever been paid for by [Appellants], and which total $33,101.61 for goods shipped to [Appellants] from September 7, 1994 through October 31, 1994.
24. Some of the items of clothing were returned by [Appellants] to [Appellee], and [Appellants] are entitled to a credit of $1,096.00 for the returned merchandise, and after all just credits there still remains a sum of $32,005.61 owing to [Appellee] by [Appellants].
. . . .
29. [Appellants] notified [Appellee] of certain problems on a timely basis, for which [Appellants] should receive credit in the amount of $1,096.00.
30. After not having been paid for approximately $33,000.00 of merchandise well beyond the Net-30-Day period, [Appellee] began making contacts with [Appellants] to obtain payments.
31. [Appellee] was given the "telephone run-around" any time she tried to contact [Appellant] David W. Speaks, who was in charge of paying the bills for the . . . corporation. Mr. Speaks was seldom there and the people answering the phone always told [Appellee] that he would return her calls. He never did.
32. On December 9, 1994, [Appellee] hired counsel and contacted [Appellants] to seek payment. After that contact, [Appellants] caused the remaining merchandise they had in their possession which had been manufactured by [Appellee] to be packaged up and shipped to [Appellee]. [Appellee] refused to accept the same and they have been returned to [Appellants].
33. This case in its essence can be summarized as follows: Approximately nine hundred articles of clothing were manufactured by [Appellee] and shipped to [Appellants]; [Appellants] inventoried these items and took them into their possession, placed them on the retail sales floor and sold them and also placed them in their warehouse and sold them from their catalogue; [Appellants] sold approximately seventy percent of the items manufactured; [Appellants] have not paid for a substantial portion of the items; when pressed for payment [Appellants] have tried to ship the goods back and have tried to assess a two percent per month late penalty against [Appellee] for approximately $30,000.00.
. . . .
35. [Appellants] accepted shipment of all of the merchandise with the previous mentioned exceptions, kept it in their possession for two to three months and never complained about late delivery or defective merchandise. They cannot be heard to complain about that now.
. . . .
39. [Appellee] has billed [Appellants] the sum of $51,171.79 for clothing manufactured by her for [Appellants] at their request. The sums billed to [Appellants] were in accord with the per article cost agreed to by the parties prior to the manufacture of these items.
40. [Appellants] made partial payments to [Appellee] from time to time in August, *248 September and October, 1994 totalling $18,070.18. [Appellants] also seasonably returned several articles of clothing for which they are entitled to a credit in the sum of $1,096.00. After all just credits and allowances [Appellants] owe [Appellee] the sum of $32,005.61 and have owed that to her since thirty days after the last invoice was sent. Interest has accrued on the unpaid invoices per the agreement of the parties at 1.5 percent per month, and accrued interest through November 2, 1995, was in the amount of $5,958.00.
41. The Uniform Commercial Code provides for buyers' rights on improper delivery. In such event the buyer may: (1) reject the whole; (2) accept the whole; or (3) accept any commercial unit or units and reject the rest. § 34.1-2-601 W.S.1977 (1991 comp). In this case with the exception of the rejection of goods for which [Appellants] have received credit, they accepted the entire remainder of the goods.
42. [Appellants'] attempted rejection of the goods in December was not timely as required by § 34.1-2-602 W.S.1977 (1991 comp).
43. [Appellants] accepted the goods, as that term is defined in § 34.1-2-606 W.S. 1977 (1991 comp), in that after reasonable opportunity to inspect the goods, they did not notify the seller of any non-conformity.
44. [Appellee] is entitled to judgment against [Appellants] in the principal sum of $32,005.61, accrued interest in the amount of $5,958.00, accruing interest and costs of suit.
DISCUSSION
A. Due Process Claim
In their first claim of error, Appellants assert that the trial court violated their right to be heard when it did not allow them to have an adequate opportunity to present their defense. Appellee argues that Appellants were afforded the opportunity to be heard in a meaningful manner.
"[D]ue process must be afforded to litigants in the form of notice and a meaningful opportunity to be heard." Lawrence-Allison and Associates West, Inc. v. Archer, 767 P.2d 989, 997 (Wyo.1989). "A meaningful opportunity to be heard necessarily requires a hearing involving elements of formality and procedure dependent upon `the importance of the interests involved and the nature of the subsequent proceedings.'" Id. (quoting Boddie v. Connecticut, 401 U.S. 371, 378, 91 S.Ct. 780, 786, 28 L.Ed.2d 113 (1971)).
At various times throughout the trial, the trial court and the parties discussed how much time each side would need for its case. Appellants informed the trial court that they did not think that they would need more than "two to three hours, maximum" in which to present their case. The trial court scheduled its time accordingly. Then, with full knowledge of the limitations which the trial court intended to impose, Appellants requested a recess late in day two of the trial instead of continuing on as long as the trial court would allow on that day. At that time, the trial court informed Appellants that only three hours would be allotted to this case on day three.
We are somewhat puzzled about Appellants' complaint because they were given more than the "two to three hours, maximum" which they had informed the trial court that they would need in order to fully present their case. Equally confusing is the fact that Appellants chose to wait until late in day three to call their most important witness when they knew that her time would be limited. Furthermore, when Appellants realized that their case was taking longer than they had expected, they did not request more time.
Appellants do not point us to any authority which prohibits trial courts from limiting parties to the amounts of time that they specified they would need to fully present their cases. The trial court in this case did not arbitrarily limit the substance of the evidence which Appellants wanted to present; it merely limited the time in which they were allowed to present it to the amount of time which they had indicated that they thought would be sufficient. Appellants' decisions to recess on day two and to put on their most important witness late in day three were decisions they made knowing that the trial court would give this case only three hours *249 on day three in which to be completed. We will not excuse Appellants from those decisions under the guise of a due process violation.
Even if we were convinced that the trial court erred by limiting the time frame in which Appellants had to present their case, we would find that the error was harmless because Appellants have failed to explain what evidence they would have presented had they been given more time and why such evidence was important to their case. See Pure Gas and Chemical Company v. Cook, 526 P.2d 986, 992 (Wyo.1974). Appellants invite us to review the record in its entirety in order to get an overall impression of how their case was compromised by the time limitation. We have reviewed the entire record, and we do not see any reason why Appellants needed more time. The witnesses' testimony was surprisingly uncontested. We conclude from reviewing the record, without having the benefit of an explanation to the contrary, that the trial court had a complete version of the facts before it when it made its decision.
B. Uniform Commercial Code
Appellants claim that the trial court improperly concluded that the Uniform Commercial Code governed the parties' transaction, arguing that this transaction was principally one for labor and services. Appellee counters that the trial court appropriately applied the Uniform Commercial Code to this transaction because it was for the sale of goods.[1]
For support of their proposition that this transaction was one for services rather than for goods, Appellants rely on Wells v. 10-X Manufacturing Company, 609 F.2d 248 (6th Cir.1979). That case, however, differs from the case at bar because the buyer in Wells furnished the manufacturer with virtually everything but the labor:
In this case, 10-X agreed to "cut, make, and finish" for Wells 550 dozen hunting shirts. While 10-X was to furnish the thread, all other materials involved in the production of the shirt were to be provided by Wells. Wells was in all other respects responsible for the design and development of the shirt.
. . . The language used in the contract clearly bespeaks the intention of the parties that 10-X's obligation under the contract was essentially to provide the manpower and machine capabilities for production of the hunting shirt. That the only material supplied by 10-X in the entire production process was thread is a factor to be considered in characterizing the contract one for services rather than goods.
Wells, 609 F.2d at 255.
Although Appellants purchased and supplied the outer fabric for some of the garments produced by Appellee, Appellee supplied all the other materials which were used to manufacture the garments; i.e., buttons, linings, interfacing, special care labels, as well as the outer fabric for the remaining garments. Some garments were patterned from Appellee's own designs. Even for those styles which utilized a design provided by Appellants, Appellee and her pattern maker had to restyle them because of various changes which were requested by Appellants. Each pattern was then graded into the particular sizes to be used for that garment. Under the facts of this case, the trial court correctly applied the Uniform Commercial Code as this transaction was one for the sale of goods even though labor was involved in producing the goods.
Even if the Uniform Commercial Code did not apply to this transaction, Appellants would still owe Appellee the amount which was determined by the trial court. "A breach of contract is a failure without legal excuse to perform any promise which forms a *250 whole or a part of a contract." Sagebrush Development, Inc. v. Moehrke, 604 P.2d 198, 201 (Wyo.1979).
"The measure of damages for breach of contract is that which would place plaintiff in the same position as he would have been had the contract been performed, less proper deductions. In other words, it is that which will compensate him for the loss which full performance would have prevented or breach of it entailed."
Id. (quoting Reynolds v. Tice, 595 P.2d 1318, 1323 (Wyo.1979)).
Appellee shipped approximately 900 garments to Appellants between July 18, 1994, and the last week of September 1994 plus an additional "holiday" order during the last week of October 1994. Of the 900 garments, Appellants properly rejected ten vests and four coats, returning these garments to Appellee in early October. Appellee gave them a credit for these items. Appellants kept all the other goods until mid-December 1994 when Appellee demanded that Appellants pay the remaining $32,000 which they owed to her. In response to that demand, Appellants packed up 350 garments and shipped them back to Appellee. David Speaks gave the following testimony with regard to Appellants' response to Appellee's demand:
[APPELLEE'S ATTORNEY:] Now, I sent you a letter dated December 9 asking for thirty-two thousand dollars for [Appellee], did I not?
A. Yes, you did.
Q. And your response was to pack up 350 garments that she had manufactured at your request and ship them back in bulk to her, wasn't it?
A. That's what we did, yes.
. . . .
[Q.] Now, the goods that you shipped back to [Appellee], you instructedeither you or Ms. Speaks instructed someone working for you to take the goods off of the showroom floor and box them up and send them back. Some of the goods that were returned to [Appellee] were pulled off the s[h]owroom floor, weren't they?
A. Most likely, yes. I'm almost positive, yeah.
Q. And some of those items were pulled off the shelves where they had been stored for several months, weren't they?
A. You're talking about in the warehouse?
Q. Yes.
A. Yes, they were.
. . . .
Q. If you don't think the goods got there on time and you think that you have been put in a bad way as a result of that, you can refuse the shipment, can't you?
A. You can refuse the shipment, yes, you can. That is one option.
Q. And you could have done that, couldn't you?
A. That's an option, yes.
Q. But you didn't refuse the shipment, did you?
A. No, we did not.
Q. And you put the goods in your warehouse, didn't you?
A. Yes, they were in the warehouse.
Q. And put them on your showroom floor, didn't you?
A. Yes, we did.
Q. And you sold them through your catalog; is that right?
A. Yes, we did.
Q. And you sold many of them in your store, didn't you?
A. Yes, we did.
. . . .
[Q.] When I sent you the letter on December 9th asking for payment of the thirty-two thousand plus dollars owed to [Appellee], your response within 72 hours was to take everything and ship it back to [Appellee]; is that correct?
A. Yes, it was.
Appellants breached the contract when they failed to pay for the garments which had been sent to them and which they had accepted for resale. The trial court properly awarded damages in an amount which would place Appellee in the same position that she would have occupied had the contract been performed.
*251 C. Corporate Veil
Appellants contend that the trial court improperly pierced the corporate veil of Jackson Hole Traders, Inc. when it entered a judgment against David Speaks and Elizabeth Speaks personally. Appellants maintain that the record is completely devoid of any evidence which would support this finding. Appellee does not address this issue in her brief.
Before the corporate veil can be pierced, the evidence must demonstrate that
the corporation is not only influenced and governed by [a particular] person, but that there is such a unity of interest and ownership that the individuality, or separateness, of [such] person and corporation has ceased; [and] that the facts are such that an adherence to the fiction of the separate existence of the corporation would, under the particular circumstances, sanction a fraud or promote injustice.
Minifie v. Rowley, 187 Cal. 481, 202 P. 673, 676 (1921). See also Miles v. CEC Homes, Inc., 753 P.2d 1021, 1023 (Wyo.1988); Amfac Mechanical Supply Co. v. Federer, 645 P.2d 73, 77 (Wyo.1982).
We agree with Appellants that the record does not contain any evidence to support the trial court's decision to pierce the corporate veil. Additionally, during Appellee's oral argument to this Court, she conceded this issue. We, therefore, reverse that portion of the trial court's judgment which pierced the corporate veil of Jackson Hole Traders, Inc. and found David Speaks and Elizabeth Speaks personally liable for the amount of the judgment.
CONCLUSION
The trial court afforded Appellants a meaningful opportunity to be heard and that it properly applied the Uniform Commercial Code to the facts of this case. Sufficient evidence, however, did not support the trial court's decision to pierce the corporate veil of Jackson Hole Traders, Inc.
Affirmed in part and reversed in part.
NOTES
[1] The relevant statute provides:
§ 34.1-2-102. Scope; certain security and other transactions excluded from this article.
Unless the context otherwise requires, this article applies to transactions in goods; it does not apply to any transaction which although in the form of an unconditional contract to sell or present sale is intended to operate only as security transaction nor does this article impair or repeal any statute regulating sales to consumers, farmers or other specified classes of buyers.
WYO. STAT. § 34.1-2-102 (1991). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1735189/ | 483 S.W.2d 179 (1972)
The TRAVELERS INSURANCE CO., Appellant,
v.
George McCLUSKEY, Appellee.
No. 5-5999.
Supreme Court of Arkansas.
July 10, 1972.
Rehearing Denied August 28, 1972.
*180 Terral, Rawlings, Matthews & Purtle, Little Rock, for appellant.
McMath, Leatherman & Woods, Little Rock, for appellee.
FOGLEMAN, Justice.
Appellee McCluskey was injured by reason of the breaking of a wrench he was using on a construction job at Reynolds Metals Company plant at Patterson as an employee of Erection Service Company for which Travelers Insurance Company was the workmen's compensation insurer. Travelers paid workmen's compensation benefits to McCluskey, who later filed suit against Reynolds, Clarence Weiman, the job superintendent who furnished the wrench, and Proto Tool Company, the manufacturer of the wrench, as third-party tortfeasors. He was represented in this suit by Judge Sam Robinson, who associated the firm of McMath, Leatherman, Woods and Youngdahl. The firm of Terral, Rawlings, Matthews and Purtle represented Travelers in connection with its subrogation claim against the third-party tortfeasors. Mr. Gail O. Matthews of the Terral firm had a telephone conversation with Mr. Henry Woods of the McMath firm about Travelers' subrogation claim. Matthews followed up the conversation with a letter dated May 30, 1968, which read as follows:
This will confirm our telephone conversation of May 28, 1968, wherein I advised you that I represent Travelers, the Workmen's Compensation carrier for your client, and further confirm that you would honor our subrogation rights.
To date, Travelers had paid the sum of $1,870.00 temporary total and temporary partial and $3,469.00 medical. It looks like we will be paying for a long time to come.
Please call me prior to settlement or trial so I can advise you of our exact amount of interest in the case.
*181 There was no response to this letter, but there was further correspondence between the law firms, to some of which we will later make reference.
Eventually the case came to trial in the United States District Court in Little Rock. McCluskey and his attorneys encountered unforeseen difficulties in the trial, and a verdict in favor of Proto Tool Company was directed. When this occurred the liability insurance carrier for Reynolds made an offer of $23,000 to settle the claim of McCluskey. The offer was accepted by appellee upon the condition that none of it would have to be paid to Travelers, and specified that payment be made under circumstances that would protect Travelers' interest by permitting it to proceed with the lawsuit. Travelers had not filed any intervention in the suit and no notice of the offer or the settlement was given to it or its attorneys, either before or after it was effectuated. The release of Weiman and Reynolds Metals executed by McCluskey and his wife contained a reservation of McCluskey's rights to workmen's compensation benefits and a recognition by the parties that all rights of the employer and Travelers by way of subrogation or otherwise any party except George McCluskey and wife remained unimpaired and unaffected by the release and settlement.
After the settlement was made, McCluskey filed a claim for additional workmen's compensation benefits with the Workmen's Compensation Commission, but it was resisted by appellant, which claimed a lien upon the net proceeds of the settlement made by McCluskey. The Workmen's Compensation referee held for appellant on the basis of estoppel and by holding that there had been a "recovery" by McCluskey under Ark.Stat.Ann. § 81-1340 (Repl.1960). The Workmen's Compensation Commission reversed the referee's decision, holding that appellant had no lien, because it did not intervene, and that the agreement between the attorneys was carried out. The circuit court affirmed the commission.
Appellant relies upon three points for reversal. They are:
I. That appellee is estopped to deny that appellant is entitled to a two-thirds lien upon appellee's net recovery.
II. This case is not controlled by St. Paul v. Wood.
III. The court should overrule or modify St. Paul v. Wood.
For these reasons hereinafter stated we affirm the judgment.
We shall first treat appellant's second and third points before considering its first point.
Points II. and III.
Appellant argues that our holding in St. Paul Fire & Marine Ins. Co. v. Wood, 242 Ark. 879, 416 S.W.2d 322, does not control here because the workmen's compensation carrier intervened in that action and was present during all negotiations, while no offer was ever made to appellant by the carrier in this case. Our decision in the cited case did not wholly turn upon this consideration. The question there was stated in the first paragraph of the opinion, thus:
This appeal calls for construction of § 40 of the Workmen's Compensation Act (Ark.Stat.Ann. § 81-1340 [Repl.1960]) to determine whether an employee can settle his common law cause of action in negligence against a tortfeasor free of any claims of his employer's Workmen's Compensation carrier, where the settlement documents specifically preserve all rights of the carrier.
The workmen's compensation carrier's position, on appeal, was thus stated:
For reversal, St. Paul relies on one pointi. e., the court should have denied the action of plaintiff for a declaratory judgment and granted St. Paul's statutory lien against the settlement proceeds. *182 Our holding was based largely upon our determination that the word "recovery," in the sense that it and the verb form "recovered" are used in Ark.Stat.Ann. § 81-1340 (a) and (b), relates to restoration or vindication of a right existing in a person by the formal judgment or decree of a competent court, at his instance and suit, unless specifically qualified by accompanying words. We pointed out the distinction made between a recovery under § 81-1340 (a) and (b) and a settlement under § 81-1340(c) in Winfrey & Carlile v. Nickles, Admr., 223 Ark. 894, 270 S.W.2d 923. We also said that a compromise settlement that extinguished the rights of the compensation carrier was tantamount to a recovery, under § 81-1340(a) and (b), citing Maxcy v. John F. Beasley Construction Co., 228 Ark. 253, 306 S.W.2d 849. Ultimately, in affirming the trial court we said that the compensation carrier in Wood had no lien upon the proceeds of the settlement negotiated, that the workmen's compensation carrier had all the right of subrogation against the third party that was given it by law and all that it would have had if Wood had taken no action whatsoever. We noted that nothing in Ark.Stat.Ann. § 81-1340 prevented Wood from taking a nonsuit. We also pointed out that to interpret § 81-1340 as the carrier argued would require us to hold that the statute gives the employer or his compensation carrier a first lien upon receipts of any monies received from the third party by suit or otherwise, but that the statute does not so read.
The attorneys representing all the parties who participated in the settlement of the McCluskey suit in Federal court clearly thought that the decision in Wood gave the tortfeasor and the injured employee complete freedom to make any settlement of the case they agreed upon without consulting the employer or workmen's compensation carrier, so long as recognition was given to the right of the employer or carrier who was paying, or had paid, benefits to the employee to pursue its own statutory cause of action against the third-party tortfeasor. It is also apparent that the Workmen's Compensation Commission so construed that decision. Even though the circuit judge expressed his personal disagreement with the majority position in Wood, he felt that it was controlling in this case and required an affirmance of the Commission's holding. The United States District Court for the Eastern District of Arkansas has interpreted our holding in Wood to mean that § 81-1340(a) and (b) do not apply where the tort claim is settled without litigation or prior to judgment. Boehler v. Insurance Company of North America, D.C., 290 F.Supp. 867 (1968). There are members of this court who participated in that decision, both on the majority and minority sides, who also construe the Wood opinion to permit such a settlement between the employee on the one hand, and the employer and carrier on the other. We may be sure that many, many such settlements have been made in complete reliance upon this construction of Wood during the four years intervening between the Wood decision and the circuit court's affirmance in this case. We cannot say that there was error in the application of Wood made by the attorneys for McCluskey, Weiman and Reynolds and its liability insurance carrier, and by the Workmen's Compensation Commission and the circuit judge. In reaching this conclusion, however, we point out that appellant does not argue that the requirements of Ark.Stat.Ann. § 81-1340(c) have any application here or that they dictate a different result. We find no reference to this subsection in the referee's opinion, the full Commission opinion, in the circuit judge's opinion, or in appellant's brief.
Appellant does argue, however, that our holding in Wood should be overruled or modified for the reason that it is manifestly unfair to a workmen's compensation carrier, because it has a poor chance to recover when a suit is conducted in its name. Our decision in that case involved the construction *183 of a statute which has not been amended in either of two regular sessions of the General Assembly intervening between that decision and this. We have no inclination to overrule it, and have no hesitation in holding that the parties in the suit against the third-party tortfeasors were justified in relying upon their construction of that decision.
In urging modification, appellant suggests that we hold that third-party tortfeasors should not be allowed to settle with an employee, unless and until the same "percentage offer" is made to the workmen's compensation carrier. Appellant agrees that the principles of St. Paul v. Wood were properly applied in that case because the carrier there was demanding substantially more than the injured employee was willing to accept. Still, says appellant, the employee should not be able to settle and leave the compensation carrier out in the cold. We are unwilling to accept the premise that an insurance carrier cannot recover in a proper case, even if we should eventually hold, as we have not, that such a carrier must prosecute in its own name its subrogation claim for benefits paid and those ultimately to be paid because of our real party in interest statute [Ark.Stat.Ann. § 27-801 (Repl. 1962)].
Although we do not feel that our holding in Wood should be modified as appellant suggests, we are impressed with appellant's argument about the fundamental unfairness inherent in permitting an injured employee to make such a settlement as was made here, under the circumstances which existed. In Wood, the carrier had intervened, but the tortfeasor and the compensation carrier were unable to agree upon a settlement of the subrogation rights. While we there emphasized the difference between a recovery under § 81-1340 (a) or (b) and a compromise settlement under § 81-1340(c), we did point out that (c) was controlling where there is any type of termination of an action against a third-party tortfeasor prior to the rendition of a judgment against the third-party. We also noted that the trial court had, in the very proceeding we were reviewing, approved the settlement between Wood and the third-party tortfeasor. We did say in Wood that § 81-1340 does not so read as to require a holding that the statute gives the employer or compensation carrier a first lien upon receipts of any monies received from the third party by suit or otherwise. We also said in Winfrey & Carlile v. Nickles that subsection (c) does not apply to a contested suit between the employee and the compensation carrier.
We have held that, where a settlement was made by an injured employee with a third-party tortfeasor before the filing of a workmen's compensation claim, § 81-1340(c) was not applicable to the third-party tortfeasor. Hartford Insurance Group v. Carter, 251 Ark. (December 20, 1971), 473 S.W.2d 918. The application of those cases should be confined to the particular situations there involved. Fundamental fairness, justice and reason dictate that subsection (c) should apply to any settlement. We have already said in Carter, decided well after the circuit court acted in the case now before us, that St. Paul Fire & Marine Ins. Co. v. Wood involved a compromise having court approval pursuant to subsection (c). We also said that the purpose of this subsection was to permit the adjustment of such controversies between the employee and employer as existed in Wood and to require that settlements as between them have the approval of either the court or the Workmen's Compensation Commission.
Since the statutory purpose of § 81-1340 is to protect the rights of both the compensation carrier and the employee, we shall hereafter interpret Wood to require that as between the employer (or carrier) and employee, the proceeds of any compromise settlement of a tort claim be subject to the lien of the employer or the compensation *184 carrier unless the settlement has been approved by a court having jurisdiction or by the Workmen's Compensation Commission, after the compensation carrier has been afforded adequate opportunity to be heard.
Point I.
Appellant argues that appellee is estopped by the conduct of his attorney from denying that Travelers is entitled to a lien upon the net proceeds of the settlement received by him. In making this argument, appellant asserts that: appellee's attorney was given the choice of "honoring" appellant's subrogation interest or having appellant intervene in the action, and agreed to "honor" the subrogation, as evidenced by the letter of confirmation set out above; appellee's attorney agreed to handle the interest of appellant in return for appellant's attorney agreeing not to intervene, in order to enable appellee to prevent any mention of the payment of workmen's compensation benefits in the presence of the jury at the trial against the third parties; in reliance upon the representation that its subrogation rights would be "honored," appellant did not intervene. In making this argument, appellant's definition of the verb "honor" differs from ours. It relies upon the definition of the word as a noun, and asserts that implicit in the alleged agreement was an understanding that appellant's attorney would handle the claim for appellant. We understand the verb "honor" in the context in which it is used to be synonymous with the words esteem, respect and recognize. See Webster's New International Dictionary, Second and Third Editions. At least, it was not unreasonable for the word to be given such a meaning. Be that as it may, we have held that the doctrine of estoppel cannot be applied when anything is left to inference, argument or intendment. Ford Motor Credit Co. v. Exchange Bank & Trust Co., 251 Ark. (January 31, 1972), 476 S.W.2d 208. We said that the party setting up an estoppel must prove it strictly, that there must be certainty to every intent, that the facts constituting it must not be taken by argument or inference and that nothing can be supplied by intendment.
Even though appellant hinges its argument on this point upon the letter from Matthews to Woods and the subsequent motion of appellee's counsel to prevent mention of workmen's compensation payments in the tort action, it has been suggested that estoppel may be based upon subsequent communications between the appellant's representatives and appellee's attorney. Yet these subsequent communications seem to be at least as consistent with appellee's position as with appellant's. Letters went from Matthews to Woods on March 5, 1969, September 9, 1969, and October 29, 1969, the texts of which read:
If you get to the point where it appears that this case may be settled, please call me as Travelers has made additional payments since my letter of January 3, 1969.
* * * * * *
Since our letter of May 30, 1969, we have paid numerous bills. Would you please advise us of the status of the third party action and if we may be of help, feel free to call us.
* * * * * *
As you probably know, Travelers has paid a lot of money to Mr. McCluskey under the Workmen's Compensation coverage since the suit was filed.
Prior to serious settlement negotiations, please call me or Bill Stringfellow so we can give you an up to date figure on the WCC subrogation.
On the eve of trial, the information mentioned in the previous correspondence was furnished by a letter from W. R. Stringfellow, Supervising Adjuster for appellant, a copy of which went to Matthews. Stringfellow *185 admitted that Woods had said that the trial would take place in a day or two when he requested the up-to-date statement of medical expenses. The stated purpose for requests for a call prior to settlement negotiations could well be taken to have been accomplished.
Appellee argues forcefully that his attorney did exactly what he impliedly agreed to do, i. e., "honor" the subrogation rights of appellant by preserving them when confronted with an offer advantageous to appellee, which did specifically exclude any offer to the workmen's compensation carrier. We certainly cannot say that this argument is groundless. Under the principles stated in Ford Motor Credit Co. v. Exchange Bank & Trust Co., supra, we cannot declare an estoppel as a matter of law in this case. Even if the evidence is taken to present a question of fact, we cannot say that the finding of the commission adverse to appellant was without substantial evidentiary support. The commission found that the only agreement between the attorneys in this case was that the subrogation rights of appellant would be protected and that they were protected by providing in the settlement that appellant could file and prosecute any claim it might have, thus clearly rejecting the referee's finding that there was an estoppel.
We do not consider that appellant's effort to establish a custom or course of dealing between appellant and appellee's attorney in other cases requires us to hold that appellee was estopped. It is at least doubtful that appellee could be estopped by a course of conduct followed by his attorney in matters wholly apart from the attorney's employment by the client. There is nothing whatever to show that McCluskey had any knowledge or notice of this custom or course of dealing. But even if appellee could be bound, appellant did not show such a course of dealing as would enable us to apply the doctrine of estoppel as a matter of law. In an endeavor to establish such a custom, appellant introduced one letter addressed by its attorneys to the McMath firm in December 1967, in which Woods was specifically asked to advise if he wanted the Terral firm to intervene, or if he would protect Travelers' statutory lien without charge. This is a request far different from any implied from the correspondence relating to this case. Matthews testified that he had the same agreement with Woods in every case in which Travelers had a lien as that evidenced by the letter introduced. The case referred to in this letter resulted in a judgment in favor of the injured employee and a substantial payment was made to Travelers out of that recovery. Stringfellow testified that there had been a number of cases in which Woods had obtained judgments in which Travelers had a subrogation interest. He was unable to recall any where settlement was reached during trial, and particularly when settlements negotiations arose suddenly during trial. We could not say that this evidence established an estoppel as a matter of law.
Appellant advocated a theory upon oral argument not theretofore advanced at any stage of the proceeding. It was that appellee was a trustee for appellant in the matter and that this action violated his fiduciary duties to appellant, entitling appellant to a lien on the settlement proceeds. It relies upon McGeorge Contracting Co. v. Mizell, 216 Ark. 509, 226 S.W.2d 566. We cannot consider an argument made for the first time on appeal. Rhodes v. Earl Gill Enterprises, 245 Ark. 279, 431 S.W.2d 846. Furthermore, the authority relied upon was not mentioned in appellant's brief and not furnished to opposing counsel prior to argument as our rules require. Rule 18(j), Supreme Court Rules, Supplement 1971, Volume 3A, Arkansas Statutes Annotated. We may say, however, that, in McGeorge the third-party tortfeasor was seeking to compel the workmen's compensation carrier to be made a party to an action against the tortfeasor by the injured employee. *186 We held that this was not required by our "real party in interest" statute, based upon the dual bases of the insured's relation of trustee toward the insurer and the right of the wrongdoer not to have the cause of action against him split. We have specifically approved the splitting of the cause of action by settlement in a case such as this in St. Paul Fire & Marine Ins. v. Wood, 242 Ark. 879, 416 S.W.2d 322. Distinctions made in Wood are also applicable here with reference to the trust relationship, because it was held, in McGeorge, to apply to the proceeds of recovery by judgment. We also said that a settlement which extinguishes the insurer's rights is tantamount to a recovery by judgment.
While appellant nowhere argues that by the steps taken after appellee's tort suit was filed it did "join in such action" as it was entitled to do, it has been suggested that this is the case. This court has always referred to this procedure as if the words "join in" meant intervene. See McGeorge Contracting Co. v. Mizell, supra; Winfrey & Carlile v. Nickles, 223 Ark. 894, 270 S.W.2d 923. In McGeorge we said: "An insurance company would be a proper party plaintiff should it so request, or intervene, but it would not be a necessary or indispensable party." After saying in Winfrey that Ark.Stat.Ann. § 81-1340 recognizes separate causes of action in the compensation beneficiary and in the compensation carrier, we added:
By subsection (a) the compensation beneficiary is permitted to institute the action, with notice to the carrier so that it may intervene.
Actually intervention is the only means recognized for one who was not joined as a plaintiff by the party filing an action to "join in such action." In Gorham v. Hall, 172 Ark. 744, 290 S.W. 357, we said:
Intervention, in practice, is a proceeding in a suit or action by which a third person is permitted by the court to make himself a party. In practice an intervention is the admission by leave of court of a person, not an original party to the pending legal proceeding, by which such person becomes a party thereto for the protection of some right or interest alleged by him to be affected by such proceeding. Literally, an intervention means the act or fact of intervening; any interference that may affect the interest of othersinterposition. Webster's International Dict.; 33 C. J. 476. See, also, 20 R. C. L. 682, where "interpleader" and "intervention" are defined and the distinction drawn between them.
The subject is also treated in 59 Am.Jur. 2d, Parties, §§ 129, 130, at p. 552, et seq., viz:
Persons who are not parties of record to a suit have no standing therein which will enable them to take part in or control the proceedings. If they have occasion to ask relief in relation to the matters involved, they must either contrive to obtain the status of parties in such suit or they must institute an independent suit.
* * * * * *
By the process of "intervention" a person not originally made a party may be permitted on his own application to obtain the status of a party to the previously instituted action. The purpose of the procedure is to enable anyone having an interest in a subject of litigation to interject himself into the case in timely season to protect his rights and to obviate delay and multiplicity of actions.
* * * * * *
The term "intervention" with reference to judicial proceedings has a settled *187 meaning, namely, the act by which a third party becomes a party in a suit pending between other persons, or, more specifically, the act by which a person not a party to a pending action voluntarily or by his own application becomes a party thereto.
Literally, an "intervention" means the act or fact of interveningany interference that may affect the interest of others. In legal terminology, "intervention" is the proceeding by which one not originally a party to an action is permitted, on his own application, to appear therein and join one of the original parties in maintaining the action or defense, or to assert a claim or defense against some or all of the parties to the proceeding as originally instituted. Stated another way, "intervention" is the admission by leave of court of a person not an original party to the pending legal proceeding, by which such person becomes a party thereto for the protection of some right or interest alleged by him to be affected by such proceeding.
It can readily be seen that appellant did not "join in such action." Actually, appellant's argument that it was entitled to a lien by estoppel is premised upon the theory that it did not join in the action, in reliance on acts and conduct of appellee's counsel. The theory that appellant did, in effect, join in the action is inconsistent with its theory of estoppel.
It is indeed regrettable that any misunderstanding should arise between two capable and reputable attorneys. But we cannot compensate for losses sustained as a result of such an unfortunate difference, except as permitted by application of legal principles. Under the governing law in this case, we must affirm the judgment.
GEORGE ROSE SMITH and BROWN, JJ., dissent as to Point I. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563852/ | 558 S.W.2d 2 (1977)
Jorge BASALDUA, Appellant,
v.
The STATE of Texas, Appellee.
No. 54427.
Court of Criminal Appeals of Texas.
November 2, 1977.
Motion for Rehearing Denied November 30, 1977.
*3 James C. Harrington, San Juan, for appellant.
Oscar McInnis, Dist. Atty. and Terry D. Key, Asst. Dist. Atty., Edinburg, for the State.
State's Motion for Rehearing Denied November 30, 1977.
OPINION
ONION, Presiding Judge.
This is a purported appeal from an order refusing to alter or modify conditions of probation.[1]
On July 7, 1975 appellant entered a guilty plea before the court after having waived trial by jury for the offense of possession of a usable quantity of marihuana of more than four ounces. His punishment was assessed at three (3) years in the Department of Corrections and a fine of $200.00. The imposition of the sentence was suspended and the appellant was placed on probation for three (3) years subject to certain probationary conditions, which included:
"h. Pay his fine, if one be assessed, and all court costs including $100.00 attorney's fees (Court appointed attorney) whether a fine be assessed or not, in one or several sums, and make restitution or reparation in any sum that the Court shall determine...
"$100 attorney fees payable $10 per month starting Aug. 1, 1975.
"h-1. Submit his person, place of residence and vehicle to search and seizure at any time of the day or night, with or without a search warrant whenever requested to do so by the Probation Officer or any other law enforcement officer."
It appears that at the time of the imposition of these conditions the appellant and his court-appointed counsel objected to these particular conditions but no appeal was taken at that time.
On November 3, 1975 the appellant filed a motion to modify conditions of probation asking that the two conditions be stricken from the order granting probation. A hearing on the motion was held on January 8, 1976, and the court took the matter under advisement. On March 23, 1976 the court denied the motion, and on April 1, 1976 the appellant gave notice of appeal from the *4 order refusing to alter or modify the conditions of probation.
We are confronted initially with the procedural question of whether an appeal lies from such an order.
Article V, § 5 of the Texas Constitution provides for the jurisdiction of the Court of Criminal Appeals as follows:
"The Court of Criminal Appeals shall have appellate jurisdiction coextensive with the limits of the state in all criminal cases of whatever grade, with such exceptions and under such regulations as may be prescribed by law.
"The Court of Criminal Appeals .. shall have the power to issue the writ of habeas corpus, and under such regulations as may be prescribed by law, issue such writs as may be necessary to enforce its own jurisdiction...."
Under such constitutional provision, the Legislature has the power to make proper exceptions to the right of appeal in criminal cases and regulate the appellate jurisdiction of the Court of Criminal Appeals, see Walker v. State, 537 S.W.2d 36, 38 (Tex.Cr.App.1976); De Silva v. State, 98 Tex. Crim. 499, 267 S.W. 271 (1924), and also to provide which writs the court may issue to enforce its own jurisdiction. Walker v. State, supra.
Article 4.03, Vernon's Ann.C.C.P., provides:
"The Court of Criminal Appeals shall have appellate jurisdiction coextensive with the limits of the State in all criminal cases. This Article shall not be so construed as to embrace any case which has been appealed from any inferior court to the county court, the county criminal court, or county court at law, in which the fine imposed by the county court, the county criminal court or county court at law shall not exceed one hundred dollars."
Article 4.04, Vernon's Ann.C.C.P., provides:
"Sec. 1. In addition to the power and authority now vested in the Court of Criminal Appeals of the State of Texas, said court and each member thereof shall have, and is hereby given, power and authority to grant and issue and cause the issuance of writs of mandamus and certiorari agreeable to the principles of law regarding said writs, whenever in the judgment of said court or any member thereof the same should be necessary to enforce the jurisdiction of said court."
In Walker v. State, supra, it is stated:
"It is clear from the above constitutional and statutory provisions that the Court of Criminal Appeals has appellate jurisdiction in all criminal cases in the State with the exception made by law in Article 4.03, supra, relating to cases originating in the Justice of the Peace and Municipal Courts and tried de novo in a County Court where the fine then assessed is $100.00 or less. Bridges v. State, 423 S.W.2d 931 (Tex.Cr.App.1968); Leggio v. State, 489 S.W.2d 622 (Tex.Cr. App.1973). See also Article 4.03, supra, note # 7, and cases there cited.
"It is also clear from the constitutional provisions that the Court of Criminal Appeals and the Judges thereof have general authority to issue the writ of habeas corpus. Further, it may, as prescribed by law, issue such writs as may be necessary to enforce its own general jurisdiction. See Article 4.04, supra. See also State ex rel. Smith v. Blackwell, 500 S.W.2d 97 (Tex.Cr.App.1973); Ex parte Giles, 502 S.W.2d 774 (Tex.Cr.App.1973). The right of the court to issue writs, other than habeas corpus, is thus limited."
Further, it is established by statute that the Court of Criminal Appeals may review bond forfeiture in criminal cases by appeal or writ of error from a final judgment forfeiting the bail bond. See Articles 44.42, 44.43, 44.44, Vernon's Ann.C.C.P.; Walker v. State, supra; Glenn v. State, 155 Tex. Cr.R. 498, 236 S.W.2d 809 (1951); Kubish v. State, 128 Tex. Crim. 666, 84 S.W.2d 480 (1935); Hodges v. State, 73 Tex. Crim. 638, 165 S.W. 607 (1913); Jeter v. State, 86 Tex. 555, 26 S.W. 49 (1894); Swanson v. State, 169 Tex. Crim. 390, 334 S.W.2d 179 (1960).
*5 The Court of Criminal Appeals will not exceed its jurisdiction as stated in 15 Tex.Jur.2d, Courts, § 23, p. 445:
"... When a proceeding from which an appeal is attempted comes within none of the statutory or constitutional provisions conferring jurisdiction, the court will not exercise authority ..."
We find neither constitutional nor statutory authority which would confer jurisdiction on this court to hear an appeal from an order entered pursuant to Article 42.12, § 6, supra (footnote # 1), altering or modifying probationary conditions or an order, as in the instant case, refusing to alter or modify such conditions. It must be remembered that this is not an appeal from an order granting probation, cf. Article 42.04, Vernon's Ann.C.C.P., nor is it an appeal from an order revoking probation. Article 42.12, § 8, Vernon's Ann.C.C.P. We conclude that this court lacks the authority to entertain a direct appeal from the order entered. See and cf. Walker v. State, supra; Hardin v. State, 157 Tex. Crim. 283, 248 S.W.2d 487 (1952); Morgan v. State, 135 Tex. Crim. 76, 117 S.W.2d 76 (1938); Griffin v. State, 29 S.W.2d 349, 350 (Tex.Cr.App.1930). See also Bretz v. State, 508 S.W.2d 97 (Tex.Cr. App.1974); Swanson v. State, supra.
Although the purported appellant has characterized the case as an appeal, he prays, by supplemental brief, that if this court decides that no appeal lies then the proceedings be considered as an application for writ of habeas corpus. He cites Ex parte Giles, 502 S.W.2d 774 (Tex.Cr.App. 1973), where the court was asked to issue a writ of mandamus which was beyond its jurisdiction since its jurisdiction was not endangered but where the court considered the pleadings as an application for writ of habeas corpus. If the facts raise a proper habeas corpus issue, then the proceedings should be considered as a habeas corpus proceeding since to dismiss the appeal and require a new and separate habeas corpus application would require a useless thing. See Rice v. State, 548 S.W.2d 725 (Tex.Cr. App.1977); Ramirez v. State, 486 S.W.2d 373 (Tex.Cr.App.1972); Taylor v. State, 482 S.W.2d 246 (Tex.Cr.App.1972).
We conclude that the facts raise a proper habeas corpus issue and fall within our habeas corpus jurisdiction.[2] See Ex parte Herrin, 537 S.W.2d 33 (Tex.Cr.App. 1976).
"The writ of habeas corpus is intended to be applicable to all ... cases of confinement and restraint, where there is no lawful right in the person exercising the power, or where, though the power in fact exists, it is exercised in a manner or degree not sanctioned by law." Article 11.23, Vernon's Ann.C.C.P. (Emphasis added.)
Article 11.22, Vernon's Ann.C.C.P., defines "restraint" as:
"... the kind of control which one person exercises over another, not to confine him within certain limits, but to subject him to the general authority and power of the person claiming such right." (Emphasis added.)
We conclude that the imposition of conditions of probation that contain unconstitutional infringements of freedom of action constitutes a "restraint" within the scope of habeas corpus relief. See Ex parte Guzman, 551 S.W.2d 387 (Tex.Cr.App.1977) (Concurring Opinion). Therefore, we will address appellant's constitutional arguments on the merits.
Appellant challenges the constitutionality of the Texas recoupment scheme which grants the trial court discretion to require, as a condition of probation, that a convicted defendant repay the county for providing him with court-appointed counsel.[3] Appellant argues that the plan *6 violates the due process clauses of the United States and Texas Constitutions; that it violates the equal protection clauses of the United States and Texas Constitutions by imposing harsher sanctions on appellant for not paying for his appointed counsel than are imposed on those persons who fail to pay their private attorneys; and finally, that so charging an indigent defendant interferes with the exercise of his right to counsel.
Appellant relies primarily on the authority of James v. Strange, 407 U.S. 128, 92 S. Ct. 2027, 32 L. Ed. 2d 600 (1972), and decisions from other jurisdictions, such as California and Michigan, which have invalidated particular recoupment schemes. He attempts to distinguish the more recent decision of the United States Supreme Court in Fuller v. Oregon, 417 U.S. 40, 94 S. Ct. 2116, 40 L. Ed. 2d 642 (1974), which upheld the Oregon recoupment plan. An examination of the Texas statutes and our interpretive decisions in the context of Fuller v. Oregon, supra, and James v. Strange, supra, convinces us that the Texas recoupment plan is constitutional.
James v. Strange, supra, concerned a Kansas recoupment statute[4] that allowed the State to recover, in subsequent civil proceedings, legal defense fees for indigent defendants. The Court invalidated the Kansas statute for its deficiencies in three areas: (1) unavailability to the defendant of exemptions provided for other judgment debtors by the Kansas Code of Civil Procedure; (2) without the exemptions, a defendant was subject to wage garnishment and was thus deprived of continuing means to support himself and his family; and (3) the statute provided for recoupment regardless of whether the indigent defendant was acquitted or convicted. Justice Powell noted that "[i]t is thus apparent that state recoupment laws and procedures differ significantly... Given the wide differences in the features of these statutes, any broadside pronouncement on their general validity would be inappropriate." 407 U.S. at p. 133, 92 S.Ct. at p. 2030. We believe the Texas recoupment plan differs significantly from the Kansas statute and is similar to the Oregon statute more recently upheld in Fuller v. Oregon, supra.
The Court in Fuller held that the Oregon statute, which provided the opportunity for a convicted defendant to show that legal costs would impose manifest hardship, did not violate the equal protection clause. The legislative decision not to impose repayment obligations on defendants who are not convicted or whose convictions are reversed was held to be an objectively rational one. Further, the Court held that the statute did not infringe on a defendant's right to counsel.
As the State in the case at bar points out, the constitutionality of the Oregon statute rested on several conditions. An examination of the Texas scheme reveals that it also satisfies these conditions. First, only a convicted defendant in Oregon may be ordered to pay court costs. Similarly, Article 42.12, §§ 3, 3a and 6, and Article 1018, Vernon's Ann.C.C.P., impose liability for payment of *7 costs only on a convicted defendant. Persons who are acquitted, whose trials end in mistrial or are dismissed and those whose convictions are overturned on appeal are not liable for costs in Texas.
Second, under the Oregon plan a convicted defendant cannot be forced to pay court costs unless he is or will be able to do so. Texas Article 1018, supra, imposes, as a matter of law, a charge on a convicted defendant for court costs and fees. Article 42.12(6)(h), Vernon's Ann.C.C.P., allows a court to impose as a condition of probation the requirement that a defendant "pay ... all court costs ... and make restitution or reparation in any sum that the court shall determine." However, repeated decisions of this court have made it clear that probation may not be revoked for failure to pay these costs unless the State shows that the probationer was able to make such payments and that his failure to do so was intentional. See, e.g., Herrington v. State, 534 S.W.2d 331 (Tex. Cr.App.1976); Denton v. State, 511 S.W.2d 311 (Tex.Cr.App.1974); Szczeck v. State, 490 S.W.2d 576 (Tex.Cr.App.1973). A recent amendment to Article 42.12, § 8, Vernon's Ann.C.C.P., now makes available to a probationer an affirmative defense if he can establish that he is unable to repay compensation paid to appointed counsel[5] and thus modifies prior case law. The result in Texas was and is consistent with the second condition stated in Fuller.
Third, a convicted person in Oregon may petition the court for remission of costs or of any unpaid portion thereof. While Texas law does not expressly authorize remission of costs, Article 42.12, supra, does allow the probationer to petition the court to modify the conditions of probation. This provides an opportunity for a probationer who is financially unable to pay costs to call his hardship to the court's attention and to have this condition modified or eliminated.
Finally, no convicted person in Oregon may be held in contempt for failure to repay if his default was not due to an intentional refusal to obey the court's order or to a failure to make a good faith effort to pay.
As discussed above, revocation for a probationer's failure to repay compensation for appointed counsel, costs, etc., is improper if the probationer establishes that he is unable to make such payments.[6]
We feel that the reasoning in Fuller adequately answers appellant's arguments concerning the constitutionality of the Texas recoupment plan. Therefore, appellant's first ground of error is overruled.
Appellant next argues that the trial court erred in denying his motion to remove the search and seizure condition of probation because it violates the United States and Texas Constitutions. We conclude that the condition in the instant case, identical to the one in Tamez v. State, 534 S.W.2d 686 (Tex.Cr.App.1976), is overbroad and does violate the probationer's rights under the Fourth and Fourteenth Amendments to the United States Constitution and Article I, § 9 of the Texas Constitution. A probationer, like a parolee, has the right to enjoy a significant degree of privacy. Tamez v. State, supra; United States v. Consuelo-Gonzalez, 521 F.2d 259 (9th Cir. 1975); Morrissey v. Brewer, 408 U.S. 471, 92 S. Ct. 2593, 33 L. Ed. 2d 484 (1972).
Habeas corpus relief is hereby partially granted; and it is ordered that the unconstitutional search and seizure condition be deleted from the terms and conditions of appellant's probation.
It is so ordered.
ODOM, Judge, concurring.
I concur in the conclusion of the majority that appellate jurisdiction does not lie in *8 this case, and that habeas corpus jurisdiction does lie. I also share the concern expressed by the dissent that some may misconstrue the majority opinion as creating an "expansion of our habeas corpus jurisdiction [that] will open a `Pandora's box' of frivolous claims." I do not, however, find the majority's conclusion "that the imposition of conditions of probation that contain unconstitutional infringements of freedom of action constitutes a `restraint' within the scope of habeas corpus relief" creates such a broad-reaching expansion as contended by the dissent. The majority find jurisdiction on appellant's tenable claims of unconstitutional conditions of probation, and do not open the door for all attacks that may be conceived, even if frivolous or not of constitutional magnitude.
It should be noted that habeas corpus may not be used as a substitute for appeal. Mixon v. State, Tex.Cr.App., 365 S.W.2d 364; Ex parte Eldridge, 154 Tex. Crim. 50, 224 S.W.2d 262; Ex parte Loper, 153 Tex. Cr.R. 240, 219 S.W.2d 81. The proper means to challenge the validity of a condition of probation imposed at conviction is by appeal from that conviction. This Court will consider such claims at that time. Morales v. State, Tex.Cr.App., 541 S.W.2d 443; Flores v. State, Tex.Cr.App., 513 S.W.2d 66; Faugh v. State, Tex.Cr.App., 481 S.W.2d 412; Milligan v. State, Tex.Cr. App., 465 S.W.2d 157. Only in special circumstances should habeas corpus be available to challenge the validity of a condition of probation imposed at conviction.
In the case at bar petitioner was convicted and placed on probation on July 7, 1975. The search and seizure condition of his probation (set out in the majority opinion) was imposed at that time. Tamez v. State, Tex. Cr.App., 534 S.W.2d 686, was decided on March 17, 1976, and held a probationary condition such as the one here was unreasonable and unenforceable. Because Tamez was decided after appellant's probation condition was imposed, he did not have benefit of that holding when he could have raised the issue on appeal. Petitioner should not be faulted for failing to anticipate this Court's decision in Tamez v. State, supra. Ex parte Taylor, Tex.Cr.App., 484 S.W.2d 748, 752; Ex parte Casarez, Tex.Cr.App., 508 S.W.2d 620, 622. For this reason I concur in the exercise of our habeas corpus jurisdiction in this case on the Tamez issue. Furthermore, with the case before us on this ground I concur in the decision to address the other issue raised by petitioner as well. Once jurisdiction is found, no purpose would be served by declining to decide the validity of the other challenged probation condition, particularly in light of the significance of the issue.
I therefore concur in the exercise of our habeas corpus jurisdiction to hear challenges to conditions of probation under the facts of this case.
DOUGLAS, Judge, dissenting.
This Court does not have jurisdiction to strike a condition of probation where there has been no appeal from the judgment of the original trial and where there has been no motion to revoke probation. After the time for appeal had expired, Basaldua asked the trial judge to delete a condition of probation, and he refused. From the refusal we have this purported appeal.
We do not have jurisdiction. Questions of jurisdiction are fundamentally questions of power. A court has no power to act where jurisdiction does not exist.
Habeas corpus jurisdiction is conferred on this Court by the Texas Constitution and by the Code of Criminal Procedure. Article 5, Sec. 5 of the Constitution provides in part:
"The Court of Criminal Appeals and the Judges thereof shall have the power to issue the writ of habeas corpus, and shall under regulations as may be prescribed by law, issue such writs as may be necessary to enforce its own jurisdiction..."
Article 11.23, V.A.C.C.P., provides:
"The writ of habeas corpus is intended to be applicable to all such cases of confinement and restraint, where there is no lawful right in the person exercising the power, or where, though the power in fact exists, it is exercised in a manner or *9 degree not sanctioned by law." (Emphasis added.)
The majority concludes that these provisions authorize Basaldua's collateral attack upon the search and seizure condition of probation. To the contrary, the statute expressly authorizes jurisdiction only where the applicant is in custody or under arrest. See Ex parte Guzman, 551 S.W.2d 387 (Tex. Cr.App.1977) (dissenting opinion).
The probationary condition in question requires that Basaldua "[s]ubmit his person, place of residence and vehicle to search and seizure at any time of the day or night, with or without a search warrant whenever requested to do so by the Probation Officer or any other law enforcement officer." The identical condition was declared constitutionally infirm in Tamez v. State, 534 S.W.2d 686 (Tex.Cr.App.1976).
However, the judgment in the instant case was entered on July 7, 1975, prior to the decision in Tamez. Heretofore the search and seizure condition has not been used against Basaldua. Although such condition is unlawful, we cannot act on his habeas claim without presuming that the probation or other officers will fail to follow the law in the future and will use the condition against the applicant.
There has been no showing of a pending threat to Basaldua's privacy. Under these circumstances, no restraint within the meaning of the statute exists, and, thus, the Court has no jurisdiction of his claim.
The majority relies on Rice v. State, 548 S.W.2d 725 (Tex.Cr.App.1977); Ramirez v. State, 486 S.W.2d 373 (Tex.Cr.App.1972); and Taylor v. State, 482 S.W.2d 246 (Tex. Cr.App.1972), for the proposition that both of Basaldua's claims raise proper habeas corpus issues, and that "the proceedings should be considered as a habeas corpus proceeding since to dismiss the appeal and require a new and separate habeas corpus application would require a useless thing." Those cases are not in point. In each of those the appellate jurisdiction of this Court was properly invoked.
The Ramirez case involved a revocation of probation. He did not have and did not waive counsel in the original trial. The Taylor case did not permit a collateral attack on the original conviction. In the Rice case the State conceded that jeopardy attached to a prior conviction. On appeal this Court set a void judgment aside. In those cases we were confronted with issues which could properly be raised by habeas corpus. The Court disposed of those issues in the interest of judicial economy.
In the instant case this Court has no appellate jurisdiction. Further, in those other cases the facts did raise a proper habeas claim and would invoke the Court's habeas corpus jurisdiction. In the present case, however, Basaldua's Fourth Amendment claim is not properly within our habeas corpus jurisdiction for the reasons previously stated.
Today's holding represents an unwarranted expansion of our habeas corpus jurisdiction and will open a "Pandora's box" of frivolous claims. Under the majority's reasoning, future probationers can collaterally attack probation orders by challenging any conditions of probation, statutory or otherwise, which present no real threat of confinement or restraint. Consider, for example, the many probationers who will now probably file for habeas corpus relief contending that conditions which prohibit them from associating with persons of "harmful character" are unconstitutionally vague.
Even assuming that we have jurisdiction of the Fourth Amendment claim, we should not issue a declaratory judgment and grant the relief sought when there is no showing of a pending threat to Basaldua's privacy. If the probationary condition is used against him in the future, and his probation is revoked, he can challenge it then on appeal.
A major constitutional revision has been proposed to alleviate the workload of this Court. The majority is aggravating the situation by passing on issues such as this. As the Presiding Judge and author of the majority opinion stated in a similar context:
"... Since the present information will therefore not likely be used, I see no *10 necessity for this Court, with the heaviest case load of any State appellate court in this nation, to write upon the sufficiency of an information that does not control the proper disposition of the case before this Court ..." Bullet v. State, 538 S.W.2d 785, 787 (Tex.Cr.App.1976).
If the majority is going to deal in the realm of possibilities, it is possible or even probable that one might appeal a refusal of a trial judge to act upon a motion to suppress evidence because it was obtained as a result of an illegal search. There would have been more restraint in that case than in the present case. In Bosley v. State, 414 S.W.2d 468 (Tex.Cr.App.1967), the writer of the majority opinion wrote for the Court that a trial judge did not have to pass upon the motion to suppress evidence but could consider the question during the trial. If there had been no other evidence except that obtained by the search, Bosley would have been under more of a restraint than Basaldua is because there has been no allegation that Basaldua has been or is about to be illegally searched.
Again in the realm of possibility, suppose that one learns that a search warrant has been issued for his building, and he seeks to have it vacated, but a judge will not do so. Under the opinion by the majority, he could appeal that decision because he is under restraint and an officer may violate his right to privacy.
Any time one has been charged for an offense and arrested, he is under some sort of restraint. However, this Court does not permit an attack upon his detention by habeas corpus unless the statute under which he is charged is void. Ex parte Brannon, 163 Tex. Crim. 311, 290 S.W.2d 914 (1956); Ex parte Merriell, 163 Tex. Crim. 534, 294 S.W.2d 400 (1956). There has to be a conviction and an appeal before his allegation of illegal detention is considered. There should not be a different rule in the present case. If his probation is revoked, he can appeal.
Since Tamez v. State, supra, has been decided, it is the law of this State, and Basaldua does not have to submit to the search. From his application for habeas corpus he knows that he does not have to submit to a search. He may inform any peace officer that he refuses to consent and that provision of probation may not be used against him. No judge confronted with a motion to revoke because a probationer refused to consent to search would revoke probation after being cited to Tamez, supra. If evidence is obtained as a result of an illegal search, it can be reviewed as in any other case where this Court has jurisdiction.
This Court does not have jurisdiction to pass upon this question, and it should so hold.
ROBERTS, J., joins in this dissent.
NOTES
[1] Article 42.12, § 6, Vernon's Ann.C.C.P., provides in part:
"The court having jurisdiction of the case shall determine the terms and conditions of probation and may, at any time, during the period of probation alter or modify the conditions...."
[2] It has been said that the original jurisdiction of this court to issue writs of habeas corpus is unlimited. State v. Briggs, 171 Tex. Crim. 479, 351 S.W.2d 892, 894 (1961). See also Article 11.05, Vernon's Ann.C.C.P.
[3] See Articles 42.12 and 1018, Vernon's Ann.C. C.P. On August 29, 1977 the amendment to § 6, Article 42.12, Vernon's Ann.C.C.P., became effective (Acts 1977, 65th Leg., ch. 388, p. 1058). This amendment expressly provides that one of the suggested conditions of probation may be:
"(j) Reimburse the county in which the prosecution was instituted for compensation paid to appointed counsel for defending him in the case, if counsel was appointed."
Thus, the reimbursement for appointed counsel will not have to be included as court costs. This amendment has no bearing on the issue to be decided here.
[4] Justice Powell described the operation of the statute in this fashion:
"When the State provides an indigent defendant with counsel or other legal services, the defendant becomes obligated to the State for the amount expended in his behalf. Within 30 days of the expenditure, the defendant is notified of his debt and given 60 days to repay it. If the sum remains unpaid after the 60-day period, a judgment is docketed against defendant for the unpaid amount... The indigent defendant is not, however, accorded any of the exemptions provided by that code [the Kansas Code of Civil Procedure] for other judgment debtors except the homestead exemption...." [Footnotes from Justice Powell's opinion are omitted.] 407 U.S. at pp. 130-131, 92 S.Ct. at p. 2029.
[5] Article 42.12, § 8(c), now reads:
"(c) In a probation revocation hearing at which it is alleged that the probationer violated the conditions of probation by failing to pay compensation paid to appointed counsel, probation fees, court costs, restitution, or reparations, the inability of the probationer to pay as ordered by the court is an affirmative defense to revocation, which the probationer must prove by a preponderance of evidence." (Acts 1977, 65th Leg., ch. 388, p. 1058 [S.B. 61], effective August 29, 1977)
[6] See footnote # 5. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563874/ | 960 A.2d 697 (2008)
The STATE of New Hampshire
v.
Diego DURAN.
No. 2007-611.
Supreme Court of New Hampshire.
Argued: October 15, 2008.
Opinion Issued: December 5, 2008.
*699 Kelly A. Ayotte, attorney general (Thomas E. Bocian, attorney, on the brief and orally), for the State.
David M. Rothstein, deputy chief appellate defender, of Concord, on the brief, and Theodore Lothstein, assistant appellate defender, orally, for the defendant.
DUGGAN, J.
After a jury trial in the Superior Court (Hampsey, J.), the defendant, Diego Duran, was convicted of manslaughter. See RSA 630:2 (2007). He appeals his conviction, arguing that the State presented insufficient evidence to support a jury instruction on accomplice liability. See RSA 626:8, III (2007). He also appeals the trial court's decision to exclude from the calculation of his pretrial confinement credit time he spent awaiting extradition from Colombia. See RSA 651:3, I (2007); RSA *700 651-A:23 (2007). We affirm in part, reverse in part and remand.
The following facts appear in the record. In October 2002, the defendant, a Colombian national, was living in Nashua. Zulkerine Torres and Frank Ledesma lived next door in a house owned by Simon Concepcion. On the evening of October 26, they invited the defendant out to Tu Casa, a restaurant and nightclub in Nashua. While at the club, the defendant was introduced to Luis Otero Rivera (Otero), another Colombian national. The defendant and Otero were from regions with a history of animosity toward each other, and began arguing over which region was better, trading insults and epithets. Eventually, the two stopped arguing but continued to drink heavily.
Later, the defendant and Otero resumed their argument outside Tu Casa. The defendant punched Otero, who fell to the ground. The defendant went into the club and returned with Concepcion. Otero was still on the ground in the alley. The defendant grabbed onto a ledge on a wall and used it to steady himself as he jumped on Otero's head. Concepcion admitted that his foot touched Otero's head at some point, leaving blood on his shoe. The defendant and Concepcion then reentered the club.
Back inside, Concepcion told Ledesma they had beaten somebody up, asked if he wanted to see and showed him the body. Later, Ledesma saw Concepcion speaking with a group of people and making a stomping motion with his foot while talking.
A patron later found Otero in the alley and told the owner to call the police. When the police arrived, Ledesma, Concepcion and the defendant went out the back. The police found Otero alive, but unconscious. He died about six weeks later. The medical examiner ruled the death a homicide caused by blunt force head trauma resulting from at least two blows.
After Torres left the club, she met Ledesma and Concepcion and drove them to a party. Ledesma then asked her to go buy cigarettes for him. En route, she saw the defendant and stopped to give him a ride. He got into the back of her car, telling her he did not want to sit in the front because people were looking for him. When they heard a helicopter, he told Torres to drive faster, saying the helicopter was looking for him because he had just killed that "hijo de puta" (son of a bitch). He said he had struck Otero in the head, threw him against a wall and kicked him. He offered to show Torres the blood on his shoes, but she was unable to see. Later that night, Concepcion passed out. Ledesma carried him home and noticed blood on his shoe.
Some time after the assault, the defendant went to a friend's house to sleep and borrow some money. While speaking with his friend, he said that he had killed somebody in Nashua. Later, he told another friend that he had been in a fight with another Colombian and had punched him in the face and kicked him in the head. The defendant eventually returned to Colombia.
Colombian authorities arrested him on May 3, 2004, on an international arrest warrant. After his arrest, the defendant challenged his extradition to New Hampshire. On March 17, 2005, Colombia granted extradition, and on October 21, 2005, the defendant was transferred from Colombia to New Hampshire. The Nashua detective accompanying him on his flight from Miami to New Hampshire testified that the defendant said, "That thing up there in Nashua, I was drunk and I had been taking drugs."
*701 At the conclusion of the trial, the State requested a jury instruction on accomplice liability. The trial court, over the defendant's objection, gave the instruction. The jury returned a guilty verdict on manslaughter. The trial court sentenced the defendant to fifteen to thirty years in prison. During the sentencing hearing, the defendant argued that his time spent awaiting extradition in Colombia should be credited toward his pretrial confinement. Relying upon our decision in State v. Harnum, 142 N.H. 195, 697 A.2d 1380 (1997), the trial court refused to grant pretrial confinement credit for any time prior to the Nashua Police taking custody of the defendant in Miami. This appeal followed.
On appeal, the defendant makes two arguments. First, he argues that there was insufficient evidence to support a jury instruction on accomplice liability. Second, the defendant argues that he should have been credited for his pretrial confinement while awaiting extradition from Colombia and asks us to overrule our decision in Harnum.
I
A trial judge's decision to give a jury instruction must be based upon "some evidence to support a rational finding in favor of that [instruction]." State v. Larose, 157 N.H. 28, 33, 944 A.2d 566 (2008) (quotation omitted). "`Some evidence' means more than a minutia or a scintilla of evidence." Id. "To be more than a scintilla, evidence cannot be vague, conjectural, or the mere suspicion about the existence of a fact, but must be real and of such quality as to induce conviction." Id. (quotation omitted). The trial judge's decision to give the State's requested instruction on accomplice liability must, therefore, have been based upon some evidence in the record to support a rational finding of accomplice liability.
We review a trial court's decision to give a jury instruction for an unsustainable exercise of discretion. State v. Lavoie, 152 N.H. 542, 547, 880 A.2d 432 (2005). To prevail, the defendant must show that the trial court's ruling was clearly untenable or unreasonable to the prejudice of his case. State v. Yates, 152 N.H. 245, 249, 876 A.2d 176 (2005).
RSA 626:8 provides, in relevant part:
III. A person is an accomplice of another person in the commission of an offense if:
(a) With the purpose of promoting or facilitating the commission of the offense, he solicits such other person in committing it, or aids or agrees or attempts to aid such other person in planning or committing it;
....
IV. Notwithstanding the requirement of a purpose as set forth in paragraph III, when causing a particular result is an element of an offense, an accomplice in the conduct causing such result is an accomplice in the commission of that offense, if he acts with the kind of culpability, if any, with respect to that result that is sufficient for the commission of the offense.
The State must prove the elements of both section III and section IV. State v. Anthony, 151 N.H. 492, 493-95, 861 A.2d 773 (2004). Section III contains dual requirements that the defendant act with the purpose of promoting the commission of the offense and that he actually solicit or aid or attempt to aid another in its commission. Thus, to prove accomplice liability, the State must prove that: (1) the accomplice had the purpose to make the crime succeed; (2) the accomplice's acts solicited, aided or attempted to aid another in committing the offense; and (3) under section IV, the accomplice shared the requisite *702 mental state for the offense. Anthony, 151 N.H. at 493-95, 861 A.2d 773; see State v. Burke, 122 N.H. 565, 570, 448 A.2d 962 (1982); State v. Goodwin, 118 N.H. 862, 866, 395 A.2d 1234 (1978).
The defendant argues there was no evidence upon which to base the request for the accomplice liability instruction. He argues that any testimony Ledesma offered at trial about the defendant and Concepcion's complicity was rebutted by Ledesma's prior deposition testimony, leaving the jury to speculate as to any relationship between the two. He argues that the State's theory throughout the case was that the defendant caused Otero's death and the State never introduced evidence tending to show he was an accomplice with Concepcion, while the defense argued Concepcion had committed the crime alone.
We begin by noting that even if the State's theory at trial focused on the defendant as the primary actor, we have previously determined that such a theory puts the defendant on notice to prepare a defense as to principal or accomplice liability. See State v. Barton, 142 N.H. 391, 395, 702 A.2d 336 (1997) (noting abandonment of common law distinctions between principal and accomplice, and holding that indictment as a principal "is sufficient to allow defendant to prepare a defense to the substantive offense for principal or accomplice liability"). The issue before us is whether there is sufficient evidence to warrant an instruction on accomplice liability. The fact that the State's primary theory at trial was that the defendant acted as a principal does not change our analysis.
After reviewing the evidence, we conclude that there was "some evidence" supporting all three elements of accomplice liability. First, the State introduced evidence that the defendant had the purpose to make the crime succeed. See Goodwin, 118 N.H. at 866-67, 395 A.2d 1234 (defendant's presence had the purpose of ensuring the crime succeeded by encouraging the other offender). Concepcion testified that he was present when the defendant kicked Otero and there was testimony from multiple witnesses that Concepcion had blood on his shoe after the event. Ledesma testified that Concepcion told him "they" had beaten somebody in the alley. The defendant argues that this testimony was rebutted by Ledesma's deposition testimony. This argument, however, goes to the credibility of the witness and the proper weight to be given to the evidence, not the sufficiency of the evidence to warrant an instruction. See State v. Huard, 138 N.H. 256, 259, 638 A.2d 787 (1994) ("Common sense evaluation of the credibility of witnesses ... is the province and obligation of the jury."). The State thus introduced evidence that the defendant was in the alley for the purpose of making the crime succeed and not as a mere bystander, satisfying the first element.
Second, the State introduced evidence that Concepcion and the defendant were in the alley together, and that the latter jumped up and down on Otero's head. Indeed, the defendant told Torres that he had struck Otero in the head, threw him against a wall and kicked him. Such acts aided the commission of the offense, supporting the second element. See Burke, 122 N.H. at 570, 448 A.2d 962 (defendant aided armed robbery when arrived with others, was present during robbery, threatened to tear telephone from the wall, and left with two other defendants).
Finally, the State presented evidence showing that the defendant possessed the requisite mens rea for manslaughter, recklessness. See RSA 630:2, I(b); RSA 626:2, II(c) (2007). As noted above, there was testimony that the defendant repeatedly *703 jumped up and down on Otero's head as he lay unconscious in the alley. There was, therefore, "some evidence" that would support a rational conclusion that the defendant acted recklessly.
Because there was more than a minutia or scintilla of evidence supporting all three requirements for accomplice liability, it was not an unsustainable exercise of discretion for the trial judge to give the instruction.
II
The defendant next argues that we should overrule our decision in Harnum, thereby entitling him to credit for his pretrial confinement in Colombia while awaiting extradition.
In Harnum, the defendant was arrested in Florida for a New Hampshire probation violation and later extradited to New Hampshire, tried and convicted. Harnum, 142 N.H. at 196, 697 A.2d 1380. The court held that a defendant receives pretrial confinement credit only for that time spent "awaiting and during trial" and in the "custody" of New Hampshire authorities. Id. at 197-98, 697 A.2d 1380.
Harnum construed RSA 651-A:23 (1996) and RSA 651:3, I (1996) to conclude that a defendant is awarded pretrial credit only for time spent in the physical custody of New Hampshire authorities, and not that "awaiting extradition." Id. RSA 651:3, I, provides, in relevant part:
All the time actually spent in custody prior to the time [the defendant] is sentenced shall be credited in the manner set forth in RSA 651-A:23 against the maximum term of imprisonment that is imposed and against any minimum term authorized by RSA 651:2 or 6.
(Emphasis added.) RSA 651-A:23 provides, in relevant part:
Any prisoner who is confined to the state prison, any house of correction, any jail or any other place shall be granted credit against both the maximum and minimum terms of his sentence equal to the number of days during which the prisoner was confined in jail awaiting and during trial prior to the imposition of sentence and not under any sentence of confinement.
(Emphasis added.)
Harnum focused upon the phrases "awaiting and during trial" in RSA 651-A:23 and "in custody" in RSA 651:3, I. Harnum, 142 N.H. at 197-98, 697 A.2d 1380. Harnum reasoned that "awaiting trial," by its plain meaning, could not mean awaiting extradition and thus did not encompass the defendant's time awaiting extradition from Florida. Id. at 197, 697 A.2d 1380. Furthermore, Harnum said that a defendant received credit only so long as he was "in custody." Id. at 198, 697 A.2d 1380. The defendant was not in custody "for purposes of New Hampshire law" while under Florida authority because the term custody "necessarily presupposes a form of custody over which New Hampshire can exercise its control." Id. at 198, 697 A.2d 1380. The trial court in this case reached the correct result under our holding in Harnum.
We do not lightly overrule a prior opinion. Alonzi v. Northeast Generation Servs. Co., 156 N.H. 656, 659, 940 A.2d 1153 (2008). "The doctrine of stare decisis demands respect in a society governed by the rule of law, for when governing legal standards are open to revision in every case, deciding cases becomes a mere exercise of judicial will with arbitrary and unpredictable results." Jacobs v. Director, N.H. Div. of Motor Vehicles, 149 N.H. 502, 504, 823 A.2d 752 (2003) (quotation omitted). "Thus, when asked to reconsider a holding, the question is not whether we *704 would decide the issue differently de novo, but whether the ruling has come to be seen so clearly as error that its enforcement was for that very reason doomed." Id. at 504-05, 823 A.2d 752 (quotation omitted). Several factors inform our judgment of whether a decision has come to be seen as such an error, including: (1) whether the rule has proven to be intolerable simply in defying practical workability; (2) whether the rule is subject to a kind of reliance that would lend a special hardship to the consequences of overruling; (3) whether related principles of law have so far developed as to have left the old rule no more than a remnant of abandoned doctrine; and (4) whether facts have so changed, or come to be seen so differently, as to have robbed the old rule of significant application or justification. Id. at 505, 823 A.2d 752 (quotations omitted). These factors guide our judgment, but no single factor is wholly determinative.
The defendant argues that Harnum is inconsistent with the development of the law and is, as a rule, unworkable. He argues that the fact that a majority of jurisdictions allow such credit weighs in favor of our adopting a new rule today. At oral argument, he also argued that Harnum was tailored to its own facts and does not provide sound precedent for future cases. In particular, he argues, Harnum means that defendants awaiting arraignment, probable cause hearings, sentencing hearings or probation hearings would not receive credit for their confinement because they are not "awaiting trial" within the narrow confines of the decision.
The State responds that Harnum is hardly unworkable, as it provides clear guidance to courts as to what time will be credited in distinguishing "awaiting extradition" from "awaiting trial." As for the defendant's arguments concerning awaiting other judicial proceedings, the State argues these are controlled by other statutes and should have no bearing upon our analysis. See RSA 651-A:19 (2007) (concerning credit for parolees).
We agree with the defendant that Harnum should be overruled. We believe there are principles of law the Harnum court did not consider. We also recognize the vast majority of jurisdictions have decided to the contrary and that no party has relied upon our prior holding so as to lend a special hardship to the consequences of overruling.
"[We] are sometimes able to perceive significant facts or understand principles of law that eluded [our] predecessor and justify departures from existing decisions." Planned Parenthood v. Casey, 505 U.S. 833, 866, 112 S. Ct. 2791, 120 L. Ed. 2d 674 (1992). Here, departure from Harnum is justified because the majority opinion failed to give full consideration to the plain language in RSA 651-A:23, which states that a prisoner shall be granted credit for time spent in "the state prison, any house of corrections, any jail or any other place...." (Emphasis added.)
Although both the majority and dissenting opinions quote this language, neither analyzes the text or seems to consider it relevant. Instead, Harnum focused on the language "in custody" in RSA 651:3, I, and "awaiting and during trial" in RSA 651-A:23. In doing so, it construed custody to mean solely New Hampshire custody and awaiting trail to exclude awaiting extradition. By making these definitions the linchpin of its analysis, the court saw no need to discuss the "any jail or any other place" language in RSA 651-A:23. The location of the custody was irrelevant because the determining factor was who controlled the custody and the status of the defendant's case. This analysis, however, does not read RSA 651:3, I, and RSA 651-A:23 as a whole.
*705 If the majority's reading is correct, the legislature's addition of "any jail or any other place" is superfluous language. The legislature, however, is presumed not to use superfluous language. N.H. Ins. Guar. Ass'n v. Pitco Frialator, 142 N.H. 573, 578, 705 A.2d 1190 (1998). Thus, an interpretation that renders statutory language superfluous and irrelevant is not a proper interpretation. By appraising this language as irrelevant, Harnum failed to follow the well-recognized rules of statutory interpretation.
When interpreting statutes, we look to the language of the statute itself, and, if possible, construe that language according to its plain and ordinary meaning. DaimlerChrysler Corp. v. Victoria, 153 N.H. 664, 666, 917 A.2d 209 (2006). We do not pick and choose those portions of the language we find controlling and subvert those we do not; we read the statute as a whole. See id. We will neither consider what the legislature might have said nor add words that it did not see fit to include. Id. Nor will we interpret statutory language in a literal manner when such a reading would lead to an absurd result. Great Traditions Home Builders v. O'Connor, 157 N.H. 387, 388, 949 A.2d 724 (2008).
RSA 651:3, I, states that a defendant who is "in custody" "shall be credited in the manner set forth in RSA 651-A:23." Its plain language thus directs one to RSA 651-A:23 to determine who is eligible to receive confinement credit. RSA 651-A:23, in turn, states that "any prisoner who is confined to ... any jail or any other place shall be granted credit." By reading RSA 651:3, I, in isolation, Harnum construed "in custody" to render irrelevant the "any jail or any other place" language in RSA 651-A:23. The statute, however, makes no distinction between in-state and out-of-state custody, nor does it distinguish between in-state and out-of-state jails. We will not add words that the legislature did not see fit to include, nor delete those that it did.
Had the Harnum court properly perceived the significance of that statutory language, it would have been difficult to reach the result it did. As Justice Powell wrote in his concurring opinion in Monell v. Department of Social Services of City of New York, 436 U.S. 658, 98 S. Ct. 2018, 56 L. Ed. 2d 611 (1978), "we owe somewhat less deference to a decision that was rendered without benefit of a full airing of all the relevant considerations." Monell, 436 U.S. at 709 n. 6, 98 S. Ct. 2018 (Powell, J., concurring).
Furthermore, Harnum's interpretation of "awaiting trial" is the kind of literal interpretation that leads to an absurd result. Instead, we are persuaded by the dissent in Harnum. The dissent stated:
The majority ... [reasons] that granting credit to this defendant would require modification of RSA 651-A:23 by adding the words "while awaiting extradition." The unstated assumption behind this putative dichotomy is the debatable notion that one cannot be "awaiting extradition" while "awaiting trial." Taken to its extreme, the majority's argument would also deny credit to those who are "awaiting indictment," "awaiting arraignment," or "awaiting a competency determination." It is always possible to slice off some preliminary phase of a criminal proceeding and announce that the time was not spent "awaiting trial." This arbitrary application of labels has, however, been eschewed by this court in the past, as we have noted that application of a label does not alter or diminish the event's consequence to the defendant.... Substantive evaluation of the character of the time period in question compels the *706 conclusion that time spent awaiting extradition is time spent under the control of the State prior to trial, and the defendant is therefore entitled to credit.
Harnum, 142 N.H. at 200-01, 697 A.2d 1380 (Broderick, J., dissenting) (quotations and brackets omitted).
The majority's reading of the statute was flawed. Because it is technically only after indictment that a defendant is "awaiting trial," Harnum would presumably not grant credit for time spent in jail between the arrest and indictment. Such a reading of the statute makes little sense. Rather, "awaiting and during trial" encompasses all time from the moment of arrest through the completion of the trial and sentencing. In so holding, we join the overwhelming majority of jurisdictions that have decided this issue.
At least thirty-nine other jurisdictions give credit in similar circumstances. The defendant argues that Harnum's rule should thus be seen as "no more than a remnant of abandoned doctrine." See Jacobs, 149 N.H. at 505, 823 A.2d 752; Nieto v. State, 119 Nev. 229, 70 P.3d 747, 748 n. 7 (2003) (listing the jurisdictions). "[T]he overwhelming majority of states allow for the granting of credit for time served in presentence confinement while awaiting extradition when the sole reason for the foreign incarceration is the offense for which the defendant is ultimately convicted and sentenced." Nieto, 70 P.3d at 748. At least three states have decided the issue since we decided Harnum; all three rejected Harnum. See Nieto, 70 P.3d at 748; State v. Cooper, 26 Kan. App. 2d 557, 990 P.2d 765 (1999); State ex rel. Curry v. Thompson, 156 Or.App. 537, 967 P.2d 522 (1998). Indeed, the Nevada Supreme Court expressly rejected Harnum's reasoning, stating, "the reasoning in Harnum [is] unpersuasive." Nieto, 70 P.3d at 748.
It appears the Harnum court was aware of some level of disagreement over the proper scope of pretrial confinement credit, but the decision does not recognize that it is virtually alone in reaching such a result. The vast support for granting pretrial confinement credit while awaiting extradition is a factor we consider in our decision to overrule Harnum. Compare Matarese v. N.H. Mun. Assoc. Prop.-Liab. Ins. Trust, 147 N.H. 396, 403, 791 A.2d 175 (2002) (taking into consideration that a majority of other jurisdictions have decided an issue in one direction).
Furthermore, in this case, no party can reasonably argue they have structured their conduct in reliance upon defendants not receiving pretrial credit while awaiting extradition. Under the second Jacobs factor, we inquire into "the cost of a rule's repudiation as it would fall on those who have relied reasonably on the rule's continued application." Casey, 505 U.S. at 855, 112 S. Ct. 2791. The classic case falling into this category is one creating a rule within the commercial context, "where advance planning of great precision is most obviously a necessity." Id. at 856, 112 S. Ct. 2791. In this case, therefore, reliance upon a prior rule of law does not weigh against overruling Harnum.
Although stare decisis generally "has more force in statutory analysis than in constitutional adjudication because, in the former situation, [the legislature] can correct our mistakes through legislation," that is not always the case. Monell, 436 U.S. at 695, 98 S. Ct. 2018. We are unwilling to mechanically apply the principles of stare decisis to allow a decision that was wrong when it was decided perpetuate as a rule of law. See id. Neither will we always place on the shoulders of the legislature the burden to correct our own error. See id. As Justice O'Connor wrote in Casey, there are some cases of widespread *707 controversy in which a high court is asked to step in and resolve a question of interpretation. See Casey, 505 U.S. at 866, 112 S. Ct. 2791. Once the court issues a rule of law, it will leave future alterations to the political branches and their active constituents. It is in cases of such political importance that a court must be especially wary of altering course under pressure. The granting of pretrial confinement credit, however, is not such a case. It is neither a socially divisive issue nor one creating a constituency on behalf of which the legislature is likely to act. These circumstances place the burden upon this court to rectify its own error. We therefore overrule Harnum. As the Harnum dissent noted, if the State wishes to punish defendants who flee the jurisdiction, the legislature can enact separate legal provisions. Cf. RSA 642:6, I (2007) ("A person is guilty of an offense if he escapes from official custody.").
In this case, the sole reason the defendant was arrested was the New Hampshire warrant. He should, therefore, receive pretrial confinement credit for time he spent in any jail after his May 3, 2004 arrest in Colombia.
Affirmed in part; reversed in part; and remanded.
BRODERICK, C.J., and DALIANIS and GALWAY, JJ., concurred. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563907/ | 75 F.2d 984 (1935)
In re UNION GUARANTEE & MORTGAGE CO.
UNION GUARANTEE & MORTGAGE CO.
v.
VAN SCHAICK, Superintendent of Insurance.
No. 298.
Circuit Court of Appeals, Second Circuit.
March 11, 1935.
Gifford, Woody, Carter & Hays, of New York City (Raymond M. White, of New York City, of counsel), for appellant.
Harry Rodwin, and Schurman, Wiley & Willcox, all of New York City (Jacob Gould Schurman, Jr., Joseph Lapidus, and Irving H. Jurow, all of New York City, of counsel), for appellee.
Before L. HAND, SWAN, and AUGUSTUS N. HAND, Circuit Judges.
PER CURIAM.
The Union Guaranty & Mortgage Company filed a petition for reorganization under section 77B of the Bankruptcy Act (11 USCA § 207) on July 30, 1934. George S. Van Schaick, superintendent of insurance of the state of New York, appeared on August 10th and filed an answer, and, when the cause came on for trial, the judge dismissed the petition. The petitioner appeals from that decree. Van Schaick had been appointed "rehabilitator" of the debtor on August 2, 1933, in a proceeding in the Supreme Court of the state of New York under an act authorizing the superintendent of insurance to take over the assets of insurance companies for purposes of "rehabilitation" (article 11 [§ 400 et seq.], Insurance Law). The only question is whether the debtor is an insurance company within section 4 of the Bankruptcy Act, 11 USCA § 22 and section 77B, subd. (a), 11 USCA § 207 (a). It was organized under the Insurance Law of the state of New York (Consol. Laws N. Y. c. 28), and its business was to make loans secured by mortgages on real property which it sold to its customers with a guaranty. In some cases it assigned the whole mortgage; in others it kept the legal title and divided its interest into "participation certificates," which it guaranteed; but it never guaranteed the titles of the mortgaged parcels of land. Its income consisted primarily of fees charged the borrowers and of one-half of 1 per cent. of the interest accruing upon the mortgages assigned, which it reserved as a "premium." However, in addition to these, it received fees for extending mortgages as they fell due, and it retained the full interest upon its mortgages before their assignment.
The purpose of Congress in the amendment of 1910 to section 4, 11 USCA § 22, was to make a comprehensive definition with certain exceptions, rather than to enumerate the kinds of companies which were subject to bankruptcy. The purpose of the exception is not self-evident; we must infer it as best we can from such similarity as exists between the excepted groups. All except municipalities are companies for profit whose businesses are now generally regarded as "affected with a public interest"; that is to say, as touching enough persons who must deal with them at some economic disadvantage, to require public supervision and control. And municipalities are even more directly within public control. The most natural inference is that Congress meant to leave to local winding up statutes the liquidation of such companies; that, since the states commonly kept supervision over them during their lives, it was reasonable that they should take charge on their demise. *985 Columbia, etc., Co. v. South Carolina, 27 F. (2d) 52, 59 A. L. R. 665 (C. C. A. 4); In re Grafton G. & E. Co. (D. C.) 253 F. 668. Cf. In re Hudson River Power Co., 183 F. 701, 33 L. R. A. (N. S.) 454 (C. C. A. 2). Now it is the powers conferred upon the company, not its activities, which are decisive. Gamble v. Daniel, 39 F.(2d) 447 (C. C. A. 8); Clemons v. Liberty Savings, etc., Co., 61 F.(2d) 448 (C. C. A. 5). So far as In re Supreme Lodge of Masons Annuity (D. C.) 286 F. 180, holds otherwise it cannot be accepted. If a state enacts that companies having powers of a prescribed kind must be regulated, that is of course authoritative; and, if in addition it classes the company as a bank or a railroad or an insurer, that too should be authoritative. Kansas v. Hayes, 62 F.(2d) 597 (C. C. A. 10); Security B. & L. Ass'n v. Spurlock, 65 F.(2d) 768 (C. C. A. 9). This is true, not because Congress was bound to yield in such cases, but because otherwise its apparent purpose to leave the winding up of such companies to the state would not be effected; for the will of the state is no clearer to supervise the company than to class it as it does. When Congress excepted not all companies affected with a public interest, but specified kinds of such company, presumably it intended the states to define the kinds.
Thus we have no occasion to decide whether the debtor at bar ought not to have been incorporated under the New York Insurance Law and regulated as such, whatever such a statement could mean. Assuming that it should not, it was in fact so subject and so incorporated. The state has chosen to regard it so, and that is all we may ask. We need not therefore consider how far Bowers v. Lawyers' Mortgage Company, 285 U.S. 182, 52 S. Ct. 350, 76 L. Ed. 690, is alike on the facts. The differences are indeed only in degree; but, though they might independently be enough, a complete parallelism would be irrelevant, considering the separate purposes of the two statutes. What Congress meant by an insurance company in the income tax law has nothing to do with its meaning in the Bankruptcy Act. It is true that this makes the meaning of section 4 depend upon local laws and subjects that meaning to change as those laws change; pro tanto, Congress has delegated its power. But this is not the only instance in the Bankruptcy Act; thus exemptions are dependent upon local law, section 6, 11 USCA § 24, and so are the priorities among claims, section 64b (7), as amended, 11 USCA § 104 (b) (7), Hanover National Bank v. Moyses, 186 U.S. 181, 22 S. Ct. 857, 46 L. Ed. 1113; Stellwagen v. Clum, 245 U.S. 605, 38 S. Ct. 215, 62 L. Ed. 507. It is by no means true that Congress may in no circumstances delegate its powers to the states, provided that in the main the resulting system be uniform.
The debtor also argues that, by the stopping of the debtor's business when the superintendent intervened, it ceased to be an insurance company. It would be a curious result if the exercise of the power reserved to the state were to be the means of its extinction while it was still incomplete. The phrase in subdivision (a) of section 77B, 11 USCA § 207 (a), "provided the present operations of such corporation do not exclude it hereunder," is indeed obscure, but it cannot mean that. We agree with the superintendent that, whatever it does mean, it is attached in sense, as it is in position, to the phrase which gives power to a debtor to file a petition in a bankruptcy proceeding already pending. It immediately succeeds the phrase, "whether filed before or after this section becomes effective"; apparently it is a limitation upon that. It may, for example, be intended to exclude a case in which the company was adjudicable as a bankrupt at petition filed, but ceased to be thereafter, perhaps because its principal place of business had changed. We must own that this does not clear away the doubts; but, as we have said, blind as it is, it surely does not mean to impair the generality of the grant of jurisdiction with which the section opens.
Order affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563913/ | 960 A.2d 1071 (2008)
111 Conn.App. 588
TUCCIO DEVELOPMENT, INC.
v.
Harry NEUMANN, Jr.
No. 29147.
Appellate Court of Connecticut.
Argued October 14, 2008.
Decided December 16, 2008.
*1072 John R. Williams, New Haven, for the appellant (plaintiff).
Charles E. Vermette, Jr., with whom, on the brief, was Christopher J. Sochacki, Avon, for the appellee (defendant).
DiPENTIMA, McLACHLAN and DUPONT, Js.
McLACHLAN, J.
The plaintiff, Tuccio Development, Inc., appeals from the summary judgment rendered by the trial court in favor of the defendant, Harry Neumann, Jr. The plaintiff challenges the court's holdings that there was no genuine issue of material fact and that Neumann was entitled to judgment as a matter of law. We affirm the judgment of the trial court.
The plaintiff, a residential real estate development corporation, contracted with Neumann, a licensed Realtor, to market and sell residential properties for the plaintiff from 2000 through 2002. From 2001 until January 6, 2004, the plaintiff was engaged in a legal malpractice action against its former legal counsel.[1] On September 12, 2006, the plaintiff filed a one count complaint against Neumann, alleging violations of General Statutes § 20-325h[2] and the Connecticut Unfair Trade Practices Act (CUTPA), General Statutes § 42-110a et seq. In the complaint, the plaintiff alleged that "[t]hroughout the entire time of the [litigation against Donnelly, McNamara & Gustafson, P.C.], [Neumann] furnished confidential information, such as the plaintiff's motivations to purchase and sell real property and previous offers regarding same, for the purpose of disadvantaging the plaintiff, to the parties opposing the plaintiff in said litigation and/or to their attorneys." The plaintiff alleged that those disclosures, which were in violation of § 20-325h, constituted "unfair and deceptive acts and practices in trade and commerce within the meaning of [CUTPA]."
On June 7, 2007, Neumann filed a motion for summary judgment, alleging that there was no genuine issue of material fact and that he was entitled to summary judgment as a matter of law. Neumann submitted two supporting affidavits with his motion: (1) his affidavit swearing that during the prior malpractice litigation, he did not provide any documents or information to the parties opposing the plaintiff[3] and (2) an affidavit by the opposing parties' *1073 attorney, Stephen P. Fogerty, affirming that he received discovery from the plaintiff but no documents or information from Neumann.[4]
On July 5, 2007, the plaintiff filed a memorandum of law in opposition to the motion for summary judgment. The plaintiff asserted that "[u]nquestionably, during both the pretrial phase and the trial phase of Tuccio Development, Inc. v. Donnelly, McNamara & Gustafson, P.C. defense counsel had and used against the plaintiff documents which the plaintiff had sent to Mr. Neumann."[5] The plaintiff argued that because Edward Tuccio, an owner and officer of the plaintiff, had not produced the documents to the defendants' counsel in the prior litigation, there existed a genuine issue of material fact as to the source of those documents and that "[f]or present purposes, the issue [was] whether the evidence is such that a jury could conclude that the source was ... Neumann." The plaintiff also argued that Edward Tuccio's affidavit,[6] along with the exhibits[7] and *1074 Neumann's admissions, provided sufficient evidence for a jury to conclude that "[Neumann] was the source of the documents from his file, which were possessed and used by the plaintiff's opponent[s] in [Tuccio Development, Inc. v. Donnelly, McNamara & Gustafson, P.C.]."
Following oral argument,[8] the court conducted a thorough review of the evidence and concluded that the plaintiff's argument was "mere conjecture and [was] not supported by any evidence or materials offered by the plaintiff." The court also found that "the plaintiff has not submitted any evidence to contradict or rebut that offered by [Neumann], and, therefore, there exists no genuine issue as to any material fact. Accordingly, ... Neumann is entitled to judgment as a matter of law, and the motion for summary judgment is granted."
The plaintiff claims that the court improperly held that there was no genuine issue of material fact and that Neumann was entitled to judgment as a matter of law. We disagree.
"Because the court's decision on a motion for summary judgment is a legal determination, our review on appeal is plenary.... The law governing summary judgment and the accompanying standard of review are well settled. Practice Book § [17-49] requires that judgment shall be rendered forthwith if the pleadings, affidavits and any other proof submitted show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. A material fact is a fact that will make a difference in the result of the case.... The facts at issue are those alleged in the pleadings....
"In seeking summary judgment, it is the movant who has the burden of showing the nonexistence of any issue of fact. The courts are in entire agreement that the moving party for summary judgment has the burden of showing the absence of any genuine issue as to all the material facts, which, under applicable principles of substantive law, entitle him to a judgment as a matter of law. The courts hold the movant to a strict standard. To satisfy his burden the movant must make a showing that it is quite clear what the truth is, and that excludes any real doubt as to the existence of any genuine issue of material fact.... As the burden of proof is on the movant, the evidence must be viewed in the light most favorable to the opponent....
"It is frequently stated in Connecticut's case law that, pursuant to Practice Book §§ 17-45 and 17-46, a party opposing a summary judgment motion must provide an evidentiary foundation to demonstrate the existence of a genuine issue of material fact.... [T]ypically [d]emonstrating a genuine issue requires a showing of evidentiary facts or substantial evidence outside the pleadings from which material facts alleged in the pleadings can be warrantably inferred.... Moreover, [t]o establish the existence of a material fact, it is not enough for the party opposing summary judgment merely to assert the existence of a disputed issue.... Such assertions are insufficient regardless of whether they are contained in a complaint or a brief.... *1075 Further, unadmitted allegations in the pleadings do not constitute proof of the existence of a genuine issue as to any material fact." (Citation omitted; internal quotation marks omitted.) DaGraca v. Kowalsky Bros., Inc., 100 Conn.App. 781, 785-86, 919 A.2d 525, cert. denied, 283 Conn. 904, 927 A.2d 917 (2007).
"Although the court must view the inferences to be drawn from the facts in the light most favorable to the party opposing the motion ... a party may not rely on mere speculation or conjecture as to the true nature of the facts to overcome a motion for summary judgment.... A party opposing a motion for summary judgment must substantiate its adverse claim by showing that there is a genuine issue of material fact together with the evidence disclosing the existence of such an issue." (Internal quotation marks omitted.) Id., at 792, 919 A.2d 525.
The plaintiff claims that the court improperly held that there was no genuine issue of material fact. The plaintiff claims that the court "ruled in effect that without `smoking gun' evidence that [Neumann] was the source of the purloined documents, the plaintiff could not prevail." The plaintiff claims that "the evidence submitted to the court, which had to be credited, proved that there were only two possible sources of the documentsthe plaintiff and [Neumann]and that the plaintiff was not the source."[9] The plaintiff misstates the evidence it produced for the court.
Neumann provided the court with competent evidence that he did not produce any confidential documents or information to the plaintiff's opposing parties or to their attorney in the prior litigation. Neumann produced both his sworn affidavit attesting to that fact and the sworn affidavit of the opposing parties' attorney. The plaintiff, however, produced only deposition testimony showing that a letter Edward Tuccio wrote to Neumann was used in the prior litigation and Edward Tuccio's statement in his affidavit that he "personally reviewed [the plaintiff's] discovery response... and [n]o communications from me or my company to Harry Neumann, Jr., or his company were included in such response." Thus, in response to Neumann's evidence that he had turned over no confidential communications, the plaintiff's evidence, viewed in the light most favorable to the plaintiff, showed only that (1) the opposing parties had received the communication and (2) the plaintiff had not included the communication in its discovery response to the opposing parties. Despite the plaintiff's argument to the contrary, it supplied absolutely no evidence that the plaintiff and Neumann were the only possible sources of the documents. The plaintiff supplied no evidence that Edward Tuccio did not supply a third party with copies of the documents. Moreover, the plaintiff did not even submit the documents it alleged were turned over by Neumann. Thus, the plaintiff failed to supply sufficient circumstantial evidence that would make the inference that Neumann turned over the documents anything more than speculation. We must therefore conclude that the plaintiff provided the court with nothing more than "mere speculation or conjecture" and did nothing to refute the facts stated in the defendant's affidavits. See Larobina v. McDonald, 274 Conn. 394, 399-400, 876 A.2d 522 (2005). The court correctly determined that there was no genuine issue as to any *1076 material fact and that Neumann was entitled to judgment as a matter of law.
The judgment is affirmed.
In this opinion the other judges concurred.
NOTES
[1] Tuccio Development, Inc. v. Donnelly, McNamara & Gustafson, P.C., Superior Court, judicial district of Danbury, Docket No. CV-01-0343253-S, resulted in a judgment in favor of the plaintiff. The legal malpractice action related to the plaintiff's business and properties for which Neumann was the plaintiff's Realtor.
[2] General Statutes § 20-325h provides in relevant part: "(a) No real estate licensee shall: (1) Reveal confidential information concerning a person whom the real estate licensee represented either as an agent, designated buyer agent or a designated seller agent ... or (3) use confidential information concerning that person for the ... advantage of a third party, except as required by legal process, as necessary to defend the real estate broker or real estate salesperson from allegations of wrongful or negligent conduct, or as necessary to prevent the commission of a crime.
"(b) As used in this section, `confidential information' means facts concerning a person's assets, liabilities, income, expenses, motivations to purchase, rent or sell real property and previous offers received or made to purchase or lease real property which are not authorized by the client, a matter of general knowledge, part of a public record or file to which access is authorized pursuant to section 1-210 or otherwise subject to disclosure under any other provision of the general statutes or any regulation of Connecticut state agencies."
[3] Neumann's affidavit states:
"1. I am over eighteen years of age and believe in the obligation of an oath.
"2. I am a licensed [R]ealtor in the State of Connecticut.
"3. During the years 2000, 2001 and 2002, I contracted with [the plaintiff] to market and sell residential properties in the Town of Ridgefield, Connecticut.
"4. At no time during the pendency of the civil litigation referenced in the plaintiff's Complaint ... did I have any contact with the parties opposing the plaintiff in said litigation and/or their attorneys.
"5. At no time during the pendency of the Litigation did I provide any documents or information to the parties opposing the plaintiff in said litigation and/or to their attorneys."
[4] Fogerty's affidavit states:
"1. I am over eighteen years of age and believe in the obligation of an oath.
"2. I am an attorney licensed to practice in the State of Connecticut, and I am a partner at Halloran & Sage, LLP.
"3. I represented Donnelly, McNamara & Gustafson, P.C., Paul McNamara and Rex Gustafson in a lawsuit filed by [the plaintiff], hereinafter the `Litigation'.
"4. On January 9, 2002, I filed Interrogatories and Requests for Production upon [the plaintiff].
"5. On May 23, 2002, [the plaintiff] filed compliance with the Interrogatories and Requests for Production consisting of 900 pages. Each page was stamped beginning with 00001-00900 in the exact order as produced by [the plaintiff].
"6. At no time during the pendency of the Litigation did I have any contact with Harry Neumann, Jr.
"7. At no time during the pendency of the Litigation did I receive any documents or information from Harry Neumann, Jr., or his office."
[5] The plaintiff identified exhibits one and two attached to its memorandum of law as support for this proposition. Exhibit one is an excerpt of Edward Tuccio's September 10, 2002 deposition testimony, and exhibit two is an excerpt from the December 9, 2003 testimony of Edward Tuccio; both include examination of the plaintiff regarding an October 20, 2000 letter sent by Edward Tuccio to the defendant. Although the plaintiff did not submit certified copies of the testimony, the defendant did not object to its admissibility, and the court, in its discretion, chose to review the testimony. See Schilberg Integrated Metals Corp. v. Continental Casualty Co., 263 Conn. 245, 273, 819 A.2d 773 (2003).
[6] Edward Tuccio's affidavit, which was attached to the memorandum of law, states:
"1. I am an owner and officer of Tuccio Development, Inc., the plaintiff in this lawsuit. I have personal knowledge of all the facts relevant to this matter.
"2. I was personally involved in all aspects of Tuccio Development, Inc. v. Donnelly, McNamara & Gustafson, P.C. .... a civil suit tried to verdict in this court.
"3. Exhibit 1 is a true and accurate copy of pages taken from the transcript of my deposition in the aforesaid lawsuit on September 10, 2002.
"4. I personally attended every day of the trial of that case and testified at such trial. Exhibit 2 is a true and accurate copy of portions of my testimony at that trial.
"5. I personally reviewed our discovery response, Exhibit 3. No communications from me or my company to Harry Neumann, Jr., or his company were included in such response."
[7] The plaintiff attached, as the third exhibit to its memorandum of law, its responses to the interrogatories and requests for production. The responses, however, repeatedly refer to attached documents that were not submitted to the trial court as exhibits in this case.
[8] The plaintiff has not provided this court with a transcript of the oral argument held before the court on July 9, 2007.
[9] The plaintiff makes much of its argument that "[c]ircumstantial evidence is in no way inferior to direct evidence." We do not challenge this principle but find no support for the plaintiff's argument that it proved its case with circumstantial evidence. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563902/ | 16 So. 3d 322 (2009)
John JAMES a/k/a Ingemar Keitt, Appellant,
v.
STATE of Florida, Appellee.
No. 4D07-4730.
District Court of Appeal of Florida, Fourth District.
September 16, 2009.
*323 Carey Haughwout, Public Defender, and Anthony Calvello, Assistant Public Defender, West Palm Beach, for appellant.
Bill McCollum, Attorney General, Tallahassee, and Sue-Ellen Kenny, Assistant Attorney General, West Palm Beach, for appellee.
DAMOORGIAN, J.
Ingemar Keitt (a/k/a John James) was charged with seven crimes arising out of events that took place on March 8, 2007. He appeals his convictions for two of those crimes, carrying a concealed weapon by a convicted felon and battery on a law enforcement officer. We affirm his conviction for battery on a law enforcement officer without discussion. We reverse his conviction for carrying a concealed weapon by a convicted felon and remand for a new trial on that charge.
At trial, Officer Paul Brown testified that he was dispatched to a supermarket in reference to a shoplifting incident on March 8, 2007. He spoke to the store manager, who directed him to a blue mini-van parked in front of the store. He then observed a man, whom he identified as Keitt, exit from the mini-van and walk toward a coffee shop. When he looked inside the van, he observed several cases of beer. At that point, he called out to Keitt, who walked over to him. He informed Keitt that he wanted to speak with him and pat him down for safety purposes. Keitt agreed. As Keitt turned around for the pat-down, however, he fled on foot. Officer Brown ordered him to stop, but he continued to flee and a chase commenced. During the chase, Keitt fell down and was apprehended. Keitt resisted Officer Brown's attempt to handcuff him. Officer Brown ordered him to stop resisting, but he pushed the officer to the ground and fled once again. Sometime during the struggle, Keitt's jacket came off. Another chase ensued, during which Keitt reached *324 a metal fence. When he attempted to climb the fence, Officer Brown noticed an open silver knife on Keitt's waistband. Keitt was unable to scale the fence and surrendered to Officer Brown.
Next, Officer Brown testified that he searched Keitt and his jacket incident to arrest for battery on a law enforcement officer. The search revealed a crack cocaine pipe, a set of car keys, some cold cuts, and the silver knife. Officer Brown later determined that the keys belonged to the blue mini-van in front of the supermarket, and it was later discovered that the van had been reported stolen.
At the conclusion of the State's case, Keitt moved for judgments of acquittal on all seven charges. The trial court granted the motion as to a felony petty theft charge, but denied it as to all other charges, including carrying a concealed weapon by a convicted felon.
Following the presentation of evidence, the trial court instructed the jury on the charge of carrying a concealed weapon by a convicted felon as follows:
Ingemar Keitt, the defendant in this case, has been accused, in Count 1 of the information of the crime of possession of a concealed weapon by a convicted felon.
. . . .
To prove the crime of possession of concealed weapon by a convicted felon, the State must prove the following three elements beyond a reasonable doubt: Ingemar Keitt had been convicted of grand theft auto, a felony; after the conviction, Ingemar Keitt knowingly carried a concealed weapon.
Convicted means that a judgment has been entered in a criminal proceeding by a Court pronouncing the accused guilty.
Care and custody mean immediate charge and control exercised by a person over the named object. The terms care, custody and control may be used interchangeably.
To possess means to have personal charge of or exercise the right of ownership, management or control over an object.
Possession may be actual or constructive. Actual possession means the object is in the hand of or on the person or the object is in a container in the hand of or on the person or the object is so close as to be within ready reach and is under the control of the person. Mere proximity to an object is not sufficient to establish control over the object when the object is not in a place over which the person has control.
Constructive possession means the object is in a place over which Ingemar Keitt has control or in which Ingemar Keitt has concealed it. If an object is in a place over which Ingemar Keitt does not have control, the State establishes constructive possession if it proves that Ingemar Keitt has knowledge that the object was within Ingemar Keitt's presence and has control over the object.
Possession may be joint, that is two or more persons may jointly possess an object exercising control over it. In that case, each of those persons is considered to be in possession of that object.
If a person has exclusive possession of an object, knowledge of its presence may be inferred or assumed. If a person does not have exclusive possession of an object, knowledge of its presence may not be inferred or assumed.
The verdict form on that charge read as follows:
WE, THE JURY, find as follows as to the Defendant in this case: (Check only one)
____ A. The Defendant is Guilty of Possession of a Concealed Weapon by *325 a Convicted Felon, as charged in the Information.
___ B. The Defendant is Not Guilty.
(emphasis added). The jury found Keitt guilty of the six remaining charges.
Keitt argues that the trial court committed fundamental error by failing to define crucial elements of the crime of "carrying a concealed weapon by a convicted felon" for the jury and by instructing the jury on the non-existent crime of "possession of a concealed weapon by a convicted felon" instead of the crime with which he was charged.
It is the responsibility of the trial court in a criminal case to ensure that the jury is fully and correctly instructed about the applicable law. Battle v. State, 911 So. 2d 85, 88-89 (Fla.2005). Nevertheless, Keitt failed to object to these omissions and mis-instructions at trial, so this issue is cognizable on appeal only if the trial court committed fundamental error. See State v. Delva, 575 So. 2d 643, 644 (Fla. 1991). This court has explained fundamental error in the context of jury instructions as follows:
To constitute fundamental error, an erroneous jury instruction "`must reach down into the validity of the trial itself to the extent that a verdict of guilty could not have been obtained without the assistance of the alleged error.'" State v. Delva, 575 So. 2d 643, 644-45 (Fla.1991) (quoting Brown v. State, 124 So. 2d 481, 484 (Fla.1960)). This means that an erroneous jury instruction is fundamental error "`when the omission is pertinent or material to what the jury must consider in order to convict.'" Id. at 645 (quoting Stewart v. State, 420 So. 2d 862, 863 (Fla.1982)); accord Reed v. State, 837 So. 2d 366, 369-70 (Fla. 2002). Thus, "[f]ailing to instruct on an element of the crime over which the record reflects there was no dispute is not fundamental error and there must be an objection to preserve the issue for appeal." Delva, 575 So.2d at 645.
Allen v. State, 939 So. 2d 273, 276 (Fla. 4th DCA 2006). The potentially erroneous jury instruction must be examined in the context of the other jury instructions, the attorneys' arguments, and the evidence in the case. Abbott v. State, 958 So. 2d 1140, 1142 (Fla. 4th DCA 2007).
Keitt's first argument is that the trial court erred in failing to instruct the jury on the definitions of "weapon," "concealed weapon," and "deadly weapon." This error, if such existed, was not fundamental because the record reflects that there was no dispute over whether the knife was a "concealed weapon," as that term is defined by statute. See Delva, 575 So.2d at 645. Thus, we decline to review this issue.
Keitt's second argument is that the trial court committed fundamental error by instructing the jury on the non-existent crime of "possession of a concealed weapon by a convicted felon" instead of "carrying a concealed weapon by a convicted felon," and by defining "possession," "actual possession" and "constructive possession" for the jury. We hold that this was fundamental error.
We begin by noting that the trial court properly instructed the jury on the elements of the charged crime, "carrying a concealed weapon by a convicted felon." The trial court's errors began when it instructed the jury that Keitt was charged with "possession of a concealed weapon by a convicted felon,"[1] and then consistently *326 labeled the crime that way throughout the instructions, on the verdict form, and on the adjudication form.
Section 790.23(1), Florida Statutes (2007), encompasses two separate crimes. The first is possession of a firearm, ammunition, or electric weapon or device by a convicted felon. Id. The second is carrying a concealed weapon, including a tear gas gun or chemical weapon, by a convicted felon. Id. Keitt was charged with the second crime, carrying a concealed weapon by a convicted felon. Thus, his conviction and adjudication for the crime of "possession of a concealed weapon by a convicted felon," a crime with which he was not charged and which does not exist, was fundamental error. See Castillo v. State, 929 So. 2d 1180, 1181 (Fla. 4th DCA 2006) (due process is violated when an individual is convicted of a crime not charged in the charging instrument); Achin v. State, 436 So. 2d 30, 31 (Fla.1982) ("[N]o one may be convicted of a nonexistent crime.").
That error was compounded when the trial court gave the jury the definitions for actual and constructive possession, where those definitions were irrelevant to the charged crime and were likely confusing and misleading to the jury. The Standard Jury Instruction for crimes under section 790.23(1), Florida Statutes (2007), directs a trial judge to instruct a jury on the definitions of actual and constructive possession only if the defendant is charged with possession of a firearm, electric weapon or device, or ammunition. Fla. Std. Jury Instr. (Crim.) 10.15. Those definitions are not supposed to be given if the defendant is charged with carrying a concealed weapon because the definition of "possession" is different from and broader than the definition of "carrying."[2]
Whether Keitt was carrying the knife was disputed at trial, and appears to have been Keitt's only defense to this charge. His attorney argued that the State had not produced evidence that Keitt's fingerprints were on the knife, and that it was not possible for someone to be running and climbing fences with an open knife in his waistband without cutting himself. She went on to suggest that the knife was found somewhere other than on Keitt's person, such as in the stolen car to which Keitt had the keys. Finally, she questioned Officer Brown's credibility, and reminded the jury that he was the only witness to testify about these events.
Under these circumstances, it is impossible to tell whether the jurors were able to discern that the definitions for "actual possession" and "constructive possession" were irrelevant to charge of "carrying a concealed weapon by a convicted felon," especially where the trial court consistently mis-labeled the crime "possession of a concealed weapon by a convicted felon" in the jury instructions and on the verdict form. It is entirely possible that the jurors *327 believed that the definitions for "carrying" and for "possession" were one and the same. Thus, they might have believed that they were required to find Keitt guilty of the crime even if the knife was found in the stolen car, and not on his person. It is this possibility that leads us to the conclusion that the trial court committed fundamental error and that Keitt's conviction for the non-existent crime of "possession of a concealed weapon by a convicted felon" must be reversed and remanded for a new trial. See Mosely v. State, 682 So. 2d 605, 607 (Fla. 1st DCA 1996) ("When jurors are given an instruction that would permit them to find the defendant guilty of a crime that does not exist, the error is fundamental and is per se reversible, and the case must be remanded for retrial.").
This is not a case where the trial court gave the jury a superfluous instruction on an element which never became an issue at trial, either through evidence or argument. Compare State v. Weaver, 957 So. 2d 586 (Fla.2007) (where the Florida Supreme Court held that the trial court's instruction on an alternative theory was not fundamental error because that alternative theory was never at issue in the case) with Sanders v. State, 959 So. 2d 1232 (Fla. 2d DCA 2007) (fundamental error where the jury was improperly instructed on an uncharged alternative theory because the State presented evidence and argument, and the defense presented argument, on the uncharged theory). Whether Keitt carried the knife was at issue during the trial.
Accordingly, we reverse Keitt's conviction and sentence for "possession of a concealed weapon by a convicted felon" and remand for a new trial on the charged crime of carrying a concealed weapon by a convicted felon. We affirm his conviction and sentence for battery on a law enforcement officer.
Affirmed in Part, Reversed in Part, and Remanded.
POLEN and STEVENSON, JJ., concur.
NOTES
[1] Standard Jury Instruction 10.15 labels all crimes under section 790.23, Florida Statutes, as "Felon in Possession of a Weapon." This label is not consistent with the definitions of the crimes that the legislature has set out in section 790.23, Florida Statutes. Thus, we recommend that the standard jury instruction be amended to reflect the language in the statute.
[2] "Carrying" is not defined in either the statute or the standard jury instruction. Nevertheless, the definition of "carrying," which implies that the weapon is on or about the defendant's person, is undeniably narrower than the definition of "possessing," which includes both actively possessing and constructively possessing. See § 790.001(3)(a), Fla. Stat. (2007) (defining "concealed weapon" as any of a list of weapons which is "carried on or about a person in such a manner as to conceal the weapon from the ordinary sight of another person"); § 790.053, Fla. Stat. (2007) ("Except as otherwise provided by law and in subsection (2), it is unlawful for any person to openly carry on or about his or her person any firearm or electric weapon or device."). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1637880/ | 982 So. 2d 683 (2008)
Vincent ROEBUCK, Petitioner,
v.
STATE of Florida, Respondent.
No. SC07-807.
Supreme Court of Florida.
May 15, 2008.
Michael Ufferman of Michael Ufferman Law Firm, P.A., Tallahassee, FL, for Petitioner.
Bill McCollum, Attorney General, Trisha Meggs Pate, Assistant Attorney General, Bureau Chief, and Giselle Lylen Rivera, Assistant Attorney General, Tallahassee, FL, for Respondent.
PER CURIAM.
We initially accepted jurisdiction to review Roebuck v. State, 953 So. 2d 40 (Fla. 1st DCA 2007), a decision in which the First District Court of Appeal certified conflict with the Second District Court of Appeal's decisions in Jaggers v. State, 536 So. 2d 321 (Fla. 2d DCA 1988), and Cliburn v. State, 710 So. 2d 669 (Fla. 2d DCA 1998). Upon further consideration, we have now determined that Roebuck is not in conflict with Jaggers and Cliburn and that jurisdiction should be discharged. Accordingly, this review proceeding is dismissed.
It is so ordered.
LEWIS, C.J., and WELLS, ANSTEAD, PARIENTE, QUINCE, CANTERO, and BELL, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4515684/ | NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAR 12 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
ISIDRO REVUELTA REVUELTA, No. 17-72258
Petitioner, Agency No. A077-419-449
v.
MEMORANDUM*
WILLIAM P. BARR, Attorney General,
Respondent.
On Petition for Review of an Order of the
Board of Immigration Appeals
Submitted March 4, 2020**
San Francisco, California
Before: SILER,*** WARDLAW, and M. SMITH, Circuit Judges.
Isidro Revuelta Revuelta (“Revuelta”) petitions for review of an order of the
Board of Immigration Appeals (“BIA”) and moves for remand to the Executive
Office of Immigration Review (“EOIR”). We have jurisdiction pursuant to 8 U.S.C.
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Eugene E. Siler, United States Circuit Judge for the
U.S. Court of Appeals for the Sixth Circuit, sitting by designation.
§ 1252. We deny the petition for review because the Immigration Judge’s (“IJ”) and
BIA’s decisions denying asylum and withholding of removal are supported by
substantial evidence. See Lopez-Cardona v. Holder, 662 F.3d 1110, 1111 (9th Cir.
2011) (explaining the standard of review). We also deny the motion to remand based
on Pereira v. Sessions because Revuelta’s argument is foreclosed by Ninth Circuit
precedent.
Revuelta claims that he is entitled to asylum because he has demonstrated that
he cannot return to Mexico “because of persecution or a well-founded fear of
persecution on account of . . . membership in particular [] social group[s].” See 8
U.S.C. §§ 1101(a)(42)(A), 1158(b)(1)(A).
To establish past persecution, Revuelta must show “(1) an incident, or
incidents, that rise to the level of persecution; (2) that is on account of one of the
statutorily-protected grounds; and (3) is committed by the government or forces the
government is either unable or unwilling to control.” Navas v. INS, 217 F.3d 646,
655-56 (9th Cir. 2000).
Here, the IJ’s and BIA’s decisions concluding that Revuelta failed to show
past persecution on account of one of the statutorily-protected grounds are supported
by substantial evidence.
In 2013, while in Michoacán, Mexico to repair and sell two properties he
owned, Revuelta claims that he was abducted by four or five armed men, members
2 17-72258
of a cartel called the Knights Templar. He testified that these men took him to a
warehouse where there were many people. The armed men instructed him to sign a
form that he understood was to assign rights to one of his properties to the cartel.
While at the warehouse, Revuelta witnessed another man being beaten but was not
physically harmed himself and left on foot.
Subsequently, Revuelta received a telephone call instructing him to go to a
car wash. He complied and testified that he met two unknown men at the car wash.
During this incident, Revuelta overheard a telephone conversation between one of
the unknown men and his “commander.” Revuelta testified that he heard the
commander clearly instruct the man at the car wash to kill Revuelta. Even so,
Revuelta left unharmed. Finally, in his declaration, Revuelta stated that the Knights
Templar called him and threatened to kill him if he did not give them 35% of the
proceeds from the sale of his second property.
The IJ and BIA correctly concluded that this conduct did not constitute
persecution. These two incidents are not the type of offensive conduct that qualifies
as persecution. There is no credible evidence that Revuelta was physically harmed
as a result of either incident. Additionally, there is no evidence that the unknown
men who met Revuelta at the car wash were associated with the armed men who
abducted and extorted Revuelta.
3 17-72258
Of course, threats and economic persecution may constitute persecution even
if an applicant has not been physically harmed. See Baballah v. Ashcroft, 367 F.3d
1067, 1072-74 (9th Cir. 2004). Still, there is no evidence in this case, unlike the
situation in Baballah, that demonstrates relentless harassment or attacks that would
support a finding of past persecution.
Moreover, Revuelta’s argument that the IJ and BIA failed to give the proper
weight to the events of his childhood is unavailing. The IJ specifically considered
the deaths of Revuelta’s brothers. And evidence of Revuelta’s difficult childhood is
well-established in the record. In any event, Revuelta’s return trips to Mexico
undermine any claimed past persecution occurring before 2012. See Loho v.
Mukasey, 531 F.3d 1016, 1017-18 (9th Cir. 2008).
The IJ and BIA also properly held that Revuelta failed to demonstrate that he
was persecuted “on account of” or “because of” his membership in particular social
groups. 8 U.S.C. § 1101(a)(42)(A); INS v. Elias-Zacarias, 502 U.S. 478, 482-83
(1992); Parussimova v. Mukasey, 555 F.3d 734, 739-42 (9th Cir. 2009).
First, there is no evidence that Revuelta’s brothers were killed based on family
membership. While tragic, the evidence suggests that these events were unrelated
to each other and to family membership. Second, there is an insufficient nexus
between Revuelta’s status as a property owner who defied extortion and the harm he
suffered in 2013.
4 17-72258
Revuelta also failed to establish an objectively reasonable fear of future
persecution. Cf. Kaiser v. Ashcroft, 390 F.3d 653, 658 (9th Cir. 2004). The IJ and
BIA recognized the pervasiveness of violence in Michoacán. Even so, the BIA
correctly noted that Revuelta “did not establish that his fear of gangs differs from
the general threat of criminal harm affecting the entire country.” See Zetino v.
Holder, 622 F.3d 1007, 1016 (9th Cir. 2010).
Additionally, the IJ conducted a proper individualized analysis and
determined that Revuelta could reasonably and safely relocate to another region in
Mexico. See Singh v. Whitaker, 914 F.3d 654, 659-61 (9th Cir. 2019).
Revuelta failed to establish entitlement to humanitarian asylum because he
has neither demonstrated that he suffered past persecution nor established a
reasonable possibility that he may suffer other serious harm upon removal to
Mexico. See 8 C.F.R. § 1208.13(b)(1)(iii)(A)-(B); see also Hanna v. Keisler, 506
F.3d 933, 939 (9th Cir. 2007).
The BIA did not err in finding that Revuelta’s withholding of removal claim
falls with his asylum claim. 8 C.F.R. § 1208.16(b)(2); see also Ghaly v. INS, 58
F.3d 1425, 1429 (9th Cir. 1995).
Lastly, we do not reach the merits of Revuelta’s challenge to denial of
Convention Against Torture (“CAT”) protection because he failed to exhaust the
5 17-72258
claim by not raising it in his brief to the BIA. See Barron v. Ashcroft, 358 F.3d 674,
678 (9th Cir. 2004).
In sum, the record demonstrates that Revuelta had a difficult childhood, was
faced with family tragedies, and fell victim to indiscriminate criminal conduct in a
particularly dangerous area of Mexico. This evidence does not compel a finding
contrary to the decisions of the IJ and BIA denying asylum. Accordingly, the
petition for review is denied.
Revuelta has also moved to remand to the EOIR based on Pereira v. Sessions,
138 S. Ct. 2105 (2018)—arguing that the IJ lacked jurisdiction because the initial
notice to appear lacked the date, time, and location of his hearing. But this court has
considered and rejected an identical argument on the merits. Karingithi v. Whitaker,
913 F.3d 1158, 1159-62 (9th Cir. 2019). As a result, the motion to remand is denied.
The petition for review and motion to remand are DENIED.
6 17-72258 | 01-03-2023 | 03-12-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1563849/ | 960 A.2d 649 (2008)
183 Md. App. 122
Alphonso GARNER
v.
STATE of Maryland.
No. 0818, September Term, 2007.
Court of Special Appeals of Maryland.
December 1, 2008.
*650 Piedad Gomez (Nancy S. Forster, Public Defender on the brief), Baltimore, for appellant.
Gary E. O'Connor (Douglas F. Gansler, Attorney General on the brief), Baltimore, for appellee.
Argued before HOLLANDER, CHARLES E. MOYLAN, JR., (retired, specially assigned) and RAYMOND G. THIEME, JR., (retired, specially assigned), JJ.
MOYLAN, J.
On December 8, 2005, a fragmented Court of Appeals significantly expanded the coverage of the Rule Against Hearsay in Maryland with its opinions in Stoddard v. State, 389 Md. 681, 887 A.2d 564, and Bernadyn v. State, 390 Md. 1, 887 A.2d 602. Several categories of verbal conduct that had theretofore been considered non-hearsay were brought within the expanded definition of "implied assertions" and, thereby, came under the potential exclusionary ban of the Rule Against Hearsay. The present case poses the question of whether yet another traditional category of non-hearsay, frequently referred to as "verbal parts of acts" and represented in this case by incoming telephone calls to gambling parlors or to sellers of narcotics, will also be swept away by the strong undertow of Stoddard and Bernadyn, or whether the expansionist tide that produced those opinions is actually on the ebb.
The Present Case
The appellant, Alphonso Garner, was convicted by a Queen Anne's County jury, presided over by Judge John W. Sause, Jr., of the possession of cocaine with the intent to distribute, of driving on a revoked license, and of other related offenses that were merged for sentencing. On this appeal, the appellant raises the three contentions
1. that Judge Sause erroneously failed to comply with Maryland Rule 4-215 before allowing the appellant to waive his right to counsel,
2. that Judge Sause erroneously admitted inadmissible hearsay evidence, and
3. that Judge Sause's improper comment deprived the appellant of his right to a fair trial.
Factual Background
The appellant does not challenge the legal sufficiency of the State's evidence to prove his guilt generally. The only small residuum of controversy was his effort to convince the jury that he was only a user of drugs and not a pusher.
At 3:45 in the afternoon on June 22, 2006, Trooper Jeremy Gussoni of the Maryland State Police and Scott Myers, a State Police Academy candidate, stopped the appellant, who was driving on U.S. Route 301 in Queen Anne's County, for no less than three minor traffic infractions. As they approached the appellant's *651 stopped car, they heard him yell into a cell phone that he had been "profiled." The appellant immediately handed Trooper Gussoni an identification card and volunteered that his driver's license had been suspended. Trooper Gussoni verified the fact that the driver's license had been revoked. Trooper William Heath arrived on the scene and arrested the appellant for driving on a revoked license. A search incident to the appellant's arrest revealed 13 individually wrapped baggies containing what turned out to be cocaine "secreted in the vehicle's glove box, inside a fuse box." The aggregate weight of the cocaine was 6.9 grams.
On the way to the police station, the appellant asked, "What's going to happen next?" Trooper Gussoni replied that the baggies were going to be fingerprinted. The appellant then said, "You don't have to do that. That shit is mine." When Trooper Gussoni said, "I hope you don't use cocaine; that ... ruins your heart, your brain," the appellant replied, "I don't do that stupid stuff, I only do it every now and again." Taken from the appellant at the police station was his cell phone.
At trial, the appellant called his girlfriend as a witness. She testified that the appellant had a cocaine problem and that she had sometimes seen him "eating" cocaine. Corporal Aaron Michael testified as an expert witness and testified that he had never heard of anyone eating cocaine. He further testified that each of the 13 rocks of cocaine seized from the appellant had a street value of between $40 and $60. Trooper Gussoni had testified that when the appellant's cell phone rang at the station house, Gussoni answered it and said, "Hello." The caller asked, "Can I get a 40?" but then hung up when Gussoni asked him for his name. Trooper Michael explained that the term "40" is a "common reference" for four-tenths of a gram of crack cocaine. It was Trooper Michael's expert opinion that the 13 baggies of cocaine taken from the appellant were intended for sale.
The Minefield of Rule 4-215
Before we can take up the evidentiary matter that is the marquee issue of this appeal, we must get across an ugly patch of difficult terrain. For a judge to traverse Rule 4-215 is to walk through a minefield. A miracle might bring one across unscathed. For mere mortals, the course will seldom be survived. The appellant's first contention is that Judge Sause failed to comply with the provisions of Rule 4-215(e) when he "allowed [the appellant] to waive his right to counsel" immediately before the trial began. Rule 4-215(e) provides:
(e) Discharge of CounselWaiver. If a defendant requests permission to discharge an attorney whose appearance has been entered, the court shall permit the defendant to explain the reasons for the request. If the court finds that there is a meritorious reason for the defendant's request, the court shall permit the discharge of counsel; continue the action if necessary; and advise the defendant that if new counsel does not enter an appearance by the next scheduled trial date, the action will proceed to trial with the defendant unrepresented by counsel. If the court finds no meritorious reason for the defendant's request, the court may not permit the discharge of counsel without first informing the defendant that the trial will proceed as scheduled with the defendant unrepresented by counsel if the defendant discharges counsel and does not have new counsel. If the court permits the defendant to discharge counsel, it shall comply with subsections (a)(1)-(4) of this *652 Rule if the docket or file does not reflect prior compliance.
(Emphasis supplied).
Operating on the assumption that the appellant had been permitted to discharge his counsel, the appellant contends that compliance with subsection (a)(3) then requires that the trial judge:
(3) advise the defendant of the nature of the charges in the charging document, and the allowable penalties, including mandatory penalties, if any.
In this case, the appellant was charged by a criminal information filed by the State's Attorney for Queen Anne's County on August 3, 2006. The flagship count was the possession of cocaine with the intent to distribute. The initial appearance of the appellant was set for August 25, 2006, but the summons was "not served." Judge Thomas G. Ross issued a bench warrant for the appellant. It was served on the appellant on September 7, 2006. On September 8, the appellant appeared, without counsel, for a bail review and initial appearance hearing. Judge Ross advised the appellant of the allowable penalties as follows:
THE COURT: So you understand that you are charged with possession of a controlled dangerous substance, not marijuana; that carries four years in prison $25,000 fine or both. Charged with possession with intent to distribute controlled dangerous substance, not marijuana; that carries 20 years in prison, $25,000 fine or both. You're charged with possession of paraphernalia; that's a fine only, unless subsequent offender papers are filed. That carries a $500 fine. Charged with distributing paraphernalia. Let me see about that. That carries a $500 fine. You are charged as well, in Count 5 with driving without a license; carries a $500 fine in this court. You are charged with violation of Transportation Article 16-303(c) driving on a suspended license; that carries a year in jail, $1,000 fine or both.
Charged in the seventh count with driving on a revoked license and privilege; carries a year in jail, $1,000 fine or both. You are charged in Count 8 with a violation of 303(h) of the Transportation Article which is driving a motor vehicle while suspended under certain provisions of the Transportation Article. That carries 60 days in jail, $500 fine or both. You are charged with throwing, dumping, discharge, deposit of refuse on a public highway, carries $500 fine in this court. Charged with driving with an obstructed windshield view which carries a $500 fine in this court.
Okay. I've advise you of the nature of the charges, the range of allowable penalties.
(Emphasis supplied).
The advice as to the allowable sentence for a conviction of possessing cocaine with the intent to distribute was meticulously correct for a first offense on that charge. The "kicker" was that the appellant was apparently a fourth-time offender and was subject to a sentence, pursuant to Criminal Law Article, § 5-608(d), of "not less than 40 years." With respect to the required advice under that circumstance, the unforgiving command of Knox v. State, 404 Md. 76, 88, 945 A.2d 638, is clear:
We hold that "allowable penalties, including mandatory penalties, if any," as stated in Rule 4-215, includes notice of subsequent offender penalties .... Absent information as to mandatory or enhanced penalties, it could hardly be said that a defendant makes a knowing and voluntary decision to waive [or to discharge] counsel with eyes open or with *653 full knowledge of the ramifications of the choice.
(Emphasis supplied). In this case, no advice was given with respect to the "mandatory or enhanced penalties" for a subsequent offender.[1]
Counsel Was Not Discharged
The saving grace is that the triggering event for the imposition of Rule 4-215(a)(3) never came to pass. The activating clause in subsection (e) is:
If this court permits the defendant to discharge counsel, it shall comply with subsections (a)(1)-(4) of this Rule.
(Emphasis supplied). In this case, the trigger was never pulled. Counsel was never actually discharged. The minefield, though it could have been fatal, never actually had to be traversed.
Curt Anderson, Esq. was engaged as privately retained counsel on October 10, 2006. A pretrial conference was scheduled for October 20, 2006, but was "vacated" by mutual consent. Also by consent of the parties, the trial was postponed from November 29 to November 30, 2006. As of the morning of trial, however, trouble was in the air. Apparently Mr. Anderson's appraisal of the case was that the appellant's chances of acquittal were virtually non-existent, that the potential sentence the appellant was facing was heavy, and that the appellant's only feasible strategy was to make the best deal possible for himself. The appellant, on the other hand, was not inclined to deal. Judge Sause assured the appellant that he did not have to agree to a plea.
MR. ANDERSON: Your Honor, as you can imagine, this is a very serious case with the State intending to pull a mandatory 25[on] Mr. Garner iswell
[PROSECUTOR]: Potential.
MR. ANDERSON: Potential, the mandatory for Mr. Garner, if proceeded to trial. For the last couple of days, I've explained to Mr. Garner the nature of the case, the evidence against him. In other words, things that a lawyer does prior to trial and I had recommended to Mr. Garner a certain disposition in this case, as opposed to going to trial and I have, apparently, done too consistently because Mr. Garner has indicated to me that he doesn't think that I have his best interests at heart with regard to this case. He doesn't think I'm going to try the case wholeheartedly because of my continued assertions that he take a plea in the case. Again, the only reason why I have suggested that to himnot the only reasonit's sometimes what I do prior to cases when I think the State after my assessment of the State's case. So I thought I ought to bring that to the Court's attention because I think he was going to stand up and say it, but I *654 thought, perhaps, at a bench conference it might be better.
THE COURT: Oh, yeah, I quite agree with that. Mr. Garner, you heard what Mr. Anderson said, do you want to add anything to that?
THE DEFENDANT: Yes, sir. I feel like he's not going to represent me in my best interest.
THE COURT: Why didn't you do something about it before now?
THE DEFENDANT: Because I thought he was going to try to represent me in my best interests, but after a couple days, I done seen that he's not trying to
MR. ANDERSON: But I told you, I showed you
THE DEFENDANT:and I'm not trying to take a plea. He is trying to force a plea, make me take a plea that I don't want to take.
THE COURT: Well, you don't have to take a plea. I'm not going to make you take a plea.
THE DEFENDANT: I don't feel that he don't want to represent me with my best interests with the case that's at hand.
THE COURT: Well, then you should have done something about it before.
(Emphasis supplied).
The attorney-client relationship that at one point was perilously hanging on the ropes then appeared to catch a second wind.
THE COURT: [Y]ou chose the attorney. If you had problems, you had to work it out with him. Mr. Anderson is a member of the bar, I'm sure if you told him what your feelings were, I'm sure he would have done something about it.
THE DEFENDANT: I have told him.
THE COURT: What?
THE DEFENDANT: He can sit there.
THE COURT: What?
THE DEFENDANT: He can sit there.
THE COURT: Okay. Thank you. Go ahead.
(Emphasis supplied).
At that point, to be sure, the status of the attorney-client relationship was still perilously ambiguous, but it gathered strength as the trial progressed. The appellant's only expressed dissatisfaction with Anderson initially had been over the issue of whether to proceed with a full-blown trial on the merits or to enter a guilty plea. Once that question was resolved as the appellant wished it to be, there was no indication of any further strategic disagreement between attorney and client. The bottom line is that Anderson was never discharged as counsel for the appellant and that the provisions of Rule 4-215(a)(3), therefore, never came into play.
Our concern, and the concern of Rule 4-215, is with the fundamental right of a defendant to have the effective assistance of counsel when going to trial in a criminal case. That basic purpose was well expressed by Judge Orth in Parren v. State, 309 Md. 260, 281-82, 523 A.2d 597 (1987):
It is perfectly clear that the purpose of Rule 4-215 is to protect that most important fundamental right to the effective assistance of counsel, which is basic to our adversary system of criminal justice, and which is guaranteed by the federal and Maryland constitutions to every defendant in all criminal prosecutions.
(Emphasis supplied).
As we assess whether the appellant received that constitutionally guaranteed effective *655 assistance of counsel, we will look to what actually took place at the appellant's trial and not at what looked as if it might take place in the waning moments before the trial began. Although the colloquy at that time was a bit vague, there loomed at least the possibility that Anderson might be discharged and might remain available only in a stand-by capacity by way of giving legal advice if such advice were to be sought by the pro se defendant. In fact, no such watered down relationship ever asserted itself.
Mr. Anderson professionally and ably conducted the complete defense of this case from start to finish. He conducted the voir dire examination of the prospective jurors and then selected the jury. He made a motion in limine. He delivered the opening statement. He cross-examined the State's witnesses and made objections. He called the appellant's girlfriend as a defense witness. He made motions, at the end of the State's case and at the end of the entire case, for a judgment of acquittal. He delivered a closing argument. He referred to the appellant as "my client." The State referred to him as "counsel": "Your Honor, I'm going to file the additional penalties I previously served on counsel, subsequent offender notice." He represented the appellant at sentencing. He filed and argued a new trial motion. Indeed, at that hearing on the motion for a new trial, Judge Sause noted:
I'm delighted to see that there has apparently been a rapprochement. As I pointed out before, Mr. Anderson participated to his usual able way throughout the trial.
(Emphasis supplied).
From the opening gavel through the conclusion of the motion for a new trial, there was never the remotest indication that Mr. Anderson was not full-fledged counsel for the defense. The appellant himself did not actively participate in the conduct of his trial in any way nor did he protest his passive role. This was in no respect the "hybrid representation" described by Parren v. State, 309 Md. at 264, 523 A.2d 597:
Hybrid representation is apparently considered to encompass both the participation of the defendant in the conduct of his trial when he had not effectively waived the assistance of an attorney to defend him, and the participation by an attorney in the conduct of the trial when the defendant was defending pro se.
In this case, it was Mr. Anderson and not the appellant who "called the shots" from start to finish. Judge Orth described the difference in roles.
When a defendant appears pro se, it is he who calls the shots, albeit, perhaps, with the aid, advice and allocution of counsel in the discretion of the trial judge. When a defendant is represented by counsel, it is counsel who is in charge of the defense and his say as to strategy and tactics is generally controlling, but again with such participation by the defendant as the trial judge deems appropriate.
309 Md. at 265, 523 A.2d 597 (emphasis supplied). In the last analysis, the potential Rule 4-215 problem turns out to have been a non-starter. The minefield was finessed.
When Is an Out-of-Court Utterance Non-Hearsay?
That brings us to the fascinating evidentiary issue which is the main feature of this appeal. At the police station following his arrest, the appellant was relieved of his cell phone. When the cell phone rang, Trooper Gussoni answered it by saying, "Hello." A male caller inquired, "Can I get a 40?" but then hung up when Trooper *656 Gussoni asked him his name. Trooper Gussoni actually described the phone as "ringing non-stop." "Again, it was just continually ringing, ringing." Although this brief telephone exchange added little, if anything, to the proof of the appellant's guilt as a possessor, it clearly helped to characterize that possession as commercial in nature and not as simple possession for personal use. The defense moved in limine to have the content of the call excluded from evidence.
Obviously, it's an anonymous call. We don't know who it was from, we don't know if they got the right number and I'm not able, obviously, to cross-examine. I think the reliability of whatever was said on the other end is subject to suspicion and I think the probative value of that would certainly not outweigh the prejudice that it would weigh on my client in this particular case. The person on the other end said something about do you havedo you have a 40.
(Emphasis supplied).
The motion in limine was denied and the State did not hesitate, in opening statement, to characterize the call as precisely the thing it was.
He [had] a cell phone that he was actually talking on immediately when Trooper Gussoni stopped him and his phone kept ringing at the barrack. Eventually, Trooper Gussoni picked it up and the person on the other end of the phone asked himsaid he needed a 40. I think you'll hear from Corporal Michael a 40 is slang for a $ 40 piece of cocaine.
(Emphasis supplied).
In closing argument, the State again referred to the phone call as proving precisely the thing that it validly served to prove, to wit, that the appellant was a pusher and not a mere user.
There are lots of factors for distribution. Very few factors for possession in this case. I mean, not possessionpersonal, mere use. Very little actually, nothing for mere use because there's nothing to use it with. But I keep coming back, I know I said this before, you do not, you do not ca[ll] a user a mere user of cocaine and ask him for a 40. As Corporal Michael tells you, crack cocaine, the language on it is a 20, a 40, a 60, a 80, 100. A 40 is a $40 piece of crack cocaine. Once you do the math, which I did. 6.9 divided by 12, is .53. I don't know if they're all .53. Some could be.4, some could be .6, but we're in that range, between a 40 and a 60, on the average. That's what he's got. Call this guy's phone, the phone is blowing up. Phone is going crazy, Trooper Gussoni probably answers it, maybe it's his girlfriend, yes, I need a 40. That's a pretty big factor.
(Emphasis supplied).
To be admissible, evidence must be competent, relevant, and material. The evidence of the phone call in this case was self-evidently relevant and material. What remains to be tested is its competence. That will depend upon whether it is or is not hearsay. The basic rule, most aptly described as the Rule Against Hearsay,[2] is set out in Maryland Rule of Procedure 5-802.
Except as otherwise provided by these rules or permitted by applicable constitutional *657 provisions or statutes, hearsay is not admissible.
(Emphasis supplied). Rule 5-801, in turn, gives us the necessary definitions to go to work on the problem.
(a) Statement. A "statement" is (1) an oral or written assertion or (2) nonverbal conduct of a person, if it is intended by the person as an assertion.
(b) Declarant. A "declarant" is a person who makes a statement.
(c) Hearsay. "Hearsay" is a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted.
(Emphasis supplied).
Federal Rule of Evidence 801(c), from which the Maryland Rule was derived, is absolutely verbatim with the Maryland definition. The Advisory Committee note to Federal Rule 801(c) states:
The effect of the definition of "statement" is to exclude from the operation of the hearsay rule all evidence of conduct, verbal or nonverbal, not intended as an assertion. The key to the definition is that nothing is an assertion unless intended to be one.
In Ali v. State, 314 Md. 295, 304, 550 A.2d 925 (1988), Judge McAuliffe gave the classic common law definition of hearsay:
Hearsay is generally defined as a statement, other than one made by the declarant while testifying at the trial or hearing, offered in evidence to prove the truth of the matter asserted. Thus, when a statement is offered for some purpose other than to prove the truth of the matter asserted therein, it is not hearsay.
(Emphasis supplied).
Before moving out to the disputed borderland[3] of hearsay and non-hearsay, it is helpful to have a firm grasp of the hearsay center. In Stoddard v. State, 157 Md.App. 247, 257, 850 A.2d 406 (2004), reversed on other grounds, 389 Md. 681, 887 A.2d 564 (2005), this Court described the starting point for analyzing what is an assertion.
At the most basic level, under both the common law and the new Federal and Maryland Rules, a hearsay statement consisted routinely of the speaking of a declarative sentence in the indicative mood, which sentence stated the very fact which the proponent of the statement sought to prove by its use. Early on, however, it was recognized that a hearsay statement could be a writing of an assertion as well as a speaking of it. It was also universally recognized, virtually ab origine, that a hearsay statement could consist of a non-verbal action if the action were intended by the actor to be an assertion. The pointing of a finger at Suspect # 4 is just as assertive as are the words, "The man who robbed me is Suspect # 4." Just as surely assertive, in response to a question, is a vertical shaking of the head ("Yes"), a horizontal shaking of the head ("No"), or a shrug of the shoulders ("I don't know").
(Emphasis supplied).
In Holland v. State, 122 Md.App. 532, 543-44, 713 A.2d 364 (1998), we further explored how an assertion ordinarily does not embrace questions and commands.
To qualify as hearsay, the words recounted in court must, for starters, constitute an assertion or statement of a fact. Many out-of-court utterances are *658 self-evidently not assertions. If a witness testifies to the out-of-court inquiry, "What time is it", that inquiry is obviously not an assertion of anything. For an out-of-court utterance to qualify as an assertion, it generally must be in the indicative or declarative mood, rather than in the interrogative mood, the imperative mood, or the subjunctive mood. An out-of-court assertion of a fact may be true or untrue. For that reason, its admissibility in evidence is problematic if offered to prove that fact. An out-of-court inquiry, "What time is it?" can be, by its very nature, neither true nor untrue and there is, therefore, no such credibility problem. The out-of-court command, "Stop!" can be, by its very nature, neither true nor untrue and there is, therefore, no such credibility problem.
(Emphasis supplied).
In Burgess v. State, 89 Md.App. 522, 537-38, 598 A.2d 830 (1991), Judge Alpert quoted with approval from D. Binder, Hearsay Handbook (3d ed.1991) 18:
Many out-of-court utterances fall within such categories as greetings, pleasantries, expressions of gratitude, courtesies, questions, offers, instructions, warnings, exclamations, expressions of joy, annoyance, or other emotion, etc. Such utterances are not intended expressions of fact or opinion. They are not assertions, at least for purposes of the hearsay rule. Thus they are not hearsay.
"Hello."
"How are you?"
"Have a nice day."
"Would you like to have lunch?"
"I hope it doesn't rain tomorrow."
"I wonder what he paid for that car."
"Thank you."
"Can you join me for a drink?"
"Don't do that, or else."
"Watch your step."
None of the above utterances is an intended expression of fact or opinion. None is hearsay.
(Emphasis supplied). And see United States v. Oguns, 921 F.2d 442, 448-49 (2d Cir.1990) (an inquiry is not an assertion); United States v. Long, 905 F.2d 1572, 1579-80 (D.C.Cir.1990) (questions are non-assertive).
In Carlton v. State, 111 Md.App. 436, 443, 681 A.2d 1181 (1996), Judge Salmon explained how even a question can sometimes qualify as an assertion within the contemplation of the Rule Against Hearsay, although, generally speaking, it would not so qualify.
Many questions asked by an out-of-court declarant can be implied assertions. For example, the question, "Do you need change?" impliedly asserts that the questioner has change. State v. Saunders, 23 Ohio App. 3d 69, 491 N.E.2d 313 (1984). The question, "Why did you stab me, Brutus?" impliedly asserts that the questioner was stabbed by Brutus. On the other hand, many, if not most, questions make no assertion; the questioner simply seeks answers. Burgess v. State, 89 Md.App. 522, 537-38, 598 A.2d 830 (1991).
(Emphasis supplied).
In Carlton, the defendant was convicted of felony murder and armed robbery. In issue was the admissibility of several questions addressed by a co-defendant to a neighbor of the victim. One was whether the victim had an alarm. Another was at what time would the victim normally leave his place of employment. The defendant objected to their admissibility on the ground that the questions constituted hearsay. This Court held that the utterances were not hearsay.
*659 Ussel's questions could not possibly have been "offered in evidence to prove the truth of the matter asserted." Therefore, the hearsay rule was not violated when Ms. Shipley was allowed to repeat the questions Ussel asked her.
111 Md.App. at 443, 681 A.2d 1181 (emphasis supplied).
Joseph F. Murphy, Jr., Maryland Evidence Handbook (3d ed.1999), § 702(B), 261, characterizes the non-assertive questions in the Carlton case as non-hearsay and, therefore, as admissible circumstantial evidence.
Courtney is precedent for the admission of "implied assertions," and correctly treats nonassertive conduct as circumstantial evidence of a material fact.
(Emphasis supplied).
Lynn McLain, Maryland Evidence (2d ed.2001), § 801:4, pp. 39-40, also placed her seal of approval on our discussion in Carlton v. State of the hearsay issue.
In affirming the conviction, a panel of the Court of Special Appeals, in a well-reasoned opinion by Judge Salmon, found that the defendant was not intentionally making an implied assertion, nor was the evidence offered to prove such an implied assertion. Therefore, the evidence was not hearsay.
(Emphasis supplied). The evidence, as non-hearsay, was circumstantial evidence of guilt.
Telephone Calls to a Bookie or a Supplier of Drugs
It is a not infrequent occurrence that the police, after making arrests at a bookmaking parlor or a gambling den or a place where drugs are sold, will pick up a ringing telephone and field the call. The making of a wager or the purchase of a drug, legally or illegally, is a form of contract. Little v. State, 204 Md. 518, 522-23, 105 A.2d 501 (1954). There is an offer and an acceptance. The telephoned words of the would-be bettor or would-be purchaser are frequently categorized, therefore, as verbal parts of acts. They are not considered to be assertions and do not fall under the scrutiny of the Rule Against Hearsay. Sometimes, however, the categorization traveled under the now discredited label of res gestae. See Cassidy v. State, 74 Md. App. 1, 12-14, 536 A.2d 666 (1988). (It was only the academic rationale that has been discredited, not the admissibility per se of the telephoned utterances.)
In John Strong, McCormick on Evidence (4th ed.1992), § 249, "Some Out-of-Court Utterances Which Are Not Hearsay," under the subhead "Verbal parts of acts," p. 102, appears the following:
Similar considerations are commonly said to prevail when the character of an establishment is sought to be proved by evidence of statements made in connection with activities taking place on the premises.7
7 Numerous cases involve prosecutions for conducting a gambling establishment, often those accepting bets on horse races. If a person, while handing over money says, "here's $100. on Thunderer to show in the fourth," the words would qualify as the verbal part of an act, i.e. the act of betting. In some of the cases, police who were on the premises during a raid, answered incoming telephone calls by persons saying they wished to place specified bets. These phone calls have been classed as verbal acts.
(Emphasis supplied). Joseph F. Murphy, Jr., Maryland Evidence Handbook (3d ed.1999), § 702(A), 260, similarly classifies these cases as instances of "Verbal Acts or Verbal Parts of an Act."
In Maryland the contents of such calls have historically been held to be admissible evidence. In Courtney v. State, 187 Md. 1, 48 A.2d 430 (1946), the police raided a bookmaking parlor and one of the officers answered the ringing telephones. *660 Over "the period of an hour various persons calling from places unknown placed $85 in bets with him." 187 Md. at 3, 48 A.2d 430. The contents of the calls were held to be admissible.
[T]he evidence, as we have seen, was offered to show that the place in question was a gambling place and that some or all of the persons found therein were engaged in taking bets in violation of law. For these purposes it was proper.
187 Md. at 6, 48 A.2d 430. See also Alexander v. State, 198 Md. 395, 397, 84 A.2d 98 (1951); White v. State, 204 Md. 442, 104 A.2d 810 (1954).
In Best v. State, 71 Md.App. 422, 526 A.2d 75 (1987), the incoming telephone call fielded by the police in the course of executing a search warrant was for the purpose of purchasing a narcotic drug. We noted initially:
[I]t would be unreasonable to require police officers executing a search and seizure warrant, once lawfully on the premises to be searched, to ignore the ringing of a telephone or a knock at the door.
71 Md.App. at 432, 526 A.2d 75 (emphasis supplied).
Judge Karwacki's explanation in Best of why the content of the incoming call was non-hearsay remains the definitive analysis.
"Hearsay may be defined as an out-of-court assertion offered in court for the truth of the matter asserted, resting for its value upon the credibility of the out-of-court asserter." Ali v. State, 67 Md.App. 339, 343, 507 A.2d 648 (1986). Detective Eller's testimony concerning his conversation with Debbie from Delaware was not offered in court for the truth of what Debbie, the out-of-court asserter, said; rather, it was offered as evidence of the fact that the call was made. As such, Detective Eller's testimony was not hearsay at all, but evidence of a verbal act. United States v. Hansbrough, 450 F.2d 328, 329 (5th Cir. 1971). Testimony concerning telephone calls made to or received at a particular location has been held admissible frequently in prosecutions for bookmaking and other gambling activities, where such testimony is offered not to establish the truth of what was said over the telephone, but as evidence that the calls were made to the location for the purpose of placing bets. Analogously, Detective Eller's testimony about the phone call in this case was offered as evidence that the call was made for the purpose of arranging an illegal drug transaction. The trial court did not err in admitting Detective Eller's testimony.
Id. (emphasis supplied). Nothing in either Stoddard, 389 Md. 681, 887 A.2d 564 or Bernadyn, 390 Md. 1, 887 A.2d 602 expressly casts any doubt on the continuing vitality of Judge Karwacki's reasoning in Best. We also find the painstaking analysis in United States v. Zenni, 492 F. Supp. 464 (E.D.Ky.1980), to be very persuasive. In the course of a warranted search for evidence of bookmaking, the government agents "answered the telephone several times." The unknown caller "stated directions for the placing of bets on various sporting events." 492 F.Supp. at 465. After an extensive analysis of the hearsay issue involved, the District Court ruled that the contents of the phone calls were not intended to be assertions and, therefore, did not satisfy the definition of hearsay evidence.
Applying the principles discussed above to the case at bar, this court holds that the utterances of the bettors telephoning in their bets were nonassertive verbal conduct, offered as relevant for an implied assertion to be inferred from them, namely that bets could be placed *661 at the premises being telephoned. The language is not an assertion on its face, and it is obvious these persons did not intend to make an assertion about the fact sought to be proved or anything else.
492 F.Supp. at 469 (emphasis supplied). See also United States v. Perez, 658 F.2d 654, 659 (9th Cir.1981); United States v. Jackson, 588 F.2d 1046, 1049 n. 4 (5th Cir.1979).
In United States v. Long, 905 F.2d 1572 (D.C.Cir.1990), a warranted search of a premises for narcotics was in process when the police answered a telephone call. The caller wanted to know whether Keith (the defendant) "still had any stuff." When the officer sought clarification, the caller explained that she was asking about "a fifty." The defendant Long objected to the admissibility of the contents of the call on the ground that it was an implied assertion that the defendant had narcotics for sale. The Circuit Court of Appeals for the District of Columbia rejected the challenge on the basis that it was not an assertion.
Although the rule does not define "assertion," the accompanying advisory committee note stresses that "nothing is an assertion unless intended to be one." The caller's words, thus, cannot be characterized as an "assertion," even an implied one, unless the caller intended to make such an "assertion." ... [T]he crucial distinction under rule 801 is between intentional and unintentional messages, regardless of whether they are express or implied. It is difficult to imagine any question or for that matter any act, that does not in some way convey an implicit message.
905 F.2d at 1579-80 (emphasis supplied).
The D.C. Circuit made it very clear that the mere fact that the call could serve as the predicate for a damaging inference does not make it an intentional assertion.
With our inquiry focused on the intent of the caller, we have little trouble disposing of Long's theory about implied assertions.... The caller may indeed have conveyed messages about Long through her questions, but any such messages were merely incidental and not intentional. Because the caller's questions were nonassertive, they fall outside the scope of the hearsay rule, and the trial judge did not err in admitting the testimony concerning the questions.
Id. at 1580 (emphasis supplied).
United States v. Lewis, 902 F.2d 1176 (5th Cir.1990), also involved a telephone call, but one with an added dimension. The police arrested the defendant Lewis as a narcotics pusher and seized from him a pager or beeper. When the pager began beeping, the police called the number displayed on it. The person on the other end of the line picked up the phone and asked, "Did you get the stuff?" The defendant interposed a hearsay objection, which the Fifth Circuit rejected:
The questions asked by the unknown caller, like most questions and inquiries, are not hearsay because they do not, and were not intended, to assert anything.
902 F.2d at 1179 (emphasis supplied).
The Fifth Circuit went on to explain why implied assertions do not qualify as "statements" within the contemplation of the Rule Against Hearsay as that rule is now almost universally defined.
Appellants argue that while the questions in this case are not direct assertions, there are certain assertions implicit in the questions. For example, they argue that implicit in the question "Did you get the stuff?" is an assertion that Lewis and/or Wade were expecting to receive some "stuff." However, Rule *662 801, through its definition of "statement," forecloses appellants' argument by removing implied assertions from the coverage of the hearsay rule.
Id. (emphasis supplied).
As these federal circuit court decisions illustrate, the danger of a sweepingly broad definition of "implied assertion" is that virtually every utterance can arguably be deemed to be an implied assertion of the thing it is offered to prove, no matter how attenuated the string of inferences. Without some constraint on the process, there could be virtually nothing left to the very concept of non-hearsay. The utterance, after all, would not be offered if it were not offered to prove something. In a sense, any piece of evidence "implies" the thing it is offered to prove, lest it be deemed irrelevant. That is why the participle "implied" is such a treacherous term. Any doctrinal discipline, if it is to exist, must be found in the noun "assertion." A careful and insistent application of the term "assertion" is an indispensable antidote to the promiscuous explosion of the Rule Against Hearsay.
The Reach and the Future of Stoddard and Bernadyn
In arguing that the anonymous telephone caller's question, "Can I get a 40?" was an implied assertion that the appellant was a seller of cocaine and that it, therefore, fell under the ban of the Rule Against Hearsay, the appellant, of necessity, relies upon a broad reading of the Court of Appeals opinions in Stoddard and Bernadyn. The appellant's tactic is an astute one. It also pinpoints for us the precise point on which our decision must pivot one way or the other.
If we give Stoddard and Bernadyn the broad and expansive reading urged by the appellant, the untethered sweep of "implied assertions" could easily embrace the anonymous caller's question in this case. Indeed, a large part of the pre-Stoddard and pre-Bernadyn constraint on the excessive overuse of the Rule Against Hearsay was the requirement that the out-of-court declaration actually be an assertion. A broad definition of implied assertion, however, as any utterance that can be used by its proponent to prove anything effectively excises the word "assertion" out of every definition of hearsay. It brings into play the very looseness of language (and of thought) that we cautioned against in our Stoddard v. State, 157 Md.App. at 273 n. 12, 850 A.2d 406.
The problem, of course, is that the phrase "implied assertion," in widespread use for 150 years, had nothing to do with an action's or an utterance's being assertive. It was simply a poor choice of words to connote the capacity of the action or the utterance to be, circumstantially, the trigger for an inference. The sophisticated may be comfortable with it, but the very idea of a non-assertive assertion is going to continue to trip a lot of people up.
(Emphasis supplied).
If, on the other hand, we read the decisions in Stoddard and Bernadyn conservatively and as carefully confined to the situations before the Court on those occasions, we would not hesitate to hold the brief telephoned inquiry in this case was non-hearsay and, therefore, admissible. Stoddard and Bernadyn were not dealing with that variety of non-hearsay frequently described by the academic commentators as "verbal parts of acts." Stoddard and Bernadyn did not overrule, or even mention, for example, Judge Karwacki's decision in Best v. State or the impressive body of nationwide caselaw represented by Best v. State.
Although we would not normally presume to undertake such an assessment, *663 the pivotal decision of which way to turn in this case leaves us no choice but to attempt to diagnose the relative vitality or fragility of Stoddard and Bernadyn.
Fields v. State: A Harbinger of Retreat
Almost four months after Stoddard and Bernadyn were decided, this Court filed its opinion in Fields v. State, 168 Md.App. 22, 895 A.2d 339 (2006). The appellant there was convicted of one count of first-degree murder and two counts of first-degree assault. The evidence showed that Fields had engaged in a shooting spree just outside a bowling alley. His defense "was that he was not the shooter and was not even present at the bowling alley when the shootings happened." 168 Md. at 28, 176 A. 474.
A key item of State's evidence helped to prove that Fields was, indeed, at the bowling alley on the night of the shootings. There was a television monitor at each bowling lane. The names and scores of the bowlers at that lane were displayed on a screen. One of the three names on the screen above Lane 22 was "Sat Dogg." Other evidence established that Fields's nickname was "Sat Dogg."
The defense contention before the trial court was that the writing of the name "Sat Dogg" was hearsay because it was an implied assertion of the fact that Sat Dogg was present at the bowling alley that night.
Immediately before the start of trial, the defense moved in limine to preclude the State from eliciting testimony from Detective Canales that the name "Sat Dogg" appeared on a television screen in the bowling alley or introducing into evidence the detective's handwritten list showing that the name "Sat Dogg" appeared on the television screen at bowling lane 22. Defense counsel argued that the evidence was hearsay. Specifically, she maintained that the name "Sat Dogg" on the screen was an implied assertion, by an unknown declarant, made out of court, that the appellant was present in the bowling alley that night; and the State was offering the implied assertion in evidence to show its truth. Because the evidence did not fall within any exception to the rule against hearsay, it was inadmissible.
168 Md.App. at 29, 895 A.2d 339 (emphasis supplied). The trial judge denied the motion, ruling that there was no reason to think that the writer of the name intended it to be "an assertion that the appellant was present at that location." Id. at 30, 895 A.2d 339. Fields was convicted of all three crimes.
The procedural history of the Fields appeal provides insight into some arguable restiveness within the Court of Appeals about Stoddard and Bernadyn. An unreported opinion of this Court, authored by Judge Deborah Eyler, had initially affirmed Fields's conviction. It was filed on May 25, 2005. One of the contentions was the hearsay issue. This Court rejected it. On December 8, 2005, the Court of Appeals filed its decisions in Stoddard and Bernadyn. On January 11, 2006, the Court of Appeals vacated the decision of this Court in the Fields case and remanded the case to us for reconsideration in light of Bernadyn. In our published opinion of March 30, 2006, Judge Eyler reaffirmed our earlier position.
We have reconsidered our decision in light of the Court of Appeals's decision in Bernadyn, and shall affirm the judgments of the circuit court.
168 Md.App. at 26, 895 A.2d 339.
Our opinion acknowledged that, under Stoddard, the ruling of the trial judge that the writing was not hearsay because it was *664 not intended to be an assertion could no longer be sustained.
[T]he reason the trial judge gave for concluding that the evidence that the appellant's nickname was on a television screen in the bowling alley was non-hearsay was incorrect, under Stoddard. The trial judge determined that the person who entered the name "Sat Dogg" on the screen did not intend to assert that the appellant was present in the bowling alley. If the words "Sat Dogg" were an implied assertion of the factual proposition that the appellant was present in the bowling alley at the time of the shootings, it would make no difference whether the "declarant" of the words intended to convey that factual proposition.
168 Md.App. at 35-36, 895 A.2d 339 (emphasis supplied).
We nonetheless held that the writing was not hearsay for the independent reason that it was non-assertive circumstantial evidence that Fields was at the crime scene.
The appellant's name on the television screen in the bowling alley was not an implied assertion of the factual proposition that the appellant was present at the bowling alley, although it was circumstantial evidence that could be probative of that fact. Because the evidence was not an "assertion," under Rule 5-801(a), it was not a "statement" under that subsection and hence was not hearsay under Rule 5-801(c). It was admissible non-hearsay evidence.
Id. at 38, 895 A.2d 339 (emphasis supplied).
Judge Kenney was also a member of that panel and dissented from the majority decision. It was his opinion that the writing, under the authority of Stoddard and Bernadyn, was an implied assertion and was, therefore, hearsay.
Stoddard and Bernadyn lead me to conclude that the evidence at issue cannot be treated merely as circumstantial evidence from which a fact finder might conclude that appellant was present at the bowling alley on the night of the incident, a fact that appellant denies.... [T]he name "Sat Dogg" on the television monitor, standing alone, has no purpose except to assert that appellant was obviously present and bowling on Lane 22 on the night in question. Its probative value is dependent on an unknown scribe's belief that one of the bowlers on lane 22 was "Sat Dogg," and the accuracy of that belief.
168 Md.App. at 49-50, 895 A.2d 339 (emphasis supplied).
On June 14, 2006, the Court of Appeals granted certiorari expressly to consider the specific question of "whether the Court of Special Appeals erred in holding that petitioner's nickname, `Sat Dogg,' which was displayed on a television monitor above a bowling lane, was not hearsay." 390 Md. 513, 889 A.2d 1025 (2006).
The issue was thus cleanly joined. It would have been hard to drive a wedge between the circumstantial nature of the evidence in Fields and the circumstantial nature of the evidence in Bernadyn. There was no impediment to the deciding of the case on the issue for which certiorari had been granted. The decision in the case was filed on December 8, 2006, one year to the day after Stoddard and Bernadyn had been handed down. Fields, 395 Md. 758, 912 A.2d 637. After a routine recitation of the facts of the case and of its procedural history, the Court based its decision on a not particularly certworthy alternative ground.
We need not determine whether the testimony of Detective Canales was inadmissible based on Bernadyn, or even if the evidence is distinguishable, because *665 even if it was hearsay and not admissible, any error was harmless beyond a reasonable doubt.
395 Md. at 763-64, 912 A.2d 637 (emphasis supplied).
In the wake of Fields, only an automaton could refrain from asking, "Why?" We would have to be blind not to conclude that something was in ferment behind the scenes; and that it was something other than a ringing endorsement of Stoddard and Bernadyn. Perhaps the energy that fueled the Stoddard and Bernadyn decisions a year ago has to some greater or lesser extent cooled. We are not suggesting for a moment that we would not follow the express and literal holdings of Stoddard and Bernadyn. We are simply pointing out that, in order to decide this case, we have to read the tea leaves. Reading those auguries, we are not persuaded to give Stoddard and Bernadyn a liberal or expansive interpretation.
The Plague of Plain Error
In establishing his expertise on the subjects of drug use, detection, identification, and distribution, Corporal Aaron Michael of the Maryland State Police Drug Task Enforcement Division testified that he had made between 75 and 100 cocaine related arrests. On cross-examination it was brought out that Corporal Michael had never arrested the appellant. From that modest launching pad, the defense attempted a Herculean leap of logic in closing argument. It sought to persuade the jury that if Corporal Michael, with 75 to 100 notches in his belt in a sparsely populated rural area, had never arrested the appellant, the appellant, ipso facto, must have had a clean record. The State objected, and Judge Sause reminded defense counsel that Corporal Michael was not the only police officer in Queen Anne's County.
[DEFENSE COUNSEL]: [C]learly had this gentleman been arrested for distribution before by the expert, who had made 75 to 100 arrests, he could have brought that up, talked about that, "You know, this is one of the guys that we know about" or something like that.
Clearly, had they made buys from him in the past, they could say, "Come to think of it, we made buys from him"
[PROSECUTOR]: I'm going to object, Your Honor, we can't raise that.
THE COURT: Pardon me?
[PROSECUTOR]: He is saying we could have raised if we made buys from him or not in the past. We can't, we can't say that we know about him or not, we can't say that.
THE COURT: That's right. All right. That is correct. So, Mr. Anderson, as you know.
[DEFENSE COUNSEL]: I was going on what the corporal actually said with regard to him having never arrested Mr. Garner in the past.
THE COURT: Okay.
[DEFENSE COUNSEL]: I'll leave it at that.
THE COURT: I mean, there are an awful lot of police officers in Queen Anne's County and
[DEFENSE COUNSEL]: That's true.
THE COURT: Go ahead.
(Emphasis supplied).
In an even more Herculean leap of logic, the appellant now contends that Judge Sause, in effect, told the jury that the appellant had a criminal record for narcotics violations. He claims that his case was hopelessly compromised.
There is no possible construction of this remark which does not presuppose that Mr. Garner had a criminal history related *666 to drug distribution. Judge Sause's extremely prejudicial comment, which was made in full hearing of the jury, requires reversal.
We are not disposed to give the matter any further thought. There was no objection, and the issue is not preserved for appellate review. Maryland Rule 4-323(c). In that the appellant, strangely, does not even ask us to overlook non-preservation, this contention may qualify as an instance of non-preservation squared. By arguing the contention at length, however, the appellant would seem to invoke, at least implicitly, the plain error provision of Rule 8-131(a).
The frequency with which we are called upon to throw the life preserver of plain error to sinking (and eminently sinkable) contentions is almost a litigational scandal. It is as if appellate preservation had become an anachronistic embarrassment. We know, of course, that the possibility of plain error is out there, and on a rare and extraordinary occasion we might even be willing to go there. One must remember, however, that a consideration of plain error is like a trip to Angkor Wat or Easter Island. It is not a casual stroll down the block to the drugstore or the 7-11. The exaggerated cry of alarm in this case evokes no echo of Angkor Wat or Easter Island.
JUDGMENT AFFIRMED; COSTS TO BE PAID BY APPELLANT.
NOTES
[1] It would seem harsh, were we required to do so, to hold that a judge was in error for failing to anticipate Knox v. State, which was only filed on March 20, 2008. The advice as to the possible penalties in this case was given on September 8, 2006, eighteen months before the Knox opinion was filed. The trial in this case concluded with sentencing on May 11, 2007, ten months before the Knox opinion was filed. As Knox itself acknowledged, its holding was by no means foreordained.
Rule 4-215 does not mention enhanced or mandatory penalties based upon subsequent offender status .... The omission of the subject reasonably could suggest that the legislative intent was to treat subsequent offender penalties separately from the general advice provision of Rule 4-215. In contrast, the general language of Rule 4-215 may be read as inclusive of subsequent offender penalties because it uses broad, unlimited language. We conclude that ... Rule 4-215 is ambiguous.
404 Md. at 86, 945 A.2d 638 (emphasis supplied).
[2] In Cassidy v. State, 74 Md.App. 1, 7-8, 536 A.2d 666 (1988), this Court explained:
The full name of the rule is The Rule Against Hearsay. Although subject to multitudinous exceptions, the Rule, in its essence, is a rule of exclusion.... The opponent of hearsay does not have to show why it should be rejected. The fact that it is hearsay is, presumptively, reason enough.
[3] An excellent overview and a good starting point for analysis is Charles McCormick, "The Borderland of Hearsay," 39 Yale L.J. 489 (1930). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564442/ | 929 S.W.2d 309 (1996)
Harold COFFMAN, Appellant,
v.
Nora POWELL, Respondent.
No. 20377.
Missouri Court of Appeals, Southern District, Division Two.
September 23, 1996.
*310 George D. Nichols, Nichols & Nichols, Lamar, for appellant.
Rebecca L. Elliston, Stockton, for respondent.
MONTGOMERY, Chief Judge.
Harold Coffman (Appellant) and Nora Powell (Respondent) shared Respondent's home from January 1992 until June 1993. Throughout the period of cohabitation Appellant brought various items of personal property to the residence. Much of this property remained in Respondent's home after Appellant moved out.
On September 30, 1994, Appellant filed a replevin action seeking return of the personal property he left with Respondent "for storage and safekeeping." Appellant prayed for damages in the amount of $25,830 if delivery *311 of the property was not possible. Respondent filed a counterclaim seeking the return of her personal property and reimbursement for various expenses incurred during the period of cohabitation.
The trial court heard the case on May 23, 1995. On June 23, 1995, the court entered judgment for Appellant on his claims. The court ordered Respondent to return the items still in her possession and entered judgment for $4200 against her for the items that she was unable to return. With respect to Respondent's counterclaim, the trial court ordered Appellant to return Respondent's personal property and granted judgment against him in the amount of $3700. The court noted that neither party requested findings of fact or conclusions of law and, therefore, the judgment contained none.
In Appellant's sole point on appeal, he contends the trial court erred in awarding him $4200 for the converted property because the only evidence of value far exceeded this amount.
In a court-tried case, the reviewing court affirms the trial court's decision unless there is no substantial evidence to support it, unless it is against the weight of the evidence or unless it erroneously declares or applies the law. Murphy v. Carron, 536 S.W.2d 30, 32 (Mo.banc 1976); Witeka v. Director of Revenue, 913 S.W.2d 438, 440 (Mo.App.1996). Appellant argues that there was no substantial evidence to support a valuation of $4200 for his unreturned property. The evidence adduced at trial follows.
Appellant terminated his relationship with Respondent and moved out of her residence in June 1993. During the relationship, Appellant kept much of his personal property at Respondent's home. He did not attempt to remove the majority of his property until December 1993. By this time Respondent had sold some items and could not account for the location of other items. She refused to return several pieces of furniture that she considered gifts. The court ordered the return of the furniture, and it is not at issue in this appeal.
At trial, Appellant gave a description of the personal property at issue, the price he paid for some items, and his estimate of the current value or "worth" of each item as follows:
ITEM PAID VALUE
Makita miter box $ 400.00 $ 350.00
Metal cut off saw 225.00 195.00
Echo weed eater 225.00
10' john boat 175.00
27" Motorola color TV 375.00
VCR 150.00
650 John Deere 4-wheel
drive tractor 1500.00 8000.00
6' 3-point rear mower 1745.00 1700.00
4' John Deere brush hog 450.00
1921 Model T 1-ton truck 1600.00 5000.00
1963 Triumph motorcycle 600.00 3400.00
David White water level 250.00 195.00
Microwave oven 125.00 100.00
2-drawer night stand 50.00
22" Murray lawn mower 110.00 (approx.) 100.00
16" McCullough chainsaw 150.00 (approx.) 100.00
Battery charger 80.00 (approx.) 50.00
24' Extension fiberglass
ladder 400.00 350.00
In addition to his own testimony, Appellant offered the expert testimony of Dennis Campbell, owner of the Case-International dealership in Springfield, Missouri. Campbell testified that a John Deere 650 tractor, like Appellant's, had a fair market value of approximately $7000. Appellant also offered expert testimony concerning the value of the 1963 Triumph motorcycle. Appellant's expert opined that the motorcycle would be worth approximately $3400 if it were in excellent condition and retained the original seat cover and paint.
Respondent could not account for the location of some of the listed items. She testified that she thought Appellant removed most of the items in December of 1993. She admitted she sold the John Deere tractor, the 1921 Model T one-ton truck, and the Triumph motorcycle. She placed these items in her front yard and sold them for $3800 cash. She offered no other evidence of the value of these items.
After the hearing, the trial court entered judgment in the sum of $4200 against Respondent for the conversion of Appellant's above-listed personal property. The judgment does not suggest how the trial court determined that the fair market value of the converted items amounted to $4200 nor does it specify the value of each item included in that amount.
*312 Generally, due deference must be given to the trial court's resolution of conflicting evidence. Estate of Hatten v. Mercantile Bank of Springfield, 884 S.W.2d 326, 329 (Mo.App.1994). Where there is a conflict in evidence of property value, deference must be given to the trial judge's resolution of the conflict. Schelsky v. Schelsky, 796 S.W.2d 888, 893 (Mo.App.1990). In this case, however, the only evidence of value, other than sales price, was presented by Appellant.
By Respondent's own admission, she converted some of Appellant's personal property to her own use and sold it. The proper measure of damages for the conversion of personal property is the fair market value at the time and place of the conversion. Alpine Paper Co. v. Lontz, 856 S.W.2d 940, 944 (Mo.App.1993). "Fair market value" is defined as "`the price which property will bring when it is offered for sale by an owner who is willing but under no compulsion to sell and is bought by a buyer who is willing or desires to purchase but is not compelled to do so.'" Bridgeforth v. Proffitt, 490 S.W.2d 416, 425 (Mo.App.1973) (citing Carter v. Matthey Laundry & Dry Cleaning Co., 350 S.W.2d 786, 794 (Mo.1961)). Respondent's sales price evidence fails to meet this standard.
Other than offering her opinion that she received a fair price, Respondent did not offer other evidence to suggest she received the fair market value for the truck, motorcycle, and tractor at the time and place she sold them. The price Respondent received for the items is not evidence of a price at which a willing owner would sell.
Appellant and his experts testified that the property in question had a value far exceeding that which the trial court settled upon. Respondent testified that she received only $3800 for the truck, motorcycle, and tractor she sold. It is her opinion that the sales price serves as evidence of the fair market value of such property. While an owner of property may establish the value of such property through his opinion testimony, DeLong v. Hilltop Lincoln-Mercury, Inc., 812 S.W.2d 834, 841 (Mo.App.1991), Respondent was not the owner of the property in question.
The trial court is entitled to believe all, part, or none of the testimony of any witness. Hugenel v. Estate of Keller, 867 S.W.2d 298, 302 (Mo.App.1993). The judge was not required to believe the values assigned by Appellant or his expert witnesses. Evidently the judge found Appellant's valuation evidence inflated. It is true in a court-tried case the trial judge is free to make a finding of value within the range of values testified to at trial. Theilen v. Theilen, 847 S.W.2d 116, 118-19 (Mo.App.1992); Howerton v. Howerton, 796 S.W.2d 665, 667 (Mo.App.1990).
One of the problems in this case is that the trial court appears to have assigned an arbitrary value below the range presented due to disbelief of Appellant's valuation evidence. From the record we must conclude that the sales price erroneously formed the basis for the judgment.
Another problem is that the judgment does not decide the fair market value of each of the above-listed items. The judgment simply lists the items and finds that the collective fair market value is $4200.
It is the duty of this court to dispose finally of the case unless justice otherwise requires. Rule 84.14. "That duty, however, presupposes a record and evidence upon which this court can perform that function with some degree of confidence in the reasonableness, fairness, and accuracy of its conclusion. When such record and evidence are not presented, `reversal and remand necessarily follow.'" Taylor v. Coe, 675 S.W.2d 148, 150 (Mo.App.1984).
In this case reversal and remand are required. This court cannot enter judgment in favor of Appellant using the values he presented at trial with a degree of confidence in the reasonableness, fairness, and accuracy of such judgment. The trial court was in a better position to view the credibility of the parties. While the trial court concluded Appellant was entitled to recover, the court clearly did not find Appellant's evidence on damages to be credible. Nonetheless, there *313 is insufficient evidence within the record to support the judgment for $4200. Accordingly, we reverse the judgment as to Appellant's damages and remand the cause for a new trial on that issue only.[1]See Bridgeforth, 490 S.W.2d at 426.
CROW, P.J., and PARRISH, J., concur.
NOTES
[1] Upon remand, the parties should be mindful that "[n]either original cost nor [Appellant's] subjective opinions as to `value' or `worth' of used articles of personalty may be equated with or substituted for `fair market value.'" Bridgeforth, 490 S.W.2d at 425. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564137/ | 75 F.2d 696 (1935)
JOHN A. NELSON CO.
v.
COMMISSIONER OF INTERNAL REVENUE.
No. 5146.
Circuit Court of Appeals, Seventh Circuit.
February 23, 1935.
*697 J. S. Seidman, of New York City, for petitioner.
Frank J. Wideman, Asst. Atty. Gen., and Sewall Key and Robert N. Anderson, Sp. Assts. to Atty. Gen., for respondent.
Before SPARKS and FITZHENRY, Circuit Judges, and LINDLEY, District Judge.
LINDLEY, District Judge.
The taxpayer petitions for a review of a decision of the Board of Tax Appeals, assessing additional taxes based upon a holding that the transaction hereinafter discussed was not a reorganization within the meaning of the Revenue Act. Two questions are involved: First, whether a stipulation between the parties that on December 31, 1926, petitioner "was a party to a reorganization" is decisive of the question as to whether or not the transaction herein involved amounted to a reorganization within the meaning of section 203 (h) of the Revenue Act of 1926 (26 USCA § 934 (h); and, second, if such stipulation is not determinative, whether the transaction was a reorganization within the meaning of the statute.
In the stipulation of the parties before the Board, one recital was that on December 31, 1926, petitioner "was a party to a reorganization." If this stipulation is to be treated as an agreement "concerning the legal effect of admitted facts," it is obviously inoperative; "since the court cannot be controlled by agreement of counsel on a subsidiary question of law." Swift & Co. v. Hocking Valley R. Co., 243 U.S. 281, 289, 37 S. Ct. 287, 290, 61 L. Ed. 722.
The actual question presented to the Board necessary to a final decision upon the merits was whether there was a reorganization. The stipulation was clearly an attempt to stipulate the existing facts to be within a certain legal definition. Whether there was a reorganization in view of all the facts presented was a question of construction of statutory law, and the agreement between counsel as to such construction was not binding upon the court and must be disregarded. It was either an agreement that entirely removed the question from the proceeding, or it was an attempt to limit the function of the Board to decide the issues of liability. Consequently it is ineffective. To hold otherwise that a stipulation that facts which do not under the law constitute reorganization do effect a reorganization would necessitate that the court *698 entertain a question which is not in actual controversy between the parties but one based upon the stipulation of the parties as to a fictional situation, thus presenting a moot case, Swift & Company v. Hocking Valley R. Co., 243 U.S. 281, 37 S. Ct. 287, 61 L. Ed. 722. See Smith v. Commissioner (C. C. A.) 59 F.(2d) 533, holding that a stipulation that a certain transaction amounted to a gift did not exclude the Board or the court from determining that question; United States v. Pugh, 99 U.S. 265, 25 L. Ed. 322, holding that the ultimate effect of the facts which the evidence establishes is in the nature of a question of law subject to review by the court. The question of what constitutes a reorganization is one that arises from a consideration of all the facts and is not determined by a mere label or rubber stamp which the parties themselves put upon as the transaction. Gregory v. Helvering, 293 U.S. 465, 55 S. Ct. 266, 79 L. Ed. ____ (January 7, 1935.) The Board, therefore, had before it for determination the question as to whether or not a reorganization occurred.
The facts are undisputed and disclose that the transaction does not come within the intendment of the congressional definition of reorganization. On November 18, 1926, petitioner entered into a contract with Elliott-Fisher Company, a Delaware corporation, under the terms of which the latter agreed to organize a new corporation with a capital stock of 12,500 shares of (nonvoting) preferred stock, and 30,000 shares of (voting) common stock, and to purchase all the common stock for $2,000,000 in cash. Thereafter, the new corporation purchased from petitioner substantially all of its property, with the exception of $100,000 in cash, paying therefor to petitioner $2,000,000 in cash and 12,500 shares of preferred stock in the new company. Out of the cash thus received petitioner called for redemption and retired its own preferred stock and distributed to its stockholders the preferred stock of the new company and the remainder of the cash received as purchase price. Petitioner was not dissolved. It retained its franchise and $100,000 in cash and acquired no interest in the corporation to whom it delivered its property, other than the preferred shares of stock, which it distributed to its stockholders. This preferred stock had no voice in the control of the new corporation, except in case of default in payment of dividends thereon. Petitioner remained liable for certain liabilities and for taxes.
When we analyze these facts, it is apparent that the transaction essentially constituted a sale of the greater part of petitioner's assets for cash and the preferred stock in the new corporation, leaving the Elliott-Fisher Company in entire control of the new corporation by virtue of its ownership of the common stock.
The controlling facts leading to this conclusion are that petitioner continued its corporate existence and its franchise and retained a portion of its assets; that it acquired no controlling interest in the corporation to which it delivered the greater portion of its assets; that there was no continuity of interest from the old corporation to the new; that the control of the property conveyed passed to a stranger, in the management of which petitioner retained no voice.
It follows that the transaction was not part of a strict merger or consolidation or part of something that partakes of the nature of a merger or consolidation and has a real semblance to a merger or consolidation involving a continuance of essentially the same interests through a new modified corporate structure. Mere acquisition by one corporation of a majority of the stock or all the assets of another corporation does not of itself constitute a reorganization, where such acquisition takes the form of a purchase and sale and does not result in or bear some material resemblance to a merger or consolidation. As was said in West Texas Refining & Development Co. v. Commissioner (C. C. A.) 68 F.(2d) 77, 80: "The purpose of section 203, supra, was to relieve corporations from profits taxes in cases where there is only a change in corporate form without an actual realization of any gain from an exchange of properties. It is intended to apply to cases where a corporation in form transfers its property, but in substance it or its stockholders retain the same or practically the same interest after the transfer. See Cortland Specialty Co. v. Commissioner (C. C. A. 2) 60 F.(2d) 937, 940; Pinellas Ice & Cold Storage Co. v. Commissioner, 287 U.S. 462, 53 S. Ct. 257, 77 L. Ed. 428; Id. (C. C. A. 5) 57 F.(2d) 188. Here it was contemplated that in substance the West Texas Company should dispose of its assets and receive therefor a cash consideration, and also stock. What was done amounted to a single transaction for income tax purposes, and when it was fully consummated the West Texas Company had received only a 50% stock interest in the Col-Tex Company and $184,771.34 in cash. *699 Therefore the transaction was not within the exceptions defined in section 203, supra, and must be considered as a sale."
In the recent case of Gregory v. Helvering, supra, the Supreme Court has pointed out that it is essential, in order to carry into effect the intent of Congress in this respect, that an examination of the facts be had to determine whether there was indeed reorganization, even though the parties themselves may call a transaction a reorganization. The court held that though it had no right to inquire into the motive of taxpayers in performing a legal act, it did have a right to say that the claim of reorganization was a mere legal fiction.
The decision of the Board of Tax Appeals is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1565260/ | 433 S.W.2d 904 (1968)
Jesse Allen SULLIVAN, Appellant,
v.
The STATE of Texas, Appellee.
No. 33308.
Court of Criminal Appeals of Texas.
November 20, 1968.
Jesse Allen Sullivan, pro se.
Leon B. Douglas, State's Atty., Austin, for the State.
OPINION
DICE, Judge.
Appellant was convicted in the District Court of Hood County, in the year 1960, of the offense of burglary and his punishment was assessed at confinement in the penitentiary for twelve years, being enhanced under Art. 62, Vernon's Ann.P.C., by reason of a prior conviction for an offense of like character.
In an appeal to this court in which the record did not contain a statement of facts and appellant was not represented by counsel, the judgment was affirmed in a per *905 curiam opinion delivered April 12, 1961, unreported.
On February 2, 1968, appellant filed in the District Court of Hood County his petition for writ of habeas corpus, in which he alleged that he was being illegally restrained of his liberty under the judgment of conviction, without due process of law, becausedue to his indigencyhe was deprived of both the services of an attorney and a record in the appeal.
After a hearing in which an attorney was appointed to represent appellant, whose services were by him declined, the Honorable W. J. Oxford, judge of said court, granted to the appellant an out-of-time appeal and directed the court reporter to prepare and furnish him with a statement of facts of the evidence adduced upon the original trial.
At such hearing, appellant advised Judge Oxford that he desired to represent himself on the appeal and did not want counsel appointed to represent him.
In refusing appellant's petition that he be discharged from confinement, the court did not err.
The statement of fact is now before this court and will be considered with the transcript of the proceedings in this delayed appeal.
At the original trial, in which appellant was represented by counsel, evidence was presented by the state which showed the burglary of a building occupied by the Meyer Food Store in the city of Granbury.
Appellant's written confession was introduced in evidence, without objection, in which he admitted having committed the burglary. Evidence was also adduced which showed that certain property stolen from the building was found in an automobile in which the appellant was riding on the night of the burglary. Proof was also made of the prior conviction alleged for purpose of enhancement.
The evidence is clearly sufficient to sustain the conviction.
Proof that a burglary was committed by someone, together with appellant's confession, was sufficient to sustain the conviction. Lyles v. State, 171 Tex. Crim. 468, 351 S.W.2d 886.
Also, proof that a burglary was committed and appellant's unexplained possession of property stolen from the building was sufficient to sustain the conviction. Edmonds v. State, Tex.Cr.App., 407 S.W.2d 783.
The failure to carry appellant before a magistrateof which complaint is made in his briefdid not vitiate the confession, which was made long before the enactment of Arts. 15.17, C.C.P., and 38.22, Vernon's Ann.C.C.P.
Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694, is not retroactive and has no application. Johnson v. State of New Jersey, 384 U.S. 719, 86 S. Ct. 1772, 16 L. Ed. 2d 882.
The judgment is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563915/ | 960 A.2d 320 (2008)
CAUDLE
v.
SECURITAS.
No. 07-AA-195.
District of Columbia Court of Appeals.
September 16, 2008.
Decision without published opinion. Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563889/ | 16 So. 3d 459 (2009)
SUCCESSION OF Robert Edward DUKE.
No. 44,377-CA.
Court of Appeal of Louisiana, Second Circuit.
July 1, 2009.
*461 Dunahoe Law Firm, by Jared Dunahoe, Natchitoches, for Appellant, Robert Duke, Jr.
Bethard & Bethard, L.L.P., by Robert Edgerton Bethard, Coushatta, for Appellants, Succession of Robert, Edward Duke and Helen Duke, Executrix.
Before BROWN, DREW and MOORE, JJ.
DREW, J.
Robert Duke, Sr. ("Senior") and Dorothy Duke married on October 25, 1945, in Louisiana. Robert Duke, Jr. ("Junior") was the only child born of the marriage. During their marriage and while domiciled in Louisiana, Senior and Dorothy acquired 380 acres of land located in Arkansas: 320 acres were acquired in 1955, and 60 acres were acquired in 1963.
Dorothy Duke died intestate on May 12, 2000. Senior received the La. C.C. art. 890 legal usufruct over his late wife's share of the community property. At the time of Dorothy's death, $290,143.72 in community funds were held in an account at Bank of Coushatta.
In a last will and testament executed on June 10, 2005, Senior named Helen Cole as his executrix and bequeathed all of his property to her. Senior married Helen Cole on June 24, 2005. Senior died on April 1, 2007.
In June of 2008, Junior filed separate petitions for declaratory judgment in Senior's succession. In the first petition, Junior alleged that he was the sole heir and administrator of Dorothy Duke's succession. He further alleged that upon the date of his father's remarriage, the legal usufruct terminated, and his father was required to deliver the property subject to the usufruct to him, along with legal interest on the funds from the date of termination of the usufruct.
In the second petition, Junior contended that the Arkansas property was community property. He prayed that he, as Dorothy Duke's heir, be recognized as the owner of a one-half interest in the property.
The trial court did not find in Junior's favor on his first petition. The court ruled that Junior was entitled to $145,071.86 plus the interest actually earned on the $145,071.86 while on deposit at the Bank of Coushatta from June 24, 2005, to July 23, 2008,[1] and then judicial interest from July 23, 2008, until paid.
In a separate judgment, the court ruled in favor of Junior on the petition for declaratory judgment regarding the Arkansas property. The court classified the property as community property on the basis of La. C.C. art. 3525, and ruled that Junior was entitled to one-half of the net proceeds from the sale of the Arkansas *462 property. The court denied a motion for new trial filed by Senior's succession.
Senior's succession and Junior have appealed. Senior's succession has filed an exception of no cause of action with this court. The succession argues that Junior was never placed in possession of Dorothy Duke's assets, and, therefore, had no cause of action to demand the payment of money from Senior's succession. The exception was referred to the merits of the appeal.
DISCUSSION
Exception of No Cause of Action
A peremptory exception of no cause of action questions whether the law extends a remedy to anyone under the factual allegations of the petition. Birdsong v. Hirsch Memorial Coliseum, 42,316 (La.App.2d Cir.8/22/07), 963 So. 2d 1095. The exception is triable on the face of the petition, and the facts pled are to be accepted as true. Industrial Companies, Inc. v. Durbin, XXXX-XXXX (La.1/28/03), 837 So. 2d 1207.
Junior alleged in the petitions that he was the administrator of his mother's succession. The law clearly recognizes a cause of action by an administrator for the return of succession assets. La. C.C.P. art. 3211 states, "A succession representative shall be deemed to have possession of all property of the succession and shall enforce all obligations in its favor." The exception of no cause of action filed by Senior's succession is without merit.
We note that the exception urged by Senior's succession may actually be an exception of no right of action. Senior's succession contended in its exception that Junior had never been placed into possession of any assets belonging to Dorothy Duke, and therefore had no cause of action to demand payment of any sums of money from Senior's succession. No memo was submitted in support of the exception. In the original brief filed by Senior's succession on this appeal, it is contended that until Junior is judicially recognized as Dorothy Duke's only heir, which Senior's succession does not dispute, he can make no demand on Senior's succession for any payment. Thus, as the argument goes, Junior would not be entitled to any interest on the funds until he is placed into possession of an ownership interest in the funds.
The exception of no right of action tests whether the plaintiff has a real and actual interest in the action. See, La. C.C.P. art. 927. The function of the exception of no right of action is to determine whether the plaintiff belongs to the class of persons to whom the law grants the cause of action asserted in the suit. Louisiana Paddlewheels v. Louisiana Riverboat Gaming Com'n, 94-2015 (La.11/30/94), 646 So. 2d 885. The no right of action exception assumes that the petition states a valid cause of action for some person and questions whether the plaintiff in the particular case has a legal interest in the subject matter of the litigation. Id.
Senior's succession admits in its brief that Dorothy Duke's succession was opened on July 12, 2007, and that Junior was appointed administrator. La. C.C.P. art. 685 provides that the succession representative appointed by a court of this state is the proper plaintiff to sue to enforce a right of the deceased or of his succession, while the latter is under administration. Thus, Junior is in the class of persons to whom the law grants the cause of action asserted in the suit. If the exception of no right of action is what Senior's succession intended to urge, it is also without merit.
Dorothy Duke's succession was apparently opened shortly after Junior filed the *463 declaratory judgments. However, any objection as to lack of Junior's procedural capacity has been waived. See, La. C.C.P. arts. 926(6) and 928.
Legal Interest
At the termination of a usufruct of consumables, the usufructuary is bound to deliver to the owner things of the same quantity and quality or the value they had at the commencement of the usufruct. La. C.C. art. 629. Money is a consumable. La. C.C. art. 536.
Junior argues on appeal that the trial court erred in not awarding legal interest on the sums held on account from the date that the usufruct ended, instead of just from the date of judicial demand. In support of his argument, Junior cites La. C.C. art.2000, which states, in part:
When the object of the performance is a sum of money, damages for delay in performance are measured by the interest on that sum from the time it is due, at the rate agreed by the parties or, in the absence of agreement, at the rate of legal interest as fixed by R.S. 9:3500.
Article 2000 appears in Section 4 ("Damages") of Chapter 8 ("Effects of Conventional Obligations") of Title IV ("Conventional Obligations or Contracts") of Book III of the Civil Code. An obligation can arise from a contract or other declaration of will; it can also arise directly from the law. La. C.C. art. 1757. The usufruct created by juridical act is called conventional; the usufruct created by operation of law is called legal. La. C.C. art. 544. Since the art. 890 usufruct arises by operation of law, it is a legal usufruct under art. 544. Comment (b) to art. 890.
There was never a contract or agreement between Junior, as heir and administrator, and Senior concerning the funds subject to the usufruct. The art. 890 usufruct did not create a conventional obligation between them. Therefore, relying on art.2000 in order to determine the interest owed from the date of remarriage until the date of judicial demand would be inappropriate. The trial court properly awarded the amount of interest actually earned by the funds from the date of termination of the usufruct until the date of judicial demand.
Conflict of Laws
Senior's succession appeals that part of the judgment classifying the Arkansas property as community property in accordance with Louisiana law. Louisiana's conflict of laws provisions relative to the ownership of marital property are found in La. C.C. arts. 3523 through 3527, which comprise Title III ("Marital Property") in Book IV ("Conflict of Laws") of the Civil Code.[2]
In reaching its conclusion, the trial court applied La. C.C. art. 3525, which provides:
Upon the termination of the community between spouses, either of whom is domiciled in this state, their rights and obligations with regard to immovables situated in another state acquired during marriage by either spouse while domiciled in this state, which would be community property if situated in this state, shall be determined in accordance with the law of this state. This provision may be enforced by a judgment recognizing the spouse's right to a portion of the immovable or its value.
The trial court erred in applying art. 3525. That article refers to the situation where one spouse, not both, acquired foreign property while domiciled in this state. *464 If the legislature had intended to include foreign property acquired in the names of both spouses within the article's scope, it would have used the plural "both spouses" instead of merely the singular, "either spouse." Our interpretation of the article is supported by comment (e) to the article, which states, in part, with emphasis added: "By essentially treating the foreign immovable as if it were community property, this Article adequately protects the non-owner spouse."
This court's interpretation is also supported by comment (a) to art. 3525, which reads, in part, with emphasis added:
Scope. This Article applies to immovables which: (1) are situated outside Louisiana; (2) would be classified as community property under Louisiana law (e.g., were acquired with funds classified as community funds under Louisiana law); and (3) were acquired by a spouse (a) who, at the time of the acquisition, was domiciled in Louisiana and (b) who, at the time of the termination of the community, was domiciled in Louisiana or was subject to the jurisdiction of its courts.
In an unpublished opinion,[3] the U.S. 5th Circuit concluded that art. 3525 applied only to acquisitions by either spouse, not both spouses. In re Provenza, 82 Fed. Appx. 101, 2003 WL 22477888 (5th Cir. 2003), cert. denied, Provenza v. Friend, 542 U.S. 919, 124 S. Ct. 2872, 159 L. Ed. 2d 775 (2004). This decision was heralded as correct because the factual circumstances of the case failed to meet one of the required elements of art. 3525, an acquisition by only one spouse. Spaht and Moreno, Matrimonial Regimes §§ 4.1 and 8.11, in 16 Louisiana Civil Law Treatise (3d ed.2007).
Because art. 3525 does not apply, this court must look elsewhere in Title III. Comment (a) to art. 3525 states in relevant part:
If any one of the above conditions [listed earlier in the comment] is missing, this Article does not apply and, depending on the circumstances, another article in this Title might be applicable. If no other article is directly applicable, the case may fall under Article 3523, supra, as the residual article of this Title, and, if that Article is not applicable, the court should resort to Article 3515, supra, the residual Article of this Book.
No other article in Title III is directly applicable, nor is the residual article, art. 3523, applicable. Therefore, we resort to art. 3515, the residual article of Book IV. Article 3515 states:
Except as otherwise provided in this Book, an issue in a case having contacts with other states is governed by the law of the state whose policies would be most seriously impaired if its law were not applied to that issue.
That state is determined by evaluating the strength and pertinence of the relevant policies of all involved states in the light of: (1) the relationship of each state to the parties and the dispute; and (2) the policies and needs of the interstate and international systems, including the policies of upholding the justified expectations of parties and of minimizing the adverse consequences that might follow from subjecting a party to the law of more than one state.
The parties were married in Louisiana, and were domiciled in Louisiana at the time the Arkansas property was acquired. *465 Dorothy and Senior were domiciled in Louisiana at the time of their deaths. Senior's last will and testament was executed in Louisiana. Although Senior was in the military and moved his family to several military bases, Senior and his family returned to Louisiana when he left the service. It appears that Arkansas's only relevant relationship to Senior and Dorothy was that the couple had purchased property there.
The significance of the community property regime in this state cannot be overemphasized. "There is nothing more fundamental in our law than the rule of property which declares that this community is a partnership in which the husband and wife own equal shares, their title thereto vesting at the very instant such property is acquired." Messersmith v. Messersmith, 229 La. 495, 507, 86 So. 2d 169, 173 (1956). Louisiana has an interest in maintaining the reach of the community property regime to all foreign property acquired with the community assets of couples domiciled in Louisiana.
Senior's succession points out that Arkansas is a "tenancy by the entirety" state. When a husband and wife acquire property located in Arkansas in both of their names, a presumption arises that the property is held in a tenancy by the entirety. See Ramsey v. Ramsey, 259 Ark. 16, 531 S.W.2d 28 (1975). Under this doctrine, when a married couple purchase property together, a spouse's half interest in the property is immediately transferred to the surviving spouse at the time of the first spouse's death.
Nevertheless, we note that Arkansas, in adopting the Uniform Disposition of Community Property Rights at Death Act ("Act"), AR-ST XX-XX-XXX et seq., has recognized the importance of protecting the interests of spouses who are domiciled in community property states. AR-ST XX-XX-XXX(2) states that the Act applies to:
All or the proportionate part of any real property situated in this state which was acquired with the rents, issues, or income of, the proceeds from, or in exchange for, property acquired as or which became, and remained, community property under the laws of another jurisdiction, or property traceable to that community property.
AR-ST XX-XX-XXX(1) provides that in determining whether the Act applies to specific property, the following rebuttable presumption applies:
Property acquired during marriage by a spouse of that marriage while domiciled in a jurisdiction under whose laws property could then be acquired as community property is presumed to have been acquired as or to have become, and remained, property to which this chapter applies[.]
Regarding the disposition of property upon death, the Act reads in AR-ST XX-XX-XXX:
Upon the death of a married person, one-half (½) of the property to which this chapter applies is the property of the surviving spouse and is not subject to testamentary disposition by the decedent or distribution under the laws of succession of this state. One-half (½) of that property is the property of the decedent and is subject to testamentary disposition or distribution under the laws of succession of this state. With respect to property to which this chapter applies, the one-half (½) of the property which is the property of the decedent is not subject to the surviving spouse's right to elect against the will and no estate of dower or curtesy exists in the property of the decedent.
*466 The trial court did not err in classifying the Arkansas property as community property under Louisiana law.
CONCLUSION
With each party to bear its own costs of this appeal, the judgment is AFFIRMED.
NOTES
[1] This date is apparently in error as the petition for declaratory judgment relative to the interest was filed on June 23, 2008.
[2] La. C.C. art. 14 states that except as otherwise expressly provided by Louisiana law, cases having contacts with other states are governed by the law selected in accordance with the provisions of Book IV.
[3] Fifth Circuit Rule 47.5.4 provides that an unpublished opinion issued after January 1, 1996, is not precedent, but may be cited. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563910/ | 75 F.2d 786 (1935)
KANSAS CITY SOUTHERN RY. CO. et al.
v.
COMMISSIONER OF INTERNAL REVENUE.
No. 10083.
Circuit Court of Appeals, Eighth Circuit.
February 14, 1935.
*787 Samuel W. Moore, of New York City (Frank H. Moore, of Kansas City, Mo., and Fred R. Angevine, of New York City, on the brief), for petitioners.
Morton K. Rothschild, Sp. Asst. to Atty. Gen. (Frank J. Wideman, Asst. Atty. Gen., and Sewall Key, Sp. Asst. to Atty. Gen., on the brief), for respondent.
Before GARDNER, SANBORN, and VAN VALKENBURGH, Circuit Judges.
SANBORN, Circuit Judge.
This is a petition to review an order of the Board of Tax Appeals redetermining deficiencies in income taxes of the petitioners for the calendar year 1920 and the calendar years 1922 to 1925, inclusive. (22 B. T. A. 949.) The petitioners are the Kansas City Southern Railway Company and its wholly owned subsidiaries, and will be referred to in this opinion as "the taxpayer."
The questions presented by the petition may be stated, briefly, as follows:
1. Should the taxpayer's deduction for maintenance expenses for the year 1920 be reduced in the amount of $429,821.89 on the ground that that amount was used by the taxpayer for the restoration of undermaintenance sustained during the period of federal control (December 31, 1917, to March 1, 1920) and was covered by a subsequent allowance made by the Director General on account of undermaintenance?
2. Should the taxpayer's deduction for expenses for the year 1920 be reduced by the sum of $250,968.75 because the materials and supplies which it had received from the Director General on March 1, 1920 (to replace similar materials and supplies turned over to him by it on December 31, 1917), were, when used up in 1920, charged to operating expenses at their cost to the Director General rather than at the cost to the taxpayer in 1917 of the materials and supplies for which they were substituted?
3. Should the amount of actual or of estimated accrued revenue for the month of December, 1920, be included in the taxable income for that year?
4. Should contributions to the firemen's and policemen's balls and the National Guard of Missouri be deducted from the taxpayer's income for the years 1922 to 1925, inclusive, as ordinary and necessary business expenses?
5. Did the Board of Tax Appeals err in denying the petitions of the taxpayer for a reopening of the proceedings and a determination of the sufficiency of the waiver of its right to appeal to the Board with respect to certain items of the deficiencies determined by the Commissioner, which waiver contained a consent to an assessment of $238,478.03 of the asserted deficiencies?
These questions will be discussed in their order under the following headings:
1. Restoration of undermaintenance.
2. Materials and supplies.
3. Overlapping item.
4. Contributions.
5. Reopening.
Restoration of Undermaintenance.
Section 234 (a) of the Revenue Act of 1918, c. 18, 40 Stat. 1057, 1077, authorized the taxpayer, in computing its taxable income, to deduct "all the ordinary and necessary expenses paid or incurred during the taxable year in carrying on any trade or business. * * *"
The Director General took over the property of the taxpayer on January 1, 1918, and operated the property until March 1, 1920, when it was turned back to the taxpayer. It sought from the Director General an allowance of $1,710,038 on account of undermaintenance sustained during the period of federal control. Of this amount, $553,408 was asked for undermaintenance of way and structures, and $1,156,630 for undermaintenance of equipment. In its final settlement with the Director General, $809,773.83 was credited to the taxpayer on account of undermaintenance of way and structures. No amount was allowed or credited on account of undermaintenance of equipment, and the Director General did not concede that there was any such undermaintenance. *788 From March 1, 1920, the time when its property was restored to it, to December 31, 1920, the taxpayer expended, on account of maintenance of way and structures, $2,535,786.12, and on account of maintenance of equipment, $3,494,811.24, or a total of $6,030,597.36, all of which was charged to maintenance expense on its books of account and deducted from its gross income in its tax return for the year 1920 as ordinary and necessary expenses.
The Commissioner disallowed the deductions so claimed to the extent of $809,773.83, the amount allowed to the taxpayer by the Director General on account of undermaintenance of way and structures. This was done upon the ground that to that extent the taxpayer had been reimbursed by the government for undermaintenance sustained during the period of federal control. Upon review, the Board of Tax Appeals found that the taxpayer, during the year 1920, had expended $429,821.89 for the restoration of undermaintenance sustained during the control period, for which it was entitled to reimbursement by the Director General, and was later reimbursed. The Board reduced the deduction as claimed by the taxpayer by that amount. The basis for the Board's conclusion was this: It found that the taxpayer's expenses for the maintenance of way and structures during 1920 were $216,295.54 less than normal, indicating that undermaintenance or deferred maintenance of way and structures was greater December 31, 1920, than it was on March 1, 1920; that the taxpayer expended for the maintenance of equipment $646,117.43 more than was normal; and that therefore the difference between the amount by which ways and structures were undermaintained and the amount by which equipment was overmaintained, or $429,821.89, was to be regarded as the amount by which undermaintenance sustained during the period of federal control was restored during the year 1920.
Since the findings of the Board and the evidence upon which they were based show that undermaintenance of way and structures was increased in 1920, instead of being restored, the taxpayer clearly expended nothing on that account for which it was reimbursed by the Director General, and all expenditures that were made for maintenance of way and structures during 1920 were from the funds of the taxpayer. The allowance made by the Director General was a reserve for the restoration of undermaintenance of way and structures, Commissioner v. Norfolk & Southern R. Co. (C. C. A. 4) 63 F.(2d) 304, 306; Southern Railway Co. v. Commissioner (C. C. A. 4) 74 F.(2d) 887 (opinion filed January 8, 1935), but there was no restoration during 1920, and the reserve remained intact at the end of the year. Had undermaintenance of equipment during federal control been conceded or proved, and had an allowance been made by the government on that account, there would be a foundation for the claim that to the extent of $646,117.43, the amount by which the equipment of the taxpayer was found to have been overmaintained in 1920, there had been a restoration of the undermaintenance of equipment sustained during the federal control period; but, since there was no evidence of undermaintenance of equipment during that period, and no allowance therefor, all sums expended by it on that account were its own funds.
Conceding, therefore, that the applicable rule is, as the government claims, namely, that the taxpayer "should not be allowed any deduction for the expense of restoring undermaintenance in the year in which the undermaintenance was restored, when the cost of restoring it is borne by the Director General," New York, C. & St. L. R. R. Co. v. Helvering, 63 Ohio App. D. C. 247, 71 F.(2d) 956, 959, it clearly appears that this taxpayer was entitled to the full deduction claimed, no undermaintenance having been restored in 1920 the expense of which was to be borne by the Director General or paid out of any allowance made by him. Tunnel R. R. of St. Louis v. Commissioner (C. C. A. 8) 61 F.(2d) 166, 170; Commissioner v. Norfolk Southern R. Co. (C. C. A. 4) 63 F. (2d) 304, supra; Chicago & N. W. Ry. Co. v. Commissioner (C. C. A. 7) 66 F.(2d) 61; New York, C. & St. L. R. R. Co. v. Helvering, supra; Southern Railway Co. v. Commissioner (C. C. A. 4) 74 F.(2d) 887, supra.
Materials and Supplies.
On December 31, 1917, the taxpayer turned over to the Director General certain materials and supplies carried on its books at a value of $1,170,102.92. On March 1, 1920, the Director General turned back to the taxpayer similar materials and supplies, equal in quantity, quality, and usefulness, which were carried on its books at March 1, 1920, values, which exceeded the values of the materials and supplies originally turned over by the taxpayer. The materials and supplies so received from the Director *789 General were used up by the taxpayer in 1920, and charged to expenses and betterments at the March 1, 1920, values. The Commissioner held that the cost of such supplies and materials so used up by the taxpayer in 1920 was the book value as of December 31, 1917, and disallowed deductions to the extent of the difference between the 1917 and the 1920 values, which is conceded to be $250,968.75. The Board sustained the Commissioner.
We are satisfied that the 1917 inventory value of the materials and supplies which were restored in kind on the termination of federal control determined the deduction the petitioner was entitled to take for the expenditure of the substituted items. The substitution was of things, and not of value. The using up of a $2 1920 government shovel, which had been substituted for a $1 1917 railway shovel, caused a deductible loss to the taxpayer of $1, not $2. On this point, see Terminal Railroad Association of St. Louis v. Commissioner, 17 B. T. A. 1135; Missouri Pac. R. R. Co. v. Commissioner, 22 B. T. A. 267; Norfolk Southern R. R. Co. v. Commissioner, 22 B. T. A. 302; Baltimore & Ohio Railroad Co. v. Commissioner, 30 B. T. A. 194.
Overlapping Item.
In December, 1920, the taxpayer underestimated its revenues for that month to the extent of $282,555.66. This underestimate was made in good faith following a long continued practice of estimating revenues, which, by their nature, could not be determined at the end of any one month with any degree of exactness. The amount by which the December, 1920, income was underestimated went into the taxpayer's 1921 income. The practice followed by the taxpayer had met with the approval of the Interstate Commerce Commission. It is plain that over a course of years no prejudice could result to the government in the matter of taxes from such a practice. Counsel for the respondent has conceded that the Board erred in requiring an allocation of the amount of the underestimate to income for the year 1920. Section 212 (b) of the Revenue Act of 1918 (40 Stat. 1064), and Article III of Regulations 62 seem to require this concession, since clearly the "overlapping items do not materially distort the income," and the policy of the taxpayer with respect to them has been consistent for some twenty-five years.
Contributions.
This question, we think, must be decided in favor of the respondent, under Old Mission Portland Cement Co. v. Helvering, 293 U.S. 289, 55 S. Ct. 158, 79 L. Ed. ____.
Reopening.
By section 274 (d) and (j) of the Revenue Act of 1926, c. 27, 44 Stat. 9, 55 (26 US CA §§ 1048b, 1053), a taxpayer who has appealed to the Board of Tax Appeals may waive the assessment and collection of the whole or any part of a deficiency determined against him by the Commissioner, and thus stop the running of interest upon so much of the deficiency as is affected by the waiver.
In December, 1927, the Commissioner mailed a deficiency letter to each of the petitioners showing proposed deficiencies aggregating $409,983.43. The petitioners decided to waive their right of appeal to the Board with respect to items aggregating $238,478.03, and to consent to the assessment of that portion of the total deficiencies determined against them by the Commissioner. In February, 1928, the Kansas City Southern Railway Company, on behalf of itself and its subsidiaries, the petitioners here, sent to the Commissioner a "waiver of right to file a petition with the United States Board of Tax Appeals." The waiver was dated February 25, 1928. It was executed by the Kansas City Southern Railway Company on behalf of itself and its affiliates (the petitioners), it described the items of deficiencies as to which no appeal would be taken to the Board, specified the total amount of such items, consented to their assessment, gave the reasons for executing the waiver in consolidated form, namely, that the companies had filed consolidated returns and had filed a consolidated appeal, and concluded with these words: "The said companies reserve the right to pay said $238,478.03 under protest, and to sue to recover the same."
The Commissioner received the waiver on February 28, 1928. The taxpayer received no intimation from the Commissioner that the waiver was insufficient in either form or substance, until after August 5, 1931, when, in response to a letter written by it, the acting Commissioner advised it that the form of waiver executed by the Kansas City Southern Railway Company did not meet the requirements of section 274 (d) of the Revenue Act of 1926 (26 USCA *790 § 1048b), because it was signed by "only one of the corporations involved," and that it was not possible for the Commissioner to determine the amount of the deficiency which should be assessed against any one of the corporations. After August 5, 1931, there followed correspondence between the taxpayer, the Commissioner and the General Counsel of the Bureau of Internal Revenue relative to the validity of the waiver. On July 15, 1933, the General Counsel advised the taxpayer by letter that the Commissioner's letter of August 5, 1931, relative to the insufficiency of the waiver was approved.
On September 29, 1932, the taxpayer paid to the Collector of Internal Revenue, at Kansas City, $220,441.56 to apply upon the deficiencies in taxes, exclusive of interest.
On August 1, 1933, the taxpayer petitioned the Board to reopen the proceedings to permit amendment of the pleadings and to receive evidence for the purpose of having the validity and effect of the waiver determined. The petition was denied August 8, 1933. Thereafter on October 17, 1933, the taxpayer again applied to the Board to reopen the proceedings for the purpose of enabling it to have a review of the refusal of the Commissioner to honor its waiver. This supplemental petition was denied December 9, 1933. The hearing before the Board had been held in March, 1930. The opinion of the Board was promulgated March 30, 1931, and before the taxpayer was advised by the Commissioner that its waiver would be disregarded. The order of redetermination was entered by the Board on January 31, 1934.
The reasons which the respondent now urges in justification of the Board's refusal to reopen the proceedings are: (1) That the taxpayer in the waiver inserted a reservation of the right to pay under protest and to sue to recover the tax; (2) that if the taxpayer intended to raise the question of the validity of the waiver, it should have amended its petition before or at the hearing; (3) that the taxpayer's remedy is a suit for a refund.
There is no suggestion that the Board was without jurisdiction to reopen the proceedings and to grant the taxpayer the review requested. No authority is cited by the respondent to sustain the proposition that if a taxpayer consents to the assessment of items of taxes not in dispute, but reserves the right to sue to recover the taxes paid, such reservation vitiates the consent. The taxpayer could hardly have been expected to raise the question of the validity of its waiver before it knew that the Commissioner would hold it invalid.
That the taxpayer may have a remedy in court for the recovery of the interest upon that part of the deficiency affected by its waiver would scarcely be an answer to the contention that the Board, in the exercise of a proper discretion, should have reopened the proceedings; and it is doubtful if the taxpayer, having appealed to the Board, has any such remedy. Warren Mfg. Co. v. Tait (D. C. D. Md.) 60 F.(2d) 982, 984; Old Colony Trust Co. v. Commissioner, 279 U.S. 716, 727, 49 S. Ct. 499, 73 L. Ed. 918.
It would be inappropriate for us to pass upon the question as to whether the waiver was valid or not, since that question has not been considered by the Board. That the question is an important and a debatable one is, we think, apparent. If the waiver is valid, as the taxpayer claims, then the taxpayer has been denied a review of the Commissioner's ruling, which compels it to pay some $70,000 of interest which it does not owe the government. If the waiver is invalid, the government will be in no way prejudiced by a determination to that effect, and the Board is only injured to the extent of the time and effort required to hear the testimony and to decide the question. It seems probable that all of the facts with respect to the waiver can be stipulated, so that the burden placed upon the Board should not be an excessive one.
In hearings before the Board, as in trials before the courts, justice ordinarily requires that all of the issues growing out of a particular controversy be disposed of upon their merits, whenever that can be done. If it appeared here that the failure to present to the Board the issue relative to the waiver was due to the negligence of the taxpayer or to its failure to act with reasonable promptness, we would think that the Board was clearly within its rights in refusing to reopen the proceedings. The taxpayer, however, could not have been expected to foresee that the Commissioner would treat its waiver as a nullity, and it was in no position to raise an issue which in fact did not exist at the time of the hearing before the Board.
So far as the action of the Commissioner is concerned, we think his silence with respect to the waiver for some three and a half years was without justification or excuse. *791 Common courtesy and ordinary regard for the rights of the taxpayer required that if either the form or substance of the waiver was not sufficient, it should have been notified to that effect. There could have been no doubt in the mind of the Commissioner, when he received the waiver, as to what the taxpayer was seeking to accomplish by sending it in. The deficiency letter which the Commissioner sent to the petitioners contained the following:
"If you acquiesce in this determination and do not desire to file a petition with the United States Board of Tax Appeals, you are requested to execute a waiver of your right to file a petition with the United States Board of Tax Appeals on the inclosed Form A, and forward it to the Commissioner of Internal Revenue, Washington, D. C., for the attention of IT:CR:RR-60D-TMM.
"In the event that you acquiesce in a part of the determination, the waiver should be executed with respect to the items to which you agree."
The taxpayer used the form referred to, with some modifications of its own.
It is true, as the respondent asserts, that the portion of the tax waived was not assessed against nor collected from the taxpayer. But the matter of assessment and collection was a matter which the taxpayer could not control, and it was not its duty to advise the Commissioner of his failure to act upon the waiver, or to assume that, because of that failure, he was going to hold that the waiver was invalid.
It is our conclusion that it would be in the interests of justice that the taxpayer have a hearing before the Board on the question of the sufficiency of the waiver. It has passed upon all the other aspects of the controversy over the tax liability of the taxpayer for the years in question, and should, we think, pass upon this one.
The language of the Supreme Court in Helvering v. Taylor, 55 S. Ct. 287, 291, 79 L. Ed. ____, opinion filed January 7, 1935, is appropriate: "The rule for which the Commissioner here contends is not consonant with the great remedial purposes of the legislation creating the Board of Tax Appeals."
We have concluded that the Board erred only with respect to the claimed restoration of undermaintenance, with respect to the overlapping item, and in its denial of the taxpayer's petition for the reopening of the proceedings for the purpose of securing a review of the question of the sufficiency of its waiver.
The case is remanded to the Board with directions to grant the petition of the taxpayer for a reopening of the proceedings, and to redetermine the taxpayer's deficiencies in income taxes in accordance with this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563930/ | 16 So. 3d 225 (2009)
Phillip SELLERS, Appellant,
v.
STATE of Florida, Appellee.
No. 5D08-3688.
District Court of Appeal of Florida, Fifth District.
August 14, 2009.
*226 James S. Purdy, Public Defender, and Noel A. Pelella, Assistant Public Defender, Daytona Beach, for Appellant.
Bill McCollum, Attorney General, Tallahassee, and Rebecca Rock McGuigan, Assistant Attorney General, Daytona Beach, for Appellee.
COHEN, J.
Phillip Sellers appeals the denial of his motion to dismiss and subsequent revocation of his probation. We reverse and remand for further findings.
After pleading guilty to numerous counts of possession of child pornography, Sellers was sentenced to three years in the Department of Corrections, followed by ten years' sex offender probation. Shortly after being released from prison, three probation officers searched his residence. Inside were hundreds of videotapes. From these, the probation officers randomly selected five; they also seized two books. Based on the content of these materials, an affidavit of violation of probation was filed which alleged Sellers owned, viewed, or possessed obscene, pornographic, or sexually stimulating visual or auditory material that was relevant to his deviant behavior pattern.
At the violation of probation hearing, the trial court viewed the materials and found that only three of the five videotapes contained sexually explicit material. Regarding the books, the trial court found one no different than "Madame Bovary," and the other contained "hardcore" images of a sexually explicit nature. It is undisputed that the materials seized only involved adults; none involved children. Nonetheless, the trial court specifically found that in a possession of child pornography case, possession of any pornography or sexually explicit material was relevant and material to Seller's deviant behavior pattern. Consequently, the trial court revoked Sellers' probation and sentenced him to fifteen years in the Department of Corrections, followed by fifteen years' probation.
Of the two arguments Sellers raises on appeal, we need only address his argument that the trial court erred in revoking his probation. Sellers contends there was "no evidence from which an association could be made between the underlying offenses of possession of child pornography and the sexually explicit materials in question," citing Kasischke v. State, 991 So. 2d 803, 815 (Fla.2008). Stated differently, Sellers contends his probation *227 could not be revoked absent some evidence linking the sexually explicit materials seized from his home to his deviant behavior of possessing child pornography.
The affidavit of violation of probation tracked section 948.03(5)(a)(7), Florida Statutes (2003), which prohibits viewing, owning, or possessing any obscene, pornographic, or sexually stimulating material that is relevant to the offender's deviant behavior pattern unless such possession is part of a treatment plan. Thus, section 948.03(5)(a)(7) does not prohibit a probationer from possessing any and all obscene, pornographic, or sexually stimulating materials, only those materials that are relevant to the charges for which he was placed on probation. The court in Kasischke provided little guidance in making this "relevancy" determination.
Whether pornographic, obscene, or sexually stimulating material is relevant to a sex offender's deviant behavior pattern will undoubtedly depend on the underlying facts and circumstances of the initial offense. In some cases, this determination will be relatively easy and straightforward.[1] However, in other cases, when the material is not clearly or closely related to the underlying offense, there must be evidence sufficiently linking the materials to the defendant's deviant behavior pattern. This will require the State to present evidence establishing a rational relationship between the pornographic, obscene, or sexually stimulating materials and the defendant's deviant behavior pattern. This may or may not require evidence in the form of expert testimony.[2]
On this record, we are unable to determine that the trial court's finding was supported by competent, substantial evidence. In making its determination of relevancy, the trial court did not make any findings describing the nature of the material, its content, and how it related or was relevant to, the defendant's deviant behavior pattern. The materials were not provided as part of the record.
Consequently, we remand to allow the trial court to provide a basis for this conclusion, specifying what evidence was relied upon and how that evidence was rationally related to Sellers' deviant behavior pattern.
REVERSED AND REMANDED FOR FURTHER PROCEEDINGS.
SAWAYA, J., and COBB, W., Senior Judge, concur.
NOTES
[1] Materials containing obscene, pornographic, or sexually stimulating images of children would clearly be relevant to Sellers' deviant behavior pattern.
[2] Sellers contends that because he was convicted of possession of child pornography, only materials that actually depict children in a sexually explicit manner will meet the Kasischke test. We disagree. Material that does not actually depict a child could still be relevant to deviant proclivities involving children if the material was sexually explicit and contained a puerile or adolescent theme. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563951/ | 960 A.2d 967 (2008)
KLEMENTS
v.
CECIL TOWNSHIP.
No. 577CD08.
Commonwealth Court of Pennsylvania.
October 22, 2008.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563976/ | 960 A.2d 320 (2008)
HARRIS
v.
U.S.
No. 04-CF-88.
District of Columbia Court of Appeals.
September 22, 2008.
Decision without published opinion. Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564384/ | 76 F.2d 851 (1935)
ST. LOUIS UNION TRUST CO. et al.
v.
BECKER, Collector of Internal Revenue.
No. 10078.
Circuit Court of Appeals, Eighth Circuit.
March 13, 1935.
Rehearing Denied April 19, 1935.
*852 Crawford Johnson, of St. Louis, Mo. (Rhodes E. Cave and Thomas S. McPheeters, both of St. Louis, Mo., Duryee, Zunino & Amen, of New York City, and Bryan, Williams, Cave & McPheeters, of St. Louis, Mo., on the brief), for appellants.
Morton K. Rothschild, Sp. Asst. to Atty. Gen. (Frank J. Wideman, Asst. Atty. Gen., Sewall Key and Carlton Fox, Sp. Assts. to Atty. Gen., and Harry C. Blanton, U. S. Atty., of Sikeston, Mo., and Herbert H. Freer, Asst. U. S. Atty., of St. Louis, Mo., on the brief), for appellee.
Before GARDNER, SANBORN, and VAN VALKENBURGH, Circuit Judges.
SANBORN, Circuit Judge.
This is an appeal from a judgment in favor of the appellee in an action at law brought by the appellants to recover $94,022.35 paid by them to the appellee under protest as estate taxes.
The facts, as to which there is virtually no dispute, are as follows:
William Evans Guy, on January 3, 1921, executed four separate written declarations of trust, one for each of his four children, who at that time had reached their majority. By each of the trust instruments he conveyed to himself, as trustee, certain securities of the par value of $72,000; the aggregate value of the securities at that time being $288,000. From time to time thereafter he made additions to these trusts, and at the time of his death on July 24, 1928, the total value of the trust property included in the four trusts was $994,195. This amount the Commissioner of Internal Revenue included as a part of the gross estate of the decedent, under Revenue Act of 1926, § 302 (26 U.S. C. § 1094 [26 USCA § 1094]), and the appellants, his executors, after paying the additional estate tax which resulted, brought this action to recover it.
The four declarations of trust were identical, with the exception of the name of the beneficiary. The declaration of trust for Evelyn S. Guy is typical of each of the trusts, and, so far as pertinent, is as follows:
"I, William Evans Guy, of the City of St. Louis, and State of Missouri, hereby declare, this third day of January, 1921, that I hold in trust for my daughter, Evelyn S. Guy, the following property, to-wit:" (Here follows description of securities); "with the powers and for the uses and purposes hereinafter set forth, as follows:
"1. I am to have the power at any time, and from time to time, to sell any of the *853 trust property or estate, for such price and prices as I may determine. Any money coming into my hands as the proceeds of any such sale or otherwise and forming a part of the principal of said trust estate shall as soon as practicable, be reinvested by me. In making such investments, I am to have full power to purchase any property, real or personal, which I may think desirable to acquire or hold as part of the said trust estate, and I am not to be restricted to the purchase of such property as is ordinarily deemed advisable for trust property. I am likewise to have the power to rent or lease any and all real estate which may be included in said trust property for terms of any duration, whether such terms shall extend to a time beyond the termination of this trust or not. I am likewise to have full power and authority in my discretion to borrow money and secure the sums so borrowed by pledge or mortgage of any and all portions of said trust estate and I may out of the corpus or income of said trust estate, or out of both such corpus and income repay the sums so borrowed. I am to have full authority to invest or reinvest any sums so borrowed; and to collect and receive the rents, income and profits arising from the trust estate therein created. It being my intention to retain as trustee (italics ours) such rights, power and authority in respect to the management, control and disposition of said trust estate for the use and benefit of the beneficiary, as I have with respect to property absolutely owned by me.
"2. Out of the income and revenue accruing from said trust estate I shall have power to pay all taxes, expenses necessarily or properly incident to its care, preservation and management; and all other reasonable or necessary charges incident to the administration of the trust created hereby, and out of the remaining income and revenue, I am to pay the beneficiary of this trust an allowance of $300.00 a month, with power in my discretion from time to time to increase or decrease the said allowance whenever I may deem it to be to the best interest of the said beneficiary, to have such allowance increased or decreased. I shall have the power, from time to time, out of the remainder of said income and revenue, to appropriate and pay such sums as I may deem reasonably necessary for the maintenance, support and education of said beneficiary. Any income not distributed as hereinabove provided shall be added to the principal of the trust estate.
"3. In case of an emergency, or illness of said beneficiary, requiring a greater sum than that accruing as income or revenue, I shall have power to use as much of the principal of said trust estate as may be absolutely necessary.
"4. Any receipt given by the beneficiary of this trust to me for any sum paid to her by me, shall be a full acquittance and discharge for the payment mentioned in such receipt.
"5. The foregoing provisions for my said daughter, Evelyn S. Guy, shall be for her sole and separate use, free from all statutory and marital rights of her husband; and free from her debts and without the right on her part to assign, pledge, hypothecate, or anticipate, or in any way create a lien upon any of the income or corpus of the trust estate hereby created before she shall receive the same, nor shall any of the said income or corpus be subject to any claims of any persons who may at any time be creditors of my said daughter.
"6. (a) If the said beneficiary should die before my death, then this trust estate shall thereupon revert to me and become mine immediately and absolutely, or (b) if I should die before her death, then this property shall thereupon become hers immediately and absolutely and be turned over to her and in either case this trust shall cease."
"[Signed] William Evans Guy.
"Witness: Wm. Edwin Guy."
In 1921, at the time these trusts were made, Mr. Guy was seventy-six years of age. Long prior to that time he had retired from the active management of any corporations in which he was interested, but he conducted his own affairs, which were extensive, and continued as a director of the St. Louis Cold Storage Company, the Laclede Steel Company, and as trustee and director in several syndicates. He maintained a downtown office, where he went every business day when the weather was good, from September to June, which was the portion of the year that he spent in St. Louis. He took an active interest in all matters with which he was connected. He made a practice of consulting his physician on an average of about once in six months, and enjoyed almost perfect health for a man of his years. He had not consulted his physician for some time prior to *854 the date of the execution of the trusts, so far as the physician could remember. In June, 1928, about two months prior to his death, he had had a physical examination, which disclosed no change in his condition. He was an optimistic and cheerful man, and exceptionally alert mentally. He came of a long-lived family, and frequently had made the statement that he expected to live to be at least ninety. It seems that two of his immediate ancestors had lived beyond that age. None of his friends knew of any ailment which might have led him to suspect that his death was to be expected in the near future. He was careful of his health, but obviously not concerned about death. In fact, the evidence indicates that he was, at the time these trusts were executed, in as good physical and mental condition as possible for any man of his years. His purpose in making the four trusts, as expressed to his son (who drafted the instruments) and to at least one of his friends, was to make his children independent of him, to enable them to know what they might expect each year, in lieu of an allowance out of his own income, and to avoid the high surtax which would be imposed upon his income if he retained his property for himself.
The action was tried to the court below without a jury. Two questions were presented:
(1) Was the transfer of the property included in these four trusts intended to take effect in possession or enjoyment at or after death?
(2) Were the transfers made in contemplation of death?
The court below found that none of the beneficiaries named in the trust instruments acquired custody, control, or title to the corpus of the trust prior to the death of the settlor; that the title of the beneficiaries was contingent upon their survival of the settlor; and that the motive for the creation of the trusts was to decrease the settlor's income taxes by distributing the property and thus avoiding the high rate for large incomes, and at the same time to make provision for the distribution of the property included in the trusts at the settlor's death. The court concluded that the corpus of the trusts was transferred in contemplation of death, that the transfers were intended to take effect in possession and enjoyment at and after death, and that the value of the trust property was therefore properly included in the gross estate.
It was the contention of the appellee, Collector of Internal Revenue, in the court below, and is his contention here, that the death of the settlor, rather than the trust instruments, constituted the generating source of title in the beneficiaries, since the final receipt and complete enjoyment of the trust property by them was contingent upon their surviving the settlor.
The pertinent provisions of the Revenue Act of 1926 are as follows:
Section 302, c. 27, 44 Stat. 9, 70 (26 U.S. C. § 1094 [26 USCA § 1094]). "The value of the gross estate of the decedent shall be determined by including the value at the time of his death of all property, real or personal, tangible or intangible, wherever situated * * *
"(c) To the extent of any interest therein of which the decedent has at any time made a transfer, by trust or otherwise, in contemplation of or intended to take effect in possession or enjoyment at or after his death, except in case of a bona fide sale for an adequate and full consideration in money or money's worth. Where within two years prior to his death but after the enactment of this Act [February 26, 1926], and without such a consideration the decedent has made a transfer or transfers, by trust or otherwise, of any of his property, or an interest therein, not admitted or shown to have been made in contemplation of or intended to take effect in possession or enjoyment at or after his death, and the value or aggregate value, at the time of such death, of the property or interest so transferred to any one person is in excess, of $5,000, then, to the extent of such excess, such transfer or transfers shall be deemed and held to have been made in contemplation of death within the meaning of this title [chapter]. Any transfer of a material part of his property in the nature of a final disposition or distribution thereof, made by the decedent within two years prior to his death but prior to the enactment of this Act [February 26, 1926], without such consideration, shall, unless shown to the contrary, be deemed to have been made in contemplation of death within the meaning of this title [chapter]. * * *"
In considering the question whether the transfer of the corpus of these trusts was intended to take effect in possession or enjoyment at or after death, it must be remembered *855 that the federal estate tax is a tax on the transfer of property from the dead to the living, and not a tax upon the privilege of the living to succeed to the property of the dead. It is a transfer tax and not a succession tax. Young Men's Christian Association of Columbus, Ohio et al. v. Davis et al., 264 U.S. 47, 50, 44 S. Ct. 291, 68 L. Ed. 558; Edwards v. Slocum et al., 264 U.S. 61, 62, 44 S. Ct. 293, 68 L. Ed. 564; Nichols v. Coolidge et al., Executors, 274 U.S. 531, 537, 541, 47 S. Ct. 710, 71 L. Ed. 1184, 52 A. L. R. 1081; Ithaca Trust Company, Executor & Trustee v. United States, 279 U.S. 151, 155, 49 S. Ct. 291, 73 L. Ed. 647; Reinecke v. Northern Trust Company, 278 U.S. 339, 347, 49 S. Ct. 123, 73 L. Ed. 410, 66 A. L. R. 397; May et al., Executors v. Heiner, 281 U.S. 238, 244, 50 S. Ct. 286, 74 L. Ed. 826, 67 A. L. R. 1244; Saltonstall et al. v. Saltonstall et al., 276 U.S. 260, 270, 48 S. Ct. 225, 72 L. Ed. 565; Chase National Bank et al. v. United States, 278 U.S. 327, 334, 49 S. Ct. 126, 73 L. Ed. 405, 63 A. L. R. 388.
With that principle in mind, the Supreme Court has construed many trust instruments and has held that those absolutely and irrevocably vesting the corpus in a beneficiary prior to the death of the settlor, and not made in contemplation of death, were not subject to the tax imposed by section 302 (c) of the Revenue Act of 1926, and the similar provisions of other Revenue Acts, even though the benefits derived thereunder upon the death of the settlor would have been taxable under laws imposing a succession or inheritance tax such as those in force in some of the states.
In Shukert et al., Executrices v. Allen, 273 U.S. 545, 47 S. Ct. 461, 71 L. Ed. 764, 49 A. L. R. 855, there was an attempt to impose an estate tax under section 402 (c) of the Revenue Act of 1918 (40 Stat. 1097). The property, the value of which was sought to be included in the gross estate, had been transferred by the testator on May 5, 1921, to a trust company to accumulate the income therefrom (subject to small deductions in case of extreme destitution of the testator's wife or of any of the beneficiaries named) until February 1, 1951, unless the last of the beneficiaries should have died more than twenty-one years before that date, and then to divide the principal and undistributed income among the three children of the testator. The question was whether the trust was one intended to take effect in possession or enjoyment after the testator's death. Mr. Justice Holmes, speaking for the court, said (pages 547, 548 of 273 U. S., 47 S. Ct. 461):
"The transfer was immediate and out and out, leaving no interest remaining in the testator. The trust in its terms has no reference to his death but is the same and unaffected whether he lives or dies. Although the Circuit Court of Appeals [6 F.(2d) 551] seems to have thought otherwise, the interest of the children respectively was vested as soon as the instrument was executed, even though it might have been divested as to any one of them in favor of his issue if any, or of the surviving beneficiaries, if he died before the termination of the trust. * * * There certainly is no transfer taking effect after his [the testator's] death to be taxed under section 401.
"It is not necessary to consider whether the petitioner goes too far in contending that section 402 (c) should be construed to refer only to transfers of property the possession or enjoyment of which does not pass from the grantor until his death. But it seems to us tolerably plain, that when the grantor parts with all his interest in the property to other persons in trust, with no thought of avoiding taxes, the fact that the income vested in the beneficiaries was to be accumulated for them instead of being handed to them to spend (italics ours), does not make the trust one intended to take effect in possession or enjoyment at or after the grantor's death."
In Nichols v. Coolidge et al., Executors, supra, 274 U.S. 531, 47 S. Ct. 710, 71 L. Ed. 1184, 52 A. L. R. 1081, the Supreme Court considered an attempt to tax, as part of an estate, property which had been conveyed in a trust instrument executed in 1907. The trust deed conveyed the property of Mr. and Mrs. Coolidge to trustees, to pay the income to the settlors, then to the survivor of them, and, after his or her death, to distribute the corpus to the settlors' five children. The trustees were authorized, among other things, to sell the trust property and to make and change investments. In 1917 the settlors assigned to their children their entire interest in the trust property, including the right to receive the income therefrom. Upon the death of the survivor of the settlors, a tax was assessed under section 402 (c) of the Revenue Act of 1918 (40 Stat. 1097), upon the trust property. The tax was paid *856 and an action was brought to recover it. Section 402 (c) was in substance the same as the section with which we are here concerned. The court, in holding that the tax was wrongfully assessed, said (pages 542, 543 of 274 U. S., 47 S. Ct. 710, 714): "And we must conclude that section 402 (c) of the statute here under consideration, in so far as it requires that there shall be included in the gross estate the value of property transferred by a decedent prior to its passage merely because the conveyance was intended to take effect in possession or enjoyment at or after his death, is arbitrary, capricious and amounts to confiscation."
In Reinecke v. Northern Trust Company, supra, 278 U.S. 339, 49 S. Ct. 123, 73 L. Ed. 410, 66 A. L. R. 397, the Supreme Court reviewed a decision of the Seventh Circuit affirming a judgment of the District Court, which had allowed recovery of taxes assessed and collected under section 402 (c) of the Revenue Act of 1921 (42 Stat. 278), which section is similar to section 302 (c) of the Revenue Act of 1926 (26 USCA § 1094 (c), here involved, except that it specifically provided that the tax was to be imposed whether the transfer or trust was made or created before or after the passage of the act. Five of the trusts involved in that case were made in 1919, and created life interests in income with remainders over. In one of the trusts the life interest was terminable five years after the death of the settlor, or on the death of the designated life beneficiary should she survive. In the others, life interests in the income were created, terminable five years after the settlor's death or on the death of the respective life tenants, whichever should happen first. The settlor reserved to himself power to supervise the reinvestment of trust funds, to require the trustee to execute proxies to his nominee, to control all leases executed by the trustee, and to appoint successor trustees. In these five trusts the power was reserved to "alter, change or modify the trust," which was to be exercised, in the case of four of them, by the settlor and a single beneficiary of each trust acting jointly, and, in the case of one of the trusts, by the settlor and a majority of the beneficiaries named, acting jointly. In determining that the rights of the beneficiaries in the five trusts were vested by the trust instrument, and that the trust property was not subject to the estate tax, Mr. Justice Stone, speaking for the court, said (pages 346, 347, 348 of 278 U. S., 49 S. Ct. 123, 125):
"If it be assumed that the power to modify the trust was broad enough to authorize disposition of the trust property among new beneficiaries or to revoke the trusts, still it was not one vested in the settlor alone, as were the reserved powers in the case of the two trusts. He could not effect any change in the beneficial interest in the trusts without the consent, in the case of four of the trusts, of the person entitled to that interest, and in the case of one trust without the consent of a majority of those so entitled. Since the power to revoke or alter was dependent on the consent of the one entitled to the beneficial, and consequently adverse, interest, the trust, for all practical purposes, had passed as completely from any control by decedent which might inure to his own benefit as if the gift had been absolute.
"Nor did the reserved powers of management of the trusts save to decedent any control over the economic benefits or the enjoyment of the property. He would equally have reserved all these powers and others had he made himself the trustee, but the transfer would not for that reason have been incomplete. (Italics ours.) The shifting of the economic interest in the trust property which was the subject of the tax was thus complete as soon as the trust was made. His power to recall the property and of control over it for his own benefit then ceased and as the trusts were not made in contemplation of death, the reserved powers do not serve to distinguish them from any other gift inter vivos not subject to the tax. (Italics ours.)
"But the question much pressed upon us remains whether, the donor having parted both with the possession and his entire beneficial interest in the property when the trust was created, the mere passing of possession or enjoyment of the trust fund from the life tenants to the remaindermen after the testator's death, as directed, and after the enactment of the statute, is included within its taxing provisions. * * *
"One may freely give his property to another by absolute gift without subjecting himself or his estate to a tax, but we are asked to say that this statute means that he may not make a gift inter vivos, equally absolute and complete, without subjecting it to a tax if the gift takes the form of a life estate in one with remainder over to another at or after the donor's death. It would require plain and compelling language to justify so incongruous a result *857 and we think it is wanting in the present statute. * * *
"In the light of the general purpose of the statute and the language of section 401 explicitly imposing the tax on net estates of decedents, we think it at least doubtful whether the trusts or interests in a trust intended to be reached by the phrase in section 402 (c) `to take effect in possession or enjoyment at or after his death,' include any others than those passing from the possession, enjoyment or control of the donor at his death and so taxable as transfers at death under section 401. That doubt must be resolved in favor of the taxpayer."
In May et al., Executors v. Heiner, supra, 281 U.S. 238, 243, 50 S. Ct. 286, 287, 74 L. Ed. 826, 67 A. L. R. 1244, the court considered whether Mrs. May's estate was liable for estate taxes on property conveyed by her in 1917 to trustees, to pay the income to her husband for life, then to Mrs. May during her lifetime, with remainder to her four children. The taxes were imposed under section 402 (c) of the 1918 Act (40 Stat. 1097). The Supreme Court held that whether Mrs. May predeceased her husband was of no consequence, since "at the death of Mrs. May no interest in the property held under the trust deed passed from her to the living; title thereto had been definitely fixed by the trust deed. The interest therein which she possessed immediately prior to her death was obliterated by that event." The court held that the executors were entitled to a refund of the tax.
Coolidge et al., Trustees v. Long, Commissioner of Corporations & Taxation of Massachusetts, 282 U.S. 582, 51 S. Ct. 306, 75 L. Ed. 562, involved a trust deed which had previously been considered by the court in Nichols v. Coolidge et al., supra, 274 U.S. 531, 47 S. Ct. 710, 71 L. Ed. 1184, 52 A. L. R. 1081. By this trust deed a large amount of property had been transferred from the settlors to trustees. Income from the trust was to be paid to the settlors during their lives, according to the proportion in which each contributed to the trust, and the entire income was to go to the survivor, and upon his or her death the principal was to be divided equally among the five sons of the settlors. It was provided that if any of the sons predeceased the survivor of the settlors, his share should go to those entitled to take under the statutes of distribution in force at the time of the death of the survivor. No power of revocation, modification, or termination of the trust existed prior to the death of the survivor of the settlors. All of the five sons eventually survived the settlors, one of whom died in January, 1921, and the other on November 10, 1925. Excise taxes were assessed under the Massachusetts statute, effective subsequent to January 1, 1921, which provided that: "All property within the jurisdiction of the commonwealth * * * which shall pass by * * * deed, grant or gift, except in cases of a bona fide purchase for full consideration in money or money's worth * * * made or intended to take effect in possession or enjoyment after his [grantor's] death * * * to any person, absolutely or in trust, * * * shall be subject to a tax. * * *" G. L. Mass. c. 65, § 1. This statute was made applicable only to property or interests passing or accruing upon the death of persons dying on or after May 4, 1920. The Massachusetts Supreme Court had sustained the exaction of the tax upon the theory that the possession or enjoyment upon the death of the survivor of the settlors was taxable under the statute enacted after the creation of the trust. The Supreme Court said (pages 597, 598 of 282 U. S., 51 S. Ct. 306, 309): "By the deed of each grantor one-fifth of the remainder was immediately vested in each of the sons, subject to be divested only by his death before the death of the survivor of the settlors. It was a grant in præsenti, to be possessed and enjoyed by the sons upon the death of such survivor. * * * The provision for the payment of income to the settlors during their lives did not operate to postpone the vesting in the sons of the right of possession or enjoyment. The settlors divested themselves of all control over the principal; they had no power to revoke or modify the trust. Coolidge v. Loring, supra, 235 Mass. 220, 223, 126 N.E. 276. Upon the happening of the event specified without more, the trustees were bound to hand over the property to the beneficiaries. Neither the death of Mrs. Coolidge nor of her husband was a generating source of any right in the remaindermen. Knowlton v. Moore, 178 U.S. 41, 56, 20 S. Ct. 747, 44 L. Ed. 969. Nothing moved from her or him or from the estates of either when she or he died. There was no transmission then. The rights of the remaindermen, including possession and enjoyment upon the termination of the trusts, were derived solely from the deeds. The situation would have been precisely the same if the pos- *858 sibility of divestment had been made to cease upon the death of a third person instead of upon the death of the survivor of the settlors." (Italics ours.)
On page 599 of 282 U. S., 51 S. Ct. 306, 310, the opinion continues: "No act of Congress has been held by this court to impose a tax upon possession and enjoyment, the right to which had fully vested prior to the enactment."
And on pages 605 and 606 of 282 U. S., 51 S. Ct. 306, 312, the court says in conclusion: "We conclude that the succession was complete when the trust deeds of Mr. and Mrs. Coolidge took effect, and that the enforcement of the statute imposing the excise in question would be repugnant to the contract clause of the Constitution and the due process clause of the Fourteenth Amendment. * * *"
Mr. Justice Roberts, in an opinion concurred in by Mr. Justice Holmes, Mr. Justice Brandeis, and Mr. Justice Stone, dissented upon the ground that the Massachusetts statute sought to tax the privilege to succeed and enjoy, rather than the privilege to transfer, and that such privilege of succession was not fully exercised until after the death of the surviving settlor, when the taxing statute was in force. On page 631 of 282 U. S., 51 S. Ct. 306, 322, the following language is found in the dissenting opinion: "Of course the test to be applied in cases arising under the federal estate tax law is whether the transferor has parted with every vestige of control over the beneficial enjoyment and possession of the property, and not whether the beneficiary has received it. Nichols v. Coolidge (274 U.S. 531 [47 S. Ct. 710, 71 L. Ed. 1184, 52 A. L. R. 1081]) dealt, under the federal estate tax law, with the same trust involved in this case, and the inquiry there necessarily was whether prior to the passage of the estate tax act the grantors had so fully divested themselves of all right of control and enjoyment of the property that nothing remained to pass out of them at death. The facts were held to make an affirmative answer imperative. Here, on the other hand, we inquire, not whether the grantor has parted with title, control and enjoyment, but whether the grantee has fully acquired them prior to the passage of the law."
The case of Burnet v. Northern Trust Co., Executor, 283 U.S. 782, 51 S. Ct. 342, 75 L. Ed. 1412, involved a tax imposed under section 402 (c) of the Revenue Act of 1921 (42 Stat. 278). The trust deed there involved provided that the trustee should pay the entire net income to the settlor for life; that after her death the trustee was to pay such income equally to her four children for life; that, upon the death of a child leaving lawful issue, the share of such child should be paid to his or her lawful issue per stirpes until the period of distribution. The distribution date was fixed. The Circuit Court of Appeals for the Seventh Circuit (41 F.(2d) 732) held that the transfer was not taxable, notwithstanding the income was payable to the settlor for life; and the Supreme Court affirmed that decision on the authority of May v. Heiner, supra, in a per curiam opinion.
Morsman, Administrator v. Burnet, 283 U.S. 783, 51 S. Ct. 343, 75 L. Ed. 1412, involved a tax imposed under section 302 (c) of the 1924 Revenue Act, 26 USCA § 1094 note (which is, in substance, the same as the section here under consideration). The Supreme Court, in a per curiam opinion, based on May v. Heiner, supra, reversed a decision of this court (44 F.(2d) 902) which held that the value of a trust estate set up by the decedent in 1922 was properly included in the gross estate where the settlor had reserved the income therefrom to himself for life.
McCormick et al., Executors v. Burnet, 283 U.S. 784, 51 S. Ct. 343, 75 L. Ed. 1413, involved a tax imposed under section 402 (c) of the Revenue Act of 1921 (42 Stat. 278). A decision of the Seventh Circuit [43 F.(2d) 277] that a transfer under a trust agreement executed in 1918, providing for its termination upon the election of the settlor and one of the three beneficiaries, and for the reversion of the trust estate to the settlor if she survived the beneficiaries, was taxable as a transfer intended to take effect in possession or enjoyment at or after death, was reversed on the authority of May v. Heiner, supra.
In Burnet v. Guggenheim, 288 U.S. 280, 53 S. Ct. 369, 77 L. Ed. 748, it was held that revocable deeds of trust made in 1917 became taxable as gifts in 1925, when the power of revocation was canceled, because that was the time when there was a change of economic benefits.
In Helvering v. Duke et al., 290 U.S. 591, 54 S. Ct. 95, 78 L. Ed. 521, the Supreme Court affirmed, without opinion, upon an equal division of the court (Mr. Chief Justice Hughes having taken no part) a decision *859 of the United States Circuit Court of Appeals for the Third Circuit [62 F.(2d) 1057] holding transfers of property conveyed in two trusts not taxable as intended to take effect in possession or enjoyment at or after death, within section 302 (c) of the 1924 Act (26 USCA § 1094 note). In both of these trusts the settlor in 1917 conveyed to himself as trustee, for the benefit of his minor daughter and her descendants, the personal property described in the trust instruments. The instruments also provided for successor trustees. The settlor reserved no power to alter or revoke, and the trust property was to revert to him only in the event that the beneficiary died prior to his death. The settlor, as trustee, had full power to manage the trust property. Provision was made for the termination of the trusts after the settlor's death, and the transfer of parts of the corpus of the trust to the beneficiary as she reached certain ages. The settlor died in 1925. The Board of Tax Appeals, in its decision (23 B. T. A. 1104), which was affirmed by the Third Circuit [62 F.(2d) 1057] held that the trust agreements were the generating sources of title, and that nothing passed from the settlor at death, notwithstanding that he held the property himself as trustee and that there was a possibility during his lifetime of a reversion of the fee to him in case the beneficiary should predecease him.
Klein v. United States, 283 U.S. 231, 51 S. Ct. 398, 75 L. Ed. 996, upon which the appellee strongly relies, dealt with a transfer by deed, in which the grantor had conveyed a life estate in real property to his wife, expressly reserving to himself the fee, which was to "remain vested in said grantor" in the event that the grantee "shall die prior to the decease of said grantor," but was to pass to the grantee if she survived him. In holding that the transfer was taxable under section 402 (c) of the Revenue Act of 1918 (40 Stat. 1097), as a transfer intended to take effect in possession or enjoyment at or after death of the grantor, the court said (page 234 of 283 U. S., 51 S. Ct. 398, 399): "It is perfectly plain that the death of the grantor was the indispensable and intended event which brought the larger estate into being for the grantee and effected its transmission from the dead to the living, thus satisfying the terms of the taxing act and justifying the tax imposed."
The appellee is of the opinion that the case with which we are concerned falls within the rule of the Klein Case, upon the theory that Mr. Guy transferred to himself, as trustee, only a life interest in the corpus of each of the four trusts, for the purpose of providing income for his children, and that the provisions in the trust instruments that the beneficiaries should take the property only in the event they survived the settlor, had the effect of preventing the passage of title to them until the death of the settlor. This same contention was made in the case of Helvering v. St. Louis Union Trust Company et al. (C. C. A. 8) 75 F.(2d) 416, 418, opinion filed January 17, 1935. We said in that case: "Had the decedent in the case at bar retained the legal title to all of the trust property, and had he provided that, upon his death, and not before, such title should pass to his daughter or to others or to a trustee for her or their benefit, the situation would be comparable to that in the Klein Case; but here the decedent parted with the legal title to the trust property and to all beneficial interest therein during the life of the trust, and did so irrevocably. It was only in the case of the happening of certain contingencies over which he had no control that the property would revert to him. One of these contingencies was the death of his daughter prior to his death, while the trust still continued; and the second was a termination by the trustee of the trust during the lifetime of the grantor. Neither of these contingencies occurred, and there was, during the decedent's lifetime, nothing more than a possibility that either would occur. In no proper sense was there an enlargement of the interests of the beneficiaries of the trust resulting from the death of the decedent. That event merely changed the possibility that the property would revert to him into an impossibility. The distinction between the Klein Case and this case, as we see it, is that in the former the legal title was retained by the grantor and passed to the grantee with the grantor's death, while here the grantor parted with the title and all beneficial interest in the property, and retained no right with respect thereto that would pass to anyone as the result of his death. In the Klein Case death was the generating source of title, while in this case the trust instrument was the source of title, and death merely destroyed a possibility that the trust property might revert to the grantor."
It will be noted that in Reinecke v. Northern Trust Co., supra, 278 U.S. 339, pages 347, 348, 49 S. Ct. 123, 125, 73 L. *860 Ed. 410, 66 A. L. R. 397, the opinion in which was written by Mr. Justice Stone, it was said: "One may freely give his property to another by absolute gift without subjecting himself or his estate to a tax, but we are asked to say that this statute means that he may not make a gift inter vivos, equally absolute and complete, without subjecting it to a tax if the gift takes the form of a life estate in one with remainder over to another at or after the donor's death."
Hence, decisions relating to gifts inter vivos, even though such gifts are not in the form of trusts, are pertinent.
In Edson v. Lucas (C. C. A. 8) 40 F.(2d) 398, it appeared that Mrs. Edson had given to her daughter, Mrs. Pratt, certain stocks, with provision that, if Mrs. Edson or her husband survived Mrs. Pratt, the securities should revert. It was sought to tax a gain which resulted from the sale of the stock transferred to Mrs. Pratt, as income of Mrs. Edson. We held that, notwithstanding the provision that the stock was to revert to Mrs. Edson in case of Mrs. Pratt's death, the gift was complete; and in that connection said (page 405 of 40 F.(2d): "It is safe to say that, where there is a complete transfer of the legal title to the subject-matter of the gift, together with some equitable or beneficial present interest, to the donee, without power of revocation in the donor, coupled with the intentional delivery of complete possession, dominion and control over the gift, the gift is not invalid because of conditions imposed by the donor which are not inconsistent with the immediate vesting of such legal title in the donee."
We referred in that case to People's Trust Co. v. Dickson, 126 Misc. 580, 214 N. Y. S. 73, which held that a provision that a gift should be subject to defeasance by the death of the donee before that of the donor would not defeat the gift. It appeared, however, in that case that the donor had transferred merely the possession of 90 shares of Bethlehem Steel common stock, assigned in blank, to his wife, on condition that she hold the stock until after his death, and that it should then become her personal property. It was held that this negatived any intent to make an immediate gift of this stock. The Dickson Case, we think, is analogous to the Klein Case, where Mrs. Klein received, in effect, the possession and enjoyment of real estate, the title to which remained in her husband during his lifetime and passed to her only upon his death. On the other hand, the case of Edson v. Lucas is, in our opinion, analogous to the case at bar, as is also the case of Flint v. Ruthrauff, 26 A.D. 624, 53 N. Y. S. 206, affirmed 163 N.Y. 588, 57 N.E. 1109. There it appeared that a gift of certain bonds was made by Miss Flint to Miss Ruthrauff, with the understanding or qualification that Miss Flint should have some of the income therefrom and that the gift should be entirely defeated in case Miss Ruthrauff's death occurred before the death of Miss Flint. It was held that the gift was a valid one, notwithstanding the provision for defeasance.
We are advised by the opinion of Mr. Justice Stone in the case of Reinecke v. Northern Trust Co., supra, that the fact that a settlor makes himself a trustee under the trust instrument with the power of management of the trust, would not make the transfer incomplete. We are advised by the opinion of Mr. Justice Holmes, in the case of Shukert v. Allen, supra, 273 U.S. 545, 47 S. Ct. 461, 71 L. Ed. 764, 49 A. L. R. 855, that the fact that income of a trust is to be accumulated for the benefit of the beneficiaries therein named, instead of being handed to them to spend, does not make the trust one intended to take effect in possession or enjoyment at or after the grantor's death. We are advised by the dissenting opinion of Mr. Justice Roberts in Coolidge et al., Trustees v. Long, Commissioner of Corporations & Taxation of Massachusetts, supra, 282 U.S. 582, 631, 51 S. Ct. 306, 322, 75 L. Ed. 562, concurred in by three other justices and in no way disputed by the majority opinion, that "the test to be applied in cases arising under the federal estate tax law is whether the transferor has parted with every vestige of control over the beneficial enjoyment and possession of the property, and not whether the beneficiary has received it." Under the circumstances, we cannot hold that the fact that Mr. Guy made himself a trustee with power to manage the trust property or that he reserved the right to control the amount of income which should be paid to the beneficiaries during the continuance of the trust, or that the beneficiaries were to receive the trust property at his death, prevented the transfer from becoming complete at the time the trust instruments were executed.
It seems, then, that the question as to whether the transfer was one to take effect in possession or enjoyment at or after Mr. *861 Guy's death depends entirely upon whether by the trust instruments he, as an individual, parted with every vestige of control over the beneficial enjoyment and possession of the property conveyed. In order to sustain the conclusion of the lower court that he, as an individual, retained some vestige of control over the beneficial enjoyment and possession of the trust property until his death, we would be obliged to point out what it was that he retained. It is clear that the legal title to the trust property passed from him upon the execution of the trust instruments. The possession of the trust property which he had formerly held as an individual he thereafter held as a trustee. The income from the trust property was no longer his. He was obliged either to pay the income over to the beneficiaries or to accumulate it for them. The powers with which he clothed himself as trustee were not to be exercised by him for his own benefit, but only for the benefit of those for whom he had constituted himself trustee. The only interest, then, which he retained was the right to have the trust property revert to him in case the beneficiaries should predecease him. That right to the reversion was not an interest which passed to the beneficiaries as the result of Mr. Guy's death. It was merely an interest which was obliterated by his death. It passed not to the living, but entirely out of existence. So far as we can discern, the rights of the beneficiaries to the trust property were complete at the time the declarations of trust were executed. Thereafter, Mr. Guy as an individual had no interest in the property then or thereafter held by him as trustee, except the right to a reversion on certain conditions over which he had no control. Hence, nothing could have passed from him to the beneficiaries of the trust at the time of his death, although that event, by virtue of the terms of the declarations of trust, gave them the rights with respect to his property which the declarations of trust provided they should have if they survived him.
It is true, as the appellee says, that: "Taxation is not so much concerned with the refinements of title as it is with the actual command over the property taxed the actual benefit for which the tax is paid." Burnet v. Guggenheim, 288 U.S. 280, 283, 53 S. Ct. 369, 77 L. Ed. 748; Corliss v. Bowers, 281 U.S. 376, 378, 50 S. Ct. 336, 74 L. Ed. 916. However, in the case of estate taxes, the actual benefit for which the tax is paid must be a benefit which passes from the dead to the living, and where a complete transfer is made prior to death, the transferor certainly retains no "actual benefit" justifying the imposition of the tax.
The appellee also contends that the cases which we have referred to can be distinguished from the case at bar on the ground that the transfers in those cases were intended to take effect in possession or enjoyment after death, whereas here they were intended to take effect in possession or enjoyment at death. The statute, however, deals with transfers intended to take effect in possession or enjoyment "at or after" death. This precludes the drawing of any distinctions between trusts which terminate at death and those which terminate after death, where the transfers are complete and irrevocable during the life of the settlor.
We reach the conclusion, therefore, that the property transferred under these declarations of trust was not a part of the estate of Mr. Guy at the time of his death, unless the transfers were made in contemplation of death.
The appellee's theory is that the actual transfer of the corpus of these trusts to the beneficiaries was accomplished by the death of the settlor, and that any motive he may have had in transferring the property to himself as trustee, to distribute the income to his children, is disconnected with the ultimate transfer, which was subject to the presumption that it was made in contemplation of death, under section 302 (c), Revenue Act 1926 (26 USCA § 1094 (c). Since we have held that the transfer was complete at the time of the execution of the trust instruments, more than seven years prior to the death of the settlor, that theory is, of course, untenable, and the statutory presumption respecting transfers made within two years prior to death is not applicable.
Whether a transfer is made in contemplation of death must obviously be determined from the facts of each particular case.
In Milliken et al., Executors, v. United States, 283 U.S. 15, page 23, 51 S. Ct. 324, 327, 75 L. Ed. 809, the court said, with reference to gifts made in contemplation of death: "It is sufficient for present purposes that such gifts are motivated by the same considerations as lead to testamentary dispositions *862 of property, and made as substitutes for such dispositions without awaiting death, when transfers by will or inheritance become effective. Underlying the present statute is the policy of taxing such gifts equally with testamentary dispositions, for which they may be substituted, and the prevention of the evasion of estate taxes by gifts made before, but in contemplation of, death. It is thus an enactment in aid of, and an integral part of, the legislative scheme of taxation of transfers at death."
In United States v. Wells et al., Executors, 283 U.S. 102, 51 S. Ct. 446, 75 L. Ed. 867, the Supreme Court affirmed a decision of the Court of Claims, 39 F.(2d) 998, 69 Ct. Cl. 485, holding that certain gifts were not made in contemplation of death. The gifts were to the decedent's wife and children at dates ranging from approximately seven months to almost two years prior to his decease. The evidence showed that, during this period, the decedent was undergoing medical treatment, but was in a fair state of health and had no reason to expect death in the near future. In the opinion by Mr. Chief Justice Hughes, the following language is used (pages 117, 118, 119, of 283 U. S., 51 S. Ct. 446, 451):
"Death must be `contemplated' that is, the motive which induces the transfer must be of the sort which leads to testamentary disposition. As a condition of body and mind that naturally gives rise to the feeling that death is near, that the donor is about to reach the moment of inevitable surrender of ownership, is most likely to prompt such a disposition to those who are deemed to be the proper objects of his bounty, the evidence of the existence or nonexistence of such a condition at the time of the gift is obviously of great importance in determining whether it is made in contemplation of death. * * *
"As the test, despite varying circumstances, is always to be found in motive, it cannot be said that the determinative motive is lacking merely because of the absence of a consciousness that death is imminent. It is contemplation of death, not necessarily contemplation of imminent death, to which the statute refers. It is conceivable that the idea of death may possess the mind so as to furnish a controlling motive for the disposition of property, although death is not thought to be close at hand. Old age may give premonitions and promptings independent of mortal disease. Yet age in itself cannot be regarded as furnishing a decisive test, for sound health and purposes associated with life, rather than with death, may motivate the transfer. The words `in contemplation of death' mean that the thought of death is the impelling cause of the transfer, and while the belief in the imminence of death may afford convincing evidence, the statute is not to be limited, and its purpose thwarted, by a rule of construction which in place of contemplation of death makes the final criterion to be an apprehension that death is `near at hand.'
"If it is the thought of death, as a controlling motive prompting the disposition of property, that affords the test, it follows that the statute does not embrace gifts inter vivos which spring from a different motive. * * * The purposes which may be served by gifts are of great variety. It is common knowledge that a frequent inducement is not only the desire to be relieved of responsibilities, but to have children, or others who may be the appropriate objects of the donor's bounty, independently established with competencies of their own, without being compelled to await the death of the donor and without particular consideration of that event. There may be the desire to recognize special needs or exigencies or to discharge moral obligations. The gratification of such desires may be a more compelling motive than any thought of death.
"It is apparent that there can be no precise delimitation of the transactions embraced within the conception of transfers in `contemplation of death,' as there can be none in relation to fraud, undue influence, due process of law, or other familiar legal concepts which are applicable to many varying circumstances. There is no escape from the necessity of carefully scrutinizing the circumstances of each case to detect the dominant motive of the donor in the light of his bodily and mental condition, and thus to give effect to the manifest purpose of the statute."
In Willcuts v. Stoltze (C. C. A. 8) 73 F.(2d) 868, Judge Booth has carefully reviewed many cases dealing with the subject. That case held that a finding that gifts made to the testator's son, for the declared purpose of reducing the testator's income taxes and giving the son a real working interest in the testator's business, and gifts to the testator's wife's sister soon after *863 the wife's death, pursuant to a formerly expressed desire to make the sister a gift, were not made in contemplation of death within section 302 (c) of the Revenue Act of 1926, was justified by the evidence.
In the case of Flannery v. Willcuts (C. C. A. 8) 25 F.(2d) 951, this court set aside a finding of the lower court that transfers in trust made by Mrs. James J. Hill shortly prior to her death were made in contemplation of death, on the ground that there was no substantial evidence to sustain such finding, although Mrs. Hill was, at the time the transfers were made, well advanced in years and not in good health.
According to the evidence, Mr. Guy, in making these trusts, was actuated by two motives: (1) To make his children independent; (2) to avoid high surtaxes upon his income. Both of these motives were intimately associated with life. United States v. Wells et al., Executors, supra, 283 U.S. 102, 51 S. Ct. 446, 75 L. Ed. 867; Willcuts v. Stoltze (C. C. A.) supra, 73 F.(2d) 868. Evidence that Mr. Guy was in any way influenced in what he did by the thought of death is entirely lacking:
The suggestion of the appellee, that the determination by the Commissioner that the transfers were made in contemplation of death would support the lower court's finding to that effect, is obviously unsound. Any presumption as to the correctness of the Commissioner's determination is a rebuttable one and would only support such a finding in the absence of any substantial evidence to the contrary. Willcuts v. Stoltze (C. C. A.) supra, 73 F.(2d) 868, 872; Flannery v. Willcuts (C. C. A. 8) supra, 25 F.(2d) 951; Brown et al. v. Commissioner (C. C. A. 10) 74 F.(2d) 281; Lippincott et al. v. Commissioner (C. C. A. 3) 72 F.(2d) 788. Our conclusion that there is no substantial evidence that Mr. Guy made these transfers in contemplation of death finds strong support in the two recent cases last cited.
Because of the feeling of uncertainty occasioned by the equal division of the justices of the Supreme Court in Helvering v. Duke, supra, we have in this opinion reviewed and quoted from the authorities at far greater length than would otherwise be justified. We must, of course, follow the applicable law as it has thus far been established. If there are to be modifications or changes in the law relative to the taxation of such transfers as are here involved, this court is not the proper tribunal to make them.
The judgment is reversed and the case remanded for further proceedings not inconsistent with this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2340386/ | 263 P.3d 222 (2011)
STATE
v.
FLINT.
No. 101583.
Court of Appeals of Kansas.
November 10, 2011.
Decision Without Published Opinion
Reversed and remanded with directions. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2454248/ | 251 P.3d 73 (2011)
STATE
v.
FIGUEROA.
No. 104010.
Supreme Court of Kansas.
April 29, 2011.
Decision Without Published Opinion
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563984/ | 16 So. 3d 828 (2009)
CITIGROUP GLOBAL MARKETS REALTY CORP.
v.
REVUELTA.
No. 3D08-3205.
District Court of Appeal of Florida, Third District.
September 4, 2009.
Decision without published opinion Vol. dismissed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563991/ | 616 S.W.2d 587 (1981)
STATE of Missouri ex rel. Carol Jane Morris ROBINSON, Plaintiff,
v.
The Honorable James Clifford CROUCH, Judge of the Circuit Court of Christian County, Missouri, Defendant.
No. 12003.
Missouri Court of Appeals, Southern District, Division One.
May 12, 1981.
*589 Meredith B. Turner and Lynn E. Heitman, Turner, Reid, Duncan & Loomer, Springfield, for plaintiff.
K. Thomas Tough and Wayne C. Smith, Jr., Springfield, for defendant.
TITUS, Judge.
Plaintiff Carol petitioned this court to prohibit the defendant circuit judge from enforcing his rulings which would require plaintiff to produce certain documents and answer certain interrogatories regarding her earnings, assets, etc., in an action instituted by her former husband, Gary, designed to modify a previously made dissolution of marriage decree.[1] The gist of plaintiff's claim for prohibition is that defendant has no jurisdiction in the cause to modify the decree and hence no jurisdiction to make or enforce the discovery rulings. Our preliminary order in prohibition issued and the parties have filed their briefs. The paramount issue herein is whether the written and duly executed "Child Custody, Property Division and Maintenance Agreement"[2] (hereinafter agreement or contract) made by Carol and Gary in contemplation of the dissolution and the action of the dissolution court in respect thereto, precluded modification of the specified monthly maintenance payments to be made by Gary to Carol.
At the outset it should be especially noted that Gary seeks only to affect or modify that portion of the contract and decree relating to his liability for payments to Carol for support and maintenance. From this and the lack of action on or concerning other aspects of the agreement during the five years since the contract was made and the decree entered, we may reasonably assume that all other mutual contractual duties contained in the agreement have been satisfactorily discharged by the performance thereof and that such performance lends validity to at least those parts of the contract which have been duly executed and not questioned. Brandt v. Beebe, 332 S.W.2d 463, 467[7] (Mo.App.1959); II Restatement of the Law of Contracts, § 386, pp. 728-729. In filing his "First Amended Petition for Modification and Correction of Decree," Gary abandoned the allegations of his original pleading [Lightfoot v. Jennings, 363 Mo. 878, 880, 254 S.W.2d 596, 597[3] (1953)], and all the circuit court had before it was, in fine, a motion to modify its original decree. The amended petition averred modification was due because changed circumstances of the parties rendered the original decree unreasonable "within the meaning of [§] 452.370-1" and because the separation contract did not preclude modification as "provided for in [§] 452.325-6." The sole relief sought was to reduce Gary's obligation to pay Carol for her support and maintenance "to the sum of $1.00 per year." Modification, according to the pleading, was justified because Carol's "earning capacity and earnings and income other than earned income are sufficient to support her without contribution from" Gary and because Gary's remarriage has subjected him to "expenses not contemplated at the time of the dissolution of marriage."
In contemplation of and conditioned upon the entry of an order dissolving their 18-year marriage, Carol and Gary executed an elaborate six page written separation contract. Inter alia, the agreement contained detailed provisions for the division of all assets in which either or both had or claimed any interest; for the assumption and discharge of liabilities; for the custody, *590 support and visitation of their only child; for Gary's monthly maintenance payments to Carol; et cetera. One of the stated purposes for making the contract was to adjust the parties' property rights and Carol's "right to support and maintenance in the event [of] a dissolution." Among other things, the agreement stated: "1. INCORPORATION: This agreement may be incorporated in, and made a part of any dissolution decree which may hereafter be granted.... 3. EFFECTIVE DATE: This agreement shall become binding upon the parties ... immediately following the granting of a decree of dissolution, provided that the provisions of this agreement are approved by the Court in which such proceeding is instituted.... 9. MAINTENANCE: [Gary] agrees to pay [Carol] for her support and maintenance, the sum of [$1,650] per month, starting July 1, 1975,.... Beginning July 1, 1979, such monthly payments shall be reduced to [$1,500]. The liability of [Gary] for these payments shall cease [upon the death of either party or upon Carol's remarriage]. 10. ACCEPTANCE BY WIFE: [Carol] acknowledges that the provisions of this agreement for her support and maintenance are fair, adequate, and satisfactory to her, and in keeping with her accustomed standard of living and her reasonable requirements. [Carol], therefore, accepts these provisions in full and final settlement and satisfaction of all claims and demands for alimony or for any other provision for support and maintenance, and fully discharges [Gary] from all such claims and demands except as provided in this Agreement.... 13. ENTIRE AGREEMENT: This Agreement contains the entire understanding of the parties, and there are no representations, warranties, covenants, or undertakings other than those expressly set forth herein. 14. MODIFICATION AND WAIVER: A modification or waiver of any of the provisions of this agreement shall be effective only if made in writing and executed with the same formality of this agreement."
At the hearing conducted on the dissolution petition, Gary acknowledged that the contract, supra, represented "a fair and equitable division of property and provisions for the support of [his] wife." In § 452.325-2, it is provided that "[i]n a proceeding for dissolution of marriage ..., the terms of the separation agreement ... are binding upon the court unless it finds, after considering the economic circumstances of the parties and other relevant evidence produced by the parties, on their own motion or on request of the court, that the separation agreement is unconscionable." When ordering the decree of dissolution the court specifically found: "Property settlement filed, and the Court finding it fair, reasonable, and not unconscionable, approved same." As specifically provided in paragraph 1 of the contract, supra, and § 452.325-4(1), the separation agreement was incorporated into and made a part of the decree as admitted in defendant's (actually Gary's) brief herein. To be additionally observed is that the contract precluded or limited modification of its terms (§ 452.325-6) by stating in paragraph 14 that modification thereof could be effected "only if made in writing and executed with the same formality of this agreement." Moreover, and predicated on the foregoing and the fact the maintenance contract was incorporated into and not expressly excluded from the dissolution decree, the agreement provisions anent maintenance became decretal and therefore "enforceable by all remedies available for the enforcement of a judgment." § 452.325-5. In re Marriage of Haggard, 585 S.W.2d 480, 482[2] (Mo. banc 1979). This holds no succor for Gary. By formally finding the separation agreement "fair, reasonable, and not unconscionable," the court lent its judicial approval to the plain language of the contract and, by incorporating its terms into the decree as specifically provided in the agreement, reduced to judgment the fact that the agreed-to maintenance due Carol could not be modified except by mutual assent of the parties. Nakao v. Nakao, 602 S.W.2d 223, 226[1] (Mo.App.1980).
Although the foregoing indicates little or no dispute to be resolved, Gary's lone point relied on states: "The award of maintenance *591 to [Carol] is subject to modification by reason of the fact that the agreement and it's [sic] terms were not reviewed by the court with determinations as required by V.A.M.S. § 452.325(1) and (2); V.A.M.S. § 452.330[-1] (2) and (3); and V.A.M.S. § 452.335, 1(1), (2) and 2(1); thus the court has failed to exhaust it's [sic] jurisdiction, which failure, upon proper notice, may be modified, vacated or corrected as to any part of the decree entered." Wherein and why the terms of the contract were not reviewed with determinations required by the cited statutes and wherein and why such failure resulted in the nonexhaustion of the court's jurisdiction is not shown or understandable from the point as written. The argument portion of the brief, no more intelligible than the point, explains "that the trial court has done nothing more than become a rubber stamp for the agreement entered into by the parties [and] when the trial court does so, the jurisdiction of the trial court has not been exhausted." What we suspect is being claimed is that the dissolution court, although ordinarily bound by the terms of the separation agreement (§ 452.325-2), failed to make a sua sponte in-depth inquiry as to the fiscal circumstances of the parties and other related matters before declaring the contract not unconscionable.
The main fault we find with Gary's present position and assertions is that the action he instituted did not, either directly or collaterally, attack the legality or conscionability of the separation agreement in regard to his liability for payments to Carol for support and maintenance. In the action actually filed, the basic concern is the authority of the trial court to proceed upon the petition-motion to modify and to enforce discovery procedures relating solely to that authority. The action instituted by Gary is neither a direct nor a collateral attempt to have the separation contract, or any part thereof, declared unconscionable. He nowhere pleaded, suggested or contended in his petition-motion that he did not enter into the separation agreement of his own free will and volition. Gary could have legally questioned the provisions of the separation contract by either not signing it, or, when presented to the trial court for approval and incorporation in the dissolution decree, by telling the court it was unconscionable, or by timely appealing from the decree. The fact Gary did none of this and made no effort to have the contract declared unconscionable in the petition-motion filed five years after the decree, implies the complaints raised for the first time in this court in this action for prohibition are simply afterthoughts designed to somehow foster an unpleaded right to modify the contract belatedly. If, assuming arguendo, the trial court in the separation action committed any error of law in approving the contract and incorporating it into the decree, the error was invited and encouraged by Gary when he signed it and assured the court under oath that it represented a fair and equitable division of property and provisions for the support of Carol. Errors of law do not provide grounds for collaterally attacking a final judgment, especially when raised for the first time in this court in opposing a writ of prohibition. Flanary v. Rowlett, 612 S.W.2d 47, 50[6] (Mo.App. 1981). Gary's reliance herein on Block v. Block, 593 S.W.2d 584 (Mo.App.1979) is misplaced. In that action the wife directly appealed the judgment of the circuit court finding the purported settlement agreement conscionable. Unlike the contract in the instant case, the agreement in Block did "not disclose even fragmentary information as to the economic circumstances of the parties" and on appeal the court held that the trial court's finding that the contract was not unconscionable "may not be supported without any evidence of the economic circumstances of the parties." But all the foregoing be as it may, the fact remains that the conscionability of the property settlement agreement was not raised in the basic action instituted by Gary and the return made in this prohibition proceeding may not be employed to broaden the issues set up in the petition or to bring additional issues into the case. State ex rel. Specialty Foam Products, Inc. v. Keet, 579 S.W.2d 650, 653[2] (Mo.App.1979).
*592 When Carol and Gary executed the contract to settle all marital property rights, including Carol's right to support and maintenance, and it was thereafter judicially declared conscionable, was court-approved and made a part of the decree as agreed, the maintenance contract became nonmodifiable except by mutual written assent of the parties. Gary's subsequent attempt to have the maintenance portion of the decree court-modified because of alleged changes in circumstances did not state a cause of action. Nakao v. Nakao, supra, 602 S.W.2d at 227. Jurisdiction of the court to render a particular judgment in a particular case depends upon the power of the court granted by statute or otherwise and cannot be waived. If a court cannot try a question except under particular conditions or unless petitioned in a particular way, it has no jurisdiction until such conditions exist or unless the court is approached in a manner which bestows jurisdiction. State ex rel. Lambert v. Flynn, 348 Mo. 525, 532, 154 S.W.2d 52, 57[8] (banc 1941); 21 C.J.S. Courts § 85, at pp. 128-129.
We are not completely circumscribed by the prayer of plaintiff's petition in prohibition, the essential object of which was to prohibit the defendant judge from enforcing the discovery rulings. Prohibition is the proper remedy to review a trial court's order improperly requiring discovery. State ex rel. Naes v. Hart, 548 S.W.2d 870, 873[1] (Mo.App.1977); State ex rel. Danforth v. Riley, 499 S.W.2d 40, 42[1] (Mo.App.1973). However, as we have additionally found that Gary's amended petition does not state a cause of action for modification of the contract, our preliminary rule in prohibition will be made absolute by which defendant judge will be prohibited from taking any further action in the cause, when returned to him, except to dismiss it for the reasons herein stated unless Gary first, upon being granted proper leave in additional proceedings, files an amended pleading correctly alleging facts entitling him to relief. Cf. State ex rel. Boll v. Weinstein, 365 Mo. 1179, 1186, 295 S.W.2d 62, 67-68[16-17] (banc 1956). It is so ordered.
GREENE, P. J., and FLANIGAN, J., concur.
NOTES
[1] Designation of parties herein as "plaintiff" and "defendant" is per Rules 84.22-84.26 and 97.01-97.02 albeit the litigants employ the customary titles of "relator" and "respondent." References to rules and statutes are to V.A. M.R. and V.A.M.S.
[2] Made a part of plaintiff's petition for writ of prohibition. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564017/ | 616 S.W.2d 439 (1981)
William DEVINE, Appellant,
v.
Steve DUREE, Appellee.
No. 18510.
Court of Civil Appeals of Texas, Fort Worth.
May 7, 1981.
Rehearing Denied June 4, 1981.
*440 Pettigrew, Wagner & Pettigrew and Forrest W. Wagner, Grand Prairie, for appellant.
Frank R. Jelinek, Arlington, for appellee.
OPINION
HUGHES, Justice.
William Devine has appealed, by writ of error, the default judgment rendered against him in a law suit instituted by Steve Duree who sought damages arising from his alleged reliance upon certain representations made to him by Devine. (American Metroplex Life Insurance Company, which has not appealed, was also sued for having been unjustly enriched in the transaction.) Substituted service of process pursuant to Tex.R.Civ.P. 106 (1978) was had upon Devine. Neither defendant filed an answer in the trial court nor participated in any way in the trial below.
We reverse and remand Duree's judgment against Devine.
Devine's first contention is that the trial court's rendition of default judgment against him was erroneous because the service of process had upon him was insufficient to subject him to the in personam jurisdiction of the trial court.
In order for Devine to succeed by way of writ of error the lack of the trial court's jurisdiction must appear on the face of the record. McKanna v. Edgar, 388 S.W.2d 927 (Tex.1965). Default judgments attacked on the ground that there was an invalid substituted service of process will be upheld only if the record affirmatively shows strict compliance with Rule 106. Crook v. Teitler, 584 S.W.2d 356 (Tex.Civ. App.Tyler 1979, no writ); Light v. Verrips, 580 S.W.2d 157 (Tex.Civ.App.Houston [1st Dist.] 1979, no writ).
Rule 106 provides:
"Unless it otherwise directs, the citation shall be served by
"(a) the officer delivering to each defendant, in person, a true copy of the citation with the date of delivery endorsed thereon and with a copy of the petition attached thereto, or
"(b) the officer's mailing by registered or certified mail, with delivery restricted to addressee only, a true copy of the citation and with a copy of the petition attached thereto.
"Where it is impractical to secure service, as authorized by (a) or (b) as above directed, the court, upon motion, may authorize service
"...
*441 "(d) by the officer delivering same to anyone over sixteen years of age at the party's usual place of abode, ...."
The thrust of Rule 106 is discussed in Harrison v. Dallas Court Reporting College, Inc., 589 S.W.2d 813, 815 (Tex.Civ.App. Dallas 1979, no writ):
"[T]he supreme court has directed that citation shall be personally delivered by the officer under section (a) or shall be served by registered or certified mail under section (b). Both of these preferred modes of service are considered personal service. Plaintiff need not attempt both before procuring substituted service under Rule 106(c) but he must establish that both preferred methods are impractical before substituted service is authorized. Substituted service is only authorized where personal service cannot be obtained." (Citation omitted.)
The affidavit attached to Duree's "Motion for Substituted Service Under Rule 106" recites:
"(I) was instructed to attempt service on William Devine at 1622 Parkway Lane Tarrant County, Texas and made the following listed efforts to serve said Citation to no avail: I made several attempts there & only an elderly lady (his wife I found out) states he doesn't live there. I checked the office & the manager says he lives there & pays rent on 1622 & 1624. "Return for rule 106 to serve anyone over 16 yrs of age there."
The motion for substituted service was granted and substituted service was had upon Minola Devine at 1622 Parkway in Arlington.
There is no evidence in the record that the deputy sheriff attempted to serve Devine at 1624 Parkway Lane. Reasonable diligence to personally serve Devine at 1624 Parkway Lane should have been demonstrated before substituted service was ordered. Sgitcovich v. Sgitcovich, 150 Tex. 398, 241 S.W.2d 142, 147 (1951); Nichols v. Wheeler, 304 S.W.2d 229 (Tex.Civ.App. Austin 1957, writ ref'd n.r.e.). We hold that the record does not sufficiently demonstrate that personal service upon Devine was impractical. "[T]he Rules of Civil Procedure with respect to service of citation are mandatory and a failure to comply with them renders any attempted service void." Harrison v. Dallas Court Reporting College, Inc., supra at 816.
The sustaining of Devine's jurisdictional point renders discussion of his other points of error unnecessary. There having been no in personam jurisdiction acquired over Devine we reverse the default judgment rendered against him and remand the cause to the trial court.
Reversed and remanded. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1563998/ | 960 A.2d 517 (2008)
James V. POPPLE and Victoria Popple
v.
LUZERNE COUNTY TAX CLAIM BUREAU and Lawrence Lee and Victoria Evstafieva.
Appeal of Lawrence Lee and Victoria Evstafieva.
No. 2224 C.D. 1007
Commonwealth Court of Pennsylvania.
Argued September 10, 2008.
Decided November 12, 2008.
*518 Jonathan S. Comitz, Wilkes-Barre, for appellants.
*519 Francis J. Hoegen, Wilkes-Barre, for appellees, James V. Popple and Victoria Popple.
Neil T. O'Donnell, Wilkes-Barre, for appellee, Luzerne County Tax Claim Bureau.
BEFORE: SMITH-RIBNER, Judge, and PELLEGRINI, Judge, and McCLOSKEY, Senior Judge.
OPINION BY Judge SMITH-RIBNER.
Lawrence Lee and Victoria Evstafieva (Purchasers) appeal from an order of the Court of Common Pleas of Luzerne County that granted the petition to set aside tax sale filed by James V. Popple and Victoria Popple, brother and sister (Popples), for property located in the Borough of Laurel Run (Property) that the Purchasers purchased in December 2003. The Purchasers question whether the Popples had actual notice of the pending tax sale and whether the trial court erred as a matter of law by considering matters that were not raised in the petition.
The trial court stated in its order of November 9, 2007 that it reviewed the briefs and supplemental briefs of the parties and considered the testimony and evidence offered at the hearing on October 25, 2007 (where only Victoria Popple and a county tax worker testified). The trial court granted the Popples' petition to set aside based upon failure of the Luzerne County Tax Claim Bureau (Bureau) to post the property prior to sale in accordance with Section 602(e)(3) of the Real Estate Tax Sale Law (Tax Sale Law), Act of July 7, 1947, P.L. 1368, as amended, 72 P.S. § 5860.602(e)(3). The trial court ordered that the sale be vacated and that the Bureau refund the purchase price paid by the Purchasers within thirty days.[1]
The record is undisputed that the Property was exposed to tax sale on December 3, 2003 and that the Purchasers purchased it. The Popples filed their petition to set aside on September 10, 2007, nearly four years after the tax sale. As indicated by the copies of public records submitted by the Purchasers at the trial court hearing as Exhibits 1 through 4 to the supplemental opposition brief, at least four other properties owned by the Popples were the subject of tax sale proceedings.
Section 602 of the Tax Sale Law, 72 P.S. § 5860.602, provides for several forms of notice to an owner as means of protecting against deprivation of property without due process. Section 602(a) requires notice at least thirty days before any scheduled sale in at least two newspapers of general circulation setting forth the purpose, time, place and terms of the sale and description of the property. There is no dispute regarding publication notice. Section 602(e) provides for mailed notice and for posting:
(e) In addition to such publications, similar notice of the sale shall also be given by the bureau as follows:
(1) At least thirty (30) days before the date of the sale, by United States certified mail, restricted delivery, return receipt requested, postage prepaid, to each owner as defined by this act.
(2) If return receipt is not received from each owner pursuant to the provisions of clause (1), then, at least ten (10) days before the date of the sale, similar notice of the sale shall be given to each owner who failed to acknowledge the *520 first notice by United States first class mail, proof of mailing, at his last known post office address by virtue of the knowledge and information possessed by the bureau, by the tax collector for the taxing district making the return and by the county office responsible for assessments and revisions of taxes. It shall be the duty of the bureau to determine the last post office address known to said collector and county assessment office.
(3) Each property scheduled for sale shall be posted at least ten (10) days prior to the sale.
The petition to set aside alleged that the Popples were not "personally served" with the required certified mail notice in violation of Section 602(e)(1). They contended that the certified mail notices were sent to an address other than their residences and that the notices were executed by someone else. The certified mail notices were sent to Bel-Air Yards, P.O. Box 126, Duryea, Pennsylvania 18642 (Bel-Air address). The Purchasers presented a copy of the deed for the Property to the Popples as grantees, which lists care of the Bel-Air address as the precise address of the grantees in the recording of the deed on November 17, 1997 in the Luzerne County Deed Book 2620, Pages 167, 192. Answer and New Matter of Respondents, Ex. B; Reproduced Record (R.R.) 24a, 31a. The return receipt for the certified mail bears a signature of "Joseph Popple" and is checked "Agent." Petition to Set Aside Tax Sale, Ex. A; R.R. 8a.
The certified mail notices for the four other tax sales to both James V. Popple and Victoria Popple also were sent to the Bel-Air address and were signed by "Joseph Popple" as "Agent." R.R. 89a, 101a, 125a and 140a. The Purchasers presented evidence that Popple Brothers Coal Company, which the Popples own, is registered at the Bel-Air address; an entity known as Popple Realty, Inc. is registered at that address; and James V. and Victoria Popple are officers in Popple Realty, Inc. and use the Bel-Air address for their individual addresses. R.R. 150a.
The Purchasers first argue that the Popples had actual notice of the pending tax sale. They quote Stanford-Gale v. Tax Claim Bureau of Susquehanna County, 816 A.2d 1214, 1217 (Pa.Cmwlth.2003), where this Court stated: "[A]ctual notice of a pending tax sale waives strict compliance with statutory notice requirements, and technical deficiencies in those notice requirements do not invalidate a tax sale." In Stanford-Gale owners of property were killed in a car crash, and their daughter and another relative were appointed as co-administrators of the estate. Applying Pennsylvania precedent treating co-administrators as one person, the Court concluded that actual notice to one of them was full notice to the estate. Further, such notice cured the defect in procedure when notices addressed to the decedents were returned as signed by someone else, namely, one of the administrators, and the tax claim bureau made no other efforts to locate the owners. The Purchasers also submit that notice to the Popples was imputed through Joseph Popple. Victoria Popple testified that he was a distant relative who had worked for her father but who had retired and that she never gave Joseph Popple authority to sign for certified mail to the Bel-Air address. The record clearly shows, however, that the Post Office permitted Joseph Popple to sign for certified mail at that address, with restricted delivery for James V. and Victoria Popple, many times.
The Purchasers maintain that the Popples had the same type of notice as the owner in Sabbeth v. Tax Claim Bureau of Fulton County, 714 A.2d 514 (Pa.Cmwlth. 1998), where an employee of the property *521 owner's husband's company signed for a certified mail notice to the owner and then placed it on her desk, as was customary. The owner claimed that she first read the notice fifty-three days later, on the date of the sale. The Court discussed "actual notice" as follows:
Actual notice has been defined as notice expressly and actually given, and brought home to the party directly. The term "actual notice," however, is generally given a wider meaning as embracing two classes, express and implied; the former includes all knowledge of a degree above that which depends upon collateral inference, or which imposes upon the party the further duty of inquiry; the latter imputes knowledge to the party because he is shown to be conscious of having the means of knowledge. In this sense actual notice is such notice as is positively proved to have been given to a party directly and personally, or such as he is presumed to have received personally because the evidence within his knowledge was sufficient to put him upon inquiry.
Id., 714 A.2d at 517 (quoting Black's Law Dictionary 1061-1062 (6th ed.1990)). The Court reversed the trial court's grant of the petition to set aside in Sabbeth, concluding that the owner had implied actual notice. The Purchasers here note Victoria Popple's concession on cross-examination that her attorney sent a letter to the Bureau on January 9, 2004 and that the tax sale notice might have prompted her to go to the county mapping department. She testified initially that she first learned of the tax sale in August or September 2006 while visiting the department.
The Purchasers' second contention is that the trial court erred as a matter of law in considering matters not raised in the Popples' petition to set aside. The petition challenged only the certified mail notice. At the hearing the Popples changed course and focused on the admission by the County that the Property was not posted, and the trial court pointed to failure to post as its reason for sustaining the petition to set aside.[2] The Purchasers assert that the underlying petition is equitable in nature, and they cite several older cases relating to actions in equity for the principle that an equitable action must conform to the case made out by the pleadings. See Modern Baking Co. v. Orringer, 271 Pa. 152, 114 A. 264 (1921).
The Popples do not address this point. The Bureau (which is now aligned with the Popples) argues, however, that although the petition to set aside did not raise the issue of posting, the Purchasers' brief in opposition to the petition acknowledged the notice requirements, including posting. At the hearing the Bureau's Sales Coordinator, Nadine Price, testified that posting is one of the three required forms of notice and that she had examined the Bureau's file and found that it did not contain documents indicating posting. Finally, counsel for the Popples argued to the trial court that posting was defective, so the tax sale should be set aside. In In re Tax Sale of Real Property in Paint Township, 865 A.2d 1009, 1013 n. 6 (Pa. Cmwlth.2005), the Court stated: "A general averment of the Bureau's failure to comply with statutory notice provisions is sufficient to preserve the issue of a deficiency *522 in a posting of a property with a tax sale notice." The Court thus concludes that the trial court did not err in considering the question of posting.
The Popples first emphasize cases stating that all three types of notice under Section 602 of the Tax Sale Law are required for the tax sale to be valid; if any is defective the sale is void. In re Upset Price Tax Sale, 150 Pa.Cmwlth. 191, 615 A.2d 870 (1992). Although the Popples mis-cite and misquote certain language, they rely upon In re Middlecreek Township Tax Sale No. 12434, 688 A.2d 1239 (Pa.Cmwlth.1997), a case where there was a stipulation that property was not posted before the tax sale but the trial court held that the sale was valid because the owners received actual notice, and this Court reversed. The Court noted that the word "shall" in Section 602(e)(3) had been held to be mandatory and stated further: "Moreover, we do not believe that this court's holding in Casaday [v. Clearfield County Tax Claim Bureau, 156 Pa. Cmwlth. 317, 627 A.2d 257 (1993)] may be read to excuse the failure of a tax bureau to comply with the mandatory posting requirement of section 602." Middlecreek Township Tax Sale, 688 A.2d at 1241. To guard against the deprivation of property without due process of law, "there must be strict compliance with the notice provisions of section 602." Id.
On the issue of posting, the Popples note that the burden to show compliance with all statutory notice provisions lies with the Bureau. See Ban v. Tax Claim Bureau of Washington County, 698 A.2d 1386 (Pa. Cmwlth.1997). The Bureau cites Tax Sale of Real Property in Paint Township and Middlecreek Township Tax Sale for the proposition that an owner's actual knowledge does not excuse failure to post. Price testified that the Bureau traditionally receives an affidavit of posting from the Sheriff's office. She contacted the Sheriff's office to see if it could retrieve an affidavit of posting, but with a 2003 sale the timing was too remote. Therefore, according to the Popples, the Bureau failed to meet its burden to prove that the property was posted.
The Court has very serious concerns about the trial court's decision in this matter. As noted above, the sole stated basis for granting the petition to set aside was that the Bureau failed to post the Property as required by Section 602(e)(3) of the Tax Sale Law. This finding, however, is not supported by the evidence. No one proved conclusively that the Property was not posted. There is undisputed testimony that the Bureau could not get confirmation one way or the other from the Sheriff's office as the sale in 2003 was too remote. In addition, the reason for the Popples' delay in filing their petition has not been explained. Even by Victoria Popple's initial account she learned of the sale a year or more before they filed the petition. On her cross-examination, the Bureau produced a copy of a 2004 letter from the Popples' counsel to the Bureau acknowledging the sale, and she conceded that the tax sale notice might have caused her to go to the mapping department. Despite such awareness, they waited almost four years to file.
A further concern involves the purpose and effect of posting in the unusual facts of this case. The Court has stated that even when a property owner receives actual notice of a tax sale, a defect in the posting nevertheless may require a court to overturn the sale. O'Brien v. Lackawanna County Tax Claim Bureau, 889 A.2d 127 (Pa.Cmwlth.2005). The reason for such a result "is that the posting of notice serves the function of notifying the general public, as well as the owner, of a tax sale." Id. at 128 (citing Tax Sale of *523 Real Property in Paint Township). By opening the sale to the public at large, a taxing authority has greater opportunity to recover any lost tax revenue. Id. Nonetheless, in In re Tax Sale of 2003 Upset, 860 A.2d 1184 (Pa.Cmwlth.2004), the majority held that under the totality of the circumstances, the posting in that case was made where it was likely to give notice to the owner and the public, and it affirmed the trial court's conclusion that any defect in the posting was cured by actual notice to the owner of the impending sale. The owner (separated from his wife) did not receive notice of the tax sale, but when he visited the property with his daughter she found notice taped to a tree near the family mailbox across the road and not on the property itself.
Victoria Popple testified as to the nature of the Property as follows:
It's hard to get to. I use my flyovers from the Mapping Department to locate. We have a lot of little parcels that are actually old rail beds that some of them you cannot get to very easily. I have tried to drive it, I have tried to walk it. It's a little rough terrain.
N.T. 8; R.R. 148a. She stated further that she had been to the Property about seven times between 2003 and the time of the hearing "each trying a different venue to get into it. It was years ago that my father had taken me there. There is no direct road." Id. In view of her statements, the purpose of posting to provide notice to the general public could not be fulfilled in this case. Consequently, while strict compliance with statutory notice requirements is the rule, overturning the tax sale based solely on the Bureau's inability to prove posting is a particularly harsh result under the unique circumstances here. The testimony was uncontradicted that the Bureau could not secure evidence of posting because the sale was too remote.
The Popples also argue that the Purchasers did not present proof that the Popples should reasonably have discovered that the Property was sold. As noted at the hearing, Bureau Ex. 1 was a letter that counsel for the Popples sent on January 9, 2004 acknowledging the tax sale. As the Purchasers noted in their brief to the trial court in opposition to the petition to set aside, this Court in In re Tax Sale of Real Property Situated, 828 A.2d 475 (Pa. Cmwlth.2003), aff'd, 580 Pa. 63, 859 A.2d 471 (2004), stated that due process requires a taxing bureau to conduct a reasonable investigation to ascertain the identity and whereabouts of the latest owners of record of property that is subject to an upset sale in order to provide notice. The taxing bureau's duty is confined to determining the record owners and using ordinary common sense business practices to ascertain proper addresses where notice may be given. Id. (citing Farro v. Tax Claim Bureau of Monroe County, 704 A.2d 1137 (Pa.Cmwlth.1997)).
In the case sub judice, the Bureau sent notice to the address for the grantees indicated on the deed, and it was signed for by someone with the same last name who was permitted by the Post Office to receive certified mail at this post office box, who indicated his capacity as "Agent" and who signed for certified mail addressed to the Popples on other occasions. As a result, the Court concludes that the Bureau followed common sense business practices and that the Popples had implied actual notice. Under the totality of the circumstances, including the implied actual notice to the Popples, the lack of any likelihood that posting would have served the additional function of providing notice to the public and their unexplained delay of four years in bringing their petition, the Court determines that the trial court erred in granting the petition *524 to set aside the tax sale.[3] Accordingly, the order of the trial court is reversed.
ORDER
AND NOW, this 12th day of November, 2008, the order of the Court of Common Pleas of Luzerne County is reversed.
NOTES
[1] The Court's review in tax sale cases is limited to determining whether the trial court abused its discretion, rendered a decision lacking in supporting evidence or clearly erred as a matter of law. In re Dauphin County Tax Claim Bureau, 834 A.2d 1229 (Pa.Cmwlth.2003).
[2] The Purchasers state in footnote 3 of their brief that Victoria Popple testified that the Property is "hard to get to" and that she would locate it by flyover maps, and that there is no "direct road" to get to the Property. Notes of Testimony (N.T.) 8; R.R. 148a. From this they argue that even if the County posted the Property (assuming that they could get to it), the Popples would not have seen the posting, and the trial court's discounting of all other evidence in this case is a classic example of form over substance.
[3] Although the burden is on the tax claim bureau to show compliance with statutory notice provisions, it is evident from the facts of this case that a tax claim bureau may be prejudiced in meeting its burden when courts allow unexplained and lengthy delays to occur in filing petitions to set aside tax sales. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564011/ | 16 So. 3d 875 (2009)
Edward WERDELL, Petitioner,
v.
STATE of Florida, Respondent.
No. 2D08-6379.
District Court of Appeal of Florida, Second District.
June 24, 2009.
Rehearing Denied July 29, 2009.
*876 Edward Werdell, pro se.
No appearance for Respondent.
PER CURIAM.
Edward Werdell has filed a petition for writ of habeas corpus purporting to challenge various aspects of his judgments and sentences in Pinellas County circuit court cases 02-04399-CF, 02-07159-CF, 03-02914-CF, 03-09410-CF, 03-10735-CF, 03-12407-CF, 03-13875-CF, 03-18719-CF, and 03-18738-CF. In response to the petition and in view of Werdell's numerous filings over the past several years, almost all of which have been frivolous, we issued an order to show cause why this court should not direct the clerk to reject pleadings filed in this court related to the nine circuit court cases unless the filing is submitted by an attorney. Werdell has not filed a substantive response to our order. We therefore deny the petition and direct the clerk to place in an inactive file any notices of appeal or original proceedings filed by Werdell pro se relative to the nine circuit court cases unless the filing is signed by an attorney.
On October 24, 2003, Werdell pleaded guilty to nine felonies in five cases in the circuit court and admitted to violation of probation in two additional cases. The circuit court sentenced him in these cases to an overall prison term of fifteen years. On May 6, 2004, Werdell pleaded no contest to five felonies in another case and was sentenced to five years in prison concurrent with his earlier sentences. On August 10, 2004, he pleaded guilty to three felonies in an additional case and was sentenced to five years in prison, concurrent with his other sentences.[1] Werdell did not file a direct appeal in any of these cases.
Subsequently, Werdell filed numerous postconviction motions in the circuit court. Most if not all of these were dismissed or denied, and this court affirmed those orders that were appealed.[2] On June 24, *877 2007, the circuit court rendered an order barring Werdell from filing any pro se pleadings. Werdell filed a notice of appeal challenging that order in case 2D07-944 but voluntarily dismissed the appeal.
Since 2004, Werdell has filed a total of fifty actions in this court relative to one or more of his nine circuit court cases, including the postconviction appeals just mentioned, twenty-four habeas petitions, five petitions for writ of certiorari, four petitions for belated appeal, and several additional appeals and mandamus petitions.
The habeas petitions, the petitions for writ of certiorari, and all but the earliest-filed petition for belated appeal are frivolous. See Mercade v. State, 698 So. 2d 1313, 1315 (Fla. 2d DCA 1997) ("`A frivolous appeal is not merely one that is likely to be unsuccessful. It is one that is so readily recognizable as devoid of merit on the face of the record that there is little, if any, prospect whatsoever that it can ever succeed.'") (quoting Treat v. State ex rel. Mitton, 121 Fla. 509, 163 So. 883, 883 (1935)), disapproved of on other grounds by Hall v. State, 752 So. 2d 575 (Fla.2000). Almost without exception, Werdell's filings seek relief that cannot be granted with respect to the category of petition filed. The habeas petitions, including the petition filed in the present case, all concern direct-appeal, postconviction, or sentencing issues that were or should have been raised in the circuit court. See, e.g., Baker v. State, 878 So. 2d 1236, 1245 (Fla.2004) ("The remedy of habeas corpus is not available in Florida to obtain the kind of collateral postconviction relief available by motion in the sentencing court pursuant to rule 3.850."); Breedlove v. Singletary, 595 So. 2d 8, 10 (Fla.1992) ("Habeas corpus is not a second appeal and cannot be used to litigate or relitigate issues which could have been, should have been, or were raised on direct appeal."). Moreover, not only are the habeas petitions frivolous, they are frequent and repetitious, raising the same issues in various combinations.
The petitions for writ of certiorari request a remedy that does not exist in certiorari; as such, there is no "`prospect whatsoever that [they] can ever succeed.'" Mercade, 698 So.2d at 1315 (quoting Treat, 163 So. at 883). All five petitions improperly ask this court to review its own determinations (dismissals or denials) in Werdell's habeas filings in this court. Cf. Haines City Cmty. Dev. v. Heggs, 658 So. 2d 523, 525 (Fla.1995) (noting that certiorari "involves a limited review of the proceedings of an inferior jurisdiction"); Powell v. Civil Serv. Bd., 154 So. 2d 917, 919 (Fla. 1st DCA 1963) ("Certiorari is the traditional proceeding by which to obtain review of the orders, judgments and decrees of an inferior tribunal.").
All but the earliest-filed petition for belated appeal are frivolous. The first petition was denied following a commissioner's hearing. The remaining petitions improperly sought the identical relief requested in the first petition and were subsequently denied. See Fla. R. App. P. 9.141(c)(5)(C).
Werdell's frequent frivolous and repetitious filings burden the limited resources of this court, resources that are better reserved for the resolution of genuine disputes. As such, and in the absence of a timely substantive response from Werdell to our order to show cause, we deny the petition for writ of habeas corpus in case 2D08-6379 and direct the clerk of this court to place in an inactive file any notices of appeal and original proceedings filed by Werdell relative to the nine circuit court cases recited in the first paragraph of this opinion unless the filing is signed by a member in good standing of The Florida Bar. See State v. Spencer, 751 So. 2d 47 (Fla.1999).
*878 Petition for writ of habeas corpus denied.
FULMER, VILLANTI, and LaROSE, JJ., Concur.
NOTES
[1] The nine cases recited in this paragraph are the nine enumerated in the first paragraph of this opinion.
[2] See Werdell v. State, 945 So. 2d 520 (Fla. 2d DCA 2006) (table decision); Werdell v. State, 944 So. 2d 367 (Fla. 2d DCA 2006) (table decision); Werdell v. State, 916 So. 2d 804 (Fla. 2d DCA 2005) (table decision); Werdell v. State, 910 So. 2d 270 (Fla. 2d DCA 2005) (table decision). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564033/ | 616 S.W.2d 829 (1981)
STATE of Missouri, Respondent,
v.
Earl WILKERSON, Defendant-Appellant.
No. 62497.
Supreme Court of Missouri, En Banc.
May 11, 1981.
Rehearing Denied June 11, 1981.
*830 Cornelius T. Lane, Sp. Asst. Public Defender, St. Louis, for defendant-appellant.
John Ashcroft, Atty. Gen., Nancy Kelley Baker, Asst. Atty. Gen., Jefferson City, for respondent.
DONNELLY, Judge.
Pursuant to Rule 83.02, the Eastern District of the Court of Appeals, upon application of the State, ordered this cause transferred to this Court after filing an opinion reversing appellant's second degree murder conviction and affirming his robbery and kidnapping convictions. Although we dispose of this case as if it were the original appeal, Mo.Const. Art. V, § 10, portions of the Court of Appeals opinion are incorporated, without quotation marks, in this opinion.
By the Eastern District's order transferring the case to this Court, we are squarely confronted with an issue which has caused considerable consternation in the Bench and Bar of this State: Does that part of the opinion in State v. Handley, 585 S.W.2d 458 (Mo. banc 1979), which would hold that second degree murder is no longer a lesser offense of first degree murder, have any continuing vitality? See State v. Bradshaw, 593 S.W.2d 562, 565 (Mo.App.1979); State v. Martin, 602 S.W.2d 772 (Mo.App. 1980); State v. McCall, 602 S.W.2d 702 (Mo. App.1980). For the reasons set forth herein, we hold that it does not. We first set out the relevant facts leading to this appeal.
Vernice Weary and her sons Larry, age 15, and Michael, age 17, lived on the first floor of a flat at 4538 Red Bud in the City of St. Louis. In the early morning hours of July 30, 1977, all three were in the house; Larry and Michael were asleep in the same bedroom. Larry was awakened by the sound of gunshots coming from the direction of his mother's bedroom. Shortly after the shots were fired, the light was turned on in the boys' room and appellant and Horice O'Toole entered. Each had a pistol in his hand. Appellant was known by the boys because he had dated their mother and visited in the home. They had broken up about three months before this occurrence. Appellant ordered Larry to "get up." O'Toole grabbed Michael, put a gun to his head and ordered him to lie on the floor. Appellant left the room and returned with Vernice's purse. He handed the purse to O'Toole who gave it to Michael with an order to look for the car keys and the money. Michael turned over $30.00 that he found in the purse. The car keys were not in the purse. When asked where the keys were, Michael told them they would be in his mother's room or "in the door." Appellant left and returned with the car keys. The boys got dressed and Michael was then told to unlock the door to a third bedroom *831 where a stereo component was kept. After opening the door, they started to disconnect the component as instructed when a noise from upstairs was heard. Appellant told the boys to forget the stereo saying "[i]t won't look right bringing it out this time of the morning."
Appellant and O'Toole took Michael and Larry with them when they left in Vernice's automobile with appellant driving. After appellant stopped for gasoline, they drove to Fourth and Bond Streets in East St. Louis, Illinois. When they stopped, O'Toole asked appellant, "Do you want to do one of these with me?" The men got the two boys out of the car. Appellant ordered Michael to climb into a boxcar that was standing on railroad tracks nearby. Appellant climbed into the boxcar behind Michael, aimed the gun at him and fired. Hit in the left shoulder, Michael spun around and fell to the floor. Appellant fired two more shots that missed Michael.
O'Toole took Larry to the far side of the railroad cars and ordered him to run up the hill. When Larry neared the top, O'Toole ordered him to lie down. He then shot him in the leg and then left with appellant.
The boys managed to get to their grandfather's house in the immediate neighborhood. They told their grandfather what had happened and called Vernice's employer. They were then taken to the hospital. The body of Vernice was found in her bedroom. The bullets found in her body had the same markings as those found in the boxcar where appellant shot Michael Weary.
On August 23, 1977, appellant was charged by an indictment with one count of capital murder in violation of §§ 559.005 and 559.009(1), RSMo Supp. 1975, two counts of kidnapping in violation of § 559.240, and one count of first degree robbery in violation of §§ 560.120 and 560.135. (This indictment, of course, preceded the effective date of amended Rule 24.04 [now Rule 23.05], which permits only related capital murder offenses to be charged in the same indictment or information with other capital murder offenses. That rule became effective January 1, 1979.)
For the apparent reason that on August 23, 1977, the date the indictment was filed, §§ 559.005 and 559.009 had been repealed and replaced by §§ 565.001 and 565.008, a substitute information in lieu of the indictment was filed on April 6, 1978, charging appellant with violation of §§ 565.001, 565.008, and the same counts of kidnapping and first degree robbery charged in the indictment.
On May 2, 1978, an amended information was filed substituting a charge of first degree murder, §§ 565.003 and 565.008, RSMo Supp. 1977, for the capital murder charge.
A jury convicted appellant of second degree murder, first degree robbery, and two counts of kidnapping. The jury was unable to agree upon punishment, and the court assessed punishment at 75 years imprisonment on the conviction of second degree murder, 10 years on each of the kidnappings, and 15 years on the robbery; the kidnapping and robbery sentences are to run concurrently with each other and consecutive to the sentence for second degree murder. Appellant appealed the judgment entered upon the jury verdict to the Court of Appeals, Eastern District.
Before addressing the points raised by appellant, the Eastern District, sua sponte, considered the effect of State v. Handley, supra, and said:
"The plurality opinion of Seiler, J. in Handley states at page 462.
`"common form" second degree murder (§ 559.020) is not a lesser included offense of "first degree felony-murder" under § 559.007 because the latter does not include the elements of willfulness, premeditation, or malice aforethought, each of which are necessary for "common form" second degree murder.'
"Although this portion of the opinion had no concurrence and thus was not decided with authority the Supreme Court denied transfer of State v. Bradshaw, 593 S.W.2d 562 (Mo.App.1979) which adopted the rationale of the Handley plurality as quoted above. We thus *832 feel constrained to hold that the trial court was without jurisdiction to instruct on common form second degree murder because that crime was not charged in the amended information. The conviction on that issue cannot stand. State v. Bradshaw, supra."
The Eastern District then went on to hold that appellant could be retried for second degree murder and affirmed his robbery and kidnapping convictions. As stated earlier, the Eastern District granted the State's application for transfer of the case to this Court.
The plurality opinion in Handley stated that the "protection of [Article I, § 17 of the Missouri Constitution] renders any conviction for a crime not charged or necessarily included in the underlying indictment or information a nullity." (Emphasis added). The flaw in the opinion is that it gave recognition to the provisions of § 556.230, RSMo 1969 (applicable in Handley and in this case) but ignored the provisions of § 556.220, RSMo 1969 (also applicable in Handley and in this case).
Section 556.230, supra, reads as follows: "Upon an indictment for an assault with intent to commit a felony, or for a felonious assault, the defendant may be convicted of a less offense; and in all other cases, whether prosecuted by indictment or information, the jury or court trying the case may find the defendant not guilty of the offense as charged, and find him guilty of any offense, the commission of which is necessarily included in that charged against him." (Emphasis added).
Section 556.220, supra, reads as follows: "Upon indictment for any offense consisting of different degrees, as prescribed by this law, the jury may find the accused not guilty of the offense charged in the indictment, and may find him guilty of any degree of such offense inferior to that charged in the indictment, or of an attempt to commit such offense, or any degree thereof; and any person found guilty of murder in the second degree, or of any degree of manslaughter, shall be punished according to the verdict of the jury, although the evidence in the case shows him to be guilty of a higher degree of homicide." (Emphasis added).
The jury in this case found appellant guilty of second degree murder under a charge of first degree murder. In our view, the jury thereby found appellant guilty of a degree of murder "inferior to that charged in the indictment * * *." See §§ 565.003 and 565.004.
That the legislature has recognized and continues to recognize a difference between an offense being a lesser offense of the offense charged because it is specifically denominated as such and an offense being a lesser offense because it is necessarily included in the offense charged is clear from § 556.046, the language of §§ 556.220 and 556.230, supra, and the statutory history behind the latter sections. The initial predecessor of § 556.220 was R.S. 1835, p. 214, § 14, which provided:
"§ 14. Upon an indictment for an offence, consisting of different degrees, as prescribed by this act, the jury may find the accused not guilty of the offence charged in the indictment, and may find him guilty of any degree of such offence, inferior to that charged in the indictment, or of an attempt to commit such offence."
And, until the initial predecessor of § 556.230 was enacted, R.S. 1879, p. 285, § 1655, one could not be convicted of a lesser offense of the offense charged unless it was specifically denominated as a lower degree of the offense charged, regardless of whether it was necessarily included in the offense charged or not. See State v. Davidson, 73 Mo. 428 (1881).
Of course, if this case had arisen after January 1, 1979, the effective date of § 556.046, RSMo 1978, a portion of that section would rule the case. It restates the substance of § 556.220, supra: "1. A defendant may be convicted of an offense included in an offense charged in the indictment or information. An offense is so included when * * * (2) It is specifically denominated by statute as a lesser degree of the offense charged; * * *."
*833 Since second degree murder, of which appellant was convicted, is "specifically denominated by statute as a lesser degree of the offense charged"first degree murder no error would be present here.
Section 556.046 is a legislative determination that an offense can be a lesser offense of another offense so that a charge of the greater will support a conviction of the lesser although the lesser is not necessarily included in the greater as was required in Handley. Of course, "[c]onviction upon a charge not made would be sheer denial of due process." DeJonge v. Oregon, 299 U.S. 353, 362, 57 S. Ct. 255, 259, 81 L. Ed. 278 (1937). However, by specifically denominating a crime as a lesser degree of another, the constitutional requirements that one be apprised of the charge against him, found in the Sixth Amendment to the United States Constitution and Art. I, § 18(a) of the Missouri Constitution are met.
The opinion in Handley, supra, insofar as it conflicts with the view expressed herein, should no longer be followed.
Viewing the evidence in the light most favorable to the State, we conclude there is sufficient substantial evidence to support the conviction of second degree murder.
We now turn to the points raised by appellant.
Appellant alleges the trial court erred in permitting the State to file a substitute information in lieu of the indictment because the original indictment was a nullity in that it was based upon a statute that had been repealed. Although it is true that § 559.005, under which appellant was charged by indictment on August 23, 1977, had been repealed on May 26, 1977, and replaced with § 565.001, RSMo Supp. 1977, a comparison of the two statutes demonstrates that the incorrect citation to § 559.005 in the indictment does not amount to a "defect or imperfection [tending] to the prejudice of the substantial rights of the defendant upon the merits." § 545.030, RSMo 1978. Section 559.005 provided: "A person is guilty of capital murder if he unlawfully, willfully, knowingly, deliberately, and with premeditation kills or causes the killing of a human being." Section 565.001, RSMo Supp. 1977 (now RSMo 1978), provided: "Any person who unlawfully, willfully, knowingly, deliberately, and with premeditation kills or causes the killing of another human being is guilty of the offense of capital murder."
Although the language of the statutes is not identical, the fact that both statutes contain exactly the same elements leads us to conclude that appellant was not misled by the incorrect citation. See State v. Jackson, 594 S.W.2d 623 (Mo.1980). The trial court did not err in permitting the filing of the substitute information.
We now address appellant's points related to his convictions of robbery and kidnapping, crimes charged in both the substitute information and the amended information.
Appellant interposed the defense of coercion. In aid of that defense he testified that he had gone to Ms. Weary's home sometime after 1:30 a. m. seeking transportation to his home. While visiting with her, she answered the door and admitted a man who "had some kind of garment pulled over his face." This man, who was carrying two guns, had a discussion with Vernice and then shot her two or three times. Appellant testified that Horice O'Toole handed appellant an unloaded gun and said, "Just do like I tell you and you won't get hurt." He said that everything he did while in the presence of O'Toole was done under O'Toole's orders.
Appellant contends that the court unduly restricted his voir dire examination of the jurors in that it would not permit him to inquire whether members of the jury panel would consider the defense of coercion.
This issue arose when counsel for appellant stated to the jury, "Now, in this particular case the defense of coercion will be the defense as to Counts II, III and IV." Counsel for the State then asked for a side bench conference. Defense counsel, during the colloquy, stated, "Here's my point, Judge. *834 The State may ask the question and they are allowed to ask questions if we prove these facts will you find the defendant guilty. I think I have a right to ask this jury if I have a defense if they feel that that is a valid defense or they wouldn't even consider that as a defense' cause if a person says, `I can't possibly consider coercion as a defense,' then he cannot consider the law in the case, and I think I have a right to ask."
It is obvious from the portion of the voir dire contained in the transcript that the court understood that any question would include a reference to facts that appellant intended to prove. Counsel had evidently been referring to facts throughout the voir dire because the court commented that counsel were "trying to try this case on voir dire."
Counsel told the court that he wanted to ask the question because he felt that he would have evidence of coercion, a valid defense and "I think I should be able to inquire of them as to whether or not they would consider that awould even consider that as a defense." His statement did not dispel the court's concern that his question would contain reference to facts which he intended to prove. In giving the reason for its ruling, the court stated, "This is not the time to offer evidence with respect to the defenses and I'm not going to permit it. I think it's sufficient if counsel inquires as to whether or not he has a defense which the Court instructs on whether they will follow that without mentioning the type of defense whether they will follow the instructions and consider all of the instructions in the case."
Appellant relies upon State v. Brown, 547 S.W.2d 797, 798 (Mo. banc 1977), which is distinguishable from the case at bar. Although counsel for Brown did not proffer the specific question that he intended to ask, he told the court that he would ask the jury "whether they could follow the law with respect to the burden of proof on [self-defense]." He further assured the court that in asking the question he would not go into the "details" of the case. The court in Brown reiterated the principle that "a litigant's method of challenging a trial court's ruling on permissible voir dire questions should be specific." Id. at 800. It held, however, that even though counsel did not offer the specific question he wished to ask, he made it clear that he intended to use a proper question without going into the factual basis for the instruction that the court might give.
In the case now before us, counsel failed to assure the court that he would not refer to facts he intended to prove. In addition, the court and defense counsel in Brown were concerned about mental attitudes of the veniremen toward requiring the State to negate the defense. Such concern was not present in this case because, as the trial court recognized, the burden of proving coercion remains upon the defendant. We do not believe the court abused its discretion in refusing to permit the questioning. State v. Ross, 563 S.W.2d 125 (Mo.App.1978).
The trial court did not err in refusing to allow evidence of oral and written statements appellant made to the police that appellant admits were self-serving and not a part of the res gestae. State v. Hemphill, 504 S.W.2d 62 (Mo.1974).
Appellant next complains that during argument the State sought by inflammatory appeals to arouse personal hostility or personal fear of the appellant. He relies upon State v. Heinrich, 492 S.W.2d 109 (Mo. App.1973).
That portion of the argument of which he complains reads as follows:
"What then is our purpose here other than to do justice? To analyze the facts and to speak honestly from our conscience what we have heard. That is your job. It is to take a man like this who would do such a horrible thing and have the audacity to come in here and say such stuff for lack of a more appropriate word, it is to take this man who would not just robjust heinous, heinous crimeand it is to take him for our protection just like that dead lock bolt, just *835 like that iron gatenone of which workedis for the protection of all the Vernice Wearys up and down Red Bud Avenue and up and down Carondelet and up and down Grand and Ohio and Oleatha and Fairview and all over this town, and it's to remove him from this town so that the kids like this can grow up in the world and not have to have an iron gate, not have to double bolt the door to just live."
It is generally held that control of argument rests largely in the sound discretion of the trial court. State v. Kimmins, 514 S.W.2d 381 (Mo.App.1974). Prosecutors are permitted wide latitude in arguing the necessity for law enforcement and the jurors' responsibility in that regard in line with punishment to be assessed. State v. Wade, 535 S.W.2d 492, 498 (Mo.App.1976). The case before us is similar to State v. Evans, 406 S.W.2d 612 (Mo.1966). The portion of the argument complained of here came at the very end of the State's closing argument. The opening argument and the major portion of the closing argument were devoted to a discussion of the facts pointing to appellant's guilt. At the end of his argument, counsel urged the jury to "do justice," to analyze the facts and make a determination dictated by their conscience based upon the facts. The reference in the State's argument here respecting appellant, as in Evans, is predicated on a finding of guilt. Under such circumstances the rules set out in State v. Heinrich, supra, are not violated. The case at bar does not contain the repeated highly inflammatory comments found in Heinrich. The court did not abuse its discretion in overruling appellant's objection to the portion of the argument set out above.
Appellant next claims that the court erred in giving MAI-CR 2.10 (accomplice) in connection with the instructions on murder first degree, felony murder, murder in the second degree, and manslaughter because there was no evidence that appellant was associated with O'Toole in the commission of the killing of Ms. Weary.
Appellant argues that the only evidence concerning the killing of Vernice Weary was the testimony of appellant that "a masked man came to [Vernice's] home, argued with her, then shot her." The jury was not required to believe the testimony of appellant. State v. Wade, supra, at 495. As set out in the facts above, there was sufficient evidence that appellant and O'Toole were acting together, that one of them shot her, and that it may have been appellant. Both men had guns. The bullets found in the boxcar where appellant shot Michael and those taken from the body of the deceased had similar markings. They had the same number of lands and grooves. During the time that appellant and O'Toole were in the presence of Michael and Larry, the two men were cooperating with each other. There was no evidence, outside of appellant's testimony, that O'Toole was acting alone and that appellant was under the domination of O'Toole. The jury could find from the evidence that the appellant and O'Toole had killed Vernice and appellant took the initiative of taking her purse and obtaining the car keys in aid of their escape. It was the appellant who made the decision not to take stereo equipment for fear of detection, indicating that he was exercising some authority in the enterprise.
Appellant relies on State v. Jackson, 463 S.W.2d 857 (Mo. banc 1971) which is readily distinguishable because in Jackson the State relied solely upon a statement made by the defendant that exonerated defendant of the charge upon which he was convicted. We find that there was sufficient evidence that appellant and O'Toole were accomplices.
Appellant also argues that the instruction of his defense of coercion as to the charges of kidnapping and robbery was erroneous because they placed the burden of proving coercion upon appellant rather than the State.
Under Missouri's pattern instructions, the defendant has the burden of proof on affirmative defenses but not on special negative defenses. State v. Brown, 547 *836 S.W.2d 797, 799 (Mo. banc 1977), and MAI-CR 2.04 Notes on Use, paragraph 2. In State v. Brown, 561 S.W.2d 388, 391 (Mo. App.1977), where both the prosecution and defense submitted coercion instructions in the form of a special negative defense, placing the burden of proof on the State, the court was not required to determine the issue presently before us. The court did, however, comment in a footnote that coercion is an affirmative defense according to the great weight of authority.
We believe that any doubt as to whether duress or coercion is an affirmative defense or a special negative defense has been resolved by the adoption of MAI-CR 3.26 on duress, effective January 1, 1979. The instruction places the burden of proof on the defendant and Notes on Use, paragraph 4, states that duress is an affirmative defense.
Appellant's reliance upon State v. Davis, 559 S.W.2d 602, 605 (Mo.App.1977) is misplaced. In Davis the defendant sought to impose the defense of coercion contending that the crime was committed under the domination of her husband. This would invoke the common law rule that a crime committed by a wife in the presence of her husband is presumed, in the absence of contrary evidence, to have been coerced. It was in this posture that the court was prompted to state, at page 605, "When the evidence gives rise to the presumption of coercion by the husband, it falls to the State to show that the wife was not drawn to the offense by him but committed the conduct voluntarily; otherwise the presumption of duress will prevail." The court further held that the facts in that case did not give rise to the presumption.
Finally, appellant alleges the trial court erred in giving verdict-directing instructions on robbery of Vernice Weary. We conclude there was substantial evidence, as recited supra, to support the submission of the robbery instructions. The fact that the taking of Ms. Weary's property did not occur precisely simultaneously with the exercise of violence upon her does not render the submission of the instruction improper. See State v. Hayes, 518 S.W.2d 40, 45-46 (Mo.banc 1975).
The convictions of murder second degree, kidnapping, and robbery are affirmed.
RENDLEN, WELLIVER and HIGGINS, JJ., concur.
MORGAN, J., concurs in separate concurring opinion filed.
BARDGETT, C. J., dissents in separate dissenting opinion filed.
SEILER, J., dissents in separate dissenting opinion filed and concurs in separate dissenting opinion of BARDGETT, C. J.
MORGAN, Judge, concurring.
I concur not only because of the reasoning found in the principal opinion but also by reason of my dissent in State v. Handley, 585 S.W.2d 458 (Mo.banc 1979) at page 471.
BARDGETT, Chief Justice, dissenting.
I respectfully dissent.
Art. I, § 18(a), Constitution of Missouri, provides "That in criminal prosecutions the accused shall have the right * * * to demand the nature and cause of the accusation * * *."
Amendment VI, Constitution of the United States, provides "In all criminal prosecution, the accused shall enjoy the right * * * to be informed of the nature and cause of the accusation; * * *."
The above provisions are satisfied when the charging instrument, here an "information," tells an accused what the prosecution claims he did and the crime or crimes for which a conviction will be sought. As long as the essential differences between a homicide charged (e. g. capital murder) and the homicide convicted of (e. g. second degree murder) are purely the severity or degree of the mental intent of the accused there is no difficulty in applying the rule that a charge of the higher includes a charge of the lower. The overt acts are the same for both offenses and by charging the mental intent required for the higher the mental intent required for the lower is necessarily *837 part of the higher.[1] No additional or different fact need be proven or element satisfied to authorize a conviction of second degree murder than those shown for capital murder.
However, when the hybrid offenses which are pure creatures of statute are considered, the foregoing is not true, regardless of what name is given to the offense. The offense now called murder in the first degree set forth in § 565.003 requires for its commission that the defendant (1) perpetrate or attempt to perpetrate the felonies of arson, rape, robbery, burglary or kidnapping, and (2) that he kill someone unlawfully while so doing but without regard to whether the accused had a premeditated intent to kill. In short, the prosecution need not prove and the jury need not find the accused intended to kill the deceased in order to find the accused guilty of a violation of § 565.003 (first degree murder).
Second degree murder, the alleged lesser included offense, requires for its commission the premeditated intent to kill, and the jury must so find in order to convict of that offense. That another felony was being perpetrated when the killing occurred is not necessary to murder in the second degree.
It is apparent that the intent to kill required in second degree murder is not an element of first degree murder and, therefore, second degree murder cannot be a lesser included offense of first degree murder as defined in § 565.003 because first degree does not include all of the legal elements of second degree. State v. Smith, 592 S.W.2d 165, 166 (Mo.banc 1979). Because it is not a lesser included offense of first degree murder it is not an offense that is included in the charge of first degree murder. State v. Smith, supra.
"A court may not instruct on an offense not specifically charged in the information or indictment unless it is a lesser included offense. This is because due process requires that a defendant may not be convicted of an offense not charged in the information or indictment." State v. Smith, supra at 165. To convict a person of a crime not charged violates due process rights. Cole v. Arkansas, 333 U.S. 196, 68 S. Ct. 514, 92 L. Ed. 644 (1948); Presnell v. Georgia, 439 U.S. 14, 99 S. Ct. 235, 58 L. Ed. 2d 207 (1978). In my opinion a conviction on a crime not charged denies an accused the constitutional right to notice of the nature and cause of the accusation. Art. I, § 18(a), Constitution of Missouri; Amendment VI, Constitution of United States.
The principal opinion does not hold that second degree murder was properly submitted as a lesser included offense of the crime denominated in § 565.003, called first degree murder, but rather justifies the submission of second degree murder upon a § 556.220, RSMo 1969, which, inter alia, appears to authorize a jury to find a defendant "guilty of any degree of such offense inferior to that charged in the indictment." I do not believe the General Assembly intended, by § 556.220, to authorize a court or jury to commit an unconstitutional act and therefore do not agree that § 556.220 was intended to or does authorize the submission of an offense not charged in the information or necessarily included in the specific charge found in the information. Certainly a statute cannot legalize what is illegal under our state and federal constitutions.
Nor does the principal opinion hold that the charge of first degree murder necessarily included second degree murder and it is clear, under the criteria set forth in State v. Smith, supra, that it does not do so.
The point is that by charging a person with a homicide that does not require an intent to kill (§ 565.003) it cannot be said that he is on notice that the prosecution will attempt to convict him of a homicide that does require an intent to kill (§ 565.004).
Given the definitions of first and second degree murder in Missouri (§§ 565.003 and 565.004), due process prohibits the submission *838 of second degree murder on a charge of first degree murder.
I therefore dissent from the affirmance of the second degree murder conviction.
SEILER, Judge, dissenting.
I respectfully dissent. I do not believe it is constitutional to charge defendant with first degree murder and convict him of second degree murder.
No matter what the old law may have been about first degree felony murder involving deliberation and premeditation, the current first degree murder statute does not. It became effective May 26, 1977 and it provides as follows:
"Any person who unlawfully kills another human being without a premeditated intent to cause the death of a particular individual is guilty of the offense of first degree murder if the killing was committed in the perpetration of or in the attempt to perpetrate arson, rape, robbery, burglar, or kidnapping."
Its predecessor, § 559.007, RSMo Supp. 1975, which became effective September 28, 1975, was almost in the same language and provided as follows:
"The unlawful killing of a human being when committed without a premeditated intent to cause the death of a particular individual but when committed in the perpetration of or in the attempt to perpetrate arson, rape, robbery, burglary, or kidnapping is murder in the first degree."
Twice within two years, as we see, the legislature has enacted statutes eliminating premeditated intent as an element of first degree murder and requiring only that the killing be done in the perpetration and attempted perpetration of certain felonies. Likewise the MAI-CR2d instructions for first degree murder contain no finding of intent, but simply that defendant caused the death of the victim in committing or attempting to commit a particular felony. See MAI-CR2d 15.12 as typical.
Second degree murder, however, requires willful, premeditated killing with malice aforethought. State v. Franco, 544 S.W.2d 533, 535 (Mo.banc 1976), cert. den. 431 U.S. 957, 97 S. Ct. 2682, 53 L. Ed. 2d 275 (1977). See MAI-CR2d 15.14 the required instruction on conventional second degree murder.
I fail to see where charging a defendant with first degree murder in any way amounts to a charge of second degree murder. As the principal opinion agrees, second degree murder is not a lesser included offense of first degree murder, and while the principal opinion does not agree with this, I do not believe it is a degree of murder inferior to that charged in the amended information in the present case.
To borrow from Shakespeare, what's in a name? Providing by statute, § 556.220, that the jury may find defendant, when charged with something else, "guilty of any degree of such offense inferior to that charged", and then calling an offense first degree murder in one statute, § 565.003, and saying in another statute, § 565.004, that all other kinds of murder, with certain exceptions, shall be murder in the second degree, does not mean that second degree murder is somehow "inferior" to first degree murder. One requires premeditation, the other does not. At the time of the offense in question, one involved a penalty of life imprisonment, the other permitted a heavier penalty.
The amended information in the case before us charged first degree murder, for which the penalty at time of the offense was life imprisonment. Section 565.008.2, RSMo Supp.1977. But second degree murder carried a heavier penalty at that time. Imprisonment upon conviction could be as long as 200 years, as this court declared in State v. Stephens, 507 S.W.2d 18, 22 (Mo. banc 1974), or even 500 or 1000 years. I would not call second degree murder a degree of murder inferior to first degree murder when the penalty for the former is higher than the latter.
I think the matter is properly put in an early case, State v. Shoemaker, 7 Mo. 177, 180 (1841), a forgery case. That case discussed the fourteenth section of the 9th article of the act concerning crimes and *839 punishments (R.C. 1835, p. 214), the predecessor of § 556.220. The 1835 statute likewise provided that the jury may find the defendant guilty of any degree of the offense "inferior to that charged in the indictment." The court said:
"[T]he fourteenth section could not have been intended to dispense with the rules of the common law, and I may add, of common justice, that the allegation and proofs must correspond. If the inferior degree of offence, of which the party is convicted, be included in the allegations of the indictment, a conviction of such inferior degree is consistent with established principles. But if the other offence be of a totally dissimilar nature, and no count in the indictment contains any description of the inferior offence proved, no judgment could be given against the defendant upon such proof. If, for example, the indictment charges a forgery in the second degree, which our statute declares to consist in counterfeiting coin, or in passing or attempting to pass such coin, the defendant cannot be legally convicted of forgery in the third degree, which consists in making false entries in books with fraudulent intent, &c."
Here the offense of which defendant was convictedsecond degree murderis of a totally dissimilar nature from the offense with which he was accused. He was convicted of an offense requiring a definite intention to kill the victim. He was acquitted of the offense with which he was charged and convicted of one with which he was not charged. I do not believe this can constitutionally be done and I do not believe that a statute which purports to permit a jury to find defendant guilty of an offense different from that charged but which is said to be "inferior to that charged in the indictment" can make it constitutional.
Designating something as "inferior to that charged in the indictment" does not give notice of what it is anymore than designating it as "superior to that charged in the indictment" would. Whether second degree murder is "inferior to" or "superior to" first degree murder, it is a different offense, with different elements. Defendant was not charged with second degree murder or constitutionally warned that he could be convicted of it under the amended information filed against him. "There can be no trial, conviction or punishment for a crime without a formal and sufficient accusation." State v. McKinley, 341 Mo. 1186, 111 S.W.2d 115, 118 (1937).
Additionally, if murder requires an intent to kill, then the legislature cannot define it without the intent to kill, although this is exactly what is attempted in the present first degree murder statute. Second degree murder, which does require an intent to kill, cannot be an inferior grade of an offense which requires no intent to kill, simply because the latter is also called murder.
I would reverse the second degree murder conviction.
NOTES
[1] However, many problems would be solved and appeal time shortened if prosecutors simply set forth in the information or indictment the crimes the prosecutor intends to submit whether technically lesser included or not. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564069/ | 616 S.W.2d 318 (1981)
Francis ROTELLO, Appellant,
v.
TWIN CITY INTERNATIONAL, INC., et al., Appellees.
No. 17859.
Court of Civil Appeals of Texas, Houston (1st Dist.).
April 2, 1981.
Rehearing Denied April 30, 1981.
*319 Sears & Burns, Charles Dippel, Houston, for appellant.
Vinson & Elkins, Robert A. Rowland, III, Susan A. Ohsfeldt, Houston, for appellees.
Before EVANS, WARREN and DOYLE, JJ.
EVANS, Justice.
The principal issue in this case is the validity of a finance charge added to the purchase price of certain farming equipment acquired under three retail installment contracts.
The plaintiff seeks in this action to recover penalties and attorney's fees for alleged violations of Tex.Rev.Civ.Stat.Ann. art. 5069 (Vernon 1971), contending that the finance charge in question was a) either interest that was usurious under subtitle one of article 5069 or was b) a time price differential not authorized and, therefore, unlawful under the provisions of subtitle two, article 5069. Both parties moved for summary judgment, and the trial court denied the plaintiff's motion and granted that of the defendants. The plaintiff brings this appeal.
Each of the retail installment contracts states a cash price and a deferred payment price which includes a time price differential denominated as a "finance charge." The face of each contract reflects the per annum percentage rate used to determine the finance charge. This method of disclosing the time price and credit price was expressly approved in Rattan v. Commercial Credit Co., 131 S.W.2d 399 (Tex.Civ. App. Dallas 1939, writ ref'd.), and Anguiano v. Jim Walter Homes, Inc., 561 S.W.2d 249 (Tex.Civ.App.San Antonio 1978, writ ref'd. n. r. e.). This court has held that if a retail installment contract shows on its face that there is a cash price and a deferred payment price which are revealed to the purchaser at the time of the contract and if the finance charges are set forth as such, the amount of such charges will not be deemed interest and, therefore, does not fall within the purview of the usury law. International Harvester Co. v. Rotello, 580 S.W.2d 418 (Tex.Civ.App.Houston [1st Dist.] 1979, no writ). The contracts in question are substantially similar, if not identical, to the contract considered by this court in International Harvester Co. v. Rotello, supra, and the finance charge in such contracts *320 does not constitute "interest" within the meaning of the usury statute.
Neither do the finance charges constitute time price differentials regulated by subtitle two, article 5069. Chapter two of that subtitle contains only general provisions and chapters three, four and five pertain only to the regulation of "loans." Because the transactions in question involve no "cash advance" or "interest" charge, as defined in chapter, two, the transactions were not "loans" within the meaning of the statute. Chapter six regulates the charging of time price differentials in retail installment sales of "goods," which term is defined as "tangible personal property ... when purchased primarily for personal, family or household use and not for commercial or business use...." The record reflects that the farm implements in question were purchased by the plaintiff for commercial or business use, as distinguished from personal, family, or household use, and such equipment does not fall within the definition of "goods" as used in the statute. Chapter six A regulates installment sales of manufactured homes, and is, therefore, inapplicable to the transactions in question. Chapter seven regulates the charging of time price differentials in motor vehicle sales, and chapter eight merely sets forth the penalties for contracting for, charging or receiving interest, time price differentials or other charges greater than authorized.
The declaration of legislative intent preceding article 5069 indicates a desire to protect the citizens of this state from deceptive trade practices in certain areas of loans and credit sales and services where abuses had been noted. The legislature obviously intended to exercise regulatory control over the charging of time price differentials in connection with sales of motor vehicles, manufactured homes, and consumer "goods." Because the farming equipment in question does not fall within any of these specified categories, the charging of time price differentials with respect to these transactions is not governed by the provisions of article 5069. Therefore, the trial court did not err in granting the defendant's motion for summary judgment.
The trial court's judgment is affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1565233/ | 433 S.W.2d 669 (1968)
Stanley D. LINDSEY et ux.
v.
STEIN BROTHERS & BOYCE, INC.
Supreme Court of Tennessee.
October 25, 1968.
Hugh C. Howser, Nashville, for appellants.
Harris A. Gilbert, Nashville, for appellee; Barksdale, Whalley, Leaver, Gilbert & Frank, Nashville, of counsel.
OPINION
BURNETT, Chief Justice.
The original bill was filed herein by the appellants, customers, against their stockbroker, appellee, for an alleged breach of contract by failing to sell securities in compliance with an order by telephone to sell. The bill was demurred to for reasons hereinafter stated and sustained by the Chancellor, and this appeal resulted.
Prior to January 17, 1968, the complainant had purchased certain stocks through the defendant, a brokerage house, including 100 shares of Kentucky Fried Chicken Corporation at 60 1/2, the certificates being issued in the name of the appellant and his wife. This transaction had been with a Mr. Brooks of the brokerage house. The bill alleges that on January 17, Mr. Lindsey called the brokerage house and discussed his stock with Mr. Brooks. After receiving Mr. Brooks' opinion that the stock would go to 100, Mr. Lindsey alleges that "he gave an order to Mr. Brooks to sell his 100 shares of Kentucky Fried Chicken Corporation at 85, and Mr. Brooks accepted same."
The bill further alleges that on January 19, following, the stock advanced above 85 and Mr. Lindsey called Mr. Brooks to inquire about the sale, at which time Mr. Brooks denied that Mr. Lindsey had placed an order to sell, but agreed to look into the matter. The transaction resulted in a final denial of the order to sell on January 31, 1968. The appellants immediately ordered the stock sold. The defendant complied by selling the stock at $64.00 per share, a total sales price of $6,400.00 less commission of $45.40. The complainants allege that they are entitled to recover the difference between $8,500.00, which the stock would have brought if sold at $85.00 per share, and the $6,400.00 because "the defendant breached his order to sell said shares of stock at 85 for a total amount of $8500.00 * * *"
To this bill the stockbroker demurred and subsequently filed an amended demurrer which in effect alleged that the contract was not in writing signed by the parties against whom enforcement was sought sufficient to indicate a sale for a stated quantity of described securities at a definite *670 or stated price as required by U.C.C. 8-319, which is T.C.A. 47-8-319; alleged that the bill showed that none of the other conditions and exceptions of said statute had been met; and alleged that the bill showed on its face that defendant had denied that a contract was made.
Excellent arguments have been made on both sides. Likewise both sides have filed very excellent and comprehensive briefs, and we, after studying all the authorities there cited, and making an independent investigation of the question due to its newness and novelty, have reached a conclusion hereinafter to be set forth.
Article 8 of the Uniform Commercial Code (hereinafter called U.C.C.) T.C.A. 47-8-319, provides:
"Statute of frauds. A contract for the sale of securities is not enforceable by way of action or defense unless
"(a) there is some writing signed by the party against whom enforcement is sought or by his authorized agent or broker sufficient to indicate that a contract has been made for sale of a stated quantity of described securities at a defined or stated price; or
"(b) delivery of the security has been accepted or payment has been made but the contract is enforceable under this provision only to the extent of such delivery or payment; or
"(c) within a reasonable time a writing in confirmation of the sale or purchase and sufficient against the sender under paragraph (a) has been received by the party against whom enforcement is sought and he has failed to send written objection to its contents within ten (10) days after its receipt; or
"(d) the party against whom enforcement is sought admits in his pleading, testimony or otherwise in court that a contract was made for sale of a stated quantity of described securities at a defined or stated price." (Emphasis supplied.)
Obviously the question presented is whether or not the contract between a stockbroker and his customer whereby the broker is engaged on a commission basis to sell stock for the customer is subject to this statute of frauds, T.C.A. 47-8-319.
After thorough research by counsel on both sides and by us, we can find only one case which is what is commonly known as a "spotted cow" case, that is, Stott v. Greengos, 95 N.J. Super. 96, 230 A.2d 154. This case is likewise reprinted by the authors of Uniform Commercial Code Reporting Service, in Volume 4 thereof, at page 215, and interprets the New Jersey Code Section, which is identical to ours, in U.C.C. 8-319. The Stott case, 230 A.2d, 154, 157, cites as supporting their conclusion twelve other cases from twelve different courts of last resort of the United States. The author of the Stott case, finding no authority pro or con in reference to U.C.C. 8-319 considers these twelve pre-U.C.C. cases as the closest to the question involved. The twelve pre-U.C.C. cases involve the question whether the statute of frauds (as codified in the uniform sale of goods law, T.C.A. 47-1204) is limited in application to "a contract to sell or sale of goods or choses in action."
The Stott opinion says that these cases hold that "where one contracts with a broker to act as his agent in purchasing stock for him, such a contract is one of agency rather than for the sale of goods, wares or merchandise. Such contract of agency is not within the statute of frauds." The case then cites the twelve cases which it is needless for us to again cite because by reading the Stott opinion they will be found. We have read each of these pre-Code cases which involve the issue of whether the broker-customer relationship is one of principal agent or seller and purchaser. Eleven of these cases support the Stott decision, the twelfth is distinguishable on its facts.
In the twelfth case, F.C. Adams v. Elmer F. Thayer Estate, 85 N.H. 177, 155 A. *671 687, 689, 691, 156 A. 697, the customer had told his broker that he wanted to purchase a particular unlisted security at a designated price. The broker was not retained on a commission basis, as he was in the Stott case, but was to purchase the stock for the lowest price that he could and then re-sell the shares to the customer at the previously designated price. Under these circumstances the court in this New Hampshire case held that the broker actually sold securities to his customer and the statute of frauds was applied to the transaction.
T.C.A. 47-8-319 establishes that, "A contract for the sale of securities is not enforceable by way of action or defense unless * * *" one of four stated conditions is met. The language of this section of the Code indicates that only contracts involving a sale of securities must meet the statute of fraud requirements. The issue to be decided may be disposed of by determining whether the contract between broker and customer is one for the sale of securities. To reach the preceding issue one must define the word "sale". T.C.A. 47-2-106 states that "A `sale' consists in the passing of title from the seller to the buyer for a price." Obviously, the contract sued on in the present case does not in any way allege a sale. All that is alleged is the simple instruction to a stockbroker by the owner of the stock to take his stock and sell it at a certain price. These facts establish not a sale but only an agency relationship.
American Law Institute Restatement of Law, 2nd Ed., on Agency at page 7 of said work defines Agency thus:
"Agency is the fiduciary relation which results from the manifestation of consent by one person to another that the other shall act on his behalf and subject to his control, and consent by the other so to act.
"(2) The one for whom action is to be taken is the principal.
"(3) The one who is to act is the agent."
Under the comments on sub-section (3) above quoted the author states at page 11 of this work that: "Thus, the attorney-at-law, the broker, the factor, the auctioneer, and other similar persons employed either for a single transaction or for a series of transactions, are agents although as to their physical activities they are independent contractors." In the Scott case, supra, a customer placed an order with his broker to purchase for him a particular stock at a price not in excess of one designated by the customer. The broker made the purchase and mailed a confirmation to the customer. Upon receipt of the confirmation of purchase the customer wrote his broker disclaiming any interest in the stock, alleging that it was purchased at a price higher than the other authorized. The broker sued the customer for the loss he took when he sold the stock.
The determinative issue was whether the contract between the customer and broker was one for the sale of securities thereby being subject to the statute of frauds. The court held in the Stott case, supra, that the contract whereby the customer authorized his broker to purchase stock for him on a commission basis is not a contract for the sale of securities but merely a contract of agency. The definition of a sale found in T.C.A. 47-2-106 and used by the New Jersey Court in the Stott case, supra, is specifically applicable only to Article 2 of the U.C.C. dealing with sales. However, the definition can certainly be adopted to apply to T.C.A. 47-8-319 since Article 8 contains no definition of sale. If the definition of "sale" contained in T.C.A. 47-2-106, above quoted, is adopted to apply to 47-8-319, T.C.A., the most important fact involved in determining whether the case presently before the Court involves a contract of sale is whether title passed from the customer to the broker and then to the ultimate purchaser, whether the broker was merely a conduit, the title never vesting in him but *672 passing directly from the seller to the customer.
It seems to this Court that the Stott decision is logically sound and clearly was within the purpose of the U.C.C. as expressed in T.C.A. 47-1-102(2), which is to bring the law governing commercial transactions into accord with actual commercial practice.
In addition to what is said in the Stott case and its holding the editors of the Uniform Commercial Code Reporting Service in volume 4, immediately preceding the reporting of the Stott case, said this (Editor's note):
"The Official Comment to 8-319 states that `Paragraph (c) (of the section) is particularly important in the relationship of broker (Section 8-303) and customer.' Cf., however, Isreals and Guttman, Modern Securities Transfer, Appx pp 70-71 (1967), where it is stated that `As between a broker and his customer the applicability of this section will depend upon whether or not the broker acts as agent, or (as in some transactions on the over the counter market), as principal sells to or purchases from his customer. * * * Where the broker acts as agent the contract between broker and customer is not `for the sales of securities.' * * * (E)ven where * * * the transaction is conducted entirely orally (perhaps entirely by telephone), the contract should be completely enforceable under the general provisions of the Statute of Frauds permitting enforcement of oral contracts performed within one year * * * In strict terms, this section would not be applicable in such a case."
Such noted teachers and authorities as Professor Willison have criticized the provision of the U.C.C. in reference to the statute of frauds as found in T.C.A. 47-2-201 as "the most iconoclastic" provision in the Code. This article by Professor Willison was written prior to the adoption of the Code by any of the States and is found in 63 Harvard Law Review 561, at page 573. About the same time others wrote praising the U.C.C. and as a whole it is unquestionably subject to great praise, but it is easy by reading again the quoted provisions herein, T.C.A. 47-8-319, to see how from a practical standpoint it would be impossible for one to call a stockbroker and tell him to buy or sell some shares of this or that and to have any writing to substantiate the telephone conversation.
The broker making notes and sending them to the customer in compliance with the second comment in T.C.A. 47-8-319 is particularly relied upon by the appellee. This question is considered not in reference to the U.C.C. but whether or not the broker's note meets the statute of frauds. A very interesting note in Willison on Sales, Vol. 1, beginning at page 337, Section 116, cites an English decision hundreds of years old, with annotations to date. Although none of the annotations are particularly applicable to the state of facts involved in the present lawsuit, the cases noted are interesting when considered in conjunction with the comment on paragraph (c) of the section here involved.
Counsel for the appellee relies greatly on Mortimer B. Burnside & Co. v. Haverner Securities Corp., 25 A.D.2d 373, 269 N.Y.S.2d 724 (1966). After a thorough study of this case we do not think that it is particularly applicable to the facts of the present case even though a statement is made in next to the last paragraph of the opinion that:
"A writing is the only other statutory protection against frauds. The purchase of stock from Friedman could have been made for any number of reasons quite apart from any promise by the defendants. It is not `unequivocally referable' to a promise to deliver the warrants. (Citing authority). The alleged agreement with the defendants therefore comes within the statute of frauds, is not enforceable and it was proper to grant *673 summary judgment dismissing the complaint."
It will be noticed that there was also the question of a sale and the court in the early part of the opinion made the statement in this case that "The first question that arises is whether this transaction contemplates a `sale'." The dissenting opinion in this case likewise states that there was no sale. In other words that was the disagreement, according to the majority there was a sale and the minority thought there was not. This is an opposite proposition to that which we have before us.
There are other cases, too, where the question of the effect of a demurrer to the declaration or the bill in these other state courts is discussed. The question was not argued whether or not it was a sale. Those opinions made the assumption that the statute did apply and the question determined there was whether or not the demurrer admitted the contract. It is not necessary for us to consider this in the present case in view of the conclusion we reached on the proposition which is determinative of this lawsuit.
Uniform Laws Annotated has gotten out a special master edition on the U.C.C. where they consider at page 674 of Vol. 2 the particular section that is involved in the present case. Six or seven cases are briefed or annotated under this section in this volume of U.L.A., but none of them other than Stott v. Greengos, supra, are in point to the question here involved.
After a very thorough consideration of the question we are satisfied that under the bill here as demurred to that the well-pleaded facts which are admitted by the demurrer as well as the reasonable and natural inferences to be drawn from these facts established that the statute of frauds, here plead and relied upon, does not apply to the present case. The result is that the decree of the Chancellor will be reversed and the case remanded for further pleading and anything necessary not in opposition to what we have said herein. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/3345317/ | [EDITOR'S NOTE: This case is unpublished as indicated by the issuing court.]
MEMORANDUM OF DECISION
According to the allegations of the complaints, the plaintiffs recorded their certificates of mechanic's liens on March 28, 1990 in R S, and June 11, 1990 in Kane. The complaints are dated November 26, 1991 and were filed on December 11, 1991. The defendant moves to dismiss in each action on the ground that the court lacks subject matter jurisdiction because plaintiffs had failed to foreclose their liens within one year as required by Connecticut General Statutes 49-40a. The plaintiffs oppose the motion, arguing that 11 U.S.C. § 108(c) tolled the one-year period since the subject property was involved in bankruptcy proceedings, eventually ending up in defendant's possession through foreclosure.
11 U.S.C. § 108(c) provides in part that if nonbankruptcy law. . .fixes a period for commencing or continuing a civil action in a court other than a bankruptcy court on a claim against a debtor. . .and such period has not expired before the date of the filing of the [bankruptcy] petition, then such period does not expire until the later of —
(1) the end of such period, including any suspension of such period occurring on or after the commencement of the case; or
(2) 30 days after notice of the termination or expiration of the stay as the case may be, with respect to such CT Page 3458 claim.
The plaintiffs maintain that this statute tolls the running of one year statute of limitation for foreclosing mechanics' liens, in this case from the time of the bankruptcy petition, December 11, 1990, until the property emerged from bankruptcy proceedings and into defendant's possession, a period of 176 days.
"Section 108 does not in and of itself suspend the running of the statute of limitations." In Re Baird, 63 B.R. 60, 63
(Bkrtcy. W.D.Ky. 1986). Subsection (c) merely "extends a creditor's right to bring an action through the pendency of a debtor's bankruptcy only for 30 days" after the stay expires. Id. The suspension referred to in 108(c)(1) is a reference to some statutes which do suspend statutes of limitations such as 6503(b) of the Internal Revenue Code. Id.
The statutes of limitations is not actually tolled, but extended by 30 days after the lifting of the stay. The property came out of bankruptcy and into defendant's possession on June 11, 1991. Title then vested in the defendant and the property would not be subject to any stay under the bankruptcy code. The plaintiffs, therefore, had 30 days from this point; 108(c)(2); to foreclose the liens. Since they waited to well after this date, the defendant's motions to dismiss is granted.
MEADOW, J.
[EDITORS' NOTE: THE CASE THAT PREVIOUSLY APPEARED ON THIS PAGE HAS BEEN MOVED TO CONN. SUP. PUBLISHED OPINIONS.] CT Page 3468 | 01-03-2023 | 07-05-2016 |
https://www.courtlistener.com/api/rest/v3/opinions/2858201/ | IN THE COURT OF APPEALS, THIRD DISTRICT OF TEXAS,
AT AUSTIN
NO. 3-92-511-CR
MANUEL RODRIGUEZ PEREZ, a/k/a CHOMPY PEREZ,
APPELLANT
vs.
THE STATE OF TEXAS,
APPELLEE
FROM THE DISTRICT COURT OF TOM GREEN COUNTY, 119TH JUDICIAL DISTRICT
NO. CR92-0349-B-1, HONORABLE DICK ALCALA, JUDGE PRESIDING
After the jury found appellant guilty of attempted capital murder, Tex. Penal Code
Ann. §§ 15.01 (West Supp. 1993) and 19.03 (West 1989 & Supp. 1993) and aggravated assault,
Tex. Penal Code Ann. § 22.02 (West Supp. 1993), the court assessed punishment, enhanced by
prior felony convictions, at confinement for fifty-five years. Appellant asserts three points of
error, contending that the trial court erred by: (1) overruling appellant's motion to suppress
evidence; (2) overruling appellant's objection to the inclusion of the definition of voluntary
intoxication in the jury charge; and (3) denying appellant's requested jury charge under Tex. Code
Crim. Proc. Ann. art. 38.23 (West Supp. 1993). We overrule appellant's points of error and
affirm the judgment of the trial court.
In his first point of error, appellant contends that the trial court erred in overruling
his motion to suppress evidence that was obtained as the result of an unlawful investigative stop.
Appellant urges that the stop and subsequent detention were the result of observations by an
officer that were just as consistent with innocent activity as with criminal behavior.
About midnight on January 27, 1992, San Angelo Police Officer Steve Quade was
on patrol in an area where a number of bars were located. Quade testified that shortly after
midnight he observed a pickup truck leaving Becky's Bar that he identified as having a connection
with an arrest on the previous night. Quade related that, the prior evening, he and a fellow officer
had arrested a man for intoxication who was about to enter this vehicle outside a nearby bar. A
check of outstanding warrants revealed that this person's driver's license had been suspended.
Quade testified that on the night in question he observed the pickup after it left the
bar "swerving approximately two feet from side to side in the outside lane, driving extremely
slow, also pumping the brakes constantly." Quade stated that the vehicle's swerve or drift was
not normal for a vehicle traveling at an "extremely slow speed." Quade related that he had
learned from experience that people who leave bars around the midnight closing hour tend to have
had more to drink than those who leave earlier.
After stopping the pickup, appellant told Quade that he did not have a driver's
license and "then he ran." Quade chased appellant until he was able to tackle him. A fight ensued
in which appellant was able to get on top of Quade with his knees positioned above Quade's waist.
Quade stated that after appellant struck him in the groin two times, he was able to reach his
portable radio and call for help. Appellant grabbed the radio and used it to strike Quade on the
top of the head and on back of the head. Quade and appellant fought for Quade's gun until
appellant was able to gain control of it. Quade testified that appellant told him that he was going
to kill him.
San Angelo Police Officer Rick Keeling responded to Quade's call for assistance.
Keeling testified that when he arrived at the scene he observed an officer "laying face down . . .
the defendant [appellant] was standing at the top of the officer's head and crouched down over the
officer." As Keeling approached the parties, appellant "stood in an upright position and raised
the firearm and pointed it in my direction at me." Keeling stated that he was in fear of his life
and fired three shots at appellant. Appellant dropped the gun and started walking slowly away
before he responded to a demand that he turn around where his hands could be observed.
Appellant contends that all evidence regarding facts that occurred after the initial
stop should have been suppressed since the officer did not have specific articulable facts which,
in light of the officer's experience and personal knowledge, together with other inferences from
these facts, would warrant an intrusion of a citizen's freedom. Appellant directs our attention to
Quade's testimony that he had not seen appellant committing any traffic violations.
In determining whether a temporary detention is justified, the pivotal issue is not
whether particular conduct is innocent or guilty, but the degree of suspicion that attaches to
particular types of noncriminal acts. Holladay v. State, 805 S.W.2d 464, 469 (Tex. Crim. App.
1991). We find the following analysis in Crockett v. State, 803 S.W.2d 308 (Tex. Crim. App.
1991), to be helpful:
Appellant contends in effect that his behavior could not have been suspicious
because it was perfectly lawful. But such circumstances as will raise suspicion that
illegal conduct is taking place need not be criminal in themselves. Rather, they
may include any facts which in some measure render the likelihood of criminal
conduct greater than it would otherwise be.
. . . .
Minor intrusions which measurably further imperative public interests in law
enforcement require relatively less confidence of wrongdoing than do more
extensive intrusions which advance law enforcement interests but little. At a
minimum, however, the suspicious conduct relied upon by law enforcement
officers must be sufficiently distinguishable from that of innocent people under the
same circumstances as to clearly, if not conclusively, set the suspect apart from
them.
Id. at 311 (citations omitted).
In the instant cause, appellant was driving a vehicle that was associated with an
arrest for intoxication the previous evening. The pickup was leaving a bar at a time when those
departing are likely to have consumed a larger amount of intoxicating beverages than those who
leave at earlier hours. Officer Quade observed the vehicle moving at an "extremely slow rate of
speed" and swerving within the lane. Also, the driver was "pumping the brakes constantly." We
hold that the officer was justified in making an investigatory stop. The evidence concerning
appellant's flight and his threats to Officers Quade and Keeling was clearly admissible.
Appellant's first point of error is overruled.
In his second point of error, appellant complains of the court's action in overruling
his objection to the inclusion of the definition of voluntary intoxication in its charge. Appellant
urges that intoxication was not an issue in the trial and points to the fact that neither appellant nor
the State requested the instruction. Appellant reasons that the charge which provided in part that
voluntary intoxication does not constitute a defense to the commission of a crime constituted a
comment on the weight of the evidence.
It is undisputed that appellant was intoxicated on the occasion in question. Dr.
Charles Benham, the emergency room physician who treated appellant following the events in
question, testified that appellant's blood alcohol level was almost twice that considered to
constitute intoxication in Texas. Dr. Benham stated that, in his opinion, appellant's alcohol level
was high enough to impair his judgment.
Evidence of temporary insanity caused by intoxication may be introduced for the
purpose of mitigation of penalty. Tex. Penal Code Ann. § 8.04(b) (West 1974). Under section
8.04(d), intoxication is defined as the "disturbance of mental or physical capacity resulting from
introduction of any substance into the body." In Williams v. State, 567 S.W.2d 507, 510 (Tex.
Crim. App. 1978), the court held that no error was shown under Penal Code section 8.04 by
virtue of the trial court charging the jury on intoxication at the guilt-innocence stage of the trial.
We perceive no error in the trial court's action in charging on intoxication in the instant cause.
Appellant's second point of error is overruled.
In his third point of error, appellant asserts that the trial court erred in denying his
requested jury instruction as to when an investigative detention is lawful. Appellant urges that
the trial court was mandated by Tex. Code Crim. Proc. Ann. art. 38.23 (West Supp. 1993), to
instruct the jury to decide whether the evidence was unlawfully obtained, and if so, to disregard
the evidence.
A trial court is required to include a properly worded article 38.23 instruction in
the jury charge only if there is a factual dispute as to how the evidence was obtained. Thomas v.
State, 723 S.W.2d 696, 707 (Tex. Crim. App. 1986); Murphy v. State, 640 S.W.2d 297, 299
(Tex. Crim. App. 1982). In the instant cause, there was no dispute as to the facts surrounding
the investigative stop and detention of appellant. Since the facts were not controverted, no
instruction was required. Appellant's third point of error is overruled.
The judgment of conviction is affirmed.
Tom G. Davis, Justice
Before Chief Justice Carroll, Justices Aboussie and Davis*
Affirmed
Filed: October 6, 1993
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) (West 1988). | 01-03-2023 | 09-05-2015 |
https://www.courtlistener.com/api/rest/v3/opinions/2743240/ | [J-93-2014]
IN THE SUPREME COURT OF PENNSYLVANIA
MIDDLE DISTRICT
IN RE: SUBSTITUTE NOMINATION : No. 119 MAP 2014
CERTIFICATE OF CHRIS ROSS AS :
REPUBLICAN CANDIDATE FOR THE : Appeal from the order of the
PENNSYLVANIA HOUSE OF : Commonwealth Court at No. 516 MD 2014
REPRESENTATIVES IN THE 158TH : dated October 3, 2014
LEGISLATIVE DISTRICT :
: SUBMITTED: October 8, 2014
SUSAN RZUCIDLO, RICHARD HICKS, :
DIANE CLAYTON, MARY LYNNE MASSI, :
JUDY PORTA, AND DAVID UNGER, :
:
Objectors :
:
CAROL AICHELE, IN HER OFFICIAL :
CAPACITY; THE PENNSYLVANIA :
DEPARTMENT OF STATE; JAMES L. :
FORSYTHE, IN HIS OFFICIAL :
CAPACITY; AND CHESTER COUNTY :
VOTER SERVICES REPUBLICAN :
COMMITTEE OF CHESTER COUNTY, :
:
Intervenor :
:
:
:
APPEAL OF: SUSAN RZUCIDLO, :
RICHARD HICKS, DIANE CLAYTON, :
MARY LYNNE MASSI, JUDY PORTA, :
AND DAVID UNGER, :
:
Objectors :
ORDER
PER CURIAM DECIDED: October 16, 2014
AND NOW, this 16th day of October 2014, the Order of the Commonwealth
Court is AFFIRMED. | 01-03-2023 | 10-16-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/2743241/ | IN THE SUPREME COURT OF PENNSYLVANIA
EASTERN DISTRICT
GUMBO BROTHERS, LLC : No. 191 EAL 2014
:
:
v. : Petition for Allowance of Appeal from the
: Order of the Superior Court
:
QUEEN'S WALK, L.P., MONTROSE :
INVESTMENTS, LLC, RICHARD KOWIT, :
MICHAEL GARNICK AND MICHAEL :
MCCANN :
:
:
v. :
:
:
MICHAEL COLAIZZO :
:
:
PETITION OF: MICHAEL COLAIZZO :
ORDER
PER CURIAM
AND NOW, this 16th day of October, 2014, the Petition for Allowance of Appeal
is DENIED. | 01-03-2023 | 10-16-2014 |
https://www.courtlistener.com/api/rest/v3/opinions/1564456/ | 16 So. 3d 813 (2009)
Hutch HAMMOND
v.
Terry LOVVORN and Sherry Lovvorn.
2070749.
Court of Civil Appeals of Alabama.
February 20, 2009.
*814 Mac M. Moorer and Ivan B. Cooper of Lightfoot, Franklin & White, L.L.C., Birmingham, for appellant.
John Keith Warren, Ashland, for appellees.
MOORE, Judge.
Hutch Hammond appeals from a judgment entered by the Randolph Circuit Court ordering him to remove a gate placed across an easement owned by Terry Lovvorn and Sherry Lovvorn. We reverse.
On June 19, 2006, the Lovvorns filed a complaint against Hammond, seeking an order determining that they owned an easement across certain real property owned by Hammond, requiring Hammond to remove a gate that he had erected across the easement, and prohibiting Hammond from interfering with their use of the easement. The parties stipulated that the Lovvorns owned an easement across Hammond's real property. As to the remaining issues, the trial court did not receive ore tenus evidence but considered only the pleadings and the written factual stipulations and briefs filed by the parties. On November 27, 2007, the trial court entered a judgment ordering Hammond to remove the gate placed across the easement and to not obstruct the free and unfettered access to the Lovvorns' property, i.e., to not interfere with the Lovvorns' use of the easement. Hammond timely appealed to this court, arguing that the trial court had erred in requiring him to remove the gate.
"When a trial judge's ruling is not based substantially on testimony presented live to the trial judge, review of factual issues is de novo. Eubanks v. Hale, 752 So. 2d 1113 (Ala.1999). `[W]here the trial court's ruling rests upon a construction *815 of facts indisputably established, this Court indulges no presumption of correctness in favor of the lower court's ruling.' Alabama Farm Bureau Mut. Cas. Ins. Co. v. Dyer, 454 So. 2d 921, 923-24 (Ala.1984). See also, Beavers v. Walker County, 645 So. 2d 1365, 1372 (Ala.1994) (`[W]here the facts are not disputed the ore tenus standard does not apply.'). `"[W]hen a trial court sits in judgment on facts that are undisputed, an appellate court will determine whether the trial court misapplied the law to those undisputed facts."' Harris v. McKenzie, 703 So. 2d 309, 313 (Ala.1997) (quoting Craig Constr. Co., Inc. v. Hendrix, 568 So. 2d 752, 756 (Ala.1990)). The ore tenus `standard's presumption of correctness has no application to a trial court's conclusions on questions of law.' Beavers, 645 So.2d at 1372. `[O]n appeal, the ruling on a question of law carries no presumption of correctness, and this Court's review is de novo.' Ex parte Graham, 702 So. 2d 1215, 1221 (Ala.1997)."
Rogers Found. Repair, Inc. v. Powell, 748 So. 2d 869, 871 (Ala.1999).
According to binding precedent from our supreme court, the owner of a servient estate may erect a gate across an easement so long as the erection and maintenance of the gate does not constitute an unreasonable burden on the owner of the dominant estate in whose favor the easement runs. See Simpson v. Harbin, 447 So. 2d 189, 191 (Ala.1984); and Self v. Hane, 262 Ala. 446, 448, 79 So. 2d 549, 551 (1955). "It is a question of reasonableness under all the circumstances." Self, 262 Ala. at 448, 79 So.2d at 551.
The material submitted to the trial court indicates that Hammond and the Lovvorns own adjoining property. A dirt road runs through Hammond's property; that dirt road provides the Lovvorns the only access to their property. The parties agree that the Lovvorns own an easement allowing them to use that dirt road. Hammond resides on the servient estate. The Lovvorns do not reside on the dominant estate. The record contains no evidence indicating how often the Lovvorns visit their property.
At some point, Hammond erected a gate across the dirt road to prevent people from accessing his property to dump their litter, as had occurred in the past. Hammond selected the location for the gate based on his observation of a cable that apparently had, at one time, stretched across the dirt road. Hammond placed a lock on the gate and offered a key to the Lovvorns, which they repeatedly refused. Instead, they filed the instant action seeking removal of the gate.
Based on our review of the evidence, we find that Hammond acted reasonably in erecting the gate to prevent dumping on his property. We also find that Hammond acted reasonably in offering the Lovvorns a key to the gate so as to allow them use of their easement. The Lovvorns did not present any evidence indicating why they refused Hammond's offer, which deems their refusal unreasonable. The Lovvorns also did not present any evidence indicating that having to unlock and open and close the gate when visiting their property constitutes an undue burden on their use of the easement, the frequency of which use is not revealed in the record. Based on the scant record before us, it appears that the burden on the Lovvorns would be negligible at worst.
Based on the foregoing, we conclude that the trial court erred in ordering Hammond to remove the gate. Thus, we reverse the trial court's judgment and remand the cause with instructions to enter a judgment allowing Hammond to maintain the gate on the condition that he *816 provide the Lovvorns with a key that allows them to open the gate.
REVERSED AND REMANDED WITH INSTRUCTIONS.
PITTMAN and THOMAS, JJ., concur.
THOMPSON, P.J., dissents, without writing.
BRYAN, J., dissents, with writing.
BRYAN, Judge, dissenting.
I must respectfully dissent. The owner of a servient estate may not unreasonably interfere with the easement holder's rights. See Blalock v. Conzelman, 751 So. 2d 2, 6 (Ala.1999). Given the factual circumstances of this case, I believe that Hammond unreasonably interfered with the Lovvorns' use of their easement by placing a gate across that easement. Therefore, I would affirm the judgment of the trial court. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4558393/ | Fourth Court of Appeals
San Antonio, Texas
MEMORANDUM OPINION
04-20-00404-CV
IN RE Aaron Michael COOK
Original Proceeding 1
PER CURIAM
Sitting: Sandee Bryan Marion, Chief Justice
Luz Elena Chapa, Justice
Beth Watkins, Justice
Delivered and Filed: August 19, 2020
PETITION FOR WRIT OF MANDAMUS DENIED
On August 12, 2020, relator filed a petition for writ of mandamus. After considering the
petition and the record, this court concludes relator is not entitled to the relief sought. Accordingly,
the petition for writ of mandamus is denied. See TEX. R. APP. P. 52.8(a).
PER CURIAM
1
This proceeding arises out of Cause No. 2019EM501414, styled In the Interest of B.M.C., a Child, pending in the
438th Judicial District Court, Bexar County, Texas. The Honorable Norma Gonzales signed the order at issue in this
original proceeding. | 01-03-2023 | 08-25-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1565244/ | 433 S.W.2d 928 (1968)
Mayme Sue MARSH, Appellant,
v.
ORVILLE CARR ASSOCIATES, INC., Appellee.
No. 14703.
Court of Civil Appeals of Texas, San Antonio.
October 16, 1968.
Rehearing Denied November 20, 1968.
*929 Paul M. Green, Lang, Cross, Ladon, Oppenheimer & Rosenberg, San Antonio, for appellant.
Paul E. Casseb, Harry J. Burns, San Antonio, for appellee.
KLINGEMAN, Justice.
This is an appeal from a judgment non obstante veredicto entered in favor of Orville Carr Associates, Inc., hereinafter called Carr, against Mayme Sue Marsh, hereinafter called Mrs. Marsh, in a suit on a sworn account to recover the purchase price of merchandise sold to Mrs. Marsh by Carr.
Mrs. Marsh had leased an apartment in Olmos Towers, a new high-rise apartment building in San Antonio, in July, 1965, to be effective upon completion of construction approximately in February, 1966. She desired to furnish said apartment. Carr is an interior decorating firm, and sometime in November, 1965, Mrs. Marsh went to the Carr studios and became particularly interested in a French armoire on display. Although she did not purchase such item on her first visit, she subsequently returned and arrangements were made with Mr. Jerry Stewart, an interior *930 decorator associated with Carr, to furnish and decorate Mrs. Marsh's Olmos Tower apartment. On December 16, 1965, Mrs. Marsh deposited $2,000.00 with Carr to be applied on merchandise to be sold and delivered to her on account. Thereafter, over a period of several months, various items of furniture, draperies, and other household accessories, including the French armoire, were purchased by Mrs. Marsh, and most of such items were delivered in April, 1966, when Mrs. Marsh moved into her apartment, although certain items were ordered and never delivered. During the latter part of April, 1966, a bill was sent to Mrs. Marsh by Carr and subsequently other bills were rendered to Mrs. Marsh but no payments were made thereon. Sometime prior to June 22, 1966, Mrs. Marsh decided to move out of such Olmos apartment, which Carr became aware of, and on June 22, 1966, Carr sent Mr. Stewart to Mrs. Marsh's apartment and requested payment in full or return of the merchandise. Upon Mrs. Marsh's refusal to pay such account, Stewart prepared and presented to Mrs. Marsh a note giving Carr permission to remove "its merchandise" from her apartment and Mrs. Marsh signed it. Thereafter, with minor exceptions, chiefly wall paper and other affixed items, all of the merchandise was removed from Mrs. Marsh's apartment and placed in Carr's warehouse where it has remained, with the exception of various items which were sold by Carr.
Only one Special Issue was submitted to the jury, to-wit:
"QUESTION NO. 1
Do you find from a preponderance of the evidence that the Plaintiff, ORVILLE CARR ASSOCIATES, INC., by its conduct agreed to a rescission, as that term is defined herein, of the sale?
Answer `Plaintiff did agree' or `Plaintiff did not agree'.
We, the jury answer: Plaintiff did agree.
In connection with the foregoing question, you are instructed that the term `rescission' means `the undoing of a thing' and the placing of the parties to it in status quo. You are further instructed that the consent of the parties to the rescission of a sale of property may be implied from acts or conduct with reference to their dealings with the property, and need not be shown by an express agreement."
No objection to such special issue was made by Carr.
By her first and second points of error Mrs. Marsh asserts that the trial court erred in granting judgment non obstante veredicto because there was sufficient evidence to support the submission of such special issue and to support the jury's answer thereto.
To support the action of a trial court in granting a judgment non obstante veredicto "it must be determined that there is no evidence on which the jury could have made the findings relied upon. In acting upon such motion all testimony must be considered in a light most favorable to the party against whom the motion is sought and every reasonable intendment deducible from the evidence is to be indulged in such party's favor." Leyva v. Pacheco, 163 Tex. 638, 358 S.W.2d 547 (1962); Green v. Texas Employers' Ins. Ass'n, 339 S.W.2d 368 (Tex.Civ.App.Texarkana 1960, writ ref'd n. r. e.); Zachry v. McKown, 326 S.W.2d 227 (Tex.Civ.App. Austin 1959, writ ref'd n. r. e.).
Carr maintains that the trial court did not err in granting judgment non obstante veredicto because there was no evidence to support either the submission of such special issue to the jury or the jury's answer thereto. It further asserts that as a matter of law the defense of rescission was not available to Mrs. Marsh because the undisputed evidence shows that the parties could not have been restored to their original status quo.
*931 "The rescission of a contract by mutual consent does not require a formal agreement or release, but may result from any act or any course of conduct of the parties which clearly indicates their mutual understanding that the contract is abrogated or terminated, or from the acquiescence of one party in its explicit repudiation by the other.' 2 Black, Rescission and Cancellation, § 528, p. 1244. "The consent of parties to the rescission of a contract may be implied from the circumstances of the case and from their dealings with reference to the subject matter of the contract, and need not be shown by an express agreement. Thus, for instance, if the seller of goods receives back the property sold and retains it, without objection and without notifying the buyer that he refuses to accept it or that he will hold it subject to his order or as his property, his consent to a rescission of the sale will be presumed." Black, supra, § 526, p. 1240. "When goods have been delivered to the buyer under a contract of sale, and he returns them to the seller, and the latter accepts the redelivery, and resumes and retains possession of the property as his own, and does not notify the buyer that he intends to hold it subject to his order or sell it for his account, the transaction operates as a complete rescission of the contract of sale. And it appears to be immaterial, in respect to the application of this rule, whether the purchaser assigns any reasons for returning the goods, or what his specified reasons may be, * * *. For his return of the goods is an offer of rescission, and the acceptance and retention of them by the seller is an acceptance of that offer, and thereupon a rescission is effected, not necessarily for legally sufficient cause, but by the mutual consent of the parties. * * * As to the conduct of the seller in a transaction of this kind, it is not necessary that he should explicitly consent to a rescission of the contract. It is enough if he retains the property returned to him without giving the buyer any notice that he does not accept it or will not resume ownership. Nor is it necessary that the buyer should take the initiative. The same effect of a rescission follows if the seller takes possession of the property claiming it as his own, without objection from the purchaser, * * *." Black, supra, § 531, pp. 1251-52. In Lynch v. Davidson & Co. v. Denman Lumber Co., 270 S.W. 225 (Tex. Civ.App.Texarkana 1923, writ dism'd), it was held that "where the seller without legal justification and on his own volition takes back into his possession and control the property sold and delivered, and holds it subject to his order or as his property, or takes steps which are inconsistent with a completed sale and delivery of the property continuing in force, his assent to a rescission of the sale can be presumed." And if the buyer expressly consents or acquiesces in resumption of possession of the property by seller, rescission or abrogation is effected by mutual consent. See also 50 Tex.Jur.2d Sales § 89.
Mr. Orville Carr testified that there was a sale and delivery of the merchandise to a customer who had made a deposit with Carr and to whom credit was extended; that he did not make any agreement with Mrs. Marsh at the time of delivery of such goods that he reserved the right to retake possession of the merchandise. He further testified that after he became aware that Mrs. Marsh was dissatisfied with her apartment he became worried about not having received any payments from Mrs. Marsh, and on June 22, 1966, he sent Mr. Jerry Stewart to Mrs. Marsh's apartment to request an immediate payment for the merchandise or permit it to be returned to his studio. After Mrs. Marsh refused to make immediate payment, Stewart prepared the writing[1] which Mrs. Marsh signed, giving her consent to Carr's removal of *932 the merchandise. Thereafter Carr removed most of the merchandise from the apartment, except certain items which consisted primarily of those affixed to the premises, or items fabricated in the property formerly owned by Mrs. Marsh. The merchandise removed was placed in Carr's warehouse and has remained there since, except for some items which were sold by Carr. Mrs. Marsh testified that Carr repossessed the merchandise and that it was not her merchandise. Although both Mrs. Marsh and Mr. Carr testified that Mrs. Marsh at no time personally requested or authorized Carr to make sale of such merchandise, it is undisputed that several thousands of dollars of the merchandise was thereafter sold by Carr. Mr. Carr testified that he relied upon authority from Mrs. Marsh's attorney, specifically a letter from him dated July 14, 1966. This letter refers only to possible sales thereafter. It appears from the record that the French armoire which cost $1,200.00, and which was the item of furniture that Mrs. Marsh was particularly fond of and around which much of the furniture was designed, was sold sometime between June 22, 1966, and July 6, 1966, prior to said letter of July 14, 1966.
It is our opinion that there is sufficient evidence to support the submission of such special issue to the jury, and to support the jury's answer thereto.
In regard to Carr's contention that as a matter of law the defense of rescission was not available to Mrs. Marsh because the undisputed evidence discloses that the parties could not have been returned to their original status quo, a distinction must be made between involuntary rescission and voluntary rescission or rescission by mutual agreement. While as a general rule to obtain a rescission a party must either restore or offer to restore to the other party all that he has received under the contract (13 Tex.Jur.2d, § 341, p. 613; 2 Black, supra, § 616), there are certain exceptions to this rule. As stated in Black, supra, § 616, "the rule does not apply in cases where the contract is rescinded by the mutual consent or agreement of the parties, since, in such cases, they are at liberty to arrange their own terms, * * *." In Corbin on Contracts, § 1236, Discharge by Rescission, p. 540, it is stated: "If the existing agreement that is the subject of rescission is still a bilateral contract, each of the parties has one or more rights under the contract to be given up, as well as one or more duties under it from which to be discharged. In such a case a mutual assent to a rescission is at once operative to discharge both parties. This is true even though the original contract that is the subject of rescission has been partly performed by one or by both parties thereto. Each of them still has certain advantages under the contract to give up; and by analogy with the doctrine of consideration in the formation of contracts, there is no requirement that each of the parties should have the same amount to give up or that the rescission should be equally advantageous to both parties."
The record sufficiently establishes all the necessary elements of a mutual voluntary rescission and the trial court erred in granting judgment non obstante veredicto.
Mrs. Marsh also asserts that the court erred in not granting her motion for judgment and that this Court should render judgment in her favor. Mrs. Marsh, with her motion for judgment, submitted a proposed judgment which provides for a take-nothing judgment as to Carr against her and decrees that judgment be entered for Mrs. Marsh against Carr in the sum of $1,259.38. Mrs. Marsh, in addition to her answer, filed a cross-action alleging that she had made a deposit of $2,000.00 with *933 Carr in connection with the purchase of merchandise, that such sum had never been returned to her, that upon rescission of such contract and repossession of the bulk of the merchandise Carr became indebted to her for said sum of $2,000.00, save and except an offset to Carr for the value of the items remaining in Mrs. Marsh's possession which Carr did not remove, and a reasonable sum for the rental value of the other goods, wares and merchandise for the period of time Mrs. Marsh had possession of them. No special issues were requested or submitted to the jury in connection with Mrs. Marsh's cross-action.
It is the decision of this Court that there was a mutual voluntary rescission of such sale, in which Carr gave up certain rights and benefits, to-wit, the right to sue for its entire account, and received certain benefits, to-wit, the return of such merchandise as it desired to remove, and Mrs. Marsh also gave up certain rights and benefits, to-wit, the right to retain all of the merchandise, and received certain benefits, to-wit, a cancellation of the amount owing on her open account. Prior to the time that Mrs. Marsh agreed to the removal of such merchandise, she had received a bill from Carr, dated April 20, 1966, in the total amount of $15,053.04 with a credit thereon of $2,000.00 for the deposit made, leaving a net balance owing of $13,053.04. This was the status on June 22, 1966, when Carr demanded payment of its bill or return of the merchandise. Mrs. Marsh accepted such offer by refusing to pay such account and agreeing to the return of the merchandise, and there is nothing in the record to indicate that any reference or agreement was made pertaining to the return of said sum of $2,000.00.
The judgment of the trial court is reversed and judgment here rendered that Carr take nothing against Mrs. Marsh, and that Mrs. Marsh take nothing against Carr. All costs are adjudged against Carr.
NOTES
[1] "June 22, 1966
I hereby give Orville Carr Associates authority/permission to have their merchandise removed from my apartment, No. 903 Olmos Tower, in my absence.
(Signed) MAYME SUE MARSH" | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4515688/ | NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS MAR 12 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
DAMON J. CLAIBORNE, No. 18-36023
Plaintiff-Appellant, D.C. No. 3:15-cv-01192-BR
v.
MEMORANDUM*
RYAN D. MCCARTHY, Acting Secretary
of the Army,
Defendant-Appellee.
Appeal from the United States District Court
for the District of Oregon
Anna J. Brown, District Judge, Presiding
Argued and Submission Withdrawn December 11, 2019
Resubmitted March 12, 2020
Seattle, Washington
Before: GRABER and GOULD, Circuit Judges, and EZRA,** District Judge.
Plaintiff Damon J. Claiborne appeals the district court’s grant of summary
judgment in favor of the Secretary of the Army. The district court upheld the
Army’s administrative determination to involuntarily separate Plaintiff just months
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable David A. Ezra, United States District Judge for the
District of Hawaii, sitting by designation.
before he qualified for retirement benefits. On de novo review, Garris v. FBI, 937
F.3d 1284, 1291 (9th Cir. 2019), we affirm.
1. The decision by the Army to discharge Plaintiff was not illegally
retroactive. Plaintiff could have been discharged under preexisting regulations
promulgated by the Army, such as Army Regulation 635-200, because those
regulations allow the Army to change its mind about separation decisions.
Furthermore, a dismissal from the Army is not a criminal penalty, so double
jeopardy principles are not at issue.
2. Plaintiff waived the argument that the new rule was facially void, as
distinct from whether the new rule was being applied retroactively in an improper
way. Plaintiff conceded the issue below, and the district court relied on that
concession. The district court ruled that Plaintiff abandoned his claim that Army
Directive 2013-21 and ALARACT should be invalidated under the APA. The
court did not err in concluding that this argument was waived.
3. The Army discharged Plaintiff for his conviction of child molestation, not
for a generalized “proclivity” for sexual misbehavior. The Army Board for
Correction of Military Records used the word “proclivity” once in its decision, but
a single appearance of that word did not change the clear basis of the Army’s
decision. Furthermore, the Army’s real ground for discharging Plaintiff (his felony
2
conviction) was supported by substantial evidence.
AFFIRMED.
3 | 01-03-2023 | 03-12-2020 |
https://www.courtlistener.com/api/rest/v3/opinions/1564073/ | 16 So. 3d 439 (2009)
Dwain RAYMOND
v.
VIDEO INSPECTION SERVICES, INC. and XYZ Insurance Company.
No. 09-CA-38.
Court of Appeal of Louisiana, Fifth Circuit.
June 23, 2009.
Rehearing Denied July 27, 2009.
*440 Anthony S. Taormina, Attorney at Law, Metairie, LA, for Appellee, Dwain Raymond.
Musa Rahman, Attorney at Law, Baton Rouge, LA, for Intervenor/Appellant, Louisiana Workers' Compensation Corporation.
Panel composed of Judges SUSAN M. CHEHARDY, WALTER J. ROTHSCHILD, and JEROME M. WINSBERG, Pro Tempore.
CHEHARDY, Judge.
On June 12, 2002, Dwain Raymond (hereinafter "Raymond") was injured while in the course and scope of his employment. Raymond was injured when he fell into a three-foot deep hole in the ground excavated to allow plumbers to inspect underground pipes at the apartment complex where Raymond was employed. Pursuant to a workers' compensation policy issued to Raymond's employer, Louisiana Workers' Compensation Corporation (hereinafter "LWCC") made workers' compensation payments to Dwain Raymond.
On June 11, 2003, Raymond filed a lawsuit against several defendants alleging that their negligence caused his injury and resultant damages. Raymond did not notify his employer or LWCC that he had instituted a lawsuit to recover for his injuries. When LWCC did learn of the pending negligence suit, LWCC intervened pursuant to La. R.S. 23:1102(A)(1), seeking reimbursement for workers' compensation benefits paid to Raymond.
On August 20, 2008, Raymond, LWCC, and the defendant's insurer, with their respective attorneys, attended a mediation conference. An agreement entitled "Memorandum of Settlement Agreement" was reduced to writing and duly executed by all parties and their counsel. The agreement reads, in pertinent part:
THE ABOVE REFERENCED MATTER WAS MEDIATED ON THE 20[SIC] DAY OF AUGUST, 2008, AND A SETTLEMENT WAS REACHED. THE TERMS ARE AS FOLLOWS:
In full and final settlement of all claims against all defendants and defendants-in-intervention in the above referenced suit, arising out of 6/12/02 accident at 650 Central Avenue, Metairie, LA. Hanover Insurance Co. on behalf of National Economy Plumbers, Inc. agrees to pay $150,000.00 total, of which Dwain Raymond will be paid $120,000.00 and LWCC will be paid $30,000.00 subject to OWC approval. Hanover to pay Dwain Raymond's 1/3 cost of mediation.
Furthermore, attached to the agreement is an Addendum, which reads:
Out of this settlement, LWCC accepts $30,000.00 in satisfaction of its lien. Plaintiff agrees to give LWCC and employer a full and final release of all claims effective Aug. 20, 2008. LWCC will remain responsible for any outstanding medical bills if authorized and duly pre-certified by LWCC.
Surprisingly, Raymond's attorney filed a Motion to set "Moody fees"[1] on Raymond's *441 behalf on September 15, 2008. On October 6, 2008, LWCC filed an Exception of Res Judicata and Motion to Enforce Settlement. At the hearing on October 14, 2008, the trial judge denied LWCC's exception and granted Raymond's Motion for Moody fees of $7,500.00, which is 25% of LWCC's $30,000.00 settlement.
On appeal, LWCC asserts two assignments of error, which attack the award of Moody fees to Mr. Taormina. Finding merit in its criticism of the Moody award, we reverse and render.
The assessment of Moody fees is provided for in La. R.S. 23:1103(C)(1) which reads, in pertinent part:
"If . . . the employer . . . intervenes in the third party suit filed by the other, the intervenor shall only be responsible for a share of the reasonable legal fees and costs incurred by the attorney retained by the plaintiff, which portion shall not exceed one-third of the intervenor's recovery for prejudgment payments.. . . The amount of the portion of attorney fees shall be determined by the district court based on the proportionate services of the attorneys which benefited or augmented the recovery from the third party. . . . Costs shall include taxable court costs as well as the fees of experts retained by the plaintiff. The pro rata share of the intervenor's costs shall be based on intervenor's recovery of prejudgment payments. . . ."
An exception of res judicata is the proper procedural vehicle when a suit is barred by a valid written compromise or transaction. Brown v. Drillers, Inc., 630 So. 2d 741 (La. 1994).
La. R.S. 13:4231 defines res judicata as follows:
Except as otherwise provided by law, a valid and final judgment is conclusive between the same parties, except on appeal or other direct review, to the following extent:
(1) If the judgment is in favor of the plaintiff, all causes of action existing at the time of final judgment arising out of the transaction or occurrence that is the subject matter of the litigation are extinguished and merged in the judgment.
(2) If the judgment is in favor of the defendant, all causes of action existing at the time of final judgment arising out of the transaction or occurrence that is the subject matter of the litigation are extinguished and the judgment bars a subsequent action on those causes of action.
(3) A judgment in favor of either the plaintiff or the defendant is conclusive, in any subsequent action between them, with respect to any issue actually litigated and determined if its determination was essential to that judgment.
The party who urges the exception of res judicata bears the burden of proving its essential elements by a preponderance of the evidence. State, Dept. of Social Services v. Matthews, 615 So. 2d 1112 (La. App. 5 Cir.1993) (citations omitted). The burden of proof in the present case is clearly on LWCC to establish the requisites for a valid compromise, including the parties' intent to settle the differences being asserted in the action in which it is interposed. Brown v. Drillers, Inc., supra.
After a careful review of the entire record, we find that the trial court was manifestly erroneous in denying LWCC's exception of res judicata and awarding Moody fees to Mr. Taormina. The agreement clearly states that the agreement is in "full and final settlement of all claims against all defendants and defendants-in-intervention" and "plaintiff agrees to give LWCC . . . a full and final release of all claims effective Aug. 20, 2008." We find *442 that LWCC bore its burden of establishing a full compromise sufficient to establish a valid and final judgment. Accordingly, the judgment awarding Moody fees is vacated and LWCC's exception of res judicata is granted. Costs to be paid by Anthony Taormina.
REVERSED AND RENDERED.
NOTES
[1] See, Moody v. Arabie, 498 So. 2d 1081 (La. 1986), as adopted and codified by La. R.S. 23:1103(C). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564082/ | 16 So. 3d 1042 (2009)
Sharyn TURCHIN, Appellant,
v.
Todd TURCHIN, as co-personal representative of the Estate of Leslie Turchin, and Tara Turchin Latona, as co-personal representative of the Estate of Leslie S. Turchin, Appellees.
No. 4D08-3388.
District Court of Appeal of Florida, Fourth District.
September 9, 2009.
*1043 Gary A. Woodfield and C. Cory Mauro of Edwards Angell Palmer & Dodge LLP, West Palm Beach, for appellant.
Allison Grant and Andrew M. Dector of Shapiro, Blasi, Wasserman & Gora, P.A., Boca Raton, for appellees.
DAMOORGIAN, J.
Sharyn Turchin appeals from the trial court's order granting final summary judgment. We write only to address whether the trial court erred in failing to apply a gift presumption when the property was acquired by Leslie Turchin and Sharyn Turchin, as husband and wife. We find no merit to the other issues raised.
Sharyn and Leslie Turchin married in 1987. In order to protect their premarital assets, both parties entered into an antenuptial agreement. During the course of the marriage, Leslie Turchin acquired two residences identified as the Coconut Isle and Aqua Vista properties. He acquired each property with his premarital assets and took title to each in his and his wife's name. Both properties were subsequently sold during the marriage. The proceeds from the sale of the Coconut Isle property were deposited in the parties' joint checking account. Thereafter, the husband withdrew most of the funds in order to satisfy his personal obligations with the balance of the withdrawn funds being deposited in the husband's individual bank account. As part of the purchase price of the Aqua Vista property, the buyers executed a mortgage in favor of both the husband and wife. In January of 2006, Leslie Turchin died testate. The Leslie Turchin Trust directed, among other *1044 things, that the remaining balance on the Aqua Vista mortgage be forgiven.
Approximately six months later, Sharyn Turchin filed a claim against the Estate of Leslie S. Turchin seeking all of the proceeds from the sale of the Coconut Isle property and all gains realized from the reinvestment of those proceeds. In her complaint, she asserted that she was entitled to the proceeds of the sale of the property because the property was titled in both names and, therefore, there was a presumption that her husband intended to gift the property to her. Accordingly, she argued that she was entitled to the proceeds of the sale notwithstanding the fact that most of the proceeds were used by the husband or deposited in his individual account. With respect to the Aqua Vista property, Sharyn Turchin commenced a foreclosure proceeding against the mortgagors, demanding immediate payment of the mortgage. Although the Trust provided that the mortgage was forgiven, the mortgagors paid the balance with a reservation of rights. The Estate then counterclaimed, seeking declaratory relief with respect to the Aqua Vista mortgage and to impose a constructive trust over the balance paid.
Both parties moved for summary judgment in connection with the proceeds from the sale of the Coconut Isle property and the right to the proceeds from the satisfaction of the Aqua Vista mortgage. After a hearing on the motions, the trial court held that Sharyn Turchin, under the terms of the antenuptial agreement, was entitled to only one-half of the proceeds from the sale of the Coconut Isle property that were left in the parties' joint account. With respect to the proceeds from the satisfaction of the Aqua Vista mortgage, the trial court, again relying upon the terms of the antenuptial agreement, ruled that she had no right to or interest in the proceeds.
Sharyn Turchin now appeals, arguing, among other things, that the trial court erred in failing to apply a gift presumption when the properties were jointly titled in the names of husband and wife. Although Sharyn Turchin is correct that a gift is presumed under Florida law when property is purchased by one spouse but placed in both names, this presumption does not apply when the antenuptial agreement specifically designates how the jointly held property is to be distributed. See Bowen v. Bowen, 345 S.C. 243, 547 S.E.2d 877, 881 (2001); cf. Hannon v. Hannon, 740 So. 2d 1181, 1187 (Fla. 4th DCA 1999) ("As a general matter, the provisions in chapter 61 on alimony do not exist to displace nuptial agreements; rather the statutes exist to set the principles when there is no agreement."). "A primary purpose of an [antenuptial] agreement is to modify or shrink the general discretion of [a] judge in doing equity between the parties. The agreement itself is intended to define the mutual equities, and the trial judge is not free to ignore its provisions or to render them ineffective." Hannon, 740 So.2d at 1187. Because the antenuptial agreement in this case unambiguously provided for the manner of distribution of jointly held property based upon who funded the acquisition, the presumption does not apply. Accordingly, the trial court properly declined to apply the gift presumption. We therefore affirm.
Affirmed.
GERBER and LEVINE, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564123/ | 616 S.W.2d 809 (1981)
STATE of Missouri, Respondent,
v.
Arthur F. STRUBBERG, Appellant.
No. 62104.
Supreme Court of Missouri, En Banc.
May 11, 1981.
Rehearing Denied June 8, 1981.
*812 Frank K. Carlson, Public Defender, Union, for appellant.
John Ashcroft, Atty. Gen., Edward F. Downey, Asst. Atty. Gen., Jefferson City, for respondent.
As Modified On Court's Own Motion.
WELLIVER, Judge.
Arthur Strubberg was convicted of assault with intent to kill with malice aforethought in violation of § 559.180, RSMo 1969, and sentenced to a term of thirty years imprisonment.[1] On appeal, the Missouri Court of Appeals, Eastern District, affirmed his conviction. The case was transferred to this Court for the purpose of reexamining the existing law on the use of limiting instructions under Missouri's Mental Responsibility Law and instructions on lesser included offenses. Rule 83.03. We review as on original appeal. Mo.Const. Art. V, § 10; Rule 83.09.
Appellant contends that the trial court erred: (I) in failing to give MAI-CR 2.36; (II) in failing to instruct on the lesser included offenses of mayhem in certain circumstances and common assault, § 559.210, RSMo 1969, and § 559.220, RSMo 1969, respectively; (III) in failing to declare a mistrial for improper remarks by the prosecutor during closing argument; (IV) in refusing to allow certain questions on redirect; and (V) in admitting into evidence information gathered during a police interrogation when appellant had not been read his Miranda rights immediately prior to the interrogation. We agree with the court of appeals that appellant's conviction should be affirmed.
On February 11, 1977, Josephine Noelker drover her car to a park in Union, Missouri, to eat lunch. She was seated on the driver's side of the front seat when appellant opened the door of her car, held the cutting edge of a knife to her throat, and said, "Don't scream, I've got a knife, I'll stab you." Appellant got into the car and attempted to climb over Mrs. Noelker to sit in the passenger's seat. As he was making this move, it was necessary to remove the knife from Mrs. Noelker's neck, and she escaped. Appellant subsequently was arrested and given his Miranda warnings, which he said he understood. He confessed the attack on Mrs. Noelker to Officer Brune. Officer Brune testified appellant told him his reason for committing the attack was "seeing blood in his mind" and "feeling that he had to kill somebody." Appellant pled not guilty at his arraignment. These facts are not in dispute. Appellant concedes in his brief that "[d]efendant's capacity to form the intent to kill ... was the only real factual issue in the case...."
I
Prior to trial, on motion made pursuant to § 552.020.2, RSMo Supp.1975, appellant was granted a court ordered psychiatric examination to determine his fitness to stand trial. The report of Dr. Crane, the examining psychiatrist, shows: (1) that appellant suffers from mild retardation that has existed since birth; (2) that appellant understands the proceedings against him and is able to assist in the preparation of his defense; and (3) that appellant knew and appreciated the nature, quality, and wrongfulness of his conduct and was capable of conforming his conduct to the requirements of law.
At trial appellant called Dr. Crane as his sole witness in an attempt to prove "diminished mental capacity" or "partial responsibility."[2]*813 On direct, Dr. Crane testified in more detail regarding his examination and the conclusions reflected in his report. He said that appellant suffered from the mental defect of mild retardation, that he had received very little supervision as he was growing up, and that he had a history of drinking, stealing, firesetting, and fighting. Dr. Crane testified that it was his opinion that appellant at times acted out of impulse, and when doing so thought little about the consequences of his acts before he did them. While defense counsel was able to get the psychiatrist to say that it was his impression that appellant "did not have that intent [to kill]", on cross examination the doctor reiterated the opinion expressed in his report that appellant did "know and appreciate the nature, quality and wrongfulness of his conduct and was capable of conforming his conduct to the requirements of law." Appellant now contends that pursuant to § 552.030.6, RSMo 1969, the jury should have been instructed that the information Dr. Crane received during his examination was "admitted solely on the issue of the mental condition of the defendant at the time of the offense charged against him... [and should not be used] as evidence that defendant did or did not commit the acts charged against ... [him]." MAI-CR 2.36. Appellant neither offered nor requested MAI-CR 2.36 at the time of trial and now contends that the giving of the instruction was mandatory.
In order to rule upon appellant's contention, it is necessary to examine all relevant sections of our Mental Responsibility Law relating to court ordered examinations, including the historical background of these sections.
The Missouri Mental Responsibility Law was for the most part patterned after the Model Penal Code (1962). See State v. Anderson, 515 S.W.2d 534, 538 (Mo. banc 1974); Richardson, Reardon, & Simeone, Missouri's Mental Responsibility Law, A Symposium, 19 J.Mo.Bar 645 (1963).
Missouri's Mental Responsibility Law, like the Model Penal Code, makes provision for two types of pre-trial, court ordered psychiatric examinations. Missouri provides for these examinations in § 552.020.2, RSMo Supp. 1975, (hereinafter referred to as an ".020 examination") and § 552.030.4, RSMo 1969, (hereinafter referred to as an ".030 examination"). The purpose of the .020 examination is to determine the fitness of the accused to stand trial. The purpose of the .030 examination is to help determine the availability to the accused of the defense of not guilty by reason of mental disease or defect which will excuse responsibility for the acts charged.
The .020 examination is ordered almost as a matter of routine upon request of the state or the accused or upon the trial court's own motion. See Bryant v. State, 563 S.W.2d 37 (Mo. banc 1978). The .030 examination is only ordered upon motion of the state or the accused after the accused has chosen to rely on the defense of not guilty by reason of mental disease or defect excluding responsibility for the acts charged. *814 Sections 552.030.2, RSMo 1969, and § 552.030.4, RSMo 1969, require that the defendant do one of two things before a motion for an .030 examination can be granted. The defendant must either, (1) at the time of pleading enter a plea of not guilty by reason of mental disease or defect excluding responsibility; or, (2) within ten days after a plea of not guilty or in the trial court's discretion at a later date after good cause is shown, file a written notice of an intention to rely on such defense. The state may accept the plea, thereby triggering treatment procedures contained in § 552.040, RSMo 1969, or the state may refuse to accept the plea. If the state refuses to accept the defendant's not guilty by reason of mental disease or defect plea, then the trial court is required to order the .030 examination upon the motion of either party[3] to help determine the availability of the defense of not guilty by reason of mental disease or defect excluding responsibility for the acts charged.
The Model Penal Code has but a single section, § 4.09, dealing with the admissibility of information received during either the .020 type examination or the .030 type examination. It is in substantially the same form as § 552.030.6, RSMo 1969, upon which appellant relies.
In this respect, our legislature deviated from the format of the Model Penal Code and created two separate sections relating to admission of evidence obtained by the physician during these examinations. In the section relating to the .020 examination, § 552.020.9, RSMo Supp.1975,[4] the General Assembly provided and stated in part:
No statement made by the accused in the course of any examination or treatment pursuant to this section and no information received by any physician or other person in the course thereof, ... shall be admitted in evidence against the accused on the issue of guilt in any criminal proceeding then or thereafter pending in any court, state or federal.
(Emphasis added.) In the section relating to the .030 type examination, § 552.030.6, RSMo 1969, the General Assembly provided and stated in part:
No statement made by the accused in the course of any such examination and no information received by any physician or other person in the course thereof, ... shall be admitted in evidence against the accused on the issue of whether he committed the act charged against him in any criminal proceeding then or thereafter pending in any court, state or federal. The statement or information shall be admissible in evidence for or against him only on the issue of his mental condition, whether or not it would otherwise be deemed to be a privileged communication. If the statement or information is admitted for or against the accused on the issue of his mental condition, the court shall both orally at the time of its admission and later by instruction inform the jury that it must not consider such statement or information as any evidence of whether the accused committed the act charged against him.
(Emphasis added.)
The .020 examination is ordered solely for the purpose of determining fitness of the defendant to stand trial. The public policy against subjecting to trial those who are by reason of mental disease or defect unfit to stand trial is based as much on the interest of the state (the people) as it is on the interest of either of the parties to the trial itself. The examination is directed primarily at the condition of the accused at time of trial. The condition of the accused at the time of the acts charged is no more at issue than any other fact recited in the medical history of the person being examined. The wording of § 552.020.9 indicates that the legislature set up what appears to be an absolute bar against admission of any statement made by the accused or evidence obtained during the .020 examination on the *815 issue of guilt. Nothing relating to the mental condition of the accused appears to be admissible. Having so barred the statements made in this examination, the legislature made no provision for a limiting instruction in this subsection of the act.
When the accused has chosen to avail himself of the defense of not guilty by reason of mental disease or defect excluding responsibility and has taken the steps required to either cause an .030 examination to be ordered by the court or to make himself entitled to use is .020 examination as an .030 examination, he has also waived the physician-patient privilege provided for in § 491.060(5), RSMo 1969. State v. Swineburne, 324 S.W.2d 746, 750 (Mo. banc 1959); State v. Speedy, 543 S.W.2d 251, 256 (Mo. App.1976). Section 552.030.6, makes specific provision for the waiver of the physician-patient privilege stating: "The statement or information shall be admissible in evidence for or against him, [the accused] only on the issue of his mental condition, whether or not it would otherwise be deemed to be a privileged communication." With the entering of the plea and the waiver of the privilege, the bars are down. The mental condition of the accused at the time of the acts charged is an issue in the trial.
The General Assembly has specifically provided that the trial court may treat the .020 examination as the .030 examination. Section 552.030.4 provided in part:
If an examination provided in section 552.020 was made and the report thereof included an opinion whether at the time of the alleged criminal conduct the accused, as a result of mental disease or defect, did not know or appreciate the nature, quality or wrongfulness of his conduct or as a result of mental disease or defect was incapable of conforming his conduct to the requirements of law, such report may be received in evidence, and no new examination shall be required by the court unless, in the discretion of the court, another examination is necessary.
As a practical matter, we are sure there are other instances where the parties and the court, by agreement, treat the .020 examination as the .030 examination, whether or not it contains the specified statement mentioned in the statute. In any case in which the defendant shows that his .020 examination is being treated by the court as an .030 examination, then evidence obtained through that examination is entitled to all safeguards afforded any other .030 type examination. Our legislature in § 552.030.6 did make provision for and mandated that the limiting instruction must be given both in writing and orally at the time of admission of any statement made by the accused or admission of any evidence against the accused which was obtained during any .030 type examination.
The problem arises when the accused, as appellant has done here, seeks to rely on the doctrine of partial responsibility or diminished capacity and introduces evidence obtained during the .020 examination.
Section 552.030.3, RSMo 1969, is our statutory embodiment of the doctrine of partial responsibility or diminished capacity,[5] and provides in part:
3. Evidence that the defendant did or did not suffer from a mental disease or defect shall be admissible
(1) To prove that the defendant did or did not have a state of mind which is an element of the offense; or ...
This would appear to be in direct conflict with the absolute bar provided in § 552.020.9, relating to the .020 examination. This Court's primary responsibility is to ascertain the intent of the General Assembly from the language used, to give effect to that intent, and where reasonably possible to reconcile and harmonize statutes dealing with the same subject. State v. Kraus, 530 S.W.2d 684, 685 (Mo. banc 1975); Playboy Club, Inc. v. Myers, 431 S.W.2d 228, 231 (Mo.1968); Marty v. State Tax Commission, 336 S.W.2d 696, 699 (Mo.1960).
*816 Reading § 552.020.9 and § 552.030.3 together and in harmony requires us to conclude that it was the intent of the legislature that the latter section is an exception to the general bar enunciated in the former section. The accused, for the purpose of attempting to establish his partial responsibility or his diminished capacity, may introduce evidence obtained in the .020 examination. To the extent that the accused would offer evidence to prove a lessened state of mind, he does of necessity offer evidence lessening the degree of his "guilt".
Appellant was charged with assault with intent to kill with malice aforethought, § 559.180, RSMo 1969. Appellant could use as evidence testimony of the physician concerning information obtained during the court ordered .020 examination, which testimony indicated a mental defect of mental retardation, to attempt to prove under the partial responsibility doctrine that he did not have the capacity to form malice aforethought, thus lowering the degree of his criminal responsibility to assault with intent to kill without malice aforethought, § 559.190, RSMo 1969. If appellant wanted to expunge himself of all criminal responsibility for his acts by reason of a mental disease or defect, he could only do so by pleading not guilty by reason of mental disease or defect excluding responsibility and by compliance with all the conditions of § 552.030. The partial responsibility doctrine may not be used by a defendant to avoid all criminal responsibility for his acts. See Richardson, Reardon, & Simeone, Missouri's Mental Responsibility Law, A Symposium, 19 J.Mo.Bar 645, 711-12 (1963); State v. Padilla, 66 N.M. 289, 292, 347 P.2d 312, 314 (1959) ("[The diminished or partial responsibility doctrine] means the allowing of proof of mental derangement short of insanity as evidence of lack of deliberate or premeditated design.... [I]t contemplates full responsibility, not partial, but only for the crime actually committed.") Since application of the partial responsibility doctrine presupposes guilt of some crime, appellant necessarily introduced evidence upon the issue of his guilt.[6] Thus, it is difficult to see how appellant can claim to be entitled to a limiting instruction on evidence which he introduces to show a lesser degree of guilt.
In view of the bar mandated by § 552.020.9, subject only to the exception created by § 552.030.3, it appears highly improbable that we can or will be faced with the situation where the state is responsible for injecting prohibited evidence from an .020 examination. If such does occur, we can easily determine the extent to which it may have been prejudicial and order appropriate relief. In any event, we are not here required to meet that issue. We determine only that the oral and written limiting instructions mandated by § 552.030.6 are directed at statements and information obtained in the course of any court ordered.030 type examination after entry of a plea of not guilty by reason of mental *817 disease or defect excluding responsibility. The words "any such examination" as used in § 552.030.6 refer to the .030 examination or to an .020 examination that is treated by the trial court as an .030 examination.
Appellant did not plead not guilty by reason of mental disease or defect excluding responsibility for the acts charged nor did he give written notice of his intent to rely on such defense. He was not entitled to and did not receive the .030 examination nor could his .020 examination be treated by the court as an .030 examination. It was not error for the court to fail to give MAI-CR 2.36 in this case.
II
Appellant's second contention is that the court erred in not instructing the jury on the lesser included offenses of mayhem in certain circumstances, § 559.210, RSMo 1969, and common assault, § 559.220, RSMo 1969. Appellant was charged and convicted of assault with intent to kill with malice aforethought, § 559.180, RSMo 1969. The jury was also instructed on the lesser included offense of assault with intent to kill without malice aforethought, § 559.190, RSMo 1969. Appellant did not request an instruction on either mayhem in certain circumstances or common assault but did raise this point in his motion for new trial.
Mayhem in certain circumstances can be committed with culpable negligence. State v. Watson, 356 Mo. 590, 592-93, 202 S.W.2d 784, 786 (1947). All of the relevant assault crimes require intentional conduct. See State v. Hammond, 571 S.W.2d 114, 115-16 (Mo. banc 1978). Thus, mayhem in certain circumstances is not necessarily included within assault with intent to kill with malice aforethought. However, common assault may be a lesser included offense within assault with intent to kill with malice aforethought. State v. Nelson, 470 S.W.2d 464, 466 (Mo.1971). Rule 26.02(6), (now Rule 28.02(a)), provided that, whether or not requested, the trial court "must instruct the jury in writing upon all questions of law necessary for their guidance in returning their verdict." See also § 546.070(4), RSMo 1969. Instructions on lesser included offenses may be necessary for the guidance of the jury, provided that there is evidence to support a finding of the lesser included offense. State v. Watson, 364 S.W.2d 519, 522 (Mo.1963); State v. Washington, 357 S.W.2d 92, 95 (Mo.1962); State v. Burns, 328 S.W.2d 711, 713 (Mo.1959); State v. Leindecker, 594 S.W.2d 362, 364 (Mo.App.1980); State v. Webb, 518 S.W.2d 317, 321 (Mo.App.1975).
Both assault with intent to kill with malice aforethought and assault with intent to kill without malice aforethought require a specific intent to kill. The lesser included offense of common assault requires only a general intent to injure. State v. Hammond, 571 S.W.2d 114, 115-16 (Mo. banc 1978). A jury instruction on common assault should be given only when there is evidence of an assault with the general intent to injure. The state's evidence proved a specific intent to kill by showing that appellant held the cutting edge of a knife to Mrs. Noelker's throat, and that appellant explained the assault afterward by stating he had the feeling he had to kill someone. The defense attempted to rebut the state's evidence of an intent to kill by attempting to show that appellant acted impulsively and could not form the intent to kill. Viewing the entire record before us, we find no evidence to support a finding of a general intent to injure upon the part of appellant. It was not error to omit the instruction on common assault, § 559.220, RSMo 1969. See State v. Jackson, 477 S.W.2d 47, 53 (Mo.1972); State v. Liendecker, 594 S.W.2d 362, 365 (Mo.App.1980).
III
Appellant's third contention is that the trial court erred in not declaring a mistrial after certain improper remarks were made by the prosecutor during closing argument. The first remark that appellant protests is the comment by the prosecutor that, "this is a terrible thing that's happened. Under circumstances this might well be a case of murder." Malice or a *818 specific intent to kill is not an element of mayhem in certain circumstances. State v. Webb, 266 Mo. 672, 680, 182 S.W. 975, 976 (banc 1916). For the reasons previously stated, there was no evidence to support a submission of mayhem in certain circumstances nor was it error to omit the instruction on that offense. Appellant contends that this comment was improper in that it invited the jury to speculate on matters not within the record and to convict appellant for what he might have done, not for what he did. At trial, appellant immediately objected to this remark. The trial court sustained the objection and instructed the jury to disregard the remark by the prosecutor. After the verdict was rendered, appellant moved for a new trial arguing in part that a new trial be granted because of this prosecutorial remark. This motion was overruled.
The seriousness of error in any given argument depends on all the circumstances of the particular case. Whether the error was so serious as to result in prejudice not remediable by anything short of a mistrial rests basically in the sound discretion of the trial court, who was physically present and who could better evaluate ... [the prejudicial impact of the error on the jury.] Precedents in this area, as to what constitutes the degree of seriousness requiring a mistrial, are of only minor value because of actual differences in each case.
State v. Jasper, 521 S.W.2d 182, 185 (Mo. App.1975). See also State v. Vineyard, 574 S.W.2d 946, 947 (Mo.App.1978). An appellate court should disturb the trial court's disposition of this kind of error only when it abuses its discretion. State v. Phelps, 478 S.W.2d 304, 307-08 (Mo.1972); State v. Smith, 431 S.W.2d 74, 82-83 (Mo.1968); State v. James, 347 S.W.2d 211, 214 (Mo. 1961); State v. King, 334 S.W.2d 34, 40 (Mo.1960); State v. Decker, 591 S.W.2d 7, 11 (Mo.App.1979); State v. Guernsey, 577 S.W.2d 432, 435 (Mo.App.1979); State v. Brunson, 559 S.W.2d 60, 62 (Mo.App.1977). We find no such abuse of discretion.
The second remark that appellant protests is the following comment by the prosecutor:
This thing which I carry with me is a letter opener. Depending on how it's used. Cut strings, ribbons on Christmas packages for my wife, and occasionally a screwdriver. But if I cut a girl's throat from ear to ear with it, it's an instrument of murder.
Appellant contends that the comment is improper in that this remark is an unwarranted departure from the evidence by which the prosecutor inflamed the passion of the jury against appellant. Appellant did not object to this statement when it was made at trial. Our review is limited to "[p]lain errors affecting substantial rights...." Rule 27.20(c) (now Rule 29.12(b)). State v. McClure, 504 S.W.2d 664, 670 (Mo.App.1974). Rarely will an improper closing remark affect the substantial rights of a defendant. State v. May, 479 S.W.2d 451, 456 (Mo.1972); State v. Umfleet, 587 S.W.2d 612, 616 (Mo.App.1979); State v. Rauch, 583 S.W.2d 298, 300 (Mo.App.1979); State v. Bryant, 548 S.W.2d 209, 211 (Mo.App.1977); State v. Wendell, 547 S.W.2d 807, 820 (Mo.App.1976); State v. Sanders, 541 S.W.2d 782, 784 (Mo.App. 1976); State v. Brown, 528 S.W.2d 503, 505 (Mo.App.1975). This point is without merit.
IV
Appellant's fourth contention deals with a line of questioning that was not allowed on redirect. On cross examination by the prosecutor, Dr. Crane testified that he believed appellant had manufactured his hallucinations of "seeing blood," because appellant told Dr. Crane that he manufactured the story of having hallucinations in order to be sent to the state mental hospital rather than the penitentiary. On redirect the appellant's attorney attempted to introduce testimony from Dr. Crane that the reason appellant preferred the mental hospital to the penitentiary was that appellant had been subjected to several homosexual assaults in the county jail, and he feared that more such assaults would occur if he were sent to the penitentiary. This line of *819 questioning was objected to by the prosecutor, and the objection was sustained by the trial court. Appellant argues that the testimony concerning the homosexual assaults was necessary to rebut an unfavorable inference brought out on cross examination, citing State v. Durham, 418 S.W.2d 23, 28 (Mo.1967) and State v. Campbell, 533 S.W.2d 671 (Mo.App.1976). In each of these cases the evidence on redirect did tend to rebut unfavorable evidence brought out on cross examination. In the present case, the unfavorable evidence brought out on cross examination of Dr. Crane was the testimony that appellant had made up the story (lied) about having hallucinations in the hope of going to a mental institution rather than to prison. The unfavorable inference was that appellant had made an untrue statement. The proffered testimony did not rebut the inference that he had made the untrue statement, but rather was self serving in that it sought to show a more acceptable motive for the untrue statement. This point is without merit.
V
Appellant's final point is directed to admission into evidence of information obtained during a police interrogation. Appellant was read his Miranda warnings shortly after he was arrested. Appellant said that he understood these warnings. After the Miranda warnings had been read to appellant, Officer Brune visited the scene of the attack and found a white Bic butane cigarette lighter. Officer Brune took the lighter to the police station and asked appellant if the lighter was his. Appellant replied that it was. Appellant now contends that this testimony should be inadmissible because a second reading of the Miranda warnings was required in view of appellant's limited intelligence. In State v. Cluck, 451 S.W.2d 103, 104-05 (Mo.1970), we found that a second reading of the Miranda warnings may be necessary, depending on the totality of the circumstances. We do not believe the circumstances in the instant case require a second reading of the Miranda warnings. The evidence concerning the cigarette lighter merely tended to show that appellant had been at the park where the attack occurred. Appellant never disputed that he had been at the park.
The judgment is affirmed.
DONNELLY, RENDLEN, MORGAN and HIGGINS, JJ., concur.
BARDGETT, C. J., dissents in separate dissenting opinion filed.
SEILER, J., dissents and concurs in separate dissenting opinion of BARDGETT, C. J.
BARDGETT, Chief Justice, dissenting.
I respectfully dissent.
Section 552.020.9 provides no statement made by the accused in the course of any examination or treatment pursuant to this section and no information received by any physician or other person in the course thereof, whether such examination or treatment was made with or without the consent of the accused or upon his motion or upon that of others, shall be admitted in evidence against the accused on the issue of guilt in any criminal proceeding then or thereafter pending in any court, state or federal. The examination required under § 552.020 is the examination with reference to whether or not the accused lacks the mental capacity to stand trial. However, even though that may be the original purpose of the motion for an examination or the judge's order ordering examination, nevertheless subsection (3) requires that the report of that psychiatric examination include, inter alia, an opinion as to whether the accused has a mental disease or defect, and the duration thereof; an opinion as to whether the accused as a result of the mental disease or defect lacks capacity to understand the proceedings against him or to assist in his own defense; and (4) requires an opinion as to whether at the time of the alleged criminal conduct the accused as a result of mental disease or defect did not know or appreciate the nature, quality or wrongfulness of his conduct or as a result of mental disease or defect was incapable of conforming his conduct to the requirements of law. It is seen, *820 therefore, that the statement in the principal opinion that an examination with reference to whether the defendant is not guilty by reason of mental disease or defect an .030 examinationis ordered only if the defense of not guilty by reason of mental disease or defect is asserted is really not significant because both examinations are the same. The mental examination conducted for whatever reason, including an .020 primary reason, requires that the report give an opinion with respect to the inquiry that might be made under .030 whether he has a mental defect or disease excluding responsibility. The purpose of that is to let one examination suffice. Both are mental examinations, and the purpose of the .020 examination includes the purpose for the .030 examination. That becomes apparent from § 552.030.4 where it is stated:
"If an examination provided in 552.020 was made and the report thereof included an opinion whether at the time of the alleged criminal conduct the accused, as a result of mental disease or defect, did not know or appreciate the nature, quality or wrongfulness of his conduct or as a result of mental disease or defect was incapable of conforming his conduct to the requirements of law, such report may be received in evidence, and no new examination shall be required by the court unless, in the discretion of the court, another examination is necessary...."
In the instant case the examination was requested under § 552.020.2 but it included as part of the doctor's opinion more than an opinion with respect to whether or not defendant was mentally capable of standing trial. Even if the examination had been requested under .030, the report would have to have conformed to the requirements of 552.020, subsection 3, part of which has been set forth above.
Section 552.030.6 provides:
"No statement made by the accused in the course of any such examination and no information received by any physician or other person in the course thereof, whether such examination was made with or without the consent of the accused or upon his motion or upon that of others, shall be admitted in evidence against the accused on the issue of whether he committed the act charged, against him in any criminal proceeding then or thereafter pending in any court, state or federal. The statement or information shall be admissible in evidence for or against him only on the issue of his mental condition, whether or not it would otherwise be deemed to be a privileged communication. If the statement or information is admitted for or against the accused on the issue of his mental condition, the court shall both orally or at the time of its admission and later by instruction inform the jury that it must not consider such statement or information as any evidence of whether the accused committed the act charged against him." (Emphasis supplied.)
The prohibition of the subsection quoted immediately above and the requirement with respect to the court's instruction to the jury, both at the time the evidence is admitted, whether "for or against the accused", as well as at the close of the trial with respect to the instruction, is mandatory and applies to testimony by the physician who made the examination that was requested under either .020 or .030. There is simply no distinction made and none would be tenable.
MAI-CR 2.36 is required to be given whether requested or not. The instruction is required by the court because it is mandated by § 552.030.6, supra.
Although the sequence set forth in the principal opinion on pages four and five with reference to when a mental examination is done with respect to a plea of not guilty by reason of mental disease or defect after the plea and only if the state refuses to accept the pleamay appear on the face of the statute, nevertheless that is not the way it operates. If a defendant pleads not guilty by reason of mental defect, one can be certain that the prosecutor is not going to accept that plea unless he is persuaded that the defendant actually has a *821 mental defect that serious. In practical operation the examination is ordered upon the filing of the plea and thereafter the prosecutor will determine whether or not he is willing to accept the plea of not guilty by reason of mental disease or defect. The requirement for the limiting instruction, although found in § 552.030.6, is not restricted to the examination motivated by a plea of not guilty by reason of mental disease or defect. The prohibitions and requirements of § 552.030.6 come into play whenever testimony is given arising out of a mental examination ordered or obtained under Chapter 552 regardless of whether it is § 552.020 or § 552.030.
Section 52.030.3, mentioned in the principal opinion, addresses partial responsibility or diminished capacity and, provides in part:
"3. Evidence that the defendant did or did not suffer from a mental disease or defect shall be admissible
"(1) To prove that the defendant did or did not have a state of mind which is an element of the offense; or ...."
It is to be immediately noted that the examination provided under § 552.020 requires, as one of the findings in the report, an opinion by the doctor as to whether the accused "has a mental disease or defect, * * *" that is put in the present tense and is not restricted to a mental disease or defect excluding responsibility nor is it restricted to a mental disease or defect rendering the defendant incapable of understanding the proceedings against him. It is simply whether or not the accused has a "mental disease or defect." It seems clear to me again that one simply cannot decide whether the prohibitions under and requirements of § 552.030.6 are applicable by trying to decide what the primary purpose of the examination was in the first place. In any event, however, the diminished mental responsibility as provided for by § 552.030.3, supra, and the evidence provided for by subsection 6 of that same section, when it refers to any such examination, at least refers to an examination permitted by § 552.020 or § 552.030.
In this case, since the defendant had an examination under § 552.020 he was not entitled as a matter of right to another examination under § 552.030 even if he had requested it. See § 552.030.4.
The prohibition found in § 552.030.6, and the limiting instruction (MAI-CR 2.36) do not require that the jury be told that the testimony of the physician may not be considered by them on the issue of "guilt." It does require that the jury be advised that no statement made by the accused and no information received by physician in the course of the examination shall be admitted in evidence against the accused on the issue of whether he committed the act charged against him in any criminal proceeding. That is the substance also of MAI-CR 2.36.
In my opinion it is also incorrect to suggest that when a defendant seeks to avail himself of psychiatric evidence that he did not have a state of mind which is the element of the offense that there is any admission on the part of the defendant that he is guilty of something. It is quite common for the defendant to plead not guilty and not guilty by reason of mental disease or defect. While they may sound inconsistent, they nevertheless simply function so as to leave the burden of proof on the state to prove the defendant guilty beyond a reasonable doubt in other respects.
The reason the defendant is entitled to the limiting instruction in this case is because the statute requires the judge to give it both at the time the evidence is introduced and at the conclusion of the trial, and the court requires that MAI-CR 2.36 be given, pursuant to the statute, whether requested or not.
This is simply a case where the judge was not aware of the statute or the requirement of the instruction and neither was the prosecutor or the defense attorney. While it may be argued that the defense attorney might have known it and did not bring it up for the purpose of injecting error into the case, that is not indicated in the record here. In my opinion the principal opinion in this case will simply provoke confusion in the trial cases and probably bring about a *822 number of reversals of convictions whenever the trial judge undertakes to decide whether or not he must give the limiting instruction spoken of in this opinion. The long and the short of it is that the statute requires that it be given and the requirement that it be given does not depend upon the purpose for which the mental examination was made, nor is it dispensed with just because the defendant pleads a diminished mental capacity as permitted by § 552.030.3(1).
There is nothing in Chapter 552 to indicate that the limiting instruction required by § 552.030.6 is not applicable when the defendant seeks to introduce the evidence on a diminished mental capacity basis, as here, which is authorized by § 552.030.3(1). To the contrary, the unequivocal and all inclusive language of § 552.030.6 mandating the limiting instruction as to testimony of the doctor based upon this type examination admits of no exceptions. The instruction is not conditioned upon the nature of the defense but rather upon the source of the information. If the source was an .020 or .030 examination and the testimony is given at trial on mental condition, then that evidence is limited in its admissibility to the issue of mental condition and cannot be used as evidence of whether or not he did the act charged against him.
This defendant did not admit to any "guilt." He plead not guilty. Offering evidence of diminished mental capacity does not imply an admission of guilt of a lesser offense. It is simply evidence of a lack of a state of mind which is an element of the offense and does not presuppose guilt of any kind.
We must recognize that the state has the right to introduce evidence of mental capacity to show no diminished mental capacity and that evidence may be offered by the state and consist of the doctor's testimony who performed one of the .020 or .030 examinations. The principal opinion would, I take it, allow that evidence also without the limiting instruction if the evidence only went to diminished mental capacity.
The statutory requirement of the limiting instruction is clear and forthright. In my opinion we ought not to engraft exceptions to that mandate.
Simple adherence to the statutory requirements provided for in Chapter 552 will avoid reversals.
In my opinion it was error to fail to give the oral instruction as required by § 552.030.6 and the written instruction required by MAI-CR 2.36. I therefore dissent.
NOTES
[1] The physical attack that is the basis for the assault charge in this case occurred on February 11, 1977. The court ordered examination of appellant involved in this appeal was ordered by the trial court on June 7, 1977, and the examination occurred on June 10, 1977. All relevant statutory references are to statutes in effect on these dates unless otherwise indicated.
[2] At common law in Missouri a criminal defendant could not introduce evidence of a mental disease or defect to show that he did not possess the culpable mental state required as an element of the crime charged. See State v. Holloway, 156 Mo. 222, 231, 56 S.W. 734, 737 (1900). In 1963 the legislature enacted a Mental Responsibility Law, Laws of Mo. 1963, p. 674 (hereinafter referred to as S.B. 143). Section 552.030.3, RSMo 1969, which was derived from S.B. 143, § 3, provided in part, "Evidence that the defendant did or did not suffer from a mental disease or defect shall be admissible (1) To prove that the defendant did or did not have a state of mind which is an element of the offense; ..." In State v. Garrett, 391 S.W.2d 235, 243 (Mo.1965), this Court indicated that the enactment of § 3 of S.B. 143 did not adopt the diminished capacity doctrine. However, in State v. Anderson, 515 S.W.2d 534, 541 (Mo. banc 1974), we overruled Garrett on this point, in effect, adopting the partial responsibility or diminished capacity doctrine. In this case, no special instruction was given on the diminished capacity doctrine, as is now embodied in MAI-CR2d 3.74, effective January 1, 1979. Rather, appellant chose to converse the prosecution's verdict director on the element of intent. A converse instruction is sufficient to put the issue of diminished mental capacity before the jury. See State v. Cason, 596 S.W.2d 436, 438-39 (Mo.1980), cert. denied, ___ U.S. ___, 101 S. Ct. 397, 66 L. Ed. 2d 243 (1980).
[3] See Garrett v. State, 486 S.W.2d 272, 273-74 (Mo.1972).
[4] The present version of the § 552.020.9, RSMo Supp.1975, appears in § 552.020.11, RSMo Cum.Supp.1980.
[5] For the history of the "partial responsibility" or "diminished capacity" doctrine in Missouri, see note 2, supra.
[6] In stating that "application of the partial responsibility doctrine presupposes guilt of some crime," we do not mean that the defendant in any sense admits guilt by injecting the issue of partial responsibility into the case. The state still carries the burden of proving the defendant's guilt beyond a reasonable doubt on all issues submitted to the jury. The defendant merely has the burden of production or the burden of injecting the issue of diminished mental capacity into the case. See § 556.051, RSMo 1978 (effective 1/1/79); Notes on Use, MAI-CR 2.04 (discussing "special negative defenses"). In contrast, if the defendant chooses to plead not guilty by reason of mental disease or defect excluding responsibility, the defendant has both the burden of production and the burden of persuasion on the defense. See § 556.056, RSMo 1978 (effective 1/1/79); Notes on Use, MAI-CR 2.30.
What is meant by the statement that "application of the partial responsibility doctrine presupposes guilt of some crime" is that if the jury determines there is sufficient evidence to support a finding against the defendant on all the factual elements necessary to convict the defendant of a crime before the jury applies the partial responsibility doctrine, then upon applying the partial responsibility doctrine, the jury is only authorized to lessen the degree of the defendant's guilt to that of a lesser included offense. The jury is not authorized under the partial responsibility doctrine, to completely exonerate the defendant of all criminal responsibility for his acts. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564140/ | 616 S.W.2d 287 (1981)
The KROGER CO., Relator,
v.
The Honorable Lynn N. HUGHES, District Judge, and Margaret Walker, Respondents.
No. 17932.
Court of Civil Appeals of Texas, Houston (1st Dist.).
March 19, 1981.
*288 Bracewell & Patterson, Andrew F. Spalding, Houston, for appellant.
W. Allen Lee, III, Houston, for appellees.
Before EVANS, WARREN and DOYLE, JJ.
EVANS, Justice.
This is an original proceeding for writ of mandamus. The relator, defendant in a suit pending in the 165th Judicial District Court, seeks an order requiring the trial judge to enter judgment in its favor based upon a partial jury verdict.
Respondent, Margaret Walker, plaintiff in the principal action, sued the relator and a co-defendant, Clarence Latson, alleging that she had been falsely imprisoned by Latson and maliciously prosecuted by relator. She sought actual and exemplary damages from both defendants.
The case was tried to a jury, and after several days of deliberation the jury communicated to the court that it had unanimously answered four of the special issues and a part of a fifth special issue but that it was deadlocked as to the remaining issues. The trial judge instructed the jury to answer the special issues upon which it could agree and to have the foreman sign the charge. The jury returned its verdict accordingly, and the jury was polled and found to be unanimous in its verdict. The judge received and filed the partial verdict in open court and discharged the jury.
The relator subsequently filed a motion for entry of the judgment on the verdict, but the trial court refused to enter judgment and, instead, at plaintiff's request, declared a mistrial, reciting as the sole ground for its order that the jury's verdict was incomplete.
Where a jury returns a legally sufficient partial verdict and its answers to certain issues are of such a nature that a party is entitled to judgment no matter what the jury might have responded to the unanswered issues, it is the duty of the trial court to enter a judgment upon the verdict. Anheuser-Busch, Inc. v. Smith, 539 S.W.2d 234 (Tex.Civ.App.Houston [1st Dist.] 1976, no writ); Stalder v. Bowen, 373 S.W.2d 824 (Tex.Civ.App.Dallas 1963, writ ref'd n. r. e.).
In response to special issue number one the jury found that relator had instituted criminal proceedings against the plaintiff, but in response to special issue number three it found that relator had probable cause for doing so. In order for the plaintiff to recover against relator in her action for malicious prosecution, she was required to obtain a jury finding that the relator acted without probable cause. Dallas Joint Stock Land Bank of Dallas v. Britton, 134 Tex. 529, 135 S.W.2d 981 (1940). Thus, the jury's response to the third special issue rendered immaterial the jury's unanswered special issues pertaining to her claim for the alleged malicious prosecution.
With respect to the false imprisonment issues, the jury answered all sub-parts of special issues eight and nine, finding that the plaintiff was entitled to "0" damages as a result of the alleged detention by the defendant Latson. These findings rendered immaterial special issues five and six pertaining to the alleged illegal detention.
*289 Under the jury's answers to the special issues submitted, both defendants were entitled, as a matter of law, to a take-nothing judgment, and mandamus will issue to require the trial judge to enter the only judgment which could be rendered on the verdict. Shamrock Fuel & Oil Sales Co. v. Tunks, 416 S.W.2d 779, 781 (Tex.1967); Anheuser-Busch, Inc. v. Smith, supra.
This court is confident that the trial judge will proceed to enter judgment in accordance with this opinion, and only in the event the trial court should fail to so proceed, will the clerk of this court issue the necessary writ requiring such action. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564146/ | 616 S.W.2d 260 (1981)
Albert B. LUM, Appellant,
v.
Roger W. LACY, Appellee.
No. 17844.
Court of Civil Appeals of Texas, Houston (1st Dist.).
February 12, 1981.
Scott M. Jarrard, Houston, for appellant.
James T. Evans, Houston, for appellee.
Before COLEMAN, C. J., and PEDEN and SMITH, JJ.
*261 SMITH, Justice.
This is an appeal from an order sustaining a plea in bar.
Appellant, Albert B. Lum, filed suit in the district court against appellee, Roger W. Lacy. The suit was called for trial and appellant failed to appear. The trial court dismissed the suit, and the order in addition to dismissing the suit, stated: "Plaintiff takes nothing." Motion to reinstate the case was denied. Appellant perfected his appeal and during the course of the appeal appellant filed a second lawsuit against appellee in another district court. The appellant failed to pursue his appeal of the first lawsuit and it was dismissed for want of prosecution. The trial court in the second lawsuit sustained the appellee's plea in bar, that there has been a prior final adjudication against the appellant on the facts alleged in this cause of action.
The record does not contain a copy of the petition in the first suit; however, the parties have informed this court that the two suits filed by appellant were identical and that the trial court was also informed of this fact at the time of the hearing on the Plea in Bar. Such statement constitutes a judicial admission.
The appellant's one point of error is, "The trial court erred in dismissing this case with prejudice because there has never been an adjudication of the subject matter, only a prior dismissal for want of prosecution."
The parties agree that there was not an actual trial on the merits in the first suit; however, appellee asserts in his reply that the "take nothing" language in the judgment constitutes a ruling on the merits.
A judgment on the merits should not be made until the plaintiff has had his day in court. In rendering judgment dismissing a suit for want of prosecution, the judge must refrain from rendering a judgment against the merits of the suit. Zachary v. Overton, 157 S.W.2d 405 (Tex.Civ.App. Galveston 1941, ref'd w.o.m.).
Rule 165a, Texas Rules of Civil Procedure authorizes a judge to dismiss a suit for want of prosecution. A judge rendering a judgment other than that authorized by such rule has exceeded his jurisdiction. Freeman v. Freeman, 160 Tex. 148, 327 S.W.2d 428 (1959).
Appellee asserts the trial court, by rendering a take nothing judgment, did not commit fundamental error and appellant did not preserve this point. These contentions cannot be sustained as appellant has perfected this appeal alleging such error and it is fundamental error to render judgment on the merits on a non-appearing plaintiff. Burton-Lingo Co. v. Lay, 142 S.W.2d 448 (Tex.Civ.App.El Paso 1940, no writ); Freeman v. Freeman, supra.
The appellant's decision to abandon his appeal in the first suit and pursue his cause of action in his second suit does not effect the jurisdiction of the second court unless it conflicts with the judgment in the prior court. Cleveland v. Ward, 116 Tex. 1, 285 S.W. 1063 (1926). There is no conflict in the judgments rendered in the two suits being considered and the appellee's contention is without merit.
The appellee's further contentions that the statute of limitations had run and appellant's cause of action is barred by laches are not borne out by the record. The second suit was timely filed prior to the running of the statute of limitation, and although appellant's election of remedies has been burdensome to the judicial system, appellant has stayed within the rules of the system and is entitled to his day in court.
The judgment of the trial court sustaining the plea in bar is reversed and the cause is remanded.
Costs of appeal are charged to the appellee. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564138/ | 616 S.W.2d 753 (1981)
Hulon P. MITCHELL, Appellant,
v.
Ann MITCHELL, Appellee.
No. CA 81-3.
Court of Appeals of Arkansas.
June 3, 1981.
Winfred A. Trafford, Pine Bluff, for appellant.
Coleman, Gantt, Ramsay & Cox, Pine Bluff, for appellee.
CLONINGER, Judge.
Appellant Hulon P. Mitchell and appellee Ann Mitchell were divorced on October 17, 1978, and it was decreed that appellant was to pay the sum of $350.00 per month for the support of the couple's two minor children. Appellant was to also maintain insurance and pay medical bills on the children. When the oldest child, Michelle, attained age 18, appellant petitioned the court to terminate support for Michelle and to establish the proper amount of support for the one remaining child, Paula. The trial court found that support should continue for the older child and that appellant should pay $400.00 per month for the support of the two children.
For reversal, appellant urges that the trial court committed error when it (1) amended the pleadings to ask for continuing support beyond age 18 for the older child: (2) found that appellant had a duty to continue support for a child who had reached age 18; and (3) set the support at $400.00 per month.
We determine that appellant's first point is without merit, but that the trial court's decision must be reversed on points 2 and 3.
*754 In her response to appellant's petition, the appellee did not ask for continued support payments for Michelle, the older child, but requested only that the support payments for Paula, the younger child, be substantially increased. The issue of continued support for Michelle was brought up by the chancellor, and testimony was taken regarding the college expenses of Michelle. For his first point for reversal, appellant argues that it was an abuse of discretion for the court to amend the pleadings on its own motion.
This Court recently held in Capitol Old Line Insurance Company v. Gorondy, Administratrix, 1 Ark.App. 14, 612 S.W.2d 128 (1981), that the trial court may require a pleading to be amended to conform to the facts proved. Ark. Rules of Civil Procedure, Rule 15(b), provides that when issues not raised by the pleadings are tried by express or implied consent of the parties, they shall be treated in all respects as if they had been raised in the pleadings. There was no objection made by appellant to questions concerning college expenses of Michelle, and, in fact, appellant's attorney questioned appellant about Michelle's college expenses and voluntary payments toward college expenses made by appellant. The chancellor did not abuse his discretion in treating the pleadings as amended to conform to the evidence.
Appellant's second and third points are discussed together on this appeal because they were treated as interdependent by the trial court. The chancellor, in his ruling, discussed at length the duty of a parent to contribute to the college education of a child who has reached majority, and it is clear that the setting of support payments in this case was influenced by the chancellor's belief that a parent bears such a duty. The chancellor, in his ruling, made this observation:
The Court recognizing that there is no clear cut case in Arkansas directly in point but also recognizing that the very few cases that we have imply rather strongly that all parents of adult children, under certain facts, do have a certain legal obligation as distinguished from a moral obligation to support an adult child in college.
A number of Arkansas cases have held that a parent has a legal obligation to contribute to the education of an adult child, but in every case so holding there has been a circumstance of special need. In Petty v. Petty, 252 Ark. 1032, 482 S.W.2d 119 (1972), the Court held that support should be continued past majority where the daughter was afflicted with epilepsy and was in need of specialized training to obtain employment. In Elkins v. Elkins, 262 Ark. 63, 553 S.W.2d 34 (1977), the father was required to continue child support payments as long as his handicapped adult child was in college. In Matthews v. Matthews, 245 Ark. 1, 430 S.W.2d 864 (1968), the Court ordered support continued for an eighteen-year-old child until she graduated from high school. In Jerry v. Jerry, 235 Ark. 589, 361 S.W.2d 92 (1962), the Arkansas Supreme Court stated:
In Missouri Pacific Railroad Company et al v. Foreman, 196 Ark. 636, 119 S.W.2d 747 (at page 651 of the Ark. Reports) we said: `Ordinarily, there is no legal obligation on the part of a parent to contribute to the maintenance and support of his children after they become of age.' A significant word in the above quotation is the word `ordinarily,' showing that the Court realized there might be circumstances which could impose on a parent the duties to support a child after such child became of age. This fact was expressly recognized in Upchurch v. Upchurch, 196 Ark. 324, 117 S.W.2d 339 (page 327 of the Ark. Reports) where it was stated: `It is of course the duty of the father to contribute to the support of his children even after they are of age if the circumstances are such as to make it necessary.' ...
In Riegler v. Riegler, 259 Ark. 203, 532 S.W.2d 734 (1976) the Court stated:
The appellant's daughter involved in the case at bar has reached her majority and is not physically or mentally handicapped. We conclude, on trial de novo *755 that the appellant should have been relieved of the legal obligation to support his youngest daughter after she attained her majority and graduated from high school.
We are not aware any Arkansas case that has required a parent to support an adult child, whether in college or not, where there are not circumstances which make such support a necessity. There was no showing in the instant case that any special or unusual circumstance was present, and we hold that the appellant cannot be required to support Michelle. It was error for the trial court to consider the support of Michelle in establishing the amount of appellant's payments, and because of that error this cause must be reversed.
Appellant contends that the trial court committed error when, in fixing the amount of the support payments, it deviated from the mathematical formula set forth on the Family Support Chart. It is sufficient to say here that the chart is only a guide for the trial court and is not intended to be binding. The setting of the amount of support payments is in the sound discretion of the chancellor, and his finding will not be disturbed on appeal in the absence of a showing of an abuse of discretion. Grumbles v. Grumbles, 238 Ark. 355, 381 S.W.2d 750 (1964).
This cause is reversed and remanded to the trial court for the purpose of establishing the amount of support payments for the younger child, Paula. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564139/ | 16 So. 3d 868 (2009)
Diane ERICKSON, etc., Appellant,
v.
Robert L. IRVING, et al., Appellees.
Nos. 3D07-1963, 3D07-1790, 3D07-604.
District Court of Appeal of Florida, Third District.
June 17, 2009.
Rehearing and Rehearing En Banc Denied September 10, 2009.
*870 Ginsberg & Schwartz and Arnold R. Ginsberg, Miami; Gaebe, Mullen, Antonelli, Esco & DiMatteo and Michael A. Mullen, Coral Gables, for appellant.
Kubicki Draper and Sharon C. Degnan, Ft. Lauderdale, for appellees Robert L. Irving and David Long; Marlow, Connell, Abrams, Adler, Newman & Lewis and Rosemary Wilder, for appellees Community Asphalt and Abelardo Pupo.
Before ROTHENBERG, LAGOA, and SALTER, JJ.
LAGOA, Judge.
The plaintiff, Diane Erickson ("Erickson"), as personal representative of the Estate of Joseph A. Sindoni, Jr., appeals from multiple final judgments entered in this wrongful death case. Defendants, Community Asphalt and Abelardo Pupo ("Pupo"), cross-appeal. Because we conclude that the trial court erred in allowing the defense of joint enterprise to be submitted to the jury, we reverse and remand for a new trial.[1]
I. Factual and Procedural History
On February 2, 2000, three friends, Robert Irving ("Irving"), David Long ("Long"), and the decedent, Joseph Sindoni, Jr. ("Sindoni"), attended a scotch-tasting event at the Loews Hotel on Miami Beach. While Irving drove the three men to the event, he decided to leave the event with someone else. As a result, Irving gave his car keys to Long, who agreed to return the car to Irving's home in Coconut Grove. Long asked Sindoni if he would like to drive, but Sindoni refused. Long and Sindoni subsequently left the event with Long driving. Although Long originally intended to drop Sindoni off at Sindoni's home before returning the car to Irving's home, Sindoni suggested that the two stop at a bar in Coral Gables. After stopping at the bar for about forty-five minutes, Long and Sindoni left with Long again driving. On the way home, the car collided with a dump truck operated by Pupo in the course of his employment with Community Asphalt. Sindoni was killed in the accident, and Long subsequently plead guilty to DUI manslaughter.
In August 2001, Erickson filed suit against, among others, Long, Irving, Pupo, and Community Asphalt. In their answer, Long and Irving plead various affirmative defenses, including Sindoni's comparative negligence, and a joint enterprise defense based on their allegation that Sindoni and Long had joint control of the car. Prior to trial, Erickson twice moved to strike the *871 joint enterprise defense. The trial court, however, denied both motions.
The jury found Irving, Pupo, and Community Asphalt negligent. The trial court had previously determined Long's negligence as a matter of law because of his guilty plea in the criminal case. The jury also found that Long and Sindoni were involved in a joint enterprise at the time of the accident. In apportioning degrees of negligence, the jury assigned 35% to Long, 20% to Irving, 5% to Community Asphalt, 5% to Pupo, and 35% comparative negligence to Sindonithat is, the jury found the driver and the passenger equally at fault. The jury awarded Sindoni's mother and father $50,000 each for past pain and suffering but no damages for future pain and suffering.
Erickson filed a motion for a new trial arguing the inadequacy of the damage awards for future pain and suffering, as well as the legal insufficiency of Long and Irving's joint enterprise defense. The trial court denied the motion.
In light of the verdict on joint enterprise, Irving and Long filed a motion to enter final judgment. Long and Irving argued that because the jury found that Long and Sindoni were engaged in a joint enterprise, Long's percentage of fault had to be imputed to Sindoni, leaving Sindoni 70% at fault. Long and Irving, additionally, argued that because Sindoni should be apportioned 70% of the fault, none of the defendants were jointly and severally liable for the damages, pursuant to section 768.81(3)(c), Florida Statutes (1999). The trial court granted Long and Irving's motion, and ultimately entered a final judgment against Long in the amount of zero dollars, against Irving in the amount of $27,751.50, against Pupo in the amount of $6,937.87, and against Community Asphalt in the amount of $6,937.87.
This appeal and cross-appeal ensued.
II. Analysis
In order to establish the existence of a joint enterprise concerning the operation of a motor vehicle, the defendant must prove the following elements: 1) an agreement, express or implied, to enter into an undertaking, 2) a community of interest in the objects and purposes to be accomplished in the undertaking, and 3) equal authority to control the undertaking. Kane v. Portwood, 573 So. 2d 980, 985 (Fla. 2d DCA 1991). An agreement to go to a social gathering is usually not sufficient to create a "community of interest," nor is the fact that the passenger gives the driver directions. Id. Even situations such as carpools, in which the driver and passengers agree to drive to the same workplace and the passengers have the authority to demand that the driver correct his faults, are insufficient to create a joint enterprise. Conner v. Southland Corp., 240 So. 2d 822 (Fla. 4th DCA 1970). The fact that a passenger pays for the expenses of a trip also does not necessarily establish a joint enterprise. Yokom v. Rodriguez, 41 So. 2d 446 (Fla.1949). As the Supreme Court explained in Yokom, 41 So.2d at 448:
It is not sufficient that the passenger indicates the route or that both parties have certain plans in common, such as a `joy ride'; the community of interest must be such that the passenger is entitled to be heard in the control and management of the vehiclesuch as practically to amount to joint or common possession thereof.
The relationship between the driver and passenger must be "in effect that of partnership, principal and agent, or master and servant, or when the circumstances are such that the vehicle, though manually operated by one person, is in the actual control of another." Potter v. Fla. Motor *872 Lines, Inc., 57 F.2d 313, 315 (S.D.Fla. 1932).
The evidence in this case fails to establish that a joint enterprise existed between Long and Sindoni. As stated above, a mere "joy ride," or decision that persons will travel together to a social engagement or have plans in common is generally insufficient to establish a joint enterprise. Additionally, the fact that Sindoni purchased Long's drinks at the Coral Gables bar is also not evidence of a community of interest in the object and purpose of the evening. Moreover, the fact that one person pays the attendant expenses for a drive, the purpose of which is social, does not necessarily amount to a joint enterprise and certainly in this case is evidence of no more than a gift. As such, we conclude that the first two required elements for a joint enterprise defense agreement and a community of interest were not established.
Second, even if Long and Irving had been able to establish the first two elements of a joint enterprise, there was insufficient evidence to establish the third elementthat Long and Sindoni had equal authority to control the car. In order for there to be a joint enterprise, the control must be "such as practically to amount to joint or common possession thereof." Kane, 573 So.2d at 986. No evidence exists that Sindoni was anything more than a passive passenger in the vehicle. Indeed, when he had the opportunity to drive the car, Sindoni expressly refused.
This case is, therefore, distinguishable from Florida Power & Light Co. v. Polackwich, 677 So. 2d 880, 882 (Fla. 2d DCA 1996), in which a father and stepson were found to be engaged in a joint enterprise where together they agreed to undertake a "sailing adventure" on a catamaran, which they both had authority to control, because "[u]nlike an automobile, the catamaran was being operated by a team of men." Accordingly, the third element of equal authority to control the vehicle or undertaking was also not established. As such, we find that it was error for the trial court to allow the defense of joint enterprise to have been presented to and considered by the jury.
Finally, although it is not necessary to do so because of our conclusion that the facts in this case do not establish a joint enterprise defense, we note that it is unlikely the doctrine of joint enterprise would ever apply here. We can think of no basisat least none that would apply to this caseupon which to reach a conclusion that the joint enterprise doctrine may be applied to absolve a driver of all civil liability for the death of his passenger when he later pleads guilty to a DUI manslaughter for that death. The judgment in this case does not further any of the established purposes of the joint enterprise doctrine. See generally Kane, 573 So.2d at 982-986 (discussing historical uses of joint enterprise doctrine and doubting its continued validity in modern tort actions).
Long and Irving, however, argue that any error constituted harmless error that could be remedied simply by entering judgment in accordance with the percentages of fault assessed by the jury. We find Long and Irving's contention without merit. The trial court specifically instructed the jury that each member of a joint enterprise is responsible for the negligence of another member, and indeed, the jury assigned Long and Sindoni equal percentages of fault even though Sindoni did not drive the vehicle and specifically refused to drive the vehicle. Given this, we cannot say that the error did not affect the jury's verdict. See Katos v. Cushing, 601 So. 2d 612 (Fla. 3d DCA 1992). Accordingly, because we find that it was reversible error for the trial court to allow such a defense *873 to be submitted to the jury, we reverse and remand for a new trial.
Reversed and remanded.
NOTES
[1] Because we find that a new trial is warranted based on the trial court's error in allowing a joint enterprise defense to be presented to the jury, we do not address the remaining issues raised in the appeal or cross-appeal. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564142/ | 616 S.W.2d 617 (1981)
Charles C. SPEIER et al., Petitioners,
v.
WEBSTER COLLEGE, Respondent.
No. B-9923.
Supreme Court of Texas.
March 25, 1981.
On Rehearing May 6, 1981.
Rehearing Denied June 3, 1981.
Pat Maloney, San Antonio, for petitioners.
Groce, Locke & Hebdon, Ann C. Livingston, Thomas H. Crofts, and John O'Connell, San Antonio, for respondent.
McGEE, Justice.
This is a deceptive trade practice case. Eleven San Antonio policemen[1] brought suit against Webster College for treble damages for misrepresentations made about its master's degree program in criminal justice. Based on a jury verdict, the trial court rendered judgment against Webster College. The court of civil appeals reversed the judgment and remanded the cause to the trial court. 605 S.W.2d 712. We affirm that part of the judgment of the court of civil appeals denying the policemen recovery for mental anguish. We reverse that part of the judgment of the court of civil appeals holding the admission of a chart summarizing testimony into evidence was reversible error and, thus, we render judgment for the policemen.
In December 1977, Webster College operated a one-year master's degree program in criminal justice at Brooks Air Force Base in San Antonio. It offered the program to civilians as well as military personnel. The policemen enrolled in the first eight-week *618 semester of the program in anticipation of receiving a Master of Arts degree in Administration of Justice within the year. They attended classes at night while retaining their jobs with the San Antonio Police Department. Near the end of the first semester, Webster College notified the policemen that they would not be allowed to complete the program because the college could no longer offer courses to civilians. Several of the policemen immediately dropped out. The others finished the first semester but were not allowed to enroll for the next session.
The eleven policemen sued Webster College alleging damages for tuition, books, cost of travel to and from classes, time lost from employment, lost job opportunities, and mental anguish. The cause was submitted to the jury on special issues. The jury answered all liability issues against Webster College. They also found damages for each policeman for tuition, books, cost of travel to and from classes, and mental anguish. The jury did not find any damages for time lost from employment or lost job opportunities. The trial court trebled damages and rendered judgment on the verdict against Webster College for $174,940 of which $165,000 represented recovery for mental anguish.
The court of civil appeals reversed the judgment of the trial court and remanded the cause for a new trial. The court of civil appeals held that the policemen were not entitled to recover damages for mental anguish because no evidence existed to support such relief. The court also held that the trial court committed reversible error in admitting into evidence a chart summarizing the oral testimony of the policemen on damages. For the reasons stated in its opinion, we affirm that part of the judgment of the court of civil appeals denying the policemen recovery for mental anguish.
The primary question presented here is whether it was error and, if so, reversible error for the trial court to admit into evidence a chart reflecting the oral testimony of the policemen on damages. During the course of trial, the attorney for the policemen prepared a chart which was placed within the view of the jury. The chart listed the eleven policemen with six blank spaces beside each name whereby damages for tuition, books, cost of travel to and from classes, time lost from employment, lost job opportunities, and mental anguish could be filled in. When each policemen testified on damages, the attorney would fill in the figure reflecting the policeman's testimony into the appropriate blank space on the chart. After all the policemen had testified, all the blank spaces were filled in except those representing damages for lost job opportunities. At the end of trial, the trial court admitted the chart into evidence as "Plaintiffs' Exhibit 11." Webster College's objections that the chart was not evidence were overruled. The trial court also permitted the jury to take the chart with them into the jury room during deliberations.[2]
Disposition of this case is controlled by Champlin Oil & Refining Co. v. Chastain, 403 S.W.2d 376 (Tex.1965). In that case, we held that "charts and diagrams designed to summarize or perhaps emphasize" the testimony of witnesses are, within the discretion of the trial court, admissible into evidence. Id. at 389; see also Cooper Petroleum Co. v. LaGloria Oil & Gas Co., 436 S.W.2d 889 (Tex.1969). This assumes, of course, that the testimony summarized is admissible and already before the jury. See Cooper Petroleum Co. v. LaGloria Oil & Gas Co., supra, and Conford v. United States, 336 F.2d 285, 287 (10th Cir. 1964). We recognize that such summaries are useful and oftentimes essential, particularly in complicated lawsuits, *619 to expedite trials and to aid juries in recalling the testimony of witnesses. See Manges v. Willoughby, 505 S.W.2d 379, 383 (Tex.Civ.App.San Antonio 1974, n. r. e.).
Webster College contends that visual aids such as the one used by the policemen which merely list items and amounts of damages sought are not admissible into evidence. As authority for this contention, it cites Harvey v. State, 389 S.W.2d 692 (Tex. Civ.App.Dallas 1965, writ ref'd n. r. e.), where a chart summarizing testimony on damages was admitted into evidence. There, the court wrote:
"Nevertheless we have no difficulty in concluding that this chart was not admissible in evidence. It was not proof of any fact material to any issue being tried, being nothing more than the attorney's memorandum of what a witness had testified. We can think of no purpose it would serve except to aid the jury to remember the testimony of a certain witness, and we agree with appellants' counsel that the approval of such a practice would encourage the attorneys in every case to make similar charts of the testimony of all witnesses. This in our opinion would lead to much confusion, would unduly encumber records on appeal and would be contrary to the spirit, if not the letter, of Rule 281, Vernon's Texas Rules of Civil Procedure."
Id. at 694.
Although we agreed with the judgment of the court of civil appeals in Harvey, its language conflicts with our holding in Champlin Oil & Refining Co. v. Chastain, supra, and, to that extent, it is disapproved. The fact that a chart happens to summarize testimony on damages does not remove its admissibility from the discretion of the trial court. The type of testimony summarized is only one of many factors a trial court must consider in exercising its discretion. Consequently, to find error in this case, we must find that the trial court abused its discretion in admitting the chart into evidence.
Altogether the policemen sought to recover, and thus had the burden of proving sixty-six (66) items of damages. In the damage issue, the jury was asked to answer sixty-six (66) questions inquiring as to the amounts of damages, if any, sustained by the policemen on each of these items. For the items of damages that were found by the jury, the chart was helpful in aiding the jury in recalling testimony as to the exact amounts. In doing so, it enabled the jury to avoid mistakes in assessing damages. The fact that the chart may have emphasized the testimony of the policemen did not render the chart inadmissible. See Champlin Oil & Refining Co. v. Chastain, supra.
Webster College points out that one item of damages on the chart was filled in by the attorney without any testimony supporting it. We agree that the trial court committed error in admitting into evidence this portion of the chart, but such error was not properly preserved in the trial court for appellate review. Webster College's only objection to the chart was that it was not evidence. "A general objection to a unit of evidence as a whole, ... which does not point out specifically the portion objected to, is properly overruled if any part of it is admissible." Brown & Root, Inc. v. Haddad, 142 Tex. 624, 180 S.W.2d 339, 341 (1944). If a specific objection had been made, the trial court could have stricken the objectionable portion. Absent such an objection, Webster College cannot complain that the jury improperly considered it. Zamora v. Romero, 581 S.W.2d 742, 747 (Tex.Civ.App.Corpus Christi 1979, writ ref'd n. r. e.). We hold the trial court did not abuse its discretion in admitting the chart into evidence.
We affirm that part of the judgment of the court of civil appeals denying the policemen recovery for mental anguish. We reverse that part of the judgment of the court of civil appeals holding the admission of the chart into evidence was reversible error and, thus, we render judgment for the policemen.
ON MOTION FOR REHEARING.
McGEE, Justice.
Because Webster College was successful on appeal in reducing a $174,940 trial court *620 judgment by $165,000, it urges by its motion for rehearing that it should not be required to pay all costs, but rather should pay costs on an allocated basis. Our original judgment decrees that Webster College "shall pay all costs in this Court and in the Court of Civil Appeals."
We grant Webster College's motion for rehearing in part. We amend our former judgment as to costs and change the last paragraph of the opinion to read:
That part of the trial court's judgment awarding the policemen a recovery of $165,000 as damages for mental anguish is reversed and judgment is here rendered that the policemen recover nothing for mental anguish. The trial court's judgment is affirmed in all other respects. All costs are taxed one-half against the policemen and one-half against Webster College.
NOTES
[1] The policemen are: Charles C. Speier, Bruce W. Ritchey, Jr., Willie Smith, Jr., James A. Robinson, Jack Sumney, Don Brooks, Robert E. Rudewick, Thomas B. Foose, Alfred H. Domingues, Emil E. Fischer and Elton Simmons.
[2] The question of whether the trial court erred in permitting the jury to take the chart with them into the jury room during deliberations is not before this Court. There was no objection in the trial court and no point of error in the briefs challenging its presence in the jury room. However, we note that in City of Denton v. Hunt, 235 S.W.2d 212 (Tex.Civ.App.Fort Worth 1950, writ ref'd n. r. e.), it was held that a chart summarizing the oral testimony of a witness was not a deposition under Tex.R. Civ.P. 281 and, therefore, its presence in the jury room during deliberations was not error. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2303127/ | 344 F. Supp. 870 (1972)
INDUSTRIAL LIFE INSURANCE CO., Plaintiff,
v.
UNITED STATES of America, Defendant.
No. 70-614.
United States District Court, D. South Carolina, Columbia Division.
April 11, 1972.
*871 *872 Harry M. Lightsey, Jr., Columbia, S. C., for plaintiff.
Charles W. Gambrell, Asst. U. S. Atty., Columbia, S. C., for defendant.
ORDER.
CHAPMAN, District Judge.
This is an action brought by the plaintiff to recover income taxes and interest for the years 1963, 1964 and 1965, which it alleges were erroneously and excessively collected. The total amount of the claim is $41,037.35.
The case presents four basic questions, which are hereinafter answered in the Findings of Fact and Conclusions of Law. These questions are:
1. Whether the plaintiff, during 1963, 1964 and 1965, qualified for taxation as a life insurance company under Section 801, et seq., of the Internal Revenue Code of 1954.
2. Whether plaintiff allowed an unreasonable accumulation of earnings and is subject to the accumulated earnings tax imposed by Section 531 of the Internal Revenue Code of 1954.
3. Whether plaintiff was engaged in the sale of lots in the ordinary course of its trade or business during the years 1963 and 1964, so that any gain resulting therefrom was subject to taxation at ordinary income rates.
4. Whether IRS properly disallowed certain claimed automobile expenses on the grounds that they were not incurred in the conduct of plaintiff's business.
After hearing all testimony, reviewing all exhibits and the various briefs and reply briefs submitted, the Court makes the following
FINDINGS OF FACT
1. That plaintiff was chartered April 19, 1939, by the Secretary of State for South Carolina under the name of General Insurance Corporation, and through various name changes and amendments to the charter became Industrial Life Insurance Company on September 25, 1956.
2. That the original authorized capital stock of the corporation was $10,000 and that of this amount $2,500 was paid in.
3. That the charter of the corporation empowers it to issue contracts of insurance against all manner of hazards, including sickness, accident, death, casualty and liability, and all other forms of insurance contracts; to buy, sell, mortgage, and lease real estate and to do all things necessary and incident to the above powers.
4. That during 1942 control of the plaintiff corporation was acquired by Clayton Scyphers and his immediate family, who now own all the company stock, constitute its Board of Directors and serve as its officers.
5. That on or about May 20, 1969, the plaintiff paid to the defendant the sum of $41,037.35, being the amount assessed by the defendant as additional income tax and interest due by the plaintiff for the years 1963, 1964 and 1965 as follows:
1963 tax ____________________ $13,206.87
Interest ____________________ 4,103.20
----------
TOTAL _______________________ $17,310.07
1964 tax ____________________ $15,119.87
Interest ____________________ 3,768.59
----------
TOTAL _______________________ $18,888.46
1965 tax ____________________ $ 4,063.47
Interest ____________________ 775.35
----------
$ 4,838.82
6. That plaintiff filed timely claim for refund, after paying such taxes under protest and such claim for refund *873 was rejected by the defendant. This suit was brought pursuant to the provisions of 28 U.S.C.A. § 1346 for recovery of these amounts.
7. In the early years of the corporation it actively engaged in the business of writing weekly premium insurance. The weekly premium business was disposed of through reinsurance agreements and since 1956 the only insurance sold by the plaintiff has consisted of a credit life insurance policy on the lives of the debtors of Consumer Investment Company, Inc. issued March 1, 1962. This was a master group credit life insurance policy, and separate policies were not issued by the plaintiff to the individual debtors. Only debtors below the age of 65 years were covered. The maximum amount on one debtor was $2,000 and the length of the indebtedness could not exceed 36 months.
8. The evidence shows that there were from one thousand to twelve hundred debtors insured from time to time under this blanket policy and the average loan insured was approximately $250.
9. The premium income resulting from this credit life insurance blanket policy was $2,572.46 in 1963, $3,517.56 in 1964 and $3,423.92 in 1965.
10. During the years 1963, 1964 and 1965 Industrial Life Insurance Company paid premiums to itself on policies of life insurance on the lives of certain officers of the corporation, all of whom are members of the Scyphers family (Mr. Clayton Scyphers, his wife and his son), and the plaintiff was the beneficiary under said policies. The amounts paid in premiums for the respective years on these key man insurance policies were $3,561.25, $3,236.95 and $6,992.00. On these policies the plaintiff was not only the insurer and the beneficiary, but also paid the premiums.
11. During 1963 and 1964 the plaintiff had annual income from weekly premium, Industrial Life policies on members of the Scyphers family of $83.20 and $41.60. No such income was received during the year 1965.
12. The total premium income for the three taxable years was 1963$6,216.91, 1964$6,796.11 and 1965$10,415.92.
13. During the tax years in question, the plaintiff did not maintain a sales force, its office was located in the home of its president, Mr. Clayton Scyphers, and its primary income has been from the sale of real estate lots, rental of real estate and management of its investment portfolio. The activities of the corporation may best be shown from the following comparison of premium and investment income.
Comparison of Premium and Investment Income
1963 1964 1965
Premium Income ____________________________ $ 6,216.91 $ 6,796.11 $10,415.92
Other Income
Interest:
On Mortgages _________________________ 7,431.30 8,346.85 8,955.24
Miscellaneous ________________________ 56.09 -0- -0-
Consumer Investment __________________ 1,234.37 2,400.00 2,483.08
Bldg. & Loan _________________________ 833.75 1,685.05 2,897.82
Rents ________________________________ 4,965.12 5,982.45 6,055.12
Sale of lots _________________________ 20,000.00 22,000.00 -0-
Capital gaininstallment sale __ 204.77 221.25 -0-
---------- ---------- ----------
Total Investment Income ______________ $34,725.40 $40,635.60 $20,391.26
Comparison of Source of Premium Income
1963 1964 1965
Family premiums __________________________ $3,644.45 $3,278.55 $6,992.00
Other premiums ___________________________ 2,572.46 3,517.56 3,423.92
*874 14. In 1948 plaintiff bought 504 acres of land in Kershaw County, South Carolina as an investment. Part of this tract has been subdivided into residential lots and the above figures reflect $20,000 in 1963 and $22,000 in 1964 from the sale of such lots. In 1963 the plaintiff by three separate deeds conveyed to Clayton Scyphers eleven lots from this tract. In 1964 by one deed the plaintiff conveyed to Clayton Scyphers eleven lots out of this tract.
15. Prior to 1963 the real estate sales by plaintiff totaled thirteen in 1956, two in 1957, three in 1958, nine in 1959, four in 1960, eight in 1961 and three in 1962. Some of these sales covered more than one lot. Prior to 1963 there were no sales to Clayton Scyphers or members of his family. Prior to beginning the sale of residential lots out of the 504 acre tract, plaintiff obtained permission from the South Carolina Insurance Commission. On the lots sold to Clayton Scyphers, homes were constructed by him and sold.
16. The real estate, originally purchased as an investment, became property held for sale in the ordinary course of business due to the continued sale and development, and the large part of plaintiff's income resulting from such sales.
17. Since the time the Scyphers family obtained control of the plaintiff corporation, it has not paid a dividend. Earnings and profits have been accumulated, and the unassigned surplus account at the end of each of the years in suit was $232,765.41 for 1963, $260,018.06 for 1964 and $269,099.38 for 1965.
18. Plaintiff has shown no reasonable needs of the business to justify the continued accumulation of earnings and profits. It has been contended that these accumulations are necessary under requirements of South Carolina State Law (§ 37-181, 183 Code of Laws of South Carolina 1962) which provide minimum initial capital and surplus of $600,000.00. This figure is now required only of new insurance companies and does not apply to the plaintiff, which was chartered in 1939.
19. If the plaintiff is concerned about a possible change in the South Carolina law which would require its capital and surplus to be increased to $600,000, it is obvious that at the present rate of earnings accumulation, the plaintiff will not reach this figure for many, many years. If plaintiff really desired to build up its capital and surplus, it should increase its premium income by sale of insurance policies and its capital base by the sale of additional stock.
20. Plaintiff maintained and owned an automobile which was used by its president Mr. Clayton Scyphers for both business and personal uses. Due to the limited nature of plaintiff's business activities, it is found that not more than 25% of the automobile expenses were incurred in the conduct of plaintiff's business.
CONCLUSIONS OF LAW
1. Plaintiff was not a life insurance company within the meaning of the Internal Revenue Code of 1954 during the years 1963, 1964 and 1965.
The plaintiff mistakes the right to tax a life insurance company with the right to regulate such company. It contends that the McCarren Act 15 U.S.C.A. § 1011 clearly demonstrates the intent of Congress to leave regulation of insurance companies to the respective states. Since the plaintiff is chartered by the State of South Carolina as a life insurance company, files reports with and is regulated by the South Carolina Insurance Commission, plaintiff argues that the Federal Government may not contend otherwise. In the McCarren Act it is stated:
"Congress declares that the continued regulation and taxation by the several States of the business of insurance is in the public interest, and that silence on the part of the Congress shall not be construed to impose any barrier to *875 the regulation or taxation of such business by the several States."
Congress did not give up the right to tax insurance companies by passing the McCarren Act. Prior to 1921, insurance companies were taxed as ordinary corporations, but by the Revenue Act of 1921 Congress established a different method for taxing insurance companies, which methods, with some modification, have prevailed to this date. By establishing special taxing systems for insurance companies, because their premium and investment income differs from the income of manufacturing companies and other corporations, Congress had the right and power to decide what companies would be considered as insurance companies for tax purposes and enjoy the benefits of this legislation. Congress also had the power to decide which companies within the insurance industry would be treated by the Internal Revenue Service as life insurance companies, since their requirements differed from casualty insurance companies. 26 U.S. C.A. § 801 et seq., provides for the taxation of life insurance companies by the United States of America.
In Section 801(a) life insurance companies are defined:
"For purposes of this subtitle, the term `life insurance company' means an insurance company which is engaged in the business of issuing life insurance and annuity contracts (either separately or combined with health and accident insurance), or noncancellable contracts of health and accident insurance, if
(1) its life insurance reserves (as defined in subsection (b)), plus
(2) unearned premiums, and unpaid losses (whether or not ascertained), or noncancellable life, health, or accident policies not included in the life insurance reserves,
comprise more than 50 percent of its total reserves (as defined in subsection (c))."
Before a company may be classified under the above section as a life insurance company, it is necessary to determine if it is an insurance company, since this is the first requirement mentioned. The Internal Revenue Code does not define the term "insurance company", but Treasury Regulations on Income Tax (1954 Code), Section 1.801.3(a) provides:
"(1) The term `insurance company' means a company whose primary and predominant business activity during the taxable year is the issuing of insurance or annuity contracts or the reinsuring of risks underwritten by insurance companies. Thus, though its name, charter powers, and subjection to State insurance laws are significant in determining the business which a company is authorized and intends to carry on, it is the character of the business actually done in the taxable year which determines whether a company is taxable as an insurance company under the Internal Revenue Code."
"Section 1.801-3(2) (b) Life Insurance Company. (1) The terms `life insurance company' as used in subtitle A of the Code, is defined in Section 801(a). For the purpose of determining whether a company is a `life insurance company' within the meaning of that term as used in Section 801(a), it must first be determined whether the company is taxable as an insurance company (as defined in paragraph (a) of this section) . . . ."
Treasury Regulations have the force and effect of law and provide a standard to be followed in determining plaintiff's classification under the Internal Revenue Code. It is apparent that the nature and character of the business actually done in a particular tax year is controlling on whether a company is to be treated as an insurance company under the law. The test is applied on a year to year basis, so it is possible for a company to qualify as a life insurance company in one year, but not in the preceding or succeeding years.
The basic question presented is whether the issuance of insurance contracts by *876 the plaintiff constituted its primary and predominant business activity in 1963, 1964 and 1965. It is obvious from the financial information contained in Finding of Fact No. 13 that premium income for these years was small when compared with income from real estate, mortgages and investment.
It is also important to note that more than half of the premium income came from policies on the lives of the only officers and stockholders of the company. The only insurance contract written on persons outside the family was the group credit policy, which was issued prior to the years in suit. Although there was a sizable increase in premium income in the year 1965, all of this increase is attributable to members of the Scyphers family, which means that the plaintiff was buying additional insurance from itself insuring the lives of its officers and stockholders. Since this "key man" insurance was kept by the plaintiff and not reinsured with another company, the death of one of the members of the family, insured under a policy with plaintiff, would mean only a bookkeeping entry to the plaintiff, since the money would simply be transferred from one account to another, because the plaintiff is also the beneficiary.
One of the examples cited under Regulation 1.801-1(b)(2) is quite helpful in the present facts. It provides as follows:
"For example, during the year 1954 the M Corporation, incorporated under the insurance laws of the State of R, carried on the business of lending money in addition to guaranteeing the payment of principal and interest of mortgage loans. Of its total income for the year, one-third was derived from its insurance business of guaranteeing the payment of principal and interest of mortgage loans and two-thirds was derived from its noninsurance business of lending money. The M Corporation is not an insurance corporation for the year 1954 within the meaning of the Code and the regulations thereunder."
The plaintiff relies heavily upon the case of Alinco Life Insurance Company v. United States, 373 F.2d 336, 178 Ct. Cl. 813 (1967). A close examination of Alinco reveals that it is primarily a decision involving qualification as a life insurance company. The only business of Alinco was reinsuring certain risks under a reinsurance treaty with another insurance company. Even though Alinco did business with only one carrier, the risk during the tax year involved amounted to almost one billion dollars. Its sole business activity was in the reinsurance field and it did not have the majority of its income coming from real estate mortgages, dividends and interest. Alinco was also serving a legitimate business purpose of its owner, a large finance company, since the owner could not engage in the insurance business under the laws of the state under which it was incorporated.
The case of Cardinal Life Insurance Company v. United States of America (N.D.Tex.1969) 300 F. Supp. 387[1] is quite similar to the present facts, since Cardinal was duly licensed and chartered to do business in the State of Texas as a life insurance company, but did not maintain an active sales force soliciting and selling policies and its premium income represented a very small part of its total income. The remainder of its income came from interest, capital gains, rent and dividends. In Cardinal, the Court stated:
"It should be noted that the name of the company, the charter powers and subjection to State insurance laws are significant only in ascertaining the business which the company is authorized to conduct. Whether the Plaintiff is to be classed as a life insurance company for federal taxation purposes *877 is determined by the character of the business actually done during the taxable year. Bowers v. Lawyers Mortgage Co. 285 U.S. 182 [52 S. Ct. 350, 76 L. Ed. 690] (1932). Thus, to qualify as a life insurance company under the federal tax laws, a corporation must use its capital and efforts primarily in earning income from the issuance of contracts of insurance. See Louisville Title Company v. Lucas 27 F.2d 413 (W.D.Ky.). Moreover, the test is to be applied to the taxpayer on a year by year basis.
The question presented to the Court in this case then is whether the issuance of insurance contracts by Plaintiff constitutes its primary and predominant business activity during each of the taxable years involved. A review of the schedule of business activities set forth above clearly indicates that plaintiff was not `primarily and predominately' in the business of issuing life insurance contracts during any of the years involved in this action . . ."
In the Lawyers Mortgage Co. case, supra, the premium income of the taxpayer constituted about 35 percent of its total income, yet the Supreme Court held that it was not primarily in the insurance business within the meaning of the term "insurance company", as used by Congress. The premium income of Industrial Life is less than 20 percent of its total income, and when premiums on policies of the Scyphers family are omitted, premium income amounts to approximately 8 percent of the total for the years in question.
The Court concludes that for the years 1963, 1964 and 1965 the plaintiff was not a life insurance company under Section 801 et seq. of the Internal Revenue Code of 1954, since its primary and predominate business activity during these years was not issuing insurance or annuity contracts or reinsuring the risks underwritten by other insurance companies.
2. The plaintiff allowed its earnings to accumulate beyond the reasonable needs of the business and is therefore subject to the accumulated earnings tax imposed by Section 531 of the Internal Revenue Code of 1954. Sections 531, 532 and 533 provide, in part, as follows:
"Section 531. Imposition of accumulated earnings tax
In addition to the other taxes imposed by this chapter, there is hereby imposed for each taxable year on the accumulated taxable income (as defined in section 535) of every corporation described in section 532, an accumulated earnings tax equal to the sum of
(1) 27½ percent of the accumulated taxable income not in excess of $100,000, plus
(2) 38½ percent of the accumulated taxable income in excess of $100,000."
Section 532. Corporation subject to accumulated earnings tax
(a) General Rule. The accumulated earnings tax imposed by section 531 shall apply to every corporation (other than those described in subsection (b)) formed or availed of for the purpose of avoiding the income tax with respect to its shareholders or the shareholders of any other corporation, by permitting earnings and profits to accumulate instead of being divided or distributed . . ."
Section 533. Evidence of purpose to avoid income tax
(a) Unreasonable accumulation determinative of purpose.For the purposes of section 532, the fact that the earnings and profits of a corporation are permitted to accumulate beyond the reasonable needs of the business shall be determinative of the purpose to avoid the income tax with respect to shareholders, unless the corporation by the preponderance of the evidence shall prove to the contrary . . ."
*878 The taxpayer argues that since its stockholders are in a lower income tax bracket than the corporation, it is unlikely that the taxpayer has accumulated its earnings to avoid "the income tax with respect to its shareholders". This argument has no merit. The purpose of the accumulated earnings tax can be no better expressed than by the language of Section 532 above. It is recognized that a corporation's normal objective is not only to earn profits, but to pass these profits on to its shareholders in the form of dividends. Regardless of the shareholders tax bracket, as compared to the corporation, dividends are taxed twiceonce as the earnings of the corporation and again as a part of the taxable income of the shareholder.
This statutory restriction on the use of corporations to avoid income taxes of its shareholders is necessary when one considers the steeply graduated tax rates for individuals and compares them to the maximum tax rate for corporations. A corporation may be used to shield income when it is earned, and by accumulation of its earnings to avoid, either entirely or partially, the tax that would normally fall upon distribution to its shareholders.
Usually it is impossible to find the unanimity of interest among stockholders necessary to limit or abolish the payment of dividends except in family or closely held corporations. If dividends are not paid and the individual income tax thereon is not received, the tax law, through 531, collects these funds directly from the corporation when there has been an accumulation. As stated in Helvering v. National Grocery Co., 304 U.S. 282, 286, 58 S. Ct. 932, 934, 82 L. Ed. 1346 (1938):
"The statute in no way limits the powers of the corporation. It merely lays the tax upon corporations which use their powers to prevent imposition upon their stockholders of the federal surtaxes."
It is not necessary that "the purpose of avoiding the income tax with respect to its shareholders" be the sole, the primary or the dominant purpose for the accumulation. It is sufficient that such purpose be one of the motives which prompt the accumulation beyond the reasonable needs of the business. United States v. Donruss Co., 393 U.S. 297, 89 S. Ct. 501, 21 L. Ed. 2d 495 (1969).
Section 533(a) places the burden upon the corporation to prove by the preponderance of the evidence that such accumulations are not beyond the reasonable needs of the business. The plaintiff has failed to carry this burden. As pointed out in Finding of Fact No. 19, if plaintiff really wished to increase its capital and surplus there are other and more effective methods to accomplish this.
To justify such an accumulation, the need must be treated with economic reality. It is not sufficient for a taxpayer to merely recognize the problem and discuss it. "Definiteness of plan coupled with action taken toward its consummation are essentials." Dixie, Inc. v. Commissioner of Internal Revenue, 277 F.2d 526, 528 (2nd Cir. 1960).
3. The plaintiff was engaged in the sale of lots in the ordinary course of its trade or business during the years 1963 and 1964 and the gain resulting therefrom was subject to taxation at ordinary income tax rates.
Although the taxpayer originally purchased the land in Kershaw County as an investment, the corporation's purpose changed when it began to develop, subdivide and sell lots. This is particularly true in this case where the other activities of the corporation were so limited in scope and income. However, this property later became an asset held for sale in the ordinary course of business.
Since the capital gain statutes provide an exception to and reduction of the normal tax rates, they are to be narrowly construed. Corn Products Refining Co. v. Commissioner of Internal Revenue, 350 U.S. 46, 76 S. Ct. 20, 100 L. Ed. 29 (1955). The frequency and continuity of sales by the plaintiff *879 is demonstrated by the findings of fact in 14 and 15 above. It is obvious that these transactions were not "isolated" but show a pattern in the development and sale of lots. Although the property may have been bought as an investment, the real question is decided by the purpose for which it is being held at the time of the sale. Acquisition of property as an investment is not inconsistent with the later holding of the same property for sale to customers in the ordinary course of business. See Ackerman v. United States, 335 F.2d 521 (5th Cir. 1964) and Bauschard v. C. I. R., 279 F.2d 115 (6th Cir. 1960).
4. The automobile owned by the taxpayer and used by its president was not used more than 25 percent in the conduct of its business, and the expenses disallowed by Internal Revenue Service for such expenses are proper.
The testimony shows that the plaintiff provides its president with an automobile, which was used both for conducting the plaintiff's business as well as the president's personal and family pleasure. The office of the plaintiff was located in the home of its president and due to the very limited activities of the plaintiff, only a small amount of automotive travel was required. The plaintiff owned real estate in Kershaw County, a distance of only 20 to 25 miles from plaintiff's office, and trips to this property were not required on any regular or frequent basis.
Under Section 162(a) of the Internal Revenue Code, a deduction is allowed for all "ordinary and necessary expenses" paid or incurred in carrying on a trade or business. The operation of an automobile used in the business falls within this classification, but this does not include the use of said automobile for the personal affairs of an officer or employee of the corporation. The only reasonable inference to be drawn from the evidence in this case is that the Internal Revenue Service was generous in allowing the plaintiff to deduct 25 percent of the expenses in connection with the operation of said automobile.
It is, therefore, ordered that this case be and the same is hereby dismissed with costs.
NOTES
[1] On appeal from the United States this case was reversed in 425 F.2d 1328 (5th Cir. 1970). The reversal was on the ground of the district judge's misinterpretation of the Statute of Limitations and allowed government to go back three additional years and not on any ground having to do with the insurance question. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2470131/ | 337 F. Supp. 2d 1218 (2004)
In re FEDERAL GRAND JURY PROCEEDINGS 03-01.
No. 04-9071-MISC-CR.
United States District Court, D. Oregon.
September 20, 2004.
*1219 Charles F. Gorder, Jr., David L. Atkinson, Pamala R. Holsinger, Portland, OR, for Plaintiff.
Elden M. Rosenthal, Rosenthal & Greene, PC, Portland, OR, Gerry Spence, The Spence Law Firm, LLC, Jackson, WY, Michele Longo Eder, Michele Longo Eder, Attorney at Law, LLC, Newport, OR, for Material Witness.
ORDER
ROBERT E. JONES, District Judge.
This matter, which was dismissed by Order dated May 24, 2004, is before the court on three remaining motions[1]: (1) the Government's Motion to Amend Order Requiring *1220 Destruction of Seized Items (# 59), filed under seal; (2) Brandon Mayfield's Motion to Remove From Under Seal the United States's Motion to Amend Order Requiring Destruction of Seized Items, and to Remove From Under Seal Brandon Mayfield's Reply (# 63); and (3) the Government's Motion to Seal Reply Memorandum in Support of Motion to Amend Order Requiring Destruction of Seized Items (# 68). For the reasons stated and within the parameters specified below, the Government's motion to amend is granted; Mayfield's motion to unseal is granted in part and denied in part; and the Government's motion to seal is denied.
Because this opinion and order will not be filed under seal, I address the motions to seal and unseal first, before turning to the Government's motion to amend.
1. Motion to Unseal; Motion to Seal
The Government's motion to amend was filed under seal. Mayfield moves to unseal the Government's motion as well as his response to that motion. In turn, the Government moves to seal its reply in support of the motion to amend.
According to the Government, Fed.R.Crim.P. 6(e)(6), which applies to matters occurring before a grand jury, requires the motion to amend to be handled under seal. Alternatively, the Government asks that if the motion to amend is unsealed, then "the entire matter should be unsealed," including the substance of the information at issue in the motion. See Response to Witness' Motion to Unseal, p. 3 (emphasis in original). Mayfield, in turn, argues that the grand jury proceedings concerning him have ended and the nature of those proceedings have been made public; consequently, he contends, the Government's concern for grand jury secrecy is unfounded. Mayfield asks, however, that "the content of private and personal papers, documents or data seized from Mr. Mayfield or his family" not be disclosed. Memorandum In Support Of Brandon Mayfield's Motion To Remove From Under Seal, p. 3.
Fed.R.Crim.P. 6(e)(6) provides:
Records, orders, and subpoenas relating to grand-jury proceedings must be kept under seal to the extent and as long as necessary to prevent the unauthorized disclosure of a matter occurring before a grand jury.
The secrecy protection of Rule 6(e)(6) endures beyond the term of the grand jury. See AFL-CIO v. FEC, 333 F.3d 168, 175 (D.C.Cir.2003) ("[Rule] 6(e)(6) continues to protect suspects exonerated by a grand jury") (citing Illinois v. Abbott & Assocs., 460 U.S. 557, 566 n. 11, 103 S. Ct. 1356, 75 L. Ed. 2d 281 (1983)). The scope of secrecy includes information that may directly or indirectly reveal what transpired in a grand jury proceeding. See In re Grand Jury Investigation, 903 F.2d 180, 182 (3d Cir.1990) (Rule 6(e) secrecy protects the grand jury's deliberative process by keeping sealed the "essence of what took place in the grand jury room"); see also, In re Grand Jury Matter, 682 F.2d 61, 63 (3d Cir.1982) ("Rule 6(e) applies * * * to anything which may reveal what occurred before the grand jury") (citation omitted).
In this matter, although given the opportunity shortly after his arrest, Mayfield never appeared before a grand jury. Nor was he ever charged with any crime. Significantly, the essence of the material witness proceeding already is in the public record: Mayfield's identity, the charges against him that were being investigated, the affidavits in support of the search warrant applications describing the nature and manner of the FBI's surveillance, and the court's May 24, 2004, order instructing the Government to return Mayfield's property and destroy any copies. The Government's assertion of grand jury secrecy under Rule 6(e)(6) is moot on the open record *1221 in this matter. Specifically, any need to keep the records sealed to protect the disclosure of Mayfield's identity, see United States v. Procter & Gamble Co., 356 U.S. 677, 682 n. 6, 78 S. Ct. 983, 2 L. Ed. 2d 1077 (1958), is moot because Mayfield's identity as a material witness has been known publicly since the time of his arrest. Of course, secrecy does remain to protect the identities of other individuals or matters considered by the grand jury while investigating Mayfield.
In view of the unique situation presented by this material witness proceeding, I conclude that the Government's motion to amend should be unsealed. That conclusion requires me to address Mayfield's request, contained in his memorandum in support of his motion to unseal, that the court unseal the Government's motion yet keep certain content under seal:
[Mayfield] * * * submits that the government's Motion, and Mr. Mayfield's Response, should not be filed under seal, and should become part of the public record. If during this proceeding, the government seeks to mention or discuss the content of private and personal papers, documents or data seized from Mr. Mayfield or his family, said material (and discussion of it) should be filed under seal but nothing else about this proceeding should be kept from the public.
Memorandum in Support of Brandon Mayfield's Motion, p. 3 (emphasis added). Mayfield argues that the Government's legal position in the motion to amend and his response "are matters of utmost public importance [and] deserve disclosure and the resultant public debate," yet he wants the power to frame that debate by preventing full disclosure of all material information. He cannot have it both ways: His request for "selective disclosure" is denied.
In sum, Mayfield's motion to unseal (# 63) is granted in part and denied in part as set forth above. The Government's motion to seal its reply (#) is denied. The motion to amend and all related pleadings are hereby ordered unsealed. I now turn to the motion to amend.
2. Government's Motion to Amend Order
On May 24, 2004, this court, on motion of the Government, dismissed the material witness complaint against Mayfield and ordered that "all property seized in the execution of search warrants at Mayfield's residence, office and vehicles * * * be returned to Mayfield and any copies thereof in the government's possession be destroyed * * *." In re: Federal Grand Jury 03-01, Misc. No. 04-MC-9071 (Order, May 24, 2004)(# 33). A few days later, in a telephone conference with counsel, I was informed of Mayfield's intent to file a lawsuit against the United States. Based on that information, I suggested that the Government could retain copies of the materials and should submit them to the court for in camera review.
Following that discussion, the parties have been unable to negotiate an agreement concerning the Government's retention of copies of the materials at issue, the originals of which, except contraband, have been returned. In its present motion, the Government asks the court to formally amend the May 24, 2004, Order to allow it to retain, in a secure location, copies of materials seized so that it can defend itself and its employees in any future litigation with Mayfield or his family, as well as for use in any internal investigation or Congressional inquiry concerning the material witness proceeding. See Memorandum in Support of Motion to Amend, p. 6.
*1222 Mayfield opposes the motion to amend, arguing that the Government has no right or legitimate reason to retain copies of his property. I disagree. Nothing Mayfield cites, including Rule 41(g) of the Federal Rules of Criminal Procedure, either prohibits the Government from retaining copies of seized property or requires the Government to return both the originals and copies on a motion to return property. Moreover, even if Mayfield is correct that the Government should use the ordinary rules of civil procedure to obtain the materials in the probable event of civil litigation, the Government has a legitimate need to maintain copies to create a record for purposes of responding to any internal investigations or Congressional inquiries arising out of the material witness proceeding.
That portion of my previous order (# 33) that required destruction of all copies is hereby rescinded. Mayfield is entitled to the return of any of his property seized, except for the contraband or any classified or purportedly classified documents claimed to be unlawfully possessed, as set forth in the Government's response of September 13, 2004. The Government and government officials may retain copies of any documents or materials that are or may be relevant to any future civil litigation or official investigation. The Government shall keep the materials in a secure place, and must limit employee access to the materials except as necessary to respond to any civil claim brought by Mayfield or his family or any official concerning the material witness proceeding.[2] Further, in using any of the materials, the Government must protect from disclosure the identities of any persons other than Mayfield and any private or personal information about them.
One final matter must be addressed. Mayfield contends that he is entitled to conduct discovery in this criminal material witness proceeding to develop evidence concerning the dissemination of copies to various government agencies. I disagree and have, by minute order dated this date (#), granted the Government's motion to quash Mayfield's notice of deposition. If Mayfield wants to engage pre-lawsuit discovery, he must do so in the context of civil litigation under Federal Rule of Civil Procedure 27, see Schwarzer, Tashima & Wagstaffe, Rutter Group Practice Guide: Federal Civil Procedure Before Trial, ¶ 11:1325 ff., pp. XX-XXX-XX (The Rutter Group 2004) with the oversight of the judge who is assigned to the proposed civil case,[3] not in this material witness proceeding which has been dismissed and is closed for all further purposes.
CONCLUSION
Consistent with and as set forth in the above opinion, the Government's motion to amend (# 59) is granted and motion to amend (# 43) is moot. Mayfield's motion to unseal (# 63) is granted in part and denied in part, and the Government's motion to seal (# 68) is denied. This proceeding is ordered closed to all further pleadings and for all further purposes.
NOTES
[1] A fourth motion, the Government's first Motion to Amend Order Requiring Destruction of Seized Items (# 43), filed June 4, 2004, is moot.
[2] This requirement does not apply to contraband or classified or purportedly classified documents or materials, which may be handled in the ordinary course.
[3] I will not participate as judge in any future civil litigation involving this matter. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2399907/ | 977 F.Supp. 20 (1997)
UNITED STATES of America
v.
BCCI HOLDINGS (LUXEMBOURG), S.A., Bank of Credit and Commerce International, S.A., Bank of Credit and Commerce International (Overseas) Limited, and International Credit and Investment Company (Overseas) Limited, Defendants.
Crim. Action No. 91-0655(JHG).
United States District Court, District of Columbia.
August 26, 1997.
*21 U.S. Dept. of Justice, Asset Forfeiture Office, Stefan D. Cassella, Michelle L. Crawford, for the Government.
BCCI Holdings (Luxembourg), S.A., Bank of Credit and Commerce Intern., S.A., Bank of Credit and Commerce Intern. (Overseas) Ltd., and Intern. Credit and Investment Co. (Overseas) Ltd., pro se.
In re Third Round Incomplete Funds Transfer Petitioners
MEMORANDUM OPINION AND ORDER
JOYCE HENS GREEN, District Judge.
Presently pending is the United States' Motion to Dismiss ("Motion to Dismiss") the incomplete funds transfer petitions of Aneel Zaman ("Zaman") and Sanjay Bhandari ("Bhandari"), which claims filed pursuant to 18 U.S.C. § 1963(l) ("L-Claims"). The government has moved to dismiss both claims due to lack of standing and for failure to state a claim. For the reasons expressed below, the Motion to Dismiss will be granted as to both petitioners.
BACKGROUND
The facts surrounding BCCI's collapse are well known in the financial and legal communities, but certain facts bear repeating to set the stage for resolving the instant motions to dismiss these L-Claims.[1] In early 1991, the Bank of England received troubling information about BCCI's financial condition and integrity. In response, it commissioned a special audit, which "disclosed evidence of a complex and massive fraud at BCCI, including substantial loan and treasury account losses, misappropriation of funds, unrecorded deposits, the creation and manipulation of fictitious accounts to conceal bank losses, and concealment from regulatory authorities of BCCI's mismanagement and true financial position." Corrigan, Mattingly & Taylor, The Federal Reserve's Views on BCCI, 26 Int'l Law. 963, 970-71 (1992) (based on testimony before the Committee on Banking, Finance and Urban Affairs of the United States House of Representatives on September 3, 1991).
The results of the audit were shared with regulators in other countries, and, on July 5, 1991, banking regulators in the United Kingdom, Luxembourg and the United States, froze assets owned or controlled by BCCI. In New York, the Superintendent of Banks seized BCCI's assets at various New York banks, including those at First American Bank of New York ("FABNY"). By July 6th, eighteen countries had shut down BCCI's operations in their jurisdictions, and, as of July 29, 1991, forty-four countries had closed down BCCI branches.
On November 15, 1991, a three-count Indictment, which included charges of conspiracy, wire fraud and racketeering against BCCI, was filed in this Court. On January 24, 1992, this Court, following findings of fact and conclusions of law with supporting reasons made in open court, accepted the pleas of guilty of the four corporate defendants, collectively known as BCCI, and the Plea Agreement between them and the United *22 States of America. See Transcript of Guilty Plea Proceedings at 7 (Jan. 24, 1992). In accordance with 18 U.S.C. § 1963, this Court then entered an Order of Forfeiture.
Under paragraph 9 of the Plea Agreement and pursuant to the Order of Forfeiture, BCCI forfeited all of its property interests in the United States. Pursuant to paragraph 1(e) of the Forfeiture Order, the corporate defendants forfeited to the United States their ownership interests in all property located in the United States, including, without limitation, real property and all tangible and intangible personal property, however held, whether subsequently identified, determined or discovered in the course of the ongoing liquidation proceedings described therein or otherwise identified, determined, or discovered in any manner at any time (excluding property brought into the United States by or on behalf of Court-Appointed Fiduciaries of BCCI in the course of the management or disbursement of the liquidation estates).
Attached to the First Order of Forfeiture was a listing of BCCI accounts, with corresponding numbers, names, and approximate balances, which the United States Marshals Service was directed to seize forthwith. Because the government was unable to verify certain information concerning additional forfeitable accounts at the time the Order of Forfeiture was entered, the Court issued a First Supplemental Order on January 31, 1992, which directed immediate seizure of the specific assets listed therein. The Court later amended the Order of Forfeiture to include additional assets, including property set forth in Second and Third Supplemental Lists of Forfeited Property. See Order of Forfeiture of July 29, 1992 (Second Order of Forfeiture); Order of Forfeiture of August 19, 1993 (Third Order of Forfeiture). Attached to the Third Order of Forfeiture, which is relevant to the petitioners' Third Round L-Claims that are presently before the Court, was the Third Supplemental List of Forfeited Property aggregating $101,302,465.54.
The Plea Agreement also established the Worldwide Victims Fund and the U.S. Fund. Under the terms of the Plea Agreement, forfeited assets were to be disbursed in equal amounts to the Worldwide Victims Fund and the U.S. Fund. See Plea Agreement ¶ 11(c). The broad purpose of the Worldwide Victims Fund, operated by the Court-Appointed Fiduciaries, is to distribute funds "only to innocent depositors, creditors and other victims of BCCI whose claims are not derived directly or indirectly through violations of United States or other laws concerning narcotics, terrorism, money laundering, crimes of violence, or other acts generally recognized as felonies or similar crimes under the law of countries subscribing to recognized norms of international justice." Id. ¶ 14.
The purpose of the U.S. Fund is more specific, but no less compensatory. In addition to allowing for reimbursement of the costs of investigation and prosecution of BCCI, bank insurance and other matters, the U.S. Fund is also available to provide "restitution to victims of BCCI, which may include remission to the Court Appointed Fiduciaries in accordance with 18 U.S.C. § 1963(g) for the purpose of facilitating an increase in assets available for distribution by the Court-Appointed Fiduciaries to innocent worldwide victims of BCCI, and which may include claims related to the failure of Cen-Trust, if any." Id. ¶ 12(f). Resulting from BCCI's guilty plea and the subsequent criminal forfeiture proceedings, by July 1996 the United States had "recovered nearly $800 million, virtually all of which has been, or will be, distributed to the victims of the fraud." Testimony of Stefan Cassella before the Judiciary Committee of the House of Representatives (July 22, 1996), 1996 WL 410099, *5 (F.D.C.H.).[2]
In compliance with 18 U.S.C. § 1963(l)(1)and to inform third parties of their potential rights to seek recovery of *23 assets declared forfeited in the Third Order of Forfeiture, the United States published notice of the Order of Forfeiture, as amended, during the period September 3, 1993, and September 27, 1993 in eleven major newspapers including the Wall Street Journal, the New York Times, the Chicago Tribune, the Los Angeles Daily Journal, the Washington Post, and the International Herald Tribune. See United States' Notice to the Court of the government's compliance with Order of August 19, 1993 (filed Sept. 21, 1993). In addition, personal notice was sent to over 523 persons and entities. Id. at Exhibit 2, at 11. Thereafter, the petitioners timely filed L-Claims, which the government now seeks to dismiss.[3]
DISCUSSION
BCCI's assets were forfeited pursuant to 18 U.S.C. § 1963,[4] which sets forth an orderly procedure by which third parties seeking to recover interests in forfeited property may obtain judicial resolution of their claims. It permits any person, other than the defendant, claiming a legal interest in forfeited property to petition the Court for a hearing to adjudicate the validity of that interest. 18 U.S.C. § 1963(l)(2).[5] Section 1963(l)(6) sets forth the substantive elements that a third party must establish to obtain amendment of an order of forfeiture:
If, after the hearing, the court determines that the petitioner has established by a preponderance of the evidence that
(A) the petitioner has a legal right, title, or interest in the property, and such right, title, or interest renders the order of forfeiture invalid in whole or in part because the right, title, or interest was vested in the petitioner rather than the defendant or was superior to any right, title, or interest of the defendant at the time of the commission of the acts which gave rise to the forfeiture of the property under this section; or
(B) the petitioner is a bona fide purchaser for value of the right, title, or interest in the property and was at the time of purchase reasonably without cause to believe that the property was subject to forfeiture under this section;
the court shall amend the order of forfeiture in accordance with its determination.
18 U.S.C. § 1963(l)(6).
A petitioner must first establish standing. Only by establishing standing and alleging the requisite elements of either § 1963(l)(6)(A) or § 1963 (l)(6)(B) may a party obtain judicial relief from an order of forfeiture. See United States v. BCCI Holdings (Luxembourg), S.A., et al. (In re Petition of Pacific Bank), 956 F.Supp. 5, 10 (D.D.C.1997); United States v. BCCI Holdings (Luxembourg), S.A., et al. (In re Petition of BCCI(O) Foreign Branches), 833 F.Supp. 32, 36 (D.D.C.1993), aff'd, 46 F.3d 1185, 1188 (D.C.Cir.), cert. denied sub nom. Chawla v. United States, 515 U.S. 1160, 115 *24 S.Ct. 2613, 132 L.Ed.2d 856 (1995); United States v. BCCI Holdings (Luxembourg), S.A., et al. (In re Petition of Chawla), 833 F.Supp. 9, 13 (D.D.C.1993), aff'd, 46 F.3d 1185, 1188 (D.C.Cir.), cert. denied sub dom. Chawla v. United States, 515 U.S. 1160, 115 S.Ct. 2613, 132 L.Ed.2d 856 (1995); see also United States v. Schwimmer, 968 F.2d 1570, 1584 (2nd Cir.1992); United States v. Lavin, 942 F.2d 177, 187 (3rd Cir.1991). If a third party fails to allege in its petition all elements necessary for recovery, including those relating to standing, the court may dismiss the petition without providing a hearing. See In re Petition of Pacific Bank, 956 F.Supp. at 10; see also S.Rep. No. 225, 98th Cong., 1st Sess. 191, 208 n. 46 (Sept. 12, 1983); United States v. Campos, 859 F.2d 1233, 1240 (6th Cir.1988); United States v. Mageean, 649 F.Supp. 820, 825 (D.Nev.1986), aff'd without opinion, 822 F.2d 62 (9th Cir. 1987).
In resolving a motion to dismiss, the Court assumes true, as she must, the facts alleged in a petitioner's L-Claim. A motion to dismiss under Fed.R.Civ.P. 12(b)(6) may be granted if it appears that the petitioner can prove no facts that would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957); Kenneda v. United States, 880 F.2d 1439, 1442 (D.C.Cir.1989). The Court construes the petition liberally, granting a petitioner the benefit of any reasonable inferences that can be derived from the facts alleged. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974). The Court is not required, however, to accept inferences unsupported by the facts alleged or legal conclusions that are cast as factual allegations. Kowal v. MCI Communications, 16 F.3d 1271, 1275 (D.C.Cir.1994).
Section 1963(l)(2) requires a party to assert "a legal interest in property forfeited to the United States" to have standing. This requirement is imposed to further the purpose of an L-Claim proceeding, which, while ancillary to the underlying criminal case, is intended to ensure that property forfeited to the United States was that of the defendant; it does not attempt to divide the defendant's estate among competing claimants. See United States v. BCCI Holdings (Luxembourg), S.A. (In re Petitions of General Creditors), 814 F.Supp. 106, 110 (D.D.C.1993). This latter task is properly performed at a liquidation proceeding, where all parties without a "legal interest" in forfeited property can recover on a pro rata basis with the many other claimants to the debtor's estate. Id. at 111: see Downriver Community Fed. Credit Union v. Penn Square Bank, 879 F.2d 754 (10th Cir.1989), cert. denied, 493 U.S. 1070, 110 S.Ct. 1112, 107 L.Ed.2d 1019 (1990); First Empire Bank-New York v. F.D.I.C., 572 F.2d 1361 (9th Cir.1978), cert. denied, 439 U.S. 919, 99 S.Ct. 293, 58 L.Ed.2d 265 (1978).
The critical inquiry in an L-proceeding is, therefore, ownership of the disputed funds. As recognized by this Court and most, if not all, other courts addressing the issue, an unsecured creditor does not possess an interest in any specific asset of a debtor and merely has a general interest in the debtor's entire estate. See In re Petition of Chawla, 46 F.3d at 1191; In re Petition of Pacific Bank, 956 F.Supp. at 10; see also Schwimmer, 968 F.2d at 1581; Campos, 859 F.2d at 1240; United States v. Reckmeyer, 836 F.2d 200, 206 & n. 3 (4th Cir.1987); Mageean, 649 F.Supp. at 828. Because a general creditor is unable to assert an interest in a specific asset, it cannot assert a legal right, title, or interest "in property which has been ordered forfeited" as required by § 1963(l)(2), at least in situations where, like here, a defendant's entire estate is not subject to forfeiture. In re Petition of Chawla, 46 F.3d at 1191; see Reckmeyer, 836 F.2d at 206 n. 3 ("It is the dilemma of linking their interest to a specific asset rather than the problem of asserting a legal interest in the debtor's estate that frustrates general creditors who attempt to contest ... forfeitures."). Accordingly, absent a showing of an interest in a specific asset, the petitioners would lack standing to assert a claim in these L-proceedings.
L-Claim of Aneel Zaman.
Zaman seeks $35,000 from forfeited BCCI (Overseas) Lahore, Pakistan account number XXXXXXXX, which BCCI account was *25 held at FABNY. On July 5, 1991, acting as originator, see N.Y.U.C.C. § 4-A-103(1)(b), Zaman requested that originating bank Wells Fargo Bank, see id. § 4-A-104(3), transfer $35,000 from his account at Wells Fargo to the account of beneficiary Sigmatech at beneficiary bank BCCI (Overseas) Rawalpindi, Pakistan. See id § 4-A-104(4) (defining beneficiary); id. § 4-A-103(1)(C) (defining beneficiary bank). Relying upon its correspondent, intermediary bank FABNY, in New York, see id §§ 4-A-104(2); 4-A-103(1)(d), Wells Fargo issued a payment order for FABNY to debit its account and credit the same to BCCI's account at FABNY. Although FABNY credited BCCI's account, the transfer of funds to Sigmatech's account was not completed prior to the intervention.
As the entity giving an instruction to a receiving bank, id. § 4-A-103(1)(e), FABNY was "the bank with correspondent relations between both the originator's bank and beneficiary's bank, [which] implement[ed] a payment order received by it by instructing the beneficiary's bank to transfer funds to the beneficiary." Fry, Basic Concepts in Article 4A: Scope and Definitions, 45 Bus. Law. 1401, 1412 (1990). See generally id. at 1415-16 (describing funds transfer relationship among originator's bank, beneficiary's bank and a mutual correspondent similar to relationship between Wells Fargo, FABNY and BCCI here).
Acceptance within the meaning of the New York Uniform Commercial Code ("N.Y.U.C.C."), which provides the rule of decision, is key, because title to funds in a wire transfer is passed to a receiving bank upon acceptance of a payment order.[6]See, e.g., In re Petitions of General Creditors, 814 F.Supp. at 109; Shawmut Worcester County Bank v. First American Bank & Trust, 731 F.Supp. 57, 60 (D.Mass.1990). Under Article 4-A, and directly applicable to these facts, a beneficiary bank (like BCCI here) accepts a payment order when the bank receives payment of the entire amount of the sender's order pursuant to paragraph (a) or (b) of Article 4-A-403(1). N.Y.U.C.C. § 4-A-209(2)(b). Article 4-A-302(1)(b) provides that, if the sender is a bank (like FABNY here), payment occurs when the sender credits an account of the receiving bank with the sender. Id. § 4-A-403(1)(b); see Ballen & Diana, Duties of the Beneficiary's Bank, 45 Bus.Law. 1467, 1468 (1990) ("payment by the sender (assuming the sender is a bank) to the beneficiary's bank occurs ... if the sender credited an account of the beneficiary's bank with the sender"). Of the acceptance possibilities relevant here, a beneficiary bank accepts a payment order when a correspondent bank acting as a sender credits the beneficiary bank's account. N.Y.U.C.C. §§ 209(2)(b); 403(1)(b).
Examined in this light, Zaman's L-Claim must be dismissed. Once the funds were credited to BCCI's account, it accepted the payment order and title passed to BCCI. When BCCI failed to perform by paying the intended beneficiary, Zaman was left with a cause of action against BCCI. Such an unsecured claim simply leaves him, at most, in the position of a general creditor of BCCI.[7] And, it is the law of this Circuit that general creditors lack standing to assert claims under 18 U.S.C. § 1963(l). In re Petition of Chawla, 46 F.3d 1185, 1191 (D.C.Cir.), cert. denied *26 sub nom. Chawla v. United States, 515 U.S. 1160, 115 S.Ct. 2613, 132 L.Ed.2d 856 (1995). Moreover, the inability to assert a legal interest in a specific asset would undermine the petitioner's claim on the merits. See, e.g., In re Petition of General Creditors, 814 F.Supp. at 110-11. Like other general creditors, Zaman is free to petition the Attorney General for equitable remission of his claim or submit an application for relief to the Worldwide Victims Fund. However, his L-Claim in this proceeding will be dismissed.
L-Claim of Sanjay Bhandari.
Bhandari claims an interest in $10,000 in a BCC Hong Kong account at the Bank of New York ("BNY"), which account was not seized pursuant to the Third Order of Forfeiture. The Court accepts the following facts as true: On July 5, 1991, originator GEMCO in Hong Kong initiated a wire transfer from the originator's bank, BCC Hong Kong, to beneficiary Bhandari's account at Citibank, the beneficiary's bank. To execute this transaction, BCC Hong Kong issued a payment order to intermediary bank BNY, instructing it to debit BCC Hong Kong's account at BNY and credit Citibank's account for further transfer to beneficiary Bhandari. However, as it can do under Article 4-A of the New York Uniform Commercial Code, see N.Y.U.C.C. § 4-A-209 Official Comment 3; id. § 4-A-212, the intermediary (and receiving) bank BNY rejected the payment order. See Baxter & Bhala, Proper and Improper Execution of Payment Orders, 45 Bus. Law. 1447, 1452-53 (1990) ("Article 4A imposes no duty to execute on the pail of a receiving bank, and expressly provides that there is no `duty to accept a payment order or, before acceptance, to take any action, or refrain from taking any action, with respect to an order.'") (quoting U.C.C. § 4A-212). BNY neither debited BCC Hong Kong's account nor credited Citibank's account. Bhandari's account was therefore never credited.
Thus, Bhandari's L-Claim must be dismissed. Title to funds represented by a credit passes upon acceptance by the receiving bank. See supra. In this transaction, BCC Hong Kong retained title because BNY rejected the payment order. N.Y.U.C.C. § 4-A-209 Official Comment 3; id. § 4-A-210. At most, Bhandari is a general creditor of BCCI. As such, he lacks standing in this L-Claim proceeding. And, Bhandari's claim fails for an additional reason: the funds he seeks were not seized pursuant to the Third Order of Forfeiture and, therefore, the Court lacks jurisdiction over that property. United States v. BCCI Holdings (Luxembourg), S.A., (In re Petition of Khawaja Qadeer Ahmed), 923 F.Supp. 264, 265 (D.D.C.1996). For both of the aforementioned reasons, Bhandari's L-Claim is fatally flawed and will be dismissed.
CONCLUSION
For the reasons stated above, it is hereby
ORDERED that the government's Motion to Dismiss is granted and the L-Claims of Aneel Zaman and Sanjay Bhandari are dismissed. Judgment will be entered separately in accordance with Fed.R.Civ.P. 58
IT IS SO ORDERED.
In re Third Round Incomplete Funds Transfer Petitioners
JUDGMENT
In accordance with the Memorandum Opinion and Order issued this date and pursuant to Fed.R.Civ.P. 58, judgment is hereby entered in favor of the United States and against Petitioner Aneel Zaman.
IT IS SO ORDERED.
NOTES
[1] "BCCI," as used herein, refers collectively to BCCI Holdings (Luxembourg) S.A., its two operating subsidiaries, Bank of Credit and Commerce International, S.A., and Bank of Credit and Commerce International (Overseas) Limited, and International Credit and Investment Company (Overseas) Limited, an entity previously found to be the alter ego of the other BCCI entities.
[2] In 1995, over $225 million was disbursed to the Court Appointed Fiduciaries for the Worldwide Victims Fund. See Notice to the Court at I (filed Aug. 13, 1996). On August 1, 1996, the United States disbursed an additional $83,651,863.24, id. at 2, and, on May 22, 1997, Attorney General Janet Reno "determined that the United States would transfer 100 percent of its share of the forfeited funds to the Worldwide Victims Fund so that the funds might be distributed to all BCCI victims equally on a pro rata basis." Notice to the Court at 2 (filed July 11, 1997).
[3] Although the opportunity for oral argument was offered to each Third Round petitioner, neither of the instant petitioners so requested.
[4] 18 U.S.C. § 1963(a) provides, in relevant part:
Whoever violates any provision of section 1962 of this chapter shall ... forfeit to the United States, irrespective of any provision of State law
(i) any interest the person has acquired or maintained in violation of section 1962;
(2) any
(A) interest in;
(B) security of;
(C) claim against; or
(D) property or contractual right of any kind affording a source of influence over;
any enterprise which the person has established, operated, controlled, conducted, or participated in the conduct of, in violation of section 1962, and
(3) any property constituting, or derived from, any proceeds which the person has obtained directly or indirectly, from racketeering activity or unlawful debt collection in violation of section 1962.
The court, in imposing sentence on such person shall order ... that the person forfeit to the United States all property described in this subsection.
[5] This provision provides:
Any person other than the defendant, asserting a legal interest in property which has been ordered forfeited to the United States pursuant to this section may, within thirty days of the final publication of notice or his receipt of notice under paragraph (1) whichever is earlier, petition the court for a hearing to adjudicate the validity of his alleged interest in the property. The hearing shall be held before the court alone, without a jury.
[6] A payment order is defined in Art. 4-A-103(1)(a) as
an instruction of a sender to a receiving bank, transmitted orally, electronically, or in writing to pay, or to cause another bank to pay, a fixed or determinable amount of money to a beneficiary if:
(i) the instruction does not state a condition to payment to the beneficiary other time of payment,
(ii) the receiving bank is to be reimbursed by debiting an account of, or otherwise receiving payment from the sender, and
(iii) the instruction is transmitted by the sender directly to the receiving bank or to an agency, funds transfer system, or communication system for transmittal to the receiving bank.
[7] See generally Baxter & Bhala, Proper and Improper Execution of Payment Orders, 45 Bus.Law. 1447, 1461-62 (1990) (where beneficiary bank fails to accept a payment order, the originator retains title and is entitled to refund; however, where bank acquiring title is insolvent, but accepts a payment order thus acquiring title to the credit, the sender bears risk of loss and becomes a general creditor of an insolvent bank) (citing U.C.C. §§ 402, 506); Norman, Settlement Obligations and Bank Insolvency, 45 Bus.Law. 1473, 1477 (insolvency risk is on the sender). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564171/ | 16 So. 3d 200 (2009)
Reinaldo B. GARCIA, Appellant,
v.
FENCE MASTERS, INC., and AIG Claims Services, Inc., Appellees.
No. 1D08-5275.
District Court of Appeal of Florida, First District.
August 6, 2009.
*201 Bill McCabe, Longwood, and Richard J. Dolan, II of Morales, Dolan & Cerino, P.A., Hialeah, for Appellant.
John R. Darin of Znosko & Reas, P.A., Maitland, and Gonzalo Rodriguez, Fort Lauderdale, for Appellees.
PER CURIAM.
Claimant challenges an order of the Judge of Compensation Claims (JCC) denying his claim for permanent total disability (PTD) benefits. Claimant argues the JCC erred by relying on the opinion of a vocational expert retained by the employer/carrier (E/C) because the opinion was not sufficiently supported by valid data. For reasons explained herein, we reverse and remand this case for further proceedings.
Background
Claimant, a fifty-nine-year-old welder with limited education and a work history restricted to the field of welding, was displaced from his employment of sixteen years by a compensable injury to his left (non-dominant) shoulder. Claimant is fluent in Spanish, but cannot speak, read, or write in English. All of the physicians who offered opinions in this matter opined Claimant was permanently limited to sedentary or light work and could not return to his previous occupation. Instead of utilizing the reemployment and rehabilitation provisions mandated by section 440.491(1)-(9), Florida Statutes (2005), the E/C hired Richard Lopez, a vocational expert. Two days prior to final hearing, and nearly one and a half years after Claimant requested PTD benefits, Lopez performed a "labor market survey" by looking for job listings in the newspaper and on the Internet. Lopez testified he found ten jobs purportedly within Claimant's physical restrictions, and within fifty miles of Claimant's home. Lopez testified the E/C instructed him not to assist Claimant in finding work; rather, he was simply needed to identify positions within Claimant's "physical limitations." When cross-examined about the actual vocational, physical, and educational requirements of the jobs included in the labor market survey, Lopez admitted he had no knowledge as to such information. Lopez also testified he performed a transferrable skills analysis and, in essence, could not identify any skills possessed by Claimant that would transfer to lighter work. Claimant, in turn, hired a vocational expert who testified he investigated the jobs identified by Lopez, and all of them had physical, vocational, and/or educational requirements that exceeded Claimant's abilities.
The JCC's denial of PTD benefits
The JCC denied PTD benefits by finding Lopez's testimony more persuasive than that of Claimant's vocational expert and concluding Claimant was capable of performing at least sedentary work within a fifty-mile radius of his residence. From the JCC's order, however, it is not clear whether she took into consideration (in addition to Claimant's physical restrictions) vocational factors that might restrict Claimant from engaging in gainful employment. Claimant admitted, at all times relevant to these proceedings, he was physically capable of sedentary work, but was seeking PTD benefits based on his physical restrictions coupled with his vocational limitations. In the order on appeal, the JCC recited and summarized, in detail, all of the evidence introduced at trial, and *202 concluded Claimant was physically capable of at least sedentary work[*]. The parties never disputed this fact, and the JCC's conclusion does not answer the ultimate factual and/or legal issues that were presented for resolution. Because Lopez's testimony did not address the vocational factors necessary to make a determination as to Claimant's employability, the JCC's reliance on his testimony does little to inform this court whether the JCC utilized the proper legal standard in deciding Claimant's entitlement to PTD benefits.
Legal standard for establishing entitlement to PTD benefits
The statute that governs Claimant's entitlement to PTD benefits requires the JCC to determine whether the employee is unable to engage in (to obtain, or contract for the services of) at least sedentary employment within a fifty-mile radius of his residence, due to his physical limitations. See § 440.15(1)(b)5., Fla. Stat. (2005). This court has held that proper interpretation of this statute, which sets the threshold for PTD benefits for injuries occurring on or after October 1, 2003, requires the JCC to consider not only physical restrictions, but also the vocational restrictions, if any, imposed on the individual seeking benefits. See Ferrell Gas v. Childers, 982 So. 2d 36, 37 (Fla. 1st DCA 2008); see also Wal-Mart Stores, Inc. v. Thompson, 974 So. 2d 516, 517 (Fla. 1st DCA 2008).
Disposition
Here, the JCC made no finding as to which, if any, vocational impairments or factors she considered in denying benefits. Moreover, the JCC made no finding as to what, if any, employment Claimant could reasonably obtain (within fifty miles of his residence) given his particular circumstances and his physical restrictions. Instead, the JCC found, in a conclusory fashion, that Claimant was able to engage in at least sedentary work within fifty miles of his residence. Because of the noted deficiencies in the substance of Lopez's testimony, the JCC's reliance thereon does not illustrate to this court that the JCC employed the correct legal standard in analyzing Claimant's entitlement to PTD benefits. Where it is not clear the JCC employed the correct legal standard in denying PTD benefits, reversal is required. See Houck v. Lee County Bd. of County Comm'rs, 995 So. 2d 1102, 1103 (Fla. 1st DCA 2008).
By this decision we emphasize that we feel constrained to reverse because of the absence of clear, ultimate findings of fact on the essential issues presented for resolution. Because the JCC did not reject Claimant's vocational expert's testimony, but merely found Lopez's more persuasive, we remand for the entry of ultimate facts regarding Claimant's entitlement to PTD benefits based on the evidence presented at the June 4, 2008, merit hearing, and in accordance with the governing legal standards as contained in this opinion.
Claimant urges that, because Lopez's testimony was inadequate to answer the vocational questions presented and, further, because the only remaining vocational evidence (that of Claimant's vocational expert) establishes Claimant is unemployable, *203 this court should direct an award of PTD. We have previously addressed the fallacy of this type of argument. See Fitzgerald v. Osceola County Sch. Bd., 974 So. 2d 1161, 1164 (Fla. 1st DCA 2008); see also Mitchell v. XO Commc'ns., 3 So. 3d 1278 (Fla. 1st DCA 2009). We again remind the bar that the JCC sits as the finder of fact and Claimant has the burden of presenting evidence the JCC finds persuasive. See Mitchell v. XO Commc'ns., 966 So. 2d 489, 490 (Fla. 1st DCA 2007). Moreover, the JCC has the discretion to reject even uncontroverted evidence she disbelieves, and this court will not reweigh evidence on appeal. See Ullman v. City of Tampa Parks Dep't, 625 So. 2d 868, 874 (Fla. 1st DCA 1993).
REVERSED and REMANDED for proceedings consistent with this opinion.
HAWKES, C.J., and VAN NORTWICK, J., concur; BROWNING, J., concurs with separate opinion.
BROWNING, J., concurring.
If I could write on a "blank slate," I would reverse and remand with directions that the JCC enter an order awarding Claimant PTD. E/C, as a trial tactic, limited the scope of its expert's testimony to physical job availability with specific instructions that vocational factors be ignored. Because the JCC found Claimant's expert credible, but "less persuasive" than E/C's expert, there is no basis on remand for any order other than one awarding PTD. E/C had its chance to present competent evidence, failed to do so, and it should not be given an opportunity to further avoid this claim. Accordingly, I concur but would prefer to do so with a remand on a different basis from that provided by the majority opinion.
NOTES
[*] A compensation order need only contain those findings of ultimate material fact (as opposed to conclusory findings) necessary to support the mandate, and need not contain a recitation of all of the evidence presented. See § 440.25(4)(e), Florida Statutes (2005), see also Chavarria v. Selugal Clothing, Inc., 840 So. 2d 1071 (Fla.1st DCA 2003) (en banc). The common practice of using compensation orders as a means to synopsize the entirety of the record is not only unnecessarythe reviewing appellate court has the benefit of the entire recordit often creates uncertainty as to the JCC's ultimate findings and the evidence upon which such findings are based. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564141/ | 75 F.2d 880 (1935)
SOUTHWESTERN BELL TELEPHONE CO.
v.
CITY OF SAN ANTONIO, TEX., et al.
No. 7528.
Circuit Court of Appeals, Fifth Circuit.
February 25, 1935.
Rehearing Denied March 30, 1935.
James C. Henriques, of New Orleans, La., E. W. Clausen, of St. Louis, Mo., Wm. H. Duls and Nelson Phillips, both of Dallas, Tex., and E. D. Henry and L. M. Bickett, both of San Antonio, Tex., for appellant.
Bruce W. Teagarden, Carl Wright Johnson, and T. D. Cobbs, Jr., all of San Antonio, Tex., contra.
Before BRYAN, SIBLEY, and WALKER, Circuit Judges.
SIBLEY, Circuit Judge.
The Southwestern Bell Telephone Company filed a bill against the city of San Antonio and its officials to restrain the enforcement of a scale of rates for telephone service within the city which had been established on June 20, 1918, for the company's predecessor by authority of the city, asserting that the scale had become confiscatory; *881 and to enjoin interference with a higher scale which the company had proposed to the city, and which, after a hearing, had been rejected. The answer denied confiscation, and asserted that the old rates were fair and reasonable and that the company's intimate connection with the American Telephone & Telegraph Company and with the Western Electric Company was causing losses which the San Antonio exchange ought not to bear; that the Southwestern Bell and all its properties, including that in other cities and other states, was prosperous and paying fair dividends; and that its business and property in San Antonio ought not to be segregated, but if it ought there was no confiscation. On April 23, 1928, after a hearing, the court held that confiscation was shown, and enjoined temporarily the enforcement of the old scale, requiring a bond to be given by the Southwestern Bell conditioned to repay all sums collected from its patrons in excess of the old scale if it should be held that the temporary injunction was improperly granted. Under this injunction and bond, the new scale has been charged to this date. The case was referred to a special master, and on March 1, 1930, he filed a comprehensive and detailed report upholding the company in its contentions that the old rates were confiscatory and the new rates necessary to avoid confiscation. Numerous exceptions were made by the city. The decision in the case of Smith v. Illinois Bell Telephone Co., 282 U.S. 133, 51 S. Ct. 65, 75 L. Ed. 255, having appeared, the cause was re-referred to the master to take further evidence and make further report. The additional report was filed May 25, 1932, again upholding the contentions of the company. New exceptions covering 75 printed pages were filed by the city. The condensed record of the evidence covers about 3,300 pages. The court in an opinion which showed careful consideration of the case discussed many important questions of law and fact, but it was in no sense a finding of facts. (D. C.) 2 F. Supp. 611. A decree was signed March 20, 1933, from which this appeal is taken. The decree, after reciting some of the proceedings and referring to the opinion, proceeds to formulate in five numbered paragraphs the findings of the court. The first is that the suit was not prematurely brought. The second briefly finds that the master has committed error, and that his report should be set aside and held for naught. The third with equal brevity states that the court finds that the plaintiff "has failed to prove the material allegations of its bill of complaint, and that it has not been shown by satisfactory proof that the rates complained of and the ordinances upon which they are based are invalid or confiscatory." The fourth in fourteen subparagraphs points out several issues on which the plaintiff had the burden, which in the court's opinion it had not sufficiently carried, but there are no findings as to what the truth is about any issue, save that there is a qualified and tentative statement of a lump sum as the upper limit of value of property on which a return was to be earned for each year in question, and a finding that 6 per cent. was a nonconfiscatory rate of return. The fifth paragraph dissolves the temporary injunction and orders repayment of excess charges under the bond, and dismisses the bill, reserving administrative jurisdiction.
The effect of the decree is wholly to wipe out the detailed and specific report of the master, and to substitute what amounts to a general finding that the plaintiff has not proven its case. To review it, we should have to study in detail the whole of a record that it took months to make, just as though it had never been considered by a master or judge. We have nothing specific found but a rate of return. It cannot be that in more than 3,000 pages of evidence which enabled the master to make a finding on every point that nothing whatever was proven. The decree is on its face not in conformity with the Equity Rules. Rule 71 (28 USCA § 723) prescribes the general form of a decree, and prohibits putting in it anything but the effective decree or order. The findings of fact and conclusions of law required by the new rule 70½ (28 USCA § 723) are not to go into the decree, but are to "be entered of record." The very numbering of rule 70½ places it ahead of rule 71 which relates to the contents of the decree, and shows that it deals with something precedent. Whether the findings of fact are put in the decree or elsewhere is a mere matter of form, but that they shall be "special" and made "separately" from the conclusions of law is required by rule 70½, and these requirements are substantial. Neither has been met here. Cases may occur in which the evidence is insufficient as a matter of law to authorize a finding on some issue, but under the new rule there may not be a general negative finding, but there must be a special dealing with all questions and a separate stating of the facts which are found, and of the issues not found. The *882 degree of detail is a matter of judgment. Uncontested facts may be found with more generality. The contested ones should be put in such detail as will decide each contest made concerning them, the purpose of the rule being to aid review by enabling it to be restricted to the exact points on which error is claimed. In ascertaining whether there is confiscation under an imposed scale of rates we believe it to be always necessary to fix the value of the property used and useful in the service of the public; the amount of gross income received for its use; the items of expense of operation and of maintenance, and other deductions to be allowed; and the rate of return that will afford a fair compensation. These general items may involve many subcontests either of law or fact. They manifestly do in this case. The master's report upon them has been wholly discarded. A rate of return of 6 per cent. has been found, but all else has in effect been reduced to a general finding that the court is not convinced that there is confiscation. The case of Los Angeles Gas Corporation v. Railroad Commission, 289 U.S. 287, 53 S. Ct. 637, 77 L. Ed. 1180, holds that where, as here, the court is not reviewing the legislative process of rate making, but is exercising the judicial function of ascertaining whether the legislative rate conflicts with the Constitution, it is concerned not so much with the way the rate was arrived at as with its actual operation and result. But this does not mean that the court can escape separate inquiry into the necessary elements of property used, income, expense, and fair return, or fail to make the special findings required by rule 70½. When the master's results are disapproved and discarded, there ought to be another reference or else a substitution of detailed findings by the court. If evidence is lacking to meet some view of the law entertained by the court, opportunity to produce it ought to be given. If after fair opportunity sufficient proof is not had, the precise issues not proven ought to be pointed out, with the reasons why the evidence produced is insufficient. The things that are established ought to be found, so that they may definitely appear on a review without a study of the whole record. The case must be returned to the trial court for more specific rulings on the exceptions to the master's report, or if the report shall continue to be entirely rejected, for another reference or for special substituted findings by the court.
However, from the court's opinion and decree and from the argument here, it is apparent that there are some questions of importance which we can now consider and thereby aid the further trial of the cause. It appears that in tracing the historical cost of the San Antonio exchange the books available begin in 1915 with entries which are not known to be actual costs but may have arisen from appraisals or other form of estimate. These are followed by the usual entries of additions and betterments and retirements from time to time, and the account has stood as the company's investment account. We do not think these old entries ought to be regarded as mere self-serving statements which have no evidential value, or that their presence invalidates the whole evidence as to historical cost. Public utility companies are required to keep such accounts, which are the basis of periodical sworn reports. They are open to inspection by rate-fixing bodies and they always figure in rate investigations. The rates here in question were established in 1918, three years after the questioned entries were made. The rate ordinance itself recites that the applicant had made a showing, that the city officials had employed experts to analyze the showing and conduct an independent investigation into the assets, liabilities, revenues, and expenses, and the capital entitled to a return in the city of San Antonio, and had thereupon granted the increase applied for. Almost certainly these questioned entries then came under review and stood uncorrected. Since 1915, the additions and betterments recorded approach in amount the whole present value of the property as tentatively found by the court, so that the values represented by the old entries must through depreciation and replacements have largely disappeared. Compare Los Angeles Gas Corporation v. Railroad Commission, 289 U.S. 287, at page 308, 53 S. Ct. 637, 77 L. Ed. 1180. There is in litigation like this a presumption of good faith and correctness attending the basic records required to be kept by a public service corporation. West Ohio Gas Co. v. Public Utilities Commission, 55 S. Ct. 316, 79 L. Ed. ___, decided January 7, 1935; Consolidated Gas Co. v. Newton (D. C.) 267 F. 231, at page 242; Newton v. Consolidated Gas Co., 258 U.S. 165, at page 176, 42 S. Ct. 264, 66 L. Ed. 538. The questioned entries, while irregular, are a part of the property accounts and have so stood for many years, until now proof of their exact origin has become unavailable. *883 While the historical cost thus shown by the books is less satisfactory and complete than if every entry could be clearly explained and sustained, we think it evidence worthy to be received and weighed.
Another question to which far-reaching consequences have been attached arises out of the circumstance that the historical cost of the San Antonio exchange includes much equipment bought from the Western Electric Company, and that the estimates of reproduction cost are based partly on the prices quoted by that company. The Western Electric and Southwestern Bell are each practically owned and controlled by the American Telephone & Telegraph Company, though manned by different officials. The Western Electric has not a monopoly on telephone equipment such as it sells to the American Telephone & Telegraph Company and its subsidiaries, but it quotes them somewhat lower prices than it makes to independents and lower than the prices made by other manufacturers on similar equipment. This fact was held in Smith v. Illinois Bell Telephone Co., 282 U.S. 133, 135, 51 S. Ct. 65, 75 L. Ed. 255, not to be conclusive that the Western Electric prices were fair and were not a by-pass for unjust profits to the American taken from the public by means of the telephone rates, and that there should be inquiry into that question. Such inquiry was made here by examination of the managing official for many years of the Western Electric and of its books. His testimony showed an average profit over fifteen years (at a low ebb at present) of around 5 per cent. over cost in the price of the equipment sold to the Bell Companies, and of 7 per cent. annually on his company's plant allocable to the Bell business. He also produced studies tending to show that these profits were less than were earned by a number of other large manufacturers. The Western Electric Company does a great deal of business beside that with the Bell Companies, and many estimates and allocations had to be resorted to in the effort to separate the Bell business. They seem to us to be in the main reasonable, and not to be considered as mere guesses. The handling of the cost of producing new patents seems subject to just criticism. The great general prosperity of the Western Electric Company as a whole is not a demonstration of excessive profits made from the Bell business or from the San Antonio exchange. A large cash dividend is explained as mainly a distribution of the proceeds of sale of two foreign subsidiaries, without connection with the Bell business; and the ownership of stock in other subsidiaries brings in large dividends. While not conclusive, the fact that Western Electric sells at slightly higher prices to independents who could buy elsewhere, and that competing manufacturers do not undersell, is powerful evidence that the prices made to the Bell Companies are not excessive. We do not intend to foreclose inquiry into the matter, for our examination of the evidence has been casual, but we are prepared to say that a failure to make mathematical demonstration of the exact cost and profit in the things bought from Western Electric ought not to exclude their cost from the investment account, nor Western Electric prices, which are the lowest available in the market, from being considered in estimating reproduction costs.
The Southwestern Bell not only owns and operates the San Antonio exchange whose rates are fixed by the officials of that city, but also toll lines leading to other cities within and without the state of Texas for which rates are fixed by other authorities. Generally speaking, the equipment in the city is used both for local and long distance telephoning, and the company's property from the switchboard outward is used wholly in the toll service. The separate rate regulation requires a separation of the property used in each business, with some fair apportionment of or some method of compensation for that used in both businesses, and with a corresponding disposition of revenues and expenses, so that neither business will bear unjustly the burdens of the other in fixing their respective rates. Exchanges and toll lines were at first separately owned, and the toll line owner paid the exchange owner a percentage of the tolls coming from messages originating within the exchange. When the toll line owner acquired the exchange, this division of tolls was often continued, the percentage paid from the tolls being charged as an expense in the accounting of the toll business, and as income in the accounting of the exchange, a sort of rental for the use of its equipment, the exchange bearing the whole expense of operating and maintaining its property. This plan provided a return to the exchange business proportioned with some degree of accuracy to the use made of its equipment by the toll business, and capable of being fixed at a figure fair to both businesses. It apparently is the simplest method *884 of dealing with the situation, and was approved in City of Houston v. Southwestern Bell Telephone Co., 259 U.S. 318, 42 S. Ct. 486, 66 L. Ed. 961. It may be noted, however, that under it a frequent use of the exchange for nearby calls might yield it less revenue than an infrequent use for distant and more costly calls. A fixed rate per call or per minute of use might have worked more accurately. In the present case, the Southwestern Bell contends that in making both its local and its toll rates the property beyond its switchboard has alone been considered as the basis for the toll rates, while the switchboard and all else within the city has been referred to the exchange business, so that the toll rates compensate it only for extra switchboard service, the intra switchboard service on all calls being considered local and paid for by the exchange rates, just as though instead of calling "long distance" a telegraph office had been called to send a telegram. It is said that this simple view of telephone service is now almost universally adopted. The city denies this, and contends that the plan ignores the fact that in long distance telephoning the subscriber or pay station user is actually connected through the exchange equipment with the toll line and uses the whole for a toll which is paid for the communication as a unit. This view involves as a consequence an apportionment of the entire exchange property, and of the expense of operating and maintaining it, between the local and the toll business according to the use made of it by each, the amount of use to be ascertained by counting calls or by a consideration of the time consumed in them. If the toll rate for the communication be fixed so as to cover the use of the exchange property so apportioned to the toll business, the owner will be compensated for the use of all his property when exchange rates are likewise fixed on a basis of the apportionment. But if one rate-making body apportions the exchange property together with its expense and maintenance and the other does not, the inconsistency may result in serious injustice. See West Ohio Gas Co. v. Public Utilities Commission, 55 S. Ct. 316, 79 L. Ed. ___. The required apportionment has many practical difficulties which might be mitigated by legislation or by conference and agreement among the rate-making bodies. In Smith v. Illinois Bell Telephone Co., 282 U.S. 133, at page 150, 51 S. Ct. 65, 75 L. Ed. 255, the subject was considered, but the court went no further than to say that by some practical method the different uses of the property should be recognized and the return properly attributable to each service should be ascertained. We learn in Lindheimer v. Illinois Telephone Co., 292 U.S. 151, at page 155, 54 S. Ct. 658, 78 L. Ed. 1182, that an allocation on the basis of use was afterwards reached in the trial court so satisfactory that no exception was taken, but the exact formula does not appear, and the Supreme Court passed no judgment on it. If, as we understand, there is no direct legislation on this point and no specific action by the rate-making bodies concerned, we think it was the managerial right of the company to initiate a mode of dealing with the situation, but subject to control by the rate-making bodies and subject to the criticism of the court. The master upheld the company's idea of a proper treatment. The District Judge disagrees. We believe it devolves on the trial court to ascertain and point out a practicable formula, if there be one, that is better than that suggested by the company, and to permit an adjustment of the case to it. This was half-heartedly attempted on the second reference by the master, but the court has rejected these results also. If an apportionment is practicable, the method of it ought to be settled and the proof adapted to it. If none is practicable, none ought to be demanded, and some mode of adjustment should be adopted similar to the toll percentage plan above mentioned. This long and expensive litigation ought not to be thrown away because the master and the court have differed as to the rule by which the case ought to be tried. The finding of a formula for an apportionment or the finding that none is practicable seems rather a question of fact to be settled in the first instance by the trial court than one of law which the reviewing court can or ought now to attempt to solve. Groesbeck v. Duluth, S. S. & A. R. Co., 250 U.S. 607, 608, 40 S. Ct. 38, 63 L. Ed. 1167.
Besides the problem of apportionment of the investment and expense of the San Antonio exchange as a whole between the local and toll businesses, it appears that recourse to apportionment was sought as to many items (whose exact nature and amount are not stated) within the exchange both touching its investments and expenses. These apportionments were rejected by the District Judge as too speculative, largely because there was no exact separate bookkeeping for the exchange. A separate accounting system for each local exchange *885 would be a great expense to it and of little value to its ordinary operation. Problems of allocation would be of daily occurrence instead of at the wide intervals of rate-making. Efficiency and economy seem to have dispensed with such bookkeeping in all large aggregated enterprises. Its absence has never been considered an insurmountable obstacle to investigations like the present, though allocation and apportionment must be more largely resorted to because of it. Compare Rowland v. Boyle and St. Louis & S. P. R. R. Co., 244 U.S. 106, at page 108, 37 S. Ct. 577, 61 L. Ed. 1022. Some things, as for instance the salaries in and equipment of the general offices, must always be apportioned by fair estimate. Investments and expenditures which occur in all units of a system, though track has not been kept of them in each unit, may likewise be distributed by fair apportionment. Where there is nothing extraordinary in the items, and it appears that all units have participated, a reasonable basis can be found for the distribution among them. A failure to trace each of the items into its unit will not defeat their consideration. Substantial and approximate correctness is enough where perfect accuracy is not attainable. Smith v. Ill. Bell. Tel. Co., 282 U.S. 133, at page 150, 51 S. Ct. 65, 75 L. Ed. 255. We do not mean to say that unreal and baseless apportionments are to be adopted because some witness testifies to them as proper, but that courts will not be deterred by difficulties from giving a reasonable recognition to all factors that go to make the truth of the situation. That allocation is made first to the business done within a state and then to the business of particular exchanges is not "piling inference on inference," but is rather division and then subdivision. If each step in the process is based on reason and probable truth, all may be successively taken. The ideal of seeing that all elements of investment and expense receive recognition somehow is complicated by the independent jurisdictions of several rate-making bodies, but it must be steadily pursued. By creating these jurisdictions, the law has increased the difficulties, and for that very reason the courts should be astute to solve them.
We are asked to affirm the case on the ground that a depreciation so excessive is claimed as that if it be disallowed no confiscation can be shown. Lindheimer v. Illinois Bell Telephone Co., supra. Since no finding whatever was made by the District Judge on the subject of depreciation, we will attempt none. The decree should be set aside and the cause remanded for further proceedings in conformity with this opinion, the temporary injunction entered in this suit and the accompanying bond increased to an amount to be fixed by the district court to be continued pending the further litigation.
It is so ordered.
On Petition for Rehearing.
PER CURIAM.
The petition for rehearing in the above numbered and entitled cause is denied.
The motion of appellant for modification is granted, and the District Court is required to make appropriate findings with reference to the operation of the rates in question for each year up to date of the decree. Smith v. Illinois Bell Telephone Co., 282 U.S. 133, 136, 162, 51 S. Ct. 65, 75 L. Ed. 255. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564242/ | 75 F.2d 62 (1934)
In re COLLINS.
SHERMAN et al.
v.
COLLINS.
No. 10000.
Circuit Court of Appeals, Eighth Circuit.
December 20, 1934.
*63 John M. Holmes, of St. Louis, Mo. (Thompson, Mitchell, Thompson & Young, of St. Louis, Mo., on the brief), for appellants.
Before STONE, GARDNER, and VAN VALKENBURGH, Circuit Judges.
STONE, Circuit Judge.
This is an appeal from an order denying a motion to dissolve an order restraining sale of real estate to satisfy a default on a deed of trust covering the property. The appeal is by the trustee and the note holder.
In 1929, the Marner Realty Company, a Missouri corporation, executed a deed of trust upon certain real estate in St. Louis, Mo., to secure payment of a note for $60,000 (with semiannual interest notes) due April 1, 1934. The deed of trust contained the usual provisions as to payment of taxes and as to acceleration for default in payment of taxes or of interest notes. General taxes beginning with 1930 became delinquent and had to be paid by the note holder, as well as a special assessment tax. These delinquencies with an unpaid interest note total something over $9,000. Exercising the right of acceleration, the trustee, on February 8, 1934, commenced the twenty-day advertisement of sale required by the deed of trust.
The day following (February 9, 1934), the Marner Company transferred this property to David J. Collins, Sr., for an expressed consideration of $100. As matter of fact, no actual consideration was agreed to be paid or was paid by Collins. On February 12, 1934, Collins filed a debtor's petition under section 74 of the Bankruptcy Act (as amended by the Acts of March 3, 1933, 47 Stat. 1467, § 1, and of June 7, 1934, § 2, 48 Stat. 922, 923 [11 USCA § 202]). The same day, the debtor filed in that proceeding a petition to enjoin the above sale. The following day, and without notice to appellants, an order was entered restraining such sale "until further instructions of this court." The trustee and the note holder filed, on February 19, 1934 (refiled February 20, 1934), a petition to dissolve the above order and to authorize the sale to proceed. This petition, after setting forth the deed of trust and other matters leading up to the sale, contained the allegations following:
"That the said David J. Collins, Sr., was and is the sole stockholder, except for directors' qualifying shares, of the said Marner Realty Company and was and is its President; that the above described property constituted either the only asset of said corporation or substantially all of its assets; that said corporation was at the time of said transfer unable to pay its debts as they accrued in the ordinary course of business and was insolvent, and was about to lose through said foreclosure sale its principal or only asset; that your petitioners are unadvised as to the consideration paid by the said David J. Collins, Sr., but state upon information and belief that said corporation received either nothing or no substantial consideration for said deed. Your petitioners further state that the said transfer from Marner Realty Company to David J. Collins, Sr., was not a bona fide transaction, but was entered into for the purpose of hindering, delaying and defrauding the creditors of Marner Realty Company, and more particularly Mercantile-Commerce Bank and Trust Company, and that said transfer was made for the purpose of attempting to *64 prevent the sale of said property by said successor trustee through placing title in David J. Collins, Sr., with the intent and purpose of immediately filing the above entitled cause and using said proceeding as a means of preventing said sale and hindering and delaying Mercantile-Commerce Bank and Trust Company in collecting its indebtedness from said Marner Realty Company through the sale of said property; that the said transfer to David J. Collins, Sr., and the subsequent filing of this proceeding were all part and parcel of an unlawful and fraudulent scheme and device to place said property of said Marner Realty Company beyond the reach of its creditors, and particularly of Mercantile-Commerce Bank and Trust Company, and to hinder and delay said creditors, and particularly Mercantile-Commerce Bank and Trust Company, from collecting their debts against said corporation or proceeding against said property, and the said conduct on the part of said David J. Collins, Sr., constitutes a fraud upon these petitioners and upon the Court; that said transfer is void as to creditors of Marner Realty Company and particularly as to Mercantile-Commerce Bank and Trust Company."
February 23, 1934, this petition was denied, and petitioners appealed.
Evidence was introduced at the hearing on the motion to dissolve. It was admitted by the debtor that he was the owner of all of the capital stock of the Marner Realty Company, that no consideration was paid or agreed to be paid by him for the property transferred to him by the company, and that the transfer to him was made "with the contemplation that when the deed was executed and delivered debtor proceedings would be begun by the grantee." The undisputed evidence was that there was a default under the deed of trust of "about $9,000.00"; that the corporate organization and dealings were maintained as to this property.
It is difficult to understand any legal principle upon which denial of the petition to dissolve the restraining order could be based, and we are not favored by any brief or argument for appellee attempting to sustain such action. The statute expressly denies debtor petitions, for compositions and extensions, to corporations. Because of such prohibition, the Marner Company was powerless to protect itself from the result of its repeated and continued defaults under the deed of trust. The plan resulted, to convey this property to an individual who could avail himself of this statute. The purpose of the entire transaction and of every move in it was to hinder and delay a creditor in collecting a just debt then due. The recent case of Shapiro v. Wilgus, 287 U.S. 348, 53 S. Ct. 142, 77 L. Ed. 355, 85 A. L. R. 128, clearly rules the situation here. There an individual found it necessary to convey his property to a corporation in order to secure an equity receivership for the purpose of hindering and delaying two creditors who were threatening suit against him. Here a corporation finds it necessary to convey its property to an individual in order to secure the protection of this statute for the purpose of hindering and delaying its creditor from collecting a debt. The language of the court (page 355 of 287 U. S., 53 S. Ct. 142, 144), that the entire transaction was "a scheme whereby the form of a judicial remedy was to supply a protective cover for a fraudulent design," is directly applicable to the transaction here. The design there, as here, was to hinder and delay creditors.
Conveyances to hinder or delay creditors in their rights of collection or realization of payment are legal fraud both in Missouri (R. S. 1929, § 3117 [Mo. St. Ann. § 3117, p. 1946]; Citizens' Bank v. McElvain, 280 Mo. 505, 510, 511, 219 S.W. 75) and generally (First National Bank v. Flershem, 290 U.S. 504, 518, 54 S. Ct. 298, 78 L. Ed. 465, 90 A. L. R. 391; Shapiro v. Wilgus, 287 U.S. 348, 354, 53 S. Ct. 142, 77 L. Ed. 355, 85 A. L. R. 128).
Nor is appellee aided by the circumstance that he was sole owner of the stock of the corporation. While courts will look through corporate organizations to individuals where such is necessary to protect a public or a private right that is, to prevent injustice they will do so sparingly and only when such is required to prevent injustice. Obviously, it would never be done to further perpetration of a fraud. Ordinarily, the corporation will be regarded as a separate legal entity. This is true even though there be but a single stockholder. Dalton v. Bowers, 287 U.S. 404, 410, 53 S. Ct. 205, 77 L. Ed. 389; Burnet v. Commonwealth Improvement Co., 287 U.S. 415, 419, 53 S. Ct. 198, 77 L. Ed. 399; Oldham v. Chicago & N. W. Ry. Co., 52 F.(2d) 111, 114 (C. C. A. 8); Majestic Co. v. Orpheum Circuit, 21 F.(2d) 720, 724 (C. C. A. 8).
The transcript contains an order by the referee in bankruptcy (entered after this appeal) appointing a custodian to take possession of this property, manage and preserve *65 it, collect the rents, and retain custody of such proceeds until further order. Appellants urge here that the funds so arising and in the custody of the custodian should, after deduction of a reasonable fee for the custodian, be applied to reduce this indebtedness. This should be done. Since this conveyance is fraudulent as to the creditors of the corporation, it is clear that the income from this property is income of the corporation in so far as the rights of its creditors are concerned. Under no theory can the creditors of the individual (Collins) have any rights thereto equal to those of the corporate creditors. Therefore the funds of the custodian should be devoted to satisfaction of the corporate debts. The undisputed evidence is that there are no corporate debts except this one. Hence the funds, less a reasonable allowance to the custodian, should be paid over to appellant Mercantile-Commerce Bank & Trust Company (the note holder here) to be applied upon this indebtedness.
The case is remanded, with instructions to enter an order or orders dissolving the restraining order, permitting sale under the deed of trust, and paying over funds of the custodian, all in accordance with this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564325/ | 16 So. 3d 955 (2009)
Wayne Eugene RACINE, Appellant,
v.
STATE of Florida, Appellee.
No. 5D08-1502.
District Court of Appeal of Florida, Fifth District.
August 21, 2009.
*956 James S. Purdy, Public Defender, and Anne Moorman Reeves, Assistant Public Defender, Daytona Beach, for Appellant.
Bill McCollum, Attorney General, Tallahassee, and Allison Leigh Morris, Assistant Attorney General, Daytona Beach, for Appellee.
SAWAYA, J.
The defendant, Wayne Racine, was convicted after a bench trial of the crimes of battery of a person sixty-five years old or older and battery. His attorney apparently filed a written motion waiving a jury trial, and the trial court entered an order granting that motion. Racine complains, and properly so, that he did not waive his right to a jury trial and seeks reversal of his convictions and a new trial.
The Florida Constitution guarantees to each citizen that the "[t]he right of trial by jury shall be secure to all and remain inviolate." Art. I, § 22, Fla. Const.; see also Art. I, § 16, Fla. Const. (providing that the accused shall "have a speedy and public trial by impartial jury"). "[A] defendant's right to a jury trial is indisputably one of the most basic rights guaranteed by our constitution...." State v. Griffith, 561 So. 2d 528, 530 (Fla.1990).[1] This guarantee is also contained in the United States Constitution.[2]
The error committed by the trial court is that it conducted a bench trial without obtaining a proper waiver from Racine of his right to trial by jury. For a waiver of the right to jury trial to be valid, a waiver form must be signed by the defendant or the defendant must orally waive that right after a proper colloquy with the trial court. Johnson v. State, 994 So. 2d 960 (Fla.2008); Smith v. State, 9 So. 3d 702, 704 (Fla. 2d DCA 2009) ("A valid waiver of a criminal defendant's right to a jury trial requires either a written waiver signed by the defendant or the defendant's oral waiver after a proper colloquy with the trial judge.").
The record before us contains neither a written waiver form nor a transcript showing that Racine orally waived his right to a jury trial before the trial court. The motion signed by Racine's attorney does not constitute a proper and valid waiver by *957 Racine. See State v. Upton, 658 So. 2d 86 (Fla.1995). We note, parenthetically, that the State concedes the error. Accordingly, we reverse Racine's convictions and sentences.
REVERSED and REMANDED.
PALMER and EVANDER, JJ., concur.
NOTES
[1] In Johnson v. State, 994 So. 2d 960 (Fla. 2008), the court recently explained that
criminal defendants have a right to a jury trial for serious crimesi.e., those that "have a maximum penalty of more than six months' imprisonment or more than a $500 fine"but not petty offensesi.e., those that "have a maximum penalty of six months' or less imprisonment or a $500 or less fine." Reed v. State, 470 So. 2d 1382, 1383 (Fla.1985); see also Whirley v. State, 450 So. 2d 836, 839 (Fla.1984) ("[T]he federal petty crime exception to the jury trial requirement in criminal prosecutions is also an exception under our own constitutional provision.") (citing Aaron v. State, 345 So. 2d 641 (Fla. 1977); Aaron v. State, 284 So. 2d 673 (Fla. 1973)).
Id. at 962-63. Clearly, Racine had a right to a trial by jury for both crimes he was charged with.
[2] U.S. Const. art. III, § 2, cl. 3 ("The Trial of all Crimes, except in Cases of Impeachment, shall be by Jury; and such Trial shall be held in the State where the said Crimes shall have been committed; but when not committed within any State, the Trial shall be at such Place or Places as the Congress may by Law have directed."); U.S. Const., amend. VI ("In all criminal prosecutions, the accused shall enjoy the right to a speedy and public trial, by an impartial jury of the State and district wherein the crime shall have been committed, which district shall have been previously ascertained by law....") | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564275/ | 16 So. 3d 1178 (2009)
Jerry L. LaFLEUR
v.
M. LANGENSTEIN & SONS, INC.
No. 2009-CA-0140.
Court of Appeal of Louisiana, Fourth Circuit.
July 15, 2009.
*1179 Charlsey Wolff, Wolff & Wolff, New Orleans, LA, for Plaintiff/Appellee.
W. Michael Stemmans, M. Todd Alley, Michael J. Taffaro, Jennifer E. Frederickson, Stemmans & Alley, Baton Rouge, LA, for Defendant/Appellant.
(Court composed of Judge CHARLES R. JONES, Judge JAMES F. McKAY, III, and Judge DENNIS R. BAGNERIS, SR.).
CHARLES R. JONES, Judge.
The Appellants, M. Langenstein & Sons, Inc. (Langenstein's), appeal a judgment of the Office of Workers' Compensation, District 8, State of Louisiana, the Honorable Diane Lundeen, who granted to complainant, Jerry LaFleur, an award for workers' compensation benefits. Complainant answered the appeal, seeking attorney's fees. We affirm, and deny the answer to this appeal.
Ms. Jerry LaFleur was employed by defendant Langenstein's on November 21, 2005, as an assistant produce buyer. Pursuant to Ms. LaFleur's employment, Mr. Mike Lanaux, general manager and co-owner of Langenstein's, conducted a telephone interview regarding prospective employment with Ms. LaFleur while she was still living in Florida. During this interview, Ms. LaFleur stated she was in good health and failed to disclose any prior injuries or physical impairments to Mr. Lanaux. Ms. LaFleur also informed Mr. *1180 Mike Lanaux that lifting objects on the job would not present a problem in terms of her fulfilling the job requirements at Langenstein's.
The instant claim arose out of an accident that occurred on September 5, 2006, during the course and scope of Ms. LaFleur's employment. On this date, Ms. LaFleur, while in the process of restocking produce at the end of the work day, felt a pain in her neck which seemed as though she had pulled a muscle. While reaching for a crate of melons Ms. LaFleur figured she had just pulled a muscle and disregarded the pain. Ms. LaFleur continued to work until September 11, 2006, at which time she reported the incident to her supervisor, Mr. Lanaux. There had been almost a week in between the date of this incident and the date she reported the accident to her employer. At trial, Ms. LaFleur testified that she failed to disclose the pain to her employer on September 5th because she hoped the pain would subside. However, she noted that she reported when it would not subside and worsened. After reporting the incident, she was referred to visit Dr. Lee Moss at the Southern Orthopedic Specialists to receive treatment for the injury. Dr. Moss eventually referred Ms. LaFleur for surgery by Dr. Corales, a neurosurgeon. However, the surgery was eventually denied because Langenstein's terminated Ms. LaFleur's workers' compensation benefits.
As a requirement of Ms. LaFleur's workers' compensation claim, she was required to fill out a Second Injury Fund Questionnaire. This questionnaire inquired about a person's prior medical history and previous disabling injuries. Ms. LaFleur answered in the negative to each question concerning her having had prior injuries, with the exception of diabetes. Langenstein's obtained medical records of Ms. LaFleur from healthcare providers in Florida, since she previously resided there and she had provided appellant with the authority to retrieve all her past medical records. The records indicated a history of fibromyalgia and headaches and a past cervical MRI obtained on Ms. LaFleur. The results of the cervical MRI indicated right side headaches and head injury, presumably, an injury from a prior fall at her former employment, Eve's Market.
In an effort to further investigate Ms. LaFleur's workers' compensation claim, Mr. Phil Moory, another employee of Langenstein's, obtained a recorded statement from Ms. LaFleur in an effort to clarify Ms. LaFleur's treatment. Mr. Moory stated that this recorded statement was necessary because Ms. LaFleur's previous medical records were in direct conflict with information she had provided to her physicians in Louisiana, statements made to Mr. Lanaux at the time of hire, the report of past medical issues to the initial uptake adjuster, and also on the second injury fund questionnaire.
During the recorded statement, Ms. LaFleur repeated the exact same answers she had provided on all the previous questionnaires. Upon completion of the recorded statement, Mr. Moory opined that Ms. LaFleur was making statements that were false and in direct contradiction to evidence in the possession of the adjuster. At trial, Mr. Moory testified that Ms. LaFleur misled him and he stated that he terminated Ms. LaFleur's workers' compensation benefits in its entirety because, as he testified, that in addition to making false statements to him, Ms. LaFleur also misrepresented her medical conditions to Langensteins. Mr. Moory testified that Ms. LaFleur had informed Mr. Lanaux that she had no physical problems and that she was in good health. Furthermore, when faced with the second injury fund *1181 questionnaire, Ms. LaFleur did not complete it accurately.
As a result of the termination of benefits, Ms. LaFleur filed suit against Langenstein's for worker's compensation benefits. Trial was held on this matter over three days, May 22, 2008, May 27, 2008, and again on May 30, 2008, before the honorable Dianne Lundeen of District 08, Office of Workers' Compensation. A written judgment was prepared and signed by the court on October 23, 2008. The judgment determined that Ms. LaFleur was injured on September 5, 2006, by an accident in the course and scope of her employment. Judge Lundeen ordered that Langenstein's must pay for and authorize the surgery recommended by Dr. Corales, and awarded Ms. LaFleur ongoing medical care that is necessary and related to her work-related accident. Additionally, Ms. LaFleur was entitled to supplemental earning benefits at a zero earning capacity beginning March 9, 2007 through May 30, 2008. Finally, Judge Lundeen determined that Ms. LaFleur did not violate La. R.S. 23:1208 or La. R.S. 23:1208.1. Langenstein's subsequently filed this timely appeal.
In the instant matter Langenstein's raises three assignments of error:
1) The workers' compensation judge committed manifest error in finding that Jerry LaFleur did not violate Louisiana Revised Statute 23:1208.1
2) The workers' compensation judge committed manifest error in finding that Jerry LaFleur did not violate Louisiana Revised Statute 23:1208.
3) The workers' compensation judge committed manifest error in finding that Jerry LaFleur met the burden of proof regarding the occurrence of an accident.
Ms. LaFleur answered the appeal, seeking from this court an award of attorney fees in the trial court presentation, and additional attorney fees for work on the appeal.
An appellate court cannot set aside a trial court's finding of fact in the absence of "manifest error" or unless it is "clearly wrong" based on evidence without evidentiary support. Rosell v. ESCO, 549 So. 2d 840 (La.1989). Thus, the issue is not whether the trier of fact is right or wrong, but rather whether the fact finder's conclusion is a reasonable one. Id. In Mart v. Hill, 505 So. 2d 1120, 1127 (La.1987), the Supreme Court set out a two part test for the reversal of fact finder's determinations:
1) The appellate court must find for the record that a reasonable factual basis does not exist for the finding of the trial court.
2) The appellate court must further determine that the record establishes that the finding is clearly wrong (manifestly erroneous.)
In Langenstein's first and second assignments of error, Langenstein's argues that the trial court committed manifest error in finding that Ms. LaFleur did not violate Louisiana Revised Statute 23:1208.1, forfeiture of benefits. Louisiana Revised Statute 23:1208.1 states in pertinent part:
Nothing in this Title shall prohibit an employer from inquiring about previous injuries, disabilities, or other medical conditions and the employer shall answer truthfully; failure to answer truthfully shall result in the employee's forfeiture; failure to answer truthfully shall result in the employee's forfeiture of benefits under this Chapter, provided said failure to answer directly relates to the medical condition for which a claim for benefits is made or affects the employer's ability to receive reimbursement from the second injury fund.
*1182 In order for this section to apply, the party seeking relief must prove three things: 1) there must be an untruthful statement; 2) prejudice to the employer; and 3) compliance with notice requirement of the statute. All three of these elements must be met in order for the statute to be applied.
In examining section 1208.1, we must first examine whether there was an untruthful statement made by the plaintiff to the employer, Langenstein's. Although Langenstein's continuously inquired of Ms. LaFleur about her previous medical history, she did not make any misleading or untruthful statements. While she did not disclose her previous medical history and past injuries which she had incurred at her past employment, Ms. LaFleur did disclose her diabetes, the sickness which she was suffering with and had incurred at the time before her employment. During the pre-employment telephone interview with Mr. Lanaux, Ms. LaFleur testified that she was not suffering from any disabling illness or injuries. Even Mr. Lanaux testified at trial that until the said injury at Langenstein's, Ms. LaFleur had never complained of any pains or injuries. Ms. LaFleur performed her job exceptionally and in turn, received a raise from Langenstein's authorized by Mr. Lanaux. At the time Ms. LaFleur received the raise, she had been employed at Langenstein's for nine (9) months
Further, while filling out the second injury fund questionnaire provided by Langenstein's, Ms. LaFleur provided and checked all relevant sicknesses she had at the time listed on the questionnaire. She checked diabetes because it was on the list. She did not check the fibromyalgia which she had for many years because it was not requested on the list. Also, Ms. LaFleur did not state her past injuries to her knee and back on the questionnaire because according to her, these injuries were not disabling injuries. These past injuries were not a constant reminder nor thought of by her because they happened years ago, and since receiving treatment, she barely remembered them. When asked at trial why she failed to state these past injuries to the manager, on the questionnaire, to Mr. Moss, and to Mr. Moory, Ms. LaFleur stated that she had forgotten all about them and could not remember which knee she had injured.
In its reason for judgement, the trial court stated:
Defendant argued that Ms. LaFleur violated Louisiana Revised Statute 23:1208.1 because she did not disclose a ten year old knee injury, hypertension or disability on the second injury fund questionnaire. However, as is noted in Ms. LaFleur's claim, she injured her neck in the subject accident and filed a claim based on the need for medical care related to her neck, not her knee or her hypertension. Ms. LaFleur testified credibly that she had forgotten about the old knee injury which had fully resolved and which had no bearing to any of the body parts she hurt in this accident. Further, there was no evidence that Ms. LaFleur had any `impairment" that precluded her from engaging in gainful employment at a heavy duty level prior to the subject accident. When Ms. LaFleur's filled out the second injury fund questionnaire, her understanding was that physical impairment or disability meant a condition that interfered with or precluded one from working. This is reasonable evidence and testimony of Ms. LaFleur's work history from both her former long term employer and defendant. Defendant substantiated that Ms. LaFleur did not demonstrate any form of inability to work at any capacity prior to the subject accident *1183 and that Ms. LaFleur worked without limitations or complaints.
Ms. LaFleur testified in court that she filled out the second injury fund questionnaire as truthful and honestly as she could ... Most importantly, she did not acknowledge a prior neck injury because she never had a neck injury. Mr. Moory incorrectly assumed that because a prior cervical MRI was performed on Ms. LaFleur in 2002, that a) Ms. LaFleur suffered a prior neck injury. b) she was disabled and not as employable; and c) the employer/insurer would have recovered from the fund. The clinical history from the cervical MRI test results indicates right side headaches and head injury, presumably, the result of a prior fall at her previous place of employment. There was no evidence that this diagnostic test was ordered as a result of a neck injury suffered by Ms. LaFleur.
Thus, as the trial court found, Ms. LaFleur did not provide Langenstein's with untruthful statements. Ms. LaFleur did not intentionally try to conceal information about her past treatments and injuries from defendant for the sole purpose of obtaining workers' compensation. She did not disclose the information about her past knee injury and fibromyalgia because she thought it did not relate to the injury which she suffered during the course and scope of her employment at Langenstein's.
In King v. Grand Cove Nursing Home, 93-779 (La.App. 3 Cir. 3/9/94) 640 So. 2d 348, cert. denied, 641 So. 2d 204 (La.1994), the Third Circuit refused to enforce the forfeiture provisions of section 1208.1 when a nurse's aide injured her back while lifting a resident. Although she had suffered prior cervical and back strain prior to her work-related accident and failed to note these when asked on the forms provided by her employer if she had any trouble with her back, the Court found that the history of her prior back strains did not "directly" relate to the medical condition which was the subject of the workers' compensation claim.
Langenstein's discontinued Ms. LaFleur's workers' compensation benefits on the basis that she did not disclose a prior knee injury she suffered in 1996 for which she received treatment. Langenstein's also states that it terminated Ms. LaFleur's benefits when it recovered her medical records which revealed a cervical MRI she had about a year prior to the accident. However, there is no evidence in the medical records or the trial court record indicating that the MRI was for a neck injury as Langenstein's asserts. Our review of the record indicates that the MRI was ordered because of headaches and stress headaches resulting from the fibromyalgia. The fibromyalgia which Ms. LaFleur had, manifested itself in the form of somatic pain throughout her body and not a specific body part. Thus, considering all the evidence provided, we agree with the trial court that Ms. LaFleur did not make any untruthful statements to Langenstein's.
In Lebert v. McNeese State University, 2005-856 (La.App. 3 Cir. 2/1/06), 932 So. 2d 678, 685, the court found that an alleged false testimony to physician of choice did not warrant a finding of fraud where the employee's recollection was not relevant to the determination of his benefits. In the matter sub judice, the trial court found Ms. LaFleur to be credible when she stated that she did not disclose her past injuries because she merely forgot about them. This finding of fact is not manifestly in error nor clearly wrong.
The second element of La. R.S. 23:1208.1 is to prove prejudice to the employer by the employee:
*1184 Statements that prejudice the employer are those untruthful answers that directly relate to the medical condition for which a claim for benefits is made or affects the employer's ability to receive reimbursement from the second injury fund.
In Wise v. J.E. Merit Constructors, Inc., 97-C-0684 (La.1/21/1998), 707 So. 2d 1214, the Supreme Court determined that "a direct relation is established when the subsequent injury was inevitable or very likely to occur because of the presence of the preexisting condition." Id., 707 So.2d at 1220. The record indicates that though there was a cervical MRI taken of Ms. LaFleur, it is not evident that it was taken because of a neck injury. The trial court specifically found Ms. LaFleur to be a credible witness regarding the clinical indication of headaches as an explanation for the ordering of a cervical MRI. None of Ms. LaFleur's prior injuries relate to the injury which Ms. LaFleur suffered during the course and scope of her employment. Langenstein's alleges that Ms. LaFleur is claiming to have incurred an accident at work which will result in a surgery to her neck, specifically a fusion at C-6. Langenstein's also asserts that this is the same disc that has been protruding for quite some time. Thus, it would follow that further injury to Ms. LaFleur's neck was "inevitable and very likely to occur" because of the pre-existing herniation.
Langenstein's allegations are without merit because while the Florida medical records indicated a cervical MRI performed on Ms. LaFleur, there is no evidence that it was for a neck injury, specifically to the C-6 fusion of Ms. LaFleur's neck. None of Ms. LaFleur's prior injuries relate to the present injury for which she seeks workers' compensation benefits. Therefore, the trial court did not err in finding that defendant failed to prove this second element and providing that plaintiff's actions were to prejudice the defendant. Hence, we find that this assignment of error has no merit.
The third element of section 1208.1 is that the written compliance with the notice requirement of the statute must be complied with La. R.S. 23:1208.1. The written medical form concerning previous medical conditions contain a notice advising an employee of the forfeiture of benefits if one fails to answer truthfully. "Such notice shall be prominently displayed in bold faced block lettering of no less than ten point type." Id. Langenstein's asserts that the second injury fund questionnaire met these requirements because a warning notice was labeled at the bottom of the second injury fund questionnaire which was provided to Ms. LaFleur. The trial court found that when Ms. LaFleur filled out the second injury fund questionnaire, she reasonably interpreted the language on the form relating to a physical impairment or disability to mean a condition that would impair or preclude her from presently working. Ms. LaFleur did not state her past injuries on the questionnaire because, she thought, the questionnaire inquired about disabling injuries. According to Ms. LaFleur, none of her past injuries could be considered disabling or life altering; importantly, they did not prevent her from continuing employment, so she did not report them. The trial court accepted this explanation as truthful and found her credible. Our review of the record indicates this factual determination is not manifestly in error, nor clearly wrong. Therefore, we find that Langenstein's has failed to prove a violation of truthfulness in relation to the statute. The trial court's determination that Ms. LaFleur failed to violate La. R.S 23:1208.1 was not manifestly erroneous, nor clearly wrong.
*1185 Langenstein's third assignment of error is that the workers' compensation court erred and committed manifest error in finding that Ms. LaFleur met the burden of proof regarding the occurrence of an accident. La. R.S. 23:1031 states that, as a threshold requirement, a worker in a compensation action must establish "personal injury by accident arising out of and in the course and scope of his employment." The Louisiana Supreme Court in Lucas v. Insurance Company of North America, 342 So. 2d 591 (La.1977) stated the principle of presumption as to causal connection between accident and injury as follows:
A claimant's disability is presumed to have resulted from an accident the injured was in good health, but commencing with the accident, the symptoms of the disabling condition appear and continuously manifest themselves afterwards, providing that the medical evidence shows there to be a reasonable possibility of causal connection between the accident and the disabling condition. Id. 342 So.2d at 596.
The trial court in its reasons for judgment focused on the credibility of the claimant. The court stated "in determining whether a worker has shown by a preponderance of the evidence that an injury causing accident occurred in the course and scope of employment, the trier of fact is expected to focus on the issue of credibility because, absent contradictory circumstances and evidence, a claimant's testimony is accorded great weight." Citing Jackson v. Quikrete Products, Inc. 816 So. 2d 338, (La.App. 4 Cir.2002). In this present case, the claimant's accident occurred while she was alone in a produce cooler at defendant's employment. She testified that she was in the cooler alone and defendant's store manager, Mr. Lanaux also testified that it was not uncommon for employees to be alone in the cooler, especially while carrying produce. Moreover, the trial court found that Ms. LaFleur had a work injury on September 5, 2006, and noted that the store manager testified that he had no reason to believe that the accident did not happen as Ms. LaFleur stated. Although she did not report the accident on that exact date because she thought she had just pulled a muscle, she reported the injury when the pain persisted and worsened. Her failure to report the injury on September 5, 2006, but rather almost a week later, does not support the conclusion that an injury did not occur during the course and scope of her employment.
Furthermore, because defendant's manager found Ms. LaFleur to be very credible and truthful, he referred her to his family physician for treatment. While Ms. LaFleur had some pre-existing medical conditions, as well as diabetes prior to the subject accident, none of her pre-existing medical conditions related to or was a causal connection to the area of the body which was injured during her employment. Ms. LaFleur's neck injury for which she seeks treatment and benefits resulted from an accident at work. Because she was in good health prior to the accident, but commencing with the accident, the symptoms of the disabling condition appeared and continuously manifested itself afterwards. Ms. LaFleur's pain continued, and even though Dr. Moss ordered her to sustain from work for several weeks, the pain did not subside. Dr. Moss, due to Ms. LaFleur's ongoing pain presentation and herniated discs, referred her to Dr. Richard Corrales, a neurosurgeon, who later recommended Ms. LaFleur for surgery-an anterior discectomy and fusions at C5-6. All of Ms. LaFleur's medical records, both past and present, indicates that there is a reasonable possibility of a causal connection between the accident which occurred while Ms. LaFleur was in the cooler at work, and the disabling condition. This *1186 assignment of error is without merit and the workers' compensation court did not commit manifest error, nor was it clearly wrong in concluding that Ms. LaFleur suffered an accident during the course and scope of her employment.
Finally, in Ms. LaFleur's answer to the appeal, she requests an award of attorney fees for having prevailed in the trial court, and additional attorney fees for work on the appeal. The trial court did not award attorney's fees. The failure to award attorney fees is a factual determination by the trial court. And our review of the record indicates that this factual determination was not manifest error nor clearly wrong. Further, "an increase in attorney fees should be awarded to a party who has already been awarded attorney's fees by the trial court and then successfully defends on appeal." Saacks v. Mohawk Carpet Corporation, XXXX-XXXX (La.App. 4 Cir. 09/03/03), 855 So. 2d 359. In this instance, Ms. LaFleur cannot be award additional attorney fees since there were no attorney fees awarded in the trial court.
DECREE
For the foregoing reasons, the judgement of the office of workers' compensation ordering M. Langenstein & Sons, Inc., to pay for the authorized surgery recommended by Dr. Corrales; and that the claimant is entitled to ongoing medical care that is necessary and related to the subject accident; and that Ms. LaFleur is entitled to supplemental earning benefits at a zero earning capacity beginning March 9, 2007 through May 30, 2008; and finally, determining that Ms. LaFleur did not violate La. R.S. 23:1208 or La. R.S. 23:1208 is affirmed.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564308/ | 16 So. 3d 1176 (2009)
Patrick D. BREEDEN
v.
Linda C. WINFREY.
No. 2009-CA-0325.
Court of Appeal of Louisiana, Fourth Circuit.
July 15, 2009.
Patrick D. Breeden, New Orleans, LA, in Proper Person.
Ian E. Goldenberg, Ian E. Goldenberg, L.L.C., New Orleans, LA, For Defendant/Appellee.
(Court composed of Judge PATRICIA RIVET MURRAY, Judge MICHAEL E. KIRBY, Judge TERRI F. LOVE).
MICHAEL E. KIRBY, Judge.
Plaintiff, Patrick D. Breeden, appeals the trial court judgment granting the peremptory exception of prescription filed by defendant, Linda C. Winfrey.
On March 4, 2008, plaintiff filed a Petition to Enforce Judicial Mortgage against the defendant. In that petition, plaintiff alleged that he was the attorney of record for defendant in the matter of Linda C. Winfrey v. Joseph H. Robichaux, CDC *1177 No.XXXX-XXXXX, Division J-13. The petition further alleged that in the Winfrey v. Robichaux case, the trial court rendered judgment on January 12, 2005 in favor of Ms. Winfrey, ordering Mr. Robichaux to pay her $1,300.00 in damages and to convey the immovable property located at 1810-12 Third Street in New Orleans within 60 days of the judgment.
Plaintiff alleged that on February 15, 2005, he filed an affidavit for "Attorney and Fees Lien" against the Third Street property in accordance with La. R.S. 9:5001 and/or La. R.S. 37:218. He alleged that the contract that defendant signed with him stated that his fee was 40% of any amount recovered for defendant. He alleged that along with the affidavit, he filed a copy of his contract with the defendant and a copy of the January 12, 2005 judgment. Plaintiff further alleged that he has not been able to collect his fee, and asked the court to order the sale of the property so he can collect his fee. Plaintiff notified the trial court of the name and address of defendant's current attorney.
In response to plaintiff's petition, the defendant filed peremptory exceptions of no cause of action and prescription. The exception of no cause of action was based on the grounds that plaintiff failed to state a legally recognizable cause of action for an attorney's ownership interest in defendant's immovable property based on a contingency fee agreement in a specific performance lawsuit. The exception of prescription was based on the grounds that plaintiff failed to file his petition against the defendant within three years of the January 12, 2005 judgment in Civil District Court Case Number XXXX-XXXXX, Division "J", entitled Linda C. Winfrey v. Joseph H. Robichaux. In support of her exceptions, defendant attached a memorandum and her affidavit.
In opposition to the defendant's exceptions, plaintiff filed a memorandum; invoices sent to defendant for services rendered; a copy of a letter sent to plaintiff from the Louisiana Attorney Disciplinary Board informing him that a complaint filed against him by defendant had been dismissed; his affidavit for "Attorney and Fees Lien;" his contract with defendant; the January 12, 2005 trial court judgment in the Winfrey v. Robichaux case and the trial court's reasons for judgment in that case; the Notice of Lis Pendens filed on behalf of defendant; a letter dated August 5, 2005 from plaintiff to Mr. Robichaux's attorney (with a copy to the attorney now representing defendant) regarding costs; a response letter dated August 11, 2005 from Mr. Robichaux's attorney addressed to plaintiff and defendant's current attorney, referring to plaintiff as defendant's "former attorney;" and a Motion to Deposit Funds Into the Registry of the Court filed by Mr. Robichaux's attorney.
Following a hearing on September 19, 2008, the trial court rendered judgment on September 29, 2008 granting defendant's peremptory exception of prescription, and designated that ruling as a final judgment. Plaintiff now appeals that judgment.
At the hearing held on September 19, 2008, the trial court stated that it was granting defendant's exception of prescription pursuant to Louisiana Civil Code article 3494, which states that an action for the recovery of compensation for services rendered, including payment of professional fees, is subject to a prescriptive period of three years. After reviewing the relevant documents, the trial court found that the last action taken by plaintiff in representing defendant was on or around February 11, 2005 and/or, at the latest, February 14, 2005. The court noted that plaintiff's own invoices/time sheets reflect that he no longer would be representing *1178 the defendant as of February 17, 2005. Because the instant lawsuit was not filed by plaintiff until March 4, 2008, the court granted defendant's exception of prescription, and stated that this ruling made it unnecessary to rule on the defendant's exception of no cause of action. The court specified that it was not ruling on the issue of plaintiff's lien. The court designated its ruling on the exception of prescription as a final judgment, making it immediately appealable.
On appeal, plaintiff argues that the trial court erred in granting defendant's exception of prescription. Plaintiff contends that his March 4, 2008 petition asked only for recognition of his lien and privilege granted to attorneys under La. R.S. 9:5001 and La. R.S. 37:218 for recovery of their professional fees and costs. Alternatively, he contends that he performed work for defendant until August 1, 2005.
Louisiana Civil Code article 3494 states, in pertinent part:
The following actions are subject to a liberative prescription of three years:
(1) An action for the recovery of compensation for services rendered, including payment of salaries, wages, commissions, tuition fees, professional fees, fees and emoluments of public officials, freight, passage, money, lodging, and board.
A review of the record, including the invoices submitted by plaintiff in opposition to defendant's exceptions, supports the trial court's finding that plaintiff did not perform any work on defendant's behalf beyond February 2005. Even though plaintiff asserted his right to a lien and privilege in his petition of March 2008, this action was an attempt to recover compensation for services rendered to his client. As such, it is subject to the prescriptive period set forth in La. C.C. article 3494. The last action taken by plaintiff on behalf of his former client, the defendant, was in February 2005. Therefore, the petition filed in March 2008 was prescribed under the provisions of La. C.C. article 3494. Accordingly, we find no error in the trial court's granting of defendant's exception of prescription.
For the reasons stated above, the trial court judgment is affirmed.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564315/ | 16 So. 3d 829 (2009)
ROBINSON
v.
STATE.
No. 4D09-2349.
District Court of Appeal of Florida, Fourth District.
September 30, 2009.
Decision without published opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564293/ | 16 So. 3d 514 (2009)
Philip BELL, Franklin Mercantile, IIII, Inc. and First Franklin Company, Inc.
v.
Charles G. GLASER.
No. 2008-CA-0279.
Court of Appeal of Louisiana, Fourth Circuit.
July 1, 2009.
*515 Kearney S. Loughlin, New Orleans, LA, for Plaintiffs/Appellants.
J. Don Kelly, Jr., Provosty & Gankendorff, L.L.C., New Orleans, LA, for Defendant/Appellee.
(Court composed of Judge CHARLES R. JONES, Judge JAMES F. McKAY, III, and Judge DENNIS R. BAGNERIS, SR.).
CHARLES R. JONES, Judge.
The Appellant, Philip Bell, seeks review of the district court's judgment in favor of the Appellee, Dr. Charles Glaser, sustaining his exception of prescription. We affirm.
On February 19, 1993, Mr. Bell entered into a sublease for commercial property with Dr. Glaser for a Mail Boxes, Etc. franchise at 630 South Carrollton Avenue in Orleans Parish. The owner of the building was Slatten Realty Company (hereinafter referred to as "Slatten"), which leased the building to Dr. Glaser for a period of 15 years: April 1, 1985 through March 31, 2000. The original sublease to Mr. Bell was for the term of March 1, 1993 to March 1, 1994, with two options to extend for either a three year period or another year.
The Primary Lease terms between Slatten and Dr. Glaser regarding roof repair were:
... Lessee assumes responsibility for the condition of the premises and Lessor will not be responsible for damage caused by leaks in the roof, by bursting pipes, by freezing or otherwise, or by any vice or defects of the leased property, or the consequences thereof except in the case of positive neglect or failure to take action toward the remedying of such defects within reasonable time after having received written notice from Lessee of such defects and the damage caused thereby. Should Lessee fail to promptly notify Lessor, in writing of any such defects, Lessee will become responsible for any damage resulting to Lessor or other parties. [Emphasis added.]
The addendum to the Primary Lease regarding roof repairs and the sublease provides:
(1) Lessee agrees to do all interior and exterior renovations and improvements at his own expense except for roof repairs.
(2) Lessee agrees to maintain all leased areas set forth in this lease, both interior and exterior, excluding roof maintenance and repairs.
(3) Lessee to be granted the right to sublease, but will remain liable for lease if sub-lessee becomes unable to pay his rent. [Emphasis Added].
Lastly, the sublease terms between Dr. Glaser and Mr. Bell states in pertinent part:
7. This is a sublease of the above-described property, covered by primary lease from April 1, 1985 through March 31, 2000, dated March 26, 1985, a copy of which is attached hereto, and all of the terms and provisions of said primary lease are incorporated in and shall be considered a part of this sublease to the extent applicable and where not inconsistent with the terms and provisions of this sublease, except that sublessee's rights or renewal shall be specified in Paragraph 8 of this sublease. [Emphasis Added].
8(d). Sublessee shall have the right, with one hundred twenty (120) days prior to written notice, to extend this lease *516 for an additional 2 terms: commencing immediately upon the expiration of the primary term and first option provided above and ending March 31, 2000, upon the same terms and conditions, including rental increase on the same schedule as during the primary term. The [sic] first option period is a term of three years and the [sic] second option period ends March 31, 2000. [Emphasis Added].
Mr. Bell extended the lease for an additional three (3) years through March 1, 1997. He had the only Mail Boxes, Etc. franchise in the area from Birmingham, Alabama to Houston, Texas. Since Mr. Bell had an exclusive franchise, he had the right to share in the royalties of all franchises in the area so long as he provided a training center (which he provided) at the Carrollton location.
In the fall of 1994, after extending the lease through 1997, Mr. Bell noticed water intrusion in the ceiling in the rear bathroom portion of the building. In November 1994, a water leak appeared again. This time the leak occurred in the administrative offices of the building causing damage to the carpet, countertops and desks. One month later in December 1994, more water leaking occurred, causing damage to the mid-section of the building, carpet, countertops, and desks. In February 1995, water began leaking from the ceiling again through light fixtures. Due to the ongoing leaking, Mr. Bell sent a letter on March 10, 1995, describing the damages suffered and the costs of repairs already undertaken. The letter noted damages to copy equipment, cabinets, etc. A total of $8,053.86 in damages was sought.
On April 28, 1995, Mr. Bell sent a second letter to Dr. Glaser giving him notice that he was going to terminate his lease effective May 30, 1995. On May 9, 1995, the business again experienced flooding from the roof. This time the damage was widespread, and led Mr. Bell to write another letter to Dr. Glaser that same month. In addition to major problems, the letter noted that the building was uninhabitable for the purpose for which it was leased. It follows that as of May 30, 1995, the lease was cancelled at Mr. Bell's request and all contractual relations between both parties ceased. Subsequently, Mr. Bell brought suit against Dr. Glaser in 1999; however, the suit was legally abandoned.
On July 29, 2005, Mr. Bell filed another suit against Dr. Glaser, this one for breach of the sublease and to recover damages. Dr. Glaser filed an Exception of Prescription arguing that Mr. Bell's claims accrued greater than ten years earlier. The district court granted the exception of prescription, and this timely appeal followed.
Mr. Bell argues on appeal that the district court erred in sustaining Dr. Glaser's exception of prescription and dismissing his suit.
An appellate court cannot disturb the factual findings of the district court in the absence of "manifest error" or unless it is "clearly wrong." Stobart v. State, Through Dept. of Transp. & Dev., 617 So. 2d 880, 882 (La.1993). However when a trial court commits legal error, an appellate court is required to review the record de novo. Edwards v. Pierre, 08-0177 (La. App. 4 Cir. 9/17/08), 994 So. 2d 648, 656. Prescription is a purely factual determination. Thus, the standard of review on an exception to prescription is manifest error. Katz v. Allstate Ins. Co., XXXX-XXXX (La. App. 4 Cir. 2/2/05), 917 So. 2d 443; Parker v. B & K Const. Co., Inc., XXXX-XXXX (La. App. 4 Cir. 6/27/07), 962 So. 2d 484.
In his lone assignment of error, Mr. Bell alleges that the prescriptive period did not begin to run until August 1995, at the termination of the sublease and *517 when he permanently moved out of the building. He asserts that the ongoing physical damages and consequential economic damages caused by defects in the leased premises are within the ten year prescription period; therefore, the prescriptive period for any of the more recent damages has not run. He also asserts that the ongoing damages should be treated similarly to a continuing tort where prescription does not begin until the damage-causing conduct ends.
Prescription begins to run when it is determined that damage was sustained. Landry v. Blaise Inc., XXXX-XXXX, p. 4 (La.App. 4 Cir. 10/23/02), 829 So. 2d 661, 664. Damage is sustained for the purposes of prescription when it has manifested itself with sufficient certainty to support the accrual of a cause of action. Id., p. 5, 829 So.2d at 665; Hazelwood Farm Inc. v. Liberty Oil and Gas Corp., 2002-266 (La.App. 3 Cir. 4/2/03), 844 So. 2d 380, 389. Where a claimant has suffered some but not all damages, prescription runs from the day on which he suffered actual and appreciable damages even though he may thereafter realize more precise damages. Hazelwood, at 389; Harvey v. Dixie Graphics, Inc. (La.1/17/92), 593 So. 2d 351, 354. Thus, even where there are ongoing damages, prescription does not run from each incident of damages; rather, it runs from the day that actual and appreciable damages were noticed or suffered by the claimant.
Our review of the record indicates that Mr. Bell had first-hand knowledge of actual and appreciable damages as early as the fall 1994, and undoubtedly by May 1995. His letter to Dr. Glaser in May 1995, noting that the building was uninhabitable for the purpose for which it was leased along with the widespread damage from the flooding of the roof, provided notice of actual physical and appreciable damages. Prescription began to toll from May 1995. Since Mr. Bell did not file suit within the requisite prescription period of ten years, his cause of action prescribed. Therefore, we find that this assignment of error is without merit.
DECREE
For the foregoing reasons, the judgment of the district court granting the Exception of Prescription in favor of Dr. Charles Glaser is affirmed.
AFFIRMED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564301/ | 616 S.W.2d 630 (1981)
JIM WALTER HOMES, INC., Appellant,
v.
Joe Cruz CASTILLO, Appellee.
No. 1774.
Court of Civil Appeals of Texas, Corpus Christi.
February 12, 1981.
Rehearing Denied May 21, 1981.
*631 Danny Van Winkle, Vinson & Elkins, Houston, for appellant.
Mills Latham, Law Offices of Latham & Patterson, Corpus Christi, Hector Gonzalez, Law Offices of Hector Gonzalez, Sinton, for appellee.
OPINION
NYE, Chief Justice.
This is an appeal by Jim Walter Homes, Inc., appellant-defendant, from a judgment in favor of Joe Cruz Castillo, appellee-plaintiff, for violations of the Texas Deceptive Trade PracticesConsumer Protection Act, Tex.Bus. & Com. Code Ann. § 17.41 et seq. (Supp.1980) [hereinafter "DTPA"] and the Texas Consumer Credit Code, Tex.Rev.Civ. Stat.Ann. art. 5069-1.01 et seq. [hereinafter "Credit Code"]. Suit was originally *632 brought by plaintiff asserting a cause of action against defendant for alleged violations of the DTPA and Credit Code. The jury found violations under both, and the trial court entered its judgment in accordance with the jury's findings. Jim Walter Homes, Inc., appeals.
On February 8, 1974, plaintiff entered into a contract with a representative of defendant. The contract provided for defendant to construct a new house on plaintiffs' unencumbered property in Fort Bend County, Texas. The cash price of the house was $12,895.00, plus a finance charge of $14,015.00, for a total sale price of $26,810.00. To secure payment of the debt, defendant required plaintiffs to release a first lien on the house.
During construction of the house, plaintiffs noticed several problems in the manner of construction, but were told by defendant's representatives that the problems would be cured. Plaintiffs moved into the house during June or July 1974. Approximately nine months to a year after moving into the house, plaintiff began to notice construction defects such as floors cracking, doors not shutting properly, and warped drawers. Upon noticing these defects, plaintiff began to complain extensively to defendant, and subsequently filed this lawsuit on December 1, 1978. This date is four years and ten months after the original contract was signed, and four years and six months after plaintiff complained about the construction, and three years and six months after the defects began showing up in the house.
Causes of action under the Credit Code are controlled by Article 5069-8.04, Tex.Rev.Civ.Stat.Ann., which provides as follows:
"... Such actions may be brought within four years from the date of the loan or retail installment transaction or within two years from the date of the occurrence of the violation, whichever is later...."
Since this lawsuit was filed almost five years after the date of the loan or retail installment transaction, it does not fall within the permissible time limits provided for in the Credit Code. Plaintiff contends, however, that since defendant had retained a lien on the house, the violation was continuing and the suit was timely filed within two years from the date of the occurrence of the violation.
This same argument was confronted and rejected in Jim Walter Homes, Inc. v. Smith, 592 S.W.2d 670 (Tex.Civ.App. Beaumont 1979, writ ref'd n.r.e.). The Beaumont court was faced with a lawsuit filed under the Credit Code on July 19, 1978. The contract was entered into on July 17, 1973. The suit was certainly not filed within four years of the contract. The court was faced with the 1973 version of Article 5069-8.04, which said "or two years from the date of the final entry made thereon...." instead of "or within two years from the date of the occurrence of the violation...." They rejected the above argument and held that the continuing violation theory is unreasonable which would give the plaintiffs seventeen years to bring their lawsuit. The Credit Code cause of action was held barred.
If we were to agree with plaintiffs' contention that the "occurrence of the violation was continuing as long as the first lien remained on the property, we would find that this lawsuit could be maintainable from May, 1974, when the lien arose, until April, 1991, two years after the final payment was made. This result would be unreasonable, so the continuing violation theory cannot be accepted. Accordingly, we hold that the Credit Code cause of action is barred by limitations.
Next, we turn to the cause of action under the DTPA. The jury found that defendant, through his Mechanic's Lien Contract, represented that the house would be built in a good, substantial, and workmanlike manner. The jury further found that this representation was false and the plaintiff was adversely affected by such representation. The trial court entered judgment in accordance with the jury findings.
*633 Defendant argues that it was error for the trial court to enter judgment for violations under the DTPA, because any claim by plaintiff under this act was barred by the statute of limitations. As decided this same day by this Court in Jim Walter Homes v. Chapa, 614 S.W.2d 838 (Tex.Civ. App.Corpus Christi 1981), the four-year limitations in Article 5527, Tex.Rev.Civ. Stat.Ann. (1958) applies to this type of action. For a full discussion of this question, refer to the above-mentioned opinion.
In determining when the four-year limitation period begins to run, we must determine whether the "discovery rule" applies to this type of action. Both parties agree that the application of the discovery rule to a case under the DTPA is one of first impression; however, the rules governing when the statute of limitations begin are quite settled.
In fraud, the rule is set out in Quinn v. Press, 137 Tex. 60, 140 S.W.2d 438, 440 (1941) as follows:
"... the statute of limitations begins to run from the time the fraud is discovered, or could have been discovered by the defrauded party by the exercise of reasonable diligence."
See also Polk Terrace, Inc. v. Curtis, 422 S.W.2d 603 (Tex.Civ.App.Dallas 1967, writ ref'd n.r.e.).
In a case alleging a breach of implied warranty, the rule is set out in Richman v. Watel, 565 S.W.2d 101, 102 (Tex.Civ.App. Waco 1978, writ ref'd n.r.e.) as follows:
"Limitation (here the four year statute) commences on the breach of implied warranty when the buyer discovers or should discover the injury."
And the often quoted language of Atkins v. Crosland, 417 S.W.2d 150, 158 (Tex.Sup. 1967), sets out the following guidelines:
"The test to determine when the statute of limitations begins to run against an action sounding in tort is whether the act causing the damage does or does not of itself constitute a legal injury, that is, an injury giving rise to a cause of action because it is an invasion of some right of plaintiff. If the act is of itself not unlawful in this sense, and plaintiff sues to recover damages subsequently accruing from, and consequent on, the act, the cause of action accrues, and the statute begins to run, when, and only when, the damages are sustained and this is true although at the time the act is done it is apparent that injury will inevitably result."
In the case at bar, we must determine whether the act (here representations) was of itself unlawful or not. If the act was not unlawful, the cause of action accrues when the damages are sustained. Atkins v. Crosland, supra. Here the representation that the construction was to be in a good and workmanlike manner was not unlawful in and of itself. The statement only became unlawful when the damage occurred. Before plaintiff discovered that the house was not built in a good, substantial, and workmanlike manner, he had no cause of action; therefore, we hold that the discovery rule applies to the case at bar.
Our next key question is whether plaintiff Castillo discovered the defects during construction of the house, around June, 1974, or whether the defects were discovered when he noticed cracks in the floor, etc., in March of 1975. In the latter case, the cause of action would not be barred by the limitations.
In Polk Terrace, Inc. v. Curtis, 422 S.W.2d 603 (Tex.Civ.App.Dallas 1967, writ ref'd n.r.e.), the court found that the limitation had run on facts similar to those at bar. The facts showed that plaintiffs bought a house on June 1, 1959. Beginning in 1960, numerous defects were found in the house, such as cracking driveway, bricks pulling loose, etc. In the fall of 1965, plaintiff finally hired an expert to investigate, and suit was filed immediately thereafter. The lawsuit was for an oral representation made concerning the quality of the house's foundation. It was filed over five years after the first problems were noticed in the house. Plaintiffs, however, asserted that they did not discover the defect until they hired an expert to investigate the problems. *634 The Polk Terrace court disagreed, saying that the fraud "could have been discovered by the defrauded party by the exercise of reasonable diligence" more than two years before the lawsuit was filed. Therefore, the lawsuit was barred by the statute of limitations.
In the present case, the cracks and other defects in the house did not begin to appear until nine months to a year after the house was occupied. If the limitation period began at that time, then the DTPA action would not be barred. To begin the limitation period at the time when the defendant suggests would be to impose an unreasonable burden upon the plaintiff. At the time construction was going on, plaintiff, a non-expert in the construction business, would have had no way of determining whether such irregularities would ultimately produce defects in a completed house. Therefore, the time period for limitation begins to run when the damages actually began to show on the completed house. Since, in the present case, this period is undisputed to be within the four years allowed under the limitations of Article 5527, Tex.Rev.Civ.Stat.Ann., the cause of action under the DTPA for appellee was not barred.
Defendant next complains that the trial court failed to submit several additional elements such as materiality and reliance as an issue to the jury, even though such elements are not in the text of the DTPA. This point has been thoroughly discussed by this Court in Jim Walter Homes v. Chapa, 614 S.W.2d 838 (Tex.Civ.App.Corpus Christi 1981), handed down on this day. These points are overruled with reference to this companion case.
Appellant Jim Walter Homes also raises no-evidence and insufficient-evidence points. In deciding no-evidence points, we must consider only the evidence and the inferences tending to support the findings and disregard all evidence and inferences to the contrary. Garza v. Alviar, 395 S.W.2d 821 (Tex.Sup.1965). When deciding insufficient-evidence points, we must consider and weigh all the evidence, including any evidence contrary to the trial court's judgment. In Re King's Estate, 244 S.W.2d 660 (Tex.Sup.1951). See also, Burnett v. Motyka, 610 S.W.2d 735 (Tex.Sup.1980).
Plaintiff testified that defendant's salesman had come to his home in 1974. Plaintiff, after deciding on a house he could afford, signed a building contract. On this same date, February 8, 1974, plaintiff also signed a Mechanic's Lien Contract, giving defendant a first lien on the home. The contract provided that defendant would construct the home in a good, substantial, and workmanlike manner.
During the trial, plaintiff called George Clower, an architect, to testify as to whether the house was built in a good, substantial, workmanlike manner. Extensive testimony was given by Mr. Clower regarding defects and problems in the foundation, floor, doors, roof, plumbing, interior and exterior. Mr. Clower's testimony was rebutted by Engineering Professor Dr. Ned Burns.
It is the province of the jury to resolve any contradictions or inconsistencies in the testimony and to judge the credibility of the witnesses and the weight to be given their testimony. Johnson v. Buck, 540 S.W.2d 393 (Tex.Civ.App.Corpus Christi 1976 writ ref'd n.r.e.). This Court may not pass upon the credibility of witnesses or substitute its findings for those of the trier of fact. Burchfield v. Tanner, 178 S.W.2d 681 (Tex.Sup.1944). With the preceding rules in mind, we hold that there was sufficient evidence to sustain the jury's findings. Defendant's points of error regarding the sufficiency of the evidence are overruled.
Defendant also contends on appeal that the jury used the wrong measure of damages in arriving at its verdict. The issue submitted to the jury on damages used the remedial cost as the measure of damages. Defendant asserts that the correct measure to be submitted to the jury is the difference between the house as constructed and its value had it been constructed according to contract.
*635 The usual consideration in deciding which measure of damages to use is the economic feasibility of correcting the defects or bringing the house into compliance with the contract. Where the correction of defects and deviations would impair the entire structure or require the expenditure of sums in excess of the value of the structure, the correct measure of damages is the difference in the value of the structure as constructed and its value had it been constructed without defects or deviations. Hutson v. Chambless, 300 S.W.2d 943 (Tex.Sup.1957). Where the correction of defects and deviations would not impair the structure as a whole, the remedial cost is an appropriate measure of damages. Rogowicz v. Taylor and Gray, Inc., 498 S.W.2d 352 (Tex.Civ.App.Tyler 1973, writ ref'd n.r. e.); Drury v. Reeves, 539 S.W.2d 390 (Tex. Civ.App.Austin 1976, no writ).
Applying the general rule, plaintiff is entitled to the remedial cost or difference in value, whichever is less. Therefore, plaintiff had an election of which measure to plead and prove. He chose the remedial measure. If defendant was dissatisfied with the remedial cost measure of damages, he had the duty to show there was no difference in the value of the house as contracted for and as received, or that the difference was less than the remedial cost. Greene v. Bearden Enterprises, Inc., 598 S.W.2d 649 (Tex.Civ.App. Fort Worth 1980, writ ref'd n.r.e.). Defendant's measure of damages point of error is overruled. All of the remaining points of error have been considered and we find them without merit.
The judgment of the trial court on the Credit Code alleged violation is reversed and judgment is here rendered that plaintiffs take nothing because it is barred by the statute of limitations. That portion of the judgment based upon defendant's violations of the DTPA is affirmed in all respects. The costs of this appeal are assessed one-half to each party.
AFFIRMED IN PART and REVERSED AND RENDERED IN PART. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564300/ | 76 F.2d 645 (1935)
ROYAL BAKING POWDER CO.
v.
HESSEY and three other cases.
Nos. 3754-3757.
Circuit Court of Appeals, Fourth Circuit.
April 2, 1935.
*646 Carroll G. Walter, of New York City (Patterson, Eagle, Greenough & Day, of New York City, on the brief), for appellants in Nos. 3755 and 3756.
Herbert M. Brune, Jr., of Baltimore, Md. (Brown & Brune, of Baltimore, Md., and Davis, Polk, Wardwell, Gardiner & Reed, of New York City, on the brief), for appellant in No. 3754.
Neil P. Cullom, of New York City (J. Purdon Wright, of Baltimore, Md., Henry W. Steingarten, of New York City, and W. Frank Every, of Baltimore, Md., on the brief), for appellant in No. 3757.
Malcolm H. Lauchheimer, of Baltimore, Md. (Sylvan Hayes Lauchheimer, of Baltimore, Md., on the brief), for appellee.
Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.
SOPER, Circuit Judge.
These appeals are from orders of the District Court disallowing claims filed by appellants against the estate of L. Van Bokkelen, Inc., a Maryland corporation, which was adjudicated bankrupt upon its voluntary petition, filed March 13, 1931. The four claims involved were all debts in the first instance of the bankrupt's predecessors in business, and the presence of common questions renders it desirable to dispose of the cases in a single opinion.
The bankrupt corporation was engaged in the business of importing and exporting fruits, vegetables, and other kinds of merchandise between the United States and South America. Offices were maintained in New York City, Buenos Aires, and Montevideo. Prior to November 1, 1929, when the corporation acquired the business, it had been conducted in the first instance as the individual business of Libertus Van Bokkelen, a resident of Argentina, who was represented in New York by his brother, Walter Van Bokkelen. Libertus Van Bokkelen died February 9, 1929, and the business was carried on for a short time thereafter by his estate, under the name "Sucescion L. Van Bokkelen"; Walter Van *647 Bokkelen assuming the active management. On or about August 9th of the same year, the widow of Libertus, who had obtained the ownership of the business through assignment of the interest of certain other heirs and by virtue of an adjudication in the Argentine, transferred the entire business by bill of sale to Walter Van Bokkelen, for the stated consideration of 50,000 pesos, Argentine paper currency. It was he who sold it to the bankrupt corporation in November, 1929.
Libertus Van Bokkelen, during his life, had borrowed large sums of money for use in the business and had incurred other liabilities therein. Four items of this indebtedness are involved in the claims here: (1) Royal Baking Powder Company, one of the claimants, whose products Libertus Van Bokkelen sold in South America, loaned him $150,000 on January 18, 1929. This debt was evidenced by his demand note of that date, signed also by Walter Van Bokkelen as comaker. Subsequent credits for commissions reduced the total alleged indebtedness to $116,287.11, including interest to March 13, 1931, the date of adjudication in bankruptcy. (2) Previously, a loan of $125,000 had been made to Libertus Van Bokkelen by the trustees of a trust established in England, this debt being evidenced by a note to claimants Kennerly-Hall and Stirling, the surviving trustees. The note was indorsed by Walter Van Bokkelen, against whom judgment was secured May 6, 1930. (3) The claim of National Cold Storage Company, which amounts to $16,726.99, with interest, is based upon charges to the account of Libertus Van Bokkelen for storage and handling of merchandise at various times. (4) The claim of Grace E. Lowendahl likewise arises out of a loan to Libertus Van Bokkelen, made by her assignor and evidenced by a note upon which Walter Van Bokkelen was bound as indorser. A judgment in the amount of $222,594.12 against the bankrupt corporation was obtained by the claimant under circumstances later to be detailed, and she founds her claim principally thereon. The trustee, though admitting the liability of Libertus and Walter Van Bokkelen for these debts, resists proof of the claims on the ground that they do not represent debts of the bankrupt.
The claimants seek to establish the liability of the bankrupt corporation for these debts upon certain common grounds that rest upon the circumstances under which Walter Van Bokkelen transferred to the corporation the business he had acquired. The first of these contentions is that irrespective of any fraud, the bankrupt became liable for the debts of Libertus to the extent of the assets which it purchased and received. It is pointed out that in Strongin v. International Acc. Bank, 70 F.(2d) 248 (C. C. A. 2), it was held that the assets in question belonged to the estate of Libertus and did not belong to Walter. But it is quite clear that the court there had before it much evidence which is not in the present record although that decision was rendered before the decision of the District Court in the pending case. We must confine ourselves to the showing here that on August 9, 1929, the widow of Libertus sold the business to Walter. She had previously acquired the interests therein of Libertus' parents, and it had been adjudicated in the proceedings of the estate probated before the Court of First Instance in Civil Causes in the City of Argentina, that the business belonged to her with the right to dispose of it.
The claimants say that it is immaterial whether Walter or the estate was the owner of the assets when they were transferred to the bankrupt corporation, because in either event, they had previously belonged to the estate, and were liable for the debts thereof, and it does not matter whether the bankrupt bought them from the heirs or distributees of the estate, or from one who had himself bought them from the heirs or distributees. The point urged is that the bankrupt could get no better title than the vendor of the assets, who had acquired them subject to the rule that the assets of a decedent are primarily liable for his debts; and reference is made to such cases as Borer v. Chapman, 119 U.S. 587, 7 S. Ct. 342, 30 L. Ed. 532, and McClellan v. Carland (C. C. A.) 187 F. 915, and the general rules set out in 18 C. J. 897, 898 and 953. These propositions cannot be denied, but they have no application to the facts before us. We are not dealing with property acquired from an executor de son tort, and from one who was merely the distributee of an estate, but from one whose ownership of the property had been adjudicated. In the absence of further proof, we are not at liberty to question the validity of that holding.
The second contention is that the agreement of sale from Walter to the corporation, executed by the parties in New York *648 on November 1, 1929, was fraudulent under the Debtor and Creditor Law of New York, §§ 271, 272 and 273 (Consol. Laws N. Y. c. 12), which provide in substance that every conveyance is fraudulent as to creditors, without regard to actual intent, when made by a person who is or will be thereby rendered insolvent, if the conveyance is made without a fair consideration. The facts are discussed at length in an effort to show that the District Judge was wrong in his finding (see 7 F. Supp. 639, 645) that Walter was solvent on November 1, 1929. The point is not without difficulty for the facts are intricate, and an estimate of values necessarily conjectural when made a long time after the crucial date, which occurred shortly after the beginning of an extraordinary collapse of business in this country. In our opinion, it is not essential to make a finding on the point, and we shall assume, for the purpose of the argument, that Walter was then insolvent. It is necessary, however, for the claimants to go a step further under the statute and to show that the bankrupt corporation did not pay a fair amount for the property which it received. The amount paid was $275,998.07, of which $124,000 was paid for 51 per cent. of the stock of a subsidiary corporation, Van Bokkelen & Rohr, Inc., and $151,998.07 for the goods on hand. It is not suggested that $151,998.07 was not a fair amount for these goods, since they were taken at inventory cost, but it is said that $124,000 was inadequate for the stock of the subsidiary corporation because this sum was arrived at by excluding the good will, trade-marks, and trade-names in determining the liquidated value of the total capital stock. In answer to this it is sufficient to say that there is nothing in the record to show that any other person would have given any more for the assets transferred. The active head of the business, who had owned the majority of the stock, was dead. The time of the purchase was November 1, 1929, immediately after the slump in the market had begun. The business was in need of financing, and it was considered a stroke of good fortune when the Baltimore & Ohio Railroad was found willing to invest $500,000. We cannot take seriously the fanciful valuation of $3,000,000 placed by the incorporators on 30,000 shares of capital stock now said to represent the good will of an insolvent concern. The stock was issued as a bonus, 51 per cent. to the Baltimore & Ohio Railroad interests, and 49 per cent. to Walter. It was subject to $500,000 of preferred stock, and gave the active manager a share of the future profits if any should be earned. As it turned out, there were no profits.
A third argument is that the transfer was fraudulent in law irrespective of insolvency or the fairness of consideration, because it hindered and delayed the creditors of the transferor; and reliance is had upon decisions invalidating transfers because the parties to the transactions, although innocent of fraudulent intent, must have known that their creditors would be hindered and delayed thereby; as in Means v. Dowd, 128 U.S. 273, 281, 9 S. Ct. 65, 32 L. Ed. 429, where there was an assignment to trustees for the benefit of creditors, or Shapiro v. Wilgus, 287 U.S. 348, 53 S. Ct. 142, 77 L. Ed. 355, 85 A. L. R. 128, where there was a transfer to a corporation so that a receiver might be appointed for the corporation; or First National Bank v. Flershem, 290 U.S. 504, 54 S. Ct. 298, 78 L. Ed. 465, 90 A. L. R. 391, where the corporation secured a judicial sale of its assets under a plan of reorganization. These cases are not applicable here, for it does not appear that there was concert of action of the persons interested in the bankrupt corporation to hinder and delay the creditors by means of the sale. The Baltimore & Ohio Railroad had no motive to hinder or delay the creditors, having no obligation to them; and it is not reasonable to suppose that it knowingly jeopardized its investment by putting it into a corporation in such a way as would be merely helpful to Walter and prejudicial to itself. The fair value of the assets, in the form of money, was paid into the hands of the owner, and the money was actually used in paying certain of the creditors. There is no evidence that the railroad or corporation had anything to do with the making of preferential payments rather than a pro rata distribution.
It is finally contended on this branch of the case that the transfer to the bankrupt corporation was void as to the complaining creditors because of the failure of the parties to the transfer to comply with the New York Bulk Sales Act, section 44 of the New York Personal Property Law (Consol. Laws N. Y. c. 41), which provides in substance that the parties to a transfer in bulk of any part or the whole of any stock of merchandise pertaining to the business of the seller, otherwise than in the ordinary course of trade, shall make an *649 inventory of the quantity and price of each article at least five days before the sale; and unless the purchaser shall at least five days before taking possession thereof or paying therefor, notify every creditor of the seller on a complete list to be furnished by the latter of his creditors and indebtedness; and further providing that any purchaser who fails to conform to the act, shall upon application of any of the creditors be held accountable to them for all the merchandise so purchased. The District Judge held that this statute was inapplicable to the transfer and that the passage of title was governed by the law or situs of the assets in Buenos Aires where the assets were situated.
We agree with this finding. It is contended that it is in conflict with the general rule that the law of the place of contracting determines the validity and effect of a contract. The holding of the District Court, however, does not violate this rule. The question is really one of conflict of laws, whether, when a contract of sale is made in one place, and the articles transferred are in another jurisdiction, the law of the former or the latter should be applied with reference to the claims of creditors. The Final Draft of Restatement of Conflict of Laws, §§ 255 and 256, are applicable. They provide in substance that the formalities necessary for the validity of a conveyance of a chattel, and whether it is made by a party who has capacity to convey, is determined by the law of the state where the chattel is at the time of the conveyance; and it is pointed out in comment b of section 256 that the validity of a conveyance as to third parties, as, for instance, when it is alleged to be in fraud of creditors, is to be determined by the law of the state where the chattel is situated. If the rule were otherwise, purchasers at the place where the merchandise is situated would be charged with knowledge of the laws of a foreign jurisdiction.
The validity of the claim of Grace E. Lowendahl is pressed on grounds that are nowise related to the other claims considered in this opinion. The basis of the claim is that the claimant instituted an action in the Supreme Court of New York County on May 4, 1930, to set aside as fraudulent the conveyance by Walter Van Bokkelen to the bankrupt corporation, alleging that she was an assignee of a creditor of Libertus Van Bokkelen. The action was tried on February 18, 19 and 20, 1931, and on March 10, 1931, the presiding judge sent to the clerk of the court his proposed findings of fact and conclusions of law and his opinion. These papers, however, did not constitute the decision of the court, but served as the basis of the decision to be subsequently rendered in accordance with section 439 of the Civil Practice Act of New York, Hydraulic Power Co. v. Pettebone-Cataract Paper Co., 194 A.D. 819, 186 N. Y. S. 1. On the following day, the claimant's attorneys prepared a decision and decree and served them on the opposite side. On March 12, the attorney for the bankrupt conferred with an officer of the Baltimore & Ohio Railroad Company, one of the creditors of the bankrupt, and also the holder of a large part of its stock through a subsidiary corporation, and it was determined that the bankrupt should file a voluntary petition in bankruptcy in the District Court of the United States for the District of Maryland, and this was done on March 13, 1931. The filing of a voluntary petition in bankruptcy was approved at a meeting of the board of directors held in Baltimore on March 13, 1931. Prior thereto, on March 12, 1931, certain of the other claimants interested in this case, to wit, Royal Baking Powder Company, National Cold Storage Company, and Kennerly-Hall, filed a petition of intervention in the New York case, and secured a stay restraining the trial justice from signing the decree and decision; and on March 16, counsel for the parties appeared before the trial justice who denied the motion to intervene and vacated the stay. The trial justice in New York was of the opinion under these circumstances that there was collusion in the filing of the petition in bankruptcy, and on April 1, he ordered that his decision and judgment be amended nunc pro tunc so that the date thereof should be March 12, 1931, and have the same force and effect as if it had been entered and filed on that date.
With respect to this claim, we are in accord with the conclusions stated by the District Court in its opinion, namely, that the claim was not provable as a "fixed liability, as evidenced by a judgment * * * absolutely owing" at the time of the filing of the petition in bankruptcy, in accordance with the provisions of section 63a (1) of the Bankruptcy Act, 11 USCA § 103 (a) (1), and that the nunc pro tunc judgment of the New York court was not provable as a "fixed liability, as evidenced *650 by * * * an instrument in writing, absolutely owing at the time of the filing of the petition" in bankruptcy, pursuant to the provisions of that section, and further, that there was no such fraud upon the bankruptcy court or collusion by the bankrupt and others, as would justify the allowance of the claim or the vacating and setting aside of the adjudication in bankruptcy.
The claim of the Royal Baking Powder Company rests on circumstances which it claims furnish additional grounds for the allowance of its claim against the bankrupt corporation. Libertus Van Bokkelen had acted as South American agent for Royal, and on January 18, 1929, had borrowed $150,000 for which he and Walter Van Bokkelen executed their joint note. There was an accompanying agreement which provided that the commissions earned by the agent should be credited on the note, and that Libertus would incorporate his business within a year and have the corporation issue its note for the balance then due. A month later, Libertus died, and then followed the management of the business by Walter Van Bokkelen, and finally his purchase thereof on August 9, 1929, and the subsequent formation of the present bankrupt corporation and the acquisition of a portion of the assets by it, Walter becoming the president. As we have seen, the corporation did not assume the liabilities of the old business and it did not derive any benefit from the loan which Royal had made to the preceding owner. Nevertheless it is claimed that the corporation is liable on the note because of the following circumstances: During the period between the death of Libertus and the formation of the bankrupt corporation, the agency continued and commissions were credited on the note against the loan as the agreement contemplated. Royal was not notified of the details of the transactions by which the Baltimore & Ohio Railroad became interested in the new corporation, but did have a conversation with Walter in November, 1929. The parties are in conflict as to what took place at this interview, but assuming the correctness of the statement made by witnesses for the claimant, its representatives were told that Walter had been successful in interesting the Baltimore & Ohio Railroad to provide the necessary financing for the corporation; that the indebtedness to Royal would be taken care of shortly; and that in the meantime, it was to continue to credit commissions against the note. On December 3, 1929, the Royal received a letter from the treasurer of the new corporation containing the information that a Maryland corporation had been organized which had acquired the business of L. Van Bokkelen, and had outstanding $500,000 of preferred stock, acquired by New York banking interests, and 30,000 shares no par common stock issued in consideration for the business of L. Van Bokkelen, and that Walter Van Bokkelen was president of the company; that the former business was being transferred and taken over by the new company, and as soon as this was accomplished, a complete accounting statement would be furnished.
The contention is that through this form letter, Royal was led to accept the representations of Walter and to infer that this corporation was the one contemplated by the agreement accompanying the note, and would be liable for the amount of the note; and it is said, therefore, that the bankrupt cannot now deny either that it was a mere incorporation of the old business, or that Walter was authorized to make the representation on which the claimants rely. It is suggested that Royal was justified in supposing that all of the common stock of the company had been transferred to Walter and that he was not only the president but virtually the owner of the company.
We do not think that the statements in the letter justify these inferences. It was made clear that persons, who were in no way parties to the original agency agreement or to the note, had become interested in the business and had advanced a substantial sum of money to finance the new corporation, and the mere fact that the new corporation had acquired the old business did not justify or require the inference that the old liabilities were assumed. Nor was there any justification for the inference that all of the common stock of the company had been transferred to Walter Van Bokkelen. The mere fact that a substantial investment had been made by new parties would have suggested the inquiry as to what interest or control they acquired in the new corporation and what liability it assumed for the debts of the old business. Moreover, it is not without significance that the new corporation did not sign a note for the indebtedness to Royal; nor did Royal suggest that this be done in order to carry out the terms of its agreement with Libertus.
It may well be that Royal was misled by the statement of Walter that the note *651 would be taken care of, and by his action in permitting the commissions to be credited upon the note without complaint, until he repudiated the transaction as a liability of the corporation in April, 1930. We think, however, that under the circumstances related, Royal was not justified, without inquiry, in its assumption that the new corporation, which was not a joint maker of the note or of the accompanying agreement, assumed the liability therefor. While the new corporation held out Walter Van Bokkelen as its president, and was responsible for such statements and actions as he made in that capacity in the usual course of business, the transaction under consideration was one out of the ordinary run, for if undertaken as Royal understood, it amounted to the assumption by the bankrupt corporation of a liability for which it received no consideration. The same principle was applied by this court in Drovers' & Mechanics' Nat. Bank v. First Natl. Bank, 260 F. 9, where it was held that a bank was not responsible for a debt incurred by its vice president previous to its formation, and was not estopped by his representations that the bank had assumed the debt, since his authority was merely to act as vice president in the usual course of business, and the circumstances were such as put the holder of the note on inquiry.
Finally, it is contended that the bankrupt is liable to Royal to the amount of its claim on the ground merely that it had taken over the business of Libertus, and had issued all of its common stock therefor. This proposition rests on certain cases which hold in substance that when a new corporation, which is substantially identical with the previous owners of the business, and merely a continuation of the old business, takes over its assets, a liability arises to pay its debts, as for instance, where a corporation composed of the same persons as a previous copartnership is formed for the purpose of carrying on the same business, issuing its stock to the members of the copartnership, as in DuVivier & Co. v. Gallice (C. C. A.) 149 F. 118, or where the transfer to the new corporation is made in the form of a lease, as in Reed Bros. Co. v. First Natl. Bank, 46 Neb. 168, 64 N.W. 701, or Helvering v. Wheeling Mold & Foundry Co. (C. C. A.) 71 F.(2d) 749, where the transferor, as a part of the transaction, stripped itself of its assets by making distribution to its stockholders without making provision for its creditors, both parties to the transaction being fully cognizant of all the circumstances. These cases, however, have no substantial similarity to the case at bar, for although the bankrupt corporation was organized to carry on the former business, there was a substantial change in the situation in that new capital was invested by new parties, a part only of the assets was acquired, and the transferor expressly agreed to be responsible for the outstanding obligations. We do not think that the cases cited are authority for holding, under the circumstances of the pending case, that the transferee corporation was responsible for the debts of its predecessor.
Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564318/ | 16 So. 3d 1009 (2009)
CLAURO ENTERPRISES, INC., and Ricardo Rupcich, Appellants,
v.
ARAGON GALIANO HOLDINGS, LLC, Appellee.
No. 3D09-711.
District Court of Appeal of Florida, Third District.
September 2, 2009.
*1010 Alan P. Dagen, for appellants.
Seidman, Prewitt, DiBello & Lopez and Clayton D. Hackney, Coral Gables, for appellee.
Before GERSTEN, ROTHENBERG, and LAGOA, JJ.
*1011 LAGOA, Judge.
Clauro Enterprises, Inc., ("Clauro") and Ricardo Rupcich ("Rupcich") appeal an order denying their motion to vacate a final default judgment for lack of jurisdiction entered in favor of Aragon Galiano Holdings, LLC ("Aragon"). Clauro and Rupcich challenge the entry of the respective default judgments on the ground that service of process was defective. We affirm as to Clauro. However, we reverse as to Rupcich because we agree that service on him, individually, was defective.
I. FACTUAL AND PROCEDURAL HISTORY
In February 2008, Aragon filed a multi-count complaint against Clauro and Rupcich, individually, for breach of contract, conversion, civil theft, and unjust enrichment. Pursuant to section 48.031(6), Florida Statutes (2008), Aragon attempted service on both Clauro and Rupcich by leaving copies of the complaint and summons with the owner of a UPS mailbox store located in Weston, Florida. Neither defendant filed or served a responsive pleading, and in April 2008, the trial court entered a final default judgment against both defendants, and awarded damages to Aragon.
Following the entry of the final default judgment, Aragon sought discovery in aid of execution on the judgment. The defendants failed to respond to the discovery requests, and Aragon filed a motion to compel. At the hearing on that motion, the trial court entered an order compelling the defendants to respond to the discovery in aid of execution or be deemed in contempt of court. A copy of the order was mailed to each defendant at the private mailbox located at the Weston UPS store. When the defendants failed to comply with the order, Aragon filed a motion for a rule to show cause why the defendants should not be held in contempt and for a writ of bodily attachment. Aragon served Rupcich with this motion at his residence in Weston, Florida.
In response, the defendants filed a motion to vacate the default judgment for lack of jurisdiction, arguing that neither had been served in compliance with section 48.031(6). In support of their motion, the defendants filed the affidavit of Rupcich, who asserted that he did not maintain a personal mailbox at the Weston UPS store and that his home address was easily ascertainable through the public records. The trial court denied the motion to vacate, and this appeal ensued.
II. ANALYSIS
On appeal, Clauro and Rupcich argue that Aragon failed to effect proper service necessary for the trial court to obtain personal jurisdiction over either defendant. We find that the trial court did not abuse its discretion in denying the motion to vacate as to Clauro, and we affirm that portion of the order without further comment. We agree, however, that Aragon failed to comply with section 48.031(6), Florida's substitute service statute, when it attempted to serve Rupcich, individually.
Substitute service statutes are an exception to the rule requiring personal service, and it is well-settled that such statutes must be strictly construed in order to protect a defendant's due process rights. See Alvarado v. Cisneros, 919 So. 2d 585, 588-89 (Fla. 3d DCA 2006); Torres v. Arnco Constr., Inc., 867 So. 2d 583, 586 (Fla. 5th DCA 2004); Fed. Nat'l Mortgage Ass'n v. Fandino, 751 So. 2d 752, 753 (Fla. 3d DCA 2000), and cases cited therein.
Section 48.031(6), states as follows:
If the only address for a person to be served, which is discoverable through *1012 public records, is a private mailbox, substitute service may be made by leaving a copy of the process with the person in charge of the private mailbox, but only if the process server determines that the person to be served maintains a mailbox at that location.
(Emphasis added). In determining whether service is proper under this statute, the court must consider the plain language of the statute. See Beckley v. Best Restorations, Inc., 13 So. 3d 125 (Fla. 4th DCA 2009). The statute only permits substitute service at a private mailbox if (1) it is the only address discoverable through the public records, and (2) the process server determines that the person to be served maintains a mailbox at that location. See Beckley, 13 So.3d at 125; Kramer v. MRT, LLC, No. 07-80931-CIV, 2008 WL 877211, at *1 (S.D.Fla. Apr. 1, 2008). Both requirements must be met. Here, Aragon has not met either.
With regard to the first requirement, Aragon did not and could not meet its burden of establishing that the only address for Rupcich discoverable through the public records was a private mailbox. Rupcich's affidavit clearly demonstrated that a review of the public records showed that since the year 2000 he has owned property in Weston, Florida for which he claims a homestead exemption. Moreover, at oral argument this Court noted that a search of the Broward County Property Appraiser's official website (http://www. bcpa.net) easily revealed the Weston home address for Rupcich. Finally, Aragon successfully served Rupcich at the Weston home address with its motion for rule to show cause and for writ of bodily attachment definitive evidence that the private mailbox was not the only address for Rupcich discoverable through the public records.
Aragon's failure to meet the first statutory requirement would be sufficient for us to reverse the default judgment against Rupcich, individually. Nonetheless, we also conclude that Aragon failed to meet the second statutory requirement because it failed to show that the process server determined that Rupcich maintained a mailbox at the Weston UPS store. In support of its position that service was proper, Aragon points to the return of service. That return of service, however, merely recites that service was in accordance with section 48.031(6), but it does not demonstrate that Aragon met either statutory requirement. "An affidavit [of service] which merely alleges that the service of process statute has been complied with is insufficient to meet the proponent's initial burden of establishing proper service." York Commc'ns, Inc. v. Furst Group, Inc., 724 So. 2d 678, 679 (Fla. 4th DCA 1999). See Johnston v. Halliday, 516 So. 2d 84, 85 (Fla. 3d DCA 1987) (holding that a return of service merely stating that substituted service was effected on the defendant's son who was "of suitable age and discretion" was insufficient absent facts establishing that the process server complied with specific requirements for substituted service).
Despite Aragon's assertion to the contrary, the return of service does not indicate that the process server spoke with the owner or an employee in charge of the UPS store to determine that Rupcich actually maintained a mailbox at that store. In addition, Aragon did not introduce any evidence that the process server made such a determination in any other manner. In contrast, Rupcich's affidavit denied that he maintained a private mailbox at the UPS store. Accordingly, no evidence exists to conclude that the process server determined that Rupcich maintained a mailbox at the Weston UPS store. See Kramer, 2008 WL 877211, at *1.
*1013 Because Aragon failed to show that it met either statutory requirement for substitute service on Rupcich, individually, we find that service under section 48.031(6) was invalid as to Rupcich, individually. See Beckley, 13 So.3d at 125; Kramer, 2008 WL 877211, at *1. "It is well-settled that `[a] judgment entered without valid service is void for lack of personal jurisdiction and may be collaterally attacked at any time.'" Alvarado, 919 So.2d at 587 (quoting Great Am. Ins. Co. v. Bevis, 652 So. 2d 382, 383 (Fla. 2d DCA 1995)); see Falkner v. Amerifirst Fed. Savs. & Loan Ass'n, 489 So. 2d 758, 759 (Fla. 3d DCA 1986) ("A judgment entered without due service of process is void."). Because Aragon failed to comply with section 48.031(6), the trial court did not have personal jurisdiction over Rupcich, and the default judgment is void. See Weiss v. Mashantucket Pequot Gaming Enter., 935 So. 2d 69 (Fla. 3d DCA 2006); Fandino, 751 So.2d at 753-54; Alvarez v. State Farm Mut. Auto Ins. Co., 635 So. 2d 131 (Fla. 3d DCA 1994). Accordingly, we reverse and remand with instructions that the default judgment entered against Rupcich be vacated forthwith.
Affirmed in part, reversed in part, and cause remanded for proceedings consistent with this opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564326/ | 76 F.2d 626 (1935)
MARYLAND CASUALTY CO.
v.
UNITED STATES.
No. 7602.
Circuit Court of Appeals, Fifth Circuit.
March 23, 1935.
H. Reid De Jarnett, of Miami, Fla., for appellant.
Frank J. Wideman, Asst. Atty. Gen., John MacC. Hudson, Sp. Asst. to Atty. Gen.; John W. Holland, U. S. Atty., and Raymond F. Brown, Sp. Asst. to U. S. Atty., both of Jacksonville, Fla., and Rene A. Viosca, U. S. Atty., of New Orleans, La.
Before BRYAN, SIBLEY, and HUTCHESON, Circuit Judges.
SIBLEY, Circuit Judge.
The United States in a common-law action sued Maryland Casualty Company as surety on a bond for $4,000 conditioned for the payment of income taxes due by Robert C. Lindsay. A plea of res judicata was stricken and judgment entered for a principal sum of $5,689.51, being the taxes with interest at 1 per cent. per month since they were first demanded of the taxpayer in September, 1926, with interest from date of judgment at 8 per cent. The appeal assigns error in striking the plea and in entering judgment for more than the penalty of the bond. The facts set up by the declaration and not denied by the plea are that Lindsay owed $2,707.85 as income taxes for the year 1925, and $300.44 as additional taxes for the year 1920, payment of which was demanded by the Commissioner in September, 1926; that in consideration of delay to enforce these taxes until May 26, 1928, or to place a lien on Lindsay's property until abatement of the tax should be decided, Lindsay on May 26, 1927, gave the bond sued on with Maryland Casualty Company as surety; that a claim for abatement of the 1925 tax was filed and the tax reduced by $85.65 on May 23, 1928; that on June 1, 1928, Lindsay was notified of this result but did not pay, and on January 30, 1929, Maryland Casualty Company was notified of Lindsay's default and payment demanded from it; and that on May 15, 1928, Lindsay had been adjudicated a bankrupt. The plea set up that in the bankruptcy case the collector of internal revenue filed a claim for these taxes, and on objection by the trustee the referee on January 28, 1929, disallowed the 1925 taxes and allowed only those for 1920. No review being had, the referee's ruling is pleaded as conclusively showing that Lindsay did not owe the 1925 taxes.
Assuming, without deciding, that the referee's decision would bind the United States otherwise than in the distribution of the bankrupt's estate, it was no answer to a *627 suit on this bond. The bond recites that there are due from Lindsay "certain additional income or profits taxes resulting from a deficiency in tax, and to exact payment of the deficiency in tax at this time will result in undue hardship," and it refers to a statutory authority in such cases to extend the time of payment on giving bond, and states that the Internal Revenue Department will "refrain from placing a lien on Lindsay's property until the matter in abatement shall be decided." The bond is to pay $4,000 on this condition, "If the principal shall on or before the 26th day of May, 1928, pay such deficiency in tax found to be due by the Commissioner plus penalty and interest, in accordance with the terms of the extension as herein stated, and shall otherwise well and truly perform and observe all the provisions of law and the regulations" the obligation is to be void. The bond appears to be on a form appropriate to the delay of deficiency assessments under section 274 (g) of the Revenue Act of 1924, and section 274 (k) of the Revenue Act of 1926 (26 USCA § 1054 and note). But a blank in the bond as to the statute referred to as authority stands unfilled, and it is argued that the tax for 1925 was not a technical deficiency assessment such as is referred to in the cited statutes. Possibly the recital in the bond that the taxes due are deficiencies is an estoppel. But if the bond be not one under the statute, it is good as a common-law obligation against its signers, who had the full benefit of it and who need no statute to enable them to contract. We have only to construe it. Lindsay stood faced by assessments securable by recording a lien and enforceable at once by distress, he not having sought relief through the Board of Tax Appeals. He had under the law to pay, though he might after paying seek refund of anything he did not owe. See Graham v. Du Pont, 262 U.S. 234, 43 S. Ct. 567, 67 L. Ed. 965. The bond means that the Internal Revenue Department will refrain from recording a lien against Lindsay's property till a claim in abatement to be made by him is decided and will defer collection until May 26, 1928, when Lindsay is to pay all unabated taxes with penalty and interest; and if he fails to do so the $4,000 promised by the bond is to be paid, or so much of it as equals the amount due by the taxpayer. The bond says that Lindsay is to pay not such taxes as he may legally owe, but "such deficiency in the tax found due by the Commissioner." The object of the bond was to assure prompt payment on May 26, 1928, of the taxes claimed by the Commissioner; not then to start a lawsuit about them. It has often been held that such a bond made to get time to pay an assessed tax, whether or not it is strictly authorized by statute, must be paid according to its terms after the delay has been enjoyed. United States v. John Barth Co., 279 U.S. 370, 49 S. Ct. 366, 73 L. Ed. 743; Gulf States Steel Co. v. United States, 287 U.S. 32, 53 S. Ct. 69, 77 L. Ed. 150; Gray Motor Co. v. United States (C. C. A.) 16 70 F.(2d) 367; Bowers, Collector v. American Surety Co. (C. C. A.) 30 F.(2d) 244; United States v. Wyoming Central Ass'n (C. C. A.) 70 F.(2d) 869. According to these cases, the present suit is not one to collect taxes, but to enforce the covenant of the bond. Whether after paying the bond the surety may be so subrogated to the taxpayer's rights as to be entitled to ask refund of any unlawful exaction is not a question before us.
Judgment should have gone against the surety, but not for the taxes with 1 per cent. per month interest to the date of judgment, nor for a principal amount in excess of the penalty of the bond. The suit is technically not one for taxes. The surety has not promised to pay them, but to pay $4,000 if Lindsay did not on May 26, 1928, pay his taxes. The penalty in a bond like this is no longer a forfeited "pound of flesh," but the law follows equity in treating it as a security for the performance of the condition and will exact only enough of it to recompense the obligee for the breach of the condition. If that recompense exceeds the fixed penalty the obligee cannot recover the excess against the surety. Whether, when the whole penalty is exhausted, it may itself bear interest has been differently decided. But the rule established by the Supreme Court is that "Sureties, if answerable at all for interest beyond the amount of the penalty of the bond given by their principal, can only be held for such an amount as accrued from their own default in unjustly withholding payment after being notified of the default of the principal." United States v. U. S. Fidelity & Guaranty Co., 236 U.S. 512, 513, 35 S. Ct. 298, 304, 59 L. Ed. 696. See, also, McGill v. Bank of United States, 12 Wheat. 511, 6 L. Ed. 711; Farrar v. United States, 5 Pet. 373, 8 L. Ed. 159; United States v. Hills, Fed. Cas. No. 15,369; United States v. Meeker, Fed. Cas. No. 15,757. Compare Illinois Surety Co. v. John Davis Co., 244 U.S. 376, 377, *628 37 S. Ct. 614, 61 L. Ed. 1206. So soon as Lindsay on May 26, 1928, failed to pay the taxes and interest claimed by the Commissioner, the bond was forfeited and demand might have been made under it for the amount thus due not exceeding the penalty. Thereafter, this demand under the bond bore interest at the legal rate, till the amount of the penalty was reached, but no interest in excess of the penalty can be claimed against the surety until after the notice to it on January 30, 1929, and then only at the legal rate instead of the tax rate. The judgment is reversed and the cause remanded, with direction to enter judgment accordingly. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564357/ | 16 So. 3d 190 (2009)
Philip Jerome ALEONG, D.V.M., Appellant,
v.
STATE of Florida, DEPARTMENT OF BUSINESS AND PROFESSIONAL REGULATION, Appellee.
No. 4D08-1624.
District Court of Appeal of Florida, Fourth District.
August 5, 2009.
Rehearing Denied September 15, 2009.
*191 Bradford J. Beilly and John Strohsahl of Bradford J. Beilly, P.A., Fort Lauderdale, for appellant.
Patricia Nelson, Tallahassee, for appellee.
POLEN, J.
Appellant, Philip Jerome Aleong, D.V.M., appeals the State of Florida Board of Veterinary Medicine's amended final order imposing heightened sanctions. This court has jurisdiction. Fla. R.App. P. 9.030(b)(1)(C)(2008); § 120.68, Fla. Stat. (2003).
On November 1, 2005, Appellee, the Department of Business and Professional Regulation (DBPR), filed an administrative complaint against equine veterinarian Dr. Philip Jerome Aleong. The complaint alleged that Aleong treated the horse "Slice and Dice" for a leg abscess on August 28, 29, 30, and 31, 2003, and that the medical records concerning such treatment were incomplete. Specifically, the complaint alleged the records (1) lacked a clinical assessment prior to beginning treatment; (2) failed to document the doctor's findings and clinical assessment of the horse; (3) failed to provide examination findings and progress assessments; and (4) failed to provide progress assessment or physical examination findings concerning the horse after treatment was completed. According to the complaint, such deficiencies were a violation of Florida Administrative Code Rules and subjected Aleong to disciplinary action under section 474.214(1)(ee), Florida Statutes (2000), for "[f]ailing to keep contemporaneous written medical records as required by the rules of the board." Fla. Admin. Code Ann. R. 61G18-18.002(3), 61G18-18.002(4) (2004).
The Board determined that Aleong was not entitled to a hearing due to his failure to file an Election of Rights form within twenty-one (21) days of his receipt of the *192 DBPR's complaint as required by Florida Administrative Code Rule 28-106.111 (2004). Accordingly, the Board adopted the allegations made in the complaint. As sanctions, the Board fined Aleong $3,000, suspended his veterinary license for thirty days, ordered him to take and pass the Florida Laws and Rules Examination for Veterinarians, ordered him to take five hours of continuing education, and ordered him to pay costs. Aleong appealed to this court.
This court upheld the Board's determination that Aleong had waived his right to a hearing because he failed to comply with the 21-day filing requirement found in Florida Administrative Code Rule 28-106.111, and held that requirement had not been tolled by either excusable neglect or equitable tolling. Aleong v. Dep't of Bus. and Prof. Reg., 963 So. 2d 799, 801 (Fla. 4th DCA 2007). We reversed the Board's initial final order because it imposed sanctions which exceeded those allowed for in the applicable statute without providing written findings justifying the departure. This court remanded the case to the Board and ordered it to "either impose a penalty within the guidelines or to make written findings which support the imposition of a harsher penalty." Id. at 802.
In response to this court's opinion, the DBPR filed a motion to amend the final order, and the Board held a hearing. During the hearing, counsel for Aleong argued to the Board that it had two options given the procedural history: (1) impose the normal fine and penalty, or (2) determine based on the previous record whether there was basis for an exacerbated penalty and make the requisite findings. One board member stated that he had reviewed the notes from the previous hearing and felt that the original increased penalty should be maintained because there were sufficient aggravating factors and the standard penalties were not enough. The Board agreed and two weeks later entered an amended final order in which it made the following findings of fact:
1. Aleong had two prior actions against his license in 2001 and 2003.
2. One of the prior violations was for the same issue as the present case: failing to keep accurate medical records as required by section 474.214(1)(ee), Fla. Stat., and Rule 61G18-18.002, Fla. Admin. Code.
3. Aleong had admitted on the record that he had failed to timely comply with the Final Order in a case which had come before the Board six months prior to the instant case.
4. Aleong was on probation when the instant case came before the Board.
5. Aleong was not "getting the message" that he was required to comply with the regulations.
Aleong argues that the Board erred in making findings of fact regarding the aggravating circumstances which were not supported by competent substantial evidence. The DBPR replies that the findings were supported by the record, and thus, must be upheld.
Florida Administrative Code Rule 61G18-30.001(4) (2004), establishes the mitigating and aggravating circumstances which the Board shall consider in deciding the appropriate sanctions:
(a) The danger to the public;
(b) The length of time since the violation;
(c) The number of times the licensee has been previously disciplined by the Board;
(d) The length of time licensee has practiced;
(e) The actual damage, physical or otherwise, caused by the violation;
*193 (f) The deterrent affect [sic] of the penalty imposed;
(g) The affect [sic] of the penalty upon the licensee's livelihood;
(h) Any effort of rehabilitation by the licensee;
(i) The actual knowledge of the licensee pertaining to the violation;
(j) Attempts by licensee to correct or stop violation or refusal by licensee to correct or stop violation;
(k) Related violations against licensee in another state including findings of guilt or innocence, penalties imposed and penalties served;
(l) Actual negligence of the licensee pertaining to any violation;
(m) Penalties imposed for related offenses under subsections (1), (2) and (3) above;
(n) Pecuniary benefit or self-gain enuring to licensee;
(o) Any other relevant mitigating or aggravating factors under the circumstances.
Aleong argues, in part, that the Board erred in finding that he was on probation at the time the present case came before the Board. The DBPR concedes that Aleong was not on probation when he came before the Board for the current charges, but argues that the fact of his previous probation is relevant because one of the enumerated aggravating factors is the deterrent effect of the penalty imposed. Fla. Admin. Code Ann. R. 61G18-30.001(f) (2004). Because the finding is false, it is not supported by competent substantial evidence, and the Board erred in making such a finding. However, the Board is correct in its contention that it could properly find that Aleong was previously on probation and could use this finding to impose sanctions. Therefore, we affirm the Board's decision to impose the same sanctions it had before, but remand for the Board to correct finding number four.
Affirmed in part, reversed in part, and remanded.
FARMER and GERBER, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564365/ | 76 F.2d 935 (1935)
IN RE J. R. PALMENBERG SONS, Inc.
BRONX BRASS FOUNDRY, Inc.,
v.
IRVING TRUST CO.
No. 330.
Circuit Court of Appeals, Second Circuit.
April 15, 1935.
Maxwell H. Goldstein, of New Haven, Conn. (Milton C. Jacobs, of New York City, of counsel), for claimant-appellant Bronx Brass Foundry, Inc.
Otterbourg, Steindler & Houston, of New York City (Aaron Rosen and Arnold A. Jaffee, both of New York City, of counsel), for appellee Irving Trust Co. as Trustee.
Before L. HAND, SWAN, and AUGUSTUS N. HAND, Circuit Judges.
AUGUSTUS N. HAND, Circuit Judge.
Bronx Brass Foundry, Inc., a creditor of the bankrupt, filed its proof of claim for $2,101.10, and Irving Trust Company, the trustee, filed a petition to expunge the claim on the ground that the creditor, within four months prior to the date of filing the petition in bankruptcy, had received an unlawful preference of $1,000 knowing that the bankrupt was insolvent. The referee ordered the claim expunged unless the preferential payments should be restored to the trustee in bankruptcy within twenty days, and also denied an application by the creditor to withdraw its claim. That order was affirmed by the District Court, and the present appeal is taken from the order of affirmance.
When the motion to expunge the claim of the creditor was heard by the referee, the evidence clearly indicated that the creditor was paid $1,000 on account of its claim within four months of the date of the filing of the petition in bankruptcy and at a time when the latter knew that J. R. Palmenberg Sons, Inc., was insolvent, though it is not altogether certain that, if the assets existing at the time of such payment had been applied to the payment of all the creditors, the Bronx Brass Foundry, Inc., would have received more than its pro rata share. Before the hearing was closed, the creditor moved to withdraw the claim so as to avoid a decision by the referee that an unlawful preference had been received. The referee, John E. Joyce, Esq., in denying the motion *936 to withdraw the claim, rendered the following decision:
"When a creditor files a claim against the bankrupt estate he elects a forum which may hear and determine whether a preference to him was made. Although judgment of recovery may not be granted, the finding thereon, subject to review, is conclusive as between the parties. It is not intended that a party shall have two trials of the same issue or be permitted to present the same issue to different tribunals for determination. When issue is joined upon the question whether a voidable preference has been received, the creditor may not withdraw of his own motion and thereby avoid such determination as the proof warrants. In re Helfand Shoe Co. Inc., 22 A. B. R. (N. S.) 487.[1]
"The claim will be expunged unless within twenty days after entry of an order herein the claimant pays to the Trustee the sum of $1,000 with interest from the date of the service of the motion to expunge."
We are satisfied that the decision as well as the reasoning of the referee was entirely correct.
The questions raised by this appeal are: (1) Whether the creditor had an absolute right to withdraw its claim; and (2) whether, if it had not, and the referee properly exercised his discretion in denying the application, the creditor received a voidable preference, though the proof did not show that when it was paid the $1,000, or one-third the amount then due it, the assets were insufficient to pay the other creditors one-third of the amount of their claims.
In support of the absolute right to withdraw the claim the decisions in Ex parte Skinner & Eddy Corp., 265 U.S. 86, 93, 44 S. Ct. 446, 68 L. Ed. 912; Pullman's Palace-Car Co. v. Central Transportation Co., 171 U.S. 138, 146, 18 S. Ct. 808, 43 L. Ed. 108; Scholl Mfg. Co. v. Rodgers, 51 F.(2d) 971 (C. C. A. 8); Deeley v. Cincinnati Art Pub. Co., 23 F.(2d) 920 (C. C. A. 6); and Lawrence Ward's Island Realty Co. v. United States, 209 F. 201, 203 (C. C. A. 2), may be cited in support of the creditor's position. But the decisions of the Supreme Court go no farther than to say that a complainant may discontinue his suit unless its dismissal "would prejudice the defendants in some other way than by the mere prospect of being harassed and vexed by future litigation of the same kind." Ex parte Skinner & Eddy Corp., 265 U.S. 86, at page 93, 44 S. Ct. 446, 448, 68 L. Ed. 912. Thus, if a defendant has interposed a counterclaim, the complainant has no absolute right to discontinue his suit. In Pullman's Palace-Car Co. v. Central Transportation Co., 171 U.S. 138, 146, 18 S. Ct. 808, 811, 43 L. Ed. 108, the court used general language and said: "If the defendants have acquired some rights which might be lost or rendered less efficient by the discontinuance, then the court, in the exercise of a sound discretion, may deny the application." If leave to withdraw the claim had been granted, the trustee would have lost the right to litigate, in connection with its motion to expunge, the question whether the creditor had acquired a preference. Though the denial of leave did not entitle the trustee to a recovery, it did establish the fact of a preference, and left nothing for subsequent litigation except the amount of the claim. Everything else is res judicata. To have deprived the trustee of the right to establish in the summary proceeding the fact of a preference would have been to take away a substantial right.
In Scholl Mfg. Co. v. Rodgers, 51 F.(2d) 971 (C. C. A. 8), and in Deeley v. Cincinnati Art Pub. Co., 23 F. (2d) 920 (C. C. A. 6), it was said that such prejudice as we have mentioned was insufficient to bar the right of a creditor to withdraw his claim, but, with all respect, we do not think it necessary or desirable to allow the process of the court to be trifled with by creditors whose rights have to be disposed of, if there is to be convenient and speedy administration of the estates of bankrupts.
Several District Courts of the Second Circuit have adopted local rules making the dismissal of suits in equity discretionary and we have approved such local rules. The present rule of the Southern District of New York reads as follows: "2. Voluntary Discontinuances. If justice require, the Court, after issue joined, may refuse to permit the plaintiff to discontinue even though the defendant cannot have affirmative relief under the pleadings and though his only prejudice be the vexation and expense of a possible second suit upon the same cause of action." We think the foregoing rule valid and regard the right to discontinue as procedural rather than substantive and within the power of judicial regulation. While these rules do not in terms apply to bankruptcy courts, proceedings in those courts are in the nature of proceedings in equity, *937 Bardes v. First Nat. Bank of Hawarden, 178 U.S. 524, 535, 20 S. Ct. 1000, 44 L. Ed. 1175, and the local rules we have mentioned indicate that the present judicial attitude toward the right to discontinue a suit or proceeding is more liberal than formerly.
It would have been particularly unreasonable to allow the creditor in the present proceeding to withdraw its claim. At the time when the application for leave to withdraw was made, the question whether the bankrupt was insolvent, and whether the creditor had reasonable cause to believe that a preference would be effected by the payment, had already been litigated before the referee at several hearings and the evidence was almost closed. It is impossible to discover any merit in the creditor's application, and the granting of it would have involved at least some prejudice to the estate. In such circumstances denial was entirely justified. Smith v. Carlisle (C. C. A.) 228 F. 666.
The claim that the payment of $1,000 within the four months' period was not a voidable preference, unless it represented a larger percentage than the other creditors would have received, had the assets of the bankrupt been liquidated and distributed at the time when the payment was made, is thought to be substantiated by decisions of the Court of Appeals of the Eighth Circuit in Haas v. Sachs, 68 F.(2d) 623; Mansfield Lumber Co. v. Sternberg, 38 F.(2d) 614, 617, and W. S. Peck & Co. v. Whitmer, 231 F. 893, 897. But we do not agree with the interpretation of section 60 of the Bankruptcy Act, 11 USCA § 96, on which those decisions were based. The retention by Bronx Brass Foundry, Inc., of the $1,000 received from the insolvent would result in giving it an advantage over the other creditors. The claim, before that payment was made, amounted to $3,000. If another creditor had a claim of $3,000 and the estate paid a dividend of 50 per cent., Bronx Brass Foundry, Inc., would receive $2,000 in all, while the other creditor, though having a claim in the same amount, would receive but $1,500. The fallacy of the contention on the part of Bronx Brass Foundry, Inc., was pointed out by Judge Knappen in Commerce-Guardian Trust & Savings Bank v. Devlin, 6 F.(2d) 518, 519 (C. C. A. 6).
Whether a creditor of an insolvent has received an unlawful preference is not to be determined by what the situation would have been if the estate had been completely liquidated and distributed among all the creditors at the time when the alleged preferential payment was made, but upon whether the ultimate result of a payment by a known insolvent "will be to enable any one of his creditors to obtain a greater percentage of his debt than any other of such creditors of the same class." Bankruptcy Act § 60a, 11 USCA § 96 (a).
Inasmuch as the retention by the creditor of $1,000 would work a preference in the present case, the referee properly required the return of that sum to the trustee as a condition of the allowance of the claim. Bankruptcy Act § 57g, 11 USCA § 93 (g).
Order affirmed.
NOTES
[1] Referee's opinion. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564363/ | 76 F.2d 628 (1935)
BRADFORD
v.
FAHEY et al. (two cases).[*]
Nos. 3778, 3797.
Circuit Court of Appeals, Fourth Circuit.
April 2, 1935.
*629 Morton P. Fisher and Allan H. Fisher, both of Baltimore, Md. (A. Freeborn Brown, of Bel Air, Md., on the brief), for appellant.
Wade B. Hampton, of Washington, D. C., and Clarence E. Martin, of Martinsburg, W. Va. (Robinson & Fahey, of Bel Air, Md., on the brief), for appellees Michael W. Fahey, assignee, and Potomac Joint Stock Land Bank of Alexandria.
Herbert Levy, of Baltimore, Md. (Morris Rosenberg, of Baltimore, Md., on the brief), for appellees John D. and Annie McC. Worthington.
Edwin A. Krauthoff, of Chicago, Ill., amicus curiæ.
Before PARKER, NORTHCOTT, and SOPER, Circuit Judges.
PARKER, Circuit Judge.
This is an appeal in bankruptcy proceedings from an order denying the prayer of a petition, which was filed under subsection (s) of section 75 of the Bankruptcy Act, as added by Act June 28, 1934 (11 USCA § 203 (s), and which asked that the court enjoin further prosecution of proceedings which had been commenced in the circuit court of Harford county, Md., to foreclose a mortgage on the farm of petitioner. The mortgage resisted the petition on two grounds: (1) That the court of bankruptcy could not *630 interfere with the state court's jurisdiction, which had attached in the proceedings to foreclose the mortgage; and (2) that subsection (s) (7) of section 75 of the Bankruptcy Act, as added in 1934 (11 USCA § 203 (s) (7), was unconstitutional and therefore furnished no basis upon which the ultimate relief sought might be granted. The District Judge held against the mortgagee on the first ground, but sustained the second and denied the petition because in his opinion the subsection of the Bankruptcy Act under which the petition was filed was violative of the "due process" clause of the Fifth Amendment. The petitioner has appealed.
There is no dispute as to the facts, which may be briefly stated as follows: On February 6, 1926, the petitioner William W. Bradford, Jr., a farmer of Harford county, Md., executed a mortgage on 145 acres of land to the Potomac Joint Stock Land Bank of Alexandria to secure a debt of $20,000. On April 16, 1934, there was due on the mortgage debt a balance of amortization payments in excess of $1,000 and certain insurance premiums which the mortgagee had advanced; and on that date the mortgagee, acting under the terms of the mortgage, declared the whole debt, amounting to $19,497.23, to be due, and assigned the mortgage to Michael W. Fahey for the purpose of foreclosure. Fahey proceeded to advertise and sell the mortgaged property under the power contained in the mortgage, docketing the foreclosure proceedings in the circuit court of Harford county, Md., in accordance with the provisions of the Maryland law. The sale was held on June 18, 1934, when John D. Worthington and wife became the last and highest bidders for the property at the price of $21,500 and deposited $2,150 with the assignee to be applied on the purchase price. On June 19th, Fahey reported the sale to the clerk of the court, and the usual order nisi was entered requiring notice to be given that the sale would be confirmed unless cause to the contrary should be shown on or before the 19th day of July. Exceptions to the sale were filed by the petitioner Bradford, but these have not been passed on because of the proceedings taken in this cause.
On July 17th, two days before the order nisi was returnable, Bradford filed his petition in the court below under section 75 of the Bankruptcy Act, alleging that he was a farmer, that he was unable to meet his debts as they matured, and that he desired to effect a composition or extension of his debts as provided by that section. The proceedings in the state court were stayed pursuant to the prayer of the petition, and the case was set for hearing on September 6th. In the meantime answers were filed by Fahey and the Worthingtons and the land bank was made a party. Letters were sent to the various creditors offering a composition, but on the morning of the hearing petitioner was notified that his offer would be refused by the land bank, and, as the debt owing to it was more than the other indebtedness of petitioner, there resulted a failure to obtain such an acceptance of the offer of composition as was required by the section. Petitioner thereupon amended his petition and asked to be adjudicated a bankrupt and granted relief pursuant to subsection (s) of the section and that the foreclosure proceedings in the state court be permanently enjoined. At this time it was formally and definitely stated by counsel for petitioner that he would elect to purchase the property embraced in the land bank's mortgage pursuant to the terms prescribed in subsection (s) and by counsel for the mortgagee that it did and would object thereto. The court approved the petition as properly filed and passed an order adjudicating Bradford a bankrupt, but, being of opinion that paragraph 7 of subsection (s) was unconstitutional, refused to stay proceedings in the state court. The matter complained of on this appeal is this refusal to stay proceedings.
A preliminary question which arises is whether the appeal is not premature, as the right of petitioner to relief under paragraph 7 of subsection (s) of the act would arise only after there had been an appraisal of the property, an offer to purchase at the appraised price and a refusal on the part of the lienholder to accept this offer. But the answer to this is that the appeal is from the refusal to stay proceedings in the state court, and under the provisions of the act, if valid, these proceedings should be stayed while the appraisal and other proceedings preliminary to the right to relief under paragraph 7 are going forward, if the court has jurisdiction to stay such proceedings. Subsection (s) is not an independent statute but an amendment to section 75 as enacted by the Act of March 3, 1933. Under subsections (n) and (o) of that section (11 USCA § 203 (n, o), the property of the farmer wherever situate is subjected to the exclusive jurisdiction of the court of bankruptcy, and it is forbidden that proceedings for *631 foreclosure of a mortgage thereon be instituted or maintained in any other court without the permission of the court of bankruptcy. Proceedings under subsection (s) are but a continuation of proceedings theretofore instituted under other provisions of the section; and the provisions for staying foreclosure in a state court are clearly applicable for the purpose of protecting the court's jurisdiction while such proceedings are going forward. A denial of the stay on the ground that paragraph 7 of subsection (s) was unconstitutional, after a petition had been filed asking relief under that subsection, was clearly appealable, therefore, irrespective of whether or not the proceedings had gone forward to the point where petitioner was entitled to the relief provided by that paragraph.
With this preliminary question out of the way, three questions are raised for our consideration by the appeal, viz.: (1) Whether subsection (s) of section 75 of the Bankruptcy Act, and particularly paragraph 7 thereof, is a constitutional exercise of the bankruptcy power of Congress; (2) whether a court of bankruptcy has jurisdiction under section 75 of the Bankruptcy Act to stay proceedings for foreclosure of a mortgage already pending in a state court where relief is asked under subsection (s) of the section; and (3) whether this jurisdiction may be exercised with respect to a foreclosure suit in Maryland, where there has been a sale of the mortgaged property under order of court but the sale has not been confirmed. We think that all of these questions must be answered in the affirmative.
The bankruptcy power of Congress is conferred by article 1, § 8, cl. 4 of the Constitution, which provides that Congress shall have power "to establish * * * uniform Laws on the subject of Bankruptcies throughout the United States." It is correlative to the clause of article 1, § 10, which provides that "no State shall * * * pass any * * * Law impairing the Obligation of Contracts." It was realized at the time of the adoption of the Constitution that uniform laws on the subject of bankruptcies were important in the development of interstate and foreign commerce, over which Congress was given control; and not only was Congress vested with the power to establish such uniform laws, but the states were expressly forbidden to exercise the power usually involved in bankruptcy laws, i. e. the power of impairing the obligation of contracts. The subject is dealt with in one sentence in that great commentary on the Constitution, the Federalist Papers (XLI), where it is said: "The power of establishing uniform laws of bankruptcy is so intimately connected with the regulation of commerce, and will prevent so many frauds where the parties or their property may lie, or be removed into different states, that the expediency of it seems not likely to be drawn in question."
What is a law on the subject of bankruptcies within the meaning of the Constitution has never received exact definition at the hands of the Supreme Court, but there can be no question, we think, but that the constitutional grant vests in Congress full power to deal with the relationship existing between debtors unable or unwilling to pay their debts and their creditors, and that we may safely say, without attempting to delimit the power, that any law must be held to be a law on the subject of bankruptcies, which provides for the surrender of the property of a debtor to a court, its control and administration by the court with the eventual application of the property or its value to the claims of creditors, and the discharge of the debtor from the remainder of his debts. As we said in the recent case of Campbell v. Alleghany Corporation (C. C. A. 4) 75 F.(2d) 947, which dealt with the validity of the corporate reorganization section of the Bankruptcy Act: "All phases of the relationship between a debtor financially embarrassed and his creditors are brought under the control of Congress by the constitutional grant of power; and the fact that a particular mode has hitherto been employed in dealing with this relationship is not to be taken as a measure of the power over it. Hanover Nat. Bank v. Moyses, 186 U.S. 181, 22 S. Ct. 857, 46 L. Ed. 1113; Sturges v. Crowninshield, 4 Wheat. 122, 4 L. Ed. 529; In re Landquist (C. C. A. 7) 70 F.(2d) 929, 931; In re Klein, Fed. Cas. No. 7,865, reported as note to Nelson v. Carland, 1 How. 265, 277, 11 L. Ed. 126, 130; In re Reiman, 7 Ben. 455, Fed. Cas. No. 11,673; Kunzler v. Kohaus, 5 Hill [N. Y.] 317."
In Story on the Constitution, § 1113, quoted with approval by Judge, later Mr. Justice, Blatchford, in In re Reiman, supra, it is said: "Perhaps, as satisfactory a description of a bankrupt law as can be framed is, that it is a law for the benefit and relief of creditors and their debtors, in cases in which the latter are unable or unwilling to pay their debts. And a law on the subject of bankruptcies, in the sense of the constitution, *632 is a law making provisions for cases of persons failing to pay their debts."
And Judge Blatchford in his opinion in the case cited defines the "subject of bankruptcies" as used in the constitutional grant of power as follows: "What is `the subject of bankruptcies?' It is not, properly, anything less than the subject of the relations between an insolvent or non-paying or fraudulent debtor, and his creditors, extending to his and their relief. It comprises the satisfaction of the debt for a sum less than its amount, with the relief of the debtor from liability for the unpaid balance, and the right of the creditor to require that the amount paid in satisfaction shall be substantially as great a pro rata share of the property possessed by the debtor as it can pay, or can reasonably be expected to pay."
It is clear that the power of Congress over bankruptcies is not limited by the terms of the British and colonial statutes as they existed at the time of the adoption of the Constitution. As was well said by Mr. Justice Hunt, in affirming the decree of Judge Blatchford in the Reiman Case (Fed. Cas. No. 11,675): "The argument, that the subject of bankruptcies is to be interpreted and limited by the British and colonial statutes, as they existed at the time of the separation of this country from Great Britain, is quite too narrow. No country can afford to be thus cut off from all possible improvement in its legislation. Whatever relates to the subject of bankruptcy is within the jurisdiction of congress; and, to say that the law as existing at the time of the Revolution, or the adoption of the constitution, shall furnish the rule and limitation of legislation, would take a large part of the subject out of their jurisdiction. While it is true that all proper bankrupt laws and insolvent laws are based upon the theory of a surrender of the bankrupt's property, none of them require such surrender to be entire and absolute." See, also, opinion of the Supreme Court in Hanover Nat. Bank v. Moyses, supra, and opinion of this Court in Campbell v. Alleghany Corporation, supra.
Nor are the limits of the bankruptcy power to be sought in the exercise which Congress has made of that power. Congress made no exercise of the bankruptcy power whatever until 1800 (2 Stat. 19), when an act along the line of the English bankruptcy acts relating to traders was passed, which was repealed, however, in 1803 (2 Stat. 248). The power was again exercised by the passage of an act in 1841 (5 Stat. 440), but this act was repealed in 1843 (5 Stat. 614). In 1867 the third Bankruptcy Act was passed (14 Stat. 517); and it remained in force for only eleven years, being repealed in 1878 (20 Stat. 99). In 1898 the present Bankruptcy Act (11 USCA) was passed. It has been well described (1 Remington on Bankruptcy p. 18) as: "A system of laws for the taking possession of the assets of an insolvent, either upon his own initiative or, in case he has done certain acts called acts of bankruptcy, considered to demonstrate his unworthiness or incapacity properly to continue his business, upon the initiative of his creditors; for recovering such of his assets as have been transferred fraudulently to third parties or unfairly to particular preferred creditors or have been seized by creditors while the debtor was insolvent; for selling the assets and distributing the proceeds equitably amongst his creditors; and finally for granting to him, in case he has surrendered all his assets and disclosed to his creditors in bankruptcy the truth about his business, a discharge from the unpaid deficit of his debts." But not even the act of 1898 fully covered the subject of bankruptcy. It made no adequate provision for extension of time to insolvents, for corporate reorganization, for relief of embarrassed railroad corporations or for relief of agricultural debtors. It was designed primarily for the relief of those whose debts had been incurred in mercantile and manufacturing pursuits and their creditors; and only in this field did it afford relief which could be said to be adequate.
In 1933, however, a much wider exercise of the bankruptcy power on the part of Congress became imperative. The period of industrial expansion which followed the world war witnessed an unprecedented expansion of credit throughout the country. Bonds were issued by both public and private corporations in amounts far beyond any ability on their part to pay in normal times, and private individuals borrowed on real estate mortgages to an extent that had never before been thought possible. This period of prosperity and expansion of credit had been followed by an economic depression world wide in scope, property values had dwindled to a mere fraction of what they had been, and the national income had shrunk to the extent that the payment even of the interest on this vast volume of indebtedness was out of the question. Relief was needed in the form of bankruptcy laws, which would enable the people to face reality *633 with respect to the altered condition of their debt structure and would enable business to go forward unhampered by obligations which were impossible of fulfillment. Congress accordingly passed the amendment of March 3, 1933, to the Bankruptcy Act. 47 Stat. 1467. This amendment added four sections to the act: Section 74 (see 11 US CA § 202), which provided for compositions and extensions by distressed debtors without an adjudication of bankruptcy; section 75 (see 11 USCA § 203), which provided a special plan for the relief of agricultural debtors; section 76 (see 11 USCA § 204), which granted relief to persons secondarily liable on obligations of distressed debtors; and section 77 (11 USCA § 205), which provided for the reorganization of insolvent railroads. Sections 74 and 77, as thus enacted, have been sustained, as a valid exercise of the bankruptcy power. In re Landquist (C. C. A. 7) 70 F.(2d) 929; In re Chicago R. I. & P. R. Co. (C. C. A. 7) 72 F.(2d) 443.
It was soon apparent, however, that the amendments of 1933 did not adequately meet the situation. Something was needed which would enable insolvent corporations and farmers to obtain relief from their debt burdens without forcing a sale of their property, and, in the case of farmers, without putting them off of the land which they had been cultivating to join the army of the destitute and unemployed. Congress accordingly, on June 7, 1934, passed the Corporate Reorganization Act, as section 77B of the Bankruptcy Act (11 USCA § 207), and on June 28, 1934, passed the Frazier-Lemke Act adding subsection (s) to section 75 of the Bankruptcy Act (11 USCA § 203 (s). Both of these acts provide relief in bankruptcy for embarrassed debtors and their creditors under the supervision of the court without requiring a sale of the property of the debtor. We have recently passed upon the Corporate Reorganization Act and have held it valid. Campbell v. Alleghany Corporation, supra.
Both section 75 as originally enacted and the Frazier-Lemke Act, adding subsection (s) thereto, are emergency legislation, enacted to meet the conditions brought about by the economic depression. Subsection (c) of section 75 (11 USCA § 203 (c) limits the time within which petitions may be filed thereunder to five years, and the provisions of subsection (s), the Frazier-Lemke Act, are applicable only to debts existing at the time of its passage. As originally enacted the section provided merely for extensions and compositions for agricultural debtors, when accepted by a majority in number and amount of the claims against them, and when approved by the court as for the best interest of all creditors and as including an equitable and feasible method of liquidation for secured creditors and of financial rehabilitation for the farmer. See subsections (g) and (i), 11 USCA § 203 (g, i). Compositions and extensions thereunder did not "reduce the amount of nor impair the lien of any secured creditor" but affected "only the time and method of its liquidation." Subsection (k), 11 USCA § 203 (k). There can be no question but that under the principles discussed by us in Campbell v. Alleghany Corporation, supra, the section as originally enacted was valid.
Subsection (s), added by the Frazier-Lemke Act, provides for cases where a farmer who has filed a petition under section 75 has failed to obtain the acceptance by creditors of an extension or composition proposal offered, or who may feel aggrieved by the composition or extension as finally approved. Such farmer is authorized to amend his petition or answer so as to ask that he be adjudged a bankrupt. Provision is then made, under paragraphs (1) to (6) of the subsection (11 USCA § 203 (s) (1-6), for the valuation of his property by appraisers, subject to review by the court, and for the purchase by him of all or any part of the property at the valuations so fixed, upon making payments which are spread over a period of six years. As the right of the farmer to purchase the property under these sections is dependent upon the consent of lienholders, and as the lienholder here has not given such consent, the validity of these purchase provisions is not before us. Upon the principles hereafter discussed, however, we see no reason to doubt their validity. Where a secured creditor objects to the sale to the farmer in accordance with these provisions, however, provision is made under paragraph (7) that proceedings be stayed, that the farmer have the right to retain possession of the property for five years upon paying a reasonable annual rental to be fixed by the court, and that he have the right to purchase the property at any time within the five years upon paying the appraised price of the property, with the right on the part of the lienholder to demand a reappraisal of the property and payment of the amount thereof in lieu of the amount of the original appraisal, if it is acceptable to him. Paragraph (1) of the subsection relating *634 to appraisal of the property of the bankrupt and paragraph (7), upon which the rights of the petitioner here depend are as follows:
"(1) Upon such a request being made in the petition or answer, at the time of the first hearing, appraisers shall be designated and appointed. Such appraisers shall appraise all the property of the debtor at its then fair and reasonable value, not necessarily the market value at the time of such appraisal. The appraisals shall be made in all other respects, with right of objections, exceptions, and appeal, in accordance with this Act [title]: Provided, That in case of real estate either party may file objections, exceptions, and appeals within one year from date of order approving the appraisal."
"(7) If any secured creditor of the debtor, affected thereby, shall file written objections to the manner of payments and distribution of debtor's property as herein provided for, then the court, after having set aside the debtor's exemptions as prescribed by the State law, shall stay all proceedings for a period of five years, during which five years the debtor shall retain possession of all or any part of his property, under the control of the court, provided he pays a reasonable rental annually for that part of the property of which he retains possession; the first payment of such rental to be made within six months of the date of the order staying proceedings, such rental to be distributed among the secured and unsecured creditors, as their interests may appear, under the provisions of this Act [title]. At the end of five years, or prior thereto, the debtor may pay into court the appraised price of the property of which he retains possession; Provided, That upon request of any lien holder on real estate the court shall cause a reappraisal of such real estate and the debtor may then pay the reappraised price, if acceptable to the lien holder, into the court, otherwise the original appraisal price shall be paid into court, and thereupon the court shall, by an order, turn over full possession and title of said property to the debtor and he may apply for his discharge as provided for by this Act [title]: Provided, however, That the provisions of this Act [subsection] shall apply only to debts existing at the time this Act becomes effective [June 28, 1934]."
As the paragraphs which we have quoted are amendments of the General Bankruptcy Law, it is clear that the appraisals for which provision is made are to be conducted as are other appraisals in bankruptcy under the supervision and approval of the court, with the added safeguard that, in the case of real estate, objections, exceptions, and appeals may be filed within one year of the order approving the appraisal. The price at which the farmer may purchase the property, therefore, is not some arbitrary figure arrived at by friendly appraisers, as has been argued, but the fair and reasonable value of the property as determined by the court in a judicial proceeding after notice and hearing. The appraisal is to be made of the property "at its then fair and reasonable value, not necessarily the market value at the time of such appraisal." Congress doubtless realized that, as a result of the economic depression, much valuable farm property had little or no market value at the time, and that it would be unfair to creditors to value the property on the basis of its then market value. In arriving at its fair and reasonable value, the appraisers and the court were authorized to take into consideration all the circumstances bearing upon value, not merely the market value at the time of the appraisal, just as a public service commission may consider such circumstances in valuing property for rate making purposes. The cost of the property, the cost of improvements made upon it, its depreciation, its productive capacity, reproduction cost, or the cost of acquiring like property, the history of values in the immediate locality all of these and other like matters, as well as market value, would be proper subjects of consideration in determining fair and reasonable value. The rule prescribed is eminently fair to creditors, as it is hardly conceivable that a court would approve an appraisal as a fair and reasonable value which was less than market value. And the danger that the farmer might avail himself of the provisions of the act to speculate upon the chances of a rise in the value of the property without obligating himself to purchase it, is obviated by the provision which allows the lienholder to demand a reappraisal. If the farmer elects to purchase, he must pay either the original appraisal or this reappraisal, whichever is higher.
It is of course no ground of constitutional objection that the section here in question relates only to farmers; for it is well settled that the uniformity prescribed *635 by the Constitution is "geographical and not personal" and that bankruptcy legislation need not apply to all classes of persons in the same way. Hanover Nat. Bank v. Moyses, supra, 186 U.S. 181, 188, 22 S. Ct. 857, 46 L. Ed. 1113; Stellwagen v. Clum, 245 U.S. 605, 613, 38 S. Ct. 215, 62 L. Ed. 507; Leidigh Carriage Co. v. Stengel (C. C. A. 6) 95 F. 637; In re California Pac. Ry. Co., 3 Sawy. 240, Fed. Cas. No. 2,315; Campbell v. Alleghany Corporation, supra. And it does not furnish ground of objection that secured debts are affected, or that property which has been mortgaged by the bankrupt is to be administered by the bankruptcy court. Under the Bankruptcy Law as it existed prior to the recent amendments the court in ordering the sale of the bankrupt's property free of liens administers his encumbered property, as well as that which is unencumbered. See Van Huffel v. Harkelrode, 284 U.S. 225, 227, 52 S. Ct. 115, 76 L. Ed. 256, 78 A. L. R. 453; Federal Land Bank of Baltimore v. Kurtz (C. C. A. 4) 70 F.(2d) 46; Allebach v. Thomas (C. C. A. 4) 16 F.(2d) 853. "A secured debt or lien is, so far as the Constitution of the United States is concerned, a no more sacred kind of property than an unsecured debt. * * * And the Constitution expressly permits and grants to Congress the exercise of the power to affect such property, whether it be an unsecured debt or whether it be a lien, by laws relating to the `subject of Bankruptcies.'" In re Burgh, 7 F. Supp. 184, 185; Campbell v. Alleghany Corporation, supra.
The case, then, comes to this: Whether the act is to be condemned as not being in fact a law on the subject of bankruptcies or as denying the due process guaranteed by the Fifth Amendment, either because it permits the farmer to purchase the encumbered property at the valuation fixed by the court instead of requiring that it be sold at public auction, with right on the part of the lienholder to bid at the sale, or because it permits a delay of five years, during which the property is to be rented to the farmer, before requiring that the value as determined by the court be collected and distributed to lienholders and other creditors.
There can be little doubt as to the law being a law on the subject of bankruptcies within the meaning of those words as used in the Constitution. It applies only to farmers who are unable to pay their debts and ask to be adjudged bankrupt. It requires the surrender of their property into the control of the court of bankruptcy. It provides for the valuation of this property and that such valuation be paid to creditors. It grants to the bankrupt a discharge from his debts. That the property of the bankrupt is to be operated under the direction of the court until such time as it can be disposed of to advantage, is, of course, not inconsistent with the purposes of a bankruptcy act; and there is nothing in the nature of bankruptcy which requires that the debtor's property be actually sold and the proceeds thereof distributed among creditors. If the creditors receive the value of the property, they have received all to which they are reasonably entitled. The corporate reorganization act rests on this basis; and there is no reason why Congress should not apply the same principles to the relief of insolvent farmers. See discussion of this question as applied to corporate reorganization in Campbell v. Alleghany Corporation, supra.
Of course, a bankruptcy law must not offend against the due process clause of the Fifth Amendment, which is a limitation upon all of the powers conferred by the people upon the federal government. Hanover Nat. Bank v. Moyses, supra. But as any exercise of the bankruptcy power impairs the obligation of contracts, such impairment is not to be taken as in itself a denial of due process. For the provisions of the act to violate the amendment, they must be so grossly arbitrary and unreasonable as to be "incompatible with fundamental law"; and, when consideration is given to the situation which confronted Congress at the time of the passage of the act, we do not think that its provisions can be said to violate this rule. The situation, which still continues in large measure, was that agriculture throughout the United States was prostrate and dispairing. A huge volume of debt, estimated at between eight and nine billions of dollars, had been piled up by the farmers in the period of expansion, and this was represented in large part by mortgages on land. As a result of the decline in the prices of agricultural products, the farmers were without means to pay even the interest on this huge volume of debt, and there was default throughout the country on agricultural mortgages. Foreclosures on an unprecedented scale were imminent; but such foreclosures, while fraught with ruin to the farmer debtors, would not have resulted in payment of the debts, as land had so declined in value that only in rare instances could *636 it be sold for anything like the amount of the debt against it. To have permitted these foreclosures to proceed would have meant the purchasing of the land by the lienholders, the eviction of owners who were settled on the land and a great increase in tenant farming. It was in the public interest that the farmer be kept on his farm, that, if possible, his interest as an owner of the farm be maintained, and that its value as a going concern be preserved.
It was to meet this emergency situation that the statute in question was enacted. The interests of the creditor were protected by having the property valued under the direction and subject to the approval of the court, and by providing that the creditor should ultimately receive this valuation. The farmer was kept on the farm and its value as a going concern was preserved by providing that it should be rented to the owner at a rental to be fixed by the court, and that he should have the right to purchase it at the fair and reasonable value which the court should determine.
The operation of mortgaged property under the control of the court is, of course, nothing new. It is a common thing for foreclosure proceedings to be delayed while the court operates the property of debtor corporations for the purpose of preserving its going concern value in the interest of stockholders as well as creditors until a sale can be advantageously made; and it should not be held "so grossly arbitrary and unreasonable as to be incompatible with fundamental law" that Congress, when faced with a great economic emergency, has prescribed for the relief of agricultural debtors and their creditors, a procedure which involves the operation of agricultural property under the supervision of the court to the end that its value may be preserved in the interest of all parties concerned. The fact that the court is to rent the property, instead of operating it through a receiver, is a difference of detail in management and not a difference in principle.
And the right, accorded the farmer, to purchase at the valuation fixed by the court, is no more than the right accorded the debtor under the corporate reorganization act which we have upheld. If the creditor receives the value of the property, it is no concern of his who the purchaser may be; and as we have seen, the act provides for the determination of value by the court in a judicial proceeding in which the creditor is given full opportunity to be heard.
As a matter of fact, no property in any real sense is taken from the lienholder by reason of the provisions of the act. The mortgaged property has already shrunk in value before the proceedings under the act are instituted; and the proceedings merely scale down the secured portion of the debt to the value of the encumbered property and transfer the lien of the encumbrance to the proceeds of that property when paid into court. While the lienholder is delayed in getting his money, the delay is probably not for so long a time, or the loss so great, as would result to him if the act were not passed and wholesale foreclosures of real estate mortgages should result. While generally regarded as a measure for the relief of farmer debtors, it is clear that the act is at the same time one in the interest of their creditors also; for creditors of farmers would have nothing to gain, even with respect to the collection of their debts, from the financial debacle which would result from the wholesale foreclosure of farm mortgages, in which their collateral would be rendered practically worthless. In this connection, it may not be amiss to consider the closing paragraphs of the report of the Senate Judiciary Committee, reporting on the act. (Report No. 1215, 73d Congress, 2d Session). They are as follows:
"In short, all that this amendment does is to carry out the purpose of section 75 and adjust and scale down existing farm indebtedness to the present value of his property, and it gives the debtor farmer an opportunity to save his home and maintain his property by paying for it on the installment plan while the property remains under the control of the court. Section 75 itself is an emergency act and has only about 3½ years to run. Therefore this amendment will cease to exist when the time limit of section 75 expires.
"This amendment will make it possible for the Federal Farm Credit Administration, through the Federal land banks, to function by adjusting and scaling down the indebtedness to somewhere within the reasonable value of the property. This amendment in no way affects existing liens or encumbrances except that it scales them down to the present value of the encumbered property, and then transfers the lien or liens to the proceeds of that property when paid into court.
*637 "On the average, under its provisions, the lienholders and creditors of the debtor farmer, on a whole, will receive unquestionably larger returns than under the present system where the property is thrown upon the market and sold at public auction. It gives a reasonable time and gives the original owner an opportunity to protect his property, and therefore his home."
If the states, as has been held in Home Building & Loan Association v. Blaisdell, 290 U.S. 398, 54 S. Ct. 231, 235, 78 L. Ed. 413, 88 A. L. R. 1481, may in times of emergency exercise their police power to grant a moratorium against the foreclosure of mortgages, notwithstanding the limitations of the contract clause of the Constitution, then certainly Congress, which has been given express power upon the subject of bankruptcies, may exercise that power in the enactment of bankruptcy laws designed to meet the emergency, even though the exercise may delay the collection of the debts due by the bankrupt. As has been often said, the bankruptcy power, like the other powers granted to the federal government, is plenary. It is to be used, as are the other granted powers, to "promote the general welfare." And in times of emergency it should be exercised, reasonably of course and in the spirit of the Constitution, but in a way, if possible, to meet the problems of the emergency. As said by the Chief Justice in the Blaisdell Case: "While emergency does not create power, emergency may furnish the occasion for the exercise of power. `Although an emergency may not call into life a power which has never lived, nevertheless emergency may afford a reason for the exertion of a living power already enjoyed.' Wilson v. New, 243 U.S. 332, 348, 37 S. Ct. 298, 302, 61 L. Ed. 755, L. R. A. 1917E, 938, Ann. Cas. 1918A, 1024. The constitutional question presented in the light of an emergency is whether the power possessed embraces the particular exercise of it in response to particular conditions."
The most serious question presented is as to the five year delay which the statute interposes to the rights of the creditor. It may be conceded that under ordinary conditions, this provision would be so arbitrary and unreasonable as to offend against the provisions of the Fifth Amendment; but we are not prepared to say that it may be so condemned when viewed in the light of the emergency which confronted Congress. Whether after the economic depression shall have passed and conditions shall have returned to normal the act can be sustained, is a question which is not before us; but the law is well settled that "it is always open to judicial inquiry whether the exigency still exists upon which the continued operation of the law depends." Home Building & Loan Association v. Blaisdell, supra, 290 U.S. 398, 442, 54 S. Ct. 231, 241, 78 L. Ed. 413, 88 A. L. R. 1481; Chastleton Corp. v. Sinclair, 264 U.S. 543, 547, 548, 44 S. Ct. 405, 68 L. Ed. 841.
The act in question has been upheld as constitutional by the Circuit Court of Appeals of the Sixth Circuit in Louisville Joint Stock Land Bank v. Radford (C. C. A. 6) 74 F.(2d) 576; by Judge Dawson in the same case in the District Court In re Radford, 8 F. Supp. 489; by Judge Symes in In re Cope (D. C.) 8 F. Supp. 778; and by Judge Atwell in Paine v. Capitol Freehold Land Co. (D. C.) 8 F. Supp. 500.
We come then to the question as to whether the court of bankruptcy had jurisdiction to stay proceedings for foreclosure of a mortgage already pending in a state court; and it is clear that prior to the enactment of the amendment of March 3, 1933, it had no such power. Straton v. New, 283 U.S. 318, 51 S. Ct. 465, 75 L. Ed. 1060; In re Hurlock (D. C.) 23 F.(2d) 500. This was because the jurisdiction of the state court and the bankruptcy court in matters of foreclosure was concurrent, and on principles of comity the bankruptcy court would not attempt to interfere with the jurisdiction of the state court. Under subsection (n) of section 75 (11 USCA § 203 (n), however, the bankruptcy court was given exclusive jurisdiction over the property of the farmer debtor; and under subsection (o) (11 USCA § 203 (o) it was expressly provided that proceedings for the foreclosure of mortgages should not be instituted, or, if instituted prior to the filing of the petition, should not be maintained. Under such circumstances there can be no question but that the jurisdiction of the bankruptcy court over the property was paramount and exclusive, and that it was the duty of the court to protect this jurisdiction by injunction or other appropriate process. In such case the power of the court is analogous to that which it possesses where the property of the bankrupt is in possession of the receiver of a state court appointed within four months of *638 the filing of the petition in bankruptcy. See In re Watts, 190 U.S. 1, 23 S. Ct. 718, 47 L. Ed. 933; Bailey v. Blackmon (C. C. A. 4) 14 F.(2d) 16, 19, 20; Gamble v. Daniel (C. C. A. 8) 39 F.(2d) 447; Miller v. Potts (C. C. A. 6) 26 F.(2d) 851.
It is argued that the power of the court of bankruptcy to stay proceedings ended with the rejection of the proposition for composition or extension submitted under section 75 as originally enacted. This, however, fails to take account of the fact that subsection (s), the Frazier-Lemke Act, is a mere addition to section 75 of the Bankruptcy Act, and that the procedure provided for thereunder is merely a continuation of the procedure which must be begun under other subsections of section 75. For the court to afford the relief which the section as amended contemplates, it is necessary that the exclusive and paramount jurisdiction of the court over the property of the bankrupt be maintained; and there can be no question but that the provisions of subsections (n) and (o) apply as well to proceedings continued under subsection (s) as to proceedings under the other provisions of section 75.
And we do not think that the right to stay proceedings in the state court is precluded because a sale has taken place in foreclosure proceedings if there has been no confirmation of the sale. Of course, where the property of the bankrupt has finally passed from him under a foreclosure proceeding, the bankruptcy court has no power over it; for the bankruptcy court is given jurisdiction only over property of the bankrupt, and, when he has ceased to have an interest in the property as the result of foreclosure, no basis exists for a stay of proceedings under the act. In re Arend (D. C.) 8 F. Supp. 211, 212; In re Klein (D. C.) 9 F. Supp. 57, 59; In re Stacy (D. C.) 9 F. Supp. 61; In re Smith (D. C.) 7 F. Supp. 863. Under the law of Maryland, however, the defendant in foreclosure does not lose his interest in the property sold at foreclosure sale until the same is confirmed and the purchase money paid. It is provided by the Maryland Code (article 66, § 11) that "all such sales, when confirmed by the court and the purchase money is paid, shall pass all the title which the mortgagor had in the said mortgaged premises at the time of the recording of the mortgage." Until confirmation and payment of the purchase money, the property is still in the mortgagor and the only interest acquired by the purchaser is the right to receive a conveyance upon complying with the terms of sale if the sale be confirmed. In the latest case dealing with the subject, Mizen v. Thomas, 156 Md. 313, 144 A. 479, 483, the Court of Appeals of Maryland said: "It is true that where, in such a case as this, the trustee reports a sale which in due course is finally ratified, the transaction is spoken of as a sale, and for many purposes it may be treated as a sale, and no mischief is occasioned by that use of the word. Miller's Equity Proc. § 512. But strictly speaking, it is not a sale, for a sale of real estate is not complete or consummate until the property has been actually conveyed, or at least until the purchaser has so far complied with the terms of sale as to entitle him to a conveyance. The bid of the purchaser, its acceptance, the report of the trustee, and its final ratification by the court, are all successive steps in the formation and completion of a perfect and binding contract of sale, but do not amount in themselves to an actual sale. Nor can the property be treated as actually sold until the terms of sale have been met or waived and the purchaser has received or is entitled to receive a conveyance thereof; for until then the title to the property is still in the mortgagor, and the only interest acquired by the purchaser is the right to receive a conveyance of the property upon complying with the terms of sale."
While there are some expressions to the contrary in the opinion in Union Trust Co. v. Biggs, 153 Md. 50, 137 A. 509, that case merely decided that a judgment against the defendant in foreclosure, rendered after the sale but before its confirmation, did not constitute a lien upon the property sold; and it is to be interpreted, in our opinion, as relating the effect of the confirmation to the date of the sale, rather than as changing the well settled rule as to the effect of judicial sales on the rights of the parties prior to confirmation. See Whiteley v. Whiteley, 117 Md. 538, 544, 84 A. 68; Loft, Inc., v. Seymer, 148 Md. 638, 645, 129 A. 911. But at all events, the decision in Mizen v. Thomas, supra, is the latest expression of the Maryland court and we accept it as laying down the rule now in force in that state.
As the bankrupt had not lost his rights in the mortgaged property as a result of the unconfirmed foreclosure sale, we think that *639 the foreclosure proceedings should have been stayed. The statute is highly remedial in character and should be liberally construed. The evident purpose of Congress was to grant to farmer debtors the relief which it prescribes in all cases where an interest in their property remained in them at the time of the filing of petitions under the act. See Paine v. Capitol Freehold & Land Co. (D. C.) 8 F. Supp. 500; In re Lowman (D. C.) 8 F. Supp. 886; In re Cope, 8 F. Supp. 961; In re Miner (D. C.) 9 F. Supp. 1; In re Duffy (D. C.) 9 F. Supp. 166, 169. As said by Judge Lindley in the case last cited: "Viewing the bankruptcy amendment in connection with the remaining sections of the Bankruptcy Act and the recent amendments thereto, it seems to me evident that Congress intended to reach every kind of property interest or property right which the bankrupt then had, including rights to redeem; that Congress intended that the bankrupt should have an opportunity to preserve the then existing status of foreclosure or other insolvency proceedings until it can be determined whether any rehabilitation for the bankrupt is possible. The motive was to prevent completion of immediate foreclosures and execution sales until it should become evident that rehabilitation is impossible. This does not mean that Congress has said that mortgages shall not be enforced. It does not mean that liberty of contracts shall be interfered with or property confiscated, but it does mean that the court, within its jurisdiction and within the limits announced by the Supreme Court in the recent case of Home Building & Loan Association v. Blaisdell, 290 U.S. 398, 54 S. Ct. 231, 78 L. Ed. 413, 88 A. L. R. 1481, will preserve the existing status of property rights of the bankrupt until convinced that no good purpose is being served by so doing."
For the reason stated, we think the learned judge below erred in denying the prayer of the petition for stay of proceedings in the state court. The order appealed from will accordingly be reversed and the case will be remanded for further proceedings not inconsistent with this opinion. As appeal to superintend and revise under section 24b of the Bankruptcy Act, as amended by Act May 27, 1926 (11 USCA § 47 (b) is the proper method of review, the order appealed from will be reversed in No. 3778, and the appeal in No. 3797 will be dismissed.
In No. 3778, reversed.
In No. 3797, appeal dismissed.
NOTES
[*] Judgment reversed on rehearing ___ F.(2d) ___. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2267844/ | 683 F. Supp. 1021 (1988)
UNITED STATES of America, Plaintiff,
v.
ONSLOW COUNTY, et al., Defendants.
No. 87-135-CIV-4.
United States District Court, E.D. North Carolina, New Bern Division.
April 19, 1988.
J. Douglas McCullough, Acting U.S. Atty., Raleigh, N.C., Gerald W. Jones, Steven H. Rosenbaum, Julie A. Riley, Attys., Voting Section Civ. Rights Div., Dept. of Justice, Washington, D.C., for plaintiff.
Michael Crowell, Tharrington, Smith & Hargrove, Raleigh, N.C., for defendants.
Before ERVIN, Circuit Judge, BRITT, Chief District Judge, and DUPREE, Senior District Judge.
ORDER
BRITT, Chief District Judge.
This action was instituted on 30 December 1987 by the United States under the *1022 Voting Rights Act of 1965, as amended, 42 U.S.C. § 1973 seeking injunctive relief with regard to the election of the Board of Commissioners of Onslow County, North Carolina. Defendants are Onslow County, the Onslow County Board of Commissioners and its individual members, and the Onslow County Board of Elections and its individual members. In their answer defendants admit most of the essential allegations of the complaint. The matter is now before the court on motion by plaintiff for summary judgment. It appearing to the court that oral arguments would not aid in the decisional process, the matter will be adjudicated on the record.
FACTUAL BACKGROUND
Onslow County, North Carolina, according to the 1980 census, had a population of 112,784 of whom 22,775 (20.2%) were black. The voting population at that time was 82,560 of whom 16,491 (20%) were black. The Board of Commissioners of Onslow County consists of five members, all of whom, since the passage of the Voting Rights Act, have been white.
On 1 November 1964 the Board of Commissioners served two-year terms and were nominated in partisan primaries from single-member districts and then elected at large by the voters of the entire county. In 1966 the method of nominating candidates for the Board of Commissioners was changed from a single-member district system to an at-large system pursuant to the provisions of a consent decree entered in a lawsuit then pending in this district. Mendelson v. Walton, No. 666 (E.D.N.C. Feb. 23, 1966). In 1969 the General Assembly of North Carolina enacted local legislation increasing the terms of the members of the Board of Commissioners to four years and providing that their terms would be staggered in such a manner that two members would be elected in presidential election years and three in even numbered nonpresidential election years. These changes were implemented in the elections held in 1970 and have been followed since that time.
It was not until 5 May 1987 that Onslow County sought clearance of the above voting changes by submissions to the Attorney General of the United States. On 6 July 1987 the Attorney General responded to the submission interposing an objection to the staggered terms but approving the at-large method of nomination and the four-year terms of office.
CONTENTIONS
The disagreement of the parties, and the reason for this lawsuit, is straightforward, easy to identify and revolves around the relief to which plaintiff is entitled. Plaintiff contends that the court should declare all five seats on the Onslow County Board of Commissioners to be vacant and order an election to be held during 1988 to fill those seats. Defendants, on the other hand, contend that the election in 1988 should be only for those two members of the Board whose term normally expires in 1988 and that the remaining three Board members, who were elected in 1986, should continue in office. At the heart of defendants' contention is the argument that those commissioners who were elected in 1986 were validly elected and that their terms should not be cut short. Defendants also argue that it would be inequitable to set aside the results of the 1986 election because there is no evidence that defendants intentionally delayed seeking clearance for the voting rights changes, that those commissioners elected in 1986 would be required to run new campaigns after only two years and that these same commissioners are the ones who voluntarily submitted the changes for preclearance. At the heart of the contention of the defendants is their assertion that the four-year terms were first implemented in 1970; and, thus, commissioners elected every four years there-after have been properly elected. Hence those elected in 1986, being in a four-year cycle dating from 1970, were properly elected.
Defendants also contend that they are powerless to effect the changes sought by the government inasmuch as the General Assembly of the State of North Carolina *1023 alone has the authority to enact changes in election procedures.
DISCUSSION
There being no genuine issue as to any material fact, disposition of this matter by summary judgment is appropriate. Fed.R. Civ.P. 56(c).
The power and discretion of a district court in an action brought pursuant to Section 5 of the Voting Rights Act is quite limited. McCain v. Lybrand, 465 U.S. 236, 104 S. Ct. 1037, 79 L. Ed. 2d 271 (1984); Canady v. Lumberton City Board of Education, 454 U.S. 957, 102 S. Ct. 494, 70 L. Ed. 2d 373 (1981); Perkins v. Matthews, 400 U.S. 379, 91 S. Ct. 431, 27 L. Ed. 2d 476 (1971); Allen v. State Board of Elections, 393 U.S. 544, 89 S. Ct. 817, 22 L. Ed. 2d 1 (1969). In fact, the Supreme Court has stated that the only questions before the Court are: "(1) whether a change is covered by Section 5; (2) if the change is covered, whether Section 5's approval requirements have been satisfied; and (3) if the requirements have not been satisfied, what relief is appropriate." McCain v. Lybrand, 465 U.S. at 250, n. 17, 104 S. Ct. at 1046, n. 17. In this case there is no dispute that the changes at issue are covered by Section 5 and that approval has not been obtained. Thus, the only proper question which this court may address is that of the appropriate relief. For the reasons that follow, we agree with the government that the seats of all five members of the Board of Commissioners of Onslow County must be declared vacant and a new election held in 1988.
1. All elections held under all of the changes implemented since 1 November 1964 have been conducted in violation of federal law because, at the time they were held, unprecleared voting changes were utilized. See Connor v. Waller, 421 U.S. 656, 95 S. Ct. 2003, 44 L. Ed. 2d 486 (1975). This is true for the 1986 election at which the three members who defendants seek to continue in office were elected.
2. Approval by the Attorney General on 6 July 1987 of the at-large method of nomination and four-year terms of office did not have the effect of validating previously held elections. Since Section 5 requires preclearance of voting rights changes, it is axiomatic that a decision approving such changes has only future application.
3. An election in 1988 for fewer than all five members of the Board would be an election pursuant to the "staggered terms" provision to which the Attorney General has objected. The very nature of the objection by the Attorney General was that staggered term elections deprived black voters of their best opportunity to elect a commissioner of their choice by the use of single-shot voting. If this court were to allow an election this year for only two members, that evil would not be corrected. It is the system of electing commissioners to staggered terms, not the individual offices, that is being challenged.
4. To allow continued implementation of the staggered terms provision would reward inaction on the part of those charged with the duty of seeking preclearance. Section 5 of the Voting Rights Act has now been in effect some twenty-three years. Even though the obligation is placed on the covered jurisdictions to seek preclearance voluntarily before implementing voting changes, most of the impetus for seeking preclearance has come from the Department of Justice or interested individuals and groups of voters. It is likely that many officials in the covered jurisdictions simply were not aware of their obligations. It is also undisputed that many of the "changes" requiring preclearance were only defined by court decisions. Nevertheless, if the desired goals of the legislation are to be obtained, there can be no rewards for delay.
5. The black voters of Onslow County should not be required to wait any longer to exercise their voting rights under a plan which has been approved as provided by the Voting Rights Act of 1965.
Defendants' argument that they are powerless to remedy the violation is completely without merit. This court certainly has the power to order an election in conformity with constitutional and legislative principles. *1024 In addition, as contended by plaintiff, it does not appear that North Carolina law is a barrier. North Carolina General Statute § 163-22.2 (1987) provides:
In the event ... any State election law or form of election of any county board of commissioners ... is unenforceable because of objection interposed by the United States Justice Department under the Voting Rights Act of 1965 and such ruling adversely affects the conduct and holding of any pending primary or election, the State Board of Elections shall have authority to make reasonable interim rules and regulations with respect to the pending primary or election as it deems advisable so long as they do not conflict with any provisions of Chapter 163 of the General Statutes....
The court hereby declares that the staggered term procedure for the election of county commissioners of Onslow County, North Carolina, as provided by Chapters 151 and 167 of the 1969 Session Laws of North Carolina, constitutes a voting change within the meaning of Section 5 of the Voting Rights Act of 1965 to which the Attorney General has interposed a timely objection rendering said procedure legally unenforceable. Accordingly, defendants, their agents, successors in office, and all persons acting in concert with any of them are hereby restrained and enjoined from further implementing the staggered term procedure.
The terms of office of all five members of the Board of County Commissioners of Onslow County, North Carolina, shall terminate on the same date that the offices of those members of said Board elected in 1984 terminate. Defendants are hereby ORDERED to develop and present for Section 5 preclearance a plan for conducting an election in 1988 for the Board of Commissioners of Onslow County, North Carolina, under an election system that removes the objectionable staggered term procedure in compliance with the Voting Rights Act. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564408/ | 76 F.2d 8 (1935)
COMMISSIONER OF INTERNAL REVENUE
v.
PLANT.
No. 247.
Circuit Court of Appeals, Second Circuit.
March 4, 1935.
*9 Frank J. Wideman, Asst. Atty. Gen., and Sewall Key and Helen R. Carloss, Sp. Assts. to Atty. Gen., for petitioner.
George L. Shearer, of New York City, and John A. Kratz, of Washington, D. C., for respondent.
Before MANTON, AUGUSTUS N. HAND, and CHASE, Circuit Judges.
AUGUSTUS N. HAND, Circuit Judge.
In this case a settlor of trusts for the benefit of his wife, son, and adopted son provided that the trustees should maintain a certain estate at Eastern Point, Conn., for the use of his son, Henry Bradley Plant, as long as the latter cared to occupy it, and should charge the income expended in such maintenance against the three trusts proportionately. The question is not whether the income thus expended was taxable at all, for the trustees treated it as taxable to themselves and so returned it, but is whether it constituted income that was properly taxable to the son.
It is to be observed at the outset that the son was not entitled to receive the income expended in maintaining the Eastern Point estate and its furniture, furnishings, greenhouses, and equipment in good condition. Anything expended in maintaining the property may have been as much for the benefit of the capital of the trust, should the son abandon his right to occupy the place and the trustees then sell it, as for his own benefit and enjoyment. The expenditures were compulsory so far as either the trustees or himself were concerned, whether he actually occupied the place for only a day or did not go there at all. The expenditures may well have not been such as he desired, but much greater, and cannot be regarded as made in performance of any legal obligation of the settlor to him.
Section 219 (a) of the Revenue Act of 1924 (26 USCA § 960 note) provides that the tax imposed shall apply to the income of property held in trust. Section 219 (b) (2), 26 USCA § 960 note, provides that in computing the net income of a trust fiduciaries may deduct in their returns "the amount of the income * * * which is to be distributed currently * * * to the beneficiaries, and the amount of the income collected by a guardian of an infant which is to be held or distributed as the court may direct, but the amount so allowed as a deduction shall be included in computing the net income of the beneficiaries whether distributed to them or not."
The question for our consideration is whether the income used in maintaining the estate at Eastern Point was "distributable" income within the meaning of section 219 (b) (2), supra. In spite of the fact that the taxpayer received some benefit from the expenditures at Eastern Point which he might have avoided by abandoning his right to occupy the premises, we do not regard the income thus expended as "distributed" to him as that word is used in the Revenue Act. It is true that "`Distribution,' as there used, does not necessarily mean passing into the uncontrolled possession and disposition of the beneficiary," but it at least "means separation and segregation from the trust estate so that it no longer forms any part * * * thereof." Willcuts v. Ordway, 19 F.(2d) 917, 918 (C. C. A. 8). Here the expenditures were not applied to the use of the taxpayer, but employed in maintaining a capital *10 asset of the trust estate. As the Connecticut Supreme Court said in Hayward v. Hayward, 95 Conn. 122, at page 134, 111 A. 53, 56, when construing this very will:
"The position that the trustees occupy is analogous to that of a landlord under the obligation of maintaining the existing condition of leased property, and that of the son Henry to that of a tenant exempt from the payment of rent, but entitled to have the property conditions preserved by his landlord. The expenses incident to occupancy are to be borne by the latter [son]; those involved in maintenance by the former [trustees]."
The Connecticut Court further said, at pages 135 and 137 of 95 Conn., 111 A. 53, 57:
"The burden of the cost of maintenance is * * * cast upon the income of the trust fund or funds, and forms a charge upon that income, taking precedence of all claims of beneficiaries of income to the extent that its priority exists. * * *
"The testator's net estate, subject to the charge of property maintenance * * * was to pass in beneficial enjoyment to his wife, son, and adopted son in fixed proportions."
It is apparent from the foregoing that the case is like one of a trust under which the trustee is directed to keep a house in repair and allow a beneficiary to live in it rent free. The advantage derived by a beneficiary under such a trust is not taxable as part of his income. Hillman v. Commissioner (C. C. A.) 71 F.(2d) 688; Margaret B. Sparrow, 18 B. T. A. 1, 16, 17.
The decision in Burnet v. Wells, 289 U. S. 670, 53 S. Ct. 761, 77 L. Ed. 1439, is relied on by the Commissioner. Under it the income expended in keeping up the Eastern Point estate is said to be taxable because it represented a benefit to the taxpayer. In that case premiums paid by the trustees of a trust upon insurance on the life of the settlor taken out for the benefit of dependents were held subject to income taxes as property of the grantor. But the income there was derived from property which had been placed in trust by the settlor, and section 219 (h) of the Revenue Acts of 1924 and 1926 (26 USCA § 960 note) expressly subjected such insurance premiums to taxation. The question there was not whether the statute covered the expenditures, but whether it was constitutional. Justice Cardozo, writing for the majority of the court, said that such a provision by a settlor for his dependents was a disposition of income (derived from property which had once been his) in performance of a social obligation, and that the income under such circumstances was to be regarded as devoted to his use. To sustain the constitutionality of an act specifically taxing income derived from trusts established to pay life insurance premiums on policies payable to the settlor's dependents is quite different from holding that income expended to keep up premises in which a beneficiary may live is income "distributed" to the latter. In Burnet v. Wells, the income used to satisfy a moral obligation toward dependents was held taxable against the settlor under the precise terms of the statute. Here the income sought to be attributed to Henry Bradley Plant was in no sense derived from his property, and the use of it in maintaining the Eastern Point property was as beneficial to the trust estate as to him. We think that Burnet v. Wells, 289 U. S. 670, 53 S. Ct. 761, 77 L. Ed. 1439, does not govern the case at bar.
The recent decision of the Court of Appeals of the Eighth Circuit in Willcuts v. Douglas, 73 F.(2d) 130, is also relied on by the Commissioner. There a trust was set up by a husband containing a provision for his wife in lieu of alimony as required by a decree of divorce. The income, though payable to her, was held taxable against the settlor. But in that case the income was derived from property originally belonging to the settlor, and was devoted to the discharge of the latter's legal obligations. The transaction resembled an assignment by a husband to his wife of his future salary or of his interest in future profits of his firm. Lucas v. Earl, 281 U. S. 111, 50 S. Ct. 241, 74 L. Ed. 731; Burnet v. Leininger, 285 U. S. 136, 52 S. Ct. 345, 76 L. Ed. 665. The cases where income devoted to the support and education of a minor is taxed against his guardian [Blair v. Barton (C. C. A.) 26 F.(2d) 765] or where additional compensation paid to an employee in stock or in living quarters is treated as a part of his income are readily distinguishable from the present case where the benefit to the taxpayer, if it existed at all, was somewhat indirect and illusory.
We think that any advantage the taxpayer may have received cannot be regarded as income distributable to him. Its extent *11 is doubtful, and the application of the income beyond the amount necessary to preserve the corpus was as much for the benefit of the capital of the trust as for that of Henry Bradley Plant, who had to suffer expenditures that may have been quite unwelcome to him or else lose the right to occupy the premises at all. In John D. Rogers, Trustee, 16 B. T. A. 368, the Board of Tax Appeals held income employed in similar expenditures taxable against the trustee rather than the beneficiary. We think that ruling was right, and was properly followed by the Board in the present proceeding.
As we have pointed out in discussing Burnet v. Wells, 289 U. S. 670, 53 S. Ct. 761, 77 L. Ed. 1439, the question here is not of the power of Congress, but whether such benefits as the taxpayer received from the maintenance of the estate at Eastern Point ought to be regarded as income distributable to him. In our opinion they were not income thus distributable within the meaning of the statute.
Order affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564514/ | 34 So.3d 484 (2010)
Edward TRENT, Jr.
v.
TRIAD ELECTRIC & CONTROLS, INC.
No. 09-1192.
Court of Appeal of Louisiana, Third Circuit.
April 7, 2010.
*487 Kevin Louis Camel, Cox, Cox, Filo, Camel & Wilson, Lake Charles, LA, for Plaintiff/Appellee, Edward Trent, Jr.
Edward D. Hughes, Taylor, Porter, Brooks & Phillips, L.L.P., Baton Rouge, LA, for Defendant/Appellant, Triad Electric & Controls, Inc.
Court composed of ULYSSES GENE THIBODEAUX, Chief Judge, JIMMIE C. PETERS, and J. DAVID PAINTER, Judges.
THIBODEAUX, Chief Judge.
Appellant, Triad Electric & Controls, Inc. (Triad), asserts that the Office of Workers' Compensation (OWC) was manifestly erroneous by finding that (1) Triad's former employee, Edward Trent, Jr., proved he had a job-related accident, and (2) Trent did not forfeit his workers' compensation benefits (a) because of his false statements regarding prior injuries, and (b) because of his false statements for the purpose of obtaining the benefits. Trent answered Triad's appeal requesting attorney fees and court costs. We affirm the OWC judgment.
*488 I.
ISSUES
We shall consider whether the Workers' Compensation Judge (WCJ) committed manifest errors:
(1) by concluding that the employee had a job-related accident, where the employee alleged that his supervisor witnessed the accident and where the supervisor denied witnessing the accident but acknowledged hearing some noise at the time of the alleged accident;
(2) by holding that the employee did not forfeit his benefits under La. R.S. 23:1208.1, where (a) the employee with limited reading abilities had a previous back injury from which he allegedly recovered; (b) the employee failed to disclose the previous injury on the medical questionnaire; and, (c) the employee's current injury is in the same area as the previous one;
(3) by holding that the employee did not forfeit his benefits under La. R.S. 23:1208 where the employee, when asked about his income, failed to disclose that he earned approximately $100.00 per week selling shrimp; and,
(4) by denying penalties and attorney fees for Triad's discontinuance of indemnity benefits.
II.
FACTS
In 2006, Trent had a work-related accident while working for a previous employer. As a result of that accident, Trent suffered a disc herniation at L5-S1 and a small central disc protrusion at L4-5. His treating physician, Dr. Clark Gunderson, recommended certain treatment that Trent did not undergo until after the current accident. Trent and his previous employer settled Trent's claim for workers' compensation benefits.
After a period of time, Trent returned to work performing manual labor for various employers. He testified that after the 2006 accident, his back pain resolved itself and he did not experience any back problems during his various employments.
Triad hired Trent as an electrician's helper in March of 2008. In connection with this employment, Trent filled out a Medical History Form in which he denied having any previous injuries. The form also contained a notice that a failure to truthfully answer questions on the form may result in forfeiture of workers' compensation benefits.
At the OWC hearing, Trent testified that he dropped out of the seventh grade and that he could not read very well. Thus, he alleged, he copied the answers off the forms filled out by some other applicants. At his deposition, Trent testified he denied having previous injuries on the form because he wanted a job. At the hearing, Trent testified that he was embarrassed to acknowledge his limited reading abilities, and that is why he testified the way he did at the deposition.
Trent stated that on Friday, June 19, 2008, he injured his back when he slipped and fell on the metal steps of the Triad work trailer used as an office. Trent testified that he went to the office to pick up his paycheck and that it rained heavily that day. Trent observed Chris Burnett, a supervisor, standing in the doorway of the office talking to the secretary. Trent alleged that when he stepped on the stairway, he slipped and fell. The secretary and Burnette asked him if he was all right, and Trent responded he thought he was all right and he had come to get his paycheck.
Trent further testified that over the weekend his back started to hurt and that he reported the incident to his employer *489 the following week. The doctor to whom Triad sent Trent after the accident released Trent to light-duty work. Trent claims that because he could not perform the light-duty work to which he was assigned, he consulted Dr. Gunderson who placed him on a "no-duty" status on July 11, 2008.
Dr. Gunderson requested an MRI. It revealed disc protrusions at the same sites as the 2006 injuries but on a larger scale. Trent underwent physical therapy and epidural steroid injections. As the steroid injections did not relieve Trent's conditions, Dr. Gunderson recommended surgery.
At his deposition, Dr. Gunderson testified that it was possible that Trent would have suffered the 2008 injury in the absence of the 2006 injury. Dr. Gunderson believed that the 2008 injury aggravated the 2006 injury. Yet, he also testified that he would not have considered Trent disabled immediately prior to the accident if he knew that Trent performed heavy duty manual labor for a year and a half between the accidents. In his report, Dr. Gunderson wrote that "[b]ecause of the two year history of being able to work," he believed that Trent's "complaints are related to the injury of June 19, 2008." In another report, Dr. Gunderson wrote that Trent "apparently has had a complete recovery" from the 2006 injury.
The insurance adjuster testified that Trent was receiving workers' compensation benefits for this accident from July until October of 2008 in the amount of $515.67 per week. The adjuster acknowledged that the correct amount of the benefit should have been, as the parties stipulated, $522.00. She offered no explanation for the underpayment.
The adjuster terminated the benefits when she learned that Trent injured the same region of his spine in 2006 as in 2008, that Dr. Gunderson recommended the same treatment in 2006 as he recommended in 2008, that Trent never underwent the treatment before the 2008 injury, and that he denied having the injury on the medical questionnaire.
The OWC held that Trent proved he had a work-related accident. Because of Trent's limited reading abilities, his embarrassment of this fact, and Triad's inability to establish that the 2008 injury was inevitable and merged with the 2006 injury, the OWC found that Trent did not forfeit his benefits under La. R.S. 23:1208.1.
Triad claims that the OWC erred by concluding that Trent sustained his burden of proving the accident occurrence and by concluding that Triad did not sustain its burden of proving its defense under La. R.S. 23:1208 and 23:1208.1. In his reply brief, Trent asserted that the trial court erred by not awarding him penalties and attorney fees for the underpayment of his benefits. Trent answered the appeal requesting this court to affirm the OWC's judgment and to award him attorney fees for the work on appeal and court costs for the trial and appellate proceedings.
III.
STANDARD OF REVIEW
The WCJ's findings of fact are reviewed under the "manifest error" or "clearly wrong" standard. Jim Walter Homes, Inc. v. Guilbeau, 05-1473 (La.App. 3 Cir. 6/21/06), 934 So.2d 239. Appellate courts do not disturb the WCJ's findings of fact as long as they are reasonable and supported by the record. Id.
The WCJ's determination as to whether or not a claimant willfully made a false statement to obtain workers' compensation benefits and causation issues are *490 findings of fact. Id.; Hunter v. Alliance Compressors, 06-100 (La.App. 3 Cir. 6/21/06), 934 So.2d 225. The WCJ's imposition of penalties and attorney fees upon an employer is also a finding of fact subject to the manifest error standard. Guilbeau, 934 So.2d 239.
This court reviews WCJ's credibility determinations for manifest error. See Butterfield v. Turner Indus., 06-1098 (La.App. 3 Cir. 2/7/07), 951 So.2d 476, writ denied, 07-507 (La.4/27/07), 955 So.2d 692. We find manifest error in credibility determinations only when the "objective evidence so contradicts an employee's testimony, or testimony is so internally inconsistent or implausible on its face that a reasonable factfinder would discredit the story." Id. at 480 (quoting Hubbard v. Allied Bldg. Stores, Inc., 41,534, p. 5 (La.App. 2 Cir. 11/1/06), 942 So.2d 639, 643).
IV.
LAW AND DISCUSSION
(1) Occurrence of a Work-Related Accident
An employee may prove by the employee's testimony alone that an unwitnessed accident in the course and scope of her or his employment occurred if: "(1) no other evidence discredits or casts serious doubt upon the worker's version of the incident; and (2) the worker's testimony is corroborated by the circumstances following the alleged incident." Butterfield, 951 So.2d at 479 (quoting Bruno v. Harbert Int'l Inc., 593 So.2d 357, 361 (La.1992)). The worker's friends, co-workers, spouse, as well as the worker's medical records, may corroborate the worker's testimony. Lollis v. Shaw Global Energy Servs., 07-395 (La.App. 3 Cir. 10/3/07), 966 So.2d 1118.
The determination as to whether an accident occurred involves a judgment of credibility to which an appellate court gives great deference on review. Francis v. BFI, 01-769 (La.App. 3 Cir. 12/12/01), 801 So.2d 604, writ denied, 02-101 (La.3/22/02), 811 So.2d 934. Generally, the surrounding circumstances of the case indicate what effect a court should give to the length of time a worker takes to report an accident. See Ardoin v. Firestone Polymers, L.L.C., 09-530 (La.App. 3 Cir. 12/30/09), 30 So.3d 177; Trahan v. Turner Indus., Inc., 08-704 (La.App. 3 Cir. 12/10/08), 999 So.2d 268. Thus, that a worker did not immediately report an accident does not necessarily cast a serious doubt on the worker's testimony. See Id.
Here, Triad argues that the testimony of Burnette discredits or casts a serious doubt on Trent's testimony because Trent claims that Burnette witnessed the accident and Burnette testified that he never did. Furthermore, Triad asserts that Trent's failure to immediately report the accident casts a serious doubt on the accident's occurrence. Finally, Triad claims that Trent's testimony was not credible because he lied about making money after being injured, about his ability to lift heavy objects, and about his previous back injury.
We find that the trial court did not manifestly err by concluding that Trent satisfied his burden of proof. Contrary to Triad's assertions, Burnette's testimony supports Trent's account of the accident. Although Burnette testified that he did not witness the fall, he testified that he heard the noise on the stairs at the time Trent claims to have had the accident. The nature of that noise even prompted Burnette's inquiry as to whether Trent was all right.
Moreover, based on the circumstances of this case, it was not unreasonable for the *491 WCJ to rely on Trent's explanation that he thought Brunette actually witnessed the accident, and, therefore, he did not think that the immediate report was necessary. Additionally, the accident happened on a Friday just before Trent was going home, and he thought that he was not hurt. Trent reported the accident when he returned to work the next week. His wife's testimony and his medical records also corroborate his account of the accident.
Finally, Trent's alleged lying regarding his income, ability to lift heavy objects, and his previous back injury was not enough to cast a serious doubt on his claims. The WCJ listened to all of this evidence and Trent's explanations of it. Trent testified that he thought he was being asked about employment and not about side jobs, like selling shrimp, when he was asked about his income. He also explained that he had good and bad days when it came to bending and lifting. Finally, he stated that he denied having prior back injury on the form because he just copied the answers of the other applicants. He explained that he copied the answers because he did not read well.
We do not find that Trent's testimony was implausible on its face or that objective evidence so contradicted his testimony that a reasonable factfinder would have discredited the story. Therefore, we find no error in the OWC's ruling that the accident occurred.
(2) Forfeiture Defense Under La. R.S. 23:1208.1
An employer may inquire about an employee's "previous injuries, disabilities, or other medical conditions." La. R.S. 23:1208.1. If the employee fails to answer truthfully, the employee forfeits workers' compensation benefits, "provided said failure to answer directly relates to the medical condition for which a claim for benefits is made or affects the employer's ability to receive reimbursement from the second injury fund." Id. Thus, La. R.S. 23:1208.1 creates an affirmative defense of forfeiture for the employer from whom an employee seeks workers' compensation benefits. Wise v. J.E. Merit Constructors, Inc., 97-684 (La.1/21/98), 707 So.2d 1214. Because forfeiture is a very harsh remedy, the statute must be strictly construed. Nabors Drilling USA v. Davis, 03-136 (La.10/21/03), 857 So.2d 407.
The statute's enforceability is subject to certain notice requirements. La. R.S. 23:1208.1. That Triad complied with the notice requirements of the statute has not been disputed. Yet, we note that Trent may not have had the actual notice because of his limited reading skills.
We shall focus on whether the OWC erred by finding that Triad did not carry its burden of proof with respect to the other two elements of its forfeiture defense: the untruthful statement and the prejudice to its ability to receive reimbursement.
(a) The Untruthful Statement
To satisfy the requirements of the forfeiture defense under La. R.S. 23:1208.1, it is not enough for the employer to demonstrate that the employee made a false statement about her or his medical condition. The employer must show that the employee had an intent to deceive the employer. Hickman v. Jim Smith Logging, 04-157 (La.App. 3 Cir. 9/29/04), 883 So.2d 1072, writ denied, 04-2682 (La.1/14/05), 889 So.2d 269.
For example, where an employee's girlfriend, who did not know about the employee's prior work injury, filled out the medical questionnaire answering questions about prior injuries in the negative, and the employee only signed the form, this court found that the employer did not sustain its burden of proving this element of its forfeiture defense. Id.
Here, the OWC found that Trent did not intentionally deny having a prior injury. *492 Trent testified that because of his limited education, his reading skills were not well developed. For this reason, he copied answers on the form from the forms filled out by other applicants without reading or understanding the questions. Triad attempted to impeach this explanation with Trent's deposition testimony in which he stated that he denied having a prior injury because he wanted the job. Trent further explained that he was embarrassed to admit he had limited reading skills and that is why he answered the way he did during the deposition.
The WCJ found Trent's explanations reasonable and persuasive. This court does not find that the OWC erred in this credibility determination. Based on these considerations, we conclude that Triad failed to prove this element of its La. R.S. 23:1208.1 forfeiture defense.
(b) The Prejudice to the Employer
An employer may establish prejudice (1) by proving that the employee's untruthful statement relates directly to the medical condition for which the employee claims benefits, or (2) by proving that the untruthful statement affected the employer's entitlement to reimbursement from the second injury fund. Hickman, 883 So.2d 1072 (citing Davis, 857 So.2d 407). Under the first prong, it is not enough for the employer to show that the previous injury and the current injury were to the exact same area. Wise, 707 So.2d 1214. Instead, a direct relation between the untruthful statement and the injury exists "when the subsequent injury was inevitable or very likely to occur because of the presence of the preexisting condition." Id. at 1220.
For example, where an employee had a pre-existing traumatic arthritis in his knee, which was completely asymptomatic for two or three years during which the employee worked as a laborer, and the employee slipped and, as a result, experienced a meniscus tear in the same knee, the supreme court concluded that the employer failed to satisfy the inevitability test. Id.
Here, Triad faces the same problem. Although Trent's current back injury is in the same area as his previous injury, that is not enough to satisfy the inevitability test. Like the employee with a pre-existing knee arthritis who was asymptomatic for years while working as a laborer, Trent's back symptoms resolved themselves, and he was able to perform heavy labor for one and a half to two years between his injuries without any back complaints and without seeking any medical treatment. Moreover, in both cases the employees' second injuries resulted not from performing their ordinary job duties but from accidental slips. Finally, the treating physician's testimony that Trent's current injury could have been an aggravation of his old condition or that it could have occurred in the absence of the old one does not establish inevitability or exceptional likelihood of the second injury.
Under the alternative prong, the employer must show prejudice to its ability to collect from the second injury fund. To establish entitlement to reimbursement from the fund, the employer must prove three elements: (1) that the employee suffered from a permanent partial disability that was so serious as to hinder employment; (2) that the employer actually knew of this disability prior to the current injury; and, (3) that the disability merged with the current injury to produce a greater disability. Wise, 707 So.2d 1214. To aid the employer's collection of reimbursement from the second injury fund, our legislature established "a presumption that the employer considered the condition to be permanent and to be or likely to be a hindrance or obstacle to employment" where the condition was one *493 of the thirty listed in the statute. La. R.S. 23:1378(F). One of these conditions is a ruptured intervertebral disc. Id.
"A `presumption' is an inference created by legislation that the trier of fact must draw if it finds the existence of the predicate fact unless the trier of fact is persuaded by evidence of the nonexistence of the fact to be inferred." La.Code Evid. art. 302(3) (emphasis added). In civil cases, unless a "more specific legislation provides otherwise," presumptions, as used in legislation, are rebuttable "and therefore may be controverted or overcome by appropriate evidence." La.Code Evid. arts. 301, 304.
Here, Triad failed to establish both, that Trent suffered from permanent partial disability that hindered his employment and that his alleged disability merged with the current injury to produce a greater disability. Dr. Gunderson testified that in 2006, Trent's MRI showed that "there was probably what would be considered a small herniation at L5-S1." Thus, Triad established a predicate fact, the diagnosis of a disc herniation. Yet, Trent supplied enough evidence to convince the OWC of the nonexistence of the fact to be inferred, i.e., that Trent suffered from a permanent partial disability at the time Triad hired him: (1) Trent and his wife testified that he had no back problems after the 2006 injury resolved itself; (2) without any back complaints, Trent worked at several jobs that involved heavy manual labor prior to working for Triad; (3) there are no medical records showing that Trent sought or received medical care for any back problems between the injuries; (4) Trent was able to perform his work duties at Triad and was injured not while in the performance of his duties but because of a slip and fall; (5) Dr. Gunderson testified that if Trent was able to work as a laborer for two years prior to the accident, Dr. Gunderson would not have concluded that Trent suffered from a partial disability immediately before the accident; and, (6) Dr. Gunderson wrote that Trent "has previously known disc pathology," but that it was Dr. Gunderson's impression that Trent "apparently has had a complete recovery" from the 2006 injury. Based on this, we find that the OWC did not err by concluding that Triad failed to establish that Trent suffered from permanent partial disability immediately before the 2008 accident.
Triad also failed to establish merger of the 2006 and the 2008 injuries so as to produce a greater disability. As mentioned previously in this opinion, Dr. Gunderson testified that Trent's current injury could have been an aggravation of his old condition or that it could have occurred in the absence of the old. Based on this testimony, this court cannot conclude that the OWC manifestly erred by finding that Triad did not sustain its burden of proving that Trent's previous injury merged with the current injury to produce a greater injury.
(3) Forfeiture Defense Under La. R.S. 23:1208
It is unlawful "for any person, for the purpose of obtaining or defeating any benefit or payment under the provisions of this Chapter, either for himself or for any other person, to willfully make a false statement or representation." La. R.S. 23:1208(A). "Any employee violating this Section shall, upon determination by workers' compensation judge, forfeit any right to compensation benefits under this Chapter." La. R.S. 23:1208(E). Thus, the employee forfeits workers' compensation benefits if the employer proves that (1) that the employee made a false statement or representation, (2) willfully, (3) for the purpose of obtaining or defeating any benefit or payment. Resweber v. Haroil Constr. Co., 94-2708 (La.9/5/95), 660 So.2d 7.
*494 Here, Triad argues that Trent intentionally concealed his income from shrimp sales with an intent to obtain additional workers' compensation benefits. With support of a surveillance video, Triad also claims that Trent intentionally exaggerated the extent of his injuries.
At the hearing, Trent explained that he did not mention the income from his shrimp selling because he thought that when the counsel inquired about his income, he meant income from an actual employment and not a side job. Thus, Trent's failure to disclose this income appears to have been a misunderstanding and not a willfully false statement.
Trent also explained that on some days his back hurts less than on other days and that is why his level of activities varies from day to day. We note that for this reason, video surveillance that is subject to recording at times most favorable to the person making the recording is inherently of limited value. Based on these considerations, we find no manifest errors here.
(4) Penalties and Attorney Fees
The workers' compensation judge concluded that "[g]iven the factual disputes at issue and the defense presented," attorney fees and penalties were not owed. We agree. The record evidence demonstrates that this factual determination is not manifestly erroneous.
V.
CONCLUSION
The judgment in favor of Edward Trent, Jr. is affirmed.
AFFIRMED.
PETERS and PAINTER, JJ., concur in the result. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1833260/ | 569 N.W.2d 169 (1997)
STATE of Minnesota, Respondent,
v.
Wayne Thomas CARTER, petitioner, Appellant.
No. CX-95-1368.
Supreme Court of Minnesota.
September 11, 1997.
*171 Scott Swanson, Assistant State Public Defender, Minneapolis, for Appellant.
Hubert H. Humphrey III, Attorney General, St. Paul, James C. Backstrom, Dakota County Attorney by Phillip D. Prokopowicz, Assistant Dakota County Attorney, Hastings, for Respondent.
Heard, considered and decided by the court en banc.
OPINION
TOMLJANOVICH, Justice.
By looking through the gaps in the closed blinds covering a window, a police officer observed the appellant, Wayne Thomas Carter, as he engaged in a drug-packaging operation with two other persons, one of whom was the leaseholder of the apartment. The district court held that Carter, who was an out-of-state visitor, did not present any evidence to establish his standing to contest the legality of the observation. The court also concluded that the officer did not conduct a search because he made the observations from an area where Carter did not have a reasonable expectation of privacy. The court of appeals affirmed the district court, but based its holding only on the finding that Carter did not have standing to bring a motion to suppress any evidence obtained from the officer's observations. We reverse, and hold that the evidence was sufficient to establish that Carter had standing to challenge the legality of the observation. We further hold that the officer's observation rose to the level of a search, and that the officer's lack of probable cause and a warrant rendered the search unreasonable under the Fourth Amendment of the United States Constitution, and Article I, Section 10 of the Minnesota Constitution.
At approximately 8 p.m. on the evening of May 15, 1994, an anonymous informant approached Eagan police officer Jim Thielen. The informant, whom Thielen never had seen *172 before, told Thielen that he/she[1] had walked by apartment 103 at 3943 South Valley View Drive and observed people sitting around a table inside the apartment "bagging" a white powder. The informant also told Thielen that he/she believed the occupants of the apartment had used a blue four-door Cadillac located in the parking lot adjacent to the apartment complex. The informant also told Thielen that the car had an Illinois license plate that read SGD 896. In response to this information, Thielen went to the complex and approached the ground floor window of apartment 103. Thielen then walked toward the window of the apartment by leaving the common sidewalk that led to the apartment building's entrance and stepping on a grassy common area closer to the window. Thielen then walked behind some short bushes located in front of the apartment window and stood approximately 12 to 18 inches from the window. The window's blinds were drawn closed, but gaps in the blinds allowed Thielen to observe activity in the apartment. While looking through the gaps in the blinds, Thielen observed two males and one female sitting at a kitchen table. One of the males appeared to be placing a white powdery substance onto the kitchen table. This person then would pass the white substance to the second male who then would place the powder into a plastic bag. The second male, who was wearing bedroom slippers, would in turn give the plastic bag to the female who would cut off the ends of the bag and place it on the table.
After observing this activity for approximately 15 minutes, Thielen left the apartment complex and went to a nearby fire station where he had another conversation with the informant and another Eagan police officer. At this time the informant told the officers that the people inside the apartment might be in possession of a gun. Thielen then returned to the apartment complex where he located a Cadillac matching the description given by the informant. He then returned to the fire station, telephoned Officer Kevin Kallestad of the South Metro Drug Task Force, and reported what he had seen. Kallestad instructed Thielen to stop and secure the suspect vehicle should anyone attempt to drive it away. Police also began to prepare affidavits as part of a request for warrants to search both the apartment and the Cadillac.
At approximately 10:30 p.m., an Eagan police officer observed two males putting items into the suspect Cadillac. The two males then entered the vehicle and started to drive it out of the parking lot. As per instructions, Eagan police stopped the vehicle at the intersection of Rahn Road and Beau de Rue Drive. The police found Carter in the driver's seat and Melvin Johns in the passenger's seat. The police ordered both men out of the car. As the police opened the door to let Johns out of the car, they observed a black zippered pouch and a handgun, later determined to be loaded, on the floor of the vehicle. The police then placed Carter and Johns under arrest. The police subsequently towed the Cadillac to the Eagan Police Department, and after receiving the signed search warrant at approximately 1:30 a.m. on May 16, the police searched the vehicle. When the officers opened the black zippered pouch, they discovered a white mixture in plastic baggies, Johns' identification, pagers, and a scale. Tests later determined that the white mixture was 47.1 grams of cocaine.
Late in the evening of May 15, after the arrests of Carter and Johns, Eagan police returned to apartment 103 and arrested its occupant, Kimberly Thompson.[2] At approximately 3 a.m. on May 16, police executed a search warrant on the apartment and located cocaine residue on the kitchen table and plastic baggies consistent with those found in the automobile driven by Carter. Thielen subsequently identified Carter, Johns and Thompson as the individuals he had observed in the apartment packaging the white mixture. He *173 identified Carter as the individual he had seen putting the white mixture on the table and dividing it into piles, Johns as the man who wore slippers and placed the piles into baggies, and Thompson as the individual who cut the ends off the baggies and placed the baggies in piles. Police ultimately learned that Carter and Johns were residents of Chicago, Illinois, and that Thompson was the sole lessee of apartment 103. Subsequent to his arrest, Carter made a statement to the police in which he admitted ownership of a duffel bag found inside the Cadillac. A search of the duffel bag uncovered a digital gram scale containing traces and residue of cocaine. Johns made a statement to the police admitting he had accepted a proposal to transport cocaine from Illinois to Minnesota for money, and that he, Carter and Thompson had packaged the cocaine at Thompson's apartment. He also admitted that there were approximately two ounces of crack cocaine and a handgun in the vehicle.
Carter, Johns and Thompson made motions through joint counsel to suppress their statements and all evidence seized from both the apartment and the Cadillac. They argued, among other things, that Thielen's initial observation through the window of Thompson's apartment was an unreasonable search under the Fourth Amendment and that all evidence obtained as a result of those observations should be excluded as fruit of the poisonous tree. After a two-day omnibus hearing, the district court denied the motions to suppress of Carter and Johns. The court held that the two defendants did not have standing to challenge Thielen's observations through Thompson's window because both defendants failed to present evidence that their expectations of privacy in the apartment were based upon "understandings that are recognized and permitted by society." See Rakas v. Illinois, 439 U.S. 128, 143-44 n. 12, 99 S. Ct. 421, 430 n. 12, 58 L. Ed. 2d 387 (1978); see also Minnesota v. Olson, 495 U.S. 91, 110 S. Ct. 1684, 109 L. Ed. 2d 85 (1990). In particular, the court noted that the only evidence presented by the defense showed that the two defendants were out-of-state residents who had been at the apartment for a period of time on May 15, 1994. The district court also concluded that Thielen's observation was not a search within the meaning of the Fourth Amendment because the officer made his observation from an area in which the defendants had no reasonable expectation of privacy.
Following the district court's denial of their motions to suppress, Carter and Johns proceeded with separate counsel. The district court tried Carter on stipulated facts and found him guilty of conspiracy to commit a controlled-substance crime in the first degree and aiding and abetting a controlled-substance crime in the first degree. Minn. Stat. § 152.021, subd. 1(1), subd. 3(a) (1996); Minn.Stat. § 609.05 (1996). The district court denied Carter's request for a downward departure and sentenced him to 86 months. Carter appealed his conviction, challenging the legality of Thielen's observations through Thompson's apartment window. The court of appeals held that Carter did not have standing to object to Thielen's actions because Carter's claim that he was predominantly a social guest was "inconsistent with the only evidence concerning his stay in the apartment, which indicates that he used it for a business purpose to package drugs." State v. Carter, 545 N.W.2d 695, 698 (Minn.App.1996).
We therefore begin our analysis by addressing the question of standing, and only if we determine that Carter had standing to bring a motion to suppress evidence recovered as a result of Thielen's observation of the apartment, will we address the legality of Thielen's actions whether his observation qualified as a search, and if it did, whether it was reasonable.
I. Standing
Because the facts of this case are not in dispute, we will review de novo the district court's denial of Carter's motion to suppress. State v. Othoudt, 482 N.W.2d 218, 221 (Minn.1992). Before a criminal defendant can bring a motion to suppress evidence on the basis that it was obtained in violation of the Fourth Amendment, the defendant must show that he or she is a proper party to assert the claim of illegality and to seek the remedy of exclusion. To establish such a showing, a party must demonstrate two *174 things: First, that he or she has an adversary interest in the outcome. Baker v. Carr, 369 U.S. 186, 204, 82 S. Ct. 691, 702, 7 L. Ed. 2d 663 (1962). And second, that the adverse interest is based upon an alleged violation of the rights of the individual, rather than the violation of the rights of some third party. Jones v. United States, 362 U.S. 257, 261, 80 S. Ct. 725, 731, 4 L. Ed. 2d 697 (1960)(overruled on other grounds).[3] As far as the first factor is concerned, a criminal defendant against whom the allegedly illegally obtained evidence is being offered surely qualifies as one who has an adversary interest. See 5 Wayne R. LaFave, Search and Seizure § 11.3, at 117 (3d ed.1996) (hereinafter LaFave). Consequently we hold that Carter had an adversarial interest in the outcome. The analysis of the second factor is not so easily decided, however. As the United States Supreme Court has told us, the question turns on a "determination of whether the disputed search * * * has infringed an interest of the defendant which the Fourth Amendment was designed to protect." Rakas, 439 U.S. at 140, 99 S.Ct. at 429. Such an interest exists when "the person who claims the protection of the Amendment has a legitimate expectation of privacy in the invaded place." Id. at 143, 99 S.Ct. at 430. The question before us, therefore, is whether Carter had a legitimate expectation of privacy in Thompson's apartment.[4]
A defendant has a legitimate expectation of privacy when his or her subjective expectation of privacy is "one that society is prepared to recognize as `reasonable.'" Id. at 143-44 n. 12, 99 S.Ct. at 430 n. 12 (quoting Katz v. United States, 389 U.S. 347, 361, 88 S. Ct. 507, 516, 19 L. Ed. 2d 576 (1967)(Harlan, J., concurring)). In other words, a criminal defendant must make two showings to establish that he or she based the motion to suppress upon an alleged violation of his or her individual Fourth Amendment right. First, he or she must show a subjective expectation of privacy, and second, he or she must show that this expectation was reasonable in light of "longstanding social customs that serve functions recognized as valuable by society." Olson, 495 U.S. at 98, 110 S.Ct. at 1689.
In the case at bar, it is clear that Carter had a subjective expectation of privacy. He was inside the apartment of an acquaintance with the doors shut and the blinds drawn. The more difficult question is whether Carter's expectation was legitimate, that is, whether the expectation was the type that society is prepared to recognize as reasonable. Both the district court and court of appeals concluded that Carter failed to establish that his subjective expectation was legitimate. The district court based its conclusion on the fact that Carter offered no evidence that his status in relation to the apartment was similar to the status of the defendant in Olson, or that his status was such that it provided a legitimate expectation of privacy in the apartment. Likewise, the court of appeals based its conclusion on the fact that Carter's claim that he was a social guest was inconsistent with the "only evidence concerning his stay in the apartment, which indicates that he used it for a business purpose * * *." Carter, 545 N.W.2d at 698. In both cases, the courts focused on the facts of Olson, a case in which there was no dispute that the criminal defendant was an overnight guest of the person who had the possessory interest of the searched residence.[5] By comparison, *175 it is undisputed that Carter failed to produce any evidence that he was a "guest" of Thompson's, let alone an "overnight guest." But a closer reading of Olson reveals that the Supreme Court does not require a person to establish his or her status as either a guest or overnight guest before that person can prove a legitimate expectation of privacy in a location that is searched. Instead, the person must establish only that under the totality of the circumstances, the person's subjective expectation was the type of expectation that "society is prepared to recognize as `reasonable.'"
Admittedly, such a test is a difficult one to define, let alone apply. But the Supreme Court's own words offer guidance. "To hold that an overnight guest has a legitimate expectation of privacy in his host's home merely recognizes the everyday expectations that we all share. Staying overnight in another's home is a longstanding social custom that serves functions recognized as valuable by society." Olson, 495 U.S. at 98, 110 S.Ct. at 1689. In other words, the Court in Olson did not recognize the expectation of privacy as legitimate merely because the criminal defendant was a guest. See 5 LaFave, supra, § 11.3(b), at 137 (stating that the Court's decision lends "considerable support to the claim that shorter term guests also have standing").[6] Rather, it recognized the defendant's expectation of privacy as legitimate because the criminal defendant's status as a guest was the type of longstanding social custom that serves functions recognized as valuable by society. As the Court went on to state: "The point is that hosts will more likely than not respect the privacy interest of their guests, who are entitled to a legitimate expectation of privacy despite the fact that they have no legal interest in the premises and do not have the legal authority to determine who may or may not enter the household." Olson, 495 U.S. at 99, 110 S.Ct. at 1689. Consequently, if Carter had established that his status is the type that serves functions recognized as valuable by society, his expectation of privacy would have been legitimate.
The stipulated facts show that the apartment's leaseholder allowed Carter and Johns into her apartment for the purpose of packaging cocaine in exchange for one-eighth ounce of cocaine; that Thielen observed all three persons inside the apartment as they collaborated to divide and package the cocaine; that Carter and Johns remained inside the apartment for at least 2 1/2 hours, and that Johns was wearing bedroom slippers while inside the apartment.[7] Although *176 we recognize that these facts probably fail to establish Carter as a "guest" of the apartment's leaseholder, we conclude that they were sufficient to prove that Carter was the type of person who possessed a legitimate expectation of privacy in the apartment. After all, Carter had the leaseholder's permission to be inside the apartment.[8] He remained inside the apartment for at least 2 1/2 hours, during which time he worked in concert with the leaseholder on a common task.[9] Whether these facts establish Carter as a visitor, invitee or business partner does not matter. As the Court has carefully noted, arcane distinctions developed in property and tort law between guests, licensees, invitees, and the like do not control. Jones, 362 U.S. at 266, 80 S.Ct. at 734. What does control, however, is the nature of the relationship between the property possessor and the person alleging the privacy interest in the property. If the relationship is the type that society recognizes as valuable, then we will find standing. If it is not, then we will not. Although society does not recognize as valuable the task of bagging cocaine, we conclude that society does recognize as valuable the right of property owners or leaseholders to invite persons into the privacy of their homes to conduct a common task, be it legal or illegal activity. We, therefore, hold that Carter had standing to bring his motion to suppress the evidence gathered as a result of Thielen's observations.
II. The Search
Having determined that Carter had standing to assert a violation of the Fourth Amendment, we now turn to the question of whether Thielen's observation constituted a search. A search occurs whenever government agents intrude upon an area where a person has a reasonable expectation of privacy. California v. Ciraolo, 476 U.S. 207, 211, 106 S. Ct. 1809, 1811, 90 L. Ed. 2d 210 (1986) (citing Katz, 389 U.S. at 360, 88 S.Ct. at 516 (Harlan, J. concurring)). The state argues Thielen's observations did not rise to the level of a search because he was not inside the leaseholder's "curtilage" when he made his observation. As support for its argument, the state offers State v. Krech, 403 N.W.2d 634 (Minn.1987) for the proposition that the common grounds of multi-unit apartment complexes are not entitled to Fourth Amendment protection. In Krech, we stated:
"it is a fair generalization that the lands adjoining a multiple-occupancy residence are less likely to receive Fourth Amendment protection than the yard of a single family residence" because "the privacy expectation as to such an area is often diminished because it is not subject to the exclusive control of one tenant and is utilized by tenants generally and the numerous visitors attracted to a multiple occupancy building."
403 N.W.2d at 637 (quoting 1 Wayne R. LaFave, Search and Seizure § 2.3(f), at 414 (2d ed.1987)). The state's argument misses the point of Krech, however.
In developing the concept of "curtilage," the Supreme Court actually extended *177 Fourth Amendment protection to those areas so intimately tied to the home itself that an individual reasonably could have expected persons to treat those areas as part of the home. United States v. Dunn, 480 U.S. 294, 300, 107 S. Ct. 1134, 1139, 94 L. Ed. 2d 326 (1987). The curtilage cases, therefore, necessarily involve factual scenarios in which police search areas spatially removed from the home itself. See, e.g., Dunn, 480 U.S. at 297, 107 S.Ct. at 1137 (agents entered area surrounding barns, 50 feet from house); Krech, 403 N.W.2d at 637-38 (police entered yard of duplex where garbage cans were kept). The key question in a curtilage case is not where the police officer was standing when he made his observation, although police officers must establish that they had a legal right to be where they were at the time of the observation, rather it is the area that was observed. Although it is plausible that Thielen's presence just outside the apartment window was legitimate,[10] the state cannot rely on Thielen's position alone to justify his subsequent observation into the apartment. The fact that a police officer was situated outside a residence's curtilage does not necessarily eliminate the occupant's expectation of privacy within the interior of the dwelling. 1 LaFave, supra, § 2.3(d), at 495-96.
The fundamental question under Katz is whether the looking intruded upon the justified expectation of privacy of the occupant. This, in turn, ordinarily requires consideration of two factors: (1) the location of the officer at the time of the viewing; and (2) the precise manner in which the view was achieved.
Id. at 497.
This, of course, does not mean that all instances in which a police officer looks into a house or apartment will be a search under the Fourth Amendment. "What a person knowingly exposes to the public, even in his own home or office, is not subject to Fourth Amendment protection." Katz, 389 U.S. at 351, 88 S.Ct. at 511. We, therefore, have held that police did not violate a homeowner's expectation of privacy by walking onto the homeowner's driveway and observing stolen property that was in plain sight from the driveway. State v. Crea, 305 Minn. 342, 346, 233 N.W.2d 736, 739 (1975). Other courts similarly have found no Fourth Amendment protection for activities that are easily observable by the general public.[11]
People who close their doors and window blinds, however, do not knowingly expose their activities to the public. Consequently, we conclude that Carter, Johns, and Thompson took sufficient precautions to keep their activities private. It was only after Thielen left the sidewalk, walked across the grass, climbed over some bushes, crouched down and placed his face 12 to 18 inches from the window that their activities became observable. As one noted commentator has stated:
[W]hen police surveillance takes place at a position which cannot be called a "public vantage point," i.e., when the police though not trespassing on the defendant's curtilage resort to the extraordinary step of positioning themselves where neither neighbors nor the general public would be expected to be, the observation or overhearing of what is occurring within a dwelling constitutes a Fourth Amendment search. This is really what Katz is all about.
1 LaFave, supra, § 2.3(d), at 482. Several courts have agreed that it is a search whenever police take extraordinary measures to enable themselves to view the inside of a *178 private structure.[12] The question before us, therefore, is whether Thielen took extraordinary measures to enable him to view the inside of the apartment. Although it is a close question whether Thielen's location at the time of his observation was legitimate, the totality of his acts makes such a determination unnecessary. For even if we concluded that the area just outside the apartment window was a common area, the fact that Thielen left the sidewalk, walked across the grass, climbed over the bushes, placed his face within 12 to 18 inches of the window and peered through a small gap between the blinds makes it clear that he took extraordinary measures to enable himself to view the inside of a private dwelling. If we conclude that his actions constituted anything other than a search, it is difficult to imagine when we would be able to say that any activity short of an actual physical intrusion of a dwelling would violate a person's expectation of privacy. We therefore hold that Thielen's conduct constituted a search under the Fourth Amendment.[13]
III. Reasonableness of the Search
The Fourth Amendment protects persons from, among other things, unreasonable searches. U.S. const., amend. IV. In order for a search to be reasonable, the police must have both probable cause and a search warrant. Id.; In re Welfare of G. (NMN) M., 560 N.W.2d 687, 692 (Minn.1997). In the case at bar, the state conceded that, prior to his observations through Thompson's window, Thielen did not have probable cause to obtain a search warrant. The facts also show that Thielen did not have a search warrant at the time of the observation. Despite these facts, the state now asserts that Thielen's search was reasonable because he had a reasonable basis for believing the occupants of Thompson's apartment were engaged in drug activity and because his search was minimally intrusive.[14] As the Supreme Court made clear in Katz, however, conduct that would constitute an illegal search does not become something less merely because the police had reasonable suspicion and embarked on a search of limited intrusiveness.[15]*179 As such, we once again reject the notion that a little bit of information justifies a little bit of a search.
Reversed.
STRINGER, Justice, dissenting.
While I agree with the court's conclusion that the police officer's actions in this case constituted an illegal search under the Fourth Amendment, I believe that Carter failed to show that he had a legitimate expectation of privacy in Thompson's apartment and I therefore dissent.
"The proponent of a motion to suppress has the burden of establishing that his own Fourth Amendment rights were violated by the challenged search or seizure." Rakas v. Illinois, 439 U.S. 128, 131 n. 1, 99 S. Ct. 421, 424 n. 1, 58 L. Ed. 2d 387 (citations omitted). A challenge to a search must establish ab initio a legitimate expectation of privacy in the invaded place that is, an expectation of privacy that "society is prepared to recognize as `reasonable.'" Id. at 143-44, n. 12, 99 S.Ct. at 430, n. 12 (quoting Katz v. United States, 389 U.S. 347, 361, 88 S. Ct. 507, 516, 19 L. Ed. 2d 576 (Harlan, J., concurring)).
The United States Supreme Court has acknowledged that the mere fact that a person is legitimately on the premises of another is insufficient to give that person standing to contest a search of the other person's premises. Rakas, 439 U.S. at 143, 99 S.Ct. at 430. Courts have found a legitimate expectation of privacy to exist where the defendant demonstrated a meaningful connection to the property or the host for example, where the defendant was related to the host or had been given a key to the premises. See, e.g., United States v. Haydel, 649 F.2d 1152 (1981) (holding that defendant had legitimate expectation of privacy in his parent's home to which he had a key and unencumbered access); Rose v. United States, 629 A.2d 526 (D.C.App.1993) (holding that defendant had standing to challenge search of close relative's house to which he had a key and was a regular visitor). But standing has been denied where the party alleging an illegal search established no more than that they were a transient visitor to the property of another where, for example, the defendant was present on the property only to use the telephone or bathroom,[1] was merely a party guest,[2] or otherwise failed to establish a connection to the property beyond simply being present at the time of the search.[3] Further-more, *180 at least one court has recognized that a defendant present at the time of a narcotics search and a member of a criminal venture does not have a reasonable expectation of privacy sufficient to challenge the unannounced police entry of the apartment of another being used as a drug packaging operation. See United States v. Lockett, 919 F.2d 585 (9th Cir.1990).[4]
Here, Carter established nothing beyond the fact that he was present in Thompson's apartment for a period of 2 1/2 hours. He introduced no evidence that he had any prior relationship with Thompson, that he had ever been to her apartment before the night of his arrest, that he had personal effects in the apartment, that he had a key to the apartment, that he could invite or exclude others, or that he had any connection with the apartment other than his presence at the time of the search. The record is simply void as to any indicia that Carter was anything more than a brief, transient visitor. On these facts, it cannot be said that Carter met his burden of establishing a reasonable expectation of privacy in the apartment. I would therefore hold that Carter did not have standing to challenge the search of the apartment and affirm the decision of the court of appeals.
KEITH, Chief Justice (dissenting).
I join in the dissent of Justice Stringer.
BLATZ, Justice (dissenting).
I join in the dissent of Justice Stringer.
NOTES
[1] Thielen testified at the omnibus hearing that he spoke with the confidential informant for 15 to 25 minutes. He gave no further detail, however, about what their conversation involved, stating that to do so would reveal the informant's identity.
[2] Thompson was a co-defendant in the omnibus hearing. She subsequently pled guilty and is not a party to this appeal.
[3] Jones was being interpreted as establishing "automatic standing" to challenge the legality of a search for any persons charged with crimes of possession. United States v. Salvucci, 448 U.S. 83, 83, 100 S. Ct. 2547, 65 L. Ed. 2d 619 (1980). Salvucci overruled this holding to establish that the defendant must show a possessory interest in the items seized and an expectation of privacy in the areas searched to establish that he/she had standing to challenge the legality of a search. Id.
[4] The district court found that Carter had no expectation of the privacy in the area from which Thielen observed the illegal activity. As we will discuss infra in Section II, however, the proper question is whether Carter had an expectation of privacy in the area into which Thielen was looking namely the inside of the apartment.
[5] The issue of whether a defendant has standing to assert a violation of the Fourth Amendment has a long and muddled history. Throughout the first half of this century, courts decided standing by using common-law concepts of private property. Courts generally found those individuals who had an ownership interest, a leasehold, or "dominion and control" over the searched property to have standing to contest a search of the property. Courts, meanwhile, found that mere "guests" and "invitees" did not have such standing. Jones, 362 U.S. at 265-66, 80 S.Ct. at 733 (citations omitted). The Supreme Court rejected this property-based approach in favor of a broad rule that allowed "anyone legitimately on the premises where a search occurs" to challenge its legality by way of a motion to suppress. Id. at 267, 80 S.Ct. at 734. The Court later retreated from the "legitimately on the premises" test. Rakas, 439 U.S. at 128, 99 S.Ct. at 423. The Court in Rakas held that the mere fact that an individual was "legitimately on the premises" was insufficient to give that person standing to contest a search of another's dwelling place. Id. at 143, 99 S.Ct. at 430.
[6] Many other courts have concluded that Olson does not require a criminal defendant to prove his or her status as a guest to establish a legitimate expectation of privacy. See, e.g., Hill v. United States, 664 A.2d 347, 352 (D.C.1995) ("To be sure, being an overnight guest is not the sole means by which one may claim an expectation of privacy in another's home.") (citations omitted); Davis v. State, 582 So. 2d 61, 61 (Fla.Dist.Ct.App. 1991) ("Olson does not necessarily deny standing to one whose status in a residence is less than that of an overnight guest."); State v. Wright, 119 N.M. 559, 893 P.2d 455, 459 (N.M.Ct.App.1995) ("[W]e do not read Olson to make an individual's overnight status as a houseguest a precondition to the right to assert an invasion of a reasonable expectation of privacy under the Fourth Amendment to the United States Constitution."); State v. Ackerman, 499 N.W.2d 882, 884 (N.D.1993) ("[M]uch of the reasoning underlying the Supreme Court's finding of standing on the part of an overnight guest would support standing on the part of other guests, as well * * *.").
[7] Carter offered evidence of Johns' slippers to show that the two were so comfortable inside the apartment that they must have been guests. While recognizing the relevance of such a fact, we refuse to place a great deal of constitutional significance on a person's footwear. It is interesting to note, however, that another court recently found a lack of standing in part on the fact that one of the defendants "was feigning sleep while fully dressed and wearing shoes." Hill v. United States, 664 A.2d 347, 350 (D.C.1995) (emphasis added).
[8] Although the fact that a person is legitimately on the premises is not by itself sufficient to establish standing, Rakas, 439 U.S. at 142, 99 S.Ct. at 429, it is important to note that a person who is not legitimately on the premises cannot have standing, 5 LaFave, supra, § 11.3(b), at 143. Courts also have concluded that "a showing that a person authorized to do so gave permission for the defendant to be present on that particular occasion" was sufficient to establish the fact that the defendant was legitimately on the premises. Id. at 144, 99 S.Ct. at 431.
[9] Many courts have denied standing where it is apparent that the party alleging the illegal search was on the property very briefly or had only a minimal connection to the property or the host. See, e.g., United States v. McNeal, 955 F.2d 1067 (6th Cir.1992) (finding no legitimate expectation of privacy where defendant stated he had stopped by the host's home only to use the telephone); Prophet v. United States, 602 A.2d 1087 (D.C.1992) (finding no standing where defendant had been at his friend's house for only 3 or 4 minutes prior to the police's entry); Davis v. State, 582 So. 2d 61 (Fla.Dist.Ct.App.1991) (finding no legitimate expectation of privacy where defendant had been given permission to enter house by occupant's boyfriend, but occupant never had seen the defendant before and was shocked to find him in her apartment); State v. Wise, 879 S.W.2d 494 (Mo.1994) (finding no legitimate expectation of privacy where defendant merely had entered occupant's apartment to make a phone call); State v. Baltimore, 242 Neb. 562, 495 N.W.2d 921 (1993) (finding no standing where defendant had entered neighbor's house only to use the bathroom).
[10] It is at least arguable that Thielen's position just outside the apartment window was on a common area and not the curtilage to Thompson's apartment.
[11] See United States v. Acevedo, 627 F.2d 68 (7th Cir.1980) (finding no search where police officer looked into an apartment window from a public gangway); People v. Berutko, 71 Cal. 2d 84, 77 Cal. Rptr. 217, 453 P.2d 721 (1969) (finding no search where officers on defendant's front porch were able to see illegal activity through an opening in window covering); People v. Wright, 41 Ill. 2d 170, 242 N.E.2d 180 (1968) (finding no search where officer standing on transit authority right-of-way was able to see through a crack in the window curtain into defendant's apartment); State v. Taylor, 61 Ohio App. 2d 209, 401 N.E.2d 459 (1978) (finding no search where officers looked into unshaded apartment window from public sidewalk).
[12] See, e.g., Lorenzana v. Superior Court of Los Angeles County, 9 Cal. 3d 626, 108 Cal. Rptr. 585, 587, 511 P.2d 33, 35 (1973) (finding a search where police leave the driveway and peek through a two-inch gap in a drawn window shade); Olivera v. State, 315 So. 2d 487, 491 (Fla.Dist.Ct.App.1975) (finding that police violated defendant's reasonable expectation of privacy by leaving the sidewalk and walking across grass outside apartment building to look into defendant's apartment window); State v. Harris, 919 S.W.2d 619, 623-24 (Tenn.Crim.App.1995) (stating that, while officers are free to position themselves on a public sidewalk, once they walk around the building or attempt to gaze into a window, their activity becomes a search); State v. Bowling, 867 S.W.2d 338, 341-42 (Tenn.Crim. App.1993) (finding a search where an officer in a driveway got down on his hands and knees with his head almost touching the ground to look into a private garage).
[13] The state asserts that Thielen's actions were analogous to those we found to be constitutional in State v. Buchwald, 293 Minn. 74, 196 N.W.2d 445 (1972). In Buchwald, an officer investigating a report of a marijuana party taking place in several hotel rooms knocked on the defendant's door and, after the defendant opened the door in response, the officer observed several marijuana cigarettes in plain view inside the room. Id. at 447. We held that the police officer's actions did not constitute a search. Id. at 448. We based our conclusion, however, on the fact the defendant had consented to the officer's "entry" by opening the door:
The observation into the defendant's open room by the police officer positioned outside the room was not an invasion of defendant's privacy, for the defendant himself opened the door voluntarily. He was not compelled to open it and the voluntariness of his doing so was not the less merely because the unknown knocker was a police officer.
Id. at 448. In this case it cannot be said that Carter in any way consented to Thielen's observations.
[14] The state also asserts that Thielen's warrantless search was reasonable because there were exigent circumstances. As we have stated in the past, police can make warrantless arrests, entries and searches of dwellings when they can demonstrate the existence of probable cause and exigent circumstances. State v. Lohnes, 344 N.W.2d 605, 610-11 (Minn.1984). Because the state admits that Thielen lacked probable cause, however, any reliance on this exception is misplaced.
[15] The State argues, and the court of appeals agreed, that Officer Thielen's actions were reasonable under State v. Crea, 305 Minn. 342, 233 N.W.2d 736 (1975). In Crea, after seeing a stolen snowmobile trailer in plain view outside the appellant's house, the police shined a flashlight into the garage and the basement window of the house and saw two stolen snowmobiles. Id. at 738. Without specifically invoking one of the exceptions to the warrant requirement recognized by the Supreme Court, we held that the officers had acted reasonably because: 1) after seeing the stolen snowmobile trailer in the driveway, they had "very strong" probable cause to believe the stolen snowmobiles were in the house; 2) "their intrusion, being visual and involving a basement window only, was minimal"; and 3) the late hour would have made obtaining a warrant difficult. Id. at 740. To the extent that Crea may be read as establishing that a warrantless search can be justified based on a general finding that it was "reasonable," it runs counter to the Supreme Court's holdings that the fact that an officer reasonably expected to find evidence and used the least intrusive means possible to achieve that end is insufficient to sustain a warrantless search. See Katz, 389 U.S. at 356, 88 S.Ct. at 514. Unlike here, the officers in Crea had "very strong" probable cause to suspect the stolen snowmobiles were inside the house. Crea, 233 N.W.2d at 740. It was not our intent in Crea to step back from the requirement of probable cause and exigent circumstances or to, in any other way, modify our analysis of warrantless searches under the Fourth Amendment.
[1] See, e.g., United States v. McNeal, 955 F.2d 1067 (6th Cir.1992) (holding no legitimate expectation of privacy where defendant stated that he had only stopped by the host's home to use the telephone); State v. Wise, 879 S.W.2d 494 (Mo. 1994) (holding no legitimate expectation of privacy where defendant had merely entered occupant's apartment to make a phone call); State v. Baltimore, 242 Neb. 562, 495 N.W.2d 921 (1993) (holding that defendant who had only entered neighbor's house to use the bathroom did not have a legitimate expectation of privacy, despite the fact that defendant was occasionally given a key to the house for purpose of using the garden hose).
[2] See, e.g., United States v. Maddox, 944 F.2d 1223 (6th Cir.1991) (holding that defendant had no reasonable expectation of privacy where nothing in the record indicated that he was anything other than a transient party guest); Lewis v. United States, 594 A.2d 542 (D.C.App.1991) (holding that a mere party guest does not have a reasonable expectation of privacy in the host's home).
[3] See, e.g., State v. Conklin, 249 Neb. 727, 545 N.W.2d 101 (1996) (holding that defendant did not have standing to challenge search that occurred while he was in neighbor's apartment where he was only an occasional guest at the apartment, possessed no interest in the property and had no freedom to exclude anyone from the premises); Hill v. United States, 664 A.2d 347 (D.C.App.1995) (holding that, where there was no evidence that the defendants had a key to their friend's apartment, that they could admit or exclude others from the apartment, or establishing how much time they had spent in the apartment, they had failed to demonstrate a legitimate expectation of privacy); Prophet v. United States, 602 A.2d 1087 (D.C.App.1992) (holding that defendant who had only been at his friend's house a few minutes before the police arrived did not have standing to challenge the entry); People v. Rodriguez, 69 N.Y.2d 159, 513 N.Y.S.2d 75, 505 N.E.2d 586 (1987) (holding that defendant found sleeping in the apartment of another had no standing where he was "a transient who had no indicia of legitimate or recognizable connection to the apartment where he was arrested or any relevant thing in that apartment"); Commonwealth v. Tann, 500 Pa. 593, 459 A.2d 322 (1983) (holding no legitimate expectation of privacy in apartment where defendant was only occasional visitor to apartment, had no possessory or proprietary interest in it, and had been present for only 10-15 minutes prior to search).
[4] Lockett involved an allegation that the police, in entering an apartment that housed a drug packaging operation, did not comply with the federal "knock-and-announce" statute, 18 U.S.C. § 3109 (1988). However, the standard applied in determining whether the defendant had standing to challenge the entry was the same as that used to determine standing to challenge a search: whether the defendant had "a legitimate expectation of privacy in the property used by the joint venture." 919 F.2d at 588. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/4215793/ | October 26, 2017
JUDGMENT
The Fourteenth Court of Appeals
WILLIE THOMAS, Appellant
NO. 14-16-00695-CR V.
THE STATE OF TEXAS, Appellee
________________________________
This cause was heard on the transcript of the record of the court below.
Having considered the record, this Court holds that there was no error in the
judgment. The Court orders the judgment AFFIRMED.
We further order this decision certified below for observance. | 01-03-2023 | 10-30-2017 |
https://www.courtlistener.com/api/rest/v3/opinions/1564374/ | 16 So. 3d 1279 (2009)
STATE of Louisiana, Appellee
v.
Tiffany WOODS, Appellant.
State of Louisiana, Appellee
v.
Emmanuel Scott, Appellant.
Nos. 44,491-KA, 44,492-KA.
Court of Appeal of Louisiana, Second Circuit.
August 19, 2009.
*1280 Louisiana Appellate Project by Peggy J. Sullivan, Monroe, for Appellant, Tiffany Woods.
Louisiana Appellate Project by W. Jarred Franklin, for Appellant, Emmanuel Scott.
Charles Rex Scott, II, District Attorney, Brady D. O'Callaghan, Suzanne Morelock Owen, Assistant District Attorneys, for Appellee.
*1281 Before STEWART, GASKINS and DREW, JJ.
DREW, J.
Following a joint bench trial, defendants Tiffany Monique Woods and Emmanuel Scott were convicted of second degree murder. Each was sentenced to the mandatory term of life imprisonment at hard labor without benefit of probation, parole, or suspension of sentence. Timely motions for reconsideration of sentence were denied. Defendants appeal. We affirm.
FACTS
Emmanuel Scott and Tiffany Monique Woods had a common-law relationship in New Orleans. Their home contained two children of Ms. Woods, and one child of Mr. Scott; together, their union produced one child, "Little Emmanuel," decedent herein, born June 23, 2005. As a consequence of Hurricane Katrina, they evacuated to the Shreveport area in August 2005 and lived in shelters for several weeks before moving into a home in Shreveport.
On November 27, 2005, emergency personnel were dispatched to their home after Little Emmanuel was found in his crib unresponsive. The parents reported that they had each conducted CPR on the child.
The law officers who arrived to investigate the incident observed the young child to be severely emaciated. An autopsy was later performed. The coroner ruled the cause of the child's death to be malnutrition.
The child lived only five months. This chronological record of the child's weight may be instructive:
As of date of birth, June 23, 20053 pounds, 2 ounces
As of release from the hospital, August 2, 20055 pounds, 6 ounces[1]
As of date of death, November 27, 20055 pounds, 13 ounces.[2]
The child was 45 centimeters (17.7 inches) in length upon release from the hospital. At the time of his death, 107 days later, he was 56 centimeters (22 inches) in length.
Corporal Patrick McConnell, a detective with the Shreveport Police Department, testified that:
he arrived at the scene on November 27, 2005, finding the house had been encircled with yellow crime scene tape;
he viewed the baby's body in the medic unit parked at the home;
the child's body was very thin, with mucus on his face;
the house was very clean and tidy;
the refrigerator was well stocked with food, organic milk, condiments, and beer;
jars of baby food were on top of the refrigerator;
in the bedroom was a full-sized bed, a play pen, and an infant bed;
he found two bottles of milk in the infant bed and one empty bottle inside the playpen;
he observed a heart monitor found in a closet;
he found that Woods' story that she performed CPR on the infant to be inconsistent with the mucus present on the child's mouth, in that the mucus would have been wiped away before or during CPR; and
he conducted recorded interviews with the defendants, without benefit of Miranda *1282 warnings, as he was not then conducting a homicide investigation.
Beverly Hunter, a now-retired social services worker, testified that:
on the day of the incident, she was the on-call supervisor for an emergency hotline relative to the protection of children;
she arrived after 1:00 p.m. and conducted interviews with family members (including both defendants);
the other children appeared unkempt, with one child being very dirty;
she was in the home about 3½ hours, and never observed anyone change the child's diaper, so she changed it herself, noticing spots on her bottom, dried mucus on her face, and a very lethargic demeanor;
Woods also had "a very flat affect" and when talking about grieving, Woods stated, "I'm not grieving" and "When I found it, it was stiff. It was going to die. I didn't kill it, and it was going to die, anyway";[3]
after consulting with law enforcement on the scene, Ms. Hunter became suspicious of the death and the overall care of the children, so the other three children were taken into custody;
the children were ready to leave, something highly unusual; and
many parents desire privacy under such circumstances and the workers were trained to recognize such possible reactions.
Dr. Frank Peretti, an expert in forensic pathology, testified that:
he took photographs of the child's body, performed an autopsy, and reported his findings;
his first impression was that the child was severely malnourished;
trauma as a cause of death was ruled out;
he found no evidence of a natural disease process;
the cause of death was malnutrition, which had gone on for months;
the infant had a high blood urea nitrogen (BUN) level which indicated that the victim was in kidney failure due to malnutrition;
the body contained no fat, indicating the use of fat as nutrition;
there was no evidence of pyloric stenosis, which, if present, could have made it difficult for the child to feed;
there was no evidence of an anatomical defect preventing food intake;
all babies, including premature ones, are born with fat on their bodies;
the victim's intestines were not developmentally abnormal;
because the child had some medical history, he ruled the cause of death as malnutrition (the child not getting enough food) as opposed to starvation, which involves deliberate withholding of food; however
the child's body contained no food, no fat, and no muscle;
the fact that a child was starved would not prevent a disorder from being apparent during the autopsy; and
the victim did not have a metabolic disorder.
Dr. Gerald Whitton, an expert in pediatrics and neonatology, testified that:
his daily practice consisted of caring for babies, the majority of them premature, in the neonatal intensive care unit (NICU);
he reviewed the victim's medical records from Tulane Medical Center *1283 ("TMC") and the autopsy report prepared by Dr. Peretti;
the victim was delivered at 31 3/7 weeks of gestation[4] by emergency Caesarean section as a result of a placental abruption;[5]
during the pregnancy, the mother had limited prenatal care;
the mother used marijuana and drank beer during the pregnancy;
the emergency delivery was unproblematic, though the child was born weighing only 3 pounds, 2 ounces;
the victim had minor problems normally associated with an intensive care stay, such as high blood sugar and electrolyte abnormalities, as well as a positive screen for medium chain acyl-CoA dehydrogenase deficiency ("MCAD"), though a false positive occasionally occurs with a premature child;
the false positive was confirmed by the geneticists at TMC;
the child was initially fed through a tube and then he was able to adapt to nipple feedings, thereby gaining adequate weight until reaching the 10th percentile growth curve during his hospitalization;
based on his weight at death, his growth curve was essentially flat from the time of his discharge to the time of his death;
at discharge from TMC, the child weighed 5 pounds, 6 ounces;
at his death, the child had gained only seven ounces, even though at the time of discharge from TMC, the child had been gaining weight at the rate of approximately one ounce per day;
viewing the pre-autopsy photos of the deceased child, he did not believe that the child would have been discharged from the hospital had he presented with a similar appearance or condition;
a baby fed organic cows' milk will experience many complications, though the child will continue to grow to some extent;
cause of death was malnourishment, and it would have taken an extended time for the baby's condition to deteriorate to this extent;
lack of nutrition would have brought about noticeable changes in the child, such as irritability, decreased activity, and the onset of lethargy;
medical intervention could have averted the child's death;
emergency medical care is never refused based on inability to pay;
he had not treated the victim, and his opinions were based on his general knowledge and training;
he was not familiar with the specific procedures employed by TMC;
the records indicated that Woods had received CPR instruction and "generally" with CPR there would be other education provided, but he was not aware of the specific training, education, or instruction either parent received;
he believed the MCAD test was probably a false positive, potentially caused by the child's prematurity;
later confirmatory tests detected no abnormalities;
additional testing was ordered at TMC, but the patient did not show;
the child's growth, while hospitalized, was within the lower normal range, as *1284 the victim was within the 10th percentile;[6]
it is the legal obligation of a physician to report any suspected abuse;
there were various reasons why a child would not feed well, and generally, if presented with the situation, a medical evaluation would be performed to determine the cause of the problem;
possible causes could stem from metabolic issues, infection (viral or bacterial), constipation, or suck and swallow issues;
both the physical therapist and occupational therapist who treated the victim during his hospitalization found that he was not experiencing great difficulty with "suck and swallow" techniques, as the baby was still receiving proper nutrition and gaining weight;
this child was the "worst-off baby" he had ever seen; and
nothing in the medical records indicate that the victim could not reach the goals set by the nutritionist or was predisposed to malnutrition.
Defendant Scott, the victim's father, testified that:
his son was quite small at birth;
he worked while Woods took care of the children;
there were three children in the home, besides Little Emmanuel;
after the hospital discharge, the baby would spit up milk, though Scott did not think that was a problem, as her daughter had done the same thing;
the family evacuated to Shreveport as a result of Hurricane Katrina, and they lived in shelters upon their arrival;
medical personnel were present at the shelters and one couple volunteered to use their insurance to take the child to the doctor;
he believed what he and Woods were doing was the best they could;
the family found a home in Shreveport and he worked at McDonald's, while Woods stayed at home, caring for the two youngest children, with the help of the oldest child, an eight-year-old;
two weeks before the child died, the family ran out of WIC vouchers;
they then tried organic cows' milk to get the child to feed better;
the baby appeared to tolerate the milk with no problem;
the child appeared to grow longer, and because of the baby's build, he did not see there was a problem;
he himself had been a preterm baby and he thought all was normal;
the doctors never told them anything was wrong with the child;
he did not mean to starve his child;
he never told Woods not to feed him;
the night before the victim died, he worked until around 1:00 a.m;
he watched TV briefly before going to the bedroom that he shared with Woods and the two younger children;
when he awoke the next morning, he went out to smoke a cigarette;
he saw the victim but did not touch or check on him at that time;
he later noticed something wrong with the baby's mouth;
he grabbed the child and started CPR while Woods called 9-1-1;
at some point, they switched, with Woods performing CPR and Scott talking to the 9-1-1 operator;
*1285 his lack of emotion at the scene was because he believed that the baby would revive because the victim gasped for air during CPR;
he was not told on the scene that the child was dead;
he loved his children and did not intend to neglect the baby;
he had a ninth grade education and had not completed a GED class;
the victim received inoculations from Shots for Tots in Shreveport;
the family had enough income to purchase food but the decision to switch to watered down organic cows' milk was in part an attempt to keep the victim from spitting up so frequently;
the baby never deteriorated after the switch to diluted milk; and
prior to the victim's death, Scott never saw anything to alarm him nor did he believe there was any reason to contact a doctor.
Dr. Shalinee Singh, an expert in the field of pediatrics, testified that:
she reviewed the child's medical records including discharge summaries;
the medical records lacked social service notes and lab results;
she reviewed the letter from the geneticist to Dr. Whitton regarding retesting the victim but the results of the test were not in the record;
she reviewed the dietician's notes which showed that the dietician believed the victim was not quite meeting the caloric requirements necessary for him to thrive once he began feeding orally;
the dietician recommended that the formula intake be increased;
even at the hospital, the child was receiving only enough nutrition to meet the lower end of his energy needs, but not enough to grow;
the treating physician recommended that the child's intake be increased, but the nurses were unable to meet the child's caloric needs, even with around-the-clock feedings;
she was surprised that the baby was discharged, considering that the nurses had not been able to meet the child's feeding goals;
if the nurses couldn't meet the feeding goals in the hospital, then a mother would certainly be unable to meet the goals at home;
the physical therapist had been unable to evaluate the victim's ability to suck because every time she went to see the victim, he was asleep;
one week prior to discharge, the victim was termed a poor feeder;
one week prior to discharge, the mother had not had the opportunity to practice and show the nurses that she could feed the victim;
she would not have released the child had she been his treating physician;
the medical records did not contain any notes indicating that Scott received any educational counseling regarding proper infant care;
a pediatrician should have followed a child after release from neonatal care;
whether the victim had a metabolic defect had neither been discounted nor established by the information she reviewed;
a child with a metabolic defect can look like the pre-autopsy photos;
she did not find the records where disease had been ruled out;
the nutritionist treating the baby noted that he was at low risk for nutrition and was gaining weight, and that the occupational therapist noted that the *1286 child was feeding well prior to his discharge;
she was unaware that Woods had other children older than the victim, and this fact would have been considered in determining when the victim could be safely discharged from the hospital, as a mother with children would have needed less instruction than a first-time mother;
a child switched to diluted cows' milk would develop "dramatic and observable health problems" and there would have been "gross evidence" of the problems the child was experiencing;
she was familiar with the WIC program that provided nutritional aid to mothers, infants and children;
WIC requires a pediatrician's documentation of weight and sometimes a prescription for the formula;
if parents give an infant cows' milk, instead of formula, the child would have quickly suffered as a result of the diet; but
she has found that an adverse change in a child's diet was usually due to uneducated parents, as opposed to a desire to harm a child.
Defendant Woods testified on her own behalf, recalling that:
she started caring for the baby right before the hospital discharge;
she was shown a video on CPR the night before leaving the hospital;
this was the full and total extent of the training she received;
she was instructed to give the baby medicine every day, to utilize a heart monitor, and to feed the child every three to four hours;
she had immediate problems working with the heart monitor;
she asked for help with the machine, to no avail;
she was unsupervised when feeding Emmanuel prior to his release from the hospital and had given him only one bottle at the hospital;
the victim would not take much of the bottles he was offered;
she fed him every four hours but the child slept through the night;
consumption at each feeding varied, usually one or two ounces;
the baby threw up, sometimes as much as he actually consumed;
the feeding problems were to be expected with a premature child;
around the end of October, the family did not have any more WIC vouchers and the decision was made to switch to cows' milk;
the victim took more and threw up less when consuming the milk;
she noticed no weight change upon the switch to cows' milk;
the baby's weight had not changed since the hospital discharge;
she noticed no health problems with the baby, other than throwing up after feedings and a slight runny nose;
her older son assisted with feeding the victim when needed;
Scott wasn't very involved in feeding the baby because he was always at work, but when he had an opportunity, he would feed the child;
Scott suggested switching the child to cows' milk, and she complied;
she did not drive and was unfamiliar with the Shreveport area and this prevented her from taking the victim to the doctor;
while living in a shelter, she spotted a "Shots For Tots" truck and had Scott stop so the children could receive inoculations; and
*1287 while they were living in the shelters, all her children saw medical personnel, none of whom ever expressed any other concerns or told Woods that the victim needed to be taken to the hospital.
DISCUSSION
Sufficiency
Woods argues that the state failed to present sufficient evidence to convict her of second degree murder; specifically, the defendant contends that the state failed to rule out that the victim died from MCAD. She also argues that the state failed to prove beyond a reasonable doubt that her care of the child was a gross deviation below the accepted standard of care.
Scott argues that the state failed to prove either that he intentionally harmed the child, or that his conduct with respect to the child was criminally negligent. Further, the state failed to exclude every reasonable hypothesis of innocence, specifically that the child suffered from a physical disorder that prevented him from gaining weight.
Our law on sufficiency review is well settled.[7]
All persons concerned in the commission of a crime, whether present or absent, and whether they directly commit the act constituting the offense, aid and abet in its commission, or directly or indirectly counsel or procure another to commit the crime, are principals. La. R.S. 14:24.
In pertinent part, second degree murder is the killing of a human being when the offender is engaged in the perpetration of cruelty to juveniles, even though he has no specific intent to kill or to inflict great bodily harm. La. R.S. 14:30.1(A)(1).
Cruelty to a juvenile, as it relates to this matter, is defined as the intentional or criminally negligent mistreatment or neglect by anyone 17 years of age or older *1288 of any child under the age of 17, whereby unjustifiable pain or suffering is caused to the child. La. R.S. 14:93. The term "intentional" within the meaning of this statute requires general criminal intent to cause a child unjustifiable pain and suffering. State v. Porter, 99-1722 (La.App. 3d Cir.5/3/00), 761 So. 2d 115. Mistreatment as used in this statute means "abuse." Id.
Criminal negligence exists when, although neither specific nor general criminal intent is present, there is such a disregard of the interest of the others that the offender's conduct amounts to a gross deviation below the standard of care expected to be maintained by a reasonably careful man under like circumstances. Unlike general or specific criminal intent, criminal negligence is essentially negative. Rather than requiring the accused to intend some consequence of his actions, criminal negligence is found from the accused's gross disregard for the consequences of his actions. La. R.S. 14:11; State v. Martin, 539 So. 2d 1235 (La.1989).
The state presented testimony showing that:
the child failed to gain a significant amount of weight in the 3% months between his release from the hospital and his death;
defendants failed to timely seek medical treatment for the victim who was apparently in dire straits at the time of his death;
the baby would have had an obvious bad reaction to his changed diet;
defendants indicated they did not observe any of these signs; and
defendants were criminally negligent in failing to so notice.
The trial court orally gave detailed, cogent, and succinct reasons for finding both of the defendants guilty as charged. The reasoning reflects the mindset of a fair, impartial, and hard-working jurist. We appreciate the efforts of the trial court in this depressing case.
The bottom line is that the state proved that these defendants criminally mistreated this child, resulting in his death due to malnutrition. The photos of the baby are grotesque, horrifying, and inexcusable.
Excessiveness
Defendants argue that the punishment here does not fit the crime, in that there was no showing of anyone's intent to kill the baby, or to inflict great bodily harm. They argue that life sentences under these facts are clearly excessive.
The state replies that neither defendant clearly and convincingly showed, under these facts, that unusual circumstances exist, requiring for either sentence a downward departure from the mandatory sentence fixed by the statute and imposed by the trial court. The argument that the other children are being deprived of their parents has no merit, considering the treatment afforded their baby.
Our law on the appellate review of mandatory sentences is well settled.[8]
*1289 This was not the first child to be in this household. The defendants were already in the process of rearing three children when Little Emmanuel was born. There is no excuse for what these two people allowed to happen to the infant.
The gravity of the offense and the culpability of the defendants warrant no downward departure from their legislatively mandated sentences.
DECREE
The convictions and sentences for these defendants are AFFIRMED.
NOTES
[1] A gain of 36 ounces in the 40 days of hospitalization.
[2] A gain of 7 ounces in the 107 days between release from the hospital and death.
[3] Use of the impersonal pronoun speaks volumes as to the lack of bonding.
[4] "Full-term" is considered 40 weeks.
[5] A condition where the placenta tears away from the uterus.
[6] Average growth would be from the third to the 97th percentile.
[7] The standard of appellate review for a sufficiency of the evidence claim is whether, after viewing the evidence in the light most favorable to the prosecution, any rational trier of fact could have found the essential elements of the crime proven beyond a reasonable doubt. Jackson v. Virginia, 443 U.S. 307, 319, 99 S. Ct. 2781, 2789, 61 L. Ed. 2d 560 (1979); State v. Tate, XXXX-XXXX (La.5/20/03), 851 So. 2d 921, cert. denied, 541 U.S. 905, 124 S. Ct. 1604, 158 L. Ed. 2d 248 (2004); State v. Carter, 42,894 (La.App. 2d Cir. 1/9/08), 974 So. 2d 181, writ denied, XXXX-XXXX (La. 11/14/08), 996 So. 2d 1086. This standard, now legislatively embodied in La. C. Cr. P. art. 821, does not provide the appellate court with a vehicle to substitute its own appreciation of the evidence for that of the fact finder. State v. Pigford, XXXX-XXXX (La.2/22/06), 922 So. 2d 517; State v. Dotie, 43,819 (La.App. 2d Cir.1/14/09), 1 So. 3d 833. The appellate court does not assess the credibility of witnesses or reweigh evidence. State v. Smith, 94-3116 (La. 10/16/95), 661 So. 2d 442. A reviewing court accords great deference to a jury's decision to accept or reject the testimony of a witness in whole or in part. State v. Eason, 43,788 (La.App. 2d Cir.2/25/09), 3 So. 3d 685; State v. Hill, 42,025 (La.App. 2d Cir.5/9/07), 956 So. 2d 758, writ denied, XXXX-XXXX (La.12/14/07), 970 So. 2d 529. See also, State v. Bowie, 43,374 (La.App. 2d Cir.9/24/08), 997 So. 2d 36 (same deference applies to bench trial).
The Jackson standard is applicable in cases involving both direct and circumstantial evidence. An appellate court reviewing the sufficiency of evidence in such cases must resolve any conflict in the direct evidence by viewing that evidence in the light most favorable to the prosecution. When the direct evidence is thus viewed, the facts established by the direct evidence and inferred from the circumstances established by that evidence must be sufficient for a rational trier of fact to conclude beyond a reasonable doubt that defendant was guilty of every essential element of the crime. State v. Sutton, 436 So. 2d 471 (La. 1983); State v. Speed, 43,786 (La.App. 2d Cir. 1/14/09), 2 So. 3d 582; State v. Parker, 42,311 (La.App. 2d Cir.8/15/07), 963 So. 2d 497.
[8] Where there is a mandatory sentence, there is no need for the trial court to justify, under Article 894.1, a sentence it is legally required to impose. State v. Burd, 40,480 (La.App. 2d Cir. 1/27/06), 921 So. 2d 219, writ denied, XXXX-XXXX (La.11/9/06), 941 So. 2d 35; State v. Koon, 31,177 (La.App. 2d Cir.2/24/99), 730 So. 2d 503.
The mandatory sentence for second degree murder is punishment by life imprisonment at hard labor without benefit of parole, probation or suspension of sentence. La. R.S. 14:30.1(B). The argument that the mandatory life sentence for second degree murder is a violation of the prohibition against excessive punishment in the Louisiana Constitution has been repeatedly rejected. State v. Parker, 416 So. 2d 545 (La.1982); State v. Brooks, 350 So. 2d 1174 (La. 1977); State v. Roberson, 40,809 (La.App. 2d Cir.4/19/06), 929 So. 2d 789.
In State v. Dorthey, 623 So. 2d 1276 (La. 1993), and State v. Johnson, XXXX-XXXX (La.3/4/98), 709 So. 2d 672, the supreme court addressed the issue of mandatory sentences in the context of the habitual offender law. The court held that the downward departure from a mandatory minimum sentence may occur in rare circumstances if the defendant rebuts the presumption of constitutionality by showing clear and convincing evidence that he is exceptional, namely, that he is a victim of the legislature's failure to assign sentences that are meaningfully tailored to the gravity of the offense, the culpability of the offender, and the circumstances of the case. This rule has been extended to mandatory sentences beyond habitual offender cases. See State v. Fobbs, XXXX-XXXX (La.9/24/99), 744 So. 2d 1274; State v. Chandler, 41,063 (La.App. 2d Cir.9/8/06), 939 So. 2d 574, writ denied, 2006-2554 (La.5/11/07), 955 So. 2d 1277. However, the "rare circumstances" described by Johnson in which a mandated sentence can be altered are even less likely in the case of a life sentence chosen by the legislature for a single crime, such as aggravated rape or second degree murder. State v. Chandler, supra. In such crimes, unlike the mandatory minimum sentence under the habitual offender law, the "tailoring" of the sentence by the legislature was for life because the culpability of offenders and the gravity of the offense are so great. Id. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564390/ | 16 So. 3d 833 (2005)
Stephen MANUEL, Appellant,
v.
STATE of Florida, Appellee.
No. 1D03-2587.
District Court of Appeal of Florida, First District.
May 16, 2005.
*834 Nancy A. Daniels, Public Defender; and Jeffrey N. Golant, Certified Legal Intern, Tallahassee, for Appellant.
Charlie Crist, Attorney General; and Shasta W. Kruse, Assistant Attorney General, Tallahassee, for Appellee.
BROWNING, J.
ON MOTION FOR REHEARING AND TO CERTIFY CONFLICT AND CERTIFY QUESTION
Appellant's motion for rehearing is granted and our original opinion is vacated and replaced by the following opinion.
Appellant seeks review of his conviction and sentence for aggravated battery. He raises three issues on appeal; only one has merit. Because the trial court erred by admitting hearsay testimony, we reverse and remand for a new trial.
First, Appellant alleges the trial court erred in permitting the State to amend the information against him on the day of jury selection. Appellant is not entitled to relief on this issue because he failed to move for a continuance. See Yelvington v. State, 664 So. 2d 262 (Fla. 1st DCA 1995).
Second, Appellant raises several challenges to the trial court's denial of his motion for judgment of acquittal. There is no merit to Appellant's argument that he should have been acquitted because a witness's written statement and the victim's statement to the officer should not have been admitted. This is so because even evidence later found to have been erroneously admitted can support the denial of a motion for judgment of acquittal. See, e.g., State v. Brockman, 827 So. 2d 299, 302-03 (Fla. 1st DCA 2002). There is no merit to Appellant's argument that the State did not rebut his reasonable hypothesis of innocence, because the State need rebut such a hypothesis only where all evidence is circumstantial. See Melton v. State, 824 So. 2d 948 (Fla. 1st DCA 2002); State v. Law, 559 So. 2d 187 (Fla.1989). Here, the evidence includes the victim's eyewitness statement, which is direct evidence. See Thorp v. State, 777 So. 2d 385, *835 389 (Fla.2000). There is no merit to Appellant's argument that the State did not adequately prove intent because, taking the evidence in a light most favorable to the State, intent can be inferred from the circumstances of the incident. Because direct evidence of intent is rare, and intent is usually proven through inference, "a trial court should rarely, if ever, grant a motion for judgment of acquittal on the issue of intent." Washington v. State, 737 So. 2d 1208, 1215 (Fla. 1st DCA 1999). By failing to raise such argument in his initial brief, Appellant has waived any argument that the State did not prove other elements of the crime. See Marshall v. State, 854 So. 2d 1235 (Fla.2003). To the extent Appellant argues the trial court erred by denying his judgment of acquittal because the State failed to rebut his evidence of self-defense, he is not entitled to relief because the argument was not adequately preserved below.
Third, Appellant alleges the trial court erred in admitting the victim's statement to a police officer as to how the victim was injured. The statement should not have been admitted, despite its nature as an excited utterance, because it does not meet the requirements necessary to protect Appellant's right to confront witnesses against him. The victim's statement was testimonial in nature because it was made in response to the officer's direct questioning; the State has not demonstrated that the victim was unavailable to testify; and the prior cross-examination of the victim at deposition was done only for purposes of discovery and not to perpetuate the victim's testimony. Because the statement was testimonial but Appellant had no sufficient opportunity to cross-examine the victim on that statement, the statement is inadmissible under Crawford v. Washington, 541 U.S. 36, 124 S. Ct. 1354, 158 L. Ed. 2d 177 (2004). See Lopez v. State, 888 So. 2d 693 (Fla. 1st DCA 2004).[1]
The trial court's error is not harmless, for the victim's statement is the only direct eyewitness testimony that the victim was injured by the hatchet swung by Appellant.
As we did in Lopez, we certify conflict with Blanton v. State, 880 So. 2d 798 (Fla. 5th DCA 2004).
REVERSE and REMAND for a new trial.
LEWIS and POLSTON, JJ., CONCUR.
NOTES
[1] These cases had not been decided when the trial court made her ruling, which, when made, was correct under existing precedent. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564591/ | 34 So. 3d 13 (2010)
BABOOLAL
v.
BABOOLAL.
No. 4D08-2991.
District Court of Appeal of Florida, Fourth District.
May 5, 2010.
Decision Without Published Opinion Affirmed. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1734862/ | 543 N.W.2d 876 (1996)
STATE of Iowa, Appellant,
v.
Glen Lavern MEYER, Appellee.
No. 95-615.
Supreme Court of Iowa.
February 14, 1996.
*877 Thomas J. Miller, Attorney General, Robert P. Ewald, Assistant Attorney General, and Paul L. White, County Attorney, for appellant.
Linda Del Gallo, State Appellate Defender, and Sara E. Hennesy, Assistant State Appellate Defender, for appellee.
Considered by McGIVERIN, C.J., and HARRIS, LAVORATO, NEUMAN, and ANDREASEN, JJ.
ANDREASEN, Justice.
We granted the State's application for discretionary review of the district court's ruling on the defendant's motion to suppress evidence seized during the search of his vehicle. Although the court found the defendant had been legally stopped for speeding and legally arrested on an outstanding warrant that later turned out to be improperly outstanding, it granted the motion to suppress because it found "there was no probable cause to search defendant's vehicle incident to his arrest." We find the search was a valid search incident to arrest and therefore reverse the court's ruling and remand the case for trial.
Because a constitutional issue is involved, our review is de novo. State v. Hofmann, 537 N.W.2d 767, 769 (Iowa 1995). We make an independent evaluation of the totality of the circumstances as shown by the record. State v. Cook, 530 N.W.2d 728, 731 (Iowa 1995).
I. Background.
On October 19, 1994, Iowa State Trooper Hilt, while on routine patrol, stopped Glen Lavern Meyer for speeding. The trooper had clocked Meyer, the driver and sole occupant of a station wagon, going eighty-two miles per hour in a fifty-five mile-per-hour zone. He issued a citation for speeding in lieu of arrest as permitted by Iowa Code section 805.1 (1993).
While preparing the citation the trooper ran a routine radio check on Meyer's driver's license. He was told the license was valid but there was an outstanding warrant for the arrest of Meyer for parole violation. When confronted by this information, Meyer stated he had been released from parole. Trooper Hilt then requested by radio a computer check of the arrest warrant. This check confirmed that there was an active warrant *878 for Meyer initiated by the department of corrections. He then placed Meyer under arrest. He advised Meyer that he would be taken to the sheriff's office, that he could not drive his vehicle, and that a tow truck would be sent to pick up his vehicle.
The trooper testified he did an initial search incident to the arrest of the vehicle at the scene. Upon search of the vehicle, he found an open canister of marijuana. Meyer was then taken to the sheriff's office. Upon arrival trooper Hilt made a phone call to the department of corrections and was told Meyer had indeed been released from parole. When the parole officer was contacted by Hilt, she stated Meyer had been released and the warrant should have been eliminated from the computer.
On October 31 Meyer was charged with possession of a controlled substance, marijuana, in violation of Iowa Code section 124.401(3). He entered a not guilty plea. On January 6, 1995, he filed a motion to suppress evidence obtained during the search of his vehicle. He claimed the search was made incident to an illegal arrest and no other probable cause existed for the search. The district court granted the motion.
On appeal the State argues the evidence found in the vehicle was a result of a legal search incident to arrest or, alternatively, that Hilt's reliance on the arrest warrant was reasonable and satisfied the good faith exception to the exclusionary rule.
II. Search Incident to Arrest.
An arrest is the taking of a person into custody when and in the manner authorized by law. Iowa Code § 804.5. A peace officer may make a lawful arrest in obedience to a warrant; and without a warrant as provided by Iowa Code section 804.7. "[A]n illegal arrest will generally require suppression of any evidence seized pursuant to the arrest." State v. Thornton, 300 N.W.2d 94, 95 (Iowa 1981).
This case involves the validity of the arrest and the scope of the search incident to the arrest. In both Chimel v. California, 395 U.S. 752, 762-63, 89 S. Ct. 2034, 2040, 23 L. Ed. 2d 685, 694 (1969), and United States v. Robinson, 414 U.S. 218, 235, 94 S. Ct. 467, 477, 38 L. Ed. 2d 427, 440-41 (1973), the Court adopted a categorical rule that when a valid custodial arrest occurs, a search incident to arrest is automatically permissible. The lawfulness of the arrest establishes the authority to search. In Gustafson v. Florida, 414 U.S. 260, 266, 94 S. Ct. 488, 492, 38 L. Ed. 2d 456, 461 (1973), the Court held a search incident to arrest may be conducted even when the custodial arrest is for driving without a driver's license, a very minor traffic violation. The individual officer is permitted virtually unlimited discretion in deciding when to make an arrest, issue a citation, or give a warning. A person known by the officer to have violated traffic laws is subject to full custodial arrest. State v. Becker, 458 N.W.2d 604, 607 (Iowa 1990).
In Cook, decided after the trial court had made its ruling, we stated:
The full search of the arrestee's person "is not only an exception to the warrant requirement of the Fourth Amendment, but is also a `reasonable' search under the Amendment." Being reasonable per se, a search incident to arrest, even when the offense is only a minor traffic violation, requires no additional justification.
Cook, 530 N.W.2d at 731 (citations omitted). Although the trooper's observation of a seat belt violation gave him probable cause to arrest the defendant, he chose to only give the defendant a citation. Id. We concluded
the trooper's decision to issue the defendant a citation in lieu of a custodial arrest did not affect the trooper's right to conduct a search of the same scope as a search incident to arrest because a citation is equivalent to a custodial arrest for authority to search purposes under Iowa Code section 805.1(4).
Id. at 733. We upheld the search of the defendant's person as within the scope of a search incident to arrest. Id.
Here, the trooper found marijuana in an open film canister sitting on the hump between the seats of Meyer's station wagon. In New York v. Belton, 453 U.S. 454, 460, 101 S. Ct. 2860, 2864, 69 L. Ed. 2d 768, 775 (1981), the Court held an officer making a lawful custodial arrest of an occupant of a vehicle may, as a contemporaneous incident of that *879 arrest, search the passenger compartment of the vehicle. Similarly, where the defendant was stopped and arrested for speeding, we held the search of the defendant's vehicle after the defendant had been placed in the patrol car was a valid search incident to arrest. State v. Edgington, 487 N.W.2d 675, 678 (Iowa 1992).
A search incident to lawful arrest is legal even if the arresting officer had an ulterior motive for the arrest or had no independent probable cause to conduct the search. State v. Garcia, 461 N.W.2d 460, 463 (Iowa 1990). We have adopted an objective or "could" assessment of the arresting officer's conduct in making the arrest. Hofmann, 537 N.W.2d at 770. "So long as the officer is legally permitted and objectively authorized to do so, an arrest is constitutional." Id.
III. Conclusion.
Trooper Hilt was legally permitted to arrest Meyer for the speeding violation. The issuance of a citation for speeding gave the officer the right to conduct a search incident to arrest. The scope of a search incident to arrest of a driver permits the search of the passenger compartment of the vehicle. Objectively, Hilt could conduct the automobile search made at the scene of the arrest. Although he may not have done so if an outstanding warrant for Meyer's arrest had not been reported, he "could" have searched the vehicle incident to the issuance of the citation. Even if the arrest warrant was invalid, the search of the vehicle conducted by the officer was a reasonable search because the citation issued by him gave him reasonable cause to conduct the search.
Having concluded the search was valid, we need not discuss or determine if a search, conducted pursuant to an arrest warrant that had mistakenly not been lifted at the time of arrest, would constitute a good faith exception to the exclusionary rule under the holding in Arizona v. Evans, 514 U.S. ___, 115 S. Ct. 1185, 131 L. Ed. 2d 34 (1995).
REVERSED AND REMANDED. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1376147/ | 866 F. Supp. 975 (1994)
GREATER NEW ORLEANS BROADCASTING ASSOCIATION, INCORPORATED, et al.
v.
UNITED STATES of America, et al.
Civ. A. No. 94-656.
United States District Court, E.D. Louisiana.
October 31, 1994.
*976 Ashton Richard Hardy, Hardy & Carey, Metairie, LA, Marjorie Ruth Esman, Atty. at Law, New Orleans, LA, for plaintiffs Greater New Orleans Broadcasting Ass'n, Phase II Broadcasting, Inc., Radio Vanderbilt Inc., *977 Keymarket of New Orleans, Inc., Professional Broadcasting, WGNO, Inc., Burnham Broadcasting Co.
Nancy Ann Nungesser, U.S. Atty's Office, New Orleans, LA, Lisa A. Olson, U.S. Dept. of Justice, Civ. Div., Theodore Hirt, Lois Bonsal Osler, U.S. Dept. of Justice, Washington, DC, for defendants U.S., F.C.C.
Charles L. Spencer, Hebert & Spencer, Baton Rouge, LA, for movant Louisiana Ass'n of Broadcasters.
ORDER AND REASONS
EDWARD J. BOYLE, Sr., District Judge.
This declaratory action comes before the Court on motion for summary judgment filed by the plaintiffs, Greater New Orleans Broadcasting Association, Inc. ("broadcasters") and cross motion for summary judgment filed by the defendants, the United States of America and the Federal Communications Commission (collectively "FCC"), both parties having agreed that this matter can be determined summarily. Having considered the record, the memoranda of counsel and the law, the Court has determined that the motion of the plaintiffs should be denied and the motion of the defendant granted as submitted.[1]
Three issues concerning broadcast restrictions on casino advertising are presented to this Court on cross motion: (1) whether a stay of enforcement by the FCC in Nevada violates the equal protection clause; (2) whether prohibitions against the broadcast of certain "lottery" information apply to casino gaming; and (3) whether those restrictions violate the plaintiffs' freedom of speech, due process rights, freedom to contract and equal protection of the law under the First Amendment. These issues largely reflect those presented in Valley Broadcasting v. United States, 820 F. Supp. 519 (D.Nev.1993), wherein the district court granted summary judgment in favor of broadcasters and struck down the broadcast advertising restrictions imposed by statute and FCC regulations.[2] That decision focused on the First Amendment challenge and found that the FCC prohibitions did not directly advance substantial government interests and were unconstitutionally broad for purposes of the commercial speech analysis set forth in Central Hudson Gas & Electric Corp. v. Public Service Commission, 447 U.S. 557, 100 S. Ct. 2343, 65 L. Ed. 2d 341 (1980).
EQUAL PROTECTION
The plaintiffs' equal protection claim is directed to the decision by the FCC to stay enforcement of the challenged broadcast regulations in Nevada pending appellate review of Valley Broadcasting. The plaintiffs do not dispute the fact that the stay was provoked by the district court decision, that the stay reduces uncertainty for those broadcasters within the state of Nevada or that the stay preserves FCC resources pending appeal. The plaintiffs do argue that because this stay effectively classifies Nevada broadcasters differently than other broadcasters, the plaintiffs have been denied equal protection of the law. The proposed result: a nationwide stay of enforcement pending the appeal of the Valley Broadcasting decision.
The broadcasters ask for application of a strict scrutiny standard to the FCC's decision because it allegedly intrudes on the fundamental right of free speech. This standard would require a compelling interest be served by the FCC restrictions which cannot be served by an alternative and less burdensome means. However, in Dunagin v. City of Oxford, Mississippi, 718 F.2d 738 (5th Cir.1983), the Fifth Circuit specifically rejected the argument that strict scrutiny applies where commercial speech was involved.
Furthermore, in all cases commercial speech is entitled to only a limited measure of protection under a different standard of review. Under the Central Hudson Gas test, the state must demonstrate a substantial interest which is directly advanced by the regulation. If the right to advertise *978 for profits were fundamental, then parties to any particular commercial speech regulation could rely on a stricter standard of review requiring a compelling state interest and necessary means chosen to attain in by locating an unregulated class of advertisers and insisting on an equal protection analysis by the court.
Id., 718 F.2d at 752. The Fifth Circuit continued: "Hence, unlike other areas of First Amendment protection, the commercial speech doctrine is concerned primarily with the level and quality of information reaching the listener." Id. The minimal scrutiny recognized by the Fifth Circuit in commercial speech equal protection cases requires that "the classification challenged need only be rationally related to a legitimate [governmental] interest." Id., 718 F.2d at 753. Without acknowledging Dunagin or this rule, the plaintiffs do alternatively argue that the FCC's stay in Nevada fails even the lesser "rational basis" test.
This Court recognizes the lesser rational basis standard as applicable to the equal protection challenge made in this matter, and finds that the FCC stay easily meets constitutional muster thereunder. For purposes of the lesser standard, the Court finds that the geographically limited FCC stay was rationally designed to accomplish a legitimate government goal.[3]
In addition, however, the Court finds that the FCC stay survives challenge under the stricter challenge applicable to speech entitled to full First Amendment protection. The allegedly offensive stay and resulting classification were based on the order of the district court. Obedience to the orders of the court is surely a compelling interest to all concerned. That obedience is secured by the contempt recognized upon violation. The stay accommodates the broadcasters in the state by providing a measure of certainty of the consequences of any actions. All concerned are spared from the anticipated deluge of individual declaratory actions seeking clarification of the scope of the order which has yet to be declared final.
It is important to note that the stay is temporary in nature and limited in scope. The Nevada district court does not enjoy nationwide jurisdiction; its order is without effect elsewhere. Its order is not final within its jurisdiction until affirmed upon appeal. Yet by virtue of the stay, those within the state of Nevada were served while those persons in all other states, including those states which do outlaw casino gambling, did not have to undergo an unnecessary and perhaps only temporary change of policy. In this regard, it should be noted that the right to unregulated casino advertising was recognized for the first time in Valley Broadcasting. Under the circumstances, the clarity and conservation sought by the government is a compelling interest which could have been accomplished in no other manner that this Court can imagine, and certainly in no other manner suggested by the plaintiffs.
STATUTORY APPLICATION
Next, the plaintiffs argue that casino gaming does not fall within the scope of the statute that empowers the FCC to regulate broadcasted advertising of casino gambling. That statute, 18 U.S.C. § 1304, provides in pertinent part:
Whoever broadcasts by means of any radio or television station for which a license is required by any law of the United States, or whoever, operating any such station, knowingly permits the broadcasting of, any advertisement of or information concerning any lottery, gift enterprise or similar scheme, offering prizes dependent in whole or in part upon lot or chance, or any list of the prizes drawn or awarded by means of any such lottery, gift enterprise, or scheme, whether said list contains any part or all of such prizes, shall be [guilty of an offense against the United States].
(Emphasis added).[4] Specifically, the plaintiffs argue that this statute does not prohibit advertisement concerning casino gambling *979 because casino games cannot be considered a "lottery, gift enterprise or similar scheme."
This argument has yet to receive judicial recognition, failed before the district court in Valley Broadcasting and fails again here. Those things that fall within the coverage of the statute share three characteristics: (1) the distribution of prizes; (2) according to chance; (3) for consideration. F.C.C. v. American Broadcasting Co., 347 U.S. 284, 74 S. Ct. 593, 98 L. Ed. 699 (1954). It is clear that all of those characteristics are enjoyed by casino gambling, regardless of the treatment given by any state enactment.
FIRST AMENDMENT
The parties have grounded their First Amendment arguments on the Central Hudson analysis traditionally applied to restrictions on commercial speech.
In commercial speech cases, then, a four-part analysis has developed. At the outset, we must determine whether the expression is protected by the First Amendment. For commercial speech to come within that provision, it at least must concern lawful activity and not be misleading. Next, we ask whether the asserted governmental interest is substantial. If both inquiries yield positive answers, we must determine whether the regulation directly advances the governmental interest asserted, and whether it is not more extensive than is necessary to serve that interest.
Central Hudson, 447 U.S. at 566, 100 S.Ct. at 2351. For purposes of the first factor, there is no dispute here that the proposed speech would concern lawful activity and not be misleading.
Disagreement sharpens on the second prong of the analysis. The FCC contends that the government has a substantial interest (1) in protecting the interest of nonlottery states and (2) in reducing participation in gambling and thereby minimizing the social costs associated therewith. The United States Supreme Court summarily recognized these interests in 1993 when it analyzed the right of radio stations in nonlottery states to broadcast lottery information in 1993:
As to the second Central Hudson factor, we are quite sure that the Government has a substantial interest in supporting the policy of nonlottery States, as well as not interfering with the policy of States that permit lotteries. As in Posadas de Puerto Rico Associates v. Tourism Co. of Puerto Rico, 478 U.S. 328, 106 S. Ct. 2968, 92 L. Ed. 2d 266 (1986), the activity underlying the relevant advertising gambling implicates no constitutional protected right; rather, it falls into a category of "vice" activity that could be, and frequently has been, banned altogether.
United States v. Edge Broadcasting Co., ___ U.S. ___, 113 S. Ct. 2696, 125 L. Ed. 2d 345 (1993).[5]
The plaintiffs maintain that the government interests cannot be deemed substantial because the number and nature of the statutorily recognized exceptions to the ban on lottery advertising have any alleged government interest existed "totally eviscerated." However, this argument leaves this Court without authority to disregard the Supreme Court's recent and clear message recognizing the substantiality of the government interests claimed here and in Edge Broadcasting.
The last two Central Hudson factors involve the consideration of the fit between the ends and the means chosen by the government. Edge Broadcasting advises that the third factor, whether the regulation directly advances the governmental interest asserted, has a broad focus.
It is readily apparent that this question cannot be answered by limiting the inquiry to whether the governmental interest is advanced directly as applied to a single person or entity. Even if there were no advancement as applied in that manner in this case, as applied to Edge there would remain the matter of the regulation's general application to others in this *980 case, to all other radio and television stations in North Carolina and countrywide.
Edge Broadcasting, ___ U.S. at ___, 113 S.Ct. at 2704. In Edge Broadcasting, the FCC had adopted a policy which permitted licensed broadcasters located in lottery states to broadcast lottery information while prohibiting those located in nonlottery states from such advertising, despite the interstate reach of the airwaves. Again, the Supreme Court found that the FCC regulation directly served the governmental interest in balancing the interests of the lottery and nonlottery states.
Here, the FCC regulations do not prohibit the broadcast of all information concerning casino gambling in Louisiana and Mississippi. Broadcasted advertisement for the state authorized casinos is abundant. The plaintiffs acknowledge that under certain circumstances it is entirely lawful to broadcast casino advertisements. However, advertisements must pertain to the casino's amenities, such as food and rooms. Advertisements cannot promote the gaming aspect of casinos. For instance, under FCC regulations, the word "casino" may be broadcast in an advertisement only if made part of the name of the establishment, but information about certain contests at casinos cannot be broadcast.
The plaintiffs, however, promote the argument that because casino advertising is presented in other non-broadcast media to persons in Louisiana and Mississippi, the FCC prohibitions are ineffective. However, it is equally clear that casino advertising is presented in broadcast media as well, albeit subject to the specific FCC rules. To the extent that the plaintiffs are arguing against the more intrusive regulation of broadcasting, this Court is mindful of the latest reaffirmation from the Supreme Court.
The justification for our distinct approach to broadcast regulation rests upon the unique physical limitations of the broadcast medium.... In addition, the inherent physical limitation on the number of speakers who may use the broadcast medium has been thought to require some adjustment in traditional First Amendment analysis to permit the Government to place limited content restraints, and impose certain affirmative obligations, on broadcast licensees. Red Lion [Broadcasting Co. v. F.C.C.], 395 U.S. [367] at 390, 89 S.Ct. [1794] at 1806-1807 [23 L. Ed. 2d 371]. As we said in Red Lion, "[w]here there are substantially more individuals who want to broadcast than there are frequencies to allocate, it is idle to posit an unbridgeable First Amendment right to broadcast comparable to the right of every individual to speak, write, or publish." Id., 395 U.S. at 388, 89 S.Ct. at 1806; (other citations omitted).
Although courts and commentators have criticized the scarcity rationale since its inception, we have declined to question its continuing validity as support for our broadcast jurisprudence.
Turner Broadcasting System, Inc. v. F.C.C., ___ U.S. ___, ___ - ___, 114 S. Ct. 2445, 2456-2457, 129 L. Ed. 2d 497 (1994). Given the broad scope of this third Central Hudson factor and the continuing validity of enhanced broadcast regulation, the subject restrictions on the advertisement of casino gambling are materially indistinguishable from those which so directly served the government interest in Edge Broadcasting.
The fourth Central Hudson factor does focus on the application of the restrictions in determining whether the regulation is more extensive than necessary to serve the governmental interest. A reasonable fit is required. This requirement is met if the regulation promotes the government interest "provided that it did not burden substantially more speech than was necessary to further the government's legitimate interest." Edge, ___ U.S. at ___, 113 S.Ct. at 2705, citing, Ward v. Rock Against Racism, 491 U.S. 781, 109 S. Ct. 2746, 105 L. Ed. 2d 661 (1989). The validity of the challenged restriction is measured by the relation it bears to the general problem represented by the government interest, not by the extent to which the prohibitions further that interest in an individual case. Id. This Court easily finds that the regulations governing broadcasted casino advertising *981 have been narrowly constructed forpurposes of this last factor.[6]
The plaintiffs argue that each of the subject regulations are a "broad-based, undifferentiating, unrestricted total gag." (Rec.Doc. No. 17, p. 40). However, in light of the prohibitions on casino advertising actually imposed, this characterization is simply not accurate. The fact is that broadcasted casino advertising is permitted, limited by the specific gaming-related limitations now imposed by the FCC. In addition, even if the validity of the restriction was to be measured only as to our broadcasters, the presently imposed restrictions effectively advance the governmental interest in a constitutionally narrow manner.
In effect, the objections to the regulations being made by the plaintiff broadcasters were echoed in Edge Broadcasting and dismissed:
Nor need we be blind to the practical effect of adopting respondent's view of the level of particularity of analysis appropriate to decide this case. Assuming for the sake of argument that Edge has a valid claim that the statutes violated Central Hudson only as applied to it, the piecemeal approach it advocates would act to vitiate the Government's ability generally to accommodate States with differing policies ... Because the approach Edge advocates has no logical stopping point once state boundaries are ignored, this process might be repeated until the policy of supporting [the nonlottery state's] ban on lotteries would be seriously eroded. We are unwilling to start down that road.
Edge Broadcasting, ___ U.S. at ___, 113 S.Ct. at 2701.
In sum, the remaining limitations are reasonably fit to the recognized government interest both in design and in scope for purposes of the Central Hudson evaluation. The remaining restrictions imposed by the FCC are minor and constitutionally valid.
APPLICABLE STANDARD
The Court joins the parties in recognizing the application of Central Hudson to the First Amendment analysis herein. It notes that Edge Broadcasting unhesitantly applied that traditional test to the same statute and similar regulations. However, the Fifth Circuit has recently questioned that application in a commercial speech case where content-based restrictions are involved. MD II Entertainment, Inc. v. City of Dallas, Texas, 28 F.3d 492 (5th Cir.1994). Specifically, the Fifth Circuit referenced R.A.V. v. City of St. Paul, Minnesota, ___ U.S. ___, 112 S. Ct. 2538, 120 L. Ed. 2d 305 (1992), as questioning the general application of Central Hudson to all commercial speech cases.
The Court recognizes the fact that R.A.V. preceded Edge Broadcasting and that Edge Broadcasting did not rely on R.A.V.'s analysis at all. That is extremely persuasive evidence that Central Hudson is the correct standard here. However, because of the suggestion in MD II, the Court will seek the further advice or consensus of counsel.
Accordingly,
IT IS ORDERED that the plaintiffs' motion to strike paragraph four of Greenberg's declaration is DENIED.
IT IS FURTHER ORDERED that counsel advise the Court in writing no later than November 7, 1994, whether issue exists regarding the standard to be applied to the First Amendment analysis.
NOTES
[1] However, in light of recent Fifth Circuit jurisprudence and despite the consensus herein, the Court will ask for further advice regarding the standard applicable to the First Amendment analysis, as explained hereinafter.
[2] An appeal from that decision is pending in the United States Court of Appeals for the Ninth Circuit.
[3] Similarly, the Court finds that the FCC action is not arbitrary, capricious or an abuse of discretion for purposes of review under 5 U.S.C. § 706(2)(A).
[4] 47 C.F.R. § 73.1211 is a substantially similar rule being challenged in this matter.
[5] It should be noted that the district court in Valley Broadcasting found that the government had a substantial interest in exercising their commerce clause powers in a manner cognizant of state choices with regard to gambling, but refused to continue to acknowledge the traditional link between gambling and vice without the benefit of the guidance offered in Edge Broadcasting.
[6] In this regard, the plaintiffs' motion to strike paragraph four of Greenberg's declaration relating to the interstate nature of broadcasting lacks merit. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564464/ | 929 S.W.2d 484 (1996)
Arlon Wayne HOUGH, Appellant,
v.
The STATE of Texas, Appellee.
No. 06-96-00016-CR.
Court of Appeals of Texas, Texarkana.
Submitted July 9, 1996.
Decided August 8, 1996.
*485 Cora Meyer, Carthage, for appellant.
Danny Buck Davidson, District Attorney, Dana R. Whitmer, Assistant District Attorney, Carthage, for appellee.
Before CORNELIUS, C.J., and GRANT and STARR, JJ.
OPINION
CORNELIUS, Chief Justice.
Arlon Wayne Hough appeals his conviction for arson. He contends that he is entitled to a reversal because the State failed to establish the corpus delicti of arson apart from his extrajudicial confession; his confession was involuntary and it led the court to erroneously admit into evidence a photograph obtained as a result of the confession; and the court erred in not granting his motion for new trial because the allegations contained in the indictment materially varied from the proof. We affirm the judgment.
Hough and his estranged wife, Arlene Burnes Hough (now Stevens), were getting a *486 divorce in the summer of 1986. On June 30, Stevens and the couple's child, JonErik Burnes Hough, were spending the night with her parents, Thomas and Lillian "Nancy" Burnes, preparing to move into a mobile home on her parents' property in Panola County. The mobile home was 300 to 400 yards from the parents' house. When Thomas Burnes came home from work about 12:45 a.m. on July 1, he saw the trailer house afire. The trailer and the contents were destroyed.
About a week after the fire, Hough and Stevens spoke by telephone. According to Stevens's testimony, Hough told her that on the night of the fire he looked into her parents' home, saw her and his son, and then entered the mobile home through an air conditioning grate on the floor. He checked to make sure no one was in the trailer, then removed an eight-by-ten framed photograph of JonErik from atop the television set, used a cigarette lighter to ignite the bedspread in Stevens's bedroom in the trailer, and left the trailer through the back door, locking it.
Stevens testified she told Hough to give a statement to the Panola County Sheriff's Department. Hough testified that Stevens told him that if he confessed to the arson, she would reconcile with him and allow him to see his son. He testified she had previously refused to let him have access to his son. Hough made a written statement to officers in which he said he set the fire.
Hough was convicted by a jury. The trial court set his punishment at three years in prison and ordered him to pay $12,756.00 in restitution.
Hough first contends that the trial court should have granted his motion for directed verdict and his motion for new trial because the State failed to prove the corpus delicti of arson apart from his statement.
An extrajudicial confession alone is not sufficient to sustain a conviction. Adrian v. State, 587 S.W.2d 733, 734 (Tex.Crim.App. [Panel Op.] 1979). Evidence that a crime has been committedi.e., the corpus delicti must corroborate the confession. Id.[1]
Corpus delicti means evidence that a crime has been committed by someone, but it does not require proof of the identity of the person. Gribble v. State, 808 S.W.2d 65, 70 (Tex.Crim.App.1990) (plurality opinion on this issue), cert. denied, 501 U.S. 1232, 111 S. Ct. 2856, 115 L. Ed. 2d 1023 (1991).[2] To establish the corpus delicti of arson, the State must produce evidence that someone designedly set the fire. Adrian v. State, supra.
The independent evidence tending to establish the corpus delicti need not be direct, but may be circumstantial. Penry v. State, 691 S.W.2d 636, 648 (Tex.Crim.App. 1985). And while the evidence must relate to the corpus delicti, it need not be sufficient in itself to prove the offense; it need only render the corpus delicti more probable than it would be without the evidence. Emery v. State, 881 S.W.2d 702, 705 (Tex.Crim.App. 1994), cert. denied, ___ U.S. ___, 115 S. Ct. 1257, 131 L. Ed. 2d 137 (1995). It is not necessary that the evidence prove the corpus delicti beyond a reasonable doubt, or even by a preponderance of the evidence; it is only necessary that there be some evidence other than the confession that someone has committed a crime. R.C.S. v. State, 546 S.W.2d 939, 942 (Tex.Civ.App.San Antonio 1977, no writ); see also Thomas v. State, 108 Tex. Crim. 131, 299 S.W. 408 (1927). If there is *487 independent corroborative evidence that, taken in connection with a confession, will convince the jurors beyond a reasonable doubt that the defendant is guilty, the confession is sufficient. Thomas v. State, 299 S.W. at 410. The confession alone may establish the identify of the defendant as perpetrator of the crime. R.C.S. v. State, supra.
Judge Clinton, writing for the Court of Criminal Appeals, suggests that any evidence tending to demonstrate the reliability of the confession will serve as corroboration, even if it does not specifically relate to the corpus delicti. See Wooldridge v. State, 653 S.W.2d 811, 816-17 (Tex.Crim.App.1983).
The opinion in Wooldridge cites for support White v. State, 591 S.W.2d 851 (Tex. Crim.App.1979), overr. on other grounds, Bigby v. State, 892 S.W.2d 864, 874-75 (Tex. Crim.App.1994), cert. denied, ___ U.S. ___, 115 S. Ct. 2617, 132 L. Ed. 2d 860 (1995). A close reading of White, however, suggests that it, too, follows the line of Texas cases requiring that the corroboration relate to the corpus delicti. See, e.g., Self v. State, 513 S.W.2d 832 (Tex.Crim.App.1974); Thomas v. State, supra; and Kugadt v. State, 38 Tex. Crim. 681, 44 S.W. 989 (1898).
In White v. State, supra, three men went to the home of Gladys and Benjamin Coffee for a visit. Mrs. Coffee testified that one of the men expressed interest in the fact that her husband sometimes carried $100 bills in his pocket. Mrs. Coffee testified the men left after she told them her husband no longer carried such sums. Pickup truck tire tracks matching those on a truck driven by one of the men was found at the Coffees' home and at the home of the murder victims, the McKays. Independent evidence showed that someone had searched Mr. McKay's billfold and Mrs. McKay's purse and that no money was found in either the billfold or the purse after the murders. Also, Benjamin Coffee, Mr. McKay's brother-in-law, testified Mr. McKay carried large sums of money in his billfold. The court apparently found this independent evidence was some evidence that a robbery had occurred. Subsequent Court of Criminal Appeals decisions have declined to follow Wooldridge`s purported modification of the corroboration rule. See, e.g., Emery v. State, 881 S.W.2d at 705; Fisher v. State, 851 S.W.2d 298, 302-03 (Tex. Crim.App.1993); Gribble v. State, 808 S.W.2d at 70; and Penry v. State, 691 S.W.2d at 648-49.
The State argues that it proved the corpus delicti by showing that Hough was inside the trailer before the fire. Stevens testified that Hough told her he entered the trailer through an air conditioning grate on the floor. She testified that after the fire the grate was lying near the kitchen where Hough had told her he placed it. The State introduced into evidence a photograph of the grate lying near the kitchen. Also, Stevens testified that immediately before the fire, a framed photograph of JonErik was sitting next to bronzed baby shoes atop the television in the trailer, and that after the fire the fire-damaged bronzed baby shoes remained on the television but the photograph was missing. Hough himself brought the photograph to the Panola County sheriff's office at a deputy's request after he had been released on bail. Hough testified that he had stolen the photograph from the trailer some days before the fire.
The State introduced some evidence suggesting that the gas had not yet been connected to the trailer. This fact, if true, would make an accidental gas fire less likely.
The police officers said they investigated the fire as an arson case, and the fire investigator testified that he investigated the fire as a "case involving arson."
The State also introduced independent evidence that the fire started in the bedroom while Stevens was not at home.
Hough argues that there was no evidence, apart from his statement, that the trailer fire was set by anyone. He relies primarily on Adrian v. State, supra; Bussey v. State, 474 S.W.2d 708 (Tex.Crim.App.1972); and Massey v. State, 154 Tex. Crim. 263, 226 S.W.2d 856 (1950). In Adrian v. State, supra, the State introduced no independent evidence about the fire's cause, did not negate the possibility of accidental causes, and did not show that the defendant was in the dwelling before the fire. Here, the State introduced evidence that Hough was in the trailer shortly *488 before the fire and that the gas was not connected. In Bussey v. State, supra, no one testified about the cause of the fire or gave an opinion about the cause. The court there did say the defendant's motive and proximity to the fire were not sufficient to support the conviction, but no one placed the defendant in the dwelling before the fire, only near the dwelling. In Massey v. State, supra, an insurance investigator testified that an accelerant had been placed on the floor, but that the fire had started elsewhere. Here the State introduced independent evidence that the fire started in the bedroom when Arlene Stevens was not at home.
Although the evidence in this case may not be sufficient to independently prove the corpus delicti apart from the confession, it renders the corpus delicti more probable than it would be without the evidence. Thus, we find sufficient circumstantial evidence to establish the corpus delicti.
Hough also contends that the court erred in admitting his statement in evidence because it was involuntary.
Hough testified that he completed only the ninth grade and had difficulty reading and writing. He said he gave his written statement to sheriff's deputies because his wife told him that if he confessed to setting the fire she would get back together with him and would allow him to see his child.
Chief deputy John DePresca and deputy J.B. Jones testified that Hough was read his Miranda[3] rights before talking to deputies and that they made no promises in exchange for his statement.
The State may use in evidence a statement by the accused if he gave the statement freely and voluntarily without compulsion or persuasion. Tex.Code Crim. Proc. Ann. art. 38.21 (Vernon 1979). When the accused raises the issue of the statement's voluntariness, the court must hold a hearing to determine whether the statement was voluntarily given. Tex.Code Crim. Proc. Ann. art. 38.22, § 6 (Vernon 1979); Jackson v. Denno, 378 U.S. 368, 84 S. Ct. 1774, 12 L. Ed. 2d 908 (1964). The court did so in this case.
The determination of whether a statement is voluntary must be based on an examination of the totality of the circumstances surrounding its acquisition. Armstrong v. State, 718 S.W.2d 686, 693 (Tex. Crim.App.1985). The ultimate question is whether the State has overborne the defendant's will. Id. The United States Supreme Court has held that a promise is a factor to take into account in applying the general due process "totality of the circumstances" analysis, Arizona v. Fulminante, 499 U.S. 279, 285-88, 111 S. Ct. 1246, 1251-53, 113 L. Ed. 2d 302, 315-17 (1991), and Texas law has long barred the use of a statement induced by a promise of someone in authority. Warren v. State, 29 Tex. 369, 372 (1867). A statement is involuntary and thus inadmissible if it is induced by a promise that is (1) of some benefit to the defendant, (2) positive, (3) made or sanctioned by someone in authority, and (4) of such character as would likely influence the defendant to speak untruthfully. Sossamon v. State, 816 S.W.2d 340, 345 (Tex.Crim.App.1991).
Hough testified that he confessed to sheriff's deputies because Stevens told him that if he did she would reconcile with him and would give him access to their son. Stevens and her mother, who listened in on the phone conversation, agree that Stevens promised to reconcile with Hough if he confessed. Stevens testified, however, that Hough told her he set the fire before she said anything about a reconciliation.
The State argues that even if Stevens promised to reconcile, the promise did not meet the fourth prong of the test because Hough confessed before Stevens promised the reconciliation. The State also argues that, in any event, the promise did not invalidate the confession because it was not made or sanctioned by anyone in authority and thus fails to meet the third prong of the test. DePresca, Jones, and Stevens all testified that the deputies did not tell Stevens to make the promise, although DePresca testified that he may have told her that an arson conviction is difficult to get unless someone confesses.
*489 Although Hough included in his written statement, "My wife told me she would drop the charges," DePresca testified that he did not recall discussing this line with Hough and did not recall telling Hough that Stevens had no authority to drop the charges.
Stevens was not a person in authority, and there is sufficient evidence to support a conclusion that no one else in authority sanctioned any promise by Stevens to Hough. Thus, the statement was not rendered involuntary by any such promise.
Hough also contends that the court erred in admitting into evidence a photograph obtained as a result of the confession. We have found that the confession was not involuntary and thus not improper. It follows that the photograph was not improperly admitted.
Hough also contends that the trial court should have granted him a new trial because the allegations contained in the indictment materially and fatally varied from the proof the State offered.
A person commits an offense if he starts a fire or causes an explosion with intent to destroy or damage a habitation knowing that it is on property belonging to another. Tex. Penal Code Ann. § 28.02 (Vernon 1994).
The indictment charged that Hough "did then and there intentionally start a fire and cause an explosion by setting a fire inside a building by placing a flame to combustible material in one of the rooms of said building" (emphasis added).
When an offense may be committed in more than one way, the indictment may allege alternative methods of committing an offense. Nickerson v. State, 782 S.W.2d 887, 891 (Tex.Crim.App.1990). When the methods are alleged conjunctively, proof of any of those alleged in the indictment will support a conviction. Rogers v. State, 774 S.W.2d 247, 251 (Tex.Crim.App.), cert. denied, 493 U.S. 984, 110 S. Ct. 519, 107 L. Ed. 2d 520 (1989); see also Marvin Collins & Candyce Howell, State Law of Indictments, Texas Criminal ProcedureCode and Rules at [29] (West 1995).
Deputy DePresca testified that Hough lit the fire with a Bic-style lighter and that "flicking a Bic" was an explosion. DePresca also testified that apart from "flicking a Bic" there was no evidence of an explosion. But even if the lighter's ignition did not constitute an explosion, the State was not required to prove that Hough caused an explosion, because proof that he started the fire is sufficient to support the conviction. The State was permitted to allege in the indictment alternative methods of committing arson. Proof that Hough committed arson using one of the alternative methods, starting a fire, is sufficient to support the conviction.
For the reasons stated, the judgment is affirmed.
GRANT, Justice, dissenting.
I respectfully dissent. The fact that a building is destroyed by fire does not show that the crime of arson was committed by anyone, in that there must be evidence that the fire was incendiary in origin. Faulk v. State, 608 S.W.2d 625 (Tex.Crim.App.1980). As stated in Adrian v. State, evidence that a crime has been committed must corroborate the confession. 587 S.W.2d 733, 734 (Tex. Crim.App. [Panel Op.] 1979).
I would like to reexamine the evidence cited by the majority as corroborating the defendant's statement to show that a crime had been committed, more specifically that someone designedly set the fire.
The majority opinion apparently relies upon the fact that gas had not been connected to the trailer to show that an accidental gas fire was not likely, but there was no suggestion in this case that the fire was gas-related. This evidence by no means eliminates other possible causes, such as defective electrical wiring, spontaneous combustion, or any other causes not incendiary in origin. See Adrian, 587 S.W.2d at 733; Burrow v. State, 481 S.W.2d 895 (Tex.Crim.App.1972). The evidence that the gas was not hooked up does not render it more likely that it was an incendiary fire than a fire from another origin.
Next, the majority cites evidence that someone had been in the trailer within a few hours before the fire. It has been held that motive and opportunity alone are not sufficient *490 to establish that an accused set fire to a building, but there must be some testimony showing that the fire was incendiary in origin. Massey v. State, 154 Tex. Crim. 263, 226 S.W.2d 856 (1950). The presence of an unauthorized person in the trailer would indicate the crime of breaking and entering, but it does not show that anyone intentionally set fire to the trailer, nor does it render more likely that the fire was caused by a person rather than other causes. A fire could start from defective electrical wiring or other sources whether or not a person was present in the trailer.
The majority points to the fact that there had been an arson investigation. The mere fact that there was an investigation is not a circumstance that shows one way or another the probability of the occurrence of arson, especially since none of the investigators offered any evidence in any form that would suggest that the fire was incendiary.
None of the evidence offered by the State corroborates the corpus delicti. Other parts of the confession are corroborated, but under Texas law, there must be evidence corroborating the corpus delicti. (See majority opinion and the cases cited therein.)
The State argues in this case that if the corpus delicti was not properly corroborated, this court should reexamine the corpus delicti rule. I agree that this rule should be reexamined, but the Court of Criminal Appeals is the appropriate forum for such a change. The federal system no longer follows the rule requiring corroboration of the corpus delicti, but instead requires only substantial independent evidence that establishes the trustworthiness of the defendant's statement. United States v. Kerley, 838 F.2d 932, 939-40 (7th Cir.1988) (citing Opper v. United States, 348 U.S. 84, 75 S. Ct. 158, 99 L. Ed. 101 (1954)).
In the present case, the evidence substantially supports the trustworthiness of the statement, but the evidence does not corroborate that this fire was of incendiary origin.
For that reason, I respectfully dissent.
NOTES
[1] The corroboration rule in England appeared in two variations: (1) that the corroboration might be of any sort whatever and (2) that it must specifically relate to the corpus delicti. Wigmore on Evidence § 2070 (3d ed.1940). Most jurisdictions in this country have adopted a rule requiring corroboration, but some did not limit the corroboration to evidence concerning the corpus delicti, that is, the corroborating evidence may be of any sort whatever, providing it tended to produce a confidence in the truth of the confession. Wigmore on Evidence § 2071 (3d ed.1940).
[2] Professor Wigmore suggests that each crime has three component parts: (1) the occurrence of an injury or loss; (2) someone's criminality as a source of the loss, that is, rather than an accident; and (3) the accused's identity as the doer of the crime. The corpus delicti originally may have referred only to the first element, that is, whether a loss has been sustained, but in later years, most courts included the second element, someone's criminality. Wigmore on Evidence § 2072 (3d ed.1940).
[3] Miranda v. Arizona, 384 U.S. 436, 86 S. Ct. 1602, 16 L. Ed. 2d 694 (1966). | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564487/ | 16 So. 3d 992 (2009)
Debra WHITE, Appellant,
v.
BASS PRO OUTDOOR WORLD, LP, and Travelers Insurance Company, Appellees.
No. 1D08-1367.
District Court of Appeal of Florida, First District.
August 26, 2009.
*993 A. Scott Gow and Brooke Perez of Law Offices of Steven Slootsky, P.A., Fort Lauderdale, for Appellant.
Lourdes Ferrer of Conroy, Simberg, Ganon, Krevans, Abel, Lurvey, Morrow & Schefer, P.A., Hollywood, for Appellees.
HAWKES, C.J.
Claimant seeks reversal of an order of the Judge of Compensation Claims (JCC) arguing the JCC abused her discretion by rejecting the opinion of an authorized orthopedist. We disagree, and affirm.
In this case, two differing medical opinions were submitted to the JCC regarding the major contributing cause (MCC) of Claimant's knee injury. Claimant's treating orthopedist opined the MCC of Claimant's knee injury was her workplace accident. The employer/carrier (E/C) obtained an independent medical examiner (IME) who originally agreed with Claimant's orthopedist, but changed his opinion after reviewing medical records that clearly demonstrated a prior problem with the knee. Because the records were inconsistent with the history Claimant provided, the IME ultimately opined the evidence was too inconclusive for him to render an opinion on MCC within a reasonable degree of medical certainty.
The JCC rejected the opinion of Claimant's treating physician, as was her prerogative, see City of West Palm Beach Fire Department v. Norman, 711 So. 2d 628, 629 (Fla. 1st DCA 1998), and denied compensability of the knee condition. Claimant contends, however, the reasons provided by the JCC for rejecting the "uncontroverted" medical opinion of the treating physician were unreasonable and, thus, impermissible.
We note that a JCC may reject evidence, even uncontroverted testimony, which he does not believe. See Ullman v. *994 City of Tampa Parks Dep't, 625 So. 2d 868, 873 (Fla. 1st DCA 1993) (en banc). Nevertheless, here, we disagree with Claimant's premise that the opinion of the treating physician was uncontroverted. Although the E/C's IME did not contradict the treating physician's opinion to the extent that a more preponderant cause of Claimant's knee injury was identified, the IME's opinion did establish a medical foundation for questioning the medical validity or weight of the treating doctor's opinion.
Here, the JCC, after reviewing the entirety of the evidence, was simply not persuaded that, within a reasonable degree of medical certainty, the MCC of Claimant's knee injury was the workplace accident. This finding is supported by record evidence. Under such facts, the JCC was not required to provide a reason for rejecting the opinion of the treating physician, other than to state that the opinion of the treating physician was not sufficiently persuasive. See Mitchell v. XO Commc'ns, 966 So. 2d 489, 490 (Fla. 1st DCA 2007) (stating claimant must present evidence JCC finds persuasive); see also Socolow v. Flanigans Enters., 877 So. 2d 742, 743 (Fla. 1st DCA 2004) ("To uphold an order granting or denying workers' compensation benefits, a reviewing tribunal need only determine that the record contains competent substantial evidence supporting the JCC's conclusion; the JCC is not required to explain why he or she disregarded contradictory evidence."); Chavarria v. Selugal Clothing, Inc., 840 So. 2d 1071, 1078-79 (Fla. 1st DCA 2003) (en banc) (stating the JCC need not explain precisely why he accepts testimony of one witness and rejects another as long as it does not appear he ignored or overlooked contrary testimony).
In a workers' compensation proceeding, the JCC is the finder of fact, who, like the juries of this state, is given broad fact-finding powers. A fact-finder may accept or reject an expert's testimony, or give it the weight deserved considering the knowledge, skill, experience, training, or education of the witness, the reasons given by the witness for the opinion expressed, and all other evidence in the case.
Based on the record before us, we find no error in the JCC's rejection of the opinion of Claimant's treating orthopedist and AFFIRM the order on appeal.
LEWIS and THOMAS, JJ., concur. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564521/ | 929 S.W.2d 725 (1996)
55 Ark.App. 57
Teresa O'NEAL, Appellant,
v.
Robert Wesley O'NEAL, Appellee.
No. CA 95-1135.
Court of Appeals of Arkansas, Division III.
October 2, 1996.
J. Patrick McCarty, Fort Smith, for appellant.
Annie Powell, Fort Smith, for appellee.
PITTMAN, Judge.
The appellant, Teresa O'Neal, and the appellee, Robert Wesley O'Neal, were married in October 1993. The final divorce decree, entered June 28, 1995, provided in part that $35,000.00 that appellee received from his employer, Smith Barney, be characterized as deferred compensation and nonmarital in character. Teresa O'Neal appeals this finding and the denial of her motion for continuance. We affirm.
Appellant first argues that the chancellor erred in ruling that the moneys appellee received were nonmarital property.
*726 Chancery cases are reviewed de novo on appeal, but the appellate court will not disturb the chancellor's findings unless they are clearly erroneous or clearly against the preponderance of the evidence. Jones v. Jones, 43 Ark.App. 7, 858 S.W.2d 130 (1993).
Appellee changed jobs after the parties were separated but before the divorce decree was entered. At the time of the final divorce hearing, appellee had a right to but had not received the $35,000.00 from his new employer, Smith Barney. Appellee said that he signed an employment contract with Smith Barney on April 21, 1995, prior to the final divorce hearing on May 10, 1995. His employment contract provided that he would receive a $35,000.00 advance as compensation during the period of job transition and as he developed clientele. Appellee said that to avoid repaying the money, he had to be employed by Smith Barney a minimum of four years.
Clifton Ladd, a Smith Barney manager, testified that the money was a "forgivable loan," with twenty-five percent of the loan being forgiven for each year that appellee remained through the four years. Ladd testified that the forgiven portion of the loan becomes taxable income to appellee and that the loan was part of appellee's compensation package.
Appellant argues that the $35,000.00 is marital property because appellee had access to it prior to entry of the divorce decree. It is true that assets acquired after separation and prior to divorce are marital property. Cavin v. Cavin, 308 Ark. 109, 823 S.W.2d 843 (1992). In considering whether property is marital, the determining factor is the time that the right to the property is acquired. Dunn v. Dunn, 35 Ark.App. 89, 811 S.W.2d 336 (1991). Here, even though appellee acquired the right to the $35,000.00 during the marriage, he did not earn it during the marriage. The testimony was that the money was compensation for future services and contingent on appellee's future performance; thus, it was not earned during the marriage and is not marital property. See Wilson v. Wilson, 294 Ark. 194, 741 S.W.2d 640 (1987); Dunn, supra; Dillard v. Dillard, 28 Ark.App. 217, 772 S.W.2d 355 (1989). The court's determination that the money was advanced compensation and not marital property is not clearly erroneous.
Next, appellant argues that it was error to deny her motion for continuance. The parties separated in March 1995, and a final hearing was set for May 10, 1995, because the initial trial setting of May 16, 1995, created a schedule conflict for appellant's counsel. Appellant's attorney agreed to the expedited trial date conditioned on appellee's attorney timely supplying information requested in interrogatories which appellant served on appellee on April 4, 1995. Appellee responded on May 5, 1995. Appellant moved for a continuance based on new information revealed in the interrogatories regarding appellee's not yet received $35,000.00 payment. Counsel renewed his motion at the beginning of the May 10 hearing, and the court denied it stating that "if it develops that we need more information, more fully developed, then we will make arrangements for that to occur." Appellant testified that she did not have enough information regarding her interest in the money. During the trial the money was discussed at length; however, appellant's counsel never requested further information nor renewed the motion for continuance.
Whether to grant a continuance to allow further discovery is a matter within the trial court's discretion. Alexander v. Flake, 322 Ark. 239, 910 S.W.2d 190 (1995). For this court to reverse the denial of the continuance, appellant must show that the trial court abused its discretion and that the additional discovery would have changed the outcome of the case. Id. Because all of the evidence before the court conclusively demonstrated that the money was compensation for future services, we cannot determine that the court abused its discretion in denying a continuance or that appellant demonstrated that additional discovery would have changed the outcome.
Appellee, alleging that appellant's abstract failed to comply with the appellate rules, asks for an award of costs for preparation of *727 a supplemental abstract. We find no merit in this argument, and the motion is denied.
Affirmed.
JENNINGS, C.J., and HAYS, Special Judge, agree. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564526/ | 76 F.2d 785 (1935)
SNEED
v.
PHILLIPS PETROLEUM CO. et al.
BRITAIN
v.
SHAMROCK OIL & GAS CO. et al.
HENRY SCHAFER, Inc.,
v.
HAGY et al.
Nos. 7548-7550.
Circuit Court of Appeals, Fifth Circuit.
March 28, 1935.
No. 7548:
H. L. Adkins and Chas. H. Keffer, both of Amarillo, Tex., for appellant.
Don Emery and R. K. Batten, both of Amarillo, Tex., and W. P. Z. German and Alvin F. Molony, both of Tulsa, Okl., for appellees.
No. 7549:
S. A. L. Morgan and D. H. Culton, both of Amarillo, Tex., for appellant.
Joseph B. Dooley and C. C. Small, both of Amarillo, Tex., and Maurice Cheek and Burney Braly, both of Fort Worth, Tex., for appellees.
No. 7550:
William Jarrell Smith, of Pampa, Tex., for appellant.
Joseph B. Dooley and C. C. Small, both of Amarillo, Tex., and Maurice Cheek, of Fort Worth, Tex., for appellees.
Before SIBLEY, HUTCHESON, and WALKER, Circuit Judges.
HUTCHESON, Circuit Judge.
These are appeals from orders dismissing, for want of equity, bills seeking injunctive relief. Each of the bills in these cases, though brought by a different plaintiff in relation to different properties, and charging different defendants, advances the same ideas, makes the same charges, asks the same relief. The general idea advanced is that adjoining owners and operators of gas lands in a common pool, that is, one subject to common drainage, have an equity against each other to restrain the taking of gas from the pool for wasteful uses. The particular idea advanced in each bill is that by the Texas Conservation Laws the taking of gas to strip it for gasoline is a wasteful use, and that the plaintiff in each case has a right to restrain the defendants in each from doing so. The charges are that, though required by the act and by the Conservation Laws of Texas to close their wells until their gas may be used for light and fuel, defendants, in reliance upon invalid amendments to those laws, and upon permits of the Railroad Commission, the statutory conservation agent, issued under their purported authority, have opened their wells and are using their gas to strip gasoline from it, and blow the residue into the air, a process which avails of about 3 per cent. of the heat units and wastes the balance. The bills charge that this wasteful use is causing plaintiffs irreparable injury, in that the gas in the pool is being used up faster than it would be if used for light *786 and fuel, and particularly that it is causing the gas to migrate from plaintiffs' lands on to defendants', and into defendants' wells, to be wasted by being blown away, whereas but for such wasteful and unlawful uses it would remain in place to be utilized non-wastefully and in accordance with law. The relief the bills seek is injunctive, restraining defendants from flowing their wells except to utilize the gas for light or fuel.
After alleging, as to Sneed, that he owns the oil, gas, and other minerals subject to a gas lease, under 300 acres of land, from which it is alleged one of the defendants is taking gas for stripping, and also is the owner of 7,500 acres of land lying to the west, north, and south of this tract, all subject to leases; as to Britain, that he owns an undivided interest in minerals, subject to a gas lease, in approximately 6,000 acres of land; as to Schafer, Inc., that it owns gas and minerals under about 8,000 acres of land, and that all of these lands are located within the Panhandle Gas Reservoir, a huge body of land embracing approximately 1,350,000 square miles, with a width of 10 to 15 miles, and a length of more than 125 miles, the bills launch into a vivid description of conditions and activities there. Concerning themselves not only with the particular actions of the defendants, and the effect of those actions on plaintiffs, but with the entire situation in the huge Panhandle field, its effect on and relation to the state's general policies of conservation, the bills present a graphic picture of alleged wasteful uses under purported legislative and Commission authority. The picture is so graphic as to general conditions and as to the general interests involved as almost to dwarf and make insignificant the private interests of plaintiffs, and the particular activities of defendants against which they ask relief. They allege that all of the lands in this reservoir are capable of producing gas, and that large portions of them are known to be productive of oil.[1] The bills allege that plaintiffs' lands are so situated on the structure that they are underlaid with formations capable of producing not only sweet gas in large quantities, but also great quantities of oil. That conditions in the industry have heretofore prevented the development of these lands, but in due course they will be developed and plaintiffs will realize large returns from the oil and gas under them, if they are developed in an orderly and lawful way. It is alleged that the reservoir originally contained 13,000,000,000,000 cubic feet of natural gas, and about 1,000,000,000 barrels of oil. That of the oil less than 200,000,000 barrels have been produced down to the present date and that if the present rate of withdrawals of natural gas goes on, 400,000,000 barrels of oil which could otherwise be recovered, will be lost to the owners. Of the gas originally contained in the field approximately 4,000,000,000,000 cubic feet, or one third of it, has already been produced, the greater part of it from localities wastefully developed for oil, producing numerous low pressure areas. That originally the reservoir pressure was about 430 pounds per square inch, but as the result of withdrawals the equilibrium of the pressure has been disturbed, and a gradual but steady migration from higher to lower areas has been going on, with the result of pulling down the reservoir pressure and reducing the volume of gas content in the formation. In many places, by reason of such withdrawals, the pressure is below 200 pounds. Of the total volume of gas withdrawn, more than three-fourths of it has been produced in a ruthlessly wasteful manner and only a small portion produced for light and fuel. An enormous quantity of it has been produced and permitted to escape into the air from the mouths of wells. A substantial portion of it has been produced to strip it of its natural gas content and burn the residue into carbon black. The remainder, aggregating more than half of the total gas produced, has been wasted into the air after being stripped of its small natural gasoline content, less than 3 per cent. of the heat producing value of the gas. At the present time more than 1,600,000,000 cubic feet of gas is being produced daily, less than 400,000,000 of this for light and heat. Of the remainder four to over five hundred million is burned into carbon black after its small gasoline content has been extracted, more than one half, that is, 600,000,000 cubic feet is being stripped of its natural gasoline content and wasted into the air. "At the present rate of withdrawals the tremendous losses of natural gas and oil that will result from the wasteful dissipation of the natural gas contained in the reservoir will reach *787 such staggering proportions as to amount to nothing less than a public calamity." That in a short time plaintiffs' lands will be drained of a large part of their gas; that the defendants, though they have already produced substantially all of the gas contained under their formations, are engaged in wasting the gas in the pool by stripping operations, drawing the gas from plaintiffs' lands into theirs.
Of the particular defendants it is alleged that defendant Phillips owns a lease on a 300-acre tract of plaintiff Sneed's land, and through two wells on it is producing gas in large quantities. Skelly owns a lease on land immediately east of plaintiff Sneed's lands, and is producing gas from wells on it. Several of these wells are located very close to his land. This gas, approximately 20,000,000 cubic feet daily, is transported to a natural gasoline plant where its gasoline content, .29 gallon per thousand cubic feet, is taken out and the balance wasted. That, though he has been receiving royalty on this gas, these royalties are insignificant, besides, the gas withdrawals are endangering his oil recovery, and he is not willing for such wasteful uses to continue. Defendant Shamrock owns a lease on 80 acres, on which a well drilled at a point 770 yards from Britain's land, is producing 7,000,000 cubic feet of gas daily. Defendant Continental is the owner of a lease on 160 acres, on which it has drilled a well 440 yards from plaintiff Britain's land. This well is producing about 5,000,000 cubic feet. Schafer owns approximately 9,000 acres, which land has been partially though not fully, developed. Defendant Hagy and others have four gas wells, three each on 80 acres, and one on 160 acres. They are located near Schafer's land and so located that enormous quantities of gas have been drawn from plaintiff's lands to their wells.
Anticipating defendants' claim of authorization, plaintiffs allege that the defendants base their claim of right to use this gas on a proviso, added to article 6008 of the Revised Statutes of Texas, by an Act of the 43d Legislature, c. 100, § 1, reading: "In all common reservoirs or pools consisting of more than three hundred thousand (300,000) acres where gas is encountered for which there is no reasonable market for light or fuel available to the owner, the same may be utilized for other purposes, including the manufacture of natural gasoline, to the extent of twenty-five (25) per cent. of the open flow of the well producing such gas"; and on permits issued by the Railroad Commission of Texas, under a proviso added to article 6008 by an Act of the First Called Session of the same Legislature (chapter 88, § 1 [Vernon's Ann. Civ. St. Tex. art. 6008]), that: "The Commission may permit the use of gas from any well producing natural gas only for the purpose of being introduced into an oil or gas bearing stratum in order to maintain or increase the rock pressure or otherwise increase the ultimate recovery of oil or gas from such stratum and for any other purpose which under circumstances surrounding each particular case might be found by the Commission after hearing to be practical and conducive to the public welfare."
Plaintiffs deny the right of defendants to strip gas under the first proviso: (a) Because while purporting to be a general law, it is a local and special law, operating only in the Panhandle, and in violation of the state Constitution forbidding the passage of any local or special law regulating labor, trade, mining, and manufacture. (b) The proviso discriminates against the owners of natural gas in that reservoir by permitting wasteful uses there, while not permitting them elsewhere, and therefore is in violation of the Fourteenth Amendment. (c) It is arbitrary and void because it permits wasteful uses in the Panhandle field while prohibiting them in other places. (d) It is void because vague and indefinite in allowing utilization of gas for other purposes, including stripping, where "there is no reasonable market available to the owner." (e) It is in violation of article 16, § 59a, Conservation Amendment to the Constitution of Texas, enjoining the Legislature to enact laws to conserve the state's natural resources. (f) If valid, what it means to say is that persons may not strip gas until they have expended money and done everything possible to create a market for light and fuel, and it was not intended, in any event, to permit the stripping of the gas and the blowing of the residue into the air. They deny that the permits from the Commission are effective: (a) Because the proviso is void as a delegation of legislative authority to the Commission, in that it authorizes the Commission generally to determine what uses shall be made of gas, instead of making fact findings as the basis for applying standards fixed by the Legislature. (b) That the proviso undertakes to confer upon the Commission power to suspend the general provisions of article 6008, as amended, requiring gas to be confined to wells until it can be used for *788 light and fuel. (c) The proviso is in violation of article 16, § 59a, of the state Constitution. (d) If valid, it may not be construed as authorizing the use of gas for stripping operations as now conducted.
In Britain's Case, there was a motion to dismiss for want of indispensable parties, the lessors of defendants and the cotenant of plaintiff. There was a motion, too, to dismiss the entire bill for want of equity on these grounds:
(1) Plaintiff's bill does not show that he is in any way hampered or restrained by the statute and the Commission permits under which defendants are operating, for all that appears plaintiff can do with his gas just what defendants are doing. (2) Plaintiff's attack upon the statute is a collateral attack upon the legislative policy of the state, and that upon the permits a collateral attack upon the findings and orders of the Commission. (3) Plaintiff's bill seeks a futile and useless thing, but one greatly prejudicial to defendants, in that it seeks to prevent defendants from producing 5,000,000 cubic feet of gas a day from a common pool, from which, on plaintiffs' allegations, more than 1,600,000,000 cubic feet are being daily produced and the most of it wasted, including 1,000,000,000 daily for uses other than for light and fuel, for stripping gasoline, and manufacturing carbon black. To restrain defendants from this small production will not substantially aid plaintiffs, but will deprive defendants, who are without markets for light and fuel, of the use and value of their property, by restraining them from doing what, under express statutory authority, is being generally done by property owners in the field. The defendants in Schafer's Case and in Sneed's made substantially the same motions, with this additional point in Sneed's Case, that he was estopped to complain because his bill shows that he has accepted from the defendants whom he sues, royalties for the uses complained of.
The District Judge thought defendants' point as to parties well taken, but because he thought that the fundamental want of equity on the face of plaintiffs' bills was plain, and that new parties would not mend it, he considered and sustained the motion to dismiss on the merits. In doing so he filed an opinion in which he held in substance: "With reference to the 300,000 acre proviso, (a) that such proviso is neither a local nor a special law under the Texas Constitution. (b) That the statute as amended is not discriminatory; the classification in it is reasonable. (c) As amended, it is not vague and indefinite, with reference to the meaning of the term `Reasonable market value for light and fuel available to the owner,'" and the term "utilized for other purposes, including the manufacture of natural gasoline." (d) Article 16, § 59a, the Conservation Amendment, is not self-enacting; but in so far as private property is concerned, it leaves the conservation policy of the state in the hands of the Legislature. (2) With reference to the permit proviso: (a) The statute as amended does not delegate legislative powers to the Commission, or authorize the Commission to suspend laws. (b) The Commission permits are in harmony with the policy in Texas concerning conservation of natural gas. (c) The court cannot substitute its judgment for that of the Commission in determining whether this use of the gas is conducive to public welfare. (3) Since plaintiffs' properties are located in the area to which the statute as amended relates, and they are affected equally with defendants by the statute, they may not complain of it as discriminatory because of its effect upon persons owning property in areas not affected by the amendments. (4) The fact that plaintiff, Sneed, is being paid a royalty on the gas produced from his 300-acre tract presents an insurmountable difficulty in the way of his obtaining any relief. This appeal is from the order dismissing the bills on the merits. All of us think the District Judge was right in the view he took that the presence of additional parties was indispensable to plaintiffs' obtaining the relief they ask. Northern Indiana R. Co. v. Michigan Central R. Co., 15 How. 233, 14 L. Ed. 674; McConnell v. Dennis (C. C. A.) 153 F. 547; Niles-Bement-Pond Co. v. Iron Moulders' Union, 254 U.S. 77, 80, 41 S. Ct. 39, 65 L. Ed. 145; Shields v. Barrow, 17 How. 130-139, 15 L. Ed. 158.
A majority of this court are of the opinion that the District Court, before proceeding to consider the merits of the case, either in law or in fact, should have required the making of these parties and given opportunity therefor. The majority are of the opinion that the questions at issue above pointed out are of such difficulty and intricacy and some of them of such doubtfulness that they should be decided only after hearing every party interested, and with them all present in court so as to be bound by the decision, whatever it may be. They therefore hold that the case should be reversed, with directions to make the parties, no obstacle thereto appearing.
*789 The writer thinks the District Judge was right, too, in concluding that there was a fundamental want of equity in the bills which the making of new parties could not cure, and that he was right in dismissing them on their merits for that want. Because he thinks the case was well decided, and that to send it back for new parties will be doing a vain thing, the writer will, in a separate opinion, give briefly his reasons for believing that the decree should be affirmed.
Reversed and remanded for other and not inconsistent proceedings.
HUTCHESON, Circuit Judge (dissenting).
I cannot agree with my associates that the absence of indispensable parties requires the reversal of this decree. Such an objection does not go to the court's jurisdiction as a federal court to hear a cause. Elmendorf v. Taylor, 10 Wheat. 152, 6 L. Ed. 289;[1] Hazeltine Corp. v. White (C. C. A.) 68 F. (2d) 715; Dyer v. Stauffer (C. C. A.) 19 F. (2d) 922; General Inv. Co. v. N. Y. Central R. Co., 271 U.S. 228, 46 S. Ct. 496, 70 L. Ed. 920; Rose v. Saunders (C. C. A.) 69 F.(2d) 339; Edenborn v. Wigton (C. C. A.) 74 F.(2d) 374. It goes to the equity of its proceeding in it. It operates to prevent affirmative action which will adversely affect the rights of absent parties. Com. of Pennsylvania v. West Virginia, 262 U.S. 553, 43 S. Ct. 658, 67 L. Ed. 1117, 32 A. L. R. 300; authorities main opinion, supra. It never operates as a technical rule to prevent action which is not to the prejudice of such parties. When, as here, it appears on the face of the record that the making of additional parties will not mend the fundamental defects of a bill, that, should new parties be made, the jurisdiction invoked will not be exerted against them, a court will not make the empty gesture of requiring new parties to be made. It will, by an opinion on the merits, bring the litigation to an end.
My associates think the questions presented for decision are so difficult and doubtful that they ought not to be decided except in a case to which all concerned are parties. I do not think so. It seems to me perfectly plain that the propositions the District judge advanced in support of the opinion he gave are sound, and well supported by authority. Because I agree in the main with what he said, this opinion will not be greatly extended.
I think that plaintiffs' arguments, powerful and searching as they are, proceed to incorrect conclusions, because based upon a series of incorrect assumptions. The first is that, apart from legislative provisions, the use defendants are making of their land, by taking the gas from it, is a wasteful one and may be enjoined. This assumption is, I think, contrary to the settled law of Texas regarding the taking of oil and gas. That law is, an owner of oil or gas lands may take oil or gas from them, at least for any beneficial use, and the use here is certainly a beneficial one, in any quantity without being subject to judicial restraint at the suit of other land owners. Texoma Natural Gas Co. v. Terrell (D. C.) 2 F. Supp. 168, 170; Ehlinger v. Clark, 117 Tex. 547, 8 S.W.(2d) 666, 667; Hunt v. State (Tex. Civ. App.) 48 S.W.(2d) 466; Champlin Ref. Co. v. Corp. Comm., 286 U.S. 210, 52 S. Ct. 559, 76 L. Ed. 1062, 86 A. L. R. 403; Henderson, Inc., v. Railroad Comm. (D. C.) 56 F.(2d) 218, unless he takes it by methods which negligently or wantonly damage or destroy adjoining lands or structures. Comanche Duke Oil Co. v. Texas P. Coal & Oil Co. (Tex. Com. App.) 298 S.W. 554, 556.
In the light of this settled rule of law, I think it cannot be maintained that a court of equity will interfere at the suit of one owner, to prevent the beneficial, though it may be uneconomical, use by another owner, of gas or oil drawn from his land by proper drilling and production methods.
The second erroneous assumption on which plaintiffs' arguments proceed is that the statutes of Texas do now, or ever did, restrain the owner absolutely and at all events from using gas drawn from his wells except for light and fuel. I think this assumption proceeds from an incorrect reading and apprehension of article *790 6008. What the statute did originally provide, before it was amended to provide for Commission action in connection with it, was that the owner of "any well producing natural gas, in order to prevent the said gas from wasting by escape" (italics mine) shall within ten days after encountering such gas confine it in the well until such gas shall be utilized for light and fuel. Rev. St. Tex. 1925, art. 6008. As amended by the 42d Legislature at its First Called Session in 1931 (chapter 26, § 2), this article provided, that the Commission, the statutory conservation agent, could permit the use of gas for repressuring and for any other purposes which it might find, after hearing, practical and conducive to the public welfare. This statute, in some form or other, has been on the books since 1899 (Acts 1899, c. 49), but so far as I am aware, it has not been contended, until in this case, that it had any other legislative purpose than that defined in so many of the statutes against waste, to prevent the escape of gas into the air. The ideas plaintiffs now advance that it had the purpose or effect of limiting the gas to particular economic uses, and particularly that it operates to confer upon landowners the right to regulate the economic uses to which their neighbors in a gas field could put their gas, is not borne out or sustained, in my opinion, by either the statute itself, the practice under it, or the construction of it. In the Henderson Case this very point was carefully considered, and the whole statute was sustained, against the attack that it delegated legislative power to the Commission, on the ground that the statute did not limit to particular uses, but merely limited against waste, and that having in other sections defined what "waste" is, the Legislature committed to the Commission the matter of determining, in each particular instance of use, whether this was or was not, within statutory definition, wasteful.[2] Its third erroneous assumption is that the statutes contain now, as they did when the Henderson Case was decided, a section equivalent to subdivision (j), art. 6014, as amended by Laws 1931 (1st Called Sess.) c. 26, § 1, on which that case turned. "(j) The escape into the open air of natural gas, except as may be necessary in the drilling or operation of a well." The 42d Legislature, at its Fourth Called Session (chapter 2, § 1 [Vernon's Ann. Civ. St. Tex. art. 6014]), amended this subdivision out of the law, as indeed was necessary in accordance with the changed policy of the state in regard to permitting the use of gas for stripping. As the Conservation Statutes now stand, nothing in them declares wasteful the practice plaintiffs seek to enjoin. Nothing in them arbitrarily confines gas to the well until it can be used for light or fuel. Nothing in them gives the owner a right to restrain another owner's beneficial use of his gas. On the contrary, they specifically authorize the use defendants are making.
But these are not all of plaintiffs' erroneous assumptions. A basic error in their attack upon the provisos is the assumption that they were enacted as mere provisos to an existing statute in such manner that the proviso, if invalid, would fall without taking the statute with it. The legislative history of these enactments does not bear out this view.
As it stood when the Henderson Case was decided, it had already been, by an *791 amendment of the whole section, made to carry the Commission's permit proviso which was construed in that suit. After that case had decided that article 6008 as it stood (as amended by Laws 1931, 1st Called Sess., c. 26, § 2), construed in connection with subdivision (j) of article 6014, prevented the use of gas for stripping, the 43d Legislature, at its Regular Session (chapter 100, § 1), Senate Bill 92, amended article 6008 as amended by the 42d Legislature, 1st Called Sess., c. 26, § 2, to read as originally enacted with the permit proviso left off, and the 300,000-acre proviso added. As appears from the subsequent act of the same Legislature, this permit proviso was left off by mistake. Section 2 of this act provides that if any section, subdivision, paragraph, clause, or word of the article be held invalid, the remaining portions shall be valid, and (section 3) all laws inconsistent with or in conflict with this law shall be repealed. At the First Called Session of the 43d Legislature (chapter 88), House Bill 199 was enacted under the emergency clause. This bill recited that the failure to include the permit proviso in the earlier enactment was by mistake, and it re-enacted article 6008 so as to read as it now stands (Vernon's Ann. Civ. St. Tex. art. 6008), with the two provisos in it. This act contained no separability provision. Its structure and the circumstances of its enactment make it clear, I think, that it was intended to stand or fall, it does stand or fall, as a whole. If the provisos are not valid, the whole act is invalid, for they so condition and make up the legislative policy of gas conservation, as that it cannot be said that any part of it is separable from the other. If then the provisos, or either of them, are invalid, the statute is. Thus, plaintiffs' suits based on the statute inevitably fail, for if the provisos are valid, defendants are protected by them. If they are invalid, the whole statute falls.
I am already committed by the Henderson Case, to the proposition that the permit proviso is valid. I agree with the District Judge that the other proviso is too. I think, however, that over and above all of these, there are larger reasons for denying the injunctions prayed.
Plaintiffs' argument is directed, as the argument was in the case of Canadian River Gas Co. v. Terrell (D. C.) 4 F. Supp. 222, in regard to the statute under examination there, to maintaining that the Legislature has undertaken, by the statute in question, to change the rule of property heretofore existing in Texas so as to take from the landowner the absolute right to his gas in place and give him, in lieu thereof, a qualified title, subject to his adjoiners' approval of the use he intends to make of his gas. We did not then think it likely that the Legislature had intended, by a public conservation statute, to put such new rules in force as between private owners. I think the argument no more valid here. I think it clear that unless its provisions clearly show that this is intended a statute ought not to be construed as an attempt to change the rule that an owner may take his oil, and gas, though in doing so he may appropriate oil or gas underlying his neighbor's holdings, or may make a beneficial use of his oil or gas which does not coincide with his neighbor's economic views. When, as here, the statutes in question expressly authorize the use plaintiffs seek to have enjoined, it is quite clear to me that federal equity jurisdiction ought not to be exerted to establish a new rule of property, by declaring state statutes evidencing state policy to be invalid without a most clear showing of the existence of an undoubted right and a really threatened and irreparable injury which the injunction of the court may prevent. Pape v. St. Lucie Inlet Dist. & Port Authority Drainage Dist. (C. C. A.) 75 F.(2d) 865, and cases cited.
But there is still more against the exertion of federal equity jurisdiction in this case. Even in a direct attack upon a state statute on the ground that it violates a state Constitution, a federal court will not, in advance of a state court decision on the point, grant an injunction against it, unless its unconstitutionality is perfectly plain. Pullman Co. v. Knott, 235 U.S. 23, 35 S. Ct. 2, 59 L. Ed. 105; Kentucky-Tennessee Light & Power Co. v. City of Paris (C. C. A.) 48 F.(2d) 795; Doscher v. Query (D. C.) 21 F.(2d) 521; Utah Power & Light Co. v. Pfost, 286 U.S. 165, 185, 52 S. Ct. 548, 76 L. Ed. 1038. By much the more will it not, in a controversy of this kind, where in a great gas field like this, one owner seeks to enjoin another owner from using his gas for the purpose the Legislature has declared he may use it for, and for which purpose others are using theirs, restrain that use in a collateral attack upon statutes and permits granted by the Commission under the authority of the statutes, on the ground that the statutes and permits authorizing the use *792 are invalid. Especially will it not do this where to restrain the defendants from using their land under authority of the Commission and under direct statutory warrant, will result, according to plaintiffs' own allegations, in grievously and injuriously depriving defendants, as well as plaintiffs, of gas which, still according to plaintiffs, is being wasted and dissipated through the wells of others, taken under statutory authority, from the same pool.
I think the bills are plainly without equity. I respectfully dissent from the reversal.
NOTES
[1] A description of this Panhandle field, particularly as concerns the oil bearing portion, and something of the history of the public litigation over the conservation of oil and gas it has given rise to may be found in Note to Danciger Oil & Ref. Co. v. Smith (D. C.) 4 F. Supp. 236, and in Canadian River Gas Co. v. Terrell (D. C.) 4 F. Supp. 222.
[1] It is said of an objection to the want of parties
"This objection does not affect the jurisdiction, but addresses itself to the policy of the court. Courts of equity require, that all the parties concerned in interest shall be brought before them, that the matter in controversy may be finally settled. This equitable rule, however, is framed by the court itself, and is subject to its discretion. It is not * * * an inflexible rule, a failure to observe which turns the party out of court, because it has no jurisdiction over his cause; but being introduced by the court itself, for the purposes of justice, is susceptible of modification, for the promotion of those purposes." Elmendorf v. Taylor, 10 Wheat. 152, 166, 6 L. Ed. 289.
[2] In that case it is said: "We find in the enactment of article 6008, requiring persons discovering gas in order to prevent its waste by escape, to confine it, and providing for inquiry by the commission into the propriety of an authorization, if found, of other uses, neither unreasonable exertion or prohibited delegation of legislative power. This article, a part of an entire program, is of a piece with the balance of the applicable law. It is designed to and its very terms prevent, either the arbitrary shutting down of gas wells, or the wasteful escape of gas into the air. The statute carefully avoids an express requirement that the gas shall at all events be confined. It orders it confined in order to, and only in order to, prevent its escape by waste. It provides for an orderly and careful inquiry into and determination of the question of fact whether there are other uses than those of light and fuel, to which the gas may be put without permitting waste by escape. It delegates to the body charged with the duty, and informed by experience in its discharge, of conserving the oil and gas resources of the state, the fact determination necessary to release a well. Such delegation to an administrative fact finding body like the Railroad Commission is universally recognized as reasonable, valid and appropriate. Armstrong v. Whitten (D.C.) 41 F.(2d) 241; United States v. Grimaud, 220 U.S. 506, 31 S. Ct. 480, 55 L. Ed. 563; Brazeale v. Strength (Tex. Civ. App.) 196 S.W. 247; Trimmier v. Carlton, 116 Tex. 572, 296 S.W. 1070; City of Denison v. Municipal Gas Co., 117 Tex. 291, 3 S.W.(2d) 794." Henderson, Inc., v. R. R. Comm. (D. C.) 56 F.(2d) 218, 221. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/1564508/ | 76 F.2d 918 (1935)
CLARKE et al.
v.
HOT SPRINGS ELECTRIC LIGHT & POWER CO. et al.
CUFF
v.
SAME.
CLARKE et al.
v.
WRIGHT et al.
Nos. 1140-1142.
Circuit Court of Appeals, Tenth Circuit.
April 1, 1935.
*919 M. A. Kline, of Cheyenne, Wyo., for appellants.
Hagens & Wehrli and E. E. Enterline, all of Casper, Wyo., and Wilfred O'Leary, of Cheyenne, Wyo., for appellees R. J. Ireland and Thermopolis Northwest Electric Co.
C. J. Heermance, of New York City, for appellee Herman Rehrer.
Fred R. Wright, Gail L. Ireland, Clarence L. Ireland, and Dudley W. Strickland, all of Denver, Colo., and Charles Caldwell, of New York City, pro se.
Before PHILLIPS, McDERMOTT, and BRATTON, Circuit Judges.
McDERMOTT, Circuit Judge.
These appeals grow out of litigation which was before this court in Clarke v. Hot Springs Electric Light & Power Company, 55 F.(2d) 612. At that time this court affirmed, save in a minor particular, a decree of the district court of Wyoming entered on July 16, 1930. Since the present appeals are, in part, from orders of the trial court refusing to tamper with that decree after its affirmance, its pertinent provisions may be noticed.
That decree was entered in a suit to foreclose a mortgage on the property of the Hot Springs Electric Light & Power Company. There being insuperable objections to foreclosing the specific lien of the mortgage, the decree directed that the defendants pay into court the sum of $72,000, found to be the value of the mortgaged properties at the time they were converted by defendants, with 7 per cent. interest for four years, or a total sum of $92,160; a lien was fastened on the properties of the corporate defendant to secure the payment of said sum; upon the payment of that sum to the clerk of the court, the liens of the decree and the mortgage to be discharged. In paragraph 10, it was decreed that "the attorneys for the said plaintiffs be allowed and paid the sum of $10,000 out of the amount hereinabove decreed to be paid * * * together with their expenses necessarily incurred in the prosecution of this case, which the court finds to be $673.80." The decree provided that the balance of the fund should be distributed to the bondholders.
From this decree the plaintiffs appealed, contending that the court erred in its finding as to the value of the mortgaged properties at the time of their conversion by defendants. No assignment of error was directed to the point that the decree did not provide for interest from the date of the decree until payment, nor was error assigned as to the allowance of attorneys' fees from the fund. Error was assigned because the decree did not provide for reimbursement to plaintiffs for certain expenses incurred in preparing the case for trial.
This court directed the trial court to make allowance, out of the fund, to plaintiffs for reasonable and necessary expenses incurred in the preparation of the case for trial, and "In all other respects," the opinion and mandate recite, "the decree is affirmed."
Still dissatisfied, plaintiffs petitioned for certiorari, which was denied. 287 U. S. 619, 53 S. Ct. 19, 77 L. Ed. 537. In the petition for the writ, the attorneys to whom *920 allowance had been made for fees were made respondents, and that allowance was for the first time challenged. Upon the denial of this petition, the mandate was filed in the trial court on March 21, 1932.
On July 20, 1932, a hearing was had as to the amount of expenses which plaintiffs had incurred in preparing for trial. Evidence was taken and the matter submitted on briefs. John T. Clarke, a bondholder not a named party, claimed to have expended several thousand dollars on this case and allied matters, and also claimed $4,400 for 110 days' time he testified he had devoted to the case.
On November 4, 1932, the trial court filed an opinion setting forth its views, and on December 12, 1932, entered findings of fact, conclusions of law, and a "Final Decree" allowing $1,293.98 for expenses incurred by plaintiffs and John T. Clarke, and disallowing the other amounts claimed.
This order of December 12, 1932, was final as to all matters which were remanded to the trial court for determination. No appeal was taken within the statutory period. Five months after the final order, but within the term, an elaborate petition for rehearing was filed, seeking a review of all of the court's findings of December 12, and bringing onto the record, for the first time, an entirely new question, to wit, that the decree of July 16, 1930, should be amended to require the defendants to pay interest on the amount decreed to be owing by them, for the time elapsing pending plaintiffs' unsuccessful efforts to increase the award. On May 8, 1933, this phase of the petition was denied, and the petition continued as to other matters. On that day, the defendants paid into court the sum decreed to be due from them.
On August 5, 1933, an appeal was taken by plaintiffs below from the order of May 8, 1933 (No. 1140) "and particularly" from that part of the order denying interest pending the appeal. The only other part of the order of May 8 was to continue the hearing on the balance of the petition to a future date, which is not an appealable order. On the same date another appeal (No. 1141) was taken from the same order by the trustee for the depositing bondholders. On August 8, 1933, amended petitions for appeal were filed which were not allowed, and which differed from the petitions of August 5 only in phraseology.
On April 4, 1934, the trial court entered an "Order Overruling Petition for Rehearing and Making Allowance to John T. Clarke for Services." The order allowed John T. Clarke $1,250 for his services, but made no other change in the order of December 12, 1932.
On July 2, 1934, an appeal was taken from the order of December 12, 1932, "as modified by the order of April 4, 1934." This appeal is likewise docketed as No. 1140.
On May 8, 1933, the date on which defendants paid the $92,160 into court, the trial court ordered the clerk to pay Wright and Ireland the $10,673.80, allowed them by the decree of July 16, 1930, for services and expenses as counsel for plaintiffs. This was done. On July 26, 1933, plaintiffs filed a motion to require Wright and Ireland to repay the money into court, claiming that the money belonged to plaintiffs and not their counsel. To which Wright and Ireland filed an answer, offering to pay any other attorneys participating in the litigation such sums as the court decreed, and to account to John T. Clarke for the sums advanced by him for services in this case. Many other counsel filed claims against the fund. Extensive hearings were held, and on April 5, 1934, the trial court entered findings and a decree; allowances were made to all other counsel and the right of John T. Clarke to reimbursement for sums advanced by him was recognized; Wright and Ireland were required to account for the balance shown on a striking of accounts between them and Mr. Clarke. On July 2, 1934, an appeal was taken by plaintiffs and John T. Clarke only, from that order (No. 1142).
It is extremely doubtful whether there is anything before us except the amount of the allowance to John T. Clarke for his services. The decree of July 16, 1930, was affirmed by this court except as to the one item of expenses of plaintiffs in preparing for trial. The trial court had no authority to alter or revise the decree in any other particular. Gaines v. Rugg, 148 U. S. 228, 13 S. Ct. 611, 37 L. Ed. 432. The trial court was without authority to modify the decree, after affirmance, by adding to it a provision as to interest or by changing the allowance of counsel fees from "the attorneys for the said plaintiffs" to "the plaintiffs." If the decree of July 16, 1930, was in error in such respects, the points should have been raised on the first appeal. Errors in a decree rendered July 16, 1930, cannot be corrected by appeals *921 taken in August, 1933. Certainly a trial court should not be reversed for declining to amend a decree which this court has affirmed.
The only power which the trial court had after affirmance was to enforce the decree as affirmed, and to make an allowance for expenses. After a full hearing, it made such allowances on December 12, 1932. That order was appealable, but no appeal was taken within the statutory period. A petition for rehearing seasonably filed within the time for appeal will toll the time for appeal. But the petition was not filed within the time for appeal. A petition for rehearing cannot resurrect a right of appeal which has expired. If filed within the term, even after the time for appeal has expired, the trial court may grant it, thus vacate the decree, and start again. But if the rehearing is denied, the original decree stands, and the right of appeal is not revived. All this has been carefully spelled out by the courts. Larkin Packer Co. v. Hinderliter Tool Co. (C. C. A. 10) 60 F.(2d) 491; Northwestern Public Service Co. v. Pfeifer (C. C. A. 8) 36 F.(2d) 5; Chicago, M. & St. P. Ry. Co. v. Leverentz (C. C. A. 8) 19 F.(2d) 915; Conboy v. First Nat. Bank of Jersey City, 203 U. S. 141, 27 S. Ct. 50, 51 L. Ed. 128. The trial court denied the rehearing as to the expenses, and allowed it only as to the allowance to Mr. Clarke for his services. The only avenue of escape from these settled principles is to treat the allowance made to Mr. Clarke in 1934 as a rehearing on the whole matter of expenses.
No motions to dismiss the appeals have been interposed; the questions have not been briefed; and while we entertain grave doubts about the pendency of the appeals except as to the amount allowed John T. Clarke for his services, we turn briefly to the merits.
Expenses Allowed to Plaintiffs.
John T. Clarke, a business man, assisted in preparing the case for trial. He testified he spent 110 days in that work; he appraised the value of his services at $40 a day, and testified that his services "were much more expert than many lawyers could have given in this kind of work." The trial court has had extensive opportunity to judge of the character and value of the services Mr. Clarke renders in litigation. It is claimed the trial court is bound by Mr. Clarke's appraisal of his own services. If so, it is fortunate he did not appraise them at $400 a day. But it is well settled that a trial court is not bound to allow fees his own knowledge and experience tell him are exorbitant because an array of friendly experts testify to their reasonableness. Blackhurst v. Johnson (C. C. A. 8) 72 F.(2d) 644; Federal Oil Marketing Corp. v. Cravens (C. C. A. 8) 46 F.(2d) 938; Tracy v. Spitzer-Rorick Trust & Savings Bank (C. C. A. 8) 12 F.(2d) 755; McDougal v. Black Panther Oil & Gas Co. (C. C. A. 8) 277 F. 701. Neither plaintiffs nor Mr. Clarke has any reason to complain of an allowance of $1,250 for the services rendered in connection with the trial of this case; and the bondholders other than plaintiffs and Mr. Clarke have not appealed.
We likewise are of opinion that the trial court was fair, if not generous, in the allowance of other expenses. Patiently he heard the evidence, examined the briefs, prepared findings of fact and conclusions of law. There is no reason to examine the lengthy items claimed, one by one. Before this suit was brought, plaintiffs brought another, but were so neglectful of it that the court dismissed it for want of prosecution. The court properly declined to load this case with the expenses of that one. Part of the items claimed were taxed as costs to the defendants. A claim for estimated stenographic expense was properly disallowed as too uncertain. The trial court noted that during the period in which the time and expenses of many trips to Wyoming were claimed against this fund, Mr. Clarke had much other litigation in Wyoming, and did not satisfactorily segregate the time and expenses properly chargeable to this fund.
There is no suggestion in the record or many briefs filed of any reason why this court should interfere with the facts as found by the chancellor. Time and again, this court has stated the general rule that findings of fact of a chancellor will not be disturbed on appeal unless it appears that a serious mistake has been made. Standard Oil Co. of Colorado v. Standard Oil Co. (C. C. A. 10) 72 F.(2d) 524.
Interest on the Award.
The decree of July 16, 1930, allowed interest in the amount of $20,160. The plaintiffs appealed, but assigned no error as to the amount of interest allowed. The decree was affirmed. A year and two *922 months after the mandate went down, plaintiffs asked the trial court to amend the decree by adding interest from July 16, 1930, to the date of payment. The trial court declined to modify or amend the decree except in the one particular directed by this court.
The trial court was right. There is a time for all things, and the time to object to the omission of interest from the decree of July 16, 1930, was on the appeal therefrom; the time to object to any oversight in an order of affirmance is by petition for rehearing or other appropriate proceedings in the appellate court. There must be an end to litigation sometime, and there would be no end if trial courts could modify or amend their decrees after affirmance. Of the multitude of cases on the point, it is only necessary to cite those where the trial court undertook to add interest to a judgment or decree after affirmance, for the time elapsed pending the appeal.
In Boyce v. Grundy, 9 Pet. 275, 289, 290, 9 L. Ed. 127, a decree in equity requiring the payment of money was affirmed. Nothing was said in the decree or order of affirmance concerning interest. Upon the mandate coming down, the trial court added interest pending the appeal. Upon the second appeal, the interest was eliminated. Mr. Justice Story, referring to the Supreme Court rule on interest, held: "It is, therefore, solely for the decision of the supreme court, whether any damages or interest (as a part thereof) are to be allowed, or not, in cases of affirmance. If, upon the affirmance, no allowance of interest or damages is made, it is equivalent to a denial of any interest or damages; and the circuit court, in carrying into effect the decree of affirmance, cannot enlarge the amount thereby decreed; but is limited to the mere execution of the decree, in the terms in which it is expressed. A decree of the circuit court, allowing interest in such a case, is, to all intents and purposes, quoad hoc, a new decree, extending the former decree."
In re Washington & Georgetown R. Co., 140 U. S. 91, 94, 96, 11 S. Ct. 673, 35 L. Ed. 339, was a proceeding in mandamus against a trial judge who added interest to a judgment which did not provide for interest and which had been affirmed without any order as to interest. The writ was issued, the court saying: "The fact that the judgment of this court merely affirmed the judgment of the general term with costs, and said nothing about interest, is to be taken as a declaration of this court that, upon the record as presented to it, no interest was to be allowed. It was thereupon the duty of the general term to enter a judgment strictly in accordance with the judgment of this court, and not to add to it the allowance of interest. * * * Under these circumstances, the general term had no authority to make its order of June 9, 1890, in regard to interest on the judgment. * * * The principle has been well established, in numerous cases, that, on a mandate from this court, containing a specific direction to the inferior court to enter a specific judgment, the latter court has no authority to do anything but to execute the mandate."
The statute relied upon, 28 USCA § 811, was originally enacted in 1842. Rule 26 of our court, and Rule 30 of the Supreme Court, here relied upon (28 USCA following section 354), are the same as Rule 62, adopted in December, 1852, save that the present Rule 30 is qualified by the expression "and interest is properly allowable." These cases are therefore binding authorities. They have been uniformly followed by the lower courts. In United States v. United States Dist. Court (C. C. A. 9) 272 F. 611, the rule was followed in a case where, after affirmance, interest was awarded bondholders in an equitable decree. See, also, Hagerman v. Moran (C. C. A. 9) 75 F. 97; Green v. Chicago, S. & C. R. Co. (C. C. A. 6) 49 F. 907.[1]
The trial court being without power in the premises, there is no need to inquire whether this court should have modified the decree, on the first appeal, by including interest on the award pending the appeal. It may be said, however, that the delay in payment was caused by plaintiffs and not defendants; the defendants did not appeal from the award, but paid the money into court the day the trial court denied the claim as to interest. The decree provided *923 that upon the payment of $92,160 the lien on the properties of defendants should be discharged. As long as plaintiffs kept the case in the courts, defendants could not clear their properties of the lien; and until such clearance could be had, they were not bound to pay. No equitable reason is suggested why defendants, ready, able, and willing to comply with the decree, should be required to pay interest to plaintiffs for the period of a delay brought about by plaintiffs' unsuccessful effort to increase the award. The Scotland, 118 U. S. 507, 6 S. Ct. 1174, 30 L. Ed. 153; Bates v. Dresser, 251 U. S. 524, 40 S. Ct. 247, 64 L. Ed. 388; Zurich General Accident & Liability Co. v. Mid-Continent Petroleum Corp. (C. C. A. 10) 43 F.(2d) 355, 358.
The decrees appealed from in Nos. 1140 and 1141 are affirmed.
The Attorneys' Fees (No. 1142).
In the decree of July 16, 1930, the court made the following order: "That the attorneys for the said plaintiffs be allowed and paid the sum of ten thousand dollars ($10,000.00) out of the amount hereinabove decreed to be paid by the said defendants, R. J. Ireland and the Thermopolis Northwest Electric Company, to the clerk of this court, together with their expenses necessarily incurred in the prosecution of this case, which the court finds to be six hundred seventy-three and 80/100ths Dollars ($673.80)."
Upon appeal from that decree, no error was assigned to this allowance. The decree in this respect was affirmed by this court and certiorari denied. When appellees paid the award into court on May 8, 1933, the court directed the clerk to pay this allowance to Wright and Ireland, the only attorneys of record for the appellants. This was done. Appellants then petitioned the court to require the attorneys to repay the money to the clerk. Wright and Ireland, in their answer, offered to pay any amounts fixed by the court for services of other attorneys who assisted in the litigation. The trial court fixed such sums, and no one objects thereto. Wright and Ireland, in their answer, stated that "it is the sole purpose and wish of these respondents to dispose of said allowance in conformity with the intent of this court and such directions as this court may give." They set up a statutory lien for other services performed and asked that it be satisfied out of any part of such allowance found to be due appellants. The trial court, after a trial, found that John T. Clarke was entitled to $6,436.90 on account of advancements to Wright and Ireland and other counsel for their services and expenses; but that the said attorneys had a lien thereon for $6,596.91, which was established and foreclosed; that because of this offset, appellants were entitled only to a credit against their indebtedness to Wright and Ireland; their petition to require it to be repaid to the clerk was therefore denied.
If we understand the attack made on the trial court's order in this regard, it is twofold: (1) That the allowance should have been made to appellants or to John T. Clarke, and not to their attorneys; (2) that Wright and Ireland should repay appellants the moneys advanced by them while they are indebted to Wright and Ireland on other accounts for more than the advancements; that is, that Wright and Ireland should be denied the ordinary right of setoff.
1. The contention that the allowance in the original decree was not intended to be made to Wright and Ireland cannot be sustained. Judge Kennedy has twice held that the allowance was made to Wright and Ireland, although their names did not appear in the order; once when he ordered the clerk to pay the sum "to Wright and Ireland," and again in his present findings. And, as was tersely said by the late and revered Mr. Justice Holmes in construing an order made by Judge Pollock, "The Judge knows at least what he intended and supposed himself to do." There is internal proof of the correctness of this interpretation: Wright and Ireland were the only attorneys of record for appellants; the allowance for expenses is specific to a penny, and such expense allowance tallies exactly with the expenses of Wright and Ireland and of no one else.
There being no reasonable doubt as to the construction of the decree, the relief now sought can only be had by altering the decree so as to make the allowance to appellants instead of Wright and Ireland. The authorities heretofore cited in connection with amending the decree after affirmance to include interest is a complete bar to altering the decree now with reference to counsel fees. We do not intimate that, under any circumstances, either Judge Kennedy or this court would countenance an arrangement by which an attorney, to whom an allowance has been *924 made for legal services, should divide that fee in direct defiance of the established canons of professional ethics, nor skirt so close to champerty and maintenance as to allow an attorney's fee to those who are not officers of the court. Such a course would permit speculators, not subject to the discipline of the court, to stir up litigation. The claim that this attorney's fee should be paid to appellants directly, and let them retain whatever sum they can after negotiations with counsel, cannot be sustained.
2. Where there was conflict in the testimony at the trial, the court below and this court find that Mr. Wright's testimony is correct. From that testimony it appears that John T. Clarke, for himself and his brothers, employed Wright and Ireland to represent them in the foreclosure suit for a fee which was not contingent and which was based upon the amount of work done. Charges for services and expenses were to be paid monthly, an agreement not kept by the clients. Nothing was then said as to allowance for services which might be made in the decree, or charges against the fund recovered for other bondholders, if the case was won. Months later John T. Clarke intimated that the fees "will be paid out of the decree," to which Wright and Ireland replied that if that were to be done, a settlement for fees must be made "on an entirely different basis." The matter dropped there. Wright and Ireland were paid $5,196.41 under this agreement; Clarke paid other counsel $1,240.49, making a total paid by Clarke to all attorneys of $6,436.90.[2]
The services rendered by Wright and Ireland resulted in a substantial recovery for bondholders other than appellants. Such bondholders so benefited should pay for the services. It would be inequitable to permit them to share in the proceeds without contributing to the expense. Trustees v. Greenough, 105 U. S. 527, 26 L. Ed. 1157; Central Railroad v. Pettus, 113 U. S. 116, 5 S. Ct. 387, 28 L. Ed. 915; Colley v. Wolcott (C. C. A. 8) 187 F. 595; Nolte v. Hudson Nav. Co. (C. C. A. 2) 47 F.(2d) 166; Clarke v. Hot Springs Electric Light & Power Co. (C. C. A. 10) 55 F.(2d) 612. The allowance of the $10,000 fee to Wright and Ireland compensated them to the extent of approximately $5,000 for services rendered to bondholders other than appellants; and their holdings were such that they paid on about the same basis as provided by the contract between Wright and Ireland and appellants. No complaint is made that the allowance is excessive, and very apparently it is not. The allowance was properly made to the attorneys. Central Railroad v. Pettus, supra; Colley v. Wolcott, supra; Nolte v. Hudson Nav. Co., supra. The bondholders have recovered $92,160 through a long and complicated litigation, for a total charge of approximately eleven per cent. of the recovery. Appellants have been reimbursed for all sums advanced by them; all bills have been paid; the disposition of the case, on the face of the record, seems to be entirely just and fair to all concerned. No complaint was made below or here because appellants' share of the $10,000 allowance exceeds the contract rate for the services; and, as we understand the bond holdings, there could be no complaint on that score.
What is the objection? It comes down to this: Wright and Ireland owe appellants $6,436.90 on account of their advancements. Appellants owe Wright and Ireland $6,596.91 on other accounts. Appellants asked Judge Kennedy, and now ask this court, to require Wright and Ireland to pay one side of the account while the other side remains unsatisfied.
We cannot accede to any such request. Independent of the right of set-off provided by statute, courts of equity have long recognized the right to set off mutual liquidated accounts. Mr. Justice McKenna years ago defined set-off as "the discharge or reduction of one demand by an opposite one." Auten v. United States National Bank, 174 U. S. 125, 19 S. Ct. 628, 637, 43 L. Ed. 920.
"Cross demands and counterclaims, whether arising out of the same or wholly disconnected transactions, and whether liquidated or unliquidated, may be enforced, by way of set-off, whenever the circumstances are such as to warrant the interference of equity to prevent wrong and injustice. * * * The adjustment of demands by counterclaim or set-off, rather than by independent suit, is favored and encouraged by the law, to avoid circuity of action and injustice." North Chicago *925 Rolling-Mill Co. v. Ore & Steel Co., 152 U. S. 596, 615, 14 S. Ct. 710, 715, 38 L. Ed. 565.
"But, broadly speaking, it represents the right which one party has against another to use his claim in full or partial satisfaction of what he owes to the other. That right is constantly exercised by business men in making book entries whereby one mutual debt is applied against another. If the parties have not voluntarily made the entries, and suit is brought by one against the other, the defendant, to avoid a circuity of action, may interpose his mutual claim by way of defense, and if it exceeds that of the plaintiff, may recover for the difference." Studley v. Boylston Bank, 229 U. S. 523, 528, 33 S. Ct. 806, 808, 57 L. Ed. 1313.
Mr. Justice Butler, speaking for a unanimous court, recently said: "The adjustment of defendant's demand by counterclaim in plaintiff's action rather than by independent suit is favored and encouraged by the law. That practice serves to avoid circuity of action, inconvenience, expense, consumption of the courts' time, and injustice. Rolling Mill Co. v. Ore & Steel Co., 152 U. S. 596, 615, 616, 14 S. Ct. 710, 38 L. Ed. 565; Railroad Company v. Smith, 21 Wall. 255, 261, 22 L. Ed. 513; Partridge v. Insurance Company, 15 Wall. 573, 579, 21 L. Ed. 229. In the case last mentioned the court, speaking through Mr. Justice Miller, said (page 580 of 15 Wall., 21 L. Ed. 229): `It would be a most pernicious doctrine to allow a citizen of a distant State to institute in these courts a suit against a citizen of the State where the court is held and escape the liability which the laws of the State have attached to all plaintiffs of allowing just and legal set-offs and counterclaims to be interposed and tried in the same suit and in the same form.'" Chicago & N. W. Ry. v. Lindell, 281 U. S. 14, 17, 50 S. Ct. 200, 201, 74 L. Ed. 670.
Our own court, speaking through Judge BRATTON, has said that "the doctrine of set-off or counterclaim usually implies and rests upon the existence of reciprocal demands, mutual and subsisting between the same parties." Minneapolis Nat. Bank v. Liberty Nat. Bank (C. C. A. 10) 72 F.(2d) 434, 436. We have also held that "the doctrine of set-off is more flexible in equity than in law," and quoted with approval from Blount v. Windley, 95 U. S. 173, 177, 24 L. Ed. 424, the following excerpt: "This remedy [of set-off] has been very much extended in equity where the insolvency of the judgment plaintiff, his non-residence within the jurisdiction of the court, the fact that the mutual obligations have grown out of the same transaction, and many other purely equitable considerations, have been held to authorize the setting off of many classes of obligations held by the defendant, against a judgment duly recovered against him in a court of law." Bromfield v. Trinidad Nat. Inv. Co. (C. C. A. 10) 36 F.(2d) 646, 649, 71 A. L. R. 542.
See, also, discussion of the subject by Judge Woolley, in Gray v. School Dist. of Brownsville (C. C. A. 3) 67 F.(2d) 141, certiorari denied, Hustead v. School Dist., 291 U. S. 660, 54 S. Ct. 377, 78 L. Ed. 1052.
Distinct equitable grounds as a condition to the right of set-off have been relaxed during the years, until it may be doubted whether any equitable ground is necessary other than the familiar one of avoidance of a multiplicity of suits and circuity of action. The point need not be ruled, for the nonresidence of appellants affords a recognized equitable basis for the right to set off these mutual accounts. North Chicago Rolling-Mill Co. v. Ore & Steel Co., 152 U. S. 596, 615, 617, 14 S. Ct. 710, 38 L. Ed. 565.
To require Wright and Ireland to pay appellants while the matured, liquidated, and mutual offsetting account is unsatisfied, would be grossly inequitable, result in additional litigation, unnecessarily burden other courts, and result in nothing but delay and expense.
The order of the trial court is fortified by the fact that both the Colorado and Wyoming statutes provide for an attorney's lien. The Colorado statute is chapter 71, Laws of 1903; the Wyoming statute is section 66-201, Wyo. Rev. Stat. 1931. Both read: "An attorney has a lien for a general balance of compensation upon any papers of his client which have come into his possession, in the course of his professional employment, upon money in his hands belonging to his client, and upon money due to his client, and in the hands of the adverse party, in an action or proceeding in which the attorney was employed, from the time of giving notice of the lien to that party."
This language is too clear for construction. Even if an attorney may not sell papers of his client to liquidate the lien, the statute would be meaningless if a client *926 could compel the delivery over of papers or money while indebted to the attorney for services rendered. In re Paschal, 10 Wall. 483, 19 L. Ed. 992.
The order of the trial court in No. 1142, being in full accord with equity and good conscience, is affirmed.
NOTES
[1] To the effect that 28 USCA § 811 does not apply to decrees in equity, nor extend to either judgments or decrees of an appellate court, and that rules of appellate courts do not extend the power of the district courts, see, in addition to cases above cited, Perkins v. Fourniquet, 14 How. 313, 328, 331, 14 L.Ed. 441, and The New York, 108 F. 102 (C. C. A. 6), affirmed, 189 U. S. 363, 23 S. Ct. 504, 47 L. Ed. 854.
[2] These disbursements to other counsel were part of the expenses claimed by appellants in the proceedings appealed from in Numbers 1140 and 1141. They were reimbursed therefor by the order appealed from in Number 1142. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/2199340/ | 50 N.J. 87 (1967)
THE STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT,
v.
MICHAEL A. LEMONGELLO, DEFENDANT-PETITIONER.
The Supreme Court of New Jersey.
June 30, 1967.
Mr. Frederick Klaessig for the petitioner.
Mr. Vincent P. Keuper and Mr. Thomas L. Yaccarino for the respondent.
Denied. | 01-03-2023 | 10-30-2013 |
https://www.courtlistener.com/api/rest/v3/opinions/395294/ | 661 F.2d 310
AMEEJEE VALLEEJEE AND SONS, Appellees,v.M/V VICTORIA U., (Ex Pishtaz Iran), her engines, boilers,tackle, furniture, apparel, etc., in rem, Appellant.AMEEJEE VALLEEJEE AND SONS, Appellants,v.M/V VICTORIA U., (Ex Pishtaz Iran), her engines, boilers,tackle, furniture, apparel, etc., in rem, Appellee.
Nos. 81-1014, 81-1015.
United States Court of Appeals,Fourth Circuit.
Argued June 5, 1981.Decided Oct. 9, 1981.
John H. West, III, Baltimore, Md. (M. Hamilton Whitman, Jr., Ober, Grimes & Shriver, Baltimore, Md. on brief), for appellee in 81-1014 and for appellant in 81-1015.
Robert P. O'Brien, Baltimore, Md. (Donald A. Krach, Niles, Barton & Wilmer, Baltimore, Md., on brief), for appellant in 81-1014 and for appellee in 81-1015.
Before WINTER, Chief Judge, WIDENER, Circuit Judge, and BRITT,* District Judge.
WINTER, Chief Judge:
1
These appeals turn upon whether or not Ameejee Valleejee and Sons (Amjee) was the general agent for Iran Express Lines (IEL) with regard to calls of the vessel, formerly known as the M/V PISHTAZ IRAN, at the port of Karachi. The district court ruled that Amjee was IEL's general agent and disallowed Amjee's claim to a maritime lien except with respect to necessary repairs to the PISHTAZ IRAN made after the outbreak of the Iranian Revolution. The district court concluded that then Ameejee relied, not on the credit of IEL, but on the credit of the vessel. It entered judgment for Amjee for $79,935.45, including prejudgment interest at the rate of 6%, but denied the balance of its claim and its claim to prejudgment interest at the rate of 14%. Both parties appeal.
2
The parties dispute neither the facts nor the applicable rules of law. They differ only in the result which follows from the application of those principles to the facts established here. Our view of the application of those legal principles to the facts leads us to conclude that Amjee was never the general agent of the vessel. We therefore vacate the judgment of the district court and remand the case for entry of judgment in the full amount of Amjee's claim. We also require the district court in allowing prejudgment interest to articulate the reason for the rate it concludes to allow.
I.
3
The undisputed facts are set forth in some detail in the opinion of the district court and we need restate only the salient ones: Amjee, a Pakistani partnership, served as agents for IEL for vessels owned and chartered by IEL calling at the Port of Karachi from 1974 until the disintegration of IEL in connection with the Iranian Revolution in 1978-79. Under the agency agreement, Amjee supplied "berth services" to IEL vessels providing stevedoring services and arranging for supplies and provisions, assisting in dealing with local Pakistani officials, making freight collections, booking cargoes outward bound, advancing funds for necessaries, and other miscellaneous services.
4
Amjee did not, on its own authority, arrange or supervise major ship repairs, pay IEL crews, make decisions concerning port calls at Karachi, schedule itineraries prior to or after departure from Karachi, schedule loading of cargo, accept nonroutine cargo, or exercise any control over any IEL vessel outside of the Port of Karachi. These latter duties were performed by Uiterwyk Corporation (Uiterwyk), general agents of IEL in the United States and shipping manager for the line worldwide. Many of Uiterwyk's officers and stockholders were also officers and stockholders of IEL. Amjee did significant business with IEL but was not affiliated with it or Uiterwyk.
5
From 1974 through 1979, twelve IEL ships were serviced by Amjee at Karachi. Only the M/V PISHTAZ IRAN, and one other vessel called at Karachi more than once. Amjee and IEL settled their accounts on a running basis, but Amjee did break out disbursements and receipts on a ship-by-ship basis. For practical purposes, however, Amjee did recurring business only with the PISHTAZ IRAN, which was apparently the only ship actually owned by IEL.
6
In October 1978 IEL informed Amjee that the PISHTAZ IRAN was scheduled to arrive in Karachi from Khorramshahr, Iran, in November for repair and drydocking. The Iranian Revolution, however, idled the ship in Khorramshahr and cut off communication with IEL. When the ship finally managed to sail in March, Amjee performed its ordinary preparatory berth services and also apparently advanced a deposit demanded by the shipyard on some necessary drydock work. The drydocking had been arranged by Uiterwyk, and the ship remained in drydock in April and May. Amjee eventually advanced the balance of the payments due the shipyard with a bank-guaranteed note in addition to the other necessaries it provided. Uiterwyk, however, supervised the overhaul, even sending an engineer to monitor the work. Uiterwyk promised to reimburse Amjee, at least out of future prepaid freights. After the PISHTAZ IRAN sailed from Karachi in May 1979, it never returned to Pakistan. It was subsequently acquired by another owner, many of whose officers and stockholders were also principals of Uiterwyk, and renamed. Neither Uiterwyk nor IEL ever paid Amjee for the monies it disbursed on the vessel's behalf.
II.
7
The parties do not dispute, and we agree, that as a general proposition of law a general agent of a ship, as distinguished from a special agent, is not permitted to assert a maritime lien against the ship except in those rare instances where the general agent by express agreement with the owner is given a lien on the vessel, or there are present such circumstances as to imply such an agreement. The rationale of the rule is that a general agent is so closely related to the owner that he is presumed to have made advances on the credit of the owner rather than that of the ship. Conversely, a special agent, having no close ties or relationship to the owner, is presumed to make advances on the credit of the ship. G. Gilmore and C. Black, The Law of Admiralty, § 9-20, p. 626, n.89 (1975); 2 Benedict on Admiralty, § 33, pp. 3-16 and 3-17 (7th Ed. 1975).
8
The recognized leading case on the difference between a general and a special agent for purposes of recognizing a maritime lien is Todd Shipyards Corp. v. The City of Athens, 83 F.Supp. 67 (D.Md.1949) (Chesnut, J.). As Judge Chesnut pointed out in the beginning of his discussion, "(t)he problem in each case is to determine from the facts the scope of the authority of the agent in the light of the relationship between the principal and agent ..." (emphasis added). Id. at 88. In that case the agent for The City of Athens performed functions at Genoa and Naples very similar to those performed by Amjee for the PISHTAZ IRAN. The ship called at Genoa four times and at Naples twice. The agent had no control over the ship's movements. Judge Chesnut decided that the agent was merely a special agent because of his limited scope of responsibilities and the lack of continuity of service with the owner, evidenced by the segregation of accounts for each voyage. 83 F.Supp. at 88-89. He distinguished The Centaurus, 282 F. 883 (D.Md.1922), aff'd, 291 F. 751 (4 Cir. 1923), because of the longer service and greater responsibility of the agent in that case. He relied on the Restatement of Agency § 3 for the significance of continuity of service in determining whether an agent was special or general. Continuity of service was relied on by the district court in the instant case as an important factor for its holding that Amjee was IEL's general agent and hence not entitled to a maritime lien.
9
While The City of Athens stressed continuity of service as an important factor in rendering an agent a general agent, continuity of service has not been a significant factor in the decisions of other courts. See, e. g., Dampskibsselskabet Dannebrog v. Signal Oil & Gas Co., 310 U.S. 268, 60 S.Ct. 937, 84 L.Ed. 1197 (1940), aff'g International Terminal Operating Co. v. S/S VALMAS, 375 F.2d 586 (4 Cir. 1967), aff'g The Stjerneborg, 106 F.2d 896, 897 (9 Cir. 1939); indeed The City of Athens recognized that "the potency of the 'general agent' rule has been somewhat impaired if not eliminated by the federal lien statute (46 U.S.C. § 971) which in terms gives the lien to 'any person.' " 83 F.Supp. at 89. Some courts have viewed the federal lien statute as establishing a presumption that necessaries are provided on the credit of the ship, so that "a maritime lien arises unless it is affirmatively established that it was done solely on personal credit." Point Landing, Inc. v. Alabama Dry Dock & Shipbuilding Co., 261 F.2d 861, 867 (5 Cir. 1958).
10
Notwithstanding the emphasis on continuity of service contained in The City of Athens, we think that the more important factor in the determination of whether agents are general or special is the degree of authority which the owners have delegated to them. Although continuity of service is a factor to be considered, we think that one may be a general agent for a single transaction involving a ship; and, conversely, one may be a special agent over a period of years involving numerous transactions. To repeat, the more important factor is the scope of the agent's authority. If the delegated authority is substantial, the agents are general agents; but if the authority is limited to getting a vessel in and out of a particular port, the agents are special agents and may assert maritime liens. See 2 Benedict on Admiralty § 33, supra. Two cases in our own circuit are illustrative of the principle, because both deal with circumstances where the agent was vested with a substantial portion of the owner's authority.
11
In Savas v. Maria Trading Corp., 285 F.2d 336 (4 Cir. 1960), a marine engineer was held to be a special agent for services he performed on a ship in Norfolk and in Baltimore but was held a general agent for services performed in Bremen. The distinction was simply that he went to Bremen as the owner's representative to supervise work at a German yard, whereas he performed the work in this country independently. 285 F.2d at 338-39. The circumstances suggested continuity of service but the determinative factor was clearly the scope of the agent's delegated authority, and thus the degree of reliance on the credit of the ship. Similarly, in The Centaurus, supra, where the agent was not permitted to claim a maritime lien, the district court carefully noted that the owner had agreed to purchase all the stock of the agent, exercised voting control of the stock, that the president of the agent became a salaried vice president of the owner, and that the owner paid over a quarter of the amount due for the agent's prior advances without any allocation of the amount to any ship of the fleet managed. Accord, The West Irmo, 1 F.2d 87 (3 Cir. 1924) (same owner and agent, common control emphasized).
12
Here, Amjee clearly dealt with Uiterwyk and IEL at arm's length. Uiterwyk, not Amjee, acted as the general agent proscribed from lien acquisition by the law of admiralty. It directed the ship's movement, managed the subcontractors for services, including Amjee, and at all times maintained an extraordinary interlocking of ownership and control with IEL, the owner of the PISHTAZ IRAN. See The M. Vivian Pierce, 48 F.2d 644 (D.Mass.1931). By contrast, Amjee performed very limited functions and the scope of its authority was quite restricted.
13
We therefore conclude that Amjee was a special agent entitled to assert a maritime lien for its full claim and that the district court incorrectly ruled it a general agent. In view of this holding, we need not consider the correctness of the district court's holding that with respect to part of its claim Amjee fell within the exception to the rule prohibiting a general agent from asserting a maritime lien.
III.
14
In allowing prejudgment interest, the district court fixed the rate at 6%. It articulated no reason why it considered this rate the proper one.
15
The award of prejudgment interest in admiralty cases rests within the sound discretion of the district court. See Gardner v. The Calvert, 253 F.2d 395, 402-03 (3 Cir.), cert. denied, 356 U.S. 960, 78 S.Ct. 997, 2 L.Ed.2d 1067 (1958) (court not bound to charge maximum legal rates of interest). When allowed, prejudgment interest is considered an element of damages in admiralty, part of full and fair compensation to the injured party. See Gulf Oil Corp. v. Panama Canal Co., 481 F.2d 561, 570-71 (5 Cir. 1973) (Brown, C. J.); Norfolk Shipbuilding & Drydock Corp. v. The M/Y La Belle Simone, 537 F.2d 1201, 1204 (4 Cir. 1976). Accordingly, the district courts are not bound by state statutory maximums in setting the rate of prejudgment interest in admiralty cases, and indeed have been urged to follow the interest rate prevailing commercially. United States v. M/V Gopher State, 614 F.2d 1186, 1190 (8 Cir. 1980); Sabine Towing and Transportation Co. v. Zapata Ugland Drilling, Inc., 553 F.2d 489, 491 (5 Cir.), cert. denied, 434 U.S. 855, 98 S.Ct. 175, 54 L.Ed.2d 127 (1977); but cf. United States v. M/V Zoe Colocotroni, 602 F.2d 12, 14 (1 Cir. 1979) (Coffin, C. J.) (failure to award higher commercial rate instead of statutory maximum no abuse of discretion).
16
The record, however, does not show the basis on which the district court exercised its discretion. There is testimony that Amjee borrowed funds to replenish its advances to the PISHTAZ IRAN at a rate of 14%. The statutory maximum interest rate in Maryland is 10%, the rate of postjudgment interest fixed by the district court. Nothing in the present record shows why the district court fixed the prejudgment rate at 6%.
17
We do not indicate to the district court how, on remand, its discretion to allow prejudgment interest should be exercised. But we do require the district court in making an allowance of prejudgment interest to disclose the reasons why it selected the rate that it concludes to fix. Where, as here, there is nondisclosure and the reasons are not otherwise apparent, appellate scrutiny for possible abuse of discretion is impossible; and we would otherwise be required to remand the case for further explication by the district court.
18
VACATED AND REMANDED.
*
Honorable W. Earl Britt, United States District Judge for the Eastern District of North Carolina, sitting by designation | 01-03-2023 | 08-23-2011 |
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